As filed with the Securities and Exchange Registration No. 333-49599
Commission on April 20, 1999
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
POST-EFFECTIVE AMENDMENT NO. 1
TO
FORM S-2
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Aetna Life Insurance and Annuity Company
----------------------------------------
Connecticut
----------------------------------------
71-0294708
----------------------------------------
151 Farmington Avenue, Hartford, Connecticut 06156, (860) 273-4686
--------------------------------------------------------------------
Julie E. Rockmore, Counsel
Aetna Life Insurance and Annuity Company
151 Farmington Avenue, RE4A, Hartford, Connecticut 06156
(860) 273-4686
----------------------------------------
(Name, Address, including Zip Code, and Telephone Number,
including Area Code, of Agent for Service)
- --------------------------------------------------------------------------------
The annuities covered by this registration statement are to be issued from time
to time after the effective date of this registration statement.
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933 check the following box. [XX]
If the registrant elects to deliver its latest annual report to security
holders, or a complete and legible facsimile thereof, pursuant to Item 11(a)(1)
of this Form, check the following box. [XX]
If this form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ] --------------
<PAGE>
If this form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration number of the earlier effective registration statement for the same
offering. [ ] ______________
If this form is a post-effective amendment filed pursuant to Rule 462(d) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ] ______________
If the delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
<PAGE>
CROSS REFERENCE SHEET
Pursuant to Regulation S-K
Item 501(b)
<TABLE>
<CAPTION>
Form S-2
Item No. Information Required in Prospectus LOCATION
-------- ---------------------------------- --------
<S> <C> <C>
1 Forepart of the Registration Statement and Outside Front
Cover Page of Prospectus ........................ Outside Front Cover
2 Inside Front and Outside Back Cover Table of Contents (inside front
Pages of Prospectus.............................. cover)
3 Summary Information, Risk Factors and Ratio of Earnings
to Fixed Charges................................. Summary
4 Use of Proceeds...................................... Investments
5 Determination of Offering Price...................... Not Applicable
6 Dilution............................................. Not Applicable
7 Selling Security Holders............................. Not Applicable
8 Plan of Distribution................................. Description of Guaranteed Account
9 Description of Securities to be
Registered....................................... Description of Guaranteed Account
10 Interests of Named Experts and
Counsel.......................................... Not Applicable
11 Information with Respect to the
Registrant........................................... Not Applicable
12 Incorporation of Certain Information Incorporation of Certain Documents by
by Reference......................................... Reference; Experts
13 Disclosure of Commission Position
on Indemnification for Securities
Act Liabilities...................................... Not Applicable
</TABLE>
<PAGE>
ALIAC Guaranteed Account - May 3, 1999
- --------------------------------------------------------------------------------
Introduction
The ALIAC Guaranteed Account (the Guaranteed Account) is a fixed interest option
available during the accumulation phase of certain variable annuity contracts
issued by Aetna Life Insurance and Annuity Company (the Company, we, us). Read
this prospectus carefully before investing in the Guaranteed Account and save it
for future reference.
General Description
The Guaranteed Account offers investors an opportunity to earn specified
guaranteed rates of interest for specified periods of time, called guaranteed
terms. We generally offer several guaranteed terms at any one time for those
considering investing in the Guaranteed Account. Each guaranteed term offers a
guaranteed interest rate for investments that remain in the Guaranteed Account
for the duration of the specific guaranteed term. The guaranteed term
establishes both the length of time for which we agree to credit a guaranteed
interest rate and how long your investment must remain in the Guaranteed Account
in order to receive the guaranteed interest rate.
We guarantee both principal and interest if, and only if, your investment
remains invested for the full guaranteed term. Charges related to the contract,
such as a maintenance fee or early withdrawal charge, may still apply even if
you withdraw at the end of the guaranteed term. Investments taken out of the
Guaranteed Account prior to the end of the guaranteed term may be subject to a
market value adjustment which may result in an investment gain or loss. (See
"Market Value Adjustment", page 10.)
This prospectus will explain:
> Guaranteed interest rates and guaranteed terms
> Contributions to the Guaranteed Account
> Types of investments available
> How rates are offered
> How there can be an investment risk, and how we calculate gain or loss
> Contract charges that can affect your account value in the Guaranteed Account
> Taking investments out of the Guaranteed Account
> How to reinvest or withdraw at maturity
Additional Disclosure Information
Neither the Securities and Exchange Commission (SEC) nor any state securities
commission has approved or disapproved of these securities or passed on the
accuracy or adequacy of this prospectus. Any representation to the contrary is a
criminal offense. We do not intend for this prospectus to be an offer to sell or
a solicitation of an offer to buy these securities in any state or jurisdiction
that does not permit their sale.
Our Home Office:
Aetna Life Insurance and Annuity Company
151 Farmington Avenue
Hartford, Connecticut 06156
(800)-531-4547
<PAGE>
TABLE OF CONTENTS
<TABLE>
<S> <C>
Page
Summary ..................................................................... 3
Description of the Guaranteed Account ....................................... 7
In General, Contributions to the Guaranteed Account, Deposit Period,
Guaranteed Terms, Guaranteed Interest Rates,
Maturity Value Transfer Provision
Transfers ................................................................... 10
Withdrawals ................................................................. 10
Deferral of Payments, Reinvestment Privilege
Market Value Adjustment (MVA) ............................................... 11
Calculation of the MVA, Deposit Period Yield, Current Yield, MVA Formula
Contract Charges ............................................................ 13
Other Topics ................................................................ 13
Income Phase -- Investments -- Distribution of Contracts -- Taxation --
Year 2000 Readiness -- Experts -- Legal Matters -- Further Information --
Incorporation of Certain Documents by Reference -- Inquiries
Appendix I -- Examples of Market Value Adjustment Calculations. ............. 18
Appendix II -- Examples of Market Value Adjustment Yields ................... 20
</TABLE>
<PAGE>
Summary
- --------------------------------------------------------------------------------
The Guaranteed Account is a fixed interest option that may be available during
the accumulation phase of your variable annuity contract. The following is a
summary of certain facts about the Guaranteed Account.
In General. Amounts that you invest in the Guaranteed Account will earn a
guaranteed interest rate if left in the Guaranteed Account for a specified
period of time (the guaranteed term). You must invest amounts in the Guaranteed
Account for the full guaranteed term in order to receive the quoted guaranteed
interest rate. If you withdraw or transfer those amounts before the end of the
guaranteed term, we may apply a "market value adjustment", which may be positive
or negative.
Deposit Periods. A deposit period is the time during which we offer a specific
guaranteed interest rate if you deposit dollars for a specific guaranteed term.
For a particular guaranteed interest rate and guaranteed term to apply to your
account dollars, you must invest them during the deposit period in which that
rate and term are offered.
Guaranteed Terms. The guaranteed term is the period of time account dollars must
be left in the Guaranteed Account in order to earn the guaranteed interest rate
specified for that guaranteed term. We offer different guaranteed terms at
different times. We may also offer more than one guaranteed term of the same
duration with different guaranteed interest rates. Check with your
representative or the Company to learn the details about the guaranteed term(s)
currently offered. We reserve the right to limit the number of guaranteed terms
or the availability of certain guaranteed terms.
Guaranteed Interest Rates. We guarantee different interest rates, depending upon
when account dollars are invested in the Guaranteed Account. For guaranteed
terms one year or longer, we may offer different rates for specified time
periods within a guaranteed term. The interest rate we guarantee is an annual
effective yield; that means that the rate reflects a full year's interest. We
credit interest at a rate that will provide the guaranteed annual effective
yield over one year. The guaranteed interest rate(s) are guaranteed for that
deposit period and for the length of the guaranteed term.
The guaranteed interest rates we offer will always meet or exceed the minimum
interest rates agreed to in the contract. Apart from meeting the contractual
minimum interest rates, we cannot guarantee any aspect of future offerings.
Fees and Other Deductions. We do not make deductions from amounts in the
Guaranteed Account to cover mortality and expense risks. We consider these risks
when determining the credited rate. The following other types of charges may be
deducted from amounts held in, withdrawn or transferred from the Guaranteed
Account:
> Market Value Adjustment (MVA). An MVA may be applied to amounts transferred or
withdrawn prior to the end of a guaranteed term, which reflects changes in
interest rates since the deposit period. The MVA may be positive or negative,
and therefore may increase or decrease the amount withdrawn to satisfy a
transfer or withdrawal request. See "Market Value Adjustment."
> Tax Penalties and/or Tax withholding. Amounts withdrawn may be subject to
withholding for federal income taxes, as well as a 10% penalty tax for
3
<PAGE>
amounts withdrawn prior to you having attained age 59-1/2. See "Taxation"; see
also the "Taxation" section of the contract prospectus
> Early Withdrawal Charge. An early withdrawal charge, which is a deferred sales
charge, may apply to amounts withdrawn from the contract, in order to
reimburse us for some of the sales and administrative expenses associated with
the contract. See "Contract Charges"; see also the "Fees" section of the
contract prospectus
> Maintenance Fee. A maintenance fee of up to $30 may be deducted, on an annual
basis, pro rata from all funding options including the Guaranteed Account. See
"Contract Charges", see also the "Fees" section of the contract prospectus
4
<PAGE>
[Begin sidebar]
Contract holder (You/Your): The contract holder of an individually owned
contract or the certificate holder of a group contract.
[End sidebar]
Market Value Adjustment (MVA). If you withdraw or transfer your account value
from the Guaranteed Account before the guaranteed term is completed, an MVA may
apply. The MVA reflects the change in the value of the investment due to changes
in interest rates since the date of deposit. The MVA may be positive or negative
depending upon interest rate activity at the time of withdrawal or transfer.
Withdrawals from the Guaranteed Account due to the election of a lifetime income
option or when a guaranteed death benefit is payable (if withdrawn within the
first six months following death) will be subject to an aggregate MVA (the sum
of all MVAs due to withdrawal) only if the aggregate MVA is positive.
Withdrawals from the Guaranteed Account due to the election of a nonlifetime
income option will be subject to an aggregate MVA, whether positive or negative.
An MVA will not apply to:
> Amounts transferred at the end of a guaranteed term
> Amounts transferred under the maturity value transfer provision
> Transfers due to participation in the dollar cost averaging program -- see
"Market Value Adjustment" for certain restrictions
> Amounts distributed under a systematic distribution option (SDO) -- see
"Systematic Distribution Options" in the contract prospectus
> Withdrawals for minimum distributions required by the Internal Revenue Code of
1986, as amended (Tax Code), and for which the early withdrawal charge is
waived
Maturity of a Guaranteed Term. On or before the end of a guaranteed term, you
may instruct us to
> Transfer the matured amount to one or more new guaranteed terms available
under the current deposit period
> Transfer the matured amount to other available investment options
> Withdraw the matured amount
Amounts withdrawn may be subject to an early withdrawal charge, a maintenance
fee, taxation and, if you are under age 59-1/2, tax penalties. (See "Contract
Charges" and the contract prospectus.)
When a guaranteed term ends, if we have not received instructions from you, we
will automatically transfer the maturing investment into a new guaranteed term
of similar length. (See "Maturity of a Guaranteed Term" and "Maturity Value
Transfer Provision".) If the same guaranteed term is no longer available, the
next shortest guaranteed term available in the current deposit period will be
used. If no shorter guaranteed term is available, and this amount is
automatically reinvested as noted above, the next longest guaranteed term will
be used.
If you do not provide instructions concerning the maturing amount on or before
the end of a guaranteed term, the maturity value transfer provision applies.
Maturity Value Transfer Provision. This provision allows transfers or
withdrawals of amounts automatically reinvested at the end of a guaranteed term
without an MVA, if the transfer or withdrawal occurs during the calendar month
immediately following a guaranteed term maturity date. Other fees, including an
early withdrawal charge, which is a deferred sales charge, and a
5
<PAGE>
maintenance fee (up to $30), may be assessed on amounts withdrawn. See "Maturity
Value Transfer Provision."
Transfer of Account Dollars. Generally, account dollars invested in the
Guaranteed Account may be transferred among guaranteed terms offered through the
Guaranteed Account, and/or to other investment options offered through the
contract. However:
> Transfers may not be made during the deposit period in which your account
dollars are invested in the Guaranteed Account or for 90 days after the close
of that deposit period
> We may apply an MVA to transfers made before the end of a guaranteed term
Investments. Guaranteed interest rates credited during any guaranteed term do
not necessarily relate to investment performance. Deposits received into the
Guaranteed Account will generally be invested in federal, state and municipal
obligations, corporate bonds, preferred stocks, real estate mortgages, real
estate, certain other fixed income investments, and cash or cash equivalents.
All of our general assets are available to meet guarantees under the Guaranteed
Account.
Amounts allocated to the Guaranteed Account are held in a nonunitized separate
account established by the Company under Connecticut law. To the extent provided
for in the contract, assets of the separate account are not chargeable with
liabilities arising out of any other business that we conduct. See
"Investments."
Notification of Maturity. We will notify you at least 18 calendar days prior to
the maturity of a guaranteed term. We will include information relating to the
current deposit period's guaranteed interest rates and the available guaranteed
terms. You may obtain information concerning available deposit periods,
guaranteed interest rates, and guaranteed terms by telephone (1-800-531-4547).
(See "Description of the ALIAC Guaranteed Account--General" and "Maturity of a
Guaranteed Term.")
6
<PAGE>
Description of the Guaranteed Account
- --------------------------------------------------------------------------------
General
The Guaranteed Account offers guaranteed interest rates for specific guaranteed
terms. For a particular guaranteed interest rate and guaranteed term to apply to
your account dollars, you must invest them during the deposit period in which
that rate and term are offered. For guaranteed terms of one year or longer, we
may offer different interest rates for specified time periods within a
guaranteed term. We also may offer more than one guaranteed term of the same
duration with different guaranteed interest rates.
An MVA may be applied to any values withdrawn or transferred from a guaranteed
term prior to the end of that guaranteed term, except for amounts transferred
under the maturity value transfer provision, amounts transferred under the
dollar cost averaging program, amounts withdrawn under an SDO, and amounts
withdrawn for minimum distributions required by the Tax Code. In the case of
amounts withdrawn from a guaranteed term when a guaranteed death benefit is
payable under the terms of the contract, we will apply an aggregate MVA (the sum
of all MVAs calculated due to this withdrawal) provided that it is positive and
provided that the withdrawal is requested within six months of death. This does
not apply at the death of a spousal beneficiary or joint contract holder who
continued the account in his or her own name after the first death, in which
case an aggregate MVA, whether positive or negative, will apply. If a death
benefit is paid more than six months from the date of death, the aggregate MVA,
whether positive or negative, will also be applied. In the case of values
withdrawn from guaranteed terms to provide income phase payments under one of
the lifetime income options, we will apply an aggregate MVA only if it is
positive. However, we will apply an aggregate MVA, whether positive or negative,
to amounts withdrawn to provide income phase payments under a nonlifetime income
option.
We maintain a toll-free telephone number for those wishing to obtain information
concerning available deposit periods, guaranteed interest rates, and guaranteed
terms. The telephone number is 1-800-531-4547. At least 18 calendar days before
a guaranteed term matures we will notify you of the upcoming deposit period
dates and information on the current guaranteed interest rates, guaranteed terms
and projected matured guaranteed term values.
Contributions to the Guaranteed Account
You may invest in the guaranteed terms available in the current deposit period
by allocating new payments to the Guaranteed Account or by transferring a sum
from other funding options available under the contract or from other guaranteed
terms of the Guaranteed Account, subject to the transfer limitations described
in the contract. We may limit the number of guaranteed terms you may select.
Currently, if the dollar cost averaging program is in effect in a guaranteed
term and you wish to add an additional deposit to be dollar cost averaged, all
amounts to be dollar cost averaged will have to be combined and the dollar cost
averaging amount will be recalculated. This will affect the duration of amounts
in the guaranteed term.
Although we reserve the right to limit the total number of investment options
you may select during the accumulation phase, there is currently no limit. The
7
<PAGE>
number of investment options you may select at any one time, however, is limited
to 18. Each guaranteed term counts as one investment option. Although we may
require a minimum payment(s) to a contract, we do not require a minimum
investment for a guaranteed term. Refer to the contract prospectus. There is a
$500 minimum for transfers from other funding options.
Investments may not be transferred from a guaranteed term during the deposit
period in which the investment is applied or during the first 90 days after the
close of the deposit period. This restriction does not apply to amounts
transferred or withdrawn under the maturity value transfer provision, to amounts
transferred under the dollar cost averaging program or, in some situations,
withdrawn because you discontinued the dollar cost averaging program, or to
amounts distributed under a systematic distribution option. See "Maturity Value
Transfer Provision" and "Transfers."
Deposit Period
The deposit period is the period of time during which you may direct investments
to a particular guaranteed term(s) and receive a stipulated guaranteed interest
rate(s). Each deposit period may be a month, a calendar quarter, or any other
period of time we specify.
Guaranteed Terms
A guaranteed term is the time we specify during which we credit the guaranteed
interest rate. We offer guaranteed terms at our discretion for various periods
ranging up to and including ten years. We may limit the number of guaranteed
terms you may select and may require enrollment in the dollar cost averaging
program.
Guaranteed Interest Rates
Guaranteed interest rates are the rates that we guarantee will be credited on
amounts applied during a deposit period for a specific guaranteed term. We may
offer different guaranteed interest rates on guaranteed terms of the same
duration. Guaranteed interest rates are annual effective yields, reflecting a
full year's interest. We credit interest at a rate that will provide the
guaranteed annual effective yield over one year. Guaranteed interest rates are
credited according to the length of the guaranteed term as follows:
Guaranteed Terms of One Year or Less. The guaranteed interest rate is credited
from the date of deposit to the last day of the guaranteed term.
Guaranteed Terms of Greater than One Year. Except for those contracts or
certificates issued in the State of New York, several different guaranteed
interest rates may be applicable during a guaranteed term of more than one year.
The initial guaranteed interest rate is credited from the date of deposit to the
end of a specified period within the guaranteed term. We may credit several
different guaranteed interest rates for subsequent specific periods of time
within the guaranteed term. For example, for a 5-year guaranteed term we may
guarantee 7% for the first year, 6.75% for the next two years, and 6.5% for the
remaining two years. We reserve the right, however, to apply one guaranteed
interest rate for an entire guaranteed term.
We will not guarantee or credit a guaranteed interest rate below the minimum
rate specified in the contract, nor will we credit interest at a rate above the
guaranteed interest rate we announce prior to the start of a deposit period.
8
<PAGE>
[Begin sidebar]
Business Day-- Any day on which the New York Stock Exchange is open.
[End sidebar]
Our guaranteed interest rates are influenced by, but do not necessarily
correspond to, interest rates available on fixed income investments we may buy
using deposits directed to the Guaranteed Account (see "Investments"). We
consider other factors when determining guaranteed interest rates including
regulatory and tax requirements, sales commissions and administrative expenses
borne by the Company, general economic trends, and competitive factors. We make
the final determination regarding guaranteed interest rates. We cannot predict
the level of future guaranteed interest rates.
Maturity of a Guaranteed Term. At least 18 calendar days prior to the maturity
of a guaranteed term, we will notify you of the upcoming deposit period, the
projected value of the amount maturing at the end of the guaranteed term, and
the guaranteed interest rate(s) and guaranteed term(s) available for the current
deposit period.
When a guaranteed term matures, the amounts in any maturing guaranteed term may
be:
> Transferred to a new guaranteed term(s), if available under the contract
> Transferred to any of the allowable investment options available under the
contract
> Withdrawn from the contract
We do not apply an MVA to amounts transferred or withdrawn from a guaranteed
term on the date the guaranteed term matures. Amounts withdrawn, however, may be
subject to an early withdrawal charge, a maintenance fee, taxation and, if the
contract holder is under age 59-1/2, tax penalties.
If we have not received direction from you by the maturity date of a guaranteed
term, we will automatically transfer the matured term value to a new guaranteed
term of similar length. If the same guaranteed term is no longer available, the
next shortest guaranteed term available in the current deposit period will be
used. If no shorter guaranteed term is available, the next longest guaranteed
term will be used.
Under the Guaranteed Account, each guaranteed term is counted as one funding
option. If a guaranteed term matures, and is renewed for the same term, it will
not count as an additional investment option for purposes of any limitation on
the number of investment options.
You will receive a confirmation statement, plus information on the new
guaranteed rate(s) and guaranteed term.
Maturity Value Transfer Provision
If we automatically reinvest the proceeds from a matured guaranteed term, you
may transfer or withdraw from the Guaranteed Account the amount that was
reinvested without an MVA. An early withdrawal charge and maintenance fee may
apply to withdrawals. If the full amount reinvested is transferred or withdrawn,
we will include interest credited to the date of the transfer or withdrawal.
This provision is only available until the last business day of the month
following the maturity date of the prior guaranteed term. This provision only
applies to the first request received from the contract holder with respect to a
particular matured guaranteed term value, regardless of the amount involved in
the transaction.
9
<PAGE>
Transfers
- --------------------------------------------------------------------------------
We allow you to transfer all or a portion of your account value to the
Guaranteed Account or to other investment options under the contract. We do not
allow transfers from any guaranteed term to any other guaranteed term or
investment option during the deposit period for that guaranteed term or for 90
days following the close of that deposit period. The 90-day wait does not apply
to:
> Amounts transferred on the maturity date or under the maturity value transfer
provision
> Amounts transferred from the Guaranteed Account before the maturity date due
to the election of an income phase payment option
> Amounts distributed under an SDO
> Amounts transferred from an available guaranteed term in connection with the
dollar cost averaging program
Transfers after the 90-day period are permitted from guaranteed term(s) to other
guaranteed term(s) available during a deposit period or to other available
investment options. We will apply an MVA to transfers made before the end of a
guaranteed term. Transfers within one calendar month of a term's maturity date
are not counted as one of the 12 free transfers of accumulated values in the
account.
When the contract holder requests the transfer of a specific dollar amount, we
account for any applicable MVA in determining the amount to be withdrawn from a
guaranteed term(s) to fulfill the request. Therefore, the amount we actually
withdraw from the guaranteed term(s) may be more or less than the requested
dollar amount. (See "Appendix I" for an example.) For more information on
transfers, see the contract prospectus.
Withdrawals
- --------------------------------------------------------------------------------
[Begin sidebar]
Guaranteed Term Group--A grouping of deposits or investments having the same
guaranteed term.
[End sidebar]
The contract allows for full or partial withdrawals from the Guaranteed Account
at any time during the accumulation phase. To make a full or partial withdrawal,
a request form (available from us) must be properly completed and submitted to
our Home Office (or other designated office as provided in the contract).
Full or partial withdrawals are made pro rata from a guaranteed term group. From
each guaranteed term group, we will first withdraw funds from the oldest deposit
period, then from the next oldest, and so on.
We may apply an MVA to withdrawals made prior to the end of a guaranteed term,
except for withdrawals made under the maturity value transfer provision. (See
"Market Value Adjustment.") We may deduct an early withdrawal charge and
maintenance fee. The early withdrawal charge is a deferred sales charge which
may be deducted upon withdrawal to reimburse us for some of the sales and
administrative expenses associated with the contract. A maintenance fee, up to
$30, may be deducted pro rata from each of the funding options, including GA.
Refer to the contract prospectus for a description of these charges. When a
request for a partial withdrawal of a specific dollar amount is made, we will
include the MVA in determining the amount to be withdrawn from the guaranteed
term(s) to fulfill the request. Therefore, the amount we actually take from the
guaranteed term(s) may be more or less than the dollar amount requested. (See
"Appendix I" for an example.)
10
<PAGE>
[Begin sidebar]
Aggregate MVA--The total of all MVAs applied due to a transfer or withdrawal.
[End sidebar]
Deferral of Payments
Under certain emergency conditions, we may defer payment of a Guaranteed Account
withdrawal for up to six months. Refer to the contract prospectus for more
details
Reinvestment Privilege
You may elect to reinvest all or a portion of a full withdrawal during the 30
days following such a withdrawal. We must receive amounts for reinvestment
within 60 days of the withdrawal.
We will apply reinvested amounts to the current deposit period. This means the
guaranteed annual interest rate and guaranteed terms available on the date of
reinvestment will apply. Amounts are reinvested in the same proportion as prior
to the full withdrawal. Any negative MVA we applied to a withdrawal will not be
refunded. Refer to the contract prospectus for further details.
Market Value Adjustment (MVA)
- --------------------------------------------------------------------------------
We apply an MVA to amounts transferred or withdrawn from the Guaranteed Account
prior to the end of a guaranteed term. To accommodate early withdrawals or
transfers, we may need to liquidate certain assets or use cash that could
otherwise be invested at current interest rates. When we sell assets prematurely
we could realize a profit or loss depending upon market conditions.
The MVA reflects changes in interest rates since the deposit period. When
interest rates increase after the deposit period, the value of the investment
decreases and the MVA amount may be negative. Conversely, when interest rates
decrease after the deposit period, the value of the investment increases and the
MVA amount may be positive. Therefore, the application of an MVA may increase or
decrease the amount withdrawn from a guaranteed term to satisfy a withdrawal or
transfer request.
We may apply an aggregate MVA to transfers made in order to fund a lifetime or
nonlifetime income payment option; however, we will not apply a negative
aggregate MVA to amounts transferred to fund lifetime income payment options. We
will also not apply a negative aggregate MVA to amounts withdrawn from
guaranteed terms due to your death, if withdrawn during the six months following
your death (other than at the death of a spousal beneficiary or joint contract
holder who continued the contract in his or her name after the first death).
After this six-month period, or upon the death of a spousal beneficiary or joint
contract holder who continued the contract in his or her name after the first
death, a positive or negative aggregate MVA may apply.
An MVA will not apply to:
> Amounts transferred at the end of a guaranteed term
> Transactions made under the maturity value transfer provision
> Transfers due to participation in the dollar cost averaging program*
> Amounts distributed under an SDO -- see "Systematic Distribution Options" in
the contract prospectus
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<PAGE>
> Withdrawals for minimum distributions required by the Tax Code and for which
the early withdrawal charge is waived
* If you discontinue the dollar cost averaging program and transfer the amounts
in it, subject to the Company's terms and conditions governing guaranteed
terms, to another guaranteed term, an MVA will apply.
Calculation of the MVA
The amount of the MVA depends upon the relationship between:
> The deposit period yield of U.S. Treasury Notes that will mature in the last
quarter of the guaranteed term
> The current yield of such U. S. Treasury Notes at the time of withdrawal
If the current yield is less than the deposit period yield, the MVA will
decrease the amount withdrawn from a guaranteed term to satisfy a transfer or
withdrawal request (the MVA will be positive). If the current yield is greater
than the deposit period yield, the MVA will increase the amount withdrawn from a
guaranteed term (the MVA will be negative or detrimental to the investor).
Deposit Period Yield
We determine the deposit period yield used in the MVA calculation by considering
interest rates prevailing during the deposit period of the guaranteed term from
which the transfer or withdrawal will be made. First, we identify the Treasury
Notes that mature in the last three months of the guaranteed term. Then, we
determine their yield-to-maturity percentages for the last business day of each
week in the deposit period. We then average the resulting percentages to
determine the deposit period yield.
Treasury Note information may be found each business day in publications such as
the Wall Street Journal, which publishes the yield-to-maturity percentages for
all Treasury Notes as of the preceding business day.
Current Yield
We use the same Treasury Notes identified for the deposit period yield to
determine the current yield -- Treasury Notes that mature in the last three
months of the guaranteed term. However, we use the yield-to-maturity percentages
for the last business day of the week preceding the withdrawal and average those
percentages to get the current yield.
MVA Formula
The mathematical formula used to determine the MVA is:
x
---
{(1+i)} 365
-----
{(1+j)}
where i is the deposit period yield; j is the current yield; and x is the number
of days remaining (computed from Wednesday of the week of withdrawal) in the
guaranteed term. (For examples of how we calculate MVA, refer to Appendix I.)
We make an adjustment in the formula of the MVA to reflect the period of time
remaining in the guaranteed term from the Wednesday of the week of a withdrawal.
12
<PAGE>
Contract Charges
- --------------------------------------------------------------------------------
Certain charges may be deducted directly or indirectly from the funding options
available under the contract, including the Guaranteed Account.
The contract may have a maintenance fee of up to $30 that we will deduct, on an
annual basis, pro rata from all funding options including the Guaranteed
Account. We may also deduct a maintenance fee upon full withdrawal of a
contract.
The contract may have an early withdrawal charge that we will deduct, if
applicable, upon a full or partial withdrawal from the contract. If the
withdrawal occurs prior to the maturity of a guaranteed term, both the early
withdrawal charge and an MVA may be assessed.
We do not deduct mortality and expense risk charges and other asset-based
charges that may apply to variable funding options from the Guaranteed Account.
These charges are only applicable to the variable funding options.
We may deduct premium taxes of up to 4% from amounts in the Guaranteed Account.
During the accumulation phase, transfer fees of up to $10 per transfer may be
deducted from amounts held in or transferred from the Guaranteed Account.
Refer to the contract prospectus for details on contract deductions.
Other Topics
- --------------------------------------------------------------------------------
Income Phase
The Guaranteed Account may not be used as a funding option during the income
phase. Amounts invested in guaranteed terms must be transferred to one or more
of the options available to fund income payments before income payments can
begin.
An aggregate MVA, as previously described, may be applied to amounts transferred
to fund income payments before the end of a guaranteed term. Amounts used to
fund lifetime income payments will receive either a positive aggregate MVA or
none at all; however, amounts transferred to fund a nonlifetime income payment
option can receive either a positive or negative aggregate MVA.
Refer to the contract prospectus for a discussion of the income phase.
Investments
Amounts applied to the Guaranteed Account will be deposited to a nonunitized
separate account established under Connecticut law. A nonunitized separate
account is a separate account in which the contract holder does not participate
in the performance of the assets through unit values or any other interest.
Contract holders allocating funds to the nonunitized separate account do not
receive a unit value of ownership of assets accounted for in this separate
account. The risk of investment gain or loss is borne entirely by the Company.
All Company obligations due to allocations to the nonunitized separate account
are contractual guarantees of the Company
13
<PAGE>
and are accounted for in the separate account. All of the general assets of the
Company are available to meet our contractual guarantees. To the extent provided
for in the applicable contract, the assets of the nonunitized separate account
are not chargeable with liabilities resulting from any other business of the
Company. Income, gains and losses of the separate account are credited to or
charged against the separate account without regard to other income, gains or
losses of the Company.
Types of Investments. We intend to invest primarily in investment-grade fixed
income securities including:
> Securities issued by the United States Government
> Issues of United States Government agencies or instrumentalities--these issues
may or may not be guaranteed by the United States Government
> Debt securities which have an investment grade, at the time of purchase,
within the four highest grades assigned by Moody's Investors Services, Inc.
(Aaa, Aa, A or Baa), Standard & Poor's Corporation (AAA, AA, A or BBB) or any
other nationally recognized rating service
> Other debt instruments, including those issued or guaranteed by banks or bank
holding companies, and of corporations, which although not rated by Moody's,
Standard & Poor's, or other nationally recognized rating services, are deemed
by the Company's management to have an investment quality comparable to
securities which may be purchased as stated above
> Commercial paper, cash or cash equivalents, and other short-term investments
having a maturity of less than one year which are considered by the Company's
management to have investment quality comparable to securities which may be
purchased as stated above
We may invest in futures and options. We purchase financial futures, related
options and options on securities solely for non-speculative hedging purposes.
Should securities prices be expected to decline, we may sell a futures contract
or purchase a put option on futures or securities to protect the value of
securities held in or to be sold for the general account or the nonunitized
separate account. Similarly, if securities prices are expected to rise, we may
purchase a futures contract or a call option against anticipated positive cash
flow or may purchase options on securities.
We are not obligated to invest the assets attributable to the contract according
to any particular strategy, except as required by Connecticut and other state
insurance laws. The guaranteed interest rates established by the Company may not
necessarily relate to the performance of the nonunitized separate account.
Distribution of Contracts
We serve as principal underwriter for the securities sold through this
prospectus. We are registered as a broker-dealer with the SEC and are a member
of the National Association of Securities Dealers, Inc.
We may offer customers of certain broker-dealers special guaranteed rates in
connection with the Guaranteed Account offered through the contracts and may
negotiate different commissions for these broker-dealers. For additional
information, see the contract prospectus.
14
<PAGE>
Taxation
You should seek advice from your tax adviser as to the application of federal
(and where applicable, state and local) tax laws to amounts paid to or
distributed under the contract. Refer to the contract prospectus for a
discussion of tax considerations.
Taxation of the Company. We are taxed as a life insurance company under Part I
of Subchapter L of the Internal Revenue Code of 1986, as amended. We own all
assets supporting the contract obligations of the Guaranteed Account. Any income
earned on such assets is considered income to the Company. We do not intend to
make any provision or impose a charge under the contract with respect to any tax
liability of the Company.
Taxation of Payments and Distributions. For information concerning the tax
treatment of payments to and distributions from the contract, please refer to
the contract prospectus.
Year 2000 Readiness
The Company is dependent upon computer systems and applications to conduct its
business. The Company has developed and is currently executing a comprehensive
risk-based plan designed to make its mission-critical information technology
(IT) systems and embedded systems Year 2000 ready. The plan for IT systems
covers five stages including (i) assessment, (ii) remediation, (iii) testing,
(iv) implementation and (v) Year 2000 approval. At year end 1997, the Company
had substantially completed the assessment stage. The remediation of
mission-critical IT systems was completed year end 1998. The Company expects to
incur internal staffing costs, as well as consulting and other expenses related
to infrastructure and facilities enhancements necessary to prepare its systems
for the Year 2000. Total Year 2000 costs for these systems were $21 million
(after tax) in 1998 and are currently estimated to be $16 million (after tax) in
1999 and are expected to be funded through operating cash flows.
The Company deals with affiliated and unaffiliated third parties in connection
with the investments made by the Company with the amounts allocated to the
Guaranteed Account. Aetna Inc. and the Company have initiated communication with
their critical external relationships to determine the extent to which the Aetna
organization may be vulnerable to such parties' failure to resolve their own
Year 2000 issues. The Aetna organization, including the Company, have assessed
and are prioritizing responses in an attempt to mitigate risks with respect to
the failure of these parties to be Year 2000 ready. The failure of third parties
to complete adequate preparations in a timely manner could have an adverse
effect on the operation of the Guaranteed Account, or the establishment of
future guaranteed interest rates.
Experts
We have incorporated by reference into Post Effective Amendment No. 1 to the
Registration Statement of which this prospectus is a part and/or into this
prospectus:
> The consolidated balance sheets of the Company as of December 31, 1998 and
1997 and the related consolidated statements of income, changes in
shareholder's equity and cash flows and all related schedules for each of the
years in the three-year period ended December 31, 1998
> The reports of KPMG LLP
15
<PAGE>
These statements are included in the Company's Annual Report on Form 10-K for
the year ended December 31, 1998. We have relied upon the reports of KPMG LLP,
independent certified public accountants, and upon their authority as experts in
accounting and auditing.
Legal Matters
The validity of the securities offered by this prospectus has been passed upon
by counsel to the Company.
Further Information
This prospectus does not contain all of the information contained in the
registration statement of which this prospectus is a part. Portions of the
registration statement have been omitted from this prospectus as allowed by the
SEC. You may obtain the omitted information from the offices of the SEC, as
described below.
We are required by the Securities Exchange Act of 1934 to file periodic reports
and other information with the SEC. You may inspect or copy information
concerning the Company at the Public Reference Room of the SEC at:
Securities and Exchange Commission
450 Fifth Street NW
Washington, DC 20549
You may also obtain copies of these materials at prescribed rates from the
Public Reference Room of the above office. You may obtain information on the
operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. You
may also find more information about the Company at http://www.aetna.com.
A copy of the Company's annual report on Form 10-K for the year ended December
31, 1998 accompanies this prospectus. We refer to Form 10-K for a description of
the Company and its business, including financial statements. We intend to send
contract holders annual account statements and other such legally required
reports. We do not anticipate such reports will include periodic financial
statements or information concerning the Company.
You can find this prospectus and other information the Company must file with
the SEC on the SEC's web site at http://www.sec.gov.
Incorporation of Certain Documents by Reference
We have incorporated by reference the Company's latest Annual Report on Form
10-K, as filed with the SEC and in accordance with the Securities and Exchange
Act of 1934. The Annual Report must accompany this prospectus. Form 10-K
contains additional information about the Company including certified financial
statements for the latest fiscal year. We were not required to file any other
reports pursuant to Sections 13(a) or 15(d) of the Securities and Exchange Act
since the end of the fiscal year covered by that Form 10-K.
16
<PAGE>
The registration statement for this prospectus incorporates some documents by
reference. We will provide a free copy of any such documents upon the request of
anyone who has received this prospectus. We will not include exhibits to those
documents unless they are specifically incorporated by reference into the
document. Direct requests to:
Aetna Life Insurance and Annuity Company
151 Farmington Avenue
Hartford, CT 06156
1-800-531-4547
Inquiries
You may contact us directly by writing to us at the address shown above or by
calling 1-800-531-4547.
17
<PAGE>
Appendix I
Examples of Market Value Adjustment Calculations
- --------------------------------------------------------------------------------
The following are examples of market value adjustment (MVA) calculations using
several hypothetical deposit period yields and current yields. These examples do
not include the effect of any early withdrawal charge that may be assessed under
the contract upon withdrawal.
EXAMPLE I
Assumptions:
i, the deposit period yield, is 8%
j, the current yield, is 10%
x, the number of days remaining (computed from Wednesday of the week of
withdrawal) in the guaranteed term, is 927.
x
---
MVA = {(1+i)}365
-----
{(1+j)}
927
---
= {(1.08)}365
------
{(1.10)}
=.9545
In this example, the deposit period yield of 8% is less than the current yield
of 10%; therefore, the MVA is less than 1. The amount withdrawn from the
guaranteed term is multiplied by this MVA.
If a withdrawal or transfer of a specific dollar amount is requested, the amount
withdrawn from a guaranteed term will be increased to compensate for the
negative MVA amount. For example, a withdrawal request to receive a check for
$2,000 would result in a $2,095.34 withdrawal from the guaranteed term.
Assumptions:
i, the deposit period yield, is 5%
j, the current yield, is 6%
x, the number of days remaining (computed from Wednesday of the week of
withdrawal) in the guaranteed term, is 927.
x
---
MVA = {(1+i)}365
-----
{(1+j)}
927
---
= {(1.05)}365
------
{(1.06)}
=.9762
In this example, the deposit period yield of 5% is less than the current yield
of 6%; therefore, the MVA is less than 1. The amount withdrawn from the
guaranteed term is multiplied by this MVA.
If a withdrawal or transfer of a specific dollar amount is requested, the amount
withdrawn from a guaranteed term will be increased to compensate for the
negative MVA amount. For example, a withdrawal request to receive a check for
$2,000 would result in a $2,048.76 withdrawal from the guaranteed term.
18
<PAGE>
EXAMPLE II
Assumptions:
i, the deposit period yield, is 10%
j, the current yield, is 8%
x, the number of days remaining (computed from Wednesday of the week of
withdrawal) in the guaranteed term, is 927.
x
---
MVA = {(1+i)}365
-----
{(1+j)}
927
---
= {(1.10)}365
------
{(1.08)}
=1.0477
In this example, the deposit period yield of 10% is greater than the current
yield of 8%; therefore, the MVA is greater than 1. The amount withdrawn from the
guaranteed term is multiplied by this MVA.
If a withdrawal or transfer of a specific dollar amount is requested, the amount
withdrawn from a guaranteed term will be increased to compensate for the
negative MVA amount. For example, a withdrawal request to receive a check for
$2,000 would result in a $1,908.94 withdrawal from the guaranteed term.
Assumptions:
i, the deposit period yield, is 5%
j, the current yield, is 4%
x, the number of days remaining (computed from Wednesday of the week of
withdrawal) in the guaranteed term, is 927.
x
---
MVA = {(1+i)}365
-----
{(1+j)}
927
---
= {(1.05)}365
------
{(1.04)}
=1.0246
In this example, the deposit period yield of 5% is greater than the current
yield of 4%; therefore, the MVA is greater than 1. The amount withdrawn from the
guaranteed term is multiplied by this MVA.
If a withdrawal or transfer of a specific dollar amount is requested, the amount
withdrawn from a guaranteed term will be increased to compensate for the
negative MVA amount. For example, a withdrawal request to receive a check for
$2,000 would result in a $1,951.98 withdrawal from the guaranteed term.
19
<PAGE>
Appendix II
Examples of Market Value Adjustment Yields
- --------------------------------------------------------------------------------
The following hypothetical examples show the MVA based upon a given current
yield at various times remaining in the guaranteed term. Table A illustrates the
application of the MVA based upon a deposit period yield of 10%; Table B
illustrates the application of the MVA based upon a deposit period yield of 5%.
The MVA will have either a positive or negative influence on the amount
withdrawn from or remaining in a guaranteed term. Also, the amount of the MVA
generally decreases as the end of the guaranteed term approaches.
TABLE A: Deposit Period Yield of 10%
<TABLE>
<CAPTION>
Change in
Deposit
Current Period Time Remaining to
Yield Yield Maturity of Guaranteed Term
------- --------- --------------------------------------------------------------------------
8 Years 6 Years 4 Years 2 Years 1 Year 3 Months
------- ------- ------- ------- ------ --------
<S> <C> <C> <C> <C> <C> <C> <C>
15% +5% -29.9% -23.4% -16.3% -8.5% -4.3% -1.1%
13% +3% -19.4 -14.9 -10.2 -5.2 -2.7 -0.7
12% +2% -13.4 -10.2 -7.0 -3.5 -1.8 -0.4
11% +1% -7.0 -5.3 -3.6 -1.8 -0.9 -0.2
9% -1% 7.6 5.6 3.7 1.8 0.9 0.2
8% -2% 15.8 11.6 7.6 3.7 1.9 0.5
7% -3% 24.8 18.0 11.7 5.7 2.8 0.7
5% -5% 45.1 32.2 20.5 9.8 4.8 1.2
</TABLE>
TABLE B: Deposit Period Yield of 5%
<TABLE>
<CAPTION>
Change in
Deposit
Current Period Time Remaining to
Yield Yield Maturity of Guaranteed Term
------- --------- ---------------------------------------------------------------------------
8 Years 6 Years 4 Years 2 Years 1 Year 3 Months
------- ------- ------- ------- ------ --------
<S> <C> <C> <C> <C> <C> <C> <C>
9% +4% -25.9% -20.1% -13.9% -7.2% -3.7% -0.9%
8% +3% -20.2 -15.6 -10.7 -5.5 -2.8 -0.7
7% +2% -14.0 -10.7 -7.3 -3.7 -1.9 -0.5
6% +1% -7.3 -5.5 -3.7 -1.9 -0.9 -0.2
4% -1% 8.0 5.9 3.9 1.9 1.0 0.2
3% -2% 16.6 12.2 8.0 3.9 1.9 0.5
2% -3% 26.1 19.0 12.3 6.0 2.9 0.7
1% -4% 36.4 26.2 16.8 8.1 4.0 1.0
</TABLE>
20
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
Not Applicable
Item 15. Indemnification of Directors and Officers
Section 21 of Public Act No. 97-246 of the Connecticut General Assembly (the
"Act") provides that a corporation may provide indemnification of or advance
expenses to a director, officer, employee or agent only as permitted by Sections
33-770 to 33-778, inclusive, of the Connecticut General Statutes, as amended by
Sections 12 to 20, inclusive, of this Act. Reference is hereby made to Section
33-771(e) of the Connecticut General Statutes ("CGS") regarding indemnification
of directors and Section 33-776(d) of CGS regarding indemnification of officers,
employees and agents of Connecticut corporations. These statutes provide in
general that Connecticut corporations incorporated prior to January 1, 1997
shall, except to the extent that their certificate of incorporation expressly
provides otherwise, indemnify their directors, officers, employees and agents
against "liability" (defined as the obligation to pay a judgment, settlement,
penalty, fine, including an excise tax assessed with respect to an employee
benefit plan, or reasonable expenses incurred with respect to a proceeding) when
(1) a determination is made pursuant to Section 33-775 that the party seeking
indemnification has met the standard of conduct set forth in Section 33-771 or
(2) a court has determined that indemnification is appropriate pursuant to
Section 33-774. Under Section 33-775, the determination of and the authorization
for indemnification are made (a) by the disinterested directors, as defined in
Section 33-770(3); (b) by special counsel; (c) by the shareholders; or (d) in
the case of indemnification of an officer, agent or employee of the corporation,
by the general counsel of the corporation or such other officer(s) as the board
of directors may specify. Also, Section 33-772 provides that a corporation shall
indemnify an individual who was wholly successful on the merits or otherwise
against reasonable expenses incurred by him in connection with a proceeding to
which he was a party because he was a director of the corporation. In the case
of a proceeding by or in the right of the corporation or with respect to conduct
for which the director, officer, agent or employee was adjudged liable on the
basis that he received a financial benefit to which he was not entitled,
indemnification is limited to reasonable expenses incurred in connection with
the proceeding against the corporation to which the individual was named a
party.
The statute does specifically authorize a corporation to procure indemnification
insurance on behalf of an individual who was a director, officer, employer or
agent of the corporation. Consistent with the statute, Aetna Inc. has procured
insurance from Lloyd's of London and several major United States excess insurers
for its directors and officers and the directors and officers of its
subsidiaries, including the Depositor.
<PAGE>
Item 16. Exhibits
Exhibits
(4) Instruments Defining the Rights of Security Holders:
(a) Variable Annuity Contract (G-CDA-97(NY))(1)
(b) Variable Annuity Contract Certificate (GMCC-97(NY)) to
Contract G-CDA-97(NY)(1)
(c) Variable Annuity Contract (G-MP1(5/97))(2)
(d) Variable Annuity Contract Certificate (MP1CERT(5/97))(2)
(e) Variable Annuity Contract (I-MP1(5/97))(2)
(f) Variable Annuity Contract (G-MP1(5/96))(3)
(g) Variable Annuity Contract Certificate (MP1CERT(5/96))(3)
(h) Variable Annuity Contract (I-MP1(5/96))(3)
(i) Variable Annuity Contract (G-CDA-96(NY))(3)
(j) Variable Annuity Contract Certificate (GMCC-96(NY))(3)
(k) Variable Annuity Contracts and Certificates (G-CDA-IC(NQ)),
(G-CDA-IC(IR)), (I-CDA-IC(NQ/MP)), (I-CDA-IC(IR/MP)) and
(GMCC-IC(NQ))(4)
(l) Variable Annuity Contracts and Certificates
(G-CDA-IC(IR/NY)), (GMCC-IC(IR/NY)), (G-CDA-IC(NQ/NY)) and
(GMCC-IC(NQ/NY))(5)
(m) Variable Annuity Contract Certificate (GMCC-IC(IR))(6)
(n) Endorsements (MP1IRA(5/97)) and (I-MP1IRA(5/97)) to Contract
G-MP1(5/96) and Certificate MP1CERT(5/96)(3)
(o) Endorsements (MP1QP(5/97)) and (I-MP1QP(5/97)) to Contract
G-MP1(5/96) and Certificate MP1CERT(5/96)(3)
(p) Endorsements (MP1TDA(5/97)) and (I-MP1TDA(5/97)) to Contract
G-MP1(5/96) and Certificate MP1CERT(5/96)(3)
(q) Endorsements (MP1DC(5/97)) and (I-MP1DC(5/97)) to Contract
G-MP1(5/96) and Certificate MP1CERT(5/96)(3)
(r) Endorsement (G-MP1IRA(11/96)) to Contract G-CDA-96(NY) and
Certificate GMCC-96(NY)(3)
(s) Endorsement (MP1END(9/97)) to Contract G-MP1(5/97) and
Certificate MP1CERT(5/97)(7)
(t) Endorsement (I-MP1END(9/97)) to Contract I-MP1(5/96)(2)
(u) Endorsement (E1-MPROTH-97) to Contract G-MP1(5/97)(1)
(v) Endorsement (EI1MPROTH-97) to Contract I-MP1(5/97)(1)
(w) Endorsement (MP1IRA(11/97)) to Contract G-MP1(5/97)(1)
(x) Endorsement (I-MP1IRA(11/97)) to Contract I-MP1(5/97)(1)
(y) Endorsement (I-MP1END(9/97)) to Contract I-MP1(5/97)(1)
(z) Endorsement (MPNQEND(4/95)) to Contract G-CDA-IC(NQ)(8)
<PAGE>
(aa) Endorsement (MPIREND(4/95)) to Contract G-CDA-IC(IR)(8)
(bb) Endorsement (IMPNQEND(4/95)) to Contract I-CDA-IC(NQ/MP)(8)
(cc) Endorsement (IMPIREND(4/95)) to Contract I-CDA-IC(IR/MP)(8)
(dd) Endorsement (EMPGET98) to Contract G-MP1(5/97) and
Certificate MP1CERT(5/97)(9)
(ee) Endorsement (MPNQCERTEND(4/95)) to Certificate
GMCC-IC(NQ)(8)
(ff) Endorsement (MPIRCERTEND(4/95)) to Certificate
GMCC-IC(IR)(8)
(gg) Contract Schedule I Accumulation Period (G-MP1(11/97)-5) to
Group Contract G-MP1(5/97)(1)
(hh) Contact Schedule I Accumulation Period (I-MP1(11/97)-5) to
Individual Contract I-MP1(5/97)(1)
(ii) Variable Annuity Contract Application (300-MAR-IB)(10)
(jj) Variable Annuity Contract Application (710.6.13)(10)
(kk) Variable Annuity Contract Application (MPAPPNY(1/96))(1)
(ll) Aetna Growth Plus Group Variable, Fixed or Combination
Annuity Contract (Nonparticipating) (G-CDA-GPI(4/94))(11)
(mm) Aetna Growth Plus Individual Variable, Fixed or Combination
Annuity Contract (Nonparticipating) (I-CDA-GPI(4/94))(11)
(nn) Certificate of Group Annuity Coverage (GP1CERT(4/94))(11)
(oo) Variable Fixed or Combination Annuity Contract
(Nonparticipating) (I-GP1(5/96))(12)
(pp) Group Variable, Fixed or Combination Annuity Contract
(Nonparticipating) (G-GP1(5/96))(12)
(qq) Certificate of Group Annuity Coverage (GP1CERT(5/96))(12)
(rr) Application for Growth Plus (GPAPPNY(1/96))(11)
(ss) Application for Aetna Growth Plus Group Variable, Fixed or
Combination Annuity Contract (Nonparticipating)
(GP1APP(4/94))(11)
(tt) Application for Aetna Growth Plus Individual Variable, Fixed
or Combination Annuity Contract (Nonparticipating)
(I-GP1APP(4/94))(11)
(uu) Variable Annuity Contract (GM-VA-98)(13)
(vv) Variable Annuity Contract Certificate (GMC-VA-98)(13)
(ww) Endorsement (EVAGET98)(15)
(xx) Endorsement (EGET-99) to Contracts and Certificates Nos.:
G-CDA-97(NY), GMCC-97(NY), G-MP1(5/97), MP1CERT(5/97),
MP1END(9/97), E1-MPROTH-97, MP1IRA(11/97), EMPGET98,
GM-VA-98, and
GMC-VA-98(14)
(yy) Variable Annuity Contract Application (9.5.89-6(9/98))(16)
(5) Opinion re Legality
(10) Material contracts are listed under Item 14(a)10 in the
Company's Form 10-K for the fiscal year ended December 31,
1998 (File No. 33-23376), as filed with the
<PAGE>
Commission on March 25, 1999. Each of the Exhibits so listed
is incorporated by reference as indicated in the Form 10-K.
(23) (a) Consent of Independent Auditors
(b) Consent of Legal Counsel (included in Exhibit (5) above)
(24) (a) Powers of Attorney(16)
(b) Certificate of Resolution Authorizing Signature by Power
of Attorney(17)
(27) Financial Data Schedule
Exhibits other than those listed above are omitted because they are not required
or are not applicable.
1. Incorporated by reference to Post-Effective Amendment No. 32 to
Registration Statement on Form N-4 (File No. 33-34370), as filed on
December 16, 1997.
2. Incorporated by reference to Post-Effective Amendment No. 30 to
Registration Statement on Form N-4 (File No. 33-34370), as filed on
September 29, 1997.
3. Incorporated by reference to Post-Effective Amendment No. 26 to
Registration Statement on Form N-4 (File No. 33-34370), as filed on
February 21, 1997.
4. Incorporated by reference to Post-Effective Amendment No. 15 to
Registration Statement on Form N-4 (File No. 33-34370), as filed on April
19, 1994.
5. Incorporated by reference to Post-Effective Amendment No. 1 to Registration
Statement on Form N-4 (File No. 33-87932), as filed on September 19, 1995.
6. Incorporated by reference to Post-Effective Amendment No. 37 to
Registration Statement on Form N-4 (File No. 33-34370), as filed on April
9, 1999.
7. Incorporated by reference to Post-Effective Amendment No. 33 to
Registration Statement on Form N-4 (File No. 33-34370), as filed on
February 27, 1998.
8. Incorporated by reference to Post-Effective Amendment No. 34 to
Registration Statement on Form N-4 (File No. 33-87932), as filed on
February 27, 1998.
9. Incorporated by reference to Post-Effective Amendment No. 37 to
Registration Statement on Form N-4 (File No. 33-34370), as filed on
September 14, 1998.
10. Incorporated by reference to Post-Effective Amendment No. 29 to
Registration Statement on Form N-4 (File No. 33-34370), as filed on August
18, 1997.
11. Incorporated by reference to Post-Effective Amendment No. 8 to Registration
Statement on Form N-4 (File No. 33-79122), as filed on April 17, 1998.
12. Incorporated by reference to Post-Effective Amendment No. 7 to Registration
Statement on Form N-4 (File No. 33-79122), as filed on April 22, 1996.
13. Incorporated by reference to Registration Statement on Form N-4 (File No.
333-56297), as filed on June 8, 1998.
14. Incorporated by reference to Post-Effective Amendment No. 13 to
Registration Statement on Form N-4 (File No. 333-01107), as filed on April
7, 1999.
15. Incorporated by reference to Post-Effective Amendment No. 1 to Registration
Statement on Form N-4 (File No. 333-56297), as filed on September 14, 1998.
<PAGE>
16. Incorporated by reference to Post-Effective Amendment No. 5 to Registration
Statement on Form N-4 (File No. 333-56297), as filed on February 25, 1999.
17. Incorporated by reference to Post-Effective Amendment No. 5 to Registration
Statement on Form N-4 (File No. 33-75986), as filed on April 12, 1996.
<PAGE>
Item 17. Undertakings
The undersigned registrant hereby undertakes as follows, pursuant to Item
512 of Regulation S-K:
(a) Rule 415 offerings:
(1) To file, during any period in which offers or sales of the
registered securities are being made, a post-effective amendment
to this registration statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or
the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the registration
statement; and
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the
registration statement or any material changes to such
information in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall
be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide
offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
(h) Request for Acceleration of Effective Date:
Insofar as indemnification for liabilities 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
<PAGE>
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.
Item 18. Financial Statements and Schedules
Not Applicable
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-2 and has duly caused this Post-Effective
Amendment No. 1 to the Registration Statement on Form S-2 (File No. 333-49599)
to be signed on its behalf by the undersigned, thereunto duly authorized in the
City of Hartford, State of Connecticut, on this 20th day of April, 1999.
AETNA LIFE INSURANCE AND ANNUITY COMPANY
(REGISTRANT)
By: Thomas J. McInerney*
---------------------------------------
Thomas J. McInerney
President
Pursuant to the requirements of the Securities Act of 1933, this
Post-Effective Amendment No. 1 to Registration Statement has been signed by the
following persons in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
- --------- ----- ----
<S> <C> <C>
Thomas J. McInerney* Director and President )
- ------------------------------------- (principal executive officer) )
Thomas J. McInerney )
)
Catherine H. Smith* Director and Chief Financial Officer ) April
- ------------------------------------- )
Catherine H. Smith ) 20, 1999
)
Shaun P. Mathews* Director )
- ------------------------------------- )
Shaun P. Mathews )
)
Deborah Koltenuk* Vice President, Treasurer and Corporate Controller )
- ------------------------------------- )
Deborah Koltenuk )
</TABLE>
By: /s/ J. Neil McMurdie
------------------------------------------------------------
J. Neil McMurdie
*Attorney-in-Fact
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Exhibit
- ----------- -------
<S> <C> <C>
16(5) Opinion re: Legality
-------------
16(23)(a) Consent of Independent Auditors
-------------
16(23)(b) Consent of Legal Counsel (included in Exhibit 16(5) above)
</TABLE>
[Aetna letterhead]
[Aetna logo] 151 Farmington Avenue
Hartford, CT 06156
Julie E. Rockmore
Counsel
Law Division, RE4A
Investments & Financial Services
April 20, 1998 (860) 273-4686
Fax: (860) 273-8340
Securities and Exchange Commission
450 Fifth Street N.W.
Washington, DC 20549
Re: Aetna Life Insurance and Annuity Company
Post-Effective Amendment No. 1 to Registration Statement on Form S-2
Prospectus Title: ALIAC Guaranteed Account
File No.: 333-49599
Dear Sirs:
As Counsel of Aetna Life Insurance and Annuity Company (the "Company"), I have
represented the Company in connection with the ALIAC Guaranteed Account (the
"Guaranteed Account"), a guaranteed interest option available under certain
variable annuity contracts, and the Form S-2 Registration Statement relating to
such account.
In connection with this opinion, I or those for whom I have supervisory
responsibility, have reviewed the Registration Statement on Form S-2 for the
Guaranteed Account, including the prospectus, and relevant proceedings of the
Board of Directors.
Based upon this review, and assuming the securities represented by the
Guaranteed Account are issued in accordance with the provisions of the
prospectus, I am of the opinion that the securities, when sold, will have been
legally issued, and will constitute a legal and binding obligation of the
Company.
I further consent to the use of this opinion as an exhibit to the Registration
Statement.
Sincerely,
/s/ Julie E. Rockmore
Julie E. Rockmore
Counsel
Aetna Life Insurance and Annuity Company
Consent of Independent Auditors
The Shareholder and Board of Directors of
Aetna Life Insurance and Annuity Company:
We consent to the incorporation by reference in the registration statement No.
333-49599 on Post-Effective Amendment No. 1 on Form S-2 of Aetna Life Insurance
and Annuity Company and Subsidiary (the "Company") of our reports dated February
3, 1998 relating to the consolidated balance sheets of the Company as of
December 31, 1998 and 1997, and the related consolidated statements of income,
changes in shareholder's equity, and cash flows and all related schedules for
each of the years in the three-year period ended December 31, 1998, which
reports appear in the December 31, 1998 annual report on Form 10-K of the
Company and to the reference to our firm under the heading "Experts" in the
prospectus.
/s/ KPMG LLP
Hartford, Connecticut
April 20, 1999
