As filed with the Securities and Exchange Commission on January 28, 2000
Registration No. 333-________
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Securities and Exchange Commission
Washington, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
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GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
(Exact name of registrant as specified in its charter)
COLORADO
(State or other jurisdiction of incorporation or organization)
84-0467907
(I.R.S. Employer Identification No.)
8515 East Orchard Road
Englewood, Colorado 80111
(800) 537-2033
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
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William T. McCallum
President and Chief Executive Officer
Great-West Life & Annuity Insurance Company
8515 East Orchard Road
Englewood, Colorado 80111
(800) 537-2033
(Name, address, including zip code, and telephone number, including
area code, of agent for service)
Copy to:
James F. Jorden, Esq.
Jorden Burt Boros Cicchetti Berenson & Johnson LLP
1025 Thomas Jefferson Street, N.W., Suite 400 East
Washington, D.C. 20007-0805
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Approximate date of commencement of proposed sale to the public: As soon as
practicable after effectiveness of this Registration Statement.
If the only securities being registered on this Form are to be offered pursuant
to dividend or interest reinvestment plans, please check the following box. [__]
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [ X ]
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [__]
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering.
[--]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box.
[--]
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
Calculation of Registration Fee
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Title of each Amount to be Proposed maximum Proposed maximum Amount of
class of registered offering price per aggregate offering registration fee
securities to unit price
be registered
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Flexible Premium * * $195,857,000 **
Group and
Individual Deferred
Variable and
Fixed Annuity
Contracts
</TABLE>
* The maximum aggregate offering price is estimated solely for the purpose of
determining the registration fee. The amount being registered and the proposed
maximum offering price per unit are not applicable in that these contracts are
not issued in pre-determined amounts or units.
** All of the $200,000,000 aggregate offering price was previously registered on
Form S-1 File No. 333-01173 filed on February 26, 1996. Accordingly, the
registrant hereby removes the remaining $195,857,000 in aggregate offering price
from registration under File No. 333-01173 and registers such amount under this
Registration Statement and no registration fee is due under the Registration
Statement.
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The registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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<PAGE>
[SUBJECT TO COMPLETION]
The information in this Prospectus is not complete and may be changed. We
may not sell these securities until the registration statement is filed
with the Securities and Exchange Commission is effective. This Prospectus
is not an offer to sell these securities and it is not soliciting an offer
to buy these securities in any state where the offer or sale is not
permitted.
Schwab Select Annuity(TM)
A flexible premium deferred variable and fixed annuity
Distributed by
Charles Schwab & Co., Inc.
Issued by
Great-West Life & Annuity Insurance Company
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Overview
This Prospectus describes the Schwab Select Annuity--a flexible premium deferred
annuity contract which allows you to accumulate assets on a tax-deferred basis
for retirement or other long-term purposes. This Contract is issued either on a
group basis or as individual contracts by Great-West Life & Annuity Insurance
Company (we, us, Great-West or GWL&A). Both will be referred to as the
"Contract" throughout this Prospectus.
How to Invest
The minimum initial investment (a "Contribution") is:
o $5,000
o $2,000 if an IRA
o $1,000 if subsequent Contributions are made via Automatic Contribution
Plan
The minimum subsequent Contribution is:
o $500 per Contribution
o $100 per Contribution if made via Automatic Contribution Plan
Allocating Your Money
When you contribute money to the Schwab Select Annuity, you can allocate it
among the Sub-Accounts of the Variable Annuity-1 Series Account which invest in
the following Portfolios:
o Alger American Growth Portfolio
o American Century VP International Portfolio
o BT Insurance Funds Trust EAFE Equity Index Fund
o BT Insurance Funds Trust Small Cap Index Fund
o Baron Capital Asset Fund: Insurance Shares
o Berger IPT Small Company Growth Fund
o Dreyfus Variable Investment Fund Capital Appreciation Portfolio
o Dreyfus Variable Investment Fund Growth and Income Portfolio
o Federated American Leaders Fund II
o Federated Fund for U.S. Government Securities II
o Federated Utility Fund II
o INVESCO VIF-High Yield Fund
o INVESCO VIF-Equity Income Fund
o Janus Aspen Series Growth Portfolio
o Janus Aspen Series Worldwide Growth Portfolio
o Janus Aspen Flexible Income Portfolio
o Janus Aspen International Growth Portfolio
o Montgomery Variable Series: Growth Fund
o Prudential Series Fund Equity Portfolio
o SAFECO Resource Series Trust Equity Portfolio
o SAFECO Resource Series Trust Growth Portfolio
o Schwab MarketTrack Growth Portfolio II
o Schwab Money Market Portfolio
o Schwab S&P 500 Portfolio
o Scudder Variable Life Investment Fund: Capital Growth Portfolio
o Scudder Variable Life Investment Fund: Growth & Income Portfolio
o Strong Schafer Value Fund II
o Van Kampen Life Investment Trust Morgan Stanley Real Estate Securities
Portfolio
These securities have not been approved or disapproved by the Securities and
Exchange Commission or any state securities commission nor has the Securities
and Exchange Commission or any state securities commission passed upon the
accuracy or adequacy of the Prospectus. Any representation to the contrary is a
criminal offense. No person is authorized by Great-West to give information or
to make any representation, other than those contained in this Prospectus, in
connection with the offers contained in this Prospectus. This Prospectus does
not constitute an offering in any jurisdiction in which such offering may not
lawfully be made. Please read this Prospectus and keep it for future reference.
The date of this Prospectus is May 1, 2000.
<PAGE>
You can also allocate some or all of the money you contribute to the Guarantee
Period Fund. The Guarantee Period Fund allows you to select one or more
Guarantee Periods that offer specific interest rates for a specific period.
Please note that the Guarantee Period Fund may not be available in all states.
Sales and Surrender Charges
There are no sales, redemption, surrender or withdrawal charges under the Schwab
Select Annuity.
Free Look Period
After you receive your Contract, you can look it over free of obligation for at
least 10 days or longer if required by your state law (up to 35 days for
replacement policies), during which you may cancel your Contract.
Payout Options
The Schwab Select Annuity offers a variety of annuity payout and periodic
withdrawal options. Depending on the option you select, income can be guaranteed
for your lifetime, your spouse's and/or beneficiaries' lifetime or for a
specified period of time.
The Contracts are not deposits of, or guaranteed or endorsed by any bank, nor
are the Contracts federally insured by the Federal Deposit Insurance
Corporation, the Federal Reserve Board or any other government agency. The
Contracts involve certain investment risks, including possible loss of
principal.
For account information, please contact:
Annuity Administration Department
P.O. Box 173920
Denver, Colorado 80217-3920
800-838-0650
This Prospectus presents important information you should review before
purchasing the Schwab Select Annuity. Please read it carefully and keep it for
future reference. You can find more detailed information pertaining to the
Contract in the Statement of Additional Information dated May 1, 2000 (as may be
amended from time to time), and filed with the Securities and Exchange
Commission. The Statement of Additional Information is incorporated by reference
into this Prospectus and is legally a part of this Prospectus. The table of
contents for the Statement of Additional Information may be found on page 51 of
this Prospectus. You may obtain a copy without charge by contacting the Schwab
Insurance & Annuity Service Center at the above address or phone number. Or, you
can obtain it by visiting the Securities and Exchange Commission's web site at
www.sec.gov. This web site also contains other information about us that has
been filed electronically.
This Prospectus does not constitute an offering in any jurisdiction in which
such offering may not lawfully be made. No dealer, salesperson or other person
is authorized to give any information or make any representations in connection
with this offering other than those contained in this Prospectus, and, if given
or made, such other information or representations must not be relied on.
The contract is not available in all states.
<PAGE>
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Table of Contents
Definitions...............................................4
Summary...................................................6
How to contact Schwab..................................6
Variable Annuity Fee Table................................7
Portfolio Annual Expenses.................................8
Fee Examples..............................................9
Condensed Financial Information..........................10
Great-West Life & Annuity Insurance
Company..................................................10
The Series Account.......................................10
The Portfolios...........................................10
Meeting Investment Objectives.........................13
Where to Find More Information About the Portfolios...13
Addition, Deletion or Substitution....................13
The Guarantee Period Fund................................14
Investments of the Guarantee Period Fund..............14
Subsequent Guarantee Periods..........................14
Breaking a Guarantee Period...........................15
Interest Rates........................................15
Market Value Adjustment...............................15
Application and Initial Contributions....................15
Free Look Period.........................................16
Subsequent Contributions.................................16
Annuity Account Value....................................16
Transfers................................................17
Possible Restrictions.................................17
Automatic Custom Transfers............................17
Cash Withdrawals.........................................19
Withdrawals to Pay Investment Manager or
Financial Advisor Fees................................19
Tax Consequences of Withdrawals.......................19
Telephone Transactions...................................19
Death Benefit............................................20
Beneficiary...........................................20
Distribution of Death Benefit.........................21
Charges and Deductions...................................21
Mortality and Expense Risk Charge.....................21
Contract Maintenance Charge...........................22
Transfer Fees.........................................22
Expenses of the Portfolios............................22
Premium Tax...........................................22
Other Taxes...........................................22
Payout Options...........................................22
Periodic Withdrawals..................................23
Annuity Payouts.......................................23
Seek Tax Advice..........................................25
Federal Tax Matters......................................25
Taxation of Annuities.................................26
Individual Retirement Annuities.......................27
Assignments or Pledges...................................28
Performance Data.........................................28
Money Market Yield....................................28
Average Annual Total Return...........................28
Distribution of the Contracts............................30
Voting Rights............................................50
Rights Reserved by Great-West............................50
Legal Proceedings........................................50
Legal Matters............................................50
Experts..................................................51
Incorporation of Certain Documents by Reference
and Available Information................................51
Appendix A--Condensed Financial
Information..............................................52
Appendix B--Market Value Adjustments......................54
Appendix C--Net Investment Factor.........................56
<PAGE>
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Definitions
1035 Exchange--A provision of the Internal Revenue Code that allows for the
tax-free exchange of assets among certain types of insurance contracts.
Accumulation Period--The time period between the Effective Date and the Annuity
Commencement Date. During this period, you're contributing to the annuity.
Annuitant--The person named in the application upon whose life the payout of an
annuity is based and who will receive annuity payouts. If a Contingent Annuitant
is named, the Annuitant will be considered the Primary Annuitant. Annuity
Account--An account established by us in your name that reflects all account
activity under your Contract. Annuity Account Value--The sum of all the
investment options credited to your Annuity Account--less partial withdrawals,
amounts applied to an annuity payout option, periodic withdrawals, charges
deducted under the Contract, and Premium Tax, if any.
Annuity Commencement Date--The date annuity payouts begin.
Annuity Individual Retirement Account (or Annuity IRA)--An annuity contract used
in a retirement savings program that is intended to satisfy the requirements of
Section 408 of the Internal Revenue Code of 1986, as amended.
Annuity Payout Period--The period beginning on the Annuity Commencement Date and
continuing until all annuity payouts have been made under the Contract. During
this period, the Annuitant receives payouts from the annuity.
Annuity Unit--An accounting measure we use to determine the amount of any
variable annuity payout after the first annuity payout is made.
Automatic Contribution Plan--A feature which allows you to make automatic
periodic Contributions. Contributions will be withdrawn from an account you
specify and automatically credited to your Annuity Account.
Beneficiary--The person(s) designated to receive any Death Benefit under the
terms of the Contract.
Contingent Annuitant--The person you may name in the application who becomes the
Annuitant when the Primary Annuitant dies. The Contingent Annuitant must be
designated before the death of the Primary Annuitant.
Contributions--The amount of money you invest or deposit into your annuity.
Death Benefit--The amount payable to the Beneficiary when the Owner or the
Annuitant dies.
Distribution Period--The period starting with your Payout Commencement Date.
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Schwab Select Annuity Structure
Your total Annuity Account can be
made up of a variable and a fixed account.
Your Annuity Account
Variable Account Fixed Acount
Contains the money you contribute Containes the money you contribute to
to variable investment options fixed investment options
(the Sub-Accounts). (the Guarantee Period Fund).
Sub-Accounts Guarantee Period Fund
Shares of the Portfolios are held You can choose a guaratee period of
in Sub-Accounts. There is one one to ten years.
Sub-Accounts for each Portfolio.
Portfolios,
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Effective Date--The date on which the first Contribution is credited to your
Annuity Account.
Fixed Account Value--The value of the fixed investment option credited to you
under the Annuity Account.
Guarantee Period--The number of years available in the Guarantee Period Fund
during which Great-West will credit a stated rate of interest. Great-West may
discontinue offering a period at any time for new Contributions. Amounts
allocated to one or more guaranteed periods may be subject to a Market Value
Adjustment.
Guarantee Period Fund--A fixed investment option which pays a stated rate of
interest for a specified time period.
Guarantee Period Maturity Date--The last day of any Guarantee Period.
Guaranteed Interest Rate--The minimum annual interest rate in effect that
applies to each Guarantee Period at the time the Contribution is made.
Market Value Adjustment (or MVA)--An amount added to or subtracted from certain
transactions involving the Guarantee Period Fund to reflect the impact of
changing interest rates.
Non-Qualified Annuity Contract--An annuity contract funded with money outside a
tax qualified retirement plan.
Owner (Joint Owner) or You--The person(s) named in the application who is
entitled to exercise all rights and privileges under the Contract, while the
Annuitant is living. Joint Owners must be husband and wife as of the date the
Contract is issued. The Annuitant will be the Owner unless otherwise indicated
in the application. If a Contract is purchased in an IRA, the Owner and the
Annuitant must be the same individual and a Joint Owner is not allowed.
Payout Commencement Date--The date on which annuity payouts or periodic
withdrawals begin under a payout option. The Payout Commencement Date must be at
least one year after the Effective Date of the Contract. If you do not indicate
a Payout Commencement Date on your application, annuity payouts will begin on
the first day of the month of the Annuitant's 91st birthday.
Portfolio--A registered management investment company, or portfolio, in which
the assets of the Annuity Account may be invested.
Premium Tax--A tax charged by a state or other governmental authority. Varying
by state, the current range of Premium Taxes is 0% to 3.5% and may be assessed
at the time you make a Contribution or when annuity payments begin.
Request--Any written, telephoned, or computerized instruction in a form
satisfactory to Great-West and Schwab received at the Annuity Administration
Department at Great-West (or other annuity service center subsequently named)
from you, your designee (as specified in a form acceptable to Great-West and
Schwab) or the Beneficiary (as applicable) as required by any provision of the
Contract.
Series Account--The segregated account established by Great-West under Colorado
law and registered as a unit investment trust under the Investment Company Act
of 1940, as amended.
Sub-Account--A division of the Series Account containing the shares of a
Portfolio. There is a Sub-Account for each Portfolio.
Surrender Value--The value of your annuity account with any applicable Market
Value Adjustment on the Effective Date of the surrender, less Premium Tax, if
any.
Transaction Date--The date on which any Contribution or Request from you will be
processed. Contributions and Requests received after 4:00 p.m. EST/EDT will be
deemed to have been received on the next business day. Requests will be
processed and the variable account value will be determined on each day that the
New York Stock Exchange is open for trading.
Transfer--Moving money from and among the Sub-Account(s) and the Guarantee
Period Fund.
Variable Account Value--The value of the Sub-Accounts credited to you under the
Annuity Account.
<PAGE>
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Summary
The Schwab Select Annuity allows you to accumulate assets on a tax-deferred
basis by investing in a variety of variable investment options (the
Sub-Accounts) and a fixed investment option (the Guarantee Period Fund). The
performance of your Annuity Account Value will vary with the investment
performance of the Portfolios corresponding to the Sub-Accounts you select. You
bear the entire investment risk for all amounts invested in them. Depending on
the performance of the Sub-Accounts you select, your Annuity Account Value could
be less than the total amount of your Contributions.
The Schwab Select Annuity can be purchased on a non-qualified basis or purchased
and used in connection with an IRA. You can also purchase it through a 1035
Exchange from another insurance contract.
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How to contact Schwab:
Schwab Insurance & Annuity Service Center
101 Montgomery Street
San Francisco, CA 94120-7666
Attention: Insurance & Annuities Department
800-838-0650
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Your initial Contribution must be at least $5,000; $2,000 if an IRA; $1,000 if
you are setting up an Automatic Contribution Plan. Subsequent Contributions must
be either $500; or $100 if made through an Automatic Contribution Plan.
The money you contribute to the annuity will be invested at your direction,
except that in some states during your "free look period" your payment will be
allocated to the Schwab Money Market Sub-Account. Your free look period,
depending on your state law, is generally 10 days after you receive your
Contract. Free look allocations are described in more detail on page xx of this
Prospectus.
Prior to the Payout Commencement Date, you can withdraw all or a part of your
Annuity Account Value. There are no surrender or withdrawal charges. Certain
withdrawals may be subject to federal income tax as well as a federal penalty
tax.
When you're ready to start taking money out of your annuity, you can select from
a variety of payout options, including variable and fixed annuity payouts as
well as periodic payouts.
If the Annuitant dies before the Annuity Commencement Date, we will pay the
Death Benefit to the Beneficiary you select. If the Owner dies before the entire
value of the Contract is distributed, the remaining value will be distributed
according to the rules outlined in the "Death Benefit" section on page 20.
For accounts under $50,000, we deduct a $25 annual Contract Maintenance Charge
from the Annuity Account Value on each Contract anniversary date. There is no
annual Contract Maintenance Charge for accounts of $50,000 or more. We also
deduct a Mortality and Expense Risk Charge from your Sub-Accounts at the end of
each daily valuation period equal to an effective annual rate of 0.85% of the
value of the net assets in your Sub-Accounts. Each Portfolio assesses a charge
for management fees and other expenses. These fees and expenses are detailed in
this Prospectus.
You may cancel your Contract during the free look period by sending it to the
Annuity Administration Department at Great-West. If you are replacing an
existing insurance contract with the Contract, the free look period may be
extended based on your state of residence. Free look allocations are described
in more detail on page xx of this Prospectus.
This summary highlights some of the more significant aspects of the Schwab
Select Annuity. You'll find more detailed information about these topics
throughout the Prospectus and in your Contract. Please keep them both for future
reference.
<PAGE>
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Variable Annuity Fee Table
The purpose of the tables and the examples that follow is to help you understand
the various costs and expenses that you will bear directly or indirectly when
investing in the annuity. The tables and examples reflect expenses related to
the Sub-Accounts as well as of the Portfolios. In addition to the expenses
listed below, Premium Tax may be applicable.
Contract Owner transaction expenses1
Sales load None
Surrender fee None
Transfer fee (first 12 per year)2 None
Annual Contract Maintenance Charge3 $25.00
Annual expenses1
(as a percentage of average Variable Account assets)
Mortality and expense risk charge 0.85%
Administrative expense charge 0.00%
Other fees and expenses of the variable account 0.00%
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Total annual expenses 0.85%
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1 The Contract Owner Transaction Expenses apply to each Contract, regardless of
how the Annuity Account Value is allocated. The Annual Expenses do not apply
to the Guarantee Period Fund.
2 There is a $10 fee for each Transfer in excess of twelve in any calendar year.
3 The Contract Maintenance Charge is currently waived for Contracts with an
Annuity Account Value of at least $50,000. If your Annuity Account Value falls
below $50,000 due to a withdrawal, the Contract Maintenance Charge will be
reinstated until such time as your Annuity Account Value is equal to or
greater than $50,000.
<PAGE>
Portfolio Annual Expenses
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<S> <C> <C> <C> <C> <C> <C>
(as a percentage of Portfolio net assets, before and after fee waivers and expense reimbursements)
Portfolio Management Other 12b-1 fees Total Total Fee Total
fees expenses Portfolio Waivers4 Portfolio
Expenses expenses
before after
fee fee
waivers waivers
Alger American Growth
American Century VP International
BT Insurance Funds Trust EAFE Equity Index
BT Insurance Funds Trust Small Cap Index
Baron Capital Asset
Berger IPT-Small Company Growth
Dreyfus Variable Investment Capital Appreciation
Dreyfus Variable Investment Growth and Income TO BE COMPLETED BY AMENDMENT
Federated American Leaders II
Federated U.S. Government Securities II
Federated Utility II
INVESCO VIF-High Yield
INVESCO VIF-Equity Income
Janus Aspen Growth
Janus Aspen Worldwide Growth
Janus Aspen Flexible Income
Janus Aspen International Growth
Montgomery Variable Series: Growth
Prudential Series Fund Equity
SAFECO RST Equity
SAFECO RST Growth
Schwab MarketTrack Growth II
Schwab Money Market
Schwab S&P 500
Scudder Variable Life Investment Fund:
Capital Growth
Scudder Variable Life Investment Fund:
Growth & Income
Strong Schafer Value II
Van Kampen Life Investment Trust--Morgan
Stanley Real Estate Securities
</TABLE>
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4 To be completed by amendment.
<PAGE>
Fee Examples5
If you retain, annuitize or surrender the Contract at the end of the applicable
time period, you would pay the following fees and expenses on a $1,000
investment, assuming a 5% annual return on assets. These examples assume that no
Premium Taxes have been assessed.
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
PORTFOLIO 1 year6 3 years 5 years 10 years
Alger American Growth
American Century VP International
BT Insurance Funds Trust EAFE Equity Index
BT Insurance Funds Trust Small Cap Index
Baron Capital Asset
Berger IPT-Small Company Growth
Dreyfus Variable Investment Capital Appreciation
Dreyfus Variable Investment Growth and Income
Federated American Leaders II
Federated U.S. Government Securities II
Federated Utility II
INVESCO VIF-High Yield
INVESCO VIF-Equity Income
Janus Aspen Growth TO BE COMPLETED BY AMENDMENT
Janus Aspen Worldwide Growth
Janus Aspen Flexible Income
Janus Aspen International Growth
Montgomery Variable Series: Growth
Prudential Series Fund Equity
SAFECO RST Equity
SAFECO RST Growth
Schwab MarketTrack Growth II
Schwab Money Market
Schwab S&P 500
Scudder Variable Life Investment Fund: Capital Growth
Scudder Variable Life Investment Fund: Growth and Income
Strong Schafer Value II
Van Kampen Life Investment Trust-Morgan Stanley
Real Estate Securities
</TABLE>
These examples, including the assumed rate of return, should not be considered
representations of future performance or past or future expenses. Actual
expenses paid or performance achieved may be greater or less than those shown,
subject to the guarantees in the Contract.
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5 The Portfolio Annual Expenses and these examples are based on data provided by
the Portfolios. Great-West has no reason to doubt the accuracy or completeness
of that data, but Great-West has not verified the Portfolios' figures. In
preparing the Portfolio Expense table and the Examples above, Great-West has
relied on the figures provided by the Portfolios.
6 These examples are based on total Portfolio expenses after taking fee waivers
and reimbursements into account.
<PAGE>
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Condensed Financial Information
Attached as Appendix A is a table showing selected information concerning
accumulation units for each Sub-Account for 1996, 1997, 1998 and 1999. An
accumulation unit is the unit of measure that we use to calculate the value of
your interest in a Sub-Account. The accumulation unit values do not reflect the
deduction of certain charges that are subtracted from your Annuity Account
Value, such as the Contract Maintenance Charge. The information in the table is
included in the Series Account's financial statements, which have been audited
by Deloitte & Touche LLP, independent auditors. To obtain a more complete
picture of each Sub-Account's finances and performance, you should also review
the Series Account's financial statements, which are in the Series Account's
Annual Report dated December 31,1999 and contained in the Statement of
Additional Information.
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Great-West Life & Annuity Insurance Company
Great-West is a stock life insurance company that was originally organized under
the laws of the state of Kansas as the National Interment Association. Our name
was changed to Ranger National Life Insurance Company in 1963 and to
Insuramerica Corporation prior to changing to our current name in 1982. In
September of 1990, we re-domesticated under the laws of the state of Colorado.
We are authorized to do business in 49 states, the District of Columbia, Puerto
Rico, U.S. Virgin Islands and Guam.
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The Series Account
We established the Variable Annuity-1 Series Account in accordance with Colorado
laws on July 24, 1995.
The Series Account is registered with the Securities and Exchange Commission
(the "SEC") under the Investment Company Act of 1940 (the "1940 Act"), as a unit
investment trust. Registration under the 1940 Act does not involve supervision
by the SEC of the management or investment practices or policies of the Series
Account.
We own the assets of the Series Account. The income, gains or losses, realized
or unrealized, from assets allocated to the Series Account are credited to or
charged against the Series Account without regard to our other income gains or
losses.
We will at all times maintain assets in the Series Account with a total market
value at least equal to the reserves and other liabilities relating to the
variable benefits under all Contracts participating in the Series Account. Those
assets may not be charged with our liabilities from our other business. Our
obligations under those Contracts are, however, our general corporate
obligations.
The Series Account is divided into 28 Sub-Accounts. Each Sub-Account invests
exclusively in shares of a corresponding investment Portfolio of a registered
investment company (commonly known as a mutual fund). We may in the future add
new or delete existing Sub-Accounts. The income, gains or losses, realized or
unrealized, from assets allocated to each Sub-Account are credited to or charged
against that Sub-Account without regard to the other income, gains or losses of
the other Sub-Accounts. All amounts allocated to a Sub-Account will be fully
invested in Portfolio shares.
We hold the assets of the Series Account. We keep those assets physically
segregated and held separate and apart from our general account assets. We
maintain records of all purchases and redemptions of shares of the Portfolios.
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The Portfolios
The Contract offers a number of Portfolios, corresponding to the Sub-Accounts.
Each Sub-Account invests in a single Portfolio. Each Portfolio is a separate
mutual fund registered under the 1940 Act. More comprehensive information,
including a discussion of potential risks, is found in the current Prospectuses
for the Portfolios (the "Portfolio Prospectuses"). The Portfolio Prospectuses
should be read in connection with this Prospectus. You may obtain a copy of the
Portfolio Prospectuses without charge by request.
Each Portfolio:
o holds its assets separate from the assets of the other Portfolios,
o has its own distinct investment objective and policy, and
o operates as a separate investment fund
The income, gains and losses of one Portfolio generally have no effect on the
investment performance of any other Portfolio.
The Portfolios are not available to the general public directly. The Portfolios
are only available as investment options in variable annuity contracts or
variable life insurance policies issued by life insurance companies or, in some
cases, through participation in certain qualified pension or retirement plans.
Some of the Portfolios have been established by investment advisers which manage
publicly available mutual funds having similar names and investment objectives.
While some of the Portfolios may be similar to, and may in fact be modeled after
publicly available mutual funds, you should understand that the Portfolios are
not otherwise directly related to any publicly available mutual fund.
Consequently, the investment performance of publicly available mutual funds and
any corresponding Portfolios may differ substantially.
The investment objectives of the Portfolios are briefly described below:
The Alger American Fund--advised by Fred Alger Management, Inc. of New York, New
York.
Alger American Growth Portfolio seeks long-term capital appreciation. It focuses
on growing companies that generally have broad product lines, markets, financial
resources and depth of management. Under normal circumstances, the Portfolio
invests primarily in the equity securities of large companies. The Portfolio
considers a large company to have a market capitalization of $1 billion or
greater.
American Century Variable Portfolios, Inc.--advised by American Century
Investment Management, Inc. of Kansas City, Missouri, advisers to the American
Century family of mutual funds.
American Century VP International seeks capital growth by investing primarily in
equity securities of foreign companies. The Fund invests primarily in securities
of issuers in developed countries.
The BT Insurance Funds Trust--advised by Bankers Trust Company of New York, New
York.
BT Insurance Funds Trust Small Cap Index Fund seeks to match, as closely as
possible, before expenses, the performance of the Russell 2000 Small Stock
Index. The Russell 2000 Index emphasizes stocks of small U.S. companies and is a
widely accepted benchmark of small-company stock performance.
BT Insurance Funds Trust EAFE Equity Index Fund seeks to match, as closely as
possible, before expenses, the performance of the Morgan Stanley Capital
International EAFE(R) Index. The EAFE Index emphasizes stocks of companies in
major markets in Europe, Australia, and the Far East and is a widely accepted
benchmark of international stock performance.
Baron Capital Asset Fund--advised by BAMCO, Inc. of New York, New York.
Baron Capital Asset Fund: Insurance Shares seeks capital appreciation through
investments in small and medium sized companies with undervalued assets or
favorable growth prospects. The Fund invests primarily in small sized companies
with market capitalizations of approximately $100 million to $1.5 billion and
medium sized companies with market values of $1.5 billion to $5 billion.
Berger Institutional Products Trust--advised by Berger Associates of Denver,
Colorado.
Berger IPT Small Company Growth Fund seeks capital appreciation by investing
primarily in equity securities (including common and preferred stocks,
convertible debt securities and other securities having equity features) of
small growth companies whose market capitalization, at the time of initial
purchase, is less than the 12-month average of the maximum market capitalization
for companies included in the Russell 2000 Index. This average is updated
monthly.
Dreyfus Variable Investment Fund--advised by The Dreyfus Corporation of New
York, New York.
Dreyfus Variable Investment Fund Capital Appreciation Portfolio seeks long-term
capital growth consistent with the preservation of capital. Its secondary goal
is current income. The Fund generally invests at least 80% of net assets in the
common stock of U.S. and foreign companies. The Fund focuses on "blue-chip"
companies with total market values of more than $5 billion.
Dreyfus Variable Investment Fund Growth and Income Portfolio seeks long-term
capital growth, current income and growth of income consistent with reasonable
investment risk. To pursue these goals, it invests in stocks, bonds and money
market instruments of domestic and foreign issuers.
Federated Insurance Series--advised by Federated Advisers of Pittsburgh,
Pennsylvania.
Federated American Leaders Fund II seeks to achieve long-term growth of capital
as a primary objective and seeks to provide income as a secondary objective
through investment of at least 65 % of its total assets (under normal
circumstances) in common stocks of "blue chip" companies.
Federated Fund for U.S. Government Securities II seeks to provide current income
through investment of at least 65% of its total assets in securities which are
primary or direct obligations of the U.S. government or its agencies or
instrumentalities or which are guaranteed as to principal and interest by the
U.S. government, its agencies, or instrumentalities and in certain
collateralized mortgage obligations, and repurchase agreements.
Federated Utility Fund II seeks to provide high current income and moderate
capital appreciation by investing in a professionally-managed, diversified
portfolio of utility company equity and debt securities.
INVESCO Variable Investment Funds, Inc.--advised by INVESCO Funds Group, Denver,
Colorado. INVESCO Trust Company is the sub-adviser for the INVESCO VIF-Equity
Income Portfolio.
INVESCO VIF-Equity Income Fund is a diversified fund that seeks the highest
possible current income, with the added potential for capital appreciation. The
Fund normally invests at least 65% of its total assets in dividend paying common
stocks. The Fund's equity investments are limited to stocks that can be easily
traded in the U.S.; it may, however, invest in foreign securities in the form of
American Depository Receipts. The rest of the Fund's assets are invested in debt
securities, generally corporate bonds that are rated investment grade or better.
The Fund may also invest up to 15% of its assets in lower-grade debt securities
commonly known as "junk bonds," which generally offer higher interest rates, but
are riskier investments than investment grade securities.
INVESCO VIF-High Yield Fund seeks a high level of current income. It invests
substantially all of its assets in lower-rated debt securities, commonly called
"junk bonds," and preferred stock, including securities issued by foreign
companies. Although these securities carry with them higher risks, they
generally provide higher yields - and therefore higher income - than
higher-rated debt securities.
Janus Aspen Series--advised by Janus Capital Corporation of Denver, Colorado.
Janus Aspen Growth Portfolio seeks long-term growth of capital in a manner
consistent with the preservation of capital. The Portfolio invests primarily in
common stocks selected for their growth potential.
Janus Aspen Worldwide Growth Portfolio seeks long-term growth of capital in a
manner consistent with the preservation of capital. The Portfolio invests
primarily in common stocks of any size throughout the world. The Portfolio
normally invests in issuers from at least five different countries, including
the U.S.
Janus Aspen International Growth Portfolio seeks long-term growth of capital.
The Portfolio normally invests at least 65% of its total assets in securities of
issuers from at least five different countries, excluding the U.S.
Janus Aspen Flexible Income Portfolio seeks to obtain maximum total return,
consistent with preservation of capital. The Portfolio invests in a wide variety
of income-producing securities such as corporate bonds and notes, government
securities and preferred stock. The Portfolio will invest at least 80% of its
assets in income-producing securities and may own an unlimited amount of
high-yield/high-risk fixed income securities and these securities may be a big
part of the Portfolio.
Montgomery Variable Series--advised by Montgomery Asset Management, LLC of San
Francisco, California.
Montgomery Variable Series: Growth Fund seeks long-term capital appreciation by
investing in growth-oriented U.S. companies. The Fund may invest in U.S.
companies of any size, but invests at least 65% of its total assets in those
companies whose shares have a total stock market value (market capitalization)
of at least $1 billion. The Fund's strategy is to identify well-managed U.S.
companies whose share prices appear to be undervalued relative to the firm's
growth potential.
Prudential Series Fund--advised by the Prudential Insurance Company of America
of Newark, New Jersey.
Prudential Series Fund Equity Portfolio seeks capital appreciation through
investment primarily in common stocks of companies, including major established
corporations as well as smaller capitalization companies, that appear to offer
attractive prospects of price appreciation that is superior to broadly-based
stock indexes. Current income, if any, is incidental.
SAFECO Resource Series Trust--advised by SAFECO Asset Management Company of
Seattle, Washington.
SAFECO RST Equity Portfolio seeks growth of capital and the increased income
that ordinarily follows from such growth. The Portfolio invests primarily in
common stocks selected for appreciation potential.
SAFECO RST Growth Portfolio seeks growth of capital and the increased income
that ordinarily follows from such growth. The Portfolio invests primarily in
common stocks selected for appreciation potential.
Schwab Insurance & Annuity Portfolios--advised by Charles Schwab Investment
Management, Inc. of San Francisco, California.
Schwab Money Market Portfolio seeks maximum current income consistent with
liquidity and stability of capital. This Portfolio is neither insured nor
guaranteed by the United States Government and there can be no assurance that it
will be able to maintain a stable net asset value of $1.00 per share.
Schwab MarketTrack Growth Portfolio II seeks to provide high capital growth with
less volatility than an all stock portfolio by investing in a mix of stocks,
bonds, and cash equivalents either directly or through investment in other
mutual funds.
Schwab S&P 500 Portfolio seeks to track the price and dividend performance
(total return) of common stocks of U.S. companies, as represented in the
Standard & Poor's Composite Index of 500 stocks.
Scudder Variable Life Investment Trust--advised by Scudder Kemper Investments,
Inc. of Boston, Massachusetts.
Scudder Variable Life Investment Fund: Capital Growth Portfolio seeks to
maximize long-term capital growth through a broad and flexible investment
program. The Portfolio invests principally in common stocks and preferred stocks
in all sectors of the market, including companies that generate or apply new
technologies, companies that own or develop natural resources, companies that
may benefit from changing consumer demands and lifestyles and foreign companies.
Scudder Variable Life Investment Fund: Growth and Income Portfolio seeks
long-term growth of capital, current income and growth of income. The Portfolio
pursues its goal by investing primarily in common stocks, preferred stocks and
securities convertible into common stocks of companies which offer the prospect
for growth of earnings while paying higher than average current dividends. The
Portfolio may also purchase such securities which do not pay current dividends
but which offer prospects for growth of capital and future income.
The Strong Schafer Value Fund II--advised by Strong Schafer Capital Management,
L.L.C. (SSCM) of Princeton, New Jersey.
The Strong Schafer Value Fund II seeks long-term capital growth. Current income
is a secondary objective. The Fund invests primarily in common stocks of medium-
and large-size companies.
Van Kampen Life Investment Trust--advised by Van Kampen Asset Management Inc. of
Oakbrook Terrace, Illinois.
Van Kampen LIT Morgan Stanley Real Estate Securities Portfolio seeks as a
primary objective, long-term growth of capital by investing in securities of
companies operating in the real estate industry, primarily equity securities of
real estate investment trusts. Current income is a secondary investment
objective.
Meeting Investment Objectives
Meeting investment objectives depends on various factors, including, but not
limited to, how well the Portfolio managers anticipate changing economic and
market conditions. There is no guarantee that any of these Portfolios will
achieve their stated objectives.
Where to Find More Information About the Portfolios
Additional information about the investment objectives and policies of all the
Portfolios and the investment advisory and administrative services and charges
can be found in the current Portfolio Prospectuses, which can be obtained from
the Schwab Insurance & Annuity Service Center.
The Portfolios' Prospectuses should be read carefully before any decision is
made concerning the allocation of Contributions to, or Transfers among, the
Sub-Accounts.
Addition, Deletion or Substitution
Great-West does not control the Portfolios and cannot guarantee that any of the
Portfolios will always be available for allocation of Contributions or
Transfers. We retain the right to make changes in the Series Account and in its
investments. Currently, Schwab must approve certain changes.
Great-West and Schwab reserve the right to discontinue the offering of any
Portfolio. If a Portfolio is discontinued, we may substitute shares of another
Portfolio or shares of another investment company for the discontinued
Portfolio's shares. Any share substitution will comply with the requirements of
the 1940 Act.
If you are contributing to a Sub-Account corresponding to a Portfolio that is
being discontinued, you will be given notice prior to the Portfolio's
elimination.
Based on marketing, tax, investment and other conditions, we may establish new
Sub-Accounts and make them available to Owners at our discretion. Each
additional Sub-Account will purchase shares in a Portfolio or in another mutual
fund or investment vehicle.
If, in our sole discretion, marketing, tax, investment or other conditions
warrant, we may also eliminate one or more Sub-Accounts. If a Sub-Account is
eliminated, we will notify you and request that you to re-allocate the amounts
invested in the eliminated Sub-Account.
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The Guarantee Period Fund
The Guarantee Period Fund is not part of the Series Account. Amounts allocated
to the Guarantee Period Fund will be deposited to, and accounted for, in a
non-unitized market value separate account. As a result, you do not participate
in the performance of the assets through unit values.
Because your Contributions do not receive a unit ownership of assets accounted
for in the separate account, the assets accrue solely to the benefit of
Great-West and any gain or loss in the separate account is borne entirely by
Great-West. You will receive the Contract guarantees made by Great-West for
amounts you contribute to the Guarantee Period Fund.
When you contribute or Transfer amounts to the Guarantee Period Fund, you select
a new Guarantee Period from those available. All Guarantee Periods will have a
term of at least one year. Contributions allocated to the Guarantee Period Fund
will be credited on the Transaction Date we receive them.
Each Guarantee Period will have its own stated rate of interest and maturity
date determined by the date the Guarantee Period is established and the term you
choose.
Currently, Guarantee Periods with annual terms of 1 to 10 years are offered only
in those states where the Guarantee Period Fund is available. The Guarantee
Periods may change in the future, but this will not have an impact on any
Guarantee Period already in effect.
The value of amounts in each Guarantee Period equals Contributions plus interest
earned, less any Premium Tax, amounts distributed, withdrawn (in whole or in
part), amounts Transferred or applied to an annuity option, periodic withdrawals
and charges deducted under the Contract. If a Guarantee Period is broken, a
Market Value Adjustment may be assessed (please see "Breaking a Guarantee
Period" on page 15). Any amount withdrawn or Transferred prior to the Guarantee
Period Maturity Date will be paid in accordance with the Market Value Adjustment
formula. You can read more about Market Value Adjustments on page 15.
Investments of the Guarantee
Period Fund
We use various techniques to invest in assets that have similar characteristics
to our general account assets--especially cash flow patterns. We will primarily
invest in investment-grade fixed income securities including: o Securities
issued by the U.S. Government or its agencies or instrumentalities, which may or
may not be guaranteed by the
U.S. Government.
o Debt securities which have an investment grade, at the time of purchase,
within the four highest grades assigned by Moody's Investment Services,
Inc. (Aaa, Aa, A or Baa), Standard & Poor's Corporation (AAA, AA, A or BBB)
or any other nationally recognized rating service.
o Other debt instruments, including, but not limited to, issues of banks or
bank holding companies and of corporations, which obligations--although not
rated by Moody's, Standard & Poor's, or other nationally recognized rating
firms--are deemed by us to have an investment quality comparable to
securities which may be purchased as stated above.
o Commercial paper, cash or cash equivalents and other short-term investments
having a maturity of less than one year which are considered by us to have
investment quality comparable to securities which may be purchased as
stated above.
In addition, we may invest in futures and options solely for non-speculative
hedging purposes. We may sell a futures contract or purchase a put option on
futures or securities to protect the value of securities held in or to be sold
for the general account or the non-unitized separate account if the securities
prices are anticipated to decline. Similarly, if securities prices are expected
to rise, we may purchase a futures contract or a call option against anticipated
positive cash flow or may purchase options on securities.
The above information generally describes the investment strategy for the
Guarantee Period Fund. However, we are not obligated to invest the assets in the
Guarantee Period Fund according to any particular strategy, except as may be
required by Colorado and other state insurance laws. And, the stated rate of
interest that we establish will not necessarily relate to the performance of the
non-unitized market value separate account.
Subsequent Guarantee Periods
Before annuity payouts begin, you may reinvest the value of amounts in a
maturing Guarantee Period in a new Guarantee Period of any length we offer at
that time. On the quarterly statement you receive prior to the end of any
Guarantee Period, we will notify you of the upcoming maturity of a Guarantee
Period. The Guarantee Period available for new Contributions may be changed at
any time, including between the date we notify you of a maturing Guarantee
Period and the date a new Guarantee Period begins.
If you do not tell us where you would like the amounts in a maturing Guarantee
Period allocated by the maturity date, we will automatically allocate the amount
to a Guarantee Period of the same length as the maturing period. If the term
previously chosen is no longer available, the amount will be allocated to the
next shortest available Guarantee Period term. If none of the above are
available, the value of matured Guarantee Periods will be allocated to the
Schwab Money Market Sub-Account.
No Guarantee Period may mature later than six months after your Payout
Commencement Date. For example, if a 3-year Guarantee Period matures and the
Payout Commencement Date begins 1 3/4 years from the Guarantee Period maturity
date, the matured value will be transferred to a 2-year Guarantee Period.
Breaking a Guarantee Period
If you begin annuity payouts, Transfer or withdraw prior to the Guarantee Period
maturity date, you are breaking a Guarantee Period. When we receive a request to
break a Guarantee Period and you have another Guarantee Period that is closer to
its maturity date, we will break that Guarantee Period first.
If you break a Guarantee Period, you may be assessed an interest rate adjustment
called a Market Value Adjustment.
Interest Rates
The declared annual rates of interest are guaranteed throughout the Guarantee
Period. For Guarantee Periods not yet in effect, Great-West may declare interest
rates different than those currently in effect. When a subsequent Guarantee
Period begins, the rate applied will be equal to or more than the rate currently
in effect for new Contracts with the same Guarantee Period.
The stated rate of interest must be at least equal to the Guaranteed Interest
Rate, but Great-West may declare higher rates. The Guaranteed Interest Rate is
based on the applicable state standard non-forfeiture law. The standard
non-forfeiture rate in all states is 3%, except in Florida, Mississippi and
Oklahoma, it's 0%.
The determination of the stated interest rate is influenced by, but does not
necessarily correspond to, interest rates available on fixed income investments
which Great-West may acquire using funds deposited into the Guarantee Period
Fund. In addition, Great-West considers regulatory and tax requirements, sales
and administrative expenses, general economic trends and competitive factors in
determining the stated interest rate.
Market Value Adjustment
Amounts you allocate to the Guarantee Period Fund may be subject to an interest
rate adjustment called a Market Value Adjustment if you exercise your free look
privilege or, if six months or more before the fund's maturity date, you:
o surrender your investment in the fund,
o transfer money from the fund,
o partially withdraw money from the fund,
o apply amounts from the fund to purchase an annuity to receive payouts
from your account, or
o take a distribution from the fund upon the death of the Owner or the
Annuitant.
The Market Value Adjustment will not apply to any Guarantee Period having fewer
than six months prior to the Guarantee Period maturity date in each of the
following situations:
o Transfer to a Sub-Account offered under this Contract
o Surrenders, partial withdrawals, annuitization or periodic withdrawals
o A single sum payout upon death of the Owner or Annuitant
A Market Value Adjustment may increase or decrease the amount payable on the
above-described distributions. The formula for calculating Market Value
Adjustments is detailed in Appendix B. Appendix B also includes examples of how
Market Value Adjustments work.
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Application and Initial Contributions
The first step to purchasing the Schwab Select Annuity is to complete your
Contract application and submit it with your initial minimum Contribution of
$5,000; $2,000 if an IRA; or $1,000 if you are setting up an Automatic
Contribution Plan. Initial Contributions can be made by check (payable to GWL&A)
or transferred from a Schwab brokerage account.
If your application is complete, your Contract will be issued and your
Contribution will be credited within two business days after receipt at the
Annuity Administration Department at Great-West. Acceptance is subject to
sufficient information in a form acceptable to us. We reserve the right to
reject any application or Contribution.
If your application is incomplete, the Annuity Administration Department will
complete the application from information Schwab has on file or contact you by
telephone to obtain the required information. If the information necessary to
complete your application is not received within five business days, we will
return to you both your check and the application. If you provide consent we
will retain the initial Contribution and credit it as soon as we have completed
your application.
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Free Look Period
During the ten-day free look period (or longer where required by law), you may
cancel your Contract. If you exercise the free look privilege, you must return
the Contract to the Annuity Administration Department at Great-West.
Generally, Contributions will be allocated to one or more of the Sub-Accounts
you selected on the application, effective upon the Transaction Date. During the
free look period, you may change the Sub-Accounts in which you'd like to invest
as well as your allocation percentages.
Any returned Contracts will be void from the date we issued the Contract and we
will refund your current Annuity Account Value. This amount may be higher or
lower than your Contributions, which means you bear the investment risk during
the free look period.
Certain states require that we return the greater of your Annuity Account Value
(less any surrenders, withdrawals, and distributions already received) or the
amount of Contributions received. In these states, all Contributions will be
processed as follows:
o Amounts you specify to be allocated to one or more of the available Guarantee
Periods will be allocated as directed, effective upon the Transaction Date.
o Amounts you specify to be allocated to one or more of the Sub-Accounts will
first be allocated to the Schwab Money Market Sub-Account until the end of the
free look period. After the free look period is over, the Variable Account Value
held in the Schwab Money Market Sub-Account will be allocated to the
Sub-Accounts you selected on the application.
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Subsequent Contributions
Once your application is complete and we have received your initial
Contribution, you can make subsequent Contributions at any time prior to the
Payout Commencement Date, as long as the Annuitant is living. Additional
Contributions must be at least $500; or $100 if made via an Automatic
Contribution Plan. Total Contributions may exceed $1,000,000 with our prior
approval.
Subsequent Contributions can be made by check or via an Automatic Contribution
plan directly from your bank or savings account. You can designate the date
you'd like your subsequent Contributions deducted from your account each month.
If you make subsequent Contributions by check, your check should be payable to
GWL&A.
You'll receive a confirmation of each Contribution you make upon its acceptance.
Great-West reserves the right to modify the limitations set forth in this
section.
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Annuity Account Value
Before the date annuity payouts begin, your Annuity Account Value is the sum of
your Variable and Fixed Accounts established under your Contract.
Before your Annuity Commencement Date, the Variable Account Value is the total
dollar amount of all accumulation units credited to you for each Sub-Account.
Initially, the value of each accumulation unit was set at $10.00. Each
Sub-Account's value prior to the Payout Commencement Date is equal to:
o net Contributions allocated to the corresponding Sub-Account,
o plus or minus any increase or decrease in the value of the assets of the
Sub-Account due to investment results, o minus the daily mortality and expense
risk charge, o minus reductions for the Contract Maintenance Charge deducted on
the contract anniversary o minus any applicable Transfer fees and o minus any
withdrawals or Transfers from the Sub-Account.
The value of a Sub-Account's assets is determined at the end of each day that
the New York Stock Exchange is open for regular business (a valuation date). A
valuation period is the period between successive valuation dates. It begins at
the close of the New York Stock Exchange (generally 4:00 p.m. Eastern time) on
each valuation date and ends at the close of the New York Stock Exchange on the
next succeeding valuation date.
The Variable Account Value is expected to change from valuation period to
valuation period, reflecting the investment experience of the selected
Sub-Account(s), as well as the deductions for applicable charges.
Upon allocating Variable Account Values to a Sub-Account you will be credited
with variable accumulation units in that Sub-Account. The number of accumulation
units you will be credited is determined by dividing the portion of each
Contribution allocated to the Sub-Account by the value of an accumulation unit.
The value of the accumulation unit is determined and credited at the end of the
valuation period during which the Contribution was received.
Each Sub-Account's accumulation unit value is established at the end of each
valuation period. It is calculated by multiplying the value of that unit at the
end of the prior valuation period by the Sub-Account's Net Investment Factor for
the valuation period. The formula used to calculate the Net Investment Factor is
discussed in Appendix C.
Unlike a brokerage account, amounts held under a Contract are not covered by the
Securities Investor Protection Corporation ("SIPC").
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Transfers
Prior to the Annuity Commencement Date you may Transfer all or part of your
Annuity Account Value among and between the Sub-Accounts and the available
Guarantee Periods by telephone, by sending a Request to the Annuity
Administration Department at Great-West or by calling our touch-tone account and
trading service.
Your Request must specify:
o the amounts being Transferred,
o the Sub-Account(s) and/or Guarantee Period(s) from which the Transfer is to be
made, and o the Sub-Account(s) and/or Guarantee Period(s) that will receive the
Transfer.
Currently, there is no limit on the number of Transfers you can make among the
Sub-Accounts and the Guarantee Period Fund during any calendar year. However, we
reserve the right to limit the number of Transfers you make.
There is no charge for the first twelve Transfers each calendar year, but there
will be a charge of $10 for each additional Transfer made. The charge will be
deducted from the amount Transferred. All Transfers made on a single Transaction
Date will count as only one Transfer toward the twelve free Transfers. However,
if a one-time rebalancing Transfer also occurs on the Transaction Date, it will
be counted as a separate and additional Transfer.
A Transfer generally will be effective on the date the Request for Transfer is
received by the Annuity Administration Department at Great-West if received
before 4:00 p.m. Eastern time. Under current tax law, there will not be any tax
liability to you if you make a Transfer.
Transfers involving the Sub-Accounts will result in the purchase and/or
cancellation of accumulation units having a total value equal to the dollar
amount being Transferred. The purchase and/or cancellation of such units is made
using the Variable Account Value as of the end of the valuation date on which
the Transfer is effective.
When you make a Transfer from amounts in a Guarantee Period before the Guarantee
Period maturity date, the amount Transferred may be subject to a Market Value
Adjustment as discussed on page 15. If you request in advance to Transfer
amounts from a maturing Guarantee Period upon maturity, your Transfer will not
count toward the 12 free Transfers and no Transfer fees will be charged.
Possible Restrictions
We reserve the right without prior notice to modify, restrict, suspend or
eliminate the Transfer privileges (including telephone Transfers) at any time.
For example, Transfer restrictions may be necessary to protect you from the
negative effect large and/or numerous Transfers can have on portfolio
management. Moving significant amounts from one Sub-Account to another may
prevent the underlying Portfolio from taking advantage of long-term investment
opportunities because the Portfolio must maintain enough cash to cover the
cancellation of accumulation units that results from a Transfer out of a
Sub-Account. Moving large amounts of money may also cause a substantial increase
in Portfolio transaction costs which must be indirectly borne by you.
As a result, we reserve the right to require that all Transfer requests be made
by you and not by your designee and to require that each Transfer request be
made by a separate communication to us. We also reserve the right to require
that each Transfer request be submitted in writing and be signed by you.
Transfers among the Sub-Accounts may also be subject to such terms and
conditions as may be imposed by the Portfolios.
Automatic Custom Transfers
Dollar Cost Averaging
Dollar cost averaging allows you to make systematic Transfers from one
Sub-Account to any other of the Sub-Accounts. Dollar cost averaging allows you
to buy more units when the price is low and fewer units when the price is high.
Over time, your average cost per unit may be more or less than if you invested
all your money at one time. However, dollar cost averaging does not assure a
greater profit, or any profit, and will not prevent or necessarily alleviate
losses in a declining market.
You can set up automatic dollar cost averaging on a monthly, quarterly,
semi-annual or annual basis. Your Transfer will be initiated on the Transaction
Date one frequency period following the date of the request. For example, if you
request quarterly Transfers on January 9, your first Transfer will be made on
April 9 and every three months on the 9th thereafter. Transfers will continue on
that same day each interval unless terminated by you or for other reasons as set
forth in the Contract.
If there are insufficient funds in the applicable Sub-Account on the date your
Transfer is scheduled, your Transfer will not be made. However, your dollar cost
averaging Transfers will resume once there are sufficient funds in the
applicable Sub-Account. Dollar cost averaging will terminate automatically when
you start taking payouts from the annuity. Dollar cost averaging Transfers are
not included in the twelve free Transfers allowed in a calendar year.
Dollar cost averaging Transfers must meet the following conditions:
o The minimum amount that can be Transferred out of the selected Sub-Account is
$100.
o You must:
(1) specify the dollar amount to be Transferred,
(2) designate the Sub-Account(s) to which the Transfer will be made, and
(3) designate the percent of the dollar amount to be allocated to each Sub-
Account into which you are Transferring money. The accumulation unit
values will be determined on the Transfer date.
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Here's how dollar cost averaging works:
-------- ------------ ---------- ---------
Contribution Units Price
Month Purchased per unit
-------- ------------ ---------- ---------
-------- ------------ ---------- ---------
Jan. $250 10 $25.00
-------- ------------ ---------- ---------
-------- ------------ ---------- ---------
Feb. 250 12 20.83
-------- ------------ ---------- ---------
-------- ------------ ---------- ---------
Mar. 250 20 12.50
-------- ------------ ---------- ---------
-------- ------------ ---------- ---------
Apr. 250 20 12.50
-------- ------------ ---------- ---------
-------- ------------ ---------- ---------
May 250 15 16.67
-------- ------------ ---------- ---------
-------- ------------ ---------- ---------
June 250 12 20.83
-------- ------------ ---------- ---------
Average market value per unit $18.06
Investor's average cost per unit $16.85
In the chart above, if all units had been purchased at one time at the highest
unit value of $25.00, only 60 units could have been purchased with $1500. By
contributing smaller amounts over time, dollar cost averaging allowed 89 units
to be purchased with $1500 at an average unit price of $16.85. This investor
purchased 29 more units at $1.21 less per unit than the average market value per
unit of $18.06.
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You may not participate in dollar cost averaging and rebalancer at the same
time.
Great-West reserves the right to modify, suspend or terminate dollar cost
averaging at any time.
Rebalancer
Over time, variations in each Sub-Account's investment results will change your
asset allocation plan percentages. Rebalancer allows you to automatically
reallocate your Variable Account Value to maintain your desired asset
allocation. Participation in Rebalancer does not assure a greater profit, or any
profit, nor will it prevent or necessarily alleviate losses in a declining
market.
You can set up rebalancer as a one-time Transfer or on a quarterly, semi-annual
or annual basis. If you select to rebalance only once, the Transfer will take
place on the Transaction Date of the request. One-time Rebalancer Transfers
count toward the twelve free Transfers allowed in a calendar year.
If you select to rebalance on a quarterly, semi-annual or annual basis, the
first Transfer will be initiated on the Transaction Date one frequency period
following the date of the request. For example, if you request quarterly
Transfers on January 9, your first Transfer will be made on April 9 and every
three months on the 9th thereafter. Transfers will continue on that same day
each interval unless terminated by you or for other reasons as set forth in the
Contract. Quarterly, semi-annual and annual Transfers will not count toward the
12 free Transfers.
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Here's how rebalancer works:
Suppose you purchased your annuity and you decided to allocate 60% of your
initial contribution to stocks; 30% to bonds and 10% to cash equivalents as in
this pie chart:
[GRAPHIC OMITTED - a pie chart = Stocks 60% (Large Company 30%, Small Company
15%, International 15%); Bonds 30%; Cash 10%]
Now assume that stock portfolios outperform bond portfolios and cash equivalents
over a certain period of time. Over this period, the unequal performance may
alter the asset allocation of the above hypothetical plan to look like this:
[GRAPHIC OMITTED - a pie chart = Stocks 75% (Large Company 35%, Small Company
20%, International 20%); Bonds 20%; Cash 5%]
Rebalancer automatically reallocates your Variable Account Value to maintain
your desired asset allocation. In this example, the portfolio would be
re-allocated back to 60% in stocks; 30% in bonds; 10% in cash equivalents.
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On the Transaction Date for the specified request, assets will be automatically
reallocated to the Sub-Accounts you selected. The rebalancer option will
terminate automatically when you start taking payouts from the annuity.
Rebalancer Transfers must meet the following conditions:
o Your entire Variable Account Value must be included.
o You must specify the percentage of your Variable Account Value you'd like
allocated to each Sub-Account and the frequency of rebalancing. You may
modify the allocations or stop the rebalancer option at any time.
o You may not participate in dollar cost averaging and rebalancer at the
same time.
Great-West reserves the right to modify, suspend, or terminate the rebalancer
option at any time.
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Cash Withdrawals
You may withdraw all or part of your Annuity Account Value at any time during
the life of the Annuitant and prior to the date annuity payouts begin by
submitting a written withdrawal request to the Annuity Administration Department
at Great-West. Withdrawals are subject to the rules below and federal or state
laws, rules or regulations may also apply. The amount payable to you if you
surrender your Contract is your Annuity Account Value, with any applicable
Market Value Adjustment on the Effective Date of the surrender, less any
applicable Premium Tax. No withdrawals may be made after the date annuity
payouts begin.
If you request a partial withdrawal, your Annuity Account Value will be reduced
by the dollar amount withdrawn. A Market Value Adjustment may apply. Market
Value Adjustments are discussed on page 15.
Partial withdrawals are unlimited. However, you must specify the Sub-Account(s)
or Guarantee Period(s) from which the withdrawal is to be made. After any
partial withdrawal, if your remaining Annuity Account Value is less than $2,000,
then a full surrender may be required. The minimum partial withdrawal (before
application of the MVA) is $500.
The following terms apply to withdrawals:
o Partial withdrawals or surrenders are not permitted after the date annuity
payouts begin. o A partial withdrawal or a surrender will be effective upon the
Transaction Date. o A partial withdrawal or a surrender from amounts in a
Guarantee Period may be subject to the Market Value Adjustment
provisions, and the Guarantee Period Fund provisions of the Contract.
Withdrawal requests must be in writing with your original signature. If your
instructions are not clear, your request will be denied and no withdrawal or
partial withdrawal will be processed.
After a withdrawal of all of your Annuity Account Value, or at any time that
your Annuity Account Value is zero, all your rights under the Contract will
terminate.
Withdrawals to Pay Investment Manager or Financial Advisor Fees
You may request partial withdrawals from your Annuity Account Value and direct
us to remit the amount withdrawn directly to your designated Investment Manager
or Financial Advisor (collectively "Consultant"). A withdrawal request for this
purpose must meet the $500 minimum withdrawal requirements and comply with all
terms and conditions applicable to partial withdrawals, as described above. Tax
consequences of withdrawals are detailed below, but you should consult a
competent tax advisor prior to authorizing a withdrawal from your Annuity
Account to pay Consultant fees.
Tax Consequences of Withdrawals
Withdrawals made for any purpose may be taxable--including payments made by us
directly to your Consultant.
In addition, the Internal Revenue Code may require us to withhold federal income
taxes from withdrawals and report such withdrawals to the IRS. If you request
partial withdrawals to pay Consultant fees, your Annuity Account Value will be
reduced by the sum of the fees paid to the Consultant and the related
withholding.
You may elect, in writing, to have us not withhold federal income tax from
withdrawals, unless withholding is mandatory for your Contract. If you are
younger than 59 1/2, the taxable portion of any withdrawal is generally
considered to be an early withdrawal and is subject to an additional federal
penalty tax of 10%.
Withholding applies only if the taxable amount of the withdrawal is at least
$200. Some states also require withholding for state income taxes. For details
about withholding, please see "Federal Tax Matters" on page 25.
If you are interested in this Contract as an IRA, please refer to Section 408 of
the Internal Revenue Code of 1986, as amended, for limitations and restrictions
on cash withdrawals.
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Telephone Transactions
You may make Transfer requests by telephone. Telephone Transfer requests
received before 4:00 p.m. Eastern time will be made on that day at that day's
unit value. Calls completed after 4:00 p.m. Eastern time will be made on the
next business day we and the NYSE are open for business, at that day's unit
value.
We will use reasonable procedures to confirm that instructions communicated by
telephone are genuine, such as: o requiring some form of personal identification
prior to acting on instructions, o providing written confirmation of the
transaction and/or o tape recording the instructions given by telephone.
If we follow such procedures we will not be liable for any losses due to
unauthorized or fraudulent instructions.
We reserve the right to suspend telephone transaction privileges at any time,
for some or all Contracts, and for any reason. Withdrawals are not permitted by
telephone.
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Before the date when annuity payouts begin, the Death Benefit, if any, will be
equal to the greater of:
o the Annuity Account Value with an MVA, if applicable, as of the date
the request for payout is received, less any Premium Tax, or
o the sum of Contributions, less partial withdrawals and/or periodic
withdrawals, less any Premium Tax.
The Death Benefit will become payable following our receipt of the Beneficiary's
claim in good order. When an Owner or the Annuitant dies before the Annuity
Commencement Date and a Death Benefit is payable to a Beneficiary, the Death
Benefit proceeds will remain invested according to the allocation instructions
given by the Owner(s) until new allocation instructions are requested by the
Beneficiary or until the Death Benefit is actually paid to the Beneficiary.
The amount of the Death Benefit will be determined as of the date payouts begin.
However, on the date a payout option is processed, the Variable Account Value
will be Transferred to the Schwab Money Market Sub-Account unless the
Beneficiary elects otherwise.
Subject to the distribution rules below, payout of the Death Benefit may be made
as follows:
Variable Account Value
o payout in a single sum, or
o payout under any of the variable annuity options provided under this
Contract.
Fixed Account Value
o payout in a single sum that may be subject to a Market Value Adjustment,
or
o payout under any of the annuity options provided under this Contract
that may be subject to a Market Value Adjustment
Any payment within 6 months of the Guarantee Period Maturity Date will not be
subject to a Market Value Adjustment.
In any event, no payout of benefits provided under the Contract will be allowed
that does not satisfy the requirements of the Internal Revenue Code and any
other applicable federal or state laws, rules or regulations.
Beneficiary
You may select one or more Beneficiaries. If more than one Beneficiary is
selected, they will share equally in any Death Benefit payable unless you
indicate otherwise. You may change the Beneficiary any time before the
Annuitant's death.
A change of Beneficiary will take effect as of the date the request is processed
by the Annuity Administration Department at Great-West, unless a certain date is
specified by the Owner. If the Owner dies before the request is processed, the
change will take effect as of the date the request was made, unless we have
already made a payout or otherwise taken action on a designation or change
before receipt or processing of such request. A Beneficiary designated
irrevocably may not be changed without the written consent of that Beneficiary,
except as allowed by law.
The interest of any Beneficiary who dies before the Owner or the Annuitant will
terminate at the death of the Beneficiary. The interest of any Beneficiary who
dies at the time of, or within 30 days after the death of an Owner or the
Annuitant will also terminate if no benefits have been paid to such Beneficiary,
unless the Owner otherwise indicates by request. The benefits will then be paid
as though the Beneficiary had died before the deceased Owner or Annuitant. If no
Beneficiary survives the Owner or Annuitant, as applicable, we will pay the
Death Benefit proceeds to the Owner's estate.
If the Beneficiary is not the Owner's surviving spouse, she/he may elect, not
later than one year after the Owner's date of death, to receive the Death
Benefit in either a single sum or payout under any of the variable or fixed
annuity options available under the Contract, provided that:
o such annuity is distributed in substantially equal installments over the
life or life expectancy of the Beneficiary or over a period not extending
beyond the life expectancy of the Beneficiary and
o such distributions begin not later than one year after the Owner's date of
death.
If an election is not received by Great-West from a non-spouse Beneficiary and
substantially equal installments begin no later than one year after the Owner's
date of death, then the entire amount must be distributed within five years of
the Owner's date of death. The Death Benefit will be determined as of the date
the payouts begin.
If a corporation or other non-individual entity is entitled to receive benefits
upon the Owner's death, the Death Benefit must be completely distributed within
five years of the Owner's date of death.
Distribution of Death Benefit
Death of Annuitant
Upon the death of the Annuitant while the Owner is living, and before the
Annuity Commencement Date, we will pay the Death Benefit to the Beneficiary
unless there is a Contingent Annuitant.
If a Contingent Annuitant was named by the Owner(s) prior to the Annuitant's
death, and the Annuitant dies before the Annuity Commencement Date while the
Owner and Contingent Annuitant are living, no Death Benefit will be payable and
the Contingent Annuitant will become the Annuitant.
If the Annuitant dies after the date annuity payouts begin and before the entire
interest has been distributed, any benefit payable must be distributed to the
Beneficiary according to and as rapidly as under the payout option which was in
effect on the Annuitant's date of death.
If the deceased Annuitant is an Owner, or if a corporation or other
non-individual is an Owner, the death of the Annuitant will be treated as the
death of an Owner and the Contract will be subject to the "Death of Owner"
provisions described below.
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Contingent Annuitant While the Annuitant is living, you may, by Request,
designate or change a Contingent Annuitant from time to time. A change of
Contingent Annuitant will take effect as of the date the request is processed at
the Annuity Administration Department at Great-West, unless a certain date is
specified by the Owner(s). Please note, you are not required to designate a
Contingent Annuitant.
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Death of Owner Who Is Not the Annuitant
If there is a Joint Owner who is the surviving spouse and the Beneficiary of the
deceased Owner, the Joint Owner becomes the Owner and Beneficiary and the Death
Benefit will be paid to the Joint Owner or the Joint Owner may elect to take the
Death Benefit or to continue the Contract in force.
If the Owner dies after annuity payouts commence and before the entire interest
has been distributed while the Annuitant is living, any benefit payable will
continue to be distributed to the Annuitant as rapidly as under the payout
option applicable on the Owner's date of death. All rights granted the Owner
under the Contract will pass to any surviving Joint Owner and, if none, to the
Annuitant.
In all other cases, we will pay the Death Benefit to the Beneficiary even if a
Joint Owner (who was not the Owner's spouse on the date of the Owner's death),
the Annuitant and/or the Contingent Annuitant are alive at the time of the
Owner's death, unless the sole Beneficiary is the deceased Owner's surviving
spouse who may elect to become the Owner and Annuitant and to continue the
Contract in force.
Death of Owner Who Is the Annuitant
If there is a Joint Owner who is the surviving spouse of the deceased Owner and
a Contingent Annuitant, the Joint Owner becomes the Owner and the Beneficiary,
the Contingent Annuitant will become the Annuitant, and the Contract will
continue in force.
If there is a Joint Owner who is the surviving spouse and the Beneficiary of the
deceased Owner but no Contingent Annuitant, the Joint Owner will become the
Owner, Annuitant and Beneficiary and may elect to take the Death Benefit or
continue the Contract in force.
In all other cases, we will pay the Death Benefit to the Beneficiary, even if a
Joint Owner (who was not the Owner's spouse on the date of the Owner's death),
Annuitant and/or Contingent Annuitant are alive at the time of the Owner's
death, unless the sole Beneficiary is the deceased Owner's surviving spouse who
may elect to become the Owner and Annuitant and to continue the Contract in
force.
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Charges and Deductions
No amounts will be deducted from your Contributions except for any applicable
Premium Tax. As a result, the full amount of your Contributions (less any
applicable Premium Tax) are invested in the Contract.
As more fully described below, charges under the Contract are assessed only as
deductions for:
o Premium Tax, if applicable,
o Certain Transfers,
o a Contract Maintenance Charge, and
o charges against your Variable Account Value for our assumption of
mortality and expense risks.
Mortality and Expense Risk Charge
We deduct a Mortality and Expense Risk Charge from your Variable Account Value
at the end of each valuation period to compensate us for bearing certain
mortality and expense risks under the Contract. This is a daily charge equal to
an effective annual rate of 0.85%. The approximate portion of this charge
attributable to mortality risks is 0.68%. The approximate portion of this charge
estimated to be attributable to expense risk is 0.17%. We guarantee that this
charge will never increase beyond 0.85%.
The Mortality and Expense Risk Charge is reflected in the unit values of each of
the Sub-Accounts you have selected. Thus, this charge will continue to be
applicable should you choose a variable annuity payout option or the periodic
withdrawal option.
Annuity Account Values and annuity payouts are not affected by changes in actual
mortality experience incurred by us. The mortality risks assumed by us arise
from our contractual obligations to make annuity payouts determined in
accordance with the annuity tables and other provisions contained in the
Contract. This means that you can be sure that neither the Annuitant's longevity
nor an unanticipated improvement in general life expectancy will adversely
affect the annuity payouts under the Contract.
We bear substantial risk in connection with the Death Benefit before the Annuity
Commencement Date.
The expense risk assumed is the risk that our actual expenses in administering
the Contracts and the Series Account will be greater than we anticipated.
If the Mortality and Expense Risk Charge is insufficient to cover actual costs
and risks assumed, the loss will fall on us. If this charge is more than
sufficient, any excess will be profit to us. Currently, we expect a profit from
this charge. Our expenses for distributing the Contracts will be borne by our
general assets, including any profits from this charge.
Contract Maintenance Charge
We currently deduct a $25 annual Contract Maintenance Charge from the Annuity
Account Value on each Contract anniversary date for accounts under $50,000. This
charge partially covers our costs for administering the Contracts and the Series
Account. Once you have started receiving payouts from the annuity, this charge
will stop unless you choose the periodic withdrawal option.
The Contract Maintenance Charge is deducted from the portion of your Annuity
Account Value allocated to the Schwab Money Market Sub-Account. If the portion
of your Annuity Account Value in this Sub-Account is not sufficient to cover the
Contract Maintenance Charge, then the charge or any portion of it will be
deducted on a pro rata basis from all your Sub-Accounts with current value. If
the entire Annuity Account is held in the Guarantee Period Fund or there are not
enough funds in any Sub-Account to pay the entire charge, then the Contract
Maintenance Charge will be deducted on a pro rata basis from amounts held in all
Guarantee Periods. There is no MVA on amounts deducted from a Guarantee Period
for the Contract Maintenance Charge.
The Contract Maintenance Charge is currently waived for Contracts with an
Annuity Account Value of at least $50,000. If your Annuity Account Value falls
below $50,000, the Contract Maintenance Charge will be reinstated until such
time as your Annuity Account Value is equal to or greater than $50,000. We do
not expect a profit from amounts received from the Contract Maintenance Charge.
Transfer Fees
There will be a $10 charge for each Transfer in excess of 12 Transfers in any
calendar year. We do not expect a profit from the Transfer fees.
Expenses of the Portfolios
The value of the assets in the Sub-Accounts reflect the value of Portfolio
shares and therefore the fees and expenses paid by each Portfolio. A complete
description of the fees, expenses, and deductions from the Portfolios is
included in this Prospectus under the Variable Annuity Fee Table and Portfolio
Annual Expenses on page 7 and 8.
Premium Tax
We may be required to pay state Premium Taxes or retaliatory taxes currently
ranging from 0% to 3.5% in connection with Contributions or values under the
Contracts. Depending upon applicable state law, we will deduct charges for the
Premium Taxes we incur with respect to your Contributions, from amounts
withdrawn, or from amounts applied on the Payout Commencement Date. In some
states, charges for both direct Premium Taxes and retaliatory Premium Taxes may
be imposed at the same or different times with respect to the same Contribution,
depending on applicable state law.
Other Taxes
Under present laws, we will incur state or local taxes (in addition to the
Premium Tax described above) in several states. No charges are currently made
for taxes other than Premium Tax. However, we reserve the right to deduct
charges in the future for federal, state, and local taxes or the economic burden
resulting from the application of any tax laws that we determine to be
attributable to the Contract.
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Payout Options
During the Distribution Period, you can choose to receive payouts in four
ways--through periodic withdrawals, variable annuity payouts, fixed annuity
payouts or in a single, lump-sum payment.
You may change the Payout Commencement Date within 60 days prior to commencement
of payouts or your Beneficiary may change it upon the death of the Owner.
If this is an IRA, payouts which satisfy the minimum distribution requirements
of the Internal Revenue Code must begin no later than when you become age 70
1/2.
Periodic Withdrawals
You may request that all or part of the Annuity Account Value be applied to a
periodic withdrawal option. The amount applied to a periodic withdrawal is the
Annuity Account Value with any applicable MVA, less Premium Tax, if any.
In requesting periodic withdrawals, you must elect:
o The withdrawal frequency of either 1-, 3-, 6- or 12-month intervals o A
minimum withdrawal amount of at least $100 o The calendar day of the month on
which withdrawals will be made
o One of the periodic withdrawal payout options discussed below-- you may
change the withdrawal option and/or the frequency once each calendar year
Your withdrawals may be prorated across the Guarantee Period Fund (if
applicable) and the Sub-Accounts in proportion to their assets. Or, they can be
made specifically from the Guarantee Period Fund and specific Sub-Account(s)
until they are depleted. Then, we will automatically prorate the remaining
withdrawals against any remaining Guarantee Period Fund and Sub-Account assets
unless you request otherwise.
While periodic withdrawals are being received:
o You may continue to exercise all contractual rights, except that no
Contributions may be made.
o A Market Value Adjustment, if applicable, will be assessed for periodic
withdrawals from Guarantee Periods six or more months prior to its
Guarantee Period maturity date.
o You may keep the same Sub-Accounts as you had selected before periodic
withdrawals began. o Charges and fees under the Contract continue to apply. o
Maturing Guarantee Periods renew into the shortest Guarantee Period then
available.
Periodic withdrawals will cease on the earlier of the date:
o The amount elected to be paid under the option selected has been
reduced to zero.
o The Annuity Account Value is zero.
o You request that withdrawals stop.
o The Owner or the Annuitant dies.
If periodic withdrawals stop, you may resume making Contributions. However, we
may limit the number of times you may restart a periodic withdrawal program.
Periodic withdrawals made for any purpose may be taxable, subject to withholding
and to the 10% federal penalty tax if you are younger than age 59 1/2. IRAs are
subject to complex rules with respect to restrictions on and taxation of
distributions, including penalty taxes.
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If you choose to receive payouts from your annuity through periodic withdrawals,
you may select from the following payout options: Income for a specified period
(at least 36 months)--You elect the length of time over which withdrawals will
be made. The amount paid will vary based on the duration you choose.
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Income of a specified amount (at least 36 months)--You elect the dollar amount
of the withdrawals. Based on the amount elected, the duration may vary. Interest
only--Your withdrawals will be based on the amount of interest credited to the
Guarantee Period Fund between withdrawals. Available only if 100% of your
Account Value is invested in the Guarantee Period Fund.
Minimum distribution--If you are using this Contract as an IRA, you may request
minimum distributions as specified under Internal Revenue Code Section
401(a)(9). Any other form of periodic withdrawal acceptable to Great-West which
is for a period of at least 36 months.
In accordance with the provisions outlined in this section, you may request a
periodic withdrawal to remit fees paid to your Investment Manager or Financial
Advisor. There may be income tax consequences to any periodic withdrawal made
for this purpose. Please see "Cash Withdrawals" on page 19.
Annuity Payouts
You can choose the date you'd like annuity payouts to start either when you
purchase the Contract or at a later date. The date you choose must be at least
one year after your initial Contribution. If you do not select a payout start
date, payouts will begin on the first day of the month of the Annuitant's 91st
birthday. You can change your selection at any time up to 30 days before the
annuity date you selected.
If you have not elected a payout option within 30 days of the Annuity
Commencement Date, the portion of your Annuity Account Value held in your Fixed
Account will be paid out as a fixed life annuity with a guarantee period of 20
years. The Annuity Account Value held in the Sub-Account(s) will be paid out as
a variable life annuity with a guarantee period of 20 years.
The amount to be paid out is the Annuity Account Value on the Annuity
Commencement Date. The minimum amount that may be withdrawn from the Annuity
Account Value to purchase an annuity payout option is $2,000 with a Market Value
Adjustment, if applicable. If after the Market Value Adjustment, your Annuity
Account Value is less than $2,000, we may pay the amount in a single sum subject
to the Contract provisions applicable to a partial withdrawal.
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If you choose to receive variable annuity payouts from your annuity, you may
select from the following payout options: Variable life annuity with guaranteed
period--This option provides for monthly payouts during a guaranteed period or
for the lifetime of the Annuitant, whichever is longer. The guaranteed period
may be 5, 10, 15 or 20 years. Variable life annuity--This option provides for
monthly payouts during the lifetime of the Annuitant. The annuity terminates
with the last payout due prior to the death of the Annuitant. Since no minimum
number of payouts is guaranteed, this option may offer the maximum level of
monthly payouts. It is possible that only one payout may be made if the
Annuitant died before the date on which the second payout is due.
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Under an annuity payout option, you can receive payouts monthly, quarterly,
semi-annually or annually in payments which must be at least $50. We reserve the
right to make payouts using the most frequent payout interval which produces a
payout of at least $50.
If you elect to receive a single sum payment, the amount paid is the Surrender
Value.
Amount of First Variable Payout
The first payout under a variable annuity payout option will be based on the
value of the amounts held in each Sub-Account you have selected on the 5th
valuation date preceding the Annuity Commencement Date. It will be determined by
applying the appropriate rate to the amount applied under the payout option.
For annuity options involving life income, the actual age and/or gender of the
Annuitant will affect the amount of each payout. We reserve the right to ask for
satisfactory proof of the Annuitant's age. We may delay annuity payouts until
satisfactory proof is received. Since payouts to older Annuitants are expected
to be fewer in number, the amount of each annuity payout under a selected
annuity form will be greater for older Annuitants than for younger Annuitants.
If the age of the Annuitant has been misstated, the payouts established will be
made on the basis of the correct age. If payouts were too large because of
misstatement, the difference with interest may be deducted by us from the next
payout or payouts. If payouts were too small, the difference with interest may
be added by us to the next payout. This interest is at an annual effective rate
which will not be less than the Guaranteed Interest Rate.
Variable Annuity Units
The number of Annuity Units paid for each Sub-Account is determined by dividing
the amount of the first monthly payout by its Annuity Unit value on the 5th
valuation date preceding the date the first payout is due. The number of Annuity
Units used to calculate each payout for a Sub-Account remains fixed during the
Annuity Payout Period.
Amount of Variable Payouts After the
First Payout
Payouts after the first will vary depending upon the investment performance of
the Sub-Accounts. The subsequent amount paid from each Sub-Account is determined
by multiplying (a) by (b) where (a) is the number of Sub-Account Annuity Units
to be paid and (b) is the Sub-Account Annuity Unit value on the 5th valuation
date preceding the date the annuity payout is due. The total amount of each
variable annuity payout will be the sum of the variable annuity payouts for each
Sub-Account you have selected. We guarantee that the dollar amount of each
payout after the first will not be affected by variations in expenses or
mortality experience.
Transfers After the Variable Annuity Commencement Date
Once annuity payouts have begun, no Transfers may be made from a fixed annuity
payout option to a variable annuity payout option, or vice versa. However, for
variable annuity payout options, Transfers may be made within the variable
annuity payout option among the available Sub-Accounts. Transfers after the
Annuity Commencement Date will be made by converting the number of Annuity Units
being Transferred to the number of Annuity Units of the Sub-Account to which the
Transfer is made. The result will be that the next annuity payout, if it were
made at that time, would be the same amount that it would have been without the
Transfer. Thereafter, annuity payouts will reflect changes in the value of the
new Annuity Units.
Other restrictions
Once payouts start under the annuity payout option you select:
o no changes can be made in the payout option,
o no additional Contributions will be accepted under the Contract and
o no further withdrawals, other than withdrawals made to provide annuity
benefits, will be allowed.
A portion or the entire amount of the annuity payouts may be taxable as ordinary
income. If, at the time the annuity payouts begin, we have not received a proper
written election not to have federal income taxes withheld, we must by law
withhold such taxes from the taxable portion of such annuity payouts and remit
that amount to the federal government (an election not to have taxes withheld is
not permitted for certain Qualified Contracts). State income tax withholding may
also apply. Please see "Federal Tax Matters" below for details.
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If you choose to receive fixed annuity payouts from your annuity, you may select
from the following payout options:
Income of specified amount--The amount applied under this option may be paid in
equal annual, semi-annual, quarterly or monthly installments in the dollar
amount elected for not more than 240 months.
Income for a specified period--Payouts are paid annually, semi-annually,
quarterly or monthly, as elected, for a selected number of years not to exceed
240 months. Fixed life annuity with guaranteed period--This option provides
monthly payouts during a guaranteed period or for the lifetime of the Annuitant,
whichever is longer. The guaranteed period may be 5, 10, 15 or 20 years.
Fixed life annuity--This option provides for monthly payouts during the lifetime
of the Annuitant. The annuity ends with the last payout due prior to the death
of the Annuitant. Since no minimum number of payouts is guaranteed, this option
may offer the maximum level of monthly payouts. It is possible that only one
payout may be made if the Annuitant died before the date on which the second
payout is due.
Any other form of a fixed annuity acceptable to us.
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Annuity IRAs
The annuity date and options available for IRAs may be controlled by
endorsements, the plan documents, or applicable law.
Under the Internal Revenue Code, a Contract purchased and used in connection
with an Individual Retirement Account or with certain other plans qualifying for
special federal income tax treatment is subject to complex "minimum
distribution" requirements. Under a minimum distribution plan, distributions
must begin by a specific date and the entire interest of the plan participant
must be distributed within a certain specified period of time. The application
of the minimum distribution requirements vary according to your age and other
circumstances.
Seek Tax Advice
The following discussion of the federal income tax consequences is only a brief
summary and is not intended as tax advice. The federal income tax consequences
discussed here reflect our understanding of current law and the law may change.
Federal estate tax consequences and state and local estate, inheritance, and
other tax consequences of ownership or receipt of distributions under a Contract
depend on your individual circumstances or the circumstances of the person who
receives the distribution. A tax adviser should be consulted for further
information.
- --------------------------------------------------------------------------------
Federal Tax Matters
The following discussion is a general description of federal income tax
considerations relating to the Contracts and is not intended as tax advice. This
discussion assumes that the Contract qualifies as an annuity contract for
federal income tax purposes. This discussion is not intended to address the tax
consequences resulting from all situations. If you are concerned about these tax
implications relating to the ownership or use of the Contract, you should
consult a competent tax adviser before initiating any transaction.
This discussion is based upon our understanding of the present federal income
tax laws as they are currently interpreted by the Internal Revenue Service. No
representation is made as to the likelihood of the continuation of the present
federal income tax laws or of the current interpretation by the Internal Revenue
Service. Moreover, no attempt has been made to consider any applicable state or
other tax laws.
The Contract may be purchased on a non-tax qualified basis ("Non-Qualified
Contract") or purchased and used in connection with IRAs. The ultimate effect of
federal income taxes on the amounts held under a Contract, on annuity payouts,
and on the economic benefit to you, the Annuitant, or the Beneficiary may depend
on the type of Contract, and on the tax status of the individual concerned.
- --------------------------------------------------------------------------------
Because tax laws, rules and regulations are constantly changing, we do not make
any guarantees about the Contract's tax status.
- --------------------------------------------------------------------------------
Certain requirements must be satisfied in purchasing an Annuity IRA and
receiving distributions from an Annuity IRA in order to continue receiving
favorable tax treatment. As a result, purchasers of Annuity IRAs should
seek competent legal and tax advice regarding the suitability of the Contract
for their situation, the applicable requirements and the tax treatment of the
rights and benefits of the Contract. The following discussion assumes that an
Annuity IRA is purchased with proceeds and/or Contributions that qualify for the
intended special federal income tax treatment.
Taxation of Annuities
Section 72 of the Internal Revenue Code governs taxation of annuities. You, as a
"natural person" will not generally be taxed on increases, if any, in the value
of your Annuity Account Value until a distribution occurs by withdrawing all or
part of the Annuity Account Value (for example, withdrawals or annuity payouts
under the annuity payout option elected). However, under certain circumstances,
you currently may be subject to taxation. In addition, an assignment, pledge, or
agreement to assign or pledge any portion of the Annuity Account Value generally
will be treated as a distribution. The taxable portion of a distribution (in the
form of a single sum payout or an annuity) is taxable as ordinary income. An IRA
Contract may not be assigned as collateral.
If the Contract is not owned by a natural person (for example, a corporation or
certain trusts), you generally must include in income any increase in the excess
of the Annuity Account Value over the "investment in the Contract" (discussed
below) during each taxable year. The rule does not apply where the non-natural
person is the stated Owner of a Contract and the beneficial Owner is a natural
person.
The rule also does not apply where:
o The annuity Contract is acquired by the estate of a decedent.
o The Contract is held under an IRA.
o The Contract is a qualified funding asset for a structured settlement.
o The Contract is purchased on behalf of an employee upon termination of a
qualified plan.
The following discussion generally applies to a Contract owned by a natural
person.
Withdrawals
In the case of a withdrawal under an IRA, including withdrawals under the
periodic withdrawal option, a portion of the amount received may be non-taxable.
The amount of the non-taxable portion is generally determined by the ratio of
the "investment in the Contract" to the individual's total accrued benefit under
the plan. The "investment in the Contract" generally equals the amount of any
nondeductible Contributions paid by or on behalf of any individual. Special tax
rules may be available for certain distributions from an IRA.
With respect to Non-Qualified Contracts, partial withdrawals, including periodic
withdrawals, are generally treated as taxable income to the extent that the
Annuity Account Value immediately before the withdrawal exceeds the "investment
in the Contract" at that time. If a partial withdrawal is made from a Guarantee
Period which is subject to a Market Value Adjustment, then the Annuity Account
Value immediately before the withdrawal will not be altered to take into account
the Market Value Adjustment. As a result, for purposes of determining the
taxable portion of the partial withdrawal, the Annuity Account Value will not
reflect the amount, if any, deducted from or added to the Guarantee Period due
to the Market Value Adjustment. Full surrenders are treated as taxable income to
the extent that the amount received exceeds the "investment in the Contract."
The taxable portion of any annuity payout is taxed at ordinary income tax rates.
Annuity Payouts
Although the tax consequences may vary depending on the annuity form elected
under the Contract, in general, only the portion of the annuity payout that
represents the amount by which the Annuity Account Value exceeds the investment
in the Contract will be taxed. After the investment in the Contract is
recovered, the full amount of any additional annuity payouts is taxable. For
fixed annuity payouts, in general there is no tax on the portion of each payout
which represents the same ratio that the investment in the Contract bears to the
total expected value of the annuity payouts for the term of the payouts.
However, the remainder of each annuity payout is taxable. Once the investment in
the Contract has been fully recovered, the full amount of any additional annuity
payouts is taxable.
Penalty Tax
For distributions from a Non-Qualified Contract, there may be a federal income
tax penalty imposed equal to 10% of the amount treated as taxable income. In
general, however, there is no penalty tax on distributions: o Made on or after
the date on which the Owner reaches age 59 1/2.
o Made as a result of death or disability of the Owner.
o Received in substantially equal periodic payouts (at least annually) for
your life expectancy or the joint life expectancies of you and the
Beneficiary.
Other exemptions or tax penalties may apply to distributions from a
Non-Qualified Contract or certain distributions from an IRA. For more details
regarding these exemptions or penalties consult a competent tax adviser.
Taxation of Death Benefit proceeds
Amounts may be distributed from the Contract because of the death of an Owner or
the Annuitant. Generally such amounts are included in the income of the
recipient as follows: o If distributed in a lump sum, they are taxed in the same
manner as a full surrender, as described above. o If distributed under an
annuity form, they are taxed in the same manner as annuity payouts, as described
above.
Distribution at Death
In order to be treated as an annuity contract, the terms of the Contract must
provide the following two distribution rules:
o If the Owner dies before the date annuity payouts start, your entire interest
must generally be distributed within five years after the date of your death. If
payable to a designated Beneficiary, the distributions may be paid over the life
of that designated Beneficiary or over a period not extending beyond the life
expectancy of that Beneficiary, so long as payouts start within one year of your
death. If the sole designated Beneficiary is your spouse, the Contract may be
continued in the name of the spouse as Owner.
o If the Owner dies on or after the date annuity payouts start, and before the
entire interest in the Contract has been distributed, the remainder of your
interest will be distributed on the same or on a more rapid schedule than that
provided for in the method in effect on the date of death.
If the Owner is not an individual, then for purposes of the distribution at
death rules, the Primary Annuitant is considered the Owner. In addition, when
the Owner is not an individual, a change in the Primary Annuitant is treated as
the death of the Owner.
Distributions made to a Beneficiary upon the Owner's death from an IRA must be
made pursuant to the rules in Section 401(a)(9) of the Internal Revenue Code.
Transfers, Assignments or Exchanges
A transfer of ownership of a Contract, the designation of an Annuitant, Payee or
other Beneficiary who is not also the Owner, or the exchange of a Contract may
result in adverse tax consequences that are not discussed in this Prospectus.
Multiple Contracts
All deferred, Non-Qualified Annuity Contracts that are issued by Great-West (or
our affiliates) to the same Owner during any calendar year will be treated as
one annuity contract for purposes of determining the taxable amount.
Withholding
Annuity distributions generally are subject to withholding at rates that vary
according to the type of distribution and the recipient's tax status.
Recipients, however, generally are provided the opportunity to elect not to have
tax withheld from distributions. Certain distributions from IRAs are subject to
mandatory federal income tax withholding.
Section 1035 Exchanges
Internal Revenue Code Section 1035 provides that no gain or loss shall be
recognized on the exchange of one insurance contract for another. Generally,
contracts issued in an exchange for another annuity contract are treated as new
for purposes of the penalty and distribution at death rules.
Individual Retirement Annuities
The Contract may be used with IRAs as described in Section 408 of the Internal
Revenue Code which permits eligible individuals to contribute to an individual
retirement program known as an Individual Retirement Annuity. Also, certain
kinds of distributions from certain types of qualified and non-qualified
retirement plans may be "rolled over" following the rules set out in the
Internal Revenue Code. If you purchase this Contract for use with an IRA, you
will be provided with supplemental information. And, you have the right to
revoke your purchase within seven days of purchase of the IRA Contract.
If a Contract is purchased to fund an IRA, the Annuitant must also be the Owner.
In addition, if a Contract is purchased to fund an IRA, minimum distributions
must commence not later than April 1st of the calendar year following the
calendar year in which you attain age 70 1/2. You should consult your tax
adviser concerning these matters.
Various tax penalties may apply to Contributions in excess of specified limits,
distributions that do not satisfy specified requirements, and certain other
transactions. The Contract will be amended as necessary to conform to the
requirements of the Internal Revenue Code if there is a change in the law.
Purchasers should seek competent advice as to the suitability of the Contract
for use with IRAs.
When you make your initial Contribution, you must specify whether you are
purchasing a Non-Qualified Contract or an IRA. If the initial Contribution is
made as a result of an exchange or surrender of another annuity contract, we may
require that you provide information with regard to the federal income tax
status of the previous annuity contract.
We will require that you purchase separate Contracts if you want to invest money
qualifying for different annuity tax treatment under the Internal Revenue Code.
For each separate Contract you will need to make the required minimum initial
Contribution. Additional Contributions under the Contract must qualify for the
same federal income tax treatment as the initial Contribution under the
Contract. We will not accept an additional Contribution under a Contract if the
federal income tax treatment of the Contribution would be different from the
initial Contribution.
If a Contract is issued in connection with an employer's Simplified Employee
Pension plan, Owners, Annuitants and Beneficiaries are cautioned that the rights
of any person to any of the benefits under the Contract will be subject to the
terms and conditions of the plan itself, regardless of the terms and conditions
of the Contract.
- --------------------------------------------------------------------------------
Assignments or Pledges
Generally, rights in the Contract may be assigned or pledged for loans at any
time during the life of the Annuitant. However, if the Contract is an IRA, you
may not assign the Contract as collateral.
If a non-IRA Contract is assigned, the interest of the assignee has priority
over your interest and the interest of the Beneficiary. Any amount payable to
the assignee will be paid in a single sum.
A copy of any assignment must be submitted to the Annuity Administration
Department at Great-West. All assignments are subject to any action taken or
payout made by Great-West before the assignment was processed. We are not
responsible for the validity or sufficiency of any assignment.
If any portion of the Annuity Account Value is assigned or pledged for a loan,
it may be treated as a distribution. Please consult a competent tax adviser for
further information.
- --------------------------------------------------------------------------------
Performance Data
From time to time, we may advertise yields and average annual total returns for
the Sub-Accounts. In addition, we may advertise the effective yield of the
Schwab Money Market Sub-Account. These figures will be based on historical
information and are not intended to indicate future performance.
Money Market Yield
The yield of the Schwab Money Market Sub-Account refers to the annualized income
generated by an investment in that Sub-Account over a specified 7-day period. It
is calculated by assuming that the income generated for that seven-day period is
generated each 7-day period over a period of 52 weeks and is shown as a
percentage of the investment.
The effective yield is calculated similarly but, when annualized, the income
earned by an investment in that Sub-Account is assumed to be reinvested. The
effective yield will be slightly higher than the yield because of the
compounding effect of the assumed reinvestment.
Average Annual Total Return
The table on the following page illustrates standardized and non-standardized
average annual total return for one-, three-, five- and ten-year periods (or
since inception, if less than ten years) ended December 31, 1999. Average annual
total return quotations represent the average annual compounded rate of return
that would equate an initial investment of $1,000 to the redemption value of
that investment (excluding Premium Taxes, if any) as of the last day of each of
the periods for which total return quotations are provided.
Both the standardized and non-standardized data reflect the deduction of all
fees and charges under the Contract. The standardized data is calculated from
the inception date of the Sub-Account and the non-standardized data is
calculated for periods preceding the inception date of the Sub-Account. Some of
the Sub-Accounts do not have standardized performance information. For
additional information regarding yields and total returns calculated using the
standard methodologies briefly described herein, please refer to the Statement
of Additional Information.
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
Performance Data
Sub-Account 1 year 3 years 5 years 10 years Since Inception Date Since Inception Inception Date
Inception of Sub-Account of Underlying of Underlying
of Sub-Account Portfolio Portfolio
(if less
than 10)
Alger American Growth 11/1/96 1/9/89
American Century VP International 11/1/96 5/1/94
BT Insurance Funds Trust EAFE Equity Index 5/3/99 8/22/97
BT Insurance Funds Trust Small Cap Index 5/3/99 8/25/97
Baron Capital Asset 5/3/99 10/1/98
Berger IPT-Small Company Growth 5/1/97 5/1/96
Dreyfus Variable Investment Capital Appreciation 5/3/99 4/5/93
Dreyfus Variable Investment Growth and Income 5/3/99 5/2/94
Federated American Leaders II 11/1/96 2/1/94
Federated U.S. Government Securities II 11/1/96 3/29/94
Federated Utility II TO BE COMPLETED BY AMENDMENT 5/1/97 4/14/94
INVESCO VIF-High Yield 11/1/96 5/27/94
INVESCO VIF-Equity Income 11/1/96 8/10/94
Janus Aspen Growth 11/1/96 9/13/93
Janus Aspen Worldwide Growth 11/1/96 9/13/93
Janus Aspen Flexible Income 5/3/99 9/13/93
Janus Aspen International Growth 5/3/99 5/2/94
Montgomery Variable Series: Growth 11/1/96 2/9/96
Prudential Series Fund Equity 5/3/99 5/3/99
SAFECO RST Equity 4/30/97 4/3/87
SAFECO RST Growth 5/3/99 1/7/93
Schwab MarketTrack Growth II 11/1/96 11/1/96
Schwab S&P 500 11/1/96 11/1/96
Scudder Variable Life Investment Fund: Capital 5/3/99 7/16/85
Growth
Scudder Variable Life Investment Fund: Growth 5/3/99 5/2/94
and Income
Strong Schafer Value II 5/3/99 10/22/85
Van Kampen LIT-Morgan Stanley Real Estate 9/15/97 7/3/95
Securities
</TABLE>
Performance information and calculations for any Sub-Account are based only on
the performance of a hypothetical Contract under which the Annuity Account Value
is allocated to a Sub-Account during a particular time period. Performance
information should be considered in light of the investment objectives and
policies and characteristics of the Portfolios in which the Sub-Account invests
and the market conditions during the given time period. It should not be
considered as a representation of what may be achieved in the future.
Reports and promotional literature may also contain other information including:
o the ranking of or asset allocation/investment strategy of any Sub-Account
derived from rankings of variable annuity separate accounts or their
investment products tracked by Lipper Analytical Services, Inc., VARDS,
Morningstar, Value Line, IBC/Donoghue's Money Fund Report, Financial
Planning Magazine, Money Magazine, Bank Rate Monitor, Standard & Poor's
Indices, Dow Jones Industrial Average, and other rating services,
companies, publications or other people who rank separate accounts or other
investment products on overall performance or other criteria, and
o the effect of tax-deferred compounding on investment returns, or returns in
general, which may be illustrated by graphs, charts, or otherwise, and
which may include a comparison, at various points in time, of the return
from an investment in a Contract (or returns in general) on a tax-deferred
basis (assuming one or more tax rates) with the return on a currently
taxable basis. Other ranking services and indices may be used.
We may from time to time also advertise cumulative (non-annualized) total
returns, yield and standard total returns for the Sub-Accounts.
We may also advertise performance figures for the Sub-Accounts based on the
performance of a Portfolio prior to the time the Series Account commenced
operations.
For additional information regarding the calculation of other performance data,
please refer to the Statement of Additional Information.
- --------------------------------------------------------------------------------
Distribution of the Contracts
Charles Schwab & Co., Inc. (Schwab) is the principal underwriter and distributor
of the Contracts. Schwab is registered with the Securities and Exchange
Commission as a broker/dealer and is a member of the National Association of
Securities Dealers, Inc. (NASD). Its principal offices are located at 101
Montgomery, San Francisco, California 94104, telephone 800-838-0650.
Certain administrative services are provided by Schwab to assist Great-West in
processing the Contracts. These services are described in written agreements
between Schwab and Great-West. Great-West has agreed to indemnify Schwab (and
its agents, employees, and controlling persons) for certain damages arising out
of the sale of the Contracts, including those arising under the securities laws.
- --------------------------------------------------------------------------------
Voting Rights
In general, you do not have a direct right to vote the Portfolio shares held in
the Series Account. However, under current law, you are entitled to give us
instructions on how to vote the shares. We will vote the shares according to
those instructions at regular and special shareholder meetings. If the law
changes and we can vote the shares in our own right, we may elect to do so.
Before the Annuity Commencement Date, you have the voting interest. The number
of votes available to you will be calculated separately for each of your
Sub-Accounts. That number will be determined by applying your percentage
interest, if any, in a particular Sub-Account to the total number of votes
attributable to that Sub-Account. You hold a voting interest in each Sub-Account
to which your Annuity Account Value is allocated. If you select a variable
annuity option, the votes attributable to your Contract will decrease as annuity
payouts are made.
The number of votes of a Portfolio will be determined as of the date established
by that Portfolio for determining shareholders eligible to vote at the meeting
of the Portfolios. Voting instructions will be solicited by written
communication prior to such meeting in accordance with procedures established by
the respective Portfolios.
If we do not receive timely instructions and Owners have no beneficial interest
in shares held by us, we will vote according to the voting instructions as a
proportion of all Contracts participating in the Sub-Account. If you indicate in
your instructions that you do not wish to vote an item, we will apply your
instructions on a pro rata basis to reduce the votes eligible to be cast.
Each person or entity having a voting interest in a Sub-Account will receive
proxy material, reports and other material relating to the appropriate
Portfolio.
Please note, generally the Portfolios are not required to, and do not intend to,
hold annual or other regular meetings of shareholders.
Contract Owners have no voting rights in Great-West.
- --------------------------------------------------------------------------------
Rights Reserved by Great-West
We reserve the right to make certain changes we feel would best serve the
interests of Owners and Annuitants or would be appropriate in carrying out the
purposes of the 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. Approval may not be required in all cases, however. Examples of the
changes we may make include: o To operate the Series Account in any form
permitted under the Investment Company Act of 1940 or in any other form
permitted by law.
o To Transfer any assets in any Sub-Account to another Sub-Account, or to one
or more separate accounts, or to a Guarantee Period; or to add, combine or
remove Sub-Accounts of the Series Account.
o To substitute, for the Portfolio shares in any Sub-Account, the shares of
another Portfolio or shares of another investment company or any other
investment permitted by law.
o To make any changes required by the Internal Revenue Code or by any other
applicable law in order to continue treatment of the Contract as an
annuity.
o To change the time or time of day at which a valuation date is deemed to
have ended.
o To make any other necessary technical changes in the Contract in order to
conform with any action the above provisions permit us to take, including
changing the way we assess charges, without increasing them for any
outstanding Contract beyond the aggregate amount guaranteed.
- --------------------------------------------------------------------------------
Legal Proceedings
Currently, the Series Account is not a party to, and its assets are not subject
to any material legal proceedings. And, Great-West is not currently a party to,
and its property is not currently subject to, any material legal proceedings.
The lawsuits to which Great-West is a party are, in the opinion of management,
in the ordinary course of business, and are not expected to have a material
adverse effect on the financial results, conditions or prospects of Great-West.
- --------------------------------------------------------------------------------
Legal Matters
Advice regarding certain legal matters concerning the federal securities laws
applicable to the issue and sale of the Contract has been provided by Jorden
Burt Boros Cicchetti Berenson & Johnson LLP.
- --------------------------------------------------------------------------------
Experts
The consolidated financial statements and consolidated financial statement
schedules of Great-West Life & Annuity Insurance Company as of December 31, 1998
and 1999, and for each of the three years in the period ended December 31, 1999,
that are incorporated by reference in this Prospectus, have been audited by
Deloitte & Touche LLP, independent auditors, as stated in their report in the
statements. We have incorporated our financial statements in reliance upon the
reports of Deloitte & Touche LLP given upon their authority as experts in
accounting and auditing. Other financial statements incorporated by reference
into this Prospectus are unaudited.
- --------------------------------------------------------------------------------
Incorporation of Certain Documents by Reference and Available Information
Great-West's Annual Report on Form 10-K for the year ended December 31, 1999 is
incorporated herein by reference, which means that it is legally a part of this
Prospectus. All documents or reports filed by Great-West under Section 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934 (the "Exchange Act")
after the effective date of this Prospectus are also incorporated by reference.
Such documents or reports will be part of this Prospectus from the date such
documents are filed.
Great-West files its Exchange Act documents and reports, including its annual
and quarterly annual reports on Form 10-K and Form 10-Q, electronically pursuant
to EDGAR under CIK No. 0000744455.
We have filed a registration statement ("Registration Statement") with the
Commission under the 1933 Act relating to the Contracts offered by this
Prospectus. This Prospectus has been filed as a part of the Registration
Statement and does not contain all of the information contained in the
Registration Statement and its exhibits. Please refer to the registration
statement and its exhibits for further information.
You may request a free copy of any or all of the information incorporated by
reference into the Prospectus (other than exhibits not specifically incorporated
by reference into the text of such documents). Please direct any oral or written
request for such documents to:
Annuity Administration Department
P. O. Box 173920
Denver, Colorado 80217-3920
1-800-838-0650
The SEC maintains an Internet web site (http://www.sec.gov) that contains the
Statement of Additional Information, information incorporated by reference and
other information filed electronically by Great-West concerning the Contract and
the Series Account.
You also can review and copy any materials filed with the SEC at its Public
Reference Room at 450 Fifth Street, N.W., Washington, D.C. 20549. You may obtain
information on the operation of the Public Reference room by calling the SEC at
1-800-SEC-0330.
- --------------------------------------------------------------------------------
Appendix A--Condensed Financial Information
TO BE COMPLETED BY AMENDMENT
- --------------------------------------------------------------------------------
Appendix B--Market Value Adjustments
The amount available for a full surrender, partial withdrawal or Transfer equals
the amount requested plus the Market Value Adjustment (MVA). The MVA is
calculated by multiplying the amount requested by the Market Value Adjustment
Factor (MVAF).
The MVA formula
The MVA is determined using the following formula:
MVA = (amount applied) X (Market Value Adjustment Factor) The Market Value
Adjustment Factor is:
{[(1 + i)/(1 + j +.10%)] N/12} - 1
Where:
o i is the U.S. Treasury Strip ask side yield as published in the Wall Street
Journal on the last business day of the week prior to the date the stated
rate of interest was established for the Guarantee Period. The term of i is
measured in years and equals the term of the Guarantee Period.
o j is the U.S. Treasury Strip ask side yield as published in the Wall Street
Journal on the last business day of the week prior to the week the
Guarantee Period is broken. The term of j equals the remaining term to
maturity of the Guarantee Period, rounded up to the higher number of years.
o N is the number of complete months remaining until maturity.
The MVA will equal 0 if:
o i and j differ by less than .10%
o N is less than 6
Examples
Following are four examples of Market Value Adjustments illustrating (1)
increasing interest rates, (2) decreasing interest rates, (3) flat interest
rates (i and j are within .10% of each other), and (4) less than 6 months to
maturity.
Example 1--Increasing Interest Rates
- ------------------------------- -------------------------------
- ------------------------------ $25,000 on November 1, 1996
Deposit
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
Maturity date December 31, 2005
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
Interest Guarantee Period 10 years
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
i assumed to be 6.15%
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
Surrender date July 1, 2000
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
j 7.00%
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
Amount surrendered $10,000
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
N 65
- ------------------------------- -------------------------------
MVAF = {[(1 + i)/(1 + j + .10%)]N/12} - 1
= {[1.0615/1.071]65/12} - 1
= .952885 - 1
= -.047115
MVA = (amount transferred or surrendered) x MVAF = $10,000 x - .047115 = -
$471.15
Surrender Value = (amount transferred or surrendered + MVA)
= ($10,000 + - $471.15)
= $9,528.85
Example 2--Decreasing Interest Rates
- ------------------------------- -------------------------------
Deposit $25,000 on November 1, 1996
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
Maturity date December 31, 2005
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
Interest Guarantee Period 10 years
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
i assumed to be 6.15%
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
Surrender date July 1, 2000
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
j 5.00%
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
Amount surrendered $10,000
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
N 65
- ------------------------------- -------------------------------
MVAF = {[(1 + i)/(1 + j + .10%)]N/12} - 1
= {[1.0615/1.051]65/12} - 1
= .055323
MVA = (amount transferred or surrendered) x MVAF
= $10,000 x .0055323
= $553.23
Surrender Value = (amount transferred or surrendered + MVA)
= ($10,000 + $553.23)
= $10,553.23
Example 3--Flat Interest Rates (i and j are within .10% of each other)
- ------------------------------- -------------------------------
Deposit $25,000 on November 1, 1996
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
Maturity date December 31, 2005
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
Interest Guarantee Period 10 years
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
i assumed to be 6.15%
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
Surrender date July 1, 2000
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
j 6.24%
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
Amount surrendered $10,000
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
N 65
- ------------------------------- -------------------------------
MVAF = {[(1 + i)/(1 + j + .10%)]N/12} - 1
= {[1.0615/1.0634]65/12} - 1
= .99036 - 1
= -.00964
However, [i-j] <.10%, so MVAF = 0
MVA = (amount transferred or surrendered) x MVAF
= $10,000 x 0
= $0
Surrender Value = (amount transferred or surrendered + MVA)
= ($10,000 + $0)
= $10,000
Example 4--N equals less than 6 months to maturity
- ------------------------------- -------------------------------
Deposit $25,000 on November 1, 1996
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
Maturity date December 31, 2005
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
Interest Guarantee Period 10 years
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
i assumed to be 6.15%
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
Surrender date July 1, 2005
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
j 7.00%
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
Amount surrendered $10,000
- ------------------------------- -------------------------------
- ------------------------------- -------------------------------
N 5
- ------------------------------- -------------------------------
MVAF = {[(1 + i)/(1 + j + .10%)]N/12} - 1
= {[1.0615/1.071]5/12} - 1
= .99629 - 1
= -.00371
However, N<6, so MVAF = 0
MVA = (amount transferred or surrendered) x MVAF
= $10,000 x 0
= $0
Surrender Value = (amount transferred or surrendered + MVA)
= ($10,000 + $0)
= $10,000
- --------------------------------------------------------------------------------
Appendix C--Net Investment Factor
The Net Investment Factor is determined by dividing (a) by (b), and subtracting
(c) from the result where:
(a) is the net result of:
1) the net asset value per share of the Portfolio shares determined as of the
end of the current Valuation Period, plus
2) the per share amount of any dividend (or, if applicable, capital gain
distributions) made by the Portfolio on shares if the "ex-dividend" date occurs
during the current Valuation Period, minus or plus
3) a per unit charge or credit for any taxes incurred by or provided for in the
Sub-Account, which is determined by GWL&A to have resulted from the investment
operations of the Sub-Account, and
(b) is the net asset value per share of the Portfolio shares determined as of
the end of the immediately preceding Valuation Period, and
(c) is an amount representing the Mortality and Expense Risk Charge deducted
from each Sub-Account on a daily basis. Such amount is equal to 0.85%.
The Net Investment Factor may be greater than, less than, or equal to one.
Therefore, the Accumulation Unit Value may increase, decrease or remain
unchanged.
The net asset value per share referred to in paragraphs (a)(1) and (b) above,
reflect the investment performance of the Portfolio as well as the payment of
Portfolio expenses.
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
-------------------------------------------
The estimated expenses of the issuance and distribution of the
Contracts, other than commissions on sales of the Contracts are as follows:
<TABLE>
<S> <C>
Securities and Exchange Commission fee $ 68,965.52*
----------
Accounting fees and expenses $ 5,000.00
---------
Legal fees and expenses $ 10,000.00
---------
</TABLE>
* This amount represents the total registration fee paid on February 13, 1996
for the Form S-1 Registration Statement filed on February 26, 1996. Registrant
hereby carries over the amount of this registration fee representing the maximum
aggregate offering price of $195,857,000 registered under this Form S-3
Registration Statement.
Item 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
-----------------------------------------
Provisions exist under the Colorado Business Corporation Act and the
Bylaws of GWL&A whereby GWL&A may indemnify a director, officer, or controlling
person of GWL&A against liabilities arising under the Securities Act of 1933.
The following excerpts contain the substance of these provisions:
Colorado Business Corporation Act
Article 109 - INDEMNIFICATION
Section 7-109-101. Definitions.
As used in this Article:
(1) "Corporation" includes any domestic or foreign entity that is a
predecessor of the corporation by reason of a merger, consolidation, or
other transaction in which the predecessor's existence ceased upon
consummation of the transaction.
(2) "Director" means an individual who is or was a director of a
corporation or an individual who, while a director of a corporation, is
or was serving at the corporation's request as a director, officer,
partner, trustee, employee, fiduciary or agent of another domestic or
foreign corporation or other person or employee benefit plan. A
director is considered to be serving an employee benefit plan at the
corporation's request if his or her duties to the corporation also
impose duties on or otherwise involve services by, the director to the
plan or to participants in or beneficiaries of the plan.
(3) "Expenses" includes counsel fees.
(4) "Liability" means the obligation incurred with respect to a
proceeding to pay a judgment, settlement, penalty, fine, including an
excise tax assessed with respect to an employee benefit plan, or
reasonable expenses.
(5) "Official capacity" means, when used with respect to a director,
the office of director in the corporation and, when used with respect
to a person other than a director as contemplated in Section 7-109-107,
means the office in the corporation held by the officer or the
employment, fiduciary, or agency relationship undertaken by the
employee, fiduciary, or agent on behalf of the corporation. "Official
capacity" does not include service for any other domestic or foreign
corporation or other person or employee benefit plan.
(6) "Party" includes a person who was, is, or is threatened to be made
a named defendant or respondent in a proceeding.
(7) "Proceeding" means any threatened, pending, or completed action,
suit, or proceeding, whether civil, criminal, administrative, or
investigative and whether formal or informal.
Section 7-109-102. Authority to indemnify directors.
(1) Except as provided in subsection (4) of this section, a corporation
may indemnify a person made a party to the proceeding because the
person is or was a director against liability incurred in any
proceeding if:
(a) The person conducted himself or herself in good faith;
(b) The person reasonably believed:
(I) In the case of conduct in an official
capacity with the corporation, that his or her
conduct was in the corporation's best interests; or
(II) In all other cases, that his or her conduct
was at least not opposed to the corporation's best
interests; and
(c) In the case of any criminal proceeding, the person
had no reasonable cause to believe his or her conduct was
unlawful.
(2) A director's conduct with respect to an employee benefit plan for a
purpose the director reasonably believed to be in the interests of the
participants in or beneficiaries of the plan is conduct that satisfies
the requirements of subparagraph (II) of paragraph (b) of subsection
(1) of this section. A director's conduct with respect to an employee
benefit plan for a purpose that the director did not reasonably believe
to be in the interests of the participants in or beneficiaries of the
plan shall be deemed not to satisfy the requirements of subparagraph
(a) of subsection (1) of this section.
(3) The termination of any proceeding by judgment, order, settlement,
or conviction, or upon a plea of nolo contendere or its equivalent, is
not, of itself, determinative that the director did not meet the
standard of conduct described in this section.
(4) A corporation may not indemnify a director under this section:
(a) In connection with a proceeding by or in the right
of the corporation in which the director was adjudged
liable to the corporation; or
(b) In connection with any proceeding charging that the
director derived an improper personal benefit, whether or not
involving action in his official capacity, in which proceeding
the director was adjudged liable on the basis that he or she
derived an improper personal benefit.
(5) Indemnification permitted under this section in connection with a
proceeding by or in the right of a corporation is limited to reasonable
expenses incurred in connection with the proceeding.
Section 7-109-103. Mandatory Indemnification of Directors.
Unless limited by the articles of incorporation, a corporation shall be
required to indemnify a person who is or was a director of the corporation and
who was wholly successful, on the merits or otherwise, in defense of any
proceeding to which he was a party, against reasonable expenses incurred by him
in connection with the proceeding.
Section 7-109-104. Advance of Expenses to Directors.
(1) A corporation may pay for or reimburse the reasonable expenses
incurred by a director who is a party to a proceeding in advance of the
final disposition of the proceeding if:
(a) The director furnishes the corporation a written
affirmation of his good-faith belief that he has met the
standard of conduct described in Section 7-109-102;
(b) The director furnishes the corporation a written
undertaking, executed personally or on the director's behalf,
to repay the advance if it is ultimately determined that he or
she did not meet such standard of conduct; and
(c) A determination is made that the facts then known to those
making the determination would not preclude indemnification
under this article.
(2) The undertaking required by paragraph (b) of subsection (1) of this
section shall be an unlimited general obligation of the director, but
need not be secured and may be accepted without reference to financial
ability to make repayment.
(3) Determinations and authorizations of payments under this section
shall be made in the manner specified in Section 7-109-106.
Section 7-109-105. Court-Ordered Indemnification of Directors.
(1) Unless otherwise provided in the articles of incorporation, a
director who is or was a party to a proceeding may apply for
indemnification to the court conducting the proceeding or to another
court of competent jurisdiction. On receipt of an application, the
court, after giving any notice the court considers necessary, may order
indemnification in the following manner:
(a) If it determines the director is entitled to mandatory
indemnification under section 7-109-103, the court shall order
indemnification, in which case the court shall also order the
corporation to pay the director's reasonable expenses incurred
to obtain court-ordered indemnification.
(b) If it determines that the director is fairly and
reasonably entitled to indemnification in view of all the
relevant circumstances, whether or not the director met the
standard of conduct set forth in section 7-109-102 (1) or was
adjudged liable in the circumstances described in Section
7-109-102 (4), the court may order such indemnification as the
court deems proper; except that the indemnification with
respect to any proceeding in which liability shall have been
adjudged in the circumstances described Section 7-109-102 (4)
is limited to reasonable expenses incurred in connection with
the proceeding and reasonable expenses incurred to obtain
court-ordered indemnification.
Section 7-109-106. Determination and Authorization of Indemnification of
Directors.
(1) A corporation may not indemnify a director under Section 7-109-102
unless authorized in the specific case after a determination has been
made that indemnification of the director is permissible in the
circumstances because he has met the standard of conduct set forth in
Section 7-109-102. A corporation shall not advance expenses to a
director under Section 7-109-104 unless authorized in the specific case
after the written affirmation and undertaking required by Section
7-109-104(1)(a) and (1)(b) are received and the determination required
by Section 7-109-104(1)(c) has been made.
(2) The determinations required to be made under subsection (1) of
this section shall be made:
(a) By the board of directors by a majority vote of those
present at a meeting at which a quorum is present, and only
those directors not parties to the proceeding shall be counted
in satisfying the quorum.
(b) If a quorum cannot be obtained, by a majority vote of a
committee of the board of directors designated by the board of
directors, which committee shall consist of two or more
directors not parties to the proceeding; except that directors
who are parties to the proceeding may participate in the
designation of directors for the committee.
(3) If a quorum cannot be obtained as contemplated in paragraph (a) of
subsection (2) of this section, and the committee cannot be established
under paragraph (b) of subsection (2) of this section, or even if a
quorum is obtained or a committee designated, if a majority of the
directors constituting such quorum or such committee so directs, the
determination required to be made by subsection (1) of this section
shall be made:
(a) By independent legal counsel selected by a vote of the
board of directors or the committee in the manner specified in
paragraph (a) or (b) of subsection (2) of this section or, if
a quorum of the full board cannot be obtained and a committee
cannot be established, by independent legal counsel selected
by a majority vote of the full board of directors; or
(b) By the shareholders.
(4) Authorization of indemnification and evaluation as to
reasonableness of expenses shall be made in the same manner as the
determination that indemnification is permissible; except that, if the
determination that indemnification is permissible is made by
independent legal counsel, authorization of indemnification and advance
of expenses shall be made by the body that selected such counsel.
Section 7-109-107. Indemnification of Officers, Employees, Fiduciaries, and
Agents.
(1) Unless otherwise provided in the articles of incorporation:
(a) An officer is entitled to mandatory indemnification under
section 7-109-103, and is entitled to apply for court-ordered
indemnification under section 7-109-105, in each case to the
same extent as a director;
(b) A corporation may indemnify and advance expenses to an
officer, employee, fiduciary, or agent of the corporation to
the same extent as a director; and
(c) A corporation may indemnify and advance expenses to an
officer, employee, fiduciary, or agent who is not a director
to a greater extent, if not inconsistent with public policy,
and if provided for by its bylaws, general or specific action
of its board of directors or shareholders, or contract.
Section 7-109-108. Insurance.
A corporation may purchase and maintain insurance on behalf of a person
who is or was a director, officer, employee, fiduciary, or agent of the
corporation and who, while a director, officer, employee, fiduciary, or agent of
the corporation, is or was serving at the request of the corporation as a
director, officer, partner, trustee, employee, fiduciary, or agent of any other
domestic or foreign corporation or other person or of an employee benefit plan
against any liability asserted against or incurred by the person in that
capacity or arising out of his or her status as a director, officer, employee,
fiduciary, or agent whether or not the corporation would have the power to
indemnify the person against such liability under the Section 7-109-102,
7-109-103 or 7-109-107. Any such insurance may be procured from any insurance
company designated by the board of directors, whether such insurance company is
formed under the laws of this state or any other jurisdiction of the United
States or elsewhere, including any insurance company in which the corporation
has an equity or any other interest through stock ownership or otherwise.
Section 7-109-109. Limitation of Indemnification of Directors.
(1) A provision concerning a corporation's indemnification of, or
advance of expenses to, directors that is contained in its articles of
incorporation or bylaws, in a resolution of its shareholders or board
of directors, or in a contract, except for an insurance policy or
otherwise, is valid only to the extent the provision is not
inconsistent with Sections 7-109-101 to 7-109-108. If the articles of
incorporation limit indemnification or advance of expenses,
indemnification or advance of expenses are valid only to the extent not
inconsistent with the articles of incorporation.
(2) Sections 7-109-101 to 7-109-108 do not limit a corporation's power
to pay or reimburse expenses incurred by a director in connection with
an appearance as a witness in a proceeding at a time when he or she has
not been made a named defendant or respondent in the proceeding.
Section 7-109-110. Notice to Shareholders of Indemnification of Director.
If a corporation indemnifies or advances expenses to a director under
this article in connection with a proceeding by or in the right of the
corporation, the corporation shall give written notice of the indemnification or
advance to the shareholders with or before the notice of the next shareholders'
meeting. If the next shareholder action is taken without a meeting at the
instigation of the board of directors, such notice shall be given to the
shareholders at or before the time the first shareholder signs a writing
consenting to such action.
Bylaws of GWL&A
Article II, Section 11. Indemnification of Directors.
----------------------------
The Company may, by resolution of the Board of Directors, indemnify and
save harmless out of the funds of the Company to the extent permitted by
applicable law, any director, officer, or employee of the Company or any member
or officer of any committee, and his heirs, executors and administrators, from
and against all claims, liabilities, costs, charges and expenses whatsoever that
any such director, officer, employee or any such member or officer sustains or
incurs in or about any action, suit, or proceeding that is brought, commenced,
or prosecuted against him for or in respect of any act, deed, matter or thing
whatsoever made, done, or permitted by him in or about the execution of his
duties of his office or employment with the Company, in or about the execution
of his duties as a director or officer of another company which he so serves at
the request and on behalf of the Company, or in or about the execution of his
duties as a member or officer of any such Committee, and all other claims,
liabilities, costs, charges and expenses that he sustains or incurs, in or about
or in relation to any such duties or the affairs of the Company, the affairs of
such Committee, except such claims, liabilities, costs, charges or expenses as
are occasioned by his own wilful neglect or default. The Company may, by
resolution of the Board of Directors, indemnify and save harmless out of the
funds of the Company to the extent permitted by applicable law, any director,
officer, or employee of any subsidiary corporation of the Company on the same
basis, and within the same constraints as, described in the preceding sentence.
Item 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
------------------------------------------
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
1. Form of Principal Underwriter and Distribution Agreement is
incorporated by reference to Registrant's Pre-Effective
Amendment no. 2 to Registrant's Registration Statement on Form
S-1 (File No. 333-01173).
2. Not applicable.
3. Not applicable.
4. (a) Form of Combination Fixed and Variable Group Annuity Contract is incorporated by reference to
Registrant's Pre-Effective Amendment No. 1 to the Registration Statement on Form S-1 (File No. 333-01173).
(b) Form of IRA Endorsement is incorporated by reference to Registrant's Pre-Effective Amendment
No. 1 to the Registration Statement on Form S-1 (File No. 333-01173).
5. Opinion and consent of Ruth B. Lurie, Vice President, Counsel and Associate Secretary as to the
legality of the securities being registered, is filed herewith
6. Not applicable.
7. Not applicable.
8. Not applicable.
9. Not applicable.
10. Not applicable.
11. Not applicable.
12. Not applicable.
13. Not applicable.
14. Not applicable.
15. Not applicable.
16. Not applicable.
17. Not applicable.
18. Not applicable.
19. Not applicable.
20. Not applicable.
21. Not applicable.
22. Not applicable.
23. (a) Consent of Jorden Burt Boros Cicchetti Berenson & Johnson LLP to be filed by amendment.
(b) Consent of Deloitte & Touche LLP to be filed by amendment.
24. Power of Attorney for Messrs. Balog, Burns, Dackow, A. Desmarais, P. Desmarais, Jr., Graham, Gratton,
Hart, Kavanagh, Mackness, Nickerson, Pitfield, Plessis-Belair and Walsh are filed herewith as Exhibit 24.
25. Not applicable.
26. Not applicable.
</TABLE>
Item 17. UNDERTAKINGS
A. The Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the
most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the registration
statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the
registration statement or any material change to such
information in the registration statement; provided, however,
that paragraphs (1)(i) and (1) (ii) do not apply if the
information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports
filed by the Registrant pursuant to Section 13 or Section
15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
B. The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each
filing of the Registrant's annual report pursuant to Section 13(a)
or Section 15(d) of the Securities Exchange Act of 1934 that is
incorporated by reference in the Registration Statement shall be
deemed to be a new Registration Statement relating to the securities
offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
C. Insofar as indemnification for liability arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing
provisions, or otherwise, the registrant has been advised that in the
opinion of the Securities and Exchange Commission such indemnification
is against public policy as expressed in the Act and is, therefore,
unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the
registrant in the successful defense of any action, suit or proceeding)
is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will,
unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final
adjudication of such issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement on Form S-3 to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Englewood, State of Colorado, on this 28th day
of January, 2000.
GREAT-WEST LIFE & ANNUITY
INSURANCE COMPANY
By: /s/ William T. McCallum
William T. McCallum, President
and Chief Executive Officer
As required by the Securities Act of 1933, this Registration Statement
has been signed by the following persons in the capacities with Great-West Life
& Annuity Insurance Company and on the dates indicated:
Signature and Title Date
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
/s/ Robert Gratton* 1/28 , 2000
- ------------------------------------------ ------
Director, Chairman of the
Board (Robert Gratton)
/s/ William T. McCallum 1/28 , 2000
- --------------------------------------- ------
Director, President and Chief Executive
Officer (William T. McCallum)
/s/ M.T.G. Graye 1/28 , 2000
- -------------------------------------------- ------
Executive Vice President and Chief
Financial Officer (M.T.G. Graye)
<PAGE>
Signature and Title Date
/s/ James Balog* 1/28, 2000
- ------------------------------------- -----
Director, (James Balog)
, 2000
- ------------------------------------- -----
Director, (James W. Burns)
/s/ Orest T. Dackow* 1/28, 2000
- -------------------------------------- -----
Director (Orest T. Dackow)
/s/ Andre Desmarais* 1/28, 2000
- -------------------------------------- -----
Director (Andre Desmarais)
/s/ Paul Desmarais, Jr. 1/28, 2000
- ------------------------------------- -----
Director (Paul Desmarais, Jr.)
, 2000
- ------------------------------------ ----
Director (Robert G. Graham)
/s/ N. Berne Hart* 1/28, 2000
- ------------------------------------- -----
Director (N. Berne Hart)
/s/ Kevin P. Kavanagh* 1/28, 2000
- -------------------------------------- -----
Director (Kevin P. Kavanagh)
/s/ William Mackness* 1/28, 2000
- ------------------------------------- -----
Director (William Mackness)
<PAGE>
Signature and Title Date
, 2000
- ------------------------------------ -----
Director (Jerry E.A. Nickerson)
/s/ P. Michael Pitfield* 1/28, 2000
- ------------------------------------ -----
Director (P. Michael Pitfield)
/s/ Michel Plessis-Belair* 1/28, 2000
- ------------------------------------------ -----
Director (Michel Plessis-Belair)
/s/ Brian E. Walsh* 1/28, 2000
- -------------------------------------------- -----
Director (Brian E. Walsh)
*By: /s/ D.C. Lennox 1/28, 2000
---------------------------- -----
D. C. Lennox
Attorney-in-fact pursuant to Powers of Attorney filed with this
Registration Statement.
</TABLE>
<PAGE>
Exhibit Table
Form S-3
Exhibit
1. Form of Underwriting agreement and
and Distribution Agreement 3
4. (i) Form of Combination Fixed and
Variable Annuity Contract 2
(ii) Form of IRA Endorsement 2
5. Opinion and consent of Ruth B. Lurie 1
24. Powers of Attorney for Messrs. Balog, Dackow,
Desmarais, Desmarais, Jr., Gratton, Hart, Kavanagh
Mackness, Pitfield,
Plessis-Belair and Walsh 1
1 Filed with this Registration Statement.
2 Filed with Pre-Effective Amendment No. 1 to the Registration Statement on Form
S-1 (File No. 333-01173).
3 Filed with Pre-Effective Amendment No. 2 to the Registration Statement on Form
S-1 (File No. 333-01173).
EXHIBIT 5
<PAGE>
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
8515 EAST ORCHARD ROAD
ENGLEWOOD, COLORADO 80111
January 28, 2000
Securities and Exchange Commission
450 Fifth St., N.W.
Washington, D.C. 20549
Re: Opinion of Counsel
Gentlemen:
This letter is furnished as the requisite opinion of counsel described in Form
S-3, Part II, Item 16(5). Under said registration statement, Great-West Life &
Annuity Insurance Company (the "Company") has registered $195,857,994.56 of
securities under the Securities Act of 1933, as amended.
I am the Vice President, Counsel and Associate Secretary of the Company. In so
acting, I have made such examination of the law, records and documents as in my
judgment are necessary or appropriate to enable me to render the opinion
expressed below. For purposes of such examination, I have assumed the
genuineness of all signatures and the conformity to the original of all copies.
I am a member of the Colorado Bar and do not purport to be an expert on the laws
of any other state. My opinion herein as to any other law is based upon a
limited inquiry thereof which I have deemed appropriate under the circumstances.
Based on the foregoing, I am of the opinion with respect to the securities,
assuming that the securities will be issued and sold in accordance with the
provisions of the registration statement, to which the Form S-3 registration
statement is applicable and with which this opinion accompanies, will be legally
issued, fully paid and nonassessable. I consent to the use of this opinion as an
exhibit to the registration statement.
Sincerely,
/s/ Ruth B. Lurie
Ruth B. Lurie
Vice President, Counsel
and Associate Secretary
EXHIBIT 24
<PAGE>
POWER OF ATTORNEY
RE
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Know all men by these presents, that I, J. Balog, a Member of the Board of
Directors of Great-West Life & Annuity Insurance Company, a Colorado
corporation, do hereby constitute and appoint each of D.C. Lennox and G.R.
Derback as my true and lawful attorney and agent for me and in my name and on my
behalf to do, individually and without the concurrence of the other attorney and
agent, any and all acts and things and to execute any and all instruments which
either said attorney and agent may deem necessary or desirable to enable
Great-West Life & Annuity Insurance Company to comply with the Securities Act of
1933 and any rules, regulations, and requirements of the Securities and Exchange
Commission thereunder, in connection with the registration under said Act of
market value adjusted annuity contracts, including specifically, but without
limiting the generality of the foregoing, power and authority to sign my name,
in my capacity as a Member of the Board of Directors of Great-West Life &
Annuity Insurance Company to the Registration Statement (Form S-3) of Great-West
Life & Annuity Insurance Company, and to any and all amendments thereto, and I
hereby ratify and confirm all that either said attorney and agent shall do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have hereunto set my hand this 22nd day of January , 2000.
/s/ J. Balog
J. Balog, Director
Great-West Life & Annuity Insurance Company
Witness:
/s/ Alvina B. Balog
Name:
(Type or print name of witness)
<PAGE>
POWER OF ATTORNEY
RE
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Know all men by these presents, that I, O.T. Dackow, a Member of the Board of
Directors of Great-West Life & Annuity Insurance Company, a Colorado
corporation, do hereby constitute and appoint each of D.C. Lennox and G.R.
Derback as my true and lawful attorney and agent for me and in my name and on my
behalf to do, individually and without the concurrence of the other attorney and
agent, any and all acts and things and to execute any and all instruments which
either said attorney and agent may deem necessary or desirable to enable
Great-West Life & Annuity Insurance Company to comply with the Securities Act of
1933 and any rules, regulations, and requirements of the Securities and Exchange
Commission thereunder, in connection with the registration under said Act of
market value adjusted annuity contracts, including specifically, but without
limiting the generality of the foregoing, power and authority to sign my name,
in my capacity as a Member of the Board of Directors of Great-West Life &
Annuity Insurance Company to the Registration Statement (Form S-3) of Great-West
Life & Annuity Insurance Company, and to any and all amendments thereto, and I
hereby ratify and confirm all that either said attorney and agent shall do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have hereunto set my hand this 24th day of January, 2000.
/s/ O.T. Dackow
O.T. Dackow, Director
Great-West Life & Annuity Insurance Company
Witness:
/s/ Beverly A. Martin
Name:
(Type or print name of witness)
<PAGE>
POWER OF ATTORNEY
RE
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Know all men by these presents, that I, A. Desmarais, a Member of the Board of
Directors of Great-West Life & Annuity Insurance Company, a Colorado
corporation, do hereby constitute and appoint each of D.C. Lennox and G.R.
Derback as my true and lawful attorney and agent for me and in my name and on my
behalf to do, individually and without the concurrence of the other attorney and
agent, any and all acts and things and to execute any and all instruments which
either said attorney and agent may deem necessary or desirable to enable
Great-West Life & Annuity Insurance Company to comply with the Securities Act of
1933 and any rules, regulations, and requirements of the Securities and Exchange
Commission thereunder, in connection with the registration under said Act of
market value adjusted annuity contracts, including specifically, but without
limiting the generality of the foregoing, power and authority to sign my name,
in my capacity as a Member of the Board of Directors of Great-West Life &
Annuity Insurance Company to the Registration Statement (Form S-3) of Great-West
Life & Annuity Insurance Company, and to any and all amendments thereto, and I
hereby ratify and confirm all that either said attorney and agent shall do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have hereunto set my hand this 20th day of January, 2000.
/s/ A. Desmarais
A. Desmarais, Director
Great-West Life & Annuity Insurance Company
Witness:
/s/ Anne Marie Gaudreau
Name:
(Type or print name of witness)
<PAGE>
POWER OF ATTORNEY
RE
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Know all men by these presents, that I, P. Desmarais, Jr., a Member of the Board
of Directors of Great-West Life & Annuity Insurance Company, a Colorado
corporation, do hereby constitute and appoint each of D.C. Lennox and G.R.
Derback as my true and lawful attorney and agent for me and in my name and on my
behalf to do, individually and without the concurrence of the other attorney and
agent, any and all acts and things and to execute any and all instruments which
either said attorney and agent may deem necessary or desirable to enable
Great-West Life & Annuity Insurance Company to comply with the Securities Act of
1933 and any rules, regulations, and requirements of the Securities and Exchange
Commission thereunder, in connection with the registration under said Act of
market value adjusted annuity contracts, including specifically, but without
limiting the generality of the foregoing, power and authority to sign my name,
in my capacity as a Member of the Board of Directors of Great-West Life &
Annuity Insurance Company to the Registration Statement (Form S-3) of Great-West
Life & Annuity Insurance Company, and to any and all amendments thereto, and I
hereby ratify and confirm all that either said attorney and agent shall do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have hereunto set my hand this 25th day of January, 2000.
/s/ P. Desmarais, Jr.
P. Desmarais, Jr., Director
Great-West Life & Annuity Insurance Company
Witness:
/s/ Lucie Filteau
Name:
(Type or print name of witness)
<PAGE>
POWER OF ATTORNEY
RE
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Know all men by these presents, that I, R. Gratton, a Member of the Board of
Directors of Great-West Life & Annuity Insurance Company, a Colorado
corporation, do hereby constitute and appoint each of D.C. Lennox and G.R.
Derback as my true and lawful attorney and agent for me and in my name and on my
behalf to do, individually and without the concurrence of the other attorney and
agent, any and all acts and things and to execute any and all instruments which
either said attorney and agent may deem necessary or desirable to enable
Great-West Life & Annuity Insurance Company to comply with the Securities Act of
1933 and any rules, regulations, and requirements of the Securities and Exchange
Commission thereunder, in connection with the registration under said Act of
market value adjusted annuity contracts, including specifically, but without
limiting the generality of the foregoing, power and authority to sign my name,
in my capacity as a Member of the Board of Directors of Great-West Life &
Annuity Insurance Company to the Registration Statement (Form S-3) of Great-West
Life & Annuity Insurance Company, and to any and all amendments thereto, and I
hereby ratify and confirm all that either said attorney and agent shall do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have hereunto set my hand this 21st day of January, 2000.
/s/ R. Gratton
R. Gratton, Director
Great-West Life & Annuity Insurance Company
Witness:
/s/ Nicole Barolet
Name:
(Type or print name of witness)
<PAGE>
POWER OF ATTORNEY
RE
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Know all men by these presents, that I, N.B. Hart, a Member of the Board of
Directors of Great-West Life & Annuity Insurance Company, a Colorado
corporation, do hereby constitute and appoint each of D.C. Lennox and G.R.
Derback as my true and lawful attorney and agent for me and in my name and on my
behalf to do, individually and without the concurrence of the other attorney and
agent, any and all acts and things and to execute any and all instruments which
either said attorney and agent may deem necessary or desirable to enable
Great-West Life & Annuity Insurance Company to comply with the Securities Act of
1933 and any rules, regulations, and requirements of the Securities and Exchange
Commission thereunder, in connection with the registration under said Act of
market value adjusted annuity contracts, including specifically, but without
limiting the generality of the foregoing, power and authority to sign my name,
in my capacity as a Member of the Board of Directors of Great-West Life &
Annuity Insurance Company to the Registration Statement (Form S-3) of Great-West
Life & Annuity Insurance Company, and to any and all amendments thereto, and I
hereby ratify and confirm all that either said attorney and agent shall do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have hereunto set my hand this 21st day of January, 2000.
/s/ N.B. Hart
N.B. Hart, Director
Great-West Life & Annuity Insurance Company
Witness:
/s/ Wilma J. Hart
Name:
(Type or print name of witness)
<PAGE>
POWER OF ATTORNEY
RE
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Know all men by these presents, that I, K.P. Kavanagh, a Member of the Board of
Directors of Great-West Life & Annuity Insurance Company, a Colorado
corporation, do hereby constitute and appoint each of D.C. Lennox and G.R.
Derback as my true and lawful attorney and agent for me and in my name and on my
behalf to do, individually and without the concurrence of the other attorney and
agent, any and all acts and things and to execute any and all instruments which
either said attorney and agent may deem necessary or desirable to enable
Great-West Life & Annuity Insurance Company to comply with the Securities Act of
1933 and any rules, regulations, and requirements of the Securities and Exchange
Commission thereunder, in connection with the registration under said Act of
market value adjusted annuity contracts, including specifically, but without
limiting the generality of the foregoing, power and authority to sign my name,
in my capacity as a Member of the Board of Directors of Great-West Life &
Annuity Insurance Company to the Registration Statement (Form S-3) of Great-West
Life & Annuity Insurance Company, and to any and all amendments thereto, and I
hereby ratify and confirm all that either said attorney and agent shall do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have hereunto set my hand this 21st day of January, 2000.
/s/ K.P. Kavanagh
K.P. Kavanagh, Director
Great-West Life & Annuity Insurance Company
Witness:
/s/ Jennifer Moncrieff
Name:
(Type or print name of witness)
<PAGE>
POWER OF ATTORNEY
RE
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Know all men by these presents, that I, W. Mackness, a Member of the Board of
Directors of Great-West Life & Annuity Insurance Company, a Colorado
corporation, do hereby constitute and appoint each of D.C. Lennox and G.R.
Derback as my true and lawful attorney and agent for me and in my name and on my
behalf to do, individually and without the concurrence of the other attorney and
agent, any and all acts and things and to execute any and all instruments which
either said attorney and agent may deem necessary or desirable to enable
Great-West Life & Annuity Insurance Company to comply with the Securities Act of
1933 and any rules, regulations, and requirements of the Securities and Exchange
Commission thereunder, in connection with the registration under said Act of
market value adjusted annuity contracts, including specifically, but without
limiting the generality of the foregoing, power and authority to sign my name,
in my capacity as a Member of the Board of Directors of Great-West Life &
Annuity Insurance Company to the Registration Statement (Form S-3) of Great-West
Life & Annuity Insurance Company, and to any and all amendments thereto, and I
hereby ratify and confirm all that either said attorney and agent shall do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have hereunto set my hand this 21st day of January, 2000.
/s/ W. Mackness
W. Mackness, Director
Great-West Life & Annuity Insurance Company
Witness:
/s/ A. Mackness
Name:
(Type or print name of witness)
<PAGE>
POWER OF ATTORNEY
RE
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Know all men by these presents, that I, P.M. Pitfield, a Member of the Board of
Directors of Great-West Life & Annuity Insurance Company, a Colorado
corporation, do hereby constitute and appoint each of D.C. Lennox and G.R.
Derback as my true and lawful attorney and agent for me and in my name and on my
behalf to do, individually and without the concurrence of the other attorney and
agent, any and all acts and things and to execute any and all instruments which
either said attorney and agent may deem necessary or desirable to enable
Great-West Life & Annuity Insurance Company to comply with the Securities Act of
1933 and any rules, regulations, and requirements of the Securities and Exchange
Commission thereunder, in connection with the registration under said Act of
market value adjusted annuity contracts, including specifically, but without
limiting the generality of the foregoing, power and authority to sign my name,
in my capacity as a Member of the Board of Directors of Great-West Life &
Annuity Insurance Company to the Registration Statement (Form S-3) of Great-West
Life & Annuity Insurance Company, and to any and all amendments thereto, and I
hereby ratify and confirm all that either said attorney and agent shall do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have hereunto set my hand this 21st day of January, 2000.
/s/ P.M. Pitfield
P.M. Pitfield, Director
Great-West Life & Annuity Insurance Company
Witness:
/s/ Raymond Cloutier
Name:
(Type or print name of witness)
<PAGE>
POWER OF ATTORNEY
RE
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Know all men by these presents, that I, M. Plessis-Belair, a Member of the Board
of Directors of Great-West Life & Annuity Insurance Company, a Colorado
corporation, do hereby constitute and appoint each of D.C. Lennox and G.R.
Derback as my true and lawful attorney and agent for me and in my name and on my
behalf to do, individually and without the concurrence of the other attorney and
agent, any and all acts and things and to execute any and all instruments which
either said attorney and agent may deem necessary or desirable to enable
Great-West Life & Annuity Insurance Company to comply with the Securities Act of
1933 and any rules, regulations, and requirements of the Securities and Exchange
Commission thereunder, in connection with the registration under said Act of
market value adjusted annuity contracts, including specifically, but without
limiting the generality of the foregoing, power and authority to sign my name,
in my capacity as a Member of the Board of Directors of Great-West Life &
Annuity Insurance Company to the Registration Statement (Form S-3) of Great-West
Life & Annuity Insurance Company, and to any and all amendments thereto, and I
hereby ratify and confirm all that either said attorney and agent shall do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have hereunto set my hand this 21st day of January, 2000.
/s/ M. Plessis-Belair
M. Plessis-Belair, Director
Great-West Life & Annuity Insurance Company
Witness:
/s/ Danielle Durocher
Name:
(Type or print name of witness)
<PAGE>
POWER OF ATTORNEY
RE
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Know all men by these presents, that I, B.E. Walsh, a Member of the Board of
Directors of Great-West Life & Annuity Insurance Company, a Colorado
corporation, do hereby constitute and appoint each of D.C. Lennox and G.R.
Derback as my true and lawful attorney and agent for me and in my name and on my
behalf to do, individually and without the concurrence of the other attorney and
agent, any and all acts and things and to execute any and all instruments which
either said attorney and agent may deem necessary or desirable to enable
Great-West Life & Annuity Insurance Company to comply with the Securities Act of
1933 and any rules, regulations, and requirements of the Securities and Exchange
Commission thereunder, in connection with the registration under said Act of
market value adjusted annuity contracts, including specifically, but without
limiting the generality of the foregoing, power and authority to sign my name,
in my capacity as a Member of the Board of Directors of Great-West Life &
Annuity Insurance Company to the Registration Statement (Form S-3) of Great-West
Life & Annuity Insurance Company, and to any and all amendments thereto, and I
hereby ratify and confirm all that either said attorney and agent shall do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have hereunto set my hand this 24th day of January, 2000.
/s/ B. E. Walsh
B.E. Walsh, Director
Great-West Life & Annuity Insurance Company
Witness:
/s/ Margaret Canty
Name:
(Type or print name of witness)
