<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 1, 1996
Registration No. 33-45851
Registration No. 811-5803
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
___________
FORM N-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 / /
Pre-Effective Amendment No. / /
Post-Effective Amendment No. 5 /x/
AND/OR
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 / /
Amendment No. 26 /x/
___________
VA-I SEPARATE ACCOUNT
of
UNUM LIFE INSURANCE COMPANY OF AMERICA
(Exact Name of Registrant)
UNUM LIFE INSURANCE COMPANY OF AMERICA
(Name of Depositor)
2211 Congress Street
Portland, Maine 04122
(Address of Depositor's Principal Executive Offices)
Depositor's Telephone Number, including Area Code: 207-770-2211
ROSEMARY MOORE, ESQUIRE
UNUM Life Insurance Company of America
2211 Congress Street
Portland, Maine 04122
(Name and Address of Agent for Service)
It is proposed that this filing will become effective (check appropriate box)
/ / immediately upon filing pursuant to paragraph (b) of Rule 485
/ / on March 1, 1996, pursuant to paragraph (b) of Rule 485
/x/ 60 days after filing pursuant to paragraph (a)(i) of Rule 485
/ / on , pursuant to paragraph (a)(i) of Rule 485
/ / 75 days after filing pursuant to paragraph (a)(ii)
/ / on , pursuant to paragraph (a)(ii) of rule 485.
If appropriate, check the following box:
/ / this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
In accordance with Rule 24f-2 under the Investment Company Act of 1940, the
Registrant has registered an indefinite number or amount of its securities under
the Securities Act of 1933. That election was previously filed in Registrant's
Form N-4 registration statement (File No. 33-45851). The Registrant filed its
Rule 24f-2 Notice on February 29, 1996, for the most recent fiscal year ended
December 31, 1995.
<PAGE>
CROSS REFERENCE SHEET
SHOWING LOCATION OF INFORMATION IN PROSPECTUS
<TABLE>
<CAPTION>
FORM N-4 PROSPECTUS CAPTION
- -------- ------------------
<S> <C>
1. Cover Page . . . . . . . . . . . . . Cover Page
2. Definitions. . . . . . . . . . . . . Definitions
3. Synopsis or Highlights . . . . . . . Summary
4. Condensed Financial Information. . . Condensed Financial Information
5. General Description of Registrant,
Depositor and Portfolio companies. . UNUM/America, The Proposed Sale,
The Variable Investment Division
and the Funds
6. Deductions and Expenses. . . . . . . Deductions and Charges
7. General Description of Variable
Annuity Contracts. . . . . . . . . . Contract Provisions; Other Contract Provisions
8. Annuity Period . . . . . . . . . . . Annuity Period
9. Death Benefit. . . . . . . . . . . . Contract Provisions, Death Benefits
10. Purchases and Contract Values. . . . Contract Provisions
11. Redemptions. . . . . . . . . . . . . Contract Provisions, Withdrawals
12. Taxes. . . . . . . . . . . . . . . . Federal Income Tax Considerations
13. Legal Proceedings. . . . . . . . . . Not Applicable
14. Table of Contents of the Statement
of Additional Information. . . . . . Contents of Statement of Additional Information
</TABLE>
CROSS REFERENCE SHEET
SHOWING LOCATION OF INFORMATION IN STATEMENT OF ADDITIONAL INFORMATION
<TABLE>
<CAPTION>
STATEMENT OF ADDITIONAL
FORM N-4 INFORMATION CAPTION
- -------- -----------------------
<S> <C>
15. Cover Page . . . . . . . . . . . . . Cover Page
16. Table of Contents. . . . . . . . . . Table of Contents
17. General Information and History. . . Prospectus-UNUM/America, The
Proposed Sale, The Variable Investment
Division and the Funds
18. Services . . . . . . . . . . . . . . Not Applicable
19. Purchase of Securities being
Offered. . . . . . . . . . . . . . . Not Applicable
20. Underwriters . . . . . . . . . . . . Distribution of the Contracts
21. Calculation of Yield Quotations of
Money Market Sub Accounts. . . . . . Not Applicable
22. Annuity Payments . . . . . . . . . . Determination of Variable Annuity Payment
23. Financial Statements . . . . . . . . Financial Statements
</TABLE>
CROSS REFERENCE SHEET
SHOWING LOCATION OF INFORMATION IN PART C-OTHER INFORMATION
<TABLE>
<S> <C>
24(a) Financial Statements and Exhibits. . Not Applicable
24(b) Exhibits . . . . . . . . . . . . . . Exhibits
25. Directors and Officers of the
Depositor. . . . . . . . . . . . . . Directors and Officers of the Depositor
26. Persons Controlled by or Under
Common Control with the Depositor
or Registrant. . . . . . . . . . . . Organizational Chart
27. Number of Contract Owners. . . . . . Number of Contract Owners
28. Indemnification. . . . . . . . . . . Indemnification
29. Principal Underwriters . . . . . . . Principal Underwriters
30. Location of Accounts and Records . . Location of Accounts and Records
31. Management Services. . . . . . . . . Management Services
32. Undertakings . . . . . . . . . . . . Undertakings
</TABLE>
<PAGE>
UNUM
LIFE INSURANCE
COMPANY OF AMERICA
Group Variable Annuity Contracts
VA-I SEPARATE ACCOUNT
2211 Congress Street
Portland, Maine 04122
(207) 770-2211
VARIABLE ANNUITY III
- --------------------------------------------------------------------------------
PROSPECTUS
- --------------------------------------------------------------------------------
MAY 1, 1996
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING IN ANY JURISDICTION IN
WHICH SUCH OFFERING MAY NOT LAWFULLY BE MADE. NO PERSON IS AUTHORIZED TO MAKE
ANY REPRESENTATION IN CONNECTION WITH THIS OFFERING OTHER THAN THOSE CONTAINED
IN THIS PROSPECTUS.
THIS PROSPECTUS IS VALID ONLY WHEN ACCOMPANIED BY THE CURRENT PROSPECTUS OF
THE APPLICABLE UNDERLYING FUNDS WHICH SHOULD BE RETAINED FOR FUTURE REFERENCE.
80010
This prospectus describes group annuity contracts ("Contracts") offered by UNUM
Life Insurance Company of America ("UNUM/America"), a subsidiary of UNUM Holding
Company and its wholly-owned parent company, UNUM Corporation. The Contracts are
designed to enable Participants and Employers to accumulate funds for retirement
programs meeting the requirements of the following Sections of the Internal
Revenue Code of 1986, as amended (the "Code"): 401(a), 403(b), 408 and 457 and
other related Sections as well as for programs offering non-qualified annuities.
A Participant is an employee or other person affiliated with the Contractholder
on whose behalf a Participant Account is maintained under the terms of the
Contract.
The Contracts permit Contributions to be deposited in the Guaranteed Interest
Division, which is part of UNUM/America's General Account, and in certain
Sub-Accounts in UNUM/America's VA-I Separate Account ("Variable Investment
Division"). Contributions to the Guaranteed Interest Division earn interest at a
guaranteed rate declared by UNUM/America. Contributions to the Variable
Investment Division will increase or decrease in dollar value depending on the
investment performance of the underlying funds in which the Sub-Accounts invest.
Currently, the Variable Investment Division consists of the nine Sub-Accounts
listed below: Next to each listed Sub-Account is the name of the fund (the
"Fund") in which the Sub-Account invests. For more information about the
investment objectives, policies and risks of the Funds please refer to the
prospectus for each of the Funds.
<PAGE>
Index Account. . . . . . . . . . . "Dreyfus Stock Index Fund"
Growth I Account . . . . . . . . . Fidelity's "Variable Insurance Products
Fund: Growth Portfolio"
Asset Manager Account. . . . . . . Fidelity's "Variable Insurance Products Fund
II: Asset Manager Portfolio"
Growth II Account. . . . . . . . . Twentieth Century's "TCI Portfolios, Inc.:
TCI Growth"
Balanced Account . . . . . . . . . Twentieth Century's "TCI Portfolios, Inc.:
TCI Balanced"
International Stock Account. . . . "T. Rowe Price International Series, Inc."
Socially Responsible Account . . . "Calvert Responsibly Invested Balanced
Portfolio"
Equity-Income Account. . . . . . . Fidelity's "Variable Insurance Products
Fund: Equity-Income Portfolio"
Small Cap Account. . . . . . . . . "Dreyfus Variable Investment Fund: Small Cap
Portfolio"
This prospectus is intended to provide information regarding the Contracts
offered by UNUM/America that you should know before investing. Please read and
retain this prospectus for future reference. A Statement of Additional
Information, dated May 1, 1996, has been filed with the Securities and Exchange
Commission and is available at no charge by writing or calling UNUM/America 2211
Congress Street, Portland, Maine 04122, (207) 770-2211, Attention: Retirement
Security Division.
TABLE OF CONTENTS
PAGE
----
DEFINITIONS 3
SUMMARY (INCLUDING FEE TABLE AND PERFORMANCE INFORMATION) 6
CONDENSED FINANCIAL INFORMATION 12
FINANCIAL STATEMENTS 13
UNUM/AMERICA, THE PROPOSED SALE, THE VARIABLE INVESTMENT
DIVISION AND THE FUNDS 13
CONTRACT PROVISIONS 18
DEDUCTIONS AND CHARGES 24
ANNUITY PERIOD 26
FEDERAL INCOME TAX CONSIDERATIONS 29
VOTING RIGHTS 32
OTHER CONTRACT PROVISIONS 32
GUARANTEED INTEREST DIVISION 35
TABLE OF CONTENTS FOR STATEMENT OF ADDITIONAL INFORMATION 36
2
<PAGE>
DEFINITIONS
ACCUMULATION UNIT: An accounting unit of measure used to record amounts of
increases to, decreases from and accumulations in each Sub-Account during the
Accumulation Period.
ACCUMULATION UNIT VALUE: The dollar value of an Accumulation Unit in each
Sub-Account on any Valuation Date.
ACCUMULATION PERIOD: The period commencing on a Participant's Participation Date
and terminating when the Participant's Account balance is reduced to zero,
either through withdrawal(s), conversion to an annuity, imposition of charges,
payment of a Death Benefit or a combination thereof.
ACQUISITION AGREEMENT: The Asset Transfer and Acquisition Agreement between
UNUM/America and Lincoln Life which provides for the sale of UNUM/America's
tax sheltered annuity business to Lincoln Life, the assumption of
UNUM/America's obligations under the Contracts (other than the New York
Contracts) by Lincoln Life, and the assumption of UNUM/America's obligations
under the New York Contracts by Lincoln-NY.
ANNUITANT: The person receiving annuity payments under the terms of the
Contract.
ANNUITY COMMENCEMENT DATE: The date on which UNUM/America makes the first
annuity payment to the Annuitant as required by the Retired Life Certificate.
ANNUITY CONVERSION AMOUNT: The amount applied toward the purchase of an annuity.
ANNUITY PERIOD: The period concurrent with or following the Accumulation Period,
during which an Annuitant's annuity payments are made.
BENEFICIARY: The person(s) designated to receive a Participant's Account balance
in the event of the Participant's death during the Accumulation Period or the
person(s) designated to receive any applicable remainder of an annuity in the
event of the Annuitant's death during the Annuity Period.
BUSINESS DAY: A day on which UNUM/America and the New York Stock Exchange are
customarily open for business.
CLOSING DATE: The date of closing as provided in the Acquisition Agreement.
CONTRIBUTIONS: All amounts deposited under a Contract, including any amount
transferred from another contract or Trustee.
CONTRACT: A Group Variable Annuity contract issued by UNUM/America to the
Contractholder.
CONTRACTHOLDER: The party named as the Contractholder on the group annuity
contract issued by UNUM/America. The Contractholder may be an Employer, a
retirement plan trust, an association or any other entity allowed under the law.
DIVISION(S): The Guaranteed Interest Division and/or the Variable Investment
Division.
EMPLOYER: The organization specified in the Contract which offers the Plan to
its employees.
FUNDS: The underlying funds in which the Sub-Accounts invest. Funds are
investment vehicles which offer their shares only to insurance companies'
separate accounts.
GENERAL ACCOUNT: All assets of UNUM/America other than those in the Variable
Investment Division or any other separate account.
GROSS WITHDRAWAL AMOUNT: The amount by which a Participant's Account is reduced
when a withdrawal occurs, including any applicable Annual Administration Charge.
3
<PAGE>
GUARANTEED ANNUITY: An annuity for which UNUM/America guarantees the amount of
each payment for as long as the annuity is payable.
GUARANTEED INTEREST DIVISION: The Division maintained by UNUM/America for the
Contracts and other contracts for which UNUM/America guarantees the principal
amount and interest credited thereto subject to any fees and charges as set
forth in the Contract. Amounts allocated to the Guaranteed Interest Division are
part of the General Account.
LINCOLN LIFE: The Lincoln National Life Insurance Company.
LINCOLN-NY: A New York domestic life insurance company (which may have a
different name) to be established by Lincoln Life as a subsdiary prior to the
closing date as contemplated by the Acquisition Agreement.
LNC: Lincoln National Corporation
NET CONTRIBUTIONS: The sum of all Contributions credited to a Participant
Account less any Net Withdrawal Amounts, outstanding loan (including principal
and due and accrued interest) and amounts converted to a Payout Annuity.
NET WITHDRAWAL AMOUNT: The amount paid when a withdrawal occurs.
NEW YORK CONTRACTS: Contracts originally issued in New York by UNUM Life
Insurance Company and which are now issued through UNUM/America.
PARTICIPANT: An employee or other person affiliated with the Contractholder on
whose behalf an Account is maintained under the terms of the Contract.
PARTICIPANT ACCOUNT: An account maintained for a Participant during the
Accumulation Period the total balance of which equals the Participant's Account
balance in the Variable Investment Division plus the Participant's Account
balance in the Guaranteed Interest Division.
PARTICIPATION ANNIVERSARY: For each Participant, a date at one year intervals
from the Participant's Participation Date. If an anniversary occurs on a
non-Business Day, it is treated as occurring on the next Business Day.
PARTICIPATION DATE: A date assigned to each Participant corresponding to the
date on which the first Contribution on behalf of that Participant is received
by UNUM/America. A Participant will receive a new Participation Date if such
Participant makes a Total Withdrawal, as defined in this prospectus, and
Contributions on behalf of the Participant are resumed under any Contract.
PARTICIPATION YEAR: A period beginning with one Participation Anniversary and
ending the day before the next Participation Anniversary, except for the first
Participation Year which begins with the Participation Date.
PAYOUT ANNUITY: A series of payments paid under the terms of a Contract to a
person. A Payout Annuity may be either a Guaranteed Annuity or a Variable
Annuity.
PLAN: The retirement program offered by an Employer to its employees for which a
Contract is used to accumulate funds.
SUB-ACCOUNT: An account established in the Variable Investment Division which
invests in shares of a corresponding Fund.
UNUM/AMERICA: UNUM Life Insurance Company of America, at its home office in
Portland, Maine.
4
<PAGE>
VALUATION DATE: A Business Day. Accumulation Units and Annuity Units are
computed as of the close of trading on the New York Stock Exchange.
VALUATION PERIOD: A period used in measuring the investment experience of each
Sub-Account. The Valuation Period begins at the close of trading on the New York
Stock Exchange on one Valuation Date and ends at the corresponding time on the
next Valuation Date.
VARIABLE ANNUITY: An annuity with payments that increase or decrease in
accordance with the investment results of the selected Sub-Accounts.
VARIABLE INVESTMENT DIVISION: The Division which is maintained by UNUM/America
for these Contracts and other UNUM/America contracts for which UNUM/America does
not guarantee the principal amount or investment results. The Variable
Investment Division is the VA-I Separate Account which is a group of assets
segregated from the General Account whose income, gains and losses, realized or
unrealized, are credited to or charged against the Variable Investment Division
without regard to other income, gains or losses of UNUM/America. The Variable
Investment Division currently consists of nine Sub-Accounts. Additional
Sub-Accounts may be added in the future.
5
<PAGE>
SUMMARY
UNUM LIFE INSURANCE COMPANY OF AMERICA
UNUM/America is a life insurance company founded in Maine in 1966.
UNUM/America is a subsidiary of UNUM Holding Company and its wholly-owned parent
company, UNUM Corporation whose stock is traded on the New York Stock Exchange.
The consolidated assets of UNUM Corporation as of December 31, 1995 were $14.8
billion.
PROPOSED SALE
In January, 1996, UNUM Corporation announced that UNUM/America had
entered into an Acquisition Agreement, which provides for the sale of
UNUM/America's tax-sheltered annuity business to Lincoln Life, the assumption
of UNUM/America's obligations under the Contracts (other than the New York
Contracts) by Lincoln Life and the assumption of UNUM/America's obligations
under the New York Contracts by Lincoln-NY which will be established prior to
the Closing Date. The consummation of the transactions under the Acquisition
Agreement is subject to the receipt of certain regulatory approvals and other
conditions. It is anticipated that it will take approximately six to nine
months from the date of the Acquisition Agreement to obtain the necessary
regulatory approvals and to otherwise satisfy the conditions to the
consummation of the sale. There can be no assurance that such approvals will
be obtained or that such conditions will be satisfied and, thus, there can be
no assurance that the sale will occur.
Lincoln Life is a subsidiary of LNC, which is a publicly-owned company
whose stock is traded on the New York Stock Exchange. LNC had consolidated
assets of $63.7 billion as of December 31, 1995. See "Acquisition Agreement
with The Lincoln National Life Insurance Company."
CONTRACTS OFFERED
The Group Variable Annuity Contracts offered by this prospectus are
available to Employers and other entities to provide a way to accumulate funds
for retirement and to provide Payout Annuities. UNUM/America offers Contracts
designed to enable Participants and Employers to accumulate funds for retirement
programs meeting the requirements of the following Sections of the Internal
Revenue Code of 1986, as amended (the "Code"): 401(a), 403(b), 408, 457 and
other related Sections as well as for programs offering non-qualified annuities.
HOW CONTRIBUTIONS ARE MADE
Contributions under the Contract are deposited by the Contractholder.
Depending upon the type of Plan offered, Contributions may consist of salary
reduction Contributions, Employer Contributions or Participant post-tax
Contributions. Contributions are forwarded by the Contractholder to UNUM/America
and allocated among the two Divisions in accordance with information provided by
the Contractholder. See "Contract Provisions, Contributions under the Contract".
DIVISIONS OFFERED
Contributions may be allocated to the Guaranteed Interest Division or to the
Variable Investment Division or to both Divisions. The Variable Investment
Division currently consists of nine Sub-Accounts. A Contractholder may choose to
offer between zero and nine of the Sub-Accounts to its Participants under a
Contract. The Sub-Accounts invest their assets in shares of a corresponding
Fund. For a full description of the Funds, see the prospectuses for the Funds.
TRANSFERS BETWEEN DIVISIONS AND SUB-ACCOUNTS
During the Accumulation Period, a Participant or a Contractholder under
certain Plans may make transfers between and among Divisions and Sub-Accounts.
Certain Plans may limit the transfers in dollar amount, type of Contribution, or
frequency. Certain Plans may require Contractholder approval for a transfer. See
"Transfers between Divisions and Sub-Accounts".
6
<PAGE>
WITHDRAWALS AND DISTRIBUTIONS
During the Accumulation Period, a Participant may withdraw any part of their
account balance subject to the restrictions imposed by the Code and regulations
thereof and by the applicable Plan. With respect to Plans subject to Title I of
the Employee Retirement Income Security Act of 1974 (ERISA), the Contractholder
must authorize UNUM/America to process a withdrawal request by a Participant.
Withdrawal requests under Section 457 Plans must also be authorized by the
Contractholder. With respect to withdrawal requests by Participants under Plans
not subject to Title I of ERISA, certain Contracts may require that the
Participants must certify to UNUM/America that an eligible event under the Code
has occurred. Withdrawal and Distribution requests must be in writing and in a
form acceptable to UNUM/America.
Certain Plans are also subject to the distribution requirements under
Section 401(a)(9) of the Code including the incidental death benefit
requirements of Section 401(a)(9)(G). Certain transfers from one Qualified Plan
contract to another Qualified Plan contract are not subject to withdrawal
restrictions under the Code. Certain withdrawals are subject to a 10% Federal
Excise Tax for premature distributions. See "Federal Income Tax Considerations."
DEATH BENEFITS
The Contracts provide for a Death Benefit for a Participant who dies during
the Accumulation Period. See "Contract Provisions, Death Benefits."
PAYOUT ANNUITIES
As permitted by the applicable Plan, a Contractholder or a Participant who
requests a withdrawal or a Beneficiary of a deceased Participant may elect to
convert all or part of the Participant's Account balance or the Death Benefit,
as appropriate, to a Payout Annuity. UNUM/America offers both Guaranteed and
Variable Annuities. The range of annuity options available include life
annuities and annuities for a specific time period as well as others described
more fully in this prospectus. See "Annuity Period."
FREE-LOOK PROVISION
A Participant under a Section 403(b) or 408 Plan and certain Non-qualified
Plans has ten days, in most cases, from the date the Participant receives an
Active Life Certificate to notify UNUM/America in writing that the Participant
does not choose to participate under the Contract and to receive a return of
funds. See "Free-Look Period."
7
<PAGE>
FEE TABLE
The following table and examples, prescribed by the SEC, are included to
assist Contractholders and Participants in understanding the transaction and
operating expenses imposed directly or indirectly under the Contracts. The
standardized tables and examples assume the highest deductions possible under
the Contracts, whether or not such deductions actually would be made from a
Participant's Account.
CONTRACT RELATED TRANSACTION EXPENSES1/
Sales Load Imposed on Purchases: 0%
ANNUAL ADMINISTRATION CHARGE2/ $25
SEPARATE ACCOUNT ANNUAL EXPENSES
(as a percentage of average daily net assets)
Mortality and Expense Risk Charge: 1.20%
Other Charges: 0.00%
Total Separate Account
Annual Expenses: 1.20%
FUND EXPENSES6/
<TABLE>
<CAPTION>
(as a percentage of average daily net assets) TO BE PROVIDED BY AMENDMENT
Index3/ G-I AMgr4/ G-II Bal Int'l Soc Res Eql SmCap
----- --- ---- ---- --- ----- ------- --- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Management Fees:
Other Expenses (after expense reimbursements):
Total Fund Expenses:
</TABLE>
8
<PAGE>
Example #1: Assuming total withdrawal of the Participant's Account balance
at the end of the period shown.5/
A $1,000 investment would be subject to the expenses shown, assuming 5%
annual return on assets.
<TABLE>
<CAPTION>
TO BE PROVIDED BY AMENDMENT
Index G-I AMgr G-II Bal Int'l Soc Res Eql SmCap
----- --- ---- ---- --- ----- ------- --- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 Year
3 Years
5 Years
10 Years
</TABLE>
Example #2: Assuming annuitization of the Contract at the end of the period
shown.
A $1,000 investment would be subject to the expenses shown, assuming 5% annual
return on assets.
<TABLE>
<CAPTION>
TO BE PROVIDED BY AMENDMENT
Index G-I AMgr G-II Bal Int'l Soc Res Eql SmCap
----- --- ---- ---- --- ----- ------- --- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 Year
3 Years
5 Years
10 Years
</TABLE>
Example #3: Assuming persistency of the Contracts through the periods shown.
A $1,000 investment would be subject to the expenses shown, assuming 5% annual
return on assets.
<TABLE>
<CAPTION>
TO BE PROVIDED BY AMENDMENT
Index G-I AMgr G-II Bal Int'l Soc Res Eql SmCap
----- --- ---- ---- --- ----- ------- --- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 Year
3 Years
5 Years
10 Years
</TABLE>
For purposes of these Examples, the effect of the Annual Administration
Charge has been computed based on both the (i) aggregate amount of Annual
Administration Charges collected during the most recent fiscal year and (ii) the
total average net assets attributable to the Contracts during that year.
_____
1/ Premium taxes are not shown. UNUM/America deducts the amount of premium
taxes, if any, when paid. Loans taken by a Participant with respect to the
Participant's Account balance in the Guaranteed Interest Division may be subject
to a charge for establishing the loan.
2/ The Employer has the option of paying the Annual Administration charge on
behalf of the Participants under a Contract. In such a situation, the projected
expenses would be lower than those indicated in the examples. This charge is not
imposed during the Annuity Period. In certain situations the Annual
Administrative Charge may be reduced or eliminated. See "Deductions &
Charges_Annual Administrative Charge".
9
<PAGE>
3/ Total Fund Operating Expenses, excluding brokerage commissions and
transaction fees, are guaranteed not to exceed .40% of the Dreyfus Stock Index
Fund, Inc.'s average daily net assets. To the extent these Fund expenses exceed
.40% of the Fund's average daily net assets, The Dreyfus Corporation, the Fund's
administrator, will bear such excess expense. For the fiscal year ending
December 31, 1995, the excess expense was .03%.
4/ A portion of the brokerage commissions the fund paid was used to reduce its
expenses. Without this reduction, total operating expenses would have been:
Asset Manager-0.81%
5/ The Contracts are designed for retirement planning. Withdrawals prior to
retirement or the Annuity Commencement Date are not consistent with the
long-term purposes of the Contracts and the applicable tax laws.
6/ Until complete order instructions are received, initial Contributions may
be allocated temporarily to Fidelity's Variable Insurance Products Fund: Money
Market Portfolio ("VIPF Money Market Portfolio"). Management fees for this fund
are 0.24%. Other expenses are 0.09%. Total Fund Expenses are 0.33%. The
Mortality and Expense Risk Charge is not assessed.
The fee table and examples reflect estimated expenses and charges of both
the Sub-Accounts and the applicable Fund. However, the examples should not be
considered a representation of past or future expenses and charges of the
Sub-Accounts or the Funds. Similarly, the assumed 5% annual rate of return is
not an estimate or a guarantee of future investment performance. See "Deductions
and Charges" in this prospectus and the discussion of Fund Management in the
prospectus for each of the Funds for further information.
PERFORMANCE INFORMATION
From time-to-time the Variable Investment Division may advertise or use in
sales literature information concerning the investment performance of the
various Sub-Accounts. No performance presentation should be considered as
representative of future investment results. Actual performance is a function
not only of the investment management of the underlying Funds and market forces,
but of the time and frequency of Contributions, the charges and fees imposed
under the Contract, the fees and expenses of the Funds, and transfers made by a
Participant, among other factors.
The investment performance of the Sub-Accounts may be advertised in
comparison with the performances of other variable annuities, other investment
companies (such as mutual funds), and recognized indices (such as the Dow Jones
Industrial Average, Standard & Poor's 500 Composite Stock Price Index, NASDAQ
Index, Consumer Price Index), and data published by Lipper Analytical
Services, Inc., Morningstar, and Variable Annuity Research and Data Service or
comparable services. Performance of the Sub-Accounts may also be compared with
performance of other types of investments. Some advertisements may also include
published editorial comments and performance rankings by independent
organizations and publications that monitor the performance of separate accounts
and mutual funds.
The Sub-Accounts may advertise average annual total return performance
information according to the SEC standardized formula. Average annual total
return shows the average annual percentage increase, or decrease, in the value
of a hypothetical $1,000 contribution allocated to a Sub-Account from the
beginning to the end of each specified period of time. The SEC standardized
formula gives effect to all applicable charges under the Contracts. This method
of calculating performance further assumes that (i) a $1,000 contribution was
allocated to a Sub-Account, (ii) no transfers or additional payments were made
and (iii) the withdrawal of the investment occurs at the end of the period.
Premium taxes are not
10
<PAGE>
included in the term "charges" for purposes of this calculation. The
Sub-Accounts may also advertise this total return performance as described above
on a cumulative basis.
The Sub-Accounts may present total return information computed on a
calendar year basis. The Sub-Accounts may also present total return
information over specified periods of time (computed on an average annual or
cumulative basis) assuming that no administrative charge will be deducted.
The Sub-Accounts may present hypothetical examples that apply the total
return to a hypothetical initial investment. The Sub-Accounts may also
present total return information based on different amounts of periodic
investments. For additional performance information, please refer to the
Statement of Additional Information.
PUBLISHED RATINGS
From time to time, in advertisements or in reports to Contractholders,
UNUM/America may reflect endorsements. Endorsements are often in the form of a
list of organizations, individuals or other parties which recommend UNUM/America
or the Contracts. The endorser's name will be used only with the endorser's
consent. It should be noted that the list of endorsements may change from time
to time.
Also, from time to time, the rating of UNUM/America as an Insurance company
by A.M. Best may be referred to in advertisements or in reports to
Contractholders. Each year the A.M. Best Company reviews the financial status of
thousands of Insurers, culminating in the assignment of Best's Ratings. These
ratings reflect their current opinion of the relative financial strength and
operating performance of an insurance company in comparison to the norms of the
life/health insurance Industry. Best's ratings range from A++ to F. An A++
rating means, in the opinion of A.M. Best, that the insurer has demonstrated the
strongest ability to meet its respective policyholder and other contractual
obligations. UNUM/America's A.M. Best rating is A++ (May 1995) which is
defined as "Superior."
In addition, the claims-paying ability of UNUM/America as measured by the
Standard and Poor's Rating Group may be referred to in advertisements or in
reports to Contractholders. A Standard and Poor's insurance claims-paying
ability rating is an assessment of an operating insurance company's financial
capacity to meet the obligations of its insurance policies in accordance with
their terms. Standard and Poor's ratings range from AAA to CCC. UNUM/America's
claims-paying rating is AA (February 1996) which is defined as "Excellent."
From time to time UNUM/America may refer to Moody's Investors Service
rating of UNUM/America. Moody's Investors Service financial strength ratings
indicate an insurance company's ability to discharge policyholder obligations
and claims and are based on an analysis of the insurance company and its
relationship to its parent, subsidiaries, and affiliates. Moody's Investors
Service ratings range from Aaa to C. UNUM/America's financial strength rating is
Aa2 (March 1995) which is defined as "Excellent."
11
<PAGE>
CONDENSED FINANCIAL INFORMATION
The financial data included below should be read in conjunction with the
financial statements and the related data included in the Statement of
Additional Information.
ACCUMULATION UNIT VALUES
<TABLE>
<CAPTION>
(For an accumulation unit outstanding throughout the period)
SUB-ACCOUNT 1989 1990 1991 1992 1993 1994 1995
----------- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Index Account
December 12 Commencement $9.9060
Beginning of Period $9.9629 $9.4953 $12.1814 $12.8906 $13.9245 $13.8792
End of Period $9.9629 $9.4953 $12.1814 $12.8906 $13.9245 $13.8792 $18.7565
Growth I Account
May 1 Commencement $10.00
Beginning of Period $12.1759 $13.1505 $15.5094 $15.3208
End of Period $12.1759 $13.1505 $15.5094 $15.3208 $20.4909
Growth II Account
May 1 Commencement $10.00
Beginning of Period $11.5975 $11.3049 $12.3212 $12.0313
End of Period $11.5975 $11.3049 $12.3212 $12.0313 $15.5840
Asset Manager Account
May 1 Commencement $10.00
Beginning of Period $10.7598 $11.8933 $14.2241 $13.1979
End of Period $10.7598 $11.8933 $14.2241 $13.1979 $15.2510
Balanced Account
May 1 Commencement $10.00
Beginning of Period $12.4515 $11.5582 $12.2957 $12.2225
End of Period $12.4515 $11.5582 $12.2957 $12.2225 $14.6286
International Stock
May 1 Commencement $10.00
Beginning of Period $9.8622
End of Period $9.8622 $10.8333
Socially Responsible
May 1 Commencement $10.00
Beginning of Period $9.9692
End of Period $9.9692 $12.7827
Equity-Income
May 1 Commencement $10.00
Beginning of Period $10.4780
End of Period $10.4780 $13.9856
Small Cap
May 1 Commencement $10.00
Beginning of Period $10.3818
End of Period $10.3818 $13.2713
Pending Allocation Account
October 15 Commencement $10.00
Beginning of Period $10.1054
End of Period $10.1054 $10.6938
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<PAGE>
<CAPTION>
Number of Accumulation Units Outstanding at end of Period
1989 1990 1991 1992 1993 1994 1995
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Index Account 0 72,405 296,075 836,187 1,526,878 1,929,447 2,395,545
Growth I Account 5,166 317,275 1,340,146 3,071,862 4,459,417
Growth II Account 53,904 566,562 1,242,216 1,733,360 2,191,475
Asset Manager Account 36,645 462,405 2,232,731 4,369,937 4,882,920
Balanced Account 13,453 282,439 673,424 1,041,814 1,294,883
Socially Responsible Account 26,073 133,871
Equity-Income Account 320,659 1,529,172
International Stock Account 354,936 803,485
Small Cap Account 400,376 1,461,575
Pending Allocation Account 11,980 21,372
<CAPTION>
Number of Fund Shares held by each of the corresponding Sub-Accounts as of December 31st of each year
1989 1990 1991 1992 1993 1994 1995
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Dreyfus Stock Index Fund 0 58,271 241,984 703,885 1,611,415 2,070,026 2,613,187
Fidelity's Variable Insurance Products Fund: 0 0 3,399 211,238 900,965 2,170,399 3,130,382
Growth Portfolio
Twentieth Century's TCI Portfolios, Inc. 0 0 72,384 756,506 1,642,987 2,264,937 2,832,766
TCI Growth Portfolio
Fidelity's Variable Insurance Products Fund II: 0 0 31,429 412,427 2,060,497 4,183,403 4,717,794
Asset Manager's Portfolio
Twentieth Century's TCI Portfolios, 0 0 27,075 568,960 1,364,740 2,137,066 2,691,551
Inc. TCI Balanced
Calvert Responsibly Invested Balanced Portfolio 0 0 0 0 0 180,421 1,005,155
Fidelity's Variable Insurance Products Fund: 0 0 0 0 0 218,939 1,110,190
Equity-Income Portfolio
T. Rowe Price International Stock Portfolio 0 0 0 0 0 343,942 773,288
Dreyfus Variable Investment Fund: 0 0 0 0 0 113,847 420,623
Small Cap Portfolio
Fidelity's Variable Insurance Products Fund: 0 0 0 0 0 121,067 228,610
Money Market Portfolio
</TABLE>
FINANCIAL STATEMENTS
The financial statements of the Variable Investment Division and of
UNUM/America may be found in the Statement of Additional Information.
UNUM/AMERICA, THE PROPOSED SALE, THE VARIABLE INVESTMENT DIVISION AND THE FUNDS
UNUM LIFE INSURANCE COMPANY OF AMERICA
UNUM/America is a life insurance company chartered under Maine law in 1966.
On November 18, 1986, UNUM/America's name was changed from Unionmutual Stock
Life Insurance Company of America to UNUM Life Insurance Company of America. On
December 31, 1991, UNUM/America was merged with UNUM Life Insurance Company and
UNUM Pension and Insurance Company, with the surviving company being UNUM Life
Insurance Company of America. UNUM/America's principal executive offices are
located at 2211 Congress Street, Portland, Maine 04122. UNUM/America's
telephone number is (207) 770-2211. UNUM/America provides a broad line of
disability, health and life insurance products, in addition to group retirement
products. UNUM/America is currently licensed to issue variable contracts in
49 states and the District of Columbia. Administrative services necessary for
the operation of the Variable Investment Division and the Contracts are
currently provided by UNUM/America. See "Deductions and Charges_Annual
Administration Charge."
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UNUM/America is a subsidiary of UNUM Holding Company and its wholly-owned
parent company, UNUM Corporation. UNUM Corporation was organized under Delaware
law on January 11, 1985. UNUM Corporation is a publicly-owned company whose
stock is traded on the New York Stock Exchange. UNUM Corporation has
consolidated assets of $14.8 billion as of December 31, 1995.
ACQUISITION AGREEMENT WITH
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY
In January, 1996, UNUM Corporation announced that UNUM/America had
entered into an Acquisition Agreement, which provides for the sale of
UNUM/America's tax-sheltered annuity business to Lincoln Life, the assumption
of UNUM/America's obligations under the Contracts (other than the New York
Contracts) by Lincoln Life, and the assumption of UNUM/America's obligations
under the New York Contracts by Lincoln-NY which will be established prior to
the Closing Date. The consummation of the transactions under the Acquisition
Agreement is subject to the receipt of certain regulatory approvals and other
conditions. It is anticipated that it will take approximately six to nine
months from the date of the Acquisition Agreement to obtain the necessary
regulatory approvals and to otherwise satisfy the conditions to the
consummation of the sale. There can be no assurance that such approvals will
be obtained or that such conditions will be satisfied and, thus, there can be
no assurance that the sale will occur.
Lincoln Life is a subsidiary of LNC, which is a publicly-owned company
whose stock is traded on the New York Stock Exchange. LNC had consolidated
assets of $63.7 billion as of December 31, 1995.
Until the Closing Date UNUM/America will continue to offer the Contracts
described in this prospectus. Until the Closing Date, UNUM/America will also
continue to administer all current Contracts, enroll new Participants, and
accept new Contributions from current Participants - all in accordance with the
applicable Contract and this prospectus.
The Acquisition Agreement provides that beginning on the Closing Date,
Lincoln Life will administer the Contracts on behalf of UNUM/America pursuant
to an administrative services agreement.
In addition, after the Closing Date, UNUM/America and Lincoln Life
intend to notify Contractholders and/or Participants regarding the assumption
of their Contracts (other than New York Contracts) by Lincoln Life or, in the
case of the New York Contracts, by Lincoln-NY. This notification process is
subject to state regulatory requirements and may vary from state to state,
but UNUM/America and Lincoln Life intend, unless otherwise required, to first
notify each Contractholder regarding the assumption. In some states the
Contractholder will be deemed to have consented to the assumption if it does
not opt out within a certain time period. In other states affirmative
consent will be sought. If the Contractholder opts out of the assumption (or
refuses to consent where affirmative consent is required) UNUM/America will
remain as the insurer of the Contract and Participants under that Contract
will not be given the opportunity to have their certificates assumed by
Lincoln Life. Whether or not a Contract is assumed by Lincoln Life, it will
be administered by Lincoln Life. If the Contractholder consents to the
assumption or is deemed to have consented to the assumption, as applicable,
UNUM/America and Lincoln Life intend to notify each Participant under the
Contract regarding the assumption and provide each Participant an opportunity
to opt out. (If required, affirmative Participant consent will be sought.)
If, under a Contract some Participants opt out and some do not, the Contract
will be bifurcated - one Contract will have UNUM/America as the insurer and
the other will have Lincoln Life as the insurer (or, for the New York
Contracts, Lincoln-NY). Both Contracts, however, will be administered by
Lincoln Life. As noted above, the notification process is subject to
regulatory requirements which vary from state to state. Thus the
notification procedures employed by UNUM/America and Lincoln Life may vary
from those described above. In any event, Contractholders and/or Participants
will receive all notifications and be given all consent and opt out rights
required by law.
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<PAGE>
Assuming that an assumption is approved under the above procedures,the
effect of the assumption is to substitute Lincoln Life for
UNUM/America as the insurer. (For the New York Contracts, Lincoln-NY will be
the insurer.) In addition, a Participant's Account balance in the Variable
Investment Division will be transferred to a Lincoln Life or Lincoln-NY
separate account as of the effective date of the assumption of the
obligations to the Participant under the Contract by Lincoln Life or
Lincoln-NY. UNUM/America and Lincoln Life intend that the Lincoln Life and
Lincoln-NY separate accounts will invest in the same underlying Funds as the
Sub-Accounts of UNUM/America's Variable Investment Division. Except for the
substitution of Lincoln Life or Lincoln-NY for UNUM/America as the insurer
under the Contracts and the transfer of Account balances to the Lincoln Life
or Lincoln-NY separate account, the rights of Contractholders and
Participants under the Contracts will not change solely as a result of the
assumption. There will be no adverse tax consequences to Contractholders or
Participants as a result of the transfer. See "Federal Income Tax
Considerations."
UNUM/America and Lincoln Life currently expect that UNUM/America will
continue to offer the Contracts after the Closing Date in those states where
Lincoln Life has not yet received all the approvals necessary to sell its own
Contract. While such Contracts would be issued by UNUM/America, Contractholders
and/or Participants will be required to agree, at the time such Contracts are
issued, to an automatic transfer of such Contracts to Lincoln Life at such time
as Lincoln Life receives the necessary approvals to sell its own contracts.
UNUM/America anticipates that it will continue to sell Contracts on this basis
for no more than eighteen months after the Closing Date.
In the event that, after the Closing Date, UNUM/America offers contracts that
will be automatically assumed by Lincoln Life, Contractholders and Participants
will receive, at the time the Contract is offered or sold to them, a prospectus
or other disclosures pertaining to Lincoln Life.
UNUM SALES CORPORATION
UNUM Sales Corporation (UNUM/Sales), a subsidiary of UNUM Corporation, is
the principal underwriter of the Contracts. As such, UNUM/Sales will be offering
the Contracts and performing all duties and functions that are necessary and
proper for the distribution of the Contracts. UNUM/Sales has also entered into
acquisition agreements with independent broker-dealers for the sale of the
Contracts. UNUM/Sales' principal business office is at 2211 Congress Street,
Portland, Maine 04122.
Lincoln Life, a registered broker-dealer, has agreed to serve as the
principal underwriter of the Contracts as of the Closing Date. Accordingly,
it is expected that, on and after the Closing Date, Lincoln Life will be
offering the Contracts and performing all duties and functions that are
necessary and proper for the distribution of the Contracts. It is
anticipated that Lincoln Life will enter into sales agreements with
independent broker-dealers for the sale of the Contracts. Lincoln Life's
principal business address is 1300 South Clinton Street, Fort Wayne, Indiana
46802.
THE VARIABLE INVESTMENT DIVISION
On December 31, 1991, pursuant to the merger of UNUM Life Insurance Company
and UNUM Pension and Insurance Company into UNUM/America, the Variable
Investment Division was transferred intact to UNUM/America. Prior to that, on
July 8, 1988, the Board of Directors of UNUM Life Insurance Company authorized
the establishment of the Variable Investment Division called the TSAVA Separate
Account in accordance with the Maine Insurance Code. On February 7, 1991, the
Board of Directors of UNUM Life Insurance Company expanded the scope of the
Variable Investment Division and changed its name to the VA-I Separate Account.
Under Maine law, the funds in the Variable Investment Division are owned by
UNUM/America and UNUM/America is not, nor can UNUM/America be, a trustee with
respect to those funds. The Variable Investment Division is registered with the
Securities and Exchange Commission ("SEC") as a unit investment trust under the
Investment Company Act of 1940 ("1940 Act"). Registration with the SEC does not
involve supervision of the management or investment practices or policies of
either the Variable Investment Division or UNUM/America by the SEC.
The Variable Investment Division currently consists of nine Sub-Accounts.
The Sub-Accounts invest in shares of the Funds. Therefore, the investment
experience of the Sub-Accounts depends on the performance of the Funds.
The income, gains and losses, realized or unrealized, from assets
allocated to the Variable Investment Division are credited to or charged
against the Variable Investment Division, without regard to other income,
gains or losses in UNUM/America's general account or any other separate
account. The Contract provides that the assets of the Variable Investment
Division may not be charged with liabilities arising out of any other
business of UNUM/America. UNUM/America may accumulate in the Variable
Investment Division proceeds from charges under the Contract and other
15
<PAGE>
amounts in excess of the Variable Investment Division assets representing
Contract reserves and liabilities. UNUM/America is the issuer of the
Contracts and the obligations set forth therein, other than those of the
Contractholder or the Participant, are UNUM/America's. As noted previously,
however, UNUM/America has entered into an agreement providing for the
assumption of UNUM/America's obligations under the Contracts (other than the
New York Contracts) by Lincoln Life or, in the case of the New York
Contracts, by Lincoln-NY. See "Acquisition Agreement With The Lincoln
National Life Insurance Company."
THE FUNDS
The nine Sub-Accounts invest directly in nine corresponding Funds. Each of
these Funds was formed as an investment vehicle for insurance company separate
accounts.
Information about each of the Funds, including their investment objectives
and investment management, is contained below. Additional information about the
Funds, their investment policies, risks, fees and expenses and all other aspects
of their operations, can be found in the prospectuses for the Funds, which
should be read carefully before investing. Additional copies of the Funds'
prospectuses, as well as their Statements of Additional Information, can be
obtained directly from each of the Funds without charge by writing to the
particular Funds at the addresses noted on the front of the prospectus. Shares
of the Funds are sold not only to the Sub-Accounts but also to variable annuity
and variable life separate accounts of other insurance companies. For a
disclosure of possible conflicts involved in the Sub-Accounts investing in Funds
that are so offered, see the applicable Fund prospectus.
On the effective date of a Participant's transfer to Lincoln Life,
the Participant's Account balance in the Variable Investment Division will
be transferred to a Lincoln Life separate account., For Participants under
the New York Contracts, the Account balances will be transferred to a
Lincoln-NY separate account. UNUM/America and Lincoln Life intend that the
Lincoln Life separate account and the Lincoln-NY separate account will each
have nine Sub-Accounts which will invest in the same nine Funds currently
offered by UNUM/America's Variable Investment Division. Any deletion of
Funds or substitution of different Funds would require regulatory approval.
Additional Funds may nevertheless be added or deleted in the future.
"DREYFUS STOCK INDEX FUND"
Dreyfus Stock Index Fund is an open-end, non-diversified management
investment company known as an index fund. Its goal is to provide investment
results that correspond to the price and yield performance of publicly traded
common stocks in the aggregate, as represented by the Standard & Poor's 500
Composite Stock Price Index. The Fund is neither sponsored by nor affiliated
with Standard & Poor's Corporation. The Fund sells its shares to the Index
Account at net asset value, without the imposition of a sales charge.
The Dreyfus Corporation, located at 200 Park Avenue, New York, New York
10166, acts as the Fund manager and Mellon Equity Associates, an affiliate of
Dreyfus located at 500 Grant Street, Pittsburgh, Pennsylvania 15258, is the Fund
index manager.
"CALVERT RESPONSIBLY INVESTED BALANCED PORTFOLIO"
The Calvert Responsibly Invested Balanced Portfolio is a series of Acacia
Capital Corporation (the "Fund"), an open-end management investment company
whose investment advisor is Calvert Asset Management Company, Inc. located at
4550 Montgomery Avenue, Suite 1000N, Bethesda, Maryland 20814.
The Calvert Responsibly Invested Balanced Portfolio seeks
16
<PAGE>
total return above the rate of inflation through an actively managed,
nondiversified portfolio of common and preferred stocks, bonds, and money market
instruments which offer income and growth opportunity and which satisfy the
social concern criteria established for the Portfolio. Shares of the Fund are
offered only to insurance companies for allocation to certain of their variable
accounts.
"DREYFUS VARIABLE INVESTMENT FUND"
Dreyfus Variable Investment Fund is an open-end, diversified management
investment company that is intended to be a funding vehicle for variable annuity
contracts and variable life insurance policies to be offered by the separate
accounts of various life insurance companies.
THE SMALL CAP PORTFOLIO: The Portfolio seeks to maximize capital appreciation.
The Small Cap Portfolio seeks out companies that The Dreyfus Corporation
believes have the potential for significant growth. Under normal market
conditions, the Portfolio will invest at least 65% of its total assets in
companies with market capitalization of less than $750 million, at the time of
purchase, both domestic and foreign where there is a belief that new or
innovative products or services should enhance prospects for growth in future
earnings. The Portfolio may also invest in special situations such as corporate
restructurings, mergers or acquisitions.
The Dreyfus Corporation, located at 200 Park Avenue, New York, New York
10166, serves as the Fund's investment adviser.
FIDELITY'S "VARIABLE INSURANCE PRODUCTS FUND"
The Variable Insurance Products Fund was designed to provide investment
vehicles for variable annuity and variable life insurance contracts of various
insurance companies.
EQUITY-INCOME PORTFOLIO: The Portfolio seeks reasonable income by normally
investing at least 65% of its total assets in income-producing common or
preferred stock and the remainder in debt securities.
GROWTH PORTFOLIO: The Portfolio seeks to achieve capital appreciation. The
Portfolio normally purchases common stocks, although its investments are not
restricted to any one type of security. Capital appreciation may also be found
in other types of securities, including bonds and preferred stocks.
MONEY MARKET PORTFOLIO: The Portfolio seeks to obtain as high a level of current
income as is consistent with preserving capital and providing liquidity. For
more information regarding the Portfolio, into which initial Contributions are
invested pending UNUM/America's receipt of a complete order, please see the
"Initial Contributions" section.
Fidelity Management & Research Company ("FMR") is the manager of the
Equity-Income Portfolio, the Growth Portfolio and the Money Market Portfolio and
is located at 82 Devonshire Street, Boston, Massachusetts 02109.
FIDELITY'S "VARIABLE INSURANCE PRODUCTS FUND II"
Variable Insurance Products Fund II is designed to provide investment
vehicles for variable annuity and variable life insurance contracts.
ASSET MANAGER PORTFOLIO: The Portfolio seeks high total return with reduced risk
over the long term by allocating its assets among domestic and foreign stocks,
bonds and short-term fixed income instruments.
FMR is the manager of the Portfolio and is located at 82 Devonshire Street,
Boston, Massachusetts 02109.
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<PAGE>
TWENTIETH CENTURY'S "TCI PORTFOLIOS, INC."
TCI Portfolios, Inc. is a fund which offers its shares only to insurance
companies to fund the benefits of variable annuity or variable life insurance
contracts. The Portfolios are managed by Investors Research Corporation which
also manages the Twentieth Century family of mutual funds. Investors Research
Corporation has its principal place of business at Twentieth Century Tower, 4500
Main Street, Kansas City, Missouri 64111.
UNUM/America may perform certain administrative services that would
otherwise be performed by Twentieth Century Services, Inc., and Investors
Research may pay UNUM/America for such services.
TCI GROWTH: The Portfolio seeks capital growth by investing in common stocks
(including securities convertible into common stocks) and other securities that
meet certain fundamental and technical standards of selection and, in the
opinion of the fund's management, have better than average potential for
appreciation.
TCI BALANCED: The Portfolio seeks capital growth and current income. Its
investment team intends to maintain approximately 60% of the portfolio's assets
in common stocks that are considered by its manager to have better than average
prospects for appreciation and the balance in bonds and other fixed income
securities.
"T. ROWE PRICE INTERNATIONAL SERIES, INC."
T. Rowe Price International Series is a fund which offers its shares only
to insurance companies to fund the benefits of variable annuity and variable
life contracts. It is managed by Rowe Price-Fleming International, Inc., one of
America's largest international no load mutual fund managers with approximately
$20.0 billion under management as of December 31, 1995, from its offices in
Baltimore, London, Tokyo and Hong Kong.
The International Stock Portfolio seeks long-term growth of capital
through investments primarily in common stocks of established, non-U.S.
companies.
CONTRACT PROVISIONS
GENERAL
UNUM/America has designed these Contracts for Employers and other entities
to enable Participants and Employers to accumulate funds for retirement programs
meeting the requirements of the following Sections of the Internal Revenue Code
of 1986, as amended (the "Code"): 401(a), 403(b), 408, 457 and other related
Sections as well as for programs offering non-qualified annuities. An Employer,
Association or trustee in some circumstances, may enter into a Contract with
UNUM/America by filling out an application and returning it to UNUM/America.
Upon UNUM/America's acceptance of the application, Contractholders or an
affiliated Employer can forward Contributions on behalf of employees who then
become Participants under the Contracts. For Plans that have allocated rights to
the Participant, UNUM/America will issue to each Participant a separate Active
Life Certificate that describes the basic provisions of the Contract to each
Participant.
CONTRIBUTIONS UNDER THE CONTRACT
Generally, under the Contracts, Contributions are forwarded by the
Contractholders to UNUM/America for investment. Depending on the Plan, the
Contributions may consist of salary reduction Contributions, Employer
Contributions or post-tax Contributions. Lincoln Life will administer the
Contracts after the Closing Date. Contractholders will be notified of any
change in procedures.
Contributions may accumulate on either a guaranteed or variable basis
depending upon the Divisions available under the Contract and/or the Division in
which the Contributions are deposited. Contributions to the Guaranteed Interest
Division become part of UNUM/America's General Account and are guaranteed a
minimum rate of interest.
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UNUM/America will also declare in advance a guaranteed interest rate which will
be effective for all amounts in the Participant's Account balance in the
Guaranteed Interest Division during the designated year. This rate will never be
less than the minimum rate of interest. UNUM/America may also declare in advance
separate interest rate guarantees which are in excess of the guaranteed interest
rate for some or all of the Participant's Account balance in the Guaranteed
Interest Division for specific period(s) during the designated year.
UNUM/America assumes the risk of investment gain or loss on contributions to the
Guaranteed Interest Division. Contributions to the Variable Investment Division
are credited with a rate of return dependent upon the investment experience of
the Sub-Accounts in which the Contributions are invested.
Contributions by Participants may be in any amount unless there is a
minimum amount set by the Contractholder or Plan. A Contract may require the
Contractholder to contribute a minimum annual amount on behalf of all
Participants. Annual Contributions under Qualified Plans may be subject to
maximum limits imposed by the Code. Annual Contributions under non-qualified
plans may be limited by the terms of the Contract. In the Statement of
Additional Information see "Tax Law Considerations" for a discussion of these
limits. Subject to any restrictions imposed by the Plan or the Code, transfers
from other contracts and qualified rollover Contributions will be accepted.
Section 830.205 of the Texas Education Code provides that Employer or state
Contributions (other than salary reduction Contributions) on behalf of
Participants in the Texas Optional Retirement Program ("ORP") vest after one
year of participation in the program. UNUM/America will return Employer
Contributions to the Contractholder for those employees who terminate employment
in all Texas institutions of higher education before becoming vested. During
this first participation year in the ORP, ORP Participants may only direct
Employer and state Contributions to the Guaranteed Interest Division.
Contributions must be in United States funds unless UNUM/America agrees in
writing to accept other currencies. Any non-US funds will be converted to U.S.
funds. All withdrawals and distributions under this Contract will be in U.S.
funds. If a bank or other financial institution does not honor the check or
other payment method constituting a Contribution, UNUM/America will treat the
Contribution as invalid. All allocation and subsequent transfers resulting from
the invalid Contributions shall be reversed and the party responsible for the
invalid Contribution shall reimburse UNUM/America for any losses or expenses
resulting from the invalid Contribution.
INITIAL CONTRIBUTIONS
The initial Contribution for a Participant will be credited to the
Participant's Account no later than two Business Days after it is received by
UNUM/America if it is preceded or accompanied by a completed enrollment form
containing all the information necessary for processing the Participant's
Contribution. If UNUM/America does not receive a complete enrollment form,
UNUM/America will notify the Contractholder or the Participant that UNUM/America
does not have the necessary information to process the Contribution. If the
necessary information is not provided to UNUM/America within five (5) Business
Days after UNUM/America first receives the initial Contribution, UNUM/America
will return the initial Contribution less any withdrawal(s) by the Participant
or by the Contractholder, unless the Participant or the Contractholder
specifically consents to UNUM/America retaining the Contribution until the
enrollment form is made complete.
Notwithstanding the above, when the Contract includes language regarding
the "Pending Allocation Account", the following shall apply: Where state
approval has been obtained, if UNUM/America receives Contributions which are not
accompanied by a properly completed Enrollment Form, UNUM/America will notify
the Contractholder of that fact and deposit the Contributions to the Pending
Allocation Account, unless such Contributions are designated to another Account
in accordance with the Plan. Within two business days of receipt of a properly
completed Enrollment Form, the Participant's Account balance in the Pending
Allocation Account will be transferred in accordance with the allocation
percentages elected on the Enrollment Form. All future Contributions will also
be allocated in accordance with these percentages until such time as the
Participant may notify UNUM/America of a change. If a properly completed
Enrollment Form is not received after three monthly notices have been sent, the
Participant's Account balance in the Pending Allocation Account will be refunded
to the Contractholder within 105 days of the date of the initial Contribution.
The Pending Allocation Account invests in Fidelity's Variable Insurance Products
Fund: Money Market Portfolio and is not available as an investment option under
the
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<PAGE>
group annuity contract. Mortality & Expense Risk Charges and the Annual
Administration Charge do not apply to this Account. These charges will be
applicable upon receipt of a properly completed Enrollment Form and the
Participant's contract Participation Date will be the date money was deposited
in the Pending Allocation Account.
ALLOCATION OF CONTRIBUTIONS
A Participant must designate in writing, subject to the Plan, the percent
of their Contribution which will be allocated to each Division and to each
Sub-Account available under their Contract. The Contributions allocation
percentage to the Guaranteed Investment Division or any Sub-Account can be in
any whole percent. Participants, whose Employer offers two or more UNUM/America
contracts for the same type of Qualified or Non-qualified Plans, may allocate
Contributions to a maximum of ten Sub-Accounts and Guaranteed Interest Division.
Participants, subject to the terms of the Plan, may change the allocation of
Contributions by notifying UNUM/America in writing or by telephone in accordance
with procedures published by UNUM/America. Telephone requests for allocation
changes follow the same verification of identity rules as for Transfers. (See
"Telephone Transfers.") When UNUM/America receives a notice in writing, the form
must be acceptable to UNUM/America. Upon receipt by UNUM/America, the change
will be effective for all Contributions received concurrently with the
allocation change form and for all future Contributions, unless a later date is
requested. Changes in the allocation of future Contributions have no effect on
amounts a Participant may have already contributed. Such amounts, however, may
be transferred between Divisions and Sub-Accounts pursuant to the requirements
described in "Transfers between Divisions and Sub-Accounts." Allocations of
employer contributions may be restricted by the applicable plan.
SUBSEQUENT CONTRIBUTIONS
The Contractholder will forward Contributions to UNUM/America specifying
the amount being contributed on behalf of each Participant. The Contractholder
must send Contributions and provide such allocation information in accordance
with procedures established by UNUM/America. The Contributions shall be
allocated among the Guaranteed Interest Division and the Variable Investment
Division in accordance with the Contractholder's or the Participant's written
instructions as described above in "Allocation of Contributions."
INVESTMENT OF CONTRIBUTIONS
Contributions are invested as of the date of receipt at UNUM/America,
provided that they are received on a Business Day and allocation information is
provided in a form acceptable to UNUM/America in accordance with procedures
established by UNUM/America. Contributions on behalf of a Participant which are
allocated to the Variable Investment Division will be credited with Accumulation
Units as of that date. A Participant's interest in the Variable Investment
Division during the Accumulation Period is represented by the value of the
Accumulation Units credited to the Participant's Account balance in the Variable
Investment Division. The number of Accumulation Units credited to a
Participant's Account in a Sub-Account is calculated by dividing the
Contribution allocated to the Sub-Account by the dollar value of an Accumulation
Unit next determined after receipt of the Contribution. The number of
Accumulation Units purchased will not vary as a result of any subsequent
fluctuations in the Accumulation Unit Value. The Accumulation Unit Value, of
course, fluctuates with the investment performance of the underlying Fund and
also reflects deductions and charges made against the Variable Investment
Division.
DETERMINATION OF ACCUMULATION UNIT VALUE
UNUM/America determines the Accumulation Unit Value of each Sub-Account on
each Valuation Date. The Accumulation Unit Values for all Sub-Accounts other
than the Index Account were initially set at ten dollars ($10). The Accumulation
Unit Value was initially set at $9.9060 for the Index Account. Subsequent
Accumulation Unit Values are determined by multiplying the Net Investment Factor
for the current Valuation Period by the Accumulation Unit Value as of the end of
the immediately preceding Valuation Period.
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UNUM/America uses a Net Investment Factor to measure the daily fluctuations
in value of a Sub-Account. The Net Investment Factor for any Valuation Period is
determined as follows:
(a) The net asset value per share of the underlying Fund as of the end of
a Valuation Period is added to the amount per share of any dividends or capital
gain distributions paid by the Fund during that Valuation Period;
(b) The amount in (a) above is then divided by the net asset value per
share of the underlying Fund as of the end of the immediately preceding
Valuation Period;
(c) The result of (a) divided by (b) is then multiplied by one minus the
annual mortality and expense risk charge to the n/365th power where n equals the
number of calendar days since the immediately preceding Valuation Date.
The above calculation will be adjusted by the amount per share of any taxes
which are incurred by UNUM/America because of the existence of the Variable
Investment Division.
The Participant's Account balance is equal to the sum of the Participant's
Account balances in both the Variable Investment Division and the Guaranteed
Interest Division.
TRANSFERS BETWEEN DIVISIONS AND SUB-ACCOUNTS
During the Accumulation Period, transfers may be made of all or part of a
Participant's Account balance in any Division or Sub-Account to another
Sub-Account or Division subject to the limitations described below and in the
applicable Plan. Transfers will not change the allocation of future
Contributions to the Divisions and Sub-Accounts. UNUM/America does not require
that any minimum amount be transferred. To effect a transfer, UNUM/America must
receive a written transfer request in a form acceptable to UNUM/America.
During any one calendar year, a Participant may make one transfer or
withdrawal from the Guaranteed Interest Division to the Variable Inestment
Division in an amount not to exceed 20% of The Guaranteed Interest Division
Account balance.
Transfers to or from the Variable Investment Division are made using the
Accumulation Unit Value next computed following UNUM/America's receipt of the
written transfer request.
TELEPHONE TRANSFERS BETWEEN DIVISIONS AND SUB-ACCOUNTS
UNUM/America may accept telephone transfers from Participants when this is
allowed by the Contractholder. In order to prevent unauthorized or fraudulent
transfers, UNUM/America will require a Participant to provide certain
identifying information before UNUM/America will act upon their instructions.
UNUM/America may also assign the Participant a Personal Identification Number
(PIN) to serve as identification. UNUM/America will not be liable for following
telephone instructions it reasonably believes are genuine. Telephone transfer
requests may be recorded and written confirmation of all transfer requests will
be mailed to the Participant or Contractholder on the next Business Day.
Telephone transfers will be processed on the Business Day that they are received
when they are received at the UNUM/America Home Office before 4:00 P.M. ET. If
the Participant or Contractholder determines that a transfer has been made in
error, the Participant or Contractholder must notify UNUM/America within 30 days
of the confirmation notice date. See "Contract Provisions, Transfers between
Divisions and Sub-Accounts."
WITHDRAWALS
During the Accumulation Period, withdrawals may be made from either or
both Divisions of all or part of the Participant's Account balance in a
Division or Sub-Account remaining after deductions for any applicable (1)
Annual Administration Charge (imposed on Total Withdrawals), (2) premium
taxes, and (3) outstanding loan including loan security. Annuity Conversion
Amounts are not considered withdrawals. See "Annuity Period, Annuities:
General."
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All withdrawal requests must indicate the amount to be withdrawn and be
submitted in a form acceptable to UNUM/America. If the request does not specify
the Sub-Accounts and/or the Divisions from which the withdrawal is to be made,
the withdrawal will be made pro rata based on balances in the Sub-Accounts and
the Guaranteed Investment Division. UNUM/America does not require that any
minimum amount be withdrawn. Telephone withdrawal requests are not available.
Withdrawals from the Variable Investment Division are made by reducing the
Participant's number of Accumulation Units in the applicable Sub-Account. In
determining the number of Accumulation Units to be reduced, UNUM/America uses
the Accumulation Unit Value next computed after UNUM/America's receipt of the
written withdrawal request.
Payment of all Variable Investment Division withdrawal amounts will be
made, within the time period allowed under current Federal law but in no case
later than seven days, after receipt by UNUM/America of the withdrawal request
in a form acceptable to UNUM/America. See "Market Emergencies."
During any one calendar year, a Participant may make one transfer or withdrawal
from the Guaranteed Interest Division to the Variable Investment Division in an
amount not to exceed 20% of the Guaranteed Interest Division Account balance.
TOTAL WITHDRAWALS
A Total Withdrawal can only be made by a Participant who has no
outstanding loans under the Contract. A Total Withdrawal of a Participant's
Account will occur when (a) the Participant or Contractholder requests the
liquidation of the Participant's entire Account balance, or (b) the amount
requested results in a remaining Participant's Account balance of less than
or equal to the Annual Administration Charge, in which case the request is
treated as if it were a request for liquidation of the Participant's entire
account balance.
Any Active Life Certificate must be surrendered to UNUM/America when a
Total Withdrawal occurs. If a Contractholder resumes Contributions on behalf of
a Participant after a Total Withdrawal, the Participant will receive a new
Participation Date and Active Life Certificate.
A Participant refund under the free-look provisions is not considered a
Total Withdrawal.
PARTIAL WITHDRAWALS
A Partial Withdrawal of a Participant's Account will occur when less than a
Total Withdrawal is made from a Participant's Account.
SYSTEMATIC WITHDRAWAL OPTION
Participants who are at least age 59 1/2, are separated from service from
their employer or are disabled and certain spousal beneficiaries and alternate
payees who are former spouses may be eligible for a Systematic Withdrawal Option
("SWO") under the Contract. Under the SWO a Participant may elect to withdraw
either a monthly amount which is an approximation of the interest earned between
each payment period based upon the interest rate in effect at the beginning of
each respective payment period or a flat dollar amount withdrawn on a periodic
basis. Payments are made only from the Guaranteed Interest Account. A
Participant must have a vested pre-tax account balance of at least $10,000 in
order to select the SWO. A Participant may transfer amounts from the Variable
Investment Division to the Guaranteed Interest Division in order to support SWO
payments. These transfers, however, are subject to the transfer restrictions
described in this Prospectus and/or imposed by any applicable Plan. A one-time
fee of up to $30 may be charged to set up the SWO. This charge is waived for
total vested pre-tax account balances of $25,000 or more. More information about
SWO, including applicable fees and charges, is available in the Contracts and
Active Life Certificates as well as from UNUM/America.
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MAXIMUM CONSERVATION OPTION
Under certain Contracts participants who are at least age 70 1/2 may
request that UNUM/America calculate and pay to them the minimum annual
distribution required by Sections 401(a)(9), 403(b)(10), 408(a) or 457(d) of the
Code. The Participant must complete forms as required by UNUM/America in order
to elect this option. UNUM/America will base its calculation solely on the
Participant's Account value with UNUM/America. Participants who select this
option are responsible for determining the minimum distributions amount
applicable to their non-UNUM/America contracts.
WITHDRAWAL RESTRICTIONS
Withdrawals under Section 403(b) Contracts are subject to the limitations
under Section 403(b)(11) of the Code and regulations thereof and in any
applicable Plan document. That section provides that salary reduction
Contributions deposited and earnings credited on any salary reduction
Contributions after December 31, 1988 may only be withdrawn if the Participant
has (1) died; (2) become disabled; (3) attained age 59 1/2; (4) separated from
service; or (5) incurred a hardship. Amounts accumulated in one Section
403(b)(1) contract may be transferred to another Section 403(b)(1) contract or
Section 403(b)(7) custodial account without a penalty under the Code. If amounts
accumulated in a Section 403(b)(7) custodial account are deposited in a
Contract, such amounts will be subject to the same withdrawal restrictions as
are applicable to post-1988 salary reduction Contributions under the Contracts.
For more information on these provisions see "Federal Income Tax
Considerations."
Withdrawal requests for a Participant under Section 457(b) Plans and Plans
subject to Title I of ERISA must be authorized by the Contractholder on behalf
of a Participant. All withdrawal requests will require the Contractholder's
written authorization and written documentation specifying the portion of the
Participant's Account balance which is available for distribution to the
Participant. Withdrawal requests for Section 457(f) Plans must be requested by
the Contractholder.
As required by Section 830.105 of the Texas Education Code, withdrawal
requests by Participants in the Texas Optional Retirement Program ("ORP") are
only permitted in the event of (1) death; (2) retirement; (3) termination of
employment in all Texas institutions of higher education; or (4) attainment of
age 70 1/2. A Participant in an ORP Contract is required to obtain a certificate
of termination from the Participant's Employer before a withdrawal request can
be granted.
For withdrawal requests (other than transfers to other investment
vehicles), by Participants under Plans not subject to Title I of ERISA and
non-457 Plans, the Participant must certify to UNUM/America that one of the
events listed in the Code has occurred (and provide supporting information, if
requested) and that UNUM/America may rely on such representation in granting
such withdrawal request. See "Federal Income Tax Considerations." A Participant
should consult their tax adviser as well as review the provisions of their Plan
before requesting a withdrawal.
In addition to the restrictions noted above, a Plan may contain additional
withdrawal or transfer restrictions.
Early withdrawals, as defined under Section 72(q) and 72(t) of the Code,
may be subject to a ten percent excise tax.
DEATH BENEFITS
The payment of death benefits will be governed by the provisions of the
applicable Plan and the Code. In the event of the death of a Participant during
the Accumulation Period, UNUM/America will pay the Beneficiary, if one is
living, or the Plan the greater of the following amounts:
(1) The Net Contributions, or
(2) The Participant's Account balance less any outstanding loan (including
principal and due and accrued interest), as of the date of notification.
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If UNUM/America is not notified of the Participant's death within six
months of such death, the Beneficiary will receive the Death Benefit amount
described in paragraph (2).
A Beneficiary may elect to have the Death Benefit (1) paid as a lump sum,
(2) converted to a Payout Annuity or (3) as a combination of a lump sum payment
and a Payout Annuity.
UNUM/America will calculate the Death Benefit as of the end of the
Valuation Period during which it receives both satisfactory notification of the
Participant's death and an election of a form of Death Benefit (as described
below). Payment of a lump sum election will be made within the time period
prescribed by Federal law but in no case later than seven days following such
calculation. Payment of an annuity option will be paid in accordance with the
provisions regarding annuities. See "Annuity Period." If no election is made
within sixty days following UNUM/America's receipt of satisfactory notice of the
Participant's death, the Death Benefit will be paid in the form of a lump sum
payment and will be calculated as of the end of the Valuation Period during
which that sixtieth day occurs (and payment will be made within the time period
prescribed by Federal law but in no case later than seven days after such
calculation date).
Satisfactory proof of death may consist of: a copy of a certified death
certificate; a copy of a certified decree of a court of competent jurisdiction
as to the finding of death; a written statement by a medical doctor who attended
the deceased at the time of death; or any other proof satisfactory to
UNUM/America.
Notwithstanding the above, if the Beneficiary is someone other than the
spouse of the deceased Participant, the Code provides that the Beneficiary may
not elect an annuity which would commence later than December 31st of the
calendar year following the calendar year of the Participant's death. If a
non-spousal Beneficiary elects to receive payment in a single lump sum, the Code
provides that such payment must be received no later than December 31st of the
fourth calendar year following the calendar year of the Participant's death.
If the Beneficiary is the surviving spouse of the deceased Participant,
distributions are not required under the Code to begin earlier than
December 31st of the calendar year in which the Participant would have attained
age 70 1/2. If the surviving spouse dies before the date distributions commence,
then, for purposes of determining the date distributions to the Beneficiary must
commence, the date of death of the surviving spouse is substituted for the date
of death of the Participant.
If there is no living named Beneficiary on file with UNUM/America at the
time of a Participant's death and unless the Plan directs otherwise,
UNUM/America will pay the Death Benefit to the Participant's estate in the form
of a lump sum payment, upon receipt of satisfactory proof of the Participant's
death, but only if such proof of death is received by UNUM/America no later than
the end of the fourth calendar year following the year of the Participant's
death. In such case, valuation of the Death Benefit will occur as of the end of
the Valuation Period during which due proof of death is received by
UNUM/America, and the lump sum Death Benefit will be paid within the time period
prescribed by Federal law but in no case later than seven days of that date.
DEDUCTIONS AND CHARGES
CHARGES AGAINST THE VARIABLE INVESTMENT DIVISION
Certain charges will be assessed as a percentage of the value of the net
assets of the Variable Investment Division to compensate UNUM/America for risks
assumed in connection with the Contracts.
MORTALITY AND EXPENSE RISK CHARGES
UNUM/America deducts from the net assets of the Variable Investment
Division a daily charge of 1.20% on an annual basis.
This charge is assessed both during the Accumulation Period and the Annuity
Period although, during the Annuity Period, UNUM/America will bear no mortality
risk with respect to the Annuity Options that do not involve life
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contingencies. This amount is intended to compensate UNUM/America for certain
Mortality and Expense Risks UNUM/America assumes in operating the Variable
Investment Division and for providing services to the Participant. The 1.2%
cumulative charge consists of .25% for the Expense Risk and .95% for the
Mortality Risk. The relative proportion of these charges, consistent with
industry practice, is estimated and, therefore, may change based on
UNUM/America's experience in administering the Contracts. However, the total
cumulative charge may not be altered.
The Expense Risk is the risk that UNUM/America's actual expenses in issuing
and administering the Contract will be more than UNUM/America estimated. The
Mortality Risk borne by UNUM/America arises from the chance that UNUM/America's
actuarial estimate of mortality rates during the Annuity Period, as guaranteed
in the Contract, may prove erroneous and that an Annuitant may live longer than
expected. This contractual guarantee assures that neither an Annuitant's own
longevity nor an improvement in life expectancy generally will have any adverse
effect under the Contracts. In addition, UNUM/America bears the Mortality Risk
that it guarantees to pay a Death Benefit that may be higher than the
Participant's Account balance upon the death of the Participant prior to the
Annuity Period.
UNUM/America may ultimately realize a profit from these charges to the
extent they are not needed to meet the actual expenses incurred.
CHARGES AGAINST THE CONTRACTS
The charges that UNUM/America assesses in connection with the Contracts are
described below.
ANNUAL ADMINISTRATION CHARGE
UNUM/America provides many administrative functions in connection with the
Contracts, including receiving and allocating Contributions in accordance with
the Contracts, making annuity payments when they become due, and preparing and
filing all reports required to be filed by the Variable Investment Division. In
addition, UNUM/America provides Participants with Account statements and
accounting services that keep track of pre-tax monies, employee and Employer
monies, vested Account balances and rollover or transferred monies.
In consideration for these administrative services, UNUM/America
currently deducts $25 (or the balance of the Participant's Account if less)
per year from each Participant's Account balance on the last Business Day of
the month in which a Participation Anniversary occurs. This charge is
deducted only during the Accumulation Period. This Annual Administration
Charge is also withdrawn from a Participant's Account balance if and when a
Participant's Account is totally withdrawn on any date other than the last
Business Day of the month in which the Participation Anniversary occurs. The
Annual Administrative Charge is a reasonable estimate of the costs, without
profit, of administering the Contracts. The charge may be increased or
decreased (subject to any appropriate regulatory approvals).
The Annual Administration Charge may be reduced or waived for those
Participants who are participating under another UNUM/America contract which
imposes an Annual Administration Charge or where UNUM/America's interest costs
or expenses are reduced due to the terms of the Contract, economies of scale or
administrative assistance provided by the Contractholder. In addition, the
Employer has the option of paying the Annual Administration charge on behalf of
the Participants under a Contract.
Under certain Contracts, the Contractholder may also choose to have the
Annual Administration Charge paid only by those Participants in the Variable
Investment Division. Contracts offering this provision will typically have a
declared interest rate in the Guaranteed Interest Division which is lower than
under contracts not offering this provision. For contracts offering this
provision, the Annual Administration Charge will be withdrawn as described in
this section.
Beginning on the Closing Date, Lincoln Life will administer the Contracts
on behalf of UNUM/America pursuant to an administrative services agreement. See
"Acquisition Agreement with The Lincoln National Life Insurance Company."
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PREMIUM TAXES
Certain states require that a premium tax be paid on contributions to a
variable annuity contract. Others assess a premium tax at the time of
annuitization. UNUM/America will deduct any applicable premium tax from the
Participant's Account balance at the time required by state law.
MISCELLANEOUS
The Variable Investment Division purchases shares from the Funds at net
asset value. The net asset value reflects investment management fees and other
expenses that have already been deducted from the assets of the Funds. The
Funds' investment management fees, expenses and expense limitations, if
applicable, are more fully described in each prospectus for the Funds.
ANNUITY PERIOD
PAYOUT ANNUITIES: GENERAL
To the extent permitted by the Plan, the Participant, or the Beneficiary of
a deceased Participant, may elect to convert all or part of the Participant's
Account balance or the Death Benefit to a Payout Annuity. Payout Annuities are
available as either a Guaranteed or Variable Annuity or a combination of both.
Annuity payments from the Guaranteed Interest Division remain constant
throughout the annuity period. Annuity payments from the Variable Investment
Division fluctuate depending upon the investment experience of the applicable
Sub-Accounts. Variable Annuity payments are based upon Annuity Unit Values. See
"Annuity Payments" below and "Determination of Variable Annuity Payments" in the
Statement of Additional Information for further information.
The Annuity Commencement Date marks the date on which UNUM/America makes
the first annuity payment to an Annuitant. For Plans subject to Section
401(a)(9)(B) of the Code, a Beneficiary must select an Annuity Commencement Date
that is not later than one year after the date of the Participant's death. A
Participant or Contractholder may select any Annuity Commencement Date for the
Annuitant which is then reflected in the Retired Life Certificate. However,
since an annuity payment is considered a distribution under the Code, selection
of an Annuity Commencement Date may be affected by the distribution restrictions
under the Code and the minimum distribution requirements under Section
401(a)(9) of the Code. See "Federal Income Tax Considerations." The selection of
an Annuity Commencement Date, the annuity option, the amount of the Payout
Annuity and whether the amount is to be paid as a Guaranteed or a Variable
Annuity must be made by the Participant in writing, in a form satisfactory to
UNUM/America, and received by UNUM/America at least 30 days in advance of the
Annuity Commencement Date. After the Annuity Commencement Date an Annuitant may
not change either their annuity option or the type (i.e., variable or
guaranteed) of Payout Annuity for any amount applied toward the purchase of an
annuity.
The Annuity Conversion Amount is either the Participant's Account balance,
or a portion thereof, or the Death Benefit plus interest, as of the Annuity
Payment Calculation Date. The initial Annuity Payment Calculation Date will be
the first day of the calendar month next following the Annuity Commencement Date
for a Guaranteed Annuity and 10 Business Days prior to the first day of the
calendar month next following the Annuity Commencement Date for a Variable
Annuity. For Guaranteed Annuities, the Annuity Payment Calculation Date is the
first day of a calendar month. For Variable Annuities, the Annuity Payment
Calculation Date is the date 10 Business Days prior to the first day of a
calendar month; the 10 Business Days being necessary to calculate the amount of
the Payout Annuity payments and to mail the checks in advance of their
first-of-month due dates.
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If the Participant's Account balance or the Beneficiary's Death Benefit is
less than $2,000.00 or if the amount of the first scheduled payment is less than
$20.00, UNUM/America may, at its option, cancel the annuity and pay the
Participant or Beneficiary the entire amount in a lump sum.
PAYOUT ANNUITY PAYMENTS
The amount of each annuity payment will depend upon the Annuity Conversion
Amount applied to an annuity option, the form of the annuity option selected and
the age of the Participant at the Annuity Commencement Date. Unless otherwise
notified, UNUM/America will apply the Participant's Account balance in the
Guaranteed Interest Division toward a Guaranteed Annuity and the Participant's
Account balance in the Variable Investment Division toward a Variable Annuity.
The payment amount for a Guaranteed Annuity is determined by dividing the
Participant's Annuity Conversion Amount in the Guaranteed Interest Division as
of the initial Annuity Payment Calculation Date by the applicable Annuity
Conversion Factor as defined in the Contract.
The initial payment amount for a Variable Annuity is determined by dividing
the Participant's Annuity Conversion Amount(s) in the applicable Sub-Account(s)
as of the initial Annuity Payment Calculation Date by the applicable Annuity
Conversion Factor as defined in the Contract. The amounts of subsequent payments
vary depending on the investment experience of the Sub-Account(s) and the
interest rate option selected by the Contractholder or Annuitant. The payment
amounts will not be affected by UNUM/America's mortality or expense experience
and will not be reduced by an Annual Administration Charge. For additional
information on the determination of subsequent payment amounts, refer to the
Statement of Additional Information, "Determination of Variable Annuity
Payments."
PAYOUT ANNUITY OPTIONS
UNUM/America offers a range of annuity options including, but not limited
to, the following:
LIFE ANNUITY
Payments are made monthly during the lifetime of the Annuitant, and the
annuity terminates with the last payment preceding death.
LIFE ANNUITY WITH PAYMENTS GUARANTEED FOR 10, 15 OR 20 YEARS
Payments are made monthly during the lifetime of the Annuitant with a
monthly payment guaranteed to the Beneficiary for the remainder of the selected
number of years, if the Annuitant dies before the end of the period selected.
Payments under this annuity option are smaller than a Life Annuity without a
guaranteed payment period.
JOINT AND SURVIVOR ANNUITIES
Payments are made monthly during the joint lifetime of the Annuitant and a
designated second person.
PAYMENTS GUARANTEED FOR 10, 15 OR 20 YEARS
Annuity payments are guaranteed monthly for the selected number of years.
While there is no right to make any total or partial withdrawals during the
Annuity Period, an Annuitant who has selected this annuity option as a Variable
Annuity or a surviving Beneficiary may request at any time during the payment
period that the present value of any remaining installments be paid in one lump
sum.
Under Qualified Plans, any annuity selected must be payable over a period
that does not extend beyond the life expectancy of the Participant and the
Participant's designated Beneficiary. If the Beneficiary is someone other than
the
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Participant's spouse, the present value of payments to be made to the
Participant must be more than 50% of the present value of the total payments to
be made to the Participant and the Beneficiary.
In the event that an Annuitant dies before the end of a designated Annuity
period, the Beneficiary, if any, or the Annuitant's estate will receive any
remaining payments due under the annuity option in effect.
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FEDERAL INCOME TAX CONSIDERATIONS
The following discussion assumes that the contracts will qualify as annuity
contracts for Federal income tax purposes. The description of the Federal
income tax status of amounts received under the Contracts is not exhaustive and
is not intended to cover all situations. Contractholders and Participants should
seek advice from their tax advisers on a regular basis as to the application of
Federal (and, where applicable, state and local) tax laws to amounts received by
them or their Beneficiaries under the Contracts. All dollar amounts and
percentages stated below are subject to change according to Federal law. With
respect to the transfer of Contracts from UNUM/America to Lincoln Life or
Lincoln-NY, there will be no adverse tax consequences to Contractholders or
participants as a result of the transfer. For additional Federal Income Tax
Considerations, please refer to the Statement of Additional Information.
NON-QUALIFIED PLANS
Under a non-qualified Plan, an individual may make Contributions to the
Contract which are neither tax-deductible or tax deferred. The earnings on the
Contributions accumulate on a tax-deferred basis until withdrawn. Non-qualified
Plans investing in annuity contracts are subject to the Federal taxation
rules of Section 72 of the Code.
The Code does not limit the Participant's contributions to a Section 72
plan. There are no Code restrictions on withdrawals or minimum age when the
Participant must begin withdrawals.
SECTION 401(a) PLANS
Section 401(a) of the Code provides special tax treatment for pension,
profit sharing and stock bonus Plans established by employers for their
employees. Contributions to a Section 401(a) Plan and any earnings attributable
to such Contributions are currently excluded from the Participant's income.
Section 401(a) Plans are subject to, among other things, limitations on: maximum
contributions, minimum coverage and participation, minimum funding, minimum
vesting requirements and distribution requirements. The specific limitations are
outlined in the plan document adopted by the employer.
A Participant who makes a withdrawal from a Section 401(a) program must
include that amount in current income. In addition, Section 401(k)(2) of the
Code requires that salary reduction Contributions made and/or earnings credited
on any salary reduction Contributions may not be withdrawn from the
Participant's Section 401(k) program prior to the Participant having
(1) attained age 59 1/2, (2) separated from service, (3) become disabled,
(4) died or (5) incurred a hardship. Hardship withdrawals may not include any
income credited after December 31, 1988 that is attributable to any salary
reduction Contributions. In addition, Section 402 of the Code permits tax-free
rollovers from Section 401(a) programs to individual retirement annuities or
certain other Section 401(a) programs under certain circumstances.
SECTION 403(b) PLANS
A Participant who is an employee of a hospital or other tax-exempt
organization described in Section 501(c)(3) or 501(e) of the Code may exclude
from current earnings amounts contributed to a Section 403(b) program. Under the
terms of a Section 403(b) program, an Employer may make Contributions directly
to the program on behalf of the Participant, the Participant may enter into a
salary reduction agreement with the Participant's Employer authorizing the
Employer to contribute a percentage of the Participant's salary to the program
and/or the Participant may authorize the Employer to make after tax
Contributions to the program. Currently, the Code permits employees to defer up
to $9,500 of their income through salary agreements. All Contributions made to
the Section 403(b) program are subject to the limitations described in Code
Sections 402(g) regarding elective deferral amounts, 403(b)(2) regarding the
maximum exclusion allowance, and 415(a)(2) and 415(c) regarding the limitations
on annual additions.
A Participant who makes a withdrawal from their Section 403(b) program must
include that amount in current income. In addition, Section 403(b)(11) of the
Code requires that salary reduction Contributions made and/or earnings
29
<PAGE>
credited on any salary reduction Contributions after December 31, 1988 may not
be withdrawn from the Participant's Section 403(b) program prior to the
Participant having (1) attained age 59 1/2, (2) separated from service,
(3) become disabled, (4) died or (5) incurred a hardship. Hardship withdrawals
may not include any income credited after December 31, 1988 that is attributable
to any salary reduction Contributions. The Internal Revenue Service has ruled
(Revenue Ruling 90-24) that amounts may be transferred between Section
403(b) investment vehicles as long as the transferred funds retain withdrawal
restrictions at least as restrictive as that of the transferring investment
vehicle. In addition, Section 403(b)(8) of the Code permits tax-free rollovers
from Section 403(b) programs to individual retirement annuities or other
Section 403(b) programs under certain circumstances. Qualified distributions
eligible for rollover treatment may be subject to a 20% federal tax withholding
depending on whether or not the distribution is paid directly to an eligible
retirement plan.
SECTION 408 PLANS (IRAs)
Under current law, individuals may contribute and deduct the lesser of
$2,000 or 100% of their compensation to an IRA. In the case of a spousal IRA,
the maximum deduction is the lesser of $2,250 or 100% of compensation. The
deduction for Contributions is phased out for individuals who are considered
active participants under qualified Plans and whose Adjusted Gross Income
attains a certain level. For a single person the $2,000 deduction is available
when the taxpayers Adjusted Gross Income is $25,000 or less. For each $50 that
the taxpayer's Adjusted Gross Income rises above $25,000, the taxpayer's
deductible IRA is reduced by $10. When the single taxpayer's Adjusted Gross
Income is $35,000 or greater, a tax deduction for an IRA is no longer available.
For a married couple filing jointly, the threshold level is $40,000 rather than
$25,000. For a married person filing separately, the threshold is $0.
In addition, certain amounts distributed from Section 401(a) and 403(b)
Plans may be rolled over to an IRA on a tax-free basis if done in a timely
manner (within 60 days of the Participant's receipt of the distribution). The
limitations on contributions discussed above do not apply to amounts rolled over
to an IRA.
All Participants in an IRA receive an IRA Disclosure. This document
explains the tax rules that apply to IRAs in greater detail.
ELIGIBLE SECTION 457 PLANS
Eligible Section 457 Plans may be established by state and local
governments as well as private tax-exempt organizations (other than churches).
Participants may contribute on a before tax basis to a deferred compensation
Plan of their employer in accordance with the employer's Plan and Section 457 of
the Code. Section 457 places limitations on the amount of Contributions to these
Plans. Generally, the limitation is one-third of includable compensation or
$7,500 whichever is less. In the Participant's final year of employment the
$7,500 limit is increased to $15,000.
Participants in an Eligible 457 Plan may not receive a withdrawal or other
distribution from their Plan except in the event of separation of service from
the employer, attainment of age 70 1/2, or when faced with an unforeseen
emergency. The Contractholder's Plan may further restrict the Participant's
rights to a withdrawal.
An employee electing to participate in an Eligible Section 457 Plan should
understand that their rights and benefits are governed strictly by the terms of
the Plan, that they are in fact a general creditor of the Employer under the
terms of the Plan, that the Employer is legal owner of any contract issued with
respect to the Plan and that the Employer retains all rights under the contract
issued with respect to the Plan. Participants under Eligible Section 457 Plans
should look to the terms of their Plan for any charges in regard to
participation other than those disclosed in this Prospectus.
30
<PAGE>
SECTION 457(f) PLANS
Section 457(f) Plans may be established by state and local governments as
well as private tax-exempt organizations. Employers and Participants may
contribute on a before-tax basis to a deferred compensation Plan of their
employer in accordance with the employer's Plan. Section 457(f) does not place
limitations on the amount of Contributions to these Plans; however, the Internal
Revenue Service may review these plans to determine if the deferral amount is
acceptable to the IRS based on the nature of the 457(f) Plan.
Participants in 457(f) Plans may not receive a withdrawal or other
distribution from their 457(f) Plans until a distributable event occurs. The
Plan will define such events.
An employee electing to participate in a Section 457(f) Plan should
understand that their rights and benefits are governed strictly by the terms of
the Plan, that they are in fact a general creditor of the Employer under the
terms of the Plan, that the Employer is legal owner of any contract issued with
respect to the Plan and that the Employer retains all rights under the contract
issued with respect to the Plan. Participants under Section 457(f) Plans should
look to the terms of their Plan for any charges in regard to participating other
than those disclosed in this Prospectus.
TAXATION OF ANNUITIES: GENERAL
In Qualified Plans such as 401(a), 403(b), 408 and Eligible 457, the
Participant is not taxed on the value in their accounts until they receive
payments from the account. In some situations, default or forgiveness of a loan
will result in taxable income. Distributions from all these Plans are taxed
under the rules of Sections 72 and 402 of the Code.
TAXATION PRIOR TO THE ANNUITY COMMENCEMENT DATE
Section 72 of the Code provides that a total or partial withdrawal prior to
the Annuity Commencement Date will be taxable to the extent the amount of the
income in the Participant's account exceeds the Participant's investment in the
Participant's account. In general, distributions from a Participant's Account
under Sections 401(a), 403(b) and 408 Plans under which the Participant made
after-tax contributions will be taxable according to a formula based on the
ratio of the Participant's investment in the contract to the total value of the
Participant's Account balance as of the date of the distribution. Under an
Eligible 457 Plan the Participant is taxed on the value when it is made
available to the Participant. In a 457(f) Plan the Participant is taxed when
their right to a distribution is no longer subject to a substantial risk of
forfeiture.
PENALTY TAX FOR PREMATURE DISTRIBUTIONS
Sections 72(q) and 72(t) impose a 10% excise tax on certain premature
distributions for non-qualified and Section 401(a), 403(b) and 408 Plans. The
penalty tax will not apply to distributions made on account of the Participant
having (i) attained age 59 1/2; (ii) become disabled; or (iii) died. The penalty
tax will also not apply under 401(a) and 403(b) retirement plans where a
Participant separates from service after age 55. In addition, the penalty does
not apply if the distribution is received as a series of substantially equal
periodic payments made for the life (or life expectancy) of the Participant or
the joint lives (or life expectancies) of the Participant and a designated
Beneficiary. The 10% excise tax is an additional tax; it does not apply to any
money that the Participant receives as a return of their cost basis. The 10%
excise tax does not apply to Section 457 Plans.
MINIMUM DISTRIBUTIONS
Participants in Plans subject to Code Sections 401(a), 403(b), 408 and
Eligible 457 Plans are subject to Minimum Distribution Rules. For a Participant
who attains age 70 1/2 after December 31, 1987, distributions must begin by
April 1 of the calendar year following the calendar year in which the
Participant attains age 70 1/2. For a Participant who attains age 70 1/2 before
January 1, 1988, distributions must begin on the April 1 of the calendar year
following the later of (1) the calendar year in which the Participant attains
age 70 1/2 or (2) the calendar year in which the Participant retires.
31
<PAGE>
VOTING RIGHTS
UNUM/America is the legal owner of the shares of the Funds held by the
Variable Investment Division. As such, UNUM/America is entitled to vote those
Fund shares with respect to issues such as the election of a Fund's directors,
ratification of a Fund's choice of independent auditors and other matters
required by the 1940 Act to be voted on by shareholders.
In those years in which the Funds hold a shareholder meeting, UNUM/America
will solicit from Contractholders voting instructions with respect to Fund
shares held by the Variable Investment Division. Each Contractholder will
receive a number of votes in proportion to the Contractholder's investment in
the corresponding Sub-Account as of the record date established by the Fund.
During the Accumulation Period, a Participant has the right to instruct
Contractholders as to the votes attributable to their Participant Account
balance in the Sub-Accounts. Annuitants have similar rights with respect to the
annuity amount attributable to the Sub-Accounts.
UNUM/America will furnish Contractholders with sufficient Fund proxy
material and voting instruction forms for all Participants who have voting
rights under the Contract. UNUM/America will vote those Fund shares attributable
to the Contract for which UNUM/America receives no voting instructions in the
same proportion as UNUM/America will vote shares for which UNUM/America has
received instructions. UNUM/America will vote shares attributable to amounts
UNUM/America may have in the Variable Investment Division in the same proportion
as votes that UNUM/America receives from Contractholders. If the federal
securities laws or regulations or any interpretation of them changes so that
UNUM/America is permitted to vote shares of the Fund in UNUM/America's own right
or to restrict Participant voting, UNUM/America may do so.
Fund shares may be held by separate accounts of insurance companies
unaffiliated with UNUM/America. Fund shares held by those separate accounts will
be voted, in most cases, according to the instruction of owners of insurance
policies and contracts issued by those other unaffiliated insurance companies.
This will dilute the effect of the voting instructions of the Contractholders in
the Variable Investment Division. UNUM/America does not foresee any disadvantage
to this. Pursuant to conditions imposed in connection with regulatory relief,
the Fund's Board of Directors has an obligation to monitor events to identify
conflicts that may arise and to determine what action, if any, should be taken.
For further information, see the prospectuses for the Funds.
OTHER CONTRACT PROVISIONS
RIGHTS RESERVED BY UNUM/AMERICA
UNUM/America reserves the right, subject to compliance with applicable law,
including approval by the Contractholder or the Participants if required by law,
(1) to create additional Sub-Accounts in the Variable Investment Division,
(2) to combine or eliminate Sub-Accounts in the Variable Investment Division,
(3) to transfer assets from one Sub-Account in the Variable Investment Division
to another, (4) to transfer assets to the General Account and other separate
accounts, (5) to cause the deregistration and subsequent re-registration of the
Variable Investment Division under the Investment Company Act of 1940, (6) to
operate the Variable Investment Division under a committee and to discharge such
committee at any time, and (7) to eliminate any voting rights which the
Contractholder or the Participants may have with respect to the Variable
Investment Division, (8) to amend the Contract to meet the requirements of the
Investment Company Act of 1940 or other federal securities laws and regulations,
(9) to operate the Variable Investment Division in any form permitted by law,
(10) to substitute shares of another fund for the shares held by a Sub-Account,
and (11) to make any change required by the Internal Revenue Code, ERISA or the
Securities Act of 1933. Participants will be notified if any changes are made
that result in a material change in the underlying investments of the Variable
Investment Division.
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<PAGE>
ASSIGNABILITY
The Contracts are not assignable without UNUM/America's prior written
consent. In addition, a Participant, a Beneficiary or an Annuitant may not,
unless permitted by law, assign or encumber any payment due under the Contract.
MARKET EMERGENCIES
While UNUM/America may not suspend the right of redemption or delay payment
from the Variable Investment Division for more than the time period allowed
under Federal law but in no case longer than seven days, the following events
may delay payment for more than seven days: (1) any period when the New York
Stock Exchange is closed (other than customary weekend and holiday closings);
(2) any period when trading in the markets normally utilized is restricted, or
an emergency exists as determined by the Securities and Exchange Commission, so
that disposal of investments or determination of the Accumulation Unit Value or
Variable Annuity payment value is not reasonably practicable; or (3) for such
other periods as the Securities and Exchange Commission by order may permit for
the protection of the Participants.
CONTRACT DEACTIVATION
Under certain Contracts UNUM/America may deactivate a Contract by
prohibiting new contributions and/or new Participants after the date of
deactivation. UNUM/America will give the Contractholder and the Participants
not less than 90 days notice of the date of deactivation.
FREE-LOOK PERIOD
Participants under Sections 403(b), 408 and certain Non-qualified Plans
will receive an Active Life Certificate upon UNUM/America's receipt of a duly
completed participation enrollment form. If the Participant chooses not to
participate under the Contract, the Participant may exercise the free-look right
by sending a written notice to UNUM/America that the Participant does not wish
to participate under the Contract, within 10 days after the date the Active Life
Certificate is received by the Participant. For purposes of determining the date
on which the Participant has sent written notice, the postmark date will be
used.
If a Participant exercises the free-look right in accordance with the
foregoing procedure, UNUM/America will refund in full the Participant's
aggregate Contributions less aggregate withdrawals made on behalf of the
Participant or, if greater, with respect to Contributions to the Variable
Investment Division, the Participant's Account balance in the Variable
Investment Division on the date the Participant's written notice is received by
UNUM/America.
GUARANTEED INTEREST DIVISION
GENERAL
Contributions to the Guaranteed Interest Division become part of
UNUM/America's General Account. The General Account is subject to regulation and
supervision by the Maine Insurance Department as well as the insurance laws and
regulations of the jurisdictions in which the Contracts are distributed. In
reliance on certain exemptions, exclusions and rules, UNUM/America has not
registered the interests in the General Account as a security under the
Securities Act of 1933 and has not registered the General Account as an
investment company under the 1940 Act.
Accordingly, neither the General Account nor any interests therein are
subject to regulation under the 1933 Act or the 1940 Act. UNUM/America has been
advised that the staff of the SEC has not made a review of the disclosures which
are included in this prospectus which relate to the General Account and the
Guaranteed Interest Division. These disclosures, however, may be subject to
certain generally applicable provisions of the federal securities laws relating
to the accuracy and completeness of statements made in prospectuses. This
prospectus is generally intended to serve as a disclosure document only for
aspects of the Contract involving the Variable Investment Division and contains
only selected information regarding the Guaranteed Interest Division. Complete
details regarding the Guaranteed Interest Division are in the Contract.
33
<PAGE>
Amounts contributed to the Guaranteed Interest Division are guaranteed a
minimum interest rate of at least 3.0%. UNUM/America will also declare in
advance a guaranteed interest rate which will be effective for all amounts in
the Participant's Account balance in the Guaranteed Interest Division during the
designated year. This rate will never be less than the minimum rate of interest.
UNUM/America may also declare in advance separate interest rate guarantees which
are in excess of the guaranteed interest rate for some or all of the
Participant's Account balance in the Guaranteed Interest Division for specific
period(s) during the designated year. A Participant who makes a Contribution to
the Guaranteed Interest Division is credited with interest from the day of
deposit in the Guaranteed Interest Division.
PARTICIPANT'S ACCOUNT BALANCE IN THE GUARANTEED INTEREST DIVISION
The Participant's Account balance in the Guaranteed Interest Division on
any Valuation Date will reflect the amount and frequency of any Contributions
allocated to the Guaranteed Interest Division, plus any transfers from the
Variable Investment Division and interest credited to the Guaranteed Interest
Division, less any withdrawals, Annual Administration Charges and
loan-related charges allocated to the Guaranteed Interest Division and any
transfers to the Variable Investment Division.
TRANSFERS, TOTAL AND PARTIAL WITHDRAWALS
During any one calendar year a Participant may make one withdrawal or transfer
from the Guaranteed Interest Division in an amount not to exceed 20% of the
Guaranteed Interest Division Account balance. Any Participant stating their
intention to liquidate their Guaranteed Interest Division Account balance,
however, may make one withdrawal request for five consecutive calendar years
from their Guaranteed Interest Division Account balance in the following
percentage:
YEAR REQUEST PERCENTAGE OF GUARANTEED
RECEIVED BY UNUM INTEREST DIVISION AVAILABLE
---------------- ---------------------------
1 20%
2 25%
3 33.33%
4 50%
5 100%
The five consecutive withdrawals may mot be submitted more frequently
than twelve months apart. UNUM/America also reserves the right to require
that any Participant stating their intention to liquidate their Guaranteed
Interest Division Account balance stop Contributions to the Contract.
In addition, a Participant may withdraw 100% of their Guaranteed
Interest Division Account balance at any time provided that UNUM/America
receives satisfactory proof of the following events: (a) the Participant has
attained age 59 1/2; (b) the Participant has died; (c) the Participant has
incurred a disability as defined under the Contract; (d) the Participant has
separated from service from their Employer; and (e) the Participant has
incurred a financial hardship. A Contractholder has the option of choosing to
eliminate financial hardship as an event entitling the Participant to a 100%
withdrawal from the Contract and also to add a requirement that the
Participant be 55 years of age upon separation from service to be entitled to
a 100% withdrawal from the Guaranteed Interest Division. Contractholders
choosing one or both of these optional provisions will receive a higher
declared interest rate on the Guaranteed Interest Division than will
Contracts without these provisions.
LOANS
During a Participant's Accumulation Period, a Participant, whose Plan
permits loans, may apply for a loan under the Contract by completing a loan
application available from UNUM/America. Loans are secured by the
Participant's Account balance in the Guaranteed Interest Division. The
amounts and terms of a Participant loan may be subject to the restrictions
imposed under Section 72(p) of the Code, Title I of ERISA, and any applicable
Plans. With respect to Plans subject to Title I of ERISA, the initial amount
of a Participant loan may not exceed the lesser of 50% of the Participant's
vested Account balance in the Guaranteed Interest Division or $50,000 and
must be at least $1,000.00. A Participant in a
34
<PAGE>
Plan that is not subject to ERISA may borrow up to $10,000 of their vested
Account balance without regard to the 50% limitation stated above. A
Participant may have only one loan outstanding at any time and may not
establish more than one loan in any six month period. Amounts serving as
collateral for the loan are not subject to the minimum interest rate under
the Contract and will accrue interest at a rate which is below the loan
interest rate as provided in the contract. Under certain Contracts, a
one-time fee of up to $50 may be charged to set up a loan. More information
about loans, including interest rates and applicable fees and charges, is
available in the Contracts, Active Life Certificates, and Annuity Loan
Agreement as well as from UNUM/America.
DEFERRAL PERIODS
If a payment is to be made from the Guaranteed Interest Division,
UNUM/America may defer the payment for the period permitted by the law of the
jurisdiction in which the Contract is distributed, but in no event, for more
than 6 months after a written election is received by UNUM/America. During
the period of deferral, interest at the then current interest rate will
continue to be credited to a Participant's Account in the Guaranteed Interest
Division.
35
<PAGE>
TABLE OF CONTENTS FOR
STATEMENT OF ADDITIONAL INFORMATION
PAGE
----
DEFINITIONS 2
DETERMINATION OF ACCUMULATION UNIT VALUES 2
DETERMINATION OF VARIABLE ANNUITY PAYMENTS 3
PERFORMANCE CALCULATIONS 4
TAX LAW CONSIDERATIONS 8
DISTRIBUTION OF CONTRACTS 11
CUSTODIAN 11
INDEPENDENT AUDITORS/ACCOUNTANTS 11
FINANCIAL STATEMENTS 11
Financial Statements of Variable Investment Division
Financial Statements of UNUM/America
36
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION
MAY 1, 1996
GROUP ANNUITY CONTRACTS
FUNDED THROUGH THE INVESTMENT DIVISIONS OF
VA-I SEPARATE ACCOUNT
OF
UNUM LIFE INSURANCE COMPANY OF AMERICA
VARIABLE ANNUITY III
TABLE OF CONTENTS
PAGE
----
Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Determination of Accumulation Unit Values. . . . . . . . . . . . . . . . 2
Determination of Variable Annuity Payments . . . . . . . . . . . . . . . 3
Performance Calculations . . . . . . . . . . . . . . . . . . . . . . . . 4
Tax Law Considerations . . . . . . . . . . . . . . . . . . . . . . . . . 8
Distribution of Contracts. . . . . . . . . . . . . . . . . . . . . . . . 11
Custodian. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Independent Auditors . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Financial Statements of Variable Investment Division
Financial Statements of UNUM/America
This Statement of Additional Information (SAI) is not a prospectus. It should be
read in conjunction with the prospectus for the Group Annuity Contracts (the
"Contracts"), dated May 1, 1996.
A copy of the prospectus to which this SAI relates is available at no charge by
writing to UNUM/America at the UNUM Life Insurance Company of America, 2211
Congress Street, Portland, Maine 04122-0981 Attention: Retirement Security
Division Compliance; or by calling UNUM/America at (207) 770-2211.
<PAGE>
DEFINITIONS
ANNUITANT: The person receiving annuity payments under the terms of this
Contract.
ANNUITY COMMENCEMENT DATE: The date on which UNUM/America makes the first
annuity payment to the Annuitant as required by the Retired Life Certificate.
This date, as well as the date each subsequent annuity payment is made, will be
the first day of a calendar month.
ANNUITY CONVERSION AMOUNT: The amount applied toward the purchase of an Annuity.
ANNUITY CONVERSION FACTOR: The factor applied to the Annuity Conversion Amount
in determining the dollar amount of an annuitant's annuity payments for
Guaranteed Annuities or the initial payment for Variable Annuities.
ANNUITY PAYMENT CALCULATION DATE: For Guaranteed Annuities, this is the first
day of a calendar month. For Variable Annuities, this is the Valuation Date ten
(10) business days prior to the first day of a calendar month.
ANNUITY PERIOD: The period concurrent with or following the Accumulation Period,
during which an Annuitant's annuity payments are made.
ANNUITY UNIT: An accounting unit of measure that is used in calculating the
amounts of annuity payments to be made from a Sub-Account during the Annuity
Period.
ANNUITY UNIT VALUE: The dollar value of an Annuity Unit in a Sub-Account on any
Valuation Date.
CODE: The Internal Revenue Code of 1986, as amended.
PAYOUT ANNUITY: A series of payments paid out under the terms of the Contract
as either a Guaranteed Annuity or as a Variable Annuity.
PLAN: The retirement program offered by an Employer to its employees to
accumulate funds for retirement.
VARIABLE ANNUITY: An annuity with payments that increase or decrease in
accordance with the investment results of the selected Sub-Accounts.
DETERMINATION OF ACCUMULATION UNIT VALUES
As described more fully in the prospectus, Contributions are allocated to the
Divisions in accordance with directions from the Employer. A Participant who
makes Contributions which are allocated to the Variable Investment Division is
credited with Accumulation Units. The following examples illustrate the method
by which UNUM/America determines the Net Investment Factor (NIF) for the current
Valuation Period and the Accumulation Unit Value as of the end of the current
Valuation Period.
Determination of NIF:
(a) Assumed Fund net asset value as of the close of the New York Stock Exchange
on June 1 = 10.45
(b) Assumed Fund net asset value as of the close of the New York Stock Exchange
on June 2 = 10.56 (no capital gains or dividend distributions or deductions for
taxes)
(c) The NIF for the current Valuation Period = (b) divided by (a) times (1-
annual M & E) to the 1/365th power
(d) 1.010526 x .999966 = 1.0104916
2
<PAGE>
Determination of Accumulation Unit Value:
The Accumulation Unit Value as of the end of the current Valuation Period is
determined by multiplying the NIF for the current Valuation Period by the
Accumulation Unit Value as of the end of the immediately preceding Valuation
Period.
(a) Assumed Accumulation Unit Value as of the end of the immediately preceding
Valuation Period = 11.125674.
(b) Accumulation Unit Value as of the end of the current Valuation Period =
11.125674 x 1.0104916 (NIF) = 11.2424.
The number of Accumulation Units which are credited to the Participant's Account
for each Sub-Account on each Valuation Date equals the amount of Contributions
allocated to the Sub-Account on each Valuation Date divided by the Accumulation
Unit Value rounded to four decimal places. For example,
(a) Participant's assumed Contribution allocated to a Sub-Account on June 2 =
$150.
(b) Number of Accumulation Units credited to Participant = $150 divided by
11.2424 = 13.3423.
DETERMINATION OF VARIABLE ANNUITY PAYMENTS
As stated in the prospectus, the amount of each Variable Annuity payment will
vary depending on the investment experience of the selected Sub-Accounts.
The initial payment amount of the Annuitant's Variable Annuity for each Sub-
Account is determined by dividing his Annuity Conversion Amount in each Sub-
Account as of the initial Annuity Payment Calculation Date by the Applicable
Annuity Conversion Factor as defined as follows:
The Annuity Conversion Factors which are used to determine the initial payments
are based on the [ 1983 Individual Annuity Mortality Table, set back four (4)
years, and an interest rate in an integral percentage ranging from zero to six
percent (0 to 6.00%) as selected by the Annuitant.
The amount of the Annuitant's subsequent Variable Annuity payment for each Sub-
Account is determined by:
(a) Dividing the Annuitant's initial Variable Annuity payment amount by the
Annuity Unit Value for that Sub-Account selected for his interest rate
option as described above as of his initial annuity Payment Calculation
Date; and
(b) Multiplying the resultant number of annuity units by the Annuity Unit
Values for the Sub-Account selected for his interest rate option for his
respective subsequent Annuity Payment Calculation Dates.
The Annuity Unit Value for all Sub-Accounts for all interest rate options will
initially be set at ten dollars ($10). Each subsequent Annuity Unit Value for a
Sub-Account for an interest rate option is determined by:
Dividing the Accumulation Unit Value for the Sub-Account as of subsequent
Annuity Payment Calculation Date (APCD) by the Accumulation Unit Value for
the Sub-Account as of the immediately preceding APCD;
Dividing the resultant factor by one (1.00) plus the interest rate option
to the n/365 power where n is the number of days from the immediately
preceding APCD to the subsequent APCD; and
Multiplying this factor times the Annuity Unit Value as of the immediately
preceding APCD.
<TABLE>
<CAPTION>
Illustration of Calculation of Annuity Unit Value
<S> <C>
1. Annuity Unit Value as of immediately preceding Annuity Payment Calculation Date................... $11.0000
2. Accumulation Unit Value as of Annuity Payment Calculation Date.................................... $20.0000
3. Accumulation Unit Value as of immediately preceding Annuity Payment Calculation Date.............. $19.0000
4 Interest Rate..................................................................................... 6.00%
5. Interest Rate Factor (30 days).................................................................... 1.0048
6. Annuity Unit Value as of Annuity Payment Calculation Date = 1 times 2 divided by 3
divided by 5...................................................................................... $11.5236
<CAPTION>
Illustration of Annuity Payments
<S> <C>
1. Annuity Conversion Amount as of Participant's initial Annuity Payment Calculation
Date............................................................................................ $100,000.00
2. Assumed Annuity Conversion Factor per $1 of Monthly Income for an individual age 65
selecting a Life Annuity with Assumed Interest Rate of 6%....................................... $138.63
3. Participant's initial Annuity Payment = 1 divided by 2.......................................... $721.34
4. Assumed Annuity Unit Value as of Participant's initial Annuity Payment Calculation
Date............................................................................................ $11.5236
5. Number of Annuity Units = 3 divided by 4........................................................ 62.5968
6. Assumed Annuity Unit Value as of Participant's second Annuity Payment Calculation
Date............................................................................................ $11.9000
7. Participant's second Annuity Payment = 5 times 6................................................ $744.90
</TABLE>
3
<PAGE>
PERFORMANCE CALCULATIONS
Standard Total Return Calculation
The Variable Investment Division may advertise average annual total return
information calculated according to a formula prescribed by the Securities
and Exchange Commission ("SEC"). Average annual total return shows the
average annual percentage increase, or decrease, in the value of a
hypothetical Contribution allocated to a Sub-Account from the beginning to
the end of each specified period of time. The SEC standardized version of
this performance information is based on an assumed Contribution of $1,000
allocated to a Sub-Account at the beginning of each period and surrender or
withdrawal of the value of that amount at the end of each specified period,
giving effect to any charges and fees applicable under the Contract. This
method of calculating performance further assumes that (i) a $1,000
Contribution was allocated to a Sub-Account and (ii) no transfers or
additional payments were made. Premium taxes are not included in the terms
"charges" for purposes of this calculation. Average annual total return is
calculated by finding the average annual compounded rates of return of a
hypothetical Contribution that would compare the Accumulation Unit value on
the first day of the specified period to the ending redeemable value at the
end of the period according to the following formula:
T = (ERV/C) 1/n - 1
Where T equals average annual total return, where ERV (the ending redeemable
value) is the value at the end of the applicable period of a hypothetical
Contribution of $1,000 made at the beginning of the applicable period, where C
equals a hypothetical Contribution of $1,000, and where n equals the number of
years.
Non-Standardized Calculation of Total Return Performance
In addition to the standardized average annual total return information
described above, we may present total return information computed on bases
different from that standardized method. The Variable Investment Division may
present total return information computed on the same basis as the
standardized method except that charges deducted for the hypothetical
Contribution will not include any Annual Administration Charge. The total
return percentage under this method will be higher than the resulting from the
standardized method.
The Sub-Accounts also may present total return information calculated by
subtracting a Sub-Account's Accumulation Unit Value at the beginning of a period
from the Accumulation Unit Value of that Sub-Account at the end of the period
and dividing that difference (in that Sub-Account's Accumulation Unit Value) by
the Accumulation Unit Value of that Sub-Account at the beginning of the period.
This computation results in a total growth rate for the specified period which
we annualize in order to obtain the average annual percentage change in the
Accumulation Unit Value for the period used.
4
<PAGE>
This method of calculating performance does not take into account the
Contract Annual Administration charge and premium taxes, and assumes no
transfers. Such percentages would be lower if these charges were included in the
calculation.
In addition, the Variable Investment Division may present actual aggregate total
return figures for various periods, reflecting the cumulative change in value of
an investment in the Variable Investment Division for the specified period.
Performance Information
The tables below provide performance information for each Sub-Account for
specified periods ending December 31, 1995. The performance information is
based on historical performance of the underlying Funds adjusted for charges
applicable to the Variable Annuity I Separate Account. This information does
not indicate or represent future performance.
Total Return
Total returns quoted in sales literature or advertisements reflect all aspects
of a Sub-Account's return. Average annual returns are calculated by determining
the growth or decline in value of a hypothetical historical investment in the
Sub-Account over a stated period of time, and then calculating the annually
compounded percentage rate that would have produced the same result if the rate
of growth or decline had been constant over the period. Contractholders and
participants should recognize that average annual returns represent averaged
returns rather than actual year-to-year performance.
VA-I Sub-Accounts have inception dates as follows: Index Account - 12/12/89;
Balanced Account, Asset Manager Account, Growth I Account and Growth II Account
- - 5/1/91; and Equity-Income Account, Socially Responsible Account, International
Stock Account, and Small Cap Account - 5/2/94. However, the respective
underlying funds in which the Sub-Accounts invest had performance history
prior to the Sub-Accounts' inception. Performance information covering those
periods reflects a hypothetical return as if the funds were part of the VA-I
Separate Account at that time, using the charges applicable to the Contracts.
THE TABLES BELOW WILL BE FILED BY AMENDMENT
5
<PAGE>
Table 1A below assumes a hypothetical investment of $1,000 at the beginning of
the period via the Sub-Account investing in the applicable fund and withdrawal
of the investment on 12/31/95. The rates thus reflect the mortality and
expense risk charge and a pro rata portion of the Annual Administrative
Charge. Table 1B shows the cumulative total return on the same basis for the
period ending 12/31/95.
TABLE 1A -- STANDARD AVERAGE ANNUAL TOTAL RETURN
<TABLE>
<CAPTION>
LIFE
1 YEAR 3 YEARS 5 YEARS OF ACCT
INCEPTION ENDING ENDING ENDING ENDING
DATE 12/31/95 12/31/95 12/31/95 12/31/95
<S> <C> <C> <C> <C> <C>
Fund VIP II: Asset Manager 09/06/89
(Asset Manager)
Calvert Responsibly Invested Balanced Portfolio 09/02/86
(Socially Responsible)
TCI Balanced 05/01/91
(Balanced)
VIP Equity-Income 10/09/86
(Equity-Income)
Dreyfus Stock Index 09/29/89
(Index Account)
Fund VIP Growth 10/09/86
(Growth I)
TCI Growth 11/20/87
(Growth II)
T. Rowe Price International Stock 03/31/94
Portfolio (International Stock)
Dreyfus Small Cap 08/31/90
(Small Cap)
</TABLE>
TABLE 1B -- CUMULATIVE TOTAL RETURN
<TABLE>
<CAPTION>
LIFE
YEAR TO 1 YEAR 3 YEARS 5 YEARS OF ACCT
INCEPTION QUARTER DATE ENDING ENDING ENDING ENDING
DATE 12/31/95 12/31/95 12/31/95 12/31/95 12/31/95 12/31/95
<S> <C> <C> <C> <C> <C> <C> <C>
Fund VIP II: Asset Manager 09/06/89
(Asset Manager)
Calvert Responsibly Invested Balanced Portfolio 09/02/86
(Socially Responsible)
TCI Balanced 05/01/91
(Balanced)
VIP Equity-Income 10/09/86
(Equity-Income)
Dreyfus Stock Index 09/29/89
(Index)
Fund VIP Growth 10/09/86
(Growth I)
TCI Growth 11/20/87
(Growth II)
T. Rowe Price International Stock 03/31/94
Portfolio (International Stock)
Dreyfus Small Cap 08/31/90
(Small Cap)
</TABLE>
6
<PAGE>
Table 2A and 2B show performance information on the same assumptions as Tables
1A and 1B except that Tables 2A and 2B do not reflect deductions of the pro rata
portion of the Annual Administrative Charge because certain Contract and
Participants are not assessed such a charge.
TABLE 2A -- AVERAGE ANNUAL TOTAL RETURN ASSUMING NO ANNUAL ADMINISTRATIVE CHARGE
<TABLE>
<CAPTION>
LIFE
1 YEAR 3 YEARS 5 YEARS OF ACCT
INCEPTION ENDING ENDING ENDING ENDING
DATE 12/31/95 12/31/95 12/31/95 12/31/95
<S> <C> <C> <C> <C> <C>
Fund VIP II: Asset Manager 09/06/89
(Asset Manager)
Calvert Responsibly Invested Balanced Portfolio 09/02/86
(Socially Responsible)
TCI Balanced 05/01/91
(Balanced)
VIP Equity-Income 10/09/86
(Equity-Income)
Dreyfus Stock Index 09/29/89
(Index Account)
Fund VIP Growth 10/09/86
(Growth I)
TCI Growth 11/20/87
(Growth II)
T. Rowe Price International Stock 03/31/94
Portfolio (International Stock)
Dreyfus Small Cap 08/31/90
(Small Cap)
</TABLE>
TABLE 2B -- CUMULATIVE TOTAL RETURN ASSUMING NO ANNUAL ADMINISTRATIVE CHARGE
<TABLE>
<CAPTION>
LIFE
YEAR TO 1 YEAR 3 YEARS 5 YEARS OF ACCT
INCEPTION QUARTER DATE ENDING ENDING ENDING ENDING
DATE 12/31/95 12/31/95 12/31/95 12/31/95 12/31/95 12/31/95
<S> <C> <C> <C> <C> <C> <C> <C>
Fund VIP II: Asset Manager 09/06/89
(Asset Manager)
Calvert Responsibly Invested Balanced Portfolio 09/02/86
(Socially Responsible)
TCI Balanced 05/01/91
(Balanced)
VIP Equity-Income 10/09/86
(Equity-Income)
Dreyfus Stock Index 09/29/89
(Index)
Fund VIP Growth 10/09/86
(Growth I)
TCI Growth 11/20/87
(Growth II)
T. Rowe Price International Stock 03/31/94
Portfolio (International Stock)
Dreyfus Small Cap 08/31/90
(Small Cap)
</TABLE>
7
<PAGE>
Table 3 below shows total return information on a calendar year basis using
the same assumptions as Tables 2A and 2B. The rates of return shown reflect
the mortality and expense risk charge. Similar to Tables 2A and 2B, Table 3
does not reflect deductions of the pro rata portion of the Annual
Administrative Charge because certain Contracts and Participants are not
assessed such a charge.
TABLE 3 -- CALENDAR YEAR ANNUAL RETURN ASSUMING
NO ANNUAL ADMINISTRATIVE CHARGE*
<TABLE>
<CAPTION>
1987 1988 1989 1990 1991 1992 1993 1994 1995
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Asset Manager na na na 5.45 21.11 10.53 19.60 -7.20
Socially Responsible 5.51 10.42 19.53 2.94 15.02 6.33 6.72 -4.39
Balanced na na na na na -7.17 6.38 -0.58
Equity-Income -2.30 21.25 15.95 -16.29 29.88 15.50 16.89 5.80
Index na na na -4.69 28.29 5.82 8.02 -0.32
Growth I 2.43 14.21 29.95 -12.78 43.78 8.00 17.94 -1.21
Growth II na -3.41 27.17 -2.40 40.18 -2.52 8.99 -2.34
International Stock na na na na na na na na
Small Cap na na na na 156.65 69.25 66.31 6.47
</TABLE>
*The above calendar-year returns assume a hypothetical investment of $1,000 on
January 1 of the first full calendar year that the underlying fund was in
existence. The returns assume that the money will be left on account until
retirement. Returns are provided for years before the fund was an available
investment option under the contract. Returns for those periods reflect a
hypothetical return as if those funds were available under the contract, and
reflect the deduction of the mortality and expense risk charge. The returns
do not reflect deductions for the pro rata portion of the Annual
Administrative Charge.
TAX LAW CONSIDERATIONS
Retirement Programs:
Participants are urged to discuss the income taxes considerations of their
retirement plan with their tax advisors. In many situations special rules may
apply to the plans and/or to the participants.
Contributions to retirement programs subjects to Sections 401(a), 403(a),
403(b), 408 and 457(b) may be excludable from a Participant's reportable gross
income if the Contributions do not exceed the limitations imposed under the
Code. Certain plans allow employees to make Elective Salary Deferral
Contributions. Certain Plans allow Employers to make Contributions. The
information below is a brief summary of some the important federal tax
considerations that apply to retirement plans. The Code requires that 401(a)
Plans and certain 403(b) Plans be in writing and that the Employer communicate
the provisions of the Plans to employees. When there is a written Plan, often
the Contribution limits, withdrawal rights and other provisions of the Plan may
be more restrictive than those allowed by the Code.
Elective Salary Deferral Contributions
For calendar year 1996 the maximum elective salary deferral contributions to a
401(k) Plan which is a type of 401(a) Plan is limited to $9,500; For a 403(b)
plan the limit is $9,500 unless the employee is a qualified employees; For a
Eligible 457 Plan the limit is $7,500. When an employee is covered by two or
more of these Plans, the elective salary deferral contribution limits for all
the Plans must be coordinated.
8
<PAGE>
Total Salary Deferral & Employer Contributions
QUALIFIED RETIREMENT PLAN - 401(a) PLAN
The Code limits the Contributions to a defined contribution 401(a) plan to the
lesser of $30,000 or 25% of compensation.
TAX SHELTERED ANNUITY PLAN - 403(b) PLAN
Total contributions which include both salary deferral contributions and
employer contributions are also limited.
The combined limit is:
(a) the amount determined by multiplying 20 percent of the employee's
includable compensation by the number of years of service, over
(b) the aggregate of the amount contributed by the employer for annuity
contracts and excludable from the gross income of the employee for the prior
taxable year.
Therefore, if the maximum exclusion allowance is less than $9500 a year, the
employee's elective deferrals plus any other employer Contributions cannot
exceed this lesser amount.
Section 415 of the Code imposes limitations with respect to annual contributions
to all Section 403(b) programs, qualified plans and simplified employee pensions
maintained by the Employer. A Participant's annual contributions to these
programs and defined contribution plans cannot exceed the lesser of $30,000 or
25 percent of the employee's compensation. This amount is subject to the maximum
exclusion allowance and the salary deferral amount limitations.
ELIGIBLE 457 PLAN - 457(b) PLAN
For a 457(b) plan the contribution is the lesser of $7,500 or 33% of the
employee's compensation.
SECTION 457(f) PLANS
These are non-qualified deferred compensation arrangements between an Employer
and its employees. There are no stated limits in the Code regarding this type
of Plan.
INDIVIDUAL RETIREMENT ACCOUNT - IRA OR 408 PLAN
For IRA's the maximum deductible contribution is the lesser of $2,000 or 100% of
taxable income. The $2,000 is increased to $2,250 when the IRA covers the
taxpayer and a non-working spouse.
Transfers and Rollovers
Participants who receive distributions from their 401(a) or 403(b)
contract may transfer the amount not representing employee contributions to an
Individual Retirement Account or Annuity (IRA) or another Section 401(a) or
403(b) program without including that amount in gross income for the taxable
year in which paid. Note 401(a) distributions may not be transferred to a 403(b)
plan or vice versa. If the rollover amount is paid directly to the Participant,
the amount distributed may be subject to a 20% federal tax withholding. If the
amount is paid directly to an acceptable rollover account, UNUM/America is not
required to withhold any amount. In order for the distribution to qualify for
rollover, the distribution must be made on account of the employee's death,
after the employee attains age 59 1/2, on account of the employee's
separation from service, or after the employee has become disabled. The
distribution cannot be part of a series of substantially equal payments made
over the life expectancy of the employee or the joint life expectancies of
the employee and his or her spouse or made for a specified period of 10 years
or more. The rollover must be made within sixty days of the distribution.
9
<PAGE>
Pursuant to Revenue Ruling 90-24, a Participant, to the extent permitted by any
applicable Contract or Plan, may transfer funds between Section 403(b)
investment vehicles, including both Section 403(b)(1) annuity contracts and
Section 403(b)(7) custodial accounts. Any amount transferred must continue to be
subject to withdrawal restrictions at least as restrictive as that of the
transferring investment vehicle. UNUM/America considers any total or partial
transfer from a UNUM/America investment vehicle to a non-UNUM/America investment
vehicle to be a withdrawal.
Once every twelve months a participant in an IRA may roll the money from one IRA
to another IRA.
In Eligible 457 Plans and in Section 457(f) Plans, the Employer controls the
movement of assets from one funding vehicle to another.
Excise Tax on Early Distributions
Section 72(t) of the Code provides that any distribution made to a
Participant in a 401(a), 403(b) or 408 plan other than on account of the
following events will be subject to a 10 percent excise tax on the taxable
amount distributed:
a) the employee has attained age 59 1/2;
b) the employee has died;
c) the employee is disabled;
d) the employee is 55 and has separated from service (Does not apply to
IRA's).
Distributions which are received as a life annuity where payment is made at
least annually will not be subject to an excise tax. Certain amounts paid for
medical care may also not be subject to an excise tax.
Minimum Distribution Rules
The value in a contract under Sections 401(a), 403(b) and 408 are subject to the
distribution rules provided in Section 401(a)(9) of the Code. Generally, that
section requires that an employee must begin receiving distributions of his
post-1986 balance by April 1 of the calendar year following the calendar year in
which the employee attains age 70 1/2. Such distributions must not exceed the
life expectancy of the employee or the life expectancy of such employee and the
designated beneficiary (as defined under the plan). An employee who attained age
70 1/2 before January 1, 1988 must begin receiving distributions by April 1 of
the calendar year following the later of (a) the calendar year in which the
employee attains age 70 1/2 or (b) the calendar year in which the employee
retires. There are special rules for Section 403(b) Plans.
Amounts contributed to an Eligible 457 contract must be distributed not earlier
than the earliest of : 1) calendar year in which the Participant attains age 70
1/2, 2) the Participant separates from service with the Employer, or 3) when
the Participant has an unforeseen emergency. However, in no event may the
distribution begin any later than described in Sections 401(a)(9) and 457(d) of
the Code.
Additionally, distribution of an employee's entire account balance (including
pre-1987 funds) must satisfy the minimum distribution incidental benefit
requirement. In general, this requires that death and other non-retirement
benefits payable under the above plans be incidental to the primary purpose of
the program which is to provide deferred compensation to the employee. A payee
is subject to a penalty for failing to receive the required minimum annual
distribution. Section 4974(a) of the Code provides that a payee will be subject
to a penalty equal to 50 percent of the amount by which the required minimum
distribution exceeds the actual amount distributed during the taxable year.
Additional information on federal income taxation is included in the prospectus.
10
<PAGE>
DISTRIBUTION OF CONTRACTS
UNUM Sales Corporation (UNUM Sales), a subsidiary of UNUM Corporation, is
registered with the Securities and Exchange Commission as a broker-dealer under
The Securities Exchange Act of 1934 and is a member of the National Association
of Securities Dealers, Inc. UNUM Sales is the Variable Investment Division's
principal underwriter and also enters into selling agreements with other
unaffiliated broker-dealers authorizing them to offer the Contracts. UNUM Sales
will pay these unaffiliated broker-dealers a distribution allowance which will
be used to pay commissions to their registered representatives. This
distribution allowance will not be deducted from Participant Contributions or
Account balances but will be paid from UNUM/America's General Account assets
(including any charges collected). Lincoln Life has agreed to serve as the
principal underwriter of the Contracts as of the Closing Date. The principal
underwriter is registered as a broker-dealer with the Securities and Exchange
Commission and is a member of the National Association of Securities Dealers,
Inc. It is anticipated that Lincoln Life will enter into sales agreements with
unaffiliated broker-dealers for the sale of the Contracts.
CUSTODIAN
UNUM/America is the custodian for the Fund's shares owned by the Variable
Investment Division. The Fund's shares are held in uncertificated form separate
and apart from UNUM/America's other assets.
INDEPENDENT AUDITORS/ACCOUNTANTS
Coopers & Lybrand L.L.P., 130 Middle Street, Portland, Maine 04104-5059,
independent accountants, performs certain accounting services for UNUM/America
and have performed the same services for the Variable Investment Division. The
financial statements included in this SAI have been audited to the extent and
for the periods indicated in their reports thereon. Those financial statements
have been included herein in reliance reports given upon the authority of such
firm as experts in auditing and accounting.
FINANCIAL STATEMENTS
This SAI contains financial statements for the Variable Investment Division, as
of December 31, 1995 and for the two years then ended.
The financial statements of UNUM/America which are included in this SAI, should
be considered only as bearing on the ability of UNUM/America to meet its
obligations under the Contracts. The financial statements of UNUM/America are
presented in accordance with generally accepted accounting principles.
FINANCIAL STATEMENTS WILL BE PROVIDED BY AMENDMENT.
11
<PAGE>
PART C
OTHER INFORMATION
Item 24. Financial statements and Exhibits
(a) The following financial statements are included in Part B:
Financial Statements of Registrant - VA-I Separate Account of UNUM Life
Insurance Company of America.
Audited statement of assets and liabilities as of December 31, 1995
and statement of operations and changes in net assets for the year
ended December 31, 1995.
Financial Statements of Depositor - UNUM Life Insurance Company of America.
Audited balance sheets as of December 31, 1995 and 1994 and audited
statements of income, stockholder's equity and cash flows for each of
the three years in the period ended December 31, 1995.
(b) Exhibits
* 1. Resolution adopted by the Board of Directors of UNUM Life
Insurance Company on July 8, 1988 establishing the TSAVA Separate
Account of UNUM Life Insurance Company.
*** 1(a) Resolution adopted by the Board of Directors of UNUM Life
Insurance Company on February 7, 1991 changing the name and
broadening the scope of the VA-I Separate Account.
// 1(b) Resolution adopted by the Board of Directors and the Stockholders
of UNUM Life Insurance Company on September 13, 1991, authorizing
the merger of UNUM Life Insurance Company and UNUM Life Insurance
Company of America.
// 1(c) Resolution adopted by the Board of Directors and the Stockholders
of UNUM Life Insurance Company of America on September 13, 1991,
authorizing the merger of UNUM Life Insurance Company of America
and UNUM Life Insurance Company.
// 1(d) Plan of Merger for UNUM Life Insurance Company of America and
UNUM Life Insurance Company dated September 13, 1991.
2. Not applicable.
* 3(a) Distribution agreement between UNUM Life Insurance Company of
America and UNUM Sales Corporation.
<PAGE>
** 3(b) Broker-dealer sales agreement.
# 4(a) Forms of Group Annuity Contracts for UNUM Life Insurance Company
of America.
// 5(a) Form of application for Group Annuity Contract.
// 5(b) Form of Participant enrollment form (including acknowledgement of
restrictions on redemption imposed by I.R.C. Section 403(b)).
// 6. Copy of certificate of incorporation and by-laws of UNUM Life
Insurance Company of America.
#### 7(a) Form of Assumption Reinsurance Agreement by and between UNUM
Life Insurance Company of America and The Lincoln National
Life Insurance Company.
#### 7(b) Form of Coinsurance and Assumption Agreement by and between UNUM
Life Insurance Company of America and The Lincoln National
Life Insurance Company.
** 8(a) Participation Agreement between UNUM Life Insurance Company and
Dreyfus Life & Annuity Index Fund, Inc.
/ 8(b) Participation Agreement between UNUM Life Insurance Company and
Variable Insurance Products Fund I and Fidelity Distributors
Corporation.
/ 8(c) Participation Agreement between UNUM Life Insurance Company and
Variable Insurance Products Fund II and Fidelity Distributors
Corporation.
/ 8(d) Participation Agreement between UNUM Life Insurance Company and
Twentieth Century Management Company.
* 8(e) Service Agreement and Amendments between UNUM Life Insurance
Company and UNUM Sales Corporation.
# 8(f) Participation Agreement between UNUM Life Insurance Company of
America and Dreyfus Variable Investment Fund and Dreyfus
Corporation.
# 8(g) Participation Agreement between UNUM Life Insurance Company of
America and Acacia Capital Corporation.
# 8(h) Participation Agreement between UNUM Life Insurance Company of
America and T. Rowe Price.
#### 8(i) Form of Administrative Services Agreement by and between UNUM
Life Insurance Company of America and The Lincoln National
Life Insurance Company.
### 9. Consent and opinion of Kevin J. Tierney, General Counsel of UNUM
Life Insurance Company of America, as to the legality of the
securities being registered.
### 10(a) Consent of Coopers & Lybrand, Independent Accountants.
<PAGE>
// 10(b) Powers of Attorney.
++ 10(c) Power of Attorney for Elaine D. Rosen
11. No financial statements are omitted from Item 23 (other than any
that will be filed by subsequent amendment).
12. Not Applicable.
## 13. Schedule for computation of Performance Quotations
### 14. Financial Data Schedule
* Incorporated herein by reference to initial Registration Statement on
Form N-4 filed by the TSAVA Separate Account of UNUM Life Insurance
Company with the Securities and Exchange Commission on April 24, 1989.
** Incorporated herein by reference to Pre-effective Amendment No. 1 on
Form N-4 filed by the TSAVA Separate Account of UNUM Life Insurance
Company with the Securities and Exchange Commission on October 18,
1989.
*** Incorporated herein by reference to Post-effective Amendment No. 2
filed by the VA-I Separate Account of UNUM Life Insurance Company on
Form N-4 with the Securities and Exchange Commission on March 1, 1991.
/ Incorporated herein by reference to post-effective Amendment No. 3
filed by the VA-I Separate Account of UNUM Life Insurance Company on
Form N-4 with the Securities and Exchange Commission on May 1, 1991.
// Incorporated herein by reference to Amendment No. 4 filed by the VA-I
Separate Account of UNUM Life Insurance Company on November 1, 1991.
/// Incorporated herein by reference to Amendment No. 5 filed by the VA-I
Separate Account of UNUM Life Insurance Company of America on December
31, 1991.
//// Incorporated herein by reference to Amendment No. 7 filed by the VA-1
Separate Account of UNUM Life Insurance Company of America on February
14, 1992.
+ Incorporated herein by reference to Amendment No. 12 filed by the VA-I
Separate Account of UNUM Life Insurance Company of America on May 3,
1993.
++ Incorporated herein by reference to Amendment No. 15 filed by the VA-I
Separate Account of UNUM Life Insurance Company of America on March 2,
1994.
# Incorporated herein by reference to Amendment No. 18 filed by the VA-I
Separate Account of UNUM Life Insurance Company of America on May 2,
1994.
<PAGE>
## Incorporated herein by reference to Amendment No. 23 filed by the VA-I
Separate Account of First UNUM Life Insurance Company on May 1, 1995
### To be filed by Post Effective Amendment, May, 1996.
#### Text to be filed by Post-Effective Amendment, May, 1996.
Item 25. DIRECTORS AND OFFICERS OF THE DEPOSITOR
The following list contains the officers and directors of UNUM Life Insurance
Company of America who are engaged directly or indirectly in activities relating
to the VA-I Separate Account as well as the Contracts. The list also shows UNUM
Life Insurance Company of America's executive officers.
Name and Address Positions and Offices with UNUM/America
James F. Orr III Chairman of the Board of Directors
2211 Congress Street Chief Executive Officer
Portland, Maine 04122
Stephen B. Center Director and President
2211 Congress Street
Portland, Maine 04122
Robert W. Crispin Director and Executive Vice President
2211 Congress Street
Portland, Maine 04122
Kevin P. O'Connell Director and Executive Vice President
2211 Congress Street
Portland, Maine 04122
Elaine D. Rosen Director and Executive Vice President
2211 Congress Street
Portland, Maine 04122
Peter J. Moynihan Director and Senior Vice President
2211 Congress Street
Portland, Maine 04122
Gary E. Kirkner Senior Vice President
2211 Congress Street
Portland, ME 04122
Robert G. Ostrander Senior Vice President
2211 Congress Street
Portland, Maine 04122
<PAGE>
Peter S. Adams Vice President
2211 Congress Street
Portland, ME 04122
Diane M. Garofalo Vice President
2211 Congress Street
Portland, ME 04122
Lawrence H. Kolkhorst Vice President
2211 Congress Street
Portland, Maine 04122
Nicholas J. Desiderio Vice President and Chief Financial Officer
2211 Congress Street
Portland, Maine 04122
Kevin J. Tierney Director, Senior Vice President,
2211 Congress Street General Counsel and Secretary
Portland, Maine 04122
Item 26. Persons Controlled by or Under Common Control with UNUM Life
Insurance Company of America or the VA-I Separate Account
The VA-I Separate Account of UNUM Life Insurance Company of America
("UNUM/America") is a separate account of UNUM/America and may be deemed to be
controlled by UNUM/America although UNUM/America will follow voting instructions
of Contractholders with respect to voting on certain important matters requiring
a vote of Contractholders.
The following chart indicates the persons controlled or under common control
with UNUM/America and the VA-I Separate Account:
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
UNUM
CORPORATE STRUCTURE 1 CORPORATION DECEMBER 26, 1995
(DELAWARE)
----------
|
- ------------------------------------------------------------------------------------------------------------------------------------
| | | | | | | |
| UNUM Holding Commercial Life UNUM European Mindtask Limited Duncanson & Holt, Colonial Companies, UNUM Japan
| Company Insurance Holding (United Kingdom) Inc. Inc. Accident
| (Delaware) Company Company (New York) (Delaware) Insurance
| (Wisconsin) Limited Company
| (United Limited
| Kingdom) (Japan)
| ------------ --------------- ------------- ---------------- ---------------- ---------------- -----------
| | | | | |
| | First UNUM | Continental | UNUM Life | Duncanson | Colonial Life
| |- Life |- National |- Insurance |- & Holt |- & Accident
| | Insurance | Life | Company | Services, | Insurance
| | Company | Insurance | Limited | Inc. | Company
| | (New York) | Company | (United | (Maine) | (South
| | ---------- | (Delaware) | Kingdom) | ---------- | Carolina)
| | | | ------------ | --------- | | -------------
| | | NY Holdings | | | Group | |
| | | 1994-1 | Continental | UNUM |- Management | | CLA Holdings
| | | NY Holdings | International | Management | Services, | | 1994-1
| | | 1994-2 |- Life |- Company | Inc. | |- CLA Holdings
| | |- NY Holdings | Insurance | Limited | (Washington) | | 1994-2
| | | 1994-3 | Company | (United | ------------ | | (Maine)
| | | NY Holdings | (Delaware) | Kingdom) | | | ------------
| | | 1994-4 | ------------- | --------- | Duncanson |
| | | (Maine) | |- & Holt | BenefitAmerica,
| | | ----------- | UNUM | Europe Ltd. |- Inc.
| | |- Limited | (United | (South
| | UNUM Sales | (United | Kingdom) | Carolina)
| |- Corporation | Kingdom) | ----------- | ------------
| | (Delaware) | --------- | |
| | ----------- | | | | Duncanson
| | | | N.E.L. | |- & Holt
| | Claims | | Permanent | | (Contingency),
| |- Service | |- Health | | Ltd.
| | International, | | Insurances | | (United
| | Inc. | | Limited | | Kingdom)
| | (Delaware) | | (United | | ------------
| | ------------- | | Kingdom) | |
| | | | ----------- | | Duncanson
| | UNUM | | |- & Holt
| |- Development | Claims | | Underwriters
| | Corporation |- Services | | Ltd.
| | (Maine) | International | | (United
| | ----------- | Limited | | Kingdom)
| | | (United | | -------------
| | UNUM | Kingdom) | |
| |- International | ------------- | | Duncanson
| | Underwriters | | & Holt
| | Inc. | |- Agencies Ltd.
| | (Delaware) | | (United
| | ------------ | | Kingdom)
| | | | --------------
| | UNUM | |
| | Life | | Duncanson
| 2 |- Insurance | | & Holt
| Company | |- Syndicate
| of America | | Management
| (Maine) | | Ltd.
| ------------ | | (United
| UA Holdings | | Kingdom)
| 1994-1 | | -------------
| UA Holdings | |
| 1994-2 | | Trafalgar
|- UA Holdings | | Underwriting
| 1994-3 | |- Agencies Ltd.
| UA Holdings | | (United
| 1994-4 | | Kingdom)
| (Maine) | | -------------
| ----------- |
| |- Duncanson
| SP | & Holt
| Administrator, | Canada Ltd.
3 |- LLC | (Canada)
| (California) | -------------
| ----------- |
|- Duncanson
| & Holt
| Asia
| PTE Ltd.
| (Singapore)
| -----------
| |
| | MediScreen
| 4 |- Sdn. Bhd.
| | (Malaysia)
| | -------------
</TABLE>
1 Percentage of ownership is 100% unless otherwise indicated.
2 Reflects split ownership: 87.5% by UNUM Holding Company and 12.5% by UNUM
Corporation.
3 50% owned by UNUM Life Insurance Company of America; 50% owned by an entity
outside of UNUM Corporation's holding company structure.
4 14.95% owned by Duncanson & Holt, Inc.; 14.95% owned by Duncanson & Holt
Asia PTE Ltd.
<PAGE>
Item 27. Number of Contractholders
As of March 31, 1996, Registrant had ___ Contractholders.
Item 28. Indemnification
Under the Participation Agreements entered into between UNUM/America and the
Dreyfus Life & Annuity Index Fund, Inc., Dreyfus Variable Investment Fund and
Dreyfus Corporation, Variable Insurance Products Funds I and II and Fidelity
Distributors Corporation, Twentieth Century Management Company, Acacia Capital
Corporation, and T. Rowe Price (the "Funds"), UNUM/America and its directors,
officers, employees, agents and control persons have been indemnified by the
Funds against any losses, claims or liabilities that arise out of any untrue
statement or alleged untrue statement or omission of a material fact in the
Funds' registration statements, prospectuses or sales literature. In addition,
the Funds will indemnify UNUM/America against any liability, loss, damages,
costs or expenses which UNUM/America may incur as a result of the Funds'
incorrect calculations, incorrect reporting and/or untimely reporting of the
Funds' net asset values, dividend rates or capital gain distribution rates.
UNUM/America's by-laws provide that UNUM/America "may indemnify any
person made or threatened to be made a party of any action or proceeding,
including an action by or in the right of any other corporation of any type or
kind, domestic or foreign, which any director, officer or employee of the
Corporation served in any capacity at the request of the Corporation, by reason
of the fact that he, his testator or intestate, was a director, officer or
employee of the Corporation or served such other corporation in any capacity,
against judgments, fines, amounts paid in settlement and reasonable expenses,
including attorneys' fees, actually and necessarily incurred as a result of such
action or proceeding, or any appeal therein, if such director, officer, or
employee acted, in good faith, for a purpose which he or she reasonably believed
to be in the best interests of the corporation."
Insofar as indemnification for liability arising under the Securities Act of
1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities Act
of 1933 and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act of 1933 and will be governed by the final adjudication of such issue.
<PAGE>
Item 29. Principal Underwriter
(a) Not Applicable
(b)(1) The following table sets forth certain information regarding the
officers and directors of UNUM Sales Corporation:
Name and Principal Business Position and Offices
Address with Underwriter
Peter S. Adams President and
2211 Congress Street Director
Portland, Maine 04122
Lawrence H. Kolkhorst Vice President
2211 Congress Street
Portland, Maine 04122
Clifford R. Murch Treasurer
2211 Congress Street
Portland, ME 04122
Ann C. Madigan Secretary
2211 Congress Street
Portland, Maine 04122
Stephen B. Center Director
2211 Congress Street
Portland, Maine 04122
Gary E. Kirkner Director
2211 Congress Street
Portland, Maine 04122
<PAGE>
c)
Name of Net Underwriting
Principal Discounts and Compensation Brokerage
Underwriter Commissions on Redemption Commissions Compensation
- ----------- ----------- ------------- ----------- ------------
UNUM Sales TO BE FILED BY AMENDMENT N/A N/A N/A
Corporation
Item 30. Location of Accounts and Records
The records required to be maintained by Section 31(a) of the Investment
Company Act of 1940 and Rules 31a-1 to 31a-3 thereunder are maintained by
UNUM/America at 2211 Congress Street, Portland, Maine 04122.
Item 31. Management Services
None
<PAGE>
Item 32. Undertakings
The Registrant hereby undertakes:
(a) to file a post-effective amendment to this registration statement as
frequently as is necessary to ensure that the audited financial statements
in this registration statement are never more than 16 months old for so
long as payments under the variable annuity contracts may be accepted,
unless otherwise permitted.
(b) to include either (1) as part of any application to purchase a contract
offered by the prospectus, a space that an applicant can check to request a
Statement of Additional Information, or (2) a post card or similar written
communication affixed to or included in the prospectus that the applicant
can remove to send for a Statement of Additional Information.
(c) To deliver any Statement of Additional Information and any financial
statements required to be made available under this Form promptly upon
written or oral request.
(d) The Registrant intends to rely on the no-action response dated November 28,
1988, from Ms. Angela C. Goelzer of the Commission staff to the American
Council of Life Insurance concerning the redeemability of Section 403(b)
annuity contracts and the Registrant has complied with the provisions of
paragraphs (1)-(4) thereof.
(e) The Registrant intends to offer Contracts to Participants in the Texas
Optional Retirement Program. In connection with that offering, Rule 6c-7
of the Investment Company Act of 1940 is being relied upon and paragraphs
(a)-(d) of that Section will be complied with.
<PAGE>
SIGNATURES
As required by the Securities Act of 1933 and the Investment Company Act of
1940, the Registrant and the Depositor have caused this Post-effective Amendment
to the Registration Statement to be signed on their behalf, in the City of
Portland, and State of Maine on this 28th day of February, 1996, and the
Registrant certifies that this Amendment is filed solely for one or more of the
purposes specified in Rule 485(b)(1) under the Securities Act of 1933 and that
no material event requiring disclosure in the prospectus, other than one listed
in Rule 485(b)(1), has occurred since the effective date of the most recent
Post-Effective Amendment to the Registration Statement which included a
prospectus.
VA-I Separate Account of
UNUM Life Insurance Company of America
(Registrant)
By: /s/ Stephen B. Center
---------------------------------
Stephen B. Center
President
Unum Life Insurance Company of America
UNUM Life Insurance Company of America
(Depositor)
By: /s/ Stephen B. Center
---------------------------------
Stephen B. Center
President
As required by the Securities Act of 1933 this Post-effective Amendment to the
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
SIGNATURE TITLE DATE
/s/ Stephen B. Center February 28, 1996
- -------------------------
Stephen B. Center President
(Principal Executive Officer)
/s/ Nicholas J. Desiderio February 28, 1996
- -------------------------
Nicholas J. Desiderio Vice President and
Chief Financial Officer
(Principal Financial Officer)
/s/ Donald P. Boutin February 28, 1996
- -------------------------
Donald P. Boutin 2nd Vice President and
Controller
(Principal Accounting Officer)
<PAGE>
*
February 28, 1996
- -------------------------
Stephen B. Center Director
*
February 28, 1996
- -------------------------
Peter J. Moynihan Director
*
February 28, 1996
- -------------------------
James F. Orr, III Director
*
February 28, 1996
- -------------------------
Elaine D. Rosen Director
/s/ Robert W. Crispin February 28, 1996
- -------------------------
Robert W. Crispin Director
/s/ Kevin P. O'Connell February 28, 1996
- -------------------------
Kevin P. O'Connell Director
/s/ Kevin J. Tierney February 28, 1996
- -------------------------
Kevin J. Tierney Director
*By: /s/ Kevin J. Tierney February 28, 1996
---------------------------------
Kevin J. Tierney
Attorney-in-fact
