Supplement to Prospectus Dated May 1, 1997
Supplement dated March 10, 1998
This Supplement should be retained with the current Prospectus for your variable
annuity contract issued by American Skandia Life Assurance Corporation
("American Skandia"). If you do not have a current prospectus, please contact
American Skandia at 1-800-SKANDIA.
Notice of Proxy
Contract Owners with Account Value allocated to the Berger Capital Growth
Sub-account as of March 9, 1998 ("record date") will be receiving a solicitation
of proxy as beneficial owners of units of the Sub-account that invest in
underlying shares of the Berger Capital Growth portfolio of American Skandia
Trust ("shareholders").
Shareholders of the Berger Capital Growth portfolio are being asked to reappoint
American Skandia Investment Services, Incorporated as investment manager of the
portfolio, to appoint Neuberger&Berman Management Incorporated as the new
portfolio sub-advisor, to change the portfolio's investment objective and
certain fundamental investment restrictions, and to change the portfolio's name
to "Neuberger&Berman Mid-Cap Growth."
Contract Owners who choose to allocate Account Value to the Berger Capital
Growth Sub-account after the record date will not receive a proxy solicitation
and will not be entitled to vote on the changes outlined above. Contract Owners
should take this into consideration if they are considering allocating Account
Value to the Berger Capital Growth Sub-account.
Roth IRA/SEP IRA/SIMPLE IRA
The section of the Prospectus entitled "Purchasing Annuities - Uses of the
Annuity" is amended as follows:
The Annuity may be issued in connection with or purchased as a funding vehicle
for certain retirement plans designed to meet the requirements of various
sections of the Code. These include, but are not limited to: (a) Section 403(b)
(tax-sheltered annuities available to employees of certain qualifying
employers); (b) Section 408 (individual retirement accounts and individual
retirement annuities - "IRAs"; Simplified Employee Pensions - "SEPs"; and
Savings Incentive Match Plans for Employees - "SIMPLE IRAs"); and (c) Section
408A (Roth IRAs).
The section of the Prospectus entitled "Certain Tax Considerations - Penalty on
Distributions" is amended as follows:
With respect to Roth IRAs only, distributions are not subject to federal income
tax or the 10% penalty tax if five (5) tax years have passed since the first
contribution was made or any conversion from a traditional IRA was made, and the
distribution is made (a) once the taxpayer is age 59 1/2 or older, (b) upon the
death or disability of the taxpayer, or (c) for qualified first-time home buyer
expenses, subject to certain limitations. Distributions from a Roth IRA that are
not "qualified" as described above may be subject to a penalty tax.
Wells XT/WellsVA+ (3/98)
The section of the Prospectus entitled "Certain Tax Considerations - Individual
Retirement Programs" is amended as follows:
Eligible individuals may maintain an individual retirement account or individual
retirement annuity ("IRA"). Subject to limitations, contributions of certain
amounts may be deductible from gross income. Such persons may also maintain a
form of IRA called a "Roth IRA". Contributions to a Roth IRA are not deductible
but, under certain circumstances, distributions from such an account are
tax-free. Purchasers of IRAs and Roth IRAs will receive a special disclosure
document, which describes limitations on eligibility, contributions,
transferability and distributions. It also describes the conditions under which
distributions from IRAs and qualified plans may be rolled over or transferred
into an IRA on a tax-deferred basis and the conditions under which distributions
from traditional IRAs may be rolled over to, or the traditional IRA itself may
be converted into a Roth IRA. Eligible employers that meet specified criteria
may establish savings incentive match plans for employees or Simplified Employee
Pensions using the employees' IRAs. These arrangements are known as SIMPLE IRAs
and others as SEP IRAs. Employer contributions that may be made to SIMPLE IRAs
and SEP IRAs are larger than the amounts that may be contributed to other IRAs,
and may be deductible to the employer.
