<PAGE>
December 31, 1999 . Pacific Select Fund
. Pacific Select Exec
Separate Account of
Pacific Life Insurance Company
Annual
Reports
PACIFIC SELECT
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PACIFIC SELECT FUND
<S> <C>
Chairman's Letter................................................... A-1
Performance Discussion.............................................. A-2
Independent Auditors' Report........................................ B-1
Financial Statements:
Statements of Assets and Liabilities.............................. B-2
Statements of Operations.......................................... B-4
Statements of Changes in Net Assets............................... B-6
Financial Highlights................................................ C-1
Schedules of Investments and Notes.................................. D-1
Notes to Financial Statements....................................... E-1
Special Meeting of Shareholders..................................... F-1
PACIFIC SELECT EXEC SEPARATE ACCOUNT
Chairman's Letter................................................... G-1
Policy Illustrations................................................ G-2
Independent Auditors' Report........................................ H-1
Financial Statements:
Statement of Assets and Liabilities............................... H-2
Statement of Operations........................................... H-4
Statement of Changes in Net Assets................................ H-6
Notes to Financial Statements....................................... I-1
</TABLE>
<PAGE>
Dear Pacific Life Variable Universal Life Insurance Policy Owner:
We are pleased to share with you the 1999 Annual Report of the Pacific Select
Exec Separate Account ("Separate Account") of Pacific Life Insurance Company
("Pacific Life").
The Separate Account supports your Pacific Life Variable Universal Life
Insurance Policy ("the Policy"). The Separate Account is divided into
subaccounts, called Variable Accounts. A fixed account option is also
available.
Attached are charts of a hypothetical policy for each of the Variable
Universal Life Insurance Policies supported by the Pacific Select Exec
Separate Account, which indicate the Accumulated Values and Cash Surrender
Values as of December 31, 1999, assuming 100% of the net premium payment was
allocated to each Variable Account.
If you have any questions, please contact your Registered Representative, or
call Pacific Life's Marketing Department at our toll free number 1-800-800-
7681.
Sincerely,
/s/ THOMAS C. SUTTON
Thomas C. Sutton
Chairman and Chief Executive Officer
Pacific Life Insurance Company
G-1
<PAGE>
Pacific Select Exec
The following indicates the Accumulated Values and Cash Surrender Values as
of December 31, 1999, assuming a hypothetical policy was purchased (1) on the
date each Variable Account began operations, and (2) on January 4, 1999, if
later. Also assumed is that 100% of each net premium payment was allocated to
such Variable Account and reductions of cost of insurance rates are based on
those in effect as of December 31, 1999. The Policy is based on an insured
male, nonsmoker, age 40, annual premium payments of $10,000 (also Guideline
Annual Premium), and a Level and Initial Death Benefit of $560,323:
<TABLE>
<CAPTION>
Variable Accounts
------------------------------------------------------------------------
Aggressive Emerging Bond and Multi-
Equity Markets Growth Income Equity Strategy
4/8/96* 4/8/96* 2/1/89* 1/10/97* 1/10/97* 1/3/89*
------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $46,305.51 $35,996.38 $276,099.75 $24,944.90 $42,902.17 $184,578.08
CSV***................. 42,087.74 31,778.61 276,099.75 20,727.13 38,684.39 184,578.08
(2) Policy Purchased On 1/4/99
AV**................... 10,505.56 12,355.48 12,185.10 7,476.46 11,374.05 8,694.90
CSV***................. 6,287.78 8,137.71 7,967.32 3,258.69 7,156.27 4,477.13
Equity Growth Mid-Cap Equity Small-Cap
Income LT Value Index Index REIT
1/3/89* 1/4/94* 1/8/99* 1/31/91* 1/8/99* 1/19/99*
------------------------------------------------------------------------
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $243,899.73 $196,192.94 $8,379.59 $207,716.79 $9,510.22 $8,095.73
CSV***................. 243,899.73 192,818.72 4,161.82 206,873.23 5,292.44 3,877.95
(2) Policy Purchased On 1/4/99
AV**................... 9,228.75 16,417.02 * 9,865.55 * *
CSV***................. 5,010.98 12,199.25 * 5,647.77 * *
Inter- Government Managed Money High Yield Large-Cap
national Securities Bond Market Bond Value
1/19/89* 2/15/89* 2/1/89* 11/22/88* 1/3/89* 1/8/99*
------------------------------------------------------------------------
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $166,513.77 $125,862.07 $130,205.19 $122,500.44 $150,319.59 $8,861.41
CSV***................. 166,513.77 125,862.07 130,205.19 122,500.44 150,319.59 4,643.64
(2) Policy Purchased On 1/4/99
AV**................... 9,748.65 7,916.36 7,924.74 8,509.89 8,322.90 *
CSV***................. 5,530.88 3,698.59 3,706.97 4,292.11 4,105.13 *
Variable Variable Variable Variable
Account I Account II Account III Account IV
10/11/96* 10/17/96* 10/11/96* 11/18/96*
------------------------------------------------------------
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $51,481.94 $61,606.49 $52,870.44 $50,235.58
CSV***................. 47,264.16 57,388.71 48,652.66 46,017.81
(2) Policy Purchased On 1/4/99
AV**................... 11,923.50 11,529.45 11,789.91 10,316.43
CSV***................. 7,705.72 7,311.67 7,572.14 6,098.65
</TABLE>
- -------------------
* Date Variable Account began operations.
** Accumulated Value: Includes deductions for all policy charges, including
cost of insurance, except surrender charges. Cost of insurance rates vary
depending on age, sex, smoking status, substandard rating, and face
amount.
*** Cash Surrender Value: Includes deductions for all policy charges,
including any underwriting and sales surrender charges that would have
been deducted if the policy had been surrendered on December 31, 1999.
Surrender charges vary by policy.
G-2
<PAGE>
Pacific Select Choice
The following indicates the Accumulated Values and Cash Surrender Values as
of December 31, 1999, assuming a hypothetical policy was purchased (1) on the
date each Variable Account began operations, and (2) on January 4, 1999, if
later. Also assumed is that 100% of each net premium payment was allocated to
such Variable Account and reductions of cost of insurance rates are based on
those in effect as of December 31, 1999. The Policy is based on an insured
male, nonsmoker, age 40, annual premium payments of $10,000 (also Guideline
Annual Premium), and a Level and Initial Death Benefit of $559,456:
<TABLE>
<CAPTION>
Variable Accounts
------------------------------------------------------------------------
Aggressive Emerging Bond and Multi-
Equity Markets Growth Income Equity Strategy
4/8/96* 4/8/96* 2/1/89* 1/10/97* 1/10/97* 1/3/89*
------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $35,937.23 $28,720.11 $241,116.43 $17,850.72 $30,800.90 $163,194.67
CSV***................. 33,979.13 26,762.02 241,116.43 15,892.63 28,842.81 163,194.67
(2) Policy Purchased On 1/4/99
AV**................... 7,018.21 8,339.62 8,172.28 4,877.14 7,631.09 5,761.08
CSV***................. 5,060.12 6,381.53 6,214.19 2,919.05 5,673.00 3,802.98
Equity Growth Mid-Cap Equity Small-Cap
Income LT Value Index Index REIT
1/3/89* 1/4/94* 1/8/99* 1/31/91* 1/8/99* 1/19/99*
------------------------------------------------------------------------
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $214,616.70 $159,237.20 $5,529.95 $178,341.94 $6,271.19 $5,344.51
CSV***................. 214,616.70 157,638.09 3,571.85 177,917.69 4,313.10 3,386.42
(2) Policy Purchased On 1/4/99
AV**................... 6,146.60 11,253.56 * 6,584.48 * *
CSV***................. 4,188.51 9,295.47 * 4,626.38 * *
Inter- Government Managed Money High Yield Large-Cap
national Securities Bond Market Bond Value
1/19/89* 2/15/89* 2/1/89* 11/22/88* 1/3/89* 1/8/99*
------------------------------------------------------------------------
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $149,853.32 $111,828.06 $115,437.31 $111,391.68 $132,300.50 $5,888.37
CSV***................. 149,853.32 111,828.06 115,437.31 111,391.68 132,300.50 3,930.28
(2) Policy Purchased On 1/4/99
AV**................... 6,444.68 5,193.51 5,199.67 5,626.92 5,491.06 *
CSV***................. 4,486.58 3,235.41 3,241.58 3,668.82 3,532.96 *
Variable Variable Variable Variable
Account I Account II Account III Account IV
10/11/96* 10/17/96* 10/11/96* 11/18/96*
------------------------------------------------------------
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $40,196.44 $47,724.24 $41,632.28 $38,772.92
CSV***................. 38,238.35 45,766.14 39,674.19 36,814.83
(2) Policy Purchased On 1/4/99
AV**................... 8,041.71 7,739.43 7,912.73 6,899.61
CSV***................. 6,083.61 5,781.33 5,954.64 4,941.51
</TABLE>
- -------------------
* Date Variable Account began operations.
** Accumulated Value: Includes deductions for all policy charges, including
cost of insurance, except surrender charges. Cost of insurance rates vary
depending on age, sex, smoking status, and substandard rating.
*** Cash Surrender Value: Includes deductions for all policy charges,
including any underwriting and sales surrender charges that would have
been deducted if the policy had been surrendered on December 31, 1999.
Surrender charges vary by policy.
G-3
<PAGE>
Pacific Select Estate Preserver
The following indicates the Accumulated Values and Cash Surrender Values as
of December 31, 1999, assuming a hypothetical policy was purchased (1) on the
date each Variable Account began operations, and (2) on January 4, 1999, if
later. Also assumed is that 100% of each net premium payment was allocated to
such Variable Account and reductions of cost of insurance rates are based on
those in effect as of December 31, 1999. The Policy is based on joint
insureds, one male and one female, select nonsmokers, both age 40, annual
premium payments of $10,000 (also Guideline Annual Premium), and a Level and
Initial Death Benefit of $954,483:
<TABLE>
<CAPTION>
Variable Accounts
------------------------------------------------------------------------
Aggressive Emerging Bond and Multi-
Equity Markets Growth Income Equity Strategy
4/8/96* 4/8/96* 2/1/89* 1/10/97* 1/10/97* 1/3/89*
------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $46,619.87 $36,449.17 $286,353.05 $25,062.86 $42,927.10 $192,065.20
CSV***................. 43,181.41 33,010.71 286,353.05 21,211.79 39,076.02 192,065.20
(2) Policy Purchased On 1/4/99
AV**................... 10,431.17 12,254.65 12,093.78 7,441.77 11,288.42 8,640.71
CSV***................. 5,479.79 7,303.27 7,142.39 2,490.39 6,337.04 3,689.33
Equity Growth Mid-Cap Equity Small-Cap
Income LT Value Index Index REIT
1/3/89* 1/4/94* 1/8/99* 1/31/91* 1/8/99* 1/19/99*
------------------------------------------------------------------------
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $252,990.54 $199,134.27 $8,330.83 $214,053.18 $9,455.59 $8,048.32
CSV***................. 252,990.54 196,933.66 3,379.45 213,503.02 4,504.21 3,096.94
(2) Policy Purchased On 1/4/99
AV**................... 9,166.29 16,256.29 * 9,796.64 * *
CSV***................. 4,214.91 11,304.91 * 4,845.26 * *
Inter- Government Managed Money High Yield Large-Cap
national Securities Bond Market Bond Value
1/19/89* 2/15/89* 2/1/89* 11/22/88* 1/3/89* 1/8/99*
------------------------------------------------------------------------
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $173,966.81 $131,522.84 $135,967.58 $128,119.20 $156,530.20 $8,803.55
CSV***................. 173,966.81 131,522.84 135,967.58 128,119.20 156,530.20 3,852.17
(2) Policy Purchased On 1/4/99
AV**................... 9,690.11 7,875.05 7,883.29 8,458.64 8,274.69 *
CSV***................. 4,738.73 2,923.67 2,931.91 3,507.26 3,323.31 *
Variable Variable Variable Variable
Account I Account II Account III Account IV
10/11/96* 10/17/96* 10/11/96* 11/18/96*
------------------------------------------------------------
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $51,425.94 $61,439.07 $52,784.16 $50,100.95
CSV***................. 47,712.40 57,725.54 49,070.62 46,341.57
(2) Policy Purchased On 1/4/99
AV**................... 11,827.18 11,442.02 11,700.71 10,242.16
CSV***................. 6,875.80 6,490.64 6,749.33 5,290.78
</TABLE>
- -------------------
* Date Variable Account began operations.
** Accumulated Value: Includes deductions for all policy charges, including
cost of insurance, except surrender charges. Cost of insurance rates vary
depending on age, sex, smoking status, and substandard rating.
*** Cash Surrender Value: Includes deductions for all policy charges,
including any underwriting and sales surrender charges that would have
been deducted if the policy had been surrendered on December 31, 1999.
Surrender charges vary by policy.
G-4
<PAGE>
Pacific Select Estate Preserver II
The following indicates the Accumulated Values and Cash Surrender Values as
of December 31, 1999, assuming a hypothetical policy was purchased (1) on the
date each Variable Account began operations, and (2) on January 4, 1999, if
later. Also assumed is that 100% of each net premium payment was allocated to
such Variable Account and reductions of cost of insurance rates are based on
those in effect as of December 31, 1999. The Policy is based on joint
insureds, one male and one female, select nonsmokers, both age 40, annual
premium payments of $10,000 (also Guideline Annual Premium), and a Level and
Initial Death Benefit of $944,039:
<TABLE>
<CAPTION>
Variable Accounts
-------------------------------------------------------------------------
Aggressive Emerging Bond and Multi-
Equity Markets Growth Income Equity Strategy
4/8/96* 4/8/96* 2/1/89* 1/10/97* 1/10/97* 1/3/89*
-------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $46,097.36 $36,039.78 $283,159.92 $24,781.38 $42,446.08 $189,924.73
CSV***................. 46,097.36 36,039.78 283,159.92 24,781.38 42,446.08 189,924.73
(2) Policy Purchased On 1/4/99
AV**................... 10,314.19 12,117.41 11,958.22 7,358.06 11,161.90 8,543.71
CSV***................. 10,314.19 12,117.41 11,958.22 7,358.06 11,161.90 8,543.71
Equity Growth Mid-Cap Equity Small-Cap
Income LT Value Index Index REIT
1/3/89* 1/4/94* 1/8/99* 1/31/91* 1/8/99* 1/19/99*
-------------------------------------------------------------------------
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $250,170.22 $196,905.18 $8,237.26 $211,660.78 $9,349.37 $7,957.92
CSV***................. 250,170.22 196,905.18 8,237.26 211,660.78 9,349.37 7,957.92
(2) Policy Purchased On 1/4/99
AV**................... 9,063.46 16,074.61 * 9,686.76 * *
CSV***................. 9,063.46 16,074.61 * 9,686.76 * *
Inter- Government Managed Money High Yield Large-Cap
national Securities Bond Market Bond Value
1/19/89* 2/15/89* 2/1/89* 11/22/88* 1/3/89* 1/8/99*
-------------------------------------------------------------------------
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $172,028.74 $130,057.93 $134,452.87 $126,696.67 $154,785.52 $8,704.75
CSV***................. 172,028.74 130,057.93 134,452.87 126,696.67 154,785.52 8,704.75
(2) Policy Purchased On 1/4/99
AV**................... 9,581.29 7,786.53 7,794.68 8,363.66 8,181.74 *
CSV***................. 9,581.29 7,786.53 7,794.68 8,363.66 8,181.74 *
Variable Variable Variable Variable
Account I Account II Account III Account IV
10/11/96* 10/17/96* 10/11/96* 11/18/96*
------------------------------------------------------------
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $50,851.19 $60,752.99 $52,194.67 $49,541.41
CSV***................. 50,851.19 60,752.99 52,194.67 49,541.41
(2) Policy Purchased On 1/4/99
AV**................... 11,694.72 11,313.79 11,569.58 10,127.32
CSV***................. 11,694.72 11,313.79 11,569.58 10,127.32
</TABLE>
- -------------------
* Date Variable Account began operations.
** Accumulated Value: Includes deductions for all policy charges, including
cost of insurance, except surrender charges. Cost of insurance rates vary
depending on age, sex, smoking status, and substandard rating.
*** Cash Surrender Value: Includes deductions for all policy charges,
including any underwriting and sales surrender charges that would have
been deducted if the policy had been surrendered on December 31, 1999.
Surrender charges vary by policy.
G-5
<PAGE>
Pacific Select Estate Maximizer (Single Insured)
The following indicates the Accumulated Values and Cash Surrender Values as
of December 31, 1999, assuming a hypothetical policy was purchased (1) on the
date each Variable Account began operations, and (2) on January 4, 1999, if
later. Also assumed is that 100% of each net premium payment was allocated to
such Variable Account and reductions of cost of insurance rates are based on
those in effect as of December 31, 1999. The Policy is based on an insured
male, nonsmoker, age 40, single premium payment of $40,000 (also Guideline
Single Premium), and a Level and Initial Death Benefit of $159,779:
<TABLE>
<CAPTION>
Variable Accounts
-----------------------------------------------------------------------
Aggressive Emerging Bond and Multi-
Equity Markets Growth Income Equity Strategy
4/8/96* 4/8/96* 2/1/89* 1/10/97* 1/10/97* 1/3/89*
-----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $59,895.02 $39,986.23 $183,751.97 $45,030.89 $77,702.47 $117,517.13
CSV***................. 56,695.02 36,786.23 183,751.97 41,430.89 74,102.47 117,517.13
(2) Policy Purchased On 1/4/99
AV**................... 50,326.91 58,729.11 58,200.30 36,447.16 54,311.76 41,908.28
CSV***................. 46,326.91 54,729.11 54,200.30 32,447.16 50,311.76 37,908.28
Equity Growth Mid-Cap Equity Small-Cap
Income LT Value Index Index REIT
1/3/89* 1/4/94* 1/8/99* 1/31/91* 1/8/99* 1/19/99*
-----------------------------------------------------------------------
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $163,799.56 $223,722.16 $40,507.89 $168,768.87 $45,999.55 $39,125.43
CSV***................. 163,799.56 221,322.16 36,507.89 167,568.87 41,999.55 35,125.43
(2) Policy Purchased On 1/4/99
AV**................... 44,310.47 77,110.04 * 47,294.08 * *
CSV***................. 40,310.47 73,110.04 * 43,294.08 * *
Inter- Government Managed Money High Yield Large-Cap
national Securities Bond Market Bond Value
1/19/89* 2/15/89* 2/1/89* 11/22/88* 1/3/89* 1/8/99*
-----------------------------------------------------------------------
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $85,502.36 $74,419.92 $77,925.93 $56,325.24 $89,103.60 $42,619.67
CSV***................. 85,502.36 74,419.92 77,925.93 56,325.24 89,103.60 38,619.67
(2) Policy Purchased On 1/4/99
AV**................... 47,065.40 38,433.64 38,470.77 41,078.69 40,241.73 *
CSV***................. 43,065.40 34,433.64 34,470.77 37,078.69 36,241.73 *
Variable Variable Variable Variable
Account I Account II Account III Account IV
10/11/96* 10/17/96* 10/11/96* 11/18/96*
------------------------------------------------------------
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $65,550.03 $91,991.16 $69,875.87 $77,167.80
CSV***................. 62,350.03 88,791.16 66,675.87 73,967.80
(2) Policy Purchased On 1/4/99
AV**................... 56,709.83 55,031.95 56,283.33 49,379.23
CSV***................. 52,709.83 51,031.95 52,283.33 45,379.23
</TABLE>
- -------------------
* Date Variable Account began operations.
** Accumulated Value: Includes deductions for all policy charges, including
cost of insurance, except surrender charges. Cost of insurance rates vary
depending on age and smoking status.
*** Cash Surrender Value: Includes deductions for all policy charges,
including any underwriting and sales surrender charges that would have
been deducted if the policy had been surrendered on December 31, 1999.
Surrender charges vary by policy.
G-6
<PAGE>
Pacific Select Estate Maximizer (Joint Insureds)
The following indicates the Accumulated Values and Cash Surrender Values as
of December 31, 1999, assuming a hypothetical policy was purchased (1) on the
date each Variable Account began operations, and (2) on January 4, 1999, if
later. Also assumed is that 100% of each net premium payment was allocated to
such Variable Account and reductions of cost of insurance rates are based on
those in effect as of December 31, 1999. The Policy is based on joint
insureds, one male and one female, nonsmokers, both age 40, single premium
payment of $10,000 (also Guideline Single Premium), and a Level and Initial
Death Benefit of $271,147:
<TABLE>
<CAPTION>
Variable Accounts
-----------------------------------------------------------------------
Aggressive Emerging Bond and Multi-
Equity Markets Growth Income Equity Strategy
4/8/96* 4/8/96* 2/1/89* 1/10/97* 1/10/97* 1/3/89*
-----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $61,039.88 $40,703.86 $193,002.70 $45,694.84 $78,853.88 $123,356.77
CSV***................. 57,839.88 37,503.86 193,002.70 42,094.84 75,253.88 123,356.77
(2) Policy Purchased On 1/4/99
AV**................... 50,577.43 59,021.62 58,490.08 36,628.36 54,582.18 42,116.80
CSV***................. 46,577.43 55,021.62 54,490.08 32,628.36 50,582.18 38,116.80
Equity Growth Mid-Cap Equity Small-Cap
Income LT Value Index Index REIT
1/3/89* 1/4/94* 1/8/99* 1/31/91* 1/8/99* 1/19/99*
-----------------------------------------------------------------------
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $172,078.55 $230,333.39 $40,709.40 $176,078.85 $46,228.37 $39,320.06
CSV***................. 172,078.55 227,933.39 36,709.40 174,878.85 42,228.37 35,320.06
(2) Policy Purchased On 1/4/99
AV**................... 44,531.01 77,492.58 * 47,529.49 * *
CSV***................. 40,531.01 73,492.58 * 43,529.49 * *
Inter- Government Managed Money High Yield Large-Cap
national Securities Bond Market Bond Value
1/19/89* 2/15/89* 2/1/89* 11/22/88* 1/3/89* 1/8/99*
-----------------------------------------------------------------------
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $89,683.80 $77,987.62 $81,682.29 $58,945.97 $93,475.94 $42,831.76
CSV***................. 89,683.80 77,987.62 81,682.29 58,945.97 93,475.94 38,831.76
(2) Policy Purchased On 1/4/99
AV**................... 47,299.56 38,624.77 38,662.08 41,283.06 40,441.91 *
CSV***................. 43,299.56 34,624.77 34,662.08 37,283.06 36,441.91 *
Variable Variable Variable Variable
Account I Account II Account III Account IV
10/11/96* 10/17/96* 10/11/96* 11/18/96*
------------------------------------------------------------
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $66,594.49 $93,469.07 $70,991.74 $78,438.31
CSV***................. 63,394.49 90,269.07 67,791.74 75,238.31
(2) Policy Purchased On 1/4/99
AV**................... 56,992.28 55,305.97 56,563.57 49,625.05
CSV***................. 52,992.28 51,305.97 52,563.57 45,625.05
</TABLE>
- -------------------
* Date Variable Account began operations.
** Accumulated Value: Includes deductions for all policy charges, including
cost of insurance, except surrender charges. Cost of insurance rates vary
depending on age and smoking status.
*** Cash Surrender Value: Includes deductions for all policy charges,
including any underwriting and sales surrender charges that would have
been deducted if the policy had been surrendered on December 31, 1999.
Surrender charges vary by policy.
G-7
<PAGE>
Pacific Select Exec II
The following indicates the Accumulated Values and Cash Surrender Values as
of December 31, 1999, assuming a hypothetical policy was purchased (1) on the
date each Variable Account began operations, and (2) on January 4, 1999, if
later. Also assumed is that 100% of each net premium payment was allocated to
such Variable Account and reductions of cost of insurance rates are based on
those in effect as of December 31, 1999. The Policy is based on an insured
male, select nonsmoker, age 40, annual premium payments of $10,000 (also
Guideline Annual Premium), and a Level and Initial Death Benefit of $554,056:
<TABLE>
<CAPTION>
Variable Accounts
-------------------------------------------------------------------------
Aggressive Emerging Bond and Multi-
Equity Markets Growth Income Equity Strategy
4/8/96* 4/8/96* 2/1/89* 1/10/97* 1/10/97* 1/3/89*
-------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $42,144.12 $32,425.97 $258,317.70 $22,382.28 $38,958.04 $172,708.50
CSV***................. 37,203.05 27,484.90 258,317.70 17,441.21 34,016.97 172,708.50
(2) Policy Purchased On 1/4/99
AV**................... 9,465.61 11,211.89 11,008.65 6,627.22 10,278.50 7,790.04
CSV***................. 4,524.54 6,270.82 6,067.57 1,686.15 5,337.42 2,848.96
Equity Growth Mid-Cap Equity Small-Cap
Income LT Value Index Index REIT
1/3/89* 1/4/94* 1/8/99* 1/31/91* 1/8/99* 1/19/99*
-------------------------------------------------------------------------
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $228,374.64 $180,792.54 $7,486.91 $192,695.97 $8,492.53 $7,235.05
CSV***................. 228,374.64 176,094.14 2,545.84 191,521.37 3,551.45 2,293.98
(2) Policy Purchased On 1/4/99
AV**................... 8,297.88 15,057.79 * 8,883.22 * *
CSV***................. 3,356.81 10,116.72 * 3,942.15 * *
Inter- Government Managed Money High Yield Large-Cap
national Securities Bond Market Bond Value
1/19/89* 2/15/89* 2/1/89* 11/22/88* 1/3/89* 1/8/99*
-------------------------------------------------------------------------
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $155,664.35 $117,682.93 $121,734.71 $115,048.87 $140,763.34 $7,954.98
CSV***................. 155,664.35 117,682.93 121,734.71 115,048.87 140,763.34 3,013.91
(2) Policy Purchased On 1/4/99
AV**................... 8,720.54 7,044.47 7,052.54 7,613.52 7,434.88 *
CSV***................. 3,779.47 2,103.39 2,111.47 2,672.45 2,493.81 *
</TABLE>
- -------------------
* Date Variable Account began operations.
** Accumulated Value: Includes deductions for all policy charges, including
cost of insurance, except surrender charges. Cost of insurance rates vary
depending on age, sex, smoking status, and substandard rating.
*** Cash Surrender Value: Includes deductions for all policy charges,
including any underwriting and sales surrender charges that that would
have been deducted if the policy had been surrendered on December 31,
1999. Surrender charges vary by policy.
G-8
<PAGE>
M's Versatile Product
The following indicates the Accumulated Values and Cash Surrender Values as
of December 31, 1999, assuming a hypothetical policy was purchased (1) on the
date each Variable Account began operations, and (2) on January 4, 1999, if
later. Also assumed is that 100% of each net premium payment was allocated to
such Variable Account and reductions of cost of insurance rates are based on
those in effect as of December 31, 1999. The Policy is based on an insured
male, select nonsmoker, age 40, annual premium payments of $10,000 (also
Guideline Annual Premium), and a Level and Initial Death Benefit of $526,629:
<TABLE>
<CAPTION>
Variable Accounts
-------------------------------------------------------------------------
Aggressive Emerging Bond and Multi-
Equity Markets Growth Income Equity Strategy
4/8/96* 4/8/96* 2/1/89* 1/10/97* 1/10/97* 1/3/89*
-------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $42,211.49 $32,533.85 $259,150.56 $22,443.15 $39,000.47 $173,336.01
CSV***................. 41,710.31 32,032.67 259,150.56 21,881.82 38,439.14 173,336.01
(2) Policy Purchased On 1/4/99
AV**................... 9,475.49 11,214.24 11,016.63 6,646.98 10,285.65 7,803.36
CSV***................. 8,753.79 10,492.53 10,294.93 5,925.28 9,563.94 7,081.66
Equity Growth Mid-Cap Equity Small-Cap
Income LT Value Index Index REIT
1/3/89* 1/4/94* 1/08/99* 1/31/91* 1/8/99* 1/19/99*
-------------------------------------------------------------------------
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $229,095.12 $181,065.06 $7,502.16 $193,237.19 $8,510.36 $7,249.57
CSV***................. 229,095.12 180,744.30 6,780.46 193,157.00 7,788.66 6,527.87
(2) Policy Purchased On 1/4/99
AV**................... 8,308.58 15,042.21 * 8,893.16 * *
CSV***................. 7,586.87 14,320.51 * 8,171.46 * *
Inter- Government Managed Money High Yield Large-Cap
national Securities Bond Market Bond Value
1/19/89* 2/15/89* 2/1/89* 11/22/88* 1/3/89* 1/8/99*
-------------------------------------------------------------------------
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $156,321.17 $118,180.95 $122,241.12 $115,491.63 $141,288.56 $7,966.72
CSV***................. 156,321.17 118,180.95 122,241.12 115,491.63 141,288.56 7,245.02
(2) Policy Purchased On 1/4/99
AV**................... 8,737.06 7,062.20 7,070.22 7,627.82 7,450.19 *
CSV***................. 8,015.36 6,340.50 6,348.52 6,906.11 6,728.49 *
Variable Variable Variable Variable
Account I Account II Account III Account IV
10/11/96* 10/17/96* 10/11/96* 11/18/96*
------------------------------------------------------------
(1) Policy Purchased On Date Variable Account Began Operations
AV**................... $47,374.09 $56,917.15 $48,828.84 $46,369.28
CSV***................. 46,832.81 56,375.88 48,287.56 45,821.32
(2) Policy Purchased On
1/4/99
AV**................... 10,816.95 10,429.52 10,663.86 9,311.26
CSV***................. 10,095.25 9,707.82 9,942.15 8,589.55
</TABLE>
- -------------------
* Date Variable Account began operations.
** Accumulated Value: Includes deductions for all policy charges, including
cost of insurance, except surrender charges. Cost of insurance rates vary
depending on age, sex, smoking status, and substandard rating.
*** Cash Surrender Value: Includes deductions for all policy charges,
including any underwriting and sales surrender charges that would have
been deducted if the policy had been surrendered on December 31, 1999.
Surrender charges vary by policy.
G-9
<PAGE>
INDEPENDENT AUDITORS' REPORT
The Board of Directors Pacific Life Insurance Company:
We have audited the accompanying statement of assets and liabilities of
Pacific Select Exec Separate Account (comprised of the Aggressive Equity,
Emerging Markets, Growth, Bond and Income, Equity, Multi-Strategy, Equity
Income, Growth LT, Mid-Cap Value, Equity Index, Small-Cap Index, REIT,
International, Government Securities, Managed Bond, Money Market, High Yield
Bond, Large-Cap Value, Variable Account I, Variable Account II, Variable
Account III, and Variable Account IV Variable Accounts) as of December 31,
1999 and the related statement of operations for the year then ended and
statement of changes in net assets for each of the two years in the period
then ended (as to the Mid-Cap Value, Small-Cap Index, REIT, and Large-Cap
Value Variable Accounts, for the periods from commencement of operations
through December 31, 1999). These financial statements are the responsibility
of the Separate Account's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, such financial statements present fairly, in all material
respects, the financial position of each of the respective Variable Accounts
constituting Pacific Select Exec Separate Account as of December 31, 1999 and
the results of their operations for the year then ended and the changes in
their net assets for each of the two years in the period then ended (as to the
Mid-Cap Value, Small-Cap Index, REIT, and Large-Cap Value Variable Accounts,
for the periods from commencement of operations through December 31, 1999), in
conformity with generally accepted accounting principles.
DELOITTE & TOUCHE LLP
Costa Mesa, California
February 10, 2000
H-1
<PAGE>
PACIFIC SELECT EXEC SEPARATE ACCOUNT
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
(In thousands)
<TABLE>
<CAPTION>
Aggressive Emerging Bond and Multi- Equity Growth Mid-Cap Equity Small-Cap
Equity Markets Growth Income Equity Strategy Income LT Value Index Index
Variable Variable Variable Variable Variable Variable Variable Variable Variable Variable Variable
Account Account Account Account Account Account Account Account Account Account Account
--------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Investments:
Aggressive
Equity Portfolio
(2,270 shares;
cost $28,345)... $33,035
Emerging Markets
Portfolio
(1,900 shares;
cost $14,846)... $19,910
Growth Portfolio
(9,705 shares;
cost $225,194).. $289,069
Bond and Income
Portfolio
(630 shares;
cost $7,935).... $6,997
Equity Portfolio
(1,589 shares;
cost $48,734)... $59,599
Multi-Strategy
Portfolio
(8,946 shares;
cost $134,934).. $151,897
Equity Income
Portfolio
(8,125 shares;
cost $186,348).. $225,466
Growth LT
Portfolio
(11,253 shares;
cost $266,532).. $536,446
Mid-Cap Value
Portfolio
(496 shares;
cost $5,142).... $5,208
Equity Index
Portfolio
(11,315 shares;
cost $298,365).. $434,565
Small-Cap Index
Portfolio
(547 shares;
cost $5,759).... $6,426
Receivables:
Due from Pacific
Life Insurance
Company......... 45 27 53 5 19 131 4 1
Fund shares
redeemed........ 26 88
--------------------------------------------------------------------------------------------------
Total Assets..... 33,061 19,955 289,096 6,997 59,652 151,902 225,485 536,577 5,212 434,653 6,427
--------------------------------------------------------------------------------------------------
LIABILITIES
Payables:
Due to Pacific
Life Insurance
Company......... 26 88
Fund shares
purchased....... 45 27 53 5 19 131 4 1
--------------------------------------------------------------------------------------------------
Total
Liabilities...... 26 45 27 53 5 19 131 4 88 1
--------------------------------------------------------------------------------------------------
NET ASSETS....... $33,035 $19,910 $289,069 $6,997 $59,599 $151,897 $225,466 $536,446 $5,208 $434,565 $6,426
--------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements
H-2
<PAGE>
PACIFIC SELECT EXEC SEPARATE ACCOUNT
STATEMENT OF ASSETS AND LIABILITIES (Continued)
DECEMBER 31, 1999
(In thousands)
<TABLE>
<CAPTION>
Govern- High
Inter- ment Managed Money Yield Large-Cap
REIT national Securities Bond Market Bond Value Variable Variable Variable Variable
Variable Variable Variable Variable Variable Variable Variable Account Account Account Account
Account Account Account Account Account Account Account I II III IV
--------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Investments:
REIT Portfolio
(276 shares;
cost $2,783).... $2,643
International
Portfolio
(11,651 shares;
cost $188,119).. $215,349
Government
Securities
Portfolio
(2,200 shares;
cost $23,386)... $22,218
Managed Bond
Portfolio
(11,058 shares;
cost $120,723).. $114,197
Money Market
Portfolio
(13,001 shares;
cost $131,293).. $131,046
High Yield Bond
Portfolio
(5,450 shares;
cost $50,328)... $48,032
Large-Cap Value
Portfolio
(485 shares;
cost $5,320).... $5,378
Brandes
International
Equity Portfolio
(640 shares;
cost $8,485).... $9,927
Turner Core
Growth Portfolio
(943 shares;
cost $19,237)... $21,622
Frontier Capital
Appreciation
Portfolio
(401 shares;
cost $6,298).... $8,463
Enhanced U.S.
Equity Portfolio
(286 shares;
cost $5,315).... $6,005
Receivables:
Due from Pacific
Life Insurance
Company......... 4 74 3 2 7
Fund shares
redeemed........ 3 209 11
---------------------------------------------------------------------------------------------------
Total Assets..... 2,647 215,423 22,221 114,200 131,255 48,043 5,380 9,927 21,622 8,463 6,012
---------------------------------------------------------------------------------------------------
LIABILITIES
Payables:
Due to Pacific
Life Insurance
Company......... 3 209 11
Fund shares
purchased....... 4 74 3 2 7
---------------------------------------------------------------------------------------------------
Total
Liabilities...... 4 74 3 3 209 11 2 7
---------------------------------------------------------------------------------------------------
NET ASSETS....... $2,643 $215,349 $22,218 $114,197 $131,046 $48,032 $5,378 $9,927 $21,622 $8,463 $6,005
---------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements
H-3
<PAGE>
PACIFIC SELECT EXEC SEPARATE ACCOUNT
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1999
(In thousands)
<TABLE>
<CAPTION>
Aggressive Emerging Bond and Multi- Equity Growth Mid-Cap Equity Small-Cap
Equity Markets Growth Income Equity Strategy Income LT Value Index Index
Variable Variable Variable Variable Variable Variable Variable Variable Variable Variable Variable
Account Account Account Account Account Account Account Account Account (1) Account Account (1)
-----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME
Dividends....... $2,297 $60 $24,357 $647 $2,430 $12,175 $18,449 $24,658 $10 $5,600 $95
-----------------------------------------------------------------------------------------------------------
Net Investment
Income........... 2,297 60 24,357 647 2,430 12,175 18,449 24,658 10 5,600 95
-----------------------------------------------------------------------------------------------------------
NET REALIZED AND
UNREALIZED GAIN
(LOSS) ON
INVESTMENTS
Net realized
gain (loss) from
security
transactions.... 835 (293) 17,437 (147) 1,715 1,903 8,208 25,696 (70) 16,677 37
Net unrealized
appreciation
(depreciation)
on investments.. 3,261 6,681 51,373 (970) 8,860 (4,391) (1,356) 195,153 66 45,834 667
-----------------------------------------------------------------------------------------------------------
Net Realized and
Unrealized Gain
(Loss) on
Investments...... 4,096 6,388 68,810 (1,117) 10,575 (2,488) 6,852 220,849 (4) 62,511 704
-----------------------------------------------------------------------------------------------------------
NET INCREASE
(DECREASE) IN NET
ASSETS
RESULTING FROM
OPERATIONS...... $6,393 $6,448 $93,167 ($470) $13,005 $9,687 $25,301 $245,507 $6 $68,111 $799
-----------------------------------------------------------------------------------------------------------
</TABLE>
(1) Operations commenced during 1999 (see Note 1 to Financial Statements).
See Notes to Financial Statements
H-4
<PAGE>
PACIFIC SELECT EXEC SEPARATE ACCOUNT
STATEMENT OF OPERATIONS (Continued)
FOR THE YEAR ENDED DECEMBER 31, 1999
(In thousands)
<TABLE>
<CAPTION>
Govern- High
Inter- ment Managed Money Yield Large-Cap
REIT national Securities Bond Market Bond Value Variable Variable Variable Variable
Variable Variable Variable Variable Variable Variable Variable Account Account Account Account
Account (1) Account Account Account Account Account Account (1) I II III IV
----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME
Dividends....... $82 $7,401 $1,278 $8,539 $4,600 $3,845 $20 $312 $1,181 $243 $474
----------------------------------------------------------------------------------------------------------
Net Investment
Income........... 82 7,401 1,278 8,539 4,600 3,845 20 312 1,181 243 474
----------------------------------------------------------------------------------------------------------
NET REALIZED AND
UNREALIZED GAIN
(LOSS) ON
INVESTMENTS
Net realized
gain (loss) from
security
transactions.... (15) 8,072 9 353 259 (1,968) 29 254 277 224 646
Net unrealized
appreciation
(depreciation)
on investments.. (140) 23,374 (1,640) (10,865) (137) (533) 58 1,374 1,904 1,903 141
----------------------------------------------------------------------------------------------------------
Net Realized and
Unrealized Gain
(Loss) on
Investments...... (155) 31,446 (1,631) (10,512) 122 (2,501) 87 1,628 2,181 2,127 787
----------------------------------------------------------------------------------------------------------
NET INCREASE
(DECREASE) IN NET
ASSETS
RESULTING FROM
OPERATIONS...... ($73) $38,847 ($353) ($1,973) $4,722 $1,344 $107 $1,940 $3,362 $2,370 $1,261
-----------------------------------------------------------------------------------------------------------
</TABLE>
(1) Operations commenced during 1999 (see Note 1 to Financial Statements).
See Notes to Financial Statements
H-5
<PAGE>
PACIFIC SELECT EXEC SEPARATE ACCOUNT
STATEMENT OF CHANGES IN NET ASSETS
FOR THE YEAR ENDED DECEMBER 31, 1999
(In thousands)
<TABLE>
<CAPTION>
Aggressive Emerging Bond and Multi-
Equity Markets Growth Income Equity Strategy
Variable Variable Variable Variable Variable Variable
Account Account Account Account Account Account
-----------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
Net investment income................................................ $2,297 $60 $24,357 $647 $2,430 $12,175
Net realized gain (loss) from security transactions.................. 835 (293) 17,437 (147) 1,715 1,903
Net unrealized appreciation (depreciation) on investments............ 3,261 6,681 51,373 (970) 8,860 (4,391)
-----------------------------------------------------------
Net Increase (Decrease) in Net Assets Resulting from Operations....... 6,393 6,448 93,167 (470) 13,005 9,687
-----------------------------------------------------------
INCREASE (DECREASE) IN NET ASSETS FROM POLICY TRANSACTIONS
Transfer of net premiums............................................. 6,178 3,315 31,800 1,814 7,890 13,459
Transfers--policy charges and deductions............................. (1,517) (908) (11,435) (439) (2,031) (6,081)
Transfers in (from other variable accounts).......................... 29,901 25,855 227,823 6,748 59,920 23,609
Transfers out (to other variable accounts)........................... (25,109) (24,440) (239,257) (5,539) (36,551) (18,440)
Transfers--other..................................................... (577) (432) (12,699) (399) (700) (4,335)
-----------------------------------------------------------
Net Increase (Decrease) in Net Assets Derived from Policy
Transactions.......................................................... 8,876 3,390 (3,768) 2,185 28,528 8,212
-----------------------------------------------------------
NET INCREASE IN NET ASSETS............................................ 15,269 9,838 89,399 1,715 41,533 17,899
-----------------------------------------------------------
NET ASSETS
Beginning of Year.................................................... 17,766 10,072 199,670 5,282 18,066 133,998
-----------------------------------------------------------
End of Year.......................................................... $33,035 $19,910 $289,069 $6,997 $59,599 $151,897
-----------------------------------------------------------
<CAPTION>
Equity Growth Mid-Cap Equity Small-Cap
Income LT Value Index Index
Variable Variable Variable Variable Variable
Account Account Account (1) Account Account (1)
----------------------------------------------------
<S> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
Net investment income................................................ $18,449 $24,658 $10 $5,600 $95
Net realized gain (loss) from security transactions.................. 8,208 25,696 (70) 16,677 37
Net unrealized appreciation (depreciation) on investments............ (1,356) 195,153 66 45,834 667
----------------------------------------------------
Net Increase (Decrease) in Net Assets Resulting from Operations....... 25,301 245,507 6 68,111 799
----------------------------------------------------
INCREASE (DECREASE) IN NET ASSETS FROM POLICY TRANSACTIONS
Transfer of net premiums............................................. 27,427 46,518 1,020 69,793 1,576
Transfers--policy charges and deductions............................. (10,117) (16,923) (151) (19,242) (168)
Transfers in (from other variable accounts).......................... 71,635 186,813 7,393 156,344 17,438
Transfers out (to other variable accounts)........................... (63,749) (134,957) (2,988) (122,161) (13,186)
Transfers--other..................................................... (12,898) (17,789) (72) (21,467) (33)
----------------------------------------------------
Net Increase (Decrease) in Net Assets Derived from Policy
Transactions.......................................................... 12,298 63,662 5,202 63,267 5,627
----------------------------------------------------
NET INCREASE IN NET ASSETS............................................ 37,599 309,169 5,208 131,378 6,426
----------------------------------------------------
NET ASSETS
Beginning of Year.................................................... 187,867 227,277 303,187
----------------------------------------------------
End of Year.......................................................... $225,466 $536,446 $5,208 $434,565 $6,426
----------------------------------------------------
</TABLE>
(1) Operations commenced during 1999 (see Note 1 to Financial Statements).
See Notes to Financial Statements
H-6
<PAGE>
PACIFIC SELECT EXEC SEPARATE ACCOUNT
STATEMENT OF CHANGES IN NET ASSETS (Continued)
FOR THE YEAR ENDED DECEMBER 31, 1999
(In thousands)
<TABLE>
<CAPTION>
Govern- High
Inter- ment Managed Money Yield Large-Cap
REIT national Securities Bond Market Bond Value Variable Variable Variable Variable
Variable Variable Variable Variable Variable Variable Variable Account Account Account Account
Account (1) Account Account Account Account Account Account (1) I II III IV
---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INCREASE
(DECREASE) IN NET
ASSETS
FROM OPERATIONS
Net investment
income.......... $82 $7,401 $1,278 $8,539 $4,600 $3,845 $20 $312 $1,181 $243 $474
Net realized
gain (loss) from
security
transactions.... (15) 8,072 9 353 259 (1,968) 29 254 277 224 646
Net unrealized
appreciation
(depreciation)
on investments.. (140) 23,374 (1,640) (10,865) (137) (533) 58 1,374 1,904 1,903 141
---------------------------------------------------------------------------------------------------------------
Net Increase
(Decrease) in Net
Assets Resulting
from Operations.. (73) 38,847 (353) (1,973) 4,722 1,344 107 1,940 3,362 2,370 1,261
---------------------------------------------------------------------------------------------------------------
INCREASE
(DECREASE) IN NET
ASSETS
FROM POLICY
TRANSACTIONS
Transfer of net
premiums........ 327 29,734 3,788 15,623 255,115 9,673 915 1,409 1,432 1,411 885
Transfers--
policy charges
and deductions.. (65) (8,874) (1,057) (4,945) (9,879) (2,496) (177) (234) (290) (327) (259)
Transfers in
(from other
variable
accounts)....... 3,247 121,103 12,668 65,597 466,728 44,998 6,201 5,989 17,199 3,714 8,944
Transfers out
(to other
variable
accounts)....... (771) (114,670) (7,771) (59,239) (643,243) (46,917) (1,608) (632) (2,837) (2,450) (9,539)
Transfers--
other........... (22) (7,931) (2,206) (2,730) (11,504) (1,940) (60) (67) (192) (707) (273)
---------------------------------------------------------------------------------------------------------------
Net Increase
(Decrease) in Net
Assets Derived
from Policy
Transactions..... 2,716 19,362 5,422 14,306 57,217 3,318 5,271 6,465 15,312 1,641 (242)
---------------------------------------------------------------------------------------------------------------
NET INCREASE IN
NET ASSETS....... 2,643 58,209 5,069 12,333 61,939 4,662 5,378 8,405 18,674 4,011 1,019
---------------------------------------------------------------------------------------------------------------
NET ASSETS
Beginning of
Year............ 157,140 17,149 101,864 69,107 43,370 1,522 2,948 4,452 4,986
---------------------------------------------------------------------------------------------------------------
End of Year..... $2,643 $215,349 $22,218 $114,197 $131,046 $48,032 $5,378 $9,927 $21,622 $8,463 $6,005
---------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Operations commenced during 1999 (see Note 1 to Financial Statements).
See Notes to Financial Statements
H-7
<PAGE>
PACIFIC SELECT EXEC SEPARATE ACCOUNT
STATEMENT OF CHANGES IN NET ASSETS
FOR THE YEAR ENDED DECEMBER 31, 1998
(In thousands)
<TABLE>
<CAPTION>
Aggressive Emerging Bond and Multi- Equity Growth Equity
Equity Markets Growth Income Equity Strategy Income LT Index
Variable Variable Variable Variable Variable Variable Variable Variable Variable
Account Account Account Account Account Account Account Account Account
---------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN
NET ASSETS
FROM OPERATIONS
Net investment income.. $5 $117 $20,232 $147 $507 $12,030 $18,901 $6,250 $4,853
Net realized gain
(loss) from security
transactions........... 653 (1,951) 10,581 19 369 3,108 5,470 5,163 11,629
Net unrealized
appreciation
(depreciation) on
investments............ 1,132 (935) (23,983) 13 1,989 5,144 9,750 63,381 43,404
---------------------------------------------------------------------------------------
Net Increase (Decrease)
in Net Assets Resulting
from Operations......... 1,790 (2,769) 6,830 179 2,865 20,282 34,121 74,794 59,886
---------------------------------------------------------------------------------------
INCREASE (DECREASE) IN
NET ASSETS
FROM POLICY TRANSACTIONS
Transfer of net
premiums............... 4,086 3,183 31,972 1,056 2,976 14,554 24,939 29,295 44,705
Transfers--policy
charges and deductions. (969) (663) (10,609) (197) (633) (5,260) (7,949) (9,146) (12,955)
Transfers in (from
other variable
accounts).............. 20,958 27,300 89,840 6,550 17,627 13,875 46,109 82,877 108,028
Transfers out (to other
variable accounts)..... (16,962) (25,040) (87,886) (2,820) (8,527) (17,159) (35,074) (53,981) (73,002)
Transfers--other....... (610) (355) (10,466) (171) (432) (5,646) (5,765) (7,000) (10,763)
---------------------------------------------------------------------------------------
Net Increase in Net
Assets Derived
from Policy
Transactions............ 6,503 4,425 12,851 4,418 11,011 364 22,260 42,045 56,013
---------------------------------------------------------------------------------------
NET INCREASE IN NET
ASSETS.................. 8,293 1,656 19,681 4,597 13,876 20,646 56,381 116,839 115,899
---------------------------------------------------------------------------------------
NET ASSETS
Beginning of Year...... 9,473 8,416 179,989 685 4,190 113,352 131,486 110,438 187,288
---------------------------------------------------------------------------------------
End of Year............ $17,766 $10,072 $199,670 $5,282 $18,066 $133,998 $187,867 $227,277 $303,187
---------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements
H-8
<PAGE>
PACIFIC SELECT EXEC SEPARATE ACCOUNT
STATEMENT OF CHANGES IN NET ASSETS (Continued)
FOR THE YEAR ENDED DECEMBER 31, 1998
(In thousands)
<TABLE>
<CAPTION>
Govern- High
Inter- ment Managed Money Yield
national Securities Bond Market Bond Variable Variable Variable Variable
Variable Variable Variable Variable Variable Account Account Account Account
Account Account Account Account Account I II III IV
-------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN
NET ASSETS
FROM OPERATIONS
Net investment income.. $11,985 $881 $5,533 $3,392 $3,403 $87 $52 $21 $154
Net realized gain
(loss) from security
transactions........... 5,435 164 663 (3) (87) 8 96 (64) 183
Net unrealized
appreciation
(depreciation) on
investments............ (10,085) 59 1,408 14 (2,165) 72 460 44 366
-------------------------------------------------------------------------------------
Net Increase in Net
Assets Resulting from
Operations.............. 7,335 1,104 7,604 3,403 1,151 167 608 1 703
-------------------------------------------------------------------------------------
INCREASE (DECREASE) IN
NET ASSETS
FROM POLICY TRANSACTIONS
Transfer of net
premiums............... 28,077 2,186 13,456 164,872 7,612 238 408 1,305 1,358
Transfers--policy
charges and deductions. (8,359) (699) (3,939) (6,168) (2,255) (62) (93) (245) (156)
Transfers in (from
other variable
accounts).............. 71,891 10,097 52,698 268,634 34,691 749 2,159 1,700 1,697
Transfers out (to other
variable accounts)..... (64,225) (5,218) (36,135) (399,943) (29,075) (97) (880) (1,374) (481)
Transfers--other....... (6,520) (742) (4,332) (13,775) (2,461) (12) (37) (44) 111
-------------------------------------------------------------------------------------
Net Increase in Net
Assets Derived
from Policy
Transactions............ 20,864 5,624 21,748 13,620 8,512 816 1,557 1,342 2,529
-------------------------------------------------------------------------------------
NET INCREASE IN NET
ASSETS.................. 28,199 6,728 29,352 17,023 9,663 983 2,165 1,343 3,232
-------------------------------------------------------------------------------------
NET ASSETS
Beginning of Year...... 128,941 10,421 72,512 52,084 33,707 539 783 3,109 1,754
-------------------------------------------------------------------------------------
End of Year............ $157,140 $17,149 $101,864 $69,107 $43,370 $1,522 $2,948 $4,452 $4,986
-------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements
H-9
<PAGE>
PACIFIC SELECT EXEC SEPARATE ACCOUNT
NOTES TO FINANCIAL STATEMENTS
1. SIGNIFICANT ACCOUNTING POLICIES
The Pacific Select Exec Separate Account (the "Separate Account") is
registered as a unit investment trust under the Investment Company Act of
1940, as amended, and is currently comprised of twenty-two subaccounts called
Variable Accounts: the Aggressive Equity Variable Account, the Emerging
Markets Variable Account, the Growth Variable Account, the Bond and Income
Variable Account, the Equity Variable Account, the Multi-Strategy Variable
Account, the Equity Income Variable Account, the Growth LT Variable Account,
the Mid-Cap Value Variable Account, the Equity Index Variable Account, the
Small-Cap Index Variable Account, the REIT Variable Account, the International
Variable Account, the Government Securities Variable Account, the Managed Bond
Variable Account, the Money Market Variable Account, the High Yield Bond
Variable Account, the Large-Cap Value Variable Account, and the Variable
Accounts I through IV. The assets in each of the first eighteen Variable
Accounts are invested in shares of the corresponding portfolios of Pacific
Select Fund and the assets of the last four Variable Accounts (Brandes
International Equity, Turner Core Growth, Frontier Capital Appreciation and
Enhanced U.S. Equity) are invested in shares of the corresponding portfolios
of M Fund, Inc. (collectively, the "Funds"). Each Variable Account pursues
different investment objectives and policies. The financial statements of the
Funds, including the schedules of investments, are either included in Sections
B through E of this report or provided separately and should be read in
conjunction with the Separate Account's financial statements.
The Separate Account has organized and registered with the Securities and
Exchange Commission four new Variable Accounts: the Mid-Cap Value Variable
Account, the Small-Cap Index Variable Account, the REIT Variable Account, and
the Large-Cap Value Variable Account. The Mid-Cap Value Variable Account, the
Small-Cap Index Variable Account, and the Large-Cap Value Variable Account
commenced operations on January 8, 1999, and the REIT Variable Account
commenced operations on January 19, 1999.
The Separate Account was established by Pacific Life Insurance Company
("Pacific Life") on May 12, 1988 and commenced operations on November 22,
1988. Under applicable insurance law, the assets and liabilities of the
Separate Account are clearly identified and distinguished from the other
assets and liabilities of Pacific Life. The assets of the Separate Account
will not be charged with any liabilities arising out of any other business
conducted by Pacific Life, but the obligations of the Separate Account,
including benefits related to variable life insurance, are obligations of
Pacific Life.
The Separate Account held by Pacific Life represents funds from individual
flexible premium variable life policies. The assets of the Separate Account
are carried at market value.
The preparation of the accompanying financial statements requires management
to make estimates and assumptions that affect the reported amounts of assets
and liabilities at the date of the financial statements and the reported
amounts of income and expenses during the reporting period. Actual results
could differ from those estimates.
A. Valuation of Investments
Investments in shares of the Funds are valued at the reported net asset
values of the respective portfolios. Valuation of securities held by the Funds
is discussed in the notes to their financial statements.
B. Security Transactions
Transactions are recorded on the trade date. Realized gains and losses on
sales of investments are determined on the basis of identified cost.
C. Federal Income Taxes
The operations of the Separate Account will be reported on the Federal income
tax return of Pacific Life, which is taxed as a life insurance company under
the provisions of the Tax Reform Act of 1986. Under current tax law, no
Federal income taxes are expected to be paid by Pacific Life with respect to
the operations of the Separate Account.
2. DIVIDENDS
During 1999, the Funds declared dividends for each portfolio. The amounts
accrued by the Separate Account for its share of the dividends were reinvested
in additional full and fractional shares of the related portfolio.
3. CHARGES AND EXPENSES
With respect to variable life insurance policies funded by the Separate
Account, Pacific Life makes certain deductions from premiums for sales load
and state premium taxes before amounts are allocated to the Separate Account.
Pacific Life also makes certain deductions from the net assets of each
Variable Account for the mortality and expense risks Pacific Life assumes,
administrative expenses, cost of insurance, charges for optional benefits and
any sales and underwriting surrender charges. The operating expenses of the
Separate Account are paid by Pacific Life.
4. RELATED PARTY AGREEMENT
Pacific Mutual Distributors, Inc., a wholly-owned subsidiary of Pacific Life,
serves as principal underwriter of variable life insurance policies funded by
interests in the Separate Account, without remuneration from the Separate
Account.
I-1
<PAGE>
PACIFIC SELECT EXEC SEPARATE ACCOUNT
NOTES TO FINANCIAL STATEMENTS (Continued)
5. SEPARATE ACCOUNT'S COST OF INVESTMENTS IN THE FUNDS SHARES
The investment in the Funds shares are carried at identified cost, which
represents the amount available for investment (including reinvested
distributions of net investment income and realized gains). Total cost and
market value of the Separate Account's investments in the Funds as of December
31, 1999 were as follows (amounts in thousands):
<TABLE>
<CAPTION>
Variable Accounts
-------------------------------------------------------------------------------
Aggressive Emerging Bond and Multi- Equity Growth
Equity Markets Growth Income Equity Strategy Income LT
-------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Total cost of
investments at
beginning of year $16,338 $11,689 $187,167 $5,250 $16,061 $112,643 $147,393 $152,516
Add:Total net proceeds
from policy
transactions 19,528 12,400 103,914 4,132 40,979 16,057 33,867 110,353
Reinvested
distributions from
the Funds:
(a) Net investment
income 60 468 388 42 3,612 1,810
(b) Net realized gain 2,297 23,889 259 2,388 8,563 16,639 24,658
-------------------------------------------------------------------------------
Sub-Total 38,163 24,149 315,438 10,029 59,470 140,875 199,709 287,527
Less: Cost of
investments disposed
during the year 9,818 9,303 90,244 2,094 10,736 5,941 13,361 20,995
-------------------------------------------------------------------------------
Total cost of
investments at end of
year 28,345 14,846 225,194 7,935 48,734 134,934 186,348 266,532
Add: Unrealized
appreciation
(depreciation) 4,690 5,064 63,875 (938) 10,865 16,963 39,118 269,914
-------------------------------------------------------------------------------
Total market value of
investments at end of
year $33,035 $19,910 $289,069 $6,997 $59,599 $151,897 $225,466 $536,446
-------------------------------------------------------------------------------
<CAPTION>
Govern-
Mid-Cap Equity Small-Cap Inter- ment Managed Money
Value (1) Index Index (1) REIT (1) national Securities Bond Market
-------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Total cost of
investments at
beginning of year $212,820 $153,283 $16,677 $97,525 $69,218
Add: Total net proceeds
from policy
transactions $6,149 94,678 $6,917 $2,925 63,456 9,456 32,380 302,607
Reinvested
distributions from
the Funds:
(a) Net investment
income 10 4,038 27 76 1,200 1,012 5,982 4,600
(b) Net realized gain 1,562 68 6 6,201 266 2,557
-------------------------------------------------------------------------------
Sub-Total 6,159 313,098 7,012 3,007 224,140 27,411 138,444 376,425
Less: Cost of
investments disposed
during the year 1,017 14,733 1,253 224 36,021 4,025 17,721 245,132
-------------------------------------------------------------------------------
Total cost of
investments at end of
year 5,142 298,365 5,759 2,783 188,119 23,386 120,723 131,293
Add: Unrealized
appreciation
(depreciation) 66 136,200 667 (140) 27,230 (1,168) (6,526) (247)
-------------------------------------------------------------------------------
Total market value of
investments at end of
year $5,208 $434,565 $6,426 $2,643 $215,349 $22,218 $114,197 $131,046
-------------------------------------------------------------------------------
<CAPTION>
High Yield Large-Cap
Bond Value (1) I II III IV
-----------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Total cost of
investments at
beginning of year $45,134 $1,454 $2,467 $4,191 $4,437
Add: Total net proceeds
from policy
transactions 25,603 $5,805 7,684 16,504 3,055 2,983
Reinvested
distributions from
the Funds:
(a) Net investment
income 3,845 20 56 20 7
(b) Net realized gain 256 1,161 243 467
-----------------------------------------------------------
Sub-Total 74,582 5,825 9,450 20,152 7,489 7,894
Less: Cost of
investments disposed
during the year 24,254 505 965 915 1,191 2,579
-----------------------------------------------------------
Total cost of
investments at end of
year 50,328 5,320 8,485 19,237 6,298 5,315
Add: Unrealized
appreciation
(depreciation) (2,296) 58 1,442 2,385 2,165 690
-----------------------------------------------------------
Total market value of
investments at end of
year $48,032 $5,378 $9,927 $21,622 $8,463 $6,005
-----------------------------------------------------------
</TABLE>
- -------------------
(1) Operations commenced during 1999 (See Note 1 to Financial Statements).
I-2
<PAGE>
PACIFIC SELECT EXEC SEPARATE ACCOUNT
NOTES TO FINANCIAL STATEMENTS (Continued)
6. TRANSACTIONS IN SEPARATE ACCOUNT UNITS AND SELECTED ACCUMULATION UNIT **
INFORMATION
Transactions in Separate Account units for the year ended December 31, 1999
and the selected accumulation unit information as of December 31, 1999 were as
follows:
<TABLE>
<CAPTION>
Variable Accounts
----------------------------------------------------------------------------------------------
Aggressive Emerging Bond and Multi- Equity Growth
Equity Markets Growth Income Equity Strategy Income LT
----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Total units outstanding
at beginning of year 1,392,776 1,425,050 5,054,100 407,552 1,208,588 3,899,102 4,153,101 7,088,988
Increase (decrease) in
units resulting from
policy transactions:
(a) Transfer of net
premiums 446,295 391,154 731,566 146,464 466,028 378,029 566,767 1,090,385
(b) Transfers--policy
charges and deductions (109,665) (106,579) (260,557) (35,534) (119,693) (170,710) (209,156) (396,786)
(c) Transfers in (from
other variable
accounts) 2,146,964 3,074,166 4,963,234 535,185 3,543,441 572,679 1,295,559 4,047,924
(d) Transfers out (to
other variable
accounts) (1,801,331) (2,898,051) (5,249,564) (439,413) (2,178,697) (445,339) (1,169,106) (2,989,259)
(e) Transfers--other (41,457) (51,197) (278,610) (31,698) (41,773) (104,711) (236,551) (394,019)
----------------------------------------------------------------------------------------------
Sub-Total 640,806 409,493 (93,931) 175,004 1,669,306 229,948 247,513 1,358,245
----------------------------------------------------------------------------------------------
Total units outstanding
at end of year 2,033,582 1,834,543 4,960,169 582,556 2,877,894 4,129,050 4,400,614 8,447,233
----------------------------------------------------------------------------------------------
Accumulation Unit Value:
At beginning of year $12.76 $7.07 $39.51 $12.96 $14.95 $34.37 $45.24 $32.06
At end of year $16.24 $10.85 $58.28 $12.01 $20.71 $36.79 $51.24 $63.51
<CAPTION>
Govern-
Mid-Cap Equity Small-Cap Inter- ment Managed Money
Value (1) Index Index (1) REIT (1) national Securities Bond Market
----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Total units outstanding
at beginning of year 7,178,724 7,183,483 722,500 4,098,497 4,086,161
Increase (decrease) in
units resulting from
policy transactions:
(a) Transfer of net
premiums 101,351 1,525,978 154,672 32,153 1,297,474 162,177 639,829 14,668,834
(b) Transfers--policy
charges and deductions (15,187) (421,266) (16,372) (6,499) (385,569) (45,293) (202,469) (568,862)
(c) Transfers in (from
other variable
accounts) 733,125 3,170,097 1,703,414 317,169 5,106,667 511,147 2,606,449 26,594,956
(d) Transfers out (to
other variable
accounts) (308,361) (2,484,612) (1,291,374) (76,125) (4,851,038) (308,321) (2,349,734) (36,739,991)
(e) Transfers--other (7,378) (436,615) (3,136) (2,097) (335,483) (87,525) (108,284) (657,157)
-----------------------------------------------------------------------------------------------
Sub-Total 503,550 1,353,582 547,204 264,601 832,051 232,185 585,791 3,297,780
-----------------------------------------------------------------------------------------------
Total units outstanding
at end of year 503,550 8,532,306 547,204 264,601 8,015,534 954,685 4,684,288 7,383,941
-----------------------------------------------------------------------------------------------
Accumulation Unit Value:
At beginning of year $10.00 $42.23 $10.00 $10.00 $21.88 $23.74 $24.85 $16.91
At end of year $10.34 $50.93 $11.74 $9.99 $26.87 $23.27 $24.38 $17.75
<CAPTION>
High Yield Large-Cap
Bond Value (1) I II III IV
---------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Total units outstanding
at beginning of year 1,598,243 127,998 167,752 342,807 304,588
Increase (decrease) in
units resulting from
policy transactions:
(a) Transfer of net
premiums 351,193 86,694 95,802 72,580 94,055 49,583
(b) Transfers--policy
charges and deductions (90,794) (16,717) (16,143) (14,391) (22,248) (14,533)
(c) Transfers in (from
other variable
accounts) 1,565,039 580,019 404,864 806,745 246,076 500,082
(d) Transfers out (to
other variable
accounts) (1,635,967) (150,215) (43,231) (144,796) (161,952) (533,493)
(e) Transfers--other (67,640) (5,540) (4,604) (9,779) (46,779) (15,217)
---------------------------------------------------------------------
Sub-Total 121,831 494,241 436,688 710,359 109,152 (13,578)
---------------------------------------------------------------------
Total units outstanding
at end of year 1,720,074 494,241 564,686 878,111 451,959 291,010
---------------------------------------------------------------------
Accumulation Unit Value:
At beginning of year $27.14 $10.00 $11.89 $17.57 $12.99 $16.37
At end of year $27.92 $10.88 $17.58 $24.62 $18.72 $20.64
</TABLE>
- -------------------
** Accumulation Unit: unit of measure used to calculate the value of a Policy
Owner's interest in a Variable Account during the accumulation period.
(1) Operations commenced during 1999 (See Note 1 to Financial Statements).
I-3
<PAGE>
Annual Reports -----------------
as of December 31, 1999 FIRST CLASS
U.S. POSTAGE PAID
. Pacific Select Fund PACIFIC LIFE INS
92799
. Pacific Select Exec -----------------
Separate Account of
Pacific Life Insurance Company
Accountants
Deloitte & Touche LLP
695 Town Center Drive
Suite 1200
Costa Mesa, CA 92626
Counsel
Dechert Price & Rhoads
1775 Eye Street, N.W.
Washington, D.C. 20006-2401
Pacific Life Insurance Company
Client Services Department
700 Newport Center Drive
P.O. Box 7500
Newport Beach, California
92658-7500
ADDRESS SERVICE REQUESTED
Form No. 15-17463-10
