<PAGE>
Registration No. 333-______
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
________________
FORM S-6
FOR REGISTRATION
UNDER
THE SECURITIES ACT OF 1933 OF SECURITIES
OF UNIT INVESTMENT TRUSTS REGISTERED
ON FORM N-8B-2
________________
NORTHWESTERN MUTUAL VARIABLE LIFE ACCOUNT
(EXACT NAME OF TRUST)
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
(NAME OF DEPOSITOR)
720 EAST WISCONSIN AVENUE
MILWAUKEE, WISCONSIN 53202
(COMPLETE ADDRESS OF DEPOSITOR'S PRINCIPAL EXECUTIVE OFFICES)
JOHN M. BREMER, EXECUTIVE VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
720 EAST WISCONSIN AVENUE
MILWAUKEE, WISCONSIN 53202
(NAME AND COMPLETE ADDRESS OF AGENT FOR SERVICE)
___________________
VARIABLE JOINT LIFE INSURANCE POLICIES
(TITLE OF SECURITIES BEING REGISTERED)
APPROXIMATE DATE OF PROPOSED PUBLIC OFFERING: DECEMBER 10, 1998
The registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
<PAGE>
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
NORTHWESTERN MUTUAL VARIABLE LIFE ACCOUNT
VARIABLE JOINT LIFE INSURANCE POLICIES
CROSS-REFERENCE SHEET
Cross reference sheet showing location in Prospectus of information
required by Form N-8B-2.
Item Number Heading in Prospectus
----------- ---------------------
1 ........................ Cover Page
2 ........................ Cover Page; Northwestern Mutual Life
3 ........................ Not Applicable
4 ........................ Distribution of the Policies
5 ........................ The Account
6 ........................ The Account
7 ........................ Not Applicable
8 ........................ Not Applicable
9 ........................ Legal Proceedings
10(a) .................... Other Policy Provisions: OWNER
10(b) .................... Other Policy Provisions: DIVIDENDS
10(c) and (d) ............ Death Benefit, Cash Value, Policy
Loans, Withdrawals of Cash Value, Right
to Return Policy
10(e) .................... Premiums, Termination and
Reinstatement
10(f) .................... Voting Rights
10(g) .................... Voting Rights, Substitution of Fund
Shares and Other Changes
10(h) .................... Voting Rights, Substitution of Fund
Shares and Other Changes
10(i) .................... Premiums, Death Benefit, Cash Value,
Dividends
11 ....................... The Account, The Fund
12 ....................... The Fund
13 ....................... Summary, The Fund, Deductions and
Charges, Distribution of the Policies
14 ....................... Summary: The Policy: Availability
Limitations
15 ....................... Premiums, Allocations to the Account
16 ....................... The Account, The Fund, Allocations
to the Account
17 ....................... Same Captions as Items 10(a), (c),
and (d)
18 ....................... The Account, Detailed Information about
the Policy
19 ....................... Reports
20 ....................... Not Applicable
21 ....................... Policy Loans
22 ....................... Other Policy Provisions:
INCONTESTABILITY and DEFERRAL OF
DETERMINATION AND PAYMENT
23 ....................... Not Applicable
24 ....................... Not Applicable
25 ....................... Northwestern Mutual Life
26 ....................... The Fund, Deductions and Charges
27 ....................... Northwestern Mutual Life
28 ....................... Management
29 ....................... Not Applicable
30 ....................... Not Applicable
31 ....................... Not Applicable
32 ....................... Not Applicable
-ii-
<PAGE>
33 ....................... Not Applicable
34 ....................... Not Applicable
35 ....................... Northwestern Mutual Life
36 ....................... Not Applicable
37 ....................... Not Applicable
38 ....................... Distribution of the Policies
39 ....................... Distribution of the Policies
40 ....................... The Fund
41 ....................... The Fund, Distribution of the Policies
42 ....................... Not Applicable
43 ....................... Not Applicable
44 ....................... The Fund, Premiums, Death Benefit,
Allocations to the Account, Cash Value
45 ....................... Not Applicable
46 ....................... Same Captions as Items 10(c) and (d)
47 ....................... Not Applicable
48 ....................... Not Applicable
49 ....................... Not Applicable
50 ....................... The Account
51 ....................... Numerous Captions
52 ....................... Substitution of Fund Shares and
Other Changes
53 ....................... Not Applicable
54 ....................... Not Applicable
55 ....................... Not Applicable
56 ....................... Not Applicable
57 ....................... Not Applicable
58 ....................... Not Applicable
59 ....................... Financial Statements
-iii-
<PAGE>
PROSPECTUS
December 10, 1998
NORTHWESTERN
MUTUAL LIFE*
The Quiet Company-Registered Trademark-
NORTHWESTERN MUTUAL VARIABLE JOINT LIFE
Flexible Premium Variable Joint Life Insurance Policy
Insurance Payable on Second Death
[PHOTO]
Northwestern Mutual
Series Fund, Inc.
The Northwestern Mutual
Life Insurance Company
720 East Wisconsin Avenue
Milwaukee, Wisconsin 53202
(414) 271-1444
<PAGE>
CONTENTS
PAGE
----
Prospectus . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . 1
Summary. . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . 2
Variable Life Insurance. . . . . . . . . . . . . . . . . . . . . . . . 2
The Account and its Divisions. . . . . . . . . . . . . . . . . . . . . 2
The Policy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Availability Limitations . . . . . . . . . . . . . . . . . . . . . . 2
Premiums . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Death Benefit. . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Cash Value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Deductions and Charges . . . . . . . . . . . . . . . . . . . . . . . 2
From Premiums. . . . . . . . . . . . . . . . . . . . . . . . . . . 2
From Policy Value. . . . . . . . . . . . . . . . . . . . . . . . . 2
From Surrender Proceeds. . . . . . . . . . . . . . . . . . . . . . 3
From the Fund. . . . . . . . . . . . . . . . . . . . . . . . . . . 3
The Northwestern Mutual Life Insurance Company,
Northwestern Mutual Variable Life Account and
Northwestern Mutual Series Fund, Inc . . . . . . . . . . . . . . . 3
Northwestern Mutual Life . . . . . . . . . . . . . . . . . . . . . . . 3
The Account. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
The Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Aggressive Growth Stock Portfolio. . . . . . . . . . . . . . . . . . . 4
International Equity Portfolio . . . . . . . . . . . . . . . . . . . . 4
Growth Stock Portfolio . . . . . . . . . . . . . . . . . . . . . . . . 4
Growth and Income Stock Portfolio. . . . . . . . . . . . . . . . . . . 4
Index 500 Stock Portfolio. . . . . . . . . . . . . . . . . . . . . . . 4
Balanced Portfolio . . . . . . . . . . . . . . . . . . . . . . . . . . 4
High Yield Bond Portfolio. . . . . . . . . . . . . . . . . . . . . . . 4
Select Bond Portfolio. . . . . . . . . . . . . . . . . . . . . . . . . 4
Money Market Portfolio . . . . . . . . . . . . . . . . . . . . . . . . 4
Detailed Information About the Policy . . . . . . . . . . . . . . . . . . 4
Premiums . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Death Benefit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Death Benefit Options. . . . . . . . . . . . . . . . . . . . . . . . 5
Choice of Tests for Tax Purposes . . . . . . . . . . . . . . . . . . 5
Death Benefit Changes. . . . . . . . . . . . . . . . . . . . . . . . 6
Allocations to the Account . . . . . . . . . . . . . . . . . . . . . . 6
Deductions and Charges . . . . . . . . . . . . . . . . . . . . . . . . 6
Deductions from Premiums . . . . . . . . . . . . . . . . . . . . . . 6
Charges Against the Policy Value . . . . . . . . . . . . . . . . . . 6
Surrender Charge . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Expenses of the Fund . . . . . . . . . . . . . . . . . . . . . . . . 7
Cash Value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Policy Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Withdrawals of Cash Value. . . . . . . . . . . . . . . . . . . . . . . 8
Termination and Reinstatement. . . . . . . . . . . . . . . . . . . . . 8
Right to Return Policy . . . . . . . . . . . . . . . . . . . . . . . . 8
Other Policy Provisions. . . . . . . . . . . . . . . . . . . . . . . . 8
Owner. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Beneficiary. . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Incontestability . . . . . . . . . . . . . . . . . . . . . . . . . 8
Suicide. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Misstatement of Age or Sex . . . . . . . . . . . . . . . . . . . . 9
Collateral Assignment. . . . . . . . . . . . . . . . . . . . . . . 9
Deferral of Determination and Payment. . . . . . . . . . . . . . . 9
Dividends. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Voting Rights. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Substitution of Fund Shares
and Other Changes. . . . . . . . . . . . . . . . . . . . . . . . . . 9
Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10
Distribution of the Policies. . . . . . . . . . . . . . . . . . . . . . .10
Tax Considerations. . . . . . . . . . . . . . . . . . . . . . . . . . . .10
General. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10
Life Insurance Qualification . . . . . . . . . . . . . . . . . . . . .10
Tax Treatment of Life Insurance. . . . . . . . . . . . . . . . . . . .10
Modified Endowment Contracts . . . . . . . . . . . . . . . . . . . . .11
Estate and Generation Skipping Taxes . . . . . . . . . . . . . . . . .11
Other Tax Considerations . . . . . . . . . . . . . . . . . . . . . . .12
Other Information . . . . . . . . . . . . . . . . . . . . . . . . . . . .12
Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12
Regulation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14
Legal Proceedings. . . . . . . . . . . . . . . . . . . . . . . . . . .14
Registration Statement . . . . . . . . . . . . . . . . . . . . . . . .14
Experts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15
Financial Statements. . . . . . . . . . . . . . . . . . . . . . . . . . .16
Report of Independent Accountants
(for the two years ended December 31, 1997). . . . . . . . . . . . .16
Financial Statements of the Account
(for the two years ended December 31, 1997). . . . . . . . . . . . .17
Financial Statements of Northwestern Mutual Life
(for the three years ended December 31, 1997). . . . . . . . . . . .23
Report of Independent Accountants
(for the three years ended December 31, 1997). . . . . . . . . . . .36
Appendix A. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .37
Appendix B. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .46
<PAGE>
P R O S P E C T U S
NORTHWESTERN MUTUAL VARIABLE JOINT LIFE
FLEXIBLE PREMIUM VARIABLE JOINT LIFE INSURANCE POLICY
INSURANCE PAYABLE ON SECOND DEATH
This prospectus describes the Variable Joint Life Policy (the "Policy") offered
by The Northwestern Mutual Life Insurance Company. The Policy provides life
insurance coverage on two insureds with a death benefit payable on the second
death while the policy is in force.
The Policy offers flexible premium payments, nine investment funding options and
a choice of three death benefit options.
The investment options correspond to the Portfolios of Northwestern Mutual
Series Fund, Inc. (the "Fund"). The prospectus for the Fund, attached to this
prospectus, describes the investment objectives of the nine portfolios: the
Aggressive Growth Stock Portfolio, the International Equity Portfolio, the
Growth Stock Portfolio, the Growth and Income Stock Portfolio, the Index 500
Stock Portfolio, the Balanced Portfolio, the High Yield Bond Portfolio, the
Select Bond Portfolio and the Money Market Portfolio.
The values provided by the Policy vary daily depending on investment results.
These values are not guaranteed. The Portfolios present varying degrees of
investment risk.
A Policy may be returned for a limited period of time. See "Right to Return
Policy", p. 8.
IT MAY NOT BE ADVANTAGEOUS TO REPLACE EXISTING INSURANCE WITH A VARIABLE LIFE
INSURANCE POLICY. SEE DEDUCTIONS AND CHARGES AND CASH VALUE.
THIS PROSPECTUS IS VALID ONLY WHEN ACCOMPANIED BY THE CURRENT PROSPECTUS FOR
NORTHWESTERN MUTUAL SERIES FUND, INC. WHICH IS ATTACHED HERETO, AND SHOULD BE
RETAINED FOR FUTURE REFERENCE.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING IN ANY JURISDICTION IN WHICH
SUCH OFFERING MAY NOT LAWFULLY BE MADE. NO PERSON IS AUTHORIZED TO MAKE ANY
REPRESENTATIONS IN CONNECTION WITH THIS OFFERING OTHER THAN THOSE CONTAINED IN
THIS PROSPECTUS.
1
<PAGE>
SUMMARY
THE FOLLOWING SUMMARY PROVIDES A BRIEF OVERVIEW OF THE POLICY. IT OMITS DETAILS
WHICH ARE INCLUDED ELSEWHERE IN THIS PROSPECTUS AND THE ATTACHED FUND PROSPECTUS
AND IN THE TERMS OF THE POLICY.
VARIABLE LIFE INSURANCE
Variable life insurance is cash value life insurance and is similar in many ways
to traditional fixed benefit life insurance. Both kinds of life insurance
provide an income tax-free death benefit and a cash value that grows
tax-deferred. Variable life insurance allows the policyowner to direct the
premiums, after certain deductions, among a range of investment options. The
variable life insurance death benefit and cash value vary to reflect the
performance of the selected investments.
THE ACCOUNT AND ITS DIVISIONS
Northwestern Mutual Variable Life Account is the investment vehicle for the
Policies. The Account has nine divisions. The owner of the Policy determines
how net premiums are to be allocated. The assets of each division are invested
in a corresponding Portfolio of Northwestern Mutual Series Fund, Inc. The nine
Portfolios are the Aggressive Growth Stock Portfolio, the International Equity
Portfolio, the Growth Stock Portfolio, the Growth and Income Stock Portfolio,
the Index 500 Stock Portfolio, the Balanced Portfolio, the High Yield Bond
Portfolio, the Select Bond Portfolio and the Money Market Portfolio. The
investment objectives of the Portfolios are briefly described herein. See "The
Fund", p. 3. For additional information see the attached prospectus for the
Fund.
THE POLICY
AVAILABILITY LIMITATIONS The Variable Joint Life Policy is available for two
insureds each between ages 20 and 85. The minimum Specified Amount of insurance
is $1,000,000, or $500,000 if the older insured's issue age is age 50 or older.
PREMIUMS Premiums may be paid at any time and in any amounts, within limits,
but additional premiums will be required to keep the Policy in force if values
become insufficient to pay current charges.
DEATH BENEFIT The Policy offers a choice of three death benefit options:
- - SPECIFIED AMOUNT (OPTION A)
- - SPECIFIED AMOUNT PLUS POLICY VALUE (OPTION B)
- - SPECIFIED AMOUNT PLUS PREMIUMS PAID (OPTION C)
In each case, the death benefit will be at least the amount needed to meet
federal income tax requirements for life insurance. The Specified Amount is
selected by the applicant when the Policy is purchased and may be increased or
decreased by the owner, within limits and subject to conditions, after a Policy
is issued. The amount of the death benefit is not guaranteed.
CASH VALUE The cash value of a Policy is not guaranteed and varies daily to
reflect investment experience. A Policy may be surrendered for its cash value.
The Policy also includes loan and withdrawal provisions.
DEDUCTIONS AND CHARGES
FROM PREMIUMS
- Deduction of 3.6% for local, state and federal taxes attributable to
premiums
- Sales load of 6.4% up to the Target Premium in Policy years 1-10, and
2.4% of all other premiums
FROM POLICY VALUE
- Cost of insurance charge deducted monthly, is based on the net amount
at risk, Policy duration, and the issue age, sex and risk
classification of the insured persons. Current charges are based on
the experience of Northwestern Mutual Life. Maximum charges are based
on the 1980 CSO Mortality Tables.
- Monthly mortality and expense risk charge. This consists of two
components:
(1) THE INVESTED ASSETS COMPONENT - The current charge is at the
annual rate of .45% (0.0375% monthly rate) of the Policy Value less
any Policy debt. The maximum charge is at the annual rate of .90%
(0.075% monthly rate).
(2) THE SPECIFIED AMOUNT COMPONENT - The charge is based on the
Specified Amount and the issue ages of the insured persons, and
applies during the first 10 Policy years.
- Monthly administrative charge. The current charge is $5.00. The
maximum charge is $7.50.
- Monthly underwriting and issue charge. The charge is based on the
Specified Amount and risk classification of the insured persons. It
applies during the first 10 Policy years. The range is from 1.5CENTS
to 3.5CENTS per $1,000 of initial Specified Amount, with a maximum
monthly charge of $75 to $175.
2
<PAGE>
- Deferred sales charge deducted monthly. The charge is 7.5% (0.625%
monthly rate) of premiums paid during the first Policy year up to
the Target Premium. During the first Policy year the monthly
deduction is based on cumulative premiums paid to date up to the
Target Premium. The charge applies during the first 10 Policy
years.
- Charge for expenses and taxes associated with the Policy loan, if any.
The aggregate charge is at the current annual rate of .90% (0.075%
monthly rate) of the Policy debt during the first ten Policy years and
.35% (.029167%) thereafter.
- Any transaction charges that may result from a withdrawal, a transfer,
a change in the Specified Amount or a change in the death benefit
option. These charges are currently waived. The maximum charge is
$250 for death benefit option changes and $25 for each of the other
transactions.
FROM SURRENDER PROCEEDS
- A surrender charge equal to 50% of the first year premium or the
Target Premium, whichever is less. Beginning with the second Policy
year, the surrender charge reduces month by month to zero at the end
of the tenth Policy year.
FROM THE FUND
- A daily charge for investment advisory and other services provided to
the Fund. The total Fund expenses vary by Portfolio and currently
fall in an approximate range of .21% to .77% of assets on an annual
basis.
The following table shows the annual expenses for each of the Portfolios of the
Fund, as a percentage of the average net assets of the Portfolio, based on 1997
operations for the Portfolios and their predecessors:
<TABLE>
<CAPTION>
INVESTMENT
ADVISORY OTHER TOTAL
PORTFOLIO FEE EXPENSES EXPENSES
- --------- ------ -------- --------
<S> <C> <C> <C>
Aggressive Growth
Stock....................... .52% .01% .53%
International Equity.......... .67% .10% .77%
Growth Stock ................. .47% .02% .49%
Growth and Income
Stock....................... .59% .01% .60%
Index 500 Stock............... .20% .01% .21%
Balanced...................... .30% .00% .30%
High Yield Bond............... .52% .03% .55%
Select Bond................... .30% .00% .30%
Money Market.................. .30% .00% .30%
</TABLE>
- --------------------------------------------------------------------------------
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY,
NORTHWESTERN MUTUAL VARIABLE LIFE ACCOUNT AND
NORTHWESTERN MUTUAL SERIES FUND, INC.
NORTHWESTERN MUTUAL LIFE
The Northwestern Mutual Life Insurance Company is a mutual life insurance
company organized by a special act of the Wisconsin Legislature in 1857. It is
the nation's fifth largest life insurance company, based on total assets in
excess of $71 billion on December 31, 1997, and is licensed to conduct a
conventional life insurance business in the District of Columbia and in all
states of the United States. Northwestern Mutual Life sells life and disability
insurance policies and annuity contracts through its own field force of
approximately 6,000 full time producing agents. The Internal Revenue Service
Employer Identification Number of Northwestern Mutual Life is 39-0509570.
THE ACCOUNT
Northwestern Mutual Variable Life Account was established by the Trustees of
Northwestern Mutual Life on November 23, 1983, in accordance with the provisions
of Wisconsin insurance law. Under Wisconsin law the income, gains and losses,
realized or unrealized, of the Account are credited to or charged against the
assets of the Account without regard to other income, gains or losses of
Northwestern Mutual Life. The Account is used only for variable life insurance
policies, including the Policies described in this prospectus as well as other
policy series.
The Account is registered as a unit investment trust under the Investment
Company Act of 1940. Such registration does not involve supervision of
management or investment practices or policies. The Account has nine divisions.
All of the assets of each division are invested in shares of the corresponding
Portfolio of the Fund described below.
THE FUND
Northwestern Mutual Series Fund, Inc. is a mutual fund of the series type
registered under the Investment Company Act of 1940 as an open-end diversified
management investment company. Shares of each Portfolio of the Fund are
purchased by the corresponding division of the Account at their net asset value
without any sales charge.
The investment adviser for the Fund is Northwestern Mutual Investment Services,
LLC ("NMIS"), a wholly-owned subsidiary of Northwestern Mutual Life. The
investment advisory agreements for the respective Portfolios provide that NMIS
will provide services and bear certain expenses of the Fund. For providing
investment advisory and other services and bearing Fund
3
<PAGE>
expenses, the Fund pays NMIS a fee at an annual rate which ranges from .20% of
the aggregate average daily net assets of the Index 500 Stock Portfolio to a
maximum of .67% for the International Equity Portfolio, based on 1997 asset
size. Other expenses borne by the Portfolios range from 0% for the Select Bond,
Money Market and Balanced Portfolios to .10% for the International Equity
Portfolio. Northwestern Mutual Life provides certain personnel and facilities
used by NMIS in performing its investment advisory functions and is a party to
the investment advisory agreement. J.P. Morgan Investment Management, Inc. and
Templeton Investment Counsel, Inc. have been retained under investment
sub-advisory agreements to provide investment advice to the Growth and Income
Stock Portfolio and the International Equity Portfolio, respectively.
The investment objectives and types of investments for each of the nine
Portfolios of the Fund are set forth below. There can be no assurance that the
objectives of the Portfolios will be realized. For more information about the
investment objectives and policies, the attendant risk factors and expenses, see
the Fund prospectus.
AGGRESSIVE GROWTH STOCK PORTFOLIO. The investment objective of the Aggressive
Growth Stock Portfolio is to achieve long-term appreciation of capital primarily
by investing in the common stocks of companies which can reasonably be expected
to increase their sales and earnings at a pace which will exceed the growth rate
of the nation's economy over an extended period.
INTERNATIONAL EQUITY PORTFOLIO. The investment objective of the International
Equity Portfolio is long-term capital growth. It pursues its objective through
a flexible policy of investing in stocks and debt securities of companies and
governments outside the United States.
GROWTH STOCK PORTFOLIO. The investment objective of the Growth Stock Portfolio
is long-term growth of capital; current income is secondary. The Portfolio will
seek to achieve this objective by selecting investments in companies which have
above average earnings growth potential.
GROWTH AND INCOME STOCK PORTFOLIO. The investment objective of the Growth and
Income Stock Portfolio is long-term growth of capital and income. Ordinarily
the Portfolio pursues its investment objectives by investing primarily in
dividend-paying common stock.
INDEX 500 STOCK PORTFOLIO. The investment objective of the Index 500 Stock
Portfolio is to achieve investment results that approximate the performance of
the Standard & Poor's 500 Composite Stock Price Index ("S&P 500 Index"). The
Portfolio will attempt to meet this objective by investing in stocks included in
the S&P 500 Index. Stocks generally are more volatile than debt securities and
involve greater investment risks.
BALANCED PORTFOLIO. The investment objective of the Balanced Portfolio is to
realize as high a level of long-term total rate of return as is consistent with
prudent investment risk. The Balanced Portfolio will invest in common stocks and
other equity securities, bonds and money market instruments. Investment in the
Balanced Portfolio necessarily involves the risks inherent in stocks and debt
securities of varying maturities, including the risk that the Portfolio may
invest too much or too little of its assets in each type of security at any
particular time.
HIGH YIELD BOND PORTFOLIO. The investment objective of the High Yield Bond
Portfolio is to achieve high current income and capital appreciation by
investing primarily in fixed income securities that are rated below investment
grade by the major rating agencies.
SELECT BOND PORTFOLIO. The primary investment objective of the Select Bond
Portfolio is to provide as high a level of long-term total rate of return as is
consistent with prudent investment risk. A secondary objective is to seek
preservation of shareholders' capital. The Select Bond Portfolio will invest
primarily in debt securities. The value of debt securities will tend to rise and
fall inversely with the rise and fall of interest rates.
MONEY MARKET PORTFOLIO. The investment objective of the Money Market Portfolio
is to realize maximum current income consistent with liquidity and stability of
capital. The Money Market Portfolio will invest in money market instruments and
other debt securities with maturities generally not exceeding one year. The
return produced by these securities will reflect fluctuations in short-term
interest rates.
- --------------------------------------------------------------------------------
DETAILED INFORMATION ABOUT THE POLICY
PREMIUMS
The Policy permits premiums to be paid at any time before the Policy anniversary
that is nearest the 95th birthday of the younger insured and in any amounts
within the limits described in this section.
4
<PAGE>
The Specified Amount selected when the Policy is purchased is used to determine
the minimum initial premium. The minimum initial premium varies with the issue
age and sex of the insured persons.
A Target Premium is calculated when the Policy is issued and is used in
determining the sales load, commissions, surrender charge and other expense
charges during the first 10 Policy years. The Target Premium is based on the
Specified Amount and the age, sex and risk classification of the insured
persons.
After a Policy is issued, there are no minimum premiums, except that no premium
of less than $25 will be accepted. The Policy will remain in force during the
lifetime of at least one of the insured persons so long as the cash value is
sufficient to pay the monthly cost of insurance charge and other current
charges.
The Policy sets no maximum on premiums, but a premium that would increase the
net amount at risk will be accepted only if the insurance, as increased, will be
within the issue limits of Northwestern Mutual Life, the insureds meet the
insurability requirements and the premium is received prior to the anniversary
nearest the older insured's 85th birthday. If the Guideline Premium/Cash Value
Corridor Test has been elected, a premium will not be accepted if it would
disqualify the Policy as life insurance for federal income tax purposes. See
"Choice of Tests for Tax Purposes", below and "Tax Considerations", p. 10.
DEATH BENEFIT
DEATH BENEFIT OPTIONS The death benefit is payable on the second death while
the Policy is in force. The Policy provides for three death benefit options:
SPECIFIED AMOUNT (OPTION A) The Specified Amount is selected by the applicant
when the Policy is purchased.
SPECIFIED AMOUNT PLUS POLICY VALUE (OPTION B) The Policy Value is the
cumulative amount invested, adjusted for investment results, reduced by the
charges for insurance and other expenses.
SPECIFIED AMOUNT PLUS PREMIUMS PAID (OPTION C)
The selected death benefit option will be in effect before the Policy
anniversary nearest the 100th birthday of the younger insured, and the death
benefit will be equal to the Policy Value after that date.
Under any of the Options, or on or after the Policy anniversary nearest the
100th birthday of the younger insured, the death benefit will be increased if
necessary to meet the definitional requirements for life insurance for federal
income tax purposes as discussed below.
CHOICE OF TESTS FOR TAX PURPOSES A Policy must satisfy one of two testing
methods to qualify as life insurance for federal income tax purposes. The
purchaser may choose either the Guideline Premium/Cash Value Corridor Test or
the Cash Value Accumulation Test. Both tests require the Policy to meet minimum
ratios, or multiples, of death benefit to the Policy Value. The minimum
multiple decreases as the age of the insured persons advances. The choice of
testing methods is made when a Policy is purchased and it may not be changed.
For the Guideline Premium/Cash Value Corridor Test the minimum multiples of
death benefit to the Policy Value are shown in the following table. The
attained age of the younger insured is used even if the younger insured is no
longer living.
GUIDELINE PREMIUM/CASH VALUE
CORRIDOR TEST MULTIPLES
YOUNGER INSURED AGE
<TABLE>
<CAPTION>
Attained Policy
- -------- ------
Age Value %
- --- -------
<S> <C>
40 or under...... 250
41............... 243
42............... 236
43............... 229
44............... 222
45............... 215
46............... 209
47............... 203
48............... 197
49............... 191
50............... 185
51............... 178
52............... 171
53............... 164
54............... 157
55............... 150
56............... 146
57............... 142
58............... 138
59............... 134
60............... 130
61............... 128
62............... 126
63............... 124
64............... 122
65............... 120
66............... 119
67............... 118
68............... 117
69............... 116
70............... 115
71............... 113
72............... 111
73............... 109
74............... 107
75-90............ 105
91............... 104
92............... 103
93............... 102
94............... 101
95 or over....... 100
</TABLE>
For the Cash Value Accumulation Test the minimum multiples of death benefit to
the Policy Value are calculated using net single premiums based on the attained
age of both insureds and the Policy's underwriting classification, using a 4%
interest rate.
The Guideline Premium/Cash Value Corridor Test generally has lower minimum
multiples than the Cash Value Accumulation Test, usually resulting in better
cash value accumulation for a given amount of premium. But the Guideline
Premium/Cash Value
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Corridor Test limits the amount of premium that may be paid in each Policy year.
The Cash Value Accumulation Test has no such annual limitation, and allows more
premium to be paid during the early Policy years.
DEATH BENEFIT CHANGES After a Policy is issued the owner may change the death
benefit option, or increase or decrease the Specified Amount, subject to
approval by Northwestern Mutual Life. Changes are subject to insurability
requirements and issue limits. A change will not be permitted if it results in
a Specified Amount less than the minimum for a new Policy issued on that date.
A change in the death benefit option, or an increase or decrease in the
Specified Amount, will be effective on the monthly processing date next
following receipt of a written request at the Home Office of Northwestern Mutual
Life.
Administrative charges of up to $250 for a change in the death benefit option,
and up to $25 for each of more than one change in the Specified Amount in a
Policy year, may apply. Any such charges will be deducted from the Policy
Value. Northwestern Mutual Life is currently waiving these charges.
A change in the death benefit option, or an increase or decrease in the
Specified Amount, may have important tax effects. See "Tax Considerations", p.
10. The cost of insurance charge will increase if a change results in a larger
net amount at risk. See "Charges Against the Policy Value," below.
ALLOCATIONS TO THE ACCOUNT
The initial net premium is placed in the Account on the Policy date. Net
premiums paid thereafter are placed in the Account on the date received at the
Home Office of Northwestern Mutual Life. Net premiums are premiums less the
deductions from premiums. See "Deductions from Premiums", below.
Premiums placed in the Account prior to the initial allocation date are invested
in the Money Market Division of the Account. The initial allocation date is
identified in the Policy and is the later of the date the application is
approved by Northwestern Mutual Life and the date the initial premium is
received at the Home Office of Northwestern Mutual Life. A different initial
allocation date applies in those states which require a refund of at least the
premium paid during the period when the Policy may be returned. See "Right to
Return Policy," p. 8. On the initial allocation date the amount in the Money
Market Division is invested in the Account divisions as directed in the
application for the Policy. The owner may change the allocation for future net
premiums at any time by written request and the change will be effective for
premiums placed in the Account thereafter. Allocation must be in whole
percentages.
The owner may transfer accumulated amounts from one division of the Account to
another. Transfers are effective on the date a written request is received at
the Home Office of Northwestern Mutual Life. Northwestern Mutual Life reserves
the right to charge a fee of up to $25, to cover administrative costs of
transfers, if there are more than twelve transfers in a Policy year.
Northwestern Mutual Life is currently waiving these fees.
DEDUCTIONS AND CHARGES
DEDUCTIONS FROM PREMIUMS A charge for taxes attributable to premiums is
deducted from each premium. The total amount of this deduction is 3.6% of the
premium. Of this amount 2.35% is for state premium taxes. Premium taxes vary
from state to state and currently range from .75% to 3.5% of life insurance
premiums. The 2.35% rate is an average. The tax rate for a particular state
may be lower, higher, or equal to the 2.35% deduction. Northwestern Mutual Life
does not expect to profit from this charge. The remainder of the deduction,
1.25% of each premium, is for federal income taxes measured by premiums.
Northwestern Mutual Life believes that this charge does not exceed a reasonable
estimate of its federal income taxes attributable to the treatment of deferred
acquisition costs. The charge for taxes may be changed to reflect any changes
in the law.
A charge for sales costs is deducted from each premium. The charge is 6.4% of
premiums paid during each of the first ten Policy years up to the Target Premium
and 2.4% of all other premiums. The Target Premium is based on the Specified
Amount and the issue age, sex and risk classification of the insured persons.
To the extent that sales expenses exceed the amounts deducted, Northwestern
Mutual Life will pay the expenses from its other assets. These assets may
include, among other things, any gain realized from the monthly charge against
the Policy Value for the mortality and expense risks assumed by Northwestern
Mutual Life, as described below.
CHARGES AGAINST THE POLICY VALUE A cost of insurance charge is deducted from
the Policy Value on each monthly processing date. The amount is determined by
multiplying the net amount at risk by the cost of insurance rate. The net
amount at risk is equal to the death benefit currently in effect less the Policy
Value. The cost of insurance rate reflects the policy duration, and the issue
age, sex and risk classification of the insured persons. The maximum cost of
insurance rates are included in the Policy.
A charge for the mortality and expense risks assumed by Northwestern Mutual Life
is also deducted monthly from the Policy Value. This charge includes the
invested assets component and the Specified Amount component. The maximum
amount of the invested
6
<PAGE>
assets component is equal to an annual rate of .90% (0.075% monthly rate) of the
Policy Value. Currently the charge is equal to an annual rate of .45% (0.0375%
monthly rate) of the Policy Value. The Specified Amount component is based on
the Specified Amount and the issue ages of the insured persons, and applies
during the first 10 Policy years. A table of rates and an example are included
in Appendix B, p. 46. The mortality risk is that insureds may not live as long
as Northwestern Mutual Life estimated. The expense risk is that expenses of
issuing and administering the Policies may exceed the estimated costs.
Northwestern Mutual Life will realize a gain from this charge to the extent it
is not needed to provide benefits and pay expenses under the Policies.
There is a monthly administrative charge of not more than $7.50. Currently this
charge will be $5. This charge is for administrative expenses, including costs
of premium collection, processing claims, keeping records and communicating with
Policyowners. Northwestern Mutual Life does not expect to profit from this
charge.
There is a monthly underwriting and issue charge bases on the Specified Amount
and the risk classification of the insureds. This charge applies during the
first 10 Policy years. The range is from 1.5CENTS to 3.5CENTS per $1000 of
initial Specified Amount, with a maximum monthly charge of $75 to $175.
A deferred sales charge is deducted monthly. The charge is 7.5% (0.625%
monthly rate) of premiums paid during the first Policy year up to the Target
Premium. During the first Policy year the monthly deduction is based on
cumulative premiums paid to date up to the Target Premium. The charge applies
during the first 10 Policy years.
A charge is made for the expenses and taxes associated with the Policy debt, if
any. The aggregate charge is at the current annual rate of 0.90% (0.075%
monthly rate) of the Policy debt for the first ten Policy years and 0.35%
(0.029167% monthly rate) thereafter.
The Policy provides for transaction fees to be deducted from the Policy Value on
the dates on which transactions take place. These charges are $25 for changes
in the Specified Amount, withdrawals or transfers of assets among the divisions
of the Account if more than twelve transfers take place in a Policy year. The
fee for a change in the death benefit option is $250. Currently all of these
fees are being waived.
Deductions from the Policy Value will be apportioned among the divisions of the
Account in proportion to the amounts invested in the divisions.
SURRENDER CHARGE. A surrender charge will be deducted from the Policy proceeds
if the Policy is surrendered during the first ten Policy years. During the
first Policy year the surrender charge is equal to 50% of the first year premium
or the Target Premium, whichever is less. Beginning with the second Policy year
the surrender charge reduces month by month to zero at the end of the tenth
Policy year.
EXPENSES OF THE FUND The investment performance of each division of the Account
reflects all expenses borne by the corresponding Portfolio of the Fund. See the
attached Fund prospectus for more information about those expenses.
CASH VALUE
The owner of a Policy may surrender it for the cash value at any time during the
lifetime of at least one of the insured persons. The cash value for the Policy
will change daily in response to investment results. No minimum cash value is
guaranteed. The cash value is equal to the Policy Value, reduced by the
surrender charge and reduced by any Policy debt outstanding.
The cash value for a Policy is determined at the end of each valuation period.
Each business day, together with any non-business days before it, is a valuation
period. A business day is any day on which the New York Stock Exchange is open
for trading. In accordance with the requirements of the Investment Company Act
of l940, the cash value for a Policy may also be determined on any other day on
which there is sufficient trading in securities to materially affect the value
of the securities held by the Portfolios of the Fund.
POLICY LOANS
The owner of a Policy may borrow up to 90% of the Policy Value less the
surrender charge on the date of the loan, using the Policy as security. If a
Policy loan is already outstanding, the maximum amount for any new loan is
reduced by the amount already borrowed.
Interest on a Policy loan accrues and is payable on a daily basis at an annual
effective rate of 5%. Unpaid interest is added to the amount of the loan. If the
amount of the loan plus the surrender charge equals or exceeds the Policy Value
on a monthly processing date, the Policy will enter the grace period. See
"Termination and Reinstatement", below. A notice will be sent to the owner at
least 61 days before the termination date. The notice will show how much must be
paid to keep the Policy in force.
The amount of a Policy loan will be taken from the Account divisions in
proportion to the amounts in the divisions. The amounts withdrawn will be
transferred to Northwestern Mutual Life's general account and will be credited
on a daily basis with an annual earnings rate equal to the 5% Policy loan
interest rate. A Policy loan, even if it is repaid, will have a permanent effect
on the Policy Value because the amounts borrowed will not participate in the
Account's investment results while the loan is outstanding. The effect may be
either favorable or unfavorable depending on whether the earnings rate credited
to the loan amount is higher or lower than the rate credited to the unborrowed
amount left in the Account.
A Policy loan, and any accrued interest outstanding, may be repaid, in whole or
in part, at any time. Payments will be credited as of the date received and
7
<PAGE>
will be transferred from the general account of Northwestern Mutual Life to the
Account divisions, in proportion to the premium allocation in effect, as of the
same date.
A Policy loan may have important tax consequences. See "Tax Considerations", p.
10.
WITHDRAWALS OF CASH VALUE
The owner may make a withdrawal of cash value. A withdrawal may not reduce the
loan value to less than any Policy debt outstanding. The loan value is 90% of
the Policy Value less the surrender charge. Following a withdrawal the remaining
cash value must be at least three times the current monthly charges for the cost
of insurance and other expenses. The minimum amount for withdrawals is $250. Up
to four withdrawals are permitted in a Policy year. An administrative charge of
up to $25 may apply, but is currently being waived.
A withdrawal of cash value decreases the death benefit by the same amount. If
the death benefit for a Policy has been increased to meet the federal tax
requirements for life insurance, the decrease in the death benefit caused by a
subsequent withdrawal will be larger than the amount of the withdrawal. If
Option A or Option C is in effect a withdrawal of cash value will reduce the
Specified Amount by the amount of the withdrawal. Following a withdrawal the
remaining death benefit must be at least the minimum amount that Northwestern
Mutual Life would currently issue, or the initial Specified Amount, if greater.
The amount withdrawn from cash value will be taken from the Account divisions in
proportion to the amounts in the divisions. The Policy makes no provision for
repayment of amounts withdrawn. A withdrawal of cash value may have important
tax consequences. See "Tax Considerations", p. 10.
TERMINATION AND REINSTATEMENT
If the cash value is less than the monthly charges for the cost of insurance and
other expenses on any monthly processing date, a grace period of 61 days is
allowed for the payment of sufficient premium to keep the Policy in force. The
grace period begins on the date that a notice is sent to the owner. The notice
will state the minimum amount of premium required to keep the Policy in force
and the date by which the premium must be paid. The Policy will terminate with
no value unless the required amount is paid before the grace period expires.
After a Policy has terminated, it may be reinstated within three years. The
insureds must provide satisfactory evidence of insurability. The minimum amount
of premium required for reinstatement will be the monthly charges that were due
when the Policy terminated plus the charges for three more months.
Reinstatement of a Policy will be effective on the first monthly processing date
after an application for reinstatement is received at the Home Office of
Northwestern Mutual Life, subject to approval by Northwestern Mutual Life. Any
Policy debt that was outstanding when the Policy terminated will also be
reinstated.
The Policy Value when a Policy is reinstated is equal to the premium paid, after
the deduction for taxes and sales load, plus any Policy debt, less the sum of
all monthly charges for the cost of insurance and other expenses for the grace
period and for the current month. The Policy Value, less any Policy debt, will
be allocated among the Account divisions based on the allocation for premiums
currently in effect.
A Policy may not be reinstated after the Policy has been surrendered for its
cash value or if either of the insured persons has died after the end of the
grace period.
See "Tax Considerations", p. 10, for a discussion of the tax effects associated
with termination and reinstatement of a Policy.
RIGHT TO RETURN POLICY
A Policy may be returned within 10 days (or later where required by state law)
after the Policy is received. In some states the Policy may be returned within
45 days after the application for insurance is signed. The Policy may be mailed
or delivered to the agent who sold it or to the Home Office of Northwestern
Mutual Life. If returned, the Policy will be considered void from the
beginning. Northwestern Mutual Life will refund the sum of the amounts deducted
from the premium paid plus the Policy Value less any Policy debt on the date the
returned Policy is received. In some states, the amount refunded will not be
less than the premium paid.
OTHER POLICY PROVISIONS
OWNER. The owner is identified in the Policy. The owner may exercise all rights
under the Policy while at least one of the insured persons is living. Ownership
may be transferred to another. Written proof of the transfer must be received by
Northwestern Mutual Life at its Home Office.
BENEFICIARY. The beneficiary is the person to whom the death benefit is
payable. The beneficiary is named in the application. After the Policy is issued
the owner may change the beneficiary in accordance with the Policy provisions.
INCONTESTABILITY. Northwestern Mutual Life will not contest a Policy after it
has been in force during the lifetime of at least one insured for two years from
the date of issue or two years from the effective date of a reinstatement. An
increase in the amount of insurance that was subject to insurability
requirements will not
8
<PAGE>
be contested after the increased amount has been in force during the lifetime of
at least one insured for two years from the date of issuance of the increase.
SUICIDE. If either insured dies by suicide within one year from the date of
issue, the amount payable under the Policy will be limited to the premiums paid,
less the amount of any Policy debt and withdrawals. If either insured dies by
suicide within one year of the date of issuance of an increase in the amount of
insurance, which was subject to insurability requirements, the amount payable
with respect to the increase will be limited to the amounts charged for the cost
of insurance and other expenses attributable to the increase.
MISSTATEMENT OF AGE OR SEX. If the age or sex of either of the insureds has
been misstated, the charges for cost of insurance and other expenses under a
Policy will be adjusted to reflect the correct age and sex of both insured
persons.
COLLATERAL ASSIGNMENT. The owner may assign a Policy as collateral security.
Northwestern Mutual Life is not responsible for the validity or effect of a
collateral assignment and will not be deemed to know of an assignment before
receipt of the assignment in writing at the Home Office.
DEFERRAL OF DETERMINATION AND PAYMENT. Northwestern Mutual Life will ordinarily
pay Policy benefits within seven days after receipt of all required documents at
its Home Office. However, determination and payment of benefits may be deferred
during any period when it is not reasonably practicable to value securities
because the New York Stock Exchange is closed or an emergency exists or the
Securities and Exchange Commission, by order, permits deferral for the
protection of Policyowners.
DIVIDENDS. The Policies will share in divisible surplus to the extent
determined annually by Northwestern Mutual Life. Since the Policies are not
expected to contribute to divisible surplus, it is not expected that any
dividends will be paid.
VOTING RIGHTS
Northwestern Mutual Life is the owner of the Fund shares in which all assets of
the Account are invested. As the owner of the shares Northwestern Mutual Life
will exercise its right to vote the shares to elect directors of the Fund, to
vote on matters required to be approved or ratified by mutual fund shareholders
under the Investment Company Act of 1940 and to vote on any other matters that
may be presented to any Fund shareholders' meeting. However, Northwestern Mutual
Life will vote the Fund shares held in the Account in accordance with
instructions from owners of the Policies. Northwestern Mutual Life will vote the
Fund shares held in its general account in the same proportions as the shares
for which voting instructions are received. If the applicable laws or
regulations change so as to permit Northwestern Mutual Life to vote the Fund
shares in its own discretion, it may elect to do so.
The number of Fund shares for each division of the Account for which the owner
of a Policy may give instructions is determined by dividing the amount of the
Policy Value apportioned to that division, if any, by the per share value for
the corresponding Fund Portfolio. The number will be determined as of a date
chosen by Northwestern Mutual Life, but not more than 90 days before the Fund
shareholders' meeting. Fractional votes are counted. Voting instructions will be
solicited with written materials at least 14 days before the meeting. Shares as
to which no instructions have been received will be voted in the same proportion
as the shares as to which instructions have been received.
Northwestern Mutual Life may, if required by state insurance officials,
disregard voting instructions which would require Fund shares to be voted for a
change in the sub-classification or investment objectives of a Fund Portfolio,
or to approve or disapprove an investment advisory agreement for the Fund.
Northwestern Mutual Life may also disregard voting instructions that would
require changes in the investment policy or investment adviser for the Fund or a
Fund Portfolio, provided that Northwestern Mutual Life reasonably determines to
take this action in accordance with applicable federal law. If Northwestern
Mutual Life disregards voting instructions, a summary of the action and reasons
therefor will be included in the next semiannual report to the owners of the
Policies.
SUBSTITUTION OF FUND SHARES AND OTHER CHANGES
If, in the judgment of Northwestern Mutual Life, a Fund Portfolio becomes
unsuitable for continued use with the Policies because of a change in investment
objectives or restrictions, shares of another Portfolio or another mutual fund
may be substituted. Any substitution of shares will be subject to any required
approval of the Securities and Exchange Commission, the Wisconsin Commissioner
of Insurance or other regulatory authority. Northwestern Mutual Life has also
reserved the right, subject to applicable federal and state law, to operate the
Account or any of its divisions as a management company under the Investment
Company Act of 1940, or in any other form permitted, or to terminate
registration of the Account if registration is no longer required, and to change
the provisions of the Policies to comply with any applicable laws.
9
<PAGE>
REPORTS
At least once each Policy year the owner of a Policy will receive a statement
showing the death benefit, cash value, Policy Value and any Policy loan,
including loan interest. This report will show the apportionment of invested
assets among the Account divisions. Owners will also receive annual and
semiannual reports for the Account and the Fund, including financial statements.
DISTRIBUTION OF THE POLICIES
The Policies will be sold through individuals who, in addition to being licensed
life insurance agents of Northwestern Mutual Life, are registered
representatives of Northwestern Mutual Investment Services, LLC ("NMIS"), a
wholly-owned subsidiary of Northwestern Mutual Life. NMIS is a registered
broker-dealer under the Securities Exchange Act of 1934 and is a member of the
National Association of Securities Dealers. NMIS was organized in 1968 and is a
Wisconsin limited liability company. Its address is 720 East Wisconsin Avenue,
Milwaukee, Wisconsin 53202. The Internal Revenue Service Employer
Identification Number of NMIS is 39-1099296.
Commissions paid to the agents will not exceed 40% of the premium up to the
Target Premium for the first year, 6% of the premium up to the Target Premium
during Policy years 2-10, and 2.75% of all other premium. Agents also receive
commissions equal to .10% of Policy Value less Policy debt in Policy years 6 and
later.
General agents and district agents who are registered representatives of NMIS
and have supervisory responsibility for sales of the Policies receive commission
overrides and other compensation.
TAX CONSIDERATIONS
GENERAL The following discussion provides a general description of federal
income tax considerations relating to the Policy. The discussion is based on
current provisions of the Internal Revenue Code ("Code") as currently
interpreted by the Internal Revenue Service. This discussion is not intended as
tax advice. The discussion is not exhaustive, it does not address the
likelihood of future changes in federal income tax law or interpretations
thereof, and it does not address state or local tax considerations which may be
significant in the purchase and ownership of a Policy.
LIFE INSURANCE QUALIFICATION Section 7702 of the Code defines life insurance
for federal income tax purposes. The Code provides two alternative tests for
determining whether the death benefit is a sufficient multiple of the Policy
Value. See "Choice of Tests for Tax Purposes", p. 5. The Policy is designed to
comply with these rules. Premiums that would cause a Policy to be disqualified
as life insurance will be returned.
Section 817(h) of the Code authorizes the Secretary of the Treasury to set
standards for diversification of the investments underlying variable life
insurance policies. Final regulations have been issued pursuant to this
authority. Failure to meet the diversification requirements would disqualify
the Policies as life insurance for purposes of Section 7702 of the Code.
Northwestern Mutual Life intends to comply with these requirements.
The Treasury Department, in connection with the diversification requirements,
stated that it expected to issue guidance about circumstances where a
policyowner's control of separate account assets would cause the policyowner,
and not the life insurance company, to be treated as the owner of those assets.
These guidelines have not been issued. If the owner of a Policy were treated as
the owner of the Fund shares held in the Account, the income and gains related
to those shares would be included in the owner's gross income for federal income
tax purposes. Northwestern Mutual Life believes that it owns the assets of the
Account under current federal income tax law.
Northwestern Mutual Life believes that the Policies comply with the provisions
of Sections 7702 and 817(h) of the Code, but the application of these rules is
not entirely clear. Northwestern Mutual Life may make changes in the Policies
if necessary to qualify the Policies as life insurance for tax purposes.
TAX TREATMENT OF LIFE INSURANCE While a Policy is in force, increases in the
Policy Value as a result of investment experience are not subject to federal
income tax until there is a distribution as defined by the Code. The death
benefit received by a beneficiary will not be subject to federal income tax.
Unless the Policy is a modified endowment contract, as described below,
Northwestern Mutual Life believes that a loan received under a Policy will be
construed as indebtedness of the owner and no part of the loan will be treated
as a distribution subject to current federal income tax. Interest paid by
owners of the Policies will ordinarily not be deductible.
As a general rule, the proceeds from a withdrawal of cash value will be taxable
only to the extent that the withdrawal exceeds the basis of the Policy. The
basis of the Policy is generally equal to the premiums paid less any amounts
previously received as tax-free distributions. In certain circumstances, a
withdrawal of cash value during the first 15 Policy years may be taxable to the
extent that the cash value exceeds the basis of the Policy. This means that the
amount withdrawn may be taxable even if that amount is less than the basis of
the Policy. In addition, if a Policy terminates while a Policy loan is
outstanding, the
10
<PAGE>
cancellation of the loan and accrued interest will be treated as a distribution
from the Policy and may be taxable under these rules.
Special tax rules may apply when ownership of a Policy is transferred.
Qualified tax advice should be sought when a transfer of ownership is planned.
MODIFIED ENDOWMENT CONTRACTS A Policy will be classified as a modified
endowment contract if the cumulative premium paid during the first seven Policy
years exceeds a defined "seven-pay" limit. The seven-pay limit is based on a
hypothetical life insurance policy issued on the same insured person and for the
same initial death benefit which, under specified conditions (which include the
absence of expense and administrative charges) will be fully paid for after
seven level annual payments. A Policy will be treated as a modified endowment
contract unless cumulative premiums paid under the Policy, at all times during
the first seven Policy years, are less than or equal to the cumulative seven-pay
premiums which would have been paid under the hypothetical policy on or before
such times.
Whenever there is a "material change" under a Policy, it will generally be
treated as a new contract for purposes of determining whether the Policy is a
modified endowment contract, and subjected to a new seven-pay period and a new
seven-pay limit. The new seven-pay limit would be determined taking into
account the Policy Value of the Policy at the time of such change. A materially
changed Policy would be considered a modified endowment contract if it failed to
satisfy the new seven-pay limit. A material change could occur as a result of a
change in the death benefit option, a change in the Specified Amount, and
certain other changes.
If the benefits are reduced during the lifetime of either insured, for example,
by requesting a decrease in the Specified Amount or, in some cases, by making a
withdrawal of cash value, the seven-pay premium limit will be redetermined based
on the reduced level of benefits and applied retroactively for purposes of the
seven-pay test. If the premiums previously paid are greater than the calculated
seven-pay premium level limit, the Policy will become a modified endowment
contract. A life insurance policy which is received in exchange for a modified
endowment contract will also be considered a modified endowment contract.
If a Policy is a modified endowment contract, any distribution from the Policy
will be taxed on a gain- first basis. Distributions for this purpose include a
loan (including any increase in the loan amount to pay interest on an existing
loan or an assignment or a pledge to secure a loan) or a withdrawal of cash
value. Any such distributions will be considered taxable income to the extent
the cash value exceeds the basis in the Policy. For modified endowment
contracts, the basis would be increased by the amount of any prior loan under
the Policy that was considered taxable income. For purposes of determining the
taxable portion of any distribution, all modified endowment contracts issued by
Northwestern Mutual Life to the same policyowner (excluding certain qualified
plans) during any calendar year are to be aggregated. The Secretary of the
Treasury has authority to prescribe additional rules to prevent avoidance of
gain-first taxation on distributions from modified endowment contracts.
A 10% penalty tax will apply to the taxable portion of a distribution from a
modified endowment contract. The penalty tax will not, however, apply to
distributions (i) to taxpayers 59 1/2 years of age or older, (ii) in the case of
a disability (as defined in the Code) or (iii) received as part of a series of
substantially equal periodic annuity payments for the life (or life expectancy)
of the taxpayers or the joint lives (or joint life expectancies) of the taxpayer
and his beneficiaries. If a Policy is surrendered, the excess, if any, of the
Policy Value over the basis of the Policy will be subject to federal income tax
and, unless one of the above exceptions applies, the 10% penalty tax. The
exceptions generally do not apply to life insurance policies owned by
corporations or other entities. If a Policy terminates while there is a Policy
loan, the cancellation of the loan and accrued loan interest will be treated as
a distribution to the extent not previously treated as such and could be subject
to tax, including the penalty tax, as described under the above rules.
If a Policy becomes a modified endowment contract, distributions that occur
during the Policy year it becomes a modified endowment contract and any
subsequent Policy year will be taxed as described in the two preceding
paragraphs. In addition, distributions from a Policy within two years before it
becomes a modified endowment contract will be subject to tax in this manner.
This means that a distribution made from a Policy that is not a modified
endowment contract could later become taxable as a distribution from a modified
endowment contract. The Secretary of the Treasury has been authorized to
prescribe rules which would treat similarly other distributions made in
anticipation of a policy becoming a modified endowment contract.
ESTATE AND GENERATION SKIPPING TAXES The amount of the death benefit will
generally be includible in the owner's estate for federal estate tax purposes if
the last surviving insured owned the Policy. If the owner is not the last
surviving insured, the fair market value of the Policy is includible in the
owner's estate.
The federal estate tax and gift tax are integrated under a unified rate schedule
which effectively excludes estates of less than $625,000 from federal estate
taxes. The exclusion will be increased in several steps to $1 million in the
year 2006 under current law. In
11
<PAGE>
addition, an unlimited marital deduction permits deferral of federal estate and
gift taxes until the death of the surviving spouse.
If ownership of the Policy is transferred to a person two or more generations
younger than the owner, the value of the Policy may be taxable. Individuals are
generally allowed an aggregate generation skipping tax exemption of $1 million.
A qualified tax adviser should be consulted if transfer of ownership to
grandchildren is contemplated.
OTHER TAX CONSIDERATIONS The Policy permits the owner to exchange the Policy
for two policies, one on the life of each insured, if a change in the federal
estate tax law results in the repeal of the unlimited marital deduction or a 50%
or greater reduction in the estate tax rate. The Internal Revenue Service has
ruled with respect to one taxpayer that such a transaction would be treated as a
non-taxable exchange. If not, such a split of the Policy could result in the
recognition of taxable income.
Depending on the circumstances, the exchange of a Policy, a change in the death
benefit option, a Policy loan, a withdrawal of cash value, a change in ownership
or an assignment of the Policy may have federal income tax consequences. In
addition, federal, state and local transfer, estate, inheritance, and other tax
consequences of Policy ownership, premium payments and receipt of Policy
proceeds depend on the circumstances of each Policyowner or beneficiary. Any
person contemplating any such transaction should consult a qualified tax
adviser.
- --------------------------------------------------------------------------------
OTHER INFORMATION
MANAGEMENT
Northwestern Mutual Life is managed by a Board of Trustees. The Trustees and
senior officers of Northwestern Mutual Life and their positions including Board
committee memberships, and their principal occupations, as of the date of this
prospectus, are listed below. Unless otherwise indicated, the business address
of each Trustee and senior officer is c/o The Northwestern Mutual Life Insurance
Company, 720 East Wisconsin Avenue, Milwaukee, Wisconsin 53202.
<TABLE>
<CAPTION>
TRUSTEES
NAME PRINCIPAL OCCUPATION DURING LAST FIVE YEARS
- ---- -------------------------------------------
<S> <C>
R. Quintus Anderson (A)................................... Chairman, Aarque Capital Corporation since 1997, prior thereto;
Chairman, The Aarque Companies, 111 West Second Street, P.O. Box 310,
Jamestown, NY 14702-0310 (diversified metal products manufacturing)
Edward E. Barr (HR)....................................... Chairman, Sun Chemical Corporation, 222 Bridge Plaza South, Fort Lee,
New Jersey 07024 (graphic arts) since 1998; prior thereto, President
and Chief Executive Officer. President and Chief Executive Officer, DIC
Americas, Inc., Fort Lee, NJ
Gordon T. Beaham, III (OT)................................ Chairman of the Board and President, Faultless Starch/Bon Ami Company,
1025 West Eighth Street, Kansas City, MO 64101 (consumer products
manufacturer)
Robert C. Buchanan (A, E, F).............................. President and Chief Executive Officer, Fox Valley Corporation, 100 West
Lawrence Street, P.O. Box 727, Appleton, WI 54912-0727 (manufacturer of
gift wrap and writing paper)
Robert E. Carlson (E)..................................... Executive Vice President of Northwestern Mutual Life
George A. Dickerman (AM).................................. Chairman of the Board, Spalding Sports Worldwide, 425 Meadow Street,
P.O. Box 901, Chicopee, MA 01021-0901 (manufacturer of sporting
equipment) since 1998; prior thereto, President
Pierre S. du Pont (AM).................................... Attorney, Richards, Layton and Finger, P.O. Box 551, 1 Rodney Square,
Wilmington, DE 19899
</TABLE>
12
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
James D. Ericson (AM, E, F. HR, OT)....................... President and Chief Executive Officer of Northwestern Mutual Life since
1993; President and Chief Operating Officer, 1991-1993; prior thereto,
President
J. E. Gallegos (A)........................................ Attorney at Law; President, Gallegos Law Firm, 460 St. Michaels Drive,
Building 300, Santa Fe, NM 87505
Stephen N. Graff (E, F, OT)............................... Retired Partner, Arthur Andersen LLP (public accountants) since 1994;
Senior Partner, 1993-1994; prior thereto, Managing Partner - Milwaukee,
WI office. Address: 805 Lone Tree Road, Elm Grove, WI 53122-2014
Patricia Albjerg Graham (HR).............................. Professor, Graduate School of Education, Harvard University, 420 Gutman,
Cambridge, MA 02138. President, The Spencer Foundation (social and
behavioral sciences)
Stephen F. Keller (HR).................................... Attorney. Former Chairman, Santa Anita Realty Enterprises since 1997;
prior thereto, Chairman. Address: 101 South Las Palmas Avenue, Los
Angeles, CA 90004
Barbara A. King (AM)...................................... President, Landscape Structures, Inc., Rt 3, 601 - 7th Street South,
Delano, MN 55328 (manufacturer of playground equipment)
J. Thomas Lewis (HR)...................................... Attorney (retired), 228 St. Charles Avenue, Suite 1024, New Orleans, LA
70130, since 1998; prior thereto, Attorney, Monroe & Lemann, New
Orleans, LA
Daniel F. McKeithan, Jr. (E, F, HR)....................... President, Tamarack Petroleum Company, Inc., 777 East Wisconsin Avenue,
Milwaukee, WI 53202 (operator of oil and gas wells); President, Active
Investor Management, Inc., Milwaukee, WI
Guy A. Osborn (E, F, OT).................................. Retired Chairman of Universal Foods Corporation, 433 East Michigan
Street, Milwaukee, WI 53202 since 1997; prior thereto, Chairman and
Chief Executive Officer
Timothy D. Proctor (A).................................... Director, Worldwide Human Resources of Glaxo Wellcome plc, P.O. Box
13398, 5 Moore Drive, Research Triangle Park, NC 27709, since 1998.
Senior Vice President Human Resources, General Counsel & Secretary from
1994 to 1998 (pharmaceuticals)
Donald J. Schuenke (AM, E, F)............................. Retired since 1994; Chairman of Northwestern Mutual Life, 1993-1994;
Chairman and Chief Executive Officer, 1990-1993; prior thereto,
President and Chief Executive Officer
H. Mason Sizemore, Jr. (AM)............................... President and Chief Operating Officer, The Seattle Times, Fairview
Avenue North and John Street, P.O. Box 70, Seattle, WA 98111
(publishing)
Harold B. Smith (OT)...................................... Chairman, Executive Committee, Illinois Tool Works, Inc., 3600 West Lake
Avenue, Glenview, IL 60025-5811 (engineered components and industrial
systems and consumables)
Sherwood H. Smith, Jr. (AM)............................... Chairman of the Board of Carolina Power & Light, 411 Fayetteville Street
Mall, P.O. Box 1551, Raleigh, NC 27602, since 1997; prior thereto,
Chairman of the Board and Chief Executive Officer.
John E. Steuri (OT)....................................... Chairman, Advanced Thermal Technologies, Little Rock, AR since 1997
(heating, air-conditioning and humidity control). Retired
since 1996 as Chairman and Chief Executive Officer of ALLTEL Information
Services, Inc., Little Rock, AR (application software). Address: 52
River Ridge Road, Little Rock, AR 72227-1518
</TABLE>
13
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
John J. Stollenwerk (AM, E, F)............................ President and Chief Executive Officer, Allen-Edmonds Shoe Corporation,
201 East Seven Hills Road, P.O. Box 998, Port Washington, WI 53074-0998
Barry L. Williams (HR).................................... President and Chief Executive Officer, C.N. Flagg Power, Inc., Meriden,
CT (construction services for electric power plants) and President,
Williams Pacific Ventures, Inc., 100 First Street, Suite 2350, San
Francisco, CA 94105-2634 (venture capital)
Kathryn D. Wriston (A).................................... Director of various corporations. Address: c/o Shearman & Sterling,
599 Lexington Avenue, Room 1126, New York, NY 10022
</TABLE>
A -- Member, Audit Committee
AM -- Member, Agency and Marketing Committee
E -- Member, Executive Committee
F -- Member, Finance Committee
HR -- Member, Human Resources and Public Policy Committee
OT -- Member, Operations and Technology Committee
SENIOR OFFICERS (OTHER THAN TRUSTEES)
<TABLE>
<CAPTION>
POSITION WITH
NAME NORTHWESTERN MUTUAL LIFE
----------------------------------------------------------------------
<S> <C>
John M. Bremer Executive Vice President, General
Counsel and Secretary
Peter W. Bruce Executive Vice President
Edward J. Zore Executive Vice President
Deborah A. Beck Senior Vice President
William H. Beckley Senior Vice President
Mark G. Doll Senior Vice President
Richard L. Hall Senior Vice President
William C. Koenig Senior Vice President and
Chief Actuary
Donald L. Mellish Senior Vice President
Mason G. Ross Senior Vice President
Leonard F. Stecklein Senior Vice President
Frederic H. Sweet Senior Vice President
Dennis Tamcsin Senior Vice President
Walter J. Wojcik Senior Vice President
Gary E. Long Vice President and Controller
</TABLE>
REGULATION
Northwestern Mutual Life is subject to the laws of Wisconsin governing insurance
companies and to regulation by the Wisconsin Commissioner of Insurance. An
annual statement in a prescribed form is filed with the Department of Insurance
on or before March 1 in each year covering operations for the preceding year and
including financial statements. Regulation by the Wisconsin Insurance Department
includes periodic examination to determine solvency and compliance with
insurance laws. Northwestern Mutual Life is also subject to the insurance laws
and regulations of the other jurisdictions in which it is licensed to operate.
LEGAL PROCEEDINGS
Northwestern Mutual Life is engaged in litigation of various kinds which in its
judgment is not of material importance in relation to its total assets. There
are no legal proceedings pending to which the Account is a party.
REGISTRATION STATEMENT
A registration statement has been filed with the Securities and Exchange
Commission, Washington, D.C. by Northwestern Mutual Life under the Securities
Act of 1933, as amended, with respect to the Policies. This prospectus does not
contain all the information set forth in the registration statement. A copy of
the omitted material is available from the main office of the SEC in
14
<PAGE>
Washington, D.C. upon payment of the prescribed fee. Further information about
the Policies is also available from the Home Office of Northwestern Mutual Life.
The address and telephone number are on the cover of this prospectus.
EXPERTS
The financial statements of Northwestern Mutual Life as of December 31, 1997 and
1996 and for each of the three years in the period ended December 31, 1997 and
of the Account as of December 31, 1997 and for each of the two years in the
period ended December 31, 1997 included in this prospectus have been so included
in reliance on the reports of Price Waterhouse LLP, independent accountants,
given on the authority of said firm as experts in auditing and accounting.
Actuarial matters included in this prospectus have been examined by William C.
Koenig, F.S.A., Senior Vice President and Chief Actuary of Northwestern Mutual
Life. His opinion is filed as an exhibit to the registration statement.
15
<PAGE>
Pages 16 through 22 are reserved for
DECEMBER 31, 1997 FINANCIAL STATEMENTS
for
NORTHWESTERN MUTUAL VARIABLE LIFE ACCOUNT
16
<PAGE>
NORTHWESTERN MUTUAL VARIABLE LIFE ACCOUNT
17
<PAGE>
NORTHWESTERN MUTUAL VARIABLE LIFE ACCOUNT
18
<PAGE>
NORTHWESTERN MUTUAL VARIABLE LIFE ACCOUNT
19
<PAGE>
NORTHWESTERN MUTUAL VARIABLE LIFE ACCOUNT
20
<PAGE>
NORTHWESTERN MUTUAL VARIABLE LIFE ACCOUNT
21
<PAGE>
NORTHWESTERN MUTUAL VARIABLE LIFE ACCOUNT
22
<PAGE>
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY AND SUBSIDIARY
CONSOLIDATED FINANCIAL STATEMENTS
The following financial statements of Northwestern Mutual should be considered
only as bearing upon the ability of Northwestern Mutual Life to meet its
obligations under the Policies.
Pages 23 - 36 are reserved for
the December 31, 1997 Financial Statements
for The Northwestern Mutual Life Insurance Company
The accompanying notes are an integral part of the financial statements
23
<PAGE>
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
The accompanying notes are an integral part of the financial statements
24
<PAGE>
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
The accompanying notes are an integral part of the financial statements
25
<PAGE>
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
The accompanying notes are an integral part of the financial statements
26
<PAGE>
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
The accompanying notes are an integral part of the financial statements
27
<PAGE>
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
28
<PAGE>
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
29
<PAGE>
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
30
<PAGE>
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
31
<PAGE>
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
32
<PAGE>
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
33
<PAGE>
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
34
<PAGE>
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
35
<PAGE>
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
36
<PAGE>
APPENDIX A
ILLUSTRATIONS OF DEATH BENEFITS, POLICY VALUES CASH VALUES AND ACCUMULATED
PREMIUMS. The tables on the following pages illustrate how the death benefit,
Policy Value and cash value for a Policy would vary over time based on
hypothetical investment results. The tables assume gross investment return rates
of 0%, 6% and 12% on assets of the Account. The Policies illustrated are for a
male and female, both select risks, age 55, with a Specified Amount of
$1,000,000 and annual premium of $20,000. The first four illustrations, on
pages 38-41, are for death benefit Option A, based on both current charges and
Guaranteed Charges, using 1) the Guideline Premium/Cash Value Corridor Test, and
2) the Cash Value Accumulation Test for the definition of life insurance. The
next four illustrations are for Policies with death benefit Option B.
The death benefits and cash values would be different from those shown if the
gross investment return rate averaged 0%, 6% or 12%, but fluctuated over and
under the average rate at various points in time. The values would also be
different, depending on the Account divisions selected by the owner of the
Policy, if the return rate for the nine Fund Portfolios averaged 0%, 6% or 12%,
but the rates for each individual Portfolio varied over and under the average.
The amounts shown as the death benefits, Policy Values and cash values reflect
the deductions from premiums and deductions from Policy Value. The amounts
shown as the cash values reflect surrender charges. The amounts shown also
reflect the average of the investment advisory fees and other Fund expenses
applicable to each of the nine Portfolios of the Fund during 1997 at the annual
rate of .45% of the Fund's net assets. See "The Fund", p. 3. Thus the 0%, 6%
and 12% gross hypothetical return rates on the Fund's assets are equivalent to
the net rates of -.45%, 5.55% and 11.55% on the assets of the Account.
The second column of each table shows the amount which would accumulate if an
amount equal to the annual premium were invested to earn interest, after taxes,
at a 5% interest rate compounded annually.
The death benefits and corresponding Policy Values and cash values shown on
pages 38, 40, 42 and 44 illustrate benefits which would be paid if investment
returns of 0%, 6% and 12% are realized, and if mortality and expense experience
in the future is as currently experienced. HOWEVER, CURRENT MONTHLY COST OF
INSURANCE AND EXPENSE CHARGES MAY CHANGE SUBJECT TO THE STATED MAXIMUM CHARGES.
A comparable illustration based on the issue age, sex and risk classification of
the proposed insured persons and proposed Specified Amount, death benefit option
and premium is available upon request.
37
<PAGE>
FLEXIBLE PREMIUM VARIABLE JOINT LIFE INSURANCE POLICY
SPECIFIED AMOUNT: $1,000,000 DEATH BENEFIT OPTION: A
MALE SELECT CLASS ISSUE AGE 55 FEMALE SELECT CLASS ISSUE AGE 55
ANNUAL PREMIUM: $20,000 GUIDELINE PREMIUM / CASH VALUE CORRIDOR TEST
CURRENT CHARGES
<TABLE>
<CAPTION>
DEATH BENEFIT
-----------------------------------------------------------
ASSUMING HYPOTHETICAL GROSS ANNUAL INVESTMENT RETURN OF
END OF PREMIUM ACCUMULATED -----------------------------------------------------------
POLICY YEAR AT 5% INTEREST PER YEAR 0% 6% 12%
- ----------- ----------------------- --------- --------- ---------
<S> <C> <C> <C> <C>
1 21,000 1,000,000 1,000,000 1,000,000
2 43,050 1,000,000 1,000,000 1,000,000
3 66,203 1,000,000 1,000,000 1,000,000
4 90,513 1,000,000 1,000,000 1,000,000
5 116,038 1,000,000 1,000,000 1,000,000
6 142,840 1,000,000 1,000,000 1,000,000
7 170,982 1,000,000 1,000,000 1,000,000
8 200,531 1,000,000 1,000,000 1,000,000
9 231,558 1,000,000 1,000,000 1,000,000
10 264,136 1,000,000 1,000,000 1,000,000
15 453,150 1,000,000 1,000,000 1,000,000
20 694,385 1,000,000 1,000,000 1,262,624
25 1,002,269 1,000,000 1,000,000 2,222,544
30 1,395,216 1,000,000 1,223,959 3,857,463
35 1,896,726 1,000,000 1,648,625 6,515,796
</TABLE>
<TABLE>
<CAPTION>
POLICY VALUE CASH VALUE
------------------------------------------------------- -------------------------------------------------------
ASSUMING HYPOTHETICAL GROSS ANNUAL INVESTMENT RETURN OF ASSUMING HYPOTHETICAL GROSS ANNUAL INVESTMENT RETURN OF
END OF ------------------------------------------------------- -------------------------------------------------------
POLICY YEAR 0% 6% 12% 0% 6% 12%
- ----------- ---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
1 15,552 16,555 17,559 6,263 7,266 8,270
2 30,961 33,946 37,054 22,704 25,690 28,798
3 46,227 52,216 58,699 39,002 44,991 51,474
4 61,348 71,405 82,727 55,156 65,212 76,534
5 76,322 91,556 109,398 71,162 86,396 104,237
6 91,144 112,712 138,997 87,015 108,584 134,869
7 105,806 134,916 171,843 102,710 131,820 168,747
8 120,303 158,213 208,285 118,238 156,149 206,221
9 134,625 182,651 248,716 133,592 181,619 247,684
10 148,766 208,281 293,573 148,766 208,281 293,573
15 230,905 373,312 623,433 230,905 373,312 623,433
20 302,138 579,459 1,180,022 302,138 579,459 1,180,022
25 343,900 834,546 2,116,709 343,900 834,546 2,116,709
30 312,746 1,165,676 3,673,775 312,746 1,165,676 3,673,775
35 75,609 1,570,119 6,205,520 75,609 1,570,119 6,205,520
</TABLE>
ALL PREMIUM PAYMENTS ARE ILLUSTRATED AS IF MADE AT THE BEGINNING OF THE POLICY
YEAR. ASSUMES NO POLICY LOAN OR WITHDRAWAL HAS BEEN MADE.
IT IS EMPHASIZED THAT THE HYPOTHETICAL INVESTMENT RESULTS ARE ILLUSTRATIVE ONLY
AND SHOULD NOT BE DEEMED A REPRESENTATION OF PAST OR FUTURE INVESTMENT RESULTS.
ACTUAL INVESTMENT RESULTS MAY BE MORE OR LESS THAN THOSE SHOWN AND WILL DEPEND
UPON A NUMBER OF FACTORS, INCLUDING THE INVESTMENT ALLOCATIONS MADE BY AN OWNER
TO THE DIVISIONS OF THE VARIABLE ACCOUNT AND THE DIFFERENT RATES OF RETURN OF
THE VARIABLE ACCOUNT.
THE DEATH BENEFIT, POLICY VALUE AND CASH VALUE FOR A POLICY WOULD BE DIFFERENT
FROM THOSE SHOWN IF THE ACTUAL INVESTMENT RATES OF RETURN AVERAGED 0%, 6% AND
12% OVER A PERIOD OF YEARS, BUT FLUCTUATED ABOVE OR BELOW THOSE AVERAGES FOR
INDIVIDUAL POLICY YEARS. THEY WOULD ALSO BE DIFFERENT IF PREMIUMS WERE PAID IN
DIFFERENT AMOUNTS OR FREQUENCIES THAN SHOWN. NO REPRESENTATIONS CAN BE MADE
THAT THESE HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR
SUSTAINED OVER A PERIOD OF TIME.
38
<PAGE>
FLEXIBLE PREMIUM VARIABLE JOINT LIFE INSURANCE POLICY
SPECIFIED AMOUNT: $1,000,000 DEATH BENEFIT OPTION: A
MALE SELECT CLASS ISSUE AGE 55 FEMALE SELECT CLASS ISSUE AGE 55
ANNUAL PREMIUM: $20,000 GUIDELINE PREMIUM / CASH VALUE CORRIDOR TEST
GUARANTEED CHARGES
<TABLE>
<CAPTION>
DEATH BENEFIT
-----------------------------------------------------------
ASSUMING HYPOTHETICAL GROSS ANNUAL INVESTMENT RETURN OF
END OF PREMIUM ACCUMULATED -----------------------------------------------------------
POLICY YEAR AT 5% INTEREST PER YEAR 0% 6% 12%
- ----------- ----------------------- --------- --------- ---------
<S> <C> <C> <C> <C>
1 21,000 1,000,000 1,000,000 1,000,000
2 43,050 1,000,000 1,000,000 1,000,000
3 66,203 1,000,000 1,000,000 1,000,000
4 90,513 1,000,000 1,000,000 1,000,000
5 116,038 1,000,000 1,000,000 1,000,000
6 142,840 1,000,000 1,000,000 1,000,000
7 170,982 1,000,000 1,000,000 1,000,000
8 200,531 1,000,000 1,000,000 1,000,000
9 231,558 1,000,000 1,000,000 1,000,000
10 264,136 1,000,000 1,000,000 1,000,000
15 453,150 1,000,000 1,000,000 1,000,000
20 694,385 1,000,000 1,000,000 1,110,443
25 1,002,269 1,000,000 1,000,000 1,917,451
30 1,395,216 0* 1,000,000 3,241,786
35 1,896,726 0* 1,027,940 5,300,247
</TABLE>
<TABLE>
<CAPTION>
POLICY VALUE CASH VALUE
------------------------------------------------------- -------------------------------------------------------
ASSUMING HYPOTHETICAL GROSS ANNUAL INVESTMENT RETURN OF ASSUMING HYPOTHETICAL GROSS ANNUAL INVESTMENT RETURN OF
END OF ------------------------------------------------------- -------------------------------------------------------
POLICY YEAR 0% 6% 12% 0% 6% 12%
- ----------- ---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
1 15,402 16,398 17,395 6,113 7,109 8,106
2 30,491 33,441 36,512 22,234 25,184 28,256
3 45,250 51,138 57,513 38,025 43,914 50,289
4 59,661 69,498 80,576 53,469 63,306 74,384
5 73,703 88,527 105,895 68,543 83,367 100,735
6 87,348 108,224 133,682 83,220 104,096 129,554
7 100,561 128,585 164,168 97,465 125,489 161,071
8 113,293 149,591 197,598 111,229 147,526 195,534
9 125,478 171,209 234,239 124,446 170,177 233,207
10 137,038 193,396 274,383 137,038 193,396 274,383
15 197,245 328,723 562,052 197,245 328,723 562,052
20 222,822 475,172 1,037,797 222,822 475,172 1,037,797
25 169,606 621,632 1,826,144 169,606 621,632 1,826,144
30 0* 771,001 3,087,416 0* 771,001 3,087,416
35 0* 978,991 5,047,855 0* 978,991 5,047,855
</TABLE>
*Additional payment will be required to prevent policy termination.
ALL PREMIUM PAYMENTS ARE ILLUSTRATED AS IF MADE AT THE BEGINNING OF THE POLICY
YEAR. ASSUMES NO POLICY LOAN OR WITHDRAWAL HAS BEEN MADE.
IT IS EMPHASIZED THAT THE HYPOTHETICAL INVESTMENT RESULTS ARE ILLUSTRATIVE ONLY
AND SHOULD NOT BE DEEMED A REPRESENTATION OF PAST OR FUTURE INVESTMENT RESULTS.
ACTUAL INVESTMENT RESULTS MAY BE MORE OR LESS THAN THOSE SHOWN AND WILL DEPEND
UPON A NUMBER OF FACTORS, INCLUDING THE INVESTMENT ALLOCATIONS MADE BY AN OWNER
TO THE DIVISIONS OF THE VARIABLE ACCOUNT AND THE DIFFERENT RATES OF RETURN OF
THE VARIABLE ACCOUNT.
THE DEATH BENEFIT, POLICY VALUE AND CASH VALUE FOR A POLICY WOULD BE DIFFERENT
FROM THOSE SHOWN IF THE ACTUAL INVESTMENT RATES OF RETURN AVERAGED 0%, 6% AND
12% OVER A PERIOD OF YEARS, BUT FLUCTUATED ABOVE OR BELOW THOSE AVERAGES FOR
INDIVIDUAL POLICY YEARS. THEY WOULD ALSO BE DIFFERENT IF PREMIUMS WERE PAID IN
DIFFERENT AMOUNTS OR FREQUENCIES THAN SHOWN. NO REPRESENTATIONS CAN BE MADE
THAT THESE HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR
SUSTAINED OVER A PERIOD OF TIME.
39
<PAGE>
FLEXIBLE PREMIUM VARIABLE JOINT LIFE INSURANCE POLICY
SPECIFIED AMOUNT: $1,000,000 DEATH BENEFIT OPTION: A
MALE SELECT CLASS ISSUE AGE 55 FEMALE SELECT CLASS ISSUE AGE 55
ANNUAL PREMIUM: $20,000 CASH VALUE ACCUMULATION TEST
CURRENT CHARGES
<TABLE>
<CAPTION>
DEATH BENEFIT
-----------------------------------------------------------
ASSUMING HYPOTHETICAL GROSS ANNUAL INVESTMENT RETURN OF
END OF PREMIUM ACCUMULATED -----------------------------------------------------------
POLICY YEAR AT 5% INTEREST PER YEAR 0% 6% 12%
- ----------- ----------------------- --------- --------- ---------
<S> <C> <C> <C> <C>
1 21,000 1,000,000 1,000,000 1,000,000
2 43,050 1,000,000 1,000,000 1,000,000
3 66,203 1,000,000 1,000,000 1,000,000
4 90,513 1,000,000 1,000,000 1,000,000
5 116,038 1,000,000 1,000,000 1,000,000
6 142,840 1,000,000 1,000,000 1,000,000
7 170,982 1,000,000 1,000,000 1,000,000
8 200,531 1,000,000 1,000,000 1,000,000
9 231,558 1,000,000 1,000,000 1,000,000
10 264,136 1,000,000 1,000,000 1,000,000
15 453,150 1,000,000 1,000,000 1,152,891
20 694,385 1,000,000 1,000,000 1,852,322
25 1,002,269 1,000,000 1,152,710 2,856,370
30 1,395,216 1,000,000 1,403,598 4,310,533
35 1,896,726 1,000,000 1,666,348 6,400,957
</TABLE>
<TABLE>
<CAPTION>
POLICY VALUE CASH VALUE
------------------------------------------------------- -------------------------------------------------------
ASSUMING HYPOTHETICAL GROSS ANNUAL INVESTMENT RETURN OF ASSUMING HYPOTHETICAL GROSS ANNUAL INVESTMENT RETURN OF
END OF ------------------------------------------------------- -------------------------------------------------------
POLICY YEAR 0% 6% 12% 0% 6% 12%
- ----------- ---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
1 15,552 16,555 17,559 6,263 7,266 8,270
2 30,961 33,946 37,054 22,704 25,690 28,798
3 46,227 52,216 58,699 39,002 44,991 51,474
4 61,348 71,405 82,727 55,156 65,212 76,534
5 76,322 91,556 109,398 71,162 86,396 104,237
6 91,144 112,712 138,997 87,015 108,584 134,869
7 105,806 134,916 171,843 102,710 131,820 168,747
8 120,303 158,213 208,285 118,238 156,149 206,221
9 134,625 182,651 248,716 133,592 181,619 247,684
10 148,766 208,281 293,573 148,766 208,281 293,573
15 230,905 373,312 623,321 230,905 373,312 623,321
20 302,138 579,459 1,171,954 302,138 579,459 1,171,954
25 343,900 830,613 2,058,227 343,900 830,613 2,058,227
30 312,746 1,118,193 3,434,039 312,746 1,118,193 3,434,039
35 75,609 1,424,569 5,472,210 75,609 1,424,569 5,472,210
</TABLE>
ALL PREMIUM PAYMENTS ARE ILLUSTRATED AS IF MADE AT THE BEGINNING OF THE POLICY
YEAR. ASSUMES NO POLICY LOAN OR WITHDRAWAL HAS BEEN MADE.
IT IS EMPHASIZED THAT THE HYPOTHETICAL INVESTMENT RESULTS ARE ILLUSTRATIVE ONLY
AND SHOULD NOT BE DEEMED A REPRESENTATION OF PAST OR FUTURE INVESTMENT RESULTS.
ACTUAL INVESTMENT RESULTS MAY BE MORE OR LESS THAN THOSE SHOWN AND WILL DEPEND
UPON A NUMBER OF FACTORS, INCLUDING THE INVESTMENT ALLOCATIONS MADE BY AN OWNER
TO THE DIVISIONS OF THE VARIABLE ACCOUNT AND THE DIFFERENT RATES OF RETURN OF
THE VARIABLE ACCOUNT.
THE DEATH BENEFIT, POLICY VALUE AND CASH VALUE FOR A POLICY WOULD BE DIFFERENT
FROM THOSE SHOWN IF THE ACTUAL INVESTMENT RATES OF RETURN AVERAGED 0%, 6% AND
12% OVER A PERIOD OF YEARS, BUT FLUCTUATED ABOVE OR BELOW THOSE AVERAGES FOR
INDIVIDUAL POLICY YEARS. THEY WOULD ALSO BE DIFFERENT IF PREMIUMS WERE PAID IN
DIFFERENT AMOUNTS OR FREQUENCIES THAN SHOWN. NO REPRESENTATIONS CAN BE MADE
THAT THESE HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR
SUSTAINED OVER A PERIOD OF TIME.
40
<PAGE>
FLEXIBLE PREMIUM VARIABLE JOINT LIFE INSURANCE POLICY
SPECIFIED AMOUNT: $1,000,000 DEATH BENEFIT OPTION: A
MALE SELECT CLASS ISSUE AGE 55 FEMALE SELECT CLASS ISSUE AGE 55
ANNUAL PREMIUM: $20,000 CASH VALUE ACCUMULATION TEST
GUARANTEED CHARGES
<TABLE>
<CAPTION>
DEATH BENEFIT
-----------------------------------------------------------
ASSUMING HYPOTHETICAL GROSS ANNUAL INVESTMENT RETURN OF
END OF PREMIUM ACCUMULATED -----------------------------------------------------------
POLICY YEAR AT 5% INTEREST PER YEAR 0% 6% 12%
- ----------- ----------------------- --------- --------- ---------
<S> <C> <C> <C> <C>
1 21,000 1,000,000 1,000,000 1,000,000
2 43,050 1,000,000 1,000,000 1,000,000
3 66,203 1,000,000 1,000,000 1,000,000
4 90,513 1,000,000 1,000,000 1,000,000
5 116,038 1,000,000 1,000,000 1,000,000
6 142,840 1,000,000 1,000,000 1,000,000
7 170,982 1,000,000 1,000,000 1,000,000
8 200,531 1,000,000 1,000,000 1,000,000
9 231,558 1,000,000 1,000,000 1,000,000
10 264,136 1,000,000 1,000,000 1,000,000
15 453,150 1,000,000 1,000,000 1,039,459
20 694,385 1,000,000 1,000,000 1,597,137
25 1,002,269 1,000,000 1,000,000 2,315,595
30 1,395,216 0* 1,000,000 3,255,803
35 1,896,726 0* 1,097,414 4,501,774
</TABLE>
<TABLE>
<CAPTION>
POLICY VALUE CASH VALUE
------------------------------------------------------- -------------------------------------------------------
ASSUMING HYPOTHETICAL GROSS ANNUAL INVESTMENT RETURN OF ASSUMING HYPOTHETICAL GROSS ANNUAL INVESTMENT RETURN OF
END OF ------------------------------------------------------- -------------------------------------------------------
POLICY YEAR 0% 6% 12% 0% 6% 12%
- ----------- ---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
1 15,402 16,398 17,395 6,113 7,109 8,106
2 30,491 33,441 36,512 22,234 25,184 28,256
3 45,250 51,138 57,513 38,025 43,914 50,289
4 59,661 69,498 80,576 53,469 63,306 74,384
5 73,703 88,527 105,895 68,543 83,367 100,735
6 87,348 108,224 133,682 83,220 104,096 129,554
7 100,561 128,585 164,168 97,465 125,489 161,071
8 113,293 149,591 197,598 111,229 147,526 195,534
9 125,478 171,209 234,239 124,446 170,177 233,207
10 137,038 193,396 274,383 137,038 193,396 274,383
15 197,245 328,723 561,993 197,245 328,723 561,993
20 222,822 475,172 1,010,500 222,822 475,172 1,010,500
25 169,606 621,632 1,668,558 169,606 621,632 1,668,558
30 0* 771,001 2,593,775 0* 771,001 2,593,775
35 0* 938,185 3,848,589 0* 938,185 3,848,589
</TABLE>
*Additional payment will be required to prevent policy termination.
ALL PREMIUM PAYMENTS ARE ILLUSTRATED AS IF MADE AT THE BEGINNING OF THE POLICY
YEAR. ASSUMES NO POLICY LOAN OR WITHDRAWAL HAS BEEN MADE.
IT IS EMPHASIZED THAT THE HYPOTHETICAL INVESTMENT RESULTS ARE ILLUSTRATIVE ONLY
AND SHOULD NOT BE DEEMED A REPRESENTATION OF PAST OR FUTURE INVESTMENT RESULTS.
ACTUAL INVESTMENT RESULTS MAY BE MORE OR LESS THAN THOSE SHOWN AND WILL DEPEND
UPON A NUMBER OF FACTORS, INCLUDING THE INVESTMENT ALLOCATIONS MADE BY AN OWNER
TO THE DIVISIONS OF THE VARIABLE ACCOUNT AND THE DIFFERENT RATES OF RETURN OF
THE VARIABLE ACCOUNT.
THE DEATH BENEFIT, POLICY VALUE AND CASH VALUE FOR A POLICY WOULD BE DIFFERENT
FROM THOSE SHOWN IF THE ACTUAL INVESTMENT RATES OF RETURN AVERAGED 0%, 6% AND
12% OVER A PERIOD OF YEARS, BUT FLUCTUATED ABOVE OR BELOW THOSE AVERAGES FOR
INDIVIDUAL POLICY YEARS. THEY WOULD ALSO BE DIFFERENT IF PREMIUMS WERE PAID IN
DIFFERENT AMOUNTS OR FREQUENCIES THAN SHOWN. NO REPRESENTATIONS CAN BE MADE
THAT THESE HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR
SUSTAINED OVER A PERIOD OF TIME.
41
<PAGE>
FLEXIBLE PREMIUM VARIABLE JOINT LIFE INSURANCE POLICY
SPECIFIED AMOUNT: $1,000,000 DEATH BENEFIT OPTION: B
MALE SELECT CLASS ISSUE AGE 55 FEMALE SELECT CLASS ISSUE AGE 55
ANNUAL PREMIUM: $20,000 GUIDELINE PREMIUM / CASH VALUE CORRIDOR TEST
CURRENT CHARGES
<TABLE>
<CAPTION>
DEATH BENEFIT
-------------------------------------------------------
ASSUMING HYPOTHETICAL GROSS ANNUAL INVESTMENT RETURN OF
END OF PREMIUM ACCUMULATED -------------------------------------------------------
POLICY YEAR AT 5% INTEREST PER YEAR 0% 6% 12%
----------- ----------------------- --------- --------- ---------
<S> <C> <C> <C> <C>
1 21,000 1,015,552 1,016,555 1,017,559
2 43,050 1,030,961 1,033,946 1,037,054
3 66,203 1,046,226 1,052,215 1,058,698
4 90,513 1,061,347 1,071,403 1,082,724
5 116,038 1,076,318 1,091,551 1,109,391
6 142,840 1,091,135 1,112,701 1,138,983
7 170,982 1,105,789 1,134,893 1,171,813
8 200,531 1,120,270 1,158,169 1,208,226
9 231,558 1,134,568 1,182,572 1,248,606
10 264,136 1,148,674 1,208,148 1,293,379
15 453,150 1,230,148 1,372,018 1,621,182
20 694,385 1,297,477 1,570,037 2,161,396
25 1,002,269 1,320,707 1,777,053 3,020,880
30 1,395,216 1,233,742 1,917,913 4,330,938
35 1,896,726 0* 1,824,873 6,230,371
</TABLE>
<TABLE>
<CAPTION>
POLICY VALUE CASH VALUE
-------------------------------------- --------------------------------------
ASSUMING HYPOTHETICAL GROSS ASSUMING HYPOTHETICAL GROSS
ANNUAL INVESTMENT RETURN OF ANNUAL INVESTMENT RETURN OF
END OF -------------------------------------- --------------------------------------
POLICY YEAR 0% 6% 12% 0% 6% 12%
----------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
1 15,552 16,555 17,559 6,263 7,266 8,270
2 30,961 33,946 37,054 22,704 25,689 28,797
3 46,226 52,215 58,698 39,002 44,990 51,473
4 61,347 71,403 82,724 55,154 65,210 76,532
5 76,318 91,551 109,391 71,158 86,391 104,231
6 91,135 112,701 138,983 87,007 108,572 134,855
7 105,789 134,893 171,813 102,692 131,797 168,717
8 120,270 158,169 208,226 118,206 156,105 206,162
9 134,568 182,572 248,606 133,536 181,540 247,574
10 148,674 208,148 293,379 148,674 208,148 293,379
15 230,148 372,018 621,182 230,148 372,018 621,182
20 297,477 570,037 1,161,396 297,477 570,037 1,161,396
25 320,707 777,053 2,020,880 320,707 777,053 2,020,880
30 233,742 917,913 3,330,938 233,742 917,913 3,330,938
35 0* 824,873 5,230,371 0* 824,873 5,230,371
</TABLE>
*Additional payment will be required to prevent policy termination.
ALL PREMIUM PAYMENTS ARE ILLUSTRATED AS IF MADE AT THE BEGINNING OF THE POLICY
YEAR. ASSUMES NO POLICY LOAN OR WITHDRAWAL HAS BEEN MADE.
IT IS EMPHASIZED THAT THE HYPOTHETICAL INVESTMENT RESULTS ARE ILLUSTRATIVE ONLY
AND SHOULD NOT BE DEEMED A REPRESENTATION OF PAST OR FUTURE INVESTMENT RESULTS.
ACTUAL INVESTMENT RESULTS MAY BE MORE OR LESS THAN THOSE SHOWN AND WILL DEPEND
UPON A NUMBER OF FACTORS, INCLUDING THE INVESTMENT ALLOCATIONS MADE BY AN OWNER
TO THE DIVISIONS OF THE VARIABLE ACCOUNT AND THE DIFFERENT RATES OF RETURN OF
THE VARIABLE ACCOUNT.
THE DEATH BENEFIT, POLICY VALUE AND CASH VALUE FOR A POLICY WOULD BE DIFFERENT
FROM THOSE SHOWN IF THE ACTUAL INVESTMENT RATES OF RETURN AVERAGED 0%, 6% AND
12% OVER A PERIOD OF YEARS, BUT FLUCTUATED ABOVE OR BELOW THOSE AVERAGES FOR
INDIVIDUAL POLICY YEARS. THEY WOULD ALSO BE DIFFERENT IF PREMIUMS WERE PAID IN
DIFFERENT AMOUNTS OR FREQUENCIES THAN SHOWN. NO REPRESENTATIONS CAN BE MADE
THAT THESE HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR
SUSTAINED OVER A PERIOD OF TIME.
42
<PAGE>
FLEXIBLE PREMIUM VARIABLE JOINT LIFE INSURANCE POLICY
SPECIFIED AMOUNT: $1,000,000 DEATH BENEFIT OPTION: B
MALE SELECT CLASS ISSUE AGE 55 FEMALE SELECT CLASS ISSUE AGE 55
ANNUAL PREMIUM: $20,000 GUIDELINE PREMIUM / CASH VALUE CORRIDOR TEST
GUARANTEED CHARGES
<TABLE>
<CAPTION>
DEATH BENEFIT
-------------------------------------------------------
ASSUMING HYPOTHETICAL GROSS ANNUAL INVESTMENT RETURN OF
END OF PREMIUM ACCUMULATED -------------------------------------------------------
POLICY YEAR AT 5% INTEREST PER YEAR 0% 6% 12%
----------- ----------------------- --------- --------- ---------
<S> <C> <C> <C> <C>
1 21,000 1,015,401 1,016,397 1,017,394
2 43,050 1,030,485 1,033,435 1,036,505
3 66,203 1,045,230 1,051,116 1,057,488
4 90,513 1,059,613 1,069,442 1,080,510
5 116,038 1,073,606 1,088,409 1,105,751
6 142,840 1,087,172 1,108,001 1,133,401
7 170,982 1,100,265 1,128,195 1,163,658
8 200,531 1,112,821 1,148,947 1,196,723
9 231,558 1,124,755 1,170,185 1,232,793
10 264,136 1,135,963 1,191,818 1,272,068
15 453,150 1,191,561 1,318,730 1,544,250
20 694,385 1,202,441 1,430,901 1,940,462
25 1,002,269 1,115,794 1,460,735 2,468,355
30 1,395,216 0* 1,284,896 3,096,108
35 1,896,726 0* 0* 3,703,056
</TABLE>
<TABLE>
<CAPTION>
POLICY VALUE CASH VALUE
-------------------------------------- --------------------------------------
ASSUMING HYPOTHETICAL GROSS ASSUMING HYPOTHETICAL GROSS
ANNUAL INVESTMENT RETURN OF ANNUAL INVESTMENT RETURN OF
END OF -------------------------------------- --------------------------------------
POLICY YEAR 0% 6% 12% 0% 6% 12%
----------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
1 15,401 16,397 17,394 6,113 7,108 8,105
2 30,485 33,435 36,505 22,228 25,178 28,249
3 45,230 51,116 57,488 38,006 43,891 50,264
4 59,613 69,442 80,510 53,421 63,250 74,318
5 73,606 88,409 105,751 68,446 83,248 100,591
6 87,172 108,001 133,401 83,044 103,873 129,273
7 100,265 128,195 163,658 97,169 125,099 160,562
8 112,821 148,947 196,723 110,757 146,882 194,658
9 124,755 170,185 232,793 123,723 169,153 231,761
10 135,963 191,818 272,068 135,963 191,818 272,068
15 191,561 318,730 544,250 191,561 318,730 544,250
20 202,441 430,901 940,462 202,441 430,901 940,462
25 115,794 460,735 1,468,355 115,794 460,735 1,468,355
30 0* 284,896 2,096,108 0* 284,896 2,096,108
35 0* 0* 2,703,056 0* 0* 2,703,056
</TABLE>
*Additional payment will be required to prevent policy termination.
ALL PREMIUM PAYMENTS ARE ILLUSTRATED AS IF MADE AT THE BEGINNING OF THE POLICY
YEAR. ASSUMES NO POLICY LOAN OR WITHDRAWAL HAS BEEN MADE.
IT IS EMPHASIZED THAT THE HYPOTHETICAL INVESTMENT RESULTS ARE ILLUSTRATIVE ONLY
AND SHOULD NOT BE DEEMED A REPRESENTATION OF PAST OR FUTURE INVESTMENT RESULTS.
ACTUAL INVESTMENT RESULTS MAY BE MORE OR LESS THAN THOSE SHOWN AND WILL DEPEND
UPON A NUMBER OF FACTORS, INCLUDING THE INVESTMENT ALLOCATIONS MADE BY AN OWNER
TO THE DIVISIONS OF THE VARIABLE ACCOUNT AND THE DIFFERENT RATES OF RETURN OF
THE VARIABLE ACCOUNT.
THE DEATH BENEFIT, POLICY VALUE AND CASH VALUE FOR A POLICY WOULD BE DIFFERENT
FROM THOSE SHOWN IF THE ACTUAL INVESTMENT RATES OF RETURN AVERAGED 0%, 6% AND
12% OVER A PERIOD OF YEARS, BUT FLUCTUATED ABOVE OR BELOW THOSE AVERAGES FOR
INDIVIDUAL POLICY YEARS. THEY WOULD ALSO BE DIFFERENT IF PREMIUMS WERE PAID IN
DIFFERENT AMOUNTS OR FREQUENCIES THAN SHOWN. NO REPRESENTATIONS CAN BE MADE
THAT THESE HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR
SUSTAINED OVER A PERIOD OF TIME.
43
<PAGE>
FLEXIBLE PREMIUM VARIABLE JOINT LIFE INSURANCE POLICY
SPECIFIED AMOUNT: $1,000,000 DEATH BENEFIT OPTION: B
MALE SELECT CLASS ISSUE AGE 55 FEMALE SELECT CLASS ISSUE AGE 55
ANNUAL PREMIUM: $20,000 CASH VALUE ACCUMULATION TEST
CURRENT CHARGES
<TABLE>
<CAPTION>
DEATH BENEFIT
-------------------------------------------------------
ASSUMING HYPOTHETICAL GROSS ANNUAL INVESTMENT RETURN OF
END OF PREMIUM ACCUMULATED -------------------------------------------------------
POLICY YEAR AT 5% INTEREST PER YEAR 0% 6% 12%
----------- ----------------------- --------- --------- ---------
<S> <C> <C> <C> <C>
1 21,000 1,015,552 1,016,555 1,017,559
2 43,050 1,030,961 1,033,946 1,037,054
3 66,203 1,046,226 1,052,215 1,058,698
4 90,513 1,061,347 1,071,403 1,082,724
5 116,038 1,076,318 1,091,551 1,109,391
6 142,840 1,091,135 1,112,701 1,138,983
7 170,982 1,105,789 1,134,893 1,171,813
8 200,531 1,120,270 1,158,169 1,208,226
9 231,558 1,134,568 1,182,572 1,248,606
10 264,136 1,148,674 1,208,148 1,293,379
15 453,150 1,230,148 1,372,018 1,621,182
20 694,385 1,297,477 1,570,037 2,161,396
25 1,002,269 1,320,707 1,777,053 3,020,880
30 1,395,216 1,233,742 1,917,913 4,330,938
35 1,896,726 0* 1,824,873 6,230,371
</TABLE>
<TABLE>
<CAPTION>
POLICY VALUE CASH VALUE
-------------------------------------- --------------------------------------
ASSUMING HYPOTHETICAL GROSS ASSUMING HYPOTHETICAL GROSS
ANNUAL INVESTMENT RETURN OF ANNUAL INVESTMENT RETURN OF
END OF -------------------------------------- --------------------------------------
POLICY YEAR 0% 6% 12% 0% 6% 12%
----------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
1 15,552 16,555 17,559 6,263 7,266 8,270
2 30,961 33,946 37,054 22,704 25,689 28,797
3 46,226 52,215 58,698 39,002 44,990 51,473
4 61,347 71,403 82,724 55,154 65,210 76,532
5 76,318 91,551 109,391 71,158 86,391 104,231
6 91,135 112,701 138,983 87,007 108,572 134,855
7 105,789 134,893 171,813 102,692 131,797 168,717
8 120,270 158,169 208,226 118,206 156,105 206,162
9 134,568 182,572 248,606 133,536 181,540 247,574
10 148,674 208,148 293,379 148,674 208,148 293,379
15 230,148 372,018 621,182 230,148 372,018 621,182
20 297,477 570,037 1,161,396 297,477 570,037 1,161,396
25 320,707 777,053 2,020,880 320,707 777,053 2,020,880
30 233,742 917,913 3,330,938 233,742 917,913 3,330,938
35 0* 824,873 5,230,371 0* 824,873 5,230,371
</TABLE>
*Additional payment will be required to prevent policy termination.
ALL PREMIUM PAYMENTS ARE ILLUSTRATED AS IF MADE AT THE BEGINNING OF THE POLICY
YEAR. ASSUMES NO POLICY LOAN OR WITHDRAWAL HAS BEEN MADE.
IT IS EMPHASIZED THAT THE HYPOTHETICAL INVESTMENT RESULTS ARE ILLUSTRATIVE ONLY
AND SHOULD NOT BE DEEMED A REPRESENTATION OF PAST OR FUTURE INVESTMENT RESULTS.
ACTUAL INVESTMENT RESULTS MAY BE MORE OR LESS THAN THOSE SHOWN AND WILL DEPEND
UPON A NUMBER OF FACTORS, INCLUDING THE INVESTMENT ALLOCATIONS MADE BY AN OWNER
TO THE DIVISIONS OF THE VARIABLE ACCOUNT AND THE DIFFERENT RATES OF RETURN OF
THE VARIABLE ACCOUNT.
THE DEATH BENEFIT, POLICY VALUE AND CASH VALUE FOR A POLICY WOULD BE DIFFERENT
FROM THOSE SHOWN IF THE ACTUAL INVESTMENT RATES OF RETURN AVERAGED 0%, 6% AND
12% OVER A PERIOD OF YEARS, BUT FLUCTUATED ABOVE OR BELOW THOSE AVERAGES FOR
INDIVIDUAL POLICY YEARS. THEY WOULD ALSO BE DIFFERENT IF PREMIUMS WERE PAID IN
DIFFERENT AMOUNTS OR FREQUENCIES THAN SHOWN. NO REPRESENTATIONS CAN BE MADE
THAT THESE HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR
SUSTAINED OVER A PERIOD OF TIME.
44
<PAGE>
FLEXIBLE PREMIUM VARIABLE JOINT LIFE INSURANCE POLICY
SPECIFIED AMOUNT: $1,000,000 DEATH BENEFIT OPTION: B
MALE SELECT CLASS ISSUE AGE 55 FEMALE SELECT CLASS ISSUE AGE 55
ANNUAL PREMIUM: $20,000 CASH VALUE ACCUMULATION TEST
GUARANTEED CHARGES
<TABLE>
<CAPTION>
DEATH BENEFIT
-------------------------------------------------------
ASSUMING HYPOTHETICAL GROSS ANNUAL INVESTMENT RETURN OF
END OF PREMIUM ACCUMULATED -------------------------------------------------------
POLICY YEAR AT 5% INTEREST PER YEAR 0% 6% 12%
----------- ----------------------- --------- --------- ---------
<S> <C> <C> <C> <C>
1 21,000 1,015,401 1,016,397 1,017,394
2 43,050 1,030,485 1,033,435 1,036,505
3 66,203 1,045,230 1,051,116 1,057,488
4 90,513 1,059,613 1,069,442 1,080,510
5 116,038 1,073,606 1,088,409 1,105,751
6 142,840 1,087,172 1,108,001 1,133,401
7 170,982 1,100,265 1,128,195 1,163,658
8 200,531 1,112,821 1,148,947 1,196,723
9 231,558 1,124,755 1,170,185 1,232,793
10 264,136 1,135,963 1,191,818 1,272,068
15 453,150 1,191,561 1,318,730 1,544,250
20 694,385 1,202,441 1,430,901 1,940,462
25 1,002,269 1,115,794 1,460,735 2,468,355
30 1,395,216 0* 1,284,896 3,096,108
35 1,896,726 0* 0* 3,703,056
</TABLE>
<TABLE>
<CAPTION>
POLICY VALUE CASH VALUE
-------------------------------------- --------------------------------------
ASSUMING HYPOTHETICAL GROSS ASSUMING HYPOTHETICAL GROSS
ANNUAL INVESTMENT RETURN OF ANNUAL INVESTMENT RETURN OF
END OF -------------------------------------- --------------------------------------
POLICY YEAR 0% 6% 12% 0% 6% 12%
----------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
1 15,401 16,397 17,394 6,113 7,108 8,105
2 30,485 33,435 36,505 22,228 25,178 28,249
3 45,230 51,116 57,488 38,006 43,891 50,264
4 59,613 69,442 80,510 53,421 63,250 74,318
5 73,606 88,409 105,751 68,446 83,248 100,591
6 87,172 108,001 133,401 83,044 103,873 129,273
7 100,265 128,195 163,658 97,169 125,099 160,562
8 112,821 148,947 196,723 110,757 146,882 194,658
9 124,755 170,185 232,793 123,723 169,153 231,761
10 135,963 191,818 272,068 135,963 191,818 272,068
15 191,561 318,730 544,250 191,561 318,730 544,250
20 202,441 430,901 940,462 202,441 430,901 940,462
25 115,794 460,735 1,468,355 115,794 460,735 1,468,355
30 0* 284,896 2,096,108 0* 284,896 2,096,108
35 0* 0* 2,703,056 0* 0* 2,703,056
</TABLE>
*Additional payment will be required to prevent policy termination.
ALL PREMIUM PAYMENTS ARE ILLUSTRATED AS IF MADE AT THE BEGINNING OF THE POLICY
YEAR. ASSUMES NO POLICY LOAN OR WITHDRAWAL HAS BEEN MADE.
IT IS EMPHASIZED THAT THE HYPOTHETICAL INVESTMENT RESULTS ARE ILLUSTRATIVE ONLY
AND SHOULD NOT BE DEEMED A REPRESENTATION OF PAST OR FUTURE INVESTMENT RESULTS.
ACTUAL INVESTMENT RESULTS MAY BE MORE OR LESS THAN THOSE SHOWN AND WILL DEPEND
UPON A NUMBER OF FACTORS, INCLUDING THE INVESTMENT ALLOCATIONS MADE BY AN OWNER
TO THE DIVISIONS OF THE VARIABLE ACCOUNT AND THE DIFFERENT RATES OF RETURN OF
THE VARIABLE ACCOUNT.
THE DEATH BENEFIT, POLICY VALUE AND CASH VALUE FOR A POLICY WOULD BE DIFFERENT
FROM THOSE SHOWN IF THE ACTUAL INVESTMENT RATES OF RETURN AVERAGED 0%, 6% AND
12% OVER A PERIOD OF YEARS, BUT FLUCTUATED ABOVE OR BELOW THOSE AVERAGES FOR
INDIVIDUAL POLICY YEARS. THEY WOULD ALSO BE DIFFERENT IF PREMIUMS WERE PAID IN
DIFFERENT AMOUNTS OR FREQUENCIES THAN SHOWN. NO REPRESENTATIONS CAN BE MADE
THAT THESE HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR
SUSTAINED OVER A PERIOD OF TIME.
45
<PAGE>
APPENDIX B
Mortality and Expense Risk Charge - Specified Amount Component
Table of Annual Charges Per $1,000 of Initial Specified Amount
<TABLE>
<CAPTION>
Issue Annual Issue Annual Issue Annual
Age* Charge Age* Charge Age* Charge
----- ------ ----- ------ ----- ------
<S> <C> <C> <C> <C> <C>
20-25 $0.04 42 0.33 59 0.94
26 0.05 43 0.36 60 0.99
27 0.06 44 0.38 61 1.04
28 0.07 45 0.41 62 1.10
29 0.08 46 0.44 63 1.15
30 0.09 47 0.47 64 1.21
31 0.10 48 0.50 65 1.26
32 0.11 49 0.53 66 1.31
33 0.12 50 0.57 67 1.35
34 0.13 51 0.60 68 1.40
35 0.14 52 0.63 69 1.44
36 0.17 53 0.66 70 1.49
37 0.19 54 0.69 71 1.54
38 0.22 55 0.72 72 1.58
39 0.25 56 0.77 73 1.63
40 0.28 57 0.83 74 1.67
41 0.30 58 0.88 75-85 1.72
</TABLE>
*The issue age used in this calculation equals the younger insured issue age
plus an age adjustment. The age adjustment is based on the age difference
(older issue age minus younger issue age) and this schedule:
<TABLE>
<CAPTION>
Age Age
Difference Adjustment
(years) (years)
------- -------
<S> <C>
0-1 0
2-4 1
5-8 2
9-14 3
15-24 4
25-34 5
35-44 6
45-54 7
55-65 8
</TABLE>
Example: For a Policy at issue ages 65 and 60 and a Specified Amount of
$1,000,000, the age adjustment is 2 and the issue age is 62. The annual charge
per $1000 of Specified Amount is $1.10. The Specified Amount component of the
mortality and expense risk charge will be $1100 annually, or $91.67 monthly, for
this Policy.
Note: In no event will the sum of the Mortality and Expense Risk Charge -
Specified Amount Component Annual Charge and the annualized underwriting and
issue charge exceed $1.90 per $1000 of initial Specified Amount. The
underwriting and issue charge will be reduced to meet this constraint if
necessary.
46
<PAGE>
Northwestern Mutual Life
Northwestern Mutual Variable Joint Life
Northwestern Mutual Variable Life Account
Northwestern Mutual Series Fund, Inc.
P R O S P E C T U S
NORTHWESTERN
MUTUAL LIFE-Registered Trademark-
PO Box 3095
Milwaukee WI 53201-3095
<PAGE>
PART II
UNDERTAKING TO FILE REPORTS
Subject to the terms and conditions of Section 15(d) of the Securities
Exchange Act of 1934, the undersigned registrant hereby undertakes to file with
the Securities and Exchange Commission such supplementary and periodic
information, documents, and reports as may be prescribed by any rule or
regulation of the Commission heretofore or hereafter duly adopted pursuant to
authority conferred in that section.
UNDERTAKING WITH RESPECT TO INDEMNIFICATION
Reference is made to the indemnification provisions contained in Article
VII of the By-laws of the Depositor, The Northwestern Mutual Life Insurance
Company, filed as Exhibit A(6)(b) to the Registration Statement. Insofar as
indemnification for liabilities arising under the Securities Act of 1933 may be
permitted to directors, officers and controlling persons of the registrant
pursuant to the foregoing provisions, or otherwise, the registrant has been
advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
REPRESENTATION WITH RESPECT TO FEES AND CHARGES
The Northwestern Mutual Life Insurance Company hereby represents that the
fees and charges deducted under the contracts registered by this registration
statement, in the aggregate, are reasonable in relation to the services
rendered, the expenses expected to be incurred, and the risks assumed by the
insurance company.
CONTENTS OF REGISTRATION STATEMENT
This registration statement comprises the following papers and documents:
The facing sheet
The cross-reference sheet
The prospectus consisting of 49 pages
The undertaking to file reports
The undertaking with respect to indemnification
The representation with respect to fees and charges
The signatures
Written consents of the following persons:
John M. Bremer, Esq. (to be filed by amendment)
Price Waterhouse LLP (to be filed by amendment)
William C. Koenig, F.S.A. (included in Exhibit C(6))
II-1
<PAGE>
The following exhibits:
1. The following exhibits A(1) through A(10) correspond to those required by
Paragraph A of the instructions as to exhibits in Form N-8B-2:
Exhibit A(1) See Note 1.
Exhibit A(2) Not applicable.
Exhibit A(3) Distributing Contracts:
Exhibit A(3)(a) See Note 2.
Exhibit A(3)(b) Not applicable.
Exhibit A(3)(c) Schedules of sales commissions.
Exhibit A(4) Not applicable.
Exhibit A(5)(a) Variable Life Insurance Policy, RR.VJL, Flexible
Premium Variable Joint Life policy, with application,
including Policy Split Provision (sex-neutral)
Exhibit A(5)(b) Variable Life Insurance Policy, RR.VJL, Flexible
Premium Variable Joint Life policy, with application,
including Policy Split Provision (sex-distinct)
Exhibit A(6)(a) See Note 3.
Exhibit A(6)(b) By-laws of The Northwestern Mutual Life Insurance
Company.
Exhibit A(7) Not applicable.
Exhibit A(8) See Note 1.
Exhibit A(9) Not applicable.
Exhibit A(10) Application form is included in Exhibit A(5)(a) above.
Exhibit A(12) Memorandum describing issuance, transfer and
redemption procedures pursuant to Rule 6e-
3(T)(b)(12)(iii) and method of computing cash
adjustment upon of right to exchange for fixed-benefit
insurance pursuant to Rule 6e-3(T)(b)(13)(v)(B).
Exhibit 2 Opinion and consent of John M. Bremer as to the
legality of the securities being registered. (to be
filed by amendment)
Exhibit C(1) Consent of Price Waterhouse LLP. (to be filed by
amendment)
Exhibit C(6) Opinion and consent of William C. Koenig, F.S.A.
- ------------------
Note 1. The following exhibits were filed in electronic format with the
Registration Statement on Form S-6 for Northwestern Mutual
Variable Life Account, File No. 333-36865, CIK 0000742277, dated
October 1, 1997, and are incorporated herein by reference:
Exhibit A(1) Resolution of Board of Trustees of The Northwestern
Mutual Life Insurance Company establishing the
Account.
Exhibit A(8) Agreement among the Account and its Co-Depositors.
II-2
<PAGE>
Note 2. The following exhibit was filed in electronic format with the
Registration Statement on Form N-4 for NML Variable Annuity
Account A, File No. 333-22455, CIK 0000790162, dated February 27,
1997, and is incorporated herein by reference.
Exhibit A(3)(a) Distribution Agreement between NML Equity
Services, Inc. (now Northwestern Mutual
Investment Services, LLC) and The Northwestern
Mutual Life Insurance Company.
Note 3. The following exhibit was filed in electronic format with Post-
Effective Amendment No. 18 on Form S-6 for Northwestern Mutual
Variable Life Account, File No. 2-89972, CIK 0000742277, dated
April 26, 1996, and is incorporated herein by reference:
Exhibit A(6)(a) Articles of Incorporation of The Northwestern Mutual
Life Insurance Company.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant,
Northwestern Mutual Variable Life Account, has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Milwaukee, and State of Wisconsin, on the 15th day of
July, 1998.
NORTHWESTERN MUTUAL VARIABLE LIFE ACCOUNT
(Registrant)
By THE NORTHWESTERN MUTUAL LIFE
INSURANCE COMPANY
(Depositor)
Attest: JOHN M. BREMER By: JAMES D. ERICSON
----------------------------- -----------------------------
John M. Bremer, Executive Vice James D. Ericson, President and
President, General Counsel Chief Executive Officer
and Secretary
By NORTHWESTERN MUTUAL INVESTMENT
SERVICES, LLC
(Depositor)
Attest: MERRILL C. LUNDBERG By: RICHARD L. HALL
----------------------------- -----------------------------
Merrill C. Lundberg, Secretary Richard L. Hall,
President and CEO
Pursuant to the requirements of the Securities Act of 1933, the depositors
have duly caused this Registration Statement to be signed on their behalf by the
undersigned, thereunto duly authorized, and their seals to be hereunto affixed,
all in the City of Milwaukee, and State of Wisconsin, on the 15th day of July,
1998.
THE NORTHWESTERN MUTUAL LIFE
INSURANCE COMPANY (Depositor)
Attest: JOHN M. BREMER By: JAMES D. ERICSON
----------------------------- -----------------------------
John M. Bremer, Executive Vice James D. Ericson, President and
President, General Counsel Chief Executive Officer
and Secretary
NORTHWESTERN MUTUAL INVESTMENT
SERVICES, LLC (Depositor)
Attest: MERRILL C. LUNDBERG By: RICHARD L. HALL
----------------------------- -----------------------------
Merrill C. Lundberg, Secretary Richard L. Hall,
President and CEO
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities with the depositor and on the dates indicated:
Signature Title
- --------- -----
JAMES D. ERICSON Trustee, President and Dated July
- --------------------------- Principal Executive and 15, 1998
James D. Ericson Financial Officer
II-4
<PAGE>
GARY E. LONG Vice President, Controller
- --------------------------- and Principal Accounting
Gary E. Long Officer
HAROLD B. SMITH* Trustee
- ---------------------------
Harold B. Smith
J. THOMAS LEWIS* Trustee
- ---------------------------
J. Thomas Lewis
PATRICIA ALBJERG GRAHAM* Trustee
- ---------------------------
Patricia Albjerg Graham
DONALD J. SCHUENKE* Trustee
- ---------------------------
Donald J. Schuenke
R. QUINTUS ANDERSON* Trustee
- ---------------------------
R. Quintus Anderson
STEPHEN F. KELLER* Trustee Dated
- --------------------------- July 15, 1998
Stephen F. Keller
PIERRE S. du PONT* Trustee
- ---------------------------
Pierre S. du Pont
J. E. GALLEGOS* Trustee
- ---------------------------
J. E. Gallegos
KATHRYN D. WRISTON* Trustee
- ---------------------------
Kathryn D. Wriston
BARRY L. WILLIAMS* Trustee
- ---------------------------
Barry L. Williams
GORDON T. BEAHAM III* Trustee
- ---------------------------
Gordon T. Beaham III
DANIEL F. McKEITHAN, JR.* Trustee
- ---------------------------
Daniel F. McKeithan, Jr.
ROBERT E. CARLSON* Trustee
- ---------------------------
Robert E. Carlson
II-5
<PAGE>
EDWARD E. BARR* Trustee
- ---------------------------
Edward E. Barr
ROBERT C. BUCHANAN* Trustee
- ---------------------------
Robert C. Buchanan
SHERWOOD H. SMITH, JR.* Trustee
- ---------------------------
Sherwood H. Smith, Jr.
H. MASON SIZEMORE, JR.* Trustee
- ---------------------------
H. Mason Sizemore, Jr.
JOHN J. STOLLENWERK* Trustee
- ---------------------------
John J. Stollenwerk
GEORGE A. DICKERMAN* Trustee
- ---------------------------
George A. Dickerman
GUY A. OSBORN* Trustee Dated
- --------------------------- July 15, 1998
Guy A. Osborn
JOHN E. STEURI* Trustee
- ---------------------------
John E. Steuri
STEPHEN N. GRAFF* Trustee
- ---------------------------
Stephen N. Graff
BARBARA A. KING* Trustee
- ---------------------------
Barbara A. King
TIMOTHY D. PROCTOR* Trustee
- ---------------------------
Timothy D. Proctor
*By: JAMES D. ERICSON
-----------------------------------
James D. Ericson, Attorney in fact,
pursuant to the Power of Attorney
attached hereto
II-6
<PAGE>
POWER OF ATTORNEY
The undersigned Trustees of THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
hereby constitute and appoint James D. Ericson and Robert E. Carlson, or either
of them, their true and lawful attorneys and agents to sign the names of the
undersigned Trustees to (1) the registration statement or statements to be filed
under the Securities Act of 1933 and to any instrument or document filed as part
thereof or in connection therewith or in any way related thereto, and any and
all amendments thereto in connection with variable contracts issued or sold by
The Northwestern Mutual Life Insurance Company or any separate account credited
therein and (2) the Form 10-K Annual Report or Reports of The Northwestern
Mutual Life Insurance Company and/or its separate accounts for its or their
fiscal year ended December 31, 1997 to be filed under the Securities Exchange
Act of 1934 and to any instrument or document filed as part thereof or in
connection therewith or in any way related thereto, and any and all amendments
thereto. "Variable contracts" as used herein means any contracts providing for
benefits or values which may vary according to the investment experience of any
separate account maintained by The Northwestern Mutual Life Insurance Company,
including variable annuity contracts and variable life insurance policies. Each
of the undersigned hereby ratifies and confirms all that said attorneys and
agents shall do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, each of the undersigned has subscribed these presents
this 23rd day of July, 1997.
R. QUINTUS ANDERSON Trustee
-----------------------------
R. Quintus Anderson
EDWARD E. BARR Trustee
-----------------------------
Edward E. Barr
GORDON T. BEAHAM III Trustee
-----------------------------
Gordon T. Beaham III
ROBERT C. BUCHANAN Trustee
-----------------------------
Robert C. Buchanan
ROBERT E. CARLSON Trustee
-----------------------------
Robert E. Carlson
GEORGE A. DICKERMAN Trustee
-----------------------------
George A. Dickerman
II-7
<PAGE>
PIERRE S. du PONT Trustee
-----------------------------
Pierre S. du Pont
JAMES D. ERICSON Trustee
-----------------------------
James D. Ericson
J. E. GALLEGOS Trustee
-----------------------------
J. E. Gallegos
STEPHEN N. GRAFF Trustee
-----------------------------
Stephen N. Graff
PATRICIA ALBJERG GRAHAM Trustee
-----------------------------
Patricia Albjerg Graham
STEPHEN F. KELLER Trustee
-----------------------------
Stephen F. Keller
BARBARA A. KING Trustee
-----------------------------
Barbara A. King
J. THOMAS LEWIS Trustee
-----------------------------
J. Thomas Lewis
DANIEL F. McKEITHAN, JR. Trustee
-----------------------------
Daniel F. McKeithan, Jr.
GUY A. OSBORN Trustee
-----------------------------
Guy A. Osborn
II-8
<PAGE>
TIMOTHY D. PROCTOR Trustee
-----------------------------
Timothy D. Proctor
DONALD J. SCHUENKE Trustee
-----------------------------
Donald J. Schuenke
H. MASON SIZEMORE, JR. Trustee
-----------------------------
H. Mason Sizemore, Jr.
HAROLD B. SMITH Trustee
-----------------------------
Harold B. Smith
SHERWOOD H. SMITH, JR. Trustee
-----------------------------
Sherwood H. Smith, Jr.
JOHN E. STEURI Trustee
-----------------------------
John E. Steuri
JOHN J. STOLLENWERK Trustee
-----------------------------
John J. Stollenwerk
BARRY L. WILLIAMS Trustee
-----------------------------
Barry L. Williams
KATHRYN D. WRISTON Trustee
-----------------------------
Kathryn D. Wriston
II-9
<PAGE>
EXHIBIT INDEX
EXHIBITS FILED WITH FORM S-6
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
FOR
NORTHWESTERN MUTUAL VARIABLE JOINT LIFE
Exhibit Number Exhibit Name
- -------------- ------------
Exhibit A(1) See Note 1.
Exhibit A(2) Not applicable.
Exhibit A(3) Distributing Contracts:
Exhibit A(3)(a) See Note 2.
Exhibit A(3)(b) Not applicable.
Exhibit A(3)(c) Schedules of sales commissions.
Exhibit A(4) Not applicable.
Exhibit A(5)(a) Variable Life Insurance Policy, RR.VJL, Flexible
Premium Variable Joint Life Policy, with
application, including Policy Split Provision
(sex-neutral)
Exhibit A(5)(b) Variable Life Insurance Policy, RR.VJL, Flexible
Premium Variable Joint Life Policy, with
application, including Policy Split
Provision (sex-distinct)
Exhibit A(6)(a) See Note 3.
Exhibit A(6)(b) By-laws of The Northwestern Mutual Life Insurance
Company.
Exhibit A(7) Not applicable.
Exhibit A(8) See Note 1.
Exhibit A(9) Not applicable.
Exhibit A(10) Application form is included in Exhibit A(5)(a) above.
Exhibit A(12) Memorandum describing issuance, transfer and
redemption procedures pursuant to Rule 6e-
3(T)(b)(12)(iii) and method of computing cash
adjustment upon of right to exchange for fixed-
benefit insurance pursuant to Rule 6e-
3(T)(b)(13)(v)(B).
<PAGE>
Exhibit 2 Opinion and consent of John M. Bremer as to the
legality of the securities being registered. (to
be filed by amendment)
Exhibit C(1) Consent of Price Waterhouse LLP. (to be filed by
amendment)
Exhibit C(6) Opinion and consent of William C. Koenig, F.S.A.
- ------------------
Note 1. The following exhibits were filed in electronic format with the
Registration Statement on Form S-6 for Northwestern Mutual Variable
Life Account, File No. 333-36865, CIK 0000742277, dated October 1,
1997, and are incorporated herein by reference:
Exhibit A(1) Resolution of Board of Trustees of The
Northwestern Mutual Life Insurance Company
establishing the Account.
Exhibit A(8) Agreement among the Account and its Co-
Depositors.
Note 2. The following exhibit was filed in electronic format with the
Registration Statement on Form N-4 for NML Variable Annuity Account A,
File No. 333-22455, CIK 0000790162, dated February 27, 1997, and is
incorporated herein by reference.
Exhibit A(3)(a) Distribution Agreement between NML Equity
Services, Inc. (now Northwestern Mutual
Investment Services, Inc.) and The Northwestern
Mutual Life Insurance Company.
Note 3. The following exhibit was filed in electronic format with
Post-Effective Amendment No. 18 on Form S-6 for Northwestern Mutual
Variable Life Account, File No. 2-89972, CIK 0000742277, dated April
26, 1996, and is incorporated herein by reference:
Exhibit A(6)(a) Articles of Incorporation of The Northwestern
Mutual Life Insurance Company.
<PAGE>
Exhibit A(3)(c)
STANDARD FULL-TIME SPECIAL AND SOLICITING AGENTS' COMMISSION
AND FEE SCHEDULE
VARIABLE JOINT LIFE
1. For purposes of this Subsection:
(a) "Writing Agent" means the Agent whose name appears on the
application as Agent of Record or the Agent who has been given credit
by the written consent of the original Agent of Record.
(b) "Target premium" means the premium level over which the
compensation rates vary in the first ten policy years.
2. First Year Commissions
The Writing Agent shall be entitled to receive first year commissions
equal to percentages (commission rates) of premiums collected on
Variable Joint Life policies and contracts issued upon applications
procured by him pursuant to his Agent's contract as set forth below:
FIRST YEAR COMMISSION
<TABLE>
<CAPTION>
-------------------------------------------------------
Issue Age of Premium Below Premium Above
Younger Insured Target Premium Target Premium
-------------------------------------------------------
<S> <C> <C>
20-60 40.0% 2.75%
-------------------------------------------------------
61 39.5 2.75
-------------------------------------------------------
62 39.0 2.75
-------------------------------------------------------
63 38.5 2.75
-------------------------------------------------------
64 38.0 2.75
-------------------------------------------------------
65 37.5 2.75
-------------------------------------------------------
66 37.0 2.75
-------------------------------------------------------
67 36.5 2.75
-------------------------------------------------------
68 36.0 2.75
-------------------------------------------------------
69 35.5 2.75
-------------------------------------------------------
70 35.0 2.75
-------------------------------------------------------
71 34.5 2.75
-------------------------------------------------------
72 34.0 2.75
-------------------------------------------------------
73 33.5 2.75
-------------------------------------------------------
74 33.0 2.75
-------------------------------------------------------
75 32.5 2.75
-------------------------------------------------------
76 32.0 2.75
-------------------------------------------------------
77 31.0 2.75
-------------------------------------------------------
78 29.0 2.75
-------------------------------------------------------
79 27.0 2.75
-------------------------------------------------------
80 25.0 2.75
-------------------------------------------------------
81 23.0 2.75
-------------------------------------------------------
82 21.0 2.75
-------------------------------------------------------
83 19.0 2.75
-------------------------------------------------------
84 17.0 2.75
-------------------------------------------------------
85 15.0 2.75
-------------------------------------------------------
</TABLE>
1
<PAGE>
3. Renewal Commissions
The Writing Agent shall be entitled to receive renewal commissions in
policy years two through ten equal to 6% on premium below the target
premium and 2.75% on premium above the target premium, on Variable
Joint Life policies and contracts issued upon applications procured by
him pursuant to his Agent's contract.
4. Quality Incentive Compensation
The Writing Agent shall be entitled to receive Quality Incentive
Compensation equal to a percentage of the renewal commissions paid on
premium for Variable Joint Life policies issued upon applications
procured by him in accordance with policies and procedures as from
time to time amended by the Company and published in the Full-Time
Agent Compensation Manual.
5. Persistency Fees
A persistency fee shall be paid in an amount equal to 2.75% of
premiums collected by the Company which fall due in the eleventh and
subsequent policies years on Variable Joint Life policies issued upon
applications on which the Writing Agent's name appears as solicitor.
No persistency fee shall be paid on business procured by him after he
ceases to be under an agency contract providing for such fees.
6. Trail Compensation
Commencing at the end of policy year six and in each subsequent policy
year, Writing Agent shall be entitled to receive compensation equal to
0.1% of the account value at the end of the policy year on Variable
Joint Life policies and contracts. In policy years eleven and later,
no trail compensation shall be paid on business procured by the Agent
after he ceases to be under an agency contract providing for such
fees.
2
<PAGE>
Exhibit A(5)(a)
The Northwestern Mutual Life Insurance Company agrees to pay the benefits
provided in this policy,
subject to its terms and conditions.
Signed at Milwaukee, Wisconsin on the Date of Issue.
FLEXIBLE PREMIUM VARIABLE JOINT LIFE INSURANCE POLICY
INSURANCE PAYABLE ON SECOND DEATH
ELIGIBLE FOR ANNUAL DIVIDENDS
Flexible premiums.
Benefits reflect investment results.
Variable benefits described in Sections 1, 3, 6, 7 and 8.
THE DEATH BENEFIT AND CASH VALUE UNDER THIS POLICY ARE VARIABLE. THEY MAY
INCREASE OR DECREASE DAILY DEPENDING ON THE INVESTMENT RESULTS OF THE SEPARATE
ACCOUNT. THE AMOUNT OF THE DEATH BENEFIT AND THE AMOUNT OF THE CASH VALUE ARE
NOT GUARANTEED.
RIGHT TO RETURN POLICY. Please read this policy carefully. The policy may be
returned by the Owner for any reason within ten days after it was received. The
policy may be returned to your agent or to the Home Office of the Company at 720
East Wisconsin Avenue, Milwaukee, WI 53202. If returned, the policy will be
considered void from the beginning. The Company will refund the sum of (a) the
difference between any premium paid and the amount allocated to the Separate
Account plus (b) the value of the policy in the Separate Account on the date the
returned policy is received.
INSURED John J. Doe AGE AND SEX 35 Male-SN
Jane J. Doe 35 Female-SN
POLICY DATE December 31, 1998 POLICY NUMBER 10 000 000
PLAN Flexible Premium SPECIFIED AMOUNT $1,000,000.00 Joint Life
Variable Insurance
RP.VJL.(1298)
<PAGE>
THIS POLICY IS A LEGAL CONTRACT BETWEEN THE OWNER AND
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY.
READ YOUR POLICY CAREFULLY.
GUIDE TO POLICY PROVISIONS
BENEFITS AND PREMIUMS
SECTION 1. THE CONTRACT
Life Insurance Benefit payable on second death. Incontestability.
Suicide. Definition of dates. Reports to Owner.
SECTION 2. OWNERSHIP
Rights of the Owner. Assignment as collateral.
SECTION 3. DEATH BENEFIT
Description of death benefit options. Changes to death benefits.
SECTION 4. PREMIUMS, TRANSFERS AND REINSTATEMENT
Payment of premiums. Calculation and allocation of net premiums.
Transfer of assets. Premium limitations. Grace period of 61 days
to pay premium. How to reinstate the policy.
SECTION 5. DIVIDENDS
Annual dividends. Use of dividends. Dividend at death.
SECTION 6. THE SEPARATE ACCOUNT
The Separate Account and the Divisions. Valuation of assets.
SECTION 7. DETERMINATION OF VALUES
Policy Value. Monthly Policy Charge.
SECTION 8. CASH VALUE AND SURRENDER
Cash value. Surrender. Deferral of payments.
SECTION 9. LOANS AND WITHDRAWALS
Policy loans. Interest on loans. Withdrawals.
SECTION 10. BENEFICIARIES
Naming and change of beneficiaries. Succession in interest of
beneficiaries.
ADDITIONAL BENEFITS (IF ANY)
APPLICATION
RR.VJL.(1298)
<PAGE>
Appendix A
BENEFITS AND PREMIUMS
DATE OF ISSUE - DECEMBER 31, 1998
Plan: Flexible Premium Variable Joint Life Insurance
Specified Amount: $1,000,000.00
Death Benefit Option: Specified Amount (Option A)
Definition of Life Insurance Test: Guideline Premium/Cash Value Corridor Test
The Age 100 Date (Section 3) is December 31, 2063.
The Final Premium Date (Section 4) is December 30, 2058.
The minimum premium (Section 4.4) is $25.00.
The maximum premium under the Guideline Premium/Cash Value Corridor Test:
Guideline Single Premium = $ 93,490.00
Guideline Annual Level Premium = $ 9,000.00
The minimum withdrawal amount (Section 9.5) is $250.00.
This policy is issued in a select (nonsmoker) rate class on John J. Doe and in a
select (nonsmoker) rate class on Jane J. Doe.
DIRECT BENEFICIARY JANE M. DOE, DAUGHTER OF THE INSURED
OWNER JOHN J. DOE, THE INSURED
<PAGE>
POLICY NUMBER 10 000 000
SCHEDULE OF CHARGES
The Premium Expense Charge (Section 4.2) is the sum of the following:
1. Sales Load:
<TABLE>
<CAPTION>
Policy Years 1 Policy Years
Premium Paid - 10 after 10
------------ ------------------------------
<S> <C> <C>
Up to $ $7,160.00 6.4% 2.4%
In Excess of $7,160.00 2.4% 2.4%
</TABLE>
2. Federal Deferred Acquisition Cost Charge l.25% of premium
3. Premium Tax Charge 2.35% of premium
The Premium Expense Charge for Federal Deferred Acquisition Cost
and Premium Tax may change to reflect changes in tax law.
Monthly Policy Charge (Section 7.2):
The maximum monthly Administrative Charge is $7.50.
The maximum monthly Underwriting and Issue Charge is $15.00. There is
no charge after the tenth policy year.
The maximum monthly Mortality and Expense Risk Charge during the first
ten policy years is the sum of .075% of Policy Value less policy debt,
plus $11.67. The maximum monthly Mortality and Expense Risk Charge
after the first ten policy years is .075% of Policy Value less policy
debt.
The maximum monthly Deferred Sales Charge is $44.75. There is no
charge after the tenth policy year.
RP.VJL.(1298) Page 4
<PAGE>
POLICY NUMBER 10 000 000
SCHEDULE OF CHARGES (continued)
Maximum Transaction Charges:
The maximum charge for death benefit option changes (Section 3.2) is
$250.00 per change.
The maximum charge for Specified Amount changes (Section 3.3) is
$25.00 per change for more than one change during any policy year.
The maximum transfer fee (Section 4.3) is $25.00 per transfer for more
than 12 transfers during any policy year.
The maximum withdrawal charge (Section 9.5) is $25.00 per withdrawal.
Surrender Charge (Section 8.3):
The surrender charge percentage is 50% during the first policy year; this
percentage is decreased by 0.462963% on each monthly processing date during
the second through tenth policy years.
The maximum surrender charge is $3,580.00 during the first policy year;
this charge is decreased by $33.15 on each monthly processing date during
the second through tenth policy years.
There is no surrender charge after the tenth policy year.
RP.VJL.(1298) Page 5
<PAGE>
POLICY NUMBER 10 000 000
TABLE OF GUARANTEED MAXIMUM COST OF INSURANCE RATES
MONTHLY RATES PER $1,000.00
(Section 7.3)
<TABLE>
<CAPTION>
Policy Monthly Policy Monthly Policy Monthly
Year Rate Year Rate Year Rate
<S> <C> <C> <C> <C> <C>
1 .00021 26 .17199 51 9.14455
2 .00067 27 .20338 52 10.34507
3 .00121 28 .24132 53 11.62343
4 .00188 29 .28836 54 12.95410
5 .00266 30 .34564 55 14.35484
6 .00362 31 .41299 56 15.82003
7 .00477 32 .49213 57 17.37666
8 .00616 33 .58239 58 19.06350
9 .00774 34 .68515 59 20.97430
10 .00962 35 .80292 60 23.27615
11 .01188 36 .94192 61 26.44250
12 .01447 37 1.11784 62 31.28571
13 .01756 38 1.30952 63 39.58046
14 .02112 39 1.55439 64 54.63869
15 .02533 40 1.84737 65 83.33333
16 .03028 41 2.18582 After 65 .00000
17 .03617 42 2.57328
18 .04341 43 3.00376
19 .05207 44 3.47972
20 .06228 45 4.00943
21 .07449 46 4.60979
22 .08875 47 5.29696
23 .10518 48 6.08932
24 .12401 49 7.00369
25 .14593 50 8.02382
</TABLE>
The monthly rates shown above are based on the appropriate Commissioners 1980
Standard Ordinary Smoker and/or Nonsmoker Mortality Table D for the class of the
Insureds.
RP.VJL.(1298) Page 6
<PAGE>
POLICY NUMBER 10 000 000
GUIDELINE PREMIUM/CASH VALUE CORRIDOR PERCENTAGES
The Corridor Percentages are used to determine the Minimum Death Benefit under
the Guideline Premium/Cash Value Corridor Test (Section 3.1).
<TABLE>
<CAPTION>
Policy Policy Policy
Year Corridor % Year Corridor % Year Corridor %
<S> <C> <C> <C> <C> <C>
1 250 26 130 51 105
2 250 27 128 52 105
3 250 28 126 53 105
4 250 29 124 54 105
5 250 30 122 55 105
6 250 31 120 56 105
7 243 32 119 57 104
8 236 33 118 58 103
9 229 34 117 59 102
10 222 35 116 60 101
11 215 36 115 After 60 100
12 209 37 113
13 203 38 111
14 197 39 109
15 191 40 107
16 185 41 105
17 178 42 105
18 171 43 105
19 164 44 105
20 157 45 105
21 150 46 105
22 146 47 105
23 142 48 105
24 138 49 105
25 134 50 105
</TABLE>
RR.VJL.(1298) Page 7
<PAGE>
POLICY NUMBER 10 000 000
SEPARATE ACCOUNT DIVISIONS
(Section 6)
Money Market Division
Select Bond Division
High Yield Bond Division
Balanced Division
Index 500 Stock Division
Growth & Income Stock Division
Growth Stock Division
International Equity Division
Aggressive Growth Stock Division
The Initial Allocation Date is January 15, 1999.
RR.VJL.(1298) Page 8
<PAGE>
SECTION 1. THE CONTRACT
1.1 LIFE INSURANCE BENEFIT
The Northwestern Mutual Life Insurance Company will pay a benefit on the
death of the second of the Insureds to die (the "second death") while this
policy is in force. No benefit is payable on the death of the first of the
Insureds to die. Subject to the terms and conditions of the policy:
- payment of the death proceeds will be made after proof of the deaths
of both Insureds is received at the Home Office; and
- payment will be made to the beneficiary or other payee under Section
10.
The amount of the death proceeds will be:
- the death benefit (Section 3.1); less
- the amount of any policy debt (Section 9.3); less
- any Monthly Policy Charges due and unpaid if the second death occurs
during the grace period (Section 4.5).
These amounts will be determined as of the date of the second death.
The Company will pay interest on the death proceeds from the date of the
second death until the proceeds are paid. Interest will be at an annual
effective rate of not less than 2%, or at any higher rate required by state law.
1.2 NOTICE AND PROOF OF DEATH
Written notice and proof of the death of each Insured must be given to the
Company as soon as reasonably possible after each death.
RR.VJL.(1298) 10
<PAGE>
1.3 ENTIRE CONTRACT; CHANGES
This policy, including the attached application and any amendments,
endorsements or riders, is the entire contract. Statements in the application
are representations and not warranties. A change in the policy is valid only if
it is approved in writing by an officer of the Company. The Company may require
that the policy be sent to it for endorsement to show a change. No agent has
the authority to change the policy or to waive any of its terms.
1.4 INCONTESTABILITY
In issuing the insurance, the Company has relied on the application. While
the insurance is contestable, the Company, on the basis of a material
misstatement in the application, may rescind the insurance or deny a claim.
The Company will not contest insurance under this policy after that
insurance has been in force, during the lifetime of at least one Insured, for
two years from the Date of Issue or for two years from the effective date of a
reinstatement (Section 4.6). An increase in the amount of insurance after the
Date of Issue, which occurred upon the request of the Owner and was subject to
the Company's insurability requirements, will be incontestable after the
increase has been in force, during the lifetime of at least one Insured, for two
years from the effective date of the increase.
1.5 SUICIDE
If either Insured dies by suicide within one year from the Date of Issue,
the policy will terminate. The amount payable by the Company will be limited to
the premiums paid, less the amount of any policy debt and withdrawals. If either
Insured dies by suicide within one year from the effective date of an increase
in the amount of insurance which occurred upon the request of the Owner and was
subject to the Company's insurability requirements, the amount payable with
respect to such increase will be limited to the Monthly Policy Charges plus any
transaction charges attributable to the increase.
1.6 POLICY DATE AND DATE OF ISSUE
Monthly processing dates and policy months, years and anniversaries are
computed from the Policy Date. The contestable and suicide periods begin with
the Date of Issue. These dates are shown on page 3. The Date of Issue for any
insurance issued under Specified Amount Changes (Section 3.3) will be shown on
an amendment to the Schedule of Benefits and Premiums.
1.7 MISSTATEMENT OF AGE
If the age of either insured has been misstated, the death benefit and
Policy Value will be modified by recalculating all Monthly Policy Charges based
on the correct age of the Insureds.
1.8 PAYMENTS BY THE COMPANY
All payments by the Company under this policy are payable at its Home
Office.
1.9 REPORTS TO OWNER
At least once each policy year, the Company will send to the Owner:
- a statement of the death benefit, the Policy Value, and any policy
debt, including loan interest.
- a report of the Separate Account, including financial statements.
<PAGE>
- any other information required by law.
SECTION 2. OWNERSHIP
2.1 THE OWNER
The Owner is named on page 3. The Owner, the Owner's successor or the
Owner's transferee may exercise policy rights without the consent of any
beneficiary, except to the extent the Owner's rights are restricted by a
designation of an irrevocable beneficiary. After the second death, policy
rights may be exercised only as provided in Section 10.
2.2 TRANSFER OF OWNERSHIP
The Owner may transfer the ownership of this policy. Written proof of
transfer satisfactory to the Company must be received at its Home Office. The
transfer will then take effect as of the date that it was signed. The Company
may require that the policy be sent to it for endorsement to show the transfer.
2.3 COLLATERAL ASSIGNMENT
The Owner may assign this policy as collateral security. The Company is
not responsible for the validity or effect of the collateral assignment. The
Company will not be responsible to an assignee for any payment or other action
taken by the Company before receipt of the assignment in writing at its Home
Office.
The interest of any beneficiary will be subject to any collateral
assignment made either before or after the beneficiary is named, unless the
beneficiary was designated an irrevocable beneficiary before the assignment.
The collateral assignee is not an Owner. The collateral assignment is not
a transfer of ownership. Ownership can be transferred only by complying with
Section 2.2.
RR.VJL.(1298) 11
<PAGE>
SECTION 3. DEATH BENEFIT
3.1 DEATH BENEFIT OPTIONS
This policy provides for three death benefit options prior to the Age 100
Date. The option in effect and the Age 100 Date are shown on page 3.
SPECIFIED AMOUNT (OPTION A) - The death benefit before the Age 100 Date is the
greater of:
- the Specified Amount; or
- the Minimum Death Benefit.
SPECIFIED AMOUNT PLUS POLICY VALUE (OPTION B) - The death benefit before the
Age 100 Date is the greater of:
- the Specified Amount plus the Policy Value; or
- the Minimum Death Benefit.
SPECIFIED AMOUNT PLUS PREMIUMS PAID
(OPTION C) - The death benefit before the Age 100 Date is the greater of:
- the Specified Amount plus the sum of the premiums paid; or
- the Minimum Death Benefit.
MINIMUM DEATH BENEFIT. The Minimum Death Benefit is the amount required to
maintain this policy as a life insurance contract for federal tax purposes. The
test used for determining compliance with the federal tax definition of a life
insurance contract is shown on page 3 and will be either:
(1) the Guideline Premium/Cash Value Corridor Test: in that case, the Minimum
Death Benefit equals the greater of the Policy Value multiplied by the
corridor percentage shown on page 7 for the current policy year or the
minimum amount required to maintain this policy as a life insurance
contract for federal tax purposes; or
(2) the Cash Value Accumulation Test: in that case, the Minimum Death Benefit
equals the greater of the Policy Value divided by the Net Single Premium
shown on page 7 for the current policy year or the minimum amount required
to maintain this policy as a life insurance contract for federal tax
purposes.
AGE 100 DATE AND LATER. The death benefit on and after the Age 100 Date will
be the greater of the Policy Value or the minimum amount required to maintain
this policy as a life insurance contract for federal tax purposes.
3.2 DEATH BENEFIT OPTION CHANGES
Subject to approval by the Company, the Owner may change the death benefit
option upon written request. This change will be effective on the first monthly
processing date following receipt of the request at the Home Office. The
Company reserves the right to charge for a death benefit option change. This
charge will be deducted from the Policy Value and will not exceed the amount
shown on page 5. A change will not be allowed if the Specified Amount following
a change would be less than the minimum amount the Company would issue at the
time of change.
CHANGES TO OPTION A. The death benefit option may be changed to Option A at
any time before the Age 100 Date. On the effective date of change, the
Specified Amount will be changed as follows:
(1) If the change is from Option B to Option A, the Specified Amount after the
change will be equal to the Specified Amount before the change plus the
Policy Value on the effective date of the change.
<PAGE>
(2) If the change is from Option C to Option A, the Specified Amount after the
change will be equal to the Specified Amount before the change plus the sum
of the premiums paid as of the effective date of the change.
CHANGES TO OPTION B OR OPTION C. The death benefit option may be changed to
Option B or Option C at any time before the policy anniversary nearest the older
Insured's 85th birthday provided the following requirements are met:
- both Insureds are alive;
- evidence of insurability is given that is satisfactory to the Company;
and
- under the Company's underwriting standards, both Insureds are in the
same underwriting classification as, or in a better underwriting
classification than, they were in on the Date of Issue.
On the effective date of change, the Specified Amount will be changed as
follows:
(1) If the change is from Option A to Option B, the Specified Amount after the
change will be equal to the Specified Amount before the change minus the
Policy Value on the effective date of the change.
(2) If the change is from Option A to Option C, the Specified Amount after the
change will be equal to the Specified Amount before the change minus the
sum of the premiums paid as of the effective date of the change.
(3) If the change is from Option B to Option C, the Specified Amount after the
change will be equal to the Specified Amount before the change plus (a) the
Policy Value on the effective date of the change, minus (b) the sum of the
premiums paid as of the effective date of the change.
(4) If the change is from Option C to Option B, the Specified Amount after the
change will be equal to the Specified Amount before the change plus (a)
the sum of the premiums paid as of the effective date of the change, minus
(b) the Policy Value on the effective date of the change.
RR.VJL.(1298) 12
<PAGE>
3.3 SPECIFIED AMOUNT CHANGES
The Owner may change the Specified Amount upon written request subject to
approval by the Company. This change will be effective on the first monthly
processing date following receipt of the request at the Home Office. The
Company reserves the right to charge for more than one Specified Amount change
in a policy year. This charge will be deducted from the Policy Value and will
not exceed the amount shown on page 5.
INCREASES. An increase will be made only if, at the time applied for, the
following requirements are met:
- both Insureds are alive;
- the insurance in force, as increased, will be within the Company's
issue limits;
- the increase request is received prior to the policy anniversary
nearest the older Insured's 85th birthday;
- evidence of insurability is given that is satisfactory to the Company;
and
- under the Company's underwriting standards, both Insureds are in the
same underwriting classification as, or in a better underwriting
classification than, they were in on the Date of Issue.
DECREASES. A decrease will not be allowed if the Specified Amount following the
decrease would be less than the minimum amount the Company would issue at the
time of change. For the purposes of incontestability and suicide provisions
(Section 1.4 and Section 1.5), a decrease in Specified Amount will first reduce
any past increases in the reverse order in which they occurred and then reduce
the Specified Amount originally issued.
SECTION 4. PREMIUMS, TRANSFERS AND REINSTATEMENT
4.1 PREMIUM PAYMENT
Premiums may be paid to the Company at any time on or before the Final
Premium Date shown on page 3. All premiums after the first are payable at the
Home Office or to an authorized agent. A receipt signed by an officer of the
Company will be furnished on request. The minimum premium the Company will
accept is shown on page 3. Other premium limitations are described in
Section 4.4.
4.2 NET PREMIUM
The net premium is the amount of each premium paid that is available for
allocation to the Divisions of the Separate Account. The amount of the net
premium will be:
- the premium paid; less
- the Premium Expense Charge.
The Premium Expense Charge will consist of the amounts shown on page 4.
4.3 ALLOCATION OF NET PREMIUMS
AND SUBSEQUENT TRANSFERS
For premiums paid to the Company prior to the Initial Allocation Date, the
net premiums will be allocated to the Money Market Division on the date the
premiums are received in the Home Office. The Initial Allocation Date is shown
on page 8.
On the Initial Allocation Date, amounts in the Money Market Division will
be allocated in accordance with the application. This allocation will remain in
effect for subsequent net premiums, loan repayments,
<PAGE>
and dividends credited unless changed by the Owner by written request. Any
change in allocation will be in effect for net premiums, loan repayments, and
dividends credited to the policy following the receipt of the written request at
the Home Office. Allocations must be in whole percentages.
On or after the Initial Allocation Date, the Owner may transfer the amounts
invested in any of the Divisions. The transfer will take effect on the date a
written request is received in the Home Office. The Company reserves the right
to charge for more than twelve transfers in a policy year. This charge will be
deducted from the Policy Value and will not exceed the amount shown on page 5.
RR.VJL.(1298) 13
<PAGE>
4.4 PREMIUM LIMITATIONS
A premium payment that would increase the policy's death benefit more than
it increases the Policy Value will be accepted only if:
- both Insureds are alive;
- the insurance in force, as increased, will be within the Company's
issue limits;
- the premium payment is received prior to the policy anniversary
nearest the older Insured's 85th birthday;
- evidence of insurability is given that is satisfactory to the Company;
and
- under the Company's underwriting standards, both Insureds are in the
same underwriting classification as, or in a better underwriting
classification than, they were in on the Date of Issue.
If the Definition of Life Insurance Test shown on page 3 is the Guideline
Premium/Cash Value Corridor Test, then the Company will not accept any premium
that disqualifies this policy as a life insurance contract for federal tax
purposes. Further, the Company reserves the right to make distributions or
refunds of excess premium (with interest as required by the federal tax law)
from this policy as necessary to continue to qualify the policy as a life
insurance contract for federal tax purposes.
4.5 GRACE PERIOD
A grace period of 61 days will be allowed for the payment of sufficient
premium to keep the policy in force if the cash value on a monthly processing
date is less than the current Monthly Policy Charge; however, no premium will be
accepted after the Final Premium Date shown on page 3. The minimum premium that
must be paid is three times the Monthly Policy Charge due when the insufficiency
occurred.
The grace period will begin on the date the Company sends written notice of
the insufficiency. The grace period will end 61 days after the notice is sent.
The notice will be sent to the Owner and will state the date the grace period
ends and the amount of premium required to keep the policy in force. Upon
receipt of payment, the Company will allocate the net premium, less any Monthly
Policy Charges due and unpaid, to the Divisions of the Separate Account
according to the allocation of net premiums then in effect.
The policy will remain in force during the grace period. If sufficient
premium is not paid by the end of the grace period, the policy will terminate
with no value.
If the second death occurs during the grace period, any Monthly Policy
Charges due and unpaid will be deducted from the death proceeds of the policy.
4.6 REINSTATEMENT
CONDITIONS. If this policy has terminated under Section 4.5, it may be
reinstated upon receipt at the Home Office of:
- an application for reinstatement within three years after the end of
the grace period; and
- a reinstatement premium equal to or greater than the minimum
reinstatement premium.
In addition, the Company's insurability requirements must be met.
This policy may not be reinstated:
- if the policy was surrendered for its cash value; or
- if either of the Insureds died after the end of the grace period.
<PAGE>
MINIMUM REINSTATEMENT PREMIUM. The minimum premium needed to reinstate the
policy is:
- the sum of all Monthly Policy Charges (Section 7.2) that were due and
unpaid before the end of the grace period; plus
- three times the Monthly Policy Charge due on the effective date of
reinstatement.
INSURABILITY REQUIREMENTS. These requirements are:
- evidence of insurability is given that is satisfactory to the Company;
and
- under the Company's underwriting standards, both Insureds are in the
same underwriting classification as, or in a better underwriting
classification than, they were in on the Date of Issue, or if only one
Insured was alive at the end of the grace period, that Insured is in
the same underwriting classification as, or in a better underwriting
classification than, that Insured was in on the Date of Issue.
EFFECTIVE DATE OF REINSTATEMENT. If the Company approves the application for
reinstatement, the effective date of reinstatement will be the first monthly
processing date following receipt at the Home Office of the reinstatement
application.
On the effective date of reinstatement, the Policy Value will be equal to:
- the reinstatement premium paid, less the Premium Expense Charge; plus
- any policy debt as of the end of the grace period; less
- the sum of all Monthly Policy Charges that were due and unpaid before
the end of the grace period; less
- the Monthly Policy Charge due on the effective date of reinstatement.
On the effective date of reinstatement, the Policy Value, less any policy debt
that is not repaid, will be allocated to the Divisions of the Separate Account
according to the allocation in effect at the end of the grace period.
RR.VJL.(1298) 14
<PAGE>
SECTION 5. DIVIDENDS
5.1 ANNUAL DIVIDENDS
This policy will share in the divisible surplus of the Company to the
extent it contributes to this surplus. This surplus is determined each year.
This policy's share will be credited as a dividend on the policy anniversary.
Since this policy is not expected to contribute to divisible surplus, it is
not expected that any dividends will be paid.
5.2 USE OF DIVIDENDS
Annual dividends may be paid in cash or used to increase the Policy Value.
Dividends used to increase the Policy Value will be allocated to the Divisions
of the Separate Account according to the allocation of net premiums then in
effect. If no direction is given for the use of dividends, they will be used
to increase the Policy Value.
5.3 DIVIDEND AT DEATH
If a dividend is payable for the period from the beginning of the policy
year to the date of the second death, the dividend is payable as part of the
policy proceeds.
SECTION 6. THE SEPARATE ACCOUNT
6.1 DESCRIPTION
Northwestern Mutual Variable Life Account (the Separate Account) is
registered as a unit investment trust under the Investment Company Act of 1940.
The Separate Account has several Divisions, as shown on page 8. Assets of the
Separate Account are invested in shares of Northwestern Mutual Series Fund, Inc.
(the Fund). The Fund is registered under the Investment Company Act of 1940 as
an open-end, diversified investment company. The Fund has one Portfolio for
each Division. Assets of each Division of the Separate Account are invested in
shares of the corresponding Portfolio of the Fund. Shares of the Fund are
purchased for the Separate Account at their net asset value. The Company may
make available additional Divisions and Portfolios.
Assets will be allocated to the Separate Account to support the operation
of this and other variable life insurance policies. Assets may also be
allocated for other purposes, but not to support the operation of any contracts
or policies other than variable life insurance. Income and realized and
unrealized gains and losses from assets in the Separate Account are credited to
or charged against it without regard to other income, gains or losses of the
Company.
The assets of the Separate Account will be valued on each valuation day.
They are the property of the Company. The portion of these assets equal to
policy reserves and liabilities will not be charged with liabilities arising out
of any other business the Company may conduct. The Company reserves the right
to transfer assets of the Separate Account in excess of these reserves and
liabilities to its general account.
The Owner may exchange this policy for a fixed benefit joint life insurance
policy being offered at that time by the Company if the Fund changes its
investment advisor or if a Portfolio has a material change in its investment
objectives or restrictions. The Company will notify the Owner if there is any
such change.
<PAGE>
The Owner may exchange this policy within 60 days after the notice or the
effective date of the change, whichever is later.
If, in the judgment of the Company, a Portfolio no longer suits the
purposes of this policy due to a change in its investment objectives or
restrictions, the Company may substitute shares of another Portfolio of the Fund
or shares of another mutual fund. Any such substitution will be subject to any
required approval of the Securities and Exchange Commission (SEC), the Wisconsin
Commissioner of Insurance or other regulatory authority.
The Company also may, to the extent permitted by applicable laws and
regulations (including any order of the SEC), make changes as follows:
- the Separate Account or a Division may be operated as a management
company under the Investment Company Act of 1940, or in any other form
permitted by law, if deemed by the Company to be in the best interest
of the policyowners.
- the Separate Account may be deregistered under the Investment Company
Act of 1940 in the event registration is no longer required.
- the provisions of this and other policies may be modified to comply
with any other applicable federal or state laws.
In the event of a substitution or change, the Company may make appropriate
endorsement of this and other policies having an interest in the Separate
Account and take other actions as may be necessary to effect the substitution or
change.
6.2 VALUATION DAY AND VALUATION PERIOD
A valuation day is any day on which the assets of the Separate Account are
valued. A valuation period is a valuation day and any immediately preceding
days which are not valuation days.
Assets are valued as of the close of trading on the New York Stock Exchange
on each day the Exchange is open. Each Division's share of amounts allocated,
transferred or added to a Division or deducted, loaned, transferred or withdrawn
from a Division, on any day, will be determined as of the end of the valuation
period that contains that day.
RR.VJL.(1298) 15
<PAGE>
SECTION 7. DETERMINATION OF VALUES
7.1 POLICY VALUE
On the Policy Date, the Policy Value is equal to the net premium less the
Monthly Policy Charge. On any day after that, the Policy Value is equal to what
it was on the previous day plus any of these items applicable on that day:
- any increase due to investment results as described in Section 7.4 for
the portion of the Policy Value invested in Divisions with a positive
rate of return for the current valuation period;
- interest on the policy debt at an annual effective rate of 5%;
- the net premium, if a premium is paid;
- any policy dividend directed to increase the Policy Value; and minus
any of these items applicable on that day:
- any decrease due to investment results as described in Section 7.4 for
the portion of the Policy Value invested in Divisions with a negative
rate of return for the current valuation period;
- the Monthly Policy Charge;
- any withdrawals; and
- any transaction charges that may result from a withdrawal, a transfer,
a change in the Specified Amount or a change in the death benefit
option.
The Monthly Policy Charge, any withdrawals, and any transaction charges
will be deducted from the Policy Value. The deduction will be allocated to each
Division in proportion to the amounts in each Division.
7.2 MONTHLY POLICY CHARGE
A Monthly Policy Charge is deducted from the Policy Value on each monthly
processing date until the second death and is equal to the sum of the following:
- the Administrative Charge;
- the Underwriting and Issue Charge;
- the Mortality and Expense Risk Charge;
- the Deferred Sales Charge;
- the Cost of Insurance Charge; and
- if there is policy debt, a charge for expenses and taxes associated
with that debt.
The maximum Administrative, Underwriting and Issue, Mortality and Expense
Risk, and Deferred Sales charges are shown on page 4.
7.3 COST OF INSURANCE CHARGE
A Cost of Insurance Charge is deducted from the Policy Value on each
monthly processing date as part of the Monthly Policy Charge. The Cost of
Insurance Charge is the cost of insurance rate times the net amount at risk.
The maximum cost of insurance rates are shown on page 6. The net amount at risk
is (a) minus (b) where:
(a) is the death benefit on the monthly processing date (after deduction
of the Administrative Charge, the Underwriting and Issue Charge, the
Mortality and Expense Risk Charge, the
<PAGE>
Deferred Sales Charge, and, if there is policy debt, a charge for
expenses and taxes associated with that debt) divided by 1.0032737;
and
(b) is the Policy Value on the monthly processing date, after deduction of
the Administrative Charge, the Underwriting and Issue Charge, the
Mortality and Expense Risk Charge, the Deferred Sales Charge, and, if
there is policy debt, a charge for expenses and taxes associated with
that debt.
7.4 INVESTMENT RESULTS
Investment results are reflected in the Policy Value each valuation period.
The investment results for each Division of the Policy Value equal the
Division's share of the Policy Value at the end of the previous valuation period
times the rate of return for that Division for the current valuation period.
The rate of return of a Division for a valuation period is obtained by
dividing the result of (a) minus (b) by (b) where:
(a) is the sum of:
- the value of a share of the corresponding Portfolio of the Fund
at the close of the current valuation period; plus
- the per share amount of any investment income and capital gains
distributed by the Fund for the current valuation period; and
(b) is the value of the share at the close of business for the immediately
preceding valuation period.
The rate of return and corresponding investment results may be positive or
negative. If the rate of return is positive, there will be an increase in
values for the Division; if it is negative, there will be a decrease in values
for the Division.
RR.VJL.(1298) 16
<PAGE>
SECTION 8. CASH VALUE AND SURRENDER
8.1 CASH VALUE
The cash value of this policy is equal to:
- the Policy Value; less
- the surrender charge; less
- any policy debt.
8.2 SURRENDER
The Owner may surrender this policy for its cash value. A written
surrender of all claims, satisfactory to the Company, will be required. The
date of surrender will be the date of receipt at the Home Office of the written
surrender. The policy will terminate, and the cash value will be determined, as
of the end of the valuation period which includes the date of surrender. The
Company may require that the policy be sent to it.
8.3 SURRENDER CHARGE
There is a surrender charge if this policy is surrendered during the first
ten policy years. The surrender charge is a percentage of the total premiums
paid during the first policy year, subject to the maximum surrender charge. The
surrender charge percentage and maximum surrender charge are shown on page 5.
8.4 BASIS OF VALUES
A detailed statement of the method of calculation of all values for this
policy has been filed with the insurance supervisory official of the state in
which this policy is delivered. All values are at least as great as those
required by that state.
8.5 DEFERRAL OF PAYMENTS
The Company reserves the right:
- to defer determination of the cash value and payment of the cash
value;
- to defer payment of a loan or withdrawal; and
- to defer determination of a change in the amount of variable insurance
or other variable amounts payable on the second death, and, if such
determination has been deferred, to defer payment of the death
benefit;
during any period when:
- the New York Stock Exchange is closed or trading on the New York Stock
Exchange is restricted as determined by the SEC; or
- the SEC declares that an emergency exists as a result of which the
sale or determination of investment results is not reasonably
practicable; or
- the SEC, by order, permits deferral for the protection of the
Company's policyowners.
RR.VJL.(1298) 17
<PAGE>
SECTION 9. LOANS AND WITHDRAWALS
9.1 POLICY LOANS
The Owner may obtain a loan from the Company in an amount that, when added
to existing policy debt, is not more than the loan value.
On the date a loan is made, the amount of the loan will be transferred from
the Separate Account to the general account of the Company. This amount will be
deducted from each Division in proportion to the amounts in each Division. On
the date a loan repayment is made, or the date accrued interest is paid, the
amount of the payment will be transferred from the general account of the
Company to the Separate Account. This amount will be allocated to the Divisions
of the Separate Account according to the allocation of net premiums then in
effect.
9.2 LOAN VALUE
The loan value is 90% of:
- the Policy Value on the date of the loan; less
- the surrender charge on the date of the loan.
9.3 POLICY DEBT
Policy debt consists of all outstanding loans and accrued interest. Loan
repayments may be made, or accrued interest paid, at any time. Any policy debt
will be deducted from the policy proceeds.
If the policy debt equals or exceeds the Policy Value less the surrender
charge on a monthly processing date, the policy will terminate with no value
subject to the conditions of the Grace Period (Section 4.5).
9.4 LOAN INTEREST
Interest accrues on a daily basis from the date of the loan. Unpaid
interest is added to the loan.
Interest is payable at an annual effective rate of 5%.
9.5 PARTIAL WITHDRAWALS
The Owner may withdraw a portion of the cash value. However, the Owner may
not:
- withdraw an amount which would reduce the loan value to less than the
policy debt;
- withdraw an amount which would reduce the death benefit to less than
the minimum amount the Company would issue on this plan of insurance
at the time of withdrawal;
- withdraw an amount which would reduce the cash value to less than
three times the most recent Monthly Policy Charge;
- withdraw less than the minimum withdrawal amount shown on page 3; or
- make more than four withdrawals in a policy year.
When a portion of the cash value is withdrawn, the amount invested for this
policy in the Separate Account will be reduced by the amount of the withdrawal.
The reduction will be allocated to each Division
<PAGE>
in proportion to the amounts in each Division. If the death benefit option in
effect at the time of withdrawal is either Option A or Option C, the Specified
Amount will be reduced by the lesser of:
- the amount of the withdrawal; or
- the excess, if any, of the Specified Amount for Option A or the
Specified Amount plus the sum of the premiums paid for Option C, over
the result of (a) minus (b) where:
(a) is the death benefit immediately prior to the withdrawal; and
(b) is the amount of the withdrawal.
The Company reserves the right to charge for withdrawals. This charge
will be deducted from the Policy Value and will not exceed the amount shown on
page 5.
SECTION 10. BENEFICIARIES
10.1 DEFINITION OF BENEFICIARIES
The term "beneficiaries" as used in this policy includes direct
beneficiaries, contingent beneficiaries and further payees.
10.2 NAMING AND CHANGE OF BENEFICIARIES
CONDITIONS. The Owner may name and change the beneficiaries of death proceeds:
- before the second death.
- during the first 60 days after the date of the second death, if the
second Insured to die was not the Owner immediately prior to the
second death. A change made during this 60 days may not be revoked.
EFFECTIVE DATE. A naming or change of a beneficiary will be made on receipt at
the Home Office of a written request that is acceptable to the Company. The
request will then take effect as of the date that it was signed. The Company is
not responsible for any payment or other action that is taken by it before the
receipt of the request. The Company may require that the policy be sent to it
to be endorsed to show the naming or change.
10.3 SUCCESSION IN INTEREST OF
BENEFICIARIES
DIRECT BENEFICIARIES. The proceeds of this policy will be payable in equal
shares to the direct beneficiaries who survive and receive payment. If a direct
beneficiary dies before receiving the direct beneficiary's share, that share
will be payable in equal shares to the other direct beneficiaries who survive
and receive payment.
CONTINGENT BENEFICIARIES. At the death of all of the direct beneficiaries, the
proceeds will be payable in equal shares to the contingent beneficiaries who
survive and receive payment. If a contingent beneficiary dies before receiving
the contingent beneficiary's share, that share will be payable in equal shares
to the other contingent beneficiaries who survive and receive payment.
FURTHER PAYEES. At the death of all of the direct and contingent beneficiaries,
the proceeds will be paid:
- in equal shares to the further payees who survive and receive payment;
or
- if no further payees survive and receive payment, to the estate of the
last to die of all of the direct and contingent beneficiaries who
survive both Insureds.
<PAGE>
OWNER OR THE OWNER'S ESTATE. If no beneficiaries are alive on the date of the
second death, the proceeds will be paid to the Owner or to the Owner's estate.
10.4 GENERAL
TRANSFER OF OWNERSHIP. A transfer of ownership of itself will not change the
interest of a beneficiary.
CLAIMS OF CREDITORS. So far as allowed by law, no amount payable under this
policy will be subject to the claims of creditors of a beneficiary.
<PAGE>
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
720 E. WISCONSIN AVENUE, MILWAUKEE, WISCONSIN 53202
<TABLE>
<CAPTION>
<S><C>
------------------------------------
JOINT LIFE PROTECTION INSURANCE APPLICATION POLICY NUMBER
- ------------------------------------------------------------------------------------------------------------------------------------
/ / Companion policies / / Life & Disability Application / / LTC Application Plan Group Number
/ / APB Option / / Exam (NM, PME, MD) in Home Office
------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
FIRST INSURED (YOUNGER)
ON PAGES 1,2,3 AND 4, "INSURED" REFERS TO THE FIRST INSURED.
- ------------------------------------------------------------------------------------------------------------------------------------
Has an application or informal inquiry ever been made to Northwestern Mutual Life for annuity, life,
long term care, or disability insurance on the life of the insured? / / Yes /X/ No If yes, the last policy number is
---------
1. A. /X/ Mr. / / Mrs. / / Ms. / / Dr. / / Other B. /X/ MALE
----------------- / / FEMALE
NAME: JOHN J DOE
---------------------------------------------------------
(FIRST, MIDDLE INITIAL, LAST)
- ------------------------------------------------------------------------------------------------------------------------------------
C. BIRTHDATE: (MONTH, DAY, YEAR) D. STATE OF BIRTH (or Foreign Country): E. TAXPAYER IDENTIFICATION NUMBER:
12/31/1963 Wisconsin ###-##-####
---------------------------- ----------------------------------- ------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
F. PRIMARY RESIDENCE: STREET OR PO BOX: 1234 Main Street
---------------------------------------------------------------------------
CITY, STATE, ZIP (Country if other than U.S.A.): Milwaukee, WI 53200
---------------------------------------------------------------------------
E-MAIL ADDRESS:
---------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
APPLICANT
- ------------------------------------------------------------------------------------------------------------------------------------
2. Select ONLY ONE: /X/ First Insured @ First Insured's address / / Other (Complete A, B and C)
A. / / Mr. / / Mrs. / / Ms. / / Dr. / / Other
-----------------
PERSONAL
NAME / / MALE
--------------------------------------------------------------------------- / / FEMALE
(FIRST, MIDDLE INITIAL, LAST)
RELATIONSHIP TO INSURED: BIRTHDATE:
------------------------------------------------------ --------------------------------
MONTH DAY YEAR
OR BUSINESS/TRUST
NAME:
----------------------------------------------------------------------------------------------------
TYPE OF ORGANIZATION: / / Trust / / Corporation / / Partnership / / Other type of Business
----------------
AUTHORIZED COMPANY
REP/TRUSTEE NAME:
--------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
B. TAXPAYER IDENTIFICATION NUMBER:
-----------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
C. ADDRESS: STREET OR PO BOX:
----------------------------------------------------------------------------
CITY, STATE, ZIP (Country if Other Than U.S.A.):
----------------------------------------------------------------------------
E-MAIL ADDRESS:
----------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
PREMIUM PAYER
- -----------------------------------------------------------------------------------------------------------------------------------
3. Select ONLY ONE: / / ISA (Omit A through D below) OR /X/ First Insured (Complete D only) / / Owner (Complete D only)
/ / Applicant (Complete D only) / / Other (Complete A, B, C and D)
A. / / Mr. / / Mrs. / / Ms. / / Dr. / / Other
--------------------------------
PERSONAL
NAME: / / MALE
--------------------------------------------------------------------------- / / FEMALE
(FIRST, MIDDLE INITIAL, LAST)
BIRTHDATE:
----------------------------
MONTH DAY YEAR
OR BUSINESS/TRUST
NAME:
------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
B. TAXPAYER IDENTIFICATION NUMBER: C. DAYTIME TELEPHONE NUMBER:
Area Code ( )
--------------------------------------------------- -----------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
Send premium and other notices regarding this policy to:
D. ADDRESS: /X/ First Insured's Address / / Applicant's Address OR
STREET OR PO BOX:
----------------------------------------------------------------------------
CITY, STATE, ZIP (Country if Other Than U.S.A.):
----------------------------------------------------------------------------
E-MAIL ADDRESS:
----------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
90-1 JCL (0198) 90-1934-50 (page 1)
<PAGE>
<TABLE>
<CAPTION>
<S><C>
- ------------------------------------------------------------------------------------------------------------------------
CAUTION: A MINOR OWNER CANNOT EXERCISE POLICY RIGHTS.
4. Select ONLY ONE: /X/ First Insured (Complete C only) / / Applicant (Complete C only)
/ / Other (Complete A, B and C) / / See attached supplement form
A. / / Mr. / / Mrs. / / Ms. / / Dr. / / Other
---------------------
PERSONAL / / MALE
NAME: / / FEMALE
----------------------------------------------------
(FIRST MIDDLE INITIAL LAST)
RELATIONSHIP TO INSURED: BIRTHDATE: | |
---------------------------------- ---------------------
OR BUSINESS/TRUST MONTH DAY YEAR
NAME:
----------------------------------------------------
RELATIONSHIP TO INSURED:
------------------------------------
- ------------------------------------------------------------------------------------------------------------------------
B. TAXPAYER IDENTIFICATION NUMBER:
--------------------------
- ------------------------------------------------------------------------------------------------------------------------
C. ADDRESS: /X/ First Insured's Address / / Applicant's Address / / Premium Payer's Address OR
STREET OR PO BOX:
-----------------------------------------------------------------
CITY, STATE, ZIP (Country if other than U.S.A.):
-----------------------------------------------------------------
E-MAIL ADDRESS:
-----------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------
5.-7. (Reserved)
SPECIAL DATE (COMPLETE THIS SECTION ONLY IF A SPECIAL POLICY DATE IS BEING REQUESTED)
- ------------------------------------------------------------------------------------------------------------------------
8. A. Prepaid: / / Short Term - Policy Date will coincide with ISA Payment Date (For monthly ISA only)
/ / Short Term to: | | / / Backdate to | |
--------------------- ---------------------
MONTH DAY YEAR MONTH DAY YEAR
B. Nonprepaid: / / Specified future date: | | / / Backdate to | |
--------------------- ---------------------
MONTH DAY YEAR MONTH DAY YEAR
- ------------------------------------------------------------------------------------------------------------------------
POLICY APPLIED FOR
- ------------------------------------------------------------------------------------------------------------------------
9. Joint Life Protection (See attached supplement)
10. If an additional benefit cannot be approved, should the company issue a policy without the benefit? / / Yes / / No
11. Shall the PREMIUM LOAN provision, if available, become operative according to its terms? /X/ Yes / / No
12.-13. (Reserved)
14. PREMIUM FREQUENCY: /X/ Annually / / Semiannually / / Quarterly
- ------------------------------------------------------------------------------------------------------------------------
BENEFICIARY
- ------------------------------------------------------------------------------------------------------------------------
15.A. DIRECT BENEFICIARY
First, Middle Initial, Last Relationship to Insured
(1) Mary J. Doe Daughter
----------------------------------------------------------------------------------- -----------------------
(2)
----------------------------------------------------------------------------------- -----------------------
(3)
----------------------------------------------------------------------------------- -----------------------
Business organization or trust
--------------------------------------------------------- -----------------------
---------------------------------------------------------
B. CONTINGENT BENEFICIARY:
First, Middle Initial, Last Relationship to Insured
(1)
----------------------------------------------------------------------------------- -----------------------
(2)
----------------------------------------------------------------------------------- -----------------------
(3)
----------------------------------------------------------------------------------- -----------------------
Box (1) or (2) may be selected to include all of the children or brothers and sisters without naming them, or to
add to the contingent beneficiaries named. Box (3) may be selected to provide for the children of a deceased
contingent beneficiary; use only if contigent beneficiaries are named and/or Box (1) or (2) is checked.
NOTE: The word "children" includes child and any legally adopted child.
/X/ (1) and all (other) children of the Insured.
/ / (2) and all (other) brothers and sisters of the Insured born of the marriage of or legally adopted
by and before the Insured's death.
-------------------------- -----------------------------
/ / (3) any amount that would have been paid to a deceased contingent beneficiary, if living, will be paid in one
sum and in equal shares to the children of that contingent beneficiary who survive and receive payment.
C. FURTHER PAYEES
First, Middle Initial, Last Relationship to Insured
(1)
----------------------------------------------------------------------------------- -----------------------
(2)
----------------------------------------------------------------------------------- -----------------------
D. / / SEE ATTACHED SUPPLEMENT FORM (To be used in place of designations above.)
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
90-1 JCL (0198) (page 2)
<PAGE>
<TABLE>
<CAPTION>
<S><C>
16. (Reserved)
CONDITIONAL LIFE INSURANCE AGREEMENT
- ---------------------------------------------------------------------------------------------------------------------------------
17. Has the premium for the policy applied for been given to the agent in exchange for the Conditional
Life Insurance Agreement with the same number as this application? /X/ Yes / / No
- ---------------------------------------------------------------------------------------------------------------------------------
INSURANCE HISTORY
- ---------------------------------------------------------------------------------------------------------------------------------
18. Has the Insured ever had life, disability or health insurance declined, rated, modified, issued with
an exclusion rider, cancelled, or not renewed? If yes, explain in REMARKS. / / Yes /X/ No
19. When was the Insured's last examination or application for life, disability or accidental death
insurance?
Month Year Company OR /X/ None
----------------------- ------------------------ ------------------------------
20. Does the Insured have any other life insurance in force, pending or contemplated in other companies? / / Yes /X/ No
If yes, indicate Company Name, Individual (Ind) or Group (Grp) and indentify the amount of in Force,
Pending, or Contemplated.
LIFE INSURANCE AMOUNTS
------------------------------------------------------------------------------------------------------------------------
Company Name Ind/Grp In Force Pending Contemplated Accidental
Amount Amount Amount Death Amount
------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------
21. As a result of this purchase will the values or benefits of any other life insurance policy or
annuity contract, on any life, be affected in any way? / / Yes /X/ No
NOTE TO AGENT: VALUE OR BENEFITS ARE AFFECTED IF ANY QUESTION ON THE
DEFINITION OF REPLACEMENT SUPPLEMENT COULD BE ANSWERED "YES".
If "yes", this transaction is a replacement of life insurance or annuity.
The agent must:
- submit required papers and sale materials AND
- provide required disclosure notices to the applicant.
The applicant must answer the questions:
- on the Definition of Replacement Supplement AND
- A, B, and C below.
Will this insurance:
A. replace Northwestern Mutual Life? / / Yes /X/ No
B. replace other Companies? / / Yes /X/ No
C. result in 1035 exchange? / / Yes /X/ No
- ---------------------------------------------------------------------------------------------------------------------------------
22. (Reserved)
REMARKS
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
90-1 JCL (0198) (page 3)
<PAGE>
<TABLE>
<CAPTION>
<S><C>
John J Doe
------------------------------------------------------------
FIRST MIDDLE INITIAL LAST
PERSONAL HISTORY QUESTIONNAIRE - FIRST INSURED
- ----------------------------------------------------------------------------------------------------------------------------------
23. Insured's Marital Status: / / Single, Widowed or Divorced /X/ Married
24. a. Insured is a citizen of: /X/ U.S.A. / / Other
If other: Type of Visa: Visa Number:
------------------------- ----------------
b. How many years has the Insured resided in the U.S.A. immediately prior to completing
this application? 35 years
-----
25. Does the Insured regularly travel outside the U.S.A. or have plans to leave the U.S.A. for travel
or residence?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ./ /Yes /X/ No
If yes, explain in the chart below.
-------------------------------------------------------------------------------------------------------------------------
Destination Number of Trips Duration of Departure Date Purpose of Trip
(List all Cities and Countries) Last 12 Next 12 Each Trip (Month/Year)
Months Months (No. of Days)
-------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------
26. a. What is the Insured's occupation(s)? Attorney
----------------------------------------------------------------------------------
What are the Insured's duties? Office Duties
----------------------------------------------------------------------------------------
b. Employer's Name: ABC Corporation
------------------------------------------------------------------------------------------------------
Address: 1000 Company Ave.
------------------------------------------------------------------------------------------------------
City, State, Zip Code: Milwaukee, WI 53200
-----------------------------------------------------------------------------------------------
c. How long has the insured been employed? 7 years (If less than 2 years, explain in REMARKS)
---------
QUESTIONS 27 THROUGH 30 ARE NOT REQUIRED IF THE INSURED IS UNDER AGE 16.
27. Is the Insured a memeber of, or does the Insured plan on joining any branch of, the Armed Forces
or reserve military unit? If yes, complete the Military Section. . . . . . . . . . . . . . . . . . . . . . ./ / Yes /X/ No
28. Except as a passenger on a regularly scheduled flight, has the Insured flown within the past 2
years, or does the Insured have plans to fly in the future? If yes, complete the Aviation Section. . . . . ./ / Yes /X/ No
29. In the past 2 years, has the Insured participated in or does the Insured have plans to participate
in: racing (automobile, snowmobile, motorcycle, boat or go-cart), underwater or sky diving, hang
gliding, bungee jumping, mountain or rock climbing, or rodeos? If yes, complete the Avocation Section. . . ./ / Yes /X/ No
30. a. What is the Insured's automobile driver's license number? # D555-5555-555-55 State WI
or, / / the Insured does not have a driver's license. ------------------ ----------
b. In the past 5 years, has the Insured been in a motor vehicle accident, has the Insured been
charged with a moving violation of any motor vehicle law, or has the Insured's driver's
license been restricted, suspended or revoked?
If yes, complete the chart below. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ./ / Yes /X/ No
-------------------------------------------------------------------------------------------------------------------------
Type and Details Action Accident
Date (Speeding, Reckless Driving, Driving While Intoxicated, Etc.) (Citation, Fine, Etc.) (Yes or No)
-------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
REMARKS
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
90-1 JCL (0198) (page 4)
<PAGE>
<TABLE>
<CAPTION>
<S><C>
APPLICATION INFORMATION FOR SECOND INSURED
-------------------------
POLICY NUMBER
SECOND INSURED (OLDER) / / Companion policies / / Life & Disability Application / / LTC Application / / Exam (NM, PME, MD) in Home
Office
ON PAGES 5 AND 6, "INSURED" REFERS TO THE SECOND INSURED.
- ----------------------------------------------------------------------------------------------------------------------------------
Has an application or informal inquiry ever been made to Northwestern Mutual Life for annuity, life, long term care, or disability
insurance on the life of the Insured? / / Yes /X/ No If yes, the last policy number is
------------------------------------
1. A. / /Mr. /X/ Mrs. / /Ms. / /Dr. / /Other B. / / MALE
------------------------ /X/ FEMALE
NAME: JANE J DOE
-----------------------------------------------------------------------
FIRST MIDDLE INITIAL LAST
- ----------------------------------------------------------------------------------------------------------------------------------
C. BIRTHDATE: (MONTH, DAY, YEAR) D. STATE OF BIRTH (or Foreign Country): E. TAXPAYER IDENTIFICATION NUMBER:
1 2 3 1 1 9 6 3 Wisconsin ###-##-####
------------------ -----------
- ----------------------------------------------------------------------------------------------------------------------------------
F. PRIMARY RESIDENCE: /X/ First Insured's Address OR
STREET OR PO BOX:
---------------------------------------------------------------------------
CITY, STATE, ZIP (Country if other than U.S.A.):
---------------------------------------------------------------------------
E-MAIL ADDRESS:
---------------------------------------------------------------------------
This address will be used for all of the Second Insured's policies.
- ----------------------------------------------------------------------------------------------------------------------------------
2.-9. (Reserved)
- ----------------------------------------------------------------------------------------------------------------------------------
10. If an additional benefit cannot be approved should the Company issue the policy without the benefit? / / Yes / / No
- ----------------------------------------------------------------------------------------------------------------------------------
11.-17. (Reserved)
INSURANCE HISTORY
- ----------------------------------------------------------------------------------------------------------------------------------
18. Has the Insured ever had life, disability or health insurance declined, rated, modified, issued with an
exclusion rider, cancelled, or not renewed? If yes, explain in REMARKS. / /Yes /X/ No
19. When was the Insured's last examination or application for life, disability or accidental death insurance?
Month Year Company OR /X/ NONE
------------ -------- ------------------------------------------------
20. Does the Insured have any other life insurance in force, pending or contemplated in other companies?
If yes, indicate Company Name, Individual (Ind) or Group (Grp) and identify the amount of in Force,
Pending, or Contemplated. / / Yes /X/ No
LIFE INSURANCE AMOUNTS
-------------------------------------------------------------------------------------------------------------------------------
Company Name Ind/Grp In Force Pending Contemplated Accidental
Amount Amount Amount Death Amount
-------------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------------
21. As a result of this purchase will the values or benefits of any other life insurance policy or annuity
contract, on any life, be affected in any way? / / Yes /X/ No
NOTE TO AGENT: VALUES OR BENEFITS ARE AFFECTED IF ANY QUESTION ON THE
DEFINITION OF REPLACEMENT SUPPLEMENT COULD BE ANSWERED "YES".
If "yes", this transaction is a replacement of life insurance or annuity.
The agent must:
- submit required papers and sale materials AND
- provide required disclosure notices to the applicant.
The applicant must answer the questions:
- on the Definition of Replacement Supplement AND
- A, B, and C below.
Will this insurance:
A. replace Northwestern Mutual Life? / / Yes /X/ No
B. replace other Companies? / / Yes /X/ No
C. result in 1035 exchange? / / Yes /X/ No
- ----------------------------------------------------------------------------------------------------------------------------------
22. (Reserved)
REMARKS
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
90-1 JCL (0198) (page 5)
<PAGE>
<TABLE>
<CAPTION>
<S><C>
- ----------------------------------------------------------------------------------------------------------------------------------
23. Insured's Marital Status: / / Single, Widowed or Divorced /X/ Married
24. a. Insured is a citizen of: /X/ U.S.A. / / Other
If other: Type of Visa: Visa Number:
------------------- ----------------
b. How many years has the insured resided in the U.S.A. immediately prior to completeing
this application? 35 years
--------
25. Does the insured regularly travel outside the U.S.A. or have plans to leave the U.S.A. for
travel or residence? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ./ /Yes /X/ No
If yes, explain in the chart below.
-------------------------------------------------------------------------------------------------------------------------
Destination Number of Trips Duration of Departure Date Pupose of Trip
(List all Cities and Countries) Last 12 Next 12 Each Trip (Month/Year)
Months Months (No. of Days)
-------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------
26. a. What is the Insured's occupation(s)? Housewife
---------------------------------------------------------------------------------
What are the Insured's duties?
---------------------------------------------------------------------------------------
b. Employer's Name:
-----------------------------------------------------------------------------------------------------
Address:
------------------------------------------------------------------------------------------------------
City, State, Zip Code:
-----------------------------------------------------------------------------------------------
c. How long has the insured been employed? years (If less than 2
years, explain in REMARKS) ---------------
QUESTIONS 27 THROUGH 30 ARE NOT REQUIRED IF THE INSURED IS UNDER AGE 16.
27. Is the Insured a memeber of, or does the Insured plan on joining any branch of, the Armed
Forces or reserve military unit? If yes, complete the Military Section . . . . . . . . . . . . . . . . . . ./ / Yes /X/ No
28. Except as a passenger on a regularly scheduled flight, has the Insured flown within the
past 2 years, or does the Insured have plans to fly in the future? If yes, complete the
Aviation Section . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ./ / Yes /X/ No
29. In the past 2 years, has the Insured participated in or does the Insured have plans to
participate in: racing (automobile, snowmobile, motorcycle, boat or go-cart), underwater
or sky diving, hang gliding, bungee jumping, mountain or rock climbing, or rodeos? If yes,
complete the Avocation Section. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ./ / Yes /X/ No
30. a. What is the Insured's automobile driver's license number? # D333-3333-3333-33 State WI
or, / / the Insured does not have a driver's license. ----------------- --------------
b. In the past 5 years, has the Insured been in a motor vehicle accident, has the Insured
been charged with a moving violation of any motor vehicle law, or has the Insured's
driver's license been restricted, suspended or revoked?
If yes, complete the chart below . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ./ / Yes /X/ No
-------------------------------------------------------------------------------------------------------------------------
Type and Details Action Accident
Date (Speeding, Reckless Driving, Driving While Intoxicated, Etc.) (Citation, Fine, Etc.) (Yes or No)
-------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
REMARKS
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
90-1 JCL (0198) (page 6)
<PAGE>
- -------------------------------------------------------------------------------
EACH INSURED CONSENTS TO THIS APPLICATION AND ATTACHED SUPPLEMENTS AND DECLARES
THAT THE ANSWERS AND STATEMENTS MADE ON THIS APPLICATION AND ATTACHED
SUPPLEMENTS ARE CORRECTLY RECORDED, COMPLETE AND TRUE TO THE BEST OF EACH
INSURED'S KNOWLEDGE AND BELIEF. ANSWERS AND STATEMENTS BROUGHT TO THE
ATTENTION OF THE AGENT, MEDICAL EXAMINER OR PARAMEDICAL EXAMINER ARE NOT
CONSIDERED INFORMATION BROUGHT TO THE ATTENTION OF THE COMPANY UNLESS STATED
IN THE APPLICATION. STATEMENTS IN THIS APPLICATION ARE REPRESENTATIONS AND
NOT WARRANTIES.
It is agreed that:
(1) If the premium is not paid when the application is signed, no insurance
will be in effect. The insurance will take effect at the time the policy
is delivered and the premium is paid, if: both Insureds are living at that
time; and the answers and statements in the application are then true to
the best of each Insured's knowledge and belief.
(2) If the premium is paid when the application is taken, no insurance will
be in effect except as provided in the Conditional Life Insurance
Agreement with the same number as this application.
(3) No agent is authorized to make or alter contracts or to waive any of the
Company's rights or requirements.
-----------------------------------------------------------------------------
THE OWNER OF THE POLICY APPLIED FOR HEREIN CERTIFIES, UNDER PENALTIES OF
PERJURY, (1) THAT THE TAXPAYER IDENTIFICATION NUMBER GIVEN FOR THE OWNER ON
THE SECOND PAGE OF THIS APPLICATION IS THE OWNER'S CORRECT TAXPAYER
IDENTIFICATION NUMBER (OR THE OWNER IS WAITING FOR A NUMBER TO BE ISSUED) AND
(2) THE OWNER IS NOT SUBJECT TO BACKUP WITHHOLDING EITHER BECAUSE THE OWNER
HAS NOT BEEN NOTIFIED BY THE INTERNAL REVENUE SERVICE (IRS) THAT THE OWNER IS
SUBJECT TO BACKUP WITHHOLDING AS A RESULT OF A FAILURE TO REPORT ALL INTEREST
OR DIVIDENDS, OR THE IRS HAS NOTIFIED THE OWNER THAT THE OWNER IS NO LONGER
SUBJECT TO BACKUP WITHHOLDING. (SEE TAXPAYER IDENTIFICATION NUMBER
INSTRUCTIONS.)
THE INTERNAL REVENUE SERVICE DOES NOT REQUIRE YOUR CONSENT TO ANY PROVISION
OF THIS DOCUMENT OTHER THAN THE CERTIFICATIONS REQUIRED TO AVOID BACKUP
WITHHOLDING.
-----------------------------------------------------------------------------
THE SIGNATURES BELOW APPLY TO THE APPLICATION, THE POLICY APPLICATION
SUPPLEMENT AND THE CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER.
<TABLE>
<CAPTION>
<S> <C>
(Signed) John J. Doe (Signed) Jane J. Doe
- -------------------------------------- -----------------------------------------
Signature of FIRST INSURED Signature of SECOND INSURED
(Signed) John J. Doe
- -------------------------------------- -----------------------------------------
Signature of APPLICANT Signature of OWNER (If other than
Applicant, First or Second Insured)
Signed by APPLICANT at Milwaukee, Milwaukee WI Date signed by APPLICANT 12 | 31 | 1998
------------------------ ----------------
CITY, COUNTY & STATE MONTH DAY YEAR
(Signed) Norm W. Western
------------------------------
Signature of LICENSED AGENT
</TABLE>
- --------------------------------------------------------------------------------
INSTRUCTIONS FOR TAXPAYER IDENTIFICATION NUMBER INFORMATION
1. Under federal income tax law you will be subject to a withholding tax of
31% imposed upon certain reportable payments, if any, and to certain
penalities if you do not certify under penalties of perjury that the
Taxpayer Identification Number which you have provided us is correct and
that you are not subject to backup withholding due to notified payee
underreporting. Generally speaking, for individuals, the Taxpayer
Identification Number is the Social Security Number.
2. If you don't have a Taxpayer Identification Number, obtain Form SS-5,
Application for a Social Security Number Card, at the local office of the
Social Security Administration or the Internal Revenue Service and apply for
a number. Write "Applied for" in the space available for your Taxpayer
Identification Number on the first page of this application. If we do not
receive your Taxpayer Identification Number within 60 days, we are required
to withhold 31% of all reportable payments, if any, thereafter made to you
until we receive such a number from you.
3. If the Internal Revenue Service has notified you that you are subject to
backup withholding and you have not received notice from the Service that
backup withholding has terminated, you should strike out the language on
page 9 that you are not subject to backup withholding due to notified payee
underreporting.
90-1 JCL (0198) (page 7)
<PAGE>
POLICY APPLICATION SUPPLEMENT FOR
FLEXIBLE PREMIUM VARIABLE JOINT LIFE INSURANCE POLICY
INSURANCE PAYABLE ON SECOND DEATH
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
720 East Wisconsin Avenue
Milwaukee, Wisconsin 53202
INSUREDS: John J. Doe and Jane J. Doe
-------------------- ----------------------
POLICY:
Specified Amount: $ 1,000,000
--------------------------------------------
Death Benefit Option: Specified Amount (Option A)
--------------------------------------------
Definition of Life Insurance Test: Guideline Premium/Cash Value Corridor Test
--------------------------------------------
Minimum Initial Premium: $ 5,000
--------------------------------------------
Guideline Premium Maximum: $ 8,960
--------------------------------------------
Reminder Premium: $ 5,000
--------------------------------------------
Reminder Mode: Annual
--------------------------------------------
- --------------------------------------------------------------------------------
For Home Office Use Only
Underwriting Amount: $ 1,000,000
-----------
Illustrated Cumulative Premiums:
Years 1- 5: $ 25,000 Years 1- 15: $ 75,000
---------- -----------
Years 1- 10: $ 50,000 Years 1- 20: $ 100,000
---------- -----------
First Insured: 35, Male, Select Second Insured: 35 Female Select
------------------------- --------------------
WI
- -------
- --------------------------------------------------------------------------------
Illustration No. 123-456-789
90-1 VJL. Supp. (1298) Page 1 of 4 -----------
<PAGE>
ALLOCATION OF NET PREMIUMS
This allocation will apply to all net premiums and loan repayments. USE WHOLE
PERCENTAGES ONLY. If monthly dollar cost averaging is desired, complete both
this section and the monthly dollar cost averaging section below. Only
allocations to the Money Market Division are utilized for dollar cost averaging
purposes.
Money Market Division %
----------
Aggressive Growth Stock Division %
----------
Balanced Division %
----------
Growth and Income Stock Division %
----------
Growth Stock Division %
----------
High Yield Bond Division %
----------
Index 500 Stock Division %
----------
International Equity Division %
----------
Select Bond Division %
----------
Total 100 %
----------
MONTHLY DOLLAR COST AVERAGING
To elect monthly dollar cost averaging, choose one of the following options and
indicate the desired allocation of transfers below. USE WHOLE PERCENTAGES ONLY.
_____Option One: Transfer in monthly installments so that on the policy
anniversary the Money Market balance will be zero.
_____Option Two: Transfer a level amount of $______________until the Money
Market balance is zero.
Aggressive Growth Stock Division %
----------
Balanced Division %
----------
Growth and Income Stock Division %
----------
Growth Stock Division %
----------
High Yield Bond Division %
----------
Index 500 Stock Division %
----------
International Equity Division %
----------
Select Bond Division %
----------
Total 100 %
----------
Insureds: John J. Doe and
----------------
Jane J. Doe
----------------
Illustration No. 123-456-789
-------------------
90-1 VJL. Supp. (1298) Page 2 of 4
<PAGE>
SUITABILITY
Northwestern Mutual Life is required to make the following inquiries for
purposes of determining the suitability of this purchase. Responses will be kept
confidential.
1. In addition to providing a death benefit upon the death of the second of the
Insureds, what is the purpose for the purchase?
To fund a trust. Purpose of the trust:
- ----- ------------------------------------
To supplement retirement income
- -----
To supplement education funding
- -----
Other (specify):
- ----- ----------------------------------------------------------
2. By whom will the purchase be funded?
-----------------------------------------
Annual income (all sources) of person/trust funding the purchase: $
--------
Net worth of person/trust funding the purchase: $
--------------------------
3. Applicant's experience with the following:
(If the purpose for the purchase is to fund a trust, describe the trust's or
trustee's experience)
None Up to 5 or More
5 Years Than 5 Years
Mutual Funds
------ ------ ------
Individual Common Stocks
------ ------ ------
Bonds
------ ------ ------
Variable Annuities
------ ------ ------
Variable Life Insurance
------ ------ ------
4. Describe the information the applicant has provided regarding his/her
portfolio, tax status and variable life insurance purchase objectives and needs
(if the purpose for the purchase is to fund a trust, describe the information
the trust has provided regarding its portfolio, tax status and variable life
insurance purchase objectives and needs):
Insureds: John J. Doe and
----------------
Jane J. Doe
----------------
Illustration No. 123-456-789
-------------------
90-1 VJL. Supp. (1298) Page 3 of 4
<PAGE>
I UNDERSTAND THAT THE DEATH BENEFIT FOR A FLEXIBLE PREMIUM VARIABLE JOINT LIFE
POLICY IS VARIABLE AND MAY INCREASE OR DECREASE TO REFLECT THE INVESTMENT
EXPERIENCE OF NORTHWESTERN MUTUAL VARIABLE LIFE ACCOUNT. THE AMOUNT OF THE DEATH
BENEFIT IS NOT GUARANTEED.
I UNDERSTAND THAT THE CASH VALUE FOR A FLEXIBLE PREMIUM VARIABLE JOINT LIFE
POLICY IS VARIABLE AND MAY INCREASE OR DECREASE TO REFLECT THE INVESTMENT
EXPERIENCE OF NORTHWESTERN MUTUAL VARIABLE LIFE ACCOUNT. THE AMOUNT OF THE CASH
VALUE IS NOT GUARANTEED.
I understand that any illustrations of death benefits and cash values I have
been shown demonstrate how the policy operates under a given set of assumptions
and are not estimates or guarantees of future results. Actual experience will be
different than assumed, resulting in death benefits and cash values higher or
lower than illustrated. The assumptions incorporated in an illustration include,
but are not limited to, the following: premium payment amounts and frequencies,
investment returns, expense charges, cost of insurance charges, loans, and
withdrawals.
I acknowledge receipt of the _____/_____/_____ Flexible Premium Variable
MO. DAY YR.
Joint Life Insurance Policy prospectus.
DATE: 12 / 31 / 98 SIGNATURE OF APPLICANT: (Signed) John J. Doe
---- ---- ---- ---------------------------
MO. DAY YR.
Based on the information furnished by the Applicant in this application, I
certify that I have reasonable grounds for believing the purchase of the policy
applied for is suitable for the Applicant. I further certify that a current
prospectus was delivered and that no written sales materials other than those
furnished by the Northwestern Mutual Life home office were used.
Signature of Licensed Agent: (Signed) Norm W. Western
----------------------------------------------------
(REGISTERED REPRESENTATIVE)
Based on the information furnished by the applicant in this application, I
certify that I have reasonable grounds for believing the purchase of the policy
applied for is suitable for the Applicant.
Signature of General Agent: (Signed) Norma W. Western
-----------------------------------------------------
Insureds: John J. Doe and
----------------
Jane J. Doe
----------------
Illustration No. 123-456-789
-------------------
90-1 VJL. Supp. (1298) Page 4 of 4
<PAGE>
IT IS RECOMMENDED THAT YOU ...
read your policy.
notify your Northwestern Mutual agent or the Company at 720 East Wisconsin
Avenue, Milwaukee, WI 53202, of an address change.
call your Northwestern Mutual agent for information--particularly on a
suggestion to terminate or exchange this policy for another policy or plan.
ELECTION OF TRUSTEES
The members of The Northwestern Mutual Life Insurance Company are its
policyholders of insurance policies and deferred annuity contracts. The members
exercise control through a Board of Trustees. Elections to the Board are held
each year at the annual meeting of members. Members are entitled to vote in
person or by proxy.
FLEXIBLE PREMIUM VARIABLE JOINT LIFE INSURANCE POLICY
INSURANCE PAYABLE ON SECOND DEATH
ELIGIBLE FOR ANNUAL DIVIDENDS
Flexible premiums.
Benefits reflect investment results.
Variable benefits described in Sections 1, 3, 6, 7 and 8.
THE DEATH BENEFIT AND CASH VALUE UNDER THIS POLICY ARE VARIABLE. THEY MAY
INCREASE OR DECREASE DAILY DEPENDING ON THE INVESTMENT RESULTS OF THE SEPARATE
ACCOUNT. THE AMOUNT OF THE DEATH BENEFIT AND THE AMOUNT OF THE CASH VALUE ARE
NOT GUARANTEED.
RR.VJL.(1298)
<PAGE>
POLICY SPLIT PROVISION
POLICY SPLIT RIGHT. While both Insureds are alive, the Owner may exchange this
policy for two policies (the "new policies"), one on the life of each Insured,
if there is a change in federal estate tax law which results in either:
a. the repeal of the unlimited marital deduction provision; or
b. at least a 50% reduction in the maximum percentage rate set forth in
the federal estate tax schedule in effect on the Date of Issue of this
policy.
This exchange may be made without evidence of insurability.
CONDITIONS. The exchange may be made by meeting any conditions set by the
Company, including the following:
a. the Company must receive a written request from the Owner no more than
180 days after the earlier of the date of enactment of the law
repealing the unlimited marital deduction or the date of enactment of
the law reducing the maximum percentage rate of federal estate tax by
50%; and
b. any required costs are paid.
TERMS OF THE NEW POLICIES. The new policies will be issued on any life
insurance plan agreed to by the Owner and the Company. The new policies will
have the same Date of Issue and Policy Date as this policy. The new policies
will take effect on the date the written request to exchange this policy for the
new policies is received at the Home Office. This policy will terminate when
the new policies take effect.
The amount of the death benefit of each new policy will be one-half the
amount of the death benefit of this policy. The Policy Value of this policy
will be allocated to each new policy as determined appropriate by the Company.
Any policy debt will be divided between the new policies in proportion to their
cash values. Any assignment will continue on the new policies.
SECRETARY
THE NORTHWESTERN
MUTUAL LIFE
INSURANCE COMPANY
RR.VJL.PS.(1298)
HOL03 105426
<PAGE>
Exhibit A(5)(b)
The Northwestern Mutual Life Insurance Company agrees to pay the benefits
provided in this policy,subject to its terms and conditions.
Signed at Milwaukee, Wisconsin on the Date of Issue.
FLEXIBLE PREMIUM VARIABLE JOINT LIFE INSURANCE POLICY
INSURANCE PAYABLE ON SECOND DEATH
Eligible for Annual Dividends
Flexible premiums.
Benefits reflect investment results.
Variable benefits described in Sections 1, 3, 6, 7 and 8.
THE DEATH BENEFIT AND CASH VALUE UNDER THIS POLICY ARE VARIABLE. THEY MAY
INCREASE OR DECREASE DAILY DEPENDING ON THE INVESTMENT RESULTS OF THE SEPARATE
ACCOUNT. THE AMOUNT OF THE DEATH BENEFIT AND THE AMOUNT OF THE CASH VALUE ARE
NOT GUARANTEED.
RIGHT TO RETURN POLICY. Please read this policy carefully. The policy may be
returned by the Owner for any reason within ten days after it was received. The
policy may be returned to your agent or to the Home Office of the Company at 720
East Wisconsin Avenue, Milwaukee, WI 53202. If returned, the policy will be
considered void from the beginning. The Company will refund the sum of (a) the
difference between any premium paid and the amount allocated to the Separate
Account plus (b) the value of the policy in the Separate Account on the date the
returned policy is received.
<TABLE>
<S> <C> <C> <C>
INSURED John J. Doe AGE AND SEX 35 Male
Jane J. Doe 35 Female
POLICY DATE December 31, 1998 POLICY NUMBER 10 000 000
PLAN Flexible Premium Variable SPECIFIED AMOUNT $1,000,000.00 Joint Life Insurance
</TABLE>
RR.VJL.(1298)
<PAGE>
THIS POLICY IS A LEGAL CONTRACT BETWEEN THE OWNER AND
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY.
READ YOUR POLICY CAREFULLY.
GUIDE TO POLICY PROVISIONS
BENEFITS AND PREMIUMS
SECTION 1. THE CONTRACT
Life Insurance Benefit payable on second death. Incontestability.
Suicide. Definition of dates. Reports to Owner.
SECTION 2. OWNERSHIP
Rights of the Owner. Assignment as collateral.
SECTION 3. DEATH BENEFIT
Description of death benefit options. Changes to death benefits.
SECTION 4. PREMIUMS, TRANSFERS AND REINSTATEMENT
Payment of premiums. Calculation and allocation of net premiums.
Transfer of assets. Premium limitations. Grace period of 61 days to
pay premium. How to reinstate the policy.
SECTION 5. DIVIDENDS
Annual dividends. Use of dividends. Dividend at death.
SECTION 6. THE SEPARATE ACCOUNT
The Separate Account and the Divisions. Valuation of assets.
SECTION 7. DETERMINATION OF VALUES
Policy Value. Monthly Policy Charge.
SECTION 8. CASH VALUE AND SURRENDER
Cash value. Surrender. Deferral of payments.
SECTION 9. LOANS AND WITHDRAWALS
Policy loans. Interest on loans. Withdrawals.
SECTION 10. BENEFICIARIES
Naming and change of beneficiaries. Succession in interest of
beneficiaries.
ADDITIONAL BENEFITS (if any)
APPLICATION
RR.VJL.(1298)
BENEFITS AND PREMIUMS
DATE OF ISSUE - DECEMBER 31, 1998
Plan: Flexible Premium Variable Joint Life Insurance
Specified Amount: $1,000,000.00
Death Benefit Option: Specified Amount (Option A)
Definition of Life Insurance Test: Guideline Premium/Cash Value Corridor Test
The Age 100 Date (Section 3) is December 31, 2063.
The Final Premium Date (Section 4) is December 30, 2058.
<PAGE>
The minimum premium (Section 4.4) is $25.00.
The maximum premium under the Guideline Premium/Cash Value Corridor Test:
Guideline Single Premium = $ 87,370.00
Guideline Annual Level Premium = $ 8,960.00
The minimum withdrawal amount (Section 9.5) is $250.00.
This policy is issued in a select (nonsmoker) rate class on John J. Doe and
in a select (nonsmoker) rate class on Jane J. Doe.
DIRECT BENEFICIARY JANE M. DOE, DAUGHTER OF THE INSURED
OWNER JOHN J. DOE, THE INSURED
<TABLE>
<S> <C> <C> <C>
INSURED John J. Doe AGE AND SEX 35 Male
Jane J. Doe 35 Female
POLICY DATE December 31, 1998 POLICY NUMBER 10 000 000
PLAN Flexible Premium Variable SPECIFIED AMOUNT $1,000,000.00 Joint Life Insurance
</TABLE>
RR.VJL.(1298) Page 3
<PAGE>
POLICY NUMBER 10 000 000
SCHEDULE OF CHARGES
The Premium Expense Charge (Section 4.2) is the sum of the following:
1. Sales Load:
<TABLE>
<CAPTION>
Policy Years 1 Policy Years
Premium Paid - 10 after 10
------------ ---------------------------------
<S> <C> <C>
Up to $ $7,120.00 6.4% 2.4%
In Excess of $ 7,120.00 2.4% 2.4%
</TABLE>
2. Federal Deferred Acquisition Cost Charge l.25% of premium
3. Premium Tax Charge 2.35% of premium
The Premium Expense Charge for Federal Deferred Acquisition Cost
and Premium Tax may change to reflect changes in tax law.
Monthly Policy Charge (Section 7.2):
The maximum monthly Administrative Charge is $7.50.
The maximum monthly Underwriting and Issue Charge is $15.00. There is no
charge after the tenth policy year.
The maximum monthly Mortality and Expense Risk Charge during the first ten
policy years is the sum of .075% of Policy Value less policy debt, plus
$11.67. The maximum monthly Mortality and Expense Risk Charge after the
first ten policy years is .075% of Policy Value less policy debt.
The maximum monthly Deferred Sales Charge is $44.50. There is no charge
after the tenth policy year.
RR.VJL.(1298) Page 4
<PAGE>
POLICY NUMBER 10 000 000
SCHEDULE OF CHARGES (continued)
Maximum Transaction Charges:
The maximum charge for death benefit option changes (Section 3.2) is
$250.00 per change.
The maximum charge for Specified Amount changes (Section 3.3) is $25.00 per
change for more than one change during any policy year.
The maximum transfer fee (Section 4.3) is $25.00 per transfer for more than
12 transfers during any policy year.
The maximum withdrawal charge (Section 9.5) is $25.00 per withdrawal.
Surrender Charge (Section 8.3):
The surrender charge percentage is 50% during the first policy year; this
percentage is decreased by 0.462963% on each monthly processing date during
the second through tenth policy years.
The maximum surrender charge is $3,560.00 during the first policy year;
this charge is decreased by $32.96 on each monthly processing date during
the second through tenth policy years.
There is no surrender charge after the tenth policy year.
RR.VJL.(1298) Page 5
<PAGE>
POLICY NUMBER 10 000 000
TABLE OF GUARANTEED MAXIMUM COST OF INSURANCE RATES
MONTHLY RATES PER $1,000.00
(Section 7.3)
<TABLE>
<CAPTION>
Policy Monthly Rate Policy Monthly Rate Policy Monthly Rate
Year Year Year
<S> <C> <C> <C> <C> <C>
1 .00021 26 .16877 51 9.14987
2 .00067 27 .19882 52 10.36448
3 .00121 28 .23560 53 11.65487
4 .00186 29 .28104 54 13.00037
5 .00266 30 .33649 55 14.41268
6 .00360 31 .40202 56 15.89204
7 .00476 32 .47841 57 17.45991
8 .00613 33 .56575 58 19.15688
9 .00775 34 .66447 59 21.05478
10 .00962 35 .77774 60 23.36818
11 .01184 36 .91157 61 26.51705
12 .01443 37 1.08075 62 31.35472
13 .01748 38 1.26820 63 39.59522
14 .02104 39 1.50766 64 54.65267
15 .02522 40 1.79530 65 83.33333
16 .03014 41 2.13054 After 65 .00000
17 .03602 42 2.51400
18 .04311 43 2.94442
19 .05167 44 3.42118
20 .06184 45 3.95359
21 .07386 46 4.55879
22 .08791 47 5.25323
23 .10398 48 6.05601
24 .12221 49 6.98106
25 .14352 50 8.01516
</TABLE>
The monthly rates shown above are based on the appropriate Commissioners 1980
Standard Ordinary Smoker and/or Nonsmoker Mortality Table for the sex and class
of the Insureds.
RR.VJL.(1298) Page 6
<PAGE>
POLICY NUMBER 10 000 000
GUIDELINE PREMIUM/CASH VALUE CORRIDOR PERCENTAGES
The Corridor Percentages are used to determine the Minimum Death Benefit under
the Guideline Premium/Cash Value Corridor Test (Section 3.1).
<TABLE>
<CAPTION>
Policy Policy Policy
Year Corridor % Year Corridor % Year Corridor %
<S> <C> <C> <C> <C> <C>
1 250 26 130 51 105
2 250 27 128 52 105
3 250 28 126 53 105
4 250 29 124 54 105
5 250 30 122 55 105
6 250 31 120 56 105
7 243 32 119 57 104
8 236 33 118 58 103
9 229 34 117 59 102
10 222 35 116 60 101
11 215 36 115 After 60 100
12 209 37 113
13 203 38 111
14 197 39 109
15 191 40 107
16 185 41 105
17 178 42 105
18 171 43 105
19 164 44 105
20 157 45 105
21 150 46 105
22 146 47 105
23 142 48 105
24 138 49 105
25 134 50 105
</TABLE>
RR.VJL.(1298) Page 7
<PAGE>
POLICY NUMBER 10 000 000
SEPARATE ACCOUNT DIVISIONS
(Section 6)
Money Market Division
Select Bond Division
High Yield Bond Division
Balanced Division
Index 500 Stock Division
Growth & Income Stock Division
Growth Stock Division
International Equity Division
Aggressive Growth Stock Division
The Initial Allocation Date is January 15, 1999.
RR.VJL.(1298) Page 8
<PAGE>
SECTION 1. THE CONTRACT
1.1 LIFE INSURANCE BENEFIT
The Northwestern Mutual Life Insurance Company will pay a benefit on the
death of the second of the Insureds to die (the "second death") while this
policy is in force. No benefit is payable on the death of the first of the
Insureds to die. Subject to the terms and conditions of the policy:
- payment of the death proceeds will be made after proof of the deaths
of both Insureds is received at the Home Office; and
- payment will be made to the beneficiary or other payee under Section
10.
The amount of the death proceeds will be:
- the death benefit (Section 3.1); less
- the amount of any policy debt (Section 9.3); less
- any Monthly Policy Charges due and unpaid if the second death occurs
during the grace period (Section 4.5).
These amounts will be determined as of the date of the second death.
The Company will pay interest on the death proceeds from the date of the
second death until the proceeds are paid. Interest will be at an annual
effective rate of not less than 2%, or at any higher rate required by state law.
1.2 NOTICE AND PROOF OF DEATH
Written notice and proof of the death of each Insured must be given to the
Company as soon as reasonably possible after each death.
RR.VJL.(1298) 9
<PAGE>
1.3 ENTIRE CONTRACT; CHANGES
This policy, including the attached application and any amendments,
endorsements or riders, is the entire contract. Statements in the application
are representations and not warranties. A change in the policy is valid only if
it is approved in writing by an officer of the Company. The Company may require
that the policy be sent to it for endorsement to show a change. No agent has
the authority to change the policy or to waive any of its terms.
1.4 INCONTESTABILITY
In issuing the insurance, the Company has relied on the application. While
the insurance is contestable, the Company, on the basis of a material
misstatement in the application, may rescind the insurance or deny a claim.
The Company will not contest insurance under this policy after that
insurance has been in force, during the lifetime of at least one Insured, for
two years from the Date of Issue or for two years from the effective date of a
reinstatement (Section 4.6). An increase in the amount of insurance after the
Date of Issue, which occurred upon the request of the Owner and was subject to
the Company's insurability requirements, will be incontestable after the
increase has been in force, during the lifetime of at least one Insured, for two
years from the effective date of the increase.
1.5 SUICIDE
If either Insured dies by suicide within one year from the Date of Issue,
the policy will terminate. The amount payable by the Company will be limited to
the premiums paid, less the amount of any policy debt and withdrawals. If either
Insured dies by suicide within one year from the effective date of an increase
in the amount of insurance which occurred upon the request of the Owner and was
subject to the Company's insurability requirements, the amount payable with
respect to such increase will be limited to the Monthly Policy Charges plus any
transaction charges attributable to the increase.
1.6 POLICY DATE AND DATE OF ISSUE
Monthly processing dates and policy months, years and anniversaries are
computed from the Policy Date. The contestable and suicide periods begin with
the Date of Issue. These dates are shown on page 3. The Date of Issue for any
insurance issued under Specified Amount Changes (Section 3.3) will be shown on
an amendment to the Schedule of Benefits and Premiums.
1.7 MISSTATEMENT OF AGE OR SEX
If the age or sex of either insured has been misstated, the death benefit
and Policy Value will be modified by recalculating all Monthly Policy Charges
based on the correct age and sex of the Insureds.
1.8 PAYMENTS BY THE COMPANY
All payments by the Company under this policy are payable at its Home
Office.
1.9 REPORTS TO OWNER
At least once each policy year, the Company will send to the Owner:
- a statement of the death benefit, the Policy Value, and any policy
debt, including loan interest.
- a report of the Separate Account, including financial statements.
- any other information required by law.
SECTION 2. OWNERSHIP
<PAGE>
2.1 THE OWNER
The Owner is named on page 3. The Owner, the Owner's successor or the
Owner's transferee may exercise policy rights without the consent of any
beneficiary, except to the extent the Owner's rights are restricted by a
designation of an irrevocable beneficiary. After the second death, policy
rights may be exercised only as provided in Section 10.
2.2 TRANSFER OF OWNERSHIP
The Owner may transfer the ownership of this policy. Written proof of
transfer satisfactory to the Company must be received at its Home Office. The
transfer will then take effect as of the date that it was signed. The Company
may require that the policy be sent to it for endorsement to show the transfer.
2.3 COLLATERAL ASSIGNMENT
The Owner may assign this policy as collateral security. The Company is
not responsible for the validity or effect of the collateral assignment. The
Company will not be responsible to an assignee for any payment or other action
taken by the Company before receipt of the assignment in writing at its Home
Office.
The interest of any beneficiary will be subject to any collateral
assignment made either before or after the beneficiary is named, unless the
beneficiary was designated an irrevocable beneficiary before the assignment.
The collateral assignee is not an Owner. The collateral assignment is not
a transfer of ownership. Ownership can be transferred only by complying with
Section 2.2.
RR.VJL.(1298) 10
<PAGE>
SECTION 3. DEATH BENEFIT
3.1 DEATH BENEFIT OPTIONS
This policy provides for three death benefit options prior to the Age 100
Date. The option in effect and the Age 100 Date are shown on page 3.
SPECIFIED AMOUNT (OPTION A) - The death benefit before the Age 100 Date is the
greater of:
- the Specified Amount; or
- the Minimum Death Benefit.
SPECIFIED AMOUNT PLUS POLICY VALUE (OPTION B) - The death benefit before the
Age 100 Date is the greater of:
- the Specified Amount plus the Policy Value; or
- the Minimum Death Benefit.
SPECIFIED AMOUNT PLUS PREMIUMS PAID
(OPTION C) - The death benefit before the Age 100 Date is the greater of:
- the Specified Amount plus the sum of the premiums paid; or
- the Minimum Death Benefit.
MINIMUM DEATH BENEFIT. The Minimum Death Benefit is the amount required to
maintain this policy as a life insurance contract for federal tax purposes. The
test used for determining compliance with the federal tax definition of a life
insurance contract is shown on page 3 and will be either:
(1) the Guideline Premium/Cash Value Corridor Test: in that case, the Minimum
Death Benefit equals the greater of the Policy Value multiplied by the
corridor percentage shown on page 7 for the current policy year or the
minimum amount required to maintain this policy as a life insurance
contract for federal tax purposes; or
(2) the Cash Value Accumulation Test: in that case, the Minimum Death Benefit
equals the greater of the Policy Value divided by the Net Single Premium
shown on page 7 for the current policy year or the minimum amount required
to maintain this policy as a life insurance contract for federal tax
purposes.
AGE 100 DATE AND LATER. The death benefit on and after the Age 100 Date will
be the greater of the Policy Value or the minimum amount required to maintain
this policy as a life insurance contract for federal tax purposes.
3.2 DEATH BENEFIT OPTION CHANGES
Subject to approval by the Company, the Owner may change the death benefit
option upon written request. This change will be effective on the first monthly
processing date following receipt of the request at the Home Office. The
Company reserves the right to charge for a death benefit option change. This
charge will be deducted from the Policy Value and will not exceed the amount
shown on page 5. A change will not be allowed if the Specified Amount following
a change would be less than the minimum amount the Company would issue at the
time of change.
CHANGES TO OPTION A. The death benefit option may be changed to Option A at
any time before the Age 100 Date. On the effective date of change, the
Specified Amount will be changed as follows:
(1) If the change is from Option B to Option A, the Specified Amount after the
change will be equal to the Specified Amount before the change plus the
Policy Value on the effective date of the change.
(2) If the change is from Option C to Option A, the Specified Amount after the
change will be equal to the Specified Amount before the change plus the sum
of the premiums paid as of the effective date of the change.
<PAGE>
CHANGES TO OPTION B OR OPTION C. The death benefit option may be changed to
Option B or Option C at any time before the policy anniversary nearest the older
Insured's 85th birthday provided the following requirements are met:
- both Insureds are alive;
- evidence of insurability is given that is satisfactory to the Company;
and
- under the Company's underwriting standards, both Insureds are in the
same underwriting classification as, or in a better underwriting
classification than, they were in on the Date of Issue.
On the effective date of change, the Specified Amount will be changed as
follows:
(1) If the change is from Option A to Option B, the Specified Amount after the
change will be equal to the Specified Amount before the change minus the
Policy Value on the effective date of the change.
(2) If the change is from Option A to Option C, the Specified Amount after the
change will be equal to the Specified Amount before the change minus the
sum of the premiums paid as of the effective date of the change.
(3) If the change is from Option B to Option C, the Specified Amount after the
change will be equal to the Specified Amount before the change plus (a) the
Policy Value on the effective date of the change, minus (b) the sum of the
premiums paid as of the effective date of the change.
(4) If the change is from Option C to Option B, the Specified Amount after the
change will be equal to the Specified Amount before the change plus (a)
the sum of the premiums paid as of the effective date of the change, minus
(b) the Policy Value on the effective date of the change.
RR.VJL.(1298) 11
<PAGE>
3.3 SPECIFIED AMOUNT CHANGES
The Owner may change the Specified Amount upon written request subject to
approval by the Company. This change will be effective on the first monthly
processing date following receipt of the request at the Home Office. The
Company reserves the right to charge for more than one Specified Amount change
in a policy year. This charge will be deducted from the Policy Value and will
not exceed the amount shown on page 5.
INCREASES. An increase will be made only if, at the time applied for, the
following requirements are met:
- both Insureds are alive;
- the insurance in force, as increased, will be within the Company's
issue limits;
- the increase request is received prior to the policy anniversary
nearest the older Insured's 85th birthday;
- evidence of insurability is given that is satisfactory to the Company;
and
- under the Company's underwriting standards, both Insureds are in the
same underwriting classification as, or in a better underwriting
classification than, they were in on the Date of Issue.
DECREASES. A decrease will not be allowed if the Specified Amount following the
decrease would be less than the minimum amount the Company would issue at the
time of change. For the purposes of incontestability and suicide provisions
(Section 1.4 and Section 1.5), a decrease in Specified Amount will first reduce
any past increases in the reverse order in which they occurred and then reduce
the Specified Amount originally issued.
SECTION 4. PREMIUMS, TRANSFERS AND REINSTATEMENT
4.1 PREMIUM PAYMENT
Premiums may be paid to the Company at any time on or before the Final
Premium Date shown on page 3. All premiums after the first are payable at the
Home Office or to an authorized agent. A receipt signed by an officer of the
Company will be furnished on request. The minimum premium the Company will
accept is shown on page 3. Other premium limitations are described in
Section 4.4.
4.2 NET PREMIUM
The net premium is the amount of each premium paid that is available for
allocation to the Divisions of the Separate Account. The amount of the net
premium will be:
- the premium paid; less
- the Premium Expense Charge.
The Premium Expense Charge will consist of the amounts shown on page 4.
4.3 ALLOCATION OF NET PREMIUMS
AND SUBSEQUENT TRANSFERS
For premiums paid to the Company prior to the Initial Allocation Date, the
net premiums will be allocated to the Money Market Division on the date the
premiums are received in the Home Office. The Initial Allocation Date is shown
on page 8.
On the Initial Allocation Date, amounts in the Money Market Division will
be allocated in accordance with the application. This allocation will remain in
effect for subsequent net premiums, loan repayments, and dividends credited
unless changed by the Owner by written request. Any change in allocation will
be in effect for net premiums, loan repayments, and dividends credited to the
policy following the receipt of the written request at the Home Office.
Allocations must be in whole percentages.
<PAGE>
On or after the Initial Allocation Date, the Owner may transfer the amounts
invested in any of the Divisions. The transfer will take effect on the date a
written request is received in the Home Office. The Company reserves the right
to charge for more than twelve transfers in a policy year. This charge will be
deducted from the Policy Value and will not exceed the amount shown on page 5.
RR.VJL.(1298) 12
<PAGE>
4.4 PREMIUM LIMITATIONS
A premium payment that would increase the policy's death benefit more than
it increases the Policy Value will be accepted only if:
- both Insureds are alive;
- the insurance in force, as increased, will be within the Company's
issue limits;
- the premium payment is received prior to the policy anniversary
nearest the older Insured's 85th birthday;
- evidence of insurability is given that is satisfactory to the Company;
and
- under the Company's underwriting standards, both Insureds are in the
same underwriting classification as, or in a better underwriting
classification than, they were in on the Date of Issue.
If the Definition of Life Insurance Test shown on page 3 is the Guideline
Premium/Cash Value Corridor Test, then the Company will not accept any premium
that disqualifies this policy as a life insurance contract for federal tax
purposes. Further, the Company reserves the right to make distributions or
refunds of excess premium (with interest as required by the federal tax law)
from this policy as necessary to continue to qualify the policy as a life
insurance contract for federal tax purposes.
4.5 GRACE PERIOD
A grace period of 61 days will be allowed for the payment of sufficient
premium to keep the policy in force if the cash value on a monthly processing
date is less than the current Monthly Policy Charge; however, no premium will be
accepted after the Final Premium Date shown on page 3. The minimum premium that
must be paid is three times the Monthly Policy Charge due when the insufficiency
occurred.
The grace period will begin on the date the Company sends written notice of
the insufficiency. The grace period will end 61 days after the notice is sent.
The notice will be sent to the Owner and will state the date the grace period
ends and the amount of premium required to keep the policy in force. Upon
receipt of payment, the Company will allocate the net premium, less any Monthly
Policy Charges due and unpaid, to the Divisions of the Separate Account
according to the allocation of net premiums then in effect.
The policy will remain in force during the grace period. If sufficient
premium is not paid by the end of the grace period, the policy will terminate
with no value.
If the second death occurs during the grace period, any Monthly Policy
Charges due and unpaid will be deducted from the death proceeds of the policy.
4.6 REINSTATEMENT
CONDITIONS. If this policy has terminated under Section 4.5, it may be
reinstated upon receipt at the Home Office of:
- an application for reinstatement within three years after the end of
the grace period; and
- a reinstatement premium equal to or greater than the minimum
reinstatement premium.
In addition, the Company's insurability requirements must be met.
This policy may not be reinstated:
- if the policy was surrendered for its cash value; or
- if either of the Insureds died after the end of the grace period.
MINIMUM REINSTATEMENT PREMIUM. The minimum premium needed to reinstate the
policy is:
<PAGE>
- the sum of all Monthly Policy Charges (Section 7.2) that were due and
unpaid before the end of the grace period; plus
- three times the Monthly Policy Charge due on the effective date of
reinstatement.
INSURABILITY REQUIREMENTS. These requirements are:
- evidence of insurability is given that is satisfactory to the Company;
and
- under the Company's underwriting standards, both Insureds are in the
same underwriting classification as, or in a better underwriting
classification than, they were in on the Date of Issue, or if only one
Insured was alive at the end of the grace period, that Insured is in
the same underwriting classification as, or in a better underwriting
classification than, that Insured was in on the Date of Issue.
EFFECTIVE DATE OF REINSTATEMENT. If the Company approves the application for
reinstatement, the effective date of reinstatement will be the first monthly
processing date following receipt at the Home Office of the reinstatement
application.
On the effective date of reinstatement, the Policy Value will be equal to:
- the reinstatement premium paid, less the Premium Expense Charge; plus
- any policy debt as of the end of the grace period; less
- the sum of all Monthly Policy Charges that were due and unpaid before
the end of the grace period; less
- the Monthly Policy Charge due on the effective date of reinstatement.
On the effective date of reinstatement, the Policy Value, less any policy debt
that is not repaid, will be allocated to the Divisions of the Separate Account
according to the allocation in effect at the end of the grace period.
RR.VJL.(1298) 13
<PAGE>
SECTION 5. DIVIDENDS
5.1 ANNUAL DIVIDENDS
This policy will share in the divisible surplus of the Company to the
extent it contributes to this surplus. This surplus is determined each year.
This policy's share will be credited as a dividend on the policy anniversary.
Since this policy is not expected to contribute to divisible surplus, it is
not expected that any dividends will be paid.
5.2 USE OF DIVIDENDS
Annual dividends may be paid in cash or used to increase the Policy Value.
Dividends used to increase the Policy Value will be allocated to the Divisions
of the Separate Account according to the allocation of net premiums then in
effect. If no direction is given for the use of dividends, they will be used
to increase the Policy Value.
5.3 DIVIDEND AT DEATH
If a dividend is payable for the period from the beginning of the policy
year to the date of the second death, the dividend is payable as part of the
policy proceeds.
SECTION 6. THE SEPARATE ACCOUNT
6.1 DESCRIPTION
Northwestern Mutual Variable Life Account (the Separate Account) is
registered as a unit investment trust under the Investment Company Act of 1940.
The Separate Account has several Divisions, as shown on page 8. Assets of the
Separate Account are invested in shares of Northwestern Mutual Series Fund, Inc.
(the Fund). The Fund is registered under the Investment Company Act of 1940 as
an open-end, diversified investment company. The Fund has one Portfolio for
each Division. Assets of each Division of the Separate Account are invested in
shares of the corresponding Portfolio of the Fund. Shares of the Fund are
purchased for the Separate Account at their net asset value. The Company may
make available additional Divisions and Portfolios.
Assets will be allocated to the Separate Account to support the operation
of this and other variable life insurance policies. Assets may also be
allocated for other purposes, but not to support the operation of any contracts
or policies other than variable life insurance. Income and realized and
unrealized gains and losses from assets in the Separate Account are credited to
or charged against it without regard to other income, gains or losses of the
Company.
The assets of the Separate Account will be valued on each valuation day.
They are the property of the Company. The portion of these assets equal to
policy reserves and liabilities will not be charged with liabilities arising out
of any other business the Company may conduct. The Company reserves the right
to transfer assets of the Separate Account in excess of these reserves and
liabilities to its general account.
The Owner may exchange this policy for a fixed benefit joint life insurance
policy being offered at that time by the Company if the Fund changes its
investment advisor or if a Portfolio has a material change in its investment
objectives or restrictions. The Company will notify the Owner if there is any
such change. The Owner may exchange this policy within 60 days after the notice
or the effective date of the change, whichever is later.
<PAGE>
If, in the judgment of the Company, a Portfolio no longer suits the
purposes of this policy due to a change in its investment objectives or
restrictions, the Company may substitute shares of another Portfolio of the Fund
or shares of another mutual fund. Any such substitution will be subject to any
required approval of the Securities and Exchange Commission (SEC), the Wisconsin
Commissioner of Insurance or other regulatory authority.
The Company also may, to the extent permitted by applicable laws and
regulations (including any order of the SEC), make changes as follows:
- the Separate Account or a Division may be operated as a management
company under the Investment Company Act of 1940, or in any other form
permitted by law, if deemed by the Company to be in the best interest
of the policyowners.
- the Separate Account may be deregistered under the Investment Company
Act of 1940 in the event registration is no longer required.
- the provisions of this and other policies may be modified to comply
with any other applicable federal or state laws.
In the event of a substitution or change, the Company may make appropriate
endorsement of this and other policies having an interest in the Separate
Account and take other actions as may be necessary to effect the substitution or
change.
6.2 VALUATION DAY AND
VALUATION PERIOD
A valuation day is any day on which the assets of the Separate Account are
valued. A valuation period is a valuation day and any immediately preceding
days which are not valuation days.
Assets are valued as of the close of trading on the New York Stock Exchange
on each day the Exchange is open. Each Division's share of amounts allocated,
transferred or added to a Division or deducted, loaned, transferred or withdrawn
from a Division, on any day, will be determined as of the end of the valuation
period that contains that day.
RR.VJL.(1298) 14
<PAGE>
SECTION 7. DETERMINATION OF VALUES
7.1 POLICY VALUE
On the Policy Date, the Policy Value is equal to the net premium less the
Monthly Policy Charge. On any day after that, the Policy Value is equal to what
it was on the previous day plus any of these items applicable on that day:
- any increase due to investment results as described in Section 7.4 for
the portion of the Policy Value invested in Divisions with a positive
rate of return for the current valuation period;
- interest on the policy debt at an annual effective rate of 5%;
- the net premium, if a premium is paid;
- any policy dividend directed to increase the Policy Value; and
minus any of these items applicable on that day:
- any decrease due to investment results as described in Section 7.4 for
the portion of the Policy Value invested in Divisions with a negative
rate of return for the current valuation period;
- the Monthly Policy Charge;
- any withdrawals; and
- any transaction charges that may result from a withdrawal, a transfer,
a change in the Specified Amount or a change in the death benefit
option.
The Monthly Policy Charge, any withdrawals, and any transaction charges
will be deducted from the Policy Value. The deduction will be allocated to each
Division in proportion to the amounts in each Division.
7.2 MONTHLY POLICY CHARGE
A Monthly Policy Charge is deducted from the Policy Value on each monthly
processing date until the second death and is equal to the sum of the following:
- the Administrative Charge;
- the Underwriting and Issue Charge;
- the Mortality and Expense Risk Charge;
- the Deferred Sales Charge;
- the Cost of Insurance Charge; and
- if there is policy debt, a charge for expenses and taxes associated
with that debt.
The maximum Administrative, Underwriting and Issue, Mortality and Expense
Risk, and Deferred Sales charges are shown on page 4.
7.3 COST OF INSURANCE CHARGE
A Cost of Insurance Charge is deducted from the Policy Value on each
monthly processing date as part of the Monthly Policy Charge. The Cost of
Insurance Charge is the cost of insurance rate times the net amount at risk.
The maximum cost of insurance rates are shown on page 6. The net amount at risk
is (a) minus (b) where:
(a) is the death benefit on the monthly processing date (after deduction
of the Administrative Charge, the Underwriting and Issue Charge, the
Mortality and Expense Risk Charge, the Deferred Sales Charge, and, if
there is policy debt, a charge for expenses and taxes associated with
that debt) divided by 1.0032737; and
(b) is the Policy Value on the monthly processing date, after deduction of
the Administrative Charge, the Underwriting and Issue Charge, the
Mortality and Expense Risk Charge, the Deferred Sales Charge, and, if
there is policy debt, a charge for expenses and taxes associated with
that debt.
<PAGE>
7.4 INVESTMENT RESULTS
Investment results are reflected in the Policy Value each valuation period.
The investment results for each Division of the Policy Value equal the
Division's share of the Policy Value at the end of the previous valuation period
times the rate of return for that Division for the current valuation period.
The rate of return of a Division for a valuation period is obtained by
dividing the result of (a) minus (b) by (b) where:
(a) is the sum of:
- the value of a share of the corresponding Portfolio of the Fund
at the close of the current valuation period; plus
- the per share amount of any investment income and capital gains
distributed by the Fund for the current valuation period; and
(b) is the value of the share at the close of business for the immediately
preceding valuation period.
The rate of return and corresponding investment results may be positive or
negative. If the rate of return is positive, there will be an increase in
values for the Division; if it is negative, there will be a decrease in values
for the Division.
RR.VJL.(1298) 15
<PAGE>
SECTION 8. CASH VALUE AND SURRENDER
8.1 CASH VALUE
The cash value of this policy is equal to:
- the Policy Value; less
- the surrender charge; less
- any policy debt.
8.2 SURRENDER
The Owner may surrender this policy for its cash value. A written
surrender of all claims, satisfactory to the Company, will be required. The
date of surrender will be the date of receipt at the Home Office of the written
surrender. The policy will terminate, and the cash value will be determined, as
of the end of the valuation period which includes the date of surrender. The
Company may require that the policy be sent to it.
8.3 SURRENDER CHARGE
There is a surrender charge if this policy is surrendered during the first
ten policy years. The surrender charge is a percentage of the total premiums
paid during the first policy year, subject to the maximum surrender charge. The
surrender charge percentage and maximum surrender charge are shown on page 5.
8.4 BASIS OF VALUES
A detailed statement of the method of calculation of all values for this
policy has been filed with the insurance supervisory official of the state in
which this policy is delivered. All values are at least as great as those
required by that state.
8.5 DEFERRAL OF PAYMENTS
The Company reserves the right:
- to defer determination of the cash value and payment of the cash
value;
- to defer payment of a loan or withdrawal; and
- to defer determination of a change in the amount of variable insurance
or other variable amounts payable on the second death, and, if such
determination has been deferred, to defer payment of the death
benefit;
during any period when:
- the New York Stock Exchange is closed or trading on the New York Stock
Exchange is restricted as determined by the SEC; or
- the SEC declares that an emergency exists as a result of which the
sale or determination of investment results is not reasonably
practicable; or
- the SEC, by order, permits deferral for the protection of the
Company's policyowners.
RR.VJL.(1298) 16
<PAGE>
SECTION 9. LOANS AND WITHDRAWALS
9.1 POLICY LOANS
The Owner may obtain a loan from the Company in an amount that, when added
to existing policy debt, is not more than the loan value.
On the date a loan is made, the amount of the loan will be transferred from
the Separate Account to the general account of the Company. This amount will be
deducted from each Division in proportion to the amounts in each Division. On
the date a loan repayment is made, or the date accrued interest is paid, the
amount of the payment will be transferred from the general account of the
Company to the Separate Account. This amount will be allocated to the Divisions
of the Separate Account according to the allocation of net premiums then in
effect.
9.2 LOAN VALUE
The loan value is 90% of:
- the Policy Value on the date of the loan; less
- the surrender charge on the date of the loan.
9.3 POLICY DEBT
Policy debt consists of all outstanding loans and accrued interest. Loan
repayments may be made, or accrued interest paid, at any time. Any policy debt
will be deducted from the policy proceeds.
If the policy debt equals or exceeds the Policy Value less the surrender
charge on a monthly processing date, the policy will terminate with no value
subject to the conditions of the Grace Period (Section 4.5).
9.4 LOAN INTEREST
Interest accrues on a daily basis from the date of the loan. Unpaid
interest is added to the loan.
Interest is payable at an annual effective rate of 5%.
9.5 PARTIAL WITHDRAWALS
The Owner may withdraw a portion of the cash value. However, the Owner may
not:
- withdraw an amount which would reduce the loan value to less than the
policy debt;
- withdraw an amount which would reduce the death benefit to less than
the minimum amount the Company would issue on this plan of insurance
at the time of withdrawal;
- withdraw an amount which would reduce the cash value to less than
three times the most recent Monthly Policy Charge;
- withdraw less than the minimum withdrawal amount shown on page 3; or
- make more than four withdrawals in a policy year.
When a portion of the cash value is withdrawn, the amount invested for this
policy in the Separate Account will be reduced by the amount of the withdrawal.
The reduction will be allocated to each Division in proportion to the amounts in
each Division. If the death benefit option in effect at the time of withdrawal
is either Option A or Option C, the Specified Amount will be reduced by the
lesser of:
- the amount of the withdrawal; or
<PAGE>
- the excess, if any, of the Specified Amount for Option A or the
Specified Amount plus the sum of the premiums paid for Option C, over
the result of (a) minus (b) where:
(a) is the death benefit immediately prior to the withdrawal; and
(b) is the amount of the withdrawal.
The Company reserves the right to charge for withdrawals. This charge
will be deducted from the Policy Value and will not exceed the amount shown on
page 5.
SECTION 10. BENEFICIARIES
10.1 DEFINITION OF BENEFICIARIES
The term "beneficiaries" as used in this policy includes direct
beneficiaries, contingent beneficiaries and further payees.
10.2 NAMING AND CHANGE OF BENEFICIARIES
CONDITIONS. The Owner may name and change the beneficiaries of death proceeds:
- before the second death.
- during the first 60 days after the date of the second death, if the
second Insured to die was not the Owner immediately prior to the
second death. A change made during this 60 days may not be revoked.
EFFECTIVE DATE. A naming or change of a beneficiary will be made on receipt at
the Home Office of a written request that is acceptable to the Company. The
request will then take effect as of the date that it was signed. The Company is
not responsible for any payment or other action that is taken by it before the
receipt of the request. The Company may require that the policy be sent to it
to be endorsed to show the naming or change.
10.3 SUCCESSION IN INTEREST OF
BENEFICIARIES
DIRECT BENEFICIARIES. The proceeds of this policy will be payable in equal
shares to the direct beneficiaries who survive and receive payment. If a direct
beneficiary dies before receiving the direct beneficiary's share, that share
will be payable in equal shares to the other direct beneficiaries who survive
and receive payment.
CONTINGENT BENEFICIARIES. At the death of all of the direct beneficiaries, the
proceeds will be payable in equal shares to the contingent beneficiaries who
survive and receive payment. If a contingent beneficiary dies before receiving
the contingent beneficiary's share, that share will be payable in equal shares
to the other contingent beneficiaries who survive and receive payment.
FURTHER PAYEES. At the death of all of the direct and contingent beneficiaries,
the proceeds will be paid:
- in equal shares to the further payees who survive and receive payment;
or
- if no further payees survive and receive payment, to the estate of the
last to die of all of the direct and contingent beneficiaries who
survive both Insureds.
OWNER OR THE OWNER'S ESTATE. If no beneficiaries are alive on the date of the
second death, the proceeds will be paid to the Owner or to the Owner's estate.
<PAGE>
10.4 GENERAL
TRANSFER OF OWNERSHIP. A transfer of ownership of itself will not change the
interest of a beneficiary.
CLAIMS OF CREDITORS. So far as allowed by law, no amount payable under this
policy will be subject to the claims of creditors of a beneficiary.
RR.VJL.(1298) 17
<PAGE>
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
720 E. WISCONSIN AVENUE, MILWAUKEE, WISCONSIN 53202
<TABLE>
<CAPTION>
<S><C>
JOINT LIFE PROTECTION INSURANCE APPLICATION ------------------------------------
POLICY NUMBER
- -----------------------------------------------------------------------------------------------------------------------------------
/ / Companion policies / / Life & Disability Application / / LTC Application Plan Group Number
/ / APB Option / / Exam (NM, PME, MD) in Home Office
------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
FIRST INSURED (YOUNGER)
ON PAGES 1,2,3 AND 4, "INSURED" REFERS TO THE FIRST INSURED.
- -----------------------------------------------------------------------------------------------------------------------------------
Has an application or informal inquiry ever been made to Northwestern Mutual Life for annuity, life,
long term care, or disability insurance on the life of the insured? / / Yes /X/ No If yes, the last policy number is
---------
1. A. /X/ Mr. / / Mrs. / / Ms. / / Dr. / / Other B. /X/ MALE
----------------- / / FEMALE
NAME: JOHN J DOE
---------------------------------------------------------
(FIRST, MIDDLE INITIAL, LAST)
- -----------------------------------------------------------------------------------------------------------------------------------
C. BIRTHDATE: (MONTH, DAY, YEAR) D. STATE OF BIRTH (or Foreign Country): E. TAXPAYER IDENTIFICATION NUMBER:
12 /31 / 1963 Wisconsin # ###-##-####
---------------------------- ----------------------------------- ------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
F. PRIMARY RESIDENCE: STREET OR PO BOX: 1234 Main Street
---------------------------------------------------------------------------
CITY, STATE, ZIP (Country if other than U.S.A.): Milwaukee, WI 53200
---------------------------------------------------------------------------
E-MAIL ADDRESS:
---------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
APPLICANT
- -----------------------------------------------------------------------------------------------------------------------------------
2. Select ONLY ONE: /X/ First Insured @ First Insured's address / / Other (Complete A, B and C)
A. / / Mr. / / Mrs. / / Ms. / / Dr. / / Other
-----------------
PERSONAL
NAME: / / MALE
--------------------------------------------------------------- / / FEMALE
(FIRST, MIDDLE INITIAL, LAST)
BIRTHDATE: | |
-------------------------
MONTH DAY YEAR
OR BUSINESS/TRUST
NAME:
---------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
B. TAXPAYER IDENTIFICATION NUMBER: C. DAYTIME TELEPHONE NUMBER:
Area Code ( )
-------------------------------------- ----------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
Send premium and other notices regarding this policy to:
D. ADDRESS: /X/ First Insured's Address / / Applicant's Address OR
STREET OR PO BOX:
----------------------------------------------------------------------------
CITY, STATE, ZIP (Country if other than U.S.A.):
----------------------------------------------------------------------------
E-MAIL ADDRESS:
----------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
90-1 JCL (0198) 90-1934-50 (page 1)
<PAGE>
<TABLE>
<CAPTION>
<S><C>
- ------------------------------------------------------------------------------------------------------------------------
CAUTION: A MINOR OWNER CANNOT EXERCISE POLICY RIGHTS.
4. Select ONLY ONE: /X/ First Insured (Complete C only) / / Applicant (Complete C only)
/ / Other (Complete A, B and C) / / See attached supplement form
A. / / Mr. / / Mrs. / / Dr. / / Other
---------------------
PERSONAL / / MALE
NAME: / / FEMALE
----------------------------------------------------
(FIRST MIDDLE INITIAL LAST)
RELATIONSHIP TO INSURED: BIRTHDATE: | |
---------------------------------- ---------------------
OR BUSINESS/TRUST MONTH DAY YEAR
NAME:
----------------------------------------------------
RELATIONSHIP TO INSURED:
------------------------------------
- ------------------------------------------------------------------------------------------------------------------------
B. TAXPAYER IDENTIFICATION NUMBER:
--------------------------
- ------------------------------------------------------------------------------------------------------------------------
C. ADDRESS: /X/ First Insured's Address / / Applicant's Address / / Premium Payer's Address OR
STREET OR PO BOX:
-----------------------------------------------------------------
CITY, STATE, ZIP (Country if other than U.S.A.):
-----------------------------------------------------------------
E-MAIL ADDRESS:
-----------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------
5.-7. (Reserved)
SPECIAL DATE (COMPLETE THIS SECTION ONLY IF A SPECIAL POLICY DATE IS BEING REQUESTED)
- ------------------------------------------------------------------------------------------------------------------------
8. A. Prepaid: / / Short-Term - Policy Date will coincide with ISA Payment Date (For monthly ISA only)
/ / Short-Term to: | | / / Backdate to | |
--------------------- ---------------------
MONTH DAY YEAR MONTH DAY YEAR
B. Nonprepaid: / / Specified future date: | | / / Backdate to | |
--------------------- ---------------------
MONTH DAY YEAR MONTH DAY YEAR
- ------------------------------------------------------------------------------------------------------------------------
POLICY APPLIED FOR
- ------------------------------------------------------------------------------------------------------------------------
9. Joint Life Protection (See attached supplement)
10. If an additional benefit cannot be approved, should the company issue a policy without the benefit? / / Yes / / No
11. Shall the PREMIUM LOAN provision, if available, become operative according to its terms? /X/ Yes / / No
12.-13. (Reserved)
14. PREMIUM FREQUENCY: /X/ Annually / / Semiannually / / Quarterly
- ------------------------------------------------------------------------------------------------------------------------
BENEFICIARY
- ------------------------------------------------------------------------------------------------------------------------
15. A. DIRECT BENEFICIARY
First, Middle Initial, Last Relationship to Insured
(1) Mary J. Doe Daughter
----------------------------------------------------------------------------------- -----------------------
(2)
----------------------------------------------------------------------------------- -----------------------
(3)
----------------------------------------------------------------------------------- -----------------------
Business organization or trust
--------------------------------------------------------- -----------------------
---------------------------------------------------------
B. CONTINGENT BENEFICIARY:
First, Middle Initial, Last Relationship to Insured
(1)
----------------------------------------------------------------------------------- -----------------------
(2)
----------------------------------------------------------------------------------- -----------------------
(3)
----------------------------------------------------------------------------------- -----------------------
Box (1) or (2) may be selected to include all of the children or brothers and sisters without naming them, or to
add to the contingent beneficiaries named. Box (3) may be selected to provide for the children of a deceased
contingent beneficiary; use only if contingent beneficiaries are named and/or Box (1) or (2) is checked.
NOTE: The word "children" includes child and any legally adopted child.
/X/ (1) and all (other) children of the Insured.
/ / (2) and all (other) brothers and sisters of the Insured born of the marriage of or legally adopted
by and before the Insured's death.
-------------------------- -----------------------------
/ / (3) any amount that would have been paid to a deceased contingent beneficiary, if living, will be paid in one
sum and in equal shares to the children of that contingent beneficiary who survive and receive payment.
C. FURTHER PAYEES
First, Middle Initial, Last Relationship to Insured
(1)
----------------------------------------------------------------------------------- -----------------------
(2)
----------------------------------------------------------------------------------- -----------------------
D. / / SEE ATTACHED SUPPLEMENT FORM (To be used in place of designations above.)
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
90-1 JCL (0198) (page 2)
<PAGE>
<TABLE>
<S><C>
16. (Reserved)
CONDITIONAL LIFE INSURANCE AGREEMENT
- ---------------------------------------------------------------------------------------------------------------------------
17. Has the premium for the policy applied for been given to the agent in exchange for the Conditional
Life Insurance Agreement with the same number as this application? /X/ Yes / / No
- ---------------------------------------------------------------------------------------------------------------------------
INSURANCE HISTORY
- ---------------------------------------------------------------------------------------------------------------------------
18. Has the insured ever had life, disability or health insurance declined, rated, modified, issued with
an exclusion rider, cancelled, or not renewed? If yes, explain in REMARKS. / / Yes /X/ No
19. When was the Insured's last examination or application for life, disability or accidental death insurance?
Month Year Company
--------------- ------------ --------------------------------------------------- OR /X/ NONE
20. Does the Insured have any other life insurance in force, pending or contemplated in other companies? / / Yes /X/ No
If yes, indicate Company Name, Individual (Ind) or Group (Grp) and identify the amount of in Force,
Pending or Contemplated.
LIFE INSURANCE AMOUNTS
-----------------------------------------------------------------------------------------------------------------------
Company Name Ind/Grp In Force Pending Contemplated Accidental
Amount Amount Amount Death Amount
-----------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------
21. As a result of this purchase will the values or benefits of any other life insurance policy or annuity
contract, on any life, be affected in any way? / / Yes /X/ No
NOTE TO AGENT: VALUES OR BENEFITS ARE AFFECTED IF ANY QUESTION ON THE
DEFINITION OF REPLACEMENT SUPPLEMENT COULD BE ANSWERED "YES".
If "yes", this transaction is a replacement of life insurance or annuity.
The agent must:
- submit required papers and sale materials AND
- provide required disclosure notices to the applicant.
The applicant must answer the questions:
- on the Definition of Replacement Supplement AND
- A, B, and C below.
Will this insurance:
A. replace Northwestern Mutual Life? / / Yes /X/ No
B. replace other Companies? / / Yes /X/ No
C. result in 1035 exchange? / / Yes /X/ No
- ---------------------------------------------------------------------------------------------------------------------------
22. (Reserved)
REMARKS
- ---------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
90-1 JCL (0198) (page 3)
<PAGE>
<TABLE>
<CAPTION>
<S><C>
------------------------------------------------------------
FIRST MIDDLE INITIAL LAST
PERSONAL HISTORY QUESTIONNAIRE - FIRST INSURED
- -----------------------------------------------------------------------------------------------------------------------------------
23. Insured's Marital Status: / / Single, Widowed or Divorced /X/ Married
24. a. Insured is a citizen of: /X/ U.S.A. / / Other
If other: Type of Visa: Visa Number:
------------------- ----------------
b. How many years has the insured resided in the U.S.A. immediately prior to completing this application? 35 years
------
25. Does the Insured regularly travel outside the U.S.A. or have plans to leave the U.S.A. for travel or
residence? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ./ /Yes /X/ No
If yes, explain in the chart below.
-------------------------------------------------------------------------------------------------------------------------------
Destination Number of Trips Duration of Departure Date Purpose of Trip
(List all Cities and Countries) Last 12 Next 12 Each Trip (Month/Year)
Months Months (No. of Days)
-------------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------------
26. a. What is the Insured's occupation(s)? Attorney
---------------------------------------------------------------------------------------
What are the Insured's duties? Office Duties
---------------------------------------------------------------------------------------------
b. Employer's Name: ABC Corporation
-----------------------------------------------------------------------------------------------------------
Address: 1000 Company Ave.
------------------------------------------------------------------------------------------------------------
City, State, Zip Code: Milwaukee, WI 53200
-----------------------------------------------------------------------------------------------------
c. How long has the insured been employed? 7 years (if less than 2
years, explain in REMARKS) ----------
QUESTIONS 27 THROUGH 30 ARE NOT REQUIRED IF THE INSURED IS UNDER AGE 16.
27. Is the Insured a member of, or does the Insured plan on joining any branch of, the Armed
Forces or reserve military unit? If yes, complete the Military Section . . . . . . . . . . . . . . . . . . ./ / Yes /X/ No
28. Except as a passenger on a regularly scheduled flight, has the Insured flown within the
past 2 years, or does the Insured have plans to fly in the future? If yes, complete the
Aviation Section . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ./ / Yes /X/ No
29. In the past 2 years, has the Insured participated in or does the Insured have plans to
participate in: racing (automobile, snowmobile, motorcycle, boat or go-cart), underwater
or sky diving, hang gliding, bungee jumping, mountain or rock climbing, or rodeos? If yes,
complete the Avocation Section. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . ./ / Yes /X/ No
30. a. What is the Insured's automobile driver's license number? # D555-5555-5555-55 State WI
or, / / the Insured does not have a driver's license. ------------------ --------------
b. In the past 5 years, has the Insured been in a motor vehicle accident, has the Insured
been charged with a moving violation of any motor vehicle law, or has the Insured's
driver's license been restricted, suspended or revoked?
If yes, complete the chart below . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ./ / Yes /X/ No
-------------------------------------------------------------------------------------------------------------------------------
Type and Details Action Accident
Date (Speeding, Reckless Driving, Driving While Intoxicated, Etc.) (Citation, Fine, Etc.) (Yes or No)
-------------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
REMARKS
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
90-1 JCL (0198) (page 4)
<PAGE>
<TABLE>
<CAPTION>
<S><C>
/ / / / / / / / / / /
---------------------
POLICY NUMBER
SECOND INSURED (OLDER) / / Companion policies / /Life & Disability Application / / LTC Application / / Exam (NM, PME, MD) in Home
Office ON PAGES 5 AND 6, "INSURED" REFERS TO THE SECOND INSURED.
- ---------------------------------------------------------------------------------------------------------------------------------
Has an application or informal inquiry ever been made to Northwestern Mutual Life for annuity, life,
long term care, or disability insurance on the life of the insured? / / Yes /X/ No If yes, the last policy number is _________
1. A. / / Mr. /X/ Mrs. / / Ms. / / Dr. / / Other_________ B./ / MALE
Name: JANE J DOE /X/ FEMALE
-----------------------------------------------------------------------------------------------
FIRST MIDDLE INITIAL LAST
- ---------------------------------------------------------------------------------------------------------------------------------
C. BIRTHDATE: (MONTH, DAY, YEAR) D. STATE OF BIRTH (Or Foreign Country): E. TAXPAYER IDENTIFICATION NUMBER:
12-31-1963 Wisconsin ###-##-####
---------- -----------
- ---------------------------------------------------------------------------------------------------------------------------------
F. PRIMARY RESIDENCE: /X/ First Insured's Address OR
STREET OR PO BOX:
--------------------------------------------------------------------------
CITY, STATE, ZIP (Country if other than U.S.A.):
--------------------------------------------------------------------------
E-MAIL ADDRESS:
--------------------------------------------------------------------------
This address will be used for all of the Second Insured's policies.
- ---------------------------------------------------------------------------------------------------------------------------------
2.-9. (Reserved)
- ---------------------------------------------------------------------------------------------------------------------------------
10. If an additional benefit cannot be approved should the Company issue the policy without the benefit? / / Yes / / No
- ---------------------------------------------------------------------------------------------------------------------------------
11.-17. (Reserved)
INSURANCE HISTORY
- ---------------------------------------------------------------------------------------------------------------------------------
18. Has the Insured ever had life, disability or health insurance declined, rated, modified, issued with
an exclusion rider, cancelled, or not renewed? If yes, explain in REMARKS. / /Yes /X/ No
19. When was the Insured's last examination or application for life, disability or accidental death
insurance?
Month Year Company OR /X/ None
----------------------- ------------------------ ------------------------------
20. Does the Insured have any other life insurance in force, pending or contemplated in other companies? / / Yes /X/ No
If yes, indicate Company Name, Individual (Ind) or Group (Grp) and identify the amount of In Force,
Pending, or Contemplated.
LIFE INSURANCE AMOUNTS
------------------------------------------------------------------------------------------------------------------------------
Company Name Ind/Grp In Force Pending Contemplated Accidental
Amount Amount Amount Death Amount
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
21. As a result of this purchase will the values or benefits of any other life insurance policy or
annuity contract, on any life, be affected in any way? / / Yes /X/ No
NOTE TO AGENT: VALUES OR BENEFITS ARE AFFECTED IF ANY QUESTION ON THE
DEFINITION OF REPLACEMENT SUPPLEMENT COULD BE ANSWERED "YES".
If "yes", this transaction is a replacement of life insurance or annuity.
The agent must:
- submit required papers and sale materials and
- provide required disclosure notices to the
applicant.
The applicant must answer the questions:
- on the Definition of Replacement Supplement and
- A, B, and C below.
Will this insurance:
A. replace Northwestern Mutual Life? / / Yes /X/ No
B. replace other Companies? / / Yes /X/ No
C. result in 1035 exchange? / / Yes /X/ No
- ---------------------------------------------------------------------------------------------------------------------------------
22. (Reserved)
REMARKS
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
90-1 JCL (0198) (page 5)
<PAGE>
<TABLE>
<CAPTION>
<S><C>
- ---------------------------------------------------------------------------------------------------------------------------------
23. Insured's Marital Status: / / Single, Widowed or Divorced /X/ Married
24. a. Insured is a citizen of: /X/ U.S.A. / / Other
If other: Type of Visa: Visa Number:
-------------------------- -----------------
b. How many years has the Insured resided in the U.S.A. immediately prior to completing this application? 35 years
-----
25. Does the Insured regularly travel outside the U.S.A. or have plans to leave the U.S.A. for travel or
residence? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ./ / Yes /X/ No
If yes, explain in the chart below.
------------------------------------------------------------------------------------------------------------------------------
Destination Number of Trips Duration of Departure Date Purpose of Trip
(List all Cities and Countries) Last 12 Next 12 Each Trip (Month/Year)
Months Months (No. of Days)
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------
26. a. What is the Insured's occupation(s)? Housewife
--------------------------------------------------------------------------------------
What are the Insured's duties?
--------------------------------------------------------------------------------------------
b. Employer's Name:
----------------------------------------------------------------------------------------------------------
Address:
----------------------------------------------------------------------------------------------------------
City, State, Zip Code:
----------------------------------------------------------------------------------------------------
c. How long has the Insured been employed? years (If less than 2 years, explain in REMARKS)
----------
QUESTIONS 27 THROUGH 30 ARE NOT REQUIRED IF THE INSURED IS UNDER AGE 16.
27. If the Insured a member of, or does the Insured plan on joining any branch of, the Armed Forces
or reserve military unit? If yes, complete the Military Section. . . . . . . . . . . . . . . . . . . . . . ./ / Yes /X/ No
28. Except as a passenger on a regularly scheduled flight, has the Insured flown within the past 2
years, or does the Insured have plans to fly in the future? If yes, complete the Aviation Section. . . . . ./ / Yes /X/ No
29. In the past 2 years, has the Insured participated in or does the Insured have plans to participate
in: racing (automobile, snowmobile, motorcycle, boat or go-cart), underwater or sky diving, hang
gliding, bungee jumping, mountain or rock climbing, or rodeos? If yes, complete the Avocation Section. . . ./ / Yes /X/ No
30. a. What is the Insured's automobile driver's license number? # D333-3333-3333-33 State WI
or, / / the Insured does not have a driver's license. ------------------ ----
b. In the past 5 years, has the Insured been in a motor vehicle accident, has the Insured been
charged with a moving violation of any motor vehicle law, or has the Insured's driver's
license been restricted, suspended or revoked? If yes, complete the chart below . . . . . . . . . . . ./ / Yes /X/ No
-----------------------------------------------------------------------------------------------------------------------------
Type and Details Action Accident
Date (Speeding, Reckless Driving, Driving While Intoxicated, Etc.) (Citation, Fine, Etc.) (Yes or No)
-----------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
REMARKS
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
90-1 JCL (0198) (page 6)
<PAGE>
- --------------------------------------------------------------------------------
EACH INSURED CONSENTS TO THIS APPLICATION AND ATTACHED SUPPLEMENTS AND DECLARES
THAT THE ANSWERS AND STATEMENTS MADE ON THIS APPLICATION AND ATTACHED
SUPPLEMENTS ARE CORRECTLY RECORDED, COMPLETE AND TRUE TO THE BEST OF EACH
INSURED'S KNOWLEDGE AND BELIEF. ANSWERS AND STATEMENTS BROUGHT TO THE
ATTENTION OF THE AGENT, MEDICAL EXAMINER OR PARAMEDICAL EXAMINER ARE NOT
CONSIDERED INFORMATION BROUGHT TO THE ATTENTION OF THE COMPANY UNLESS STATED
IN THE APPLICATION. STATEMENTS IN THIS APPLICATION ARE REPRESENTATIONS AND
NOT WARRANTIES.
It is agreed that:
(1) If the premium is not paid when the application is signed, no insurance
will be in effect. The insurance will take effect at the time the policy
is delivered and the premium is paid, if: both Insureds are living at that
time; and the answers and statements in the application are then true to
the best of each Insured's knowledge and belief.
(2) If the premium is paid when the application is taken, no insurance will
be in effect except as provided in the Conditional Life Insurance
Agreement with the same number as this application.
(3) No agent is authorized to make or alter contracts or to waive any of the
Company's rights or requirements.
-------------------------------------------------------------------------------
THE OWNER OF THE POLICY APPLIED FOR HEREIN CERTIFIES, UNDER PENALTIES OF
PERJURY, (1) THAT THE TAXPAYER IDENTIFICATION NUMBER GIVEN FOR THE OWNER ON
THE SECOND PAGE OF THIS APPLICATION IS THE OWNER'S CORRECT TAXPAYER
IDENTIFICATION NUMBER (OR THE OWNER IS WAITING FOR A NUMBER TO BE ISSUED) AND
(2) THE OWNER IS NOT SUBJECT TO BACKUP WITHHOLDING EITHER BECAUSE THE OWNER
HAS NOT BEEN NOTIFIED BY THE INTERNAL REVENUE SERVICE (IRS) THAT THE OWNER IS
SUBJECT TO BACKUP WITHHOLDING AS A RESULT OF A FAILURE TO REPORT ALL INTEREST
OR DIVIDENDS, OR THE IRS HAS NOTIFIED THE OWNER THAT THE OWNER IS NO LONGER
SUBJECT TO BACKUP WITHHOLDING. (SEE TAXPAYER IDENTIFICATION NUMBER
INSTRUCTIONS.)
THE INTERNAL REVENUE SERVICE DOES NOT REQUIRE YOUR CONSENT TO ANY PROVISION
OF THIS DOCUMENT OTHER THAN THE CERTIFICATIONS REQUIRED TO AVOID BACKUP
WITHHOLDING.
-------------------------------------------------------------------------------
THE SIGNATURES BELOW APPLY TO THE APPLICATION, THE POLICY APPLICATION
SUPPLEMENT AND THE CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER.
<TABLE>
<CAPTION>
<S> <C>
(Signed) John J. Doe (Signed) Jane J. Doe
- -------------------------------------- -----------------------------------------
Signature of FIRST INSURED Signature of SECOND INSURED
(Signed) John J. Doe
- -------------------------------------- -----------------------------------------
Signature of APPLICANT Signature of OWNER (If other than
Applicant, First or Second Insured)
Signed by APPLICANT at Milwaukee, Milwaukee WI Date signed by APPLICANT 12 | 31 | 1998
------------------------ ----------------
CITY, COUNTY & STATE MONTH DAY YEAR
(Signed) Norm W. Western
------------------------------
Signature of LICENSED AGENT
</TABLE>
- --------------------------------------------------------------------------------
INSTRUCTIONS FOR TAXPAYER IDENTIFICATION NUMBER INFORMATION
1. Under federal income tax law you will be subject to a withholding tax of
31% imposed upon certain reportable payments, if any, and to certain
penalties if you do not certify under penalties of perjury that the
Taxpayer Identification Number which you have provided us is correct and
that you are not subject to backup withholding due to notified payee
underreporting. Generally speaking, for individuals, the Taxpayer
Identification Number is the Social Security Number.
2. If you don't have a Taxpayer Identification Number, obtain Form SS-5,
Application for a Social Security Number Card, at the local office of the
Social Security Administration or the Internal Revenue Service and apply for
a number. Write "Applied for" in the space available for your Taxpayer
Identification Number on the first page of this application. If we do not
receive your Taxpayer Identification Number within 60 days, we are required
to withhold 31% of all reportable payments, if any, thereafter made to you
until we receive a number from you.
3. If the Internal Revenue Service has notified you that you are subject to
backup withholding and you have not received notice from the Service that
backup withholding has terminated, you should strike out the language on
page 9 that you are not subject to backup withholding due to notified payee
underreporting.
90-1 JCL (0918) (page 7)
<PAGE>
POLICY APPLICATION SUPPLEMENT FOR
FLEXIBLE PREMIUM VARIABLE JOINT LIFE INSURANCE POLICY
INSURANCE PAYABLE ON SECOND DEATH
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
720 East Wisconsin Avenue
Milwaukee, Wisconsin 53202
INSUREDS: John J. Doe and Jane J. Doe
-------------------- ----------------------
POLICY:
Specified Amount: $ 1,000,000
--------------------------------------------
Death Benefit Option: Specified Amount (Option A)
--------------------------------------------
Definition of Life Insurance Test: Guideline Premium/Cash Value Corridor Test
--------------------------------------------
Minimum Initial Premium: $ 5,000
--------------------------------------------
Guideline Premium Maximum: $ 8,960
--------------------------------------------
Reminder Premium: $ 5,000
--------------------------------------------
Reminder Mode: Annual
--------------------------------------------
- --------------------------------------------------------------------------------
For Home Office Use Only
Underwriting Amount: $ 1,000,000
-----------
Illustrated Cumulative Premiums:
Years 1- 5: $ 25,000 Years 1- 15: $ 75,000
---------- -----------
Years 1- 10: $ 50,000 Years 1- 20: $ 100,000
---------- -----------
First Insured: 35, Male, Select Second Insured: 35 Female Select
------------------------- -------------------
WI
- -------
- --------------------------------------------------------------------------------
Illustration No. 123-456-789
90-1 VJL. Supp. (1298) Page 1 of 4 ------------------
<PAGE>
ALLOCATION OF NET PREMIUMS
This allocation will apply to all net premiums and loan repayments. USE WHOLE
PERCENTAGES ONLY. If monthly dollar cost averaging is desired, complete both
this section and the monthly dollar cost averaging section below. Only
allocations to the Money Market Division are utilized for dollar cost averaging
purposes.
Money Market Division %
----------
Aggressive Growth Stock Division %
----------
Balanced Division %
----------
Growth and Income Stock Division %
----------
Growth Stock Division %
----------
High Yield Bond Division %
----------
Index 500 Stock Division %
----------
International Equity Division %
----------
Select Bond Division %
----------
Total 100 %
----------
MONTHLY DOLLAR COST AVERAGING
To elect monthly dollar cost averaging, choose one of the following options and
indicate the desired allocation of transfers below. USE WHOLE PERCENTAGES ONLY.
_____Option One: Transfer in monthly installments so that on the policy
anniversary the Money Market balance will be zero.
_____Option Two: Transfer a level amount of $______________until the Money
Market balance is zero.
Aggressive Growth Stock Division %
----------
Balanced Division %
----------
Growth and Income Stock Division %
----------
Growth Stock Division %
----------
High Yield Bond Division %
----------
Index 500 Stock Division %
----------
International Equity Division %
----------
Select Bond Division %
----------
Total 100 %
----------
Insureds: John J. Doe and
----------------
Jane J. Doe
----------------
Illustration No. 123-456-789
-------------------
90-1 VJL. Supp. (1298) Page 2 of 4
<PAGE>
SUITABILITY
Northwestern Mutual Life is required to make the following inquiries for
purposes of determining the suitability of this purchase. Responses will be kept
confidential.
1. In addition to providing a death benefit upon the death of the second of the
Insureds, what is the purpose for the purchase?
To fund a trust. Purpose of the trust:
- ----- ------------------------------------
To supplement retirement income
- -----
To supplement education funding
- -----
Other (specify):
- ----- ---------------------------------------------------------
2. By whom will the purchase be funded?
-----------------------------------------
Annual income (all sources) of person/trust funding the purchase:$
---------
Net worth of person/trust funding the purchase: $
--------------------------
3. Applicant's experience with the following:
(If the purpose for the purchase is to fund a trust, describe the trust's or
trustee's experience)
None Up to 5 or More
5 Years Than 5 Years
Mutual Funds
------ ------ ------
Individual Common Stocks
------ ------ ------
Bonds
------ ------ ------
Variable Annuities
------ ------ ------
Variable Life Insurance
------ ------ ------
4. Describe the information the applicant has provided regarding his/her
portfolio, tax status and variable life insurance purchase objectives and needs
(if the purpose for the purchase is to fund a trust, describe the information
the trust has provided regarding its portfolio, tax status and variable life
insurance purchase objectives and needs):
Insureds: John J. Doe and
----------------
Jane J. Doe
----------------
Illustration No. 123-456-789
-------------------
90-1 VJL. Supp. (1298) Page 3 of 4
<PAGE>
I UNDERSTAND THAT THE DEATH BENEFIT FOR A FLEXIBLE PREMIUM VARIABLE JOINT LIFE
POLICY IS VARIABLE AND MAY INCREASE OR DECREASE TO REFLECT THE INVESTMENT
EXPERIENCE OF NORTHWESTERN MUTUAL VARIABLE LIFE ACCOUNT. THE AMOUNT OF THE DEATH
BENEFIT IS NOT GUARANTEED.
I UNDERSTAND THAT THE CASH VALUE FOR A FLEXIBLE PREMIUM VARIABLE JOINT LIFE
POLICY IS VARIABLE AND MAY INCREASE OR DECREASE TO REFLECT THE INVESTMENT
EXPERIENCE OF NORTHWESTERN MUTUAL VARIABLE LIFE ACCOUNT. THE AMOUNT OF THE CASH
VALUE IS NOT GUARANTEED.
I understand that any illustrations of death benefits and cash values I have
been shown demonstrate how the policy operates under a given set of assumptions
and are not estimates or guarantees of future results. Actual experience will be
different than assumed, resulting in death benefits and cash values higher or
lower than illustrated. The assumptions incorporated in an illustration include,
but are not limited to, the following: premium payment amounts and frequencies,
investment returns, expense charges, cost of insurance charges, loans, and
withdrawals.
I acknowledge receipt of the _____/_____/_____ Flexible Premium Variable
MO. DAY YR.
Joint Life Insurance Policy prospectus.
DATE: 12 / 31 / 98 SIGNATURE OF APPLICANT: (Signed) John J. Doe
---- ---- ---- ---------------------------
MO. DAY YR.
Based on the information furnished by the Applicant in this application, I
certify that I have reasonable grounds for believing the purchase of the policy
applied for is suitable for the Applicant. I further certify that a current
prospectus was delivered and that no written sales materials other than those
furnished by the Northwestern Mutual Life home office were used.
Signature of Licensed Agent: (Signed) Norm W. Western
----------------------------------------------------
(REGISTERED REPRESENTATIVE)
Based on the information furnished by the applicant in this application, I
certify that I have reasonable grounds for believing the purchase of the policy
applied for is suitable for the Applicant.
Signature of General Agent: (Signed) Norma W. Western
-----------------------------------------------------
Insureds: John J. Doe and
----------------
Jane J. Doe
----------------
Illustration No. 123-456-789
-------------------
90-1 VJL. Supp. (1298) Page 4 of 4
<PAGE>
It is recommended that you ...
read your policy.
notify your Northwestern Mutual agent or the Company at 720 East Wisconsin
Avenue, Milwaukee, WI 53202, of an address change.
call your Northwestern Mutual agent for information--particularly on a
suggestion to terminate or exchange this policy for another policy or plan.
ELECTION OF TRUSTEES
The members of The Northwestern Mutual Life Insurance Company are its
policyholders of insurance policies and deferred annuity contracts. The members
exercise control through a Board of Trustees. Elections to the Board are held
each year at the annual meeting of members. Members are entitled to vote in
person or by proxy.
FLEXIBLE PREMIUM VARIABLE JOINT LIFE INSURANCE POLICY
INSURANCE PAYABLE ON SECOND DEATH
ELIGIBLE FOR ANNUAL DIVIDENDS
Flexible premiums.
Benefits reflect investment results.
Variable benefits described in Sections 1, 3, 6, 7 and 8.
THE DEATH BENEFIT AND CASH VALUE UNDER THIS POLICY ARE VARIABLE. THEY MAY
INCREASE OR DECREASE DAILY DEPENDING ON THE INVESTMENT RESULTS OF THE SEPARATE
ACCOUNT. THE AMOUNT OF THE DEATH BENEFIT AND THE AMOUNT OF THE CASH VALUE ARE
NOT GUARANTEED.
RR.VJL.(1298)
<PAGE>
POLICY SPLIT PROVISION
POLICY SPLIT RIGHT. While both Insureds are alive, the Owner may exchange this
policy for two policies (the "new policies"), one on the life of each Insured,
if there is a change in federal estate tax law which results in either:
a. the repeal of the unlimited marital deduction provision; or
b. at least a 50% reduction in the maximum percentage rate set forth in
the federal estate tax schedule in effect on the Date of Issue of this
policy.
This exchange may be made without evidence of insurability.
CONDITIONS. The exchange may be made by meeting any conditions set by the
Company, including the following:
a. the Company must receive a written request from the Owner no more than
180 days after the earlier of the date of enactment of the law
repealing the unlimited marital deduction or the date of enactment of
the law reducing the maximum percentage rate of federal estate tax by
50%; and
b. any required costs are paid.
TERMS OF THE NEW POLICIES. The new policies will be issued on any life
insurance plan agreed to by the Owner and the Company. The new policies will
have the same Date of Issue and Policy Date as this policy. The new policies
will take effect on the date the written request to exchange this policy for the
new policies is received at the Home Office. This policy will terminate when
the new policies take effect.
The amount of the death benefit of each new policy will be one-half the
amount of the death benefit of this policy. The Policy Value of this policy
will be allocated to each new policy as determined appropriate by the Company.
Any policy debt will be divided between the new policies in proportion to their
cash values. Any assignment will continue on the new policies.
SECRETARY
THE NORTHWESTERN
MUTUAL LIFE
INSURANCE COMPANY
RR.VJL.PS.(1298)
HOL03 105423
<PAGE>
EXHIBIT A(6)(b)
BY-LAWS
OF
THE NORTHWESTERN MUTUAL
LIFE INSURANCE COMPANY
MILWAUKEE, WISCONSIN
(Appendix--Restated Articles of Incorporation)
As amended
JANUARY 28, 1998
<PAGE>
BY-LAWS
OF
THE NORTHWESTERN MUTUAL
LIFE INSURANCE COMPANY
AS AMENDED
JANUARY 28, 1998
TABLE OF CONTENTS Page
ARTICLE I--Meetings of Members; Voting by Members; Nominations
of Board Candidates
Section 1.1 Annual Meetings. . . . . . . . . . . . . . . . . . . . . 1
Section 1.2 Special Meetings . . . . . . . . . . . . . . . . . . . . 1
Section 1.3 Place of Meetings. . . . . . . . . . . . . . . . . . . . 1
Section 1.4 Notice of Meetings . . . . . . . . . . . . . . . . . . . 1
Section 1.5 Quorum . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 1.6 Voting . . . . . . . . . . . . . . . . . . . . . . . . . 2
(a) Procedures. . . . . . . . . . . . . . . . . . . . . 2
(b) Furnishing Proxies and Other Materials. . . . . . . 2
(c) Effect of Furnishing Proxies. . . . . . . . . . . . 2
(d) Voting Inspectors . . . . . . . . . . . . . . . . . 2
(e) Tabulation of Voting. . . . . . . . . . . . . . . . 2
(f) Certificate of Election . . . . . . . . . . . . . . 3
Section 1.7 Voting Rights. . . . . . . . . . . . . . . . . . . . . . 3
(a) Record Date . . . . . . . . . . . . . . . . . . . . 3
(b) Number of Votes . . . . . . . . . . . . . . . . . . 3
(c) Eligibility . . . . . . . . . . . . . . . . . . . . 3
Section 1.8 Nominations of Candidates for the Board. . . . . . . . . 3
(a) Filing of Board's Proposed Nominees . . . . . . . . 3
(b) Substitution. . . . . . . . . . . . . . . . . . . . 4
i
<PAGE>
(c) Nomination at Meeting . . . . . . . . . . . . . . . 4
Section 1.9 Inspection of Records. . . . . . . . . . . . . . . . . . 4
ARTICLE II--Board of Trustees and Committees
Section 2.1 General Powers . . . . . . . . . . . . . . . . . . . . . 4
Section 2.2 Composition. . . . . . . . . . . . . . . . . . . . . . . 4
(a) Number and Tenure . . . . . . . . . . . . . . . . . 4
(b) Classification. . . . . . . . . . . . . . . . . . . 5
(c) Retirement. . . . . . . . . . . . . . . . . . . . . 5
Section 2.3 Qualifications . . . . . . . . . . . . . . . . . . . . . 5
(a) Citizenship, Age, Other Offices . . . . . . . . . . 5
(b) Non-attendance. . . . . . . . . . . . . . . . . . . 5
Section 2.4 Committees of the Board. . . . . . . . . . . . . . . . . 6
Section 2.5 Executive Committee. . . . . . . . . . . . . . . . . . . 6
(a) Composition and Powers. . . . . . . . . . . . . . . 6
(b) Records . . . . . . . . . . . . . . . . . . . . . . 6
Section 2.6 Finance Committee. . . . . . . . . . . . . . . . . . . . 6
(a) Composition and Powers. . . . . . . . . . . . . . . 6
(b) Records . . . . . . . . . . . . . . . . . . . . . . 7
Section 2.7 Vacancies. . . . . . . . . . . . . . . . . . . . . . . . 7
Section 2.8 Alternate Members on Standing Committees
of the Board . . . . . . . . . . . . . . . . . . . . . . 7
(a) Election. . . . . . . . . . . . . . . . . . . . . . 7
(b) Compensation. . . . . . . . . . . . . . . . . . . . 7
Section 2.9 Compensation of Trustees . . . . . . . . . . . . . . . . 7
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ARTICLE III--Meetings of the Board and Committees of the Board
Section 3.1 Regular Meetings . . . . . . . . . . . . . . . . . . . . 8
Section 3.2 Special Meetings . . . . . . . . . . . . . . . . . . . . 8
Section 3.3 Quorum . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 3.4 Manner of Acting . . . . . . . . . . . . . . . . . . . . 8
Section 3.5 Notice of Special Meetings . . . . . . . . . . . . . . . 8
Section 3.6 Waiver of Notice . . . . . . . . . . . . . . . . . . . . 8
Section 3.7 Action Without a Meeting . . . . . . . . . . . . . . . . 9
ARTICLE IV--Executive and Other Officers
Section 4.1 Executive Officers . . . . . . . . . . . . . . . . . . . 9
Section 4.2 Powers and Duties of Executive Officers. . . . . . . . . 9
Section 4.3 Other Officers . . . . . . . . . . . . . . . . . . . . .10
Section 4.4 Vacancies and Absences . . . . . . . . . . . . . . . . .10
Section 4.5 Compensation . . . . . . . . . . . . . . . . . . . . . .10
Section 4.6 Election and Appointment of Officers . . . . . . . . . .10
ARTICLE V--Examining Committee
Section 5.1 Selection of the Examining Committee . . . . . . . . . .10
Section 5.2 Functions of the Examining Committee . . . . . . . . . .11
ARTICLE VI--Official Bonds; Checks; Other Instruments
Section 6.1 Official Bonds . . . . . . . . . . . . . . . . . . . . .11
Section 6.2 Checks . . . . . . . . . . . . . . . . . . . . . . . . .11
Section 6.3 Insurance Policies and Annuity Contracts . . . . . . . .11
Section 6.4 Derivative Investment Instruments. . . . . . . . . . . .11
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Section 6.5 Other Investment Instruments . . . . . . . . . . . . . .11
Section 6.6 Other Instruments. . . . . . . . . . . . . . . . . . . .12
Section 6.7 Attestation. . . . . . . . . . . . . . . . . . . . . . .12
ARTICLE VII--Indemnification
Section 7.1 Indemnification of Trustees, Officers and Employees. . .12
(a) Successful Defense. . . . . . . . . . . . . . . . .12
(b) Other Cases . . . . . . . . . . . . . . . . . . . .12
Section 7.2 Determination of Right to Indemnification. . . . . . . .13
Section 7.3 Allowance of Expenses as Incurred. . . . . . . . . . . .13
Section 7.4 Additional Rights to Indemnification and Allowance
of Expenses. . . . . . . . . . . . . . . . . . . . . . .14
Section 7.5 Insurance. . . . . . . . . . . . . . . . . . . . . . . .14
Section 7.6 General. . . . . . . . . . . . . . . . . . . . . . . . .14
ARTICLE VIII--Emergency Provisions
Section 8.1 Continuity of Management . . . . . . . . . . . . . . . .15
(a) Acting President. . . . . . . . . . . . . . . . . .15
(b) Powers of Acting President. . . . . . . . . . . . .15
(c) Executive Committee . . . . . . . . . . . . . . . .15
(d) Committee Quorum. . . . . . . . . . . . . . . . . .15
(e) Board Quorum. . . . . . . . . . . . . . . . . . . .15
ARTICLE IX--Offices
Section 9.1 Offices. . . . . . . . . . . . . . . . . . . . . . . . .16
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ARTICLE X--Corporate Seal
Section 10.1 Corporate Seal . . . . . . . . . . . . . . . . . . . . .16
ARTICLE XI--Amendments
Section 11.1 Amendment or Repeal of the By-laws . . . . . . . . . . .16
(a) By Members. . . . . . . . . . . . . . . . . . . . .16
(b) By Board. . . . . . . . . . . . . . . . . . . . . .16
APPENDIX--Restated Articles of Incorporation . . . . . . . . . . . . . . . .18
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BY-LAWS
OF
THE NORTHWESTERN MUTUAL
LIFE INSURANCE COMPANY
AS AMENDED
JANUARY 28, 1998
ARTICLE I
MEETINGS OF MEMBERS; VOTING BY MEMBERS;
NOMINATIONS OF BOARD CANDIDATES
Section 1.1. ANNUAL MEETINGS.
An annual meeting of the members of the Company shall be held at such time
during normal business hours as may be fixed by the board of trustees (the
"board") or executive committee for the purpose of electing trustees and for the
transaction of such other business as may come before the meeting. The board or
executive committee may postpone the date of the annual meeting for not more
than 60 days, but such postponement shall not change the record date for such
annual meeting.
Section 1.2 SPECIAL MEETINGS.
A special meeting of members may be called by the president, the board, the
executive committee or members having 5% of the votes entitled to be cast at
such meeting.
Section 1.3 PLACE OF MEETINGS.
The board may designate any place, either within or without the State of
Wisconsin, as the place of any annual meeting or of any special meeting called
by the board. If no designation is made or if a special meeting is otherwise
called, the place of meeting shall be the principal office of the Company.
Section 1.4 NOTICE OF MEETINGS.
Notice of the time and place of an annual or special meeting shall be
published once in each of 2 weeks, the first publication to be not more than 120
and the second publication to be not less than 10 days prior to the date of the
meeting, in at least 2 newspapers of general circulation, one published in the
City of Madison, Wisconsin, and one published in the City of Milwaukee,
Wisconsin, and in such other newspapers, if any, as the board or executive
committee may determine. Written notice of the time and place of an annual or
special meeting shall also be given by mailing a copy thereof, not more than 120
nor less than 10 days prior to the date of the meeting, to the policyholders
constituting substantially all of the members entitled to vote at the meeting.
In the case of a special meeting or when required by law, the published and
mailed notice of meeting shall include a statement of the purpose or purposes
for which the meeting is to be held. In case the date of the annual meeting is
postponed after published and mailed notices have begun, a published notice of
the postponement shall be made as in the case of the initial published notice
but no mailed notice of the postponement need be given.
Section 1.5 QUORUM.
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Members having at least 5% of the votes entitled to be cast at any meeting,
present in person or by proxy at such meeting, shall constitute a quorum at such
meeting. If a quorum is not present at any meeting, a majority of the members
present may adjourn the meeting from time to time without further notice.
Section 1.6 VOTING.
(a) PROCEDURES. All voting by members at annual and special meetings
shall be in person or by proxy executed in writing by the member or
his duly authorized attorney-in-fact and delivered to the secretary of
the Company on or before a day specified in the notice of meeting
which shall be at least 5 days prior to the date of the meeting. A
majority of the votes entitled to be cast by the members present in
person or by proxy at a meeting at which a quorum is present shall be
sufficient for the election of any trustee or for the adoption of any
other matter voted on at such meeting unless a greater portion is
required by law. Unless sooner revoked, proxies shall be valid for 11
months from the date of execution and for such additional period, if
any, as may be provided therein.
(b) FURNISHING PROXIES AND OTHER MATERIAL. The Company may include the
notice of meeting pursuant to Section 1.4 with or as a part of its
annual report for the preceding year or may send such notice
separately. The Company may provide proxies to any or all of the
members together with such information as the Company deems pertinent
with respect to the candidates or matters being voted upon at the
meeting.
(c) EFFECT OF FURNISHING PROXIES. The fact that the Company, by mail or
otherwise, furnishes a proxy to any person shall not constitute nor be
construed as an admission of the validity of any policy or contract or
that such person is a member entitled to vote at the meeting; and such
fact shall not be competent evidence in any action or proceeding in
which the validity of any policy or contract or any claim under it is
at issue.
(d) VOTING INSPECTORS. Prior to each meeting of members the board shall
appoint, from among members who are not trustees, candidates for
trustee, officers, employees or agents of the Company, 1 or more
voting inspectors and shall fix their fees. If an inspector so
appointed is unable or unwilling to act the chief executive officer
may appoint a substitute from among members eligible as aforesaid.
The Company shall provide such clerical and mechanical assistance to
the inspectors as they may reasonably require and shall pay the fees
and reasonable expenses of the inspectors.
(e) TABULATION OF VOTING. All voting at a meeting of members, including
voting by holders of proxies, shall be by written ballot. The votes
shall be tabulated by the voting inspectors and shall be subject to
such
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verification and ascertainment of the validity thereof and of the
qualification of the voters as the inspectors deem appropriate. The
inspectors may employ such mechanical equipment as they deem advisable
to assist in the tabulation. In the absence of challenge the
inspectors may assume that the signature appearing on a proxy or
ballot is the valid signature of a member entitled to vote, that any
person signing in a representative capacity is duly authorized so to
do, and that the proxy, if not older than permitted thereby, is valid.
After the tabulation has been completed, all proxies and ballots shall
be placed in sealed packages and preserved by the secretary of the
Company for at least 4 months from the date of the meeting.
(f) CERTIFICATE OF ELECTION. Promptly after each meeting of members the
inspectors shall sign and file with the secretary of the Company and
the Wisconsin Commissioner of Insurance a certificate of the results
of the voting at such meeting.
Section 1.7 VOTING RIGHTS.
(a) RECORD DATE. Only those persons who are members of the Company at the
close of business on the record date for a meeting of members shall be
entitled to vote at such meeting. The record date for an annual or
special meeting shall be such business day not more than 120 days
prior to the date of the meeting as may be established by the board or
executive committee.
(b) NUMBER OF VOTES. Each member shall be entitled to one vote on each
matter presented at a meeting for a vote by members, regardless of the
number or amount of, or the number of lives insured by, policies or
contracts owned by such member.
(c) ELIGIBILITY. All questions concerning the eligibility of members to
vote and the validity of the votes cast at any meeting shall be
determined by the voting inspectors on the basis of the records of the
Company. If a question concerning eligibility to vote arises as
between a person identified as the owner of the policy or contract on
the records of the Company and a person otherwise claiming to control
such policy or contract, the person shown on the records of the
Company as the owner at the close of business on the record date for
the meeting shall be deemed to be the member entitled to vote at such
meeting.
Section 1.8 NOMINATIONS OF CANDIDATES FOR THE BOARD.
(a) FILING OF BOARD'S PROPOSED NOMINEES. Before each annual meeting of
members, the board shall propose for nomination at such meeting a
member as candidate for every vacancy on the board to be filled at the
ensuing annual meeting as provided in Section 2.2 and shall cause to
be filed with the records of the Company and the Wisconsin
Commissioner of Insurance a certificate of such proposed nomination
signed by the secretary of the Company, giving the names,
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occupations and addresses of such proposed nominees and the terms for
which they are to be nominated and stating that such proposed nominees
meet the eligibility requirements then pertaining to trustees
prescribed by Section 2.3(a) and will accept office if elected.
(b) SUBSTITUTION. In the event any candidate proposed by the board for
nomination pursuant to Section (a) above withdraws as a candidate
prior to the annual meeting, the board may propose a member for
nomination in substitution for the withdrawing candidate and shall
make such filings as are required pursuant to Section (a) above
promptly after such substitution.
(c) NOMINATION AT MEETING. Subject to Section 2.3(a), nominations of
members as candidates for any vacancy on the board to be filled at an
annual meeting of members, including nomination of the board's
proposed nominees, shall be made at the meeting; and such nomination
may be made by any member who is present in person or by proxy and is
entitled to vote at such meeting.
Section 1.9 INSPECTION OF RECORDS.
The Company shall keep on file after the record date for each meeting and
until the tabulation of voting at such meeting has been completed, a record for
voting purposes of the names and addresses of the persons shown as the premium
payers as of the close of business on such record date with respect to the
policies and contracts of the members. Subject to provisions of the Wisconsin
Statutes and with due regard to the Company's status as an insurance company and
financial institution, a member, or his agent or attorney, may inspect such
record at any reasonable time for the purpose of communicating with other
members in regard to nomination or election of candidates for the board or any
other matter being submitted for vote at a meeting of the members. No person
may, directly or indirectly, use any information obtained from any such
inspection for any other purpose, and the Company may impose reasonable rules to
insure that such information is not used for any other purpose.
ARTICLE II
BOARD OF TRUSTEES AND COMMITTEES
Section 2.1 GENERAL POWERS.
The business and affairs of the Company shall be managed by the board.
Section 2.2 COMPOSITION.
(a) NUMBER AND TENURE. The number of trustees of the Company shall be not
more than 30 or if permitted by law such other number, not less than
9, as the board may establish from time to time. The regular term of
office of a trustee shall commence immediately after the annual
meeting of members at which such trustee is elected and end on the
date of the fourth succeeding annual meeting of members. The
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vacancies on the board to be filled at each annual meeting of members
shall be the offices of those trustees whose regular terms are
scheduled to expire on the date of such meeting and the offices of any
other trustees that become vacant during the 12 months ending on the
January 1 preceding such meeting. All elections shall be for the
regular term except those to fill the offices of trustees that become
vacant during the 12 months ending on the January 1 preceding such
meeting which shall be for the unexpired regular term of such vacant
offices. Except as provided in paragraph (c), each trustee elected at
an annual meeting shall hold office for the term for which elected and
until his successor has been elected or appointed and qualified.
(b) CLASSIFICATION. Trustees shall be divided into 4 classes, which may
but need not be equal, according to the expiration date of the regular
terms of offices. The regular term of office of one of the classes of
trustees shall expire on the date of each annual meeting of members.
On July 26, 1972, the 4 classes of trustees shall be those whose
regular terms are scheduled to expire on the date of the annual
meeting of members in 1973, 1974, 1975 and 1976, respectively.
(c) RETIREMENT. The board may by resolution provide for mandatory
retirement of trustees and members of the committees of the board. A
trustee or member of a committee of the board shall be retired on the
date provided in the resolution even though elected for a term
extending beyond such date.
Section 2.3 QUALIFICATIONS.
(a) CITIZENSHIP, AGE, OTHER OFFICES. Only those members of the Company
shall be eligible to be nominated or elected or to serve as a trustee
who are citizens of the United States of America, are not less than 25
years of age nor more than the retirement age, if any, as then
established by resolution of the board pursuant to Section 2.2(c), are
not ineligible under paragraph (b) and have no relationship which
would create a conflict of interest or impair independence of judgment
in regard to the affairs of the Company in violation of the rules then
prescribed by the board or executive committee. Except for the
chairman of the board, the president and 2 other executive officers,
no trustee shall be an executive officer, officer, other employee or
agent of the Company.
(b) NON-ATTENDANCE. The failure of a trustee to attend at least 1 meeting
of the board within a period of 9 consecutive calendar months shall
thereupon result in an automatic forfeiture of his office, unless such
forfeiture is avoided as provided below; and such trustee shall not be
eligible to be nominated or elected or to serve as a trustee until at
least 6 months have elapsed following such forfeiture. Any such
forfeiture shall result in a vacancy to be filled as in the case of
other vacancies on the board. A trustee may avoid such forfeiture if
during
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said 9 month period he attends a meeting of the executive committee
even though not a member of that committee, but no trustee may so
avoid forfeiture more than once during the term he is then serving
without the express approval of the executive committee.
Section 2.4 COMMITTEES OF THE BOARD.
The standing committees of the board shall be an executive committee and a
finance committee and such other standing committees as the board may establish
and designate as such. The board may from time to time establish such other
committees as it deems advisable; and the members of such other committees shall
be appointed by or in the manner provided by the board. Any trustee may attend
and participate in any meeting of a standing committee of the board, except that
no trustee who is not a member of or an alternate on a standing committee may
vote upon any matter before such committee.
Section 2.5 EXECUTIVE COMMITTEE.
(a) COMPOSITION AND POWERS. The executive committee shall consist of such
number of trustees as the board may determine, to be elected annually
by the board, plus the chairman of the board, if any, and the
president, if a trustee. When the board is not in session, the
executive committee shall have and may exercise all of the powers of
the board except (i) the powers granted to the finance committee by
Section 2.6, (ii) the power to adopt, amend or repeal by-laws, (iii)
the power to elect a chairman of the board, president or other
executive officer, and (iv) the power to fill vacancies in the board
or any of its standing committees or, except as provided in Section
4.4, in the office of chairman of the board, president or other
executive officer.
(b) RECORDS. The executive committee shall keep a record of its
transactions which record shall be made available to each member of
the board, and so much thereof shall be read at the next regular
meeting of the board as it may order.
Section 2.6 FINANCE COMMITTEE.
(a) COMPOSITION AND POWERS. The finance committee shall consist of such
number of trustees as the board may determine, to be elected annually
by the board, plus the chairman of the board, if any, and the
president, if a trustee. When the board is not in session, the
finance committee shall have and may exercise all of the powers of the
board in regard to the assets and investments of the Company (except
assets used in the operation of the Company's principal office and
agencies) including, without limitation, the power directly or by
delegation to do all such acts and things as it may deem necessary and
proper to (i) establish the Company's financial and investment policy,
(ii) invest, reinvest, manage, select, sell and otherwise dispose of
the Company's assets, (iii) designate depositories for the Company's
funds and authorize persons to make deposits in and withdrawals from
such depositories, (iv) appoint one or more managers of the Company's
regional loan and
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real estate offices, (v) borrow money for the use and benefit of the
Company in such amount and on such terms as it shall determine, and
(vi) pledge the Company's assets as security for the payment of such
loans or other proper purposes.
(b) RECORDS. The finance committee shall keep a record of its
transactions which record shall be made available to each member of
the board and all standing committees of the board and so much thereof
shall be read at the next regular meeting of the board as it may
order.
Section 2.7 VACANCIES.
Vacancies in the board or any committee of the board may be filled by the
board at any meeting. A person appointed to fill a vacancy in the board shall
hold office until the next annual meeting of members and until his successor has
been elected or appointed and qualified, except that any person appointed to
fill any such vacancy occurring after January 1 of any year but prior to the
next following meeting of members shall hold office until the second annual
meeting of members following his appointment and until his successor has been
elected or appointed and qualified. A person appointed to fill a vacancy on a
committee shall hold office until the next annual meeting of the board.
Section 2.8 ALTERNATE MEMBERS ON STANDING COMMITTEES OF THE BOARD.
(a) ELECTION. The board shall elect annually trustees to serve as
alternate members on any standing committee of the board, when so
designated by the committee or the chairman of the board or the
president to take the place of absent members, or to fill vacancies on
such committees until the next meeting of the board.
(b) COMPENSATION. An alternate member on any committee shall receive,
during his period of service, compensation as fixed by the board. The
board may determine by a generally applicable resolution to what
extent, if any, the compensation of absent members shall be withheld
or reduced during the period of service of alternates.
Section 2.9 COMPENSATION OF TRUSTEES.
By resolution of the board, each trustee may be paid his reasonable
expenses, if any, for attendance at each meeting of the board and its committees
and, if not an executive officer, may be paid a stated compensation as trustee
and committee member or a fixed sum for attendance at each meeting of the board
or its committees or both. Such payment shall not prevent the payment of
reasonable compensation to a trustee (other than an executive officer) for the
authorized performance of professional, appraisal, or other technical or special
service outside the scope of his regular duties as trustee or member of a
committee.
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ARTICLE III
MEETINGS OF THE BOARD AND
COMMITTEES OF THE BOARD
Section 3.1 REGULAR MEETINGS.
An annual meeting of the board for the election of standing committees and
the officers specified in Section 4.6(a), and the transaction of such other
business as may properly come before the meeting, shall be held annually at such
time and place, either within or without the State of Wisconsin, as designated
by resolution of the board and upon such notice as the board may determine.
Additional regular meetings of the board and regular meetings of a committee may
be held at such times and places and upon such notice as the board or committee
may determine.
Section 3.2 SPECIAL MEETINGS.
Special meetings of the board or a committee may be called at any time by
or at the request of the chairman of the board or the president, and in
addition, special meetings of the board may be called at any time by or at the
request of the executive committee or 9 or more trustees.
Section 3.3 QUORUM.
A quorum for the transaction of business at any meeting of the board or any
committee shall consist of a majority of the board or of the committee, except
that a quorum for a committee composed of an even number of persons shall
consist of 50% of the committee. Less than a quorum may adjourn the meeting
from time to time until a quorum is present.
Section 3.4 MANNER OF ACTING.
The act of a majority of the board or a committee present at a meeting at
which a quorum is present shall be the act of the board or committee, unless the
board or the committee determines a greater number is required.
Section 3.5 NOTICE OF SPECIAL MEETINGS.
Notice of special meetings of the board or a committee shall be given in
writing or by telegram to each trustee or committee member at his last known
address as it appears on the Company's records. Such notice shall be given at
least 6 days prior to the meeting date except in the case of finance and
executive committee meetings for which 2 days prior notice shall suffice. If
mailed, such notice shall be deemed to be given when deposited in the United
States mail, so addressed, with postage prepaid. If sent by telegram, such
notice shall be deemed to be given when the telegram is delivered to the
telegraph company. Neither the business to be transacted at, nor the purpose
of, any special meeting of the board or a committee need be specified in the
notice of such meeting except as provided in Section 11.1(b) in regard to
amendment or repeal of the By-laws.
Section 3.6 WAIVER OF NOTICE.
Any notice of the time or place of any special meeting of the board or a
committee may be dispensed with if every member of the board or committee
attends such meeting or if at any time every absent member of the board or
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committee signs a written waiver of notice or waives notice by telegram.
Neither the business to be transacted at, nor the purpose of, any meeting of the
board or committee need be specified in the waiver of such meeting.
Section 3.7 ACTION WITHOUT A MEETING.
Any action required or permitted to be taken at a meeting by the board or a
committee may be taken without a meeting if a consent in writing, setting forth
the action so taken, is signed by every member of the board or committee.
ARTICLE IV
EXECUTIVE AND OTHER OFFICERS
Section 4.1 EXECUTIVE OFFICERS.
The executive officers of the Company shall consist of a president and such
other executive officers with such titles, powers and duties as may be
prescribed from time to time by the board. The board may from time to time
elect from among its members a chairman of the board, who shall be an executive
officer of the Company with such powers and duties as may be prescribed by the
board. Any 2 or more offices may be held by the same person except the offices
of president and secretary and the offices of president and vice president. The
executive officers shall hold office during the pleasure of the board. For the
purposes of the Wisconsin Statutes the principal officers shall be the chairman
of the board, if any, the president and the other executive officers. There
shall be at all times at least 3 principal officers.
Section 4.2 POWERS AND DUTIES OF EXECUTIVE OFFICERS.
The chairman of the board, if any, shall be chairman of and preside at the
meetings of the members and of the board and shall exercise such other powers
and perform such other duties as may be required by the board. In the absence
of action by the board vesting such powers in the chairman of the board, the
president shall be the chief executive officer and have the general direction
and management of the Company's affairs, and shall exercise such powers and
perform such duties as are incident to his office or as may be required of him
by the board or the executive or finance committees. The chief executive
officer, if a member of the Board, shall be chairman of and preside at the
meetings of the executive and finance committees. In the absence of, or if
there is no chairman of the board, the president shall preside at the meetings
of the members and, if a member of the board, at meetings of the board. All
other executive officers of the Company shall exercise such powers and perform
such duties as are usually incident to their office and such other duties,
including presiding at meetings of the members in the absence of the chairman of
the board and the president, as shall be assigned to or required of them, from
time to time, by the board, the executive committee, the finance committee or
the president or, if authorized by the board, the chairman of the board.
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Section 4.3 OTHER OFFICERS.
The other officers of the Company shall include a secretary, a treasurer
and such assistants to the several executive officers and such other officers as
the board or executive committee may from time to time designate as such, all of
whom shall hold office during the pleasure of the board or executive committee.
Any such officer may be designated an executive officer by the board or
executive committee. Each officer of the Company shall perform such duties as
may be assigned to or required of him from time to time, by the executive
committee, the finance committee, the president, the head of his department or,
if authorized by the board, the chairman of the board.
Section 4.4 VACANCIES AND ABSENCES.
Any vacancy in the office of chairman of the board, president or other
executive officers may be filled at any meeting of the board, or until the next
meeting of the board, by the executive committee. In the event of the death,
prolonged absence or inability or refusal to act of a chairman of the board who
has been designated by the board as the chief executive officer, the president
shall be the chief executive officer of the Company. In the prolonged absence
of the president or in the event of his death, inability or refusal to act, an
individual designated by the board or the executive committee shall exercise the
powers and perform the duties of the president. Such designation, if made by
the executive committee, shall not extend beyond the next meeting of the board.
Section 4.5 COMPENSATION.
Compensation of executive officers, officers and other employees of the
Company shall be fixed by or in the manner provided by the board.
Section 4.6 ELECTION AND APPOINTMENT OF OFFICERS.
Officers shall be elected or appointed from time to time, but at least
annually, as follows:
(a) The chairman of the board, if any, the president and other executive
officers shall be elected by the board.
(b) Other officers shall be appointed by the board or in a manner provided
by resolution of the board.
ARTICLE V
EXAMINING COMMITTEE
Section 5.1 SELECTION OF THE EXAMINING COMMITTEE.
An examining committee, consisting of not more than 5 or less than 3
individuals who are either members of the Company or whose lives are insured by
the Company, who are not trustees, agents, executive officers, officers or other
employees of the Company, shall be elected annually by the board, and the board
shall designate the chairman of such committee. Not more than 2 members of any
examining committee shall have been members of the previous examining
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committee. A vacancy in the examining committee may be filled at any time by
the board or one of its standing committees.
Section 5.2 FUNCTIONS OF THE EXAMINING COMMITTEE.
The purpose of the examining committee shall be to make an investigation of
and to inquire into the general policies, operations and management of the
Company. The committee shall have such powers as may be determined from time to
time by the board and shall make its reports to the board.
ARTICLE VI
OFFICIAL BONDS; CHECKS;
OTHER INSTRUMENTS
Section 6.1 OFFICIAL BONDS.
The board, the executive committee or the finance committee may require a
bond from any executive officer, officer, other employee or agent of the
Company, in such sum and with such sureties as it may deem proper.
Section 6.2 CHECKS.
Disbursement of the funds of the Company shall be made upon the check of
the Company signed by such persons and in such manner as may be determined by
the finance committee. Such persons as may be designated by the finance
committee shall each have authority to endorse checks and other instruments
received by the Company or to execute powers of attorney authorizing other
persons to make such endorsements.
Section 6.3 INSURANCE POLICIES AND ANNUITY CONTRACTS.
Insurance policies and annuity contracts issued by the Company and
endorsements thereto shall be executed in the manner provided by the board or
executive committee.
Section 6.4 DERIVATIVE INVESTMENTS INSTRUMENTS.
The chairman of the board, if any, the president and such other persons as
the board or finance committee may designate shall each have authority to
execute on the behalf of the Company all instruments regarding derivative
investments which are executed in the name of the Company.
Section 6.5 OTHER INVESTMENT INSTRUMENTS.
The chairman of the board, if any, the president, all vice presidents in
the investment departments, the vice president and investment counsel, the
general counsel and such other persons as the board or the finance committee may
designate shall each have authority (a) to execute on the behalf of the Company
all instruments regarding investments (other than derivative investments which
are to be executed as provided in Section 6.4) which are executed in the name of
the Company and (b) to execute powers of attorney delegating authority to other
persons to execute investment instruments for the purpose of expediting a
specific transaction or to facilitate foreign investing.
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Section 6.6 OTHER INSTRUMENTS.
The chairman of the board, if any, the president, and all vice presidents
or other executive officers, and such other persons as the board or the
executive committee may designate shall each have authority (a) to execute on
behalf of the Company all other instruments (in addition to those described in
Sections 6.2 through 6.5) executed in the name of the Company; and (b) to
execute powers of attorney delegating authority to other persons to execute on
behalf of the Company other instruments executed in the name of the Company for
specific purposes.
Section 6.7 ATTESTATION.
The secretary and assistant secretaries shall each have authority to
attest, countersign and acknowledge all instruments described herein requiring
attestation, countersignature or acknowledgment.
ARTICLE VII
INDEMNIFICATION
Section 7.1 INDEMNIFICATION OF TRUSTEES, OFFICERS AND EMPLOYEES.
(a) SUCCESSFUL DEFENSE. The Company shall indemnify a trustee, officer,
employee or member of a committee, to the extent he or she has been
successful on the merits or otherwise in the defense of a proceeding,
for all reasonable expenses incurred in the proceeding if the trustee,
officer, employee or member of a committee was a party because he or
she is a trustee, officer, employee or member of a committee of the
Company.
(b) OTHER CASES. In cases not included under (a) above, the Company shall
indemnify a trustee, officer, employee or member of a committee
against liability incurred in a proceeding to which the trustee,
officer, employee or member of a committee was a party because he or
she is a trustee, officer, employee or member of a committee of the
Company or was serving at the Company's request as a director,
officer, employee, agent, partner, trustee, member of any governing or
decision-making committee of another corporation, partnership, joint
venture, trust or other enterprise, unless liability was incurred
because the trustee, officer, employee or member of a committee
breached or failed to perform a duty owed to the Company and the
breach or failure to perform constitutes any of the following: (i) a
wilful failure to deal fairly with the Company or its members in
connection with a matter in which the trustee, officer, employee or
member of a committee has a material conflict of interest, (ii) a
violation of criminal law, unless the trustee, officer, employee or
member of a committee had reasonable cause to believe his or her
conduct was lawful or no reasonable cause to believe his or her
conduct was unlawful; (iii) a transaction from which the trustee,
officer, employee or member of a committee derived an improper
personal profit; or (iv) wilful
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misconduct. The termination of a proceeding by judgment, order,
settlement, conviction or upon a plea of no contest or its equivalent,
does not, by itself, create a presumption that indemnification is not
required pursuant to this section. A trustee, officer, employee or
member of a committee who seeks indemnification under this section
shall make a written request to the Company. Indemnification under
this section is not required if the trustee, officer, employee or
member of a committee previously received indemnification or allowance
of expenses in connection with the same proceeding.
Section 7.2 DETERMINATION OF RIGHT TO INDEMNIFICATION.
Any indemnification under Section 7.1, unless ordered by a court, shall be
made by the Company only as authorized in the specific case upon a determination
that indemnification of the trustee, officer, employee or member of a committee
is proper in the circumstances because he or she has met the applicable standard
of conduct. Such determination shall be made by one of the following means
selected by the person seeking indemnification:
(a) By majority vote of a quorum of the Board consisting of trustees not
at the time parties to the same or related proceedings. If a quorum
of disinterested trustees cannot be obtained, by majority vote of a
committee duly appointed by the Board and consisting solely of two or
more trustees not at the time parties to the same or related
proceedings. Trustees who are parties to the same or related
proceedings may participate in the designation of members of the
committee.
(b) By independent legal counsel selected by a quorum of the Board or its
committee in the manner described in (a) or, if unable to obtain such
a quorum or committee, by majority vote of the full Board, including
trustees who are parties to the same or related proceedings.
(c) By a panel of three arbitrators consisting of one arbitrator selected
by those trustees entitled under (b) to select independent legal
counsel, one arbitrator selected by the person seeking
indemnification, and one arbitrator selected by the two arbitrators
previously selected.
Section 7.3 ALLOWANCE OF EXPENSES AS INCURRED.
Upon written request by a trustee, officer, employee or member of a
committee who is party to a proceeding, the Company may pay or reimburse his or
her reasonable expenses as incurred, if such advance payment is authorized in a
manner provided in Section 7.2, and if the person provides the Company with the
following:
(a) A written affirmation of his or her good faith belief that he or she
has not breached or failed to perform his or her duties to the
Company; and
(b) A written undertaking, executed personally or on his or her behalf, to
repay the allowance to the extent that it is ultimately determined
under
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Section 7.2 that indemnification is not required and that
indemnification is not ordered by a court. The undertaking under this
section shall be an unlimited, general obligation of the person
involved, may be secured or unsecured, and may be accepted without
reference to his or her ability to repay.
Section 7.4 ADDITIONAL RIGHTS TO INDEMNIFICATION AND ALLOWANCE OF EXPENSES.
Except as limited by law, the indemnification and allowance of expenses
provided by this article do not preclude any additional right to indemnification
or allowance of expenses that a trustee, officer, employee, member of a
committee, or other person serving at the request of the Company as a director,
officer, employee or agent of another corporation, partnership, joint venture,
trust or other enterprise may have under any written agreement between such
person and the Company, resolution of the Board, or resolution adopted by the
members.
Section 7.5 INSURANCE.
The Company may purchase and maintain insurance on behalf of any person who
is or was a trustee, officer, employee or member of a committee of the Company
or is or was serving at the request of the Company as a director, officer,
employee or agent of another corporation, or a partnership, joint venture, trust
or other enterprise, against any liability asserted against him and incurred by
him in any such capacity or arising out of his status as such, whether or not
the Company would have the power to indemnify him against such liability under
this article.
Section 7.6 GENERAL.
For purposes of this article, the definitions contained in Section 181.041
of the Wisconsin Statutes are incorporated herein by this reference except that
"trustee" shall be used wherever the term "director" appears in the statute.
The term "employee" shall mean a natural person who is or was an employee of the
Company or who, while an employee of the Company, is or was serving at the
Company's request as a director, officer, partner, trustee, member of any
decision-making committee, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, and, unless the context
requires otherwise, the estate or personal representative of the employee.
"Member of a committee" shall mean a member of the examining committee described
in Article V. The provisions of this article shall apply from the date of
adoption of this By-Law, regardless of the date of the occurrence for which
indemnification is sought. Any right to indemnification under any prior By-Law
of the Company is terminated as of the date of adoption of this By-Law.
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ARTICLE VIII
EMERGENCY PROVISIONS
Section 8.1 CONTINUITY OF MANAGEMENT.
To insure continuity of management in the event of a national emergency
caused by military attack or by a nuclear, atomic or other disaster, the
following delegation of executive authority and responsibility is provided on a
temporary basis pursuant to the Wisconsin Statutes until the executive committee
or a board of trustees can act:
(a) ACTING PRESIDENT. In the event such emergency results in the
disability or absence of the chairman of the board and the president,
then an executive officer in the order specified in the latest
resolution of the board relating to powers and duties of executive
officers shall be and is hereby designated as acting president and
chief executive officer, but if no executive officer is then
available, the trustee senior in point of service on the board of
trustees, who is able and willing to act, shall be and is hereby
designated the acting president and chief executive officer.
(b) POWERS OF ACTING PRESIDENT. The acting president shall exercise the
powers and perform the duties of the president, except as otherwise
provided in the By-laws, and shall have authority to relocate the
principal office within the United States, to take charge of all
Company property and records, including copies of such records as may
be deposited outside the principal office, and to sign all instruments
relating to the business of the Company, including checks.
(c) EXECUTIVE COMMITTEE. The acting president shall immediately call a
meeting of the executive committee, and such committee shall have
authority to designate substitutes for absent or disabled executive
officers to act until the next meeting of the board, and shall have
authority to determine a suitable location within the United States
for the Company's principal office.
(d) COMMITTEE QUORUM. If by reason of such emergency a quorum of either
the executive committee or finance committee cannot be obtained, then
the acting president shall have authority to designate such number of
trustees as may be required for a quorum, to serve as substitutes on
such committee. If sufficient substitutes are not available, the
acting president may reduce the number constituting a quorum or any
committee to not less than 3.
(e) BOARD QUORUM. If by reason of such emergency a quorum of the board
cannot be obtained, 3 trustees shall constitute a quorum for the
transaction of business at all meetings of the board. Any vacancy in
the board may be filled by a majority of the remaining trustees,
though less than a quorum, or by a sole remaining trustee. If there
are no
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surviving trustees but at least 3 executive officers of the Company
survive, then the president if he survives and 2 (or 3 if the
president does not survive) other executive officers in the order
listed in the latest resolution of the board relating to powers and
duties of executive officers shall be the trustees and shall possess
all of the powers of the previous board and such powers as are granted
herein. By majority vote such emergency board of trustees may elect
other trustees. If there are not at least 3 surviving executive
officers, the Wisconsin Commissioner of Insurance or duly designated
person exercising the powers of the Commissioner of Insurance shall
appoint 3 persons as trustees who shall possess all of the powers of
the previous board and such powers as are granted herein, and these
persons by majority vote may elect other trustees.
ARTICLE IX
OFFICES
Section 9.1 OFFICES.
The location of the principal office of the Company shall be
determined by the board. The Company may have other offices at such locations
as may be necessary or convenient for the conduct of its business.
ARTICLE X
CORPORATE SEAL
Section 10.1 CORPORATE SEAL.
The board may prescribe a corporate seal for the Company, which shall
contain the name of the Company, the words "Corporate Seal" and such other
devices, if any, as the board may determine.
ARTICLE XI
AMENDMENTS
Section 11.1 AMENDMENT OR REPEAL OF THE BY-LAWS.
(a) BY MEMBERS. The members may, at any regular or special meeting of the
members at which a quorum is present, amend or repeal these By-laws or
adopt new By-laws by the affirmative vote of at least two-thirds of
the votes entitled to be cast by the members present in person or by
proxy at such meeting.
(b) BY BOARD. The board may, at any regular or special meeting of the
board, amend or repeal these By-laws or adopt new By-laws, except that
no by-law adopted by the members shall be subject to amendment or
repeal by the board. Written notice setting forth the substance of
the proposed action shall be given in the manner
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provided in Section 3.5 to every member of the board at least 6 days
prior to the meeting date.
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APPENDIX
RESTATED ARTICLES OF INCORPORATION
OF
THE NORTHWESTERN MUTUAL
LIFE INSURANCE COMPANY
a Wisconsin corporation
(Adopted July 26, 1972)
ARTICLE I
NAME
The name of the Company shall be The Northwestern Mutual Life Insurance
Company.
ARTICLE II
PERIOD OF EXISTENCE
The period of existence of the Company shall be perpetual.
ARTICLE III
PRINCIPLES AND PURPOSES
The Company is a mutual insurance company, without capital stock,
incorporated in 1857 by special act of the Wisconsin Legislature. The Company
is organized and operated for the mutual protection and benefit of those persons
who hold insurance policies or annuity contracts issued by the Company or who
have beneficial interests in such policies or contracts. Neither such persons
nor the policies or contracts are or shall be subject to assessment for any
purpose whatsoever.
The purposes of the Company are to engage in any lawful activity for which
insurance corporations may be organized under the Wisconsin Statutes, including
without limitation the conducting of an insurance business and businesses
incidental thereto, the making of investments and the ownership and operation of
subsidiaries, all as and to the extent authorized by the Wisconsin Statutes.
ARTICLE IV
PRINCIPAL OFFICE
The location of the principal office of the Company shall be determined by
the board of trustees. At the date of adoption of these Articles the principal
office is located in the City of Milwaukee, Wisconsin.
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ARTICLE V
MEMBERS
The members of the Company shall be those persons who are policyholders of
one or more insurance policies or deferred annuity contracts issued by the
Company, then in force and not matured by death of the insured or annuitant or
attainment of maturity date.
The rights of members shall be as provided under the Wisconsin Statutes,
these Articles and the By-laws of the Company. The rules governing voting by a
member, including eligibility to vote and voting procedures, shall be as
provided in the Wisconsin Statutes and the By-laws.
ARTICLE VI
BOARD OF TRUSTEES
The board of trustees of the Company shall consist of such individual
members of the Company, not less than nine, as may be provided in the By-laws.
The By-laws may prescribe other qualifications for the trustees and may divide
them into classes according to their terms of office. The method of election or
appointment of the trustees and their terms of office shall be as provided in
the By-laws. The term "trustee" may be changed to "director" by an amendment to
the By-laws.
ARTICLE VII
MEMBERS' MEETINGS
Regular and special meetings of the members of the Company shall be held as
provided in the By-laws. The Company may make reasonable expenditures in
support of candidates nominated by the board for election as trustees and the
position of its management at any meeting.
ARTICLE VIII
AMENDMENTS
These Articles may be amended in the manner authorized by law at the time
of adoption of the amendment.
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Exhibit A (12)
NORTHWESTERN MUTUAL VARIABLE LIFE ACCOUNT
Description of Issuance, Transfer and Redemption Procedures for Variable
Life Insurance Contracts Pursuant to Rule 6e-3(T)(b)(12)(iii) and Method of
Computing the Adjustment in Payments and Cash Values for Conversions Pursuant to
Rule 6e-3(T)(b)(13)(v)(B).
INTRODUCTION
1. Rule 6e-3(T)(b)(12) under the Investment Company Act provides
exemption from Sections 22(c), 22(d), 22(e) and 27(c)(1) of the Act and Rule
22c-1 thereunder for variable life insurance policies which meet the conditions
of the Rule. (Rule 6e-3(T) has not been amended to reflect the addition of
Section 27(c)(i); the registration statement with which this memorandum is filed
includes a representation in compliance with Section 27(e)(2)(A) of the
Investment Company Act, as amended in 1996.) Rule 6e-3(T)(b)(13)(v) provides
exemption from Section 27(f) of the Act for variable life insurance policies
which, among other conditions, provide for the right to convert the policies to
fixed benefit life insurance within twenty-four months after the policies are
issued. Both Rules refer to materials which must be included in the separate
account's filing with the Commission pursuant to paragraph (b)(3)(ii) of Rule
6e-3(T).
2. Rule 6c-3 provides exemptions for a registered variable life insurance
separate account which registers under Section 8 of the Act, except for
exemption from the registration requirements, "under the same terms and
conditions as a separate account claiming exemption under --- Rule 6e-3(T)."
Therefore a separate account which registers as contemplated by Rule 6c-3 may be
required to include the materials referred to in Rules 6e-3(T)(b)(12)(iii) and
6e-3(T)(b)(13)(v) as exhibits to its registration statement filed under the Act.
The purpose of this memorandum is to fulfill this requirement with respect to
the Flexible Premium Variable Joint Life Insurance Policy ("Policy") proposed to
be offered in connection with Northwestern Mutual
<PAGE>
Variable Life Account ("Account"), a separate investment account of The
Northwestern Mutual Life Insurance Company ("Northwestern").
RULE 6e-3(T)(b)(12)(iii)
3. Rule 6e-3(T)(b)(12)(iii) provides exemptions from the sections and
rules cited above to the extent "Necessary to comply with this Rule or with
insurance laws and regulations and established administrative procedures of the
life insurer for issuance increases in or additions of insurance benefits,
transfer and redemption of flexible contracts, including, but not limited to,
premium rate structure and premium processing, insurance underwriting standards,
and the particular benefit afforded by the contract. . ." The Rule thus
recognizes that the established procedures of the insurance company itself,
founded on the requirements of the state insurance law, have a principal role in
defining the requirements which apply for variable life insurance offered by the
same company.
ISSUANCE PROCEDURES
A. PREMIUM STRUCTURE AND INSURANCE UNDERWRITING STANDARDS
4. The Policy is a flexible premium contract. Premiums may be paid at
any time and in any amount, within limits. The actual cost of insurance charge
will depend on the age, sex and insurance risk classification of the proposed
insureds, as well as the net amount at risk. Thus the price of the insurance
will differ, reflecting established insurance procedures and state law, in order
to fairly take into account the differences in risks.
5. As a mutual life insurance company organized in Wisconsin,
Northwestern is required to offer its insurance contracts as participating
policies which share equitably in Northwestern's divisible surplus. The
Policies accordingly have been designated as participating. However, no
dividends are anticipated since this Policy is not expected to contribute to
divisible surplus.
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6. Notwithstanding the documented differences between male and female
mortality rates, a 1983 decision of the U.S. Supreme Court (1) has created legal
liability issues for employers who purchase, or are otherwise involved in the
purchases of, insurance products which are priced so as to reflect these
differences. Similarly, the laws of individual states (currently only Montana)
require that policies offered there use a sex-neutral pricing basis. The
Policies will accordingly be offered on a sex-neutral pricing basis for use as
required in such situations.
B. PROCEDURES FOR PLACING A POLICY IN EFFECT
7. When the applicant applies for a Policy, Northwestern will begin the
same process of risk evaluation which takes place when an application for a
fixed benefit insurance policy is received. Several days or weeks may elapse
from the date of the application until this underwriting procedure is completed
and, if insurability is established, the Policy is issued and delivered to the
owner. If both insureds die in the interim, after at least the minimum initial
premium has been paid, Northwestern pays the death benefit to the beneficiary
unless it is determined that the application would have been rejected.
8. If the applicant for insurance pays at least the minimum initial
premium when the application is submitted, the Policy Date will be the date when
Northwestern received the later of (1) the application and (2) medical evidence
form.
9. If the application is submitted without any premium, the underwriting
procedure will be carried out and the Policy will be issued and delivered in due
course. In that case the Policy Date will be 7 days after the date on which the
application is finally approved and the Policy is issued, provided that the
Policy is in fact delivered within 32 days after the approval date and the
premium is paid at that time. If more than 32 days elapse, the Policy Date will
be reset according to the agent's instructions and will be subject to approval
by the Home Office.
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(1) ARIZONA GOVERNING COMMITTEE, ETC. v. NORRIS, 103 S. Ct. 3492 (1983).
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10. For life insurance purposes, one's age is reckoned as the age at the
last or next birthday, depending on which is closer. The Policy Date may be
backdated for a maximum of 6 months, but no earlier than October 31, 1998,
subject to applicable state insurance law.
11. In any case, investment experience begins on the date the initial
premium is received. For all purposes under the Policies, the Policy Values for
any date are determined as of the close of business on that date, or whenever
the assets of the Account are next valued. Assets of the Account consist
entirely of shares of Northwestern Mutual Series Fund, Inc., ("Fund") and shares
of each series of the Fund are valued daily as of the close of trading on the
New York Stock Exchange.
12. The suicide and incontestability periods under a Policy will run from
the Issue Date. The Issue Date will not necessarily coincide with the Policy
Date, for the reasons indicated above.
C. PREMIUM PROCESSING
13. Premiums may be paid at any time and in any amount, within limits.
The net premium, after the deductions described in the prospectus, will be
placed in the Account on the date received by Northwestern at its Home Office.
14. Transactions between the Account and the general account of
Northwestern will be effected as of the dates determined in accordance with the
terms of the Policies but the transactions will not in all cases be physically
processed on those dates. For example, as described below, the death of the
second insured will mark the date on which the Policy ceases to participate in
the Account, with interest being paid on Policy proceeds from that date until
the Policy is settled, but several days may elapse before Northwestern receives
notification. Because of the timing discrepancies the total assets of the
Account will not always exactly match the sum of the interests in the Account
represented by all of the Policies outstanding. An accounting routine will be
established to reconcile these amounts once each year, as of December 31, and
the amount of assets in the Account will be adjusted as required.
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TRANSFER PROCEDURES
15. The Account consists of nine divisions, corresponding to the nine
Portfolios of the Fund. All assets of each division are invested in shares of
the corresponding Fund Portfolio. Anytime following the initial allocation
date, the Policy owner may direct that accumulated amounts under the Policy be
transferred from one division to another. The Policy provides for a $25 charge
for transfers of assets among the divisions of the Account if more than twelve
transfers take place in a policy year. Currently, this fee is being waived.
Transfers will be effected as of the date when a written request is received at
Northwestern's Home Office.
16. In order to minimize the investment risk to Northwestern during the
period when the Policy owner has the right to return the Policy for a refund,
premiums placed into the Account prior to the initial allocation date are placed
in the Money Market Division of the Account. The initial allocation date is
described in the prospectus and identified in the Policy. On the initial
allocation date amounts in the Money Market Division of the Account are
transferred to other divisions based on the instructions in the application for
the Policy.
REDEMPTION PROCEDURES
A. SURRENDER FOR CASH VALUE
17. The cash value equals the Policy Value, less any Policy debt
outstanding, less the surrender charge. The owner of a Policy may surrender it
for the cash value of the Policy at any time upon written request before the
death of the second insured. Northwestern will affix a date and time stamp when
the request is received at its Home Office and pay the cash value computed as of
that day.
18. For its conventional fixed benefit insurance, Northwestern has
developed performance goals for the timeliness of responses to requests for
payment of policy benefits, including payment of cash and loan values.
Performance is closely monitored and data are compiled on a periodic basis. The
data from August 1996 to August 1997 show that 77% of surrender requests and 93%
of loan applications were processed within five days. For these
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Policies, Northwestern will implement special handling procedures to assure that
benefits are paid within seven days after a request with the necessary
information is received.
19. When a surrender of a Policy is effected, Northwestern will pay the
cash value out of its general assets. An amount equal to the interest of the
Policy in the Account will be transferred from the Account to Northwestern's
general account as of the effective date of the surrender.
B. PARTIAL WITHDRAWAL OF CASH VALUE
20. A withdrawal of Policy Value may be made under certain conditions
specified in the prospectus. A withdrawal may not reduce the loan value to less
than any Policy debt outstanding. Following a withdrawal the remaining Policy
Value must be at least three times the current monthly charge. Also, following
a withdrawal the remaining death benefit must be at least the minimum amount
that Northwestern would currently issue, but not less than the initial Specified
Amount. The minimum amount for withdrawals is $250. The Policy reserves the
right to charge a fee of up to $25 per withdrawal. This fee is currently being
waived.
21. Withdrawals may be made upon written request at Northwestern's Home
Office. The maximum allowable withdrawal will be determined by reference to
computations as of the close of business on the day the request is received.
The check for the amount of the withdrawal will be mailed from the Home Office.
Special handling procedures will be implemented to assure that withdrawal
benefits are paid within seven days after a request is received.
C. PAYMENT OF DEATH BENEFIT
22. Northwestern will pay the death benefit to the beneficiary or other
payee in accordance with the terms of the Policy following receipt at its Home
Office of proof of the death of the insureds. Payment of the death benefit is
subject to the suicide and incontestability provisions of the Policy and any
applicable state law requirements. Payment will be made promptly and in any
case within seven days after the last of the conditions is met.
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23. The death benefit for a Policy will depend on the death benefit option
chosen. With Option A, the death benefit equals the Specified Amount. With
Option B, the death benefit equals the sum of the Specified Amount and the
Policy Value. And with Option C, the death benefit equals the sum of the
Specified Amount and premiums paid. At ages 100 and older of the younger
insured, the death benefit will equal the Policy Value under all three options.
In addition, under any of the options, the death benefit will be increased, if
necessary, to meet the definitional requirements for life insurance for federal
income tax purposes. The death benefit is adjusted to reflect any unpaid
monthly charges if the Policy is in the grace period. Also, any Policy debt is
deducted from the death benefit.
24. Northwestern will pay the death benefit for a Policy out of its
general assets. The amount payable will include interest from the date of
death. An amount equal to the interest of the Policy in the Account as of the
date of death will be transferred from the Account to Northwestern's general
account.
D. LAPSE AND REINSTATEMENT
25. If the cash value is less than the monthly charges on any monthly
processing date, a 61 day (2) grace period is allowed for the payment of
sufficient premium to keep the Policy in force. The grace period begins on the
date when a notice is sent to the policyowner. The notice will state the
minimum amount of premium required to keep the Policy in force and the date by
which the premium must be paid. The Policy will terminate with no value unless
the
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(2) In administering the Policies Northwestern intends to use a 66-day period,
instead of 61 days, before the lapse routine is implemented. The longer period
is used simply to reduce the volume of lapse and reinstatement transactions
occasioned by miscalculation when Policy owners attempt to pay the overdue
premium on the last day of the grace period. The 66-day period is used for
Northwestern's fixed benefit insurance policies and will be administered
consistently. It does not appear in the prospectus for the Policies because its
purpose would be defeated if Policy owners know that the extra time would be
allowed. When the 66 days have transpired and the Policy lapses, the values
will be computed as though the Policy had lapsed after the grace period of 61
days. Notwithstanding the postponement of internal procedures to reflect the
fact of a lapse, the Policy does lapse upon the experience of the grace period
and the death benefit is determined accordingly if the insured dies thereafter
regardless of whether the internal procedures have been implemented prior to the
date of death.
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required amount is paid before the grace period expires. If the second death
occurs during the grace period, the death proceeds will be reduced by the amount
of the unpaid monthly charges.
26. A lapsed Policy may be reinstated while at least one insured is alive
within one year after the Policy terminated. The Policy may not be reinstated
if the Policy was surrendered for its cash value or if either of the insureds
died after the end of the grace period. Reinstatement is conditional upon
evidence of insurability and payment of an amount equal to the monthly charges
that were due when the Policy terminated plus charges for three more months.
Reinstatement will be effected as of the first monthly processing date after the
request for reinstatement is received at the Home Office of Northwestern,
subject to approval by Northwestern. Any Policy debt that was outstanding when
the Policy terminated will also be reinstated. The Policy Value when a policy
is reinstated is equal to the premium paid, after the deduction for taxes and
sales load, less the sum of all monthly charges for the cost of insurance and
other expenses for the grace period and for the current month. The cash amount
required to reinstate a Policy will be paid into Northwestern's general account
and the amount required for the Policy's separate account reserve will be placed
in the Account as of the reinstatement date.
E. POLICY LOANS AND LOAN REPAYMENTS
27. The Policies provide that the owner may borrow from Northwestern using
the Policy as collateral security. The maximum loan value is 90% of the cash
value. If a Policy loan is already outstanding, these limitations are applied
to the amount of cash value which the Policy would have if there were no loan.
28. The Policy provides that loans will be made upon written request.
Northwestern also intends to honor requests made at the offices of its agents in
accordance with procedures presently in place for fixed benefit policies. In
that case the request will be transmitted to the Home Office for processing. In
any event, the check for the loan proceeds will be mailed from the Home Office,
usually the next business day after the request is received. The date of the
loan will be the date on which the check for the loan proceeds is issued. The
maximum loan value of the Policy will be determined by reference to computations
at the close of business the
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preceding day -- after the request for the loan was submitted but before
processing took place -- and interest will accrue on the loan from the date of
the check.
29. Interest on a Policy loan accrues and is payable on a daily basis.
The Policy loan rate is a fixed rate of 5%. Unpaid interest is added to the
principal. The Policy will terminate if the cash value falls to zero on a
monthly processing date, but written notice will be mailed to the owner of the
Policy at least 61 days before the termination date. The notice will state the
amount which must be paid to keep the Policy in force.
30. When a Policy loan is effected, the loan amount is taken from the
divisions of the Account in proportion to the amounts in the divisions. The
amounts taken from the Account are credited with an earnings rate equal to the
Policy loan interest rate. On the monthly processing date, a charge for
expenses and taxes associated with any Policy debt is deducted. The amount
deducted for expenses is disclosed in the prospectus. The earnings rate is in
lieu of the investment experience of the Account. The amounts of any loan
repayments will be transferred from Northwestern's general account to the
divisions of the Account, according to the allocation percentages in effect for
premiums, and will thereafter participate in the Account's investment
experience.
F. EXCHANGE OF POLICY
31. In those states that require the option to exchange the Policy for a
permanent fixed benefit policy, the Policy provides that the owner may exchange
the Policy during a limited period for a conventional whole life insurance
policy with benefits that do not vary with the investment experience of a
separate account. The fixed benefit policy will be issued by Northwestern, will
be on the lives of the same insureds, and will have the same initial death
benefit, Policy Date and issue ages as the Policy being exchanged. The premiums
and cash values for the new policy will be the same as those for fixed benefit
policies issued by Northwestern on the Issue Date of the Policy. No evidence of
insurability is required.
32. The exchange will be subject to an equitable cash adjustment, which is
calculated consistent with the requirements of Rule 6e-3(T)(b)(13)(v) although
the load
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structure of the Policy does not require exemption from Section 27(f) of the
Investment Company Act. The amount of cash adjustment will be equal to the
difference between 1) the discounted Policy Value plus the sum of all loads and
charges previously deducted on this Policy; and 2) the premium(s) payable on the
fixed benefit policy.
33. The effective date of the exchange will be the date when Northwestern
received the request together with the Policy and any amount due for the cash
adjustment. The owner of the Policy may request a later date. An amount equal
to the interest of the Policy in the Account will be transferred from the
Account to Northwestern's general account on the effective date of the exchange.
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Exhibit C(6)
July 15, 1998
The Northwestern Mutual Life Insurance Company
720 East Wisconsin
Milwaukee, WI 53202
Gentlemen:
This opinion is furnished in connection with the Registration Statement on
Form S-6 of Northwestern Mutual Variable Life Account. The prospectus included
in the Registration Statement ("Prospectus") describes the Flexible Premium
Variable Joint Life Insurance Policy to be issued in connection with the Account
("Policy"). The Policy form was prepared under my direction, and I am familiar
with the Registration Statement and Exhibits thereto. In my opinion:
1. The illustrations of death benefits, policy values, cash values and
accumulated premiums included on pages 38 through 46 of the Prospectus, in
Appendix A thereto, based on the assumptions stated in the illustrations,
are consistent with the provisions of the Policies and current charges and
experience. The Policy has not been designed so as to make the
illustrations appear more favorable for a prospective male and female
insured, both age 55, as shown, than for other combinations of insureds
based on age and gender or for insureds on a sex-neutral basis.
2. With respect to the charge of 1.25% of premiums for federal income taxes
measured by premiums, described on page 6 of the Prospectus,
(a) the charge is reasonable in relation to the issuer's increased federal
tax burden under Section 848 of the Internal Revenue Code of 1986;
(b) the targeted rate of return (11%) used in calculating the charge is
reasonable; and
(c) the factors taken into account in determining such targeted rate of
return are appropriate.
I hereby consent to the use of this opinion as an exhibit to the
Registration Statement and to the reference to my name under the heading
"Experts" in the Prospectus.
Sincerely,
WILLIAM C. KOENIG
William C. Koenig
Senior Vice President
and Chief Actuary
