<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JANUARY 12, 1999
REGISTRATION NOS. 2-90380/811-4001
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM N-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]
PRE-EFFECTIVE AMENDMENT NO. [ ]
[X]
POST-EFFECTIVE AMENDMENT NO. 24
AND/OR
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]
[X]
AMENDMENT NO. 23
------------------------
METROPOLITAN LIFE SEPARATE ACCOUNT E
(EXACT NAME OF REGISTRANT)
METROPOLITAN LIFE INSURANCE COMPANY
(EXACT NAME OF DEPOSITOR)
1 MADISON AVENUE, NEW YORK, NEW YORK 10010
(ADDRESS OF DEPOSITOR'S PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
(212) 578-5364
(DEPOSITOR'S TELEPHONE NUMBER, INCLUDING AREA CODE)
------------------------
GARY A. BELLER, ESQ.
SENIOR EXECUTIVE VICE-PRESIDENT AND GENERAL COUNSEL
METROPOLITAN LIFE INSURANCE COMPANY
1 MADISON AVENUE
NEW YORK, NEW YORK 10010
(NAME AND ADDRESS OF AGENT FOR SERVICE)
------------------------
Copies to:
JOHN A. DUDLEY, ESQ.
SULLIVAN & WORCESTER LLP
1025 CONNECTICUT AVENUE, N.W.
WASHINGTON, D.C. 20036
------------------------
IT IS PROPOSED THAT THE FILING WILL BECOME EFFECTIVE:
[ ] immediately upon filing pursuant to paragraph (b) of Rule 485
[ ] on (date) pursuant to paragraph (b) of Rule 485
[ ] 60 days after filing pursuant to paragraph (a)(1) of Rule 485
[X] on April 30, 1999 pursuant to paragraph (a)(1) of Rule 485
[ ] on the seventy-fifth day after filing pursuant to paragraph (a)(2) of
Rule 485
[ ] on (date) pursuant to paragraph (a)(2) of Rule 485
PURSUANT TO RULE 24f-2 UNDER THE INVESTMENT COMPANY ACT OF 1940, THE
REGISTRANT HAS REGISTERED AN INDEFINITE AMOUNT OF SECURITIES. REGISTRANT'S RULE
24f-2 NOTICE FOR THE YEAR ENDED DECEMBER 31, 1998 WILL BE FILED WITH THE
COMMISSION ON OR ABOUT MARCH 27, 1999.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
METROPOLITAN LIFE SEPARATE ACCOUNT E
FORM N-4
UNDER
THE SECURITIES ACT OF 1933 AND THE INVESTMENT COMPANY ACT OF 1940
CROSS REFERENCE SHEET
(PURSUANT TO RULE 481(A))
<TABLE>
<CAPTION>
FORM N-4
ITEM NO. PROSPECTUS HEADING
- -------- ------------------------------
<S> <C> <C>
1. Cover Page............................. Cover Page
2. Definitions............................ Important Terms You Should
Know
3. Synopsis............................... Table of Expenses
4. Condensed Financial Information........ Accumulation Unit Values
Table; General
Information--Advertising
Performance; General
Information--Financial
Statements
5. General Description of Registrant,
Depositor, and Portfolio Companies... MetLife; Metropolitan Life
Separate Account E; Your
Investment Choices; General
Information--Voting Rights
6. Deductions and Expenses................ Table of Expenses; Deferred
Annuities--Charges; Deferred
Annuities--Early Withdrawal
Charges; Deferred
Annuities--Annuity Taxes;
Income Annuities--Charges;
Income Annuities--Annuity
Taxes; General Information--
Who Sells the Deferred
Annuities and Income
Annuities; Appendix--Annuity
Tax Table
7. General Description of Variable Annuity
Deferred Annutiy..................... The Variable Annuities in this
Prospectus; Deferred
Annuities--Purchase Payments
(Allocation of Purchase
Payments and Limits on
Purchase Payments); Deferred
Annuities--Transfers; Income
Annuities--Purchasing an
Income Annuity; Income
Annuity--Allocation of Your
Purchase Payments; Income
Annuity--Transfers; General
Information--Administration
(Purchase Payments/
Confirming Transactions/
Transactions by Telephone/
Processing Certain
Transactions/Changes to Your
Deferred Annuity or Income
Annuity/When We Can Cancel
Your Deferred Annuity or
Income Annuity)
8. Annuity Period......................... Important Terms You Should
Know; Deferred Annuities--
Pay-out Options (or Income
Options); Income Annuities--
Income Payment Types/The
Value of Your Income
Payments
</TABLE>
1
<PAGE>
<TABLE>
<CAPTION>
FORM N-4
ITEM NO. PROSPECTUS HEADING
- -------- ------------------------------
<S> <C> <C>
9. Death Benefit.......................... Deferred Annuities--Death
Benefit
10. Purchases and Deferred Annuity
Values............................... MetLife; Metropolitan Life
Separate Account E; Deferred
Annuities--Purchase Payments
(Allocation of Purchase
Payments and Limits on
Purchase Payments)/The Value
of Your Investment; Income
Annuities--Purchasing an
Income Annuity/Allocation of
Your Purchase Payment/The
Value of Your Income
Payments; General
Information--Administration
(Purchase Payments)
11. Redemptions............................ Deferred Annuities--Access to
Your Money (Systematic
Withdrawal Program for
Deferred Annuities and
Minimum Distribution);
Deferred Annuities--Early
Withdrawal Charges (when no
early Withdrawal Charge
Applies and When another
Early Withdrawal Charge May
Apply); General
Information--When We Can
Cancel Your Deferred Annuity
or Income Annuity Appendix
II for Texas Optional
Retirement Program
12. Taxes.................................. Income Taxes
13. Legal Proceedings...................... Not Applicable
14. Table of Contents of the Statement of
Additional Information............... Table of Contents of the
Statement of Additional
Information
15. Cover Page............................. Cover Page
16. Table of Contents...................... Table of Contents
17. General Information and History........ Not Applicable
18. Services............................... Independent Auditors;
Services; Year 2000;
Distribution of Certificates
and Interests in the
Deferred Annuities and
Income Annuities
19. Purchase of Securities Being Offered... Not Applicable
20. Underwriters........................... Distribution of Certificates
and Interests in the
Deferred Annuities and
Income Annuities; Early
Withdrawal Charge
21. Calculation of Performance Data........ Performance Data
22. Annuity Payments....................... Variable Income Payments
23. Financial Statements................... Financial Statements of the
Separate Account; Financial
Statements of MetLife
</TABLE>
2
<PAGE>
April 30, 1999
Preference Plus(Registered) Account Variable Annuity Contracts
Issued by Metropolitan Life Insurance Company
This Prospectus describes individual and group Preference Plus contracts for
deferred variable annuities ("Deferred Annuities") and Preference Plus immediate
variable income annuities ("Income Annuities").
You decide how to allocate your money among the various available investment
choices. The investment choices available to you are listed in the contract for
your Deferred Annuity or Income Annuity. Your choices may include the Fixed
Interest Account (not described in this Prospectus) and investment divisions
available through Metropolitan Life Separate Account E which, in turn, invest in
the following corresponding portfolios of the Metropolitan Series Fund, Inc.
("Metropolitan Fund"):
State Street Research Aggressive Growth
State Street Research Diversified
State Street Research Growth
State Street Research Income
Harris Oakmark Large Cap Value
Janus Mid Cap
Loomis Sayles High Yield Bond
Neuberger&Berman Partners Mid Cap Value
Santander International Stock
Scudder Global Equity
T. Rowe Price Large Cap Growth
T. Rowe Price Small Cap Growth
Lehman Brothers Aggregate Bond Index
MetLife Stock Index
Morgan Stanley EAFE(Registered) Index
Russell 2000(Registered) Index
How to learn more:
Before investing, read the information in this Prospectus about the Deferred
Annuities, Income Annuities and Metropolitan Life Separate Account E. Keep this
Prospectus for future reference. For more information, request a copy of the
Statement of Additional Information ("SAI"), dated April 30, 1999. The SAI is
considered part of this Prospectus as though it were included in the Prospectus.
The Table of Contents of the SAI appears on page A-PPA-46 of this Prospectus. To
request a free copy of the SAI or to ask questions, write or call:
Metropolitan Life Insurance Company
Retirement & Savings Center, Area 2H
One Madison Avenue
New York, NY 10010-3690
Attention: Alan DeMichele
Phone: (800) 553-4459
The Securities and Exchange Commission has a website (http://www.sec.gov) which
you may visit to view this Prospectus, SAI and other information. The Securities
and Exchange Commission has not approved or disapproved these securities or
determined if this Prospectus is truthful or complete. Any representation
otherwise is a criminal offense.
The current Metropolitan Fund Prospectus is attached to the back of this
Prospectus. You should also read the Metropolitan Fund Prospectus carefully
before purchasing a Deferred Annuity or Income Annuity. This Prospectus is not
valid unless attached to a Metropolitan Fund Prospectus.
Deferred Annuities
Available for Purchase:
o Non-Qualified
o Traditional IRA
o Roth IRA
o SIMPLE IRA
o SEP IRA
Income Annuities Available:
o Non-Qualified
o Traditional IRA
o Roth IRA
o SIMPLE IRA
o SEP IRA
A word about investment risk:
An investment in any of these variable annuities involves investment risk. You
could lose money you invest. Money invested is NOT:
o a bank deposit or obligation;
o federally insured or guaranteed; or
o endorsed by any bank or other financial institution.
[LOGO OF METROPOLITAN LIFE INSURANCE COMPANY]
<PAGE>
TABLE OF CONTENTS
Important Terms You Should Know ................................. A-PPA-4
Table of Expenses ............................................... A-PPA-6
Accumulation Unit Values Table .................................. A-PPA-9
MetLife ......................................................... A-PPA-13
Metropolitan Life Separate Account E ............................ A-PPA-13
The Variable Annuities in this Prospectus ....................... A-PPA-14
A Deferred Annuity ......................................... A-PPA-14
An Income Annuity .......................................... A-PPA-14
Your Investment Choices ......................................... A-PPA-15
Deferred Annuities .............................................. A-PPA-16
The Deferred Annuity and Your Retirement Plan .............. A-PPA-16
Automated Investment Strategies ............................ A-PPA-17
Purchase Payments .......................................... A-PPA-18
Allocation of Purchase Payments ............................ A-PPA-18
Automated Purchase Payments ................................ A-PPA-18
Electronic Applications .................................... A-PPA-18
Limits on Purchase Payments ................................ A-PPA-19
The Value of Your Investment ............................... A-PPA-19
Transfers .................................................. A-PPA-20
Access to Your Money ....................................... A-PPA-21
Systematic Withdrawal Program .............................. A-PPA-21
Minimum Distribution ....................................... A-PPA-22
Contract Fee ............................................... A-PPA-22
Charges .................................................... A-PPA-23
Insurance-Related Charge ................................... A-PPA-23
Investment-Related Charge .................................. A-PPA-23
Annuity Taxes .............................................. A-PPA-24
Early Withdrawal Charges ................................... A-PPA-24
When No Early Withdrawal Charge Applies .................. A-PPA-25
When Another Early Withdrawal Charge May Apply ........... A-PPA-26
Free Look .................................................. A-PPA-27
Death Benefit .............................................. A-PPA-27
Pay-out Options (or Income Options) ........................ A-PPA-27
A-PPA-2
<PAGE>
Income Annuities ................................................... A-PPA-28
Income Payment Types .......................................... A-PPA-29
Purchasing an Income Annuity .................................. A-PPA-30
Allocation of Your Purchase Payment ........................... A-PPA-30
The Value of Your Income Payments ............................. A-PPA-30
Transfers ..................................................... A-PPA-31
Contract Fee .................................................. A-PPA-31
Charges ....................................................... A-PPA-31
Insurance-Related Charge ...................................... A-PPA-32
Investment-Related Charge ..................................... A-PPA-32
Annuity Taxes ................................................. A-PPA-32
Free Look ..................................................... A-PPA-32
General Information ................................................ A-PPA-33
Administration ................................................ A-PPA-33
Purchase Payments ............................................. A-PPA-33
Confirming Transactions ....................................... A-PPA-33
Transactions by Telephone ..................................... A-PPA-34
Processing of Certain Transactions ............................ A-PPA-34
Valuation ..................................................... A-PPA-34
Advertising Performance ....................................... A-PPA-35
Changes to Your Deferred Annuity or Income Annuity ............ A-PPA-36
Voting Rights ................................................. A-PPA-36
Who Sells the Deferred Annuities and Income Annuities ......... A-PPA-37
Financial Statements .......................................... A-PPA-38
When We Can Cancel Your Deferred Annuity or Income Annuity .... A-PPA-38
Income Taxes ....................................................... A-PPA-38
Table of Contents of the Statement of Additional Information ....... A-PPA-46
Appendix for Annuity Tax Table ..................................... A-PPA-47
MetLife does not intend to offer the Deferred Annuities or Income Annuities
anywhere they may not lawfully be offered and sold. MetLife has not authorized
any information or representations about the Deferred Annuities or Income
Annuities other than the information in this Prospectus, the attached
prospectus, supplements to the prospectuses or any supplemental sales material
we authorize.
A-PPA-3
<PAGE>
Important Terms You Should Know
Account Balance
When you purchase a Deferred Annuity an account is set up for you. Your Account
Balance is the total amount of money credited to you under your Deferred Annuity
including money in the investment divisions of the Separate Account and the
Fixed Income Account.
Accumulation Unit Value
Under a Deferred Annuity, money paid-in or transferred into an investment
division of the Separate Account is credited to you in the form of accumulation
units. Accumulation units are established for each investment division. We
determine the value of these accumulation units each day the New York Stock
Exchange is open for regular trading. The values increase or decrease based on
the investment performance of the corresponding underlying portfolios.
Annuity Unit Value
Under an Income Annuity or variable payout option, the money paid-in or
transferred into an investment division of the Separate Account is held in the
form of annuity units. Annuity units are established for each investment
division. We determine the value of these annuity units each day the New York
Stock Exchange is open for regular trading. The values increase or decrease
based on the investment performance of the corresponding underlying portfolios.
Assumed Investment Return (AIR)
Under an income annuity, the AIR is a percentage rate of return assumed to
determine the amount of the first variable income payment. The AIR is also the
benchmark that is used to calculate the investment performance of a given
investment division to determine all subsequent payments to you.
Contract
A contract is the legal agreement between you and MetLife or the certificate
under a group annuity contract between MetLife and your employer, plan trustee
or other entity. The contract contains relevant provisions of your Deferred
Annuity or Income Annuity. MetLife issues contracts for each of the annuities
described in this Prospectus.
Contract Year
Generally, the Contract Year for a Deferred Annuity is the period ending on the
last day of the month in which the anniversary of when we issue the annuity
occurs and each following 12 month period.
A-PPA-4
<PAGE>
Early Withdrawal Charge
The early withdrawal charge is the amount we deduct from your Account Balance in
addition to your requested withdrawal amount, if you withdraw money prematurely
from a Deferred Annuity. This charge is often referred to as a deferred sales
load or back-end load.
Investment Division
Investment divisions are subdivisions of the Separate Account. When you allocate
or transfer money to an investment division, the investment division purchases
shares of a portfolio (with the same name) within the Metropolitan Fund.
MetLife
Metropolitan Life Insurance Company is the company that issues the Deferred
Annuities and Income Annuities. Throughout this Prospectus, MetLife is also
referred to as "we," "us" or "our."
MetLife Designated Office
Your MetLife Designated Office is the MetLife office that will generally handle
the processing of all your requests concerning your Deferred Annuity or Income
Annuity. MetLife will notify you and provide you with the address of your
MetLife Designated Office.
Separate Account
A separate account is an investment account. All assets contributed to
investment divisions under the Deferred Annuities and Income Annuities are
pooled in the Separate Account and maintained for the benefit of investors in
Deferred Annuities and Income Annuities.
You
In this Prospectus, depending on the context, "you" may mean either the
purchaser of the Deferred Annuity or Income Annuity, the annuitant under an
Income Annuity, or the participant or annuitant under certain group
arrangements.
Variable Annuity
An annuity in which returns/income payments are based upon the performance of
investments such as stocks and bonds held by one or more underlying portfolios.
You assume the investment risk for any amounts allocated to the investment
divisions in a variable annuity.
A-PPA-5
<PAGE>
TABLE OF EXPENSES--PREFERENCE PLUS DEFERRED ANNUITIES AND INCOME ANNUITIES
The following table shows the Separate Account and Metropolitan Fund charges and
expenses you will incur. The table is based on past experience and is subject to
change. It is not intended to show your actual expenses which may be higher or
lower. The table does not show fees for the Fixed Interest Account or the impact
of annuity taxes. We have provided examples to show you the impact of Separate
Account and Metropolitan Fund charges and expenses on a hypothetical investment
of $1,000 that has an assumed 5% return on the investment.
- --------------------------------------------------------------------------------
Separate Account and Metropolitan Fund expenses for the fiscal year ending
December 31, 1998:
Contractowner Transaction Expenses For All Investment Divisions Currently
Offered
Sales Load Imposed on Purchases .........................................None
Deferred Sales Load (as a percentage
of the purchase payment funding the withdrawal during the accumulation
period)(1) .....................................................From 0% to 7%
Exchange Fee ................................................... None
Surrender Fee .................................................. None
Annual Contract Fee (2) ........................................... None
Separate Account Annual Expenses (as a percentage of
average account value) (3)
General Administrative Expenses Charge ......................... .50%
Mortality and Expense Risk Charge .............................. .75%
Total Separate Account Annual Expenses ......................... 1.25%
OTHER EXPENSES
Metropolitan Fund Annual Expenses MANAGEMENT AFTER EXPENSE
(as a percentage of average net assets) FEES REIMBURSEMENT TOTAL
- -------------------------------------------------------------------------------
State Street Research Aggressive Growth
Portfolio (4)(5).........................
State Street Research Diversified
Portfolio (4)(5).........................
State Street Research Growth
Portfolio (4)(5).........................
State Street Research Income
Portfolio (4)(5).........................
Harris Oakmark Large Cap Value
Portfolio (5)(7).........................
Janus Mid Cap Portfolio (5)(6)............
Loomis Sayles High Yield Bond
Portfolio (6)............................
Neuberger&Berman Partners Mid Cap
Value Portfolio (5)(7)...................
Santander International Stock
Portfolio (4)(5).........................
Scudder Global Equity
Portfolio (5)(6).........................
T. Rowe Price Large Cap Growth
Portfolio (5)(7).........................
T. Rowe Price Small Cap Growth
Portfolio (5)(6).........................
Lehman Brothers Aggregate Bond Index
Portfolio (7)............................
MetLife Stock Index Portfolio (4).........
Morgan Stanley EAFE(Registered)
Index Portfolio (7)......................
Russell 2000 Index Portfolio (7)..........
A-PPA-6
<PAGE>
Example
If you surrender your Deferred Annuity (withdraw all your money) at the end of
the time periods listed below, you would pay the following expenses on a $1,000
investment in each investment division listed below, assuming a 5% annual return
on assets:
<TABLE>
<CAPTION>
1 3 5 10
YEAR YEARS YEARS YEARS
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
State Street Research Aggressive Growth Portfolio........
State Street Research Diversified Portfolio..............
State Street Research Growth Portfolio...................
State Street Research Income Portfolio...................
Harris Oakmark Large Cap Value Portfolio.................
Janus Mid Cap Portfolio..................................
Loomis Sayles High Yield Bond Portfolio..................
Neuberger&Berman Partners Mid Cap Value Portfolio........
Santander International Stock Portfolio..................
Scudder Global Equity Portfolio..........................
T. Rowe Price Large Cap Growth Portfolio.................
T. Rowe Price Small Cap Growth Portfolio.................
Lehman Brothers Aggregate Bond Index Portfolio...........
MetLife Stock Index Portfolio............................
Morgan Stanley EAFE(Registered) Index Portfolio..........
Russell 2000 Index Portfolio.............................
</TABLE>
- --------------------------------------------------------------------------------
If you annuitize (elect a pay-out option under your Deferred Annuity) or do not
surrender your Deferred Annuity at the end of the time periods listed below, you
would pay the following expenses on a $1,000 investment in each investment
division listed below, assuming a 5% annual return on assets (8):
<TABLE>
<CAPTION>
1 3 5 10
YEAR YEARS YEARS YEARS
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
State Street Research Aggressive Growth Portfolio........
State Street Research Diversified Portfolio..............
State Street Research Growth Portfolio...................
State Street Research Income Portfolio...................
Harris Oakmark Large Cap Value Portfolio.................
Janus Mid Cap Portfolio..................................
Loomis Sayles High Yield Bond Portfolio..................
Neuberger&Berman Partners Mid Cap Value Portfolio........
Santander International Stock Portfolio..................
Scudder Global Equity Portfolio..........................
T. Rowe Price Large Cap Growth Portfolio.................
T. Rowe Price Small Cap Growth Portfolio.................
Lehman Brothers Aggregate Bond Index Portfolio...........
MetLife Stock Index Portfolio............................
Morgan Stanley EAFE(Registered) Index Portfolio..........
Russell 2000 Index Portfolio.............................
</TABLE>
A-PPA-7
<PAGE>
TABLE OF EXPENSES (continued)
(1) There are times when the early withdrawal charge does not apply to amounts
hat are withdrawn from a Deferred Annuity. Each Contract Year you may take
he greater of 10% of your Account Balance or your purchase payments made
over 7 years ago free of early withdrawal charges.
(2) A $20 annual contract fee is imposed on money in the Fixed Interest
Account. This fee may be waived under certain circumstances. There is a
one time contract fee of $350 for Income Annuities. We do not charge this
fee if you elect a pay-out option under your Deferred Annuity and you have
owned your Deferred Annuity more than two years.
(3) Our total Separate Account Annual Expenses will not exceed 1.25% of your
average balance in the investment divisions. For purposes of presentation
here, we estimated the allocation between general administrative expenses
and the mortality and expense risk charge.
(4) Prior to May 16, 1993, we paid all expenses of the Metropolitan Fund
(other than management fees, brokerage commissions, taxes, interest and
extraordinary or non-recurring expenses).
(5) We anticipate that the marginal rate of the investment management fee for
the Portfolio will decrease when the size of the Portfolio reaches certain
pre-established dollar levels.
(6) These Portfolios began operations on March 3, 1997. We paid all expenses
(other than management fees, brokerage commissions, taxes, interest and
extraordinary or non-recurring expenses) in excess of .20% of the average
net assets for each of the following Portfolios until the Portfolio's
total assets reached $100 million, or until March 2, 1999, whichever came
first:
OTHER EXPENSES DATE
WITHOUT REIMBURSEMENT
REIMBURSEMENT STOPPED
- --------------------------------------------------------------------------------
Loomis Sayles High Yield Bond
T. Rowe Price Small Cap Growth January 23, 1998
Janus Mid Cap December 31, 1997
Scudder Global Equity July 1, 1998
If we had not reimbursed the Portfolios for these expenses, the "other
expenses" for the Portfolios would have been those listed above.
(7) These Portfolios began operations on November 9, 1998. We pay all expenses
(other than management fees, brokerage commissions, taxes, interest and
extraordinary or non-recurring expenses) in excess of .20% (.25% for the
Morgan Stanley EAFE(Registered) Index Portfolio) of the average net assets
for each of the following Portfolios until the Portfolio's total assets
reach $100 million, or until November 8, 2000, whichever comes first:
OTHER EXPENSES
WITHOUT
REIMBURSEMENT
- --------------------------------------------------------------------------------
Harris Oakmark Large Cap Value
Lehman Brothers Aggregate Bond Index
Neuberger&Berman Partners Mid Cap Value
Russell 2000 Index
T. Rowe Price Large Cap Growth Portfolio
Morgan Stanley EAFE(Registered) Index
If we had not reimbursed the Portfolios for these expenses, the "other
expenses" for the Portfolios would have been those listed above.
(8) The income option you choose when you decide to exercise a pay-out option
under your Deferred Annuity must be a life annuity or have scheduled
payments for a period of at least five years to avoid the early withdrawal
charge.
In 1998, the Separate Account annual expenses we received for all Separate
Account annuities was $______.
A-PPA-8
<PAGE>
ACCUMULATION UNIT VALUES FOR EACH INVESTMENT DIVISION
(For an accumulation unit outstanding throughout the period)
These tables and bar charts show fluctuations in the Accumulation Unit Values
for each investment division from year end to year end. The information in this
table has been derived from the Separate Account's full financial statements or
other reports (such as the annual report). The financial statements are audited
annually by Deloitte & Touche LLP, who are independent auditors. The full
financial statements and related notes appear in the SAI.
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------------
NUMBER OF
BEGINNING OF YEAR END OF YEAR ACCUMULATION
ACCUMULATION ACCUMULATION UNITS END OF YEAR
PREFERENCE PLUS DEFERRED ANNUITIES YEAR UNIT VALUE UNIT VALUE (IN THOUSANDS)
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
State Street Research Aggressive Growth Division............. 1998 $25.05
[YEAR END ACCUMULATION UNIT VALUE 1997 23.77 25.05 43,359
BAR CHARTS OMITTED FOR THIS DIVISION 1996 22.35 23.77 43,962
AND EACH OF THE 10 FOLLOWING DIVISIONS] 1995 17.47 22.35 33,899
1994 18.03 17.47 26,890
1993 14.89 18.03 17,094
1992 13.66 14.89 5,747
1991 8.31 13.66 1,060
1990 10.00(a) 8.31 49
Year End Accumulation Unit Value
State Street Research Diversified Division................... 1998 22.89
1997 19.22 22.89 62,604
1996 17.00 19.22 52,053
1995 13.55 17.00 42,712
1994 14.15 13.55 40,962
1993 12.70 14.15 31,808
1992 11.75 12.70 7,375
1991 9.52 11.75 1,080
1990 10.00(a) 9.52 44
Year End Accumulation Unit Value
</TABLE>
A-PPA-9
<PAGE>
ACCUMULATION UNIT VALUES (continued)
(For an accumulation unit outstanding throughout the period)
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------------
NUMBER OF
BEGINNING OF YEAR END OF YEAR ACCUMULATION
ACCUMULATION ACCUMULATION UNITS END OF YEAR
PREFERENCE PLUS DEFERRED ANNUITIES YEAR UNIT VALUE UNIT VALUE (IN THOUSANDS)
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
State Street Research Growth Division....................... 1998 $27.10
1997 21.37 27.10 60,102
1996 17.71 21.37 49,644
1995 13.47 17.71 38,047
1994 14.10 13.47 32,563
1993 12.48 14.10 24,608
1992 11.32 12.48 9,432
1991 8.61 11.32 2,824
1990 10.00(a) 8.61 178
Year End Accumulation Unit Value
State Street Research Income Division....................... 1998 17.89
1997 16.49 17.89 16,307
1996 16.12 16.49 16,604
1995 13.65 16.12 15,252
1994 14.27 13.65 13,923
1993 12.98 14.27 14,631
1992 12.29 12.98 5,918
1991 10.60 12.29 1,210
1990 10.00(a) 10.60 32
Year End Accumulation Unit Value
Janus Mid Cap Division..................................... 1998 12.69
1997 10.00(b) 12.69 7,417
Loomis Sayles High Yield Bond Division..................... 1998 10.51
1997 10.00(b) 10.51 2,375
Year End Accumulation Unit Value
</TABLE>
A-PPA-10
<PAGE>
ACCUMULATION UNIT VALUES (continued)
(For an accumulation unit outstanding throughout the period)
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------------
NUMBER OF
BEGINNING OF YEAR END OF YEAR ACCUMULATION
ACCUMULATION ACCUMULATION UNITS END OF YEAR
PREFERENCE PLUS DEFERRED ANNUITIES YEAR UNIT VALUE UNIT VALUE (IN THOUSANDS)
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Santander International Stock Division...................... 1998 $13.28
1997 13.77 13.28 15,865
1996 14.19 13.77 17,780
1995 14.25 14.19 17,553
1994 13.74 14.25 16,674
1993 9.41 13.74 6,921
1992 10.61 9.41 966
1991 10.00(c) 10.61 92
Year End Accumulation Unit Value
Scudder Global Equity Division.............................. 1998 10.85
1997 10.00(b) 10.85 4,826
Year End Accumulation Unit Value
T. Rowe Price Small Cap Growth Division..................... 1998 11.76
1997 10.00(b) 11.76 6,932
Year End Accumulation Unit Value
MetLife Stock Index Division................................ 1998 29.28
1997 22.43 29.28 58,817
1996 18.52 22.43 43,141
1995 13.70 18.52 29,883
1994 13.71 13.70 23,458
1993 12.67 13.71 18,202
1992 11.94 12.67 8,150
1991 9.32 11.94 1,666
1990 10.00(a) 9.32 55
Year End Accumulation Unit Value
</TABLE>
A-PPA-11
<PAGE>
ACCUMULATION UNIT VALUES (continued)
(For an accumulation unit outstanding throughout the period)
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------------
NUMBER OF
BEGINNING OF YEAR END OF YEAR ACCUMULATION
ACCUMULATION ACCUMULATION UNITS END OF YEAR
PREFERENCE PLUS DEFERRED ANNUITIES YEAR UNIT VALUE UNIT VALUE (IN THOUSANDS)
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Harris Oakmark Large Cap Value Division ........................ 1998 $10.00(d)
Lehman Brothers Aggregate Bond Division ........................ 1998 10.00(d)
Morgan Stanley EAFE(Registered) Index Division ................. 1998 10.00(d)
Neuberger&Berman Partners Mid Cap Value Division ............... 1998 10.00(d)
Russell 2000 Index Division .................................... 1998 10.00(d)
T. Rowe Price Large Cap Growth Division ........................ 1998 10.00(d)
</TABLE>
- ----------
In addition to the above mentioned Accumulation Units, there were cash reserves
of $ as of December 31, 1998, applicable to Income Annuities (including those
not described in this Prospectus) receiving annuity payouts.
(a) Inception Date July 2, 1990.
(b) Inception Date March 3, 1997.
(c) Inception Date July 1, 1991.
(d) Inception Date November 9, 1998. A bar chart does not appear for this
Division because there is less than one calendar year of performance history.
A-PPA-12
<PAGE>
MetLife
Our main office is located at One Madison Avenue, New York, New York 10010.
Headquartered in New York City since 1868, MetLife is one of the world's largest
financial services companies and a leader in life insurance sales in the United
States. With approximately $-- billion worth of assets under management as of
December 31, 1998, MetLife serves 37 million people around the world and manages
pension plans for many Fortune 500 companies. The more than 41,000 associates in
the MetLife family provide or administer life, health and property/casualty
insurance, annuities, mutual funds as well as other kinds of saving, retirement
and financial products and services for individuals and groups.
We are a mutual life insurance company. In November 1998, MetLife announced its
intention to convert to a stock company from a mutual company. MetLife's board
of directors authorized the development of a plan to "demutualize." The plan
will be subject to approval by the board of directors, the State of New York
Insurance Department and policyholders. As of April 30, 1999, we do not know the
details of the plan or when or if it will take effect.
Metropolitan Life Separate Account E
We established Metropolitan Life Separate Account E on September 27, 1983. The
purpose of the Separate Account is to hold the variable assets that underlie the
Preference Plus Account Variable Annuity Contracts and some other variable
annuity contracts we issue. We have registered the Separate Account with the
Securities and Exchange Commission as a unit investment trust under the
Investment Company Act of 1940.
The Separate Account's assets are solely for the benefit of those who invest in
the Separate Account and no one else, including our creditors. We are obligated
to pay all money we owe under the Deferred Annuities and Income Annuities even
if that amount exceeds the assets in the Separate Account. The assets of the
Separate Account are held in our name on behalf of the Separate Account and
legally belong to us. All the income, gains, and losses (realized or unrealized)
resulting from these assets are credited to or charged against the contracts
issued from this Separate Account without regard to our other business.
A-PPA-13
<PAGE>
The Variable Annuities in this Prospectus
There are two types of variable annuities described in this Prospectus: Deferred
Annuities and Income Annuities. These annuities are "variable" because the value
of your account or income payment varies based on the investment performance of
the investment divisions you choose. In short, the value of your Deferred
Annuity, your income payments under a variable pay-out option of your Deferred
Annuity, or your income payments under your Income Annuity, may go up or down.
Since the investment performance is not guaranteed, your money is at risk. The
degree of risk will depend on the investment divisions you select. The
Accumulation Unit Value or Annuity Unit Value for each investment division rises
or falls based on the investment performance (or "experience") of the Portfolio
with the same name.
The Deferred Annuities have a fixed interest rate option called the Fixed
Interest Account. With the Fixed Interest Account, your money earns a rate of
interest that we guarantee. Income Annuities and the variable pay-out options
under the Deferred Annuities have a fixed payment option called the Fixed Income
Option. Under the Fixed Income Option, we guarantee the amount of your fixed
income payments. These fixed options are not described in this Prospectus
although we occasionally refer to them.
_______________________________________________________________________________
Group Deferred Annuities and group Income Annuities are also available. They are
offered to an employer, association, trust or other group for its employees,
members or participants.
________________________________________________________________________________
A Deferred Annuity
You accumulate money in your account during the pay-in phase by making one or
more purchase payments. MetLife will hold your money and credit investment
returns as long as the money remains in your account.
________________________________________________________________________________
A Deferred Annuity consists of two phases: the accumulation or "pay-in" phase
and the income annuity or "pay-out" phase.
________________________________________________________________________________
The pay-out phase begins when you either take all of your money out of the
account or elect to have us pay you "income" payments using the money in your
account. The number and the amount of the income payments you receive will
depend on such things as the type of pay-out option you choose, your investment
choices, and the amount used to provide your income payments. Because Deferred
Annuities offer various insurance benefits such as payment options, including
our guarantee of income for your lifetime, they are "annuities."
An Income Annuity
An Income Annuity, also known as an immediate annuity, only has a "pay-out"
phase. You make a single purchase payment and select the type of pay-out option
suited to your needs. Some of the pay-out options guarantee an income stream for
your lifetime or your and another's lifetimes. Some Income Annuities guarantee a
time period of your choice over which MetLife will make income payments. Income
Annuities also have other features. The amount of your income payments you
receive will depend on such things as the type of pay-out option you choose,
your investment choices and the amount of your purchase payment.
A-PPA-14
<PAGE>
Your Investment Choices
The investment choices are:
Lehman Brothers Aggregate Bond Index Portfolio
State Street Research Income Portfolio
State Street Research Diversified Portfolio
MetLife Stock Index Portfolio
Harris Oakmark Large Cap Value Portfolio
T. Rowe Price Large Cap Growth Portfolio
State Street Research Growth Portfolio
Neuberger&Berman Partners Mid Cap Value Portfolio
Janus Mid Cap Portfolio
Loomis Sayles High Yield Bond Portfolio
State Street Research Aggressive Growth Portfolio
Russell 2000(Registered) Index Portfolio
T. Rowe Price Small Cap Growth Portfolio
Scudder Global Equity Portfolio
Morgan Stanley EAFE(Registered)
Index Portfolio
Santander International Stock Portfolio
Some of the investment choices may not be available under the terms of your
Deferred Annuity or Income Annuity. Your contract will indicate the investment
divisions that are available to you. Your investment choices may be limited
because:
o Some of the investment divisions are not approved in your state.
o Your employer, association or other group contractholder limits the number of
available investment divisions.
o We have restricted the available investment divisions.
o For Income Annuities, some states limit you to four choices (four investment
divisions or three investment divisions and the Fixed Income Option).
The investment divisions buy and sell shares of corresponding mutual fund
portfolios. These Portfolios, which are part of the Metropolitan Fund, invest in
stocks, bonds and other investments. All dividends declared by the Portfolios
are earned by the Separate Account and reinvested. Therefore, no dividends are
distributed to you under the Deferred Annuities or Income Annuities. Dividends
generally are reflected in an increase in the Accumulation or Annuity Unit
Value. You pay no transaction expenses (i.e., front end or back-end load sales
charges) as a result of the Separate Account's purchase or sale of these mutual
fund shares. The Portfolios of the Metropolitan Fund are available only by
purchasing MetLife annuities and life insurance policies and are never sold
directly to the public.
________________________________________________________________________________
The degree of investment risk you assume will depend on the investment divisions
you choose. We have listed your choices in order of risk from the most
conservative to the most aggressive.
There is a possibility you will lose principal in the investment choices.
However, they generally offer the opportunity for greater returns over the long
term than our guaranteed fixed options.
While the investment divisions and their comparably named Portfolios may have
names, investment objectives and management which are identical or similar to
publicly available mutual funds, these are not those mutual funds. The
Metropolitan Fund Portfolios most likely will not have the same performance
experience as any publicly available mutual fund.
________________________________________________________________________________
A-PPA-15
<PAGE>
The Metropolitan Fund is a "series" type fund registered with the Securities and
Exchange Commission as an "open-end management investment company" under the
Investment Company Act of 1940 (the "1940 Act"). A "series" fund means that each
Portfolio is one of several available through the Metropolitan Fund. Except for
the Janus Mid Cap Portfolio, each Portfolio is "diversified" under the 1940 Act.
The Metropolitan Fund and each Portfolio are more fully described in the
Metropolitan Fund's prospectus and its SAI. The Metropolitan Fund's prospectus
is attached at the end of this Prospectus. The SAI is available upon your
request.
The Portfolios of the Metropolitan Fund pay us a monthly fee for our services as
investment manager. These fees, as well as the operating expenses paid by each
Portfolio, are described in the Metropolitan Fund prospectus and SAI.
In addition, the Metropolitan Fund prospectus discusses other separate accounts
of MetLife and Metropolitan Tower Life Insurance Company that invest in the
Metropolitan Fund. The risks of these arrangements are also discussed.
Deferred Annuities
This Prospectus describes five kinds of Deferred Annuities under which you can
accumulate money:
o Non-Qualified
o Traditional IRAs (Individual Retirement Annuities)
o Roth IRAs (Roth Individual Retirement Annuities)
o SIMPLE IRAs (Savings Incentive Match Plan for Employees
Individual Retirement Annuities)
o SEPs (Simplified Employee Pensions)
Certain group Deferred Annuities may be issued to a bank that does nothing but
hold them as contractholder.
The Deferred Annuity and Your Retirement Plan
If you participate through a retirement plan, the Deferred Annuity may provide
that all or some of your rights as described in this Prospectus are subject to
the plan's terms. Limitations on your rights may apply to investment choices,
purchase payments, withdrawals, transfers, the death
________________________________________________________________________________
These Deferred Annuities may be either issued to you as an individual or to a
group (you are then a participant under the group's Deferred Annuity)
________________________________________________________________________________
A-PPA-16
<PAGE>
benefit and pay-out options. We may rely on your employer's or plan
administrator's statements to us as to the terms of the plan or your entitlement
to any amounts. We will not be responsible for determining what your plan says.
You should consult your Deferred Annuity contract and plan document to see how
you may be affected.
Automated Investment Strategies
There are five automated investment strategies available to you. As with any
investment program, no strategy can guarantee a gain - you can lose money. We
may modify or terminate any of the strategies at any time. You may have only one
automated investment strategy in effect at a time.
The Equity Generator(Service Mark): An amount equal to the interest earned in
the Fixed Interest Account is transferred monthly to either the MetLife Stock
Index or State Street Research Aggressive Growth investment division, based on
your selection.
If you elect the Equity Generator at the time you purchase your
Deferred Annuity and you never request allocation changes or transfers, when you
withdraw money the early withdrawal charge will not exceed any earnings under
the Deferred Annuity.
The Equalizer(Service Mark): Each quarter amounts are transferred
between the Fixed Interest Account and, based on your selection, either the
MetLife Stock Index or State Street Research Aggressive Growth investment
division to make the value of each equal.
The Rebalancer(Service Mark): You select a
specific asset allocation from among the investment divisions and the Fixed
Interest Account. Each quarter, we transfer amounts among these options to bring
the percentage of your balance in each option back to your original allocation.
The Index Selector(Service Mark): You may select one of five asset allocation
models which are designed to correlate to various risk tolerance levels. Based
on the model you choose, your entire Account Balance is divided among the Lehman
Brothers Aggregate Bond Index, MetLife Stock Index, Morgan Stanley
EAFE(Registered) Index and Russell 2000 Index investment divisions and the Fixed
Interest Account. Each quarter, the percentage in each of these investment
divisions and the Fixed Interest Account is brought back to the original
percentage by transferring amounts among the investment divisions and the Fixed
Interest Account.
In the future, we may permit you to allocate less than 100% of your Account
Balance to this strategy. This strategy may experience more volatility than our
other strategies. The models are subject to change from time to time. We provide
the elements to formulate the models. We may rely on a third party for its
expertise in creating appropriate allocations.
________________________________________________________________________________
We created these investment strategies to help you manage your money. You decide
if one is appropriate for you, based upon your risk tolerance and saving goals.
These strategies were designed to help you take advantage of the tax-deferred
status of an annuity.
________________________________________________________________________________
A-PPA-17
<PAGE>
The Allocator(Service Mark): Each month a dollar amount you choose is
transferred from the Fixed Interest Account to any of the investment divisions
you choose. You select the day of the month and the number of months over which
the transfers will occur. A minimum transfer of $50 is the only requirement.
The Equity Generator and the Allocator are dollar cost averaging strategies.
Dollar cost averaging involves investing at regular intervals of time. Since
this involves continuously investing regardless of fluctuating prices, you
should consider whether you can continue the strategy through periods of
fluctuating prices.
Purchase Payments
There is no minimum purchase payment. You may continue to make purchase payments
while you receive Systematic Withdrawal Program payments, as described later in
this Prospectus, unless your purchase payments are made through automatic
payroll deduction, check-o-matic, salary reduction or salary deduction.
Allocation of Purchase Payments
You decide how your money is allocated among the Fixed Interest Account and the
investment divisions. You can change your allocations for additional purchase
payments. We will make allocation changes when we receive your request for a
change. You may also specify an effective date for the change as long as it is
within 30 days after we receive the request.
Automated Purchase Payments
If you purchase a Traditional IRA, a Roth IRA or a Non-Qualified Deferred
Annuity, you may elect to have purchase payments made automatically. With
"automatic payroll deduction" your employer deducts an amount from your salary
and makes the purchase payment for you. With "check-o-matic" your bank deducts
money from your checking account and makes the purchase payment for you.
Electronic Applications
When circumstances permit, we may be able to electronically submit your complete
initial application to your MetLife Designated Office. If you elect to use this
process, our local office or your sales representative will actually transmit
the record of your purchase payment and application. Your actual purchase
payment, application and other related documents will then be forwarded to your
MetLife Designated Office. We may, for certain Deferred Annuities, treat the
electronic purchase payment as though we had received payment at your MetLife
Designated Office in order to credit and value the purchase payment.
We may do this if:
o The electronic purchase payment is received at your MetLife Designated
Office and accompanied by a properly completed electronic application
record; and
________________________________________________________________________________
You may make purchase payments to your Deferred Annuity whenever you choose, up
to the date you begin receiving payments from a pay-out option. However, Federal
tax rules may limit the amount and frequency of your purchase payments.
________________________________________________________________________________
A-PPA-18
<PAGE>
o Your money, application and other documentation are received in good order
at your MetLife Designated Office within five business days following the
transmission of the electronic record. Generally, the electronic record is
received at your MetLife Designated Office the business day following its
transmission by the sales representative or local office.
If, however, your purchase payment and paper copy of the application are
received at your MetLife Designated Office before the electronic record,
then your purchase payment will be credited and valued as of the date it is
received.
Limits on Purchase Payments
Your ability to make purchase payments may be limited by:
o Federal tax laws;
o Our right to limit the total of your purchase payments to $500,000. We may
change the maximum by telling you in writing at least 90 days in advance;
and
o Regulatory requirements. For example, if you reside in Washington or
Oregon, we may be required to limit your ability to make purchase payments
after you have held the Deferred Annuity for more than three years, if the
Deferred Annuity was issued to you after you were age 60, or after you turn
age 63, if the Deferred Annuity was issued before you were age 61.
The Value of Your Investment
Accumulation Units are credited to you when you make purchase payments or
transfers into an investment division. When you withdraw or transfer money from
an investment division, accumulation units are liquidated. We determine the
number of accumulation units you have by dividing the amount of your purchase
payment, transfer or withdrawal by the Accumulation Unit Value on the date of
the transaction.
This is how we calculate the Accumulation Unit Value for each investment
division:
o First, we determine the change in investment performance (including any
investment-related charge) for the underlying Portfolio from the previous
trading day to the current trading day;
o Next, we subtract the daily equivalent of our insurance-related charge
(general administrative expense and mortality and expense risk charges) for
each day since the last Accumulation Unit Value was calculated; and
o Finally, we multiply the previous Accumulation Unit Value by this result.
A-PPA-19
<PAGE>
Examples
Calculating the Number of Accumulation Units
Assume you make a purchase payment of $500 into one investment division and that
investment division's Accumulation Unit Value is currently $10.00. You would be
credited with 50 accumulation units.
$500/10 = 50 accumulation units
Calculating the Accumulation Unit Value
Assume yesterday's Accumulation Unit Value was $10.00 and the number we
calculate for today's investment experience (minus charges) for an underlying
portfolio is 1.05. Today's Accumulation Unit Value is $10.50. The value of your
$500 investment is then $525.
$10.00 x 1.05 = $10.50 is the new Accumulation Unit Value
However, assume that today's investment experience (minus charges) is .95
instead of 1.05. Today's Accumulation Unit Value is $9.50. The value of your
$500 investment is then $475.
$10.00 x .95 = $9.50 is the new Accumulation Unit Value
Transfers
You can make an unlimited number of transfers between investment divisions or
between the investment divisions and the Fixed Interest Account. For us to
process a transfer, you must tell us:
o The percentage or dollar amount of the transfer;
o The investment division (or Fixed Interest Account) from which you want the
money to be transferred;
o The investment division (or Fixed Interest Account) to which you want the
money to be transferred; and
o Whether you intend to start, stop or modify an automated investment strategy
by making the transfer.
We may require you to:
o Use our forms;
o Maintain a minimum Account Balance (if the transfer is in connection with an
automated investment strategy); or
o Transfer a minimum amount if the transfer is in connection with the Allocator.
________________________________________________________________________________
You may transfer money within your contract as often as you like without
incurring current taxes on your earnings.
________________________________________________________________________________
A-PPA-20
<PAGE>
Access To Your Money
You may withdraw either all or a part of your Account Balance from the Deferred
Annuity. Withdrawals must be at least $500 (or the Account Balance, if less). To
process your request, we need the following information:
o The percentage or dollar amount of the withdrawal; and
o The investment division (or Fixed Interest Account) from which you want the
money to be withdrawn.
If you request, generally you can tell us to make payments directly to other
investments on a tax-free basis. You may only do so if all applicable tax and
state regulatory requirements are met and we receive all information necessary
for us to make the payment. We may require you to use our forms.
________________________________________________________________________________
Income taxes, tax penalties and early withdrawal charges may apply to any
withdrawal you make.
We will withdraw the payments from the Fixed Interest Account or investment
divisions you select, either pro rata or in the proportions you request. Each
payment must be at least $50.
________________________________________________________________________________
Systematic Withdrawal Program
Under this program and subject to approval in your state, you may choose to
automatically withdraw a specific dollar amount or a percentage of your Account
Balance each Contract Year. This amount is then paid in equal portions
throughout the Contract Year according to the time frame you select, e.g.,
monthly, quarterly, semi-annually or annually. Once the Systematic Withdrawal
Program is initiated, the payments will automatically renew each Contract Year.
If you elect to withdraw a dollar amount, we will pay you the dollar amount each
Contract Year. If you elect to withdraw a percentage of your Account Balance,
each Contract Year we recalculate the dollar amount you will receive based on
your new Account Balance.
Calculating Your Payment Based on a Percentage Election for the First Contract
Year You Elect the Systematic Withdrawal Program: If you choose to receive a
percentage of your Account Balance, we will determine the dollar amount payable
on the date these payments begin. When you first elect the program, we will pay
this dollar amount over the remainder of the Contract Year. For example, if you
select to receive payments on a monthly basis, the percentage of your Account
Balance you request equals $12,000, and there are six months left in the
Contract Year, we will pay you $2,000 a month.
Calculating Your Payment for Subsequent Contract Years of the Systematic
Withdrawal Program: For each subsequent year that your Systematic Withdrawal
Program remains in effect, we will deduct from your Deferred Annuity and pay you
over the Contract Year either the dollar amount that you chose or a dollar
amount equal to the percentage of your Account Balance you chose. For example,
if you select to receive payments on a monthly basis, ask for a percentage and
that percentage equals $12,000 at the start of a Contract Year, we will pay you
$1,000 a month.
A-PPA-21
<PAGE>
If you do not provide us with your desired allocation, or there are insufficient
amounts in the investment divisions or the Fixed Interest Account that you
selected, the payments will be taken out pro rata from the Fixed Interest
Account and any investment divisions in which you then have money.
________________________________________________________________________________
If you would like to receive your systematic withdrawal payment on or about the
first of the month, you should request that the payment date be the 20th day of
the month.
Your Account Balance will be reduced by the amount of your systematic withdrawal
payments and applicable withdrawal charges. Payments under this program are not
the same as income payments you would receive from a Deferred Annuity
pay-out option or under an Income Annuity.
________________________________________________________________________________
Selecting a Payment Date: Your payment date is the date we make the withdrawal.
When you select or change a payment date, we must receive your request at least
10 days prior to the selected payment date. If we do not receive your request in
time, we will make the payment a month after the date you selected. If you do
not select a payment date, we will automatically begin systematic withdrawals
within 30 days after we receive your request. Changes in the dollar amount,
percentage, or timing of payments can be made at the beginning of any Contract
Year and once a year. However, we must receive your request at least 30 days in
advance. If you make any of these changes, we will treat your contract as though
you were starting a new Systematic Withdrawal Program.
Although we need your written authorization to begin this program, you may
cancel this program at any time by telephone or by writing to us at your MetLife
Designated Office.
Systematic Withdrawal Program payments may be subject to an early withdrawal
charge unless an exception to this charge applies. For purposes of determining
how much of the annual payment amount is exempt from this charge under the free
withdrawal provision (discussed later), all Systematic Withdrawal Program
payments in a Contract Year are characterized as a single lump sum withdrawal as
of your first payment date in that Contract Year. When you first elect the
program, we will calculate the percentage of your Account Balance your
Systematic Withdrawal Payment represents based on your Account Balance on the
first Systematic Withdrawal Program payment date. For all subsequent Contract
Years, we will calculate the percentage of your Account Balance your Systematic
Withdrawal payment represents based on your Account Balance on the first
Systematic Withdrawal Program payment date of that Contract Year. We will
determine separately the early withdrawal charge and any relevant factors (such
as applicable exceptions) for each Systematic Withdrawal Program payment as of
the date it is withdrawn from your Deferred Annuity.
Minimum Distribution
In order for you to comply with certain tax law provisions, you may be required
to take money out of your Deferred Annuity. Rather than receiving your minimum
distribution in one annual lump-sum payment, you may request that we pay it to
you in installments throughout the calendar year. However, we may require that
you maintain a certain Account Balance at the time you request these payments.
Contract Fee
There is no Separate Account annual contract fee.
A-PPA-22
<PAGE>
o For the Non-Qualified Tradional IRA, Roth IRA and SEP Deferred Annuities,
you pay a $20 annual fee from the Fixed Interest Account at the end of each
Contract Year if your Account Balance is less than $20,000 and you are not
enrolled in the check-o-matic or automatic payroll deduction programs.
o For the SIMPLE IRA Deferred Annuity, you pay a $20 annual fee from the
Fixed Interest Account at the end of each Contract Year if your Account
Balance is less than $20,000 and you do not make a purchase payment during
the Contract Year.
Charges
There are two types of charges you pay while you have money in an investment
division:
o Insurance-related charge, and
o Investment-related charge.
Insurance-Related Charge
You will pay an insurance-related charge for the Separate Account that is no
more than 1.25% annually of the average value of the amount you have in the
Separate Account. This charge pays us for general administrative expenses and
for the mortality and expense risk of the Deferred Annuity.
General administrative expenses we incur include financial, actuarial,
accounting, and legal expenses.
The mortality portion of the insurance-related charge pays us for the risk that
you may live longer than we estimated. Then, we could be obligated to pay you
more in payments from a pay-out option than we anticipated. Also, we bear the
risk that the guaranteed death benefit we would pay should you die during your
"pay-in" phase is larger than your Account Balance. We also bear the risk that
our expenses in administering the Deferred Annuities may be greater than we
estimated (expense risk).
Investment-Related Charge
This charge pays us as the investment manager of the Metropolitan Fund for
managing money in the Portfolios and investment operating expenses. The
percentage you pay depends on which investment divisions you select. Amounts for
each investment division are listed in the Table of Expenses.
________________________________________________________________________________
The charges you pay will not reduce the number of accumulation units credited to
you. Instead, we deduct the charges each time we calculate the Accumulation Unit
Value.
MetLife guarantees that the Separate Account insurance-related charge will not
increase while you have a Deferred Annuity.
________________________________________________________________________________
A-PPA-23
<PAGE>
Annuity Taxes
Some jurisdictions tax what are called "annuity considerations." These may
apply to purchase payments, Account Balances and death benefits. In most
jurisdictions, we currently do not deduct any money from purchase payments,
Account Balances or death benefits to pay these taxes. Generally, our practice
is to deduct money to pay annuity taxes (also known as "premium" taxes) only
when you exercise a pay-out option. In certain jurisdictions, we may also
deduct money to pay annuity taxes on lump sum withdrawals or when you exercise
a pay-out option. We may deduct an amount to pay annuity taxes some time in
the future since the laws and the interpretation of the laws relating to
annuities are subject to change.
A chart in the Appendix shows the jurisdictions where annuity taxes are
charged and the amount of these taxes.
Early Withdrawal Charges
An early withdrawal charge of up to 7% may apply if you withdraw purchase
payments within 7 years of when they were credited to your Deferred Annuity.
To determine the early withdrawal charge for Deferred Annuities, we treat your
Fixed Interest Account and Separate Account as if they were a single account
and ignore both your actual allocations and the Fixed Interest Account or
investment division from which the withdrawal is actually coming. To do this,
we first assume that your withdrawal is from amounts (other than earnings)
that can be withdrawn without an early withdrawal charge, then from other
amounts (other than earnings) and then from earnings, each on a
"first-in-first-out" (oldest money first) basis. Once we have determined the
amount of the early withdrawal charge, we will actually withdraw it from the
Fixed Interest Account and the investment divisions in the same proportion as
the withdrawal is being made. In determining what the withdrawal charge is, we
do not include earnings, although the actual withdrawal to pay it may come
from earnings.
________________________________________________________________________________
You will not pay an early withdrawal charge on any purchase payments made more
than 7 years ago.
We do not include your earnings when calculating early withdrawal charges.
However, if the early withdrawal charge is greater than the available purchase
payments, then we will take the early withdrawal charges, in whole or in part,
from your earnings.
________________________________________________________________________________
For partial withdrawals, the early withdrawal charge is determined by dividing
the amount that is subject to the early withdrawal charge by 100% minus the
applicable percentage shown in the following chart. Then we will make the
payment directed and withdraw the early withdrawal charge.
For a full withdrawal we multiply the amount to which the withdrawal charge
applies by the percentage shown, keep the result as an early withdrawal charge
and pay you the rest. We will treat your request as a request for a full
withdrawal if your Account Balance is not sufficient to pay both the requested
withdrawal and the early withdrawal charge.
The early withdrawal charge on purchase payments withdrawn is as follows:
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During Purchase Payment Year
Year 1 2 3 4 5 6 7 8 & Later
Percentage 7% 6% 5% 4% 3% 2% 1% 0
By law, your total early withdrawal charges applied to amounts in the
investment divisions will never exceed 9% of all your purchase payments in the
investment divisions.
The early withdrawal charge reimburses us for our costs in selling the
Deferred Annuities. We may use our profits (if any) from the mortality and
expense risk charge to pay for our costs to sell the Deferred Annuities which
exceed the amount of early withdrawal charges we collect. However, we believe
that our sales costs may exceed the early withdrawal charges we collect. If
so, we will pay the difference out of our general profits.
________________________________________________________________________________
Early withdrawal charges never apply to transfers among investment divisions
or transfers to or from the Fixed Interest Account.
________________________________________________________________________________
When No Early Withdrawal Charge Applies
In some cases, we will not charge you the early withdrawal charge when you
make a withdrawal. We may, however, ask you to prove that you meet any
conditions listed below.
You do not pay an early withdrawal charge:
o On transfers you make within your Deferred Annuity.
o On withdrawals of purchase payments you made over seven years ago.
o If you choose payments over one or more lifetimes or for a period of at
least five years (without the right to accelerate the payments).
o If you die during the pay-in phase. Your beneficiary will receive the full
death benefit without deduction.
o If you withdraw up to to 10% of your Account Balance in a Contract Year.
This 10% total withdrawal may be taken in an unlimited number of partial
withdrawals during that Contract Year. Each time you make a withdrawal, we
calculate what percentage your withdrawal represents at that time. Only when
the total of these percentages exceeds 10% will you have to pay early
withdrawal charges.
o If the withdrawal is required for you to avoid Federal income tax penalties
or to satisfy Federal income tax rules or Department of Labor regulations
that apply to your Deferred Annuity. This exception does not apply if you
have a Non-Qualified or Roth IRA Deferred Annuity.
o Because you accept an amendment converting your Traditional IRA Deferred
Annuity to a Roth IRA Deferred Annuity.
o If your contract provides for this, on your first withdrawal to which an
early withdrawal charge would otherwise apply, and either you or your
spouse:
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o Has been a resident of certain nursing home facilities for a minimum of 90
consecutive days; or
o Is diagnosed with a terminal illness and not expected to live more than a
year.
When Another Early Withdrawal Charge May Apply
If you transferred money from certain eligible MetLife contracts into a
Deferred Annuity. You may have different early withdrawal charges for these
transfer amounts. Any purchase payments made after the transfer are subject to
the usual early withdrawal charge schedule.
o Amounts transferred before January 1, 1996:
o We credit your transfer amounts with the time you held them under your
original contract or if it will produce a lower charge;
o We use the following schedule to determine early withdrawal charges
(determined as previously described) for transferred amounts from your
original contract.
During Purchase Payment Year
Year 1 2 3 4 5 6 and Beyond
Percentage 5% 4% 3% 2% 1% 0%
o Amounts transferred on or after January 1, 1996:
o For certain contracts which we issued at least two years before the date
of transfer (except as noted below), we apply the withdrawal charge under
your original contract but not any of the original contract's exceptions
or reductions to the withdrawal charge percentage that do not apply to a
Deferred Annuity or if it will produce a lower charge.
o We use the following schedule to determine early withdrawal charges for
transferred amounts from your original contract:
After the Transfer
Year 1 2 3 4 5 6 and Beyond
Percentage 5% 4% 3% 2% 1% 0%
o If we issued the other contract less than two years before the date of the
transfer or it has a separate withdrawal charge for each purchase
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payment, we treat your purchase payments under the other contract as
if they were made under the Deferred Annuity as of the date we
received them under that contract.
o Alternatively, if provided for in your Deferred Annuity, we credit your
purchase payments with the time you held them under your original contract.
Free Look
You may cancel your Deferred Annuity within a certain time period. This is
known as a "free look." We must receive your request to cancel in writing. The
number of days for this "free look" varies from state to state. The time
period may also vary depending on your age and whether you purchased your
Deferred Annuity from us directly, through the mail or with money from another
annuity or life insurance policy. Again, depending on state law, we may refund
all of your purchase payments or your Account Balance as of the date your
refund request is received at your MetLife Designated Office.
Death Benefit
One of the insurance guarantees we provide you under your Deferred Annuity is
that your beneficiaries will be protected against market downturns. You name
your beneficiary(ies). If you die during the pay-in phase, the death benefit
your beneficiary receives will be the greatest of:
o Your Account Balance;
o Your highest Account Balance as of the end of the fifth calendar year in
which you have the Deferred Annuity and as of the end of each later five
year period. In any case, less any later partial withdrawals, fees and
charges; or
o The total of all of your purchase payments less any partial withdrawals.
We will only pay the death benefit when we receive both proof of your death
and appropriate instructions for payment.
Your beneficiary has the option to apply the death benefit (less any
applicable annuity taxes) to a pay-out option offered under your Deferred
Annuity. Your beneficiary may, however, decide to take a lump sum cash
payment.
Pay-out Options (or Income Options)
You may receive a regular stream of money after your "pay-in" or
"accumulation" phase. When you select your pay-out option, you will be able to
choose from the range of options we then have available. If you decide you
want a pay-out option, we withdraw some or all of your Account Balance (less
any annuity taxes and applicable contract fees). Then, we apply the remainder
to the option. Generally, you may defer receiving payments for up to one year
after you have chosen your pay-out option.
________________________________________________________________________________
The pay-out phase is often referred to as either "annuitizing" your contract
or taking an income annuity. Should our current immediate annuity rates for a
fixed pay-out option provide for greater payments than those quoted in your
contract, we will use the current rates.
________________________________________________________________________________
When considering a pay-out option, you should think about whether:
o You want payments guaranteed by us for the rest of your life (or for the
rest of two lives) or for a specified period;
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o You want a fixed dollar payment or a variable payment;
o You want a refund feature.
Your income payment amount will depend upon the option you choose. For
lifetime options, the age and sex of the measuring lives (annuitants) will
also be considered.
By the date specified in your contract, if you do not either elect to continue
the contract, select a pay-out option or withdraw your entire Account Balance,
and your Deferred Annuity was not issued under a retirement plan, we will
automatically issue you a life annuity with a 10 year guarantee. In that case,
if you do not tell us otherwise, your Fixed Interest Account Balance will be
used to provide a Fixed Income Option and your Separate Account Balance will
be used to provide a variable pay-out option. However, if we do ask you what
you want us to do and you do not respond, we may treat your silence as a
request by you to continue your Deferred Annuity.
Because many of the features of variable pay-out options under the Deferred
Annuities are identical to the features of Income Annuities, we are providing
more information about variable pay-out options under the "Income Annuities"
heading.
Income Annuities
Income Annuities provide you with a regular stream of payments for either your
lifetime or a specific period. Income Annuities can be purchased so that you
begin receiving payments immediately or you can apply the Account Balance of
your Deferred Annuity to a pay-out option to receive payments during your
"pay-out" phase. With an Income Annuity, you must start receiving payments
within the first year after the annuity is issued.
________________________________________________________________________________
You may choose the frequency of your income payments. For example, you may
receive your payments on a monthly, quarterly, semiannual or annual basis.
________________________________________________________________________________
We do not guarantee that your variable payments will be a specific amount of
money. You may choose to have a portion of the payment fixed and guaranteed
under the Fixed Income Option.
Using proceeds from the following types of arrangements, you may purchase
Income Annuities to receive immediate payments:
o Non-Qualified o Roth IRA
o Traditional IRAs o SEP IRA
o SIMPLE IRA
If you have accumulated amounts in any of the listed investment vehicles, your
lump sum withdrawal from that investment vehicle may be used to purchase an
appropriate Income Annuity as long as income tax requirements are met.
If your retirement plan has purchased an Income Annuity, your choice of
pay-out options may be subject to the terms of the plan. We may rely on your
employer's or plan administrator's statements to us as to the terms of the
plan or your entitlement to any payments. We will not be responsible for
interpreting the terms of your plan. You should review your plan document to
see how you may be affected.
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Income Payment Types
Currently, we provide you with a wide variety of income payment types to suit
a range of personal preferences.
There are three people who are involved in payments under your Income Annuity:
o Owner: the person or entity which has all rights under the Income Annuity
including the right to direct who receives payment.
o Annuitant: the person whose life is the measure for determining the timing
and sometimes the dollar amount of payments.
o Beneficiary: the person who receives continuing payments/or a lump sum
payment if the owner dies.
________________________________________________________________________________
Many times, the Owner and the Annuitant are the same person.
________________________________________________________________________________
The following income payment types are available:
Your Lifetime Annuity: A variable income payable during the annuitant's life.
________________________________________________________________________________
When deciding how to receive income, consider:
o The amount of income you need;
o The amount you expect to receive from other sources;
o The growth potential of other investments; and
o How long you would like your income to last.
________________________________________________________________________________
Your Lifetime with a Guaranteed Period Annuity:
A variable income payable during the annuitant's life with a guaranteed number
of years. If, at the death of the annuitant, payments have been made for less
than the guaranteed period, payments are made to the owner of the annuity (or
the beneficiary if the owner dies before the end of the guaranteed period) for
the rest of the guaranteed period.
Your Lifetime With a Refund Annuity: A variable income payable during the
annuitant's life with a refund provision. If, at the death of the annuitant,
the total of all income payments is less than the purchase payment that we
received, we will pay the owner of the annuity (or to the beneficiary if the
owner is not alive) an amount equal to the difference.
Income for Two Lives Annuity: A variable income payable while either of two
annuitants is alive. After one annuitant dies, payments continue if the other
annuitant is alive. Payments stop once both annuitants are no longer alive.
Payments after one annuitant dies may be the same as those paid while both
were alive or may be a lower percentage that is selected when the annuity is
purchased (e.g. 75%, 66 2/3% or 50%).
Income for Two Lives with a Guaranteed Period Annuity: This is the same as the
Income for Two Lives Annuity described above, but we guarantee to pay the full
amount (not a reduced percentage) for the guaranteed period even if one or
both annuitants die. If, upon the death of both annuitants, payments have been
made for less than the guaranteed period, payments are made to the owner of
the annuity (or the beneficiary if the owner dies before the end of the
guaranteed period) for the rest of the guaranteed period.
Income for Two Lives with a Refund Annuity: This is the same as the Income for
Two Lives Annuity described above, but if, upon the death of
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both annuitants, the total of all of income payments is less than the purchase
payment that we received, we will pay the owner of the annuity (or the
beneficiary if the owner is not alive) an amount equal to the difference.
Income for a Guaranteed Period Annuity: A variable income payable for a
guaranteed period (5-30 years). Payments cease at the end of the guaranteed
period (which is often called a "term certain" period) even if the annuitant
is still alive. If the annuitant dies before the end of the guaranteed period,
payments are made to the owner of the annuity (or to the beneficiary if the
owner dies before the end of the guaranteed period) for the rest of the
guaranteed period.
Purchasing an Income Annuity
Your purchase payment must be large enough to produce an initial income
payment of at least $50. If you live in Massachusetts, the initial income
payment must be at least $20.
Allocation of Your Purchase Payment
You decide how your money is allocated among the Fixed Income Option and the
investment divisions.
The Value of Your Income Payments
Annuity units are credited to you when you make a purchase payment or transfer
into an investment division. When you transfer money from an investment
division, annuity units in that investment division are liquidated. Before we
determine the number of annuity units you have, we reduce your purchase
payment by any annuity taxes and the contract fee, if applicable. We then
divide the remainder by the Annuity Unit Value on the date of the transaction.
________________________________________________________________________________
The AIR is stated in your contract and may range from 3% to 6%.
________________________________________________________________________________
Your payment is determined by using the Assumed Investment Return ("AIR") to
benchmark the investment experience of the investment divisions you select.
The higher your AIR, the higher your first income payment will be. Your next
payments will only increase in proportion to the amount the investment
experience of your chosen investment divisions exceeds the AIR and Separate
Account charges. Likewise, your payments will decrease to the extent the
investment experience of your chosen investment divisions is less than the AIR
and Separate Account charges. A lower AIR will result in a lower initial
variable income payment, but subsequent variable income payments will increase
more rapidly or decline more slowly as changes occur in the investment
experience of the investment divisions.
Your income payments are determined ten days prior to your income payment date
or your contract's issue date, if later.
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This is how we calculate the Annuity Unit Value for each investment division:
o First, we determine the change in investment experience (including any
investment-related charge) for the underlying portfolio from the previous
trading day to the current trading day;
o Next, we subtract the daily equivalent of your insurance-related charge
(general administrative expenses and mortality and expense risk charges) for
each day since the last day the Annuity Unit Value was calculated;
o Then, we divide by the daily equivalent of your AIR; and
o Finally, we multiply the previous Annuity Unit Value by this result.
Transfers
You can make an unlimited number of transfers among investment divisions or
from the investment divisions to the Fixed Income Option. If you reside in
certain states you may be limited to four options (including the Fixed
Interest Option).
For us to process a transfer, you must tell us:
o The percentage or dollar amount of the transfer;
o The investment division (or Fixed Income Option) to which you want to
transfer; and
o The investment division from which you want to transfer.
We may require that you use our forms to make transfers.
________________________________________________________________________________
Once you transfer money into the Fixed Income Option you may not later
transfer it into an investment division.
________________________________________________________________________________
Contract Fee
A one time $350 contract fee is taken from your purchase payment prior to
allocating the remainder of the purchase payment to either the investment
divisions and/or the Fixed Income Option. This charge covers our
administrative costs including preparation of the Income Annuities, review of
applications and recordkeeping. If you select a pay-out option under your
Deferred Annuity and you purchased that Deferred Annuity at least two years
ago, we will waive the contract fee.
Charges
There are two types of charges you pay if you allocate any of your purchase
payment to the investment divisions:
o Insurance-related charge; and
o Investment-related charge.
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Insurance-Related Charge
You will pay an insurance-related charge for the Separate Account that is no
more than 1.25% annually of the average value of the amount you have in the
Separate Account. This charge pays us for general administrative expenses and
for mortality and expense risk of the Income Annuity.
General administrative expenses we incur include financial, actuarial,
accounting, and legal expenses.
The mortality portion of the insurance-related charge pays us for the risk
that you may live longer than we estimated. Then, we could be obligated to pay
you more in payments than we anticipated.
We also bear the risk that our expenses in administering the Income Annuities
will be greater than we estimated (expense risk).
________________________________________________________________________________
The charges you pay will not reduce the number of annuity units credited to
you. Instead, we deduct the charges when calculating the Annuity Unit Value.
________________________________________________________________________________
Investment-Related Charge
This charge pays us as the investment manager of the Metropolitan Fund for
managing money in the Portfolios and investment operating expenses. The
percentage you pay depends on the investment divisions you select. Amounts for
each investment division are listed in the Table of Expenses.
Annuity Taxes
Some jurisdictions tax what are called "annuity considerations." We deduct
money to pay "annuity" taxes (also known as "premium" taxes) when you make the
purchase payment. A chart in the Appendix shows the jurisdictions where
annuity taxes are charged and the amount of these taxes.
Free Look
You may cancel your Income Annuity within a certain time period. This is known
as a "free look." We must receive your request to cancel in writing. The
number of days for this "free look" varies from state to state. The "free
look" may also vary depending on your age and whether you purchased your
Income Annuity from us directly, through the mail or with money from another
annuity or life insurance policy. Again, depending on state law, we may refund
all of your purchase payment or the value of your annuity units as of the date
your refund request is received at your MetLife Designated Office.
________________________________________________________________________________
You do not have a "free look" if you are electing income payments in the
pay-out phase of your Deferred Annuity.
________________________________________________________________________________
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General Information
Administration
All transactions will be processed in the manner described below.
Purchase Payments
Send your purchase payments by check or money order made payable to "MetLife"
to your MetLife Designated Office. We will provide you with all necessary
forms. We must have all completed documents to credit your purchase payments.
________________________________________________________________________________
Generally, your requests including all subsequent purchase payments are
effective the day we receive them at your MetLife Designated Office.
________________________________________________________________________________
Usually, your initial purchase payment is credited to you within two days of
receipt at your MetLife Designated Office. However, if you fill out our forms
incorrectly or incompletely or other documentation is not completed properly,
we have up to five business days to credit the payment. If the problem cannot
be resolved by the fifth business day, we will notify you and give you the
reasons for the delay. At that time, you will be asked whether you agree to
let us keep your money until the problem is resolved. If you do not agree or
we cannot reach you by the fifth business day, your money will be returned.
Under certain group Deferred Annuities and group Income Annuities, your
employer, or the group in which you are a participant or member must identify
you on their reports to us and tell us how your money should be allocated
among the investment divisions and the Fixed Interest Account/Fixed Income
Option.
Purchase payments (including any portion of your Account Balance under a
Deferred Annuity which you apply to a pay-out option) are effective and valued
as of 4:00 p.m. Eastern time, on the day we receive them in good order at your
MetLife Designated Office, except when they are received:
o On a day when the Accumulation Unit Value/Annuity Unit Value is not
calculated, or
o After 4:00 p.m. Eastern time.
In those cases, the purchase payments will be effective the next day the
Accumulation Unit Value or Annuity Unit Value, as applicable, is calculated.
Confirming Transactions
You will receive a written statement confirming that a transaction was
recently completed. Certain transactions made on a periodic basis, such as
check-o-matic, Systematic Withdrawal Program payments, and automated
investment strategy transfers, may be confirmed quarterly.
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Transactions by Telephone
You may conduct a variety of transactions by telephone, unless prohibited by
state law. Some of these transactions include:
o Transfers
o Changes to investment strategies
o Changes in the allocation of future purchase payments.
Your telephone transaction must be completed by 4:00 p.m. Eastern Time if you
want the transaction to take place on that day.
________________________________________________________________________________
You may authorize your sales representative to make telephone transactions on
your behalf. You must complete our form and we must agree.
________________________________________________________________________________
We have put into place reasonable security procedures to insure that
instructions communicated by telephone are genuine. For example, all telephone
calls are recorded. Also, you will be asked to provide some personalized data
prior to giving your instructions over the telephone. When someone contacts us
by telephone and follows our security procedures, we will assume that you are
authorizing us to act upon those telephone instructions. Neither we nor the
Separate Account will be liable for any loss, expense or cost arising out of
any requests that we or the Separate Account reasonably believe to be
authentic. In the unlikely event that you have trouble reaching us, requests
should be made in writing to your MetLife Designated Office.
Processing of Certain Transactions
If we are notified of your death before a requested transaction is completed,
we will cancel the request. For example, if you request a transfer or
withdrawal for a date in the future under a Deferred Annuity and then die
before that date, we simply pay the death benefit instead. For Income Annuity
transfers, we will cancel the request and continue making payments to your
beneficiary if your Income Annuity so provides. Or, depending on your Income
Annuity provisions, we may continue making payments to a joint annuitant or
pay your beneficiary a refund.
Valuation
We separately determine the Accumulation Unit Value and Annuity Unit Value for
each investment division once each day when the New York Stock Exchange is
open for trading. If permitted by law, we may change the period between
calculations but we will give you 30 days notice.
When you request a transaction, we will process the transaction using the next
available Accumulation Unit Value for Deferred Annuities or Annuity Unit Value
for Income Annuities. Subject to our procedure, we will make withdrawals under
a Deferred Annuity and transfers under a Deferred Annuity or Income Annuity at
a later date, if you request. If your withdrawal request is to elect a
variable pay-out option under your
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Deferred Annuity, we base the number of annuity units you receive on the next
available Annuity Unit Value.
Advertising Performance
We periodically advertise the performance of the investment divisions. You may
get performance information from a variety of sources including your quarterly
statements, your MetLife representative, the internet, annual reports and
semiannual reports.
We may state performance in terms of "yield," "change in Accumulation Unit
Value/Annuity Unit Value," "average annual total return," or some combination
of these terms.
Yield is the net income generated by an investment in a particular investment
division for 30 days or a month. These figures are expressed as percentages.
This percentage yield is compounded semiannually.
________________________________________________________________________________
All performance numbers are based upon historical earnings. These numbers are
not intended to indicate future results.
________________________________________________________________________________
Change in Accumulation/Annuity Unit Value is calculated by determining the
percentage change in the value of an accumulation (or annuity) unit for a
certain period. These numbers may also be annualized. Change in
Accumulation/Annuity Unit Value may be used to demonstrate performance for a
hypothetical investment (such as $10,000) over a specified period. These
performance numbers reflect the deduction of the total Separate Account
charges; however, yield and change in Accumulation/Annuity Unit Value
performance do not reflect the possible imposition of early withdrawal
charges. Early withdrawal charges would reduce performance experience.
Average annual total return calculations reflect all Separate Account charges
and applicable early withdrawal charges. These figures also assume a steady
annual rate of return.
Performance figures will vary among the various Deferred Annuities and Income
Annuities as a result of different Separate Account charges and early
withdrawal charges. For purposes of presentation, we may assume that certain
Deferred Annuities and Income Annuities were in existence prior to their
inception date. In these cases, we calculate performance based on the
historical performance of the underlying Metropolitan Fund Portfolios. We use
the actual accumulation unit or annuity unit data after the inception date.
We calculate performance for certain investment strategies including the
Equalizer, Equity Generator and each asset allocation model of the Index
Selector. We calculate the performance as a percentage by presuming a certain
dollar value at the beginning of a period and comparing this dollar value with
the dollar value based on historical performance at the end of that period.
This percentage return assumes that there have been no withdrawals or other
unrelated transactions.
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Changes to Your Deferred Annuity or
Income Annuity
We have the right to make certain changes to your Deferred Annuity or Income
Annuity, but only as permitted by law. We make changes when we think they
would best serve the interest of annuity owners or would be appropriate in
carrying out the purposes of the Deferred Annuity or Income Annuity. If the
law requires, we will also get your approval and the approval of any
appropriate regulatory authorities. Examples of the changes we may make
include:
o To operate the Separate Account in any form permitted by law.
o To take any action necessary to comply with or obtain and continue any
exemptions under the law.
o To transfer any assets in an investment division to another investment
division, or to one or more separate accounts, or to our general account, or
to add, combine or remove investment divisions in the Separate Account.
o To substitute for the Portfolio shares in any investment division, the
shares of another class of the Metropolitan Fund or the shares of another
investment company or any other investment permitted by law.
o To change the way we assess charges, but without increasing the aggregate
amount charged to the Separate Account and any currently available portfolio
in connection with the Deferred Annuities or Income Annuities.
o To make any necessary technical changes in the Deferred Annuities or Income
Annuities in order to conform with any of the above-described actions.
If any changes result in a material change in the underlying investments of an
investment division in which you have a balance, we will notify you of the
change. You may then make a new choice of investment divisions. For Deferred
Annuities issued in Pennsylvania (and Income Annuities where required by law),
we will ask your approval before making any technical changes.
Voting Rights
Based on our current view of applicable law, you have voting interests under
your Deferred Annuity or Income Annuity concerning Metropolitan Fund proposals
that are subject to a shareholder vote. Therefore, you are entitled to give us
instructions for the number of shares which are deemed attributable to your
Deferred Annuity or Income Annuity.
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We will vote the shares of each of the underlying Portfolios held by the
Separate Account based on instructions we receive from those having a voting
interest in the corresponding investment divisions. However, if the law or the
interpretation of the law changes, we may decide to exercise the right to vote
the Portfolio's shares based on our own judgment.
There are certain circumstances under which we may disregard voting
instructions. However, in this event, a summary of our action and the reasons
for such action will appear in the next semiannual report. If we do not
receive your voting instructions, we will vote your interest in the same
proportion as represented by the votes we receive from other investors. Shares
of the Metropolitan Fund that are owned by our general account or by any of
our unregistered separate accounts will be voted in the same proportion as the
aggregate of:
o The shares for which voting instructions are received, and
o The shares that are voted in proportion to such voting instructions.
However, if the law or the interpretation of the law changes, we may decide to
exercise the right to vote the Portfolio's shares based on our judgment.
Who Sells the Deferred Annuities and Income Annuities
All Deferred Annuities and Income Annuities, are sold through our licensed
sales representatives. We are registered with the Securities and Exchange
Commission as a broker-dealer under the Securities Exchange Act of 1934. We
are also a member of the National Association of Securities Dealers, Inc.
Deferred Annuities and Income Annuities are also sold through other registered
broker-dealers. They also may be sold through the mail.
The licensed sales representatives and broker-dealers who sell the annuities
may be compensated for these sales by commissions that we pay. There is no
front-end sales load deducted from purchase payments to pay sales commissions.
The Separate Account does not pay sales commissions. The commissions we pay
range from 0% to 6%.
We also make payments to our licensed sales representatives based upon the
total Account Balances of the Deferred Annuities assigned to the sales
representative. Under this compensation program, we pay an amount up to .12%
of the total Account Balances of the Deferred Annuities and other annuity
contracts, certain mutual fund account balances and cash values of certain
life insurance policies. These asset based commissions compensate the sales
representative for servicing the Deferred Annuities. These payments are not
made for Income Annuities.
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Financial Statements
The financial statements for the Separate Account and MetLife are in the SAI
and are available from MetLife upon request.
When We Can Cancel Your Deferred Annuity or Income Annuity
We may not cancel your Income Annuity.
We may cancel your Deferred Annuity only if we do not receive any purchase
payments from you for 36 consecutive months and your Account Balance is less
than $2,000. We will only do so to the extent allowed by law. If we do so for
a Deferred Annuity delivered in New York, we will return the full Account
Balance. In all other cases, you will receive an amount equal to what you
would have received if you had requested a total withdrawal of your Account
Balance. Early withdrawal charges may apply.
Income Taxes
The following information on taxes is a general discussion of the subject. It
is not intended as tax advice. The Internal Revenue Code ("Code") is complex
and subject to change regularly. For example, certain aspects of the tax
treatment for Roth IRAs still need to be clarified. Consult your own tax
advisor about your circumstances, any recent tax developments, and the impact
of state income taxation. The SAI has additional tax information. For purposes
of this section, we address Deferred Annuities and Income Annuities together
as annuities. In addition, because the tax treatment of Income Annuities and
the pay-out option under Deferred Annuities is generally the same, they are
discussed together as income payments.
________________________________________________________________________________
Simply stated, earnings on Deferred Annuities are generally not subject to
income tax until they are withdrawn. This is known as tax deferral.
________________________________________________________________________________
General
Deferred annuities are a means of setting aside money for future needs-usually
retirement. Congress recognizes how important saving for retirement is and has
provided special rules in the Internal Revenue Code (Code).
All IRA's receive tax deferral under the Code. Although there are no
additional tax benefits by funding your IRA with an annuity, it does provide
you additional insurance benefits such as an available guaranteed income for
life.
We are not responsible for determining if your employer's plan or arrangement
satisfies the requirements of the Code and/or ERISA (the Employee Retirement
Income Security Act of 1974).
A-PPA-38
<PAGE>
Withdrawals
Because these products are intended for retirement, if you make a taxable
withdrawal before age 59 1/2 you may incur a tax penalty. When you withdraw
money from your contract, the amount reported as income differs depending on:
o the type of annuity you purchase, (e.g., Non-Qualified or IRA) and
o the type of pay-out option you elect.
We will withold a portion of the taxable amount of your withdrawal for income
taxes, unless you elect otherwise. The amount we withhold is determined by the
Code.
If you meet certain requirements, your Roth IRA earnings are free from Federal
income taxes.
Withdrawals Before Age 59 1/2
If you receive a taxable distribution from your contract before you reach age
59 1/2, this amount may be subject to a 10% penalty tax, in addition to
ordinary income taxes.
As indicated in the chart below, some distributions prior to age 59 1/2 are
exempt from the penalty. Some of these exceptions include amounts received:
Type of Contract
--------------------------------
Non Trad. Roth Simple
Qualified IRA IRA IRA SEP
----- --- --- --- ---
In a series of substantially
equal payments made annually
(or more frequently) for life
or life expectancy (SEPP) x x x x x
After you die x x x x x
After you become totally
disabled (as defined in the Code) x x x x x
To pay deductible medical expenses x x x x
To pay medical insurance premiums
if you are unemployed x x x x
After December 31, 1997 to pay
for qualified higher education
expenses, or x x x x
After December 31, 1997 for
qualified first time home
purchases up to $10,000 x x x x
* For SIMPLE IRA's the tax penalty for early withdrawals is generally
increased to 25% for withdrawals within the first two years of your
participation in the SIMPLE IRA.
A-PPA-39
<PAGE>
Systemic Withdrawal Program for Substantially Equal Periodic Payments (SEPP)
If you are considering using the Systemic Withdrawal Program for the purpose
of meeting the SEPP exception to the 10% tax penalty, consult with your tax
advisor.
If you receive systematic payments that you intend to qualify for the SEPP
exception, any modifications to your payment before age 59 1/2 or within five
years after beginning Systematic Withdrawal Program payments will result in
the retroactive imposition of the 10% penalty.
Minimum Distribution Requirements
As the table shows, under some contracts, generally you must begin receiving
withdrawals by April 1 of the calendar year following the year in which you
reach age 70 1/2.
________________________________________________________________________________
You may combine the money required to be withdrawn from each of your
Traditional IRAs and withdraw this amount from any one or more of them.
________________________________________________________________________________
A tax penalty of 50% applies to withdrawals which should have been taken but
were not. Complex rules apply to the timing and calculation of these
withdrawals.
Type of Contract
--------------------------------
Non Trad. Roth Simple
Qualified IRA IRA IRA SEP
----- --- --- --- ---
70 1/2 Minimum
distribution no yes no yes yes
rules apply
Non-Qualified Annuities
o Contributions to Non-Qualified annuities are on an "after-tax" basis, so you
only pay income taxes on your earnings. Generally, these earnings are taxed
when you receive them from the contract.
________________________________________________________________________________
After-tax means that your purchase payments to your annuity do not reduce your
taxable income or give you a tax deduction.
________________________________________________________________________________
o Your Non-Qualified annuity may be exchanged for another Non-Qualified
annuity without paying income taxes if certain Code requirements are met.
o When a non-natural person owns a Non-Qualified annuity the annuity will
generally not be treated as an annuity for tax purposes and thus loses the
benefit of tax deferral. Corporations and certain other entities are
generally considered non-natural persons. However, an annuity owned by a
non-natural person as agent for an individual will be treated as an annuity
for tax purposes.
o Annuities issued after October 21, 1988 by the same insurance company in the
same year are combined for tax purposes. As a result, a greater
A-PPA-40
<PAGE>
portion of your withdrawals may be considered taxable income than you would
otherwise expect.
Contributions
Although the Code does not limit the amount of your purchase payments, your
contract may limit them.
Withdrawals
Generally, when you make a withdrawal from your non-qualified annuity, the
Code treats such a withdrawal as:
o First coming from earnings (and thus subject to income tax); and
o Then from your purchase payments (which are not subject to income tax).
o This rule does not apply to payments made pursuant to an income pay-out
option under your contract
Different tax rules apply to payments made pursuant to an income annuity
pay-out option under your contract. They are subject to an "exclusion ratio"
which determines how much of each payment is treated as:
o A non-taxable return of your contributions; and
o A taxable payment of earnings.
If you choose an income annuity payout option we generally will tell you how
much of each income payment is a non-taxable return of contributions.
Generally once the total amount treated as a non-taxable return of your
purchase payments equals your purchase payments, then all remaining income
payments are fully taxable.
Under the Code, withdrawals from Non-Qualified annuities need not be made by a
particular age. However, it is possible that the Internal Revenue Service may
determine that you must take a lump sum withdrawal or elect to receive income
payments by a certain age (e.g., 85).
After Death
If you die before payments under an income annuity begin, we must make payment
of your entire interest in the contract within five years of your death or
begin payments under an income annuity allowed by the Code to your beneficiary
within one year of your death.
________________________________________________________________________________
If you die during the accumulation phase of a Deferred Annuity and your spouse
is your beneficiary or a co-owner he or she may elect to continue as "owner"
of the contract .
________________________________________________________________________________
If you die after income payments begin, payments must continue to be made at
least as rapidly as before your death in accordance with the income type
selected.
If you die before all purchase payments are returned, the unreturned amount
may be deductible on your final income tax return or excluded from income by
your beneficiary if income payments continue after your death.
A-PPA-41
<PAGE>
Individual Retirement Annuities
[Traditional IRA, Roth IRA, SIMPLE IRAs and SEPs]
Generally, except for Roth IRAs, IRAs can accept deductible (or pre-tax)
contributions. Deductible or pre-tax purchase payments will be taxed when
distributed from the contract.
________________________________________________________________________________
Your total contributions to all your Traditional and Roth IRAs may not exceed
the lesser of $2,000 or 100% of your compensation.
________________________________________________________________________________
o Your annuity is generally not forfeitable (e.g. not subject to claims of
your creditors) and you may not transfer it to someone else.
o You can transfer your IRA proceeds to a similar IRA, (or a SIMPLE IRA to a
Traditional IRA after two years), without incurring Federal income taxes if
certain conditions are satisfied.
Traditional IRA Annuities
Contributions
Generally:
________________________________________________________________________________
In some cases, your purchase payments may be tax deductible.
________________________________________________________________________________
o Contributions to Traditional IRAs are limited to the lesser of 100% of
compensation or $2,000 per year. A $2,000 contribution can also be made for
a non-working spouse provided the couple's compensation is at least equal to
their aggregate contributions.
o Contributions in excess of this amount may be subject to a penalty tax.
o Contributions are generally permitted up to age 70 1/2.
o These age and dollar limits do not apply to tax-free rollovers or transfers.
o If certain conditions are met, you can change your Traditional IRA
contribution to a Roth IRA before you file your income tax return (including
filing extensions).
Withdrawals
Withdrawals are included in income except for the portion that represents a
return of non-deductible purchase payments. This portion is determined based
on a ratio of all non-deductible contributions to the total values of all your
IRAs.
After Death
Generally, if you die before required minimum distribution withdrawals have
begun we must make payment of your entire interest within five years after the
year of your death or begin income payments under an income annuity allowed by
the Code to your beneficiary by December 31st of the year after your death.
________________________________________________________________________________
If your spouse is your beneficiary and if your contract permits, he or she may
elect to continue as "owner" of the contract.
________________________________________________________________________________
If your spouse is your beneficiary, and, if your contract permits, your spouse
may delay the start of income payments until December 31 of the year in which
you would have reached age 70 1/2.
A-PPA-42
<PAGE>
If you die after required withdrawals begin, payments must continue at least
as rapidly as under the distribution method in effect at your death.
Roth IRA Annuities
General
Roth IRAs are different from other IRAs because you have the opportunity to
enjoy tax-free earnings. However, you can only make after-tax contributions to
a Roth IRA.
Contributions
Roth IRA contributions are non-deductible and are limited to the lesser of
100% of compensation or $2,000 per year. You may contribute up to the annual
contribution limit in 1998 if your adjusted gross income does not exceed
$95,000 ($150,000 for married couples filing jointly). Contribution limits are
phased out if your income is between:
________________________________________________________________________________
Annual contributions to your IRAs, including ROTH IRAs, may not exceed the
lesser of $2,000 or 100% of your "compensation" as defined by the Code, except
for "spousal" IRAs.
________________________________________________________________________________
Status Income
---------- -----------
Individual $95,000--$160,000
Married filing jointly $150,000--$160,000
Married filing separately $0--$10,000
o Annual contribution limits do not apply to a rollover from a Roth IRA to
another Roth IRA or a conversion from a Traditional IRA to a Roth IRA.
o You can contribute to a Roth IRA after age 70 1/2.
o If you exceed the contribution limits you may be subject to a tax penalty.
o If certain conditions are met, you can change your Roth IRA contribution to
a Traditional IRA before you file your income return (including filing
extensions).
Withdrawals
Generally withdrawals of earnings from Roth IRAs are free from federal income
tax if they meet the following two requirements:
1) The withdrawal is:
o At least five taxable years after your first contribution to a Roth IRA, and
2) made:
o When you reach age 59 1/2;
o Upon your death or disability; or
o For a qualified first-time home purchase (up to $10,000).
Withdrawals of earnings which do not meet these requirements are taxable and a
10% penalty tax may apply if made before age 59 1/2.
A-PPA-43
<PAGE>
Withdrawals from a Roth IRA are made first from purchase payments and then
from earnings. Generally, you do not pay income tax on withdrawals of purchase
payments. However, withdrawals of taxable converted amounts prior to age 59 1/2
will be subject to the 10% penalty tax (unless you meet an exception) if made
within 5 taxable years of such conversion.
In addition, if you withdraw converted money in 1998, 1999 or 2000 which
received the special four year income inclusion treatment discussed later, the
withdrawal will be included in income in the year of the withdrawal (in
addition to the amounts to be included under the four year income inclusion
election). The total aggregate amount to be included in income shall not
exceed the total taxable amount of the conversion.
The order in which money is withdrawn from a Roth IRA is as follows:
(All Roth IRAs owned by a taxpayer are combined for withdrawal purposes.)
o The first money withdrawn is any annual (non-conversion/rollover)
contributions to the Roth IRA. These are received tax and penalty free.
o The next money withdrawn is from conversion/rollover contributions from a
non-Roth IRA, on a first-in, first-out basis. For these purposes,
distributions are treated as coming first from the taxable portion of the
conversion/rollover contribution. As previously discussed, depending upon
when it occurs, withdrawals of taxable converted amounts may be subject to a
penalty tax, or result in the acceleration of inclusion of income.
o The next money withdrawn is from earnings in the Roth IRA. This is received
tax-free if it meets the requirements previously discussed, otherwise it is
subject to federal income tax and an additonal 10% penalty tax may apply if
you are under age 59 1/2.
Conversion
You may convert/rollover an existing IRA to a Roth IRA if your adjusted gross
income does not exceed $100,000 in the year you convert.
________________________________________________________________________________
If you are married but file separately, you may not convert an existing IRA
into a Roth IRA.
________________________________________________________________________________
Except to the extent you have non-deductible IRA contributions, the amount
converted from an existing IRA into a Roth IRA is taxable. Generally, the 10%
early withdrawal penalty does not apply to conversions/rollovers. (See
exception discussed previously.) For conversions in 1998, you may elect to
include the taxable amount in income over a four year period beginning in
1998.
If you mistakenly convert or otherwise wish to change your Roth IRA
contribution to a Traditional IRA contribution, the tax law now allows you to
reverse your conversion provided you do so before you file your tax return for
the year of the contribution and if certain conditions are met.
A-PPA-44
<PAGE>
After Death
Generally, when you die we must make payment of your entire interest within
five years after the year of your death or begin income payments under an
income annuity allowed by the Code to your beneficiary by December 31st of the
year after your death.
If your spouse is your beneficiary and if your contract permits, he or she may
elect to continue as "owner" of the contract.
SIMPLE IRA Deferred Annuities
If your employer has no more than 100 employees (who each earn at least
$5,000) and the SIMPLE IRA is the exclusive tax-qualified plan of the
employer, you as an employee may annually contribute on a before-tax basis up
to $6,000 of your salary (subject to indexing); your employer generally must
match your contributions dollar-for-dollar up to 3% of your compensation.
Under certain circumstances, the employer can elect to contribute less or make
a contribution equal to 2% of compensation for all eligible employees.
SIMPLE IRAs are exempt from complex nondiscrimination, top-heavy and reporting
rules. Once your employer makes a matching contribution, you (not the
employer) have all rights to it. Once contributions are made under these
SIMPLE IRA rules, your SIMPLE IRA generally operates like a Traditional IRA.
However, the tax penalty for early withdrawals is generally increased for
withdrawals within the first two years of your participation in the SIMPLE
IRA. Read the Traditional IRA section for other applicable rules.
SEP IRA Deferred Annuities
Partners and sole proprietors may make purchase payments under SEPs for
themselves and their employees, and corporations may make purchase payments
under SEPs for their employees. Complex rules apply as to which employees or
other persons must be allowed to participate, and what contributions may be
made for each of them.
Once a contribution is made, you (not the employer) have all rights to it.
Once SEP contributions are made, your SEP generally operates like a
Traditional IRA. After December 31, 1996, an employer is not permitted to
establish a salary reduction SEP plan (SARSEP). However, you may contribute,
in accordance with your plan's provisions, to a SARSEP established before
January 1, 1997. Read the Traditional IRA section for other applicable rules.
A-PPA-45
<PAGE>
Table of Contents for the Statement of Additional Information
Page
----
Cover Page ................................................................ 1
Table of Contents ......................................................... 1
Independent Auditors ...................................................... 2
Services .................................................................. 2
Year 2000 ................................................................. 2
Distribution of Certificates and Interests in the
Deferred Annuities and Income Annuities ............................. 2
Experience Factor ......................................................... 2
Early Withdrawal Charge ................................................... 2
Variable Income Payments .................................................. 2
Investment Management Fees ................................................ 5
Performance Data and Advertisement of
the Separate Account ................................................ 6
Voting Rights ............................................................. 7
ERISA ..................................................................... 8
Taxes ..................................................................... 9
Performance Data ..........................................................22
Financial Statements of the Separate Account ................................
Financial Statements of MetLife .............................................
A-PPA-46
<PAGE>
Appendix
Annuity Tax Table
If you are a resident of one of the following jurisdictions, the percentage
amount listed by that jurisdiction is the annuity tax rate which will be
applied to your Deferred Annuity or Income Annuity.
Non-Qualified
and Roth IRA
Deferred Traditional
Annuities IRA, SIMPLE IRA and
and Income SEP Deferred Annuities and
Annuities Income Annuities(1)
California ............ 2.35% 0.5%(2)
Kentucky(3) ........... 2.0% 2.0%
Maine ................. 2.0% --
Nevada ................ 3.5% --
Puerto Rico ........... 1.0% 1.0%
South Dakota .......... 1.25% --
U.S. Virgin Islands ... 5.0% 5.0%
West Virginia ......... 1.0% 1.0%
Wyoming ............... 1.0% --
_____________________
(1) Annuity tax rates applicable to Traditional IRA, SIMPLE IRA and SEP
Deferred Annuities and Income Annuities purchased for use in connection
with individual retirement trust or custodial accounts meeting the
requirements of Section 408(a) of the Code are included under the column
heading "Traditional IRA, SIMPLE IRA and SEP Deferred Annuities and Income
Annuities."
(2) With respect to Deferred Annuities and Income Annuities purchased for use
in connection with individual retirement trust or custodial accounts
meeting the requirements of Section 408(a) of the Code, the annuity tax
rate in California is 2.35% instead of 0.5%.
(3) The annuity tax in Kentucky is repealed effective January 1, 2000.
PEANUTS (Copyright) United Feature Syndicate, Inc.
(Copyright) 1999 Metropolitan Life Insurance Company
A-PPA-47
<PAGE>
[LOGO OF METROPOLITAN
LIFE INSURANCE COMPANY]
Metropolitan Life Insurance Company [INDICIA]
Johnstown Office, 500 Schoolhouse Road
Johnstown, PA 15904-2914
Address Service Requested
<PAGE>
April 30, 1999
Preference Plus(Registered) Account Variable Annuity Contracts
Issued by Metropolitan Life Insurance Company
This Prospectus describes individual and group Preference Plus contracts for
deferred variable annuities ("Deferred Annuities") and Preference Plus
immediate variable income annuities ("Income Annuities").
You decide how to allocate your money among the various available investment
choices. The investment choices available to you are listed in the contract
for your Deferred Annuity or Income Annuity. Your choices may include the
Fixed Interest Account (not described in this Prospectus) and investment
divisions available through Metropolitan Life Separate Account E which, in
turn, invest in the following corresponding portfolios of the Metropolitan
Series Fund, Inc. ("Metropolitan Fund") and a portfolio of the Calvert
Variable Series, Inc. ("Calvert Fund"):
State Street Research Aggressive Growth
State Street Research Diversified
State Street Research Growth
State Street Research Income
Harris Oakmark Large Cap Value
Janus Mid Cap
Loomis Sayles High Yield Bond
Neuberger&Berman Partners Mid Cap Value
Santander International Stock
Scudder Global Equity
T. Rowe Price Large Cap Growth
T. Rowe Price Small Cap Growth
Lehman Brothers Aggregate Bond Index
MetLife Stock Index
Morgan Stanley EAFE Index
Russell 2000 Index
Calvert Social Balanced
How to learn more:
Before investing, read the information in this Prospectus about the Deferred
Annuities, Income Annuities and Metropolitan Life Separate Account E. Keep
this Prospectus for future reference. For more information, request a copy of
the Statement of Additional Information ("SAI"), dated April 30, 1999. The SAI
is considered part of this Prospectus as though it were included in the
Prospectus. The Table of Contents of the SAI appears on page B-PPA-46 of this
Prospectus. To request a free copy of the SAI or to ask questions, write or
call:
Metropolitan Life Insurance Company
Retirement & Savings Center, Area 2H
One Madison Avenue
New York, NY 10010-3690
Attention: Alan DeMichele
Phone: (800) 553-4459
The Securities and Exchange Commission has a website (http://www.sec.gov)
which you may visit to view this Prospectus, SAI and other information. The
Securities and Exchange Commission has not approved or disapproved these
securities or determined if this Prospectus is truthful or complete. Any
representation otherwise is a criminal offense.
The current Metropolitan Fund prospectus and, if applicable, the Calvert Fund
prospectus are attached to the back of this prospectus. You should also read
these prospectuses carefully before purchasing a Deferred Annuity or Income
Annuity. This Prospectus is not valid unless attached to Metropolitan Fund
and, if applicable, Calvert Fund prospectuses.
Deferred Annuities Available
for Purchase:
o TSA
o PEDC
o Keogh
o 403(a)
Income Annuities Available:
o TSA
o PEDC
o Keogh
o 403(a)
A word about investment risk:
An investment in any of these variable annuities involves investment risk. You
could lose money you invest. Money invested is NOT:
o a bank deposit or obligation;
o federally insured or guaranteed; or
o endorsed by any bank or other financial institution.
[LOGO OF METROPOLITAN LIFE INSURANCE COMPANY]
<PAGE>
TABLE OF CONTENTS
Important Terms You Should Know ........................... B-PPA-4
Table of Expenses ......................................... B-PPA-6
Accumulation Unit Values Table ............................ B-PPA-9
MetLife ................................................... B-PPA-13
Metropolitan Life Separate Account E ...................... B-PPA-13
The Variable Annuities in this Prospectus ................. B-PPA-14
A Deferred Annuity ................................... B-PPA-14
An Income Annuity .................................... B-PPA-14
Your Investment Choices ................................... B-PPA-15
Deferred Annuities ........................................ B-PPA-16
The Deferred Annuity and Your Retirement Plan ........ B-PPA-17
Automated Investment Strategies ...................... B-PPA-17
Purchase Payments .................................... B-PPA-18
Allocation of Purchase Payments .................... B-PPA-18
Limits on Purchase Payments ........................ B-PPA-19
The Value of Your Investment ......................... B-PPA-19
Transfers ............................................ B-PPA-20
Access to Your Money ................................. B-PPA-21
Systematic Withdrawal Program for TSA
Deferred Annuities ................................. B-PPA-21
Minimum Distribution ............................... B-PPA-22
Contract Fee ......................................... B-PPA-23
Charges .............................................. B-PPA-23
Insurance-Related Charge ........................... B-PPA-23
Investment-Related Charge .......................... B-PPA-24
Annuity Taxes ........................................ B-PPA-24
Early Withdrawal Charges ............................. B-PPA-24
When No Early Withdrawal Charge Applies ............ B-PPA-25
When Another Early Withdrawal Charge May Apply ..... B-PPA-27
Free Look ............................................ B-PPA-28
Death Benefit ........................................ B-PPA-29
Pay-out Options (or Income Options) .................. B-PPA-29
Income Annuities .......................................... B-PPA-30
Income Payment Types ................................. B-PPA-31
B-PPA-2
<PAGE>
Purchasing an Income Annuity .............................. B-PPA-32
Allocation of Your Purchase Payment ....................... B-PPA-32
The Value of Your Income Payments ......................... B-PPA-32
Transfers ................................................. B-PPA-33
Contract Fee .............................................. B-PPA-33
Charges ................................................... B-PPA-34
Insurance-Related Charge ................................ B-PPA-34
Investment-Related Charge ............................... B-PPA-34
Annuity Taxes ............................................. B-PPA-34
Free Look ................................................. B-PPA-34
General Information ............................................ B-PPA-35
Administration ............................................ B-PPA-35
Purchase Payments ....................................... B-PPA-35
Confirming Transactions ................................. B-PPA-35
Transactions by Telephone ............................... B-PPA-36
Processing of Certain Transactions ...................... B-PPA-36
Valuation ............................................... B-PPA-36
Advertising Performance ................................... B-PPA-37
Changes to Your Deferred Annuity or Income Annuity ........ B-PPA-38
Voting Rights ............................................. B-PPA-38
Who Sells the Deferred Annuities and Income Annuities ..... B-PPA-39
Financial Statements ...................................... B-PPA-40
Your Spouse's Rights ...................................... B-PPA-40
When We Can Cancel Your Deferred Annuity or
Income Annuity ............................................ B-PPA-40
Income Taxes ................................................... B-PPA-41
Table of Contents of the Statement of Additional
Information .................................................... B-PPA-46
Appendix for Annuity Tax Table ................................. B-PPA-47
Appendix II for Texas Optional Retirement Program .............. B-PPA-48
MetLife does not intend to offer the Deferred Annuities or Income Annuities
anywhere they may not lawfully be offered and sold. MetLife has not authorized
any information or representations about the Deferred Annuities or Income
Annuities other than the information in this Prospectus, any attached
prospectus or supplements to the prospectuses or any supplemental sales
material we authorize.
B-PPA-3
<PAGE>
Important Terms You Should Know
Account Balance
When you purchase a Deferred Annuity an account is set up for you. Your
Account Balance is the total amount of money credited to you under your
Deferred Annuity including money in the investment divisions of the Separate
Account and the Fixed Interest Account.
Accumulation Unit Value
Under a Deferred Annuity, money paid-in or transferred into an investment
division of the Separate Account is credited to you in the form of
accumulation units. Accumulation units are established for each investment
division. We determine the value of these accumulation units each day the New
York Stock Exchange is open for regular trading. The values increase or
decrease based on the investment performance of the corresponding underlying
portfolios.
Annuity Unit Value
Under an Income Annuity or variable payout option, the money paid-in or
transferred into an investment division of the Separate Account is held in the
form of annuity units. Annuity units are established for each investment
division. We determine the value of these annuity units each day the New York
Stock Exchange is open for regular trading. The values increase or decrease
based on the investment performance of the corresponding underlying
portfolios.
Assumed Investment Return (AIR)
Under an income annuity, the AIR is a percentage rate of return assumed to
determine the amount of the first variable income payment. The AIR is also the
benchmark that is used to calculate the investment performance of a given
investment division to determine all subsequent payments to you.
Contract
A contract is the legal agreement between you and MetLife or the certificate
under a group annuity contract between MetLife and your employer, plan trustee
or other entity. You as the participant or annuitant receive a certificate
under the contract. The contract contains relevant provisions of your Deferred
Annuity or Income Annuity. MetLife issues contracts for each of the annuities
described in this Prospectus.
Contract Year
Generally, the Contract Year for a Deferred Annuity is the period ending on
the last day of the month in which the anniversary of when we issue the
annuity occurs and each following 12 month period. However, depending on
underwriting and plan requirements, the first Contract Year may range from the
initial three to 15 months after the Deferred Annuity is issued.
B-PPA-4
<PAGE>
Early Withdrawal Charge
The early withdrawal charge is the amount we deduct from your Account Balance
in addition to your requested withdrawal amount, if you withdraw money
prematurely from a Deferred Annuity. This charge is often referred to as a
deferred sales load or back-end load.
Investment Division
Investment divisions are subdivisions of the Separate Account. When you
allocate or transfer money to an investment division, the investment division
purchases shares of a portfolio (with the same name) within the Metropolitan
Fund or Calvert Fund.
MetLife
Metropolitan Life Insurance Company is the company that issues the
Deferred Annuities and Income Annuities. Throughout this Prospectus, MetLife
is also referred to as "we," "us" or "our."
MetLife Designated Office
The MetLife Designated Office is the MetLife office that will generally handle
the processing of all your requests concerning your Deferred Annuity or Income
Annuity. MetLife will notify you and provide you with the address of your
MetLife Designated Office.
Separate Account
A separate account is an investment account. All assets contributed to
investment divisions under the Deferred Annuities and Income Annuities are
pooled in the Separate Account and maintained for the benefit of investors in
Deferred Annuities and Income Annuities.
You
In this Prospectus, depending on the context, "you" may mean either the
purchaser of the Deferred Annuity or Income Annuity, or, the participant or
annuitant for whom money is invested under certain group arrangements. In cases
where we are referring to giving instructions or making payments to us for PEDC
contracts, "you" means the employer or trustee. For Keogh contracts, "you" means
the trustee of the Keogh plan. Under PEDC or Keogh plans where the participant
or annuitant is allowed to choose among investment choices, "you" means the
participant or annuitant where it refers to giving instructions among the
investment choices.
Variable Annuity
An annuity in which returns/income payments are based upon the performance of
investments such as stocks and bonds held by one or more underlying
portfolios. You assume the investment risk for any amounts allocated to the
investment divisions in a variable annuity.
B-PPA-5
<PAGE>
TABLE OF EXPENSES--PREFERENCE PLUS DEFERRED ANNUITIES AND INCOME ANNUITIES
The following table shows the Separate Account, Metropolitan Fund and Calvert
Fund charges and expenses you will incur. The table is based on past
experience and is subject to change. It is not intended to show your actual
expenses which may be higher or lower. The table does not show fees for the
Fixed Interest Account or the impact of annuity taxes. We have provided
examples to show you the impact of Separate Account, Metropolitan Fund and
Calvert Fund charges and expenses on a hypothetical investment of $1,000 that
has an assumed 5% return on the investment.
- --------------------------------------------------------------------------------
Separate Account, Metropolitan Fund and Calvert Fund expenses
for the fiscal year ending December 31, 1998:
Contractowner Transaction Expenses For All Investment Divisions
Currently Offered
Sales Load Imposed on Purchases ............................... None
Deferred Sales Load (as a percentage of the purchase payment
funding the withdrawal during the accumulation period) (1) ... From 0% to 7%
Exchange Fee .............................................. None
Surrender Fee ............................................. None
Annual Contract Fee (2) ......................................... None
Separate Account Annual Expenses (as a percentage of average
account value) (3)
General Administrative Expenses Charge ..................... .50%
Mortality and Expense Risk Charge .......................... .75%
Total Separate Account Annual Expenses ..................... 1.25%
OTHER EXPENSES
Metropolitan Fund Annual Expenses MANAGEMENT AFTER EXPENSE
(as a percentage of average net assets) FEES REIMBURSEMENT TOTAL
- --------------------------------------------------------------------------------
State Street Research Aggressive Growth
Portfolio (4)(5) .............................
State Street Research Diversified
Portfolio (4)(5) .............................
State Street Research Growth Portfolio (4)(5)..
State Street Research Income Portfolio (4)(5)..
Harris Oakmark Large Cap Value
Portfolio (5)(7) .............................
Janus Mid Cap Portfolio (5)(6) ................
Loomis Sayles High Yield Bond Portfolio (6) ...
Neuberger&Berman Partners Mid Cap Value
Portfolio (5)(7) .............................
Santander International Stock
Portfolio (4)(5) .............................
Scudder Global Equity Portfolio (5)(6) ........
T. Rowe Price Large Cap Growth
Portfolio (5)(7) .............................
T. Rowe Price Small Cap Growth
Portfolio (5)(6) .............................
Lehman Brothers Aggregate Bond Index
Portfolio (7) ................................
MetLife Stock Index Portfolio (4) .............
Morgan Stanley EAFE(Registered) Index
Portfolio (7) ................................
Russell 2000 Index Portfolio (7) ..............
Calvert Fund Annual Expenses (as a percentage
of average net assets)
- -----------------------------------------------
Calvert Social Balanced Portfolio (8) .........
B-PPA-6
<PAGE>
Example
If you surrender your Deferred Annuity (withdraw all your money) at the end of
the time periods listed below, you would pay the following expenses on a $1,000
investment in each investment division listed below, assuming a 5% annual return
on assets:
<TABLE>
<CAPTION>
1 3 5 10
YEAR YEARS YEARS YEARS
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
State Street Research Aggressive Growth Portfolio ..
State Street Research Diversified Portfolio ........
State Street Research Growth Portfolio .............
State Street Research Income Portfolio .............
Calvert Social Balanced Portfolio ..................
Harris Oakmark Large Cap Value Portfolio ...........
Janus Mid Cap Portfolio ............................
Loomis Sayles High Yield Bond Portfolio ............
Neuberger&Berman Partners Mid Cap Value Portfolio ..
Santander International Stock Portfolio ............
Scudder Global Equity Portfolio ....................
T. Rowe Price Large Cap Growth Portfolio ...........
T. Rowe Price Small Cap Growth Portfolio ...........
Lehman Brothers Aggregate Bond Index Portfolio .....
MetLife Stock Index Portfolio ......................
Morgan Stanley EAFE(Registered) Index Portfolio ....
Russell 2000 Index Portfolio .......................
</TABLE>
If you annuitize (elect a pay-out option under your Deferred Annuity) or do not
surrender your Deferred Annuity at the end of the time periods listed below, you
would pay the following expenses on a $1,000 investment in each investment
division listed below, assuming a 5% annual return on assets (9):
<TABLE>
<CAPTION>
1 3 5 10
YEAR YEARS YEARS YEARS
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
State Street Research Aggressive Growth Portfolio ..
State Street Research Diversified Portfolio ........
State Street Research Growth Portfolio .............
State Street Research Income Portfolio .............
Calvert Social Balanced Portfolio ..................
Harris Oakmark Large Cap Value Portfolio ...........
Janus Mid Cap Portfolio ............................
Loomis Sayles High Yield Bond Portfolio ............
Neuberger&Berman Partners Mid Cap Value Portfolio ..
Santander International Stock Portfolio ............
Scudder Global Equity Portfolio ....................
T. Rowe Price Large Cap Growth Portfolio ...........
T. Rowe Price Small Cap Growth Portfolio ...........
Lehman Brothers Aggregate Bond Index Portfolio .....
MetLife Stock Index Portfolio ......................
Morgan Stanley EAFE(Registered) Index Portfolio ....
Russell 2000 Index Portfolio .......................
</TABLE>
B-PPA-7
<PAGE>
TABLE OF EXPENSES (continued)
(1) There are times when the early withdrawal charge does not apply to amounts
that are withdrawn from a Deferred Annuity. Each Contract Year you may take
the greater of 10% (20% under certain Deferred Annuities) of your Account
Balance or your purchase payments made over 7 years ago free of early
withdrawal charges.
(2) A $20 annual contract fee is imposed on money in the Fixed Interest
Account. This fee may be waived under certain circumstances. There is a one
time contract fee of $350 for Income Annuities. We do not charge this fee
if you elect a pay-out option under your Deferred Annuity and you have
owned your Deferred Annuity more than two years.
(3) Our total Separate Account Annual Expenses will not exceed 1.25% of your
average balance in the investment divisions. For purposes of presentation
here, we estimated the allocation between general administrative expenses
and the mortality and expense risk charge.
(4) Prior to May 16, 1993, we paid all expenses of the Metropolitan Fund (other
than management fees, brokerage commissions, taxes, interest and
extraordinary or non-recurring expenses).
(5) We anticipate that the marginal rate of the investment management fee for
the Portfolio will decrease when the size of the Portfolio reaches certain
pre-established dollar levels.
(6) These Portfolios began operations on March 3, 1997. We paid all expenses
(other than management fees, brokerage commissions, taxes, interest and
extraordinary or non-recurring expenses) in excess of .20% of the average
net assets for each of the following Portfolios until the Portfolio's total
assets reached $100 million, or until March 2, 1999, whichever came first:
OTHER EXPENSES DATE
WITHOUT REIMBURSEMENT
REIMBURSEMENT STOPPED
-------------------------------------------------------------------------
Loomis Sayles High Yield Bond
T. Rowe Price Small Cap Growth January 23, 1998
Janus Mid Cap December 31, 1997
Scudder Global Equity July 1, 1998
If we had not reimbursed the Portfolios for these expenses, the "other
expenses" for the Portfolios would have been those listed above.
(7) These Portfolios began operations on November 9, 1998. We pay all expenses
(other than management fees, brokerage commissions, taxes, interest and
extraordinary or non-recurring expenses) in excess of .20% (.25% for the
Morgan Stanley EAFE(R) Index Portfolio) of the average net assets for each
of the following Portfolios until the Portfolio's total assets reach $100
million, or until November 8, 2000, whichever comes first:
OTHER EXPENSES
WITHOUT
REIMBURSEMENT
--------------------------------------------------------------
Harris Oakmark Large Cap Value
Lehman Brothers Aggregate Bond Index
Neuberger&Berman Partners Mid Cap Value
Russell 2000 Index
T. Rowe Price Large Cap Growth Portfolio
Morgan Stanley EAFE(Registered) Index
If we had not reimbursed the Portfolios for these expenses, the "other
expenses" for the Portfolios would have been those listed above.
(8) Calvert Social Balanced Portfolio's management fees may go up or down
based on the Portfolio's performance. The management fees may range from
.85% to .55%. In addition, the numbers shown in the table reflect an
increase of .01% which is attributed to an increase in transfer agency
expenses. Part of the Portfolio's other expenses are paid by a third
party. If some of the Portfolio's other expenses have not been
reimbursed its other expenses would have been __%.
(9) The income option you choose when you decide to exercise a pay-out
option under your Deferred Annuity must be a life annuity or have
scheduled payments for a period of at least five years to avoid the
early withdrawal charge.
In 1998, the Separate Account annual expenses we received for all Separate
Account annuities was $_______.
B-PPA-8
<PAGE>
ACCUMULATION UNIT VALUES FOR EACH INVESTMENT DIVISION
(For an accumulation unit outstanding throughout the period)
These tables and bar charts show fluctuations in the Accumulation Unit Values
for each investment division from year end to year end, we have included bar
charts. The information in this table has been derived from the Separate
Account's full financial statements or other reports (such as the annual
report). The financial statements are audited annually by Deloitte & Touche LLP,
who are independent auditors. The full financial statements and related notes
appear in the SAI.
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------
NUMBER OF
BEGINNING OF YEAR END OF YEAR ACCUMULATION
ACCUMULATION ACCUMULATION UNITS END OF YEAR
PREFERENCE PLUS DEFERRED ANNUITIES YEAR UNIT VALUE UNIT VALUE (IN THOUSANDS)
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
State Street Research Aggressive Growth Division .. 1998 $25.05
1997 23.77 25.05 43,359
[YEAR END ACCUMULATION UNIT VALUE 1996 22.35 23.77 43,962
BAR CHARTS OMITTED FOR THIS DIVISION 1995 17.47 22.35 33,899
AND EACH OF THE 11 FOLLOWING DIVISIONS] 1994 18.03 17.47 26,890
1993 14.89 18.03 17,094
1992 13.66 14.89 5,747
1991 8.31 13.66 1,060
1990 10.00(a) 8.31 49
State Street Research Diversified Division ........ 1998 22.89
1997 19.22 22.89 62,604
1996 17.00 19.22 52,053
1995 13.55 17.00 42,712
1994 14.15 13.55 40,962
1993 12.70 14.15 31,808
1992 11.75 12.70 7,375
1991 9.52 11.75 1,080
1990 10.00(a) 9.52 44
</TABLE>
B-PPA-9
<PAGE>
ACCUMULATION UNIT VALUES (continued)
(For an accumulation unit outstanding throughout the period)
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------
NUMBER OF
BEGINNING OF YEAR END OF YEAR ACCUMULATION
ACCUMULATION ACCUMULATION UNITS END OF YEAR
PREFERENCE PLUS DEFERRED ANNUITIES YEAR UNIT VALUE UNIT VALUE (IN THOUSANDS)
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
State Street Research Growth Division ............ 1998 $27.10
1997 21.37 27.10 60,102
1996 17.71 21.37 49,644
1995 13.47 17.71 38,047
1994 14.10 13.47 32,563
1993 12.48 14.10 24,608
1992 11.32 12.48 9,432
1991 8.61 11.32 2,824
1990 10.00(a) 8.61 178
State Street Research Income Division ............ 1998 17.89
1997 16.49 17.89 16,307
1996 16.12 16.49 16,604
1995 13.65 16.12 15,252
1994 14.27 13.65 13,923
1993 12.98 14.27 14,631
1992 12.29 12.98 5,918
1991 10.60 12.29 1,210
1990 10.00(a) 10.60 32
Calvert Social Balanced Division ................. 1998 22.16
1997 18.68 22.16 1,181
1996 16.80 18.68 995
1995 13.11 16.80 787
1994 13.71 13.11 630
1993 12.86 13.71 473
1992 12.10 12.86 239
1991 10.58 12.10 63
1990 10.00(b) 10.58 0
</TABLE>
B-PPA-10
<PAGE>
ACCUMULATION UNIT VALUES (continued)
(For an accumulation unit outstanding throughout the period)
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------
NUMBER OF
BEGINNING OF YEAR END OF YEAR ACCUMULATION
ACCUMULATION ACCUMULATION UNITS END OF YEAR
PREFERENCE PLUS DEFERRED ANNUITIES YEAR UNIT VALUE UNIT VALUE (IN THOUSANDS)
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Janus Mid Cap Division ............................ 1998 $12.69
1997 10.00(c) 12.69 7,417
Loomis Sayles High Yield Bond Division ............ 1998 10.51
1997 10.00(c) 10.51 2,375
Santander International Stock Division ............ 1998 13.28
1997 13.77 13.28 15,865
1996 14.19 13.77 17,780
1995 14.25 14.19 17,553
1994 13.74 14.25 16,674
1993 9.41 13.74 6,921
1992 10.61 9.41 966
1991 10.00(d) 10.61 92
Scudder Global Equity Division .................... 1998 10.85
1997 10.00(c) 10.85 4,826
T. Rowe Price Small Cap Growth Division ........... 1998 11.76
1997 10.00(c) 11.76 6,932
</TABLE>
B-PPA-11
<PAGE>
ACCUMULATION UNIT VALUES (continued)
(For an accumulation unit outstanding throughout the period)
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------
NUMBER OF
BEGINNING OF YEAR END OF YEAR ACCUMULATION
ACCUMULATION ACCUMULATION UNITS END OF YEAR
PREFERENCE PLUS DEFERRED ANNUITIES YEAR UNIT VALUE UNIT VALUE (IN THOUSANDS)
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
MetLife Stock Index Division ...................... 1998 $29.28
1997 22.43 29.28 58,817
1996 18.52 22.43 43,141
1995 13.70 18.52 29,883
1994 13.71 13.70 23,458
1993 12.67 13.71 18,202
1992 11.94 12.67 8,150
1991 9.32 11.94 1,666
1990 10.00(a) 9.32 55
Harris Oakmark Large Cap Value Division ........... 1998 10.00(e)
Lehman Brothers Aggregate Bond Division ........... 1998 10.00(e)
Morgan Stanley EAFE(Registered) Index Division .... 1998 10.00(e)
Neuberger&Berman Partners Mid Cap Value Division .. 1998 10.00(e)
Russell 2000 Index Division ....................... 1998 10.00(e)
T. Rowe Price Large Cap Growth Division ........... 1998 10.00(e)
</TABLE>
- -----------
In addition to the above mentioned Accumulation Units, there were cash reserves
of $ as of December 31, 1998, applicable to Income Annuities (including those
not described in this Prospectus) receiving annuity payouts.
(a) Inception Date July 2, 1990.
(b) Inception Date September 17, 1990.
(c) Inception Date March 3, 1997.
(d) Inception Date July 1, 1991.
(e) Inception Date November 9, 1998. A bar chart does not appear for this
Division because there is less than one calendar year of performance
history.
B-PPA-12
<PAGE>
MetLife
Our main office is located at One Madison Avenue, New York, New York 10010.
Headquartered in New York City since 1868, MetLife is one of the world's largest
financial services companies and leader in life insurance sales in the United
States. With approximately $ . billion worth of assets under management as of
December 31, 1998, MetLife serves 37 million people around the world and manages
pension plans of many Fortune 500 companies. The more than 41,000 associates in
the MetLife family provide or administer life, health and property/casualty
insurance, annuities, mutual funds as well as other kinds of savings, retirement
and financial products and services for individuals and groups.
We are a mutual life insurance company. In November 1998, MetLife announced its
intention to convert to a stock company from a mutual company. MetLife's board
of directors authorized the to development of a plan to "demutualize." The plan
will be subject to approval by the board of directors, the State of New York
Insurance Department and policyholders. As of April 30, 1999, we do not know the
details of the plan or when or if it will take effect.
Metropolitan Life Separate Account E
We established Metropolitan Life Separate Account E on September 27, 1983. The
purpose of the Separate Account is to hold the variable assets that underlie the
Preference Plus Account Variable Annuity Contracts and some other variable
annuity contracts we issue. We have registered the Separate Account with the
Securities and Exchange Commission as a unit investment trust under the
Investment Company Act of 1940.
The Separate Account's assets are solely for the benefit of those who invest in
the Separate Account and no one else, including our creditors. We are obligated
to pay all money we owe under the Deferred Annuities and Income Annuities even
if that amount exceeds the assets in the Separate Account. The assets of the
Separate Account are held in our name on behalf of the Separate Account and
legally belong to us. All the income, gains, and losses (realized or unrealized)
resulting from these assets are credited to or charged against the contracts
issued from this Separate Account without regard to our other business.
B-PPA-13
<PAGE>
The Variable Annuities in this Prospectus
There are two types of variable annuities described in this Prospectus: Deferred
Annuities and Income Annuities. These annuities are "variable" because the value
of your account or income payment varies, based on the investment performance of
the investment divisions you choose. In short, the value of your Deferred
Annuity, your income payments under a variable pay-out option of your Deferred
Annuity, or your income payments under your Income Annuity, may go up or down.
Since the investment performance is not guaranteed, your money is at risk. The
degree of risk will depend on the investment divisions you select. The
Accumulation Unit Value or Annuity Unit Value for each investment division rises
or falls based on the investment performance (or "experience") of the Portfolio
with the same name.
The Deferred Annuities have a fixed interest rate option called the Fixed
Interest Account. With the Fixed Interest Account, your money earns a rate of
interest that we guarantee. Income Annuities and the variable pay-out options
under the Deferred Annuities have a fixed payment option called the Fixed Income
Option. Under the Fixed Income Option, we guarantee the amount of your fixed
income payments. These fixed options are not described in this Prospectus
although we occasionally refer to them.
A Deferred Annuity
You accumulate money in your account during the pay-in phase by making one or
more purchase payments. MetLife will hold your money and credit any investment
returns as long as the money remains in your account.
The pay-out phase begins when you either take all of your money out of the
account or elect to have us pay you "income" payments using the money in your
account. The number and the amount of the income payments you receive will
depend on such things as the type pay-out option you choose, your investment
choices, and the amount used to provide your income payments. Because Deferred
Annuities offer various insurance benefits such as pay-out options, including
our guarantee of income for your lifetime, they are "annuities."
An Income Annuity
An Income Annuity, also known as an immediate annuity, only has a "pay-out"
phase. You make a single purchase payment and select the type of pay-out option
suited to your needs. Some of the pay-out options guarantee an income stream for
your lifetime or your and another's lifetimes. Some Income Annuities guarantee a
time period of your choice
_______________________________________________________________________________
Group Deferred Annuities and group Income Annuities are also available. They are
offered to an employer, association, trust or other group for its employees,
members or participants.
A Deferred Annuity consists of two phases: the accumulation or "pay-in" phase
and the income annuity or "pay-out" phase.
_______________________________________________________________________________
B-PPA-14
<PAGE>
over which MetLife will make income payments. Income Annuities also have other
features. The amount of your income payments you receive will depend on such
things as the type of pay-out option you choose, your investment choices and the
amount of your purchase payment.
Your Investment Choices
The investment choices are:
Lehman Brothers Aggregate Bond Index Portfolio
State Street Research Income Portfolio
State Street Research Diversified Portfolio
Calvert Social Balanced Portfolio
MetLife Stock Index Portfolio
Harris Oakmark Large Cap Value Portfolio
T. Rowe Price Large Cap Growth Portfolio
State Street Research Growth Portfolio
Neuberger & Berman Partners Mid Cap Value Portfolio
Janus Mid Cap Portfolio
Loomis Sayles High Yield Bond Portfolio
State Street Research Aggressive Growth Portfolio
Russell 2000 Index Portfolio
T. Rowe Price Small Cap Growth Portfolio
Scudder Global Equity Portfolio
Morgan Stanley EAFE(Registered) Index Portfolio
Santander International Stock Portfolio
Some of the investment choices may not be available under the terms of the
Deferred Annuity or Income Annuity. The contract will indicate the investment
divisions that are available to you. Your investment choices may be limited
because:
o Some of the investment divisions are not approved in your state.
o Your employer, association or other group contractholder limits the number of
available investment divisions.
o We have restricted the available investment divisions.
o For Income Annuities, some states limit you to four choices (four
investment divisions or three investment divisions and the Fixed Income
Option).
The investment divisions buy and sell shares of corresponding mutual fund
portfolios. These Portfolios, which are either part of the Metropolitan Fund or
the Calvert Fund, invest in stocks, bonds and other investments. All dividends
declared by the Portfolios are earned by the Separate Account and reinvested.
________________________________________________________________________________
The degree of investment risk you assume will depend on the investment divisions
you choose. We have listed your choices in order of risk from the most
conservative to the most aggressive.
While the investment divisions and their comparably named Portfolios may have
names, investment objectives and management which are identical or similar to
publicly available mutual funds, these are not those mutual funds. The
Portfolios most likely will not have the same performance experience as any
publicly available mutual fund.
________________________________________________________________________________
B-PPA-15
<PAGE>
Therefore, no dividends are distributed to you under the Deferred Annuities or
Income Annuities. Dividends generally are reflected in an increase in the
Accumulation or Annuity Unit Value. You pay no transaction expenses (i.e., front
end or back-end load sales charges) as a result of the Separate Account's
purchase or sale of these mutual fund shares. The Portfolios of the Metropolitan
Fund are available only by purchasing MetLife annuities and life insurance
policies and are never sold directly to the public. The Calvert Social Balanced
Portfolio is made available by the Calvert Fund only through various insurance
company annuities and life insurance policies.
The Metropolitan Fund and the Calvert Fund are each a "series" type fund
registered with the Securities and Exchange Commission as an "open-end
management investment company" under the Investment Company Act of 1940 (the
"1940 Act"). A "series" fund means that each Portfolio is one of several
available through the fund. Except for the Janus Mid Cap and the Calvert Social
Balanced Portfolios, each Portfolio is "diversified" under the 1940 Act.
The Metropolitan Fund, the Calvert Fund and each of their Portfolios are more
fully described in their respective prospectuses and SAIs. The Metropolitan Fund
prospectus is attached at the end of this Prospectus. If Calvert Social Balanced
Portfolio is available to you, then you will also receive a Calvert Fund
prospectus. The SAI for each fund is available upon your request.
The Portfolios of the Metropolitan Fund pay us a monthly fee for our services as
investment manager. The Calvert Social Balanced Portfolio pays Calvert Asset
Management Company, Inc. a monthly fee as its investment manager. These fees, as
well as the operating expenses paid by each Portfolio, are described as
applicable in the Metropolitan Fund and the Calvert Fund prospectuses and SAIs.
In addition, the Metropolitan Fund prospectus discusses other separate accounts
of MetLife and Metropolitan Tower Life Insurance Company that invest in the
Metropolitan Fund. The Calvert Fund prospectus discusses different separate
accounts of the various insurance companies that invest in the portfolios of the
Calvert Fund. The risks of these arrangements are also discussed in each fund's
prospectus.
Deferred Annuities
This Prospectus describes four kinds of Deferred Annuities under which you can
accumulate money:
o TSA (Tax Sheltered Annuity)
o PEDC (Public Employee Deferred Compensation)
o Keogh (Keogh plans under Section 401)
o 403(a) (Qualified Annuity plans under Section 403(a))
________________________________________________________________________________
There is a possibility you will lose principal in the investment choices.
However, they generally offer the opportunity for greater returns over the long
term than our guaranteed fixed options.
________________________________________________________________________________
B-PPA-16
<PAGE>
Certain group Deferred Annuities may be issued to a bank that does nothing but
hold them as contractholder. Deferred Annuities may be either:
o Allocated (your Account Balance records are kept for you as an individual); or
o Unallocated (Account Balance records are kept for a plan or group as a
whole).
The Deferred Annuity and Your Retirement Plan
If you participate through a retirement plan, the Deferred Annuity may provide
that all or some of your rights as described in this Prospectus are subject to
the plan's terms. Limitations on your rights may apply to investment choices,
automated investment strategies, purchase payments, withdrawals, transfers, the
death benefit and pay-out options. The Deferred Annuity may provide that a plan
administrative fee will be paid by making a withdrawal from your Account
Balance. We may rely on your employer's or plan administrator's statements to us
as to the terms of the plan or your entitlement to any amounts. We will not be
responsible for determining what your plan says. You should consult the Deferred
Annuity contract and plan document to see how you may be affected. If you are a
Texas Operational Retirement Program participant, please see Appendix II for
specific information which applies to you.
Automated Investment Strategies
There are five automated investment strategies available to you. However, the
investment strategies are not available to Keogh Deferred Annuities or other
unallocated contracts. As with any investment program, no strategy can guarantee
a gain - you can lose money. We may modify or terminate any of the strategies at
any time. You may have only one automated investment strategy in effect at a
time.
The Equity Generator(Service Mark): An amount equal to the interest earned in
the Fixed Interest Account is transferred monthly to either the MetLife Stock
Index or State Street Research Aggressive Growth investment division, based on
your selection.
If you elect the Equity Generator at the time you purchase your Deferred Annuity
and you never request allocation changes or transfers, when you withdraw money
the early withdrawal charge will not exceed any earnings under the Deferred
Annuity.
The Equalizer(Service Mark): Each quarter amounts are transferred between the
Fixed Interest Account and, based on your selection, either the MetLife Stock
Index or State Street Research Aggressive Growth investment division to make the
value of each equal.
________________________________________________________________________________
These Deferred Annuities may be either issued to you as an individual or to a
group (you are then a participant under the group's Deferred Annuity).
We created these investment strategies to help you manage your money. You decide
if one is appropriate for you, based upon your risk tolerance and saving goals.
These strategies were designed to help you take advantage of the tax-deferred
status of an annuity.
________________________________________________________________________________
B-PPA-17
<PAGE>
The Rebalancer(Service Mark): You select a specific asset allocation from among
the investment divisions and the Fixed Interest Account. Each quarter, we
transfer amounts among these options to bring the percentage of your Account
Balance in each option back to your original allocation.
The Index Selector(Service Mark): You may select one of five asset allocation
models which are designed to correlate to various risk tolerance levels. Based
on the model you choose, your entire Account Balance is divided among the Lehman
Brothers Aggregate Bond Index, MetLife Stock Index, Morgan Stanley
EAFE(Registered) Index and Russell 2000 Index investment divisions and the Fixed
Interest Account. Each quarter, the percentage in each of these investment
divisions and the Fixed Interest Account is brought back to the original
percentage by transferring amounts among the investment divisions and the Fixed
Interest Account.
In the future, we may permit you to allocate less than 100% of your Account
Balance to this strategy. This strategy may experience more volatility than our
other strategies. The models are subject to change from time to time. We provide
the elements to formulate the models. We may rely on a third party for its
expertise in creating appropriate allocations.
The Allocator(Service Mark): Each month a dollar amount you choose is
transferred from the Fixed Interest Account to any of the investment divisions
you choose. You select the day of the month and the number of months over which
the transfers will occur. A minimum transfer of $50 is the only requirement.
The Equity Generator and the Allocator are dollar cost averaging strategies.
Dollar cost averaging involves investing at regular intervals of time. Since
this involves continuously investing regardless of fluctuating prices, you
should consider whether you can continue the strategy through periods of
fluctuating prices.
Purchase Payments
There is no minimum purchase payment except for the unallocated Keogh Deferred
Annuity. If you have an unallocated Keogh Deferred Annuity, each purchase
payment must be at least $2,000. In addition, your total purchase payments must
be least $15,000 for your first Contract Year and $5,000 for each subsequent
Contract Year. Unless limited by tax law, you may continue to make purchase
payments while you receive Systematic Withdrawal Program payments, as described
later in this Prospectus, unless your purchase payments are made through salary
reduction or salary deduction.
Allocation of Purchase Payments
You decide how your money is allocated among the Fixed Interest Account and the
investment divisions. You can change your allocations for additional purchase
payments. We will make allocation changes when we receive your request for a
change. You may also specify an effective date for the change as long as it is
within 30 days after we receive the request.
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You may make purchase payments to your Deferred Annuity whenever you choose, up
to the date you begin receiving payments from a pay-out option. However, Federal
tax rules may limit the amount and frequency of your purchase payments.
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Limits on Purchase Payments
Your ability to make purchase payments may be limited by:
o Federal tax laws;
o Our right to limit the total of your purchase payments to $500,000. We may
change the maximum by telling you in writing at least 90 days in advance.
o Regulatory requirements. For example, if you reside in Washington or
Oregon, we may be required to limit your ability to make purchase payments
after you have held the Deferred Annuity for more than three years, if the
Deferred Annuity was issued to you after you were age 60, or after you turn
age 63, if the Deferred Annuity was issued before you were age 61 (Except
under a PEDC Deferred Annuity).
o For Keogh, TSA and PEDC Deferred Annuities, a withdrawal if you should
leave your job.
o Receiving systematic termination payments (described later.)
The Value of Your Investment
Accumulation Units are credited to you when you make purchase payments or
transfers into an investment division. When you withdraw or transfer money from
an investment division, accumulation units are liquidated. We determine the
number of accumulation units you have by dividing the amount of your purchase
payment, transfer or withdrawal by the Accumulation Unit Value on the date of
the transaction.
This is how we calculate the Accumulation Unit Value for each investment
division:
o First, we determine the change in investment performance (including any
investment-related charge) for the underlying Portfolio from the previous
trading day to the current trading day;
o Next, we subtract the daily equivalent of our insurance-related charge
(general administrative expenses and mortality and expense risk charges)
for each day since the last Accumulation Unit Value was calculated; and
o Finally, we multiply the previous Accumulation Unit Value by this result.
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Examples
Calculating the Number of Accumulation Units
Assume you make a purchase payment of $500 into one investment division and that
investment division's Accumulation Unit Value is currently $10.00. You would be
credited with 50 accumulation units.
$500/10 = 50 accumulation units
Calculating the Accumulation Unit Value
Assume yesterday's Accumulation Unit Value was $10.00 and the number we
calculate for today's investment experience (minus charges) for an underlying
portfolio is 1.05. Today's Accumulation Unit Value is $10.50. The value of your
$500 investment is then $525.
$10.00 x 1.05 = $10.50 is the new Accumulation Unit Value
However, assume that today's investment experience (minus charges) is .95
instead of 1.05. Today's Accumulation Unit Value is $9.50. The value of your
$500 investment is then $475.
$10.00 x .95 = $9.50 is the new Accumulation Unit Value
Transfers
You can make an unlimited number of transfers between investment divisions or
between the investment divisions and the Fixed Interest Account. For us to
process a transfer, you must tell us:
o The percentage or dollar amount of the transfer;
o The investment division (or Fixed Interest Account) from which you want the
money to be transferred;
o The investment division (or Fixed Interest Account) to which you want the
money to be transferred; and
o Whether you intend to start, stop or modify an automated investment strategy
by making the transfer.
We may require you to:
o Use our forms;
o Maintain a minimum Account Balance (if the transfer is in connection with
an automated investment strategy or if there is an outstanding loan from
the Fixed Interest Account); or
o Transfer a minimum amount if the transfer is in connection with the
Allocator.
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You may transfer money within your contract as often as you like without
incurring current taxes on your earnings.
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Access To Your Money
You may withdraw either all or a part of your Account Balance from the Deferred
Annuity. Withdrawals must be at least $500 (or the Account Balance, if less). To
process your request, we need the following information:
o The percentage or dollar amount of the withdrawal; and
o The investment division (or Fixed Interest Account) from which you want the
money to be withdrawn.
If you request, generally you can tell us to make payments directly to other
investments on a tax-free basis. You may only do so if all applicable tax and
state regulatory requirements are met and we receive all information necessary
for us to make the payment. We may require you to use our forms.
If you are a member of the Michigan Education Association and employed with a
school district which purchased a TSA Deferred Annuity before January 15, 1996,
then you must tell us the source of money from which we may take a withdrawal.
This includes salary reduction, elective deferrals, direct rollovers, direct
transfers or employer contributions.
Systematic Withdrawal Program For TSA Deferred Annuities
If we agree and if approved in your state for TSA Deferred Annuities, you may
choose to automatically withdraw a specific dollar amount or a percentage of
your Account Balance each Contract Year. This amount is then paid in equal
portions throughout the Contract Year according to the time frame you select,
e.g., monthly, quarterly, semi-annually or annually. Once the Systematic
Withdrawal Program is initiated the payments will automatically review each
Contract Year.
If you elect to withdraw a dollar amount we will pay you the dollar amount each
Contract Year. If you elect to withdraw a percentage of your Account Balance,
each Contract Year we recalculate the dollar amount you will receive based on
your new Account Balance.
Calculating Your Payment Based on a Percentage Election for the First Contract
Year You Elect the Systematic Withdrawal Program: If you choose to receive a
percentage of your Account Balance, we will determine the dollar amount payable
on the date these payments begin. When you first elect the program, we will pay
this dollar amount over the remainder of the Contract Year. For example, if you
select to receive payments on a monthly basis, the percentage of your Account
Balance you request equals $12,000, and there are six months left in the
Contract Year, we will pay you $2,000 a month.
Calculating Your Payment for Subsequent Contract Years of the Systematic
Withdrawal Program: For each subsequent year that your Systematic
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Income taxes, tax penalties and early withdrawal charges may apply to any
withdrawal you make. Tax law generally prohibits withdrawals from TSA Deferred
Annuities before you reach age 59 1/2.
We will withdraw the payments from the Fixed Interest Account or investment
divisions you select, either pro rata or in the proportions you request. Each
payment must be at least $50.
If you elect to receive payments through this program, you must either be over
59 1/2 years old or have left your job.
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Withdrawal Program remains in effect, we will deduct from your Deferred Annuity
and pay you over the Contract Year either the dollar amount that you chose or a
dollar amount equal to the percentage of your Account Balance you chose. For
example, if you select to receive payments on a monthly basis, ask for a
percentage and that percentage equals $12,000 at the start of a Contract Year,
we will pay you $1,000 a month.
If you do not provide us with your desired allocation, or there are insufficient
amounts in the investment divisions or the Fixed Interest Account that you
selected, the payments will be taken out pro rata from the Fixed Interest
Account and any investment divisions in which you then have money.
Selecting a Payment Date: Your payment date is the date we make the withdrawal.
When you select or change a payment date, we must receive your request at least
10 days prior to the selected payment date. If we do not receive your request in
time, we will make the payment a month after the date you selected. If you do
not select a payment date, we will automatically begin systematic withdrawals
within 30 days after we receive your request. Changes in the dollar amount,
percentage, or timing of payments can be made once a year at the beginning of
any Contract Year. However, we must receive your request at least 30 days in
advance. If you make any of these changes we will treat your request as though
you were starting a new Systematic Withdrawal Program.
Although we need your written authorization to begin this program, you may
cancel this program at any time by telephone or by writing to us at your MetLife
Designated Office.
Systematic Withdrawal Program payments may be subject to an early withdrawal
charge unless an exception to this charge applies. For purposes of determining
how much of the annual payment amount is exempt from this charge under the free
withdrawal provision (discussed later), all Systematic Withdrawal Program
payments in a Contract Year are characterized as a single lump sum withdrawal as
of your first payment date in that Contract Year. When you first elect the
program, we will calculate the percentage of your Account Balance your
Systematic Withdrawal Program payment represents based on your Account Balance
on the first Systematic Withdrawal Program payment date. For all subsequent
Contract Years, we will calculate the percentage of your Account Balance your
Systematic Withdrawal Program payment represents based on your Account Balance
on the first Systematic Withdrawal Program payment date of that Contract Year.
We will determine separately the early withdrawal charge and any relevant
factors (such as applicable exceptions) for each Systematic Withdrawal Program
payment as of the date it is withdrawn from your Deferred Annuity.
________________________________________________________________________________
Your Account Balance will be reduced by the amount of your systematic withdrawal
payments and applicable withdrawal charges. Payments under this program are not
the same as income payments you would receive from a Deferred Annuity pay-out
option or under an Income Annuity.
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Minimum Distribution
In order for you to comply with certain tax law provisions, you may be required
to take money out of your Deferred Annuity. Rather than receiving your minimum
distribution in one annual lump-sum payment, you may
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request that we pay it to you in installments throughout the calendar year.
However, we may require that you maintain a certain Account Balance at the time
you request these payments.
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If you would like to receive your systematic withdrawal payment by the first of
the month you should request that the payment date be the 20th of the prior
month.
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Contract Fee
There is no Separate Account annual contract fee.
o For all contracts except the Keogh Deferred Annuity and certain TSA
Deferred Annuities, you pay a $20 annual fee from the Fixed Interest
Account at the end of each Contract Year if your Account Balance is less
than $10,000 and if you fail to make purchase payments during the year.
o For the Keogh Deferred Annuity with individual participant recordkeeping
(allocated) you pay a $20 charge applied against any amounts in the Fixed
Interest Account.
o For the Keogh Deferred Annuity with no individual participant recordkeeping
(unallocated) there is no contract fee.
o There is no contract fee for certain TSA Deferred Annuities.
Charges
There are two types of charges you pay while you have money in an investment
division:
o Insurance-related charge, and
o Investment-related charge.
Insurance-Related Charge
You will pay an insurance-related charge for the Separate Account that is no
more than 1.25% annually of the average value of the amount you have in the
Separate Account. This charge pays us for general administrative expenses and
for the mortality and expense risk of the Deferred Annuity.
General administrative expenses we incur include financial, actuarial,
accounting, and legal expenses.
The mortality portion of the insurance-related charge pays us for the risk that
you may live longer than we estimated. Then, we could be obligated to pay you
more in payments from a pay-out option than we anticipated. Also, for allocated
Deferred Annuities, we bear the risk that the guaranteed death benefit we would
pay should you die during your "pay-in" phase is larger than your Account
Balance. We also bear the risk that our expenses in administering the Deferred
Annuities may be greater than we estimated (expense risk).
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Investment-Related Charge
This charge pays the investment managers of the Metropolitan Fund and Calvert
Fund for managing money in the Portfolios and investment operating expenses. We
manage the Metropolitan Fund. The percentage you pay depends on which investment
divisions you select. Amounts for each investment division are listed in the
Table of Expenses.
Annuity Taxes
Some jurisdictions tax what are called "annuity considerations." These may apply
to purchase payments, Account Balances and death benefits. In most
jurisdictions, we currently do not deduct any money from purchase payments,
Account Balances or death benefits to pay these taxes. Generally, our practice
is to deduct money to pay annuity taxes (also known as "premium taxes") only
when you exercise a pay-out option. In certain jurisdictions, we may also deduct
money to pay annuity taxes on lump sum withdrawals or when you exercise a
pay-out option. We may deduct an amount to pay annuity taxes some time in the
future since the laws and the interpretation of the laws relating to annuities
are subject to change.
A chart in the Appendix shows the jurisdictions where annuity taxes are charged
and the amount of these taxes.
Early Withdrawal Charges
An early withdrawal charge of up to 7% may apply if you withdraw purchase
payments within 7 years of when they were credited to your Deferred Annuity. To
determine the early withdrawal charge for Deferred Annuities, we treat your
Fixed Interest Account and Separate Account as if they were a single account and
ignore both your actual allocations and the Fixed Interest Account or investment
division from which the withdrawal is actually coming. To do this, we first
assume that your withdrawal is from amounts (other than earnings) that can be
withdrawn without an early withdrawal charge, then from other amounts (other
than earnings) and then from earnings, each on a "first-in-first-out" (oldest
money first) basis. Once we have determined the amount of the early withdrawal
charge, we will actually withdraw it from the Fixed Interest Account and the
investment divisions in the same proportion as the withdrawal is being made. In
determining what the withdrawal charge is, we do not include earnings, although
the actual withdrawal to pay it may come from earnings.
For partial withdrawals, the early withdrawal charge is determined by dividing
the amount that is subject to the early withdrawal charge by 100% minus the
applicable percentage shown in the following chart. Then we will make the
payment directed, and withdraw the early withdrawal charge.
For a full withdrawal we multiply the amount to which the withdrawal charge
applies by the percentage shown, keep the result as an early
________________________________________________________________________________
The charges you pay will not reduce the number of accumulation units credited to
you. Instead, we deduct the charges each time we calculate the Accumulation Unit
Value.
MetLife guarantees that the Separate Account insurance-related charge will not
increase while you have a Deferred Annuity.
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withdrawal charge and pay you the rest. We will treat your request as a request
for a full withdrawal if your Account Balance is not sufficient to pay both the
requested withdrawal and the early withdrawal charge.
The early withdrawal charge on purchase payments withdrawn is as follows:
During Purchase Payment/Contract Year
Year 1 2 3 4 5 6 7 8 & Later
Percentage 7% 6% 5% 4% 3% 2% 1% 0
If you are a member of the Michigan Education Association and employed by a
school district which purchased a TSA Deferred Annuity before January 15, 1996,
then we impose the early withdrawal charge in the above table for the first
seven Contract Years.
By law, your total early withdrawal charges applied to the
investment divisions will never exceed 9% of all your purchase payments in the
investment divisions.
The early withdrawal charge reimburses us for our costs in selling the Deferred
Annuities. We may use our profits (if any) from the mortality and expense risk
charge to pay for our costs to sell the Deferred Annuities which exceed the
amount of early withdrawal charges we collect. However, we believe that our
sales costs may exceed the early withdrawal charges we collect. If so, we will
pay the difference out of our general profits.
When No Early Withdrawal Charge Applies
In some cases, we will not charge you the early withdrawal charge when you make
a withdrawal. We may, however, ask you to prove that you meet any conditions
listed below.
You do not pay an early withdrawal charge:
o On transfers you make within your Deferred Annuity.
o On withdrawals of purchase payments you made over seven years ago.
o If you choose payments over one or more lifetimes or for a period of at
least five years (without the right to accelerate the payments).
o If you die during the pay-in phase. Your beneficiary will receive the full
death benefit without deduction.
o If you withdraw up to 10% (20% for the unallocated Keogh and certain TSA
Deferred Annuities) of your Account Balance each Contract Year. This 10% (or
20%) total withdrawal may be taken in an unlimited number of partial
withdrawals during that Contract Year. Each time you make a withdrawal, we
calculate what percentage your withdrawal represents at that time. Only when
the total of these percentages exceeds 10% (or 20%) will you have to pay
early withdrawal charges. If you have a Keogh Deferred Annuity, generally
you are allowed to take the "free withdrawal" on top of any other
withdrawals which are
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You will not pay an early withdrawal charge on any purchase payments made more
than 7 years ago.
We do not include your earnings when calculating early withdrawal charges.
However, if the early withdrawal charge is greater than the rest of your
purchase payments, then we will take the early withdrawal charges, in whole or
in part, from your earnings.
Early withdrawal charges never apply to transfers among investment divisions or
transfers to or from the Fixed Interest Account.
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otherwise exempt from the early withdrawal charge. This is not true if your
other withdrawals are in connection with a systematic termination or
purchase payments made over 7 years ago.
o If the withdrawal is required for you to avoid Federal income tax penalties
or to satisfy Federal income tax rules or Department of Labor regulations
that apply to your Deferred Annuity.
o Systematic Termination. For unallocated Keogh and certain TSA Deferred
Annuities, and the TSA Deferred Annuity for certain Texas institutions of
higher education which takes effect when the institution withdraws its
endorsement of the TSA Deferred Annuity or if you retire or leave your job
according to the requirements of the Texas Optional Retirement Program, you
may withdraw your total Account Balance without an early withdrawal charge
when the Account Balance is paid in annual installments based on the
following percentages of your Account Balance for that year's withdrawal:
Contract Year
Year 1* 2 3 4 5
Percentage 20% 25% 33 1/3% 50% remainder
* Less that Contract Year's withdrawals
Any money you withdraw in excess of these percentages in any Contract Year
will be subject to early withdrawal charges. You may stop the systematic
termination of the contract. If you ask to restart systematic termination,
you begin at the beginning of the schedule listed above.
o If you are disabled and request a total withdrawal. Disability is defined in
the Federal Social Security Act. If the Keogh or TSA Deferred Annuity is
issued in connection with your retirement plan which is subject to the
Employee Retirement Income Security Act of 1974 and if your plan document
defines disability, your plan's definition governs.
o If you retire:
o For the Keogh, TSA and 403(a) Deferred Annuities, if there is a plan and
you retire according to the requirements of the plan.
o For the unallocated Keogh Deferred Annuity, if your plan defines retirement
and you retire under that definition. If you are a "restricted" participant,
according to the terms of the Deferred Annuity, you must have participated in
the Deferred Annuity for the time stated in the contract.
o For certain TSA Deferred Annuities without a plan, if you have continuously
participated for at least 10 years. This exemption does not apply to
withdrawals of money transferred into these TSA Deferred Annuities from other
investment vehicles on a tax free basis (plus earnings on such amounts).
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o For the allocated Keogh Deferred Annuity, if you have continuously
participated for at least 7 years.
o For the PEDC Deferred Annuity, if you retire.
o For certain TSA Deferred Annuities, if you retired before the contract was
purchased (including money transferred from other investment vehicles on a
tax free basis plus earnings on that money).
o If you leave your job:
o For the unallocated Keogh Deferred Annuity, also if you are a "restricted"
participant, according to the terms of the Deferred Annuity, you must have
participated in the Deferred Annuity for the time stated in the contract.
o For the TSA and 403(a) Deferred Annuities, also if you have continuously
participated for at least 10 years. This exemption does not apply to
withdrawals of money transferred into TSA and 403(a) Deferred Annuities from
other investment vehicles on a tax free basis (plus earnings on such
amounts).
o For the allocated Keogh Deferred Annuity, also if you have continuously
participated for at least 7 years.
o For PEDC and certain TSA Deferred Annuities, if you leave your job with the
employer that bought the Deferred Annuity.
o For certain TSA Deferred Annuities, if you left your job before the contract
was purchased (including money transferred from other investment vehicles on
a tax free basis plus earnings on that money).
o For Keogh and certain TSA Deferred Annuities, if your plan terminates and the
Account Balance is transferred into another annuity contract we issue.
o For PEDC, unallocated Keogh and certain TSA Deferred Annuities, if you suffer
from an unforeseen hardship.
o For Keogh Deferred Annuities, if you make a direct transfer to another
investment vehicle we have preapproved. For the unallocated Keogh Deferred
Annuity, if you are a "restricted" participant, according to the terms of the
Deferred Annuity, you also must roll over your Account Balance to a MetLife
individual retirement annuity within 120 days after you are eligible to
receive a plan distribution.
When Another Early Withdrawal Charge May Apply
If you transferred money from certain eligible MetLife contracts into a
Deferred Annuity. You may have different early withdrawal charges for these
transfer amounts. Any purchase payments made after the transfer are subject
to the usual early withdrawal charge schedule.
o Amounts transferred before January 1, 1996:
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o We credit your transfer amounts with the time you held them under your
original contract or if it will produce a lower charge;
o We use the following schedule to determine early withdrawal charges
(determined as previously described) for transferred amounts from your
original contract.
During Purchase Payment Year
Year 1 2 3 4 5 6 and Beyond
Percentage 5% 4% 3% 2% 1% 0%
o Amounts transferred on or after January 1, 1996:
o For certain contracts which we issued at least two years before the date of
the transfer (except as noted below), we apply the withdrawal charge under
your original contract but not any of the original contract's exceptions or
reductions to the withdrawal charge percentage that do not apply to a
Deferred Annuity or if it will produce a lower charge.
o We use the following schedule to determine early withdrawal charges
(determined as previously described) for transferred amounts from your
original contract:
After the Transfer
Year 1 2 3 4 5 6 and Beyond
Percentage 5% 4% 3% 2% 1% 0%
o If we issued the other contract less than two years before the date of the
transfer or it has a separate withdrawal charge for each purchase payment, we
treat your purchase payments under the other contract as if they were made
under the Deferred Annuity as of the date we received them under that
contract.
o Alternatively, if provided for in your Deferred Annuity, we credit your
purchase payments with the time you held them under your original contract.
Free Look
You may cancel the Deferred Annuity within a certain time period. This is known
as a "free look." We must receive your request to cancel in writing. The number
of days for this "free look" varies from state to state. The time
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period may also vary depending on your age and whether you purchased the
Deferred Annuity from us directly, through the mail or with money from another
annuity or life insurance policy. Again, depending on state law, we may refund
all of your purchase payments or your Account Balance as of the date your refund
request is received at your MetLife Designated Office.
Death Benefit
One of the insurance guarantees we provide you under the Deferred Annuity is
that your beneficiaries will be protected against market downturns. You name
your beneficiary(ies) for TSA and 403(a) Deferred Annuities. Your beneficiary
under a PEDC Deferred Annuity is the trustee or employer. Under a Keogh Deferred
Annuity the death benefit is paid to the plan's trustee. If you die during the
pay-in phase, the death benefit your beneficiary receives will be the greatest
of:
o Your Account Balance;
o Your highest Account Balance as of the end of any fifth calendar year in
which you have the Deferred Annuity and as of the end of each later five year
period. In any case, less any later partial withdrawals, fees, charges and
outstanding loans; or
o The total of all of your purchase payments less any partial withdrawals,
In each case, we deduct the amount of any outstanding loans from the death
benefit.
For the allocated Keogh Deferred Annuity, your death benefit under the Deferred
Annuity will be no more than your Account Balance.
We will only pay the death benefit when we receive both proof of your death and
appropriate instructions for payment.
Your beneficiary has the option to apply the death benefit (less any applicable
annuity taxes) to a pay-out option offered under your Deferred Annuity. Your
beneficiary may, however, decide to take a lump sum cash payment.
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There is no death benefit for the unallocated Keogh Deferred Annuity.
________________________________________________________________________________
Pay-out Options (or Income Options)
You may receive a regular stream of money after your "pay-in" or "accumulation"
phase. When you are selecting your pay-out option, you will be able to choose
from the range of options we then have available. If you decide you want a
pay-out option, we withdraw some or all of your Account Balance (less any
annuity taxes, applicable contract fees and outstanding loans). Then, we apply
the remainder to the option. Generally, you may defer receiving payments for up
to one year after you have chosen your pay-out option.
When considering a pay-out option, you should think about whether:
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o You want payments guaranteed by us for the rest of your life (or for the rest
of two lives) or for a specified period;
o You want a fixed dollar payment or a variable payment;
o You want a refund feature.
Your income payment amount will depend upon the option you choose. For liftetime
options, the age and sex of the measuring lives (annuitants) will also be
considered.
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The pay-out phase is often referred to as either "annuitizing" your contract or
an income annuity.
_______________________________________________________________________________
By the date specified in your contract, if you do not either elect to continue
the contract, select a pay-out option or withdraw your entire Account Balance,
and your Deferred Annuity was not issued under a retirement plan, we will
automatically issue you a life annuity with a 10 year guarantee. In that case,
if you do not tell us otherwise, your Fixed Interest Account Balance will be
used to provide a Fixed Income Option and your Separate Account Balance will be
used to provide a variable pay-out option. However, if we do ask you what you
want us to do and you do not respond, we may treat your silence as a request by
you to continue your Deferred Annuity.
Because many of the features of variable pay-out options under the Deferred
Annuities are identical to the features of Income Annuities, we are providing
more information about variable pay-out options under the "Income Annuities"
heading.
_______________________________________________________________________________
Should our current immediate annuity rates for a fixed pay-out option provide
for greater payments than those quoted in your contract, we will use the current
rates.
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Income Annuities
Income Annuities provide you with a regular stream of payments for either your
lifetime or a specific period. Income Annuities can be purchased so that you
begin receiving payments immediately or you can apply the Account Balance of the
Deferred Annuity to a pay-out option to receive payments during your "pay-out"
phase. With an Income Annuity, you must start receiving payments within the
first year after the annuity is issued.
We do not guarantee that your variable payments will be a specific amount of
money. You may choose to have a portion of the payment fixed and guaranteed
under the Fixed Income Option.
Using proceeds from the following types of arrangements, you may purchase Income
Annuities to receive immediate payments:
o TSA
o PEDC
o Keogh
o 403(a)
If you have accumulated amounts in any of the listed investment vehicles, your
lump sum withdrawal from that investment vehicle may be used to purchase an
appropriate Income Annuity as long as income tax requirements are met.
_______________________________________________________________________________
You may choose the frequency of your income payments. For example, you may
receive your payments on a monthly, quarterly, semiannual or annual basis.
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If your retirement plan has purchased an Income Annuity, your choice of pay-out
options may be subject to the terms of the plan. We may rely on your employer's
or plan administrator's statements to us as to the terms of the plan or your
entitlement to any payments. We will not be responsible for interpreting the
terms of your plan. You should review your plan document to see how you may be
affected.
Income Payment Types
Currently, we provide you with a wide variety of income payment types to suit a
range of personal preferences.
There are three people who are involved in payments under your Income Annuity:
o Owner: the person or entity which has all rights under the Income Annuity
including the right to direct who receives payment.
o Annuitant: the person whose life is the measure for determining the timing
and sometimes the dollar amount of payments.
o Beneficiary: the person who receives continuing payments or a lump sum
payment if the owner dies.
The following income payment types are available:
Your Lifetime Annuity: A variable income payable during the annuitant's life.
________________________________________________________________________________
Many times the Owner and the Annuitant are the same person.
________________________________________________________________________________
Your Lifetime with a Guaranteed Period Annuity: A variable income payable during
the annuitant's life with a guaranteed number of years. If, at the death of the
annuitant, payments have been made for less than the guaranteed period, payments
are made to the owner of the annuity (or the beneficiary if the owner dies
before the end of the guaranteed period) for the rest of the guaranteed period.
Your Lifetime With a Refund Annuity: A variable income payable during the
annuitant's life with a refund provision. If, at the death of the annuitant, the
total of all income payments is less than the purchase payment that we received,
we will pay the owner of the annuity (or to the beneficiary if the owner is not
alive) an amount equal to the difference.
Income for Two Lives Annuity: A variable income payable while either of two
annuitants is alive. After one annuitant dies, payments continue if the other
annuitant is alive. Payments stop once both annuitants are no longer alive.
Payments after one annuitant dies may be the same as those paid while both were
alive or may be a lower percentage that is selected when the annuity is
purchased (e.g. 75%, 66 2/3% or 50%).
________________________________________________________________________________
When deciding how to receive income, consider:
o The amount of income you need;
o The amount you expect to receive from other sources;
o The growth potential of other investments; and
o How long you would like your income to last.
________________________________________________________________________________
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Income for Two Lives with a Guaranteed Period Annuity: This is the same as the
Income for Two Lives Annuity described above, but we guarantee to pay the full
amount (not a reduced percentage) for the guaranteed period even if one or both
annuitants die. If, upon the death of both annuitants, payments have been made
for less than the guaranteed period, payments are made to the owner of the
annuity (or the beneficiary if the owner dies before the end of the guaranteed
period) for the rest of the guaranteed period.
Income for Two Lives with a Refund Annuity: This is the same as the Income for
Two Lives Annuity described above, but if upon the death of both annuitants, the
total of all of income payments is less than the purchase payment that we
received, we will pay the owner of the annuity (or to the beneficiary if the
owner is not alive) an amount equal to the difference.
Income for a Guaranteed Period Annuity: A variable income payable for a
guaranteed period (5-30 years). Payments cease at the end of the guaranteed
period (which is often called a "term certain" period) even if the annuitant is
still alive. If the annuitant dies before the end of the guaranteed period,
payments are made to the owner of the annuity (or to the beneficiary if the
owner dies before the end of the guaranteed period) for the rest of the
guaranteed period.
Purchasing an Income Annuity
Your purchase payment must be large enough to produce an initial income payment
of at least $50. If you live in Massachusetts, the initial income payment must
be at least $20.
Allocation of Your Purchase Payment
You decide how your money is allocated among the Fixed Income Option and the
investment divisions.
The Value of Your Income Payments
Annuity units are credited to you when you make a purchase payment or transfer
into an investment division. When you transfer money from an investment
division, annuity units in that investment division are liquidated. Before we
determine the number of annuity units you have, we reduce your purchase payment
by any annuity taxes and the contract fee, if applicable. We then divide the
remainder by the Annuity Unit Value on the date of the transaction.
Your payment is determined by using the Assumed Investment Return ("AIR") to
benchmark the investment experience of the investment divisions you select. The
higher your AIR, the higher your first income payment will be. Your next
payments will only increase in proportion to the amount the investment
experience of your chosen investment divisions exceeds the AIR and Separate
Account charges. Likewise, your payments
________________________________________________________________________________
The AIR is stated in your contract and may range from 3% to 6%.
________________________________________________________________________________
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will decrease to the extent the investment experience of your chosen investment
divisions is less than the AIR and Separate Account charges. A lower AIR will
result in a lower initial variable income payment, but subsequent variable
income payments will increase more rapidly or decline more slowly as changes
occur in the investment experience of the investment divisions.
Your income payments are determined ten days prior to your income payment date
or your contract's issue date, if later.
This is how we calculate the Annuity Unit Value for each investment division:
o First, we determine the change in investment experience (including any
investment-related charge) for the underlying portfolio from the previous
trading day to the current trading day;
o Next, we subtract the daily equivalent of your insurance-related charge
(general administrative expenses and mortality and expense risk charges) for
each day since the last day the Annuity Unit Value was calculated;
o Then, we divide by the daily equivalent of your AIR; and
o Finally, we multiply the previous Annuity Unit Value by this result.
Transfers
You can make an unlimited number of transfers among investment divisions or from
the investment divisions to the Fixed Income Option. If you reside in certain
states you may be limited to four options (including the Fixed Interest Option).
For us to process a transfer, you must tell us:
o The percentage or dollar amount of the transfer;
o The investment division (or Fixed Income Option) to which you want to
transfer; and
o The investment division from which you want to transfer.
We may require that you use our forms to make transfers.
________________________________________________________________________________
Once you transfer money into the Fixed Income Option you may not later transfer
it into an investment division.
________________________________________________________________________________
Contract Fee
A one time $350 contract fee is taken from your purchase payment prior to
allocating the remainder of the purchase payment to either the investment
divisions and/or the Fixed Income Option. This charge covers our administrative
costs including preparation of the Income Annuities, review of applications and
recordkeeping. If you select a pay-out option under your Deferred Annuity and
you purchased that Deferred Annuity at least two years ago, we will waive the
contract fee.
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Charges
There are two types of charges you pay if you allocate any of your purchase
payment to the investment divisions:
o Insurance-related charge; and
o Investment-related charge.
Insurance-Related Charge
You will pay an insurance-related charge for the Separate Account that is no
more than 1.25% annually of the average value of the amount you have in the
Separate Account. This charge pays us for general administrative expenses and
for mortality and expense risk of the Income Annuity.
General administrative expenses we incur include financial, actuarial,
accounting, and legal expenses.
The mortality portion of the insurance-related charge pays us for the risk that
you may live longer than we estimated. Then, we could be obligated to pay you
more in payments than we anticipated.
We also bear the risk that our expenses in administering the Income Annuities
will be greater than we estimated (expense risk).
________________________________________________________________________________
The charges you pay will not reduce the number of annuity units credited to you.
Instead, we deduct the charges when calculating the Annuity Unit Value.
________________________________________________________________________________
Investment-Related Charge
This charge pays the investment managers of the Metropolitan Fund and Calvert
Fund for managing money in the Portfolios and for investment operating expenses.
We manage the Metropolitan Fund. The percentage you pay depends on the
investment divisions you select. Amounts for each investment division are listed
in the Table of Expenses.
Annuity Taxes
Some jurisdictions tax what are called "annuity considerations." We deduct money
to pay "annuity" taxes (also known as "premium" taxes) when you make the
purchase payment. A chart in the Appendix shows the jurisdictions where annuity
taxes are charged and the amount of these taxes.
Free Look
You may cancel your Income Annuity within a certain time period. This is known
as a "free look." We must receive your request to cancel in writing. The number
of days for this "free look" varies from state to state. The "free look" may
also vary depending on your age and whether you purchased your Income Annuity
from us directly, through the mail or with money from another annuity or life
insurance policy. Again, depending on state law, we may refund all of your
purchase payment or the value of your annuity units as of the date your refund
request is received at your MetLife Designated Office.
________________________________________________________________________________
You do not have a "free look" if you are electing income payments in the pay-out
phase of your Deferred Annuity.
________________________________________________________________________________
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General Information
Administration
All transactions will be processed in the manner described below.
Purchase Payments
Send your purchase payments by check or money order made payable to "MetLife" to
your MetLife Designated Office. We will provide you with all necessary forms. We
must have all completed documents to credit your purchase payments.
Usually, your initial purchase payment is credited to you within two days of
receipt at your MetLife Designated Office. However, if you fill out our forms
incorrectly or incompletely or other documentation is not completed properly, we
have up to five business days to credit the payment. If the problem cannot be
resolved by the fifth business day, we will notify you and give you the reasons
for the delay. At that time, you will be asked whether you agree to let us keep
your money until the problem is resolved. If you do not agree or we cannot reach
you by the fifth business day, your money will be returned.
Under certain group Deferred Annuities and group Income Annuities, your
employer, the trustee of the Keogh plan (if an allocated Deferred Annuity) or
the group in which you are a participant or member must identify you on their
reports to us and tell us how your money should be allocated among the
investment divisions and the Fixed Interest Account/Fixed Income Option.
Purchase payments (including any portion of your Account Balance under a
Deferred Annuity which you apply to a pay-out option) are effective and valued
as of 4:00 p.m. Eastern time, on the day we receive them in good order at your
MetLife Designated Office, except when they are received:
o On a day when the Accumulation Unit Value/Annuity Unit Value is not
calculated, or
o After 4:00 p.m. Eastern time.
In those cases, the purchase payments will be effective the next day the
Accumulation Unit Value or Annuity Unit Value, as applicable, is calculated.
________________________________________________________________________________
Generally, your requests including all subsequent purchase payments are
effective the day we receive them at your MetLife Designated Office.
________________________________________________________________________________
Confirming Transactions
You will receive a written statement confirming that a transaction was recently
completed. Certain transactions made on a periodic basis, such as Systematic
Withdrawal Program payments and automated investment strategy transfers, may be
confirmed quarterly. Salary reduction or deduction purchase payments under TSA
Deferred Annuities are confirmed quarterly.
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Transactions by Telephone
You may conduct a variety of transactions by telephone, unless prohibited by
state law. Some of these transactions include:
o Transfers
o Changes to investment strategies
o Changes in the allocation of future purchase payments.
Your telephone transaction must be completed by 4:00 p.m. Eastern time if you
want the transaction to take place on that day.
We have put into place reasonable security procedures to insure that
instructions communicated by telephone are genuine. For example, all telephone
calls are recorded. Also, you will be asked to provide some personalized data
prior to giving your instructions over the telephone. When someone contacts us
by telephone and follows our security procedures, we will assume that you are
authorizing us to act upon those telephone instructions. Neither we nor the
Separate Account will be liable for any loss, expense or cost arising out of any
requests that we or the Separate Account reasonably believe to be authentic. In
the unlikely event that you have trouble reaching us, requests should be made in
writing to your MetLife Designated Office.
________________________________________________________________________________
You may authorize your sales representative to make telephone transactions on
your behalf. You must complete our form and we must agree. This does not apply
if you have a Keogh Deferred Annuity or Income Annuity.
________________________________________________________________________________
Processing of Certain Transactions
If we are notified of your death before a requested transaction is completed, we
will cancel the request. For example, if you request a transfer or withdrawal
for a date in the future under a Deferred Annuity and then die before that date,
we simply pay the death benefit instead. For Income Annuity transfers, we will
cancel the request and continue making payments to your beneficiary if your
Income Annuity so provides. Or, depending on your Income Annuity's provisions,
we may continue making payments to a joint annuitant or pay your beneficiary a
refund.
Valuation
We separately determine the Accumulation Unit Value and Annuity Unit Value for
each investment division once each day when the New York Stock Exchange is open
for trading. If permitted by law, we may change the period between calculations
but we will give you 30 days notice.
When you request a transaction, we will process the transaction using the next
available Accumulation Unit Value for Deferred Annuities or Annuity Unit Value
for Income Annuities. Subject to our procedure, we will make withdrawals under a
Deferred Annuity and transfers under a Deferred Annuity or Income Annuity at a
later date, if you request. If your withrawal request is to elect a variable
pay-out option under your Deferred Annuity, we base the number of annuity units
you receive on the next available Annuity Unit Value.
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Advertising Performance
We periodically advertise the performance of the investment divisions. You may
get performance information from a variety of sources including your quarterly
statements, your MetLife representative, the internet, annual reports and
semiannual reports.
_______________________________________________________________________________
All performance numbers are based upon historical earnings. These numbers are
not intended to indicate future results.
_______________________________________________________________________________
We may state performance in terms of "yield," "change in Accumulation Unit
Value/Annuity Unit Value," "average annual total return," or some combination
of these terms.
Yield is the net income generated by an investment in a particular investment
division for 30 days or a month. These figures are expressed as percentages.
This percentage yield is compounded semiannually.
Change in Accumulation/Annuity Unit Value is calculated by determining the
percentage change in the value of an accumulation (or annuity) unit for a
certain period. These numbers may also be annualized. Change in
Accumulation/Annuity Unit Value may be used to demonstrate performance for a
hypothetical investment (such as $10,000) over a specified period. These
performance numbers reflect the deduction of the total Separate Account
charges; however, yield and change in Accumulation/Annuity Unit Value
performance do not reflect the possible imposition of early withdrawal
charges. Early withdrawal charges would reduce performance experience.
Average annual total return calculations reflect all Separate Account charges
and applicable early withdrawal charges. These figures also assume a steady
annual rate of return.
Performance figures will vary among the various Deferred Annuities and Income
Annuities as a result of different Separate Account charges and early
withdrawal charges. For purposes of presentation, we may assume that certain
Deferred Annuities and Income Annuities were in existence prior to their
inception date. In these cases, we calculate performance based on the
historical performance of the underlying Metropolitan Fund and Calvert Fund
Portfolios. We use the actual accumulation unit or annuity unit data after the
inception date.
We calculate performance for certain investment strategies including the
Equalizer, Equity Generator and each asset allocation model of the Index
Selector. We calculate the performance as a percentage by presuming a certain
dollar value at the beginning of a period and comparing this dollar value with
the dollar value based on historical performance at the end of that period.
This percentage return assumes that there have been no withdrawals or other
unrelated transactions.
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Changes to Your Deferred Annuity or
Income Annuity
We have the right to make certain changes to your Deferred Annuity or Income
Annuity, but only as permitted by law. We make changes when we think they
would best serve the interest of annuity owners or would be appropriate in
carrying out the purposes of the Deferred Annuity or Income Annuity. If the
law requires, we will also get your approval and the approval of any
appropriate regulatory authorities. Examples of the changes we may make
include:
o To operate the Separate Account in any form permitted by law.
o To take any action necessary to comply with or obtain and continue any
exemptions under the law.
o To transfer any assets in an investment division to another
investment division, or to one or more separate accounts, or to our
general account, or to add, combine or remove investment divisions in
the Separate Account.
o To substitute for the Portfolio shares in any investment division, the
shares of another class of the Metropolitan Fund or the shares of another
investment company or any other investment permitted by law.
o To change the way we assess charges, but without increasing the aggregate
amount charged to the Separate Account and any currently available
portfolio in connection with the Deferred Annuities or Income Annuities.
o To make any necessary technical changes in the Deferred Annuities or
Income Annuities in order to conform with any of the above-described
actions.
If any changes result in a material change in the underlying investments of an
investment division in which you have a balance, we will notify you of the
change. You may then make a new choice of investment divisions. For Deferred
Annuities issued in Pennsylvania (and Income Annuities where required by law),
we will ask your approval before making any technical changes.
Voting Rights
Based on our current view of applicable law, you have voting interests under
your Deferred Annuity or Income Annuity concerning Metropolitan Fund and
Calvert Fund proposals that are subject to a shareholder vote. Therefore, you
are entitled to give us instructions for the number of shares which are deemed
attributable to your Deferred Annuity or Income Annuity.
We will vote the shares of each of the underlying Portfolios held by the
Separate Account based on instructions we receive from those having a
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voting interest in the corresponding investment divisions. However, if the law
or the interpretation of the law changes, we may decide to exercise the right
to vote the Portfolio's shares based on our own judgment.
You will be entitled to give instructions regarding the votes attributable to
your Deferred Annuity or Income Annuity in your sole discretion. Under the
Keogh Deferred Annuities, participants may instruct you to give us
instructions regarding shares deemed attributable to their contributions to
the Deferred Annuity. Under the Keogh Deferred Annuities, we will provide you
with the number of copies of voting instruction soliciting material that you
request so that you may furnish such materials to participants who may give
you voting instructions. Neither the Separate Account nor MetLife has any duty
to inquire as to the instructions received or your authority to give
instructions; thus, as far as the Separate Account, and any others having
voting interests in respect of the Separate Account are concerned, such
instructions are valid and effective.
There are certain circumstances under which we may disregard voting
instructions. However, in this event, a summary of our action and the reasons
for such action will appear in the next semiannual report. If we do not
receive your voting instructions, we will vote your interest in the same
proportion as represented by the votes we receive from other investors. Shares
of the Metropolitan Fund that are owned by our general account or by any of
our unregistered separate accounts will be voted in the same proportion as the
aggregate of:
o The shares for which voting instructions are received, and
o The shares that are voted in proportion to such voting instructions.
However, if the law or the interpretation of the law changes, we may decide to
exercise the right to vote each Portfolio's shares based on our judgment.
Who Sells the Deferred Annuities and Income Annuities
All Deferred Annuities and Income Annuities, are sold through our licensed
sales representatives. We are registered with the Securities and Exchange
Commission as a broker-dealer under the Securities Exchange Act of 1934. We
are also a member of the National Association of Securities Dealers, Inc.
Deferred Annuities and Income Annuities are also sold through other registered
broker-dealers. They also may be sold through the mail.
The licensed sales representatives and broker-dealers who sell the annuities
may be compensated for these sales by commissions that we pay. There is no
front-end sales load deducted from purchase payments to pay sales commissions.
The Separate Account does not pay sales commissions. The commissions we pay
range from 0% to 6%.
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We also make payments to our licensed sales representatives based upon the
total Account Balances of the Deferred Annuities assigned to the sales
representative. Under this compensation program, we pay an amount up to .12%
of the total Account Balances of the Deferred Annuities and, other annuity
contracts, certain mutual fund account balances and cash values of certain
life insurance policies. These asset based commissions compensate the sales
representative for servicing the Deferred Annuities. These payments are not
made for Income Annuities.
From time to time,MetLife may pay organizations or associations a fee,
reimburse them for certain expenses, lease office space from them, purchase
advertisement in their publications or enter into other such arrangements in
connection with their endorsing or sponsoring MetLife's variable annuity
contracts or services, for permitting MetLife to undertake certain marketing
efforts of the organizations' members in connection with sales of MetLife
variable annuities, or some combination thereof. Additionally, MetLife has
retained consultants who are paid a fee for their efforts in establishing and
maintaining relationships between MetLife and various organizations.
Financial Statements
The financial statements for the Separate Account and MetLife are in the SAI
and are available from MetLife upon request.
Your Spouse's Rights
If you received your contract through a qualified retirement plan and your
plan is subject to ERISA (the Employee Retirement Income Security Act of 1974)
and you are married, the income payments, withdrawal and loan provisions, and
methods of payment of the death benefit under your Deferred Annuity or Income
Annuity may be subject to your spouse's rights.
If your benefit is worth $5,000 or less, your plan may provide for
distribution of your entire interest in a lump sum without your spouse's
consent.
For details or advice on how the law applies to your circumstances, consult
your tax advisor or attorney.
When We Can Cancel Your Deferred Annuity or Income Annuity
We may not cancel your Income Annuity.
We may cancel your Deferred Annuity only if we do not receive any purchase
payments from you for 36 consecutive months and your Account Balance is less
than $2,000, except for the unallocated Keogh Deferred Annuity. For the
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unallocated Keogh Deferred Annuity we may cancel the Deferred Annuity if we do
not receive purchase payments from you for 12 consecutive months and your
Account Balance is less than $15,000. If we cancel a Deferred Annuity
delivered in New York, we will return the full Account Balance. In all other
cases, you will receive an amount equal to what you would have received if you
had requested a total withdrawal of your Account Balance. Early withdrawal
charges may apply. Certain Deferred Annuities do not contain these
cancellation provisions.
Income Taxes
The following information on taxes is a general discussion of the subject. It
is not intended as tax advice. The Internal Revenue Code ("Code") is complex
and subject to change regularly.
_______________________________________________________________________________
Consult your own tax advisor about your circumstances, any recent tax
developments, and the impact of state income taxation.
_______________________________________________________________________________
You should read the general provisions and any sections relating to your type
of annuity to familiarize yourself with some of the tax rules for your
particular contract. The SAI has additional tax information.
For purposes of this section, we address Deferred Annuities and Income
Annuities together as annuities.
General
Deferred annuities are a means of setting aside money for future needs--
usually retirement. Congress recognizes how important saving for retirement is
and has provided special rules in the Internal Revenue Code (Code).
_______________________________________________________________________________
Simply stated, income tax rules for Deferred Annuities generally provide that
earnings are not subject to tax until withdrawn. This is referred to as tax
deferral.
_______________________________________________________________________________
Because these products are intended for retirement, if you make withdrawals
before age 59 1/2 you may incur a tax penalty.
We are not responsible for determining if your employer's plan or arrangement
satisfies the requirements of the Code and/or ERISA.
Contributions
Generally, all contributions will be contributed on a "before-tax" basis. This
means that the purchase payments either reduce your income, entitle you to a
tax deduction or are not subject to current income tax.
Under some circumstances "after-tax" contributions can be made to certain
annuities.
These contributions do not reduce your taxable income or give you a tax
deduction.
There are different annual contribution limits for the annuities offered in
this prospectus. Purchase payments in excess of the limits may result in
adverse tax consequences.
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Withdrawals
Because your contributions are generally on a before tax basis, you pay income
taxes on the full amount of money you withdraw as well as income earned under
the contract. If you made any after tax contributions they would not be
subject to income tax.
______________________________________________________________________________
Withdrawals and income payment are included in income except for the portion
that represents a return of non-deductible purchase payments.
_______________________________________________________________________________
If certain requirements are met, you may be able to transfer amounts in your
contract to another eligible retirement plan or IRA. For PEDC contracts, you
can only transfer such amounts to another PEDC plan.
Minimum Distribution Requirements
Generally, you must begin receiving withdrawals from your contract by April 1
of the calendar year following the later of:
o The year you turn age 70 1/2 or;
o Provided you do not own 5% or more of your employer, and to the
extent permitted by your plan and contract, the year you retire.
Complex rules apply to timing and calculating these withdrawals. A tax penalty
of 50% applies to withdrawals which should have been taken but were not.
Although the minimum distribution requirements for PEDC are similar to those
for TSA, 403(a) and Keogh, there are some differences.
Please consult the section for the type of annuity you purchased to determine
if there are restrictions to withdrawals.
Withdrawals Before Age 59 1/2
If you receive a taxable distribution from your contract before you reach age
59 1/2, this amount may be subject to a 10% penalty tax in addition to ordinary
income taxes. This does not apply to PEDC annuities.
As indicated in the chart below, some distributions prior to age 59 1/2 are
exempt from the penalty. Some of these exceptions include any amounts
received:
Type of Contract
---------------------
TSA Keogh 403(a)
--- ----- ------
In a series of substantially equal payments
made annually (or more frequently) for life or life
expectancy, after you have separated from service, x x x
After you die x x x
After you become totally disabled (as
defined in the Code) x x x
To pay deductible medical expenses x x x
After separation from service
if you are over age 55 x x x
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Mandatory 20% Withholding (Except PEDC)
We are required to withhold 20% of the taxable portion of your withdrawal that
constitutes an "eligible rollover distribution" for Federal income taxes. This
rule does not apply to PEDC contracts. We are not required to withhold this
money if you direct us, the trustee or the custodian of the plan to transfer
your eligible rollover distribution to a traditional IRA, or another eligible
retirement plan.
An "eligible rollover distribution" is any taxable amount you receive from
your contract. It does not include taxable distributions that are:
o A series of substantially equal payments made at least annually for:
o Your life or life expectancy
o Both you and your beneficiary's lives or life expectancies
o A specified period of 10 years or more
o Withdrawals to satisfy minimum distribution requirements
Other exceptions to the definition of eligible rollover distribution exist.
For taxable withdrawals that are not "eligible rollover distributions," the
Code requires different witholding rules. The witholding amounts are
determined at the time of payment. You may elect out of these withholding
requirements.
Systematic Withdrawal Program for Substantially Equal Periodic Payments (SEPP)
Except for PEDC, if you are considering using the Systemic Withdrawal Program
for the purpose of meeting the SEPP exception to the 10% tax penalty, consult
with your tax advisor.
If you receive systematic payments that you intend to qualify for the SEPP
exception, any modifications to your payment before age 59 1/2 or within five
years after beginning Systematic Withdrawal Program payments will result in
the retroactive imposition of the 10% penalty tax.
After Death
If you die before required minimum distribution withdrawals have begun, we
must make payment of your entire interest in the Contract within five years
after the year of your death or begin payments under an income annuity allowed
by the Code to your beneficiary by December 31st of the year after your death.
If your spouse is your beneficiary and if your contract permits, your spouse
may delay the start of income payments until December 31st of the year in
which you would have reached age 70 1/2.
If you die after required withdrawals begin, payments must continue at least
as rapidly as under the distribution method in effect at your death.
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TSA Annuities
General
TSAs fall under *403(b) of the Code which provides certain tax benefits to
eligible employees of public school systems and organizations that are tax
exempt under *501(c)(3) of the Code.
_______________________________________________________________________________
You may be subject to the 10% penalty tax if you withdraw money before you
turn 59 1/2.
_______________________________________________________________________________
Your employer buys the annuity for you although you then own it.
Your Deferred Annuity is not forfeitable (e.g., not subject to claims of your
creditors) and you may not transfer it to someone else.
Withdrawals
If you are under 59 1/2, you cannot withdraw money from your contract unless
the withdrawal:
o Relates to contributions made prior to 1989 (and earnings on those
contributions).
o Is directly transferred to other ss.403(b) arrangements;
o Relates to amounts that are not salary reduction elective deferrals
(i.e., attributed to your pre-tax contributions and their earnings.);
o Is after you die, leave your job or become disabled (as defined by the Code);
or
o Is for financial hardship (but only to the extent of purchase payments) if
your plan allows it.
See the general heading under Income Taxes for a brief description of the tax
rules that apply to TSA Annuities.
Keogh Annuities
General
Pension and profit-sharing plans satisfying certain Code provisions are
considered to be "Keogh" plans.
See the general heading under Income Taxes for a brief description of the tax
rules for Keogh Annuities.
PEDC
General
PEDC plans are available to state or local governments and certain tax-exempt
organizations as described in *457 of the Code. The plans are not available
for churches and qualified church-controlled organizations.
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PEDC annuities maintained by a state or local government are for the exclusive
benefit of plan participants and their beneficiaries.
PEDC annuities other than those maintained by state or local governments are
solely the property of the employer and are subject to the claims of the
employer's general creditors until they are "made available" to you.
Withdrawals
Generally, monies in your contract can not be "made available" to you until
you:
o Reach age 70 1/2
o Leave your job
o Have an unforeseen emergency (as defined by the Code)
Special Rules
Special rules apply to certain non-governmental PEDC plans deferring
compensation from taxable years beginning before January 1, 1987 (or beginning
later but based on an agreement in writing on August 16, 1986).
See the general heading under Income Annuities for a brief description of the
tax rules that apply to PEDC annuities.
403(a)
General
The employer adopts a 403(a) plan as a qualified retirement plan to provide
benefits to participating employees. The plan generally works in a similar
manner to a corporate qualified retirement plan except that the 403(a) plan
does not have a trust or a trustee.
See the general heading under Income Taxes for a brief description of the tax
rules that apply to 403(a) annuities.
B-PPA-45
<PAGE>
Table of Contents for the Statement of
Additional Information
Page
Cover Page ............................................ 1
Table of Contents ..................................... 1
Independent Auditors .................................. 2
Services .............................................. 2
Year 2000 ............................................. 2
Distribution of Certificates and Interests in the
Deferred Annuities and Income Annuities ......... 2
Early Withdrawal Charge ............................... 2
Experience Factor ..................................... 2
Variable Income Payments .............................. 2
Investment Management Fees ............................ 5
Performance Data and Advertisement of
the Separate Account ............................ 6
Voting Rights ......................................... 7
ERISA ................................................. 8
Taxes ................................................. 9
Performance Data ...................................... 22
Financial Statements of the Separate Account ..........
Financial Statements of MetLife .......................
B-PPA-46
<PAGE>
Appendix
Annuity Tax Table
If you are a resident of one of the following jurisdictions, the percentage
amount listed by that jurisdiction is the annuity tax rate which will be
applied to your Deferred Annuity or Income Annuity.
Keogh and PEDC
TSA Deferred 403(a) Deferred Deferred and
and Income and Income Income
Annuities Annuities Annuities (1)
California ............ 0.5% 0.5% 2.35%
Kentucky (3) .......... 2.0% 2.0% 2.0%
Maine ................. -- -- --
Nevada ................ -- -- --
Puerto Rico ........... 1.0% 1.0% 1.0%
South Dakota .......... -- -- --
U.S. Virgin Islands ... 5.0% 5.0% 5.0%
West Virginia ......... 1.0% 1.0% 1.0%
Wyoming ............... -- -- --
-------------
(1) Annuity tax rates applicable to Deferred and Income Annuities
purchased under retirement plans of public employers meeting the
requirements of Section 401(a) of the Code are included under the
column headed "Keogh Deferred and Income Annuities."
(2) The annuity tax in Kentucky is repealed effective January 1, 2000.
PEANUTS(Copyright) United Feature Syndicate, Inc.
(Copyright)1999 Metropolitan Life Insurance Company
B-PPA-47
<PAGE>
Appendix II
What You Need To Know If You Are A Texas Optional Retirement Program
Participant
If you are a participant in the Texas Optional Retirement Program, Texas law
permits us to make withdrawals on your behalf only if you die, retire or
terminate employment in all Texas institutions of higher education, as defined
under Texas law. Any withdrawal you ask for requires a written statement from
the appropriate Texas institute of higher education verifying your vesting
status and (if applicable) termination of employment. Also, we require a
written statement from you that you are not transferring employment to another
Texas institution of higher education. If you retire or terminate employment
in all Texas institutions of higher education or die before being vested,
amounts provided by the state's matching contribution will be refunded to the
appropriate Texas institution. We may change these restrictions or add others
without your consent to the extent necessary to maintain compliance with the
law.
B-PPA-48
<PAGE>
[LOGO OF METROPOLITAN LIFE INSURANCE COMPANY] [INDICIA]
Metropolitan Life Insurance Company
Johnstown Office, 500 Schoolhouse Road
Johnstown, PA 15904-2914
Address Service Requested
B-PPA-49
<PAGE>
April 30, 1999
Preference Plus(Registered) Account Variable Annuity Contracts
Issued by Metropolitan Life Insurance Company
This Prospectus describes group Preference Plus contracts for deferred
variable enhanced annuities ("Enhanced Deferred Annuities") and Preference
Plus immediate variable enhanced income annuities ("Enhanced Income
Annuities").
- --------------------------------------------------------------------------------
You decide how to allocate your money among the various available investment
choices. The investment choices available to you are listed in the contract
for your Enhanced Deferred Annuity or Enhanced Income Annuity. Your choices
may include the Fixed Interest Account (not described in this Prospectus) and
investment divisions available through the Metropolitan Life Separate Account
E which, in turn, invest in the following corresponding portfolios of the
Metropolitan Series Fund, Inc. ("Metropolitan Fund"):
State Street Research Aggressive Growth
State Street Research Diversified
State Street Research Growth
State Street Research Income
Harris Oakmark Large Cap Value
Janus Mid Cap
Loomis Sayles High Yield Bond
Neuberger&Berman Partners Mid Cap Value
Santander International Stock
Scudder Global Equity
T. Rowe Price Large Cap Growth
T. Rowe Price Small Cap Growth
Lehman Brothers Aggregate Bond Index
MetLife Stock Index
Morgan Stanley EAFE(Registered) Index
Russell 2000(Registered) Index
How to learn more:
Before investing, read the information in this Prospectus about the Enhanced
Deferred Annuities, Enhanced Income Annuities and Metropolitan Life Separate
Account E. Keep this Prospectus for future reference. For more information,
request a copy of the Statement of Additional Information ("SAI"), dated April
30, 1999. The SAI is considered part of this Prospectus as though it were
included in the Prospectus. The Table of Contents of the SAI appears on page
C-PPA-47 of this Prospectus. To request a free copy of the SAI or to ask
questions, write or call:
Metropolitan Life Insurance Company
Retirement & Savings Center, Area 2H
One Madison Avenue
New York, NY 10010-3690
Attention: Alan DeMichele
Phone: (800) 553-4459
The Securities and Exchange Commission has a website (http://www.sec.gov)
which you may visit to view this Prospectus, SAI and other information. The
Securities and Exchange Commission has not approved or disapproved these
securities or determined if this Prospectus is truthful or complete. Any
representation otherwise is a criminal offense.
The current Metropolitan Fund Prospectus is attached to the back of this
Prospectus. You should also read the Metropolitan Fund Prospectus carefully
before purchasing a Enhanced Deferred Annuity or Enhanced Income Annuity. This
Prospectus is not valid unless attached to a Metropolitan Fund Prospectus.
Enhanced Deferred Annuities Available for Purchase:
o Non-Qualified
o Traditional IRA
o Unallocated Keogh
Enhanced Income Annuities Available:
o Non-Qualified
o Traditional IRA
o Unallocated Keogh
A word about investment risk:
An investment in any of these variable annuities involves investment risk. You
could lose money you invest. Money invested is NOT:
o a bank deposit or obligation;
o federally insured or guaranteed; or
o endorsed by any bank or other financial institution.
- --------------------------------------------------------------------------------
[LOGO OF METROPOLITAN LIFE INSURANCE COMPANY]
<PAGE>
TABLE OF CONTENTS
Important Terms You Should Know .................................... C-PPA-4
Table of Expenses .................................................. C-PPA-6
Accumulation Unit Values Table ..................................... C-PPA-9
MetLife ............................................................ C-PPA-13
Metropolitan Life Separate Account E ............................... C-PPA-13
The Variable Annuities in this Prospectus .......................... C-PPA-13
An Enhanced Deferred Annuity .................................. C-PPA-14
An Enhanced Income Annuity .................................... C-PPA-14
Your Investment Choices ............................................ C-PPA-15
Enhanced Deferred Annuities ........................................ C-PPA-16
The Enhanced Deferred Annuity and Your Retirement Plan ........ C-PPA-17
Automated Investment Strategies ............................... C-PPA-17
Purchase Payments ............................................. C-PPA-18
Allocation of Purchase Payments ............................. C-PPA-18
Automated Purchase Payments ................................. C-PPA-18
Limits on Purchase Payments ................................. C-PPA-19
The Value of Your Investment .................................. C-PPA-19
Transfers ..................................................... C-PPA-20
Access to Your Money .......................................... C-PPA-21
Systematic Withdrawal Program ............................... C-PPA-21
Minimum Distribution ........................................ C-PPA-22
Contract Fee .................................................. C-PPA-23
Charges ....................................................... C-PPA-23
Insurance-Related Charge .................................... C-PPA-23
Investment-Related Charge ................................... C-PPA-23
Annuity Taxes ................................................. C-PPA-23
Early Withdrawal Charges ...................................... C-PPA-24
When No Early Withdrawal Charge Applies ..................... C-PPA-25
When Another Early Withdrawal Charge May Apply .............. C-PPA-27
Free Look ..................................................... C-PPA-28
Death Benefit ................................................. C-PPA-28
Pay-out Options (or Income Options) ........................... C-PPA-29
C-PPA-2
<PAGE>
Enhanced Income Annuities .......................................... C-PPA-30
Income Payment Types .......................................... C-PPA-31
Purchasing an Enhanced Income Annuity ......................... C-PPA-32
Allocation of Your Purchase Payment ........................... C-PPA-32
The Value of Your Income Payments ............................. C-PPA-32
Transfers ..................................................... C-PPA-33
Contract Fee .................................................. C-PPA-33
Charges ....................................................... C-PPA-33
Insurance-Related Charge .................................... C-PPA-33
Investment-Related Charge ................................... C-PPA-34
Annuity Taxes ................................................. C-PPA-34
Free Look ..................................................... C-PPA-34
General Information ................................................ C-PPA-34
Administration ................................................ C-PPA-34
Purchase Payments ........................................... C-PPA-34
Confirming Transactions ..................................... C-PPA-35
Transactions by Telephone ................................... C-PPA-35
Processing of Certain Transactions .......................... C-PPA-36
Valuation ................................................... C-PPA-36
Advertising Performance ....................................... C-PPA-36
Changes to Your Enhanced Deferred Annuity or
Enhanced Income Annuity ..................................... C-PPA-37
Voting Rights ................................................. C-PPA-38
Who Sells the Enhanced Deferred Annuities and
Enhanced Income Annuities ................................... C-PPA-39
Financial Statements .......................................... C-PPA-39
Your Spouse's Rights .......................................... C-PPA-39
When We Can Cancel Your Enhanced Deferred Annuity or
Enhanced Income Annuity ..................................... C-PPA-40
Income Taxes ....................................................... C-PPA-40
Table of Contents of the Statement of Additional Information ....... C-PPA-47
Appendix for Annuity Tax Table ..................................... C-PPA-48
MetLife does not intend to offer the Enhanced Deferred Annuities or Enhanced
Income Annuities anywhere they may not lawfully be offered and sold. MetLife
has not authorized any information or representations about the Enhanced
Deferred Annuities or Enhanced Income Annuities other than the information in
this Prospectus, the attached prospectus, supplements to the prospectuses or
any supplemental sales material we authorize.
C-PPA-3
<PAGE>
Important Terms You Should Know
Account Balance
When you purchase an Enhanced Deferred Annuity an account is set up for you.
Your Account Balance is the total amount of money credited to you under your
Deferred Annuity including money in the investment divisions of the Separate
Account and the Fixed Interest Account.
Accumulation Unit Value
Under an Enhanced Deferred Annuity, money paid-in or transferred into an
investment division of the Separate Account is credited to you in the form of
accumulation units. Accumulation units are established for each investment
division. We determine the value of these accumulation units each day the New
York Stock Exchange is open for regular trading. The values increase or
decrease based on the investment performance of the corresponding underlying
portfolios.
Annuity Unit Value
Under an Enhanced Income Annuity or variable payout option, the money paid-in
or transferred into an investment division of the Separate Account is held in
the form of annuity units. Annuity units are established for each investment
division. We determine the value of these annuity units each day the New York
Stock Exchange is open for regular trading. The values increase or decrease
based on the investment performance of the corresponding underlying
portfolios.
Assumed Investment Return (AIR)
Under an Enhanced Income Annuity, the AIR is a percentage rate of return
assumed to determine the amount of the first variable income payment. The AIR
is also the benchmark that is used to calculate the investment performance of
a given investment division to determine all subsequent payments to you.
Contract
A contract is the legal agreement between MetLife or the certificate under a
group annuity contract between MetLife and your employer, plan trustee or
other entity. You as the participant or annuitant receive a certificate under
the Contract. The contract contains relevant provisions of your Enhanced
Deferred Annuity or Enhanced Income Annuity. MetLife issues contracts for each
of the annuities described in this Prospectus.
Contract Year
Generally, the Contract Year for an Enhanced Deferred Annuity is the period
ending on the last day of the month in which the anniversary of when we issue
the annuity occurs and each following 12 month period. However, for the
unallocated Keogh Enhanced Deferred Annuity depending on underwriting and plan
requirements, the first Contract Year may range from the initial
C-PPA-4
<PAGE>
three to 15 month period after the contract is issued.
Early Withdrawal Charge
The early withdrawal charge is the amount we deduct from your Account Balance
in addition to your requested withdrawal amount if you withdraw money
prematurely from an Enhanced Deferred Annuity. This charge is often referred
to as a deferred sales load or back-end load.
Investment Division
Investment divisions are subdivisions of the Separate Account. When you
allocate or transfer money to an investment division, the investment division
purchases shares of a portfolio (with the same name) within the Metropolitan
Fund.
MetLife
Metropolitan Life Insurance Company is the company that issues the Enhanced
Deferred Annuities and Enhanced Income Annuities. Throughout this Prospectus,
MetLife is also referred to as "we," "us" or "our."
MetLife Designated Office
The MetLife Designated Office is the MetLife office that will generally handle
the processing of all your requests concerning your Enhanced Deferred Annuity
or Enhanced Income Annuity. MetLife will notify you and provide you with the
address of your MetLife Designated Office.
Separate Account
A separate account is an investment account. All assets contributed to
investment divisions under the Enhanced Deferred Annuities and Enhanced Income
Annuities are pooled in the Separate Account and maintained for the benefit of
investors in Enhanced Deferred Annuities and Enhanced Income Annuities.
You
In this Prospectus, depending on the context, "you" may mean either the
purchaser of the Deferred Annuity or Income Annuity or the participant or
annuitant for whom money is invested under group arrangements. In cases where
we are referring to giving instructions or making payments to us for the
unallocated Keogh Enhanced Deferred Annuity, "you" means the trustee of the
Keogh plan.
Variable Annuity
An annuity in which returns/income payments are based upon the performance of
investments such as stocks and bonds held by one or more underlying
portfolios. You assume the investment risk for any amounts allocated to the
investment divisions in a variable annuity.
C-PPA-5
<PAGE>
TABLE OF EXPENSES--PREFERENCE PLUS ENHANCED DEFERRED ANNUITIES
AND ENHANCED INCOME ANNUITIES
The following table shows the Separate Account and Metropolitan Fund charges
and expenses you will incur. The table is based on past experience and is
subject to change. It is not intended to show your actual expenses which may
be higher or lower. The table does not show fees for the Fixed Interest
Account or the impact of annuity taxes. We have provided examples to show you
the impact of Separate Account and Metropolitan Fund charges and expenses on a
hypothetical investment of $1,000 that has an assumed 5% return on the
investment.
- --------------------------------------------------------------------------------
Separate Account and Metropolitan Fund expenses
for the fiscal year ending December 31, 1998:
Contractowner Transaction Expenses For All Investment Divisions
Currently Offered
Sales Load Imposed on Purchases ............................. None
Deferred Sales Load (as a percentage of the purchase payment
funding the withdrawal during the accumulation period)(1) ... From 0% to 7%
Exchange Fee ............................................... None
Surrender Fee .............................................. None
Annual Contract Fee (2) ....................................... None
Separate Account Annual Expenses (as a percentage of average
account value) (3) ...........................................
General Administrative Expenses Charge ..................... .20%
Mortality and Expense Risk Charge .......................... .75%
Total Separate Account Annual Expenses ..................... .95%
Metropolitan Fund Annual Expenses
(as a percentage of average net assets) ......................
OTHER EXPENSES
Metropolitan Fund Annual Expenses MANAGEMENT AFTER EXPENSE
(as a percentage of average net assets) FEES REIMBURSEMENT TOTAL
- --------------------------------------------------------------------------------
State Street Research Aggressive Growth
Portfolio (4)(5) .............................
State Street Research Diversified
Portfolio (4)(5) .............................
State Street Research Growth Portfolio (4)(5)..
State Street Research Income Portfolio (4)(5)..
Harris Oakmark Large Cap Value
Portfolio (5)(7) .............................
Janus Mid Cap Portfolio (5)(6) ................
Loomis Sayles High Yield Bond Portfolio (6) ...
Neuberger&Berman Partners Mid Cap Value
Portfolio (5)(7) .............................
Santander International Stock
Portfolio (4)(5) .............................
Scudder Global Equity Portfolio (5)(6) ........
T. Rowe Price Large Cap Growth
Portfolio (5)(7) .............................
T. Rowe Price Small Cap Growth
Portfolio (5)(6) .............................
Lehman Brothers Aggregate Bond Index
Portfolio (7).................................
MetLife Stock Index Portfolio (4) .............
Morgan Stanley EAFE(Registered) Index
Portfolio (7) ................................
Russell 2000 Index Portfolio (7) ..............
C-PPA-6
<PAGE>
Example
If you surrender your Enhanced Deferred Annuity (withdraw all your money) at
the end of the time periods listed below, you would pay the following expenses
on a $1,000 investment in each investment division listed below, assuming a 5%
annual return on assets:
<TABLE>
<CAPTION>
1 3 5 10
YEAR YEARS YEARS YEARS
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
State Street Research Aggressive Growth Portfolio .....................
State Street Research Diversified Portfolio ...........................
State Street Research Growth Portfolio ................................
State Street Research Income Portfolio ................................
Harris Oakmark Large Cap Value Portfolio ..............................
Janus Mid Cap Portfolio ...............................................
Loomis Sayles High Yield Bond Portfolio ...............................
Neuberger&Berman Partners Mid Cap Value Portfolio .....................
Santander International Stock Portfolio ...............................
Scudder Global Equity Portfolio .......................................
T. Rowe Price Large Cap Growth Portfolio ..............................
T. Rowe Price Small Cap Growth Portfolio ..............................
Lehman Brothers Aggregate Bond Index Portfolio ........................
MetLife Stock Index Portfolio .........................................
Morgan Stanley EAFE(Registered) Index Portfolio .......................
Russell 2000 Index Portfolio ..........................................
</TABLE>
If you annuitize (elect a pay-out option under your Enhanced Deferred Annuity)
or do not surrender your Enhanced Deferred Annuity at the end of the time
periods listed below, you would pay the following expenses on a $1,000
investment in each investment division listed below, assuming a 5% annual
return on assets (8):
<TABLE>
<CAPTION>
1 3 5 10
YEAR YEARS YEARS YEARS
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
State Street Research Aggressive Growth Portfolio .....................
State Street Research Diversified Portfolio ...........................
State Street Research Growth Portfolio ................................
State Street Research Income Portfolio ................................
Harris Oakmark Large Cap Value Portfolio ..............................
Janus Mid Cap Portfolio ...............................................
Loomis Sayles High Yield Bond Portfolio ...............................
Neuberger&Berman Partners Mid Cap Value Portfolio .....................
Santander International Stock Portfolio ...............................
Scudder Global Equity Portfolio .......................................
T. Rowe Price Large Cap Growth Portfolio ..............................
T. Rowe Price Small Cap Growth Portfolio ..............................
Lehman Brothers Aggregate Bond Index Portfolio ........................
MetLife Stock Index Portfolio .........................................
Morgan Stanley EAFE(Registered) Index Portfolio .......................
Russell 2000 Index Portfolio ..........................................
</TABLE>
C-PPA-7
<PAGE>
TABLE OF EXPENSES (continued)
(1) There are times when the early withdrawal charge does not apply to amounts
that are withdrawn from an Enhanced Deferred Annuity. Each Contract Year
you may take the greater of 10% (20% under certain Enhanced Deferred
Annuities) of your Account Balance or your purchase payments made over 7
years ago free of early withdrawal charges.
(2) A $20 annual contract fee may be imposed on money in the Fixed Interest
Account. This fee may be waived under certain circumstances.
(3) Our total Separate Account Annual Expenses will not exceed .95% of your
average balance in the investment divisions. For purposes of presentation
here, we estimated the allocation between general administrative expenses
and the mortality and expense risk charge.
(4) Prior to May 16, 1993, we paid all expenses of the Metropolitan Fund (other
than management fees, brokerage commissions, taxes, interest and
extraordinary or non-recurring expenses).
(5) We anticipate that the marginal rate of the investment management fee for
the Portfolio will decrease when the size of the Portfolio reaches certain
pre-established dollar levels.
(6) These Portfolios began operations on March 3, 1997. We paid all expenses
(other than management fees, brokerage commissions, taxes, interest and
extraordinary or non-recurring expenses) in excess of .20% of the average
net assets for each of the following Portfolios until the Portfolio's
total assets reached $100 million, or until March 2, 1999, whichever came
first:
OTHER EXPENSES DATE
WITHOUT REIMBURSEMENT
REIMBURSEMENT STOPPED
- --------------------------------------------------------------------------------
Loomis Sayles High Yield Bond
T. Rowe Price Small Cap Growth January 23, 1998
Janus Mid Cap December 31, 1997
Scudder Global Equity July 1, 1998
If we had not reimbursed the Portfolios for these expenses, the "other
expenses" for the Portfolios would have been those listed above.
(7) These Portfolios began operations on November 9, 1998. We pay all expenses
(other than management fees, brokerage commissions, taxes, interest and
extraordinary or non-recurring expenses) in excess of .20% (.25% for the
Morgan Stanley EAFE(Registered) Index Portfolio) of the average net assets
for each of the following Portfolios until the Portfolio's total assets
reach $100 million, or until November 8, 2000, whichever comes first:
OTHER EXPENSES
WITHOUT
REIMBURSEMENT
- --------------------------------------------------------------------------------
Harris Oakmark Large Cap Value
Lehman Brothers Aggregate Bond Index
Neuberger&Berman Partners Mid Cap Value
Russell 2000 Index
T. Rowe Price Large Cap Growth Portfolio
Morgan Stanley "EAFE" Index
(8) If we had not reimbursed the Portfolios for these expenses, the "other
expenses" for the Portfolios would have been those listed above.
(9) The income option you choose when you decide to exercise a pay-out option
under your Deferred Annuity must be a life annuity or have scheduled
payments for a period of at least five years to avoid the early withdrawal
charge.
In 1998, the Separate Account annual expenses we received for all Separate
Account annuities was $______ .
C-PPA-8
<PAGE>
ACCUMULATION UNIT VALUES FOR EACH INVESTMENT DIVISION
(For an accumulation unit outstanding throughout the period)
These tables and bar charts show fluctuations in the Accumulation Unit Values
for each investment division from year end to year end. The information in
this table has been derived from the Separate Account's full financial
statements or other reports (such as the annual report). The financial
statements are audited annually by Deloitte & Touche LLP, who are independent
auditors. The full financial statements and related notes appear in the SAI.
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------------
NUMBER OF
BEGINNING OF YEAR END OF YEAR ACCUMULATION
ACCUMULATION ACCUMULATION UNITS END OF YEAR
ENHANCED PREFERENCE PLUS CONTRACTS YEAR UNIT VALUE UNIT VALUE (IN THOUSANDS)
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
State Street Research Aggressive Growth Division .................. 1998 $38.02
1997 35.98 38.02 340
[YEAR END ACCUMULATION UNIT VALUE 1996 33.72 35.98 341
BAR CHARTS OMITTED FOR THIS DIVISION 1995 26.29 33.72 254
AND EACH OF THE 10 FOLLOWING DIVISIONS] 1994 27.05 26.29 189
1993 22.26 27.05 163
1992 20.37 22.26 1
1991 12.35 20.37 0
1990 14.85 (a) 12.35 0
State Street Research Diversified Division ........................ 1998 33.57
1997 28.11 33.57 390
1996 24.78 28.11 371
1995 19.69 24.78 346
1994 20.51 19.69 341
1993 18.36 20.51 360
1992 16.93 18.36 50
1991 13.68 16.93 0
1990 14.34 (a) 13.68 0
</TABLE>
C-PPA-9
<PAGE>
ACCUMULATION UNIT VALUES (continued)
(For an accumulation unit outstanding throughout the period)
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------------
NUMBER OF
BEGINNING OF YEAR END OF YEAR ACCUMULATION
ACCUMULATION ACCUMULATION UNITS END OF YEAR
ENHANCED PREFERENCE PLUS CONTRACTS YEAR UNIT VALUE UNIT VALUE (IN THOUSANDS)
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
State Street Research Growth Division ............................. 1998 $60.00
1997 47.19 60.00 443
1996 38.99 47.19 402
1995 29.57 38.99 334
1994 30.85 29.57 296
1993 27.22 30.85 258
1992 24.63 27.22 5
1991 18.67 24.63 0
1990 21.66(a) 18.67 0
State Street Research Income Division ............................. 1998 32.77
1997 30.13 32.77 139
1996 29.36 30.13 128
1995 24.79 29.36 123
1994 25.83 24.79 125
1993 23.43 25.83 151
1992 22.12 23.43 0
1991 19.02 22.12 0
1990 17.91(a) 19.02 0
Janus Mid Cap Division ............................................ 1998 12.72
1997 10.00(b) 12.72 54
Loomis Sayles High Yield Bond Division ............................ 1998 10.53
1997 10.00(b) 10.53 15
</TABLE>
C-PPA-10
<PAGE>
ACCUMULATION UNIT VALUES (continued)
(For an accumulation unit outstanding throughout the period)
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------------
NUMBER OF
BEGINNING OF YEAR END OF YEAR ACCUMULATION
ACCUMULATION ACCUMULATION UNITS END OF YEAR
ENHANCED PREFERENCE PLUS CONTRACTS YEAR UNIT VALUE UNIT VALUE (IN THOUSANDS)
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Santander International Stock Division ............................ 1998 $13.54
1997 13.99 13.54 324
1996 14.38 13.99 368
1995 14.40 14.38 396
1994 13.84 14.40 446
1993 9.45 13.84 339
1992 10.63 9.45 1
1991 10.00(c) 10.63
Scudder Global Equity Division .................................... 1998 10.88
1997 10.00(b) 10.88 62
T. Rowe Price Small Cap Growth Division ........................... 1998 11.79
1997 10.00(b) 11.79 85
MetLife Stock Index Division ...................................... 1998 32.50
1997 24.83 32.50 701
1996 20.44 24.83 629
1995 15.07 20.44 518
1994 15.04 15.07 432
1993 13.86 15.04 399
1992 13.02 13.86 12
1991 10.13 13.02 0
1990 10.85(a) 10.13 0
</TABLE>
C-PPA-11
<PAGE>
ACCUMULATION UNIT VALUES (continued)
(For an accumulation unit outstanding throughout the period)
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------------
NUMBER OF
BEGINNING OF YEAR END OF YEAR ACCUMULATION
ACCUMULATION ACCUMULATION UNITS END OF YEAR
PREFERENCE PLUS ENHANCED DEFERRED ANNUITIES YEAR UNIT VALUE UNIT VALUE (IN THOUSANDS)
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Harris Oakmark Large Cap Value Division 1998 $10.00(d)
Lehman Brothers Aggregate Bond Division 1998 10.00(d)
Morgan Stanley EAFE(Registered) Index Division 1998 10.00(d)
Neuberger&Berman Partners Mid Cap Value Division 1998 10.00(d)
Russell 2000 Index Division 1998 10.00(d)
T. Rowe Price Large Cap Growth Division 1998 10.00(d)
</TABLE>
- -------------
In addition to the above mentioned Accumulation Units, there were cash
reserves of $ as of December 31, 1998, applicable to Income Annuities
(including those not described in this Prospectus) receiving annuity payouts.
(a) Inception Date July 2, 1990.
(b) Inception Date March 3, 1997.
(c) Inception Date July 1, 1991.
(d) Inception Date November 9, 1998. A bar chart does not appear for this
investment division because there is less than one calendar year of
performance history.
C-PPA-12
<PAGE>
MetLife
Our main office is located at One Madison Avenue, New York, New York 10010.
Headquartered in New York City since 1868, MetLife is one of the world's
largest financial services companies and a leader in life insurance sales in
the United States. With approximately $ billion worth of assets under
management as of December 31, 1998, MetLife serves 37 million people around
the world and manages pension plans of many Fortune 500 companies. The more
than 41,000 associates in the MetLife family provide or administer life,
health and property/casualty insurance, annuities, mutual funds as well as
other kinds of savings, retirement and financial products and services for
individuals and groups.
We are a mutual life insurance company. In November 1998, MetLife announced
its intention to convert to a stock company from a mutual company. MetLife's
board of directors authorized the development of a plan to "demutualize." The
plan will be subject to approval by the board of directors, the State of New
York Insurance Department and policyholders. As of April 30,1999, we do not
know the details of the plan or when or if it will take effect.
Metropolitan Life Separate Account E
We established Metropolitan Life Separate Account E on September 27, 1983. The
purpose of the Separate Account is to hold the variable assets that underlie
the Preference Plus Account Variable Enhanced Annuity Contracts and some other
variable annuity contracts we issue. We have registered the Separate Account
with the Securities and Exchange Commission as a unit investment trust under
the Investment Company Act of 1940.
The Separate Account's assets are solely for the benefit of those who invest
in the Separate Account and no one else, including our creditors. We are
obligated to pay all money we owe under the Enhanced Deferred Annuities and
Enhanced Income Annuities even if that amount exceeds the assets in the
Separate Account. The assets of the Separate Account are held in our name on
behalf of the Separate Account and legally belong to us. All the income,
gains, and losses (realized or unrealized) resulting from these assets are
credited to or charged against the contracts issued from this Separate Account
without regard to our other business.
The Variable Annuities in this Prospectus
There are two types of variable annuities described in this Prospectus:
Enhanced Deferred Annuities and Enhanced Income Annuities. These annuities are
"variable" because the value of your account or income
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The group Deferred Annuities and group Income Annuities described in this
prospectus are offered to an employer, association, trust or other group for
its employees, members or participants.
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payment varies based on the investment performance of the investment divisions
you choose. In short, the value of your Enhanced Deferred Annuity, your income
payments under a variable pay-out option of your Enhanced Deferred Annuity, or
your income payments under your Enhanced Income Annuity, may go up or down.
Since the investment performance is not guaranteed, your money is at risk. The
degree of risk will depend on the investment divisions you select. The
Accumulation Unit Value or Annuity Unit Value for each investment division
rises or falls based on the investment performance (or "experience") of the
Portfolio with the same name.
The Enhanced Deferred Annuities have a fixed interest rate option called the
Fixed Interest Account. With the Fixed Interest Account, your money earns a
rate of interest that we guarantee. Enhanced Income Annuities and the variable
pay-out options under the Enhanced Deferred Annuities have a fixed payment
option called the Fixed Income Option. Under the Fixed Income Option, we
guarantee the amount of your fixed income payments. These fixed options are
not described in this Prospectus although we occasionally refer to them.
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An Enhanced Deferred Annuity consists of two phases: the accumulation or
"pay-in" phase and the income annuity or "pay-out" phase.
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An Enhanced Deferred Annuity
You accumulate money in your account during the pay-in phase by making one or
more purchase payments. MetLife will hold your money and credit any investment
returns as long as the money remains in your account.
The pay-out phase begins when you either take all of your money out of the
account or elect to have us pay you "income" payments using the money in your
account. The number and the amount of the income payments you receive will
depend on such things as the type of pay-out option you choose, your
investment choices, and the amount used to provide your income payments.
Because Enhanced Deferred Annuities offer various insurance benefits such as
of pay-out options, including our guarantee of income for your lifetime, they
are "annuities."
An Enhanced Income Annuity
An Enhanced Income Annuity, also known as an immediate annuity, only has a
"pay-out" phase. You make a single purchase payment and select the type of
pay-out option suited to your needs. Some of the pay-out options guarantee an
income stream for your lifetime or your and another's lifetimes. Some Enhanced
Income Annuities guarantee a time period of your choice over which MetLife
will make income payments. Income Annuities also have other features. The
amount of your income payments you receive will depend on such things as the
type of pay-out option you choose, your investment choices and the amount of
your purchase payment.
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Your Investment Choices
The investment choices are:
Lehman Brothers Aggregate Bond Index Portfolio
State Street Research Income Portfolio
State Street Research Diversified Portfolio
MetLife Stock Index Portfolio
Harris Oakmark Large Cap Value Portfolio
T. Rowe Price Large Cap Growth Portfolio
State Street Research Growth Portfolio
Neuberger&Berman Partners Mid Cap Value Portfolio
Janus Mid Cap Portfolio
Loomis Sayles High Yield Bond Portfolio
State Street Research Aggressive Growth Portfolio
Russell 2000 Index Portfolio
T. Rowe Price Small Cap Growth Portfolio
Scudder Global Equity Portfolio
Morgan Stanley EAFE(Registered) Index Portfolio
Santander International Stock Portfolio
Some of the investment choices may not be available under the terms of the
Enhanced Deferred Annuity or Enhanced Income Annuity. The contract will
indicate the investment divisions that are available to you. Your investment
choices may be limited because:
o Some of the investment divisions are not approved in your state.
o Your employer, association or other group contractholder limits the
number of available investment divisions.
o We have restricted the available investment divisions.
o For Enhanced Income Annuities, some states limit you to four choices
(four investment divisions or three investment divisions and the Fixed
Income Option).
The investment divisions buy and sell shares of corresponding mutual fund
portfolios. These Portfolios, which are part of the Metropolitan Fund, invest
in stocks, bonds and other investments. All dividends declared by the
Portfolios are earned by the Separate Account and reinvested. Therefore, no
dividends are distributed to you under the Enhanced Deferred Annuities or
Enhanced Income Annuities. Dividends generally are reflected in an increase in
the Accumulation or Annuity Unit Value. You pay no transaction expenses (i.e.,
front end or back-end load sales charges) as a result of the
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The degree of investment risk you assume will depend on the investment
divisions you choose. We have listed your choices in order of risk from the
most conservative to the most aggressive.
There is a possibility you will lose principal in the investment choices.
However, they generally offer the opportunity for greater returns over the
long term than our guaranteed fixed options.
While the investment divisions and their comparably named Portfolios may have
names, investment objectives and management which are identical or similar to
publicly available mutual funds, these are not those mutual funds. The
Metropolitan Fund Portfolios most likely will not have the same performance
experience as any publicly available mutual fund.
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Separate Account's purchase or sale of these mutual fund shares. The
Portfolios of the Metropolitan Fund are available only by purchasing MetLife
annuities and life insurance policies and are never sold directly to the
public.
The Metropolitan Fund is a "series" type fund registered with the Securities
and Exchange Commission as an "open-end management investment company" under
the Investment Company Act of 1940 (the "1940 Act"). A "series" fund means
that each Portfolio is one of several available through the Metropolitan Fund.
Except for the Janus Mid Cap Portfolio, each Portfolio is "diversified" under
the 1940 Act.
The Metropolitan Fund and each Portfolio are more fully described in the
Metropolitan Fund's prospectus and its SAI. The Metropolitan Fund's prospectus
is attached at the end of this Prospectus. The SAI is available upon your
request.
The Portfolios of the Metropolitan Fund pay us a monthly fee for our services
as investment manager. These fees, as well as the operating expenses paid by
each Portfolio, are described in the Metropolitan Fund prospectus and SAI.
In addition, the Metropolitan Fund prospectus discusses other separate
accounts of MetLife and Metropolitan Tower Life Insurance Company that invest
in the Metropolitan Fund. The risks of these arrangements are also discussed.
Enhanced Deferred Annuities
This Prospectus describes three kinds of Enhanced Deferred Annuities under
which you can accumulate money:
o Non-Qualified
o Traditional IRA
(Individual Retirement Annuity)
o Unallocated Keogh
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These Enhanced Deferred Annuities are issued to a group. You are then a
participant under the group's Enhanced Deferred Annuity.
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Certain group Enhanced Deferred Annuities may be issued to a bank that does
nothing but hold them as contractholder. Enhanced Deferred Annuities may be
either:
o Allocated (your Account Balance records are kept for you as an
individual); or
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o Unallocated (Account Balance records are kept for a plan or group as a
whole).
The Enhanced Deferred Annuity and Your Retirement Plan
If you participate through a retirement plan, the Enhanced Deferred Annuity
may provide that all or some of your rights as described in this Prospectus
are subject to the plan's terms. Limitations on your rights may apply to
investment choices, automated investment strategies, purchase payments,
withdrawals, transfers, the death benefit and pay-out options. The Enhanced
Deferred Annuity may provide that a plan administrative fee will be paid by
making a withdrawal from your Account Balance. We may rely on your employer's
or plan administrator's statements to us as to the terms of the plan or your
entitlement to any amounts. We will not be responsible for determining what
your plan says. You should consult the Enhanced Deferred Annuity contract and
plan document to see how you may be affected.
Automated Investment Strategies
There are five automated investment strategies available to you. However, the
investment strategies are not available for the unallocated Keogh Enhanced
Deferred Annuities. As with any investment program, no strategy can guarantee
a gain - you can lose money. We may modify or terminate any of the strategies
at any time. You may have only one automated investment strategy in effect at
a time.
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We created these investment strategies to help you manage your money. You
decide if one is appropriate for you, based upon your risk tolerance and
saving goals. These strategies were designed to help you take advantage of the
tax-deferred status of an annuity.
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The Equity Generator(Service Mark): An amount equal to the interest earned in
the Fixed Interest Account is transferred monthly to either the MetLife Stock
Index or State Street Research Aggressive Growth investment division, based on
your selection.
If you elect the Equity Generator at the time you purchase your Enhanced
Deferred Annuity and you never request allocation changes or transfers, when
you withdraw money, the early withdrawal charge will not exceed any earnings
under the Enhanced Deferred Annuity.
The Equalizer(Service Mark): Each quarter amounts are transferred between the
Fixed Interest Account and, based on your selection, either the MetLife Stock
Index or State Street Research Aggressive Growth investment division to make
the value of each equal.
The Rebalancer(Service Mark): You select a specific asset allocation from
among the investment divisions and the Fixed Interest Account. Each quarter,
we transfer amounts among these options to bring the percentage of your
Account Balance in each option back to your original allocation.
The Index Selector(Service Mark): You may select one of five asset allocation
models which are designed to correlate to various risk tolerance levels. Based
on the model you choose, your Account Balance is divided among the Lehman
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Brothers Aggregate Bond Index, MetLife Stock Index, Morgan Stanley
EAFE(Registered) Index and Russell 2000 Index investment divisions and the
Fixed Interest Account. Each quarter, the percentage in each of these
investment divisions and the Fixed Interest Account is brought back to the
original percentage by transferring amounts among the investment divisions and
the Fixed Interest Account.
In the future, we may permit you to allocate less than 100% of your Account
Balance to this strategy. This strategy may experience more volatility than
our other strategies. The models are subject to change from time to time. We
provide the elements to formulate the models. We may rely on a third party for
its expertise in creating appropriate allocations.
The Allocator(Service Mark): Each month a dollar amount you choose is
transferred from the Fixed Interest Account to any of the investment divisions
you choose. You select the day of the month and the number of months over
which the transfers will occur. A minimum transfer of $50 is the only
requirement.
The Equity Generator and the Allocator are dollar cost averaging strategies.
Dollar cost averaging involves investing at regular intervals of time. Since
this involves continuously investing regardless of fluctuating prices, you
should consider whether you can continue the strategy through periods of
fluctuating prices.
Purchase Payments
There is no minimum purchase payment except for the unallocated Keogh Enhanced
Deferred Annuity. If you have an unallocated Keogh Enhanced Deferred Annuity,
each purchase payment must be at least $2,000. In addition, your total
purchase payments must be at least $15,000 for the first Contract Year and at
least $5,000 each subsequent Contract Year.
You may continue to make purchase payments while you receive Systematic
Withdrawal Program payments, as described later in this Prospectus, unless
your purchase payments are made through automatic payroll deduction,
check-o-matic, salary reduction or salary deduction.
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You may make purchase payments to your Enhanced Deferred Annuity whenever you
choose, up to the date you begin receiving payments from a pay-out option.
However, Federal tax rules may limit the amount and frequency of your purchase
payments.
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Allocation of Purchase Payments
You decide how your money is allocated among the Fixed Interest Account and
the investment divisions. You can change your allocations for additional
purchase payments. We will make allocation changes when we receive your
request for a change. You may also specify an effective date for the change as
long as it is within 30 days after we receive the request.
Automated Purchase Payments
If you purchase a Non-Qualified Enhanced Deferred Annuity, you may elect to
have purchase payments made automatically. With "automatic payroll deduction"
your employer deducts in amount from your salary and makes the purchase
payment for you. With "check-o-matic" your bank deducts money from your
checking account and makes the purchase payment for you.
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Limits on Purchase Payments
Your ability to make purchase payments may be limited by:
o Federal tax laws.
o Our right to limit the total of your purchase payments to $500,000. For
the unallocated Keogh Enhanced Deferred Annuity, we limit purchase
payments to $5,000,000 per year. We may change the maximum by telling
you in writing at least 90 days in advance.
o Regulatory requirements. For example, if you reside in Washington or
Oregon, we may be required to limit your ability to make purchase
payments after you have held the Enhanced Deferred Annuity for more than
three years, if the Enhanced Deferred Annuity was issued to you after
you were age 60, or after you turn age 63, if the Enhanced Deferred
Annuity was issued before you were age 61.
o For the unallocated Keogh Enhanced Deferred Annuity, a withdrawal should
you leave your job.
o For certain Enhanced Deferred Annuities, you may no longer make purchase
payments if you retire.
o Receiving systematic termination payments (described later).
The Value of Your Investment
Accumulation Units are credited to you when you make purchase payments or
transfers into an investment division. When you withdraw or transfer money
from an investment division, accumulation units are liquidated. We determine
the number of accumulation units you have by dividing the amount of your
purchase payment, transfer or withdrawal by the Accumulation Unit Value on the
date of the transaction.
This is how we calculate the Accumulation Unit Value for each investment
division:
o First, we determine the change in investment performance (including any
investment-related charge) for the underlying Portfolio from the
previous trading day to the current trading day;
o Next, we subtract the daily equivalent of our insurance-related charge
(general administrative expenses and mortality and expense risk charges)
for each day since the last Accumulation Unit Value was calculated; and
o Finally, we multiply the previous Accumulation Unit Value by this result.
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Examples
Calculating the Number of Accumulation Units
Assume you make a purchase payment of $500 into one investment division and
that investment division's Accumulation Unit Value is currently $10.00. You
would be credited with 50 accumulation units.
$500/2 = 50 accumulation units
Calculating the Accumulation Unit Value
Assume yesterday's Accumulation Unit Value was $10.00 and the number we
calculate for today's investment experience (minus charges) for an underlying
portfolio is 1.05. Today's Accumulation Unit Value is $10.50. The value of
your $500 investment is then $525.
$10.00 x 1.05 = $10.50 is the new Accumulation Unit Value
However, assume that today's investment experience (minus charges) is .95
instead of 1.05. Today's Accumulation Unit Value is $9.50. The value of your
$500 investment is then $475.
$10.00 x .95 = $9.50 is the new Accumulation Unit Value
Transfers
You can make an unlimited number of transfers between investment divisions or
between the investment divisions and the Fixed Interest Account. Some
restrictions may apply to transfers from the Fixed Interest Account to the
investment divisions. For us to process a transfer, you must tell us:
o The percentage or dollar amount of the transfer;
o The investment division (or Fixed Interest Account) from which you want
the money to be transferred;
o The investment division (or Fixed Interest Account) to which you want
the money to be transferred; and
o Whether you intend to start, stop or modify an automated investment
strategy by making the transfer.
We may require you to:
o Use our forms;
o Maintain a minimum Account Balance (if the transfer is in connection
with an automated investment strategy); or
o Transfer a minimum amount if the transfer is in connection with the
Allocator.
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You may transfer money within your contract as often as you like without
incurring current taxes on your earnings.
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Access To Your Money
You may withdraw either all or a part of your Account Balance from the
Enhanced Deferred Annuity. Withdrawals must be at least $500 (or the Account
Balance, if less). To process your request, we need the following information:
o The percentage or dollar amount of the withdrawal; and
o The investment division (or Fixed Interest Account) from which you want
the money to be withdrawn.
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Income taxes, tax penalties and early withdrawal charges may apply to any
withdrawal you make.
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If you request, generally you can tell us to make payments directly to other
investments on a tax-free basis. You may only do so if all applicable tax and
state regulatory requirements are met and we receive all information necessary
for us to make the payment. We may require you to use our forms.
Systematic Withdrawal Program
If you have a Non-Qualified or IRA Enhanced Deferred Annuity, subject to
approval in your state, you may choose to automatically withdraw a specific
dollar amount or a percentage of your Account Balance each Contract Year. This
amount is then paid in equal portions throughout the Contract Year according
to the time frame you select, e.g., monthly, quarterly, semi-annually or
annually. Once the Systemic Withdrawal Program is initiated, the payments will
automatically renew each Contract Year.
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Depending on the Enhanced Non-Qualified or Enhanced IRA Deferred Annuity, we
will withdraw the payments from the Fixed Interest Account or the investment
divisions you select either pro rata or in the proportions you request. Each
payment must be at least $50.
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If you elect to withdraw a dollar amount, we will pay you the dollar amount
each Contract Year. If you elect to withdraw a percentage of your Account
Balance, each Contract Year we recalculate the dollar amount you will receive
based on your new Account Balance.
Calculating Your Payment Based on a Percentage Election for the First Contract
Year You Elect the Systematic Withdrawal Program: If you choose to receive a
percentage of your Account Balance, we will determine the dollar amount
payable on the date these payments begin. When you first elect the program, we
will pay this dollar amount over the remainder of the Contract Year. For
example, if you select to receive payments on a monthly basis, the percentage
of your Account Balance you request equals $12,000, and there are six months
left in the Contract Year, we will pay you $2,000 a month.
Calculating Your Payment for Subsequent Contract Years of the Systematic
Withdrawal Program: For each subsequent year that your Systematic Withdrawal
Program remains in effect, we will deduct from your Enhanced Deferred Annuity
and pay you over the Contract Year either the dollar amount that you chose or
a dollar amount equal to the percentage of your Account Balance you chose. For
example, if you select to receive payments on a monthly basis, ask for a
percentage and that percentage equals another $12,000 at the start of a
Contract Year, we will pay you $1,000 a month.
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If you do not provide us with your desired allocation, or there are
insufficient amounts in the investment divisions or the Fixed Interest Account
that you selected, the payments will be taken out pro rata from the Fixed
Interest Account and any investment divisions in which you then have money.
Selecting a Payment Date: Your payment date is the date we make the
withdrawal. When you select or change a payment date, we must receive your
request at least 10 days prior to the selected date. If we do not receive your
request in time, we will make the payment a month after the date you selected.
If you do not select a payment date, we will automatically begin systematic
withdrawals within 30 days after we receive your request. Changes in the
dollar amount, percentage, or timing of payments can be made at the beginning
of any Contract Year, once a year. However, we must receive your request at
least 30 days in advance. If you make any of these changes we will treat your
request as though you were starting a new Systematic Withdrawal Program.
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If you would like to receive your Systematic Withdrawal payment by the first
of the month, you should request that the payment date be the 20th day of the
month.
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Although we need your written authorization to begin this program, you may
cancel this program at any time by telephone or by writing to us at your
MetLife Designated Office.
Systematic Withdrawal Program payments may be subject to an early withdrawal
charge unless an exception to this charge applies. For purposes of determining
how much of the annual payment amount is exempt from this charge under the
free withdrawal provision (discussed later), all Systematic Withdrawal Program
payments in a Contract Year are characterized as a single lump sum withdrawal
as of your first payment date in that Contract Year. When you first elect the
program, we will calculate the percentage of your Account Balance your
Systematic Withdrawal Program payment represents based on your Account Balance
on the first Systematic Withdrawal Program payment date. For all subsequent
Contract Years, we will calculate the percentage of your Account Balance your
Systematic Withdrawal Program payment represents based on your Account Balance
on the first Systematic Withdrawal Program payment date of that Contract Year.
We will determine separately the early withdrawal charge and any relevant
factors (such as applicable exceptions) for each Systematic Withdrawal Program
payment as of the date it is withdrawn from your Enhanced Deferred Annuity.
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Your Account Balance will be reduced by the amount of your Systematic
Withdrawal payments and applicable withdrawal charges. Payments under this
program are not the same as income payments you would receive from an Enhanced
Deferred Annuity pay-out option or under an Enhanced Income Annuity.
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Minimum Distribution
In order for you to comply with certain tax law provisions, you may be
required to take money out of your Enhanced Deferred Annuity. Rather than
receiving your minimum distribution in one annual lump-sum payment, you may
request that we pay it to you in installments throughout the calendar year.
However, we may require that you maintain a certain Account Balance at the
time you request these payments.
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Contract Fee
There is no Separate Account annual contract fee. You may pay a $20 annual fee
from the Fixed Interest Account at the end of each Contract Year if your
Account Balance is less than a certain amount.
Charges
There are two types of charges you pay while you have money in an investment
division:
o Insurance-related charge, and
o Investment-related charge.
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The charges you pay will not reduce the number of accumulation units credited
to you. Instead, we deduct the charges every day we calculate the Accumulation
Unit Value.
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Insurance-Related Charge
You will pay an insurance-related charge for the Separate Account that is no
more than .95% annually of the average value of the amount you have in the
Separate Account. This charge pays us for general administrative expenses and
for the mortality and expense risk of the Enhanced Deferred Annuity.
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MetLife guarantees that the Separate Account insurance-related charge will not
increase while you have an Enhanced Deferred Annuity.
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General administrative expenses we incur include financial, actuarial,
accounting, and legal expenses.
The mortality portion of the insurance-related charge pays us for the risk
that you may live longer than we estimated. Then, we could be obligated to pay
you more in payments from a pay-out option than we anticipated. Also, we bear
the risk that the guaranteed death benefit we would pay should you die during
your "pay-in" phase is larger than your Account Balance. We also bear the risk
that our expenses in administering the Enhanced Deferred Annuities may be
greater than we estimated (expense risk).
Investment-Related Charge
This charge pays us as the investment manager of the Metropolitan Fund for
managing money in the Portfolios and investment operating expenses. The
percentage you pay depends on which investment divisions you select. Amounts
for each investment division are listed in the Table of Expenses.
Annuity Taxes
Some jurisdictions tax what are called "annuity considerations." These may
apply to purchase payments, Account Balances and death benefits. In most
jurisdictions, we currently do not deduct any money from purchase payments,
Account Balances or death benefits to pay these taxes. Generally, our practice
is to deduct money to pay annuity taxes (also known as "premium" taxes) only
when you exercise a pay-out option. In certain jurisdictions, we may also
deduct money to pay annuity taxes on lump sum withdrawals or when you exercise
a pay-out option. We may deduct an
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amount to pay annuity taxes some time in the future since the laws and the
interpretation of the laws relating to annuities are subject to change.
A chart in the Appendix shows the jurisdictions where annuity taxes are
charged and the amount of these taxes.
Early Withdrawal Charges
An early withdrawal charge of up to 7% may apply if you withdraw purchase
payments within 7 years of when they were credited to your Deffered Annuity.
To determine the early withdrawal charge for Enhanced Deferred Annuities, we
treat your Fixed Interest Account and Separate Account as if they were a
single account and ignore both your actual allocations and the Fixed Interest
Account or investment division from which the withdrawal is actually coming.
To do this, we first assume that your withdrawal is from amounts (other than
earnings) that can be withdrawn without an early withdrawal charge, then from
other amounts (other than earnings) and then from earnings, each on a
"first-in-first-out" (oldest money first) basis. Once we have determined the
amount of the early withdrawal charge, we will actually withdraw it from the
Fixed Interest Account and the investment divisions in the same proportion as
the withdrawal is being made. In determining what the withdrawal charge is, we
do not include earnings, although the actual withdrawal to pay it may come
from earnings.
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You will not pay an early withdrawal charge on any purchase payments made more
than 7 years ago.
We do not include your earnings when calculating early withdrawal charges.
However, if the early withdrawal charge is greater than the rest of your
purchase payments, then we will take the early withdrawal charges, in whole or
in part, from your earnings.
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For partial withdrawals, the early withdrawal charge is determined by dividing
the amount that is subject to the early withdrawal charge by 100% minus the
applicable percentage shown in the following chart. Then we will make the
payment directed, and withdraw the early withdrawal charge.
For a full withdrawal we multiply the amount to which the withdrawal charge
applies by the percentage shown, keep the result as an early withdrawal charge
and pay you the rest. We will treat your request as a request for a full
withdrawal if your Account Balance is not sufficient to pay both the requested
withdrawal and the early withdrawal charge.
The early withdrawal charge on purchase payments withdrawn is as follows:
During Purchase Payment Year
Year 1 2 3 4 5 6 7 8 & Later
Percentage 7% 6% 5% 4% 3% 2% 1% 0
Early withdrawal charges may be waived for certain Enhanced Deferred Annuities
because we have reduced sales costs associated with them.
By law, your total early withdrawal charges applied to amounts in the
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investment divisions will never exceed 9% of all your purchase payments in the
investment divisions.
The early withdrawal charge reimburses us for our costs in selling the
Deferred Annuities. We may use our profits (if any) from the mortality and
expense risk charge to pay for our cost's to sell the Deferred Annuities which
exceed the amount of early withdrawal charges we collect. However, we believe
that our sales costs may exceed the early withdrawal charges we collect. If
so, we will pay the difference out of our general profits.
When No Early Withdrawal Charge Applies
In some cases, we will not charge you the early withdrawal charge when you
make a withdrawal. We may, however, ask you to prove that you meet any
conditions listed below.
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Early withdrawal charges never apply to transfers among investment divisions
or transfers to the Fixed Interest Account.
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You do not pay an early withdrawal charge:
o On transfers you make among the investment divisions or to the Fixed
Interest Account.
o On withdrawals of purchase payments you made over seven years ago.
o If you choose payments over one or more lifetimes or for a period of at
least five years (without the right to accelerate the payments).
o If you die during the pay-in phase. Your beneficiary will receive the
full death benefit without deduction.
o If you withdraw the permitted free withdrawal each Contract Year. This
total withdrawal may be taken in an unlimited number of partial
withdrawals during that Contract Year. Each time you make a withdrawal,
we calculate what percentage your withdrawal represents at that time.
Only when the total of these percentages exceeds the specified percentage
will you have to pay early withdrawal charges. For the unallocated Keogh
and certain other Enhanced Deferred Annuities, generally you are allowed
to take the "free withdrawal" on top of any other withdrawals which are
otherwise exempt from the early withdrawal charge. This is not true if
your other withdrawals are in connection with a systematic termination or
purchase payments made over 7 years ago.
The percentage of your Account Balance you are permitted without an early
withdrawal charge is for:
o Unallocated Keogh Enhanced Deferred Annuity, 20%.
o Non-Qualified and IRA Enhanced Deferred Annuities (depending on the
contract's terms), either 10% of your Account Balance or 10% of your
Fixed Interest Account balance only.
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o If the withdrawal is required for you to avoid Federal income tax
penalties or to satisfy Federal income tax rules or Department of Labor
regulations that apply to your Enhanced Deferred Annuity.
o Except for the unallocated Keogh Enhanced Deferred Annuity, on your first
withdrawal under this provision, if this provision is approved in your
state, and either you or your spouse:
o Has been a resident of certain nursing home facilities for a minimum
of 90 consecutive days; or
o Is diagnosed with a terminal illness and not expected to live more
than a year.
o Systematic Termination. For the unallocated Keogh Enhanced Deferred
Annuity, if the contract is terminated, the Account Balance may be
systematically withdrawn in annual installments without early withdrawal
charges. You may ask to receive your money in annual installments based
on the following percentages of your Account Balance for that year's
withdrawal:
Contract Year
1* 2 3 4 5
20% 25% 33 1/3% 50% remainder
* Less that Contract Year's withdrawals
Any money you withdraw in excess of these percentages in any Contract
Year will be subject to early withdrawal charges. You may stop the
systematic termination of the contract. If you ask to restart systematic
termination, you start at the beginning of the schedule listed above.
o For the unallocated Keogh Enhanced Deferred Annuity, if you are disabled
and you request a total withdrawal. Disability is defined in the Federal
Social Security Act. If the Enhanced Deferred Annuity is issued in
connection with your retirement plan which is subject to the Employee
Retirement Income Security Act of 1974, and if your plan documents
defines disability, then your plan's definition governs.
o If you retire:
o For the Non-Qualified Enhanced Deferred Annuity, if you retire and
you receive retirement benefits from your employer's qualified plan.
o For the unallocated KeoghEnhanced Deferred Annuity, if your plan
defines retirement and you retire under that definition. If you are a
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"restricted" participant, according to the terms of the Enhanced Deferred
Annuity, you must have participated in the Enhanced Deferred Annuity
for the time stated in the contract.
o If you leave your job:
o For Non-Qualified Enhanced Deferred Annuities,
you must either leave your job with the employer or you must leave
your job and also be eligible to receive retirement benefits.
o If you are a "restricted" participant, according to the terms of the
unallocated Keogh Enhanced Deferred Annuity, you also must have
participated for the time stated in the contract.
o For the unallocated Keogh Enhanced Deferred Annuity, if your plan
terminates and the Account Balance is transferred into another annuity
contract we issue.
o For the unallocated Keogh Enhanced Deferred Annuity, if you make a
direct transfer to another investment vehicle we have preapproved. If
you are a "restricted" participant, according to the terms of the
Enhanced Deferred Annuity, you also must roll over your Account Balance
to a MetLife individual retirement annuity within 120 days after you are
eligible to receive a plan distribution.
o For the unallocated Keogh Enhanced Deferrred Annuity, if you suffer an
unforeseen hardship.
When Another Early Withdrawal Charge May Apply
If you transferred money from certain eligible MetLife contracts into an
Enhanced Deferred Annuity. You may have different early withdrawal charges for
these transfer amounts. Any purchase payments made after the transfer are
subject to the usual early withdrawal charge schedule.
o Amounts transferred before January 1, 1996:
o We credit your transfer amounts with the time you held them under
your original contract or if it will produce a lower charge:
o We use the following schedule to determine early withdrawal charges
for transferred amounts from your original contract.
During Purchase Payment Year
Year 1 2 3 4 5 6 and Beyond
Percentage 5% 4% 3% 2% 1% 0%
o Transferred amounts on or after January 1, 1996:
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o For certain contracts which we issued at least two years before the
date of the transfer, we apply the withdrawal charge under your
original contract but not any of the original contract's exceptions
or reductions to the withdrawal charge percentage they do not apply
to an Enhanced Deferred Annuity, or if it will produce a lower
charge.
We use the following schedule to determine early withdrawal charges
for transferred amounts from your original contract:
After the Transfer
Year 1 2 3 4 5 6 and Beyond
Percentage 5% 4% 3% 2% 1% 0%
o If we issued the other contract less than two years before the date
of the transfer or it has a separate withdrawal charge for each
purchase payment, we treat your purchase payments under the other
contract as if they were made under the Deferred Annuity as of the
date we received them under that contract.
o Alternatively, if provided for in the Enhanced Deferred Annuity, we
credit your purchase payments with the time you held them under your
original contract.
Free Look
You may cancel the Enhanced Deferred Annuity within a certain time period.
This is known as a "free look." We must receive your request to cancel in
writing. The number of days for this "free look" varies from state to state.
The time period may also vary depending on whether you purchased the Enhanced
Deferred Annuity through the mail. Again, depending on state law, we may
refund all of your purchase payments or your Account Balance as of the date
your refund request is received at your MetLife Designated Office.
Death Benefit
One of the insurance guarantees we provide you under the Enhanced Deferred
Annuity is that your beneficiaries will be protected against market downturns.
You name your beneficiary(ies) under the Non-Qualified and IRA Enhanced
Deferred Annuities.
If you die during the pay-in phase, the death benefit your beneficiary
receives will be the greatest of:
o Your Account Balance;
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o Your highest Account Balance as of the end of any fifth calendar year in
which you have the Deferred Annuity and as of each later five year
period. In any case, less any later partial withdrawals, fees and
charges; or
o The total of all of your purchase payments less any partial withdrawals.
Your death benefit for the unallocated Keogh Enhanced Deferred Annuity is no
more than the Account Balance and is paid to the Keogh trustee.
We will only pay the death benefit when we receive both proof of your death
and appropriate instructions for payment.
Your beneficiary has the option to apply the death benefit (less any
applicable annuity taxes) to a pay-out option offered under your Enhanced
Deferred Annuity. Your beneficiary may, however, decide to take a lump sum
cash payment.
Pay-out Options (or Income Options)
You may receive a regular stream of money after your "pay-in" or
"accumulation" phase. When you are selecting your pay-out option, you will be
able to choose from the range of options we then have available. If you decide
you want a pay-out option, we withdraw some or all of your Account Balance
(less any annuity taxes and applicable contract fees). Then, we apply the
remainder to the option. Generally, you may defer receiving payments for up to
one year after you have chosen your pay-out option.
________________________________________________________________________________
The pay-out phase is often referred to as either "annuitizing" your contract
or taking an income annuity.
________________________________________________________________________________
When considering a pay-out option, you should think about whether:
o You want payments guaranteed by us for the rest of your life (or for the
rest of two lives) or for a specified period;
o You want a fixed dollar payment or a variable payment;
o You want a refund feature.
________________________________________________________________________________
Should our current immediate annuity rates for a fixed pay-out option provide
for greater payments than those quoted in your contract, we will use the
current rates.
________________________________________________________________________________
Your income payment amount will depend upon the option you choose. For
lifetime options, the age and sex of the measuring lives (annuitants) will
also be considered.
By the date specified in your contract, if you do not either elect to continue
the contract, select a pay-out option or withdraw your entire Account Balance,
and your Enhanced Deferred Annuity was not issued under a retirement plan, we
will automatically issue you a life annuity with a 10 year guarantee. In that
case, if you do not tell us otherwise, your Fixed Interest Account Balance
will be used to provide a Fixed Income Option and your Separate Account
Balance will be used to provide a variable pay-out option. However, if we do
ask you what you want us to do and you do not respond, then we may treat your
silence as a request to continue your Enhanced Annuity.
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Because many of the features of variable pay-out options under the Enhanced
Deferred Annuities are identical to the features of Enhanced Income Annuities,
we are providing more information about variable pay-out options under the
"Enhanced Income Annuities" heading.
Enhanced Income Annuities
Enhanced Income Annuities provide you with a regular stream of payments for
either your lifetime or a specific period. Enhanced Income Annuities can be
purchased so that you begin receiving payments immediately or you can apply
the Account Balance of the Enhanced Deferred Annuity to a pay-out option to
receive payments during your "pay-out" phase. With an Enhanced Income Annuity,
you must start receiving payments within the first year after the annuity is
issued.
We do not guarantee that your variable payments will be a specific amount of
money. You may choose to have a portion of the payment fixed and guaranteed
under the Fixed Income Option.
________________________________________________________________________________
You may choose the frequency of your income payments. For example, you may
receive your payments on a monthly, quarterly, semiannual or annual basis.
________________________________________________________________________________
Using proceeds from the following types of arrangements, you may purchase
Enhanced Income Annuities to receive immediate payments:
o Non-Qualified
o Traditional IRAs
o Unallocated Keogh
If you have accumulated amounts in any of the listed investment vehicles, your
lump sum withdrawal from that investment vehicle may be used to purchase an
appropriate Income Annuity as long as income tax requirements are met
If your retirement plan has purchased an Enhanced Income Annuity, your choice
of pay-out options may be subject to the terms of the plan. We may rely on
your employer's or plan administrator's statements to us as to the terms of
the plan or your entitlement to any payments. We will not be responsible for
interpreting the terms of your plan. You should review your plan document to
see how you may be affected.
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Income Payment Types
Currently, we provide you with a wide variety of income payment types to suit
a range of personal preferences.
________________________________________________________________________________
Many times the Owner and the Annuitant are the same person.
________________________________________________________________________________
There are three people who are involved in payments under your Income Annuity:
o Owner: the person or entity which has all rights under the Income Annuity
including the right to direct who receives payment.
o Annuitant: the person whose life is the measure for determining the
timing and sometimes the dollar amount of payments.
o Beneficiary: the person who receives continuing payments or a lump sum
if the owner dies.
The following income payment types are available:
Your Lifetime Annuity: A variable income payable during the annuitant's life.
Your Lifetime with a Guaranteed Period Annuity: A variable income payable
during the annuitant's life with a guaranteed number of years. If, at the
death of the annuitant, payments have been made for less than the guaranteed
period, payments are made to the owner of the annuity (or the beneficiary if
the owner dies before the end of the guaranteed period) for the rest of the
guaranteed period.
Your Lifetime With a Refund Annuity: A variable income payable during the
annuitant's life with a refund provision. If, at the death of the annuitant,
the total of all of income payments is less than the purchase payment that we
received, we will pay to the owner of the annuity (or to the beneficiary if
the owner is not alive) an amount equal to the difference.
________________________________________________________________________________
When deciding how to receive income, consider:
o The amount of income you need;
o The amount you expect to receive from other sources;
o The growth potential of other investments; and
o How long you would like your income to last.
________________________________________________________________________________
Income for Two Lives Annuity: A variable income payable while either of two
annuitants is alive. After one annuitant dies payments continue if the other
annuitant is alive. Payments stop once both annuitants are no longer alive.
Payments after one annuitant dies may be the same as those paid while both
were alive or may be a lower percentage that is selected when the annuity is
purchased (e.g. 75%, 66 2/3% or 50%).
Income for Two Lives with a Guaranteed Period Annuity: This is the same as the
Income for Two Lives Annuity described above, but we guarantee to pay the full
amount (not a reduced percentage) for the guaranteed period even if one or
both annuitants die. If, upon the death of both annuitants, payments have been
made for less than the guaranteed period, payments are made to the owner of
the annuity (or the beneficiary if the owner dies before the end of the
guaranteed period) for the rest of the guaranteed period.
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Income for Two Lives with a Refund Annuity: This is the same as the Income for
Two Lives Annuity described above, but if, upon the death of both annuitants,
the total of all of our payments is less than the purchase payment that we
received, we will pay the owner of the annuity (or to the beneficiary if the
owner is not alive) an amount equal to the difference.
Income for a Guaranteed Period Annuity: A variable income payable for a
guaranteed period (5-30 years). Payments cease at the end of the guaranteed
period (which is often called a "term certain" period) even if the annuitant
is still alive. If the annuitant dies before the end of the guaranteed period,
payments are made to the owner of the annuity (or to the beneficiary if the
owner dies before the end of the guaranteed period) for the rest of the
guaranteed period.
Purchasing an Enhanced Income Annuity
Your purchase payment be large enough to produce an initial income payment
must be at least $50. If you live in Massachusetts, the initial income payment
must be at least $20.
Allocation of Your Purchase Payment
You decide how your money is allocated among the Fixed Income Option and the
investment divisions.
The Value of Your Income Payments
Annuity units are credited to you when you make a purchase payment or transfer
into an investment division. When you transfer money from an investment
division, annuity units in that investment division are liquidated. Before we
determine the number of annuity units you have, we reduce your purchase
payments by any annuity taxes and the contract fee, if applicable. We then
divide the remainder by the Annuity Unit Value on the date of the transaction.
________________________________________________________________________________
The AIR is stated in your contract and may range from 3% to 6%.
________________________________________________________________________________
Your payment is determined by using the Assumed Investment Return ("AIR") to
benchmark the investment experience of the investment divisions you select.
The higher your AIR, the higher your first income payment will be. Your next
payments will only increase in proportion to the amount the investment
experience of your chosen investment divisions exceeds the AIR and Separate
Account charges. Likewise, your payments will decrease to the extent the
investment experience of your chosen investment divisions is less than the AIR
and Separate Account charges. A lower AIR will result in a lower initial
variable income payment, but subsequent variable income payments will increase
more rapidly or decline more slowly as changes occur in the investment
experience of the investment divisions.
Your income payments are determined ten days prior to your income payment date
or your contract's issue date, if later.
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This is how we calculate the Annuity Unit Value for each investment division:
o First, we determine the change in investment experience (including any
investment-related charge) for the underlying portfolio from the previous
trading day to the current trading day;
o Next, we subtract by the daily equivalent of your insurance-related
charge (general administrative expense and mortality and expense risk
charges) for each day since the last day the Annuity Unit Value was
calculated;
o Then, we divide by the daily equivalent of your AIR; and
o Finally, we multiply the previous Annuity Unit Value by this result.
Transfers
You can make an unlimited number of transfers among investment divisions or
from the investment divisions to the Fixed Income Option. If you reside in
certain states you may be limited to four options (including the Fixed
Interest Option).
________________________________________________________________________________
Once you transfer money into the Fixed Income Option you may not later
transfer it into an investment division.
________________________________________________________________________________
For us to process a transfer, you must tell us:
o The percentage or dollar amount of the transfer;
o The investment division (or Fixed Income Option) to which you want
to transfer; and
o The investment division from which you want to transfer.
We may require that you use our forms to make transfers.
Contract Fee
There is no contract fee.
Charges
There are two types of charges you pay if you allocate any of your purchase
payment to the investment divisions:
o Insurance-related charge; and
o Investment-related charge.
________________________________________________________________________________
The charges you pay will not reduce the number of annuity units credited to
you. Instead, we deduct the charges when calculating the Annuity Unit Value.
________________________________________________________________________________
Insurance-Related Charge
You will pay an insurance-related charge for the Separate Account that is no
more than .95% annually of the average value of the amount you have in the
Separate Account. This charge pays us for general administrative expenses and
for mortality and expense risk of the Enhanced Income Annuity.
General administrative expenses we incur include financial, actuarial,
accounting, and legal expenses.
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The mortality portion of the insurance-related charge pays us for the risk
that you may live longer than we estimated. Then, we could be obligated to pay
you more in payments than we anticipated.
We also bear the risk that our expenses in administering the Enhanced Income
Annuities will be greater than we estimated (expense risk).
Investment-Related Charge
This charge pays us as the investment manager of the Metropolitan Fund for
managing money in the Portfolios and investment operating expenses. The
percentage you pay depends on the investment divisions you select. Amounts for
each investment division are listed in the Table of Expenses.
Annuity Taxes
Some jurisdictions tax what are called "annuity considerations." We deduct
money to pay "annuity" taxes (also known as "premium" taxes) when you make the
purchase payment. A chart in the Appendix shows the jurisdictions where
annuity taxes are charged and the amount of these taxes.
Free Look
You may cancel your Enhanced Income Annuity within a certain time period. This
is known as a "free look." We must receive your request to cancel in writing.
The number of days for this "free look" varies from state to state. The "free
look" may also vary depending on whether you purchased your Enhanced Income
Annuity through the mail. Again, depending on state law, we may refund all of
your purchase payment or the value of your annuity units as of the date your
refund request is received at your MetLife Designated Office.
________________________________________________________________________________
You do not have a free look if you are electing income payments in the pay-out
phase of your Enhanced Deferred Annuity.
________________________________________________________________________________
General Information
Administration
All transactions will be processed in the manner described below.
Purchase Payments
Send your purchase payments by check or money order made payable to "MetLife"
to your MetLife Designated Office. We will provide you with all necessary
forms. We must have all completed documents to credit your initial purchase
payments.
________________________________________________________________________________
Generally, your requests including all subsequent purchase payments are
effective the day we receive them at your MetLife Designated Office.
________________________________________________________________________________
Usually, your initial purchase payment is credited to you within two days of
receipt at your MetLife Designated Office. However, if you fill out our forms
incorrectly or incompletely or other documentation is not completed properly,
we have up to five business days to credit the payment. If the problem cannot
be resolved by the fifth business day, we will notify you and give you the
reasons for the delay. At that time, you will be asked whether you agree to
let us keep
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your money until the problem is resolved. If you do not agree or we cannot
reach you by the fifth business day, your money will be returned.
Under certain group Enhanced Deferred Annuities and group Enhanced Income
Annuities, your employer, or the group in which you are a participant or
member must identify you on their reports to us and tell us how your money
should be allocated among the investment divisions and the Fixed Interest
Account/Fixed Income Option.
Purchase payments (including any portion of your Account Balance under a
Enhanced Deferred Annuity which you apply to a pay-out option) are effective
and valued as of 4:00 p.m. Eastern time, on the day we receive them in good
order at your MetLife Designated Office, except when they are received:
o On a day when the Accumulation Unit Value/Annuity Unit Value is not
calculated, or
o After 4:00 p.m. Eastern time.
In those cases, the purchase payments will be effective the next day the
Accumulation Unit Value or Annuity Unit Value, as applicable, is calculated.
Confirming Transactions
You will receive a written statement confirming that a transaction was
recently completed. Certain transactions made a periodic basis, such as
check-o-matic, Systematic Withdrawal Program payments, and automated
investment strategy transfers, may be confirmed quarterly.
Transactions by Telephone
You may conduct a variety of transactions by telephone, unless prohibited by
state law. Some of these transactions include:
o Transfers
o Changes to investment strategies
o Changes in the allocation of future purchase payments.
Your telephone transaction must be completed by 4:00 p.m. Eastern time if you
want the transaction to take place on that day.
We have put into place reasonable security procedures to insure that
instructions communicated by telephone are genuine. For example, all telephone
calls are recorded. Also, you will be asked to provide some personalized data
prior to giving your instructions over the telephone. When someone contacts us
by telephone and follows our security procedures, we will assume that you are
authorizing us to act upon those telephone instructions. Neither we nor the
Separate Account will be liable for any loss, expense or cost arising out of
any requests that we or the Separate Account reasonably believe to be
authentic. In the unlikely event that you have trouble reaching us, requests
should be made in writing to your MetLife Designated Office.
________________________________________________________________________________
Except for the unallocated Keogh Enhanced Deferred Annuities, you may
authorize your sales representative to make telephone transactions on your
behalf. You must complete our form and we must agree.
________________________________________________________________________________
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Processing of Certain Transactions
If we are notified of your death before a requested transaction is completed,
we will cancel the request. For example, if you request a transfer or
withdrawal for a date in the future under an Enhanced Deferred Annuity and
then die before that date, we simply pay the death benefit instead. For
Enhanced Income Annuity transfers, we will cancel the request and continue
making payments to your beneficiary if your Income Annuity so provides. Or,
depending on your Income Annuity's provisions, we may continue making payments
to a joint annuitant or pay your beneficiary a refund.
Valuation
We separately determine the Accumulation Unit Value and Annuity Unit Value for
each investment division once each day when the New York Stock Exchange is
open for trading. If permitted by law, we may change the period between
calculations but we will give you 30 days notice.
When you request a transaction, we will process the transaction using the next
available Accumulation Unit Value for Enhanced Deferred Annuities or Annuity
Unit Value for Enhanced Income Annuities. Subject to our procedure, we will
make withdrawals under an Enhanced Deferred Annuity and transfers under an
Enhanced Deferred Annuity or Enhanced Income Annuity at a later date, if you
request. If your withdrawal request is to elect a variable pay-out option
under your Enhanced Deferred Annuity, we base the number of annuity units you
receive on the next available Annuity Unit Value.
Advertising Performance
We periodically advertise the performance of the investment divisions. You may
get performance information from a variety of sources including your quarterly
statements, your MetLife representative, the internet, annual reports and
semiannual reports.
We may state performance in terms of "yield," "change in Accumulation Unit
Value/Annuity Unit Value," "average annual total return," or some combination
of these terms.
Yield is the net income generated by an investment in a particular investment
division for 30 days or a month. These figures are expressed as percentages.
This percentage yield is compounded semiannually.
Change in Accumulation/Annuity Unit Value is calculated by determining the
percentage change in the value of an accumulation (or annuity) unit for a
certain period. These numbers may also be annualized. Change in
Accumulation/Annuity Unit Value may be used to demonstrate performance for a
hypothetical investment (such as $10,000) over a specified period. These
performance numbers reflect the deduction of the total Separate Account
charges; however, yield and change in Accumulation/Annuity Unit Value
performance do not reflect the possible imposition of early withdrawal
charges. Early withdrawal charges would reduce performance experience.
________________________________________________________________________________
All performance numbers are based upon historical earnings. These numbers are
not intended to indicate future results.
________________________________________________________________________________
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Average annual total return calculations reflect all Separate Account charges
and applicable early withdrawal charges. These figures also assume a steady
annual rate of return.
Performance figures will vary among the various Enhanced Deferred Annuities
and Enhanced Income Annuities as a result of different Separate Account
charges and early withdrawal charges. For purposes of presentation, we may
assume that certain Enhanced Deferred Annuities and Enhanced Income Annuities
were in existence prior to their inception date. In these cases, we calculate
performance based on the historical performance of the underlaying
Metropolitan Fund Portfolios. We use the actual accumulation unit or annuity
unit data after the inception date.
We calculate performance for certain investment strategies including the
Equalizer, Equity Generator and each asset allocation model of the Index
Selector. We calculate the performance as a percentage by presuming a certain
dollar value at the beginning of a period and comparing this dollar value with
the dollar value based on historical performance at the end of that period.
This percentage return assumes that there have been no withdrawals or other
unrelated transactions.
Changes to Your Enhanced Deferred Annuity
or Enhanced Income Annuity
We have the right to make certain changes to your Enhanced Deferred Annuity or
Enhanced Income Annuity, but only as permitted by law. We make changes when we
think they would best serve the interest of annuity owners or would be
appropriate in carrying out the purposes of the Enhanced Deferred Annuity or
Enhanced Income Annuity. If the law requires, we will also get your approval
and the approval of any appropriate regulatory authorities. Examples of the
changes we may make include:
o To operate the Separate Account in any form permitted by law.
o To take any action necessary to comply with or obtain and continue any
exemptions under the law.
o To transfer any assets in an investment division to another investment
division, or to one or more separate accounts, or to our general account,
or to add, combine or remove investment divisions in the Separate
Account.
o To substitute for the Portfolio shares in any investment division, the
shares of another class of the Metropolitan Fund or the shares of another
investment company or any other investment permitted by law.
o To change the way we assess charges, but without increasing the aggregate
amount charged to the Separate Account and any currently available
portfolio in connection with the Enhanced Deferred Annuities or Enhanced
Income Annuities.
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o To make any necessary technical changes in the Enhanced Deferred
Annuities or Enhanced Income Annuities in order to conform with any of
the above-described actions.
If any changes result in a material change in the underlying investments of an
investment division in which you have a balance, we will notify you of the
change. You may then make a new choice of investment divisions. For Enhanced
Deferred Annuities issued in Pennsylvania (and Enhanced Income Annuities where
required by law), we will ask your approval before making any technical
changes.
Voting Rights
Based on our current view of applicable law, you have voting interests under
your Enhanced Deferred Annuity or Enhanced Income Annuity concerning
Metropolitan Fund proposals that are subject to a shareholder vote. Therefore,
you are entitled to give us instructions for the number of shares which are
deemed attributable to your Enhanced Deferred Annuity or Enhanced Income
Annuity.
We will vote the shares of each of the underlying Portfolios held by the
Separate Account based on instructions we receive from those having a voting
interest in the corresponding investment divisions. However, if the law or the
interpretation of the law changes, we may decide to exercise the right to vote
the Portfolio's shares based on our own judgment.
You will be entitled to give instructions regarding the votes attributable to
your Non-Qualified or IRA Enhanced Deferred Annuity or an Enhanced Income
Annuity in your sole discretion. Under the unallocated Keogh Enhanced Deferred
Annuity, participants may instruct you to give us instructions regarding
shares deemed attributable to their contributions to the Enhanced Deferred
Annuity. Under the unallocated Keogh Enhanced Deferred Annuity, we will
provide you with the number of copies of voting instruction soliciting
materials that you request so that you may furnish such materials to
participants who may give you voting instructions. Neither the Separate
Account nor MetLife has any duty to inquire as to the instructions received or
your authority to give instructions; thus, as far as the Separate Account, and
any others having voting interests in respect of the Separate Account are
concerned, such instructions are valid and effective.
There are certain circumstances under which we may disregard voting
instructions. However, in this event, a summary of our action and the reasons
for such action will appear in the next semiannual report. If we do not
receive your voting instructions, we will vote your interest in the same
proportion as represented by the votes we receive from other investors. Shares
of the Metropolitan Fund that are owned by our general account or by any of
our unregistered separate accounts will be voted in the same proportion as the
aggregate of:
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o The shares for which voting instructions are received, and
o The shares that are voted in proportion to such voting instructions.
However, if the law or the interpretation of the law changes, we may decide to
exercise the right to vote the Portfolio's shares based on our judgment.
Who Sells the Enhanced Deferred Annuities and Enhanced Income Annuities
All Enhanced Deferred Annuities and Enhanced Income Annuities, are sold
through individuals who are our licensed sales representatives. We are
registered with the Securities and Exchange Commission as a broker-dealer
under the Securities Exchange Act of 1934. We are also a member of the
National Association of Securities Dealers, Inc. Enhanced Deferred Annuities
and Enhanced Income Annuities are also sold through other registered
broker-dealers. They also may be sold through the mail.
The licensed sales representatives and broker-dealers who sell the annuities
may be compensated for these sales by commissions that we pay. There is no
front-end sales load deducted from purchase payments to pay sales commissions.
The Separate Account does not pay sales commissions. The commissions we pay
range from 0% to 6%.
We also make payments to our licensed sales representatives based upon the
total Account Balances of the Enhanced Deferred Annuities assigned to the
sales representative. Under this compensation program, we pay an amount up to
.12% of the total Account Balances of the Enhanced Deferred Annuities and
other annuity contracts, certain mutual fund account balances and cash values
of certain life insurance policies. These asset based commissions compensate
the sales representative for servicing the Enhanced Deferred Annuities. These
payments are not made for Enhanced Income Annuities.
Financial Statements
The financial statements for the Separate Account and MetLife are in the SAI
and are available from MetLife upon request.
Your Spouse's Rights
If you received your contract through a qualified retirement plan and your
plan is subject to ERISA (the Employee Retirement Income Security Act of 1974)
and you are married, the income payments, withdrawal provisions, and methods
of payment of the death benefit under your Enhanced Deferred Annuity or
Enhanced Income Annuity may be subject to your spouse's rights.
If your benefit is worth $5,000 or less, your plan may provide for
distribution of your entire interest in a lump sum without your spouse's
consent.
C-PPA-39
<PAGE>
For details or advice on how the law applies to your circumstances, consult
your tax advisor or attorney.
When We Can Cancel Your Enhanced Deferred Annuity or Enhanced Income Annuity
We may not cancel your Enhanced Income Annuity.
We may cancel your Enhanced Deferred Annuity only if we do not receive any
purchase payments from you for 36 consecutive months and your Account Balance
is less than $2,000 (except for the unallocated Keogh Enhanced Deferred
Annuity). We may only cancel the unallocated Keogh Enhanced Deferred Annuity
if we do not receive any purchase payments for you for 12 consecutive months
and your Account Balance is less than $15,000. We will only do so to the
extent allowed by law.
Certain Enhanced Deferred Annuities do not contain these cancellation
provisions.
If we do cancel your Enhanced Deferred Annuity delivered in New York, we will
return the full Account Balance. In all other cases, you will receive an
amount equal to what you would have received if you had requested a total
withdrawal of your Account Balance. Early withdrawal charges may apply.
Income Taxes
The following information on taxes is a general discussion of the subject. It
is not intended as tax advice. The Internal Revenue Code ("Code") is complex
and subject to change regularly. Consult your own tax advisor about your
circumstances, any recent tax developments, and the impact of state income
taxation. The SAI has additional tax information. For purposes of this
section, we address Deferred Annuities and Income Annuities together as
annuities. In addition, because the tax treatment of Income Annuities and the
pay-out option under Deferred Annuities is generally the same, they are
discussed together as income payments.
General
Deferred annuities are a means of setting aside money for future needs-usually
retirement. Congress recognizes how important saving for retirement is and has
provided special rules in the Internal Revenue Code (Code).
All IRA's receive tax deferral under the Code. Although there are no
additional tax benefits by funding your IRA with an annuity, it does provide
you additional insurance benefits such as guaranteed income for life.
________________________________________________________________________________
Simply stated, income tax rules for Enhanced Deferred Annuities generally
provide that earnings are not subject to tax until withdrawn. This is referred
to as tax deferral.
________________________________________________________________________________
C-PPA-40
<PAGE>
Because these products are intended for retirement, if you make a taxable
withdrawal before age 59 1/2 you may incur a tax penalty. When you withdraw
money from your contract, the amount reported as income differs depending on:
o the type of annuity you purchase, (e.g., Non-Qualified or IRA) and
o the type of pay-out option you elect.
We are not responsible for determining if your employer's plan or arrangement
satisfies the requirements of the Code and/or ERISA.
Withdrawals Before Age 59 1/2
If you receive a taxable distribution from your contract before you reach age
59 1/2, this amount may be subject to a 10% penalty tax, in addition to
ordinary income taxes.
As indicated in the chart below, some distributions prior to age 59 1/2 are
exempt from the penalty. Some of these exceptions include amounts received:
Type of Contract
Non Trad.
Qualified IRA Keogh
----- --- ----
In a series of substantially equal payments
made annually (or more frequently)
for life or life expectancy (SEPP) x x x(1)
After you die x x x
After you become totally disabled (as
defined in the Code) x x x
To pay deductible medical expenses x x
To pay medical insurance premiums if
you are unemployed x
After December 31, 1997 to pay for
qualified higher education expenses, or x
After December 31, 1997 for qualified
first time home purchases up to $10,000 x
After separation from service if you are
over age 55 x
(1) You must also be separated from service
C-PPA-41
<PAGE>
Systemic Withdrawal Program for Substantially Equal Periodic Payments (SEPP)
If you are considering using the Systemic Withdrawal Program for the purpose
of meeting the SEPP exception to the 10% tax penalty, consult with your tax
advisor.
If you receive systematic payments that you intend to qualify for the SEPP
exception, any modifications to your payment before age 59 1/2 or within five
years after beginning Systematic Withdrawal Program payments will result in
the retroactive imposition of the 10% penalty.
Non-Qualified Annuities
o Contributions to Non-Qualified annuities are on an "after-tax" basis,
so you only pay income taxes on your earnings. Generally, these earnings
are taxed when you receive them from the contract.
o Your Non-Qualified annuity may be exchanged for another Non-Qualified
annuity without paying income taxes if certain Code requirements are met.
o When a non-natural person owns a Non-Qualified annuity the annuity will
generally not be treated as an annuity for tax purposes and thus lose the
benefit of tax deferral. Corporations and certain other entities are
generally considered non-natural persons. However, an annuity owned by a
non-natural person as agent for an individual will be treated as an
annuity for tax purposes.
o Annuities issued after October 21, 1988 by the same insurance company in
the same year are combined for tax purposes. As a result, a greater
portion of your withdrawals may be considered taxable income than you
would otherwise expect.
Contributions
Although the Code does not limit the amount of your purchase payments, your
contract may limit them.
Withdrawals
Generally, when you make a withdrawal from your non-qualified annuity, the
Code treats such a withdrawal as:
o First coming from earnings (and thus subject to income tax); and
o Then from your purchase payments (which are not subject to income tax).
Different tax rules apply to payments made pursuant to an income annuity
pay-out option under your contract. They are subject to an "exclusion ratio"
which determines how much of each payment is treated as:
________________________________________________________________________________
After-tax means that your purchase payments to your annuity does not reduce
your taxable income or give you a tax deduction.
________________________________________________________________________________
C-PPA-42
<PAGE>
o A non-taxable return of your contributions; and
o A taxable payment of earnings.
We will withold a portion of the taxable amount of your withdrawal for income
taxes, unless you elect otherwise. The amount we withhold is determined by the
Code.
If you choose an income annuity payout option we generally will tell you how
much of each income payment is a non-taxable return of contributions.
Generally once the total amount treated as a non-taxable return of your
purchase payments equals your purchase payments, then all remaining income
payments are fully taxable.
Under the Code, withdrawals from Non-Qualified annuities need not be made by a
particular age. However, it is possible that the Internal Revenue Service may
determine that you must take a lump sum withdrawal or elect to receive income
payments by a certain age (e.g., 85).
After Death
If you die before payments under an income annuity begin, we must make payment
of your entire interest in the Contract within five years of your death or
begin payments under an income annuity allowed by the Code to your beneficiary
within one year of your death.
If you die after income payments begin, payments must continue to be made at
least as rapidly as before your death in accordance with the income type
selected.
If you die before all purchase payments are returned, the unreturned amount
may be deductible on your final income tax return or excluded from income by
your beneficiary if income payments continue after your death.
________________________________________________________________________________
If you die during the accumulation phase of a Deferred Annuity and your spouse
is your beneficiary or a co-owner he or she may elect to continue as "owner"
of the contract .
________________________________________________________________________________
Traditional IRA Annuities
Generally your IRA can accept deductible (or pre-tax) and non-deductible
(after-tax) contributions. Deductible or pre-tax purchase payments will be
taxable when distributed from the contract.
o Your annuity is generally not forfeitable (e.g. not subject to claims of
your creditors) and you may not transfer it to someone else.
o You can transfer your IRA proceeds to a similar IRA, without incurring
Federal income taxes if certain conditions are satisfied.
________________________________________________________________________________
Annual contributions to your IRAs, including ROTH IRAs, may not exceed the
lesser of $2,000 or 100% of your "compensation" as defined by the Code, except
for "spousal" IRAs.
________________________________________________________________________________
C-PPA-43
<PAGE>
Contributions
Generally:
o Contributions to traditional IRAs are limited to the lesser of 100% of
compensation or $2,000 per year. A $2,000 contribution can also be made
for a non-working spouse provided the couple's compensation is at least
equal to their aggregate contributions.
o Contributions in excess of this amount may be subject to a penalty tax.
o Contributions are generally permitted up to age 70 1/2.
o These age and dollar limits do not apply to tax-free rollovers or
transfers.
o If certain conditions are met, you can change your Traditional IRA
contribution to a Roth IRA before you file your income tax return
(including filing extensions).
________________________________________________________________________________
In some cases, your purchase payments may be tax deductible.
________________________________________________________________________________
Withdrawals
Withdrawals are included in income except for the portion that represents a
return of non-deductible purchase payments. This portion is determined based
on a ratio of all non-deductible contributions to the total values of all your
IRAs.
We will withold a portion of the taxable amount of your withdrawal for income
taxes, unless you elect otherwise. The amount we withhold is determined by the
Code.
Minimum Distribution Requirements
Generally you must begin receiving withdrawals by April 1 of the calendar year
following the year in which you reach age 70 1/2.
A tax penalty of 50% applies to withdrawals which should have been taken but
were not. Complex rules apply to the timing and calculation of these
withdrawals.
________________________________________________________________________________
You may combine the money required to be withdrawn from each of your
Traditional IRAs and withdraw this amount from any one or more of them.
________________________________________________________________________________
After Death
Generally, if you die before required minimum distribution withdrawals have
begun we must make payment of your entire interest within five years after the
year of your death or begin income payments under an income annuity allowed by
the Code to your beneficiary by December 31st of the year after your death.
If your spouse is your beneficiary, and, if your contract permits, your spouse
may delay the start of income payments until December 31 of the year in which
the decedent would have reached age 70 1/2.
If you die after required withdrawals begin, payments must continue at least
as rapidly as under the distribution method in effect at your death.
________________________________________________________________________________
If your spouse is your beneficiary and if your contract permits, he or she may
elect to continue as "owner" of the contract.
________________________________________________________________________________
C-PPA-44
<PAGE>
Keogh Annuities
General
Pension and profit-sharing plans satisfying certain Code provisions are
considered to be "Keogh" plans.
Contributions
Generally, all contributions will be contributed on a "before-tax" basis. This
means that the purchase payments either reduce your income, entitle you to a
tax deduction or are not subject to current income tax.
Under some circumstances, "after-tax" contributions can be made to certain
annuities. These contributions do not reduce your taxable income or give you a
tax deduction.
There are annual contribution limits for your Keogh annuities. Purchase
payments in excess of these limits may result in adverse tax consequences.
Withdrawals
If certain requirements are met, you may be able to transfer amounts in your
contract to another eligible retirement plan or IRA.
Withdrawals and income payment are included in income except for the portion
that represents a return of non-deductible purchase payments.
Minimum Distribution Requirements
Generally, you must begin receiving withdrawals from your contract by April 1
of the calendar year following the later of:
o The year you turn age 70 1/2 or
o Provided you do not own 5% or more of your employer, and to the extent
permitted by your plan and contract, the year you retire.
Complex rules apply to timing and calculating these withdrawals. A tax penalty
of 50% applies to withdrawals, which should have been taken but were not.
Mandatory 20% Withholding
We are required to withhold 20% of the taxable portion of your withdrawal that
constitutes an "eligible rollover distribution" for Federal income taxes. We
are not required to withhold this money if you direct us, the trustee or the
custodian of the plan to transfer your "eligible rollover distribution" to a
traditional IRA or another eligible retirement plan.
An "eligible rollover distribution" is any taxable amount you receive from
your contract. It does not include taxable distributions that are:
C-PPA-45
<PAGE>
o A series of substantially equal payments made at least annually for :
o Your life or life expectancy
o Both you and your beneficiary's lives or life expectancies
o A specified period of 10 years or more
o To satisfy minimum distribution requirements
Other exceptions to the definition of "eligible rollover distributions" exist.
For taxable withdrawals that are not "eligible rollover distributions" the
Code requires different withholding rules which are determined at the time of
payment. You may elect out of these withholding requirements.
After Death
If you die before required minimum distribution withdrawals have begun, we
must make payment of your entire interest in the Contract within the five
years after the year of your death or begin payments under an income annuity
allowed by the Code to your beneficiary by December 31st of the year after
your death.
If your spouse is your beneficiary and if your contract permits, your spouse
may delay the start of income payments until December 31st of the year in
which you would have reached age 70 1/2.
If you die after required withdrawals begin, payments must continue at least
as rapidly as under the distribution method in effect at your death.
C-PPA-46
<PAGE>
Table of Contents for the Statement of Additional Information
Page
Cover Page ............................................................. 1
Table of Contents ...................................................... 1
Independent Auditors ................................................... 2
Services ............................................................... 2
Year 2000 .............................................................. 2
Distribution of Certificates and Interests in the Deferred Annuities
and Income Annuities ................................................. 2
Early Withdrawal Charge ................................................ 2
Experience Factor ...................................................... 2
Variable Income Payments ............................................... 2
Investment Management Fees ............................................. 5
Performance Data and Advertisement of the Separate Account ............. 6
Voting Rights .......................................................... 7
ERISA .................................................................. 8
Taxes .................................................................. 9
Performance Data ....................................................... 22
Financial Statements of the Separate Account ................................
Financial Statements of MetLife .............................................
C-PPA-47
<PAGE>
Appendix
Annuity Tax Table
If you are a resident of one of the following jurisdictions, the percentage
amount listed by the jurisdiction is the annuity tax rate which will be
applied to your Enhanced Deferred Annuity or Enhanced Income Annuity.
Traditional IRA Unallocated Non-Qualified
Enhanced Deferred Keogh Enhanced Enhanced
and Income Deferred and Deferred and
Annuities (1) Income Annuities Income Annuities
California 0.5% (2) 0.5% 2.35%
Kentucky (3) 2.0% 2.0% 2.0%
Maine -- -- 2.0%
Nevada -- -- 3.5%
Puerto Rico 1.0% 1.0% 1.0%
South Dakota -- -- 1.25%
U.S. Virgin Islands 5.0% 5.0% 5.0%
West Virginia 1.0% 1.0% 1.0%
Wyoming -- -- 1.0%
- ----------
(1) Annuity tax rates applicable to IRA Enhanced Deferred and Income Annuities
purchased for use in connection with individual retirement trust or
custodial accounts meeting the requirements of Section 408(a) of the Code
are included under the column headed "Enhanced IRA Deferred and Income
Annuities."
(2) With respect to Enhanced Deferred and Income Annuities purchased for use
in connection with individual retirement trust or custodial accounts
meeting requirements of Section 408(a) of the Code, the annuity tax rate in
California is 2.35% instead of 0.5%.
(3) The annuity tax in Kentucky is repealed effective January 1, 2000.
PEANUTS(Copyright) United Feature Syndicate, Inc.
(Copyright)1999 Metropolitan Life Insurance Company
C-PPA-48
<PAGE>
{LOGO OF METROPOLITAN LIFE INSURANCE COMPANY] [INDICIA]
Metropolitan Life Insurance Company
Johnstown Office, 500 Schoolhouse Road
Johnstown, PA 15904-2914
Address Service Requested
<PAGE>
April 30, 1999
Financial Freedom Account Variable Annuity Contracts
Issued by Metropolitan Life Insurance Company
This Prospectus describes group Financial Freedom contracts for deferred
variable annuities ("Financial Freedom Deferred Annuities") and Financial
Freedom immediate variable income annuities ("Financial Freedom Income
Annuities").
- --------------------------------------------------------------------------------
You decide how to allocate your money among the various available investment
choices. The investment choices available to you are listed in the contract for
your Financial Freedom Deferred Annuity or Financial Freedom Income Annuity.
Your choices may include the Fixed Interest Account (not described in this
Prospectus) and investment divisions available through Metropolitan Life
Separate Account E which, in turn, invest in the following corresponding
portfolios of the Metropolitan Series Fund, Inc. ("Metropolitan Fund"), two
portfolios of the Calvert Variable Series, Inc. ("Calvert Fund") and portfolios
of the Variable Insurance Products Fund and Variable Insurance Products Fund II
("Fidelity VIP and VIPII Funds").
State Street Research Aggressive Growth
State Street Research Diversified
State Street Research Growth
State Street Research Income
Harris Oakmark Large Cap Value
Janus Mid Cap
Loomis Sayles High Yield Bond
Neuberger & Berman Partners Mid Cap Value
Santander International Stock
Scudder Global Equity
T. Rowe Price Large Cap Growth
T. Rowe Price Small Cap Growth
Lehman Brothers Aggregate Bond Index
MetLife Stock Index
Morgan Stanley EAFE(Registered) Index
Russell 2000(Registered) Index
Calvert Social Balanced
Calvert Social Mid Cap Growth
Fidelity VIP Equity-Income
Fidelity VIP Growth
Fidelity VIP Money Market
Fidelity VIP Overseas
Fidelity VIPII Asset Manager
Fidelity VIPII Investment Grade Bond
How to learn more:
Before investing, read the information in this Prospectus about the Financial
Freedom Deferred Annuities, Financial Freedom Income Annuities and Metropolitan
Life Separate Account E. Keep this Prospectus for future reference. For more
information, request a copy of the Statement of Additional Information ("SAI"),
dated April 30, 1999. The SAI is considered part of this Prospectus as though it
were included in the Prospectus. The Table of Contents of the SAI appears on
page FFA-71 of this Prospectus. To request a free copy of the SAI or to ask
questions, write or call:
Metropolitan Life Insurance Company
Retirement and Savings Center, Area 2H
One Madison Avenue
New York, NY 10010-3690
Attention: Alan DeMichele
Phone: (800) 553-4459
The Securities and Exchange Commission has a website (http://www.sec.gov) which
you may visit to view this Prospectus, SAI and other information. The Securities
and Exchange Commission has not approved or disapproved these securities or
determined if this Prospectus is truthful or complete. Any representation
otherwise is a criminal offense.
The current Metropolitan Fund prospectus, and, if applicable, the Calvert Fund
and Fidelity VIP and Fidelity VIPII Funds prospectuses are attached to the back
of this Prospectus. You should also read these prospectuses carefully before
purchasing a Financial Freedom Deferred Annuity or Financial Freedom Income
Annuity. This Prospectus is not valid unless attached to Metropolitan Fund,
Calvert Fund and Fidelity VIP and Fidelity VIPII Funds prospectuses, as
applicable.
Financial Freedom Deferred Annuities Available for Purchase:
o TSA
o 403(a)
o Non-Qualified (for certain deferred arrangements and plans)
Financial Freedom Income Annuities Available:
o TSA
o 403(a)
o Non-Qualified (for certain deferred arrangements and plans)
A word about investment risk:
An investment in any of these variable annuities involves investment risk. You
could lose money you invest. Money invested in is NOT:
o a bank deposit or obligation;
o federally insured or guaranteed; or
o endorsed by any bank or other financial institution.
[LOGO OF METROPOLITAN LIFE INSURANCE COMPANY]
<PAGE>
April 30, 1999
Enhanced Preference Plus(Registered) Account Variable Annuity
Contracts Issued by Metropolitan Life Insurance Company
This Prospectus describes group Enhanced Preference Plus contracts for deferred
variable annuities ("Enhanced Deferred Annuities") and Enhanced Preference Plus
immediate variable income annuities ("Enhanced Income Annuities").
- --------------------------------------------------------------------------------
You decide how to allocate your money among the various available investment
choices. The investment choices available to you are listed in your Enhanced
Deferred Annuity or Enhanced Income Annuity. Your choices may include the Fixed
Interest Account (not described in this Prospectus) and investment divisions
available through Metropolitan Life Separate Account E which, in turn, invest in
the following corresponding portfolios of the Metropolitan Series Fund, Inc.
("Metropolitan Fund"), two portfolios of the Calvert Variable Series, Inc.
("Calvert Fund") and portfolios of the Variable Insurance Products Fund and
Valuable Insurance Products Fund II ("Fidelity VIP and VIPII Funds"):
State Street Research Aggressive Growth
State Street Research Diversified
State Street Research Growth
State Street Research Income
Harris Oakmark Large Cap Value
Janus Mid Cap
Loomis Sayles High Yield Bond
Neuberger & Berman Partners Mid Cap Value
Santander International Stock
Scudder Global Equity
T. Rowe Price Large Cap Growth
T. Rowe Price Small Cap Growth
Lehman Brothers Aggregate Bond Index
MetLife Stock Index
Morgan Stanley EAFE(Registered) Index
Russell 2000(Registered) Index
Calvert Social Balanced
Calvert Social Mid Cap Growth
Fidelity VIP Equity-Income
Fidelity VIP Growth
Fidelity VIP Overseas
Fidelity VIPII Asset Manager
Fidelity VIPII Investment Grade Bond
How to learn more:
Before investing, read the information in this Prospectus about the Enhanced
Deferred Annuities, Enhanced Income Annuities and Metropolitan Life Separate
Account E. Keep this Prospectus for future reference. For more information,
request a copy of the Statement of Additional Information ("SAI"), dated April
30, 1999. The SAI is considered part of this Prospectus as though it were
included in the Prospectus. The Table of Contents of the SAI appears on page
FFA-71 of this Prospectus. To request a free copy of the SAI or to ask
questions, write or call:
Metropolitan Life Insurance Company
Retirement and Savings Center, Area 2H
One Madison Avenue
New York, NY 10010-3690
Attention: Alan DeMichele
Phone: (800) 553-4459
The Securities and Exchange Commission has a website (http://www.sec.gov) which
you may visit to view this Prospectus, SAI and other information. The Securities
and Exchange Commission has not approved or disapproved these securities or
determined if this Prospectus is truthful or complete. Any representation
otherwise is a criminal offense.
The current Metropolitan Fund prospectus, and, if applicable, the Calvert Fund
and Fidelity VIP and VIPII Funds prospectuses are attached to the back of this
Prospectus. You should also read these prospectuses carefully before purchasing
an Enhanced Deferred Annuity or Enhanced Income Annuity. This Prospectus is not
valid unless attached to Metropolitan Fund, Calvert Fund and Fidelity VIP and
VIPII Funds Prospectuses, as applicable.
Enhanced Deferred Annuities Available for Purchase:
o TSA
o 403(a)
o PEDC
o Traditional IRA
o Non-Qualified
o Non-Qualified (for certain deferred arrangements or plans)
Enhanced Income Annuities Available:
o TSA
o 403(a)
o PEDC
o Traditional IRA
o Non-Qualified
o Non-Qualified (for certain deferred arrangements or plans)
A word about investment risk:
An investment in any of these variable annuities involves investment risk. You
could lose money you invest. Money invested is NOT:
o a bank deposit or obligation;
o federally insured or guaranteed; or
o endorsed by any bank or other financial institution.
[LOGO OF METROPOLITAN LIFE INSURANCE COMPANY]
<PAGE>
TABLE OF CONTENTS
Important Terms You Should Know ......................................... FFA-4
Table of Expenses ....................................................... FFA-7
Accumulation Unit Values Table .......................................... FFA-10
MetLife ................................................................. FFA-28
Metropolitan Life Separate Account E .................................... FFA-28
The Variable Annuities in this Prospectus ............................... FFA-29
A Deferred Annuity ................................................. FFA-29
An Income Annuity .................................................. FFA-29
Your Investment Choices ................................................. FFA-30
Deferred Annuities ...................................................... FFA-31
The Deferred Annuity and Your Retirement Plan ...................... FFA-33
Automated Investment Strategies .................................... FFA-33
Purchase Payments .................................................. FFA-34
Allocation of Purchase Payments .................................. FFA-34
Limits on Purchase Payments ...................................... FFA-35
The Value of Your Investment ....................................... FFA-35
Transfers .......................................................... FFA-36
Access to Your Money ............................................... FFA-37
Systematic Withdrawal Program for
Enhanced TSA and IRA Deferred Annuities ........................ FFA-37
Minimum Distribution ............................................. FFA-38
Contract Fee ....................................................... FFA-39
Charges ............................................................ FFA-39
Insurance-Related Charge ......................................... FFA-39
Investment-Related Charge ........................................ FFA-39
Annuity Taxes ...................................................... FFA-39
Early Withdrawal Charges ........................................... FFA-40
When No Early Withdrawal Charge Applies .......................... FFA-41
When Another Early Withdrawal Charge May Apply ................... FFA-43
Free Look .......................................................... FFA-44
Death Benefit ...................................................... FFA-44
Pay-out Options (or Income Options) ................................ FFA-45
FFA-2
<PAGE>
Income Annuities ........................................................ FFA-46
Income Payment Types ............................................... FFA-47
Purchasing an Income Annuity ....................................... FFA-48
Allocation of Your Purchase Payment ................................ FFA-48
The Value of Your Income Payments .................................. FFA-48
Transfers .......................................................... FFA-49
Contract Fee ....................................................... FFA-49
Charges ............................................................ FFA-49
Insurance-Related Charge ......................................... FFA-50
Investment-Related Charge ........................................ FFA-50
Annuity Taxes ...................................................... FFA-50
Free Look .......................................................... FFA-50
General Information ..................................................... FFA-51
Administration ..................................................... FFA-51
Purchase Payments ................................................ FFA-51
Confirming Transactions .......................................... FFA-51
Transactions by Telephone ........................................ FFA-52
Processing of Certain Transactions ............................... FFA-52
Valuation ........................................................ FFA-52
Advertising Performance ............................................ FFA-53
Changes to Your Deferred Annuity or Income Annuity ................. FFA-54
Voting Rights ...................................................... FFA-54
Who Sells the Deferred Annuities and Income Annuities .............. FFA-55
Financial Statements ............................................... FFA-56
Your Spouse's Rights ............................................... FFA-56
When We Can Cancel Your Deferred Annuity or Income Annuity ......... FFA-57
Income Taxes ............................................................ FFA-58
Table of Contents of the Statement of Additional Information ............ FFA-71
Appendix for Annuity Tax Table .......................................... FFA-72
Appendix II for Texas Optional Retirement Program ....................... FFA-73
MetLife does not intend to offer the Deferred Annuities or Income Annuities
anywhere they may not lawfully be offered and sold. MetLife has not authorized
any information or representations about the Deferred Annuities or Income
Annuities other than the information in this Prospectus, any attached
prospectus, supplements to the prospectuses or any supplemental sales material
we authorize.
FFA-3
<PAGE>
Important Terms You Should Know
Account Balance
When you purchase a Deferred Annuity an account is set up for you. Your Account
Balance is the total amount of money credited to you under your Deferred Annuity
including money in the investment divisions of the Separate Account and the
Fixed Interest Account.
Accumulation Unit Value
Under a Deferred Annuity, money paid-in or transferred into an investment
division of the Separate Account is credited to you in the form of accumulation
units. Accumulation units are established for each investment division. We
determine the value of these accumulation units each day the New York Stock
Exchange is open for regular trading. The values increase or decrease based on
the investment performance of the corresponding underlying portfolios.
Annuity Unit Value
Under an Income Annuity or variable payout option, the money paid-in or
transferred into an investment division of the Separate Account is held in the
form of annuity units. Annuity units are established for each investment
division. We determine the value of these annuity units each day the New York
Stock Exchange is open for regular trading. The values increase or decrease
based on the investment performance of the corresponding underlying portfolios.
Assumed Investment Return (AIR)
Under an income annuity, the AIR is a percentage rate of return assumed to
determine the amount of the first variable income payment. The AIR is also the
benchmark that is used to calculate the investment performance of a given
investment division to determine all subsequent payments to you.
Contract
A contract is the legal agreement between your employer or plan trustee and
MetLife or the certificate you receive under a group annuity contract between
MetLife and your employer, plan trustee or other entity. The contract and
certificate contains relevant provisions of your Deferred Annuity or Income
Annuity. MetLife issues contracts for each of the annuities described in this
Prospectus.
FFA-4
<PAGE>
Contract Year
Generally, the Contract Year for a Deferred Annuity is the period ending on the
last day of the month in which the anniversary of when we issue the annuity
occurs and each following 12 month period. However, depending on underwriting
and plan requirements, the first Contract Year may range from the initial three
to fifteen months the Deferred Annuity is issued.
Deferred Annuity
This term is used throughout this Prospectus when we are referring to both
Enhanced Deferred Annuities and Financial Freedom Deferred Annuities.
Early Withdrawal Charge
The early withdrawal charge is the amount we deduct from your Account Balance in
addition to your requested withdrawal amount if you withdraw money prematurely
from a Deferred Annuity. This charge is often referred to as a deferred sales
load or back-end load.
Income Annuity
This term is used throughout this Prospectus when we are referring to both
Enhanced Income Annuities and Financial Freedom Income Annuities.
Investment Division
Investment divisions are subdivisions of the Separate Account. When you allocate
or transfer money to an investment division, the investment division purchases
shares of a portfolio (with the same name) within the Metropolitan Fund, Calvert
Fund, Fidelity VIP or VIPII Funds.
MetLife
Metropolitan Life Insurance Company is the company that issues the Deferred
Annuities and Income Annuities. Throughout this Prospectus, MetLife is also
referred to as "we," "us" or "our."
MetLife Designated Office
The MetLife Designated Office is the MetLife office that will generally handle
the processing of all your requests concerning your Deferred Annuity or Income
Annuity. MetLife will notify you and provide you with the address of your
MetLife Designated Office.
FFA-5
<PAGE>
Separate Account
A separate account is an investment account. All assets contributed to
investment divisions under the Deferred Annuities and Income Annuities are
pooled in the Separate Account and maintained for the benefit of investors in
Deferred Annuities and Income Annuities.
You
In this Prospectus, depending on the context, "you" may mean either the
purchaser of the Deferred Annuity or Income Annuity, the annuitant under an
Income Annuity, the participant or annuitant for whom money is invested under
certain group arrangements. In cases where we are referring to giving
instructions or making payments to us, for PEDC, ss.403(b) tax sheltered
annuities, ss.451 deferred fee arrangements, ss.451 deferred compensation plans,
ss.457(f) deferred compensation plans, ss.457(e)(11) severance and death benefit
plans and ss.415(m) qualified governmental excess benefit arrangements, "you"
means such trustee or employer.
Variable Annuity
An annuity in which returns/income payments are based upon the performance of
investments such as stocks and bonds held by one or more underlying portfolios.
You assume the investment risk for amounts allocated to the investment divisions
in a variable annuity.
FFA-6
<PAGE>
TABLE OF EXPENSES -- ENHANCED PREFERENCE PLUS DEFERRED ANNUITIES AND
INCOME ANNUITIES
The following table shows the Separate Account, Metropolitan Fund, Calvert Fund
and Fidelity VIP and VIPII Funds charges and expenses you will incur. The table
is based on past experience and is subject to change. It is not intended to show
your actual expenses which may be higher or lower. The table does not show fees
for the Fixed Interest Account or the impact of annuity taxes. We have provided
examples to show you the impact of Separate Account, Metropolitan Fund, Calvert
Fund and Fidelity VIP and VIPII Funds charges and expenses on a hypothetical
investment of $1,000 and an assumed 5% return on the investment.
- --------------------------------------------------------------------------------
Separate Account, Metropolitan Fund, Calvert Fund and Fidelity VIP and VIPII
Funds expenses for the fiscal year ending December 31, 1998:
Contractowner Transaction Expenses For All Investment Divisions
Currently Offered
Sales Load Imposed on Purchases ................................ None
Deferred Sales Load (as a percentage of the purchase payment
funding the withdrawal during the accumulation period) (1) .... From 0% to 7%
Exchange Fee ............................................... None
Surrender Fee .............................................. None
Annual Contract Fee (2) .......................................... None
Separate Account Annual Expenses (as a percentage of average
account value) (3)
General Administrative Expenses Charge ..................... .20%
Mortality and Expense Risk Charge .......................... .75%
Total Separate Account Annual Expenses ..................... .95%
OTHER EXPENSES
Metropolitan Fund Annual Expenses MANAGEMENT AFTER EXPENSE
(as a percentage of average net assets) FEES REIMBURESEMENT TOTAL
- --------------------------------------------------------------------------------
State Street Research Aggressive Growth
Portfolio (4)(5)..............................
State Street Research Diversified
Portfolio (4)(5)..............................
State Street Research Growth Portfolio (4)(5)..
State Street Research Income Portfolio (4)(5)..
Harris Oakmark Large Cap Value
Portfolio (5)(7)..............................
Janus Mid Cap Portfolio (5)(6).................
Loomis Sayles High Yield Bond Portfolio (6)....
Neuberger&Berman Partners Mid Cap Value
Portfolio (5)(7)..............................
Santander International Stock
Portfolio (4)(5)..............................
Scudder Global Equity Portfolio (5)(6).........
T. Rowe Price Large Cap Growth
Portfolio (5)(7)..............................
T. Rowe Price Small Cap Growth
Portfolio (5)(6)..............................
Lehman Brothers Aggregate Bond Index
Portfolio (7).................................
MetLife Stock Index Portfolio (4)..............
Morgan Stanley EAFE(Registered) Index
Portfolio (7).................................
Russell 2000 Index Portfolio (7) ..............
FFA-7
<PAGE>
TABLE OF EXPENSES -- (continued)
OTHER EXPENSES
Calvert Fund MANAGEMENT AFTER EXPENSE
(as a percentage of average net assets) FEES REIMBURESEMENT TOTAL
- --------------------------------------------------------------------------------
Calvert Social Balanced Portfolio (8) ......
Calvert Social Mid Cap Growth
Portfolio (8)..............................
OTHER EXPENSES
Fidelity VIP and VIPII Funds MANAGEMENT AFTER EXPENSE
(as a percentage of average net assets) (9) FEES REIMBURESEMENT TOTAL
- --------------------------------------------------------------------------------
Fidelity VIPII Asset Manager ...............
Portfolio (10) ............................
Fidelity VIP Equity-Income
Portfolio (10) ............................
Fidelity VIP Growth Portfolio (10) .........
Fidelity VIPII Investment Grade Bond
Portfolio .................................
Fidelity VIP Overseas Portfolio (10) .......
Example
If you surrender your Deferred Annuity (withdraw all your money) at the end
of the time periods listed below, you would pay the following expenses on a
$1,000 investment in each investment division listed below, assuming a 5%
annual return on assets:
<TABLE>
<CAPTION>
1 3 5 10
YEAR YEARS YEARS YEARS
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
State Street Research Aggressive Growth Portfolio ....
State Street Research Diversified Portfolio ..........
State Street Research Growth Portfolio ...............
State Street Research Income Portfolio ...............
Calvert Social Balanced Portfolio ....................
Calvert Social Mid Cap Growth Portfolio ..............
Fidelity VIPII Asset Manager Portfolio ...............
Fidelity VIP Equity-Income Portfolio .................
Fidelity VIP Growth Portfolio ........................
Fidelity VIPII Investment Grade Bond Portfolio .......
Fidelity VIP Overseas Portfolio ......................
Harris Oakmark Large Cap Value Portfolio .............
Janus Mid Cap Portfolio ..............................
Loomis Sayles High Yield Bond Portfolio ..............
Neuberger&Berman Partners Mid Cap Value Portfolio ....
Santander International Stock Portfolio ..............
Scudder Global Equity Portfolio ......................
T. Rowe Price Large Cap Growth Portfolio .............
T. Rowe Price Small Cap Growth Portfolio .............
Lehman Brothers Aggregate Bond Index Portfolio .......
MetLife Stock Index Portfolio ........................
Morgan Stanley EAFE(Registered) Index Portfolio ......
Russell 2000 Index Portfolio .........................
</TABLE>
FFA-8
<PAGE>
TABLE OF EXPENSES -- (continued)
If you annuitize (elect a pay-out option under your Deferred Annuity) or do not
surrender your Deferred Annuity at the end of the time periods listed below, you
would pay the following expenses on a $1,000 investment in each investment
division listed below, assuming a 5% annual return on assets (11):
<TABLE>
<CAPTION>
1 3 5 10
YEAR YEARS YEARS YEARS
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
State Street Research Aggressive Growth Portfolio ....
State Street Research Diversified Portfolio ..........
State Street Research Growth Portfolio ...............
State Street Research Income Portfolio ...............
Calvert Social Balanced Portfolio ....................
Calvert Social Mid Cap Growth Portfolio ..............
Fidelity VIPII Asset Manager Portfolio ...............
Fidelity VIP Equity-Income Portfolio .................
Fidelity VIP Growth Portfolio ........................
Fidelity VIPII Investment Grade Bond Portfolio .......
Fidelity VIP Overseas Portfolio ......................
Harris Oakmark Large Cap Value Portfolio .............
Janus Mid Cap Portfolio ..............................
Loomis Sayles High Yield Bond Portfolio ..............
Neuberger&Berman Partners Mid Cap Value Portfolio ....
Santander International Stock Portfolio ..............
Scudder Global Equity Portfolio ......................
T. Rowe Price Large Cap Growth Portfolio .............
T. Rowe Price Small Cap Growth Portfolio .............
Lehman Brothers Aggregate Bond Index Portfolio .......
MetLife Stock Index Portfolio ........................
Morgan Stanley EAFE(Registered) Index Portfolio ......
Russell 2000 Index Portfolio .........................
</TABLE>
FFA-9
<PAGE>
TABLE OF EXPENSES -- FINANCIAL FREEDOM DEFERRED ANNUITIES AND INCOME ANNUITIES
The following table shows the Separate Account, Metropolitan Fund, Calvert Fund
and Fidelity VIP and VIPII Funds charges and expenses you will incur. The table
is based on past experience and is subject to change. It is not intended to show
your actual expenses which may be higher or lower. The table does not show fees
for the Fixed Interest Account or the impact of annuity taxes. We have provided
examples to show you the impact of Separate Account, Metropolitan Fund, Calvert
Fund and Fidelity VIP and VIPII Funds charges and expenses on a hypothetical
investment of $1,000 that has an assumed 5% return on the investment.
- --------------------------------------------------------------------------------
Separate Account, Metropolitan Fund, Calvert Fund and Fidelity VIP and VIPII
Funds expenses for the fiscal year ending December 31, 1998:
Contractowner Transaction Expenses For All Investment Divisions
Currently Offered
Sales Load Imposed on Purchases ........................................ None
Deferred Sales Load (as a percentage of the purchase payment
funding the withdrawal during the accumulation period) ............... None
Exchange Fee ....................................................... None
Surrender Fee ...................................................... None
Annual Contract Fee (2) .................................................. None
Separate Account Annual Expenses (as a percentage of average
account value) (3)
General Administrative Expenses Charge ............................. .20%
Mortality and Expense Risk Charge .................................. .75%
Total Separate Account Annual Expenses ............................. .95%
OTHER EXPENSES
Metropolitan Fund Annual Expenses MANAGEMENT AFTER EXPENSE
(as a percentage of average net assets) FEES REIMBURESEMENT TOTAL
- --------------------------------------------------------------------------------
State Street Research Aggressive Growth
Portfolio (4)(5)....................................
State Street Research Diversified
Portfolio (4)(5)....................................
State Street Research Growth Portfolio (4)(5)........
State Street Research Income Portfolio (4)(5)........
Harris Oakmark Large Cap
Value Portfolio (5)(7)..............................
Janus Mid Cap Portfolio (5)(6).......................
Loomis Sayles High Yield Bond Portfolio (6)..........
Neuberger&Berman Partners Mid Cap Value
Portfolio (5)(7)....................................
Santander International Stock
Portfolio (4)(5)....................................
Scudder Global Equity Portfolio (5)(6) ..............
T. Rowe Price Large Cap Growth
Portfolio (5)(7)....................................
T. Rowe Price Small Cap Growth
Portfolio (5)(6)....................................
Lehman Brothers Aggregate Bond Index
Portfolio (7).......................................
MetLife Stock Index Portfolio (4)....................
Morgan Stanley EAFE(Registered) Index Portfolio (7)..
Russell 2000 Index Portfolio (7).....................
FFA-10
<PAGE>
TABLE OF EXPENSES -- (continued)
OTHER EXPENSES
Calvert Fund MANAGEMENT AFTER EXPENSE
(as a percentage of average net assets) FEES REIMBURESEMENT TOTAL
- --------------------------------------------------------------------------------
Calvert Social Balanced Portfolio (8) ......
Calvert Social Mid Cap Growth
Portfolio (8)..............................
OTHER EXPENSES
Fidelity VIP and VIPII Funds MANAGEMENT AFTER EXPENSE
(as a percentage of average net assets) (9) FEES REIMBURESEMENT TOTAL
- --------------------------------------------------------------------------------
Fidelity VIPII Asset Manager ...............
Portfolio (10) ............................
Fidelity VIP Equity-Income
Portfolio (10) ............................
Fidelity VIP Growth Portfolio (10) .........
Fidelity VIPII Investment Grade Bond
Portfolio .................................
Fidelity VIP Overseas Portfolio (10) .......
Example
If you surrender your Deferred Annuity (withdraw all your money) at the end
of the time periods listed below, you would pay the following expenses on a
$1,000 investment in each investment division listed below, assuming a 5%
annual return on assets:
<TABLE>
<CAPTION>
1 3 5 10
YEAR YEARS YEARS YEARS
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
State Street Research Aggressive Growth Portfolio ....
State Street Research Diversified Portfolio ..........
State Street Research Growth Portfolio ...............
State Street Research Income Portfolio ...............
Calvert Social Balanced Portfolio ....................
Calvert Social Mid Cap Growth Portfolio ..............
Fidelity VIPII Asset Manager Portfolio ...............
Fidelity VIP Equity-Income Portfolio .................
Fidelity VIP Growth Portfolio ........................
Fidelity VIPII Investment Grade Bond Portfolio .......
Fidelity VIP Overseas Portfolio ......................
Harris Oakmark Large Cap Value Portfolio .............
Janus Mid Cap Portfolio ..............................
Loomis Sayles High Yield Bond Portfolio ..............
Neuberger&Berman Partners Mid Cap Value Portfolio ....
Santander International Stock Portfolio ..............
Scudder Global Equity Portfolio ......................
T. Rowe Price Large Cap Growth Portfolio .............
T. Rowe Price Small Cap Growth Portfolio .............
Lehman Brothers Aggregate Bond Index Portfolio .......
MetLife Stock Index Portfolio ........................
Morgan Stanley EAFE(Registered) Index Portfolio ......
Russell 2000 Index Portfolio .........................
</TABLE>
FFA-11
<PAGE>
TABLE OF EXPENSES -- (continued)
If you annuitize (elect a pay-out option under your Deferred Annuity) or do not
surrender your Deferred Annuity at the end of the time periods listed below, you
would pay the following expenses on a $1,000 investment in each investment
division listed below, assuming a 5% annual return on assets (11):
<TABLE>
<CAPTION>
1 3 5 10
YEAR YEARS YEARS YEARS
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
State Street Research Aggressive Growth Portfolio ....
State Street Research Diversified Portfolio ..........
State Street Research Growth Portfolio ...............
State Street Research Income Portfolio ...............
Calvert Social Balanced Portfolio ....................
Calvert Social Mid Cap Growth Portfolio ..............
Fidelity VIPII Asset Manager Portfolio ...............
Fidelity VIP Equity-Income Portfolio .................
Fidelity VIP Growth Portfolio ........................
Fidelity VIPII Investment Grade Bond Portfolio .......
Fidelity VIP Overseas Portfolio ......................
Harris Oakmark Large Cap Value Portfolio .............
Janus Mid Cap Portfolio ..............................
Loomis Sayles High Yield Bond Portfolio ..............
Neuberger&Berman Partners Mid Cap Value Portfolio ....
Santander International Stock Portfolio ..............
Scudder Global Equity Portfolio ......................
T. Rowe Price Large Cap Growth Portfolio .............
T. Rowe Price Small Cap Growth Portfolio .............
Lehman Brothers Aggregate Bond Index Portfolio .......
MetLife Stock Index Portfolio ........................
Morgan Stanley EAFE(Registered) Index Portfolio ......
Russell 2000 Index Portfolio .........................
</TABLE>
FFA-12
<PAGE>
TABLE OF EXPENSES (continued)
1 There are times when the early withdrawal charge does not apply to amounts
that are withdrawn from a Deferred Annuity. Each Contract Year you may take
the greater of 20% (10% for certain Enhanced Deferred Annuities) of your
Account Balance or your purchase payments made over 7 years ago free of early
withdrawal charges. There are no early withdrawal charges applied to the
Enhanced Non-Qualified Deferred Annuities for Section 457(f) deferred
compensation plans, Section 451 deferred fee arrangements, Section 451
deferred compensation plans and Section 457(e)(11) severance and death
benefit plans.
2 A $20 annual contract fee may be imposed on money in the Fixed Interest
Account. This fee may be waived under certain circumstances.
3 Our total Separate Account Annual Expenses will not exceed .95% of your
average balance in the investment divisions. For purposes of presentation
here, we estimated the allocation between general administrative expenses and
the mortality and expense risk charge.
4 Prior to May 16, 1993, we paid all expenses of the Metropolitan Fund (other
than management fees, brokerage commissions, taxes, interest and
extraordinary or non-recurring expenses).
5 We anticipate that the marginal rate of the investment management fee for the
Portfolio will decrease when the size of the Portfolio reaches certain
pre-established dollar levels.
6 These Portfolios began operations on March 3, 1997. We paid all expenses
(other than management fees, brokerage commissions, taxes, interest and
extraordinary or non-recurring expenses) in excess of .20% of the average net
assets for each of the following Portfolios until the Portfolio's total
assets reached $100 million, or until March 2, 1999, whichever came first:
OTHER EXPENSES DATE
WITHOUT REIMBURSEMENT
REIMBURSEMENT STOPPED
- -------------------------------------------------------------------------------
Loomis Sayles High Yield Bond
T. Rowe Price Small Cap Growth January 23, 1998
Janus Mid Cap December 31, 1997
Scudder Global Equity July 1, 1998
If we had not reimbursed the Portfolios for these expenses, the "other expenses"
for the Portfolios would have been those listed above.
7 These Portfolios began operations on November 9, 1998. We pay all expenses
(other than management fees, brokerage commissions, taxes, interest and
extraordinary or non-recurring expenses) in excess of .20% (.25% for the
Morgan Stanley EAFE(Registered) Index Portfolio) of the average net assets
for each of the following Portfolios until the Portfolio's total assets reach
$100 million, or until November 8, 2000, whichever comes first:
OTHER EXPENSES
WITHOUT
REIMBURSEMENT
- -------------------------------------------------------------------------------
Harris Oakmark Large Cap Value
Lehman Brothers Aggregate Bond Index
Neuberger&Berman Partners Mid Cap Value
Russell 2000 Index
T. Rowe Price Large Cap Growth Portfolio
Morgan Stanley EAFE(Registered) Index
If we had not reimbursed the Portfolios for these expenses, the "other expenses"
for the Portfolios would have been those listed above.
FFA-13
<PAGE>
8 The Calvert Fund Portfolios' management fees may go up or down based on the
Portfolios' performance. The management fees may range from % to %
for the Calvert Social Balanced Portfolio and from % to % for
Calvert Social Mid Cap Growth Portfolio. In addition, the numbers shown in
the table reflect an increase of .01% which is attributed to an increase in
transfer agency expenses. Part of the Portfolios' other expenses are paid by
a third party. If some of the Portfolios' other expenses had not been
reimbursed its other expenses would have been % for the Calvert Social
Balanced Portfolio and % for the Calvert Social Mid Cap Growth
Portfolio.
9 The Fidelity Funds each have a Distribution and Service Plan to help pay
distribution costs (commonly known as a Rule 12b-1 plan). These plans prevent
the Fidelity Funds Portfolios from paying any such costs. Rather, Fidelity
Management Research Company ("FMR") may use its management fee or other
assets to pay expenses for selling shares of the Fidelity Funds Portfolios,
including expenses of third parties. FMR or Fidelity Distributors Corp. pays
MetLife for providing certain distribution and shareholder services. Fidelity
Investments Institutional Operations Company, Inc. also pays MetLife for
providing administrative services. You are not responsible for these fees.
FMR and its affiliates absorb the fees paid to MetLife.
10 Some of the brokerage commissions received have been used to pay the
Portfolios' expenses. This has the effect of reducing the Portfolios'
expenses. Also, the Portfolios' custodian and transfer agent may use interest
earned on uninvested cash to reduce the Portfolios' expenses. If some of the
Portfolios' expenses had not been reimbursed their expenses would have been
as follows:
11 The income option you choose when you decide to exercise a pay-out option
under your Deferred Annuity must be a life annuity or have scheduled payments
for a period of at least five years to avoid the early withdrawal change.
OTHER EXPENSES
WITHOUT
REIMBURSEMENT
- ---------------------------------------------------------------------------
Fidelity VIP Asset Manager
Fidelity VIP Equity-Income
Fidelity VIP Growth
Fidelity VIP Overseas
In 1998, the Separate Account annual expenses we received for all Separate
Account annuities was $ .
FFA-14
<PAGE>
ACCUMULATION UNIT VALUES FOR EACH INVESTMENT DIVISION
(For an accumulation unit outstanding throughout the period)
These tables and bar charts show fluctuations in the Accumulation Unit Values
for Enhanced Deferred Annuities for each investment division from year end to
year end. The information in this table has been derived from the Separate
Account's full financial statements or other reports (such as the annual
report). The financial statements are audited annually by Deloitte & Touche LLP,
who are independent auditors. The full financial statements and related notes
appear in the SAI.
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
NUMBER OF
BEGINNING OF YEAR END OF YEAR ACCUMULATION
ACCUMULATION ACCUMULATION UNITS END OF YEAR
ENHANCED PREFERENCE PLUS DEFERRED ANNUITIES (a) YEAR UNIT VALUE UNIT VALUE (IN THOUSANDS)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
State Street Research Aggressive Growth Division 1998 $38.02 00.00
1997 35.98 38.02 1,572
[YEAR END ACCUMULATION UNIT VALUE 1996 33.72 35.98 1,396
BAR CHARTS OMITTED FOR THIS DIVISION 1995 26.29 33.72 997
AND EACH OF THE 18 FOLLOWING DIVISIONS] 1994 27.05 26.29 625
1993 22.26 27.05 358
1992 20.37 22.26 134
1991 12.35 20.37 7
1990 14.85(b) 12.35 0
State Street Research Diversified Division 1998 33.57
1997 28.11 33.57 515
1996 24.78 28.11 365
1995 19.69 24.78 333
1994 20.51 19.69 241
1993 18.36 20.51 125
1992 16.93 18.36 28
1991 13.68 16.93 3
1990 14.34(b) 13.68 0
</TABLE>
FFA-15
<PAGE>
ACCUMULATION UNIT VALUES (continued)
(For an accumulation unit outstanding throughout the period)
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
NUMBER OF
BEGINNING OF YEAR END OF YEAR ACCUMULATION
ACCUMULATION ACCUMULATION UNITS END OF YEAR
ENHANCED PREFERENCE PLUS DEFERRED ANNUITIES YEAR UNIT VALUE UNIT VALUE (IN THOUSANDS)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
State Street Research Growth Division............................ 1998 $60.00
1997 47.19 60.00 656
1996 38.99 47.19 436
1995 29.57 38.99 324
1994 30.85 29.57 197
1993 27.22 30.85 123
1992 24.63 27.22 47
1991 18.67 24.63 7
1990 21.66(b) 18.67 0
State Street Research Income Division............................ 1998 32.77
1997 30.13 32.77 314
1996 29.36 30.13 272
1995 24.79 29.36 213
1994 25.83 24.79 155
1993 23.43 25.83 111
1992 22.12 23.43 51
1991 19.02 22.12 3
1990 17.91(b) 19.02 0
Calvert Social Balanced Division................................. 1998 20.32
1997 17.08 20.32 225
1996 15.31 17.08 179
1995 11.91 15.31 129
1994 12.43 11.91 90
1993 11.62 12.43 66
1992 10.90 11.62 27
1991 10.00(c) 10.90 2
</TABLE>
FFA-16
<PAGE>
ACCUMULATION UNIT VALUES (continued)
(For an accumulation unit outstanding throughout the period)
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
NUMBER OF
BEGINNING OF YEAR END OF YEAR ACCUMULATION
ACCUMULATION ACCUMULATION UNITS END OF YEAR
ENHANCED PREFERENCE PLUS DEFERRED ANNUITIES YEAR UNIT VALUE UNIT VALUE (IN THOUSANDS)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Calvert Social Mid Cap Growth Division........................... 1998 $20.58
1997 16.81 20.58 80
1996 15.80 16.81 57
1995 11.43 15.80 18
1994 12.81 11.43 2
1993 12.03 12.81 1
1992 10.78(d) 12.03 0
Fidelity Investment Grade Bond Division.......................... 1998 15.62
1997 14.46 15.62 235
1996 14.15 14.46 165
1995 12.17 14.15 89
1994 12.77 12.17 24
1993 11.62 12.77 7
1992 10.99(d) 11.62 1
Fidelity Asset Manager Division.................................. 1998 20.94
1997 17.52 20.94 1,346
1996 15.44 17.52 1,118
1995 13.32 15.44 1,066
1994 14.32 13.32 728
1993 11.94 14.32 292
1992 11.23(d) 11.94 81
</TABLE>
FFA-17
<PAGE>
ACCUMULATION UNIT VALUES (continued)
(For an accumulation unit outstanding throughout the period)
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
NUMBER OF
BEGINNING OF YEAR END OF YEAR ACCUMULATION
ACCUMULATION ACCUMULATION UNITS END OF YEAR
ENHANCED PREFERENCE PLUS DEFERRED ANNUITIES YEAR UNIT VALUE UNIT VALUE (IN THOUSANDS)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Fidelity Money Market Division (e)............................... 1998 $12.24
1997 11.85 12.24 0
1996 11.46 11.85 0
1995 11.02 11.46 0
1994 10.72 11.02 12
1993 10.50 10.72 0
1992 10.33 10.50 0
Fidelity Equity-Income Division.................................. 1998 30.45
1997 23.99 30.45 2,476
1996 21.19 23.99 1,775
1995 15.84 21.19 1,200
1994 15.02 15.84 513
1993 12.83 15.02 195
1992 11.75(d) 12.83 27
Fidelity Growth Division......................................... 1998 29.30
1997 23.95 29.30 2,249
1996 21.08 23.95 1,757
1995 15.72 21.08 1,218
1994 15.87 15.72 641
1993 13.43 15.87 290
1992 12.05(d) 13.43 93
</TABLE>
FFA-18
<PAGE>
ACCUMULATION UNIT VALUES (continued)
(For an accumulation unit outstanding throughout the period)
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
NUMBER OF
BEGINNING OF YEAR END OF YEAR ACCUMULATION
ACCUMULATION ACCUMULATION UNITS END OF YEAR
ENHANCED PREFERENCE PLUS DEFERRED ANNUITIES YEAR UNIT VALUE UNIT VALUE (IN THOUSANDS)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Fidelity Overseas Division....................................... 1998 $17.77
1997 16.08 17.77 647
1996 14.34 16.08 397
1995 13.20 14.34 197
1994 13.10 13.20 93
1993 9.63 13.10 27
1992 11.22(d) 9.63 4
Janus Mid Cap Division........................................... 1998 12.72
1997 10.00(f) 12.72 167
Loomis Sayles High Yield Bond Division........................... 1998 10.53
1997 10.00(f) 10.53 49
Santander International Stock Division........................... 1998 13.54
1997 13.99 13.54 853
1996 14.38 13.99 868
1995 14.40 14.38 814
1994 13.84 14.40 558
1993 9.45 13.84 191
1992 10.63 9.45 50
1991 10.00(g) 10.63 4
</TABLE>
FFA-19
<PAGE>
ACCUMULATION UNIT VALUES (continued)
(For an accumulation unit outstanding throughout the period)
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
NUMBER OF
BEGINNING OF YEAR END OF YEAR ACCUMULATION
ACCUMULATION ACCUMULATION UNITS END OF YEAR
ENHANCED PREFERENCE PLUS DEFERRED ANNUITIES YEAR UNIT VALUE UNIT VALUE (IN THOUSANDS)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Scudder Global Equity Division................................... 1998 $10.88
1997 10.00(f) 10.88 120
T. Rowe Price Small Cap Growth Division.......................... 1998 11.79
1997 10.00(f) 11.79 279
MetLife Stock Index Division..................................... 1998 32.50
1997 24.83 32.50 2,504
1996 20.44 24.83 1,648
1995 15.07 20.44 1,062
1994 15.04 15.07 631
1993 13.86 15.04 507
1992 13.02 13.86 260
1991 10.13 13.02 0
1990 10.85(b) 10.13 0
Harris Oakmark Large Cap Value Division.......................... 1998 10.00(h)
Lehman Brothers Aggregate Bond Division.......................... 1998 10.00(h)
Morgan Stanley EAFE(Registered) Index Division................... 1998 10.00(h)
Neuberger&Berman Partners Mid Cap Value Division................. 1998 10.00(h)
Russell 2000 Index Division...................................... 1998 10.00(h)
T. Rowe Price Large Cap Growth Division.......................... 1998 10.00(h)
</TABLE>
FFA-20
<PAGE>
ACCUMULATION UNIT VALUES (continued)
(For an accumulation unit outstanding throughout the period)
- ------------
In addition to the above mentioned Accumulation Units, there were cash reserves
of $ as of December 31, 1998, applicable to Income Annuities (including those
not described in this Prospectus) receiving annuity payouts.
(a) Not all investment divisions are offered under the various Enhanced Deferred
Annuities.
(b) Inception Date July 2, 1990.
(c) Inception Date May 1, 1991.
(d) Inception Date May 1, 1992.
(e) No longer offered under the Enhanced Deferred Annuities
(f) Inception Date March 3, 1997.
(g) Inception Date July 1, 1991. Sales commenced for Non-Qualified Enhanced
Deferred Annuities for Section 457(f) deferred compensation plans,
Section 451 deferred fee arrangements, Section 451 deferred compensation
plans and Section 451(e)(11) severance and death benefit plans in 1991.
(h) Inception Date November 9, 1998. A bar chart does not appear for this
investment division because there is less than one calendar year of
performance history.
FFA-21
<PAGE>
ACCUMULATION UNIT VALUES FOR EACH INVESTMENT DIVISION
(For an accumulation unit outstanding throughout the period)
These tables and bar charts show fluctuations in the Accumulation Unit Values
for Financial Freedom Deferred Annuities for each investment division from year
end to year end. The information in this table has been derived from the
Separate Account's full financial statements, or other reports (such as the
annual report). The financial statements are audited annually by Deloitte &
Touche LLP, who are independent auditors. The full financial statements and
related notes appear in the SAI.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
NUMBER OF
BEGINNING OF YEAR END OF YEAR ACCUMULATION
ACCUMULATION ACCUMULATION UNITS END OF YEAR
FINANCIAL FREEDOM DEFERRED ANNUITIES YEAR UNIT VALUE UNIT VALUE (IN THOUSANDS)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
State Street Research Aggressive Growth Division................. 1998 $38.02
1997 35.98 38.02 14
[YEAR END ACCUMULATION UNIT VALUE 1996 33.72(a) 35.98 3
BAR CHARTS OMITTED FOR THIS DIVISION
AND EACH OF THE 18 FOLLOWING DIVISIONS]
State Street Research Diversified Division....................... 1998 33.57
1997 28.11 33.57 20
1996 24.78(a) 28.11 0
State Street Research Growth Division............................ 1998 60.00
1997 47.19 60.00 32
1996 38.99(a) 47.19 0
</TABLE>
FFA-22
<PAGE>
ACCUMULATION UNIT VALUES (continued)
(For an accumulation unit outstanding throughout the period)
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
NUMBER OF
BEGINNING OF YEAR END OF YEAR ACCUMULATION
ACCUMULATION ACCUMULATION UNITS END OF YEAR
FINANCIAL FREEDOM DEFERRED ANNUITIES YEAR UNIT VALUE UNIT VALUE (IN THOUSANDS)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
State Street Research Income Division............................ 1998 $32.77
1997 30.13 32.77 5
1996 29.36(a) 30.13 0
Calvert Social Balanced Division................................. 1998 20.35
1997 17.11 20.35 162
1996 15.34 17.11 120
1995 11.93 15.34 82
1994 12.45 11.93 56
1993 11.63 12.45 35
1992 10.91 11.63 22
1991 10.00(b) 10.91 0
Calvert Social Mid Cap Growth Division........................... 1998 20.58
1997 16.81 20.58 118
1996 15.80 16.81 108
1995 11.43 15.80 62
1994 12.81 11.43 44
1993 12.03 12.81 29
1992 10.67 12.03 16
1991 10.00(b) 10.67 0
Fidelity Money Market Division................................... 1998 12.24
1997 11.85 12.24 81
1996 11.46 11.85 101
1995 11.02 11.46 41
1994 10.72 11.02 26
1993 10.50 10.72 19
1992 10.22 10.50 12
1991 10.00(b) 10.22 1,146
</TABLE>
FFA-23
<PAGE>
ACCUMULATION UNIT VALUES (continued)
(For an accumulation unit outstanding throughout the period)
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
NUMBER OF
BEGINNING OF YEAR END OF YEAR ACCUMULATION
ACCUMULATION ACCUMULATION UNITS END OF YEAR
FINANCIAL FREEDOM DEFERRED ANNUITIES YEAR UNIT VALUE UNIT VALUE (IN THOUSANDS)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Fidelity Equity-Income Division.................................. 1998 $30.45
1997 23.99 30.45 906
1996 21.19 23.99 659
1995 15.84 21.19 445
1994 15.02 15.84 270
1993 12.83 15.02 165
1992 11.07 12.83 66
1991 10.00(b) 11.07 4
Fidelity Growth Division......................................... 1998 29.30
1997 23.95 29.30 1,317
1996 21.08 23.95 1,058
1995 15.72 21.08 762
1994 15.87 15.72 508
1993 13.43 15.87 317
1992 12.40 13.43 136
1991 10.00(b) 12.40 30
Fidelity Overseas Division....................................... 1998 17.77
1997 16.08 17.77 508
1996 14.34 16.08 365
1995 13.20 14.34 259
1994 13.10 13.20 197
1993 9.63 13.10 98
1992 10.89 9.63 24
1991 10.00(b) 10.89 4
</TABLE>
FFA-24
<PAGE>
ACCUMULATION UNIT VALUES (continued)
(For an accumulation unit outstanding throughout the period)
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
NUMBER OF
BEGINNING OF YEAR END OF YEAR ACCUMULATION
ACCUMULATION ACCUMULATION UNITS END OF YEAR
FINANCIAL FREEDOM DEFERRED ANNUITIES YEAR UNIT VALUE UNIT VALUE (IN THOUSANDS)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Fidelity Investment Grade Bond Division.......................... 1998 $15.62
1997 14.46 15.62 170
1996 14.15 14.46 133
1995 12.17 14.15 115
1994 12.77 12.17 72
1993 11.62 12.77 46
1992 11.00 11.62 25
1991 10.00(b) 11.00 2
Fidelity Asset Manager Division.................................. 1998 20.94
1997 17.52 20.94 816
1996 15.44 17.52 742
1995 13.32 15.44 600
1994 14.32 13.32 511
1993 11.94 14.32 309
1992 10.78 11.94 111
1991 10.00(b) 10.78 12
Janus Mid Cap Division........................................... 1998 12.72
1997 10.00(d) 12.72 52
</TABLE>
FFA-25
<PAGE>
ACCUMULATION UNIT VALUES (continued)
(For an accumulation unit outstanding throughout the period)
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
NUMBER OF
BEGINNING OF YEAR END OF YEAR ACCUMULATION
ACCUMULATION ACCUMULATION UNITS END OF YEAR
FINANCIAL FREEDOM DEFERRED ANNUITIES YEAR UNIT VALUE UNIT VALUE (IN THOUSANDS)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Loomis Sayles High Yield Bond Division........................... 1998 $10.53
1997 10.00(d) 10.53 8
Santander International Stock Division........................... 1998 13.54
1997 13.99 13.54 10
1996 14.38(a) 13.99 0
Scudder Global Equity Division................................... 1998 10.88
1997 10.00(d) 10.88 56
T. Rowe Price Small Cap Growth Division.......................... 1998 11.79
1997 10.00(d) 11.79 108
</TABLE>
FFA-26
<PAGE>
ACCUMULATION UNIT VALUES (continued)
(For an accumulation unit outstanding throughout the period)
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
NUMBER OF
BEGINNING OF YEAR END OF YEAR ACCUMULATION
ACCUMULATION ACCUMULATION UNITS END OF YEAR
FINANCIAL FREEDOM DEFERRED ANNUITIES YEAR UNIT VALUE UNIT VALUE (IN THOUSANDS)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
MetLife Stock Index Division..................................... 1998 $27.72
1997 21.18 27.72 799
1996 17.43 21.18 514
1995 12.86 17.43 310
1994 12.83 12.86 226
1993 11.82 12.83 150
1992 11.11 11.82 1,999
1991 10.00(b) 11.11 2,181
Harris Oakmark Large Cap Value Division.......................... 1998 10.00(e)
Lehman Brothers Aggregate Bond Division.......................... 1998 10.00(e)
Morgan Stanley EAFE(Registered) Index Division................... 1998 10.00(e)
Neuberger&Berman Partners Mid Cap Value Division................. 1998 10.00(e)
Russell 2000 Index Division...................................... 1998 10.00(e)
T. Rowe Price Large Cap Growth Division.......................... 1998 10.00(e)
</TABLE>
- ------------
In addition to the above mentioned Accumulation Units, there were cash reserves
of $ as of December 31, 1998, applicable to Income Annuities (including those
not described in this Prospectus) receiving annuity payouts.
(a) Inception Date May 1, 1996.
(b) Inception Date July 1, 1991.
(c) Inception Date May 1, 1991.
(d) Inception Date March 3, 1997.
(e) Inception Date November 9, 1998. A bar chart does not appear for this
investment division because there is less than one year of performance
history.
FFA-27
<PAGE>
MetLife
Our main office is located at One Madison Avenue, New York, New York 10010.
Headquartered in New York City since 1868, MetLife is one of the world's largest
financial services companies and a leader in life insurance sales in the United
States. With approximately $ billion worth of assets under management as of
December 31, 1998, MetLife serves 37 million people around the world and manages
pension plans for many Fortune 500 companies. The more than 41,000 associates in
the MetLife family provide or administer life, health and property/casualty
insurance, annuities, mutual funds as well as other kinds of savings, retirement
and financial products and services for individuals and groups.
We are a mutual life insurance company. In November 1998, MetLife announced its
intention to convert to a stock company from a mutual company. MetLife's board
of directors authorized the development of a plan to "demutualize." The plan
will be subject to approval by the board of directors, the State of New York
Insurance Department and policyholders. As of April 30, 1999, we do not know the
details of the plan or when or if it will take effect.
Metropolitan Life Separate Account E
We established Metropolitan Life Separate Account E on September 27, 1983. The
purpose of the Separate Account is to hold the variable assets that underlie the
Enhanced Preference Plus Account and Financial Freedom Account Variable Annuity
Contracts and some other variable annuity contracts we issue. We have registered
the Separate Account with the Securities and Exchange Commission as a unit
investment trust under the Investment Company Act of 1940.
The Separate Account's assets are solely for the benefit of those who invest in
the Separate Account and no one else, including our creditors. We are obligated
to pay all money we owe under the Deferred Annuities and Income Annuities even
if that amount exceeds the assets in the Separate Account. The assets of the
Separate Account are held in our name on behalf of the Separate Account and
legally belong to us. All the income, gains, and losses (realized or unrealized)
resulting from these assets are credited to or charged against the contracts
issued from this Separate Account without regard to our other business.
FFA-28
<PAGE>
The Variable Annuities in this Prospectus
There are two types of variable annuities described in this Prospectus: Deferred
Annuities and Income Annuities. These annuities are "variable" because the value
of your account or income varies based on the investment performance of the
investment divisions you choose. In short, the value of your Deferred Annuity,
your income payments under a variable pay-out option of your Deferred Annuity,
or your income payments under your Income Annuity, may go up or down. Since the
investment performance is not guaranteed, your money is at risk. The degree of
risk will depend on the investment divisions you select. The Accumulation Unit
Value or Annuity Unit Value for each investment division rises or falls based on
the investment performance (or "experience") of the Portfolio with the same
name.
________________________________________________________________________________
The group Deferred Annuities and group Income Annuities described in this
Prospectus are offered to an employer, association, trust or other group for its
employees, members or participants.
________________________________________________________________________________
The Deferred Annuities have a fixed interest rate option called the Fixed
Interest Account. With the Fixed Interest Account, your money earns a rate of
interest that we guarantee. Income Annuities and the variable pay-out options
under the Deferred Annuities have a fixed payment option called the Fixed Income
Option. Under the Fixed Income Option, we guarantee the amount of your fixed
income payments. These fixed options are not described in this Prospectus
although we occasionally refer to them.
A Deferred Annuity
You accumulate money in your account during the pay-in phase by making one or
more purchase payments. MetLife will hold your money and credit investment
returns as long as the money remains in your account.
________________________________________________________________________________
A Deferred Annuity consists of two phases: the accumulation or "pay-in" phase
and the income annuity or "pay-out" phase.
________________________________________________________________________________
The pay-out phase begins when you either take all of your money out of the
account or elect to have us pay you "income" payments using the money in your
account. The number and the amount of the income payments you receive will
depend on such things as the pay-out option you choose, your investment choices,
and the amount used to provide your income payments. Because Deferred Annuities
offer various insurance benefits such as pay-out options, including our
guarantee of income for your lifetime, the Deferred Annuities are "annuities."
An Income Annuity
An Income Annuity, also known as an immediate annuity, only has a "pay-out"
phase. You make a single purchase payment and select the type of pay-out option
suited to your needs. Some of the pay-out options guarantee an income stream for
your lifetime or your and another's lifetimes. Some Income Annuities guarantee a
time period of your choice
FFA-29
<PAGE>
over which MetLife will make income payments. Income Annuities also have other
features. The amount of your income payments you receive will depend on such
things as the type of pay-out option you choose, your investment choices and the
amount of your purchase payment.
Your Investment Choices
The investment choices are:
________________________________________________________________________________
The degree of investment risk you assume will depend on the investment divisions
you choose. We have listed your choices in order of risk from the most
conservative to the most aggressive.
________________________________________________________________________________
Fidelity's VIP Money Market Portfolio
Lehman Brothers Aggregate Bond Index Portfolio
State Street Research Income Portfolio
Fidelity's VIPII Investment Grade Bond Portfolio
State Street Research Diversified Portfolio
Fidelity's VIPII Asset Manager Portfolio
Calvert Social Balanced Portfolio
MetLife Stock Index Portfolio
Fidelity's VIP Equity-Income Portfolio
Harris Oakmark Large Cap Value Portfolio
T. Rowe Price Large Cap Growth Portfolio
State Street Research Growth Portfolio
Neuberger & Berman Partners Mid Cap Value Portfolio
Janus Mid Cap Portfolio Calvert Social Mid Cap Growth Portfolio
Loomis Sayles High Yield Bond Portfolio
State Street Research Aggressive Growth Portfolio
Russell 2000 Index Portfolio
Fidelity's VIP Growth Portfolio
T. Rowe Price Small Cap Growth Portfolio
Scudder Global Equity Portfolio
Morgan Stanley EAFE(Registered) Index Portfolio
Santander International Stock Portfolio
Fidelity's VIP Overseas Portfolio
________________________________________________________________________________
There is a possibility you will lose principal in the investment choices.
However, they generally offer the opportunity for greater returns over the long
term than our guaranteed fixed options.
________________________________________________________________________________
Some of the investment choices may not be available under the terms of the
Deferred Annuity or Income Annuity. The contract will indicate the investment
divisions that are available to you. Your investment choices may be limited
because:
o Some of the investment divisions are not approved in your state.
FFA-30
<PAGE>
o Your employer, association or other group contractholder limits the number of
available investment divisions.
o We have restricted the available investment divisions.
o For Income Annuities, some states limit you to four choices (four investment
divisions or three investment divisions and the Fixed Income Option).
The investment divisions buy and sell shares of corresponding mutual fund
portfolios. These Portfolios, which are part of the Metropolitan Fund, Calvert
Fund or Fidelity VIP and VIPII Funds, invest in stocks, bonds and other
investments. All dividends declared by the Portfolios are earned by the Separate
Account and reinvested. Therefore, no dividends are distributed to you under the
Deferred Annuities or Income Annuities. Dividends generally are reflected in an
increase in the Accumulation or Annuity Unit Value. You pay no transaction
expenses (i.e., front end or back-end load sales charges) as a result of the
Separate Account's purchase or sale of these mutual fund shares. The Portfolios
of the Metropolitan Fund are available only by purchasing MetLife annuities and
life insurance policies and are never sold directly to the public. The Calvert
Fund and Fidelity VIP and VIPII Funds Portfolios are made available by the funds
only through various insurance company annuities and life insurance policies.
________________________________________________________________________________
While the investment divisions and their comparably named Portfolios may have
names, investment objectives and management which are identical or similar to
publicly available mutual funds, these are not those mutual funds. The
Portfolios most likely will not have the same performance experience as any
publicly available mutual fund.
________________________________________________________________________________
The Metropolitan Fund, Calvert Fund and Fidelity VIP and VIPII Funds are each a
"series" type fund registered with the Securities and Exchange Commission as an
"open-end management investment company" under the Investment Company Act of
1940 (the "1940 Act"). A "series" fund means that each Portfolio is one of
several available through the fund. Except for the Janus Mid Cap, Calvert Social
Balanced and Calvert Mid Cap Portfolios, each Portfolio is "diversified" under
the 1940 Act.
The Metropolitan Fund, the Calvert Fund and Fidelity VIP and VIPII Funds and
each of their Portfolios are more fully described in their respective
prospectuses and SAIs. The Metropolitan Fund prospectus is attached at the end
of this Prospectus. If any of the Calvert Fund or Fidelity VIP and VIPII Funds'
Portfolios are available to you, then you will also receive their prospectuses
as appropriate. The SAI for each fund is available upon your request.
The Portfolios of the Metropolitan Fund pay us a monthly fee for our services as
investment manager. The Portfolios of the Calvert Fund pay Calvert Asset
Management Company, Inc. a monthly fee as its investment manager. Similarly, the
Portfolios of the Fidelity VIP and VIPII Funds pay Fidelity Management &
Research Company a monthly fee as its investment manager. These fees, as well as
the operating expenses paid by each Portfolio, are described, as applicable, in
the Metropolitan Fund, the Calvert Fund and Fidelity VIP and VIPII Funds
prospectuses and SAIs.
FFA-31
<PAGE>
In addition, the Metropolitan Fund prospectus discusses other separate accounts
of MetLife and Metropolitan Tower Life Insurance Company that invest in the
Metropolitan Fund. The Calvert Fund and the Fidelity VIP and VIPII Funds
prospectuses each discuss different separate accounts of the various insurance
companies that invest in each fund's portfolios. The risks of these arrangements
are also discussed in each fund's prospectus.
Deferred Annuities
This Prospectus describes many kinds of Deferred Annuities under which you can
accumulate money:
Financial Freedom Account:
o TSA (Tax Sheltered Annuity)
o 403(a) (Qualified annuity plans under Section 403(a))
o Non-Qualified (for certain deferred arrangements and plans)
Enhanced Preference Plus Account:
o TSA (Tax Sheltered Annuity)
o 403(a) (Qualified annuity plans under Section 403(a))
o PEDC (Public Employee Deferred Compensation)
o Traditional IRA (Individual Retirement Annuities)
o Non-Qualified
o Non-Qualified (for certain deferred arrangements and plans)
________________________________________________________________________________
These Deferred Annuities are issued to a group. You are then a participant under
the group's Deferred Annuity.
________________________________________________________________________________
These Non-Qualified Deferred Annuities (for certain deferred arrangements and
plans) include Section 457(f) deferred compensation plans, Section 451 deferred
fee arrangements, Section 451 deferred compensation plans, Section 457(e)(11)
severance and death benefits plans, and for Financial Freedom Deferred Annuities
only, Section 415(m) qualified governmental excess benefit arrangements. The
Non-Qualified Deferred Annuities for Section 457(e)(11) severance and death
benefit plans have special tax risks. We no longer offer Section 457(e)(11)
severance and death benefit plans but will accept purchase payments for those
already issued.
FFA-32
<PAGE>
Certain group Deferred Annuities may be issued to a bank that does nothing but
hold them as contractholder. Deferred Annuities may be either:
o Allocated (your Account Balance records are kept for you as an individual); or
o Unallocated (Account Balance records are kept for a plan or group as a whole).
The Deferred Annuity and Your Retirement Plan
________________________________________________________________________________
We created these investment strategies to help you manage your money. You decide
if one is appropriate for you, based upon your risk tolerance and saving goals.
These strategies were designed to help you take advantage of the tax-deferred
status of an annuity.
________________________________________________________________________________
If you participate through a retirement plan, the Deferred Annuity may provide
that all or some of your rights as described in this Prospectus are subject to
the plan's terms. Limitations on your rights may apply to investment choices,
purchase payments, withdrawals, transfers, the death benefit and pay-out
options.
The Deferred Annuity may provide that a plan administrative fee will be paid by
making a withdrawal from your Account Balance. Also, the Deferred Annuity may
require that you or your beneficiary obtain a signed authorization from your
employer or plan administrator to exercise certain rights. We may rely on your
employer's or plan administrator's statements to us as to the terms of the plan
or your entitlement to any amounts. We will not be responsible for determining
what your plan says. You should consult the Deferred Annuity contract and plan
document to see how you may be affected. If you are a Texas Operational
Retirement Program participant, please see Appendix IIfor specific information
which applies to you.
Automated Investment Strategies
There are five automated investment strategies available to you for Enhanced
Deferred Annuities. The Equity Generator is the only investment strategy
available for Financial Freedom Deferred Annuities. As with any investment
program, no strategy can guarantee a gain - you can lose money. We may modify or
terminate any of the strategies at any time. You may have only one automated
investment strategy in effect at a time.
The Equity Generator(Service Mark): An amount equal to the interest earned in
the Fixed Interest Account is transferred monthly to either the MetLife Stock
Index or State Street Research Aggressive Growth investment division, based on
your selection.
If you elect the Equity Generator at the time you purchase your Deferred Annuity
and you never request allocation changes or transfers, when you withdraw money,
the early withdrawal charge will not exceed any earnings under the Deferred
Annuity.
The Equalizer(Service Mark): Each quarter amounts are transferred between the
Fixed Interest Account and, based on your selection, either the MetLife Stock
Index or State Street Research Aggressive Growth investment division to make the
values of each equal.
FFA-33
<PAGE>
The Rebalancer(Service Mark): You select a specific asset allocation from among
the investment divisions and the Fixed Interest Account. Each quarter, we
transfer amounts among these options to bring the percentage of your Account
Balance in each option back to your original allocation.
The Index Selector(Service Mark): You may select one of five asset allocation
models which are designed to correlate to various risk tolerance levels. Based
on the model you choose, your entire Account Balance is divided among, the
Lehman Brothers Aggregate Bond Index, MetLife Stock Index, Morgan Stanley
EAFE(Registered) Index and Russell 2000 Index investment divisions and the Fixed
Interest Account. Each quarter, the percentage in each of these investment
divisions and the Fixed Interest Account is brought back to the original
percentage by transferring amounts among the investment divisions and the Fixed
Interest Account.
In the future, we may permit you to allocate less than 100% of your Account
Balance to this strategy. This strategy may experience more volatility than our
other strategies. The models are subject to change from time to time. We provide
the elements to formulate the models. We may rely on a third party for its
expertise in creating appropriate allocations.
The Allocator(Service Mark): Each month a dollar amount you choose is
transferred from the Fixed Interest Account to any of the investment divisions
you choose. You select the day of the month and the number of months over which
the transfers will occur. A minimum transfer of $50 is the only requirement.
The Equity Generator and the Allocator are dollar cost averaging strategies.
Dollar cost averaging involves investing at regular intervals of time. Since
this involves continuously investing regardless of fluctuating prices, you
should consider whether you can continue the strategy through periods of
fluctuating prices.
________________________________________________________________________________
You may make purchase payments to your Deferred Annuity whenever you choose, up
to the date you begin receiving payments from a pay-out option. However, Federal
tax rules may limit the amount and frequency of your purchase payments.
________________________________________________________________________________
Purchase Payments
There is no minimum purchase payment. For Non-Qualified Deferred Annuities for
certain deferred arrangements or plans (except those for Section 415(m)
arrangements), we may require that each purchase payment be at least $2,000. In
addition, we may require that your total purchase payments must be at least
$15,000 for the first Contract Year and at least $5,000 each subsequent Contract
Year. Unless limited by tax law, you may continue to make purchase payments
under Enhanced Deferred Annuities while you receive Systematic Withdrawal
Program payments, as described later in this Prospectus, unless your purchase
payments are made through automatic payroll deduction, salary reduction or
salary deduction.
Allocation of Purchase Payments
You decide how your money is allocated among the Fixed Interest Account and the
investment divisions. You can change your allocations for additional purchase
payments. We will make allocation changes when we receive your request for a
change. You may also specify an effective date for the change as long as it is
within 30 days after we receive the request.
FFA-34
<PAGE>
Limits on Purchase Payments
Your ability to make purchase payments may be limited by:
o Federal tax laws.
o Our right to limit the total of your purchase payments to $500,000. We may
change the maximum by telling you in writing at least 90 days in advance.
o Regulatory requirements. For example, if you reside in Washington or Oregon,
we may be required to limit your ability to make purchase payments after you
have held the Deferred Annuity for more than three years, if the Deferred
Annuity was issued to you after you were age 60, or after you turn age 63, if
the Deferred Annuity was issued before you were age 61.
o A withdrawal based on your leaving your job.
o Receiving systematic termination payments (described later) from both the
Separate Account and Fixed Interest Account.
The Value of Your Investment
Accumulation Units are credited to you when you make purchase payments or
transfers into an investment division. When you withdraw or transfer money from
an investment division, accumulation units are liquidated. We determine the
number of accumulation units you have by dividing the amount of your purchase
payment, transfer or withdrawal by the Accumulation Unit Value on the date of
the transaction.
This is how we calculate the Accumulation Unit Value for each investment
division:
o First, we determine the change in investment performance (including any
investment-related charge) for the underlying Portfolio from the previous
trading day to the current trading day;
o Next, we subtract the daily equivalent of our insurance-related charge
(general administrative expense and mortality and expense risk charges) for
each day since the last Accumulation Unit Value was calculated; and
o Finally, we multiply the previous Accumulation Unit Value by this result.
FFA-35
<PAGE>
Examples
Calculating the Number of Accumulation Units
Assume you make a purchase payment of $500 into one investment division and that
investment division's Accumulation Unit Value is currently $10.00. You would be
credited with 50 accumulation units.
$500/10 = 50 accumulation units
Calculating the Accumulation Unit Value
Assume yesterday's Accumulation Unit Value was $10.00 and the number we
calculate for today's investment experience (minus charges) for an underlying
portfolio is 1.05. Today's Accumulation Unit Value is $10.50. The value of your
$500 investment is then $525.
$10.00 x 1.05 = $10.50 the new Accumulation Unit Value
However, assume that today's investment experience (minus charges) is .95
instead of 1.05. Today's Accumulation Unit Value is $9.50. The value of your
$500 investment is then $475.
$10.00 x .95 = $9.50 the new Accumulation Unit Value
Transfers
You can make an unlimited number of transfers between investment divisions or
between the investment divisions and the Fixed Interest Account. Some
restrictions may apply to transfers from the Fixed Interest Account to the
investment divisions. For us to process a transfer, you must tell us:
o The percentage or dollar amount of the transfer;
o The investment division (or Fixed Interest Account) from which you want the
money to be transferred;
o The investment division (or Fixed Interest Account) to which you want the
money to be transferred; and
o Whether you intend to start, stop or modify an automated investment strategy
by making the transfer.
We may require you to:
o Use our forms;
o Maintain a minimum Account Balance (if the transfer is in connection with an
automated investment strategy or if there is an outstanding loan from the
Fixed Interest Account); or
o Transfer a minimum amount if the transfer is in connection with the Allocator.
________________________________________________________________________________
You may transfer money within your contract as often as you like without
incurring current taxes on your earnings.
________________________________________________________________________________
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Access To Your Money
You may withdraw either all or a part of your Account Balance from the Deferred
Annuity. Withdrawals must be at least $500 (or the Account Balance, if less). To
process your request, we need the following information:
________________________________________________________________________________
Income taxes, tax penalties and early withdrawal charges may apply to any
withdrawal you make. Tax law generally prohibits withdrawals from TSA Enhanced
Deferred Annuities before you reach age 59 1/2.
________________________________________________________________________________
o The percentage or dollar amount of the withdrawal; and
o The investment division (or Fixed Interest Account) from which you want the
money to be withdrawn.
If you request, generally you can tell us to make payments directly to other
investments on a tax-free basis. You may only do so if all applicable tax and
state regulatory requirements are met and we receive all information necessary
for us to make the payment. We may require you to use our forms.
Systematic Withdrawal Program for Enhanced TSA and IRA Deferred Annuities
Under this program, available only for Enhanced TSA and IRA Deferred Annuities
and subject to approval in your state, you may choose to automatically withdraw
a specific dollar amount or a percentage of your Account Balance each Contract
Year. This amount is then paid in equal portions throughout the Contract Year
according to the time frame you select, e.g., monthly, quarterly, semi-annually
or annually. Once the Systematic Withdrawal Program is initiated the payments
will automatically renew each Contract Year.
If you elect to withdraw a dollar amount we will pay you the dollar amount each
Contract Year. If you elect to withdraw a percentage of your Account Balance,
each Contract Year we recalculate the dollar amount you will receive based on
your new Account Balance.
Calculating Your Payment Based on a Percentage Election for the First Contract
Year You Elect the Systematic Withdrawal Program: If you choose to receive a
percentage of your Account Balance, we will determine the dollar amount payable
on the date these payments begin. When you first elect the program, we will pay
this dollar amount over the remainder of the Contract Year. For example, if you
select to receive payments on a monthly basis, the percentage of your Account
Balance you request equals $12,000, and there are six months left in the
Contract Year, we will pay you $2,000 a month.
_______________________________________________________________________________
We will withdraw the payments from the Fixed Interest Account or investment
divisions you select, either pro rata or in the proportions you request. Each
payment must be at least $50. For the TSA Enhanced Deferred Annuity, if you
elect to receive payments through this program, you must either be 59 1/2 years
old or have left your job and you must have no loan outstanding from the Fixed
Interest Account.
________________________________________________________________________________
Calculating Your Payment for Subsequent Contract Years of the Systematic
Withdrawal Program: For each subsequent year that your Systematic Withdrawal
Program remains in effect, we will deduct from your Deferred Annuity and pay you
over the Contract Year either the dollar amount that you chose or a dollar
amount equal to the percentage of your Account Balance you chose. For example,
if you select to receive payments on a monthly basis, ask for a percentage and
that percentage equals $12,000 at the start of a Contract Year, we will pay you
$1,000 a month.
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If you do not provide us with your desired allocation, or there are insufficient
amounts in the investment divisions or the Fixed Interest Account that you
selected, the payments will be taken out pro rata from the Fixed Interest
Account and any investment divisions in which you then have money.
Selecting a Payment Date: Your payment date is the date we make the withdrawal.
When you select or change a payment date, we must receive your request at least
10 days prior to the selected payment date. If we do not receive your request in
time, we will make the payment a month after the date you selected. If you do
not select a payment date, we will automatically begin systematic withdrawals
within 30 days after we receive your request. Changes in the dollar amount,
percentage, or timing of payments can be made at the beginning of any Contract
Year and once a year. However, we must receive your request at least 30 days in
advance. If you make any of these changes we will treat your request as though
you were starting a new Systematic Withdrawal Program.
________________________________________________________________________________
If you would like to receive your systematic withdrawal payment by the first of
the month, you should request that the payment date be the 20th of the prior
month.
________________________________________________________________________________
Although we need your written authorization to begin this program, you may
cancel this program at any time by telephone or by writing to us at your MetLife
Designated Office.
________________________________________________________________________________
Your Account Balance will be reduced by the amount of your systematic withdrawal
payments and applicable withdrawal charges. Payments under this program are not
the same as income payments you would receive from a Deferred Annuity pay-out
option or under an Income Annuity.
________________________________________________________________________________
Systematic Withdrawal Program payments may be subject to an early withdrawal
charge unless an exception to this charge applies. For purposes of determining
how much of the annual payment amount is exempt from this charge under the free
withdrawal provision (discussed later), all Systematic Withdrawal Program
payments in a Contract Year are characterized as a single lump sum withdrawal as
of your first payment date in that Contract Year. When you first elect the
program, we will calculate the percentage of your Account Balance your
Systematic Withdrawal Program payment represents based on your Account Balance
on the first Systematic Withdrawal Program payment date. For all subsequent
Contract Years, we will calculate the percentage of your Account Balance your
Sytematic Withdrawal Program payment represents based on your Account Balance on
the first Systematic Withdrawal Program payment date of that Contract Year. We
will determine separately the early withdrawal charge and any relevant factors
(such as applicable exceptions) for each Systematic Withdrawal Program payment
as of the date it is withdrawn from your Deferred Annuity.
Minimum Distribution
In order for you to comply with certain tax law provisions, you may be required
to take money out of your Deferred Annuity (i.e., the later of when you reach
70 1/2 or retire). Rather than receiving your minimum distribution in one annual
lump-sum payment, you may request that we pay it to you in installments
throughout the calendar year. However, we may require that you maintain a
certain Account Balance at the time you request these payments.
FFA-38
<PAGE>
Contract Fee
There is no Separate Account annual contract fee. You may pay a $20 annual fee
from the Fixed Interest Account at the end of each Contract Year.
Charges
There are two types of charges you pay while you have money in an investment
division:
________________________________________________________________________________
The charges you pay will not reduce the number of accumulation units credited to
you. Instead, we deduct the charges each time we calculate the Accumulation Unit
Value.
________________________________________________________________________________
o Insurance-related charge, and
o Investment-related charge.
Insurance-Related Charge
You will pay an insurance-related charge for the Separate Account that is no
more than .95% annually of the average value of the amount you have in the
Separate Account. This charge pays us for general administrative expenses and
for the mortality and expense risk of the Deferred Annuity.
General administrative expenses we incur include financial, actuarial,
accounting, and legal expenses.
________________________________________________________________________________
MetLife guarantees that the Separate Account insurance-related charge will not
increase while you have a Deferred Annuity.
________________________________________________________________________________
The mortality portion of the insurance-related charge pays us for the risk that
you may live longer than we estimated. Then, we could be obligated to pay you
more in payments from a pay-out option than we anticipated. Also, we bear the
risk that the guaranteed death benefit we would pay should you die during your
"pay-in" phase is larger than your Account Balance. We also bear the risk that
our expenses in administering the Deferred Annuities may be greater than we
estimated (expense risk).
Investment-Related Charge
This charge pays the investment managers of the Metropolitan Fund, Calvert Fund
and Fidelity VIP and VIPII Funds for managing money in the Portfolios and
investment operating expenses. We manage the Metropolitan Fund. The percentage
you pay depends on which investment divisions you select. Amounts for each
investment division are listed in the Table of Expenses.
Annuity Taxes
Some jurisdictions tax what are called "annuity considerations." These may apply
to purchase payments, Account Balances and death benefits. In most
jurisdictions, we currently do not deduct any money from purchase payments,
Account Balances or death benefits to pay these taxes. Generally, our practice
is to deduct money to pay annuity taxes (also known as "premium taxes") only
when you exercise a pay-out option. In certain states, we may also deduct money
to pay annuity taxes on lump sum withdrawals or when you exercise a pay-out
option. We may deduct an amount to pay
FFA-39
<PAGE>
annuity taxes some time in the future since the laws and the interpretation of
the laws relating to annuities are subject to change.
A chart in the Appendix shows the states where annuity taxes are charged and
the amount of these taxes.
Early Withdrawal Charges for TSA, 403(a), Non-Qualified, PEDC and IRA Enhanced
Deferred Annuities
________________________________________________________________________________
We do not include your earnings when calculating early withdrawal charges.
However, if the early withdrawal charge is greater than the rest of your
purchase payments, then we will take the early withdrawal charges, in whole or
in part, from your earnings.
You will not pay an early withdrawal charge on any purchase payments made more
than 7 years ago.
For Financial Freedom and certain Non-Qualified Enhanced Deferred Annuities,
early withdrawal charges do not apply to the Separate Account. However, these
charges may apply to withdrawals from the Fixed Interest Account and to
transfers from the Fixed Interest Account into the investment divisions.
________________________________________________________________________________
An early withdrawal charge of up to 7% may apply if you withdraw purchase
payments within 7 years of when they were credited to your Deferred Annuity. To
determine the early withdrawal charge for the TSA, 403(a), Non-Qualified, PEDC
and IRA Enhanced Deferred Annuities, we treat your Fixed Interest Account and
Separate Account as if they were a single account and ignore both your actual
allocations and from the Fixed Interest Account or investment division from
which the withdrawal is actually coming. To do this, we first assume that your
withdrawal is from amounts (other than earnings) that can be withdrawn without
an early withdrawal charge, then from other amounts (other than earnings) and
then from earnings, each on a "first-in-first-out" (oldest money first) basis.
Once we have determined the amount of the early withdrawal charge, we will
actually withdraw it from the Fixed Interest Account and the investment
divisions in the same proportion as the withdrawal is being made. In determining
what the withdrawal charge is, we do not include earnings, although the actual
withdrawal to pay it may come from earnings.
For partial withdrawals, the early withdrawal charge is determined by dividing
the amount that is subject to the early withdrawal charge by 100% minus the
applicable percentage shown in the following chart. Then we will make the
payment directed, and withdraw the early withdrawal charge.
For a full withdrawal we multiply the amount to which the withdrawal charge
applies by the percentage shown; keep the result as an early withdrawal charge
and pay you the rest. We will treat your request as a request for a full
withdrawal if your Account Balance is not sufficient to pay both the requested
withdrawal and the early withdrawal charge.
You pay no early withdrawal charges on withdrawals from Financial Freedom
Deferred Annuities and Non-Qualified Enhanced Deferred Annuities (for certain
deferred arrangements and plans).
The early withdrawal charge on purchase payments withdrawn is as follows:
FFA-40
<PAGE>
<TABLE>
<CAPTION>
During Purchase Payment Year
Year 1 2 3 4 5 6 7 8 & Later
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Percentage 7% 6% 5% 4% 3% 2% 1% 0
</TABLE>
By law, your total early withdrawal charges applied to amounts in the investment
divisions will never exceed 9% of all your purchase payments in the investment
divisions.
The early withdrawal charge reimburses us for our costs in selling the Deferred
Annuities. We may use our profits (if any) from the mortality and expense risk
charge to pay for our costs to sell the Deferred Annuities which exceed the
amount of early withdrawal charges we collect. However, we believe that our
sales costs may exceed the early withdrawal charges we collect. If so, we will
pay the difference out of our general profits.
Because the reduced sales costs for certain Enhanced Deferred Annuities, there
are no early withdrawal charges.
When No Early Withdrawal Charge Applies for TSA, 403(a), Non-Qualified, PEDC and
IRA Enhanced Deferred Annuities
In some cases, we will not charge you the early withdrawal charge when you make
a withdrawal. We may, however, ask you to prove that you meet one of the
following conditions listed below.
You do not pay an early withdrawal charge:
o On transfers you make within your Deferred Annuity.
o On withdrawals of purchase payments you made over seven years ago.
o If you choose payments over one or more lifetimes or for a period of at least
five years (without the right to accelerate the payments).
o If you die during the pay-in phase. Your beneficiary will receive the full
death benefit without deduction.
________________________________________________________________________________
Early withdrawal charges never apply to transfers among investment divisions or
transfers to the Fixed Interest Account.
________________________________________________________________________________
o If you withdraw up to 20% (10% for certain TSA Enhanced Deferred Annuities) of
your Account Balance each Contract Year. This 20% (or 10%) total withdrawal
may be taken in an unlimited number of partial withdrawals during that
Contract Year. Each time you make a withdrawal, we calculate what percentage
your withdrawal represents at that time. Only when the total of these
percentages exceeds 20% (or 10%) will you have to pay early withdrawal
charges.
o If the withdrawal is required for you to avoid Federal income tax penalties or
to satisfy Federal income tax rules or Department of Labor regulations that
apply to your Deferred Annuity.
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<PAGE>
o Systematic Termination. For all Deferred Annuities except certain TSA,
Non-Qualified and IRA Enhanced Deferred Annuities, if the contract is
terminated, the Account Balance may be systematically withdrawn in annual
installments without early withdrawal charges. You may ask to receive your
money in annual installments based on the following percentages of your
Account Balance for that year's withdrawal:
<TABLE>
<CAPTION>
Contract Year
1* 2 3 4 5
<S> <C> <C> <C> <C>
20% 25% 33 1/3% 50% remainder
</TABLE>
* Less that Contract Year's withdrawals.
Any money you withdraw in excess of these percentages in any Contract Year
will be subject to early withdrawal charges. You may stop the systematic
termination of the contract. If you ask to restart systematic termination,
you begin at the beginning of the schedule listed above.
o If you are disabled and you request a total withdrawal. Disability is as
defined in the Federal Social Security Act.
o If you retire:
o For the Non-Qualified and certain PEDC Enhanced Deferred Annuities, if
you retire.
o For certain TSA Enhanced Deferred Annuities, if you have also
participated for at least 10 consecutive years. This does not apply for
withdrawals of money transferred into the contract from other investment
vehicles on a tax-free basis (plus earnings on such amounts).
o For certain TSA, PEDC and 403(a) Enhanced Deferred Annuities, if you also
have participated for at least 10 consecutive years unless you retire
according to the definition of retirement stated in your plan.
o If you leave your job with the employer that bought the Deferred Annuity.
(Except for certain TSA, Non-Qualified and IRA Enhanced Deferred Annuities.)
o If your plan terminates and the withdrawal is transferred into another annuity
contract we issue. (Except for certain TSA, Non-Qualified and IRA Enhanced
Deferred Annuities.)
o If your plan provides payment on account of hardship and you suffer from an
unforeseen hardship. (Except for certain TSA, 403(a), Non-Qualified and IRA
Enhanced Deferred Annuities.) For certain TSA Enhanced Deferred Annuities, you
must only have suffered an unforeseen hardship.
FFA-42
<PAGE>
o If you make a direct transfer to other investment vehicles we have
preapproved. (Except for certain TSA, Non-Qualified and IRA Enhanced Deferred
Annuities.)
o If you withdraw money under a plan provision which we have preapproved.
(Except for certain TSA, Non-Qualified, PEDC, and IRA Enhanced Deferred
Annuities.)
When Another Early Withdrawal Charge May Apply
If you transferred money from certain eligible MetLife contracts into a Deferred
Annuity. You may have different early withdrawal charges for these transfer
amounts. Any purchase payments made after the transfer are subject to the usual
early withdrawal charge schedule.
o Amounts transferred before January 1, 1996:
o We credit your transferred amounts with the time you held them under your
original contract or if it will produce a lower charge;
o We use the following schedule to determine early withdrawal charges for
transferred amounts from your original contract.
<TABLE>
<CAPTION>
During Purchase Payment Year
Year 1 2 3 4 5 6 and Beyond
<S> <C> <C> <C> <C> <C> <C>
Percentage 5% 4% 3% 2% 1% 0%
</TABLE>
o Amounts transferred on or after January 1, 1996:
o For certain contracts which we issued at least two years before the date
of the transfer, we apply the withdrawal charge under your original
contract but not any of the original contract's exceptions or reductions
to the withdrawal charge percentage that do not apply to a Deferred
Annuity, or if it will produce a lower charge.
We use the following schedule to determine early withdrawal charges for
transferred amounts from your original contract:
<TABLE>
<CAPTION>
After the Transfer
Year 1 2 3 4 5 6 and Beyond
<S> <C> <C> <C> <C> <C> <C>
Percentage 5% 4% 3% 2% 1% 0%
</TABLE>
o If we issued the other contract less than two years before the date of
the transfer or it has a separate withdrawal charge for each purchase
FFA-43
<PAGE>
payment, we treat your purchase payments under the other contract as if
they were made under the Deferred Annuity as of the date we received them
under that contract.
o Alternatively, if provided for in your Deferred Annuity, we credit your
purchase payments with the time you held them under your original contract.
Free Look
You may cancel the Deferred Annuity within a certain time period. This is known
as a "free look." We must receive your request to cancel in writing. The number
of days for this "free look" varies from state to state. The time period may
also vary depending on your age and whether you purchased the Deferred Annuity
from us directly, through the mail or with money from another annuity or life
insurance policy. Again, depending on state law, we may refund all of your
purchase payments or your Account Balance as of the date your refund request is
received at your MetLife Designated Office.
Death Benefit
One of the insurance guarantees we provide you under the Deferred Annuity is
that your beneficiaries will be protected against market downturns. You name
your beneficiary(ies) under the following Deferred Annuities:
o Enhanced TSA
o Enhanced Non-Qualified
o Enhanced 403(a)
o Enhanced Traditional IRA
o Financial Freedom TSA
o Financial Freedom 403(a)
For the following Deferred Annuities the trustee receives the death benefit:
o Non-Qualified Deferred Annuity for
o Section 457(f) deferred compensation plan
o Section 451 deferred fee arrangements
o Section 451 deferred compensation plans
o Section 457(e)(11) severance and death benefit plans
o Section 415(m) qualified governmental excess benefit arrangements
o For PEDC Deferred Annuities, the employer or trustee receives the death
benefit.
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The death benefit your beneficiary receives will be the greatest of:
o Your Account Balance;
o Your highest Account Balance as of the end of any fifth calendar year in which
you have the Deferred Annuity and as of the end of each later five year
period. In any case, less any later partial withdrawals, fees and charges; or
o The total of all of your purchase payments less any partial withdrawals.
In each case, we deduct the amount of any outstanding loans from the death
benefit.
We will only pay the death benefit when we receive both proof of your death and
appropriate instructions for payment.
Your beneficiary has the option to apply the death benefit (less any applicable
annuity taxes) to a pay-out option offered under your Deferred Annuity. Your
beneficiary may, however, decide to take a lump sum cash payment.
Pay-out Options (or Income Options)
You may receive a regular stream of money after your "pay-in" or "accumulation"
phase. When you are selecting your pay-out option you will be able to choose
from the range of options we then have available. If you decide you want a
pay-out option, we withdraw some or all of your Account Balance (less any
annuity taxes, applicable contract fees and outstanding loans). Then, we apply
the remainder to the option. Generally, you may defer receiving payments for up
to one year after you have chosen your pay-out option.
________________________________________________________________________________
The pay-out phase is often referred to as either "annuitizing" your contract or
taking an income annuity.
________________________________________________________________________________
When considering whether to select a pay-out option, you should think about
whether:
o You want payments guaranteed by us for the rest of your life (or for the rest
of two lives) or for a specified period;
o You want a fixed dollar payment or a variable payment;
o You want a refund feature.
Your income payment amount will depend upon the option you choose. For lifetime
options, the age and sex of the measuring lives (annuitants) will also be
considered.
________________________________________________________________________________
Should our current immediate annuity rates for a fixed pay-out option provide
for greater payments than those quoted in your contract, we will use the current
rates.
________________________________________________________________________________
By the date specified in your contract, if you do not either select a pay-out
option or withdraw your entire Account Balance, and your Deferred Annuity was
not issued under a retirement plan, we will automatically issue you a life
annuity with a 10 year guarantee. In that case, if you do not tell us otherwise,
your Fixed Interest Account Balance will be used to provide a Fixed Income
Option and your Separate Account Balance will be used to provide a variable
income option. However, if we do ask you what you want us to do and you do not
respond, we may treat your silence as a request by you to continue your Deferred
Annuity.
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Because many of the features of variable pay-out options under the Deferred
Annuities are identical to the features of Income Annuities, we are providing
more information about variable pay-out options under the "Income Annuities"
heading.
Income Annuities
Income Annuities provide you with a regular stream of payments for either your
lifetime or a specific period. Income Annuities can be purchased so that you
begin receiving payments immediately or you can apply the Account Balance of the
Deferred Annuity to a pay-out option to receive payments during your "pay-out"
phase. With an Income Annuity, you must start receiving payments within the
first year after the annuity is issued.
We do not guarantee that your variable payments will be a specific amount of
money. You may choose to have a portion of the payment fixed and guaranteed
under the Fixed Income Option.
Using proceeds from the following types of arrangements, you may purchase the
following types of Income Annuities to receive immediate payments:
________________________________________________________________________________
You may choose the frequency of your income payments. For example, you may
receive your payments on a monthly, quarterly, semi-annual or annual basis.
________________________________________________________________________________
Financial Freedom Account:
o TSA
o 403(a)
o Non-Qualified (for certain deferred arrangements and plans)
Enhanced Preference Plus Account:
o TSA
o 403(a)
o PEDC
o Traditional IRA
o Non-Qualified
o Non-Qualified (for certain deferred arrangements and plans)
If you have accumulated amounts in any of the listed investment vehicles, your
lump sum withdrawal from that investment vehicle may be used to purchase an
appropriate Income Annuity as long as income tax requirements are met.
These Non-Qualified Deferred Annuities (for certain deferred arrangements and
plans) include Section 457(f) deferred compensation plans, Section 451 deferred
fee arrangements, Section 451 deferred compensation plans, Section 457(e)(11)
severance and death benefits plans, and Section 415(m) qualified governmental
excess benefit arrangements. The Deferred Annuities for Section 457(e)(11)
severance and death benefit plans have special tax risks. We no longer offer the
Non-Qualified Deferred Annuities for Section 457(e)(11) severance and death
benefit plans but will accept purchase payments for those already issued.
If your retirement plan has purchased an Income Annuity, then your choice of
pay-out options may be subject to the terms of the plan. We may rely on your
employer's or plan administrator's statements to us as to the terms of the plan
or your entitlement to any payments. We will not be responsible for interpreting
the terms of your plan. You should review your plan document to see how you may
be affected.
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<PAGE>
Income Payment Types
Currently, we provide you with a wide variety of income payment types to suit a
range of personal preferences.
There are three people who are involved in payments under your Income Annuity:
o Owner: the person or entity which has all rights under the Income Annuity
including the right to direct who receives payment.
________________________________________________________________________________
Many times the Owner and the Annuitant are the same person.
________________________________________________________________________________
o Annuitant: the person whose life is the measure for determining the timing and
sometimes the dollar amount of payments.
o Beneficiary: the person who may receive continuing payments or a lump sum
payment if the owner dies.
The following income payment types are available:
Your Lifetime Annuity: A variable income payable during the annuitant's life.
Your Lifetime with a Guaranteed Period Annuity: A variable income payable during
the annuitant's life with a guaranteed number of years. If, at the death of the
annuitant, payments have been made for less than the guaranteed period, payments
are made to the owner of the annuity (or the beneficiary if the owner dies
before the end of the guaranteed period) for the rest of the guaranteed period.
________________________________________________________________________________
When deciding how to receive income, consider:
o The amount of income you need;
o The amount you expect to receive from other sources;
o The growth potential of other investments; and
o How long you would like your income to last.
________________________________________________________________________________
Your Lifetime With a Refund Annuity: A variable income payable during the
annuitant's life with a refund provision. If, at the death of the annuitant, the
total of all income payments is less than the purchase payment that we received,
we will pay to the owner of the annuity (or to the beneficiary if the owner is
not alive) an amount equal to the difference.
Income for Two Lives Annuity: A variable income payable while either of two
annuitants is alive. After one annuitant dies, payments continue if the other
annuitant is alive. Payments stop once both annuitants are no longer alive.
Payments after one annuitant dies may be the same as those paid while both were
alive or may be a lower percentage that is selected when the annuity is
purchased (e.g. 75%, 66 2/3% or 50%).
Income for Two Lives with a Guaranteed Period Annuity: This is the same as the
Income for Two Lives Annuity described above, but we guarantee to pay the full
amount (not a reduced percentage) for the guaranteed period even if one or both
annuitants die. If, upon the death of both annuitants, payments have been made
for less than the guaranteed period, payments are made to the owner of the
annuity (or the beneficiary if the owner dies before the end of the guaranteed
period) for the rest of the guaranteed period.
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<PAGE>
Income for Two Lives with a Refund Annuity: This is the same as the Income for
Two Lives Annuity described above but if, upon the death of both annuitants, the
total of all of income payments is less than the purchase payment that we
received, we will pay the owner of the annuity (or to the beneficiary if the
owner is not alive) an amount equal to the difference.
Income for a Guaranteed Period Annuity: A variable income payable for a
guaranteed period (5-30 years). Payments cease at the end of the guaranteed
period (which is often called a "term certain" period) even if the annuitant is
still alive. If the annuitant dies before the end of the guaranteed period,
payments are made to the owner of the annuity (or to the beneficiary if the
owner dies before the end of the guaranteed period) for the rest of the
guaranteed period.
Purchasing an Income Annuity
Your purchase payment must be large enough to produce an initial income payment
of at least $50. If you live in Massachusetts, the initial income payment must
be at least $20.
Allocation of Your Purchase Payment
You decide how your money is allocated among the Fixed Income Option and the
investment divisions.
The Value of Your Income Payments
Annuity units are credited to you when you make a purchase payment or transfer
into an investment division. When you transfer money from an investment
division, annuity units in that investment division are liquidated. Before we
determine the number of annuity units you have, we reduce your purchase payments
by any annuity taxes and the contract fee, if applicable. We then divide the
remainder by the Annuity Unit Value on the date of the transaction.
________________________________________________________________________________
The AIR is stated in your contract and may range from 3% to 6%.
________________________________________________________________________________
Your payment is determined by using the Assumed Investment Return ("AIR") to
benchmark the investment experience of the investment divisions you select. The
higher your AIR, the higher your first income payment will be. Your next
payments will only increase in proportion to the amount the investment
experience of your chosen investment divisions exceeds the AIR and Separate
Account charges. Likewise, your payments will decrease to the extent the
investment experience of your chosen investment divisions is less than the AIR
and Separate Account charges. A lower AIR will result in a lower initial
variable income payment, but subsequent variable income payments will increase
more rapidly or decline more slowly as changes occur in the investment
experience of the investment divisions.
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<PAGE>
Your income payments are determined on the later of either ten days prior to
your income payment date or your contract's issue date, if later.
This is how we calculate the Annuity Unit Value for each investment division:
o First, we determine the change in investment experience (including any
investment-related charge) for the underlying portfolio from the previous
trading day to the current trading day;
o Next, we subtract the daily equivalent of your insurance-related charge
(general administrative expenses and mortality and expense risk charges) for
each day since the last day the Annuity Unit Value was calculated;
o Then, we divide by the daily equivalent of your AIR; and
o Finally, we multiply the previous Annuity Unit Value by this result.
Transfers
You can make an unlimited number of transfers among investment divisions or from
the investment divisions to the Fixed Income Option. If you reside in certain
states you may be limited to four options (including the Fixed Interest Option).
For us to process a transfer, you must tell us:
o The percentage or dollar amount of the transfer;
o The investment division (or Fixed Income Option) to which you want to
transfer; and
________________________________________________________________________________
Once you transfer money into the Fixed Income Option you may not later transfer
it into an investment division.
________________________________________________________________________________
o The investment division from which you want to transfer.
We may require that you use our forms to make transfers.
Contract Fee
There is no contract fee under the Income Annuities.
Charges
There are two types of charges you pay if you allocate any of your purchase
payment to the investment divisions:
________________________________________________________________________________
The charges you pay will not reduce the number of annuity units credited to you.
Instead, we deduct the charges when calculating the Annuity Unit Value.
________________________________________________________________________________
o Insurance-related charge; and
o Investment-related charge.
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Insurance-Related Charge
You will pay an insurance-related charge for the Separate Account that is no
more than .95% annually of the average value of the amount you have in the
Separate Account. This charge pays us for general administrative expenses and
for mortality and expense risk of the Income Annuity.
General administrative expenses we incur include financial, actuarial,
accounting, and legal expenses.
The mortality portion of the insurance-related charge pays us for the risk that
you may live longer than we estimated. Then, we could be obligated to pay you
more in payments than we anticipated.
We also bear the risk that our expenses in administering the Income Annuities
will be greater than we estimated (expense risk).
Investment-Related Charge
This charge pays the investment managers of the Metropolitan Fund, Calvert Fund
and Fidelity VIP and VIPII Funds for managing money in the Portfolios and
investment operating expenses. We are the managers for the Metropolitan Fund.
The percentage you pay depends on the investment divisions you select. Amounts
for each investment division are listed in the Table of Expenses.
Annuity Taxes
Some jurisdictions tax what are called "annuity considerations." We deduct money
to pay "annuity" taxes (also known as "premium" taxes) when you make the
purchase payment. A chart that shows the states where annuity taxes are charged
and the amount of these taxes is in the Appendix.
Free Look
You may cancel your Income Annuity within a certain time period. This is known
as a "free look." We must receive your request to cancel in writing. The number
of days for this "free look" varies from state to state. The "free look" may
also vary depending on your age and whether you purchased your Income Annuity
from us directly, through the mail or with money from another annuity or life
insurance policy. Again, depending on state law, we may refund all of your
purchase payment or the value of your annuity units as of the date your refund
request is received at your MetLife Designated Office.
________________________________________________________________________________
You do not have a free look if you are electing income payments in the pay-out
phase of your Deferred Annuity.
________________________________________________________________________________
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General Information
Administration
All transactions will be processed in the manner described below.
Purchase Payments
________________________________________________________________________________
Generally, your requests including subsequent purchase payments are effective
the day we receive them at your MetLife Designated Office.
________________________________________________________________________________
Send your purchase payments by check or money order made payable to "MetLife" to
your MetLife Designated Office. We will provide you with all necessary forms. We
must have all completed documents to credit your purchase payments.
Usually, your initial purchase payment is credited to you within two days of
receipt at your MetLife Designated Office. However, if you fill out our forms
incorrectly or incompletely or other documentation is not completed properly, we
have up to five business days to credit the payment. If the problem cannot be
resolved by the fifth business day, we will notify you and give you the reasons
for the delay. At that time, you will be asked whether you agree to let us keep
your money until the problem is resolved. If you do not agree or we cannot reach
you by the fifth business day, your money will be returned.
Under certain group Deferred Annuities and group Income Annuities, your
employer, or the group in which you are a participant or member must identify
you on their reports to us and tell us how your money should be allocated among
the investment divisions and the Fixed Interest Account/Fixed Income Option.
Purchase payments (including any portion of your Account Balance under a
Deferred Annuity which you apply to a pay-out option) are effective and valued
as of 4:00 p.m. Eastern time, on the day we receive them in good order at your
MetLife Designated Office, except when they are received:
o On a day when the Accumulation Unit/Annuity Unit Value is not calculated, or
o After 4:00 p.m. Eastern time.
In those cases, the purchase payments will be effective the next day the
Accumulation Unit Value or Annuity Unit Value, as applicable, is calculated.
Confirming Transactions
You will receive a written statement confirming that a transaction was recently
completed. Certain transactions made on a periodic basis, such as Systematic
Withdrawal Program payments and automated investment strategy transfers, may be
confirmed quarterly. Salary reduction or deduction purchase payments under TSA
Deferred Annuities and the Non-Qualified Financial Freedom Deferred Annuity for
415(m) qualified governmental excess benefit arrangements are confirmed
quarterly.
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Transactions by Telephone
You may conduct a variety of transactions by telephone, unless prohibited by
state law.
Your telephone transaction must be completed by 4:00 p.m. Eastern time if you
want the transaction to take place on that day.
We have put into place reasonable security procedures to insure that
instructions communicated by telephone are genuine. For example, all telephone
calls are recorded. Also, you will be asked to provide some personalized data
prior to giving your instructions over the telephone. When someone contacts us
by telephone and follows our security procedures, we will assume that you are
authorizing us to act upon those telephone instructions. Neither we nor the
Separate Account will be liable for any loss, expense or cost arising out of any
requests that we or the Separate Account reasonably believe to be authentic. In
the unlikely event that you have trouble reaching us, requests should be made in
writing to your MetLife Designated Office.
________________________________________________________________________________
You may authorize your sales representative to make telephone transactions on
your behalf. You must complete the form and we must agree.
________________________________________________________________________________
Processing of Certain Transactions
If we are notified of your death before a requested transaction is completed, we
will cancel the request. For example, if you request a transfer or withdrawal
for a date in the future under a Deferred Annuity and then die before that date,
we simply pay the death benefit instead. For Income Annuity transfers, we will
cancel the request and continue making payments to your beneficiary if your
Income Annuity so provides. Or, depending on your Income Annuity's provisions we
may continue making payments to a joint annuitant or pay your beneficiary a
refund.
Valuation
We separately determine the Accumulation Unit Value and Annuity Unit Value for
each investment division once each day when the New York Stock Exchange is open
for trading. If permitted by law, we may change the period between calculations
but we will give you 30 days notice.
When you request a transaction, we will process the transaction using the next
available Accumulation Unit Value for Deferred Annuities or Annuity Unit Value
for Income Annuities. Subject to our procedure, we will make withdrawals under a
Deferred Annuity and transfers under a Deferred Annuity or Income Annuity at a
later date, if you request. If your withdrawal request is to elect a variable
pay-out option under your Deferred Annuity, we base the number of annuity units
you receive on the next available Annuity Unit Value.
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Advertising Performance
We periodically advertise the performance of the investment divisions. You may
get performance information from a variety of sources including your quarterly
statements, your MetLife representative. the internet, annual reports and
semi-annual reports. We may state performance in terms of "yield," "change in
Accumulation Unit Value/Annuity Unit Value," "average annual total return," or
some combination of these terms.
Yield is the net income generated by an investment in a particular investment
division for 30 days or a month. These figures are expressed as percentages.
This percentage yield is compounded semiannually.
________________________________________________________________________________
All performance numbers are based upon historical earnings. These numbers are
not intended to indicate future results.
________________________________________________________________________________
Change in Accumulation/Annuity Unit Value is calculated by determining the
percentage change in the value of an accumulation (or annuity) unit for a
certain period. These numbers may also be annualized. Change in
Accumulation/Annuity Unit Value may be used to demonstrate performance for a
hypothetical investment (such as $10,000) over a specified period. These
performance numbers reflect the deduction of the total Separate Account charges;
however, yield and change in Accumulation/Annuity Unit Value performance do not
reflect the possible imposition of early withdrawal charges. Early withdrawal
charges would reduce performance experience.
Average annual total return calculations reflect all Separate Account charges
and applicable early withdrawal charges. These figures also assume a steady
annual rate of return.
Performance figures will vary among the various Deferred Annuities and Income
Annuities as a result of different Separate Account charges and early withdrawal
charges. For purposes of presentation, we may assume that certain Deferred
Annuities and Income Annuities were in existence prior to their inception date.
In these cases, we calculate performance based on the historical performance of
the underlying Metropolitan Fund, Calvert Fund and Fidelity VIP and VIP II Funds
Portfolios. We use the actual accumulation unit or annuity unit data after the
inception date.
We calculate performance for certain investment strategies including the
Equalizer, Equity Generator and each asset allocation model of the Index
Selector. We calculate the performance as a percentage by presuming a certain
dollar value at the beginning of a period and comparing this dollar value with
the dollar value based on historical performance at the end of that period. This
percentage return assumes that there have been no withdrawals or other unrelated
transactions.
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Changes to Your Deferred Annuity or Income Annuity
We have the right to make certain changes to your Deferred Annuity or Income
Annuity, but only as permitted by law. We make changes when we think they would
best serve the interest of annuity owners or would be appropriate in carrying
out the purposes of the Deferred Annuity or Income Annuity. If the law requires,
we will also get your approval and the approval of any appropriate regulatory
authorities. Examples of the changes we may make include:
o To operate the Separate Account in any form permitted by law.
o To take any action necessary to comply with or obtain and continue any
exemptions under the law.
o To transfer any assets in an investment division to another investment
division, or to one or more separate accounts, or to our general account, or
to add, combine or remove investment divisions in the Separate Account.
o To substitute for the Portfolio shares in any investment division, the shares
of another class of the Metropolitan Fund or the shares of another investment
company or any other investment permitted by law.
o To change the way we assess charges, but without increasing the aggregate
amount charged to the Separate Account and any currently available portfolio
in connection with the Deferred Annuities or Income Annuities.
o To make any necessary technical changes in the Deferred Annuities or Income
Annuities in order to conform with any of the above-described actions.
If any changes result in a material change in the underlying investments of an
investment division in which you have a balance, we will notify you of the
change. You may then make a new choice of investment divisions. For Deferred
Annuities issued in Pennsylvania (and Income Annuities where required by law),
we will ask your approval before making any technical changes.
Voting Rights
Based on our current view of applicable law, you have voting interests under
your Deferred Annuity or Income Annuity concerning Metropolitan Fund, Calvert
Fund and Fidelity VIP and VIPII Funds proposals that are subject to a
shareholder vote. Therefore, you are entitled to give us instructions for the
number of shares which are deemed attributable to your Deferred Annuity or
Income Annuity.
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We will vote the shares of each of the underlying Portfolios held by the
Separate Account based on instructions we receive from those having a voting
interest in the corresponding investment divisions. However, if the law or the
interpretation of the law changes, we may decide to exercise the right to vote
the Portfolio's shares based on our own judgment.
You will be entitled to give instructions regarding the votes attributable to
your Deferred Annuity or Income Annuity in your sole discretion. Under Section
457(f) deferred compensation plans, Section 451 deferred fee arrangements,
Section 451 deferred compensation plans, Section 457(e)(11) severance and death
benefit plans and the TSA Deferred Annuity and Income Annuities under which the
employer retains all rights, we will provide you with the number of copies of
voting instructions soliciting materials that you request so that you may
furnish such materials to participants who may give you voting instructions.
Neither the Separate Account nor MetLife has any duty to inquire as to the
instructions received or your authority to give instructions; thus, as far as
the Separate Account, and any others having voting interests in respect of the
Separate Account are concerned, such instructions are valid and effective.
There are certain circumstances under which we may disregard voting
instructions. However, in this event, a summary of our action and the reasons
for such action will appear in the next semiannual report. If we do not receive
your voting instructions, we will vote your interest in the same proportion as
represented by the votes we receive from other investors. Shares of the
Metropolitan Fund that are owned by our general account or by any of our
unregistered separate accounts will be voted in the same proportion as the
aggregate of:
o The shares for which voting instructions are received, and
o The shares that are voted in proportion to such voting instructions.
However, if the law or the interpretation of the law changes, we may decide to
exercise the right to vote the Portfolio's shares based on our judgment.
Who Sells the Deferred Annuities and Income Annuities
All Deferred Annuities and Income Annuities, are sold through our licensed sales
representatives. We are registered with the Securities and Exchange Commission
as a broker-dealer under the Securities Exchange Act of 1934. We are also a
member of the National Association of Securities Dealers, Inc. Deferred
Annuities and Income Annuities are also sold through other registered
broker-dealers. They also may be sold through the mail.
FFA-55
<PAGE>
The licensed sales representatives and broker-dealers who sell the annuities may
be compensated for these sales by commissions that we pay. There is no front-end
sales load deducted from purchase payments to pay sales commissions. The
Separate Account does not pay sales commissions. The commissions we pay range
from 0% to 6%.
We also make payments to our licensed sales representatives based upon the total
Account Balances of the Deferred Annuities assigned to the sales representative.
Under this compensation program, we pay an amount up to .12% of the total
Account Balances of the Deferred Annuities, other registered variable annuity
contracts, certain mutual fund account balances and cash values of certain life
insurance policies. These asset based commissions compensate the sales
representative for servicing the Deferred Annuities. These payments are not made
for Income Annuities.
From time to time, MetLife may pay organizations or associations a fee,
reimburse them for certain expenses, lease office space from them, purchase
advertisements in their publications or enter into other such arrangements in
connection with their endorsing or sponsoring MetLife's variable annuity
contracts or services, for permitting MetLife to undertake certain marketing
efforts of the organizations' members in connection with sales of MetLIfe
variable annuities, or some combination thereof. Additionally, MetLife has
retained consultants who are paid a fee for their efforts in establishing and
maintaining relationships between MetLife and various organizations.
Financial Statements
The financial statements for the Separate Account and MetLife are in the SAI and
are available from MetLife upon request.
Your Spouse's Rights
If you received your contract through a qualified retirement plan and your plan
is subject to ERISA (the Employee Retirement Income Security Act of 1974) and
you are married, the income payments, withdrawal provisions, and methods of
payment of the death benefit under your Deferred Annuity or Income Annuity may
be subject to your spouse's rights.
If your benefit is worth $5,000 or less, your plan may provide for distribution
of your entire interest in a lump sum without your spouse's consent.
For details or advice on how the law applies to your circumstances, consult your
tax advisor or attorney.
FFA-56
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When We Can Cancel Your Deferred Annuity or Income Annuity
We may not cancel your Income Annuity.
We may cancel your Deferred Annuity only if we do not receive any purchase
payments from you for 36 consecutive months and your Account Balance is less
than $2,000. If we do so for a Deferred Annuity delivered in New York we will
return the full Account Balance. In all other cases, you will receive an amount
equal to what you would have received if you had requested a total withdrawal of
your Account Balance. Early withdrawal charges may apply.
We may cancel your Non-Qualified Deferred Annuity for Section 457(f) deferred
compensation plans, Section 451 deferred fee arrangements, Section 451 deferred
compensation plans and Section 457(e)(11) severance and death benefit plans if
we do not receive any purchase payments from you for 12 consecutive months and
your Account Balance is less than $15,000. Certain Deferred Annuities do not
contain these cancellation provisions.
At our option, we may cancel certain TSA and PEDC Deferred Annuities if we
determine that changes to your retirement plan would cause MetLife to pay more
interest than we anticipated or to make more frequent payments than we
anticipated in connection with the Fixed Interest Account. We may also cancel
these Deferred Annuities, as legally permitted, if your retirement plan
terminates or no longer qualifies as a tax sheltered arrangement. Also, the
employer and MetLife may each cancel the Deferred Annuity upon 90 days notice to
the other party.
Special Charges That Apply If Your Retirement Plan Terminates Its Deferred
Annuity or Takes Other Action
Under certain TSADeferred Annuities, amounts equal to some or all of the early
withdrawal charge imposed under a contract of another issuer in connection with
the transfer of money into a TSADeferred Annuity may be credited to your Account
Balance. If such amounts are credited to a TSA Deferred Annuity, special
termination charges may be imposed. These charges may also apply if the plan
introduces other funding vehicles provided by other carriers. Charges are not
imposed on plan participants; but rather are absorbed by the contractholder.
Therefore, under the contract, the participant will incur only the withdrawal
charges, if applicable, otherwise discussed in this Prospectus. The charges to
the plan are imposed on the amount initially transferred to MetLife for the
first seven years according to the schedule in the following table:
FFA-57
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During Contract Year
<TABLE>
<CAPTION>
8 &
Year 1 2 3 4 5 6 7 Beyond
---- --- --- --- --- --- --- --- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Percentage 5.6% 5.0% 4.5% 4.0% 3.0% 2.0% 1.0% 0%
</TABLE>
The charge to the plan, for partial withdrawals, is determined by multiplying
the amount of the withdrawal that is subject to the charge by the applicable
percentage shown above.
Income Taxes
The following information on taxes is a general discussion of the subject. It is
not intended as tax advice. The Internal Revenue Code (Code) is complex and
subject to change on a regular basis. You should consult your own tax advisor
about your own circumstances. You should read the general provisions and any
sections relating to your type of annuity to familiarize yourself with some of
the tax rules for your particular contract. For purposes of this section, we
address Deferred Annuities and Income Annuities together as annuities. In
addition, because the tax treatment of Income Annuities and the pay-out option
under Deferred Annuities is generally the same, they are discussed together as
income payments.
Deferred Annuities in General
This section applies to TSA, 403(a), Non-Qualified, Traditional IRA and PEDC. It
does not apply to Non-Qualified Deferred Annuities for Section 451, Section
457(f) or Section 457(e)(11) plans.
________________________________________________________________________________
Simply stated, earnings on Deferred Annuities are generally not subject to
income tax until they are withdrawn. This is known as tax deferral.
________________________________________________________________________________
Deferred annuities are a means of setting aside money for future needs-usually
retirement. Congress recognizes how important saving for retirement is and has
provided special rules in the Internal Revenue Code (Code).
Contributions to TSA, 403(a), and PEDC are generally on a "before-tax" basis.
This means that the purchase payments either reduce your income, entitle you to
a tax deduction or are not subject to current income tax. Under some
circumstances "after-tax" contributions can be made to certain annuities. These
contributions do not reduce your taxable income or give you a tax deduction.
There are different annual contribution limits for the annuities offered in this
prospectus. Purchase payments in excess of the limits may result in adverse tax
consequences. Contributions to a Non-Qualified annuity are on an after-tax
basis. After-tax means that your purchase payments to your annuity do not reduce
your taxable income or give you a tax deduction. Generally, Traditional IRAs can
accept deductible (or pre-tax) and non-deductible (after-tax) contributions.
Whether you can make deductible contributions to your Traditional IRA depends on
your personal situation.
We are not responsible for determining if your employer's plan or arrangement
satisfies the requirements of the Code and/or ERISA.
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Because these products are intended for retirement, if you make a taxable
withdrawal before age 59 1/2 you may incur a tax penalty.
When you withdraw money from your Deferred Annuity, the amount reported as
income differs depending on:
o the type of annuity you purchase, (e.g., Non-Qualified or IRA) and
o the type of pay-out option you elect.
For your Traditional IRA, Non-Qualified and PEDC annuities we will withhold a
portion of the taxable amount of your withdrawal for income taxes, unless you
elect otherwise. The amount we withhold is determined by the Code. For
withdrawals from a TSA or 403(a) annuity, please see the 20% mandatory
withholding discussion.
Withdrawals Before Age 59 1/2 (except PEDC)
If you receive a taxable distribution from your Deferred Annuity before you
reach age 59 1/2 this amount may be subject to a 10% penalty tax, in addition to
ordinary income taxes.
As indicated in the chart below, some distributions prior to age 59 1/2 are
exempt from the penalty. Some of these exceptions include amounts received:
Type of Contract
---------------------------------
Non Trad.
Qualified IRA TSA 403(a)
--------- ----- --- -----
In a series of substantially equal payments
made annually (or more frequently) for life
or life expectancy (SEPP) x x x1 x
After you die x x x x
After you become totally disabled (as
defined in the Code) x x x x
After separation from service if
you are over age 55. x x
To pay deductible medical expenses x x x
To pay medical insurance premiums if
you are unemployed x
After December 31, 1997 to pay for
qualified higher education expenses, or x
After December 31, 1997 for qualified
first time home purchases up to $10,000 x
1 You must also be separated from service.
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Mandatory 20% Withholding [For TSA and 403(a)]
For TSA and 403(a) Deferred Annuities, we are required to withhold 20% of the
taxable portion of your withdrawal that constitutes an "eligible rollover
distribution" for Federal income taxes. We are not required to withhold this
money if you direct us, the trustee or the custodian of the plan to transfer
your eligible rollover distribution to a traditional IRA, or another eligible
retirement plan.
An "eligible rollover distribution" is any taxable amount you receive from your
Deferred Annuity. It does not include taxable distributions that are:
o A series of substantially equal payments made at least annually for:
o Your life or life expectancy
o Both you and your beneficiary's lives or life expectancies
o A specified period of 10 years or more
o Withdrawals to satisfy minimum distribution requirements
Other exceptions to the definition of eligible rollover distribution exist.
For taxable withdrawals that are not "eligible rollover distributions," the Code
requires different witholding rules. The witholding amount is determined at the
time of payment. You may elect out of these withholding requirements.
Systematic Withdrawal Program for Substantially Equal Periodic Payments (SEPP)
If you are considering using the Systemic Withdrawal Program for the purpose of
meeting the SEPP exception to the 10% tax penalty, consult with your tax
advisor.
If you receive systematic payments that you intend to qualify for the SEPP
exception, any modifications to your payment before age 59 1/2 or within five
years after beginning Systematic Withdrawal Program payments will result in the
retroactive imposition of the 10% penalty tax.
TSA
General
TSAs fall under Section 403(b) of the Code which provides certain tax benefits
to eligible employees of public school systems and organizations that are tax
exempt under Section 501(c)(3) of the Code.
Your employer buys the Annuity for you although you then own it.
Your Deferred Annuity is not forfeitable (e.g., not subject to claims of your
creditors) and you may not transfer it. However, you may transfer withdrawals to
another Section 403(b) funding vehicle or (for eligible rollover
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distributions) to an IRA without Federal tax consequences if Code requirements
are met.
Contributions
There are annual contribution limits to your Deferred Annuity. Purchase payments
over this amount may be subject to adverse tax consequences. Special rules apply
to the withdrawal of excess contributions.
Withdrawals
Withdrawals and income payments are included in income, except for the portion
that represents a return of non-deductible purchase payments.
________________________________________________________________________________
You may be subject to the 10% penalty tax if you withdraw money before you turn
age 59 1/2.
________________________________________________________________________________
If you are under age 59 1/2 you cannot withdraw money from your Deferred Annuity
unless the withdrawal:
o Relates to contributions prior to 1989 and earnings on those contributions.
o Is directly transferred to other 403(b) arrangements;
o Relates to amounts that are not salary reduction elective deferrals (i.e.,
attributed to your pre-tax contributions and their earnings.);
o Is after you leave your job, after you die, or become disabled (as defined by
Code.); or
o Is for financial hardship but only to the extent of purchase payments if your
plan allows it.
If certain requirements are met, you may be able to transfer amounts in your
Deferred Annuity to another TSA or IRA.
Minimum Distribution Requirements
Generally, you must begin receiving withdrawals from your Deferred Annuity by
April 1 of the calendar year following the later of:
o The year you turn age 70 1/2 or;
o Provided you do not own 5% or more of your employer, and to the extent
permitted by your plan and Deferred Annuity, the year you retire.
Complex rules apply to timing and calculating these withdrawals. A tax penalty
of 50% applies to withdrawals which should have been taken but were not.
After Death
If you die before required minimum distribution withdrawals have begun, we must
make payment of your entire interest in the Deferred Annuity within five years
after the year of your death or begin payments under an income annuity allowed
by the Code to your beneficiary by December 31st of the year after your death.
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If your spouse is your beneficiary and if your Deferred Annuity permits, your
spouse may delay the start of income payments until December 31st of the year in
which you would have reached age 70 1/2.
If you die after required withdrawals begin, payments must continue at least as
rapidly as under the distribution method in effect at your death.
403(a)
General
The employer adopts a 403(a) plan as a qualified retirement plan to provide
benefits to participating employees. The plan generally works in a similar
manner to a corporate qualified retirement plan except that the 403(a) plan does
not have a trust or a trustee.
Contributions
There are annual contribution limits to your Deferred Annuity. Purchase payments
over this amount may be subject to adverse tax consequences. Special rules apply
to the withdrawal of excess contributions.
Withdrawals
Because your contributions are generally on a before tax basis, you pay income
taxes on the full amount of money you withdraw as well as income earned under
the Deferred Annuity. If you made any after tax contributions they would not be
subject to income tax when withdrawn.
If certain requirements are met, you may be able to transfer amounts in your
Deferred Annuity to another eligible retirement plan or IRA.
Minimum Distribution Requirements
Generally, you must begin receiving withdrawals from your Deferred Annuity by
April 1 of the calendar year following the later of:
o The year you turn age 70 1/2 or;
o Provided you do not own 5% or more of your employer, and to the extent
permitted by your plan and Deferred Annuity, the year you retire.
Complex rules apply to timing and calculating these withdrawals. A tax penalty
of 50% applies to withdrawals which should have been taken but were not.
After Death
If you die before required minimum distribution withdrawals have begun, we must
make payment of your entire interest in the Deferred Annuity within five years
after the year of your death or begin payments under an income annuity allowed
by the Code to your beneficiary by December 31st of the year after your death.
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If your spouse is your beneficiary and if your contract permits, your spouse may
delay the start of income payments until December 31st of the year in which you
would have reached age 70 1/2.
If you die after required withdrawals begin, payments must continue at least as
rapidly as under the distribution method in effect at your death.
Traditional IRA Annuities
Generally, your IRA can accept deductible (or pre-tax) and non-deductible
(after-tax) contributions. Deductible or pre-tax purchase payments will be
taxable when distributed from the Deferred Annuity.
o Your annuity is generally not forfeitable (e.g. not subject to claims of your
creditors) and you may not transfer it to someone else.
o You can transfer your IRA proceeds to a similar IRA, without incurring Federal
income taxes if certain conditions are satisfied.
Contributions
Generally:
________________________________________________________________________________
In some cases, your purchase payments may be tax deductible.
________________________________________________________________________________
o Contributions to traditional IRAs are limited to the lesser of 100% of
compensation or $2,000 per year. A $2,000 contribution can also be made for a
non-working spouse provided the couple's compensation is at least equal to
their aggregate contributions.
o Contributions in excess of this amount may be subject to a penalty tax.
________________________________________________________________________________
Annual contributions to all your Traditional IRAs may not exceed the lesser of
$2,000 or 100% of your compensation.
________________________________________________________________________________
o Contributions are generally permitted up to age 70 1/2.
o These age and dollar limits do not apply to tax-free rollovers or transfers.
o If certain conditions are met, you can change your Traditional IRA
contribution to a Roth IRA before you file your income tax return (including
filing extensions).
Withdrawals
Withdrawals are included in income except for the portion that represents a
return of non-deductible purchase payments. This portion is determined based on
a ratio of all non-deductible contributions to the total value of all your IRAs.
Generally you must begin receiving withdrawals by April 1 of the calendar year
following the year in which you reach age 70 1/2.
________________________________________________________________________________
You may combine the money required to be withdrawn from each of your Traditional
IRAs and withdraw this amount from any one or more of them.
________________________________________________________________________________
A tax penalty of 50% applies to withdrawals which should have been taken but
were not. Complex rules apply to the timing and calculation of these
withdrawals.
FFA-63
<PAGE>
After Death
Generally, if you die before required minimum distribution withdrawals have
begun we must make payment of your entire interest within five years after the
year of your death or begin income payments under an income annuity allowed by
the Code to your beneficiary by December 31st of the year after your death.
If your spouse is your beneficiary, and, if your Deferred Annuity permits, your
spouse may delay the start of income payments until December 31 of the year in
which you would have reached age 70 1/2.
________________________________________________________________________________
If your spouse is your beneficiary and if your Deferred Annuity permits, he or
she may elect to continue as "owner" of the Deferred Annuity.
________________________________________________________________________________
If you die after required withdrawals begin, payments must continue at least as
rapidly as under the distribution method in effect at your death.
Non-Qualified Annuities
________________________________________________________________________________
After-tax means that your purchase payments to your annuity do not reduce your
taxable income or give you a tax deduction.
________________________________________________________________________________
o Contributions to Non-Qualified annuities are on an "after-tax" basis, so you
only pay income taxes on your earnings. Generally, these earnings are taxed
when you receive them from the Deferred Annuity.
o Your Non-Qualified annuity may be exchanged for another Non-Qualified annuity
without paying income taxes if certain Code requirements are met.
o When a non-natural person owns a Non-Qualified annuity, the annuity will
generally not be treated as an annuity for tax purposes and thus loses the
benefit of tax deferral. Corporations and certain other entities are generally
considered non-natural persons. However, an annuity owned by a non-natural
person as agent for an individual will be treated as an annuity for tax
purposes.
o Annuities issued after October 21, 1988 by the same insurance company in the
same year are combined for tax purposes. As a result, a greater portion of
your withdrawals may be considered taxable income than you would otherwise
expect.
Contributions
Although the Code does not limit the amount of your purchase payments, your
contract may limit them.
Withdrawals
Generally, when you make a withdrawal from your non-qualified annuity, the Code
treats such a withdrawal as:
o First coming from earnings (and thus subject to income tax); and
o Then from your purchase payments (which are not subject to income tax).
FFA-64
<PAGE>
Different tax rules apply to payments made pursuant to an Income Annuity or
pay-out option under your Deferred Annuity. They are subject to an "exclusion
ratio" which determines how much of each payment is treated as:
o A non-taxable return of your contributions; and
o A taxable payment of earnings.
If you choose a payout option under your Deferred Annuity we generally will tell
you how much of each income payment is a non-taxable return of contributions.
Generally, once the total amount treated as a non-taxable return of your
purchase payments equals your purchase payments, then all remaining income
payments are fully taxable.
Under the Code, withdrawals from Non-Qualified annuities need not be made by a
particular age. However, it is possible that the Internal Revenue Service may
determine that you must take a lump sum withdrawal or elect to receive income
payments by a certain age (e.g., 85).
Systematic Withdrawal Program for Substantially Equal Periodic Payments (SEPP)
If you are considering using the Systemic Withdrawal Program for the purpose of
meeting the SEPP exception to the 10% tax penalty, consult with your tax
advisor.
If you receive systematic payments that you intend to qualify for the SEPP
exception, any modifications to your payment before age 59 1/2 or within five
years after beginning Systematic Withdrawal Program payments will result in the
retroactive imposition of the 10% penalty tax.
After Death
If you die before payments under a pay-out option under a Deferred Annuity
begins, we must make payment of your entire interest within five years of your
death or begin payments under an Income Annuity allowed by the Code to your
beneficiary within one year of your death.
________________________________________________________________________________
If you die during the pay-in phase of a Deferred Annuity and your spouse is your
beneficiary or a co-owner, he or she may elect to continue as "owner" of the
contract.
________________________________________________________________________________
If you die after income payments begin, payments must continue to be made at
least as rapidly as before your death in accordance with the income type
selected.
If you die before all purchase payments are returned, the unreturned amount may
be deductible on your final income tax return or excluded from income by your
beneficiary if income payments continue after your death.
Non-Qualified Annuity for Section 457(f) Deferred Compensation Plans.
These are deferred compensation arrangements generally for a select group of
management or highly compensated employees and individual independent
contractors employed or engaged by state or local governments or non-church
tax-exempt entity (e.g., a hospital) contributes your deferred compensation
amounts and earnings credited to these amounts into a trust, which at all times
is subject to the claims of the employer's bankruptcy and insolvency creditors.
The trust owns a Non-
FFA-65
<PAGE>
Qualified annuity which may be subject to the rules described under
"Non-Qualified Annuities." Since the trust is a grantor trust, any tax
consequences arising out of ownership of the Non-Qualified annuity will flow to
the tax-exempt entity that is the grantor of such trust. Each tax-exempt entity
should consult its own tax advisor with respect to the tax rules governing the
annuity. You can defer taxation of compensation until the first taxable year in
which there is not a substantial risk of forfeiture to your right to such
compensation.
When deferred compensation is no longer subject to a substantial risk of
forfeiture, it is immediately includable in your income and it becomes
"after-tax" contributions for the purposes of the tax rules governing income
plan payments in calculating the "exclusion ratio." Certain distributions made
before you are age 59 1/2 may be subject to a 10% tax penalty. It is unclear
whether this penalty applies with respect to distributions made for this type of
plan. Thus, you should consult your own tax advisor to clarify this issue. Since
there is some uncertainty as to how the Internal Revenue Service and the courts
will treat the "rolling vesting" aspect of this arrangement, you should consult
your own tax advisor to clarify this issue. Given the complexity and uncertainty
inherent in this area of the tax law, entities considering the purchase of this
annuity to fund a Section 457(f) deferred compensation plan should consult with
their own tax advisors regarding the major Federal tax issues under Section
457. In connection with the sale of the Non-Qualified annuity for Section
457(f) Deferred Compensation Plans, MetLife consulted special tax counsel
regarding the major Federal tax issues under Section 457. This advice from such
counsel has not been updated to reflect changes, if any, in the law. Such advice
was rendered solely to MetLife and may not be relied upon by any person
considering the purchase of the annuity.
Non-Qualified Annuity for Section 451 Deferred Fee Arrangements.
Under Section 451 deferred fee arrangements, a third party which is a
tax-exempt entity (e.g., a hospital) enters into an arrangement with a taxable
entity, the employer, that provides services to the third party. These deferred
fees are used to fund a deferred compensation plan for the taxable entity's
employees who are a select group of management or highly compensated employees
or individual independent contractors. The deferred fees are contributed by the
tax-exempt entity into a trust that is subject to the claims of its bankruptcy
and insolvency creditors, and when paid or made available to the taxable entity,
are subject to the claims of the taxable entity's bankruptcy and insolvency
creditors. Such arrangement, in accordance with the provisions of Section 451,
enables the taxable entity to defer compensation until the year in which the
amounts are paid or made available to it, and enables the employees of the
taxable entity who are participants in its deferred compensation plan to defer
compensation until the year in which the amounts are paid or made available to
them, unless under the method of accounting used in computing taxable income,
such amount is to be properly accounted for in a different period. The taxable
FFA-66
<PAGE>
entity will be able to deduct as employee compensation the amounts included in
income by the participant employees of its deferred compensation plan, subject
to such sums being reasonable compensation and not disguised dividends.
A trust established by the tax-exempt entity will own a Non-Qualified
annuity which may be subject to taxation rules as described under "Non-Qualified
Annuities." Since the trust is a grantor trust, any tax consequences arising out
of ownership of the Non-Qualified annuity will flow to the tax-exempt entity
that is the grantor of such trust. Each tax-exempt entity should consult its own
tax advisor with respect to the tax rules governing the annuity. Participants in
the taxable entity's deferred compensation plan must look to the taxable entity
for payments under the plan. These persons should consult their own tax advisor
for information on the tax treatment of these payments made under the plan.
Given the complexity and uncertainty inherent in this area of the tax law,
entities considering the purchase of this annuity to fund a Section 451
deferred fee arrangement should consult with their own tax advisors regarding
the application of the relevant rules to their particular situation. In
connection with the sale of the Non-Qualified annuity for Section 451 Deferred
Fee Arrangements, MetLife consulted special tax counsel regarding the major
Federal tax issues under Section 451. This advice from such counsel has not
been updated to reflect changes, if any, in the law and such advice was rendered
solely to MetLife and may not be relied upon by any person considering the
purchase of the annuity.
Non-Qualified Annuity for Section 451 Deferred Compensation Plans.
Under a Section 451 deferred compensation plan, a select group of management or
highly compensated employees or individual independent contractors can defer
compensation until the year in which the amounts are paid or made available to
them unless, under the method of accounting used in computing taxable income,
such amounts are to be properly accounted for in a different period.
Participants should consult their own tax advisors for information on the tax
treatment of these payments.
A Section 451 plan could be sponsored by either a taxable entity or certain
tax-exempt entities which meet the "grandfather" requirements described below.
Taxable entities would be able to deduct, as compensation, the amounts included
in income by the participant of the deferred compensation plan, subject to such
sums being reasonable compensation and not disguised dividends. For tax-exempt
entities, if certain Tax Reform Act of 1986 "grandfather" requirements are
adhered to, Section 451 rather than Section 457 should apply to their deferred
compensation plans. Tax exempt entities should consult their own tax advisors to
ascertain whether these "grandfather" requirements are met.
A trust established by either the taxable or the grandfathered tax-exempt entity
would own a Non-Qualified annuity which may be subject to taxa-
FFA-67
<PAGE>
tion rules as described under "Non-Qualified Annuities." Since the trust would
be a grantor of trust, any tax consequences arising out of ownership of the
Non-Qualified annuity will flow to the tax-exempt entity or taxable entity that
is the grantor of such trust. Such entities should consult their own tax
advisors with respect to the tax rules governing
the annuity.
Given the complexity and uncertainty inherent in this area of the tax law,
entities considering the purchase of this annuity to fund a Section 451
deferred compensation plan should consult with their own tax advisors regarding
the application of the relevant rules to their particular situation. In
connection with the sale of the Non-Qualified annuity for Section 451 Deferred
Compensation Plans, MetLife consulted special tax counsel regarding the major
Federal tax issues under Section 451. This advice from such counsel has not
been updated to reflect changes, if any, in the law and such advice was rendered
solely to MetLife and may not be relied upon by any person considering the
purchase of the annuity.
Non-Qualified Annuity for Section 457(e)(11) Severance and Death Benefit Plans.
These are severance and death benefit arrangements for adoption by tax-exempt
entities. If the employer is subject to ERISA, the arrangement must be adopted
exclusively for a select group of management or highly compensated employees or
individual independent contractors. The employer deposits deferral amounts,
which will be used to provide severance and death benefits, into a trust which
is subject at all times to the claims of the employer's bankruptcy and
insolvency creditors. As the owner of a Non-Qualified annuity, the trust may be
subject to the rules described under "Non-Qualified Annuities." Since the trust
is a grantor trust, any tax consequences arising out of ownership of the
Non-Qualified annuity will flow to the employer, the grantor of such trust. Each
employer should consult with its own tax advisor with respect to the tax rules
governing the annuity.
The Federal income tax consequences to you of this arrangement depend on whether
the program qualifies as a "bona-fide severance pay" and a "bona-fide death
benefit" plan as described in Section 457(e)(11) of the Code. If the
arrangement qualifies as a "bona-fide severance pay" and a "bona-fide death
benefit" plan, Section 451 of the Code will apply and you will not be taxed on
your deferral amounts until the tax year in which they are paid or made
available to you, unless under the method of accounting you use in computing
taxable income, such amount is to be properly accounted for in a different
period. If the arrangement does not qualify as a "bona-fide severance pay" and a
"bona-fide death benefit" plan, your deferral amounts are subject to tax in the
year in which they are deferred. In that event, if you have not reported such
income, in addition to the Federal income tax you will have to pay, you will be
assessed interest, and you may be subject to certain penalties by the Internal
Revenue Service.
FFA-68
<PAGE>
Special Tax Considerations for Non-Qualified Annuity for Section 457(e)(11)
Severance and Death Benefit Plans.
There is a considerable risk that this arrangement may not qualify as a
"bona-fide severance pay" plan under 457(e)(11), the application section of the
Code. The term "bona-fide severance pay" plan is not defined in that section.
The term "severance pay" plan has, however, been construed under other Code
section and under Department of Labor regulations issued under the Employee
Retirement Income Security Act of 1974. Subsequently, the United States Court of
Appeals for the Federal Circuit indicated that for the purposes of another Code
section, a severance pay plan with features similar to this arrangement, would
not qualify as a valid severance pay plan. While this decision addresses
severance pay plans in a different Code context, it is probable that a court
would consider it in determining the tax consequences of this arrangement. In
connection with the sale of the Non-Qualified annuity for Section 457(e)(11)
Severance and Death Benefit Plans, MetLife consulted special tax counsel
regarding the major Federal tax issues under Section 457. This advice received
from such counsel has not been updated to reflect this decision or other changes
in the law, and such advice was rendered solely to MetLife and may not be relied
upon by any person considering the purchase of the annuity. You should consult
with your own tax advisor to determine if the potential advantages to you of
this arrangement outweigh the potential tax risks in view of your individual
circumstances.
Non-Qualified Annuity for Section 415(m) Qualified Governmental Excess Benefit
Plans.
Section 415(m) qualified governmental excess benefit plans are available to
state and local governments which sponsor plans subject to the Section 415
limits on the amount of annual plan contributions and benefits. If a qualified
governmental excess benefit arrangement meets certain requirements, it could
provide benefits that cannot be provided under a government plan subject to the
Section 415 limits. For purposes of the qualified governmental excess benefit
arrangement, participants are taxed the same way as if the arrangement were a
non-qualified deferred compensation plan maintained by an employer not exempt
from tax. Since qualified governmental excess benefit arrangements were
introduced into the tax law in August, 1996, and since many aspects of these
arrangements have yet to be clarified by the IRS, entities considering the
purchase of this annuity to fund a qualified governmental excess benefit plan
should consult with their own tax advisors regarding the application of the
relevant rules to their particular situation.
PEDC
General
PEDC plans are available to State or local governments and certain tax-exempt
organizations as described in Section 457 of the Code. The plans are not
FFA-69
<PAGE>
available for churches and qualified church-controlled organizations.
PEDC annuities maintained by a state or local government are for the exclusive
benefit of plan participants and their beneficiaries.
PEDC annuities other than those maintained by state or local governments are
solely the property of the employer and are subject to the claims of the
employer's general creditors until they are "made available" to you.
Withdrawals
Generally, because contributions are on a before-tax basis, withdrawals from
your annuity are subject to income tax.
Generally, monies in your annuity can not be "made available" to you until you:
o Reach age 70 1/2
o Leave your job
o Have an unforeseen emergency (as defined by the Code)
If certain requirements are met, you can transfer amounts in your PEDC annuity
to another PEDC plan.
Minimum Distribution
The minimum distribution requirements for PEDC are similar to those described in
the TSA section, however, there are certain differences.
After Death
If you die before required minimum distribution withdrawals have begun, we must
make payment of your entire interest in the annuity within five years after the
year of your death or begin payments under an income annuity allowed by the Code
to your beneficiary by December 31st of the year after your death.
If your spouse is your beneficiary and if your annuity permits, your spouse may
delay the start of income payments until December 31st of the year in which you
would have reached age 70 1/2.
If you die after required withdrawals begin, payments must continue at least as
rapidly as under the distribution method in effect at your death.
Special Rules
Special rules apply to certain non-governmental PEDC plans deferring
compensation from taxable years beginning before January 1, 1987 (or beginning
later but based on an agreement in writing on August 16, 1986).
See the general heading under Income Taxes for a brief description of the tax
rules that apply to PEDC annuities.
FFA-70
<PAGE>
Table of Contents for the Statement of Additional Information
Page
Cover Page ............................................................ 1
Table of Contents ..................................................... 1
Independent Auditors .................................................. 2
Services .............................................................. 2
Year 2000 ............................................................. 2
Distribution of Certificates and Interests in the
Deferred Annuities and Income Annuities ......................... 2
Early Withdrawal Charge ............................................... 2
Experience Factor ..................................................... 2
Variable Income Payments .............................................. 2
Investment Management Fees ............................................ 5
Performance Data and Advertisement of
the Separate Account ............................................ 6
Voting Rights ......................................................... 7
Erisa ................................................................. 8
Taxes ................................................................. 9
Performance Data ...................................................... 22
Financial Statements of the Separate Account ..........................
Financial Statements of MetLife .......................................
FFA-71
<PAGE>
Appendix
Annuity Tax Table
If you are a resident of one of the following jurisdictions, the percentage
amount listed by that jurisdiction is the annuity tax rate which will be applied
to your Deferred Annuity or Income Annuity.
<TABLE>
<CAPTION>
TSA 403(a) PEDC Traditional Non-Qualified
Deferred Deferred Deferred IRA Deferred Deferred
and and and and and
Income Income Income Income Income
Annuities Annuities Annuities(1) Annuities(2) Annuities
<S> <C> <C> <C> <C> <C> <C>
California .......... 0.5% 0.5% 2.35% 0.5%(3) 2.35%
Kentucky(4).......... 2.0% 2.0% 2.0% 2.0% 2.0%
Maine................ -- -- -- -- 2.0%
Nevada............... -- -- -- -- 3.5%
Puerto Rico.......... 1.0% 1.0% 1.0% 1.0% 1.0%
South Dakota......... -- -- -- -- 1.25%
U.S. Virgin Islands.. 5.0% 5.0% 5.0% 5.0% 5.0%
West Virginia........ 1.0% 1.0% 1.0% 1.0% 1.0%
Wyoming.............. -- -- -- -- 1.0%
</TABLE>
- ---------------
1 Annuity tax rates applicable to Deferred Annuities and Income Annuities
purchased under retirement plans of public employers meetings the requirements
of Section 401(a) of the Code are included under the column headed "403(a)
Deferred and Income Annuities."
2 Annuity tax rates applicable to Traditional IRA Deferred Annuities and Income
Annuities purchased for use in connection with individual retirement trust or
custodial accounts meeting the requirements of Section 408(a) of the Code are
included under the column headed "Traditional IRA Deferred and Income
Annuities."
3 With respect to Deferred Annuities and Income Annuities purchased for use in
connection with individual retirement trust or custodial accounts meeting the
requirements of Section 408(a) of the Code, the annuity tax rate in California
is 2.35% instead of 0.5%.
4 The annuity tax in Kentucky is repealed effective January 1, 2000.
FFA-72
<PAGE>
Appendix II
What You Need To Know If You Are A Texas Optional Retirement Program Participant
If you are a participant in the Texas Optional Retirement Program, Texas law
permits us to make withdrawals on your behalf only if you die, retire or
terminate employment in all Texas institutions of higher education, as defined
under Texas law. Any withdrawal you ask for requires a written statement from
the appropriate Texas institution of higher education verifying your vesting
status and (if applicable) termination of employment. Also, we require a written
statement from you that you are not transferring employment to another Texas
institution of higher education. If you retire or terminate employment in all
Texas institutions of higher education or die before being vested, amounts
provided by the state's matching contribution will be refunded to the
appropriate Texas institution. We may change these restrictions or add others
without your consent to the extent necessary to maintain compliance with the
law.
FFA-73
<PAGE>
Bulk Rate
U.S. Postage Paid
Rutland, VT
Permit 220
[LOGO OF METROPOLITAN LIFE INSURANCE COMPANY]
Metropolitan Life Insurance Company
Johnstown Office, 500 Schoolhouse Road
Johnstown, PA 15904-2914
Address Service Requested
FFA-74
<PAGE>
APPENDIX FOR GRAPHIC AND IMAGE MATERIAL
Pursuant to Rule 304 of Regulation S-T, the following table presents fair and
accurate narrative descriptions of graphic and image material omitted from the
EDGAR filing due to ASCII-incompatibility and cross-references this material to
the location of each occurrence in the text.
INTRODUCTION
The four prospectuses included in the Form N-4 for Metropolitan Life Separate
Account E include illustrations using various characters from the
PEANUTS(Registered) gang which are copyrighted by United Feature Syndicate,
Inc. There is a list and description of characters followed by a list of
illustrations and their page location in the prospectuses (by prospectus).
CHARACTERS
Snoopy -- A Beagle dog
Charlie Brown -- A little boy with zigzag pattern on shirt
Woodstock -- A small bird
Lucy -- A little brunette girl
Linus -- A younger little boy with stripped shirt (Lucy's brother)
Marcie -- A little brunette girl with glasses
Franklin -- A curly haired little boy
Pigpen -- A little boy with dust cloud and smudged face
Peppermint Patty -- An athletic girl with freckles, page boy haircut and sandals
Sally -- A little blond girl with curls on top (Charlie Brown's sister)
A. ILLUSTRATIONS FOR PREFERENCE PLUS ACCOUNT VARIABLE
ANNUITY CONTRACTS FOR NON-QUALIFIED, TRADITIONAL
IRA, ROTH IRA, SIMPLE IRA AND SEP IRA PAGE
1. Snoopy as MetLife Representative with briefcase A-PPA cover
straightening bow tie
2. Charlie Brown on step ladder looking at fold A-PPA-3 Table of Contents
out map
3. Snoopy in suit with pointer A-PPA-4 Important Terms
You Should Know
4. Lucy reviewing ticker tape coming from machine A-PPA-9 Accumulation
Unit Values Tables
5. Snoopy as MetLife Representative listening to A-PPA-13 MetLife
crowd of Woodstocks
6. Snoopy and Woodstock balanced on seesaw A-PPA-14 The Variable
Annuities in this
Prospectus
7. Snoopy reading menu at restaurant table A-PPA-15 Your Investment
Choices
8. Linus building sand castle A-PPA-16 Deferred
Annuities
9. The Equity Generator(Service Mark) icon--Safe A-PPA-17 The Equity
with arrow pointing to three dimensional graph Generator
<PAGE>
A. ILLUSTRATIONS FOR PREFERENCE PLUS ACCOUNT VARIABLE
ANNUITY CONTRACTS FOR NON-QUALIFIED, TRADITIONAL
IRA, ROTH IRA, SIMPLE IRA AND SEP IRA (Continued) PAGE
10. The Equalizer(Service Mark) icon--A balancing A-PPA-17 The Equalizer
scale
11. The Rebalancer(Service Mark) icon--A pie chart A-PPA-17 The Rebalancer
with arrows around circumference
12. The Index Selector(Service Mark) icon--A world A-PPA-17 The Index
globe with arrows around it Selector
13. The Allocator(Service Mark)--A hourglass with A-PPA-18 The Allocator
safe in top portion with arrow to a three
dimensional chart in the bottom portion
14. Snoopy as MetLife Representative typing at A-PPA-18 Electronic
computer Applications
15. Woodstock making calculations on paper with A-PPA-19 The Value of
pencil Your Investment
16. Marcie at desk with adding machine reviewing A-PPA-20 Examples of
tape of calculations calculating Accumulation
Units and Accumulation
Unit Value
17. Charlie Brown struggling to reach into jar of A-PPA-21 Access to Your
money Money
18. Snoopy as WWI flying ace dispatching Woodstocks A-PPA-21 Systematic
with checks Withdrawal Program
19. Woodstock with accountant's visor and adding A-PPA-23 Charges
machine
20. Franklin with magnifying glass A-PPA-25 When No Early
Withdrawal Charge Applies
21. Woodstock moving money bag from one pile of A-PPA-26 When Another
money bags to another Early Withdrawal Charge
May Apply
22. Death certificate scroll A-PPA-27 Death Benefit
23. Snoopy floating in innertube with glasses and A-PPA-28 Income Annuities
drink
24. Snoopy lounging on beach chair with sunglasses A-PPA-29 Income Payment
and drink Types
25. Woodstock writing out a check A-PPA-30 Purchasing an
Income Annuity
26. Woodstock moving money bag from one pile of A-PPA-31 Transfers
money bags to another
27. Lucy with magnifying glass studying a piece of A-PPA-32 Free Look
paper
<PAGE>
A. ILLUSTRATIONS FOR PREFERENCE PLUS ACCOUNT VARIABLE
ANNUITY CONTRACTS FOR NON-QUALIFIED, TRADITIONAL
IRA, ROTH IRA, SIMPLE IRA AND SEP IRA (Continued) PAGE
28. Charlie Brown receiving letter at mail box A-PPA-33 Confirming
Transactions
29. Charlie Brown listening on telephone A-PPA-34 Transactions by
Telephone
30. "Colonial" Snoopy as town cryer A-PPA-35 Advertising
Performance
31. Snoopy as MetLife Representative shaking paw/ A-PPA-37 Who Sells the
wing with Woodstock Deferred Annuities and
Income Annuities
32. Piggybank with "Do not open until age 59 1/2" A-PPA-38 Income Taxes--
printed on side General
33. Snoopy as "Uncle Sam" presenting a tax bill A-PPA-39 Income Taxes--
Withdrawals
34. Snoopy as "Uncle Sam" collecting taxes from A-PPA-40 Income Taxes--
Charlie Brown who is digging in his pockets Non-Qualified Annuities
for money
35. Linus "walking" the hoop with "IRAs" on side A-PPA-42 Income Taxes--
IRAs
36. Woodstock flying with check A-PPA-43 Roth IRA
Annuities--Withdrawals
37. Franklin, Snoopy, Charlie Brown, Lucy, Pigpen, A-PPA-46 Table of
Linus and Peppermint Patty Contents for the SAI
38. Lucy in her advice box with "TAXES--The Expert A-PPA-47 Annuity Tax
is in" printed on it advising Peppermint Patty Table
and Sally
<PAGE>
B. ILLUSTRATIONS FOR PREFERENCE PLUS ACCOUNT VARIABLE
ANNUITY CONTRACTS FOR TSA, PEDC, KEOGH AND 403(a) PAGE
1. Snoopy as MetLife Representative with briefcase B-PPA cover
straightening bow tie
2. Charlie Brown on step ladder looking at fold B-PPA-3 Table of Contents
out map
3. Snoopy in suit with pointer B-PPA-4 Important Terms
You Should Know
4. Lucy reviewing ticker tape coming from machine B-PPA-9 Accumulation
Unit Values Tables
5. Snoopy as MetLife Representative listening to B-PPA-13 MetLife
crowd of Woodstocks
6. Snoopy and Woodstock balanced on seesaw B-PPA-14 The Variable
Annuities in this
Prospectus
7. Snoopy reading menu at restaurant table B-PPA-15 Your Investment
Choices
8. Linus building sand castle B-PPA-16 Deferred
Annuities
9. The Equity Generator(Service Mark) icon--Safe B-PPA-17 The Equity
with arrow pointing to three dimensional graph Generator
10. The Equalizer(Service Mark) icon--A balancing B-PPA-17 The Equalizer
scale
11. The Rebalancer(Service Mark) icon--A pie chart B-PPA-18 The Rebalancer
with arrows around circumference
12. The Index Selector(Service Mark) icon--A world B-PPA-18 The Index
globe with arrows around it Selector
13. The Allocator(Service Mark)--A hourglass with B-PPA-18 The Allocator
safe in top portion with arrow to a three
dimensional chart in the bottom portion
14. Woodstock making calculations on paper with B-PPA-19 The Value of
pencil Your Investment
15. Marcie at desk with adding machine reviewing B-PPA-20 Examples of
tape of calculations calculating Accumulation
Units and Accumulation
Unit Value
16. Charlie Brown struggling to reach into jar of B-PPA-21 Access to Your
money Money
17. Snoopy as WWI flying ace dispatching Woodstocks B-PPA-22 Systematic
with checks Withdrawal Program
18. Woodstock with accountant's visor and adding B-PPA-24 Early Withdrawal
machine Charges
<PAGE>
B. ILLUSTRATIONS FOR PREFERENCE PLUS ACCOUNT VARIABLE
ANNUITY CONTRACTS FOR TSA, PEDC, KEOGH AND 403(a)
(continued) PAGE
19. Franklin with magnifying glass B-PPA-25 When No Early
Withdrawal Charge Applies
20. Woodstock moving money bag from one pile of B-PPA-27 When Another
money bags to another Early Withdrawal Charge
May Apply
21. Death certificate scroll B-PPA-29 Death Benefit
22. Snoopy floating in innertube with glasses and B-PPA-30 Income Annuities
drink
23. Snoopy lounging on beach chair with sunglasses B-PPA-31 Income Payment
and drink Types
24. Snoopy with accountant's visor and adding B-PPA-32 The Value of
machine Your Income Payments
25. Woodstock moving money bag from one pile of B-PPA-33 Transfers
money bags to another
26. Lucy with magnifying glass studying a piece of B-PPA-34 Free Look
paper
27. Charlie Brown receiving letter at mail box B-PPA-35 Confirming
Transactions
28. Charlie Brown listening on telephone B-PPA-36 Transactions by
Telephone
29. "Colonial" Snoopy as town cryer B-PPA-37 Advertising
Performance
30. Snoopy as MetLife Representative shaking paw/ B-PPA-39 Who Sells the
wing with Woodstock Deferred Annuities and
Income Annuities
33. Piggybank with "Do not open until age 59 1/2" B-PPA-41 Income Taxes--
printed on side General
34. Snoopy as "Uncle Sam" presenting a tax bill B-PPA-42 Income Taxes--
Withdrawals Before Age
59 1/2
35. Snoopy as "Uncle Sam" collecting taxes from B-PPA-43 Income Taxes--
Charlie Brown who is digging in his pockets Mandatory 20% Withholding
for money
36. Woodstock flying with check B-PPA-44 TSA Annuities--
Withdrawals
37. Franklin, Snoopy, Charlie Brown, Lucy, Pigpen, B-PPA-46 Table of
Linus and Peppermint Patty Contents for the SAI
38. Lucy in her advice box with "TAXES--The Expert B-PPA-47 Annuity Tax
is in" printed on it advising Peppermint Patty Table
and Sally
<PAGE>
C. ILLUSTRATIONS FOR PREFERENCE PLUS ACCOUNT ENHANCED
VARIABLE CONTRACTS FOR NON-QUALIFIED, TRADITIONAL
IRA AND UNALLOCATED PAGE
1. Snoopy as MetLife Representative with briefcase C-PPA cover
straightening bow tie
2. Charlie Brown on step ladder looking at fold C-PPA-3 Table of Contents
out map
3. Snoopy in suit with pointer C-PPA-4 Important Terms
You Should Know
4. Lucy reviewing ticker tape coming from machine C-PPA-9 Accumulation
Unit Values Tables
5. Snoopy as MetLife Representative listening to C-PPA-13 MetLife
crowd of Woodstocks
6. Snoopy and Woodstock balanced on seesaw C-PPA-14 The Enhanced
Variable Annuities in
this Prospectus
7. Snoopy reading menu at restaurant table C-PPA-15 Your Investment
Choices
8. Linus building sand castle C-PPA-16 Enhanced
Deferred Annuities
9. The Equity Generator(Service Mark) icon--Safe C-PPA-17 The Equity
with arrow pointing to three dimensional graph Generator
10. The Equalizer(Service Mark) icon--A balancing C-PPA-17 The Equalizer
scale
11. The Rebalancer(Service Mark) icon--A pie chart C-PPA-17 The Rebalancer
with arrows around circumference
12. The Index Selector(Service Mark) icon--A world C-PPA-18 The Index
globe with arrows around it Selector
13. The Allocator(Service Mark)--A hourglass with C-PPA-18 The Allocator
safe in top portion with arrow to a three
dimensional chart in the bottom portion
14. Woodstock making calculations on paper with C-PPA-19 The Value of
pencil Your Investment
15. Marcie at desk with adding machine reviewing C-PPA-20 Examples of
tape of calculations calculating Accumulation
Units and Accumulation
Unit Value
16. Charlie Brown struggling to reach into jar of C-PPA-21 Access to Your
money Money
17. Snoopy as WWI flying ace dispatching Woodstocks C-PPA-22 Systematic
with checks Withdrawal Program
18. Woodstock with accountant's visor and adding C-PPA-23 Charges
machine
<PAGE>
C. ILLUSTRATIONS FOR PREFERENCE PLUS ACCOUNT ENHANCED
VARIABLE CONTRACTS FOR NON-QUALIFIED, TRADITIONAL
IRA AND UNALLOCATED (continued) PAGE
19. Franklin with magnifying glass C-PPA-25 When No Early
Withdrawal Charge Applies
20. Woodstock moving money bag from one pile of C-PPA-27 When Another
money bags to another Early Withdrawal Charge
May Apply
21. Death certificate scroll C-PPA-28 Death Benefit
22. Snoopy floating in innertube with glasses and C-PPA-30 Enhanced Income
drink Annuities
23. Snoopy lounging on beach chair with sunglasses C-PPA-31 Income Payment
and drink Types
24. Woodstock writing out a check C-PPA-32 Purchasing an
Income Annuity
25. Woodstock moving money bag from one pile of C-PPA-33 Transfers
money bags to another
26. Lucy with magnifying glass studying a piece of C-PPA-34 Free Look
paper
27. Charlie Brown listening on telephone C-PPA-35 Transactions by
Telephone
28. "Colonial" Snoopy as town cryer C-PPA-36 Advertising
Performance
29. Snoopy as MetLife Representative shaking paw/ C-PPA-39 Who Sells the
wing with Woodstock Deferred Annuities and
Income Annuities
30. Piggybank with "Do not open until age 59 1/2" C-PPA-40 Income Taxes--
printed on side General
31. Snoopy as "Uncle Sam" presenting a tax bill C-PPA-41 Income Taxes--
Withdrawals Before Age
59 1/2
32. Woodstock flying with check C-PPA-42 Non-Qualified
Annuities--Withdrawals
33. Snoopy as "Uncle Sam" collecting taxes from C-PPA-43 Income Taxes--
Charlie Brown who is digging in his pockets Non-Qualified Annuities
for money
34. Franklin, Snoopy, Charlie Brown, Lucy, Pigpen, C-PPA-47 Table of
Linus and Peppermint Patty Contents for the SAI
35. Lucy in her advice box with "TAXES--The Expert C-PPA-48 Annuity Tax
is in" printed on it advising Peppermint Patty Table
and Sally
<PAGE>
D. ILLUSTRATIONS FOR FINANCIAL FREEDOM ACCOUNT AND
ENHANCED PREFERENCE PLUS ACCOUNT VARIABLE
ANNUITIES FOR TSA, 403(a), NON-QUALIFIED AND
TRADITIONAL IRA PAGE
1. Snoopy as MetLife Representative with briefcase FFA cover
straightening bow tie
2. Snoopy as MetLife Representative with briefcase EPPA cover
straightening bow tie
3. Charlie Brown on step ladder looking at fold FFA-3 Table of Contents
out map
4. Snoopy in suit with pointer FFA-4 Important Terms You
Should Know
5. Lucy reviewing ticker tape coming from machine FFA-15 Accumulation Unit
Values Tables For
Enhanced Preference Plus
6. Lucy reviewing ticker tape coming from machine FFA-22 Accumulation Unit
Values Tables For
Financial Freedom
7. Snoopy as MetLife Representative listening to FFA-28 MetLife
crowd of Woodstocks
8. Snoopy and Woodstock balanced on seesaw FFA-29 The Variable
Annuities in this
Prospectus
9. Snoopy reading menu at restaurant table FFA-30 Your Investment
Choices
10. Linus building sand castle FFA-32 Deferred Annuities
11. The Equity Generator(Service Mark) icon--Safe FFA-33 The Equity
with arrow pointing to three dimensional graph Generator
12. The Equalizer(Service Mark) icon--A balancing FFA-33 The Equalizer
scale
13. The Rebalancer(Service Mark) icon--A pie chart FFA-34 The Rebalancer
with arrows around circumference
14. The Index Selector(Service Mark) icon--A world FFA-34 The Index Selector
globe with arrows around it
15. The Allocator(Service Mark) icon--An hourglass FFA-34 The Allocator
with safe in top portion with arrow to a three
dimensional chart in the bottom portion
16. Woodstock making calculations on paper with FFA-35 The Value of Your
pencil Investment
17. Marcie at desk with adding machine reviewing FFA-36 Examples of
tape of calculations calculating Accumulation
Units and Accumulation
Unit Value
<PAGE>
D. ILLUSTRATIONS FOR FINANCIAL FREEDOM ACCOUNT AND
ENHANCED PREFERENCE PLUS ACCOUNT VARIABLE
ANNUITIES FOR TSA, 403(a), NON-QUALIFIED AND
TRADITIONAL IRA (continued) PAGE
18. Snoopy as WWI flying ace dispatching Woodstocks FFA-37 Systematic
with checks Withdrawal Program
19. Charlie Brown struggling to reach into jar of FFA-38 Systematic
money Withdrawal Program
20. Woodstock with accountant's visor and adding FFA-39 Charges/Annuity
machine Taxes
21. Franklin with magnifying glass FFA-41 When No Early
Withdrawal Charge Applies
for TSA, 403(a), Non-
Qualified, PEDC and IRA
Enhanced Deferred
Annuities
22. Woodstock moving money bag from one pile of FFA-43 When Another Early
money bags to another Withdrawal Charge May
Apply
23. Death certificate scroll FFA-44 Death Benefit
24. Snoopy floating in innertube with glasses and FFA-46 Income Annuities
drink
25. Snoopy lounging on beach chair with sunglasses FFA-47 Income Payment
and drink Types
26. Woodstock writing out a check FFA-48 Purchasing an
Income Annuity
27. Woodstock moving money bag from one pile of FFA-49 Transfers
money bags to another
28. Lucy with magnifying glass studying a piece of FFA-50 Free Look
paper
29. Charlie Brown receiving letter at mail box FFA-51 Confirming
Transactions
30. Charlie Brown listening on telephone FFA-52 Transactions by
Telephone
31. "Colonial" Snoopy as town cryer FFA-53 Advertising
Performance
32. Snoopy as MetLife Representative shaking paw/ FFA-55 Who Sells the
wing with Woodstock Deferred Annuities and
Income Annuities
33. Snoopy as MetLife Representative at booth with FFA-56 Who Sells the
"Your MetLife Rep is IN" printed on it holding Deferred Annuities and
brochures Income Annuities
<PAGE>
D. ILLUSTRATIONS FOR FINANCIAL FREEDOM ACCOUNT AND
ENHANCED PREFERENCE PLUS ACCOUNT VARIABLE
ANNUITIES FOR TSA, 403(a), NON-QUALIFIED AND
TRADITIONAL IRA (continued) PAGE
34. Piggybank with "Do not open until age 59 1/2" FFA-58 Income Taxes--
printed on side General
35. Snoopy as "Uncle Sam" presenting a tax bill FFA-59 Income Taxes--
Withdrawals Before Age
59 1/2 (except PEDC)
36. Snoopy as "Uncle Sam" collecting taxes from FFA-61 Income Taxes--TSA
Charlie Brown who is digging in his pockets Annuities--Withdrawals
for money
37. "Corporate" Snoopy making presentation to FFA-62 Income Taxes--
boardroom with Franklin, Charlie Brown, Sally, 403(a)
Lucy, Linus and Peppermint Patty
38. Woodstock flying with check FFA-64 Non-Qualified
Annuities--Withdrawals
39. "Corporate" Snoopy with glasses and suspenders FFA-65 Income Taxes--
Systematic Withdrawal
Program
40. Snoopy with accountant's visor and adding FFA-68 Income Taxes
machine
41. Franklin, Snoopy, Charlie Brown, Lucy, Pigpen, FFA-71 Table of Contents
Linus and Peppermint Patty for the SAI
42. Lucy in her advice box with "TAXES--The Expert FFA-72 Annuity Tax Table
is in" printed on it advising Peppermint Patty
and Sally
<PAGE>
METROPOLITAN LIFE INSURANCE COMPANY
METROPOLITAN LIFE SEPARATE ACCOUNT E
PREFERENCE PLUS
AND
FINANCIAL FREEDOM ACCOUNT
GROUP AND INDIVIDUAL DEFERRED ANNUITY
AND INCOME ANNUITY DEFERRED ANNUITIES
STATEMENT OF ADDITIONAL INFORMATION
FORM N-4 PART B
April 30, 1999
This Statement of Additional Information is not a prospectus but contains
information in addition to and more detailed than that set forth in the
Prospectuses for Preference Plus and Financial Freedom Account Deferred
Annuities and Income Annuities dated April 30, 1999 and should be read in
conjunction with the Prospectuses. Copies of the Prospectuses may be obtained
from Metropolitan Life Insurance Company, One Madison Avenue, New York, New York
10010.
A Statement of Additional Information for the Metropolitan Series Fund,
Inc. is attached at the end of this Statement of Additional Information. The
Statements of Additional Information for Calvert Social Balanced Portfolio,
Calvert Social Mid Cap Growth Portfolio and Fidelity Variable Insurance Products
Funds are distributed separately.
Unless otherwise indicated, the Statement of Additional Information
continues the use of certain terms as set forth in the Section entitled
"Important Terms You Should Know" of the Prospectuses for Preference Plus
Account and Financial Freedom Account Variable Annuity Deferred Annuities dated
April 30, 1999.
------------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Independent Auditors................................. 2
Services............................................. 2
Year 2000............................................ 2
Distribution of Certificates and Interests in the
Deferred Annuities and Income Annuities............ 2
Early Withdrawal Charge.............................. 2
Experience Factor.................................... 2
Variable Income Payments............................. 2
Investment Management Fees........................... 5
Performance Data and Advertisement of the Separate
Account............................................ 6
Voting Rights........................................ 7
ERISA................................................ 8
Taxes................................................ 9
Performance Data..................................... 22
Financial Statements of the Separate Account.........
Financial Statements of MetLife......................
</TABLE>
------------------------
<PAGE>
INDEPENDENT AUDITORS
Deloitte & Touche LLP, 555 Seventeenth Street, Denver, Colorado,
independent auditors, will annually audit the Separate Account's financial
statements. The financial statements for the period ended December 31, 1998
included in this Statement of Additional Information have been audited by
Deloitte & Touche LLP, as stated in their report appearing herein, and have been
so included in reliance upon such report given upon the authority of such firm
as experts in auditing and accounting.
SERVICES
MetLife has retained FASCorp. to administer some of its group contracts in
the capacity of a third party administrator. When MetLife provides
administrative services to groups, such services may be provided to a group on a
basis more favorable than that otherwise made available to other groups.
YEAR 2000
MetLife depends on the smooth functioning of its computer systems to
administer its annuity contracts. Many computer software systems in use today
cannot distinguish the year 2000 from the year 1900 because of the way dates are
encoded and calculated. That failure could negatively impact and disrupt the
administration of the annuity contracts. MetLife is actively working on the
necessary changes to its computer systems to deal with this issue and expects
that its systems will be adapted in time for that event, although there cannot
be assurances of success.
DISTRIBUTION OF CERTIFICATES AND INTERESTS IN THE DEFERRED ANNUITIES AND INCOME
ANNUITIES
The certificates and interests in the Deferred Annuities and Income
Annuities are sold through individuals who are licensed life insurance sales
representatives of MetLife. MetLife is registered with the Securities and
Exchange Commission as a broker-dealer under the Securities Exchange Act of 1934
and is a member of the National Association of Securities Dealers, Inc. They
also are sold through other registered broker-dealers. They also may be sold
through the mail and in the case of certain Enhanced Preference Plus and VestMet
Deferred Annuities and Income Annuities and Financial Freedom Account Deferred
Annuities and Income Annuities by certain qualified employees of MetLife.
From time to time, MetLife may pay organizations or associations a fee,
reimburse them for certain expenses, lease office space from them, purchase
advertisements in their publications or enter into such other arrangements in
connection with their endorsing or sponsoring MetLife's variable annuity
contracts or services, for permitting MetLife to undertake certain marketing
efforts of the organizations' members in connection with sales of MetLife
variable annuities, or some combination thereof. Additionally, MetLife has
retained consultants who are paid a fee for their efforts in establishing and
maintaining relationships between Metropolitan Life and various organizations.
The offering of all Deferred Annuities and Income Annuities is continuous.
Owners and participants under Deferred Annuities and Income Annuities may not be
offered all investment choices. Each Deferred Annuity will indicate those
investment choices available under the Deferred Annuity or Income Annuity.
EARLY WITHDRAWAL CHARGE
The total amount of early withdrawal charges paid to and retained by
MetLife for the years ended December 31, 1996, 1997 and 1998 were $6,200,708,
$7,593,681 and $ , respectively.
EXPERIENCE FACTOR
We use the term "experience factor" to describe the investment performance
for an investment division. The experience factor changes from Valuation Period
(described later) to Valuation Period to reflect the upward or downward
performance of the assets in the underlying portfolios. The experience factor is
calculated as of the end of each Valuation Period using the net asset value per
share of the underlying portfolio. The net asset value includes the per share
amount of any dividend or capital gain distribution paid by the portfolio during
the current Valuation Period, and subtracts any per share charges for taxes and
reserve for taxes. We then divide that amount by the net asset value per share
as of the end of the last Valuation Period to obtain a factor that reflects
investment performance. We then subtract a charge for each day in the valuation
period not to exceed .000034035 (the daily equivalent of an effective annual
rate of 1.25%) for certain Deferred Annuities and for certain other Deferred
Annuities .000025905 (the daily equivalent of an effective annual rate of .95%).
VARIABLE INCOME PAYMENTS
"Variable income payments" include variable income payments made under the
various Income Annuities.
ASSUMED INVESTMENT RATE
The following discussion concerning the amount of variable income payments
is based on an Assumed Investment Rate of 4% per year. It should not be inferred
2
<PAGE>
that such rates will bear any relationship to the actual net investment
experience of the Separate Account.
AMOUNT OF INCOME PAYMENTS
The cash you received periodically from the investment division will depend
upon the payment or Account Balance applied as of the annuity date, the Annuity
Unit Value as of the annuity date, the amount of any premium tax owed, any
contract charges, the annuity type selected, and the age(s) and sex of the
annuitant(s) (except where unisex values rates are required by law).
The first payment is equal to the number of units determined, as explained
above, multiplied by the annuity unit value as of the issue date or as of the
date 10 days prior to payment if later. Subsequent payments are equal to the
number of annuity units multiplied by the annuity unit value 10 days prior to
payment.
Income Annuities contain tables indicating the dollar amount of the first
income payment (if the payment is made as of the issue date of the contract)
under each variable income type for each $1,000 of payment or Account Balance
(after deduction for any premium tax) at various ages. These tables are based
upon 1983 MetLife adjusted group and individual mortality tables and the Assumed
Investment Rate.
The first variable income payment consists of a portion from each of the
Separate Account investment divisions chosen. Each portion of the first payment
is divided by the annuity unit value (described below) for that division to
determine the number of annuity units in each division represented by the
payment. The number of such units will remain fixed during the annuity period,
assuming the annuitant makes no transfers of annuity units to provide annuity
units under another investment division or to provide a fixed income option.
Subsequently, the variable income payment amount will be determined as of
the 10th day prior to a payment due date. Each payment may vary from the prior
one.
Therefore, the dollar amount of variable income payments after the first
will vary with the amount by which the investment performance is greater or less
than 4% per annum and separate account expenses. For example, on an annual
basis, if an investment division has a cumulative investment performance of 6%
over a one year period, the first variable income plan payment in the next year
will be approximately 0.75% greater than the payment on the same date in the
preceding year, and subsequent payments will continue to vary with the
investment experience of the division. If such investment performance return is
- -1% over a one year period, the first variable income payment in the next year
will be approximately 6.25% less than the payment on the same date in the
preceding year, and subsequent payments will continue to vary with the
investment performance of the applicable division.
Each Deferred Annuity provides that, when a pay-out option is chosen, the
payment to the annuitant will not be less than the payment produced by the then
current settlement option rates, which will not be less that the rates used for
a currently issued single payment immediate annuity contract. The purpose of
this provision is to assure the annuitant that, at retirement, if the fixed
income option purchase rates for new single payment immediate contracts are
significantly more favorable than the rates guaranteed by a Deferred Annuity,
the annuitant will be given the benefit of the new rates.
ANNUITY UNIT VALUE
The Annuity Unit Value is calculated at the same time that the Accumulation
Unit Value is calculated and is based on the same change in investment
performance in the Separate Account. (See "The Value of Your Income Payment" on
page A-PPA-30, B-PPA-32, C-PPA-32 and FFA-48 in the Prospectus.)
HOW IS AN ANNUITY UNIT VALUE CALCULATED?
We calculate Annuity Unit Values once a day on every day the New York Stock
Exchange is open for trading. We call the time between two consecutive annuity
unit value calculations the "Valuation Period." We have the right to change the
basis for the Valuation Period, on 30 days' notice, as long as it is consistent
with the law. All purchase payments and transfers are valued as of the end of
the Valuation Period during which the transaction occurred. The annuity unit
values can increase or decrease, based on the investment performance of the
corresponding underlying portfolios. If the investment performance is positive,
after payment of Separate Account expenses and the deduction for the AIR,
Annuity Unit Values will go up. Conversely, if the investment performance is
negative, after payment of Separate Account expenses and the deduction for the
AIR, Annuity Unit Values will go down.
To calculate an Annuity Unit Value, we first multiply the experience factor
for the period by a factor based on the AIR and the number of days in the
Valuation Period. For an AIR of 4% and a one day Valuation Period, the factor is
.99989255, which is the daily discount factor for an effective annual rate of
4%. (The AIR may be in the range of 3% to 6%, as defined in your Income Annuity
and the laws in your state.) The resulting number is then multiplied by the last
previously calculated annuity unit value to produce the new annuity value.
3
<PAGE>
The following illustrations show, by use of hypothetical examples, the
method of determining the annuity unit value and the amount of variable income
payments:
ILLUSTRATION OF CALCULATION OF ANNUITY UNIT VALUE
<TABLE>
<S> <C>
1. Annuity Unit Value, beginning of period........................ $ 10.20000
2. "Experience factor" for period................................. 1.023558
3. Daily adjustment for 4% of Assumed Investment Rate............. .99989255
4. (2) X (3)...................................................... 1.023448
5. Annuity Unit Value, end of period (1) X (4).................... $ 10.43917
</TABLE>
HOW IS A VARIABLE INCOME PAYMENT DETERMINED AND WHAT IS THE AIR?
Variable income payments can go up or down based upon the investment
performance of the investment divisions in the Separate Account. AIR is the rate
used to determine the first variable income payment and serves as a benchmark
against which the investment performance of the investment divisions is
compared. The higher the AIR, the higher the first variable income payment will
be. Subsequent variable income payments will increase only to the extent that
the investment performance of the investment divisions exceeds the AIR (and
Separate Account charges). Variable income payments will decline if the
investment performance of the Separate Account does not exceed the AIR (and
Separate Account charges). A lower AIR will result in a lower initial variable
income payment, but subsequent variable income payments will increase more
rapidly or decline more slowly as changes occur in the investment performance of
the investment divisions.
ILLUSTRATION OF ANNUITY PAYMENTS
(ASSUMES THE FIRST MONTHLY PAYMENT IS MADE WITHIN 10 DAYS OF THE ISSUE DATE OF
THE INCOME ANNUITY)
Annuitant age 65, Life Annuity with 120 Payments Guaranteed
<TABLE>
<S> <C>
1. Number of Accumulation Units as of Annuity Date............... 1,500.00
2. Accumulation Unit Value....................................... $ 11.80000
3. Accumulation Value of Deferred Annuity (1) X (2).............. $17,700.00
4. First monthly income payment per $1,000 of Accumulation
Value........................................................... $ 5.63
5. First monthly income payment (3) X (4) divided by 1,000....... $ 99.65
6. Annuity Unit Value (see Illustration of Calculation of Annuity
Unit Value above as of Annuity Date)............................ $ 10.80000
7. Number of Annuity Units (5) divided by (6).................... 9.22685
8. Assume Annuity Unit Value for the second month equal to (10
days prior to payment).......................................... $ 10.97000
9. Second monthly Annuity Payment (7) X (8)...................... $ 101.22
10. Assume Annuity Unit Value for third month equal to............ $ 10.52684
11. Next monthly Annuity Payment (7) X (10)....................... $ 97.13
</TABLE>
4
<PAGE>
INVESTMENT MANAGEMENT FEES
Each of the currently available Metropolitan Fund Portfolios pays us, the
investment manager of the Metropolitan Fund, an investment management fee. For
providing investment management services to the Lehman Brothers Aggregated Bond
Index, Metlife Stock Index and Russell 2000 Index Portfolios, we receive monthly
compensation from each Portfolio at an annual rate of .25% of the average daily
value of the aggregate net assets of each Portfolio. For providing investment
management services to the Morgan Stanley EAFE Index Portfolio, we receive
monthly compensation from the Portfolio at an annual rate of .30% of the average
daily assets of the aggregate net assets of the Portfolio. For providing
investment management services to the State Street Research Growth Portfolio, we
receive monthly compensation from the Portfolio at an annual rate of .55% of the
average daily value of the aggregate net assets of the Portfolio up to
$500 million, .50% of such assets on the next $500 million and .45% of such
assets on amounts over $1 billion. For providing investment management services
to the State Street Research Income Portfolio, we receive monthly compensation
from the Portfolio at an annual rate of .35% of the average daily value of the
aggregate net assets up to $250 million, .30% of such assets on the next $250
million and .25% of such assets on amounts over $500 million. For providing
investment management services to the State Street Research Diversified
Portfolio, we receive monthly compensation from the Portfolio at an annual rate
of .50% of the average daily value of the aggregate net assets of the Portfolio
up to $500 million, .45% of such assets on the next $500 million and .40% of
such assets on amounts over $1 billion. For providing investment management
services to the State Street Research Aggressive Growth Portfolio, we receive
monthly compensation at an annual rate of .75% of the average daily value of the
aggregate net assets of the Portfolio up to $500 million, .70% of such assets on
the next $500 million and .65% of such assets on amounts over $1 billion. We pay
State Street Research & Management Company, one of our subsidiaries, to provide
us with sub-investment management services for the State Street Research Income,
State Street Research Diversified, State Street Research Growth and State Street
Aggressive Growth Portfolios.
For providing investment management services to the Santander International
Stock Portfolio, we receive monthly compensation from the Portfolio at an annual
rate of .75% of the average daily value of the aggregate net assets of the
Portfolio up to $500 million, .70% of such assets on the next $500 million and
.65% of such assets on amounts over $1 billion. Effective on or about November
9, 1998, Santander Global Advisors, Inc., of which MetLife owns 25% of the
outstanding common stock, became the sub-investment manager for the Santander
International Stock Portfolio.
For providing investment management services to the Loomis Sayles High
Yield Bond Portfolio, we receive monthly compensation from the Portfolio at an
annual rate of .70% of the average daily value of the aggregate net assets of
the Portfolio. Loomis, Sayles & Company, L.P., whose general partner is
indirectly owned by MetLife, is the sub-investment manager with respect to the
Loomis Sayles High Yield Bond Portfolio. For providing investment management
services to the Janus Mid Cap Portfolio, we receive monthly compensation from
the Portfolio at an annual rate of .75% of the average daily value of the
aggregate net assets of the Portfolio up to $100 million, .70% of such assets on
the next $400 million and .65% of such assets on amounts in excess of $500
million. Janus Capital Corporation is the sub-investment manager for the Janus
Mid Cap Portfolio. For providing investment management services to the T. Rowe
Price Small Cap Growth Portfolio, we receive monthly compensation from the
Portfolio at an annual rate of .55% of the average daily value of the aggregate
net assets of the Portfolio up to $100 million, .50% of such assets on the next
$300 million and .45% of such assets in excess of $400 million. For providing
investment management services to the T. Rowe Price Large Cap Growth Portfolio,
we receive monthly compensation from the Portfolio at an annual rate of .70% of
the average daily value of the aggregate net assets of the Portfolio up to
$50 million and .60% of such assets in excess of $50 million. T. Rowe Price
Associates, Inc. is the sub-investment manager for the T. Rowe Price Small Cap
Growth and T. Rowe Price Large Cap Growth Portfolios.
For providing investment management services to the Scudder Global Equity
Portfolio, we receive monthly compensation from the Portfolio at an annual rate
of .90% of the average daily value of the aggregate net assets of the Portfolio
up to $50 million, .55% of such assets on the next $400 million and .475% of
such assets on the next $50 million, .50% of such assets on the next $400
million and .475% of such assets on amounts in excess of $500 million. Scudder
Kemper Investments, Inc. is the sub-investment manager for the Scudder Global
Equity Portfolio.
For providing investment management services to the Harris Oakmark Large
Cap Value Portfolio, we receive monthly compensation from the Portfolio at an
annual rate of .75% of the average daily value of the aggregate net assets of
the Portfolio up to $250 million and .70% of such assets in excess of
$250 million. Harris Associates L.P., whose general partner is indirectly
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owned by MetLife, is the sub-investment manager with respect to the Harris
Oakmark Large Cap Value Portfolio.
For providing investment management services to the Neuberger&Berman
Partners Mid Cap Value Portfolio, we receive monthly compensation from the
Portfolio at an annual rate of .70% of the average daily value of the aggregate
net assets of the Portfolio up to $100 million, .675% of such assets on the next
$250 million, .65% of such assets on the next $500 million, .625% of such assets
on the next $750 million and .60% of such assets over $1.6 billion,
Neuberger&Berman Management Incorporated is the sub-investment manager for the
Neuberger&Berman Partners Mid Cap Value Portfolio.
PERFORMANCE DATA AND ADVERTISEMENT OF THE SEPARATE ACCOUNT
From time to time we advertise the performance of various Separate Account
investment divisions. For the money market investment divisions, this
performance will be stated in terms of "yield" and "effective yield." For the
other investment divisions, this performance will be stated in terms of either
yield, "change in accumulation unit value," "change in annuity unit value" or
"average annual total return" or some combination of the foregoing. Yield,
change in accumulation unit value, change in annuity unit value and average
annual total return figures are based on historical earnings and are not
intended to indicate future performance. The yield of the money market
investment divisions refers to the income generated by an investment in the
division over a seven-day period, which will be specified in the advertisement.
This income is then annualized, by assuming that the same amount of income is
generated each week over a 52 week period, and the total income is shown as a
percentage of the investment. The effective yield is similarly calculated;
however, when annualized, the earned income in the division is assumed to be
reinvested. Thus, the effective yield figure will be slightly higher than the
yield figure because of the former's compounding effect. Other yield figures
quoted in advertisements, that is those other than the money market investment
divisions, will refer to the net income generated by an investment in a
particular division for a thirty-day period or month, which is specified in the
advertisement, and then expressed as a percentage yield of that investment. This
percentage yield is then compounded semiannually. Change in accumulation unit
value or change in annuity unit value refers to the comparison between values of
accumulation or annuity units over specified periods in which an investment
division has been in operation, expressed as a percentage and may also be
expressed as an annualized figure. In addition, change in accumulation unit
value or change in annuity unit value may be used to illustrate performance for
a hypothetical investment (such as $10,000) over the time period specified.
Yield, change in accumulation unit value and effective yield figures do not
reflect the possible imposition of an early withdrawal charge of, for the
Deferred Annuities and certain Enhanced Deferred Annuities, up to 7% of the
amount withdrawn attributable to a purchase payment, which may result in a lower
figure being experienced by the investor. Average annual total return differs
from the change in accumulation unit value and change in annuity unit value
becaue it assumes a steady rate of return and reflects all expenses and
applicable early withdrawal charges. Performance figures will vary among the
various Deferred Annuities and Income Annuities as a result of different
Separate Account charges and early withdrawal charges.
Enhanced Preference Plus, Enhanced VestMet and Financial Freedom Deferred
Annuities and Enhanced Preference Plus and Financial Freedom Account Income
Annuities performance figures vary from other Preference Plus and VestMet
Deferred Annuities and Income Annuities as a result of reduced Separate Account
charges. Performance may be calculated based upon historical performance of the
underlying performance portfolios of the Metropolitan Fund, Calvert Social
Balanced Portfolio, Calvert Social Mid Cap Growth Portfolio, and the Fidelity
VIP and VIPII Funds and may assume that certain deferred annuity were in
existence prior to their inception date. After the inception date, actual
accumulation unit or annuity unit data is used.
Advertisements regarding the Separate Account may contain comparisons of
hypothetical after-tax returns of currently taxable investments versus returns
of tax deferred investments. From time to time, the Separate Account may compare
the performance of its investment divisions with the performance of common
stocks, long-term government bonds, long-term corporate bonds, intermediate-term
government bonds, Treasury Bills, certificates of deposit and savings accounts.
The Separate Account may use the Consumer Price Index in its advertisements as a
measure of inflation for comparison purposes. From time to time, the Separate
Account may advertise its performance ranking among similar investments or
compare its performance to averages as compiled by independent organizations,
such as Lipper Analytical Services, Inc., Morningstar, Inc., VARDS(Registered)
and The Wall Street Journal. The Separate Account may also advertise its
performance in comparison to appropriate indices, such as the Standard & Poor's
500 Composite Stock Price Index, the Standard & Poor's Mid Cap 400 Index, the
Standard & Poor's Small Cap 600 Index, the Russell 2000 Index, the Russell 2000
Growth Index, the Lehman Brothers, Aggregate Bond Index, the Lehman Brothers
Government/Corporate Bond Index, the Merrill Lynch
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High Yield Bond Index, the Morgan Stanley Capital International All Country
World Index and the Morgan Stanley Capital International Europe, Australasia,
Far East Index.
Performance may be shown for certain investment strategies that are made
available under certain Deferred Annuities. The first is the "Equity Generator."
Under the "Equity Generator," an amount equal to the interest earned during a
specified interval (i.e., monthly, quarterly) in the Fixed Interest Account is
transferred to the MetLife Stock Index Division or the State Street Research
Aggressive Growth Division. The second technique is the "EqualizerSM." Under
this strategy, once during a specified period (i.e., monthly, quarterly), a
transfer is made from the MetLife Stock Index Division or the State Street
Research Aggressive Growth Division to the Fixed Interest Account or from the
Fixed Interest Account to the MetLife Stock Index Division or State Street
Research Aggressive Growth Division in order to make the account and the
division equal in value. The third strategy is the "Index SelectorSM". Under
this strategy, once during a specified period (i.e., quarterly, annually)
transfers are made among the Lehman Brothers Aggregate Bond Index, MetLife Stock
Index, Morgan Stanley EAFE Index and Russell 2000 Index. Divisions and the Fixed
Interest Account in order to bring the percentage of the total Account Balance
in each of these divisions and Fixed Interest Account back to the current
allocation of your choice of one of several asset allocation models. The
elements which form the basis of the models are provided by MetLife which may
rely on a third party for its expertise in creating appropriate allocations. The
models are designed to correlate to various risk tolerance levels associated
with investing and are subject to change from time to time.
An "Equity Generator Return," "Aggressive Equity Generator Return,"
"Equalizer Return," "Aggressive Equalizer Return" or "Index Selector Return" for
each asset allocation model will be calculated by presuming a certain dollar
value at the beginning of a period and comparing this dollar value with the
dollar value, based on historical performance, at the end of the period,
expressed as a percentage. The "Return" in each case will assume that no
withdrawals have occurred. We may also show performance for the Equity
Generator, Equalizer and Index Selector investment strategies using other
investment divisions for which these strategies are made available in the
future. If we do so, performance will be calculated in the same manner as
described above, using the appropriate account and/or investment divisions.
VOTING RIGHTS
In accordance with our view of the present applicable law, we will vote the
shares of each of the portfolios held by the Separate Account (which are deemed
attributable to all the Deferred Annuities or Income Annuities described in the
Prospectuses or at regular and special meetings of the shareholders of the
portfolio based on instructions received from those having the voting interest
in corresponding investment divisions of the Separate Account. However, if the
1940 Act or any rules thereunder should be amended or if the present
interpretation thereof should change, and as a result we determine that we are
permitted to vote the shares of the portfolios in our own right, we may elect to
do so.
Accordingly, you have voting interests under all the Deferred Annuities or
Income Annuities described in the Prospectuses. The number of shares held in
each Separate Account investment division deemed attributable to you is
determined by dividing the value of accumulation or annuity units attributable
to you in that investment division, if any, by the net asset value of one share
in the portfolio in which the assets in that Separate Account investment
division are invested. Fractional votes will be counted. The number of shares
for which you have the right to give instructions will be determined as of the
record date for the meeting.
Portfolio shares held in each registered separate account of MetLife or any
affiliate that are or are not attributable to life insurance policies or annuity
deferred annuities (including all the Deferred Annuities and Income Annuities
described in the Prospectuses) and for which no timely instructions are received
will be voted in the same proportion as the shares for which voting instructions
are received by that separate account. Portfolio shares held in the general
accounts or unregistered separate accounts of MetLife or its affiliates will be
voted in the same proportion as the aggregate of (i) the shares for which voting
instructions are received and (ii) the shares that are voted in proportion to
such voting instructions. However, if we or an affiliate determine that we are
permitted to vote any such shares, in our own right, we may elect to do so
subject to the then current interpretation of the 1940 Act or any rules
thereunder.
You will be entitled to give instructions regarding the votes attributable
to your Deferred Annuity or your Income Annuity, in your sole discretion.
Under the Keogh Deferred Annuities and the Enhanced unallocated Keogh
Deferred Annuity, participants may instruct you to give us instructions
regarding shares deemed attributable to their respective contributions. Under
the Keogh Deferred Annuities and
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the Enhanced unallocated Keogh Deferred Annuity, we will provide you with the
number of copies of voting instruction soliciting materials that you may furnish
such materials to participants who may give you voting instructions.
Under Section 457(f) deferred compensation plans, Section 451 deferred fee
arrangements, Section 451 deferred compensation plans, Section 457(e)(11)
severance and death benefit plans and the TSA Deferred Annuities and Income
Annuities under which the Employer retains all rights, we will provide you with
the number of copies of voting instruction soliciting materials that you request
so that you may furnish such materials to participants who may give you voting
instructions. Neither the Separate Account nor MetLife has any duty to inquire
as to the instructions received or your authority to give instructions; thus, as
far as the Separate Account, and any others having voting interests in respect
of the Separate Account are concerned, such instructions are valid and
effective.
You may give instructions regarding, among other things, the election of
the board of directors, ratification of the election of independent auditors,
and the approval of investment and sub-investment managers.
CAN YOUR VOTING INSTRUCTIONS BE DISREGARDED?
Yes. MetLife may disregard voting instructions under the following
circumstances (1) to make or refrain from making any change in the investments
or investment policies for any portfolio if required by any insurance regulatory
authority; (2) to refrain from making any change in the investment policies or
any investment adviser or principal underwriter or any portfolio which may be
initiated by those having voting interests or the Metropolitan Fund's Calvert
Variable Series' or Fidelity VIP or VIPII Funds' boards of directors, provided
MetLife's disapproval of the change is reasonable and, in the case of a change
in investment policies or investment manager, based on a good faith
determination that such change would be contrary to state law or otherwise
inappropriate in light of the portfolio's objective and purposes; or (3) to
enter into or refrain from entering into any advisory agreement or underwriting
Deferred Annuity, if required by any insurance regulatory authority.
In the event that MetLife does disregard voting instructions, a summary of
the action and the reasons for such action will be included in the next
semiannual report.
ERISA
If your plan is subject to ERISA (the Employee Retirement Income Security
Act of 1974) and you are married, the income payments, withdrawal provisions,
and methods of payment of the death benefit under your Deferred Annuity or
Income Annuity may be subject to your spouse's rights as described below.
Generally, the spouse must give qualified consent whenever you elect to:
a. choose income payments other than on a qualified joint and survivor
annuity basis ("QJSA") (one under which we make payments to you during your
lifetime and then make payments reduced by no more than 50% to your spouse
for his or her remaining life, if any); or choose to waive the qualified
pre-retirement survivor annuity benefit ("QPSA") (the benefit payable to
the surviving spouse of a participant who dies with a vested interest in an
accrued retirement benefit under the plan before payment of the benefit has
begun);
b. make certain withdrawals under plans for which a qualified consent
is required;
c. name someone other than the spouse as your beneficiary;
d. use your accrued benefit as security for a loan exceeding $5,000.
Generally, there is no limit to the number of your elections as long as a
qualified consent is given each time. The consent to waive the QJSA must meet
certain requirements, including that it be in writing, that it acknowledges the
identity of the designated beneficiary and the form of benefit selected, dated,
signed by your spouse, witnessed by a notary public or plan representative, and
that it be in a form satisfactory to us. The waiver of a QJSA generally must be
executed during the 90-day period ending on the date on which income payments
are to commence, or the withdrawal or the loan is to be made, as the case may
be. If you die before benefits commence, your surviving spouse will be your
beneficiary unless he or she has given a qualified consent otherwise. The
qualified consent to waive the QPSA benefit and the beneficiary designation must
be made in writing that acknowledges the designated beneficiary, dated, signed
by your spouse, witnessed by a notary public or plan representative and in a
form satisfactory to us. Generally, there is no limit to the number of
beneficiary designations as long as a qualified consent accompanies each
designation. The waiver of and the qualified consent for the QPSA benefit
generally may not be given until the plan year in which you attain age 35. The
waiver period for the QPSA ends on the date of your death.
If the present value of your benefit is worth $5,000 or less, your plan
generally may provide for distribution of your entire interest in a lump sum
without spousal consent.
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TAXES
GENERAL
Federal tax laws are complex and are subject to frequent change as well as
to judicial and administrative interpretation. The following is a general
summary intended to point out what we believe to be some general rules and
principles, and not to give specific tax or legal advice. Failure to comply with
the law may result in significant penalties. For details or for advice on how
the law applies to your individual circumstances, consult your tax advisor or
attorney. You may also get information from the Internal Revenue Service.
In the opinion of our attorneys, the Separate Account and its operations
will be treated as part of MetLife, and not taxed separately. We are taxed as a
life insurance company. Thus, although the Deferred Annuities and Income
Annuities and Enhanced Deferred Annuities and Enhanced Income Annuities allow us
to charge the Separate Account with any taxes or reserves for taxes attributable
to it, we do not expect that under current law we will do so.
HOW DO FEDERAL INCOME TAXES AFFECT YOUR DEFERRED ANNUITY?
The following discussion of the tax code provisions for the Deferred
Annuities includes the Enhanced Annuities subject to the same tax code
provisions.
Generally, all contributions under the Deferred Annuities will be made on a
before tax basis. This does not include contributions under:
o Non-Qualified and Roth IRA Deferred Annuities
And non-deductible contributions under:
o IRA and certain other qualified Deferred Annuities
This means that the purchase payments either reduce your income, entitle
you to a tax deduction or are not subject to current income tax. To the extent
contributions to your Deferred Annuity were not subject to Federal income tax,
withdrawals of these contributions will be subject to Federal income taxes.
Earnings under your Deferred Annuity are generally subject to income tax when
distributed. However, "qualified distributions" of earnings from a Roth IRA are
not subject to Federal income tax.
Contributions to Non-Qualified and Roth IRA Deferred Annuities, as well as
non-deductible contributions to IRA Deferred Annuities are made on an "after-tax
basis", so that making purchase payments does not reduce the taxes you pay.
Earnings under the Non-Qualified Deferred Annuities and IRA Deferred
Annuities, are normally not taxed until withdrawn, if you, as the owner, are an
individual. Thus, that portion of any withdrawal that represents income is taxed
when you receive it, but that portion that represents purchase payments is not,
to the extent previously taxed. For Roth IRA Deferred Annuities, "qualified
distributions" of earnings are not subject to Federal income tax. Withdrawals of
contributions are generally not subject to income tax. However, withdrawal from
a Roth IRA of taxable converted amounts may be subject to a penalty tax if made
before age 59 1/2.
Non-Qualified deferred annuities with an endorsement containing tax
provisions required for Keogh and corporate plans may be issued to Keogh and
corporate plans covering one individual. In such event, contributions under such
deferred annuities will be made on a "before tax" basis and the rules applicable
to Keogh plans will apply to such deferred annuities, notwithstanding any
provision in the deferred annuities to the contrary. Wherever the terms "Keogh
Deferred Annuity" or "Keogh plan" appear in this section, the term shall be
deemed to include non-qualified deferred annuities with an appropriate
endorsement issued to Keogh and corporate plans covering one individual.
Under some circumstances certain of the Deferred Annuities, accept both
purchase payments that entitle you or the owner to a current tax deduction or to
an exclusion from income and those that do not. Taxation of withdrawals depends
on whether or not you or the owner were entitled to deduct or exclude the
purchase payments from income in compliance with the Code.
The taxable portion of a distribution from a Keogh, Enhanced unallocated
Keogh, 403(a) and TSA Deferred Annuity to the participant or the participant's
spouse (if she/he is the beneficiary) that is an "eligible rollover
distribution," as defined in the Code, is subject to 20% mandatory Federal
income tax withholding unless the participant directs the trustee, insurer or
custodian of the plan to transfer all or any portion of his/her taxable interest
in such plan to the trustee, insurer or custodian of (1) an individual
retirement arrangement under Section 408; (2) a qualified trust or 403(a)
annuity plan, if the distribution is from a Keogh, Enhanced unallocated Keogh,
or 403(a) Deferred Annuity; or (3) a TSA, if the distribution is from a TSA
Deferred Annuity. An eligible rollover distribution generally is the taxable
portion of any distribution from a Keogh, Enhanced unallocated Keogh, 403(a) or
TSA Deferred Annuity, except the following: (a) a series of substantially equal
periodic payments over the life (or life expectancy) of the participant; (b) a
series of substantially equal periodic payments over the lives (or joint life
expectancies) of the participant and his/her beneficiary; (c) a series of
substantially equal periodic payments over a specified period of at least ten
years;
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(d) a minimum distribution required during the participant's lifetime or the
minimum amount to be paid after the participant's death; (e) refunds of excess
contributions to the plan described in Section 401(k) of the Code for
corporations and unincorporated businesses; (f) certain loans treated as
distributions under the Code; (g) the cost of life insurance coverage which is
includible in the gross income of the plan participant; and (h) any other
taxable distributions from any of these plans which are not eligible rollover
distributions.
The IRA Deferred Annuities accept both purchase payments that entitle you
or the owner to a current tax deduction or to an exclusion from income and those
that do not. Taxation of withdrawals depends on whether or not you or the owner
were entitled to deduct or exclude the purchase payments from income in
compliance with the Code. Roth IRA deferred annuities only accept "after-tax"
contributions.
All taxable distributions from Keogh, Enhanced unallocated Keogh, 403(a)
and TSA Deferred Annuities that are not eligible rollover distributions and all
taxable distributions from IRAs and Non-Qualified Deferred Annuities will be
subject to Federal income tax withholding, unless the payee elects to have no
withholding. The rate of withholding is as determined by the Code and
Regulations thereunder at the time of payment. All taxable distributions from
the PEDC Deferred Annuity will be subject to the same Federal income tax
withholding as regular wages.
Each type of Deferred Annuity is subject to various tax limitations.
Typically, except for the Non-Qualified Deferred Annuities the maximum amount of
purchase payment is limited under Federal tax law and there are limitations on
how long money can be left under the Deferred Annuities before withdrawals must
begin. A 10% tax penalty applies to certain taxable withdrawals from the
Deferred Annuity (or in some cases from the plan or arrangement that purchased
the Deferred Annuity) before you are age 59 1/2. Under a SIMPLE IRA, the tax
penalty is increased to 25% for withdrawals during the first two years of an
employee's participation in the SIMPLE IRA.
The rules as to what payments are subject to this provision are complex.
The following paragraphs will briefly summarize some of the federal tax rules on
a Deferred Annuity-by-Deferred Annuity basis, but will make no attempt to
mention or explain every single rule that may be relevant to you. We are not
responsible for determining if your plan or arrangement satisfies the
requirements of the Code.
Traditional IRA and Enhanced IRA Deferred Annuities. The tax rules
outlined in this section for both Traditional IRA and Enhanced IRA Deferred
Annuities are the same. Annual contributions to all Traditional and Roth IRAs
may not exceed the lesser of $2,000 or 100% of your "compensation" as defined by
the Code, except "spousal IRAs" discussed in the next paragraph. Generally, no
contributions are allowed during or after the tax year in which you attain age
70 1/2. Contributions other than those allowed are subject to a 6% excess
contribution tax penalty. Special rules apply to withdrawals of excess
contributions. These dollar and age limits do not apply to tax-free "rollovers"
or transfers from other IRAs or from other tax-favored plans that the Code
allows.
Annual contributions are generally deductible up to the above limits if
neither you nor your spouse was an "active participant" in another qualified
retirement plan during the taxable year. You will not be treated as married for
these purposes if you lived apart for the entire taxable year and file separate
returns. For 1999, if you are an "active participant" in another retirement plan
and if your adjusted gross income is $31,000 or less ($51,000 for married
couples filing jointly, however, never fully deductible for a married person
filing separately), annual contributions are fully deductible. However,
contributions are not deductible if your adjusted gross income is over $41,000
($61,000 for married couples filing jointly, $10,000 for a married person filing
separately). If your adjusted gross income falls between these amounts, your
maximum deduction will be phased out. For an individual who is not an "active
participant" but whose spouse is, the adjusted gross income limits for the
nonactive participant spouse is $150,000 for a full deduction (with a phase-out
between $150,000 and $160,000). If you file a joint return and you and your
spouse are under age 70 1/2, you and your spouse may be able to make annual IRA
contributions of up to $4,000 ($2,000 each) to two IRAs, one in your name and
one in your spouse's. Neither can exceed $2,000, nor can it exceed your joint
compensation.
Taxable withdrawals (other than tax-free transfers or "rollovers" to other
individual retirement arrangements) before age 59 1/2 are subject to a 10% tax
penalty. This penalty does not apply to withdrawals (1) paid to a beneficiary or
your estate after your death; (2) due to your permanent disability (as defined
in the Code); (3) made in substantially equal periodic payments (not less
frequently than annually) over the life or life expectancy of you or you and
another person named by you as your beneficiary; (4) to pay deductible medical
expense; (5) to enable certain unemployed persons to pay medical insurance
premiums; (6) made after December 31, 1997 to pay for qualified higher education
expenses; or (7) made after December 31, 1997 for qualified first time home
purchases. If you are under age 59 1/2 and are receiving Systematic Withdrawal
Program payments that you intend to qualify as a series of substantially equal
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periodic payments under Section 72(t) of the Code and thus not subject to the
10% tax penalty, any modifications to your Systematic Withdrawal Program
payments before age 59 1/2 or five years after beginning Systematic Withdrawal
Program payments will result in the retroactive imposition of the 10% tax
penalty. You should consult with your tax adviser to determine whether you are
eligible to rely on any exceptions to the 10% tax penalty before you elect to
receive any Systematic Withdrawal Program payments or make any modifications to
your Systematic Withdrawal Program payments.
If you made both deductible and non-deductible contributions, a partial
withdrawal will be treated as a pro rata withdrawal of both, based on all of
your IRAs (not just the IRA Deferred Annuities). The portion of the withdrawal
attributable to non-deductible contributions (but not the earnings on them) is a
nontaxable return of principal, and the 10% tax penalty does not apply. You must
keep track of which contributions were deductible and which weren't, and make
annual reports to the IRS if non-deductible contributions were made.
Withdrawals may be transferred to another IRA without Federal tax
consequences if Code requirements are met. Your Deferred Annuity is not
forfeitable and you may not transfer it.
Your entire interest in the Deferred Annuity must be with-drawn or begun to
be withdrawn generally by April 1 of the calendar year following the year in
which you reach age 70 1/2 and a tax penalty of 50% applies to withdrawals which
should have been made but were not. Complex rules apply to the timing and
calculation of these withdrawals. Other complex rules apply to how rapidly
withdrawals must be made after your death. Generally, if you die before the
required withdrawals have begun, we must make payments of your entire interest
within five years of the year in which you died or begin payments under an
income annuity allowed by the Code to your beneficiary over his or her lifetime
or over a period not beyond your beneficiary's life expectancy starting by the
December 31 of the year following the year in which you die. If your spouse is
your beneficiary, and, if your Deferred Annuity permits, payments may be made
over your spouse's lifetime or over a period not beyond your spouse's life
expectancy starting by the December 31 of the year in which you would have
reached age 70 1/2, if later. If your beneficiary is your spouse, he or she may
elect to continue the Deferred Annuity as his or her own IRA Deferred Annuity
after your death. If you die after the required withdrawal has begun, payments
must continue to be made at least as rapidly as under the method of distribution
that was used as of the date of your death. The IRS allows you to aggregate the
amount required to be withdrawn from each individual retirement arrangement you
own and to withdraw this amount in total from any one or more of the individual
retirement arrangements you own.
If you satisfy certain requirements, you can change your Traditional IRA
contribution to a Roth IRA if you "recharacterize" your contribution before you
file your income tax return (including filing extensions).
Roth IRA Deferred Annuities. Annual contributions to all Traditional and
Roth IRAs may not exceed the lesser of $2,000 or 100% of your "compensation."
You may contribute up to the annual contribution limit to a Roth IRA in 1998 if
your adjusted gross income is not in excess of $95,000 ($150,000 for married
couples filing jointly). The contribution limits to a Roth IRA are phased out
ratably for individuals with income between $95,000 and $110,000 and for married
couples filing jointly with income between $150,000 and $160,000; and for
married couples filing separately between $0 and $10,000. Annual contributions
to all IRAs, including Roth IRAs, may not exceed the lesser of $2,000 or 100% of
your "compensation" as defined by the Code, except for "spousal IRAs." These
limits on annual contributions do not apply to a rollover from a Roth IRA to
another Roth IRA or a conversion from an existing IRA to a Roth IRA. You may
make contributions to a Roth IRA after age 70 1/2. Excess contributions are
subject to a 6% excess contribution tax penalty. Special rules apply to
withdrawals of excess contributions.
You may convert/rollover an existing IRA to a Roth IRA if your adjusted
gross income does not exceed $100,000 in the year you convert. If you are
married but file separately, you may not convert a non-Roth IRA into a Roth IRA.
Except to the extent you have non-deductible IRA contributions, the amount
converted from a non-Roth IRA into a Roth IRA is taxable. Generally, the 10%
early withdrawal penalty does not apply to conversions/ rollovers. (See
exception discussed below.) For conversions occurring in 1998, the taxable
amount will be included ratably in income over a four year period beginning in
1998, unless you elect otherwise.
Distributions from a Roth IRA are made first from contributions and then
from earnings. Generally, withdrawals from contributions are not subject to tax.
However, withdrawals of taxable converted amounts prior to age 59 1/2 and made
within five taxable years from such conversion will be subject to the 10%
premature penalty tax (unless you meet an exception). In addition, withdrawals
in 1998, 1999 or 2000 of converted amounts that have received four year income
inclusion treatment will be included in income in the year of the withdrawal (in
addition to the amounts to be included under the four year income inclusion
election). The total aggregate
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amount to be included in income shall not exceed the total taxable amount of the
conversion.
Withdrawals of earnings will not be subject to Federal income tax if they
are "qualified distributions." In order to be a qualified distribution, the
withdrawal must be: (a) made at least five taxable years from the year you
established a Roth IRA, and (b) made after age 59 1/2, or for death, disability,
or a first-time home purchase (up to $10,000). (Please consult your tax advisor
regarding the state income tax treatment of your withdrawal.)
The withdrawal of earnings not meeting the foregoing requirements will be
subject to income tax and possibly the 10% premature tax penalty.
Mandatory minimum distribution rules do not apply while you are alive.
Generally, when you die, we must make payment of your entire interest within
five years of the year in which you died or begin payments under an income
annuity allowed by the Code to your beneficiary over his/her lifetime or over a
period not beyond your beneficiary's life or life expectancy starting by
December 31 of the year following the year in which you die.
Since the Roth IRA was signed into the tax law in August, 1997, and many
aspects of the law have yet to be clarified, you should consult your tax advisor
regarding developments concerning the tax treatment of Roth IRAs and the
appropriateness of the Roth IRA to your particular situation.
If you satisfy certain requirements, you can change your Traditional IRA
contribution to a Roth IRA if you "recharacterize" your contribution before you
file your income tax return (including filing extensions).
SEP Deferred Annuities. Partners and sole proprietors may make purchase
payments under SEPs for themselves and their employees, and corporations may
make purchase payments under SEPs for their employees. Complex rules apply to
which employees or other persons must be allowed to participate, and what
contributions may be made for each of them. Once a contribution is made, you
(not the employer) have all rights to it. Once contributions are made (under
these SEP rules), your SEP generally operates as if it were an IRA purchased by
you under the IRA rules discussed above. An employer is not permitted to
establish a salary reduction SEP plan ("SARSEP") after December 31, 1996.
However, you may make contributions, in accordance with your plan's provisions,
to your existing SARSEP contract if your employer's SARSEP plan was established
prior to January 1, 1997.
SIMPLE IRAs. If an employer has no more than 100 employees (who earn at
least $5,000) and the SIMPLE IRA is the exclusive tax-qualified plan of the
employer, employees may make contributions on a before-tax basis of up to $6,000
(subject to indexing) and the employer must generally match employee
contributions dollar-for-dollar up to 3% of compensation. Under certain
circumstances, the employer can elect to make a lesser matching contribution or
make a contribution equal to 2% of compensation for all eligible employees.
SIMPLE IRAs are exempt from complex nondiscrimination, top-heavy and reporting
rules. Once a contribution is made, you (not the employer) have all rights to
it. Once contributions are made under these SIMPLE IRA rules, your SIMPLE IRA
generally operates as if it were an IRA purchased by you under the IRA rules
discussed above. (However, the tax penalty for early withdrawals is generally
increased for withdrawals within the first two years of an employee's
participating in the SIMPLE IRA.)
PEDC Deferred Annuity. PEDC plans are available to State or local
governments and certain tax-exempt organizations as described in Section 457 of
the Code. These plans, which must meet the requirements of Section 457(b),
provided certain tax deferral benefits to employees and independent contractors.
These plans are not available to churches and qualified church-controlled
organiz-ations. A PEDC plan maintained by a State or local government must be
held in trust (or custodial account or annuity contract) for the exclusive
benefit of plan participants and their beneficiaries. However, for state or
local government plans in existence on August 20, 1996 these requirements do not
have to be met prior to January 1, 1999. Plan benefit deferrals, contributions
and all income attributable to such amounts under PEDC plans, other than those
maintained by a State or local government as described above, are (until made
available to the participant or other beneficiary) solely the property of the
employer, subject to the claims of the employer's general creditors.
The compensation amounts that may be deferred under a PEDC plan may not
exceed certain deferral limits established under the Federal tax law. In
addition, contributions to other plans may reduce the deferral limit even
further.
Under the plan, amounts will not be made available to participants or
beneficiaries until the earliest of (1) the calendar year in which the
participant reaches age 70 1/2, (2) when the participant separates from service
with the employer, or (3) when the participant is faced with an unforeseeable
emergency as described in the income tax regulations. Amounts will not be
treated as "made available" under these rules if (i) an election to defer
commencement of a distribution is made by the participant and such election
meets certain requirements, or (ii) the total amount payable is $5,000 or less
and certain other requirements are met.
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Withdrawals must conform to the complex minimum distribution requirements
of the Code, including the requirement that distributions must generally begin
no later than April 1 of the calendar year following the later of: the year in
which the participant attains age 70 1/2 or, to the extent permitted under your
plan or contract, the year the participant retires. Although the minimum
distribution rules are similar to the rules summarized above for TSAs there are
some differences. For example, for PEDC plans, any distribution payable over a
period of more than one year can only be made in substantially non-increasing
amounts, and generally distributions may not exceed 15 years.
Special rules apply to certain non-governmental PEDC plans deferring
compensation from taxable years beginning before January 1, 1987 (or beginning
later but based on an agreement in writing on August 16, 1986 and which then
provided for deferral of fixed amounts or amounts determined by a fixed
formula).
403(a) Deferred Annuities. The employer adopts a 403(a) plan as a
qualified retirement plan to provide benefits to participating employees. The
plan generally works in a similar manner to a corporate qualified retirement
plan except that the 403(a) plan does not have a trust or a trustee.
The Code limits the amount of contributions and distributions that may be
made under 403(a) plans. Taxable withdrawals before age 59 1/2 may be subject to
a 10% tax penalty. Any amounts distributed under the 403(a) Deferred Annuities
are generally taxed according to the rules described under Section 72 of the
Code. Under rules similar to those described above for TSAs, for taxable years
after 1996, if you do not have a 5% or more ownership interest in your employer,
withdrawals of your entire interest under the Deferred Annuity must be made or
begun to be made no later than the April 1 of the calendar year following the
later of: the year in which you reach age 70 1/2 or, to the extent permitted
under your plan or contract, the year you retire. Also, if you die before
required withdrawals have begun, the entire interest in the plan generally must
be paid within five years of the year in which you died. The minimum
distribution rules for 403(a) Deferred Annuities are similar to those rules
summarized for TSAs.
Keogh Deferred Annuities. Pension and profit-sharing plans satisfying
certain Code provisions are considered to be "Keogh" plans. Complex rules apply
to the establishment and operation of such plans, including the amounts that may
be contributed under them. Excess contributions are subject to a 10% penalty.
Special rules apply to the withdrawal of excess contributions.
Taxable withdrawals before age 59 1/2 are subject to a 10% tax penalty
(this does not apply to the return of any non-deductible purchase payments).
This penalty does not apply to withdrawals (1) paid to a beneficiary or your
estate after your death; (2) due to your permanent disability (as defined in the
Code); (3) made in substantially equal periodic payments (not less frequently
than annually) over the life or life expectancy of you or you and another person
named by you as your beneficiary where such payments begin after separation from
service; (4) made to you after you separate from service with your employer
after age 55; or (5) made to you on account of deductible medical expenses
(whether or not you actually itemize deductions).
Under rules similar to those described above for TSAs, for taxable years
after 1996, if you do not have a 5% or more ownership interest in your Employer,
withdrawals of your entire interest under the deferred annuities must be made or
begun to be made beginning no later than the April 1 of the calendar year
following the later of: the year in which you reach age 70 1/2 or, to the extent
permitted under your plan or deferred annuities, the year you retire. Also, if
you die before required withdrawals have begun, the entire interest in the
Deferred Annuity generally must be paid within five years of the year in which
you died.
If your benefit under the Keogh plan is worth more than $5,000, the Code
requires that your income annuity protect your spouse if you die before you
receive any payments under the annuity or if you die while payments are being
made. You may waive these requirements with the written consent of your spouse.
Designating a beneficiary other than your spouse is considered a waiver. Waiving
these requirements may cause your monthly benefit to increase during your
lifetime.
Non-Qualified deferred annuities with an endorsement containing tax
provisions required for Keogh and corporate plans may be issued to Keogh and
corporate plans covering one individual. In such event, the rules applicable to
Keogh plans as outlined above will apply to such deferred annuities,
notwithstanding any provision in the deferred annuities to the contrary.
Enhanced Unallocated Keogh Deferred Annuity. Pension and profit-sharing
plans satisfying certain Code provisions are considered to be "Keogh" plans.
Complex rules apply to the establishment and operation of such plans, including
the amounts that may contributed under them. Excess contributions are subect to
a 10% penalty. Special rules apply to the withdrawal of excess contributions.
Taxable withdrawals before age 59 1/2 are subject to a 10% tax penalty
(this does not apply to the return of any non-deductible purchase payments).
This penalty does not apply to withdrawals (1) paid to a beneficiary or your
estate after your death; (2) due to your permanent
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disability (as defined in the Code); (3) made in substantially equal periodic
payments (not less frequently than annually) over the life of life expectancy of
you or you and another person named by you where such payments begin after
separation from service; (4) made to you after you separate from service with
your employer after age 55; or (5) made to you on account of deductible medical
expenses (whether or not you actually itemize deductions).
Withdrawals may be transferred to another qualified trust or a 403(a)
annuity plan or (for eligible rollover distributions) to an IRA without Federal
tax consequences if Code requirements are met. Your deferred annuity is not
forfeitable and you may not transfer it. Generally, for taxable years after
1996, if you do not have a 5% or more ownership interest in your employer, your
entire interest in the deferred annuity must be withdrawn or begin to be
withdrawn by April 1 of the calendar year following the later of: the year in
which you reach age 70 1/2 or, to the extent permitted under your plan or
deferred annuity, the year in which you retire. A tax penalty of 50% applies to
withdrawals which should have been made but were not. Complex rules apply to the
timing and calculation of these withdrawals. Other complex rules apply to how
rapidly withdrawals must be made after your death. Generally, if you die before
the required withdrawals have begun, we must make payment of your entire
interest under the deferred annuity within five years of the year in which you
died or begin payments under an income annuity allowed by the Code to your
beneficiary over his or her lifetime or over a period not beyond your
beneficiary's life expectancy starting by the December 31 of the year following
the year in which you die. If your spouse is your beneficiary, payments may be
made over your spouse's lifetime or over a period not beyond your spouse's life
expectancy starting by the December 31 of the year in which you would have
reached age 70 1/2, if later. If you die after income payments begin, payments
must continue to be made at least as rapidly as under the method of distribution
that was used as of the date of your death.
If your benefit under the Keogh plan is worth more than $5,000, the Code
requires that your income annuity protect your spouse if you die before you
receive any payments under the annuity or if you die while payments are being
made. You may waive these requirements with the written consent of your spouse.
Designating a beneficiary other than your spouse is considered a waiver. Waiving
these requirements may cause your monthly benefit to increase during your
lifetime.
TSA Deferred Annuities. These fall under Section 403(b) of the Code that
provides certain tax benefits to eligible employees of public school systems and
organizations that are tax exempt under Section 501(c)(3) of the Code.
Except for the TSA Deferred Annuity under which the employer retains all
rights, your employer buys the Deferred Annuityfor you although you, as the
participant, then own it. The Code limits the amount of purchase payments that
can be made. Purchase payments over this amount may be subject to adverse tax
consequences. Special rules apply to the withdrawal of excess contributions.
Withdrawals before age 59 1/2 are prohibited except for (a) amounts contributed
to or earned under your Section 403(b) arrangement before January 1, 1989 that
were either paid into or earned under the Deferred Annuity or later transferred
to it in a manner satisfying applicable Code requirements (withdrawals are
deemed to come first from pre-1989 money that is not subject to these
restrictions, until all of such money is withdrawn); (b) tax-free transfers to
other Section 403(b) funding vehicles or any other withdrawals that are not
"distributions" under the Code; (c) amounts that are not attributable to salary
reduction elective deferral contributions (i.e., generally amounts not
attributable to a participant's pre-tax contributions and their earnings);
(d) after a participant dies, separates from service or becomes disabled (as
defined in Code); (e) in the case of financial hardship (as defined in the Code)
but only purchase payments may be withdrawn for hardship, not earnings; or
(f) under any other circumstances as the Code allows. Speical withdrawal
restrictions under Section 403(b)(7)(A)(ii) of the Code apply to amounts that
had once been invested in mutual funds custodial arrangements even after such
amounts are transferred to a Deferred Annuity.
Taxable withdrawals (other than tax-free transfers) that are allowed before
age 59 1/2 are subject to an additional 10% tax penalty on the taxable portion
of the withdrawal. This penalty does not apply to withdrawls (1) paid to a
beneficaiary or participant's estate after the participant's death; (2) due to
permanent disability (as defined in the Code); (3) made in substantially equal
periodic payments (not less frequently than annually) over the life or life
expectancy of the participant or the participant and another person named by the
participant where such payments begin after separation from service; (4) made to
the participant after the participant separates from service with the employer
after age 55; (5) made to the participant on account of deductible medical
expenses (whether or not the participant actually itemizes deductions);
(6) made to an "alternate payee" under a "qualified domestic relations order"
(normally a spouse or ex-spouse); (7) of excess matching employer contributions
made to eliminate discrimination under the Code; or (8) timely made to reduce an
elective deferal as allowed by the Code. If you are under age 59 1/2 and are
receiving Systematic Withdrawal Program payments that you intend to qualify as a
series of substantially equal periodic payments under Section 72(t) of the Code
and thus not
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be subject to the 10% tax penalty, any modifications to your Systematic
Withdrawal Program payments before age 59 1/2 or five years after beginning
Systematic Withdrawal Program payments will result in the retrocative imposition
of the 10% tax penalty. You should consult with your tax adviser to determine
whether you are eligible to rely on any exceptions to the 10% tax penalty before
you elect to receive any Systematic Withdrawal Program payments or make any
modifications to your Systematic Withdrawal Program payment.
Withdrawals may be transferred to another Section 403(b) funding vehicle or
(for eligible rollover distributions) to an IRA without federal tax consequences
if Code requirements are met. The Deferred Annuity is not forfeitable and may
not be transferred. Generally, for taxable years after 1996, if you do not have
a 5% or more ownership interest in your employer, your entire interest in the
Deferred Annuity must be withdrawn or begun to be withdrawn by April 1 of the
calendar year following the later of: the year in which the participant reaches
age 70 1/2 or, to the extent permitted under your plan or contract, the year in
which the participant retires. A tax penalty of 50% applies to withdrawals which
should have been made but were not. Complex rules apply to the timing and
calculation of these withdrawals. Other complex rules apply to how rapidly
withdrawals must be made after the participant's death. Generally, if the
participant dies before the required withdrawals have begun, we must make
payment of your entire interest under the Deferred Annuity within five years of
the year in which the participant died or begin payments under an income annuity
allowed by the Code to the participant's beneficiary over his or her lifetime or
over a period not beyond the beneficiary's life expectancy starting by the
December 31 following the year in which the participant dies. If the
participant's spouse is the beneficiary, payments may be made over the spouse's
lifetime or over a period not beyond the spouse's life expectancy starting by
December 31 of the year in which the participant would have reached age 70 1/2,
if later. If the participant dies after required withdrawals have begun,
payments must continue to be made at least as rapidly as under the method of
distribution that was used as of the date of the death of the participant. If
the Deferred Annuity is subject to the Retirement Equity Act, the participant's
spouse has certain rights which may be waived with the written consent of the
spouse. The IRS allows you to aggregate the amount to be withdrawn from each TSA
Deferred Annuity you own and to withdraw this amount in total from any one or
more of the TSA Deferred Annuities you own.
Non-Qualified Deferred Annuity for Section 457(f) Deferred Compensation
Plans. These are deferred compensation agreements generally for a select group
of management or highly compensated employees and individual independent
contractors employed or engaged by State or local governments or non-church
tax-exempt organizations. In this arrangement, the tax-exempt entity (e.g., a
hospital) deposits your deferred compensation amounts and earnings credited to
these amounts into a trust, which at all times is subject to the claims of the
employer's bankruptcy and insolvency creditors. The trust owns a Non-Qualified
Deferred Annuity which may be subject to the Non-Qualified Deferred Annuity
rules described below. Since the trust is a grantor trust, any tax consequences
arising out of ownership of the Non-Qualified Deferred Annuity will flow to the
tax-exempt entity that is the grantor of such trust. Each tax-exempt entity
should consult its own tax advisor with respect to the tax rules governing the
Deferred Annuity. You can defer taxation of compensation until the first taxable
year in which there is not a substantial risk of forfeiture to your right to
such compensation.
Any amount made available under the plan to you or your beneficiary is
generally taxed according to the annuity rules under Section 72. Thus, when
deferred compensation is no longer subject to a substantial risk of forfeiture,
it is immediately includable in your income and it becomes "after-tax"
contributions for the purposes of the tax rules governing income plan payments
in calculating the "exclusion ratio." Certain distributions made before you are
age 59 1/2 may be subject to a 10% tax penalty. It is unclear whether this
penalty applies with respect to distributions made for this type of plan. Thus,
you should consult your own tax advisor to clarify this issue. Since there is
some uncertainty as to how the Internal Revenue Service and courts will treat
the "rolling vesting" aspect of this arrangement, you should consult your own
tax advisor to clarify this issue.
Given the complexity and uncertainty inherent in this area of the tax law,
entities considering the purchase of this Deferred Annuity to fund a
Section 457(f) deferred compensation plan should consult with their own tax
advisors regarding the application of the relevant rules to their particular
situation. In connection with the sale of the Non-Qualified Deferred Annuity for
Section 457(f) Deferred Compensation Plans, MetLife consulted special tax
counsel regarding the major Federal tax issues under Section 457. This advice
from such counsel has not been updated to reflect changes, if any, in the law
and such advice was rendered solely to MetLife and may not be relied upon by any
person considering the purchase of the Deferred Annuity.
Non-Qualified Deferred Annuity for Section 451 Deferred Fee
Arrangements. Under a Section 451 deferred fee arrangement, a third party which
is tax-exempt entity (e.g., a hospital) enters into a deferred fee arrangement
with a taxable entity, the employer, that provides services
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to the third party. These deferred fees are used to fund a deferred compensation
plan for the taxable entity's employees who are a select group of management or
highly compensated employees or individual independent contractors. The deferred
fees are contributed by the tax-exempt entity into a trust that is subject to
the claims of its bankruptcy and insolvency creditors, and, when paid or made
available to the taxable entity, are subject to the claims of the taxable
entity's bankruptcy and insolvency creditors. Such arrangement, in accordance
with the provisions of Section 451, enables the taxable entity to defer
compensation until the year in which the amounts are paid or made available to
it, and enables the employees of the taxable entity who are participants in its
deferred compensation plan to defer compensation until the year in which the
amounts are paid or made available to them, unless under the method of
accounting used in computing taxable income, such amount is to be properly
accounted for in a different period. The taxable entity will be able to deduct
as employee compensation the amounts included in income by the
participant-employees of its deferred compensation plan, subject to such sums
being reasonable compensation and not disguised dividends.
A trust established by the tax-exempt entity will own a Non-Qualified
Deferred Annuity which may be subject to taxation rules as described below under
Non-Qualified Deferred Annuities. Since the trust is a grantor trust, any tax
consequences arising out of ownership of the Non-Qualified Deferred Annuity will
flow to the tax-exempt entity that is the grantor of such trust. Each tax-exempt
entity should consult its own tax advisor with respect to the tax rules
governing the Deferred Annuity. Participants in the taxable entity's deferred
compensation plan must look to the taxable entity for payments under the plan.
These persons should consult their own tax advisor for information on the tax
treatment of these payments made under the plan.
Given the complexity and uncertainty inherent in this area of the tax law,
entities considering the purchase of this Deferred Annuity to fund a Section 451
deferred fee arrangement should consult with their own tax advisors regarding
the application of the relevant rules to their particular situation. In
connection with the sale of the Non-Qualified Deferred Annuity for Section 451
Deferred Fee Arrangements, MetLife consulted special tax counsel regarding the
major Federal tax issues under Section 451. This advice from such counsel has
not been updated to reflect changes, if any in the law and such advice was
rendered solely to MetLife and may not be relied upon by any person considering
the purchase of the Deferred Annuity.
Non-Qualified Deferred Annuity for Section 451 Deferred Compensation
Plans. Under a Section 451 deferred compensation plan, a select group of
management or highly compensated employees or individual independent contractors
can defer compensation until the year in which the amounts are paid or made
available to them, unless under the method of accounting used in computing
taxable income such amount is to be properly accounted for in a different
period. Participants should consult their own tax advisors for information on
the tax treatment of these payments.
A Section 451 plan could be sponsored by either a taxable entity or certain
tax-exempt entities which meet the "grandfather" requirements described below.
Taxable entities would be able to deduct as compensation the amounts included in
income by the participant of the deferred compensation plan, subject to such
sums being reasonable compensation and not disguised dividends. For tax-exempt
entities, if certain Tax Reform Act of 1986 "grandfather" requirements are
adhered to, Section 451 rather than Section 457 should apply to their deferred
compensation plans. Tax-exempt entities should consult their own tax advisors to
ascertain whether these "grandfather" requirements are met.
A trust established by either the taxable or the grandfathered tax-exempt
entity would own a Non-Qualified Deferred Annuity which may be subject to
taxation rules as described below under "Non-Qualified Deferred Annuities".
Since the trust would be a grantor trust, any tax consequences arising out of
ownership of the Non-Qualified Deferred Annuity will flow to the tax-exempt
entity or taxable entity that is the grantor of such trust. Such entities should
consult their own tax advisors with respect to the tax rules governing the
Deferred Annuity.
Given the complexity and uncertainty inherent in this area of the tax law,
entities considering the purchase of this Deferred Annuity to fund a Section 451
deferred compensation plan should consult with their own tax advisors regarding
the application of the relevant rules to their particular situation. In
connection with the sale of the Non-Qualified Deferred Annuity for Section 451
Deferred Compensation Plans, MetLife consulted special tax counsel regarding the
major Federal tax issues under Section 451. This advice from such counsel has
not been updated to reflect changes, if any, in the law and such advice was
rendered solely to MetLife and may not be relied upon by any person considering
the purchase of the Deferred Annuity.
Non-Qualified Deferred Annuity for Section 457(e)(11) Severance and Death
Benefit Plans. These are severance and death benefit arrangements for adoption
by tax-exempt entities. If the employer is subject to ERISA, the arrangement
must be adopted exclusively for a select group of management or highly
compensated employees or individual independent contractors. The employer
deposits deferral amounts, which will be used
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to provide severance and death benefits, into a trust which is subject at all
times to the claims of the employer's bankruptcy and insolvency creditors. As
the owner of a Non-Qualified Deferred Annuity, the trust may be subject to the
rules described below under Non-Qualified Deferred Annuities. Since the trust is
a grantor trust, any tax consequences arising out of ownership of the
Non-Qualified Deferred Annuity will flow to the employer, the grantor of such
trust. Each employer should consult with its own tax advisor with respect to the
tax rules governing the Deferred Annuity.
The Federal income tax consequences to you of this arrangement depend on
whether the program qualifies as a "bona-fide severance pay" and a "bona-fide
death benefit" plan as described in Section 457(e)(11) of the Code. If the
arrangement qualifies as a "bona-fide severance pay" and "bona-fide death
benefit" plan, Section 451 of the Code will apply and you will not be taxed on
your deferral amounts until the tax year in which they are paid or made
available to you, unless under the method of accounting you use in computing
taxable income such amount is to be properly accounted for in a different
period. If the arrangement does not qualify as a "bona-fide severance pay" and
"bona-fide death benefit" plan, your deferral amounts will be subject to tax in
the year in which they are deferred. In that event, if you have not reported
such income, in addition to the Federal income tax you will have to pay, you
will be assessed interest, and you may be subject to certain penalties by the
Internal Revenue Service.
Special Tax Considerations for Non-Qualified Deferred Annuity for
Section 457(e)(11) Severance and Death Benefit Plans. There is a considerable
risk that this arrangement may not qualify as a "bona-fide severance pay" plan
under Section 457(e)(11), the applicable section of the Code. The term
"bona-fide severance pay" plan is not defined in that section. The term
"severance pay" plan has, however, been construed under other Code sections and
under Department of Labor regulations issued under the Employee Retirement
Income Security Act of 1974. In connection with the sale of the Non-Qualified
Deferred Annuity for Section 457(e)(11) Severance and Death Benefit Plans,
MetLife consulted special tax counsel regarding the major Federal tax issues
under Section 457. Subsequently, the United States Court of Appeals for the
Federal Circuit indicated that for purposes of another Code section,
a severance pay plan with features similar to this arrangement would not qualify
as a valid severance pay plan. While this decision addresses severance pay plans
in a different Code context, it is probable that a court would consider it in
determining the tax consequences of this arrangement. This advice received from
such counsel has not been updated to reflect this decision or other changes in
the law, and such advice was rendered solely to MetLife and may not be relied
upon by any person considering the purchase of the Deferred Annuity. You should
consult with your own tax advisor to determine if the potential advantages to
you of this arrangement outweigh the potential tax risks in view of your
individual circumstances.
Non-Qualified and Enhanced Non-Qualified Deferred Annuities. The tax rules
outlined in this section for both non-Qualified and Enhanced Non-Qualified
Deferred Annuities are the same. No limits apply under the Code to the amount of
purchase payments that you may make. Tax on income earned under the Deferred
Annuities is generally deferred until it is withdrawn only if you as owner of
the Deferred Annuity are an individual (or are treatable as a natural person
under certain other circumstances specified by the Code). The following
discussion assumes that this is the case.
Any withdrawal is generally treated as coming first from earnings (and thus
subject to tax) and next from your contributions (and thus a nontaxable return
of principal) only after all earnings are paid out. This rule does not apply to
payments made under income annuities, however. Such payments are subject to an
"exclusion ratio" which determines how much of each payment is a non-taxable
return of your contributions and how much is a taxable payment of earnings. Once
the total amount treated as a return of your contributions equals the amount of
such contributions, all remaining payments are fully taxable. If you die before
all contributions are returned, the unreturned amount may be deductible on your
final income tax return or deductible by your beneficiary if payments continue
after your death. We will tell the purchaser of an income annuity what your
contributions were and how much of each income payment is a non-taxable return
of contributions.
Taxable withdrawals (other than tax-free exchanges to other non-qualified
deferred annuities) before you are age 59 1/2 are subject to a 10% tax penalty.
This penalty does not apply to withdrawals (1) paid to a beneficiary or your
estate after your death; (2) due to your permanent disability (as defined in the
Code); or (3) made in substantially equal periodic payments (not less frequently
than annually) over the life or life expectancy of you or you and another person
named by you as your beneficiary.
Your Non-Qualified Deferred Annuity may be exchanged for another
non-qualified deferred annuity without incurring Federal income taxes if Code
requirements are met. Under the Code, withdrawals need not be made by a
particular age. However, it is possible that the Internal Revenue Service may
determine that the Deferred Annuity must be surrendered or income payments must
commence by a certain age,
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e.g., 85 or older. If you die before the payments under an income annuity
begins, we must make payment of your entire interest under the Deferred Annuity
within five years of your death or begin payments under an income annuity
allowed by the Code to your beneficiary within one year of your death. If your
spouse is your beneficiary or a co-owner of the Non-Qualified Deferred Annuity,
this rule does not apply. If you die after income payments begin, payments must
continue to be made at least as rapidly as under the method of distribution that
was used at the time of your death in accordance with the income type selected.
The tax law treats all non-qualified deferred annuities issued after
October 21, 1988 by the same company (or its affiliates) to the same owner
during any one calendar year as one annuity. This may cause a greater portion of
your withdrawals from the Deferred Annuity to be treated as income than would
otherwise be the case. Although the law is not clear, the aggregation rule may
also adversely affect the tax treatment of payments received under an income
annuity where the owner has purchased more than one non-qualified annuity during
the same calendar year from the same or an affiliated company after October 21,
1988, and is not receiving income payments from all annuities at the same time.
HOW DO FEDERAL INCOME TAXES AFFECT YOUR INCOME ANNUITY?
The following discussion of the tax code provisions for the Income
Annuities includes the Enhanced Income Annuities subject to the same tax code
provisions.
Generally, all purchase payments under the Income Annuities other than
purchase payments under Non-Qualified and Roth IRA Income Annuities and purchase
payments consisting of non-deductible contributions under IRA Income Annuities,
will be on a "before-tax" basis. This means that the purchase payment was either
a reduction from income, entitled you to a tax deduction or was not subject to
current income tax. Because of this, Federal income taxes are payable on the
full amount of money paid as income payments under the Income Annuity.
Generally, the Non-Qualified Income Annuities are issued on an "after-tax
basis" so that making a purchase payment does not reduce the taxes you pay. That
portion of any income payment that represents income is taxed when you receive
it, but that portion that represents the purchase payment is a nontaxable return
of principal. For the Roth IRA Income Annuity, "qualified distributions" of
earnings are not subject to tax. Withdrawals of contributions are generally not
subject to income tax. However, withdrawals from a Roth IRA of taxable converted
amounts may be subject to a penalty tax if made before age 59 1/2.
The IRA Income Annuities and under some circumstances certain Income
Annuities accept both purchase payments that have entitled you as the owner to a
current tax deduction or to a reduction in taxable income and those that do not.
Taxation of income payments depends on whether or not you as the owner were
entitled to deduct or exclude the purchase payments from income in compliance
with the Code. Roth IRA Deferred Annuities only accept "after-tax"
contributions.
All taxable income payments (other than income payments under the PEDC
Income Annuities) will be subject to Federal income tax withholding unless the
payee elects to have no withholding. The rate of withholding is as determined by
the Code at the time of payment. All taxable income payments under the PEDC
Income Annuities will be subject to the same federal income tax withholding
treatment as regular wages.
Income payments (other than tax-free transfers to other Section 403(b)
funding vehicles and payments made under a PEDC plan) that are allowed before
age 59 1/2 are generally subject to an additional 10% tax penalty on the taxable
portion of the income payment. (Under a SIMPLE IRA, the tax penalty is increased
to 25% for withdrawals during the first two years of an employee's participation
in the SIMPLE IRA.) This penalty does not apply to income payments (1) paid to
your beneficiary or your estate after your death; (2) due to your permanent
disability (as defined in the Code); or (3) made in substantially equal periodic
payments (not less frequently than annually) over your life or life expectancy
of you and another person named by you, (for TSAs, Keogh and 403(a) plans, you
must also be separated from service when payments begin); and (4) under a
Non-Qualified Income Annuity purchased with a single purchase payment which
provides for substantially equal payments (to be made not less frequently than
annually) commencing no later than one year from the purchase date.
Additionally, under TSAs, Keogh and 403(a) plans the penalty does not apply to
income payments (1) made to you after you separate from service with your
employer after age 55; (2) made to you on account of deductible medical expenses
(whether or not you actually itemize deductions); or (3) made to an "alternate
payee" under a "qualified domestic relations order" (normally a spouse or
ex-spouse). For IRAs, SIMPLE IRAs and SEPS the 10% tax penalty will also not
apply to income payments to pay deductible medical expenses (whether or not you
actually itemize your deduction) to enable certain unemployed persons to pay
medical insurance premiums; made after December 31, 1997 to pay for qualified
higher education expenses; or made
18
<PAGE>
after December 31, 1997, for qualified first time home purchases. There is a
possibility that if you make transfers as described earlier in this Prospectus
before age 59 1/2 or within five years of the purchase of the Income Annuity,
the exercise of the transfer provision may cause the retroactive imposition of
this tax.
Income payments from a Roth IRA Income Annuity generally will be tax-free
to the extent the payment represents the return of contributions. However,
withdrawals from a Roth IRA of taxable converted amounts may be subject to a
penalty tax if made before age 59 1/2. Distributions from earnings will not be
subject to income taxes if they are "qualified distributions." To the extent
your income payments relate to earnings that do not meet the definition of
"qualified distribution" they will be subject to income tax and may be subject
to the 10% tax penalty if you are under 59 1/2 and do not meet one of the
exceptions previously discribed. However, withdrawals of taxable converted
amounts prior to age 59 1/2 and made within five taxable years from such
conversion will be subject to the 10% premature penalty tax (unless you meet an
exception). In addition, withdrawals in 1998, 1998 or 2000 of converted amounts
that have received four year income inclusion treatment will be included in
income in the year of the withdrawal (in addition to the amounts to be included
under the four year income inclusion election). The total aggregate amount to be
included in income shall not exceed the total taxable amount of the conversion.
Since the Roth IRA was signed into a tax law in August, 1997, and since many
aspects of the law have yet to be clarified, you should consult with your tax
advisor regarding developments concerning the tax treatment of Roth IRAs and the
appropriateness of the Roth IRA Income Annuity to your particular situation.
The following paragraphs will briefly summarize some of the federal tax
rules, but we will make no attempt to mention or explain every single rule that
may be relevant to you. We are not responsible for determining if your plan or
arrangement satisfies the requirements of the Code.
You must generally begin receiving distributions under the IRA, SIMPLE IRA,
and SEP Income Annuities no later than the April 1 of the calendar year
following the year in which you reach age 70 1/2 and a tax penalty of 50%
applies to payments which should have been made but were not. (For taxable years
after 1996, if you do not have a 5% or more ownership interest in your employer,
distributions for Keogh Income Annuities must generally begin no later than
April 1 of the calendar year following the later of: the year in which you reach
70 1/2 or, to the extent permitted under your plan or deferred annuity, the year
you retire.) This does not apply to a Roth IRA Income Annuity. Complex rules
apply to the timing and calculation of these income payments. Other complex
rules apply to how rapidly income payments must be made after your death. If you
die before income payments begin under an Income Annuity, the Code generally
requires that your entire interest be paid within five years of the year in
which you died or over a period not exceeding your beneficiary's life or life
expectancy. If you die before income payments begin, we will pay your entire
interest under the Deferred Annuity or Income Annuity in a lump sum to your
beneficiary after we receive proof of your death. For IRA, SIMPLE IRA and SEP
Income Annuities, if you die after income payments begin, payments must continue
to be made in accordance with the income type selected. The Code requires that
payments of your remaining interest continue to be made at least as rapidly as
under the method of distribution that was used at the time of your death.
For the Roth IRA Income Annuity, the Code requires any remaining payment be
made to your beneficiary within five years of the year in which you died or over
a period not exceeding your beneficiary's life or life expectancy. Therefore, if
you choose a Roth IRA Income Annuity that has a period certain (e.g., an income
annuity for life with a ten year term certain), the period certain cannot exceed
the greater of five years or the life expectancy of your beneficiary.
(Subsequent changes to your beneficiary after choosing a Roth IRA Income Annuity
may cause you to be in violation of this rule.)
For taxable years after 1996, if you do not have a 5% or more ownership
interest in your employer, distributions of your entire interest under the TSA,
Keogh, PEDC and 403(a) Income Annuities must be made beginning no later than the
April 1 of the calendar year following the later of: the year in which you reach
age 70 1/2 or, to the extent permitted under your plan or deferred annuity, the
year you retire. A tax penalty of 50% applies to payments which should have been
made but were not. Complex rules apply to the timing and calculation of these
income payments. Other complex rules apply to how rapidly income payments must
be made after your death. If you die before payments begin under an Income
Annuity, the Code generally requires that your entire interest under the Income
Annuity be paid within five years of the year in which you died. If you die
before payments begin under this Income Annuity, we will pay your entire
interest under the Income Annuity in a lump sum to the beneficiary after we
receive proof of death. If you die after income payments begin, payments must
continue to be made in accordance with the income type selected. The Code
requires that payments continue to be made at least as rapidly as under the
method of distribution that was used as of the date of your death.
19
<PAGE>
Any income payments distributed under 403(a) Income Annuities are generally
taxed according to the rules described under Section 72 of the Code.
If your benefit under a plan subject to the Retirement Equity Act (REA) is
worth more than $5,000, the Code requires that your Income Annuity protect your
spouse if you die before your receive any income payments under the Income
Annuity or if you die while income payments are being made. If your Income
Annuity is subject to the REA, your spouse has certain rights which may be
waived with the written consent of your spouse. Waiving these requirements will
cause your initial monthly benefit to increase.
Non-Qualified Income Annuity for Section 457(f) Deferred Compensation
Plans. Any income payments distributed under the plan to you or your beneficiary
are generally taxed according to the annuity rules under Section 72. Thus, when
deferred compensation is no longer subject to a substantial risk of forfeiture,
it is immediately includible in your income and it becomes an "after-tax"
purchase payment for the purposes of the tax rules governing income payments in
calculating the "exclusion ratio." It is unclear whether the 10% tax penalty for
distributions made prior to age 59 1/2 applies with respect to income payments
made under this type of plan. Thus, you should consult your own tax advisor to
clarify this issue.
Given the complexity and uncertainty inherent in this area of the tax law,
entities considering the purchase
of this Income Annuity to fund a Section 457(f) deferred compensation plan
should consult with their own tax advisors regarding the application of the
relevant rules to their particular situation. In connection with the sale of the
Non-Qualified Income Annuity for Section 457(f) Deferred Compensation Plans,
MetLife consulted special tax counsel regarding the major Federal tax issues
under Section 457. This advice from such counsel has not been updated to reflect
changes, if any, in the law and such advice was rendered solely to MetLife and
may not be relied upon by any person considering the purchase of the Deferred
Annuity.
Non-Qualified Income Annuity for Section 451 Deferred Fee Arrangements. A
trust established by the tax-exempt entity will own a Non-Qualified Income
Annuity which may be subject to taxation rules as described below under
"Non-Qualified Income Annuities." Since the trust is a grantor trust, any tax
consequences arising out of ownership of the Non-Qualified Income Annuity will
flow to the tax-exempt entity that is the grantor of such trust. Each tax-exempt
entity should consult its own tax advisor with respect to the tax rules
governing the Income Annuity. Participants in the taxable entity's deferred
compensation plan must look to the taxable entity for income payments under the
plan. It is unclear whether the 10% tax penalty for distributions made prior to
age 59 1/2 applies with respect to income payments made under this type of plan.
These persons should consult their own tax advisor for information on the tax
treatment of these income payments made under the plan.
Given the complexity and uncertainty inherent in this area of the tax law,
entities considering the purchase of this Income Annuity to fund a Section 451
deferred fee arrangement should consult with their own tax advisors regarding
the application of the relevant rules to their particular situation. In
connection with the sale of the Non-Qualified Income Annuity for Section 451
Deferred Fee Arrangements, MetLife consulted special tax counsel regarding the
major Federal tax issues under Section 451. This advice from such counsel has
not been updated to reflect changes, if any, in the law and such advice was
rendered solely to MetLife and may not be relied upon by any person considering
the purchase of the Defered Annuity.
Non-Qualified Income Annuity for Section 451 Deferred Compensation Plans. A
trust established by the tax-exempt entity or the taxable entity will own a Non-
Qualified Income Annuity which may be subject to taxation rules as described
below under "Non-Qualified Income Annuities." Since the trust is a grantor
trust, any tax consequences arising out of ownership of the Non-Qualified Income
Annuity will flow to the tax-exempt entity or the taxable entity that is the
grantor of such trust. Each such entity should consult its own tax advisor with
respect to the tax rules governing the Income Annuity. Participants will not be
taxed on their tax deferred compensation amounts until the year in which they
are paid or made available to them, unless under the method of accounting the
participant uses in computing taxable income such amount is to be properly
accounted for in a different period.
It is unclear whether the 10% tax penalty for distributions made prior to
age 59 1/2 applies with respect to income payments made under this type of plan.
Thus, you should consult your own tax advisor to clarify this issue.
Given the complexity and uncertainty inherent in this area of the tax law,
entities considering the purchase of this Income Annuity to fund a Section 451
deferred compensation plan should consult with their own tax advisors regarding
the application of the relevant rules to their particular situation. In
connection with the sale of the Non-Qualified Income Annuity for Section 451
Deferred Compensation Plans MetLife consulted special tax counsel regarding the
major Federal tax issues under Section 451. This advice from such counsel has
not been updated to reflect changes, if any, in the law and such advice was
rendered solely to MetLife and may not be relied upon by any person considering
the purchase of the Deferred Annuity.
20
<PAGE>
Non-Qualified Income Annuity for Section 457(e)(11) Severance and Death
Benefit Plans. As the owner of a Non-Qualified Income Annuity, the trust is
generally subject to the rules described below under "Non-Qualified Income
Annuities." Since the trust is a grantor trust, any tax consequences arising out
of ownership of the Non-Qualified Income Annuity will flow to the employer, the
grantor of such trust. Each employer should consult with its own tax advisor
with respect to the tax rules governing the Income Annuity.
The Federal income tax consequences to you of this arrangement depend on
whether the program qualifies as a "bona-fide severance pay" and a "bona-fide
death benefit" plan as described in Section 457(e)(11) of the Code. If the
arrangement qualifies as a "bona-fide severance pay" and "bona-fide death
benefit" plan Section 451 of the Code will apply and you will be taxed in the
tax year in which such benefits are paid or made available to you, unless under
the method of accounting you use in computing taxable income such amount is to
be properly accounted for in a different period. If the arrangement does not
qualify as a "bona-fide severance pay" and "bona-fide death benefit" plan, the
amounts which constituted your purchase payment will be subject to tax in the
year in which they are deferred. In the event, if you have not reported such
income, in addition to the Federal income tax you will have to pay, you will be
assessed interest, and you may be subject to certain penalties by the Internal
Revenue Service. It is unclear whether the 10% tax penalty of distributions made
prior to age 59 1/2 applies with respect to income payments made under this type
of plan. Thus, you should consult your own tax advisor to clarify this issue.
Special Tax Considerations for Non-Qualified Income Annuity for
Section 457(e)(11) Severance and Death Benefit Plans. There is a considerable
risk that this arrangement may not qualify as a "bona-fide severance pay" plan
under Section 457(e)(11), the applicable section of the Code. The term
"bona-fide severance pay" plan is not defined in that section. The term
"severance pay" plan has, however, been construed under other Code sections and
under Department of Labor regulations issued under the Employee Retirement
Income Security Act of 1974. In connection with the sale of the Non-Qualified
Income Annuity for Section 457(e)(11) Severance and Death Benefit Plans, MetLife
consulted special tax counsel regarding the major Federal tax issues under
Section 457. Subsequently, the United States Court of Appeals for the Federal
Circuit indicated that for purposes of another Code section, a severance pay
plan with features similar to this arrangement would not qualify as a valid
severance pay plan. While this decision addresses severance pay plans in a
different Code context, it is probable that a court would consider it in
determining the tax consequences of this arrangement. This advice received from
such counsel has not been updated to reflect this decision or other changes in
the law, and such advice was rendered solely to MetLife and may not be relied
upon by any person considering the purchase of the Income Annuity. You should
consult with your own tax advisor to determine if the potential advantages to
you of this arrangement outweigh the potential tax risks in view of your
individual circumstances.
Non-Qualified and Enhanced Non-Qualified Income Annuities. The following
discussion assumes that you are an individual (or are treated as a natural
person under certain other circumstances specified by the Code). Income payments
are subject to an "exclusion ratio" which determines how much of each income
payment is a non-taxable return of your purchase payment and how much is a
taxable payment of earnings. Generally, once the total amount treated as a
return of your purchase payment equals the amount of such purchase payment, all
remaining income payments are fully taxable. If you die before the purchase
payment is returned, the unreturned amount may be deductible on your final
income tax return or deductible by your beneficiary if income payments continue
after your death. We will tell the purchaser of an Income Annuity what your
purchase payment was and how much of each income payment is a non-taxable return
of your purchase payment.
If you die before income payments begin, the Code generally requires
payment of your entire interest in the non-qualified income annuity to be made
within five years of the date of your death. If you die before income payments
begin, we will pay your entire interest under the Income Annuity of your
beneificiary iin a lump sum after we receive proof of your death. If you die
after income payments begin, payments must continue to be made at least as
rapidly as under the method of distribution before your death, in accordance
with the income type selected.
The tax law treats two or more non-qualified deferred annuities isued after
October 21, 1988 by the same company (or its affiliates) to the same owner
during any one calendar year as one annuity. It is unclear whether this rule
adversely affects the tax treatment of income payments received under a contract
which was issued during the same calendar year in which you purchased another
annuity from the same company (or its affilates) under which your are not yet
receiving income payments.
21
<PAGE>
FOR THE PERIOD JANUARY 1, 1998 TO DECEMBER 31, 1998--PREFERENCE PLUS DEFERRED
ANNUITIES
(10% FREE CORRIDOR VERSION)
<TABLE>
<CAPTION>
CHANGE IN
ACCUMULATION AVERAGE ANNUAL
UNIT VALUE TOTAL RETURN
------------ --------------
<S> <C> <C>
State Street Research Growth Division.......... % %
State Street Research Income Division.......... % %
State Street Research Diversified Division..... % %
State Street Research Aggressive Growth
Division..................................... % %
MetLife Stock Index Division................... % %
Santander International Stock Division......... % %
Calvert Social Balanced Division............... % %
Janus Mid Cap Division......................... % %
Loomis Sayles High Yield Bond Division......... % %
T. Rowe Price Small Cap Growth Division........ % %
Scudder Global Equity Division................. % %
</TABLE>
FOR THE PERIOD JANUARY 1, 1994 TO DECEMBER 31, 1998--PREFERENCE PLUS DEFERRED
ANNUITIES
(10% FREE CORRIDOR VERSION)
<TABLE>
<CAPTION>
CHANGE IN
CHANGE IN ACCUMULATION
ACCUMULATION UNIT VALUE AVERAGE ANNUAL
UNIT VALUE ANNUALIZED TOTAL RETURN
------------ ------------ --------------
<S> <C> <C> <C>
State Street Research Growth
Division..................... % % %
State Street Research Income
Division..................... % % %
State Street Research
Diversified Division......... % % %
State Street Research
Aggressive Growth Division... % % %
MetLife Stock Index Division... % % %
Santander International Stock
Division..................... % % %
Calvert Social Balanced
Division..................... % % %
</TABLE>
FOR THE PERIOD INCEPTION TO DECEMBER 31, 1998--PREFERENCE PLUS DEFERRED
ANNUITIES
(10% FREE CORRIDOR VERSION)
<TABLE>
<CAPTION>
CHANGE IN
CHANGE IN ACCUMULATION
INCEPTION ACCUMULATION UNIT VALUE AVERAGE ANNUAL
DATE UNIT VALUE ANNUALIZED TOTAL RETURN
-------- ------------ ------------ --------------
<S> <C> <C> <C> <C>
State Street Research Growth
Division..................... 7/2/90 % % %
State Street Research Income
Division..................... 7/2/90 % % %
State Street Research
Diversified Division......... 7/2/90 % % %
State Street Research
Aggressive Growth Division... 7/2/90 % % %
MetLife Stock Index Division... 7/2/90 % % %
Santander International Stock
Division..................... 7/1/91 % % %
Calvert Social Balanced
Division..................... 9/17/90 % % %
Janus Mid Cap Division......... 3/3/97 % % %
Loomis Sayles High Yield Bond
Division..................... 3/3/97 % % %
T. Rowe Price Small Cap Growth
Division..................... 3/3/97 % % %
Scudder Global Equity
Division..................... 3/3/97 % % %
Harris Oakmark Large Cap Value
Division..................... 11/9/98 % % %
Lehman Brothers Aggregate Bond
Index Division............... 11/9/98 % % %
Morgan Stanley EAFE(Registered)
Index Division............... 11/9/98 % % %
Neuberger & Berman Partners Mid
Cap Value Division........... 11/9/98 % % %
Russell 2000 Index Division.... 11/9/98 % % %
T. Rowe Price Large Cap Growth
Division..................... 11/9/98 % % %
</TABLE>
22
<PAGE>
FOR THE JANUARY 1, 1998 TO DECEMBER 31, 1998--PREFERENCE PLUS (20% FREE CORRIDOR
VERSION)
<TABLE>
<CAPTION>
CHANGE IN
ACCUMULATION AVERAGE ANNUAL
UNIT VALUE TOTAL RETURN
------------ --------------
<S> <C> <C>
State Street Research Growth Division.......... % %
State Street Research Income Division.......... % %
State Street Research Diversified Division..... % %
State Street Research Aggressive Growth
Division..................................... % %
MetLife Stock Index Division................... % %
Santander International Stock Division......... % %
Calvert Social Balanced Division............... % %
Janus Mid Cap Division......................... % %
Loomis Sayles High Yield Bond Division......... % %
T. Rowe Price Small Cap Growth Division........ % %
Scudder Global Equity Division................. % %
</TABLE>
FOR THE PERIOD JANUARY 1, 1994 TO DECEMBER 31, 1998--PREFERENCE PLUS (20% FREE
CORRIDOR VERSION)
<TABLE>
<CAPTION>
CHANGE IN
CHANGE IN ACCUMULATION
ACCUMULATION UNIT AVERAGE ANNUAL
UNIT VALUE ANNUALIZED TOTAL RETURN
------------ ------------ --------------
<S> <C> <C> <C>
State Street Research Growth
Division..................... % % %
State Street Research Income
Division..................... % % %
State Street Research
Diversified Division......... % % %
State Street Research
Aggressive Growth Division... % % %
MetLife Stock Index Division... % % %
Santander International Stock
Division..................... % % %
Calvert Social Balanced
Division..................... % % %
</TABLE>
FOR THE PERIOD INCEPTION TO DECEMBER 31, 1998--PREFERENCE PLUS (20% FREE
CORRIDOR VERSION)
<TABLE>
<CAPTION>
CHANGE IN
CHANGE IN ACCUMULATION
INCEPTION ACCUMULATION UNIT AVERAGE ANNUAL
DATE UNIT VALUE ANNUALIZED TOTAL RETURN
-------- ------------ ------------ --------------
<S> <C> <C> <C> <C>
State Street Research Growth
Division..................... 7/2/90 % % %
State Street Research Income
Division..................... 7/2/90 % % %
State Street Research
Diversified Division......... 7/2/90 % % %
State Street Research
Aggressive Growth Division... 7/2/90 % % %
MetLife Stock Index Division... 7/2/90 % % %
Santander International Stock
Division..................... 7/1/91 % % %
Calvert Social Balanced
Division..................... 9/17/90 % % %
Janus Mid Cap Division......... 3/3/97 % % %
Loomis Sayles High Yield Bond
Division..................... 3/3/97 % % %
T. Rowe Price Small Cap Growth
Division..................... 3/3/97 % % %
Scudder Global Equity
Division..................... 3/3/97 % % %
Harris Oakmark Large Cap Value
Division..................... 11/9/98 % % %
Lehman Brothers Aggregate Bond
Index Division............... 11/9/98 % % %
Morgan Stanley EAFE(Registered)
Index Division............... 11/9/98 % % %
Neuberger & Berman Partners Mid
Cap Value Division........... 11/9/98 % % %
Russell 2000 Index Division.... 11/9/98 % % %
T. Rowe Price Large Cap Growth
Division..................... 11/9/98 % % %
</TABLE>
23
<PAGE>
YIELDS FOR THE 30 DAY PERIOD ENDING DECEMBER 31, 1998--PREFERENCE PLUS DEFERRED
ANNUITIES
<TABLE>
<S> <C>
State Street Research Growth Division..................... %
State Street Research Income Division..................... %
State Street Research Diversified Division................ %
State Street Research Aggressive Growth Division.......... %
MetLife Stock Index Division.............................. %
Santander International Stock Division.................... %
Janus Mid Cap Division.................................... %
Loomis Sayles High Yield Bond Division.................... %
T. Rowe Price Small Cap Growth Division................... %
Scudder Global Equity Division............................ %
Harris Oakmark Large Cap Value Division................... %
Lehman Brothers Aggregate Bond Index Division............. %
Morgan Stanley EAFE(Registered) Index Division............ %
Neuberger & Berman Partners Mid Cap Value Division........ %
Russell 2000 Index Division............................... %
T. Rowe Price Large Cap Growth Division................... %
</TABLE>
FOR THE PERIOD JANUARY 1, 1998 TO DECEMBER 31, 1998--ENHANCED PREFERENCE PLUS
DEFERRED ANNUITIES
(WITH SALES LOAD) (10% FREE CORRIDOR VERSION)
<TABLE>
<CAPTION>
CHANGE IN
ACCUMULATION AVERAGE ANNUAL
UNIT VALUE TOTAL RETURN
------------ --------------
<S> <C> <C>
State Street Research Growth Division.......... % %
State Street Research Income Division.......... % %
State Street Research Diversified Division..... % %
State Street Research Aggressive Growth
Division..................................... % %
MetLife Stock Index Division................... % %
Santander International Stock Division......... % %
Calvert Social Balanced Division............... % %
Janus Mid Cap Division......................... % %
Loomis Sayles High Yield Bond Division......... % %
T. Rowe Price Small Cap Growth Division........ % %
Scudder Global Equity Division................. % %
</TABLE>
FOR THE PERIOD JANUARY 1, 1994 TO DECEMBER 31, 1998--ENHANCED PREFERENCE PLUS
DEFERRED ANNUITIES
(WITH SALES LOAD) (10% FREE CORRIDOR VERSION)
<TABLE>
<CAPTION>
CHANGE IN
CHANGE IN ACCUMULATION
ACCUMULATION UNIT VALUE AVERAGE ANNUAL
UNIT VALUE ANNUALIZED TOTAL RETURN
------------ ------------ --------------
<S> <C> <C> <C>
State Street Research Growth
Division..................... % % %
State Street Research Income
Division..................... % % %
State Street Research
Diversified Division......... % % %
State Street Research
Aggressive Growth Division... % % %
MetLife Stock Index Division... % % %
Santander International Stock
Division..................... % % %
Calvert Social Balanced
Division..................... % % %
</TABLE>
24
<PAGE>
FOR THE PERIOD INCEPTION TO DECEMBER 31, 1998--ENHANCED PREFERENCE PLUS DEFERRED
ANNUITIES
(WITH SALES LOAD) (10% FREE CORRIDOR VERSION)
<TABLE>
<CAPTION>
CHANGE IN
CHANGE IN ACCUMULATION
INCEPTION ACCUMULATION UNIT VALUE AVERAGE ANNUAL
DATE UNIT VALUE ANNUALIZED TOTAL RETURN
-------- ------------ ------------ --------------
<S> <C> <C> <C> <C>
State Street Research Growth
Division..................... 7/2/90 % % %
State Street Research Income
Division..................... 7/2/90 % % %
State Street Research
Diversified Division......... 7/2/90 % % %
State Street Research
Aggressive Growth Division... 7/2/90 % % %
MetLife Stock Index Division... 7/2/90 % % %
Santander International Stock
Division..................... 7/1/91 % % %
Calvert Social Balanced
Division..................... 5/1/91 % % %
Janus Mid Cap Division......... 3/3/97 % % %
Loomis Sayles High Yield Bond
Division..................... 3/3/97 % % %
T. Rowe Price Small Cap Growth
Division..................... 3/3/97 % % %
Scudder Global Equity
Division..................... 3/3/97 % % %
Harris Oakmark Large Cap Value
Division..................... 11/9/98 % % %
Lehman Brothers Aggregate Bond
Index Division............... 11/9/98 % % %
Morgan Stanley EAFE(Registered)
Index Division............... 11/9/98 % % %
Neuberger & Berman Partners Mid
Cap Value Division........... 11/9/98 % % %
Russell 2000 Index Division.... 11/9/98 % % %
T. Rowe Price Large Cap Growth
Division..................... 11/9/98 % % %
</TABLE>
FOR THE PERIOD JANUARY 1, 1998 TO DECEMBER 31, 1998--ENHANCED PREFERENCE PLUS
DEFERRED ANNUITIES
(WITH SALES LOAD) (20% FREE CORRIDOR VERSION)
<TABLE>
<CAPTION>
CHANGE IN
ACCUMULATION AVERAGE ANNUAL
UNIT VALUE TOTAL RETURN
------------ --------------
<S> <C> <C>
State Street Research Growth Division.......... % %
State Street Research Income Division.......... % %
State Street Research Diversified Division..... % %
State Street Research Aggressive Growth
Division..................................... % %
MetLife Stock Index Division................... % %
Santander International Stock Division......... % %
Janus Mid Cap Division......................... % %
Loomis Sayles High Yield Bond Division......... % %
T. Rowe Price Small Cap Growth Division........ % %
Scudder Global Equity Division................. % %
Harris Oakmark Large Cap Value Division........ % %
Lehman Brothers Aggregate Bond Index
Division..................................... % %
Morgan Stanley EAFE(Registered) Index
Division..................................... % %
Neuberger & Berman Partners Mid Cap Value
Division..................................... % %
Russell 2000 Index Division.................... % %
T. Rowe Price Large Cap Growth Division........ % %
Calvert Social Balanced Division............... % %
Calvert Social Mid Cap Growth Division......... % %
Fidelity Equity-Income Division................ % %
Fidelity Growth Division....................... % %
Fidelity Overseas Division..................... % %
Fidelity Investment Grade Bond Division........ % %
Fidelity Asset Manager Division................ % %
</TABLE>
25
<PAGE>
FOR THE PERIOD JANUARY 1, 1994 TO DECEMBER 31, 1998--
ENHANCED PREFERENCE PLUS DEFERRED ANNUITIES (WITH SALES LOAD) (20% FREE CORRIDOR
VERSION)
<TABLE>
<CAPTION>
CHANGE IN
CHANGE IN ACCUMULATION
ACCUMULATION UNIT VALUE AVERAGE ANNUAL
UNIT VALUE ANNUALIZED TOTAL RETURN
------------ ------------ --------------
<S> <C> <C> <C>
State Street Research Growth
Division..................... % % %
State Street Research Income
Division..................... % % %
State Street Research
Diversified Division......... % % %
State Street Research
Aggressive Growth Division... % % %
MetLife Stock Index Division... % % %
Santander International Stock
Division..................... % % %
Calvert Social Balanced
Division..................... % % %
Calvert Social Mid Cap Growth
Division..................... % % %
Fidelity Equity-Income
Division..................... % % %
Fidelity Growth Division....... % % %
Fidelity Overseas Division..... % % %
Fidelity Investment Grade Bond
Division..................... % % %
Fidelity Asset Manager
Division..................... % % %
</TABLE>
FOR THE PERIOD INCEPTION TO DECEMBER 31, 1998--
ENHANCED PREFERENCE PLUS DEFERRED ANNUITIES (WITH SALES LOAD) (20% FREE CORRIDOR
VERSION)
<TABLE>
<CAPTION>
CHANGE IN
CHANGE IN ACCUMULATION
INCEPTION ACCUMULATION UNIT VALUE AVERAGE ANNUAL
DATE UNIT VALUE ANNUALIZED TOTAL RETURN
-------- ------------ ------------ --------------
<S> <C> <C> <C> <C>
State Street Research Growth
Division..................... 7/2/90 % % %
State Street Research Income
Division..................... 7/2/90 % % %
State Street Research
Diversified Division......... 7/2/90 % % %
State Street Research
Aggressive Growth Division... 7/2/90 % % %
MetLife Stock Index Division... 7/2/90 % % %
Santander International Stock
Division..................... 7/1/91 % % %
Janus Mid Cap Division......... 3/3/97 % % %
Loomis Sayles High Yield Bond
Division..................... 3/3/97 % % %
T. Rowe Price Small Cap Growth
Division..................... 3/3/97 % % %
Scudder Global Equity
Division..................... 3/3/97 % % %
Harris Oakmark Large Cap Value
Division..................... 11/9/98 % % %
Lehman Brothers Aggregate Bond
Index Division............... 11/9/98 % % %
Morgan Stanley EAFE(Registered)
Index Division............... 11/9/98 % % %
Neuberger & Berman Partners Mid
Cap Value Division........... 11/9/98 % % %
Russell 2000 Index Division.... 11/9/98 % % %
T. Rowe Price Large Cap Growth
Division..................... 11/9/98 % % %
Calvert Social Balanced
Division..................... 5/1/91 % % %
Calvert Social Mid Cap Growth
Division..................... 5/1/92 % % %
Fidelity Equity-Income
Division..................... 5/1/92 % % %
Fidelity Growth Division....... 5/1/92 % % %
Fidelity Overseas Division..... 5/1/92 % % %
Fidelity Investment Grade Bond
Division..................... 5/1/92 % % %
Fidelity Asset Manager
Division..................... 5/1/92 % % %
</TABLE>
26
<PAGE>
FOR THE PERIOD JANUARY 1, 1998 TO DECEMBER 31, 1998--
ENHANCED NON-QUALIFIED PREFERENCE PLUS DEFERRED ANNUITIES (NO SALES LOAD)
<TABLE>
<CAPTION>
CHANGE IN
ACCUMULATION AVERAGE ANNUAL
UNIT VALUE TOTAL RETURN
------------ --------------
<S> <C> <C>
State Street Research Growth Division.......... % %
State Street Research Income Division.......... % %
State Street Research Diversified Division..... % %
State Street Research Aggressive Growth
Division..................................... % %
MetLife Stock Index Division................... % %
Santander International Stock Division......... % %
Janus Mid Cap Division......................... % %
Loomis Sayles High Yield Bond Division......... % %
T. Rowe Price Small Cap Growth Division........ % %
Scudder Global Equity Division................. % %
Calvert Social Balanced Division............... % %
Calvert Social Mid Cap Growth Division......... % %
Fidelity Equity-Income Division................ % %
Fidelity Growth Division....................... % %
Fidelity Overseas Division..................... % %
Fidelity Investment Grade Bond Division........ % %
Fidelity Asset Manager Division................ % %
</TABLE>
FOR THE PERIOD JANUARY 1, 1994 THROUGH DECEMBER 31, 1998--
ENHANCED NON-QUALIFIED PREFERENCE PLUS DEFERRED ANNUITIES (NO SALES LOAD)
<TABLE>
<CAPTION>
CHANGE IN
CHANGE IN ACCUMULATION AVERAGE
ACCUMULATION UNIT VALUE ANNUAL
UNIT VALUE ANNUALIZED TOTAL RETURN
------------ ------------ ------------
<S> <C> <C> <C>
State Street Research Growth
Division..................... % % %
State Street Research Income
Division..................... % % %
State Street Research
Diversified Division......... % % %
State Street Research
Aggressive Growth Division... % % %
MetLife Stock Index Division... % % %
Santander International Stock
Division..................... % % %
Calvert Social Balanced
Division..................... % % %
Calvert Social Mid Cap
Division..................... % % %
Fidelity Equity-Income
Division..................... % % %
Fidelity Growth Division....... % % %
Fidelity Overseas Division..... % % %
Fidelity Investment Grade Bond
Division..................... % % %
Fidelity Asset Manager
Division..................... % % %
</TABLE>
27
<PAGE>
FOR THE PERIOD INCEPTION TO DECEMBER 31, 1998--
ENHANCED NON-QUALIFIED PREFERENCE PLUS DEFERRED ANNUITIES (NO SALES LOAD)
<TABLE>
<CAPTION>
CHANGE IN
CHANGE IN ACCUMULATION
INCEPTION ACCUMULATION UNIT VALUE AVERAGE ANNUAL
DATE UNIT VALUE ANNUALIZED TOTAL RETURN
-------- ------------ ------------ --------------
<S> <C> <C> <C> <C>
State Street Research Growth
Division..................... 5/1/91 % % %
State Street Research Income
Division..................... 5/1/91 % % %
State Street Research
Diversified Division......... 5/1/91 % % %
State Street Research
Aggressive Growth Division... 5/1/91 % % %
MetLife Stock Index Division... 5/1/91 % % %
Santander International Stock
Division..................... 7/1/91 % % %
Janus Mid Cap Division......... 3/3/97 % % %
Loomis Sayles High Yield Bond
Division..................... 3/3/97 % % %
T. Rowe Price Small Cap Growth
Division..................... 3/3/97 % % %
Scudder Global Equity
Division..................... 3/3/97 % % %
Harris Oakmark Large Cap Value
Division..................... 11/9/98 % % %
Lehman Brothers Aggregate Bond
Index Division............... 11/9/98 % % %
Morgan Stanley EAFE(Registered)
Index Division............... 11/9/98 % % %
Neuberger & Berman Partners Mid
Cap Value Division........... 11/9/98 % % %
Russell 2000 Index Division.... 11/9/98 % % %
T. Rowe Price Large Cap Growth
Division..................... 11/9/98 % % %
Calvert Social Balanced
Division..................... 5/1/91 % % %
Calvert Social Mid Cap Growth
Division..................... 5/1/92 % % %
Fidelity Equity-Income
Division..................... 5/1/92 % % %
Fidelity Growth Division....... 5/1/92 % % %
Fidelity Overseas Division..... 5/1/92 % % %
Fidelity Investment Grade Bond
Division..................... 5/1/92 % % %
Fidelity Asset Manager Division 5/1/92 % % %
</TABLE>
YIELDS FOR THE 30 DAY PERIOD ENDING DECEMBER 31, 1998--
ENHANCED PREFERENCE PLUS DEFERRED ANNUITIES
<TABLE>
<S> <C>
State Street Research Growth Division..................... %
State Street Research Income Division..................... %
State Street Research Diversified Division................ %
State Street Research Aggressive Growth Division.......... %
MetLife Stock Index Division.............................. %
Santander International Stock Division.................... %
Janus Mid Cap Division.................................... %
Loomis Sayles High Yield Bond Division.................... %
T. Rowe Price Small Cap Growth Division................... %
Scudder Global Equity Division............................ %
Harris Oakmark Large Cap Value Division................... %
Lehman Brothers Aggregate Bond Index Division............. %
Morgan Stanley EAFE(Registered) Index Division............ %
Neuberger & Berman Partners Mid Cap Value Division........ %
Russell 2000 Index Division............................... %
T. Rowe Price Large Cap Growth Division................... %
</TABLE>
28
<PAGE>
FOR THE PERIOD JANUARY 1, 1998 TO DECEMBER 31, 1998--
FINANCIAL FREEDOM ACCOUNT DEFERRED ANNUITIES
<TABLE>
<CAPTION>
CHANGE IN
ACCUMULATION AVERAGE ANNUAL
UNIT VALUE TOTAL RETURN
------------ --------------
<S> <C> <C>
State Street Research Growth Division.......... % %
State Street Research Income Division.......... % %
State Street Research Diversified Division..... % %
State Street Research Aggressive Growth
Division..................................... % %
Santander International Stock Division......... % %
MetLife Stock Index Division................... % %
Janus Mid Cap Division......................... % %
Loomis Sayles High Yield Bond Division......... % %
T. Rowe Price Small Cap Growth Division........ % %
Scudder Global Equity Division................. % %
Calvert Social Balanced Division............... % %
Calvert Social Mid Cap Growth Division......... % %
Fidelity Equity-Income Division................ % %
Fidelity Growth Division....................... % %
Fidelity Overseas Division..................... % %
Fidelity Investment Grade Bond Division........ % %
Fidelity Asset Manager Division................ % %
</TABLE>
FOR THE PERIOD JANUARY 1, 1994 TO DECEMBER 31, 1998--FINANCIAL FREEDOM ACCOUNT
DEFERRED ANNUITIES
<TABLE>
<CAPTION>
CHANGE IN
CHANGE IN ACCUMULATION
ACCUMULATION UNIT VALUE AVERAGE ANNUAL
UNIT VALUE ANNUALIZED TOTAL RETURN
------------ ------------ --------------
<S> <C> <C> <C>
MetLife Stock Index Division... % % %
Calvert Social Balanced
Division..................... % % %
Calvert Social Mid Cap Growth
Division..................... % % %
Fidelity Equity-Income
Division..................... % % %
Fidelity Growth Division....... % % %
Fidelity Overseas Division..... % % %
Fidelity Investment Grade Bond
Division..................... % % %
Fidelity Asset Manager
Division..................... % % %
</TABLE>
29
<PAGE>
FOR THE PERIOD INCEPTION TO DECEMBER 31, 1997--FINANCIAL FREEDOM ACCOUNT
DEFERRED ANNUITIES
<TABLE>
<CAPTION>
CHANGE IN
CHANGE IN ACCUMULATION
INCEPTION ACCUMULATION UNIT VALUE AVERAGE ANNUAL
DATE UNIT VALUE ANNUALIZED TOTAL RETURN
-------- ------------ ------------ --------------
<S> <C> <C> <C> <C>
State Street Research Growth
Division..................... 5/1/96 % % %
State Street Research Income
Division..................... 5/1/96 % % %
State Street Research
Diversified Division......... 5/1/96 % % %
State Street Research
Aggressive Growth Division... 5/1/96 % % %
Santander International Stock
Division..................... 5/1/96 % % %
MetLife Stock Index Division... 7/1/91 % % %
Janus Mid Cap Division......... 3/3/97 % % %
Loomis Sayles High Yield
Division..................... 3/3/97 % % %
T. Rowe Price Small Cap Growth
Division..................... 3/3/97 % % %
Scudder Global Equity
Division..................... 3/3/97 % % %
Harris Oakmark Large Cap Value
Division..................... 11/9/98 % % %
Lehman Brothers Aggregate Bond
Index Division............... 11/9/98 % % %
Morgan Stanley EAFE(Registered)
Index Division............... 11/9/98 % % %
Neuberger & Berman Partners Mid
Cap Value Division........... 11/9/98 % % %
Russell 2000 Index Division.... 11/9/98 % % %
T. Rowe Price Large Cap Growth
Division..................... 11/9/98 % % %
Calvert Social Balanced
Division..................... 7/1/91 % % %
Calvert Social Mid Cap Growth
Division..................... 7/1/91 % % %
Fidelity Equity-Income
Division..................... 7/1/91 % % %
Fidelity Growth Division....... 7/1/91 % % %
Fidelity Overseas Division..... 7/1/91 % % %
Fidelity Investment Grade Bond
Division..................... 7/1/91 % % %
Fidelity Asset Manager
Division..................... 7/1/91 % % %
</TABLE>
MONEY MARKET DIVISIONS--SEVEN DAY PERIOD ENDING DECEMBER 31, 1998
<TABLE>
<CAPTION>
EFFECTIVE
YIELD YIELD
------------ ------------
<S> <C> <C>
VestMet Deferred Annuities..................... % %
Enhanced VestMet Deferred Annuities............ % %
Financial Freedom Account Deferred Annuities... % %
</TABLE>
FOR THE PERIOD JANUARY 1, 1998 TO DECEMBER 31, 1998--VESTMET DEFERRED ANNUITIES
<TABLE>
<CAPTION>
CHANGE IN AVERAGE
ACCUMULATION ANNUAL
UNIT VALUE TOTAL RETURN
------------ ------------
<S> <C> <C>
Growth Division................................ % %
Income Division................................ % %
Diversified Division........................... % %
Aggressive Growth Division..................... % %
Stock Index Division........................... % %
</TABLE>
30
<PAGE>
FOR THE PERIOD JANUARY 1, 1994 TO DECEMBER 31, 1998--VESTMET DEFERRED ANNUITIES
<TABLE>
<CAPTION>
CHANGE IN
CHANGE IN ACCUMULATION AVERAGE
ACCUMULATION UNIT VALUE ANNUAL
UNIT VALUE ANNUALIZED TOTAL RETURN
------------ ------------ ------------
<S> <C> <C> <C>
Growth Division................ % % %
Income Division................ % % %
Diversified Division........... % % %
Aggressive Growth Division..... % % %
Stock Index Division........... % % %
</TABLE>
FOR THE PERIOD JANUARY 1, 1989 TO DECEMBER 31, 1998--VESTMET DEFERRED ANNUITIES
<TABLE>
<CAPTION>
CHANGE IN
CHANGE IN ACCUMULATION AVERAGE
ACCUMULATION UNIT VALUE ANNUAL
UNIT VALUE ANNUALIZED TOTAL RETURN
------------ ------------ ------------
<S> <C> <C> <C>
Growth Division................ % % %
Income Division................ % % %
Diversified Division........... % % %
Aggressive Growth Division..... % % %
</TABLE>
FOR THE PERIOD INCEPTION TO DECEMBER 31, 1998--VESTMET DEFERRED ANNUITIES
<TABLE>
<CAPTION>
CHANGE IN
CHANGE IN ACCUMULATION AVERAGE
INCEPTION ACCUMULATION UNIT VALUE ANNUAL
DATE UNIT VALUE ANNUALIZED TOTAL RETURN
-------- ------------ ------------ ------------
<S> <C> <C> <C> <C>
Stock Index Division........... 5/1/90 % % %
</TABLE>
YIELDS FOR THE 30 DAY PERIOD ENDING DECEMBER 31, 1998--VESTMET DEFERRED
ANNUITIES
<TABLE>
<S> <C>
Growth Division........................................... %
Income Division........................................... %
Diversified Division...................................... %
Aggressive Growth Division................................ %
Stock Index Division...................................... %
</TABLE>
FOR THE PERIOD JANUARY 1, 1998 TO DECEMBER 31, 1998--ENHANCED VESTMET DEFERRED
ANNUITIES
<TABLE>
<CAPTION>
CHANGE IN AVERAGE
ACCUMULATION ANNUAL
UNIT VALUE TOTAL RETURN
------------ ------------
<S> <C> <C>
Growth Division................................ % %
Income Division................................ % %
Diversified Division........................... % %
Aggressive Growth Division..................... % %
Stock Index Division........................... % %
</TABLE>
31
<PAGE>
FOR THE PERIOD JANUARY 1, 1994 TO DECEMBER 31, 1998--
ENHANCED VESTMET DEFERRED ANNUITIES
<TABLE>
<CAPTION>
CHANGE IN CHANGE IN AVERAGE
ACCUMULATION ACCUMULATION ANNUAL
UNIT VALUE UNIT ANNUALIZED TOTAL RETURN
------------ --------------- ------------
<S> <C> <C> <C>
Growth Division................ % % %
Income Division................ % % %
Diversified Division........... % % %
Aggressive Growth Division..... % % %
Stock Index Division........... % % %
</TABLE>
FOR THE PERIOD JANUARY 1, 1989 TO DECEMBER 31, 1998--
ENHANCED VESTMET DEFERRED ANNUITIES
<TABLE>
<CAPTION>
CHANGE IN
CHANGE IN ACCUMULATION AVERAGE
ACCUMULATION UNIT VALUE ANNUAL
UNIT VALUE ANNUALIZED TOTAL RETURN
------------ --------------- ------------
<S> <C> <C> <C>
Growth Division................ % % %
Income Division................ % % %
Diversified Division........... % % %
Aggressive Growth Division..... % % %
</TABLE>
FOR THE PERIOD INCEPTION TO DECEMBER 31, 1998--
ENHANCED VESTMET DEFERRED ANNUITIES
<TABLE>
<CAPTION>
CHANGE IN
CHANGE IN ACCUMULATION AVERAGE
INCEPTION ACCUMULATION UNIT VALUE ANNUAL
DATE UNIT VALUE ANNUALIZED TOTAL RETURN
-------- ------------ --------------- ------------
<S> <C> <C> <C> <C>
Stock Index Division........... 5/1/90 % % %
</TABLE>
YIELDS FOR THE 30 DAY PERIOD ENDING DECEMBER 31, 1998--
ENHANCED VESTMET DEFERRED ANNUITIES
<TABLE>
<CAPTION>
<S> <C>
Growth Division........................................... %
Income Division........................................... %
Diversified Division...................................... %
Aggressive Growth Division................................ %
Stock Index Division...................................... %
</TABLE>
32
<PAGE>
PART II
OTHER INFORMATION
ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS
(A) FINANCIAL STATEMENTS
The following financial statements are included in Part B of this
Post-Effective Amendment on Form N-4 (to be filed by amendment):
Metropolitan Life Separate Account E
Financial Statements for the Years Ended December 31, 1998 and 1997
Independent Auditors' Report
Statements of Assets and Liabilities
Statements of Operations
Statements of Changes in Net Assets
Notes to Financial Statements
Metropolitan Life Insurance Company
Financial Statements for the Years Ended December 31, 1998, 1997 and
1996
Independent Auditors' Report
Consolidated Balance Sheets
Consolidated Statements of Earnings
Consolidated Statements of Cash Flow
Consolidated Statements of Equity
Notes to Consolidated Financial Statements
(B) EXHIBITS
<TABLE>
<S> <C>
(1) -- Resolution of the Board of Directors of Metropolitan Life
establishing Separate Account E.(2)
(2) -- Not applicable.
(3)(a) -- Not applicable.
(b) -- Form of Selected Broker Agreement.(2)
(c) -- Participation Agreement--Calvert.(5)
(d) -- Participation Agreements--Fidelity Distributors Corp.(5)
(d)(i) -- Supplemental Agreements--Fidelity
(4)(a) -- Amended Form of IRC Section 401 Group Annuity Contract
(VestMet).(5)
(a)(i) -- Form of IRC Section 401 Group Annuity Contract (Preference
Plus) (Version 2).(5)
(a)(ii) -- Form of IRC Section 401 Group Annuity Contract (Preference
Plus) (Allocated and Unallocated).(5)
(a)(iii) -- Form IRC Section 401 Individual Annuity Contract (Preference
Plus).(5)
(a)(iv) -- Form IRC Section 401 Group Annuity Contract (Preference
Plus) (Oregon).(2)
(a)(v) -- Form IRC Section 401 Group Annuity Contract (Preference
Plus) (Allocated).(4)
(a)(vi) -- Form IRC Section 401 Group Annuity Contract (Preference
Plus) (Allocated) (New York).(4)
(a)(vii) -- Form of Certificate under IRC Section 401 Group Annuity
Contract (Preference Plus) (New York).(4)
(b) -- Amended Form of IRC Section 403(b) Group Annuity Contract
(VestMet).(5)
(b)(i) -- Amended Form of IRC Section 403(b) Group Annuity Contract
(Preference Plus).(5)
(b)(i)(A) -- Form of IRC Section 403(b) Group Annuity Contract (Financial
(b)(i)(B) -- Form of IRC Section 403(b) Group Annuity Contract (Enhanced
Preference Plus Contract-Montefiore Medical Center,
Maimonides Medical Center, The Mount Sinai Hospital).(2)
Freedom-LIJ).(5)
</TABLE>
II-1
<PAGE>
<TABLE>
<S> <C>
(b)(i)(C) -- Form of IRC Section 403(b) Group Annuity Contract (Financial
Freedom Account) (New Jersey-ABP).(4)
(b)(i)(D) -- Form of IRC Section 403(b) Group Annuity Contract (Financial
Freedom Account) (Texas-ORP).(4)
(b)(i)(E) -- Form of IRC Section 403(b) Individual Annuity Contract
(Preference Plus) (Oregon).(4)
(b)(ii) -- Form of Certificate under IRC Section 403(b) Group Annuity
Contract (VestMet).(5)
(b)(iii) -- Form of Certificate under IRC Section 403(b) Group Annuity
Contract (Preference Plus) (Version 2).(5)
(b)(iii)(A) -- Form of Certificate under IRC Section 403(b) Group Annuity
Contract (Preference Plus) (Versions 1 and 2).(5)
(b)(iii)(B) -- Amended Form of Certificate under IRC Section 403(b) Group
Annuity Contract (Preference Plus) (New York).(5)
(b)(iii)(C) -- Form of Certificate under IRC Section 403(b) Group Annuity
Contract (Financial Freedom Account).(5)
(b)(iii)(D) -- Forms of Certificate under IRC Section 403(b) Group Annuity
Contract (Preference Plus--Enhanced TSA Preference Plus
Contract).(5)
(b)(iii)(E) -- Amended Form of Certificate under IRC Section 403(b) Group
Annuity Contract (Preference Plus).(5)
(b)(iii)(F) -- Form of Certificate under IRC Section 403(b) Group Annuity
Contract (Chapman).(5)
(b)(iii)(G) -- Form of Certificate under IRC Section 403(b) Group Annuity
Contract (Preference Plus, Enhanced Preference Plus,
Financial Freedom) (Oregon).(2)
(b)(iii)(H) -- Form of Endorsement under IRC Section 403(b) Group Annuity
Contract (Preference Plus).(2)
(b)(iii)(I) -- Form of Endorsement under Section 403(b) Group Annuity
Contract (Preference Plus, Enhanced Preference Plus,
Financial Freedom).(2)
(b)(iv) -- Form of Texas Rider for Certificate under IRC
Section 403(b) Group Annuity Contract (VestMet).(5)
(b)(v) -- Form of Texas Endorsement for Certificate under IRC
Section 403(b) Group Annuity Contract (Preference Plus).(5)
(b)(vi) -- Form of Certificate under IRC Section 403(b) Group Annuity
Contract (Financial Freedom Account) (New Jersey-ABP).(4)
(b)(vii) -- Form of Certificate under IRC Section 403(b) Group Annuity
Contract (Enhanced Preference Plus) (Oregon).(4)
(b)(viii) -- Form of Certificate under IRC Section 403(b) Group Annuity
Contract (Financial Freedom) (Texas-ORP).(4)
(b)(ix) -- Form of Certificate under IRC Section 403(b) Group Annuity
Contract (Financial Freedom Account) (Texas-ORP).(4)
(b)(x) -- Forms of Endorsement under IRC Section 403(b) Group Annuity
Contract, 403(a) Group Annuity Contract and Individual
Retirement Annuity Contract.(4,5)
(b)(xi) -- Forms of Endorsement under IRC Section 403(b) Group Annuity
Contract.(4,5)
(b)(xii) -- Forms of Endorsement under IRC Section 403(b) for Annuity
Contract (VestMet)--Forms R.S.1208 and G.20247-567(7)
(b)(xiii) -- Forms of Endorsement under IRC Section 408(b) for Flexible
Contribution Individual Retirement Annuity (38PP-90(IRA-1),
and (G.4333-15, G.4333 (IRA/ENH)--Forms R.S.1228 and
G.20247-568(7)
(b)(xiv) -- Form of Endorsement under IRC Section 403(b)
(G.4333-7)--Form G.20247.563(7)
(c) -- Form of IRC Section 408 Simplified Employee Pension Contract
(VestMet).(5)
(c)(i)(A) -- Form of IRC Section 408 Simplified Employee Pension Contract
(c)(i)(B) -- Amended Form of IRC Section 408 Simplified Employee Pension
Contract (Preference Plus).(5)
(Preference Plus) (Version 2).(5)
</TABLE>
II-2
<PAGE>
<TABLE>
<S> <C>
(c)(i)(C) -- Form of IRC Section 408 Simplified Employee Pension Contract
(Preference Plus) (Oregon).(2)
(c)(i) -- Form of IRC Section 408 Simplified Employee Pension Contract
(Illinois, Minnesota) (VestMet).(5)
(c)(ii) -- Form of IRC Section 408 Simplified Employee Pension Contract
(Michigan) (VestMet).(5)
(c)(iii) -- Form of IRC Section 408 Simplified Employee Pension Contract
(New York) (VestMet).(5)
(c)(iv) -- Form of IRC Section 408 Simplified Employee Pension Contract
(South Carolina) (VestMet).(5)
(c)(v) -- Form of IRC Section 408 Simplified Employee Pension Contract
(Pennsylvania) (VestMet).(5)
(c)(vi) -- Form of IRC Section 408 Simplified Employee Pension Contract
(Washington) (VestMet).(5)
(c)(vii) -- Information Statement concerning IRC Section 408 Simplified
Employee Pension Contract (VestMet).(5)
(d) -- Form of IRC Section 408 Individual Retirement Annuity
Contract (VestMet).(5)
(d)(i)(A) -- Form of IRC Section 408 Individual Retirement Annuity
Contract (Preference Plus) (Version 2).(5)
(d)(i)(B) -- Form of IRC Section 408 Individual Retirement Annuity
Contract (Preference Plus).(5)
(d)(i)(C) -- Form of IRC Section 408 Individual Retirement Annuity
Contract (Preference Plus) (Oregon).(2)
(d)(i) -- Form of Endorsement to IRC Section 408 Individual Retirement
Annuity Contract (VestMet).(5)
(d)(ii) -- Form of Endorsement to IRC Section 408 Individual Retirement
Annuity Contract (Michigan) (VestMet).(5)
(d)(iii) -- Form of IRC Section 408 Individual Retirement Annuity
Contract (Illinois, Minnesota) (VestMet).(5)
(d)(iv) -- Form of IRC Section 408 Individual Retirement Annuity
Contract (Michigan) (VestMet).(5)
(d)(v) -- Form of IRC Section 408 Individual Retirement Annuity
Contract (New York) (VestMet).(5)
(d)(vi) -- Form of IRC Section 408 Individual Retirement Annuity
Contract (South Carolina) (VestMet).(5)
(d)(vii) -- Form of IRC Section 408 Individual Retirement Annuity
Contract (Pennsylvania) (VestMet).(5)
(d)(viii) -- Form of IRC Section 408 Individual Retirement Annuity
Contract (Washington) (VestMet).(5)
(d)(ix) -- Information Statement concerning IRC Section 408 Individual
Retirement Annuity Contract (VestMet).(5)
(d)(x) -- Form of Endorsement to IRC Section 408 Individual Retirement
Annuity Contract (VestMet).(5)
(d)(xi) -- Form of Endorsement to IRC Section 408 Individual Retirement
Annuity Contract (Michigan) (VestMet).(5)
(d)(xii) -- Form of Endorsement to IRC Section 408 Individual Retirement
Annuity Contract (South Carolina) (VestMet).(5)
(d)(xiii) -- Form of Endorsement to IRC Section 408 Individual Annuity
Contract (Preference Plus).(4)
(e) -- Amended Form of IRC Section 408 Group Individual Retirement
Annuity Contract (VestMet).(5)
(e)(1) -- Form of IRC Section 408 Group Individual Retirement Annuity
Contract (Preference Plus).(5)
(e)(i) -- Form of Certificate under IRC Section 408 Group Individual
Retirement Annuity Contract (VestMet).(5)
(e)(i)(A) -- Form of Certificate under IRC Section 408 Group Individual
Retirement Annuity Contract (Preference Plus).(5)
(e)(i)(B) -- Forms of Certificate under IRC Section 408 Group Individual
Retirement Annuity Contract (Enhanced).(2,5)
</TABLE>
II-3
<PAGE>
<TABLE>
<S> <C>
(e)(i)(C) -- Form of Certificate under IRC Section 408 Group Individual
Retirement Annuity Contract (Oregon).(2)
(f) -- Amended Form of IRC Section 457 Group Annuity Contract for
Public Employee Deferred Compensation Plans (VestMet).(5)
(f)(i) -- Form of IRC Section 457 Group Annuity Contract for Public
Employee Deferred Compensation Plans (Preference Plus)
(Version 2).(5)
(f)(ii) -- Amended Form of IRC Section 457 Group Annuity Contract for
Public Employee Deferred Compensation Plans (Preference
Plus).(5)
(f)(iii) -- Form of IRC Section 457 Group Annuity Contract for Public
Employee Deferred Compensation Plans (Enhanced Preference
Plus).(5)
(f)(iv) -- Form of IRC Section 457 Group Annuity Contract for Public
Employee Deferred Compensation Plans (Financial Freedom).(5)
(f)(v) -- Form of IRC Section 457 Group Annuity Contract for Public
Employee Deferred Compensation Plans (Enhanced Preference
Plus).(4)
(f)(vi) -- Form of Endorsement under IRC Section 457(b) for Public
Employee Deferred Compensation Plans (G.3068) (Preference
Plus)--Form G.7812-45(7)
(g) -- Form of Endorsement to IRC Section 408 Individual Retirement
Annuity Contract which Converts Contract into Non-Qualified
Status (VestMet).(5)
(g)(1) -- Form of Non-Qualified Contract (Preference Plus) (Version
2).(5)
(g)(i)(A) -- Amended Form of Non-Qualified Contract (Preference Plus).(5)
(g)(i)(B) -- Form of Non-Qualified Contract (Preference Plus)
(Oregon).(2)
(g)(i) -- Information Statement concerning IRC Section 408 Individual
Retirement Annuity Contract with Non-Qualified Endorsement
(VestMet).(5)
(g)(ii) -- Form of Endorsement to IRC Section 408 Individual Retirement
Annuity Contract with Non-Qualified Endorsement (Michigan)
(VestMet).(5)
(g)(iii) -- Form of Endorsement to IRC Section 408 Individual Retirement
Annuity Contract with Non-Qualified Endorsement (South
Carolina) (VestMet).(5)
(g)(iv) -- Form of Endorsement to Group Annuity Contract.(5)
(h) -- Amended Form of Non-Qualified Group Contract (VestMet).(5)
(h)(1) -- Form of Non-Qualified Group Contract (Preference Plus).(5)
(h)(i) -- Form of Certificate under Non-Qualified Group Contract
(VestMet).(5)
(h)(i)(A) -- Forms of Certificate under Non-Qualified Group Contract
(Preference Plus).(5)
(h)(i)(A)(i) -- Form of Certificate under Non-Qualified Group Contract
(Preference Plus-Enhanced Contract; Enhanced Preference
Plus).(2)
(h)(i)(A)(ii) -- Form of Certificate under Non-Qualified Group Contract
(Preference Plus-Enhanced Contract; Enhanced Preference
Plus) (Oregon).(2)
(h)(i)(B) -- Form of Non-Qualified Group Contract (Preference Plus).(5)
(h)(i)(C) -- Form of Non-Qualified Group Contract (Enhanced Preference
Plus).(5)
(h)(i)(D) -- Form of Endorsement Concerning Nursing Home or Terminal
Illness.(2)
(h)(i)(E) -- Form of Endorsement for death claim settlement for
MT-(37PP-90(NQ-1), (38PP-90(IRA-)--Form R.S. 1234MT1998(7)
(h)(i)(F) -- Form of Non-Qualified Group Contract (Financial Freedom
Account) Form--G.3043(7)
(i) -- Endorsement with respect to Individual IRA and Individual
Non-Qualified Contract concerning Death Benefit Provisions
(VestMet).(5)
(j) -- Specimen of variable retirement annuity contract for
Metropolitan Variable Account B.(5)
(k) -- Proposed Form of Metropolitan Investment Annuity Program,
Form 37-74 MIAP for Metropolitan Life Variable Account C.(5)
(l) -- Proposed Form of Metropolitan Investment Annuity Program,
Form 37-74 MIAP for Metropolitan Life Variable Account D.(5)
</TABLE>
II-4
<PAGE>
<TABLE>
<S> <C>
(m) -- Specimen of Flexible-Purchase Variable Annuity Contract for
Metropolitan Variable Account A.(1)
(n) -- Specimen of Variable Annuity Contract, Forms 37TV-65 and
20SV-65 for Metropolitan Variable Account B.(5)
(o) -- Form of Certificate under IRC Section 403(a) Group Annuity
Contract (Preference Plus).(5)
(o)(i) -- Forms of Certificate under IRC Section 403(a) Group Annuity
Contract (Financial Freedom).(5)
(o)(ii) -- Form of Certificate under IRC Section 403(a) Group Annuity
Contract (South Carolina).(5)
(o)(iii) -- Form of Certificate under IRC Section 403(a) Group Annuity
Contract (SUNY).(5)
(o)(iv) -- Form of Certificate under IRC Section 403(a) Group Annuity
Contract (Oregon).(2)
(p) -- Form of Single Premium Immediate Income Payment Contract
(Preference Plus).(5)
(q) -- Form of Single Premium Immediate Income Payment Certificate
(Enhanced Preference Plus and Financial Freedom).(5)
(r) -- Endorsements for Single Premium Immediate Income Payment
Contract.(5)
(r)(i) -- Form of Endorsement for Single Premium Immediate Income
Payment Contract (G.4333(VARPAY)--Form G.20247-560(7)
(s) -- Form of Endorsement with respect to the Roth Individual
Retirement Annuity--Form R.S. 1220-PPA(6)
(s)(i) -- Form of Endorsement with respect to the Roth Individual
Retirement Annuity--Form R.S. 1220-PPA (Minnesota).(6)
(s)(ii) -- Form of Endorsement with respect to the Roth Individual
Retirement Annuity--Form R.S. 1220-PPA (New Jersey).(6)
(s)(iii) -- Form of Amendment with respect to the Roth Individual
Retirement Annuity--Form R.S. 1212-PPA.(6)
(s)(iv) -- Form of Amendment with respect to the Roth Individual
Retirement Annuity--Form R.S. 1212-PPA (Minnesota).(6)
(s)(v) -- Form of Amendment with respect to the Roth Individual
Retirement Annuity--Form R.S. 1212-PPA (New Jersey).(6)
(t) -- Form of Group Annuity Contract and Amendment under IRC
Section 415(m)--Forms G. 3043A and G. 3043A-1 (Financial
Freedom Account).(6)
(u) -- Form of Endorsement with respect to Waiver of Administrative
Fee--Form R.S. 1206.(6)
(v) -- Forms of Endorsement with respect to exchange from Growth
Plus Account to the Preference Plus Account--Form RSC
E31910-2.(6)
(w) -- Forms of Endorsement with respect to Enhanced 10% corridor
(37PP-90(NQ-1), 38PP-90 (IRA-1) NQ/IRA, NJ PPA and
(PSC94-05)--Forms R.S. 1222, R.S.1222N.J., R.S. 1232 and G.
20247-573(7)
(x) -- Forms of Endorsement with respect to Fund Expansion
(38PP-90(NQ-1), (38PP-90(IRA-1), TSA/403(a), PPI immediate
(PSC 93-05A)--Forms R.S. 1230 (11/98), G 20247-572 and R.S.
1231 (11/98)(7)
(y) -- Forms of Endorsement with respect to Exchange
(37PP-90(NQ-1), 38PP-90(IRA-1) and (G.4333-7)--Forms
E31910-3 and G.7812-38-1(7)
(z) -- Forms of Endorsement for SIMPLE IRA (G.4333-15) and
(G.4333-15+RSC 96-37)--Forms RSC 96-37 and R.S.1209(7)
(5)(a) -- Participation Request and Agreement for the IRC Section 401
Group Annuity Contract.(5)
(b) -- Enrollment Form with respect to the IRC Section 401 Group
Annuity Contract.(5)
(b)(i) -- Enrollment Form with respect to the IRC Section 401 Group
Annuity Contract (Preference Plus) (Allocated).(5)
(c) -- Participation Request and Agreement for the IRC
Section 403(b) Group Annuity Contract.(5)
(c)(i) -- Participation Request and Agreement for the IRC
Section 403(b) Group Annuity Contract (Direct Mail Form).(5)
</TABLE>
II-5
<PAGE>
<TABLE>
<S> <C>
(d) -- Enrollment Form with respect to the IRC Section 403(b) Group
Contract and the IRC Section 457 Group Annuity Contract.(2)
(d)(i) -- 403(b) Tax Deferred Annuity Customer Agreement
Acknowledgement.(5)
(d)(ii) -- Enrollment Form with respect to the IRC Section 403(b) Group
Annuity Contract (Enhanced Preference Plus TSA).(5)
(d)(iii) -- Enrollment Form with respect to the IRC Section 403(b) Group
Annuity Contract (FFA-TSA).(5)
(e) -- Enrollment Form with respect to the IRC Section 403(b) Group
Annuity Contract and the IRC Section 457 Group Annuity
Contract.(5)
(f) -- Application for an IRC Section 408 Simplified Employee
Pension, IRA and Non-Qualified Deferred Annuities
(Preference Plus).(2)
(f)(i) -- Application for Individual IRA and Non-Qualified Contract
(Direct Mail Form).
(g) -- Employer Adoption Request Form.(5)
(g)(i) -- Employer Utilization Request Form.(5)
(g)(ii) -- Enrollment Form for IRC Section 408 Group Individual
Retirement Account Contract and Non-Qualified Group
Contract.(5)
(g)(iii) -- Funding Authorization and Agreement.(5)
(g)(iv) -- Funding Authorization and Agreement (SEP).(5)
(h)(i) -- Enrollment Form for IRC Section 408 Individual Retirement
Annuity, IRC Section 408k Simplified Employee Pension and
Non-Qualified Income Annuity Contract.(5)
(h)(ii) -- Enrollment Form for IRC Sections 403(b), 403(a) and 457
Group Income Annuity Contract.(5)
(h)(iii) -- Enrollment Form for Group IRA Rollover Annuity (Preference
Plus-Enhanced Contract).(2)
(h)(iv) -- Enrollment Form for Group Non-Qualified Supplemental Savings
(Preference Plus-Enhanced Contract).(2)
(i) -- Application for Variable Annuity (Preference
Plus(Registered) Account) TSA/IRC Section 457(b) Deferred
Compensation/IRC Section 403(a) for form G.4333-7
FORM--038-PPA-TSA/PEDC (0998)(7)
(i)(i) -- Application for Variable Annuity (Preference
Plus(Registered) Account) for 37PP-90 (NQ-1), 38PP-90
(IRA-1) FORM--038-PPA-IRA/SEP/NQ (0998)(7)
(i)(ii) -- Application for the Preference Plus(Registered) Income
Annuity for RSC 93-05A FORM--RSCINCAPNQIRASEP (10/98)(7)
(i)(iii) -- Application for Variable Annuity Enhanced Preference
Plus(Registered) Account for MetLife Employees for forms
G.4333-14, G.4333-15 Form--038MEGPPAIRA/NQ(10/98)(7)
(6) -- Charter and By-Laws of Metropolitan Life.(2)
(6)(a) -- By-Laws Amendment.(2)
(7) -- Not applicable.
(8) -- Not applicable.
(9) -- Opinion and consent of counsel as to the legality of the
securities being registered.(5)
(10) -- Not applicable.
(11) -- Not applicable.
(12) -- Not applicable.
(13)(a) -- Powers of Attorney.(2,4,5)
</TABLE>
- ------------------
1. Previously filed with the initial filing of the Registration Statement of
Metropolitan Variable Account A of Metropolitan Life Insurance Company on May
28, 1969.
(Footnotes continued on next page)
II-6
<PAGE>
(Footnotes continued from previous page)
2. Filed with Post-Effective Amendment No. 19 to this Registration Statement on
Form N-4 on February 27, 1996. Power of attorney for Ruth J. Simmons was also
filed.
3. Filed with Post-Effective Amendment No. 20 to this Registration Statement on
Form N-4 on April 29, 1996.
4. Filed with Post-Effective Amendment No. 21 to this Registration Statement on
Form N-4 on February 28, 1997. Powers of attorney for Gerald Clark, Burton A.
Dole, Jr. and Charles H. Leighton were also filed.
5. Filed with Post-Effective Amendment No. 22 to this Registration Statement on
Form N-4 on April 30, 1997.
6. Filed with Post-Effective Amendment No. 23 to this Registration Statement on
Form N-4 on April 3, 1998. Including powers of Attorney for Robert H.
Benmosche, Jon F. Danski and Stewart G. Nagler.
7. Filed herewith.
ITEM 25. DIRECTORS AND OFFICERS OF THE DEPOSITOR.
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION & POSITIONS AND OFFICES
NAME BUSINESS ADDRESS WITH DEPOSITOR
- ------------------------- ---------------------------------------- ---------------------
<S> <C> <C>
Curtis H. Barnette....... Chairman and Chief Executive Officer, Director
Bethlehem Steel Corporation,
1170 Eighth Avenue,
Martin Tower 2118,
Bethlehem, PA 18016-7699.
Robert H. Benmosche...... Chairman of the Board, President and President, Chairman
Chief Executive Officer, of the Board and
Metropolitan Life Insurance Company, Chief Executive
One Madison Avenue, Officer
New York, NY 10010.
Gerald Clark............. Vice-Chairman of the Board and Vice-Chairman of the
Chief Investment Officer, Board and Chief
Metropolitan Life Insurance Company, Investment Officer
One Madison Avenue,
New York, NY 10010.
Joan Ganz Cooney......... Chairman, Executive Committee, Director
Children's Television Workshop,
One Lincoln Plaza,
New York, NY 10023.
Burton A. Dole, Jr....... Retired Chairman, President and Director
Chief Executive Officer,
Nellcor Puritan Bennett,
2200 Faraday Avenue,
Carlsbad, CA 92008-7208.
James R. Houghton........ Chairman Emeritus of the Board Director
and Director,
Corning Incorporated,
80 East Market Street, 2nd Floor,
Corning, NY 14830.
Harry P. Kamen........... Retired Chairman and Chief Executive Director
Officer,
Metropolitan Life Insurance Company,
One Madison Avenue,
New York, NY 10010.
</TABLE>
II-7
<PAGE>
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION & POSITIONS AND OFFICES
NAME BUSINESS ADDRESS WITH DEPOSITOR
- ------------------------- ---------------------------------------- ---------------------
<S> <C> <C>
Helene L. Kaplan......... Of Counsel, Skadden, Arps, Slate, Director
Meagher and Flom,
919 Third Avenue,
New York, NY 10022.
Charles H. Leighton...... Retired Chairman of the Board, Director
CML Group, Inc.,
524 Main Street,
Bolton, MA 01720.
Allen E. Murray.......... Retired Chairman of the Board and Director
Chief Executive Officer,
Mobil Corporation,
375 Park Avenue, Suite 2901,
New York, NY 10152.
Stewart G. Nagler........ Vice-Chairman of the Board and Vice-Chairman of the
Chief Financial Officer, Board and Chief
Metropolitan Life Insurance Company, Financial Officer
One Madison Avenue,
New York, NY 10010.
John J. Phelan, Jr....... Retired Chairman and Director
Chief Executive Officer,
New York Stock Exchange,
P.O. Box 312,
Mill Neck, NY 11765.
Hugh B. Price............ President and Chief Executive Officer, Director
National Urban League, Inc.,
120 Wall Street, 7th & 8th Floors,
New York, NY 10005.
Robert G. Schwartz....... Retired Chairman of the Board, Director
President and Chief Executive Officer,
Metropolitan Life Insurance Company,
200 Park Avenue, Suite 5700,
New York, NY 10166.
Ruth J. Simmons, Ph.D.... President, Director
Smith College,
College Hall 20,
Northhampton, MA 01063.
William C. Steere, Jr.... Chairman of the Board and Director
Chief Executive Officer,
Pfizer, Inc.,
235 East 42nd Street,
New York, NY 10016
</TABLE>
Set forth below is a list of certain principal officers of Metropolitan
Life. The principal business address of each officer of Metropolitan Life is One
Madison Avenue, New York, New York 10010.
<TABLE>
<CAPTION>
NAME OF OFFICER POSITION WITH METROPOLITAN LIFE
- ------------------------------ -------------------------------------------------
<S> <C>
Robert H. Benmosche........... Chairman of the Board, Chief Executive Officer
and President
Gerald Clark.................. Vice-Chairman of the Board and Chief Investment
Officer
</TABLE>
II-8
<PAGE>
<TABLE>
<CAPTION>
NAME OF OFFICER POSITION WITH METROPOLITAN LIFE
- ------------------------------ -------------------------------------------------
<S> <C>
Stewart G. Nagler............. Vice-Chairman of the Board and Chief Financial
Officer
Gary A. Beller................ Senior Executive Vice-President and General
Counsel
C. Robert Henrikson........... Senior Executive Vice-President
Catherine A. Rein............. Senior Executive Vice-President
William J. Toppeta............ Senior Executive Vice-President
Jeffrey J. Hodgman............ Executive Vice-President
Terence I. Lennon............. Executive Vice-President
David A. Levene............... Executive Vice-President
John H. Tweedie............... Executive Vice-President
Judy E. Weiss................. Executive Vice-President and Chief Actuary
Richard M. Blackwell.......... Senior Vice-President
Alexander D. Brunini.......... Senior Vice-President
Jon F. Danski................. Senior Vice-President and Controller
James B. Digney............... Senior Vice-President
William T. Friedewald, M.D.... Senior Vice-President
Ira Friedman.................. Senior Vice-President
Anne E. Hayden................ Senior Vice-President
Sibyl C. Jacobson............. Senior Vice-President
Joseph W. Jordan.............. Senior Vice-President
Kernan F. King................ Senior Vice-President
Nicholas D. Latrenta.......... Senior Vice-President
Leland C. Launer, Jr.......... Senior Vice-President
Gary E. Lineberry............. Senior Vice-President
James L. Lipscomb............. Senior Vice-President
William D. Livesey............ Senior Vice-President
James M. Logan................ Senior Vice-President
Eugene Marks, Jr.............. Senior Vice-President
William R. Prueter............ Senior Vice-President
Joseph A. Reali............... Senior Vice-President
Vincent P. Reusing............ Senior Vice-President
Felix Schirripa............... Senior Vice-President
James M. Benson............... President and Chief Executive Officer--The New
England Insurance Company
Robert E. Sollmann, Jr........ Senior Vice-President
Thomas L. Stapleton........... Senior Vice-President and Tax Director
James F. Stenson.............. Senior Vice-President
Stanley J. Talbi.............. Senior Vice-President
Richard R. Tartre............. Senior Vice-President
James A. Valentino............ Senior Vice-President
Lisa Weber.................... Senior Vice-President
William J. Wheeler............ Senior Vice-President and Treasurer
Anthony J. Williamson......... Senior Vice-President
Louis J. Ragusa............... Vice-President and Secretary
</TABLE>
II-9
<PAGE>
ITEM 26. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE DEPOSITOR OR
REGISTRANT.
The registrant is a separate account of Metropolitan Life Insurance Company
under the New York Insurance law. Under said law the assets allocated to the
separate account are the property of Metropolitan Life Insurance Company. No
person has the direct or indirect power to control Metropolitan Life Insurance
Company. As a mutual life insurance company, Metropolitan Life Insurance Company
has no stockholders. Its Board of Directors is elected in accordance with New
York Insurance Law by Metropolitan's policyholders, whose policies or contracts
have been in force for at least one year. Each such policyholder has only one
vote, irrespective of the number of policies or contracts held and the amount
thereof. The following outline indicates those persons who are controlled by or
under common control with Metropolitan Life Insurance Company:
II-10
<PAGE>
[The Organization Chart has been filed by module and is 11 pages long.
Part II will continue on page II-22.]
<PAGE>
ORGANIZATIONAL STRUCTURE OF METROPOLITAN AND SUBSIDIARIES
AS OF DECEMBER 31, 1998
The following is a list of subsidiaries of Metropolitan Life Insurance Company
("Metropolitan") as of December 31, 1998. Those entities which are listed at
the left margin (labelled with capital letters) are direct subsidiaries of
Metropolitan. Unless otherwise indicated, each entity which is indented under
another entity is a subsidiary of such indented entity and, therefore, an
indirect subsidiary of Metropolitan. Certain inactive subsidiaries have been
omitted from the Metropolitan Organizational listing. The voting securities
(excluding directors' qualifying shares, if any) of the subsidiaries listed are
100% owned by their respective parent corporations, unless otherwise indicated.
The jurisdiction of domicile of each subsidiary listed is set forth in the
parenthetical following such subsidiary.
A. Metropolitan Tower Corp. (Delaware)
1. Metropolitan Property and Casualty Insurance Company (Rhode Island)
a. Metropolitan Group Property and Casualty Insurance Company
(Rhode Island)
i. Metropolitan Reinsurance Company (U.K.) Limited (Great
Britain)
b. Metropolitan Casualty Insurance Company (Rhode Island)
c. Metropolitan General Insurance Company (Rhode Island)
d. Metropolitan Direct Property and Casualty Insurance Company
(Georgia)
e. Metropolitan P&C Insurance Services, Inc. (California)
f. Metropolitan Lloyds, Inc. (Texas)
g. Met P&C Managing General Agency, Inc. (Texas)
2. Metropolitan Insurance and Annuity Company (Delaware)
a. MetLife Europe I, Inc. (Delaware)
b. MetLife Europe II, Inc. (Delaware)
c. MetLife Europe III, Inc. (Delaware)
d. MetLife Europe IV, Inc. (Delaware)
e. MetLife Europe V, Inc. (Delaware)
3. MetLife General Insurance Agency, Inc. (Delaware)
a. MetLife General Insurance Agency of Alabama, Inc. (Alabama)
b. MetLife General Insurance Agency of Kentucky, Inc. (Kentucky)
c. MetLife General Insurance Agency of Mississippi, Inc.
(Mississippi)
d. MetLife General Insurance Agency of Texas, Inc. (Texas)
e. MetLife General Insurance Agency of North Carolina, Inc. (North
Carolina)
f. MetLife General Insurance Agency of Massachusetts, Inc.
(Massachusetts)
<PAGE>
4. Metropolitan Asset Management Corporation (Delaware)
(a.) MetLife Capital, Limited Partnership (Delaware).
Partnership interests in MetLife Capital, Limited
Partnership are held by Metropolitan (90%) and
Metropolitan Asset Management Corporation (10%).
(i.) MetLife Capital Credit L.P. (Delaware).
Partnership interests in MetLife Capital Credit
L.P. are held by Metropolitan (90%) and
Metropolitan Asset Management Corporation (10%).
(1) MetLife Capital CFLI Holdings, LLC (DE)
(a.) MetLife Capital CFLI Leasing, LLC
(DE)
b. MetLife Financial Acceptance Corporation (Delaware).
MetLife Capital Holdings, Inc. holds 100% of the voting
preferred stock of MetLife Financial Acceptance Corporation.
Metropolitan Property and Casualty Insurance Company holds
100% of the common stock of MetLife Financial Acceptance
Corporation.
c. MetLife Investments Limited (United Kingdom). 23rd Street
Investments, Inc. holds one share of MetLife Investments
Limited.
d. MetLife Investments Asia Limited (Hong Kong). One share of
MetLife Investments Asia Limited is held by W&C Services, Inc.,
a nominee of Metropolitan Asset Management Corporation.
5. SSRM Holdings, Inc. (Delaware)
a. GFM Investments Limited (Delaware)
b. State Street Research & Management Company (Delaware). Is a
sub-investment manager for the Growth, Income, Diversified
and Aggressive Growth Portfolios of Metropolitan Series
Fund, Inc.
i. State Street Research Investment Services, Inc.
(Massachusetts)
<PAGE>
c. SSR Realty Advisors, Inc. (Delaware)
i. Metric Management Inc. (Delaware)
ii. Metric Property Management, Inc. (Delaware)
(1) Metric Realty (Delaware). SSR Realty Advisors, Inc.
and Metric Property Management, Inc. each hold 50% of
the common stock of Metric Realty.
(a) Metric Institutional Apartment Fund II, L.P.
(California). Metric Realty holds a 1% interest
as general partner and Metropolitan holds an
approximately 14.6% limited partnership interest
in Metric Institutional Apartment Fund II, L.P.
(2) Metric Colorado, Inc. (Colorado). Metric Property
Management, Inc. holds 80% of the common stock of
Metric Colorado, Inc.
iii. Metric Capital Corporation (California)
iv. Metric Assignor, Inc. (California)
v. SSR AV, Inc. (Delaware)
6. MetLife Holdings, Inc. (Delaware)
a. MetLife Funding, Inc. (Delaware)
b. MetLife Credit Corp. (Delaware)
7. Metropolitan Tower Realty Company, Inc. (Delaware)
8. Met Life Real Estate Advisors, Inc. (California)
9. Security First Group, Inc. (DE)
a. Security First Life Insurance Company (DE)
b. Security First Insurance Agency, Inc. (MA)
c. Security First Insurance Agency, Inc. (NV)
d. Security First Group of Ohio, Inc. (OH)
e. Security First Financial, Inc. (DE)
f. Security First Investment Management Corporation (DE)
g. Security First Management Corporation (DE)
h. Security First Real Estate, Inc. (DE)
i. Security First Financial Agency, Inc. (TX)
10. Natiloportem Holdings, Inc. (Delaware)
B. Metropolitan Tower Life Insurance Company (Delaware)
C. MetLife Security Insurance Company of Louisiana (Louisiana)
<PAGE>
D. MetLife Texas Holdings, Inc. (Delaware)
1. Texas Life Insurance Company (Texas)
a. Texas Life Agency Services, Inc. (Texas)
b. Texas Life Agency Services of Kansas, Inc. (Kansas)
E. MetLife Securities, Inc. (Delaware)
F. 23rd Street Investments, Inc. (Delaware)
G. Services La Metropolitaine Quebec, Inc. (Quebec, Canada)
H. Santander Met, S.A. (Spain). Shares of Santander Met, S.A. are held by
Metropolitan (50%) and by an entity (50%) unaffiliated with Metropolitan.
1. Seguros Genesis, S.A. (Spain)
2. Genesis Seguros Generales, Sociedad Anomina de Seguros y Reaseguros
(Spain)
I. MetLife Saengmyoung Insurance Company Ltd. (Korea).
J. Metropolitan Life Seguros de Vida S.A. (Argentina)
K. Metropolitan Life Seguros de Retiro S.A. (Argentina).
L. Met Life Holdings Luxembourg (Luxembourg)
M. Metropolitan Life Holdings, Netherlands BV (Netherlands)
N. MetLife International Holdings, Inc. (Delaware)
O. Metropolitan Life Insurance Company of Hong Kong Limited (Hong Kong)
P. Metropolitan Marine Way Investments Limited (Canada)
Q. P.T. MetLife Sejahtera (Indonesia) Shares of P.T. MetLife Sejahtera are
held by Metropolitan (80%) and by an entity (20%) unaffiliated with
Metropolitan.
R. Seguros Genesis S.A. (Mexico) Metropolitan holds 85.49%, Metropolitan Tower
Corp. holds 7.31% and Metropolitan Asset Management Corporation holds 7.20%
of the common stock of Seguros Genesis S.A.
S. Metropolitan Life Seguros de Vida S.A. (Uruguay). One share of Metropolitan
Life Seguros de Vida S.A. is held by Alejandro Miller Artola, a nominee of
Metropolitan Life Insurance Company.
T. Metropolitan Life Seguros E Previdencia Privada S.A. (Brazil)
<PAGE>
U. Hyatt Legal Plans, Inc. (Delaware)
1. Hyatt Legal Plans of Florida, Inc. (Fl)
V. One Madison Merchandising L.L.C. (Connecticut) Ownership of membership
interests in One Madison Merchandising L.L.C. is as follows: Metropolitan
owns 99% and Metropolitan Tower Corp. owns 1%.
W. Metropolitan Realty Management, Inc. (Delaware)
1. Edison Supply and Distribution, Inc. (Delaware)
2. Cross & Brown Company (New York)
a. CBNJ, Inc. (New Jersey)
X. MetPark Funding, Inc. (Delaware)
Y. 2154 Trading Corporation (New York)
Z. Transmountain Land & Livestock Company (Montana)
AA. Farmers National Company (Nebraska)
1. Farmers National Commodities, Inc. (Nebraska)
2. Farmers National Marketing Group, LLC (Iowa) Ownership of membership
interests in Farmers National Marketing Group, LLC is as follows:
Farmers National Company (50%) and an entity unaffiliated with
Metropolitan (50%).
A.B. MetLife Trust Company, National Association. (United States)
A.C. Benefit Services Corporation (Georgia)
A.D. G.A. Holding Corporation (MA)
A.E. TNE-Y, Inc. (DE)
A.F. CRH., Inc. (MA)
A.G. NELRECO Troy, Inc. (MA)
A.H. TNE Funding Corporation (DE)
A.I. L/C Development Corporation (CA)
A.J. Boylston Capital Advisors, Inc. (MA)
1. New England Portfolio Advisors, Inc. (MA)
A.K. CRB Co., Inc. (MA) AEW Real Estate Advisors, Inc. holds 49,000 preferred
non-voting shares of CRB Co., Inc. AEW Advisors, Inc. holds 1,000
preferred non-voting shares of CRB Co., Inc.
A.L. New England Life Mortgage Funding Corporation (MA)
A.M. Mercadian Capital L.P. (DE). Metropolitan holds a 95% limited partner
interest and an unaffiliated third party holds 5% of Mercadian Capital
L.P.
A.N. Mercadian Funding L.P. (DE). Metropolitan holds a 95% limited partner
interest and an unaffiliated third party holds 5% of Mercadian
Funding L.P.
A.O. Tower Resources Group, Inc. (DE)
<PAGE>
A.P. MetLife New England Holdings, Inc. (DE)
1. Fulcrum Financial Advisors, Inc. (MA)
2. New England Life Insurance Company (MA)
a. New England Life Holdings, Inc. (DE)
i. New England Securities Corporation (MA)
(1) Hereford Insurance Agency, Inc. (MA)
(2) Hereford Insurance Agency of Alabama, Inc. (AL)
(3) Hereford Insurance Agency of Minnesota, Inc. (MN)
(4) Hereford Insurance Agency of Ohio, Inc. (OH)
(5) Hereford Insurance Agency of New Mexico, Inc. (NM)
ii. TNE Advisers, Inc. (MA)
iii. TNE Information Services, Inc. (MA)
(1) First Connect Insurance Network, Inc. (DE)
(2) Interative Financial Solutions, Inc. (MA)
iv. N.L. Holding Corp. (Del)(NY)
(1) Nathan & Lewis Securities, Inc. (NY)
(2) Nathan & Lewis Associates, Inc. (NY)
(a) Nathan and Lewis Insurance Agency of Massachusetts,
Inc. (MA)
(b) Nathan and Lewis Associates of Texas, Inc. (TX)
(3) Nathan & Lewis Associates--Arizona, Inc. (AZ)
(4) Nathan & Lewis of Nevada, Inc. (NV)
(5) Nathan and Lewis Associates Ohio, Incorporated (OH)
b. Exeter Reassurance Company, Ltd. (MA)
c. Omega Reinsurance Corporation (AZ)
d. New England Pension and Annuity Company (DE)
e. Newbury Insurance Company, Limited (Bermuda)
3. Nvest Corporation (MA)
a. Nvest, L.P. (DE) Nvest Corporation holds a 1.69% general partnership
interest and MetLife New England Holdings, Inc. 3.19% general
partnership interest in Nvest, L.P.
b. Nvest Companies, L.P. (DE) Nvest Corporation holds a 0.0002% general
partnerhship interest in Nvest Companies, L.P. Nvest, L.P. holds a
14.64% general partnership interest in Nvest Companies, L.P.
Metropolitan holds a 46.23% limited partnership interest in Nvest
Companies, L.P.
i. Nvest Holdings, Inc. (DE)
(1) Back Bay Advisors, Inc. (MA)
(a) Back Bay Advisors, L.P. (DE)
Back Bay Advisors, Inc.
holds a 1% general partner
interest and NEIC
Holdings, Inc. holds a 99%
limited partner interest
in Back Bay Advisors, L.P.
(2) R & T Asset Management, Inc. (MA)
(a) Reich & Tang Distributors, Inc. (DE)
(b) R & T Asset Management L.P.
R & T Asset Management, Inc.
holds a 0.5% general partner interest and
NEIC Holdings, Inc. hold a 99.5% limited
partner interest in &
Asset Management, L.P.
(c) Reich & Tang Services, Inc. (DE)
<PAGE>
(3) Loomis, Sayles & Company, Inc. (MA)
(a) Loomis Sayles & Company, L.P. (DE)
Loomis Sayles & Company, Inc.
holds a 1% general partner interest and
R & T Asset Management, Inc. holds a 99%
limited partner interest in Loomis Sayles &
Company, L.P.
(4) Westpeak Investment Advisors, Inc. (MA)
(a) Westpeak Investment Advisors, L.P. (DE)
Westpeak Investment Advisors, Inc.
holds a 1% general partner interest and
Reich & Tang holds a 99% limited
partner interest in Westpeak Investment
Advisors, L.P.
(i) Westpeak Investment Advisors Australia
Limited Pty.
(5) Vaughan, Nelson Scarborough & McCullough (DE)
(a) Vaughan, Nelson Scarborough & McCullough, L.P. (DE)
VNSM, Inc. holds a 1% general partner interest and
Reich & Tang Asset Management, Inc. holds a 99%
limited partner interest in Vaughan, Nelson
Scarborough & McCullough, L.P.
(i) VNSM Trust Company
(6) MC Management, Inc. (MA)
(a) MC Management, L.P. (DE)
MC Management, Inc. holds a 1% general partner
interest and R & T Asset Management, Inc.
holds a 99% limited partner interest in MC
Management, L.P.
(7) Harris Associates, Inc. (DE)
(a) Harris Associates Securities L.P. (DE)
Harris Associates, Inc. holds a 1% general partner
interest and Harris Associates L.P. holds a
99% limited partner interest in Harris Associates
Securities, L.P.
(b) Harris Associates L.P. (DE)
Harris Associates, Inc. holds a 0.33% general
partner interest and NEIC Operating Partnership,
L.P. holds a 99.67% limited partner interest in
Harris Associates L.P.
(i) Harris Partners, Inc. (DE)
(ii) Harris Partners L.L.C. (DE)
Harris Partners, Inc. holds a 1%
membership interest and
Harris Associates L.P. holds a 99%
membership interest in Harris Partners L.L.C.
(1) Aurora Limited Partnership (DE)
Harris Partners L.L.C. holds a 1% general
partner interest
<PAGE>
(2) Perseus Partners L.P. (DE) Harris Partners
L.L.C. holds a 1% general partner interest
(3) Pleiades Partners L.P. (DE) Harris
Partners L.L.C. holds a 1% general partner
interest
(4) Stellar Partners L.P. (DE)
Harris Partners L.L.C. holds a 1% general
partner interest
(5) SPA Partners L.P. (DE) Harris Partners
L.L.C. holds a 1% general partner interest
(8) Graystone Partners, Inc. (MA)
(a) Graystone Partners, L.P. (DE)
Graystone Partners, Inc. holds a 1%
general partner interest and New England
NEIC Operating Partnership, L.P.
holds a 99% limited partner interest in
Graystone Partners, L.P.
(9) NEF Corporation (MA)
(a) New England Funds, L.P. (DE) NEF Corporation holds a
1% general partner interest and NEIC Operating
Partnership, L.P. holds a 99% limited
partner interest in New England Funds, L.P.
(b) New England Funds Management, L.P. (DE) NEF
Corporation holds a 1% general partner interest and
NEIC Operating Partnership, L.P. holds a 99%
limited partner interest in New England Funds
Management, L.P.
(10) New England Funds Service Corporation
(11) AEW Capital Management, Inc. (DE)
(a) AEW Securities, L.P. (DE) AEW Capital Management, Inc. holds
a 1% general partnership and AEW Capital Management, L.P.
holds a 99% limited partnership interest in AEW Securities,
L.P.
ii. Nvest Associates, Inc.
iii. Snyder Capital Management, Inc.
(1) Snyder Capital Management, L.P. NEIC Operating
Partnership holds a 99.5% limited partnership
interest and Snyder Capital Management Inc. holds a
0.5% general partnership interest.
iv. Jurika & Voyles, Inc.
(1) Jurika & Voyles, L.P NEIC Operating Partnership,
L.P. holds a 99% limited partnership interest and
Jurika & Voyles, Inc. holds a 1% general partnership
interest.
v. Capital Growth Management, L.P. (DE)
NEIC Operating Partnership, L.P. holds a 50% limited partner
interest in Capital Growth Management, L.P.
vi. Nvest Partnerships, LLC ( )
<PAGE>
vii. AEW Capital Management L.P. (DE)
New England Investment Companies, L.P. holds a 99% limited partner
interest and AEW Capital Management, Inc. holds a 1% general
partner interest in AEW Capital Management, L.P.
(1) AEW II Corporation ( )
(2) AEW Partners III, Inc. ( )
(3) AEW TSF, Inc. ( )
(4) AEW Exchange Management, LLC
(5) AEWPN, LLC ( )
(6) AEW Investment Group, Inc. (MA)
(a) Copley Public Partnership Holding, L.P. (MA)
AEW Investment Group, Inc. holds a 25% general partnership
interest and AEW Capital Management, L.P. holds a 75%
limited partnership interest in Copley Public Partnership
Holding, L.P.
(b) AEW Management and Advisors L.P. (MA)
AEW Investment Group, Inc. holds a 25% general partnership
interest and AEW Capital Management, L.P. holds a 75% limited
partnership interest in AEW Management and Advisors L.P.
ii. AEW Real Estate Advisors, Inc. (MA)
1. AEW Advisors, Inc. (MA)
2. Copley Properties Company, Inc. (MA)
3. Copley Properties Company II, Inc. (MA)
4. Copley Properties Company III, Inc. (MA)
5. Fourth Copley Corp. (MA)
6. Fifth Copley Corp. (MA)
7. Sixth Copley Corp. (MA)
8. Seventh Copley Corp. (MA).
9. Eighth Copley Corp. (MA).
10. First Income Corp. (MA).
11. Second Income Corp. (MA).
12. Third Income Corp. (MA).
13. Fourth Income Corp. (MA).
14. Third Singleton Corp. (MA).
15. Fourth Singleton Corp. (MA)
16. Fifth Singleton Corp. (MA)
17. Sixth Singleton Corp. (MA).
18. BCOP Associates L.P. (MA)
AEW Real Estate Advisors, Inc. holds a 1% general
partner interest in BCOP Associates L.P.
ii. CREA Western Investors I, Inc. (MA)
1. CREA Western Investors I, L.P. (DE)
CREA Western Investors I, Inc. holds a 24.28% general
partnership interest and Copley Public Partnership Holding,
L.P. holds a 57.62% limited partnership interest in CREA
Western Investors I, L.P.
iii. CREA Investors Santa Fe Springs, Inc. (MA)
(7) Copley Public Partnership Holding, L.P. (DE)
AEW Capital Management, L.P. holds a 75% limited partner interest and
AEW Investment Group, Inc. holds a 25% general partner interest and
CREA Western Investors I, L.P holds a 57.62% Limited Partnership
interest.
<PAGE>
(8) AEW Real Estate Advisors, Limited Partnership (MA)
AEW Real Estate Advisors, Inc. holds a 25% general partnership interest
and AEW Capital Management, L.P. holds a 75% limited partnership
interest in AEW Real Estate Advisors, Limited Partnership.
(9) AEW Hotel Investment Corporation (MA)
(a.) AEW Hotel Investment, Limited Partnership (MA)
AEW Hotel Investment Corporation holds a 1% general
partnership interest and AEW Capital Management, L.P. holds a
99% limited partnership interest in AEW Hotel Investment,
Limited Partnership.
(10) Aldrich Eastman Global Investment Strategies, LLC (DE)
AEW Capital Management, L.P. holds a 25% membership interest and an
unaffiliated third party holds a 75% membership interest in Aldrich
Eastman Global Investment Strategies, LLC.
In addition to the entities listed above, Metropolitan (or where indicated an
affiliate) also owns an interest in the following entities, among others:
1) CP&S Communications, Inc., a New York corporation, holds federal radio
communications licenses for equipment used in Metropolitan owned facilities and
airplanes. It is not engaged in any business.
2) Quadreal Corp., a New York corporation, is the fee holder of a parcel of
real property subject to a 999 year prepaid lease. It is wholly owned by
Metropolitan, having been acquired by a wholly owned subsidiary of Metropolitan
in 1973 in connection with a real estate investment and transferred to
Metropolitan in 1988.
3) Met Life International Real Estate Equity Shares, Inc., a Delaware
corporation, is a real estate investment trust. Metropolitan owns approximately
18.4% of the outstanding common stock of this company and has the right to
designate 2 of the 5 members of its Board of Directors.
4) Metropolitan Structures is a general partnership in which Metropolitan owns
a 50% interest.
5) Metropolitan owns, via its subsidiary, AFORE Genesis Metropolitan S.A. de
C.V., approximately 61.7% of SIEFORE Genesis S.A. de C.V., a mutual fund.
6) Metropolitan owns varying interests in certain mutual funds distributed by
its affiliates. These ownership interests are generally expected to decrease as
shares of the funds are purchased by unaffiliated investors.
7) Metropolitan Lloyds Insurance Company of Texas, an affiliated association,
provides homeowner and related insurance for the Texas market. It is an
association of individuals designated as underwriters. Metropolitan Lloyds,
Inc., a subsidiary of Metropolitan Property and Casualty Insurance Company ("MET
P&C"), serves as the attorney-in-fact and manages the association.
8) Metropolitan directly owns 100% of the non-voting preferred stock of Nathan
and Lewis Associates Ohio, Incorporated, an insurance agency. 100% of the voting
common stock of this company is held by an individual who has agreed to vote
such shares at the direction of N.L. Holding Corp. (DEL), an indirect wholly
owned subsidiary of Metropolitan.
<PAGE>
9) 100% of the capital stock of Hereford Insurance Agency of Oklahoma, Inc.
(OK) is owned by an officer. New England Life Insurance Company controls the
issuance of additional stock and has certain rights to purchase such officer's
shares.
10) 100% of the capital stock of Fairfield Insurance Agency of Texas, Inc. (TX)
is owned by an officer. New England Life Insurance Company controls the
issuance of additional stock and has certain rights to purchase such officer's
shares.
11) Mezzanine Investment Limited Partnerships ("MILPs"), Delaware limited
partnerships, are investment vehicles through which investments in certain
entities are held. A wholly owned subsidiary of Metropolitan serves as the
general partner of the limited partnerships and Metropolitan directly owns a 99%
limited partnership interest in each MILP. The MILPs have various's ownership
interests in certain companies. The various MILPs own, directly or indirectly,
100% of the voting stock of the following company: Coating Technologies
International, Inc.
NOTE: THE METROPOLITAN LIFE ORGANIZATIONAL CHART DOES NOT INCLUDE REAL ESTATE
JOINT VENTURES AND PARTNERSHIPS OF WHICH METROPOLITAN LIFE AND/OR ITS
SUBSIDIARIES IS AN INVESTMENT PARTNER. IN ADDITION, CERTAIN INACTIVE
SUBSIDIARIES HAVE ALSO BEEN OMITTED.
<PAGE>
ITEM 27. NUMBER OF CONTRACTOWNERS.
As of February 28, 1999:
<TABLE>
<CAPTION>
NUMBER OF
TITLE OF CLASS HOLDERS
------------------------- ---------
<S> <C>
Contract holders
Qualified..............
Non-Qualified..........
</TABLE>
ITEM 28. INDEMNIFICATION
UNDERTAKING PURSUANT TO RULE 484(B)(1) UNDER THE SECURITIES ACT OF 1933
Metropolitan Life Insurance Company has secured a Financial Institutions
Bond in the amount of $50,000,000, subject to a $5,000,000 deductible.
Metropolitan Life Insurance Company maintains a directors' and officers'
liability policy with a maximum coverage of $200 million. A provision in the
Metropolitan Life Insurance Company's by-laws provides for the indemnification
(under certain circumstances) of individuals serving as directors or officers of
Metropolitan Life Insurance Company.
Insofar as indemnification for liability arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of
Metropolitan Life Insurance Company pursuant to the foregoing provisions, or
otherwise, Metropolitan has been advised that in the opinion of the Securities
and Exchange Commission such indemnification may be against public policy as
expressed in the Act and may be, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
Metropolitan of expenses incurred or paid by a director, officer or controlling
person or Metropolitan in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, Metropolitan will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
ITEM 29. PRINCIPAL UNDERWRITERS.
(a) The principal underwriter of the registrant is Metropolitan Life
Insurance Company. Metropolitan Life acts in the following capacities with
respect to the following investment companies:
Metropolitan Tower Life Separate Account One (principal underwriter)
Metropolitan Tower Life Separate Account Two (principal underwriter)
Metropolitan Life Separate Account UL (principal underwriter)
Metropolitan Series Fund, Inc. (principal underwriter and investment
adviser)
(b) See response to Item 25 above.
II-22
<PAGE>
(c)
<TABLE>
<S> <C>
(1) (2)
NAME OF PRINCIPAL UNDERWRITER NET UNDERWRITING DISCOUNTS AND
COMMISSIONS
Metropolitan Life Insurance Company N/A
(3) (4)
COMPENSATION ON REDEMPTION OR BROKERAGE COMMISSIONS
ANNUITIZATION
$ N/A
(5)
COMPENSATION
N/A
</TABLE>
ITEM 30. LOCATION OF ACCOUNT AND RECORDS.
Metropolitan Life Insurance Company
One Madison Avenue
New York, N.Y. 10010
ITEM 31. MANAGEMENT SERVICES.
Not Applicable
ITEM 32. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes to file a post-effective
amendment to this registration statement as frequently as is necessary to ensure
that the financial statements in this registration statement are not more than
16 months old for as long as payments under these variable annuity contracts may
be accepted.
(b) The undersigned registrant hereby undertakes to include a post card or
similar written communication affixed to or included in the prospectus that the
applicant can remove to send for a Statement of Additional Information.
(c) The undersigned registrant hereby undertakes to deliver any Statement
of Additional Information and any financial statements required to be made
available under this form promptly upon written or oral request.
(d) The undersigned registrant represents that it is relying on the
exemptions from certain provisions of Sections 22(e) and 27 of the Investment
Company Act of 1940 provided by Rule 6c-7 under the Act. The registrant further
represents that the provisions of paragraph (a)-(d) of Rule 6c-7 have been
complied with.
(e) The undersigned registrant represents that for its TSA Deferred
Annuities it is relying on the "no-action" position of the Commission staff as
contained in its November 7, 1988 letter to the American Council of Life
Insurance and has complied with the provisions of numbered paragraphs (1)-(4) of
such letter.
(f) Metropolitan Life Insurance Company represents that the fees and
charges deducted under the Deferred Annuities described in this Registration
Statement, in the aggregate, are reasonable in relation to the services
rendered, the expenses to be incurred, and the risks assumed by Metropolitan
Life Insurance Company under the Deferred Annuities.
II-23
<PAGE>
SIGNATURES
AS REQUIRED BY THE SECURITIES ACT OF 1933 AND THE INVESTMENT COMPANY ACT OF
1940, THE REGISTRANT CERTIFIES AND HAS CAUSED THIS REGISTRATION STATEMENT TO BE
SIGNED ON ITS BEHALF, IN THE CITY OF NEW YORK, AND STATE OF NEW YORK ON THIS
12TH DAY OF JANUARY, 1999.
METROPOLITAN LIFE SEPARATE ACCOUNT E
(Registrant)
by: METROPOLITAN LIFE INSURANCE COMPANY
(Depositor)
by: /s/ Gary A. Beller
-------------------------------------
(Gary A. Beller)
Senior Executive Vice-President
and General Counsel
METROPOLITAN LIFE INSURANCE COMPANY
(Depositor)
by: /s/ Gary A. Beller
-------------------------------------
(Gary A. Beller)
Senior Executive Vice-President
and General Counsel
II-24
<PAGE>
SIGNATURES
AS REQUIRED BY THE SECURITIES ACT OF 1933, THIS REGISTRATION STATEMENT HAS
BEEN SIGNED BY THE FOLLOWING PERSONS IN THE CAPACITIES AND ON THE DATES
INDICATED.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- ------------------------------- ---------------------------- ----------------
<S> <C> <C>
* Chairman, President, Chief
----------------------------- Executive Officer and
Robert H. Benmosche Director
* Vice Chairman, Chief
----------------------------- Investment Officer and
Gerald Clark Director
* Vice Chairman, Chief
----------------------------- Financial Officer (Principal
Stewart G. Nagler Financial Officer) and
Director
* Senior Vice-President
----------------------------- Controller and General
Jon F. Danski Auditor (Principal
Accounting Officer)
* Director
-----------------------------
Curtis H. Barnette
* Director
-----------------------------
Joan Ganz Cooney
* Director
-----------------------------
Burton A. Dole, Jr.
* Director
-----------------------------
James R. Houghton
* Director
-----------------------------
Harry P. Kamen
* Director
-----------------------------
Helene L. Kaplan
By: /s/ RICHARD G. MANDEL, ESQ.
-----------------------------
Richard G. Mandel, Esq.
Attorney-in-Fact January 12, 1999
</TABLE>
II-25
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- ------------------------------- ---------------------------- ----------------
<S> <C> <C>
* Director
-----------------------------
Charles M. Leighton
* Director
-----------------------------
Allen E. Murray
* Director
-----------------------------
John J. Phelan, Jr.
* Director
-----------------------------
Hugh B. Price
* Director
-----------------------------
Robert G. Schwartz
* Director
-----------------------------
Ruth J. Simmons, Ph.D.
* Director
-----------------------------
William C. Steere, Jr.
By: /s/ RICHARD G. MANDEL, ESQ.
-----------------------------
Richard G. Mandel, Esq.
Attorney-in-Fact January 12, 1999
</TABLE>
II-26
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT No. EXHIBIT INDEX
- ----------- -------------
<S> <C>
(1) -- Resolution of the Board of Directors of Metropolitan Life
establishing Separate Account E.(2)
(2) -- Not applicable.
(3)(a) -- Not applicable.
(b) -- Form of Selected Broker Agreement.(2)
(c) -- Participation Agreement--Calvert.(5)
(d) -- Participation Agreements--Fidelity Distributors Corp.(5)
(d)(i) -- Supplemental Agreements--Fidelity
(4)(a) -- Amended Form of IRC Section 401 Group Annuity Contract
(VestMet).(5)
(a)(i) -- Form of IRC Section 401 Group Annuity Contract (Preference
Plus) (Version 2).(5)
(a)(ii) -- Form of IRC Section 401 Group Annuity Contract (Preference
Plus) (Allocated and Unallocated).(5)
(a)(iii) -- Form IRC Section 401 Individual Annuity Contract (Preference
Plus).(5)
(a)(iv) -- Form IRC Section 401 Group Annuity Contract (Preference
Plus) (Oregon).(2)
(a)(v) -- Form IRC Section 401 Group Annuity Contract (Preference
Plus) (Allocated).(4)
(a)(vi) -- Form IRC Section 401 Group Annuity Contract (Preference
Plus) (Allocated) (New York).(4)
(a)(vii) -- Form of Certificate under IRC Section 401 Group Annuity
Contract (Preference Plus) (New York).(4)
(b) -- Amended Form of IRC Section 403(b) Group Annuity Contract
(VestMet).(5)
(b)(i) -- Amended Form of IRC Section 403(b) Group Annuity Contract
(Preference Plus).(5)
(b)(i)(A) -- Form of IRC Section 403(b) Group Annuity Contract (Financial
(b)(i)(B) -- Form of IRC Section 403(b) Group Annuity Contract (Enhanced
Preference Plus Contract-Montefiore Medical Center,
Maimonides Medical Center, The Mount Sinai Hospital).(2)
Freedom-LIJ).(5)
</TABLE>
<PAGE>
<TABLE>
<S> <C>
(b)(i)(C) -- Form of IRC Section 403(b) Group Annuity Contract (Financial
Freedom Account) (New Jersey-ABP).(4)
(b)(i)(D) -- Form of IRC Section 403(b) Group Annuity Contract (Financial
Freedom Account) (Texas-ORP).(4)
(b)(i)(E) -- Form of IRC Section 403(b) Individual Annuity Contract
(Preference Plus) (Oregon).(4)
(b)(ii) -- Form of Certificate under IRC Section 403(b) Group Annuity
Contract (VestMet).(5)
(b)(iii) -- Form of Certificate under IRC Section 403(b) Group Annuity
Contract (Preference Plus) (Version 2).(5)
(b)(iii)(A) -- Form of Certificate under IRC Section 403(b) Group Annuity
Contract (Preference Plus) (Versions 1 and 2).(5)
(b)(iii)(B) -- Amended Form of Certificate under IRC Section 403(b) Group
Annuity Contract (Preference Plus) (New York).(5)
(b)(iii)(C) -- Form of Certificate under IRC Section 403(b) Group Annuity
Contract (Financial Freedom Account).(5)
(b)(iii)(D) -- Forms of Certificate under IRC Section 403(b) Group Annuity
Contract (Preference Plus--Enhanced TSA Preference Plus
Contract).(5)
(b)(iii)(E) -- Amended Form of Certificate under IRC Section 403(b) Group
Annuity Contract (Preference Plus).(5)
(b)(iii)(F) -- Form of Certificate under IRC Section 403(b) Group Annuity
Contract (Chapman).(5)
(b)(iii)(G) -- Form of Certificate under IRC Section 403(b) Group Annuity
Contract (Preference Plus, Enhanced Preference Plus,
Financial Freedom) (Oregon).(2)
(b)(iii)(H) -- Form of Endorsement under IRC Section 403(b) Group Annuity
Contract (Preference Plus).(2)
(b)(iii)(I) -- Form of Endorsement under Section 403(b) Group Annuity
Contract (Preference Plus, Enhanced Preference Plus,
Financial Freedom).(2)
(b)(iv) -- Form of Texas Rider for Certificate under IRC
Section 403(b) Group Annuity Contract (VestMet).(5)
(b)(v) -- Form of Texas Endorsement for Certificate under IRC
Section 403(b) Group Annuity Contract (Preference Plus).(5)
(b)(vi) -- Form of Certificate under IRC Section 403(b) Group Annuity
Contract (Financial Freedom Account) (New Jersey-ABP).(4)
(b)(vii) -- Form of Certificate under IRC Section 403(b) Group Annuity
Contract (Enhanced Preference Plus) (Oregon).(4)
(b)(viii) -- Form of Certificate under IRC Section 403(b) Group Annuity
Contract (Financial Freedom) (Texas-ORP).(4)
(b)(ix) -- Form of Certificate under IRC Section 403(b) Group Annuity
Contract (Financial Freedom Account) (Texas-ORP).(4)
(b)(x) -- Forms of Endorsement under IRC Section 403(b) Group Annuity
Contract, 403(a) Group Annuity Contract and Individual
Retirement Annuity Contract.(4,5)
(b)(xi) -- Forms of Endorsement under IRC Section 403(b) Group Annuity
Contract.(4,5)
(b)(xii) -- Forms of Endorsement under IRC Section 403(b) for Annuity
Contract (VestMet)--Forms R.S.1208 and G.20247-567(7)
(b)(xiii) -- Forms of Endorsement under IRC Section 408(b) for Flexible
Contribution Individual Retirement Annuity (38PP-90(IRA-1),
and (G.4333-15, G.4333 (IRA/ENH)--Forms R.S.1228 and
G.20247-568(7)
(b)(xiv) -- Form of Endorsement under IRC Section 403(b)
(G.4333-7)--Form G.20247.563(7)
(c) -- Form of IRC Section 408 Simplified Employee Pension Contract
(VestMet).(5)
(c)(i)(A) -- Form of IRC Section 408 Simplified Employee Pension Contract
(c)(i)(B) -- Amended Form of IRC Section 408 Simplified Employee Pension
Contract (Preference Plus).(5)
(Preference Plus) (Version 2).(5)
</TABLE>
<PAGE>
<TABLE>
<S> <C>
(c)(i)(C) -- Form of IRC Section 408 Simplified Employee Pension Contract
(Preference Plus) (Oregon).(2)
(c)(i) -- Form of IRC Section 408 Simplified Employee Pension Contract
(Illinois, Minnesota) (VestMet).(5)
(c)(ii) -- Form of IRC Section 408 Simplified Employee Pension Contract
(Michigan) (VestMet).(5)
(c)(iii) -- Form of IRC Section 408 Simplified Employee Pension Contract
(New York) (VestMet).(5)
(c)(iv) -- Form of IRC Section 408 Simplified Employee Pension Contract
(South Carolina) (VestMet).(5)
(c)(v) -- Form of IRC Section 408 Simplified Employee Pension Contract
(Pennsylvania) (VestMet).(5)
(c)(vi) -- Form of IRC Section 408 Simplified Employee Pension Contract
(Washington) (VestMet).(5)
(c)(vii) -- Information Statement concerning IRC Section 408 Simplified
Employee Pension Contract (VestMet).(5)
(d) -- Form of IRC Section 408 Individual Retirement Annuity
Contract (VestMet).(5)
(d)(i)(A) -- Form of IRC Section 408 Individual Retirement Annuity
Contract (Preference Plus) (Version 2).(5)
(d)(i)(B) -- Form of IRC Section 408 Individual Retirement Annuity
Contract (Preference Plus).(5)
(d)(i)(C) -- Form of IRC Section 408 Individual Retirement Annuity
Contract (Preference Plus) (Oregon).(2)
(d)(i) -- Form of Endorsement to IRC Section 408 Individual Retirement
Annuity Contract (VestMet).(5)
(d)(ii) -- Form of Endorsement to IRC Section 408 Individual Retirement
Annuity Contract (Michigan) (VestMet).(5)
(d)(iii) -- Form of IRC Section 408 Individual Retirement Annuity
Contract (Illinois, Minnesota) (VestMet).(5)
(d)(iv) -- Form of IRC Section 408 Individual Retirement Annuity
Contract (Michigan) (VestMet).(5)
(d)(v) -- Form of IRC Section 408 Individual Retirement Annuity
Contract (New York) (VestMet).(5)
(d)(vi) -- Form of IRC Section 408 Individual Retirement Annuity
Contract (South Carolina) (VestMet).(5)
(d)(vii) -- Form of IRC Section 408 Individual Retirement Annuity
Contract (Pennsylvania) (VestMet).(5)
(d)(viii) -- Form of IRC Section 408 Individual Retirement Annuity
Contract (Washington) (VestMet).(5)
(d)(ix) -- Information Statement concerning IRC Section 408 Individual
Retirement Annuity Contract (VestMet).(5)
(d)(x) -- Form of Endorsement to IRC Section 408 Individual Retirement
Annuity Contract (VestMet).(5)
(d)(xi) -- Form of Endorsement to IRC Section 408 Individual Retirement
Annuity Contract (Michigan) (VestMet).(5)
(d)(xii) -- Form of Endorsement to IRC Section 408 Individual Retirement
Annuity Contract (South Carolina) (VestMet).(5)
(d)(xiii) -- Form of Endorsement to IRC Section 408 Individual Annuity
Contract (Preference Plus).(4)
(e) -- Amended Form of IRC Section 408 Group Individual Retirement
Annuity Contract (VestMet).(5)
(e)(1) -- Form of IRC Section 408 Group Individual Retirement Annuity
Contract (Preference Plus).(5)
(e)(i) -- Form of Certificate under IRC Section 408 Group Individual
Retirement Annuity Contract (VestMet).(5)
(e)(i)(A) -- Form of Certificate under IRC Section 408 Group Individual
Retirement Annuity Contract (Preference Plus).(5)
(e)(i)(B) -- Forms of Certificate under IRC Section 408 Group Individual
Retirement Annuity Contract (Enhanced).(2,5)
</TABLE>
<PAGE>
<TABLE>
<S> <C>
(e)(i)(C) -- Form of Certificate under IRC Section 408 Group Individual
Retirement Annuity Contract (Oregon).(2)
(f) -- Amended Form of IRC Section 457 Group Annuity Contract for
Public Employee Deferred Compensation Plans (VestMet).(5)
(f)(i) -- Form of IRC Section 457 Group Annuity Contract for Public
Employee Deferred Compensation Plans (Preference Plus)
(Version 2).(5)
(f)(ii) -- Amended Form of IRC Section 457 Group Annuity Contract for
Public Employee Deferred Compensation Plans (Preference
Plus).(5)
(f)(iii) -- Form of IRC Section 457 Group Annuity Contract for Public
Employee Deferred Compensation Plans (Enhanced Preference
Plus).(5)
(f)(iv) -- Form of IRC Section 457 Group Annuity Contract for Public
Employee Deferred Compensation Plans (Financial Freedom).(5)
(f)(v) -- Form of IRC Section 457 Group Annuity Contract for Public
Employee Deferred Compensation Plans (Enhanced Preference
Plus).(4)
(f)(vi) -- Form of Endorsement under IRC Section 457(b) for Public
Employee Deferred Compensation Plans (G.3068) (Preference
Plus)--Form G.7812-45(7)
(g) -- Form of Endorsement to IRC Section 408 Individual Retirement
Annuity Contract which Converts Contract into Non-Qualified
Status (VestMet).(5)
(g)(1) -- Form of Non-Qualified Contract (Preference Plus) (Version
2).(5)
(g)(i)(A) -- Amended Form of Non-Qualified Contract (Preference Plus).(5)
(g)(i)(B) -- Form of Non-Qualified Contract (Preference Plus)
(Oregon).(2)
(g)(i) -- Information Statement concerning IRC Section 408 Individual
Retirement Annuity Contract with Non-Qualified Endorsement
(VestMet).(5)
(g)(ii) -- Form of Endorsement to IRC Section 408 Individual Retirement
Annuity Contract with Non-Qualified Endorsement (Michigan)
(VestMet).(5)
(g)(iii) -- Form of Endorsement to IRC Section 408 Individual Retirement
Annuity Contract with Non-Qualified Endorsement (South
Carolina) (VestMet).(5)
(g)(iv) -- Form of Endorsement to Group Annuity Contract.(5)
(h) -- Amended Form of Non-Qualified Group Contract (VestMet).(5)
(h)(1) -- Form of Non-Qualified Group Contract (Preference Plus).(5)
(h)(i) -- Form of Certificate under Non-Qualified Group Contract
(VestMet).(5)
(h)(i)(A) -- Forms of Certificate under Non-Qualified Group Contract
(Preference Plus).(5)
(h)(i)(A)(i) -- Form of Certificate under Non-Qualified Group Contract
(Preference Plus-Enhanced Contract; Enhanced Preference
Plus).(2)
(h)(i)(A)(ii) -- Form of Certificate under Non-Qualified Group Contract
(Preference Plus-Enhanced Contract; Enhanced Preference
Plus) (Oregon).(2)
(h)(i)(B) -- Form of Non-Qualified Group Contract (Preference Plus).(5)
(h)(i)(C) -- Form of Non-Qualified Group Contract (Enhanced Preference
Plus).(5)
(h)(i)(D) -- Form of Endorsement Concerning Nursing Home or Terminal
Illness.(2)
(h)(i)(E) -- Form of Endorsement for death claim settlement for
MT-(37PP-90(NQ-1), (38PP-90(IRA-)--Form R.S. 1234MT1998(7)
(h)(i)(F) -- Form of Non-Qualified Group Contract (Financial Freedom
Account) Form--G.3043(7)
(i) -- Endorsement with respect to Individual IRA and Individual
Non-Qualified Contract concerning Death Benefit Provisions
(VestMet).(5)
(j) -- Specimen of variable retirement annuity contract for
Metropolitan Variable Account B.(5)
(k) -- Proposed Form of Metropolitan Investment Annuity Program,
Form 37-74 MIAP for Metropolitan Life Variable Account C.(5)
(l) -- Proposed Form of Metropolitan Investment Annuity Program,
Form 37-74 MIAP for Metropolitan Life Variable Account D.(5)
</TABLE>
<PAGE>
<TABLE>
<S> <C>
(m) -- Specimen of Flexible-Purchase Variable Annuity Contract for
Metropolitan Variable Account A.(1)
(n) -- Specimen of Variable Annuity Contract, Forms 37TV-65 and
20SV-65 for Metropolitan Variable Account B.(5)
(o) -- Form of Certificate under IRC Section 403(a) Group Annuity
Contract (Preference Plus).(5)
(o)(i) -- Forms of Certificate under IRC Section 403(a) Group Annuity
Contract (Financial Freedom).(5)
(o)(ii) -- Form of Certificate under IRC Section 403(a) Group Annuity
Contract (South Carolina).(5)
(o)(iii) -- Form of Certificate under IRC Section 403(a) Group Annuity
Contract (SUNY).(5)
(o)(iv) -- Form of Certificate under IRC Section 403(a) Group Annuity
Contract (Oregon).(2)
(p) -- Form of Single Premium Immediate Income Payment Contract
(Preference Plus).(5)
(q) -- Form of Single Premium Immediate Income Payment Certificate
(Enhanced Preference Plus and Financial Freedom).(5)
(r) -- Endorsements for Single Premium Immediate Income Payment
Contract.(5)
(r)(i) -- Form of Endorsement for Single Premium Immediate Income
Payment Contract (G.4333(VARPAY)--Form G.20247-560(7)
(s) -- Form of Endorsement with respect to the Roth Individual
Retirement Annuity--Form R.S. 1220-PPA(6)
(s)(i) -- Form of Endorsement with respect to the Roth Individual
Retirement Annuity--Form R.S. 1220-PPA (Minnesota).(6)
(s)(ii) -- Form of Endorsement with respect to the Roth Individual
Retirement Annuity--Form R.S. 1220-PPA (New Jersey).(6)
(s)(iii) -- Form of Amendment with respect to the Roth Individual
Retirement Annuity--Form R.S. 1212-PPA.(6)
(s)(iv) -- Form of Amendment with respect to the Roth Individual
Retirement Annuity--Form R.S. 1212-PPA (Minnesota).(6)
(s)(v) -- Form of Amendment with respect to the Roth Individual
Retirement Annuity--Form R.S. 1212-PPA (New Jersey).(6)
(t) -- Form of Group Annuity Contract and Amendment under IRC
Section 415(m)--Forms G. 3043A and G. 3043A-1 (Financial
Freedom Account).(6)
(u) -- Form of Endorsement with respect to Waiver of Administrative
Fee--Form R.S. 1206.(6)
(v) -- Forms of Endorsement with respect to exchange from Growth
Plus Account to the Preference Plus Account--Form RSC
E31910-2.(6)
(w) -- Forms of Endorsement with respect to Enhanced 10% corridor
(37PP-90(NQ-1), 38PP-90 (IRA-1) NQ/IRA, NJ PPA and
(PSC94-05)--Forms R.S. 1222, R.S.1222N.J., R.S. 1232 and G.
20247-573(7)
(x) -- Forms of Endorsement with respect to Fund Expansion
(38PP-90(NQ-1), (38PP-90(IRA-1), TSA/403(a), PPI immediate
(PSC 93-05A)--Forms R.S. 1230 (11/98), G 20247-572 and R.S.
1231 (11/98)(7)
(y) -- Forms of Endorsement with respect to Exchange
(37PP-90(NQ-1), 38PP-90(IRA-1) and (G.4333-7)--Forms
E31910-3 and G.7812-38-1(7)
(z) -- Forms of Endorsement for SIMPLE IRA (G.4333-15) and
(G.4333-15+RSC 96-37)--Forms RSC 96-37 and R.S.1209(7)
(5)(a) -- Participation Request and Agreement for the IRC Section 401
Group Annuity Contract.(5)
(b) -- Enrollment Form with respect to the IRC Section 401 Group
Annuity Contract.(5)
(b)(i) -- Enrollment Form with respect to the IRC Section 401 Group
Annuity Contract (Preference Plus) (Allocated).(5)
(c) -- Participation Request and Agreement for the IRC
Section 403(b) Group Annuity Contract.(5)
(c)(i) -- Participation Request and Agreement for the IRC
Section 403(b) Group Annuity Contract (Direct Mail Form).(5)
</TABLE>
<PAGE>
<TABLE>
<S> <C>
(d) -- Enrollment Form with respect to the IRC Section 403(b) Group
Contract and the IRC Section 457 Group Annuity Contract.(2)
(d)(i) -- 403(b) Tax Deferred Annuity Customer Agreement
Acknowledgement.(5)
(d)(ii) -- Enrollment Form with respect to the IRC Section 403(b) Group
Annuity Contract (Enhanced Preference Plus TSA).(5)
(d)(iii) -- Enrollment Form with respect to the IRC Section 403(b) Group
Annuity Contract (FFA-TSA).(5)
(e) -- Enrollment Form with respect to the IRC Section 403(b) Group
Annuity Contract and the IRC Section 457 Group Annuity
Contract.(5)
(f) -- Application for an IRC Section 408 Simplified Employee
Pension, IRA and Non-Qualified Deferred Annuities
(Preference Plus).(2)
(f)(i) -- Application for Individual IRA and Non-Qualified Contract
(Direct Mail Form).
(g) -- Employer Adoption Request Form.(5)
(g)(i) -- Employer Utilization Request Form.(5)
(g)(ii) -- Enrollment Form for IRC Section 408 Group Individual
Retirement Account Contract and Non-Qualified Group
Contract.(5)
(g)(iii) -- Funding Authorization and Agreement.(5)
(g)(iv) -- Funding Authorization and Agreement (SEP).(5)
(h)(i) -- Enrollment Form for IRC Section 408 Individual Retirement
Annuity, IRC Section 408k Simplified Employee Pension and
Non-Qualified Income Annuity Contract.(5)
(h)(ii) -- Enrollment Form for IRC Sections 403(b), 403(a) and 457
Group Income Annuity Contract.(5)
(h)(iii) -- Enrollment Form for Group IRA Rollover Annuity (Preference
Plus-Enhanced Contract).(2)
(h)(iv) -- Enrollment Form for Group Non-Qualified Supplemental Savings
(Preference Plus-Enhanced Contract).(2)
(i) -- Application for Variable Annuity (Preference
Plus(Registered) Account) TSA/IRC Section 457(b) Deferred
Compensation/IRC Section 403(a) for form G.4333-7
FORM--038-PPA-TSA/PEDC (0998)(7)
(i)(i) -- Application for Variable Annuity (Preference
Plus(Registered) Account) for 37PP-90 (NQ-1), 38PP-90
(IRA-1) FORM--038-PPA-IRA/SEP/NQ (0998)(7)
(i)(ii) -- Application for the Preference Plus(Registered) Income
Annuity for RSC 93-05A FORM--RSCINCAPNQIRASEP (10/98)(7)
(i)(iii) -- Application for Variable Annuity Enhanced Preference
Plus(Registered) Account for MetLife Employees for forms
G.4333-14, G.4333-15 Form--038MEGPPAIRA/NQ(10/98)(7)
(6) -- Charter and By-Laws of Metropolitan Life.(2)
(6)(a) -- By-Laws Amendment.(2)
(7) -- Not applicable.
(8) -- Not applicable.
(9) -- Opinion and consent of counsel as to the legality of the
securities being registered.(5)
(10) -- Not applicable.
(11) -- Not applicable.
(12) -- Not applicable.
(13)(a) -- Powers of Attorney.(2,4,5)
</TABLE>
- ------------------
1. Previously filed with the initial filing of the Registration Statement of
Metropolitan Variable Account A of Metropolitan Life Insurance Company on May
28, 1969.
(Footnotes continued on next page)
<PAGE>
(Footnotes continued from previous page)
2. Filed with Post-Effective Amendment No. 19 to this Registration Statement on
Form N-4 on February 27, 1996. Power of attorney for Ruth J. Simmons was also
filed.
3. Filed with Post-Effective Amendment No. 20 to this Registration Statement on
Form N-4 on April 29, 1996.
4. Filed with Post-Effective Amendment No. 21 to this Registration Statement on
Form N-4 on February 28, 1997. Powers of attorney for Gerald Clark, Burton A.
Dole, Jr. and Charles H. Leighton were also filed.
5. Filed with Post-Effective Amendment No. 22 to this Registration Statement on
Form N-4 on April 30, 1997.
6. Filed with Post-Effective Amendment No. 23 to this Registration Statement on
Form N-4 on April 3, 1998. Including powers of Attorney for Robert H.
Benmosche, Jon F. Danski and Stewart G. Nagler.
7. Filed herewith.
<PAGE>
Exhibit 4(b)(xii)
Met Logo
Metropolitan Life Insurance Company
(A Mutual Company Incorporated in New York State)
One Madison Avenue, New York, New York 10010
ENDORSEMENT
This Endorsement amends the Tax Sheltered Annuity ("TSA") contract or
certificate to which it is attached by adding provisions required by the
Internal Revenue Code of 1986 ("Code") to assure continued qualification as a
Tax Sheltered Annuity under Section 403(b) of the Code (references to contracts
throughout this Endorsement apply to your 403(b) contract or 403(b)
certificate):
I. TSA CONTRIBUTIONS
Sections 403(b)(2) and 415 of the Code limit the annual amounts that may be
deposited in 403(b) contracts. The contributions permitted under this
contract may not exceed these limitations or the limitations in Section
402(g) of the Code that apply to salary reduction elective deferrals under
this contract and all other contracts you have through your employer.
This contract will accept transfer amounts from other 403(b) contracts or
403(b)(7) custodial accounts in accordance with Rev. Rul. 90-24. This
contract will also accept eligible rollover distributions under sections
403(b)(8) and 408(d)(3)(A)(iii).
II. CONTRIBUTIONS MADE TO A 403(b) ERISA PLAN
If contributions to your contract have been made under a 403(b) plan
subject to the Employee Retirement Income Security Act (ERISA) and if you
have a spouse, the income payments, withdrawal provisions, payment of the
death benefit and loans under this contract, if applicable, are subject to
your spouse's rights as described below. In these circumstances, benefits
under the contract will be provided in accordance with the applicable
consent, present value, and other requirements of Code Sections 401(a)(11)
and 417 applicable to your plan.
If you have a spouse, your spouse must give qualified consent whenever you
elect to:
o choose income payments other than on a qualified joint and survivor
basis (one under which we pay you for your life and then make payments
reduced by no more than 50% to your spouse for his or her remaining
life, if any);
o make a withdrawal;
o take a loan exceeding $3,500 ($5,000 for plan years beginning after
August 5, 1997) under this contract;
o designate a beneficiary other than the spouse for more than 50% of the
death benefit.
A qualified consent must be in writing, dated, signed by your spouse and
witnessed by a notary public and in a form satisfactory to us. Such
consent, once made, is irrevocable. Except for designations of beneficiary
for death benefit purposes, such consent must be
Form R.S. 1208
1
<PAGE>
executed during the 90 day period ending with the date income payments are
to commence, the withdrawal is to be made, or the loan is to be made, as
the case may be. A qualified consent may not be given to any beneficiary
designations or changes for death benefit purposes until you attain age 35
or terminate employment with the employer then making purchase payments to
this contract, whichever comes first. There is no limit to the number of
your elections as long as a qualified consent is given each time.
Notwithstanding the foregoing, the consent of your spouse will not be
required if you, your estate representative, or your beneficiary
establishes that it cannot be obtained because there is no spouse, or
because the spouse cannot be located or if your vested account balance does
not exceed $3,500 ($5,000 for plan years beginning after August 5, 1997).
III. WITHDRAWAL RESTRICTIONS
Salary reduction elective deferral contributions made after December 31,
1988 and the earnings credited to those purchase payments cannot be
withdrawn until you attain age 59 1/2, retire, terminate employment, become
disabled as defined in Code Section 72(m)(7), or die. This restriction also
applies to earnings after December 31, 1988 on amounts attributable to your
pre-1989 elective deferral purchase payments. We are required by the Code
to prohibit these withdrawals, except as noted below.
o Except to the extent required by the Code, these restrictions do not
apply to 403(b) balances transferred on a non-taxable basis to other
403(b) contracts or accounts. In applying these restrictions, if your
contract is multifunded, we will treat it as if it were a single
account and ignore your actual allocations.
o To the extent that we are required to apply the withdrawal
restrictions of Code Section 403(b)(7) to balances transferred on a
non-taxable basis into this contract, we will do so.
IV. MINIMUM DISTRIBUTIONS
a) The Owner's entire interest in this contract must generally be
distributed or commence to be distributed, no later than the first day
of April following the calendar year in which the Owner attains age 70
1/2. Distribution will be made in equal or substantially equal
amounts, over (i) the life of the Owner, or the lives of the Owner and
the named beneficiary, or (ii) a period not extending beyond the life
expectancy of the Owner, or the joint and last survivor life
expectancy of the Owner and the named beneficiary. All distributions
hereunder (including distributions of the death benefit under
paragraph VII of this Endorsement) shall be made in accordance with
all relevant Code requirements, including Code Section 401(a)(9) and
the regulations thereunder, including Proposed Regulation
1.401(a)(9)-2. Any withdrawal or income option under this contract
which is inconsistent with Code Section 401(a)(9) is not valid.
2
<PAGE>
b) If you attained age 70 1/2 before January 1, 1988, or if you are a
participant in a church or governmental plan, you do not have to start
to receive your account balance until April 1 of the calendar year
following the year in which you retire.
c) For taxable years beginning after December 31, 1996 (except in the
case of a more than 5% owner), distributions do not have to begin
until April 1 of the calendar year following the later of (i) the
calendar year in which you attain age 70 1/2, or (ii) if your plan
permits, the calendar year in which you retire.
d) Minimum distribution requirements may be satisfied by receiving a
distribution from one Tax Sheltered Annuity that is equal to the
amount required to satisfy the minimum distribution requirements for
two or more Tax Sheltered Annuities. For this purpose, the owner of
two or more Tax Sheltered Annuities may use an alternative method to
satisfy the minimum distribution requirements.
V. ELIGIBLE ROLLOVER DISTRIBUTIONS
For distributions made after 1992, notwithstanding any provision of this
contract to the contrary that would otherwise limit an election under this
provision, you or your surviving spouse or former spouse who is an
alternate payee under a qualified domestic relations order, as defined in
Section 414(p) of the Code (hereinafter referred to as Distributee), may
elect at the time and in the manner prescribed by MetLife as payor and, if
applicable, the plan administrator, to have any portion of an eligible
rollover distribution paid directly to an eligible retirement plan
specified by the Distributee in a direct rollover. An eligible rollover
distribution from this contract is the taxable portion of any distribution
made to the Distributee, except that an eligible rollover distribution does
not include the following:
o any distribution that is one of a series of substantially equal
periodic payments (not less frequently than annually) made for the
life (or life expectancy of the Distributee or the joint lives or
joint life expectancies) of the Distributee and his or her named
beneficiary;
o any distribution that is one of a series of substantially equal
periodic payments (not less frequently than annually) for a specified
period of 10 years or more;
o any distribution to the extent such distribution is required under
Section 401(a)(9) of the Code; or
o the portion of any distribution that is not includible in gross
income.
An eligible rollover distribution is subject to mandatory 20% income tax
withholding unless the Distributee elects a direct rollover to an eligible
retirement plan. An eligible retirement plan is an individual retirement
account as described in Section 408(a) of the Code, an individual
retirement annuity under section 408(b), or, except for your surviving
spouse, a tax-sheltered annuity as described in Section 403(b) of the Code,
that accepts your eligible rollover distribution.
3
<PAGE>
VI. LOAN PROVISION
If your contract provides for loans the following provisions apply:
a) Such loans shall in no case exceed the lesser of (1) or (2) where:
(1) equals $50,000 less the excess (if any) of (i) the highest
outstanding loan balance (aggregating all loans from qualified plans)
during the one-year period prior to the date a loan is made over (ii)
the outstanding loan balance on the date a loan is made and (2) equals
the greater of (i) 50% of the vested account balance or (ii) the
vested account balance but not in excess of $10,000.
If purchase payments have been made under a 403(b) plan subject to
ERISA, the maximum loan amount cannot exceed 50% of the vested account
balance in any case.
Your contract or 403(b) plan may further limit the amount of the loan
and the circumstances under which loans are permitted.
b) Such loans must be repaid within 5 years from the date of the loan.
Such repayment must be on a level basis over the 5 year period with
repayments being made at least quarterly. If the loan is made to
acquire a dwelling unit which is to be used as your principal
residence, it must be repaid within a reasonable time as provided in
your loan agreement which may exceed 5 years.
c) If you fail to pay any loan repayment when it is due, if permitted
under the terms of your loan agreement, we will treat the entire
unpaid loan balance as a taxable distribution to you at the time of
the default. After a specified grace period, we will report as a
distribution the amount of the unpaid loan balance (including accrued
interest thereon) as required under Section 72(p) of the Code and the
Regulations thereunder. We will also, to the extent permissible under
the Federal tax law, process a partial withdrawal against the Owner's
account so as to surrender the amount of cash value necessary to pay
the delinquent repayment(s) of principal and interest and any
surrender charge and tax withholding (if required). We will only
process a withdrawal under this provision if it is permissible to
withdraw that amount under the Code (including Section 403(b)(11)) and
ERISA.
d) If we are prohibited under the Federal tax law or ERISA from
processing a withdrawal to repay amounts for which you are legally in
default under the terms of your loan agreement, you will continue to
be charged interest on the delinquent amounts as provided under the
terms of your loan agreement until the withdrawal can be made.
e) If required by the Federal tax law, we will also report as a taxable
distribution any of the interest charged and not paid with respect to
any amounts in default which we are not permitted to withdraw from the
account.
4
<PAGE>
f) Notwithstanding anything else in the contract to the contrary, the
terms of your loan are governed by Section 72(p) of the Code and the
Regulations thereunder.
VII. PAYMENT OF DEATH BENEFIT
If you die before the entire interest in this contract is distributed, the
following distribution provisions shall apply:
1. If you die after distribution of your interest has commenced, the
remaining portion of such interest will continue to be distributed at least
as rapidly as under the method of distribution being used prior to your
death.
2. If you die before distribution of your interest commences, your entire
interest will be distributed in accordance with one of the following
provisions:
o We will pay the death benefit to your designated beneficiary or permit
him or her to select one of our available income plans as of the date
we receive proof of death and properly completed claim forms. If you
name no beneficiary (or none is alive when you die), we will pay the
contingent beneficiary.
o If you name no contingent beneficiary (or none is alive when you die),
we will pay your estate. If your estate or other non-individual person
becomes entitled to payment, we will pay the entire death benefit in a
lump sum to such person. Payment to more than one beneficiary or more
than one contingent beneficiary will be in equal shares, unless you
specify otherwise.
o The entire death benefit under this contract must be distributed by no
later than the end of the calendar year which includes the fifth
anniversary of your death. If, however, your beneficiary is a natural
person, your beneficiary may choose an income plan for life or for a
period of years not more than his or her life expectancy. The income
payments must begin by the end of the calendar year following the
calendar year of your death. If Treasury Regulations allow, we may
permit our payments to start later.
o Where otherwise permitted under the terms of this contract, if your
beneficiary is your spouse, then your spouse may continue this
contract until the end of the calendar year that you would have
reached age 70 1/2 when acceptable minimum distributions must begin.
Your spouse cannot make any deposits to this contract.
o For purposes of the Rules dealing with payment of death benefit,
distributions are considered to have begun if distributions are made
on account of your reaching his or her required beginning date, or if
prior to the required beginning date, distributions irrevocably
commence over a period permitted and in an annuity form acceptable
under Section 1.401 (a)(9) of the Proposed Income Tax Regulations.
5
<PAGE>
* * * * *
This contract is nonforfeitable and is for the exclusive benefit of you and your
beneficiaries. It is not transferable. Pursuant to Section 401(a) and 403(b) of
the Code it may not be sold, assigned, discounted, or pledged as collateral or
as security for the performance of an obligation or for any other purpose
(except to the extent permitted under Section 72(p) of the Code with respect to
loans under Article VI of this Endorsement).
In order to preserve the status of this contract as a 403(b) annuity, we have
the right to amend this contract to make it comply with Federal income tax
rules. We will notify you of any amendments and, when required by law, we will
obtain the approval of the appropriate regulatory authority.
We will refund all or part of your account balance, if necessary, to maintain
your contract as a 403(b) annuity. If we make such refunds or payments, we will
adjust your account balance accordingly.
The terms of this endorsement shall override all conflicting provisions of this
contract and shall be effective as of the issue date of this contract or as of
the effective date provided in the Federal tax law, if later.
This Endorsement and this contract shall be interpreted and administered in
accordance with the requirements of section 403(b) of the Code and the
regulations thereunder.
You are responsible for the tax consequences of any contributions, withdrawals
and distributions from the contract. You must provide us with all necessary
instructions and information as may be required to report properly on the
qualified status of this contract.
/s/ Louis J. Ragusa
<PAGE>
Exhibit 4(b)(xii)
Met Logo
Metropolitan Life Insurance Company
One Madison Avenue, New York, NY 10010-3690)
ENDORSEMENT
This Endorsement amends the Tax Sheltered Annuity (TSA) certificate to which it
is attached by adding provisions required by the Internal Revenue Code of 1986
("Code"), as amended from time to time, to assure continued qualification as a
TSA certificate under Section 403(b):
I. TSA CONTRIBUTIONS
Sections 403(b)(2) and 415 of the Code limit the annual amounts that may
be deposited in 403(b) certificates. The contributions permitted under this
certificate may not exceed these limitations or the limitations in Section
402(g) of the Code that apply to salary reduction elective deferrals under
this contract and all other certificates you have through your employer
This certificate will accept transfer amounts from other 403(b) contracts
and certificates or 403(b)(7) custodial accounts in accordance with Rev.
Rul. 90-24. This certificate will also accept eligible rollover
distributions under Sections 403(b)(8) and 408(d)(3)(A)(iii).
II. LOAN PROVISION
a) If you fail to pay any loan repayment when it is due, if permitted
under the terms of your loan agreement, we will treat the entire
unpaid loan balance as a taxable distribution to you at the time of
the default. After a specified grace period, we will report as a
distribution the amount of the unpaid loan balance (including accrued
interest thereon) as required under section 72(p) of the Code and the
Regulations thereunder. We will also, to the extent permissible under
the Federal tax law, process a partial withdrawal against the Owner's
account so as to surrender the amount of cash value necessary to pay
the delinquent repayment(s) of principal and interest and any
surrender fee and tax withholding (if required). We will only process
a withdrawal under this provision if it is permissible to withdraw
that amount under the Code (including Section 403(b)(11)) and the
Employee Retirement Income Security Act ("ERISA").
G. 20247-567
<PAGE>
b) If we are prohibited under Federal tax law or ERISA from processing a
withdrawal to repay amounts for which you are legally in default under
the terms of your loan agreement, you will continue to be charged
interest on the delinquent amounts as provided under the terms of your
loan agreement until the withdrawal can be made.
c) If required by the Federal tax law, we will also report as a taxable
distribution any of the interest charged and not paid with respect to
any amounts in default which we are not permitted to withdraw from the
account.
d) Notwithstanding anything in this certificate to the contrary, the
terms of the loan are governed by Section 72(p) of the Code and any
rules and regulations issued thereunder.
III. MINIMUM DISTRIBUTIONS
a) Minimum distribution requirements may be satisfied by receiving a
distribution from one TSA that is equal to the amount required to
satisfy the minimum distribution requirements for two or more TSAs.
For this purpose, the owner of two or more TSAs may use an alternative
method to satisfy the minimum distribution requirements.
b) If your Plan permits, for taxable years beginning after December 31,
1996 (except in the case of a more than 5% owner), distributions do
not have to begin until April 1 of the calendar year following the
later of i) the calendar year in which you attain age 70 1/2 or (ii)
the calendar year in which you retire.
c) In any case, if you die on or after the date that income payments
start or on or after the date that required minimum distributions to
you have begun, the Code requires that payments or distributions of
the death benefit be made at least as rapidly as under the method of
payment or distribution in effect at the time of your death.
d) If you die before the date that income payments start or before the
date that required minimum distribution to you have begun, we will pay
the death benefit (described below) to your beneficiary or permit him
or her to select one of our available income plans as of the date that
we receive proof of death and properly completed claim forms.
2
<PAGE>
Notwithstanding anything in this certificate to the contrary, only income
plans which comply with the rules described in this section will be made
available to your beneficiary.
IV. ELIGIBLE ROLLOVER DISTRIBUTIONS
For distributions made after 1992, notwithstanding any provision of this
certificate to the contrary that would otherwise limit an election under
this provision, you or your surviving spouse or former spouse who is an
alternate payee under a qualified domestic relations order, as defined in
Section 414(p) of the Code (hereinafter referred to as Distributee), may
elect at the time and in the manner prescribed by MetLife as payor and, if
applicable, the plan administrator, to have any portion of an eligible
rollover distribution paid directly to an eligible retirement plan
specified by the Distributee in a direct rollover. An eligible rollover
distribution from this certificate is the taxable portion of any
distribution made to the Distributee, except that an eligible rollover
distribution does not include the following:
. any distribution that is one of a series of substantially equal
periodic payments (not less frequently than annually) made for the
life (or life expectancy of the Distributee or the joint lives or
joint life expectancies) of the Distributee and his or her named
beneficiary;
. any distribution that is one of a series of substantially equal
periodic payments (not less frequently than annually) for a specified
period of 10 years or more;
. any distribution to the extent such distribution is required under
Section 401(a)(9) of the Code; or
. the portion of any distribution that is not includible in gross
income.
An eligible rollover distribution is subject to mandatory 20% income tax
withholding unless the Distributee elects a direct rollover to an eligible
retirement plan. An eligible retirement plan is an individual retirement
account as described in Section 408(a) of the Code, an individual
retirement annuity under Section 408(b), or, except for your surviving
spouse, a tax-sheltered annuity as described in Section 403(b) of the Code,
that accepts your eligible rollover distribution.
* * * * *
3
<PAGE>
The terms of this Endorsement shall override all conflicting provisions of this
certificate and shall be effective as of the date of issuance of this
certificate or the effective day of any Federal tax law or ERISA provision which
requires the amendment.
This Endorsement and TSA certificate it amends shall be interpreted and
administered in accordance with the requirements of Section 403(b) of the Code
and the regulations thereunder.
You are responsible for the tax consequences of any contributions, withdrawals,
distributions and loans from the certificate. You must provide us with all
necessary instructions and information as may be required to report properly on
the qualified status of this certificate.
/s/ Louis J. Ragusa
4
<PAGE>
Exhibit 4(b)(xiii)
Met Logo
Metropolitan Life Insurance Company
One Madison Avenue, New York, NY 10010-3690
(A Mutual Company Incorporated in New York State)
Endorsement
for
Flexible Contribution Individual Retirement Annuity Contracts
This Endorsement is added to the Contract as of the issue date, or effective on
the date of a change in Federal tax law requiring this Endorsement. In the event
of a conflict between this Endorsement and the Contract (including any prior
endorsements thereto), the provisions of this Endorsement will control.
In order to qualify this Contract as an Individual Retirement Annuity ("IRA")
under Section 408(b) of the Internal Revenue Code of 1986 as subsequently
amended (the "Code"), the following restrictions apply:
1. The Owner of the Contract is the Annuitant, and the Owner of the Contract
CANNOT be changed. The Contract is for the exclusive benefit of the Owner
or the named Beneficiary.
2. This Contract is a flexible contribution contract. Except in the case of
direct transfers or of a rollover contribution (as permitted by Section
402(c), 403(a)(4), 403(b)(8), or 408(d)(3)) or a contribution made in
accordance with the terms of a Simplified Employee Pension ("SEP") as
described in section 408(k), no contributions will be accepted unless they
are in cash, and the total of such contributions shall not exceed $2,000
for any taxable year. In the case of a spousal IRA, the maximum
contribution cannot exceed the limitation in section 219(c) of the Code and
no more than $2,000 can be contributed to either spouse's IRA.
Except for direct transfers and rollovers described above, contributions
cannot be made after the end of the year in which the Owner reaches age
69-1/2.
This contract cannot be used as a SIMPLE IRA under Section 408(p) of the
Code. It will not accept contributions otherwise permitted under Section
408(p) of the Code. Rollovers and transfers into this contract from a
SIMPLE IRA are prohibited during the two year period beginning on the date
that you first participated in any SIMPLE IRA plan maintained by your
employer.
3. The payment of dividends, if any, will be applied to the purchase of
additional benefits before the end of the calendar year following the
declaration of dividends under this Contract. Any refund of purchase
payments (other than
R.S. 1228 (37PP-90(NQ-1),38PP-90(1RA-1))
<PAGE>
those attributable to excess contributions) will be applied, before the
close of the calendar year following the year of the refund, toward the
payment of future contributions or the purchase of additional benefits.
4. The entire interest of the individual for whose benefit the contract is
maintained (Owner) will be distributed or commence to be distributed, no
later than the first day of April following the calendar year in which such
individual attains age 70 1/2 (the "Required Beginning Date"), over (a) the
life of such individual, or the lives of such individual and his or her
designated beneficiary, or (b) a period certain not extending beyond the
life expectancy of such individual and his or her designated beneficiary.
Payments must be made in periodic payments at intervals of no longer than
one year. In addition, payments must be either nonincreasing or they may
increase only as provided in Q&A F-3 Section 1.401(a)(9)-1 of the Proposed
Income Tax Regulations.
All distributions made hereunder shall be made in accordance with the death
benefit requirements of Section 401(a)(9)(G) of the Code, and the
requirements of Section 401(a)(9) of the Code, including the incidental
regulation thereunder, including the minimum distribution incidental
benefit requirement of Section 1.401(a)(9)-2 of the Proposed Income Tax
Regulations.
Life expectancy is computed by use of the expected return multiples in
Table V and VI of Section 1.72-9 of the Income Tax Regulations. Unless
otherwise elected by the individual by the time distributions are required
to begin, life expectancies shall not be recalculated annually. Such
election shall be irrevocable by the individual and shall apply to all
subsequent years. The life expectancy of a non-spouse beneficiary may not
be recalculated. Instead, life expectancy of a nonspousal beneficiary (or
the Owner or spousal beneficiary where the Owner does not elect to
recalculate life expectancy) will be calculated using the attained age of
such beneficiary ( or the attained age of the Owner or spousal beneficary,
if an election to recompute life expectancy is not made) during the
calendar year in which the individual attains age 70 1/2, and payments for
subsequent years shall be calculated based on such life expectancy reduced
by one for each calendar year which has elapsed since the calendar year
life expectancy was first calculated.
5. (a) Distributions Beginning Before Death.
If the Owner dies after distribution of his or her interest has begun,
the remaining portion of such interest will continue to be distributed
at least as rapidly as under the method of distribution being used
prior to individual's death.
(b) Distributions Beginning after Death.
2
<PAGE>
If the Owner dies before distribution of his or her interest begins,
distribution of the Owner's entire interest shall be completed by
December 31 of the calendar year containing the fifth anniversary of
the individual's death except to the extent that an election is made
to receive distributions in accordance with (1), (2) or (3) below:
(1) If the Owner's interest is payable to a designated
beneficiary,then the entire interest of the owner may be
distributed over the life or over a period certain not greater
than the life expectancy of the designated beneficiary
commencing on or before December 31 of the calendar year
immediately following the calendar year in which the Owner died.
(2) If the designated beneficiary is the Owner's surviving spouse,
the date distributions are required to begin in accordance with
(1) above shall not be earlier than the later of (A) December 31
of the calendar year immediately following the calendar year in
which the Owner died or (B) December 31 of the calendar year in
which the Owner would have attained age 70 1/2.
(3) If the designated beneficiary is the Owner's surviving spouse,
the spouse may treat the contract as his or her own IRA. This
election will be deemed to have been made if such surviving
spouse makes a regular IRA contribution to the contract, makes a
rollover to or from such contract, or fails to elect any of the
above provisions.
(c) Life expectancy is computed by use of the expected return multiples in
Tables V and VI of Section 1.72-9 of the Income Tax Regulations. For
purposes of distributions beginning after the Owner's death, unless
otherwise elected by the surviving spouse by the time distributions
are required to begin, life expectancies shall not be recalculated
annually. Such election shall be irrevocable by the surviving spouse
and shall apply to all subsequent years. In the case of any other
designated beneficiary (or in the case of a spousal beneficiary who
does not elect to recalculate life expectancy), life expectancies
shall be calculated using the attained age of such beneficiary during
the calendar year in which distributions are required to begin
pursuant to this section, and payments for any subsequent calendar
year shall be calculated based on such life expectancy reduced by one
for each calendar year which has elapsed since the calendar year life
expectancy was first calculated.
(d) Distributions under this section are considered to have begun if
distributions are made on account of the Owner reaching his or her
required beginning date or if prior to the required beginning date
distributions irrevocably commence to an individual over a period
3
<PAGE>
permitted and in an annuity form acceptable under section 1.401(a)(9)
of the Regulations.
(e) Minimum distribution requirements may be satisfied by receiving a
distribution from one Individual Retirement Account or Individual
Retirement Annuity (collectively, "IRAs"), that is equal to the amount
required to satisfy the minimum distribution requirements for two or
more IRAs. For this purpose, the Owner of two or more IRAs may use an
alternative method to satisfy the minimum distribution requirements.
Notwithstanding the above, if your contract provides for a waiver of
contract withdrawal charges for withdrawals to avoid Federal income
tax penalties imposed on failure to satisfy minimum distribution
requirements, such withdrawal charges will only be waived for the
amount needed to satisfy minimum distribution on this contract and not
your other IRAs.
6. The entire interest of the Owner is nonforfeitable and nontransferable.
7. The Company will furnish annual calendar year reports concerning the status
of this Contract.
8. In order to continue to qualify this Contract under Section 408(b) of the
Code, the Company can amend this Endorsement to reflect changes in the
provisions of the Code and related regulations by sending an amendment to
the Owner.
/s/ Louis J. Ragusa
4
<PAGE>
Exhibit 4(b)(xiii)
Met Logo
Metropolitan Life Insurance Company
One Madison Avenue, New York, NY 10010-3690
(A Mutual Company Incorporated in New York State)
Endorsement
for
Flexible Contribution Individual Retirement Annuity Certificates
This Endorsement is added to the Certificate as of the effective date or, if
later, the date of a change in Federal tax law requiring this Endorsement. In
the event of a conflict between this Endorsement and the Certificate (including
any prior endorsements thereto), the provisions of this Endorsement will
control.
In order to qualify this Certificate as an Individual Retirement Annuity ("IRA")
under Section 408(b) of the Internal Revenue Code of 1986 as subsequently
amended (the "Code"), the following restrictions apply:
1. The owner of the Certificate is the annuitant, and the owner of the
Certificate cannot be changed. The Certificate is for the exclusive benefit
of the owner and the beneficiary.
2. This Certificate is a flexible contribution certificate. All contributions
must be paid by cash, check or money order Except in the case of direct
transfers or of a rollover contribution (as permitted by Section 402(c),
403(a)(4), 403(b)(8), or 408(d)(3)) or a contribution made in accordance
with the terms of a Simplified Employee Pension ("SEP") as described in
section 408(k), the total of such contributions shall not exceed $2,000 for
any taxable year. In the case of a spousal IRA, the maximum contribution
cannot exceed the limitation in section 219(c) of the Code and no more than
$2,000 can be contributed to either spouse's IRA.
Except for direct transfers and rollovers described above, contributions
cannot be made after the end of the year in which the owner reaches age 69
1/2.
This Certificate cannot be used as a SIMPLE IRA under Section 408(p) of the
Code. It will not accept contributions otherwise permitted under Section
408(p) of the Code. Rollovers and transfers into this contract from a
SIMPLE IRA are prohibited during the two year period beginning on the date
that the owner first participated in a SIMPLE IRA plan maintained by his or
her employer.
3. The payment of dividends, if any, will be added to the certificate value
before the end of the calendar year following the declaration of dividends
under this
G-20247-568
<PAGE>
Certificate. Any refund of contributions (other than those attributable to
excess contributions) will be added to the certificate value before the
close of the calendar year following the year of the refund.
4. The entire interest of the owner will be distributed or commence to be
distributed, no later than the first day of April following the calendar
year in which the owner attains age 70 1/2 (the "Required Beginning Date"),
over (a) the life of the owner, or the lives of the owner and his or her
designated beneficiary, or (b) a period certain not extending beyond the
life expectancy of the owner and his or her designated beneficiary.
Payments must be made in periodic payments at intervals of no longer than
one year. In addition, payments must be either nonincreasing or they may
increase only as provided in Q&A F-3 Section 1.401(a)(9)-1 of the Proposed
Income Tax Regulations.
All distributions made hereunder shall be made in accordance with the death
benefit requirements of Section 401(a)(9)(G) of the Code, and the
requirements of Section 401(a)(9) of the Code, including the incidental
regulation thereunder, including the minimum distribution incidental
benefit requirement of Section 1.401(a)(9)-2 of the Proposed Income Tax
Regulations.
Life expectancy is computed by use of the expected return multiples in
Table V and VI of Section 1.72-9 of the Income Tax Regulations. Unless
otherwise elected by the owner by the time distributions are required to
begin, life expectancies shall not be recalculated annually. Such election
shall be irrevocable by the owner and shall apply to all subsequent years.
The life expectancy of a non-spouse beneficiary may not be recalculated.
Instead, life expectancy of a nonspousal beneficiary (or of the owner or
spousal beneficiary where the owner does not elect to recalculate life
expectancy) will be calculated using the attained age of such beneficiary (
or the attained age of the owner or spousal beneficiary, if an election to
recompute life expectancy is not made) during the calendar year in which
the owner attains age 70 1/2, and payments for subsequent years shall be
calculated based on such life expectancy reduced by one for each calendar
year which has elapsed since the calendar year life expectancy was first
calculated.
5. (a) Distributions Beginning Before Death.
If the owner dies after distribution of his or her interest has begun,
the remaining portion of such interest will continue to be distributed
at least as rapidly as under the method of distribution being used
prior to the owner's death.
(b) Distributions Beginning after Death.
2
<PAGE>
If the owner dies before distribution of his or her interest begins,
distribution of the owner's entire interest shall be completed by
December 31 of the calendar year containing the fifth anniversary of
the individual's death except to the extent that an election is made
to receive distributions in accordance with (1), (2) or (3) below:
(1) If the owner's interest is payable to a designated beneficiary,
then the entire interest of the owner may be distributed over
the life or over a period certain not greater than the life
expectancy of the designated beneficiary commencing on or before
December 31 of the calendar year immediately following the
calendar year in which the owner died.
(2) If the designated beneficiary is the owner's surviving spouse,
the date distributions are required to begin in accordance with
(1) above shall not be earlier than the later of (A) December 31
of the calendar year immediately following the calendar year in
which the owner died or (B) December 31 of the calendar year in
which the owner would have attained age 70 1/2.
(3) If the designated beneficiary is the owner's surviving spouse,
the spouse may treat the certificate as his or her own IRA. This
election will be deemed to have been made if such surviving
spouse makes a regular IRA contribution to the contract, makes a
rollover to or from such contract, or fails to elect any of the
above provisions.
(c) Life expectancy is computed by use of the expected return multiples in
Tables V and VI of Section 1.72-9 of the Income Tax Regulations. For
purposes of distributions beginning after the owner's death, unless
otherwise elected by the surviving spouse by the time distributions
are required to begin, life expectancies shall not be recalculated
annually. Such election shall be irrevocable by the surviving spouse
and shall apply to all subsequent years. In the case of any other
designated beneficiary (or in the case of a spousal beneficiary who
does not elect to recalculate life expectancy), life expectancies
shall be calculated using the attained age of such beneficiary during
the calendar year in which distributions are required to begin
pursuant to this section, and payments for any subsequent calendar
year shall be calculated based on such life expectancy reduced by one
for each calendar year which has elapsed since the calendar year life
expectancy was first calculated.
(d) Distributions under this section are considered to have begun if
distributions are made on account of the owner reaching his or her
required beginning date or if prior to the required beginning date
distributions irrevocably commence to an individual over a period
3
<PAGE>
permitted and in an annuity form acceptable under section 1.401(a)(9)
of the Regulations.
(e) Minimum distribution requirements may be satisfied by receiving a
distribution from one Individual Retirement Account or Individual
Retirement Annuity (collectively, "IRAs"), that is equal to the amount
required to satisfy the minimum distribution requirements for two or
more IRAs. For this purpose, the owner of two or more IRAs may use an
alternative method to satisfy the minimum distribution requirements.
6. The entire interest of the owner is nonforfeitable and nontransferable.
7. The Company will furnish annual calendar year reports concerning the
status of this Certificate to the owner, to the Internal Revenue Service
and to such other persons as required under the Code and the regulations
thereunder.
8. In order to continue to qualify this Certificate under Section 408(b) of
the Code, the Company may amend this Endorsement to reflect changes in the
provisions of the Code and related regulations. We will notify the owner
of any amendments and, when required by law, we will obtain the approval
of the appropriate regulatory authority.
/s/ Louis J. Ragusa
4
<PAGE>
Exhibit 4(b)(xiv)
METLOGO
METROPOLITAN LIFE INSURANCE COMPANY
One Madison Avenue, New York, NY 10010-3690
ENDORSEMENT
This Endorsement amends the Tax Sheltered Annuity ("TSA") Certificate to which
it is attached.
No withdrawal charge will apply to withdrawals from this TSA Certificate if,
at the time the Certificate is issued, you have already retired or separated
from service with your TSA employer.
-S- -S-
Louis J: Ragusa Harry P. Kamen
Vice-President & Secretary Chairman, President and Chief
Executive Officer
G.20247-563
<PAGE>
Exhibit 4(f)(vi)
Met Logo
Metropolitan Life Insurance Company
One Madison Avenue, New York, NY 10010-3690
ENDORSEMENT
In order to comply with the trust requirements of the Small Business Jobs
Protection Act of 1996 for state and local government 457(b) plans, the Group
Annuity Contract that this Endorsement is attached to, is amended as follows:
If the plan sponsor is the owner of the contract:
Notwithstanding any provision of this contract to the contrary, the
Contractholder, as trustee and owner of the annuity contract, shall hold all
Plan assets held under this annuity contract for the exclusive benefit of plan
participants and beneficiaries. The group annuity contract shall be treated as a
trust for purposes of Code Sections 457(g) and 401(f), and no portion of the
amount deposited into the contract, or the earnings thereon, may be used for, or
diverted to, any purpose other than for the exclusive benefit of plan
participants and beneficiaries prior to the satisfaction of all liabilities with
respect to employees and their beneficiaries.
This Endorsement is attached to and made part of the Contract.
/s/ Louis J. Ragusa
G.7812-45
<PAGE>
Exhibit 4(h)(i)(E)
Met Logo
Metropolitan Life Insurance Company
One Madison Avenue, New York, NY 10010-3690
ENDORSEMENT
This Endorsement amends the annuity contract to which it is attached.
Any death claim settlement will be made within 60 days of receipt of the
certified death certificate, the annuity contract, and proof of the claimant's
right to the death claim settlement. If the death claim settlement is made after
30 days of such receipt, the death claim settlement shall include interest from
the 30th day until the date of settlement. Such interest will be no less than
the discount rate on 90-day commercial paper in effect at the Federal Reserve
Bank in the ninth Federal Reserve District on the date of receipt of the
certified death certificate.
/s/ Louis J. Ragusa
R.S. 1234MT 1998
<PAGE>
Exhibit 4(h)(i)(F)
Metropolitan Life Insurance Company
(A Mutual Company Incorporated in New York State)
in consideration of the deposits it receives under this contract, will pay the
benefits of this contract according to its provisions. The contract holder and
MetLife execute this contract in duplicate to take effect as of the issue
date.
By: Metropolitan Life Insurance Company
----------------------------
- --------------------------------
Louis J. Ragusa, Vice-President and Secretary
- --------------------------------
- -------------------------------- Robert H. Benmosche, President and Chief
Operating Officer
- -------------------------------- ---------------------------------------------
Registrar
Date
---------------------------------------------
City and State
---------------------------------------------
SPECIFICATIONS
Group Annuity Contract Number S123456789
Contract Date Month xx, 19yy
Contract holder ABC Hospital trust
Market Non-Qualified
ALL VALUES PROVIDED BY THIS CONTRACT WHICH ARE BASED ON THE
INVESTMENT EXPERIENCE OF THE SEPARATE ACCOUNT ARE VARIABLE AND ARE
NOT GUARANTEED AS TO AMOUNT. AVAILABLE SEPARATE ACCOUNT INVESTMENT
DIVISIONS AS OF THE CONTRACT DATE ARE: [THE METROPOLITAN GROWTH,
INCOME, DIVERSIFIED, AGGRESSIVE GROWTH, MONEY MARKET, INTERNATIONAL
STOCK AND STOCK INDEX DIVISIONS; THE FIDELITY GROWTH, OVERSEAS,
EQUITY INCOME, MONEY MARKET, INVESTMENT GRADE BOND, and ASSET
MANAGER DIVISIONS; and THE CALVERT SOCIALLY RESPONSIBLE and ARIEL
DIVISIONS]. A DESCRIPTION OF EACH OF THESE DIVISIONS IS INCLUDED IN
THE PROSPECTUS.
This contract is not eligible for dividends--see item 10.
PLEASE READ THIS CONTRACT CAREFULLY
See Index on Last Page
Cover Page
Form G.3043
<PAGE>
1. What do the basic terms in my contract mean?
"Account Balance" is the entire amount we hold under this contract for
you.
"Code" means the Internal Revenue Code of 1986, as amended.
"Contract Year" for the first year is measured from the contract date and
continues to [the next December 31st. Each new contract year begins on
January 1st. For example, if the contract date is May 15, 1995, the first
contract year ends December 31, 1995 and the second contract year begins
January 1, 1996.]
"Deposits" are your payments to us under this annuity contract. We will
only accept deposits into this contract that are made under the Plan.
["Deposit Year" for any deposit, for the first year, is measured from the
date we receive it in our designated office and continues until the last
day of the month in which the anniversary of such receipt occurs. Each
new deposit year begins on the first day of the next month.]
"Designated Office" is the administrative office servicing your contract.
It is currently the Pension and Savings Center, Metropolitan Life
Insurance Company, 1125 17th Street, Denver, Co. 80202. If we change it,
we will tell you.
"Employer" is the institution that has adopted the Plan.
"Funding Options" refer to [the Metropolitan Series Fund, Inc., the
Calvert Socially Responsible Series, the Calvert Ariel Appreciation
Portfolio II, and Fidelity's Variable Insurance Products Fund and
Variable Insurance Products Fund II. All are either mutual funds or
series of mutual funds used only for insurance and annuity contracts such
as this one. The Metropolitan Series Fund and Fidelity's Variable
Insurance Products Fund and Variable Insurance Products Fund II are
divided into portfolios each of which has its own investment objectives].
"Investment Divisions" are part of the Separate Account. Each division
invests in a corresponding portfolio or series of the Funding Options,
rather than investing directly in stocks, bonds or other investments.
Thus, the investment experience of each division will generally be the
same as that of the corresponding portfolio or series, reduced by charges
under this contract for services and benefits we provide. The cover page
shows the available divisions. We
1
<PAGE>
will tell you about any changes.
"Participant" is any person who participates in the employer's plan.
"Plan" is a plan adopted by the employer which meets the requirements for
Section [457(f) deferred compensation plans] [451 deferred compensation
plans] [457(e)(11) severance and death benefit plans] of the Code.
"We", "Us", "MetLife" and "Our" refer to Metropolitan Life Insurance
Company.
"You", "Your", "Me" "My" and "I" refer to the trustee of the grantor
trust that has been established pursuant to Section [457(f)] [451]
[457(e)(11)] of the Code and that has arranged with us to use this
contract for the purchase of annuities under the Plan. You may exercise
all rights under this contract.
2. How are deposits recorded under this contract?
Deposits and earnings on those deposits are credited to the contract as a
whole, rather than to individual participants. We do not keep individual
participant records under this contract, which is a funding vehicle not a
plan document.
3. How are deposits allocated and how much money can be deposited under my
contract?
You choose how deposits are allocated among the Fixed Interest Account
and the investment divisions of the Separate Account. You may change your
allocation for new deposits by telling us. The change will be made upon
receipt, unless you specify a later date. Allocations must be in whole
number percentages (e.g., 33 1/3% cannot be chosen).
Annuity deposits may be made at any time while this contract is in
effect. All deposits should be sent to our designated office. No deposit
will be credited before the contract date.
We will accept each amount you deposit up to [$500,000 per contract
year.] [The minimum cumulative deposit that we will accept is $15,000
during the first contract year and $5,000 per contract year thereafter.]
We will not accept any deposits after you have requested a full
withdrawal (unless you cancel it) or accept any deposit less than
[$2,000.] We may either return amounts which violate these limits or
agree to take them. We may change them by telling you at least 90 days in
advance.
2
<PAGE>
4. Can my contract be canceled?
If a deposit has not been made for [12] consecutive months and the
account balance is less than [$2,000], we may, if permitted by law,
cancel this contract by paying you the account balance in a single sum.
5. Can I make withdrawals?
Yes. To request a withdrawal you may contact our designated office. Any
withdrawal request must be signed by you and must clearly state the
account (and investment division, if any) from which the withdrawal is to
be made. The minimum withdrawal is $500 or your entire account or
division balance, if less. There are no early withdrawal charges.
If you make a partial withdrawal from the Fixed Interest Account, we will
first withdraw any amounts from deposits and will then withdraw other
amounts from any interest on deposits, in each case on a "first-in,
first-out" (FIFO) basis. To determine from what amounts a withdrawal is
taken for tax purposes, we will apply tax rules which may be different.
As required by law we have the right to delay paying any cash withdrawals
from the Fixed Interest Account for up to six months. We do not intend to
do this except in an extreme emergency. We would, of course, credit
interest during any delay.
6. What is the Fixed Interest Account and how is interest credited to it?
We credit interest on each deposit from the date it is received at our
designated office or transferred from the Separate Account until the date
you withdraw it or transfer it to the Separate Account or use it to have
income payments made to any person entitled to such payments.
Interest rates for amounts added to the Fixed Interest Account will be
set by us [from time to time] [as of each January 1, April 1, July 1 and
October 1.] The declared rate in effect when an amount is added to the
Fixed Interest Account will be credited on that amount from the date it
is added until the last day of the [contract year in which it is added]
[calendar year following the year in which it is added] [first deposit
year].
Thereafter, we will set interest rates for these amounts (and earnings on
them) on or before the first day of each [calendar] [deposit] [contract
year] year to be credited through the last day of such year.
3
<PAGE>
We may have one interest rate for deposits resulting from the tax-free
transfer or exchange of Section [457(f)] [451] [457(e)(11)] annuity money
from other contracts and a different interest rate for other amounts
added to the Fixed Interest Account. The rates for such transfers and
exchanges or other amounts added to the Fixed Interest Account may be
different than the rates credited on amounts already in the Fixed
Interest Account. The rates may also vary depending on the amount of the
account balance.
The interest rates we declare are "annual effective yields". The actual
rates we use on a day-to-day basis are slightly lower, but, if the amount
added is left in the Fixed Interest Account for a full year, it will grow
by the full amount of the interest rate we declared, because we compound
interest daily.
7. What is the Separate Account and how does it operate?
It is MetLife Separate Account E, an investment account we maintain
separate from our other assets.
We own the assets in the Separate Account. The Separate Account will not
be charged with liabilities that arise from any other business that we
conduct. We will add amounts to the Separate Account from other contracts
of ours.
The Separate Account is divided into investment divisions, each of which
buys shares in a corresponding portfolio or series of the Funding
Options. Thus, the Separate Account does not invest directly in stocks,
bonds, etc., but leaves such investments to the Funding Options to make.
The Funding Options are also bought by other separate accounts of ours,
our affiliates and other insurance companies.
We keep track of each investment division of the Separate Account
separately using accumulation units. When you put money into an
investment division, we give you accumulation units. When you take money
out of the investment division, we reduce the number of your accumulation
units. In either case, the number of accumulation units you gain or lose
is determined by taking the dollar amount of the deposit, transfer or
withdrawal and dividing it by the value of an accumulation unit at the
time of the transaction. Thus, if you transfer in $5,000, and the value
of an accumulation unit is $100, you will get 50 accumulation units.
Initially, we set the value of each accumulation unit. At the end of each
valuation period, we then revise it by taking the net asset value of a
share in the applicable Funding Option portfolio or series at the end of
the valuation period, add any Funding Option dividend or capital gain
distribution during the valuation period, subtract any
4
<PAGE>
per share charge for taxes and reserves for taxes, and divide this total
by the net asset value of a share of the same portfolio or series at the
start of the valuation period. Then we subtract a charge not to exceed
[.000025905] per day (an effective annual rate of [.95%]) for
administrative expenses and mortality and expense risks we assume under
the certificate. This calculation results in a factor that we multiply
the previous accumulation unit value by in order to determine the new
accumulation unit value.
A valuation period is the period between one calculation of an
accumulation unit value and the next calculation. Normally, we calculate
accumulation units once each day the New York Stock Exchange is open for
trading, but we can delay this determination if an emergency exists,
making valuation of assets in the Separate Account not reasonably
practicable, or the Securities and Exchange Commission permits such
deferral. We may change when we calculate the accumulation unit value, to
the extent permitted by law, by giving you 30 days notice.
Amounts added to the Separate Account will be credited as of the end of
the valuation period during which we receive them at our designated
office or they are transferred from the Fixed Interest Account. Additions
to or withdrawals from an investment division may only be made as of the
end of a valuation period.
We may make certain changes to the Separate Account if we think they
would best serve the interests of participants in or owners of similar
contracts or would be appropriate in carrying out the purposes of such
contracts. Any changes will be made only to the extent and in the manner
permitted by applicable laws. Also, when required by law, we will obtain
your approval of the changes and approval from any appropriate regulatory
authority.
Examples of the changes to the Separate Account that we may make include:
o To transfer any assets in an investment division to another
investment division, or to one or more other separate accounts, or
to our general account; or to add, combine, or remove investment
divisions in the Separate Account.
o To substitute, for the Funding Option shares held in any investment
division, the shares of another class of the Metropolitan Series
Fund, Inc. or any other investment permitted by law.
If any changes result in material change in the underlying
5
<PAGE>
investments of an investment division to which an amount is allocated
under this contract, we will notify you of the change. You may then make
a new choice of investment divisions.
B. Can money be transferred within this contract?
Yes. A transfer can be made between investment divisions of the Separate
Account, from an investment division to the Fixed Interest Account, or
from the Fixed Interest Account to an investment division. [You can make
an unlimited number of transfers by telling us.]
If you make a transfer from the Fixed Interest Account, we will determine
which deposits and interest to take it from as if it was a withdrawal
from the contract. [However, only one transfer per contract year can be
made from the Fixed Interest Account to the Separate Account and only up
to 20% of the Fixed Interest Account balance may be transferred.] If you
transfer money from the Fixed Interest Account to the Separate Account
and then you transfer money from the Separate Account to the Fixed
Interest Account within 12 months, this will be treated as a return of
the same money (whether or not it really is). Thus, after the transfer
into the Fixed Interest Account, it will earn the same interest rate that
it would have been earning had neither transfer ever taken place. Any
amounts in excess of the original transfer and any amounts transferred
back to the Fixed Interest Account more than 12 months after the first
transfer will be treated as a new deposit to the Fixed Interest Account
and will earn the current interest rate for new deposits.
9. May I assign or transfer this contract, or use it as collateral for a
loan?
No. This contract and amounts paid under it are not transferrable and may
not be assigned, sold, discounted or pledged as collateral for a loan. To
the extent permitted by law, no amount payable under this contract is
subject to legal process or attachment for payment of any claim against
any payee. This provision will not prevent assignment of this contract to
the sponsor or a trustee of the Plan, or that of another plan if the Plan
is consolidated or merged with such other plan.
10. Are dividends payable under my contract?
No. Your contract is nonparticipating and does not share in any
distribution of our surplus.
6
<PAGE>
11. Are administrative fees deducted from my contract?
No. We charge no administrative fees under this contract.
12. How can I get information about my contract and its value?
At least twice each contract year (except the first contract year),
before income payments start, we will send you a statement with details
on deposits, values, withdrawals, and other information about your
contract. If you need information at other times, please tell us.
Any time you have to tell us something (e.g., to request additional
information, to make transfers, to change your allocation for new
deposits, to make withdrawals), you must send written notice to our
designated office unless we have set up some other procedure, such as
notice by telephone.
13. Can we guarantee an income for as long as a participant lives?
Yes. We can make income payments guaranteed for the life of a participant
on a monthly, quarterly, semiannual or annual basis. These payments may
also be guaranteed for at least five years, but not beyond the
participant's life expectancy or the joint life expectancy if there is
more than one payee.
Other income plans which provide payments for a stated amount or a stated
number of years are also available to the extent permitted by Federal
income tax rules, under Code Section 72 including regulations thereunder.
The amount of each payment under an income plan must be at least [$50].
When you buy an income plan, we will withdraw the amount you tell us in a
lump sum to pay for it. We will begin making income payments at any date
you choose after the contract date (subject to any applicable federal
rules and regulations), if you tell us at least 30 days in advance. We
will send you information and the necessary forms to sign, upon receipt
of your request at our designated office. Once income payments start, you
will not be able to change the choice of income plan.
Guaranteed income plan payments, which are based on a 3% interest rate
and the 1983 Individual Mortality Table a (Metropolitan adjusted), are
provided on page 10. These payments are at least as high as those
required by the laws of the state where this contract is delivered and
are at least equal to those that we would provide to a person in the same
class as the participant under a single payment immediate annuity bought
at the same time.
7
<PAGE>
You will be the owner of any income plan purchased.
14. What happens if a participant dies before income payments start?
After we receive proof of death and a properly completed claim form, we
will pay the death benefit (as of the date of settlement) to you. The
death benefit for any participant is the entire account balance held on
behalf of that participant as of the date we receive proof of death and a
properly completed claim form. Proof of death, as well as proof of the
share of the account balance attributable to the participant satisfactory
to us, must be given if we ask for it.
The entire death benefit for a participant under this contract must be
distributed in a single sum within five years of the participant's death.
If, however, you choose on behalf of the payee an income plan for life or
for a period of years not more than his or her life expectancy, the
income payments must begin within one year of the participant's death. If
Treasury regulations allow, we may permit payments to start later.
15. What happens if an annuitant dies after income payments start?
After we receive proof of death and a properly completed claim form,
income payments will continue to the annuitant's beneficiary for the
balance of the guaranteed period, if any, for the income plan you
selected. If the guaranteed period has already ended, no further payments
will be made. If you name no beneficiary (or none is alive when you die),
we will pay the contingent beneficiary. If you name no contingent
beneficiary (or none is alive when you die), we will pay your estate. If
the annuitant's estate (or other non-individual) becomes entitled to
payment, we will pay the value of any remaining payments, computed as of
the date of death using the interest rate we use to set those payments, in
a lump-sum.
16. Will a certificate be provided for persons who receive income payments?
Yes. MetLife will issue to the Contract holder, for delivery to each
person to whom annuity benefits are being paid under this contract, an
individual certificate outlining the benefits payable under the income
plan.
17. Does my contract contain all the provisions that affect me?
Yes, your contract and any riders and endorsements included in it make up
your entire contract with us. We will never
8
<PAGE>
contest the validity of this contract. Changes in its provisions may only
be made in writing by our President, Secretary, or a Vice-President. No
provision may be waived or changed by any of our other employees,
representatives or agents.
To comply with Section 72 of the Code and applicable Treasury
Regulations, we may, if necessary, amend this contract. We will notify
you of any amendments and, when required by law, we will obtain your
approval and the approval of the appropriate regulatory authority.
9
<PAGE>
GUARANTEED ANNUITY BENEFITS
<TABLE>
<CAPTION>
Monthly Income Payments Per $1,000 Used to Buy Income Plan
Payee's
Exact Age on Life Income Term Certain and Life Income
Date of Purchase If Term Certain Period is:
of Income Plan 10 Years 15 Years 20 Years
<S> <C> <C> <C> <C>
55 $3.85 $3.83 $3.80 $3.75
56 $3.91 $3.89 $3.85 $3.80
57 $3.98 $3.95 $3.91 $3.85
58 $4.05 $4.01 $3.97 $3.91
59 $4.12 $4.08 $4.03 $3.96
60 $4.19 $4.15 $4.10 $4.02
61 $4.27 $4.23 $4.17 $4.08
62 $4.36 $4.31 $4.24 $4.14
63 $4.45 $4.39 $4.31 $4.20
64 $4.54 $4.48 $4.39 $4.26
65 $4.64 $4.57 $4.47 $4.33
66 $4.75 $4.67 $4.55 $4.39
67 $4.86 $4.77 $4.64 $4.46
68 $4.99 $4.88 $4.73 $4.52
69 $5.11 $4.99 $4.82 $4.59
70 $5.25 $5.11 $4.92 $4.65
<CAPTION>
Joint and Survivor Life Income Plan
Payee's Monthly Income Payment to Primary Payee per $1,000 Used to Buy Income Plan if
Exact Age on Percentage of Monthly Income Payment Payable to the Survivor Payee is:
Date of Purchase
of Income Plan* 50% 66 2/3% 75% 100%
<S> <C> <C> <C> <C>
55 and 60 $3.68 $3.63 $3.60 $3.52
60 and 55 $3.83 $3.72 $3.67 $3.52
60 and 60 $3.91 $3.82 $3.78 $3.66
60 and 65 $3.97 $3.91 $3.87 $3.78
65 and 60 $4.16 $4.03 $3.96 $3.78
65 and 65 $4.26 $4.15 $4.10 $3.94
70 and 65 $4.61 $4.43 $4.35 $4.11
70 and 70 $4.76 $4.61 $4.54 $4.35
</TABLE>
* In each pair of ages, the first age is the primary payee's age and the
second age is the survivor payee's age.
Term Certain Income Plan
Monthly Income Payment Per $1,000 Used to Buy Income Plan
If Term Certain Period is:
10 Years 15 Years 20 Years
$9.37 $6.70 $5.37
10
<PAGE>
INDEX
Subject
Administrative Fees
Assignment
Allocation of Deposits
Cancellation
Certificate
Contract and Authority
Death Benefit
Definitions
Dividends
Fixed Interest Account 6
Income Payments 13
Information We Give You 12
Recording Deposits 2
Separate Account and Investment Divisions 7
Transfers 8
Withdrawals 5
NOTICE
When you write to us, please give us your name, address and contract number.
Please notify us promptly of any address changes. We will write to you at your
last known address.
Checks, drafts or money orders must be drawn to the order of MetLife. All
payments must be made in U.S. currency.
Multifunded Annuity Contract
ALL VALUES PROVIDED BY THIS CONTRACT WHICH ARE BASED ON THE INVESTMENT
EXPERIENCE OF THE SEPARATE ACCOUNT ARE VARIABLE AND ARE NOT AMOUNT.
PLEASE READ THIS CONTRACT CAREFULLY
11
<PAGE>
Exhibit 4(r)(i)
METLOGO
METROPOLITAN LIFE INSURANCE COMPANY
(A Mutual Company Incorporated in New York State)
One Madison Avenue--New York, New York 10010-3690
ENDORSEMENT
This Endorsement amends Item 7 of the Single Premium Immediate Income Payment
Contract to which it is attached, as follows:
The limitation on the number of investment divisions to and from which you can
make transfers will no longer apply. You may transfer money to or from any
available investment division.
-S- -S-
Louis J. Ragusa Harry P. Kamen
Vice-President & Secretary Chairman, President and Chief
Executive Officer
G.20247-560
<PAGE>
Exhibit 4(w)
Met Logo
Metropolitan Life Insurance Company
One Madison Avenue, New York, NY 10010-3690
ENDORSEMENT
1) Enhanced Free Corridor
This Endorsement amends your annuity contract to allow more than one withdrawal
in a contract year, free of withdrawal charges, if the total amount withdrawn
equals 10 percent or less of your Account Balance. Currently, your contract
allows for a 10 percent "free corridor" whereby you can withdraw up to 10
percent of your Account Balance free of withdrawal charges for the first
withdrawal in a contract year.
How It Works: If your first withdrawal in a contract year is less than 10
percent of your Account Balance, you may now make additional withdrawals during
that contract year without incurring withdrawal charges, provided that the total
of your withdrawal percentages is 10 percent or less. A percentage is determined
separately for each withdrawal.
Example: If you withdraw $1,000 when your Account Balance is $20,000, this would
be a 5.00 percent withdrawal. If you make an additional withdrawal (during the
same contract year) when your Account Balance is $19,000 (assumes no change in
Account Balance), $950 could be withdrawn (5.00 percent of $19,000) free of
withdrawal charges.
2) The Systematic Withdrawal Program
This Endorsement also amends the payment period for your annuity contract's
Systematic Withdrawal Program, in order to align it with your contract year. The
Systematic Withdrawal Program enables you to make withdrawals from your contract
monthly, quarterly, semiannually or annually. Your systematic withdrawal is
considered a single withdrawal each period made in a series of payments. You may
receive these withdrawal payments as a specific dollar amount or a percentage of
your Account Balance. You may stop the Systematic Withdrawal Program at any
time, but you may restart it only once each contract year.
How It Works: If you select systematic withdrawals as a percentage of your
Account Balance, you will be paid the full percentage for the remainder of the
contract year. On the date of the first payment after the next contract
anniversary, we will recalculate the amount of your withdrawal under the
Systematic Withdrawal Program based on the Account Balance at that time. If you
select systematic withdrawals as a dollar amount, the full amount paid out
during the contract year will be treated as though it was paid out on the date
of your first systematic withdrawal payment, for the purpose of applying the 10
percent exemption from contract withdrawal charges.
R.S. 1222 (37PP-90(NQ-1),38PP-90(IRA-1))
<PAGE>
Example: If your Account Balance is $12,000 and you request a 10 percent
withdrawal under the Systematic Withdrawal Program to be paid monthly, you will
receive: $100 per month if there are 12 months in that contract year; $200 per
month if there are six months left in that contract year; or $1,200 per month if
there is one month left in that contract year. If you ask for $100 per month, we
will pay this amount until you tell us to change it (or until your Account
Balance is used up if sooner). We will do so regardless of contract years or
what amounts you are allowed to withdraw without a withdrawal charge in later
contract years.
/s/ Louis J. Ragusa
<PAGE>
Exhibit 4(w)
Met Logo
Metropolitan Life Insurance Company
One Madison Avenue, New York, NY 10010-3690
ENDORSEMENT
1) Enhanced Free Corridor
This Endorsement amends your annuity contract to allow more than one withdrawal
in a contract year, free of withdrawal charges, if the total amount withdrawn
equals 10 percent or less of your Account Balance. Currently, your contract
allows for a 10 percent "free corridor" whereby you can withdraw up to 10
percent of your Account Balance free of withdrawal charges for the first
withdrawal in a contract year.
How It Works: If your first withdrawal in a contract year is less than 10
percent of your Account Balance, you may now make additional withdrawals during
that contract year without incurring withdrawal charges, provided that the total
of your withdrawal percentages is 10 percent or less. A percentage is determined
separately for each withdrawal.
Example: If you withdraw $1,000 when your Account Balance is $20,000, this would
be a 5.00 percent withdrawal. If you make an additional withdrawal (during the
same contract year) when your Account Balance is $19,000 (assumes no change in
Account Balance), $950 could be withdrawn (5.00 percent of $19,000) free of
withdrawal charges.
2) The Systematic Withdrawal Program
This Endorsement also amends the payment period for your annuity contract's
Systematic Withdrawal Program, in order to align it with your contract year. The
Systematic Withdrawal Program enables you to make withdrawals from your contract
monthly, quarterly, semiannually or annually. Your systematic withdrawal is
considered a single withdrawal each period made in a series of payments. You may
receive these withdrawal payments as a specific dollar amount or a percentage of
your Account Balance. You may stop the Systematic Withdrawal Program at any
time, but you may restart it only once each contract year.
Your 10 percent free corridor is available each contract year under the
Systematic Withdrawal Program, whether you request a percentage of your Account
Balance or a specific dollar amount for your systematic withdrawal payments. You
may change the percentage amount or dollar amount each succeeding contract year
or once during each contract year by stopping and then restarting systematic
withdrawals.
How It Works: If you select systematic withdrawals as a percentage
of your Account Balance, you will be paid the full percentage for the remainder
of the contract year. On the date of the first payment after the next contract
anniversary, we will recalculate the amount of your withdrawal
R.S.1222NJ
<PAGE>
under the Systematic Withdrawal Program based on the Account Balance at that
time. If you select systematic withdrawals as a dollar amount, the full amount
paid out during the contract year will be treated as though it was paid out on
the date of your first systematic withdrawal payment, for the purpose of
applying the 10 percent exemption from contract withdrawal charges.
Example: Assuming your Account Balance is $12,000 with no prior withdrawals in
the contract year and you request a 10 percent withdrawal under the Systematic
Withdrawal Program to be paid monthly, you will receive: $100 per month if there
are 12 months in that contract year; $200 per month if there are six months left
in that contract year; or $1,200 per month if there is one month left in that
contract year.
Assuming your Account Balance is $12,000 with no withdrawals during the contract
year, and you request $100 per month with six months remaining in your contract
year, we will calculate that you have requested 5 percent of your Account
Balance for that contract year and pay you the monthly amount requested. You
would still be eligible for another 5 percent withdrawal in the same contract
year without withdrawal charges. In the next contract year, we would continue to
pay you $100 monthly, unless you requested another amount.
/s/ Louis J. Ragusa
<PAGE>
Exhibit 4(w)
Met Logo
Metropolitan Life Insurance Company
One Madison Avenue, New York, NY 10010-3690
ENDORSEMENT
Enhanced Free Corridor
This Endorsement amends your annuity contract to allow more than one withdrawal
in a contract year, free of withdrawal charges, if the total amount withdrawn
equals 10 percent or less of your Account Balance. Currently, your contract
allows for a 10 percent "free corridor" whereby you can withdraw up to 10
percent of your Account Balance free of withdrawal charges for the first
withdrawal in a contract year.
How It Works: If your first withdrawal in a contract year is less than 10
percent of your Account Balance, you may now make additional withdrawals during
that contract year without incurring withdrawal charges, provided that the total
of your withdrawal percentages is 10 percent or less. A percentage is determined
separately for each withdrawal.
Example: If you withdraw $1,000 when your Account Balance is $20,000, this would
be a 5.00 percent withdrawal. If you make an additional withdrawal (during the
same contract year) when your Account Balance is $19,000 (assumes no change in
Account Balance), $950 could be withdrawn (5.00 percent of $19,000) free of
withdrawal charges.
/s/ Louis J. Ragusa
R.S.1232
<PAGE>
Exhibit 4(w)
MET LOGO
Metropolitan Life Insurance Company
One Madison Avenue, New York, NY 10010-3690
ENDORSEMENT
1) Enhanced Free Corridor
This Endorsement amends your annuity certificate to allow more than one
withdrawal in a certificate year, free of withdrawal charges, if the total
amount withdrawn equals 10 percent or less of your Account Balance. Currently,
your certificate allows for a 10 percent "free corridor" whereby you can
withdraw up to 10 percent of your Account Balance free of withdrawal charges for
the first withdrawal in a certificate year.
How It Works: If your first withdrawal in a certificate year is less than 10
percent of your Account Balance, you may now make additional withdrawals during
that certificate year without incurring withdrawal charges, provided that the
total of your withdrawal percentages is 10 percent or less. A percentage is
determined separately for each withdrawal.
Example: If you withdraw $1,000 when your Account Balance is $20,000, this would
be a 5.00 percent withdrawal. If you make an additional withdrawal (during the
same certificate year) when your Account Balance is $19,000 (assumes no change
in Account Balance), $950 could be withdrawn (5.00 percent of $19,000) free of
withdrawal charges.
2) The Systematic Withdrawal Program
This Endorsement also amends the payment period for your annuity certificate's
Systematic Withdrawal Program, in order to align it with your certificate year.
The Systematic Withdrawal Program enables you to make withdrawals from your
certificate monthly, quarterly, semiannually or annually. Your systematic
withdrawal is considered a single withdrawal each period made in a series of
payments. You may receive these withdrawal payments as a specific dollar amount
or a percentage of your Account Balance. You may stop the Systematic Withdrawal
Program at any time, but you may restart it only once each certificate year.
G.20247-573
<PAGE>
How It Works: If you select systematic withdrawals as a percentage of your
Account Balance, you will be paid the full percentage for the remainder of the
certificate year. On the date of the first payment after the next certificate
anniversary, we will recalculate the amount of your withdrawal under the
Systematic Withdrawal Program based on the Account Balance at that time. If you
select systematic withdrawals as a dollar amount, the full amount paid out
during the certificate year will be treated as though it was paid out on the
date of your first systematic withdrawal payment, for the purpose of applying
the 10 percent exemption from certificate withdrawal charges.
Example: If your Account Balance is $12,000 and you request a 10 percent
withdrawal under the Systematic Withdrawal Program to be paid monthly, you will
receive: $100 per month if there are 12 months in that certificate year; $200
per month if there are six months left in that certificate year; or $1,200 per
month if there is one month left in that certificate year. If you ask for $100
per month, we will pay this amount until you tell us to change it (or until your
Account Balance is used up if sooner). We will do so regardless of certificate
years or what amounts you are allowed to withdraw without a withdrawal charge in
later certificate years.
-S-
Louis J. Ragusa
Vice-President & Secretary
<PAGE>
Exhibit 4(x)
Met Logo
Metropolitan Life Insurance Company
One Madison Avenue, New York, New York 10010-3690
ENDORSEMENT
This Endorsement amends the Multifunded Annuity Contract to which it is
attached.
The cover page is amended to add the following as available Investment Divisions
as of the later of the Contract Date or November 1, 1998.
Harris Oakmark Large Cap Value Division
Lehman Brothers Aggregate Bond Index Division
Morgan Stanley EAFE(R) Index Division
Neuberger & Berman Partners Mid Cap Value Division
Russell 2000 Index Division
Santander International Stock Division
T. Rowe Price Large Cap Growth Division
In addition, the names of certain Investment Divisions currently available are
being changed effective November 1, 1998.
CURRENT NAME REVISED NAME
Aggressive Growth Division State Street Research Aggressive Growth Division
Diversified Division State Street Research Diversified Division
Growth Division State Street Research Growth Division
Income Division State Street Research Income Division
Stock Index Division MetLife Stock Index Division
/s/ Louis J. Ragusa
/s/ Robert H. Benmosche
R.S. 1230 (11/98)
<PAGE>
Exhibit 4(x)
Met Logo
Metropolitan Life Insurance Company
One Madison Avenue, New York, New York 10010-3690
ENDORSEMENT
This Endorsement amends the Single Premium Immediate Income Payment Contract to
which it is attached.
The cover page is amended to add the following as available Investment Divisions
as of the later of the Contract Date or November 1, 1998.
Harris Oakmark Large Cap Value Division
Lehman Brothers Aggregate Bond Index Division
Morgan Stanley EAFE(R) Index Division
Neuberger & Berman Partners Mid Cap Value Division
Russell 2000 Index Division
Santander International Stock Division
T. Rowe Price Large Cap Growth Division
In addition, the names of certain Investment Divisions currently available are
being changed effective November 1, 1998.
CURRENT NAME REVISED NAME
Aggressive Growth Division State Street Research Aggressive Growth Division
Diversified Division State Street Research Diversified Division
Growth Division State Street Research Growth Division
Income Division State Street Research Income Division
Stock Index Division MetLife Stock Index Division
/s/ Louis J. Ragusa
/s/ Robert H. Benmosche
R.S. 1231 (11/98)
<PAGE>
Exhibit 4(x)
METLOGO
Metropolitan Life Insurance Company
One Madison Avenue, New York, New York 10010-3690
ENDORSEMENT
This Endorsement amends the Multifunded Annuity Contract to which it is
attached.
The cover page is amended to add the following as available Investment Divisions
as of the later of the Contract Date or [November 1, 1998].
[Harris Oakmark Large Cap Value Division
Lehman Brothers Aggregate Bond Index Division
Morgan Stanley EAFE Index Division
Neuberger & Berman Partners Mid Cap Value Division
Russell 2000 Index Division
T. Rowe Price Large Cap Growth Division]
In addition, the names of certain Investment Divisions currently available are
being changed effective [November 1, 1998].
CURRENT NAME REVISED NAME
- ------------ ------------
[Aggressive Growth Division State Street Research Aggressive Growth
Diversified Division State Street Research Diversified Division
Growth Division State Street Research Growth Division
Income Division State Street Research Income Division
International Stock Division State Street Research International Stock Division
Stock Index Division MetLife Stock Index Division]
- -S- -S-
Louis J. Ragusa Robert H. Benmosche
Vice-President & Secretary Chairman of the Board
President and Chief Executive Officer
G.20247-572
<PAGE>
Exhibit 4(y)
Met Logo
METROPOLITAN LIFE INSURANCE COMPANY
(A Mutual Company Incorporated in New York State)
One Madison Avenue, New York, NY 10010-3690
ENDORSEMENT
The contract to which this endorsement is attached is amended as follows:
We may allow money held under one or more other MetLife contracts to be
transferred to this contract without imposing the withdrawal charge under the
other contracts. If we do so, the following provisions will apply to the amount
transferred:
1. If the "Right to Examine" provision of this contract is exercised, the
transfer will be reversed and we will reinstate the other contracts (or pay
you their cash withdrawal values, if you ask, after imposing any applicable
withdrawal charges).
2. The interest rates we credit on any portion of the transferred amount
allocated to the Fixed Interest Account may be different from the interest
rate we credit on other deposits.
3. The withdrawal charge schedule that will apply to the amount transferred
will be the withdrawal charge schedule that would normally apply to
deposits under this contract treating each deposit as if it had been
deposited into this contract on the date it was deposited into the other
MetLife contracts.
4. Despite any provision in the contract to the contrary, withdrawal charges
may reduce the cash withdrawal value of the amount transferred to less than
the amount of the transfer.
/s/ Robert H. Benmosche
/s/ Louis J.Ragusa
E 31910-3
<PAGE>
Exhibit 4(y)
Met Logo
METROPOLITAN LIFE INSURANCE COMPANY
(A Mutual Company Incorporated in New York State)
One Madison Avenue, New York, NY 10010-3690
ENDORSEMENT
The certificate to which this endorsement is attached is amended as follows:
We may allow money held under one or more other MetLife certificates to be
transferred to this certificate without imposing the withdrawal charge under the
other certificates. If we do so, the following provisions will apply to the
amount transferred:
1. If the "Right to Examine" provision of this certificate is exercised, the
transfer will be reversed and we will reinstate the other certificates (or
pay you their cash withdrawal values, if you ask, after imposing any
applicable withdrawal charges).
2. The interest rates we credit on any portion of the transferred amount
allocated to the Fixed Interest Account may be different from the interest
rate we credit on other deposits.
3. [The withdrawal charge schedule under this certificate that will apply to
the amount transferred will be the better of:
a) The same schedule that would have applied to that account balance
had it remained in your other MetLife certificates.
and
b) The following schedule:
During Deposit Year
1 2 3 4 5 6 & Beyond
5% 4% 3% 2% 1% 0
Deposit years are based on the date of transfer to this certificate,
not the date of original deposit under the other certificates.]
4. Despite any provision in this certificate to the contrary, withdrawal
charges may reduce the cash withdrawal value of the amount transferred to
less than the amount of the transfer.
/s/ Robert H. Benmosche
/s/ Louis J. Ragusa
G 7812-38-1
<PAGE>
Exhibit 4(z)
Met Logo
METROPOLITAN LIFE INSURANCE COMPANY
(A Mutual Company Incorporated in New York State)
ENDORSEMENT
This Endorsement amends the Individual Retirement Annuity ("IRA") contract to
which it is attached, effective on the contract issue date, to make it suitable
for use as a funding vehicle under a Savings Incentive Match Plan for Employees
of Small Employers ("SIMPLE IRA"), established by an employer under Section
408(p) of the Internal Revenue Code of 1986 (the "Code"). In the event of a
conflict between this Endorsement and the Contract, the provisions of the
Endorsement will control.
The following paragraphs are added to the definitions section of the Contract:
"SIMPLE IRA" is an IRA contract issued under a Savings Incentive Match Plan for
Employees of Small Employers established by an employer under Section 408(p) of
the Internal Revenue Code of 1986.
"Participant" is an employee under a SIMPLE IRA plan who is the annuitant and
sole owner of the contract and the person for whose benefit the contract is
issued.
The following paragraphs replace the section of the Contract dealing with
purchase payments:
1. This SIMPLE IRA Contract will only accept purchase payments made in cash on
behalf of a Participant under a qualified salary reduction arrangement
under Section 408(p)(2) and other employer contributions within the
limitations of and pursuant to the terms of a Simple IRA Plan described in
Section 408(p) of the Code. It will also accept contributions and purchase
payments as a result of a transfer or rollover from other SIMPLE IRAs of
the Participant. No other contributions or purchase payments may be made
under this contract.
2. A Participant may make contributions expressed as a percentage of his or
her compensation (up to 100%), but may not contribute in excess of $6,000
(indexed for inflation after 1997) in the aggregate each year to this and
all other certificates, contracts or accounts that are used as funding
vehicles under the employer's SIMPLE IRA plan.
3. Any refund of purchase payments (other than those attributable to excess
contributions) will be applied, before the close of the calendar year
following the year
R.S. 1209
<PAGE>
of the refund, toward the payment of future purchase payments or the
purchase of additional benefits.
The following paragraph is added to the section of the Contract dealing with
withdrawals:
Prior to the expiration of the two year period beginning on the date the
Participant first participated in any SIMPLE IRA Plan maintained by the
employer, any rollover or transfer from this SIMPLE IRA must be made to another
SIMPLE IRA of the Participant in order to qualify as a rollover under Section
408(p) of the Code. Any distribution of funds from this SIMPLE IRA during this
two year period may be subject to a 25% additional tax if not rolled over into a
SIMPLE IRA. After the expiration of this two year period, the Participant may
rollover or transfer funds to any IRA of the Participant that is qualified under
Section 408(a) or 408(b) of the Code, and the 25% distribution tax penalty no
longer applies.
The following paragraphs replace the paragraphs in the income payments section
dealing with minimum distribution, and any other paragraphs or sections
inconsistent with the following:
1. Your entire interest in the contract must be distributed or commence to be
distributed, no later than the first day of April following the calendar
year in which you attain age 70 1/2 (Required Beginning Date).
Payments must be made over:
a) your life, or the lives of you and your designated beneficiary, or
b) a period certain not extending beyond your life expectancy or the
life expectancy of you and your designated beneficiary.
Payments must be made in periodic payments at intervals of no longer than
one year. In addition, payments may not increase except as provided in Q&A
F-3 Section 1.401(a)(9)-1 of the Proposed Income Tax Regulations.
2. All minimum distributions shall be made in accordance with the requirements
of Section 401(a)(9) of the Code, including the incidental death benefit
requirements of Section 401(a)(9)(G) of the Code, and the regulations
thereunder, including the minimum distribution incidental benefit
requirement of Section 1.401(a)(9)-2 of the Proposed Income Tax
Regulations.
3. Life expectancy is computed by use of the expected return multiples in
Table V and VI of Section 1.72-9 of the Income Tax Regulations. Unless you
otherwise elect by the time distributions are required to begin, life
expectancies shall not be recalculated annually. Such election by you shall
be irrevocable and shall apply to all subsequent years. The life expectancy
of a non-spousal beneficiary ( or your life expectancy or the life
expectancy of a spousal beneficiary where you do not elect to recalculate
life expectancy) may not be recalculated. Instead, life expectancy will be
calculated using
2
<PAGE>
the attained age of such beneficiary (or your attained age or spousal
beneficiary's age where you do not elect to recalculate life expectancy)
during the calendar year in which you attain age 70 1/2, and payments for
subsequent years shall be calculated based on such life expectancy reduced
by one for each calendar year which has elapsed since the calendar year
life expectancy was first calculated.
4. Distributions under this section are considered to have begun if
distributions are made after you have reached your Required Beginning Date
or if prior to the Required Beginning Date distributions irrevocably
commence to an individual over a period permitted and in an annuity form
acceptable under section 1.401(a)(9) of the Regulations.
5. Minimum distribution requirements may be satisfied by receiving a
distribution from one SIMPLE IRA that is equal to the amount required to
satisfy the minimum distribution requirements for two or more SIMPLE IRAs.
For this purpose, the owner of two or more SIMPLE IRAs may use an
alternative method to satisfy the minimum distribution requirements. If you
do not elect in a manner acceptable to us, to receive the required minimum
distribution under one of the allowable methods, we will assume that you
are receiving the aggregate amount required from another SIMPLE IRA.
The following paragraphs are added to the section of the Contract dealing with
your death before income payments begin:
1. If you die before distribution of your Account Balance begins, distribution
of your entire Account Balance shall be completed by December 31 of the
calendar year containing the fifth anniversary of your death except to the
extent that an election is made to receive distributions in accordance with
(a) or (b) below:
a) If your Account Balance is payable to a designated beneficiary, then
the entire amount may be distributed over the life or over a period
certain not greater than the life expectancy of the designated
beneficiary commencing on or before December 31 of the calendar year
immediately following the calendar year of your death.
b) If the designated beneficiary is your surviving spouse, the date
distributions are required to begin in accordance with (1) above shall
not be earlier than the later of (i) December 31 of the calendar year
immediately following the calendar year of your death or (ii) December
31 of the calendar year in which you would have attained age 70 1/2.
2. Life expectancy is computed by use of the expected return multiples in
Tables V and VI of Section 1.72-9 of the Income Tax Regulations. For
purposes of distributions beginning after your death, unless otherwise
elected by the surviving spouse by the time distributions are required to
begin, life expectancies shall not be recalculated annually. Such election
shall be irrevocable by the surviving spouse and shall apply to
3
<PAGE>
all subsequent years. In the case of any other designated beneficiary (or
in the case of a spousal beneficiary who does not elect to recalculate life
expectancy), life expectancies shall be calculated using the attained age
of such beneficiary during the calendar year in which distributions are
required to begin pursuant to this section, and payments for any subsequent
calendar year shall be calculated based on such life expectancy reduced by
one for each calendar year which has elapsed since the calendar year life
expectancy was first calculated.
The following paragraph is added to the death benefit section of the Contract:
If you die after distribution of your Account Balance has begun under Minimum
Distribution, the remaining portion of your Account Balance will continue to be
distributed at least as rapidly as under the method of distribution being used
prior to your death.
The following paragraphs are added to the section of the Contract dealing with
Federal Income Tax rules:
If contributions made on behalf of the Participant pursuant to a SIMPLE IRA Plan
maintained by the Participant's employer are received directly by MetLife from
the employer, we will provide the employer with the summary description required
by Section 408(l) of the Code. We will also furnish annual calendar year reports
as required by the Code.
In order to continue to qualify this Contract under Section 408(b) of the Code,
the Company can amend this Endorsement to reflect changes in the provisions of
the Code and related regulations by sending you an amendment.
/s/ Louis J. Ragusa
/s/ Harry P. Kamen
<PAGE>
Exhibit 4(z)
MET LOGO
ENDORSEMENT
This Endorsement amends Certificate Form No. G.4333-15 so that it can be used
as a funding vehicle under a Savings Incentive Match Plan for Employees of
Small Employers ("Simple IRA"), established by an employer under section
408(p) of the Internal Revenue Code of 1986 (the "Code").
The following paragraphs are added to Item 2 on page 2 of the Certificate:
A participant in a SIMPLE IRA can make contributions to this Certificate under
a qualified salary reduction arrangement with the employer maintaining the
SIMPLE IRA, subject to the limitations under section 408(p)(2) of the Code.
A participant may contribute a percentage of his or her compensation (up to
100 percent of compensation), but may not contribute in excess of $6,000
(indexed for inflation beginning in 1998) in the aggregate per year to this,
and all other certificates, contracts or accounts that are used as funding
vehicles under the employer's SIMPLE IRA.
This Certificate may also accept employer contributions made on your behalf
within the limitations of section 408(p) of the Code.
This Certificate will also accept direct transfers and rollovers, which are
not prohibited under section 408(p) and which are otherwise permitted under
the terms of this Certificate.
The following paragraph is added to Item 8(a) on page 9 of the Certificate:
Withdrawals before age 59 1/2 during the first two years of participation in
the SIMPLE IRA may be subject to a 25% tax penalty instead of a 10% tax
penalty, which would be in addition to ordinary Federal income tax.
- -S- -S-
Louis J. Ragusa Harry P. Kamen
Vice-President & Secretary Chairman, President & Chief
Executive Officer
RSC 96-37
<PAGE>
Exhibit 5(i)
MetLife/R/ Retirement & Savings Center
Metropolitan Life Insurance Company
One Madison Avenue, New York, NY 10010-3690
Contract/Certificate Number ______________
(To be completed by MetLife)
Variable Annuity
Application
(Preference Plus/R/ Account)
TSA/IRC Section 457(b)
Deferred Compensation/IRC Section 403(a)
Contract/Certificate Applied for:
/ / Tax Sheltered Annuity Check if: / / 501(c)(3)
(IRC Section 403(b)) (TSA)
/ / IRC Section 403(a) Check if: / / O.R.P. ________(State)
/ / IRC Section 457(b) Deferred Compensation
1 Participant
<TABLE>
<S> <C>
- ----------------------------------------------------------------------------- --------------------- --------------------
First Name Middle Initial Last Name / / Mr. / / Mrs. / / Ms. Marital Status Date of Birth
- ----------------------------------------------------------------------------- -------------------------------------------
Street Occupation
- -----------------------------------------------------------------------------
City State Zip U.S. Citizen? / / Yes / / No
- ----------------------------------------------------------------------------- -------------------------------------------
Social Security Number Sex:/ / M / / F Are you retired? / / Yes / / No If No, specify country of citizenship.
/ / A.M.
/ / / P.M.
- -------------------------- ------------------------------------------------ -------------------------------------------
Home Telephone Number Work Telephone Number Most convenient PLACE/TIME to call
</TABLE>
2 Revocable Beneficiary (TSA and 403(a) Only)
If you are married, for all 403(a) plans and TSA plans subject to ERISA, upon
your death prior to commencing benefits under your employer's Plan, your death
benefit must be paid in the form of a qualified pre-retirement survivor
annuity which generally entitles your spouse to receive a survivor annuity
equal to at least 50% of your account balance, unless your spouse has waived
this right and furnishes a completed Spousal Consent form.
<TABLE>
<S> <C>
- ----------------------------------------------------------------------------- -------------------------------------------
First Name Middle Initial Last Name / / Mr. / / Mrs. / / Ms. Relationship to Participant
- ----------------------------------------------------------------------------- -------------------------------------------
Street Address (if mailing address different from Participant) Date of Birth
- ----------------------------------------------------------------------------- -------------------------------------------
City State Zip Social Security Number
</TABLE>
3 Contingent Beneficiary (TSA and 403(a) Only)
<TABLE>
<S> <C>
- ----------------------------------------------------------------------------- -------------------------------------------
First Name Middle Initial Last Name / / Mr. / / Mrs. / / Ms. Relationship to Participant
- ----------------------------------------------------------------------------- -------------------------------------------
Street Address (if mailing address different from Participant) Date of Birth
- ----------------------------------------------------------------------------- -------------------------------------------
City State Zip Social Security Number
</TABLE>
Page 1 of 4
038-PPA-TSA/PEDC(0998)
<PAGE>
4 Contribution
(a) Employee Anticipated Schedule $ _______ per contribution _____ times a
Contract/Certificate year. Total $__________
Additional (balloon) Amount $ _______ per contribution _____ times a
Contract/Certificate year. Total $__________
I certify that I have entered into a separate salary reduction agreement
with my employer for employee salary reduction contributions.
Employer Anticipated Schedule $ _______ per contribution _____ times a
Contract/Certificate year. Total $__________
*(b) Lump Sum/Tax Free Direct Transfer Amount $__________
Check One: / / Direct Transfer (Rev. Rul. 90-24)
/ / 403(b) Direct Rollover
/ / 403(a) Direct Rollover
(c) Anticipated date first contribution will be received _________________
* The appropriate transfer forms must be completed.
5 Replacement (Attach the appropriate transfer/replacement forms)
Have you taken, or will you be taking, any money from a life insurance policy or
tax sheltered annuity contract/certificate to put into the annuity you are
applying for? This includes the following:
Full or partial withdrawals of dividends or cash values, loans,
pledging as collateral, reissuing with less cash value, suspension or
reduction of premium or purchase payment, automatic premium loan or
invoking an accelerated payment arrangement.
/ /Yes / /No If Yes, you must provide details below
(regardless of whether state replacement rules apply)
<TABLE>
<CAPTION>
Check /x/ if
Company Name Policy/Contract # Describe the Transaction Rev. Rul. 90-24 Check /x/ if Group
(e.g. full withdrawal of cash value) Transfer Life or Annuity
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
6 Employer/Plan Name
NOTE: For Section 457(b), the employer is the purchaser and the Owner.
For Section 403(b) and 403(a), the participant is the Owner.
Check One: / / Existing Group: / / New Group: if new group,
Employer Group No.__________________ complete form
#18000084012 and the
following
(a) Employer
--------------------------------------------------------------------
(b) Plan Name (if different)
----------------------------------------------------
(c) Address
--------------------------------------------------------------------
(d) Employee I.D. No.
(if other than Soc. Sec. No.) Campus No.
---------------------- -----------
(e) Participant's Date of
Employment (ERISA only) Plan Participation Date
------------ --------------
Page 2 of 4
<PAGE>
7 Investment Objective and Allocation
(a) Primary Investment Objective: (Check only one)
/ / Preservation of Capital / / Income / / Growth & Income
/ / Growth / / Aggressive Growth
(b) Secondary Investment Objective: (Optional)
/ / Preservation of Capital / / Income / / Growth & Income
/ / Growth / / Aggressive Growth
(c) Was the Asset Allocation Questionnaire use for this sale?
/ / Yes (If Yes, please submit a copy with the application.)
/ / No
(d) Indicate the percentage of your initial contribution to be allocated to
each funding option. Percentages must be in whole numbers and total
100%. This allocation will apply to future contributions unless changed
by the Owner. You may change your allocation at any time. If you choose
Index Select(SM), do not complete this item 7(d).
Fixed Interest Account ___________ %
State Street Research
Aggressive Growth Division ___________ %
Diversified Division ___________ %
Growth Division ___________ %
Income Division ___________ %
Calvert
Social Balanced Division ___________ %
Harris Oakmark
Large Cap Value Division ___________ %
Janus
Mid Cap Division ___________ %
Loomis Sayles
High Yield Bond Division ___________ %
Neuberger&Berman
Partners Mid Cap Value Division ___________ %
Santander
International Stock Division ___________ %
Scudder
Global Equity Division ___________ %
T. Rowe Price
Large Cap Growth Division ___________ %
Small Cap Growth Division ___________ %
Lehman Brothers Aggregate
Bond Index Division ___________ %
MetLife Stock Index Division ___________ %
Morgan Stanley EAFE Index Division ___________ %
Russell 2000 Index Division ___________ %
Total must equal 100%
(e) Optional Automated Investment Strategies:
Select only ONE strategy. You must complete item 7(d) for all strategies except
Index Selector.
/ / Equity Generator(SM) / / Equalizer(SM)
/ / Rebalancer(SM) / / Aggressive Equity Generator(SM)
/ / Aggressive Equalizer(SM) / / Allocator(SM) (attach form)
/ / Index Selector Allocation Models (see instructions below)
Index Selector: Check only ONE of the categories below. Do not complete
item 7 (d) above. 100% of your contribution will be allocated to the Index
Selector category you choose in accordance with your risk tolerance.
See your Representative for information on the current allocations in
each category and for help in determining your risk tolerance.
<TABLE>
<S> <C> <C> <C> <C>
/ / Conservative / / Conservative to / / Moderate / / Moderate to / / Aggressive
Moderate Aggressive
</TABLE>
I understand that MetLife will allocate my initial contribution and future
contributions based on the current allocation for the Index Selector category
I select for as long as I remain in this category. I accept this current
allocation and understand it may change at any time (after MetLife notifies me
about the change). MetLife will rebalance the amount in the Index Divisions
and the Fixed Interest Account each calendar quarter to match the applicable
allocation percentages for that category.
8 Financial Disclosure
NOTE: This section is not required for employer sponsored plans subject
to the requirements of ERISA.
(a) Purpose of purchasing this annuity: / / Retirement
/ / Other (please specify) ____________________________________________
(b) Total annual income $ _______________ Source of Income _________________
(c) Is the source of funds for purchasing this annuity an IRC
Section 403(b)(7) Mutual Fund? / / Yes / / No
(d) Ages of Dependents ______________________________________________________
(e) Please indicate your Total Vested Retirement Funds (excluding your
initial contribution).
/ / $0-9,999 / / $10,000-19,999 / / $20,000-39,999
/ / $40,000-69,999 / / $70,000-99,999 / / $100,000-249,999
/ / $250,000+
Page 3 of 4
<PAGE>
9 Signatures
I hereby represent my answers to the above questions to be correct and true to
the best of my knowledge and belief. I have received current prospectuses for
the Preference Plus Account and the Calvert Social Balanced Portfolio. I
understand that as required by law the Preference Plus Account restricts
distribution of my 403(b) contributions and earnings on them to the extent
required by law until I am 59 1/2 except under certain special situations.
This does not restrict tax free transfers to other funding vehicles. I also
understand that my 403(a) and 403(b) contributions and earnings may be
restricted as defined in the plan document. 457(b) ONLY: I understand that as
required by law the 457(b) program prohibits distribution of contributions and
earnings until the calendar year I, as the participant attain age 70 1/2, or
under other special circumstances. I understand that all values provided by
the contract/certificate being applied for which are based on the investment
experience of the Separate Account are variable and are not guaranteed as to
the amount.
- ---------------------------------- Signed at: ----------------------------------
Participant City State
- -------------------------------------------------------
Plan Administrator Signature for ERISA Plans Only
/ /
- ------------------------------------------------------- ---------------------
Owner Signature for Section 457(b) Plans Only Month Day Year
- --------------------------------------------------------------------------------
Account Representative Information
I personally saw the Proposed Participant when the application was written and
each question was asked and answered as recorded. All answers are correct to the
best of my knowledge. I have delivered current Preference Plus Account and
Calvert Social Balanced Portfolio prospectuses and reviewed the financial
situation of the Proposed Participant as disclosed, and believe that a
multifunded annuity contract would be suitable. Suitability requirements are not
applicable to 403(b) ERISA plans.
o Are you licensed in the state of signing? / / Yes / / No
o Has the applicant taken, or will they be taking, any money from a life
insurance policy or annuity contract to put into the annuity the applicant is
applying for (as described in section 5)?
/ / Yes If Yes, please attach a copy of replacement forms.
/ / No
o Was an Asset Allocation Questionnaire used in connection with item 7?
/ / Yes If Yes, please attach a copy to the application.
/ / No
Contract/Certificate Mailing (403(a)/403(b))
/ / Direct to client / / Rep. delivery
- ----------------------------------------------------- -------------------------
Producer Identity (District, Agency/Agency Index) Agency Telephone Number
Signature
----------------------------------------------------------------------
License ID #
/ /
- ----------------------------------------------- -------------------------
Print Full Name Date Month Day Year
Page 4 of 4
<PAGE>
Exhibit 5(i)(i)
MetLife/R/ Retirement & Savings Center
Metropolitan Life Insurance Company
One Madison Avenue, New York, NY 10010-3690
Contract Number ___________________________
(To be completed by MetLife)
Variable Annuity
Application
(Preference Plus(R) Account)
/ / Non-Qualified / / IRA Section 408(b) / / Roth IRA Section 408A
/ / SEP Section 408(k)
1 Annuitant (Annuitant will be Owner unless item 2 is completed)
- ----------------------------------------------------- -------------------------
First Name Middle Initial Last Name Date of Birth
- ----------------------------------------------------- -------------------------
Street Address Social Security Number
- -----------------------------------------------------
City State Zip Code Sex: / / M / / F
- --------------------- --------------------- ---------- ---------------------
Home Telephone Number Work Telephone Number Occupation Relationship to Owner
2 Owner (Non-Qualified Only) Complete if Owner is different from Annuitant -
See Note 1 at end of application.
- ----------------------------------------------------- -------------------------
First Name Middle Initial Last Name Date of Birth
- ----------------------------------------------------- -------------------------
Street Address Social Security Number
or Tax ID Number
- -----------------------------------------------------
City State Zip Code Sex:/ / M / / F
- --------------------- --------------------- -----------
Home Telephone Number Work Telephone Number Occupation
Are you retired? / / Yes / / No
3 Joint Owner (Non-Qualified Only)
- ----------------------------------------------------- -------------------------
First Name Middle Initial Last Name Date of Birth
- ----------------------------------------------------- -------------------------
Street Address Social Security Number
- -----------------------------------------------------
City State Zip Code Sex:/ / M / / F
-------------------------
Relationship to Owner
- --------------------- --------------------- -----------
Home Telephone Number Work Telephone Number Occupation
Are you retired? / / Yes / / No
(If two people are named as Joint Owners, either Owner may exercise any and all
rights under the contract unless the Owner designation specifies otherwise.)
4 Beneficiary
Primary
- --------------------------- ------------------------- ----------------------
Name Relationship to Owner Social Security Number
- --------------------------- ------------------------- ----------------------
Name Relationship to Owner Social Security Number
- --------------------------- ------------------------- ----------------------
Name Relationship to Owner Social Security Number
Contingent
- --------------------------- ------------------------- ----------------------
Name Relationship to Owner Social Security Number
- --------------------------- ------------------------- ----------------------
Name Relationship to Owner Social Security Number
(For payment due on Owner's death, the Owner's estate will be paid if no
Beneficiary is named. Not applicable to Annuitant's death if Owner and Annuitant
are different.)
Page 1 of 4
038-PPA-IRA/SEP/NQ(0998)
<PAGE>
5 Purchase Payment Information
a) Total of checks submitted now with the application $ ____________
Total estimated future transfers (include transfer forms) $ ____________
Total Initial Purchase Payment $ ____________
b) Schedule of automated purchase payments: $ _________ per purchase payment
_________ times per year
c) I irrevocably designate my IRA, Roth IRA or SEP contribution as follows:
1. (Complete for IRA, Roth IRA or SEP)
Tax Year 19___ $ ______________(current tax year)
Tax Year 19___ $ ______________ (prior tax year)
2. (Complete for IRA or SEP)
$_____________ Direct Transfer from traditional IRA to MetLife
traditional IRA
$_____________ Rollover (within 60 days) from traditional IRA to MetLife
traditional IRA
$_____________ Direct Rollover from tax qualified plan to a MetLife
traditional IRA
3. (Complete for Roth IRA)
$_____________ Conversion/Rollover from traditional IRA to MetLife Roth
IRA
$_____________ Direct Transfer from a Roth IRA to MetLife Roth IRA
$_____________ Rollover (within 60 days) from Roth IRA to MetLife Roth
IRA
Enter the applicable contribution date(s) for the Roth IRA from which
this transfer is being made:
/ / ___ /___ /___ Date of the earliest conversion/rollover (from a
traditional IRA), if any, that you made to the Roth IRA
from which this transfer is being made.
/ / ___ /___ /___ Date of the first regular (non-conversion)
contribution, if any, that you made to the Roth IRA
from which this transfer is being made.
d) For IRA/NQ If salary deductions are to be made by automated payroll
deduction, please indicate:
Employer's Name_______________________ Employer's Group No. ___________
e) SEP Only (For new groups, please attach SEP Agreement and Funding
Authorization Form #T22698)
1. Existing Group No._______________ 2. Employer ID No. (if other than
Social Security No.) ___________________
3. New Group: Name of Plan or Arrangement ______________________________
6 Check-O-Matic (not available for SEP)
I authorize MetLife to draw checks or share drafts, to issue directions to debit
a checking account, or to initiate electronic fund transfer debits each month to
pay purchase payments on this annuity. This arrangement will begin on or about
the annuity's effective date and will end when I revoke it by written notice to
MetLife, or when MetLife revokes it by written notice to me. The purchase
payments will be $ _________a month and will be paid on or about the _________
of each month. Attached is a voided blank check, draft or bank specifications
sheet.
I authorize the bank named below to pay and charge to my account: checks,
share drafts, electronic fund transfer debits or other account debits made by
MetLife under this agreement. I agree that the bank's treatment of any such
check, share draft, electronic fund transfer debit and the bank's right with
respect to it will be the same as if I personally signed or initiated it, and
that if it is dishonored for any reason, the bank will not be under any
liability. I agree that the bank may treat this arrangement as valid and
effective until it receives written notice of its revocation or until the bank
ends it earlier.
________________________________________________ ____________________________
Signature of Depositor Name of Bank
________________________________________________ ____________________________
Name of Depositor (as it appears in bank records) Branch (where account is kept)
________________________________________________ ____________________________
Name of Joint Depositor Transit Number
7 Replacement (attach the appropriate forms)
Have you taken, or will you be taking, any money from a life insurance policy
or annuity contract to put into the annuity you are applying for? This
includes the following:
Full or partial withdrawals of dividends or cash values, loans, pledging
as collateral, reissuing with less cash value, suspension or reduction of
premium or purchase payment, automatic premium loan or invoking an
accelerated payment arrangement.
/ / Yes / / No If Yes, you must provide details below
(regardless of whether state replacement rules apply)
<TABLE>
<CAPTION>
Check /x/ if IRC
Company Name Policy/Contract # Describe the Transaction Section 1035 Check /x/ if Group
(e.g. full withdrawal of cash value) Exchange Life or Annuity
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
</TABLE>
Page 2 of 4
<PAGE>
8 Investment Objective and Allocation
(a) Primary Investment Objective: (Check only one)
/ / Preservation of Capital / / Income / / Growth & Income / / Growth
/ / Aggressive Growth
(b) Secondary Investment Objective: (Optional)
/ / Preservation of Capital / / Income / / Growth & Income / / Growth
/ / Aggressive Growth
(c) Was the Asset Allocation Questionnaire used for this sale?
/ / Yes (If Yes, please submit a copy with the application.)
/ / No
(d) Indicate the percentage of your initial payment to be allocated to each
funding option. Percentages must be in whole numbers and total 100%. This
allocation will apply to future payments unless changed by the Owner. You
may change your allocation at any time. If you choose Index Selector(SM),
do not complete this item 8(d).
Fixed Interest Account ___________ %
State Street Research
Aggressive Growth Division ___________ %
Diversified Division ___________ %
Growth Division ___________ %
Income Division ___________ %
Harris Oakmark
Large Cap Value Division ___________ %
Janus
Mid Cap Division ___________ %
Loomis Sayles
High Yield Bond Division ___________ %
Neuberger&Berman
Partners Mid Cap Value Division ___________ %
Santander
International Stock Division ___________ %
Scudder
Global Equity Division ___________ %
T. Rowe Price
Large Cap Growth Division ___________ %
Small Cap Growth Division ___________ %
Lehman Brothers Aggregate
Bond Index Division ___________ %
MetLife Stock Index Division ___________ %
Morgan Stanley EAFE Index Division ___________ %
Russell 2000 Index Division ___________ %
Total must equal 100%
(e) Optional Automated Investment Strategies:
Select only ONE strategy. You must complete item 8(d) for all strategies
except Index Selector.
/ / Equity Generator(SM) / / Equalizer(SM)
/ / Rebalancer(SM) / / Aggressive Equity Generator(SM)
/ / Aggressive Equalizer(SM) / / Allocator(SM) (attach form)
/ / Index Selector Allocation Models (see instructions below)
Index Selector: Check only ONE of the categories below. Do not complete item 8
(d) above. 100% of your contribution will be allocated to the Index Selector
category you choose in accordance with your risk tolerance. See your
Representative for information on the current allocations in each category and
for help in determining your risk tolerance.
/ / Conservative / / Conservative to / / Moderate / / Moderate to
Moderate Aggressive
/ / Aggressive
I understand that MetLife will allocate my initial payment and future
contributions based on the current allocation for the Index Selector category I
select for as long as I remain in this category. I accept this current
allocation and understand it may change at any time (after MetLife notifies me
about the change). MetLife will rebalance the amount in the Index Divisions and
the Fixed Interest Account each calendar quarter to match the applicable
allocation percentages for that category.
9 Financial Disclosure
(a) Purpose of purchasing this annuity: / / Retirement
/ / Other (please specify) ___________________________
(b) Total Annual Income $ ___________________________________________________
Source of Income_________________________________________________________
Note: You cannot contribute to a Roth IRA or convert/rollover a traditional
IRA to a Roth IRA if your income exceeds certain limits set forth
under IRC Sections 408 & 408A. (Consult your tax advisor.)
(c) Source of funds for purchasing this annuity:
/ / CD (Certificate of Deposit) / / Discretionary Income
/ / Savings Account / / Pension Rollover/Transfer / / Loan
/ / Money Market Fund / / Other Mutual Fund / / Other ________________
(d) Is the source of funds a MetLife or MetLife Securities Inc.
contract/account? / / Yes / / No
(e) Ages of Dependents
(f) For IRA, Roth IRA and SEP, please indicate your vested retirement funds
(excluding your initial contribution).
/ / $0-9,999 / / $10,000-19,999 / / $20,000-39,999
/ / $40,000-69,999 / / $70,000-99,999 / / $100,000-249,999
/ / $250,000+
(g) For Non-Qualified, please indicate your assets (Net savings and
investments exclusive of personal residence, home furnishings and
personal automobiles).
/ / $0-9,999 / / $10,000-19,999 / / $20,000-39,999
/ / $40,000-69,999 / / $70,000-99,999 / / $100,000-249,999
/ / $250,000+
Page 3 of 4
<PAGE>
10 Signatures
(If the Owner is a corporation, partnership or trust, print the name of the
Owner and have one or more officers, partners or trustees sign. Note:
Earnings in this contract may be taxable annually to the Owner. Consult your
tax advisor.)
I hereby represent that, to the best of my knowledge and belief, I am
eligible, under federal tax law, to contribute said amount to this annuity
and that the information I have provided above to be correct and true. I
understand that all values provided by the contract being applied for, which
are based on the investment experience of the Separate Account, are variable
and are not guaranteed as to the amount.
__________________________________ Signed at _________________________
Signature of Annuitant City State
__________________________________ Date: ________/_________/________
Signature of Owner Mo. Day Yr.
(if other than Annuitant)
__________________________________ Date: ________/_________/________
Signature of Joint Owner Mo. Day Yr.
- --------------------------------------------------------------------------------
Account Representative Information
I personally saw the Proposed Owner when the application was written and each
question was asked and answered as recorded. All answers are correct to the best
of my knowledge. I have delivered a current Preference Plus Account prospectus
and reviewed the financial situation of the Proposed Owner as disclosed, and
believe that a multifunded annuity contract would be suitable.
/ / Are you licensed in the state of signing? / / Yes / / No
o Has the applicant taken, or will they be taking, any money from a life
insurance policy or annuity contract to put into the annuity the applicant
is applying for (as described in section 7)?
/ / Yes If Yes, please attach a copy of replacement forms.
/ / No
o Was an Asset Allocation Questionnaire used in connection with section 8?
/ / Yes If Yes, please attach a copy to this application.
/ / No
_________________________________________________ __________________________
Producer Identity (District, Agency/Agency Index) Agency Telephone Number
Signature _______________________________________ __________________________
License ID #
__________________________________________ Date: _________/________/________
Print Full Name Mo. Day Yr.
Note 1 (Non-Qualified Only): If the Owner is a grantor trust, please furnish the
social security number of the grantor or the person who is considered the Owner
of the Trust for federal income tax purposes in item #2. If the Owner is a
Trust, other than a grantor trust, we require the Trust's TIN in item #2. The
earnings in the contract will be taxable to the Owner each year unless the Trust
holds the contract for federal tax purposes as an Agent for an individual. If
the Trust is an Agent for a natural person, please furnish us with a statement
signed by the Trustee that all the beneficial interest in the Trust (both income
and remainder) must be held for the benefit of an individual.
Page 4 of 4
<PAGE>
Exhibit 5.(i)(ii)
MetLife/R/ Retirement & Savings Center
Metropolitan Life Insurance Company
One Madison Avenue, New York, NY 10010-3690
Contract Number __________________________
(To be completed by MetLife)
The Preference Plus/R/
Income Annuity
Application
Application For: An Immediate Income Variable Annuity
(Check One) / / Non-Qualified / / IRA Section 408(b) / / SEP Section 408(k)
/ / Other
1 Primary Annuitant (Annuitant will be Owner unless item 3 is completed.)
/ /
- ------------------------------------------- ------------------------------
First Name Middle Initial Last Name Date of Birth
- ------------------------------------------- ------------------------------
Street Address Daytime Number
- ------------------------------------------- ------------------------------
City State Zip Code Evening Number
- ---------------------- ------------------------------
Social Security Number Sex: / / M / / F Relationship to Owner
2 Joint Annuitant (If applicable.)
/ /
- ------------------------------------------- ------------------------------
First Name Middle Initial Last Name Date of Birth
- ------------------------------------------- ------------------------------
Street Address Daytime Number
- ------------------------------------------- ------------------------------
City State Zip Code Evening Number
- ---------------------- ------------------------------
Social Security Number Sex: / / M / / F Relationship to Owner
3 Owner (Complete if Owner is different from Annuitant. Not applicable for IRA
or SEP accounts.)
/ /
- ------------------------------------------- ------------------------------
First Name Middle Initial Last Name Date of Birth
- ------------------------------------------- ------------------------------
Street Address Daytime Number
- ------------------------------------------- ------------------------------
City State Zip Code Evening Number
- ----------------------
Social Security Number Sex: / / M / / F
or TAX ID#
Page 1 of 4
RSCINCAPNQIRASEP(1098)
<PAGE>
4 Beneficiary (Complete only if an Income Annuity option with a cash refund
feature or with a Guaranteed Period is chosen or if the Owner is
different from the Annuitant.)
Primary
- ------------------ --------------------------------- ----------------------
Name Relationship to Primary Annuitant Social Security Number
- ------------------ --------------------------------- ----------------------
Name Relationship to Primary Annuitant Social Security Number
- ------------------ --------------------------------- ----------------------
Name Relationship to Primary Annuitant Social Security Number
Contingent
- ------------------ --------------------------------- ----------------------
Name Relationship to Primary Annuitant Social Security Number
- ------------------ --------------------------------- ----------------------
Name Relationship to Primary Annuitant Social Security Number
Note: Multiple beneficiaries may be named. Payment will be made in equal shares
to the survivors unless otherwise specified. If you are purchasing a
non-qualified annuity with an Owner that is not the Annuitant, the Owner will
receive any death benefits, if the Annuitant predeceases the Owner. Upon the
death of the Owner, the named beneficiaries will assume all rights under the
contract. If the primary beneficiaries predecease the Owner, the contingent
beneficiaries will assume all rights under the contract. If no beneficiary is
named, payments will be made to the Owner's estate.
5 Purchase Details
A. Purchase Amount $_______________________________
B. I irrevocably designate my IRA or SEP purchase as follows:
$__________ Direct transfer $__________ Rollover (within 60 days)
$_________ Direct rollover from a Tax Qualified Plan
Note: If you completed either the direct transfer or direct rollover section,
the appropriate forms must be completed.
C. Replacement (Attach the appropriate forms)
Have you taken, or will you be taking, any money from a life insurance policy or
annuity contract to put into the annuity you are applying for? This includes the
following:
Full or partial withdrawals of dividends or cash values, loans,
pledging as collateral, reissuing with less cash value, suspension or
reduction of premium or purchase payment, automatic premium loan or
invoking an accelerated payment arrangement.
/ /Yes / /No If Yes, you must provide details below
(regardless of whether state replacement rules apply)
<TABLE>
<CAPTION>
Check /x/ if IRC
Company Name Policy/Contract # Describe the Transaction Section 1035 Check /x/ if Group
(e.g. full withdrawal of cash value) Exchange Life or Annuity
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
6 Type Of Income Annuity Applied For (Complete either A, B, or C.)
A. Income for You Options: / / Your Lifetime
/ / Your Lifetime with a Cash Refund
/ / Your Lifetime with a Guaranteed Period of
_____years*
B. Income for Two Options: / / Income for Two Lives
/ / Income for Two Lives with a Cash Refund
/ / Income for Two Lives with a Guaranteed
Period of _______years*
With payments reducing by / / 00% (Do not Reduce)
/ / 25%
/ / 33 1/3%
/ / 50%
Upon the death of: / / Primary Annuitant / / Either Annuitant
Note: You must provide proof of your birth when selecting any of the Income for
You and Income for Two options. A certified birth certificate or copies of two
other proofs of birth such as a passport or baptismal certificate are preferred.
C. Non-life Option: / / Income for a Guaranteed Period of ________ years*
* Federal tax law may limit the number of years allowable on this option.
D. Payment Frequency: / / Monthly / / Quarterly / / Semi-Annually
/ / Annually
E. Payments to begin: ___________ , 19 ________(Payments cannot be deferred
more than 12 months.)
Page 2 of 4
<PAGE>
7 Investment Objective and Allocation
A. Primary Investment Objective (Check only one):
/ / Preservation of Capital / / Income / / Growth & Income
/ / Growth / / Aggressive Growth
B. Secondary Investment Objective (Optional):
/ / Preservation of Capital / / Income / / Growth & Income
/ / Growth / / Aggressive Growth
C. You may select as many funding options, including the Fixed Income
Option, as you wish (Note: In certain states, the number of funding
options you may select is restricted to 4). Indicate the percentage of
your purchase payment to be allocated to each option. Percentages must
be in whole numbers and total 100%. You may change your allocation at
any time. However, any money allocated to the Fixed Income Option,
either as an initial payment or as a transfer from another funding
option, may not be transferred to any other funding option.
Fixed Income Option ___________ %
State Street Research
Aggressive Growth Division ___________ %
Diversified Division ___________ %
Growth Division ___________ %
Income Division ___________ %
Harris Oakmark
Large Cap Value Division ___________ %
Janus
Mid Cap Division ___________ %
Loomis Sayles
High Yield Bond Division ___________ %
Neuberger&Berman
Partners Mid Cap Value Division ___________ %
Santander
International Stock Division ___________ %
Scudder
Global Equity Division ___________ %
T. Rowe Price
Large Cap Growth Division ___________ %
Small Cap Growth Division ___________ %
Lehman Brothers Aggregate
Bond Index Division ___________ %
MetLife Stock Index Division ___________ %
Morgan Stanley EAFE Index Division ___________ %
Russell 2000 Index Division ___________ %
Total must equal 100%
8 Financial Disclosure
A. Purpose of purchasing this annuity: / / Retirement
/ / Other (please specify) ___________________________
B Total annual income $ _______________ Source of Income _________________
C. Source of funds for purchasing this annuity:
/ / CD (Certificate of Deposit) / / Discretionary Income
/ / Savings Account / / Pension Rollover/Transfer / / Loan
/ / Money Market Fund / / Other Mutual Fund / / Other ______________
D. Is the source of funds a MetLife or MetLife Securities Inc.
contract/account? / / Yes / / No
E. Ages of Dependents ______________________________________________________
F. For IRA and SEP accounts, please indicate your vested retirement funds
(excluding your purchase amount); for Non-Qualified accounts, please
indicate your assets (net savings and investments exclusive of personal
residence, home furnishings and personal automobiles).
/ / $0-9,999.99 / / $10,000-19,999.99 / / $20,000-39,999.99
/ / $40,000-69,999.99 / / $70,000-99,999.99 / / $100,000-249,999.99
/ / $250,000+
9 Tax Withholding Election
The taxable portion of each payment is subject to federal tax withholding
under IRS wage withholding tables by treating you as married, claiming three
withholding allowances, unless you file an election to request withholding on
a different basis. Your election will remain in effect until you change or
revoke it by filing a new election with us. You may change your election at
any time and as often as you wish.
If you elect not to have withholding apply to your income payments, or if you
do not have enough federal income taxes withheld from your income payments,
you may be responsible for paying estimated tax directly to the Internal
Revenue Service. You may incur penalties under the estimated tax rules if
your withholding and estimated tax payments are not sufficient. If you have
not given us your correct taxpayer identification number, we are required to
withhold taxes by treating you as a single person with no withholding
allowances. This will remain in effect until we receive your correct tax
identification number. Certain states require us to withhold state income tax
when we withhold federal income tax. Additionally, certain states may impose
similar estimated tax rules and tax penalties. You should consult with your
tax advisor to determine if any of these state income tax withholding and
estimated tax rules apply to you.
Select one of the withholding options listed below:
/ / Do not withhold federal or state income taxes from my income payments.
(My election is void unless I have provided my correct tax identification
number.)
/ / I want federal income taxes and state income taxes, where required,
withheld from the taxable portion of each income payment based on the
following allowances and marital status selected below:
/ / Married / / Single / / Married but withhold at higher single rate
Number of withholding allowances claimed ________________________
Withhold the following additional amount of taxes from each income payment
$_________________________
Page 3 of 4
<PAGE>
10 Signatures (If the Owner is a corporation, partnership or trust, print the
name of the Owner and have one or more officers, partners or trustees sign.)
I hereby represent my answers to the above questions to be correct and true
to the best of my knowledge and belief. I understand that this product has no
cash value, cannot be surrendered and that the payment amounts will fluctuate
based on the performance of the underlying investments. I fully understand
that there is no death benefit under an Income for Your Lifetime or Income
for Two Lives option. I acknowledge that I have received a current Preference
Plus Account prospectus.
__________________________________ Signed at _________________________
Signature of Primary Annuitant City State
__________________________________ Date: _____/_________/___________
Signature of Joint Annuitant Mo. Day Yr.
__________________________________
Signature of Owner
- --------------------------------------------------------------------------------
Account Representative Information
I personally saw the Proposed Owner when the application was written, and each
question was asked and answered as recorded. All answers are correct to the best
of my knowledge. I have delivered a current Preference Plus Account prospectus
and reviewed the financial situation of the Proposed Owner as disclosed, and I
believe that a multi-funded annuity contract would be suitable.
o Are you licensed in the state of signing? / / Yes / / No
o Has the applicant taken, or will they be taking, any money from a life
insurance policy or annuity contract to put into the annuity the applicant is
applying for (as described in section 5)?
/ / Yes If Yes, please attach a copy of replacement forms.
/ / No
o Was an Asset Allocation Questionnaire used in connection with section 7?
/ / Yes If Yes, please attach a copy to this application.
/ / No
Signature: _______________________________ _______________________________
Full name (printed)
Date: _________/________/_______ Phone: _______________________
Mo. Day Yr.
__________________________________________ _______________________________
District, Agency/Office Name Producer/Agent ID#
__________________________________________ _______________________________
Agency Manager Signature Print Full Name
Page 4 of 4
<PAGE>
Exhibit 5(i)(iii)
MetLife/R/ Retirement & Savings Center
Metropolitan Life Insurance Company
One Madison Avenue, New York, NY 10010-3690
Contract Number __________________________
(To be completed by MetLife)
Variable Annuity
Application
Enhanced Preference Plus/R/ Account
For MetLife Employees
/ / Non-Qualified / / IRA/IRC Section 408(b)
1 Annuitant (Annuitant will be Owner unless item 3 is completed.)
/ /
- ------------------------------------------- ------------------------------
First Name Middle Initial Last Name Date of Birth
- ------------------------------------------- ------------------------------
Street Address Social Security Number
- -------------------------------------------
City State Zip Code Sex / / M / / F
- -------------- -------------- ---------- ------------------------------
Home Telephone Work Telephone Occupation Relationship to Owner
Number Number
2 Owner (Non-Qualified Only) Complete if Owner is different from Annuitant
/ /
- ------------------------------------------- ------------------------------
First Name Middle Initial Last Name Date of Birth
- ------------------------------------------- ------------------------------
Street Address Social Security Number
- -------------------------------------------
City State Zip Code Sex / / M / / F
- -------------- -------------- ----------
Home Telephone Work Telephone Occupation Are you Retired? / / Yes / / No
Number Number
3 Joint Owner (Non-Qualified Only)
/ /
- ------------------------------------------- ------------------------------
First Name Middle Initial Last Name Date of Birth
- ------------------------------------------- ------------------------------
Street Address Social Security Number
- -------------------------------------------
City State Zip Code Sex / / M / / F
- -------------- -------------- ----------
Home Telephone Work Telephone Occupation Are you Retired? / / Yes / / No
Number Number
(If two people are named as Joint Owners, either Owner may exercise any and all
rights under the contract unless the Owner designation specifies otherwise.)
4 Beneficiary
Primary
- ------------------ --------------------------------- ----------------------
Name Relationship to Owner Social Security Number
- ------------------ --------------------------------- ----------------------
Name Relationship to Owner Social Security Number
- ------------------ --------------------------------- ----------------------
Name Relationship to Owner Social Security Number
Contingent
- ------------------ --------------------------------- ----------------------
Name Relationship to Owner Social Security Number
- ------------------ --------------------------------- ----------------------
Name Relationship to Owner Social Security Number
(For payment due on Owner's death, the Owner's estate will be paid if no
Beneficiary is named. Not applicable to Annuitant's death if Owner and Annuitant
are different.)
Page 1 of 4
038-MEGPPA-IRA/NQ(10/98)
<PAGE>
5 Payment Information
(a) Total of checks submitted now with the application $______________
Initial payment (must be completed even if payroll
deduction is elected): $______________
(b) Schedule of payroll deduction payments, if applicable (For Non-Qualified
Only. Minimum: $25.00/month):
$ _____________ per paycheck (/ / Weekly / / Bi-Weekly
/ / Monthly)
(c) For IRA Only:
If this contract is intended to qualify as IRA/IRC Section 408(b),
$________ is irrevocably designated to represent the following (check
one)
/ / Direct Rollover from a tax-qualified retirement plan or TSA.
Please attach appropriate forms.
/ / Direct IRA to IRA rollover
/ / Other Rollovers (Within 60 days from retirement plan, IRA or TSA)
(d) Employee's I.D. Number _____________________________________
If applicable, I hereby irrevocably designate that, excluding any rollover
amount, the first $_______ contributed to this contract, by April 15, ______ is
intened for a ______ tax deduction. Year
Year
6 Replacement (Attach the appropriate forms)
Have you taken, or will you be taking, any money from a life insurance policy or
annuity contract to put into the annuity you are applying for? This includes the
following:
Full or partial withdrawals of dividends or cash values, loans,
pledging as collateral, reissuing with less cash value, suspension or
reduction of premium or purchase payment, automatic premium loan or
invoking an accelerated payment arrangement.
/ /Yes / /No If Yes, you must provide details below
(regardless of whether state replacement rules apply)
<TABLE>
<CAPTION>
Check /x/ if IRC
Company Name Policy/Contract # Describe the Transaction Section 1035 Check /x/ if Group
(e.g. full withdrawal of cash value) Exchange Life or Annuity
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
7 Investment Objective and Allocation
(a) Primary Investment Objective: (Check only one)
/ / Preservation of Capital / / Income / / Growth & Income
/ / Growth / / Aggressive Growth
(b) Secondary Investment Objective: (Optional)
/ / Preservation of Capital / / Income / / Growth & Income
/ / Growth / / Aggressive Growth
(c) Was the Asset Allocation Questionnaire used for this sale?
/ / Yes (If Yes, please submit a copy with the application.)
/ / No
Page 2 of 4
<PAGE>
(d) Indicate the percentage of your initial payment to be allocated to each
funding option. Percentages must be in whole numbers and total 100%.
This allocation will apply to future payments unless changed by the Owner.
You may change your allocation at any time. If you choose Index
Selector(SM), do not complete this item 7(d).
Fixed Interest Account ___________ %
State Street Research
Aggressive Growth Division ___________ %
Diversified Division ___________ %
Growth Division ___________ %
Income Division ___________ %
Harris Oakmark
Large Cap Value Division ___________ %
Janus
Mid Cap Division ___________ %
Loomis Sayles
High Yield Bond Division ___________ %
Neuberger&Berman
Partners Mid Cap Value Division ___________ %
Scudder
Global Equity Division ___________ %
Santander
International Stock Division ___________ %
T. Rowe Price
Large Cap Growth Division ___________ %
Small Cap Growth Division ___________ %
Lehman Brothers Aggregate
Bond Index Division ___________ %
MetLife Stock Index Division ___________ %
Morgan Stanley EAFE Index Division ___________ %
Russell 2000 Index Division ___________ %
Total must equal 100%
(e) Optional Automated Investment Strategies:
Select only ONE Strategy. You must complete item 7(d) for all strategies
except Index Selector.
/ / Equity Generator(SM) / / Equalizer(SM)
/ / Rebalancer(SM) / / Aggressive Equity Generator(SM)
/ / Aggressive Equalizer(SM) / / Allocator(SM) (attach form)
/ / Index Selector(SM) Allocation Models (see instructions below)
Index Selector: Check only ONE of the categories below. Do not complete item
7(d) above. 100% of your contribution will be allocated to the Index Selector
category you choose in accordance with your risk tolerance. See your
Representative for information on the current allocations in each category and
for help in determining your risk tolerance.
<TABLE>
<S> <C> <C> <C> <C>
/ / Conservative / / Conservative to / / Moderate / / Moderate to / / Aggressive
Moderate Aggressive
</TABLE>
I understand that MetLife will allocate my initial contribution and future
contributions based on the current allocation for the Index Selector category
I select for as long as I remain in this category. I accept this current
allocation and understand it may change at any time (after MetLife notifies me
about the change). MetLife will rebalance the amount in the Index Divisions
and the Fixed Interest Account each calendar quarter to match the applicable
allocation percentages for that category.
8 Financial Disclosure
(a) Purpose of purchasing this annuity: / / Retirement
/ / Other (please specify) ___________________________
(b) Total Annual Income $ _______________ Source of Income _________________
(c) Source of funds for purchasing this annuity:
/ / CD (Certificate of Deposit) / / Discretionary Income
/ / Savings Account / / Pension Rollover/Transfer / / Loan
/ / Money Market Fund / / Other Mutual Fund / / Other ______________
(d) Is the source of funds a MetLife or MetLife Securities Inc.
contract/account? / / Yes / / No
(e) Ages of Dependents ______________________________________________________
(f) For IRA, please indicate your vested retirement funds (excluding your
initial contribution)
/ / $0-9,999 / / $10,000-19,999 / / $20,000-39,999
/ / $40,000-69,999 / / $70,000-99,999 / / $100,000-249,999
/ / $250,000+
(g) For Non-Qualified, please indicate your assets (net savings and
investments exclusive of personal residence, home furnishings and
personaly automobiles).
/ / $0-9,999 / / $10,000-19,999 / / $20,000-39,999
/ / $40,000-69,999 / / $70,000-99,999 / / $100,000-249,999
/ / $250,000+
Page 3 of 4
<PAGE>
9 Signatures
I hereby represent that, to the best of my knowledge and belief, I am
eligible, under federal tax law, to contribute said amount to this annuity
and that the information I have provided above is correct and true. I
understand that all values provided by the contract being applied for, which
are based on the investment experience of the Separate Account, are variable
and are not guaranteed as to the amount.
__________________________________ Signed at _________________________
Signature of Annuitant/Owner City State
Date: _____/_________/___________
Mo. Day Yr.
__________________________________ Date: _____/_________/___________
Signature of Owner Mo. Day Yr.
(if other than Annuitant)
__________________________________ Date: _____/_________/___________
Signature of Joint Owner Mo. Day Yr.
- --------------------------------------------------------------------------------
Account Representative Information (Complete if Applicable)
I personally saw the Proposed Owner when the application was written and each
question was asked and answered as recorded. All answers are correct to the best
of my knowledge. I have delivered a current Enhanced Preference Plus Account
prospectus and reviewed the financial situation of the Proposed Owner as
disclosed; and I believe that a multifunded annuity contract would be suitable.
o Are you licensed in the state of signing? / / Yes / / No
o Has the applicant taken, or will they be taking, any money from a life
insurance policy or annuity contract to put into the annuity the applicant is
applying for (as described in section 6)?
/ / Yes If Yes, please attach a copy of replacement forms.
/ / No
o Was an Asset Allocation Questionnaire used in connection with section 7?
/ / Yes If Yes, please attach a copy to this application.
/ / No
- ----------------------------------------------------- -------------------------
Producer Identity (District, Agency/Agency Index) Agency Telephone Number
Signature
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License ID #
/ /
- ----------------------------------------------- -------------------------
Print Full Name Date Month Day Year
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