<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 27, 1998
REGISTRATION NO. 33-47927
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- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------
FORM S-6
POST-EFFECTIVE
AMENDMENT No. 7
To REGISTRATION STATEMENT Under THE SECURITIES ACT OF 1933
----------------
METROPOLITAN LIFE SEPARATE ACCOUNT UL
(EXACT NAME OF TRUST)
METROPOLITAN LIFE INSURANCE COMPANY
(NAME OF DEPOSITOR)
1 Madison Avenue
New York, New York 10010
(COMPLETE ADDRESS OF DEPOSITOR'S PRINCIPAL EXECUTIVE OFFICES)
----------------
GARY A. BELLER, ESQ.
Senior Executive Vice-President and General Counsel
Metropolitan Life Insurance Company
1 Madison Avenue
New York, New York 10010
(NAME AND COMPLETE ADDRESS OF AGENT FOR SERVICE)
----------------
Copies to:
GARY O. COHEN, ESQ. and THOMAS C. LAUERMAN, ESQ.
Freedman, Levy, Kroll & Simonds
1050 Connecticut Avenue, N.W.
Washington, D.C. 20036
----------------
It is proposed that the filing will become effective (check appropriate box)
[_] immediately upon filing pursuant to paragraph (b)
[_] on (date) pursuant to paragraph (b)
[X] On May 1, 1998 pursuant to paragraph (a)(1) of Rule 485
[_] on (date), pursuant to paragraph (a) of Rule 485
This filing is made in reliance on Rule 6c-3 and 6e-3(T) under the Investment
Company Act of 1940 to register an indefinite amount of interests in
Metropolitan Life Separate Account UL which funds certain variable universal
life insurance policies.
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<PAGE>
METROPOLITAN LIFE SEPARATE ACCOUNT UL
METROPOLITAN LIFE INSURANCE COMPANY
CROSS-REFERENCE TABLE
<TABLE>
<CAPTION>
ITEMS OF
FORM N-8B-2 CAPTIONS IN PROSPECTUS
- ----------- ----------------------
<S> <C>
1...................... Cover Page
2...................... SUMMARY--About Metropolitan Life
3...................... Inapplicable
4...................... SALES AND ADMINISTRATION OF THE POLICIES; SUMMARY--
About Metropolitan Life
5, 6, 7................ SEPARATE ACCOUNT AND METROPOLITAN SERIES FUND--The
Separate Account; STATE REGULATION
8...................... FINANCIAL STATEMENTS
9...................... Inapplicable
10(a)................... OTHER POLICY PROVISIONS--Owner; Beneficiary; Collat-
eral Assignment
10(b)................... OTHER POLICY PROVISIONS--Dividends
10(c), 10(d)............ DEFINITIONS--Valuation Date; SUMMARY--Surrender and
Surrender Charges; Partial Withdrawals; Free Look
Period; POLICY BENEFITS--Benefit at Final Date;
POLICY RIGHTS--Surrender and Withdrawal Privileges;
Exchange Privilege; PAYMENT AND ALLOCATION OF PRE-
MIUMS--Allocation of Premiums and Cash Value, Cash
Value Transfers; THE FIXED ACCOUNT--Transfers,
Withdrawals, Surrenders, and Policy Loans; OTHER
POLICY PROVISIONS--Payment and Deferment
10(e)................... PAYMENT AND ALLOCATION OF PREMIUMS--Policy Termina-
tion and Reinstatement
10(f)................... VOTING RIGHTS
10(g)(1)-(3), 10(h)(1)-
(3).................... RIGHTS RESERVED BY METROPOLITAN LIFE
10(g)(4), 10(h)(4)...... Inapplicable
10(i)................... POLICY BENEFITS--Death Benefits; Death Benefit Op-
tions; Cash Value; Optional Income Plans; Optional
Insurance Benefits; PAYMENT AND ALLOCATION OF PRE-
MIUMS--Issuance of a Policy; Premiums; Allocation
of Premiums and Cash Value; Policy Termination and
Reinstatement
11...................... SUMMARY--The Separate Account and the Metropolitan
Series Fund; The Fixed Account; SEPARATE ACCOUNT
AND METROPOLITAN SERIES FUND--Metropolitan Series
Fund
12(a)................... Cover Page
12(b), 12(e)............ Inapplicable
12(c), 12(d)............ SEPARATE ACCOUNT AND METROPOLITAN SERIES FUND--Met-
ropolitan Series Fund
</TABLE>
i
<PAGE>
<TABLE>
<CAPTION>
ITEMS OF
FORM N-8B-2 CAPTIONS IN PROSPECTUS
- ----------- ----------------------
<S> <C>
13(a), 13(b), 13(c), SUMMARY--The Separate Account and the Metropolitan
13(d)................... Series Fund; The Fixed Account; Fund Transfers and
Charges; Premium Expense Charges; Monthly Deduction
from Cash Value; Fund Investment Management Fees
and Direct Expenses; Increase in Specified Face
Amount Charge; Surrender and Surrender Charges;
CHARGES AND DEDUCTIONS; SEPARATE ACCOUNT AND METRO-
POLITAN SERIES FUND--The Separate Account; POLICY
BENEFITS--Change in Specified Face Amount; Increas-
es; Decreases; Effect of Changes in Specified Face
Amount on Charges and Guarantees
13(e).................... SALES AND ADMINISTRATION OF THE POLICIES
13(f), 13(g)............. Inapplicable
14....................... PAYMENT AND ALLOCATION OF PREMIUMS--Issuance of a
Policy; SALES AND ADMINISTRATION OF THE POLICIES
15....................... PAYMENT AND ALLOCATION OF PREMIUMS
16....................... SEPARATE ACCOUNT AND METROPOLITAN SERIES FUND--Met-
ropolitan Series Fund
17(a), 17(b)............. Captions referenced under Items 10(c), 10(d), 10(e)
and 10(i) above
17(c).................... Inapplicable
18(a), 18(c)............. SEPARATE ACCOUNT AND METROPOLITAN SERIES FUND
18(b), 18(d)............. Inapplicable
19....................... SALES AND ADMINISTRATION OF THE POLICIES; VOTING
RIGHTS; REPORTS
20(a), 20(b)............. RIGHTS RESERVED BY METROPOLITAN LIFE; SEPARATE AC-
COUNT AND METROPOLITAN SERIES FUND--The Separate
Account
20(c), 20(d), 20(e),
20(f)................... Inapplicable
21(a), 21(b)............. POLICY RIGHTS--Loan Privileges; OTHER POLICY PROVI-
SIONS--Payment and Deferment
21(c), 22................ Inapplicable
23....................... SALES AND ADMINISTRATION OF THE POLICIES
24....................... OTHER POLICY PROVISIONS
25....................... SUMMARY--About Metropolitan Life
26....................... CHARGES AND DEDUCTIONS--Other Charges
27....................... SUMMARY--About Metropolitan Life
28....................... MANAGEMENT
29....................... Inapplicable
30, 31, 32, 33, 34....... Inapplicable
35....................... STATE REGULATION
36, 37................... Inapplicable
</TABLE>
ii
<PAGE>
<TABLE>
<CAPTION>
ITEMS OF
FORM N-8B-2 CAPTIONS IN PROSPECTUS
- ----------- ----------------------
<S> <C>
38....................... SALES AND ADMINISTRATION OF THE POLICIES; DISTRIBU-
TION OF THE POLICIES
39....................... SUMMARY--About Metropolitan Life; SALES AND ADMINIS-
TRATION OF THE POLICIES; DISTRIBUTION OF THE POLI-
CIES
40(a).................... Inapplicable
40(b).................... SEPARATE ACCOUNT AND METROPOLITAN SERIES FUND--Met-
ropolitan Series Fund; CHARGES AND DEDUCTIONS--
Other Charges
41(a).................... SUMMARY--About Metropolitan Life; SALES AND ADMINIS-
TRATION OF THE POLICIES
41(b), 41(c), 42, 43..... Inapplicable
44(a).................... SEPARATE ACCOUNT AND METROPOLITAN SERIES FUND--Met-
ropolitan Series Fund; POLICY BENEFITS--Cash Value
44(b).................... Inapplicable
44(c).................... CHARGES AND DEDUCTIONS--Monthly Deduction From Cash
Value
45....................... Inapplicable
46....................... Captions referenced under Item 44 above
47....................... Captions referenced under Items 10(c) and 16 above
48, 49................... Inapplicable
50....................... SEPARATE ACCOUNT AND METROPOLITAN SERIES FUND--The
Separate Account
51(a), 51(b)............. SUMMARY--About Metropolitan Life; Cover Page; POLICY
BENEFITS--Optional Insurance Benefits; POLICY
RIGHTS--Exchange Privilege
51(c), 51(d), 51(e)...... Captions referenced under Item 10(i) above
51(f).................... PAYMENT AND ALLOCATION OF PREMIUMS--Policy Termina-
tion and Reinstatement
51(g).................... Captions referenced under Items 10(i) and 13 above
51(h), 51(j)............. Inapplicable
51(i).................... DISTRIBUTION OF THE POLICIES
52(a), 52(c)............. RIGHTS RESERVED BY METROPOLITAN LIFE
52(b), 52(d)............. Inapplicable
53(a).................... FEDERAL TAX MATTERS
53(b), 54 through 58..... Inapplicable
59....................... FINANCIAL STATEMENTS
</TABLE>
iii
<PAGE>
MAY 1, 1998
PROSPECTUS
for
FLEXIBLE PREMIUM MULTIFUNDED LIFE INSURANCE POLICIES
(Minimum Initial Specified Face Amount $25,000, $50,000 or $100,000 Depending
on Age and Underwriting Class)
Issued by
METROPOLITAN LIFE INSURANCE COMPANY
The individual flexible premium multifunded life insurance policies
("Policies") offered by this Prospectus are issued by Metropolitan Life
Insurance Company ("Metropolitan Life") and are designed to provide lifetime
insurance coverage on the insureds named in the Policies, as well as
flexibility in connection with premium payments and death benefits. This
flexibility allows an owner of a Policy to provide for changing insurance
needs within the confines of a single insurance policy.
The Policy provides for a death benefit payable at the insured's death as
long as the Policy is still in effect. The Policy provides a guaranteed
minimum death benefit with a choice of durations, subject to certain
conditions. Generally, a Policy owner may choose either Death Benefit Option A
(the death benefit is fixed in amount), Death Benefit Option B (the death
benefit includes the Policy's cash value in addition to a fixed insurance
amount), or Death Benefit Option C (the death benefit includes the Policy's
cash value in addition to a fixed insurance amount if the insured dies prior
to the Policy anniversary on which the insured is 65 and is fixed in amount if
death occurs thereafter). If greater than the death benefit otherwise payable
under Option A, B or C, an alternative death benefit equivalent to a
percentage of the cash value will be paid.
The Policy's cash value will vary with the investment experience of the
Metropolitan Life Separate Account UL ("Separate Account") investment
divisions to which amounts are allocated and the fixed rates of interest
earned by allocations to a fixed interest account within the General Account
of Metropolitan Life (the "Fixed Account"). The cash value will also be
adjusted for other factors, including the amount of charges imposed and the
premium payments made. The Policy owner may withdraw or borrow a portion of
the Policy's cash surrender value, or the Policy may be fully surrendered, at
any time, subject to certain limitations and charges.
The premiums paid, less premium expense charges, will be allocated at the
owner's discretion among one or more Separate Account investment divisions
and/or the Fixed Account. The assets in each investment division are invested
in shares of a corresponding portfolio of the Metropolitan Series Fund, Inc.
("Fund"). Metropolitan Life is the investment manager of the Fund and the
distributor of its shares. Metropolitan Life also distributes and administers
the Policies. The prospectus for the Fund describes the investment objectives
and certain attendant risks of the portfolios of the Fund. The following chart
lists the name of each portfolio available in this Policy and the Company that
has the day-to-day investment management responsibility with respect to each
such Portfolio.
<TABLE>
<CAPTION>
PORTFOLIO PORTFOLIO MANAGER
--------- -----------------
<C> <S>
State Street Research International Stock State Street Research &
Management Company (sub-
investment manager) and GFM
International Investors, Inc.
(sub-sub-investment manager)
--------------------------------------------------------------------------
Janus Mid Cap Janus Capital Corporation
--------------------------------------------------------------------------
Loomis Sayles High Yield Bond Loomis, Sayles & Company, L.P.
--------------------------------------------------------------------------
Metropolitan Life Insurance
MetLife Stock Index Company
--------------------------------------------------------------------------
Scudder Kemper Investments,
Scudder Global Equity Inc.
--------------------------------------------------------------------------
State Street Research &
State Street Research Aggressive Growth Management Company
--------------------------------------------------------------------------
State Street Research &
State Street Research Diversified Management Company
--------------------------------------------------------------------------
State Street Research &
State Street Research Growth Management Company
--------------------------------------------------------------------------
State Street Research &
State Street Research Income Management Company
--------------------------------------------------------------------------
T. Rowe Price Small Cap Growth T. Rowe Price Associates, Inc.
</TABLE>
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
INTERESTS IN THE SEPARATE ACCOUNT AND THE FIXED ACCOUNT ARE NOT DEPOSITS OR
OBLIGATIONS OF, OR INSURED, OR GUARANTEED BY THE U.S. GOVERNMENT, ANY BANK OR
OTHER DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE FEDERAL DEPOSIT
INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER AGENCY, ENTITY
OR PERSON, AND ARE SUBJECT TO INVESTMENT RISK, INCLUDING THE POSSIBLE LOSS OF
THE PRINCIPAL AMOUNT INVESTED.
THIS PROSPECTUS IS NOT VALID UNLESS ATTACHED TO THE CURRENT PROSPECTUS FOR THE
METROPOLITAN SERIES FUND, INC., WHICH CONTAINS ADDITIONAL INFORMATION ABOUT
THE FUND.
THIS PROSPECTUS SHOULD BE READ AND RETAINED FOR FUTURE REFERENCE.
1 Madison Avenue, New York, New York 10010 Telephone (800) 638-5000
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
DEFINITIONS............................... 3
SUMMARY................................... 6
Purpose of Summary....................... 6
About Metropolitan Life.................. 6
Policy in Brief.......................... 6
Premiums................................. 6
The Guaranteed Minimum Death Benefit..... 6
Cash Value............................... 7
Benefits and Riders...................... 7
Death Benefit Options.................... 7
The Fixed Account........................ 7
The Separate Account and the Metropolitan
Series Fund............................. 7
The Funding Options...................... 7
Automated Investment Strategies.......... 8
Fund Transfers and Charges............... 8
Premium Expense Charges.................. 8
Monthly Deduction From Cash Value........ 8
Increase in Specified Face Amount Charge. 8
Surrender and Surrender Charges.......... 9
Partial Withdrawal....................... 9
Loans.................................... 9
Fund Investment Management Fees and Di-
rect Expenses........................... 9
Free Look Period......................... 10
Tax Treatment of Cash Value.............. 10
Tax Treatment of the Death Benefit....... 10
Communications........................... 10
SEPARATE ACCOUNT AND METROPOLITAN
SERIES FUND.............................. 11
The Separate Account..................... 11
Metropolitan Series Fund................. 11
POLICY BENEFITS........................... 12
Death Benefits........................... 12
Death Benefit Options.................... 12
Cash Value............................... 15
Benefit at Final Date.................... 16
Optional Income Plans.................... 16
Optional Insurance Benefits.............. 16
PAYMENT AND ALLOCATION OF PREMIUMS........ 17
Issuance of a Policy..................... 17
Premiums................................. 17
Allocation of Premiums and Cash Value.... 18
</TABLE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Policy Termination and Reinstatement.................................... 20
CHARGES AND DEDUCTIONS................................................... 20
Premium Expense Charges................................................. 20
Transfer Charge......................................................... 21
Monthly Deduction From Cash Value....................................... 21
Charge Against the Separate Account..................................... 23
Surrender Charge........................................................ 23
Guarantee of Certain Charges............................................ 23
Other Charges........................................................... 23
ILLUSTRATIONS OF DEATH BENEFITS, CASH VALUES, CASH SURRENDER VALUES AND
ACCUMULATED PREMIUMS.................................................... 24
POLICY RIGHTS............................................................ 31
Loan Privileges......................................................... 31
Surrender and Withdrawal Privileges..................................... 32
Exchange Privilege...................................................... 32
THE FIXED ACCOUNT........................................................ 33
General Description..................................................... 33
Fixed Account Benefits.................................................. 33
Fixed Account Cash Value................................................ 33
Transfers, Withdrawals, Surrenders and Policy Loans..................... 34
RIGHTS RESERVED BY METROPOLITAN LIFE..................................... 34
OTHER POLICY PROVISIONS.................................................. 34
SALES AND ADMINISTRATION OF THE POLICIES................................. 35
DISTRIBUTION OF THE POLICIES............................................. 36
FEDERAL TAX MATTERS...................................................... 36
Taxation of the Policy.................................................. 36
Taxation of Metropolitan Life........................................... 38
MANAGEMENT............................................................... 39
VOTING RIGHTS............................................................ 42
Right to Instruct Voting of Fund Shares................................. 42
Disregard of Voting Instructions........................................ 42
REPORTS.................................................................. 42
STATE REGULATION......................................................... 42
REGISTRATION STATEMENT................................................... 43
LEGAL MATTERS............................................................ 43
EXPERTS.................................................................. 43
FINANCIAL STATEMENTS..................................................... 43
APPENDIX TO PROSPECTUS................................................... 44
OPTIONAL INSURANCE BENEFITS.............................................. 45
</TABLE>
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING IN ANY JURISDICTION IN WHICH
SUCH OFFERING MAY NOT LAWFULLY BE MADE. METROPOLITAN LIFE DOES NOT AUTHORIZE
ANY INFORMATION OR REPRESENTATIONS REGARDING THE OFFERING DESCRIBED IN THIS
PROSPECTUS OTHER THAN AS CONTAINED IN THIS PROSPECTUS OR ANY ATTACHED
PROSPECTUS OR ANY SUPPLEMENT THERETO OR IN ANY SUPPLEMENTAL SALES MATERIAL
AUTHORIZED BY METROPOLITAN LIFE.
2
<PAGE>
DEFINITIONS
Age--The age in full years of the insured at issue of the Policy, plus the
number of full Policy years completed since issue. A full Policy year is
completed upon the commencement of the next succeeding Policy year. The age is
computed using the issue age.
Beneficiary--The beneficiary is the person or persons designated by the
owner of the Policy to receive the insurance proceeds upon the death of the
insured.
Cash Surrender Value--The cash value less any indebtedness and any
applicable surrender charge and, if the Policy is surrendered in the first
Policy year, less the Administration Charge for each full Policy month
remaining to the end of the first Policy year.
Cash Value--The sum of the Policy cash values in the Fixed Account, the
investment divisions of the Separate Account and the Policy Loan Account.
Date of Policy--The date set forth in the Policy that is used to determine
Policy years and Policy months from issue. Policy anniversaries are measured
from the Date of Policy.
Designated Office--The home office of Metropolitan Life at 1 Madison Avenue,
New York, New York 10010, to which all Policy owner communications are to be
sent. Metropolitan Life may, by written notice, name other locations within
the United States to serve as designated offices, in place of or in addition
to the home office.
Final Date--The policy anniversary on which the insured is Age 95. In states
where permitted, the Policy owner may elect to continue the Policy after the
Final Date.
Fixed Account--An account which is part of the General Account and to which
Metropolitan Life will allocate net premiums as directed by the owner of a
Policy and credit certain fixed rates of interest.
General Account--The assets of Metropolitan Life other than those allocated
to the Separate Account or any other legally-segregated separate account.
Guaranteed Minimum Death Benefit--A guarantee by Metropolitan Life that the
specified face amount plus any additional death benefits provided by rider to
the Policy will be paid regardless of the amount of cash value in the Policy,
subject to certain requirements. Generally, four durations of the Guaranteed
Minimum Death Benefit are available: (i) for the first five Policy years
("Five Year Guarantee"); (ii) to Age 65; (iii) to Age 75; or (iv) to Age 85
(see "Guaranteed Minimum Death Benefit").
Federal Guideline Annual Premium--The level annual amount of premium that
would be payable through the Final Date of a Policy for the specified face
amount of the Policy if premiums were fixed by Metropolitan Life as to both
timing and amount and were based on 1980 Commissioners Standard Ordinary
Mortality Tables, net investment earnings at an annual effective rate of 4%,
and fees and charges as set forth in the Policy and any Policy riders. The
Federal Guideline Annual Premium is based on the insured's age, sex and
smoking status, and is higher for older ages, for males and for smokers.
Increase Surrender Charge Measure--For the first year following the
increase, the lesser of: (A) the amount by which actual cumulative premiums
paid within twelve months following the date of the application for the
specified face amount increase exceeds the sum of (i) the Surrender Charge
Measure for the first Policy year plus (ii) the Increase Surrender Charge
Measure for the first year following any prior increases; and (B) the Maximum
Surrender Charge Premium at the time of the increase. On and after the second
year following the increase, the lesser of: (A) the amount by which actual
cumulative premiums paid within twenty-four months following the date of the
application for the specified face amount increase exceeds the sum of (i) the
Surrender Charge Measure for the second Policy year, plus (ii) the Increase
Surrender Charge Measure for the second year following any prior increases;
and (B) the Maximum Surrender Charge Premium for the second Policy year
following the increase.
Indebtedness--The total of any unpaid Policy loan and loan interest.
Insured--The person upon whose life the Policy is issued.
Investment Start Date--The date the first net premium is applied to the
Fixed Account. It is the later of (1) the Date of Policy and (2) the date the
first premium for a Policy is received at the Designated Office.
3
<PAGE>
Investment Division--A subdivision of the Separate Account. The assets in
each investment division are invested exclusively in the shares of a specified
portfolio.
Issue Age--The age of the insured as of the birthday prior to or coincident
with the date of the base policy.
Loan Value--The maximum amount that may be borrowed under the Policy. The
loan value equals the Policy's cash surrender value less two monthly
deductions, or, if greater, 75% (90% in Virginia and Maryland) of the cash
surrender value (or, in Texas, the Policy's cash surrender value less two
monthly deductions or 100% of the cash surrender value in the Fixed Account
and 75% of the cash surrender value in the Separate Account, if greater).
Maximum Surrender Charge Premium--An amount determined at issue (or for
specified face amount increases, at the time of the increase) which will not
exceed: (i) for the first Policy year, or for the first year after the
increase, 75% of the Federal Guideline Annual Premium for Death Benefit Option
A and all riders at issue, or at the time of the increase, respectively; and
(ii) for the second Policy year and thereafter, or the second and later years
after the increase, 100% of the Federal Guideline Annual Premium for Death
Benefit Option A and all riders at issue or at the time of the increase.
Minimum Initial Premium--The lowest premium that must be paid by the Policy
owner in the first Policy year. (See "Premiums").
Minimum Initial Specified Face Amount--The minimum specified face amount of
insurance for which a Policy may be issued. Currently, the amount is $100,000
for insureds in the preferred rate class, $50,000 for most other insureds,
$25,000 for certain insureds over age 59 and $250,000 for most Policies
distributed through brokers (see "Distribution of the Policies").
Monthly Anniversary--The same date in each month as the Date of Policy. For
purposes of the Separate Account, whenever the monthly anniversary date falls
on a date other than a Valuation Date, the next Valuation Date will be deemed
to be the monthly anniversary.
Monthly Deduction--Charges deducted monthly from the cash value of a Policy
and which include the monthly cost of term insurance, the mortality and
expense risk charges, the monthly cost of any benefits provided by riders, and
the monthly administration charges.
Policy--The flexible premium multifunded life insurance policy offered by
Metropolitan Life and described in this Prospectus.
Policy Anniversary 65--The policy anniversary on which the Policy owner is
age 65.
Policy Loan Account--An account within the General Account to which cash
value from the Separate Account and/or the Fixed Account in an amount equal to
a Policy loan requested by a Policy owner is transferred.
Policy Month--The month beginning on the monthly anniversary.
Policy owner ("Owner")--The person so designated in the application or as
subsequently changed.
Portfolio--A portfolio represents a different class (or series) of stock of
the Metropolitan Series Fund, Inc., a mutual fund in which the Separate
Account assets are invested.
Separate Account--Metropolitan Life Separate Account UL, a separate
investment account of Metropolitan Life through which premiums paid under the
Policy are invested to the extent allocated to the Separate Account by the
Policy owner.
Specified Face Amount--The amount of insurance specified on the face of the
Policy.
Surrender Charge Measure--For the first Policy year, the lesser of: (A) the
actual cumulative premiums paid and (B) the maximum surrender charge premium.
For the second Policy year and later Policy years, the lesser of (A) the
actual cumulative premiums paid within the first two Policy years and (B) the
maximum surrender charge premium.
Valuation Date--Each day on which the New York Stock Exchange is open for
trading or, on days other than when the New York Stock Exchange is open, on
which it is determined that there is a sufficient degree of trading in the
Fund's portfolio securities that the current net asset value of its redeemable
securities might be materially affected. Valuations for any date other than a
Valuation Date will be determined as of the next Valuation Date.
4
<PAGE>
Valuation Period--The period between two successive Valuation Dates,
commencing at the close of regular trading on the New York Stock Exchange on
each Valuation Date and ending at the close of regular trading on the New York
Stock Exchange, on the next succeeding Valuation Date.
This Prospectus describes only those aspects of the Policy that relate to
the Separate Account since only interests in the Separate Account are being
offered by this Prospectus. Aspects of the Fixed Account are briefly
summarized in order to give a better understanding of how the Policy functions
(see "The Fixed Account").
5
<PAGE>
SUMMARY
................................................................................
PURPOSE OF SUMMARY
This summary was written to give you an overview of the Policy and is
qualified by the more detailed information provided in the prospectus and the
Policy, when issued. You may find it helpful to review the definitions of terms
described preceding this summary before reading the prospectus in full.
ABOUT METROPOLITAN LIFE
Metropolitan Life, the issuer of the Policies, is a mutual life insurance
company incorporated under the laws of the State of New York in 1866. Its home
office is located at 1 Madison Avenue, New York, New York 10010. MetLife is
authorized to transact business in all states of the United States, the
District of Columbia, Puerto Rico, and all Provinces of Canada. Metropolitan
Life, serving millions of people, is one of the largest financial services
companies in the world with many of the largest United States corporations for
its clients. On December 31, 1997, Metropolitan Life had total life insurance
in force of approximately $1.7 trillion and total assets under management of
approximately $330.3 billion.
POLICY IN BRIEF
The Policy is issued by Metropolitan Life. It is designed to meet the
changing life insurance needs of a Policy owner. The Policy provides for a
choice of death benefit options, flexible premium payments, and cash value
accumulation through the Policy owner's selected options.
The owner of the Policy may, within limits:
. Select from among three death benefit options
. Increase or decrease the specified face amount
. Choose the amount and frequency of premium payments
. Direct net premium payments to any of eleven funding options
. Transfer amounts among the funding options.
. Maintain a Guaranteed Minimum Death Benefit.
PREMIUMS
The Minimum Initial Premium must be paid in the first Policy year or the Pol-
icy will terminate after the grace period. The owner will also choose a volun-
tary planned periodic premium payment schedule of at least $200 annually after
the first Policy year. At any time, subject to certain limitations, additional
premium payments of at least $250 may be made. In addition, in order to main-
tain a guaranteed minimum death benefit, a minimum amount of premium is re-
quired which varies based on several factors.
If no guaranteed minimum death benefit is effective, the payment of premiums
at any specified level does not guarantee that the Policy will remain in force.
In the absence of the guaranteed minimum death benefit, for a Policy to remain
in force, the cash surrender value must be sufficient to cover one monthly
deduction. (See "Payment and Allocation of Premiums," "Policy Benefits--Death
Benefits," and "Policy Termination and Reinstatement.")
THE GUARANTEED MINIMUM DEATH BENEFIT
The Policy offers a guaranteed minimum death benefit that guarantees payment
upon death of the specified face amount of insurance plus any additional death
benefits provided by rider to the Policy; provided that certain premium
requirements are satisfied. Generally, there are four durations available for
the guaranteed minimum death benefit from which a Policy owner may choose: (i)
for the first five Policy years; (ii) to Age 65; (iii) to Age 75; or (iv) to
Age 85. The Policy owner elects the duration of the guaranteed minimum death
benefit when the Policy is issued, and may later reduce its duration (see
"Guaranteed Minimum Death Benefit").
6
<PAGE>
CASH VALUE
The Policy's total cash value includes the Policy value in the Separate
Account, the Fixed Account, and the Policy Loan Account. This value reflects
the investment experience of the Separate Account investment divisions
selected, the interest credited to any allocations to the Fixed Account, loan
activity, partial withdrawals, and Policy charges. There is no guaranteed
minimum cash value if amounts are allocated to the Separate Account. (See
"Policy Benefits," "Policy Rights" and "The Fixed Account.")
BENEFITS AND RIDERS
A Policy owner has the flexibility to add optional insurance benefits by
rider. These riders include spouse term insurance, children's term insurance,
accidental death benefit, disability waiver of monthly deductions benefit,
disability waiver of premium benefit, and accelerated death benefit. (See
"Policy Benefits.")
DEATH BENEFIT OPTIONS
The Policy provides for three death benefit options in most states:
.Option A: the death benefit is the specified face amount of the Policy.
.Option B: the death benefit is equal to the specified face amount of the
Policy plus the cash value on the date of death.
.Option C: Where the insured is age 60 or less, the death benefit is equal
to the specified face amount of the Policy plus the cash value
on the date of death until the policy anniversary 65; at policy
anniversary 65, the death benefit is recalculated to equal the
specified face amount plus the cash value on policy anniversary
65; the death benefit does not vary after this recalculation.
After the second Policy year, the Policy owner may change the death benefit
option once in any 12 month period or increase or decrease the specified face
amount once in any 24 month period, subject to certain conditions and
limitations. Such changes can have tax consequences and affect the charges and
guarantees associated with the Policy. (See "Policy Benefits.")
THE FIXED ACCOUNT
Fixed Account assets are held in the General Account of Metropolitan Life.
Net premiums allocated to the Fixed Account are credited with an effective
annual interest rate of at least 3% per year. (See "The Fixed Account.")
THE SEPARATE ACCOUNT AND THE METROPOLITAN SERIES FUND
Separate Account UL is a separate investment account of Metropolitan Life. It
currently has ten investment divisions available to Policy owners. The assets
of each division are invested in the corresponding portfolio of the
Metropolitan Series Fund, Inc. Each portfolio of the Fund has a different
investment objective. (See "Separate Account and Metropolitan Series Fund," and
the prospectus for the Fund, which is attached at the end of this prospectus.)
THE FUNDING OPTIONS
The available investment divisions of the Separate Account are the State
Street Research Growth, State Street Research Income, State Street Research
Diversified, State Street Research Aggressive Growth, MetLife Stock Index,
State Street Research International Stock, Loomis Sayles High Yield Bond, T.
Rowe Price Small Cap Growth, Janus Mid Cap and Scudder Global Equity divisions.
Consult a sales representative registered with Metropolitan Life for more
information. The Policy owner may allocate the net premiums paid to one or more
of the investment divisions of the Separate Account and/or to the Fixed
Account. Net premiums are equal to the premium paid less premium expense
charges. Unlike the Fixed Account, the investment performance of a Separate
Account investment division is not guaranteed by Metropolitan Life. The Policy
owner should consider his or her risk tolerance before selecting the funding
options for premium payments. A Policy owner may change the
7
<PAGE>
allocation of future net premiums at any time. (See "Separate Account and
Metropolitan Series Fund," "Payment and Allocation of Premiums," and "The Fixed
Account.")
AUTOMATED INVESTMENT STRATEGIES
There are currently four automated investment strategies available.
. Equity Generator SM--If monthly interest earned is at least $20, the in-
terest is transferred from the Fixed Account to the Policy owner's se-
lected option of either the MetLife Stock Index Division or the State
Street Research Aggressive Growth Division.
. Equalizer SM--At the end of a specified period as determined by Metropol-
itan Life (e.g. monthly, quarterly) a transfer is made between the Fixed
Account and the Policy owner's selected option of either the MetLife
Stock Index Division or the State Street Research Aggressive Growth Divi-
sion to make them equal in value.
. Allocator SM--The Policy owner designates a monthly transfer from the
Fixed Account to the any investment division.
. Rebalancer SM--Cash value is redistributed quarterly so that it is allo-
cated among the Fixed Account and the investment divisions of the Sepa-
rate Account in the same proportion in which net premiums are allocated.
FUND TRANSFERS AND CHARGES
A Policy owner may transfer amounts among the investment divisions of the
Separate Account and the Fixed Account. Currently there are no charges assessed
for transfers. Metropolitan Life reserves the right to charge up to $25 for
each transfer and to limit the timing or amount of transfers to or from the
Fixed Account; however, no charges will be assessed under any of the automated
investment strategies. (See "Payment and Allocation of Premiums," and "Charges
and Deductions.")
PREMIUM EXPENSE CHARGES
A 5.50% charge is deducted from each premium payment. The charge includes:
. 2.25% for front-end sales charges
. 2% for state premium tax charges
. 1.25% to recover a portion of Metropolitan Life's federal income taxes.
(See "Charges and Deductions.")
MONTHLY DEDUCTION FROM CASH VALUE
The Policy's cash value is reduced each month by the sum of: 1) cost of term
insurance charge, 2) a charge for additional riders, 3) a charge for adminis-
tration and 4) a charge for mortality and expense risks. (See "Charges and De-
ductions.")
The charge for the cost of term insurance compensates Metropolitan Life for
the insurance coverage provided under the Policy. The charge varies based on
several factors including age, sex (except in Montana), rating class and
specified face amount then in effect.
The charge for administration is $35.00 per month for insureds who are Age 41
and over. The charge is lower at younger ages. After the first Policy year, the
monthly administration charge is $10.00 unless certain premium requirements
have been met, in which case the monthly administration charge will be lower,
based on specified face amount. If the Policy is surrendered during the first
Policy year, any remaining amount of the full year's charge for administration
will be deducted upon surrender.
The charge for mortality and expense risks assumed by Metropolitan Life is
equivalent to a monthly rate of .075% of the cash value in the separate account
on each monthly anniversary. This charge may be reduced in the years following
Policy year 10.
INCREASE IN SPECIFIED FACE AMOUNT CHARGE
Any increase in the specified face amount requested by a Policy owner will
result in an underwriting expense charge of $5 per month for the twelve months
following the month of increase. (See "Policy Benefits.")
8
<PAGE>
SURRENDER AND SURRENDER CHARGES
At any time the Policy owner may request in writing the Policy's cash surren-
der value. A surrender charge is imposed during the first 15 Policy years and
during the first 15 years after an increase in the specified face amount. (See
"Charges and Deductions" and "Policy Rights.") The maximum surrender charges
are set forth in the Policy. Because of the surrender charge, it is unlikely
that the Policy will have any cash surrender value for at least the first Pol-
icy year unless the Policy owner pays significantly more than the Minimum Ini-
tial Premium.
PARTIAL WITHDRAWALS
Partial withdrawals of at least $500 may be made from the Policy's cash value
after the second Policy year. A pro rata surrender charge will be applied to
withdrawals. However, up to 10% of a Policy's cash surrender value may be
withdrawn in each Policy year free of surrender charge. The request must be
made in writing. Partial withdrawals under death benefit Option A, or Option C
on or after policy anniversary 65, will reduce the specified face amount of the
Policy. (See "Policy Rights.")
LOANS
The Policy owner may obtain a Policy loan whenever the Policy has a loan val-
ue. The loan amount is placed into the Policy Loan Account as collateral, and
is credited a guaranteed interest rate of 4% per year. The rate charged on the
loan is currently 6% per year. Loan interest is payable at the end of each Pol-
icy year. The interest rate charged for a loan may be reduced to 4.6% after the
tenth Policy year and will never be greater than 6% per year.
FUND INVESTMENT MANAGEMENT FEES AND DIRECT EXPENSES
For providing investment management services to the Fund, Metropolitan Life
receives a fee from the Fund for providing investment management services to
each Portfolio. The following chart shows the fee and other Fund expenses for
each Portfolio.
METROPOLITAN SERIES FUND ANNUAL EXPENSES (AS A PERCENTAGE OF AVERAGE NET
ASSETS)
<TABLE>
<CAPTION>
OTHER
EXPENSES
MANAGEMENT AFTER EXPENSE
FEES REIMBURSEMENT TOTAL
---------- ------------- -----
<S> <C> <C> <C>
MetLife Stock Index Portfolio.................
State Street Research Income Portfolio(b).....
State Street Research Diversified
Portfolio(b).................................
State Street Research Growth Portfolio(b).....
State Street Research Aggressive Growth
Portfolio(b).................................
T. Rowe Price Small Cap Growth
Portfolio(a)(b)..............................
Scudder Global Equity Portfolio(a)(b).........
Loomis Sayles High Yield Bond Portfolio(a)....
Janus Mid Cap Portfolio(a)(b).................
State Street Research International Stock
Portfolio....................................
</TABLE>
--------
(a) Metropolitan Life agreed to bear all expenses (other than management
fees, brokerage commissions, taxes, interest and any extraordinary or
non-recurring expenses) in excess of .20% of the net assets for each
of the Loomis Sayles High Yield Bond, T. Rowe Price Small Cap Growth,
Janus Mid Cap and Scudder Global Equity Portfolios until a
Portfolio's total net assets are at least $100 million, or March 2,
1999, whichever is earlier. Expenses for these Portfolios, absent the
expense reimbursement, would have been %, %, % and %,
respectively. Metropolitan Life ceased subsidizing such expenses for
the Janus Mid Cap Portfolio as of December 31, 1997 and the T. Rowe
Price Portfolio as of January 23, 1998.
(b) The marginal fee rate for the State Street Research Income Portfolio,
State Street Research Diversified Portfolio, State Street Research
Growth Portfolio, State Street Research Aggressive Growth Portfolio,
T. Rowe Price Small Cap Growth Portfolio, Janus Mid Cap Portfolio,
and Scudder Global Equity Portfolio will decrease when the dollar
amount in each such Portfolio reaches certain threshold amounts.
For a full description of the Fund, see the prospectus for the Fund, which is
attached at the end of this Prospectus, and the Fund's Statement of Additional
Information referred to therein.
9
<PAGE>
FREE LOOK PERIOD
The Policy owner may return the Policy during the free look period. This pe-
riod is the later of 10 days after receipt of the Policy (except where state
law requires a longer period) or 45 days after Part A of the application has
been completed. If the Policy is returned, Metropolitan Life will send the Pol-
icy owner a complete refund of any premiums paid within 7 days. Net premium
payments allocated to the Separate Account will be invested in the Fixed Ac-
count for 20 days after the Investment Start Date. In addition, no cash value
transfers or participation in automated investment strategies will be permitted
until 20 days after the Investment Start Date.
TAX TREATMENT OF CASH VALUE
Cash value in the Policy is not taxed until it is withdrawn from the Policy.
In general, a Policy owner will be taxed on the amount of cash value withdrawn
that is in excess of the premiums paid less prior nontaxable withdrawals at the
time of withdrawal, surrender, or Policy Final Date. This excess is treated as
ordinary income. Withdrawals and loans from contracts referred to as modified
endowment contracts are taxed on an income first basis to the extent of gain in
the Policy. A 10% additional tax also applies in certain circumstances. If a
Policy is part of a collateral assignment equity split-dollar arrangement with
an employer, any increase in cash value may be taxable annually. An individual
should consult with and rely on the advice of a tax advisor with respect to any
type of split-dollar arrangement involving a Policy. (See "Federal Tax Mat-
ters.")
TAX TREATMENT OF THE DEATH BENEFIT
The beneficiary generally will not be taxed on the death benefit proceeds of
the Policy. The death benefit under the Policy may be subject to Federal estate
tax. (See "Federal Tax Matters.")
COMMUNICATIONS
Premium payments and other communications should be sent to the Designated
Office for the Policy. Metropolitan Life may establish different Designated Of-
fices for various Policy transactions. The Policy owner should use the forms
that Metropolitan Life has prepared for these purposes. The forms may be ob-
tained from an account representative or the Designated Office.
A premium payment or other communication is considered received on the date
that it is actually received in the Designated Office (the "Date of Receipt")
with two exceptions: 1) if received on a day that is not a Valuation Date or 2)
if received by other than U.S. mail after the close of regular trading on the
New York Stock Exchange. The Date of Receipt will then be the next Valuation
Date. Absent extraordinary circumstances, regular trading on the New York Stock
Exchange ends at 4:00 p.m. New York City time.
10
<PAGE>
...............................................................
SEPARATE ACCOUNT AND METROPOLITAN SERIES FUND
................................................................................
THE SEPARATE ACCOUNT
The Separate Account, which is a separate investment account of Metropolitan
Life, was established by Metropolitan Life pursuant to the New York Insurance
Law on December 13, 1988. The Separate Account also receives premium payments
in connection with other forms of the flexible premium multifunded life insur-
ance policies issued by Metropolitan Life. The assets allocated to the Separate
Account are the property of Metropolitan Life, and Metropolitan Life is not a
trustee by reason of the Separate Account. Metropolitan Life may accumulate in
the Separate Account mortality and expense risk charges, mortality gains and
investment gains on those assets (which represent such charges) in the Separate
Account and other amounts in excess of Metropolitan Life's liabilities and re-
serves with respect to the Separate Account.
The Separate Account meets the definition of "separate account" under the
federal securities laws. All income, gains and losses, whether or not realized,
from assets allocated to the Separate Account are credited to or charged
against the Separate Account without regard to other income, gains or losses of
Metropolitan Life. Each Policy provides that such portion of the assets in the
Separate Account as equals the liabilities (and reserves) of Metropolitan Life
with respect to the Separate Account shall not be chargeable with liabilities
arising out of any other business of Metropolitan Life. Metropolitan Life may
from time to time transfer to its General Account any assets in the Separate
Account in excess of such reserves and liabilities. The liabilities are Metro-
politan Life's total commitments under the Policies; the reserves are the as-
sets allocated to pay these commitments.
Although the Separate Account is an integral part of Metropolitan Life, the
Separate Account is registered with the Securities and Exchange Commission as a
unit investment trust under the Investment Company Act of 1940 ("1940 Act").
Registration does not involve supervision of management or investment practices
or policies of the Separate Account or of Metropolitan Life by the Commission.
There are currently ten investment divisions available to the Policy in the
Separate Account. The assets in each investment division are invested in a sep-
arate class (or series) of stock issued by the Fund. Each class of stock repre-
sents a separate portfolio within the Fund. New investment divisions may be
added as new portfolios are added to the Fund and made available to Policy own-
ers. In addition, investment divisions may be eliminated from the Separate Ac-
count. The owner of a Policy may designate how the net premiums under the Pol-
icy are to be allocated among the then currently available investment divi-
sions.
METROPOLITAN SERIES FUND
The Fund is a "series" type of mutual fund which is registered with the Secu-
rities and Exchange Commission as a diversified open-end management investment
company under the 1940 Act. The Fund has served as the investment medium for
the Separate Account since the Separate Account commenced operations. A brief
summary of the investment objectives of each Fund portfolio presently available
to Policy owners is set forth below.
State Street Research Growth Portfolio. The investment objective of this
portfolio is to achieve long-term growth of capital and income, and moderate
current income, by investing primarily in common stocks that are believed to be
of good quality or to have good growth potential or which are considered to be
undervalued based on historical investment standards.
State Street Research Income Portfolio. The investment objective of this
portfolio is to achieve the highest possible total return, by combining current
income with capital gains, consistent with prudent investment risk and the
preservation of capital, by investing primarily in fixed-income, high-quality
debt securities.
State Street Research Diversified Portfolio. The investment objective of this
portfolio is to achieve a high total return while attempting to limit invest-
ment risk and preserve capital by investing in equity securities, fixed-income
debt securities, or short-term money market instruments, or any combination
thereof, at the discretion of State Street Research.
State Street Research Aggressive Growth Portfolio. The investment objective
of this portfolio is to achieve maximum capital appreciation by investing pri-
marily in common stocks (and equity and debt securities convertible into or
carrying the right to acquire common stocks) of emerging growth companies, un-
dervalued securities or special situations.
State Street Research International Stock Portfolio. The investment objective
of this portfolio is to achieve long-term growth of capital by investing pri-
marily in common stocks and equity-related securities of non-United States com-
panies.
MetLife Stock Index Portfolio. The investment objective of this portfolio is
to equal the performance of the Standard & Poor's 500 Composite Stock Price In-
dex (adjusted to assume reinvestment of dividends) by investing in the common
stock of companies which are included in the index.
Loomis Sayles High Yield Bond Portfolio: The investment objective of this
portfolio is to achieve high total investment return through a combination of
current income and capital appreciation. The Portfolio will normally invest at
least 65% of its assets in fixed income securities of below investment grade
quality.
11
<PAGE>
...............................................................
Janus Mid Cap Portfolio: The investment objective of this non-diversified
portfolio is to provide long-term growth of capital. It pursues this objective
by investing primarily in securities issued by medium sized companies.
T. Rowe Price Small Cap Growth Portfolio: The investment objective of this
portfolio is to achieve long-term growth by investing in small capitalization
companies.
Scudder Global Equity Portfolio: The investment objective of this portfolio
is to achieve long-term growth of capital through a diversified portfolio of
marketable securities, primarily equity securities, including common stocks,
preferred stocks and debt securities convertible into common stocks. The Port-
folio invests on a worldwide basis in equity securities of companies which are
incorporated in the U.S. or in foreign countries. It also may invest in the
debt securities of U.S. and foreign issuers. Income is an incidental consider-
ation.
Metropolitan Life purchases and redeems Fund shares for the Separate Account
at their net asset value without the imposition of any sales or redemption
charges. Such shares represent an interest in one of the portfolios of the
Fund which correspond to the investment divisions of the Separate Account. Any
dividend or capital gain distributions received from the Fund are likewise re-
invested in Fund shares at net asset value as of the dates paid. The distribu-
tions have the effect of reducing the value of each share of the Fund and in-
creasing the number of Fund shares outstanding. However, the total cash value
in the Separate Account does not change as a result of such distributions.
On each Valuation Date, shares of each portfolio are purchased or redeemed
by Metropolitan Life for the Separate Account, based on, among other things,
the amounts of net premiums allocated to the Separate Account, dividends and
distributions reinvested, transfers to and among investment divisions, Policy
loans, loan repayments and benefit payments to be effected pursuant to the
terms of the Policies as of that date. Such purchases and redemptions for the
Separate Account are effected at the net asset value per share for each port-
folio determined as of the close of the end of that same Valuation Date.
A full description of the Fund, its investment policies and restrictions,
its charges and other aspects of its operation is contained in the prospectus
for the Fund, which is attached at the end of this Prospectus, and in the
Statement of Additional Information referred to therein. See "The Fund and its
Purpose," in the prospectus for the Fund for a discussion of the different
separate accounts of Metropolitan Life and its affiliates that invest in the
Fund and the risks related thereto.
POLICY BENEFITS
...............................................................................
The discussion below assumes that no riders under the Policy are in effect.
See the Appendix to Prospectus, for a discussion of how certain riders can af-
fect benefits under the Policy.
DEATH BENEFITS
As long as the Policy remains in force (see "Policy Termination and Rein-
statement--Termination"), Metropolitan Life will, upon due proof of the
insured's death, pay the insurance proceeds of the Policy to the named benefi-
ciary. The proceeds may be received by the beneficiary in a single sum or un-
der one or more of the optional income plans set forth in the Policy (see "Op-
tional Income Plans"). The amount of insurance proceeds is determined as of
the end of the Valuation Period that includes the insured's date of death.
The insurance proceeds are: The death benefit provided under Option A, Op-
tion B or Option C, whichever is elected and in effect on the date of death;
plus (b) any additional insurance on the insured's life that is provided by
rider; minus (c) any outstanding indebtedness and any due and unpaid charges
accruing during the grace period.
DEATH BENEFIT OPTIONS
At least two death benefit options are available as described below: Option
A and Option B. Death Benefit Option C is also available where the insured is
age 60 or less at issue. The Policy owner designates the desired option in the
application and can change the option by written request after the second Pol-
icy year (see "Change in Death Benefit Option").
Option A--The death benefit is equal to the specified face amount of insur-
ance.
Option B--The death benefit is equal to the specified face amount of insur-
ance plus the cash value.
Option C--The death benefit is equal to the specified face amount of insur-
ance plus the cash value if the insured dies prior to policy anniversary 65.
At policy anniversary 65, the specified face amount of insurance is recalcu-
lated to equal the specified face amount of insurance plus the cash value as
of the end of the prior day. Thereafter, the specified face amount of insur-
ance will be paid upon death.
Alternative Death Benefit--Under Option A, Option B or Option C, an alterna-
tive death benefit automatically applies if it is greater than the regular
death benefit option chosen. The alternative death benefit under each option
is a percentage of the cash value as set forth in the following table. The al-
ternative death benefit is determined in accordance with federal income tax
laws, to ensure that the Policy qualifies as a life insurance contract and
that the insurance proceeds will be excluded from the gross income of the ben-
eficiary.
12
<PAGE>
...............................................................
<TABLE>
<CAPTION>
AGE
OF INSURED AT
BEGINNING OF POLICY PERCENTAGE OF
YEAR CASH VALUE
------------------- -------------
<S> <C>
40 and less: ................................................... 250%
45: ............................................................ 215%
50: ............................................................ 185%
55: ............................................................ 150%
60: ............................................................ 130%
65: ............................................................ 120%
70: ............................................................ 115%
75: ............................................................ 105%
80: ............................................................ 105%
85: ............................................................ 105%
90: ............................................................ 105%
95: ............................................................ 100%
</TABLE>
For the ages not listed, the percentage decreases by a ratable portion for each
full year.
In no event will the death benefit be lower than the minimum amount required
to maintain the Policy as life insurance under federal income tax law and ap-
plicable Internal Revenue Service rules.
Option A, Option B, and Option C all provide insurance protection, as well as
possible build-up of cash value. Under Option A, and under Option C on or after
policy anniversary 65, the insurance coverage remains level unless the alterna-
tive death benefit applies. Under Option B, and under Option C prior to policy
anniversary 65, the insurance protection varies as the cash value changes.
For a given specified face amount, the amount of the death benefit may be
greater under Option B, and under Option C prior to policy anniversary 65, than
under Option A, or under Option C on or after policy anniversary 65. This is
because the cash value is added to the specified face amount and included in
the death benefit under the former situations but not under the latter situa-
tions. By the same token, the cost of term insurance included in the monthly
deduction (see "Charges and Deductions--Cost of Term Insurance") will be great-
er, and thus the accumulation of cash value will be lower under Option B, and
under Option C prior to policy anniversary 65, than under Option A assuming the
same specified face amount and the same actual premiums paid. After policy an-
niversary 65, the cost of term insurance will be greater for Option B than for
Option C and greater for Option C than for Option A, assuming the same speci-
fied face amount at issue and the same premiums paid.
Under Option C the death benefit is designed to increase during the Policy
owner's earning years, because the need for life insurance is presumed to in-
crease with increasing income. On policy anniversary 65, which is the assumed
retirement age, the specified face amount is adjusted to equal the then current
level of death ben-efit, and no further increases in death benefit are made,
since presumably such increases are no longer required.
Guaranteed Minimum Death Benefit. Generally, the Policy offers a guaranteed
minimum death benefit that guarantees the specified face amount of insurance
plus any additional death benefits provided by rider to the Policy, if certain
premium requirements are satisfied. Generally, there are four durations of
guaranteed minimum death benefit from which a Policy owner may choose: (i) for
the first five Policy years; (ii) to Age 65 (available only if the insured was
Age 60 or less on the date the Policy was issued); (iii) to Age 75 (available
only if the insured was Age 70 or less on the date the Policy was issued); or
(iv) to Age 85 (available only if the insured was Age 80 or less on the date
the Policy was issued). The Policy owner must elect the duration of the
guaranteed minimum death benefit on or before the Policy issue date. In
addition, a Policy owner may later reduce the duration of the guaranteed
minimum death benefit by reducing the premiums paid to an amount that will only
support the shorter duration. If at the end of the elected guaranteed minimum
death benefit duration, the Policy owner's actual cumulative premiums that have
been paid by each monthly anniversary would entitle the owner to receive a
longer duration of guaranteed minimum death benefit, the duration will be
increased to the appropriate duration. The Policy owner will then need to pay
the necessary premium to maintain the guaranteed minimum death benefit for the
longer duration.
The guaranteed minimum death benefit and/or certain of its durations may not
be available to all rating classes; however, Metropolitan Life will not
discriminate unfairly in offering the guaranteed minimum death benefit to
Policy owners.
There is no additional charge for the guaranteed minimum death benefit;
however, there are minimum premium amounts required to keep the guarantee in
effect which vary based on several factors (see "Premiums"). The Policy is
tested on each monthly anniversary in order to verify that the minimum required
premium amounts have been paid to keep the applicable duration of guaranteed
minimum death benefit in effect. If the premium requirements for a particular
duration of the guaranteed minimum death benefit have not been maintained on a
Policy that had such duration, but the premium requirements for a shorter
duration of the guarantee that is available under such Policy have been met, a
notice will be sent to the Policy owner stating that the duration of the
guarantee will be reduced to the longest guarantee that is supported by the
premiums paid, unless sufficient premiums are paid within 61 days from the
monthly anniversary that the premium requirements to maintain the guaranteed
minimum death benefit have not been met. Similarly, if there is no shorter
duration that would still be available to the Policy in question, a notice will
be sent to the Policy owner
13
<PAGE>
...............................................................
stating that the guaranteed minimum death benefit under
the Policy will terminate, unless sufficient premiums are paid within 61 days
from the monthly anniversary that the premium requirements to maintain the
guaranteed minimum death benefit have not been met. ONCE A GIVEN DURATION OF
THE GUARANTEED MINIMUM DEATH BENEFIT HAS BEEN TERMINATED, IT MAY NOT BE
REACTIVATED.
Change in Specified Face Amount. Subject to certain limitations, a Policy
owner, after the second Policy year and before the insured reaches Age 80, may
increase or decrease the specified face amount of a Policy once in any 24
month period (see "Decreases" and "Increases," below). Any increase or de-
crease in the specified face amount requested by the Policy owner will become
effective on the monthly anniversary on or next following the Date of Receipt
of the request, or, if evidence of insurability is required, the date of ap-
proval of the request.
Decreases. The specified face amount remaining in force after any requested
decrease may not be less than the Minimum Initial Specified Face Amount during
the first five Policy years nor less than one-half the Minimum Initial Speci-
fied Face Amount thereafter. However, no decrease in specified face amount
will be permitted that would reduce the specified face amount below $25,000.
Any decrease in the specified face amount that is permitted may result in a
loss of the guaranteed minimum death benefit as well as a taxable distribution
determined by Internal Revenue Code rules (see "Premiums--Premium Limita-
tions"). For purposes of determining the cost of term insurance charge and the
amount of subsequent premium requirements to maintain a guaranteed minimum
death benefit, a decrease in the specified face amount will reduce the speci-
fied face amount in the following order: (a) the specified face amount pro-
vided by the most recent increase; (b) the next most recent increases succes-
sively; and (c) the initial specified face amount.
Increases. Any change in the specified face amount requested by the Policy
owner which results in an increase in the death benefit may be made only if
the cash surrender value after the change is large enough to cover at least
two monthly deductions based on the most recent cost of term insurance charge
deducted. The minimum amount of an increase is $5,000. Any such change will
require that additional evidence of insurability be submitted to Metropolitan
Life and will be subject to an underwriting charge of $5 per month for the
twelve months following the month of increase. Metropolitan Life will deduct
this charge from the existing cash value in the same manner in which the
monthly deductions are taken (see "Monthly Deduction From Cash Value").
Effect of Changes in Specified Face Amount on Charges and Guaranteed Minimum
Death Benefit. A change in the specified face amount generally will affect
the term insurance amount used to compute a Policy owner's cost of term insur-
ance charge (see "Charges and Deductions--Cost of Term Insurance," "Cost of
Term Insurance Rate," and "Rate Class"). This in turn can affect the level of
subsequent cash values and death benefits. A change in the specified face
amount may also affect the Policy's status as a modified endowment contract
for tax purposes (see "Federal Tax Matters"). An increase in the specified
face amount results in additional surrender charges. A decrease in the speci-
fied face amount of insurance will generally be subject to a surrender charge
(see "Charges and Deductions--Surrender Charge").
Changes in the specified face amount of insurance will impact the premium
requirements for maintaining a guaranteed minimum death benefit. If a Policy
owner increases or decreases the specified face amount of a Policy that main-
tains a guaranteed minimum death benefit, the future premiums necessary to
maintain the guarantee on the Policy may increase or decrease, respectively
(see "Premiums").
Change in Death Benefit Option. Generally, after the second Policy year, the
death benefit option in effect may be changed once in any 12 month period
while the insured is alive to any other available death benefit option by
sending a written request for change to the Designated Office. A change from
Option A or Option B to Option C will only be permitted for Policy owners who
have Policies under which Option C is available. In addition, a change to Op-
tion C will not be permitted after the policy anniversary on which the insured
is age 60. A change in death benefit option will not be permitted unless the
cash surrender value of a Policy after the change is effected would be suffi-
cient to pay at least two monthly deductions. Changing death benefit options
will not require evidence of insurability and the effective date of any such
change will be the monthly anniversary on or following the Date of Receipt of
the request.
If the death benefit option is changed from Option B, or Option C prior to
policy anniversary 65 to Option A, the specified face amount will be increased
to equal the death benefit which would have been payable under Option B or Op-
tion C on the effective date of the change. The death benefit will not be al-
tered at the time of the change. However, the change in death benefit option
will affect the determination of the death benefit from that point on since
the cash value will no longer be added to the specified face amount in deter-
mining the death benefit. From that point on, the death benefit will equal the
new specified face amount (or, if higher, the alternative death benefit). This
will mean that the cost of term insurance may be higher or lower than it oth-
erwise would
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have been since any increases or decreases in cash values will, respectively,
reduce or increase the term insurance amount under Option A (see "Charges and
Deductions--Cost of Term Insurance").
If the death benefit option is changed from Option A, or Option C on and af-
ter policy anniversary 65, to Option B, the specified face amount will be de-
creased to equal the death benefit less the cash value on the effective date
of the change. Similarly, if the death benefit is changed from Option A to Op-
tion C before policy anniversary 65, the specified face amount will be de-
creased to equal the death benefit less the cash value on the effective date
of the change. Neither of these changes may be made if it would result in a
specified face amount which is less than the Minimum Initial Specified Face
Amount during the first five Policy years and one-half the Minimum Initial
Specified Face Amount thereafter. In no case will a change be made if it would
result in a specified face amount of less than $25,000. As with a change from
Option B, or Option C prior to policy anniversary 65, to Option A, a change
from Option A, or Option C on and after policy anniversary 65, to Option B
will not alter the death benefit at the time of the change, but will affect
the determination of the death benefit from that point on. Since, from that
point on, the cash value will be added to the new specified face amount, the
death benefit will vary with the cash value. This is also the case with a
change from Option A to Option C before policy anniversary 65. Moreover, under
Option B, or Option C prior to policy anniversary 65, the term insurance
amount will not vary unless the alternative death benefit is in effect. There-
fore, the cost of term insurance may be higher or lower than it otherwise
would have been without the change in death benefit option (see "Charges and
Deductions--Cost of Term Insurance"). A change in death benefit option will
not be permitted if it results in total premiums paid exceeding the then cur-
rent maximum premium limitations determined by Internal Revenue Service Rules
(see "Premiums--Premium Limitations").
If the death benefit option is changed from Option B to Option C prior to
policy anniversary 65, from Option C to Option A on or after policy anniver-
sary 65, or from Option C to Option B prior to policy anniversary 65, no
change in specified face amount will be made.
Under Option A, Option B and Option C, cost of term insurance rates gener-
ally increase as the insured's age increases. Nevertheless, assuming a posi-
tive cumu lative net investment return with respect to any amounts in the Sep-
arate Account, changing the death benefit option from Option B, or Option C
prior to policy anniversary 65, to Option A will reduce the term insurance
amount and therefore the cost of term insurance charge for all subsequent
monthly deductions compared to what such charge would have been if no such
change were made.
A change in death benefit option that results in an increase or a decrease
in the specified face amount of insurance on a Policy that maintains a
guarantee may require higher or lower premiums, respectively, to maintain the
guarantee (see "Premiums--Payment of Premiums"). A death benefit option change
that increases the specified face amount will result in the establishment of
an increased surrender charge. A death benefit option change that decreases
the specified face amount may result in the deduction of a surrender charge
(see "Charges and Deductions--Surrender Charge").
THE POLICY OWNER SHOULD CONSIDER THE EFFECT OF A CHANGE IN THE SPECIFIED
FACE AMOUNT OR DEATH BENEFIT OPTION ON THE OWNER'S ABILITY TO KEEP A
GUARANTEED MINIMUM DEATH BENEFIT IN EFFECT AFTER SUCH CHANGE.
CASH VALUE
The total cash value of a Policy at any time is the sum of the Policy's cash
values in the Fixed Account (see "The Fixed Account"), the Policy Loan Account
(see "Policy Rights--Loan Privileges"), and the investment divisions of the
Separate Account at such time. The Policy's cash value in the Separate Account
may increase or decrease on each Valuation Date depending on the investment
return of the chosen investment divisions of the Separate Account (see "Sepa-
rate Account Net Investment Return"). There is no guaranteed minimum cash
value in the Separate Account.
Calculation of Separate Account Cash Value. 20 days after the Investment
Start Date, the Policy's cash value in an investment division will equal the
portion of any net premium allocated to the investment division, reduced by
the portion of the first monthly deduction allocated to the Policy's cash
value in that investment division (see "Payment and Allocation of Premiums--
Allo-cation of Premiums and Cash Value"). Thereafter, on each Valuation Date,
the Policy's cash value in an investment division of the Separate Account will
equal:
(1) The cumulative net premium payments allocated to the investment division;
plus
(2) All cash values transferred to the investment division from the Fixed Ac-
count, from the Policy Loan Account upon loan repayment (including all in-
terest
credited on loaned amounts) or from another investment division; minus
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(3) Any cash value transferred from the investment division to the Fixed Ac-
count, to the Policy Loan Account upon taking out a loan or to another in-
vestment division; minus
(4) Any partial cash withdrawal from the investment division and the amount of
any surrender charge that has been deducted from that division; minus
(5) The portion of the cumulative monthly deductions allocated to the Policy's
cash value in the investment division (see "Charges and Deductions--
Monthly Deduction from Cash Value"); minus
(6) The portion of any transfer charge allocated to the Policy's cash value in
the investment division (see "Charges and Deductions--Transfer Charge");
plus
(7) The cumulative net investment return (discussed below) on the net amount
of cash value in the investment division.
The Policy's total cash value in the Separate Account equals the sum of the
Policy's cash value in each investment division.
Separate Account Net Investment Return. A Separate Account investment divi-
sion's net investment return is determined as of the end of each Valuation
Date. All transactions and calculations with respect to the Policies as of any
Valuation Date are determined as of such time.
Each Separate Account division is credited with a rate of investment return
equal to its gross rate of investment return during the Valuation Period which
may be reduced by a charge for Metropolitan Life's taxes, if any such tax
charge becomes necessary in the future (see "Charges and Deductions--Charges
Against the Separate Account"). The investment division's gross rate of in-
vestment return is equal to the rate of increase or decrease in the net asset
value per share of the underlying Fund portfolio over the Valuation Period,
adjusted upward to take appropriate account of any dividends paid by the port-
folio during the period.
Depending primarily on the investment experience of the underlying Fund
portfolio, a Separate Account investment division's net investment return may
be either positive or negative during a Valuation Period.
From time to time the Separate Account may advertise its performance ranking
and rating information among similar investments as compiled by Lipper Analyt-
ical Services Inc., Morningstar, Inc. and other independent organizations. In
addition, Metropolitan Life may advertise ratings assigned by independent rat-
ing agencies that are relevant when considering the guarantees provided by
Metropolitan Life.
From time to time the Separate Account may compare the performance of its
investment divisions with the performance of common stocks, long-term govern-
ment bonds, long-term corporate bonds, intermediate-term government bonds,
Treasury Bills, certificates of deposit and savings accounts. The Separate Ac-
count may use the Consumer Price Index in its advertisements as a measure of
inflation for comparison purposes. Personalized illustrations based on histor-
ical Separate Account performance may also be provided.
BENEFIT AT FINAL DATE
If the insured is living, Metropolitan Life will pay to the Policy owner the
cash value of the Policy on the Final Date, reduced by any outstanding indebt-
edness (see "Policy Benefits--Cash Value"). The Final Date of a Policy is the
Policy anniversary on which the insured is 95 (see "Federal Tax Matters").
OPTIONAL INCOME PLANS
During the insured's lifetime, the Policy owner may arrange for the insur-
ance proceeds to be paid in a single sum, in an account that earns interest or
under one or more of the available optional income plans. For more specifics
regarding optional income plans, see the Appendix to Prospectus. These choices
are also available at the Final Date and if the Policy is surrendered. If no
election is made, Metropolitan Life will place the amount in an account that
earns interest. The payee will have immediate access to all or any part of the
account.
When the insurance proceeds are payable in a single sum, the beneficiary
may, within one year of the insured's death, select one or more of the op-
tional income plans, if no payments have yet been made. If the insurance pro-
ceeds become payable under an optional income plan and the beneficiary has the
right to withdraw the entire amount, the beneficiary may name and change con-
tingent beneficiaries.
OPTIONAL INSURANCE BENEFITS
Subject to certain requirements, one or more of the optional insurance bene-
fits described in the Appendix to the Prospectus, may be included with a Pol-
icy by rider. The cost of any optional insurance benefits will be deducted as
part of the monthly deduction (see "Charges and Deductions--Monthly Deduction
From Cash Value"). There is no charge for the accelerated death benefit rider.
See the Appendix to the Prospectus, for a discussion of how certain riders af-
fect the benefits and the
16
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exercise of certain rights under the Policy. The addition of optional insur-
ance benefits may increase the premiums required to keep the minimum guaran-
teed death benefit in effect. Policy owners should consider their ability to
maintain a minimum guaranteed death benefit when adding optional insurance
benefits.
PAYMENT AND ALLOCATION OF PREMIUMS
...............................................................................
ISSUANCE OF A POLICY
Individuals wishing to purchase a Policy must complete an application which
will be sent to the Designated Office. A Policy will not be issued with a
specified face amount less than the Minimum Initial Specified Face Amount. A
Policy will generally be issued only to insureds 80 years of age or under who
supply evidence of insurability satisfactory to Metropolitan Life. Metropoli-
tan Life may, however, at its sole discretion, issue a Policy to an individual
above Age 80. Acceptance is subject to Metropolitan Life's underwriting rules,
and Metropolitan Life reserves the right to reject an application for any rea-
son permitted by law.
The Date of Policy is the date used to determine Policy years and Policy
months regardless of when the Policy is delivered. The Date of Policy will or-
dinarily be the date the application is approved. Within limits, Metropolitan
Life may establish an earlier Date of Policy (but no earlier than the date the
application is completed) if desired to preserve a younger age at issue for
the insured. Individuals may also request that the Date of Policy be the date
the application is completed if a payment of at least $2,500 is received with
the application. In these instances, the Policy owner will incur a charge for
insurance protection under the Policy where the insurance is in force under
the temporary insurance agreement described below. However, an earlier Date of
Policy has the potential advantage, to the Policy owner, of an earlier Invest-
ment Start Date if a payment is received with the application. In the case of
certain payroll deduction plans, or other automatic investment plans, the Date
of Policy may be earlier or later than the date the first premium payment is
received, pursuant to established administrative rules.
If a premium payment equivalent to at least one "check-o-matic" payment is
received with the application, and there has been no material misrepresenta-
tion in the application, fixed, temporary insurance equal to the specified
face amount applied for up to a maximum amount of $500,000, provided at no ad-
ditional charge, will start as of the date the application was completed and
will continue for a maximum of 90 days. However, if a medical examination of a
person to be insured is initially required by the underwriting rules of Metro-
politan Life, coverage on that person will not start until completion of the
examination. If it is not completed within 90 days from the date of the appli-
cation, there will be no coverage, except that, if the person to be insured
dies from an accident within 30 days from the date of the application and be-
fore the examination is completed, temporary insurance will be in effect if it
has not already ended under the terms of the temporary insurance agreement. In
no event will a death benefit be provided under the temporary insurance agree-
ment if death is by suicide.
Metropolitan Life will allocate net premiums to the Fixed Account on the In-
vestment Start Date. Allocation of net premium payments with respect to the
investment divisions of the Separate Account are effective 20 days after the
Investment Start Date.
Except as otherwise provided in any temporary insurance agreement, there
will be no insurance coverage under a Policy unless at the time the Policy is
delivered the insured's health is the same as stated in the application and,
in most states, the insured has not sought medical advice or treatment subse-
quent to the date of the application.
PREMIUMS
Payment of Premiums. Each Policy owner will determine a voluntary planned
periodic premium schedule that provides for the payment of a level premium at
fixed intervals for a specified period of time. The Policy owner is not re-
quired to pay premiums in accordance with the voluntary planned periodic pre-
mium schedule.
IF NO GUARANTEED MINIMUM DEATH BENEFIT IS IN EFFECT, THE PAYMENT OF PREMIUMS
DOES NOT GUARANTEE THAT THE POLICY REMAINS IN FORCE. Instead, the duration of
the Policy depends upon the Policy's cash surrender value (see "Policy Termi-
nation and Reinstatement--Termination").
The Policy owner must designate in the application one of the following ways
to pay the voluntary planned periodic premium. The Policy owner may elect to
pay the planned periodic premium annually, semi-annually, or monthly through
"check-o-matic" payments. Monthly "check-o-matic" payments are automatically
made by preauthorized transfers from a bank checking account. A Policy owner
may also elect to pay monthly voluntary planned periodic premiums through
other systematic payment plans or through various payroll deduction plans if
provided by the employer of the Policy owner. In certain situations Metropoli-
tan Life may permit the payment of monthly voluntary planned periodic premiums
in another manner. Any such payment method will be
17
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...............................................................
made available in a manner that will not discriminate unreasonably or unfairly
against any Owner.
Subject to the maximum premium limitations described below, a Policy owner
may make unscheduled premium payments at any time. The Policy, therefore, pro-
vides the owner with the flexibility to vary the frequency and amount of pre-
mium payments to reflect changing financial conditions.
All premium payments after the initial premium payment are credited to the
Separate Account or Fixed Account as of the Date of Receipt.
Premiums for Guaranteed Minimum Death Benefit. There are minimum premium
amounts required to keep the guarantee in effect which vary based on several
factors including the duration of the guarantee, specified face amount, smok-
ing class, underwriting class, death benefit option and any riders added to
the Policy, each as then in effect, as well as the issue age and sex of the
insured. Changes in certain of these factors will impact the premiums required
to maintain these guarantees.
Generally, for a given owner, the premium required to maintain the guaran-
teed minimum death benefit will be higher: (i) for death benefit option B, and
death benefit option C, than for death benefit option A; (ii) the longer the
duration of the guaranteed minimum death benefit; and (iii) for higher speci-
fied face amounts. To maintain a guaranteed minimum death benefit these re-
quired premiums must be paid for the entire guaranteed minimum death benefit
period. The Policy is tested on each monthly anniversary in order to verify
that a sufficient amount of premium (less partial withdrawals and outstanding
Policy loans) has been paid to keep the guaranteed minimum death benefit in
force.
Premium Limitations. During the first Policy year, premium payments by a
Policy owner must at least equal the Minimum Initial Premium for the particu-
lar Policy or the Policy will terminate after the grace period.
Except as described below, the total of all premiums paid, both planned and
unplanned, can never exceed the then current maximum premium limitation deter-
mined by Internal Revenue Code rules relating to the definition of life insur-
ance (See "Federal Tax Matters"). If at any time a premium is paid that would
result in total premiums exceeding the then current maximum premium limita-
tions, Metropolitan Life will accept only that portion of the premium that
will make total premiums equal the limit. Any part of the premium in excess of
that amount will be refunded, and no further premiums will be accepted until
allowed by the maximum premium limitations. These limitations will not apply
to any premium that is required to be paid in order to prevent the Policy from
terminating. An increase or reduction in benefits would result in an adjust-
ment of these premium limits. In addition, a reduction in benefits could re-
sult in a required distribution from the Policy which may be taxed on an in-
come first basis if the reduction occurs in the first 15 Policy years.
There may be cases where the total of all premiums paid could cause the Pol-
icy to be classified as a modified endowment contract (see "Federal Tax Mat-
ters"). The annual statement (see "Reports") sent to each Policy owner will
include information regarding the modified endowment contract status of a Pol-
icy. In cases where a Policy is not an irrevocable modified endowment con-
tract, the annual statement will indicate what action the Policy owner can
take to reverse the modified endowment contract status of the Policy.
Every voluntary planned periodic premium payment after the first Policy year
must be at least $200 on an annual basis, $100 on a semi-annual basis and $15
on a "check-o-matic" or other pre-authorized transfer or payment basis. For
some Policies distributed through brokers (see "Distribution of the Poli-
cies"), the voluntary planned periodic premium for the first Policy year may
be required to add up to at least $2,500. Every unplanned premium payment must
be at least $250. Premium payments less than these minimum amounts will be re-
funded to the Policy owner.
ALLOCATION OF PREMIUMS AND CASH VALUE
Net Premiums. The net premium equals the premium paid less premium expense
charges (see "Charges and Deductions--Premium Expense Charges").
Allocation of Net Premiums. In the application for a Policy, the Policy
owner indicates the initial allocation of net premiums among the Fixed Account
and the investment divisions of the Separate Account. The minimum percentage
of each premium that may be allocated to the Fixed Account or any investment
division of the Separate Account is 10%. Allocation percentages must be in
whole numbers; for example, 33 1/3% may not be chosen. The Policy owner may
change the allocation of future net premiums without charge at any time by
providing Metropolitan Life with written notification at the Designated Office
or in another form of communication acceptable to Metropolitan Life. The
change will be effective as of the Date of Receipt of the notice at the Desig-
nated Office.
The Policy's cash value in the investment divisions of the Separate Account
will vary with the investment experience of these investment divisions, and
the Policy owner bears this investment risk. Policy owners should periodically
review their allocations of net premiums and cash values in light of market
conditions and their overall financial planning requirements.
18
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...............................................................
Cash Value Transfers. The Policy owner may transfer cash value between the
Fixed Account and the investment divisions of the Separate Account and among
the investment divisions of the Separate Account. At the present time, there is
no charge for transfers. Metropolitan Life reserves the right in the future to
assess a charge of up to $25 against each transfer and to limit the number of
transfers to four per Policy year. A transfer must be made in either dollar
amounts or a percentage in whole numbers. The minimum amount that may be trans-
ferred is the lesser of $50 or the total amount in an investment division or,
if the transfer is from the Fixed Account the total amount in the Fixed Ac-
count. Transferring cash value from one or more investment divisions and/or the
Fixed Account into one or more other investment divisions and/or the Fixed Ac-
count counts as one transfer. Metropolitan Life reserves the right to delay the
transfer, withdrawal, surrender and payment of policy loans of amounts from the
Fixed Account or to process such transfer requests only on or about the Policy
anniversary date (see "The Fixed Account--Transfers, Withdrawals, Surrenders,
and Policy Loans"). Metropolitan Life will effectuate transfers and determine
all values in connection with transfers as of the Date of Receipt of written
notice at the Designated Office.
Transfers are not taxable transactions under current law. Transfer requests
must be in writing in a form acceptable to Metropolitan Life, or in another
form of communication acceptable to Metropolitan Life.
Automated Investment Strategies. Metropolitan Life may permit the Policy
owner to submit a written authorization directing Metropolitan Life to make
transfers on a continuing periodic basis from one investment division to an-
other or to the Fixed Account. Metropolitan Life currently offers four such in-
vestment strategies: the "Equity Generator," the "Equalizer," the "Allocator"
and the "Rebalancer." Only one automated investment strategy may be in effect
at any one time. The Owner may submit a written request electing a strategy or
directing Metropolitan Life to cancel a strategy at any time.
Under the "Equity Generator," Policy owners may have the interest earned on
amounts in the Fixed Account transferred to the MetLife Stock Index Division or
the State Street Research Aggressive Growth Division, as elected by the Policy
owner. Any such transfer from the Fixed Account to the MetLife Stock Index Di-
vision or the State Street Research Aggressive Growth Division, as applicable,
will be made at the beginning of each Policy month following the Policy month
in which the interest is earned. The transfer will only be made for a month
during which at least $20 in interest is earned. Amounts earned during a month
in which less than $20 in interest is earned will remain in the Fixed Account.
Under the "Equalizer," at the end of a specified period (e.g. monthly, quar-
terly) as determined by Metropolitan Life, a transfer is made from the MetLife
Stock Index Division or the State Street Research Aggressive Growth Division,
as elected by the Policy owner, to the Fixed Account or from the Fixed Account
to such elected investment division in order to make the Fixed Account and such
elected investment division equal in value. While the "Equalizer" is in effect,
any cash value transfer out of any elected investment division or the Fixed Ac-
count that is not part of this automated investment strategy will automatically
terminate the "Equalizer" election. The Policy owner may then reelect the
"Equalizer" strategy to become effective on the next Policy anniversary.
Under the "Allocator," at the beginning of each Policy month, an amount des-
ignated by the Policy owner is transferred from the Fixed Account to any in-
vestment division(s) specified by the Owner. The Policy owner may choose to do
this in one of the following three ways: (1) designating an amount to be trans-
ferred from the Fixed Account each month until amounts in that investment divi-
sion are exhausted; (2) designating an amount to be transferred from the Fixed
Account for a certain number of months; or (3) designating a total amount to be
transferred from the Fixed Account in equal monthly installments over a certain
number of months. The Policy owner's designations must allow the "Allocator" to
remain in effect for at least three months.
Under the "Rebalancer," Policy owners may elect the periodic redistribution
of cash value so that the cash value is allocated among the Fixed Account and
the investment divisions of the Separate Account in the same proportion as the
net premiums are allocated. Metropolitan Life will redistribute the cash value
at the beginning of each calendar quarter.
Telephonic Transactions. Metropolitan Life reserves the right, if permitted
by state law, to allow Policy owners to make transfer requests, changes to the
Automatic Investment Strategies and reallocation of future net premiums by tel-
ephone and to allow Policy owners to authorize their sales representatives to
make such requests on behalf of the Policy owners by telephone. The Policy
owner must authorize these types of transactions in the manner prescribed by
Metropolitan Life. If Metropolitan Life decides to permit any of these proce-
dures, and a Policy owner elects to participate in any of them, the following
will apply: the Policy owner will authorize Metropolitan Life to act upon the
telephone instructions of any person purporting to be the Policy owner (or, if
applicable, the Policy owner's sales representative), assuming Metropolitan
Life's procedures have been followed, to do the transactions both regarding
amounts in the Policy's Fixed Account and in the Separate Account. Metropolitan
Life will institute reasonable procedures to
19
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...............................................................
confirm that any instructions communicated by telephone are genuine. All tele-
phone calls will be recorded, and the Policy owner (or, if applicable,
the Policy owner's sales representative) will be asked to produce the Policy
owner's personalized data prior to Metropolitan Life honoring any requests by
telephone. Additionally, as with other transactions, the Policy owner will re-
ceive a written confirmation of each telephonically requested transaction.
Neither Metropolitan Life nor the Separate Account will be liable for any
loss, expense or cost arising out of any requests that Metropolitan Life or
the Separate Account reasonably believe to be genuine. In the event that these
procedures are instituted and in the further event that the Policy owner who
has elected to use such procedures encounters difficulty with them, such Pol-
icy owner should make inquiry to the Designated Office.
POLICY TERMINATION AND REINSTATEMENT
Termination. Insurance coverage under the Policy will continue until the Fi-
nal Date, unless the cash surrender value is insufficient to cover the monthly
deduction at a time when no minimum guaranteed death benefit is in effect. On
any such monthly anniversary, Metropolitan Life will notify the Policy owner
and any assignee of record. The Policy owner will then have a grace period of
61 days, measured from the monthly anniversary, to make sufficient payment.
The minimum necessary payment must be an amount such that the net cash surren-
der value is sufficient to support one monthly deduction. Failure to make a
sufficient payment within the grace period will result in termination of the
Policy without any cash surrender value. If the insured dies during the grace
period, the insurance proceeds will still be payable, but any due and unpaid
monthly deductions accruing during the grace period will be deducted from the
proceeds.
Reinstatement. A terminated Policy may be reinstated anytime within 3 years
(5 years in Missouri and North Carolina) after the end of the grace period and
before the Final Date by submitting the following items to Metropolitan Life:
(1) a written application for reinstatement; (2) evidence of insurability sat-
isfactory to Metropolitan Life; and (3) a premium that, after the deduction of
the premium expense charges (see "Charges and Deductions--Premium Expense
Charges"), is large enough to cover: (a) the monthly deductions for at least
the two Policy months commencing with the effective date of reinstatement; (b)
any due and unpaid monthly Policy charges incurred during the first Policy
year; (c) any portion of the surrender charge which was not paid at termina-
tion because the cash value at termination was insufficient to pay such por-
tion of the charge; and (d) interest at the rate of 6% per year on the amount
set forth in (b) from the commencement of the grace period to the date of re-
instatement. Metropolitan Life reserves the right to waive the interest due
set forth in (d) above.
Notwithstanding the above, at the present time, with respect to the rein-
statement of a Policy that is terminated during the first two Policy years,
Metropolitan Life will accept as the premium required for reinstatement the
lesser of the amount as defined in the immediately preceding paragraph and the
following: the excess of the sum of (a) the monthly deductions for at least
the two Policy months commencing with the effective date of reinstatement; and
(b) the total of the minimum required premiums that would have been payable
under the Policy from the date of the Policy until the effective date of rein-
statement had no termination occurred, over the sum of all premiums paid by
the Policy owner to the effective date of the termination before any charges
or deductions were applied. Metropolitan Life offers this alternative calcula-
tion of the premium required for reinstatement at present but reserves the
right to modify or rescind this offer at its sole discretion.
Indebtedness on the date of termination will be cancelled and need not be
repaid and will not be reinstated. The amount of cash surrender value on the
date of reinstatement will be equal to two monthly deductions plus any amount
of net premiums paid at reinstatement in excess of the amount of premium re-
quired above to reinstate the Policy.
The date of reinstatement will be the date of approval of the application
for reinstatement. The terms of the original Policy, including the insurance
rates provided therein, will apply to the reinstated Policy. A reinstated Pol-
icy is subject to a new two year period of contestability (see "Other Policy
Provisions--Incontestability"). The guaranteed minimum death benefit may not
be reinstated.
CHARGES AND DEDUCTIONS
...............................................................................
Metropolitan Life incurs many expenses and risks in connection with the Pol-
icies. It is compensated for these out of all of the charges discussed below.
Although different purposes are ascribed below to different charges, such dis-
tinctions are imprecise. Metropolitan Life is free to retain any and all reve-
nues or profits that result from any of these charges or to apply such reve-
nues or profits to any other purposes, including any costs and expenses in
connection with the Policies.
PREMIUM EXPENSE CHARGES
Sales Load. A charge (which may be deemed to be a sales load as defined in
the 1940 Act) is deducted
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from each premium payment received by Metropolitan Life as described below. A
charge of 2.25% of premiums paid is deducted from all premium payments. There
is also a charge (which may be deemed to be a sales load) upon the surrender
of a Policy during the first fifteen Policy years or during the first fifteen
Policy years after an increase in the specified face amount of a Policy (see
"Surrender Charge").
Tax Charges. Two charges are currently made for taxes related to premiums.
These taxes include any federal, state or local taxes measured by or based on
the amount of premiums received by Metropolitan Life. A charge of 1.25% of
each premium payment is made for the purpose of recovering the federal income
taxes of Metropolitan Life that are determined by the amount of premiums re-
ceived in connection with the Policy (the "DAC tax charge"). An additional
charge is made for state premium taxes of 2% of each premium payment. Premium
taxes vary from state to state ranging from zero to 3.5% currently. The 2%
rate approximates the average tax rate expected to be paid on premiums from
all states.
TRANSFER CHARGE
At the present time, no charge will be assessed against the cash value of a
Policy when amounts are transferred among the investment divisions of the Sep-
arate Account and between the investment divisions and the Fixed Account. Met-
ropolitan Life reserves the right in the future to assess a charge of up to
$25 against each transfer. If made, the charge would be allocated among the
Fixed Account and each investment division of the Separate Account from which
amounts are transferred in the same proportion that the amounts transferred
from the Fixed Account and the amounts transferred from each investment divi-
sion bear to the total amount transferred, when the requested transfer is ef-
fected. Charges will not be assessed for transfers made under the "Equalizer,"
"Equity Generator," "Allocator" or "Rebalancer" (see "Allocation of Premiums
and Cash Value--Automated Investment Strategies").
MONTHLY DEDUCTION FROM CASH VALUE
The monthly deduction from cash value includes the cost of term insurance
charge, the charge for optional in surance benefits added by rider, the admin-
istration charge and the mortality and expense risk charge. The monthly deduc-
tion will also include a charge for requested increases in the specified face
amount for each of the 12 months following the increase, as discussed more
fully under "Policy Benefits--Increases".
The monthly deduction will be deducted as of each monthly anniversary com-
mencing with the Date of Policy. At issue and within 30 days of any policy
anniversary, the Policy owner may choose (1) to have monthly deductions allo-
cated among the Fixed Account and each Investment Division in proportion to
the Policy's cash value at the beginning of the policy month (i.e., on a "Pro
Rata Basis"); or (2) to have all monthly deductions taken from the Fixed Ac-
count exclusively. In the latter case, any time money in the Fixed Account is
insufficient to cover the monthly deduction, deductions will be made on a Pro
Rata Basis from the Separate Account. If a Policy owner chooses to have all
deductions made from the Fixed Account, all amounts removed from the Policy's
cash value (including partial withdrawals, policy loans surrender charges and
transfer charges) will also be made from the Fixed Account, and then on a Pro
Rata basis, if necessary. See "Payment and Allocation of Premiums--Issuance of
a Policy", regarding when insurance coverage starts under a newly issued Poli-
cy.
Cost of Term Insurance. Because the cost of term insurance depends upon a
number of variables, it can vary from month to month. Metropolitan Life will
determine the monthly cost of term insurance charge by multiplying the appli-
cable cost of term insurance rate or rates by the term insurance amount for
each Policy month. The term insurance amount for a Policy month is (a) the
death benefit at the beginning of the Policy month divided by 1.0024663 (a
discount factor to account for return deemed to be earned during the month),
less (b) the cash value at the beginning of the Policy month after the deduc-
tion of other applicable charges.
The term insurance amount may be affected by changes in the cash value or in
the specified face amount of the Policy and will be greater for owners who
have selected Death Benefit Option B, or Death Benefit Option C prior to pol-
icy anniversary 65, than for those who have selected Death Benefit Option A,
or Death Benefit Option C on and after policy anniversary 65 (see "Policy Ben-
efits--Death Benefits"), assuming the same specified face amount in each case
and assuming that the alternative death benefit is not in effect. Since the
death benefit under Option A, and under Option C on and after policy anniver-
sary 65, remains constant while the death benefit under Option B, and under
Option C prior to policy anniversary 65, varies with the cash value, cash
value increases will generally reduce the term insurance amount under Option
A, and Option C on and after policy anniversary 65, but not under Option B,
and Option C prior to policy anniversary 65. If the term insurance amount is
greater, the cost of insurance will be greater. If the alternative death bene-
fit is in effect (see "Death Benefit Options--Alternative Death Benefit"),
then the cost of term insurance will vary directly with the cash value under
all of the death benefit options.
In those cases where the specified face amount of the Policy does not change
as a result of the Option
21
<PAGE>
...............................................................
change (i.e., converting from Option B to C (when permitted), from Option C to
Option B before Policy anniversary 65 or from Option C to Option A after Pol-
icy anniversary 65), the cost of term insurance will not change.
Cost of Term Insurance Rate. Cost of term insurance rates are based on the
sex (except in Montana, in the case of group conversions which require unisex
rates and in the case of Policies sold in connection with executive bonus and
split dollar deferred compensation plans), age and rate class of the insured.
The actual monthly cost of term insurance rates will be based on Metropolitan
Life's expectations as to future experience. They will not, however, be
greater than the guaranteed cost of term insurance rates set forth in the Pol-
icy. These guaranteed rates are based on certain of the 1980 Commissioners
Standard Ordinary Mortality Tables and the insured's sex and age. The Tables
used for this purpose set forth different mortality estimates for males and
females. Any change in the cost of term insurance rates will apply to all per-
sons of the same insuring age, sex, and rate class whose Policies have been in
force for the same length of time. Metropolitan Life reviews its cost of term
insurance rates periodically and may adjust the rates from time to time.
Rate Class. The rate class of an insured affects the cost of term insurance
rate. Metropolitan Life currently places insureds into a standard rate class
or rate classes involving a higher or lower mortality risk. For Ages 18 and
over, each such rate class is further divided into a smoker division and a
nonsmoker division. In an otherwise identical Policy, insureds in the standard
rate class will have a lower cost of term insurance than those in the rate
class with the higher mortality risk, and a higher cost of term insurance than
those in the rate class with the lower mortality risk. Also, those insureds in
the nonsmoker division of a rate class will have a lower cost of term insur-
ance than those in the smoker division of the same rate class.
If a Policy owner requests a specified face amount increase at a time when
the insured is in a less favorable rate class or division than previously, a
correspondingly higher cost of insurance rate will apply to that portion of
the term insurance amount attributable to the increase. On the other hand, if
the insured's rate class or division improves, the lower cost of insurance
rate will apply to the entire term insurance amount.
Administration Charge. For all Policies there will be a monthly administra-
tion charge. For the first Policy year the charge will be based on the Age of
the insured at issue. The charge is equal to $20 per month for ages less than
26, $30 per month for ages 26 to 40; $35 per month for ages 41 and over. After
the first Policy year the monthly administration charge is $10.00 per month.
For any Policy, this charge may be reduced in any month during which the cumu-
lative premiums paid or the premium payment attributable to that month (net of
Policy loans and withdrawals) meet the minimum premium requirements that would
maintain a guaranteed minimum death benefit to Age 65 for such Policy if
available, otherwise to the next shortest duration available. If no guarantee
is available, the necessary amount will be specified in the Policy. If the
premium requirements have been satisfied, the administration charge after the
first Policy year is $5 per month for Policies with a specified face amount of
$250,000 or more, $6.00 per month for Policies with a specified face amount of
$100,000 to $249,999 and $7 per month for Policies with a specified face
amount of less than $100,000. The monthly administration charge and the deter-
mination of whether the premium requirements have been satisfied will be de-
termined at the time the monthly deduction is made. Thus, any change in speci-
fied face amount of a Policy or change in premiums paid may result in a change
in the monthly administration charge.
These charges will be used to compensate Metropolitan Life for expenses in-
curred in the administration of the Policy. (See "Premiums"). The first year
charge will also compensate Metropolitan Life for first year underwriting and
other start-up expenses incurred in connection with the Policy. These expenses
include the cost of processing applications, conducting medical examinations,
determining insurability and the insured's risk class, and establishing Policy
records. If a Policy is surrendered in the first Policy year, the remaining
administration charge for each of the full Policy months remaining in the
first Policy year will be deducted from the cash value of the Policy in addi-
tion to any applicable surrender charge (see "Surrender Charge").
Charge for Mortality and Expense Risks. A monthly charge is made for mortal-
ity and expense risks assumed by Metropolitan Life. The amount of the charge
is equivalent to a monthly rate of .075% of the cash value in the Separate Ac-
count on each monthly anniversary. Beginning after Policy year 10, this charge
may be reduced to .05%. However, this reduction is not guaranteed.
The mortality risk assumed is that insureds may live for a shorter period of
time than estimated and, thus, a greater amount of death benefits than ex-
pected will be payable. The expense risk assumed is that expenses incurred in
issuing and administering the Policies will be greater than estimated. Metro-
politan Life will realize a gain if the charges prove ultimately to be more
than sufficient to cover its actual costs of such mortality and expense com-
mitments. If the charges are not sufficient, the loss will fall on Metropoli-
tan Life. If its estimates of future mortality and expense experience are ac-
curate, Metropolitan Life anticipates that it will realize a profit from the
mortality and expense risk charge; however if such estimates are inaccurate,
Metropolitan Life could incur a loss.
22
<PAGE>
...............................................................
CHARGE AGAINST THE SEPARATE ACCOUNT
Charge for Income Taxes. Currently, no charge is made against the Separate
Account for income taxes. However, Metropolitan Life may decide to make such a
charge in the future (see "Federal Tax Matters--Taxation of Metropolitan
Life").
SURRENDER CHARGE
A sales charge may be deducted in the form of a surrender charge from the
cash value (i) if there is a cash value withdrawal; (ii) if the Policy is
surrendered or terminated; or (iii) if there is a reduction in the specified
face amount (excluding any reduction that results from a change in death
benefit option). No surrender charge will be deducted on partial withdrawals in
each Policy year of up to 10% of the cash surrender value at the time of the
withdrawal. This 10% surrender charge free withdrawal does not apply to
reductions in specified face amount. No surrender charge will be imposed on any
decrease in specified face amount that is the result of a partial withdrawal
(although any surrender charge applicable to the partial withdrawal itself will
be imposed). In addition, no surrender charge will be attributable to an
automatic increase in specified face amount caused by a change in death benefit
option.
The surrender charge as of any date is computed by first determining the per-
cent applicable to (1) the initial specified face amount and (2) any increase
therein that remains in effect, as set forth in the chart below based on the
length of time such specified amount has been in force. The percent thus deter-
mined is multiplied by the surrender charge measure (or, if the percent relates
to a specified face amount increase, by the increase surrender charge measure
associated with that increase). That gives the surrender charge that would be
imposed on a surrender of the entire cash value (less any 10% surrender charge
free withdrawal), or of the entire specified face amount, during the Policy
years shown in the chart below.
<TABLE>
<CAPTION>
PERCENT
POLICY YEAR SINCE ISSUE OR YEAR SINCE OF
SPECIFIED FACE AMOUNT INCREASE MEASURE*
- ------------------------------------- --------
<S> <C>
1...................................................................... 100%
2...................................................................... 100
3...................................................................... 90
4...................................................................... 80
5...................................................................... 70
6**.................................................................... 60
7...................................................................... 54
8...................................................................... 48
9...................................................................... 42
10..................................................................... 36
11..................................................................... 30
12..................................................................... 24
13..................................................................... 18
14..................................................................... 12
15..................................................................... 6
16 and later........................................................... 0
</TABLE>
- -----
* The measures are described in the "Definitions" portion of this prospectus
under "Surrender Charge Measure" and "Increase Surrender Charge Measure."
** After the fifth Policy Year the surrender charges will decrease each Policy
month.
To the extent that a partial withdrawal is subject to a surrender charge, the
surrender charge will be prorated based on the ratio of (A) the withdrawn
amount (less the 10% charge-free amount in each Policy year) to (B) the
Policy's then total cash surrender value. The Policy's surrender charge meas-
ure, and any increase surrender charge measure, are also thereupon decreased
based on the same ratio.
For purposes of computing any surrender charge applicable to a partial
reduction in specified face amount, the reduction is used to offset any
specified face amount increases in reverse chronological order to the way they
were added and finally is used to offset the specified face amount at issue.
Any remaining amount of the surrender charge that was originally established in
connection with each portion of specified face amount then canceled will be
deducted. If only a portion of the original specified face amount (or of an
increase therein) is canceled, only a pro-rata amount of any remaining
surrender charge associated with such original specified face amount (or
increase) will be deducted.
Surrender charges will be deducted from the cash value in the same manner
that the monthly deduction is taken to the extent the cash value is sufficient.
Otherwise the charges will reduce the amount paid to the owner.
BECAUSE THE SURRENDER CHARGE MEASURES AND PERCENTAGES ARE CAPPED AT THE END
OF THE SECOND POLICY YEAR, OR SECOND YEAR FROM ANY INCREASE IN SPECIFIED FACE
AMOUNT, A POLICY OWNER MAY BE ABLE TO LIMIT THE SURRENDER CHARGES BY LIMITING
THE PAYMENT OF PREMIUMS ABOVE THE LEVEL NECESSARY TO KEEP THE POLICY AND THE
GUARANTEED MINIMUM DEATH BENEFIT IN EFFECT DURING SUCH YEARS.
GUARANTEE OF CERTAIN CHARGES
Metropolitan Life guarantees, and may not increase, the charges deducted from
premiums, the maximum monthly administration charge, the surrender charge and
the maximum charge for mortality and expense risks with respect to the Poli-
cies.
OTHER CHARGES
Fund Investment Management Fee. Shares of the Fund are purchased for the Sep-
arate Account at their net asset value. The net asset value of Fund shares is
determined after deduction of the fee for investment management services and
the deduction of direct expenses from the assets of the Fund as more fully de-
scribed under "Fund Investment Management Fees and Direct Expenses" and in the
attached prospectus for the Fund.
23
<PAGE>
...............................................................
ILLUSTRATIONS OF DEATH BENEFITS, CASH VALUES, CASH SURRENDER VALUES AND
ACCUMULATED PREMIUMS
...............................................................................
The tables in this section illustrate the way in which a Policy's death ben-
efit, cash value and cash surrender value could vary over an extended period
of time assuming that all premiums are allocated to and remain in the Separate
Account for the entire period shown and hypothetical gross investment rates of
return for the Fund (i.e., investment income and capital gains and losses, re-
alized or unrealized) equivalent to constant gross (after tax) annual rates of
0%, 6% and 12%. The tables are based on the payment of annual planned premiums
(see "Premiums--Premium Limitations"), for a specified face amount of $100,000
for a male aged 35. Each illustration assumes that the insured is in Metropol-
itan Life's standard nonsmoker underwriting risk classification. Illustrations
for an insured in Metropolitan Life's standard smoker underwriting risk clas-
sification would show, for the same age and premium payments, lower cash val-
ues and cash surrender values and, therefore, for the minimum death benefit,
death benefits under Option B and Option C prior to policy anniversary 65,
lower death benefits. The differences between the cash values and the cash
surrender values in the first fifteen years are the surrender charges.
The death benefits, cash values and cash surrender values would be different
from those shown if the actual gross investment rates of return averaged 0%,
6% or 12% over a period of years, but fluctuated above or below such averages
for individual policy years. The values would also be different depending on
the allocation of a Policy's total cash value among the investment divisions
of the Separate Account, if the actual rates of return averaged 0%, 6% or 12%
but the rates for each portfolio of the Fund varied above and below such aver-
ages.
The amounts shown for the death benefits, cash values and cash surrender
values take into account the deductions from premiums and the monthly deduc-
tion from cash value, and the daily charge to the Fund for investment manage-
ment services equivalent to an annual rate of % of the average daily value of
the aggregate net assets of the Fund (which represents the simple average of
the maximum management fees indicated in the Chart of "Metropolitan Series
Fund Annual Expenses" under "Fund Investment Management Fees and Direct Ex-
penses" applicable to the ten available Portfolios of the Fund) and % for
other direct Fund expenses (the simple average of the expenses indicated in
such chart, which takes into account the expense reimbursements described in
the chart). In the illustrations that show "Guaranteed" charges, the monthly
rate for mortality and expense risks is .075% of the cash value in the Sepa-
rate Account on the monthly anniversary and the monthly administration charge
is $30 per month in the first Policy year and $10 per month in the second Pol-
icy year and later. In the illustrations that show "Current" charges, (i) the
monthly rate for mortality and expense risks is .075% of the cash value in the
Separate Account on the monthly anniversary in each of the first ten Policy
years, and .05% in all subsequent years, and (ii) the monthly administration
charge is $30 per month in the first Policy year and $6 per month in the sec-
ond Policy year and later. Because the Policies described in this prospectus
were first offered in 1998, the planned reductions in the mortality and ex-
pense risk and monthly administration charges have not yet taken effect under
any outstanding Policies.
Some of the following illustrations are based on the guaranteed cost of term
insurance rates; the remainder of the illustrations are based on the current
cost of term insurance rates as presently in effect (see "Monthly Deduction
From Cash Value--Cost of Term Insurance Rate").
Taking account of the charges for investment management services and other
Fund expenses, the gross annual investment rates of return of 0%, 6% and 12%
correspond to actual (or net) annual rates of: , and , respectively.
The hypothetical returns shown in the tables do not reflect any charges for
income taxes against the Separate Account since no such charges are currently
made. However, if in the future such charges are made, in order to produce the
death benefits and cash values illustrated, the gross annual investment rate
of return would have to exceed 0%, 6% or 12% by a sufficient amount to cover
the tax charges. (See "Federal Tax Matters--Taxation of Metropolitan Life.")
The second column of the tables shows the amount which would accumulate if
an amount equal to the annual planned premium were invested to earn interest,
after taxes, at 5% compounded annually.
Upon request, Metropolitan Life will furnish an illustration reflecting the
proposed insured's age, sex, the specified face amount or premium amount re-
quested, frequency of planned periodic premium payments, death benefit option
selected and any available rider requested.
24
<PAGE>
FLEXIBLE PREMIUM MULTIFUNDED LIFE INSURANCE POLICY(1)
MALE ISSUE AGE 35
STANDARD NONSMOKER UNDERWRITING RISK SPECIFIED FACE AMOUNT: $100,000--DEATH
BENEFIT OPTION A GUARANTEED COST OF TERM INSURANCE CHARGES
<TABLE>
<CAPTION>
TOTAL CASH
TOTAL CASH VALUE(2) SURRENDER VALUE(2) TOTAL DEATH BENEFIT(2)
PREMIUMS ASSUMING HYPOTHETICAL ASSUMING HYPOTHETICAL ASSUMING HYPOTHETICAL
ACCUMULATED GROSS ANNUAL INVESTMENT GROSS ANNUAL INVESTMENT GROSS ANNUAL INVESTMENT
END OF AT 5% RATES OF RETURN OF RATES OF RETURN OF RATES OF RETURN OF
POLICY INTEREST ------------------------------------------------------------------------
YEAR PER YEAR 0% 6% 12% 0% 6% 12% 0% 6% 12%
------ ----------- ------- ------- --------------- ------- --------------- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1...................... $ $ $ $ $ $ $ $ $ $
2......................
3......................
4......................
5......................
6......................
7......................
8......................
9......................
10......................
15......................
20......................
25......................
40......................
45......................
50......................
</TABLE>
- -------
(1) Assumes annual planned premium payments of $ paid in full at
beginning of each Policy year. The values would vary from those shown if
the amount or frequency of payments varies.
(2) Assumes no policy loan or partial withdrawal has been made. Excessive
loans or withdrawals, adverse investment performance or insufficient
premium payments may cause the Policy to terminate because of insufficient
cash value.
IT IS EMPHASIZED THAT THE HYPOTHETICAL INVESTMENT RATES OF RETURN SHOWN ABOVE
ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF PAST OR
FUTURE INVESTMENT RATES OF RETURN. ACTUAL INVESTMENT RATES OF RETURN MAY BE
MORE OR LESS THAN THOSE SHOWN AND WILL DEPEND UPON A NUMBER OF FACTORS,
INCLUDING THE PREMIUM AND CASH VALUE ALLOCATIONS MADE BY AN OWNER AND THE
DIFFERENT RATES OF RETURN OF THE FUND PORTFOLIOS. THE DEATH BENEFIT, CASH
VALUE AND CASH SURRENDER VALUE FOR A POLICY WOULD BE DIFFERENT FROM THOSE
SHOWN IF THE ACTUAL INVESTMENT RATES OF RETURN AVERAGED 0%, 6% AND 12% OVER A
PERIOD OF YEARS, BUT FLUCTUATED ABOVE OR BELOW THOSE AVERAGES FOR INDIVIDUAL
POLICY YEARS OR IF ANY PREMIUMS WERE ALLOCATED OR CASH VALUE TRANSFERRED TO
THE FIXED ACCOUNT. NO REPRESENTATIONS CAN BE MADE BY METROPOLITAN LIFE OR THE
FUND THAT THESE HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR
OR SUSTAINED OVER ANY PERIOD OF TIME.
25
<PAGE>
FLEXIBLE PREMIUM MULTIFUNDED LIFE INSURANCE POLICY(1)
MALE ISSUE AGE 35
STANDARD NONSMOKER UNDERWRITING RISK SPECIFIED FACE AMOUNT: $100,000--DEATH
BENEFIT OPTION B GUARANTEED COST OF TERM INSURANCE CHARGES
<TABLE>
<CAPTION>
TOTAL CASH
TOTAL CASH SURRENDER TOTAL DEATH
VALUE(2) VALUE(2) BENEFIT(2)
ASSUMING ASSUMING ASSUMING
HYPOTHETICAL HYPOTHETICAL HYPOTHETICAL
GROSS ANNUAL GROSS ANNUAL GROSS ANNUAL
PREMIUMS INVESTMENT INVESTMENT INVESTMENT
ACCUMULATED RATES OF RATES OF RATES OF RETURN
END OF AT 5% RETURN OF RETURN OF OF
POLICY INTEREST -------------- -------------- ---------------
YEAR PER YEAR 0% 6% 12% 0% 6% 12% 0% 6% 12%
------ ----------- ---- ---- ---- ---- ---- ---- ---- ---- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1................... $ $ $ $ $ $ $ $ $ $
2...................
3...................
4...................
5...................
6...................
7...................
8...................
9...................
10...................
15...................
20...................
25...................
40...................
45...................
50...................
</TABLE>
- -------
(1) Assumes annual planned premium payments of $ paid in full at
beginning of each Policy year. The values would vary from those shown if
the amount or frequency of payments varies.
(2) Assumes no policy loan or partial withdrawal has been made. Excessive
loans or withdrawals, adverse investment performance or insufficient
premium payments may cause the Policy to terminate because of insufficient
cash value.
IT IS EMPHASIZED THAT THE HYPOTHETICAL INVESTMENT RATES OF RETURN SHOWN ABOVE
ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF PAST OR
FUTURE INVESTMENT RATES OF RETURN. ACTUAL INVESTMENT RATES OF RETURN MAY BE
MORE OR LESS THAN THOSE SHOWN AND WILL DEPEND UPON A NUMBER OF FACTORS,
INCLUDING THE PREMIUM AND CASH VALUE ALLOCATIONS MADE BY AN OWNER AND THE
DIFFERENT RATES OF RETURN OF THE FUND PORTFOLIOS. THE DEATH BENEFIT, CASH
VALUE AND CASH SURRENDER VALUE FOR A POLICY WOULD BE DIFFERENT FROM THOSE
SHOWN IF THE ACTUAL INVESTMENT RATES OF RETURN AVERAGED 0%, 6% AND 12% OVER A
PERIOD OF YEARS, BUT FLUCTUATED ABOVE OR BELOW THOSE AVERAGES FOR INDIVIDUAL
POLICY YEARS OR IF ANY PREMIUMS WERE ALLOCATED OR CASH VALUE TRANSFERRED TO
THE FIXED ACCOUNT. NO REPRESENTATIONS CAN BE MADE BY METROPOLITAN LIFE OR THE
FUND THAT THESE HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR
OR SUSTAINED OVER ANY PERIOD OF TIME.
26
<PAGE>
FLEXIBLE PREMIUM MULTIFUNDED LIFE INSURANCE POLICY(1)
MALE ISSUE AGE 35
STANDARD NONSMOKER UNDERWRITING RISK SPECIFIED FACE AMOUNT: $100,000--DEATH
BENEFIT OPTION C GUARANTEED COST OF TERM INSURANCE CHARGES
<TABLE>
<CAPTION>
TOTAL CASH
TOTAL CASH SURRENDER TOTAL DEATH
VALUE(2) VALUE(2) BENEFIT(2)
ASSUMING ASSUMING ASSUMING
HYPOTHETICAL HYPOTHETICAL HYPOTHETICAL
GROSS ANNUAL GROSS ANNUAL GROSS ANNUAL
PREMIUMS INVESTMENT INVESTMENT INVESTMENT
ACCUMULATED RATES OF RATES OF RATES OF
END OF AT 5% RETURN OF RETURN OF RETURN OF
POLICY INTEREST -------------- -------------- --------------
YEAR PER YEAR 0% 6% 12% 0% 6% 12% 0% 6% 12%
------ ----------- ---- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1.................... $ $ $ $ $ $ $ $ $ $
2....................
3....................
4....................
5....................
6....................
7....................
8....................
9....................
10....................
15....................
20....................
25....................
40....................
45....................
50....................
</TABLE>
- -------
(1) Assumes annual planned premium payments of $ paid in full at beginning
of each Policy year. The values would vary from those shown if the amount
or frequency of payments varies.
(2) Assumes no policy loan or partial withdrawal has been made. Excessive
loans or withdrawals, adverse investment performance or insufficient
premium payments may cause the Policy to terminate because of insufficient
cash value.
IT IS EMPHASIZED THAT THE HYPOTHETICAL INVESTMENT RATES OF RETURN SHOWN ABOVE
ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF PAST OR
FUTURE INVESTMENT RATES OF RETURN. ACTUAL INVESTMENT RATES OF RETURN MAY BE
MORE OR LESS THAN THOSE SHOWN AND WILL DEPEND UPON A NUMBER OF FACTORS,
INCLUDING THE PREMIUM AND CASH VALUE ALLOCATIONS MADE BY AN OWNER AND THE
DIFFERENT RATES OF RETURN OF THE FUND PORTFOLIOS. THE DEATH BENEFIT, CASH
VALUE AND CASH SURRENDER VALUE FOR A POLICY WOULD BE DIFFERENT FROM THOSE
SHOWN IF THE ACTUAL INVESTMENT RATES OF RETURN AVERAGED 0%, 6% AND 12% OVER A
PERIOD OF YEARS, BUT FLUCTUATED ABOVE OR BELOW THOSE AVERAGES FOR INDIVIDUAL
POLICY YEARS OR IF ANY PREMIUMS WERE ALLOCATED OR CASH VALUE TRANSFERRED TO
THE FIXED ACCOUNT. NO REPRESENTATIONS CAN BE MADE BY METROPOLITAN LIFE OR THE
FUND THAT THESE HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR
OR SUSTAINED OVER ANY PERIOD OF TIME.
27
<PAGE>
FLEXIBLE PREMIUM MULTIFUNDED LIFE INSURANCE POLICY(1)
MALE ISSUE AGE 35
STANDARD NONSMOKER UNDERWRITING RISK SPECIFIED FACE AMOUNT: $100,000--DEATH
BENEFIT OPTION A CURRENT COST OF TERM INSURANCE CHARGES
<TABLE>
<CAPTION>
TOTAL DEATH
BENEFIT(2)
ASSUMING
TOTAL CASH HYPOTHETICAL
TOTAL CASH VALUE(2) SURRENDER VALUE(2) GROSS ANNUAL
PREMIUMS ASSUMING HYPOTHETICAL ASSUMING HYPOTHETICAL INVESTMENT
ACCUMULATED GROSS ANNUAL INVESTMENT GROSS ANNUAL INVESTMENT RATES OF
END OF AT 5% RATES OF RETURN OF RATES OF RETURN OF RETURN OF
POLICY INTEREST --------------------------------------------------------------
YEAR PER YEAR 0% 6% 12% 0% 6% 12% 0% 6% 12%
------ ----------- ------- ------- --------------- ------- ------------ ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1...................... $ $ $ $ $ $ $ $ $ $
2......................
3......................
4......................
5......................
6......................
7......................
8......................
9......................
10......................
15......................
20......................
25......................
40......................
45......................
50......................
</TABLE>
- -------
(1) Assumes annual planned premium payments of $ paid in full at beginning
of each Policy year. The values would vary from those shown if the amount
or frequency of payments varies.
(2) Assumes no policy loan or partial withdrawal has been made. Excessive
loans or withdrawals, adverse investment performance or insufficient
premium payments may cause the Policy to terminate because of insufficient
cash value.
IT IS EMPHASIZED THAT THE HYPOTHETICAL INVESTMENT RATES OF RETURN SHOWN ABOVE
ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF PAST OR
FUTURE INVESTMENT RATES OF RETURN. ACTUAL INVESTMENT RATES OF RETURN MAY BE
MORE OR LESS THAN THOSE SHOWN AND WILL DEPEND UPON A NUMBER OF FACTORS,
INCLUDING THE PREMIUM AND CASH VALUE ALLOCATIONS MADE BY AN OWNER AND THE
DIFFERENT RATES OF RETURN OF THE FUND PORTFOLIOS. THE DEATH BENEFIT, CASH
VALUE AND CASH SURRENDER VALUE FOR A POLICY WOULD BE DIFFERENT FROM THOSE
SHOWN IF THE ACTUAL INVESTMENT RATES OF RETURN AVERAGED 0%, 6% AND 12% OVER A
PERIOD OF YEARS, BUT FLUCTUATED ABOVE OR BELOW THOSE AVERAGES FOR INDIVIDUAL
POLICY YEARS OR IF ANY PREMIUMS WERE ALLOCATED OR CASH VALUE TRANSFERRED TO
THE FIXED ACCOUNT. NO REPRESENTATIONS CAN BE MADE BY METROPOLITAN LIFE OR THE
FUND THAT THESE HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR
OR SUSTAINED OVER ANY PERIOD OF TIME.
28
<PAGE>
FLEXIBLE PREMIUM MULTIFUNDED LIFE INSURANCE POLICY(1)
MALE ISSUE AGE 35
STANDARD NONSMOKER UNDERWRITING RISK SPECIFIED FACE AMOUNT: $100,000--DEATH
BENEFIT OPTION B CURRENT COST OF TERM INSURANCE CHARGES
<TABLE>
<CAPTION>
TOTAL CASH
TOTAL CASH VALUE(2) SURRENDER VALUE(2) TOTAL DEATH BENEFIT(2)
PREMIUMS ASSUMING HYPOTHETICAL ASSUMING HYPOTHETICAL ASSUMING HYPOTHETICAL
ACCUMULATED GROSS ANNUAL INVESTMENT GROSS ANNUAL INVESTMENT GROSS ANNUAL INVESTMENT
END OF AT 5% RATES OF RETURN OF RATES OF RETURN OF RATES OF RETURN OF
POLICY INTEREST ------------------------------------------------------------------------
YEAR PER YEAR 0% 6% 12% 0% 6% 12% 0% 6% 12%
------ ----------- ------- ------- --------------- ------- --------------- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1...................... $ $ $ $ $ $ $ $ $ $
2......................
3......................
4......................
5......................
6......................
7......................
8......................
9......................
10......................
15......................
20......................
25......................
40......................
45......................
50......................
</TABLE>
- -------
(1) Assumes annual planned premium payments of $ paid in full at beginning
of each Policy year. The values would vary from those shown if the amount
or frequency of payments varies.
(2) Assumes no policy loan or partial withdrawal has been made. Excessive
loans or withdrawals, adverse investment performance or insufficient
premium payments may cause the Policy to terminate because of insufficient
cash value.
IT IS EMPHASIZED THAT THE HYPOTHETICAL INVESTMENT RATES OF RETURN SHOWN ABOVE
ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF PAST OR
FUTURE INVESTMENT RATES OF RETURN. ACTUAL INVESTMENT RATES OF RETURN MAY BE
MORE OR LESS THAN THOSE SHOWN AND WILL DEPEND UPON A NUMBER OF FACTORS,
INCLUDING THE PREMIUM AND CASH VALUE ALLOCATIONS MADE BY AN OWNER AND THE
DIFFERENT RATES OF RETURN OF THE FUND PORTFOLIOS. THE DEATH BENEFIT, CASH
VALUE AND CASH SURRENDER VALUE FOR A POLICY WOULD BE DIFFERENT FROM THOSE
SHOWN IF THE ACTUAL INVESTMENT RATES OF RETURN AVERAGED 0%, 6% AND 12% OVER A
PERIOD OF YEARS, BUT FLUCTUATED ABOVE OR BELOW THOSE AVERAGES FOR INDIVIDUAL
POLICY YEARS OR IF ANY PREMIUMS WERE ALLOCATED OR CASH VALUE TRANSFERRED TO
THE FIXED ACCOUNT. NO REPRESENTATIONS CAN BE MADE BY METROPOLITAN LIFE OR THE
FUND THAT THESE HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR
OR SUSTAINED OVER ANY PERIOD OF TIME.
29
<PAGE>
FLEXIBLE PREMIUM MULTIFUNDED LIFE INSURANCE POLICY(1)
MALE ISSUE AGE 35
STANDARD NONSMOKER UNDERWRITING RISK SPECIFIED FACE AMOUNT: $100,000--DEATH
BENEFIT OPTION C CURRENT COST OF TERM INSURANCE CHARGES
<TABLE>
<CAPTION>
TOTAL CASH
TOTAL CASH VALUE(2) SURRENDER VALUE(2) TOTAL DEATH BENEFIT(2)
PREMIUMS ASSUMING HYPOTHETICAL ASSUMING HYPOTHETICAL ASSUMING HYPOTHETICAL
ACCUMULATED GROSS ANNUAL INVESTMENT GROSS ANNUAL INVESTMENT GROSS ANNUAL INVESTMENT
END OF AT 5% RATES OF RETURN OF RATES OF RETURN OF RATES OF RETURN OF
POLICY INTEREST ------------------------------------------------------------------------
YEAR PER YEAR 0% 6% 12% 0% 6% 12% 0% 6% 12%
------ ----------- ------- ------- --------------- ------- --------------- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1...................... $ $ $ $ $ $ $ $ $ $
2......................
3......................
4......................
5......................
6......................
7......................
8......................
9......................
10......................
15......................
20......................
25......................
40......................
45......................
50......................
</TABLE>
- -------
(1) Assumes annual planned premium payments of $ paid in full at beginning
of each Policy year. The values would vary from those shown if the amount
or frequency of payments varies.
(2) Assumes no policy loan or partial withdrawal has been made. Excessive
loans or withdrawals, adverse investment performance or insufficient
premium payments may cause the Policy to terminate because of insufficient
cash value.
IT IS EMPHASIZED THAT THE HYPOTHETICAL INVESTMENT RATES OF RETURN SHOWN ABOVE
ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF PAST OR
FUTURE INVESTMENT RATES OF RETURN. ACTUAL INVESTMENT RATES OF RETURN MAY BE
MORE OR LESS THAN THOSE SHOWN AND WILL DEPEND UPON A NUMBER OF FACTORS,
INCLUDING THE PREMIUM AND CASH VALUE ALLOCATIONS MADE BY AN OWNER AND THE
DIFFERENT RATES OF RETURN OF THE FUND PORTFOLIOS. THE DEATH BENEFIT, CASH
VALUE AND CASH SURRENDER VALUE FOR A POLICY WOULD BE DIFFERENT FROM THOSE
SHOWN IF THE ACTUAL INVESTMENT RATES OF RETURN AVERAGED 0%, 6% AND 12% OVER A
PERIOD OF YEARS, BUT FLUCTUATED ABOVE OR BELOW THOSE AVERAGES FOR INDIVIDUAL
POLICY YEARS OR IF ANY PREMIUMS WERE ALLOCATED OR CASH VALUE TRANSFERRED TO
THE FIXED ACCOUNT. NO REPRESENTATIONS CAN BE MADE BY METROPOLITAN LIFE OR THE
FUND THAT THESE HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR
OR SUSTAINED OVER ANY PERIOD OF TIME.
30
<PAGE>
...............................................................
POLICY RIGHTS
................................................................................
The description of rights under the Policy set forth below assumes that no
riders are in effect. See the Appendix to the Prospectus, for a discussion of
how these rights may be affected by certain riders under the Policy.
LOAN PRIVILEGES
Policy Loan. The Policy owner may borrow money from Metropolitan Life using
the Policy as the only security for the loan. The smallest amount the Policy
owner can borrow at any one time is $500. The maximum amount that may be bor-
rowed at any time is the loan value. The loan value equals the cash surrender
value less two monthly deductions or, if greater, 75% (90% for Policies issued
in Virginia or Maryland) of the cash surrender value (or, in Texas, the
Policy's cash surrender value less two monthly deductions or 100% of the cash
surrender value in the Fixed Account and 75% of the cash surrender value in the
Separate Account, if greater). For situations where a Policy loan may be
treated as a taxable distribution, see "Federal Tax Matters."
Allocation of Policy Loan. Metropolitan Life will allocate a Policy loan
first against the Fixed Account and then among the investment divisions of the
Separate Account on a Pro Rata Basis.
Interest. The interest charged on a Policy loan accrues daily. The interest
rate is a maximum fixed rate of 6% per year. The interest rate currently
charged for years one through ten of the Policy loan is 6%. Metropolitan Life
currently intends to reduce this rate to 4.6% after the tenth Policy year,
though this reduction is not guaranteed and has not taken effect under any Pol-
icy, because the Policies were first offered in 1998. Interest payments are due
at the end of each Policy year. If unpaid within 31 days after it is due, in-
terest will be treated as a new loan subject to the interest rates applicable
at that time and an amount equal to such interest due will be transferred from
the Fixed Account first and then on a Pro Rata Basis among the investment divi-
sions of the Separate Account to the Policy Loan Account.
Generally, pursuant to legislation enacted in 1997, no deduction is allowed
for interest on loans on life insurance policies, subject to certain exceptions
for key person insurance covering a limited number of individuals. The 1997
legislation also generally disallows in part an interest deduction to busi-
nesses which own cash value life insurance issued after June 8, 1997 for debt
unrelated to the contract, subject to certain exceptions for contracts covering
employees and certain other individuals. Counsel and other competent advisors
should be consulted with respect to the deductibility of Policy loan interest
for income tax purposes. (See "Federal Tax Matters.")
Effect of a Policy Loan. As of the Date of Receipt of the loan request, cash
value equal to the portion of the Policy loan allocated to the Fixed Account
and to each investment division will be transferred from the Fixed Account
and/or such investment divisions to a Policy Loan Account within the General
Account, reducing the Policy's cash value in the accounts from which the trans-
fer was made.
Cash value in the Policy Loan Account equal to indebtedness will be credited
with interest at a fixed guaranteed rate of 4%. NO ADDITIONAL INTEREST WILL BE
CREDITED TO THE CASH VALUE IN THE POLICY LOAN ACCOUNT, NOR WILL THE CASH VALUE
IN THE POLICY LOAN ACCOUNT PARTICIPATE IN ANY INVESTMENT EXPERIENCE APPLICABLE
TO THE SEPARATE ACCOUNT.
The Policy's cash value in the Policy Loan Account will be the outstanding
indebtedness on the valuation date plus any interest credited to the Policy
Loan Account which has not yet been allocated to the Fixed Account or the in-
vestment divisions of the Separate Account as of the Valuation Date. Interest
credited to amounts in the Policy Loan Account will be allocated at least once
a year among the Fixed Account and the investment divisions of the Separate Ac-
count according to the way in which monthly deductions are allocated.
Indebtedness. Indebtedness equals the outstanding Policy loan plus accrued
interest thereon. If, on a monthly anniversary, indebtedness exceeds the cash
value minus the monthly deduction, Metropolitan Life will notify the Policy
owner and any assignee of record. If a sufficient payment is not made to Metro-
politan Life within 61 days from the monthly anniversary, the Policy will ter-
minate without value. The Policy may, however, later be reinstated, subject to
certain conditions (see "Policy Termination and Reinstatement").
Repayment of Indebtedness. Indebtedness may be repaid any time before the Fi-
nal Date while the insured is living. The minimum repayment is the lesser of an
amount equal to the voluntary planned periodic premium or $50. If not repaid,
Metropolitan Life will deduct indebtedness from any amount payable under the
Policy. Payments made after obtaining the loan will be applied towards repaying
the loan first, then treated as a Policy premium. Even though such payments
will be applied towards repaying the loan, these payments will still in effect
"count" for purposes of maintaining any guaranteed minimum death benefit. As of
the Date of Receipt of the repayment, the Policy's cash value in the Policy
Loan Account securing indebtedness will be allocated to the Fixed Account and
the investment divisions of the Separate Account in the same proportion that
net premiums are being allocated to those accounts at the time of repayment.
31
<PAGE>
...............................................................
SURRENDER AND WITHDRAWAL PRIVILEGES
Subject to the limitations set forth below, at any time before the earlier
of the death of the insured and the Final Date, the Policy owner may totally
surrender the Policy. After the second Policy year, partial withdrawals may
also be made. These requests should be made in writing to the Designated Of-
fice. Metropolitan Life may require that these requests be made on forms pro-
vided for these purposes. The maximum amount available for surrenders or with-
drawal is the cash surrender value on the Date of Receipt of the request. Sur-
render charges may apply. See "Charges and Deductions--Surrender Charge" for a
discussion of surrender charges. For any tax consequences in connection with a
partial withdrawal or surrender, see "Federal Tax Matters".
Surrenders. The Policy owner may surrender the Policy for its cash surrender
value. If the Policy is being surrendered, Metropolitan Life may require that
the Policy itself be returned along with the request. A Policy owner may elect
to have the proceeds paid in a single sum or applied under an optional income
plan (see "Appendix to Prospectus"). If the insured dies after the surrender
of the Policy and payment to the Policy owner of the cash surrender value, but
before the end of the Policy month in which the surrender occurred, a death
benefit will be payable to the beneficiary in an amount equal to the differ-
ence between the Policy's death benefit and cash value, both computed as of
the surrender date.
Partial Withdrawals. The Policy owner may make a partial withdrawal from the
Policy's cash surrender value after the second Policy year. The minimum par-
tial withdrawal is $500. Surrender charges will be imposed on partial with-
drawals in each policy year on amounts over 10% of the Policy's cash surrender
value at the time of withdrawal. The amount withdrawn will be deducted from
the Policy's cash value as of the Date of Receipt. The amount will be deducted
from the Fixed Account and the investment divisions of the Separate Account in
the same way monthly deductions are allocated.
When death benefit Option A, or Option C on and after policy anniversary 65,
is in effect, any partial withdrawal will reduce the specified face amount,
and thus the death benefit, by the amount withdrawn plus the amount of any
surrender charge. When death benefit Option B, or Option C prior to policy an-
niversary 65, is in effect, the amount withdrawn will not reduce the specified
face amount. However, the death benefit will be reduced by the amount with-
drawn plus the amount of any surrender charge. If increases in the specified
face amount previously have occurred, a partial withdrawal when Death Benefit
Option A, or Option C on and after policy anniversary 65, is in effect will
reduce the specified face amount in the same manner as would a direct request
by the Policy owner to reduce the specified face amount (see "Policy Bene-
fits--Decreases"). A decrease in specified face amount may affect the Policy's
status as a modified endowment contract for tax purposes (see "Federal Tax
Matters").
A Policy owner will not be permitted to make any partial withdrawal that
would reduce the specified face amount of the Policy below the Minimum Initial
Specified Face Amount in the first five Policy years or one-half the Minimum
Initial Specified Face Amount thereafter (see "Policy Benefits--Decreases"),
or that would result in total premiums paid exceeding the then current maximum
premium limitation determined by Internal Revenue Service Code (see "Premi-
ums--Premium Limitations"). In no case will a partial withdrawal be permitted
that would reduce the specified face amount below $25,000. A partial with-
drawal will also not be permitted unless the resulting cash surrender value
would be sufficient to pay at least two monthly deductions. Any time a request
for a partial withdrawal is received that would reduce the specified face
amount below the minimum face amount, result in total premiums paid exceeding
maximum premium limitations, or reduce the cash surrender value below two
monthly deductions, Metropolitan Life will not implement the partial with-
drawal request, but will contact the Policy owner as to whether the request
should be withdrawn or reduced to a smaller amount or changed to a request for
the full cash surrender value.
EXCHANGE PRIVILEGE
During the first 24 Policy months following the issuance of the Policy, the
Policy owner may exercise the Policy exchange privilege, which results in the
transfer at any one time of the entire amount in the Separate Account to the
Fixed Account, and the allocation of all future net premiums to the Fixed Ac-
count. This will, in effect, serve as an exchange of the Policy for the equiv-
alent of a flexible premium fixed benefit life insurance policy. No charge
will be imposed on such transfer in exercising this exchange privilege. More-
over, the Policy owner may subsequently transfer amounts back to one or more
of the investment divisions of the Separate Account at any time, within the
limitations described in "Allocation of Premiums and Cash Value--Cash Value
Transfers". Similarly, during the first 24 months following an increase in the
specified face amount requested by the owner, the owner may request a one time
charge-free transfer of the Separate Account cash value attributable to the
increase to the Fixed Account, including a transfer in the amount of any pre-
mium payments that have been deemed attributable to the increase.
In those states which require it, the Policy owner may also, during the
first 24 Policy months following the issuance of the Policy, without charge,
on one occasion exchange any Policy still in force for a flexible premium
fixed benefit life insurance policy issued by Metropolitan
32
<PAGE>
...............................................................
Life. Upon such exchange, the Policy's cash value will be transferred to the
general account of Metropolitan Life.
THE FIXED ACCOUNT
................................................................................
A Policy owner may allocate net premiums and transfer cash value to the Fixed
Account, which is part of the General Account of Metropolitan Life. Because of
exemptive and exclusionary provisions, interests in the Fixed Account have not
been registered under the Securities Act of 1933 and neither the Fixed Account
nor the General Account has been registered as an investment company under the
1940 Act. Accordingly, neither the General Account, the Fixed Account nor any
interests therein are generally subject to the provisions of these Acts and
Metropolitan Life has been advised that the staff of the Securities and Ex-
change Commission has not reviewed the disclosures in this Prospectus relating
to the Fixed Account. Disclosures regarding the Fixed Account may, however, be
subject to certain generally applicable provisions of the Federal securities
laws relating to the accuracy and completeness of statements made in prospec-
tuses.
GENERAL DESCRIPTION
This Prospectus is generally intended to serve as a disclosure document only
for the aspects of the Policy involving the Separate Account and contains only
selected information regarding the Fixed Account. For complete details regard-
ing the Fixed Account, see the Policy itself.
The General Account consists of all assets owned by Metropolitan Life other
than those in the Separate Account and other legally-segregated separate ac-
counts. Subject to applicable law, Metropolitan Life has sole discretion over
the investment of the assets of the General Account, including those in the
Fixed Account. Unlike the assets of the Separate Account, the assets in the
Fixed Account, as a part of the General Account, are chargeable with liabili-
ties arising out of any other business of Metropolitan Life.
A Policy owner may elect to allocate net premiums to the Fixed Account or to
transfer cash value from the investment divisions of the Separate Account to
the Fixed Account. The allocation or transfer of funds to the Fixed Account
does not entitle a Policy owner to share in the investment experience of the
General Account. Instead, Metropolitan Life guarantees that cash value in the
Fixed Account will accrue interest at an effective annual rate of at least 3%,
independent of the actual investment experience of the General Account. Metro-
politan Life is not obligated to credit interest at any higher rate, although
Metropolitan Life may, in its sole discretion, do so.
FIXED ACCOUNT BENEFITS
The Policy owner may select death benefit Option A, B, or if the insured is
age 60 or less and if the Option is available in the state where the Policy is
issued, Option C. The Policy owner may change such option or the Policy's spec-
ified face amount, subject to satisfactory evidence of insurability where re-
quired and subject to all the conditions and limitations applicable to such
transactions generally (see "Policy Benefits--Death Benefits").
FIXED ACCOUNT CASH VALUE
Net premiums allocated to the Fixed Account are credited to the Policy. Met-
ropolitan Life guarantees that interest credited to each Policy owner's cash
value in the Fixed Account will not be less than an effective annual rate of at
least 3% per year. Metropolitan Life may declare any rate of interest in excess
of 3% at any time to be credited to amounts of cash value in the Fixed Account
subject to the following conditions: Metropolitan Life will not change the rate
of excess interest on any premiums paid during any month of the year before the
first day of the same month of the subsequent year; thereafter, Metropolitan
Life will not change the rate of excess interest for a period of twelve months
from the date declared. Metropolitan Life has also established multiple bands
of excess interest. This means that different rates of excess interest may ap-
ply to premium payments made in different months of the year and at the end of
each twelve-month period, and different rates of excess interest may apply to
cash value related to premiums received in a given month of each prior year. In
addition, different rates of excess interest may apply to transfers made into
the Fixed Account than apply to new premium payments for these purposes.
The guaranteed and excess interest are credited each Valuation Date. Once
credited, that interest will be guaranteed and become part of the Policy's cash
value in the Fixed Account. The monthly deduction will be charged against the
most recent premiums paid and interest credited thereto.
ANY INTEREST METROPOLITAN LIFE CREDITS ON THE POLICY'S CASH VALUE IN THE
FIXED ACCOUNT IN EXCESS OF THE GUARANTEED RATE OF 3% PER YEAR WILL BE DETER-
MINED IN THE SOLE DISCRETION OF METROPOLITAN LIFE. THE POLICY OWNER ASSUMES THE
RISK THAT INTEREST CREDITED TO AMOUNTS OF CASH VALUE IN THE FIXED ACCOUNT MAY
NOT EXCEED THE GUARANTEED MINIMUM RATE OF 3% PER YEAR. The cash value in the
Fixed Account will be calculated on each Valuation Date.
The Policy's cash value in the Fixed Account will reflect the amount and fre-
quency of premium payments
33
<PAGE>
...............................................................
allocated to the Fixed Account, the amount of interest credited to amounts in
the Fixed Account, any partial withdrawals, any transfers from or to the in-
vestment divisions of the Separate Account, any Policy indebtedness and any
charges imposed on amounts in the Fixed Account in connection with the Policy.
The portion of the monthly deduction attributable to the Fixed Account will
be determined as of the actual monthly anniversary, even if the monthly anni-
versary does not fall on a Valuation Date.
TRANSFERS, WITHDRAWALS, SURRENDERS, AND POLICY LOANS
Amounts in the Fixed Account are generally subject to the same rights and
limitations as are amounts allocated to the investment divisions of the Sepa-
rate Account with respect to transfers, withdrawals, surrenders and Policy
loans (see "Allocation of Premiums and Cash Value--Cash Value Transfers;" "Loan
Privileges," and "Surrender and Withdrawal Privileges").
Metropolitan Life also reserves the right to impose certain conditions on
transfers, withdrawals, surrenders, and Policy loans from the Fixed Account.
These conditions may include restricting transfers from the Fixed Account to
those made only on or about the Policy anniversary, and delaying transfers,
withdrawals, surrenders, and the payment of Policy loans from the Fixed Account
for up to 6 months. Metropolitan Life may also restrict additional transfers
from the Fixed Account during the twelve months following a transfer from the
Fixed Account. (see "Other Policy Provisions--Payment and Deferment"). Payments
to pay premiums on another policy with Metropolitan Life will not be delayed.
RIGHTS RESERVED BY METROPOLITAN LIFE
................................................................................
Metropolitan Life reserves the right to make certain changes if, in its judg-
ment, they would best serve the interests of the Policy owners or would be ap-
propriate in carrying out the purposes of the Policies. Any changes will be
made only to the extent and in the manner permitted by applicable laws. Also,
when required by law, Metropolitan Life will obtain Policy owner approval of
the changes and approval from any appropriate regulatory authority. Examples of
the changes Metropolitan Life may make include:
. To operate the Separate Account in any form permitted under the 1940 Act or
in any other form permitted by law.
. To take any action necessary to comply with or obtain and continue any ex-
emptions from the 1940 Act.
. To transfer any assets in any investment division to another investment di-
vision, or to one or more separate accounts, or to the Fixed Account; or to
add, combine or remove investment divisions in the Separate Account.
. To substitute, for the Fund shares held in any investment division, the
shares of another portfolio of the Fund or the shares of another investment
company or any other investment permitted by law.
. To change the way Metropolitan Life assesses charges, but without increas-
ing the aggregate amount charged to the Fixed Account and the Separate Ac-
count in connection with the Policies.
. To make any other necessary technical changes in the Policy in order to
conform with any action the above provisions permit Metropolitan Life to
take.
If any of these changes result in a material change in the underlying invest-
ments of an investment division to which the net premiums of a Policy are allo-
cated. Metropolitan Life will notify the Policy owner of such change, and the
owner may then make a new choice of investment divisions or the Fixed Account
without charge.
OTHER POLICY PROVISIONS
................................................................................
Owner. The owner of a Policy is the insured unless another owner has been
named in the application for the Policy. The owner is entitled to exercise all
rights under a Policy while the insured is alive, including the right to name a
new owner or a contingent owner who would become the Policy owner if the owner
should die before the insured dies.
Beneficiary. The beneficiary is the person or persons to whom the insurance
proceeds are payable upon the insured's death. The owner may name a contingent
beneficiary to become the beneficiary if all the beneficiaries die while the
insured is alive. If no beneficiary or contingent beneficiary is alive when the
insured dies, the owner (or the owner's estate) will be the beneficiary. While
the insured is alive, the owner may change any beneficiary or contingent bene-
ficiary.
If more than one beneficiary is alive when the insured dies, they will be
paid in equal shares, unless the owner has chosen otherwise.
Incontestability. Metropolitan Life will not contest the validity of a Policy
after it has been in force during the insured's lifetime for two years from the
Date of Policy (or date of reinstatement if a terminated Policy is reinstated)
except with respect to certain optional insurance benefits that may be added
subsequent to the Date of Policy. Metropolitan Life will not contest the valid-
ity of
34
<PAGE>
...............................................................
any increase in the death benefit after such increase has been in force during
the insured's lifetime for two years from its effective date.
Suicide. The insurance proceeds will not be paid if the insured commits sui-
cide, while sane or insane, within two years (one year in Colorado and North
Dakota) from the Date of Policy. Instead, Metropolitan Life will pay the bene-
ficiary an amount equal to all premiums paid for the Policy, without interest,
less any outstanding Policy loan and accrued loan interest and less any par-
tial cash withdrawal. If the insured commits suicide, while sane or insane,
more than two years after the Date of Policy but within two years (one year in
Colorado and North Dakota) from the effective date of any increase in the
death benefit, Metropolitan Life's liability with respect to such increase
will be limited to the cost thereof.
Age and Sex. If the insured's age or sex as stated in the application for a
Policy is not correct, benefits under a Policy will be adjusted to reflect the
correct age and sex.
Assignment. The owner may assign a Policy as collateral. All rights under
the Policy will be transferred to the extent of the assignee's interest. Met-
ropolitan Life is not bound by an assignment or release thereof, unless it is
in writing and is recorded at the Designated Office. Metropolitan Life is not
responsible for the validity of any assignment or release thereof. Any assign-
ment or other transfer of rights under a Policy may have adverse tax conse-
quences, causing the death benefit to become taxable to the beneficiary, or
causing all or part of any value assigned to be taxed as a distribution to the
owner. Therefore, it is very important to consult with a qualified tax adviser
before making any assignment.
Payment and Deferment. With respect to amounts in the investment divisions
of the Separate Account, payment of the death benefit, all or a portion of the
cash surrender value, free look proceeds or a loan will ordinarily be made
within seven days after the Date of Receipt of all documents required for such
payment. Metropolitan Life will pay interest on the amount of death benefit at
a rate which is currently 6% per year (or such higher rate as may be required
by state law) from the date of death until the date of payment of the death
benefit.
However, Metropolitan Life may defer the determination, application or pay-
ment of any such amount or any transfer of cash value to the Separate Account
for any period during which the New York Stock Exchange is closed (other than
customary weekend and holiday closings), for any period during which any emer-
gency exists as a result of which it is not reasonably practicable for Metro-
politan Life to determine the investment experi-ence for a Policy or for such
other periods as the Securities and Exchange Commission may by order permit
for the protection of Policy owners provided the delay is permitted under New
York State Insurance Law and regulations. Metropolitan Life will not defer a
loan used to pay premiums on other policies issued by it.
As with traditional life insurance, Metropolitan Life can delay payment of
the entire insurance proceeds or other Policy benefits if entitlement to pay-
ment is being questioned or is uncertain. Metropolitan Life may also defer
payment of any amounts attributable to a check for a reasonable time (not more
than 15 days) to allow the check to clear.
Dividends. The Policies are nonparticipating. This means that they are not
eligible for dividends, and they do not participate in any distribution of
Metropolitan Life's surplus.
The description throughout this Prospectus of the features of the Policies
is subject to the specific terms of the Policies.
SALES AND ADMINISTRATION OF THE POLICIES
...............................................................................
Metropolitan Life performs the sales and administrative services relating to
the Policies. The offices of Metropolitan Life which may administer the Poli-
cies are located in: Aurora, Illinois; Johnstown, Pennsylvania; Pearl River,
New York; Princeton, New Jersey; San Ramon, California; Tampa, Florida; Tulsa,
Oklahoma; and Warwick, Rhode Island. Each Policy owner will be notified which
office will be the Designated Office for servicing the Policy. Metropolitan
Life may name different Designated Offices for different transactions.
Metropolitan Life acts as the principal underwriter (distributor) of the
Policies as defined in the 1940 Act (see "Distribution of the Policies," be-
low). In addition to selling insurance and annuities, Metropolitan Life also
serves as investment adviser to certain other advisory clients, and is also
principal underwriter for Metropolitan Tower Separate Accounts One and Two of
Metropolitan Tower Life Insurance Company, a wholly-owned subsidiary of Metro-
politan Life, and Metropolitan Life Separate Account E of Metropolitan Life,
each of which is registered as a unit investment trust under the 1940 Act. Fi-
nally, Metropolitan Life acts as principal underwriter for other forms of
flexible premium variable life insurance policies, premiums for which may also
be allocated to the Separate Account.
Certain computer systems Metropolitan Life uses to process Policy transac-
tions and valuations need to be adjusted to be able to continue to administer
Policies after Year 2000. As is the case with most system conver-
35
<PAGE>
...............................................................
sion projects, risks and uncertainties exist, due in part to reliance on third
party vendors, and a project could be delayed. Metropolitan Life is, however,
devoting all resources necessary to make these systems modifications and ex-
pects that the necessary changes will be completed on time and in a way that
will result in no disruption to Policy servicing operations.
Bonding. The directors, officers and employees of Metropolitan Life are
bonded in the amount of $50,000,000, subject to a $5,000,000 deductible.
DISTRIBUTION OF THE POLICIES
................................................................................
The Policies will be sold by individuals who are licensed life insurance
sales representatives and registered representatives of Metropolitan Life, the
principal underwriter of the Policies. Metropolitan Life is registered with the
Securities and Exchange Commission under the Securities Exchange Act of 1934 as
a broker-dealer and is a member of the National Association of Securities Deal-
ers, Inc. The Policies may in the future be sold through other registered bro-
ker-dealers, including MetLife Securities, Inc., a wholly owned broker-dealer
subsidiary of Metropolitan Life. Maximum commissions payable during the first
Policy year to writing representatives employed by Metropolitan Life will be
50% of the lesser of (A) actual premiums paid in the first year, (B) the ini-
tial voluntary planned periodic premium for the first year and (C) the annual
premium necessary to keep the longest duration of guaranteed minimum death ben-
efit available under the Policy in effect for a like Policy using Death Benefit
Option A and preferred rating class for standard risks (for other risks, the
actual rating class) for a nonsmoker. We will also pay a 50% commission on the
lesser of (A) the amount by which any premiums paid in the first 12 months fol-
lowing an application to increase the specified face amount exceed the cumula-
tive amount of premiums on which a 50% commission has previously been paid, and
(B) the portion of (C) above computed using the difference between the old and
new specified face amounts using the age and rating information of the insured
at the time of the increase. For premiums not subject to the first year rates
set forth above, the commission is 3% in Policy years 1-4 and zero thereafter.
Maximum commissions payable under brokerage arrangements do not exceed these
amounts.
A service fee is paid to the agent servicing the policy (which may or may not
be the writing representative). In Policy years 2 through 10, the service fee
is 2% of premiums paid. In Policy years 11 and later, the service fee is 1% of
premiums paid.
When a sale is made by a Metropolitan Life employee, the sales manager gener-
ally receives a commission override based on many factors, including the writ-
ing representative's commissions and the overall commissions from all writing
representatives under the sales manager's supervision.
The commissions are paid by Metropolitan Life. They do not result in any
charges against the Policy in addition to those set forth under "Charges and
Deductions". No commissions were paid in 1997, 1996 and 1995 because this prod-
uct first became available for sale on May 1, 1998.
FEDERAL TAX MATTERS
................................................................................
The following description is a brief summary of some of the tax rules, pri-
marily related to federal income and estate taxes, which in the opinion of Met-
ropolitan Life are currently in effect.
TAXATION OF THE POLICY
The Policy receives the same federal income and estate tax treatment as fixed
benefit life insurance. The death benefit payable under any death benefit op-
tion in the Policy is generally excludable from the gross income of the benefi-
ciary under Section 101 of the Internal Revenue Code ("Code") and the Policy
owner is not deemed to be in constructive receipt of the cash values under the
Policy until actual withdrawal or surrender or upon the Final Date.
Under existing tax law, unless a Policy is a modified endowment contract as
discussed below, a Policy owner generally will be taxed on cash value withdrawn
from the Policy and cash value received upon surrender of the Policy or upon
the Final Date. Under most circumstances, unless the distribution occurs during
the first 15 Policy years, only the amount withdrawn, received upon surrender
or distributed at the Final Date of a Policy that exceeds the premiums paid
less previous non-taxable withdrawals will be treated as ordinary income. Dur-
ing the first 15 Policy years, as a result of a decrease in benefits, cash dis-
tributions from a Policy, made as a result of a Policy change that reduces
death benefits or other benefits under a Policy, will be taxable to the Policy
owner, under a complex formula, to the extent that cash value exceeds the Own-
er's remaining investment in the Policy.
Notwithstanding the foregoing, if a Policy is part of a collateral assignment
equity split-dollar arrangement with an employer, any increase in cash value
may be taxable annually. This type of arrangement involves premium advances by
an employer which are secured through a collateral assignment of the Policy. An
individ ual should consult with and rely on the advice of a tax advisor with
respect to any type of split-dollar arrangement involving the Policy.
36
<PAGE>
...............................................................
The United States Treasury Department has adopted regulations which set di-
versification rules for the investments underlying the Policies, in order for
the Policies to be treated as life insurance. Metropolitan Life believes that
these diversification standards will be satisfied. There is a provision in the
regulations which allows for the correction of an inadvertent failure to di-
versify. Failure to comply with the rules found in the regulations would re-
sult in immediate taxation to Policy owners of all positive investment experi-
ence credited to a Policy.
There is a possibility that regulations may be proposed or that a control-
ling ruling may be issued in the future describing the extent to which Policy
owner control over allocation of cash value may cause Policy owners to be
treated as the owners of Separate Account assets for tax purposes. Metropoli-
tan Life reserves the right to amend the Policies in any way necessary to
avoid any such result. As of the date of this Prospectus, no such regulations
or ruling have been issued, although the Treasury Department has informally
indicated that any such regulations or ruling could limit the number of in-
vestment funds or the frequency of transfers among such funds. It is not known
whether any such regulations or ruling would have a retroactive effect.
Metropolitan Life also believes that loans received under the Policy will be
treated as indebtedness of an owner for federal tax purposes, and, unless the
Policy is or becomes a modified endowment contract as described below or ter-
minates, that no part of any loan received under a Policy will constitute in-
come to the owner.
Generally, interest on Policy loans is not deductible. Legislation in 1997
and effective for policies issued after June 8, 1997 generally disallows, in
part, interest deductions to businesses which own cash value life insurance
for debt unrelated to the policy. There are exceptions for policies which in-
sure employees and certain other individuals. The rules are complex. A Policy
owner should consult a tax advisor to determine how the rules governing the
deductibility of interest would apply in the Policy owner's situation. A total
surrender, cancellation of the Policy or distribution at the Final Date of a
Policy where there is an outstanding loan may have tax consequences depending
on the amount of gain in the Policy.
Special rules govern the federal income tax treatment of pre-death withdraw-
als from a class of life insurance contracts referred to as modified endowment
contracts. Unlike under other life insurance contracts, amounts received
before death from a modified endow ment contract, including policy loans, are
treated first as income (to the extent of gain) and then as recovered invest-
ment. For purposes of determining the amount in-cludible in income, all modi-
fied endowment contracts issued by the same company (or affiliate) to the same
policyholder during any calendar year will be treated as one modified endow-
ment contract. Finally, an additional 10% income tax is generally imposed on
the taxable portion of pre-death amounts received before age 59 1/2.
In general, a modified endowment contract is a life insurance contract en-
tered into or materially changed after June 20, 1988 that fails to meet a "7-
pay test". Under the 7-pay test, if the amount of premiums paid under the life
insurance contract at any time during the first 7 policy years exceeds the sum
of the net level premiums which would have been paid if the contract provided
for paid-up future benefits after the payment of 7 level annual payments, the
contract is a modified endowment contract. A policy may have to be reviewed
under the 7-pay test even after the first seven policy years in the case of
certain events such as a material modification of the policy as discussed be-
low. If there is a reduction in benefits under the contract during any 7-pay
testing period, the 7-pay test is applied using the reduced benefits level.
Any distribution made within two Policy years before a policy fails the 7-
pay test may be treated as made in anticipation of such failure. Whether or
not a particular Policy meets these definitional requirements is dependent on
the date the contract was entered into, premium payments made and the periodic
premium payments to be made, the level of death benefits, any changes in the
level of death benefits, the extent of any prior cash withdrawals, and other
factors. Generally, a life insurance policy which is received in exchange for
a modified endowment contract will also be considered a modified endowment
contract.
A Policy should be reviewed upon issuance, upon making a cash withdrawal,
upon making a change in future benefits and upon making a material modifica-
tion to the Policy to determine to what extent, if any, these tax rules apply.
A material modification to a Policy includes, but is not limited to, any in-
crease in the future benefits provided under the Policy. However, in general,
increases that are attributable to the payment of premiums necessary to fund
the lowest death benefit payable in the first 7 Policy years will not be con-
sidered material modifications. The annual statement sent to each Policy owner
will include information regarding the modified endowment contract status of a
Policy (see "Premiums--Premium Limitations").
Counsel and other competent advisors should be consulted to determine how
these rules apply to an individual situation and before making unplanned pre-
mium payments, increasing or decreasing the specified face amount, or adding
or removing a rider.
37
<PAGE>
...............................................................
Congress may, in the future, consider other legislation that, if enacted,
could adversely affect the tax treatment of life insurance policies. In addi-
tion, the Treasury Department may by regulation or interpretation modify the
above described tax effects. Any legislative or administrative action could be
applied retroactively.
The death benefit payable under the Policy is includable in the insured's
gross estate for federal estate tax purposes if the death benefit is paid to
the insured's estate or if the death benefit is paid to a beneficiary other
than the estate and the insured either possessed incidents of ownership in the
Policy at the time of death or transferred incidents of ownership in the Policy
to another person within three years of death.
Whether or not any federal estate tax is payable with respect to the death
benefit of the Policy which is included in the insured's gross estate depends
on a variety of factors including the following. A smaller size estate may be
exempt from federal estate tax because of an estate tax credit which generally
is equivalent to an exemption of $625,000 in 1998, gradually increasing to $1
million in 2006 and thereafter. In addition, a death benefit paid to a surviv-
ing spouse may not be taxable because of a 100% estate tax marital deduction.
Furthermore, a death benefit paid to a tax-exempt charity may not be taxable
because of the allowance of an estate tax charitable deduction.
If the owner of the Policy is not the insured, and the owner dies before the
insured, the value of the Policy, as determined under Internal Revenue Service
regulations, is includable in the federal gross estate of the owner for federal
estate tax purposes. Whether a federal estate tax is payable depends on a vari-
ety of factors, including those listed in the preceding paragraph.
State and local income, estate, inheritance and other tax consequences of
ownership or receipt of Policy proceeds depend on the circumstances of each in-
sured, owner or beneficiary.
The foregoing summary does not purport to be complete or to cover all situa-
tions. Counsel and other competent advisors should be consulted for more com-
plete information.
TAXATION OF METROPOLITAN LIFE
Metropolitan Life does not initially expect to incur any federal income tax
upon the earnings or the realized capital gains attributable to the Separate
Account. Based upon these expectations, no charge is currently being made
against the Separate Account for federal income taxes, with respect to earnings
or capital gains, which may be attributable to the Separate Account. If, howev-
er, Metropolitan Life determines that it may incur such taxes, it may assess a
charge against or make provisions in the Separate Account for those taxes.
There is a 1.25% charge imposed on premiums paid for the purpose of recovering
the federal income taxes imposed on Metropolitan Life based on the amount of
premiums received in connection with the Policies.
Under present laws, Metropolitan Life may incur state and local taxes (in ad-
dition to premium taxes) in several states. At present, these taxes are not
significant. If they increase, however, Metropolitan Life may decide to make
charges for such taxes against or provisions for such taxes in the Separate Ac-
count. However, there is a 2% charge imposed on premiums paid for state premium
taxes.
38
<PAGE>
MANAGEMENT
The present directors and the senior officers and secretary of Metropolitan
Life are listed below, together with certain information concerning them:
DIRECTORS, OFFICERS-DIRECTORS
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION & POSITIONS AND OFFICES
NAME BUSINESS ADDRESS WITH METROPOLITAN LIFE
---- ---------------------- ----------------------
<S> <C> <C>
Curtis H. Barnette...... Chairman and Chief Executive Officer, Director
Bethlehem Steel Corp.,
1170 Eighth Avenue,
Martin Tower 2118,
Bethlehem, PA 18016-7699.
Robert H. Benmosche..... President and Chief Operating Officer, President, Chief Operating
Metropolitan Life Insurance Company, Officer and Director
One Madison Avenue,
New York, N.Y. 10010.
Gerald Clark............ Senior Executive Vice-President Senior Executive Vice-
and Chief Investment Officer, President and Chief
Metropolitan Life Insurance Company, Investment Officer,
One Madison Avenue, Director
New York, N.Y. 10010.
Joan Ganz Cooney........ Chairman, Executive Committee, Director
Children's Television Workshop,
One Lincoln Plaza,
New York, NY 10023.
Burton A. Dole.......... Chairman of the Board, Director
Nellcor Puritan Bennett,
2200 Faraday Avenue,
Carlsbad, CA 92008-7208.
James R. Houghton....... Retired Chairman of the Board and Director
Chief Executive Officer,
Corning Incorporated,
80 East Market Street,
2nd Floor,
Corning, NY 14830.
Harry P. Kamen.......... Chairman and Chief Executive Officer, Chairman, Chief Executive
Metropolitan Life Insurance Company, Officer and Director
One Madison Avenue,
New York, NY 10010.
Helene L. Kaplan........ Of Counsel, Skadden, Arps, Slate, Director
Meagher & Flom,
919 Third Avenue,
New York, NY 10022.
Charles M. Leighton..... Chairman and Chief Executive Officer, Director
CML Group, Inc.,
524 Main Street,
Acton, MA 01720.
Allen E. Murray......... Retired Chairman of the Board Director
and Chief Executive Officer,
Mobil Corporation,
375 Park Avenue, Suite 2901,
New York, NY 10163.
</TABLE>
39
<PAGE>
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION & POSITIONS AND OFFICES
NAME BUSINESS ADDRESS WITH METROPOLITAN LIFE
---- ---------------------- ----------------------
<S> <C> <C>
Stewart Nagler.......... Senior Executive Vice-President Senior Executive Vice-
and Chief Financial Officer, President, Chief Financial
Metropolitan Life Insurance Company Officer and Director
One Madison Avenue
New York, NY 10010
John J. Phelan, Jr. .... Retired Chairman and Chief Executive Director
Officer, New York Stock Exchange,
Inc.,
P.O. Box 312,
Mill Neck, NY 11765.
Hugh B. Price........... President and Chief Executor Officer, Director
National Urban League, Inc.,
12 Wall Street,
New York, NY 10005.
Robert G. Schwartz...... Retired Chairman of the Board, Director
President and Chief Executive Officer,
Metropolitan Life Insurance Company,
200 Park Avenue, Suite 5700,
New York, NY 10166.
Ruth J. Simmons, Ph.D. . President, Director
Smith College,
College Hall 20,
Northhampton, MA 01063.
William S. Sneath....... Retired Chairman of the Board, Director
Union Carbide Corporation,
41 Leeward Lane,
Riverside, CT 06878.
William C. Steere, Jr. . Chairman of the Board and Chief Director
Executive Officer,
Pfizer, Inc.,
235 East 42nd Street,
New York, NY 10017.
</TABLE>
40
<PAGE>
OFFICERS*
<TABLE>
<CAPTION>
NAME OF OFFICER POSITION WITH METROPOLITAN LIFE
--------------- -------------------------------
<S> <C>
Harry P. Kamen.......... Chairman and Chief Executive Officer
Robert H. Benmosche..... President and Chief Operating Officer
Gary A. Beller.......... Senior Executive Vice-President and General Counsel
Gerald Clark............ Senior Executive Vice-President and Chief Investment Officer
Stewart G. Nagler....... Senior Executive Vice-President and Chief Financial Officer
Catherine A. Rein....... Senior Executive Vice-President
William J. Toppeta...... Senior Executive Vice-President
C. Robert Henrikson..... Senior Executive Vice-President
Jeffrey J. Hodgman...... Executive Vice-President
Terence I. Lennon....... Executive Vice-President
David A. Levene......... Executive Vice-President
John D. Moynahan, Jr. .. Executive Vice-President
John H. Tweedie......... Executive Vice-President
Judy E. Weiss........... Executive Vice-President and Chief Actuary
William Livesey......... Senior Vice-President
Alexander D. Brunini.... Senior Vice President
Richard M. Blackwell.... Senior Vice-President
James B. Digney......... Senior Vice-President
William T. Friedewald... Senior Vice-President
Ira Friedman............ Senior Vice-President
Anne E. Hayden.......... Senior Vice-President
Sybil C. Jacobsen....... Senior Vice-President
Joseph W. Jordan........ Senior Vice-President
Kernan F. King.......... Senior Vice President
Nicholas D. Latrenta.... Senior Vice-President
Leland C. Launer, Jr. .. Senior Vice-President
Gary E. Lineberry....... Senior Vice-President
James L. Lipscomb....... Senior Vice-President
William Livesey......... Senior Vice-President
James M. Logan.......... Senior Vice-President
Eugene Marks, Jr........ Senior Vice President
Dominick A. Prezzano.... Senior Vice-President
Joseph A. Reali......... Senior Vice-President
Vincent P. Reusing...... Senior Vice-President
Felix Schirripa......... Senior Vice-President
Robert E. Sollmann, Jr.. Senior Vice-President
Thomas L. Stapleton..... Senior Vice-President and Tax Director
James F. Stenson........ Senior Vice-President
Stanley J. Talbi........ Senior Vice-President
Richard R. Tartre....... Senior Vice-President
James A. Valentino...... Senior Vice-President
William J. Wheeler...... Senior Vice-President and Treasurer
Anthony J. Williamson... Senior Vice-President
Louis Ragusa............ Vice-President and Secretary
</TABLE>
- -------
* The principal occupation of each officer, except for the following officers,
during the last five years has been as an officer of Metropolitan Life or an
affiliate thereof. Gary A. Beller has been an officer of Metropolitan Life
since November, 1994; prior thereto, he was a Consultant and Executive Vice-
President and General Counsel of the American Express Company. Robert H.
Benmosche has been an officer of Metropolitan Life since September, 1995;
prior thereto, he was an Executive Vice-President of Paine Webber. Terence
I. Lennon has been an officer of Metropolitan Life since March, 1994; prior
thereto, he was Assistant Deputy Superintendent and Chief Examiner of the
New York State Department of Insurance. Richard R. Tartre has been an
officer of Metropolitan Life since January 13, 1997, prior thereto he was
President and CEO of Astra Management Corp. William J. Wheeler became an
officer of Metropolitan Life since October 13, 1997; prior thereto he was
Senior Vice-President, Investment Banking of Donaldson, Lufkin and Jenrette.
The business address of each officer is 1 Madison Avenue, New York, New York
10010.
41
<PAGE>
...............................................................
VOTING RIGHTS
................................................................................
RIGHT TO INSTRUCT VOTING OF FUND SHARES
In accordance with its view of present applicable law, Metropolitan Life will
vote the shares of each of the portfolios of the Fund which are deemed attrib-
utable to Policies at regular and special meetings of the shareholders of the
Fund based on instructions received from persons having the voting interest in
corresponding investment divisions of the Separate Account. However, if the
1940 Act or any rules thereunder should be amended or if the present interpre-
tation thereof should change, and as a result Metropolitan Life determines that
it is permitted to vote such shares of the Fund in its own right, it may elect
to do so.
Accordingly, the Policy owner will have a voting interest under a Policy. The
number of shares held in each Separate Account investment division deemed at-
tributable to each owner is determined by dividing a Policy's cash value in
that division, if any, by the net asset value of one share in the corresponding
Fund portfolio in which the assets in that Separate Account investment division
are invested. Fractional votes will be counted. The number of shares concerning
which a Policy owner has the right to give instructions will be determined as
of the record date for the meeting.
Fund shares held in each registered separate account of Metropolitan Life or
any affiliate that are or are not attributable to life insurance policies (in-
cluding the Policies) or annuity contracts and for which no timely instructions
are received will be voted in the same proportion as the shares for which vot-
ing instructions are received by that separate account. Fund shares held in the
general accounts or unregistered separate accounts of Metropolitan Life or its
affiliates will be voted in the same proportion as the aggregate of (i) the
shares for which voting instructions are received and (ii) the shares that are
voted in proportion to such voting instructions. However, if Metropolitan Life
or an affiliate determines that it is permitted to vote any such shares of the
Fund in its own right, it may elect to do so subject to the then current inter-
pretation of the 1940 Act or any rules thereunder.
The Policy owners may give instructions regarding, among other things, the
election of the Board of Directors of the Fund, ratification of the selection
of the Fund's independent auditors, and the approval of the Fund's investment
manager and sub-investment manager.
Each Policy owner having a voting interest will be sent voting instruction
soliciting material and a form for giving voting instructions to Metropolitan
Life.
DISREGARD OF VOTING INSTRUCTIONS
Notwithstanding the foregoing, Metropolitan Life may vote Fund shares con-
trary to owner voting instructions in certain limited circumstances specified
by the Commission. In the event that Metropolitan Life does disregard voting
instructions, a summary of the action and the reasons for such action will be
included in the next semiannual report to Policy owners.
REPORTS
................................................................................
Policy owners will receive promptly statements of significant transactions
such as change in specified face amount, change in death benefit option,
changes in guarantees, transfers among investment divisions, partial withdraw-
als, increases in loan principal by the Policy owner, loan repayments, termina-
tion for any reason, reinstatement and premium payments. Transactions pursuant
to automated investment strategies (see "Payment and Allocation of Premiums,")
may be confirmed quarterly. Policy owners whose premiums are automatically re-
mitted under a check-o-matic allotment deduction or certain payroll deduction
plans do not receive individual confirmations of premium payments from Metro-
politan Life apart from that provided by their bank or employer. An annual
statement will also be sent to the Policy owner within thirty days after a Pol-
icy year summarizing all of the above transactions and deductions of charges
occurring during that Policy year and setting forth the status of the death
benefit, cash and cash surrender values, amounts in the investment divisions
and Fixed Account, any policy loan and unpaid loan interest added to loan prin-
cipal. The annual statement will also discuss the modified endowment contract
status of a Policy (see "Premiums--Premium Limitations"). In addition, an owner
will be sent semiannual reports containing financial statements for the Fund,
as required by the 1940 Act.
STATE REGULATION
................................................................................
Metropolitan Life is subject to regulation and supervision by the Insurance
Department of the State of New York, which periodically examines its affairs.
It is also subject to the insurance laws and regulations of all jurisdictions
where it is authorized to do business. Where required, a copy of the form of
Policy has been filed with, and approved by, insurance officials in each juris-
diction where the Policies are sold. The Policy and/or the guaranteed minimum
death benefit may not be available in all jurisdictions. Individuals should
consult with their Metropolitan Life sales representatives to determine if the
Policy is available in their jurisdictions.
42
<PAGE>
...............................................................
Metropolitan Life is required to submit annual statements of its operations,
including financial statements, to the insurance departments of the various
jurisdictions in which it does business, for the purposes of determining sol-
vency and compliance with local insurance laws and regulations. Such state-
ments are available for public inspection at state insurance department of-
fices.
REGISTRATION STATEMENT
...............................................................................
A registration statement under the Securities Act of 1933 has been filed
with the Securities and Exchange Commission relating to the offering described
in this Prospectus. This Prospectus does not contain all the information set
forth in the registration statement and amendments thereto and the exhibits
filed as a part thereof, to all of which reference is hereby made for addi-
tional information concerning the Separate Account, Metropolitan Life and the
Policies. The additional information may be obtained at the Commission's main
office in Washington, D.C., upon payment of the prescribed fees.
LEGAL MATTERS
...............................................................................
The legality of the Policies described in this Prospectus has been passed
upon by Christopher P. Nicholas, Associate General Counsel of Metropolitan
Life. Messrs. Freedman, Levy, Kroll & Simonds, Washington, D.C., have advised
Metropolitan Life on certain matters relating to the federal securities laws.
EXPERTS
...............................................................................
The financial statements included in this Prospectus have been audited by
, independent auditors, as stated in their reports appearing herein,
and are included in reliance upon the reports of such firm given upon their
authority as experts in accounting and auditing.
Actuarial matters included in this Prospectus have been examined by Marian
Zelden, FSA, MAAA, VicePresident and Actuary of Metropolitan Life, as stated
in her opinion filed as an exhibit to the registration statement.
FINANCIAL STATEMENTS
...............................................................................
The financial statements of Metropolitan Life included in this Prospectus
should be considered only as bearing upon the ability of Metropolitan Life to
meet its obligations under the Policies.
43
<PAGE>
APPENDIX TO PROSPECTUS
OPTIONAL INCOME PLANS
The insurance proceeds when the insured dies, the proceeds payable on the
Final Date, or the cash surrender value payable on full surrender of a Policy,
instead of being paid in one lump sum, may be applied under one or more of the
following income plans. Values under the income plans do not depend upon the
investment experience of a separate account. The selection of an income plan
can significantly affect the federal income tax consequences associated with
the Policy proceeds. Owners and beneficiaries should consult with qualified
tax advisers in this regard.
OPTION 1. Interest income
The amount applied will earn interest which will be paid monthly.
Withdrawals of at least $500 each may be made at any time by written request.
OPTION 2. Installment Income for a Stated Period
Monthly installment payments will be made so that the amount applied, with
interest, will be paid over the period chosen (from 1 to 30 years).
OPTION 2A. Installment Income of a Stated Amount
Monthly installment payments of a chosen amount will be made until the
entire amount applied, with interest, is paid.
OPTION 3. Single Life Income--Guaranteed Payment Period
Monthly payments will be made during the lifetime of the payee with a chosen
guaranteed payment period of 10, 15 or 20 years.
OPTION 3A. Single Life Income--Guaranteed Return
Monthly payments will be made during the lifetime of the payee. If the payee
dies before the total amount applied under this plan has been paid, the
remainder will be paid in one sum as a death benefit.
OPTION 4. Joint and Survivor Life Income
Monthly payments will be made jointly to two persons during their lifetime
and will continue during the remaining lifetime of the survivor. A total
payment period of 10 years is guaranteed.
Other Frequencies and Plans. Instead of monthly payments, the owner may
elect to have payments made quarterly, semiannually or annually. Other income
plans may be arranged with Metropolitan Life's approval.
Choice of Income Plans. See "Policy Benefits--Optional Income Plans" and
"Policy Rights--Surrenders" regarding how optional income plans may be chosen.
When an income plan starts, a separate contract will be issued describing the
terms of the plan. Specimen contracts may be obtained from Metropolitan Life
sales representatives, and reference should be made to these forms for further
details.
Limitations. If the payee is not a natural person, the choice of an income
plan will be subject to Metropolitan Life's approval. A collateral assignment
will modify a prior choice of income plan. The amount due the assignee will be
payable in one sum and the balance will be applied under the income plan. A
choice of an income plan will not become effective unless each payment under
the plan would be at least $50. Income plan payments may not be assigned and,
to the extent permitted by law, will not be subject to the claims of
creditors.
Income Plan Rates. Amounts applied under the interest income and installment
income plans will earn interest at a rate set from time to time by
Metropolitan Life but never less than 3% per year. Life income payments will
be based on a rate set by Metropolitan Life and in effect on the date the
amount to be applied becomes payable, but never less than the minimum payments
guaranteed in the Policy. Such minimum guaranteed payments are based on
certain assumed mortality rates and an interest rate of 3%.
44
<PAGE>
OPTIONAL INSURANCE BENEFITS
Optional insurance benefit riders may be attached to a Policy, subject to
certain insurance underwriting requirements and the payment of additional
premiums. These riders are described in general terms below. Limitations and
conditions are contained in the riders, and the description below is subject
to the specific terms of the riders. A prospective purchaser may obtain a
specimen Policy with riders from a Metropolitan Life sales representative. The
duration, but not the amount, of rider benefits may depend on the investment
experience of a separate account.
Disability Waiver of Premium Benefit. This rider pays the premium during the
total disability of the insured, at a level selected by the Policy owner, if
the insured is totally and continuously disabled (as defined in the rider) for
at least six months beginning prior to Age 60. The rider is intended to
benefit the Policy owner who seeks to build cash value or maintain a
guaranteed minimum death benefit during a period of disability. During
disability, all charges and deductions will continue to be made. In order to
qualify for this rider, the Policy owner must maintain premium payments, prior
to the period of disability, at a level at least equal to the premium level to
be paid under the rider. If the Policy owner does not maintain this premium
level, the benefit provided will be the same as that provided under the
Disability Waiver of Monthly Deduction Benefit rider, unless sufficient
payment is received within 61 days from the monthly anniversary that the
premium requirements to maintain the rider have not been met. This benefit
change may result in a change to the monthly costs for this rider. Notably, in
cases where the premium paid by the rider is close to the minimum initial
premium or is less than the monthly deductions, the monthly cost may increase.
The policy owner can terminate the rider to avoid these higher costs. However,
the policy owner would then lose the protection provided by the rider. If the
total disability continues without interruption to policy anniversary 65, it
will be deemed permanent and benefits will continue. If there is a specified
face amount increase or decrease, or change in death benefit option, the
Policy owner can modify the selected premium level. Because the Policy is
variable in nature, the selected premium level may be insufficient to fund the
Policy to the Final Date. In such a case, unless a Guaranteed Minimum Death
Benefit is in effect, the grace period and termination provisions would apply.
Disability Waiver of Monthly Deduction Benefit. This rider waives the entire
monthly deduction, except any applicable mortality and expense risk charge,
during the total disability of the insured if the insured is totally and
continuously disabled (as defined in the rider) for at least six months
beginning prior to age 60. If the total disability continues without
interruption to policy anniversary 65, it will be deemed permanent and all
further monthly deductions will be waived as they fall due. If there has been
an increase in the death benefit resulting from a request by the Policy owner,
and the Policy owner at the time of the increase did not request or did not
qualify for this rider with respect to such increase, monthly deductions for
charges related to such increase will continue to be made against the cash
value of the Policy. This could result in the cash value being insufficient to
cover the monthly deductions related to the increase. In such a case, the
grace period and termination provisions of the Policy would apply only to such
increase in death benefit. Since the monthly deduction with respect to the
increase in the death benefit could reduce the cash value of the Policy to
zero, it may be advantageous for the Policy owner, at the time of the total
disability, to reduce the death benefit to that amount which is subject to
this rider.
Accidental Death Benefit. This rider provides additional insurance equal to
an amount stated in the Policy if the insured dies from an accident prior to
age 70. It also provides an additional amount equal to twice the stated amount
if the insured dies from an accident occurring while the insured is a fare-
paying passenger on a common carrier. This rider is available at issue only.
Children's Term Insurance Benefit. This rider provides term insurance on
each insured child payable to the child's beneficiary if an insured child dies
before the end of coverage on that child (generally at the child's twenty-
fifth birthday).
Spouse Term Insurance Benefit. This rider provides term insurance on the
life of the spouse payable to the spouse's beneficiary if the spouse dies
prior to age 65 while the rider is in effect.
Accelerated Death Benefit. This rider provides for a one-time discounted
payment of all or a portion of the death benefit to the Policy owner once the
insured has been determined to be terminally ill with twelve months or less to
live. The size of the benefit payment and the maximum benefit are stated in
the rider. There are no premiums or rider fees for this rider. A payment of
all the discounted death benefit will not be subject to any surrender charges.
Upon payment of a portion of the death benefit, the death benefit under the
Policy is reduced to reflect the amount of the payment. In addition, the
specified face amount, the cash value and the cash surrender value are reduced
by the same proportion as the amount of the reduction of the death benefit
divided by the death benefit prior to the payment. Any outstanding loan is
reduced and paid out of the proceeds of the portion only if such reduction is
necessary to keep the Policy in force. Moreover, in the case of payment of all
of the death benefit, the amount of any outstanding Policy loan will be
deducted from the payment.
The payment under this rider may affect eligibility for benefits under state
or federal law. Generally, payments under this rider should be income tax free
as amounts paid by reason of the death of the insured. Counsel and other
competent advisors should be consulted to determine the effect on an
individual situation.
45
<PAGE>
METLIFE (R)
LOGO
FLEXIBLE PREMIUM MULTIFUNDED LIFE
PROSPECTUSES FOR
. FLEXIBLE PREMIUM MULTIFUNDED LIFE INSURANCE POLICIES
ISSUED BY
METROPOLITAN LIFE INSURANCE COMPANY
. METROPOLITAN SERIES FUND, INC.
[ART]
ML-UL2 (5/98 EDITION) PRINTED IN U.S.A. 1998 PORTFOLIO
96041ASX (EXP0597) MLIC-LD
<PAGE>
PART II
CONTENTS OF REGISTRATION STATEMENT
REPRESENTATION WITH RESPECT TO FEES AND CHARGES
Metropolitan Life represents that the fees and charges deducted under the
Policies offered and sold pursuant to this amended Registration Statement, in
the aggregate, are reasonable in relation to the services rendered, the
expenses to be incurred, and the risks assumed by Metropolitan Life under the
Policies. Metropolitan Life bases its representation on its assessment of all
of the facts and circumstances, including such relevant factors as: the nature
and extent of such services, expenses and risks, the need for Metropolitan
Life to earn a profit, the degree to which the Policies include innovative
features, and regulatory standards for exemptive relief under the Investment
Company Act of 1940 used prior to October 1996, including the range of
industry practice. This representation applies to all policies issued pursuant
to this Registration Statement, including those sold on the terms specifically
described in the prospectuses contained herein, or any variations therein
based on supplements, amendments, endorsements or other riders to such
policies or prospectuses, or otherwise.
This Registration Statement comprises the following papers and documents:
The facing sheet.
Cross-Reference Table.
New Product Prospectus consisting of 45 pages.
Old Product Prospectus, consisting of 96 pages.++++
Undertaking to File Reports (filed with the initial filing of this
Registration Statement on May 14, 1992.)
Undertaking pursuant to Rule 484(b)(1) under the Securities Act of 1933
(filed with the initial filing of this Registration Statement on May
14, 1992.)
Representation with respect to fees and charges.
The signatures.
Written Consents of the following persons:
Company Actuary (filed with Exhibit 6 below) (to be filed by post-
effective amendment).
Independent Auditors (to be filed by post-effective amendment)
The following exhibits:
<TABLE>
<C> <S> <C>
1.A (1) --Resolution of Board of Directors of Metropolitan Life
effecting the establishment of Metropolitan Life Separate
Account UL................................................. ++++
(2) --Not Applicable
(3) --(a) Not Applicable
--(b) Form of Selected Broker Agreement..................... ++++
--(c) Schedule of Sales Commissions......................... ++
(4) --Not applicable
(5) --(a) (i) Specimen Old Product Flexible Premium Multifunded
Life Insurance Policy (including application and any
alternate pages as required by state law) with form
of riders, if any.................................... ++++
(ii) Specimen New Product Flexible Premium Multifunded Life
Insurance Policy (including application and any
alternate pages required by state law) with form of
riders............................................... +
--(b) Riders for Disability Waiver Rider, and Accidental
Death Benefit............................................... ++++
</TABLE>
II-1
<PAGE>
<TABLE>
<C> <S> <C>
--(c) Riders for Accelerated Death Benefit, Children's Term
Insurance Benefit and Spouse Term Insurance Benefit......... ++++
--(d) New York Endorsement for Old Product to Flexible
Premium Multifunded Life Insurance Policy................ ++++
--(e) Additional alternate pages for Old Product required by
state law.................................................... ++++
--(f) Endorsement adding death benefit Option C for Old
Product...................................................... ++++
(6) --(a) Charter and By-Laws of Metropolitan Life............... +++
--(b) Amendment to By-laws................................... +++
(7) --Not Applicable
(8) --Not Applicable
(9) --Not Applicable
2. --See Exhibit 1.A(5) above
3. --Opinion and consent of Counsel as to the legality of the
securities being registered................................. ++++++
4. --Not Applicable
5. --Not Applicable
6. --Opinion and consent of relating to the Flexible
Premium Multifunded Life Insurance Policies (to be filed by
amendment)
8. --Powers of Attorney......................................... +++++
9. --Method of Computing Exchange pursuant to Rule 6e-
3(T)(b)(13)(v)(B) under the Investment Company Act of 1940
(not required because there will be no cash value
adjustments)
11. --Memoranda describing certain procedures filed pursuant to
Rule 6e-3(T)(b)(12)(iii).................................... ++++
27. --Financial Data Schedule (inapplicable)
</TABLE>
- --------
+ Filed herewith.
++ Incorporated by reference from "Distribution of the Policies" in the
Prospectus included herein.
+++ Incorporated by reference to the filing of Post-Effective Amendment No.
4 to the Registration Statement of Separate Account UL (File No. 33-
57320) on March 1, 1996.
++++ Included in the filing of Post-Effective Amendment No. 5 to this
Registration Statement on April 30, 1997.
+++++ Included in the filing of Post-Effective Amendment No. 5 to this
Registration Statement on April 30, 1997 except for Robert H.
Benmosche's power of attorney, which is incorporated by reference to
the Registration Statement of Separate Account UL (File No. 333-40161)
filed on November 13, 1997 and Stewart G. Nagler's power of attorney
which is included in the filing of Post-Effective Amendment No. 6 to
this Registration Statement on December 23, 1997, and James P.
Bossert's power of attorney which is filed herewith.
++++++ Included in the filing of Post-Effective Amendment No. 6 to this
Registration Statement on December 23, 1997.
II-2
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, METROPOLITAN
LIFE INSURANCE COMPANY HAS DULY CAUSED THIS AMENDED REGISTRATION STATEMENT TO
BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED THEREUNTO DULY AUTHORIZED, AND ITS
SEAL TO BE HEREUNTO AFFIXED AND ATTESTED, ALL IN THE CITY OF NEW YORK, STATE
OF NEW YORK, THIS 27TH DAY OF FEBRUARY, 1998.
METROPOLITAN LIFE
INSURANCE COMPANY
(Seal)
By: /s/ Gary A. Beller
-----------------------------------
GARY A. BELLER, ESQ.
SENIOR EXECUTIVE VICE-PRESIDENT &
GENERAL COUNSEL
Attest: /s/ Ruth Gluck
--------------------------------
RUTH GLUCK, ESQ.
ASSISTANT SECRETARY
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS AMENDED
REGISTRATION STATEMENT HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS IN THE
CAPACITIES AND ON THE DATES INDICATED.
SIGNATURE TITLE DATE
* Chairman, Chief
- ------------------------------------- Executive Officer
HARRY P. KAMEN and Director
(Principal
Executive Officer)
* President, Chief
- ------------------------------------- Operating Officer
ROBERT H. BENMOSCHE and Director
*
- ------------------------------------- Senior Executive
STEWART G. NAGLER Vice-President and
Chief Financial
Officer (Principal
Financial Officer)
and Director
*
- ------------------------------------- Vice-President
(Principal
JAMES P. BOSSERT Accounting Officer)
* Director
- -------------------------------------
CURTIS H. BARNETTE
* Director
- -------------------------------------
GERALD CLARK
* Director
- -------------------------------------
JOAN GANZ COONEY
*By /s/ Christopher P. Nicholas
---------------------------------- February 27,
CHRISTOPHER P. NICHOLAS, ESQ. 1998
ATTORNEY-IN-FACT
II-3
<PAGE>
SIGNATURE TITLE DATE
* Director
- ------------------------------------
BURTON A. DOLE, JR.
* Director
- ------------------------------------
JAMES R. HOUGHTON
* Director
- ------------------------------------
HELENE L. KAPLAN
* Director
- ------------------------------------
CHARLES M. LEIGHTON
* Director
- ------------------------------------
ALLEN E. MURRAY
* Director
- ------------------------------------
JOHN J. PHELAN, JR.
* Director
- ------------------------------------
HUGH B. PRICE
* Director
- ------------------------------------
ROBERT G. SCHWARTZ
* Director
- ------------------------------------
RUTH J. SIMMONS, PH.D.
* Director
- ------------------------------------
WILLIAM S. SNEATH
* Director
- ------------------------------------
WILLIAM C. STEERE, JR.
/s/ Christopher P. Nicholas
*By ________________________________ February 27,
CHRISTOPHER P. NICHOLAS, ESQ. 1998
ATTORNEY-IN-FACT
II-4
<PAGE>
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT,
METROPOLITAN LIFE SEPARATE ACCOUNT UL, HAS DULY CAUSED THIS AMENDED
REGISTRATION STATEMENT TO BE SIGNED, ON ITS BEHALF BY THE UNDERSIGNED
THEREUNTO DULY AUTHORIZED, AND ITS SEAL TO BE HEREUNTO AFFIXED AND ATTESTED,
ALL IN THE CITY OF NEW YORK, STATE OF NEW YORK THIS 27TH DAY OF FEBRUARY,
1998.
METROPOLITAN LIFE SEPARATE ACCOUNT
UL
(REGISTRANT)
By: METROPOLITAN LIFE INSURANCE
COMPANY
(DEPOSITOR)
(Seal)
By: /s/ Gary A. Beller
------------------------------
GARY A. BELLER, ESQ. SENIOR
EXECUTIVE VICE-PRESIDENT AND
GENERAL COUNSEL
Attest: /s/ Ruth Gluck
-------------------------------
RUTH GLUCK, ESQ. ASSISTANT
SECRETARY
II-5
<PAGE>
EXHIBIT 1.A(5)(a)(ii)
[LOGO] MetLife(R)
- --------------------------------------------------------------------------------
Metropolitan Life
Insurance Company
A Mutual Company Incorporated in New York State
- --------------------------------------------------------------------------------
Metropolitan Life Insurance Company will pay the amount of insurance and
provide the other benefits of this policy according to its provisions.
Louis J. Ragusa Robert H. Benmosche
Vice-President and Secretary President and Chief Operating Officer
Insured JOHN A. DOE
Specified Face Amount
of Insurance $100,000 AS OF DATE OF POLICY
Policy Number SPECIMEN
Plan FLEXIBLE PREMIUM MULTIFUNDED LIFE
FLEXIBLE PREMIUM MULTIFUNDED LIFE INSURANCE POLICY
Life insurance payable if the insured dies before the Final Date of Policy.
Cash Value, if any, less any policy loan and loan interest, payable on the
Final Date.
Adjustable death benefit.
Premiums payable while the insured is alive and before the Final Date of
Policy. Premiums must be sufficient to keep the policy in force.
Not eligible for dividends.
THE CASH VALUE IN EACH INVESTMENT DIVISION OF THE SEPARATE ACCOUNT IS BASED ON
THE INVESTMENT EXPERIENCE OF THAT INVESTMENT DIVISION AND MAY INCREASE OR
DECREASE DAILY. IT IS NOT GUARANTEED AS TO DOLLAR AMOUNT. SEE THE SEPARATE
ACCOUNT PROVISION ON PAGE 11.
THE CASH VALUE IN THE FIXED ACCOUNT WILL BE CREDITED WITH INTEREST AT A
GUARANTEED RATE SHOWN ON PAGE 3.1. WE MAY CREDIT ADDITIONAL INTEREST IN EXCESS
OF THE GUARANTEED RATE. SEE THE FIXED ACCOUNT PROVISION ON PAGE 10.
THE AMOUNT OR THE DURATION OF THE DEATH BENEFIT, OR BOTH, MAY BE VARIABLE OR
FIXED AS DESCRIBED IN THIS POLICY.
RIGHT TO EXAMINE POLICY--PLEASE READ THIS POLICY. YOU MAY RETURN IT TO US OR TO
THE REPRESENTATIVE THROUGH WHOM YOU BOUGHT WITHIN 10 DAYS FROM THE DATE YOU
RECEIVE IT OR WITHIN 45 DAYS AFTER THE APPLICATION IS SIGNED, WHICHEVER PERIOD
ENDS LATER. IF YOU RETURN THIS POLICY WITHIN THIS PERIOD, THE POLICY WILL BE
VOID FROM THE BEGINNING. WE WILL REFUND ANY PREMIUM PAID.
See Table of Contents and Company address on the last page.
READ THIS POLICY CAREFULLY. This policy is a legal contract between the policy
owner and Metropolitan Life Insurance Company.
1
<PAGE>
METROPOLITAN LIFE INSURANCE COMPANY
POLICY SPECIFICATIONS
DATE OF POLICY .......................... MAY 1, 1998
INSURED'S AGE AND SEX ................... 35 MALE
FINAL DATE OF POLICY .................... POLICY ANNIVERSARY AT AGE 95
DEATH BENEFIT ........................... OPTION A (SEE PAGE 7)
OWNER ................................... JOHN A. DOE
BENEFICIARY ............................. JANE DOE
POLICY CLASSIFICATION ................... STANDARD NONSMOKER
INSURED
JOHN A. DOE
SPECIFIED
FACE AMOUNT
OF INSURANCE ...... $100,000 AS OF DATE OF POLICY SPECIMEN ...POLICY NUMBER
PLAN ....... FLEXIBLE PREMIUM MULTIFUNDED LIFE
THIS POLICY PROVIDES LIFE INSURANCE COVERAGE UNTIL THE FINAL DATE IF SUFFICIENT
PREMIUMS ARE PAID. THE PLANNED PREMIUM SHOWN BELOW MAY NEED TO BE INCREASED TO
KEEP THIS POLICY AND COVERAGE IN FORCE.
MINIMUM INITIAL PREMIUM .............................. $ 717 ANNUALLY
PLANNED PREMIUM ...................................... $ 717 ANNUALLY
REQUIRED ADMINISTRATIVE PREMIUM ...................... $ 717 ANNUALLY
GUARANTEED MINIMUM DEATH BENEFIT PREMIUM ............. $ 717 ANNUALLY
GUARANTEED MINIMUM DEATH BENEFIT PERIOD .............. 30 YEARS
SEE THE FOLLOWING PAGE 3 (CONT'D) FOR ANY ADDITIONAL BENEFITS
3
<PAGE>
POLICY SPECIFICATIONS
ADDITIONAL BENEFITS
FINAL DATE RIDER INSURANCE
RIDER OF RIDER BENEFIT
3 (CONT'D)
<PAGE>
POLICY SPECIFICATIONS
GUARANTEED INTEREST RATE FOR FIXED ACCOUNTS .............. 3.0% A YEAR
(EQUAL TO
.24663% A MONTH
.00810% A DAY)
EXPENSE
EXPENSE CHARGE .................................... 5.5% OF GROSS
PREMIUMS RECEIVED
UNDERWRITING CHARGE FOR
INCREASES IN SPECIFIED FACE AMOUNT ................ $5 PER MONTH FOR
12 POLICY MONTHS
FOLLOWING THE
INCREASE
ADMINISTRATIVE CHARGES
DURING THE FIRST TWELVE POLICY MONTHS ............. $30 PER MONTH
THEREAFTER ........................................ $10 PER MONTH
REDUCTION IN ADMINISTRATIVE CHARGES ............... $4 PER MONTH (SEE PAGE 9)
MAXIMUM MORTALITY AND EXPENSE RISKS CHARGES ....... .075% OF THE CASH VALUE
OF THE SEPARATE
ACCOUNT AT THE
BEGINNING OF EACH
POLICY MONTH.
AFTER THE FIRST TWELVE POLICY MONTHS WE MAY WAIVE A PORTION OF THE
ADMINISTRATIVE CHARGES IN ANY YEAR THE REQUIRED ADMINISTRATIVE PREMIUM IS PAID.
MAXIMUM TRANSFER CHARGE ........................... $25
SURRENDER CHARGE .................................. SEE PAGE 4.1
SPECIFIED FACE
AMOUNT LIMITS ................................. YOU MAY NOT REDUCE
YOUR SPECIFIED FACE
AMOUNT OF INSURANCE
TO LESS THAN $50,000
DURING THE FIRST 5 POLICY
YEARS OR TO LESS THAN
$25,000 AFTER THE 5th
POLICY YEAR
3.1
<PAGE>
TABLE OF GUARANTEED MAXIMUM RATES FOR EACH $1,000 OF TERM INSURANCE
(SEE COST OF TERM INSURANCE" PROVISION ON PAGE 9).
<TABLE>
<CAPTION>
- --------------------- ------------------------------------------- -------------------- -----------------------------------------
Age Monthly Rate* Age Monthly Rate*
- --------------------- ------------------------------------------- -------------------- -----------------------------------------
Male Female Male Female
- --------------------- --------------------- --------------------- -------------------- -------------------- --------------------
<S> <C> <C> <C> <C> <C>
</TABLE>
* If there is a supplemental rating of the life insurance benefit, as shown
on page 3, the monthly charges for such supplemental rating must be added
to the monthly rate determined from this table.
4
<PAGE>
TABLE OF MAXIMUM SURRENDER CHARGES
<TABLE>
<CAPTION>
MAXIMUM MAXIMUM
DURING POLICY SURRENDER DURING POLICY SURRENDER
YEAR CHARGE YEAR CHARGE
---- ------ ---- ------
<S> <C> <C> <C>
1 1055.25 9 590.94
2 1407.00 10 506.52
3 1266.30 11 422.10
4 1125.60 12 337.68
5 984.90 13 253.26
6* 844.20 14 168.84
7 759.78 15 84.42
8 675.36 16 and Later 0
</TABLE>
SEE PAGE 14 FOR AN EXPLANATION OF THE SURRENDER CHARGES.
*AFTER THE 5TH POLICY YEAR THE MAXIMUM SURRENDER CHARGES WILL DECREASE EACH
POLICY MONTH.
4.1
<PAGE>
DESCRIPTION OF INVESTMENT DIVISIONS IN THE SEPARATE ACCOUNT
THE ASSETS IN EACH INVESTMENT DIVISION OF METROPOLITAN LIFE SEPARATE ACCOUNT UL
(SEPARATE ACCOUNT) ARE INVESTED IN SHARES OF A DESIGNATED INVESTMENT COMPANY
PORTFOLIO. EACH PORTFOLIO REPRESENTS A DIFFERENT CLASS (OR SERIES) OF SHARES
ISSUED BY METROPOLITAN SERIES FUND, INC.
DIVISION 1-- STATE STREET RESEARCH GROWTH PORTFOLIO--The investment
objective of this portfolio is to achieve long-term growth of
capital and income, and moderate current income, by investing
primarily in common stocks that are believed to be of good
quality or to have good growth potential or which are
considered to be undervalued based on historical investment
standards.
DIVISION 2-- STATE STREET RESEARCH INCOME PORTFOLIO--The investment
objective of this portfolio is to achieve the highest possible
total return, by combining current income with capital gains,
consistent with prudent investment risk and the preservation
of capital, by investing primarily in fixed-income,
high-quality debt securities.
DIVISION 3-- STATE STREET RESEARCH DIVERSIFIED PORTFOLIO--The investment
objective of this portfolio is to achieve a high total return
while attempting to limit investment risk and preserve capital
by investing in equity securities, fixed-income debt
securities, or short-term money market instruments, or any
combination thereof, at the discretion of State Street
Research.
DIVISION 4-- STATE STREET RESEARCH AGGRESSIVE GROWTH PORTFOLIO--The
investment objective of this portfolio is to achieve maximum
capital appreciation by investing primarily in common stocks
(and equity and debt securities convertible into or carrying
the right to acquire common stocks) of emerging growth
companies, undervalued securities or special situations.
DIVISION 5-- STATE STREET RESEARCH INTERNATIONAL STOCK PORTFOLIO--The
investment objective of this portfolio is to achieve long-term
growth of capital by investing primarily in common stocks and
equity-related securities of non-United States companies.
DIVISION 6-- METLIFE STOCK INDEX PORTFOLIO-- The investment objective of
this portfolio is to equal the performance of the Standard &
Poor's 500 Composite Stock Price Index (adjusted to assume
reinvestment of dividends) by investing in the common stock of
companies which are included in the index.
DIVISION 7-- LOOMIS SAYLES HIGH YIELD BOND PORTFOLIO-- The investment
objective of this portfolio is to achieve high total
investment return through a combination of current income and
capital appreciation. The Portfolio will normally invest at
least 65% of its assets in fixed income securities of below
investment grade quality.
DIVISION 8-- JANUS MID CAP PORTFOLIO-- The investment objective of this
non-diversified portfolio is to provide long-term growth of
capital. It pursues this objective by investing primarily in
securities issued by medium sized companies.
DIVISION 9-- T. ROWE PRICE SMALL CAP GROWTH PORTFOLIO-- The investment
objective of this portfolio is to achieve long-term growth by
investing in small capitalization companies.
DIVISION 10-- SCUDDER GLOBAL EQUITY PORTFOLIO-- The investment objective of
this portfolio is to achieve long-term growth of capital
through a diversified portfolio of marketable securities,
primarily equity securities, including common stocks,
preferred stocks and debt securities convertible into common
stocks. The Portfolio invests on a worldwide basis in equity
securities of companies which are incorporated in the U.S. or
in foreign countries. It also may invest in the debt
securities of U.S. and foreign issuers. Income is an
incidental consideration.
INVESTMENT RETURNS WILL REFLECT FLUCTUATIONS IN THE MARKET VALUE OF SECURITIES.
PLEASE REFER TO THE CURRENT PROSPECTUS FOR METROPOLITAN SERIES FUND, INC. FOR A
COMPLETE DESCRIPTION OF THE FUND AND THE CURRENTLY AVAILABLE DESIGNATED
PORTFOLIOS.
5
<PAGE>
DEFINITIONS
This policy provides life insurance through flexible premium payments. Net
premiums are credited at your option to either a fixed interest account
("Fixed Account") or a multifunded separate account ("Separate Account") or
both. Interest will be credited to the Cash Value in the Fixed Account. The
Cash Value in the Separate Account will vary with investment experience.
You may choose to allocate the deduction of the cost of insurance and other
charges each month proportionately from the Fixed Account and the Separate
Account or all from the Fixed Account.
"You" and "your" refer to the owner of this policy.
"We", "us" and "our" refer to Metropolitan Life Insurance Company.
The "insured" named on page 3 is the person at whose death the insurance
proceeds will be payable.
The "Specified Face Amount of Insurance" as of the Date of Policy is shown
on page 3. A new page 3 will be issued to show any change in the Specified
Face Amount of Insurance that has occurred at your request.
The "Date of Policy" is shown on page 3.
The "Final Date of Policy" is the policy anniversary on which the insured
is age 95.
Policy years and months are measured from the Date of Policy. For example,
if the Date of Policy is May 5, 2001, the first policy month ends June 4,
2001 and the first policy year ends May 4, 2002. Similarly, the first
monthly anniversary is June 5, 2001, and the first policy anniversary is
May 5, 2002.
The "Designated Office" is our Home Office at One Madison Avenue, New York,
N.Y. 10010. We may, by written notice, name other offices within the United
States to serve as Designated Offices. The "Investment Start Date" is the
later of: (1 )the Date of Policy; and (2) the date we receive the first
premium at our Designated Office.
The "Allocation Date" is twenty calendar days after the Investment Start
Date.
"Issue Age" is the age of the insured shown on Page 3.
"Fixed Account" is the account under the policy to which we will add the
payments that you allocate to the Fixed Account. The Fixed Account is part
of our general account.
"Separate Account" is Metropolitan Life Separate Account UL, the account
under this policy to which we will add the payments that you allocate to
any of the Investment Divisions in the Separate Account.
"Policy Loan Account" is the account to which we will transfer the amount
of any policy loan from the Fixed and Separate Accounts.
"Cash Value" is the sum of: (a) the value in the Fixed Account; (b) the
value in each investment division of the Separate Account; and (c) the
value in the Policy Loan Account.
"Cash Surrender Value" is the Cash Value less any policy loan and loan
interest and any applicable surrender charge and, if the policy is
surrendered in the first policy year, less the Administrative Charges for
each full policy month remaining to the end of the first policy year.
To make this policy clear and easy to read, we have left out many
cross-references and conditional statements. Therefore, the provisions of
the policy must be read as a whole. For example, our payment of the
insurance proceeds (see page 7) depends upon the payment of sufficient
premiums (see page 15).
To exercise your rights, you should follow the procedures stated in the
policy. If you want to request a payment, change the allocations of net
premiums and/or Cash Value, adjust the death benefit, change a beneficiary,
change an address or request any other action by us, you should do so on
the forms prepared for each purpose. You can get these forms from our
Designated Office.
6
<PAGE>
PAYMENT WHEN INSURED DIES
INSURANCE If the insured dies before the Final Date of Policy, and while
PROCEEDS the policy is in force, an amount of money, called the
insurance proceeds, will be paid to the beneficiary. The
insurance proceeds are the sum of:
* The death benefit described below
PLUS
* Any insurance on the insured's life that may be
provided by riders to this policy
MINUS
* Any policy loan and loan interest
MINUS
* Any due and unpaid monthly deductions accruing during a
grace period.
We will pay the insurance proceeds to the beneficiary after we
receive sufficient proof of death and a proper written claim.
DEATH BENEFIT Before the Final Date of Policy the death benefit under this
policy will be either 1, 2 or 3 below, whichever is chosen and
is in effect at the time of death, but in no event less than
the alternative death benefit.
1. OPTION A: The Specified Face Amount of Insurance.
2. OPTION B: The Specified Face Amount of Insurance
PLUS
The Cash Value on the date of death.
3. OPTION C: a) If death occurs prior to the policy
anniversary on which the insured is age 65:
The Specified Face Amount of Insurance.
PLUS
The Cash Value on the date of death.
On the policy anniversary on which the
insured is age 65, the Specified Face Amount
of Insurance will be changed to equal the
Specified Face Amount of Insurance plus the
cash value at the end of the previous day.
We will issue a new page 3 at that time to
show the change.
b) If death occurs on or after the policy
anniversary on which the insured is age 65:
The Specified Face Amount of Insurance.
See the Full and Partial Cash Withdrawal provision for the
effect of a partial withdrawal on the death benefit.
ALTERNATIVE In no event will the death benefit be less than the amounts
DEATH BENEFIT described below:
<TABLE>
<CAPTION>
ALTERNATIVE DEATH BENEFIT
AGE ON DATE AS A PERCENTAGE OF THE
OF DEATH CASH VALUE
-------- ----------
<S> <C>
40 or younger 250%
41-45 243-215
46-50 209-185
51-55 178-150
56-60 146-130
61-65 128-120
66-70 119-115
71-75 113-105
76-90 105
91-95 104-100
96 and over 100
</TABLE>
The Alternative Death Benefit percentage will decrease uniformly within the age
ranges shown.
7
<PAGE>
PAYMENT WHEN INSURED DIES (CONTINUED)
GUARANTEED If the Cash Surrender Value is not sufficient to keep this
MINIMUM policy in force (see Premiums provision on page 15) we will
DEATH BENEFIT pay the Insurance Proceeds if:
1. A Guaranteed Minimum Death Benefit Premium and a
Guaranteed Minimum Death Benefit Period is shown on
page 3
AND
2. The insured dies during the Guaranteed Minimum Death
Benefit Period
AND
3. The total premiums paid to the date of death, less any
partial cash withdrawals and outstanding loan, have
always equaled or exceeded the Guaranteed Minimum Death
Benefit Premium due to that date.
Any increase or decrease in the Specified Face Amount of
Insurance will result in an adjustment in the Guaranteed
Minimum Death Benefit Premium, and a new page 3 reflecting
this change will be issued.
We will send you a notice if the requirement in item 2. above
is not met. The notice will state the premium which will have
to be paid to retain the guarantee and the impact that not
paying the necessary premium will have on this benefit. If
sufficient premiums are not paid within 61 days of the date of
the notice, this guarantee will terminate and the policy will
continue under the terms of the Premiums provision.
If this benefit terminates it cannot be reinstated.
DEATH BENEFIT At any time after the second policy year (while this policy is
ADJUSTMENT in force), you may: (a) change the death benefit option, but
not more than once every 12 months; and/or (b) change (either
increase or decrease) the Specified Face Amount of Insurance,
but not more than once every 24 months. Any such change is
subject to the following:
1. In the event of a change in the death benefit option,
we will change the Specified Face Amount of Insurance
as follows:
a. If you change from Option A to Option B, the
Specified Face Amount of Insurance will be
decreased by the then current cash value.
b. If you change from Option B to Option A, the
Specified Face Amount of Insurance will be
increased by the then current cash value.
c. If you change from Option C to Option A prior to
the policy anniversary on which the insured is age
65, the Specified Face Amount of Insurance will be
increased by the then current cash value. If you
make this option change later, there will be no
change in the Specified Face Amount of Insurance.
d. If you change from Option C to Option B prior to
the policy anniversary on which the insured is age
65, there will be no change in the Specified Face
Amount of Insurance. If you make this change
later, the Specified Face Amount of Insurance will
be reduced by the then current cash value.
e. If you change from Option A to Option C, the
Specified Face Amount of Insurance will be reduced
by the then current cash value. You may not change
to Option C at any time after the policy
anniversary on which the insured is age 60.
f. If you change from Option B to Option C there will
be no change in the Specified Face Amount of
Insurance. You may not change to Option C at any
time after the policy anniversary on which the
insured is age 60.
A change in the Specified Face Amount of Insurance may change
the Cost of Term Insurance and the administrative charges.
2. The Specified Face Amount of Insurance may not be
reduced to less than the Specified Face Amount Limits
shown on page 3.1, nor may it be reduced to a level
where the total premiums already paid to date exceed
the then current Internal Revenue Service limits
relating to the definition of life insurance.
8
<PAGE>
PAYMENT WHEN INSURED DIES (CONTINUED)
3. The Specified Face Amount of Insurance may not be
increased after the insured reaches age 80. For any
change at your request which would increase the death
benefit, you must provide evidence satisfactory to us
of the insurability of the insured. Each increase must
be at least $5,000. For 12 months following the
increase a charge of $5 per month will be added to the
monthly deductions. New surrender charges will apply
for 15 policy years after the increase.
4. No change in the death benefit will take effect unless
the cash surrender value after the change is equal to
at least two monthly deductions. A request for a change
in the death benefit will take effect as of the monthly
anniversary which coincides with or next follows: (a)
if evidence of insurability is required, the date we
approve the request, or (b) if not, the date of the
request.
5. We will issue a new page 3 for this policy showing the
change. We may require that you send us this policy to
make any requested change.
MONTHLY DEDUCTION
The deduction for any policy month is the sum of the following
amounts, determined on each monthly anniversary:
* The monthly cost of term insurance prior to the Final
Date;
* The monthly mortality and expense risks charges, if
applicable;
* The monthly administrative charge;
* The monthly cost of any benefits provided by rider;
* For the 12 months after your request results in an
increase in the Specified Face Amount, the underwriting
charge, as shown on page 3.1.
The monthly administrative charge may be reduced if (1) the
total premiums paid, less any partial cash withdrawals and
outstanding loan, equal or exceed the Required Administrative
Premium due to date or (2) the premium paid during the most
recent planned premium modal period was equal to or exceeded
the Required Administrative Premium. (Modal period refers to
the frequency of planned premium payments shown on page 3.)
The amount of this reduction is shown on page 3.1.
Within 30 days before or 30 days after the policy anniversary,
you may choose to have the monthly deduction charged
proportionately to the Fixed Account and each Investment
Division of the Separate Account or all to the Fixed Account.
If you choose to have the monthly deduction charged to the
Fixed Account and its value is not sufficient to cover the
deduction, the remainder will be charged proportionately to
each Investment Division of the Separate Account.
COST OF TERM Under all death benefit options, the amount of the term
INSURANCE insurance for any policy month is equal to:
* The death benefit divided by one plus the monthly
guaranteed interest rate shown on page 3.1;
MINUS
* The Cash Value.
The Cash Value used in this calculation is the Cash Value
before the deduction for the monthly cost of term insurance
and for any disability waiver benefit, but after the deduction
for riders and any other charges.
The cost of term insurance for any policy month is equal to
the amount of term insurance multiplied by the monthly term
insurance rate. After the Final Date the cost of term
insurance is zero. Monthly term insurance rates will be set by
us from time to time, based on the insured's age, sex, and
underwriting class. But these rates will never be more than
the maximum rates shown in the table on page 4. Any changes in
mortality charges will not recoup past losses. Any adjustments
in policy cost factors will be by class and based on changes
in such factors as mortality, persistency and expenses.
9
<PAGE>
FIXED ACCOUNT
VALUE The value of the Fixed Account on the Investment Start Date is
equal to:
1. The portion of the initial net premium which has been
paid;
MINUS
2. The portion of any monthly deductions charged to the
Fixed Account.
The value of the Fixed Account on any day on or after the
Allocation Date is equal to:
1. The value on the preceding day, with interest on such
values at the current applicable rates;
PLUS
2. Any portion of net premium paid and allocated to the
Fixed Account on that day;
PLUS
3. Any amount transferred to the Fixed Account on that
day;
MINUS
4. Any amount transferred from the Fixed Account on that
day;
MINUS
5. Any cash withdrawal made from the Fixed Account on that
day;
MINUS
6. The portion of any transfer charge allocated to the
value of the Fixed Account;
MINUS, IF THAT DAY IS A MONTHLY ANNIVERSARY,
7. The portion of the monthly deduction which is charged
to the Fixed Account, to cover the policy month which
starts on that day.
INTEREST The guaranteed interest rate for the Fixed Account is shown on
RATE page 3.1.
We may declare rates of interest in excess of the guaranteed
rate on amounts in the Fixed Account at any time, subject to
the following conditions: the rate of excess interest on any
net premiums paid during a month of the year will not change
until the first day of the same month in the following year.
We also may credit different rates of excess interest to
premium payments made in different months of the year and
different rates of excess interest at the end of each
twelve-month period for Cash Value related to premiums
received in a given month of each prior year. Transfers made
into the Fixed Account will be treated as new premium payments
for these purposes. However, if, within 12 months of the date
of a transfer from the Fixed Account to the Separate Account,
all or part of the amount transferred is transferred back to
the Fixed Account, the interest credited to the amount
transferred back to the Fixed Account will be at the rate that
would have been credited had it remained in the Fixed Account
all along.
We will credit the guaranteed and any excess interest on every
Valuation Date. Once credited, that interest will be
guaranteed and will become part of the value in the Fixed
Account from which monthly deductions are made. The monthly
deduction will be charged against the most recent premiums
paid (and transfers made) and interest credited.
10
<PAGE>
SEPARATE ACCOUNT
Separate Account UL is an investment account established and
maintained by us, separate from our general account or other
separate investment accounts. It is used for flexible premium
variable life insurance policies, and if permitted by law, may
be used for other policies or contracts as well.
We own the assets in the Separate Account. Assets equal to the
reserves and other liabilities of the Separate Account will
not be charged with liabilities that arise from any other
business we conduct. We may from time to time transfer to our
general account assets in excess of such reserves and
liabilities.
Income and realized and unrealized gains or losses from assets
in the Separate Account are credited to or charged against the
Separate Account without regard to our other income, gains or
losses. The Separate Account will be valued at the end of each
Valuation Period. A "Valuation Date" is each day on which
there is enough trading in a portfolio's securities that the
current value of its shares could be materially affected. In
general, Valuation Dates will be days when the New York Stock
Exchange is open for trading. We reserve the right, on 30 days
notice, to change the basis for such Valuation Date, as long
as the basis is not inconsistent with applicable laws.
A "Valuation Period" is the period between successive
Valuation Dates starting at the close of the New York Stock
Exchange, on each Valuation Date and ending at the close of
the New York Stock Exchange, on the next Valuation Date. We
reserve the right, on 30 days notice, to change the basis for
such Valuation Period, as long as the basis is not
inconsistent with applicable laws.
INVESTMENT The "Investment Divisions" are part of the Separate Account.
DIVISIONS Each division holds a separate class (or series) of stock of a
designated investment company or companies. Each class of
stock represents a separate portfolio in an investment
company.
The Investment Divisions available on the Date of Policy are
described on Page 5. We may from time to time make other
Investment Divisions available to you. We will provide you
with written notice of all material details including
investment objectives and all charges.
OUR RIGHT We reserve the right to make certain changes if, in our
TO MAKE judgment, they would best serve the interests of the owners
CHANGES of policies such as this one, or would be appropriate in
carrying out the purposes of such policies. Any changes will
be made only to the extent and in the manner permitted by
applicable laws. Also, when required by law, we will obtain
your approval of the changes and the approval of any
appropriate regulatory authority.
Example of the changes we may make include:
* To operate the Separate Account in any form permitted under
the Investment Company Act of 1940, or in any other form
permitted by law.
* To take any action necessary to comply with or obtain and
continue any exemptions from the Investment Company Act of
1940.
* To transfer any assets in an Investment Division to another
Investment Division, or to one or more separate accounts,
or to our general account, or add, combine, or remove
Investment Divisions in the Separate Account.
* To substitute, for the investment company shares held in
any Investment Division, the shares of another class of the
investment company or the shares of another investment
company or any other investment permitted by law.
* To change the way we assess charges, but without increasing
the aggregate amount charged to the Fixed Account and the
Separate Account.
* To make any other necessary technical changes in this
policy in order to conform with any action this provision
permits us to take.
11
<PAGE>
SEPARATE ACCOUNT (CONTINUED)
If any of these changes result in a material change in the
underlying investments of an Investment Division in the
Separate Account, we will notify you of such change. If you
have funds allocated to that division, you may then make a new
choice of Investment Divisions.
VALUE The value of the Separate Account is the sum of the Cash
Values in each of the Investment Divisions.
The value in each Investment Division of the Separate Account
on the Allocation Date is equal to:
1. The portion of the initial net premium which has been
paid and is allocated to the Investment Division;
MINUS
2. The portion of any monthly deductions charged to the
Investment Division.
The Cash Value in each Investment Division on subsequent
Valuation Dates is equal to:
1. The Cash Value in the Investment Division on the
preceding Valuation Date;
PLUS
2. Any increase due to the investment result in the
Investment Division of the Separate Account;
PLUS
3. Any net premium payments received during the current
Valuation Period which are allocated to the Investment
Division;
PLUS
4. Any net amounts transferred to the Investment Division
during the current Valuation Period;
MINUS
5. Any decrease due to the investment result in the
Investment Division of the Separate Account;
MINUS
6. Any amounts transferred from the Investment Division
during the current Valuation Period;
MINUS
7. Any cash withdrawal from the Investment Division during
the current Valuation Period;
MINUS
8. The portion of any transfer charge allocated to the
value in the Investment Division;
MINUS, IF A MONTHLY ANNIVERSARY OCCURS DURING THE
CURRENT VALUATION PERIOD,
9. The portion of the monthly deduction charged to the
Investment Division during the current Valuation Period
to cover the policy month which starts on that day.
12
<PAGE>
OWNER'S RIGHT TO CHANGE ALLOCATION
You can change the allocation of future net premiums to the
Fixed Account and/or the Investment Divisions of the Separate
Account. You must allocate at least 10% of net premiums to
each alternative you choose. Percentages must be in whole
numbers. (For example, 33 1/3% may not be chosen.) You must
notify us in writing, or by other means as determined by us,
of a change in the allocation percentages. The change will
take effect immediately upon receipt at our Designated Office.
You may also change the allocation of the Cash Value. To do
this, you may transfer amounts among the alternatives at any
time. A transfer charge of no more than $25 may be deducted
from the Cash Value from which amounts are transferred
proportionately among the Fixed Account and the Investment
Divisions of the Separate Account when each transfer is made.
However, no charge will be assessed for transfers arising from
policy loans and loan repayments. In addition, during the
first 24 policy months, no charge will be assessed for a
complete transfer of all amounts in the Investment Divisions
of the Separate Account to the Fixed Account. Transfers must
be in either dollar amounts or a percentage in whole numbers.
The minimum amount that may be transferred is $50, or, if
less, the entire value in an Investment Division of the
Separate Account or the entire value in the Fixed Account. The
minimum amount that may be transferred from the Fixed Account
in any policy year is $50. We reserve the right to restrict
the amount or timing of any transfer. The change will take
effect on the date we receive written notice from you at our
Designated Office.
EXCHANGE During the first 24 months following the Date of Policy, the
PRIVILEGE policy owner may transfer the entire amount in the Separate
Account to the Fixed Account and allocate all future net
premiums to the Fixed Account. This will serve as an exchange
of the policy for the equivalent of a flexible premium fixed
benefit life insurance policy. There will be no charge for
this transfer.
PAYMENTS DURING INSURED'S LIFETIME
PAYMENT ON If the insured is alive on the Final Date of Policy, and you
FINAL DATE do not ask us in writing to continue the policy, we will pay
OF POLICY you the Cash Surrender Value. Coverage under this policy will
then end.
You may ask us in writing to continue this policy after the
Final Date. If you do, the death benefit will be equal to the
Cash Value. The insurance proceeds will equal the death
benefit minus any outstanding policy loan and loan interest.
FULL AND We will pay you all or part of the Cash Surrender Value after
PARTIAL CASH we receive your request at our Designated Office. The Cash
WITHDRAWAL Surrender Value will be determined as of the date we receive
your request. If you request and are paid the full Cash
Surrender Value, this policy and all our obligations under it
will end. We may require surrender of this policy before we
pay you the full Cash Surrender Value.
Each partial withdrawal of Cash Value must be at least $500.
When a partial withdrawal is made, we will reduce the Cash
Value by the amount of the partial withdrawal plus any
applicable surrender charge. The reduction in Cash Value will
be allocated in the same manner you chose to have the Monthly
Deduction applied unless requested otherwise.
If either (i) Option A is then in effect; or (ii) Option C is
in effect and the policy anniversary on which the insured is
age 65 has passed, we will also reduce the Specified Face
Amount of Insurance by the amount of the partial withdrawal,
and a new page 3 will then be issued. We may require that you
send us this policy to make the change. Partial cash
withdrawals will not affect the Specified Face Amount of
Insurance if (i) Option B is in effect; or (ii) Option C is in
effect and the withdrawal is made prior to the policy
anniversary on which the insured is age 65.
13
<PAGE>
PAYMENTS DURING INSURED'S LIFETIME (CONTINUED)
A partial withdrawal which would reduce the cash surrender
value to less than two monthly deductions may not be made.
Also, if either (i) Option A is in effect; or (ii) Option C is
in effect and the policy anniversary on which the insured is
age 65 has passed, then a partial withdrawal may not be made
if it would reduce the Specified Face Amount of Insurance to
less than the Specified Face Amount Limits on Page 3.1, or to
a level where the premiums already paid would exceed the then
current Internal Revenue Service Limits. If you request a
partial cash withdrawal and these conditions apply, we will
contact you to determine if you want to cancel the request,
withdraw a smaller amount, or surrender the policy.
SURRENDER If, within the first 15 policy years, (i) you request a cash
CHARGES withdrawal, (ii) decrease the Specified Face Amount of
Insurance, or (iii) the policy ends because the grace period
expired, we will deduct a surrender charge from the cash
value. If you request a full cash withdrawal within the first
policy year, we will also deduct any administrative charges
not paid during the first policy year. We will also deduct a
surrender charge from the cash value if you have increased the
specified face amount and, within 15 years of the increase,
(i) you request a cash withdrawal or (ii) the policy ends
because the grace period expired. No surrender charge applies
to an increase in the Specified Face Amount of Insurance
resulting from a change in the death benefit option.
The smallest amount you can withdraw at any one time is $500.
If, in any policy year you make a partial withdrawal, we will
also deduct (from the policy's cash value) a proportional
amount of any surrender charge on the amount withdrawn that is
greater than 10% of the policy's cash surrender value. The
surrender charge will be allocated in the same manner as the
monthly deductions are allocated. If you decrease the
Specified Face Amount of Insurance we will, also, deduct a
proportional amount of any surrender charges from the policy's
cash value.
The surrender charges are shown on page 4.1. If there is an
increase or decrease in the surrender charges we will send you
a new page 4.1.
POLICY LOAN You may also get cash by taking a policy loan upon assignment
of this policy as sole security. If there is an existing loan,
you can increase it.
The maximum amount available for a new or increased loan will
be the policy's cash surrender value less two monthly
deductions.
The smallest amount you can borrow at any one time is $500.
You may choose to allocate the loan proportionately from the
Fixed Account and Investment Divisions of the Separate Account
or all from the Fixed Account.
Loan interest is charged daily at the rate up to a maximum of
6% a year and is due at the end of each policy year. Interest
not paid within 31 days after it is due will be added, as of
the due date, to the loan principal and will bear interest at
the same rate as the rest of the loan. Such unpaid interest
will be allocated in the same way you have chosen to have the
most recent policy loan allocated, and will be transferred to
the Policy Loan Account. The amount transferred will be
treated as an increased loan.
LOAN You may repay all or part (but not less than $50 or the
REPAYMENT planned premium whichever is less) of a policy loan at any
time while the insured is alive and this policy is in force.
Loan repayments will be allocated in the same manner as net
premium payments.
Failure to repay a policy loan or to pay loan interest will
not terminate this policy unless the cash surrender value is
less than the monthly deduction due on a monthly anniversary.
In that case, the Grace Period provision will apply (see page
15).
EFFECT OF When a loan is made, the cash value in each Investment
A POLICY Division of the Separate Account equal to the portion of the
LOAN ON THE policy loan allocated to each Investment Division will be
CASH VALUE transferred to a Policy Loan Account within the General
Account. The cash value in the Fixed Account equal to the
portion of the policy loan allocated to that Account will also
be transferred to the Policy Loan Account.
Amounts in the Policy Loan Account will be credited with
interest at a rate of no less than the rate being charged on
the loan minus 2% year. Interest credited to amounts in the
Policy Loan Account will be allocated at least once a year
among the Fixed Account and the Investment Divisions of the
Separate Account in the same proportions as net premiums are
then being allocated.
14
<PAGE>
PAYMENTS DURING INSURED'S LIFETIME (CONTINUED)
DEFERMENT We reserve the right to defer calculation and payment of
benefits in the following circumstances:
1. If your policy is in force with a Cash Value in the
Separate Account, it will generally not be practical
for us to determine the investment experience of the
Separate Account during any period when the New York
Stock Exchange is closed for trading (except for
customary weekend and holiday closings), or when the
Securities and Exchange Commission restricts trading or
determines that an emergency exists. In such a case and
with respect to the Separate Account, we reserve the
right to defer: (a) determination, application, or
payment of a cash withdrawal value; (b) determination
of policy loans except for a loan to pay a premium to
us; (c) a change in the allocation among the Investment
Divisions of the Separate Account; and (d) payment of
the death benefit.
2. If your policy is in force with a Cash Value in the
Fixed Account, we may defer paying a cash withdrawal
value from the Fixed Account for up to 6 months from
the date we receive a request for payment. If we delay
for 30 days or more, interest will be paid at a rate
not less than the guaranteed rate shown on page 3.1 or
at a rate required by law, if greater.
3. We may delay making a loan from the Fixed Account,
except for a loan to pay a premium to us, for up to 6
months from the date you request the loan.
PREMIUMS
PREMIUM Premium payments other than the first premium are to be sent
PAYMENTS to our Designated Office.
No insurance will take effect before the first premium is
paid. Other premiums may be paid at any time while the policy
is in force and before the Final Date of Policy and in any
amount subject to the limits described below.
We will send premium notices, if you request in writing,
according to the planned premium shown on page 3. You may skip
planned premium payments or change their frequency and amount
if the cash surrender value is large enough to keep your
policy in force; however, this may result in the loss of the
Guaranteed Minimum Death Benefit.
Premiums received while there is an outstanding loan will be
applied to the loan balance.
LIMITS Additional premium payments may be necessary to keep the
policy in force depending upon actual investment experience
and the timing and frequency of the premium payments, and
whether the Guaranteed Minimum Death Benefit is in effect.
Each planned premium payment must be at least $200 annually
and $100 semi-annually ($15 for a Special Account payment).
However, any unplanned premium payment must be at least $250.
We may increase these minimum premium limits. No increase will
take effect until 90 days after notice is sent.
The total premiums paid in a policy year may not exceed the
maximum we set for that year. When we set the maximum for
total premiums paid in a policy year, we will take account of
any requirements in federal legislation relating to the
definition of life insurance. We will return to you any
premium paid in a policy year to the extent it is more than
the maximum.
GRACE PERIOD If, at any time the Guaranteed Minimum Death Benefit is not in
effect, the Cash Surrender Value on any monthly anniversary is
less than the monthly deduction for that month, there will be
a grace period of 61 days after that anniversary to pay an
amount that will cover two monthly deductions. We will send
you a notice at the start of the grace period. We will also
send a notice to any assignee on our records.
If we do not receive a sufficient amount by the end of the
grace period, your policy will end without value. If the
insured dies during the grace period, we will pay the
insurance proceeds minus any overdue monthly deduction.
15
<PAGE>
PREMIUMS (CONTINUED)
REINSTATEMENT If the grace period has ended and you have not paid the
required premium and have not surrendered your policy for its
Cash Surrender Value, you may reinstate this policy while the
insured is alive if you:
1. Ask for reinstatement within 3 years after the end of
the grace period;
2. Provide evidence of insurability satisfactory to us;
and
3. Pay a sufficient amount to keep this policy in force
for at least 2 months after the date of reinstatement;
plus (a) an amount sufficient to cover the unpaid
portion of the charges applicable during the first 12
policy months; plus (b) any portion of the surrender
charges which was not paid when the policy ended
because the cash value was not sufficient to pay such
portion of the charges: plus (c) interest on (a) to the
date of reinstatement at the rate of 6% a year.
Any policy loan and interest due when the policy ends will be
canceled. The effective date of the reinstated policy will be
the date we approve the reinstatement application.
OWNERSHIP AND BENEFICIARY
OWNER As owner, you may exercise all rights under your policy while
the insured is alive. You have the right to name another
person to exercise your rights with our consent. You may name
a contingent owner who would become the owner if you should
die before the insured.
CHANGE OF You may name a new owner at any time. If a new owner is named,
OWNERSHIP any earlier choice of a contingent owner, beneficiary,
contingent beneficiary or optional payment plan will be
canceled, unless you specify otherwise.
BENEFICIARY The beneficiary is the person or persons designated by the
policy owner to receive insurance proceeds upon the death of
the insured. You may name a contingent beneficiary to become
the beneficiary if all the beneficiaries cease to exist while
the insured is alive. If no beneficiary or contingent
beneficiary exists when the insured dies, the owner (or the
owner's estate, if applicable) will be the beneficiary. While
the insured is alive, the owner may change any beneficiary or
contingent beneficiary. If more than one beneficiary exists
when the insured dies, we will pay them in equal shares,
unless you have chosen otherwise.
HOW TO CHANGE You may change the owner, contingent owner, beneficiary or
THE OWNER OR contingent beneficiary of this policy by written notice or
THE BENEFICIARY assignment of the policy. No change is binding on us until it
is recorded at our Designated Office. Once recorded, the
change binds us as of the date you signed it. The change will
not apply to any payment made by us before we recorded your
request. We may require that you send us this policy to make
the change.
COLLATERAL Your policy may be assigned as collateral. All rights under
ASSIGNMENT the policy will be transferred to the extent of the assignee's
interest. We are not bound by any assignment or release
thereof unless and until it is in writing and is recorded at
our Designated Office. We are not responsible for the validity
of any assignment.
EXCLUSION
SUICIDE The insurance proceeds will not be paid if the insured commits
suicide, while sane or insane, within 2 years from the Date of
Policy. Instead, we will pay the beneficiary an amount equal
to all premiums paid, without interest, less any policy loan
and loan interest and less any partial cash withdrawals. If
the insured commits suicide, while sane or insane, more than 2
years after the Date of Policy but within 2 years from the
effective date of any increase in the death benefit, our
liability with respect to such increase will be limited to the
cost of the increased death benefit charged since the
effective date of the increase.
16
<PAGE>
GENERAL PROVISIONS
THE CONTRACT This policy includes any riders and, with the application
attached at issue, and any application added after issue,
makes up the entire contract. All statements in the
application will be representations and not warranties. No
statement will be used to contest the policy unless it appears
in the application.
LIMITATION ON No representative or other person except our President, a
REPRESENTATIVE'S Vice-President or the Secretary may (a) make or change any
OR OTHER PERSON'S contract of insurance; or (b) make any binding promises about
AUTHORITY benefits; or (c) change or waive any of the terms of this
policy. Any change or waiver is valid only if made in writing
and signed by our President, Vice-President or Secretary.
INCONTESTABILITY We will not contest the validity of your policy after it has
been in force during the insured's lifetime for 2 years from
the Date of Policy. We will not contest the validity of any
increase in the death benefit after such increase has been in
force during the insured's lifetime for 2 years from its
effective date.
AGE AND SEX If the insured's age or sex on the Date of Policy is not
correct as shown on page 3, we will adjust the benefits under
this policy. If the insured dies before a correction is made,
the adjusted benefits will be the amounts bought by the
monthly deduction just before the date of death, based on the
correct age and sex. Otherwise we will recompute the value of
the Cash Value by taking out the monthly cost of term
insurance for the life of the policy, using the level of
benefits bought by the monthly deduction just before we
learned the correct age and sex.
NONPARTICIPATION This policy is not eligible for dividends; it does not
participate in any distribution of our surplus.
COMPUTATION The Fixed Account Cash Value is computed using a guaranteed
OF VALUES minimum interest rate shown on page 3.1. This value and the
maximum term insurance rates shown on page 4 are based on the
1980 Commissioners Standard Ordinary Mortality (sex and smoker
distinct) Table.
For substandard policy classifications, these values and rates
are based on a modified version of the 1980 CSO Mortality
Table that reflects our mortality experience.
We have filed a detailed statement of the method of
computation with the insurance supervisory official of the
state in which this policy is delivered. The values under this
policy are equal to or greater than those required by the law
of that state.
ANNUAL REPORT Each year we will send you a report showing the current death
benefit, the Cash Value and any outstanding policy loans for
this policy.
It will also show the amount and type of credits to and
deductions from the Cash Value during the past policy year.
The report will also include any other information required by
state laws and regulations.
ILLUSTRATION OF At any time, we will provide an illustration of the future
FUTURE BENEFITS benefits and values under your policy. You must ask in writing
for this illustration. The first illustration in any policy
year will be furnished free of charge. Any subsequent request
in that policy year will be subject to a service fee set by
us.
17
<PAGE>
METHODS OF PAYMENT
Unless otherwise requested, we may pay the insurance proceeds
when the insured dies, or the Cash Surrender Value on
surrender or on the Final Date of the policy, in one sum, or
by placing the amount in an account that earns interest. The
payee will have immediate access to all or part of the
account. If requested, we will apply the amount under one or
more of the following payment plans:
OPTION 1. Interest Income -- The amount applied will earn interest which
will be paid monthly. Withdrawals of at least $500 each may be
made at any time by written request.
OPTION 2. Installment Income for a Stated Period -- Monthly installment
payments will be made so that the amount applied, with
interest, will be paid over the period chosen (from 1 to 30
years).
OPTION 2A. Installment Income of a Stated Amount -- Monthly installment
payments of a chosen amount will be made until the entire
amount applied, with interest, is paid.
OPTION 3. Single Life Income -- Guaranteed Payment Period -- Monthly
payments will be made during the lifetime of the payee with a
chosen guaranteed payment period of 10, 15 or 20 years.
OPTION 3A. Single Life Income -- Guaranteed Return -- Monthly payments
will be made during the lifetime of the payee. If the payee
dies before the total amount applied under this plan has been
paid, the remainder will be paid in one sum as a death
benefit.
OPTION 4. Joint and Survivor Life Income -- Monthly payments will be
made jointly to two persons during their lifetime and will
continue during the remaining lifetime of the survivor. A
total payment period of 10 years is guaranteed.
OTHER Instead of monthly payments, you may choose to have payments
FREQUENCIES made quarterly, semiannually or annually. Other payment plans
AND PLANS may be arranged with us.
CHOICE OF A choice of a payment plan for insurance proceeds made by you
PAYMENT in writing and recorded by us while the insured is alive will
PLANS take effect when the insured dies. All other choices of
payment plans will take effect when recorded by us or later,
if requested. When a payment plan starts, we will issue a
contract which will describe the terms of the plan. We may
require that you send us this policy. We may also require
proof of the payee's age.
Payment plans may be chosen:
(1) by you during the lifetime of the insured; or
(2) by the beneficiary within one year after the insured
died and before any payments have been made, if no
choice was in effect on the date of death.
A choice of a payment plan will not take effect unless each
payment under the plan would be at least $50.
LIMITATIONS If the payee is not a natural person, the choice of a payment
plan will be subject to our approval. An assignment will
modify a prior choice of payment plan. The amount due the
assignee will be payable in one sum and the balance will be
applied under the payment plan.
Payments may not be assigned and, to the extent permitted by
law, will not be subject to the claims of creditors.
PAYMENT PLAN Amounts applied under the interest income and installment
RATES payment plans will earn interest at a rate we set from time to
time.
Life income plan payments will be based on a rate set by us
and in effect on the date the insurance proceeds or cash value
become payable.
18
<PAGE>
METHODS OF PAYMENT (CONTINUED)
MINIMUM PAYMENTS UNDER PAYMENT PLANS -- Monthly payments under Options 2, 3, 3A
and 4 for each $1,000 applied will not be less than the amounts shown in the
following Tables.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------
OPTION 2. Installment Income for a Stated Period
Monthly Payments for each $1,OOO Applied.
- --------------------------------------------------------------------------------------------------------------------
Years chosen Minimum Amount of Minimum Amount Minimum Amount
Each Monthly Years of Each Monthly Years of Each Monthly
Payment Chosen Payment Chosen Payment
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1 $84.47 11 $8.86 21 $5.32
2 42.86 12 8.24 22 5.15
3 28.99 13 7.71 23 4.99
4 22.06 14 7.26 24 4.84
5 17.91 15 6.87 25 4.71
6 15.14 16 6.53 26 4.59
7 13.16 17 6.23 27 4.47
8 11.68 18 5.96 28 4.37
9 10.53 19 5.73 29 4.27
10 9.61 20 5.51 30 4.18
- --------------------------------------------------------------------------------------------------------------------
To determine the minimum amount for quarterly payment multiply the above
monthly payment by 2.99; for semiannual by 5.96; and for annual by 11.84.
- --------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
OPTION 3. Single Life Income -- Guaranteed Payment Period OPTION 3A.
Minimum Amount of each Monthly Payment for each $1,000 Applied
Single Life Income --
--------------------------------------------------------------------------------- Guaranteed Return
Guaranteed Payment Period
--------------------------------------------------------------------------------- Minimum Amount of each
Payee's 10 years 15 years 20 years Monthly Payment for each
Age $1,000 Applied
- -----------------------------------------------------------------------------------------------------------------------------
Male Female Male Female Male Female Male Female
- -----------------------------------------------------------------------------------------------------------------------------
50 $ 3.63 $3.41 $3.61 $3.40 $ 3.57 $3.38 $3.52 $3.34
55 3.90 3.63 3.86 3.61 3.81 3.57 3.75 3.52
60 4.24 3.90 4.17 3.86 4.08 3.81 4.02 3.75
65 4.67 4.24 4.55 4.17 4.39 4.08 4.37 4.02
70 5.23 4.77 5.01 4.64 4.70 4.45 4.79 4.44
75 5.93 5.36 5.50 5.10 4.99 4.77 5.33 4.89
80 6.75 6.25 5.97 5.69 5.20 5.08 5.99 5.58
85 and over 7.60 7.09 6.33 6.13 5.31 5.25 6.81 6.30
- -----------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
OPTION 4. Joint and Survivor Life Income -- Guaranteed Period of 10 years
Minimum Amount of each Monthly Payment for each $1,000 Applied
- ----------------------------------------------------------------------------------------------------------
Age of One Male and Two Two
Both Payees One Female Males Females
- ----------------------------------------------------------------------------------------------------------
50 $3.19 $3.28 $3.13
55 3.36 3.48 3.28
60 3.58 3.72 3.48
65 3.86 4.05 3.72
70 4.23 4.48 4.05
75 4.79 5.06 4.59
- ----------------------------------------------------------------------------------------------------------
</TABLE>
On request, we will provide additional information about amounts of minimum
payments.
19
<PAGE>
NOTICE
When you write to us, please give us your name, address and
policy number. Please notify us promptly of any changes. We
will write to you at your last known address.
Checks, drafts or money orders may be drawn to the order of
Metropolitan Life (or "Met Life"). They are received subject
to the condition that they may be handled for collection in
accordance with the practice of the collecting bank or banks.
If we do not receive the full amount of any check, draft or
money order, it will not constitute payment. All payments are
to be made in U.S. currency. We may refuse to accept any
payments made in a manner that applicable law requires us to
refuse (such as any large cash payment made without
information that we are required by law to obtain.)
VOTING FOR Our Board of Directors is elected by the policyholders. For
DIRECTORS details on how to vote, write to our Secretary.
Metropolitan Life Insurance Company
One Madison Avenue
New York, New York 10010-3690
Countersigned and Delivered on _____________________ By _____________________
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C>
POLICY SPECIFICATIONS 3, 3.1
TABLE OF GUARANTEED
MAXIMUM INSURANCE RATES 4
TABLE OF MAXIMUM
SURRENDER CHARGES 4.1
DESCRIPTION OF
INVESTMENT DIVISIONS IN
THE SEPARATE ACCOUNT 5
DEFINITIONS 6
PAYMENT WHEN INSURED DIES 7
Insurance Proceeds 7
Death Benefit 7
Alternative Death Benefit 7
Guaranteed Minimum
Death Benefit 8
Death Benefit Adjustment 8
MONTHLY DEDUCTION 9
Cost of Term Insurance 9
FIXED ACCOUNT 10
Value 10
Interest Rate 10
SEPARATE ACCOUNT 11
Investment Divisions 11
Our Right to Make Changes 11
Value 12
OWNERS RIGHT TO
CHANGE ALLOCATION 13
Exchange Privilege 13
PAYMENTS DURING INSURED'S
LIFETIME 13
Payment on Final
Date of Policy 13
Full and Partial
Cash Withdrawal 13
Surrender Charges 14
Policy Loan 14
Loan Repayment 14
Effect of a Policy Loan
on the Cash Value 14
Deferment 15
PREMIUMS 15
Premium Payments 15
Limits 15
Grace Period 15
Reinstatement 16
OWNERSHIP AND BENEFICIARY 16
Owner 16
Change of Ownership 16
Beneficiary 16
How to Change the Owner
or the Beneficiary 16
Collateral Assignment 16
EXCLUSION 16
Suicide 16
GENERAL PROVISIONS 17
The Contract 17
Limitation on
Representative's or Other
Person's Authority 17
Incontestability 17
Age and Sex 17
Nonparticipation 17
Computation of Values 17
Annual Report 17
Illustration of Future
Benefits 17
METHODS OF PAYMENT 18
Options 18
Other Frequencies
and Plans 18
Choice of Payment Plans 18
Limitations 18
Payment Plan Rates 18
Minimum Payments under
Payment Plans 19
</TABLE>
- --------------------------------------------------------------------------------
Page 2 has intentionally been left blank.
- --------------------------------------------------------------------------------
Any riders for additional benefits follow page 19.
FLEXIBLE PREMIUM MULTIFUNDED LIFE INSURANCE POLICY
Life insurance payable if the Insured dies before the Final Date of Policy.
Cash value, if any, less any policy loan and loan interest, payable on the Final
Date.
Adjustable death benefit.
Premiums payable while the insured is alive and before the Final Date of Policy.
Premiums must be sufficient to keep the policy in force.
Not eligible for dividends.
<PAGE>
EXHIBIT 8
POWER OF ATTORNEY
-----------------
James P. Bossert
Officer
KNOW ALL MEN BY THESE PRESENTS, that I, an officer of Metropolitan Life
Insurance Company, do hereby appoint Gary A. Beller, Louis J. Ragusa, Richard G.
Mandel and Christopher P. Nicholas, and each of them severally, my true and
lawful attorney-in-fact, for me and in my name, place and stead to execute and
file any instrument or document to be filed as part of or in connection with or
in any way related to the Registration Statements and any and all amendments
thereto, filed by said Company under the Securities Act of 1933 and/or the
Investment Company Act of 1940, in connection with Metropolitan Life Separate
Account UL, Metropolitan Life Separate Account E, The New England Variable
Account, New England Variable Annuity Fund I or New England Retirement
Investment Account of said Company, and to have full power and authority to do
or cause to be done in my name, place and stead each and every act and thing
necessary or appropriate in order to effectuate the same, as fully to all
intents and purposes as I might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact or any of them, may do or cause to be
done by virtue hereof. Each said attorney-in-fact shall have power to act
hereunder with or without the others.
IN WITNESS WHEREOF, I have hereunto set my hand this 20th day of February,
----
1998.
/s/ James P. Bossert
--------------------
Signature
