As filed with the Securities and Exchange Commission on January 29, 1999
REGISTRATION NO. 333-23171
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------
POST-EFFECTIVE AMENDMENT NO. 3
TO
FORM S-6
----------------------
FOR REGISTRATION UNDER THE SECURITIES ACT
OF 1933 OF SECURITIES OF UNIT INVESTMENT TRUSTS
REGISTERED ON FORM N-8B-2
----------------------
PHOENIX HOME LIFE VARIABLE UNIVERSAL LIFE ACCOUNT
(EXACT NAME OF TRUST)
PHOENIX HOME LIFE MUTUAL INSURANCE COMPANY
(NAME OF DEPOSITOR)
----------------------
ONE AMERICAN ROW
HARTFORD, CONNECTICUT 06115
(COMPLETE ADDRESS OF DEPOSITOR'S PRINCIPAL EXECUTIVE OFFICES)
DONA D. YOUNG, ESQUIRE
EXECUTIVE VICE PRESIDENT AND GENERAL COUNSEL
PHOENIX HOME LIFE MUTUAL INSURANCE COMPANY
ONE AMERICAN ROW
HARTFORD, CONNECTICUT 06115
(NAME AND COMPLETE ADDRESS OF AGENT FOR SERVICE)
----------------------
COPIES TO:
<TABLE>
<S> <C>
MICHAEL BERENSON, ESQ. EDWIN L. KERR, ESQ.
JORDEN BURT BOROS CICCHETTI BERENSON & JOHNSON LLP COUNSEL
1025 THOMAS JEFFERSON ST. N.W. PHOENIX HOME LIFE MUTUAL INSURANCE COMPANY
SUITE 400 EAST ONE AMERICAN ROW
WASHINGTON, D.C. 20007-0805 HARTFORD, CONNECTICUT 06115
</TABLE>
----------------------
It is proposed that this filing will become effective:
[ ] immediately upon filing pursuant to paragraph (b);
[ ] on pursuant to paragraph (b);
[ ] 60 days after filing pursuant to paragraph (a)(1); or
[X] on May 1, 1999 pursuant to paragraph (a)(1) of Rule 485.
[ ] this Post-Effective Amendment designates a new effective date
for a previously filed post-effective amendment.
----------------------
================================================================================
<PAGE>
CROSS REFERENCE TO ITEMS REQUIRED
BY FORM N-8B-2
<TABLE>
<CAPTION>
N-8B-2 ITEM CAPTION IN PROSPECTUS
- ----------- ---------------------
<S> <C>
1 The VUL Account
2 Phoenix Home Life Mutual Insurance Company
3 Not Applicable
4 Sales of Policies
5 The VUL Account
6 The VUL Account
7 Not Applicable
8 Not Applicable
9 Legal Proceedings
10 The Policy
11 Investments of the VUL Account
12 Investments of the VUL Account
13 Charges and Deductions; Investments of the VUL Account
14 Flexible Premiums; Allocation of Premium and Policy Value; Right to Cancel Period
15 Allocation of Premium and Policy Value; Transfer of Policy Value
16 Investments of the VUL Account
17 Surrenders
18 Allocation of Premium and Policy Value; Transfer of Policy Value; Reinvestment and Redemption
19 Voting Rights; Reports
20 Not Applicable
21 Policy Loans
22 Not Applicable
23 Safekeeping of the VUL Account's Assets
24 Not Applicable
25 Phoenix Home Life Mutual Insurance Company
26 Charges and Other Deductions; Investments of the VUL Account
27 Phoenix Home Life Mutual Insurance Company
28 Phoenix Home Life Mutual Insurance Company; The Directors and Executive Officers of
Phoenix Home Life Mutual Insurance Company
29 Not Applicable
30 Not Applicable
31 Not Applicable
32 Not Applicable
33 Not Applicable
34 Not Applicable
35 Phoenix Home Life Mutual Insurance Company
36 Not Applicable
37 Not Applicable
38 Sales of Policies
39 Sales of Policies
40 Not Applicable
41 Sales of Policies
42 Not Applicable
43 Not Applicable
44 Determination of Subaccount Values
45 Not Applicable
46 Determination of Subaccount Values
47 Allocation of Premium and Policy Value; Determination of Subaccount Values
48 Not Applicable
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
N-8B-2 ITEM CAPTION IN PROSPECTUS
- ----------- ---------------------
<S> <C>
49 Not Applicable
50 Not Applicable
51 Phoenix Home Life Mutual Insurance Company; The Policy; Charges and Deductions
52 Investments of the VUL Account
53 Federal Tax Considerations
54 Not Applicable
55 Not Applicable
56 Not Applicable
57 Not Applicable
58 Not Applicable
59 Not Applicable
</TABLE>
<PAGE>
THE ESTATE EDGE
SURVIVORSHIP VARIABLE
UNIVERSAL LIFE INSURANCE
POLICY
ISSUED BY
PHOENIX HOME LIFE MUTUAL
INSURANCE COMPANY
IF YOU HAVE ANY QUESTIONS, PLEASE CONTACT US AT:
[envelope] PHOENIX VARIABLE PRODUCTS MAIL OPERATIONS
PO Box 8027
Boston, MA 02266-8027
[phone] Tel. 800/541-0171
PROSPECTUS MAY 1, 1999
This Prospectus describes a survivorship variable universal life insurance
policy. The Policy provides lifetime insurance protection on the lives of two
Insureds. We pay the death benefit when the last insured dies.
The Policy is not a deposit or obligation of, underwritten or guaranteed by, any
financial institution or credit union. It is not federally insured or endorsed
by the Federal Deposit Insurance Corporation or any other state or federal
agency. Policy investments are subject to risk, including the fluctuation of
Policy Values and possible loss of principal invested or premiums paid.
The Securities and Exchange Commission has not approved or disapproved these
securities, nor passed upon the accuracy or adequacy of this prospectus. Any
representation to the contrary is a criminal offense.
THE PHOENIX EDGE SERIES FUND
MANAGED BY PHOENIX INVESTMENT COUNCIL, INC.
[diamond] Balanced
[diamond] Engemann Nifty Fifty
[diamond] Growth
[diamond] International
[diamond] Money Market
[diamond] Multi-Sector Fixed Income
[diamond] Phoenix Growth & Income
[diamond] Phoenix Value Equity
[diamond] Research Enhanced Index
[diamond] Schafer Mid-Cap Value
[diamond] Seneca Mid-Cap Growth
[diamond] Strategic Allocation
[diamond] Strategic Theme
MANAGED BY PHOENIX-ABERDEEN INTERNATIONAL ADVISOR, LLC
[diamond] Aberdeen New Asia
MANAGED BY DUFF & PHELPS INVESTMENT MANAGEMENT CO.
[diamond] Real Estate Securities
TEMPLETON VARIABLE PRODUCTS SERIES FUND
MANAGED BY TEMPLETON INVESTMENT COUNCIL, INC.
[diamond] Templeton Asset Allocation
[diamond] Templeton International
[diamond] Templeton Stock
MANAGED BY TEMPLETON ASSET MANAGEMENT, LTD.
[diamond] Templeton Developing Markets
MANAGED BY FRANKLIN MUTUAL ADVISERS, INC.
[diamond] Mutual Shares Investments
WANGER ADVISORS TRUST
MANAGED BY WANGER ASSET MANAGEMENT, L.P.
[diamond] Wanger Foreign Forty
[diamond] Wanger International Small Cap
[diamond] Wanger Twenty
[diamond] Wanger U.S. Small Cap
It may not be in your best interest to purchase a policy to replace an
existing life insurance policy or annuity contract. You must understand the
basic features of the proposed Policy and your existing coverage before you
decide to replace your present coverage. You must also know if the replacement
will result in any taxes.
This Prospectus is valid only if accompanied or preceded by current
prospectuses for the Funds. You should read and keep these prospectuses for
future reference.
1
<PAGE>
TABLE OF CONTENTS
Heading Page
- --------------------------------------------------------------------------------
THE ESTATE EDGE .......................................... 1
TABLE OF CONTENTS ........................................ 2
SPECIAL TERMS ............................................ 3
SUMMARY................................................... 4
PERFORMANCE HISTORY....................................... 5
PHOENIX AND THE VUL ACCOUNT .............................. 5
Phoenix ............................................... 5
The VUL Account ....................................... 5
The GIA................................................ 5
THE POLICY ............................................... 6
Introduction .......................................... 6
Eligible Purchasers ................................... 6
Flexible Premiums ..................................... 6
Allocation of Premium and Policy Value ................ 7
Right to Cancel Period ................................ 7
Temporary Insurance Coverage .......................... 7
Transfer of Policy Value .............................. 7
Determination of Subaccount Values .................... 8
Death Benefit ......................................... 8
Surrenders ............................................ 9
Policy Loans .......................................... 10
Lapse ................................................. 10
Additional Insurance Options .......................... 11
Additional Rider Benefits ............................. 11
INVESTMENTS OF THE VUL ACCOUNT ........................... 11
Participating Investment Funds ........................ 11
Investment Advisers.................................... 13
Services of the Advisers............................... 14
Reinvestment and Redemption ........................... 14
Substitution of Investments ........................... 14
CHARGES AND DEDUCTIONS ................................... 14
Premium Sales Charge................................... 14
Monthly Deduction ..................................... 14
Premium Taxes ......................................... 15
Federal Tax Charge..................................... 15
Mortality and Expense Risk Charge ..................... 15
Investment Management Charge .......................... 15
Other Charges ......................................... 15
GENERAL PROVISIONS ....................................... 16
Postponement of Payments .............................. 16
The Contract .......................................... 16
Suicide ............................................... 16
Incontestability ...................................... 16
Change of Owner or Beneficiary ........................ 16
Assignment ............................................ 17
Misstatement of Age or Sex ............................ 17
Surplus ............................................... 17
PAYMENT OF PROCEEDS ...................................... 17
Surrender and Death Benefit Proceeds .................. 17
Payment Options ....................................... 17
FEDERAL TAX CONSIDERATIONS ............................... 18
Introduction .......................................... 18
Phoenix's Tax Status .................................. 18
Policy Benefits ....................................... 18
Business-Owned Policies................................ 19
Modified Endowment Contracts .......................... 19
Limitations on Unreasonable Mortality
and Expense Charges ................................ 19
Qualified Plans ....................................... 20
Diversification Standards ............................. 20
Change of Ownership or Insured or Assignment .......... 20
Other Taxes ........................................... 20
VOTING RIGHTS ............................................ 20
The Funds ............................................. 20
Phoenix ............................................... 21
THE DIRECTORS AND EXECUTIVE OFFICERS OF PHOENIX .......... 21
SAFEKEEPING OF THE VUL ACCOUNT'S ASSETS .................. 22
SALES OF POLICIES ........................................ 22
STATE REGULATION ......................................... 22
REPORTS .................................................. 22
LEGAL PROCEEDINGS ........................................ 22
LEGAL MATTERS ............................................ 22
REGISTRATION STATEMENT ................................... 22
YEAR 2000 ISSUE........................................... 23
FINANCIAL STATEMENTS ..................................... 23
APPENDIX A ............................................... 24
APPENDIX B ............................................... 28
APPENDIX C................................................ 29
WE ARE OFFERING THIS PRODUCT ONLY WHERE WE MAY LAWFULLY DO SO. YOU SHOULD RELY
ONLY ON THE INFORMATION CONTAINED IN THIS DOCUMENT OR IN ONE THAT WE HAVE
REFERRED YOU TO. WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH INFORMATION
THAT IS DIFFERENT.
2
<PAGE>
SPECIAL TERMS
- --------------------------------------------------------------------------------
The following is a list of terms and their meanings when used in this
prospectus.
ATTAINED AGE: The age of the Insured on the birthday nearest the most recent
Policy Anniversary.
BENEFICIARY: The person or persons specified by the Policyowner as entitled to
receive the death benefits under a Policy.
CASH SURRENDER VALUE: The Policy Value less any surrender charge that would
apply on the date of surrender and less any Debt.
DEATH BENEFIT GUARANTEE: An additional benefit rider available with the Policy
that guarantees a death benefit equal to the initial Face Amount or the Face
Amount as later increased or decreased, if you pay the Minimum Required
Premiums. See "Additional Rider Benefits."
DEBT: Outstanding loans against a Policy plus accrued interest on any
outstanding loans.
FACE AMOUNT: The initial amount of insurance coverage.
FUNDS: The Phoenix Edge Series Fund, Wanger Advisors Trust and Templeton
Variable Products Series Fund.
GENERAL ACCOUNT: The general asset account of Phoenix.
GIA (GUARANTEED INTEREST ACCOUNT): An investment option under which amounts
deposited are guaranteed to earn a fixed rate of interest. Excess interest also
may be credited, in the sole discretion of Phoenix.
IN FORCE: Conditions under which the coverage under a Policy is in effect and
the Insureds' lives remain insured.
INSUREDS: The two persons on whose lives we issue the Policy.
ISSUE PREMIUM: The premium payment made in connection with issuing the Policy.
MONTHLY CALCULATION DAY: The first Monthly Calculation Day is the same day as
the Policy Date. Subsequent Monthly Calculation Days are the same day of each
month. If such day does not fall within a given month, the last day of that
month will be the Monthly Calculation Day.
NET ASSET VALUE: The worth of one share of a Series of a Fund at the end of a
valuation period. Net Asset Value is computed by adding the value of all a
Series' holdings plus other assets, minus liabilities and then dividing the
result by the number of shares outstanding.
NON-TRANSFERABLE GENERAL ACCOUNT ("NTGA"): A part of the General Account. The
cash value in the NTGA cannot decrease due to investment performance, but may
decrease due to deductions for policy charges. Interest is credited to the NTGA
at rates declared by Phoenix, but not less than 4%.
OWNER (POLICYOWNER, YOU, YOUR): The person(s) who purchase(s) a Policy.
PAYMENT DATE: The Valuation Date on which we receive a premium payment or loan
repayment, unless it is received after the close of the New York Stock Exchange
("NYSE"), in which case it will be the next Valuation Date.
PLANNED ANNUAL PREMIUM: The premium amount that the Policyowner agrees to pay
each Policy Year. It must be at least equal to the minimum premium required for
the Face Amount of insurance selected but may be no greater than the maximum
premium allowed for the Face Amount selected.
POLICY ANNIVERSARY: Each anniversary of the Policy Date.
POLICY DATE: The Policy Date as shown on the Schedule Page of the Policy. It is
the date from which we measure Policy Years and Policy Anniversaries.
POLICY MONTH: The period from one Monthly Calculation Day up to, but not
including, the next Monthly Calculation Day.
POLICY VALUE: The sum of a Policy's share in the values of each Subaccount of
the VUL Account plus the Policy's share in the values of the GIA.
POLICY YEAR: The first Policy Year is the one-year period from the Policy Date
up to, but not including, the first Policy Anniversary. Each succeeding Policy
Year is the one-year period from the Policy Anniversary up to, but not
including, the next Policy Anniversary.
PROPORTIONATE (PRO RATA): Amounts allocated to Subaccounts on a pro rata basis
are allocated by increasing (or decreasing) a Policy's share in the value of the
affected Subaccounts and GIA so that such shares maintain the same ratio to each
other before and after the allocation.
SERIES: A separate investment portfolio of the Fund.
SUBACCOUNTS: Accounts within the VUL Account to which non-loaned assets under a
Policy are allocated.
UNIT: A standard of measurement used to set the value of a Policy. The value of
a Unit for each Subaccount will reflect the investment performance of that
Subaccount and will vary in dollar amounts.
VALUATION DATE: For any Subaccount, each date on which we calculate the net
asset value of a Fund.
VALUATION PERIOD: For any Subaccount, the period in days from the end of one
Valuation Date through the next.
VPMO: The Variable Products Mail Operations division of Phoenix that receives
and processes incoming mail for Variable Products Operations.
VPO: Variable Products Operations.
VUL ACCOUNT (ACCOUNT): Phoenix Home Life Variable Universal Life Account, a
separate account of the Company.
WE (OUR, US, COMPANY, PHOENIX): Phoenix Home Life Mutual Insurance Company,
Hartford, Connecticut.
3
<PAGE>
SUMMARY
- --------------------------------------------------------------------------------
This is a summary of the Policy and does not contain all of the detailed
information that may be important to you. You should read the entire Prospectus
carefully before making any decision.
INVESTMENT FEATURES
FLEXIBLE PREMIUMS
The only premiums you have to pay are the Issue Premium and any payments
required to prevent the policy from lapse. See "Flexible Premiums" and "Lapse."
ALLOCATION OF PREMIUMS AND POLICY VALUE
After we deduct certain charges from your premium payment, we will invest
the balance in one or more of the Subaccounts of the VUL Account and/or the GIA
as you will have instructed us.
You may make transfers into the GIA and among the Subaccounts at anytime.
Transfers from the GIA are subject to the rules discussed in "Appendix B" and
under "Transfer of Policy Value."
The Policy Value varies with the investment performance of the Funds and is
not guaranteed.
The Policy Value allocated to the GIA will depend on deductions taken from
the GIA to pay expenses and will accumulate interest at rates we periodically
establish, but never less than 4%.
LOANS AND SURRENDERS
[diamond] Generally, you may take loans against 90% of the Policy's Cash
Surrender Value subject to certain conditions. See "Policy Loans."
[diamond] You may surrender part of the policy anytime. A transaction
charge of the lesser of $25 or 2% of the partial surrender amount will apply.
[diamond] You may fully surrender this Policy anytime for its Cash
Surrender Value. See "Surrenders."
INSURANCE PROTECTION FEATURES
DEATH BENEFITS
[diamond] Both a fixed and variable benefit is available under the Policy.
o The fixed benefit is equal to the Policy's Face Amount (Option A)
o The variable benefit equals the Face Amount plus the Policy Value
(Option B)
[diamond] After the first year, you may reduce the Face Amount. Certain
restrictions apply, and generally, the minimum Face Amount is
$250,000.
[diamond] The death benefit is payable when the last insured dies. See
"Death Benefit."
DEATH BENEFIT GUARANTEE
You may elect a guaranteed death benefit. The amount of the guaranteed death
benefit is equal to the initial Face Amount. The Death Benefit Guarantee may not
be available in some states.
DEATH BENEFIT AT ENDOWMENT
After age 100 of the younger Insured, the death benefit equals the Policy
Value, and no more monthly deductions will be made. This allows you to keep the
Policy In Force until the second death.
ADDITIONAL BENEFITS
The following additional benefits are available by rider:
[diamond] Disability Benefit
[diamond] Four Year Survivorship Term
[diamond] Conditional Exchange Option
[diamond] Policy Split Option
Availability of these Riders depends upon state approval and may involve an
extra cost.
DEDUCTIONS AND CHARGES
FROM PREMIUM PAYMENTS
[diamond] Taxes
o State Premium Taxes--2.25%
o Federal Tax Charge--1.50%
[diamond] Premium sales charge
o Policy Year 1 = 20% of premiums paid up to one target annual premium
("TAP") and 5% of premiums paid in excess of the TAP.
o Policy Years 2 through 10 = 5% of premiums
o Policy Years 11 and after = 0%
See "Deductions and Charges" for a detailed discussion, including an
explanation of TAP.
FROM POLICY VALUE
[diamond] Issue Expense Charge--$600. Deducted in
the first Policy Year only and payable in 12 monthly
installments of $50.
[diamond] Administrative Charge--Deducted monthly in Policy Years 1
through 10 only. Amount deducted varies by Face Amount.
[diamond] Cost of Insurance--Amount deducted monthly. Cost of insurance
rates apply to the Policy and certain riders. The rates vary and
are based on certain personal factors such as sex, attained age
and risk class of the Insureds.
[diamond] Transaction Charge--may be deducted for partial surrenders and
certain transfers.
[diamond] Surrender Charge--Deducted if the Policy is surrendered within
the first 10 Policy Years. See "Surrender Charge."
FROM THE VUL ACCOUNT
Mortality And Expense Risk Charge
[diamond] Policy Years 1 through 15--.80% annually
[diamond] Policy Year 16 and after--.25% annually.
FROM THE FUND
The assets of the VUL Account are used to purchase, at Net Asset Value,
shares of your selected underlying Funds. The Net
4
<PAGE>
Asset Value reflects investment management fees and other direct expenses of the
Fund. See "Investment Management Charge."
See "Charges and Deductions" for a more detailed description of how each is
applied.
ADDITIONAL INFORMATION
CANCELLATION RIGHT
You have the right to review the Policy. If you are not satisfied with it,
you may cancel the Policy:
[diamond] within 10 days after you receive the Policy, or
[diamond] within 10 days after we mail or deliver a written notice
telling you about your right to cancel, or
[diamond] within 45 days of completing the application;
whichever is latest.
See "Right to Cancel Period."
LAPSE
The Policy will remain In Force as long as the Policy Value or Cash
Surrender Value is enough to pay the necessary monthly charges incurred under
the Policy. When the Cash Value is no longer enough, the policy lapses, or ends.
We will let you know of an impending lapse situation. We will give you the
opportunity to keep the Policy In Force by paying a specified amount.
TAX EFFECTS
Generally, under current federal income tax law, death benefits are not
subject to income tax. Earnings on the premiums invested in the VUL Account or
the GIA are not subject to income tax until there is a distribution from the
Policy. Loans, partial surrenders or Policy termination may result in
recognition of income for tax purposes.
VARIATIONS
The Policy is subject to laws and regulations in every state where the
Policy is sold. Therefore, the terms of the Policy may vary from state to state.
PERFORMANCE HISTORY
- --------------------------------------------------------------------------------
We may include the performance history of the VUL Account Subaccounts in
advertisements, sales literature or reports. Performance information about each
Subaccount is based on past performance only and is not an indication of future
performance. See "Appendix A" for more information.
PHOENIX AND THE VUL ACCOUNT
- --------------------------------------------------------------------------------
PHOENIX
Phoenix is a mutual life insurance company originally chartered in
Connecticut in 1851. It was redomiciled to New York in 1992. Its executive
office is located at One American Row, Hartford, Connecticut 06102, and its main
administrative office is located at 100 Bright Meadow Boulevard, Enfield,
Connecticut 06083-1900. Its New York principal office is located at 10 Krey
Boulevard, East Greenbush, New York 12144. Phoenix is the nation's 9th largest
mutual life insurance company and has consolidated assets of $18.5 billion.
Phoenix sells insurance policies and annuity contracts through its own field
force of full time agents and through brokers. Its operations are conducted in
all 50 states, the District of Columbia, Canada and Puerto Rico.
THE VUL ACCOUNT
The VUL Account is a separate account of Phoenix formed on June 17, 1985 and
governed under the laws of New York. It is registered as a unit investment trust
under the Investment Company Act of 1940 ("1940 Act"), and it meets the
definition of a "separate account" under the 1940 Act. Such registration does
not involve supervision of the management of the VUL Account or Phoenix by the
SEC.
The VUL Account is divided into Subaccounts, each of which is available for
allocation of Policy Value. Each Subaccount will invest solely in shares of a
specific series of a mutual fund. In the future Phoenix may establish additional
Subaccounts, which will be made available to existing Policyowners to the extent
and on a basis decided by Phoenix. See "Investments of the VUL
Account--Participating Investment Funds."
Phoenix does not guarantee the investment performance of the VUL Account or
any of its Subaccounts. Contributions to the overall Policy Value allocated to
the VUL Account depend on the chosen Fund's investment performance. Thus, you
bear the full investment risk for all monies you invest in the VUL Account.
The VUL Account is part of the general business of Phoenix, but the gains or
losses of the VUL Account belong solely to the VUL Account. The gains or losses
of any other business Phoenix may conduct do not affect the VUL Account. Under
New York law, the assets of the VUL Account may not be taken to pay liabilities
arising out of any other business Phoenix may conduct. Nevertheless, all
obligations arising under the Policy (such as paying death benefits) are general
corporate obligations of Phoenix.
THE GIA
The GIA is not part of the VUL Account. It is accounted for as part of the
General Account. Phoenix reserves the right to limit total deposits, including
transfers, to the GIA to no more than $250,000 during any one-week period.
Phoenix will credit interest daily on the amounts you allocate to the GIA. The
credited rate will be the same for all monies deposited at the same time. The
loaned portion of the GIA will be credited interest at an effective annual fixed
rate of 2% (4% in New York). Interest on the unloaned portion of the GIA will be
credited at an effective annual rate of not less than 4%.
Biweekly, Phoenix sets the interest rate that will apply to any net premium
or transferred amounts deposited to the unloaned portion of the GIA. That rate
will remain in effect for such deposits for an initial guarantee period of one
full year from the date of deposit. Upon the end of the initial one-year
guarantee period (and each subsequent one-year guarantee period thereafter), the
rate to
5
<PAGE>
be applied to any deposits whose guarantee period has just ended will be the
same rate then being applied to new deposits to the GIA. This rate will then
remain in effect for a guaranteed period of one full year from the date the new
rate is applied.
In general, you can make only one transfer per year from the GIA. The amount
that can be transferred out is limited to the greater of $1,000 or 25% of the
value in the GIA as of the date of the transfer. If you elect the Systematic
Transfer Program, approximately equal amounts may be transferred out of the GIA.
Also, the total value of the GIA may be transferred out of the GIA to one or
more of the Subaccounts of the VUL Account over a consecutive four-year period
according to the following schedule:
[diamond] Year One: 25%
[diamond] Year Two: 33% of remaining value
[diamond] Year Three: 50% of remaining value
[diamond] Year Four: 100% of remaining value
Transfers into the GIA and among the Subaccounts of the VUL Account may be
made at any time. Transfers from the GIA are subject to the rules discussed in
"Appendix B" and "Transfer of Policy Value--Systematic Transfer Program."
THE POLICY
- --------------------------------------------------------------------------------
INTRODUCTION
The Policy is a flexible premium variable life insurance policy issued on
the lives of two Insureds. The Policy has a death benefit, Cash Surrender Value
and loan privilege as does a traditional fixed benefit whole life policy. The
Policy differs from a fixed benefit whole life policy, however, because you can
allocate your premium into one or more of several Subaccounts of the VUL Account
or the GIA. Each Subaccount of the VUL Account, in turn, invests its assets
exclusively in a Series of the Funds. The Policy Value varies according to the
investment performance of the Series to which premiums have been allocated.
ELIGIBLE PURCHASERS
Any person between the ages of 18 and 85 is eligible to be insured under a
newly purchased Policy after providing suitable evidence of insurability. You
can purchase a Policy to insure the lives of two other individuals, provided
that you have the Insureds' consents and a legally recognized interest for
insuring their lives. A Policy could, for example, be purchased on the lives of
spouses, family members, business partners or other related groups.
FLEXIBLE PREMIUMS
The Issue Premium required depends on a number of factors, such as:
[diamond] age
[diamond] sex
[diamond] rate class of proposed insured
[diamond] desired Face Amount
[diamond] supplemental benefit
[diamond] planned premiums
The minimum Issue Premium generally is 1/6 of the Planned Annual Premium.
Both Insureds must be alive when the Issue Premium is paid, and it is due on the
Policy Date. After the Issue Premium is paid, although premiums are flexible,
the amount and frequency of Planned Annual Premiums are as shown on the Schedule
Page of the Policy. You decide the amount of Planned Annual Premium (within
limits set by us) when you apply for the Policy. The Issue Premium payment
should be delivered to your registered representative for forwarding to our
Underwriting Department. Additional payments should be sent to VPMO.
Premium payments received by us will be reduced by a 2.25% charge for state
premium tax and also reduced by a federal tax charge of 1.50%. The Issue Premium
also will be reduced by the issue expense charge deducted in equal monthly
installments over a 12-month period. Each installment will be taken from the
subaccounts on a pro rata basis. Any unpaid balance of the issue expense charge
will be paid to Phoenix upon Policy Lapse or termination.
Premium payments received during a grace period also will be reduced by the
amount needed to cover any monthly deductions during the grace period. The
remainder will be applied on the Payment Date to the various Subaccounts of the
VUL Account or to the GIA, based on the premium allocation schedule elected in
the application for the Policy or by your most recent instructions. See
"Non-Systematic Transfers and Changes in Payment Allocations."
The number of units credited to a Subaccount of the VUL Account will be
determined by dividing the amount of the net premium applied to that Subaccount
by the unit value of the Subaccount on the Payment Date.
You may increase or decrease the Planned Annual Premium amount (within
limits) or payment frequency at any time by written notice to VPMO. We reserve
the right to limit increases to such maximums as we may establish and change
from time to time. Additional premium payments may be made at any time. Each
premium payment must at least equal $25 or, if made during a grace period, the
payment must equal the amount needed to prevent lapse of the Policy.
The Policy contains a total premium limit as shown on the Schedule Page.
This limit is applied to the sum of all premiums paid under the Policy. If the
total premium limit is exceeded, you will receive the excess, with interest at
an annual rate of not less than 4%, not later than 60 days after the end of the
Policy Year in which the limit was exceeded. The Policy Value then will be
adjusted to reflect the refund. To pay such refund, amounts taken from each
Subaccount or the GIA will be done in the same manner as for monthly deductions.
You may write to us and give us different instructions. The total premium limit
may be exceeded if additional premium is needed to prevent lapse or if we
subsequently determine that additional premium would be permitted by federal
laws or regulations.
You may authorize your bank to draw $25 or more monthly from your personal
checking account to be allocated among the
6
<PAGE>
available Subaccounts or the GIA. Your monthly payment will be invested
according to your most recent instructions on file at VPO.
Policies sold to officers, directors and employees of Phoenix (and their
spouses and children) will be credited with an amount equal to the first-year
commission that would apply on the amount of premium contributed. This option
also is available to career agents of Phoenix (and their spouses and children).
ALLOCATION OF PREMIUM AND POLICY VALUE
We will generally allocate the Issue Premium (less applicable charges) to
the VUL Account or to the GIA upon receipt of a completed application, pursuant
to the allocation instructions in the application for the Policy. However,
Policies issued in certain states, and Policies which are intended to replace
existing insurance, are issued with a Temporary Money Market Allocation
Amendment. Under this Amendment, we temporarily allocate the entire Issue
Premium paid less applicable charges (along with any other premiums paid during
the Right to Cancel Period) to the Money Market Subaccount of the VUL Account,
and, at the end of the Right to Cancel Period, the value of the Money Market
Subaccount is allocated among the Subaccounts of the VUL Account or to the GIA
pursuant to the allocation instructions you made in the application for
insurance.
RIGHT TO CANCEL PERIOD
You have the right to review the Policy. If you are not satisfied with it,
you may cancel the Policy:
[diamond] by mailing it to us within 10 days after you receive it (or
longer in some states); or
[diamond] within 10 days after we mail or deliver a written notice telling
you about your right to cancel; or
[diamond] within 45 days after completing the application,
whichever occurs latest (the "Right to Cancel Period").
We treat a returned Policy as if we never issued it and, except for Policies
issued without a Temporary Money Market Allocation Amendment, we will return the
sum of the following as of the date we receive the returned Policy: (1) the then
current Policy Value less any unpaid loans and loan interest; plus (2) any
monthly deductions, partial surrender fees and other charges made under the
Policy. For Policies issued with the Temporary Money Market Amendment the amount
returned will equal any premiums paid less any unrepaid loans and loan interest,
and less any partial surrender amounts paid.
We retain the right to decline to process an application within seven days
of our receipt of the completed application for insurance. If we decline to
process the application, we will return the premium paid. Even if we have
approved the application for processing, we retain the right to decline to issue
the Policy. If we decline to issue the Policy, we will refund to you the same
amount as would have been refunded under the Policy had it been issued but
returned for refund during the Right to Cancel Period.
TEMPORARY INSURANCE COVERAGE
On the date the application for a Policy is signed and submitted with the
Issue Premium, we issue a Temporary Insurance Receipt to you. Under the
Temporary Insurance Receipt, the insurance protection applied for (subject to
the limits of liability and subject to the terms set forth in the Policy and in
the Receipt) takes effect on the date of the application.
TRANSFER OF POLICY VALUE
SYSTEMATIC TRANSFER PROGRAM
You may elect to transfer funds automatically among the Subaccounts or the
unloaned portion of the GIA on a monthly, quarterly, semiannual or annual basis
under the Systematic Transfer Program for Dollar Cost Averaging ("Systematic
Transfer Program"). Under this Systematic Transfer Program, the minimum transfer
amounts are $25 monthly, $75 quarterly, $150 semiannually or $300 annually. You
must have an initial value of $1,000 in the GIA or the Subaccount from which
funds will be transferred ("Sending Subaccount") and if the value in that
Subaccount or the GIA drops below the amount to be transferred, the entire
remaining balance will be transferred and all systematic transfers will stop.
Funds may be transferred from only one Sending Subaccount or the GIA, but may be
allocated to more than one Subaccount ("Receiving Subaccounts"). Under the
Systematic Transfer Program, you may make more than one transfer per Policy Year
from the GIA. These transfers must be in approximately equal amounts and made
over a minimum 18-month period.
Only one Systematic Transfer Program can be active at any time. After a
Systematic Transfer Program has ended, you can call VPO at 1-800-541-0171 to
begin a new Systematic Transfer Program.
All transfers under the Systematic Transfer Program will be made on the
basis of the GIA and Subaccount values on the first day of the month following
our receipt of the transfer request. If the first day of the month falls on a
holiday or weekend, then the transfer will be processed on the next business
day.
NON-SYSTEMATIC TRANSFERS AND CHANGES IN PAYMENT ALLOCATIONS
Transfers among available Subaccounts or the GIA and changes in premium
payment allocations may be requested in writing or by calling 1-800-541-0171,
between the hours of 8:30 a.m. and 4:00 p.m. Eastern Time. Written requests for
transfers will be executed on the date the request is received at VPMO.
Telephone transfers will be effective on the date the request is made except as
noted below. Unless you elect in writing not to authorize telephone transfers or
premium allocation changes, telephone transfer orders and premium allocation
changes also will be accepted on your behalf from your registered
representative. Phoenix and Phoenix Equity Planning Corporation ("PEPCO"), the
national distributor for Phoenix, will employ reasonable procedures to confirm
that telephone instructions are genuine. They will require verification of
account information and will record telephone instructions on tape. All
telephone transfers will be confirmed in writing to you. To the extent that
Phoenix and PEPCO fail to follow procedures reasonably designed to prevent
unauthorized transfers, Phoenix and PEPCO may be liable for following telephone
instructions for transfers that prove to be fraudulent. However, you will bear
the risk of loss resulting from instructions entered by an unauthorized
third-party that Phoenix and PEPCO reasonably believe to be genuine. The
telephone
7
<PAGE>
transfer and allocation change privileges may be modified or terminated at any
time. During times of extreme market volatility these privileges may be
difficult to exercise. In such cases, you should submit a written request.
Although currently there is no charge for transfers, in the future, we may
charge a fee of $10 for each transfer after the first two transfers in a Policy
Year.
We reserve the right to refuse to transfer amounts less than $500 unless (1)
the entire balance in the Subaccount or the GIA is being transferred or (2) the
transfer is part of the Systematic Transfer Program.
We also reserve the right to prohibit a transfer to any Subaccount of the
VUL Account if the value of your investment in that Subaccount immediately after
the transfer would be less than $500. We further reserve the right to require
that the entire balance of a Subaccount or the GIA be transferred if the value
of your investment in that Subaccount would, immediately after the transfer, be
less than $500.
You may make only one transfer per Policy Year from the unloaned portion of
the GIA unless (1) the transfer(s) are made as part of a Systematic Transfer
Program, or (2) we agree to make an exception to this rule. The amount you may
transfer cannot exceed the greater of $1,000 or 25% of the value of the unloaned
portion of the GIA at the time of the transfer. In addition, you may transfer
the total value allocated to the unloaned portion of the GIA out of the GIA to
one or more of the Subaccounts over a consecutive four-year period according to
the following schedule:
[diamond] Year One: 25% of the total value
[diamond] Year Two: 33% of the remaining value
[diamond] Year Three: 50% of the remaining value
[diamond] Year Four:100% of the remaining value
A non-systematic transfer from the unloaned portion of the GIA will be
processed on the day such request is received by VPMO.
Transfers into the GIA and among the Subaccounts may be made anytime. We
reserve the right to limit the number of Subaccounts you may invest in to a
total of 18 at any one time or over the life of the Policy. We may limit you to
less than 18 if we are required to do so by any federal or state law.
Because excessive exchanges between Subaccounts can hurt Fund performance,
we reserve the right to temporarily or even permanently terminate exchange
privileges or reject any specific exchange order from anyone whose transactions
appear to us to follow a timing pattern, including those who request more than
one exchange out of a Subaccount within any 30-day period. We will not accept
batched transfer instructions from registered representatives (acting under
powers of attorney for multiple Policy Owners), unless the registered
representative's broker-dealer firm and Phoenix have entered into a third-party
transfer service agreement.
If a policy has been issued with a Temporary Money Market Allocation
Amendment, no transfers may be made until the end of the Right to Cancel Period.
DETERMINATION OF SUBACCOUNT VALUES
We establish the unit value of each Subaccount of the VUL Account on the
first Valuation Date of that Subaccount. The unit value of a Subaccount on any
other Valuation Date is determined by multiplying the unit value of that
Subaccount on the just prior Valuation Date by the Net Investment Factor for
that Subaccount for the then current Valuation Period. The unit value of each
Subaccount on a day other than a Valuation Date is the unit value on the next
Valuation Date. Unit values are carried to six decimal places. The unit value of
each Subaccount on a Valuation Date is determined at the end of that day.
The Net Investment Factor for each Subaccount is determined by the
investment performance of the assets held by the Subaccount during the Valuation
Period. Each valuation will follow applicable law and accepted procedures. The
Net Investment Factor is determined by the formula:
(A) + (B) - (D) where:
---------
(C)
(A) = The value of the assets in the Subaccount on the current Valuation
Date, including accrued net investment income and realized and
unrealized capital gains and losses, but excluding the net value of
any transactions during the current Valuation Period.
(B) = The amount of any dividend (or, if applicable, any capital gain
distribution) received by the Subaccount if the "ex-dividend" date for
shares of the Fund occurs during the current Valuation Period.
(C) = The value of the assets in the Subaccount as of the just prior
Valuation Date, including accrued net investment income and realized
and unrealized capital gains and losses, and including the net value
of all transactions during the Valuation Period ending on that date.
(D) = The sum of the following daily charges multiplied by the number of
days in the current Valuation Period:
1. The mortality and expense risk charge; and
2. The charge, if any, for taxes and reserves for taxes on investment
income, and realized and unrealized capital gains.
DEATH BENEFIT
GENERAL
The death benefit under Option A equals the Policy's Face Amount on the date
of the death of the last surviving Insured or, if greater, the minimum death
benefit on that date.
8
<PAGE>
Under Option B, the death benefit equals the Policy's Face Amount on the
date of the death of the last surviving Insured plus the Policy Value.
Under either Option, the minimum death benefit is the Policy Value on the
date of death of the last surviving Insured increased by a percentage determined
from a table contained in the Policy. This percentage will be based on the
Insured's attained age at the beginning of the Policy Year in which the death
occurs. If no option is elected, Option A will apply.
GUARANTEED DEATH BENEFIT OPTION
A Guaranteed Death Benefit Rider is available. Under this Policy rider, if
you pay the required premium each year as specified in the rider, the death
benefit selected will be guaranteed for a certain specified number of years,
regardless of the investment performance of the Policy, and will equal either
the initial Face Amount or the Face Amount as later changed by decreases. To
keep this guaranteed death benefit In Force; there may be limitations on the
amount of partial surrenders or decreases in Face Amount permitted.
After the first 10 Policy Years, there will be a monthly charge equal to
$0.01 per $1,000 of Face Amount for policies issued with a Guaranteed Death
Benefit Rider.
PARTIAL SURRENDER AND DECREASES IN FACE AMOUNT: EFFECT ON DEATH BENEFIT
A partial surrender or a decrease in Face Amount generally decreases the
death benefit. Upon a decrease in Face Amount or partial surrender, a partial
surrender charge will be deducted from Policy Value based on the amount of the
decrease or partial surrender. If the change is a decrease in Face Amount, the
death benefit under a Policy would be reduced on the next Monthly Calculation
Day. If the change is a partial surrender, the death benefit under a Policy
would be reduced immediately. A decrease in the death benefit may have certain
tax consequences. See "Federal Tax Considerations."
REQUESTS FOR DECREASE IN FACE AMOUNT
You may request a decrease in Face Amount at any time after the first Policy
Year. Unless we agree otherwise, the decrease must be at least $25,000 and the
Face Amount remaining after the decrease must be at least $250,000. All Face
Amount decrease requests must be in writing and will be effective on the first
Monthly Calculation Day following the date we approve the request. A partial
surrender charge will be deducted from the Policy Value based on the amount of
the decrease. The charge will equal the applicable surrender charge that would
apply to a full surrender multiplied by a fraction. The fraction is equal to the
decrease in Face Amount divided by the Face Amount of the Policy before the
decrease.
SURRENDERS
GENERAL
At any time during the lifetime of the Insureds and while the Policy is In
Force, you may partially or fully surrender the Policy by sending to VPMO a
written release and surrender in a form satisfactory to us. We may also require
you to send the Policy to us. The amount available for surrender is the Cash
Surrender Value at the end of the Valuation Period during which the surrender
request is received at VPMO.
Upon partial or full surrender, we generally will pay to you the amount
surrendered within seven days after we receive the written request for the
surrender. Under certain circumstances, the surrender payment may be postponed.
See "General Provisions--Postponement of Payments." For the federal tax effects
of partial and full surrenders, see "Federal Tax Considerations."
FULL SURRENDERS
If the Policy is being fully surrendered, the Policy itself must be returned
to us at VPMO, along with the written release and surrender of all claims in a
form satisfactory to us. You may elect to have the amount paid in a lump sum or
under a payment option. See "Surrender Charge" and "Payment Options."
PARTIAL SURRENDERS
You may obtain a partial surrender of the Policy by requesting that part of
the Policy's Cash Surrender Value be paid. You may do this at any time during
the lifetime of the Insureds while the Policy is In Force with a written request
to VPMO. We may require that the Policy be returned before payment is made. A
partial surrender will be effective on the date the written request is received
or, if required, the date the Policy is received by us. Surrender proceeds may
be applied under any of the payment options described under "Payment of
Proceeds--Payment Options."
We reserve the right not to allow partial surrenders of less than $500. In
addition, if the share of the Policy Value in any Subaccount or in the GIA that
would be reduced as a result of a partial surrender and would be less than $500,
we may require the entire remaining balance in that Subaccount or the GIA be
surrendered.
Upon a partial surrender, the Policy Value will be reduced by the sum of the
following:
(1) The Partial Surrender Amount Paid. This amount comes from a reduction in
the Policy's share in the value of each Subaccount or the GIA based on
the allocation requested at the time of the partial surrender. If no
allocation request is made, the withdrawals from each Subaccount will be
made in the same manner as that provided for monthly deductions.
(2) The Partial Surrender Fee. This fee is the lesser of $25 or 2% of the
partial surrender amount paid. The assessment to each Subaccount or the
GIA will be made in the same manner as provided for the partial
surrender amount paid.
(3) A Partial Surrender Charge. This charge is equal to a pro rata portion
of the applicable surrender charge that would apply to a full surrender,
determined by multiplying the applicable surrender charge by a fraction
(equal to the partial surrender amount payable divided by the result of
subtracting the applicable surrender charge from the Policy Value). This
amount is assessed against the Subaccount or the GIA in the same manner
as provided for the partial surrender amount paid.
9
<PAGE>
The Cash Surrender Value will be reduced by the partial surrender amount
paid plus the partial surrender fee. The Face Amount of the Policy will be
reduced by the same amount as the Policy Value is reduced as described above.
POLICY LOANS
Generally, while the Policy is In Force, a loan may be taken against the
Policy up to the available loan value. The loan value on any day is 90% of the
Policy Value reduced by an amount equal to the surrender charge. The available
loan value is the loan value on the current day less any outstanding Debt.
The amount of any loan will be added to the loaned portion of the GIA and
subtracted from the Policy's share of the Subaccounts or the unloaned portion of
the GIA, based on the allocation requested at the time of the loan. The total
reduction will equal the amount added to the loaned portion of the GIA.
Allocations generally must be expressed in terms of whole percentages. If no
allocation request is made, the amount subtracted from the share of each
Subaccount or the unloaned portion of the GIA will be determined in the same
manner as provided for monthly deductions. Interest will be credited and the
loaned portion of the GIA will increase at an effective annual rate of 2% (4% in
New York only), compounded daily and payable in arrears. At the end of each
Policy Year and at the time of any Debt repayment, interest credited to the
loaned portion of the GIA will be transferred to the unloaned portion of the
GIA.
Debt may be repaid at any time during the lifetime of the Insureds while the
Policy is In Force. Any Debt repayment received by us during a grace period will
be reduced to pay any overdue monthly deductions and only the balance will be
applied to reduce the Debt. Such balance will first be used to pay any
outstanding accrued loan interest, and then will be applied to reduce the loaned
portion of the GIA. The unloaned portion of the GIA will be increased by the
same amount the loaned portion is decreased. If the amount of a loan repayment
exceeds the remaining loan balance and accrued interest, the excess will be
allocated among the Subaccounts as you may request at the time of the repayment
and, if no allocation request is made, according to the most recent premium
allocation schedule on file.
PAYMENTS RECEIVED BY US FOR THE POLICY WILL BE APPLIED DIRECTLY TO REDUCE
OUTSTANDING DEBT, UNLESS SPECIFIED AS A PREMIUM PAYMENT BY YOU. Until the Debt
is fully repaid, additional Debt repayments may be made at any time during the
lifetime of the Insureds while the Policy is In Force.
Failure to repay a policy loan or to pay loan interest will not terminate
the Policy unless the Policy Value becomes insufficient to maintain the Policy
In Force.
The proceeds of Policy loans may be subject to federal income tax. See
"Federal Tax Considerations."
In the future, Phoenix may not allow Policy loans of less than $500, unless
such loan is used to pay a premium on another Phoenix policy.
You will pay interest on the loan at an effective annual rate, compounded
daily and payable in arrears. The loan interest rates in effect are as follows:
FOR POLICIES ISSUED IN ALL STATES EXCEPT NEW YORK
Policy Years 1-10: 4%
Policy Years 11-15: 3%
Policy Years 16 and thereafter: 2 1/2%
FOR POLICIES ISSUED IN NEW YORK ONLY
Policy Years 1-10: 6%
Policy Years 11-15: 5%
Policy Years 16 and thereafter: 4 1/2%
At the end of each Policy Year, any interest due on the Debt will be treated
as a new loan and will be offset by a transfer from your Subaccounts and the
unloaned portion of the GIA to the loaned portion of the GIA.
A Policy loan, whether or not repaid, has a permanent effect on the Policy
Value because the investment results of the Subaccounts or unloaned portion of
the GIA will apply only to the amount remaining in the Subaccounts or the
unloaned portion of the GIA. The longer a loan is outstanding, the greater the
effect is likely to be. The effect could be favorable or unfavorable. If the
Subaccounts or the unloaned portion of the GIA earn more than the annual
interest rate for funds held in the loaned portion of the GIA, Policy Value does
not increase as rapidly as it would have had no loan been made. If the
Subaccounts or the GIA earn less than the annual interest rate for funds held in
the loaned portion of the GIA. Policy Value is greater than it would have been
had no loan been made. A Policy loan, whether or not repaid, also has a similar
effect on the Policy's Death Benefit due to any resulting differences in Cash
Surrender Value.
LAPSE
Unlike conventional life insurance policies, the payment of the Issue
Premium, no matter how large, or the payment of additional premiums will not
necessarily continue the Policy In Force to its Maturity Date.
If on any Monthly Calculation Day during the first three Policy Years, the
Policy Value is insufficient to cover the monthly deduction, a grace period of
61 days will be allowed for the payment of an amount equal to three times the
required monthly deduction. If on any Monthly Calculation Day during any
subsequent Policy Year, the Cash Surrender Value (which should have become
positive) is less than the required monthly deduction, a grace period of 61 days
will be allowed for the payment of an amount equal to three times the required
monthly deduction. However, during the first five Policy Years or until the Cash
Surrender Value becomes positive for the first time, the Policy will not lapse
as long as all premiums planned at issue have been paid.
During the grace period the Policy will continue In Force but Subaccount
transfers, loans, partial or full surrenders will not be permitted. Failure to
pay the additional amount within the grace period will result in lapse of the
Policy, but not before 30 days
10
<PAGE>
after we have mailed written notice to you. If a premium payment for the
additional amount is received by us during the grace period, any amount of
premium over what is required to prevent lapse will be allocated among the
Subaccounts or to the GIA according to the then current premium allocation
schedule. In determining the amount of "excess" premium to be applied to the
Subaccounts or the GIA, we will deduct the premium tax and the amount needed to
cover any monthly deductions made during the grace period. If the last surviving
Insured dies during the grace period, the death benefit will equal the amount of
the death benefit immediately prior to the commencement of the grace period.
ADDITIONAL INSURANCE OPTIONS
While the Policy is In Force, you will have the option to purchase
additional insurance on the same Insureds with the same guaranteed rates as the
Policy without being assessed an issue expense charge. We will require evidence
of insurability and charges will be adjusted for the Insured's new attained age
and any change in risk classification.
ADDITIONAL RIDER BENEFITS
You may elect additional benefits under a Policy. These benefits are
cancelable by you at any time. A charge may be deducted monthly from the Policy
Value for each additional rider benefit chosen. More details will be included in
the form of a rider to the Policy if any of these benefits is chosen. The
following benefits are currently available (if approved in your state).
Additional riders may be available as described in the Policy.
DISABILITY BENEFIT RIDER
This rider is available for one or both Insureds. On disability of a covered
insured before age 65, monthly deductions will be waived and an additional
Specified Amount (if any) will be credited, as long as he/she remains disabled
(but not for more than the longer of one year or to age 65, if disability
commenced after age 60).
The rider terminates at the Insured's attained age 65. However, benefits
will continue to be paid for the covered Insured's lifetime if he or she has
been continuously disabled under the terms of the rider from attained age 60 to
age 65.
FOUR-YEAR SURVIVORSHIP TERM
This rider provides a level death benefit on the second death if
both Insureds die within four years of policy issue. This rider is not
convertible into any other policy or coverage.
The rider face amount will be up to 125% of the Policy's initial face
amount.
POLICY SPLIT OPTION RIDER
This rider provides for the exchange of the policy into two single
life policies. At the time of the exchange, the Policy can be split by any
percentage subject to minimum requirements of the single life policies. There is
no charge for this rider, but you must show satisfactory evidence of
insurability.
CONDITIONAL EXCHANGE OPTION RIDER
This rider provides for the exchange of the Policy for two new
single policies, without evidence of insurability, for either of the following
events:
1. the divorce of the Insureds, or
2. major change in the federal estate tax law.
Both Insureds must be alive on the date of exchange and there must continue
to be insurable interest.
GUARANTEED DEATH BENEFIT RIDER
This rider guarantees the face amount of coverage even if the Policy
Value is insufficient to cover the monthly deduction.
For the first 10 policy years, the monthly guarantee premium is 1/12 of the
Target Annual Premium. For Policy year 11 and thereafter, the monthly guarantee
premium is 1/12 of the Guideline Level Premium (as defined in Internal Revenue
Code Section 7702).
The rider will remain in effect if one of three conditions is met monthly.
Otherwise, the rider will lapse and the underlying Policy will continue without
the rider benefits or charges. The three conditions are:
1. Total Cumulative Premium Test - the total premium paid less the sum
of all surrender amounts is not less than the cumulative sum of all
monthly guarantee premiums since policy issue.
2. Tabular Account Value Test - the Policy's Cash Surrender Value is
not less than the Policy's Tabular Account Value (as listed on
Policy's schedule pages) on the Policy Anniversary on or immediately
preceding the Monthly Calculation Day.
3. Annual Premium Test - the total premium paid during the Policy Year,
less surrenders, is not less than the sum of all monthly guarantee
premiums applicable each month since the Policy Year began.
CONVERSION TO UNIVERSAL LIFE RIDER
This rider permits you to convert from a variable universal life policy to a
fixed universal life policy by transferring all cash value to the
Non-Transferable General Account ("NTGA"). You may make this election on or
after the 15th Policy Anniversary. There is no charge for this rider.
INVESTMENTS OF THE VUL ACCOUNT
- --------------------------------------------------------------------------------
PARTICIPATING INVESTMENT FUNDS
THE PHOENIX EDGE SERIES FUND
Certain Subaccounts of the VUL Account invest in corresponding Series of The
Phoenix Edge Series Fund. The Fund currently has the following Series available
through the Policies:
MONEY MARKET SERIES: The investment objective of the Money Market Series is
to provide maximum current income consistent
11
<PAGE>
with capital preservation and liquidity. The Money Market Series invests
exclusively in high quality money market instruments.
GROWTH SERIES: The investment objective of the Growth Series is to achieve
intermediate and long-term growth of capital, with income as a secondary
consideration. The Growth Series invests principally in common stocks of
corporations believed by management to offer growth potential.
MULTI-SECTOR FIXED INCOME ("MULTI-SECTOR") SERIES: The investment objective
of the Multi-Sector Series is to seek long-term total return. The Multi-Sector
Series seeks to achieve its investment objective by investing in a diversified
portfolio of high yield and high quality fixed income securities.
STRATEGIC ALLOCATION ("ALLOCATION") SERIES: The investment objective of the
Allocation Series is to realize as high a level of total return over an extended
period of time as is considered consistent with prudent investment risk. The
Allocation Series invests in stocks, bonds and money market instruments pursuant
to the Investment Adviser's appraisal of investments most likely to achieve the
highest total return.
INTERNATIONAL SERIES: The investment objective of the International Series
is to seek a high total return consistent with reasonable risk. The
International Series invests primarily in an internationally diversified
portfolio of equity securities. It intends to reduce its risk by engaging in
hedging transactions involving options, futures contracts and foreign currency
transactions. The International Series provides a means for investors to invest
a portion of their assets outside the United States.
BALANCED SERIES: The investment objective of the Balanced Series is to seek
reasonable income, long-term capital growth and conservation of capital. The
Balanced Series invests based on combined considerations of risk, income,
capital enhancement and protection of capital value.
REAL ESTATE SECURITIES ("REAL ESTATE") SERIES: The investment objective of
the Real Estate Series is to seek capital appreciation and income with about
equal emphasis. Under normal circumstances, it invests in marketable securities
of publicly traded real estate investment trusts (REITs) and companies that
operate, develop, manage and/or invest in real estate located primarily in the
United States.
STRATEGIC THEME ("THEME") SERIES: The investment objective of the Theme
Series is to seek long-term appreciation of capital by identifying securities
benefiting from long-term trends present in the United States and abroad. The
Theme Series invests primarily in common stocks believed to have substantial
potential for capital growth.
ABERDEEN NEW ASIA ("ASIA") SERIES: The investment objective of the Asia
Series is to seek long-term capital appreciation. The Asia Series invests
primarily in a diversified portfolio of equity securities of issuers organized
and principally operating in Asia, excluding Japan.
RESEARCH ENHANCED INDEX ("ENHANCED INDEX") SERIES: The investment objective
of the Enhanced Index Series is to seek high total return by investing in a
broadly diversified portfolio of equity securities of large and medium
capitalization companies within market sectors reflected in the S&P 500. The
Enhanced Index Series invests in a portfolio of undervalued common stocks and
other equity securities which appear to offer growth potential and an overall
volatility of return similar to that of the S&P 500.
ENGEMANN NIFTY FIFTY ("NIFTY FIFTY") SERIES: The investment objective of the
Nifty Fifty Series is to seek long-term capital appreciation by investing in
about 50 different securities which offer the best potential for long-term
growth of capital. At least 75% of the Series' assets will be invested in common
stocks of high quality growth companies. The remaining portion will be invested
in common stocks of small corporations with rapidly growing earnings per share
or common stocks believed to be undervalued.
SENECA MID-CAP GROWTH ("SENECA MID-CAP") SERIES: The investment objective of
the Seneca Mid-Cap Series is to seek capital appreciation primarily through
investments in equity securities of companies that have the potential for above
average market appreciation. The Series seeks to outperform the Standard &
Poor's Mid-Cap 400 Index.
PHOENIX GROWTH AND INCOME ("GROWTH & INCOME") SERIES: The investment
objective of the Growth & Income Series is to seek dividend growth, current
income and capital appreciation by investing in common stocks. The Growth &
Income Series seeks to achieve its objective by selecting securities primarily
from equity securities of the 1,000 largest companies traded in the United
States, ranked by market capitalization.
PHOENIX VALUE EQUITY ("VALUE") SERIES: The primary investment objective of
the Value Series is long-term capital appreciation, with a secondary investment
objective of current income. The Value Series seeks to achieve its objective by
investing in a diversified portfolio of common stocks that meet certain
quantitative standards that indicate above average financial soundness and
intrinsic value relative to price.
SCHAFER MID-CAP VALUE ("SCHAFER MID-CAP") SERIES: The primary investment
objective of the Schafer Mid-Cap Series is to seek long-term capital
appreciation, with current income as the secondary investment objective. The
Schafer Mid-Cap Series will invest in common stocks of established companies
having a strong financial position and a low stock market valuation when
purchased which are believed to offer the possibility of increase in value.
WANGER ADVISORS TRUST
Certain Subaccounts of the VUL Account invest in corresponding Series of the
Wanger Advisors Trust. The following Series are currently available through the
Policies:
WANGER U.S. SMALL CAP ("U.S. SMALL CAP") SERIES: The investment objective of
the U.S. Small Cap Series is to provide long-term growth. The U.S. Small Cap
Series invests primarily in securities of U.S. companies with total common stock
market capitalization of less than $1 billion.
WANGER INTERNATIONAL SMALL CAP ("INTERNATIONAL SMALL CAP") SERIES: The
investment objective of the International Small Cap
12
<PAGE>
Series is to provide long-term growth. The International Small Cap Series
invests primarily in securities of non-U.S. companies with total common stock
market capitalization of less than $1 billion.
WANGER TWENTY (TWENTY) SERIES: The investment objective of the Twenty Series
is to seek long-term capital growth. The Twenty Series invests primarily in the
stocks of U.S. companies with market capitalizations of $1 billion to $10
billion and ordinarily focuses its investments in 20 to 25 U.S. companies.
WANGER FOREIGN FORTY (FOREIGN) SERIES: The investment objective of the
Foreign Series is to seek long-term capital growth. The Foreign Series invests
primarily in the equity securities of foreign companies with market
capitalizations of $1 billion to $10 billion and focuses its investments in 40
to 60 companies in developed markets.
TEMPLETON VARIABLE PRODUCTS SERIES FUND
Certain Subaccounts of the VUL Account invest in corresponding Series of the
Templeton Variable Products Series Fund. The following Series are currently
available through the Policies:
TEMPLETON STOCK ("STOCK") SERIES: The investment objective of the Stock
Series is to provide capital growth. The Stock Series invests primarily in
common stocks issued by companies, large and small, in various nations
throughout the world.
TEMPLETON ASSET ALLOCATION ("TPT ALLOCATION") SERIES: The investment
objective of the TPT Allocation Series is to seek a high level of total return
through a flexible investment policy. The TPT Allocation Series invests in
stocks of companies of any nation, debt securities of companies and governments
of any nation and in money market instruments. Changes in the asset mix will be
made to try to capitalize on total return potential produced by changing
economic conditions throughout the world.
TEMPLETON INTERNATIONAL ("TPT INTERNATIONAL") SERIES: The investment
objective of the TPT International Series is to seek long-term capital growth
through a flexible policy of investing. The TPT International Series invests in
stocks and debt obligations of companies and governments outside the United
States. Any income realized will be incidental. Although the Series generally
invests in common stock, it also may invest in preferred stocks and certain debt
securities such as convertible bonds which are rated in any category by S&P or
Moody's or which are unrated by any rating agency.
TEMPLETON DEVELOPING MARKETS ("DEVELOPING MARKETS") SERIES: The investment
objective of the Developing Markets Series is to seek long-term capital
appreciation. The Developing Markets Series invests primarily in equity
securities of issuers in countries having developing markets.
MUTUAL SHARES INVESTMENTS ("SHARES") SERIES: The primary investment
objective of the Shares Series is to seek capital appreciation with income as a
secondary objective. The Shares Series invests in domestic equity securities and
domestic debt obligations.
EACH SERIES WILL BE SUBJECT TO MARKET FLUCTUATIONS AND RISKS INHERENT IN THE
OWNERSHIP OF ANY SECURITY AND THERE CAN BE NO ASSURANCE THAT THE STATED
INVESTMENT OBJECTIVE OF ANY SERIES WILL BE REALIZED.
In addition to being sold to the VUL Account, shares of the Funds also are
sold to the Phoenix Variable Accumulation Account, a separate account used by
Phoenix to receive and invest premiums paid under certain variable annuity
contracts issued by Phoenix. Shares of the Funds may also be sold to other
separate accounts of Phoenix or its affiliates or to the separate accounts of
other insurance companies.
It is conceivable that in the future it may be disadvantageous for variable
life insurance separate accounts and variable annuity separate accounts to
simultaneously invest in the Fund(s). Although neither Phoenix nor the Fund(s)
currently foresees any such disadvantages either to variable life insurance
Policyowners or to variable annuity Contract Owners, the Funds' trustees intend
to monitor events to identify any material conflicts between variable life
insurance Policyowners and variable annuity Contract Owners and to decide what
action, if any, should be taken in response to such conflicts. Material
conflicts could, for example, result from (1) changes in state insurance laws,
(2) changes in federal income tax laws, (3) changes in the investment management
of any portfolio of the Fund(s) or (4) differences in voting instructions
between those given by variable life insurance Policyowners and those given by
variable annuity Contract Owners. Phoenix will, at its own expense, remedy such
material conflicts including, if necessary, segregating the assets underlying
the variable life insurance policies and the variable annuity contracts and
establishing a new registered investment company.
INVESTMENT ADVISERS
Phoenix Investment Counsel, Inc. ("PIC") is the investment adviser to all
Series in The Phoenix Edge Series Fund except the Real Estate and Asia Series.
Based on subadvisory agreements with the Fund, PIC delegates certain investment
decisions and research functions to subadvisers for the following Series:
ENHANCED INDEX SERIES J.P. Morgan Investment Management, Inc.
NIFTY FIFTY SERIES Roger Engemann & Associates, Inc. ("Engemann")
SENECA MID-CAP SERIES Seneca Capital Management, LLC ("Seneca")
SCHAFER MID-CAP SERIES Schafer Capital Management, Inc.
The investment adviser to the REAL ESTATE SERIES is Duff & Phelps Investment
Management Co. ("DPIM").
The investment adviser to the Asia Series is Phoenix-Aberdeen International
Advisors LLC ("PAIA"). Pursuant to subadvisory agreements with the Fund, PAIA
delegates certain investment decisions and research functions with respect to
the Asia Series to PIC and Aberdeen Fund Managers, Inc.
13
<PAGE>
PIC, DPIM, Engemann and Seneca are indirect; less than wholly owned
subsidiaries of Phoenix. PAIA is jointly owned and managed by PM Holdings, Inc.,
a subsidiary of Phoenix, and Aberdeen Fund Managers, Inc.
The other investment advisers are:
WANGER ADVISORS TRUST Wanger Asset Management, L.P.
TPT ASSET ALLOCATION Templeton Investment
TPT INTERNATIONAL Counsel, Inc.
TPT STOCK
TEMPLETON DEVELOPING Templeton Asset Management,
MARKETS Ltd.
MUTUAL SHARES Franklin Mutual Advisers, Inc.
INVESTMENTS
SERVICES OF THE ADVISERS
The Advisers continuously furnish an investment program for each Series and
manage the investment and reinvestment of the assets of each Series subject at
all times to the authority and supervision of the Trustees. A detailed
discussion of the investment advisers and subadvisers, and the investment
advisory and subadvisory agreements, is contained in the accompanying prospectus
for the Funds.
REINVESTMENT AND REDEMPTION
All dividend distributions of the Fund are automatically reinvested in
shares of the Fund at their net asset value on the date of distribution; all
capital gains distributions of the Fund, if any, are likewise reinvested at the
net asset value on the record date. Phoenix redeems Fund shares at their net
asset value to the extent necessary to make payments under the Policy.
SUBSTITUTION OF INVESTMENTS
Phoenix reserves the right, subject to compliance with the law to add
additional series, delete existing series, or substitute one series for another.
Phoenix in its sole discretion, will determine if and when to establish new
Subaccounts. Similarly, Phoenix in its sole discretion will determine whether to
make any new Subaccounts available to existing Policies.
If the shares of any of the portfolios of the Fund should no longer be
available for investment, or if in the judgment of Phoenix's management further
investment in shares of any of the portfolios becomes inappropriate in view of
the objectives of the Policy, then Phoenix may substitute shares of another fund
for shares already purchased, or to be purchased in the future. No substitution
of fund shares held by the VUL Account may take place without prior approval of
the SEC and prior notice to you. In the event of a substitution, you will be
given the option of transferring the Policy Value of the Subaccount in which the
substitution is to occur to another Subaccount without penalty.
CHARGES AND DEDUCTIONS
- --------------------------------------------------------------------------------
Charges are deducted in connection with the Policy to compensate us for: (1)
incurring expenses in distributing the Policy; (2) issuing the Policy; (3)
premium and federal taxes incurred on premiums received; (4) providing the
insurance benefits set forth in the Policy; and (5) assuming certain risks in
connection with the Policy. The nature and amount of these charges are described
more fully below.
We may reduce or eliminate the following charges for Policies issued under
group or sponsored arrangements: sales charge, issue expense charge,
administrative charge and surrender charge. Generally, costs per Policy vary
with the size of the group or sponsored arrangement, its stability as indicated
by its term of existence and certain characteristics of its members, the
purposes for which the Policies are purchased and other factors. The amount of
reduction will be considered on a case-by-case basis and will reflect the
reduced costs to us expected as a result of sales to a particular group or
sponsored arrangement.
PREMIUM SALES CHARGE
A charge is made to compensate us for the cost of selling the Policy. This
cost includes registered representative's commissions, commission overrides,
advertising, the printing of the Policy Prospectus and sales literature. The
amount of the charge in any Policy Year cannot be specifically tied to sales
expenses for that year. We expect to recover our total sales expenses over the
period the Policy is In Force. To the extent that sales charges are insufficient
to cover actual sales expenses, these expenses may be recovered from other
sources, including gains from the charge for mortality and expense risks and
other gains with respect to the Policies, or from our general assets.
The sales charge is assessed according to the following schedule:
[diamond] Policy Year One: 20% of premiums paid up to the
first TAP
5% of premiums in excess of the TAP
[diamond] Policy Years Two-Ten: 5% of premium
[diamond] Policy Years Eleven and over: 0% of premium
The TAP is established at issue and is the greater of: (a) the level premium
required to mature the Policy, computed at an interest rate of 6.5% assuming
current mortality and expenses; and (b) $1,200.
MONTHLY DEDUCTION
A charge is deducted monthly from the Policy Value ("monthly deduction") to
pay:
[diamond] issue expense charge
[diamond] administrative charge
[diamond] cost of insurance
[diamond] cost of any rider benefits
The monthly deduction is deducted on each Monthly Calculation Day. It is
allocated among Subaccounts and the unloaned portion of the GIA based on the
allocation schedule for monthly deductions specified by you in your application
for a Policy or as you may later
14
<PAGE>
have changed it. If the value of a Subaccount or the unloaned portion of the GIA
is insufficient to permit the withdrawal of the full monthly deduction, the
remainder will be taken on a proportionate basis from the other Subaccounts and
the unloaned portion of the GIA. The number of units deducted from any
Subaccount (or unloaned portion of the GIA) will be determined by dividing the
dollar amount of the monthly deduction by the value of a unit in that Subaccount
on the Monthly Calculation Day. Because portions of the monthly deduction, such
as the cost of insurance, can vary from month to month, the monthly deduction
itself may vary in dollar amount from month to month.
[diamond] ISSUE EXPENSE CHARGE. The issue expense charge is $600 and is to
compensate Phoenix for underwriting and start-up expenses in
connection with issuing a Policy. Rather than deduct the full amount
at once, the issue charge is deducted in equal monthly installments
of $50 over a 12-month period.
[diamond] ADMINISTRATIVE CHARGE. A charge also is assessed to cover our
variable administrative costs such as the preparation of billings,
statements and mailings to Policyholders. The administrative charge
is only assessed in Policy Years one through ten and varies by the
Face Amount of the Policy as follows:
o $20 per month for Policies with Face Amounts of less than or equal
to $400,000;
o $0.05 per $1,000 for Policies with Face Amounts of $400,001 up to
$1,600,000; and
o $80 per month for Policies with Face Amounts of greater than
$1,600,000
[diamond] COST OF INSURANCE. To compute the cost of insurance charge, we
multiply the applicable cost of insurance rate by the difference
between the death benefit selected and the Policy Value. Generally,
cost of insurance rates are based on the sex, Attained Age and risk
class of the Insureds. However, in certain states and for policies
issued in conjunction with certain qualified plans, cost of insurance
rates are not based on sex. The actual monthly costs of insurance
rates are based on our expectations of future mortality experience.
They will not, however, be greater than the guaranteed cost of
insurance rates set forth in the Policy. These guaranteed maximum
rates are equal to 100% of the 1980 Commissioners Standard Ordinary
("CSO") Mortality Table, with appropriate adjustment for the
Insureds' risk classification. Any change in the cost of insurance
rates will apply to all persons of the same sex, insurance age and
risk class whose Policies have been In Force for the same length of
time. Your risk class may affect your cost of insurance rate. We
currently place Insureds into a standard risk class or a risk class
involving a higher mortality risk, depending upon the health of the
Insureds as determined by medical information that we request. For
otherwise identical Policies, Insureds in the standard risk class
will have a lower cost of insurance than those in the risk class with
the higher mortality risk. The standard risk class also is divided
into categories: smokers, nonsmokers and those who have never smoked.
Nonsmokers will generally incur a lower cost of insurance than
similarly situated Insureds who smoke.
PREMIUM TAXES
Various states and subdivisions impose a tax on premiums received by
insurance companies. Premium taxes vary from state to state. Currently, the
taxes imposed by states on premiums range from 0.75% to 4% of premiums paid.
Moreover, certain municipalities in Louisiana, Kentucky and South Carolina also
impose taxes on premiums paid, in addition to the state taxes imposed. The
premium tax charge represents an amount we consider necessary to pay all premium
taxes imposed by such states and any subdivision thereof, and we do not expect
to derive a profit from this charge. Policies will be assessed a tax charge
equal to 2.25% of the premiums paid. These charges are deducted from the Issue
Premium, and from each subsequent premium payment.
FEDERAL TAX CHARGE
A charge equal to 1.50% of each premium will be deducted from each premium
payment to cover the estimated cost to us of the federal income tax treatment of
deferred acquisition costs.
MORTALITY AND EXPENSE RISK CHARGE
We will deduct a daily charge from the VUL Account at an annual rate of
0.80% of the average daily net assets of the VUL Account to compensate for
certain risks assumed in connection with the Policy. After the 15th Policy Year,
a reduced annual rate of .25% will apply. This charge is not deducted from the
GIA.
The mortality risk assumed by us is that collectively Insureds may live for
a shorter time than projected because of inaccuracies in that projecting process
and, accordingly, that an aggregate amount of death benefits greater than that
projected will be payable. The expense risk assumed is that expenses incurred in
issuing and maintaining the Policies may exceed the limits on administrative
charges set in the Policies. If the expenses do not increase to an amount in
excess of the limits, or if the mortality projecting process proves to be
accurate, we may profit from this charge. We also assume risks with respect to
other contingencies including the incidence of Policy loans, which may cause us
to incur greater costs than expected when designing the Policies. To the extent
we profit from this charge, we may use those profits for any proper purpose,
including the payment of sales expenses or any other expenses that may exceed
income in a given year.
INVESTMENT MANAGEMENT CHARGE
As compensation for investment management services to the Funds, the
Advisers are entitled to fees, payable monthly and based on an annual percentage
of the average aggregate daily net asset values of each Series.
These Fund charges and other expenses are reflected in the Funds' net asset
values and are described more fully in the accompanying Fund prospectuses.
15
<PAGE>
OTHER CHARGES
SURRENDER CHARGE
During the first 10 Policy Years, there is a difference between the amount
of Policy Value and the amount of Cash Surrender Value of the Policy. This
difference is the surrender charge, which is a contingent deferred sales charge.
The surrender charge is designed to recover expenses for the distribution of
Policies that are terminated by surrender before distribution expenses have been
recouped. These are contingent charges because they are paid only if the Policy
is surrendered (or the Face Amount is reduced or the Policy lapses) during this
period. They are deferred charges because they are not deducted from premiums.
During the first 10 Policy Years, the full surrender charge as described
below will apply if you either surrender the Policy for its Cash Surrender Value
or let the Policy lapse. The applicable surrender charge in any Policy Month is
the full surrender charge minus any surrender charges that have been previously
paid as a result of a partial surrender or a decrease in Face Amount. There is
no surrender charge after the 10th Policy Year. During the first 10 Policy
Years, the maximum surrender charge that you can pay while you own the Policy is
equal to the percentage amount shown in the Surrender Charge Table below.
Surrender Charge Table
----------------------
SURRENDER SURRENDER SURRENDER
POLICY CHARGE POLICY CHARGE POLICY CHARGE
MONTH % OF TAP MONTH % OF TAP MONTH % OF TAP
- ----- -------- -------- - --------
1-70 100% 87 66% 104 32%
71 98% 88 64% 105 30%
72 96% 89 62% 106 28%
73 94% 90 60% 107 26%
74 92% 91 58% 108 24%
75 90% 92 56% 109 22%
76 88% 93 54% 110 20%
77 86% 94 52% 111 18%
78 84% 95 50% 112 16%
79 82% 96 48% 113 14%
80 80% 97 46% 114 12%
81 78% 98 44% 115 10%
82 76% 99 42% 116 8%
83 74% 100 40% 117 6%
84 72% 101 38% 118 4%
85 70% 102 36% 119 2%
86 68% 103 34% 120 0%
PARTIAL SURRENDER FEE
A fee equal to the lesser of $25 or 2% of the amount withdrawn from the
Policy is deducted from the Policy Value upon a partial surrender of the Policy
to recover the actual costs of processing the partial surrender request. The
assessment to each Subaccount or to the GIA will be made in the same manner as
provided for the partial surrender amount paid. That is, the value of each
Subaccount or the GIA will be reduced based on the allocation made at the time
of the partial surrender. If no allocation request is made, the assessment to
each Subaccount and to the GIA will be made in the same manner as provided for
monthly deductions.
PARTIAL SURRENDER CHARGE
A charge as described below is deducted from the Policy Value upon a partial
surrender of the Policy. The charge is equal to a pro rata portion of the
applicable surrender charge that would apply to a full surrender, determined by
multiplying the applicable surrender charge by a fraction (equal to the partial
surrender amount payable divided by the result of subtracting the applicable
surrender charge from the Policy Value). This amount is assessed against the
Subaccounts or the GIA in the same manner as provided for with respect to the
partial surrender amount paid.
A partial surrender charge also is deducted from Policy Value upon a
decrease in Face Amount. The charge is equal to the applicable surrender charge
multiplied by a fraction (equal to the decrease in Face Amount divided by the
Face Amount of the Policy prior to the decrease).
TAXES
Currently no charge is made to the VUL Account for federal income taxes that
may be attributable to the VUL Account. We may, however, make such a charge in
the future. Charges for other taxes, if any, attributable to the VUL Account
also may be made.
GENERAL PROVISIONS
- --------------------------------------------------------------------------------
POSTPONEMENT OF PAYMENTS
GENERAL
Payment of any amount upon complete or partial surrender, Policy loan or
benefits payable at death (in excess of the initial Face Amount) or maturity may
be postponed: (1) for up to six months from the date of the request, for any
transactions dependent upon the value of the GIA; (2) whenever the NYSE is
closed other than for customary weekend and holiday closings or trading on the
NYSE is restricted as decided by the SEC; or (3) whenever an emergency exists,
as decided 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 VUL Account's net assets. Transfers also may be postponed under
these circumstances.
PAYMENT BY CHECK
Payments under the Policy of any amounts derived from premiums paid by check
may be delayed until such time as the check has cleared your bank.
THE CONTRACT
The Policy and attached copy of the application are the entire contract.
Only statements in the application can be used to void the Policy. The
statements are considered representations and not warranties. Only an executive
officer of Phoenix can agree to change or waive any provisions of the Policy.
SUICIDE
If either of the Insureds commits suicide within two years after the
Policy's Date of Issue, the Policy will stop and become void. We will pay you
the Policy Value adjusted by the addition of any monthly deductions and other
fees and charges, minus any Debt owed to us under the Policy.
INCONTESTABILITY
We cannot contest this Policy or any attached rider after it has been In
Force during the Insureds' lifetimes for two years from the Policy Date.
16
<PAGE>
CHANGE OF OWNER OR BENEFICIARY
The Beneficiary, as named in the Policy application or subsequently changed,
will receive the Policy benefits at the death of the last surviving Insured. If
the named Beneficiary dies before the death of the last surviving Insured, the
contingent Beneficiary, if named, becomes the Beneficiary. If no Beneficiary
survives the last surviving Insured, the death benefit payable under the Policy
will be paid to you or your estate.
As long as the Policy is In Force, the Policyowner and the Beneficiary may
be changed by written request, satisfactory to us. A change in Beneficiary will
take effect as of the date the notice is signed, whether or not the last
surviving Insured is living when we receive the notice. We will not, however, be
liable for any payment made or action taken before receipt of the notice.
ASSIGNMENT
The Policy may be assigned. We will not be bound by the assignment until a
written copy has been received and we will not be liable with respect to any
payment made prior to receipt. We assume no responsibility for determining
whether an assignment is valid.
MISSTATEMENT OF AGE OR SEX
If the age or sex of either of the Insureds has been misstated, the death
benefit will be adjusted based on what the cost of insurance charge for the most
recent monthly deduction would have purchased based on the correct age and sex
of the Insureds.
SURPLUS
You may share in divisible surplus of Phoenix to the extent decided annually
by the Phoenix Board of Directors. However, it is not currently expected that
the Board will authorize these payments since you will be participating directly
in the Subaccount's investment results.
PAYMENT OF PROCEEDS
- --------------------------------------------------------------------------------
SURRENDER AND DEATH BENEFIT PROCEEDS
Death benefit proceeds and the proceeds of full or partial surrenders will
be processed at unit values next computed after we receive the request for
surrender or due proof of death, provided such request is complete and in good
order. Payment of surrender or death proceeds usually will be made in one lump
sum within seven days, unless another payment option has been elected. Payment
of the death proceeds, however, may be delayed if the claim for payment of the
death proceeds needs to be investigated; e.g., to ensure payment of the proper
amount to the proper payee. Any such delay will not be beyond that reasonably
necessary to investigate such claims consistent with insurance practices
customary in the life insurance industry. Under this Policy, the death proceeds
will be paid upon the death of the last surviving Insured.
You may elect a payment option for payment of the death proceeds to the
Beneficiary. You may do this only before the second death. You may revoke or
change a prior election, unless such right has been waived. The Beneficiary may
make or change an election before payment of the death proceeds, unless you have
made an election that does not permit such further election or changes by the
Beneficiary.
A written request in a form satisfactory to us is required to elect, change
or revoke a payment option.
The minimum amount of surrender or death proceeds that may be applied under
any payment option is $1,000.
If the Policy is assigned as collateral security, we will pay any amount due
the assignee in one lump sum. Any remaining proceeds will remain under the
option elected.
PAYMENT OPTIONS
All or part of the surrender or death proceeds of a Policy may be applied
under one or more of the following payment options or such other payment options
or alternative versions of the options listed as we may choose to make available
in the future.
OPTION 1--LUMP SUM.
Payment in one lump sum.
OPTION 2--LEFT TO EARN INTEREST.
A payment of interest during the payee's lifetime on the amount payable as a
principal sum. Interest rates are guaranteed to be at least 3% per year.
OPTION 3--PAYMENT FOR A SPECIFIC PERIOD.
Equal installments are paid for a specified period of years whether the
payee lives or dies. The first payment will be on the date of settlement. The
assumed interest rate on the unpaid balance is guaranteed not to be less than 3%
per year.
OPTION 4--LIFE ANNUITY WITH SPECIFIED PERIOD CERTAIN.
Equal installments are paid until the later of: (A) The death of the payee
and (B) The end of the period certain. The first payment will be on the date of
settlement. The period certain must be chosen when this option is elected. The
periods certain that may be chosen are as follows: (A) Ten years; (B) Twenty
years; (C) Until the installments paid refund the amount applied under this
option; and if the payee is not living when the final payment falls due, that
payment will be limited to the amount which needs to be added to the payments
already made to equal the amount applied under this option. If, for the age of
the payee, a period certain is chosen that is shorter than another period
certain paying the same installment amount, we will consider the longer period
certain as having been elected. Any life annuity provided under Option 4 is
computed using an interest rate guaranteed to be no less than 3 3/8% per year,
but any life annuity providing a period certain of 20 years or more is computed
using an interest rate guaranteed to be no less than 3 1/4% per year.
OPTION 5--LIFE ANNUITY.
Equal installments are paid only during the lifetime of the payee. The first
payment will be on the date of settlement. Any life annuity as may be provided
under Option 5 is computed using an interest rate guaranteed to be no less than
3 1/2% per year.
17
<PAGE>
OPTION 6--PAYMENTS OF A SPECIFIED AMOUNT.
Equal installments of a specified amount, out of the principal sum and
interest on that sum, are paid until the principal sum remaining is less than
the amount of the installment. When that happens, the principal sum remaining
with accrued interest will be paid as a final payment. The first payment will be
on the date of settlement. The payments will include interest on the remaining
principal at a guaranteed rate of at least 3% per year. This interest will be
credited at the end of each year. If the amount of interest credited at the end
of the year exceeds the income payments made in the last 12 months, that excess
will be paid in one sum on the date credited.
OPTION 7--JOINT SURVIVORSHIP ANNUITY WITH 10-YEAR PERIOD CERTAIN.
The first payment will be on the date of settlement. Equal installments are
paid until the latest of: (A) The end of the 10-year period certain; (B) The
death of the Insured; and (C) The death of the other named annuitant. The other
annuitant must be named when this option is elected and cannot later be changed.
The other annuitant must have an attained age of at least 40. Any joint
survivorship annuity that may be provided under this option is computed using a
guaranteed interest rate to equal at least 3 3/8% per year.
For additional information concerning the above payment options, see the
Policy.
FEDERAL TAX CONSIDERATIONS
- --------------------------------------------------------------------------------
INTRODUCTION
The ultimate effect of federal income taxes on values under the VUL Account
and on the economic benefit to you or your Beneficiary depends on Phoenix's tax
status and upon the tax status of the individual concerned. The discussion
contained herein is general in nature and is not intended as tax advice. For
complete information on federal and state tax considerations, a qualified tax
adviser should be consulted. No attempt is made to consider any estate and
inheritance taxes, or any state, local or other tax laws. Because the discussion
herein is based upon our understanding of federal income tax laws as they are
currently interpreted, we cannot guarantee the tax status of any Policy. The
Internal Revenue Service (the "IRS") makes no representation regarding the
likelihood of continuation of current federal income tax laws, Treasury
regulations or of the current interpretations. We reserve the right to make
changes to the Policy to assure that it will continue to qualify as a life
insurance contract for federal income tax purposes.
PHOENIX'S TAX STATUS
Phoenix is taxed as a life insurance company under the Internal Revenue Code
of 1986, as amended (the "Code"). For federal income tax purposes, neither the
VUL Account nor the GIA is a separate entity from Phoenix and their operations
form a part of Phoenix.
Investment income and realized capital gains on the assets of the VUL
Account are reinvested and taken into account in determining the value of the
VUL Account. Investment income of the VUL Account, including realized net
capital gains, is not taxed to Phoenix. Due to Phoenix's tax status under
current provisions of the Code, no charge currently will be made to the VUL
Account for Phoenix's federal income taxes, which may be attributable to the VUL
Account. Phoenix reserves the right to make a deduction for taxes if the federal
tax treatment of Phoenix is determined to be other than what Phoenix currently
believes it to be, if changes are made affecting the tax treatment to Phoenix of
variable life insurance contracts, or if changes occur in Phoenix's tax status.
If imposed, such charge would be equal to the federal income taxes attributable
to the investment results of the VUL Account.
POLICY BENEFITS
DEATH BENEFIT PROCEEDS
The Policy, whether or not it is a modified endowment contract (see the
discussion on modified endowment contracts below), should be treated as meeting
the definition of a life insurance contract for federal income tax purposes,
under Section 7702 of the Code. As such, the death benefit proceeds thereunder
should be excludable from the gross income of the Beneficiary under Code Section
101(a)(1). Also, a Policyowner should not be considered to be in constructive
receipt of the cash value, including investment income. See, however, the
sections below on possible taxation of amounts received under the Policy, via
full surrender, partial surrender or loan.
Code Section 7702 imposes certain conditions with respect to premiums
received under a Policy. Phoenix intends to monitor the premiums to assure
compliance with such conditions. However, if the premium limitation is exceeded
during the year, Phoenix may return the excess premium, with interest, to the
Policyowner within 60 days after the end of the Policy Year, and maintain the
qualification of the Policy as life insurance for federal income tax purposes.
FULL SURRENDER
Upon full surrender of a Policy for its cash value, the excess, if any, of
the cash value (unreduced by any outstanding indebtedness) over the premiums
paid will be treated as ordinary income for federal income tax purposes. The
full surrender of a Policy that is a modified endowment contract may result in
the imposition of an additional 10% tax on any income received.
PARTIAL SURRENDER
If the Policy is a modified endowment contract, partial surrenders are fully
taxable to the extent of income in the Policy and are possibly subject to an
additional 10% tax. See the discussion on modified endowment contracts below. If
the Policy is not a modified endowment contract, partial surrenders still may be
taxable, as follows. Code Section 7702(f)(7) provides that where a reduction in
death benefits occurs during the first 15 years after a Policy is issued and
there is a cash distribution associated with that reduction, a Policyowner may
be taxed on all or a part of the amount distributed. A reduction in death
benefits may result from a partial surrender. After 15 years, the proceeds will
not be subject to tax, except to the extent such proceeds exceed the total
amount of premiums paid but not previously recovered. Phoenix suggests you
consult with your tax adviser in advance of a proposed decrease in death
benefits or a partial
18
<PAGE>
surrender as to the portion, if any, which would be subject to tax, and in
addition as to the impact such partial surrender might have under the new rules
affecting modified endowment contracts.
LOANS
Phoenix believes that any loan received under a Policy will be treated as
indebtedness of a Policyowner. If the Policy is a modified endowment contract,
loans are fully taxable to the extent of income in the Policy and are possibly
subject to an additional 10% tax. See the discussion on modified endowment
contracts below. If the Policy is not a modified endowment contract, Phoenix
believes that no part of any loan under a Policy will constitute income to a
Policyowner.
The deductibility by a Policyowner of loan interest under a Policy may be
limited under Code Section 264, depending on circumstances. A Policyowner
intending to fund premium payments through borrowing should consult a tax
adviser with respect to the tax consequences thereof. Under the "personal"
interest limitation provisions of the Code, interest on Policy loans used for
personal purposes is not tax deductible. Other rules may apply to allow all or
part of the interest expense as a deduction if the loan proceeds are used for
"trade or business" or "investment" purposes. See your tax adviser for further
guidance.
BUSINESS-OWNED POLICIES
If a business or a corporation owns the Policy, the Code may impose
additional restrictions. The Code limits the interest deduction on
business-owned Policy loans and may impose tax upon the inside build-up of
corporate-owned life insurance policies through the corporate alternative
minimum tax.
MODIFIED ENDOWMENT CONTRACTS
GENERAL
Pursuant to Code Section 72(e), loans and other amounts received under
modified endowment contracts will, in general, be taxed to the extent of
accumulated income (generally, the excess of cash value over premiums paid).
Policies are modified endowment contracts if they meet the definition of life
insurance, but fail the 7-pay test. This test essentially provides that the
cumulative premiums paid under the Policy at any time during the Policy's first
seven years cannot exceed the sum of the net level premiums that would have been
paid on or before that time had the Policy provided for paid-up future benefits
after the payment of seven level annual premiums. In addition, a modified
endowment contract includes any life insurance contract that is received in
exchange for a modified endowment contract. Premiums paid during a Policy Year
that are returned by Phoenix (with interest) within 60 days after the end of the
Policy Year will not cause the Policy to fail the 7-pay test.
REDUCTION IN BENEFITS DURING THE FIRST SEVEN YEARS
If there is a reduction in benefits during the first seven Policy Years, the
premiums are redetermined for purposes of the 7-pay test as if the Policy
originally had been issued at the reduced death benefit level and the new
limitation is applied to the cumulative amount paid for each of the first seven
Policy Years.
DISTRIBUTIONS AFFECTED
If a Policy fails to meet the 7-pay test, it is considered a modified
endowment contract only as to distributions in the year in which the death
benefit reduction takes effect and all subsequent Policy Years. However,
distributions made in anticipation of such failure (there is a presumption that
distributions made within two years prior to such failure were "made in
anticipation") also are considered distributions under a modified endowment
contract. If the Policy satisfies the 7-pay test for seven years, distributions
and loans generally will not be subject to the modified endowment contract
rules.
PENALTY TAX
Any amount taxable under the modified endowment contract rule will be
subject to an additional 10% excise tax, with certain exceptions. This
additional tax will not apply in the case of distributions: (1) made on or after
the taxpayer attains age 59 1/2; or (2) which are attributable to the taxpayer's
disability (within the meaning of Code Section 72(m)(7)); or (3) which are part
of a series of substantially equal periodic payments (not less often than
annually) made for the life (or life expectancy) of the taxpayer or the joint
lives (or life expectancies) of the taxpayer and his Beneficiary.
MATERIAL CHANGE RULES
Any determination of whether the Policy meets the 7-pay test will begin
again any time the Policy undergoes a "material change," which includes any
increase in death benefits or any increase in or addition of a qualified
additional benefit, with the following two exceptions. First, if an increase is
attributable to premiums paid "necessary to fund" the lowest death benefit and
qualified additional benefits payable in the first seven Policy Years or to the
crediting of interest or dividends with respect to these premiums, the
"increase" does not constitute a material change. Second, to the extent provided
in regulations, if the death benefit or qualified additional benefit increases
as a result of a cost-of-living adjustment based on an established broad-based
index specified in the Policy, this does not constitute a material change if (1)
the cost-of-living determination period does not exceed the remaining premium
payment period under the Policy, and (2) the cost-of-living increase is funded
ratably over the remaining premium payment period of the Policy. A reduction in
death benefits is not considered a material change unless accompanied by a
reduction in premium payments.
A material change may occur at any time during the life of the Policy
(within the first seven years or thereafter), and future taxation of
distributions or loans would depend upon whether the Policy satisfied the
applicable 7-pay test from the time of the material change. An exchange of
policies is considered to be a material change for all purposes.
SERIAL PURCHASE OF MODIFIED ENDOWMENT CONTRACTS
All modified endowment contracts issued by the same insurer (or affiliated
companies of the insurer) to the same Policyowner within the same calendar year
will be treated as one modified endowment contract in determining the taxable
portion of any loans or distributions made to the Policyowner. The Treasury has
been given specific legislative authority to issue regulations to prevent the
avoidance of the
19
<PAGE>
new distribution rules for modified endowment contracts. A qualified tax adviser
should be consulted about the tax consequences of the purchase of more than one
modified endowment contract within any calendar year.
LIMITATIONS ON UNREASONABLE MORTALITY AND EXPENSE CHARGES
The Code imposes limitations on unreasonable mortality and expense charges
for purposes of ensuring that a Policy qualifies as a life insurance contract
for federal income tax purposes. The mortality charges taken into account to
compute permissible premium levels may not exceed those charges required to be
used in determining the federal income tax reserve for the Policy, unless
Treasury regulations prescribe a higher level of charge. In addition, the
expense charges taken into account under the guideline premium test are required
to be reasonable, as defined by the Treasury regulations. Phoenix intends to
comply with the limitations in calculating the premium it is permitted to
receive from you.
QUALIFIED PLANS
A Policy may be used in conjunction with certain qualified plans. Since the
rules governing such use are complex, you should not use the Policy in
conjunction with a qualified plan until you have consulted a competent pension
consultant or tax adviser.
DIVERSIFICATION STANDARDS
To comply with the Diversification Regulations under Code Section 817(h),
("Diversification Regulations") each Series of the Funds is required to
diversify its investments. The Diversification Regulations generally require
that on the last day of each calendar quarter that the Series assets be invested
in no more than:
[diamond] 55% in any 1 investment
[diamond] 70% in any 2 investments
[diamond] 80% in any 3 investments
[diamond] 90% in any 4 investments
A "look-through" rule applies to treat a pro rata portion of each asset of a
Series as an asset of the VUL Account; therefore, each Series of the Fund will
be tested for compliance with the percentage limitations. For purposes of these
diversification rules, all securities of the same issuer are treated as a single
investment, but each United States government agency or instrumentality is
treated as a separate issuer.
The general diversification requirements are modified if any of the assets
of the VUL Account are direct obligations of the United States Treasury. In this
case, there is no limit on the investment that may be made in Treasury
securities, and for purposes of determining whether assets other than Treasury
securities are adequately diversified, the generally applicable percentage
limitations are increased based on the value of the VUL Account's investment in
Treasury securities. Notwithstanding this modification of the general
diversification requirements, the portfolios of the Funds will be structured to
comply with the general diversification standards because they serve as an
investment vehicle for certain variable annuity contracts that must comply with
these standards.
In connection with the issuance of the Diversification Regulations, the
Treasury announced that such regulations do not provide guidance concerning the
extent to which you may direct your investments to particular divisions of a
separate account. It is possible that a revenue ruling or other form of
administrative pronouncement in this regard may be issued in the near future. It
is not clear, at this time, what such a revenue ruling or other pronouncement
will provide. It is possible that the Policy may need to be modified to comply
with such future Treasury announcements. For these reasons, Phoenix reserves the
right to modify the Policy, as necessary, to prevent you from being considered
the owner of the assets of the VUL Account.
Phoenix intends to comply with the Diversification Regulations to assure
that the Policies continue to qualify as a life insurance contract for federal
income tax purposes.
CHANGE OF OWNERSHIP OR INSURED OR ASSIGNMENT
Changing the Policyowner, or one or both of the Insureds or an exchange or
assignment of the Policy may have tax consequences depending on the
circumstances. Code Section 1035 provides that a life insurance contract can be
exchanged for another life insurance contract, without recognition of gain or
loss, assuming that no money or other property is received in the exchange, and
that the Policies relate to the same Insureds. If the surrendered Policy is
subject to a policy loan, this may be treated as the receipt of money on the
exchange. Phoenix recommends that any person contemplating such actions seek the
advice of a qualified tax consultant.
OTHER TAXES
Federal estate tax, state and local estate, inheritance and other tax
consequences of ownership or receipt of Policy proceeds depend on the
circumstances of each Policyowner or Beneficiary. We do not make any
representations or guarantees regarding the tax consequences of any Policy with
respect to these types of taxes.
VOTING RIGHTS
- --------------------------------------------------------------------------------
THE FUNDS
We will vote the Funds' shares held by the Subaccounts at any regular and
special meetings of shareholders of the Funds. To the extent required by law,
such voting will be pursuant to instructions received from you. However, if the
1940 Act or any regulation thereunder should be amended or if the present
interpretation thereof should change, and as a result we decide that we are
permitted to vote the Funds' shares at our own discretion, we may elect to do
so.
The number of votes that you have the right to cast will be determined by
applying your percentage interest in a Subaccount to the total number of votes
attributable to the Subaccount. In determining the number of votes, fractional
shares will be recognized.
Funds' shares held in a Subaccount for which no timely instructions are
received, and Funds' shares which are not otherwise
20
<PAGE>
attributable to Policyowners, will be voted by Phoenix in proportion to the
voting instructions that are received with respect to all Policies participating
in that Subaccount. Instructions to abstain on any item to be voted upon will be
applied to reduce the votes eligible to be cast by Phoenix.
You will receive proxy materials, reports and other materials related to the
Funds.
We may, when required by state insurance regulatory authorities, disregard
voting instructions if the instructions require that the shares be voted so as
to cause a change in the subclassification or investment objective of one or
more of the portfolios of the Funds or to approve or disapprove an investment
advisory contract for the Funds. In addition, Phoenix itself may disregard
voting instructions in favor of changes initiated by a Policyowner in the
investment policies or the Investment Adviser of the Funds if Phoenix reasonably
disapproves of such changes. A change would be disapproved only if the proposed
change is contrary to state law or prohibited by state regulatory authorities or
we decide that the change would have an adverse effect on the General Account
because the proposed investment policy for a Series may result in overly
speculative or unsound investments. In the event Phoenix does disregard voting
instructions, a summary of that action and the reasons for such action will be
included in the next periodic report to Policyowners.
PHOENIX
You (or the payee entitled to payment under a payment option if a different
person) will have the right to vote at annual meetings of all Phoenix
policyholders for the election of members of the Board of Directors of Phoenix
and on other corporate matters, if any, where a policyholder's vote is taken. At
meetings of all the Phoenix policyholders, you (or payee) may cast only one vote
as the holder of a Policy, irrespective of Policy Value or the number of the
Policies you hold.
THE DIRECTORS AND EXECUTIVE OFFICERS OF PHOENIX
- -------------------------------------------------------------------------------
Phoenix is managed by its Board of Directors, the members of which are
elected by its Policyholders, including Owners of the Policies. See "Voting
Rights."
The following are the Directors and Executive Officers of Phoenix:
DIRECTORS PRINCIPAL OCCUPATION
Sal H. Alfiero Chairman and Chief Executive
Officer, Mark IV Industries, Inc.
Amherst, New York
J. Carter Bacot Chairman and Chief Executive
Officer, The Bank of New York
New York, New York
Carol H. Baldi President, Carol H. Baldi, Inc.
New York, New York
Richard H. Booth Executive Vice President,
Strategic Development, Phoenix
Home Life Mutual Insurance
Company, Hartford, Connecticut;
formerly President, Travelers
Insurance Company
Peter C. Browning President and Chief Operating
Officer, Sonoco Products Company
Hartsville, South Carolina
Arthur P. Byrne Chairman, President and Chief
Executive Officer,
The Wiremold Company
West Hartford, Connecticut
Richard N. Cooper Professor of International
Economics, Harvard University;
formerly Chairman, National
Intelligence Council, Central
Intelligence Agency
McLean, Virginia
Gordon J. Davis, Esq. Partner, LeBoeuf, Lamb, Greene &
MacRae; formerly Partner, Lord,
Day & Lord, Barret Smith
New York, New York
Robert W. Fiondella Chairman of the Board, President
and Chief Executive Officer,
Phoenix Home Life Mutual Insurance
Company
Hartford, Connecticut
Jerry J. Jasinowski President, National Association of
Manufacturers
Washington, D.C.
John W. Johnstone Chairman, President and Chief
Executive Officer, Olin
Corporation
Norwalk, Connecticut
Marilyn E. LaMarche Limited Managing Director,
Lazard Freres & Company
New York, New York
Philip R. McLoughlin Executive Vice President and Chief
Investment Officer, Phoenix Home
Life Mutual Insurance Company
Hartford, Connecticut
Indra K. Nooyi Senior Vice President,
PepsiCo, Inc.
Purchase, New York
Robert F. Vizza President and Chief Executive
Officer, St. Francis Hospital
Roslyn, New York
Robert G. Wilson Chairman and Chief Financial
Officer, Lending Tree, Inc.,
Charlotte, North Carolina;
Chairman and President,
Ziani International Capital, Inc.,
Miami, Florida; formerly General
Partner, Goldman Sachs & Company,
New York, New York;
Vice Chairman, Carter Kaplan &
Company, Richmond, Virginia; and
Chairman and Chief Executive
Officer, Ecologic Waste Services,
Inc., Miami, Florida
21
<PAGE>
Dona D. Young Executive Vice President,
Individual Insurance and General
Counsel
Phoenix Home Life Mutual Insurance
Company, Hartford, Connecticut
EXECUTIVE OFFICERS PRINCIPAL OCCUPATION
Robert W. Fiondella Chairman of the Board, President
and Chief Executive Officer
Richard H. Booth Executive Vice President,
Strategic Development
Carl T. Chadburn Executive Vice President
Philip R. McLoughlin Executive Vice President and Chief
Investment Officer
David W. Searfoss Executive Vice President and Chief
Financial Officer
Dona D. Young Executive Vice President,
Individual Insurance and General
Counsel
Kelly J. Carlson Senior Vice President, Business
Practices
Robert G. Chipkin Senior Vice President and
Corporate Actuary
Martin J. Gavin Senior Vice President,
Trust Operations
Randall C. Giangiulio Senior Vice President,
Group Life and Health
Edward P. Hourihan Senior Vice President,
Information Systems
Joseph E. Kelleher Senior Vice President,
Underwriting and Operations
Robert G. Lautensack, Jr. Senior Vice President,
Individual Line Financial
Maura L. Melley Senior Vice President,
Public Affairs
Scott C. Noble Senior Vice President
David R. Pepin Senior Vice President
Robert E. Primmer Senior Vice President,
Distribution and Sales
Frederick W. Sawyer, III Senior Vice President
Simon Y. Tan Senior Vice President, Market and
Product Development
Anthony J. Zeppetella Senior Vice President,
Corporate Portfolio Management
Walter H. Zultowski Senior Vice President, Marketing
and Market Research; formerly
Senior Vice President,
LIMRA International,
Hartford, Connecticut
The above positions reflect the last held position in the organization.
SAFEKEEPING OF THE VUL ACCOUNT'S ASSETS
- --------------------------------------------------------------------------------
Phoenix holds the assets of the VUL Account. The assets of the VUL Account
are kept physically segregated and held separate and apart from the General
Account of Phoenix. Phoenix maintains records of all purchases and redemptions
of shares of the Fund.
SALES OF POLICIES
- -------------------------------------------------------------------------------
Policies may be purchased from registered representatives of W.S. Griffith &
Co., Inc. ("W.S. Griffith"), a New York corporation incorporated on August 7,
1970, licensed to sell Phoenix insurance policies as well as policies, annuity
contracts and funds of companies affiliated with Phoenix. W.S. Griffith, an
indirect subsidiary of Phoenix, is registered as a broker-dealer with the SEC
under the Securities Exchange Act of 1934 ("1934 Act") and is a member of the
National Association of Securities Dealers, Inc. PEPCO serves as national
distributor of the Policies. PEPCO is an indirect subsidiary of Phoenix
Investment Partners, Ltd. ("PXP"), in which Phoenix owns a majority interest.
Policies also may be purchased from other broker-dealers registered under the
1934 Act whose representatives are authorized by applicable law to sell Policies
under terms of agreements provided by PEPCO. Sales commissions will be paid to
registered representatives on purchase payments received by Phoenix under these
Policies. Phoenix will pay a maximum total sales commission of 50% of premiums
to PEPCO. To the extent that the sales charge under the Policies is less than
the sales commissions paid with respect to the Policies, Phoenix will pay the
shortfall from its General Account assets, which will include any profits it may
derive under the Policies.
STATE REGULATION
- --------------------------------------------------------------------------------
Phoenix is subject to the provisions of the New York insurance laws
applicable to mutual life insurance companies and to regulation and supervision
by the New York Superintendent of Insurance. Phoenix also is subject to the
applicable insurance laws of all the other states and jurisdictions in which it
does an insurance business.
State regulation of Phoenix includes certain limitations on the investments
that it may make, including investments for the VUL Account and the GIA. It does
not include, however, any supervision over the investment policies of the VUL
Account.
REPORTS
- -------------------------------------------------------------------------------
All Policyowners will be furnished with those reports required by the 1940
Act and related regulations or by any other applicable law or regulation.
LEGAL PROCEEDINGS
- --------------------------------------------------------------------------------
The VUL Account is not engaged in any litigation. Phoenix is not involved in
any litigation that would have a material adverse effect on the ability of
Phoenix to meet its obligations under the Policies.
22
<PAGE>
LEGAL MATTERS
- --------------------------------------------------------------------------------
Edwin L. Kerr, Counsel of Phoenix, has passed upon the organization of
Phoenix, its authority to issue variable life insurance Policies and the
validity of the Policy. Jorden Burt Boros Cicchetti Berenson & Johnson, LLP have
passed upon legal matters relating to the federal securities and income tax laws
for Phoenix.
REGISTRATION STATEMENT
- --------------------------------------------------------------------------------
A Registration Statement has been filed with the SEC, under the Securities
Act of 1933 ("1933 Act") with respect to the securities offered. This Prospectus
is a summary of the contents of the Policy and other legal documents and does
not contain all the information set forth in the Registration Statement and its
exhibits. We refer you to the registration statement and its exhibits for
further information concerning the VUL Account, Phoenix and the Policy.
YEAR 2000 ISSUE
- -------------------------------------------------------------------------------
Many existing computer programs use only two digits to identify the year in
a date field. This is commonly referred to as the "Year 2000 Issue." Companies
must consider the impact of the upcoming change in the century on their computer
systems. The Year 2000 Issue, if not adequately addressed, could result in
computer system failures or miscalculations causing disruptions of operations
and the possible inability of companies to process transactions. We believe that
the Year 2000 Issue is an important business priority requiring careful analysis
of every business system to be assured that all information systems applications
are century compliant.
We have been addressing the Year 2000 Issue in earnest since 1995 when, with
consultants, a comprehensive inventory and assessment of all business systems,
including those of its subsidiaries, was conducted. We have identified and are
now actively pursuing a number of strategies to address the issue, including:
[diamond] upgrading systems with compliant versions;
[diamond] developing or acquiring new systems to replace those that are
obsolete;
[diamond] and remediating existing systems by converting code or hardware.
Based on current assessments, we expect to have our computer systems
compliant by the end of 1998, with testing to continue through 1999. In
addition, Phoenix is examining the status of its third-party vendors, obtaining
assurances that their software and hardware products will be century compliant
by 1999.
FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
The consolidated financial statements of Phoenix contained herein should be
considered only as bearing upon Phoenix's ability to meet its obligations under
the Policy, and they should not be considered as bearing on the investment
performance of the VUL Account. The financial statements of the VUL Account are
for the Subaccounts available as of the period ended December 31, 1998.
23
<PAGE>
APPENDIX A
PERFORMANCE HISTORY
- --------------------------------------------------------------------------------
THESE RATES OF RETURN ARE NOT AN ESTIMATE OR GUARANTEE OF FUTURE
PERFORMANCE. THEY DO NOT ILLUSTRATE HOW ACTUAL PERFORMANCE WILL AFFECT THE
BENEFITS UNDER A POLICY BECAUSE THEY DO NOT REFLECT COST OF INSURANCE, PREMIUM
TAX CHARGES, PREMIUM SALES CHARGES AND SURRENDER CHARGES, IF APPLICABLE. FOR
THIS INFORMATION SEE APPENDIX C "ILLUSTRATIONS OF DEATH BENEFITS, POLICY VALUES
AND CASH SURRENDER VALUES." Performance information may be expressed as yield
and effective yield of the Money Market Subaccount, as yield of the Multi-Sector
Subaccount and as total return of any Subaccount. Current yield for the Money
Market Subaccount will be based on the income earned by the Subaccount over a
given seven-day period (less a hypothetical charge reflecting deductions for
expenses taken during the period) and then annualized, i.e., the income earned
in the period is assumed to be earned every seven days over a 52-week period and
is stated in terms of an annual percentage return on the investment. Effective
yield is calculated similarly but reflects the compounding effect of earnings on
reinvested dividends. Yield and effective yield reflect the Mortality and
Expense Risk charge on the VUL Account level.
Yield calculations of the Money Market Subaccount used for illustration
purposes are based on the consideration of a hypothetical participant's account
having a balance of exactly one Unit at the beginning of a seven-day period,
which period will end on the date of the most recent financial statements. The
yield for the Subaccount during this seven-day period will be the change in the
value of the hypothetical participant's account's original Unit. The following
is an example of this yield calculation for the Money Market Subaccount based on
a seven-day period ending December 31, 1998.
Example:
Assumptions:
Value of hypothetical pre-existing account with
exactly one unit
at the beginning of the period:................
Value of the same account (excluding capital
changes) at the
end of the seven-day period:....................
Calculation: [To be filed by
Ending account value ........................... Amendment]
Less beginning account value ...................
Net change in account value ....................
Base period return:
(adjusted change/beginning account value) ......
Current yield = return x (365/7) = ...............
Effective yield = [(1 + return)365/7] - 1 = ......
The current yield and effective yield information will fluctuate, and
publication of yield information may not provide a basis for comparison with
bank deposits, other investments which are insured and/or pay a fixed yield for
a stated period of time, or other investment companies, due to charges which
will be deducted on the VUL Account level.
For the Multi-Sector Subaccount, quotations of yield will be based on all
investment income per unit earned during a given 30-day period (including
dividends and interest), less expenses accrued during the period ("net
investment income"), and are computed by dividing net investment income by the
maximum offering price per unit on the last day of the period.
When a Subaccount advertises its total return, it usually will be calculated
for one year, five years, and ten years or since inception if the Subaccount has
not been in existence for at least ten years. Total return is measured by
comparing the value of a hypothetical $10,000 investment in the Subaccount at
the beginning of the relevant period to the value of the investment at the end
of the period, assuming the reinvestment of all distributions at net asset value
and the deduction of the Mortality and Expense Risk, Issue Expense and Monthly
Administrative Charges.
For those Subaccounts within the VUL Account that have not been available
for one of the quoted periods, the average annual total return quotations will
show the investment performance such Subaccount would have achieved (reduced by
the applicable charges) had it been available to invest in shares of the Fund
for the period quoted.
The following performance tables display historical investment results of
the Subaccounts of the VUL Account. This information may be useful in helping
potential investors in deciding which Subaccounts to choose and in assessing the
competence of the investment advisers. The performance figures shown should be
considered in light of the investment objectives and policies, characteristics
and quality of the Subaccounts and market conditions during the periods of time
quoted. The performance figures should not be considered as estimates or
predictions of future performance. Investment return of the Subaccounts are not
guaranteed and will fluctuate. Below are quotations of average annual total
return calculated as described above for all Subaccounts with at least one year
of results. POLICY CHARGES (INCLUDING COST OF INSURANCE, PREMIUM TAX CHARGES,
PREMIUM SALES CHARGES AND SURRENDER CHARGES) ARE NOT REFLECTED.
24
<PAGE>
<TABLE>
<CAPTION>
Average Annual Total Return
---------------------------
for the Period Ended 12/31/98
------------------------------------------------------
Subaccount Inception Date 1 Year 5 Years 10 Years Since Inception
- ---------- -------------- ------ ------- -------- ---------------
<S> <C> <C> <C> <C> <C>
Aberdeen New Asia........................ 9/17/96
Balanced................................. 5/1/92
Engemann Nifty Fifty..................... 3/2/98
Growth................................... 1/1/83
International............................ 5/1/90
Money Market............................. 10/10/82
Mutual Shares Investments................ 11/2/98
Phoenix Growth & Income.................. 3/2/98
Phoenix Value Equity..................... 3/2/98
Real Estate Securities................... 5/1/95
Research Enhanced Index.................. 7/15/97
Schafer Mid-Cap Value.................... 3/2/98
Seneca Mid-Cap Growth.................... 3/2/98
Strategic Allocation..................... 9/17/84 [To be filed by Amendment]
Strategic Theme.......................... 1/29/96
Templeton Asset Allocation............... 11/28/88
Templeton Developing Markets............. 9/15/96
Templeton International.................. 5/1/92
Templeton Stock.......................... 11/4/88
Wanger Foreign Forty..................... 2/1/99
Wanger International Small Cap........... 5/1/95
Wanger Twenty............................ 2/1/99
Wanger U.S. Small Cap.................... 5/1/95
</TABLE>
Advertisements, sales literature and other communications may contain
information about any Series' or Adviser's current investment strategies and
management style. Current strategies and style may change to respond to a
changing market and economic conditions. From time to time, the Series may
discuss specific portfolio holdings or industries in such communications. To
illustrate components of overall performance, the Series may separate their
cumulative and average annual returns into income results and capital gains or
losses; or cite separately, as a return figure, the equity or bond portion of a
Series' portfolio; or compare a Series' equity or bond return figure to
well-known indices of market performance including, but not limited to, the
Standard & Poor's 500 Composite Stock Price Index (the "S&P 500"), Dow Jones
Industrial Average, First Boston High Yield Index and Salomon Brothers Corporate
and Government Bond Indices.
Occasionally, The VUL Account may include in advertisements containing total
return, the ranking of those performance figures relating to such figures for
groups of Subaccounts having similar investment objectives as categorized by
ranking services such as:
Lipper Analytical Services, Inc. Morningstar, Inc.
CDA Investment Technologies, Inc. Weisenberger Financial Services, Inc.
Additionally, the Funds may compare a Series' performance results to other
investment or savings vehicles (such as certificates of deposit) and may refer
to results published in various publications such as:
Changing Times Forbes
Fortune Money
Barrons Business Week
Investor's Business Daily The Stanger Register
Stanger's Investment Adviser The Wall Street Journal
The New York Times Consumer Reports
Registered Representative Financial Planning
Financial Services Weekly Financial World
U.S. News and World Report Standard & Poor's
The Outlook Personal Investor
25
<PAGE>
The Funds may occasionally illustrate the benefits of tax deferral by
comparing taxable investments to investments made through tax-deferred
retirement plans. The total return also may be used to compare the performance
of a Series against certain widely acknowledged outside standards or indices for
stock and bond market performance such as:
S&P 500 Dow Jones Industrial Average
Europe Australia Far East Index (EAFE) Consumers Price Index
Shearson Lehman Corporate Index Shearson Lehman T-Bond Index
The S&P 500 is a commonly quoted market value-weighted and unmanaged index
showing the changes in the aggregate market value of 500 common stocks relative
to the base period 1940-43. The S&P 500 is composed almost entirely of common
stocks of companies listed on the NYSE, although the common stocks of a few
companies listed on the American Stock Exchange or traded over the counter are
included. The 500 companies represented include 400 industrial, 60
transportation and 40 financial services concerns. The S&P 500 represents about
70-80% of the market value of all issues traded on the NYSE.
The Funds' Annual Reports, available upon request and without charge,
contain a discussion of the performance of the Funds and a comparison of that
performance to a securities market index.
26
<PAGE>
<TABLE>
<CAPTION>
ANNUAL TOTAL RETURN*
- ------------------------------------------------------------------------------------------------------------------------------------
1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ----
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Aberdeen New Asia
- ------------------------------------------------------------------------------------------------------------------------------------
Balanced
- ------------------------------------------------------------------------------------------------------------------------------------
Engemann Nifty Fifty
- ------------------------------------------------------------------------------------------------------------------------------------
Growth
- ------------------------------------------------------------------------------------------------------------------------------------
International
- ------------------------------------------------------------------------------------------------------------------------------------
Money Market
- ------------------------------------------------------------------------------------------------------------------------------------
Mutual Shares Investments [To be filed by Amendment]
- ------------------------------------------------------------------------------------------------------------------------------------
Phoenix Growth & Income
- ------------------------------------------------------------------------------------------------------------------------------------
Phoenix Value Equity
- ------------------------------------------------------------------------------------------------------------------------------------
Real Estate Securities
- ------------------------------------------------------------------------------------------------------------------------------------
Research Enhanced Index
- ------------------------------------------------------------------------------------------------------------------------------------
Schafer Mid-Cap Value
- ------------------------------------------------------------------------------------------------------------------------------------
Seneca Mid-Cap Growth
- ------------------------------------------------------------------------------------------------------------------------------------
Strategic Allocation
- ------------------------------------------------------------------------------------------------------------------------------------
Strategic Theme
- ------------------------------------------------------------------------------------------------------------------------------------
Templeton Asset Allocation
- ------------------------------------------------------------------------------------------------------------------------------------
Templeton Developing Markets
- ------------------------------------------------------------------------------------------------------------------------------------
Templeton International
- ------------------------------------------------------------------------------------------------------------------------------------
Templeton Stock
- ------------------------------------------------------------------------------------------------------------------------------------
Wanger Foreign Forty
- ------------------------------------------------------------------------------------------------------------------------------------
Wanger International Small Cap
- ------------------------------------------------------------------------------------------------------------------------------------
Wanger Twenty
- ------------------------------------------------------------------------------------------------------------------------------------
Wanger US Small Cap
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* Sales Charges have not been deducted from the Annual Total Return.
** From Inception.
THESE RATES OF RETURN ARE NOT AN ESTIMATE OR GUARANTEE OF FUTURE PERFORMANCE.
27
<PAGE>
APPENDIX B
THE GUARANTEED INTEREST ACCOUNT
- --------------------------------------------------------------------------------
Contributions to the GIA under the Policy and transfers to the GIA become
part of the Phoenix General Account (the "General Account"), which supports
insurance and annuity obligations. Because of exemptions and exclusions set
forth in the federal securities laws, interest in the General Account has not
been registered under the 1933 Act nor is the General Account registered as an
investment company under the 1940 Act. Accordingly, neither the General Account
nor any interest it is specifically subject to the provisions of the 1933 or
1940 Acts and the staff of the SEC has not reviewed the disclosures in this
Prospectus concerning the GIA. Disclosures regarding the GIA and the General
Account, however, may be subject to certain generally applicable provisions of
the federal securities laws relating to the accuracy and completeness of
statements made in prospectuses.
The General Account is made up of all of the general assets of Phoenix other
than those allocated to any separate account. Premium payments will be allocated
to the GIA and, therefore, the General Account, as elected by the Policyowner at
the time of purchase or as subsequently changed. Phoenix will invest the assets
of the General Account in assets chosen by it and allowed by applicable law.
Investment income from General Account assets is allocated between Phoenix and
the contracts participating in the General Account, in accordance with the terms
of such contracts.
Investment income from the General Account allocated to Phoenix includes
compensation for mortality and expense risks borne by it in connection with
General Account contracts.
The amount of investment income allocated to the Policies will vary from
year to year in the sole discretion of Phoenix. However, Phoenix guarantees that
it will credit interest at a rate of not less than 4% per year, compounded
annually, to amounts allocated to the unloaned portion of the GIA. The loaned
portion of the GIA will be credited interest at an effective annual rate of 2%
(4% on Policies issued in New York). Phoenix may credit interest at a rate in
excess of 4% per year; however, it is not obligated to credit any interest in
excess of 4% per year.
Biweekly, Phoenix will set the excess interest rate, if any, that will apply
to amounts deposited to the GIA. That rate will remain in effect for such
deposits for an initial guarantee period of one full year from the date of
deposit. Upon expiration of the initial one-year guarantee period (and each
subsequent one-year guarantee period thereafter), the rate to be applied to any
deposits whose guaranteed period has just ended will be the same rate as is
applied to new deposits allocated at that time to the GIA. This rate will
likewise remain in effect for a guarantee period of one full year from the date
the new rate is applied.
Excess interest, if any, will be determined by Phoenix based on information
as to expected investment yields. Some of the factors that Phoenix may consider
in determining whether to credit interest to amounts allocated to the GIA and
the amount thereof, are general economic trends, rates of return currently
available and anticipated on investments, regulatory and tax requirements and
competitive factors. ANY INTEREST CREDITED TO AMOUNTS ALLOCATED TO THE GIA IN
EXCESS OF 4% PER YEAR WILL BE DETERMINED IN THE SOLE DISCRETION OF PHOENIX AND
WITHOUT REGARD TO ANY SPECIFIC FORMULA. THE CONTRACT OWNER ASSUMES THE RISK THAT
INTEREST CREDITED TO GIA ALLOCATIONS MAY NOT EXCEED THE MINIMUM GUARANTEE OF 4%
FOR ANY GIVEN YEAR.
Phoenix is aware of no statutory limitations on the maximum amount of
interest it may credit, and the Board of Directors has set no limitations.
However, inherent in Phoenix's exercise of discretion in this regard is the
equitable allocation of distributable earnings and surplus among its various
Policyholders and Contract Owners.
Excess interest, if any, will be credited on the GIA Policy Value. Phoenix
guarantees that, at all times, the GIA Policy Value will not be less than the
amount of premium payments allocated to the GIA, plus interest at the rate of 4%
per year, compounded annually, plus any additional interest which Phoenix may
credit to the GIA, less the sum of all annual administrative or surrender
charges, any applicable premium taxes, deducted from the GIA, and less any
amounts surrendered or loaned. If the Policyowner surrenders the Policy, the
amount available from the GIA will be reduced by any applicable surrender charge
and annual administration charge. See "Deductions and Charges."
IN GENERAL, YOU CAN MAKE ONLY ONE TRANSFER PER YEAR FROM THE GIA. THE AMOUNT
THAT CAN BE TRANSFERRED OUT IS LIMITED TO THE GREATER OF $1,000 OR 25% OF THE
POLICY VALUE IN THE GIA AS OF THE DATE OF THE TRANSFER. IF YOU ELECT THE
SYSTEMATIC TRANSFER PROGRAM, APPROXIMATELY EQUAL AMOUNTS MAY BE TRANSFERRED OUT
OF THE GIA. ALSO, THE TOTAL POLICY VALUE ALLOCATED TO THE GIA MAY BE TRANSFERRED
OUT OF THE GIA TO ONE OR MORE OF THE SUBACCOUNTS OF THE VUL ACCOUNT OVER A
CONSECUTIVE FOUR-YEAR PERIOD ACCORDING TO THE FOLLOWING SCHEDULE:
YEAR ONE: 25% of the value of the GIA
YEAR TWO: 33% of the remaining value
YEAR THREE: 50% of the remaining value
YEAR FOUR: 100% of the remaining value
28
<PAGE>
APPENDIX C
ILLUSTRATIONS OF DEATH BENEFITS, POLICY VALUES ("ACCOUNT VALUES") AND CASH
SURRENDER VALUES
- --------------------------------------------------------------------------------
The tables on the following pages illustrate how a Policy's death benefits,
account values and Cash Surrender Value could vary over time assuming constant
hypothetical gross (after tax) annual investment returns of 0%, 6% and 12%. The
Policy benefits will differ from those shown in the tables if the annual
investment returns are not absolutely constant. That is, the figures will be
different if the returns averaged 0% to 12% over a period of years but went
above or below those figures in individual Policy Years. The Policy benefits
also will differ, depending on your premium allocations to each Subaccount of
the VUL Account, if the overall actual rates of return averaged 0% to 12% but
went above or below those figures for the individual Subaccounts. The tables are
for standard risk males and females who have never smoked. In states where cost
of insurance rates are not based on the Insured's sex, the tables designated
"male" apply to all standard risk Insureds who have never smoked. Account values
and Cash Surrender Values may be lower for smokers or former smokers or for risk
classes involving higher mortality risk. Planned premium payments are assumed to
be paid at the beginning of each Policy Year. The difference between the Policy
Value and the Cash Surrender Value in the first 10 years is the surrender
charge. Tables are included for death benefit Option 1 and Option 2. Tables also
are included to reflect the blended cost of insurance charge applied under a
Multiple Life Policy.
The death benefit, account value and Cash Surrender Value amounts reflect
the following current charges:
1. Issue charge of $600.
2. Monthly administrative charge of $20 per month. ($20 per month for Face
Amounts of less than or equal to $400,000; $0.05 per thousand for Face
Amounts of $400,001 up to $1,600,000; and $80 per month for Face Amounts
over $1,600,000.)
3. Premium tax charge of 2.25%.
4. A federal tax charge of 1.5%.
5. Cost of insurance charge. The tables illustrate cost of insurance at both
the current rates and at the maximum rates guaranteed in the Policies. (See
"Charges and Deductions--Cost of Insurance.")
6. Mortality and expense risk charge, which is a daily charge equivalent to
.80% on an annual basis (.25% on an annual basis after the 15th Policy
Year), against the VUL Account for mortality and expense risks. (See
"Charges and Deductions--Mortality and Expense Risk Charge.")
These illustrations also assume an average investment advisory fee of .76%
on an annual basis, of the average daily net asset value of each of the Series
of the Funds. These illustrations also assume other ongoing average Fund
expenses of .28%. Management may decide to limit the amount of expense
reimbursement in the future. If this reimbursement had not been in place for the
fiscal year ended December 31, 1998, average total operating expenses for the
Series would have been approximately 1.17% of the average net assets. (See
"Charges and Deductions--Investment Management Charge.")
Taking into account the mortality and expense risk charge and the investment
advisory fees and expenses, the gross annual investment return rates of 0%, 6%
and 12% on the Funds' assets are equivalent to net annual investment return
rates of approximately -1.83%, 4.12% and 10.08%, respectively (applicable for
the first 15 Policy Years for Single Life Policies and -1.29%, 4.70% and 10.68%,
respectively, after the 15th Policy Year for Single Life Policies). For
individual illustrations, interest rates ranging between 0% and 12% may be
selected in place of the 6% rate.
The hypothetical returns shown in the tables are without any tax charges
that may be attributable to the VUL Account in the future. If such tax charges
are imposed in the future, then in order to produce after tax returns equal to
those illustrated for 0%, 6% and 12%, a sufficiently higher amount in excess of
the hypothetical interest rates would have to be earned. (See "Charges and
Deductions--Other Charges--Taxes.")
The second column of each table shows the amount that would accumulate if an
amount equal to the premiums paid were invested to earn interest, after taxes,
at 5% compounded annually. These tables show that if a Policy is returned in its
very early years for payment of its Cash Surrender Value, that Cash Surrender
Value may be low in comparison to the amount of the premiums accumulated with
interest. Thus, the cost of owning a Policy for a relatively short time may be
high.
On request, we will furnish the Policyowner with a comparable illustration
based on the age and sex of the proposed insured person(s), standard risk
assumptions and the initial face amount and planned premium chosen.
29
<PAGE>
PHOENIX HOME LIFE MUTUAL INSURANCE COMPANY PAGE 1 OF 2
MALE 35 NEVERSMOKE FACE AMOUNT: $250,000
FEMALE 35 NEVERSMOKE INITIAL ANNUAL PREMIUM: $1,200
<TABLE>
ESTATE EDGE -- A FLEXIBLE PREMIUM VARIABLE
UNIVERSAL LIFE INSURANCE POLICY OPTION 1
ASSUMING CURRENT CHARGES
<CAPTION>
CASH CASH CASH
ASSUMED PREMIUM ACCOUNT SURRENDER DEATH ACCOUNT SURRENDER DEATH ACCOUNT SURRENDER DEATH
PREMIUM ACCUM. VALUE VALUE BENEFIT VALUE VALUE BENEFIT VALUE VALUE BENEFIT
YEAR PAYMENTS @ 5.0% @ 0% @ 0% @ 0% @ 6% @ 6% @ 6% @ 12% @ 12% @ 12%
- -------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,200 1,260 67 0 250,000 94 0 250,000 122 0 250,000
2 1,200 2,583 903 0 250,000 993 0 250,000 1,087 0 250,000
3 1,200 3,972 1,723 523 250,000 1,928 728 250,000 2,148 948 250,000
4 1,200 5,431 2,528 1,328 250,000 2,902 1,702 250,000 3,316 2,116 250,000
5 1,200 6,962 3,319 2,119 250,000 3,916 2,716 250,000 4,602 3,402 250,000
6 1,200 8,570 4,095 2,943 250,000 4,971 3,819 250,000 6,018 4,866 250,000
7 1,200 10,259 4,856 3,992 250,000 6,070 5,206 250,000 7,575 6,711 250,000
8 1,200 12,032 5,603 5,027 250,000 7,213 6,637 250,000 9,289 8,713 250,000
9 1,200 13,893 6,336 6,048 250,000 8,403 8,115 250,000 11,175 10,887 250,000
10 1,200 15,848 7,054 7,054 250,000 9,642 9,642 250,000 13,251 13,251 250,000
11 1,200 17,901 8,056 8,056 250,000 11,238 11,238 250,000 15,854 15,854 250,000
12 1,200 20,056 9,038 9,038 250,000 12,900 12,900 250,000 18,718 18,718 250,000
13 1,200 22,318 10,000 10,000 250,000 14,628 14,628 250,000 21,869 21,869 250,000
14 1,200 24,694 10,944 10,944 250,000 16,427 16,427 250,000 25,337 25,337 250,000
15 1,200 27,189 11,869 11,869 250,000 18,297 18,297 250,000 29,152 29,152 250,000
16 1,200 29,808 12,845 12,845 250,000 20,355 20,355 250,000 33,534 33,534 250,000
17 1,200 32,559 13,805 13,805 250,000 22,506 22,506 250,000 38,382 38,382 250,000
18 1,200 35,447 14,750 14,750 250,000 24,755 24,755 250,000 43,744 43,744 250,000
19 1,200 38,479 15,677 15,677 250,000 27,106 27,106 250,000 49,676 49,676 250,000
20 1,200 41,663 16,588 16,588 250,000 29,561 29,561 250,000 56,236 56,236 250,000
@ 65 1,200 83,713 24,919 24,919 250,000 64,554 64,554 250,000 195,305 195,305 250,000
</TABLE>
Based on 0% interest rate and guaranteed charges, the policy will lapse in
year 33.
Death benefit, account value, and Cash Surrender Value are based on
hypothetical gross interest rates shown, assume current and guaranteed charges
and no policy loans or withdrawals, and are calculated at the end of the Policy
Year. Assumed premium payments shown are assumed paid in full at the beginning
of the Policy Year. Payment of premiums shown other than in full at the
beginning of the Policy Year would reduce values and benefits below the
hypothetical illustrated amounts shown. Values shown reflect an effective annual
asset charge of 1.84% for 15 years, 1.29% thereafter (includes mortality and
expense risk charge of 0.8% for fifteen years, then 0.25% and average fund
operating expenses of 1.04% applicable to the investment Subaccounts of the VUL
Separate Account). Hypothetical gross interest rates are presented for
illustrative purposes only to illustrate funds allocated entirely to the
investment Subaccounts of the VUL Separate Account and do not in any way
represent actual results or suggest that such results will be achieved in the
future. Actual values will differ from those shown whenever actual investment
results differ from hypothetical gross interest rates illustrated. A Guaranteed
Interest Account providing interest at a minimum guaranteed rate of 4% also is
available under this product through the General Account.
This illustration assumes a premium tax of 2.25%.
30
<PAGE>
PHOENIX HOME LIFE MUTUAL INSURANCE COMPANY PAGE 2 OF 2
MALE 35 NEVERSMOKE FACE AMOUNT: $250,000
FEMALE 35 NEVERSMOKE INITIAL ANNUAL PREMIUM: $1,200
<TABLE>
ESTATE EDGE -- A FLEXIBLE PREMIUM VARIABLE
UNIVERSAL LIFE INSURANCE POLICY OPTION 1
ASSUMING GUARANTEED CHARGES
<CAPTION>
CASH CASH CASH
ASSUMED PREMIUM ACCOUNT SURRENDER DEATH ACCOUNT SURRENDER DEATH ACCOUNT SURRENDER DEATH
PREMIUM ACCUM. VALUE VALUE BENEFIT VALUE VALUE BENEFIT VALUE VALUE BENEFIT
YEAR PAYMENTS @ 5.0% @ 0% @ 0% @ 0% @ 6% @ 6% @ 6% @ 12% @ 12% @ 12%
- -------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,200 1,260 66 0 250,000 93 0 250,000 121 0 250,000
2 1,200 2,583 900 0 250,000 990 0 250,000 1,084 0 250,000
3 1,200 3,972 1,718 518 250,000 1,922 722 250,000 2,142 942 250,000
4 1,200 5,431 2,518 1,318 250,000 2,890 1,690 250,000 3,304 2,104 250,000
5 1,200 6,962 3,301 2,101 250,000 3,896 2,696 250,000 4,581 3,381 250,000
6 1,200 8,570 4,068 2,916 250,000 4,941 3,789 250,000 5,984 4,832 250,000
7 1,200 10,259 4,817 3,953 250,000 6,025 5,161 250,000 7,525 6,661 250,000
8 1,200 12,032 5,548 4,972 250,000 7,151 6,575 250,000 9,217 8,641 250,000
9 1,200 13,893 6,262 5,974 250,000 8,317 8,029 250,000 11,074 10,786 250,000
10 1,200 15,848 6,957 6,957 250,000 9,527 9,527 250,000 13,114 13,114 250,000
11 1,200 17,901 7,930 7,930 250,000 11,088 11,088 250,000 15,672 15,672 250,000
12 1,200 20,056 8,878 8,878 250,000 12,706 12,706 250,000 18,480 18,480 250,000
13 1,200 22,318 9,799 9,799 250,000 14,382 14,382 250,000 21,563 21,563 250,000
14 1,200 24,694 10,694 10,694 250,000 16,117 16,117 250,000 24,947 24,947 250,000
15 1,200 27,189 11,561 11,561 250,000 17,913 17,913 250,000 28,661 28,661 250,000
16 1,200 29,808 12,468 12,468 250,000 19,878 19,878 250,000 32,919 32,919 250,000
17 1,200 32,559 13,346 13,346 250,000 21,921 21,921 250,000 37,616 37,616 250,000
18 1,200 35,447 14,194 14,194 250,000 24,040 24,040 250,000 42,800 42,800 250,000
19 1,200 38,479 15,007 15,007 250,000 26,237 26,237 250,000 48,517 48,517 250,000
20 1,200 41,663 15,782 15,782 250,000 28,510 28,510 250,000 54,825 54,825 250,000
@ 65 1,200 83,713 19,797 19,797 250,000 57,793 57,793 250,000 186,677 186,677 250,000
</TABLE>
Based on 0% interest rate and guaranteed charges, the policy will lapse in
year 39.
Death benefit, account value, and Cash Surrender Value are based on
hypothetical gross interest rates shown, assume current and guaranteed charges
and no policy loans or withdrawals, and are calculated at the end of the Policy
Year. Assumed premium payments shown are assumed paid in full at the beginning
of the Policy Year. Payment of premiums shown other than in full at the
beginning of the Policy Year would reduce values and benefits below the
hypothetical illustrated amounts shown. Values shown reflect an effective annual
asset charge of 1.84% for 15 years, 1.29% thereafter (includes mortality and
expense risk charge of 0.8% for fifteen years, then 0.25% and average fund
operating expenses of 1.04% applicable to the investment Subaccounts of the VUL
Separate Account). Hypothetical gross interest rates are presented for
illustrative purposes only to illustrate funds allocated entirely to the
investment Subaccounts of the VUL Separate Account and do not in any way
represent actual results or suggest that such results will be achieved in the
future. Actual values will differ from those shown whenever actual investment
results differ from hypothetical gross interest rates illustrated. A Guaranteed
Interest Account providing interest at a minimum guaranteed rate of 4% also is
available under this product through the General Account.
This illustration assumes a premium tax of 2.25%.
31
<PAGE>
PHOENIX HOME LIFE MUTUAL INSURANCE COMPANY PAGE 1 OF 2
MALE 35 NEVERSMOKE FACE AMOUNT: $250,000
FEMALE 35 NEVERSMOKE INITIAL ANNUAL PREMIUM: $1,200
<TABLE>
ESTATE EDGE -- A FLEXIBLE PREMIUM VARIABLE
UNIVERSAL LIFE INSURANCE POLICY OPTION 2
ASSUMING CURRENT CHARGES
<CAPTION>
CASH CASH CASH
ASSUMED PREMIUM ACCOUNT SURRENDER DEATH ACCOUNT SURRENDER DEATH ACCOUNT SURRENDER DEATH
PREMIUM ACCUM. VALUE VALUE BENEFIT VALUE VALUE BENEFIT VALUE VALUE BENEFIT
YEAR PAYMENTS @ 5.0% @ 0% @ 0% @ 0% @ 6% @ 6% @ 6% @ 12% @ 12% @ 12%
- -------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,200 1,260 67 0 250,067 94 0 250,095 122 0 250,123
2 1,200 2,583 902 0 250,903 992 0 250,993 1,086 0 251,087
3 1,200 3,972 1,723 523 251,723 1,928 728 251,928 2,148 948 252,148
4 1,200 5,431 2,528 1,328 252,529 2,902 1,702 252,902 3,316 2,116 253,317
5 1,200 6,962 3,319 2,119 253,319 3,915 2,715 253,916 4,602 3,402 254,603
6 1,200 8,570 4,095 2,943 254,095 4,971 3,819 254,971 6,017 4,865 256,018
7 1,200 10,259 4,856 3,992 254,856 6,069 5,205 256,070 7,575 6,711 257,575
8 1,200 12,032 5,603 5,027 255,603 7,213 6,637 257,213 9,289 8,713 259,289
9 1,200 13,893 6,335 6,047 256,336 8,403 8,115 258,403 11,175 10,887 261,175
10 1,200 15,848 7,054 7,054 257,054 9,641 9,641 259,641 13,250 13,250 263,250
11 1,200 17,901 8,055 8,055 258,055 11,237 11,237 261,238 15,852 15,852 265,853
12 1,200 20,056 9,037 9,037 259,037 12,898 12,898 262,899 18,716 18,716 268,716
13 1,200 22,318 9,999 9,999 260,000 14,627 14,627 264,627 21,867 21,867 271,867
14 1,200 24,694 10,943 10,943 260,943 16,424 16,424 266,425 25,333 25,333 275,334
15 1,200 27,189 11,867 11,867 261,867 18,294 18,294 268,295 29,147 29,147 279,147
16 1,200 29,808 12,842 12,842 262,842 20,351 20,251 270,351 33,527 33,527 283,527
17 1,200 32,559 13,802 13,802 263,802 22,500 22,500 272,501 38,371 38,371 288,371
18 1,200 35,447 14,745 14,745 264,745 24,747 24,747 274,748 43,729 43,729 293,729
19 1,200 38,479 15,671 15,671 265,672 27,094 27,094 277,095 49,653 49,653 299,654
20 1,200 41,663 16,579 16,579 266,580 29,546 29,546 279,546 56,205 56,205 306,205
@ 65 1,200 83,713 24,786 24,786 274,786 64,181 64,181 314,181 194,122 194,122 444,123
</TABLE>
Based on 0% interest rate and guaranteed charges, the policy will lapse in
year 33.
Death benefit, account value, and Cash Surrender Value are based on
hypothetical gross interest rates shown, assume current and guaranteed charges
and no policy loans or withdrawals, and are calculated at the end of the Policy
Year. Assumed premium payments shown are assumed paid in full at the beginning
of the Policy Year. Payment of premiums shown other than in full at the
beginning of the Policy Year would reduce values and benefits below the
hypothetical illustrated amounts shown. Values shown reflect an effective annual
asset charge of 1.84% for 15 years, 1.29% thereafter (includes mortality and
expense risk charge of 0.8% for fifteen years, then 0.25% and average fund
operating expenses of 1.04% applicable to the investment Subaccounts of the VUL
Separate Account). Hypothetical gross interest rates are presented for
illustrative purposes only to illustrate funds allocated entirely to the
investment Subaccounts of the VUL Separate Account and do not in any way
represent actual results or suggest that such results will be achieved in the
future. Actual values will differ from those shown whenever actual investment
results differ from hypothetical gross interest rates illustrated. A Guaranteed
Interest Account providing interest at a minimum guaranteed rate of 4% also is
available under this product through the General Account.
This illustration assumes a premium tax of 2.25%.
32
<PAGE>
PHOENIX HOME LIFE MUTUAL INSURANCE COMPANY PAGE 2 OF 2
MALE 35 NEVERSMOKE FACE AMOUNT: $250,000
FEMALE 35 NEVERSMOKE INITIAL ANNUAL PREMIUM: $1,200
<TABLE>
ESTATE EDGE -- A FLEXIBLE PREMIUM VARIABLE
UNIVERSAL LIFE INSURANCE POLICY OPTION 2
ASSUMING GUARANTEED CHARGES
<CAPTION>
CASH CASH CASH
ASSUMED PREMIUM ACCOUNT SURRENDER DEATH ACCOUNT SURRENDER DEATH ACCOUNT SURRENDER DEATH
PREMIUM ACCUM. VALUE VALUE BENEFIT VALUE VALUE BENEFIT VALUE VALUE BENEFIT
YEAR PAYMENTS @ 5.0% @ 0% @ 0% @ 0% @ 6% @ 6% @ 6% @ 12% @ 12% @ 12%
- -------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,200 1,260 66 0 250,067 93 0 250,094 121 0 250,122
2 1,200 2,583 900 0 250,901 990 0 250,990 1,084 0 251,084
3 1,200 3,972 1,717 517 251,718 1,922 722 251,922 2,142 942 252,142
4 1,200 5,431 2,518 1,318 252,518 2,890 1,690 252,891 3,304 2,104 253,304
5 1,200 6,962 3,301 2,101 253,301 3,896 2,696 253,896 4,581 3,381 254,581
6 1,200 8,570 4,067 2,915 254,068 4,940 3,788 254,941 5,983 4,831 255,984
7 1,200 10,259 4,816 3,952 254,817 6,024 5,160 256,025 7,523 6,659 257,524
8 1,200 12,032 5,547 4,971 255,548 7,149 6,573 257,149 9,215 8,639 259,215
9 1,200 13,893 6,260 5,972 256,260 8,314 8,026 258,315 11,071 10,783 261,071
10 1,200 15,848 6,954 6,954 256,955 9,523 9,523 259,523 13,109 13,109 263,109
11 1,200 17,901 7,926 7,926 257,927 11,082 11,082 261,083 15,664 15,664 265,664
12 1,200 20,056 8,872 8,872 258,873 12,698 12,698 262,698 18,468 18,468 268,468
13 1,200 22,318 9,792 9,792 259,793 14,370 14,370 264,371 21,545 21,545 271,545
14 1,200 24,694 10,685 10,685 260,685 16,101 16,101 266,102 24,921 24,921 274,921
15 1,200 27,189 11,548 11,548 261,549 17,891 17,891 267,891 28,624 28,624 278,624
16 1,200 29,808 12,450 12,450 262,451 19,848 19,848 269,849 32,865 32,865 282,866
17 1,200 32,559 13,323 13,323 263,324 21,879 21,879 271,880 37,541 37,541 287,542
18 1,200 35,447 14,164 14,164 264,164 23,984 23,984 273,985 42,694 42,694 292,694
19 1,200 38,479 14,968 14,968 264,968 26,162 26,162 276,162 48,370 48,370 298,371
20 1,200 41,663 15,731 15,731 265,732 28,411 28,411 278,411 54,621 54,621 304,622
@ 65 1,200 83,713 19,265 19,265 269,265 56,180 56,180 306,181 181,332 181,332 431,333
</TABLE>
Based on 0% interest rate and guaranteed charges, the policy will lapse in
year 38.
Death benefit, account value, and Cash Surrender Value are based on
hypothetical gross interest rates shown, assume current and guaranteed charges
and no policy loans or withdrawals, and are calculated at the end of the Policy
Year. Assumed premium payments shown are assumed paid in full at the beginning
of the Policy Year. Payment of premiums shown other than in full at the
beginning of the Policy Year would reduce values and benefits below the
hypothetical illustrated amounts shown. Values shown reflect an effective annual
asset charge of 1.84% for 15 years, 1.29% thereafter (includes mortality and
expense risk charge of 0.8% for fifteen years, then 0.25% and average fund
operating expenses of 1.04% applicable to the investment Subaccounts of the VUL
Separate Account). Hypothetical gross interest rates are presented for
illustrative purposes only to illustrate funds allocated entirely to the
investment Subaccounts of the VUL Separate Account and do not in any way
represent actual results or suggest that such results will be achieved in the
future. Actual values will differ from those shown whenever actual investment
results differ from hypothetical gross interest rates illustrated. A Guaranteed
Interest Account providing interest at a minimum guaranteed rate of 4% also is
available under this product through the General Account.
This illustration assumes a premium tax of 2.25%.
33
<PAGE>
Phoenix Home Life Mutual
Insurance Company
Consolidated Financial Statements
December 31, 1998 and 1997
(To be filed by Amendment)
34
<PAGE>
Phoenix Home Life
Variable Universal Life Account
Financial Statements
December 31, 1998
(To be filed by Amendment)
35
<PAGE>
PART II. OTHER INFORMATION
UNDERTAKING TO FILE REPORTS
Subject to the terms and conditions of Section 15(d) of the Securities
Exchange Act of 1934, the undersigned registrant hereby undertakes to file with
the Securities and Exchange Commission such supplementary and periodic
information, documents and reports as may be prescribed by any rule or
regulation of the Commission heretofore or hereafter duly adopted pursuant to
authority conferred in that Section.
RULE 484 UNDERTAKING
Section 723 of the New York Business Corporation Law, as made applicable to
insurance companies by Section 108 of the New York Insurance Law, provides that
a corporation may indemnify any director or officer of the corporation made, or
threatened to be made, a party to an action or proceeding other than one by or
in the right of the corporation to procure a judgment in its favor, whether
civil or criminal, including an action by or in the right of any other
corporation of any type or kind, by reason of the fact that he, his testator or
intestate, served such other corporation in any capacity at the request of the
indemnifying corporation.
Article VI Section 6.1 of the By-Laws of Phoenix Home Life provides that:
"To the full extent permitted by the laws of the State of New York, the Company
shall indemnify any person made or threatened to be made a party to any action,
proceeding or investigation, whether civil or criminal, by reason of the fact
that such person ... is or was a Director or Officer of the Company; or ...
serves or served another corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise in any capacity at the request of the
Company, and also is or was a Director or Officer of the Company ... The Company
shall also indemnify any [such] person ... by reason of the fact that such
person or such person's testator or intestate is or was an employee or agent of
the Company ...."
Insofar as indemnification for liability arising under the Securities Act of
1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
REPRESENTATION PURSUANT TO SECTION 26(E)(2)(A) UNDER
THE INVESTMENT COMPANY ACT OF 1940.
Pursuant to Section 26(e)(2)(A) of the Investment Company Act of 1940, as
amended, Phoenix Home Life Mutual Insurance Company represents that the fees and
charges deducted under the Policies, in the aggregate, are reasonable in
relation to the services rendered, the expenses expected to be incurred and the
risks to be assumed thereunder by Phoenix Home Life Mutual Insurance Company.
II-1
<PAGE>
CONTENTS OF REGISTRATION STATEMENT
This Form S-6 Registration Statement comprises the following papers and
documents:
The facing sheet.
The cross-reference sheet to Form N-8B-2.
The Prospectus describing Phoenix Home Life Mutual Insurance Company Policy
Form V602 and riders thereto, "Estate Edge," consisting of 35 pages.
The undertaking to file reports.
The Rule 484 undertaking.
Representation Pursuant to Section 26(e)(2)(A) of the Investment Company Act
of 1940.
The signature page.
The powers of attorney were filed via Edgar with registrant's Post-Effective
Amendment No. 1 on February 28, 1998 and are incorporated herein by
reference.
Written consents of the following persons:
(a) Edwin L. Kerr, Esq.*
(b) Jorden Burt Boros Cicchetti Berenson & Johnson LLP*
(c) Price Waterhouse, LLP*
(d) Paul M. Fischer, F.S.A.*
The following exhibits:
1. The following exhibits correspond to those required by paragraph A to the
instructions as to exhibits in Form N-8B-2:
A. (1) Resolution of the Board of Directors of Depositor establishing
the VUL Account is incorporated herein by reference to
Registration Statement on Form S-6, Registration No. 33-23251,
filed on July 21, 1988.
(2) Not Applicable.
(3) Distribution of Policies:
(a) Master Service and Distribution Compliance Agreement between
Depositor and Phoenix Equity Planning Corporation dated
December 31, 1996, filed via Edgar with Registrant's
Registration Statement on Form S-6 filed on March 12, 1997.
(b) Form of Broker Dealer Supervisory and Service Agreement
between Phoenix Equity Planning Corporation and Independent
Brokers with respect to the sale of Policies, filed via Edgar
with Pre-Effective Amendment No. 1 on September 10, 1997.
(c) Not Applicable.
(4) Not Applicable.
(5) Specimen Policies with optional riders.
Flexible Premium Variable Universal Life Insurance Policy Form
Number V602 of Depositor, filed via Edgar with Pre-Effective
Amendment No. 1 on September 10, 1997.
(6) (a) Charter of Phoenix Home Life Mutual Insurance Company is
incorporated herein by reference to Post-Effective Amendment
No. 12 to Form S-6, Registration No. 33-23251, filed on
February 13, 1996.
(b) By-Laws of Phoenix Home Life Mutual Insurance Company is
incorporated herein by reference to Post-Effective Amendment
No. 12 to Form S-6, Registration No. 33-23251, filed on
February 13, 1996.
(7) Not Applicable.
(8) Not Applicable.
(9) Not Applicable.
(10) Form of application for Estate Edge, filed via Edgar with
Pre-Effective Amendment No. 1, filed on September 10, 1997.
(11) Memorandum describing transfer and redemption procedures and
method of computing adjustments in payments and cash values upon
conversion to fixed benefit policies, filed via Edgar with
Registrant's Registration Statement on Form S-6 filed on March 12,
1997.
II-2
<PAGE>
2. Opinion of Edwin L. Kerr, Esq., Counsel of Depositor as to the legality of
the securities being registered, filed via Edgar with Pre-Effective
Amendment No. 2 on September 15, 1997 and incorporated herein by
reference.
3. Not Applicable. No financial statement will be omitted from the Prospectus
pursuant to Instruction 1(b) or (c) of Part I.
4. Not Applicable.
5. Not Applicable.
6. Consent of Jorden Burt Boros Cicchetti Berenson & Johnson, LLP.*
7. Consent of Price Waterhouse, LLP.*
8. Consent of Edwin L. Kerr, Esq.*
9. Consent of Paul M. Fischer, F.S.A., CLU, ChFC*
--------------
* To be filed by Amendment.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant,
Phoenix Home Life Variable Universal Life Account certifies that it meets all
the requirements for effectiveness of this Registration Statement under Rule
485(b) of the Securities Act and has duly caused this Registration Statement to
be signed on its behalf by the undersigned thereunto duly authorized, in the
City of Hartford, State of Connecticut on the 28th day of January, 1999.
PHOENIX HOME LIFE VARIABLE UNIVERSAL LIFE ACCOUNT
-------------------------------------------------
(Registrant)
By: PHOENIX HOME LIFE MUTUAL INSURANCE COMPANY
------------------------------------------
(Depositor)
By: /s/ Dona D. Young
------------------------------------------
*Dona D. Young, Executive Vice President,
Individual Insurance and General Counsel
ATTEST: /s/John H. Beers
--------------------------------------------
John H. Beers, Assistant Secretary
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities indicated on the 29th day of January, 1999.
SIGNATURE TITLE
--------- -----
Director
-------------------------------------
*Sal H. Alfiero
Director
-------------------------------------
*J. Carter Bacot
Director
-------------------------------------
*Carol H. Baldi
Director
-------------------------------------
*Richard H. Booth
Director
-------------------------------------
*Peter C. Browning
Director
-------------------------------------
*Arthur P. Byrne
Director
-------------------------------------
*Richard N. Cooper
Director
-------------------------------------
*Gordon J. Davis
Chairman of the Board,
------------------------------------- President and Chief
*Robert W. Fiondella Executive Officer (Principal
Executive Officer)
S-1(c)
<PAGE>
SIGNATURE TITLE
--------- -----
Director
-------------------------------------
*Jerry J. Jasinowski
Director
-------------------------------------
*John W. Johnstone
Director
-------------------------------------
*Marilyn E. LaMarche
Director
-------------------------------------
*Philip R. McLoughlin
Director
-------------------------------------
*Indra Nooyi
Director
-------------------------------------
*Charles J. Paydos
Executive Vice President
------------------------------------- and Chief Financial
*David W. Searfoss Officer (Principal Accounting
and Financial Officer)
Director
-------------------------------------
*Robert F. Vizza
Director
-------------------------------------
*Robert G. Wilson
Director
-------------------------------------
*Dona D. Young
By: /s/ Dona D. Young
-------------------------------------------------
*Dona D. Young as Attorney-in-Fact pursuant to Powers of Attorney,
previously filed
S-2(c)
