<PAGE>
PROSPECTUS
- -------------------------------------------------------------------------------
SEPARATE ACCOUNT NO. 2
Variable Accumulation Annuity Contracts
Issued By
Mutual of America Life Insurance Company
320 Park Avenue
New York, New York 10022
- -------------------------------------------------------------------------------
The group and individual variable accumulation annuity contracts ("Contracts")
offered by Mutual of America Life Insurance Company (the "Insurance Company")
and described in this Prospectus are designed to aid employees of
organizations in the not-for-profit field in retirement and long-term
financial planning by providing monthly Annuity Payments which begin at a
selected future date. The following four types of contracts are offered: (1) a
group Tax-Deferred Annuity Contract ("TDA Contract"); (2) a group Voluntary
Employee Contribution Contract ("VEC Contract"); (3) an Individual Retirement
Annuity Contract ("IRA Contract"); and (4) an individual Flexible Premium
Annuity Contract ("FPA Contract").
Participating employees under TDA or VEC Contracts, and the persons to whom
IRA or FPA Contracts are issued, are referred to in this Prospectus as
"Participants."
The Contracts permit Contributions to be made, generally, in whatever amounts
and at whatever frequency is desired by a Participant. Contributions may be
accumulated on behalf of a Participant on a completely variable basis, a
completely fixed basis or a combination variable and fixed basis. The basic
purpose of the variable accumulation aspect of the Contracts is to provide
Participants with an opportunity to accumulate amounts toward retirement, or
for other financial purposes, that will reflect the investment experience of
one or more of the distinct Funds comprising Mutual of America Separate
Account No. 2 ("Separate Account") to which Contributions may be allocated.
Contributions under the Contracts may be allocated in whole or in part to any
of the Funds of the Separate Account or to the General Account of the
Insurance Company (the "Investment Alternatives").
The assets in each Fund of the Separate Account are invested in shares of:
- -- one or more of the following eight Funds of Mutual of America Investment
Corporation (the "Investment Company"): Money Market Fund, All America Fund,
Equity Index Fund, Bond Fund, Short-Term Bond Fund, Mid-Term Bond Fund,
Composite Fund and Aggressive Equity Fund;
- -- one or more of the following Fidelity Investments(R) portfolios: Equity-
Income Portfolio of the Variable Insurance Products Fund and Contrafund and
Asset Manager Portfolios of the Variable Insurance Products Fund II
(collectively, the "Fidelity Portfolios");
- -- one or more of the following three portfolios of Scudder Variable Life
Investment Fund: Scudder Capital Growth Portfolio, Scudder Bond Portfolio, and
Scudder International Portfolio (collectively, the "Scudder Portfolios");
- -- the American Century VP Capital Appreciation Fund (formerly known as the
TCI Growth Fund) of American Century Variable Portfolios, Inc.; and
- -- the Calvert Responsibly Invested Balanced Portfolio of Acacia Capital
Corporation.
The respective Prospectuses for the Investment Company, the Fidelity
Portfolios, the Scudder Portfolios, the American Century VP Capital
Appreciation Fund and the Calvert Responsibly Invested Balanced Portfolio,
which are attached to this Prospectus, describe the investment objectives and
policies of each of the variable accumulation Investment Alternatives, as well
as the risks relating to investments in each such Investment Alternative.
The value of a Participant's interest in the Separate Account will depend upon
the investment performance of the chosen Investment Alternative. THE INSURANCE
COMPANY DOES NOT GUARANTEE THE INVESTMENT PERFORMANCE OF ANY FUND OF THE
SEPARATE ACCOUNT. Accordingly, the Participant bears the entire investment
risk for any amounts allocated to the Separate Account.
Amounts accumulated under the Contracts may be applied to provide monthly
Annuity Payments on a fixed basis commencing at a future date selected by the
Participant.
This Prospectus generally describes only the variable portion of the
Contracts. For a brief summary of the fixed portion, see "The General
Account."
This Prospectus sets forth the information that a prospective investor should
know before investing. A Statement of Additional Information about the
Contracts and the Separate Account is available free by writing the Insurance
Company at the address above or by calling (212) 224-1600. The Statement of
Additional Information, which has the same date as the Prospectus, has been
filed with the Securities and Exchange Commission and is incorporated herein
by reference. The table of contents of the Statement of Additional Information
is included at the end of this Prospectus.
- -------------------------------------------------------------------------------
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.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Please read this Prospectus carefully for details on the Contracts being
offered and retain it for future reference. It is not valid unless attached to
the current prospectuses for the Investment Company, the Fidelity Portfolios,
Scudder Variable Life Investment Fund, American Century VP Capital
Appreciation Fund (formerly known as the TCI Growth Fund) and Calvert
Responsibly Invested Balanced Portfolio.
Dated: May 1, 1997
<PAGE>
2
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Table of Annual Expenses............. 4
Unit Value Information............... 6
Definitions.......................... 8
Summary.............................. 9
Mutual of America Life Insurance Com-
pany................................ 12
The Separate Account................. 13
Investments of the Separate Account.. 13
Charges.............................. 16
Administrative Charges.............. 16
Distribution Expense Charge......... 16
Mortality and Expense Risk Charge... 16
Portfolio Company Expenses.......... 17
The Group and Individual Annuity Con-
tracts.............................. 18
General............................. 18
Payment of Contributions............ 19
Allocations of Contributions........ 20
Accumulation Units.................. 20
Transfers Among Investment Alterna-
tives.............................. 21
Withdrawals......................... 21
Specified Payments Options.......... 22
Death Benefits...................... 22
Discontinuance and Termination....... 23
</TABLE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Discontinuance of TDA and VEC Contracts.............................. 23
Termination of Participation Under TDA Contracts..................... 24
Termination by the Insurance Company................................. 24
Postponement of Payments.............................................. 24
The Annuity Period.................................................... 24
General.............................................................. 24
Annuity Commencement Date............................................ 25
Available Forms of Annuity........................................... 25
Amount of Annuity Payments........................................... 26
Small Benefit Payments............................................... 26
The General Account................................................... 26
General Matters....................................................... 27
Federal Tax Matters................................................... 30
Voting Rights......................................................... 36
Performance Information............................................... 36
Funding and Other Changes............................................. 36
Other Variable Annuity Contracts...................................... 37
Table of Contents of the Statement of Additional Information.......... 37
Obtaining a Copy of the Statement of Additional Information........... 37
Order Form for Statement of Additional Information.................... 37
</TABLE>
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING IN ANY JURISDICTION IN WHICH
SUCH OFFERING MAY NOT LAWFULLY BE MADE. NO DEALER, SALESMAN OR OTHER PERSON IS
AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS IN
CONNECTION WITH THIS OFFERING OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS,
AND, IF GIVEN OR MADE, SUCH OTHER INFORMATION OR REPRESENTATIONS MUST NOT BE
RELIED UPON.
3
<PAGE>
TABLE OF ANNUAL EXPENSES
<TABLE>
<CAPTION>
Investment
Company
All America,
Bond,
Investment Short-Term Investment Investment Fidelity Fidelity
Company Bond, Company Company VIP Fidelity VIP II Scudder
Money Mid-Term Bond, Equity Aggressive Equity- VIP II Asset Capital Scudder
Market and Composite Index Equity Income Contrafund Manager Growth Bond
---------- -------------- ---------- ---------- -------- ---------- -------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Contractowner
Transaction
Expenses
Sales Load
Imposed on
Purchases...... None None None None None None None None None
Deferred Sales
Load......... None None None None None None None None None
Surrender Fees.. None None None None None None None None None
Exchange Fee.... None None None None None None None None None
Annual Contract
Fee(1).......... $24 $24 $24 $24 $24 $24 $24 $24 $24
==== ==== ==== ==== ==== ==== ==== ==== ====
Separate Account
Annual Expenses
(as a percentage
of average
account value)
Mortality and
Expense Risk
Fees(2)........ .50% .50% .50% .50% .50% .50% .50% .50% .50%
---- ---- ---- ---- ---- ---- ---- ---- ----
Account Fees and Expenses
Administrative Charges
(after reim-
bursement)(2).. .40% .40% .40% .40% .40% .40% .40% .40% .40%
Distribution
Expense
Charge(2)...... .35 .35 .35 .35 .35 .35 .35 .35 .35
---- ---- ---- ---- ---- ---- ---- ---- ----
Total Account
Fees and
Expenses....... .75 .75 .75 .75 .75 .75 .75 .75 .75
---- ---- ---- ---- ---- ---- ---- ---- ----
Total Separate
Account
Expenses....... 1.25% 1.25% 1.25% 1.25% 1.25% 1.25% 1.25% 1.25% 1.25%
==== ==== ==== ==== ==== ==== ==== ==== ====
Portfolio Company
Annual Expenses
(as a percentage
of portfolio
company average
net assets)(3)
Management Fees. .25% .50% .125% .85% .51% .61% .64% .475% .475%
Other Expenses
(after
reimbursement)(3). None None None None .07 .13 .10% .055 .135
---- ---- ---- ---- ---- ---- ---- ---- ----
Total Portfolio
Company
Expenses....... .25% .50% .125% .85% .58%(4) .74%(4) .74%(4) .53% .61%
==== ==== ==== ==== ==== ==== ==== ==== ====
<CAPTION>
American Calvert
Century VP Responsibly
Scudder Capital Invested
International Appreciation Balanced
------------- ------------ ------------
<S> <C> <C> <C>
Contractowner
Transaction
Expenses
Sales Load
Imposed on
Purchases...... None None None
Deferred Sales
Load......... None None None
Surrender Fees.. None None None
Exchange Fee.... None None None
Annual Contract
Fee(1).......... $24 $24 $24
============= ============ ============
Separate Account
Annual Expenses
(as a percentage
of average
account value)
Mortality and
Expense Risk
Fees(2)........ .50% .50% .50%
------------- ------------ ------------
Account Fees and Expenses
Administrative Charges
(after reim-
bursement)(2).. .40% .20% .40%
Distribution
Expense
Charge(2)...... .35 .35 .35
------------- ------------ ------------
Total Account
Fees and
Expenses....... .75 .55 .75
------------- ------------ ------------
Total Separate
Account
Expenses....... 1.25% 1.05% 1.25%
============= ============ ============
Portfolio Company
Annual Expenses
(as a percentage
of portfolio
company average
net assets)(3)
Management Fees. .875% 1.00% .71%
Other Expenses
(after
reimbursement)(3). .175 None .13
------------- ------------ ------------
Total Portfolio
Company
Expenses....... 1.05% 1.00% .84%(5)
============= ============ ============
</TABLE>
- -------
(1) A monthly amount of $2.00 (but not to exceed 1/12 of 1% of the Account
Value in any month) is charged with respect to each Participant under a
Contract, regardless of the number of Investment Alternatives in which the
Participant is invested. Such amount is deducted from the net assets, if
any, in one or more of the Participant's Accounts or from such net assets
which have been allocated to one or more Funds of the Separate Account in
the order as described in "Charges--Administrative Charges" herein. The
above table reflects such amount for a full year for each fund or
portfolio as if no other Investment Alternatives were used. If the General
Account is used, the fee is deducted from it and there would be no fee
with respect to amounts allocated to any fund or portfolio. If the General
Account is not used, but more than one fund or portfolio is used, then the
second or additional fund(s) or portfolio(s) would not be charged. The
employer may elect to pay this Additional Amount in which case no amount
is deducted from the Participant's Account. See "Charges--Administrative
Charges."
(2) In accordance with a Fund Participation Agreement, the investment adviser
for American Century VP Capital Appreciation Fund reimburses the Insurance
Company at an annual rate of up to .20% for Administrative Expenses. If
the Fund Participation Agreement is terminated for sales of new Contracts,
the investment adviser's reimbursement obligation will terminate, and the
administrative charge to the American Century VP Capital Appreciation Fund
will be .40% instead of .20%. The Administrative Charges, Distribution
Expense Charge and Mortality and Expense Risk Fees items are more fully
described under "Charges--Administrative Charges"; "Charges--Distribution
Expense Charge"; and "Charges--Mortality and Expense Risk Charge."
(3) The investment adviser for the Investment Company voluntarily limits the
expenses of each Investment Company Fund to its investment advisory fee.
The investment adviser for the American Century VP Capital Appreciation
Fund pays the expenses of that Fund other than the investment advisory
fee. The expenses of the Portfolio Companies are more fully described in
the prospectuses of the Portfolio Companies, which are attached to this
Prospectus.
(4) A portion of the brokerage commissions that these Portfolios pay was used
to reduce their expenses. In addition, the Portfolios have entered into
arrangements with their custodian and transfer agent whereby interest
earned on uninvested cash balances was used to reduce custodian and
transfer agent expenses. Including these reductions, total operating
expenses for the VIP Equity-Income Portfolio and the VIP II Contrafund and
Asset Manager Portfolios for 1996 would have been .56%, .71% and .73%,
respectively.
(5) The expense ratio has been restated to reflect an increase in transfer
agency expenses of 0.03% expected to be incurred in 1997. Management fees
may be adjusted based on performance by the Portfolio's advisors, which
could cause the fee to be as high as .85% or as low as .55%, depending on
performance. The Portfolio indirectly pays expenses of 0.03%, and the
Portfolio's total operating expenses for 1996 (after restatement) would
have been .81% with reductions to reflect fees paid indirectly.
4
<PAGE>
EXAMPLES
The examples below show the expenses that would be borne by a Participant,
assuming a $1,000 investment and a 5% annual rate of return on assets. No
surrender charge is imposed upon the surrender of a contract, and therefore
the expenses would be the same whether or not the contract is surrendered at
the end of the applicable time period.
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
Example for Investment Company Money Market
Fund
You would pay the following expenses on a
$1,000 investment, assuming 5% annual return
on assets:.................................. $16.97 $55.24 $ 99.88 $244.97
Example for Investment Company All America,
Bond, Short-Term Bond, Mid-Term Bond and Com-
posite Funds
You would pay the following expenses on a
$1,000 investment, assuming 5% annual return
on assets:.................................. $19.55 $63.48 $114.49 $279.14
Example for Investment Company Equity Index
Fund
You would pay the following expenses on a
$1,000 investment, assuming 5% annual return
on assets:.................................. $15.68 $51.10 $ 92.51 $227.57
Example for Investment Company Aggressive Eq-
uity Fund
You would pay the following expenses on a
$1,000 investment, assuming 5% annual return
on assets:.................................. $23.15 $74.90 $134.65 $325.56
Example for Fidelity VIP Equity-Income Fund
You would pay the following expenses on a
$1,000 investment, assuming 5% annual return
on assets:.................................. $20.38 $66.10 $119.13 $289.90
Example for Fidelity VIP II Contra Fund
You would pay the following expenses on a
$1,000 investment, assuming 5% annual return
on assets:.................................. $22.02 $71.33 $128.35 $311.15
Example for Fidelity VIP II Asset Manager Fund
You would pay the following expenses on a
$1,000 investment, assuming 5% annual return
on assets:.................................. $22.02 $71.33 $128.35 $311.15
Example for Scudder Capital Growth Fund
You would pay the following expenses on a
$1,000 investment, assuming 5% annual return
on assets:.................................. $19.86 $64.46 $116.23 $283.18
Example for Scudder Bond Fund
You would pay the following expenses on a
$1,000 investment, assuming 5% annual return
on assets:.................................. $20.69 $67.08 $120.86 $293.91
Example for Scudder International Fund
You would pay the following expenses on a
$1,000 investment, assuming 5% annual return
on assets:.................................. $25.20 $81.38 $146.00 $351.37
Example for American Century VP Capital Appre-
ciation Fund
You would pay the following expenses on a
$1,000 investment, assuming 5% annual return
on assets:.................................. $22.64 $73.28 $131.79 $319.03
Example for Calvert Responsibly Invested Bal-
anced Fund
You would pay the following expenses on a
$1,000 investment, assuming 5% annual return
on assets:.................................. $23.05 $74.58 $134.07 $324.26
</TABLE>
The purpose of the above table is to assist the Participant in understanding
the various costs and expenses that a Participant will bear, directly or
indirectly, and the table reflects the expenses of the Separate Account as
well as the Investment Company Funds, the Fidelity VIP Equity-Income
Portfolio, the Fidelity VIP II Asset Manager and Contrafund Portfolios, the
Scudder Portfolios, the American Century VP Capital Appreciation Fund
(formerly known as the TCI Growth Fund) and the Calvert Responsibly Invested
Balanced Portfolio as they were for the year ended December 31, 1996. ACTUAL
EXPENSES MAY BE GREATER OR LESS THAN THOSE ON WHICH THE EXAMPLES WERE BASED.
The annual rate of return assumed in the examples is not an estimate or
guarantee of future investment performance. Each example also assumes an
annual contract fee of $1.34 per $1,000 of value in the Separate Account based
on an average account value of $17,970. See "Charges--Administrative Charges"
for a description of how such fee would be deducted from the Investment
Alternatives.
5
<PAGE>
UNIT VALUE INFORMATION
Shown below is condensed financial information for an Accumulation Unit
outstanding throughout the ten years during the period ended December 31,
1996. The information with respect to each of the years in the five years
ended December 31, 1996, has been audited by the Funds' independent auditors,
Arthur Andersen LLP. Each of the years in the periods ended December 31, 1991
were audited by the Funds' previous auditors. THE ALL AMERICA FUND (PREVIOUSLY
CALLED THE "STOCK FUND") CHANGED ITS INVESTMENT OBJECTIVES AND POLICIES AND
ADDED SUBADVISERS ON MAY 1, 1994. Prior to May 1, 1995, the Calvert
Responsibly Invested Balanced Portfolio was known as the Calvert Socially
Responsible Series. Prior to May 1, 1997, the American Century VP Capital
Appreciation Fund was known as the TCI Growth Fund.
<TABLE>
<CAPTION>
INVESTMENT COMPANY MONEY MARKET FUND
-------------------------------------------------------------------------
1996 1995 1994 1993 1992 1991 1990 1989 1988 1987
---- ---- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Unit value, beginning of
year.................... $ 1.80 $ 1.72 $ 1.68 $ 1.65 $ 1.62 $ 1.54 $ 1.44 $ 1.33 $ 1.25 $ 1.18
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Unit value, end of
period.................. $ 1.87 $ 1.80 $ 1.72 $ 1.68 $ 1.65 $ 1.62 $ 1.54 $ 1.44 $ 1.33 $ 1.25
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Thousands of
accumulation units
outstanding, end of
period.................. 17,511 17,502 17,653 15,815 16,545 15,656 13,972 8,570 4,870 2,778
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
<CAPTION>
INVESTMENT COMPANY ALL AMERICA FUND
---------------------------------------------------------------------
1996 1995 1994 1993 1992 1991 1990 1989 1988 1987
---- ---- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Unit value, beginning of
year/period............ $ 4.52 $ 3.35 $ 3.36 $ 3.03 $ 2.97 $ 2.41 $ 2.47 $ 1.98 $ 1.82 $ 1.67
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Unit value, end of peri-
od..................... $ 5.39 $ 4.52 $ 3.35 $ 3.36 $ 3.03 $ 2.97 $ 2.41 $ 2.47 $ 1.98 $ 1.82
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Thousands of
accumulation units
outstanding, end of
period................. 49,798 43,620 38,669 36,510 32,352 26,173 20,973 20,157 20,064 23,919
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
<CAPTION>
INVESTMENT COMPANY BOND FUND
---------------------------------------------------------------------
1996 1995 1994 1993 1992 1991 1990 1989 1988 1987
---- ---- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Unit value, beginning of
year.................... $ 2.69 $ 2.28 $ 2.39 $ 2.13 $ 1.99 $ 1.73 $ 1.67 $ 1.49 $ 1.40 $ 1.42
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Unit value, end of
period.................. $ 2.75 $ 2.69 $ 2.28 $ 2.39 $ 2.13 $ 1.99 $ 1.73 $ 1.67 $ 1.49 $ 1.40
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Thousands of
accumulation units
outstanding, end of
period.................. 12,548 12,083 10,601 12,244 9,203 6,152 5,235 4,164 3,057 2,631
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
<CAPTION>
INVESTMENT COMPANY COMPOSITE FUND
---------------------------------------------------------------------
1996 1995 1994 1993 1992 1991 1990 1989 1988 1987
---- ---- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Unit value, beginning of
year.................... $ 3.39 $ 2.82 $ 2.95 $ 2.55 $ 2.43 $ 2.08 $ 2.04 $ 1.73 $ 1.60 $ 1.51
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Unit value, end of
period.................. $ 3.75 $ 3.39 $ 2.82 $ 2.95 $ 2.55 $ 2.43 $ 2.08 $ 2.04 $ 1.73 $ 1.60
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Thousands of
accumulation units
outstanding, end of
period.................. 66,715 70,558 73,239 71,215 50,944 43,115 37,461 32,716 29,436 28,126
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
</TABLE>
6
<PAGE>
<TABLE>
<CAPTION>
INVESTMENT INVESTMENT INVESTMENT INVESTMENT
COMPANY COMPANY COMPANY COMPANY
EQUITY INDEX SHORT-TERM MID-TERM AGGRESSIVE
FUND BOND FUND BOND FUND EQUITY FUND
- -------------------------- ----------------------- ----------------------- -------------------
1996 1995 1994 1993* 1996 1995 1994 1993* 1996 1995 1994 1993* 1996 1995 1994*
---- ---- ---- ----- ---- ---- ---- ----- ---- ---- ---- ----- ---- ---- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ 1.42 $ 1.05 $1.05 $1.00 $1.10 $1.03 $1.03 $1.00 $1.16 $1.01 $1.06 $1.00 $ 1.43 $ 1.05 $1.00
====== ====== ===== ===== ===== ===== ===== ===== ===== ===== ===== ===== ====== ====== =====
$ 1.72 $ 1.42 $1.05 $1.05 $1.14 $1.10 $1.03 $1.03 $1.19 $1.16 $1.01 $1.06 $ 1.80 $ 1.43 $1.05
====== ====== ===== ===== ===== ===== ===== ===== ===== ===== ===== ===== ====== ====== =====
35,660 17,109 4,644 2,135 2,129 1,447 1,132 747 3,828 2,848 1,444 1,411 49,800 20,858 9,145
====== ====== ===== ===== ===== ===== ===== ===== ===== ===== ===== ===== ====== ====== =====
<CAPTION>
INVESTMENT
COMPANY
EQUITY INDEX
FUND SCUDDER BOND FUND
- -------------------------- ---------------------------------------------------
1996 1996 1995 1994 1993 1992 1991 1990 1989
---- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$ 1.42 $11.30 $ 9.69 $10.32 $ 9.30 $8.78 $7.54 $7.05 $6.39
======= ====== ====== ====== ====== ===== ===== ===== =====
$ 1.72 $11.48 $11.30 $ 9.69 $10.32 $9.30 $8.78 $7.54 $7.05
======= ====== ====== ====== ====== ===== ===== ===== =====
35,660 1,362 1,269 1,169 1,277 1,053 600 354 221
======= ====== ====== ====== ====== ===== ===== ===== =====
</TABLE>
<TABLE>
<CAPTION>
SCUDDER CAPITAL GROWTH FUND SCUDDER INTERNATIONAL FUND
- -------------------------------------------------------- ---------------------------------------------------
1996 1995 1994 1993 1992 1991 1990 1989 1996 1995 1994 1993 1992 1991 1990 1989
---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$18.64 $14.67 $16.46 $13.80 $13.09 $ 9.48 $10.35 $ 8.53 $11.85 $10.80 $11.06 $ 8.13 $8.48 $7.68 $8.41 $6.14
====== ====== ====== ====== ====== ====== ====== ====== ====== ====== ====== ====== ===== ===== ===== =====
$22.11 $18.64 $14.67 $16.46 $13.80 $13.09 $ 9.48 $10.35 $13.43 $11.85 $10.80 $11.06 $8.13 $8.48 $7.68 $8.41
====== ====== ====== ====== ====== ====== ====== ====== ====== ====== ====== ====== ===== ===== ===== =====
9,266 8,556 8,121 6,582 3,698 2,138 1,103 844 7,688 7,269 8,610 5,400 2,262 1,849 1,644 721
====== ====== ====== ====== ====== ====== ====== ====== ====== ====== ====== ====== ===== ===== ===== =====
</TABLE>
<TABLE>
<CAPTION>
FIDELITY VIP FIDELITY FIDELITY
CALVERT RESPONSIBLY EQUITY- VIP II VIP II ASSET
AMERICAN CENTURY VP CAPITAL APPRECIATION FUND INVESTED BALANCED FUND INCOME FUND CONTRA FUND MANAGER FUND
- -------------------------------------------------- ------------------------------------ ------------- ------------- -------------
1996 1995 1994 1993 1992 1991 1990 1989 1996 1995 1994 1993 1992 1991* 1996 1995* 1996 1995* 1996 1995*
---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ----- ---- ----- ---- ----- ---- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$12.18 $ 9.39 $9.61 $8.81 $9.01 $6.40 $6.53 $5.11 $ 2.01 $1.57 $1.64 $1.54 $1.44 $1.32 $19.43 $16.30 $13.85 $11.43 $15.66 $14.04
====== ====== ===== ===== ===== ===== ===== ===== ====== ===== ===== ===== ===== ===== ====== ====== ====== ====== ====== ======
$11.53 $12.18 $9.39 $9.61 $8.81 $9.01 $6.40 $6.53 $ 2.23 $2.01 $1.57 $1.64 $1.54 $1.44 $21.93 $19.43 $16.59 $13.85 $17.72 $15.66
====== ====== ===== ===== ===== ===== ===== ===== ====== ===== ===== ===== ===== ===== ====== ====== ====== ====== ====== ======
7,264 8,061 6,361 5,946 5,280 3,056 1,518 791 10,713 7,849 5,986 5,151 2,742 678 2,342 728 3,880 1,792 613 184
====== ====== ===== ===== ===== ===== ===== ===== ====== ===== ===== ===== ===== ===== ====== ====== ====== ====== ====== ======
</TABLE>
*The dates the Funds of the Separate Account commenced operation are as
follows: Investment Company Money Market, All America (previously "Stock"),
Bond and Composite Funds--January 1, 1985; Scudder Capital Growth, Bond and
International Funds and American Century VP Capital Appreciation Fund
(previously "TCI Growth Fund")--January 3, 1989; Calvert Responsibly Invested
Balanced Fund--May 13, 1991; Investment Company Equity Index, Short-Term Bond
and Mid-Term Bonds Funds--February 5, 1993; Investment Company Aggressive
Equity Fund--May 2, 1994; and Fidelity VIP Equity-Income Fund, and Fidelity
VIP II Contra and Asset Manager Funds--May 1, 1995.
7
<PAGE>
DEFINITIONS
Accumulation Period--For each Participant, the period from the date
Contributions are first made under a Contract to the Annuity Commencement
Date.
Accumulation Unit--A measure used to calculate the value of a Participant's
interest in each of the Funds of the Separate Account prior to the Annuity
Commencement Date. Each Fund of the Separate Account has its own distinct
Accumulation Unit value.
American Century VP Capital Appreciation Fund--The American Century VP Capital
Appreciation Fund of American Century Variable Portfolios, Inc. Prior to May
1, 1997, this Fund was known as the TCI Growth Fund of TCI Portfolios, Inc.
Annuitant--A person receiving, or who will receive, Annuity Payments under a
Contract. A Participant, or another person designated under a Contract to
receive Annuity Payments, a single sum payment or the commuted value of
remaining periodic payments, may be an Annuitant.
Annuity Commencement Date--The date on which annuity benefits become payable
with respect to a Participant, and as of which the amount of the first Annuity
Payment will be determined. The Annuity Commencement Date may be the date
elected by a Participant or imposed by operation of law or, if later, the
first Valuation Day as of which all required information and documentation
have been received by the Insurance Company. Sometimes referred to by the
Insurance Company as Benefit Commencement Date.
Annuity Payments--A series of payments under a Contract for life, for a
minimum period of time, for the joint lifetime of the Annuitant and another
person and thereafter for the life of the survivor, or for such other period
under options available from the Insurance Company.
Annuity Period--The period, beginning at the Annuity Commencement Date, during
which Annuity Payments are received by an Annuitant.
Calvert Responsibly Invested Balanced Portfolio--The Calvert Responsibly
Invested Balanced Portfolio of Acacia Capital Corporation.
Code--The Internal Revenue Code of 1986, as amended.
Contract(s)--One (or more) of the group and individual variable accumulation
annuity contracts described in this Prospectus.
Contractholder--The entity to which the Insurance Company has issued a TDA or
VEC Contract. The Contractholder of a TDA Contract may be an employer, or an
association representing employers or employees. The Contractholder of a VEC
Contract may be an employer, or the trustee of the Plan adopted by the
employer.
Contributions--The amounts contributed from time to time toward the purchase
of an annuity under a Contract.
Eligible Spouse--The person to whom a Participant is legally married at the
earlier of the Participant's (a) Annuity Commencement Date or (b) date of
death.
Fidelity Portfolios--The Fidelity VIP Equity-Income Portfolio and the Fidelity
VIP II Contrafund and Asset Manager Portfolios.
Fidelity VIP Equity-Income Portfolio--The Equity-Income Portfolio of Variable
Insurance Products Fund.
Fidelity VIP II Contrafund and Asset Manager Portfolios--The Contrafund
Portfolio and Asset Manager Portfolio of the Variable Insurance Products Fund
II.
Fund--According to the context, one of the sixteen subaccounts of the Separate
Account or one of the eight investment portfolios of the Investment Company.
General Account--All of the assets of the Insurance Company that are not in a
separate account, but rather are held as part of its general assets.
Insurance Company--Mutual of America Life Insurance Company.
Investment Alternatives--The General Account and the sixteen distinct Funds
comprising the Separate Account, namely, the Funds which invest in the Money
Market, All America, Equity Index, Bond, Short-Term Bond, Mid-Term Bond,
Composite and Aggressive Equity Funds of the Investment Company, in the three
Fidelity Portfolios, in the three Scudder Portfolios, in American Century VP
Capital Appreciation Fund (formerly called the TCI Growth Fund) and in the
Calvert Responsibly Invested Balanced Portfolio. Under the Contracts, a
Participant may allocate Contributions among all of the Investment
Alternatives.
8
<PAGE>
Investment Company--Mutual of America Investment Corporation.
Participant--Under TDA and VEC Contracts, an employee or former employee
participating in a Plan and for whom Contributions have been or are being made
toward the purchase of an annuity. Under an IRA Contract, the individual, and
under an FPA Contract, the individual or employer, to whom the Contract is
issued.
Participant's Account Balance (or Account Balance)--The sum of the dollar
values of the Accumulation Units credited to a Participant in the Separate
Account and the value of amounts accumulated for the benefit of that
Participant in the General Account.
Plan--A retirement plan under which benefits are to be provided pursuant to
one of the Contracts described herein.
Plan Year--For TDA Contracts, the twelve-month period beginning each January
1; for VEC Contracts, the twelve-month period defined in a Plan.
Portfolio Companies--The Investment Company, Variable Insurance Products Fund,
Variable Insurance Products Fund II, Scudder Variable Life Investment Fund,
American Century Variable Portfolios, Inc. and Acacia Capital Corporation.
Scudder Portfolios--The following three portfolios of Scudder Variable Life
Investment Fund, namely, the Scudder Capital Growth Portfolio, the Scudder
Bond Portfolio and the Scudder International Portfolio.
Separate Account--Mutual of America Separate Account No. 2, a separate
investment account established by the Insurance Company to receive and invest
Contributions made under variable accumulation annuity contracts and other
variable contracts. The Separate Account is set aside and kept separate from
the other assets of the Insurance Company.
Valuation Day--Each day that the New York Stock Exchange is open for business.
Valuation Period--The period beginning on the close of business of each
Valuation Day and ending on the close of business on the next Valuation Day.
SUMMARY
The Following Summary Of Prospectus Information Should Be Read In Conjunction
With The Detailed Information Appearing Elsewhere In This Prospectus.
CONTRACTS OFFERED
The group and individual variable accumulation annuity contracts offered by
this Prospectus are issued by the Insurance Company and designed to aid in
retirement and long-term financial planning. The Contracts provide for the
accumulation of Contributions on a completely variable basis, a completely
fixed basis or a combination variable and fixed basis. Annuity Payments under
the Contracts will be made on a fixed basis only.
The four types of contracts described herein are summarized below:
1. Tax Deferred Annuity Contract ("TDA Contract"). A group contract designed
for use in connection with annuity purchase plans adopted pursuant to Section
403(b) of the Code by certain organizations that qualify for tax-exempt status
under Section 501(c)(3) of the Code or are eligible public schools or
colleges. TDA Contracts are issued to Contractholders, which typically are
such tax-exempt organizations or an association representing such organization
or its employees. Contributions ordinarily are made through voluntary salary
reduction arrangements. Participants under TDA Contracts may obtain certain
Federal income tax benefits provided under Section 403(b) of the Code (see
"Federal Tax Matters").
2. Voluntary Employee Contribution Contract ("VEC Contract"). A group contract
designed to provide annuity benefits to employees participating in a
retirement plan qualified for special Federal income tax treatment under
Sections 401(a) and 403(a) of the Code for Contributions prior to January 1,
1987 or transfers thereafter. VEC Contracts are issued to Contractholders,
which typically are employers or the trustees or administrators of their
retirement plans (see "Federal Tax Matters").
3. Individual Retirement Annuity Contract ("IRA Contract"). A contract
designed for use in connection with individual retirement arrangements that
qualify for favorable Federal income tax treatment under Sections 219 and 408
of the Code, which permit Contributions to be made by a Participant for the
purpose of providing retirement income. An IRA Contract may also be issued in
connection with a Simplified Employee Pension ("SEP") as defined in Section
408(k) of the Code or in connection with a Savings Incentive Match Plan for
Employees ("SIMPLE") if the employer has established such a plan. (Such IRA
Contracts may be referred to in this prospectus as "SEP IRAs" or "SIMPLE IRAs"
and other IRAs as "Regular IRAs.") Under a SEP, contributions are made by
employers to the IRA contracts of individual employees. Under
9
<PAGE>
a SIMPLE, a Participant may make contributions through a salary reduction
agreement with the Participant's employer, and an employer may contribute
amounts on behalf of a Participant. Federal tax on some or all those amounts
may be deferred (or excluded from income in connection with a SIMPLE) until
Annuity Payments commence (see "Federal Tax Matters").
4. Flexible Premium Annuity Contract ("FPA Contract"). A contract designed to
provide Annuity Payments that begin at a future date to an individual, or as a
depository for employer deferred compensation obligations. The FPA Contract
may be used in connection with retirement arrangements whether or not they
qualify for special tax treatment under the Code (see "Federal Tax Matters").
CONTRIBUTIONS
In general, Contributions under the Contracts may be made in whatever amounts
and at whatever frequency is desired by Participants. The minimum Contribution
that may be made under each of the Contracts, except TDA Contracts, is the
minimum set from time to time by the Insurance Company, currently $10.
However, there is no minimum employer contribution for an IRA issued in
connection with a SEP or for employer or Participant contributions for an IRA
issued in connection with a SIMPLE. On and after January 1, 1989, salary
reduction contributions under TDAs will be permitted if the total annual
contribution is $200 or more. The maximum annual Contributions under TDA, VEC
and IRA Contracts are those amounts permitted under the Code for Plans or
arrangements funded by those Contracts (see "The Group and Individual Annuity
Contracts--Payment of Contributions" and "Federal Tax Matters").
Under IRA and FPA Contracts, the Insurance Company may, in its sole
discretion, terminate the Contract and return amounts accumulated thereunder
to the Participant if prior to the Annuity Commencement Date no Contributions
have been made for three consecutive years and the Participant's Account
Balance is less than $500 in the case of FPA Contracts and either $2,000 or
the amount necessary to provide monthly Annuity Payments of at least $20 under
the form of annuity selected by the Participant in the case of IRA Contracts.
The Insurance Company may not, on that basis, terminate the Contract of an IRA
or FPA Participant who has not attained the age of 59 1/2.
Participants under the Contracts may allocate Contributions made on their
behalf among the Investment Alternatives provided in the Contracts, which
include the General Account and the sixteen distinct Funds of the Separate
Account.
This Prospectus is intended as a disclosure document for the variable portion
of the Contracts only. See "The General Account" for a brief summary of the
fixed portion of the Contracts.
THE SEPARATE ACCOUNT
Contributions made pursuant to the Contracts and allocated on a variable basis
are deposited in the Separate Account. The Separate Account is divided into
sixteen Funds, or sub-accounts, each one of which corresponds to one of the
eight Funds of the Investment Company, or one of the Fidelity Portfolios, or
one of the three Scudder Portfolios, or the American Century VP Capital
Appreciation Fund (formerly known as the TCI Growth Fund) or the Calvert
Responsibly Invested Balanced Portfolio, in which Separate Account assets are
invested. The objective of the variable accumulation aspect of the Contracts
is to provide a return on amounts contributed that will reflect the investment
experience of the chosen Funds. The value of the Contributions accumulated for
a Participant in the Separate Account prior to the Annuity Commencement Date
will vary with the investment experience of the chosen Funds.
THE INVESTMENT ALTERNATIVES
The Investment Alternatives to which Contributions may be allocated are the
General Account and the sixteen Funds of the Separate Account, which invest in
the eight separate investment funds of Mutual of America Investment
Corporation: the Money Market Fund, which invests in money market instruments
and other short-term debt securities; the All America Fund, which invests
approximately 60% of its assets in publicly traded common stocks in the same
manner as the Equity Index Fund (see below) and approximately 40% of its
assets in other publicly traded common stocks; the Aggressive Equity Fund,
which also invests in publicly traded common stocks; the Bond Fund, which
invests in publicly traded debt securities; the Short-Term Bond Fund which
invests in publicly traded debt securities which will produce a portfolio with
an average maturity of one to three years; the Mid-Term Bond Fund which
invests in publicly traded debt securities which will produce a portfolio with
an average maturity of three to seven years; the Composite Fund, which invests
in all of the above types of investments; and the Equity Index Fund which
invests in publicly traded common stocks comparable to the Standard &
- -------
* "Standard & Poor's 500," "S&P" and "S&P 500" are trademarks of Standard &
Poor's Corporation. The Fund is not sponsored, endorsed, sold or promoted by
Standard & Poor's Corporation. Refer to the Mutual of America Investment
Corporation Prospectus for a complete description of the disclaimers and
limitations relating to Standard & Poor's Corporation.
10
<PAGE>
Poor's Composite Index of 500 Stocks* (the "S&P 500 Index"); the Fidelity VIP
Equity-Income Portfolio, which invests primary in income-producing equity
securities; the Fidelity VIP II Contrafund Portfolio, which invests mainly in
securities of companies that are undervalued or out-of-favor; and Fidelity VIP
II Asset Manager, which allocates its assets among domestic and foreign
stocks, bonds and short-term fixed-income instruments; the following three
portfolios of Scudder Variable Life Investment Fund (collectively, the
"Scudder Portfolios"): the Scudder Capital Growth Portfolio, which invests
primarily in publicly traded equity securities; the Scudder Bond Portfolio,
which invests primarily in publicly traded debt securities; and the Scudder
International Portfolio, which invests primarily in marketable foreign equity
securities; in the American Century VP Capital Appreciation Fund (formerly
known as the TCI Growth Fund) of American Century Variable Portfolios, Inc.,
which invests primarily in publicly traded common stocks; and in the Calvert
Responsibly Invested Balanced Portfolio of Acacia Capital Corporation, which
invests in stocks, bonds and money market instruments selected with a concern
for the social impact of each investment. (See "Investments of the Separate
Account.")
REINVESTMENT
Distributions of the Portfolio Companies to the Separate Account are
automatically reinvested in additional Portfolio Company shares at net asset
value.
CHARGES
Certain charges will be deducted in connection with the operation of the
Contracts and the Separate Account.
Administrative Charges. The Insurance Company will make a deduction each
Valuation Day from the net assets of each Fund of the Separate Account for
administrative expenses at an annual rate of .40%, except that in the case of
the Fund of the Separate Account which invests in the American Century VP
Capital Appreciation Fund (formerly known as the TCI Growth Fund), the annual
rate shall be .20% (the Fund's investment adviser reimburses the Insurance
Company at an annual rate of up to .20% for administrative expenses). An
additional deduction for administrative expenses of $2.00 per month will also
be made with respect to each Participant under a Contract except that such
charge shall not exceed 1/12 of 1% of the Account Value in any month. Such
amount will be deducted from the net assets, if any, in the Participant's
Account which have been allocated to the General Account. If no net assets
have been allocated to such Account, such amount will be deducted from the net
assets which have been allocated to one or more Funds of the Separate Account,
in the following order: (a) Investment Company Money Market Fund, (b)
Investment Company Short-Term Bond Fund, (c) Investment Company Mid-Term Bond
Fund, (d) Investment Company Bond Fund, (e) Scudder Bond Fund, (f) Investment
Company Composite Fund, (g) Fidelity VIP II Asset Manager Fund, (h) Calvert
Responsibly Invested Balanced Fund, (i) Fidelity VIP Equity-Income Fund, (j)
Investment Company All America Fund, (k) Investment Company Equity Index Fund,
(l) Fidelity VIP II Contrafund Fund, (m) Investment Company Aggressive Equity
Fund, (n) Scudder Capital Growth Fund, (o) Scudder International Fund, and (p)
American Century VP Capital Appreciation Fund. The Employer may elect to pay
the additional deduction in which case there would be no deduction from a
Participant's Account. These daily and monthly charges may increase or
decrease during the life of the Contract, but may not exceed costs (see
"Charges--Administrative Charges").
Distribution Expense Charge. The Insurance Company will make a deduction each
Valuation Day from the net assets of each Fund of the Separate Account for
expenses associated with the distribution of the Contracts at an annual rate
of .35% (see "Charges--Distribution Expense Charge").
Mortality and Expense Risk Charge. For assuming certain mortality risks under
the Contracts, the Insurance Company will make a deduction each Valuation Day
at an annual rate of .35% of the net assets of each Fund of the Separate
Account. The Mortality Risk Charge is guaranteed not to increase during the
life of the Contract. For assuming certain Expense Risks under the Contracts
with respect to expenses it expects to incur over the life of the Contracts,
the Insurance Company will make a deduction each Valuation Day at an annual
rate of .15% of the net assets of each Fund of the Separate Account (see
"Charges--Mortality and Expense Risk Charge").
Portfolio Company Expenses. The value of the assets in the Separate Account
will reflect the value of the Portfolio Companies in which such assets are
invested, and therefore the fees and expenses paid by the Investment Company,
the Fidelity Portfolios, the Scudder Portfolios, American Century VP Capital
Appreciation Fund (formerly known as the TCI Growth Fund) or Calvert
Responsibly Invested Balanced Portfolio, as the case may be. A complete
description of the expenses and deductions from the Investment Company Funds,
the Fidelity Portfolios, the Scudder Portfolios, the American Century VP
Capital Appreciation Fund and Calvert Responsibly Invested Balanced Fund is
found in their respective prospectuses attached to this Prospectus.
11
<PAGE>
TRANSFERS AND WITHDRAWALS
Generally, at any time prior to the Annuity Commencement Date, a Participant
under the Contracts may transfer any or all of the Participant's Account
Balance from the Separate Account to the General Account, or from the General
Account to the Separate Account, or among the Funds of the Separate Account.
(See "Transfers Among Investment Alternatives" and "The General Account.") In
addition, a Participant may (unless, under a TDA or VEC Contract, a Plan
provides otherwise) withdraw all or a portion of the Participant's Account
Balance at any time prior to the Annuity Commencement Date. (See "Withdrawals"
and "The General Account.") Transfers or withdrawals from the General Account
may be restricted in the event a Participant has obtained a loan under the TDA
or VEC plan or arrangement and such loan is secured by all or a portion of the
Participant's interest in the General Account (see "Loans"). No withdrawals
are permitted after the Annuity Commencement Date. The Insurance Company may
take up to seven days following receipt of a Participant's withdrawal request
to process the request and mail a check to the Participant.
No charge is currently assessed for transfers or withdrawals made under the
Contracts. The Insurance Company reserves the right, however, to impose a
charge for transfers or withdrawals in the future. Certain withdrawals may be
subject to a tax penalty, and withdrawals of certain salary reduction
contributions and the earnings thereon from a TDA are subject to certain
restrictions (see "Withdrawals" and "Federal Tax Matters").
CANCELLATION RIGHT
An IRA or FPA Contract or a TDA Certificate may be surrendered for
cancellation within ten days after receipt. The Insurance Company will refund
all Contributions allocated to the General Account without deductions plus the
value on the date of surrender of all Contributions allocated to the Separate
Account. Several states, however, require that all Contributions be refunded
without deductions. You should consult the Contract for applicable provisions.
CONTACTING THE INSURANCE COMPANY
All written requests and notices required by the Contracts, and any questions
or inquiries, should be addressed to:
Mutual of America Life Insurance Company
Thomas A. Harwood
Senior Vice President
320 Park Avenue
New York, New York 10022
or to your appropriate Regional Office. You can check the address for your
Regional Office by calling 1-800-468-3785.
MUTUAL OF AMERICA LIFE INSURANCE COMPANY
The Insurance Company is a mutual life insurance company organized under the
laws of the State of New York. The Insurance Company is the successor to
National Health & Welfare Retirement Association, Inc., which was incorporated
in 1945 as a nonprofit retirement system pursuant to the then Section 200 of
the New York Insurance Law for the sole purpose of providing retirement and
other benefits for employees of nonprofit organizations in the health and
welfare field. From December 31, 1978 to January 3, 1984, the Insurance
Company was known as National Health & Welfare Mutual Life Insurance
Association, Inc. The Insurance Company currently is authorized to transact
business in 50 states and the District of Columbia. The address of the
Insurance Company's home office is 320 Park Avenue, New York, New York 10022.
The Insurance Company engages in the sale of pension, retirement and related
benefits on both a group and an individual basis for employees of not-for-
profit, social welfare, charitable, religious, educational and government
organizations. The Insurance Company invests the assets it derives from its
business in the manner permitted under applicable state law. As of December
31, 1996, the Insurance Company on a consolidated basis had total assets of
approximately $8.7 billion. The Insurance Company is registered as a broker-
dealer under the Securities Exchange Act of 1934, and also is registered as an
investment adviser under the Investment Advisers Act of 1940.
The Insurance Company's operations as a life insurance company are reviewed
periodically by various independent rating agencies such as A.M. Best &
Company, Standard and Poor's Insurance Rating Service, Moody's Investor
Services and Duff & Phelps Credit Rating Company. Such agencies publish their
ratings. From time to time the Insurance Company reprints and distributes
these rating reports in whole or in part or summaries of them to be given to
the public. The ratings concern the Insurance Company's operation as a life
insurance company and do not imply any guarantees of performance of the
Separate Account.
12
<PAGE>
THE SEPARATE ACCOUNT
The Separate Account was established pursuant to a resolution adopted by the
Board of Directors of the Insurance Company on September 22, 1983. The
Separate Account is registered with the Securities and Exchange Commission
("Commission") as a unit investment trust under the Investment Company Act of
1940 ("1940 Act"). Registration with the Commission does not involve
supervision of management or investment practices or policies of the Separate
Account or the Insurance Company by the Commission.
The Separate Account is divided into sixteen distinct Funds corresponding to
the funds, portfolios or series of the Portfolio Companies in which the assets
in such Funds are invested. The assets of the Separate Account are the
property of the Insurance Company. The Separate Account assets attributable to
the Contracts and to other annuity contracts funded by the Separate Account
are not chargeable with liabilities arising out of any other business the
Insurance Company may conduct. The income, capital gains and capital losses of
each Fund of the Separate Account are credited to or charged against the net
assets held in that Fund, without regard to the income, capital gains and
capital losses arising out of the business conducted by any of the other Funds
of the Separate Account or out of any other business that the Insurance
Company may conduct.
The Insurance Company does not guarantee the investment performance of the
Separate Account as a whole, or any of the Funds. The amount credited to a
Participant in the Separate Account, and thus the amount available to provide
annuity benefits, will depend upon the value of the assets held in the Fund(s)
of the Separate Account selected by the Participant. Accordingly, the
Participant bears the full investment risk for all amounts allocated to the
Separate Account.
The Separate Account and the Insurance Company are subject to supervision and
regulation by the Superintendent of Insurance of the State of New York, and by
the insurance regulatory authorities of each State in which it is licensed to
do business.
INVESTMENTS OF THE SEPARATE ACCOUNT
Contributions will be allocated among one or more Funds of the Separate
Account for investment at net asset value in shares of the Funds of the
Investment Company, the Fidelity Portfolios, the Scudder Portfolios, the
American Century VP Capital Appreciation Fund (formerly known as the TCI
Growth Fund), or the Calvert Responsibly Invested Balanced Portfolio, selected
by the Participant. A summary of investment objectives of the Portfolio
Companies invested in by the Funds of the Separate Account follows. More
detailed information, including risks, charges and expenses, may be found in
the current prospectuses for Mutual of America Investment Corporation, the
Fidelity Portfolios, Scudder Variable Life Investment Fund, American Century
VP Capital Appreciation Fund and the Calvert Responsibly Invested Balanced
Portfolio, which are attached to this Prospectus. Each applicable prospectus
should be read for a complete evaluation of the Investment Alternatives.
Shares of the Portfolio Companies are sold to the separate accounts of
insurance companies and are not offered for sale to the general public.
Investments in the Money Market Fund and in the other Portfolio Companies are
neither insured nor guaranteed by the U.S. Government.
MONEY MARKET FUND OF THE INVESTMENT COMPANY
The investment objective of the Money Market Fund is the realization of high
current income to the extent consistent with the maintenance of liquidity,
investment quality and stability of capital. The Money Market Fund invests
only in money market instruments and other short-term debt securities.
ALL AMERICA FUND OF THE INVESTMENT COMPANY
The investment objective of the All America Fund is to outperform the S&P 500
Index. The objective for approximately 60% of the assets of the All America
Fund (the "Indexed Assets") is to provide investment results that to the
extent practical correspond to the price and yield performance of publicly
traded common stocks in the aggregate, as represented by the S&P 500 Index.
The Indexed Assets will be invested in the same manner as the Equity Index
Fund.
The investment objective for the remaining approximately 40% of the assets
(the "Active Assets") is to achieve a high level of total return, through both
appreciation of capital and, to a lesser extent, current income, by means of a
diversified portfolio of securities that may include common stocks, securities
convertible into common stocks, bonds and money market instruments. The Active
Assets are invested by three subadvisers and Mutual of America Capital
Management Corporation (the "Adviser"). The Adviser allocates the Active
Assets to maintain, to the extent practicable under current market conditions,
approximately equal amounts among the subadvisers and the Adviser. See
"Charges--Portfolio Company Expenses".
13
<PAGE>
EQUITY INDEX FUND OF THE INVESTMENT COMPANY
The investment objective of the Equity Index Fund is to provide investment
results to the extent practical that correspond to the price and yield
performance of publicly traded common stocks in the aggregate, as represented
by the S&P 500 Index.
BOND FUND OF THE INVESTMENT COMPANY
The primary investment objective of the Bond Fund is to provide as high a
level of current income over time as is believed to be consistent with prudent
investment risk. A secondary objective is preservation of capital. The assets
of the Bond Fund will consist primarily of publicly-traded debt securities,
such as bonds, notes, debentures and equipment trust certificates. The Bond
Fund generally will invest primarily in securities rated in the four highest
categories by a nationally recognized rating service or in instruments of
comparable quality. The Bond Fund may also invest to a limited extent in
lower-rated or unrated securities, and these may be subject to greater market
and financial risk than higher quality (lower yield) issues.
SHORT-TERM BOND FUND OF THE INVESTMENT COMPANY
The primary investment objective of the Short-Term Bond Fund is to provide as
high a level of current income over time as is believed to be consistent with
prudent investment risk. A secondary objective is preservation of capital. The
assets of the Short-Term Bond Fund will consist primarily of publicly-traded
debt securities, such as bonds, notes, debentures and equipment trust
certificates which will produce a portfolio with an average maturity of one to
three years. The Short-Term Bond Fund generally will invest primarily in
securities rated in the four highest categories by a nationally recognized
rating service or in instruments of comparable quality. The Short-Term Bond
Fund may also invest to a limited extent in lower-rated or unrated securities,
and these may be subject to greater market and financial risk than higher
quality (lower yield) issues.
MID-TERM BOND FUND OF THE INVESTMENT COMPANY
The primary investment objective of the Mid-Term Bond Fund is to provide as
high a level of current income over time as is believed to be consistent with
prudent investment risk. A secondary objective is preservation of capital. The
assets of the Mid-Term Bond Fund will consist primarily of publicly-traded
debt securities, such as bonds, notes, debentures and equipment trust
certificates which will produce a portfolio with an average maturity of three
to seven years. The Mid-Term Bond Fund generally will invest primarily in
securities rated in the four highest categories by a nationally recognized
rating service or in instruments of comparable quality. The Mid-Term Bond Fund
may also invest to a limited extent in lower-rated or unrated securities, and
these may be subject to greater market and financial risk than higher quality
(lower yield) issues.
COMPOSITE FUND OF THE INVESTMENT COMPANY
The investment objective of the Composite Fund is to achieve as high a total
rate of return, through both appreciation of capital and current income, as is
consistent with prudent investment risk by means of a diversified portfolio of
publicly-traded common stocks, publicly-traded debt securities and money
market instruments. The Fund will seek to achieve long-term growth of its
capital and increasing income by investments in common stock and other equity-
type securities, and a high level of current income through investments in
publicly-traded debt securities and money market instruments.
AGGRESSIVE EQUITY FUND OF THE INVESTMENT COMPANY
The Aggressive Equity Fund will be divided by the Adviser into two segments so
as to utilize two investment styles.
The investment objective for approximately 50% of the assets of the Fund (the
"Aggressive Growth Portfolio") is to achieve capital appreciation by investing
in companies believed to possess above-average growth potential. Growth can be
in the areas of earnings or gross sales which can be measured in either
dollars or in unit volume. Growth potential is often sought in smaller, less
well-known companies in new and emerging areas of the economy, but may also be
found in large companies in mature or declining industries that have been
revitalized and hold a strong industry or market position. See "Charges--
Portfolio Company Expenses".
The investment objective for the other approximately 50% of the assets of the
Fund (the "Aggressive Value Portfolio") is to achieve capital appreciation by
investing in companies believed to possess valuable assets or whose securities
are undervalued in the marketplace in relation to factors such as the
company's assets, earnings, or growth potential.
FIDELITY VIP EQUITY-INCOME PORTFOLIO
Equity-Income Portfolio seeks reasonable income by investing primarily in
income-producing equity securities. In choosing these securities, the
Portfolio will also consider the potential for capital appreciation. The
Portfolio's goal is to achieve a yield which exceeds the composite yield on
the securities comprising the S&P 500 Index.
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FIDELITY VIP II CONTRAFUND PORTFOLIO
Contrafund Portfolio is a growth fund. It seeks to increase the value of an
investment in the Portfolio over the long-term by investing mainly in
securities of companies that are undervalued or out-of-favor. These securities
may be issued by domestic or foreign companies and many may not be well known.
The Portfolio usually invests primarily in common stock and securities
convertible into common stock, but it has the flexibility to invest in any
type of security that may produce capital appreciation.
FIDELITY VIP II ASSET MANAGER PORTFOLIO
Asset Manager Portfolio seeks high total return with reduced risk over the
long-term by allocating its assets among domestic and foreign stocks, bonds
and short-term fixed-income instruments. The Portfolio's adviser will normally
allocate the Portfolio's assets among the three asset classes within the
following investment parameters: 0-50% in short-term/money market instruments;
20-60% in bonds; and 30-70% in stocks. The expected "neutral mix", which the
Portfolio's adviser would expect over the long-term, is 10% in short-
term/money market instruments, 40% in bonds and 50% in stocks.
SCUDDER CAPITAL GROWTH PORTFOLIO
The Scudder Capital Growth Portfolio seeks to maximize long-term capital
growth through a broad and flexible investment program. The Portfolio invests
in marketable securities, principally common stocks and, consistent with its
objective of long-term capital growth, preferred stocks. However, in order to
reduce risk, as market or economic conditions periodically warrant, the
Portfolio may also invest up to 25% of its assets in short-term debt
instruments.
SCUDDER BOND PORTFOLIO
The Scudder Bond Portfolio pursues a policy of investing for a high level of
income consistent with a high quality portfolio of debt securities. Under
normal circumstances, the Portfolio invests at least 65% of its assets in
bonds, including those of the U.S. Government and its agencies, and those of
corporations and other notes and bonds paying high current income. Under
normal market conditions, the Portfolio will invest at least 65% of its assets
in securities rated within the three highest quality rating categories of
Moody's Investors Service, Inc. ("Moody's") or Standard & Poor's Corporation
("S&P"), or if unrated, in bonds judged by the Portfolio's adviser to be of
comparable quality at the time of purchase. The Portfolio may invest up to 20%
of its assets in debt securities rated lower than Baa or BBB or, if unrated,
of equivalent quality as determined by the Portfolio's adviser, but will not
purchase bonds rated below B3 by Moody's or B- by S&P or their equivalent.
SCUDDER INTERNATIONAL PORTFOLIO
The Scudder International Portfolio seeks long-term growth of capital
primarily through diversified holdings of marketable foreign equity
investments. The Portfolio invests primarily in equity securities of
established companies which do business primarily outside the United States
and which are listed on foreign exchanges. Investing in foreign securities may
involve a greater degree of risk than investing in domestic securities.
AMERICAN CENTURY VP CAPITAL APPRECIATION FUND
The American Century VP Capital Appreciation Fund seeks capital growth by
investing primarily in common stocks (including securities convertible into
common stock). It may purchase securities only of companies that have a record
of at least three years' continuous operation and such securities must enjoy a
fair degree of marketability. All securities must be listed on major stock
exchanges or traded over-the-counter. Prior to May 1, 1997, this Fund was
known as the TCI Growth Fund.
CALVERT RESPONSIBLY INVESTED BALANCED PORTFOLIO
Calvert Responsibly Invested Balanced Portfolio seeks to achieve a total
return above the rate of inflation through an actively managed non-diversified
portfolio of common and preferred stocks, bonds and money market instruments
selected with a concern for the social impact of each investment.
SHARED FUND ARRANGEMENTS
Shares of the Fidelity Portfolios, the Scudder Portfolios, the American
Century VP Capital Appreciation Fund and the Calvert Responsibly Invested
Balanced Portfolio (together, the "Shared Funds") currently are available to
the separate accounts of a number of insurance companies. The Board of
Directors of each Shared Fund is responsible for monitoring that Fund for the
existence of any material irreconcilable conflict between the interests of the
policyowners of all separate accounts investing in the Fund and determining
what action, if any, should be taken in response. If the Insurance Company
believes that a Shared Fund's response to any of those events insufficiently
protects Contractholders, it will take appropriate action. If any material
irreconcilable conflict arises, the Investment Alternatives may be modified or
reduced. See "Charter--
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FMR and its Affiliates" in the Fidelity Portfolios prospectus, "Investment
Concept of the Fund" in the Scudder Variable Life Investment Fund prospectus,
"Shareholders of American Century Variable Portfolios, Inc." in the American
Century VP Capital Appreciation Fund prospectus and "Purchase and Redemption
of Shares" in the Calvert Responsibly Invested Balanced Portfolio prospectus
for a further discussion of the risks associated with the offering of Shared
Fund shares to the Separate Account and the separate accounts of other
insurance companies.
CHARGES
The value of Accumulation Units reflects a deduction on each Valuation Day for
administrative and distribution expenses, and the mortality and expense risk
assumed by the Insurance Company. The following charges will be deducted on a
daily basis (based on annual rates) in determining the Accumulation Unit value
for each of the Funds of the Separate Account.
ADMINISTRATIVE CHARGES
The Insurance Company performs all administrative functions in connection with
the Contracts, including receiving and allocating Contributions in accordance
with the Contracts, making Annuity Payments as they become due, and preparing
and filing all reports required to be filed by the Separate Account. Expenses
incurred by the Insurance Company in connection with its administrative
functions include, but are not limited to, items such as state or other taxes,
salaries, rent, postage, telephone, travel, office equipment, costs of outside
legal, actuarial, accounting and other outside professional services, and
costs associated with determining the net asset value of the Separate Account.
The Insurance Company will make a deduction each Valuation Day from the value
of the net assets in each Fund of the Separate Account for administrative
expenses (the provisions of the Contracts include the amount of this charge
with the Distribution Expense Charge, described below) at an annual rate of
.40%, except that in the case of the Fund of the Separate Account which
invests in the American Century VP Capital Appreciation Fund (formerly known
as the TCI Growth Fund), the annual rate shall be .20% (the Fund's investment
adviser reimburses the Insurance Company at an additional annual rate of up to
.20% for administrative expenses). An additional deduction for administrative
expenses of $2.00 will be made on the next to last Valuation Day of the month,
or on another Valuation Day on or about that time that is administratively
convenient, from each Participant's Account except that such charge shall not
exceed 1/12 of 1% of the Account Value in any month. Such amount will be
deducted from the net assets, if any, in the Participant's Account which have
been allocated to the General Account. If no net assets have been allocated to
such Account, such amount will be deducted from the net assets which have been
allocated to one or more Funds of the Separate Account in the following order:
(a) Investment Company Money Market Fund, (b) Investment Company Short-Term
Bond Fund, (c) Investment Company Mid-Term Bond Fund, (d) Investment Company
Bond Fund, (e) Scudder Bond Fund, (f) Investment Company Composite Fund, (g)
Fidelity VIP II Asset Manager Fund, (h) Calvert Responsibly Invested Balanced
Fund, (i) Fidelity VIP Equity-Income Fund, (j) Investment Company All America
Fund, (k) Investment Company Equity Index Fund, (l) Fidelity VIP II Contrafund
Fund, (m) Investment Company Aggressive Equity Fund, (n) Scudder Capital
Growth Fund, (o) Scudder International Fund, and (p) American Century VP
Capital Appreciation Fund. The Employer may elect to pay the additional amount
in which case there would be no deduction from a Participant's Account. THE
INSURANCE COMPANY MAY INCREASE OR DECREASE THESE DAILY AND MONTHLY CHARGES
DURING THE LIFE OF THE CONTRACT, BUT THESE CHARGES MAY NOT EXCEED COSTS.
DISTRIBUTION EXPENSE CHARGE
As principal underwriter, the Insurance Company performs all distribution and
sales functions and bears all distribution and sales expenses relative to the
Contracts. These expenses include the payment of that portion of the salaries
of registered representatives of the Insurance Company attributable to the
sale and distribution of Contracts, as well as expenses for preparation of
sales literature and other promotional activities.
The Insurance Company will make a deduction each Valuation Day from the value
of the net assets in each Fund of the Separate Account at an annual rate of
.35% to cover anticipated distribution expenses, not to exceed, with respect
to any Participant, 9% of the total Contributions.
MORTALITY AND EXPENSE RISK CHARGE
The Insurance Company assumes certain mortality and expense risks under the
Contracts. The mortality risks arise from the Insurance Company's guarantees
in the Contracts to make Annuity Payments in certain instances in accordance
with annuity tables provided in the Contracts, regardless of how long a
Participant lives and regardless of any improvement in life expectancy
generally. Thus, the Insurance Company assumes the risk that Participants, as
a class, may live longer than has been actuarially estimated, so that payments
will continue for longer than had been anticipated. This assumption of risk by
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the Insurance Company relieves Participants of the risk that they will outlive
the funds that have been accumulated for their retirement.
For assuming the mortality risks associated with the Contracts, the Insurance
Company will, each Valuation Day, make a deduction at an annual rate of .35%
of the value of the net assets in each Fund. This charge will apply with
respect to a Participant during the Accumulation Period. The Insurance Company
guarantees that the mortality risk charge will not increase during the life of
a Contract.
The Insurance Company assumes certain expense risks under the Contracts. The
expense risks arise from the Insurance Company's guarantees in the Contracts
to make Annuity Payments in certain instances in accordance with annuity
tables provided in the Contracts, regardless of whether its estimates of
expenses it expects to incur, over the lengthy period that Annuity payments
may be made will turn out to be correct. Thus, the Insurance Company assumes
the risk that expenses will be higher than estimated.
For assuming the expense risks associated with the Contracts, the Insurance
Company will, each Valuation Day, make a deduction at an annual rate of .15%
of the value of the net assets in each Fund. This charge will apply with
respect to a Participant during the Accumulation Period.
PORTFOLIO COMPANY EXPENSES
The value of the assets in the Separate Account will reflect the value of the
shares of the Portfolio Companies in which such assets are invested, and
therefore will take into account the fees and expenses paid by the Investment
Company, Fidelity Portfolios, Scudder Portfolios, American Century VP Capital
Appreciation Fund (formerly known as the TCI Growth Fund) or Calvert
Responsibly Invested Balanced Portfolio, as the case may be.
Each Fund of the Investment Company receives investment advice from Mutual of
America Capital Management Corporation (the "Adviser"), an indirect wholly-
owned subsidiary of the Insurance Company. The Adviser receives from each such
Fund a fee calculated as a daily charge at the annual rate of .25% of the
value of the net assets in the Money Market Fund; .125% of the value of the
net assets in the Equity Index Fund; .50% of the value of the net assets in
the All America, Bond, Short-Term Bond, Mid-Term Bond and Composite Funds; and
.85% of the value of the net assets in the Aggressive Equity Fund of the
Investment Company. For 1996, the Adviser paid all of the expenses of the
Investment Company Funds other than advisory fees, brokers' commissions,
transfer taxes and other fees relating to portfolio transactions. The Adviser
limits the Investment Company Funds' expenses in this manner. See "The Funds'
Expenses" in the Investment Company prospectus.
The Adviser, with respect to three-quarters of the Active Assets of the All
America Fund, has entered into subadvisory agreements (each a "Subadvisory
Agreement") with three professional advisers: Palley-Needelman Asset
Management, Inc. ("Palley-Needelman"); Oak Associates, Ltd. ("Oak Associates")
and Fred Alger Management, Inc. ("Alger Management"). The Adviser at its own
expense will pay to the Subadvisers an amount calculated as a daily charge at
the following annual rates: Palley-Needelman, .30%; Oak Associates, .30%; and
Alger Management, .45%; of the value of the net assets for which each
Subadviser is providing investment advisory services.
Fidelity VIP Equity-Income Portfolio, Fidelity VIP II Contrafund Portfolio and
Fidelity VIP II Asset Manager Portfolio receive investment advice from
Fidelity Management & Research Company ("FMR"). FMR receives from each
Portfolio a fee, calculated as a daily charge and payable monthly, that is a
sum of two components multiplied by average net assets. The components are a
group fee rate based on the monthly average net assets of all the mutual funds
advised by FMR, which cannot exceed .52% and declines as assets rise, and an
individual fund fee rate. The effective group fee rate as of December 31, 1996
was .3021%, and the individual fund fee rates for the Equity-Income,
Contrafund and Asset Manager of Portfolios are .20%, .30% and .25%,
respectively.
Each Scudder Portfolio receives investment advice from Scudder, Stevens &
Clark, Inc., and Scudder, Stevens & Clark, Inc. receives from each such
Scudder Portfolio a fee calculated as a daily charge at the annual rate of
.475% of the value of the assets in the Scudder Capital Growth Portfolio and
the Scudder Bond Portfolio and .875% of the value of the assets in the Scudder
International Portfolio. Also, there may be deducted from each Scudder
Portfolio up to an additional .275% of the value of the assets in the Scudder
Capital Growth Portfolio and the Scudder Bond Portfolio, and up to .625% of
the value of the assets in the Scudder International Portfolio, for expenses
incurred by such Portfolio. Pursuant to a Participation Agreement between
Scudder and the Insurance Company, the Insurance Company will make a capital
contribution to the Scudder Portfolios in the amount of its pro rata portion,
allocated among insurance companies that purchase shares of the portfolios, of
the expenses of the Capital Growth and Bond Portfolios which exceed .75% of
their average net assets, and, for the International Portfolio, which exceed
1.5% of its average net assets.
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The American Century VP Capital Appreciation Fund (formerly called the TCI
Growth Fund) receives investment advice from American Century Investment
Management, Inc. (previously known as Investors Research Corporation), and
American Century Investment Management, Inc. receives from the American
Century VP Capital Appreciation Fund a fee calculated as a daily charge at the
annual rate of 1.00% of the assets of the American Century VP Capital
Appreciation Fund. Many investment companies pay smaller management fees than
the aforesaid fee paid by the American Century VP Capital Appreciation Fund to
American Century Investment Management, Inc. However, American Century
Variable Portfolios, Inc. (formerly known as TCI Portfolios, Inc.) has stated
in the prospectus for the American Century VP Capital Appreciation Fund, which
is attached to this Prospectus, that most, if not all, of such companies also
pay, in addition, certain of their own expenses, while all American Century VP
Capital Appreciation Fund's expenses except brokerage, taxes, interest, fees
and expenses of non-interested directors (including counsel fees) and
extraordinary expenses are paid by American Century Investment Management,
Inc.
Pursuant to the Fund Participation Agreement among the Insurance Company,
American Century Variable Portfolios, Inc. and American Century Investment
Management, Inc., American Century Investment Management, Inc. pays the
Insurance Company for certain administrative savings resulting from that
agreement. Currently, that payment is an amount equal to .20% per annum of the
average amount of the Separate Account's investment in American Century VP
Capital Appreciation Fund, provided the aggregate amount of the Separate
Account's investment and the investments of other separate accounts of the
Insurance Company in the American Century VP Capital Appreciation Fund for
that month exceeds $10 million. The administrative fees assessed against the
Separate Account Fund holding shares of American Century VP Capital
Appreciation Fund are reduced by the full amount of such payments to the
Insurance Company.
Calvert Responsibly Invested Balanced Portfolio receives investment advice
from Calvert Asset Management Company, Inc., and NCM Capital Management Group,
Inc. is the Sub-Advisor for the equity portion of the Portfolio. Calvert Asset
Management Company, Inc. receives from Calvert Responsibly Invested Balanced
Portfolio a monthly base fee, computed on a daily basis at an annual rate of
0.70% (subject to adjustment as described below) of average net assets of the
Portfolio. Calvert Asset Management Company, Inc. pays, at its own expense,
the fee of the Sub-Advisor. Calvert Asset Management Company, Inc. and the
Sub-Advisor may earn (or have their fees reduced by) performance fee
adjustments based on the extent to which the Portfolio exceeds or trails the
Lipper Balanced Funds Index. The performance adjustment could cause the annual
rate to be as high as .85% or as low as .55% of average net assets.
A complete description of the fees and expenses paid by the Investment Company
Funds, the Fidelity Portfolios, the Scudder Portfolios, the American Century
VP Capital Appreciation Fund and Calvert Responsibly Invested Balanced
Portfolio is found in their respective prospectuses attached to this
Prospectus.
THE GROUP AND INDIVIDUAL ANNUITY CONTRACTS
GENERAL
TDA and VEC Contracts. TDA and VEC Contracts are issued by the Insurance
Company to Contractholders seeking a funding vehicle for group annuity
purchase plans. Any employee of an employer which has adopted a Plan funded by
a TDA Contract is eligible to become a Participant under the Contract, as of
the effective date of the Contract or the first day of any calendar month
thereafter, by making an application to the Insurance Company on its
prescribed form. As a result of the Tax Reform Act of 1986, the Insurance
Company has amended its VEC Contracts so that no Contributions on or after
January 1, 1987 may be made. The VEC Contract may be continued for existing
accounts and may be used to accept transfers from other plans or carriers.
IRA Contract. IRA Contracts are issued to eligible individuals who complete
the prescribed application, make an initial Contribution of an amount
specified by the Insurance Company from time to time, and are accepted for
participation by the Insurance Company. The contribution requirement will be
waived for IRA contracts issued in connection with a SEP. Employees of
organizations qualifying for tax-exempt status under the Code, and their
spouses, are eligible to apply for an IRA Contract. To purchase an IRA issued
in connection with a SEP or SIMPLE, an individual must be eligible to
participate in a SEP or SIMPLE adopted by the individual's employer.
FPA Contract. FPA Contracts are issued, upon completion of the prescribed
application and payment of an initial Contribution of an amount specified by
the Insurance Company from time to time, to individuals, their spouses and
certain family members now or formerly affiliated with organizations that are
tax-exempt under the Code. The Contract may also be issued to such a tax-
exempt organization itself, which may use the Contract to accumulate funds for
subsequent payment of deferred compensation obligations of the organization.
The person to whom an FPA Contract is issued, whether or not such person is
the Annuitant, will be the owner of the Contract, and will possess all the
rights thereunder. (For example, the
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employer to whom an FPA Contract is issued for deferred compensation purposes
is the owner of the Contract, and entitled to all payments thereunder.)
Cancellation of Contract. A TDA Certificate, IRA Contract or FPA Contract may
be surrendered for cancellation within ten days after receipt. The Insurance
Company will refund all Contributions allocated to the General Account without
deductions plus the value on the date of surrender of all Contributions
allocated to the Separate Account. Several states, however, require that all
Contributions be refunded without deductions. You should consult the Contract
for applicable provisions.
PAYMENT OF CONTRIBUTIONS
TDA Contracts. Contributions ordinarily are made, as elected by Participants,
pursuant to salary reduction arrangements. However, a single sum transfer from
another group annuity contract funded by the Insurance Company, or from any
tax-deferred annuity plan maintained under Section 403(b) of the Code or
certain custodial accounts maintained under Section 403(b)(7) of the Code
generally will also be acceptable on behalf of a Participant.
The amount of any Contributions with respect to a Participant may not be less
than $200 on an annual basis nor greater than any amount permitted under
applicable state or Federal law (see "Federal Tax Matters"). No further
Contributions may be made on behalf of a Participant who has terminated
participation under the Contract nor by a Participant under a TDA Contract
that has been discontinued.
VEC Contracts. A Contractholder can remit to the Insurance Company on behalf
of a Participant, in a single sum, an amount that arises from a transfer from
another voluntary employee contribution plan, or from a contract between a
Contractholder and the Insurance Company, or between the Contractholder and
another insurance company. Contributions may not be made on behalf of a
Participant under a VEC Contract on and after January 1, 1987.
IRA Contracts. For Regular IRA and SEP IRA Contracts, a Participant may make
Contributions directly to the Insurance Company. Under a Regular IRA Contract,
a Participant also may make Contributions under a payroll deduction agreement
between the Participant and the Participant's employer, in which case the
employer forwards to the Insurance Company on behalf of the Participant the
amounts deducted from the Participant's salary. For a SIMPLE IRA Contract, a
Participant may make Contributions only by salary reduction under the SIMPLE
adopted by the Participant's employer.
The maximum amount of a Participant's Contributions under a Regular IRA or SEP
IRA Contract during a Participant's tax year cannot be greater than $2,000 (or
100% of compensation if less). Employees who are covered by a SEP can
contribute to the SEP IRA or another IRA contract up to the maximum of $2,000
per year.
A Participant may make Contributions to a SIMPLE IRA of up to $6,000 per year
(or 100% of compensation if less). The $6,000 limit will be adjusted for cost-
of-living increases in the future. If an individual has more than one
employer, the maximum amount that an employee may contribute under a SIMPLE
IRA and other salary reduction arrangements in any year is $9,500 (for 1997,
to be adjusted for cost-of-living increases in the future). The employee's
contributions are made through a salary reduction agreement with the employer
that the employee may terminate at any time.
Employer contributions are limited by the Code for both SEP IRAs and SIMPLE
IRAs. Under a SEP, an employer can contribute to the employee's SEP IRA an
amount up to 15% of the employee's compensation (with compensation limited to
$160,000), but not more than $30,000. These limits may be reduced, however, by
contributions that the employer makes to other tax-qualified plans for the
Participant. Under a SIMPLE, an employer generally must match an employee's
contribution in an amount equal to 3% of the employee's compensation, but the
employer may lower the percentage to as low as 1% for two years out of a five
year period. Instead of making a matching Contribution, the employer may make
a "nonelective contribution" to each SIMPLE IRA under the plan. The amount of
the nonelective contribution is equal to 2% of compensation for each eligible
employee, whether or not the employee has made Contributions during the year.
The maximum amount of compensation considered for each employee in this
calculation is $160,000 (for 1997, to be adjusted for cost-of-living increases
in the future). An employer must notify its employees of an election to reduce
the percentage of the employer's matching Contributions or to make a
nonelective contribution instead of matching contributions for the coming
year.
A Participant may not make any Contributions to a Regular IRA or SEP IRA
Contract beginning in the tax year the Participant reaches age 70 1/2.
However, an individual may purchase an IRA Contract, or a Participant may use
an existing IRA Contract, to receive "roll over" Contributions from certain
other plans, as described below, even after age 70 1/2. In addition, an
employer may make contributions for its employee under a SEP IRA or a SIMPLE
IRA, and an employee may contribute to a SIMPLE IRA, after the employee has
attained age 70 1/2.
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A Participant may make Contributions to an IRA Contract (other than a SIMPLE
IRA) by "roll over" from certain other pension or retirement arrangements that
qualify for favorable tax treatment under the Code. Generally, amounts that a
Participant rolls over will not be subject to the limitations on the amount of
Contributions during a tax year, except for the portion that represents
Contributions made for the same tax year as the roll-over. Qualified plans and
arrangements include other IRA contracts, SEP IRAs and SIMPLE IRAs, tax-
sheltered annuities under Code Section 403(b), and pension and profit-sharing
plans, including 401(k) plans, under Code Section 401(a). Not all
distributions from these plans and arrangements may be rolled over to an IRA
Contract, and the tax implications of rolling over distributions may vary
depending on federal tax rules that apply to the plan or arrangement. See
"Obtaining Tax Advice". A Participant may roll over amounts to a SIMPLE IRA
only from another SIMPLE IRA.
FPA Contract. Contributions are made by a Participant directly to the
Insurance Company or by the Participant's employer under a salary deduction
agreement, at whatever intervals and in whatever amounts are desired, except
that the amount of any Contribution may not be less than the minimum set by
the Insurance Company, currently $10. If prior to the Annuity Commencement
Date no Contributions are made by a Participant for three consecutive years,
the Participant's Account Balance is less than $500, and the Participant has
attained age 59 1/2, the Insurance Company may, in its sole discretion, return
the Participant's Account Balance and terminate the Contract.
Acceptance of Initial Contributions. If an initial Contribution is received
together with a completed application and other necessary information, it will
be accepted within two business days of receipt. If the application is not
duly completed, the Insurance Company will retain the Contribution for up to
five business days while attempting to obtain the information necessary to
complete the application; the Contribution will then be accepted within two
business days of receipt of the completed application. If a completed
application is not received within five business days, however, the Insurance
Company will return the Contribution at the end of that period, unless the
individual applicant (under an FPA or IRA Contract where Contributions are
remitted directly by the Participant), Contractholder (under TDA or VEC
Contracts), or employer (under an IRA Contract where Contributions are
remitted by the Participant's employer) consents to the Insurance Company
holding the Contribution until additional information is provided.
Limitation on Deferrals. FPA Contracts used as a depository for employee
deferred compensation obligations in connection with such obligations which
come into existence after August 16, 1986 and which are not "eligible"
deferred compensation plans as defined in Section 457(b) of the Code, are
subject to the provisions of Section 457(f), including substantial risk of
forfeiture.
ALLOCATIONS OF CONTRIBUTIONS
Contributions under the Contract may be allocated in whole or in part among
the General Account and the sixteen Funds of the Separate Account.
Contributions will be allocated on the basis of a request made to the
Insurance Company and currently on file at its home office (see "General
Matters--Contacting the Insurance Company"). A Participant's request for
allocation will specify the percentage, in any whole percentage from 0% to
100%, of each Contribution to be allocated to each of the Investment
Alternatives. The request for allocation of Contributions among the Investment
Alternatives may be changed from time to time, and amounts may be transferred
among those alternatives. A Participant should make periodic reviews of all
allocations in light of market conditions, the Participant's retirement plans,
and overall estate planning requirements.
ACCUMULATION UNITS
Contributions under the Contracts, other than initial Contributions, which are
allocated to the Separate Account on behalf of a Participant, will be credited
to an individual accumulation account maintained for such Participant with
respect to each of the chosen Funds of the Separate Account in the form of the
Accumulation Units as of the Valuation Period during which the Contributions
are received by the Insurance Company. The number of Accumulation Units in a
Fund of the Separate Account credited to the account of a Participant is
determined by dividing the amount allocated to that Fund of the Separate
Account on behalf of such Participant by the Accumulation Unit value for that
Fund of the Separate Account for the Valuation Period during which the
Contribution is received. The value of the Accumulation Units of each Fund of
the Separate Account will vary with the investment experience of that Fund.
The number of Accumulation Units in a Participant's individual account will
fluctuate in accordance with amounts allocated to or withdrawn from the Funds
of the Separate Account. The net change in Accumulation Units is determined by
adjusting the number of Accumulation Units in the Funds of the Separate
Account as of the end of the previous Valuation Period by adding or deducting
Accumulation Units with respect to Contributions made to or amounts withdrawn
from the respective Funds of the Separate Account during that Valuation
Period. The number of Accumulation Units to be so added or deducted is the
number obtained by dividing the amounts so allocated or withdrawn by the
Accumulation Unit value for that Valuation Period.
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The Accumulation Units in each Fund of the Separate Account are valued
separately. The value of an Accumulation Unit in each Fund of the Separate
Account corresponding to a Fund of the Investment Company originally was set
arbitrarily at one dollar. The value of an Accumulation Unit in the Fund of
the Separate Account corresponding to one of the Fidelity Portfolios, Scudder
Portfolios, American Century VP Capital Appreciation Fund (formerly known as
the TCI Growth Fund) or Calvert Responsibly Invested Balanced Portfolio
originally was established by deducting expenses of the Separate Account
applicable to that portfolio or fund from the applicable unit value
established by the respective Portfolio Company portfolio or fund or series as
of the end of the last Valuation Day immediately preceding the day when the
first investment was made by the Separate Account in the Portfolio Company
portfolio or fund. For any Valuation Period, the value of an Accumulation Unit
in a Fund of the Separate Account is the amount obtained by multiplying the
value of an Accumulation Unit in that Fund as of the preceding Valuation
Period, by that Fund's Accumulation Unit Change Factor (described below) for
that Valuation Period. The dollar value of an Accumulation Unit in each Fund
of the Separate Account, therefore, will vary from Valuation Period to
Valuation Period, depending on the investment experience of the Fund.
The Accumulation Unit Change Factor for each Fund of the Separate Account for
any Valuation Period is determined as:
(a) the ratio of (i) the asset value of that Fund at the end of the current
Valuation Period, before any amounts are allocated to or withdrawn from the
Fund with respect to that Valuation Period, to (ii) the asset value of the
Fund at the end of the preceding Valuation Period, after all allocations
and withdrawals were made for that period, divided by
(b) 1.000000 plus the component of the annual rate of mortality and expense
risk, distribution expense and administrative charges (which does not
include the monthly administrative charge per Participant which is $2.00
but in no event to exceed 1/12 of 1% of the Account Value in any month)
against a Fund's assets for the number of days from the end of the
preceding Valuation Period to the end of the current Valuation Period (see
"Charges").
The value of the Accumulation Units credited to the account of a Participant
in the Separate Account for any Valuation Period prior to the Annuity
Commencement Date is determined by multiplying the number of Accumulation
Units credited to such Participant in each chosen Fund of the Separate Account
by the Accumulation Unit value for each chosen Fund at the end of the
Valuation Period.
TRANSFERS AMONG INVESTMENT ALTERNATIVES
Prior to the Annuity Commencement Date, Participants may elect, subject to the
conditions described below, to transfer amounts among Investment Alternatives.
Thus, amounts may be transferred among Funds of the Separate Account, and
between the Separate Account and the General Account. A Participant may
express the amount sought to be transferred as a dollar amount, or as a number
of Accumulation Units, or as a percentage of the value of the Participant's
investment in the selected Investment Alternative. Transfers may not be made
after the Annuity Commencement Date. No charges are currently imposed for
transfers, but the Insurance Company reserves the right to impose such charges
in the future.
Any transfers from a Fund of the Separate Account will result in the
cancellation of Accumulation Units in that Fund on the basis of the current
Accumulation Unit value for the Valuation Period during which the request is
received. Transfers to a Fund of the Separate Account from either the General
Account or another Fund of the Separate Account will be credited to that Fund
based on the current Accumulation Unit value for the Valuation Period during
which the transferred amount is received (see "Postponement of Payments").
No request for a transfer will be binding on the Insurance Company until it
receives all information necessary to process the request.
WITHDRAWALS
A Participant may (unless, under a TDA or VEC Contract, a Plan provides
otherwise), prior to the Annuity Commencement Date, elect to withdraw the
Participant's Account Balance in whole or in part. To be valid, a partial
withdrawal request must specify from which of the Investment Alternatives the
withdrawal is to be made. A Participant may express the amount sought to be
withdrawn as a dollar amount, a number of Accumulation Units, or a percentage
of the value of the Participant's investment in the selected Investment
Alternative. No withdrawals are permitted after the Annuity Commencement Date.
The withdrawal or distribution of funds from a TDA Plan is subject to
restrictions. In general, a Participant under age 59 1/2 will not be able to
withdraw or receive a distribution of either Contributions made on and after
January 1, 1989 under a salary reduction agreement, or interest and investment
earnings credited such contributions, on and after January 1, 1989, except in
specified circumstances. These circumstances generally include death or
disability, hardship, and termination of employment. If a Participant makes a
withdrawal for hardship, he may not withdraw the post-1988 earnings on the
amounts which were contributed under a salary reduction agreement. In
addition, spousal consent may be required for withdrawals.
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In the case of either a partial or complete withdrawal from the Separate
Account, the Insurance Company will pay to the requesting Participant the
lesser of (a) the amount specified in the withdrawal request or (b) the amount
that, as of the date the Insurance Company received the withdrawal request,
represents the value of the Accumulation Units credited to the account of the
Participant in the Funds of the Separate Account from which withdrawal is
sought. The Investment Company will reduce the number of Accumulation Units
credited to the account of a Participant by the number of Accumulation Units
obtained by dividing the amount withdrawn from that Fund by the Accumulation
Unit value in effect for the Valuation Period during which the request is
received.
Loans. The Insurance Company will make available to the employer a TDA or VEC
loan option. If the employer elects to adopt the loan provision in the
Contract, Participants shall have the right to borrow funds utilizing TDA or
VEC Plan Account Balances as collateral. The amount of the loan permitted is
governed by Section 72(p) of the Code and the Regulations thereunder and the
Contract terms. An amount sufficient to serve as loan collateral will be
transferred from the Separate Account to the General Account, if appropriate,
and withdrawals and transfers of such collateral will not be permitted while
the loan is outstanding.
No request for withdrawal will be binding on the Insurance Company until it
receives all information necessary to process the request.
Other Considerations. Currently, withdrawals under the Contracts, whether
complete or partial, are not subject to any contingent deferred sales charge,
or any other withdrawal charge. The Insurance Company reserves the right,
however, to impose such charges in the future.
Participants should consider the possible Federal income tax consequences of
any withdrawal. Generally, a Participant will be taxed at ordinary income tax
rates on the amount withdrawn (subject to the non-taxable recovery of prior
non-deductible contributions). In addition, certain withdrawals may be subject
to a tax penalty (see "Federal Tax Matters").
SPECIFIED PAYMENTS OPTIONS
A Participant in a TDA, VEC or IRA Contract may elect after attaining age 59
1/2 (or, in the case of a TDA or VEC Contract, early retirement after age 55)
to specify an amount (which may not be less than $100) to be withdrawn from
the Participant's Account Balance and paid each month to the Participant (see
"General Matters--Contacting the Insurance Company"). The withdrawals and
payments will be made, as designated by the Participant, from either the
General or Separate Account, or both (see "Postponement of Payments").
During the period that payments under the Specified Payments Option
("Specified Payments") are received by a Participant, Contributions may be
made on that Participant's behalf. In addition, transfers of amounts among
Investment Alternatives and other withdrawals from a Participant's account may
continue to be made (see "Transfers Among Investment Alternatives" and
"Withdrawals").
Specified Payments will continue until (a) the death of the Participant; (b)
receipt by the Insurance Company of the Participant's written request to
modify or discontinue the specified payments; (c) depletion of the
Participant's Account Balance, or of any portion thereof, so that the
remaining balance is insufficient to pay the next installment coming due; or
(d) the attainment of the Participant's Annuity Commencement Date.
Tax Consequences. Participants should consider the possible Federal income tax
consequences of electing the Specified Payments Option. Generally, a
Participant will be taxed at ordinary income tax rates on each Specified
Payment subject to non-taxable recovery of prior non-deductible Contributions.
In addition, payment may be subject to a tax penalty (see "Federal Tax
Matters").
A Participant receiving payment pursuant to the Specified Payments Option may
cancel those payments at any time and elect to receive the Participant's
Account Balance as a single sum payment.
If the Participant is subject to the minimum distribution rules of Section
401(a)(9) of the Code, the minimum Specified Payments for the year must at
least total the required annual distribution.
DEATH BENEFITS
Death benefits generally will be paid in accordance with the following rules
under IRA, TDA, VEC and FPA Contracts in which the Participant is the
Annuitant. Under an FPA Contract in which the Annuitant is not the
Participant, the following rules will apply as if the Annuitant were the
Participant.
Death After Annuity Commencement. If a Participant dies on or after his or her
Annuity Commencement Date, the Participant's designated beneficiary will be
entitled to receive the death benefit (if any) provided by the form of annuity
in
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effect on the Participant's date of death (see "The Annuity Period--Available
Forms of Annuity" and "General Matters--Designation of Beneficiary").
Death Prior to Annuity Commencement. If a Participant dies prior to the
Annuity Commencement Date, the Insurance Company will pay a death benefit to a
designated beneficiary (see "General Matters--Designation of Beneficiary").
Under employer-maintained TDA and VEC Contracts, the death benefit will be
paid to the spouse unless elected otherwise with spousal consent.
The death benefit will be paid by the Insurance Company after it has received
(1) due proof of death; (2) notification of an election by the beneficiary of
the form in which the death benefit is to be paid; and (3) all other
information and documentation necessary to process the death benefit request.
The amount of the death benefit will be the value of the Participant's Account
Balance as of the date on which the Insurance Company receives such
information. Until the Insurance Company receives the items in (1)-(3), the
Participant's Account Balance will remain allocated as it was on the date of
death of the Participant (unless the beneficiary is the spouse and special
rules apply).
The beneficiary may choose to receive the death benefit under any of the
following methods of payment: (1) a lump sum, (2) an annuity in a form offered
by the Insurance Company at the time the election is made, or (3) monthly
payments of a specified dollar amount (at least $100) as elected by the
beneficiary, such payments to continue until the death of the beneficiary or
until all benefits are paid; upon the death of the beneficiary, any amounts
remaining unpaid will be paid to the beneficiary's estate.
Any method of distribution selected by the beneficiary must comply with one of
the following rules:
(a) Five Year Rule. Unless (b), (c) or (d) below apply, the entire value of
the death benefit must generally be distributed to the beneficiary within
five years of the Participant's death. Special rules apply if the
beneficiary is the Participant's surviving spouse (see "Federal Tax
Matters--Obtaining Tax Advice").
(b) Life Annuity Rule. Unless (a), (c) or (d) apply, the entire value of the
death benefit must generally be distributed to the beneficiary in the form
of annuity payments commencing within one year of the Participant's death
and payable over a period of time that does not exceed the beneficiary's
life or life expectancy (whichever is longer). Special rules apply if the
beneficiary is the Participant's surviving spouse (see "Federal Tax
Matters--Obtaining Tax Advice").
(c) Commencement of Minimum Distributions. If a Participant under an IRA, TDA
or VEC Contract dies prior to the Annuity Commencement Date, but after he
or she has begun to receive required minimum distributions from the
Contract, the method of distribution selected by the beneficiary after the
Participant's death may not be slower than the method of distribution that
was in effect before the Participant died, unless (d) applies (see
"Federal Tax Matters--Other Matters").
(d) Alternative Method of Distribution. A beneficiary will not be required to
receive a distribution from an IRA or TDA Contract under (a), (b) or (c)
to the extent that the required distribution is withdrawn from another
contract of the same type in accordance with applicable IRS regulations
(see "Federal Tax Matters--Obtaining Tax Advice").
DISCONTINUANCE AND TERMINATION
DISCONTINUANCE OF TDA AND VEC CONTRACTS
TDA and VEC Contracts provide that a Contractholder may discontinue a
Contract, at its discretion, as of the first day of a calendar month that is
at least 31 days after notice of such intention to discontinue is received by
the Insurance Company. The Insurance Company may discontinue a TDA or VEC
Contract, in whole or in part, if (1) the Contractholder fails to abide by the
terms or requirements of the Contract, or (2) the Insurance Company determines
that a modification of the Contract is necessary to comply with Federal or
state requirements, including the Employee Retirement Income Security Act of
1974, as amended, and the Contractholder refuses to accept a substantially
similar contract offered by the Company that incorporates that modification.
Discontinuance of a Contract by the Insurance Company will be effective as of
a date specified by the Insurance Company, provided that the Insurance Company
must give a Contractholder at least 31 days' advance written notice in which
to cure any remediable defaults. In addition, the Insurance Company has the
right to discontinue a TDA or VEC Contract if, during any Plan Year, no
Contributions are made on behalf of any of the Participants.
Discontinuance of a TDA or VEC Contract will not relieve the Contractholder of
its obligations under the Contract, nor will it deprive Participants of the
amounts accumulated on their behalf, which remain allocated to them, and all
provisions of the Contract will continue to apply, except that (1) no further
Contributions will be made by the Contractholder, and (2) the Insurance
Company may transfer to another insurance company or other financial
institution all amounts accumulated under the Contract and allocated to
Participants and beneficiaries. Such transfer may be made in any manner to
which the Contractholder and the Insurance Company agree in writing, and to
the extent consented to by any Participant or beneficiaries. In the event of a
transfer described in clause (2) above, amounts accumulated for the benefit of
a Participant or beneficiary, who does not consent to the transfer may, as
elected by that person, be left on deposit with the Insurance Company, or
withdrawn in whole or in part (see "Withdrawals").
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TERMINATION OF PARTICIPATION UNDER TDA CONTRACTS
If, during the Accumulation Period, a TDA Contract Participant is no longer
eligible to participate under the Contract for any reason other than death or
retirement (for example, due to termination of employment), or if notice is
given that the Participant no longer desires to participate under the
Contract, a termination with respect to that Participant will be deemed to
have occurred. In addition, if no Contributions are made by a Participant for
three consecutive years and the Participant's Account Balance is less than
$2,000, the Insurance Company, in its discretion, may deem that such a
termination has occurred. Upon receipt by the Insurance Company, or a
Participant (where the Insurance Company deems a termination to have
occurred), of notice of termination, Contributions may no longer be made on
behalf of a Participant. Termination will not deprive a Participant of the
amounts accumulated on the Participant's behalf, or the Participant's rights
to make transfers or withdrawals (see "Transfers Among Investment
Alternatives" and "Withdrawals"). Termination also will not prevent a
Participant from electing to receive annuity benefits (see "The Annuity
Period"), or having a death benefit paid on the Participant's behalf (see
"Death Benefits").
TERMINATION BY THE INSURANCE COMPANY
VEC Contract. Under VEC Contracts, if, on or before (1) the first anniversary
of the effective date of the Contract, or (2) such other date as may be
communicated to the Contractholder by the Insurance Company, the
Contractholder does not provide evidence satisfactory to the Insurance Company
that the Plan pursuant to which the Contract is issued qualifies for the tax
treatment specified under Sections 401(a) and 403(a) of the Code, then
(a) no further amounts may thereafter by remitted under the Contract on
behalf of Participants;
(b) the Insurance Company will withdraw and pay to the Contractholder the
amounts accumulated under the Contract as of the date of withdrawal; and
(c) upon such withdrawal and payment, the Insurance Company will terminate
the Contract.
IRA and FPA Contracts. The Insurance Company may, in its sole discretion,
return a Participant's Account Balance and terminate an IRA or FPA Contract
prior to the Annuity Commencement Date if no Contributions have been made by
Participant for three consecutive years, the Participant's Account Balance is
less than a specified minimum, and the Participant has attained age 59 1/2.
For FPA Contracts the specified minimum Account Balance is $500. For IRA
Contracts the specified minimum is either $2,000 or the amount necessary to
provide monthly Annuity Payments of at least $20 under the form of annuity
selected by the Participant. The Insurance Company will not exercise its
option to terminate an IRA or FPA Contract without notifying the Participant
of the Insurance Company's intention to do so, and providing a period of 90
days during which additional Contributions may be made for the purpose of
reaching the required minimum Account Balance and avoiding termination.
Amounts withdrawn in connection with the termination of an IRA or FPA Contract
will be paid to the Participant in a single sum.
POSTPONEMENT OF PAYMENTS
Payment of any amounts due from the Separate Account in connection with a
withdrawal, payment pursuant to the Specified Payment Option, death benefit,
termination, or transfer of any amount from the Separate Account to the
General Account will occur within seven days, unless:
1. The New York Stock Exchange is closed for other than usual weekends or
holidays, or trading on that Exchange is restricted as determined by the
Commission; or
2. The Commission by order permits postponement for the protection of
Participants; or
3. An emergency exists, as determined by the Commission, as a result of which
disposal of securities is not reasonably practicable or it is not reasonably
practicable to determine the value of the Separate Account's net assets.
THE ANNUITY PERIOD
GENERAL
As of the Annuity Commencement Date, the amount credited to a Participant in
the Separate Account will be transferred to the General Account and, together
with any amount previously credited to the Participant in that Account, will
be applied to provide a monthly annuity benefit. The amount of each Annuity
Payment will be fixed and guaranteed by the Insurance Company in accordance
with the tables of annuity purchase rates contained in the Contracts.
The level of Annuity Payments made to Annuitants under the Contracts will not
be affected by the mortality experience (death rate) of persons receiving such
payments, or of the general population. The Insurance Company assumes the
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"mortality risk" by virtue of the annuity purchase rates incorporated in the
Contract. In addition, the Insurance Company guarantees that it will not
increase charges under the Contracts with respect to Annuity Payments
regardless of its actual expenses.
Accordingly, Annuity Payments will be made in a fixed and guaranteed amount
that is in no way dependent upon the investment experience of the Separate
Account. The amount of monthly payments depends only on the form of annuity
chosen, the applicable annuity purchase rates contained in the Contract and
the total amount applied to purchase the annuity.
Once Annuity Payments have commenced with respect to a Participant, no further
Contributions may be made on behalf of that Participant. In addition, neither
transfers to the Separate Account, nor withdrawals of any kind, are permitted
on behalf of an Annuitant receiving Annuity Payments.
A Participant may elect to receive the Participant's Account Balance as of the
Annuity Commencement Date in a lump sum in lieu of receiving Annuity Payments.
The Insurance Company will issue to Contractholders of TDA and VEC Contracts
for delivery to each Participant thereunder an individual certificate setting
forth the amount and terms of payment of their annuity benefits. The benefits
to which an IRA or FPA Contract Participant is entitled generally are set
forth in the Contract issued to the Participant.
Payment of benefits under the Contracts will be made by the Insurance Company
directly to Annuitants at their last known address filed with the Insurance
Company by a Participant or Contractholder.
ANNUITY COMMENCEMENT DATE
The Annuity Period with respect to a Participant may begin on the Annuity
Commencement Date selected in the following manner:
TDA and VEC Contracts. Participants under TDA and VEC Contracts may elect an
Annuity Commencement Date that is either such Participant's Normal Retirement
Date (the first day of the calendar month coincident with or next following
such Participant's 65th birthday); Early Retirement Date (the first day of any
calendar month within the ten-year period immediately preceding the
Participant's Normal Retirement Date, but no earlier than age 55); or Later
Retirement Date (the first day of any calendar month following such
Participant's Normal Retirement Date) but with respect to VEC Contracts,
generally no later than age 70 for Participants who are no longer actively at
work.
IRA Contract. A Participant may elect an Annuity Commencement Date that is the
first day of any calendar month that is on or after the date on which the
Participant attains age 55. For SEP-IRAs and SIMPLE IRAs, the Annuity
Commencement Date must be no earlier than the latest of the following: the
first day of the calendar month in which the Participant attains age 55, the
30th day following the day the Participant stops working for the employer that
sponsors the SEP or SIMPLE, and the 30th day following the day that the last
employer contribution due under the SEP or SIMPLE is received at the Insurance
Company's home office.
FPA Contract. A Participant may elect an Annuity Commencement Date that is the
first day of any calendar month.
Annuity Commencement Date elections must be made in advance, in the manner
described under "General Matters--Contacting the Insurance Company." For IRAs
and SEP-IRAs, such election must be made 30 days in advance.
AVAILABLE FORMS OF ANNUITY
Annuity Payments will be made under one of the forms of annuity benefits
described below. Under TDA and VEC Contracts, unless an election to the
contrary is made prior to the Annuity Commencement Date, a Participant who
does not have an Eligible Spouse at the Annuity Commencement Date will have
annuity benefits paid in the Ten Years Certain and Continuous Form described
below, and a Participant who has an Eligible Spouse will have annuity benefits
paid on the Joint and Survivor Form described below. Under the VEC and some
employer sponsored TDA plans, consent of the spouse is required if payment is
to be made in any form other than the joint and survivor form. Under IRA and
FPA Contracts, the form in which Annuity Payments will be made is the form
selected by a Participant at the time the Participant designates an Annuity
Commencement Date. The forms of annuity offered by the Insurance Company are:
Ten Years Certain and Continuous Form. An annuity payable monthly until the
first day of the month in which the death of the Participant occurs, or, the
end of the specified period of 120 months, whichever is later. If the
Participant dies prior to the end of the specified period, payments in the
same amount will be continued to the Participant's beneficiary until the end
of that period (see "General Matters--Designation of Beneficiary"). If the
Participant elects this form and dies before the Annuity Commencement Date,
the election will be cancelled.
Joint and Survivor Form. An annuity payable monthly until the first day of the
month in which the death of the survivor of the Participant and the
Participant's Eligible Spouse occurs or the end of a period of 120 months,
whichever is later. If the
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Participant dies during the Annuity Period, and the Eligible Spouse is living,
payments in the amount of 66 2/3% of those payable to the Participant will be
made to the Eligible Spouse. If the Eligible Spouse dies prior to the end of
the specified period, payments will be made to the Participant's beneficiary
(see "General Matters--Designation of Beneficiary"). Under TDA and VEC
Contracts, a Participant who has an Eligible Spouse at the Annuity
Commencement Date will be presumed to have elected this annuity option unless
the Participant notifies the Insurance Company to the contrary within ninety
days prior to that date. If the Eligible Spouse dies before the Participant's
Annuity Commencement Date, the election of this form of annuity will be
automatically cancelled, and the Ten Years Certain and Continuous Form will be
paid unless the Participant elects an alternate form prior to the Annuity
Commencement Date.
Full Cash Refund Form. An annuity payable monthly until the first day of the
month in which the death of the Participant occurs. If, at the date of the
Participant's death, the total amount of the annuity benefits received by the
Participant is less than the amount of the Participant's Account Balance as of
the Annuity Commencement Date, the difference between these two amounts will
become payable in cash as a death benefit to the Participant's beneficiary.
Such death benefit may be paid in a lump sum, or as an annuity in the Ten
Years Certain and Continuous Form, or in a combination thereof, as elected by
the beneficiary (see "General Matters--Designation of Beneficiary").
AMOUNT OF ANNUITY PAYMENTS
The amount of monthly Annuity Payments under the Contracts will be determined
on the basis of the application of the Participant's Account Balance to the
annuity purchase tables contained in the Contracts in accordance with the form
of annuity benefit selected. The Insurance Company guarantees that the rates
used to determine the amount of Annuity Payments will never be less favorable
for an Annuitant than the guaranteed rate provided in the Contracts.
SMALL BENEFIT PAYMENTS
TDA and VEC Contracts. Under TDA and VEC Contracts, if the initial monthly
payment under an annuity benefit payable under the Contract would be less than
$20, or if any Participant terminates employment and is eligible for a benefit
determined to be less than $20 a month under the Ten Years Certain and
Continuous Form of Annuity (described above), the Insurance Company may, at
its option, in lieu of making the monthly annuity benefit payments which would
otherwise be payable to the Participant commencing on the Participant's
Annuity Commencement Date, pay to the Participant on the Participant's Annuity
Commencement Date in a single sum the actuarially equivalent value of the
Participant's monthly annuity benefit that would otherwise be payable on the
Ten Years Certain and Continuous Form, provided that single sum does not
exceed $3,500 (or such other maximum amount that may hereafter be provided by
law). The Insurance Company may make this payment as of any date that is on or
before the Participant's Annuity Commencement Date. Under VEC Contracts, for
purposes of determining whether monthly annuity benefits payable to a
Participant are less than $20, a Participant's monthly annuity benefits will
be deemed to include any annuity benefit paid with respect to that Participant
under any other Contract between the Contractholder and the Insurance Company
or between the Contractholder and another insurance company that serves as the
funding vehicle for a pension plan meeting the requirements of Section 401(a)
and 403(a) of the Code.
IRA and FPA Contracts. Under IRA and FPA Contracts, if the annuity benefit
payable is less than $20 each month, the Insurance Company may, at its option,
pay the present value of the annuity benefit in one payment to the Annuitant.
THE GENERAL ACCOUNT
Contributions allocated and transfers made to the Insurance Company's General
Account become part of the general assets of the Insurance Company, which
support insurance and annuity obligations. Because of exemptive and
exclusionary provisions, interests in the General Account have not been
registered under the Securities Act of 1933 ("1933 Act") nor is the General
Account registered as an investment company under the 1940 Act. Accordingly,
neither the General Account nor any interests therein are subject generally to
the provisions of the 1933 or 1940 Acts and the Insurance Company has been
advised that the staff of the Commission has not reviewed the disclosures in
this Prospectus which relate to the General Account. Disclosures regarding the
fixed portion of the Contracts and the General Account, however, may be
subject to certain generally applicable provisions of the Federal securities
laws relating to the accuracy and completeness of statements made in
prospectuses.
SCOPE OF PROSPECTUS
The Contracts provide for accumulation of Contributions on a completely fixed
basis, a completely variable basis, or a combination fixed and variable basis,
and for the payment of annuity benefits on a fixed basis only. This
Prospectus,
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however, is generally intended to serve as a disclosure document for the
variable portion of the Contracts only. For complete details regarding the
General Account, see the Contracts themselves.
GENERAL DESCRIPTION
The General Account consists of all of the general assets of the Insurance
Company, other than those in the Separate Account and other segregated asset
accounts. Amounts are allocated to the General Account at the election of
Participants in the form of Contributions, or as transfers from the Separate
Account. The Insurance Company bears the full investment risk for all amounts
allocated to the General Account (whereas Participants bear the investment
risk for amounts allocated to the Separate Account). The Insurance Company has
sole discretion to invest the assets of the General Account, subject to
applicable law. There are no limits on withdrawals or transfers to another
Investment Alternative from the General Account (subject to applicable federal
tax law restrictions, with respect to the amount a Participant can withdraw in
cash). The Insurance Company does not guarantee that this will always be the
case. The Insurance Company guarantees that it will credit interest to amounts
accumulated for Participants in the General Account at an effective annual
rate of at least 3%. The Insurance Company may, at its sole discretion, credit
a higher rate of interest to amounts allocated to the General Account,
although the Insurance Company IS NOT OBLIGATED TO CREDIT INTEREST IN EXCESS
OF 3% PER YEAR. Under TDA Contracts where employers elect to use electronic
media, such as a computer terminal, personal computer or other electronic
device located at the employer's place of business, to transmit and receive to
and from the Insurance Company, relevant and necessary information with
respect to the TDA contract, subject to the Insurance Company's established
rules and requirements with respect to accessing computer information, the
Insurance Company reserves the right to credit such contracts with a different
rate of interest in the General Account than contracts which do not use such
electronic computer processing. Any amount held in the General Account does
not entitle a Participant to share in the investment experience of the General
Account.
TRANSFERS AND WITHDRAWALS
Prior to a Participant's Annuity Commencement Date, amounts may be transferred
from the Funds of the Separate Account to the General Account, and from the
General Account to the Funds of the Separate Account. No charge is currently
imposed for such transfers. The Insurance Company reserves the right, however,
to impose additional charges on transfers in the future.
Partial or complete withdrawals may be made from the General Account prior to
a Participant's Annuity Commencement Date. In the case of such withdrawals,
the Insurance Company will pay the lesser of (a) the amount specified in the
withdrawal request, and (b) the amount that, as of the date of payment, then
represents the accumulation in the General Account credited to the
Participant. No charge is currently imposed on such transfers.
Transfers and withdrawals from the General Account may be delayed for up to
six months following the date that the Insurance Company receives such
requests. Withdrawals with respect to TDA or VEC Contracts may be subject to
written spousal consent under applicable rules.
ANNUITY PAYMENTS
All Annuity Payments under the Contracts are made in the form of a fixed
annuity from the General Account. The Insurance Company does not credit
discretionary interest in excess of the guaranteed rate of 3% to Annuity
Payments. The Annuitant must rely on the annuity purchase tables provided in
the Contracts to determine the amount of Annuity Payments.
GENERAL MATTERS
CONTACTING THE INSURANCE COMPANY
Except as provided in the following paragraph, all notices, requests and
elections required to be given or made under the Contracts must be in writing
and mailed or delivered to the Insurance Company's home office at the
following address:
Mutual of America Life Insurance Company
Thomas A. Harwood, Senior Vice President
320 Park Avenue
New York, New York 10022
or to your appropriate Regional Office. You can check the address for your
Regional Office by calling 1-800-468-3785.
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TRANSFERS, WITHDRAWALS AND REALLOCATIONS BY TELEPHONE
Requests by Participants for transfers or withdrawals, or changes in the
formula for allocation of Contributions, may be made by telephone in lieu of
the written procedure described above. Requests by telephone, however, may be
made only if a Participant has received a Personal Identification Number,
which the Insurance Company provides automatically, and agreed to use it in
accordance with the applicable rules and requirements. Thereafter, the
Participant may contact the Insurance Company by telephone (800-468-3785) and
request the desired transaction or change. Transfers requested by telephone
will go into effect on the day on which the request is made, if received by 4
P.M. Eastern Standard Time (or Daylight Savings Time, as applicable), at the
next calculated price. The Insurance Company reserves the right to suspend or
terminate the right to request transfers, withdrawals or reallocations by
telephone at any time. Because of requirements for written spousal consent,
telephone withdrawal under TDA and VEC Contracts may not be permitted.
Although failure to follow reasonable procedures may result in the Insurance
Company's liability for any losses due to unauthorized or fraudulent telephone
transfers, it will not be liable for following instructions communicated by
telephone that it reasonably believes to be genuine. The Insurance Company
will employ reasonable procedures to confirm that instructions communicated by
telephone are genuine. Those procedures shall consist of confirming the
Participant's Social Security number, checking the Personal Identification
Number, tape recording all telephone transactions and providing written
confirmation thereof.
DESIGNATION OF BENEFICIARY
Under the Contracts, a Participant may designate (with the right to change
such designation from time to time) a beneficiary to receive any payments with
respect to a Participant becoming due to a beneficiary under the Contract. The
Participant may change the beneficiary while the Participant is living by
providing the Insurance Company (or the Participant's Employer where the
Employer has agreed to retain such information) with written notice of such
change. Such designation or change in designation will take effect as of the
date of receipt of notice by the Insurance Company or the Participant's
Employer where the Employer has agreed to retain such information, whether or
not the Participant is living at the time of such receipt. The Insurance
Company will not be liable, however, as to any payment or settlement made
prior to receiving such notice.
In the case of a married Participant in a VEC Plan or an employer sponsored
TDA, the beneficiary shall be the Eligible Spouse unless, on the date of
death, there is in effect a written consent, signed by the Eligible Spouse and
witnessed either by a notary public or Plan representative, to such
Participant's election to waive any qualified preretirement survivor annuity
and qualified joint and survivor annuity forms of benefit which otherwise
would be applicable and designate a beneficiary other than such Eligible
Spouse. Such other beneficiary designation or form of benefit selected cannot
be changed by the Participant unless the Eligible Spouse provides written
consent in the manner described above.
If no designated beneficiary survives the Participant, the Insurance Company
will pay any single sum payment or the commuted value of any remaining
periodic payments to the first surviving class of the following classes of
successive preference beneficiaries: (a) the Participant's surviving spouse;
(b) the Participant's surviving children; (c) the Participant's surviving
parents; (d) the Participant's surviving brothers and sisters; and (e) the
executors or administrators of the Participant's estate. Any commuted value
will be determined on the basis of compound interest at a rate, determined by
the Insurance Company, that is consistent with the interest assumption of the
rates used to determine the amount payable under the annuity benefit (see
"Amount of Annuity Payments").
ASSIGNMENT OF CONTRACTS
TDA, VEC and IRA Contracts. Except as otherwise required by law, no assignment
of TDA, VEC or IRA Contracts, nor transfer of any rights conferred thereunder,
is permitted.
FPA Contract. An FPA Contract may be assigned by the person to whom it was
issued. However, no assignment will be binding on the Insurance Company until
it has been recorded by the Insurance Company, and no assignment will apply to
payments made before such recording.
THE INSURANCE COMPANY'S LIABILITY
The Insurance Company's liability for the payment of annuity benefits (see
"The Annuity Period"), death benefits (see "Death Benefits"), and withdrawals
(see "Withdrawals") is limited to the payments provided under the Contracts
that arise from Participants' Account Balances.
Upon exhaustion of all amounts held under a TDA or VEC Contract by withdrawals
or by transfers upon discontinuance of the Contract (see "Discontinuance and
Termination"), that Contract will terminate and the Insurance Company will be
relieved of all further liability thereunder, except with respect to any
annuity benefits provided on or before the date the Contract was terminated.
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Upon withdrawal and payment of a Participant's Account Balance upon
termination of an IRA or FPA (see "Discontinuance and Termination"), the
Insurance Company will be released from all further liability with respect to
that Participant.
The Insurance Company may rely on the reports and other information furnished
by Contractholders or Participants as required under the Contracts, and need
not inquire as to the accuracy or completeness of such reports and information
(see "Information and Determination").
MODIFICATION OF TDA AND VEC CONTRACTS
Neither TDA nor VEC Contracts may be modified as to the Insurance Company, nor
may any of the rights or requirements of the Insurance Company be waived,
except in writing and by a duly authorized officer of the Insurance Company.
A TDA or VEC Contract may be changed at any time by the Insurance Company by
written notice, amendment or replacement upon at least 31 days' written
advance notice to the Contractholder without the consent of any Participant,
or any other person who is, or may become, entitled to benefits under the
Contract, provided that such change shall not affect the amount or the terms
of the annuity benefits provided thereunder before such change.
AMENDMENT OF IRA CONTRACT
By accepting an IRA Contract, a Participant delegates to the Insurance Company
the power to amend or replace that Contract to conform it to the provisions of
any law, regulations, or material administrative rulings pertaining to
individual retirement annuities, and to make such other changes in the
Contract that, as determined by the Insurance Company, are from time to time
necessary or appropriate. No changes may be made without the consent of the
Participant, however, if the effect would be to change substantially the costs
or benefits under the Contract, and no amendment will affect the amount or
terms of any annuity benefit provided thereunder before the change. An
endorsement or amendment of an IRA Contract or a waiver of any of its
provisions will be valid only when made in writing by the Insurance Company
and signed by an officer of the Insurance Company.
EVIDENCE OF SURVIVAL
When payment of an annuity benefit is contingent upon the survival of any
person, evidence of that person's survival must be furnished to the Insurance
Company, either by the personal endorsement of the check drawn for payment, or
by other means satisfactory to the Insurance Company.
MISSTATEMENT OF INFORMATION
If a benefit provided under one of the Contracts was based on information that
has been misstated, the benefit will not be invalidated, but the amount of the
benefit payments or the amount applied to provide the benefit, or both, will
be adjusted to the proper amount as determined on the basis of the corrected
information.
The amount of any underpayments by the Insurance Company due to any
misstatement shall be paid in full with the next payment due with respect to
the Participant under the Contract. The amount of any overpayments by the
Insurance Company due to any misstatement will be deducted to the extent
possible from the payments thereafter falling due with respect to the
Participant. Interest, based on an annual effective rate of 5%, will be
included in the amount of any underpayments or overpayments.
INFORMATION AND DETERMINATION
Contractholders and Participants, as appropriate, will furnish the Insurance
Company with the facts and information that the Insurance Company may require
for the operation of the Contract including, upon request, the original or
photocopy of any pertinent records held by the Contractholder or Participant.
Any determination that a Contractholder is to make under a TDA or VEC Contract
will be made pursuant to the terms of the Contract and will be reported by the
Contractholder to the Insurance Company.
NON-ALIENATION OF BENEFITS UNDER VEC AND IRA CONTRACTS
To the extent permitted by law, no amount payable with respect to a
Participant under a VEC or IRA Contract may be assigned (either in law or at
equity), alienated or be subject to attachment, garnishment, levy (other than
a Federal tax levy made pursuant to Section 6331 of the Code), or other legal
or equitable process, and no such amount will in any way be subject to any
legal process which would subject it to the payment of any claim against the
Participant or beneficiary (see "Designation of Beneficiary").
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CLAIMS OF CREDITORS UNDER FPA CONTRACTS
To the extent permitted by law, no payment made by the Insurance Company
pursuant to an FPA Contract will be subject to the claims of any creditors. In
addition, no payment will be subject to any legal process to enforce any such
claim.
ALTERNATE PAYMENT OF BENEFITS
The Insurance Company may make payment due to a payee who is physically or
mentally incompetent to receive such payments, or is a minor, to certain other
persons in accordance with the Contracts. Upon making these alternate
payments, the Insurance Company will be discharged from all liability with
respect to payments due to the payee. Payments to a minor will be limited to
$250 a month until either (a) a guardian is appointed or (b) the minor has
attained majority.
CLAIM PROCEDURES UNDER TDA AND VEC CONTRACTS
In order to receive annuity benefits under TDA and VEC Contracts, Participants
or beneficiaries thereunder must bring to the attention of the Insurance
Company or the Contractholder such person's right to claim such benefits. If
the Contractholder has received the claim directly, the Contractholder must
notify the Insurance Company of the claim on the prescribed form furnished to
the Contractholder for that purpose. The Insurance Company will have 90 days
after receipt of the claim within which to render a decision, and may extend
this period, upon written notice to the claimant, for an additional 90 days if
there are special circumstances that require such an extension.
In the event a claim is denied in whole or in part, the Insurance Company will
give notice to the Contractholder or claimant, as appropriate, of such denial
in sufficient detail so that the claimant may be informed of the reason or
reasons for the denial, the specific reference to the Contract or Plan
provision on which the denial was based, any additional information that may
be necessary to perfect the claim and the reasons therefor, and the procedure
for reviewing denied claims.
In the event a claim is denied in whole or in part, a claimant or the
claimant's representative has 60 days in which to appeal to the Insurance
Company for review thereof. The request for review must be made in writing,
either directly to the Insurance Company, or to the Contractholder for
transmission to the Insurance Company. A claimant will have a right to review
all pertinent documents and to contest the decision in writing. The Insurance
Company will render a decision on review no later than 60 days after its
receipt of the request for review unless special circumstances require
extension, in which case the decision may, upon written notice to the
claimant, be rendered within 120 days from the Insurance Company's receipt of
the request for review. The Insurance Company's decision on review will be in
writing and include specific reasons with specific reference to the Contract
or Plan provisions on which it is based.
PARTICIPATION IN DIVISIBLE SURPLUS
The Insurance Company is a mutual life insurance company and, therefore, has
no stockholders. The Contractholders or Participants share in the earnings of
the Insurance Company. No assurance can be given as to the amount of divisible
surplus, if any, that will be available for distribution under the Contracts
in the future. The determination of such surplus is within the sole discretion
of the Insurance Company's Board of Directors. Under usual circumstances,
separate accounts receive little benefit from and contribute little to
divisible surplus.
FEDERAL TAX MATTERS
For Federal income tax purposes, the Separate Account is not an entity
separate from the Insurance Company, and its operations are considered part of
the Insurance Company. Accordingly, it will not be taxed separately as a
"Regulated Investment Company" under Subchapter M of the Code. Under existing
Federal income tax law, no taxes are due on the net investment income and
realized capital gains earned by the Separate Account. The Insurance Company
reserves the right to make a deduction for takes if in the future the
Insurance Company must pay tax on the Separate Account's operations.
PAYMENTS UNDER ANNUITY CONTRACTS GENERALLY
Section 72 of the Code describes the income taxation of annuity payments. Its
provisions apply to payments made under annuity contracts purchased in
conjunction with a Section 403(b) plan, payments made under a retirement plan
meeting the requirements of Section 401(a) or 403(a), and, effective January
1, 1987, payments made under annuity contracts issued as individual retirement
annuities under Section 408(b) of the Code. Other provisions of the Code may
be applicable to payments made under an employer's deferred compensation plan.
It is intended that the provisions of Section 72 will be
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applicable to payments made under Contracts offered by this Prospectus to the
extent they are issued directly to an individual Participant, i.e., the FPA
and IRA Contracts, or in conjunction with a plan described above, i.e., the
TDA and VEC Contracts.
Generally, Participants must receive a payment under a Contract or plan in
order to be subject to income taxation. Interest, earnings or other
accumulations credited to a Participant's accounts are not required to be
included in a Participant's gross income until received by the Participant.
(Such interest, earnings or other accumulations may, in some cases, be subject
to income taxation prior to receipt if the owner of the Contract is not a
natural person or if the applicable requirements of the Code pertaining to
deferral of compensation are not met. See "Obtaining Tax Advice.") Once
annuity payments are received by a Participant, all or part of such payments
will be taxable to such Participant as ordinary income. Special income tax
treatment may be available if a payment constitutes a "lump sum distribution"
made from or under a retirement plan meeting the requirements of Section
401(a) of the Code.
Whether a Participant must include all of the Annuity Payments he has received
in a taxable year in his taxable income depends upon a number of variables. If
a Participant does not have an "investment in the contract," the total amount
received by such Participant during a tax year is includable in his gross
income. If a Participant does have an "investment in the contract," the
portion of the Annuity Payments received which must be included in the
Participant's gross income is determined under the "exclusion ratio" method to
the extent this method is available.
ANNUITY PAYMENTS UNDER AN FPA CONTRACT
A Participant who begins to receive Annuity Payments on or after the Annuity
Commencement Date may apply the "exclusion ratio" method to determine the
percentage of the total of such Payments received during the tax year which is
not subject to income taxation. This percentage is calculated by dividing the
Participant's "investment in the contract" (the total of all of his non-
deductible Contributions) by the "expected return" from the Contract (the
present discounted value of the expected stream of Annuity Payments). The
amount thus excluded from gross income each year represents a partial return
of the Participant's previously non-deductible Contributions.
If the Annuity Commencement Date under the FPA Contract falls on or after
January 1, 1987, the entire amount of the Annuity Payments received by a
Participant each year must be included in gross income once all of the
Participant's investment in the contract," i.e., the sum of the Participant's
non-deductible Contributions, has been recovered under the "exclusion ratio"
method. A Participant whose Annuity Commencement Date was on or before
December 31, 1986 can continue to exclude the applicable percentage of Annuity
Payments, determined as described above, received during each tax year even
though his or her "investment in the contract" has been totally recovered.
WITHDRAWALS UNDER AN FPA CONTRACT
The "exclusion ratio" method is only applicable to amounts received as an
annuity, e.g., Annuity Payments or another form of periodic payments, such as
an installment method for a fixed period or a fixed amount. If a Participant
receives payment under the FPA Contract which are not Annuity Payments (or
otherwise are not amounts received as an annuity), e.g., by making cash
withdrawals prior to the Annuity Commencement Date, the entire amount of such
payments must be included in the Participant's gross income in the tax year in
which received to the extent that the value of the FPA Contract immediately
before the payment exceeds the Participant's "investment in the contract."
This method causes the interest or earnings credited under the FPA Contract to
be taxed to the Participant before his "investment in the contract" may be
recovered. This rule is applicable to FPA Contracts issued on or after August
14, 1982. A different method may be applicable with respect to non-annuity
payments made under FPA Contracts issued before that date (see "Obtaining Tax
Advice").
LUMP SUM DISTRIBUTIONS UNDER AN FPA CONTRACT
A Participant who receives a single lump sum payment in lieu of Annuity
Payments must include the difference between the amount of the lump sum
payment and the amount of his "investment in the contract" in gross income for
the tax year in which the single lump sum payment is received.
ANNUITY PAYMENTS UNDER VEC, TDA AND IRA CONTRACTS
The "exclusion ratio" method is also applicable to Annuity Payments made on or
after the Annuity Commencement date under IRA, TDA and VEC Contracts. Under an
IRA Contract, a Participant's "investment in the contract" is generally equal
to the total of his non-deductible Contributions made since January 1, 1987.
With respect to a VEC Contract, a Participant's "investment in the contract"
is equal to the total of the Participant's non-deductible Contributions which
are made in accordance with the provisions of a retirement plan which meets
the requirements of either Section 401(a) or Section 403(a) of the Code. With
respect to a TDA Contract, a Participant's "investment in the contract" would
generally be represented by the total amount of Contributions made which were
not excludable from a Participant's gross income, i.e., Contributions
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which are in excess of the applicable limitations set forth in Section 403(b)
of the Code. In each case, the "expected return" is equal to the present
discounted value of the expected stream of Annuity Payments. As is the case
with Annuity Payments beginning on or after January 1, 1987 under an FPA
Contract, the "exclusion ratio" method continues to apply until the
"investment in the contract" has been recovered by the Participant. After that
time, the Participant will have to include the full amount of each Annuity
Payment in his income for each taxable year. In addition, if Annuity Payments
from a TDA Contract or a VEC Contract began before July 2, 1986, the "three
year cost recovery" rule may be applicable (see "Obtaining Tax Advice").
WITHDRAWALS UNDER VEC, TDA AND IRA CONTRACTS
Participants who receive payments under an IRA, TDA or VEC Contract on and
after July 2, 1986 which are not "amounts received as an annuity" or which are
received before the Annuity Commencement Date and who have an "investment in
the contract" generally may exclude only a portion of such payments from gross
income. The portion which may be excluded from gross income is generally
determined by dividing the Participant's "investment in the contract" by the
value of his vested account balance (or, in the case of a retirement plan
which is a defined benefit pension plan, the value of the vested accrued
benefit) as of the date of the distribution. The Internal Revenue Service may
indicate another date for valuing account balances for such purposes. It
should be noted that the value of a Participant's account balance on an
applicable valuation date under a VEC Contract issued in conjunction with a
defined benefit pension plan may be used in lieu of the present value of a
Participant's total vested accrued benefit under such plan if the "separate
contract" requirements of Section 72 are met (see "Obtaining Tax Advice"). A
special rule may apply with respect to Participant Contributions made before
January 1, 1987 which constitute part of the "investment in the contract."
Generally, such Contributions may be withdrawn prior to the Annuity
Commencement Date and not be subject to income taxation (earnings are subject
to taxation) if a Participant could have made such a withdrawal under the
terms of the retirement plan on or before May 5, 1986 without separating from
service (see "Obtaining Tax Advice" and "The Group and Individual Annuity
Contracts--Withdrawals").
LUMP SUM PAYMENTS UNDER VEC, TDA AND IRA CONTRACTS
Participants who receive a single sum payment of their entire account balance
under either an IRA, TDA or VEC Contract must include the entire amount of
such payment in their gross income in the tax year in which such payment was
received. However, any "investment in the contract" which has not been
recovered prior to the payment of such lump sum may be excluded from gross
income for such tax year.
QUALIFICATION OF CONTRACTS GENERALLY
The methods of taxation described above are only applicable to payments made
under Contracts issued in conjunction with plans which satisfy the
requirements of the Code.
Qualification of FPA Contracts Under the Code. FPA Contracts are issued on a
non-tax qualified basis and are generally intended for use by Participants for
personal financial planning purposes. FPA Contracts may also be issued in
conjunction with an employer's non-tax qualified deferred compensation plan
(see "Obtaining Tax Advice"). It is intended that the FPA Contracts will meet
the requirements for annuity contracts set forth in Section 72 of the Code,
e.g., the requirements with respect to pre- and post-death distributions.
Qualification of VEC Contracts Under the Code. Generally, VEC Contracts are
issued in conjunction with tax qualified retirement plans which meet the
requirements of Section 401(a) or Section 403(a) of the Code. They are
intended to be used as funding vehicles for the after-tax employee
Contributions which were made under the provisions of such plans and within
the applicable limitations of the federal tax law. (See "Obtaining Tax
Advice.")
Qualification of TDA Contracts Under the Code. The TDA Contract is offered for
use with plans designed to meet the provisions of Section 403(b) of the Code.
Under Section 403(b), Contributions applied toward the purchase of annuity
contracts on behalf of employees of public schools and organizations exempt
from tax under Section 501(c)(3) of the Code are excludable from the gross
income of such employees. However, this exclusion is limited to the extent
that the aggregate Contributions per year for such employees cannot exceed the
"exclusion allowance" set forth in Section 403(b)(2) or, if applicable, the
contribution limitation set forth in Section 415(c) of the Code. If
Contributions are made under a salary reduction agreement an additional
limitation, set forth in Section 402(g) of the Code, is applicable. Generally,
contributions are limited to the least of these applicable limits. In general,
these limitations are as follows:
(1) The total Contribution for a year cannot exceed the excess of 20% of the
employee's includable compensation for that year multiplied by the employee's
years of service minus any amounts contributed by his employer and excludable
from the employee's gross income for any prior taxable years;
(2) The Contributions to the Plan cannot exceed the lesser of $30,000 or 25%
of a Participant's includable compensation;
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(3) Amounts which are contributed through salary reduction are limited to
$9,500 per year. (A special "catch-up," available to employees with 15 or more
years of service with the employer who have not made maximum contributions in
prior years may increase that amount by up to $3,000 per year, to a maximum
"catch-up" of $15,000.)
In addition, under certain circumstances the tax law may allow special
elections which would permit an increased exclusion allowance.
Qualification of IRA Contracts Under the Code. The IRA Contract is designed to
meet the requirements described in Section 408(b) of the Code.
Generally, the maximum allowable deduction which a Participant may take for
Contributions to a Regular IRA or SEP IRA is $2,000 or 100% of his annual
compensation, whichever is less. If a Participant or his spouse participates
in a pension plan, a TDA, a SEP IRA or a SIMPLE IRA, and such Participant has
an adjusted gross income (AGI) over $25,000 ($40,000 for a married couple
filing jointly), he will not be entitled to make the maximum allowable
deductible contribution. His allowable deductible contribution will be reduced
by $1 for every $5 by which his AGI exceeds $25,000 ($40,000 if married and
filing jointly). Thus, such a taxpayer will not be entitled to any IRA
deductions at all once he has an AGI of $35,000 ($50,000 if married and filing
jointly).
A Participant who is not entitled to deduct all or part of his Contributions
to an IRA under the above rules may still make non-deductible contributions of
up to $2,000 or 100% of his annual compensation, whichever is less. As with
deductible contributions, the earnings on the non-deductible contributions
will not be subject to taxation until withdrawn. If a Participant makes a non-
deductible contribution, the Participant must report the amount of that
contribution to the IRS when filing an income tax return for the year.
Participants who make non-deductible contributions to IRAs are responsible for
maintaining their own records regarding such contributions. All contributions
will be presumed by the Insurance Company to be deductible, including for tax
reporting purposes, when distributions occur, and it is the responsibility of
the Participant to make any appropriate adjustments when reporting such
distributions to the IRS on an income tax return for the year of distribution.
The $2,000 limitation is increased to $4,000 if a Participant has a non-
working spouse (or a spouse who elects to be treated as having no
compensation) for whom a Contribution to an IRA is made. Generally, in such a
case, no more than $2,000 may be contributed to an IRA on behalf of either the
Participant or the spouse. Excess Contributions may result in adverse income
tax consequences to a Participant.
A Participant's Contributions to a SIMPLE IRA are excluded from gross income
for Federal income tax purposes.
These limits on Contributions, however, do not apply to tax-free rollovers
from other qualified retirement plans (see "Payment of Contributions").
SIMPLE IRAS--ROLLOVER LIMITATION
During the first two years of participation in a SIMPLE, a Participant may
rollover amounts from a SIMPLE IRA only to another SIMPLE IRA. After the two
year period, a Participant may rollover amounts from a SIMPLE IRA to any IRA.
PENALTY TAXES
TDA, IRA and VEC Contracts
In addition to ordinary income taxation, Section 72 of the Code imposes a
penalty tax on premature withdrawals from TDA, IRA and VEC Contracts. This
penalty tax is equal to 10% of the amount of the premature withdrawal which is
includable in gross income. However, if a Participant makes any withdrawals
from a SIMPLE IRA within the first two years of the Participant's
participation in the employer's SIMPLE, the early withdrawal penalty is
increased to 25% from 10%. In the circumstances described below, no penalty
tax will be imposed. The penalty tax applies to payments made to Participants
under the above Contracts prior to age 59 1/2 unless the distribution is made
under one of the following circumstances:
1. The Participant has died.
2. The Participant has become disabled.
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3. The withdrawals are annuity payments made over the life (or life
expectancy) of the Participant or the joint lives (or joint life
expectancies) of the Participant and his beneficiary.
4. The withdrawals are to pay medical expenses of the Participant, or of
the Participant's spouse or dependents, if the medical expenses would be
deductible by the Participant for federal income tax purposes. (Medical
expenses generally are deductible if they are not covered by health
insurance or otherwise reimbursed and they exceed 7.5% of the taxpayer's
adjusted gross income.)
5. The withdrawals are to pay health insurance premiums for the
Participant, or the Participant's spouse or dependents, if the Policyowner
has received unemployment compensation for at least 12 weeks and certain
other eligibility requirements are met.
Other federal income tax penalties may be applicable to amounts accumulated or
distributed under IRA Contracts (see "Obtaining Tax Advice"). Legislation
pending in Congress may create additional circumstances, such as withdrawals
for higher education expenses, when the penalty tax will not be imposed.
FPA Contracts
Since January 1, 1987, a 10% penalty tax has been imposed on premature
withdrawals made from an FPA Contract which has been issued since January 18,
1985. This penalty tax is applicable to the amount of the premature withdrawal
which is includable in gross income. This penalty tax will be imposed on the
taxable portion of payments made before a Participant attains age 59 1/2
unless the distribution is made under one of the following circumstances:
1. On account of a Participant's death or disability;
2. As part of a series of substantially equal periodic payments made over the
Participant's life (or life expectancy) or over the joint lives (or joint life
expectancies) of a Participant and his beneficiary;
3. From amounts which are attributable to Contributions made prior to August
14, 1982;
4. From a Contract purchased in conjunction with a plan that meets the
requirements of Section 401(a) or was issued under an IRA or TDA;
5. Under an immediate annuity contract; or
6. Under a Contract purchased for an employee by a plan upon its termination,
provided the plan met the requirements of Section 401(a) or Section 403(a) of
the Code.
A 5% penalty tax was applicable to premature payments received before 1987
under FPA Contracts as well as to premature payments received after December
31, 1982 under FPA Contracts issued before January 19, 1985 (see "Obtaining
Tax Advice").
Other federal income tax penalties may be applicable to amounts accumulated or
distributed under VEC, IRA and TDA Contracts (see "Obtaining Tax Advice").
Tax Penalty on Excess Distributions
A Participant who receives aggregate retirement distributions for a calendar
year in excess of a certain amount, currently $160,000, may be subject to a
penalty tax equal to 15% of the excess. This penalty tax is in addition to the
regular income tax imposed on the excess distribution. This penalty does not
generally apply to death benefits and certain other distributions, and special
rules apply to lump sum distributions and certain "grandfathered amounts"
accrued before August 1, 1986. See "Obtaining Tax Advice." This penalty tax
has been temporarily suspended for tax years 1997, 1998 and 1999. However,
there is a corresponding estate tax that has not been suspended.
OTHER MATTERS
Minimum Distributions
The Code contains a series of rules which require that minimum distributions
under IRA, VEC, and TDA Contracts commence by a certain time.
Generally, such rules provide that distributions under a VEC Contract must
begin no later than April 1 of the year following the year in which the
Participant attains age 70 1/2, unless the Participant has not terminated his
employment.
Distributions under IRA Contracts must begin by April 1 of the year following
the year in which the Participant attains age 70 1/2, even if such Participant
does not retire.
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Distributions under TDA Contracts are subject to similar rules. In general,
benefits accruing after December 31, 1986 must be distributed beginning by
April 1 of the year following the year the Participant attains age 70 1/2,
unless the Participant is still employed.
If minimum distribution requirements are not met, a penalty tax equal to 50%
of the difference between the required minimum and the actual distribution may
be applicable (see "Obtaining Tax Advice").
Estate Taxes
In general, a death benefit, consisting of amounts payable to a Participant's
beneficiary (see "Death Benefits") may be includable in the Participant's
estate for federal estate tax purposes. (See "Obtaining Tax Advice.")
WITHHOLDING ON ANNUITY PAYMENTS AND OTHER DISTRIBUTIONS
FPA and IRA Contracts
Federal income tax withholding on Annuity Payments and other distributions
(such as lump sum distributions or premature withdrawals) is required. In
addition, certain states require withholding if federal withholding is
applicable. However, recipients of Annuity Payments or other distributions
under the Contracts are permitted to make an election not to have federal
income tax withheld. Such an election may be revoked by the Participant at any
time. If such election is revoked, withholding will commence.
The withholding rate utilized by the Insurance Company will be applied only
against the taxable portion of the Annuity Payments or of the other
distributions. This rate will be determined based upon the nature of the
distribution(s). Federal tax will be withheld from Annuity Payments pursuant
to the Annuitant's withholding certificate. If no withholding certificate is
filed with the Insurance Company, federal tax will be withheld from Annuity
Payments on the basis that the Annuitant is married with three withholding
exemptions. Federal tax on withdrawals other than Annuity Payments will be
withheld in general at a flat 10% rate of the amount withdrawn. Future IRS
Regulations may also require the withholding of the full 10% penalty tax (see
"Penalty Taxes" above) under some circumstances.
TDA and VEC Contracts
Most withdrawals are subject to automatic 20% federal income tax withholding
unless the participant elects to have the withdrawal paid directly, as a tax-
free rollover, to another eligible plan or an IRA. The same rules generally
apply to payments of death benefits to a surviving spouse beneficiary, or to
payments to a spouse or former spouse in connection with a divorce or
separation decree or court order, except that a surviving spouse may only have
a direct rollover made to an IRA. The required 20% federal tax withholding
cannot be waived if a direct rollover is not elected.
The rules do not apply to all payments. The automatic 20% withholding does not
apply to any distribution that is (a) one of a series of substantially equal
periodic payments (not less frequently than annually) made (1) for the life
(or life expectancy) of the Participant or the joint lives (or joint life
expectancies) of the Participant and the Participant's designated beneficiary,
or (2) for a specified period of 10 years or more, or (b) a minimum
distribution required under Section 401(a)(9) of the Code. In general, tax
withholding at different rates (generally 10%) does apply to such payments but
payees can elect to have withholding waived. Death benefit payments to non-
spouse beneficiaries generally are subject to tax withholding at different
rates, but payees can elect to have withholding waived. Certain small payments
may also be exempt from direct rollover and tax withholding rules.
When withdrawals or benefit payments are to be made, participants (or
beneficiaries) will be given detailed information and advised of their
elections. That information should be carefully reviewed. In addition, certain
states require withholding if federal withholding is applicable.
OBTAINING TAX ADVICE
This description of the current federal tax status of amounts accumulated or
received under the Contracts is not exhaustive and is for information purposes
only. This description does not purport to cover all situations involving the
purchase of an annuity or the election of an option under the Contracts. Tax
results may vary depending upon individual situations and special rules may
apply in certain cases. State and local taxes may also pertain. This
Prospectus does not discuss the requirements and limitations under the Code
applicable to employers in establishing and maintaining SEPs and SIMPLEs or
for the deductibility of employer contributions. For these reasons a qualified
tax adviser should be consulted for complete tax information regarding any
specific situation.
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VOTING RIGHTS
In accordance with the Insurance Company's view of present applicable law and
so long as the Commission continues to interpret the 1940 Act as requiring
pass-through voting privileges, the Insurance Company will vote the shares of
the Investment Company Funds, the Fidelity Portfolios, the Scudder Portfolios,
the American Century VP Capital Appreciation Fund (formerly known as the TCI
Growth Fund) and Calvert Responsibly Invested Balanced Portfolio held in the
Separate Account at regular and special meetings of the shareholders of such
funds or portfolios according to instructions received from persons having the
right to instruct the Insurance Company on how to vote the shares, as defined
below. The Insurance Company will vote shares for which it has not received
instructions in the same proportion as the Insurance Company votes shares for
which the Insurance Company has received instructions, except for shares owned
by the Insurance Company representing "seed" money, which will be voted in the
Insurance Company's discretion. The Insurance Company exercises discretion
with respect to less than 1% of the voting interest in the Separate Account.
If the Investment Company Act of 1940 should be amended, or if the present
interpretation thereof should change, and as a result the Insurance Company
determines that it is permitted to vote the shares of the Investment Company
Funds, the Fidelity Portfolios, the Scudder Portfolios, the American Century
VP Capital Appreciation Fund and Calvert Responsibly Invested Balanced
Portfolio in its own discretion, it may elect to do so.
The person having the right to give voting instructions to the Insurance
Company is the following: under an individual Contract, the person to whom the
Contract is issued and for whom an amount is accumulated in the Separate
Account, and, under a group Contract, the individual for whom amounts are
accumulated in the Separate Account.
Each person having the right to give voting instructions to the Insurance
Company will receive periodic reports relating to any of the Investment
Company Funds, the Fidelity Portfolios, the Scudder Portfolios, the American
Century VP Capital Appreciation Fund and Calvert Responsibly Invested Balanced
Portfolio for which he or she has the right to give voting instructions,
including proxy material and a form with which to give voting instructions.
PERFORMANCE INFORMATION
MONEY MARKET FUND
From time to time, quotations of the "yield" and "effective yield" of the
Separate Account's Money Market Fund may be included in advertisements, sales
literature or shareholder reports. Both yield figures are based on the
historical performance of the Fund and show the performance of a hypothetical
investment and are not intended to indicate future performance. The yield of
the Money Market Fund refers to the net investment income generated by the
Fund over a specified seven-day period (the ending date of which will be
stated). This income is then annualized. That is, the amount of income
generated by the Fund during that week is assumed to be generated during each
week in such a 52-week period and is shown as a percentage. The effective
yield is expressed similarly but, when annualized, the income earned by an
investment in the Fund is assumed to be reinvested. The effective yield will
be slightly higher than the yield because of the compounding effect of this
assumed reinvestment. Yield and effective yield for the Money Market Fund will
vary based on, among other things, changes in the market conditions, the level
of interest rates and the level of the Money Market Fund's portfolio expenses.
OTHER FUNDS
From time to time, quotations of a Fund's "total return" may be included in
advertisements, sales literature or shareholder reports. Total return figures
are based on the historical performances of the Fund and show the performance
of a hypothetical investment and are not intended to indicate future
performance. The total return of a Fund refers to return assuming an
investment has been held in the Fund for one, five and ten years and for the
life of the Fund (the ending date of which will be stated). The total return
quotations are expressed in terms of average annual compounded rates of return
for all periods quoted and assume that all dividends and capital gains
distributions were reinvested. Total return for a Fund will vary based on,
among other things, changes in market conditions and the level of the Fund's
expenses.
For a detailed description of the methods used to determine yield and total
return for the Separate Account's Funds, see the Statement of Additional
Information.
FUNDING AND OTHER CHANGES
The Insurance Company reserves the right, subject to compliance with
applicable law, including approval of Participants if so required, (1) to
create new investment funds of the Separate Account at any time; (2) to
transfer assets determined by the Insurance Company to be associated with the
class of contracts to which the Contracts belong from the Separate Account to
another separate account of the Insurance Company by withdrawing the same
percentage of each investment in the Separate
36
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Account with appropriate adjustments to avoid odd lots and fractions; (3) to
create additional separate investment accounts or combine any two or more
accounts including the Separate Account; (4) to operate the Separate Account
as a diversified, open-end management investment company under the 1940 Act,
or in any other form permitted by law, and to designate an investment adviser
in connection therewith, which may be the Insurance Company, an affiliate of
the Insurance Company or another person; (5) to deregister the Separate
Account under the 1940 Act; and (6) to operate the Separate Account under the
general supervision of a committee any or all the members of which may be
interested persons (as defined in the 1940 Act) of the Insurance Company or an
affiliate, or to discharge the committee of one or more of the Separate
Accounts.
OTHER VARIABLE ANNUITY CONTRACTS
In addition to the Contracts described in this Prospectus, the Insurance
Company offers other individual and group variable annuity contracts, some of
which are not described in this Prospectus but which also participate in the
Separate Account.
TABLE OF CONTENTS OF THE STATEMENT OF ADDITIONAL INFORMATION
Distribution of the Contracts
Money Market Yield Calculation
Performance Information
Safekeeping of Separate Account Assets
State Regulation
Periodic Reports
Legal Proceedings
Legal Matters
Experts
Additional Information
Financial Statements
OBTAINING A COPY OF THE STATEMENT OF ADDITIONAL INFORMATION
To receive a copy of the Statement of Additional Information at no charge, the
Participant may as an alternative to calling (212) 224-1600, detach the Form
included below and mail it to Mutual of America Life Insurance Company, 320
Park Avenue, New York, New York 10022.
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ORDER FORM FOR STATEMENT OF ADDITIONAL INFORMATION
To: Mutual of America Life Insurance Company
Please send me a copy of the Statement of Additional Information dated May 1,
1997 for the Tax-Deferred Annuity Plan, Voluntary Employee Contribution
Program, Individual Retirement Annuity and Flexible Premium Annuity offered by
Mutual of America. My name and address are as follows:
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Name
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Street Address
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City State Zip
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