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MONY Custom Estate Master
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Prospectus Portfolio
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Last Survivor
Flexible Premium
Variable Universal Life
Insurance Policy
Issued by
MONY Life Insurance Company of America
MONY Series Fund, Inc.
Enterprise Accumulation Trust
December 14, 1998
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PROSPECTUS
DATED DECEMBER 14, 1998
LAST SURVIVOR FLEXIBLE PREMIUM
VARIABLE UNIVERSAL LIFE INSURANCE POLICY
ISSUED BY
MONY LIFE INSURANCE COMPANY OF AMERICA
MONY AMERICA VARIABLE ACCOUNT L
This prospectus describes a flexible premium joint survivorship variable
universal life insurance policy (individually, the "Policy," and collectively,
the "Policies") offered by MONY Life Insurance Company of America (the
"Company"), a wholly-owned subsidiary of MONY Life Insurance Company. The
Policy, for so long as it remains in force, provides insurance protection on the
two Insureds named in the Policy through the Maturity Date. The Policy is
designed to provide maximum flexibility in connection with premium payments and
death benefits by permitting, subject to certain restrictions, the frequency and
amount of premium payments to vary and the death benefit payable under the
Policy to increase or decrease. A Policy may also be surrendered for its Cash
Value.
The Company will pay the death proceeds to the Beneficiary when the last
surviving Insured dies if the Policy is still in force. The death proceeds will
equal the Death Benefit, plus any amount provided under the Four Year Term
Insurance Rider, less any Outstanding Debt, and by any charges due during the
Grace Period. The Policy will remain in force as long as the Cash Value remains
greater than zero. If at all times during the first three Policy years, the sum
of premiums paid less Partial Surrenders taken (excluding their fees) and any
Outstanding Debt is greater than or equal to the Minimum Monthly Premium times
the number of completed months this Policy has been in force or the Cash Value
is greater than zero, the Policy and all Rider coverages will not lapse. If the
Guaranteed Death Benefit Rider is purchased, the Specified Amount of the Policy
and certain Rider coverages will remain in force for the Guarantee Period if the
required premiums less Partial Surrenders taken (and their fees) less any
Outstanding Debt have been paid. The Guaranteed Death Benefit Rider is not
available in all states.
The Policy permits the choice of two death benefit Options: under Option 1,
the Death Benefit remains fixed at the Specified Amount chosen; under Option 2,
the Death Benefit equals the Specified Amount plus Fund Value (under certain
circumstances, the Death Benefit may be greater). Under Option 2, the Death
Benefit will vary daily with the investment performance of the Subaccounts for
any Policy Owner who has allocated net premiums to the Variable Account. Under
either Option, for so long as the Policy remains in force, the Death Benefit
will never be less than the current Specified Amount.
The Policy also permits an owner of the Policy to obtain loans from the
Company in amounts up to 90% of the Cash Value of the Policy, and it permits an
Owner to surrender a part of the Policy and receive a part of the Cash Value of
the Policy.
Net premiums may be allocated at the Policy Owner's discretion to one or
more of the Subaccounts that comprise a separate account of the Company called
the MONY America Variable Account L (the "Variable Account"), or to the
Guaranteed Interest Account of the Company. Any portion of a net premium
allocated to one or more of the Subaccounts is used to purchase shares of the
corresponding Portfolios of the MONY Series Fund, Inc. (the "MONY Series Fund")
or the Enterprise Accumulation Trust (the "Accumulation Trust"). The available
Portfolios of the MONY Series Fund currently are: the Money Market Portfolio,
the Government Securities Portfolio, the Intermediate Term Bond Portfolio, and
the Long Term Bond Portfolio. The available Portfolios of the Accumulation Trust
are: the Equity Portfolio, the Small Company Value Portfolio, the Managed
Portfolio, the International Growth Portfolio, the High Yield Bond Portfolio,
the Small Company Growth Portfolio, The Equity Income Portfolio, the Capital
Appreciation Portfolio, the Growth and Income Portfolio, and the Growth
Portfolio. The Loan Account represents amounts set aside as collateral for any
Policy Debt.
To the extent that all or a portion of net premiums are allocated to the
Variable Account, the Fund Value under the Policy will vary based upon the
investment performance of the Subaccounts to which the Fund Value is allocated.
Net premiums allocated to the Guaranteed Interest Account are assets of the
General Account of the Company. The Fund Value in the Guaranteed Interest
Account will accrue interest at an interest rate that is guaranteed by the
Company. No minimum amount of Fund Value is guaranteed, except to the extent
premiums are allocated to the Guaranteed Interest Account.
A Policy may be returned during the Right to Return Policy Period (see
"Right to Examine a Policy -- Right to Return Policy Period," page 16), during
which time net premium payments earn an interest rate guaranteed by the Company.
It may not be advantageous to replace existing insurance with the Policy.
This prospectus generally describes only the portion of the Policy involving
the Variable Account. For a brief summary of the Guaranteed Interest Account,
see "The Guaranteed Interest Account," page 8.
In pursuing its investment objective, the High Yield Bond Subaccount
purchases shares of the High Yield Bond Portfolio which may invest significantly
in lower rated bonds, commonly referred to as "Junk Bonds". Bonds of this type
are considered to be speculative with regard to the payment of interest and
return of principal. Investment in these types of securities have special risks
and, therefore, may not be suitable for all investors. Investors should
carefully assess the risks associated with allocating premium payments to this
subaccount.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. THIS
PROSPECTUS IS ACCOMPANIED BY THE CURRENT PROSPECTUSES FOR THE MONY SERIES FUND,
INC. AND THE ENTERPRISE ACCUMULATION TRUST. THESE PROSPECTUSES SHOULD BE READ
CAREFULLY AND RETAINED FOR FUTURE REFERENCE.
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MONY LIFE INSURANCE COMPANY OF AMERICA
1740 BROADWAY
NEW YORK, NEW YORK 10019
1-800-487-6669
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TABLE OF CONTENTS
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TABLE OF CONTENTS..................... i
IMPORTANT TERMS....................... 1
SUMMARY OF THE POLICY................. 3
Purpose of the Policy............... 3
Policy Values....................... 3
The Death Benefit................... 4
Premium Features.................... 4
Allocation Options.................. 5
Transfer of Fund Value.............. 5
Policy Loans........................ 5
Full Surrender...................... 5
Partial Surrender................... 5
Right to Return Policy Period....... 6
Grace Period and Lapse.............. 6
Charges and Deductions.............. 6
Deductions from Premiums......... 6
Daily Deduction from the Variable
Account........................ 7
Deductions from Fund Value....... 7
Surrender Charge................. 7
Transaction and Other Charges.... 7
Tax Treatment of Increases in Fund
Value............................ 7
Tax Treatment of Death Benefit...... 8
The Guaranteed Interest Account..... 8
Contacting the Company.............. 8
INFORMATION ABOUT THE COMPANY AND THE
VARIABLE ACCOUNT.................... 8
MONY Life Insurance Company of
America.......................... 8
Year 2000 Issue..................... 9
MONY America Variable Account L..... 9
The Funds........................... 10
Purchase of Portfolio Shares by the
Variable Account................. 11
The Money Market Portfolio....... 12
The Government Securities
Portfolio...................... 12
The Intermediate Term Bond
Portfolio...................... 12
The Long Term Bond Portfolio..... 12
The Equity Income Portfolio...... 12
The Growth and Income
Portfolio...................... 12
The Growth Portfolio............. 13
The Equity Portfolio............. 13
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The Capital Appreciation
Portfolio...................... 13
The Managed Portfolio............ 13
The Small Company Growth
Portfolio...................... 13
The Small Company Value
Portfolio...................... 13
The International Growth
Portfolio...................... 13
The High Yield Bond Portfolio.... 13
THE POLICY............................ 13
Application for a Policy............ 14
Temporary Insurance Coverage..... 14
Initial Premium Payment.......... 15
Policy Date...................... 15
Risk Classifications............. 15
Right to Examine a Policy -- Right
to Return Policy Period.......... 16
Premiums............................ 16
Premium Flexibility.............. 16
Scheduled Premium Payments
(Planned Premium Payments)..... 16
Choice of Tests for Compliance
with IRS Definition of Life
Insurance...................... 17
Guaranteed Death Benefit Rider... 17
Modified Endowment Contracts..... 17
Unscheduled Premium Payments..... 17
Premium Payments Affect the
Continuation of the Policy..... 18
Allocation of Net Premiums.......... 18
Death Benefits Under the Policy..... 18
Death Benefit Options............... 19
Option 1......................... 19
Option 2......................... 19
Examples of Options 1 and 2...... 19
Changes in Death Benefit
Option......................... 20
Changes in Specified Amount......... 20
Increases........................ 21
Decreases........................ 21
Guaranteed Death Benefit............ 21
Other Optional Insurance Benefits... 22
Waiver of Monthly Deductions
Rider.......................... 22
Waiver of Specified Premium
Rider.......................... 22
Four Year Term Insurance Rider... 23
Option to Split Policy Benefit... 23
Benefits at Maturity................ 23
Policy Values....................... 23
Fund Value....................... 23
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Cash Value....................... 23
Determination of Fund Value......... 24
Calculating Unit Values for Each
Subaccount....................... 24
Transfer of Fund Value.............. 25
Right to Exchange Policy............ 25
Policy Loans........................ 25
Full Surrender...................... 26
Partial Surrender................... 27
Grace Period and Lapse.............. 27
Special Rule for First Three
Policy Years................... 28
If Guaranteed Death Benefit Rider
Is Not in Effect............... 28
If Guaranteed Death Benefit Rider
Is in Effect................... 28
Reinstatement.................... 29
CHARGES AND DEDUCTIONS................ 29
Deductions from Premiums............ 29
Sales Charge..................... 29
Tax Charges...................... 30
Daily Deductions from the Variable
Account.......................... 30
Mortality and Expense Risk
Charge......................... 30
Monthly Deductions from Fund
Value............................ 30
Cost of Insurance................ 30
Administrative Charge............ 31
Per $1,000 Specified Amount
Charge......................... 31
Guaranteed Death Benefit
Charge......................... 31
Other Optional Insurance Benefits
Charges........................ 31
Surrender Charge.................... 31
Corporate Purchasers................ 32
Transaction and Other Charges....... 32
Fees and Expenses of the Funds...... 32
Guarantee of Certain Charges........ 33
OTHER INFORMATION..................... 34
Federal Income Tax Considerations... 34
Definition of Life Insurance..... 34
Diversification Requirements..... 34
Tax Treatment of Policies........ 35
Conventional Life Insurance
Policies....................... 35
Modified Endowment Contracts..... 36
Reasonableness Requirement for
Charges........................ 36
Riders, Policy Changes, and
Transfers...................... 37
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Other Employee Benefit
Programs....................... 37
Other............................ 37
Charge for Company Income Taxes..... 37
Voting of Fund Shares............... 38
Disregard of Voting Instructions.... 38
Report to Policy Owners............. 38
Substitution of Investments and
Right to Change Operations....... 39
Changes to Comply with Law.......... 39
PERFORMANCE INFORMATION............... 39
THE GUARANTEED INTEREST ACCOUNT....... 40
General Description................. 40
Death Benefit....................... 41
Policy Charges...................... 41
Transfers........................... 41
Surrenders and Policy Loans......... 42
MORE ABOUT THE POLICY................. 42
Ownership........................... 42
Joint Owners..................... 42
Beneficiary......................... 42
The Policy.......................... 42
Notification and Claims
Procedures....................... 42
Payments............................ 43
Payment Plan/Settlement
Provisions....................... 43
Payment in Case of Suicide.......... 43
Assignment.......................... 43
Errors on The Application........... 43
Incontestability.................... 44
Policy Illustrations................ 44
Distribution of The Policy.......... 44
MORE ABOUT THE COMPANY................ 45
Management.......................... 45
State Regulation.................... 45
Telephone Transfer Privileges....... 45
Legal Proceedings................... 46
Legal Matters....................... 46
Registration Statement.............. 46
Independent Accountants............. 46
Financial Statements................ 46
Index to Financial Statements......... F-1
Appendix A............................ A-1
Appendix B............................ B-1
Appendix C............................ C-1
Appendix D............................ D-1
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IMPORTANT TERMS
Administrative Office -- The Company's administrative office at 1740
Broadway, New York, New York, 10019. "Administrative Office" also includes the
Company's Syracuse Operations Center at 1 MONY Plaza, Syracuse, N.Y. 13202.
Age -- Each Insured's age as of his or her last birthday on the Policy
Date, increased by the number of complete Policy Years elapsed.
Beneficiary -- The person or persons named by the Policy Owner in the
application or by proper later designation to receive the death proceeds upon
the death of the last surviving Insured.
Business Day -- Each date on which the Variable Account is valued, which
currently includes each day that the New York Stock Exchange (or International
Exchange) is open for trading or any other day on which there is sufficient
trading in the securities of a Portfolio of the Funds to affect materially the
unit value of the corresponding Subaccount of the Variable Account.
Cash Value -- The Fund Value for the Policy less Surrender Charge and less
any Outstanding Debt.
Company, the -- MONY Life Insurance Company of America.
Death Benefit -- Initially, this is the Specified Amount for Policies under
death benefit Option 1, or the Specified Amount plus the Fund Value for Policies
under death benefit Option 2. The Death Benefit may subsequently change
depending on the death benefit Option chosen and the Federal income tax law
definition of life insurance.
Funds -- The MONY Series Fund, Inc. and the Enterprise Accumulation Trust.
Fund Value -- The sum of the amounts under the Policy held in each
Subaccount of the Variable Account and the Guaranteed Interest Account, as well
as any amount set aside in the Company's Loan Account, and any interest thereon,
to secure Outstanding Debt.
General Account -- All assets of the Company other than those allocated to
the Variable Account or to any other segregated separate account of the Company.
Guaranteed Interest Account -- An account that is part of Company's General
Account to which all or a portion of net premium payments may be allocated for
accumulation at a fixed rate of interest (which may not be less than 4.5%)
declared by Company.
Guarantee Period -- The period during which the Specified Amount is
guaranteed under the Guaranteed Death Benefit Rider. The Guaranteed Death
Benefit Rider is not available in all states. See "Guaranteed Death Benefit",
page 21. .
Insured(s) -- The persons upon whose lives the Policy is issued, and upon
whose deaths is the contingency upon which the Death Benefit proceeds are
payable.
Loan Account -- An account to which amounts are transferred from the
Subaccounts and the Guaranteed Interest Account as collateral for any
Outstanding Debt. The Loan Account is part of the Company's General Account, and
it accumulates interest at a rate not less than 4.5%.
Maturity Date -- The Policy Anniversary on which the younger Insured is (or
would have been) Age 100.
Minimum Monthly Premium -- The amount determined by the Company which is
necessary to keep the Policy in force for the first three Policy Years.
Monthly Anniversary Day -- The day each month on which the monthly
deduction is due against the Fund Value. The first Monthly Anniversary Day is
the Policy Date.
Monthly Guarantee Premium -- The premium amount stated in the Policy as the
amount required to maintain the Guaranteed Death Benefit Rider. The Monthly
Guarantee Premium changes whenever the Specified Amount changes.
Outstanding Debt -- The unpaid loan balance including accrued loan interest
due and unpaid.
Partial Surrender -- The surrender of a portion of the Policy. At least
$500 of Cash Value must remain after a Partial Surrender, or a full surrender of
the Policy will be required.
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Planned Premium Payments -- The premium amount specified on the application
as the amount the Policy Owner intends to pay at selected intervals over a
specified period of time. Within specified limits, premiums in excess of Planned
Premium Payments may be paid. Planned Premium Payments may be changed at any
time. For policies offered or issued for delivery outside the Commonwealth of
Massachusetts, see the term "Scheduled Premium Payments".
Policy Date -- The date set forth on page 1 of the Policy that is used to
determine the Monthly Anniversary Day, Policy months, and Policy years. Policy
monthly, quarterly, semiannual and annual anniversaries are measured from the
Policy Date. Each Policy month starts on the same date in each calendar month as
that specified as the Policy Date. Where the Policy Date is the 29th, 30th, or
31st of a month, and there is no such date in a calendar month, the Policy month
for such month will start on the last day of that calendar month.
Policy Owner or Owner -- The person or persons who own(s) the Policy. If
the Policy has been absolutely assigned, the assignee becomes the Policy Owner.
A collateral assignee is not the Owner.
Portfolio(s) -- The separate investment portfolios of the Funds.
Rider -- The addendum to a Policy which adds an optional insurance benefit
to the Policy.
Right to Return Policy Period -- The Period which follows the application
for the Policy and its issuance to the Policy Owner. During the Right to Return
Policy Period which follows the issuance of the Policy, the Policy Owner may
cancel the Policy and receive a refund.
Scheduled Premium Payments -- The premium amount specified on the
application as the amount the Policy Owner intends to pay at fixed intervals
over a specified period of time. Within specified limits, premiums in excess of
the Scheduled Premium Payments may be paid. Scheduled Premium Payments may be
changed at any time. For policies offered or issued for delivery in the
Commonwealth of Massachusetts, see the term "Planned Premium Payments".
Specified Amount -- The minimum Death Benefit for so long as the Policy
remains in force. The Specified Amount may be increased or decreased under
certain circumstances.
Subaccounts -- The subdivisions of the Variable Account. Each Subaccount
invests exclusively in the shares of a corresponding Portfolio of one of the
Funds.
Surrender Charge -- The contingent deferred charge determined for the
initial Specified Amount of the Policy and for each increase in Specified
Amount.
Target Premium -- The maximum amount of premiums paid against which the
sales charge may be applied.
Transaction Date -- The date the Company receives a premium or acceptable
written or telephone request at the Administrative Office. If the premium or
request reaches the Administrative Office on a day which is not a Business Day
or after the close of business on a Business Day (i.e., after 4:00 p.m. Eastern
Time), the Transaction Date will be the next Business Day.
Unit -- The bookkeeping measure used to value the amounts allocated to the
Subaccounts of the Variable Account.
Unit Value -- The value of the Units of each Subaccount of the Variable
Account. Unit Values are calculated for each Subaccount on each Business Day.
Valuation Period -- The period that starts at the close of a Business Day
and ends at the close of the next succeeding Business Day.
Variable Account -- The Company's Variable Account L, a separate investment
account established by the Company to receive and invest the net premiums paid
under the Policy.
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SUMMARY OF THE POLICY
This summary is intended to provide a brief overview of the more
significant aspects of the Policy. Further detail is provided in this prospectus
and in the Policy. Unless the context indicates otherwise, the discussion in
this summary and the remainder of the prospectus relates to the portion of the
Policy involving the Variable Account. The Guaranteed Interest Account is
briefly described under "The Guaranteed Interest Account," on page 40 and in the
Policy.
PURPOSE OF THE POLICY
The Policy offers a Policy Owner insurance protection on the lives of the
Insureds through the Maturity Date for so long as the Policy is in force. The
Death Benefit is payable upon the death of the last surviving Insured while the
Policy is in force. A maturity benefit will be paid in lieu of a death benefit
when the Policy reaches the Maturity Date during the lifetime of either or both
the Insureds. Like traditional fixed life insurance, the Policy provides for a
death benefit equal to its Death Benefit plus any amount payable by Rider,
accumulation of Cash Value, and surrender and loan privileges. Unlike
traditional fixed life insurance, the Policy offers a choice of investment
alternatives and an opportunity for the Policy's Fund Value and its death
benefit, to grow based on investment results. The Policy is a flexible premium
policy, so that, unlike many other insurance policies, a Policy Owner may choose
the amount and frequency of premium payments, within certain limits.
POLICY VALUES
A Policy Owner may allocate net premium payments among the various
Subaccounts that comprise the Variable Account and that invest in corresponding
Portfolios of the MONY Series Fund and the Accumulation Trust. A Policy Owner
may also allocate net premium payments to the Guaranteed Interest Account. The
Loan Account represents amounts set aside in the General Account of the Company
as collateral for Outstanding Debt.
The Fund Value of the Policy is the sum of amounts allocated to the
Subaccounts of the Variable Account, the Guaranteed Interest Account and the
Loan Account. The Cash Value of the Policy is the Fund Value less the Surrender
Charge and less any Outstanding Debt.
Depending on the investment experience of the selected Subaccounts, the
Fund Value may increase or decrease on any day. The Death Benefit may increase
or decrease depending upon several factors, including the death benefit Option
selected by the Policy Owner, although the death benefit will never decrease
below the Specified Amount provided the Policy is in force. There is no
guarantee that the Policy's Fund Value and death benefit will increase. The
Policy Owner bears the investment risk on that portion of the net premiums and
Fund Value allocated to the Variable Account.
The Policy will remain in force until the earliest of the Maturity Date,
the death of the last surviving Insured, or a full surrender of the Policy,
unless, before any of these events, the Policy lapses and a Grace Period expires
without sufficient additional premium payment or repayment of Outstanding Debt
by the Policy Owner.
Generally, the Policy will remain in force only as long as the Cash Value
is sufficient to pay all the monthly deductions. However, if the premiums paid
meet the Minimum Monthly Premium requirement during the first three Policy
years, the Policy and all Rider coverages will remain in force even if the Cash
Value of the Policy is less than zero. If an increase in Specified Amount occurs
during the first three Policy years, the Minimum Monthly Premium requirement is
increased following the effective date of the increase. If the Guaranteed Death
Benefit Rider is purchased, the Specified Amount of the Policy and certain Rider
coverages will remain in force for the Guarantee Period if the required premiums
have been paid. The amount by which the Death Benefit may exceed the Specified
Amount is not guaranteed by the Guaranteed Death Benefit Rider. The Guaranteed
Death Benefit Rider is not available in all states.
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THE DEATH BENEFIT
The minimum Specified Amount at issue for a Policy is $100,000. The Policy
Owner may elect one of two death benefit Options and may choose which of the two
tests for compliance with the Federal income tax law definition of life
insurance will be used to calculate the amount of Death Benefit payable under
the Policy. The Death Benefit under Option 1 will be equal to the Specified
Amount of the Policy on the date of death of the last surviving Insured or, if
greater, the Fund Value on the date of death of the last surviving Insured
multiplied by a death benefit percentage required by the Federal income tax law
definition of life insurance. Under Option 2, the Death Benefit will be equal to
the Specified Amount of the Policy on the date of death of the last surviving
Insured plus the Fund Value on the date of death of the last surviving Insured
or, if greater, the Fund Value on the date of death of the last surviving
Insured multiplied by a death benefit percentage required by the Federal income
tax law definition of life insurance. Policy Owners seeking to have favorable
investment performance reflected in increasing Fund Value should choose Option
1; Policy Owners seeking to have favorable investment performance reflected in
increasing insurance coverage should choose Option 2. A Policy Owner may change
the death benefit Option, and increase or decrease the Specified Amount, subject
to certain conditions. See "Death Benefits Under the Policy," page 18.
The Policy Owner may, at time of application, choose to purchase the
Guaranteed Death Benefit Rider. This Rider provides a guarantee that the
Specified Amount and certain Rider coverages will remain in force for the
Guarantee Period regardless of the amount of the Policy's Cash Value, if the
required premiums (less Partial Surrenders taken and their related fees) have
been paid. The Rider provides a Guarantee period to the younger Insured's Age 70
or ten years from the Policy Date, whichever is later. The Minimum Monthly
Premium will be higher if the Rider is chosen. An extra charge will also be
deducted from the Fund Value each month the Rider is in effect. See "Guaranteed
Death Benefit," page 21. The Guaranteed Death Benefit Rider is not available in
all states.
PREMIUM FEATURES
The Company requires a Policy Owner to pay an initial premium equal to at
least the Minimum Monthly Premium that is defined by the Company. Thereafter,
subject to certain limitations, a Policy Owner may choose the amount and
frequency of premium payments. The Policy, therefore, provides the Policy Owner
with the flexibility to vary premium payments to reflect varying financial
conditions.
When applying for a Policy, a Policy Owner will determine a Scheduled
Premium Payment that provides for the payment of level premiums in regular
intervals over a specified period of time. Each Policy Owner will receive a
premium reminder notice for the Scheduled Premium Payment on either an annual,
semiannual, or quarterly basis, at the option of the Policy Owner; however, the
Policy Owner may not be required to pay Scheduled Premium Payments. Premiums may
be paid monthly under the Electronic Funds Transfer plan where the Owner
authorizes the Company to withdraw Scheduled Premium Payments from the Owner's
checking account each month. (For Policies offered or issued for delivery in the
Commonwealth of Massachusetts, the Policy Owner will be asked to indicate on the
application the amount the Policy Owner intends to pay at selected intervals.
For those Policy Owners, the term "Scheduled Premium Payment" used in this
Prospectus, refers to Planned Premium Payments.)
The amount, frequency, and period of time over which a Policy Owner pays
premiums may affect whether or not the Policy will be classified as a modified
endowment contract, which is a type of life insurance contract subject to
different tax treatment for certain pre-death distributions. For more
information on the tax treatment of life insurance contracts, including those
classified as modified endowment contracts, see "Federal Income Tax
Considerations," page 34.
Payment of the Scheduled Premiums will not guarantee that a Policy will
remain in force. See "Grace Period and Lapse," page 27. The Company also may
reject or otherwise limit any unscheduled premium payment that would result in
an immediate increase in the net amount at risk under the Policy.
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ALLOCATION OPTIONS
Premium payments and Cash Values may be allocated by the Policy Owner among
the various Subaccounts. Each of the Subaccounts uses premium payments and Fund
Value to purchase shares of a designated portfolio (a "Portfolio") of the MONY
Series Fund, Inc. (the "MONY Series Fund") or the Enterprise Accumulation Trust
(the "Accumulation Trust") (collectively the "Funds"). The available Portfolios
of the Funds, each of which has a different investment objective, are the Money
Market Portfolio, the Government Securities Portfolio, the Intermediate Term
Bond Portfolio, the Long Term Bond Portfolio, the Equity Portfolio, the Small
Company Value Portfolio, the Managed Portfolio, the International Growth
Portfolio, the High Yield Bond Portfolio, the Small Company Growth Portfolio,
the Equity Income Portfolio, the Capital Appreciation Portfolio, the Growth and
Income Portfolio, and the Growth Portfolio. See "The Funds," page 10.
The Company is the investment manager of the MONY Series Fund. Enterprise
Capital Management, Inc., a subsidiary of MONY Life Insurance Company ("MONY"),
is the investment manager of the Accumulation Trust. OpCap Advisors, a
subsidiary of Oppenheimer Capital, is the sub-investment adviser of the Equity
and Managed Portfolios; Brinson Partners, Inc. is the sub-investment adviser of
the International Growth Portfolio; Caywood-Scholl Capital Corporation is the
sub-investment adviser of the High Yield Bond Portfolio; William D. Witter, Inc.
is the sub-investment adviser of the Small Company Growth Portfolio; 1740
Advisors, Inc., an affiliate of MONY, is the sub-investment adviser of the
Equity Income Portfolio; Provident Investment Counsel, Inc. is the
sub-investment adviser of the Capital Appreciation Portfolio; Retirement System
Investors, Inc. is the sub-investment adviser of the Growth and Income
Portfolio; Montag & Caldwell, Inc. is the sub-investment adviser of the Growth
Portfolio; and Gabelli Asset Management, Inc. is the sub-investment advisor of
the Small Company Value Portfolio.
The Policy Owner may choose to allocate net premium payments to any or all
of the available Subaccounts constituting the Variable Account, and to the
Guaranteed Interest Account.
TRANSFER OF FUND VALUE
The Policy Owner may transfer Fund Value among the Subaccounts, and,
subject to certain other limitations, between the Subaccounts and the Guaranteed
Interest Account. Transfers may be made by telephone if an authorization for
telephone transfer form has been properly completed and signed and filed at the
Company's Syracuse Operations Center. See "Transfer of Fund Value," page 25.
POLICY LOANS
The Policy Owner may borrow from the Company an amount up to 90% of the
Policy's Cash Value. The Policy will be the only security required for a loan.
See "Policy Loans," page 25.
The amount of any Outstanding Debt is subtracted from the Death Benefit
upon the death of the last surviving Insured or from the Fund Value upon
surrender. See "Full Surrender," page 26. Outstanding Debt may also impact the
continuation of the Policy. See "Grace Period and Lapse," page 27.
FULL SURRENDER
The Owner can surrender the Policy during the life of either or both of the
Insureds and receive its Cash Value, which is equal to the Fund Value less the
Surrender Charge and less any Outstanding Debt. See "Full Surrender", page 26.
PARTIAL SURRENDER
Partial Surrenders are available under the Policy so long as the Cash Value
remaining after giving effect to the requested surrender and any fees which may
be assessed as a result of the Partial Surrender exceeds any minimum
requirements. If a Partial Surrender is for an amount which exceeds the amount
available, it will be rejected and the request will be returned to the Policy
Owner. A Partial Surrender will decrease the Specified Amount of a Policy if the
Owner has elected death benefit Option 1, and it will decrease the Death Benefit
if
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the Death Benefit is greater than the Specified Amount under either Option 1 or
2. See "Partial Surrender," at page 27. .
Among other restrictions, Partial Surrenders must be for at least $500, the
Policy's Cash Value after the surrender must be at least $500, and the Specified
Amount after the surrender must be no less than $100,000. A Partial Surrender
Fee of $10 will be assessed against the remaining Fund Value. No Surrender
Charge is assessed upon a Partial Surrender.
RIGHT TO RETURN POLICY PERIOD
A Policy Owner may obtain a full refund of the premium paid if the Policy
is returned within 10 days (or longer in certain states) after the Owner
receives it. During the Right to Return Policy Period, net premiums will be
retained in the Company's General Account and will earn interest at an annual
rate of 4.5%. See "Right to Examine a Policy -- Right to Return Policy Period",
page 16.
GRACE PERIOD AND LAPSE
Payment of Scheduled Premium Payments will not guarantee that a Policy will
remain in force. Instead, unless the Guaranteed Death Benefit Rider has been
elected and all requirements have been met, the duration of the Policy depends
upon the Policy's Cash Value. However, during the first three Policy years, if
on each Monthly Anniversary Day the sum of premiums paid, less the sum of
Partial Surrenders (excluding any fees relating thereto) and any Outstanding
Debt is greater than or equal to the Minimum Monthly Premium times the number of
completed Policy months or the Policy's Cash Value is greater than zero, the
Policy is guaranteed not to lapse. If an increase in Specified Amount occurs
during the first three Policy years, the Minimum Monthly Premium requirement
will be increased following the date the increase took effect and will apply
until the end of the first three Policy Years. Even if Scheduled Premium
Payments are made, if either of these two provisions do not apply, the Policy
will lapse any time the Cash Value is insufficient to pay the current monthly
deduction and a Grace Period expires without sufficient payment.
While the Guaranteed Death Benefit Rider is in force, if on any Monthly
Anniversary the total premiums received less any Partial Surrenders and their
fees, less Outstanding Debt do not exceed the premiums required under the
Guaranteed Death Benefit Rider (See "Guaranteed Death Benefit", page 21), a
notice will be sent which will give the Policy Owner 61 days from the date
thereof to make additional payments needed to maintain the Rider. See "Grace
Period and Lapse", page 27.
The Guaranteed Death Benefit Rider is not available on Policies offered or
issued for delivery to residents of certain states, and, therefore, in any such
states, Grace Period and Lapse will be treated as if the Guaranteed Death
Benefit Rider is not in effect. See "Grace Period and Lapse", page 27.
CHARGES AND DEDUCTIONS
Deductions from Premiums
Certain charges are deducted from each premium payment under a Policy prior
to applying the net premium to the Fund Value. These charges consist of the
following items:
Sales Charge -- A charge in each of the first ten Policy years equal to 6%
of the premiums paid up to the Target Premium in each year and 3% of premium
paid in excess of the Target Premium in each year. The Sales Charge is equal to
3% of all premiums after the tenth Policy year.
Tax Charge -- A state and local premium tax charge, currently equal to
2.25% of each premium, and a charge related to the federal tax treatment of
deferred acquisition costs currently equal to 1.50% of each premium will be
deducted to compensate the Company for these taxes. Actual state and local
premium taxes vary, ranging from 0% to 4%. The Company does not expect to make a
profit from this charge. (See "Tax Charges", page 30.)
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Daily Deduction from the Variable Account
A charge is deducted from the Variable Account each day for the Mortality
and Expense Risk Charge as described below.
Mortality and Expense Risk Charge -- A charge is deducted daily from each
Subaccount of the Variable Account for mortality and expense risks assumed by
the Company. This daily charge is equal to .000959% of the amount in the
Subaccount, which is equivalent to an annual rate of .35% of Subaccount value.
Deductions from Fund Value
A charge called the Monthly Deduction is deducted from the Fund Value on
each Monthly Anniversary Day. The Monthly Deduction consists of the following
items:
Cost of Insurance -- This monthly charge compensates the Company for
providing life insurance coverage for the Insureds. The amount of the charge is
equal to a current cost of insurance rate for each Insured multiplied by the net
amount at risk under the Policy at the beginning of each Policy Month.
Administrative Charge -- An administrative charge is a flat fee deducted
each month. This charge is $7.50 per month for all years.
Per $1,000 Specified Amount Charge -- The Company will deduct a per $1,000
Specified Amount charge from the Fund Value each month for the first 10 Policy
years following issue or an increase in Specified Amount. The charge varies
based on the issue age, underwriting class and smoking status of the younger
Insured. See Appendix A.
Guaranteed Death Benefit Charge -- If the Guaranteed Death Benefit Rider
has been elected, a charge of $0.01 per thousand of Policy Specified Amount and
certain Rider amounts per month will be charged during the Guarantee Period. The
Guaranteed Death Benefit Rider is not available on Policies offered or issued
for delivery to residents of the Commonwealth of Massachusetts or the States of
New Jersey and Texas.
Optional Insurance Benefits Charges -- The Monthly Deduction will include
charges for any other optional insurance benefits added to the Policy by Rider.
Surrender Charge
The Company will assess a Surrender Charge against Fund Value upon full
surrender of a Policy. The Surrender Charge is based on a factor per $1,000 of
initial Specified Amount. Starting on the first anniversary, the charge
decreases from its maximum by 10% per year until it reaches zero at the end of
the 10th policy year. The Surrender Charge targets at issue vary by Specified
Amount, issue age, gender and underwriting class. The grading percentages vary
based on issue age and number of full years since the Policy was issued. See
"Surrender Charge", page 31.
Transaction and Other Charges
A Partial Surrender Fee of $10 will be assessed against the remaining Fund
Value for any Partial Surrender. In addition, the Company reserves the right to
charge a fee of $25 for each transfer of Fund Value.
The operating expenses of the Variable Account are paid by the Company and
certain charges, deductions, and fees are made or imposed to compensate the
Company for these expenses and for the risk that the charges, deductions, and
fees may not be sufficient to compensate the Company. Investment advisory fees
and operating expenses of the Fund are paid by the Fund. For a description of
these charges, see "Charges and Deductions," page 29.
TAX TREATMENT OF INCREASES IN FUND VALUE
The Fund Value under the Policy is currently subject to the same federal
income tax treatment as the cash value under fixed life insurance. Therefore,
generally the Policy Owner will not be deemed to be in constructive receipt of
the Fund Value unless and until the Policy Owner is deemed to be in receipt of a
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distribution from the Policy. For information on the tax treatment of the Policy
and on the tax treatment of a Full Surrender, a Partial Surrender, or a Policy
loan, see "Federal Income Tax Considerations," page 34.
TAX TREATMENT OF DEATH BENEFIT
The Death Benefit under the Policy is currently subject to federal income
tax treatment consistent with that of fixed life insurance. Therefore, generally
the Death Benefit will be fully excludable from the gross income of the
Beneficiary under the Internal Revenue Code. See "Federal Income Tax
Considerations," page 34.
THE GUARANTEED INTEREST ACCOUNT
The Policy Owner may allocate all or a portion of net premium payments and
transfer Fund Value to the Guaranteed Interest Account, within specified limits.
Amounts allocated to the Guaranteed Interest Account are held in the Company's
General Account. The Company guarantees that the Fund Value allocated to the
Guaranteed Interest Account will be credited interest daily at a rate equivalent
to an effective annual rate of 4.5%. In addition, the Company may in its sole
discretion pay interest in excess of the guaranteed amount. See "The Guaranteed
Interest Account," page 40.
CONTACTING THE COMPANY
All written requests, notices, and forms required by the Policies, and any
questions or inquiries should be directed to the Company's Operations Center at
1 MONY Plaza, Syracuse, New York 13202.
INFORMATION ABOUT THE COMPANY AND THE VARIABLE ACCOUNT
MONY LIFE INSURANCE COMPANY OF AMERICA
MONY Life Insurance Company of America (the "Company") is a stock life
insurance company organized in the State of Arizona. The Company is currently
licensed to sell life insurance and annuities in 49 states (not including New
York), the District of Columbia, the U.S. Virgin Islands, and Puerto Rico. The
Company is the corporate successor of Vico Credit Life Insurance Company,
incorporated in Arizona on March 6, 1969.
The Company is a wholly-owned subsidiary of MONY Life Insurance Company
("MONY"). MONY was organized as a mutual life insurance company under the laws
of the State of New York in 1842. MONY converted to a stock life insurance
company in November 1998 through demutualization and assumed its present name at
that time. In addition, MONY became a wholly-owned subsidiary of The MONY Group
Inc. at that time. The principal office of MONY is located at 1740 Broadway, New
York, New York 10019. This conversion will not have any material effect on the
Company, the MONY America Variable Account L, or the Policies.
At November 1, 1998, the rating assigned to the Company by A. M. Best
Company, Inc., an independent insurance company rating organization, was A-
(Excellent) based upon an analysis of financial condition and operating
performance through the end of 1997. At the same date, MONY was rated A-
(Excellent) on the same basis. The A. M. Best rating of the Company should be
considered only as bearing on the ability of the Company to meet its obligations
under the Policies.
The Company has a service agreement with MONY whereby MONY provides the
Company with such personnel, facilities, etc., as are reasonably necessary for
the conduct of the Company's business. These services are provided on a cost
reimbursement basis. The Company intends to administer the Policies itself,
utilizing the services provided by MONY to meet its obligations under the
Policies.
MONY Securities Corp., a wholly owned subsidiary of MONY, is the principal
underwriter for the Policies.
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YEAR 2000 ISSUE
The Year 2000 issue is the result of widespread use of computer programs
which use two digits (rather than four) to define the applicable year. Such
programming was a common industry practice designed to avoid the significant
costs associated with additional mainframe computer capacity which would have
been necessary to accommodate a four digit year field. As a result, any of the
Company's computer systems that have time-sensitive software may recognize a
date using "00" as the year 1900 rather than the year 2000. This could result in
a major system failure or in miscalculations.
The Company has conducted a comprehensive review of its computer systems to
identify the systems that could be affected by the "Year 2000" issue and has
developed and implemented a plan to resolve the issue. The Company currently
believes that, with modifications to existing software and converting to new
software, the Year 2000 problem will not pose significant operational problems
for the Company's computer systems. However, if such modifications and
conversions are not completed on a timely basis, the Year 2000 problem may have
a material impact on the operations of the Company. Further, even if the Company
completes such modifications and conversions, there can be no assurance that the
failure by vendors or other third parties to solve the Year 2000 problem will
not have a material impact on the operations of the Company.
MONY Series Fund and the Accumulation Trust have reviewed with their
respective investment advisers and other suppliers of services the status of
their Year 2000 issue. MONY Series Fund and the Accumulation Trust prospectuses,
which are included in the Prospectus Portfolio, contain the results of those
status reviews. See MONY Series Fund prospectus at page 20; Accumulation Trust
prospectus at page 23.
MONY AMERICA VARIABLE ACCOUNT L
The MONY America Variable Account L (the "Variable Account") is a separate
investment account of the Company and at present is used only to support
flexible premium variable life insurance policies. The assets in the Variable
Account are kept separate from the General Account assets and other separate
accounts of the Company.
The Company owns the assets in the Variable Account and is required to
maintain sufficient assets in the Variable Account with a total market value
equal to the Policy liabilities funded by the Variable Account. The Variable
Account is divided into subdivisions called Subaccounts. The income, gains, or
losses, realized or unrealized, of the Variable Account are credited to or
charged against the assets held in the Variable Account without regard to the
other income, gains, or losses of the Company. Assets in the Variable Account
attributable to the reserves and other liabilities under the Policies are not
chargeable with liabilities arising from any other business that the Company
conducts. Assets held in the Company's General Account, including Fund Values of
the Policy during the Right to Return Period and Fund Values allocated by the
Policy Owner to the Guaranteed Interest Account, are subject to liabilities
arising from the business the Company conducts. However, the Company may
transfer to its General Account any assets which exceed anticipated obligations
of the Variable Account. All obligations arising under the Policy are general
corporate obligations of the Company. The Company may accumulate in the Variable
Account proceeds from various Policy charges and investment results applicable
to those assets.
The Variable Account was established on March 27, 1987 under Arizona law
under the authority of the Board of Directors of Company. The Variable Account
is registered as a unit investment trust with the SEC. Such registration does
not involve any supervision by the SEC of the administration or investment
practices or policies of the Account.
There are currently fourteen Subaccounts within the Variable Account
available to the Policyholder. Each Subaccount invests exclusively in shares of
a designated Portfolio of the Funds. For example, the Long Term Bond Subaccount
invests solely in shares of the MONY Series Fund, Inc. Long Term Bond Portfolio.
These Portfolios are available to serve only as the underlying investment for
variable annuity and variable life insurance contracts issued through separate
accounts of the Company as well as other life insurance companies, and may be
available to certain pension accounts. They are not available directly to
individual investors. The Company may in the future establish additional
Subaccounts within the Variable Account,
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which may invest in other Portfolios of the Funds or in other securities. Not
all Subaccounts are available to the Policy Owner.
THE FUNDS
Each Subaccount of the Variable Account currently invests only in shares of
a corresponding Portfolio of the MONY Series Fund, Inc. (the "MONY Series Fund")
or the Enterprise Accumulation Trust (the "Accumulation Trust") (the MONY Series
Fund and the Accumulation Trust are collectively called the "Funds"). The Funds
are diversified, open end management investment companies of the series type.
The Funds are registered with the SEC under the Investment Company Act of 1940.
Such registration does not involve supervision by the SEC of the investments or
investment policy of the Funds.
Of the seven separate Portfolios of the MONY Series Fund, currently only
four portfolios ("Portfolios"), each of which pursues different investment
objectives and policies, are available for purchase by corresponding Subaccounts
of the Variable Account available to the Policy Owner. The Company acts as the
investment manager of the MONY Series Fund. The Company is a registered
investment adviser under the Investment Advisers Act of 1940. As investment
adviser to the MONY Series Fund, the Company receives a daily investment
advisory fee equivalent to an annual rate of 0.50 percent of the first $400
million, 0.35 percent of the next $400 million, and 0.30 percent in excess of
$800 million of the aggregate average daily net assets of the Government
Securities, Long Term Bond, and Intermediate Term Bond Portfolios of the MONY
Series Fund, and 0.40 percent of the first $400 million, 0.35 percent of the
next $400 million, and 0.30 percent of assets in excess of $800 million of the
aggregate average daily net assets of the Money Market Portfolio of the MONY
Series Fund, as described in the accompanying current prospectus for the MONY
Series Fund. The Company, as investment adviser, has agreed to bear all expenses
associated with organizing the Fund, the initial registration of its securities,
and the compensation of the Fund's directors, officers and employees who are
interested persons of the Company. All other expenses will be borne by the Fund
itself, including, without limitation, the calculation of the net asset value of
the Portfolios. The Company has entered into a Services Agreement with MONY for
the provision of personnel, equipment, facilities and other services, in order
to carry out its duties as investment adviser to the Fund.
Of the ten separate Portfolios of the Accumulation Trust, currently all
separate Portfolios, each of which pursues different investment objectives and
policies, are available for purchase by corresponding Subaccounts of the
Variable Account. Enterprise Capital Management, Inc., a wholly-owned subsidiary
of MONY, ("Enterprise Capital") acts as the investment manager of the
Accumulation Trust. Enterprise Capital, as investment adviser to the
Accumulation Trust, will receive from the Accumulation Trust monthly
compensation with respect to the Equity and Managed Portfolios that it advises
at an annual rate of 0.80 percent of the first $400 million of the aggregate
average daily net assets of those portfolios, 0.75 percent of the next $400
million of the aggregate average daily net assets of those portfolios, and 0.70
percent of the aggregate average daily net assets of those portfolios which
exceed $800 million. OpCap Advisors, a subsidiary of Oppenheimer Capital, as the
sub-investment adviser to the Equity and Managed Portfolios of the Accumulation
Trust, will receive, from Enterprise Capital and not the Accumulation Trust,
0.40 percent (0.30 percent of assets in excess of $1 billion) of the aggregate
average daily net assets of the Equity Portfolio and 0.40 percent (0.30 percent
of the next $1 billion of assets, and 0.25% of assets in excess of $2 billion)
of the average daily net assets of the Managed Portfolio. Enterprise Capital, as
investment adviser to the Accumulation Trust, will receive from the Accumulation
Trust, .75 percent of the aggregate average daily net assets of the Equity
Income Portfolio, and 1740 Advisers, Inc. will receive from Enterprise Capital
and not the Accumulation Trust 0.30 percent (0.25 percent of the next $100
million of assets, and 0.20 percent of assets in excess of $200 million) of the
aggregate average daily net assets of the Equity Income Portfolio. Enterprise
Capital, as investment adviser to the Accumulation Trust, will receive from the
Accumulation Trust, .75 percent of the aggregate average daily net assets of the
Growth and Income Portfolio, and Retirement System Investors, Inc. will receive
from Enterprise Capital and not the Accumulation Trust 0.30 percent (0.25
percent of the next $100 million of assets, and 0.20 percent of assets in excess
of $200 million) of the aggregate average daily net assets of the Growth and
Income Portfolio. Enterprise Capital, as investment adviser to the Accumulation
Trust, will receive from the Accumulation Trust, .75 percent of the aggregate
average daily net assets of the
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Growth Portfolio, and Montag & Caldwell, Inc. will received from Enterprise
Capital and not the Accumulation Trust 0.30 percent (0.20 percent of assets in
excess of $1 billion) of the aggregate average daily net assets of the Growth
Portfolio. Enterprise Capital, as investment adviser to the Accumulation Trust,
will receive from the Accumulation Trust, .75 percent of the aggregate average
daily net assets of the Capital Appreciation Portfolio, and Provident Investment
Counsel, Inc. will receive from Enterprise Capital and not the Accumulation
Trust 0.50 percent of the first $100 million (0.45 percent of the next $100
million of assets, 0.35 percent of next $100 million of assets, and 0.30 percent
of assets in excess of $300 million) of the aggregate average daily net assets
of the Capital Appreciation Portfolio. Enterprise Capital, as investment adviser
to the Accumulation Trust, will receive from the Accumulation Trust, 1.00
percent of the aggregate average daily net assets of the Small Company Growth
Portfolio, and William D. Witter, Inc will receive from Enterprise Capital and
not the Accumulation Trust 0.65 percent (0.55 percent of the next $50 million of
assets, and 0.45 percent of assets in excess of $100 million) of the aggregate
average daily net assets of the Small Company Growth Portfolio. Enterprise
Capital, as investment adviser to the Accumulation Trust, will receive from the
Accumulation Trust monthly compensation with respect to the Small Company Value
Portfolio that it advises at an annual rate of 0.75 percent of the aggregate
average daily net assets of the Small Company Value Portfolio. Gabelli Asset
Management, as sub-investment adviser to the Small Company Value Portfolio of
the Accumulation Trust, will receive from Enterprise Capital and not the
Accumulation Trust, 0.40 percent (0.30 percent of assets in excess of $1
billion) of the aggregate average daily net assets of the Small Company Value
Portfolio. Enterprise Capital, as investment adviser to the Accumulation Trust,
will receive from the Accumulation Trust monthly compensation with respect to
the International Growth Portfolio that it advises at an annual rate of 0.85
percent of the aggregate average daily net assets of the International Growth
Portfolio, and Brinson Partners, Inc., as the sub-investment adviser to the
International Growth Portfolio, will receive from Enterprise Capital and not the
Accumulation Trust, 0.45 percent (53% of the fee received by Enterprise Capital,
the fee paid to Brinson Partners declines as assets exceed $100 million) of the
aggregate average daily net assets of the International Growth Portfolio.
Enterprise Capital, as investment adviser to the Accumulation Trust, will
receive from the Accumulation Trust monthly compensation with respect to the
High Yield Bond Portfolio that it advises at an annual rate of 0.60 percent of
the aggregate average daily net assets of the High Yield Bond Portfolio, and
Caywood-Scholl Capital Corporation, as sub-investment adviser to the High Yield
Bond Portfolio, will receive from Enterprise Capital and not the Accumulation
Trust, 0.30 percent (0.25 percent for assets in excess of $100 million) of the
aggregate average daily net assets of the High Yield Bond Portfolio.
The investment objectives of each Portfolio are fundamental and may not be
changed without the approval of the holders of a majority of the outstanding
shares of the Portfolio affected (which, for each of the Funds, means the lesser
of (1) 67 percent of the Portfolio shares represented at a meeting at which more
than 50 percent of the outstanding Portfolio shares are represented or (2) more
than 50 percent of the outstanding Portfolio shares).
PURCHASE OF PORTFOLIO SHARES BY THE VARIABLE ACCOUNT
The shares of each Portfolio are purchased by the Company for the
corresponding Subaccount at net asset value, i.e., without sales load. All
dividends and capital gains distributions received from a Portfolio are
automatically reinvested in such Portfolio at net asset value, unless the
Company, on behalf of the Variable Account, elects otherwise. Fund shares will
be redeemed by the Company at their net asset value to the extent necessary to
make payments under the Policies.
Shares of the Funds are offered only for purchase by separate accounts of
insurance companies, which may or may not be affiliated with the Company, or
with each other. This is called "shared funding." They may also sell shares to
separate accounts to serve as an investment medium for variable life insurance
policies and for variable annuity contracts. Thus, the Funds serve as an
investment medium for both variable life insurance policies and variable annuity
contracts. This is called "mixed funding." The Company currently does not
foresee any disadvantages to Policy Owners arising from either mixed or shared
funding; however, due to differences in tax treatment or other considerations,
it is theoretically possible that the interests of owners of various contracts
for which the Funds serve as an investment medium might at some time be in
conflict.
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<PAGE> 17
However, the Company's and the MONY Series Fund's Boards of Directors, the
Accumulation Trust's Board of Trustees, and any other insurance companies that
participate in the Funds are required to monitor events in order to identify any
material conflicts that arise from the use of the Funds for mixed and/or shared
funding. The Funds' Boards are required to determine what action, if any, should
be taken in the event of such a conflict. If such a conflict were to occur, the
Company might be required to withdraw the investment of one or more of its
separate accounts from the Funds. This might force the Funds to sell securities
at disadvantageous prices.
A summary of the investment objective of each of the Portfolios of the
Funds is described below. There can be no assurance that any Portfolio will
achieve its objective. More detailed information is contained in the
accompanying prospectus of each Fund, including information on the risks
associated with the investment and investment techniques of each of the
Portfolios.
THE FUNDS' PROSPECTUSES ACCOMPANY THIS PROSPECTUS AND SHOULD BE
READ CAREFULLY BEFORE INVESTING.
The Money Market Portfolio
The investment objective of the Money Market Portfolio is to seek maximum
current income consistent with preservation of capital and maintenance of
liquidity. The Money Market Portfolio attempts to achieve this objective by
investing in money market instruments. MONY Series Fund offers this Portfolio.
The Government Securities Portfolio
The investment objective of the Government Securities Portfolio is the
maximum current income over the intermediate term consistent with the
preservation of capital, through investment in highly-rated debt securities,
U.S. Government obligations, and money market instruments, with a dollar
weighted average life of up to ten years at the time of purchase. MONY Series
Fund offers this Portfolio.
The Intermediate Term Bond Portfolio
The investment objective of the Intermediate Term Bond Portfolio is to
maximize income over the intermediate term consistent with the preservation of
capital. The Portfolio seeks to achieve this objective by investing in highly
rated debt securities, U.S. Government obligations, and money market
instruments, together having a dollar-weighted average life of between 4 and 8
years. MONY Series Fund offers this Portfolio.
The Long Term Bond Portfolio
The investment objective of the Long Term Bond Portfolio is to maximize
income over the longer term consistent with preservation of capital. The
Portfolio seeks to achieve its objective by investing in highly-rated debt
securities, U.S. Government obligations, and money market instruments, together
having a dollar-weighted average life of more than 8 years. MONY Series Fund
offers this Portfolio.
The Equity Income Portfolio
The Equity Income Portfolio invests in a combination of growth and income
to achieve an above average and consistent total return, primarily from
investments in dividend-paying common stocks. The Accumulation Trust offers this
Portfolio.
The Growth and Income Portfolio
The Growth and Income Portfolio seeks total return in excess of the total
return of the Lipper Growth and Income Mutual Funds Average measured over a new
period of three to five years, by investing in a broadly diversified group of
large capitalization stocks. The Accumulation Trust offers this Portfolio.
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<PAGE> 18
The Growth Portfolio
The investment objective of the Growth Portfolio is capital appreciation,
primarily from investments in common stocks. The Accumulation Trust offers this
Portfolio.
The Equity Portfolio
The investment objective of the Equity Portfolio is long-term capital
appreciation. The Portfolio seeks to achieve this investment objective by
investing in a diversified portfolio of primarily equity securities selected on
the basis of a value-oriented approach to investing. The Accumulation Trust
offers this Portfolio.
The Capital Appreciation Portfolio
The investment objective of the Capital Appreciation Portfolio is maximum
capital appreciation, primarily through investment in common stock of companies
that demonstrate accelerating earnings momentum and consistently strong
financial characteristics. The Accumulation Trust offers this Portfolio.
The Managed Portfolio
The investment objective of the Managed Portfolio is to provide growth of
capital over time. The Portfolio seeks to achieve this investment objective by
investing in a portfolio consisting of common stocks, bonds and cash
equivalents, the percentage of which will vary over time based on the investment
manager's assessment of the relative investment values. The Accumulation Trust
offers this Portfolio.
The Small Company Growth Portfolio
The investment objective of the Small Company Growth Portfolio is capital
appreciation by investing primarily in common stocks of small capitalization
companies believed by the Portfolio Manager to have an outlook for strong
earnings growth and potential for significant capital appreciation. The
Accumulation Trust offers this Portfolio.
The Small Company Value Portfolio
The Small Company Value Portfolio seeks capital appreciation. The Portfolio
pursues its investment objective by investing in a diversified portfolio of
primarily equity securities of companies with market capitalization of under $1
billion. The Accumulation Trust offers this Portfolio.
The International Growth Portfolio
The investment objective of the International Growth Portfolio is to
provide capital appreciation, primarily through a diversified portfolio of
non-United States equity securities. The Accumulation Trust offers this
portfolio.
The High Yield Bond Portfolio
The investment objective of the High Yield Bond Portfolio is to provide
maximum current income, primarily from debt securities that are rated Ba or
lower by Moody's Investors Service, Inc. or BB or lower by Standard & Poor's
Corporation. The Accumulation Trust offers this portfolio.
THE POLICY
The variable life insurance benefits of the Policies are funded through the
Policy Owner's Fund Value in the Variable Account and the Guaranteed Interest
Account. The information included below describes the benefits, features,
charges, and other major provisions of the Policies.
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APPLICATION FOR A POLICY
The Policy is designed to meet the insurance needs of individuals by
providing life insurance coverage on two Insureds, with a death benefit payable
when the last surviving Insured dies while the Policy is in effect. Applicants
wishing to purchase the Policy must complete an application and personally
deliver it to a licensed agent of the Company, who is also a registered
representative of MONY Securities Corp. ("MSC"). The licensed agent will then
submit the completed application to the Company. The Policy may also be sold
through other broker-dealers authorized by MSC and applicable law to do so. A
Policy can be issued on the lives of two Insureds, each of which is no older
than Age 85 with evidence of insurability satisfactory to the Company. Each
Insured's Age is calculated as of the Insured's last birthday prior to the
Policy Date. Acceptance is subject to the Company's underwriting rules, and the
Company reserves the right to request additional information and to reject an
application.
The minimum Specified Amount which may be applied for is $100,000.
Subsequent to issue, the minimum Specified Amount is also $100,000. However, the
Company also reserves the right to revise its rules from time to time to specify
a different minimum Specified Amount at issue or thereafter for subsequent
issued Policies.
Each Policy is issued with a Policy Date, which is the date used to
determine the Monthly Anniversary Day, Policy Months, Policy years, and Policy
monthly, quarterly, semiannual and annual anniversaries. The Policy Date will be
stated on Page 1 of the Policy. The Policy Date will normally be the later of
the date that delivery of the Policy is authorized by the Company (the "Policy
Release Date") or the Policy Date requested in the application. Except as
provided under the temporary insurance procedures defined below, no premiums may
be paid with the application.
Temporary Insurance Coverage
If an applicant desires interim last survivor insurance coverage on the
lives of the proposed Insureds prior to the Policy Release Date, a Temporary
Insurance Agreement is available. At the time an application is accepted by a
licensed agent of the Company, the applicant must satisfactorily complete and
sign the Temporary Insurance Agreement Form and submit payment for at least one
Minimum Monthly Premium for the Policy as applied for. Coverage commences under
the Temporary Insurance Agreement on the date the Temporary Insurance Agreement
Form is signed and the required premium amount has been paid, or if later, the
requested Policy Date. See "Premium Flexibility," page 16.
Once the coverage under the Temporary Insurance Agreement commences, it
generally will run until the Policy Release Date, but in no event for more than
90 days from the date the Temporary Insurance Agreement Form is signed. In
addition, this temporary insurance coverage will also cease on the earliest of
(a) the 45th day after the Temporary Insurance Agreement Form is signed if the
last of the medical exams and tests initially required under the Company's
published underwriting rules have not been completed by the Insureds, (b) 5 days
after the Company sends notice to the applicant that it declines to issue any
Policy, (c) the date the applicant informs the Company that the Policy will be
refused, (d) the Policy Release Date, if the Policy is issued as applied for, or
(e) where the Policy is issued other than as applied for, the earlier of the
15th day after the Policy Release Date or the date the Policy takes effect. If
the deaths of both Insureds occur during the period of temporary coverage, the
Death Benefit will be (i) the lesser of $500,000 or the insurance coverage
applied for on the lives of the Insureds (including any optional Riders), less
(ii) the Deductions from Premium and the Monthly Deduction due prior to the date
of death of the last surviving Insured.
During the period before the Policy Release Date, premiums paid with the
application pursuant to the Temporary Insurance Agreement will be held in the
Company's General Account. Except as provided below, interest will be credited
on the premium (less any deductions from premiums) held in the Company's General
Account. The interest rate will be set by the Company, but will not be less than
4.5 percent per year. If the
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<PAGE> 20
Policy is issued and accepted, these amounts will be applied to the Policy.
These premiums will be returned (without interest) to the applicant within 5
days after:
(1) the date the applicant informs the Company at or before the Policy
Release Date (or where the Policy is authorized for delivery other than as
applied for, on or before the 15th day after the Policy Release Date) that
the Policy will be refused; or
(2) the date which is 30 days after the application is signed, if any
medical exams or tests required by the Company have not yet been completed;
or
(3) the Company sends notice to the applicant declining to issue any
Policy on the Insureds.
Initial Premium Payment
If the application is approved and the Policy is subsequently issued, the
balance due (if any) of the first Scheduled Premium Payment, as specified in the
Policy, is payable upon delivery of the Policy. The Policy will take effect on
the date the Policy is accepted by the applicant and the initial Scheduled
Premium Payment has been paid, or the Policy Date requested in the application,
if later. If a specific Policy Date has not been requested or if the Policy Date
requested is prior to the Policy Release Date, upon receipt of the balance due
(if any), the amount attributable to the Policy (including any premiums held in
the General Account under the Temporary Insurance Agreement plus any interest
credited in the General Account, less the applicable deductions from premiums)
will earn interest at a rate set by the Company, but not less than 4.5% per year
from the Policy Release Date pending expiration of the applicable Right to
Return Policy Period. These amounts will be held in the Company's General
Account. The Monthly Deduction due prior to or on the Policy Release Date will
be made. Upon expiration of the Right to Return Policy Period, amounts to be
allocated to the Subaccounts of the Variable Account will be allocated to those
Subaccounts and amounts to be allocated to the Guaranteed Interest Account will
be allocated to that Account. (See "Right to Examine A Policy -- Right to Return
Policy Period," page 16.)
Policy Date
If a specific Policy Date has been requested which is later than the Policy
Release Date, the amount attributable to the Policy will be initially held in
the General Account until the Policy Date. On the Policy Date, the amount
attributable to the Policy less any deductions from premiums for the period
commencing with the Policy Date will be held in the Company's General Account
and will earn interest at a rate set by the Company, but not less than 4.5% per
year pending expiration of the applicable Right to Return Policy Period. Upon
the expiration of the applicable Right to Return Policy Period, amounts
allocated to the Subaccounts of the Variable Account will be allocated to those
Subaccounts and amounts allocated to the Guaranteed Interest Account will be
allocated to that Account. See "Right to Examine A Policy -- Right to Return
Policy Period," page 16.
Subject to the Company's approval, a Policy may be backdated, but the
Policy Date may not be more than six months (a shorter period is required in
certain states) prior to the date of the application. Backdating can be
advantageous if either of the Insured's lower issue Age results in lower cost of
insurance rates. If the Policy is backdated, the initial Scheduled Premium
Payment will include sufficient premium to cover additional charges incurred for
the backdating period, since monthly deductions are made for the period the
Policy Date is backdated.
Risk Classifications
Each Insured is assigned to an underwriting (risk) class that is used in
calculating the cost of insurance and certain Rider charges. In assigning
Insureds to underwriting classes, the Company will normally use the medical or
paramedical underwriting method, which may require a medical examination of each
proposed Insured, although other forms of underwriting may be used when deemed
appropriate by the Company.
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<PAGE> 21
RIGHT TO EXAMINE A POLICY -- RIGHT TO RETURN POLICY PERIOD
The Right to Return Policy Period follows the application for the Policy
and its issuance to the Policy Owner. The period runs to 10 days (or longer in
certain states) after the Policy Owner receives the Policy. During the Right to
Return Policy Period which follows the issuance of the Policy, the Policy Owner
may cancel the Policy and receive a refund of the full amount of the premium
paid. During the Right to Return Policy Period, net premiums will be held in the
Company's General Account and will earn interest at a rate set by the Company,
but not less than 4.5% per year. See "Allocation of Net Premiums," page 18.
PREMIUMS
The Policy is a flexible premium policy, and it provides considerable
flexibility, subject to the limitations described below, to pay premiums at the
Policy Owner's discretion.
Premium Flexibility
The Company requires a Policy Owner to pay an amount equal to at least the
Minimum Monthly Premium to place the Policy in force. If the premiums are to be
paid less often than monthly, the premium required to place the Policy in force
is equal to the Minimum Monthly Premium multiplied by 12 divided by the
frequency of Scheduled Premium Payments. This Minimum Monthly Premium will be
based upon the Policy's Specified Amount and the Age, smoking status, gender
(unless unisex cost of insurance rates apply, see "Cost of Insurance," page 30),
and underwriting class of each of the Insureds, and any Riders added to the
Policy. The Minimum Monthly Premium will be shown in the Policy. Thereafter,
subject to the limitations described below, a Policy Owner may choose the amount
and frequency of premium payments. The Policy, therefore, provides the Policy
Owner with the flexibility to vary premium payments to reflect varying financial
conditions.
If on each Monthly Anniversary Day during the first three Policy years, the
sum of all premiums paid, less any Outstanding Debt and less any Partial
Surrenders (and their fees), is greater than or equal to the Minimum Monthly
Premium times the number of completed Policy months or the Policy's Cash Value
is greater than zero, the Policy is guaranteed not to lapse. If an increase in
Specified Amount occurs during the first three Policy years, the minimum Monthly
Premium requirement is increased following the effective date of the increase
and applies until the end of the first three Policy years. See "Grace Period and
Lapse", page 27.
Scheduled Premium Payments (Planned Premium Payments)
When applying for a Policy, a Policy Owner will determine a Scheduled
Premium Payment that provides for the payment of level premiums at fixed
intervals over a specified period of time. Each Policy Owner will receive a
premium reminder notice for the Scheduled Premium Payment amount on an annual,
semiannual, or quarterly basis, at the option of the Policy Owner. The minimum
Scheduled Premium Payment is equal to the Minimum Monthly Premium multiplied by
12 divided by the Scheduled Premium Payment frequency. Although reminder notices
will be sent, the Policy Owner may not be required to pay Scheduled Premium
Payments. (For Policies offered or issued for delivery in the Commonwealth of
Massachusetts, the Policy Owner will determine a Planned Premium Payment that
provides for the payment of level premiums at selected intervals over a
specified period of time. For those Policy Owners, the term "Scheduled Premium
Payments" used in this Prospectus, refers to Planned Premium Payments.)
Premiums, other than the first, may also be paid monthly under the
Electronic Funds Transfer plan where the Policy Owner authorizes the Company to
withdraw premiums from the Owner's checking account each month. Based on the
Policy Date, up to two Minimum Monthly Premiums may be required to be paid in
cash before the Electronic Funds Transfer plan will be accepted by the Company.
Payment of the Scheduled Premium Payments will not guarantee that a Policy will
remain in force. Instead, unless the Guaranteed Death Benefit Rider has been
elected and all requirements have been met, the duration of the Policy depends
upon the Policy's Cash Value. However, in addition during the first three Policy
years, if on each Monthly Anniversary Day the sum of premiums paid, less the sum
of Partial Surrenders (and any fees relating thereto)
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<PAGE> 22
and any Outstanding Debt is greater than or equal to the Minimum Monthly Premium
times the number of completed Policy Months or the Policy's Cash Value is
greater than zero, the Policy is guaranteed not to lapse. If an increase in
Specified Amount occurs during the first three Policy years, the Minimum Monthly
Premium requirement is increased following the date the increase took effect and
applies until the end of the first three Policy years. Even if the Scheduled
Premium Payments are made, if either of these two provisions do not apply, the
Policy will lapse any time the Cash Value is insufficient to pay the current
monthly deduction and a Grace Period expires without sufficient payment.
Choice of Tests for Compliance with IRS Definition of Life Insurance
When applying for a Policy, the applicant will irrevocably choose which of
the two tests for compliance with the Federal income tax law definition of life
insurance will apply to the Policy. These tests are the Cash Value Accumulation
Test and the Guideline Premium/Cash Value Corridor Test. See "Federal Income Tax
Considerations -- Definition of Life Insurance," page 34. If the Guideline
Premium/Cash Value Corridor Test is chosen, the premium payments that may be
made relative to the Policy may be limited.
Guaranteed Death Benefit Rider
When application for the Policy is made, the applicant will also have the
opportunity to choose the Guaranteed Death Benefit Rider, which may extend the
period that the Specified Amount of the Policy and certain Rider coverages will
remain in effect. The Guarantee Period continues to the younger Insured's Age 70
or ten years from the Policy Date, whichever is later (the "Guarantee Period").
An extra charge will be deducted from the Fund Value each month during the
Guarantee Period. See "Guaranteed Death Benefit," page 21.
In the event that on any Monthly Anniversary Day the Cash Value is less
than zero, the Guaranteed Death Benefit Rider will keep the Policy in force
provided that the cumulative Monthly Guarantee Premium due to date has been
paid. This amount depends on the Specified Amount of the Policy, the Insureds'
age, gender, smoking status and underwriting class, and any additional insurance
benefits added by Rider. Adding other optional insurance benefits by Rider to
the Policy will increase the Monthly Guarantee Premium indicated above.
It is important to consider the Guaranteed Death Benefit Rider premium
requirements when setting the amount of the Scheduled Premium Payments for the
Policy. (See Appendix D.)
The Guaranteed Death Benefit Rider is not available in all states.
Modified Endowment Contracts
The amount, frequency and period of time over which a Policy Owner pays
premiums may affect whether the Policy will be classified as a modified
endowment contract, which is a type of life insurance contract subject to
different tax treatment for certain pre-death distributions than conventional
life insurance contracts. See "Federal Income Tax Considerations -- Modified
Endowment Contracts," page 36.
Unscheduled Premium Payments
Generally, the Policy Owner can make unscheduled premium payments at any
time and in any amount. The Company may reject or limit any unscheduled premium
payment that would result in an immediate increase in the Death Benefit. A
premium payment would result in an immediate increase if the Death Benefit under
a Policy is equal to a Policy Owner's Fund Value multiplied by a death benefit
percentage as a result of the Federal income tax law definition of life
insurance. See "Death Benefits under the Policy," page 18 and "Federal Income
Tax Considerations -- Definition of Life Insurance," page 34. In addition, all
or a portion of a premium payment will be rejected and returned to the Policy
Owner if it would exceed the maximum premium limitations prescribed by the
Federal income tax law definition of life insurance.
Unscheduled premium payments will be treated as premium payments, and not
as a repayment of Outstanding Debt, unless a Policy Owner requests otherwise. If
the Policy Owner does request that the
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<PAGE> 23
payment be treated as a repayment of Outstanding Debt, any portion of a payment
that exceeds the amount of Outstanding Debt will be applied to the Fund Value.
Applicable taxes and sales charges are not deducted from payments used as a
repayment of Outstanding Debt, but are deducted from any payment which
constitutes a premium payment.
Premium Payments Affect the Continuation of the Policy
If premium payments are stopped, temporarily or permanently, the Policy
will continue in effect until the Cash Value can no longer cover the Monthly
Deductions from the Fund Value for the Policy and any optional insurance
benefits added by Rider. At that point, the Policy will lapse. See "Grace Period
and Lapse," page 27. If the Minimum Monthly Premium requirements are satisfied
during the first three Policy years or if the Cash Value is greater than zero,
the Policy is guaranteed not to lapse during this three year period. If an
increase in Specified Amounts occurs during the first three Policy years, if the
Minimum Monthly Premium requirements are satisfied during the first three Policy
years or if the Cash Value is greater than zero, the Policy is guaranteed not to
lapse during that period. See "Premiums -- Premium Flexibility," page 16. If the
Guaranteed Death Benefit Rider is in effect, the Specified Amount of the Policy
and certain Rider coverages will remain in force until the end of the Guarantee
Period if premium payments required by the Rider have been made. The Guaranteed
Death Benefit is not available in all states. See "Guaranteed Death Benefit,"
page 21.
Certain charges will be deducted from each premium payment. See "Charges
and Deductions," page 29. The remainder of the premium, referred to as the "net
premium", will be allocated as described below under "Allocation of Net
Premiums."
ALLOCATION OF NET PREMIUMS
In the application for the Policy, the Policy Owner selects the Subaccounts
of the Variable Account or the Guaranteed Interest Account to which net premium
payments will be allocated. During the Right to Return Policy Period, net
premiums will be held in the Company's General Account and will earn interest at
a rate set by the Company, but not less than 4.5% per year. The Fund Value will
be automatically allocated according to the Policy Owner's instructions
contained in the application at the end of the Right to Return Policy Period.
Net premiums received after the Right to Return Policy Period will be allocated
upon receipt among the Subaccounts of the Variable Account and the Guaranteed
Interest Account according to the Policy Owner's most recent instructions.
Net premiums may be allocated in whole percentages to any number of
Subaccounts and to the Guaranteed Interest Account, provided that no allocation
may be for less than 10% of a net premium. Allocation percentages must sum to
100%. Available allocation alternatives include the fourteen Subaccounts and the
Guaranteed Interest Account.
A Policy Owner may change the allocation of net premiums at any time by
submitting a proper written request to the Company's Administrative Office. In
addition, changes in net premium allocation instructions may be made by
telephone if an authorization for telephone transfer form has been properly
completed, signed and filed at the Company's Syracuse Operations Center. The
Company reserves the right to discontinue telephone net premium allocation
instructions. See "Telephone Transfer Privileges", page 45. The revised
allocation percentages will be applied within seven days from receipt of
notification.
Unscheduled premium payments may be allocated either by percentage or by
dollar amount. If the allocation is expressed in dollar amounts, the 10% limit
on allocation percentages does not apply.
DEATH BENEFITS UNDER THE POLICY
When the Policy is issued, the Company will determine the initial amount of
insurance based on the instructions provided in the application. That amount
will be shown on the specification page of the Policy and is called the
"Specified Amount". The minimum Specified Amount at issue is $100,000. The
Specified Amount is level until the Maturity Date unless increased or decreased
by the Policy Owner.
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<PAGE> 24
For so long as the Policy remains in force, the Company will, upon proof of
the death of both Insureds, pay death benefit proceeds to a named Beneficiary.
Death benefit proceeds will consist of the Death Benefit under the Policy, plus
any insurance proceeds provided by Rider, less any Outstanding Debt (and, if in
the Grace Period, further reduced by any overdue charges).
DEATH BENEFIT OPTIONS
Each Policy Owner may select one of two death benefit Options: Option 1 or
Option 2. Generally the applicant designates the death benefit Option in the
application. If no Option is designated, Option 2 will be assumed by the Company
to have been selected. Subject to certain restrictions, the Policy Owner can
change the death benefit Option selected. So long as the Policy remains in
force, the Death Benefit under either Option will never be less than the
Specified Amount of the Policy.
Option 1
Under Option 1, the Death Benefit will be equal to the Specified Amount of
the Policy on the date of death of the last surviving Insured or, if greater,
the Fund Value on the date of death of the last surviving Insured multiplied by
the death benefit percentage. The death benefit percentages vary according to
the Ages of the Insureds and will be equal to the percentage defined in the
Internal Revenue Code, which addresses the definition of a life insurance policy
for tax purposes. See "Federal Income Tax Considerations -- Definition of Life
Insurance," page 34. Policy Owners who are seeking to have favorable investment
performance reflected in increasing Fund Value, and not in increasing insurance
coverage, should choose Option 1.
Option 2
Under Option 2, the Death Benefit will be equal to the Specified Amount of
the Policy on the date of death of the last surviving Insured plus the Fund
Value on the date of death of the last surviving Insured or, if greater, the
Fund Value on the date of death of the last surviving Insured multiplied by the
death benefit percentage. The death benefit percentage is the same as that used
in connection with Option 1. The Death Benefit under Option 2 will always vary
as Fund Value varies. Therefore, Policy Owners who seek to have favorable
investment performance reflected in increased insurance coverage should choose
Option 2.
Under either Option 1 or Option 2, the death benefit percentages will
depend on the test for compliance with the Federal income tax law definition of
life insurance chosen at issue. The death benefit percentages under the Cash
Value Accumulation Test vary according to each Insured's Age, gender, premium
class. The death benefit percentages under the Guideline Premium/Cash Value
Corridor Test vary according to the Age of the younger Insured at the beginning
of the Policy Year of the last surviving Insured's death (whether or not the
younger Insured is the last surviving Insured). These percentages are specified
in the Policy.
Examples of Options 1 and 2
The following examples demonstrate the determination of Death Benefits
under Options 1 and 2. The examples show six Policies with the same Specified
Amount, but Fund Values that vary as shown, and which assume both Insureds are
age 35, standard class, non-smokers at issue, the last surviving Insured (also
the youngest Insured) is Age 70 at the time of death and that there is no
Outstanding Debt. The date of death is also assumed to be on a Monthly
Anniversary Day.
<TABLE>
<CAPTION>
CASH VALUE ACCUMULATION TEST POLICY 1 POLICY 2 POLICY 3
---------------------------- -------- -------- --------
<S> <C> <C> <C>
Specified Amount............................................ $100,000 $100,000 $100,000
Fund Value on Date of Last Surviving Insured's Death........ $ 35,000 $ 60,000 $ 90,000
Death Benefit Percentage.................................... 183.6% 183.6% 183.6%
Death Benefit under Option 1................................ $100,000 $110,160 $165,240
Death Benefit under Option 2................................ $135,000 $160,000 $190,000
</TABLE>
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<PAGE> 25
<TABLE>
<CAPTION>
GUIDELINE PREMIUM/CASH VALUE CORRIDOR TEST POLICY 4 POLICY 5 POLICY 6
------------------------------------------ -------- -------- --------
<S> <C> <C> <C>
Specified Amount............................................ $100,000 $100,000 $100,000
Fund Value on Date of Last Surviving Insured's Death........ $ 35,000 $ 60,000 $ 90,000
Death Benefit Percentage.................................... 115% 115% 115%
Death Benefit under Option 1................................ $100,000 $100,000 $103,500
Death Benefit under Option 2................................ $135,000 $160,000 $190,000
</TABLE>
Death Benefit proceeds may be paid to a Beneficiary in a lump sum or under
a payment plan offered under the Policy. The Policy should be consulted for
details.
Changes in Death Benefit Option
A Policy Owner may request that the death benefit Option under the Policy
be changed from Option 1 to Option 2, or from Option 2 to Option 1. Changes in
the death benefit Option may be made on any Monthly Anniversary Day and should
be made in writing to the Company's Administrative Office. A change from Option
2 to Option 1 may be made without evidence of insurability; a change from Option
1 to Option 2 will require evidence of insurability satisfactory to the Company.
The effective date of any such change requested between Monthly anniversaries
will be the next Monthly Anniversary Day after the change is accepted.
A change in the death benefit Option from Option 1 to Option 2 is
accomplished by reducing the Specified Amount of the Policy by the amount of the
Policy's Fund Value at the date of the change. This maintains the Death Benefit
payable under Option 2 at the amount that would have been payable under Option 1
immediately prior to the change. Although there is no immediate change in the
total Death Benefit, the change to Option 2 will affect the determination of the
Death Benefit from that point on since the Fund Value will then be added to the
new Specified Amount, and the Death Benefit will then vary with Fund Value. This
change will not be permitted if it would result in a new Specified Amount of
less than $100,000.
A change in the death benefit Option from Option 2 to Option 1 is
accomplished by increasing the Specified Amount of the Policy by the amount of
the Policy's Fund Value at the date of the change. This maintains the Death
Benefit payable under Option 1 at the amount that would have been payable under
Option 2 immediately prior to the change. Although there is no immediate change
in total Death Benefit, the change to Option 1 will affect the determination of
Death Benefit from that point on, the Death Benefit will equal the Specified
Amount (or, if higher, the Fund Value times the applicable death benefit
percentage, as required by the federal income tax law definition of life
insurance). The change to Option 1 will generally reduce the Death Benefit
payable in the future.
A change in death benefit Option may affect the monthly cost of insurance
charge since this charge varies with the net amount at risk, which generally is
the amount by which the Death Benefit exceeds Fund Value. See "Cost of
Insurance," page 30. Assuming that the Policy's Death Benefit is not based on
the death benefit percentage under either Option 1 or 2, changing from Option 2
to Option 1 will generally decrease the net amount at risk, and therefore
possibly decrease the cost of insurance charges. Changing from Option 1 to
Option 2 will generally result in a net amount at risk that remains level. Such
a change, however, will result in an increase in the cost of insurance charges
over time, since the cost of insurance rates increase with each Insured's Age.
CHANGES IN SPECIFIED AMOUNT
A Policy Owner may request an increase or decrease in the Specified Amount
under a Policy subject to approval from the Company. A change in Specified
Amount may be made at any time after issue. Increases in Specified Amount are
not permitted on or after the older Insured's Age 85 or the death of either
Insured and will not be permitted if monthly deductions are being waived under
the Waiver of Monthly Deductions Rider. Increasing the Specified Amount will
generally increase the death benefit payable under the Policy, and decreasing
the Specified Amount will generally decrease the death benefit payable. The
amount of change in the death benefit will depend, among other things, upon the
death benefit Option chosen by the Policy Owner and whether the death benefit
under the Policy is being calculated using the Death Benefit Percentage at the
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<PAGE> 26
time of the change. Changing the Specified Amount could affect the subsequent
level of the death benefit while the Policy is in force and the subsequent level
of Policy values. For example, an increase in Specified Amount may increase the
net amount at risk under a Policy, which will increase a Policy Owner's cost of
insurance charges over time. Conversely, a decrease in Specified Amount may
decrease the net amount at risk, which may decrease a Policy Owner's cost of
insurance charges over time. Changes must be made by written application to the
Company's Administrative Office. In addition, the Specified Amount remaining
after a decrease must not be less than $100,000. The change will become
effective on the Monthly Anniversary Day on or next following the Company's
acceptance of the request. If the Policy Owner is not one of the Insureds, the
Company may also require the consent of the Insureds before accepting a request.
Increases
Additional evidence of insurability satisfactory to the Company will be
required for an increase in Specified Amount.
A requested increase in the Specified Amount will create a new "coverage
segment" for which cost of insurance and other charges will be computed
separately. See "Charges and Deductions," page 29. In addition, the Surrender
Charge associated with the Policy will increase. The Surrender Charge for the
increase is calculated in a similar manner as for the original Specified Amount.
The Minimum Monthly Premium and the required premiums under the Guaranteed Death
Benefit Rider, if applicable, will also be adjusted prospectively to reflect the
increase in Specified Amount. If the Specified Amount is increased at the same
time that a premium payment is received, the increase will be processed before
the premium payment is processed.
If an increase creates a new coverage segment of Specified Amount, Fund
Value after the increase will be allocated to the original coverage segment
first, then to each coverage segment in the order of the increases.
Decreases
Any decrease in Specified Amount (whether specifically requested by the
Policy Owner or as a result of a Partial Surrender or a death benefit Option
change) will first be applied to reduce the coverage segments of Specified
Amount associated with the most recent increases, then the next most recent
increases successively, and finally to the original Specified Amount. A decrease
will not be permitted if the Specified Amount would fall $100,000.
The Minimum Monthly Premium will not be adjusted for the decrease in
Specified Amount. The required premiums under the Guaranteed Death Benefit
Rider, if applicable, will be adjusted for the decrease in Specified Amount. If
the Specified Amount is decreased at the same time that a premium payment is
received, the decrease will be processed before the premium payment is
processed. Rider coverages may also be affected by a decrease in Specified
Amount.
The Company reserves the right to disallow a requested decrease, and will
not permit a requested decrease, among other reasons, (i) if compliance with the
guideline premium limitations under federal income tax law resulting from the
requested decrease would result in immediate termination of the Policy, or (ii)
if, to effect the requested decrease, payments to the Policy Owner would have to
be made from Fund Value for compliance with the guideline premium limitations,
and the amount of such payments would exceed the Cash Value under the Policy. If
we do not approve a change you have requested, we will send you a written notice
of our decision about making the change. See "Federal Income Tax
Considerations -- Definition of Life Insurance," page 34.
GUARANTEED DEATH BENEFIT
Generally, the length of time the Policy remains in force depends on the
Cash Value of the Policy. Because the charges that maintain the Policy are
deducted monthly from the Fund Value, coverage will last as long as the Cash
Value of the Policy is sufficient to pay these charges. See "Grace Period and
Lapse," page 27. The investment experience of any amounts in the Subaccounts of
the Variable Account and the interest
21
<PAGE> 27
earned in the Guaranteed Interest Account will affect the amount of the Fund
Value and, as a result, the length of time the Policy remains in force without
the payment of additional premiums.
When application for a Policy is made, the Policy Owner will have the
opportunity to choose the Guaranteed Death Benefit Rider, which may extend the
period that the Specified Amount of the Policy and certain other Rider coverages
will remain in effect if the Subaccounts suffer adverse investment experience.
See "Guaranteed Death Benefit Charge," page 31.
On each Monthly Anniversary Day, the following test will be performed to
determine whether the Guaranteed Death Benefit Rider will remain in effect: (i)
the actual premiums paid, less the amount of any Partial Surrenders (and
including any fees imposed as a result of any Partial Surrenders) less any
Outstanding Debt must equal or exceed (ii) the Monthly Guarantee Premium for the
Rider times the number of complete months since the Policy Date. If the Policy
fails to meet this test on any Monthly Anniversary Day, the Guarantee Period,
and therefore the Guaranteed Death Benefit Rider, will terminate. Once
terminated, the Guaranteed Death Benefit Rider can not be reinstated.
There is a Grace Period for this Rider. See "Grace Period and Lapse -- If
Guaranteed Death Benefit Rider Is in Effect", page 28.
There is a charge for the Guaranteed Death Benefit Rider. See "Guaranteed
Death Benefit Charge," page 31. This charge will end at the conclusion of the
Guarantee Period, if the Rider is chosen, and it will end if at any time the
Policy fails the monthly tests.
Please refer to the Policy for additional information on the Guaranteed
Death Benefit Rider.
The Guaranteed Death Benefit Rider is not available in all states.
OTHER OPTIONAL INSURANCE BENEFITS
Subject to certain requirements, a Policy Owner may elect to add one or
more of the optional insurance benefits described below to the Policy at the
time of application for a Policy. These other optional insurance benefits are
added to the Policy by Rider. A charge will be deducted monthly from the Fund
Value for each other optional insurance benefit added to the Policy. See
"Charges and Deductions," page 29. The amounts of these benefits are fully
guaranteed at issue, and they can be canceled by the Policy Owner at any time.
Certain restrictions may apply and are described in the applicable Rider. In
addition, adding or canceling these benefits may have an effect on the Policy's
status as a modified endowment contract. See "Federal Income Tax
Considerations -- Modified Endowment Contracts," page 36 . An insurance agent
authorized to sell the Policy can describe these extra benefits further. Samples
of the provisions are available from the Company upon written request.
From time to time we may make available Riders other than those listed
below. Contact an insurance agent authorized to sell the Policy for a complete
list of the Riders available.
Waiver of Monthly Deductions Rider
This Rider provides that during a covered disability of the selected
Insured prior to Age 65, while the Policy remains in force, the monthly
administrative charges, per $1,000 Specified Amount charges, cost of insurance
charges and Rider charges will be waived and therefore not deducted from the
Fund Value. This Rider does not waive the payment of premiums required by the
Guaranteed Death Benefit Rider, however, the cumulative Monthly Guarantee
Premium requirement does not change during the covered disability. It remains
fixed at the level at the beginning of the disability. The Guaranteed Death
Benefit Rider is not available in all states.
Waiver of Specified Premium Rider
This Rider provides that during a covered disability of the selected
Insured, while the Policy remains in force, the monthly Specified Premium will
be waived and therefore added to the Fund Value on each Monthly Anniversary. Net
premiums will be allocated among the Subaccounts and the Guaranteed Interest
Account
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according to the Policy Owner's most recent instructions. This Rider does not
waive the monthly deductions of the Policy nor does this Rider waive the payment
of premiums required by the Guaranteed Death Benefit Rider. The Guaranteed Death
Benefit Rider is not available in all states.
Four Year Term Insurance
The Four Year Term Insurance Rider provides non-renewable, non-convertible
term insurance payable if the second death occurs within the first four policy
years. If the Policy Owner makes any changes to the Specified Amount, the amount
of this rider will be adjusted.
Option to Split Policy Benefit
This benefit provides that the Policy may be split into two other
individual life insurance policies upon certain major changes in Federal income
tax laws, divorce (if the Insureds are married at the time of Policy issue) or
upon business dissolution (if the Insureds are employees of one organization at
the time of Policy issue) in the six month period which follows such tax law
change, divorce or business dissolution. Evidence of insurability at the time of
the exercise of this option will not be required if as a result of tax law
change, but will be required in all other instances. Certain conditions, as
described in the Policy, must be met before this benefit can be exercised. This
benefit is guaranteed by the Guaranteed Death Benefit Rider. There is no charge
for this benefit. This Rider is not available in all states.
BENEFITS AT MATURITY
If one or both of the Insureds is living on the Maturity Date, the Company
will pay to the Policy Owner, as an endowment benefit, the Cash Value of the
Policy. Payment ordinarily will be made within seven days of the Policy
Anniversary, although payments may be postponed in certain circumstances. See
"Payments," page 43. At the option of the Policy Owner, payment of the endowment
benefit may be deferred until the date of the last surviving Insured's death.
Death proceeds payable immediately after the Maturity Date equal the Cash Value
of the Policy multiplied by the death benefit percentage at the Insured's age
100. Premiums will not be accepted, nor will monthly deductions be made, after
the Maturity Date.
Please refer to the Policy for additional information on the Maturity
Extension Rider.
POLICY VALUES
Fund Value
The Fund Value is the sum of the amounts under the Policy held in each
Subaccount of the Variable Account and any Guaranteed Interest Account, as well
as the amount set aside in the Company's Loan Account, and any interest thereon,
to secure Outstanding Debt.
On each Business Day, the portion of the Fund Value allocated to any
particular Subaccount will be adjusted to reflect the investment experience of
that Subaccount. On each Monthly Anniversary Day, the portion of the Fund Value
allocated to a particular Subaccount also will be adjusted to reflect the
assessment of the monthly deduction. See "Determination of Fund Value," page 24.
No minimum amount of Fund Value allocated to a particular Subaccount is
guaranteed. A Policy Owner bears the risk for the investment experience of Fund
Value allocated to the Subaccounts.
Cash Value
The Cash Value of the Policy equals the Fund Value less the Surrender
Charge less any Outstanding Debt. Thus, the Fund Value will exceed the Policy's
Cash Value by the amount of the Surrender Charge and any Outstanding Debts. Once
the Surrender Charge has expired, the Fund Value will equal the Cash Value less
any Outstanding Debt.
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DETERMINATION OF FUND VALUE
Although the death benefit under a Policy can never be less than the
Policy's Specified Amount, the Fund Value will vary depending upon several
factors, including the investment performance of the Subaccounts to which Fund
Value has been allocated, payment of premiums, the amount of any Outstanding
Debt, Partial Surrenders, and the charges assessed in connection with the
Policy. There is no guaranteed minimum Fund Value and the Policy Owner bears the
entire investment risk relating to the investment performance of Fund Value
allocated to the Subaccounts.
The amounts allocated to the Subaccounts will be invested in shares of the
corresponding Portfolios of the Funds. The value of the Subaccounts will reflect
the investment experience of the corresponding Portfolio. The investment
experience reflects the investment income, realized and unrealized capital gains
and losses and expenses of the Portfolio and any dividends or distributions
declared by a Portfolio. Any dividends or distributions from any Portfolio of
the Funds will be automatically reinvested in shares of the same Portfolio,
unless the Company, on behalf of the Variable Account, elects otherwise. The
Subaccount value will also reflect the mortality and expense risk charges the
Company makes each day to the Variable Account.
Amounts allocated to the Subaccounts are measured in terms of Units, which
are a measure of value used for bookkeeping purposes. The value of amounts
invested in each Subaccount is represented by the value of the Units credited to
the Policy for that Subaccount. On any given day, the amount in a Subaccount of
the Variable Account is equal to the Unit value times the number of Units
credited to the Policy in that Subaccount. The Units of each Subaccount will
have different Unit values.
Units of a Subaccount are purchased (credited) whenever premiums or
transfer amounts (including transfers from the Loan Account) are allocated to
that Subaccount. Units are redeemed (debited) to make Partial or Full
Surrenders, to transfer amounts from a Subaccount (including transfers to the
Loan Account), and to pay the death benefit when the last surviving Insured
dies. Units are also redeemed to pay the monthly deductions from the Policy's
Fund Value, for Policy transaction charges, and to pay Surrender Charges, if
any. The number of Units purchased or redeemed in connection with any such
transaction is determined by dividing the dollar amount of such transaction by
the Unit Value of the affected Subaccount, calculated after the close of
business that day. The number of Units changes only as a result of Policy
transactions or charges; the number of Units credited will not change because of
subsequent changes in Unit Value.
Transactions are processed as of the Transaction Date. The Transaction Date
is the date a premium or an acceptable written or telephone request is received
at the Administrative Office. If the premium or request reaches the
Administrative Office on a day which is not a Business Day, or after the close
of business on a Business Day (that is, after 4:00 p.m. Eastern Time), the
Transaction Date will be the next succeeding Business Day. All Policy
transactions are performed as of a Business Day. If a Transaction Date or
Monthly Anniversary Day occurs on a day other than a Business Day (e.g., on a
Saturday), the calculation will take place on the next Business Day (e.g., on
the following Monday).
CALCULATING UNIT VALUES FOR EACH SUBACCOUNT
The Unit Value of a Subaccount on any Business Day is calculated by the
Company on every Business Day as follows:
1. Calculate the value of the shares of the Portfolio belonging to the
Subaccount as of the close of business that Business Day (before giving
effect to any Policy transactions for that day, such as premium payments or
surrenders). For this purpose, the Net Asset Value per share reported to
the Company by the managers of the Portfolio is used.
2. Add the value of any dividends or capital gains distributions
declared and reinvested in shares of the Portfolio during the Valuation
Period. Subtract from this amount a charge for taxes, if any.
3. Subtract a charge for the mortality and expense risk assumed by the
Company under the Policy. See "Daily Deductions From the Variable
Account -- Mortality and Expense Risk Charge", page 30. If
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the previous day was not a Business Day, then the charge is adjusted for
the additional days between valuations.
4. Divide the resulting amount by the number of Units held in the
Subaccount on the Business Day before the purchase or redemption of any
Units on that Date.
The Unit Value of each Subaccount on its first Business Day was set at $10.00.
TRANSFER OF FUND VALUE
Fund Value may be transferred after the Right to Return Policy Period among
the Subaccounts by the Policy Owner upon proper written request to the Company's
Administrative Office. Transfers may be made by telephone if an authorization
for telephone transfer form has been properly completed and signed and filed at
the Company's Syracuse Operations Center. See "Telephone Transfer Privileges,"
page 45. Currently, there are no limitations on the number of transfers between
Subaccounts, no minimum amount required for a transfer, nor any minimum amount
required to remain in a given Subaccount after a transfer. Further, no transfer
may be made if a Policy is in the Grace Period and a payment required to avoid
lapse is not paid. See "Grace Period and Lapse," page 27. No charges are
currently imposed upon such transfers. The Company reserves the right, however,
at a future date to assess a maximum $25 transfer charge on Policy transfers and
to discontinue telephone transfers.
Fund Value may also be transferred after the Right to Return Policy Period
from the Subaccounts to the Guaranteed Interest Account. Transfers from the
Guaranteed Interest Account to the Subaccounts will only be permitted in the
Policy month following a Policy Anniversary as described in "The Guaranteed
Interest Account," page 40.
RIGHT TO EXCHANGE POLICY
During the first 24 months following the Policy Date, the Policy Owner may
exercise the right to exchange the Policy from one in which the investment
experience is not guaranteed into a guaranteed Policy. This is accomplished by
the transfer of the entire amount in the Subaccounts of the Variable Account to
the Guaranteed Interest Account, and the allocation of all future premium
payments to the Guaranteed Interest Account. This will, in effect, serve as an
exchange of the Policy for the equivalent of a last survivor flexible premium
joint survivorship universal life insurance policy. See "The Guaranteed Interest
Account," page 40. No charge will be imposed on the transfer in exercising the
exchange privilege.
POLICY LOANS
The Policy Owner may borrow money from the Company at any time using the
Policy as the only security for the loan by submitting a proper written request
to the Company's Administrative Office. A loan may be taken any time a Policy
has a positive Cash Value. The maximum amount that can be borrowed at any time
is 90% of the Cash Value of the Policy. (If the loan is requested on a Monthly
Anniversary Day, the maximum loan amount is further reduced by the monthly
deduction due on that day.) The Outstanding Debt is the cumulative amount of
outstanding policy loans and loan interest payable to the Company at any time.
Loan interest is payable in arrears on each Policy Anniversary at an annual
rate which varies by the number of years since the Policy was issued. For the
first ten Policy years a loan rate of 5.25% applies. After the tenth Policy
Anniversary, a loan rate of 4.75% applies. Interest on the full amount of any
Outstanding Debt is due on the Policy Anniversary, until the Outstanding Debt is
repaid. If interest is not paid when due, it will be added to the amount of the
Outstanding Debt.
The Owner may repay all or part of the Outstanding Debt at any time while
the Policy is in force. Only payments indicated as loan or interest payments
will be treated as such. If a loan repayment is made which exceeds the
Outstanding Debt, the excess will be applied as a Scheduled Premium Payment,
subject to the rules on acceptance of premium payments.
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When a Policy Owner takes a loan, an amount equal to the loan is
transferred out of the Policy Owner's Fund Value in the Subaccounts and the
Guaranteed Interest Account into the Loan Account to secure the loan. The Policy
Owner may, within certain limits, specify the amount or the percentage of the
loan amount to be deducted from the Subaccounts and the Guaranteed Interest. If
the Policy Owner does not specify the source of the transfer, or if the transfer
instructions are incorrect, the request for loan will not be accepted. On each
Policy Anniversary, an amount equal to the loan interest due and unpaid for the
Policy Year will be transferred to the Loan Account from the Subaccounts and
Guaranteed Interest Account on a proportional basis.
The Loan Account is a part of the Company's General Account. Amounts held
in the Loan Account are credited monthly with a rate of interest not less than
an annualized rate of 4.5%.
Loan repayments release amounts from the Loan Account. Unless otherwise
requested by a Policy Owner, amounts released from the Loan Account as a result
of a loan repayment will be transferred into the Subaccounts and Guaranteed
Interest Account in accordance with the most recent allocation instructions for
Scheduled Premium Payments. In addition, Fund Value in the Loan Account in
excess of the outstanding loan is treated differently depending on whether at
the time the loan was made Fund Values were transferred from the Subaccounts or
the Guaranteed Interest Account and whether or not loan interest due is paid
when due or the amount of the interest is added to the loan ("capitalized"). If
the loan is from the Subaccounts and loan interest is capitalized, this excess
offsets the amount that must be transferred from the Subaccounts to the Loan
Account on the policy anniversary. If the loan is from the Subaccounts and loan
interest is paid in cash, this excess is allocated to the Subaccounts and/or the
Guaranteed Interest Account on the policy anniversary using the most recent
Scheduled Premium Payment allocation on record. If the loan is from the
Guaranteed Interest Account, this excess is allocated back to the Guaranteed
Interest Account on a monthly basis proportionately to all interest crediting
generations from which the loan was taken.
While the amount to secure the Outstanding Debt is held in the Loan
Account, the Policy Owner forgoes the investment experience of the Subaccounts
and the current interest rate of the Guaranteed Interest Account on that amount.
Thus Outstanding Debt, whether or not repaid, will have a permanent effect on
the Policy's values and may have an effect on the amount and duration of the
Death Benefit. If not repaid, the Outstanding Debt will be deducted from the
amount of Death Benefit paid upon the death of the last surviving Insured, or
the value paid upon surrender or maturity.
Outstanding Debt may affect the length of time the Policy remains in force.
After the third Policy Anniversary, the Policy will lapse when Cash Value is
insufficient to cover the monthly deduction against the Policy's Fund Value on
any Monthly Anniversary Day and the minimum payment required is not made during
the Grace Period. Moreover, the Policy may enter the Grace Period more quickly
when Outstanding Debt exists, because the Outstanding Debt is not available to
cover the monthly deduction. In addition, the Guarantee Period under the
Guaranteed Minimum Death Benefit Rider may end if total premiums received less
any Partial Surrenders and their fees, less Outstanding Debt do not exceed the
premiums required under that Rider. The Guaranteed Death Benefit Rider is not
available in all states. Additional payments or repayment of a portion of
Outstanding Debt may be required to keep the Policy or Rider in force. See
"Grace Period and Lapse," page 27.
A loan will not be treated as a distribution from the Policy and will not
result in taxable income to the Policy Owner unless the Policy is a modified
endowment contract, in which case a loan will be treated as a distribution that
may give rise to taxable income. For more information on the tax treatment of
loans, see "Federal Income Tax Considerations," page 34.
FULL SURRENDER
A Policy Owner may fully surrender a Policy at any time while either or
both of the Insureds is living. The amount received in the event of a full
surrender is the Policy's Cash Value, which is equal to its Fund Value less
Surrender Charge less any Outstanding Debt.
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A Policy Owner may surrender a Policy by sending a written request together
with the Policy to the Company's Administrative Office. The proceeds will be
determined as of the end of the Valuation Period during which the request for a
surrender is received. A Policy Owner may elect to have the proceeds paid in
cash or applied under a payment plan offered under the Policy. See "Payment
Plan/Settlement Provisions," page 43. For information on the tax effects of a
surrender of a Policy, see "Federal Income Tax Considerations," page 34.
PARTIAL SURRENDER
A Partial Surrender allows the Policy Owner to obtain a portion of the Cash
Value of the Policy without having to surrender the Policy in full. A Partial
Surrender may be made at any time and the Partial Surrender will take effect on
the Business Day that we receive your request at our Administrative Office, or
on the next Business Day if that day is not a Business Day. There is currently
no limit on the number of Partial Surrenders allowed in a Policy year.
A Partial Surrender must be for at least $500 (plus the applicable fee),
and the Policy's Cash Value after the Partial Surrender must be at least $500.
If a Loan on the Policy has been taken, the amount of the Partial Surrender is
limited so that the Loan amount, after giving effect to the Partial Surrender,
is not greater than 90 percent of Cash Value.
The Policy Owner may make a Partial Surrender by submitting a proper
written request to the Company's Administrative Office. As of the effective date
of any Partial Surrender, the Policy Owner's Fund Value and Cash Value will be
reduced by the amount surrendered (plus the applicable fee). The amount of the
Partial Surrender (plus the applicable fee) will be allocated by amount or
percent to the Policy Owner's Fund Value in the Subaccounts and the Guaranteed
Interest Account as specified by the Policy Owner. Allocations by percentage
must be in whole percentages and the minimum percentage is 10% against any
Subaccount or the Guaranteed Interest Account. Percentages must total 100%. We
will not accept an allocation which does not comply with the rules or if there
is not enough Fund Value in a Subaccount or the Guaranteed Interest Account to
provide its share of the allocation. If the last surviving Insured dies after
the request for a Partial Surrender is sent to the Company and prior to the
Partial Surrender being effected, the amount of the Partial Surrender will be
deducted from the death benefit proceeds, which will be determined without
taking into account the amount surrendered.
When a Partial Surrender is made on a Policy on which the Owner has
selected death benefit Option 1, the Specified Amount under the Policy is
decreased by the amount of the Partial Surrender (excluding its fee). A Partial
Surrender will not change the Specified Amount of a Policy on which the Owner
has selected death benefit Option 2. However, assuming that the death benefit is
not equal to Fund Value times a death benefit percentage, the Partial Surrender
will reduce the death benefit by the amount of the Partial Surrender. Under
either death benefit Option, to the extent the death benefit is based upon the
Fund Value times the death benefit percentage applicable to the Insured, a
Partial Surrender may cause the death benefit to decrease by an amount greater
than the amount of the Partial Surrender. See "Death Benefits under the Policy,"
page 18.
A fee for each Partial Surrender will be assessed. See "Charges and
Deductions -- Transaction and Other Charges", page 32.
For information on the tax treatment of Partial Surrenders, see "Federal
Income Tax Considerations," page 40.
GRACE PERIOD AND LAPSE
In general, the Policy and all Riders attached to it will continue in force
as long as the Cash Value of the Policy is sufficient to pay all the deductions
that are taken from Fund Value each month. The Policy will lapse only when the
Cash Value is insufficient to cover the current monthly deduction against the
Policy's Fund Value on any Monthly Anniversary Day, and a 61-day Grace Period
expires without the Policy Owner making a sufficient payment.
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Special Rule for First Three Policy Years
During the first three Policy years, (or first three policy years following
an increase in Specified Amount during that period), if on each Monthly
Anniversary Day the sum of premiums paid, less the sum of Partial Surrenders
(excluding its fees) and any Outstanding Debt is greater than or equal to the
Minimum Monthly Premiums times the number of completed Policy months (or number
of months from the most recent increase in Specified Amount) or the Cash Value
is greater than zero, the Policy and all attached Riders are guaranteed not to
lapse.
If the insufficiency occurs at any other time, or if the Minimum Monthly
Premium test has not been met during the first three Policy years, the Policy
may be at risk of lapse depending on whether or not the Guaranteed Death Benefit
Rider is in effect, as explained below.
If Guaranteed Death Benefit Rider Is Not in Effect
If an insufficiency occurs and the Guaranteed Death Benefit Rider is not in
effect, the Owner must pay during the Grace Period the amount required under the
Policy to avoid Lapse. In addition, payment of any loan interest accrued for the
Policy year but unpaid as of the Monthly Anniversary Day when insufficiency
occurs may be required prior to the end of the Grace Period.
The Company will not accept any payment if it would cause the total premium
payments to exceed the maximum permissible premium for the Policy's Specified
Amount under the Internal Revenue Code. This may occur when the Policy Owner has
Outstanding Debt, in which case the Policy Owner could repay a sufficient
portion of the Outstanding Debt to avoid termination. In this instance, the
Policy Owner may wish to repay an additional portion of the Outstanding Debt to
avoid recurrence of the potential lapse. If premium payments have not exceeded
the maximum permissible premiums for the Policy's Specified Amount, the Policy
Owner may also wish to make larger or more frequent premium payments to avoid
recurrence of the potential lapse. However, the Company will not reject any
premium payments necessary to prevent lapse of the Policy.
If the Cash Value of the Policy is insufficient to cover the entire monthly
deduction on a Monthly Anniversary Day, the Company will deduct the amount that
is available. The Company will notify the Policy Owner (and any assignee of
record) of the payment required to keep the Policy in force. The Policy Owner
will then have a Grace Period of 61 days, measured from the date the notice is
sent, to make the required payment. During the first three Policy years, if the
Cash Value of the Policy is less than zero, the payment required is the amount
of Minimum Monthly Premium not paid plus one succeeding Minimum Monthly Premium.
After the third Policy anniversary, the payment required is the amount of the
Monthly Deduction not paid plus two succeeding Monthly Deductions. The Policy
will remain in force through the Grace Period. Failure to make the required
payment within the Grace Period will result in termination of coverage under the
Policy and all Riders, and the Policy will lapse. If the required payment is
made during the Grace Period, any premium paid will be allocated among the
Subaccounts of the Variable Account and the Guaranteed Interest Account in
accordance with the Policy Owner's current Scheduled Premium Payment allocation
instructions. Any monthly deduction due will be charged to the Subaccounts and
the Guaranteed Interest Account on a proportionate basis. If the last surviving
Insured dies during the Grace Period, the death proceeds will equal the amount
of the death benefit immediately prior to the commencement of the Grace Period,
reduced by any unpaid monthly deductions (which for Policies offered to
residents of, or issued for delivery in, the State of New Jersey cannot exceed
the minimum premium for the following month) and any Outstanding Debt.
If Guaranteed Death Benefit Rider Is in Effect
If the Guaranteed Death Benefit Rider is in effect and the test for
continuation of the Guarantee Period has been met, the Specified Amount of the
Policy and certain Rider coverages will not lapse during the Guarantee Period
even if the Cash Value is not sufficient to cover all the deductions from the
Fund Value on any Monthly Anniversary Day. See "Guaranteed Death Benefit", page
21.
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While the Guaranteed Death Benefit Rider is in effect, the Fund Value of
the Policy may be reduced by Monthly Deductions, but not below zero. Any Monthly
Deductions during the Guarantee Period which would reduce the Cash Value below
zero will be waived.
The Guaranteed Death Benefit Rider will be terminated if the Policy does
not meet the monthly tests, as explained in "Guaranteed Death Benefit", page 21,
and the payment required under the Rider is not made within the Grace Period. If
the Guaranteed Death Benefit Rider is terminated, the normal test for lapse will
resume.
The Guaranteed Death Benefit Rider is not available in all states, and,
therefore, Grace Period and Lapse will be treated as described in the
immediately preceding section entitled "If the Guaranteed Death Benefit Is Not
In Effect".
REINSTATEMENT
The Company will reinstate a lapsed Policy (but not a Policy which has been
surrendered for its Cash Value) at any time within five years after the Monthly
Anniversary Day immediately before the start of the Grace Period but before the
Maturity Date, provided the Company receives the following: (i) a written
application from the Policy Owner; (ii) evidence of insurability satisfactory to
the Company; (iii) payment of all monthly deductions that were due and unpaid
during the Grace Period; (iv) payment of an amount at least sufficient to keep
the Policy in force for one month after the date of reinstatement; (v) payment
or reinstatement of any Debt on the Policy Anniversary at the start of the grace
period and (vi) payment of interest on debt reinstated from the beginning of the
grace period to the end of the grace period at the rate which applies to policy
loans on the date of reinstatement.
When the Policy is reinstated, the Fund Value will be equal to the Fund
Value on the date of the lapse, subject to the following: (i) the Surrender
Charge will be equal to the Surrender Charge that would have existed had the
Policy been in force since the original Policy Date; (ii) the Fund Value will be
reduced by the decrease, if any, in the Surrender Charge during the period which
the Policy was not in force; (iii) any Outstanding Debt on the date of lapse
will also be reinstated; and, (iv) no interest on amounts held in the Company's
Loan Account to secure Outstanding Debt will be paid or credited between lapse
and reinstatement. Reinstatement will be effective as of the Monthly Anniversary
Day on or preceding the date of approval by the Company, and Fund Value minus,
if applicable, Outstanding Debt will be allocated among the Subaccounts and the
Guaranteed Interest Account in accordance with the Policy Owner's most recent
Scheduled Premium Payment allocation instructions.
CHARGES AND DEDUCTIONS
DEDUCTIONS FROM PREMIUMS
Certain charges are deducted from each premium payment under a Policy prior
to allocation of the net premium to the Policy Owner's Fund Value. These charges
consists of the following items:
Sales Charge
The sales charge in the first ten Policy years is equal to 6% of the
premiums paid up to each year's Target Premium and 3% of premium paid in excess
of the Target Premium in that year. The Target Premium is actuarially determined
based upon the Specified Amount of the Policy and the Age, gender, underwriting
class and smoker status of each of the Insureds. The Target Premium is
established at issue, and will be adjusted if the Specified Amount is increased
or decreased. Refer to your Policy for the amount of Target Premium on which any
sales charge will be based.
The sales charge is equal to 3% of all premiums after the tenth Policy
year.
The sales charge is deducted to compensate the Company for the cost of
distributing the Policies. The amount derived by the Company from the sales
charge is not expected to be sufficient to cover the sales and distribution
expenses in connection with the Policies. If surrendered within 10 years after
issuance, or within
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10 years following an increase in the Specified Amount, the Policy will also be
subject to a Surrender Charge, which is described on page 31. To the extent that
sales and distribution expenses exceed sales charges, such expenses may be
recovered from other charges, including amounts derived indirectly from the
charge for mortality and expense risks and from mortality gains.
Tax Charges
All states levy taxes on life insurance premium payments. The amount of
these taxes vary from state to state, and may vary from jurisdiction to
jurisdiction within a state. The Company currently deducts an amount equal to
2.25% of each premium to pay applicable premium taxes. Currently, these taxes
range from 0% to 4%, and, therefore, the 2.25% deduction may be higher or lower
than the actual premium tax imposed by the applicable jurisdiction. The 2.25%
rate approximates the average tax rate the Company expects to pay on premiums.
The Company does not expect to make a profit from this charge.
A charge currently equal to 1.5% of each premium payment is deducted from
each premium to cover the estimated cost for the Federal income tax treatment of
deferred acquisition costs determined solely by the amount of life insurance
premiums received. The Company believes this charge for deferred acquisitions
costs is reasonable in relation to the Company's increased federal tax burden
under IRC Section 848 resulting from the receipt of premium payments. No charge
will be deducted where premiums received from a Policy Owner are not subject to
this tax.
The Company reserves the right to increase or decrease the charge for taxes
due to any change in tax law or due to any change in the cost to the Company.
DAILY DEDUCTIONS FROM THE VARIABLE ACCOUNT
Mortality and Expense Risk Charge
Each day a charge is deducted for mortality and expense risks assumed by
the Company. This charge is guaranteed not to exceed .000959% per day of the
amount in the Subaccounts of the Variable Account, which is equivalent to an
annual rate of .35% of the portion of the Policy Fund Value allocated to the
Variable Account.
The mortality and expense risk charge is assessed to compensate the Company
for assuming mortality and expense risks under the Policies. The mortality risk
assumed is that Insureds, as a group, may live for a shorter period of time than
estimated and, therefore, the cost of insurance charges specified in the Policy
will be insufficient to meet the Company's actual claims. The expense risk the
Company assumes is that other expenses incurred in issuing and administering the
Policies and operating the Variable Account will be greater than the amount
estimated when setting the charges for these expenses. The Company will realize
a profit from this fee to the extent it is not needed to provide benefits and
pay expenses under the Policies. The Company may use this profit for other
purposes, including any distribution expenses not covered by the sales charge or
Surrender Charge.
This charge is not assessed against the amount of the Policy Fund Value
which is allocated to the Guaranteed Interest Account, nor to amounts in the
Loan Account.
MONTHLY DEDUCTIONS FROM FUND VALUE
A charge called the monthly deduction is deducted from a Policy's Fund
Value in the Subaccounts and Guaranteed Interest Account beginning on the Policy
Date and on each Monthly Anniversary Day thereafter. The monthly deduction
consists of the following items:
Cost of Insurance
This monthly charge compensates the Company for the anticipated cost of
paying death benefits in excess of Fund Value to Beneficiaries of Insureds who
die. The amount of the charge is equal to a current cost of insurance rate
applicable to each of the Insureds multiplied by the net amount at risk under a
Policy at the
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beginning of the Policy Month. The net amount at risk for these purposes is
equal to the amount of Death Benefit of the Policy plus any death benefit
payable under the Four Year Term Insurance Rider at the beginning of the Policy
Month less the Fund Value at the beginning of the Policy Month.
The Policy contains guaranteed cost of insurance rates that may not be
increased. The guaranteed rates are based on the 1980 Commissioners Standard
Ordinary Smoker and Nonsmoker Mortality Tables where unisex cost of insurance
rates apply, the 1980 Commissioners Ordinary Smoker and Nonsmoker Mortality
Table B). These rates are based on the Age and underwriting class of each of the
Insureds. They are also based on the gender of the Insureds, except that unisex
rates are used where appropriate under applicable law, including in the state of
Montana. As of the date of this prospectus, the Company charges "current rates"
that are lower (i.e., less expensive) than the guaranteed rates, and the Company
may also change current rates in the future. Like the guaranteed rates, the
current rates also vary with the Age, gender, smoking status, and underwriting
class of each of the Insureds. In addition, they also vary with the size of the
Policy and the Policy duration. The cost of insurance rate generally increases
with the Ages of the Insureds.
For purposes of this charge, the cost of insurance rates applicable to the
original coverage segment of Specified Amount will be based on the underwriting
class at issue and the number of Policy years since the Policy Date. Cost of
insurance rates for new coverage segments of Specified Amount related to
increases will be based on the underwriting classes at the time of the increase
and the number of Policy years since such increase. If an increase in Specified
Amount causes a Policy to change size bands, the cost of insurance charges for
the previously existing coverage segments of Specified Amount will not be
adjusted to reflect the change.
Administrative Charge
An administrative charge of $7.50 is deducted monthly from the Fund Value.
The administrative charge is assessed to reimburse the Company for the
expenses associated with administration and maintenance of the Policies. The
administrative charge is guaranteed never to exceed $7.50. The Company does not
expect to profit from this charge.
Per $1,000 Specified Amount Charge
For the first ten Policy Years following issue or increase in Specified
Amount, a per $1,000 Specified Amount charge will apply. These per $1,000 of
Specified Amount charges differ based on issue age of the coverage segment,
underwriting class and smoking status of the younger Insured. The monthly per
$1,000 factors are shown in Appendix A.
Guaranteed Death Benefit Charge
If the Guaranteed Death Benefit Rider has been elected, a charge of $0.01
per thousand dollars of Policy Specified Amount and certain Rider amounts is
deducted each month during the Guarantee Period. This charge is guaranteed never
to exceed this amount.
The Guaranteed Death Benefit Rider is not available in all states.
Other Optional Insurance Benefits Charges
The monthly deduction will include charges for any other optional insurance
benefits added to the Policy by Rider. See "Other Optional Insurance Benefits,"
page 22.
SURRENDER CHARGE
The Company will assess a Surrender Charge against Fund Value upon full
surrender of a Policy or lapse within ten years of the Policy Date or a
subsequent increase in Specified Amount. The Surrender Charge is designed to
recover the Company's expenses in issuing and distributing Policies.
31
<PAGE> 37
The surrender charge is based on a factor per $1,000 of Initial Specified
Amount. Starting on the first anniversary, the charge decreases from its maximum
by 10% per year until it reaches zero at the end of the 10th policy year. The
Surrender Charge factors at issue vary by Specified Amount, issue age, gender
and underwriting class. The Surrender Charge does not increase as the Insureds
get older or with increases in the Specified Amount due to a death benefit
Option change. A Surrender Charge will be calculated for new segments of
Specified Amount added as a result of requested increases. The maximum level of
surrender charge is $53.31 per $1,000 of Specified Amount. Your policy will give
you the information to determine the Surrender Charge in any year.
A Surrender Charge will not be deducted on a decrease in Specified Amount.
<TABLE>
<CAPTION>
POLICY YEAR GRADING % POLICY YEAR GRADING %
- ----------- --------- ------------ ---------
<S> <C> <C> <C>
1 100% 7 40
2 90 8 30
3 80 9 20
4 70 10 10
5 60 11 and later 0
6 50
</TABLE>
CORPORATE PURCHASERS
The Policy is available for purchase by individuals, trusts, corporations
and other organizations. For corporate or other group or sponsored arrangements
purchasing one or more Policies, the Company may reduce the amount of the Sales
Charge, Surrender Charge, or other charges where the expenses associated with
the sale of the Policy or Policies or the underwriting or other administrative
costs associated with the Policy or Policies are reduced. Sales, underwriting or
other administrative expenses may be reduced for reasons such as expected
economies resulting from a corporate purchase or a group or sponsored
arrangement, from the amount of the initial premium payment or payments, or the
amount of projected premium payments.
TRANSACTION AND OTHER CHARGES
A Partial Surrender fee of $10 will be deducted from the Fund Value for
each Partial Surrender transaction. This charge is guaranteed not to exceed $10.
The Company currently does not charge for transfers of Fund Value between
the Subaccounts. The Company does, however, reserve the right to assess a $25
charge on transfers (including telephone transfers, if permitted by the
Company). For Policies issued for delivery to residents of the Commonwealth of
Pennsylvania, the Company guarantees that no transfer charge will be imposed on
transfers made within one year from the date the Policy is issued.
The Company charges a fee of $200 for exercise of the Option to Split
Policy Benefit.
The Company may charge the Subaccounts for federal income taxes incurred by
the Company that are attributable to the Variable Account and its Subaccounts.
No such charge is currently assessed. See "Charge for Company Income Taxes,"
page 37.
The Company will bear the direct operating expenses of the Variable
Account. The Subaccounts purchase shares of the corresponding Portfolio of the
underlying Fund. The Fund and each of its Portfolios incur certain charges
including the investment advisory fee and certain operating expenses. The Funds
are governed by their Boards. The Fund's expenses are not fixed or specified
under the terms of the Policy. The advisory fees and other expenses are more
fully described in the prospectuses of the Funds.
FEES AND EXPENSES OF THE FUNDS
The Subaccounts purchase shares of the corresponding Portfolio of the
underlying Fund. The Fund and each of its Portfolios incur certain charges
including the investment advisory fee and certain operating expenses. These fees
and expenses vary by Portfolio are set forth below. The Funds are governed by
their Boards. The Fund's expenses are not fixed or specified under the terms of
the Policy. The advisory fees and
32
<PAGE> 38
other expenses are summarized at pages 10-11 of this Prospectus and are more
fully described in the prospectuses of the Funds.
Information contained in the following table was provided by the respective
Funds and has not been independently verified by the Company.
PRO FORMA ANNUAL EXPENSES FOR THE YEAR ENDED
DECEMBER 31, 1997
<TABLE>
<CAPTION>
OTHER
EXPENSES
MANAGEMENT (AFTER TOTAL
FUND/PORTFOLIO FEES REIMBURSEMENT) EXPENSES
-------------- ---------- -------------- --------
<S> <C> <C> <C>
MONY Series Fund, Inc.
Intermediate Term Bond Portfolio................. .50%(1) .09%(2) .59%
Long Term Bond Portfolio......................... .50(1) .07(2) .57
Government Securities Portfolio.................. .50(1) .14(2) .64
Money Market Portfolio........................... .40 .06(2) .46
Enterprise Accumulation Trust Equity Portfolio..... .80% .04% .84%
Small Company Value Portfolio.................... .80 .06 .86
Managed Portfolio................................ .73 .03 .76
International Growth Portfolio................... .85 .34 1.19
High Yield Bond Portfolio........................ .60 .17 .77
Small Company Growth Portfolio................... 1.00 40(3) 1.40(3)
Equity Income Portfolio.......................... .75 .30(3) 1.05(3)
Capital Appreciation Portfolio................... .75 .55(3) 1.30(3)
Growth and Income Portfolio...................... .75 .30(3) 1.05(3)
Growth Portfolio................................. .75 .40(3) 1.15(3)
</TABLE>
- ---------------
1. Management Fees reflect investment advisory fees of .50% which became
effective on and after October 14, 1997. Prior thereto, the investment
advisory fees were .40%.
2. Includes custodial credit percentages as follows: Intermediate Term
Bond -- .0080%; Long Term Bond -- .0043%; Government Securities -- .0169%;
and Money Market -- .0084% which expenses are borne by the Investment
Adviser pursuant to the Investment Advisory Agreement.
3. The Sub-accounts corresponding to these Portfolios first became available
for allocation in November, 1998. These expenses are estimated and reflect
an agreement with the investment adviser to assume expenses which, with the
investment management fee, exceed 1.40% for the Small Company Growth
Portfolio, 1.05% for the Equity Income Portfolio, 1.15% for the Growth
Portfolio, 1.30% for the Capital Appreciation Portfolio, and 1.05% for the
Growth and Income Portfolio. Without the agreement by the investment
adviser to assume such expenses, it is estimated that expenses would be
1.70% for the Small Company Growth Portfolio, 1.45% for the Equity Income
Portfolio, 1.45% for the Growth Portfolio, 1.45% for the Capital
Appreciation Portfolio, and 1.45% for the Growth and Income Portfolio.
These estimates are based upon the assumption that each Portfolio will have
$5,000,000 in assets. Because of fees and expenses that do not vary with
the amount of assets under management, such as custodian and accounting
fees, if average net assets exceed this assumption, fees and expenses as a
percentage of average net assets will decrease; however, if average net
assets are less than this assumption, fees and expenses will increase.
GUARANTEE OF CERTAIN CHARGES
The Company guarantees that certain charges will not increase. This
includes the charge for mortality and expense risks, the administrative charge,
the per $1,000 Specified Amount charge, the Sales Charge, and the guaranteed
cost of insurance rates.
Any changes in the current cost of insurance charges or charges for
optional insurance benefits will be made by class of Insureds and will be based
on changes in future expectations with respect to investment earnings,
mortality, length of time policies will remain in effect, expenses, and taxes.
In no event will they exceed the guaranteed rates defined in the Policy.
33
<PAGE> 39
OTHER INFORMATION
FEDERAL INCOME TAX CONSIDERATIONS
The following discussion provides a general description of the federal
income tax considerations relating to the Policy. This discussion is based upon
the Company's understanding of the present federal income tax laws as they are
currently interpreted by the Internal Revenue Service ("IRS"). This discussion
is not intended as tax advice. Because of the inherent complexity of such laws
and the fact that tax results will vary according to the particular
circumstances of the individual involved, tax advice may be needed by a person
contemplating the purchase of the Policy. It should, therefore, be understood
that these comments concerning federal income tax consequences are not an
exhaustive discussion of all tax questions that might arise under the Policy and
that special rules which are not discussed herein may apply in certain
situations. Moreover, no representation is made as to the likelihood of
continuation of federal income tax or estate or gift tax laws or of the current
interpretations by the IRS or the courts. Future legislation may adversely
affect the tax treatment of life insurance policies or other tax rules described
in this discussion or that relate directly or indirectly to life insurance
policies. Finally, these comments do not take into account any state or local
income tax considerations which may be involved in the purchase of the Policy.
Definition of Life Insurance
Section 7702 of the Internal Revenue Code (the "Code") provides that if (a)
a policy is considered to be life insurance under applicable law and (b) one of
two alternate tests are met, a policy will be treated as a life insurance policy
for federal tax purposes. These tests are referred to as the "Cash Value
Accumulation Test" and the "Guideline Premium/Cash Value Corridor Test".
Under the Cash Value Accumulation Test, there is no limit to the amount
that may be paid in premiums so long as there is enough death benefit in
relation to Fund Value at all times. The death benefit at all times must be at
least equal to an actuarially determined factor (the "death benefit
percentage"), depending on the Insureds' Ages, genders, and underwriting classes
at any point in time, times the Fund Value.
The Guideline Premium/Cash Value Corridor Test provides for, among other
things, (i) a maximum allowable premium per thousand dollars of death benefit,
known as the "guideline annual premium", and (ii) a minimum ongoing "corridor"
of death benefit in relation to the Fund Value of the Policy, known as the
"death benefit percentage." See Appendix B for a table of the Guideline
Premium/Cash Value Corridor Test death benefit percentages.
In most situations, the death benefit that results from the Guideline
Premium/Cash Value Corridor Test will ultimately be less that the amount of
death benefit required under the Cash Value Accumulation Test.
The Policy described in this Prospectus allows the Policy Owner to choose,
at the time of application, which of these tests will apply to the Policy. A
choice of tests is irrevocable. Regardless of the test chosen, the Company
believes that the Policy meets this statutory definition of life insurance and
hence will receive federal income tax treatment consistent with that of fixed
life insurance. Thus, the Death Benefit should be excludable from the gross
income of the Beneficiary (whether the Beneficiary is a corporation, individual
or other entity) under Section 101(a)(1) of the Code for purposes of the regular
Federal income tax and the Policy Owner generally should not be deemed to be in
constructive receipt of the cash values under the Policy until a full surrender
thereof, maturity of the Policy, or Partial Surrender. In addition, certain
Policy loans may be taxable in the case of Policies that are modified endowment
contracts. Prospective Policy Owners that intend to use Policies to fund
deferred compensation arrangements for their employees are urged to consult
their tax advisors with respect to the tax consequences of such arrangements.
Prospective corporate Owners should consult their tax advisors about the
treatment of life insurance in their particular circumstances for purposes of
the alternative minimum tax applicable to corporations.
Diversification Requirements
To comply with regulations under Section 817(h) of the Code, each Portfolio
is required to diversify its investments. Generally, a portfolio is required to
diversify its investments so that on the last day of each
34
<PAGE> 40
quarter of a calendar year, no more than 55% of the value of its assets is
represented by any one investment, no more than 70% is represented by any two
investments, no more than 80% is represented by any three investments, and no
more than 90% is represented by any four investments. Securities of a single
issuer generally are treated for purposes of Section 817(h) as a single
investment. However, for this purpose, each U.S. Government agency or
instrumentality is treated as a separate issuer, and any security issued,
guaranteed, or insured (to the extent so guaranteed or insured) by the U.S. or
by an agency or instrumentality of the U.S. is treated as a security issued by
the U.S. Government or its agency or instrumentality, whichever is applicable.
While there should be no question that, for federal income tax purposes,
the Portfolio shares underlying the Policies are owned by the Company and not by
a Policy Owner or any Beneficiary, no representation is or can be made regarding
the likelihood of the continuation of current interpretations by the IRS.
Tax Treatment of Policies
The Technical and Miscellaneous Revenue Act of 1988 established a new class
of life insurance contracts referred to as modified endowment contracts. With
the enactment of this legislation, the Policies will be treated for tax purposes
in one of two ways. Policies that are not classified as modified endowment
contracts will be taxed as conventional life insurance contracts, as described
below. Taxation of pre-death distributions from Policies that are classified as
modified endowment contracts is somewhat different, as described below.
A life insurance contract becomes a "modified endowment contract" if, at
any time during the first seven contract years, the sum of actual premiums paid
exceeds the sum of the "seven-pay premium." Generally, the "seven-pay premium"
is the level annual premium, such that if paid for each of the first seven
years, will fully pay for all future death and endowment benefits under a
contract. For example, if the "seven-pay premiums" were $1,000, the maximum
premiums that could be paid during the first seven years to avoid "modified
endowment" treatment would be $1,000 in the first year; $2,000 through the first
two years and $3,000 through the first three years, etc. Under this test, a
Policy may or may not be a modified endowment contract, depending on the amount
of premiums paid during each of the Policy's first seven contract years. Changes
in benefits may require retesting to determine if the Policy is to be classified
as a modified endowment contract.
Conventional Life Insurance Policies
If a Policy is not a modified endowment contract, upon full surrender or
maturity of a Policy for its Cash Value, the excess, if any, of the Cash Value
plus any Outstanding Debt over the cost basis under a Policy will be treated as
ordinary income for federal income tax purposes. A Policy's cost basis will
usually equal the premiums paid less any premiums previously recovered through
Partial Surrenders. Under Section 7702 of the Code, special rules apply to
determine whether part or all of the cash received through Partial Surrenders in
the first 15 Policy years is paid out of the income of the Policy and therefore
subject to income tax. Cash distributed to a Policy Owner on Partial Surrenders
occurring more than 15 years after the Policy Date will be taxable as ordinary
income to the Policy Owner to the extent that it exceeds the cost basis under a
Policy.
The Company also believes that loans received under Policies that are not
modified endowment contracts will be treated as indebtedness of the Owner, and
that no part of any loan under the Policy will constitute income to the Owner
unless the Policy is surrendered or upon maturity of the Policy. Interest paid
(or accrued by an accrual basis taxpayer) on a loan under a Policy that is not a
modified endowment contract may be deductible, subject to several limitations,
depending on the use to which the proceeds are put and the tax rules applicable
to the Policy Owner. If, for example, the loan proceeds are used by an
individual for business or investment purposes, all or part of the interest
expense may be deductible. Generally, if the policy loan is used for personal
purposes by an individual, the interest expense is not deductible. The
deductibility of loan interest (whether incurred under a policy loan or on other
indebtedness) also may be subject to other limitations. For example, where the
interest is paid (or accrued by an accrual basis taxpayer) on a loan under a
Policy covering the life of an officer, employee, or person financially
interested in the trade or business of the Policy Owners, the interest may be
deductible to the extent that the interest is attributable to the first $50,000
of the
35
<PAGE> 41
Outstanding Debt, but only for a limited number of Insureds. Other tax law
provisions may limit the deduction of interest payable on loan proceeds that are
used to purchase or carry certain life insurance policies.
Modified Endowment Contracts
Pre-death distributions from modified endowment contracts may give rise to
taxable income. Upon full surrender or maturity of the Policy, the Policy Owner
would recognize ordinary income for federal income tax purposes equal to the
amount by which the Cash Value plus Outstanding Debt exceeds the investment in
the Policy (usually the premiums paid plus certain pre-death distributions that
were taxable less any premiums previously recovered that were excludable from
gross income). Upon Partial Surrenders and policy loans, the Policy Owner would
recognize ordinary income to the extent allocable to income (which includes all
previously non-taxed gains) on the Policy. The amount allocated to income is the
amount by which the Fund Value of the Policy exceeds investment in the Policy
immediately before the distribution. Under a tax law provision, if two or more
policies which are classified as modified endowment contracts are purchased from
any one insurance company, including the Company, during any calendar year, all
such policies will be aggregated for purposes of determining the portion of the
pre-death distributions allocable to income on the policies and the portion
allocable to investment in the policies.
Amounts received under a modified endowment contract that are included in
gross income are subject to an additional tax equal to 10% of the amount
included in gross income, unless an exception applies. The 10% additional tax
does not apply to any amount received: (i) when the taxpayer is at least 59 1/2
years old; (ii) which is attributable to the taxpayer becoming disabled; or
(iii) which is part of a series of substantially equal periodic payments (not
less frequently than annually) made for the life (or life expectancy) of the
taxpayer or the joint lives (or joint life expectancies) of the taxpayer and his
or her beneficiary.
If a Policy was not originally a modified endowment contract but becomes
one, under Treasury Department regulations which are yet to be prescribed,
pre-death distributions received in anticipation of a failure of a Policy to
meet the seven-pay premium test are to be treated as pre-death distributions
from a modified endowment contract (and, therefore, are to be taxable as
described above) even though, at the time of the distribution(s), the Policy was
not yet a modified endowment contract. For this purpose, pursuant to the Code,
any distribution made within two years before the Policy is classified as a
modified endowment contract shall be treated as being made in anticipation of
the Policy's failing to meet the seven-pay premium test.
It is unclear whether interest paid (or accrued by an accrual basis
taxpayer) on Outstanding Debt with respect to a modified endowment contract
constitutes interest for federal income tax purposes. If it does constitute
interest, it may be deductible, subject to several limitations, depending on the
use to which the proceeds are put and the tax rules applicable to the Policy
Owner. If, for example, the loan proceeds are used by an individual for business
or investment purposes, all or part of the interest expense may be deductible.
Generally, if the Policy loan is used for personal purposes by an individual,
the interest expense is not deductible. The deductibility of loan interest
(whether incurred under a Policy loan or on other indebtedness) also may be
subject to other limitations. For example, where the interest is paid (or
accrued by an accrual basis taxpayer) on a loan under a Policy covering the life
of an officer, employee, or person financially interested in the trade or
business of the Policy Owners, the interest may be deductible to the extent that
the interest is attributable to the first $50,000 of the Outstanding Debt. Other
tax law provisions may limit the deduction of interest payable on loan proceeds
that are used to purchase or carry certain life insurance policies.
Reasonableness Requirement for Charges
Another provision of the tax law deals with allowable charges for mortality
costs and other expenses that are used in making calculations to determine
whether a contract qualifies as life insurance for federal income tax purposes.
For life insurance policies entered into on or after October 21, 1988, these
calculations must be based upon reasonable mortality charges and other charges
reasonably expected to be actually paid. The Treasury Department is expected to
promulgate regulations governing reasonableness standards for mortality charges.
The Company believes that the mortality costs and other expenses used in making
calculations to determine whether the Policy qualifies as life insurance meet
the current requirements. It is possible that
36
<PAGE> 42
future regulations will contain standards that would require the Company to
modify its mortality charges used for the purposes of the calculations in order
to retain qualification of the Policy as life insurance for federal income tax
purposes, and the Company reserves the right to make any such modifications.
Riders, Policy Changes, and Transfers
Certain Riders permit the splitting of the policy into two other individual
policies upon divorce, business dissolution, or certain changes in the Federal
estate tax law. The splitting of a Policy could have adverse tax consequences
including but not limited to, the recognition of taxable income in an amount up
to any gain in the policy at the time of the split.
In order for the Beneficiary to receive the tax treatment discussed on
pages 34 to 37, the policy must initially qualify and continue to qualify as
life insurance under Sections 7702 and 817(h) of the Code. The Company may make
changes in the Policy or Riders or make distributions from the Policy to the
extent deemed necessary to qualify the Policy as life insurance for tax
purposes. Any such change will uniformly apply to all policies that are
affected. The Policy Owner will be given advance notice of such changes.
Special tax rules may apply to the transfer of ownership of a Policy.
Consult a qualified tax adviser before any transfer of the Policy.
Other Employee Benefit Programs
Complex rules may apply when a Policy is held by an employer or a trust, or
acquired by an employee, in connection with the provision of employee benefits.
These Policy Owners also must consider whether the Policy was applied for by or
issued to a person having an insurable interest under applicable state law, as
the lack of insurable interest may, among other things, affect the qualification
of the Policy as life insurance for federal income tax purposes and the right of
the beneficiary to death benefits. Employers and employer-created trusts may be
subject to reporting, disclosure, and fiduciary obligations under the Employee
Retirement Income Security Act of 1974 (ERISA). The Policy Owners legal advisor
should be consulted to address these issues.
Other
Federal estate and gift and state and local estate, inheritance, and other
tax consequences of ownership or receipt of Policy proceeds depend on the
jurisdiction and the particular circumstances of each Owner or Beneficiary.
For complete information on federal, state, local and other tax
considerations, a qualified tax advisor should be consulted.
THE COMPANY DOES NOT MAKE ANY GUARANTEE REGARDING
THE TAX STATUS OF ANY POLICY.
CHARGE FOR COMPANY INCOME TAXES
For federal income tax purposes, variable life insurance generally is
treated in a manner consistent with fixed life insurance. The Company will
review the question of a charge to the Variable Account for the Company's
federal income taxes periodically. A charge may be made for any federal income
taxes incurred by the Company that are attributable to the Variable Account.
This might become necessary if the tax treatment of the Company is ultimately
determined to be other than what the Company currently believes it to be, if
there are changes made in the federal income tax treatment of variable life
insurance at the insurance company level, or if there is a change in the
Company's tax status.
Under current laws, the Company may incur state and local taxes (in
addition to premium taxes imposed by the states) in several states. At present,
these taxes are not significant. If there is a material change in
37
<PAGE> 43
applicable state or local tax laws or in the cost to the Company, the Company
reserves the right to charge the Account for such taxes, if any, attributable to
the Account.
VOTING OF FUND SHARES
In accordance with its view of present applicable law, the Company will
exercise voting rights attributable to the shares of each portfolio of the Funds
held in the Subaccounts at any regular and special meetings of the shareholders
of the Funds on matters requiring shareholder voting under the Investment
Company Act of 1940. The Company will exercise these voting rights based on
instructions received from persons having the voting interest in corresponding
Subaccounts of the Variable Account. However, if the Investment Company Act of
1940 or any regulations thereunder should be amended, or if the present
interpretation thereof should change, and as a result the Company determines
that it is permitted to vote the shares of the Funds in its own right, it may
elect to do so.
The person having the voting interest under a Policy is the Policy Owner.
Unless otherwise required by applicable law, the number of votes as to which a
Policy Owner will have the right to instruct for any Portfolio will be
determined by dividing a Policy Owner's Fund Value in the Subaccount which
corresponds to the Portfolio by $100. Fractional votes will be counted. The
number of votes as to which a Policy Owner will have the right to instruct will
be determined as of the date determined by the Company, but in no event shall
such date be more than 90 days prior to the date established by the respective
Fund for determining shareholders eligible to vote at the meeting of the
respective Fund. If required by the Securities and Exchange Commission, the
Company reserves the right to determine in a different fashion the voting rights
attributable to the shares of the respective Fund based upon the instructions
received from Policy Owners. Voting instructions may be cast in person or by
proxy.
Voting rights attributable to the Policy Owner's Fund Value held in each
Subaccount for which no timely voting instructions are received will be voted by
the Company in the same proportion as the voting instructions which are received
in a timely manner for all Policies participating in that Subaccount. The
Company will also exercise the voting rights from assets in each Subaccount
which are not otherwise attributable to Policy Owners, if any, in the same
proportion as the voting instructions which are received in a timely manner for
all Policies participating in that Subaccount and generally will exercise voting
rights attributable to shares of Portfolios of the Funds held in its General
Account, if any, in the same proportion as votes cast with respect to shares of
Portfolios of the Funds held by the Variable Account and other separate accounts
of the Company, in the aggregate.
DISREGARD OF VOTING INSTRUCTIONS
The Company may, when required by state insurance regulatory authorities,
disregard voting instructions if the instructions require that voting rights be
exercised so as to cause a change in the subclassification or investment
objective of a Portfolio or to approve or disapprove an investment advisory
contract. In addition, the Company itself may disregard voting instructions of
changes initiated by Policy Owners in the investment policy or the investment
adviser (or portfolio manager) of a Portfolio, provided that the Company's
disapproval of the change is reasonable and is based on a good faith
determination that the change would be contrary to state law or otherwise
inappropriate, considering the Portfolio's objectives and purpose, and
considering the effect the change would have on the Company. In the event the
Company does disregard voting instructions, a summary of that action and the
reasons for such action will be included in the next report to Policy Owners.
REPORT TO POLICY OWNERS
A statement will be sent at least annually to each Policy Owner setting
forth a summary of the transactions which occurred since the last statement and
indicating the death benefit, Specified Amount, Fund Value, Cash Value, and any
Outstanding Debt. In addition, the statement will indicate the allocation of
Fund Value among the Guaranteed Interest Account, the Loan Account and the
Subaccounts and any other
38
<PAGE> 44
information required by law. Confirmations will be sent out upon premium
payments, transfers, loans, loan repayments, withdrawals, and surrenders.
Each Policy Owner will also receive an annual and a semiannual report
containing financial statements for the Variable Account and the Funds, the
latter of which will include a list of the portfolio securities of the Funds, as
required by the Investment Company Act of 1940, and/or such other reports as may
be required by federal securities laws.
SUBSTITUTION OF INVESTMENTS AND RIGHT TO CHANGE OPERATIONS
The Company reserves the right, subject to compliance with the law as then
in effect, to make additions to, deletions from, or substitutions for the
securities that are held by the Variable Account or any of its other separate
accounts or that the Variable Account or any of its other separate accounts may
purchase. If shares of any or all of the Portfolios of the Funds should no
longer be available for investment, or if, in the judgment of the Company's
management, further investment in shares of any or all Portfolios of the Funds
should become inappropriate in view of the purposes of the Policies, the Company
may substitute shares of another Portfolio of the Funds or of a different fund
for shares already purchased, or to be purchased in the future under the
Policies.
Where required, the Company will not substitute any shares attributable to
a Policy Owner's interest in a Variable Account without notice, Policy Owner
approval, or prior approval of the Securities and Exchange Commission and
without following the filing or other procedures established by applicable state
insurance regulators. Applicable state insurance regulators include the
Commissioner of Insurance of the State of Arizona.
The Company also reserves the right to establish additional Subaccounts of
the Variable Account, each of which would invest in a new portfolio of the
Funds, or in shares of another investment company, a portfolio thereof, or
another suitable investment vehicle, with a specified investment objective. New
Subaccounts may be established when, in the sole discretion of the Company,
marketing needs or investment conditions warrant, and any new Subaccounts will
be made available to existing Policy Owners on a basis to be determined by the
Company. The Company may also eliminate one or more Subaccounts if, in its sole
discretion, marketing, tax, or investment conditions so warrant.
In the event of any such substitution or change, the Company may, by
appropriate endorsement, make such changes in this and other policies as may be
necessary or appropriate to reflect such substitution or change. If deemed by
the Company to be in the best interests of persons having voting rights under
the Policies, the Variable Account may be operated as a management investment
company under the Investment Company Act of 1940 or any other form permitted by
law, it may be deregistered under that Act in the event such registration is no
longer required, or it may be combined with other separate accounts of the
Company or an affiliate thereof. Subject to compliance with applicable law, the
Company also may combine one or more Subaccounts and may establish a committee,
board, or other group to manage one or more aspects of the operation of the
Variable Account.
CHANGES TO COMPLY WITH LAW
The Company reserves the right to make any change without consent of Policy
Owners to the provisions of the Policy to comply with, or give Policy Owners the
benefit of, any Federal or State statute, rule, or regulation, including but not
limited to requirements for life insurance contracts under the Internal Revenue
Code, under regulations of the United States Treasury Department or any state.
PERFORMANCE INFORMATION
Performance information for the Subaccounts of the Variable Account may
appear in advertisements, sales literature, or reports to Policy Owners or
prospective purchasers. Performance information in advertisements or sales
literature may be expressed in any fashion permitted under applicable law, which
may include presentation of a change in a Policy Owner's Fund Value attributable
to the performance of one or more
39
<PAGE> 45
Subaccounts, or as a change in Policy Owner's death benefit. Performance
quotations may be expressed as a change in a Policy Owner's Fund Value over time
or in terms of the average annual compounded rate of return on the Policy
Owner's Fund Value, based upon a hypothetical Policy in which premiums have been
allocated to a particular Variable Account over certain periods of time that
will include one, five and ten years, or from the commencement of operation of
the Variable Account if less than one, five, or ten years. Any such quotation
may reflect the deduction of all applicable charges to the Policy including
premium load, the cost of insurance, the administrative charge, and the
mortality and expense risk charge. The quotation may also reflect the deduction
of the Surrender Charge, if applicable, by assuming a surrender at the end of
the particular period, although other quotations may simultaneously be given
that do not assume a surrender and do not take into account deduction of the
Surrender Charge.
Performance information for the Variable Account may be compared, in
advertisements, sales literature, and reports to Policy Owners to: (i) other
variable life separate accounts or investment products tracked by research
firms, ratings services, companies, publications, or persons who rank separate
accounts or investment products on overall performance or other criteria; and
(ii) the Consumer Price Index (measure for inflation) to assess the real rate of
return from the purchase of a Policy. Reports and promotional literature may
also contain the Company's rating or a rating of the Company's claim paying
ability as determined by firms that analyze and rate insurance companies and by
nationally recognized statistical rating organizations.
Performance information for any Subaccount of the Variable Account reflects
only the performance of a hypothetical Policy whose Fund Value is allocated to
the Variable Account during a particular time period on which the calculations
are based. Performance information should be considered in light of the
investment objectives and policies, characteristics and quality of the
Portfolios of the Funds in which the Variable Account invests, and the market
conditions during the given period of time, and should not be considered as a
representation of what may be achieved in the future.
THE GUARANTEED INTEREST ACCOUNT
Policy Owners may allocate all or a portion of their net premiums and
transfer Fund Value to the Guaranteed Interest Account of the Company. Amounts
allocated to the Guaranteed Interest Account become part of the "General
Account" of the Company, which supports insurance and annuity obligations. The
amounts allocated to the General Account of the Company are subject to the
liabilities arising from the business the Company conducts. Descriptions of the
Guaranteed Interest Account are included in this Prospectus for the convenience
of the Purchaser. The Guaranteed Interest Account and the General Account of the
Company have not been registered under the Securities Act of 1933 and the
Investment Company Act of 1940. Accordingly, neither the Guaranteed Interest
Account nor any interest therein is generally subject to the provisions of these
Acts and, as a result, the staff of the Securities and Exchange Commission has
not reviewed the disclosure in this prospectus relating to the Guaranteed
Interest Account. Disclosures regarding the Guaranteed Interest Account may,
however, be subject to certain generally applicable provisions of the federal
securities laws relating to the accuracy and completeness of statements made in
the prospectus. For more details regarding the Guaranteed Interest Account, see
the Policy.
GENERAL DESCRIPTION
Amounts allocated to the Guaranteed Interest Account become part of the
General Account of Company which consists of all assets owned by the Company
other than those in the Variable Account and other separate accounts of the
Company. Subject to applicable law, the Company has sole discretion over the
investment of the assets of its General Account.
The Policy Owner may elect to allocate net premiums to the Guaranteed
Interest Account, the Variable Account, or both. The Policy Owner may also
transfer Fund Value from the Subaccounts of the Variable Account to the
Guaranteed Interest Account, or from the Guaranteed Interest Account to the
Subaccounts. Company guarantees that the Fund Value in the Guaranteed Interest
Account will be credited with a minimum interest rate of 0.0121% daily,
compounded daily, for a minimum effective annual rate of 4.5%. Such interest
will be paid regardless of the actual investment experience of the Guaranteed
Interest Account.
40
<PAGE> 46
In addition, Company may in its sole discretion declare current interest in
excess of the 4.5% annual rate, which will be guaranteed for approximately one
year. (The portion of a Policy Owner's Fund Value that has been used to secure
Outstanding Debt will be credited with a guaranteed interest rate of 0.0121%
daily, compounded daily, for a minimum effective annual rate of 4.5%.)
The Company bears the full investment risk for the Fund Value allocated to
the Guaranteed Interest Account.
DEATH BENEFIT
The Death Benefit under the Policy will be determined in the same fashion
for a Policy Owner who has Fund Value in the Guaranteed Interest Account as for
a Policy Owner who has Fund Value in the Subaccounts. The Death Benefit under
Option 1 will be equal to the Specified Amount of the Policy on the date of
death of the last surviving Insured or, if greater, the Fund Value on the date
of death of the last surviving Insured multiplied by a death benefit percentage.
Under Option 2, the Death Benefit will be equal to the Specified Amount of the
Policy on the date of death of the last surviving Insured plus the Fund Value on
the date of death of the last surviving Insured or, if greater, the Fund Value
on the date of death of the last surviving Insured multiplied by a death benefit
percentage. See "Death Benefits under the Policy," page 18.
POLICY CHARGES
Deductions from premium and monthly deductions from the Fund Value will be
the same for Policy Owners who allocate net premiums or transfer Fund Value to
the Guaranteed Interest Account as for Policy Owners who allocate net premiums
to the Subaccounts. These charges include the sales and tax charges; the charges
for the cost of insurance, administrative charge, per $1,000 Specified Amount
charge, the Surrender Charge, and the charge for any other optional insurance
benefits added by Rider. Fees for Partial Surrenders and, if applicable,
transfer charges, will also be deducted from the Guaranteed Interest Account.
Charges applicable to the Portfolios, including the operating expenses of
the Portfolios, as well as the investment advisory fee charged by the Portfolio
managers, will not be paid directly or indirectly by Policy Owners to the extent
the Fund Value is allocated to the Guaranteed Interest Account. Likewise, the
mortality and expense risk charge applicable to the Fund Value allocated to the
Subaccounts is not deducted from Fund Value allocated to the Guaranteed Interest
Account. Any amounts that the Company pays for income taxes allocable to the
Subaccounts will not be charged against the Guaranteed Interest Account.
However, it is important to remember that Policy Owners will not participate in
the investment experience of the Subaccounts to the extent that Fund Values are
allocated to the Guaranteed Interest Account.
TRANSFERS
Amounts may be transferred after the Right to Return Policy Period from the
Subaccounts to the Guaranteed Interest Account and from the Guaranteed Interest
Account to the Subaccounts, subject to the following limitations.
Transfers to the Guaranteed Interest Account may be made at any time and in
any amount.
Transfers from the Guaranteed Interest Account to the Subaccounts are
limited to one in any Policy year. Transfers from the Guaranteed Interest
Account may only be made during the time period which begins on the Policy
Anniversary and which ends 30 days after the Policy Anniversary. If the transfer
request is received on the Policy Anniversary, it will be processed as of the
Policy Anniversary; if it is received within 30 days after the Policy
Anniversary, the transfer will be effective as of the close of business on the
date received if it is a Business Day, or if not a Business Day, then at the
close of business on the next day which is a Business Day. Any request received
within 10 days before the Policy Anniversary will be deemed received on the
Policy Anniversary. Any transfer requests received at other times will not be
honored, and will be returned to the Policy Owner.
Currently there is no charge imposed upon transfers; however, the Company
reserves the right to assess such a charge in the future.
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<PAGE> 47
SURRENDERS AND POLICY LOANS
The Policy Owner may also make full surrenders and Partial Surrenders from
the Guaranteed Interest Account to the same extent as a Policy Owner who has
invested in the Subaccounts. See "Full Surrender," page 26 and "Partial
Surrender," page 27. Transfers and surrenders payable from the Guaranteed
Interest Account, and the payment of Policy loans allocated to the Guaranteed
Interest Account, may be delayed for up to six months. However, with respect to
Policies issued for delivery to residents of the Commonwealth of Pennsylvania,
the Company will not delay payment of surrenders or loans, the proceeds of which
will be used to pay premiums on the Policy.
MORE ABOUT THE POLICY
OWNERSHIP
The Policy Owner is the person named as such in the application or in any
later change shown in the Company's records. While either or both of the
Insureds is living, the Policy Owner alone has the right to receive all benefits
and exercise all rights that the Policy grants or the Company allows.
Joint Owners
If more than one person is named as Policy Owner, they are joint owners.
Any Policy transaction requires the signature of all persons named jointly.
Unless otherwise provided, if a joint owner dies, ownership passes to the
surviving joint owner(s). When the last joint owner dies, ownership passes
through that person's estate, unless otherwise provided.
BENEFICIARY
The Beneficiary is the individual named as such in the application or any
later change shown in the Company's records. The Policy Owner may change the
Beneficiary at any time while either or both of Insureds is living by written
request on forms provided by the Company, which must be received by the Company
at its Administrative Office. The change will be effective as of the date this
form is signed. Contingent and/or concurrent Beneficiaries may be designated.
The Policy Owner may designate a permanent Beneficiary, whose rights under the
Policy cannot be changed without his or her consent. Unless otherwise provided,
if no designated Beneficiary is living upon the death of the last surviving
Insured, the Policy Owner or the Policy Owner's estate is the Beneficiary.
The Company will pay the death benefit proceeds to the Beneficiary. Unless
otherwise provided, in order to receive proceeds at the last surviving Insured's
death, the Beneficiary must be living at the time of the last surviving
Insured's death.
THE POLICY
This Policy is a contract between the Policy Owner and the Company. The
entire contract consists of the Policy, a copy of the initial application, all
subsequent applications to change the Policy, any endorsements, all Riders, and
all additional Policy information sections (specification pages) added to the
Policy.
NOTIFICATION AND CLAIMS PROCEDURES
Any election, designation, change, assignment, or request made by the
Policy Owner must be in writing on a form acceptable to the Company. The Company
is not liable for any action taken before such written notice is received and
recorded. The Company may require that the Policy be returned for any Policy
change or upon its surrender.
In the event of the last surviving Insured's death while the Policy is in
force notice should be given to the Company as soon as possible. Claim procedure
instructions will be sent immediately. As due proof of death, the Company may
require proof of Age and a certified copy of a death certificate for each
Insured. The
42
<PAGE> 48
Company may also require the Beneficiary and the last surviving Insured's next
of kin to sign authorizations as part of this process. These authorization forms
allow the Company to obtain information about the Insured, including but not
limited to medical records of physicians and hospitals used by the Insureds.
PAYMENTS
The Company will pay death benefit proceeds, the Cash Value on surrender,
Partial Surrenders, and loan proceeds based on allocations made to the
Subaccounts, and will effect a transfer between Subaccounts or from the Variable
Account to the Guaranteed Interest Account within seven days after the Company
receives all the information needed to process a payment.
However, the Company can postpone the calculation or payment of such a
payment or transfer of amounts based on investment performance of the
Subaccounts if:
The New York Stock Exchange is closed on other than customary weekend
and holiday closing or trading on the New York Stock Exchange is restricted
as determined by the SEC; or
An emergency exists, as determined by the SEC, as a result of which
disposal of securities is not reasonably practicable or it is not
reasonably practicable to determine the value of the Account's net assets;
or
PAYMENT PLAN/SETTLEMENT PROVISIONS
Maturity or surrender benefits may be used to purchase a payment plan
providing monthly income for the lifetime of the Beneficiary. The monthly
payments consisting of proceeds plus interest will be paid in equal installments
for at least ten years. The purchase rates for the payment plan are guaranteed
not to exceed those shown in the Policy, but current rates that are lower (i.e.,
providing greater income) may be established by the Company from time to time.
This benefit is not available if the income would be less than $25 per payment a
month or if the proceeds are less than $1,000. Maturity or surrender benefits or
death benefit proceeds may be used to purchase any other payment plan that the
Company makes available at that time.
PAYMENT IN CASE OF SUICIDE
If either Insured dies by suicide, within two years from the Policy Date or
Reinstatement Date, the Company will limit the Death Benefit proceeds to the
premium payments less any Partial Surrender amounts (and their fees) and less
any Outstanding Debt. If an Insured dies by suicide, within two years of the
effective date of any increase in Specified Amount, the Company will refund the
cost of insurance charges made with respect to such increase. Subject to terms
and conditions set forth in the Policy, the Company will make coverage available
to any surviving Insured, if the surviving Insured elects such coverage within
60 days after the suicide.
ASSIGNMENT
The Policy Owner may assign a Policy as collateral security for a loan or
other obligation. No assignment will bind the Company unless the original, or a
copy, is received at the Company's Administrative Office, and it will be
effective only when recorded by the Company. An assignment does not change the
ownership of the Policy. However, after an assignment, the rights of any Policy
Owner or Beneficiary will be subject to the assignment. The entire Policy,
including any attached payment option or Rider, will be subject to the
assignment. The Company will rely solely on the assignee's statement as to the
amount of the assignee's interest. The Company will not be responsible for the
validity of any assignment. Unless otherwise provided, the assignee may exercise
all rights this Policy grants except (a) the right to change the Policy Owner or
Beneficiary; and (b) the right to elect a payment option. Assignment of a Policy
that is a modified endowment contract may generate taxable income. (See "Federal
Income Tax Considerations", page 34.)
ERRORS ON THE APPLICATION
If the Age or gender of an Insured has been misstated, the death benefit
under this Policy will be the greater of that which would be purchased by the
most recent cost of insurance charge at the correct age and
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<PAGE> 49
gender, or the death benefit derived by multiplying the Fund Value by the death
benefit percentage for the correct Age and gender. If unisex cost of insurance
rates apply, no adjustment will be made for a misstatement of gender. See "Cost
of Insurance", page 30.
INCONTESTABILITY
The Company may contest the validity of this Policy if any material
misstatements are made in the application. However, the Policy will be
incontestable as follows: the initial Specified Amount cannot be contested after
the Policy has been in force during an Insured's lifetime for two years from the
Policy Date; and an increase in the Specified Amount or any reinstatement cannot
be contested after the increase or the reinstated policy has been in force
during an Insured's lifetime for two years from its effective date.
POLICY ILLUSTRATIONS
Upon request, the Company will send the Policy Owner an illustration of
future benefits under the Policy based on both guaranteed and current cost
assumptions.
DISTRIBUTION OF THE POLICY
MONY Securities Corp. ("MSC"), a wholly owned subsidiary of MONY, is
principal underwriter (distributor) of the Policies. MSC is registered as a
broker-dealer under the Securities Exchange Act of 1934 and is a member of the
National Association of Securities Dealers. The Policies are sold by individuals
who are registered representatives of MSC and who are also licensed as life
insurance agents for the Company. The Policies may also be sold through other
broker/dealers authorized by MSC and applicable law to do so.
Except where MSC has authorized other broker/dealers to sell the Policies
(as described in the preceding paragraph), compensation payable for the sale of
the Policies will be based upon the following schedule. After issue of the
Contract first Policy year, commissions will equal at most 50 percent of
premiums paid up to the Target Premium and 3% of any amount in excess of the
Target Premium. Thereafter, commissions will equal at most 3.0 percent of any
additional premiums plus, on the sixth and each succeeding Policy Anniversary
for so long as the Policy shall remain in force, .15 percent of the Fund Value
less Loan Account Value. Upon any subsequent increase in Specified Amount,
commissions in the first year following the increase will equal at most 50
percent of premiums paid on or after the increase up to the amount by which the
Target Premium has been increased. Thereafter, commissions will return to no
more than the 3.0 percent level. Further, registered representatives may be
eligible to receive certain bonuses and other benefits based on the amount of
earned commissions.
In addition, registered representatives who meet specified production
levels may qualify, under sales incentive programs adopted by Company, to
receive noncash compensation such as expense-paid trips, expense-paid
educational seminars and merchandise. Company makes no separate deductions,
other than previously described, from premiums to pay sales commissions or sales
expenses.
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<PAGE> 50
MORE ABOUT THE COMPANY
MANAGEMENT
The directors and officers of the Company are listed below. The business
address for all directors and officers of MONY Life Insurance Company of America
is 1740 Broadway, New York, New York 10019.
Current Officers and Directors of MONY America are:
<TABLE>
<CAPTION>
NAME POSITION AND OFFICES WITH DEPOSITOR
- ---- -----------------------------------
<S> <C>
Michael I. Roth........................... Director, Chairman and Chief Executive Officer
Samuel J. Foti............................ Director, President and Chief Operating Officer
Richard E. Connors........................ Director
Richard Daddario.......................... Director, Vice President, and Controller
Phillip A. Eisenberg...................... Director, Vice President and Actuary
Margaret G. Gale.......................... Director, Vice President
Michael Slipowitz......................... Vice President
Stephen J. Hall........................... Director
Edward E. Hill............................ Vice President -- Chief Compliance Officer
Evelyn L. Peos............................ Vice President
Kenneth M. Levine......................... Director and Executive Vice President
David S. Waldman.......................... Secretary
David V. Weigel........................... Treasurer
Sam Chiodo................................ Vice President
Charles P. Leone.......................... Director, Vice President and Chief Corporate
Compliance Officer
</TABLE>
No officer or director listed above receives any compensation from the
Variable Account. No separately allocable compensation has been paid by the
Company or any of its affiliates to any person listed for services rendered to
the Account.
STATE REGULATION
The Company is subject to the laws of the state of Arizona governing
insurance companies and to regulation by the Commissioner of Insurance of
Arizona. In addition, it is subject to the insurance laws and regulations of the
other states and jurisdictions in which it is licensed or may become licensed to
operate. An annual statement in a prescribed form must be filed with the
Commissioner of Insurance of Arizona and with regulatory authorities of other
states on or before March 1st in each year. This statement covers the operations
of the Company for the preceding year and its financial condition as of December
31st of that year. The Company's affairs are subject to review and examination
at any time by the Commissioner of Insurance or his agents, and subject to full
examination of Company's operations at periodic intervals.
TELEPHONE TRANSFER PRIVILEGES
A Policy Owner may request a transfer of Fund Value or change allocation
instructions for future premiums by telephone if an authorization for telephone
transfer form has been completed, signed, and received at the Company's Syracuse
Operations Center. All or part of any telephone conversation with respect to
transfer and allocation instructions may be recorded by the Company. Telephone
instructions received by the Company by 4:00 p.m. Eastern time on any Valuation
Date will be effected as of the end of that Valuation Date in accordance with
the Policy Owner's instructions, subject to the limitations stated in this
prospectus (presuming that the Right to Return Policy Period has expired). The
Company reserves the right to deny any telephone transfer or allocation request.
If all telephone lines are busy (which might occur, for example, during periods
of substantial market fluctuations), Policy Owners might not be able to request
transfers by telephone and would have to submit written requests. Telephone
transfer and allocation instructions will only be accepted if complete and
correct.
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<PAGE> 51
The Company has adopted guidelines relating to telephone transfers and
allocation instructions that, among other things, outlines procedures to be
followed which are designed, and which the Company believes are reasonable, to
prevent unauthorized instructions. If these procedures are followed, the Company
shall not be liable for, and the Policy Owner will therefore bear the entire
risk of, any loss as a result of the Company's following telephone instructions
in the event that such instructions prove to be fraudulent. A copy of the
guidelines and the Company's form for electing telephone transfer privileges is
available from licensed agents of the Company who are also registered
representatives of MSC or by calling 1-800-487-6669. The Company's form must be
signed and received at the Company's Syracuse Operations Center before telephone
transfers will be accepted.
LEGAL PROCEEDINGS
There are no legal proceedings pending to which the Variable Account is a
party, or which would materially affect the Variable Account.
LEGAL MATTERS
Legal matters in connection with the issue and sale of the Policies
described in this Prospectus and the organization of the Company, its authority
to issue the Policies under Arizona law, and the validity of the forms of the
Policies under Arizona law have been passed on by the Vice President and Deputy
General Counsel of MONY.
Legal matters relating to the federal securities and federal income tax
laws have been passed upon by Edward P. Bank, Vice President and Deputy General
Counsel of MONY.
REGISTRATION STATEMENT
A Registration Statement under the Securities Act of 1933 has been filed
with the SEC relating to the offering described in this Prospectus. This
Prospectus does not include all of the information set forth in the Registration
Statement, as portions have been omitted pursuant to the rules and regulations
of the SEC. The omitted information may be obtained at the SEC's principal
office in Washington, D.C., upon payment of the SEC's prescribed fees.
INDEPENDENT ACCOUNTANTS
The audited financial statements for the Variable Account and for Company
included in this Prospectus and in the Registration Statement have been audited
by PricewaterhouseCoopers LLP, independent accountants, as indicated in their
report hereon, and are included in reliance upon the authority of said firm as
experts in accounting and auditing. PricewaterhouseCoopers LLP's office is
located at 1301 Avenue of the Americas, New York, New York, 10019.
FINANCIAL STATEMENTS
The audited financial statements for the Variable Account are set forth
herein, starting on page F-1. The audited financial statements of the Company
are set forth herein starting on page F-2.
The financial statements of the Variable Account and Company have been
audited by PricewaterhouseCoopers LLP. The financial statements of the Company
should be distinguished from the financial statements of the Variable Account
and should be considered only as bearing upon the ability of the Company to meet
its obligations under the Policies.
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<PAGE> 52
FINANCIAL STATEMENTS AND NOTES TO FINANCIAL STATEMENTS
INDEX TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
With respect to MONY America Variable Account L:
Report of Independent Accountants......................... F-2
Statements of assets and liabilities as of December 31,
1997................................................... F-3
Statements of operations for the year ended December 31,
1997................................................... F-5
Statements of changes in net assets for the years ended
December 31, 1997 and 1996............................. F-7
Notes to financial statements............................. F-10
Report of Independent Accountants......................... F-13
Statements of assets and liabilities as of December 31,
1996................................................... F-14
Statements of operations for the year ended December 31,
1996................................................... F-16
Statements of changes in net assets for the years ended
December 31, 1996 and 1995............................. F-18
Notes to financial statements............................. F-21
Report of Independent Accountants......................... F-24
Statements of assets and liabilities as of December 31,
1995................................................... F-25
Statements of operations for the year ended December 31,
1995................................................... F-27
Statements of changes in net assets for the years ended
December 31, 1995 and 1994............................. F-29
Notes to financial statements............................. F-31
Statement of assets and liabilities as of September 30,
1998 (unaudited)....................................... F-34
Statements of operations for the nine months ended
September 30, 1998 (unaudited)......................... F-36
Statements of changes in net assets for the nine months
ended September 30, 1998 (unaudited) and for the year
ended December 31, 1997................................ F-38
Notes to financial statements............................. F-41
With respect to MONY Life Insurance Company of America:
Report of Independent Accountants......................... F-44
Statements of admitted assets, liabilities, capital and
surplus as of December 31, 1997 and 1996............... F-45
Statements of operations for the years ended December 31,
1997 and 1996.......................................... F-46
Statements of capital and surplus for the years ended
December 31, 1997 and 1996............................. F-47
Statements of cash flows for the years ended December 31,
1997 and 1996.......................................... F-48
Notes to financial statements............................. F-49
Unaudited interim statement of admitted assets,
liabilities, capital and surplus as of
September 30, 1998..................................... F-64
Unaudited interim statements of operations for the nine
months ended September 30, 1998 and 1997............... F-65
Unaudited interim statements of capital and surplus for
the nine months ended September 30, 1998 and 1997...... F-66
Unaudited interim statements of cash flows for the nine
months ended September 30, 1998
and 1997............................................... F-67
Notes to unaudited interim financial statements........... F-68
</TABLE>
F-1
<PAGE> 53
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors of
MONY Life Insurance Company of America and the
Contractholders of MONY America Variable Account L -- Variable Life/Variable
Universal Life:
We have audited the accompanying statements of assets and liabilities of
MONY America Variable Account L -- Variable Life/Variable Universal Life
(comprising, respectively, the Variable Life's Equity Growth, Equity Income,
Intermediate Term Bond, Long Term Bond, Diversified and Money Market Subaccounts
and the Variable Universal Life's Intermediate Term Bond, Long Term Bond,
Government Securities, Money Market, Equity, Small Cap, Managed, International
Growth and High Yield Bond Subaccounts) as of December 31, 1997, the related
statements of operations for the year then ended and the statements of changes
in net assets for each of the two years in the period then ended. These
financial statements are the responsibility of MONY America's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. Our procedures included
confirmation of securities owned as of December 31, 1997, by correspondence with
the custodian. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of each of the respective
subaccounts constituting MONY America Variable Account L -- Variable
Life/Variable Universal Life as of December 31, 1997, the results of their
operations and the changes in their net assets for each of the periods referred
to above, in conformity with generally accepted accounting principles.
COOPERS & LYBRAND L.L.P.
New York, New York
February 11, 1998
F-2
<PAGE> 54
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF ASSETS AND LIABILITIES
DECEMBER 31, 1997
<TABLE>
<CAPTION>
VARIABLE LIFE
------------------------------------------------------------------------------
EQUITY EQUITY INTERMEDIATE LONG TERM MONEY
GROWTH INCOME TERM BOND BOND DIVERSIFIED MARKET
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------- ---------- ------------ ---------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Investments at cost (Note 4)..... $ 546,247 $ 487,414 $ 148,164 $ 63,055 $ 806,595 $ 75,563
========= ========= ========= ========= ========== =========
Investments in MONY Series Fund,
Inc. at net asset value (Note
2)............................. $ 798,134 $ 705,660 $ 156,537 $ 71,555 $1,111,163 $ 75,563
Amount due from MONY Series Fund,
Inc. .......................... 9 9 0 0 26 0
--------- --------- --------- --------- ---------- ---------
Total assets........... 798,143 705,669 156,537 71,555 1,111,189 75,563
--------- --------- --------- --------- ---------- ---------
LIABILITIES
Amount due to MONY America....... 9 9 0 0 26 0
--------- --------- --------- --------- ---------- ---------
Net assets....................... $ 798,134 $ 705,660 $ 156,537 $ 71,555 $1,111,163 $ 75,563
========= ========= ========= ========= ========== =========
Net assets consist of:
Contractholders' net
payments.................... $ 537,453 $ 445,418 $ 192,229 $ 108,555 $ 933,695 $ 198,422
Cost of insurance withdrawals
(Note 3).................... (383,528) (486,949) (201,904) (156,404) (916,797) (200,035)
Undistributed net investment
income...................... 168,021 327,758 163,834 100,095 533,506 77,176
Accumulated net realized gain
(loss) on investments....... 224,301 201,187 (5,995) 10,809 256,191 0
Unrealized appreciation of
investments................. 251,887 218,246 8,373 8,500 304,568 0
--------- --------- --------- --------- ---------- ---------
Net assets....................... $ 798,134 $ 705,660 $ 156,537 $ 71,555 $1,111,163 $ 75,563
========= ========= ========= ========= ========== =========
Number of units outstanding* .... 14,506 12,292 6,639 2,334 28,291 4,207
--------- --------- --------- --------- ---------- ---------
Net asset value per unit
outstanding* .................. $ 55.02 $ 57.41 $ 23.58 $ 30.65 $ 39.28 $ 17.96
========= ========= ========= ========= ========== =========
</TABLE>
- ---------------
* Units outstanding have been rounded for presentation purposes.
See notes to financial statements.
F-3
<PAGE> 55
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF ASSETS AND LIABILITIES (CONTINUED)
DECEMBER 31, 1997
<TABLE>
<CAPTION>
VARIABLE UNIVERSAL LIFE
----------------------------------------------------------------------------------------------
INTERMEDIATE LONG TERM GOVERNMENT MONEY
TERM BOND BOND SECURITIES MARKET EQUITY SMALL CAP MANAGED
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------ ---------- ---------- ---------- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Investments at cost (Note 4)...... $229,105 $ 870,461 $482,067 $3,698,674 $15,117,468 $ 7,542,179 $ 54,701,619
======== ========= ======== ========== =========== =========== ============
Investments in Enterprise
Accumulation Trust at net asset
value (Note 2).................. $ 0 $ 0 $ 0 $ 0 $16,482,798 $ 8,184,725 $ 60,069,001
Investments in MONY Series Fund,
Inc. at net asset value (Note
2).............................. 234,365 948,462 498,405 3,698,674 0 0 0
Amount due from Enterprise
Accumulation Trust.............. 0 0 0 0 3,531 859 9,107
Amount due from MONY America...... 48 418 202 80,882 25,829 2,025 37,486
Amount due from MONY Series Fund,
Inc............................. 11 130 41 11,681 0 0 0
-------- --------- -------- ---------- ----------- ----------- ------------
Total assets.............. 234,424 949,010 498,648 3,791,237 16,512,158 8,187,609 60,115,594
-------- --------- -------- ---------- ----------- ----------- ------------
LIABILITIES
Amount due to Enterprise
Accumulation Trust.............. 0 0 0 0 25,829 2,025 37,486
Amount due to MONY America........ 11 130 41 11,681 3,531 859 9,107
Amount due to MONY Series Fund,
Inc............................. 48 418 202 80,882 0 0 0
-------- --------- -------- ---------- ----------- ----------- ------------
Total liabilities......... 59 548 243 92,563 29,360 2,884 46,593
-------- --------- -------- ---------- ----------- ----------- ------------
Net assets........................ $234,365 $ 948,462 $498,405 $3,698,674 $16,482,798 $ 8,184,725 $ 60,069,001
======== ========= ======== ========== =========== =========== ============
Net assets consist of:
Contractholders' net
payments...................... $265,298 $ 982,905 $552,598 $4,020,118 $16,582,774 $ 7,692,676 $ 58,710,094
Cost of insurance withdrawals
(Note 3)...................... (43,218) (167,996) (91,027) (544,035) (2,948,581) (1,239,409) (10,471,466)
Undistributed net investment
income........................ 6,097 47,307 14,524 222,591 538,907 705,833 2,719,621
Accumulated net realized gain on
investments................... 928 8,245 5,972 0 944,368 383,079 3,743,370
Unrealized appreciation
(depreciation) of
investments................... 5,260 78,001 16,338 0 1,365,330 642,546 5,367,382
-------- --------- -------- ---------- ----------- ----------- ------------
Net assets........................ $234,365 $ 948,462 $498,405 $3,698,674 $16,482,798 $ 8,184,725 $ 60,069,001
======== ========= ======== ========== =========== =========== ============
Number of units outstanding* ..... 19,650 69,779 42,420 325,979 821,090 449,403 2,954,670
-------- --------- -------- ---------- ----------- ----------- ------------
Net asset value per unit
outstanding* ................... $ 11.93 $ 13.59 $ 11.75 $ 11.35 $ 20.07 $ 18.21 $ 20.33
======== ========= ======== ========== =========== =========== ============
<CAPTION>
VARIABLE UNIVERSAL LIFE
--------------------------
INTERNATIONAL HIGH YIELD
GROWTH BOND
SUBACCOUNT SUBACCOUNT
------------- ----------
<S> <C> <C>
ASSETS
Investments at cost (Note 4)...... $4,186,777 $1,900,963
========== ==========
Investments in Enterprise
Accumulation Trust at net asset
value (Note 2).................. $4,079,254 $1,939,719
Investments in MONY Series Fund,
Inc. at net asset value (Note
2).............................. 0 0
Amount due from Enterprise
Accumulation Trust.............. 308 240
Amount due from MONY America...... 214 71
Amount due from MONY Series Fund,
Inc............................. 0 0
---------- ----------
Total assets.............. 4,079,776 1,940,030
---------- ----------
LIABILITIES
Amount due to Enterprise
Accumulation Trust.............. 214 71
Amount due to MONY America........ 308 240
Amount due to MONY Series Fund,
Inc............................. 0 0
---------- ----------
Total liabilities......... 522 311
---------- ----------
Net assets........................ $4,079,254 $1,939,719
========== ==========
Net assets consist of:
Contractholders' net
payments...................... $4,679,851 $2,041,929
Cost of insurance withdrawals
(Note 3)...................... (773,836) (338,204)
Undistributed net investment
income........................ 115,713 160,937
Accumulated net realized gain on
investments................... 165,049 36,301
Unrealized appreciation
(depreciation) of
investments................... (107,523) 38,756
---------- ----------
Net assets........................ $4,079,254 $1,939,719
========== ==========
Number of units outstanding* ..... 290,466 138,275
---------- ----------
Net asset value per unit
outstanding* ................... $ 14.04 $ 14.03
========== ==========
</TABLE>
- ---------------
* Units outstanding have been rounded for presentation purposes.
See notes to financial statements.
F-4
<PAGE> 56
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1997
<TABLE>
<CAPTION>
VARIABLE LIFE
------------------------------------------------------------------------------
EQUITY EQUITY INTERMEDIATE LONG TERM MONEY
GROWTH INCOME TERM BOND BOND DIVERSIFIED MARKET
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------- ---------- ------------ ---------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Dividend income.................... $ 57,504 $ 80,960 $ 10,378 $ 5,654 $ 84,416 $ 4,176
Mortality and expense risk charges
(Note 3)......................... (4,464) (4,333) (1,004) (507) (6,671) (487)
-------- --------- -------- -------- --------- --------
Net investment income.............. 53,040 76,627 9,374 5,147 77,745 3,689
-------- --------- -------- -------- --------- --------
Realized and unrealized gain on
investments (Note 2):
Proceeds from sales.............. 87,998 205,963 55,717 38,794 311,417 32,317
Cost of shares sold.............. (54,391) (121,259) (54,045) (35,014) (211,325) (32,317)
-------- --------- -------- -------- --------- --------
Net realized gain on investments... 33,607 84,704 1,672 3,780 100,092 0
Net increase in unrealized
appreciation of investments...... 101,936 32,332 288 649 59,772 0
-------- --------- -------- -------- --------- --------
Net realized and unrealized gain on
investments...................... 135,543 117,036 1,960 4,429 159,864 0
-------- --------- -------- -------- --------- --------
Net increase in net assets
resulting from operations........ $188,583 $ 193,663 $ 11,334 $ 9,576 $ 237,609 $ 3,689
======== ========= ======== ======== ========= ========
</TABLE>
See notes to financial statements.
F-5
<PAGE> 57
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF OPERATIONS (CONTINUED)
FOR THE YEAR ENDED DECEMBER 31, 1997
<TABLE>
<CAPTION>
VARIABLE UNIVERSAL LIFE
-----------------------------------------------------------------------------------------------
INTERMEDIATE LONG TERM GOVERNMENT MONEY
TERM BOND BOND SECURITIES MARKET EQUITY SMALL CAP MANAGED
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------ ---------- ---------- ------------ ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Dividend income.................. $ 6,095 $ 42,293 $ 14,009 $ 135,531 $ 544,698 $ 694,933 $ 2,719,101
Mortality and expense risk
charges (Note 3)............... (1,008) (5,751) (2,949) (19,730) (77,153) (34,486) (318,312)
-------- --------- --------- ------------ ----------- ----------- -----------
Net investment income............ 5,087 36,542 11,060 115,801 467,545 660,447 2,400,789
-------- --------- --------- ------------ ----------- ----------- -----------
Realized and unrealized gain on
investments (Note 2):
Proceeds from sales............ 52,711 292,029 143,307 24,713,256 3,327,872 1,503,358 11,923,853
Cost of shares sold............ (51,442) (285,745) (138,374) (24,713,256) (2,581,752) (1,160,613) (9,087,421)
-------- --------- --------- ------------ ----------- ----------- -----------
Net realized gain on
investments.................... 1,269 6,284 4,933 0 746,120 342,745 2,836,432
Net increase (decrease) in
unrealized appreciation of
investments.................... 3,027 56,115 9,241 0 984,236 568,217 3,108,829
-------- --------- --------- ------------ ----------- ----------- -----------
Net realized and unrealized gain
(loss) on investments.......... 4,296 62,399 14,174 0 1,730,356 910,962 5,945,261
-------- --------- --------- ------------ ----------- ----------- -----------
Net increase in net assets
resulting from operations...... $ 9,383 $ 98,941 $ 25,234 $ 115,801 $ 2,197,901 $ 1,571,409 $ 8,346,050
======== ========= ========= ============ =========== =========== ===========
<CAPTION>
VARIABLE UNIVERSAL LIFE
--------------------------
INTERNATIONAL HIGH YIELD
GROWTH BOND
SUBACCOUNT SUBACCOUNT
------------- ----------
<S> <C> <C>
Dividend income.................. $ 120,361 $ 121,077
Mortality and expense risk
charges (Note 3)............... (21,528) (9,887)
---------- ---------
Net investment income............ 98,833 111,190
---------- ---------
Realized and unrealized gain on
investments (Note 2):
Proceeds from sales............ 1,007,459 636,523
Cost of shares sold............ (871,948) (600,592)
---------- ---------
Net realized gain on
investments.................... 135,511 35,931
Net increase (decrease) in
unrealized appreciation of
investments.................... (204,105) 12,532
---------- ---------
Net realized and unrealized gain
(loss) on investments.......... (68,594) 48,463
---------- ---------
Net increase in net assets
resulting from operations...... $ 30,239 $ 159,653
========== =========
</TABLE>
See notes to financial statements.
F-6
<PAGE> 58
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEARS ENDED DECEMBER 31,
<TABLE>
<CAPTION>
VARIABLE LIFE
--------------------------------------------------------------------------------------
EQUITY GROWTH EQUITY INCOME INTERMEDIATE TERM LONG TERM
SUBACCOUNT SUBACCOUNT BOND SUBACCOUNT BOND SUBACCOUNT
------------------- -------------------- ------------------- -------------------
1997 1996 1997 1996 1997 1996 1997 1996
-------- -------- --------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
From operations:
Net investment income (loss)........... $ 53,040 $ (3,666) $ 76,627 $ (2,649) $ 9,374 $ (1,063) $ 5,147 $ (582)
Net realized gain on investments....... 33,607 22,971 84,704 35,481 1,672 665 3,780 1,989
Net increase (decrease) in unrealized
appreciation of investments.......... 101,936 92,373 32,332 80,163 288 5,698 649 (2,681)
-------- -------- --------- -------- -------- -------- -------- --------
Net increase (decrease) in net assets
resulting from operations.............. 188,583 111,678 193,663 112,995 11,334 5,300 9,576 (1,274)
-------- -------- --------- -------- -------- -------- -------- --------
From unit transactions:
Net proceeds from the issuance of
units................................ 35,646 46,370 39,172 38,780 8,194 12,039 4,547 5,926
Net asset value of units redeemed or
used to meet contract obligations.... (59,621) (75,563) (193,625) (90,508) (40,032) (23,076) (37,821) (15,517)
-------- -------- --------- -------- -------- -------- -------- --------
Net decrease from unit transactions...... (23,975) (29,193) (154,453) (51,728) (31,838) (11,037) (33,274) (9,591)
-------- -------- --------- -------- -------- -------- -------- --------
Net increase (decrease) in net assets.... 164,608 82,485 39,210 61,267 (20,504) (5,737) (23,698) (10,865)
Net assets beginning of year............. 633,526 551,041 666,450 605,183 177,041 182,778 95,253 106,118
-------- -------- --------- -------- -------- -------- -------- --------
Net assets end of year*.................. $798,134 $633,526 $ 705,660 $666,450 $156,537 $177,041 $ 71,555 $ 95,253
======== ======== ========= ======== ======== ======== ======== ========
Units outstanding beginning of year...... 14,958 15,643 15,149 16,377 8,041 8,556 3,504 3,869
Units issued during the year............. 747 1,232 783 1,004 362 562 165 226
Units redeemed during the year........... (1,199) (1,917) (3,640) (2,232) (1,764) (1,077) (1,335) (591)
-------- -------- --------- -------- -------- -------- -------- --------
Units outstanding end of year............ 14,506 14,958 12,292 15,149 6,639 8,041 2,334 3,504
======== ======== ========= ======== ======== ======== ======== ========
- ---------------
* Includes undistributed net investment
income of: $168,021 $114,981 $ 327,758 $251,131 $163,834 $154,460 $100,095 $ 94,948
<CAPTION>
VARIABLE LIFE
---------------------------------------------
DIVERSIFIED MONEY MARKET
SUBACCOUNT SUBACCOUNT
----------------------- -------------------
1997 1996 1997 1996
---------- ---------- -------- --------
<S> <C> <C> <C> <C>
From operations:
Net investment income (loss)........... $ 77,745 $ (6,210) $ 3,689 $ 3,835
Net realized gain on investments....... 100,092 29,580 0 0
Net increase (decrease) in unrealized
appreciation of investments.......... 59,772 110,202 0 0
---------- ---------- -------- --------
Net increase (decrease) in net assets
resulting from operations.............. 237,609 133,572 3,689 3,835
---------- ---------- -------- --------
From unit transactions:
Net proceeds from the issuance of
units................................ 77,730 85,626 6,471 9,558
Net asset value of units redeemed or
used to meet contract obligations.... (287,917) (124,946) (19,886) (18,398)
---------- ---------- -------- --------
Net decrease from unit transactions...... (210,187) (39,320) (13,415) (8,840)
---------- ---------- -------- --------
Net increase (decrease) in net assets.... 27,422 94,252 (9,726) (5,005)
Net assets beginning of year............. 1,083,741 989,489 85,289 90,294
---------- ---------- -------- --------
Net assets end of year*.................. $1,111,163 $1,083,741 $ 75,563 $ 85,289
========== ========== ======== ========
Units outstanding beginning of year...... 34,279 35,607 4,970 5,499
Units issued during the year............. 2,219 2,942 368 570
Units redeemed during the year........... (8,207) (4,270) (1,131) (1,099)
---------- ---------- -------- --------
Units outstanding end of year............ 28,291 34,279 4,207 4,970
========== ========== ======== ========
- ---------------
* Includes undistributed net investment
income of: $ 533,506 $ 455,761 $ 77,176 $ 73,487
</TABLE>
See notes to financial statements.
F-7
<PAGE> 59
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
FOR THE YEARS ENDED DECEMBER 31,
<TABLE>
<CAPTION>
VARIABLE UNIVERSAL LIFE
-----------------------------------------------------------------------------------------------
INTERMEDIATE TERM LONG TERM GOVERNMENT MONEY
BOND BOND SECURITIES MARKET
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------------- -------------------- -------------------- ---------------------------
1997 1996 1997 1996 1997 1996 1997 1996
-------- -------- --------- -------- --------- -------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
From operations:
Net investment income
(loss)...................... $ 5,087 $ (404) $ 36,542 $ (3,193) $ 11,060 $ (1,630) $ 115,801 $ 86,414
Net realized gain (loss) on
investments................. 1,269 (715) 6,284 795 4,933 906 0 0
Net increase in unrealized
appreciation of
investments................. 3,027 3,148 56,115 13,609 9,241 7,805 0 0
-------- -------- --------- -------- --------- -------- ------------ ------------
Net increase in net assets
resulting from operations..... 9,383 2,029 98,941 11,211 25,234 7,081 115,801 86,414
-------- -------- --------- -------- --------- -------- ------------ ------------
From unit transactions:
Net proceeds from the issuance
of units.................... 172,340 82,991 471,749 425,430 288,293 149,977 20,219,389 15,675,163
Net asset value of units
redeemed or used to meet
contract obligations........ (38,182) (20,916) (236,759) (91,922) (107,779) (35,779) (20,985,756) (13,113,154)
-------- -------- --------- -------- --------- -------- ------------ ------------
Net increase (decrease) from
unit transactions............. 134,158 62,075 234,990 333,508 180,514 114,198 (766,367) 2,562,009
-------- -------- --------- -------- --------- -------- ------------ ------------
Net increase (decrease) in net
assets........................ 143,541 64,104 333,931 344,719 205,748 121,279 (650,566) 2,648,423
Net assets beginning of year.... 90,824 26,720 614,531 269,812 292,657 171,378 4,349,240 1,700,817
-------- -------- --------- -------- --------- -------- ------------ ------------
Net assets end of year*......... $234,365 $ 90,824 $ 948,462 $614,531 $ 498,405 $292,657 $ 3,698,674 $ 4,349,240
======== ======== ========= ======== ========= ======== ============ ============
Units outstanding beginning of
year.......................... 8,138 2,464 50,910 22,127 26,498 15,959 400,565 163,465
Units issued during the year.... 14,831 7,592 37,613 36,743 25,322 13,851 1,818,649 1,469,700
Units redeemed during the
year.......................... (3,319) (1,918) (18,744) (7,960) (9,400) (3,312) (1,893,235) (1,232,600)
-------- -------- --------- -------- --------- -------- ------------ ------------
Units outstanding end of year... 19,650 8,138 69,779 50,910 42,420 26,498 325,979 400,565
======== ======== ========= ======== ========= ======== ============ ============
- ---------------
* Includes undistributed net
investment income of: $ 6,097 $ 1,010 $ 47,307 $ 10,765 $ 14,524 $ 3,464 $ 222,591 $ 106,790
</TABLE>
See notes to financial statements.
F-8
<PAGE> 60
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
FOR THE YEARS ENDED DECEMBER 31,
<TABLE>
<CAPTION>
VARIABLE UNIVERSAL LIFE (CONTINUED)
-------------------------------------------------------------------------------
EQUITY SMALL CAP MANAGED
SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------------------ ------------------------ -------------------------
1997 1996 1997 1996 1997 1996
----------- ---------- ----------- ---------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
From operations:
Net investment income (loss)....... $ 467,545 $ 46,194 $ 660,447 $ 28,953 $ 2,400,789 $ 134,759
Net realized gain on investments... 746,120 174,857 342,745 30,574 2,836,432 783,666
Net increase (decrease) in
unrealized appreciation of
investments...................... 984,236 357,881 568,217 78,392 3,108,829 2,166,435
----------- ---------- ----------- ---------- ----------- -----------
Net increase in net assets resulting
from operations.................... 2,197,901 578,932 1,571,409 137,919 8,346,050 3,084,860
----------- ---------- ----------- ---------- ----------- -----------
From unit transactions:
Net proceeds from the issuance
of units......................... 11,812,002 4,459,200 5,248,401 2,152,749 36,238,986 20,620,582
Net asset value of units redeemed
or used to meet contract
obligations...................... (2,656,849) (952,864) (1,072,152) (454,428) (9,726,108) (4,735,332)
----------- ---------- ----------- ---------- ----------- -----------
Net increase from unit
transactions....................... 9,155,153 3,506,336 4,176,249 1,698,321 26,512,878 15,885,250
----------- ---------- ----------- ---------- ----------- -----------
Net increase in net assets........... 11,353,054 4,085,268 5,747,658 1,836,240 34,858,928 18,970,110
Net assets beginning of year......... 5,129,744 1,044,476 2,437,067 600,827 25,210,073 6,239,963
----------- ---------- ----------- ---------- ----------- -----------
Net assets end of year*.............. $16,482,798 $5,129,744 $ 8,184,725 $2,437,067 $60,069,001 $25,210,073
=========== ========== =========== ========== =========== ===========
Units outstanding beginning of
year............................... 319,002 80,766 191,743 52,194 1,532,486 465,095
Units issued during the year......... 647,931 303,412 326,703 176,984 1,945,611 1,382,408
Units redeemed during the year....... (145,843) (65,176) (69,043) (37,435) (523,427) (315,017)
----------- ---------- ----------- ---------- ----------- -----------
Units outstanding end of year........ 821,090 319,002 449,403 191,743 2,954,670 1,532,486
=========== ========== =========== ========== =========== ===========
- ---------------
* Includes undistributed net
investment income of: $ 538,907 $ 71,362 $ 705,833 $ 45,386 $ 2,719,621 $ 318,832
<CAPTION>
VARIABLE UNIVERSAL LIFE (CONTINUED)
------------------------------------------------
INTERNATIONAL HIGH YIELD
GROWTH BOND
SUBACCOUNT SUBACCOUNT
----------------------- ----------------------
1997 1996 1997 1996
---------- ---------- ---------- ---------
<S> <C> <C> <C> <C>
From operations:
Net investment income (loss)....... $ 98,833 $ (1,058) $ 111,190 $ 42,346
Net realized gain on investments... 135,511 23,372 35,931 180
Net increase (decrease) in
unrealized appreciation of
investments...................... (204,105) 96,691 12,532 25,863
---------- ---------- ---------- ---------
Net increase in net assets resulting
from operations.................... 30,239 119,005 159,653 68,389
---------- ---------- ---------- ---------
From unit transactions:
Net proceeds from the issuance
of units......................... 3,034,936 1,524,746 1,268,282 535,643
Net asset value of units redeemed
or used to meet contract
obligations...................... (717,365) (291,724) (319,664) (125,293)
---------- ---------- ---------- ---------
Net increase from unit
transactions....................... 2,317,571 1,233,022 948,618 410,350
---------- ---------- ---------- ---------
Net increase in net assets........... 2,347,810 1,352,027 1,108,271 478,739
Net assets beginning of year......... 1,731,444 379,417 831,448 352,709
---------- ---------- ---------- ---------
Net assets end of year*.............. $4,079,254 $1,731,444 $1,939,719 $ 831,448
========== ========== ========== =========
Units outstanding beginning of
year............................... 128,820 31,566 66,709 31,730
Units issued during the year......... 211,751 120,205 95,695 45,756
Units redeemed during the year....... (50,105) (22,951) (24,129) (10,777)
---------- ---------- ---------- ---------
Units outstanding end of year........ 290,466 128,820 138,275 66,709
========== ========== ========== =========
- ---------------
* Includes undistributed net
investment income of: $ 115,713 $ 16,880 $ 160,937 $ 49,747
</TABLE>
See notes to financial statements.
F-9
<PAGE> 61
MONY AMERICA
VARIABLE ACCOUNT L
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION AND BUSINESS
MONY America Variable Account L (the "Variable Account") is a separate
investment account established on February 19, 1985 by MONY Life Insurance
Company of America ("MONY America"), under the laws of the State of Arizona.
The Variable Account operates as a unit investment trust under the
Investment Company Act of 1940 (the "1940 Act"). The Variable Account holds
assets that are segregated from all of MONY America's other assets and, at
present, is used to support Flexible Premium Variable Life Insurance policies,
which include Variable Life Insurance (Strategist), Variable Universal Life
(MONYEquity Master) and Corporate Sponsored Variable Life Insurance policies.
These policies are issued by MONY America, which is a wholly-owned subsidiary of
The Mutual Life Insurance Company of New York ("MONY"). For presentation
purposes, the information related to the Variable Life and Variable Universal
Life Insurance policies are presented here.
There are currently six Variable Life Subaccounts and nine Variable
Universal Life Subaccounts within the Variable Account, each invests only in a
corresponding portfolio of the MONY Series Fund, Inc. (the "Fund") or the
Enterprise Accumulation Trust ("Enterprise") (collectively, the "Funds"). The
subaccounts of the Variable Universal Life commenced operations during 1995. The
Funds are registered under the 1940 Act as open end, diversified, management
investment companies.
A full presentation of the related financial statements and footnotes of
the Fund and Enterprise are contained on pages 68 to 102 and 105 to 142,
respectively, and should be read in conjunction with these financial statements.
2. SIGNIFICANT ACCOUNTING POLICIES
Investment:
The investment in shares of each of the respective portfolios is stated at
value which is the net asset values of the Funds. Except for the Money Market
Portfolios, net asset values are based upon market quotations of the securities
held in each of the corresponding portfolios of the Funds. For the Money Market
Portfolios, the net asset values are based on amortized cost of the securities
held which approximates value.
Taxes:
MONY America is currently taxed as a life insurance company and will
include the Variable Account's operations in its tax return. MONY America does
not expect, based on current tax law, to incur any income tax burden upon the
earnings or realized capital gains attributable to the Variable Account. Based
on this expectation, no charges are currently being deducted from the Variable
Account for federal income tax purposes.
3. RELATED PARTY TRANSACTIONS
MONY America is the legal owner of the assets held by the Variable Account.
Policy premiums received from MONY America by the Variable Account
represent gross policy premiums recorded by MONY America less deductions
retained as compensation for certain sales distribution expenses and premium
taxes.
The cost of insurance, administration charges, and, if applicable, the cost
of any optional benefits added by riders are deducted on each monthly date from
the cash value of the contract to compensate MONY America. These deductions are
treated as contractholder redemptions by the Variable Account. The amount
deducted for the Variable Life and Variable Universal Subaccounts for 1997
aggregated $10,793,622.
MONY America receives from the Variable Account the amounts deducted for
mortality and expense risks at an annual rate of .60 percent (for the Variable
Life Subaccounts) and .75 percent (for the Variable
F-10
<PAGE> 62
MONY AMERICA
VARIABLE ACCOUNT L
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
3. RELATED PARTY TRANSACTIONS (CONTINUED)
Universal Life Subaccounts) of aggregate average daily net assets. As investment
adviser to the Fund, it receives amounts paid by the Fund for those services.
Enterprise Capital Management, Inc., a wholly-owned subsidiary of MONY,
acts as investment adviser to Enterprise, and it receives amounts paid by
Enterprise for those services.
4. INVESTMENTS
Investments in Variable Life at cost, at December 31, 1997 consist of the
following:
<TABLE>
<CAPTION>
MONY SERIES FUND, INC.
--------------------------------------------------------------------------
EQUITY EQUITY INTERMEDIATE LONG TERM MONEY
GROWTH INCOME TERM BOND BOND DIVERSIFIED MARKET
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- --------- ------------ --------- ----------- ---------
<S> <C> <C> <C> <C> <C> <C>
Shares beginning of year:
Shares....................... 20,860 28,432 16,153 7,418 60,241 85,289
Amount....................... $483,575 $ 480,537 $168,956 $ 87,403 $ 838,945 $ 85,289
-------- --------- -------- -------- --------- --------
Shares acquired:
Shares....................... 1,812 1,865 2,121 395 4,933 18,415
Amount....................... $ 59,559 $ 47,176 $ 22,875 $ 5,012 $ 94,559 $ 18,415
Shares received for
reinvestment of dividends:
Shares....................... 2,038 3,766 1,007 483 5,055 4,176
Amount....................... $ 57,504 $ 80,960 $ 10,378 $ 5,654 $ 84,416 $ 4,176
Shares redeemed:
Shares....................... (2,589) (8,024) (5,204) (3,051) (16,315) (32,317)
Amount....................... $(54,391) $(121,259) $(54,045) $(35,014) $(211,325) $(32,317)
-------- --------- -------- -------- --------- --------
Net change:
Shares....................... 1,261 (2,393) (2,076) (2,173) (6,327) (9,726)
Amount....................... $ 62,672 $ 6,877 $(20,792) $(24,348) $ (32,350) $ (9,726)
-------- --------- -------- -------- --------- --------
Shares end of year:
Shares....................... 22,121 26,039 14,077 5,245 53,914 75,563
Amount....................... $546,247 $ 487,414 $148,164 $ 63,055 $ 806,595 $ 75,563
======== ========= ======== ======== ========= ========
</TABLE>
F-11
<PAGE> 63
MONY AMERICA
VARIABLE ACCOUNT L
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
4. INVESTMENTS (CONTINUED)
Investments in Variable Universal Life at cost, at December 31, 1997
consist of the following:
<TABLE>
<CAPTION>
MONY SERIES FUND, INC.
----------------------------------------------------
INTERMEDIATE LONG TERM GOVERNMENT MONEY
TERM BOND BOND SECURITIES MARKET
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
------------ --------- ---------- ------------
<S> <C> <C> <C> <C>
Shares beginning of
year:
Shares............. 8,287 47,861 27,661 4,349,240
Amount............. $ 88,592 $ 592,645 $ 285,560 $ 4,349,240
-------- --------- --------- ------------
Shares acquired:
Shares............. 17,072 40,961 30,184 23,927,159
Amount............. $185,860 $ 521,268 $ 320,872 $ 23,927,159
Shares received for
reinvestment of
dividends:
Shares............. 591 3,615 1,373 135,531
Amount............. $ 6,095 $ 42,293 $ 14,009 $ 135,531
Shares redeemed:
Shares............. (4,874) (22,902) (13,451) (24,713,256)
Amount............. $(51,442) $(285,745) $(138,374) $(24,713,256)
-------- --------- --------- ------------
Net change:
Shares............. 12,789 21,674 18,106 (650,566)
Amount............. $140,513 $ 277,816 $ 196,507 $ (650,566)
-------- --------- --------- ------------
Shares end of year:
Shares............. 21,076 69,535 45,767 3,698,674
Amount............. $229,105 $ 870,461 $ 482,067 $ 3,698,674
======== ========= ========= ============
<CAPTION>
ENTERPRISE ACCUMULATION TRUST
--------------------------------------------------------------------
HIGH
INTERNATIONAL YIELD
EQUITY SMALL CAP MANAGED GROWTH BOND
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------- ----------- ----------- ------------- ----------
<S> <C> <C> <C> <C> <C>
Shares beginning of
year:
Shares............. 177,746 120,528 734,773 286,189 150,898
Amount............. $ 4,748,651 $ 2,362,738 $22,951,520 $1,634,862 $ 805,224
----------- ----------- ----------- ---------- ----------
Shares acquired:
Shares............. 377,731 219,786 977,516 509,835 284,392
Amount............. $12,405,871 $ 5,645,121 $38,118,419 $3,303,502 $1,575,254
Shares received for
reinvestment of
dividends:
Shares............. 15,523 26,027 66,677 19,476 17,799
Amount............. $ 544,698 $ 694,933 $ 2,719,101 $ 120,361 $ 121,077
Shares redeemed:
Shares............. (101,270) (59,797) (305,965) (155,426) (113,383)
Amount............. $(2,581,752) $(1,160,613) $(9,087,421) $ (871,948) $ (600,592)
----------- ----------- ----------- ---------- ----------
Net change:
Shares............. 291,984 186,016 738,228 373,885 188,808
Amount............. $10,368,817 $ 5,179,441 $31,750,099 $2,551,915 $1,095,739
----------- ----------- ----------- ---------- ----------
Shares end of year:
Shares............. 469,730 306,544 1,473,001 660,074 339,706
Amount............. $15,117,468 $ 7,542,179 $54,701,619 $4,186,777 $1,900,963
=========== =========== =========== ========== ==========
</TABLE>
F-12
<PAGE> 64
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors of
MONY Life Insurance Company of America and the
Contractholders of MONY America Variable Account L:
We have audited the accompanying statements of assets and liabilities of
MONY America Variable Account L (comprising, respectively, the Variable Life's
Equity Growth, Equity Income, Intermediate Term Bond, Long Term Bond,
Diversified and Money Market Subaccounts and the Variable Universal Life's
Intermediate Term Bond, Long Term Bond, Government Securities, Money Market,
Equity, Small Cap, Managed, International Growth and High Yield Bond
Subaccounts) as of December 31, 1996, for the Variable Life's Subaccounts, the
related statements of operations for the year then ended and the statements of
changes in net assets for each of the two years in the period then ended, and
for the Variable Universal Life's Subaccounts, the related statements of
operations for the year then ended and the statements of changes in net assets
for the year ended December 31, 1996 and for the Intermediate Term Bond
Subaccount for which the period is from April 20, 1995 (commencement of
operations) to December 31, 1995, the Long Term Bond Subaccount for which the
period is from March 31, 1995 (commencement of operations) to December 31, 1995,
the Government Securities and High Yield Bond Subaccounts for which the period
is from March 20, 1995 (commencement of operations) to December 31, 1995, the
Money Market Subaccount for which the period is from February 17, 1995
(commencement of operations) to December 31, 1995, the Equity, Managed and
International Growth Subaccounts for which the period is from March 8, 1995
(commencement of operations) to December 31, 1995, and the Small Cap Subaccount
for which the period is from March 9, 1995 (commencement of operations) to
December 31, 1995. These financial statements are the responsibility of MONY
America's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. Our procedures included
confirmation of securities owned as of December 31, 1996, by correspondence with
the custodian. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of each of the respective
subaccounts constituting MONY America Variable Account L as of December 31,
1996, the results of their operations for the year then ended, and the changes
in their net assets for each of the periods referred to above, in conformity
with generally accepted accounting principles.
COOPERS & LYBRAND L.L.P.
New York, New York
February 14, 1997
F-13
<PAGE> 65
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF ASSETS AND LIABILITIES
DECEMBER 31, 1996
<TABLE>
<CAPTION>
VARIABLE LIFE
------------------------------------------------------------------------------
EQUITY EQUITY INTERMEDIATE LONG TERM MONEY
GROWTH INCOME TERM BOND BOND DIVERSIFIED MARKET
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------- ---------- ------------ ---------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Investments at cost (Note 4)..... $ 483,575 $ 480,536 $ 168,956 $ 87,402 $ 838,945 $ 85,289
========= ========= ========= ========= ========== =========
Investments in MONY Series Fund,
Inc. at net asset value (Note
2)............................. $ 633,526 $ 666,450 $ 177,041 $ 95,253 $1,083,741 $ 85,289
Amount due from MONY America..... 5 5 0 0 0 0
Amount due from MONY Series Fund,
Inc. .......................... 9 9 0 0 26 0
--------- --------- --------- --------- ---------- ---------
Total assets........... 633,540 666,464 177,041 95,253 1,083,767 85,289
--------- --------- --------- --------- ---------- ---------
LIABILITIES
Amount due to MONY America....... 9 9 0 0 26 0
Amount due to MONY Series Fund,
Inc. .......................... 5 5 0 0 0 0
--------- --------- --------- --------- ---------- ---------
Total liabilities...... 14 14 0 0 26 0
--------- --------- --------- --------- ---------- ---------
Net assets....................... $ 633,526 $ 666,450 $ 177,041 $ 95,253 $1,083,741 $ 85,289
========= ========= ========= ========= ========== =========
Net assets consist of:
Contractholders' net
payments.................. $ 530,611 $ 564,123 $ 211,304 $ 127,727 $1,079,623 $ 198,280
Cost of insurance
withdrawals (Note 3)...... (352,711) (451,201) (189,141) (142,302) (852,538) (186,478)
Undistributed net investment
income.................... 114,981 251,131 154,460 94,948 455,761 73,487
Accumulated net realized
gain (loss) on
investments............... 190,694 116,483 (7,667) 7,029 156,099 0
Unrealized appreciation of
investments............... 149,951 185,914 8,085 7,851 244,796 0
--------- --------- --------- --------- ---------- ---------
Net assets....................... $ 633,526 $ 666,450 $ 177,041 $ 95,253 $1,083,741 $ 85,289
========= ========= ========= ========= ========== =========
Number of units outstanding*..... 14,958 15,149 8,041 3,504 34,279 4,970
--------- --------- --------- --------- ---------- ---------
Net asset value per unit
outstanding*................... $ 42.35 $ 43.99 $ 22.02 $ 27.18 $ 31.62 $ 17.16
========= ========= ========= ========= ========== =========
</TABLE>
- ---------------
* Units outstanding have been rounded for presentation purposes.
See notes to financial statements.
F-14
<PAGE> 66
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF ASSETS AND LIABILITIES (CONTINUED)
DECEMBER 31, 1996
<TABLE>
<CAPTION>
VARIABLE UNIVERSAL LIFE
-------------------------------------------------------------------------------------------
INTERMEDIATE LONG TERM GOVERNMENT MONEY
TERM BOND BOND SECURITIES MARKET EQUITY SMALL CAP MANAGED
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------ ---------- ---------- ---------- ---------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Investments at cost (Note 4)....... $ 88,591 $592,645 $285,560 $4,349,240 $4,748,650 $2,362,738 $22,951,520
======== ======== ======== ========== ========== ========== ===========
Investments in Enterprise
Accumulation Trust at net asset
value (Note 2)................... $ 0 $ 0 $ 0 $ 0 $5,129,744 $2,437,067 $25,210,073
Investments in MONY Series Fund,
Inc. at net asset value (Note
2)............................... 90,824 614,531 292,657 4,349,240 0 0 0
Amount due from Enterprise
Accumulation Trust............... 0 0 0 0 1,772 1,113 5,270
Amount due from MONY America....... 33 123 85 8,194 2,031 583 30,697
Amount due from MONY Series Fund,
Inc.............................. 10 0 26 113,916 0 0 0
-------- -------- -------- ---------- ---------- ---------- -----------
Total assets............... 90,867 614,654 292,768 4,471,350 5,133,547 2,438,763 25,246,040
-------- -------- -------- ---------- ---------- ---------- -----------
LIABILITIES
Amount due to Enterprise
Accumulation Trust............... 0 0 0 0 2,031 583 30,697
Amount due to MONY America......... 10 0 26 113,916 1,772 1,113 5,270
Amount due to MONY Series Fund,
Inc.............................. 33 123 85 8,194 0 0 0
-------- -------- -------- ---------- ---------- ---------- -----------
Total liabilities.......... 43 123 111 122,110 3,803 1,696 35,967
-------- -------- -------- ---------- ---------- ---------- -----------
Net assets......................... $ 90,824 $614,531 $292,657 $4,349,240 $5,129,744 $2,437,067 $25,210,073
======== ======== ======== ========== ========== ========== ===========
Net assets consist of:
Contractholders' net
payments..................... $106,061 $656,214 $317,161 $4,461,789 $5,366,348 $2,733,551 $25,623,125
Cost of insurance withdrawals
(Note 3)..................... (18,139) (76,295) (36,104) (219,339) (887,308) (456,533) (3,897,375)
Undistributed net investment
income....................... 1,010 10,765 3,464 106,790 71,362 45,386 318,832
Accumulated net realized gain
(loss) on investments........ (341) 1,961 1,039 0 198,248 40,334 906,938
Unrealized appreciation of
investments.................. 2,233 21,886 7,097 0 381,094 74,329 2,258,553
-------- -------- -------- ---------- ---------- ---------- -----------
Net assets......................... $ 90,824 $614,531 $292,657 $4,349,240 $5,129,744 $2,437,067 $25,210,073
======== ======== ======== ========== ========== ========== ===========
Number of units outstanding*....... 8,138 50,910 26,498 400,565 319,002 191,743 1,532,486
-------- -------- -------- ---------- ---------- ---------- -----------
Net asset value per unit
outstanding*..................... $ 11.16 $ 12.07 $ 11.04 $ 10.86 $ 16.08 $ 12.71 $ 16.45
======== ======== ======== ========== ========== ========== ===========
<CAPTION>
VARIABLE UNIVERSAL LIFE
--------------------------
INTERNATIONAL HIGH YIELD
GROWTH BOND
SUBACCOUNT SUBACCOUNT
------------- ----------
<S> <C> <C>
ASSETS
Investments at cost (Note 4)....... $1,634,862 $ 805,224
========== =========
Investments in Enterprise
Accumulation Trust at net asset
value (Note 2)................... $1,731,444 $ 831,448
Investments in MONY Series Fund,
Inc. at net asset value (Note
2)............................... 0 0
Amount due from Enterprise
Accumulation Trust............... 338 154
Amount due from MONY America....... 323 113
Amount due from MONY Series Fund,
Inc.............................. 0 0
---------- ---------
Total assets............... 1,732,105 831,715
---------- ---------
LIABILITIES
Amount due to Enterprise
Accumulation Trust............... 323 113
Amount due to MONY America......... 338 154
Amount due to MONY Series Fund,
Inc.............................. 0 0
---------- ---------
Total liabilities.......... 661 267
---------- ---------
Net assets......................... $1,731,444 $ 831,448
========== =========
Net assets consist of:
Contractholders' net
payments..................... $1,864,972 $ 885,885
Cost of insurance withdrawals
(Note 3)..................... (276,528) (130,778)
Undistributed net investment
income....................... 16,880 49,747
Accumulated net realized gain
(loss) on investments........ 29,538 370
Unrealized appreciation of
investments.................. 96,582 26,224
---------- ---------
Net assets......................... $1,731,444 $ 831,448
========== =========
Number of units outstanding*....... 128,820 66,709
---------- ---------
Net asset value per unit
outstanding*..................... $ 13.44 $ 12.46
========== =========
</TABLE>
- ---------------
* Units outstanding have been rounded for presentation purposes.
See notes to financial statements.
F-15
<PAGE> 67
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1996
<TABLE>
<CAPTION>
VARIABLE LIFE
------------------------------------------------------------------------------
EQUITY EQUITY INTERMEDIATE LONG TERM MONEY
GROWTH INCOME TERM BOND BOND DIVERSIFIED MARKET
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------- ---------- ------------ ---------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Dividend income..................... $ 0 $ 1,204 $ 0 $ 0 $ 0 $ 4,359
Mortality and expense risk charges
(Note 3).......................... 3,666 3,853 1,063 582 6,210 524
-------- -------- ------- ------- -------- -------
Net investment income (loss)........ (3,666) (2,649) (1,063) (582) (6,210) 3,835
-------- -------- ------- ------- -------- -------
Realized and unrealized gain on
investments (Note 2):
Proceeds from sales............... 93,619 102,327 28,266 17,665 140,885 22,914
Cost of shares sold............... 70,648 66,846 27,601 15,676 111,305 22,914
-------- -------- ------- ------- -------- -------
Net realized gain on investments.... 22,971 35,481 665 1,989 29,580 0
Net increase (decrease) in
unrealized appreciation of
investments....................... 92,373 80,163 5,698 (2,681) 110,202 0
-------- -------- ------- ------- -------- -------
Net realized and unrealized gain
(loss) on investments............. 115,344 115,644 6,363 (692) 139,782 0
-------- -------- ------- ------- -------- -------
Net increase (decrease) in net
assets resulting from
operations........................ $111,678 $112,995 $ 5,300 $(1,274) $133,572 $ 3,835
======== ======== ======= ======= ======== =======
</TABLE>
See notes to financial statements.
F-16
<PAGE> 68
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF OPERATIONS (CONTINUED)
FOR THE YEAR ENDED DECEMBER 31, 1996
<TABLE>
<CAPTION>
VARIABLE UNIVERSAL LIFE
-------------------------------------------------------------------------------------------
INTERMEDIATE LONG TERM GOVERNMENT MONEY
TERM BOND BOND SECURITIES MARKET EQUITY SMALL CAP MANAGED
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------ ---------- ---------- ----------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Dividend income............... $ 0 $ 0 $ 0 $ 101,677 $ 66,222 $ 39,244 $ 243,882
Mortality and expense risk
charges (Note 3)............ 404 3,193 1,630 15,263 20,028 10,291 109,123
------- -------- ------- ----------- ---------- -------- ----------
Net investment income
(loss)...................... (404) (3,193) (1,630) 86,414 46,194 28,953 134,759
------- -------- ------- ----------- ---------- -------- ----------
Realized and unrealized gain
(loss) on investments (Note
2):
Proceeds from sales......... 38,393 159,811 53,965 15,827,331 1,265,465 634,803 6,072,015
Cost of shares sold......... 39,108 159,016 53,059 15,827,331 1,090,608 604,229 5,288,349
------- -------- ------- ----------- ---------- -------- ----------
Net realized gain (loss) on
investments................. (715) 795 906 0 174,857 30,574 783,666
Net increase in unrealized
appreciation of
investments................. 3,148 13,609 7,805 0 357,881 78,392 2,166,435
------- -------- ------- ----------- ---------- -------- ----------
Net realized and unrealized
gain on investments......... 2,433 14,404 8,711 0 532,738 108,966 2,950,101
------- -------- ------- ----------- ---------- -------- ----------
Net increase in net assets
resulting from operations... $ 2,029 $ 11,211 $ 7,081 $ 86,414 $ 578,932 $137,919 $3,084,860
======= ======== ======= =========== ========== ======== ==========
<CAPTION>
VARIABLE UNIVERSAL LIFE
--------------------------
INTERNATIONAL HIGH YIELD
GROWTH BOND
SUBACCOUNT SUBACCOUNT
------------- ----------
<S> <C> <C>
Dividend income............... $ 6,221 $ 46,366
Mortality and expense risk
charges (Note 3)............ 7,279 4,020
-------- --------
Net investment income
(loss)...................... (1,058) 42,346
-------- --------
Realized and unrealized gain
(loss) on investments (Note
2):
Proceeds from sales......... 432,562 387,912
Cost of shares sold......... 409,190 387,732
-------- --------
Net realized gain (loss) on
investments................. 23,372 180
Net increase in unrealized
appreciation of
investments................. 96,691 25,863
-------- --------
Net realized and unrealized
gain on investments......... 120,063 26,043
-------- --------
Net increase in net assets
resulting from operations... $119,005 $ 68,389
======== ========
</TABLE>
See notes to financial statements.
F-17
<PAGE> 69
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEARS ENDED DECEMBER 31,
<TABLE>
<CAPTION>
VARIABLE LIFE
-------------------------------------------------------------------------------------
EQUITY GROWTH EQUITY INCOME INTERMEDIATE TERM LONG TERM
SUBACCOUNT SUBACCOUNT BOND SUBACCOUNT BOND SUBACCOUNT
------------------- ------------------- ------------------- -------------------
1996 1995 1996 1995 1996 1995 1996 1995
-------- -------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
From operations:
Net investment income (loss)...... $ (3,666) $ 33,459 $ (2,649) $ 27,822 $ (1,063) $ 9,165 $ (582) $ 5,101
Net realized gain on
investments..................... 22,971 30,308 35,481 39,090 665 2,059 1,989 5,208
Net increase (decrease) in
unrealized appreciation of
investments..................... 92,373 57,362 80,163 88,922 5,698 11,732 (2,681) 16,634
-------- -------- -------- -------- -------- -------- -------- --------
Net increase (decrease) in net
assets resulting from operations.. 111,678 121,129 112,995 155,834 5,300 22,956 (1,274) 26,943
-------- -------- -------- -------- -------- -------- -------- --------
From unit transactions:
Net proceeds from the issuance of
units........................... 46,370 246,538 38,780 56,024 12,039 13,113 5,926 7,195
Net asset value of units redeemed
or used to meet contract
obligations..................... (75,563) (164,237) (90,508) (132,231) (23,076) (23,804) (15,517) (29,360)
-------- -------- -------- -------- -------- -------- -------- --------
Net increase (decrease) from unit
transactions...................... (29,193) 82,301 (51,728) (76,207) (11,037) (10,691) (9,591) (22,165)
-------- -------- -------- -------- -------- -------- -------- --------
Net increase (decrease) in net
assets............................ 82,485 203,430 61,267 79,627 (5,737) 12,265 (10,865) 4,778
Net assets beginning of year....... 551,041 347,611 605,183 525,556 182,778 170,513 106,118 101,340
-------- -------- -------- -------- -------- -------- -------- --------
Net assets end of year*............ $633,526 $551,041 $666,450 $605,183 $177,041 $182,778 $ 95,253 $106,118
======== ======== ======== ======== ======== ======== ======== ========
Units outstanding beginning of
year.............................. 15,643 12,809 16,377 18,826 8,556 9,112 3,869 4,777
Units issued during the year....... 1,232 8,221 1,004 1,763 562 652 226 296
Units redeemed during the year..... (1,917) (5,387) (2,232) (4,212) (1,077) (1,208) (591) (1,204)
-------- -------- -------- -------- -------- -------- -------- --------
Units outstanding end of year...... 14,958 15,643 15,149 16,377 8,041 8,556 3,504 3,869
======== ======== ======== ======== ======== ======== ======== ========
- ---------------
*Includes undistributed net
investment income of: $114,981 $118,647 $251,131 $253,780 $154,460 $155,523 $ 94,948 $ 95,530
<CAPTION>
VARIABLE LIFE
-------------------------------------------
DIVERSIFIED MONEY MARKET
SUBACCOUNT SUBACCOUNT
--------------------- -------------------
1996 1995 1996 1995
---------- -------- -------- --------
<S> <C> <C> <C> <C>
From operations:
Net investment income (loss)...... $ (6,210) $ 46,804 $ 3,835 $ 5,662
Net realized gain on
investments..................... 29,580 35,442 0 0
Net increase (decrease) in
unrealized appreciation of
investments..................... 110,202 125,651 0 0
---------- -------- ------- --------
Net increase (decrease) in net
assets resulting from operations.. 133,572 207,897 3,835 5,662
---------- -------- ------- --------
From unit transactions:
Net proceeds from the issuance of
units........................... 85,626 90,610 9,558 137,395
Net asset value of units redeemed
or used to meet contract
obligations..................... (124,946) (145,580) (18,398) (235,050)
---------- -------- ------- --------
Net increase (decrease) from unit
transactions...................... (39,320) (54,970) (8,840) (97,655)
---------- -------- ------- --------
Net increase (decrease) in net
assets............................ 94,252 152,927 (5,005) (91,993)
Net assets beginning of year....... 989,489 836,562 90,294 182,287
---------- -------- ------- --------
Net assets end of year*............ $1,083,741 $989,489 $85,289 $ 90,294
========== ======== ======= ========
Units outstanding beginning of
year.............................. 35,607 37,807 5,499 11,659
Units issued during the year....... 2,942 3,647 570 8,586
Units redeemed during the year..... (4,270) (5,847) (1,099) (14,746)
---------- -------- ------- --------
Units outstanding end of year...... 34,279 35,607 4,970 5,499
========== ======== ======= ========
- ---------------
*Includes undistributed net
investment income of: $ 455,761 $461,971 $73,487 $ 69,652
</TABLE>
See notes to financial statements.
F-18
<PAGE> 70
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
VARIABLE UNIVERSAL LIFE
--------------------------------------------------------------------------------
INTERMEDIATE TERM LONG TERM GOVERNMENT
BOND BOND SECURITIES
SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------------------------- ------------------------------- ------------
FOR THE PERIOD FOR THE PERIOD
FOR THE YEAR APRIL 20, 1995** FOR THE YEAR MARCH 31, 1995** FOR THE YEAR
ENDED THROUGH ENDED THROUGH ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1996 1995 1996 1995 1996
------------ ---------------- ------------ ---------------- ------------
<S> <C> <C> <C> <C> <C>
From operations:
Net investment income (loss)..... $ (404) $ 1,414 $ (3,193) $ 13,958 $ (1,630)
Net realized gain (loss) on
investments.................... (715) 374 795 1,166 906
Net increase (decrease) in
unrealized appreciation of
investments.................... 3,148 (915) 13,609 8,277 7,805
------- ------- -------- -------- --------
Net increase in net assets
resulting from operations........ 2,029 873 11,211 23,401 7,081
------- ------- -------- -------- --------
From unit transactions:
Net proceeds from the issuance of
units.......................... 82,991 29,827 425,430 254,605 149,977
Net asset value of units redeemed
or used to meet contract
obligations.................... (20,916) (3,980) (91,922) (8,194) (35,779)
------- ------- -------- -------- --------
Net increase from unit
transactions..................... 62,075 25,847 333,508 246,411 114,198
------- ------- -------- -------- --------
Net increase in net assets......... 64,104 26,720 344,719 269,812 121,279
Net assets beginning of period..... 26,720 0 269,812 0 171,378
------- ------- -------- -------- --------
Net assets end of period*.......... $90,824 $26,720 $614,531 $269,812 $292,657
======= ======= ======== ======== ========
Units outstanding beginning of
period........................... 2,464 0 22,127 0 15,959
Units issued during the period..... 7,592 2,838 36,743 22,925 13,851
Units redeemed during the period... (1,918) (374) (7,960) (798) (3,312)
------- ------- -------- -------- --------
Units outstanding end of period.... 8,138 2,464 50,910 22,127 26,498
======= ======= ======== ======== ========
- ---------------
*Includes undistributed net
investment income of: $ 1,010 $ 1,414 $ 10,765 $ 13,958 $ 3,464
**Commencement of operations.
<CAPTION>
VARIABLE UNIVERSAL LIFE
-----------------------------------------------------
GOVERNMENT MONEY
SECURITIES MARKET
SUBACCOUNT SUBACCOUNT
---------------- ----------------------------------
FOR THE PERIOD FOR THE PERIOD
MARCH 20, 1995** FOR THE YEAR FEBRUARY 17, 1995**
THROUGH ENDED THROUGH
DECEMBER 31, DECEMBER 31, DECEMBER 31,
1995 1996 1995
---------------- ------------ -------------------
<S> <C> <C> <C>
From operations:
Net investment income (loss)..... $ 5,094 $ 86,414 $ 20,376
Net realized gain (loss) on
investments.................... 133 0 0
Net increase (decrease) in
unrealized appreciation of
investments.................... (708) 0 0
-------- ------------ -----------
Net increase in net assets
resulting from operations........ 4,519 86,414 20,376
-------- ------------ -----------
From unit transactions:
Net proceeds from the issuance of
units.......................... 171,901 15,675,163 8,289,772
Net asset value of units redeemed
or used to meet contract
obligations.................... (5,042) (13,113,154) (6,609,331)
-------- ------------ -----------
Net increase from unit
transactions..................... 166,859 2,562,009 1,680,441
-------- ------------ -----------
Net increase in net assets......... 171,378 2,648,423 1,700,817
Net assets beginning of period..... 0 1,700,817 0
-------- ------------ -----------
Net assets end of period*.......... $171,378 $ 4,349,240 $ 1,700,817
======== ============ ===========
Units outstanding beginning of
period........................... 0 163,465 0
Units issued during the period..... 16,439 1,469,700 807,565
Units redeemed during the period... (480) (1,232,600) (644,100)
-------- ------------ -----------
Units outstanding end of period.... 15,959 400,565 163,465
======== ============ ===========
- ---------------
*Includes undistributed net
investment income of: $ 5,094 $ 106,790 $ 20,376
**Commencement of operations.
</TABLE>
See notes to financial statements.
F-19
<PAGE> 71
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
VARIABLE UNIVERSAL LIFE (CONTINUED)
------------------------------------------------------------------------------
MANAGED
EQUITY SUBACCOUNT SMALL CAP SUBACCOUNT SUBACCOUNT
------------------------------ ------------------------------ ------------
FOR THE PERIOD FOR THE PERIOD
FOR THE YEAR MARCH 8, 1995** FOR THE YEAR MARCH 9, 1995** FOR THE YEAR
ENDED THROUGH ENDED THROUGH ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1996 1995 1996 1995 1996
------------ --------------- ------------ --------------- ------------
<S> <C> <C> <C> <C> <C>
From operations:
Net investment income (loss)................ $ 46,194 $ 25,168 $ 28,953 $ 16,433 $ 134,759
Net realized gain on investments............ 174,857 23,391 30,574 9,760 783,666
Net increase (decrease) in unrealized
appreciation of investments............... 357,881 23,213 78,392 (4,063) 2,166,435
---------- ---------- ---------- -------- -----------
Net increase in net assets resulting from
operations.................................. 578,932 71,772 137,919 22,130 3,084,860
---------- ---------- ---------- -------- -----------
From unit transactions:
Net proceeds from the issuance of units..... 4,459,200 1,073,215 2,152,749 662,265 20,620,582
Net asset value of units redeemed or used to
meet contract obligations................. (952,864) (100,511) (454,428) (83,568) (4,735,332)
---------- ---------- ---------- -------- -----------
Net increase from unit transactions.......... 3,506,336 972,704 1,698,321 578,697 15,885,250
---------- ---------- ---------- -------- -----------
Net increase in net assets................... 4,085,268 1,044,476 1,836,240 600,827 18,970,110
Net assets beginning of period............... 1,044,476 0 600,827 0 6,239,963
---------- ---------- ---------- -------- -----------
Net assets end of period*.................... $5,129,744 $1,044,476 $2,437,067 $600,827 $25,210,073
========== ========== ========== ======== ===========
Units outstanding beginning of period........ 80,766 0 52,194 0 465,095
Units issued during the period............... 303,412 88,980 176,984 59,708 1,382,408
Units redeemed during the period............. (65,176) (8,214) (37,435) (7,514) (315,017)
---------- ---------- ---------- -------- -----------
Units outstanding end of period.............. 319,002 80,766 191,743 52,194 1,532,486
========== ========== ========== ======== ===========
- ---------------
*Includes undistributed net investment
income of:.................................. $ 71,362 $ 25,168 $ 45,386 $ 16,433 $ 318,832
**Commencement of operations.
<CAPTION>
VARIABLE UNIVERSAL LIFE (CONTINUED)
----------------------------------------------------------------------------------
INTERNATIONAL HIGH YIELD
MANAGED GROWTH BOND
SUBACCOUNT SUBACCOUNT SUBACCOUNT
--------------- ------------------------------ -------------------------------
FOR THE PERIOD FOR THE PERIOD FOR THE PERIOD
MARCH 8, 1995** FOR THE YEAR MARCH 8, 1995** FOR THE YEAR MARCH 20, 1995**
THROUGH ENDED THROUGH ENDED THROUGH
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1995 1996 1995 1996 1995
--------------- ------------ --------------- ------------ ----------------
<S> <C> <C> <C> <C> <C>
From operations:
Net investment income (loss)................ $ 184,073 $ (1,058) $ 17,938 $ 42,346 $ 7,401
Net realized gain on investments............ 123,272 23,372 6,166 180 190
Net increase (decrease) in unrealized
appreciation of investments............... 92,118 96,691 (109) 25,863 361
---------- ---------- -------- -------- --------
Net increase in net assets resulting from
operations.................................. 399,463 119,005 23,995 68,389 7,952
---------- ---------- -------- -------- --------
From unit transactions:
Net proceeds from the issuance of units..... 6,530,478 1,524,746 394,240 535,643 367,392
Net asset value of units redeemed or used to
meet contract obligations................. (689,978) (291,724) (38,818) (125,293) (22,635)
---------- ---------- -------- -------- --------
Net increase from unit transactions.......... 5,840,500 1,233,022 355,422 410,350 344,757
---------- ---------- -------- -------- --------
Net increase in net assets................... 6,239,963 1,352,027 379,417 478,739 352,709
Net assets beginning of period............... 0 379,417 0 352,709 0
---------- ---------- -------- -------- --------
Net assets end of period*.................... $6,239,963 $1,731,444 $379,417 $831,448 $352,709
========== ========== ======== ======== ========
Units outstanding beginning of period........ 0 31,566 0 31,730 0
Units issued during the period............... 519,384 120,205 34,979 45,756 33,810
Units redeemed during the period............. (54,289) (22,951) (3,413) (10,777) (2,080)
---------- ---------- -------- -------- --------
Units outstanding end of period.............. 465,095 128,820 31,566 66,709 31,730
========== ========== ======== ======== ========
- ---------------
*Includes undistributed net investment
income of:.................................. $ 184,073 $ 16,880 $ 17,938 $ 49,747 $ 7,401
**Commencement of operations.
</TABLE>
See notes to financial statements.
F-20
<PAGE> 72
MONY AMERICA
VARIABLE ACCOUNT L
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION AND BUSINESS
MONY America Variable Account L (the "Variable Account") is a separate
investment account established on February 19, 1985 by MONY Life Insurance
Company of America ("MONY America"), under the laws of the State of Arizona.
The Variable Account operates as a unit investment trust under the
Investment Company Act of 1940 (the "1940 Act"). The Variable Account holds
assets that are segregated from all of MONY America's other assets and, at
present, is used to support Variable Life Insurance and Variable Universal Life
Insurance Policies. These policies are issued by MONY America, which is a
wholly-owned subsidiary of The Mutual Life Insurance Company of New York
("MONY"). MONY America is currently taxed as a life insurance company and will
include the Variable Account's operations in its tax return. MONY America does
not expect, based on current tax law, to incur any income tax burden upon the
earnings or realized capital gains attributable to the Variable Account. Based
on this expectation, no charges are currently being deducted from the Variable
Account for federal income tax purposes.
There are currently fifteen subaccounts within the Variable Account, each
invests only in a corresponding portfolio of the MONY Series Fund, Inc. (the
"Fund") or the Enterprise Accumulation Trust ("Enterprise") (collectively, the
"Funds"). The subaccounts of the Variable Universal Life commenced operations
during 1995. The Funds are registered under the 1940 Act as open end,
diversified, management investment companies.
2. SIGNIFICANT ACCOUNTING POLICIES
Investment:
The investment in shares of each of the respective portfolios is stated at
value which is the net asset values of the Funds. Except for the Money Market
Portfolios, net asset values are based upon market quotations of the securities
held in each of the corresponding portfolios of the Funds. For the Money Market
Portfolios, the net asset values are based on amortized cost of the securities
held which approximates value.
3. RELATED PARTY TRANSACTIONS
MONY America is the legal owner of the assets held by the Variable Account.
Policy premiums received from MONY America by the Variable Account
represent gross policy premiums recorded by MONY America less deductions
retained as compensation for certain sales distribution expenses and premium
taxes.
The cost of insurance, administration charges, and, if applicable, the cost
of any optional benefits added by riders are deducted on each monthly date from
the cash value of the contract to compensate MONY America. These deductions are
treated as contractholder redemptions by the Variable Account. The amount
deducted for all subaccounts for 1996 aggregated $5,429,287.
MONY America receives from the Variable Account the amounts deducted for
mortality and expense risks at an annual rate of .60 percent (for the Variable
Life Subaccounts) and .75 percent (for the Variable Universal Life Subaccounts)
of aggregate average daily net assets. As investment adviser to the Fund, it
receives amounts paid by the Fund for those services.
Enterprise Capital Management, Inc., a wholly-owned subsidiary of MONY,
acts as investment adviser to Enterprise, and it receives amounts paid by
Enterprise for those services.
F-21
<PAGE> 73
MONY AMERICA
VARIABLE ACCOUNT L
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
4. INVESTMENTS
Investments in Variable Life at cost, at December 31, 1996 consist of the
following:
<TABLE>
<CAPTION>
MONY SERIES FUND, INC.
--------------------------------------------------------------------------
EQUITY EQUITY INTERMEDIATE LONG TERM MONEY
GROWTH INCOME TERM BOND BOND DIVERSIFIED MARKET
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- --------- ------------ --------- ----------- ---------
<S> <C> <C> <C> <C> <C> <C>
Shares beginning of year:
Shares........................ 21,945 30,861 17,293 8,239 62,944 90,294
Amount........................ $493,463 $499,432 $180,391 $ 95,586 $ 854,895 $ 90,294
-------- -------- -------- -------- --------- --------
Shares acquired:
Shares........................ 2,219 2,202 1,526 607 5,732 13,550
Amount........................ $ 60,760 $ 46,746 $ 16,166 $ 7,492 $ 95,355 $ 13,550
Shares received for reinvestment
of dividends:
Shares........................ 0 58 0 0 0 4,359
Amount........................ $ 0 $ 1,204 $ 0 $ 0 $ 0 $ 4,359
Shares redeemed:
Shares........................ (3,304) (4,689) (2,666) (1,428) (8,436) (22,914)
Amount........................ $(70,648) $(66,846) $(27,601) $(15,676) $(111,305) $(22,914)
-------- -------- -------- -------- --------- --------
Net change:
Shares........................ (1,085) (2,429) (1,140) (821) (2,704) (5,005)
Amount........................ $ (9,888) $(18,896) $(11,435) $ (8,184) $ (15,950) $ (5,005)
-------- -------- -------- -------- --------- --------
Shares end of year:
Shares........................ 20,860 28,432 16,153 7,418 60,240 85,289
Amount........................ $483,575 $480,536 $168,956 $ 87,402 $ 838,945 $ 85,289
======== ======== ======== ======== ========= ========
</TABLE>
F-22
<PAGE> 74
MONY AMERICA
VARIABLE ACCOUNT L
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
4. INVESTMENTS (CONTINUED)
Investments in Variable Universal Life at cost, at December 31, 1996
consist of the following:
<TABLE>
<CAPTION>
MONY SERIES FUND, INC.
----------------------------------------------------
INTERMEDIATE LONG TERM GOVERNMENT MONEY
TERM BOND BOND SECURITIES MARKET
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
------------ --------- ---------- ------------
<S> <C> <C> <C> <C>
Shares beginning of
year:
Shares............. 2,528 20,948 16,786 1,700,817
Amount............. $ 27,635 $ 261,535 $172,086 $ 1,700,817
-------- --------- -------- ------------
Shares acquired:
Shares............. 9,370 39,960 16,103 18,374,077
Amount............. $100,064 $ 490,126 $166,533 $ 18,374,077
Shares received for
reinvestment of
dividends:
Shares............. 0 0 0 101,677
Amount............. $ 0 $ 0 $ 0 $ 101,677
Shares redeemed:
Shares............. (3,611) (13,047) (5,228) (15,827,331)
Amount............. $(39,108) $(159,016) $(53,059) $(15,827,331)
-------- --------- -------- ------------
Net change:
Shares............. 5,759 26,913 10,875 2,648,423
Amount............. $ 60,956 $ 331,110 $113,474 $ 2,648,423
-------- --------- -------- ------------
Shares end of year:
Shares............. 8,287 47,861 27,661 4,349,240
Amount............. $ 88,591 $ 592,645 $285,560 $ 4,349,240
======== ========= ======== ============
<CAPTION>
ENTERPRISE ACCUMULATION TRUST
------------------------------------------------------------------
HIGH
INTERNATIONAL YIELD
EQUITY SMALL CAP MANAGED GROWTH BOND
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------- ---------- ----------- ------------- ---------
<S> <C> <C> <C> <C> <C>
Shares beginning of
year:
Shares............. 44,731 32,512 222,380 70,393 66,424
Amount............. $ 1,021,263 $ 604,890 $ 6,147,845 $ 379,526 $ 352,348
----------- ---------- ----------- ---------- ---------
Shares acquired:
Shares............. 178,410 118,551 697,438 290,568 95,894
Amount............. $ 4,751,773 $2,322,833 $21,848,142 $1,658,305 $ 794,242
Shares received for
reinvestment of
dividends:
Shares............. 2,295 1,941 7,108 1,028 61,650
Amount............. $ 66,222 $ 39,244 $ 243,882 $ 6,221 $ 46,366
Shares redeemed:
Shares............. (47,690) (32,477) (192,152) (75,800) (73,070)
Amount............. $(1,090,608) $ (604,229) $(5,288,349) $ (409,190) $(387,732)
----------- ---------- ----------- ---------- ---------
Net change:
Shares............. 133,015 88,015 512,394 215,796 84,474
Amount............. $ 3,727,387 $1,757,848 $16,803,675 $1,255,336 $ 452,876
----------- ---------- ----------- ---------- ---------
Shares end of year:
Shares............. 177,746 120,527 734,774 286,189 150,898
Amount............. $ 4,748,650 $2,362,738 $22,951,520 $1,634,862 $ 805,224
=========== ========== =========== ========== =========
</TABLE>
F-23
<PAGE> 75
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors of
MONY Life Insurance Company of America and the
Contractholders of MONY America Variable Account L:
We have audited the accompanying statements of assets and liabilities of
MONY America Variable Account L (comprising, respectively, the Variable Life's
Equity Growth, Equity Income, Intermediate Term Bond, Long Term Bond,
Diversified and Money Market Subaccounts and the Variable Universal Life's
Intermediate Term Bond, Long Term Bond, Government Securities, Money Market,
Equity, Small Cap, Managed, International Growth and High Yield Bond Subaccounts
as of December 31, 1995, for the Variable Life's Subaccount the related
statements of operations for the year then ended and the statements of changes
in net assets for each of the two years in the period then ended, and for the
Variable Universal Life's Subaccounts the statements of operations and
statements of changes in net assets for the Intermediate Term Bond Subaccount
for which the period is from April 20, 1995 (commencement of operations) to
December 31, 1995, the Long Term Bond Subaccount for which the period is from
March 31, 1995 (commencement of operations) to December 31, 1995, the Government
Securities and High Yield Subaccounts for which the period is March 20, 1995
(commencement of operations) to December 31, 1995, the Money Market Subaccount
for which the period is from February 17, 1995 (commencement of operations) to
December 31, 1995, the Equity, Managed and International Subaccounts for which
the period is from March 8, 1995 (commencement of operations) to December 31,
1995, and the Small Cap Subaccounts for which the period is from March 9, 1995
(commencement of operations) to December 31, 1995. These financial statements
are the responsibility of MONY America's management. Our responsibility is to
express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. Our procedures included
confirmation of securities owned as of December 31, 1995, by correspondence with
the custodian. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of each of the respective
subaccounts constituting MONY America Variable Account L as of December 31,
1995, the results of their operations, and the changes in their net assets for
each of the periods referred to above, in conformity with generally accepted
accounting principles.
COOPERS & LYBRAND L.L.P.
New York, New York
February 19, 1996
F-24
<PAGE> 76
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF ASSETS AND LIABILITIES
DECEMBER 31, 1995
<TABLE>
<CAPTION>
VARIABLE LIFE
------------------------------------------------------------------------------
EQUITY EQUITY INTERMEDIATE LONG TERM MONEY
GROWTH INCOME TERM BOND BOND DIVERSIFIED MARKET
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------- ---------- ------------ ---------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Investments at cost (Note 4).... $ 493,463 $ 499,432 $ 180,391 $ 95,586 $ 854,895 $ 90,294
========= ========= ========= ========= ========== ==========
Investments in MONY Series Fund,
Inc. at net asset value (Note
2)............................ $ 551,041 $ 605,183 $ 182,778 $ 106,118 $ 989,489 $ 90,294
Amount due from MONY America.... 0 9 0 0 65 6
Amount due from MONY Series
Fund, Inc. ................... 239 338 91 1 357 4
--------- --------- --------- --------- ---------- ----------
Total assets.......... 551,280 605,530 182,869 106,119 989,911 90,304
--------- --------- --------- --------- ---------- ----------
LIABILITIES
Amount due to MONY America...... 239 338 91 1 357 4
Amount due to MONY Series
Fund, Inc. ................... 0 9 0 0 65 6
--------- --------- --------- --------- ---------- ----------
Total liabilities..... 239 347 91 1 422 10
--------- --------- --------- --------- ---------- ----------
Net assets...................... $ 551,041 $ 605,183 $ 182,778 $ 106,118 $ 989,489 $ 90,294
========= ========= ========= ========= ========== ==========
Net assets consist of:
Contractholders' net
payments................. $ 531,034 $ 578,333 $ 207,122 $ 124,860 $1,050,514 $ 192,695
Cost of insurance
withdrawals (Note 3)..... (323,941) (413,683) (173,922) (129,844) (784,109) (172,053)
Undistributed net
investment income........ 118,647 253,780 155,523 95,530 461,971 69,652
Accumulated net realized
gains (loss) on
investments.............. 167,723 81,002 (8,332) 5,040 126,519 0
Unrealized appreciation of
investments.............. 57,578 105,751 2,387 10,532 134,594 0
--------- --------- --------- --------- ---------- ----------
Net assets...................... $ 551,041 $ 605,183 $ 182,778 $ 106,118 $ 989,489 $ 90,294
========= ========= ========= ========= ========== ==========
Number of units outstanding*.... 15,643 16,377 8,556 3,869 35,607 5,499
--------- --------- --------- --------- ---------- ----------
Net asset value per unit
outstanding................... $ 35.23 $ 36.95 $ 21.36 $ 27.43 $ 27.79 $ 16.42
========= ========= ========= ========= ========== ==========
</TABLE>
- ---------------
* Units outstanding have been rounded for presentation purposes.
See notes to financial statements.
F-25
<PAGE> 77
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF ASSETS AND LIABILITIES (CONTINUED)
DECEMBER 31, 1995
<TABLE>
<CAPTION>
VARIABLE UNIVERSAL LIFE
-----------------------------------------------------------------------------
INTERMEDIATE LONG TERM GOVERNMENT MONEY
TERM BOND BOND SECURITIES MARKET EQUITY SMALL CAP
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------ ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Investments at cost (Note 4)...................... $27,635 $261,535 $172,086 $1,700,817 $1,021,263 $604,890
======= ======== ======== ========== ========== ========
Investments in Enterprise Accumulation Trust at
net asset value (Note 2)........................ $ 0 $ 0 $ 0 $ 0 $1,044,476 $600,827
Investments in MONY Series Fund, Inc. at net asset
value (Note 2).................................. 26,720 269,812 171,378 1,700,817 0 0
Amount due from Enterprise Accumulation Trust..... 0 0 0 0 364 306
Amount due from MONY America...................... 0 22 0 29,305 375 483
Amount due from MONY Series Fund, Inc............. 13 6 23 7 0 0
------- -------- -------- ---------- ---------- --------
Total assets.............................. 26,733 269,840 171,401 1,730,129 1,045,215 601,616
------- -------- -------- ---------- ---------- --------
LIABILITIES
Amount due to Enterprise Accumulation Trust....... 0 0 0 0 375 483
Amount due to MONY America........................ 13 6 23 7 364 306
Amount due to MONY Series Fund, Inc............... 0 22 0 29,305 0 0
------- -------- -------- ---------- ---------- --------
Total liabilities......................... 13 28 23 29,312 739 789
------- -------- -------- ---------- ---------- --------
Net assets........................................ $26,720 $269,812 $171,378 $1,700,817 $1,044,476 $600,827
======= ======== ======== ========== ========== ========
Net assets consist of:
Contractholders' net payments................. $27,817 $254,451 $171,675 $1,710,823 $1,065,456 $644,769
Cost of insurance withdrawals (Note 3)........ (1,970) (8,040) (4,816) (30,382) (92,752) (66,072)
Undistributed net investment income........... 1,414 13,958 5,094 20,376 25,168 16,433
Accumulated net realized gains on
investments................................. 374 1,166 133 0 23,391 9,760
Unrealized appreciation (depreciation) of
investments................................. (915) 8,277 (708) 0 23,213 (4,063)
------- -------- -------- ---------- ---------- --------
Net assets........................................ $26,720 $269,812 $171,378 $1,700,817 $1,044,476 $600,827
======= ======== ======== ========== ========== ========
Number of units outstanding*...................... 2,464 22,127 15,959 163,465 80,766 52,194
------- -------- -------- ---------- ---------- --------
Net asset value per unit outstanding.............. $ 10.84 $ 12.19 $ 10.74 $ 10.40 $ 12.93 $ 11.51
======= ======== ======== ========== ========== ========
<CAPTION>
VARIABLE UNIVERSAL LIFE
---------------------------------------
INTERNATIONAL HIGH YIELD
MANAGED GROWTH BOND
SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------- ------------- ----------
<S> <C> <C> <C>
ASSETS
Investments at cost (Note 4)...................... $6,147,845 $379,526 $352,348
========== ======== ========
Investments in Enterprise Accumulation Trust at
net asset value (Note 2)........................ $6,239,963 $379,417 $352,709
Investments in MONY Series Fund, Inc. at net asset
value (Note 2).................................. 0 0 0
Amount due from Enterprise Accumulation Trust..... 15,893 202 61
Amount due from MONY America...................... 1,689 376 173
Amount due from MONY Series Fund, Inc............. 0 0 0
---------- -------- --------
Total assets.............................. 6,257,545 379,995 352,943
---------- -------- --------
LIABILITIES
Amount due to Enterprise Accumulation Trust....... 1,689 376 173
Amount due to MONY America........................ 15,893 202 61
Amount due to MONY Series Fund, Inc............... 0 0 0
---------- -------- --------
Total liabilities......................... 17,582 578 234
---------- -------- --------
Net assets........................................ $6,239,963 $379,417 $352,709
========== ======== ========
Net assets consist of:
Contractholders' net payments................. $6,329,873 $389,734 $362,971
Cost of insurance withdrawals (Note 3)........ (489,373) (34,312) (18,214)
Undistributed net investment income........... 184,073 17,938 7,401
Accumulated net realized gains on
investments................................. 123,272 6,166 190
Unrealized appreciation (depreciation) of
investments................................. 92,118 (109) 361
---------- -------- --------
Net assets........................................ $6,239,963 $379,417 $352,709
========== ======== ========
Number of units outstanding*...................... 465,095 31,566 31,730
---------- -------- --------
Net asset value per unit outstanding.............. $ 13.42 $ 12.02 $ 11.12
========== ======== ========
</TABLE>
- ---------------
* Units outstanding have been rounded for presentation purposes.
See notes to financial statements.
F-26
<PAGE> 78
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1995
<TABLE>
<CAPTION>
VARIABLE LIFE
------------------------------------------------------------------------------
EQUITY EQUITY INTERMEDIATE LONG TERM MONEY
GROWTH INCOME TERM BOND BOND DIVERSIFIED MARKET
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------- ---------- ------------ ---------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Dividend income..................... $ 36,269 $ 31,156 $10,214 $ 5,730 $ 52,334 $ 6,355
Mortality and expense risk charges
(Note 3).......................... 2,810 3,334 1,049 629 5,530 693
-------- -------- ------- ------- -------- --------
Net investment income............... 33,459 27,822 9,165 5,101 46,804 5,662
-------- -------- ------- ------- -------- --------
Realized and unrealized gain on
investments (Note 2):
Proceeds from sales............... 201,342 154,706 30,377 41,657 185,053 264,962
Cost of shares sold............... 171,034 115,616 28,318 36,449 149,611 264,962
-------- -------- ------- ------- -------- --------
Net realized gains on investments... 30,308 39,090 2,059 5,208 35,442 0
Net increase in unrealized
appreciation of investments....... 57,362 88,922 11,732 16,634 125,651 0
-------- -------- ------- ------- -------- --------
Net realized and unrealized gains on
investments....................... 87,670 128,012 13,791 21,842 161,093 0
-------- -------- ------- ------- -------- --------
Net increase in net assets resulting
from operations................... $121,129 $155,834 $22,956 $26,943 $207,897 $ 5,662
======== ======== ======= ======= ======== ========
</TABLE>
See notes to financial statements.
F-27
<PAGE> 79
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF OPERATIONS (CONTINUED)
<TABLE>
<CAPTION>
VARIABLE UNIVERSAL LIFE
------------------------------------------------------------------------------------------
INTERMEDIATE LONG TERM GOVERNMENT MONEY
TERM BOND BOND SECURITIES MARKET EQUITY
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
--------------- --------------- --------------- ------------------ ---------------
FOR THE PERIOD FOR THE PERIOD FOR THE PERIOD FOR THE PERIOD FOR THE PERIOD
APRIL 20, MARCH 31, MARCH 20, FEBRUARY 17, MARCH 8,
1995* 1995* 1995* 1995* 1995*
THROUGH THROUGH THROUGH THROUGH THROUGH
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1995 1995 1995 1995 1995
--------------- --------------- --------------- ------------------ ---------------
<S> <C> <C> <C> <C> <C>
Dividend income.................. $ 1,489 $14,565 $ 5,452 $ 23,644 $ 27,509
Mortality and expense risk
charges (Note 3)............... 75 607 358 3,268 2,341
------- ------- ------- ---------- --------
Net investment income............ 1,414 13,958 5,094 20,376 25,168
------- ------- ------- ---------- --------
Realized and unrealized gains on
investments (Note 2):
Proceeds from sales............ 14,675 23,454 20,277 8,312,134 187,733
Cost of shares sold............ 14,301 22,288 20,144 8,312,134 164,342
------- ------- ------- ---------- --------
Net realized gains on
investments.................... 374 1,166 133 0 23,391
Net increase (decrease) in
unrealized appreciation of
investments.................... (915) 8,277 (708) 0 23,213
------- ------- ------- ---------- --------
Net realized and unrealized gains
(losses) on investments........ (541) 9,443 (575) 0 46,604
------- ------- ------- ---------- --------
Net increase in net assets
resulting from operations...... $ 873 $23,401 $ 4,519 $ 20,376 $ 71,772
======= ======= ======= ========== ========
<CAPTION>
VARIABLE UNIVERSAL LIFE
---------------------------------------------------------------------
INTERNATIONAL HIGH YIELD
SMALL CAP MANAGED GROWTH BOND
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
--------------- --------------- --------------- ---------------
FOR THE PERIOD FOR THE PERIOD FOR THE PERIOD FOR THE PERIOD
MARCH 9, MARCH 8, MARCH 8, MARCH 20,
1995* 1995* 1995* 1995*
THROUGH THROUGH THROUGH THROUGH
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1995 1995 1995 1995
--------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Dividend income.................. $17,779 $ 197,666 $18,775 $ 8,030
Mortality and expense risk
charges (Note 3)............... 1,346 13,593 837 629
------- ---------- ------- --------
Net investment income............ 16,433 184,073 17,938 7,401
------- ---------- ------- --------
Realized and unrealized gains on
investments (Note 2):
Proceeds from sales............ 156,201 1,299,150 85,432 112,342
Cost of shares sold............ 146,441 1,175,878 79,266 112,152
------- ---------- ------- --------
Net realized gains on
investments.................... 9,760 123,272 6,166 190
Net increase (decrease) in
unrealized appreciation of
investments.................... (4,063) 92,118 (109) 361
------- ---------- ------- --------
Net realized and unrealized gains
(losses) on investments........ 5,697 215,390 6,057 551
------- ---------- ------- --------
Net increase in net assets
resulting from operations...... $22,130 $ 399,463 $23,995 $ 7,952
======= ========== ======= ========
</TABLE>
- ---------------
* Commencement of operations.
See notes to financial statements.
F-28
<PAGE> 80
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEARS ENDED DECEMBER 31,
<TABLE>
<CAPTION>
VARIABLE LIFE
---------------------------------------------------------------
EQUITY GROWTH EQUITY INCOME INTERMEDIATE TERM
SUBACCOUNT SUBACCOUNT BOND SUBACCOUNT
------------------- ------------------- -------------------
1995 1994 1995 1994 1995 1994
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
From operations:
Net investment income...................... $ 33,459 $ 6,953 $ 27,822 $ 29,418 $ 9,165 $ 8,849
Net realized gains on investments.......... 30,308 9,428 39,090 11,825 2,059 765
Net increase (decrease) in unrealized
appreciation of investments.............. 57,362 (10,655) 88,922 (40,147) 11,732 (13,415)
-------- -------- -------- -------- -------- --------
Net increase (decrease) in net assets
resulting from operations.................. 121,129 5,726 155,834 1,096 22,956 (3,801)
-------- -------- -------- -------- -------- --------
From unit transactions:
Net proceeds from the issuance of units.... 246,538 40,449 56,024 49,919 13,113 12,962
Net asset value of units redeemed or used
to meet contract obligations............. 164,237 118,555 132,231 79,426 23,804 21,236
-------- -------- -------- -------- -------- --------
Net increase (decrease) from unit
transactions............................... 82,301 (78,106) (76,207) (29,507) (10,691) (8,274)
-------- -------- -------- -------- -------- --------
Net increase (decrease) in net assets........ 203,430 (72,380) 79,627 (28,411) 12,265 (12,075)
Net assets beginning of year................. 347,611 419,991 525,556 553,967 170,513 182,588
-------- -------- -------- -------- -------- --------
Net assets end of year*...................... $551,041 $347,611 $605,183 $525,556 $182,778 $170,513
======== ======== ======== ======== ======== ========
Units outstanding beginning of year.......... 12,809 15,712 18,826 19,878 9,112 9,552
Units issued during the year................. 8,221 1,506 1,763 1,767 652 692
Units redeemed during the year............... 5,387 4,409 4,212 2,819 1,208 1,132
-------- -------- -------- -------- -------- --------
Units outstanding end of year................ 15,643 12,809 16,377 18,826 8,556 9,112
======== ======== ======== ======== ======== ========
- ---------------
*Includes undistributed net investment income
of: $118,647 $ 85,188 $253,780 $225,958 $155,523 $146,358
<CAPTION>
VARIABLE LIFE
---------------------------------------------------------------
LONG TERM DIVERSIFIED MONEY MARKET
BOND SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------------- ------------------- -------------------
1995 1994 1995 1994 1995 1994
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
From operations:
Net investment income...................... $ 5,101 $ 6,859 $ 46,804 $ 23,875 $ 5,662 $ 5,483
Net realized gains on investments.......... 5,208 1,489 35,442 17,533 0 0
Net increase (decrease) in unrealized
appreciation of investments.............. 16,634 (16,392) 125,651 (38,475) 0 0
-------- -------- -------- -------- -------- --------
Net increase (decrease) in net assets
resulting from operations.................. 26,943 (8,044) 207,897 2,933 5,662 5,483
-------- -------- -------- -------- -------- --------
From unit transactions:
Net proceeds from the issuance of units.... 7,195 6,144 90,610 95,640 137,395 93,348
Net asset value of units redeemed or used
to meet contract obligations............. 29,360 18,657 145,580 148,999 235,050 18,485
-------- -------- -------- -------- -------- --------
Net increase (decrease) from unit
transactions............................... (22,165) (12,513) (54,970) (53,359) (97,655) 74,863
-------- -------- -------- -------- -------- --------
Net increase (decrease) in net assets........ 4,778 (20,557) 152,927 (50,426) (91,993) 80,346
Net assets beginning of year................. 101,340 121,897 836,562 886,988 182,287 101,941
-------- -------- -------- -------- -------- --------
Net assets end of year*...................... $106,118 $101,340 $989,489 $836,562 $ 90,294 $182,287
======== ======== ======== ======== ======== ========
Units outstanding beginning of year.......... 4,777 5,361 37,807 40,254 11,659 6,734
Units issued during the year................. 296 290 3,647 4,346 8,586 6,128
Units redeemed during the year............... 1,204 874 5,847 6,793 14,746 1,203
-------- -------- -------- -------- -------- --------
Units outstanding end of year................ 3,869 4,777 35,607 37,807 5,499 11,659
======== ======== ======== ======== ======== ========
- ---------------
*Includes undistributed net investment income
of: $ 95,530 $ 90,429 $461,971 $415,167 $ 69,652 $ 63,990
</TABLE>
See notes to financial statements.
F-29
<PAGE> 81
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
VARIABLE UNIVERSAL LIFE
----------------------------------------------------------------------------------------------
INTERMEDIATE LONG TERM GOVERNMENT MONEY
TERM BOND BOND SECURITIES MARKET EQUITY
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------------- ---------------- ---------------- ------------------- ---------------
FOR THE PERIOD FOR THE PERIOD FOR THE PERIOD FOR THE PERIOD FOR THE PERIOD
APRIL 20, 1995** MARCH 31, 1995** MARCH 20, 1995** FEBRUARY 17, 1995** MARCH 8, 1995**
THROUGH THROUGH THROUGH THROUGH THROUGH
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1995 1995 1995 1995 1995
---------------- ---------------- ---------------- ------------------- ---------------
<S> <C> <C> <C> <C> <C>
From operations:
Net investment income........... $ 1,414 $ 13,958 $ 5,094 $ 20,376 $ 25,168
Net realized gains on
investments................... 374 1,166 133 0 23,391
Net increase (decrease) in
unrealized appreciation of
investments................... (915) 8,277 (708) 0 23,213
------- -------- -------- ---------- ----------
Net increase in net assets
resulting from operations....... 873 23,401 4,519 20,376 71,772
------- -------- -------- ---------- ----------
From unit transactions:
Net proceeds from the issuance
of units...................... 29,827 254,605 171,901 8,289,772 1,073,215
Net asset value of units
redeemed or used to meet
contract obligations.......... 3,980 8,194 5,042 6,609,331 100,511
------- -------- -------- ---------- ----------
Net increase from unit
transactions.................... 25,847 246,411 166,859 1,680,441 972,704
------- -------- -------- ---------- ----------
Net increase in net assets........ 26,720 269,812 171,378 1,700,817 1,044,476
Net assets beginning of year...... 0 0 0 0 0
------- -------- -------- ---------- ----------
Net assets end of year*........... $26,720 $269,812 $171,378 $1,700,817 $1,044,476
======= ======== ======== ========== ==========
Units outstanding beginning of
year............................ 0 0 0 0 0
Units issued during the year...... 2,838 22,925 16,439 807,565 88,980
Units redeemed during the year.... 374 798 480 644,100 8,214
------- -------- -------- ---------- ----------
Units outstanding end of year..... 2,464 22,127 15,959 163,465 80,766
======= ======== ======== ========== ==========
- ---------------
* Includes undistributed net
investment income of: $ 1,414 $ 13,958 $ 5,094 $ 20,376 $ 25,168
** Commencement of operations.
<CAPTION>
VARIABLE UNIVERSAL LIFE
----------------------------------------------------------------------
INTERNATIONAL HIGH YIELD
SMALL CAP MANAGED GROWTH BOND
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
--------------- --------------- --------------- ----------------
FOR THE PERIOD FOR THE PERIOD FOR THE PERIOD FOR THE PERIOD
MARCH 9, 1995** MARCH 8, 1995** MARCH 8, 1995** MARCH 20, 1995**
THROUGH THROUGH THROUGH THROUGH
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1995 1995 1995 1995
--------------- --------------- --------------- ----------------
<S> <C> <C> <C> <C>
From operations:
Net investment income........... $ 16,433 $ 184,073 $ 17,938 $ 7,401
Net realized gains on
investments................... 9,760 123,272 6,166 190
Net increase (decrease) in
unrealized appreciation of
investments................... (4,063) 92,118 (109) 361
-------- ---------- -------- --------
Net increase in net assets
resulting from operations....... 22,130 399,463 23,995 7,952
-------- ---------- -------- --------
From unit transactions:
Net proceeds from the issuance
of units...................... 662,265 6,530,478 394,240 367,392
Net asset value of units
redeemed or used to meet
contract obligations.......... 83,568 689,978 38,818 22,635
-------- ---------- -------- --------
Net increase from unit
transactions.................... 578,697 5,840,500 355,422 344,757
-------- ---------- -------- --------
Net increase in net assets........ 600,827 6,239,963 379,417 352,709
Net assets beginning of year...... 0 0 0 0
-------- ---------- -------- --------
Net assets end of year*........... $600,827 $6,239,963 $379,417 $352,709
======== ========== ======== ========
Units outstanding beginning of
year............................ 0 0 0 0
Units issued during the year...... 59,708 519,384 34,979 33,810
Units redeemed during the year.... 7,514 54,289 3,413 2,080
-------- ---------- -------- --------
Units outstanding end of year..... 52,194 465,095 31,566 31,730
======== ========== ======== ========
- ---------------
* Includes undistributed net
investment income of: $ 16,433 $ 184,073 $ 17,938 $ 7,401
** Commencement of operations.
</TABLE>
See notes to financial statements.
F-30
<PAGE> 82
MONY AMERICA
VARIABLE ACCOUNT L
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION AND BUSINESS
MONY America Variable Account L (the "Variable Account") is a separate
investment account established on February 19, 1985 by MONY Life Insurance
Company of America ("MONY America"), under the laws of the State of Arizona.
The Variable Account operates as a unit investment trust under the
Investment Company Act of 1940 (the "1940 Act"). The Variable Account holds
assets that are segregated from all of MONY America's other assets and, at
present, is used to support Variable Life Insurance and Variable Universal Life
Insurance Policies. These policies are issued by MONY America, which is a
wholly-owned subsidiary of The Mutual Life Insurance Company of New York
("MONY"). MONY America is currently taxed as a life insurance company and will
include the Variable Account's operations in its tax return. MONY America does
not expect, based on current tax law, to incur any income tax burden upon the
earnings or realized capital gains attributable to the Variable Account. Based
on this expectation, no charges are currently being deducted from the Variable
Account for federal income tax purposes.
There are currently fifteen subaccounts within the Variable Account, each
invests only in a corresponding portfolio of the MONY Series Fund, Inc. (the
"Fund") or the Enterprise Accumulation Trust ("Enterprise") (collectively, the
"Funds"). The subaccounts of the Variable Universal Life commenced operations
during 1995. The Funds are registered under the 1940 Act as an open end,
diversified, management investment companies.
A full presentation of the related financial statements and footnotes of
the Fund and Enterprise are contained on pages 66 to 128 and 129 to 174,
respectively, and should be read in conjunction with these financial statements.
2. SIGNIFICANT ACCOUNTING POLICIES
Investment:
The investment in shares of each of the respective portfolios is stated at
value which is the net asset values of the Fund. Except for the Money Market
Portfolio, net asset values are based upon market quotations of the securities
held in each of the corresponding portfolios of the Funds. For the Money Market
Portfolio, the net asset values are based on amortized cost of the securities
held which approximates value.
3. RELATED PARTY TRANSACTIONS
MONY America is the legal holder of the assets held by the Variable
Account.
Policy premiums received from MONY America by the Variable Account
represent gross policy premiums recorded by MONY America less deductions
retained as compensation for certain sales distribution expenses and premium
taxes.
The cost of insurance, administration charges, and, if applicable, the cost
of any optional benefits added by riders are deducted on each monthly date from
the cash value of the contract to compensate MONY America. These deductions are
treated as contractholder redemptions by the Variable Account. The amount
deducted for all subaccounts for 1995 aggregated $917,026.
MONY America receives from the Variable Account the amounts deducted for
mortality and expense risks at an annual rate of .60 percent (for the Variable
Life Subaccounts) and .75 percent (for the Variable Universal Life Subaccounts)
of aggregate average daily net assets. As investment adviser to the Fund, it
receives amounts paid by the Fund for those services.
F-31
<PAGE> 83
MONY AMERICA
VARIABLE ACCOUNT L
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
3. RELATED PARTY TRANSACTIONS (CONTINUED)
Enterprise Capital Management, Inc., a wholly-owned subsidiary of MONY,
acts as investment adviser to Enterprise, and it receives amounts paid by
Enterprise for those services.
4. INVESTMENTS
Investments in Variable Life at cost, at December 31, 1995 consist of the
following:
<TABLE>
<CAPTION>
LONG
EQUITY EQUITY INTERMEDIATE TERM MONEY
GROWTH INCOME TERM BOND BOND DIVERSIFIED MARKET
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- --------- ------------ --------- ----------- ---------
<S> <C> <C> <C> <C> <C> <C>
Shares beginning of year:
Shares.......................... 16,883 33,841 17,489 9,679 63,665 182,287
Amount.......................... $347,395 $508,727 $179,858 $107,442 $827,619 $182,287
-------- -------- -------- -------- -------- --------
Shares acquired:
Shares.......................... 12,139 4,146 1,752 1,501 8,255 166,614
Amount.......................... $280,833 $ 75,165 $ 18,637 $ 18,863 $124,553 $166,614
Shares received for reinvestment
of dividends:
Shares.......................... 1,444 1,589 966 445 3,329 6,355
Amount.......................... $ 36,269 $ 31,156 $ 10,214 $ 5,730 $ 52,334 $ 6,355
Shares redeemed:
Shares.......................... 8,521 8,715 2,914 3,386 12,305 264,962
Amount.......................... $171,034 $115,616 $ 28,318 $ 36,449 $149,611 $264,962
-------- -------- -------- -------- -------- --------
Net change:
Shares.......................... 5,062 (2,980) (196) (1,440) (721) (91,993)
Amount.......................... $146,068 ($ 9,295) $ 533 ($11,856) $ 27,276 ($91,993)
-------- -------- -------- -------- -------- --------
Shares end of year:
Shares.......................... 21,945 30,861 17,293 8,239 62,944 90,294
Amount.......................... $493,463 $499,432 $180,391 $ 95,586 $854,895 $ 90,294
======== ======== ======== ======== ======== ========
</TABLE>
F-32
<PAGE> 84
MONY AMERICA
VARIABLE ACCOUNT L
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
4. INVESTMENTS (CONTINUED)
Investments in Variable Universal Life at cost, at December 31, 1995
consist of the following:
<TABLE>
<CAPTION>
LONG
INTERMEDIATE TERM GOVERNMENT MONEY SMALL INTERNATIONAL
TERM BOND BOND SECURITIES MARKET EQUITY CAP MANAGED GROWTH
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
------------ --------- ---------- ---------- ---------- --------- ---------- -------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares beginning of
year:
Shares............. 0 0 0 0 0 0 0 0
Amount............. $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
------- -------- -------- ---------- ---------- -------- ---------- --------
Shares acquired:
Shares............. 3,719 21,651 18,234 9,989,307 51,815 40,031 262,958 82,905
Amount............. $40,447 $269,258 $186,778 $9,989,307 $1,158,096 $733,552 $7,126,057 $440,017
Shares received for
reinvestment of
dividends:
Shares............. 141 1,131 534 23,644 1,178 962 7,044 3,464
Amount............. $ 1,489 $ 14,565 $ 5,452 $ 23,644 $ 27,509 $ 17,779 $ 197,666 $ 18,775
Shares redeemed:
Shares............. 1,332 1,834 1,982 8,312,134 8,262 8,481 47,622 15,976
Amount............. $14,301 $ 22,288 $ 20,144 $8,312,134 $ 164,342 $146,441 $1,175,878 $ 79,266
------- -------- -------- ---------- ---------- -------- ---------- --------
Net change:
Shares............. 2,528 20,948 16,786 1,700,817 44,731 32,512 222,380 70,393
Amount............. $27,635 $261,535 $172,086 $1,700,817 $1,021,263 $604,890 $6,147,845 $379,526
------- -------- -------- ---------- ---------- -------- ---------- --------
Shares end of year:
Shares............. 2,528 20,948 16,786 1,700,817 44,731 32,512 222,380 70,393
Amount............. $27,635 $261,535 $172,086 $1,700,817 $1,021,263 $604,890 $6,147,845 $379,526
======= ======== ======== ========== ========== ======== ========== ========
<CAPTION>
HIGH YIELD
BOND
PORTFOLIO
----------
<S> <C>
Shares beginning of
year:
Shares............. 0
Amount............. $ 0
--------
Shares acquired:
Shares............. 86,158
Amount............. $456,470
Shares received for
reinvestment of
dividends:
Shares............. 1,515
Amount............. $ 8,030
Shares redeemed:
Shares............. 21,249
Amount............. $112,152
--------
Net change:
Shares............. 66,424
Amount............. $352,348
--------
Shares end of year:
Shares............. 66,424
Amount............. $352,348
========
</TABLE>
F-33
<PAGE> 85
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
VARIABLE LIFE
------------------------------------------------------------------------------
EQUITY EQUITY INTERMEDIATE LONG TERM MONEY
GROWTH INCOME TERM BOND BOND DIVERSIFIED MARKET
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------- ---------- ------------ ---------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Investments at cost (Note 4)..... $ 686,284 $ 602,981 $ 150,738 $ 60,737 $1,013,471 $ 71,379
========= ========= ========= ========= ========== =========
Investments in MONY Series Fund,
Inc. at net asset value (Note
2)............................. $ 804,042 $ 678,921 $ 161,147 $ 70,969 $1,059,414 $ 71,379
Amount due from MONY Series Fund,
Inc............................ 1,568 1,376 436 105 1,853 128
Amount due from MONY America..... 29 31 0 0 11 0
--------- --------- --------- --------- ---------- ---------
Total assets........... 805,639 680,328 161,583 71,074 1,061,278 71,507
--------- --------- --------- --------- ---------- ---------
LIABILITIES
Amount due to MONY Series Fund,
Inc. .......................... 29 31 0 0 11 0
Amount due to MONY America....... 1,568 1,376 436 105 1,853 128
--------- --------- --------- --------- ---------- ---------
Total liabilities...... 1,597 1,407 436 105 1,864 128
--------- --------- --------- --------- ---------- ---------
Net assets....................... $ 804,042 $ 678,921 $ 161,147 $ 70,969 $1,059,414 $ 71,379
========= ========= ========= ========= ========== =========
Net assets consist of:
Contractholders' net
payments.................... $ 537,053 $ 456,638 $ 194,729 $ 108,987 $ 858,922 $ 202,245
Cost of insurance withdrawals
(Note 3).................... (401,373) (514,693) (209,992) (163,972) (959,530) (210,567)
Undistributed net investment
income...................... 302,619 442,772 171,266 103,696 789,559 79,701
Accumulated net realized gain
(loss) on investments....... 247,985 218,264 (5,265) 12,026 324,520 0
Unrealized appreciation of
investments................. 117,758 75,940 10,409 10,232 45,943 0
--------- --------- --------- --------- ---------- ---------
Net assets....................... $ 804,042 $ 678,921 $ 161,147 $ 70,969 $1,059,414 $ 71,379
========= ========= ========= ========= ========== =========
Number of units outstanding*..... 14,175 12,020 6,407 2,108 25,623 3,841
--------- --------- --------- --------- ---------- ---------
Net asset value per unit
outstanding*................... $ 56.72 $ 56.48 $ 25.15 $ 33.67 $ 41.35 $ 18.59
========= ========= ========= ========= ========== =========
</TABLE>
- ---------------
* Units outstanding have been rounded for presentation purposes.
See notes to financial statements.
F-34
<PAGE> 86
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF ASSETS AND LIABILITIES (CONTINUED)
SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
VARIABLE UNIVERSAL LIFE
----------------------------------------------------------------------------------------------
INTERMEDIATE LONG TERM GOVERNMENT MONEY
TERM BOND BOND SECURITIES MARKET EQUITY SMALL CAP MANAGED
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------ ---------- ---------- ---------- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Investments at cost (Note 4)...... $404,400 $1,330,088 $ 579,124 $3,511,102 $24,506,129 $14,238,468 $ 78,279,338
======== ========== ========= ========== =========== =========== ============
Investments in Enterprise
Accumulation Trust at net asset
value (Note 2).................. $ 0 $ 0 $ 0 $ 0 $23,593,885 $12,883,085 $ 75,698,089
Investments in MONY Series Fund,
Inc. at net asset value (Note
2).............................. 416,375 1,431,998 600,395 3,511,102 0 0 0
Amount due from Enterprise
Accumulation Trust.............. 0 0 0 0 54,967 31,832 182,429
Amount due from MONY America...... 50 452 84 20,634 3,912 1,739 8,702
Amount due from MONY Series Fund,
Inc............................. 798 2,680 1,052 7,120 0 0 0
-------- ---------- --------- ---------- ----------- ----------- ------------
Total assets.............. 417,223 1,435,130 601,531 3,538,856 23,652,764 12,916,656 75,889,220
-------- ---------- --------- ---------- ----------- ----------- ------------
LIABILITIES
Amount due to Enterprise
Accumulation Trust.............. 0 0 0 0 3,912 1,739 8,702
Amount due to MONY America........ 798 2,680 1,052 7,120 54,967 31,832 182,429
Amount due to MONY Series Fund,
Inc. ........................... 50 452 84 20,634 0 0 0
-------- ---------- --------- ---------- ----------- ----------- ------------
Total liabilities......... 848 3,132 1,136 27,754 58,879 33,571 191,131
-------- ---------- --------- ---------- ----------- ----------- ------------
Net assets........................ $416,375 $1,431,998 $ 600,395 $3,511,102 $23,593,885 $12,883,085 $ 75,698,089
======== ========== ========= ========== =========== =========== ============
Net assets consist of:
Contractholders' net
payments.................... $457,136 $1,451,387 $ 676,420 $4,018,757 $27,523,699 $15,055,852 $ 85,804,797
Cost of insurance withdrawals
(Note 3).................... (74,006) (262,064) (141,595) (825,033) (5,374,912) (2,614,371) (17,118,852)
Undistributed net investment
income...................... 19,052 94,554 30,151 317,378 417,254 639,313 2,304,578
Accumulated net realized gain
on investments.............. 2,218 46,211 14,148 0 1,940,088 1,157,674 7,288,815
Unrealized appreciation
(depreciation) of
investments................. 11,975 101,910 21,271 0 (912,244) (1,355,383) (2,581,249)
-------- ---------- --------- ---------- ----------- ----------- ------------
Net assets........................ $416,375 $1,431,998 $ 600,395 $3,511,102 $23,593,885 $12,883,085 $ 75,698,089
======== ========== ========= ========== =========== =========== ============
Number of units outstanding*...... 32,759 96,027 48,306 299,351 1,219,453 756,121 3,899,284
-------- ---------- --------- ---------- ----------- ----------- ------------
Net asset value per unit
outstanding*.................... $ 12.71 $ 14.91 $ 12.43 $ 11.73 $ 19.35 $ 17.04 $ 19.41
======== ========== ========= ========== =========== =========== ============
<CAPTION>
VARIABLE UNIVERSAL LIFE
--------------------------
INTERNATIONAL HIGH YIELD
GROWTH BOND
SUBACCOUNT SUBACCOUNT
------------- ----------
<S> <C> <C>
ASSETS
Investments at cost (Note 4)...... $ 6,278,855 $3,130,735
=========== ==========
Investments in Enterprise
Accumulation Trust at net asset
value (Note 2).................. $ 5,750,540 $2,914,811
Investments in MONY Series Fund,
Inc. at net asset value (Note
2).............................. 0 0
Amount due from Enterprise
Accumulation Trust.............. 13,732 6,208
Amount due from MONY America...... 994 685
Amount due from MONY Series Fund,
Inc............................. 0 0
----------- ----------
Total assets.............. 5,765,266 2,921,704
----------- ----------
LIABILITIES
Amount due to Enterprise
Accumulation Trust.............. 994 685
Amount due to MONY America........ 13,732 6,208
Amount due to MONY Series Fund,
Inc. ........................... 0 0
----------- ----------
Total liabilities......... 14,726 6,893
----------- ----------
Net assets........................ $ 5,750,540 $2,914,811
=========== ==========
Net assets consist of:
Contractholders' net
payments.................... $ 7,235,689 $3,318,808
Cost of insurance withdrawals
(Note 3).................... (1,334,054) (583,426)
Undistributed net investment
income...................... 85,497 338,484
Accumulated net realized gain
on investments.............. 291,723 56,869
Unrealized appreciation
(depreciation) of
investments................. (528,315) (215,924)
----------- ----------
Net assets........................ $ 5,750,540 $2,914,811
=========== ==========
Number of units outstanding*...... 420,647 210,228
----------- ----------
Net asset value per unit
outstanding*.................... $ 13.67 $ 13.87
=========== ==========
</TABLE>
- ---------------
* Units outstanding have been rounded for presentation purposes.
See notes to financial statements.
F-35
<PAGE> 87
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
VARIABLE LIFE
------------------------------------------------------------------------------
EQUITY EQUITY INTERMEDIATE LONG TERM MONEY
GROWTH INCOME TERM BOND BOND DIVERSIFIED MARKET
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------- ---------- ------------ ---------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Dividend income.................... $ 138,442 $ 118,315 $ 8,132 $ 3,912 $ 261,166 $ 2,853
Mortality and expense risk charges
(Note 3)......................... (3,844) (3,301) (700) (311) (5,113) (328)
--------- --------- -------- ------- --------- --------
Net investment income.............. 134,598 115,014 7,432 3,601 256,053 2,525
--------- --------- -------- ------- --------- --------
Realized and unrealized gain on
investments (Note 2):
Proceeds from sales.............. 63,568 46,857 13,108 9,998 224,736 12,221
Cost of shares sold.............. (39,884) (29,780) (12,378) (8,781) (156,407) (12,221)
--------- --------- -------- ------- --------- --------
Net realized gain on investments... 23,684 17,077 730 1,217 68,329 0
Net increase (decrease) in
unrealized appreciation of
investments...................... (134,129) (142,306) 2,036 1,732 (258,625) 0
--------- --------- -------- ------- --------- --------
Net realized and unrealized gain
(loss) on investments............ (110,445) (125,229) 2,766 2,949 (190,296) 0
--------- --------- -------- ------- --------- --------
Net increase (decrease) in net
assets resulting from
operations....................... $ 24,153 $ (10,215) $ 10,198 $ 6,550 $ 65,757 $ 2,525
========= ========= ======== ======= ========= ========
</TABLE>
See notes to financial statements.
F-36
<PAGE> 88
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF OPERATIONS (CONTINUED)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
VARIABLE UNIVERSAL LIFE
---------------------------------------------------------------------------------
INTERMEDIATE LONG TERM GOVERNMENT MONEY
TERM BOND BOND SECURITIES MARKET EQUITY SMALL CAP
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------ ---------- ---------- ------------ ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Dividend income................................ $ 14,696 $ 53,185 $ 18,282 $ 110,663 $ 0 $ 0
Mortality and expense risk charges (Note 3).... (1,741) (5,938) (2,655) (15,876) (121,653) (66,520)
-------- --------- --------- ------------ ----------- -----------
Net investment income (loss)................... 12,955 47,247 15,627 94,787 (121,653) (66,520)
-------- --------- --------- ------------ ----------- -----------
Realized and unrealized gain on investments
(Note 2):
Proceeds from sales.......................... 71,248 384,910 199,981 17,087,430 4,376,999 2,740,183
Cost of shares sold.......................... (69,958) (346,944) (191,805) (17,087,430) (3,381,279) (1,965,588)
-------- --------- --------- ------------ ----------- -----------
Net realized gain on investments............... 1,290 37,966 8,176 0 995,720 774,595
Net increase (decrease) in unrealized
appreciation of investments.................. 6,715 23,909 4,933 0 (2,277,574) (1,997,929)
-------- --------- --------- ------------ ----------- -----------
Net realized and unrealized gain (loss) on
investments.................................. 8,005 61,875 13,109 0 (1,281,854) (1,223,334)
-------- --------- --------- ------------ ----------- -----------
Net increase (decrease) in net assets resulting
from operations.............................. $ 20,960 $ 109,122 $ 28,736 $ 94,787 $(1,403,507) $(1,289,854)
======== ========= ========= ============ =========== ===========
<CAPTION>
VARIABLE UNIVERSAL LIFE
----------------------------------------
INTERNATIONAL HIGH YIELD
MANAGED GROWTH BOND
SUBACCOUNT SUBACCOUNT SUBACCOUNT
----------- ------------- ----------
<S> <C> <C> <C>
Dividend income................................ $ 0 $ 0 $ 191,552
Mortality and expense risk charges (Note 3).... (415,043) (30,216) (14,005)
----------- ----------- ---------
Net investment income (loss)................... (415,043) (30,216) 177,547
----------- ----------- ---------
Realized and unrealized gain on investments
(Note 2):
Proceeds from sales.......................... 13,379,055 1,162,311 624,538
Cost of shares sold.......................... (9,833,610) (1,035,637) (603,970)
----------- ----------- ---------
Net realized gain on investments............... 3,545,445 126,674 20,568
Net increase (decrease) in unrealized
appreciation of investments.................. (7,948,631) (420,792) (254,680)
----------- ----------- ---------
Net realized and unrealized gain (loss) on
investments.................................. (4,403,186) (294,118) (234,112)
----------- ----------- ---------
Net increase (decrease) in net assets resulting
from operations.............................. $(4,818,229) $ (324,334) $ (56,565)
=========== =========== =========
</TABLE>
See notes to financial statements.
F-37
<PAGE> 89
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF CHANGES IN NET ASSETS (UNAUDITED)
<TABLE>
<CAPTION>
VARIABLE LIFE
---------------------------------------------------------------------------
EQUITY GROWTH EQUITY INCOME INTERMEDIATE TERM
SUBACCOUNT SUBACCOUNT BOND SUBACCOUNT
---------------------------- ---------------------------- -------------
FOR THE NINE FOR THE FOR THE NINE FOR THE FOR THE NINE
MONTHS ENDED YEAR ENDED MONTHS ENDED YEAR ENDED MONTHS ENDED
SEPTEMBER 30, DECEMBER 31, SEPTEMBER 30, DECEMBER 31, SEPTEMBER 30,
1998 1997 1998 1997 1998
------------- ------------ ------------- ------------ -------------
<S> <C> <C> <C> <C> <C>
From operations:
Net investment income................. $ 134,598 $ 53,040 $ 115,014 $ 76,627 $ 7,432
Net realized gain on investments...... 23,684 33,607 17,077 84,704 730
Net increase (decrease) in unrealized
appreciation of investments......... (134,129) 101,936 (142,306) 32,332 2,036
--------- -------- --------- --------- --------
Net increase (decrease) in net assets
resulting from operations............. 24,153 188,583 (10,215) 193,663 10,198
--------- -------- --------- --------- --------
From unit transactions:
Net proceeds from the issuance of
units............................... 39,908 35,646 22,666 39,172 6,721
Net asset value of units redeemed or
used to meet contract obligations... (58,153) (59,621) (39,190) (193,625) (12,309)
--------- -------- --------- --------- --------
Net decrease from unit transactions..... (18,245) (23,975) (16,524) (154,453) (5,588)
--------- -------- --------- --------- --------
Net increase (decrease) in net assets... 5,908 164,608 (26,739) 39,210 4,610
Net assets beginning of period.......... 798,134 633,526 705,660 666,450 156,537
--------- -------- --------- --------- --------
Net assets end of period*............... $ 804,042 $798,134 $ 678,921 $ 705,660 $161,147
========= ======== ========= ========= ========
Units outstanding beginning of period... 14,506 14,958 12,292 15,149 6,639
Units issued during the period.......... 674 747 383 783 280
Units redeemed during the period........ (1,005) (1,199) (655) (3,640) (512)
--------- -------- --------- --------- --------
Units outstanding end of period......... 14,175 14,506 12,020 12,292 6,407
========= ======== ========= ========= ========
- ---------------
* Includes undistributed net investment
income of: $ 302,619 $168,021 $ 442,772 $ 327,758 $171,266
<CAPTION>
VARIABLE LIFE
-----------------------------------------------------------------------------
INTERMEDIATE TERM
BOND SUBACCOUNT
--------------- ---------------------------- ----------------------------
FOR THE FOR THE NINE FOR THE FOR THE NINE FOR THE
YEAR ENDED MONTHS ENDED YEAR ENDED MONTHS ENDED YEAR ENDED
DECEMBER 31, SEPTEMBER 30, DECEMBER 31, SEPTEMBER 30, DECEMBER 31,
1997 1998 1997 1998 1997
------------ ------------- ------------ ------------- ------------
<S> <C> <C> <C> <C> <C>
From operations:
Net investment income................. $ 9,374 $ 3,601 $ 5,147 $ 256,053 $ 77,745
Net realized gain on investments...... 1,672 1,217 3,780 68,329 100,092
Net increase (decrease) in unrealized
appreciation of investments......... 288 1,732 649 (258,625) 59,772
-------- -------- -------- ---------- ----------
Net increase (decrease) in net assets
resulting from operations............. 11,334 6,550 9,576 65,757 237,609
-------- -------- -------- ---------- ----------
From unit transactions:
Net proceeds from the issuance of
units............................... 8,194 2,194 4,547 48,414 77,730
Net asset value of units redeemed or
used to meet contract obligations... (40,032) (9,330) (37,821) (165,920) (287,917)
-------- -------- -------- ---------- ----------
Net decrease from unit transactions..... (31,838) (7,136) (33,274) (117,506) (210,187)
-------- -------- -------- ---------- ----------
Net increase (decrease) in net assets... (20,504) (586) (23,698) (51,749) 27,422
Net assets beginning of period.......... 177,041 71,555 95,253 1,111,163 1,083,741
-------- -------- -------- ---------- ----------
Net assets end of period*............... $156,537 $ 70,969 $ 71,555 $1,059,414 $1,111,163
======== ======== ======== ========== ==========
Units outstanding beginning of period... 8,041 2,334 3,504 28,291 34,279
Units issued during the period.......... 362 70 165 1,158 2,219
Units redeemed during the period........ (1,764) (296) (1,335) (3,826) (8,207)
-------- -------- -------- ---------- ----------
Units outstanding end of period......... 6,639 2,108 2,334 25,623 28,291
======== ======== ======== ========== ==========
- ---------------
* Includes undistributed net investment
income of: $163,834 $103,696 $100,095 $ 789,559 $ 533,506
<CAPTION>
VARIABLE LIFE
----------------------------
MONEY MARKET
SUBACCOUNT
----------------------------
FOR THE NINE FOR THE
MONTHS ENDED YEAR ENDED
SEPTEMBER 30, DECEMBER 31,
1998 1997
------------- ------------
<S> <C> <C>
From operations:
Net investment income................. $ 2,525 $ 3,689
Net realized gain on investments...... 0 0
Net increase (decrease) in unrealized
appreciation of investments......... 0 0
-------- --------
Net increase (decrease) in net assets
resulting from operations............. 2,525 3,689
-------- --------
From unit transactions:
Net proceeds from the issuance of
units............................... 5,040 6,471
Net asset value of units redeemed or
used to meet contract obligations... (11,749) (19,886)
-------- --------
Net decrease from unit transactions..... (6,709) (13,415)
-------- --------
Net increase (decrease) in net assets... (4,184) (9,726)
Net assets beginning of period.......... 75,563 85,289
-------- --------
Net assets end of period*............... $ 71,379 $ 75,563
======== ========
Units outstanding beginning of period... 4,207 4,970
Units issued during the period.......... 277 368
Units redeemed during the period........ (643) (1,131)
-------- --------
Units outstanding end of period......... 3,841 4,207
======== ========
- ---------------
* Includes undistributed net investment
income of: $ 79,701 $ 77,176
</TABLE>
See notes to financial statements.
F-38
<PAGE> 90
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF CHANGES IN NET ASSETS (UNAUDITED) (CONTINUED)
<TABLE>
<CAPTION>
VARIABLE UNIVERSAL LIFE
-----------------------------------------------------------
INTERMEDIATE TERM LONG TERM
BOND SUBACCOUNT BOND SUBACCOUNT
---------------------------- ----------------------------
FOR THE NINE FOR THE FOR THE NINE FOR THE
MONTHS ENDED YEAR ENDED MONTHS ENDED YEAR ENDED
SEPTEMBER 30, DECEMBER 31, SEPTEMBER 30, DECEMBER 31,
1998 1997 1998 1997
------------- ------------ ------------- ------------
<S> <C> <C> <C> <C>
From operations:
Net investment income.......................... $ 12,955 $ 5,087 $ 47,247 $ 36,542
Net realized gain on investments............... 1,290 1,269 37,966 6,284
Net increase in unrealized appreciation of
investments.................................. 6,715 3,027 23,909 56,115
-------- -------- ---------- ---------
Net increase in net assets resulting from
operations..................................... 20,960 9,383 109,122 98,941
-------- -------- ---------- ---------
From unit transactions:
Net proceeds from the issuance of units........ 216,605 172,340 672,626 471,749
Net asset value of units redeemed or used to
meet contract obligations.................... (55,555) (38,182) (298,212) (236,759)
-------- -------- ---------- ---------
Net increase (decrease) from unit transactions... 161,050 134,158 374,414 234,990
-------- -------- ---------- ---------
Net increase (decrease) in net assets............ 182,010 143,541 483,536 333,931
Net assets beginning of period................... 234,365 90,824 948,462 614,531
-------- -------- ---------- ---------
Net assets end of period*........................ $416,375 $234,365 $1,431,998 $ 948,462
======== ======== ========== =========
Units outstanding beginning of period............ 19,650 8,138 69,779 50,910
Units issued during the period................... 17,637 14,831 47,552 37,613
Units redeemed during the period................. (4,528) (3,319) (21,304) (18,744)
-------- -------- ---------- ---------
Units outstanding end of period.................. 32,759 19,650 96,027 69,779
======== ======== ========== =========
- ---------------
* Includes undistributed net investment income
of: $ 19,052 $ 6,097 $ 94,554 $ 47,307
<CAPTION>
VARIABLE UNIVERSAL LIFE
-----------------------------------------------------------
GOVERNMENT MONEY MARKET
SECURITIES SUBACCOUNT SUBACCOUNT
---------------------------- ----------------------------
FOR THE NINE FOR THE FOR THE NINE FOR THE
MONTHS ENDED YEAR ENDED MONTHS ENDED YEAR ENDED
SEPTEMBER 30, DECEMBER 31, SEPTEMBER 30, DECEMBER 31,
1998 1997 1998 1997
------------- ------------ ------------- ------------
<S> <C> <C> <C> <C>
From operations:
Net investment income.......................... $ 15,627 $ 11,060 $ 94,787 $ 115,801
Net realized gain on investments............... 8,176 4,933 0 0
Net increase in unrealized appreciation of
investments.................................. 4,933 9,241 0 0
--------- --------- ------------ ------------
Net increase in net assets resulting from
operations..................................... 28,736 25,234 94,787 115,801
--------- --------- ------------ ------------
From unit transactions:
Net proceeds from the issuance of units........ 242,716 288,293 14,799,165 20,219,389
Net asset value of units redeemed or used to
meet contract obligations.................... (169,462) (107,779) (15,081,524) (20,985,756)
--------- --------- ------------ ------------
Net increase (decrease) from unit transactions... 73,254 180,514 (282,359) (766,367)
--------- --------- ------------ ------------
Net increase (decrease) in net assets............ 101,990 205,748 (187,572) (650,566)
Net assets beginning of period................... 498,405 292,657 3,698,674 4,349,240
--------- --------- ------------ ------------
Net assets end of period*........................ $ 600,395 $ 498,405 $ 3,511,102 $ 3,698,674
========= ========= ============ ============
Units outstanding beginning of period............ 42,420 26,498 325,979 400,565
Units issued during the period................... 20,152 25,322 1,281,390 1,818,649
Units redeemed during the period................. (14,266) (9,400) (1,308,018) (1,893,235)
--------- --------- ------------ ------------
Units outstanding end of period.................. 48,306 42,420 299,351 325,979
========= ========= ============ ============
- ---------------
* Includes undistributed net investment income
of: $ 30,151 $ 14,524 $ 317,378 $ 222,591
</TABLE>
See notes to financial statements.
F-39
<PAGE> 91
MONY AMERICA
VARIABLE ACCOUNT L
STATEMENTS OF CHANGES IN NET ASSETS (UNAUDITED) (CONTINUED)
<TABLE>
<CAPTION>
VARIABLE UNIVERSAL LIFE (CONTINUED)
---------------------------------------------------------------------------
EQUITY SMALL CAP MANAGED
SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------------------------- ---------------------------- -------------
FOR THE NINE FOR THE FOR THE NINE FOR THE FOR THE NINE
MONTHS ENDED YEAR ENDED MONTHS ENDED YEAR ENDED MONTHS ENDED
SEPTEMBER 30, DECEMBER 31, SEPTEMBER 30, DECEMBER 31, SEPTEMBER 30,
1998 1997 1998 1997 1998
------------- ------------ ------------- ------------ -------------
<S> <C> <C> <C> <C> <C>
From operations:
Net investment income (loss).................. $ (121,653) $ 467,545 $ (66,520) $ 660,447 $ (415,043)
Net realized gain on investments.............. 995,720 746,120 774,595 342,745 3,545,445
Net increase (decrease) in unrealized
appreciation of investments................. (2,277,574) 984,236 (1,997,929) 568,217 (7,948,631)
----------- ----------- ----------- ----------- ------------
Net increase (decrease) in net assets resulting
from operations............................... (1,403,507) 2,197,901 (1,289,854) 1,571,409 (4,818,229)
----------- ----------- ----------- ----------- ------------
From unit transactions:
Net proceeds from the issuance of units....... 12,355,204 11,812,002 8,172,821 5,248,401 32,300,890
Net asset value of units redeemed or used to
meet contract obligations................... (3,840,610) (2,656,849) (2,184,607) (1,072,152) (11,853,573)
----------- ----------- ----------- ----------- ------------
Net increase from unit transactions............. 8,514,594 9,155,153 5,988,214 4,176,249 20,447,317
----------- ----------- ----------- ----------- ------------
Net increase in net assets...................... 7,111,087 11,353,054 4,698,360 5,747,658 15,629,088
Net assets beginning of period.................. 16,482,798 5,129,744 8,184,725 2,437,067 60,069,001
----------- ----------- ----------- ----------- ------------
Net assets end of period*....................... $23,593,885 $16,482,798 $12,883,085 $ 8,184,725 $ 75,698,089
=========== =========== =========== =========== ============
Units outstanding beginning of period........... 821,090 319,002 449,403 191,743 2,954,670
Units issued during the period.................. 580,123 647,931 421,335 326,703 1,503,017
Units redeemed during the period................ (181,760) (145,843) (114,617) (69,043) (558,403)
----------- ----------- ----------- ----------- ------------
Units outstanding end of period................. 1,219,453 821,090 756,121 449,403 3,899,284
=========== =========== =========== =========== ============
- ---------------
* Includes undistributed net investment income
of: $ 417,254 $ 538,907 $ 639,313 $ 705,833 $ 2,304,578
<CAPTION>
VARIABLE UNIVERSAL LIFE (CONTINUED)
--------------------------------------------------------------------------
MANAGED INTERNATIONAL HIGH YIELD
SUBACCOUNT GROWTH SUBACCOUNT BOND SUBACCOUNT
------------ ---------------------------- ----------------------------
FOR THE FOR THE NINE FOR THE FOR THE NINE FOR THE
YEAR ENDED MONTHS ENDED YEAR ENDED MONTHS ENDED YEAR ENDED
DECEMBER 31, SEPTEMBER 30, DECEMBER 31, SEPTEMBER 30, DECEMBER 31,
1997 1998 1997 1998 1997
------------ ------------- ------------ ------------- ------------
<S> <C> <C> <C> <C> <C>
From operations:
Net investment income (loss).................. $ 2,400,789 $ (30,216) $ 98,833 $ 177,547 $ 111,190
Net realized gain on investments.............. 2,836,432 126,674 135,511 20,568 35,931
Net increase (decrease) in unrealized
appreciation of investments................. 3,108,829 (420,792) (204,105) (254,680) 12,532
----------- ----------- ---------- ---------- ----------
Net increase (decrease) in net assets resulting
from operations............................... 8,346,050 (324,334) 30,239 (56,565) 159,653
----------- ----------- ---------- ---------- ----------
From unit transactions:
Net proceeds from the issuance of units....... 36,238,986 3,001,090 3,034,936 1,486,600 1,268,282
Net asset value of units redeemed or used to
meet contract obligations................... (9,726,108) (1,005,470) (717,365) (454,943) (319,664)
----------- ----------- ---------- ---------- ----------
Net increase from unit transactions............. 26,512,878 1,995,620 2,317,571 1,031,657 948,618
----------- ----------- ---------- ---------- ----------
Net increase in net assets...................... 34,858,928 1,671,286 2,347,810 975,092 1,108,271
Net assets beginning of period.................. 25,210,073 4,079,254 1,731,444 1,939,719 831,448
----------- ----------- ---------- ---------- ----------
Net assets end of period*....................... $60,069,001 $ 5,750,540 $4,079,254 $2,914,811 $1,939,719
=========== =========== ========== ========== ==========
Units outstanding beginning of period........... 1,532,486 290,466 128,820 138,275 66,709
Units issued during the period.................. 1,945,611 197,371 211,751 103,617 95,695
Units redeemed during the period................ (523,427) (67,190) (50,105) (31,664) (24,129)
----------- ----------- ---------- ---------- ----------
Units outstanding end of period................. 2,954,670 420,647 290,466 210,228 138,275
=========== =========== ========== ========== ==========
- ---------------
* Includes undistributed net investment income
of: $ 2,719,621 $ 85,497 $ 115,713 $ 338,484 $ 160,937
</TABLE>
See notes to financial statements.
F-40
<PAGE> 92
MONY AMERICA
VARIABLE ACCOUNT L
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION AND BUSINESS
MONY America Variable Account L (the "Variable Account") is a separate
investment account established on February 19, 1985 by MONY Life Insurance
Company of America ("MONY America"), under the laws of the State of Arizona.
The Variable Account operates as a unit investment trust under the
Investment Company Act of 1940 (the "1940 Act"). The Variable Account holds
assets that are segregated from all of MONY America's other assets and, at
present, is used to support Flexible Premium Variable Life Insurance policies,
which include Variable Life Insurance (Strategist), Variable Universal Life
(MONYEquity Master) and Corporate Sponsored Variable Life Insurance policies.
These policies are issued by MONY America, which is a wholly-owned subsidiary of
The Mutual Life Insurance Company of New York ("MONY"). For presentation
purposes, the information related to the Variable Life and Variable Universal
Life Insurance policies are presented here.
There are currently six Variable Life Subaccounts and nine Variable
Universal Life Subaccounts within the Variable Account, each invests only in a
corresponding portfolio of the MONY Series Fund, Inc. (the "Fund") or the
Enterprise Accumulation Trust ("Enterprise") (collectively, the "Funds"). The
subaccounts of the Variable Universal Life commenced operations during 1995. The
Funds are registered under the 1940 Act as open end, diversified, management
investment companies.
2. SIGNIFICANT ACCOUNTING POLICIES
Investment:
The investment in shares of each of the respective portfolios is stated at
value which is the net asset values of the Funds. Except for the Money Market
Portfolios, net asset values are based upon market quotations of the securities
held in each of the corresponding portfolios of the Funds. For the Money Market
Portfolios, the net asset values are based on amortized cost of the securities
held which approximates value.
Taxes:
MONY America is currently taxed as a life insurance company and will
include the Variable Account's operations in its tax return. MONY America does
not expect, based on current tax law, to incur any income tax burden upon the
earnings or realized capital gains attributable to the Variable Account. Based
on this expectation, no charges are currently being deducted from the Variable
Account for federal income tax purposes.
3. RELATED PARTY TRANSACTIONS
MONY America is the legal owner of the assets held by the Variable Account.
Policy premiums received from MONY America by the Variable Account
represent gross policy premiums recorded by MONY America less deductions
retained as compensation for certain sales distribution expenses and premium
taxes.
The cost of insurance, administration charges, and, if applicable, the cost
of any optional benefits added by riders are deducted on each monthly date from
the cash value of the contract to compensate MONY America. These deductions are
treated as contractholder redemptions by the Variable Account. The amount
deducted for the Variable Life and Variable Universal Subaccounts for 1998
aggregated $11,825,051.
MONY America receives from the Variable Account the amounts deducted for
mortality and expense risks at an annual rate of .60 percent (for the Variable
Life Subaccounts) and .75 percent (for the Variable
F-41
<PAGE> 93
MONY AMERICA
VARIABLE ACCOUNT L
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
3. RELATED PARTY TRANSACTIONS (CONTINUED)
Universal Life Subaccounts) of aggregate average daily net assets. As investment
adviser to the Fund, it receives amounts paid by the Fund for those services.
Enterprise Capital Management, Inc., a wholly-owned subsidiary of MONY,
acts as investment adviser to Enterprise, and it receives amounts paid by
Enterprise for those services.
4. INVESTMENTS
Investments in Variable Life at cost, at September 30, 1998 (unaudited)
consist of the following:
<TABLE>
<CAPTION>
MONY SERIES FUND, INC.
--------------------------------------------------------------------------
EQUITY EQUITY INTERMEDIATE LONG TERM MONEY
GROWTH INCOME TERM BOND BOND DIVERSIFIED MARKET
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- --------- ------------ --------- ----------- ---------
<S> <C> <C> <C> <C> <C> <C>
Shares beginning of period:
Shares........................ 22,121 26,039 14,077 5,245 53,914 75,563
Amount........................ $546,247 $487,414 $148,164 $63,055 $ 806,595 $ 75,563
-------- -------- -------- ------- ---------- --------
Shares acquired:
Shares........................ 1,206 1,047 616 189 5,393 5,184
Amount........................ $ 41,479 $ 27,032 $ 6,820 $ 2,551 $ 102,117 $ 5,184
Shares received for reinvestment
of dividends:
Shares........................ 4,089 4,582 759 300 14,780 2,853
Amount........................ $138,442 $118,315 $ 8,132 $ 3,912 $ 261,166 $ 2,853
Shares redeemed:
Shares........................ (1,915) (1,852) (1,191) (736) (11,842) (12,221)
Amount........................ $(39,884) $(29,780) $(12,378) $(8,781) $ (156,407) $(12,221)
-------- -------- -------- ------- ---------- --------
Net change:
Shares........................ 3,380 3,777 184 (247) 8,331 (4,184)
Amount........................ $140,037 $115,567 $ 2,574 $(2,318) $ 206,876 $ (4,184)
-------- -------- -------- ------- ---------- --------
Shares end of period:
Shares........................ 25,501 29,816 14,261 4,998 62,245 71,379
Amount........................ $686,284 $602,981 $150,738 $60,737 $1,013,471 $ 71,379
======== ======== ======== ======= ========== ========
</TABLE>
F-42
<PAGE> 94
MONY AMERICA
VARIABLE ACCOUNT L
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
4. INVESTMENTS (CONTINUED)
Investments in Variable Universal Life at cost, at September 30, 1998
(unaudited) consist of the following:
<TABLE>
<CAPTION>
MONY SERIES FUND, INC.
-----------------------------------------------------
INTERMEDIATE LONG
TERM TERM GOVERNMENT MONEY
BOND BOND SECURITIES MARKET
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
------------ ---------- ---------- ------------
<S> <C> <C> <C> <C>
Shares beginning of period:
Shares...................... 21,076 69,535 45,767 3,698,674
Amount...................... $229,105 $ 870,461 $ 482,067 $ 3,698,674
-------- ---------- --------- ------------
Shares acquired:
Shares...................... 20,844 55,340 24,907 16,789,195
Amount...................... $230,557 $ 753,386 $ 270,580 $ 16,789,195
Shares received for
reinvestment of dividends:
Shares...................... 1,372 4,085 1,728 110,663
Amount...................... $ 14,696 $ 53,185 $ 18,282 $ 110,663
Shares redeemed:
Shares...................... (6,445) (28,115) (18,410) (17,087,430)
Amount...................... $(69,958) $ (346,944) $(191,805) $(17,087,430)
-------- ---------- --------- ------------
Net change:
Shares...................... 15,771 31,310 8,225 (187,572)
Amount...................... $175,295 $ 459,627 $ 97,057 $ (187,572)
-------- ---------- --------- ------------
Shares end of period:
Shares...................... 36,847 100,845 53,992 3,511,102
Amount...................... $404,400 $1,330,088 $ 579,124 $ 3,511,102
======== ========== ========= ============
<CAPTION>
ENTERPRISE ACCUMULATION TRUST
--------------------------------------------------------------------
HIGH
INTERNATIONAL YIELD
EQUITY SMALL CAP MANAGED GROWTH BOND
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------- ----------- ----------- ------------- ----------
<S> <C> <C> <C> <C> <C>
Shares beginning of period:
Shares...................... 469,730 306,544 1,473,001 660,074 339,706
Amount...................... $15,117,468 $ 7,542,179 $54,701,619 $ 4,186,777 $1,900,963
----------- ----------- ----------- ----------- ----------
Shares acquired:
Shares...................... 341,930 303,584 772,045 466,370 289,839
Amount...................... $12,769,940 $ 8,661,877 $33,411,329 $ 3,127,715 $1,642,190
Shares received for
reinvestment of dividends:
Shares...................... 0 0 0 0 33,537
Amount...................... $ 0 $ 0 $ 0 $ 0 $ 191,552
Shares redeemed:
Shares...................... (117,925) (97,266) (312,000) (175,941) (109,987)
Amount...................... $(3,381,279) $(1,965,588) $(9,833,610) $(1,035,637) $ (603,970)
----------- ----------- ----------- ----------- ----------
Net change:
Shares...................... 224,005 206,318 460,045 290,429 213,389
Amount...................... $ 9,388,661 $ 6,696,289 $23,577,719 $ 2,092,078 $1,229,772
----------- ----------- ----------- ----------- ----------
Shares end of period:
Shares...................... 693,735 512,862 1,933,046 950,503 553,095
Amount...................... $24,506,129 $14,238,468 $78,279,338 $ 6,278,855 $3,130,735
=========== =========== =========== =========== ==========
</TABLE>
F-43
<PAGE> 95
REPORT OF INDEPENDENT ACCOUNTANTS
TO THE BOARD OF DIRECTORS OF
MONY LIFE INSURANCE COMPANY OF AMERICA:
We have audited the accompanying statutory statements of admitted assets,
liabilities, capital and surplus of MONY Life Insurance Company of America ("the
Company") as of December 31, 1997 and 1996, and the related statutory statements
of operations, capital and surplus, and cash flows for the years then ended.
These statutory financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
The Company presents its financial statements in conformity with the
accounting practices prescribed or permitted by the Insurance Department of the
State of Arizona ("statutory"), which is a comprehensive basis of accounting
other than generally accepted accounting principles ("GAAP"). As explained in
Note 2 to the financial statements, the accounting practices used by the Company
vary from generally accepted accounting principles, and the effects of these
variances are material.
In our opinion, because of the effects of the matter discussed in the
preceding paragraph, the statutory financial statements referred to above do not
present fairly, in conformity with GAAP, the financial position of the Company
as of December 31, 1997 and 1996, or the results of its operations and its cash
flows, for the years then ended.
In our opinion, however, the statutory financial statements referred to
above present fairly, in all material respects, the admitted assets,
liabilities, capital and surplus of the Company as of December 31, 1997 and
1996, and the results of its operations and its cash flows for the years then
ended on the basis of accounting described in Note 2.
Our audits were conducted for the purpose of expressing an opinion on the
financial statements taken as a whole. The Supplemental Schedule of Selected
Financial Data is presented to comply with the National Association of Insurance
Commissioners' Annual Statement Instructions and is not a required part of the
basic financial statements. The Supplemental Schedule of Selected Financial Data
has been subjected to the auditing procedures applied in the audits of the basic
financial statements and, in our opinion, is fairly stated, in all material
respects, in relation to the basic financial statements taken as a whole.
COOPERS & LYBRAND L.L.P.
New York, New York
February 27, 1998
F-44
<PAGE> 96
MONY LIFE INSURANCE COMPANY OF AMERICA
STATEMENTS OF ADMITTED ASSETS, LIABILITIES, CAPITAL
AND SURPLUS -- STATUTORY BASIS
(IN THOUSANDS)
<TABLE>
<CAPTION>
DECEMBER 31,
-----------------------
1997 1996
---- ----
<S> <C> <C>
ASSETS
Cash and invested assets:
Cash and short-term investments........................ $ 45,956 $ 90,207
Bonds.................................................. 1,074,724 1,047,957
Common stocks.......................................... 981 1,235
Mortgage loans......................................... 134,828 158,847
Real estate............................................ 22,627 40,725
Policy loans........................................... 45,892 41,464
Other invested assets.................................. 7,001 8,518
---------- ----------
Total cash and invested assets.................... 1,332,009 1,388,953
Investment income due and accrued........................... 22,402 20,401
Other assets................................................ 247 2,511
Separate account assets..................................... 3,606,711 2,529,992
---------- ----------
Total assets...................................... $4,961,369 $3,941,857
========== ==========
LIABILITIES, CAPITAL AND SURPLUS
Liabilities:
Life insurance and annuity reserves.................... $1,241,979 $1,284,529
Deposits left with the Company......................... 23,197 23,525
Policy claims in process of settlement................. 8,331 6,085
Federal income taxes due or accrued.................... 17,837 29,077
Transfers from separate accounts....................... (128,943) (97,477)
Other liabilities...................................... 32,869 18,842
Separate account liabilities........................... 3,606,711 2,529,992
Interest maintenance reserve........................... 3,965 3,583
Investment reserves.................................... 6,000 4,000
Asset valuation reserve................................ 16,272 17,887
---------- ----------
Total liabilities................................. 4,828,218 3,820,043
Capital and surplus:
Capital stock, $1.00 par value; authorized, 5,000,000
shares issued and outstanding, 2,500,000 shares....... 2,500 2,500
Additional paid-in capital............................. 133,500 133,500
Unassigned funds....................................... (2,849) (14,186)
---------- ----------
Total capital and surplus......................... 133,151 121,814
---------- ----------
Total liabilities, capital and surplus............ $4,961,369 $3,941,857
========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-45
<PAGE> 97
MONY LIFE INSURANCE COMPANY OF AMERICA
STATEMENTS OF OPERATIONS -- STATUTORY BASIS
(IN THOUSANDS)
<TABLE>
<CAPTION>
FOR THE YEARS ENDED
DECEMBER 31,
--------------------
1997 1996
---- ----
<S> <C> <C>
Premiums, annuity considerations and fund deposits.......... $799,035 $741,870
Net investment income....................................... 99,006 102,092
Other income (net).......................................... 332 22
-------- --------
898,373 843,984
Policyholder and contractholder benefits.................... 407,381 336,731
Change in policy and contract reserves...................... (42,879) (35,010)
Commissions................................................. 40,860 36,793
Operating expenses.......................................... 64,866 53,212
Transfer to separate accounts............................... 397,492 428,101
-------- --------
867,720 819,827
Net gain from operations before federal income taxes........ 30,653 24,157
Federal income taxes........................................ 17,390 14,407
-------- --------
Net gain from operations.................................... 13,263 9,750
Net realized capital losses (See Note 7).................. (3,544) (1,720)
-------- --------
Net Income.................................................. $ 9,719 $ 8,030
======== ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-46
<PAGE> 98
MONY LIFE INSURANCE COMPANY OF AMERICA
STATEMENTS OF CAPITAL AND SURPLUS -- STATUTORY BASIS
(IN THOUSANDS)
<TABLE>
<CAPTION>
FOR THE YEARS ENDED
DECEMBER 31,
--------------------
1997 1996
---- ----
<S> <C> <C>
Capital and surplus, beginning of year...................... $121,814 $115,630
-------- --------
Net income.................................................. 9,719 8,030
Change in net unrealized capital gains...................... 2,774 1,618
Change in non-admitted assets............................... (771) 384
Change in asset valuation reserve........................... 1,615 (3,848)
Increase in investment reserve.............................. (2,000) 0
-------- --------
Net change in capital and surplus for the year.............. 11,337 6,184
-------- --------
Capital and surplus, end of year............................ $133,151 $121,814
======== ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-47
<PAGE> 99
MONY LIFE INSURANCE COMPANY OF AMERICA
STATEMENTS OF CASH FLOWS -- STATUTORY BASIS
(IN THOUSANDS)
<TABLE>
<CAPTION>
FOR THE YEARS ENDED
DECEMBER 31,
----------------------
1997 1996
---- ----
<S> <C> <C>
CASH FROM OPERATIONS:
Premiums, annuity considerations and fund deposits..... $ 799,751 $ 741,905
Investment income, net of investment expenses.......... 97,589 104,606
Other income........................................... 833 985
Policy benefits paid................................... (405,289) (336,206)
Transfers to separate accounts......................... (428,958) (460,502)
Commissions, other expenses and taxes paid............. (105,188) (91,150)
Federal income taxes (excluding tax on capital
gains)................................................ (27,516) 0
--------- ---------
Net cash from operations..................... (68,778) (40,362)
--------- ---------
CASH FROM INVESTMENTS:
Proceeds from investments sold, matured or repaid:
Bonds............................................. 130,649 134,846
Stocks............................................ 1,050 0
Mortgage loans.................................... 37,670 53,226
Real estate....................................... 18,453 19,790
Other invested assets............................. 1,512 18
Other............................................. 361 88
Taxes paid on net capital gains................... (1,564) 0
--------- ---------
Total investment proceeds.................... 188,131 207,968
--------- ---------
Cost of investments acquired:
Bonds............................................. 157,583 163,792
Stocks............................................ 68 40
Mortgage loans.................................... 13,641 38,651
Real estate....................................... 1,180 3,392
Other invested assets............................. 574 1,388
Change in policy loans............................ 4,428 3,339
--------- ---------
Total investments acquired................... 177,474 210,602
--------- ---------
Net cash from investments.................... 10,657 (2,634)
--------- ---------
CASH FROM FINANCING AND MISCELLANEOUS SOURCES:
Cash provided:
Other sources..................................... 13,870 8,041
--------- ---------
Net cash from financing and miscellaneous
sources.................................... 13,870 8,041
--------- ---------
Net change in cash and short-term investments.......... (44,251) (34,955)
Cash and short-term investments, beginning of year.......... 90,207 125,162
--------- ---------
Cash and short-term investments, end of year................ $ 45,956 $ 90,207
========= =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-48
<PAGE> 100
MONY LIFE INSURANCE COMPANY OF AMERICA
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION:
MONY Life Insurance Company of America (the "Company"), an Arizona
corporation, is a wholly owned subsidiary of The Mutual Life Insurance Company
of New York ("MONY"), a mutual life insurance company. The Company's primary
business is to provide interest-sensitive life insurance and asset accumulation
products to business owners, growing families, and pre-retirees. The Company's
insurance and financial products are marketed and distributed directly to
individuals primarily through MONY's career agency sales force. These products
are sold throughout the United States (except New York) and Puerto Rico.
On September 8, 1997, MONY announced that it is pursuing converting to a
stock life insurance company through demutualization. In connection with the
demutualization, MONY has prepared a Plan of Reorganization ("the Plan") which
is subject to approval by the Insurance Department of the State of New York as
well as adoption by MONY's Board of Trustees and approval by MONY's
policyholders.
In accordance with the Plan, subject to the approvals indicated above,
among other things, MONY will convert from a New York mutual life insurance
company to a New York stock life insurance company (the "Plan of
Demutualization") and become a wholly owned subsidiary of MONY Financial
Services Corporation (the "Holding Company"), a holding company organized in
Delaware for the purpose of becoming the parent holding company of MONY.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
The accompanying statutory financial statements have been prepared in
conformity with accounting practices prescribed or permitted by the Insurance
Department of the State of Arizona ("statutory"), which is a comprehensive basis
of accounting other than generally accepted accounting principles ("GAAP").
The preparation of statutory financial statements requires management to
make estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of results of operations and
changes in surplus during the reporting period. Actual results could differ
significantly from those estimates. The most significant estimates made in
conjunction with the preparation of the Company's financial statements include
those used in determining (i) valuation reserves for mortgage loans and real
estate investments, and (ii) the liability for future policy benefits.
In financial statements prepared in conformity with statutory accounting,
the accounting treatment of certain items is different than for financial
statements prepared in conformity with GAAP. Some of the general differences
include:
- Policy acquisition costs, such as commissions and other costs incurred
in connection with acquiring new and renewal business, are expensed when
incurred; under GAAP, such costs are deferred and amortized over the
present value of expected gross margins.
- Premiums for universal life and investment-type products are recognized
as revenue when due; under GAAP, they are reported as deposits to
policyholders' account balances. Revenues from these contracts under
GAAP consist of amounts assessed during the period against
policyholders' account balances for mortality, policy administration and
surrender charges.
- Policy reserves are based on statutory mortality and interest
requirements, without consideration of withdrawals, and are reported net
of reinsurance reserve credits; under GAAP, the reserves for interest
sensitive life and annuity products are equal to the fund value and are
reported gross of reinsurance reserve credits.
F-49
<PAGE> 101
MONY LIFE INSURANCE COMPANY OF AMERICA
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
- No provision is made for deferred income taxes; under GAAP, deferred
income taxes result from temporary differences between the tax bases of
assets and liabilities and their reported amounts in the financial
statements.
- An interest maintenance reserve ("IMR") is established as a liability to
capture realized investment gains and losses, net of tax, on the sale of
fixed maturities and mortgage loans resulting from changes in the
general level of interest rates, and is amortized into income over the
remaining years to expected maturity of the assets sold; under GAAP,
assets are carried on the balance sheet, net of appropriate valuation
allowances.
- An asset valuation reserve ("AVR"), based upon a formula prescribed by
the NAIC, is established as a liability to offset potential non-interest
related investment losses, and changes in the AVR are charged or
credited to surplus; under GAAP, no such reserve is required.
- Bonds in good standing are generally carried at amortized cost; under
GAAP, bonds which are classified as available for sale are carried at
fair value and the related change in unrealized gains and losses, net of
related deferred taxes and an adjustment for deferred policy acquisition
costs, is reported as a component of other comprehensive income in
equity.
- Certain assets designated as "non-admitted," are excluded from assets by
a direct charge to surplus; under GAAP, such assets are carried on the
balance sheet, net of appropriate valuation allowances.
- Methods used for calculating real estate and mortgage loan values and
real estate depreciation under statutory reporting are different from
those used for GAAP.
- Cash equivalents are defined as all highly liquid debt securities with
original maturities of twelve months or less; under GAAP, cash
equivalents are defined as short-term, highly liquid investments, which
generally have original maturities of three months or less.
The following is a description of the Company's principal statutory
accounting policies:
a. Premiums and Insurance Expenses
Premiums are included in revenue over the premium payment periods of the
related policies. Annuity considerations and fund deposits are included in
revenue as received.
The costs of acquiring new business, primarily commissions, underwriting,
agency and other costs related to issuance, maintenance and settlement of
policies are charged to operations in the year incurred.
b. Investments
Bonds are stated at amortized cost, except those bonds not in good
standing, which are carried at NAIC-designated values, which approximate fair
value. Loan-backed bonds and structured securities are valued at amortized cost
using the effective interest method considering anticipated prepayments at the
date of purchase; significant changes in the estimated cash flows from the
original purchase assumptions are accounted for using the retrospective method.
Common stocks are carried at fair value. Policy loans are carried at their
unpaid principal balances. Short-term investments are carried at amortized cost
and consist of securities with original maturities of twelve months or less.
Mortgage loans other than those in process of foreclosure are carried at
their unpaid principal balances adjusted for unamortized premium or discount.
Real estate owned for investment is carried at depreciated cost, less
encumbrances, if any. There were no encumbrances in 1997 or 1996. Joint ventures
in real estate are
F-50
<PAGE> 102
MONY LIFE INSURANCE COMPANY OF AMERICA
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
included in Other Invested Assets and are carried principally at their equity
value. Other investments are generally carried at cost.
Real estate acquired through foreclosure is carried at the lower of cost,
less accumulated depreciation and encumbrances, if any, or estimated fair value
at the time of foreclosure. There were no encumbrances in 1997 or 1996. Mortgage
loans in process of foreclosure are carried at the lower of the current carrying
value or estimated fair value. Fair value is determined by using the estimated
discounted cash flows expected from the underlying real estate properties. These
projected cash flows are based on estimates regarding future operating expenses,
lease rates, occupancy levels and investors' targeted yields.
The Company provides, through a direct charge to surplus, an investment
valuation reserve for permanent impairment of real estate investments, joint
ventures in real estate, mortgage loans delinquent for more than 60 days and
restructured mortgage loans. This reserve reflects, in part, the excess of the
carrying value of such assets over the estimated undiscounted cash flows
expected from the underlying real estate properties. These projected cash flows
are based on estimates similar to those described in the preceding paragraph. As
of December 31, 1997 and 1996, the Company's investment valuation reserve was $6
million and $4 million, respectively.
Derivative instruments are valued consistently with the items being hedged.
Hedges of fixed income assets and/or liabilities are valued at amortized cost.
Derivatives that cease to be effective hedges are valued at market value.
Realized capital gains and losses on sales of investments are determined on
the basis of specific identification. Unrealized capital gains and losses are
recorded directly to surplus. Investment income is recognized as earned.
Investment income earned includes the amortization of premium and accretion of
discount relative to bonds acquired at other than their par value and excludes
certain overdue due and accrued interest income.
c. Interest Maintenance Reserve and Asset Valuation Reserve
Realized investment gains and losses (net of tax) for bonds and mortgage
loans resulting from changes in interest rates are deferred, and credited or
charged to the IMR. These amounts are amortized into net income over the
remaining years to expected maturity of the assets sold.
The AVR is based upon a formula prescribed by the NAIC and functions as a
reserve for potential non-interest related investment losses. In addition,
realized investment gains and losses (not subject to the IMR) and unrealized
gains and losses result in changes in the AVR which are recorded directly to
surplus.
d. Policy Reserves
Policy reserves for deferred annuity contracts are computed by using the
Commissioners' Annuity Reserve Valuation Method by using the 1971 IAM Table for
contracts issued before 1984 and the 1983 Table A for contracts issued since
1983 and prescribed statutory interest rates. Policy reserves for universal life
and single premium whole life contracts are computed by using the Commissioners'
Reserve Valuation Method and by using the 1958 and 1980 CSO Tables, and
prescribed statutory interest rates.
e. Non-admitted Assets
Certain assets designated as "non-admitted" assets (principally
miscellaneous receivables) are excluded from the statements of admitted assets,
liabilities, capital and surplus.
F-51
<PAGE> 103
MONY LIFE INSURANCE COMPANY OF AMERICA
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
f. Separate Account Assets and Liabilities
Separate account assets and liabilities represent primarily segregated
funds administered and invested by the Company for the benefit of certain
contractholders. Assets consist of securities reported at market value.
Premiums, benefits and expenses of the separate accounts are included in the
Company's statements of operations.
g. Depreciation
The Company uses the constant-yield method of depreciation for
substantially all investments in real estate and real estate joint ventures and
limited partnerships acquired prior to January 1, 1991. Acquisitions subsequent
to January 1, 1991 and foreclosed real estate are depreciated on the
straight-line method. Real estate assets and improvements are generally
depreciated over ten to forty-year periods and leasehold improvements are
depreciated over the lives of the leases. Depreciation expense related to
investments in real estate was $1.1 million and $1.4 million in 1997 and 1996,
respectively; accumulated depreciation was $4.4 million at December 31, 1997 and
1996.
h. Cash Flows
Short-term investments are characterized as cash equivalents for purposes
of the statements of cash flows.
Certain amounts for 1996 have been reclassified to conform to the 1997
presentation.
3. CAPITAL AND SURPLUS:
MONY guaranteed to the states who requested it, pursuant to conditions
imposed by such states as a prerequisite for the licensing of new subsidiaries,
that the Company's capital and surplus would be maintained at a level at least
equivalent to the minimum capital and surplus required for admission to conduct
business in those states. As of December 31, 1997 and 1996, this guarantee was
outstanding in the state of New Jersey.
4. RELATED PARTY TRANSACTIONS:
At both December 31, 1997 and 1996, approximately 26 percent of the
Company's investments in mortgages were held through joint participation with
MONY. In addition, approximately 100 percent and 87 percent of the Company's
real estate and joint venture investments were held through joint participation
with MONY at December 31, 1997 and 1996, respectively.
In 1997 the New York City Industrial Development Agency issued bonds in the
total amount of $16.0 million for the benefit of MONY related to MONY's
consolidation of site locations to New York City. Debt service under the bonds
is funded by lease payments by MONY to the bond trustee for the benefit of the
Company, which is the sole bondholder. The bonds are listed as affiliated bonds
on Schedule D.
The Company and MONY are parties to an agreement whereby MONY agrees to
reimburse the Company to the extent that the Company's recognized loss as a
result of mortgage loan default or foreclosure or subsequent sale of the
underlying collateral exceeds 75 percent of the appraised value of the loan at
origination for each such mortgage loan. Pursuant to the agreement, the Company
received payments from MONY totaling $0.1 million in both 1997 and 1996.
The Company has a service agreements with MONY whereby MONY provides
personnel services, facilities, supplies and equipment to the Company to conduct
its business as well as for the Company to
F-52
<PAGE> 104
MONY LIFE INSURANCE COMPANY OF AMERICA
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
4. RELATED PARTY TRANSACTIONS (CONTINUED):
provide services to MONY Series Fund, Inc. ("the Fund"), an affiliate of the
Company, as an investment advisor. Services rendered by MONY under these
agreements are provided on a cost reimbursable basis.
The Company has an investment advisory agreement with the Fund with respect
to the investment and management of the Fund's invested assets. The Company is
compensated for such services with an investment management fee computed in
accordance with the terms of the agreement.
The Company has three underwriting agreements with the Fund and MONY
Securities Corporation ("MSC"). The agreements provide for MSC to act as the
principal underwriter for the sale of the Company's flexible premium variable
annuity contracts and as the broker for the sale of the Fund's shares. These
agreements may be terminated at any time by either MSC or the Company upon sixty
days prior notice.
In addition, the Company has an investment advisory agreement with MONY
whereby MONY provides investment advisory services with respect to the
investment and management of the Company's investment portfolio. The agreement
provides for scheduled fees for actual cost reimbursement and may be terminated
by either party upon 60 days written notice.
5. FIXED MATURITY SECURITIES AND COMMON STOCKS:
Fixed Maturity Securities by Investment Type and Common Stocks:
The cost and estimated fair value (see Note 8) of investments in fixed
maturity securities (including short-term investments and bonds) and common
stocks as of December 31, 1997 and December 31, 1996 are presented in the table
below. Cost is amortized cost for fixed maturity securities and original cost
for common stocks.
<TABLE>
<CAPTION>
GROSS GROSS ESTIMATED
UNREALIZED UNREALIZED FAIR
COST GAINS LOSSES VALUE
------------------- ------------- ----------- -------------------
1997 1996 1997 1996 1997 1996 1997 1996
---- ---- ---- ---- ---- ---- ---- ----
(DOLLARS IN MILLIONS)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
U.S. Treasury securities & obligations of
U.S. government agencies................ $ 5.9 $ 5.9 $ 0.0 $ 0.0 $0.0 $0.0 $ 5.9 $ 5.9
Collateralized mortgage obligations:
Government agency backed................ 123.7 126.4 2.2 1.3 0.1 1.0 125.8 126.7
Non-agency backed....................... 34.5 35.0 2.0 1.5 0.0 0.2 36.5 36.3
Other asset backed securities:
Government agency backed................ 0.2 0.2 0.0 0.0 0.0 0.0 0.2 0.2
Non-agency backed....................... 93.8 98.5 2.1 1.3 0.2 0.7 95.7 99.1
Public utilities.......................... 123.8 129.0 3.1 2.3 0.2 1.0 126.7 130.3
Corporate bonds........................... 676.8 653.0 18.0 13.2 2.2 4.8 692.6 661.4
Affiliates................................ 16.0 0.0 0.0 0.0 0.0 0.0 16.0 0.0
-------- -------- ----- ----- ---- ---- -------- --------
Total bonds............................. 1,074.7 1,048.0 27.4 19.6 2.7 7.7 1,099.4 1,059.9
Commercial paper.......................... 25.7 86.5 0.0 0.0 0.0 0.0 25.7 86.5
-------- -------- ----- ----- ---- ---- -------- --------
Total bonds and short-term
investments........................... $1,100.4 $1,134.5 $27.4 $19.6 $2.7 $7.7 $1,125.1 $1,146.4
======== ======== ===== ===== ==== ==== ======== ========
Common stocks............................. $ 0.8 $ 1.1 $ 0.2 $ 0.1 $0.0 $0.0 $ 1.0 $ 1.2
======== ======== ===== ===== ==== ==== ======== ========
</TABLE>
Amortized cost represents the principal amount of the fixed maturity
securities adjusted by unamortized premium or discount and reduced by writedowns
of $0.4 million and $3.4 million at December 31, 1997 and 1996, respectively, as
required by the NAIC for securities which are in or near default.
F-53
<PAGE> 105
MONY LIFE INSURANCE COMPANY OF AMERICA
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
5. FIXED MATURITY SECURITIES AND COMMON STOCKS (CONTINUED):
At December 31, 1997, 78.2% of the Company's Collateralized Mortgage
Obligation (CMO) portfolio was held in U.S. government and government
agency-backed securities. The remainder of the CMO portfolio consisted of NAIC
category 1 investment grade securities.
Maturities of Fixed Maturity Securities:
The amortized cost and estimated fair value of fixed maturity securities by
maturity date as of December 31, 1997 are as follows:
<TABLE>
<CAPTION>
ESTIMATED
AMORTIZED FAIR
COST VALUE
--------- ---------
($ IN MILLIONS)
<S> <C> <C>
Due in one year or less................................. $ 48.9 $ 49.0
Due after one year through five years................... 411.4 418.1
Due after five years through ten years.................. 380.4 391.3
Due after ten years..................................... 259.7 266.7
-------- --------
$1,100.4 $1,125.1
======== ========
</TABLE>
Fixed maturity securities that are not due at a single maturity date have
been included in the preceding table in the year of final maturity. Actual
maturities may differ from contractual maturities because borrowers may have the
right to call or prepay obligations with or without call or prepayment
penalties.
Proceeds from sales of investments in fixed maturity securities during 1997
and 1996 were $31.3 million and $13.3 million, respectively. Gross gains of $0.5
million in 1997 and $0.2 million in 1996, and gross losses of $4.3 million in
1997 and $0.3 million in 1996 were realized on these sales.
Proceeds from sales of investments in common stocks during 1997 and 1996
were $1.0 million and $0, respectively. Gross gains of $0.7 million in 1997 and
$0 in 1996, and gross losses of $0 in 1997 and $0 in 1996 were realized on these
sales.
There were no non-income producing bonds and redeemable preferred stocks
for the twelve months preceding December 31, 1997. The carrying values of fixed
maturity securities which were non-income producing for the twelve months
preceding December 31, 1996 were $1.0 million.
6. MORTGAGE LOANS AND REAL ESTATE:
The Company invests in mortgage loans collateralized by commercial and
agricultural real estate. Such mortgage loans consist primarily of first
mortgage liens on completed income-producing properties, including agricultural
properties. As of December 31, 1997, $55.3 million of mortgage loans have terms
that require amortization, and $79.5 million of mortgage loans require partial
amortization or are non-amortizing. Mortgage loans delinquent over 90 days or in
process of foreclosure were $0.6 million at December 31, 1997 and there were no
mortgage loans delinquent over 90 days or in process of foreclosure at December
31, 1996. There were no properties acquired through foreclosure during 1997 or
1996.
The Company has performing restructured mortgage loans of $14.1 million as
of December 31, 1997 and $15.0 million as of December 31, 1996. The new terms
typically reduce the contract rate of interest. Interest is recognized in income
based on the modified rate of the loan. Gross interest income on restructured
loans that would have been recorded in accordance with the loans' original terms
was approximately $1.4 million in 1997 and $1.5 million in 1996. Gross interest
income recognized in net income for the period from these loans was $1.0 million
in 1997 and $1.1 million in 1996. There are no commitments to lend additional
funds to any debtor involved in a restructuring.
F-54
<PAGE> 106
MONY LIFE INSURANCE COMPANY OF AMERICA
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
6. MORTGAGE LOANS AND REAL ESTATE (CONTINUED):
At both December 31, 1997 and 1996, there were no mortgage loans that were
non-income producing for the preceding twelve months.
At both December 31, 1997 and 1996, there were no real estate properties
that were non-income producing for the preceding twelve months.
7. INVESTMENT INCOME, REALIZED AND UNREALIZED CAPITAL GAINS (LOSSES):
Net investment income for the years ended December 31, 1997 and 1996 was
derived from the following sources:
<TABLE>
<CAPTION>
1997 1996
---- ----
($ IN MILLIONS)
<S> <C> <C>
NET INVESTMENT INCOME
- ------------------------------------------------------------
Bonds and common stock...................................... $ 79.0 $ 77.5
Mortgage loans.............................................. 12.0 14.4
Real estate (net of property expenses)...................... 1.2 3.0
Policy loans................................................ 3.5 2.7
Other investments (including cash & short-term
investments).............................................. 6.6 7.5
------ ------
Total investment income................................ 102.3 105.1
Investment expenses......................................... 3.3 3.0
------ ------
Net investment income.................................. $ 99.0 $102.1
====== ======
</TABLE>
Net realized capital gains (losses) on investments for the years ended
December 31, 1997 and 1996 are summarized as follows:
<TABLE>
<CAPTION>
1997 1996
---- ----
($ IN MILLIONS)
<S> <C> <C>
REALIZED CAPITAL GAINS (LOSSES)
- ------------------------------------------------------------
Bonds and common stock...................................... $(2.4) $ 0.9
Real estate and mortgage loans.............................. 0.4 (0.1)
Derivative instruments...................................... 0.0 (0.8)
Other....................................................... (0.2) 0.0
----- -----
(2.2) 0.0
Taxes....................................................... (0.5) (0.8)
Transferred to IMR, net of taxes............................ (0.8) (0.9)
----- -----
Net realized capital losses............................ $(3.5) $(1.7)
===== =====
</TABLE>
During 1997 and 1996, realized capital losses resulting from changes in
interest rates on bonds of $0.8 million (net of $0.5 million tax) and $0.9
million (net of $0.5 million tax), respectively, were transferred to the
Company's IMR for future amortization into net income.
Net unrealized capital gains were $2.8 million in 1997 and $1.6 million in
1996. The 1997 and 1996 net unrealized gains include writedowns of approximately
$0.2 million in 1997 and $0 in 1996 on real estate acquired through foreclosure
and mortgage loans in process of foreclosure. These gains and losses are
detailed by asset type in the table below.
F-55
<PAGE> 107
MONY LIFE INSURANCE COMPANY OF AMERICA
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
7. INVESTMENT INCOME, REALIZED AND UNREALIZED CAPITAL GAINS (LOSSES)
(CONTINUED):
<TABLE>
<CAPTION>
1997 1996
---- ----
($ IN MILLIONS)
<S> <C> <C>
UNREALIZED CAPITAL GAINS (LOSSES)
- ------------------------------------------------------------
Bonds and stocks............................................ $ 3.0 $1.6
Real estate and mortgage loans.............................. (0.2) 0.0
----- ----
Total net unrealized capital gains..................... $ 2.8 $1.6
===== ====
</TABLE>
8. ESTIMATED FAIR VALUE OF FINANCIAL INSTRUMENTS:
The estimated fair values of mortgage loans, common stocks, cash,
short-term investments, separate account assets and liabilities, and
investment-type contracts approximate their carrying amounts. The carrying
values of bonds were $1,074.7 million and $1,048.0 million at December 31, 1997
and 1996, respectively. The estimated fair values of bonds were $1,099.4 million
and $1,059.9 million at December 31, 1997 and 1996, respectively.
The methods and assumptions utilized in estimating these fair values of
financial instruments are summarized as follows:
Fixed maturity securities (See Note 5)
The estimated fair values of fixed maturity securities are based upon
quoted market prices, where available. The fair values of fixed maturity
securities not actively traded and other non-publicly traded securities are
estimated using values obtained from independent pricing services or, in the
case of private placements, by discounting expected future cash flows using a
current market interest rate commensurate with the credit quality and term of
the investments.
Mortgage loans
The fair value of mortgage loans is estimated by discounting expected
future cash flows, using current interest rates for similar loans to borrowers
with similar credit risk. Loans with similar characteristics are aggregated for
purposes of the calculations. The fair value of mortgage loans in process of
foreclosure is the estimated fair value of the underlying collateral.
Policy loans
Policy loans are an integral component of insurance contracts and have no
maturity dates. Management has determined that it is not practicable to estimate
the fair value of policy loans.
Separate account assets and liabilities
The estimated fair value of assets held in separate accounts is based
principally on quoted market prices. The fair value of liabilities related to
separate accounts is the amount payable on demand, net of surrender charges.
Investment-type Contract Liabilities
The fair values of annuities are based on estimates of the value of
payments available upon full surrender. The fair values of the Company's
liabilities under guaranteed investment contracts are estimated by discounting
expected cash outflows using interest rates currently offered for similar
contracts with maturities consistent with those remaining for the contracts
being valued, where appropriate.
F-56
<PAGE> 108
MONY LIFE INSURANCE COMPANY OF AMERICA
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
9. OFF BALANCE SHEET RISK AND CONCENTRATIONS OF CREDIT RISK:
Financial Instruments with Off-Balance Sheet Risk:
In 1992, the Company entered into an agreement with a bank to lend
securities to approved borrowers. There were $65,000 of loaned securities as of
December 31, 1997. The minimum collateral on securities loaned is 102% of the
market value of loaned securities. Such securities are marked to market on a
daily basis, adjusting required collateral values accordingly.
Concentrations of Credit Risk:
As of December 31, 1997 and 1996, the Company had no single investment or
series of investments with a single issuer (excluding U.S. Government Agency
securities) exceeding 1.4 percent and 1.3 percent, respectively, of total cash
and invested assets.
The bond portfolio is diversified by industry type. The industries
comprising 10 percent or more of the carrying value of the bond portfolio at
December 31, 1997 are Financial Services of $133.5 million (12.4 percent),
Government and Agencies of $129.8 million (12.1 percent), Energy of $128.3
million (11.9 percent), Non-Government Asset/Mortgage-Backed of $128.3 million
(11.9 percent), Public Utilities of $123.8 million (11.5 percent), and Consumer
Goods and Services of $112.5 million (10.5 percent). At December 31, 1996, the
industries comprising 10 percent or more of the carrying value of the bond
portfolio were Government and Agencies of $132.5 million (12.7 percent),
Non-Government Asset/Mortgage-Backed of $133.5 million (12.7 percent), Public
Utilities of $129.0 million (12.3 percent), Energy of $119.7 million (11.4
percent), and Other Manufacturing of $116.9 million (11.2 percent).
The Company holds below investment grade bonds of $79.7 million at December
31, 1997. Below, investment grade bonds are defined as those securities rated in
categories 3 through 6 by the NAIC, which are approximately equivalent to bonds
rated below BBB by rating agencies. These bonds consist mostly of privately
issued bonds, which are monitored by the Company through extensive internal
analysis of the financial condition of the borrowers, and which include
protective debt covenants. Of these bonds, $66.6 million are in category 3,
which is considered to be medium quality by the NAIC. At December 31, 1996, the
Company's investments in below investment grade bonds were $59.4 million.
The Company has investments in commercial and agricultural mortgage loans
and real estate (including joint ventures). The locations of property
collateralizing mortgage loans and real estate investment carrying values at
December 31, 1997 and 1996 are as follows:
<TABLE>
<CAPTION>
1997 1996
-------------- --------------
$ % $ %
- - - -
($ IN MILLIONS)
<S> <C> <C> <C> <C>
GEOGRAPHIC REGION
- ------------------------------------------
West...................................... 54.0 32.9 71.3 34.3
Mountain.................................. 41.2 25.1 48.3 23.3
Northeast................................. 25.3 15.4 25.6 12.3
Southwest................................. 16.8 10.2 20.9 10.1
Midwest................................... 14.7 8.9 25.5 12.3
Southeast................................. 12.4 7.5 16.1 7.7
----- ----- ----- -----
Total........................... 164.4 100.0 207.7 100.0
===== ===== ===== =====
</TABLE>
The states with the largest concentrations of mortgage loans and real
estate investments at December 31, 1997 are: California, $33.8 million (20.6%);
New York, $19.1 million (11.6%); Texas, $16.2 million (9.9%); Arizona, $13.6
million (8.3%); Washington, $11.6 million (7.1%) and Idaho, $10.7 million
(6.5%).
F-57
<PAGE> 109
MONY LIFE INSURANCE COMPANY OF AMERICA
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
9. OFF BALANCE SHEET RISK AND CONCENTRATIONS OF CREDIT RISK (CONTINUED):
As of December 31, 1997 and 1996, the real estate and mortgage loan
portfolio was also diversified as follows:
<TABLE>
<CAPTION>
1997 1996
-------------- --------------
$ % $ %
- - - -
($ IN MILLIONS)
<S> <C> <C> <C> <C>
PROPERTY TYPE
- --------------------------------------------
Agriculture................................. 99.5 60.5 117.8 56.7
Office Building............................. 24.5 14.9 34.9 16.8
Hotel....................................... 15.0 9.1 21.5 10.4
Retail...................................... 10.3 6.3 12.3 5.9
Industrial.................................. 7.3 4.5 9.4 4.5
Other....................................... 4.4 2.6 4.4 2.1
Apartments.................................. 3.4 2.1 7.4 3.6
----- ----- ----- -----
Total............................. 164.4 100.0 207.7 100.0
===== ===== ===== =====
</TABLE>
10. RESERVES:
The withdrawal characteristics of the Company's annuity actuarial reserves
and deposit liabilities as of December 31, 1997 were as follows:
<TABLE>
<CAPTION>
($ IN MILLIONS)
<S> <C>
Not subject to discretionary withdrawal provision........... $ 77.1
Subject to discretionary withdrawal -- with adjustment:
- at book value less surrender charges of 5% or
more................................................. 180.9
- at market value..................................... 3,403.3
--------
Subtotal..................................... 3,584.2
Subject to discretionary withdrawal -- without adjustment:
- at book value (minimal or no charge or
adjustment).......................................... 475.1
--------
Total annuity actuarial reserves and deposit
liabilities -- gross and net of
reinsurance................................ $4,136.4
========
</TABLE>
The amounts above are included in the Company's statements of admitted
assets, liabilities, capital and surplus as life insurance and annuity reserves
($0.7) billion and separate account liabilities ($3.4) billion.
11. REINSURANCE:
Life insurance business is ceded on a yearly renewable term basis to MONY
and other insurance companies under various reinsurance contracts. The Company's
general practice is to retain no more than $0.5 million of risk on any one
person. The total amount of reinsured life insurance in force on this basis was
$2.7 billion and $2.6 billion at December 31, 1997 and 1996, respectively.
Premiums ceded under these contracts were $16.1 million and $14.6 million;
benefit payments recovered were $11.6 million and $17.3 million; policy reserve
credits recorded were $11.1 million and $10.6 million; and recoverable amounts
on paid and unpaid losses were $2.4 million and $3.5 million in 1997 and 1996,
respectively.
The Company is contingently liable with respect to ceded insurance should
any reinsurer be unable to meet its obligations under these agreements. To limit
the possibility of such losses, the Company evaluates the financial condition of
its reinsurers and monitors concentration of credit risk.
F-58
<PAGE> 110
MONY LIFE INSURANCE COMPANY OF AMERICA
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
12. FEDERAL INCOME TAXES:
The Company is included in the consolidated federal income tax return with
its parent, MONY, and the parent's non-life subsidiaries. The allocation of
federal income taxes is based upon separate return calculations with current
credit for net losses and other federal income tax credits provided to the life
insurance members of the affiliated group. Intercompany tax balances are settled
annually in the fourth quarter.
The Company's federal income tax returns for years through 1991 have been
examined with no proposed material adjustments. In the opinion of management,
adequate provision has been made for any additional taxes that may become due
with respect to open years.
Pre-tax operating gains and pre-tax realized gains, as reported in the
accompanying statements of operations, differ from taxable income reported for
tax purposes. Significant differences include the deferral and amortization of
policy acquisition costs for tax purposes, the difference between statutory and
tax reserves, depreciation expense and related recapture, capital gains deferred
to the IMR, and equity in joint ventures.
13. COMMITMENTS AND CONTINGENCIES:
In late 1995 and during 1996, a number of purported class actions were
commenced in various state and federal courts against the Company and MONY ("the
Companies") alleging that the Companies engaged in deceptive sales practices in
connection with the sale of whole and universal life insurance policies during
the period 1980 to the present. Although the claims asserted in each case are
not identical, they seek substantially the same relief under essentially the
same theories of recovery (i.e. breach of contract, fraud, negligent
misrepresentation, negligent supervision and training, breach of fiduciary duty,
unjust enrichment and violation of state insurance and/or deceptive business
practice laws). The Companies have answered the complaints in each action
(except for one being voluntarily held in abeyance), have denied any wrongdoing,
and have asserted numerous affirmative defenses.
On June 7, 1996, the New York State Supreme Court certified the Goshen
case, being the first of the aforementioned class actions filed, as a nationwide
class consisting of all persons or entities who have, or at the time of the
policy's termination, had an ownership interest in a whole or universal life
insurance policy issued by the Companies and sold on an alleged "vanishing
premium" basis during the period January 1, 1982 to December 31, 1995. On March
27, 1997, the Companies filed a motion to dismiss or, alternatively, motion for
summary judgment on all counts of the complaint.
The Massachusetts District Court in the Multidistrict Litigation has
entered an order recognizing the Goshen case as the lead case and essentially
holding all of the federal cases in abeyance pending the action of the Goshen
case. Consequently, all other putative class actions have been either
consolidated and transferred by the Judicial Panel on Multidistrict Litigation
to the United States District Court for the District of Massachusetts, or are
being voluntarily held in abeyance pending the outcome of the Goshen case.
On October 21, 1997, the New York State Supreme Court granted the
Companies' motion for summary judgment and dismissed all claims filed in the
Goshen case against the Companies. The order by the New York State Supreme Court
has been appealed to the Appellate Division by plaintiffs and all actions before
the United States District Court for the District of Massachusetts are still
pending.
In addition to the matters discussed above, the Company is involved in
various other legal actions and proceedings in connection with its businesses.
The claimants in certain of these actions and proceedings seek damages of
unspecified amounts. In addition, insurance companies are subject to
assessments, up to statutory limits, by state guaranty funds for losses of
policyholders of insolvent insurance companies.
F-59
<PAGE> 111
MONY LIFE INSURANCE COMPANY OF AMERICA
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
13. COMMITMENTS AND CONTINGENCIES (CONTINUED):
In the opinion of management of the Company, resolution of contingent
liabilities arising from litigation, income taxes and other matters will not
have a material adverse effect on the Company's statutory surplus or results of
operations.
At December 31, 1997, the Company had a commitment to issue a $1.9 million
fixed rate farm loan with an interest rate of 7.8% and a duration of 10 years.
There were no outstanding bond commitments as of December 31, 1997.
14. YEAR 2000:
The Year 2000 issue is the result of the widespread use of computer
programs written using two digits (rather than four) to define the applicable
year. Such programming was a common industry practice designed to avoid the
significant costs associated with additional mainframe capacity necessary to
accommodate a four-digit year field. As a result, any of the Company's computer
systems that have time-sensitive software may recognize a date using "00" as the
year 1900 rather than the year 2000. This could result in a major systems
failure or miscalculations. The Company has conducted a comprehensive review of
its computer systems to identify the systems that could be affected by the Year
2000 issue and has developed and implemented a plan to resolve the issue. The
Company currently believes that, with modifications to existing software and
converting to new software, the Year 2000 issue will not pose significant
operational problems for the Company's computer systems. However, if such
modifications and conversions are not completed on a timely basis, the Year 2000
issue may have a material impact on the operations of the Company. Furthermore,
even if the Company completes such modifications and conversions on a timely
basis, there can be no assurance that the failure by vendors or other third
parties to solve the Year 2000 problem will not have a material impact on the
operations of the Company.
F-60
<PAGE> 112
MONY LIFE INSURANCE COMPANY OF AMERICA
SUPPLEMENTAL SCHEDULE OF SELECTED FINANCIAL DATA
FOR THE YEAR ENDED DECEMBER 31, 1997
(AMOUNTS IN $ THOUSANDS)
The following is a summary of certain financial data from the Company's
Annual Statement included in other exhibits and schedules subjected to audit
procedures by independent accountants and utilized by the Company's actuaries in
the determination of reserves:
<TABLE>
<S> <C>
INVESTMENT INCOME EARNED:
- ------------------------------------------------------------
U.S. Government bonds................................... 387
Other bonds (unaffiliated).............................. 77,378
Bonds of affiliates..................................... 602
Preferred stocks (unaffiliated)......................... 0
Preferred stocks of affiliates.......................... 0
Common stocks (unaffiliated)............................ 1
Common stocks of affiliates............................. 0
Mortgage loans.......................................... 12,097
Real estate............................................. 8,565
Premium notes, policy loans and liens................... 3,465
Collateral loans........................................ 0
Cash on hand and on deposit............................. 117
Short-term investments.................................. 4,652
Other invested assets................................... 571
Derivative instruments.................................. 0
Aggregate write-ins for investment income............... 1,355
----------
Gross investment income............................. 109,190
==========
REAL ESTATE OWNED -- BOOK VALUE LESS ENCUMBRANCES........... 22,627
MORTGAGE LOANS -- BOOK VALUE:
- ------------------------------------------------------------
Farm mortgages.......................................... 99,492
Residential mortgages................................... 0
Commercial mortgages.................................... 35,336
----------
Total mortgage loans................................ 134,828
==========
MORTGAGE LOANS BY STANDING -- BOOK VALUE:
- ------------------------------------------------------------
Good standing........................................... 120,120
Good standing with restructured terms................... 14,126
Interest overdue more than three months, not in
foreclosure............................................ 0
Foreclosure in process.................................. 582
----------
Total mortgage loans................................ 134,828
==========
OTHER LONG TERM ASSETS -- STATEMENT VALUE................... 52,824
COLLATERAL LOANS............................................ 0
BONDS AND STOCKS OF PARENTS, SUBSIDIARIES AND
AFFILIATES -- BOOK VALUE:
- ------------------------------------------------------------
Bonds................................................... 16,000
Preferred Stocks........................................ 0
Common Stocks........................................... 0
</TABLE>
F-61
<PAGE> 113
MONY LIFE INSURANCE COMPANY OF AMERICA
SUPPLEMENTAL SCHEDULE OF SELECTED FINANCIAL DATA -- (CONTINUED)
FOR THE YEAR ENDED DECEMBER 31, 1997
(AMOUNTS IN $ THOUSANDS)
<TABLE>
<S> <C>
BONDS AND SHORT-TERM INVESTMENTS BY CLASS AND MATURITY:
- ------------------------------------------------------------
BONDS AND SHORT-TERM INVESTMENTS BY MATURITY -- STATEMENT
VALUE:
- ------------------------------------------------------------
Due within one year or less............................. 84,300
Over 1 year through 5 years............................. 573,903
Over 5 years through 10 years........................... 344,927
Over 10 years through 20 years.......................... 68,716
Over 20 years........................................... 28,578
----------
Total by Maturity................................... 1,100,424
==========
BONDS AND SHORT-TERM INVESTMENTS BY MATURITY -- STATEMENT
VALUE:
- ------------------------------------------------------------
Class 1................................................. 579,042
Class 2................................................. 441,677
Class 3................................................. 66,571
Class 4................................................. 12,524
Class 5................................................. 0
Class 6................................................. 610
----------
Total by Class...................................... 1,100,424
==========
TOTAL BONDS AND SHORT-TERM INVESTMENTS -- PUBLICLY TRADED... 645,558
TOTAL BONDS AND SHORT-TERM INVESTMENTS -- PRIVATELY
PLACED.................................................... 454,866
PREFERRED STOCKS -- STATEMENT VALUE......................... 0
COMMON STOCKS -- MARKET VALUE............................... 981
SHORT-TERM INVESTMENTS -- BOOK VALUE........................ 25,700
FINANCIAL OPTIONS OWNED -- STATEMENT VALUE.................. 0
FINANCIAL OPTIONS WRITTEN AND IN FORCE -- STATEMENT VALUE... 0
FINANCIAL FUTURES CONTRACTS OPEN -- CURRENT PRICE........... 0
CASH ON HAND AND ON DEPOSIT................................. 20,256
LIFE INSURANCE IN FORCE:
- ------------------------------------------------------------
Industrial.............................................. 0
Ordinary................................................ 11,744,853
Credit Life............................................. 0
Group Life.............................................. 1,875,204
AMOUNT OF ACCIDENTAL DEATH INSURANCE IN FORCE UNDER ORDINARY
POLICIES.................................................. 158,466
LIFE INSURANCE POLICIES WITH DISABILITY PROVISIONS IN FORCE:
- ------------------------------------------------------------
Industrial.............................................. 0
Ordinary................................................ 3,671,469
Credit Life............................................. 0
Group Life.............................................. 199,912
SUPPLEMENTARY CONTRACTS IN FORCE:
- ------------------------------------------------------------
Ordinary -- Not Involving Life Contingencies
Amount on Deposit................................... 19,131
Income Payable...................................... 969
Ordinary -- Involving Life Contingencies
Income Payable...................................... 2,996
Group -- Not Involving Life Contingencies
Amount on Deposit................................... 28
Income Payable...................................... 0
Group -- Involving Life Contingencies
Income Payable...................................... 15
</TABLE>
F-62
<PAGE> 114
MONY LIFE INSURANCE COMPANY OF AMERICA
SUPPLEMENTAL SCHEDULE OF SELECTED FINANCIAL DATA -- (CONTINUED)
FOR THE YEAR ENDED DECEMBER 31, 1997
(AMOUNTS IN $ THOUSANDS)
<TABLE>
<S> <C>
ANNUITIES:
- ------------------------------------------------------------
Ordinary
- ------------------------------------------------------------
Immediate -- Amount of Income Payable............... 0
Deferred -- Fully Paid -- Account Balance........... 0
Deferred -- Not Fully Paid -- Account Balance....... 0
Group
- ------------------------------------------------------------
Amount of Income Payable............................ 0
Fully Paid -- Account Balance....................... 61,031
Not Fully Paid -- Account Balance................... 0
ACCIDENT AND HEALTH INSURANCE -- PREMIUMS IN FORCE:
- ------------------------------------------------------------
Ordinary................................................ 0
Group................................................... 0
Credit.................................................. 0
DEPOSIT FUNDS AND DIVIDEND ACCUMULATIONS:
- ------------------------------------------------------------
Deposit Funds -- Account Balance........................ 632,579
Dividend Accumulations -- Account Balance............... 0
CLAIM PAYMENTS 1997:
- ------------------------------------------------------------
Group Accident and Health -- Year Ended December 31,
1997................................................... 0
1997................................................ 0
1996................................................ 0
1995................................................ 0
1994................................................ 0
1993................................................ 0
Prior............................................... 0
CLAIM PAYMENTS 1997:
- ------------------------------------------------------------
Other Accident and Health -- Year Ended December 31,
1997
1997................................................ 0
1996................................................ 0
1995................................................ 0
1994................................................ 0
1993................................................ 0
Prior............................................... 0
Other coverages that use developmental methods to
calculate claims reserves -- Year Ended December 31,
1997
1997................................................ 0
1996................................................ 0
1995................................................ 0
1994................................................ 0
1993................................................ 0
Prior............................................... 0
</TABLE>
F-63
<PAGE> 115
MONY LIFE INSURANCE COMPANY OF AMERICA
UNAUDITED INTERIM STATEMENT OF ADMITTED ASSETS, LIABILITIES,
CAPITAL AND SURPLUS -- STATUTORY BASIS
SEPTEMBER 30, 1998
(IN THOUSANDS)
<TABLE>
<S> <C>
ASSETS
Cash and invested assets:
Cash and short-term investments........................ $ 34,640
Bonds.................................................. 1,053,051
Common stocks.......................................... 37
Mortgage loans......................................... 136,930
Real estate............................................ 9,437
Policy loans........................................... 50,494
Other invested assets.................................. 7,627
----------
Total cash and invested assets.................... 1,292,216
Investment income due and accrued........................... 21,718
Other assets................................................ 4,064
Separate account assets..................................... 3,745,009
----------
Total assets...................................... $5,063,007
==========
LIABILITIES, CAPITAL AND SURPLUS
Liabilities:
Life insurance and annuity reserves.................... $1,205,952
Deposits left with the Company......................... 25,360
Policy claims in process of settlement................. 8,216
Federal income taxes due or accrued.................... 28,575
Transfers from separate accounts....................... (144,877)
Other liabilities...................................... 25,865
Separate account liabilities........................... 3,745,009
Interest maintenance reserve........................... 5,205
Investment reserves.................................... 6,000
Asset valuation reserve................................ 14,950
----------
Total liabilities................................. 4,920,255
Capital and surplus:
Capital stock, $1.00 par value; authorized, 5,000,000
shares
Issued and outstanding, 2,500,000 shares............. 2,500
Additional paid-in capital............................. 133,500
Unassigned funds....................................... 6,752
----------
Total capital and surplus......................... 142,752
----------
Total liabilities, capital and surplus............ $5,063,007
==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-64
<PAGE> 116
MONY LIFE INSURANCE COMPANY OF AMERICA
UNAUDITED INTERIM STATEMENTS OF OPERATIONS -- STATUTORY BASIS
<TABLE>
<CAPTION>
FOR THE NINE MONTHS ENDED
SEPTEMBER 30,
--------------------------
1998 1997
---- ----
(IN THOUSANDS)
<S> <C> <C>
Premiums, annuity considerations and fund deposits.......... $634,908 $593,624
Net investment income....................................... 72,256 74,893
Other income (net).......................................... 248 248
-------- --------
707,412 668,765
-------- --------
Policyholder and contractholder benefits.................... 382,104 295,575
Change in policy and contract reserves...................... (33,864) (34,736)
Commissions................................................. 27,240 27,292
Operating expenses.......................................... 66,231 44,029
Transfer to separate accounts............................... 248,784 302,198
-------- --------
690,495 634,358
-------- --------
Net gain from operations before federal income tax.......... 16,917 34,407
Federal income taxes........................................ 9,087 17,390
-------- --------
Net gain from operations.................................... 7,830 17,017
Net realized capital losses............................ (462) (3,895)
-------- --------
Net income.................................................. $ 7,368 $ 13,122
======== ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-65
<PAGE> 117
MONY LIFE INSURANCE COMPANY OF AMERICA
UNAUDITED INTERIM STATEMENTS OF CAPITAL AND SURPLUS -- STATUTORY BASIS
<TABLE>
<CAPTION>
FOR THE NINE MONTHS ENDED
SEPTEMBER 30,
--------------------------
1998 1997
---- ----
(IN THOUSANDS)
<S> <C> <C>
Capital and surplus, beginning of period.................... $133,151 $121,814
-------- --------
Net income.................................................. 7,368 13,122
Change in net unrealized capital gains...................... 244 3,131
Change in non-admitted assets............................... 667 22
Change in asset valuation reserve........................... 1,322 (1,753)
-------- --------
Net change in capital and surplus for the period............ 9,601 14,522
-------- --------
Capital and surplus, end of period.......................... $142,752 $136,336
======== ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-66
<PAGE> 118
MONY LIFE INSURANCE COMPANY OF AMERICA
UNAUDITED INTERIM STATEMENTS OF CASH FLOWS -- STATUTORY BASIS
<TABLE>
<CAPTION>
FOR THE NINE MONTHS ENDED
SEPTEMBER 30,
--------------------------
1998 1997
---- ----
(IN THOUSANDS)
<S> <C> <C>
CASH FROM OPERATIONS:
Premiums, annuity considerations and fund deposits..... $ 633,995 $ 593,623
Investment income, net of investment expenses.......... 72,272 71,617
Other income........................................... 248 248
Policy benefits paid................................... (385,902) (295,944)
Transfers to separate accounts......................... (264,717) (331,069)
Commissions, other expenses and taxes paid............. (90,826) (70,065)
Federal income taxes (excluding tax on capital
gains)............................................... 0 (3)
--------- ---------
Net cash from operations..................... (34,930) (31,593)
--------- ---------
CASH FROM INVESTMENTS:
Proceeds from investments sold, matured or repaid:
Bonds............................................. 133,440 95,550
Stocks............................................ 955 1,050
Mortgage loans.................................... 16,301 31,220
Real estate....................................... 14,018 13,924
Other invested assets............................. 609 1,356
Other............................................. (6) 4,243
--------- ---------
Total investment proceeds.................... 165,317 147,343
--------- ---------
Cost of investments acquired:
Bonds............................................. 109,527 124,137
Stocks............................................ 0 68
Mortgage loans.................................... 17,936 7,801
Real estate....................................... 382 1,030
Other invested assets............................. 1,236 (3,544)
Change in policy loans............................ 4,602 3,851
--------- ---------
Total investments acquired................... 133,683 133,343
--------- ---------
Net cash from investments.................... 31,634 14,000
--------- ---------
CASH FROM FINANCING AND MISCELLANEOUS SOURCES:
Cash provided:
Other sources..................................... (8,019) 589
--------- ---------
Net cash from financing and miscellaneous
sources.................................... (8,019) 589
--------- ---------
Net change in cash and short-term investments.......... (11,315) (17,004)
Cash and short-term investments, beginning of period........ 45,955 90,207
--------- ---------
Cash and short-term investments, end of period.............. $ 34,640 $ 73,203
========= =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-67
<PAGE> 119
MONY LIFE INSURANCE COMPANY OF AMERICA
NOTES TO UNAUDITED INTERIM FINANCIAL STATEMENTS
1. ORGANIZATION:
MONY Life Insurance Company of America (the "Company"), an Arizona
corporation, is a wholly owned subsidiary of The Mutual Life Insurance Company
of New York ("MONY"), a mutual life insurance company. The Company's primary
business is to provide interest-sensitive life insurance and asset accumulation
products to business owners, growing families, and pre-retirees. The Company's
insurance and financial products are marketed and distributed directly to
individuals primarily through MONY's career agency sales force. These products
are sold throughout the United States (except New York) and Puerto Rico.
On September 8, 1997, MONY announced that it is pursuing converting to a
stock life insurance company through demutualization. In connection with the
demutualization, MONY has prepared a Plan of Reorganization ("the Plan") which
is subject to approval by the Insurance Department of the State of New York as
well as adoption by MONY's Board of Trustees and approval by MONY's
policyholders.
In accordance with the Plan, subject to the approvals indicated above,
among other things, MONY will convert from a New York mutual life insurance
company to a New York stock life insurance company (the "Plan of
Demutualization") and become a wholly owned subsidiary of MONY Group, Inc. (the
"Holding Company"), a holding company organized in Delaware for the purpose of
becoming the parent holding company of MONY.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
The unaudited interim financial statements of MONY Life Insurance Company
of America have been prepared on the basis of accounting practices and
procedures prescribed or permitted by the Insurance Department of the State of
Arizona, which are currently considered generally accepted accounting principles
for stock life insurance subsidiaries (domiciled in Arizona) of mutual life
insurance companies.
The accompanying unaudited interim financial statements, in the opinion of
the Company's management, reflect all normal recurring adjustments necessary for
a fair presentation of the interim financial position and results of operations.
Results of operations for the nine months ended September 30, 1998 are not
necessarily indicative of results to be expected for the full year. These
interim financial statements should be read in conjunction with the Company's
annual audited financial statements.
3. ESTIMATED FAIR VALUE OF FIXED INCOME AND MORTGAGE INVESTMENTS:
The Company's fixed income securities are carried at amortized cost which
represents the principal amount adjusted by unamortized premium or discount. All
the securities in the portfolio were in good standing at September 30, 1998.
Fair values of fixed income securities are based upon quoted market prices,
where available. The fair values of fixed income securities not actively traded
and other non-publicly traded securities are estimated using values obtained
from independent pricing services or, in the case private placements, by
discounting expected future cash flows using a current market interest rate
commensurate with the credit, quality and term of the investments. Fixed income
securities, which include short-term investments and bonds, had an estimated
fair value of $1,125.4 million and an amortized cost of $1,082.2 million at
September 30, 1998.
Mortgage loans are collateralized by commercial and agricultural real
estate and consist primarily of first mortgage liens on completed income
producing properties or agricultural properties. The fair value of mortgage
loans is estimated by discounting expected future cash flows, using current
interest rates for similar loans to borrowers with similar credit risk. Loans
with similar characteristics are aggregated for purposes of the calculations.
The resulting estimated fair values are not necessarily indicative of the values
that could be negotiated in an actual sale. The estimated fair value of the
Company's investment in mortgage loans at September 30, 1998 approximates its
carrying value of $136.9 million.
F-68
<PAGE> 120
APPENDIX A
DEATH BENEFIT PERCENTAGE FOR
GUIDELINE PREMIUM/CASH VALUE CORRIDOR TEST
<TABLE>
<CAPTION>
APPLICABLE
ATTAINED AGE PERCENTAGE
- ------------ ----------
<S> <C>
40 and Under................................................ 250%
41.......................................................... 243
42.......................................................... 236
43.......................................................... 229
44.......................................................... 222
45.......................................................... 215
46.......................................................... 209
47.......................................................... 203
48.......................................................... 197
49.......................................................... 191
50.......................................................... 185
51.......................................................... 178
52.......................................................... 171
53.......................................................... 164
54.......................................................... 157
55.......................................................... 150
56.......................................................... 146
57.......................................................... 142
58.......................................................... 138
59.......................................................... 134
60.......................................................... 130
61.......................................................... 128
62.......................................................... 126
63.......................................................... 124
64.......................................................... 122
65.......................................................... 120
66.......................................................... 119
67.......................................................... 118
68.......................................................... 117
69.......................................................... 116
70.......................................................... 115
71.......................................................... 113
72.......................................................... 111
73.......................................................... 109
74.......................................................... 107
75-90....................................................... 105
91.......................................................... 104
92.......................................................... 103
93.......................................................... 102
94-100...................................................... 101
</TABLE>
A-1
<PAGE> 121
[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE> 122
APPENDIX B
MONTHLY PER $1,000 SPECIFIED AMOUNT FACTORS
<TABLE>
<CAPTION>
ISSUE FACTOR
AGE PER $1,000
- ----- ----------
<S> <C>
0-17........................................................ $0.07
18-36....................................................... 0.08
37.......................................................... 0.09
38.......................................................... 0.09
39.......................................................... 0.10
40.......................................................... 0.10
41.......................................................... 0.10
42.......................................................... 0.11
43.......................................................... 0.11
44.......................................................... 0.12
45.......................................................... 0.12
46.......................................................... 0.12
47.......................................................... 0.13
48.......................................................... 0.13
49.......................................................... 0.14
50.......................................................... 0.14
51.......................................................... 0.14
52.......................................................... 0.15
53.......................................................... 0.15
54.......................................................... 0.16
55.......................................................... 0.16
56.......................................................... 0.16
57.......................................................... 0.17
58.......................................................... 0.17
59.......................................................... 0.18
60.......................................................... 0.18
61.......................................................... 0.18
62.......................................................... 0.19
63.......................................................... 0.19
64.......................................................... 0.20
65.......................................................... 0.20
66.......................................................... 0.20
67.......................................................... 0.21
68.......................................................... 0.21
69.......................................................... 0.22
70.......................................................... 0.22
71.......................................................... 0.22
72.......................................................... 0.23
73.......................................................... 0.23
74.......................................................... 0.24
75.......................................................... 0.24
76.......................................................... 0.24
77.......................................................... 0.25
78.......................................................... 0.25
79.......................................................... 0.26
80.......................................................... 0.26
81.......................................................... 0.26
82.......................................................... 0.27
83.......................................................... 0.27
84.......................................................... 0.28
85.......................................................... 0.28
</TABLE>
B-1
<PAGE> 123
[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE> 124
APPENDIX C
GUARANTEED DEATH BENEFIT RIDER
MONTHLY GUARANTEE PREMIUM FOR GUARANTEED DEATH
BENEFIT RIDER WITH TEN YEAR/AGE 70 GUARANTEE PERIOD
<TABLE>
<CAPTION>
MONTHLY GUARANTEE
PREMIUM
-----------------
<S> <C>
Specified Amount = $200,000
Male age 45 Preferred Nonsmoker Death Benefit Option 1...... $229.17
Female age 45 Preferred Nonsmoker Death Benefit Option 1.... $174.00
Male age 45 Standard Smoker Death Benefit Option 1.......... $379.83
Male age 45 Preferred Nonsmoker Death Benefit Option 2...... $229.17
Male age 35 Preferred Nonsmoker Death Benefit Option 1...... $155.83
Male age 55 Preferred Nonsmoker Death Benefit Option 1...... $370.83
</TABLE>
C-1
<PAGE> 125
[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE> 126
APPENDIX D
ILLUSTRATIONS OF DEATH PROCEEDS, FUND VALUES AND
CASH VALUES, AND PREMIUM OUTLAYS
The following tables illustrate how the key financial elements of the
Policy work, specifically, how the death benefits, Fund Values and Cash Values
could vary over an extended period of time. In addition, each table compares
these values with premiums paid accumulated with interest.
The Policies illustrated include the following:
<TABLE>
<CAPTION>
DEATH
BENEFIT SPECIFIED SEE
SEX AGE UNDERWRITING CLASS SEX AGE UNDERWRITING CLASS OPTION AMOUNT PAGE
- --- --- ------------------ --- --- ------------------ ------- --------- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Male 45 Preferred Non-smoker Female 45 Preferred Non-smoker 1 $200,000 D-4
Male 45 Standard Smoker Female 45 Standard Smoker 1 $200,000 D-14
Male 45 Preferred Non-smoker Female 45 Preferred Non-smoker 2 $200,000 D-27
Male 35 Preferred Non-smoker Female 35 Preferred Non-smoker 1 $200,000 D-34
Male 55 Preferred Non-smoker Female 55 Preferred Non-smoker 1 $200,000 D-45
</TABLE>
The tables show how Death Proceeds, Fund Values and Cash Values of a
hypothetical Policy could vary over an extended period of time if the
Subaccounts of the Variable Account had constant hypothetical gross annual
investment returns of 0%, 6% or 12% over the periods indicated in each table.
The values will differ from those shown in the tables if the annual investment
returns are not absolutely constant. That is, the death benefits, Fund Values
and Cash Values will be different if the returns averaged 0%, 6% or 12% over a
period of years but went above or below those figures in individual Policy
years. These illustrations assume that no Policy Loan has been taken. The
amounts shown would differ if unisex rates were used.
The amounts shown for Death Proceeds, Fund Values and Cash Values reflect
the fact the net investment return on the Policy is lower than the gross
investment return on the Subaccounts of the Variable Account. This results from
the charges levied against the Subaccounts of the Variable Account (i.e., the
mortality and expense risk charge) as well as the premium loads, administrative
charges and Surrender Charges. The difference between the Fund Value and the
Cash Value in the first 14 years is the Surrender Charge.
The tables illustrate cost of insurance and expense charges at both current
rates (which are described under Cost of Insurance) and at the maximum rates
guaranteed in the Policies. The amounts shown at the end of each Policy year
reflect a daily charge against the Funds as well as those assessed against the
Subaccounts. These charges include the charge against the Subaccounts for
mortality and expense risks and the effect on each Subaccount's investment
experience of the charge to Portfolio assets for investment management and
direct expenses. The mortality and expense risk fee is .35% annually on a
guaranteed basis.
The tables also reflect a deduction for a daily investment advisory fee and
for other expenses of the Portfolio at a rate equivalent to an annual rate of
0.75% of the aggregate average daily net assets of the Portfolio. This
hypothetical rate is representative of the average maximum investment advisory
fee and other expenses of the Portfolios applicable to the Subaccounts of the
Variable Account. Actual fees and other expenses vary by Portfolio and may be
subject to agreements by the sponsor to waive or otherwise reimburse each
Portfolio for operating expenses which exceed certain limits. There can be no
assurance that the expense reimbursement arrangements will continue in the
future, and any unreimbursed expenses would be reflected in the values included
on the tables.
The effect of these investment management and direct expenses on a 0% gross
rate of return would result in a net rate of return of -.75%, on 6% it would be
5.25%, and on 12% it would be 11.25%.
The tables assume the deduction of charges including administrative and
sales charges. There are tables for the Policies listed in the chart above for
death benefit Options 1 or 2 and each option is illustrated using current and
guaranteed policy cost factors. The tables reflect the fact that the Company
does not currently
D-1
<PAGE> 127
make any charge against the Variable Account for state or federal taxes. If such
a charge is made in the future, it will take a higher rate of return to produce
after-tax returns of 0%, 6% or 12%.
The following are descriptions of Table columns and key terms:
Age: Younger Insured's attained age at the end of the policy year
Premium Outlay: The annualized out-of-pocket premium payments for each
policy year including scheduled and any anticipated unscheduled premium
payments. Premium payments are assumed to be paid at the beginning of each
premium paying period. Amounts of surrenders and loans plus loan interest if
any, are shown on the pages captioned "Premiums, Full Surrender and Policy
Loans".
Premium Accumulated at 5%: is equal to the premiums compounded at an
annual effective rate of 5% and is shown at the end of the year.
GUARANTEED CHARGES AT 0.00%, 6.00% OR 12.00%
Cash Value: The value of the subaccounts at the end of each policy year
assuming a 0.00%, 6.00% or 12.00% hypothetical rate of return on the Funds, less
all charges, fees and deductions at their guaranteed maximum. The cash value
also takes into account any loans illustrated, as well as, the applicable
surrender charges that would apply if the policy were surrendered prior to the
end of the first ten years.
Fund Value: The value of the subaccounts at the end of each policy year
assuming a 0.00%, 6.00% or 12.00% hypothetical rate of return on the Funds, less
all charges, fees and deductions at their guaranteed maximum. The Fund Value
DOES NOT take into account the applicable surrender charges that would apply if
the policy were surrendered prior to the end of the first ten years.
Death Proceeds: The benefit payable if the insured's death occurs at the
end of the policy year, assuming a 0.00%, 6.00% or 12,00% hypothetical rate of
return on the Funds, less all charges, fees and deductions at their guaranteed
maximums.
CURRENT CHARGES AT 0.00%, 6.00% OR 12.00%
Cash Value: The value of the subaccounts at the end of each policy year
assuming a 0.00%, 6.00% or 12.00% hypothetical rate of return on the Funds, less
all charges, fees and deductions at the current, non-guaranteed rates. The cash
value also takes into account any loans illustrated, as well as, the applicable
surrender charges that would apply if the policy were surrendered prior to the
end of the first ten years.
Fund Value: The value of the subaccounts at the end of each policy year
assuming a 0.00%, 6.00% or 12.00% hypothetical rate of return on the Funds, less
all charges, fees and deductions at the current, non-guaranteed rates. The Fund
Value DOES NOT take into account the applicable surrender charges that would
apply if the policy were surrendered prior to the end of the first ten years.
Death Proceeds: The benefit payable if the insured's death occurs at the
end of the policy year assuming a 0.00%, 6.00% or 12.00% hypothetical rate of
return on the Funds, less all charges, fees and deductions at the current,
non-guaranteed rates.
The Company will furnish, upon request, a comparable illustration based on
the age and sex of the proposed Insured, standard Premium Class assumptions and
an initial Specified Amount and Scheduled Premium Payments of the applicant's
choice. If a Policy is purchased, an individualized illustration will be
delivered reflecting the Scheduled Premium Payment chosen and the Insured's
actual risk class. After issuance, the Company will provide upon request an
illustration of future Policy benefits based on both guaranteed and current cost
factor assumptions and actual Account Value.
The following is the page of supplemental footnotes to each of the flexible
premium variable life to age 100 numeric summary and standard ledger statements
which follow and which begin on pages B-4.
D-2
<PAGE> 128
STANDARD LEDGER STATEMENT -- SUPPLEMENTAL FOOTNOTE PAGE
MONY CUSTOM EQUITYMASTER
FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
MONY LIFE INSURANCE COMPANY OF AMERICA
ADDITIONAL INFORMATION
These policies have been tested for the possibility of classification as a
modified endowment. This test is not a guarantee that a policy will not be
classified as a modified endowment.
This illustration has been checked against federal tax laws relating to
their definition of life insurance and is in compliance based on proposed
premium payments and coverages. Any decrease in specified amount and/or a change
in death benefit option 2 to death benefit option 1 and/or surrenders occurring
in the first 15 years may cause a taxable event. In addition, if the policy is
defined as a modified endowment policy, a loan, surrender, or assignment or
pledge (unless such assignment or pledge is for burial expenses and the maximum
death benefit is not in excess of $25,000) may be considered a taxable
distribution and a ten percent penalty may be added to any tax on the
distribution. Please consult your tax advisor for advice.
GUIDELINE PREMIUMS
<TABLE>
<CAPTION>
DEATH
BENEFIT INITIAL GUIDELINE INITIAL GUIDELINE
SEX AGE UNDERWRITING CLASS SEX AGE UNDERWRITING CLASS OPTION SINGLE PREMIUM ANNUAL PREMIUM
- --- --- ------------------ --- --- ------------------ ------- ----------------- -----------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Male 45 Preferred Non-smoker Female 45 Preferred Non-smoker 1 $28,330.66 $2,420.01
Male 45 Standard Smoker Female 45 Standard Smoker 1 $33,905.16 $2,881.48
Male 45 Preferred Non-smoker Female 45 Preferred Non-smoker 2 $28,330.66 $9,458.29
Male 35 Preferred Non-smoker Female 35 Preferred Non-smoker 1 $17,379.05 $1,518.57
Male 55 Preferred Non-smoker Female 55 Preferred Non-smoker 1 $46,771.69 $4,057.53
</TABLE>
Values shown on these illustrations are based on a policyowner tax bracket
of 0%.
Premiums are assumed to be paid at the beginning of the payment period.
Policy values and ages are shown as of the end of the policy year and reflect
the effect of all loans and surrenders. The death proceeds, fund value and value
upon surrender will differ if premiums are paid in different amounts,
frequencies, or not on the due date.
The policy's cash value is net of any applicable surrender charge.
Premiums less the following deductions are added to the fund value:
1. A premium tax charge of 2.25% of gross premiums in all policy years.
2. A sales charge on the gross premiums. The sales charges equal 6% of
each premium dollar paid up to the Target Premium, and 3% of all
premiums after the tenth Policy year.
3. A DAC tax charge of 1.50% of gross premiums in all policy years.
Those columns assuming guaranteed charges use the current monthly mortality
charges, current monthly administrative charges, current charges for mortality
and expense risks, current charges for rider benefits, if any, and current
premium sales charge ("current charges" for the first year) as well as the
assumed hypothetical gross annual investment return indicated. Thereafter these
columns use guaranteed monthly mortality charges, guaranteed monthly
administrative charges, guaranteed charges for mortality and expense risks,
guaranteed charges for rider benefits if any, guaranteed maximum premium sales
charge, and the assumed hypothetical gross annual investment return indicated.
Those columns assuming current charges are based upon "current charges" and the
assumed hypothetical gross annual investment return indicated.
The current charges declared by MONY Life Insurance Company of America are
guaranteed for the first policy year and apply to policies issued as of the
illustration preparation date and could change between the preparation date and
the date the policy is issued. After the first policy year, current charges are
not guaranteed, and may be changed at the discretion of MONY Life Insurance
Company of America.
D-3
<PAGE> 129
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
<TABLE>
<S> <C>
NUMERIC SUMMARY The following table shows how differences in investment
returns and policy charges would affect policy cash value
and death benefit.
</TABLE>
<TABLE>
<CAPTION>
GUARANTEED CHARGES* GUARANTEED CHARGES** CURRENT CHARGES***
-------------------------- -------------------------- --------------------------
0.00% (-.75% NET) 0.00% (-.75% NET) 0.00% (-.75% NET)
POLICY PREMIUM CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,323 0 876 200,000 0 876 200,000 0 876 200,000
5 1,323 3,428 4,221 200,000 3,428 4,221 200,000 3,479 4,272 200,000
10 1,323 7,817 7,949 200,000 7,817 7,949 200,000 8,101 8,233 200,000
20 1,323 14,448 14,448 200,000 14,448 14,448 200,000 16,065 16,065 200,000
@ Age 70 1,323 12,911 12,911 200,000 12,911 12,911 200,000 17,458 17,458 200,000
@ Age 85 LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED
@ Age 90 LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED
</TABLE>
* Policy lapses in policy year 31 based on guaranteed charges and a gross
investment return of 0.00%.
** Policy lapses in policy year 31 based on guaranteed charges and a gross
investment return of 0.00%.
*** Policy lapses in policy year 37 based on current charges and a gross
investment return of 0.00%.
<TABLE>
<S> <C>
APPLICANT'S OR POLICYOWNER'S I have received a copy of this illustration and understand
ACKNOWLEDGEMENT that any not-guaranteed elements are subject to change and
could be either higher or lower. The agent has told me that
they are not guaranteed.
------------------------------------------------------
Signature of Applicant or Policyowner Date
------------------------------------------------------
Signature of Applicant or Policyowner Date
REPRESENTATIVE'S I certify that this illustration has been presented to the
ACKNOWLEDGEMENT applicant and that I have explained that any not-guaranteed
elements illustrated are subject to change. I have made no
statements that are inconsistent with the illustration.
------------------------------------------------------
Signature of Representative Date
</TABLE>
Age 45 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 45 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $1,322.78-Premium Mode: Annual-Riders: None
D-4
<PAGE> 130
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
----------------------------------------------------- -------------------------
END PREMIUM 0.00% (-.75% NET) 0.00% (-.75% NET) 0.00% (-.75% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,323 1,389 0 876 200,000 0 876 200,000 0 876 200,000
2 1,323 2,847 546 1,736 200,000 546 1,736 200,000 552 1,742 200,000
3 1,323 4,379 1,523 2,581 200,000 1,523 2,581 200,000 1,539 2,597 200,000
4 1,323 5,986 2,484 3,410 200,000 2,484 3,410 200,000 2,514 3,440 200,000
5 1,323 7,675 3,428 4,221 200,000 3,428 4,221 200,000 3,479 4,272 200,000
6 1,323 9,447 4,352 5,014 200,000 4,352 5,014 200,000 4,431 5,092 200,000
7 1,323 11,309 5,256 5,785 200,000 5,256 5,785 200,000 5,370 5,899 200,000
8 1,323 13,263 6,137 6,534 200,000 6,137 6,534 200,000 6,296 6,693 200,000
9 1,323 15,315 6,992 7,256 200,000 6,992 7,256 200,000 7,206 7,471 200,000
10 1,323 17,470 7,817 7,949 200,000 7,817 7,949 200,000 8,101 8,233 200,000
11 1,323 19,732 8,863 8,863 200,000 8,863 8,863 200,000 9,229 9,229 200,000
12 1,323 22,108 9,737 9,737 200,000 9,737 9,737 200,000 10,200 10,200 200,000
13 1,323 24,602 10,566 10,566 200,000 10,566 10,566 200,000 11,141 11,141 200,000
14 1,323 27,221 11,347 11,347 200,000 11,347 11,347 200,000 12,035 12,035 200,000
15 1,323 29,971 12,072 12,072 200,000 12,072 12,072 200,000 12,867 12,867 200,000
16 1,323 32,858 12,732 12,732 200,000 12,732 12,732 200,000 13,642 13,642 200,000
17 1,323 35,890 13,317 13,317 200,000 13,317 13,317 200,000 14,353 14,353 200,000
18 1,323 39,074 13,811 13,811 200,000 13,811 13,811 200,000 14,991 14,991 200,000
19 1,323 42,416 14,195 14,195 200,000 14,195 14,195 200,000 15,555 15,555 200,000
20 1,323 45,926 14,448 14,448 200,000 14,448 14,448 200,000 16,065 16,065 200,000
21 1,323 49,611 14,549 14,549 200,000 14,549 14,549 200,000 16,527 16,527 200,000
22 1,323 53,481 14,473 14,473 200,000 14,473 14,473 200,000 16,906 16,906 200,000
23 1,323 57,544 14,196 14,196 200,000 14,196 14,196 200,000 17,186 17,186 200,000
24 1,323 61,810 13,689 13,689 200,000 13,689 13,689 200,000 17,371 17,371 200,000
25 1,323 66,289 12,911 12,911 200,000 12,911 12,911 200,000 17,458 17,458 200,000
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 0.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 45 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 45 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $1,322.78-Premium Mode: Annual-Riders: None
D-5
<PAGE> 131
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT continued
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
----------------------------------------------------- -------------------------
END PREMIUM 0.00% (-.75% NET) 0.00% (-.75% NET) 0.00% (-.75% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
26 1,323 70,992 11,807 11,807 200,000 11,807 11,807 200,000 17,425 17,425 200,000
27 1,323 75,931 10,303 10,303 200,000 10,303 10,303 200,000 17,257 17,257 200,000
28 1,323 81,116 8,300 8,300 200,000 8,300 8,300 200,000 16,930 16,930 200,000
29 1,323 86,561 5,674 5,674 200,000 5,674 5,674 200,000 16,381 16,381 200,000
30 1,323 92,278 2,288 2,288 200,000 2,288 2,288 200,000 15,569 15,569 200,000
31 1,323 98,281 LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED 14,436 14,436 200,000
32 1,323 104,584 12,919 12,919 200,000
33 1,323 111,202 10,938 10,938 200,000
34 1,323 118,151 8,397 8,397 200,000
35 1,323 125,448 5,182 5,182 200,000
36 1,323 133,109 1,154 1,154 200,000
37 1,323 141,153 LAPSED LAPSED LAPSED
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 0.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 45 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 45 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $1,322.78-Premium Mode: Annual-Riders: None
D-6
<PAGE> 132
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
<TABLE>
<S> <C>
NUMERIC SUMMARY The following table shows how differences in investment
returns and policy charges would affect policy cash value
and death benefit.
</TABLE>
<TABLE>
<CAPTION>
GUARANTEED CHARGES* GUARANTEED CHARGES** CURRENT CHARGES***
--------------------------- --------------------------- --------------------------
0.00% (-.75% NET) 6.00% (5.25% NET) 6.00% (5.25% NET)
POLICY PREMIUM CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,323 0 876 200,000 0 938 200,000 0 938 200,000
5 1,323 3,428 4,221 200,000 4,305 5,099 200,000 4,361 5,155 200,000
10 1,323 7,817 7,949 200,000 11,137 11,270 200,000 11,472 11,604 200,000
20 1,323 14,448 14,448 200,000 29,129 29,129 200,000 31,345 31,345 200,000
@ Age 70 1,323 12,911 12,911 200,000 37,182 37,182 200,000 43,076 43,076 200,000
@ Age 85 1,323 LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED 59,917 59,917 200,000
@ Age 90 1,323 LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED 7,383 7,383 200,000
</TABLE>
* Policy lapses in policy year 31 based on guaranteed charges and a gross
investment return of 0.00%.
** Policy lapses in policy year 37 based on guaranteed charges and a gross
investment return of 6.00%.
*** Policy lapses in policy year 46 based on current charges and a gross
investment return of 6.00%.
<TABLE>
<S> <C>
APPLICANT'S OR POLICYOWNER'S I have received a copy of this illustration and understand
ACKNOWLEDGEMENT that any not-guaranteed elements are subject to change and
could be either higher or lower. The agent has told me that
they are not guaranteed.
------------------------------------------------------
Signature of Applicant or Policyowner Date
------------------------------------------------------
Signature of Applicant or Policyowner Date
REPRESENTATIVE'S I certify that this illustration has been presented to the
ACKNOWLEDGEMENT applicant and that I have explained that any not-guaranteed
elements illustrated are subject to change. I have made no
statements that are inconsistent with the illustration.
------------------------------------------------------
Signature of Representative Date
</TABLE>
Age 45 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 45 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $1,322.78-Premium Mode: Annual-Riders: None
D-7
<PAGE> 133
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
--------------------------------------------------- ------------------------
END PREMIUM 0.00% (-.75% NET) 6.00% (5.25% NET) 6.00% (5.25% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,323 1,389 0 876 200,000 0 938 200,000 0 938 200,000
2 1,323 2,847 546 1,736 200,000 724 1,915 200,000 730 1,920 200,000
3 1,323 4,379 1,523 2,581 200,000 1,875 2,933 200,000 1,891 2,950 200,000
4 1,323 5,986 2,484 3,410 200,000 3,068 3,994 200,000 3,101 4,027 200,000
5 1,323 7,675 3,428 4,221 200,000 4,305 5,099 200,000 4,361 5,155 200,000
6 1,323 9,447 4,352 5,014 200,000 5,585 6,247 200,000 5,673 6,334 200,000
7 1,323 11,309 5,256 5,785 200,000 6,910 7,439 200,000 7,039 7,568 200,000
8 1,323 13,263 6,137 6,534 200,000 8,277 8,674 200,000 8,459 8,856 200,000
9 1,323 15,315 6,992 7,256 200,000 9,687 9,951 200,000 9,937 10,201 200,000
10 1,323 17,470 7,817 7,949 200,000 11,137 11,270 200,000 11,472 11,604 200,000
11 1,323 19,732 8,863 8,863 200,000 12,890 12,890 200,000 13,328 13,328 200,000
12 1,323 22,108 9,737 9,737 200,000 14,560 14,560 200,000 15,121 15,121 200,000
13 1,323 24,602 10,566 10,566 200,000 16,277 16,277 200,000 16,983 16,983 200,000
14 1,323 27,221 11,347 11,347 200,000 18,040 18,040 200,000 18,899 18,899 200,000
15 1,323 29,971 12,072 12,072 200,000 19,843 19,843 200,000 20,859 20,859 200,000
16 1,323 32,858 12,732 12,732 200,000 21,680 21,680 200,000 22,867 22,867 200,000
17 1,323 35,890 13,317 13,317 200,000 23,542 23,542 200,000 24,921 24,921 200,000
18 1,323 39,074 13,811 13,811 200,000 25,416 25,416 200,000 27,014 27,014 200,000
19 1,323 42,416 14,195 14,195 200,000 27,285 27,285 200,000 29,148 29,148 200,000
20 1,323 45,926 14,448 14,448 200,000 29,129 29,129 200,000 31,345 31,345 200,000
21 1,323 49,611 14,549 14,549 200,000 30,929 30,929 200,000 33,613 33,613 200,000
22 1,323 53,481 14,473 14,473 200,000 32,660 32,660 200,000 35,925 35,925 200,000
23 1,323 57,544 14,196 14,196 200,000 34,301 34,301 200,000 38,269 38,269 200,000
24 1,323 61,810 13,689 13,689 200,000 35,821 35,821 200,000 40,652 40,652 200,000
25 1,323 66,289 12,911 12,911 200,000 37,182 37,182 200,000 43,076 43,076 200,000
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 6.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 45 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 45 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $1,322.78-Premium Mode: Annual-Riders: None
D-8
<PAGE> 134
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT continued
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
--------------------------------------------------- ------------------------
END PREMIUM 0.00% (-.75% NET) 6.00% (5.25% NET) 6.00% (5.25% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
26 1,323 70,992 11,807 11,807 200,000 38,332 38,332 200,000 45,526 45,526 200,000
27 1,323 75,931 10,303 10,303 200,000 39,200 39,200 200,000 47,991 47,991 200,000
28 1,323 81,116 8,300 8,300 200,000 39,691 39,691 200,000 50,457 50,457 200,000
29 1,323 86,561 5,674 5,674 200,000 39,691 39,691 200,000 52,876 52,876 200,000
30 1,323 92,278 2,288 2,288 200,000 39,066 39,066 200,000 55,216 55,216 200,000
31 1,323 98,281 LAPSED LAPSED LAPSED 37,661 37,661 200,000 57,438 57,438 200,000
32 1,323 104,584 35,301 35,301 200,000 59,494 59,494 200,000
33 1,323 111,202 31,773 31,773 200,000 61,328 61,328 200,000
34 1,323 118,151 26,810 26,810 200,000 62,872 62,872 200,000
35 1,323 125,448 20,053 20,053 200,000 64,046 64,046 200,000
36 1,323 133,109 11,003 11,003 200,000 64,753 64,753 200,000
37 1,323 141,153 LAPSED LAPSED LAPSED 64,888 64,888 200,000
38 1,323 149,600 64,320 64,320 200,000
39 1,323 158,469 62,769 62,769 200,000
40 1,323 167,781 59,917 59,917 200,000
41 1,323 177,559 55,447 55,447 200,000
42 1,323 187,826 48,831 48,831 200,000
43 1,323 198,606 39,388 39,388 200,000
44 1,323 209,925 26,043 26,043 200,000
45 1,323 221,811 7,383 7,383 200,000
46 1,323 234,290 LAPSED LAPSED LAPSED
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 6.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 45 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 45 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $1,322.78-Premium Mode: Annual-Riders: None
D-9
<PAGE> 135
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
<TABLE>
<S> <C>
NUMERIC SUMMARY The following table shows how differences in investment
returns and policy charges would affect policy cash value
and death benefit.
</TABLE>
<TABLE>
<CAPTION>
GUARANTEED CHARGES* GUARANTEED CHARGES** CURRENT CHARGES***
--------------------------- ---------------------------- ----------------------------
0.00% (-.75% NET) 12.00% (11.25% NET) 12.00% (11.25% NET)
POLICY PREMIUM CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,323 0 876 200,000 0 999 200,000 0 999 200,000
5 1,323 3,428 4,221 200,000 5,336 6,130 200,000 5,398 6,191 200,000
10 1,323 7,817 7,949 200,000 15,927 16,059 200,000 16,324 16,456 200,000
20 1,323 14,448 14,448 200,000 61,553 61,553 200,000 64,679 64,679 200,000
@ Age 70 1,323 12,911 12,911 200,000 105,845 105,845 200,000 113,582 113,582 200,000
@ Age 85 1,323 LAPSED LAPSED LAPSED 508,652 508,652 534,085 563,513 563,513 591,688
@ Age 90 1,323 LAPSED LAPSED LAPSED 828,345 828,345 869,763 933,169 933,169 979,828
</TABLE>
* Policy lapses in policy year 31 based on guaranteed charges and a gross
investment return of 0.00%.
** Policy continues to age 100 based on guaranteed charges and a gross
investment return of 12.00%.
*** Policy continues to age 100 based on current charges and a gross investment
return of 12.00%.
<TABLE>
<S> <C>
APPLICANT'S OR POLICYOWNER'S I have received a copy of this illustration and understand
ACKNOWLEDGEMENT that any not-guaranteed elements are subject to change and
could be either higher or lower. The agent has told me that
they are not guaranteed.
------------------------------------------------------
Signature of Applicant or Policyowner Date
------------------------------------------------------
Signature of Applicant or Policyowner Date
REPRESENTATIVE'S I certify that this illustration has been presented to the
ACKNOWLEDGEMENT applicant and that I have explained that any not-guaranteed
elements illustrated are subject to change. I have made no
statements that are inconsistent with the illustration.
------------------------------------------------------
Signature of Representative Date
</TABLE>
Age 45 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 45 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $1,322.78-Premium Mode: Annual-Riders: None
D-10
<PAGE> 136
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
------------------------------------------------------------ ---------------------------------
END PREMIUM 0.00% (-.75% NET) 12.00% (11.25% NET) 12.00% (11.25% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,323 1,389 0 876 200,000 0 999 200,000 0 999 200,000
2 1,323 2,847 546 1,736 200,000 910 2,100 200,000 916 2,107 200,000
3 1,323 4,379 1,523 2,581 200,000 2,257 3,315 200,000 2,274 3,332 200,000
4 1,323 5,986 2,484 3,410 200,000 3,728 4,654 200,000 3,763 4,689 200,000
5 1,323 7,675 3,428 4,221 200,000 5,336 6,130 200,000 5,398 6,191 200,000
6 1,323 9,447 4,352 5,014 200,000 7,094 7,756 200,000 7,192 7,853 200,000
7 1,323 11,309 5,256 5,785 200,000 9,017 9,546 200,000 9,162 9,691 200,000
8 1,323 13,263 6,137 6,534 200,000 11,118 11,515 200,000 11,328 11,725 200,000
9 1,323 15,315 6,992 7,256 200,000 13,416 13,680 200,000 13,708 13,972 200,000
10 1,323 17,470 7,817 7,949 200,000 15,927 16,059 200,000 16,324 16,456 200,000
11 1,323 19,732 8,863 8,863 200,000 18,945 18,945 200,000 19,471 19,471 200,000
12 1,323 22,108 9,737 9,737 200,000 22,115 22,115 200,000 22,800 22,800 200,000
13 1,323 24,602 10,566 10,566 200,000 25,597 25,597 200,000 26,472 26,472 200,000
14 1,323 27,221 11,347 11,347 200,000 29,422 29,422 200,000 30,508 30,508 200,000
15 1,323 29,971 12,072 12,072 200,000 33,623 33,623 200,000 34,937 34,937 200,000
16 1,323 32,858 12,732 12,732 200,000 38,232 38,232 200,000 39,805 39,805 200,000
17 1,323 35,890 13,317 13,317 200,000 43,289 43,289 200,000 45,157 45,157 200,000
18 1,323 39,074 13,811 13,811 200,000 48,832 48,832 200,000 51,041 51,041 200,000
19 1,323 42,416 14,195 14,195 200,000 54,903 54,903 200,000 57,520 57,520 200,000
20 1,323 45,926 14,448 14,448 200,000 61,553 61,553 200,000 64,679 64,679 200,000
21 1,323 49,611 14,549 14,549 200,000 68,836 68,836 200,000 72,601 72,601 200,000
22 1,323 53,481 14,473 14,473 200,000 76,822 76,822 200,000 81,352 81,352 200,000
23 1,323 57,544 14,196 14,196 200,000 85,587 85,587 200,000 91,019 91,019 200,000
24 1,323 61,810 13,689 13,689 200,000 95,227 95,227 200,000 101,720 101,720 200,000
25 1,323 66,289 12,911 12,911 200,000 105,845 105,845 200,000 113,582 113,582 200,000
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 12.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 45 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 45 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $1,322.78-Premium Mode: Annual-Riders: None
D-11
<PAGE> 137
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT continued
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
------------------------------------------------------------ ---------------------------------
END PREMIUM 0.00% (-.75% NET) 12.00% (11.25% NET) 12.00% (11.25% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
26 1,323 70,992 11,807 11,807 200,000 117,566 117,566 200,000 126,739 126,739 200,000
27 1,323 75,931 10,303 10,303 200,000 130,537 130,537 200,000 141,352 141,352 200,000
28 1,323 81,116 8,300 8,300 200,000 144,939 144,939 200,000 157,604 157,604 200,000
29 1,323 86,561 5,674 5,674 200,000 161,005 161,005 200,000 175,706 175,706 200,000
30 1,323 92,278 2,288 2,288 200,000 179,042 179,042 200,000 195,901 195,901 209,614
31 1,323 98,281 LAPSED LAPSED LAPSED 199,406 199,406 209,376 218,335 218,335 229,252
32 1,323 104,584 222,003 222,003 233,103 243,170 243,170 255,328
33 1,323 111,202 246,953 246,953 259,300 270,654 270,654 284,186
34 1,323 118,151 274,483 274,483 288,208 301,060 301,060 316,113
35 1,323 125,448 304,840 304,840 320,083 334,686 334,686 351,421
36 1,323 133,109 338,285 338,285 355,200 371,859 371,859 390,452
37 1,323 141,153 375,094 375,094 393,848 412,933 412,933 433,579
38 1,323 149,600 415,553 415,553 436,331 458,295 458,295 481,209
39 1,323 158,469 459,967 459,967 482,966 508,345 508,345 533,762
40 1,323 167,781 508,652 508,652 534,085 563,513 563,513 591,688
41 1,323 177,559 561,942 561,942 590,039 624,272 624,272 655,485
42 1,323 187,826 620,186 620,186 651,195 691,105 691,105 725,661
43 1,323 198,606 683,749 683,749 717,937 764,525 764,525 802,752
44 1,323 209,925 753,009 753,009 790,660 845,035 845,035 887,287
45 1,323 221,811 828,345 828,345 869,763 933,169 933,169 979,828
46 1,323 234,290 910,133 910,133 955,639 1,029,472 1,029,472 1,080,946
47 1,323 247,393 1,001,198 1,001,198 1,041,246 1,136,221 1,136,221 1,181,670
48 1,323 261,152 1,103,166 1,103,166 1,136,261 1,255,059 1,255,059 1,292,711
49 1,323 275,599 1,218,081 1,218,081 1,242,443 1,388,172 1,388,172 1,415,935
50 1,323 290,767 1,348,624 1,348,624 1,362,110 1,538,085 1,538,085 1,553,466
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 12.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 45 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 45 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $1,322.78-Premium Mode: Annual-Riders: None
D-12
<PAGE> 138
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT continued
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
------------------------------------------------------------ ---------------------------------
END PREMIUM 0.00% (-.75% NET) 12.00% (11.25% NET) 12.00% (11.25% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
51 1,323 306,695 1,492,374 1,492,374 1,507,298 1,703,795 1,703,795 1,720,833
52 1,323 323,418 1,650,054 1,650,054 1,666,555 1,886,851 1,886,851 1,905,720
53 1,323 340,978 1,821,428 1,821,428 1,839,642 2,089,117 2,089,117 2,110,009
54 1,323 359,416 2,007,836 2,007,836 2,027,914 2,312,558 2,312,558 2,335,684
55 1,323 378,776 2,213,192 2,213,192 2,235,324 2,559,344 2,559,344 2,584,937
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 12.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 45 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 45 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $1,322.78-Premium Mode: Annual-Riders: None
D-13
<PAGE> 139
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
<TABLE>
<S> <C>
NUMERIC SUMMARY The following table shows how differences in investment
returns and policy charges would affect policy cash value
and death benefit.
</TABLE>
<TABLE>
<CAPTION>
GUARANTEED CHARGES* GUARANTEED CHARGES** CURRENT CHARGES***
--------------------------- --------------------------- ---------------------------
0.00% (-.75% NET) 0.00% (-.75% NET) 0.00% (-.75% NET)
POLICY PREMIUM CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,932 0 1,419 200,000 0 1,419 200,000 0 1,419 200,000
5 1,932 5,593 6,752 200,000 5,593 6,752 200,000 5,673 6,833 200,000
10 1,932 12,196 12,389 200,000 12,196 12,389 200,000 12,536 12,730 200,000
20 1,932 18,908 18,908 200,000 18,908 18,908 200,000 20,182 20,182 200,000
@ Age 70 1,932 13,304 13,304 200,000 13,304 13,304 200,000 17,644 17,644 200,000
@ Age 85 LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED
@ Age 90 LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED
</TABLE>
* Policy lapses in policy year 29 based on guaranteed charges and a gross
investment return of 0.00%.
** Policy lapses in policy year 29 based on guaranteed charges and a gross
investment return of 0.00%.
*** Policy lapses in policy year 32 based on current charges and a gross
investment return of 0.00%.
<TABLE>
<S> <C>
APPLICANT'S OR POLICYOWNER'S I have received a copy of this illustration and understand
ACKNOWLEDGEMENT that any not-guaranteed elements are subject to change and
could be either higher or lower. The agent has told me that
they are not guaranteed.
------------------------------------------------------
Signature of Applicant or Policyowner Date
------------------------------------------------------
Signature of Applicant or Policyowner Date
REPRESENTATIVE'S I certify that this illustration has been presented to the
ACKNOWLEDGEMENT applicant and that I have explained that any not-guaranteed
elements illustrated are subject to change. I have made no
statements that are inconsistent with the illustration.
------------------------------------------------------
Signature of Representative Date
</TABLE>
Age 45 Male Smoker Standard Prepared On: 09/11/1998
Age 45 Female Smoker Standard Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $1,932.08-Premium Mode: Annual-Riders: None
D-14
<PAGE> 140
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
----------------------------------------------------- -------------------------
END PREMIUM 0.00% (-.75% NET) 0.00% (-.75% NET) 0.00% (-.75% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,932 2,029 0 1,419 200,000 0 1,419 200,000 0 1,419 200,000
2 1,932 4,159 1,064 2,803 200,000 1,064 2,803 200,000 1,077 2,815 200,000
3 1,932 6,395 2,610 4,156 200,000 2,610 4,156 200,000 2,640 4,186 200,000
4 1,932 8,744 4,121 5,473 200,000 4,121 5,473 200,000 4,174 5,526 200,000
5 1,932 11,210 5,593 6,752 200,000 5,593 6,752 200,000 5,673 6,833 200,000
6 1,932 13,799 7,023 7,989 200,000 7,023 7,989 200,000 7,136 8,102 200,000
7 1,932 16,518 8,404 9,177 200,000 8,404 9,177 200,000 8,558 9,331 200,000
8 1,932 19,372 9,732 10,312 200,000 9,732 10,312 200,000 9,936 10,515 200,000
9 1,932 22,369 10,999 11,385 200,000 10,999 11,385 200,000 11,264 11,650 200,000
10 1,932 25,517 12,196 12,389 200,000 12,196 12,389 200,000 12,536 12,730 200,000
11 1,932 28,821 13,587 13,587 200,000 13,587 13,587 200,000 14,009 14,009 200,000
12 1,932 32,291 14,698 14,698 200,000 14,698 14,698 200,000 15,207 15,207 200,000
13 1,932 35,934 15,712 15,712 200,000 15,712 15,712 200,000 16,309 16,309 200,000
14 1,932 39,759 16,623 16,623 200,000 16,623 16,623 200,000 17,286 17,286 200,000
15 1,932 43,776 17,418 17,418 200,000 17,418 17,418 200,000 18,148 18,148 200,000
16 1,932 47,994 18,083 18,083 200,000 18,083 18,083 200,000 18,881 18,881 200,000
17 1,932 52,422 18,596 18,596 200,000 18,596 18,596 200,000 19,464 19,464 200,000
18 1,932 57,072 18,927 18,927 200,000 18,927 18,927 200,000 19,878 19,878 200,000
19 1,932 61,954 19,042 19,042 200,000 19,042 19,042 200,000 20,122 20,122 200,000
20 1,932 67,080 18,908 18,908 200,000 18,908 18,908 200,000 20,182 20,182 200,000
21 1,932 72,463 18,489 18,489 200,000 18,489 18,489 200,000 20,134 20,134 200,000
22 1,932 78,115 17,753 17,753 200,000 17,753 17,753 200,000 19,851 19,851 200,000
23 1,932 84,049 16,670 16,670 200,000 16,670 16,670 200,000 19,349 19,349 200,000
24 1,932 90,280 15,205 15,205 200,000 15,205 15,205 200,000 18,622 18,622 200,000
25 1,932 96,823 13,304 13,304 200,000 13,304 13,304 200,000 17,644 17,644 200,000
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 0.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 45 Male Smoker Standard Prepared On: 09/11/1998
Age 45 Female Smoker Standard Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $1,932.08-Premium Mode: Annual-Riders: None
D-15
<PAGE> 141
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT continued
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
----------------------------------------------------- -------------------------
END PREMIUM 0.00% (-.75% NET) 0.00% (-.75% NET) 0.00% (-.75% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
26 1,932 103,693 10,888 10,888 200,000 10,888 10,888 200,000 16,361 16,361 200,000
27 1,932 110,906 7,843 7,843 200,000 7,843 7,843 200,000 14,769 14,769 200,000
28 1,932 118,480 4,022 4,022 200,000 4,022 4,022 200,000 12,813 12,813 200,000
29 1,932 126,433 LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED 10,336 10,336 200,000
30 1,932 134,783 7,237 7,237 200,000
31 1,932 143,551 3,407 3,407 200,000
32 1,932 152,757 LAPSED LAPSED LAPSED
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 0.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 45 Male Smoker Standard Prepared On: 09/11/1998
Age 45 Female Smoker Standard Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $1,932.08-Premium Mode: Annual-Riders: None
D-16
<PAGE> 142
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
<TABLE>
<S> <C>
NUMERIC SUMMARY The following table shows how differences in investment
returns and policy charges would affect policy cash value
and death benefit.
</TABLE>
<TABLE>
<CAPTION>
GUARANTEED CHARGES* GUARANTEED CHARGES** CURRENT CHARGES***
-------------------------- -------------------------- --------------------------
0.00% (-.75% NET) 6.00% (5.25% NET) 6.00% (5.25% NET)
POLICY PREMIUM CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,932 0 1,419 200,000 0 1,513 200,000 0 1,513 200,000
5 1,932 5,593 6,752 200,000 6,978 8,137 200,000 7,066 8,226 200,000
10 1,932 12,196 12,389 200,000 17,429 17,623 200,000 17,837 18,031 200,000
20 1,932 18,908 18,908 200,000 41,265 41,265 200,000 43,114 43,114 200,000
@ Age 70 1,932 13,304 13,304 200,000 49,957 49,957 200,000 55,342 55,342 200,000
@ Age 85 1,932 LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED 30,895 30,895 200,000
@ Age 90 LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED
</TABLE>
* Policy lapses in policy year 29 based on guaranteed charges and a gross
investment return of 0.00%.
** Policy lapses in policy year 37 based on guaranteed charges and a gross
investment return of 6.00%.
*** Policy lapses in policy year 42 based on current charges and a gross
investment return of 6.00%.
<TABLE>
<S> <C>
APPLICANT'S OR POLICYOWNER'S I have received a copy of this illustration and understand
ACKNOWLEDGEMENT that any not-guaranteed elements are subject to change and
could be either higher or lower. The agent has told me that
they are not guaranteed.
------------------------------------------------------
Signature of Applicant or Policyowner Date
------------------------------------------------------
Signature of Applicant or Policyowner Date
REPRESENTATIVE'S I certify that this illustration has been presented to the
ACKNOWLEDGEMENT applicant and that I have explained that any not-guaranteed
elements illustrated are subject to change. I have made no
statements that are inconsistent with the illustration.
------------------------------------------------------
Signature of Representative Date
</TABLE>
Age 45 Male Smoker Standard Prepared On: 09/11/1998
Age 45 Female Smoker Standard Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $1,932.08-Premium Mode: Annual-Riders: None
D-17
<PAGE> 143
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
----------------------------------------------------- -------------------------
END PREMIUM 0.00% (-.75% NET) 6.00% (5.25% NET) 6.00% (5.25% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,932 2,029 0 1,419 200,000 0 1,513 200,000 0 1,513 200,000
2 1,932 4,159 1,064 2,803 200,000 1,342 3,081 200,000 1,354 3,093 200,000
3 1,932 6,395 2,610 4,156 200,000 3,162 4,708 200,000 3,194 4,740 200,000
4 1,932 8,744 4,121 5,473 200,000 5,041 6,394 200,000 5,098 6,451 200,000
5 1,932 11,210 5,593 6,752 200,000 6,978 8,137 200,000 7,066 8,226 200,000
6 1,932 13,799 7,023 7,989 200,000 8,970 9,936 200,000 9,098 10,064 200,000
7 1,932 16,518 8,404 9,177 200,000 11,016 11,789 200,000 11,193 11,966 200,000
8 1,932 19,372 9,732 10,312 200,000 13,112 13,692 200,000 13,349 13,929 200,000
9 1,932 22,369 10,999 11,385 200,000 15,251 15,638 200,000 15,565 15,952 200,000
10 1,932 25,517 12,196 12,389 200,000 17,429 17,623 200,000 17,837 18,031 200,000
11 1,932 28,821 13,587 13,587 200,000 19,922 19,922 200,000 20,435 20,435 200,000
12 1,932 32,291 14,698 14,698 200,000 22,262 22,262 200,000 22,891 22,891 200,000
13 1,932 35,934 15,712 15,712 200,000 24,636 24,636 200,000 25,389 25,389 200,000
14 1,932 39,759 16,623 16,623 200,000 27,040 27,040 200,000 27,901 27,901 200,000
15 1,932 43,776 17,418 17,418 200,000 29,465 29,465 200,000 30,441 30,441 200,000
16 1,932 47,994 18,083 18,083 200,000 31,899 31,899 200,000 32,996 32,996 200,000
17 1,932 52,422 18,596 18,596 200,000 34,323 34,323 200,000 35,551 35,551 200,000
18 1,932 57,072 18,927 18,927 200,000 36,712 36,712 200,000 38,090 38,090 200,000
19 1,932 61,954 19,042 19,042 200,000 39,036 39,036 200,000 40,614 40,614 200,000
20 1,932 67,080 18,908 18,908 200,000 41,265 41,265 200,000 43,114 43,114 200,000
21 1,932 72,463 18,489 18,489 200,000 43,369 43,369 200,000 45,660 45,660 200,000
22 1,932 78,115 17,753 17,753 200,000 45,318 45,318 200,000 48,147 48,147 200,000
23 1,932 84,049 16,670 16,670 200,000 47,090 47,090 200,000 50,593 50,593 200,000
24 1,932 90,280 15,205 15,205 200,000 48,651 48,651 200,000 52,996 52,996 200,000
25 1,932 96,823 13,304 13,304 200,000 49,957 49,957 200,000 55,342 55,342 200,000
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 6.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 45 Male Smoker Standard Prepared On: 09/11/1998
Age 45 Female Smoker Standard Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $1,932.08-Premium Mode: Annual-Riders: None
D-18
<PAGE> 144
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT continued
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
----------------------------------------------------- -------------------------
END PREMIUM 0.00% (-.75% NET) 6.00% (5.25% NET) 6.00% (5.25% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
26 1,932 103,693 10,888 10,888 200,000 50,943 50,943 200,000 57,593 57,593 200,000
27 1,932 110,906 7,843 7,843 200,000 51,513 51,513 200,000 59,750 59,750 200,000
28 1,932 118,480 4,022 4,022 200,000 51,547 51,547 200,000 61,779 61,779 200,000
29 1,932 126,433 LAPSED LAPSED LAPSED 50,899 50,899 200,000 63,567 63,567 200,000
30 1,932 134,783 49,397 49,397 200,000 65,050 65,050 200,000
31 1,932 143,551 46,848 46,848 200,000 66,154 66,154 200,000
32 1,932 152,757 43,035 43,035 200,000 66,773 66,773 200,000
33 1,932 162,424 37,705 37,705 200,000 66,783 66,783 200,000
34 1,932 172,574 30,529 30,529 200,000 66,034 66,034 200,000
35 1,932 183,281 21,055 21,055 200,000 64,347 64,347 200,000
36 1,932 194,421 8,651 8,651 200,000 61,529 61,529 200,000
37 1,932 206,171 LAPSED LAPSED LAPSED 57,284 57,284 200,000
38 1,932 218,508 51,265 51,265 200,000
39 1,932 231,463 42,765 42,765 200,000
40 1,932 245,064 30,895 30,895 200,000
41 1,932 259,346 14,791 14,791 200,000
42 1,932 274,342 LAPSED LAPSED LAPSED
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 6.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 45 Male Smoker Standard Prepared On: 09/11/1998
Age 45 Female Smoker Standard Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $1,932.08-Premium Mode: Annual-Riders: None
D-19
<PAGE> 145
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
<TABLE>
<S> <C>
NUMERIC SUMMARY The following table shows how differences in investment
returns and policy charges would affect policy cash value
and death benefit.
</TABLE>
<TABLE>
<CAPTION>
GUARANTEED CHARGES* GUARANTEED CHARGES** CURRENT CHARGES***
-------------------------- --------------------------------- ---------------------------------
0.00% (-.75% NET) 12.00% (11.25% NET) 12.00% (11.25% NET)
POLICY PREMIUM CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,932 0 1,419 200,000 0 1,608 200,000 0 1,608 200,000
5 1,932 5,593 6,752 200,000 8,603 9,762 200,000 8,701 9,860 200,000
10 1,932 12,196 12,389 200,000 24,984 25,178 200,000 25,476 25,669 200,000
20 1,932 18,908 18,908 200,000 91,845 91,845 200,000 94,631 94,631 200,000
@ Age 70 1,932 13,304 13,304 200,000 158,601 158,601 200,000 165,137 165,137 200,000
@ Age 85 1,932 LAPSED LAPSED LAPSED 768,788 768,788 807,228 811,134 811,134 851,691
@ Age 90 1,932 LAPSED LAPSED LAPSED 1,246,739 1,246,739 1,309,076 1,326,609 1,326,609 1,392,939
</TABLE>
* Policy lapses in policy year 29 based on guaranteed charges and a gross
investment return of 0.00%.
** Policy continues to age 100 based on guaranteed charges and a gross
investment return of 12.00%.
*** Policy continues to age 100 based on current charges and a gross investment
return of 12.00%.
<TABLE>
<S> <C>
APPLICANT'S OR POLICYOWNER'S I have received a copy of this illustration and understand
ACKNOWLEDGEMENT that any not-guaranteed elements are subject to change and
could be either higher or lower. The agent has told me that
they are not guaranteed.
------------------------------------------------------
Signature of Applicant or Policyowner Date
------------------------------------------------------
Signature of Applicant or Policyowner Date
REPRESENTATIVE'S I certify that this illustration has been presented to the
ACKNOWLEDGEMENT applicant and that I have explained that any not-guaranteed
elements illustrated are subject to change. I have made no
statements that are inconsistent with the illustration.
------------------------------------------------------
Signature of Representative Date
</TABLE>
Age 45 Male Smoker Standard Prepared On: 09/11/1998
Age 45 Female Smoker Standard Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $1,932.08-Premium Mode: Annual-Riders: None
D-20
<PAGE> 146
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
--------------------------------------------------------- -----------------------------
END PREMIUM 0.00% (-.75% NET) 12.00% (11.25% NET) 12.00% (11.25% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,932 2,029 0 1,419 200,000 0 1,608 200,000 0 1,608 200,000
2 1,932 4,159 1,064 2,803 200,000 1,631 3,370 200,000 1,644 3,383 200,000
3 1,932 6,395 2,610 4,156 200,000 3,760 5,306 200,000 3,794 5,340 200,000
4 1,932 8,744 4,121 5,473 200,000 6,079 7,431 200,000 6,140 7,493 200,000
5 1,932 11,210 5,593 6,752 200,000 8,603 9,762 200,000 8,701 9,860 200,000
6 1,932 13,799 7,023 7,989 200,000 11,351 12,317 200,000 11,495 12,461 200,000
7 1,932 16,518 8,404 9,177 200,000 14,342 15,115 200,000 14,544 15,317 200,000
8 1,932 19,372 9,732 10,312 200,000 17,596 18,176 200,000 17,874 18,453 200,000
9 1,932 22,369 10,999 11,385 200,000 21,136 21,522 200,000 21,508 21,895 200,000
10 1,932 25,517 12,196 12,289 200,000 24,984 25,178 200,000 25,476 25,669 200,000
11 1,932 28,821 13,587 13,587 200,000 29,462 29,462 200,000 30,091 30,091 200,000
12 1,932 32,291 14,698 14,698 200,000 34,148 34,148 200,000 34,933 34,933 200,000
13 1,932 35,934 15,712 15,712 200,000 39,273 39,273 200,000 40,232 40,232 200,000
14 1,932 39,759 16,623 16,623 200,000 44,883 44,883 200,000 46,015 46,015 200,000
15 1,932 43,776 17,418 17,418 200,000 51,028 51,028 200,000 52,350 52,350 200,000
16 1,932 47,994 18,083 18,083 200,000 57,761 57,761 200,000 59,295 59,295 200,000
17 1,932 52,422 18,596 18,596 200,000 65,140 65,140 200,000 66,911 66,911 200,000
18 1,932 57,072 18,927 18,927 200,000 73,229 73,229 200,000 75,271 75,271 200,000
19 1,932 61,954 19,042 19,042 200,000 82,100 82,100 200,000 84,475 84,475 200,000
20 1,932 67,080 18,908 18,908 200,000 91,845 91,845 200,000 94,631 94,631 200,000
21 1,932 72,463 18,489 18,489 200,000 102,576 102,576 200,000 105,916 105,916 200,000
22 1,932 78,115 17,753 17,753 200,000 114,429 114,429 200,000 118,412 118,412 200,000
23 1,932 84,049 16,670 16,670 200,000 127,577 127,577 200,000 132,308 132,308 200,000
24 1,932 90,280 15,205 15,205 200,000 142,220 142,220 200,000 147,805 147,805 200,000
25 1,932 96,823 13,304 13,304 200,000 158,601 158,601 200,000 165,137 165,137 200,000
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 12.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 45 Male Smoker Standard Prepared On: 09/11/1998
Age 45 Female Smoker Standard Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $1,932.08-Premium Mode: Annual-Riders: None
D-21
<PAGE> 147
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT continued
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
----------------------------------------------------------- ---------------------------------
END PREMIUM 0.00% (-.75% NET) 12.00% (11.25% NET) 12.00% (11.25% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
26 1,932 103,693 10,888 10,888 200,000 177,010 177,010 203,562 184,526 184,526 212,205
27 1,932 110,906 7,843 7,843 200,000 197,525 197,525 223,203 206,026 206,026 232,809
28 1,932 118,480 4,022 4,022 200,000 220,217 220,217 244,441 229,842 229,842 255,124
29 1,932 126,433 LAPSED LAPSED LAPSED 245,343 245,343 267,424 256,229 256,229 279,289
30 1,932 134,783 273,204 273,204 292,329 285,492 285,492 305,476
31 1,932 143,551 304,163 304,163 319,372 317,985 317,985 333,884
32 1,932 152,757 338,316 338,316 355,232 353,892 353,892 371,587
33 1,932 162,424 375,973 375,973 394,771 393,552 393,552 413,230
34 1,932 172,574 417,469 417,469 438,342 437,332 437,332 459,199
35 1,932 183,231 463,165 463,165 486,323 485,631 485,631 509,913
36 1,932 194,421 513,444 513,444 539,117 538,887 538,887 565,831
37 1,932 206,171 568,712 568,712 597,148 597,563 597,563 627,442
38 1,932 218,508 629,394 629,394 660,863 662,165 662,165 695,273
39 1,932 231,463 695,927 695,927 730,724 733,182 733,182 769,841
40 1,932 245,064 768,788 768,788 807,228 811,134 811,134 851,691
41 1,932 259,346 848,483 848,483 890,907 896,638 896,638 941,470
42 1,932 274,342 935,549 935,549 982,327 990,242 990,242 1,039,754
43 1,932 290,088 1,030,553 1,030,553 1,082,081 1,092,691 1,092,691 1,147,326
44 1,932 306,621 1,134,078 1,134,078 1,190,782 1,204,585 1,204,585 1,264,814
45 1,932 323,981 1,246,739 1,246,739 1,309,076 1,326,609 1,326,609 1,392,939
46 1,932 342,209 1,369,104 1,369,104 1,437,559 1,459,602 1,459,602 1,532,582
47 1,932 361,348 1,505,603 1,505,603 1,565,827 1,607,612 1,607,612 1,671,917
48 1,932 381,444 1,658,671 1,658,671 1,708,432 1,773,174 1,773,174 1,826,370
49 1,932 402,545 1,831,347 1,831,347 1,867,974 1,959,662 1,959,662 1,998,855
50 1,932 424,700 2,027,591 2,027,591 2,047,866 2,170,759 2,170,759 2,192,467
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 12.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 45 Male Smoker Standard Prepared On: 09/11/1998
Age 45 Female Smoker Standard Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $1,932.08-Premium Mode: Annual-Riders: None
D-22
<PAGE> 148
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT continued
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
----------------------------------------------------------- ---------------------------------
END PREMIUM 0.00% (-.75% NET) 12.00% (11.25% NET) 12.00% (11.25% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
51 1,932 447,964 2,243,695 2,243,695 2,266,131 2,404,174 2,404,174 2,428,216
52 1,932 472,391 2,480,740 2,480,740 2,505,547 2,662,241 2,662,241 2,688,863
53 1,932 498,039 2,738,370 2,738,370 2,765,754 2,947,523 2,947,523 2,976,998
54 1,932 524,970 3,018,609 3,018,609 3,048,795 3,262,832 3,262,832 3,295,460
55 1,932 553,247 3,327,334 3,327,334 3,360,607 3,611,251 3,611,251 3,647,364
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 12.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 45 Male Smoker Standard Prepared On: 09/11/1998
Age 45 Female Smoker Standard Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $1,932.08-Premium Mode: Annual-Riders: None
D-23
<PAGE> 149
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
<TABLE>
<S> <C>
NUMERIC SUMMARY The following table shows how differences in investment
returns and policy charges would affect policy cash value
and death benefit.
</TABLE>
<TABLE>
<CAPTION>
GUARANTEED CHARGES* GUARANTEED CHARGES** CURRENT CHARGES***
-------------------------- -------------------------- --------------------------
0.00% (-.75% NET) 0.00% (-.75% NET) 0.00% (-.75% NET)
POLICY PREMIUM CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,323 0 876 200,876 0 876 200,876 0 876 200,876
5 1,323 3,426 4,220 204,220 3,426 4,220 204,220 3,478 4,272 204,272
10 1,323 7,803 7,936 207,936 7,803 7,936 207,936 8,096 8,229 208,229
20 1,323 14,189 14,189 214,189 14,189 14,189 214,189 15,897 15,897 215,897
@ Age 70 1,323 12,166 12,166 212,166 12,166 12,166 212,166 16,981 16,981 216,981
@ Age 85 LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED
@ Age 90 LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED
</TABLE>
* Policy lapses in policy year 31 based on guaranteed charges and a gross
investment return of 0.00%.
** Policy lapses in policy year 31 based on guaranteed charges and a gross
investment return of 0.00%.
*** Policy lapses in policy year 36 based on current charges and a gross
investment return of 0.00%.
<TABLE>
<S> <C>
APPLICANT'S OR POLICYOWNER'S I have received a copy of this illustration and understand
ACKNOWLEDGEMENT that any not-guaranteed elements are subject to change and
could be either higher or lower. The agent has told me that
they are not guaranteed.
------------------------------------------------------
Signature of Applicant or Policyowner Date
------------------------------------------------------
Signature of Applicant or Policyowner Date
REPRESENTATIVE'S I certify that this illustration has been presented to the
ACKNOWLEDGEMENT applicant and that I have explained that any not-guaranteed
elements illustrated are subject to change. I have made no
statements that are inconsistent with the illustration.
------------------------------------------------------
Signature of Representative Date
</TABLE>
Age 45 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 45 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $1,322.78-Premium Mode: Annual-Riders: None
D-24
<PAGE> 150
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
----------------------------------------------------- -------------------------
END PREMIUM 0.00% (-.75% NET) 0.00% (-.75% NET) 0.00% (-.75% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,323 1,389 0 876 200,876 0 876 200,876 0 876 200,876
2 1,323 2,847 546 1,736 201,736 546 1,736 201,736 552 1,742 201,742
3 1,323 4,379 1,523 2,581 202,581 1,523 2,581 202,581 1,539 2,597 202,597
4 1,323 5,986 2,483 3,409 203,409 2,483 3,409 203,409 2,514 3,440 203,440
5 1,323 7,675 3,426 4,220 204,220 3,426 4,220 204,220 3,478 4,272 204,272
6 1,323 9,447 4,350 5,011 205,011 4,350 5,011 205,011 4,430 5,092 205,092
7 1,323 11,309 5,253 5,782 205,782 5,253 5,782 205,782 5,369 5,898 205,898
8 1,323 13,263 6,131 6,528 206,528 6,131 6,528 206,528 6,294 6,691 206,691
9 1,323 15,315 6,983 7,247 207,247 6,983 7,247 207,247 7,204 7,468 207,468
10 1,323 17,470 7,803 7,936 207,936 7,803 7,936 207,936 8,096 8,229 208,229
11 1,323 19,732 8,843 8,843 208,843 8,843 8,843 208,843 9,223 9,223 209,223
12 1,323 22,108 9,709 9,709 209,709 9,709 9,709 209,709 10,191 10,191 210,191
13 1,323 24,602 10,528 10,528 210,528 10,528 10,528 210,528 11,128 11,128 211,128
14 1,323 27,221 11,295 11,295 211,295 11,295 11,295 211,295 12,014 12,014 212,014
15 1,323 29,971 12,002 12,002 212,002 12,002 12,002 212,002 12,835 12,835 212,835
16 1,323 32,858 12,639 12,639 212,639 12,639 12,639 212,639 13,594 13,594 213,594
17 1,323 35,890 13,195 13,195 213,195 13,195 13,195 213,195 14,284 14,284 214,284
18 1,323 39,074 13,653 13,653 213,653 13,653 13,653 213,653 14,895 14,895 214,895
19 1,323 42,416 13,992 13,992 213,992 13,992 13,992 213,992 15,425 15,425 215,425
20 1,323 45,926 14,189 14,189 214,189 14,189 14,189 214,189 15,897 15,897 215,897
21 1,323 49,611 14,221 14,221 214,221 14,221 14,221 214,221 16,315 16,315 216,315
22 1,323 53,481 14,063 14,063 214,063 14,063 14,063 214,063 16,642 16,642 216,642
23 1,323 57,544 13,689 13,689 213,689 13,689 13,689 213,689 16,860 16,860 216,860
24 1,323 61,810 13,070 13,070 213,070 13,070 13,070 213,070 16,974 16,974 216,974
25 1,323 66,289 12,166 12,166 212,166 12,166 12,166 212,166 16,981 16,981 216,981
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 0.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 45 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 45 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $1,322.78-Premium Mode: Annual-Riders: None
D-25
<PAGE> 151
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT continued
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
----------------------------------------------------- -------------------------
END PREMIUM 0.00% (-.75% NET) 0.00% (-.75% NET) 0.00% (-.75% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
26 1,323 70,992 10,924 10,924 210,924 10,924 10,924 210,924 16,856 16,856 216,856
27 1,323 75,931 9,273 9,273 209,273 9,273 9,273 209,273 16,585 16,585 216,585
28 1,323 81,116 7,121 7,121 207,121 7,121 7,121 207,121 16,141 16,141 216,141
29 1,323 86,561 4,361 4,361 204,361 4,361 4,361 204,361 15,459 15,459 215,459
30 1,323 92,278 879 879 200,879 879 879 200,879 14,496 14,496 214,496
31 1,323 98,281 LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED 13,197 13,197 213,197
32 1,323 104,584 11,500 11,500 211,500
33 1,323 111,202 9,334 9,334 209,334
34 1,323 118,151 6,614 6,614 206,614
35 1,323 125,448 3,251 3,251 203,251
36 1,323 133,109 LAPSED LAPSED LAPSED
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 0.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 45 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 45 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $1,322.78-Premium Mode: Annual-Riders: None
D-26
<PAGE> 152
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
<TABLE>
<S> <C>
NUMERIC SUMMARY The following table shows how differences in investment
returns and policy charges would affect policy cash value
and death benefit.
</TABLE>
<TABLE>
<CAPTION>
GUARANTEED CHARGES* GUARANTEED CHARGES** CURRENT CHARGES***
-------------------------- -------------------------- --------------------------
0.00% (-.75% NET) 6.00% (5.25% NET) 6.00% (5.25% NET)
POLICY PREMIUM CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,323 0 876 200,876 0 938 200,938 0 938 200,938
5 1,323 3,426 4,220 204,220 4,304 5,097 205,097 4,361 5,154 205,154
10 1,323 7,803 7,936 207,936 11,118 11,250 211,250 11,466 11,598 211,598
20 1,323 14,189 14,189 214,189 28,580 28,580 228,580 30,999 30,999 230,999
@ Age 70 1,323 12,166 12,166 212,166 35,153 35,153 235,153 41,853 41,853 241,853
@ Age 85 1,323 LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED 33,741 33,741 233,741
@ Age 90 LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED
</TABLE>
* Policy lapses in policy year 31 based on guaranteed charges and a gross
investment return of 0.00%.
** Policy lapses in policy year 36 based on guaranteed charges and a gross
investment return of 6.00%.
*** Policy lapses in policy year 43 based on current charges and a gross
investment return of 6.00%.
<TABLE>
<S> <C>
APPLICANT'S OR POLICYOWNER'S I have received a copy of this illustration and understand
ACKNOWLEDGEMENT that any not-guaranteed elements are subject to change and
could be either higher or lower. The agent has told me that
they are not guaranteed.
------------------------------------------------------
Signature of Applicant or Policyowner Date
------------------------------------------------------
Signature of Applicant or Policyowner Date
REPRESENTATIVE'S I certify that this illustration has been presented to the
ACKNOWLEDGEMENT applicant and that I have explained that any not-guaranteed
elements illustrated are subject to change. I have made no
statements that are inconsistent with the illustration.
------------------------------------------------------
Signature of Representative Date
</TABLE>
Age 45 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 45 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
2 Form # B1-98
Initial Modal Premium: $1,322.78-Premium Mode: Annual-Riders: None
D-27
<PAGE> 153
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
----------------------------------------------------- -------------------------
END PREMIUM 0.00% (-.75% NET) 6.00% (5.25% NET) 6.00% (5.25% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,323 1,389 0 876 200,876 0 938 200,938 0 938 200,938
2 1,323 2,847 546 1,736 201,736 724 1,914 201,914 730 1,920 201,920
3 1,323 4,379 1,523 2,581 202,581 1,875 2,933 202,933 1,891 2,950 202,950
4 1,323 5,986 2,483 3,409 203,409 3,068 3,993 203,993 3,101 4,027 204,027
5 1,323 7,675 3,426 4,220 204,220 4,304 5,097 205,097 4,361 5,154 205,154
6 1,323 9,447 4,350 5,011 205,011 5,583 6,244 206,244 5,672 6,334 206,334
7 1,323 11,309 5,253 5,782 205,782 6,905 7,434 207,434 7,037 7,566 207,566
8 1,323 13,263 6,131 6,528 206,528 8,269 8,666 208,666 8,457 8,854 208,854
9 1,323 15,315 6,983 7,247 207,247 9,674 9,939 209,939 9,933 10,198 210,198
10 1,323 17,470 7,803 7,936 207,936 11,118 11,250 211,250 11,466 11,598 211,598
11 1,323 19,732 8,843 8,843 208,843 12,860 12,860 212,860 13,319 13,319 213,319
12 1,323 22,108 9,709 9,709 209,709 14,516 14,516 214,516 15,107 15,107 215,107
13 1,323 24,602 10,528 10,528 210,528 16,215 16,215 216,215 16,961 16,961 216,961
14 1,323 27,221 11,295 11,295 211,295 17,951 17,951 217,951 18,864 18,864 218,864
15 1,323 29,971 12,002 12,002 212,002 19,720 19,720 219,720 20,803 20,803 220,803
16 1,323 32,858 12,639 12,639 212,639 21,511 21,511 221,511 22,782 22,782 222,782
17 1,323 35,890 13,195 13,195 213,195 23,313 23,313 223,313 24,795 24,795 224,795
18 1,323 39,074 13,653 13,653 213,653 25,107 25,107 225,107 26,832 26,832 226,832
19 1,323 42,416 13,992 13,992 213,992 26,871 26,871 226,871 28,893 28,893 228,893
20 1,323 45,926 14,189 14,189 214,189 28,580 28,580 228,580 30,999 30,999 230,999
21 1,323 49,611 14,221 14,221 214,221 30,203 30,203 230,203 33,159 33,159 233,159
22 1,323 53,481 14,063 14,063 214,063 31,710 31,710 231,710 35,335 35,335 235,335
23 1,323 57,544 13,689 13,689 213,689 33,067 33,067 233,067 37,508 37,508 237,508
24 1,323 61,810 13,070 13,070 213,070 34,232 34,232 234,232 39,682 39,682 239,682
25 1,323 66,289 12,166 12,166 212,166 35,153 35,153 235,153 41,853 41,853 241,853
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 6.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 45 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 45 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
2 Form # B1-98
Initial Modal Premium: $1,322.78-Premium Mode: Annual-Riders: None
D-28
<PAGE> 154
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT continued
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
----------------------------------------------------- -------------------------
END PREMIUM 0.00% (-.75% NET) 6.00% (5.25% NET) 6.00% (5.25% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
26 1,323 70,992 10,924 10,924 210,924 35,760 35,760 235,760 43,995 43,995 243,995
27 1,323 75,931 9,273 9,273 209,273 35,961 35,961 235,961 46,089 46,089 246,089
28 1,323 81,116 7,121 7,121 207,121 35,636 35,636 235,636 48,103 48,103 248,103
29 1,323 86,561 4,361 4,361 204,361 34,643 34,643 234,643 49,966 49,966 249,966
30 1,323 92,278 879 879 200,879 32,826 32,826 232,826 51,622 51,622 251,622
31 1,323 98,281 LAPSED LAPSED LAPSED 30,017 30,017 230,017 53,001 53,001 253,001
32 1,323 104,584 26,044 26,044 226,044 54,023 54,023 254,023
33 1,323 111,202 20,721 20,721 220,721 54,591 54,591 254,591
34 1,323 118,151 13,842 13,842 213,842 54,592 54,592 254,592
35 1,323 125,448 5,156 5,156 205,156 53,899 53,899 253,899
36 1,323 133,109 LAPSED LAPSED LAPSED 52,361 52,361 252,361
37 1,323 141,153 49,827 49,827 249,827
38 1,323 149,600 46,123 46,123 246,123
39 1,323 158,469 40,883 40,883 240,883
40 1,323 167,781 33,741 33,741 233,741
41 1,323 177,559 24,417 24,417 224,417
42 1,323 187,826 12,460 12,460 212,460
43 1,323 198,606 LAPSED LAPSED LAPSED
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 6.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 45 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 45 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
2 Form # B1-98
Initial Modal Premium: $1,322.78-Premium Mode: Annual-Riders: None
D-29
<PAGE> 155
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
<TABLE>
<S> <C>
NUMERIC SUMMARY The following table shows how differences in investment
returns and policy charges would affect policy cash value
and death benefit.
</TABLE>
<TABLE>
<CAPTION>
GUARANTEED CHARGES* GUARANTEED CHARGES** CURRENT CHARGES***
-------------------------- ---------------------------- ----------------------------
0.00% (-.75% NET) 12.00% (11.25% NET) 12.00% (11.25% NET)
POLICY PREMIUM CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,323 0 876 200,876 0 999 200,999 0 999 200,999
5 1,323 3,426 4,220 204,220 5,335 6,128 206,128 5,397 6,191 206,191
10 1,323 7,803 7,936 207,936 15,898 16,030 216,030 16,315 16,447 216,447
20 1,323 14,189 14,189 214,189 60,350 60,350 260,350 63,941 63,941 263,941
@ Age 70 1,323 12,166 12,166 212,166 100,148 100,148 300,148 110,276 110,276 310,276
@ Age 85 1,323 LAPSED LAPSED LAPSED 268,483 268,483 468,483 453,642 453,642 653,642
@ Age 90 1,323 LAPSED LAPSED LAPSED 252,535 252,535 452,535 661,426 661,426 861,426
</TABLE>
* Policy lapses in policy year 31 based on guaranteed charges and a gross
investment return of 0.00%.
** Policy lapses in policy year 51 based on guaranteed charges and a gross
investment return of 12.00%.
*** Policy continues to age 100 based on current charges and a gross investment
return of 12.00%.
<TABLE>
<S> <C>
APPLICANT'S OR POLICYOWNER'S I have received a copy of this illustration and understand
ACKNOWLEDGEMENT that any not-guaranteed elements are subject to change and
could be either higher or lower. The agent has told me that
they are not guaranteed.
------------------------------------------------------
Signature of Applicant or Policyowner Date
------------------------------------------------------
Signature of Applicant or Policyowner Date
REPRESENTATIVE'S I certify that this illustration has been presented to the
ACKNOWLEDGEMENT applicant and that I have explained that any not-guaranteed
elements illustrated are subject to change. I have made no
statements that are inconsistent with the illustration.
------------------------------------------------------
Signature of Representative Date
</TABLE>
Age 45 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 45 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
2 Form # B1-98
Initial Modal Premium: $1,322.78-Premium Mode: Annual-Riders: None
D-30
<PAGE> 156
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
------------------------------------------------------- ---------------------------------
END PREMIUM 0.00% (-.75% NET) 12.00% (11.25% NET) 12.00% (11.25% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,323 1,389 0 876 200,876 0 999 200,999 0 999 200,999
2 1,323 2,847 546 1,736 201,736 910 2,100 202,100 916 2,107 202,107
3 1,323 4,379 1,523 2,581 202,581 2,256 3,315 203,315 2,274 3,332 203,332
4 1,323 5,986 2,483 3,409 203,409 3,727 4,653 204,653 3,763 4,689 204,689
5 1,323 7,675 3,426 4,220 204,220 5,335 6,128 206,128 5,397 6,191 206,191
6 1,323 9,447 4,350 5,011 205,011 7,091 7,752 207,752 7,191 7,852 207,852
7 1,323 11,309 5,253 5,782 205,782 9,010 9,539 209,539 9,161 9,690 209,690
8 1,323 13,263 6,131 6,528 206,528 11,107 11,504 211,504 11,325 11,722 211,722
9 1,323 15,315 6,983 7,247 207,247 13,397 13,662 213,662 13,702 13,967 213,967
10 1,323 17,470 7,803 7,936 207,936 15,898 16,030 216,030 16,315 16,447 216,447
11 1,323 19,732 8,843 8,843 208,843 18,899 18,899 218,899 19,457 19,457 219,457
12 1,323 22,108 9,709 9,709 209,709 22,045 22,045 222,045 22,777 22,777 222,777
13 1,323 24,602 10,528 10,528 210,528 25,494 25,494 225,494 26,436 26,436 226,436
14 1,323 27,221 11,295 11,295 211,295 29,271 29,271 229,271 30,450 30,450 230,450
15 1,323 29,971 12,002 12,002 212,002 33,404 33,404 233,404 34,840 34,840 234,840
16 1,323 32,858 12,639 12,639 212,639 37,920 37,920 237,920 39,652 39,652 239,652
17 1,323 35,890 13,195 13,195 213,195 42,847 42,847 242,847 44,921 44,921 244,921
18 1,323 39,074 13,653 13,653 213,653 48,212 48,212 248,212 50,686 50,686 250,686
19 1,323 42,416 13,992 13,992 213,992 54,037 54,037 254,037 56,998 56,998 256,998
20 1,323 45,926 14,189 14,189 214,189 60,350 60,350 260,350 63,941 63,941 263,941
21 1,323 49,611 14,221 14,221 214,221 67,174 67,174 267,174 71,586 71,586 271,586
22 1,323 53,481 14,063 14,063 214,063 74,538 74,538 274,538 79,970 79,970 279,970
23 1,323 57,544 13,689 13,689 213,689 82,471 82,471 282,471 89,152 89,152 289,152
24 1,323 61,810 13,070 13,070 213,070 91,001 91,001 291,001 99,223 99,223 299,223
25 1,323 66,289 12,166 12,166 212,166 100,148 100,148 300,148 110,276 110,276 310,276
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 12.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 45 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 45 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
2 Form # B1-98
Initial Modal Premium: $1,322.78-Premium Mode: Annual-Riders: None
D-31
<PAGE> 157
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT continued
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
--------------------------------------------------------- ---------------------------------
END PREMIUM 0.00% (-.75% NET) 12.00% (11.25% NET) 12.00% (11.25% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
26 1,323 70,992 10,924 10,924 210,924 109,919 109,919 309,919 122,391 122,391 322,391
27 1,323 75,931 9,273 9,273 209,273 120,303 120,303 320,303 135,664 135,664 335,664
28 1,323 81,116 7,121 7,121 207,121 131,264 131,264 331,264 150,192 150,192 350,192
29 1,323 86,561 4,361 4,361 204,361 142,745 142,745 342,745 166,042 166,042 366,042
30 1,323 92,278 879 879 200,879 154,677 154,677 354,677 183,307 183,307 383,307
31 1,323 98,281 LAPSED LAPSED LAPSED 166,977 166,977 366,977 202,081 202,081 402,081
32 1,323 104,584 179,559 179,559 379,559 222,457 222,457 422,457
33 1,323 111,202 192,321 192,321 392,321 244,531 244,531 444,531
34 1,323 118,151 205,140 205,140 405,140 268,392 268,392 468,392
35 1,323 125,448 217,845 217,845 417,845 294,135 294,135 494,135
36 1,323 133,109 230,195 230,195 430,195 321,844 321,844 521,844
37 1,323 141,153 241,869 241,869 441,869 351,621 351,621 551,621
38 1,323 149,600 252,459 252,459 452,459 383,564 383,564 583,564
39 1,323 158,469 261,498 261,498 461,498 417,593 417,593 617,593
40 1,323 167,781 268,483 268,483 468,483 453,642 453,642 653,642
41 1,323 177,559 272,882 272,882 472,882 491,740 491,740 691,740
42 1,323 187,826 274,131 274,131 474,131 531,762 531,762 731,762
43 1,323 198,606 271,620 271,620 471,620 573,582 573,582 773,582
44 1,323 209,925 264,682 264,682 464,682 616,885 616,885 816,885
45 1,323 221,811 252,535 252,535 452,535 661,426 661,426 861,426
46 1,323 234,290 234,269 234,269 434,269 706,924 706,924 906,924
47 1,323 247,393 208,749 208,749 408,749 753,017 753,017 953,017
48 1,323 261,152 174,502 174,502 374,502 799,280 799,280 999,280
48 1,323 275,599 129,375 129,375 329,375 846,275 846,275 1,046,275
50 1,323 290,767 69,777 69,777 269,777 893,821 893,821 1,093,821
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 12.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 45 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 45 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
2 Form # B1-98
Initial Modal Premium: $1,322.78-Premium Mode: Annual-Riders: None
D-32
<PAGE> 158
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT continued
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
------------------------------------------------------- ---------------------------------
END PREMIUM 0.00% (-.75% NET) 12.00% (11.25% NET) 12.00% (11.25% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
51 1,323 306,695 LAPSED LAPSED LAPSED 941,638 941,638 1,141,638
51 1,323 323,418 988,262 988,262 1,188,262
53 1,323 340,978 1,034,946 1,034,946 1,234,946
54 1,323 359,416 1,081,483 1,081,483 1,281,483
55 1,323 378,776 1,127,792 1,127,792 1,327,792
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 12.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 45 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 45 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
2 Form # B1-98
Initial Modal Premium: $1,322.78-Premium Mode: Annual-Riders: None
D-33
<PAGE> 159
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
<TABLE>
<S> <C>
NUMERIC SUMMARY The following table shows how differences in investment
returns and policy charges would affect policy cash value
and death benefit.
</TABLE>
<TABLE>
<CAPTION>
GUARANTEED CHARGES* GUARANTEED CHARGES** CURRENT CHARGES***
-------------------------- -------------------------- --------------------------
0.00% (-.75% NET) 0.00% (-.75% NET) 0.00% (-.75% NET)
POLICY PREMIUM CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 752 0 415 200,000 0 415 200,000 0 415 200,000
5 752 1,561 2,013 200,000 1,561 2,013 200,000 1,573 2,024 200,000
10 752 3,779 3,855 200,000 3,779 3,855 200,000 3,835 3,910 200,000
20 752 8,456 8,456 200,000 8,456 8,456 200,000 8,793 8,793 200,000
@ Age 70 752 4,569 4,569 200,000 4,569 4,569 200,000 9,758 9,758 200,000
@ Age 85 LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED
@ Age 90 LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED
</TABLE>
* Policy lapses in policy year 38 based on guaranteed charges and a gross
investment return of 0.00%.
** Policy lapses in policy year 38 based on guaranteed charges and a gross
investment return of 0.00%.
*** Policy lapses in policy year 43 based on current charges and a gross
investment return of 0.00%.
<TABLE>
<S> <C>
APPLICANT'S OR POLICYOWNER'S I have received a copy of this illustration and understand
ACKNOWLEDGEMENT that any not-guaranteed elements are subject to change and
could be either higher or lower. The agent has told me that
they are not guaranteed.
------------------------------------------------------
Signature of Applicant or Policyowner Date
------------------------------------------------------
Signature of Applicant or Policyowner Date
REPRESENTATIVE'S I certify that this illustration has been presented to the
ACKNOWLEDGEMENT applicant and that I have explained that any not-guaranteed
elements illustrated are subject to change. I have made no
statements that are inconsistent with the illustration.
------------------------------------------------------
Signature of Representative Date
</TABLE>
Age 35 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 35 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $751.91-Premium Mode: Annual-Riders: None
D-34
<PAGE> 160
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
------------------------------------------------------- --------------------------
END PREMIUM 0.00% (-.75% NET) 0.00% (-.75% NET) 0.00% (-.75% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 752 790 0 415 200,000 0 415 200,000 0 415 200,000
2 752 1,618 146 823 200,000 146 823 200,000 148 824 200,000
3 752 2,489 624 1,226 200,000 624 1,226 200,000 628 1,229 200,000
4 752 3,403 1,096 1,622 200,000 1,096 1,622 200,000 1,103 1,629 200,000
5 752 4,363 1,561 2,013 200,000 1,561 2,013 200,000 1,573 2,024 200,000
6 752 5,370 2,020 2,396 200,000 2,020 2,396 200,000 2,037 2,413 200,000
7 752 6,428 2,472 2,772 200,000 2,472 2,772 200,000 2,496 2,797 200,000
8 752 7,539 2,916 3,141 200,000 2,916 3,141 200,000 2,949 3,174 200,000
9 752 8,706 3,352 3,502 200,000 3,352 3,502 200,000 3,395 3,545 200,000
10 752 9,930 3,779 3,855 200,000 3,779 3,855 200,000 3,835 3,910 200,000
11 752 11,216 4,387 4,387 200,000 4,387 4,387 200,000 4,458 4,458 200,000
12 752 12,567 4,907 4,907 200,000 4,907 4,907 200,000 4,996 4,996 200,000
13 752 13,985 5,414 5,414 200,000 5,414 5,414 200,000 5,525 5,525 200,000
14 752 15,473 5,906 5,906 200,000 5,906 5,906 200,000 6,041 6,041 200,000
15 752 17,036 6,383 6,383 200,000 6,383 6,383 200,000 6,543 6,543 200,000
16 752 18,678 6,843 6,843 200,000 6,843 6,843 200,000 7,028 7,028 200,000
17 752 20,401 7,283 7,283 200,000 7,283 7,283 200,000 7,495 7,495 200,000
18 752 22,211 7,701 7,701 200,000 7,701 7,701 200,000 7,942 7,942 200,000
19 752 24,111 8,093 8,093 200,000 8,093 8,093 200,000 8,374 8,374 200,000
20 752 26,106 8,456 8,456 200,000 8,456 8,456 200,000 8,793 8,793 200,000
21 752 28,201 8,786 8,786 200,000 8,786 8,786 200,000 9,199 9,199 200,000
22 752 30,400 9,078 9,078 200,000 9,078 9,078 200,000 9,580 9,580 200,000
23 752 32,710 9,329 9,329 200,000 9,329 9,329 200,000 9,934 9,934 200,000
24 752 35,135 9,533 9,533 200,000 9,533 9,533 200,000 10,255 10,255 200,000
25 752 37,681 9,683 9,683 200,000 9,683 9,683 200,000 10,540 10,540 200,000
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 0.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 35 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 35 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $751.91-Premium Mode: Annual-Riders: None
D-35
<PAGE> 161
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT continued
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
------------------------------------------------------- --------------------------
END PREMIUM 0.00% (-.75% NET) 0.00% (-.75% NET) 0.00% (-.75% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
26 752 40,355 9,768 9,768 200,000 9,768 9,768 200,000 10,782 10,782 200,000
27 752 43,162 9,778 9,778 200,000 9,778 9,778 200,000 10,973 10,973 200,000
28 752 46,109 9,695 9,695 200,000 9,695 9,695 200,000 11,105 11,105 200,000
29 752 49,204 9,499 9,499 200,000 9,499 9,499 200,000 11,171 11,171 200,000
30 752 52,454 9,167 9,167 200,000 9,167 9,167 200,000 11,168 11,168 200,000
31 752 55,866 8,675 8,675 200,000 8,675 8,675 200,000 11,075 11,075 200,000
32 752 59,449 8,000 8,000 200,000 8,000 8,000 200,000 10,898 10,898 200,000
33 752 63,211 7,113 7,113 200,000 7,113 7,113 200,000 10,618 10,618 200,000
34 752 67,161 5,984 5,984 200,000 5,984 5,984 200,000 10,238 10,238 200,000
35 752 71,309 4,569 4,569 200,000 4,569 4,569 200,000 9,758 9,758 200,000
36 752 75,664 2,809 2,809 200,000 2,809 2,809 200,000 9,152 9,152 200,000
37 752 80,236 622 622 200,000 622 622 200,000 8,404 8,404 200,000
38 752 85,038 LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED 7,487 7,487 200,000
39 752 90,079 6,333 6,333 200,000
40 752 95,373 4,896 4,896 200,000
41 752 100,931 3,115 3,115 200,000
42 752 106,767 918 918 200,000
43 752 112,895 LAPSED LAPSED LAPSED
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 0.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 35 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 35 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $751.91-Premium Mode: Annual-Riders: None
D-36
<PAGE> 162
\ LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
<TABLE>
<S> <C>
NUMERIC SUMMARY The following table shows how differences in investment
returns and policy charges would affect policy cash value
and death benefit.
</TABLE>
<TABLE>
<CAPTION>
GUARANTEED CHARGES* GUARANTEED CHARGES** CURRENT CHARGES***
-------------------------- -------------------------- --------------------------
0.00% (-.75% NET) 6.00% (5.25% NET) 6.00% (5.25% NET)
POLICY PREMIUM CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 752 0 415 200,000 0 447 200,000 0 447 200,000
5 752 1,561 2,013 200,000 1,995 2,446 200,000 2,008 2,459 200,000
10 752 3,779 3,855 200,000 5,405 5,481 200,000 5,472 5,547 200,000
20 752 8,456 8,456 200,000 15,963 15,963 200,000 16,429 16,429 200,000
@ Age 70 752 4,569 4,569 200,000 33,240 33,240 200,000 40,010 40,010 200,000
@ Age 85 752 LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED 33,873 33,873 200,000
@ Age 90 LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED
</TABLE>
* Policy lapses in policy year 38 based on guaranteed charges and a gross
investment return of 0.00%.
** Policy lapses in policy year 46 based on guaranteed charges and a gross
investment return of 6.00%.
*** Policy lapses in policy year 53 based on current charges and a gross
investment return of 6.00%.
<TABLE>
<S> <C>
APPLICANT'S OR POLICYOWNER'S I have received a copy of this illustration and understand
ACKNOWLEDGEMENT that any not-guaranteed elements are subject to change and
could be either higher or lower. The agent has told me that
they are not guaranteed.
------------------------------------------------------
Signature of Applicant or Policyowner Date
------------------------------------------------------
Signature of Applicant or Policyowner Date
REPRESENTATIVE'S I certify that this illustration has been presented to the
ACKNOWLEDGEMENT applicant and that I have explained that any not-guaranteed
elements illustrated are subject to change. I have made no
statements that are inconsistent with the illustration.
------------------------------------------------------
Signature of Representative Date
</TABLE>
Age 35 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 35 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $751.91-Premium Mode: Annual-Riders: None
D-37
<PAGE> 163
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
------------------------------------------------------- --------------------------
END PREMIUM 0.00% (-.75% NET) 6.00% (5.25% NET) 6.00% (5.25% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 752 790 0 415 200,000 0 447 200,000 0 447 200,000
2 752 1,618 146 823 200,000 237 914 200,000 239 915 200,000
3 752 2,489 624 1,226 200,000 801 1,402 200,000 805 1,406 200,000
4 752 3,403 1,096 1,622 200,000 1,387 1,913 200,000 1,394 1,920 200,000
5 752 4,363 1,561 2,013 200,000 1,995 2,446 200,000 2,008 2,459 200,000
6 752 5,370 2,020 2,396 200,000 2,628 3,004 200,000 2,647 3,023 200,000
7 752 6,428 2,472 2,772 200,000 3,284 3,585 200,000 3,311 3,612 200,000
8 752 7,539 2,916 3,141 200,000 3,965 4,191 200,000 4,003 4,229 200,000
9 752 8,706 3,352 3,502 200,000 4,672 4,823 200,000 4,723 4,874 200,000
10 752 9,930 3,779 3,855 200,000 5,405 5,481 200,000 5,472 5,547 200,000
11 752 11,216 4,387 4,387 200,000 6,361 6,361 200,000 6,447 6,447 200,000
12 752 12,567 4,907 4,907 200,000 7,278 7,278 200,000 7,387 7,387 200,000
13 752 13,985 5,414 5,414 200,000 8,232 8,232 200,000 8,371 8,371 200,000
14 752 15,473 5,906 5,906 200,000 9,224 9,224 200,000 9,395 9,395 200,000
15 752 17,036 6,383 6,383 200,000 10,255 10,255 200,000 10,460 10,460 200,000
16 752 18,678 6,843 6,843 200,000 11,323 11,323 200,000 11,566 11,566 200,000
17 752 20,401 7,283 7,283 200,000 12,430 12,430 200,000 12,713 12,713 200,000
18 752 22,211 7,701 7,701 200,000 13,573 13,573 200,000 13,902 13,902 200,000
19 752 24,111 8,093 8,093 200,000 14,751 14,751 200,000 15,140 15,140 200,000
20 752 26,106 8,456 8,456 200,000 15,963 15,963 200,000 16,429 16,429 200,000
21 752 28,201 8,786 8,786 200,000 17,206 17,206 200,000 17,773 17,773 200,000
22 752 30,400 9,078 9,078 200,000 18,477 18,477 200,000 19,164 19,164 200,000
23 752 32,710 9,329 9,329 200,000 19,774 19,774 200,000 20,601 20,601 200,000
24 752 35,135 9,533 9,533 200,000 21,093 21,093 200,000 22,082 22,082 200,000
25 752 37,681 9,683 9,683 200,000 22,428 22,428 200,000 23,604 23,604 200,000
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 6.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 35 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 35 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $751.91-Premium Mode: Annual-Riders: None
D-38
<PAGE> 164
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT continued
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
------------------------------------------------------- --------------------------
END PREMIUM 0.00% (-.75% NET) 6.00% (5.25% NET) 6.00% (5.25% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
26 752 40,355 9,768 9,768 200,000 23,770 23,770 200,000 25,163 25,163 200,000
27 752 43,162 9,778 9,778 200,000 25,110 25,110 200,000 26,754 26,754 200,000
28 752 46,109 9,695 9,695 200,000 26,431 26,431 200,000 28,373 28,373 200,000
29 752 49,204 9,499 9,499 200,000 27,714 27,714 200,000 30,012 30,012 200,000
30 752 52,454 9,167 9,167 200,000 28,937 28,937 200,000 31,672 31,672 200,000
31 752 55,866 8,675 8,675 200,000 30,076 30,076 200,000 33,336 33,336 200,000
32 752 59,449 8,000 8,000 200,000 31,107 31,107 200,000 35,009 35,009 200,000
33 752 63,211 7,113 7,113 200,000 32,002 32,002 200,000 36,677 36,677 200,000
34 752 67,161 5,984 5,984 200,000 32,728 32,728 200,000 38,344 38,344 200,000
35 752 71,309 4,569 4,569 200,000 33,240 33,240 200,000 40,010 40,010 200,000
36 752 75,664 2,809 2,809 200,000 33,479 33,479 200,000 41,656 41,656 200,000
37 752 80,236 622 622 200,000 33,364 33,364 200,000 43,269 43,269 200,000
38 752 85,038 LAPSED LAPSED LAPSED 32,788 32,788 200,000 44,827 44,827 200,000
39 752 90,079 31,621 31,621 200,000 46,276 46,276 200,000
40 752 95,373 29,708 29,708 200,000 47,577 47,577 200,000
41 752 100,931 26,869 26,869 200,000 48,680 48,680 200,000
42 752 106,767 22,898 22,898 200,000 49,525 49,525 200,000
43 752 112,895 17,543 17,543 200,000 50,041 50,041 200,000
44 752 119,329 10,485 10,485 200,000 50,140 50,140 200,000
45 752 126,085 1,295 1,295 200,000 49,720 49,720 200,000
46 752 133,179 LAPSED LAPSED LAPSED 48,652 48,652 200,000
47 752 140,627 46,793 46,793 200,000
48 752 148,448 43,964 43,964 200,000
49 752 156,660 39,798 39,798 200,000
50 752 165,282 33,873 33,873 200,000
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 6.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 35 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 35 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $751.91-Premium Mode: Annual-Riders: None
D-39
<PAGE> 165
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT continued
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
------------------------------------------------------- --------------------------
END PREMIUM 0.00% (-.75% NET) 6.00% (5.25% NET) 6.00% (5.25% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
51 752 174,336 25,743 25,743 200,000
52 752 183,842 14,688 14,688 200,000
53 752 193,824 LAPSED LAPSED LAPSED
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 6.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 35 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 35 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $751.91-Premium Mode: Annual-Riders: None
D-40
<PAGE> 166
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
<TABLE>
<S> <C>
NUMERIC SUMMARY The following table shows how differences in investment
returns and policy charges would affect policy cash value
and death benefit.
</TABLE>
<TABLE>
<CAPTION>
GUARANTEED CHARGES* GUARANTEED CHARGES** CURRENT CHARGES***
-------------------------- --------------------------------- ---------------------------------
0.00% (-.75% NET) 12.00% (11.25% NET) 12.00% (11.25% NET)
POLICY PREMIUM CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 752 0 415 200,000 0 479 200,000 0 479 200,000
5 752 1,561 2,013 200,000 2,507 2,958 200,000 2,521 2,972 200,000
10 752 3,779 3,855 200,000 7,756 7,831 200,000 7,837 7,912 200,000
20 752 8,456 8,456 200,000 32,195 32,195 200,000 32,866 32,866 200,000
@ Age 70 752 4,569 4,569 200,000 163,025 163,025 200,000 171,179 171,179 200,000
@ Age 85 752 LAPSED LAPSED LAPSED 760,174 760,174 798,182 813,493 813,493 854,168
@ Age 90 752 LAPSED LAPSED LAPSED 1,230,455 1,230,455 1,291,978 1,339,849 1,339,849 1,406,841
</TABLE>
* Policy lapses in policy year 38 based on guaranteed charges and a gross
investment return of 0.00%.
** Policy continues to age 100 based on guaranteed charges and a gross
investment return of 12.00%.
*** Policy continues to age 100 based on current charges and a gross investment
return of 12.00%.
<TABLE>
<S> <C>
APPLICANT'S OR POLICYOWNER'S I have received a copy of this illustration and understand
ACKNOWLEDGEMENT that any not-guaranteed elements are subject to change and
could be either higher or lower. The agent has told me that
they are not guaranteed.
------------------------------------------------------
Signature of Applicant or Policyowner Date
------------------------------------------------------
Signature of Applicant or Policyowner Date
REPRESENTATIVE'S I certify that this illustration has been presented to the
ACKNOWLEDGEMENT applicant and that I have explained that any not-guaranteed
elements illustrated are subject to change. I have made no
statements that are inconsistent with the illustration.
------------------------------------------------------
Signature of Representative Date
</TABLE>
Age 35 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 35 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $751.91-Premium Mode: Annual-Riders: None
D-41
<PAGE> 167
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
-------------------------------------------------------------- ---------------------------------
END PREMIUM 0.00% (-.75% NET) 12.00% (11.25% NET) 12.00% (11.25% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 752 790 0 415 200,000 0 479 200,000 0 479 200,000
2 752 1,618 146 823 200,000 332 1,009 200,000 334 1,010 200,000
3 752 2,489 624 1,226 200,000 993 1,595 200,000 997 1,599 200,000
4 752 3,403 1,096 1,622 200,000 1,716 2,242 200,000 1,724 2,250 200,000
5 752 4,363 1,561 2,013 200,000 2,507 2,958 200,000 2,521 2,972 200,000
6 752 5,370 2,020 2,396 200,000 3,373 3,749 200,000 3,394 3,770 200,000
7 752 6,428 2,472 2,772 200,000 4,322 4,623 200,000 4,353 4,654 200,000
8 752 7,539 2,916 3,141 200,000 5,363 5,588 200,000 5,407 5,632 200,000
9 752 8,706 3,352 3,502 200,000 6,504 6,654 200,000 6,564 6,715 200,000
10 752 9,930 3,779 3,855 200,000 7,756 7,831 200,000 7,837 7,912 200,000
11 752 11,216 4,387 4,387 200,000 9,334 9,334 200,000 9,439 9,439 200,000
12 752 12,567 4,907 4,907 200,000 10,992 10,992 200,000 11,129 11,129 200,000
13 752 13,985 5,414 5,414 200,000 12,824 12,824 200,000 12,999 12,999 200,000
14 752 15,473 5,906 5,906 200,000 14,846 14,846 200,000 15,065 15,065 200,000
15 752 17,036 6,383 6,383 200,000 17,077 17,077 200,000 17,347 17,347 200,000
16 752 18,678 6,843 6,843 200,000 19,540 19,540 200,000 19,866 19,866 200,000
17 752 20,401 7,283 7,283 200,000 22,256 22,256 200,000 22,647 22,647 200,000
18 752 22,211 7,701 7,701 200,000 25,252 25,252 200,000 25,716 25,716 200,000
19 752 24,111 8,093 8,093 200,000 28,555 28,555 200,000 29,110 29,110 200,000
20 752 26,106 8,456 8,456 200,000 32,195 32,195 200,000 32,866 32,866 200,000
21 752 28,201 8,786 8,786 200,000 36,207 36,207 200,000 37,024 37,024 200,000
22 752 30,400 9,078 9,078 200,000 40,628 40,628 200,000 41,618 41,618 200,000
23 752 32,710 9,329 9,329 200,000 45,500 45,500 200,000 46,694 46,694 200,000
24 752 35,135 9,533 9,533 200,000 50,872 50,872 200,000 52,302 52,302 200,000
25 752 37,681 9,683 9,683 200,000 56,793 56,793 200,000 58,497 58,497 200,000
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 12.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 35 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 35 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $751.91-Premium Mode: Annual-Riders: None
D-42
<PAGE> 168
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT continued
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
-------------------------------------------------------------- ---------------------------------
END PREMIUM 0.00% (-.75% NET) 12.00% (11.25% NET) 12.00% (11.25% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
26 752 40,355 9,768 9,768 200,000 63,321 63,321 200,000 65,341 65,341 200,000
27 752 43,162 9,778 9,778 200,000 70,518 70,518 200,000 72,902 72,902 200,000
28 752 46,109 9,695 9,695 200,000 78,452 78,452 200,000 81,259 81,259 200,000
29 752 49,204 9,499 9,499 200,000 87,201 87,201 200,000 90,500 90,500 200,000
30 752 52,454 9,167 9,167 200,000 96,852 96,852 200,000 100,726 100,726 200,000
31 752 55,866 8,675 8,675 200,000 107,511 107,511 200,000 112,045 112,045 200,000
32 752 59,449 8,000 8,000 200,000 119,300 119,300 200,000 124,593 124,593 200,000
33 752 63,211 7,113 7,113 200,000 132,364 132,364 200,000 138,512 138,512 200,000
34 752 67,161 5,984 5,984 200,000 146,872 146,872 200,000 153,977 153,977 200,000
35 752 71,309 4,569 4,569 200,000 163,025 163,025 200,000 171,179 171,179 200,000
36 752 75,664 2,809 2,809 200,000 181,046 181,046 208,203 190,289 190,289 218,832
37 752 80,236 622 622 200,000 201,035 201,035 227,170 211,463 211,463 238,953
38 752 85,038 LAPSED LAPSED LAPSED 223,156 223,156 247,703 234,925 234,925 260,767
39 752 90,079 247,651 247,651 269,939 260,926 260,926 284,410
40 752 95,373 274,799 274,799 294,035 289,752 289,752 310,035
41 752 100,931 304,931 304,931 320,178 321,726 321,726 337,813
42 752 106,767 338,214 338,214 355,125 357,119 357,119 374,975
43 752 112,895 374,958 374,958 393,705 396,285 396,285 416,100
44 752 119,329 415,497 415,497 436,272 439,612 439,612 461,593
45 752 126,085 460,195 460,195 483,204 487,525 487,525 511,902
46 752 133,179 509,433 509,433 534,904 540,487 540,487 567,511
47 752 140,627 563,616 563,616 591,797 599,003 599,003 628,953
48 752 148,448 623,168 623,168 654,327 663,624 663,624 696,805
49 752 156,660 688,532 688,532 722,959 734,917 734,917 771,663
50 752 165,282 760,174 760,174 798,182 813,493 813,493 854,168
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 12.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 35 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 35 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $751.91-Premium Mode: Annual-Riders: None
D-43
<PAGE> 169
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT continued
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
-------------------------------------------------------------- ---------------------------------
END PREMIUM 0.00% (-.75% NET) 12.00% (11.25% NET) 12.00% (11.25% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
51 752 174,336 838,582 838,582 880,511 900,025 900,025 945,027
52 752 183,842 924,272 924,272 970,485 995,200 995,200 1,044,960
53 752 193,824 1,017,777 1,017,777 1,068,666 1,099,744 1,099,744 1,154,731
54 752 204,305 1,119,652 1,119,652 1,175,635 1,214,374 1,214,374 1,275,092
55 752 215,309 1,230,455 1,230,455 1,291,978 1,339,849 1,339,849 1,406,841
56 752 226,864 1,350,734 1,350,734 1,418,270 1,476,940 1,476,940 1,550,787
57 752 238,997 1,484,677 1,484,677 1,544,065 1,628,917 1,628,917 1,694,074
58 752 251,737 1,634,684 1,634,684 1,683,724 1,798,125 1,798,125 1,852,069
59 752 265,113 1,803,765 1,803,765 1,839,840 1,987,683 1,987,683 2,027,437
60 752 279,158 1,995,876 1,995,876 2,015,834 2,201,195 2,201,195 2,223,207
61 752 293,905 2,207,418 2,207,418 2,229,492 2,437,203 2,437,203 2,461,575
62 752 309,390 2,439,451 2,439,451 2,463,846 2,697,915 2,697,915 2,724,894
63 752 325,649 2,691,617 2,691,617 2,718,533 2,985,983 2,985,983 3,015,843
64 752 342,721 2,965,892 2,965,892 2,995,551 3,304,205 3,304,205 3,337,247
65 752 360,647 3,268,046 3,268,046 3,300,726 3,655,673 3,655,673 3,692,230
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 12.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 35 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 35 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $751.91-Premium Mode: Annual-Riders: None
D-44
<PAGE> 170
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
<TABLE>
<S> <C>
NUMERIC SUMMARY The following table shows how differences in investment
returns and policy charges would affect policy cash value
and death benefit.
</TABLE>
<TABLE>
<CAPTION>
GUARANTEED CHARGES* GUARANTEED CHARGES** CURRENT CHARGES***
-------------------------- --------------------------- ---------------------------
0.00% (-.75% NET) 0.00% (-.75% NET) 0.00% (-.75% NET)
POLICY PREMIUM CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 2,305 0 1,634 200,000 0 1,634 200,000 0 1,634 200,000
5 2,305 6,286 7,669 200,000 6,286 7,669 200,000 6,585 7,969 200,000
10 2,305 13,364 13,594 200,000 13,364 13,594 200,000 15,100 15,330 200,000
20 2,305 13,343 13,343 200,000 13,343 13,343 200,000 28,269 28,269 200,000
@ Age 70 2,305 17,750 17,750 200,000 17,750 17,750 200,000 23,530 23,530 200,000
@ Age 85 2,305 LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED 4,225 4,225 200,000
@ Age 90 LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED
</TABLE>
* Policy lapses in policy year 24 based on guaranteed charges and a gross
investment return of 0.00%.
** Policy lapses in policy year 24 based on guaranteed charges and a gross
investment return of 0.00%.
*** Policy lapses in policy year 31 based on current charges and a gross
investment return of 0.00%.
<TABLE>
<S> <C>
APPLICANT'S OR POLICYOWNER'S I have received a copy of this illustration and understand
ACKNOWLEDGEMENT that any not-guaranteed elements are subject to change and
could be either higher or lower. The agent has told me that
they are not guaranteed.
------------------------------------------------------
Signature of Applicant or Policyowner Date
------------------------------------------------------
Signature of Applicant or Policyowner Date
REPRESENTATIVE'S I certify that this illustration has been presented to the
ACKNOWLEDGEMENT applicant and that I have explained that any not-guaranteed
elements illustrated are subject to change. I have made no
statements that are inconsistent with the illustration.
------------------------------------------------------
Signature of Representative Date
</TABLE>
Age 55 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 55 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $2,305.37-Premium Mode: Annual-Riders: None
D-45
<PAGE> 171
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
----------------------------------------------------- -------------------------
END PREMIUM 0.00% (-.75% NET) 0.00% (-.75% NET) 0.00% (-.75% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 2,305 2,421 0 1,634 200,000 0 1,634 200,000 0 1,634 200,000
2 2,305 4,962 1,142 3,216 200,000 1,142 3,216 200,000 1,174 3,248 200,000
3 2,305 7,631 2,909 4,753 200,000 2,909 4,753 200,000 2,999 4,843 200,000
4 2,305 10,433 4,626 6,239 200,000 4,626 6,239 200,000 4,803 6,417 200,000
5 2,305 13,376 6,286 7,669 200,000 6,286 7,669 200,000 6,585 7,969 200,000
6 2,305 16,465 7,881 9,034 200,000 7,881 9,034 200,000 8,344 9,497 200,000
7 2,305 19,709 9,402 10,324 200,000 9,402 10,324 200,000 10,078 11,000 200,000
8 2,305 23,115 10,834 11,526 200,000 10,834 11,526 200,000 11,784 12,475 200,000
9 2,305 26,691 12,162 12,623 200,000 12,162 12,623 200,000 13,459 13,920 200,000
10 2,305 30,447 13,364 13,594 200,000 13,364 13,594 200,000 15,100 15,330 200,000
11 2,305 34,389 14,822 14,822 200,000 14,822 14,822 200,000 17,100 17,100 200,000
12 2,305 38,530 15,878 15,878 200,000 15,878 15,878 200,000 18,818 18,818 200,000
13 2,305 42,877 16,737 16,737 200,000 16,737 16,737 200,000 20,476 20,476 200,000
14 2,305 47,441 17,373 17,373 200,000 17,373 17,373 200,000 22,052 22,052 200,000
15 2,305 52,234 17,750 17,750 200,000 17,750 17,750 200,000 23,530 23,530 200,000
16 2,305 57,266 17,817 17,817 200,000 17,817 17,817 200,000 24,860 24,860 200,000
17 2,305 62,550 17,509 17,509 200,000 17,509 17,509 200,000 26,019 26,019 200,000
18 2,305 68,098 16,736 16,736 200,000 16,736 16,736 200,000 26,973 26,973 200,000
19 2,305 73,924 15,389 15,389 200,000 15,389 15,389 200,000 27,731 27,731 200,000
20 2,305 80,041 13,343 13,343 200,000 13,343 13,343 200,000 28,269 28,269 200,000
21 2,305 86,463 10,455 10,455 200,000 10,455 10,455 200,000 28,562 28,562 200,000
22 2,305 93,207 6,567 6,567 200,000 6,567 6,567 200,000 28,523 28,523 200,000
23 2,305 100,288 1,495 1,495 200,000 1,495 1,495 200,000 28,086 28,086 200,000
24 2,305 107,723 LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED 27,168 27,168 200,000
25 2,305 115,530 25,674 25,674 200,000
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 0.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 55 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 55 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $2,305.37-Premium Mode: Annual-Riders: None
D-46
<PAGE> 172
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
STANDARD LEDGER STATEMENT continued
<TABLE>
<CAPTION>
GUARANTEED CHARGES CURRENT CHARGES
----------------------------------------------------- -------------------------
END PREMIUM 0.00% (-.75% NET) 0.00% (-.75% NET) 0.00% (-.75% NET)
OF PREMIUM ACCUM'D CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY AT 5% VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
26 2,305 123,727 23,490 23,490 200,000
27 2,305 132,334 20,485 20,485 200,000
28 2,305 141,371 16,504 16,504 200,000
29 2,305 150,861 11,212 11,212 200,000
30 2,305 160,824 4,225 4,225 200,000
31 2,305 171,286 LAPSED LAPSED LAPSED
</TABLE>
This is an illustration, not a policy.
Borrowed funds are credited at 4.50% interest. Premiums are assumed to be paid
at the beginning of the year or month. All other values and ages are at the end
of the year and reflect any loans and surrenders. The current cost of insurance
rates are not guaranteed and subject to change.
The hypothetical investment results are illustrative only, and should not be
deemed a representation of past or future investment results. Actual investment
results may be more or less than those shown, and will depend on a number of
factors, including the investment allocations by policyowners, and the different
investment rates of return for MONY Series Fund, Inc. or Enterprise Accumulation
Trust portfolios. The Cash Value, Fund Value and Death Proceeds for a policy
would be different from those shown if the actual rates of investment return
applicable to the policy averaged 0.00% or 0.00% over a period of years, but
also fluctuated above or below those averages for individual policy years. No
representations can be made by MONY Life Insurance Company of America, MONY
Series Fund, Inc. or Enterprise Accumulation Trust that these hypothetical rates
of return can be achieved for any one year, or sustained over any period of
time.
Age 55 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 55 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $2,305.37-Premium Mode: Annual-Riders: None
D-47
<PAGE> 173
LIFE INSURANCE ILLUSTRATION
MONY Custom EstateMaster
LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE LIFE TO MATURITY POLICY
<TABLE>
<S> <C>
NUMERIC SUMMARY The following table shows how differences in investment
returns and policy charges would affect policy cash value
and death benefit.
</TABLE>
<TABLE>
<CAPTION>
GUARANTEED CHARGES* GUARANTEED CHARGES** CURRENT CHARGES***
-------------------------- -------------------------- --------------------------
0.00% (-.75% NET) 6.00% (5.25% NET) 6.00% (5.25% NET)
POLICY PREMIUM CASH FUND DEATH CASH FUND DEATH CASH FUND DEATH
YEAR OUTLAY VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS VALUE VALUE PROCEEDS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 2,305 0 1,634 200,000 0 1,745 200,000 0 1,745 200,000
5 2,305 6,286 7,669 200,000 7,882 9,265 200,000 8,208 9,592 200,000
10 2,305 13,364 13,594 200,000 19,314 19,545 200,000 21,338 21,568 200,000
20 2,305 13,343 13,343 200,000 37,968 37,968 200,000 56,620 56,620 200,000
@ Age 70 2,305 17,750 17,750 200,000 31,265 31,265 200,000 38,300 38,300 200,000
@ Age 85 2,305 LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED 83,867 83,867 200,000
@ Age 90 2,305 LAPSED LAPSED LAPSED LAPSED LAPSED LAPSED 63,619 63,619 200,000
</TABLE>
* Policy lapses in policy year 24 based on guaranteed charges and a gross
investment return of 0.00%.
** Policy lapses in policy year 28 based on guaranteed charges and a gross
investment return of 6.00%.
*** Policy lapses in policy year 39 based on current charges and a gross
investment return of 6.00%.
<TABLE>
<S> <C>
APPLICANT'S OR POLICYOWNER'S I have received a copy of this illustration and understand
ACKNOWLEDGEMENT that any not-guaranteed elements are subject to change and
could be either higher or lower. The agent has told me that
they are not guaranteed.
------------------------------------------------------
Signature of Applicant or Policyowner Date
------------------------------------------------------
Signature of Applicant or Policyowner Date
REPRESENTATIVE'S I certify that this illustration has been presented to the
ACKNOWLEDGEMENT applicant and that I have explained that any not-guaranteed
elements illustrated are subject to change. I have made no
statements that are inconsistent with the illustration.
------------------------------------------------------
Signature of Representative Date
</TABLE>
Age 55 Male Non-Smoker Preferred Prepared On: 09/11/1998
Age 55 Female Non-Smoker Preferred Version 98.09.01
Specified Amount: $200,000-Death Benefit Option: Specified Amount for Option
1 Form # B1-98
Initial Modal Premium: $2,305.37-Premium Mode: Annual-Riders: None
D-48
