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Registration No. 33-45122
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-4
REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OF 1933
Post-Effective Amendment No. 7
and
REGISTRATION STATEMENT UNDER THE INVESTMENT
COMPANY ACT OF 1940
Amendment No. 7
PANORAMA PLUS SEPARATE ACCOUNT
------------------------------
(Exact Name of Registrant)
C.M. LIFE INSURANCE COMPANY
---------------------------
(Name of Depositor)
140 Garden Street, Hartford, CT 06154
-------------------------------------
(Address of Depositor's Principal Executive Offices)
Depositor's Telephone Number, including Area Code: 1-800-234-5606
Ann F. Lomeli, Secretary
------------------------
C.M. Life Insurance Company
140 Garden Street
Hartford, Connecticut 06154
Approximate date of proposed public offering: Continuous.
It is proposed that this filing will become effective (check appropriate box)
/ / immediately upon filing pursuant to paragraph (b) of Rule 485
/X/ on May 1, 1997 pursuant to paragraph (b) of Rule 485
/ / 60 days after filing pursuant to paragraph (a) of Rule 485
/ / on (date) pursuant to paragraph (a) of the Rule 485
STATEMENT PURSUANT TO RULE 24f-2
The Registrant has registered an indefinite number or amount of its variable
annuity contracts under the Securities Act of 1933 pursuant to Rule 24f-2 under
the Investment Company Act of 1940. The Rule 24f-2 Notice for Registrant's
fiscal year ended December 31, 1996 was filed on or about February 28, 1997.
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CROSS REFERENCE TO ITEMS
REQUIRED BY FORM N-4
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N-4 Item Caption in Prospectus
- -------- ---------------------
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1........................................ Cover Page
2........................................ Definitions
3........................................ Table of Fees and Expenses
4........................................ Condensed Financial
Information; Performance
Measures
5........................................ C.M. Life and the Separate
Account
6........................................ Contract Charges;
Distribution
7........................................ Miscellaneous Provisions;
An Explanation of the
Contracts; Reservation of
Rights; Contract Owner's
Voting Rights
8........................................ The Annuity (Pay-Out)
Period
9........................................ The Death Benefit
10....................................... The Accumulation (Pay-In)
Period; Distribution
11....................................... Right to Return Contract;
Redemption Privilege
12....................................... Federal Tax Status
13....................................... None
14....................................... Additional Information
</TABLE>
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<TABLE>
<CAPTION>
Caption in Statement of
Additional Information
----------------------
<S> <C>
15....................................... Cover Page
16....................................... Table of Contents
17....................................... General Information
18....................................... Service Arrangements and
Distribution
19....................................... Performance Measures
20....................................... Contract Value Calculations
21....................................... Reports of Independent
Accountants and Financial
Statements
</TABLE>
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THE PANORAMA PLUS VARIABLE ANNUITY
Issued by
C.M. LIFE INSURANCE COMPANY
140 Garden Street, Hartford, CT 06154
This Prospectus describes the Panorama Plus variable annuity (the "Contract"), a
group and individual flexible premium deferred annuity offered by C.M. Life
Insurance Company ("C.M. Life"). The Contract is designed to aid in long-term
financial planning, and provides for the accumulation of capital by individuals
on a tax-deferred basis for retirement or other long-term purposes. The Contract
may be purchased with a minimum initial Purchase Payment of $500. The Contract
Owner generally may make additional Purchase Payments of at least $50 each at
any time before the Annuity Income Date. Additional limitations on Purchase
Payments apply.
The Contract Owner may allocate Purchase Payments to one or more Sub-Accounts of
the Panorama Plus Separate Account (the "Separate Account"), in which Contract
Balances accumulate on a variable basis, or to the General Account, in which
Contract Balances accumulate on a fixed basis, subject to an Interest Rate
Factor Adjustment, or to a combination of these Investment Accounts. The
Separate Account currently has six (6) different Sub-Accounts (the
"Sub-Accounts"). Assets of each Sub-Account are invested in a corresponding
investment portfolio ("Portfolio") of an underlying mutual fund ("Fund")
available for use with variable annuity and variable life insurance products.
Currently, the Portfolios available under the Contract are: the Oppenheimer
Money Fund ("Money Portfolio") and the Oppenheimer Bond Fund ("Bond Portfolio")
of the Oppenheimer Variable Account Funds ("OVAF") and the Government Securities
Portfolio, the Total Return Portfolio, the Growth Portfolio, and the
International Equity Portfolio of the Panorama Series Fund, Inc. ("Panorama
Fund"). Each Portfolio is described in a separate prospectus for each Fund that
accompanies this Prospectus.
The Contract Balance allocated to the Separate Account will vary in accordance
with the investment performance of the Portfolio selected by the Contract Owner.
Therefore, the Contract Owner bears the entire investment risk for all amounts
allocated to the Separate Account. The Contract Owner may also bear investment
risk with respect to Surrenders (and the election of payments of Annuity Income)
from the General Account. Thus, investment in the Contract is subject to risk
that may cause the value of the Contract Owner's investment to fluctuate, and
when the contract is surrendered, the value may be higher or lower than the
aggregate purchase payments.
This Prospectus sets forth your rights under the Contract, and information
regarding the Separate Account and the General Account that investors should
know before investing. Please read it carefully and retain for future reference.
A Statement of Additional Information, dated May 1, 1997, has been filed with
the Securities and Exchange Commission ("SEC"), and is available without charge,
upon written request, or by calling the Annuity Service Center. The Statement of
Additional Information, as supplemented from time to time, is incorporated
herein by reference.
THIS PROSPECTUS MUST BE ACCOMPANIED OR PRECEDED BY THE PROSPECTUS FOR THE
PANORAMA SERIES FUND, INC. AND OPPENHEIMER VARIABLE ACCOUNT FUNDS, WHICH ARE
ATTACHED HERETO.
THE CONTRACTS DESCRIBED IN THIS PROSPECTUS ARE NOT DEPOSITS OR OBLIGATIONS OF,
OR GUARANTEED OR ENDORSED BY, ANY BANK AND ARE NOT FEDERALLY INSURED BY THE
FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER
AGENCY.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING IN ANY JURISDICTION IN WHICH
SUCH OFFERING MAY NOT LAWFULLY BE MADE. NO DEALER, SALESPERSON OR OTHER PERSON
IS AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY REPRESENTATIONS IN CONNECTION
WITH THIS OFFERING OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS, AND, IF GIVEN
OR MADE, SUCH OTHER INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
----------------------------------------
Annuity Service Center, H305
P.O. Box 9067
Springfield, MA 01101
1-800-234-5606
The date of this Prospectus is May 1, 1997.
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Table Of Contents
<TABLE>
<CAPTION>
Page
<S> <C>
DEFINITIONS.......................................................................... 4
SUMMARY.............................................................................. 6
TABLE OF FEES AND EXPENSES........................................................... 9
CONDENSED FINANCIAL INFORMATION...................................................... 10
C.M. LIFE INSURANCE COMPANY.......................................................... 10
THE PANORAMA PLUS VARIABLE ANNUITY CONTRACT.......................................... 11
Contract Application and Issuance of Contracts................................. 11
Electronic Data Transmission of Application Information.............. 11
Purchase Payments.............................................................. 11
Initial Purchase Payment............................................. 11
Additional Purchase Payments......................................... 11
Allocation of Purchase Payments...................................... 11
Payment Not Honored by Bank.......................................... 12
Contract Balance............................................................... 12
The Separate Account Balance......................................... 12
The General Account Balance.......................................... 12
Minimum Contract Balance............................................. 12
PANORAMA PLUS INVESTMENT ACCOUNTS.................................................... 12
The Separate Account........................................................... 12
The General Account............................................................ 14
Transfers...................................................................... 14
Dollar Cost Averaging.......................................................... 15
DISTRIBUTIONS UNDER THE CONTRACT..................................................... 16
Surrenders..................................................................... 16
Systematic Withdrawals......................................................... 16
Annuity Income Payments........................................................ 17
Annuity Income Date.................................................. 17
Election of Annuity Option........................................... 17
Premium Tax.......................................................... 17
Annuity Options................................................................ 17
Terminal Illness Benefit....................................................... 18
Death Benefit.................................................................. 19
Death of Contract Owner.............................................. 19
Death of Contract Owner/Annuitant.................................... 19
Death of Annuitant................................................... 19
Death Benefit Options................................................ 20
Death of Annuitant On or After Annuity Income Date................... 20
Beneficiary.......................................................... 20
IRS Required Distribution...................................................... 20
Restrictions Under the Texas Optional Retirement Program....................... 20
Restrictions Under Section 403(b) Plans........................................ 21
CHARGES AND DEDUCTIONS............................................................... 21
Surrender Charge............................................................... 21
Interest Rate Factor Adjustment................................................ 22
Mortality and Expense Risk Charge.............................................. 22
Administrative Charges......................................................... 22
Contract Maintenance Fee............................................. 22
Administrative Expense Charge........................................ 22
Premium Taxes.................................................................. 22
Federal, State and Local Taxes................................................. 23
</TABLE>
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<TABLE>
<S> <C>
Other Expenses Including Investment Advisory Fees................................ 23
DISTRIBUTOR OF THE CONTRACTS........................................................... 23
GENERAL PROVISIONS..................................................................... 23
Assignment of the Contract....................................................... 23
Contract Changes by C.M. Life.................................................... 23
Contract Termination............................................................. 23
Incontestability................................................................. 23
Misstatement of Age or Sex....................................................... 23
Nonparticipating................................................................. 23
Non-Business Days................................................................ 24
Regulatory Requirements.......................................................... 24
Right to Examine Contract........................................................ 24
TAX STATUS............................................................................. 24
General.......................................................................... 24
Diversification.................................................................. 24
Multiple Contracts............................................................... 25
Tax Treatment of Assignments..................................................... 25
Income Tax Withholding........................................................... 25
Tax Treatment of Withdrawals - Non-Qualified Contracts........................... 25
Penalty Tax...................................................................... 25
Qualified Plans.................................................................. 25
Qualified Pension and Profit Sharing Plans.................................. 26
Individual Retirement Annuities and Individual Retirement Accounts.......... 26
Tax-Sheltered Annuities..................................................... 26
Section 457 Deferred Compensation ("Section 457") Plans..................... 26
Tax Treatment of Withdrawals - Qualified Contracts.......................... 26
Restrictions under Qualified Contracts...................................... 27
General.......................................................................... 27
ADDITIONAL INFORMATION ABOUT THE SEPARATE ACCOUNT...................................... 27
Addition, Deletion or Substitution of Investments................................ 27
PERFORMANCE MEASURES................................................................... 28
Standard Average Annual Total Return............................................. 28
Additional Performance Measures.................................................. 28
VOTING RIGHTS.......................................................................... 29
LEGAL PROCEEDINGS...................................................................... 29
AVAILABLE INFORMATION.................................................................. 29
APPENDIX I - SURRENDER CHARGE CALCULATION.............................................. 30
APPENDIX II - INTEREST RATE FACTOR ADJUSTMENT CALCULATION.............................. 31
APPENDIX III - EXAMPLES................................................................ 34
APPENDIX IV - INDIVIDUAL RETIREMENT ANNUITY DISCLOSURE................................. 35
STATEMENT OF ADDITIONAL INFORMATION TABLE OF CONTENTS.................................. 38
</TABLE>
3
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Definitions
Accumulation Period: The period from the Contract Issue Date through the day
preceding the Annuity Income Date.
Accumulation Unit: A unit of measure used to determine the value of the Separate
Account Balance during the Accumulation Period.
Annuitant: The person upon whose life the Annuity Income payments are to be
made. On or after the Annuity Income Date, the Annuitant shall also include any
Joint Annuitant selected in accordance with Annuity Income Options.
Annuity Income: The payments that will begin on the Annuity Income Date. The
amount of Annuity Income payments will be based on the Contract Balance and the
age(s) and sex(es) of the Annuitant (and Joint Annuitant, if Annuity Option C or
D is elected), as well as on the Annuity Option selected.
Annuity Income Date: The date on which the Annuity Income payments begin. The
earliest Annuity Income Date that may be elected is the fifth anniversary of the
Contract Issue Date. The latest Annuity Income Date that may be elected is the
Annuitant's 85th birthday.
Annuity Options: Options available for payment of Annuity Income.
Annuity Period: The period which begins on the Annuity Income Date and ends with
the last Annuity Income payment.
Annuity Service Center: Notices, Written Requests, and Purchase Payments under
the Contract must be sent to the Annuity Service Center, the address of which is
140 Garden Street, Mail Station 305, Hartford, CT 06123, telephone number
1-800-234-5606. All sums payable by C.M. Life under the Contract are payable
only at the Annuity Service Center.
Annuity Unit: A unit of measure used to determine the amount of each Variable
Annuity Income payment.
Application: The document signed by the Contract Owner that evidences the
Contract Owner's application for the Contract.
Beneficiary: The person(s) designated to receive the Death Benefit provided
under the Contract.
Code: The Internal Revenue Code of 1986, as amended.
Contingent Annuitant: The person designated to receive all of the benefits
otherwise due the Annuitant if the Annuitant dies before the Annuity Income
Date, provided such person is less than 85 years of age on the Annuitant's date
of death.
Contract: The Panorama Plus individual flexible premium deferred annuity
contract, or the individual certificate issued under a Panorama Plus group
flexible premium deferred annuity contract, that is described in this
Prospectus.
Contract Balance(s): The sum of the General Account Balance and the Separate
Account Balance.
Contract Issue Date: The date on which the Contract becomes effective.
Contract Owner: The person or entity entitled to the ownership rights stated in
the Contract.
Contract Year: The first Contract Year is the annual period which begins on the
Contract Issue Date. Subsequent Contract Years begin on each anniversary of the
Contract Issue Date.
Five-Year Period: Any of the successive five-year periods which begin on the
date of the initial Purchase Payment to the General Account.
Fixed Annuity: An annuity with payments that do not vary as to dollar amount.
Funds: The Separate Account invests in shares of various investment Portfolios
of two mutual funds ("Funds"): the Panorama Series Fund, Inc. ("Panorama Fund")
and the Oppenheimer Variable Account Funds ("OVAF"). Both Funds are diversified,
open-end management investment companies. The following six (6) Portfolios are
available under the Contract: the Oppenheimer Money Fund ("Money Portfolio") and
the Oppenheimer Bond Fund ("Bond Portfolio") of OVAF, and the Government
Securities Portfolio, the Total Return Portfolio, the Growth Portfolio, and the
International Equity Portfolio of the Panorama Fund. Each Portfolio is managed
for investment purposes as if it were a separate investment company issuing its
own shares.
General Account: The portion of the Contract, if any, which is credited with a
specified interest rate, and which is held as part of the general assets of C.M.
Life and not as part of the Separate Account.
General Account Balance: The value of the General Account during the
Accumulation Period.
Guaranteed Interest Rate: The effective annual interest rate which C.M. Life
will credit on the General Account Balance. The Guaranteed Interest Rate will be
reset quarterly in the sole discretion of C.M. Life, and will never be less than
3%. Although this minimum interest rate is guaranteed, there is no guaranteed
Surrender Value.
Investment Accounts: The General Account and Separate Account available for
Purchase Payments under the Contract.
Net Purchase Payment: A Purchase Payment less any Premium Tax.
Premium Tax: A tax imposed by certain states when a Purchase Payment is made,
when Annuity Income begins, or when the Contract is Surrendered.
Purchase Payment: A deposit made to the Contract.
Revision Date: The date of any revised Contract schedule. A revised Contract
schedule bearing the latest Revision Date will supersede all previous Contract
schedules.
Separate Account: C.M. Life's Panorama Plus Separate Account, which consists of
assets set aside by C.M. Life, the
4
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investment performance of which is kept separate from that of the general assets
and all other separate account assets of C.M. Life.
Separate Account Balance: The value of the Separate Account during the
Accumulation Period.
Sub-Account: Separate Account assets are divided into Sub-Accounts which are
listed in the Contract Schedule. Assets of each Sub-Account will be invested in
shares of a corresponding Portfolio or Fund. C.M. Life reserves the right to
eliminate or add Sub-Accounts and to change investment companies, or to
substitute other investments for Fund shares, in accordance with the applicable
provisions of the Investment Company Act of 1940, as amended.
Surrender: An election in the form of a Written Request by the Contract Owner
made prior to the Annuity Income Date and before a Death Benefit has become
payable, to withdraw all or a portion of the Contract Balance in exchange for a
cash payment.
Surrender Value: The proceeds payable upon a Surrender of the Contract, equal to
the Contract Balance (a) minus any applicable Surrender Charge, (b) minus the
Contract Maintenance Fee, (c) minus any applicable Premium Tax, and (d) plus or
minus any applicable interest Rate Factor Adjustment. There is no guaranteed or
minimum Surrender Value.
Treasury Index Rates: The annual interest rates payable on U.S. Treasury
securities with 1-year, 2-year, 3-year, and 5-year maturities, published weekly
by the Federal Reserve. Index Rates for intermediate periods shall be
interpolated from the applicable interest rates.
Valuation Date: Every day on which C.M. Life and the New York Stock Exchange
("NYSE") are open for business, except any day on which trading on the NYSE is
restricted, or on which an emergency exists, as determined by the Securities and
Exchange Commission ("SEC"), or respective governing bodies of the NYSE so that
valuation or disposal of securities is not practicable.
Valuation Period: The period of time beginning on the day following any
Valuation Date and ending on the next Valuation Date. A Valuation Period may be
more than one day.
Variable Annuity: An annuity with payments which vary as to dollar amount in
relation to the investment performance of specified Sub-Accounts of the Separate
Account.
Window Period: The last thirty (30) days of each Five-Year Period. During a
Window Period, part or all of the General Account Balance may be transferred to
any Sub-Account of the Separate Account or surrendered without incurring a
Surrender Charge or an Interest Rate Factor Adjustment. Also, part or all of the
Separate Account Balance may be surrendered without incurring a Surrender Charge
during the Window Period.
Written Request: A request in writing, in a form satisfactory to C.M. Life,
which is received by the Annuity Service Center.
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THE PANORAMA PLUS ANNUITY
Summary
The Contract
The Panorama Plus Annuity is an individual and group flexible premium deferred
variable annuity which can be purchased on a non-tax-qualified basis
("Non-qualified Contract") or with the proceeds from certain plans qualifying
for favorable federal income tax treatment ("Qualified Contract"). The Contract
Owner allocates Purchase Payments among two Investment Accounts of C.M. Life:
the Panorama Plus Separate Account (the "Separate Account") and the General
Account.
Purchase Payments
A Contract may be purchased with a minimum initial Purchase Payment of at least
$500. From time to time, this minimum initial Purchase Payment may be changed.
The Contract Owner may make additional Purchase Payments of at least $50 each at
any time before the Annuity Income Date. Subsequent Purchase Payments allocated
to the General Account are limited in amount, based in part on prior Purchase
Payment allocations to that Account. (See Purchase Payments).
The Panorama Plus Investment Accounts
On the Contract Issue Date, the initial Net Purchase Payment is allocated among
the Investment Accounts (that is, among the General Account and/or the
Sub-Accounts of the Separate Account) in accordance with the allocation
percentages specified by the Contract Owner in the Application. Allocation
changes for subsequent Purchase Payments may be made by sending a Written
Request to the Annuity Service Center. Allocation changes will be effective when
the Annuity Service Center receives a Written Request in good order.
The Separate Account. The Separate Account, a separate account of C.M. Life,
invests in shares of various investment Portfolios of two mutual funds
("Funds"): the Panorama Series Fund, Inc. ("the Panorama Fund") and the
Oppenheimer Variable Account Funds ("OVAF"). In addition to the Money Fund and
the Bond Fund of OVAF, four (4) Portfolios of the Panorama Fund are currently
available under the Contract: the Government Securities Portfolio, the Total
Return Portfolio, the Growth Portfolio, and the International Equity Portfolio.
Each of the six Sub-Accounts of the Separate Account invests solely in a
corresponding Portfolio or Fund. Because the Separate Account Balance will
increase or decrease depending on the investment experience of the selected
Sub-Accounts, the Contract Owner bears the entire investment risk with respect
to Purchase Payments allocated to, and amounts transferred to, the Separate
Account. (See The Separate Account).
The General Account. The General Account provides for fixed accumulations and a
specified interest rate on Purchase Payments allocated to, and amounts
transferred to, the General Account. The interest rate will be reset
periodically, currently quarterly, at the sole discretion of C.M. Life. The
General Account Balance may be subject to an Interest Rate Factor Adjustment
upon Surrender and on the Annuity Income Date. (See Interest Rate Adjustment
Factor). The Interest Rate Factor Adjustment does not apply to Contracts issued
to Pennsylvania residents. Because of this adjustment and for other reasons, the
amount payable upon Surrender, or applied to Annuity Income payments, may be
more or less than the General Account Balance at that time, and more or less
than the total Purchase Payments allocated to and amounts transferred to the
General Account. Thus, the Contract Owner is subject to some investment risk
with respect to the General Account Balance. (See The General Account).
Transfers
The Contract Owner may transfer amounts from one Investment Account or
Sub-Account to another Investment Account or Sub-Account, with certain
limitations, during the Accumulation Period (i.e., prior to the Annuity Income
Date). The Beneficiary may exercise this right if a Death Benefit has become
payable. The minimum transfer amount is $100. In addition, the total of all
transfers to or from the General Account during any Contract Year is limited to
the greater of (a) 30% of the General Account Balance as of the end of the
immediately preceding Contract Year, or (b) $25,000. Additional limitations
apply to transfers to or from the General Account and the Money Sub-Account.
(See Transfers).
During the Annuity Period (i.e., after the Annuity Income Date), a portion of
the Separate Account Balance may be transferred from one Sub-Account to any
other Sub-Account once during any Contract Year. Transfers to or from the
General Account are not permitted during the Annuity Period. (See Transfers).
Dollar Cost Averaging
There are three Dollar Cost Averaging options available to the Contract Owner.
First, the Contract Owner may elect to transfer fixed dollar amounts at regular
intervals from one Sub-Account to another Sub-Account, and to change the fixed
dollar amount and the Sub-Accounts selected. As a second option, the Contract
Owner may elect to transfer fixed dollar amounts from the General Account to
Sub-Accounts (other than the Money Market Sub-Account). Total transfers from the
General Account are limited in the Contract Year of the initial Purchase Payment
to the greater of: (i) 30% of the initial Purchase Payment; or (ii) $25,000. In
subsequent Contract Years, total transfers from the General Account are limited
to the greater of: (i) 30% of the General Account Balance as of the end of the
immediately preceding Contract Year; or (ii) $25,000. The timing of the election
of this option is restricted. As a third option, the Contract Owner may elect to
transfer the credited interest of the General Account at specified intervals to
one or more of the Sub-Accounts (other than the Money Market Sub-Account). A
General Account Balance of at least $5,000 must be available at the time of each
transfer. Only one Dollar Cost Averaging option may be in effect at any one
time.
There currently is no charge for Dollar Cost Averaging. However, the Company
reserves the right to charge for Dollar Cost Averaging in the future. The
Contract Owner may not simultaneously participate in both Dollar Cost Averaging
and Systematic Withdrawals. Changes in the Dollar Cost Averaging option may only
be made by Written Request from the Contract Owner to terminate the existing
Dollar Cost Averaging option, accompanied by a Written Request identifying the
new Dollar
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Cost Averaging option selected. For more details see Dollar Cost Averaging
further along in this prospectus.
Surrenders
The Contract Owner may elect to Surrender all or a portion ($100 minimum per
partial surrender) of the Contract Balance in exchange for a cash payment from
C.M. Life at any time during the Accumulation Period and prior to payment of the
Death Benefit. Following any partial Surrender, the Contract Balance must be at
least $250. Partial Surrenders may be withdrawn from both the General Account
Balance and the Separate Account Balance. Partial and full Surrenders are
subject to any applicable Surrender Charge, Interest Rate Factor Adjustment, and
Contract Maintenance Fee. There is currently no limit on the frequency or timing
of Surrenders. (See Surrenders) Please note, federal income taxes and a tax
penalty may be applicable. (See Tax Status.)
There is no guaranteed or minimum Surrender Value, so regardless of the extent
to which Purchase Payments are allocated to the Separate Account or to the
General Account, the proceeds of a full Surrender (that is, the Surrender Value)
could be less than the total Purchase Payments.
Systematic Withdrawals
Upon Written Request, the Contract Owner may elect Systematic Withdrawals ($100
minimum per withdrawal) to begin on or after the first anniversary of the
Contract Issue Date during the Accumulation Period. There is currently no charge
for Systematic Withdrawals. However, the Company reserves the right to charge
for Systematic Withdrawals in the future. The Contract Owner may not
simultaneously participate in both Systematic Withdrawals and Dollar Cost
Averaging.
Systematic Withdrawals changes may only be made by Written Request from the
Contract Owner to terminate the existing Systematic Withdrawals program
accompanied by a Written Request identifying the new Systematic Withdrawals
election.
Systematic Withdrawals may result in tax liabilities. See Tax Status.
Terminal Illness Benefit
In the event that a Contract Owner becomes terminally ill during the
Accumulation Period and prior to age 75, the Contract Owner may elect, unless
prohibited by law, by submission of a Written Request, a Terminal Illness
Benefit equal to the greater of (a) the Purchase Payments less any prior
withdrawals and charges; or (b) the Contract Balance. (See Terminal Illness
Benefit.)
Death Benefit
In the event that the Contract Owner or Annuitant dies prior to the Annuity
Income Date, a Death Benefit is payable upon receipt of satisfactory proof of
death of the Contract Owner or the Annuitant, an election of the Death Benefit
Option and return of the Contract. The Death Benefit will at least equal the
Contract Balance at the time of payment. No Surrender Charge, Interest Rate
Factor Adjustment, or Contract Maintenance Fee is imposed upon amounts received
as a Death Benefit. (If the Annuitant dies before the Contract Owner and there
is a Contingent Annuitant who is less than 85 years of age on the Annuitant's
date of death, and such Contract Owner is a natural person, no Death Benefit is
payable, and the Contract continues in force, with the Contingent Annuitant
becoming the Annuitant.) (See Death Benefit.)
Charges and Deductions
Surrender Charge. To help defray sales expenses a 5% Surrender Charge will be
deducted from the Contract Balance in the event of any partial or full Surrender
during the first five (5) Contract Years. However, beginning in the second
Contract Year, a Free Surrender Amount, equal to 10% of the Contract Balance as
of the end of the immediately preceding Contract Year, will be exempt from any
Surrender Charge (and any Interest Rate Factor Adjustment see below). In
addition, no Surrender Charge or Interest Rate Factor Adjustment is imposed on
partial or full Surrenders during the Window Period, which is the last thirty
(30) days of each Five-Year Period. C.M. LIFE GUARANTEES THAT THE AGGREGATE
SURRENDER CHARGE WILL NEVER EXCEED 8.5% OF THE TOTAL PURCHASE PAYMENTS MADE
UNDER THE CONTRACT. (See Surrender Charge.)
Interest Rate Factor Adjustment. An Interest Rate Factor Adjustment may be
applied in the event of any partial or full Surrender of the General Account
Balance during the Accumulation Period, and on the Annuity Income Date (if the
General Account Balance is applied to a Variable Annuity Option). The Interest
Rate Factor Adjustment does not apply to amounts invested in the Separate
Account or to Contracts issued to Pennsylvania residents.
The Interest Rate Factor Adjustment may be positive or negative. It is based on
interest rates payable on U.S. Treasury securities. In general, if rates on U.S.
Treasury securities are higher when you Surrender than when you made the
applicable Purchase Payments (or up to .30% lower), a negative Interest Rate
Factor Adjustment may be applied, and on a full Surrender of your General
Account Balance, you could receive an amount lower than the amount of Purchase
Payments made (even for Purchase Payments allocated to the General Account).
However, if rates on U.S. Treasury securities are more than .30% lower when you
Surrender than when you made the applicable Purchase Payments, a positive
Interest Rate Factor Adjustment may be applied, and on a full Surrender of your
General Account Balance, you could receive an amount higher than the amount of
Purchase Payments made, plus interest. (For partial Surrenders of the General
Account Balance, the Interest Rate Factor Adjustment will be added to or
subtracted from the remaining General Account Balance.) No Interest Rate Factor
Adjustment will be applied during the Window Period; in addition, no Interest
Rate Factor Adjustment will be applied to the General Account Free Surrender
Amount. (See Interest Rate Factor Adjustment.)
Separate Account Charges. C.M. Life deducts a daily charge equal to a percentage
of the net assets in the Separate Account for the mortality and expense risks
assumed by C.M. Life under the Contracts. The effective annual rate of this
charge currently is 1.07%. It may increase but it will not exceed an effective
annual rate of 1.25% of the average daily value
7
<PAGE>
of the Separate Account's net assets. (See Mortality and Expense Risk Charge.)
C.M. Life also deducts a daily Administrative Expense Charge from the net assets
of each of the Sub-Accounts of the Separate Account to partially cover expenses
incurred by C.M. Life in connection with the administration of the Separate
Account and the Contract. This charge is currently at an effective annual rate
of 0.07% and it may increase, but the annual charges for mortality and expense
risks and administrative expenses are guaranteed not to exceed an effective
annual rate of 1.50% of the daily value of the Separate Account's net assets.
(See Administrative Expense Charge.)
Contract Charges. There is also an annual Contract Maintenance Fee imposed each
year for Contract maintenance and related administrative expenses. This charge
is currently $30 per Contract. It will be calculated as a pro rata portion of
the balance of each Sub-Account and the General Account, and deducted from the
Contract Balance on the last day of each Contract Year during the Accumulation
Period, and upon Full Surrender of the Contract. For Contracts issued to
Pennsylvania residents, the Fee will be calculated as a pro rata portion of the
balance of each Sub-Account. The Contract Maintenance Fee may increase but it
will not exceed $60 per Contract Year. (See Contract Maintenance Fee.)
Taxes. C.M. Life may incur Premium Taxes relating to the Contracts. Depending
upon applicable state law, C.M. Life will deduct any Premium Taxes related to a
particular Contract from Purchase Payments, from the Contract Balance upon
Surrender, or on the Annuity Income Date. (See Premium Taxes.) No charges are
currently made against the Sub-Accounts for federal, state, or local taxes other
than Premium Taxes. However, C.M. Life may deduct charges for such taxes in the
future. (See Federal, State and Local Taxes.)
Charges Against the Funds. The value of the net assets of the Sub-Accounts of
the Separate Account will reflect the investment advisory fee and other expenses
incurred by the Portfolios of the Funds.
Expense Data. The charges and deductions explained above are summarized in the
following table. This tabular information regarding expenses assumes that the
entire Contract Balance is in the Separate Account.
Right to Return the Contract
No Surrender Charge will be applied if the Contract Owner returns the Contract
to the Annuity Service Center for cancellation during the first fifteen (15)
calendar days following the Contract Issue Date (or a longer period, if required
by law). Upon return of the Contract during this period, C.M. Life will refund
the Separate Account Balance and any Purchase Payments made to the General
Account. If required by state law, C.M. Life will refund all Purchase Payments
received upon cancellation of the Contract.
Federal Income Tax Consequences of Investment in the Contract
With respect to Contract Owners who are natural persons, there should be no
federal income tax on increases in the Contract Balance (if any) until a
distribution under the Contract occurs (e.g., a Surrender or Annuity Income
payment) or is deemed to occur (e.g., a pledge or assignment of a Contract).
Generally, a portion of any distribution or deemed distribution will be taxable
as ordinary income. The taxable portion of certain distributions will be subject
to withholding unless the recipient elects otherwise. In addition, a penalty tax
may apply to certain distributions or deemed distributions under the Contract,
See Tax Status.)
Inquiries and Written Notices and Requests
Any questions about procedures or the Contract, or any Written Request required
to be directed to C.M. Life, should be sent to Annuity Service Center, Mail
Station 305, P.O. Box 9067 Springfield, MA 01101. Telephone requests and
inquiries may be made by calling 1-800-234-5606. All inquiries and Written
Requests should include the Contract number, the Contract Owner's name and the
Annuitant's name.
Variations in Contract Provisions
Certain provisions of the Contracts may vary from the descriptions in this
Prospectus in order to comply with different state laws. Any such variations
will be included in the Contract itself or in riders or endorsements.
Note: The foregoing summary is qualified in its entirety by the detailed
information in the remainder of this Prospectus, in the Statement of Additional
Information, in the prospectus for each Fund, and in the Contract, all of which
should be referred to for more detailed information. This Prospectus generally
describes only the Contract, the Separate Account and the General Account. A
separate prospectus attached hereto describes each Fund.
8
<PAGE>
Table of Fees and Expenses
<TABLE>
<CAPTION>
<S> <C>
Contract Owner Transaction Expenses/1/
Sales Load On Purchase Payments None
Maximum Surrender
(as a % of Contract Balance Surrendered)........ 5% for Contract Years 1-5 and 0% thereafter.
Annual Contract Maintenance Fee....................... $30 Per Contract
Transfer Fees......................................... Currently No Fee
Separate Account Annual Expenses
(as a percentage of Account value)
Mortality and Expense Risk Charge..................... 1.07%
Administrative Expense Charge......................... 0.07%
Total Separate Account Annual Expenses................ 1.14%
<CAPTION>
Money Government Total International
Market/2/ Securities Income/3/ Return Growth Equity
--------- ---------- --------- ------ ------ -------------
<S> <C> <C> <C> <C> <C> <C>
Portfolio Annual Expenses/4/
(as a percentage of average net assets)
Management Fees........................................ 0.45% 0.53% 0.74% 0.55% 0.57% 1.00%
Other Expenses......................................... 0.04% 0.09% 0.04% 0.00% 0.01% 0.21%
Total Portfolio Annual Expenses........................ 0.49% 0.62% 0.78% 0.55% 0.58% 1.21%
</TABLE>
/1/ In addition to the Contract Owner transaction expenses reflected in the
table, an Interest Rate Factor Adjustment is applied to the amount of
General Account Balance under the Contract subject to full or partial
Surrender during the Accumulation Period, and on the Annuity Income Date (if
the General Account Balance is applied to a Variable Annuity Option), unless
the amount surrendered is a Free Surrender Amount, or the Surrender is made
during a Window Period (the Adjustment does not apply to Contracts issued to
Pennsylvania residents). The Interest Rate Factor Adjustment may increase or
decrease the General Account Balance Surrender proceeds.
/2/ On December 1, 1996, after receiving an order from the SEC approving the
transaction C.M. Life redeemed the shares of the Money Market Portfolio of
the Panorama Fund and purchased shares of the Money Fund of OVAF with the
proceeds.
/3/ On December 1, 1996, after receiving an order from the SEC approving the
transaction, C.M. Life redeemed the shares of the Income Portfolio of the
Panorama Fund and purchased shares of the Bond Fund of OVAF with the
proceeds.
/4/ The Portfolio expenses are actual expenses for each Portfolio for the fiscal
year ended December 31, 1996.
Examples
The Contract Owner would pay the following expenses on a $1,000 investment,
assuming a 5% annual return on assets (and assuming the entire Contract Balance
is allocated to the Separate Account).
1. If the Contract is surrendered at the end of the applicable time period:
<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
<S> <C> <C> <C> <C>
Money Market Sub-Account....................................... $70 $107 $99 $214
Government Securities Sub-Account.............................. $76 $125 $131 $280
Income Sub-Account............................................. $69 $104 $94 $204
Total Return Sub-Account....................................... $72 $113 $109 $235
Growth Sub-Account............................................. $71 $111 $105 $228
International Equity Sub-Account............................... $70 $106 $97 $210
</TABLE>
9
<PAGE>
2. If the Contract is not surrendered or annuitized:
<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
<S> <C> <C> <C> <C>
Money Market Sub-Account........................................... $19 $57 $99 $214
Government Securities Sub-Account.................................. $25 $77 $131 $280
Income Sub-Account................................................. $18 $55 $94 $204
Total Return Sub-Account........................................... $21 $64 $109 $235
Growth Sub-Account................................................. $20 $61 $105 $228
International Equity Sub-Account................................... $18 $56 $97 $210
</TABLE>
The above table and examples are intended to assist the Contract Owner in
understanding the costs and expenses that will be borne, directly or indirectly,
by Purchase Payments allocated to the Separate Account. The table and examples
reflect the charges and expenses anticipated for the Separate Account and
reflect the actual expenses for each Portfolio for the 1995 fiscal year. For a
more complete description of the various charges and expenses described in the
table and examples, see Charges and Deductions, and the prospectus for each
Fund. In addition to the expenses listed above, Premium Taxes may be applicable.
THE EXAMPLES SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
EXPENSES, AND ACTUAL EXPENSES MAY BE GREATER OR LESSER THAN THOSE SHOWN.
Panorama Plus Separate Account Of
C.M. Life Insurance Company
Condensed Financial Information
The audited financial statements for the years ended December 31, 1996 and 1995
are included in the Statement of Additional Information, which is incorporated
by reference in this Prospectus.
ACCUMULATION UNIT VALUES
<TABLE>
<CAPTION>
Dec. 31, Dec. 31, Dec. 31, Dec. 31, Dec. 31,
1992(a) 1992 1993 1994 1995 1996
Sub-Account ------- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Money Market $1.000000 $1.012022 $1.027456 $1.054570 $1.100599 $1.147312
Government Securities $1.000000 $1.061901 $1.158653 $1.095471 $1.281804 $1.293638
Income $1.000000 $1.060916 $1.174260 $1.114759 $1.306525 $1.318102
Total Return $1.000000 $1.058946 $1.217379 $1.186187 $1.460595 $1.586635
Growth $1.000000 $1.064372 $1.276534 $1.258146 $1.711382 $2.014864
International Equity $1.000000 $0.950887 $1.146031 $1.145014 $1.251930 $1.400836
Accumulation Units Outstanding
Money Market 681,553 3,136,932 13,603,045 16,949,501 13,507,122
Government Securities 2,152,739 8,444,505 11,994,574 13,726,057 12,647,811
Income 2,564,029 12,281,025 16,488,930 20,617,764 22,192,539
Total Return 12,316,597 71,182,538 147,324,713 194,679,349 224,734,224
Growth 2,798,378 19,370,204 49,636,052 83,371,008 111,846,534
International Equity 742,623 5,578,969 22,419,639 31,322,974 40,507,658
</TABLE>
(a) Commencement of operations for the Sub-Accounts occurred on May 13, 1992.
C.M. Life Insurance Company
C.M. Life, 140 Garden Street, Hartford, Connecticut 06154, is a stock life
insurance company. It was chartered by a special Act of the Connecticut General
Assembly on April 25, 1980. It is principally engaged in the sale of life
insurance and annuities, and is licensed in all states except New York. C.M.
Life is a wholly-owned subsidiary of Massachusetts Mutual Life Insurance Company
("MassMutual"). MassMutual is a mutual life insurance company specially
chartered by the Commonwealth of Massachusetts on May 14, 1851. It is currently
licensed to transact life (including variable life), accident, and health
insurance business in all states, the District of Columbia, Puerto Rico and
certain provinces of Canada. MassMutual has estimated statutory assets in excess
of $55 billion and estimated total assets under management in excess of $130
billion.
Prior to February 29, 1996, C.M. Life was a wholly-owned subsidiary of
Connecticut Mutual Life Insurance Company
10
<PAGE>
("Connecticut Mutual"). On February
29, 1996, Connecticut Mutual merged with and into MassMutual.
The merger did not affect any provisions of, or rights or obligations under, the
Contracts issued by C.M. Life. For more information about C.M. Life, see
Additional Information About The Separate Account.
The Panorama Plus Variable
Annuity Contract
The Contract is an individual and group flexible premium deferred variable
annuity contract. In certain states the Contract is only available as a group
contract. In these states, a Certificate (also referred to herein as a
"Contract"), which summarizes the provisions of the group contract under which
the Certificate is issued, is issued to individuals. The rights and benefits
under the Contract are summarized below. However, the description of the
Contract contained in this Prospectus is qualified in its entirety by the
Contract itself, a copy of which is available upon request from C.M. Life. The
Contract may be purchased on a non-tax-qualified basis ("Non-qualified
Contract"). The Contract may also be purchased and used in connection with
retirement plans or individual retirement accounts that qualify for favorable
federal income tax treatment ("Qualified Contract").
Group contracts may be issued to any employer, entity, or other group acceptable
to C.M. Life. An eligible member of a group to which a group contract has been
issued may become a participant by completing an Application and forwarding an
initial Purchase Payment to C.M. Life. The rights and benefits of a participant
under a group contract are summarized in a certificate issued to the
participant. Provisions of the group contract are controlling. All rights and
benefits may be exercised by the participant without the consent of the group
contract owner. Unless otherwise stated, the rights and benefits of an owner of
an Individual Panorama Plus Annuity and an owner of a certificate under a group
Panorama Plus Annuity are the same. Accordingly, as used herein, the term
"Contract" means either an individual annuity or a certificate under a group
annuity, depending on the state where it is issued.
There is no guaranteed or minimum Surrender Value under the Contract, so the
amount received on Surrender could be less than the amount of Purchase Payments.
Contract Application and Issuance of Contracts
Before it will issue a Contract, C.M. Life must receive a completed Application,
related forms and an initial Purchase Payment of at least $500. From time to
time, this initial Purchase Payment may be reduced. C.M. Life reserves the right
to reject any Application or Purchase Payment.
If the Application and related forms are properly completed and can be accepted
in the form received, any initial Net Purchase Payment will be credited to the
Contract Balance within two (2) business days after the later of receipt of the
Application and related forms or receipt of the initial Purchase Payment at the
Annuity Service Center. (The Net Purchase Payment is the total Purchase Payment
less any applicable Premium Tax.) If the initial Net Purchase Payment allocated
to the Separate Account cannot be credited because the Application or other
issuing requirements are incomplete, the applicant will be contacted within five
(5) business days and given an explanation for the delay, and the initial
Purchase Payment will be returned at the end of the five day period unless the
applicant consents to C.M. Life's retaining the initial Purchase Payment and
crediting it as soon as the necessary requirements are fulfilled.
The date on which the initial Net Purchase Payment is credited to the Contract
Balance is the Contract Issue Date. The Contract Issue Date is the date used to
determine Contract Years and Contract anniversaries.
The Contract Owner may return the Contract for cancellation during the first
fifteen (15) calendar days following the Contract Issue Date (or a longer
period, if required by law). Upon return of the Contract, C.M. Life will refund
the Separate Account Balance (as of the date the returned Contract and
cancellation request are received in good order at the Annuity Service Center)
and any Purchase Payments allocated to the General Account. For Contracts issued
in the States of North Carolina, South Carolina or Washington, C.M. Life will
refund all Purchase Payments received upon cancellation of the Contract during
this period, net of surrenders.
Electronic Data Transmission of Application Information. C.M. Life will accept,
by agreement with certain broker-dealers, electronic data transmissions of
Application information, along with wire transmittals of initial Purchase
Payments, from these broker-dealers to the Annuity Service Center for purchase
of the Contract. Please contact the Annuity Service Center to receive more
information about electronic data transmission of Application information.
Purchase Payments
All Purchase Payment checks or drafts should be made payable to C.M. Life
Insurance Company and sent to the Annuity Service Center.
Initial Purchase Payment. The minimum initial Purchase Payment that C.M. Life
currently will accept under a Contract is $500. C.M. Life reserves the right to
increase or decrease this amount for Contracts issued after some future date.
The initial Purchase Payment is the only Purchase Payment required to be paid
under a Contract. However, this initial Purchase Payment may be waived in the
case of certain salary reduction/employer contribution arrangements or Automatic
Investment Plans, in which case the minimum contribution will be $40 per month
per participant.
Additional Purchase Payments. Before a Death Benefit has become payable and
prior to the Annuity Income Date, the Contract Owner may make additional
Purchase Payments at any time, and in any frequency. The minimum additional
Purchase Payment is $50. If the Annuitant is age 76 or older as of the Contract
Issue Date, cumulative Purchase Payments under the Contract may not exceed
$500,000. If the Annuitant is younger than age 76 as of the Contract Issue Date,
cumulative Purchase Payments may not exceed $1,000,000 without the prior consent
of C.M. Life.
Allocation of Purchase Payments. The Contract Owner must allocate Purchase
Payments to one or more of the Sub-
11
<PAGE>
Accounts or to the General Account, or some combination thereof. The Contract
Owner must specify the initial allocation in the Application. This allocation
will be used for additional Purchase Payments unless the Contract Owner requests
a change of allocation. If the Contract Owner fails to specify how Purchase
Payments are to be allocated, the Purchase Payment(s) cannot be accepted.
Additional Purchase Payments allocated to the Separate Account will be credited
to the Contract and added to the Contract Balance as of the Valuation Period
when they are received. Purchase Payments allocated to the General Account will
be credited with interest from the day after deposit.
After the first Contract Year, the Purchase Payments allocated to the General
Account during any Contract Year may not exceed the greater of: (i) 125% of the
average annual Purchase Payments allocated to the General Account during the
last five (5) full Contract Years (or all years, if less than five (5)); or (ii)
$25,000. This restriction does not apply during the Window Period.
The Contract Owner may change the allocation instructions for future Purchase
Payments by sending a Written Request, signed by such Contract Owner, to the
Annuity Service Center. The allocation change will apply to Purchase Payments
received with the Written Request and after the Valuation Period in which the
Written Request is received.
Payment Not Honored by Bank. Any payment due under the Contract which is
derived, all or in part, from any amount paid to C.M. Life by check or draft may
be postponed until such time as C.M. Life determines that such check or draft
has been honored.
Contract Balance
On the Contract Issue Date, the accepted Contract Balance equals the initial Net
Purchase Payment. Thereafter, the Contract Balance equals the sum of the
Separate Account Balance and the General Account Balance. The Contract Balance
will increase by (1) any additional Purchase Payments accepted by C.M. Life, and
(2) any increases in the Contract Balance due to investment results of the
selected Investment Account or Sub-Account. The Contract Balance will decrease
by (1) any Surrenders, including applicable charges, (2) any decreases in the
Contract Balance due to investment results of the selected Sub-Accounts, and (3)
charges imposed by C.M. Life. The Interest Rate Factor Adjustment imposed upon
partial Surrenders may also increase or decrease the remaining Contract Balance.
The Contract Balance is expected to change from Valuation Period to Valuation
Period, reflecting the investment experience of the selected Sub-Account(s), as
well as deductions for charges. A Valuation Period is the period between
successive Valuation Dates. It begins at the close of business on each Valuation
Date and ends at the close of business on the next succeeding Valuation Date.
Holidays are generally not Valuation Dates.
The Separate Account Balance. When a Net Purchase Payment is allocated to, or an
amount is transferred to, a Sub-Account of the Separate Account, it is credited
to the Contract in the form of Accumulation Units. Each Sub-Account of the
Separate Account has a distinct Accumulation Unit value. The number of
Accumulation Units credited is determined by dividing the Net Purchase Payment,
or amount transferred, by the dollar value of one Accumulation Unit of the
Sub-Account as of the end of the Valuation Period during which the allocation is
made. When amounts are transferred out of, or Surrendered from, a Sub-Account,
Accumulation Units are cancelled or redeemed in a similar manner.
For each Sub-Account, the Accumulation Unit value for a given Valuation Period
is based on the net asset value of a share of the corresponding Portfolio or
Fund. Therefore, the Accumulation Units will fluctuate in value from day to day
based on the investment experience of the corresponding Portfolio, and the
Separate Account Balance will decrease or increase to reflect the investment
performance of the corresponding Portfolio. The Separate Account Balance also
reflects expenses borne by the Portfolio(s) and the deduction of certain
charges. The determination of Sub-Account Accumulation Unit values is described
in detail in the Statement of Additional Information.
The General Account Balance. When a Net Purchase Payment is allocated or an
amount is transferred to the General Account, it is credited to the General
Account Balance. In addition, interest at a specified interest rate is credited
to the General Account Balance. When amounts are transferred out of, or
Surrendered from, the General Account, the General Account Balance is reduced
accordingly. Unlike the Separate Account, there are no Accumulation Units in the
General Account. (See The General Account.)
Minimum Contract Balance. A minimum Contract Balance of $250 must be maintained
during the Accumulation Period. If the Contract Owner fails to maintain the
minimum Contract Balance, then C.M. Life may, upon sixty (60) days notice,
terminate the Contract, and return the Contract Balance, minus any applicable
fees or charges, to the Contract Owner. If the Contract Owner makes sufficient
Purchase Payments to restore the Contract Balance to the minimum Contract
Balance within sixty (60) days of the date of notice, the Contract will continue
in force.
Panorama Plus
Investment Accounts
Purchase Payments paid under a Contract may be allocated to one or more of the
six Sub-Accounts of the Separate Account, to the General Account, or to a
combination of these Investment Accounts. There is no guaranteed or minimum
Surrender Value for any Purchase Payments, or with respect to amounts allocated
to any Investment Account.
The Separate Account
Panorama Plus Separate Account. The Panorama Plus Separate Account of C.M. Life
Insurance Company (the "Separate Account") was established as a separate account
under the laws of the State of Connecticut, on September 25, 1991. The Separate
Account will receive and invest the Net Purchase Payments under the Contracts
that are allocated to it as well as amounts transferred to it in shares of two
mutual funds ("Funds"): the Panorama Series Fund, Inc. (the "Panorama
12
<PAGE>
Fund") (formerly known as Connecticut Mutual Financial Services Series Fund I,
Inc.) and the Oppenheimer Variable Account Funds ("OVAF").
The Separate Account currently is divided into six (6) Sub-Accounts. Additional
Sub-Accounts may be established in the future at the discretion of C.M. Life.
Each Sub-Account invests exclusively in shares of a corresponding Portfolio of
the Funds. Prior to December 1, 1996, the Money Market Sub-Account and the
Income Sub-Account were invested in shares of the corresponding Portfolios of
the Panorama Fund. On December 1, 1996, after receiving an order from the SEC
approving the transaction, C.M. Life redeemed the shares of the Money Market
Portfolio held by the Money Market Sub-Account and purchased shares of the OVAF
Money Fund with the proceeds. On that date, C.M. Life also redeemed shares of
the Income Portfolio held by the Income Sub-Account and purchased shares of the
OVAF Bond Fund with the proceeds. The portfolio substitutions and sub-account
consolidation took place at net asset value with no change in the amount of any
Contract Owner's death benefit or dollar value of his or her investment in the
Separate Account. C.M. Life and its affiliates did not receive any compensation
or remuneration as a result of this transaction.
Under Connecticut law, the assets of the Separate Account are owned by C.M.
Life, but they are held separately from the other assets of C.M. Life, and are
not chargeable with liabilities incurred in any other business operation of C.M.
Life (except to the extent that assets in the Separate Account exceed the
reserves and other liabilities of the Separate Account). Income, gains, and
losses incurred on the assets in the Sub-Accounts of the Separate Account,
whether or not realized, are credited to or charged against that Sub-Account,
without regard to other income, gains or losses of any other Investment Account
or Sub-Account of C.M. Life. Therefore, the investment performance of any
Sub-Account is entirely independent of the investment performance of C.M. Life's
general account assets or any other separate account maintained by C.M. Life.
The Contract Owner bears the entire investment risk with respect to the Contract
Balance allocated to the Separate Account, and the Separate Account Balance will
be more or less than the total of the Net Purchase Payments allocated to, and
transfers into, the Separate Account.
The Separate Account is registered with the Securities and Exchange Commission
(the "SEC") under the Investment Company Act of 1940, as amended, (the "1940
Act") as a unit investment trust. It meets the definition of a "separate
account" under the federal securities laws. However, the SEC does not supervise
the management or the investment practices or policies of the Separate Account
or of C.M. Life.
The Funds. The Separate Account will invest exclusively in shares of the
Panorama Fund and OVAF ("Funds"), each of which is a series-type mutual fund
registered with the SEC under the "1940 Act" as an open-end, diversified
management investment company. In addition to the Money Fund and Bond Fund of
OVAF, four (4) Portfolios of the Panorama Fund are currently available under the
Contract: the Government Securities Portfolio, the Total Return Portfolio, the
Growth Portfolio, and the International Equity Portfolio. The assets of each
investment option are held separately from the assets of the other investment
options, and each investment option has its own distinct investment objective
and policies. Each investment option operates as a separate investment fund, and
the income or losses of one Portfolio have no effect on the investment
performance of any other investment option.
The investment objective of each of the available investment options is stated
as follows:
Money Fund
Seeks the maximum current income from investments in "money market" securities
consistent with low capital risk and the maintenance of liquidity. There can be
no assurance that the Money Portfolio will maintain a stable net asset value per
share of $1, and the Money Portfolio is not insured or guaranteed by the U.S.
Government.
Government Securities Portfolio
To seek a high level of current income with a high degree of safety of
principal, by investing primarily in securities that are issued by or guaranteed
as to principal and interest by the U.S. Government, its agencies, authorities
or instrumentalities and in obligations that are fully collateralized or
otherwise fully backed by U.S. Government Securities.
Bond Fund
Seeks a high level of current income from investments in high-yield, fixed-
income securities rated "Baa" or better by Moody's or "BBB" or better by
Standard & Poor's. As a secondary investment objective, the Bond Fund seeks
capital growth when consistent with its primary objective.
Total Return Portfolio
Seeks to maximize the total investment return (including capital appreciation
and income) by allocating its assets among stocks, corporate bonds, securities
issued by the U.S. Government and its instrumentalities, and money market
instruments according to changing market conditions.
Growth Portfolio
Seeks long-term growth of capital by investing primarily in common stocks with
low price-earnings ratios and better than anticipated earnings. Realization of
income is a secondary consideration.
International Equity Portfolio
Seeks to provide long-term growth of capital by investing, under normal market
conditions, at least 90% of its assets in equity securities (such as common
stocks) of companies whose primary stock market is outside the U.S.
13
<PAGE>
OppenheimerFunds, Inc. ("OFI"), an investment adviser registered with the SEC
under the Investment Advisers Act of 1940, as amended, ("Investment Advisers
Act") is the investment adviser to the Funds. OFI has operated as an investment
adviser since 1959 and, including a subsidiary, manages investment companies
with more than $62 billion in assets and over 3 million shareholder accounts.
OFI is owned by Oppenheimer Acquisition Corp., a holding company that is owned
in part by senior officers of OFI and controlled by MassMutual. The address of
OFI is Two World Trade Center, New York, NY 10048-0203.
Babson-Stewart Ivory International ("Babson-Stewart") provides sub-advisory
services to the International Equity Portfolio pursuant to a sub-advisory
agreement between Babson-Stewart and OFI. Babson-Stewart is located at One
Memorial Drive, Cambridge, MA 02142, and is a partnership formed in 1987 between
David L. Babson & Co., Inc., a subsidiary of MassMutual, and Stewart Ivory &
Co., Ltd., located in Edinburgh, Scotland.
THERE IS NO ASSURANCE THAT ANY PORTFOLIO WILL ACHIEVE ITS STATED OBJECTIVE. More
detailed information, including a description of each Portfolio's investment
objective and policies and a description of risks involved in investing in each
of the Portfolios and of each Portfolio's fees and expenses is contained in the
prospectus for the Funds, a current copy of which is attached to this
Prospectus. Information contained in the prospectuses for the Funds should be
read carefully before making allocations to a Sub-Account of the Separate
Account.
The General Account
The General Account is made up of all of the assets of C.M. Life other than
those allocated to separate accounts. Purchase Payments will be allocated to the
General Account to the extent elected by the Contract Owner at the time of the
initial Purchase Payment or as subsequently elected. Subject to certain
limitations, all or part of the Separate Account Balance may be transferred to
the General Account as described under "Transfers." Assets supporting amounts
allocated to the General Account become part of C.M. Life's general account
assets and are available to fund the claims of all classes of customers, policy
owners and other creditors of C.M. Life. Interests under the Contract relating
to the General Account are registered under the Securities Act of 1933, as
amended, ("1933 Act") but the General Account is not registered under the 1940
Act.
Contract Balances in the General Account will not share in the investment
performance of the General Account. Instead, C.M. Life will pay a specified rate
of interest on such balance. The interest rate credited to General Account
Balances will vary at the sole discretion of C.M. Life. The Contract Owner
should check with his or her registered representative or the Annuity Service
Center for current availability. However, C.M. Life will credit interest at an
effective annual rate of not less than 3% per year, compounded annually, to
amounts allocated to the General Account under the Contract. C.M. Life is not
obligated to credit any interest in excess of 3%. There is no specific formula
for the determination of the interest rate. Some of the factors that C.M. Life
may consider in determining the interest rate are: general economic trends;
rates of return currently available and anticipated on C.M. Life's investments;
expected investment yields; regulatory and tax requirements; and competitive
factors. C.M. Life may, with respect to investments and average terms of
investments, use dedication (cash flow matching), and/or duration matching, or
other methods to minimize C.M. Life's risk in volatile interest rate
environments of not achieving the rates it is crediting. C.M. Life resets this
rate periodically. ANY INTEREST CREDITED TO AMOUNTS ALLOCATED TO THE GENERAL
ACCOUNT IN EXCESS OF 3% PER YEAR WILL BE DETERMINED AT THE SOLE DISCRETION OF
C.M. LIFE. THE CONTRACT OWNER ASSUMES THE RISK THAT INTEREST CREDITED ON AMOUNTS
ALLOCATED TO THE GENERAL ACCOUNT MAY NOT EXCEED 3% PER YEAR. It currently resets
the rate quarterly, but in the future the rate may be reset more or less
frequently. The Contract Owner also assumes the risk that the Surrender Value of
amounts allocated to the General Account will be less than the General Account
Balance, and less than the Net Purchase Payments allocated to the General
Account.
Amounts held in the General Account are subject to an Interest Rate Factor
Adjustment explained later in this prospectus and in the prospectus for this
account which is attached.
Transfers
The Contract Owner may transfer Contract Balance amounts to or from the General
Account and/or any Sub-Account of the Separate Account, within certain limits,
as described below. Although no fee is currently imposed on transfers, C.M. Life
reserves the right to charge such a fee in the future, and to otherwise restrict
the transfer privilege in any way, or to eliminate it entirely.
During the Accumulation Period, the Contract Owner (or the Beneficiary, if a
Death Benefit has become payable) may transfer Contract Balance amounts,
subject to the following provisions.
. The Contract Owner signs and submits a Written Request for a transfer which
is received by the Annuity Service Center.
. The minimum transfer amount is $100.
. The total amount of all transfers to or from the General Account during
each Contract Year is limited to the greater of: (i) 30% of the General
Account Balance as of the end of the immediately preceding Contract Year;
or (ii) $25,000.
. Transfers between the General Account and the Money Sub-Account (together,
the "Competing Accounts") are only permitted during a Window Period. In
addition, for a period of ninety (90) days following a transfer out of one
Competing Account, no transfers (i.e., from any Account) may be made into
the other Competing Account.
. Similarly, for a period of ninety (90) days following a transfer into
either Competing Account, no transfers (i.e.,
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to any Account) may be made out of the other Competing Account.
During the Annuity Period, the Contract Owner (who may or may not be the
Annuitant) may transfer Separate Account Balance amounts, subject to the
following provisions.
. The Contract Owner signs and submits a Written Request for a transfer which
is received by the Annuity Service Center.
. Transfers to or from the General Account are not permitted during the
Annuity Period.
. Transfers during the Annuity Period may be made only once during any
Contract Year.
. Transfers between Sub-Accounts during the Annuity Period will be processed
based on the formula outlined in the Statement of Additional Information.
Contract Owners may elect to make transfers by telephone. To do so, the Contract
Owner must submit a completed Written Request electing the telephone transfer
privilege. Telephone requests must be received at the Annuity Service Center no
later than 4:00 Eastern Standard Time to assure same day pricing. Telephone
requests will not be accepted after that time. C.M. Life will use reasonable
procedures to confirm that instructions communicated by telephone are genuine.
If it does not, C.M. Life may be liable for any losses due to unauthorized or
fraudulent instructions. C.M. Life may tape record all telephone instructions.
C.M. Life will not be liable for any loss, liability, cost or expense incurred
by the Contract Owner for acting in accordance with such telephone instructions
believed to be genuine. The telephone transfer privilege may be discontinued by
C.M. Life at any time.
Dollar Cost Averaging
To the extent provided below, amounts from Sub-Accounts and the General Account
may be transferred at regular intervals. This election is called "Dollar Cost
Averaging."
Upon Written Request, a Contract Owner may elect Dollar Cost Averaging ("DCA")
to begin at any time during the Accumulation Period, except as otherwise
provided in DCA Option 2 - Fixed Dollar Amount Transfers described below. There
is currently no charge for DCA. However, the Company reserves the right to
charge for DCA in the future. The Contract Owner may not simultaneously
participate in both DCA and Systematic Withdrawals. (See Systematic
Withdrawals.)
DCA will begin when a properly completed Written Request from the Contract Owner
is received by the Company at least five (5) business days prior to the transfer
start date selected by the Contract Owner. If the DCA start date is less than
five (5) days after the date the Written Request is received by the Company, the
Company may defer the DCA start date for one (1) month. If no start date has
been selected, the Company will automatically start DCA within five (5) business
days after the Written Request is received.
If DCA is elected, the Contract Owner may direct the transfer of amounts at
regular intervals under one of the following options:
DCA OPTION 1 FROM THE SUB-ACCOUNTS - This option provides for the transfer
of fixed dollar amounts at regular intervals from any one Sub-Account to one
or more other Sub-Account(s), as elected by the Contract Owner. Transfers
must be at least $100 per transferee Sub-Account. Transfers to the General
Account are not permitted.
DCA OPTION 2 - FIXED DOLLAR AMOUNT TRANSFERS - This option provides for the
transfer of fixed dollar amounts at regular intervals from the General
Account to one or more of the Sub-Accounts (other than the Money Market
Sub-Account). Transfers must be for at least $100 per transferee
Sub-Account. Total transfers from the General Account are limited in the
Contract Year of the initial Purchase Payment to the greater of: (i) 30% of
the initial Purchase Payment; or (ii) $25,000. In subsequent Contract Years
total transfers from the General Account are limited to the greater of: (i)
30% of the General Account Balance as of the end of the immediately
preceding Contract Year; or (ii) $25,000. Election into this option may only
be made during the Accumulation Period as follows: at the time of the
initial Purchase Payment into the General Account; or, in subsequent years,
on the Contract Year anniversary, provided that the Company receives the
Written Request for this election at least five (5) business days in advance
of such anniversary.
DCA OPTION 3 - INTEREST-ONLY TRANSFERS - This option provides for the
transfer of the credited interest of the General Account at regular
intervals to one or more of the Sub-Accounts (other than the Money Market
Sub-Account). The transferred amount is comprised of the credited interest
for the selected interval (e.g., monthly, quarterly). The $100 minimum
transfer amount does not apply to this option. To participate in this
option, there is a $5,000 minimum General Account Balance required at the
time of each transfer.
DCA OPTIONS 2 & 3 FROM THE GENERAL ACCOUNT - These options provide for the
transfer of amounts at regular intervals from the General Account to one or
more of the Sub-Accounts (other than the Money Market Sub-Account). Except
during the Window Period, additional transfers from the General Account are
not permitted while a DCA option 2 or 3 is in effect. DCA Options 2 and 3
are described below.
Changes in the terms of any option elected (such as amount transferred or
Sub-Account designation) may be made by Written Request to terminate the
existing DCA, along with a Written Request providing new DCA elections.
DCA will terminate when any of the following occurs:
(1) the number of designated transfers has been completed;
(2) the value of the General Account or Sub-Account is insufficient to
complete the next transfer;
(3) a Written Request from the Contract Owner is received at least five
(5) business days prior to the next transfer date;
(4) for Option 3, where the General Account balance falls below $5,000;
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(5) the Annuity Income Date arrives; or
(6) the Contract is terminated.
Except as otherwise provided, Dollar Cost Averaging is subject to the transfer
provisions of the Contract. (See Transfers.) Dollar Cost Averaging is not
currently available in all states.
Distributions Under The Contract
Surrenders
The Contract Owner may surrender all or a portion of the Contract Balance in
exchange for a cash payment from C.M. Life. The proceeds payable upon a full
Surrender are the Contract Balance less any applicable Surrender Charge,
Contract Maintenance Fee, any applicable premium taxes, and plus or minus any
applicable Interest Rate Factor Adjustment. The net proceeds payable upon full
Surrender are the "Surrender Value." There is no minimum or guaranteed Surrender
Value. The proceeds payable upon a partial Surrender are the Surrender amount
requested; any applicable Surrender Charge is subtracted from, and any
applicable Interest Rate Factor Adjustment is added to, or subtracted from, the
remaining Contract Balance. There is no Surrender Charge or Interest Rate Factor
Adjustment on Surrenders during a Window Period. Any Surrender Charge or
Contract Maintenance Fee imposed on Surrender will be allocated among the
General Account and the Sub-Accounts in the same manner (pro rata) as the
Contract Balance subject to Surrender is allocated among the General Account and
the Sub-Accounts. For Contracts issued to Pennsylvania residents, the Contract
Maintenance Fee will be allocated pro rata among the Sub-Accounts. Any
applicable Interest Rate Factor Adjustment imposed on a Surrender will be
imposed only on the amount of General Account Balance subject to Surrender. For
partial Surrenders, the Contract Owner must specify the Investment Account or
Sub-Account from which surrendered amounts should be taken.
The minimum amount that can be withdrawn from any Sub-Account or the General
Account is $100. In addition, following any partial Surrender, the remaining
Contract Balance must be at least $250. If the processing of a partial Surrender
request would result in a remaining Contract Balance of less than $250, C.M.
Life will treat the partial Surrender request as a full Surrender of the
Contract, and the Surrender Value will be paid. Following payment of the
Surrender Value, the Contract will be canceled.
The Contract Owner may request the Contract Balance at any time during the life
of the Annuitant and Contract Owner and prior to the Annuity Income Date, by
sending a Written Request to the Annuity Service Center. Surrenders are
permitted any time during the Accumulation Period. (See Annuity Options.)
C.M. Life will process all partial Surrender and full Surrender requests within
seven (7) calendar days (unless a shorter period is required under applicable
law) following receipt by the Annuity Service Center of the Contract Owner's
Written Request, except in the following situations for the following Accounts.
General Account - C.M. Life reserves the right to defer payment of any
Surrender from the General Account for up to six (6) months.
Separate Account - C.M. Life reserves the right to defer the payment of any
Surrender from the Separate Account as permitted by the 1940 Act. Such delay
may occur because: (i) the New York Stock Exchange is closed for trading;
(ii) the SEC determines that a state of emergency exists; or (iii) an order
or pronouncement of the SEC permits a delay for the protection of Contract
Owners.
In addition, a Purchase Payment amount is not available to satisfy a Written
Request for Surrender until the check, or other instrument by which such
Purchase Payment was made, has been honored.
Beginning in the second Contract Year, the Contract Owner is entitled to an
annual Free Surrender Amount, which is exempt from a Surrender Charge and from
any Interest Rate Factor Adjustment. The Free Surrender Amount equals 10% of the
Contract Balance as of the end of the immediately preceding Contract Year, and
is allocated among the General Account and Sub-Accounts in the same proportion
as the partial Surrender or full Surrender requested. The Free Surrender amount
may be taken in multiple installments in each Contract Year. Any amount subject
to Surrender in excess of the Free Surrender Amount is subject to the Surrender
Charge and the Interest Rate Factor Adjustment, as applicable. (See Interest
Rate Factor Adjustment and Surrender Charge.) Any unused Free Surrender Amount
cannot be accumulated and carried from one year to the next. (Surrenders may
result in tax liabilities. See Tax Status.)
Since the Contract Owner assumes the entire investment risk with respect to
Purchase Payments and transfers allocated to the Separate Account, and certain
risks with respect to amounts allocated to the General Account, and because
Surrenders are subject to a Surrender Charge, an Interest Rate Factor
Adjustment, a Contract Maintenance Fee, and possibly Premium Taxes, the total
amount paid upon full Surrender may be more or less than the total Purchase
Payments made (taking any prior partial Surrenders into account). Following a
Surrender of the total Contract Balance, or at any time the Contract Balance is
zero, all rights of the Contract Owner and Annuitant will terminate.
Systematic Withdrawals
Upon Written Request, a Contract Owner may elect Systematic Withdrawals ($100
minimum per withdrawal) to begin on or after the first anniversary of the
Contract Issue Date during the Accumulation Period. There is currently no charge
for Systematic Withdrawals. However, the Company reserves the right to charge
for Systematic Withdrawals in the future. The Contract Owner may not
simultaneously participate in both Systematic Withdrawals and Dollar Cost
Averaging.
If Systematic Withdrawals are elected, the Contract Owner may withdraw fixed
dollar amounts at regular intervals from the Contract Balance.
Systematic Withdrawals will begin when a properly completed Written Request from
the Contract Owner is received by the Company, at least five (5) business days
prior to the Systematic
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Withdrawals start date selected by the Contract Own. If the Systematic
Withdrawals start date is less than five (5) days after the date the Written
Request is received by the Company, the Company may defer the Systematic
Withdrawals start date for one (1) month. If no start date has been selected,
the Company will automatically start Systematic Withdrawals within five (5)
business days after the Written Request is received.
Changes in Systematic Withdrawals may only be made by Written Request from the
Contract Owner to terminate the existing Systematic Withdrawals election along
with a Written Request designating a new Systematic Withdrawals election.
Systematic Withdrawals will terminate when any of the following occurs:
(1) the number of designated Systematic Withdrawals has been completed;
(2) the value of the General Account or Sub-Account is insufficient to
complete the next withdrawal;
(3) Written Request from the Contract Owner is received at least five (5)
business days prior to the next withdrawal date;
(4) the Annuity Income Date arrives; or
(5) the Contract is terminated.
Withdrawals in excess of the Free Surrender Amount may be subject to any
applicable Surrender Charge and Interest Rate Factor Adjustment. (See
Surrenders.)
Further, withdrawals may result in tax liabilities. See Tax Status.
The Systematic Withdrawals plan is not currently available in all states.
Annuity Income Payments
C.M. Life will pay an Annuity Income beginning on the Annuity Income Date,
provided no Death Benefit has become payable, and the Contract Owner has
selected an available Annuity Option and payment schedule by Written Request.
The Annuity Option and frequency of Annuity Income payments may not be changed
after Annuity Income payments begin. Unless the Contract Owner specifies
otherwise, the payee of the Annuity Income is the applicable Annuitant. After
the death of the Annuitant, any remaining payments will be made to the
Beneficiary. The dollar amount and frequency of the payments will depend on
numerous factors, such as the Contract Balance, the type of Annuity and Annuity
Option elected, possibly age and sex, and any applicable Interest Rate Factor
Adjustment.
Annuity Income Date. Initially, the Annuity Income Date is selected by the
Contract Owner at the time the Application is completed. The Annuity Income Date
may be changed from time to time by the Contract Owner by Written Request to
C.M. Life, provided that notice of each change is received by C.M. Life at its
Annuity Service Center at least thirty (30) days prior to the then-current
Annuity Income Date. Except as otherwise permitted by C.M. Life, an Annuity
Income Date must be a date which is no earlier than the fifth anniversary of the
Contract Issue Date. The latest Annuity Income Date which may be elected is the
Annuitant's 90th birthday (unless a longer period is required under applicable
state law).
Election of Annuity Option. The Contract Owner will choose an Annuity Option in
the Application. During the lifetime of the Annuitant and Contract Owner and
prior to the Annuity Income Date, the Contract Owner may change the election,
but a Written Request specifying a change of election must be received by C.M.
Life at its Annuity Service Center at least thirty (30) days prior to the
Annuity Income Date. If no election is made at least thirty (30) days prior to
the Annuity Income Date, Annuity Income will be paid under Option B, life income
with 120 monthly payments guaranteed. (See Annuity Options.)
If the Annuitant or Contract Owner dies prior to the Annuity Income Date, the
Beneficiary may receive a Death Benefit. (See Death Benefit.)
Premium Tax. C.M. Life may be required by state law to pay a Premium Tax on the
amount applied to an Annuity Option (or upon Surrender). If so, C.M. Life will
deduct the Premium Tax before applying (or paying) the proceeds.
Annuity Options
The Contract provides six (6) Annuity Options which are described below. Five
(5) of these are offered as either a Fixed Annuity or a Variable Annuity (Option
E is only available as a Fixed Annuity). Contract Owners may elect a Fixed
Annuity, a Variable Annuity, or a combination of both. If the Contract Owner
elects a combination, he must specify what part of the Contract Balance is to be
applied to the Fixed and Variable Options. Unless specified otherwise, the
General Account Balance will be used to provide a Fixed Annuity, and the
Separate Account Balance will be used to provide a Variable Annuity. (If the
General Account Balance is used to provide Variable Annuity Income payments,
then the Interest Rate Factor Adjustment will be applied at that time.) Variable
Annuity income payments will be based on the Sub-Account(s) selected by the
Contract Owner, or on the allocation of the Separate Account Balance among the
Sub-Accounts.
If the amount of the Annuity Income will depend on the age or sex of the
Annuitant, C.M. Life reserves the right to ask for satisfactory proof of the
Annuitant's (and Joint Annuitant's) age and sex. C.M. Life may delay Annuity
Income payments until satisfactory proof is received.
On the Annuity Income Date, the sum of: (i) the General Account Balance
(adjusted by the Interest Rate Factor Adjustment to the extent that the General
Account Balance is applied to a Variable Annuity Option); and (ii) the Separate
Account Balance; minus (iii) any Premium Tax, will be applied to provide for
Annuity Income payments under the selected Annuity Option.
A Fixed Annuity provides for Annuity Income payments which will remain constant
pursuant to the terms of the Annuity Option elected. The effect of choosing a
Fixed Annuity is that the amount of each payment will be set on the Annuity
Income Date and will not change. If a Fixed Annuity is selected, the Separate
Account Balance used to provide the Fixed Annuity will be transferred to the
general assets of C.M. Life, and the Annuity Income payments will be fixed in
amount by the Fixed Annuity provisions selected, and, for some options, the age
and sex (if consideration of sex is allowed) of the Annuitant.
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The Fixed Annuity payment amounts are determined by applying the Annuity
Purchase Rate specified in the Contract to the portion of the Contract Balance
allocated to the Fixed Annuity Option selected by the Contract Owner.
A Variable Annuity provides for payments that fluctuate or vary in dollar
amount, based on the investment performance of a Separate Account Sub-Account.
The Variable Annuity purchase rate tables in the Contract reflect an assumed
interest rate of 4%, so if the actual net investment performance of the
Sub-Account is less than this rate, then the dollar amount of the actual Annuity
Income payments will decrease. If the actual net investment performance of the
Sub-Account is higher than this rate, then the dollar amount of the actual
Annuity Income payments will increase. If the net investment performance exactly
equals the 4% rate, then the dollar amount of the actual Annuity Income payments
will remain constant.
Annuity Units and Payments. The dollar amount of each Variable Annuity
payment depends on the number of "Annuity Units" credited to that Annuity
Option and the value of those units. The number of Annuity Units is
determined as follows.
1. The number of Annuity Units credited in each Sub-Account will be
determined by dividing the product of the portion of the Contract
Balance to be applied to the Sub-Account and the Annuity Purchase Rate
specified in the Contract by the value of one Annuity Unit in that Sub-
Account on the Annuity Income Date.
2. The amount of each Annuity Income payment equals the product of the
Annuitant's number of Annuity Units and the Annuity Unit Values on the
payment date. The amount of each payment may vary from prior Annuity
Income payments.
Annuity Unit Value. The value of an Annuity Unit in a Sub-Account on any
Valuation Date is determined as follows.
1. The Net Investment Factor for the Valuation Period (for the appropriate
Annuity Income payment fre-quency) just ended is multiplied by the
value of the Annuity Unit for the Sub-Account on the preceding Valuation
Date.
2. The result in (1) is then divided by an interest factor. The interest
factor equals 1.00 plus the interest rate for the number of days since
the preceding Valuation Date. Interest is based on an effective annual
rate of 4%. This compensates for the interest assumption built into the
Annuity Purchase Rates.
The Contract Owner may choose to receive Annuity Income payments under any one
of the Annuity Options described below. The Company may consent to other plans
of payment before the Annuity Income Date.
Note Carefully: Under Annuity Options A and C, it would be possible for only one
(1) Annuity Income payment to be made if the Annuitant were to die before the
due date of the second annuity payment; only two (2) Annuity Income payments if
the Annuitant were to die before the due date of the third annuity payment; and
so forth.
The following Annuity Options are available.
Annuity Option A - Life Income _ Periodic payments will be made as long as
the Annuitant lives.
Annuity Option B - Life Income with Period Certain _ Periodic payments will
be made for a guaranteed period, or as long as the Annuitant lives,
whichever is longer. The guaranteed period, which is selected by the
Contract Owner, may be five (5), ten (10), or twenty (20) years.
Annuity Option C - Joint and Last Survivor Payments _ Periodic payments will
be made during the joint lifetime of two (2) Annuitants, continuing in the
same amount during the lifetime of the surviving Annuitant.
Annuity Option D - Joint and 2/3 Survivor Annuity _ Periodic payments will
be made during the joint lifetime of two (2) Annuitants. Payments will
continue during the lifetime of the surviving Annuitant, and will be
computed on the basis of two-thirds of the annuity payment (or units) in
effect during the joint lifetime.
Annuity Option E - Period Certain - (Available as a Fixed Annuity only) -
Periodic payments will be made for a specified period. The specified period
must be at least five (5) years and cannot be more than thirty (30) years.
Annuity Option F - Special Income Settlement Agreement - C.M. Life will pay
the proceeds in accordance with terms agreed upon in writing by the Contract
Owner and C.M. Life. This option may be elected only at the Annuity Income
Date.
* * * * *
Annuity Income Payments. Except as otherwise agreed to by the Contract Owner and
C.M. Life, Annuity Income payments will be payable monthly. The minimum amount
that may be applied under any Annuity Option, and the minimum periodic Annuity
Income payment allowed, are the most recently published minimums designated by
C.M. Life for this purpose. A portion or the entire amount of the Annuity
Payments may be taxable as ordinary income. If, at the time the Annuity Payments
begin, C.M. Life has not received a proper written election not to have federal
income taxes withheld, C.M. Life must by law withhold such taxes from the
taxable portion of such annuity payments and remit that amount to the federal
government. For certain payments, an election out of withholding is not
available. (See Tax Status.)
Terminal Illness Benefit
In the event that a Contract Owner becomes terminally ill during the
Accumulation Period and prior to age 75, the Contract Owner may elect, unless
prohibited by law, by submission of a Written Request, a Terminal Illness.
Benefit equal to the greater of:
(a) the Purchase Payments less any prior withdrawals and charges; or
(b) the Contract Balance.
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The Company will require proof that the Contract Owner is terminally ill and not
expected to live more than twelve (12) months. This proof will include, but is
not limited to, certification by a licensed medical practitioner performing
within the scope of his/her license. The licensed medical practitioner must not
be the Contract Owner, Annuitant or the Contingent Annuitant, or the parent,
spouse or child of the Contract Owner, Annuitant or Contingent Annuitant.
Payment of the Terminal Illness Benefit is determined on the date the Company
receives the Written Request. No Contract Maintenance Fee for the current year,
Surrender Charge or Interest Rate Factor Adjustment shall apply with respect to
any Terminal Illness Benefit. Payment of the Terminal Illness Benefit will be in
full settlement of the Company's liability under the Contract. The Terminal
Illness Benefit is not available for Contracts issued in Kansas, Mississippi,
Texas, or Pennsylvania.
Death Benefit
If the Annuitant or Contract Owner dies prior to the Annuity Income Date, a
Death Benefit will be paid to the Beneficiary upon receipt at the Annuity
Service Center of proof of death. If, however, the Annuitant dies before such
Contract Owner and there is a Contingent Annuitant who is less than 85 years of
age on the Annuitant's date of death (and such Contract Owner is a natural
person), then no Death Benefit is payable, and the Contract will continue in
force, with the Contingent Annuitant as the Annuitant. For purposes of the Death
Benefit, the Annuitant is the Annuitant named in the Application.
The Death Benefit is payable upon receipt of proof of death, as well as proof
that the death occurred during the Accumulation Period. Upon receipt of this
proof and an election of a Death Benefit Option, and return of the Contract, the
Death Benefit generally will be payable after C.M. Life has sufficient
information to make the payment(s).
Payments under a Death Benefit Option are determined at the time of payment,
and, if the deceased Annuitant or Contract Owner was a natural person less than
age 75 at death, are based on the greater of (a) the Contract Balance or (b) the
Purchase Payments less any prior withdrawals and charges. Otherwise, the
payments are based on the Contract Balance at the time of payment. No Surrender
Charge, Interest Rate Factor Adjustment, or Contract Maintenance Fee shall apply
with respect to any Death Benefit Option.
Payment of the Death Benefit will be in full settlement of the Company's
liability under this Contract.
The available Death Benefit Options depend on whether the Contract Owner and
Annuitant are the same person.
Death of Contract Owner. If the Contract Owner is not the Annuitant, and the
Contract Owner dies before the Annuitant and prior to the Annuity Income Date,
one of the following provisions will apply.
1. If the Contract Owner's spouse is the Beneficiary and survives the
Contract Owner, the spouse may select only Death Benefit Option A, B,
or C within one (1) year after the Contract Owners death.
If the surviving spouse does not make a selection within one (1) year
after the Contract Owner's death, the surviving spouse will become the
Contract Owner.
2. If the Beneficiary is a natural person other than the Contract Owner's
spouse, the Beneficiary may select only Death Benefit Option B or C
within one (1) year after the Contract Owner's death.
If no selection is made within one (1) year after the Contract Owner's
death, the Death Benefit will be paid to the Beneficiary in a single
sum at that time.
3. If the Beneficiary is not a natural person, it may select only Death
Benefit Option B or D within one (1) year after the Contract Owner's
death.
4. If no Beneficiary survives the Contract Owner, the Annuitant shall be
deemed to be the Beneficiary and provision 1 or 2 above shall apply.
If no selection is made within one (1) year after the Contract Owner's
death, the Death Benefit will be paid in a single sum at that time.
Death of Contract Owner/Annuitant. If the Contract Owner and Annuitant are the
same person, and the Contract Owner/Annuitant dies before the Annuity Income
Date, one of the following provisions applies.
1. If the Contract Owner/Annuitant's spouse is the Beneficiary, the
surviving spouse may only select Death Benefit Option B, C, or G
within (1) one year after the Contract Owner/Annuitant's death.
If no selection is made within one (1) year after the Contract
Owner/Annuitant's death, the surviving spouse will become the Contract
Owner and Annuitant of the Contract.
2. If the Beneficiary is a natural person other than the Contract
Owner/Annuitant's spouse, the Beneficiary may select only Death
Benefit Option B or C within (1) one year of the Contract
Owner/Annuitant's death.
If no selection is made within one (1) year after the Contract
Owner/Annuitant's death, the Death Benefit will be paid in a single
sum at that time.
3. If the Beneficiary is not a natural person, it may select only Death
Benefit Option B or D within one (1) year after the Contract
Owner/Annuitant's death. See below.
4. If no Beneficiary survives the Contract Owner/Annuitant, the Death
Benefit will be paid in a single sum to the Contract Owner/Annuitant's
estate within five (5) years of the date of death.
If no selection is made within one (1) year after the Contract
Owner/Annuitant's death, the Death Benefit will be paid in a single
sum at that time.
Death of Annuitant. If the Contract Owner and Annuitant are not the same person,
and the Annuitant dies before the Contract Owner and prior to the Annuity Income
Date, and there is no Contingent Annuitant younger than age 85 (or if
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the Contract Owner is not a natural person), one of the following provisions
applies.
1. The Beneficiary, if a natural person, may only select Death Benefit
Option E or F within one (1) year after the Annuitant's death. (See
below.)
If no selection is made within one (1) year after the Annuitant's death,
the Death Benefit will be paid in a single sum to the Beneficiary at that
time.
2. If the Beneficiary is not a natural person, it may only select Death
Benefit Option D or E within one (1) year after the Annuitant's death.
(See below).
If no selection is made within one (1) year after the Annuitant's death, the
Death Benefit will be paid in a single sum at that time.
3. If no Beneficiary survives the Annuitant, the Contract Owner shall be
deemed the Beneficiary and provision 1 or 2 immediately above shall
apply.
Death Benefit Options. Life expectancy for purposes of these Death Benefit
Options will be determined from the tables in the Regulations, under Section 72
of the Code. The following Death Benefit Options are available:
Death Benefit Option A - To become the Contract Owner;
Death Benefit Option B - To receive the Death Benefit as a single sum
within one (1) year after the Contract Owner's death;
Death Benefit Option C - To receive the Death Benefit under any Annuity
Option offered in the Contract, provided the entire Death Benefit is
distributed:
1. Within five (5) years of the date of death; or
2. Over a period not extending beyond the life expectancy of the
Beneficiary; or
3. Over the life of the Beneficiary.
If the Death Benefit is to be paid under provision (2) or (3), the first
installment payment must be made within one (1) year after the Contract Owner's
death.
Death Benefit Option D - To receive the Death Benefit under any Annuity
Option offered in the Contract, provided the entire Death Benefit is
distributed within five (5) years of the date of death;
Death Benefit Option E - To receive the Death Benefit as a single sum
within one (1) year after the Annuitant's death;
Death Benefit Option F - To receive the Death Benefit under any Annuity
Option offered in the Contract, provided the Death Benefit is distributed:
1. Over a period not extending beyond the life expectancy of the
Beneficiary; or
2. Over the life of the Beneficiary.
The first installment payment must be made within one (1) year after the
Annuitant's death.
Death Benefit Option G - To become the Contract Owner and Annuitant of the
Contract, just as if the Beneficiary had always been the Contract Owner and
Annuitant.
Death of Annuitant On or After Annuity Income Date. The Death Benefit payable if
the Annuitant dies on or after the Annuity Income Date, if any, depends on the
Annuity Option in effect on the date of death of the Annuitant. Any remaining
payments will be distributed at least as rapidly as under the method of
distribution being used as of the date of the Annuitant's death. If a
Beneficiary dies while receiving such benefits, the balance of the benefits, if
any, will be paid in a single sum to the estate of the Beneficiary. If no
Beneficiary survives the Annuitant, the benefits, if any, will be paid in a
single sum to the estate of the last Annuitant to die.
Beneficiary. One or more Beneficiaries may be designated to receive benefits
concurrently, contingently or successively upon the death of the Contract Owner
and/or the Annuitant. The Beneficiary designation in the Application will remain
in effect until changed. The Contract Owner may, upon Written Request, change
the designated Beneficiary before a Death Benefit has become payable. The
Beneficiary's consent to such change is not required unless the Beneficiary was
irrevocably designated or consent is required by law. (If an irrevocable
Beneficiary dies, the Contract Owner may then designate a new Beneficiary.) The
change will take effect as of the date the Contract Owner signs the Written
Request. However, the change is subject to any payments made or actions taken by
C.M. Life before receipt of the Written Request. On or after receipt of proof of
death at the Annuity Service Center, the Beneficiary shall have the exclusive
right to (i) appoint a contingent Beneficiary to succeed to the interest of the
Beneficiary in the event of the Beneficiary's death; and (ii) make transfers
under the Contract. (See Transfers.)
IRS Required Distribution
Federal tax law requires that if the Contract Owner dies before the Annuity
Income Date, then the entire value of the Contract must generally be distributed
within five (5) years of the date of death of the Contract Owner. Special rules
may apply to the spouse of the deceased Contract Owner. (See Federal Tax Matters
of the Statement of Additional Information, for a detailed description of these
rules.)
Restrictions Under the Texas Optional
Retirement Program
Section 36.105 of the Texas Educational Code permits participants in the Texas
Optional Retirement Program ("ORP") to withdraw their interests in a variable
annuity contract issued under the ORP only upon: (1) termination of employment
in the Texas public institutions of higher education; (2) retirement; or (3)
death. Accordingly, a participant in the ORP (or the participant's estate if the
participant has died) will be required to obtain a certificate of termination
from the employer, or a certificate of death, before the Contract can be
surrendered.
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Restrictions Under Section 403(b) Plans
Section 403(b) of the Code provides for tax-deferred retirement savings plans
for employees of certain non-profit and educational organizations. In accordance
with the requirements of Section 403(b), any Contract used for a 403(b) plan
will prohibit distributions of elective contributions, and earnings on elective
contributions, except upon death of the employee, attainment of age 59 1/2,
separation from service, disability, or financial hardship. In addition, income
attributable to elective contributions may not be distributed in the case of
hardship.
Charges And Deductions
C.M. Life will make certain charges and deductions under the Contract in order
to compensate it for incurring expenses in distributing the Contract, bearing
mortality and expense risks under the Contract, and administering the Investment
Accounts and the Contract. Charges may also be made for Premium Taxes, and other
federal, state or local taxes. Charges and expenses are also deducted from the
assets of the Portfolios.
Surrender Charge
C.M. Life will incur expenses relating to the sale of Contracts, including
commissions to registered representatives and other promotional expenses. In
connection with a full Surrender or partial Surrender during the first five (5)
Contract Years, C.M. Life may deduct from the Contract Balance a Surrender
Charge equal to 5% of any Contract Balance surrendered in order to help cover
distribution expenses. The Surrender Charge will be deducted as of the date of
the receipt at the Annuity Service Center of the Written Request for the
Surrender. Any Surrender Charge assessed will be allocated among the General
Account and the Sub-Accounts in the same manner (pro rata) as the Contract
Balance subject to Surrender is allocated among the General Account and the
Sub-Accounts. The Surrender Charge will not be applied under the following
circumstances:
1. Cancellation of the Contract during the 15-day examination period;
2. Full Surrender of the Contract on the Annuity Income Date;
3. Partial Surrenders or full Surrenders during the Win- dow Period or
after the first five (5) Contract Years, (the Window Period is the
last thirty (30) days of each Five-Year Period under the Contract);
4. Upon payment of the Death Benefit;
5. On any Free Surrender Amount. Beginning in the second Contract Year,
the Contract Owner is entitled to an annual Free Surrender Amount,
which is exempt from a Surrender Charge and any applicable Interest
Rate Factor Adjustment. See "Interest Rate Factor Adjustment" below.
The Free Surrender Amount will be allocated among the General Account
and/or Sub-Accounts in the same proportions as the partial Surren-
der or full Surrender amount. The Free Surrender Amount equals 10% of
the Contract Balance as of the end of the immediately preceding
Contract Year. Contract Owners may elect to receive 10% of the
Contract Balance in multiple installments each contract year. Any
amount redeemed during the year in excess of this 10% amount will be
subject to a Surrender Charge (and any applicable Interest Rate Factor
Adjustment); and
6. Partial Surrenders or full Surrenders of Contracts issued in exchange
for Variable Annuity Contracts issued by Connecticut Mutual through
its Panorama Separate Account which are beyond any applicable
Surrender Charge period.
7. No sales charge will be imposed upon the redemption of a Contract
purchased and used in connection with a Qualified Plan that purchases
Tax Sheltered Annuities if such redemption occurs prior to May 1,
1998.
More information about how the Surrender Charge is calculated for partial
Surrenders and full Surrenders is contained in Appendices I and III attached
hereto.
In the case of a partial Surrender, the Surrender Charge will be deducted from
the Contract Balance remaining after payment of the requested Surrender amount,
or from the amount paid if sufficient balances do not remain in the Sub-Account
or General Account to which the Surrender is allocated.
Until April 30, 1997, no sales charges will be imposed upon redemption of a
Contract where the proceeds of such redemption are applied to the purchase of a
new MassMutual group annuity contract. This waiver does not eliminate applicable
charges under the particular group contract, and upon surrender of the group
contract, charges may apply.
No sales charge will be imposed upon redemption of "excess contributions,"
including "excess aggregate contributions," made to a Contract purchased and
used in connection with plans qualifying for favorable tax treatment ("Qualified
Contract"), including certain Qualified Pension and Profit Sharing Plans,
Individual Retirement Accounts and Tax-Sheltered Annuities. (See Tax Status -
Qualified Plans). The terms of such plans may permit the refund of contributions
made in excess of certain limitations specified in the Code and applicable
regulations. In the event of a refund of excess contributions, no sales charge
will be imposed upon the amount refunded. For purposes of the Contract, "excess
contributions" and "excess aggregate contributions" will be defined as provided
in U.S. Treasury Regulations.
C.M. Life anticipates that the Surrender Charge will not generate sufficient
funds to pay the cost of distributing the Contracts. If this charge is
insufficient to cover distribution expenses, the deficiency will be met from
C.M. Life's general funds, which will include amounts derived from the charge
for mortality and expense risks.
C.M. LIFE GUARANTEES THAT THE AGGREGATE SURRENDER CHARGE WILL NEVER EXCEED 8.5%
OF THE TOTAL PURCHASE PAYMENTS MADE UNDER THE CONTRACT.
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Interest Rate Factor Adjustment
The amount of General Account Balance partially or fully Surrendered during the
Accumulation Period, and the total General account Balance on the Annuity Income
Date (if and to the extent that the General Account Balance is applied to a
Variable Annuity Option), will be subject to an Interest Rate Factor Adjustment.
The Interest Rate Factor Adjustment is based on interest rates payable on U.S.
Treasury securities. In general, if rates on U.S. Treasury securities are higher
when you Surrender than when you made the applicable Purchase Payments, a
negative Interest Rate Factor Adjustment will generally be applied to the amount
Surrendered, and you could receive an amount lower than the amount of Purchase
Payments made. If rates on U.S. Treasury securities are lower when you Surrender
than when you made the applicable Purchase Payments, a positive Interest Rate
Factor Adjustment will generally be applied to the amount Surrendered, and you
could receive an amount higher than the amount of Purchase Payments made. No
Interest Rate Factor Adjustment will be applied during the Window Period. In
addition, no Interest Rate Factor Adjustment will be applied to the general
Account Free Surrender Amount or to Contracts issued to Pennsylvania residents.
Further information about the General Account and the Interest Rate Factor
Adjustment can be found in the prospectus for the Fixed Account with Interest
Rate Factor Adjustment attached hereto and in Appendix II.
Mortality and Expense Risk Charge
C.M. Life imposes a daily charge as compensation for bearing certain mortality
and expense risks in connection with the Contracts. This charge currently is
1.07% annually (equal to a daily rate of 0.002932%). It may increase, but it
will not exceed an effective annual rate of 1.25% of the average daily value of
net assets in the Separate Account. (The approximate portion of this charge
estimated to be attributable to mortality risks is 0.42%; the approximate
portion of this charge estimated to be attributable to expense risks is 0.65%.)
The Mortality and Expense Risk Charge is reflected in the Accumulation Unit
value or Annuity Unit value for the Contract for each Sub-Account.
Contract Balances and Annuity Income payments are not affected by changes in
actual mortality experience nor by actual expenses incurred by C.M. Life. The
mortality risks assumed by C.M. Life arise from its contractual obligations to
make Annuity Income payments (determined in accordance with the annuity tables
and other provisions contained in the Contract), and to pay Death Benefits prior
to the Annuity Income Date. Thus, Contract Owners are assured that neither the
Annuitant's own longevity, nor an unanticipated improvement in general life
expectancy, will adversely affect the Annuity Income payments that the Annuitant
will receive under the Contract.
C.M. Life also bears substantial risk in connection with the Death Benefit.
During the Accumulation Period C.M. Life will, if the deceased Annuitant or
Contract Owner was a natural person less than age 75 at death, pay a Death
Benefit equal to the greater of (a) the Contract Balance, or (b) the Purchase
Payments less any prior partial surrenders and charges. Otherwise, the Death
Benefit is based on the Contract Balance. The Death Benefit is paid without
imposition of a Surrender Charge or the Interest Rate Factor Adjustment.
The expense risk assumed by C.M. Life is the risk that C.M. Life's actual
expenses in administering the Contract and the Separate Account will exceed the
amount recovered through Administrative Charges.
If the Mortality and Expense Risk Charge is insufficient to cover C.M. Life's
actual costs, C.M. Life will bear the loss. Conversely, if the charge is more
than sufficient to cover costs, the excess will be profit to C.M. Life. C.M.
Life expects a profit from this charge. To the extent that the Surrender Charge
is insufficient to cover the actual cost of Contract distribution, the
deficiency will be met from C.M. Life's general corporate assets, which may
include amounts derived from the Mortality and Expense Risk Charge.
Administrative Charges
In order to cover the costs of administering the Contracts and the Separate
Account, C.M. Life deducts a Contract Maintenance Fee from the Contract Balance
of each Contract, and also deducts a daily Administrative Expense Charge from
the assets of each Sub-Account of the Separate Account.
Contract Maintenance Fee. A Contract Maintenance Fee is deducted from the
Contract Balance of each Contract on the last day of each Contract Year during
the Accumulation Period, and upon full Surrender of the Contract. The charge is
not deducted after the Annuity Income Date. This Contract Maintenance Fee
currently is $30 per Contract per Contract Year. It may be increased, but will
not exceed $60. C.M. Life does not anticipate realizing any profit from this
charge. The Contract Maintenance Fee will be deducted pro rata from the
Sub-Accounts in the Separate Account and the General Account, in the same
proportion that the amount of Contract Balance in each Sub-Account and the
General Account bears to the total Contract Balance. For Contracts issued to
Pennsylvania residents, the Fee will be calculated as a pro rata portion of the
balance of each Sub-Account.
Administrative Expense Charge. C.M. Life also deducts a daily Administrative
Expense Charge from the assets of each Sub-Account of the Separate Account. This
charge is currently at an effective annual rate of 0.07% (equal to a daily rate
of 0.000192%). C.M. Life does not anticipate realizing any profit from this
charge. The Administrative Expense Charge may be increased in the future, but
the combined total of the Administrative Expense Charge and the Mortality and
Expense Risk Charge will never exceed an effective annual rate of 1.50% of the
average daily value of net assets in the Separate Account.
Premium Taxes
C.M. Life may pay Premium Taxes in connection with Purchase Payments under the
Contracts. Depending upon applicable state law, C.M. Life will deduct the
Premium Taxes paid with respect to a particular Contract from the Purchase
Payments, from the Contract Balance on the Annuity Income Date (thus reducing
the Contract Balance), or upon the full Surrender of a Contract. Premium Taxes
currently range from 0% to 4.28% of Purchase Payments.
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Federal, State and Local Taxes
No charges are currently made for federal, state, or local taxes other than
Premium Taxes. However, C.M. Life reserves the right to deduct charges in the
future for such taxes, or other economic burden resulting from the application
of any tax laws that C.M. Life determines to be attributable to the Contracts.
Other Expenses Including
Investment Advisory Fees
Each Portfolio of the Funds is responsible for all of its expenses. In addition,
charges will be made against each Portfolio of the Funds for investment advisory
services provided to the Funds or the Portfolio. The net assets of each
Portfolio of the Funds will reflect deductions in connection with investment
advisory fees and other expenses.
For more information concerning investment advisory fees and other charges
against the Portfolios, see the prospectuses for the Funds, a current copy of
which accompanies this Prospectus.
Distributor Of The Contracts
Effective May 1, 1996, MML Distributors, LLC ("MML Distributors") 1414 Main
Street, Springfield, MA 01144-1013, an affiliate of C.M. Life, became the
principal underwriter of the Contracts pursuant to an Underwriting and Servicing
Agreement to which MML Distributors and C.M. Life on behalf of the Separate
Account are parties. Since March 1, 1996, MML Investors Services, Inc.
("MMLISI"), also located at 1414 Main Street, Springfield, MA 01144-1013, has
served as the co-underwriter of the Contracts. Both MML Distributors and MMLISI
are registered with the Securities and Exchange Commission ("SEC") as
broker-dealers under the Securities Exchange Act of 1934 and are members of the
National Association of Securities Dealers, Inc.
("NASD").
MML Distributors may enter into selling agreements with respect to the Contracts
with other broker-dealers that are registered with the SEC and are members of
the NASD ("selling brokers"). Contracts are sold through agents who are licensed
under applicable insurance law to sell the Contracts. These agents are also
registered representatives of selling brokers or of MMLISI.
MML Distributors does business as MML Distributors, L.L.C. in the states of
Illinois, Michigan, Oklahoma, South Dakota and Washington, and as MML
Distributors, Limited Liability Company in the states of Maine, Ohio and West
Virginia.
Commissions of up to 6.0% of Purchase Payments are paid on Contract sales.
General Provisions
Assignment of the Contract
A Written Request specifying the terms of an assignment of the Contract must be
provided to the Annuity Service Center. Until the Written Request is received at
the Annuity Service Center, C.M. Life will not be required to take notice of, or
be responsible for, any transfer of interest in the Contract by assignment,
agreement, or otherwise.
C.M. Life will not be responsible for the validity or tax consequences of any
assignment. Any assignment made after the Death Benefit has become payable will
be valid only with C.M. Life's consent.
If the Contract is assigned, the Contract Owner's rights may only be exercised
with the consent of the assignee of record.
Contract Changes by C.M. Life
C.M. Life reserves the right to amend the Contract to meet the requirements of
any applicable federal or state laws or regulations, or to make other changes
permitted by the Contract. C.M. Life will notify the Contract Owner in writing
of any such amendments.
Any changes to the Contract by C.M. Life must be signed by an authorized officer
of C.M. Life. Agents of C.M. Life have no authority to alter or modify any of
the terms, conditions, agreements of the Contract, or to waive any of its
provisions.
Contract Termination
The Contract will terminate upon the occurrence of any of the following events:
1. The date of the last Annuity Income payment;
2. The date payment is made of the Contract Balance;
3. The date of the last Death Benefit payment to the last Beneficiary;
4. The date the Contract is returned under the Right to Examine Contract
provision; or
5. Failure to maintain the required Minimum Contract Balance.
Incontestability
The Contract is incontestable.
Misstatement of Age or Sex
If the Annuitant's age or sex has been incorrectly stated, the Annuity Income
payable will be that which the Contract Balance, reduced by any applicable
Premium Tax, would have purchased at the correct age and sex. After correction,
the Annuitant will receive the sum of any underpayments made by C.M. Life within
thirty (30) calendar days. The amounts of any overpayments made by C.M. Life
will be charged against the payment(s) following the correction.
Nonparticipating
The Contract is nonparticipating and will not share in any surplus earnings of
C.M. Life. No dividends are payable on the Contract.
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Non-Business Days
If the due date for any activity required by the Contract falls on a
non-business day for C.M. Life, performance will be rendered on the first
business day following the due date.
Regulatory Requirements
All interest guarantees, surrender benefits, and amounts payable at death will
not be less than the minimum benefits approved under the laws and regulations of
the state in which the Contract is delivered.
C.M. Life will administer the Contract in accordance with the U.S. tax laws and
regulations in order to retain its status as an annuity contract.
Right to Examine Contract
No Surrender Charge will be applied if the Contract Owner returns the Contract
for cancellation during the first fifteen (15) calendar days following the
Contract Issue Date (or a longer period, if required by law). In addition, no
Interest Rate Factor Adjustment, or Contract Maintenance Fee or premium tax will
be applied upon such a cancellation. C.M. Life will refund the Separate Account
Balance and/or any Purchase Payments made to the General Account upon return of
the Contract. If required by state law, C.M. Life will refund any Purchase
Payment regardless of whether they were allocated to one or more Sub-Account or
to the General Account.
Tax Status
General
Note: the following description is based upon the Company's understanding of
current federal income tax law applicable to annuities in general. The Company
cannot predict the probability that any changes in such laws will be made.
Purchasers are cautioned to seek competent tax advice regarding the possibility
of such changes. This discussion is based upon C.M. Life's understanding of the
present Federal income tax laws as they are currently interpreted by the
Internal Revenue Service. No representation is made as to the likelihood of the
continuation of the present Federal income tax laws, or of the current
interpretation by the Internal Revenue Service. It should be further understood
that the following discussion is not exhaustive and that special rules not
described in this prospectus may be applicable in certain situations. Moreover,
no attempt has been made to consider any applicable state or other tax laws.
Section 72 of the Code governs taxation of annuities in general. A Contract
Owner is generally not taxed on increases in the value of a Contract until
distribution occurs, either in the form of a lump sum payment or other
non-periodic distribution or as Annuity Payments under the Annuity Option
selected. For a lump sum payment received as a total withdrawal (total
surrender), the recipient is taxed on the portion of the payment that exceeds
the cost basis of the Contract. For Non-Qualified Contracts, this cost basis is
generally the Purchase Payments, while for Qualified Contracts there may be no
cost basis. The taxable portion of the lump sum payment is taxed at ordinary
income tax rates.
For Annuity Payments, a portion of each payment in excess of an exclusion amount
is includible in taxable income. The exclusion amount for payments based on a
fixed Annuity Option is determined by multiplying the payment by the ratio that
the cost basis of the Contract (adjusted for any period certain or refund
feature) bears to the expected return under the Contract. The exclusion amount
for payments based on a variable Annuity Option is determined by dividing the
cost basis of the Contract (adjusted for any period certain or refund guarantee)
by the number of years over which the annuity is expected to be paid. Payments
received after the investment in the Contract has been recovered (i.e., when the
total of the excludable amounts received equal the investment in the Contract)
are fully taxable. The taxable portion is taxed at ordinary income tax rates.
For certain types of Qualified Plans there may be no cost basis in the Contract
within the meaning of Section 72 of the Code. Contract Owners, Annuitants, and
Beneficiaries under the Contracts should seek competent financial advice about
the tax consequences of any distributions.
The Company is taxed as a life insurance company under the Code. For federal
income tax purposes, the Separate Account is not a separate entity from the
Company and its operations form a part of the Company.
Diversification
Section 817(h) of the Code imposes certain diversification standards on the
underlying assets of variable annuity contracts. The Code provides that a
variable annuity contract will not be treated as an annuity contract for any
period (and any subsequent period) for which the investments are not, in
accordance with regulations prescribed by the United States Treasury Department
("Treasury Department"), adequately diversified. Disqualification of the
Contract as an annuity contract would result in the imposition of federal income
tax to the Contract Owner with respect to earnings allocable to the Contract
prior to the receipt of payments under the Contract. The Code contains a safe
harbor provision which provides that annuity contracts such as the Contract meet
the diversification requirements if, as of the end of each quarter, the
underlying assets meet the diversification standards for a regulated investment
company and no more than 55% of the total assets consist of cash, cash items,
U.S. Government securities and securities of other regulated investment
companies.
On March 2, 1989, the Treasury Department issued Regulations (Treas. Reg.
1.817-5), which established diversification requirements for the investment
portfolios underlying variable contracts such as the Contract. The Regulations
amplify the diversification requirements for variable contracts set forth in the
Code and provide an alternative to the safe harbor provision described above.
Under the Regulations, an investment portfolio will be deemed adequately
diversified if: (1) no more than 55% of the value of the total assets of the
portfolio is represented by any one investment; (2) no more than 70% of the
value of the total assets of the portfolio is represented by any two
investments; (3) no more than 80% of the value of the total assets of the
portfolio is represented by any three investments; and (4) no more than 90% of
the value of the total assets of the portfolio is represented by any four
investments.
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The Code provides that, for purposes of determining whether or not the
diversification standards imposed on the underlying assets of variable contracts
by Section 817(h) of the Code have been met, "each United States Government
agency or instrumentality shall be treated as a separate issuer."
The Company intends that all Portfolios of the Trust underlying the Contracts
will be managed by the Investment Adviser for the Trust in such a manner as to
comply with these diversification requirements.
The Treasury Department has indicated that the diversification Regulations do
not provide guidance regarding the circumstances in which Contract Owner control
of the investments of the Separate Account will cause the Contract Owner to be
treated as the owner of the assets of the Separate Account, thereby resulting in
the loss of favorable tax treatment for the Contract. At this time it cannot be
determined whether additional guidance will be provided and what standards may
be contained in such guidance.
The amount of Contract Owner control which may be exercised under the Contract
is different in some respects from the situations addressed in published rulings
issued by the Internal Revenue Service in which it was held that the policy
owner was not the owner of the assets of the separate account. It is unknown
whether these differences, such as the Contract Owner's ability to transfer
among investment choices or the number and type of investment choices available,
would cause the Contract Owner to be considered as the owner of the assets of
the Separate Account resulting in the imposition of federal income tax to the
Contract Owner with respect to earnings allocable to the Contract prior to
receipt of payments under the Contract.
In the event any forthcoming guidance or ruling is considered to set forth a new
position, such guidance or ruling would generally be applied only prospectively.
However, if such ruling or guidance was not considered to set forth a new
position, it may be applied retroactively resulting in the Contract Owner being
retroactively determined to be the owner of the assets of the Separate Account.
Due to the uncertainty in this area, the Company reserves the right to modify
the Contract in an attempt to maintain favorable tax treatment.
Multiple Contracts
The Code provides that multiple Non-Qualified annuity contracts which are issued
within a calendar year to the same contract owner by one company or its
affiliates are treated as one annuity contract for purposes of determining the
tax consequences of any distribution. Such treatment may result in adverse tax
consequences including more rapid taxation of the distributed amounts from such
combination of contracts. Contract Owners should consult a tax adviser prior to
purchasing more than one Non-Qualified annuity Contract in any calendar year.
Tax Treatment of Assignments
A transfer of ownership, assignment or pledge of a Contract may be a taxable
event. Contract Owners should therefore consult competent tax advisers should
they wish to transfer, assign or pledge their Contracts.
Income Tax Withholding
All distributions or the portion thereof which is includible in the gross income
of a payee are subject to federal income tax withholding. Generally, amounts are
withheld from periodic payments at the same rate as wages and at the rate of 10%
from non-periodic payments. However, the payee, in most cases, may elect not to
have taxes withheld or to have withholding done at a different rate. Special
rules limit the ability of a payee to elect no withholding where the payee fails
to provide a U.S. residence address or federal taxpayer identification number.
Effective January 1, 1993, certain distributions from Qualified Plans under
Section 401, which are not directly rolled over to another eligible retirement
plan or individual retirement account or individual retirement annuity, are
subject to a mandatory 20% withholding for federal income tax. The 20%
withholding requirement does not apply to: a) distributions for the life or life
expectancy of the participant or joint lives or joint life expectancies of the
participant and a designated beneficiary; or b) distributions for a specified
period of ten (10) years or more; or c) distributions which are required minimum
distributions. Payments that are not eligible for rollover remain subject to the
withholding rules described in the preceding paragraph.
Tax Treatment of Withdrawals -
Non-Qualified Contracts
Section 72 of the Code governs treatment of distributions from annuity
contracts. It provides that if the Contract Value exceeds the aggregate purchase
payments made, any amount withdrawn will be treated as coming first from the
earnings and then, only after the income portion is exhausted, as coming from
the principal. Withdrawn earnings are includible in gross income.
Penalty Tax
A 10% penalty will apply to the income portion of any distribution. However, the
penalty is not imposed on amounts received: (a) after the taxpayer reaches age
591/2; (b) after the death of the Contract Owner; (c) if the taxpayer has become
totally disabled (for this purpose disability is as defined in Section 72(m)(7)
of the Code); (d) in a series of substantially equal periodic payments made not
less frequently than annually for the life (or life expectancy) of the taxpayer
or for the joint lives (or joint life expectancies) of the taxpayer and his or
her Beneficiary; (e) under an immediate annuity; or (f) which are allocable to
purchase payments made prior to August 14, 1982.
The above information does not apply to Qualified Contracts. However, separate
tax withdrawal penalties and restrictions may apply to such Qualified Contracts.
(See Tax Treatment of Withdrawals - Qualified Contracts.)
Qualified Plans
The Contract is designed for use with several types of Qualified Plans. The tax
rules applicable to Contract Owners in Qualified Plans, including restrictions
on contributions and
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benefits, taxation of distributions, and any tax penalties, vary according to
the type of plan and the terms and conditions of the plan itself. Various tax
penalties may apply to contributions in excess of specified limits, aggregate
distributions in excess of $160,000 annually, adjusted from time to time,
distributions that do not satisfy specified requirements, and certain other
transactions with respect to Qualified Plans. Therefore, no attempt is made to
provide more than general information about the use of the Contract with the
various types of Qualified Plans. Contract Owners, Annuitants and Beneficiaries
are cautioned that the rights of any person to any benefits under Qualified
Plans may be subject to the terms and conditions of the plans themselves,
regardless of the terms and conditions of the Contract. Some retirement plans
are subject to distribution and other requirements that are not incorporated in
the administration of the Contracts. Contract Owners are responsible for
determining that contributions, distributions and other transactions with
respect to the Contracts satisfy applicable law. Purchasers of Contracts for use
with any retirement plan should consult their legal counsel and tax adviser
regarding the suitability of the Contract. Following are brief descriptions of
the various types of Qualified Plans in connection with which C.M. Life will
issue the Contract. Contracts for all types of Qualified Plans may not be
available in all states. When issued in connection with a Qualified Plan, the
Contract will generally be subject to endorsement.
Qualified Pension and Profit Sharing Plans. Section 401(a) of the Code permits
corporate employers to establish various types of retirement plans for
employees. Such retirement plans may permit the purchase of the Contract in
order to provide benefits under the plans. Adverse tax consequences to the plan,
to the participant or to both may result if this Contract is assigned or
transferred to any individual as a means to provide benefit payments.
The Self-Employed Individuals' Tax Retirement Act of 1962, as amended, commonly
referred to as "H.R. 10," permits self-employed individuals to establish
Qualified Plans for themselves and their employees. Purchasers of a Contract for
use with such plans should seek competent advice regarding the suitability of
the proposed plan documents and the Contract to their specific needs.
Individual Retirement Annuities and Individual Retirement Accounts. Section 408
of the Code permits eligible individuals to contribute to an individual
retirement program known as an Individual Retirement Annuity, or Individual
Retirement Account (each hereinafter referred to as "IRA"). Individual
Retirement Annuities are subject to limitations on the amount that may be
contributed and deducted and the time when distributions may commence. Also,
distributions from certain other types of Qualified Plans may be "rolled over"
on a tax-deferred basis into an IRA. The sale of a Contract for use with an IRA
may be subject to special disclosure requirements of the Internal Revenue
Service. Purchasers of the Contract for use with IRAs will be provided with
supplemental information required by the Internal Revenue Service or other
appropriate agency. Such purchasers will have the right to revoke their purchase
within seven (7) days of the earlier of the establishment of the IRA, or their
purchase. Purchasers should seek competent advice as to the suitability of the
Contract for use with IRAs. Additional information regarding IRAs is provided in
Appendix IV.
Tax-Sheltered Annuities. Section 403(b) of the Code permits public school
employees, and employees of certain types of religious, charitable, educational,
and scientific organizations, specified in Section 501(c)(3) of the Code, to
purchase annuity contracts and, subject to certain limitations, exclude the
amount of premiums from gross income for tax purposes. However, these payments
may be subject to FICA (Social Security) taxes. These annuity contracts are
commonly referred to as "Tax-Sheltered Annuities." Subject to certain
exceptions, withdrawals under Tax-Sheltered Annuities which are attributable to
contributions made pursuant to salary reduction agreements are prohibited unless
made after the Contract Owner attains age 59 1/2, upon the Contract Owner's
separation from service, upon the Contract Owner's death or disability, or for
an amount not greater than the total of such contributions in the case of
hardship.
Section 457 Deferred Compensation ("Section 457") Plans. Under Section 457 of
the Code, employees of (and independent contractors who perform services for)
certain state and local governmental units, or certain tax-exempt employers, may
participate in a Section 457 plan of their employer, allowing them to defer part
of their salary or other compensation. The amount deferred, and any income on
such amount, will not be taxable until paid or otherwise made available to the
employee. Depending on the terms of the particular plan, the employer may be
entitled to draw on deferred amounts for purposes unrelated to its section 457
plan obligations. In general, all amounts received under a section 457 plan are
taxable.
The maximum amount that can be deferred under a Section 457 plan in any tax year
is ordinarily one-third of the employee's includable compensation, up to $7,500.
Includable compensation means earnings for services rendered to the employer
which is includable in the employee's gross income, but excluding any
contributions under the Section 457 plan, or a Tax-Sheltered Annuity. During the
last three (3) years before an individual attains normal retirement age,
additional "catch-up" deferrals are permitted.
The deferred amounts will be used by the employer to purchase the Contract. The
Contract will be issued to the employer, but for state and local governmental
457 plans, amounts have to be held for the exclusive benefit of plan
participants. For 457 plans for tax-exempt organizations, all Contract Values
will be subject to the claims of the employer's creditors. In either case, the
employee is only entitled to payment in accordance with the Section 457 plan
provisions. Present federal income tax law does not allow tax-free transfers or
rollovers for amounts accumulated in a Section 457 plan, except for transfers to
other Section 457 plans in certain limited cases.
Tax Treatment of Withdrawals -
Qualified Contracts
In the case of a withdrawal under a Qualified Contract, a ratable portion of the
amount received is taxable, generally based on the ratio of the individual's
cost basis to the individual's total accrued benefit under the retirement plan.
Special tax rules may be available for certain distributions from a Qualified
Contract.
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Section 72(t) of the Code imposes a 10% penalty tax on the taxable portion of
any distribution from qualified retirement plans, including Contracts issued and
qualified under Code Sections 401 (H.R. 10 and Corporate Pension and Profit-
Sharing Plans) and 408(b) (Individual Retirement Annuities). To the extent
amounts are not includible in gross income because they have been rolled over to
an IRA or to another eligible Qualified Plan, no tax penalty will be imposed.
The tax penalty will not apply to the following distributions: (a) if
distribution is made on or after the date on which the Contract Owner or
Annuitant (as applicable) reaches age 59 1/2; (b) distributions following the
death or disability of the Contract Owner or Annuitant (as applicable) (for this
purpose disability is as defined in Section 72(m)(7) of the Code); (c) after
separation from service, distributions that are part of substantially equal
periodic payments made not less frequently than annually for the life (or life
expectancy) of the Contract Owner or Annuitant (as applicable) or the joint
lives (or joint life expectancies) of such Contract Owner or Annuitant (as
applicable) and his or her designated Beneficiary; (d) distributions to a
Contract Owner or Annuitant (as applicable) who has separated from service after
he/she has attained age 55; (e) distributions made to the Contract Owner or
Annuitant (as applicable) to the extent such distributions do not exceed the
amount allowable as a deduction under Code Section 213 to the Contract Owner or
Annuitant (as applicable) for amounts paid during the taxable year for medical
care; and (f) distributions made to an alternate payee pursuant to a qualified
domestic relations order. The exceptions stated in (d) and (f) above do not
apply in the case of an Individual Retirement Annuity. The exception stated in
(c) above applies to an Individual Retirement Annuity without the requirement
that there be a separation from service. In addition, for calendar years
beginning January 1, 1997, withdrawals from IRAs by certain unemployed persons
for payment of health insurance premiums are not subject to the tax penalty.
Generally, distributions from a Qualified Plan of a 5% owner or from an IRA must
commence no later than April 1 of the calendar year, following the year in which
the employee attains age 70 1/2, and from all others in Qualified Plans at the
later of age 70 1/2 or when the employee retires. Required distributions must be
over a period not exceeding the life expectancy of the individual or the joint
lives or life expectancies of the individual and his or her designated
beneficiary. If the required minimum distributions are not made, a 50% penalty
tax is imposed as to the amount not distributed. In addition, distributions in
excess of $160,000 per year may be subject to an additional 15% excise tax
unless an exemption applies. For calendar years 1997, 1998 and 1999 the 15%
excise tax on excess distributions has been suspended and will be reinstated for
calendar years beginning January 1, 2000.
Restrictions Under Qualified Contracts. Other restrictions with respect to the
election, commencement, or distribution of benefits may apply under Qualified
Contracts or under the terms of the plans in respect of which Qualified
Contracts are issued.
General
At the time the initial Purchase Payment is paid, a prospective purchaser must
specify whether he or she is purchasing a Non-qualified Contract or a Qualified
Contract. If the initial Purchase Payment is derived from an exchange or
surrender of another annuity contract, C.M. Life may require that the
prospective purchaser provide information with regard to the federal income tax
status of the previous annuity contract. C.M. Life will require that persons
purchase separate Contracts if they desire to invest monies qualifying for
different annuity tax treatment under the Code. Each such separate Contract
would require the minimum initial Purchase Payment stated above. Additional
Purchase Payments under a Contract must qualify for the same federal income tax
treatment as the initial Purchase Payment under the Contract. C.M. Life will not
accept an additional Purchase Payment under a Contract if the federal income tax
treatment of such Purchase Payment would be different from that of the initial
Purchase Payment.
Additional Information About
The Separate Account
Addition, Deletion or Substitution of
Investments
C.M. Life cannot and does not guarantee that any of the Sub-Accounts of the
Separate Account, or Portfolios of the Funds, will always be available for
Purchase Payments, allocations, or transfers. C.M. Life retains the right to
make changes in the Separate Account and its investments.
C.M. Life reserves the right to eliminate the shares of any Portfolio held by a
Sub-Account, and to substitute shares of another Portfolio of the Funds, or of
another registered open-end management investment company, for the shares of any
Portfolio, if the shares of the Portfolio are no longer available for
investment, or if, in C.M. Life's judgment, investment in any Portfolio would be
inappropriate in view of the purposes of the Separate Account. To the extent
required by the 1940 Act, substitutions of shares attributable to the Contract
Owner's interest in a Sub-Account will not be made without prior notice to the
Contract Owner and the prior approval of the SEC. Nothing contained herein shall
prevent the Separate Account from purchasing other securities for other series
or classes of variable annuity policies, or from effecting an exchange between
series or classes of variable annuity policies on the basis of requests made by
Contract Owners.
New Sub-Accounts may be established when, at the sole discretion of C.M. Life,
marketing, tax, investment or other conditions warrant. Any new Sub-Accounts may
be made available to existing Contract Owners on a basis to be determined by
C.M. Life. Each additional Sub-Account will purchase shares in a Portfolio of
the Funds, or in another mutual fund or investment vehicle. C.M. Life may also
eliminate one or more Sub-Accounts if, at its sole discretion, marketing, tax,
investment or other conditions warrant such change. In the event any Sub-Account
is eliminated, C.M. Life will notify Contract Owners and request a reallocation
of the amounts invested in the eliminated Sub-Account.
In the event of any such substitution or change, C.M. Life may, by appropriate
endorsement, make such changes in the Contracts as may be necessary or
appropriate to reflect such substitution or change. Furthermore, if deemed to be
in the best interests of persons having voting rights under the Contracts,
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the Separate Account may be (i) operated as a management company under the 1940
Act or any other form permitted by law, (ii) deregistered under the 1940 Act in
the event such registration is no longer required, or (iii) combined with one or
more other separate accounts. To the extent permitted by applicable law, C.M.
Life also may transfer the assets of the Separate Account associated with the
Contracts to another account or accounts.
Performance Measures
C.M. Life may show the performance under the Contracts in the following ways:
Standardized Average Annual Total Return
C.M. Life will show the Standardized Average Annual Total Return for the
Sub-Accounts of the Separate Account which have been in existence for more than
one year. As prescribed by the rules of the SEC, the Standardized Average Annual
Total Return is the effective annual compounded rate of return that would have
produced the cash redemption value over the stated period had the performance
remained constant throughout. The Standardized Average Annual Total Return
assumes a single $1000 payment made at the beginning of the period and full
redemption at the end of the period. It reflects a deduction for the contingent
deferred sales charge, the annual Contract Maintenance Fee and all other Fund,
Separate Account, and Contract level charges except premium taxes, if any. The
annual Contract Maintenance Fee is apportioned among the Sub-Accounts based upon
the percentages of inforce Contracts investing in each of the Sub-Accounts.
The Company may choose to show Standardized Average Annual Total Returns based
on the inception of the underlying Fund.
Additional Performance Measures
The performance figures discussed in this section are calculated on the basis of
the historical performance of the Funds, and may assume the Contracts were in
existence prior to May 13, 1992 (which they were not). Beginning May 13, 1992
(inception date), actual Accumulation Unit values are used for the calculations.
The difference between the first set of additional performance measures,
ANNUALIZED RETURNS on Accumulation Unit Values, and the second set, the
NON-STANDARDIZED ANNUAL and AVERAGE ANNUAL TOTAL RETURNS, is that the second set
includes the deduction of the Annual Contract Maintenance Fee, the first set
does not. Additional details follow.
ACCUMULATION UNIT VALUES - ANNUALIZED RETURNS. The ANNUALIZED RETURN, or average
annual change in Accumulation Unit Values, may be shown with respect to one or
more periods. For a one year period, the ANNUALIZED RETURN is the effective
annual rate of return. For periods greater than one year, the ANNUALIZED RETURN
is the effective annual compounded rate of return for the periods stated. Since
the value of an Accumulation Unit reflects the Separate Account, the Panorama
Series Fund expenses and the Oppenheimer Fund expenses (See Table of Fees and
Expenses), the ANNUALIZED RETURN also reflects these expenses. These
percentages, however, do not reflect the Contract Maintenance Fee and the sales
charge or premium taxes (if any), which if included would reduce the percentages
reported.
The NON-STANDARDIZED ANNUAL TOTAL RETURN for a Sub-Account is the effective
annual rate of return that would have produced the ending Accumulated Value of
the stated one year period.
The NON-STANDARDIZED AVERAGE ANNUAL TOTAL RETURN for a Sub-Account is the
effective annual compounded rate of return that would have produced the ending
Accumulated Value over the stated period had the performance remained constant
throughout.
Note: The NON-STANDARDIZED ANNUAL TOTAL RETURN will be less than the
NON-STANDARDIZED ANNUALIZED RETURN on Accumulation Unit values for the same
period due to the effect of the Annual Contract Maintenance Fee. Additionally,
the magnitude of this difference will depend on the size of the Accumulated
Value from which the Annual Contract Maintenance Fee is deducted.
YIELD AND EFFECTIVE YIELD. C.M. Life may show yield and effective yield figures
for the Money Market Sub-Account over a seven-day period, which is
then"annualized". That is, the amount of income generated by the investment
during that week is assumed to be generated each week over a 52-week period and
is shown as a percentage of the investment. The "effective yield" is calculated
similarly but, when annualized, the income earned by an investment in the Money
Market Sub-Account is assumed to be re-invested. Therefore the effective yield
will be slightly higher than the yield because of the compounding effect of this
assumed reinvestment. These figures do not reflect the Annual Contract
Maintenance Fee, the contingent deferred sales charge or premium taxes (if any),
which if included would reduce the yields reported.
The performance measures discussed above reflect results of the Funds and are
not intended to indicate or predict future performance. For more detailed
information see the Statement of Additional Information.
Performance information for the Separate Account Sub-Accounts may be: (a)
compared to other variable annuity separate accounts or other investment
products surveyed by Lipper Analytical Services, a nationally recognized
independent reporting service or similar services that rank mutual funds and
other investment companies by overall performance, investment objectives and
assets; (b) tracked by other ratings services, companies, publications or
persons who rank separate accounts or other investment products on overall
performance or other criteria; and (c) included in data bases that can be used
to produce reports and illustrations by organizations such as CDA Wiesenberger
Performance figures will be calculated in accordance with standardized methods
established by each reporting service.
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C.M. Life may also show the application of general mathematical principles in
connection with the Contracts.
Voting Rights
There are no voting rights associated with the General Account Balance.
With respect to the Separate Account Balance, C.M. Life will be the
"shareholder" of the Funds, and as such, C.M. Life will have certain voting
rights. However, to the extent required by law, C.M. Life will vote the Funds
shares held by the Separate Account at regular and special shareholder meetings
of the Funds in accordance with instructions received from persons having voting
interests in the Portfolios. If, however, the 1940 Act or any regulation
thereunder should be amended, or if the present interpretation thereof should
change, and as a result C.M. Life determines that it is permitted to vote the
Funds' shares in its own right, it may elect to do so.
Before the Annuity Income Date, the Contract Owner holds the voting interest in
the selected Portfolios. The number of votes that the Contract Owner has the
right to instruct will be calculated separately for each Sub-Account. The number
of votes that the Contract Owner has the right to instruct for a particular
Sub-Account will be determined by dividing his or her Contract Balance in the
Sub-Account by the net asset value per share of the corresponding Portfolio in
which the Sub-Account invests. Fractional shares will be counted.
After the Annuity Income Date, the person receiving Annuity Payments has the
voting interest, and the number of votes decreases as Annuity Payments are made
and as the reserves for the Contract decrease. The person's number of votes will
be determined by dividing the reserve for the Contract allocated to the
applicable Sub-Account by the net asset value per share of the corresponding
Portfolio of the Funds. Fractional shares will be counted.
The number of votes that the Contract Owner, or person receiving income
payments, has the right to instruct will be determined as of the date
established by the Funds for determining shareholders eligible to vote at the
meeting of the Funds. C.M. Life will solicit voting instructions by sending
Contract Owners, or other persons entitled to vote, written requests for
instructions prior to that meeting, in accordance with procedures established by
the Funds. Portfolio shares for which no timely instructions are received may be
voted in proportion to the voting instructions that are received with respect to
all Contracts participating in the same Sub-Account. Shares held by C.M. Life or
its affiliates, in which Contract Owners or other persons entitled to vote have
no beneficial interest, may be voted by the shareholder thereof (C.M. Life or
its affiliates) at its sole discretion.
Each person having a voting interest in a Sub-Account will receive proxy
material, reports, and other materials relating to the appropriate Portfolio.
It should be noted that the Funds are not required to, and do not intend to,
hold annual or other regular meetings of shareholders.
Legal Proceedings
C.M. Life is not involved in any litigation that is of material importance in
relation to its General Account assets. In addition, there are no legal
proceedings to which the Separate Account is a party.
Available Information
C.M. Life is subject to the informational requirements of the Securities
Exchange Act of 1934, and, in accordance therewith, files reports and other
information with the SEC. Such reports and other information can be inspected
and copied at the public reference facilities of the SEC, at Room 1024, 450
Fifth Street, N.W., Washington, D.C. 20549. Copies of such materials also can be
obtained from the Public Reference Section of the Commission, at 450 Fifth
Street, N.W., Washington, D.C. 20549, at prescribed rates.
C.M. Life has filed registration statements (the "Registration Statements") with
the SEC under the Securities Act of 1933 relating to the Contracts offered by
this Prospectus. This Prospectus has been filed as part of the Registration
Statements, and does not contain all of the information set forth in the
Registration Statements. Reference is hereby made to such Registration
Statements for further information relating to C.M. Life and the Contracts. The
Registration Statements may be inspected and copied, and copies can be obtained
at prescribed rates in the manner set forth in the preceding paragraph.
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Appendix I
Surrender Charge Calculation
A Surrender Charge is deducted from the Contract Balance upon partial or full
Surrender of the Contract, unless certain conditions apply. (See "Surrender
Charge," page 32.)
The partial surrender charge formula is calculated as follows:
(PS - FREE) _ 5%(95%) = PSC, but not less than zero.
The full surrender charge formula is calculated as follows:
(FS - FREE) _ 5% = FSC.
Where:
(PS) is the Partial Surrender Amount.
(FS) is the Full Surrender Amount.
(FREE) is the Free Surrender Amount.
(PSC) is the Partial Surrender Charge Amount.
(FSC) is the Full Charge Amount.
Example
Assume a Separate Account Balance of $50,000 at the beginning of the second
Contract Year.
1) If there is a Full Surrender at the beginning of the second Contract
Year:
Surrender Charge =
($50,000 - $5,000) _ .05 = $2,250.00.
Thus, the Surrender proceeds would be = $50,000 - $30 - $2,250.00 =
$47,720.00
Note: The contract maintenance fee ($30) applies to full surrenders.
2) If there is a Partial Surrender of $10,000 at the beginning of the
second Contract Year:
Surrender Charge =
($10,000 - $5000) _ .05/.95 = $263.16.
Thus, the Separate Account Balance would be reduced by $10,000 +
$263.16 = $10,263.16.
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Appendix II
Interest Rate Factor Adjustment Calculation
The amount of General Account Balance partially or fully Surrendered during the
Accumulation Period, and the total General Account Balance on the Annuity Income
Date (if and to the extent that the General Account Balance is applied to a
Variable Annuity Option), will be subject to an Interest Rate Factor Adjustment.
The Interest Rate Factor Adjustment is based on interest rates payable on U.S.
Treasury securities. In general, if rates on U.S. Treasury securities are higher
when you Surrender than when you made the applicable Purchase Payments, a
negative Interest Rate Factor Adjustment will generally be applied to the amount
Surrendered, and you could receive an amount lower than the amount of Purchase
Payments made. If rates on U.S. Treasury securities are lower when you Surrender
than when you made the applicable Purchase Payments, a positive Interest Rate
Factor Adjustment will generally be applied to the amount Surrendered, and you
could receive an amount higher than the amount of Purchase Payments made. No
Interest Rate Factor Adjustment will be applied during the Window Period. In
addition, no Interest Rate Factor Adjustment will be applied to the General
Account Free Surrender Amount or to Contracts issued to Pennsylvania residents.
The Interest Rate Factor Adjustment will reflect the relationship between (i)
the weighted average of U.S. Treasury Index Rates corresponding to Purchase
Payments and Transfers into the General Account during the current Five-Year
Period (as adjusted for partial Surrenders or Transfers out of the General
Account), (ii) the U.S. Treasury Index Rate which would be applicable during the
time remaining in the current Five-Year Period on the date of the Surrender, and
(iii) the time remaining in the current Five-Year Period. In general, if the
weighted average of U.S. Treasury Index Rates corresponding to Purchase Payments
and Transfers during the current Five-Year Period is lower than the U.S.
Treasury Index Rate which would be applicable during the time remaining in the
current Five-Year Period, then the application of the Interest Rate Factor
Adjustment will result in a lower payment upon Surrender.
The partial surrender Interest Rate Factor Adjustment Formula is:
(1 - 1/IRF) X (GAPS - GAF + GAPSC) = IRFA.
In the event of a Partial Surrender, there is no Interest Rate Factor Adjustment
if the General Account Free Surrender Amount exceeds the General Account portion
of such Partial Surrender.
The full surrender Interest Rate Factor Adjustment Formula is:
(IRF - 1) X (GAFS - GAF) = IRFA.
Where:
(GAPS) is the General Account Partial Surrender Amount.
(GAFS) is the General Account Full Surrender Amount.
(GAF) is the General Account Free Surrender Amount.
(GAPSC) is the General Account portion of the Partial Surrender Charge
Amount determined as follows:
GAPSC = (GAPS - GAF) X 5%/95%, but not less than zero.
(IRF) is the Interest Rate Factor.
(IRFA) is the Interest Rate Factor Adjustment.
The Interest Rate Factor is determined by the following formula:
(N/12)
(1 + Ta)
------------------------------ = IRF
(N/12)
(1.003 + Tb)
Where:
(Ta) is the weighted average of the U.S. Treasury Index Rates which
correspond to the Purchase Payments and/or Transfers allocated to the
General Account during the current Five-Year Period. The U.S. Trea- sury
Index Rate corresponding to each such alloca- tion is determined by the
number of full years and fractions thereof (but not less than one (1) year)
remaining from the date of the allocation until the end of the current
Five-Year Period. For purposes of determining the average of these rates,
each U.S. Treasury Index Rate is weighted by the amount of the
corresponding allocation (as adjusted to reflect any partial Surrenders
and/or transfers from the Gen- eral Account subsequent to such allocation).
The General Account Balance at the beginning of any Five-Year Period will
be treated as a new allocation for purposes of this calculation.
Each allocation made prior to a Partial Surrender and/or transfer
from the General Account (other than the current Surrender) shall
be adjusted by multiplying such allocation by the following
fraction:
1 - PS/GAB
Where:
(PS) is the amount of the Partial Surrender and/or transfer
from the General Account made subsequent to the
allocation,
(GAB) is the beginning General Account Balance on the date of such
Partial Surrender and/or transfer from the General Account, A
separate adjustment shall be calculated for each prior Partial
Surrender and/or transfer from the General Account.
(Tb) is the U.S. Treasury Index Rate with a maturity equal to the
number of full years and fractions thereof (but not less than
one (1) year) remaining in the current Five-Year Period on the
date of the Partial or Full Surrender,
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(N) is the number of whole months remaining in the current
Five-Year Period as of the date of the Partial or Full
Surrender (rounded down),
1.003 builds into the formula a factor representing direct and
indirect costs to C.M. Life associated with liquidating
General Account assets in order to satisfy Surrender
requests or to begin making Annuity Income payments (to
the extent the General Account Balance is applied to
purchase a Variable Annuity). This adjustment of .30%
has been added to the denominator of the formula because
it is anticipated that a substantial portion (more than
half) of applicable General Account portfolio assets
will be in relatively illiquid private placement
securities. Thus, in addition to direct transaction
costs, if such securities must be sold (e.g., because of
Surrenders), the market price may be lower because they
are not registered securities. Accordingly, even if
interest rates decline, there will not be a positive
adjustment until this factor is overcome, and then any
adjustment will be lower than otherwise, to compensate
for this factor. Similarly, if interest rates rise, any
negative adjustment will be greater than otherwise, to
compensate for this factor. If interest rates stay the
same, this factor will result in a small but negative
Interest Rate Factor Adjustment.
(IRF) is the Interest Rate Factor.
Examples. The following examples illustrate the calculation of the Interest Rate
Factor and the Interest Rate Factor Adjustment.
In the following examples, the Interest Rate Factor Adjustment formula is
applied so as to produce only positive numbers, which are then added to, or
subtracted from, the Surrender proceeds (for Full General Account Balance
Surrenders) or the remaining General Account Balance (for Partial General
Account Balance Surrenders). For example, if the Interest Rate Factor is .7,
then the Interest Rate Factor Adjustment calculation illustrated below will show
1-.7, rather than .7-1, to result in a positive number.
For examples 1 and 2, assume no change in interest rates.
1) Assume a $50,000 General Account Balance at the beginning of the
second Five-Year Period, and a Full Surrender at that time.
Also, assume the U.S. Treasury Index Rate at that time is 7%.
(5)
THEN: IRF = (1.07)
----------------- = .9861
(1.073)
Interest Rate Factor Adjustment [deducted from proceeds] =
(1 - .9861) X ($50,000 - $5,000) = $625.50.
2) Assume a $50,000 General Account Balance at the beginning of the tenth
Contract Year with a Full Surrender at that time.
Also, assume the U.S. Treasury Index Rate remains at 7% for all
maturities:
THEN: IRF = 1.07 = .9972
--------
1.073
Interest Rate Factor Adjustment [deducted from proceeds] =
(1 - .9972) X ($50,000 - $5,000) = $126.00.
For examples 3 and 4, assume a General Account Balance of $50,000 at the
beginning of the seventh Contract Year.
3) Assume a Full Surrender at the beginning of the seventh Contract Year:
a) Assume that the beginning U.S. Treasury Index Rate was 7%, and
the current U.S. Treasury Index Rate is 5.40%.
(This is a decrease in rates of 1.60%). Then the IRF = 1.05.
Interest Rate Factor Adjustment =
(1.05 - 1) X ($50,000 - $5,000) = $2,250.
Thus, the actual amount of Surrender proceeds paid = $50,000 +
$2,250- $30 = $52,220.
b) Assume that the beginning U.S. Treasury Index Rate was 7%, and
the current U.S. Treasury Index Rate is 8.08%.
(This is an increase in rates of 1.08%). Then the IRF = .95.
Interest Rate Factor Adjustment = (1 - .95) X ($50,000 - $5,000)
= $2,250.
Thus, the actual amount of Surrender proceeds paid = $50,000 -
$2,250 - $30 = $47,720.
Note: The contract maintenance fee ($30) applies to full
surrenders.
4) Assume a partial Surrender of $10,000 at the beginning of the
seventh Contract Year:
a) Assume that the beginning U.S. Treasury Index Rate was 7%, and
the current U.S. Treasury Index Rate is 5.40%.
(This is a decrease in rates of 1.60%). Then the IRF = 1.05.
Interest Rate Factor Adjustment =
1
(1 - -----) X ($10,000 - $5,000) = $238.10.
1.05
32
<PAGE>
Thus, the General Account Balance would be reduced by $10,000 -
$238.10 = $9,761.90.
b) Assume that the beginning U.S. Treasury Index Rate was 7%, and
the current U.S. Treasury Index Rate is 8.08%.
(This is an increase in rates of 1.08%). Then the IRF = .95.
Interest Rate Factor Adjustment =
1
(1 - ----- ) X ($10,000 - $5,000) = $263.16.
.95
Thus, the General Account Balance would be reduced by $10,000 -
$236.16 = $10,263.16.
33
<PAGE>
Appendix III
Examples
The following examples illustrate the impact of the Interest Rate Factor
Adjustment together with the Surrender Charge (See Appendix I.) on Surrender
proceeds. For examples 1 and 2, assume a General Account Balance of $50,000 at
the beginning of the second Contract Year.
1) Assume a Full Surrender at the beginning of the second Contract
Year.
a) Assume that the beginning U.S. Treasury Index Rate was 7%,
and the current U.S. Treasury Index Rate is 4.18%.
(This is a decrease in rates of 2.82%). Then the IRF = 1.10.
Surrender Charge = ($50,000 - $5,000) X .05 = $2,250.00.
Interest Rate Factor Adjustment =
(1.10 - 1) X ($50,000 - $5,000) = $4,500.00.
Thus, the actual amount of Surrender proceeds paid =
$50,000 - $2,250 + $4,500 - $30 = $52,220.00.
b) Assume that the beginning U.S. Treasury Index Rate was 7%,
and the current U.S. Treasury Index Rate is 9.56%.
(This is an increase in rates of 2.56%). Then the IRF = .9.
Surrender Charge = ($50,000 - $5,000) X .05 = $2,250.00.
Interest Rate Factor Adjustment = (1 - .9) X ($50,000 -
$5,000) = $4,500.00.
Thus, the actual amount of Surrender proceeds paid =
$50,000 - $2,250 - $4,500 - $30 = $43,220.00.
Note: The contract maintenance fee ($30) applies to full
surrenders.
2) Assume a partial Surrender of $10,000 at the beginning of the
second Contract Year.
a) Assume that the beginning U.S. Treasury Index Rate was 7%,
and the current U.S. Treasury Index Rate is 4.18%.
(This is a decrease in rates of 2.82%.) Then the IRF = 1.10.
Surrender Charge =
($10,000 - $5,000) X .05/.95 = $263.16.
Interest Rate Factor Adjustment =
1
(1 - ----- ) x ($10,000 - $5,000) = $478.47.
1.10
Thus, the General Account Balance will be reduced by $10,000
+ $263.16 - $478.47 = $9,784.69.
b) Assume that the beginning U.S. Treasury Index Rate was 7%,
and the current U.S. Treasury Index Rate is 9.56%.
(This is an increase in rates of 2.56%.) Then the IRF = .9.
Surrender Charge =
($10,000 - $5,000) X .05/.95 = $263.16.
Interest Rate Factor Adjustment =
(1 - 1.9) X ($10,000 - $5,000 + $263.16) = $584.80.
Thus, the General Account Balance will be reduced by $10,000
+ $263.16 + $584.80 = $10,847.96.
34
<PAGE>
Appendix IV
Individual Retirement Annuity Disclosure
This statement is designed to assist you in understanding the requirements of
federal tax law which apply to your Individual Retirement Annuity ("IRA"),
Spousal IRA or your Simplified Employee Pension IRA ("SEP-IRA") for employer
contributions. If you should desire further information regarding your IRA, it
may be obtained either from your MML Investors Services, Inc. ("MMLISI")
representative, from any district office of the Internal Revenue Service, or
from a competent tax adviser. The growth in the value of the annuity is neither
guaranteed nor projected.
Seven-Day Review Period
You have seven (7) days after you sign your application to review this statement
and the Prospectus without obligation. If you notify MMLISI or your
representative, either orally or in writing, within this seven-day period that
you do not wish to keep your Contract, your entire Purchase Payment will be
refunded to you.
Registered Representative:
Address: c/o MML Investors Services, Inc.
1414 Main Street
Springfield, Massachusetts 01144-1013
Telephone: (413) 737-8400
Eligibility Requirements
All persons with earned compensation are eligible for IRAs. Additionally, if you
have a spouse who has earned no compensation (and you file a joint tax return),
an IRA for your spouse may also be established. Of course, if you have a working
spouse who has earned compensation, that spouse may establish his or her own
IRA. Lastly, a divorced or legally separated spouse may treat taxable alimony or
separate maintenance payments as compensation for purposes of establishing an
IRA.
The Annuity as an IRA
When this Annuity is issued as an IRA, the Contract is amended to provide that
the Contract is both nontransferable and nonforfeitable.
Contributions and Deductions
As a result of significant changes made by the Tax Reform Act of 1986,
contributions to your IRA are limited at two levels. First, there are limits on
the amount of contributions which may be deducted for income tax purposes.
Second, there is a limit with respect to the amount of nondeductible
contributions which can be made. In addition, The Small Business Job Protection
Act of 1996 may also affect contributions and withdrawals from your IRA.
If neither you nor your spouse (if you file a joint return) is an active
participant in an employer-maintained retirement plan, then you are eligible to
make deductible contributions to an IRA equal to the lesser of 100% of
compensation or $2,000, $4,000 in the case of a Spousal IRA).
However, if you or your spouse (if you file a joint return) is an active
participant in an employer-maintained retirement plan, your deduction limit for
contributions to an IRA is reduced. Specifically, individuals with adjusted
gross income over $35,000, married taxpayers filing jointly with adjusted gross
income over $50,000, and a married taxpayer filing separately with adjusted
gross income over $10,000, are no longer allowed any IRA deductions if they
participate in an employer-maintained retirement plan. In the case of a married
couple filing jointly, the restrictions apply where either spouse so
participates. For single individuals with adjusted gross income between $25,000
and $35,000, married taxpayers filing jointly with adjusted gross income between
$40,000 and $50,000, and a married taxpayer filing separately with adjusted
gross income between $0 and $10,000, the IRA deduction will be phased out
ratably as income rises above the threshold limits.
Nevertheless, you may still make designated nondeductible IRA contributions to
the extent of the excess of (1) the lesser of $2,000, $4,000 in the case of a
Spousal IRA), or 100% of compensation annually, over (2) the applicable IRA
deduction limit. You may also choose to make a contribution nondeductible even
if you could have deducted part or all of the contribution. Interest or other
earnings on your IRA contribution, whether from deductible or nondeductible
contributions, will not be taxed until distributed to you.
For purposes of the above discussion, you are an "active participant" in an
employer-maintained retirement plan, if you are covered by such plan, even if
you are not yet vested in your retirement benefit. However, an individual who is
a participant in only an eligible state deferred compensation plan, as defined
in Internal Revenue Code section 457(b), is not considered to be an "active
participant."
In order to qualify for a particular tax year, IRA contributions must be made
during such tax year, or by the deadline for filing your income tax return for
that year (not including extensions). For calendar year taxpayers the deadline
is generally April 15.
If you make contributions in excess of the combined deductible and nondeductible
limits, you may be liable for a nondeductible excise tax of 6% of the amount of
the excess. You may withdraw an excess contribution together with the net income
attributable to the excess, on or before the due date (including extensions of
time) for filing your federal income tax return, and the excess amount will be
treated as if you never contributed it, regardless of the size of the
contribution. The accompanying distribution of the net income, however, is
includable in income for the year in which the excess contribution is made.
Excess amounts which are not withdrawn by this method are subject to the 6%
excise tax in the year of contribution, and are carried over and taxed each year
until the year the excess is reduced.
No contribution may be made by you to your IRA during or after the tax year in
which you attain age 70 1/2.
35
<PAGE>
Spousal IRAs
If your spouse has no compensation for the year and you file a joint return, you
may set up and make contributions to an IRA for your spouse, as well as for
yourself. Subject to the active participant rules discussed above, the maximum
amount that you can deduct for contributions to both IRAs is the lesser of
$4,000, or 100% of compensation. You may not contribute, however, more than
$2,000 to either IRA for any year.
SEP-IRAs
Under a SEP-IRA agreement, your employer may contribute 15% of your
compensation, up to $30,000 each year to your IRA. The contribution and interest
earned is excludable from your income until such time as it is distributed to
you.
You must withdraw any excess contribution made to your SEP-IRA by your employer
before the date for filing your return. If you do not, you are liable for the 6%
excise tax discussed above. SEP-IRAs are also generally subject to the other
requirements applicable to IRAs.
Rollover Contributions and Transfers
You are permitted to withdraw any portion of the value of your IRA and reinvest
it in another IRA account, but not more frequently than once in any twelve-month
period. Such withdrawals may also be made from other IRAs and contributed to
this contract. The amount of the withdrawal reinvested in another IRA within
sixty (60) days after the date it is received is called a "rollover
contribution" and is not subject to tax. Of course, you will not be allowed a
tax deduction for the amount of any rollover contribution. You may not roll over
IRA distributions required because you have reached age 70 1/2, or an IRA you
inherited as a beneficiary (unless you are the surviving spouse).
A similar type of rollover contribution can be made with the proceeds of an
eligible rollover distribution or a lump-sum distribution from a qualified
retirement plan. Such a distribution must also be invested in the IRA within
sixty (60) days of receipt. A lump sum distribution is one made from a Qualified
Plan (1) because of your death; (2) because you reached age 59 1/2; (3) because
you left your job (unless you are self-employed); or (4) because you become
permanently disabled (but only if you are self-employed). To be considered a
lump sum, the distribution must also be made entirely in a single tax year, and
must represent the entire value of your account in the retirement plan (and in
all plans of a similar type sponsored by the same employer). Properly made, such
a distribution will not be taxable until you receive payments from the IRA
created with it.
Eligible rollover distributions are generally all taxable distributions from
Qualified Plans and Section 403(b) annuities except for: (1) amounts paid over
your life or life expectancy; or (2) installments for periods spanning ten (10)
years or more; and (3) required minimum distributions.
Also, if you receive a distribution upon a plan termination, you may make a
rollover contribution to an IRA.
In addition to rollover contributions, you may have the assets of one IRA
directly transferred (without any distribution to you) to another IRA. Direct
IRA to IRA transfers are not subject to the one-year waiting period applicable
to IRA rollover contributions.
Withdrawals
In general, IRA withdrawals are taxable in full. If you have made both
deductible and nondeductible IRA contributions, the part of the withdrawal that
is from nondeductible contributions (not including interest) is excludable from
income. The amount excludable from income for the tax year is the portion of the
amount withdrawn that has the same ratio to the amount withdrawn as your total
nondeductible IRA contributions (of all your IRAs) have to the total balance of
all your IRAs, including rollover IRAs. The remaining portion of the amount
withdrawn for the tax year is includible in income. For purposes of this
calculation, all your IRAs are treated as one (1) contract, and all withdrawals
you make during a tax year are treated as one (1) distribution, and the value of
the contract (after adding back distributions made during the year), income on
the contract and investment in the contract are computed at the end of the year.
The special tax rules for lump sum distributions from pension plans do not apply
to IRAs.
Premature Distributions
Premature distributions are amounts you withdraw from your IRA before you are
age 59 1/2. Premature distributions which are not rolled over are subject to a
penalty tax equal to 10% of the amount of the distribution includible in gross
income in the tax year, unless you are totally disabled, or receive the
distributions in substantially equal payments (at least annually) for your life
or life expectancy, or the joint lives or life expectancies of you and your
beneficiary, or unless the distributions are made to your beneficiary upon your
death.
Effective for calendar years beginning January 1, 1997, withdrawals from IRAs
for payment of certain medical expenses, and withdrawals by certain unemployed
persons for payment of health insurance premiums, are not subject to the 10%
penalty tax under Section 72(t).
The penalty tax is also applicable to income taxable distributions deemed to
have been made upon disqualification of your IRA as a result of a prohibited
transaction (including, in general, the sale or assignment of your interest in
your IRA to anyone), or as a result of borrowing on your IRA, or using your IRA
as security for a loan.
Inadequate Distribution or
Underdistribution - 50% Tax
Your IRA is intended to provide retirement benefits over your lifetime. Thus,
federal law requires that you either (1) receive a lump sum distribution from
your IRA not later than April 1st of the year after the year in which you attain
age 70 1/2 or (2) start to receive periodic payments by that date. If you elect
to receive periodic payments, those payments must be sufficient to pay out the
entire value of your IRA during your life or life expectancy or over the life or
life expectancies of you and your beneficiary. If the payments are not
sufficient to meet
36
<PAGE>
these annual requirements, an excise tax of 50% will be imposed on the amount of
any underpayment.
Excess Distributions - 15% Tax
Certain persons, particularly those who participate in more than one (1)
tax-qualified retirement plan, may be subject to an excise tax of 15% on certain
excess aggregate distributions from those plans. In general, excess
distributions are taxable distributions from all tax-qualified plans in excess
of a specified annual limit for payments made in the form of an annuity
(generally, $160,000 for 1997, adjusted from time to time), or five (5) times
the annual limit for lump sum distributions.
Effective for calendar years 1997, 1998 and 1999, the 15% excise tax on excess
distributions has been suspended. That 15% tax will be reinstated for calendar
years beginning January 1, 2000.
Death Benefits
If you should die before receiving any benefits from your IRA, your beneficiary
must elect to either (1) receive the balance of your account in a lump sum
within five (5) years of your death, or (2) have the balance applied to purchase
an immediate annuity payable over the life or life expectancy of the
beneficiary. Such annuity must commence within one (1) year of your death. If
your spouse is your beneficiary, however, distributions are not required to be
distributed until the date you would have attained age 701/2, and if your spouse
dies before any distribution to him or her commences, your spouse is treated as
the owner of your IRA for purposes of any required distributions.
If you should die after benefits have commenced to you, the remaining portion of
your account must be distributed to your beneficiary as rapidly as under the
method of distribution in effect on the date of your death.
If you engage in certain prohibited transactions with your IRA, the IRA will
lose its exemption from taxation. Depending on the type of prohibited
transaction, you must include in income all or a portion of the fair market
value of the IRA account. Examples of prohibited transactions are: (1) any
borrowing from the account; (2) use of the account as security for a loan; (3)
receipt by you or certain family members of unreasonable compensation for
managing the IRA.
Prototype Status
The Internal Revenue Service currently has not been asked to review the format
of your C.M. Life Insurance Company ("C.M. Life") Prototype IRA or issue a
determination letter regarding the qualification of the prototype IRA. However,
an opinion letter is a determination only as to the form of the IRA, and does
not represent a determination as to its merits.
Reporting to the IRS
If you make a designated nondeductible contribution to an IRA for a taxable
year, or receive a distribution from an IRA during a taxable year, you are
required to provide such information as the IRS may prescribe on your tax return
for the taxable year and, to the extent required, for succeeding taxable years.
The information that may be required includes, but is not limited to: (1) the
amount of designated nondeductible contributions for the taxable year; (2) the
total amount of designated nondeductible contributions for all preceding taxable
years that have not previously been withdrawn; (3) the total balance of all your
IRAs as of the close of the calendar year with or within which the taxable year
ends; and (4) the amount of distributions from your IRAs during the taxable
year. If the required information is not shown on your return, all IRA
contributions are presumed to have been deductible. Therefore, they will be
taxable upon withdrawal from the IRA, unless it can be shown, with satisfactory
evidence, that the contributions were nondeductible when they were made.
Whenever you are liable for one of the penalty taxes discussed above (6% for
excess contributions, 10% for premature distributions, 50% for underpayments, or
15% for excess distributions), you must file Form 5329 with the Internal Revenue
Service. The form is to be attached to your income tax return (Form 1040) for
the tax year in which the penalty applies.
Financial Disclosure
The charges which may be made against a contribution to your IRA include the
Mortality and Expense Risk Charge, and other fees for the Investment Accounts
set forth in the Prospectus. The charges which may be made against a withdrawal
are also described in the Prospectus, and you should read the Prospectus
carefully and retain it for your future reference. Growth in the value of your
IRA is neither projected nor guaranteed. Capital gains in excess of net realized
short-term capital losses of a Portfolio are declared and paid annually in
additional full and fractional shares.
37
<PAGE>
Statement Of Additional Information Table Of Contents
A Statement of Additional Information is available which contains more details
concerning the subjects discussed in this Prospectus. The following is the Table
of Contents for that Statement. You may obtain a copy by calling our Annuity
Service Center at 1-800-234-5606, or by writing to us at Annuity Service Center,
H305, P.O. Box 9067, Springfield, MA 01101.
Table Of Contents
1. MORE INFORMATION ABOUT THE CONTRACT
2. RECORDS, REPORTS AND SERVICES
3. PERFORMANCE MEASURES
4. DISTRIBUTION
5. FEDERAL TAX MATTERS
6. OTHER INFORMATION
7. FINANCIAL STATEMENTS
38
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION
PANORAMA PLUS ANNUITY
OFFERED BY
C.M. LIFE INSURANCE COMPANY
140 GARDEN STREET HARTFORD, CT 06154
May 1, 1997
This Statement of Additional Information expands upon certain subjects discussed
in the current Prospectus for the Panorama Plus variable annuity contract (the
"Contract") offered by C.M. Life Insurance Company. You may obtain a copy of the
Prospectus dated May 1, 1997 by calling 1-800-234-5606, or by writing to the
Annuity Service Center, H305, P.O. Box 9067, Springfield, MA 01101. Terms used
in the current Prospectus for the Contract are incorporated in this Statement.
THIS STATEMENT OF ADDITIONAL INFORMATION IS NOT A PROSPECTUS AND SHOULD BE READ
ONLY IN CONJUNCTION WITH THE PROSPECTUSES FOR THE CONTRACT AND FOR THE
UNDERLYING PORTFOLIOS.
Dated: May 1, 1997
<TABLE>
<CAPTION>
TABLE OF CONTENTS
PAGE
<S> <C>
More Information About the Contract....................................2
Determination of Sub-Account Accumulation Unit Values .................2
Annuity Period Transfer Formulas.......................................3
Records, Reports and Services..........................................4
Performance Measures...................................................5
Distribution...........................................................7
Federal Tax Matters....................................................7
Other Information......................................................9
Financial Statements...................................................9
</TABLE>
7
<PAGE>
The following discussion provides additional information about C.M. Life and the
Contract that may be of interest to Contract Owners and supplements the
information provided in the Prospectus.
MORE INFORMATION ABOUT THE CONTRACT
DETERMINATION OF SUB-ACCOUNT ACCUMULATION UNIT VALUES
ACCUMULATION UNITS. Accumulation Units are used to account for all amounts
allocated to or withdrawn from the Separate Account.
C.M. Life will determine the number of Accumulation
Units of a Sub-Account purchased or canceled by
dividing the Net Purchase Payment allocated to (or the
amount withdrawn from) the Sub-Account by the dollar
value of one Accumulation Unit on the date of the
transaction. The Separate Account Balance will consist
of the sum of the value of all Accumulation Units in
all Sub-Accounts credited to the Contract on the
applicable Valuation Date.
ACCUMULATION UNIT VALUE. The value of an Accumulation Unit in a Sub-Account on
any Valuation Date is the product of (a) the value on
the preceding Valuation Date and (b) the Net Investment
Factor for the Sub-Account for the Valuation Period
just ended.
A VALUATION DATE is every day on which C.M. Life and the New York Stock
Exchange (NYSE) are open for business, but shall not
include any day on which trading on the NYSE is
restricted, or on which an emergency exists, as
determined by the Securities and Exchange Commission
and/or respective governing bodies of the NYSE so that
valuation or disposal of securities is not practicable.
A VALUATION PERIOD is the period of time beginning on the day following
any Valuation Date and ending on the next Valuation
Date. A Valuation Period may be one day or more than
one day.
NET INVESTMENT FACTOR C.M. Life calculates the Net Investment Factor for each
Sub-Account as follows:
(ENAV + DIV - TAX) / BNAV - CHGS = Net Investment Factor
Where:
(ENAV) ending net asset value, I.E., the net asset value per share of
the Sub-Account's investment in the appropriate Portfolio of a Fund
for the Valuation Period just ended.
(DIV) dividends, I.E., any dividend per share declared on behalf of
the Portfolio that has an ex-dividend date within the Valuation Period
just ended. This includes both income and capital gain dividends.
(TAX) taxes, I.E., the reserve for taxes per share on realized and
unrealized capital gains or losses of such Portfolio within the
Valuation Period just ended (a negative number represents a tax
credit).
(BNAV) beginning net asset value, I.E., the net asset value per share
of the Sub-Account's investment in such Portfolio of a Fund at the
beginning of the Valuation Period just ended.
8
<PAGE>
(CHGS) applicable charges, I.E., the accumulated Mortality and Expense
Risk Charge and Administrative Expense Charge for each day in the
Valuation Period just ended (which will not exceed 1.50% on an annual
basis).
EXAMPLE. The following example illustrates the calculation of
-------
Accumulation Unit Value:
Net Asset Value Per Share at End of Valuation
Period (ENAV) = $ 34.00
Dividends Per Share Declared (Ex-dividend Date within
Valuation Period) (DIV) = $ 2.00
Reserve for Taxes Per Share on Capital Gains/Losses
(within valuation Period)(TAX) = $ [5.00]
Net Asset Value Per Share at Beginning of Valuation
Period (BNAV) = $ 30.00
Applicable Mortality and Expense and Administrative
Charges for Valuation Period (CHGS) =
(.0107 + .0007)/365 = .0000312
Net Investment Factor = (34 + 2 - 5)/30 - .0000312 = 1.0333021
Accumulation Unit Value at Beginning of Period = $ 10.00
Accumulation Unit Value at End of Period =
10.00 x 1.0333021 = $ 10.33
ANNUITY PERIOD TRANSFER FORMULAS
During the Annuity Period, the Contract Owner may transfer Separate
Account Balance from one Sub-Account to another, subject to certain limitations.
No transfers are permitted to or from the General Account during the Annuity
Period. (See "Transfers," in the Prospectus.)
1. Transfers during the Annuity Period are implemented according to
the following formula:
2. Determine the number of units to be transferred from the Sub-
Account as follows: = AT/AUV1
3. Determine the number of Annuity Units remaining in such Sub-
Account (after the transfer) = UNIT1- AT/AUV
4. Determine the number of Annuity Units in the transferee Sub-
Account (after the transfer): = UNIT2 + AT/AUV2
5. Subsequent annuity payments will reflect the changes in Annuity
Units in each Sub-Account as of the next Annuity Income payment's
due date.
Where:
(AUV1) is the Annuity Unit Value of the Sub-Account that
the transfer is being made from as of the next
annuity payment's due date.
(AUV2) is the Annuity Unit Value of the Sub-Account that
the transfer is being made to as of the next
annuity payment's due date.
(UNIT1) is the number of units in the Sub-Account that the
transfer is being made from, before the transfer.
9
<PAGE>
(UNIT2) is the number of units in the Sub-Account that the
transfer is being made to, before the transfer.
(AT) is the dollar amount being transferred from the
Sub-Account.
EXAMPLE. The following example illustrates the application of
-------
the Annuity Period transfer formulas:
ASSUME
------
Annuity Unit Value of Sub-Account #1 = $10.00
Annuity Unit Value of Sub-Account #2 = $ 8.50
Number of Units in Sub-Account #1 = 50
Number of Units in Sub-Account #2 = 20
To Transfer $30.00 From Sub-Account #1 to Sub-Account #2:
Number of Units to Transfer from Sub-Account #1 = 30/10 = 3
Number of Units Left after Transfer = 50 - 3 = 47
Number of Units to Transfer to Sub-Account #2 = 30/8.50 = 3.53
New Number of Units in Sub-Account #2 = 20 + 3.53 = 23.53
New Monthly Annuity Income Payment From Sub-Account #1=
10 x 47 = $470.00
New Monthly Annuity Income Payment From Sub-Account #2=
23.53 x 8.50 = $200.01
RECORDS, REPORTS AND SERVICES
All records and accounts relating to the Separate Account will be
maintained by C.M. Life. As presently required by the Investment Company Act of
1940 and regulations promulgated thereunder, C.M. Life will mail to all Contract
Owners at their last known address of record, at least annually, reports
containing such information as may be required under that Act or by any other
applicable law or regulation. Contract Owners will also receive confirmation of
each financial transaction and any other reports required by law or regulation.
The assets of each of the Sub-Accounts of the Separate Account are held in
the custody of C.M. Life. The assets of each of the Sub-Accounts of the Separate
Account are segregated and held separate and apart from the assets of the other
Sub-Accounts and from C.M. Life's general account assets. C.M. Life maintains
records of all purchases and redemptions of shares of the Portfolios of the Fund
held by each of the Sub-Accounts.
10
<PAGE>
PERFORMANCE MEASURES
C.M. Life may show the performance for the Sub Accounts of the Separate Account
in the following ways:
Standardized Average Annual Total Return
----------------------------------------
C.M. Life will show the "Standardized Average Annual Total Return," formulated
as prescribed by the rules of the SEC, for each Sub-Account. The Standardized
Average Annual Total Return is the effective annual compounded rate of return
that would have produced the cash redemption value over the stated period had
the performance remained constant throughout. The calculation assumes a single
$1,000 payment made at the beginning of the period and full redemption at the
end of the period. It reflects a deduction for the contingent deferred sales
charge, the Annual Contract Maintenance Fee and all other Fund, Separate Account
and Contract level charges except premium taxes, if any. The Annual Contract
Maintenance Fee is apportioned among the Sub-Accounts based upon the percentages
of in force Contracts investing in each of the Sub-Accounts. The Company may
choose to show Standardized Average Annual Total Returns based on the inception
of the underlying Fund.
The following tables show the Standardized Average Annual Total Return for the
Sub-Accounts for the period ended December 31, 1996.
<TABLE>
<CAPTION>
1 Year Since Inception*
------ ----------------
<S> <C> <C>
Growth Portfolio 11.60% 14.39%
Total Return Portfolio 2.60% 8.27%
Oppenheimer Bond Portfolio -1.26% 5.56%
Government Securities Portfolio -3.73% 4.54%
Oppenheimer Money Portfolio -0.81% 2.16%
International Portfolio 6.37% 5.99%
</TABLE>
*Inception of the contract was May 13, 1992.
Additional Performance Measures
-------------------------------
The performance figures discussed below, are calculated on the basis of the
historical performance of the Funds, and may assume the Contracts were in
existence prior to May 13, 1992 (which they were not). Beginning May 13, 1992
(inception date), actual Accumulation Unit values are used for the calculations.
The difference between the first set, ANNUALIZED RETURNS on Accumulation Unit
Values, and the second set, the NON-STANDARDIZED ANNUAL and AVERAGE ANNUAL TOTAL
RETURNS, is that the second set includes the deduction of the Annual Contract
Maintenance Fee, whereas the first set does not.
Additional details follow.
Accumulation Unit Values: Annualized Returns.
--------------------------------------------
C.M. Life will show the ANNUALIZED RETURN, or average annual change in
Accumulation Unit values, with respect to one or more periods. For one year, the
Annualized Return is the effective annual rate of return. For periods greater
than one year, the Annualized Return is the effective annual compounded rate of
return for the periods stated. Since the value of an Accumulation Unit reflects
the Separate Account and Fund expenses (See Table of Fees and Expenses in the
Prospectus), the Percentage Change and Annualized Returns also reflect these
expenses. However, these percentages do not reflect the Annual Contract
Maintenance Fee and the sales charge or premium taxes (if any), which if
included would reduce the percentages reported by C.M. Life.
11
<PAGE>
Annualized Accumulation Unit Value Return
-----------------------------------------
For Periods Ending 12/31/96
---------------------------
<TABLE>
<CAPTION>
Portfolio (Inception) 1 Year 3 Years 5 Years 10 Years
- --------------------- ------ ------- ------- --------
<S> <C> <C> <C> <C>
Growth Portfolio (1/21/82) 17.73% 16.43% 16.01% 14.63%
Total Return Portfolio (9/30/82) 8.63% 9.23% 10.26% 11.05%
Oppenheimer Bond Portfolio (4/3/85) 3.61% 5.13% 6.46% 7.58%
Government Securities Portfolio (5/12/92) 0.92% 3.74% N/A N/A
Oppenheimer Money Portfolio (4/3/85)* 3.95% 3.82% 3.24% N/A
International Portfolio (5/13/92) 11.89% 6.92% N/A N/A
</TABLE>
*Although the Oppenheimer Money Fund commenced operations on 4/3/85, the
information necessary to calculate returns is available only for 1987 and later
years.
The NON-STANDARDIZED ANNUAL TOTAL RETURN for a Sub-Account is the effective
annual rate of return that would have produced the ending Accumulated Value of
the stated one-year period.
The NON-STANDARDIZED AVERAGE ANNUAL TOTAL RETURN for a Sub-Account is the
effective annual compounded rate of return that would have produced the ending
Accumulated Value over the stated period had the performance remained constant
throughout.
Note: The NON-STANDARDIZED ANNUAL TOTAL RETURN will be less than the
NON-STANDARDIZED ANNUALIZED RETURN on Accumulation Unit values for the same
period due to the effect of the Annual Contract Maintenance Fee. Additionally,
the magnitude of this difference will depend on the size of the Accumulated
Value from which the annual Administrative Charge is deducted.
The performance figures discussed above reflect historical results of the Funds
and are not intended to indicate or to predict future performance.
Performance information for the Sub-Accounts may be: (a) compared to other
variable annuity separate accounts or other investment products surveyed by
Lipper Analytical Services, a nationally recognized independent reporting
service or similar services that rank mutual funds and other investment
companies by overall performance, investment objectives and assets; (b) tracked
by other ratings services, companies, publications or persons who rank separate
accounts or other investment products on overall performance or other criteria;
and (c) included in data bases that can be used to produce reports and
illustrations by organizations such as CDA Wiesenberger. Performance figures
will be calculated in accordance with standardized methods established by each
reporting service.
YIELD AND EFFECTIVE YIELD
C.M. Life may show yield and effective yield figures for the Money Market
Sub-Account. "Yield" refers to the income generated by an investment in the
Money Market Sub-Account over a seven-day period, which is then "annualized."
That is, the amount of income generated by the investment during that week is
assumed to be generated each week over a 52-week period and is shown as a
percentage of the investment. The "effective" yield is calculated similarly but,
when annualized, the income earned by an investment in the Money Market
Sub-Account is assumed to be re-invested. Therefore the effective yield will be
slightly higher than the yield because of the compounding effect of this assumed
reinvestment.
These figures reflect a deduction for all Fund, Separate Account, and Contract
level charges, assuming the Contract remains in force. The figures do not
reflect the $30 Annual Contract Maintenance Fee, the contingent deferred sales
charge or premium tax deductions (if any), which if included would reduce the
percentages reported.
12
<PAGE>
The 7-day Yield and Effective Yield for the Money Market Sub-Accounts for the
periods ended December 31, 1996 are as follows:
Before Annual Contract Maintenance Charge Deduction
7-Day Yield: 3.23%
7-Day Effective Yield: 3.28%
Annual Contract Maintenance Charge Deduction is 0.086%
After Annual Contract Maintenance Charge Deduction:
7-Day Yield: 3.15%
7-Day Effective Yield: 3.20%
The performance figures discussed above reflect historical results of the Funds
and are not intended to indicate or to predict future performance.
DISTRIBUTION
MML Distributors, LLC ("MML Distributors"), formerly known as Connecticut Mutual
Financial Services, LLC, is the distributor of the Contracts. MML Distributors
is a limited liability corporation. On March 1, 1996, MML Investors Services,
Inc. ("MMLISI") began serving as co-underwriter of the Contracts. Both MML
Distributors and MMLISI are broker-dealers registered with the Securities and
Exchange Commission and members of the National Association of Securities
dealers, Inc. MML Distributors and MMLISI are indirect wholly owned subsidiaries
of Massachusetts Mutual Life Insurance Company and affiliates of C.M. Life
Insurance Company.
Pursuant to the Underwriting and Servicing Agreement, both MML Distributors and
MMLISI will receive compensation for their activities as underwriters for the
Separate Account. Compensation paid to MMLISI in 1996 was $89,260. No
compensation was paid to MML Distributors in 1996. Commissions will be paid
through MMLISI and MML Distributors to agents and selling brokers for selling
the Contracts. During 1996, commission payments amounted to $4,655,336.
MML Distributors may enter into selling agreements with other broker-dealers
which are registered with the Securities and Exchange Commission and are members
of the National association of Securities Dealers, Inc. ("selling brokers").
Contracts are sold through agents who are licensed by state insurance officials
to sell the Contracts. These agents are also registered representatives of
selling brokers or of MMLISI. MML Distributors does business under different
variations of its name; including the name MML Distributors, L.L.C. in the
states of Illinois, Michigan, Oklahoma, South Dakota, and Washington, and the
MML Distributors, Limited Liability Company in the states of Maine, Ohio, and
West Virginia. The offering is on a continuous bases.
FEDERAL TAX MATTERS
The Panorama Plus Annuity is designed for use by individuals in retirement plans
which may or may not be plans qualified for special tax treatment under Sections
401, 403, 408 or 457 of the Internal Revenue Code of 1986, as amended (the
"Code"). The ultimate effect of federal income taxes on the Contract Balance, on
Annuity Income payments, and on the economic benefit to the Contract Owner, the
Annuitant or the Beneficiary depends on the type of retirement plan for which
the contract is purchased, on the tax and employment status of the individual
concerned and on C.M. Life's tax status. THE FOLLOWING DISCUSSION IS GENERAL AND
IS NOT INTENDED AS TAX ADVICE. Any person concerned about these tax implications
should consult a competent tax adviser. This discussion is based upon C.M.
Life's understanding of the present federal income tax laws as they are
currently interpreted by the Internal Revenue Service. No representation is made
as to the likelihood of continuation of these present federal income tax laws or
of the current interpretations by the Internal Revenue Service. Moreover, no
attempt has been made to consider any applicable state or other tax laws.
13
<PAGE>
TAXATION OF C.M. LIFE
C.M. Life is taxed as a life insurance company under Part I of Subchapter L of
the Code. The following discussion assumes that C.M. Life is taxed as a life
insurance company under Part I of Subchapter L. Since the Separate Account is
not an entity separate from C.M. Life, and its operations form a part of C.M.
Life, it will not be taxed separately as a "regulated investment company" under
Subchapter M of the Code. Investment income and realized capital gains are
automatically applied to increase reserves under the Contract. Under existing
federal income tax law, C.M. Life believes that the Separate Account investment
income and realized net capital gains will not be taxed to the extent that such
income and gains are applied to increase the reserves under the contract.
Accordingly, C.M. Life does not anticipate that it will incur any federal income
tax liability attributable to the Separate Account and, therefore, C.M. Life
does not intend to make provisions for any such taxes. However, if changes in
the federal tax laws or interpretations thereof result in C.M. Life being taxed
on income or gains attributable to the Separate Account, then C.M. Life may
impose a charge against the Separate Account (with respect to some or all
contracts) in order to set aside provisions to pay such taxes.
TAX STATUS OF THE CONTRACTS
Section 817(h) of the Code requires that with respect to Non-Qualified
Contracts, the investments of the Portfolios of the Fund be "adequately
diversified" in accordance with U.S. Treasury regulations in order for the
Contracts to qualify as annuity contracts under federal tax law. The Separate
Account, through the Fund, intends to comply with the diversification
requirements prescribed by the U.S. Treasury in Reg. sec. 1.817-5, which affect
how the assets of the Fund may be invested.
In certain circumstances, owners of variable annuity contracts may be considered
the owners, for federal income tax purposes, of the assets of the separate
accounts used to support their contracts. In those circumstances, income and
gains from the separate account assets would be includible in the variable
contract owner's gross income. The IRS has stated in published rulings that a
variable contract owner will be considered the owner of separate account assets
if the contract owner possesses incidents of ownership in those assets, such as
the ability to exercise investment control over the assets. The Treasury
Department has also announced, in connection with the issuance of regulations
concerning diversification, that those regulations "do not provide guidance
concerning the circumstances in which investor control for the investments of a
segregated asset account may cause the investor [I.E., the Contract Owner],
rather than the insurance company, to be treated as the owner of the assets in
the account." This announcement also stated that guidance would be issued by way
of regulations or rulings on the "extent to which policyholders may direct their
investments to particular Sub-Accounts without being treated as owners of the
underlying assets."
The ownership rights under the Contract are similar to, but also different in
certain respects from, those described by the IRS in rulings in which it was
determined that contract owners were not owners of separate account assets. For
example, a Contract Owner has additional flexibility in allocating premium
payments and account values. These differences could result in a Contract Owner
being treated as the owner of a pro rata portion of the assets of the Variable
Account. In addition, C.M. Life does not know what standards will be set forth,
if any, in the regulations or rulings which the Treasury Department has stated
it expects to issue. C.M. Life therefore reserves the right to modify the
Contract as necessary to attempt to prevent a Contract Owner from being
considered the owner of a pro rata share of the assets of the Separate
Account.
In order to be treated as an annuity contract for federal income tax purposes,
section 72(s) of the Code requires any Non-qualified Contract to provide that
(a) if any Contract Owner dies on or after the Annuity Income Date but prior to
the time the entire interest in the Contract has been distributed, the remaining
portion of such interest will be distributed at least as rapidly as under the
method of distribution being used as of the date of that Contract Owner's death;
and (b) if any Contract Owner dies prior to the Annuity Income Date, the entire
interest in the Contract will be distributed within five years after the date of
the Contract Owner's death. These requirements will be considered satisfied as
to any portion of the Contract Owner's interest which is payable to or for the
benefit of a
14
<PAGE>
"designated beneficiary" and which is distributed over the life of such
"designated beneficiary" or over a period not extending beyond the life
expectancy of that beneficiary, provided that such distributions begin within
one year of that owner's death. The Contract Owner's "designated beneficiary" is
the person designated by such Contract Owner as a beneficiary and to whom
ownership of the Contract passes by reason of death and must be a natural
person. However, if the Contract Owner's "designated beneficiary" is the
surviving spouse of the Contract Owner, the Contract may be continued with the
surviving spouse as the new owner.
The Non-qualified Contracts contain provisions which are intended to comply with
the requirements of section 72(s) of the Code, although no regulations
interpreting these requirements have yet been issued. The Company intends to
review such provisions and modify them if necessary to assure that they comply
with the requirements of Code section 72(s) when clarified by regulation or
otherwise. Other rules may apply to Qualified Contracts.
OTHER INFORMATION
Registration Statements have been filed with the Securities and Exchange
Commission, under the Securities Act of 1933, as amended, with respect to the
Contracts discussed in this Statement of Additional Information. Not all of the
information set forth in the Registration Statements, amendments and exhibits
thereto has been included in the Prospectus for the Contracts or this Statement
of Additional Information. Statements contained in the Prospectus and this
Statement of Additional Information concerning the content of the Contracts and
other legal instruments are intended to be summaries. For a complete statement
of the terms of these documents, reference should be made to the instruments
filed with the Securities and Exchange Commission.
FINANCIAL STATEMENTS
The audited financial statements of Panorama Plus Separate Account as of
December 31, 1996 and for the year then ended included in this Statement of
Additional Information have been so included in reliance on the report of
Coopers & Lybrand L.L.P., independent accountants, given on the authority of
that firm as experts in accounting and auditing.
The audited financial statements of Panorama Plus Separate Account for the year
ended December 31, 1995 included in this Statement of Additional Information
have been so included in reliance on the report of Arthur Andersen LLP,
independent accountants, given on the authority of that firm as experts in
accounting and auditing.
The audited statement of statutory financial position of C.M. Life Insurance
Company as of December 31, 1996 and the related statutory statements of income,
changes in shareholder's equity and cash flows for the year ended December 31,
1996 included in this Statement of Additional Information have been so included
in reliance on the report, which includes explanatory paragraphs relating to the
use of statutory accounting practices rather than generally accepted accounting
principles, of Coopers & Lybrand L.L.P., independent accountants, given on the
authority of that firm as experts in accounting and auditing.
The audited statement of statutory financial position of C.M. Life Insurance
Company as of December 31, 1995 and the related statutory statements of income,
changes in shareholder's equity and cash flows for each of the years in the two
year period ended December 31, 1995 included in this Statement of Additional
Information have been so included in reliance on the reports of Arthur Andersen
LLP, C.M. Life's former independent accountants, given on the authority of that
firm as experts in accounting and auditing.
15
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Contract Owners of Panorama Plus Separate Account
and the Board of Directors of C. M. life Insurance Company
We have audited the statement of assets and liabilities of Panorama Plus
Separate Account as of December 31, 1996, and the related statements of
operations and changes in net assets for the year then ended. These financial
statements are the responsibility of the Account's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. Our procedures included
confirmation of securities owned as of December 31, 1996, by correspondence with
the underlying investment fund. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Panorama Plus Separate
Account as of December 31, 1996, and the results of its operations and changes
in its net assets for the year then ended, in conformity with generally accepted
accounting principles.
Coopers & Lybrand L.L.P.
Springfield, Massachusetts
March 14, 1997
1
<PAGE>
To Panorama Plus Separate Account of C.M. Life Insurance Company
and to the Owners of Units of Interest Therein:
We have audited the accompanying statement of changes in net assets of Panorama
Plus Separate Account of C.M. Life Insurance for the period ended December 31,
1995. This financial statement is the responsibility of the Account's
management. Our responsibility is to express an opinion on this financial
statement based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statement referred to above presents fairly, in
all material respects, the changes in net assets of Panorama Plus Separate
Account of C.M. Life Insurance Company for the period ended December 31, 1995,
in conformity with generally accepted accounting principles.
ARTHUR ANDERSEN LLP
Hartford, Connecticut
February 15, 1996
16
<PAGE>
Panorama Plus Separate Account
STATEMENT OF ASSETS AND LIABILITIES
December 31, 1996
<TABLE>
<CAPTION>
<S> <C>
ASSETS:
Investments, at market (Notes 3A and 3B):
Panorama Series Fund, Inc.
Total Return
186,652,014 shares (Cost $316,601,071)................................................................ $ 356,505,477
Growth
75,574,725 shares (Cost $181,675,806)................................................................. 225,212,785
Government Securities
15,013,805 shares (Cost $15,534,182).................................................................. 16,365,045
International Equity
43,985,024 shares (Cost $50,746,672).................................................................. 56,740,656
--------------
654,823,963
--------------
Oppenheimer Variable Account Funds
Money
15,449,202 shares (Cost $15,449,202).................................................................. 15,449,202
Bond
2,515,122 shares (Cost $29,985,806)................................................................... 29,250,853
--------------
44,700,055
--------------
Cash........................................................................................................ 566,635
Dividends receivable........................................................................................ 18,797
--------------
Total assets............................................................................................ 700,109,450
--------------
LIABILITIES:
Due to C.M. Life Insurance Company.......................................................................... 327,521
--------------
NET ASSETS.................................................................................................. $ 699,781,929
==============
<CAPTION>
Units Unit value Net assets
----- ---------- ----------
<S> <C> <C> <C>
Net assets consisted of:
Total Return................................................................. 224,734,224 $ 1.586635 $ 356,571,185
Growth....................................................................... 111,846,534 2.014864 225,355,557
Governmental Securities...................................................... 12,647,811 1.293638 16,361,689
International Equity......................................................... 40,507,658 1.400836 56,744,585
Money........................................................................ 13,507,122 1.147312 15,496,883
Bond......................................................................... 22,192,539 1.318102 29,252,030
--------------
$ 699,781,929
==============
</TABLE>
See Notes to Financial Statements.
2
<PAGE>
Panorama Plus Separate Account
STATEMENT OF OPERATIONS
For the Year Ended December 31, 1996
<TABLE>
<CAPTION>
Sub-Accounts
-------------------------------------------------------------------------------------------------------------
Government International
Total Return Growth Securities Equity Money Market Income
------------ ------ ---------- ------ ---------------------------- --------------------------
Panorama Panorama
Panorama Panorama Government International Panorama Oppenheimer Panorama Oppenheimer
Total Return Growth Securities Equity Money Market/(1)/ Money/(2)/ Income/(3)/ Bond/(4)/
------------ ------ ---------- ------ --------------- ----------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Investment income
Dividends (Note 3B)... $ 2,822,751 $ 1,628,958 $ 10,053 $ 466,653 $ 825,442 $ 62,650 $ 3,959,705 $ 474,420
Expenses
Mortality and expense
risk fees (Note 4)... 3,702,772 2,112,794 197,732 556,918 180,129 15,158 298,776 29,426
----------- ----------- ---------- ----------- ----------- ---------- ----------- ----------
Net investment income
(loss)(Note 3C)...... (880,021) (483,836) (187,679) (90,265) 645,313 47,492 3,660,929 444,994
----------- ----------- ---------- ----------- ----------- ---------- ----------- ----------
Net realized and
unrealized gain (loss)
on investments
Net realized gain (loss)
on investments (Notes
3B, 3C and 5)........ 912,928 3,473,349 (118,069) 449,754 -- -- (3,362,435) 73,809
Change in net unrealized
appreciation/depreciation
of investments....... 27,563,072 28,025,240 429,597 5,038,678 -- -- 218,297 (734,953)
----------- ----------- ---------- ----------- ----------- ---------- ----------- ----------
Net gain (loss) on
investments.......... 28,476,000 31,498,589 311,528 5,488,432 -- -- (3,144,138) (661,144)
----------- ----------- ---------- ----------- ----------- ---------- ----------- ----------
Net increase (decrease)
in net assets resulting
from operations...... $27,595,979 $31,014,753 $ 123,849 $ 5,398,167 $ 645,313 $ 47,492 $ 516,791 $ (216,150)
=========== =========== ========== =========== =========== ========== =========== ==========
</TABLE>
/(1)/ For the period 1/1/96-12/1/96, the Money Market Sub-Account invested in
shares of the Panorama Series Money Market Portfolio which has since been
liquidated.
/(2)/ For the period 12/2/96-12/31/96, the Money Market Sub-Account invested in
shares of the Oppenheimer Money Fund.
/(3)/ For the period 1/1/96-12/1/96, the Income Sub-Account invested in shares
of the Panorama Series Income Portfolio which has since been liquidated.
/(4)/ For the period 12/2/96-12/31/96, the Income Sub-Account invested in shares
of the Oppenheimer Bond Fund.
See Notes to Financial Statements.
3
<PAGE>
Panorama Plus Separate Account
STATEMENT OF CHANGES IN NET ASSETS
For the Year Ended December 31, 1996
<TABLE>
<CAPTION>
Sub-Accounts
-----------------------------------------------------------------
Government International
Total Return Growth Securities Equity
----- ------ ------ ---------- ------
Panorama Panorama
Panorama Panorama Government International
Total Return Growth Securities Equity
------------ ------ ---------- ------
<S> <C> <C> <C> <C>
Increase (decrease) in net assets
Operations:
Net investment income (loss).............................. $ (880,021) $ (483,836) $ (187,679) $ (90,265)
Net realized gain (loss)
on investments.......................................... 912,928 3,473,349 (118,069) 449,754
Change in net unrealized
appreciation/depreciation
of investments.......................................... 27,563,072 28,025,240 429,597 5,038,678
------------ ------------ ----------- -----------
Net increase (decrease) in net assets
resulting from operations............................... 27,595,979 31,014,753 123,849 5,398,167
------------ ------------ ----------- -----------
Capital transactions:
Net contract payments..................................... 58,289,165 43,547,484 2,353,505 9,650,871
Withdrawal of funds....................................... (15,286,758) (6,911,580) (1,493,004) (2,171,308)
Transfers between sub-accounts and
C.M. Life Insurance Company............................. 1,625,115 15,025,257 (2,216,775) 4,652,684
------------ ------------ ----------- -----------
Net increase (decrease) in net assets
resulting from capital transactions..................... 44,627,522 51,661,161 (1,356,274) 12,132,247
------------ ------------ ----------- -----------
Total increase (decrease)................................... 72,223,501 82,675,914 (1,232,425) 17,530,414
NET ASSETS, at beginning of the year........................ 284,347,684 142,679,643 17,594,114 39,214,171
------------ ------------ ----------- -----------
NET ASSETS, at end of the year.............................. $356,571,185 $225,355,557 $16,361,689 $56,744,585
============ ============ =========== ===========
<CAPTION>
Sub-Accounts
----------------------------------------------------------------
Money Market Income
----------------------------- --------------------------
Panorama Oppenheimer Panorama Oppenheimer
Money Market/(1)/ Money/(2)/ Income/(3)/ Bond/(4)/
----------------- ---------- ----------- ---------
<S> <C> <C> <C> <C>
Increase (decrease) in net assets
Operations:
Net investment income (loss).............................. $ 645,313 $ 47,492 $ 3,660,929 $ 444,994
Net realized gain (loss)
on investments.......................................... -- -- (3,362,435) 73,809
Change in net unrealized
appreciation/depreciation
of investments.......................................... -- -- 218,297 (734,953)
------------ ----------- ------------ -----------
Net increase (decrease) in net assets
resulting from operations............................... 645,313 47,492 516,791 (216,150)
------------ ----------- ------------ -----------
Capital transactions:
Net contract payments..................................... 10,034,439 412,644 6,566,750 219,153
Withdrawal of funds....................................... (981,045) (64,032) (1,443,217) (360,211)
Transfers between sub-accounts and
C.M. Life Insurance Company............................. (28,353,311) 15,100,779 (32,577,949) 29,609,238
------------ ----------- ------------ -----------
Net increase (decrease) in net assets
resulting from capital transactions..................... (19,299,917) 15,449,391 (27,454,416) 29,468,180
------------ ----------- ------------ -----------
Total increase (decrease)................................... (18,654,604) 15,496,883 (26,937,625) 29,252,030
NET ASSETS, at beginning of the year........................ 18,654,604 -- 26,937,625 --
------------ ----------- ------------ -----------
NET ASSETS, at end of the year.............................. $ -- $15,496,883 $ -- $29,252,030
============ =========== ============ ===========
</TABLE>
/(1)/ For the period 1/1/96-12/1/96, the Money Market Sub-Account invested in
shares of the Panorama Series Money Market Portfolio which has since been
liquidated.
/(2)/ For the period 12/2/96-12/31/96, the Money Market Sub-Account invested in
shares of the Oppenheimer Money Fund.
/(3)/ For the period 1/1/96-12/1/96, the income Sub-Account invested in shares
of the Panorama Series Income Portfolio which has since been liquidated.
/(4)/ For the period 12/2/96-12/31/96, the Income Sub-Account invested in shares
of the Oppenheimer Bond Fund.
See Notes to Financial Statements.
4
<PAGE>
Panorama Plus Separate Account
STATEMENT OF CHANGES IN NET ASSETS
For the Year Ended December 31, 1995
<TABLE>
<CAPTION>
Sub-Accounts
---------------------------------------------------------------------------------------
Total Government International Money
Return Growth Securities Equity Market Income
------ ------ ---------- ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
Increase (decrease) in net assets
Operations:
Net investment income.................... $ 17,370,357 $ 8,743,089 $ 748,504 $ 1,316,503 $ 678,166 $ 1,416,946
Net realized gain (loss)
on investments......................... 412,341 1,077,287 (181,580) 80,004 -- (560,230)
Change in net unrealized
appreciation of investments............ 28,716,298 19,468,392 1,740,443 1,659,806 -- 2,626,301
------------ ------------ ------------ ------------ ----------- ------------
Net increase in net assets
resulting from operations.............. 46,498,996 29,288,768 2,307,367 3,056,313 678,166 3,483,017
------------ ------------ ------------ ------------ ----------- ------------
Capital transactions:
Net contract payments.................... 65,816,257 47,296,147 4,239,135 12,435,120 16,303,708 7,327,312
Withdrawal of funds...................... (9,098,100) (4,558,600) (1,010,025) (1,236,355) (1,041,002) (1,503,125)
Transfers between sub-accounts and
C.M. Life Insurance Company............ 6,375,872 8,203,928 (1,082,071) (711,707) (11,631,631) (750,762)
------------ ------------ ------------ ------------ ----------- ------------
Net increase in net assets resulting
from capital transactions.............. 63,094,029 50,941,475 2,147,039 10,487,058 3,631,075 5,073,425
------------ ------------ ------------ ------------ ----------- ------------
Total increase............................. 109,593,025 80,230,243 4,454,406 13,543,371 4,309,241 8,556,442
NET ASSETS, at beginning of the year....... 174,754,659 62,449,400 13,139,708 25,670,800 14,345,363 18,381,183
------------ ------------ ------------ ------------ ----------- ------------
NET ASSETS, at end of the year............. $284,347,684 $142,679,643 $ 17,594,114 $ 39,214,171 $ 18,654,604 $ 26,937,625
============ ============ ============ ============ =========== ============
</TABLE>
See Notes to Financial Statements.
5
<PAGE>
Panorama Plus Separate Account
Notes To Financial Statements
1. HISTORY
Panorama Plus Separate Account (the "Separate Account") was established as a
separate investment account of C.M. Life Insurance Company ("C.M. Life").
C.M. Life was formerly a wholly-owned stock life insurance subsidiary of
Connecticut Mutual Life Insurance Company ("CML"). On February 29, 1996, CML
merged with and into Massachusetts Mutual Life Insurance Company ("Mass
Mutual"). Upon the merger, CML's existence ceased and MassMutual became the
surviving company under the name Massachusetts Mutual Life Insurance Company.
C.M. Life became a wholly-owned subsidiary of MassMutual. The Separate
Account operates as a registered unit investment trust pursuant to the
Investment Company Act of 1940 ("the 1940 Act") and the rules promulgated
thereunder.
2. INVESTMENT OF THE SEPARATE ACCOUNT'S ASSETS
The Separate Account maintains six Sub-Accounts. Each Sub-Account invests in
shares of certain investment portfolios of two investment companies: the
Panorama Series Fund, Inc. ("Panorama Series") (prior to May 1, 1996 named
Connecticut Mutual Financial Services Series Fund I, Inc.) and the
Oppenheimer Variable Account Funds. Panorama Series is a series-type mutual
fund with four of its portfolios currently available to Panorama Plus
contract owners: Total Return, Growth, Government Securities and
International Equity. Oppenheimer Variable Account Funds is a series-type
mutual fund with two of its portfolios currently available to Panorama Plus
contract owners: Oppenheimer Money and Oppenheimer Bond. Oppenheimer Funds,
Inc., a controlled subsidiary of MassMutual, serves as investment adviser to
the Panorama Series and Oppenheimer Variable Account Funds. The Panorama
Series and Oppenheimer Variable Account Funds are registered, open-end,
diversified management investment companies registered under the 1940 Act.
In addition to the six Sub-Accounts of the Separate Account, a contract owner
may allocate funds to C.M. Life's General Account. Interests in the General
Account are registered under the Securities Act of 1933, as amended, but the
General Account is not registered under the 1940 Act.
3. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed
consistently by the Separate Account in preparation of the financial
statements in conformity with generally accepted accounting principles.
A. Investment Valuation
The investments in Panorama Series and Oppenheimer Variable Account Funds are
each stated as market value which is the net asset value per share of each of
the respective underlying portfolios.
B. Accounting for Investments
Investment transactions are accounted for on the trade date and identified
cost is the basis followed in determining the cost of investments sold for
financial statement purposes. Dividend income is recorded on the ex-dividend
date.
C. Federal Income Taxes
Operations of the Separate Account form a part of the total operations of
C.M. Life, and the Separate Account is not taxed separately. C.M. Life is
taxed as a life insurance company under the provisions of the 1986 Internal
Revenue Code, as amended. The Separate Account will not be taxed as a
"regulated investment company" under Subchapter M of the Internal Revenue
Code. Under existing federal law, no taxes are payable on investment income
and realized capital gains attributable to contracts which depend on the
Separate Account's investment performance. Accordingly, no provision for
federal income tax has been made. C.M. Life may, however, make such a charge
in the future if an unanticipated change of current law results in a company
tax liability attributable to the Separate Account.
D. Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires that management make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
6
<PAGE>
Notes To Financial Statements (Continued)
4. CHARGES
There are no deductions for sales charges made from contract payments at the
time of purchase. C.M. Life may pay premium taxes in connection with
purchase payments under the Contracts. Depending upon applicable state law,
C.M. Life will deduct any premium taxes from purchase payments, upon
surrender or on the Annuity Income Date. Premium taxes currently range from
0% to 4.28% of purchase payments.
There is also an annual contract maintenance fee (currently $30 per
Contract), imposed each year for contract maintenance and related
administrative expenses.
For assuming mortality and expense risks, C.M. Life deducts a charge equal,
on an annual basis, to 1.07% of the daily net assets value of the Separate
Account's assets. C.M. Life also deducts an administrative charge equal, on
an annual basis, to .07% of the daily net assets of each of the Sub-Accounts
of the Separate Account. These charges cover expenses in connection with the
administration of the Separate Account and the contracts.
5. PURCHASES AND SALES OF INVESTMENTS
<TABLE>
<CAPTION>
Cost of Proceeds
For the Year Ended December 31, 1996 Purchases from Sales
------------------------------------ ----------- -----------
<S> <C> <C>
Panorama Total Return ................................................. $81,858,104 $38,021,391
Panorama Growth ....................................................... 69,951,514 18,551,110
Panorama Government Securities ........................................ 3,420,928 4,938,382
Panorama International Equity ......................................... 17,707,585 5,617,417
Panorama Money ........................................................ 17,332,153 35,968,475
Oppenheimer Money ..................................................... 17,814,228 2,365,026
Panorama Income ....................................................... 12,366,007 35,722,508
Oppenheimer Bond ...................................................... 30,634,670 722,673
</TABLE>
6. DISTRIBUTION AGREEMENTS
MML Distributors, LLC ("MML Distributors"), a wholly-owned subsidiary of
MassMutual, serves as principal underwriter of the contracts pursuant to an
underwriting and servicing agreement among MML Distributors, C.M. Life and
Panorama Plus Separate Account (prior to May 1, 1996, MML Distributors was
known as Connecticut Mutual Financial Services, LLC). MML Distributors is
registered with the Securities and Exchange Commission (the "SEC") as a
broker-dealer under the Securities Exchange Act of 1934 and is a member of
the National Association of Securities Dealers, Inc. (the "NASD"). MML
Distributors may enter into selling agreements with other broker-dealers who
are registered with the SEC and are members of the NASD in order to sell the
contracts.
Effective March 1, 1996, MML Investors Services, Inc. ("MMLISI") serves as
co-underwriter of the contracts pursuant to underwriting and servicing
agreements among MMLISI, C.M. Life and Panorama Plus Separate Account.
MMLISI is registered with the SEC as a broker dealer under the Securities
Exchange Act of 1934 and is a member of the NASD. Registered representatives
of MMLISI sell the contracts as authorized variable life insurance agents
under applicable state insurance laws.
Pursuant to underwriting and servicing agreements, commissions or other fees
due to registered representatives for selling and servicing the contracts
are paid by C.M. Life through MML Distributors or MMLISI. MML Distributors
and MMLISI also receive compensation for their actions as underwriters of
the contracts.
7
<PAGE>
C.M. LIFE INSURANCE COMPANY
STATUTORY FINANCIAL STATEMENTS
as of December 31, 1996 and 1995
and for the years ended December 31, 1996, 1995 and 1994
1
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Policyholders of
C.M. Life Insurance Company
We have audited the accompanying statutory statement of financial position of
C.M. Life Insurance Company as of December 31, 1996, and the related statutory
statements of income, changes in shareholder's equity, and cash flows for the
year then ended. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
As described in Note 1 to the financial statements, the Company prepared these
financial statements using statutory accounting practices of the National
Association of Insurance Commissioners and the accounting practices prescribed
or permitted by the Department of Insurance of the State of Connecticut, which
practices differ from generally accepted accounting principles. The effects on
the financial statements of the variances between the statutory basis of
accounting and generally accepted accounting principles, although not
determinable at this time, are presumed to be material.
In our opinion, because of the effects of the matter discussed in the third
paragraph, the financial statements referred to above do not present fairly, in
conformity with generally accepted accounting principles, the financial position
of C.M. Life Insurance Company at December 31, 1996, and the results of its
operations and its cash flows for the year then ended.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of C.M. Life Insurance Company at
December 31, 1996, and the results of its operations and its cash flows for the
year then ended, on the statutory basis of accounting described in Note 1.
COOPERS & LYBRAND, L.L.P.
Springfield, Massachusetts
February 7, 1997
2
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To C.M. Life Insurance Company:
We have audited the accompanying statutory statement of financial position of
C.M. Life Insurance Company (a Connecticut corporation and a wholly-owned
subsidiary of Connecticut Mutual Life Insurance Company) as of December 31,
1995, and the related statutory statements of income, changes in shareholder's
equity and cash flows for each of the two years in the period ended December 31,
1995. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe our audits provide a reasonable basis for our opinion.
In our originally issued report dated February 15, 1996, we expressed an opinion
that the 1995 financial statements, prepared using accounting practices
prescribed or permitted by the Insurance Department of the State of Connecticut,
present fairly, in all material respects, the financial position of C.M. Life
Insurance Company as of December 31, 1995, and the results of its operations,
and its cash flows for each of the two years in the period ended December 31,
1995 in conformity with generally accepted accounting principles. As described
in Note 1 to the financial statements, pursuant to the provisions of Statement
of Financial Accounting Standards No. 120 (SFAS No. 120), Accounting and
Reporting by Mutual Life Insurance Enterprises and by Insurance Enterprises for
Certain Long-Duration Participating Contracts, financial statements of mutual
life insurance enterprises for periods ending on or before December 31, 1996,
prepared using accounting practices prescribed or permitted by insurance
regulators (statutory financial statements) are no longer considered
presentations in conformity with generally accepted accounting principles when
presented for comparative purposes with the enterprise's financial statements
for periods subsequent to the effective date of SFAS No. 120. Accordingly, our
present opinion on the presentation of the 1995 financial statements in
accordance with generally accepted accounting principles, as presented herein,
is different from that expressed in our previous report.
In our opinion, because of the effects of the matter discussed in the preceding
paragraph, the financial statements referred to above do not present fairly, in
conformity with generally accepted accounting principles, the financial position
of C.M. Life Insurance Company as of December 31, 1995, or the results of its
operations and it cash flows for each of the two years in the period ended
December 31, 1995.
In our opinion, the financial statements referred to above do present fairly, in
all material respects, the financial position of C.M. Life Insurance Company as
of December 31, 1995 and the results of its operations and its cash flows for
each of the two years in the period ended December 31, 1995 in conformity with
accounting practices prescribed or permitted by the Insurance Department of the
State of Connecticut.
ARTHUR ANDERSEN, LLP
Hartford, Connecticut
February 15, 1996
(Except with respect to the matter discussed in Note 1,
as to which the date is March 4, 1996)
3
<PAGE>
C.M. LIFE INSURANCE COMPANY
STATUTORY STATEMENT OF FINANCIAL POSITION
<TABLE>
<CAPTION>
December 31,
1996 1995
------ ------
(In Thousands Except for
Share Information)
<S> <C> <C>
Assets:
Bonds $ 736,524 $736,099
Preferred stocks - 211
Common stocks 55,642 72,361
Mortgage loans 33,791 30,716
Policy loans 132,942 126,014
Cash and short-term instruments 63,688 15,069
Investment and insurance amounts receivable 32,783 23,765
Transfer due from separate account 24,278 22,300
Federal income tax receivable 7,094 -
Other assets 87 1,819
Separate account assets 779,742 531,432
---------- ----------
$1,866,571 $1,559,786
========== ==========
Liabilities:
Policyholders' reserves and funds $ 907,492 $867,672
Policy claims and other benefits 3,843 2,086
Payable to parent and affiliates 9,654 10,823
Federal income taxes - 2,820
Asset valuation reserve 18,475 15,868
Investment reserves 3,329 4,011
Other liabilities 34,292 11,875
Separate account reserves and liabilities 779,742 531,432
---------- ----------
1,756,827 1,446,587
---------- ----------
Shareholder's equity:
Common stock, $200 par value
50,000 shares authorized
12,500 shares issued and outstanding 2,500 2,500
Paid-in capital and contributed surplus 43,759 43,759
Shareholder's equity 63,485 66,940
---------- ----------
109,744 113,199
---------- ----------
$1,866,571 $1,559,786
========== ==========
</TABLE>
See notes to statutory financial statements.
4
<PAGE>
C.M. LIFE INSURANCE COMPANY
STATUTORY STATEMENT OF INCOME
<TABLE>
<CAPTION>
Years Ended December 31,
1996 1995 1994
------ ------ ------
(In Thousands)
<S> <C> <C> <C>
Income:
Premium income $314,372 $260,847 $251,176
Net investment and other income 76,456 84,390 83,354
-------- -------- --------
390,828 345,237 334,530
-------- -------- --------
Benefits and expenses:
Policy benefits and payments 98,966 58,913 44,033
Addition to policyholders' reserves, funds
and separate accounts 210,324 211,403 230,338
Operating expenses 45,448 32,146 14,786
Commissions 24,987 14,092 7,365
State taxes, licenses and fees 3,247 5,017 4,199
-------- -------- --------
382,972 321,571 300,721
Net gain from operations before federal
income taxes 7,856 23,666 33,809
Federal income taxes 6,286 9,376 14,249
-------- -------- --------
Net gain from operations 1,570 14,290 19,560
Net realized capital gain (loss) 635 (540) (1,772)
-------- -------- --------
Net income $ 2,205 $ 13,750 $ 17,788
======== ======== ========
</TABLE>
See notes to statutory financial statements.
5
<PAGE>
C.M. LIFE INSURANCE COMPANY
STATUTORY STATEMENT OF CHANGES IN SHAREHOLDER'S EQUITY
<TABLE>
<CAPTION>
Years Ended December 31,
1996 1995 1994
------ ------ ------
(In Thousands)
<S> <C> <C> <C>
Shareholder's equity, beginning of year $113,199 $103,837 $ 87,898
Increases (decreases) due to:
Net income 2,205 13,750 17,788
Change in asset valuation and investment
reserves (1,923) (9,228) (106)
Change in non-admitted assets (2,765) (1,157) (1,761)
Net unrealized capital gain (loss) (972) 5,997 18
-------- -------- --------
(3,455) 9,362 15,939
-------- -------- --------
Shareholder's equity, end of year $109,744 $113,199 $103,837
======== ======== ========
</TABLE>
See notes to statutory financial statements.
6
<PAGE>
C.M. LIFE INSURANCE COMPANY
STATUTORY STATEMENT OF CASH FLOWS
<TABLE>
<CAPTION>
Years Ended December 31,
1996 1995 1994
------ ------ ------
(In Thousands)
<S> <C> <C> <C>
Operating activities:
Net income (loss) $ 2,205 $ 13,750 $ 17,788
Additions to policyholders'
reserves, funds, and net of transfers
to separate accounts 41,578 84,218 68,764
Net realized capital gain (loss) (635) 540 1,772
Change in receivable (payable)
from parent (1,169) 5,711 (3,870)
Other changes 409 (6,303) (3,306)
--------- --------- ---------
Net cash provided by operating
activities 42,388 97,916 81,148
Investing activities:
Loans and purchases of investments (184,900) (491,893) (332,750)
Sales or maturities of investments
and receipts from repayment of loans 191,131 406,021 249,038
--------- --------- ---------
Net cash provided by (used in)
investing activities 6,231 (85,872) (83,712)
Financing activities:
Net cash provided by financing
activities - - -
Increase (decrease) in short-term
investments 48,619 12,044 (2,564)
Cash and short-term investments,
beginning of year 15,069 3,025 5,589
--------- --------- ---------
Cash and short-term investments,
end of year $ 63,688 $ 15,069 $ 3,025
========= ========= =========
</TABLE>
See notes to statutory financial statements.
7
<PAGE>
NOTES TO STATUTORY FINANCIAL STATEMENTS
1. Summary of Significant Accounting Policies
C.M. Life Insurance Company (the Company) is a wholly owned stock life
insurance subsidiary of Massachusetts Mutual Life Insurance Company
("MassMutual"). On March 1, 1996, the operations of the Company's former
parent, Connecticut Mutual Life Insurance Company, were merged into
MassMutual. The Company is primarily engaged in the sale of flexible premium
universal life insurance and variable annuity products. The Company is
licensed to transact business in all states except New York.
The accompanying statutory financial statements, except as to form, have been
prepared in conformity with the practices of the National Association of
Insurance Commissioners and the accounting practices prescribed or permitted
by the Insurance Department of the State of Connecticut ("statutory
accounting practices"), which prior to 1996 were considered to be in
conformity with generally accepted accounting principles ("GAAP"). In 1993,
the Financial Accounting Standards Board ("FASB") issued interpretation No.
40 ("Fin. 40"), "Applicability of Generally Accepted Accounting Principles to
Mutual Life Insurance and Other Enterprises", which clarified that wholly
owned stock life insurance subsidiaries of mutual life insurance companies
issuing financial statements described as prepared in conformity with GAAP
after 1995 are required to apply all applicable GAAP pronouncements in
preparing those financial statements. In January 1995, the FASB issued
Statement No. 120 ("SFAS 120"), Accounting and Reporting by Mutual Life
Insurance Enterprises and by Insurance Enterprises for Certain Long-Duration
Participating Contracts," which among other things, extended the
applicability of certain FASB statements to mutual life insurance companies
and deferred the effective date of Fin. 40 to financial statements issued or
reissued after 1996. As required by generally accepted auditing standards,
the opinion expressed by our former independent accountants on the 1995 and
1994 financial statements is different from that expressed in their previous
report.
The accompanying statutory financial statements are different in some
respects from GAAP financial statements. The more significant differences are
as follows: (a) acquisition costs, such as commissions and other costs in
connection with acquiring new business, are charged to current operations as
incurred, whereas GAAP would require these expenses to be capitalized and
recognized over the life of the policies; (b) policy reserves are based upon
statutory mortality and interest requirements without consideration of
withdrawals, whereas GAAP reserves would be based upon reasonably
conservative estimates of mortality, morbidity, interest and withdrawals; (c)
bonds are generally carried at amortized cost whereas GAAP would value bonds
at fair value and (d) deferred income taxes are not provided for book-tax
timing differences whereas GAAP would record deferred income taxes.
Management has not yet completed GAAP financial statements, but believes that
shareholders' equity based upon GAAP will be higher than shareholder's equity
based upon statutory accounting practices.
The preparation of financial statements requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities,
as well as disclosures of contingent assets and liabilities, at the date of
the financial statements. Management must also make estimates and assumptions
that affect the amounts of revenues and expenses during the reporting period.
Future events, including changes in the levels of mortality, morbidity,
interest rates and asset valuations, could cause actual results to differ
from the estimates used in the financial statements.
8
<PAGE>
NOTES TO STATUTORY FINANCIAL STATEMENTS, Continued
The following is a description of the Company's current principal accounting
policies and practices.
a. Investments
Bonds and stocks are valued in accordance with rules established by the
National Association of Insurance Commissioners. Generally, bonds are
valued at amortized cost, preferred stocks in good standing at cost, and
common stocks at fair value.
Mortgage loans are valued at principal less unamortized discount.
Policy loans are carried at the outstanding loan balance less amounts
unsecured by the cash surrender value of the policy.
Short-term investments are stated at amortized cost, which approximates
fair value.
In compliance with regulatory requirements, the Company maintains an Asset
Valuation Reserve and an Interest Maintenance Reserve. The Asset Valuation
Reserve and other investment reserves, as prescribed and permitted by the
Connecticut Insurance Department, stabilize the policyholders' contingency
reserves against fluctuations in the value of stocks, as well as declines
in the value of bonds and mortgage loans.
The Interest Maintenance Reserve captures after-tax realized capital gains
and losses which result from changes in the overall level of interest rates
for all types of fixed income investments. This reserve is amortized into
income using the grouped method over the remaining life of the investment
sold or over the remaining life of the underlying asset. Net realized
after tax capital gains of $425 thousand in 1996 and net realized after tax
capital losses of $867 thousand in 1995 and $3,391 thousand in 1994 were
transferred to the Interest Maintenance Reserve. Amortization of the
Interest Maintenance Reserve into net investment income amounted to $37
thousand in 1996, $61 thousand in 1995, and $309 thousand in 1994. In
1996, 1995 and 1994, the Interest Maintenance Reserve resulted in net loss
deferral. In accordance with the practices of the National Association of
Insurance Commissioners, the balance was recorded as a reduction of
shareholder's equity.
Realized capital gains and losses, less taxes, not includable in the
Interest Maintenance Reserve, are recognized in net income. Realized
capital gains and losses are determined using the specific identification
method. Unrealized capital gains and losses are included in shareholder's
equity.
b. Separate Accounts
Separate account assets and liabilities represent segregated funds
administered and invested by the Company for the benefit of variable
annuity and variable life insurance contract holders. The assets consist
principally of marketable securities reported at fair value. Transfers due
from separate account represents the separate account assets in excess of
statutory benefit reserves. Premiums, benefits and expenses of the
separate accounts are reported in the statutory statement of income.
Reserves for these life and annuity contracts have been established using
assumed interest rates and valuation methods that will provide reserves at
least as great as those required by law and contract provisions. The
Company receives administrative and investment advisory fees from these
accounts.
c. Non-admitted Assets
Assets designated as "non-admitted" (principally prepaid agent commissions,
other prepaid expenses and Interest Maintenance Reserve, when in a net loss
deferral position) are excluded from the statutory statement of financial
position. These amounted to $6,604 thousand and $3,839 thousand as of
December 31, 1996 and 1995, respectively and changes therein are charged
directly to shareholder's equity.
9
<PAGE>
NOTES TO STATUTORY FINANCIAL STATEMENTS, Continued
d. Policyholders' Reserves and Funds
Policyholders' reserves for life contracts are developed using accepted
actuarial methods computed principally on the net level premium and the
Commissioners' Reserve Valuation Method bases using the American Experience
and 1980 Commissioners' Standard Ordinary mortality tables with assumed
interest rates ranging from 4.0 to 4.5 percent.
Reserves for single premium deferred annuities are calculated based on the
Commissioners' Annuity Reserve Valuation Method utilizing the change in
fund method and assuming interest on changes in funds of 7.0%, 8.0% and
7.0% in 1996, 1995 and 1994, respectively. Additional reserves are
maintained for contracts where the cash surrender value exceeds the
actuarially determined reserve.
Reserves for policies and contracts considered investment contracts have a
carrying value and fair value of $113,670 thousand (fair value is
determined by discounted cash flow projections).
e. Premium and Related Expense Recognition
Life insurance premium income is recognized annually on the anniversary
date of the policy. Annuity premium is recognized when received.
Commissions and other costs related to the issuance of new policies,
maintenance and settlement costs are charged to current operations.
f. Cash and Short-term Investments
For purposes of the statutory Statement of Cash Flows, the Company
considers all highly liquid short-term investments with a maturity of
twelve months or less from the date of purchase to be cash and short-term
investments.
2. Federal Income Taxes
Provision for federal income taxes is based upon the Company's best estimate
of its tax liability. No deferred tax effect is recognized for temporary
differences that may exist between financial reporting and taxable income.
Accordingly, the reporting of miscellaneous temporary differences, such as
reserves and acquisition costs, resulted in an effective tax rate which is
other than the statutory tax rate.
3. Stockholder's Equity
The Board of Directors of MassMutual has authorized the contribution of funds
to the Company sufficient to meet the capital requirements of all states in
which the Company is licensed to do business. Substantially all of the
statutory stockholder's equity is subject to dividend restrictions relating
to various state regulations which limit the payment of dividends without
prior approval. Under these regulations, $11,320 thousand of stockholder's
equity is available for distribution to shareholders in 1997 without prior
regulatory approval.
4. Related Party Transactions
Investment and administrative services are provided to the Company pursuant
to a management services agreement with MassMutual. Fees incurred under the
terms of the agreement were $45,914 thousand, $34,008 thousand and $16,412
thousand in 1996, 1995 and 1994, respectively.
Effective March, 1996, the Company modified its underwriting agreement with
its affiliates, GR Phelps and MassMutual Distributors, whereby the Company
will pay all future commissions relating to variable annuity business in
exchange for the rights to retain all future policy administration fees and
charges.
10
<PAGE>
NOTES TO STATUTORY FINANCIAL STATEMENTS, Continued
The Company cedes a portion of its life insurance business to MassMutual and
other insurers in the normal course of business. The Company's retention
limit per individual insured is $4 million; the portion of the risk exceeding
the retention limit is reinsured with other insurers. The Company is
contingently liable with respect to ceded reinsurance in the event any
reinsurer is unable to fulfill its contractual obligations.
The Company has a modified coinsurance quota-share reinsurance agreement with
MassMutual whereby the Company cedes 50% of the premiums on certain
universal life policies issued in 1985 and 75% of the premiums with issue
dates on or after January 1, 1986. In return Mass Mutual pays the Company a
stipulated expense allowance, death and surrender benefits, and a modified
coinsurance adjustment. Reserves for payment of future benefits for the ceded
policies are retained by the Company.
The Company also has a stop-loss agreement with MassMutual, with maximum
coverage at $25,000 thousand, under which the Company cedes claims which, in
aggregate, exceed $28,080 thousand in 1996, $24,245 thousand in 1995, and
$18,348 thousand in 1994. For each of the years, the limit was not exceeded.
The Company paid approximately $400 thousand, $602 thousand, and $435
thousand in premiums under the agreement in 1996, 1995 and 1994,
respectively.
5. Investments
The Company maintains a diversified investment portfolio. Investment policies
limit concentration in any asset class, geographic region, industry group,
economic characteristic, investment quality or individual investment.
a. Bonds
The carrying value and estimated fair value of investments in bonds as of
December 31, 1996 and 1995 are as follows:
<TABLE>
<CAPTION>
December 31, 1996
-----------------
Gross Gross Estimated
Carrying Unrealized Unrealized Fair
Value Gains Losses Value
-------- ---------- ---------- ---------
(In Thousands)
<S> <C> <C> <C> <C>
U. S. Treasury Securities $138,751 $ 2,175 $ 964 $139,962
and Obligations of U.S.
Government Corporations
and Agencies
Debt Securities issued by 3,953 53 22 3,984
Foreign Governments
Mortgage-backed securities 37,395 745 725 37,415
State and local governments 10,263 244 101 10,406
Industrial securities 509,227 11,643 3,700 517,170
Utilities 36,935 1,168 159 37,944
-------- ------- ------ --------
Total $736,524 $ 16,028 $5,671 $ 746,881
======== ========= ====== =========
</TABLE>
11
<PAGE>
NOTES TO STATUTORY FINANCIAL STATEMENTS, Continued
<TABLE>
<CAPTION>
December 31, 1995
-----------------
Gross Gross Estimated
Carrying Unrealized Unrealized Fair
Value Gains Losses Value
-------- ---------- ---------- --------
(In Thousands)
<S> <C> <C> <C> <C>
U. S. Treasury Securities $ 27,817 $ 1,764 $ 8 $ 29,573
and Obligations of U.S.
Government Corporations
and Agencies
Debt Securities issued by 11,186 483 295 11,374
Foreign Governments
Mortgage-backed securities 150,694 7,144 347 157,491
Industrial securities 501,252 21,472 711 522,013
Utilities 45,150 2,303 16 47,437
-------- ------- ---- --------
Total $736,099 $33,166 $1,377 $767,888
======== ======= ====== ========
</TABLE>
The carrying value and estimated fair value of bonds at December 31, 1996, by
contractual maturity, are shown below. Expected maturities will differ from
contractual maturities because borrowers may have the right to call or prepay
obligations with or without prepayment penalties.
<TABLE>
<CAPTION>
Estimated
Carrying Fair
Value Value
--------- ---------
(In Thousands)
<S> <C> <C>
Due in one year or less $ 76,698 $ 77,009
Due after one year through five years 284,200 287,363
Due after five years through ten years 202,722 206,317
Due after ten years 84,515 86,874
-------- --------
subtotal 648,135 657,563
-------- --------
Mortgage-backed securities, including
securities guaranteed by the U.S. Government 88,389 89,318
-------- --------
Total $736,524 $746,881
======== ========
</TABLE>
Proceeds from sales of investments in bonds were $162,934 thousand during 1996,
$380,567 thousand during 1995 and $224,884 thousand during 1994. Gross capital
gains of $1,608 thousand in 1996, $3,598 thousand in 1995 and $1,358 thousand in
1994 and gross capital losses of $876 thousand in 1996, $4,658 thousand, in 1995
and $4,439 thousand in 1994 were realized on those sales, a portion of which
were included in the Interest Maintenance Reserve. Estimated fair value of
non-publicly traded bonds is determined by the Company using a pricing matrix.
12
<PAGE>
NOTES TO STATUTORY FINANCIAL STATEMENTS, Continued
b. Stocks
Common stocks had a cost of $47,195 thousand in 1996 and $64,225 thousand in
1995.
c. Mortgages
The fair value of mortgage loans, as determined from a pricing matrix for
performing loans and the estimated underlying real estate value for non-
performing loans, approximated carrying value less valuation reserves held.
d. Other
The carrying value of investments which were non-income producing for the
preceding twelve months was $2,774 thousand at December 31, 1996. The
Company had restructured loans with book values of $21,867 thousand and
$17,128 thousand at December 31, 1996 and 1995, respectively. The loans
typically have been modified to defer a portion of the contracted interest
payments to future periods. Interest deferred to future periods totaled $178
thousand in 1996, $171 thousand in 1995 and $183 thousand in 1994.
It is not practicable to determine the fair value of policy loans as they do
not have a stated maturity.
6. Portfolio Risk Management
The Company manages its investment risks to reduce interest rate and duration
imbalances determined in asset/liability analyses. The fair values of these
instruments, which are not recorded in the financial statements, are based
upon market prices or prices obtained from brokers. The Company does not
hold or issue financial instruments for trading purposes.
The Company utilizes interest rate swap agreements and options to reduce
interest rate exposures arising from mismatches between assets and
liabilities and to modify portfolio profiles to manage other risks
identified. Under interest rate swaps, the Company agrees to exchange, at
specified intervals, the difference between fixed and floating interest rates
calculated by reference to an agreed-upon notional principal amount. Net
amounts receivable and payable are accrued as adjustments to interest income
and included in investment and insurance amounts receivable on the Statutory
Statement of Financial Position. Gains and losses realized on the
termination of contracts are amortized through the Interest Maintenance
Reserve over the remaining life of the associated contract. At December 31,
1996 and 1995, the Company had swaps with notional amounts of $13,000
thousand. The fair value of these instruments was $103 thousand at December
31, 1996 and $491 thousand at December 31, 1995. During 1996 options
(protective puts) were utilized to hedge equity exposures. The net 1996
realized losses from this activity were $837 thousand. The notional amount of
options totaled $34,700 thousand as of December 31, 1996.
During 1994 interest rate futures were acquired to hedge the reinvestment of
anticipated proceeds from a bulk mortgage sale. The actual gain of $95
thousand was amortized over the expected term of the assets acquired with the
mortgage sale proceeds. No interest rate futures were held as of December 31,
1996 and 1995.
13
<PAGE>
NOTES TO STATUTORY FINANCIAL STATEMENTS, Continued
7. Liquidity
The withdrawal characteristics of the policyholder's reserves and funds,
including separate accounts, and the invested assets which support them at
December 31, 1996 are illustrated below:
<TABLE>
<CAPTION>
(In thousands)
<S> <C>
Total policyholders' reserves and funds and
separate account liabilities $1,687,234
Not subject to discretionary withdrawal (1,446)
Policy loans (132,941)
----------
Subject to discretionary withdrawal $1,552,847
==========
Total invested assets, including separate
investment accounts $1,802,416
Policy loans and other invested assets (216,721)
----------
Readily available marketable instruments $1,585,695
===========
</TABLE>
8. Business Risks and Contingencies
The Company is subject to insurance guaranty fund laws in the states in
which it does business. These laws assess insurance companies amounts to be
used to pay benefits to policyholders and claimants of insolvent insurance
companies. Many states allow these assessments to be credited against future
premium taxes. The Company believes such assessments in excess of amounts
accrued will not materially affect its financial position, results of
operations or liquidity. In 1996, the Company elected not to admit $1,621
thousand of guaranty fund premium tax offset receivable relating to prior
assessments.
The Company is involved in regulatory proceedings and various litigation in
the ordinary course of business. In the opinion of management, the ultimate
resolution of such proceedings and litigation will not result in fines or
judgments which, in the aggregate, would materially affect the Company's
financial position.
9. Reclassifications
Certain 1995 and 1994 amounts have been reclassified to conform with the
current year presentation.
10. Affiliated Companies
The relationship of the Company, its parent and affiliated companies as of
December 31, 1996 is illustrated below. Subsidiaries are wholly-owned by the
parent, except as noted.
Parent
------
Massachusetts Mutual Life Insurance Company
Subsidiaries of Massachusetts Mutual Life Insurance Company
-----------------------------------------------------------
C.M. Assurance Company
C.M. Benefit Insurance Company
C.M. Life Insurance Company
MassMutual Holding Company
MassMutual Holding Company Two, Inc. (Sold in March 1996)
MassMutual of Ireland, Limited
MML Bay State Life Insurance Company
MML Distributors, LLC
14
<PAGE>
NOTES TO STATUTORY FINANCIAL STATEMENTS, Continued
Subsidiaries of MassMutual Holding Company
------------------------------------------
GR Phelps, Inc.
MassMutual Holding Trust I
MassMutual Holding Trust II
MassMutual Holding MSC, Inc.
MassMutual International, Inc.
MassMutual Reinsurance Bermuda (Sold in December 1996)
MML Investor Services, Inc.
State House One (Liquidated in December 1996)
Subsidiaries of MassMutual Holding Trust I
------------------------------------------
Antares Leveraged Capital Corporation
Charter Oak Capital Management, Inc.
Cornerstone Real Estate Advisors, Inc.
DLB Acquisition Corporation
Oppenheimer Acquisition Corporation - 86.15%
Subsidiaries of MassMutual Holding Trust II
-------------------------------------------
CM Advantage, Inc.
CM International, Inc.
CM Property Management, Inc.
High Yield Management, Inc.
MMHC Investments, Inc.
MML Realty Management
Urban Properties, Inc.
Westheimer 335 Suites, Inc.
Subsidiaries of MassMutual International
----------------------------------------
MassLife Seguros de Vida (Argentina) S. A.
MassMutual International (Bermuda) Ltd.
Mass Seguros de Vida (Chile) S. A.
MassMutual International (Luxemburg) S. A.
MassMutual Holding MSC, Incorporated
------------------------------------
MassMutual/Carlson CBO N. V. - 50%
MassMutual Corporate Value Limited - 46%
Affiliates of Massachusetts Mutual Life Insurance Company
---------------------------------------------------------
MML Series Investment Fund
MassMutual Institutional Funds
Oppenheimer Value Stock Fund
15
<PAGE>
PART C OTHER INFORMATION
<TABLE>
<CAPTION>
<S> <C>
Item 24 Financial Statements and Exhibits
---------------------------------
(a) Financial Statements:
Financial Statements Included in Part A
---------------------------------------
Condensed Financial Information
Financial Statements Included in Part B
---------------------------------------
Registrant
----------
Reports of Independent Accountants
Statement of Assets and Liabilities as of December 31, 1996
Statement of Operations for the year ended December 31, 1996
Statement of Changes in Net Assets for the years ended December 31,
1996, and 1995
Notes to Financial Statements
The Depositor
-------------
Reports of Independent Accountants
Statutory Statement of Financial Position as of December 31, 1996
and 1995
Statutory Statement of Income for the Years ended
December 31, 1996, 1995 and 1994
Statutory Statement of Changes in Shareholder's Equity for the
years ended December 31, 1996, 1995 and 1994
Statutory Statement of Cash Flows for the years ended December 31,
1996, 1995 and 1994
Notes to Statutory Financial Statements
(b) Exhibits:
(1) Resolution of the Board of Directors of C.M. Life Insurance Company
authorizing the establishment of the Separate Account. /1/
(2) Not Applicable.
(3) (a) Form of Distribution Agreement between the Registrant and MML
Distributors LLC. /5/
(b) Underwriting and Servicing Agreement between MML Investors
Services, Inc. and C.M. Life Insurance Company. /4/
(4) (a) Form of Individual and Group Contracts, Endorsements and
Certificates for the Panorama Plus Annuity. /3/
(5) Form of Applications for the Panorama Plus Annuity Individual
Contracts. /3/
(6) (a) Charter of C.M. Life Insurance Company. /1/
(b) By Laws of C.M. Life Insurance Company. /1/
(7) Not Applicable.
(8) (a) Agreement to Purchase Shares by and between C.M. Life Insurance
Company and Connecticut Mutual Financial Services Series Fund I,
Inc. /2/
(9) Opinion and Consent of Counsel. /5/
</TABLE>
18
<PAGE>
(10) (i) Consent of Coopers & Lybrand, L.L.P., Independent
Accountants. /5/
(ii) Consent of Arthur Andersen, LLP, Independent Accountants. /5/
(iii)Powers of Attorney /5/
(11) Not Applicable.
(12) Not Applicable.
(13) Performance Calculations. /3/
(14) Financial Data Schedule. /5/
1 Incorporated by reference to the initial registration statement on Form
N-4 for the Panorama Plus Separate Account (File No. 33-45122) as filed
with the Securities and Exchange Commission on January 16, 1992.
2 Incorporated by reference to Pre-Effective Amendment No. 1 to the
registration statement on Form N-4 for the Panorama Plus Separate Account
(File No. 33-45122) as filed with the Securities and Exchange Commission on
April 13, 1992.
3 Incorporated by reference to Post-Effective Amendment No. 1 to the
registration statement on Form N-4 for the Panorama Plus Separate Account
(File No. 33-45122) as filed with the Securities and Exchange Commission on
April 23, 1993.
4 Incorporated by reference to Exhibit 1(b) to the registration statement on
Form S-1 for C.M. Life Insurance Company (File No. 333-02347) as filed with
the Securities and Exchange Commission on April 8, 1996.
5 Filed herewith.
19
<PAGE>
ITEM 25. DIRECTORS AND OFFICERS OF THE DEPOSITOR
C.M. LIFE INSURANCE COMPANY
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C>
NAME AND POSITION PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS
- -----------------------------------------------------------------------------------------------------------------------------------
Lawrence V. Burkett, Jr., Director, Director, President and Chief Executive Officer, C.M. Life, since 1996;
President and Executive Vice Chief Executive Officer Executive Vice President and General Counsel, MassMutual, since 1993;
Senior Vice President and Deputy General Counsel, 1992-1993.
- -----------------------------------------------------------------------------------------------------------------------------------
John B. Davies, Director Director, C.M. Life, since 1996; Executive Vice President, MassMutual,
since 1994; Associate Executive Vice President, 1994-1994; General Agent,
1982-1993.
- -----------------------------------------------------------------------------------------------------------------------------------
Daniel J. Fitzgerald, Director Director, C.M. Life, since 1996; Executive Vice President, Corporate
Financial Operations MassMutual, since 1994; Senior Vice President,
1991-1994.
- -----------------------------------------------------------------------------------------------------------------------------------
Stuart H. Reese, Director and Senior Vice Director and Senior Vice President-Investments, C.M. Life, since 1996;
President-Investments Senior Vice President, MassMutual, since 1993; Investment Manager, Aetna
Life and Casualty and Affiliates, 1979-1993.
- -----------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL OFFICERS (other than those who are also Directors):
- ------------------------------------------------------------------------------------------------------------------------------------
Paul D. Adornato Senior Vice President-Operations, C.M. Life, since 1996; Senior Vice
President, MassMutual, since 1986.
- ------------------------------------------------------------------------------------------------------------------------------------
Anne Melissa Dowling Senior Vice President-Large Corporate Marketing, C.M. Life, since 1996;
Senior Vice President, MassMutual, since 1996; Chief Investment Officer,
Connecticut Mutual Life Insurance Company, 1994-1996; Senior Vice President-
International, Travelers Insurance Co., 1987-1993 .
- ------------------------------------------------------------------------------------------------------------------------------------
Maureen R. Ford Senior Vice President-Annuity Marketing, C.M. Life, since 1996; Senior Vice
President, MassMutual, since 1996; Marketing Officer, Connecticut Mutual
Life Insurance Company, 1989-1996.
- ------------------------------------------------------------------------------------------------------------------------------------
Isadore Jermyn Senior Vice President and Actuary, C.M. Life, since 1996; Senior Vice
President and Actuary, MassMutual, since 1995; Vice President and Actuary,
1980-1995.
- ------------------------------------------------------------------------------------------------------------------------------------
Ann Iseley Treasurer, C.M. Life, since 1996; Vice President and Treasurer, MassMutual,
since 1996; Chief Financial and Operations Officer, Connecticut Mutual
Financial Services, 1994-1996; Controller, The Mack Company, 1993-1994; Vice
President-Finance, Mutual of New York, 1988-1993 .
- ------------------------------------------------------------------------------------------------------------------------------------
Ann F. Lomeli Secretary, C.M. Life, since 1988; Vice President, Associate Secretary and
Associate General Counsel, MassMutual, since 1996; Corporate Secretary and
Counsel, Connecticut Mutual Life Insurance Company, 1988-1996.
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
ITEM 26. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE DEPOSITOR OR
REGISTRANT
The assets of the Registrant, under state law, are assets of C.M. Life.
C.M. Life Insurance Company is 100% owned by Massachusetts Mutual Life Insurance
Company.
The Registrant may also be deemed to be under common control with other separate
accounts established by MassMutual and its life insurance subsidiaries, C.M.
Life Insurance Company and MML Bay State Life Insurance Company, which are
registered as unit investment trusts under the Investment Company Act of 1940.
The discussion that follows indicates those entities owned directly or
indirectly by Massachusetts Mutual Life Insurance Company:
20
<PAGE>
LIST OF SUBSIDIARIES AND AFFILIATES
<TABLE>
<CAPTION>
<S> <C>
1. MassMutual Holding Company, a Delaware corporation, all the stock of which
is owned by MassMutual.
2. MML Series Investment Fund, a registered open-end investment company
organized as a Massachusetts business trust, all of the shares of which are
owned by separate accounts of MassMutual and companies controlled by
MassMutual.
3. MassMutual Institutional Funds, a registered open-end investment company
organized as a Massachusetts business trust, all of the shares are owned by
MassMutual.
4. MML Bay State Life Insurance Company, a Missouri corporation, all the stock
of which is owned by MassMutual.
5. MassMutual of Ireland, Ltd., incorporated in the Republic of Ireland, to
operate a group life and health claim office for MassMutual, all of the
stock of which is owned by MassMutual.
6. CM Assurance Company, a Connecticut life, accident, disability and health
insurer, all the stock of which is owned by MassMutual.
7. CM Benefit Insurance Company, a Connecticut life, accident, disability and
health insurer, all the stock of which is owned by MassMutual.
8. C.M. Life Insurance Company, a Connecticut life, accident, disability and
health insurer, all the stock of which is owned by MassMutual.
9. MML Distributors, LLC, formerly known as Connecticut Mutual Financial
Services, LLC, a registered broker-dealer incorporated as a limited
liability company in Connecticut. MassMutual has a 99% ownership interest
and G.R. Phelps & Co. has a 1% ownership interest.
10. Panorama Series Fund, Inc., a registered open-end investment company
organized as a Maryland corporation. Shares of the fund are sold only to
MassMutual and its affiliates.
11. MassMutual Holding Trust I, a Massachusetts business trust, which acts as a
holding company for certain MassMutual subsidiaries and affiliates, all of
the stock of which is owned by MassMutual Holding Company.
12. MassMutual Holding Trust II, a Massachusetts business trust, which acts as
a holding company for certain MassMutual subsidiaries and affiliates, all
of the stock of which is owned by MassMutual Holding Company.
13. MassMutual Holding MSC, Inc., a Massachusetts corporation, which acts as a
holding company for certain MassMutual subsidiaries and affiliates, all of
the stock of which is owned by MassMutual Holding Company.
14. MML Investors Services, Inc., registered broker-dealer incorporated in
Massachusetts, all the stock of which is owned by MassMutual Holding
Company.
15. G.R. Phelps & Company, Inc., Connecticut corporation which formerly
operated as a securities broker-dealer, all the stock of which is owned by
MassMutual Holding Company.
</TABLE>
21
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
16. MassMutual International, Inc., a Delaware corporation that acts as a
holding company of and provides services to international insurance
companies, all of the stock of which is owned by MassMutual Holding
Company.
17. MassLife Seguros de Vida S.A. (Argentina), a life insurance company
incorporated in Argentina. MassMutual International Inc. owns 99.99% of the
outstanding capital stock of MassLife Seguros de Vida S.A.
18. Cornerstone Real Estate Advisers, Inc., a Massachusetts equity real estate
advisory corporation, all the stock of which is owned by MassMutual Holding
Trust I.
19. DLB Acquisition Corporation ("DLB") is a Delaware corporation, which serves
as a holding company for certain investment advisory subsidiaries of
MassMutual. MassMutual Holding Trust I owns 83.7% of the outstanding
capital stock of DLB.
20. Oppenheimer Acquisition Corporation ("OAC") is a Delaware corporation,
which serves as a holding company for OppenheimerFunds, Inc. MassMutual
Holding Trust I owns 86% of the capital stock of OAC
21. Antares Leveraged Capital Corp., a Delaware corporation that operates as a
finance company, all of the stock of which is owned by MassMutual Holding
Trust I.
22. Charter Oak Capital Management, Inc., a Delaware corporation that operates
as an investment manager. MassMutual Holding Trust I owns 80% of the
capital stock of Charter Oak.
23. MML Realty Management Corporation, a property manager incorporated in
Massachusetts, all the stock of which is owned by MassMutual Holding Trust
II.
24. Westheimer 335 Suites, Inc., was incorporated in Delaware to serve as a
general partner of the Westheimer 335 Suites Limited Partnership.
MassMutual Holding Trust II owns all the stock of Westheimer 335 Suites,
Inc.
25. CM Advantage, Inc., a Connecticut corporation that acts as a general
partner in real estate limited partnerships. MassMutual Holding Trust II
owns all of the outstanding stock.
26. CM International, Inc., a Delaware corporation that holds a mortgage pool
and issues collateralized bond obligations. MassMutual Holding Trust II
owns all the outstanding stock of CM International, Inc.
27. CM Property Management, Inc., a Connecticut real estate holding company,
all the stock of which is owned by MassMutual Holding Trust II.
28. Urban Properties, Inc., a Delaware real estate holding and development
company, all the stock of which is owned by MassMutual Holding Trust II.
29. MMHC Investment, Inc., a Delaware corporation which is a passive investor
in MassMutual High Yield Partners LLC. MassMutual Holding Trust II owns all
the outstanding stock of MMHC Investment, Inc.
30. HYP Management, Inc., a Delaware corporation which is the LLC Manager for
MassMutual High Yield Partners LLC and owns 1.28% of the LLC units of such
entity. MassMutual Holding Trust II owns all the outstanding stock of HYP
Management, Inc.
31. MassMutual Corporate Value Limited, a Cayman Islands corporation that owns
approximately 90% of MassMutual Corporate Value Partners Limited.
MassMutual Holding MSC, Inc. owns 46.19% of the outstanding capital stock
of MassMutual Corporate Value Limited.
</TABLE>
22
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
32. MassMutual International (Bermuda) Ltd., a Bermuda life insurance company,
all of the stock of which is owned by MassMutual International Inc.
33. MassMutual Internacional (Chile) S.A. a Chilean corporation, which operates
as a holding company. MassMutual International Inc. owns 99% of the
outstanding shares and MassMutual Holding Company owns the remaining 1% of
the shares.
34. MassMutual International (Luxembourg) S.A. a Luxembourg corporation, which
operates as an insurance company. MassMutual International Inc. owns 99% of
the outstanding shares and MassMutual Holding Company owns the remaining 1%
of the shares.
35. Mass Seguros de Vida S.A., a life insurance company incorporated in Chile.
MassMutual Holding Company owns 33.5% of the outstanding capital stock of
Mass Seguros de Vida S.A.
36. MML Insurance Agency, Inc., a licensed insurance broker incorporated in
Massachusetts, all of the stock of which is owned by MML Investors
Services, Inc.
37. MML Securities Corporation, a Massachusetts securities corporation, all of
the stock of which is owned by MML Investors Services, Inc.
38. OppenheimerFunds, Inc., a registered investment adviser incorporated in
Colorado, all of the stock of which is owned by Oppenheimer Acquisition
Corporation
39. David L. Babson and Company, Incorporated, a registered investment adviser
incorporated in Massachusetts, all of the stock of which is owned by DLB
Acquisition Corporation.
40 Cornerstone Office Management, LLC, a Delaware limited liability company
that is 50% owned by Cornerstone Real Estate Advisers, Inc. and 50% owned
by MML Realty Management Corporation.
41. Westheimer 335 Suites Limited Partnership, a Texas limited partnership of
which Westheimer 335 Suites, Inc. is the general partner.
42. MassMutual High Yield Partners LLC, a Delaware limited liability company,
that operates as a high yield bond fund. MassMutual holds 5.28%, MMHC
Investment Inc. holds 35.99%, and HYP Management, Inc. hold 1.28% for a
total of 42.55% of the ownership interest in this company.
43 MassMutual Corporate Value Partners Limited, a Cayman Islands corporation
that operates as a high yield bond fund. MassMutual Corporate Value Limited
holds an approximately 90% ownership interest in this company.
44. First Israel Mezzanine Investors, Ltd., an Israeli corporation which
operates as managing general partner of First Israel Mezzanine Investors
Fund, LP. MassMutual holds a 33% ownership interest in First Israel
Mezzanine Investors, Ltd.
45. First Israel Mezzanine Investors Fund, LP, a Delaware limited partnership,
of which MassMutual holds a 37.5% ownership interest.
46. MBD Mezzanine Investments, LLC, a Delaware limited liability company, which
operates as the participating general partner of First Israel Mezzanine
Investors Fund, LP. MassMutual holds a 33% ownership interest in MBD
Mezzanine Investments, LLC.
</TABLE>
23
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
47. Diversified Insurance Services Agency of America, Inc. (Alabama), a
licensed insurance broker incorporated in Alabama. MML Insurance Agency,
Inc. owns all the shares of outstanding stock.
48. Diversified Insurance Services Agency of America, Inc. (Hawaii), a licensed
insurance broker incorporated in Hawaii. MML Insurance Agency, Inc. owns
all the shares of outstanding stock.
49. MML Insurance Agency of Nevada, Inc., a Nevada corporation that operates as
an insurance broker, all of the stock of which is owned by MML Insurance
Agency, Inc.
50. MML Insurance Agency of Ohio, Inc., a subsidiary of MML Insurance Agency,
Inc., is incorporated in the state of Ohio that operates as an insurance
broker. The outstanding capital stock is controlled by MML Insurance
Agency, Inc. by means of a voting trust.
51. MML Insurance Agency of Texas, Inc., a subsidiary of MML Insurance Agency,
Inc., is incorporated in the state of Texas that operates as an insurance
broker. The outstanding capital stock is controlled by MML Insurance
Agency, Inc. by means of a voting trust.
52. MML Insurance Agency of Mississippi, P.C., a Mississippi professional
corporation that operates as an insurance broker, all of the stock of which
is owned by MML Insurance Agency, Inc.
53. Origen Inversiones S.A., a Chilean corporation which operates as a holding
company. MassMutual Internacional (Chile) S.A. holds a 33.5% ownership
interest in this corporation.
54. Babson Securities Corporation, a registered broker-dealer incorporated in
Massachusetts, all of the stock of which is owned by David L. Babson and
Company, Incorporated.
55. Potomac Babson Incorporated, a Massachusetts corporation, is a registered
investment adviser. David L. Babson and Company Incorporated owns 60% of
the outstanding shares of Potomac Babson Incorporated.
56. Babson-Stewart-Ivory International, a Massachusetts general partnership,
which operates as a registered investment adviser. David L. Babson and
Company Incorporated holds a 50% ownership interest in the partnership.
57. Oppenheimer Value Stock Fund ("OVSF) is a series of Oppenheimer Integrity
Funds, a Massachusetts business trust. OVSF is a registered open-end
investment company of which MassMutual owns 40% of the outstanding shares
of beneficial interest.
58. Oppenheimer Series Fund I Inc., a Maryland corporation and a registered
open-end investment company of which MassMutual and its affiliates own
approximately 27% of the outstanding shares of beneficial interest.
59. Centennial Asset Management Corporation, a Delaware corporation that serves
as the investment adviser and general distributor of the Centennial Funds.
OppenheimerFunds, Inc. owns all the stock of Centennial Asset Management
Corporation.
60. HarbourView Asset Management Corporation, a registered investment adviser
incorporated in New York, all the stock of which is owned by
OppenheimerFunds, Inc.
61. Main Street Advisers, Inc., a Delaware corporation, all the stock of which
is owned by OppenheimerFunds, Inc.
62. OppenheimerFunds Distributor, Inc., a registered broker-dealer incorporated
in New York, all the stock of which is owned by OppenheimerFunds, Inc.
</TABLE>
24
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
63. Oppenheimer Partnership Holdings, Inc., a Delaware holding company, all the
stock of which is owned by OppenheimerFunds, Inc.
64. Shareholder Financial Services, Inc., a transfer agent incorporated in
Colorado, all the stock of which is owned by OppenheimerFunds, Inc.
65. Shareholder Services, Inc., a transfer agent incorporated in Colorado,
all the stock of which is owned by OppenheimerFunds, Inc.
66. MultiSource Service, Inc., a Colorado corporation that operates a clearing
broker, all of the stock of which is owned by OppenheimerFunds, Inc.
67. Centennial Capital Corporation, a former sponsor of unit investment trust
incorporated in Delaware, all the stock of which is owned by Centennial
Asset Management Corporation.
68. Compensa Compania Seguros De Vida, a Chilean insurance company. Origen
Inversiones S.A. owns 99% of the outstanding shares of this company
69. Cornerstone Suburban Office Investors, LP, a Delaware limited partnership,
which operates as a real estate operating company. Cornerstone Office
Management, LLC holds a 1% general partnership interest in this fund and
MassMutual holds a 99% limited partnership interest.
70. 505 Waterford Park Limited Partnership, a Delaware limited partnership,
which holds title to an office building in Minneapolis, Minnesota. MML
Realty Management Corporation holds a 1% general partnership interest in
this partnership and MassMutual holds a 99% limited partnership interest.
71. The DLB Fund Group, an open-end management investment company, of which
MassMutual owns at least 25% of each series.
MassMutual is the investment adviser the following investment companies, and as
such may be deemed to control them.
1. MassMutual Corporate Investors, a registered closed-end Massachusetts
business trust.
2. MassMutual Participation Investors, a registered closed-end Massachusetts
business trust.
3. MML Series Investment Fund, a registered open-end Massachusetts business
trust, all of the shares are owned by separate accounts of MassMutual and
companies controlled by MassMutual.
4. MassMutual Institutional Funds, a registered open-end Massachusetts
business trust, all of the shares are owned by MassMutual.
5. MassMutual/Carlson CBO N.V., a Netherlands Antilles corporation that issued
Collateralized Bond Obligations on or about May 1, 1991, which is owned
equally by MassMutual interests (MassMutual and MassMutual Holding MSC,
Inc.) and Carlson Investment Management Co.
6. MassMutual Corporate Value Partners, Limited, an off-shore unregistered
investment company.
7. MassMutual High Yield Partners LLC, a high yield bond fund organized as
Delaware limited liability company.
</TABLE>
25
<PAGE>
ITEM 27. NUMBER OF CONTRACT OWNERS
As of March 1, 1997, there were 19,274 Contract Owners in the Separate
Account.
ITEM 28. INDEMNIFICATION
Previously filed with Pre-Effective Amendment No. 1 to this Registration
Statement on Form N-4 filed April 13, 1992 (File No. 33-45122) and incorporated
herein by reference.
ITEM 29. PRINCIPAL UNDERWRITER
(a) MML Distributors, LLC, a wholly owned subsidiary of MassMutual acts as
principal underwriter for registered separate accounts of MassMutual, C.M. Life
and MML Bay State.
(b)(1) MML Distributors, LLC is the principal underwriter of the Contracts. The
following people are officers and directors of the principal underwriter.
OFFICERS AND MEMBER REPRESENTATIVES
MML DISTRIBUTORS, LLC
<TABLE>
<CAPTION>
Name and Position
with Principal Underwriter Principal Business Address
- -------------------------- --------------------------
<S> <C>
Kenneth M. Rickson One Monarch Place
Member Representative 1414 Main Street
G.R. Phelps & Co., Inc. Springfield, MA 01144-1013
Margaret Sperry 1295 State Street
Member Representative Springfield, MA 01111-0001
Massachusetts Mutual
Life Insurance Co.
Kenneth M. Rickson One Monarch Place
President 1414 Main Street
Springfield, MA 01144-1013
Ronald E. Thomson One Monarch Place
Vice President 1414 Main Street
Springfield, MA 01144-1013
Michael L. Kerley One Monarch Place
Vice President 1414 Main Street
Chief Legal Officer Springfield, MA 01144-1013
Assistant Secretary
John O'Connor One Monarch Place
Vice President 1414 Main Street
Springfield, MA 01144-1013
Robert S. Rosenthal One Monarch Place
Compliance Officer 1414 Main Street
Springfield, MA 01144-1013
</TABLE>
26
<PAGE>
<TABLE>
<S> <C>
James T. Birchall One Monarch Place
Treasurer 1414 Main Street
Springfield, MA 01144-1013
Bruce C. Frisbie 1295 State Street
Assistant Treasurer Springfield, MA 01111-0001
Raymond W. Anderson 140 Garden Street
Assistant Treasurer Hartford, CT 01654
Ann F. Lomeli 1295 State Street
Secretary Springfield, MA 01111-0001
</TABLE>
(b)(2) MML Investors Services, Inc. is the co-underwriter of the Contracts.
The following people are the officers and directors of the co-underwriter.
MML INVESTORS SERVICES, INC.
OFFICERS AND DIRECTORS
<TABLE>
<CAPTION>
Name and Position
with Co-Underwriter Principal Business Address
- ------------------- --------------------------
<S> <C>
Kenneth M. Rickson One Monarch Place
President and Chief 1414 Main Street
Operating Officer Springfield, MA 01144-1013
Michael L. Kerley One Monarch Place
Second Vice President 1414 Main Street
Chief Legal Officer Springfield, MA 01144-1013
Assistant Secretary
Ronald E. Thomson One Monarch Place
Treasurer and Second 1414 Main Street
Vice President Springfield, MA 01144-1013
Thomas J. Finnegan, Jr. 1295 State Street
Secretary/Clerk Springfield, MA 01111
Marilyn A. Sponzo One Monarch Place
Assistant Secretary 1414 Main Street
Springfield, MA 01144-1013
John E. Forrest One Monarch Place
Second Vice President 1414 Main Street
National Sales Director Springfield, MA 01144-1013
Eileen D. Leo One Monarch Place
Assistant Treasurer 1414 Main Street
Springfield, MA 01103-1013
William Bartol One Monarch Place
Compliance Officer 1414 Main Street
Springfield, MA 01144-1013
Robert S. Rosenthal One Monarch Place
Compliance Officer 1414 Main Street
Springfield, MA 01144-1013
</TABLE>
27
<PAGE>
<TABLE>
<S> <C>
Trudy A. Fearon One Monarch Place
Sr. Registered Options Principal 1414 Main Street
Springfield, MA 01144-1013
Dennis L. Reyhons 1295 State Street
Regional Supervisor/South Springfield, MA 01111
Nicholas J. Orphan 245 Peach Tree Center Ave.
Regional Supervisor/South Suite 2330
Atlanta, GA 30303
</TABLE>
28
<PAGE>
MML INVESTORS SERVICES, INC. Page 2
OFFICERS AND DIRECTORS
<TABLE>
<CAPTION>
Name and Position
with Co-Underwriter Principal Business Address
- ------------------- --------------------------
<S> <C>
William L. Tindall 1295 State Street
Chief Pension Management Springfield, MA 01111
Field Force Supervisor
Robert W. Kumming 1295 State Street
Regional Pension Management Springfield, MA 01111
Supervisor (East/Central)
Peter J. Zummo 1295 State Street
Regional Pension Management Springfield, MA 01111
Supervisor (South/West)
Bruce Lukowiak 6263 North Scottsdale Rd.
Regional Supervisor/West Suite 222
Scottsdale, AZ 85250
Robert Burke One Lincoln Centre
Regional Supervisor/Central Suite 1490
Oak Brook Terrace, IL
60181-4271
Lawrence V. Burkett 1295 State Street
Chairman of the Board Springfield, MA 01111
of Directors
Peter Cuozzo, CLU, ChFC 1295 State Street
Director Springfield, MA 01111
John B. Davies 1295 State Street
Director Springfield, MA 01111
Daniel J. Fitzgerald 1295 State Street
Director Springfield, MA 01111
Maureen R. Ford 140 Garden Street
Director Hartford, CT 01654
Gary T. Huffman 1295 State Street
Director Springfield, MA 01111
Isadore Jermyn, FIA, ASA 1295 State Street
Director Springfield, MA 01111
Susan Alfano 1295 State Street
Director Springfield, MA 01111
Anne Melissa Dowling 140 Garden Street
Director Hartford, CT 01654
</TABLE>
29
<PAGE>
ITEM 30. LOCATION OF ACCOUNTS AND RECORDS
The records to be maintained by Section 31(a) of the Investment
Company Act of 1940 and Rules 31a-1 to 31a-3 promulgated thereunder, are
maintained by C.M. Life at 140 Garden Street, Hartford, Connecticut 06154 and by
MMLISI at 1414 Main Street, Springfield, MA 01144-1013.
ITEM 31. MANAGEMENT SERVICES.
None.
ITEM 32. UNDERTAKINGS
Previously filed with Pre-Effective Amendment No. 1 to this Registration
Statement on Form N-4 filed April 13, 1992 (File No. 33-45122) and incorporated
herein by reference.
C.M. Life Insurance Company hereby represents that the fees and charges deducted
under the group and individual flexible premium deferred annuity contracts
described in this Registration Statement in the aggregate, are reasonable in
relation to the services rendered, the expenses expected to be incurred, and the
risks assumed by C.M. Life Insurance Company.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant has
caused this Post-Effective Amendment No. 7 to Registration Statement No.
33-45122 to be signed on its behalf by the undersigned thereunto duly
authorized, all in the city of Springfield and the Commonwealth of
Massachusetts, on the 21st day of April, 1997.
PANORAMA PLUS SEPARATE ACCOUNT
C.M. LIFE INSURANCE COMPANY
(Depositor)
By: /s/ Lawrence V. Burkett, Jr.*
------------------------------------------------------
Lawrence V. Burkett, Jr., President and Chief Executive Officer
C.M. Life Insurance Company
/s/ Richard M. Howe On April 21, 1997, as Attorney-in-Fact pursuant to
- ------------------- powers of attorney filed herewith.
*Richard M. Howe
As required by the Securities Act of 1933, this Post-Effective Amendment
No. 7 to Registration Statement No. 33-45122 has been signed by the following
persons in the capacities and on the duties indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Lawrence V. Burkett, Jr.* President, Chief Executive April 21, 1997
- ----------------------------- and Director
Lawrence V. Burkett, Jr.
/s/ Ann Iseley* Treasurer (Principal Financial April 21, 1997
- ------------------------------ Officer)
Ann Iseley
</TABLE>
30
<PAGE>
<TABLE>
<S> <C> <C>
/s/ John Miller, Jr.* Second Vice President and Comptroller April 21, 1997
- ------------------------------- (Principal Accounting Officer)
John Miller, Jr.
/s/ John B. Davies* Director April 21, 1997
- -------------------------------
John B. Davies
/s/ Daniel F. Fitzgerald* Director April 21, 1997
- -------------------------------
Daniel F. Fitzgerald
/s/ Stuart H. Reese* Director April 21, 1997
- -------------------------------
Stuart H. Reese
/s/ Richard M. Howe On April 21, 1997, as Attorney-in-Fact pursuant to
- ------------------------------- powers of attorney filed herewith.
*Richard M. Howe
</TABLE>
31
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
- -------
<S> <C>
(3) (a) Form of Distribution Agreement with MML Distributors, LLC
(9) Consent of Counsel
(10) (i) Consent of Coopers & Lybrand, L.L.P., Independent Accountants
(ii) Consent of Arthur Andersen, LLP, Independent Accountants
(iii) Powers of Attorney
(14) Financial Data Schedule
</TABLE>
32
<PAGE>
EXHIBIT 3(i)(a)
UNDERWRITING AND
SERVICING AGREEMENT
This UNDERWRITING AND SERVICING AGREEMENT is made this 1st day of May, 1996, by
and between MML Distributors, LLC ("MML DISTRIBUTORS") and Massachusetts Mutual
Life Insurance Company ("MassMutual"), on its own behalf and on behalf of
_______________ Separate Account (the "Separate Account"), a separate account of
MassMutual, as follows:
WHEREAS, the Separate Account was established on _____________ pursuant to
authority of the Board of Directors of MassMutual in order to set aside and
invest assets attributable to certain variable annuity contracts (the
"Contracts") issued by MassMutual; and
WHEREAS, MassMutual has registered the Separate Account under the Investment
Company Act of 1940, as amended, (the "1940 Act") and has registered the
Contracts under the Securities Act of 1933, as amended, (the "1933 Act"); and
WHEREAS, MassMutual will continue the effectiveness of the registrations of the
Separate Account under the 1940 Act and the Contracts under the 1933 Act; and
WHEREAS, MassMutual intends for the Contracts to be sold by agents and brokers
who are required to be registered representatives of a broker-dealer that is
registered with the Securities and Exchange Commission (the "SEC") under the
Securities Exchange Act of 1934 ("1934 Act") and a member of the National
Association of Securities Dealers, Inc. (the "NASD"); and
WHEREAS, MassMutual desires to engage MML DISTRIBUTORS, a broker-dealer
registered with the SEC under the 1934 Act and a member of the NASD, to act as
the principal underwriter ("Underwriter") of the Contracts, and to otherwise
perform certain duties and functions that are necessary and proper for the
distribution of the Contracts as required under applicable federal and state
securities laws and NASD regulations, and MML DISTRIBUTORS desires to act as
Underwriter for the sale of the Contracts and to assume such responsibilities;
34
<PAGE>
NOW, THEREFORE, the parties hereto agree as follows:
1.Underwriter. MassMutual hereby appoints MML DISTRIBUTORS as, and MML
DISTRIBUTORS agrees to serve as, Underwriter of the Contracts during the
term of this Agreement for purposes of federal and state securities laws.
MassMutual reserves the right, however, to refuse at any time or times to
sell any Contracts hereunder for any reason, and MassMutual maintains
ultimate responsibility for the sales of the Contracts.
MML DISTRIBUTORS shall use reasonable efforts to sell the Contracts but
does not agree hereby to sell any specific number of Contracts and shall be
free to act as underwriter of other securities. MML DISTRIBUTORS agrees to
offer the Contracts for sale in accordance with the prospectus then in
effect for the Contracts.
2.Services. MML DISTRIBUTORS agrees, on behalf of MassMutual and the Separate
Account, and in its capacity as Underwriter, to undertake at its own
expense except as otherwise provided herein, to provide certain sales,
administrative and supervisory services relative to the Contracts as
described below, and otherwise to perform all duties that are necessary and
proper for the distribution of the Contracts as required under applicable
federal and state securities laws and NASD regulations.
3.Selling Group. MML DISTRIBUTORS may enter into sales agreements for the
sale of the Contracts with independent broker-dealer firms ("Independent
Brokers") whose registered representatives have been or shall be licensed
and appointed as life insurance agents of MassMutual. All such agreements
shall be in a form agreed to by MassMutual. All such agreements shall
provide that the Independent Brokers must assume full responsibility for
continued compliance by itself and its associated persons with the NASD
Rules of Fair Practice (the "Rules") and all applicable federal and state
securities and insurance laws. All associated persons of such Independent
Brokers soliciting applications for the Contracts shall be duly and
appropriately licensed and appointed for the sale of the Contracts under
the Rules and applicable federal and state securities and insurance laws.
4.Compliance and Supervision. All persons who are engaged directly or
indirectly in the operations of MML DISTRIBUTORS and MassMutual in
connection with the offer or sale of the Contracts shall be considered a
"person associated" with MML DISTRIBUTORS as defined in Section 3(a)(18) of
the 1934 Act. MML DISTRIBUTORS shall have full responsibility for the
securities activities of each such person as contemplated by Section 15 of
the 1934 Act.
MML DISTRIBUTORS shall be fully responsible for carrying out all
compliance, supervisory and other obligations hereunder with respect to the
activities of its registered representatives as required by the Rules and
applicable federal and state securities laws. Without limiting the
generality of the foregoing, MML DISTRIBUTORS agrees that it shall be fully
responsible for:
(a) ensuring that no representative of MML DISTRIBUTORS shall offer
or sell the Contracts until such person is appropriately
licensed, registered, or otherwise qualified to offer and sell
such Contracts under the federal securities laws and any
applicable securities laws of each state or other jurisdiction in
which such Contracts may be lawfully sold, in which MassMutual is
licensed to sell the Contracts, and in which such person shall
offer or sell the Contracts; and
(b) training and supervising MassMutual's agents and brokers who are
also registered representatives of MML DISTRIBUTORS for purposes
of complying on a continuous basis with the Rules and with
federal and state securities laws applicable in connection with
the offering and sale of the Contracts. In this connection, MML
DISTRIBUTORS shall:
35
<PAGE>
(i) jointly conduct with MassMutual such training (including the
preparation and utilization of training materials) as in the
opinion of MML DISTRIBUTORS and MassMutual is necessary to
accomplish the purposes of this Agreement;
(ii) establish and implement reasonable written procedures for
supervision of sales practices of registered representatives of
MML DISTRIBUTORS who sell the Contracts;
(iii) provide a sufficient number of registered principals and an
adequately staffed compliance department to carry out the
responsibilities as set forth herein;
(iv) take reasonable steps to ensure that MassMutual agents and
brokers who are also registered representatives of MML
DISTRIBUTORS recommend the purchase of the Contracts only upon
reasonable grounds to believe that the purchase of the Contracts
is suitable for such applicant; and
(v) impose disciplinary measures on agents of MassMutual who are
also registered representatives of MML DISTRIBUTORS as required.
The parties hereto recognize that any registered representative of MML
DISTRIBUTORS or Independent Broker selling the Contracts as
contemplated by this Agreement shall also be acting as an insurance
agent of MassMutual or as an insurance broker, and that the rights of
MML DISTRIBUTORS and Independent Broker to supervise such persons
shall be limited to the extent specifically described herein or
required under applicable federal or state securities laws or NASD
regulations.
5. Registration and Qualification of Contracts. MassMutual has prepared or
caused to be prepared a registration statement describing the Contracts,
together with exhibits thereto (hereinafter referred to as the
"Registration Statement"). The Registration Statement includes a prospectus
(the "Prospectus") for the Contracts.
MassMutual agrees to execute such papers and to do such acts and things as
shall from time-to-time be reasonably requested by MML DISTRIBUTORS for the
purpose of qualifying and maintaining qualification of the Contracts for
sale under applicable state law and for maintaining the registration of the
Separate Account and interests therein under the 1933 Act and the 1940 Act,
to the end that there will be available for sale from time-to-time such
amounts of the Contracts as MML DISTRIBUTORS may reasonably request.
MassMutual shall advise MML DISTRIBUTORS promptly of any action of the SEC
or any authorities of any state or territory, of which it is aware,
affecting registration or qualification of the Separate Account, or rights
to offer the Contracts for sale.
If any event shall occur as a result of which it is necessary to amend or
supplement the Registration Statement in order to make the statements
therein, in light of the circumstances under which they were or are made,
true, complete or not misleading, MassMutual will forthwith prepare and
furnish to MML DISTRIBUTORS, without charge, amendments or supplements to
the Registration Statement sufficient to make the statements made in the
Registration Statement as so amended or supplemented true, complete and not
misleading in light of the circumstances under which they were made.
6. Representations of MassMutual. MassMutual represents and warrants to MML
DISTRIBUTORS and to the Independent Brokers as follows:
(a) MassMutual is an insurance company duly organized under the laws of
the Commonwealth of Massachusetts and is in good standing and is
authorized to conduct business under the laws of each state in which
the Contracts are sold, that the Separate Account was legally and
validly established as a segregated asset account under the Insurance
Code of Massachusetts, and that the
36
<PAGE>
Separate Account has been properly registered as a unit investment
trust in accordance with the provisions of the 1940 Act to serve as a
segregated investment account for the Contracts.
(b) All persons that will be engaging in the offer or sale of the
Contracts will be authorized insurance agents of MassMutual.
(c) The Registration Statement does not and will not contain any
misstatements of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were or are
made, not materially misleading.
(d) MassMutual shall make available to MML DISTRIBUTORS copies of all
financial statements that MML DISTRIBUTORS reasonably requests for use
in connection with the offer and sale of the Contracts.
(e) No federal or state agency or bureau has issued an order preventing or
suspending the offer of the Contracts or the use of the Registration
Statement, or of any part thereof, with respect to the sale of the
Contracts.
(f) The offer and sale of the Contracts is not subject to registration, or
if necessary, is registered, under the Blue Sky laws of the states in
which the Contracts will be offered and sold.
(g) The Contracts are qualified for offer and sale under the applicable
state insurance laws in those states in which the Contracts shall be
offered for sale. In each state where such qualification is effected,
MassMutual shall file and make such statements or reports as are or
may be required by the laws of such state.
(h) This Agreement has been duly authorized, executed and delivered by
MassMutual and constitutes the valid and legally binding obligation of
MassMutual. Neither the execution and delivery of this Agreement by
MassMutual nor the consummation of the transactions contemplated
herein will result in a breach or violation of any provision of the
state insurance laws applicable to MassMutual, any judicial or
administrative orders in which it is named or any material agreement
or instrument to which it is a party or by which it is bound.
7. Representations of MML DISTRIBUTORS. MML DISTRIBUTORS represents and
warrants to MassMutual as follows:
(a) MML DISTRIBUTORS is duly registered as a broker-dealer under the 1934
Act and is a member in good standing of the NASD and, to the extent
necessary to perform the activities contemplated hereunder, is duly
registered, or otherwise qualified, under the applicable securities
laws of every state or other jurisdiction in which the Contracts are
available for sale.
(b) This Agreement has been duly authorized, executed and delivered by MML
DISTRIBUTORS and constitutes the valid and legally binding obligation
of MML DISTRIBUTORS. Neither the execution and delivery of this
Agreement by MML DISTRIBUTORS nor the consummation of the transactions
contemplated herein will result in a breach or violation of any
provision of the federal or state securities laws or the Rules,
applicable to MML DISTRIBUTORS, or any judicial or administrative
orders in which it is named or any material agreement or instrument to
which it is a party or by which it is bound.
(c) MML DISTRIBUTORS shall comply with the Rules and the securities laws
of any jurisdiction in which it sells, directly or indirectly, any
Contracts.
37
<PAGE>
8. Expenses. MML DISTRIBUTORS shall be responsible for all expenses incurred
in connection with its provision of services and the performance of its
obligations hereunder, except as otherwise provided herein.
MassMutual shall be responsible for all expenses of printing and
distributing the Prospectuses, and all other expenses of preparing,
printing and distributing all other sales literature or material for
use in connection with offering the Contracts for sale.
9. Sales Literature and Advertising. MML DISTRIBUTORS agrees to ensure that it
uses and distributes only the Prospectus, statements of additional
information, or other applicable and authorized sales literature then in
effect in selling the Contracts. MML DISTRIBUTORS is not authorized to give
any information or to make any representations concerning the Contracts
other than those contained in the current Registration Statement filed with
the SEC or in such sales literature as may be authorized by MassMutual.
MML DISTRIBUTORS agrees to make timely filings with the SEC, the NASD, and
such other regulatory authorities as may be required of any sales
literature or advertising materials relating to the Contracts and intended
for distribution to prospective investors. MassMutual shall review and
approve all advertising and sales literature concerning the Contracts
utilized by MML DISTRIBUTORS. MML DISTRIBUTORS also agrees to furnish to
MassMutual copies of all agreements and plans it intends to use in
connection with any sales of the Contracts.
10. Applications. All applications for Contracts shall be made on application
forms supplied by MassMutual, and shall be remitted by MML DISTRIBUTORS or
Independent Brokers promptly, together with such forms and any other
required documentation, directly to MassMutual at the address indicated on
such application or to such other address as MassMutual may, from time to
time, designate in writing. All applications are subject to acceptance or
rejection by MassMutual at its sole discretion.
11. Payments. All money payable in connection with any of the Contracts,
whether as premiums, purchase payments or otherwise, and whether paid by,
or on behalf of any applicant or Contract owner, is the property of
MassMutual and shall be transmitted immediately in accordance with the
administrative procedures of MassMutual without any deduction or offset for
any reason, including by example but not limitation, any deduction or
offset for compensation claimed by MML DISTRIBUTORS. Checks or money orders
as payment on any Contract shall be drawn to the order of "Massachusetts
Mutual Life Insurance Company." No cash payments shall be accepted by MML
DISTRIBUTORS in connection with the Contracts. Unless otherwise agreed to
by MassMutual in writing, neither MML DISTRIBUTORS nor any of MassMutual's
agents nor any broker shall have an interest in any surrender charges,
deductions or other fees payable to MassMutual as set forth herein.
12. Insurance Licenses. MassMutual shall apply for and maintain the proper
insurance licenses and appointments for each of the agents and brokers
selling the Contracts in all states or jurisdictions in which the Contracts
are offered for sale by such person. MassMutual reserves the right to
refuse to appoint any proposed agent or broker, and to terminate an agent
or broker once appointed. MassMutual agrees to be responsible for all
licensing or other fees required under pertinent state insurance laws to
properly authorize agents or brokers for the sale of the Contracts;
however, the foregoing shall not limit MassMutual's right to collect such
amount from any person or entity other than MML DISTRIBUTORS.
13. Agent/Broker Compensation. Commissions or other fees due all brokers and
agents in connection with the sale of Contracts shall be paid by
MassMutual, on behalf of MML DISTRIBUTORS, to the persons entitled thereto
in accordance with the applicable agreement between each such broker or
agent and MassMutual or a general agent thereof. MML DISTRIBUTORS shall
assist MassMutual in the payment of such amounts as MassMutual shall
reasonably request, provided that MML DISTRIBUTORS shall not be required to
perform any acts that would subject it to registration under the insurance
laws of any state.
38
<PAGE>
The responsibility of MML DISTRIBUTORS shall include the performance of all
activities by MML DISTRIBUTORS necessary in order that the payment of such
amounts fully complies with all applicable federal and state securities
laws. Unless applicable federal or state securities law shall require,
MassMutual retains the ultimate right to determine the commission rate paid
to its agents.
14. MML DISTRIBUTORS Compensation. As payment for its services hereunder, MML
DISTRIBUTORS shall receive an annual fee that has the following components:
(1) a fixed fee in the amount of $_____ per year, and (2) a variable fee in
the amount of ___ basis points (.000x) per year of new sales of the
Contracts. Payments shall commence and be made no later than December 31 of
the year in which a Contract is issued. The variable component of the fee
shall be paid to MML DISTRIBUTORS' affiliate, MML Insurance Agency, Inc.
("MMLIAI"). The fixed component shall be renegotiated annually commencing
in 1997. The last agreed-to amounts for each of these fees shall remain in
effect until the new fees are mutually agreed upon and are set forth in
schedules attached hereto.
15. Books and Records. MML DISTRIBUTORS and MassMutual shall each cause to be
maintained and preserved for the period prescribed such accounts, books,
and other documents as are required of it by the 1934 Act and any other
applicable laws and regulations. In particular, without limiting the
foregoing, MML DISTRIBUTORS shall cause all the books and records in
connection with the offer and sale of the Contracts by its registered
representatives to be maintained and preserved in conformity with the
requirements of Rules 17a-3 and 17a-4 under the 1934 Act, to the extent
that such requirements are applicable to the Contracts. The books,
accounts, and records of MML DISTRIBUTORS and MassMutual as to all
transactions hereunder shall be maintained so as to disclose clearly and
accurately the nature and details of the transactions. The payment of
premiums, purchase payments, commissions and other fees and payments in
connection with the Contracts by its registered representatives shall be
reflected on the books and records of MML DISTRIBUTORS as required under
applicable NASD regulations and federal and state securities laws
requirements.
MML DISTRIBUTORS and MassMutual, from time to time during the term of this
Agreement, shall divide the administrative responsibility for maintaining
and preserving the books, records and accounts kept in connection with the
Contracts; provided, however, in the case of books, records and accounts
kept pursuant to a requirement of applicable law or regulation, the
ultimate and legal responsibility for maintaining and preserving such
books, records and accounts shall be that of the party which is required to
maintain or preserve such books, records and accounts under the applicable
law or regulation, and such books, records and accounts shall be maintained
and preserved under the supervision of that party. MML DISTRIBUTORS and
MassMutual shall each cause the other to be furnished with such reports as
it may reasonably request for the purpose of meeting its reporting and
recordkeeping requirements under such regulations and laws, and under the
insurance laws of the Commonwealth of Massachusetts and any other
applicable states or jurisdictions.
MML DISTRIBUTORS and MassMutual each agree and understand that all
documents, reports, records, books, files and other materials required
under applicable Rules and federal and state securities laws shall be the
property of MML DISTRIBUTORS, unless such documents, reports, records,
books, files and other materials are required by applicable regulation or
law to be also maintained by MassMutual, in which case such material shall
be the joint property of MML DISTRIBUTORS and MassMutual. All other
documents, reports, records, books, files and other materials maintained
relative to this Agreement shall be the property of MassMutual. Upon
termination of this Agreement, all said material shall be returned to the
applicable party.
MML DISTRIBUTORS and MassMutual shall establish and maintain facilities and
procedures for the safekeeping of all books, accounts, records, files, and
other materials related to this Agreement. Such books, accounts, records,
files, and other materials shall remain confidential and shall not be
voluntarily disclosed to any other person or entity except as described
below in section 16.
39
<PAGE>
16. Availability of Records. MML DISTRIBUTORS and MassMutual shall each submit
to all regulatory and administrative bodies having jurisdiction over the
sales of the Contracts, present or future, any information, reports, or
other material that any such body by reason of this Agreement may request
or require pursuant to applicable laws or regulations. In particular,
without limiting the foregoing, MassMutual agrees that any books and
records it maintains pursuant to paragraph 15 of this Agreement which are
required to be maintained under Rule 17a-3 or 17a-4 of the 1934 Act shall
be subject to inspection by the SEC in accordance with Section 17(a) of the
1934 Act and Sections 30 and 31 of the 1940 Act.
17. Confirmations. MassMutual agrees to prepare and mail a confirmation for
each transaction in connection with the Contracts at or before the
completion thereof as required by the 1934 Act and applicable
interpretations thereof, including Rule 10b-10 thereunder. Each such
confirmation shall reflect the facts of the transaction, and the form
thereof will show that it is being sent on behalf of MML DISTRIBUTORS or
Independent Broker acting in the capacity of agent for MassMutual.
18. Indemnification. MassMutual shall indemnify MML DISTRIBUTORS, Independent
Brokers, their registered representatives, officers, directors, employees,
agents and controlling persons and hold such persons harmless, from and
against any and all losses, damages, liabilities, claims, demands,
judgments, settlements, costs and expenses of any nature whatsoever
(including reasonable attorneys' fees and disbursements) resulting or
arising out of or based upon an allegation or finding that: (i) the
Registration Statement or any application or other document or written
information provided by or on behalf of MassMutual includes any untrue
statement of a material fact or omits to state a material fact necessary to
make the statements therein, in light of the circumstances under which they
are made, not misleading, unless such statement or omission was made in
reliance upon, and in conformity with, written information furnished to
MassMutual by MML DISTRIBUTORS, Independent Brokers, or their registered
representatives specifically for use in the preparation thereof, or (ii)
there is a misrepresentation, breach of warranty or failure to fulfill any
covenant or warranty made or undertaken by MassMutual hereunder.
MML DISTRIBUTORS will indemnify MassMutual, its officers, directors,
employees, agents and controlling persons and hold such persons harmless,
from and against any and all losses, damages, liabilities, claims, demands,
judgments, settlements, costs and expenses of any nature whatsoever
(including reasonable attorneys' fees and disbursements) resulting or
arising out of or based upon an allegation or finding that: (i) MML
DISTRIBUTORS or its registered representatives offered or sold or engaged
in any activity relating to the offer and sale of the Contracts which was
in violation of any provision of the federal securities laws or, (ii) there
is a material misrepresentation, material breach of warranty or material
failure to fulfill any covenant or warranty made or undertaken by MML
DISTRIBUTORS hereunder.
Promptly after receipt by an indemnified party under this paragraph 18 of
notice of the commencement of any action by a third party, such indemnified
party will, if a claim in respect thereof is to be made against the
indemnifying party under this paragraph 18, notify the indemnifying party
of the commencement thereof; but the omission to notify the indemnifying
party will not relieve the indemnifying party from liability which the
indemnifying party may have to any indemnified party otherwise than under
this paragraph. In case any such action is brought against any indemnified
party, and it notifies the indemnifying party of the commencement thereof,
the indemnifying party will be entitled to participate therein and, to the
extent that it may wish, to assume the defense thereof, with counsel
satisfactory to such indemnified party, and after notice from the
indemnifying party to such indemnified party of its election to assume the
defense thereof, the indemnifying party will not be liable to such
indemnified party under this paragraph for any legal or other expenses
subsequently incurred by such indemnified party in connection with the
defense thereof other than reasonable costs of investigation.
40
<PAGE>
19. Independent Contractor. MML DISTRIBUTORS shall be an independent
contractor. MML DISTRIBUTORS is responsible for its own conduct and the
employment, control and conduct of its agents and employees and for injury
to such agents or employees or to others through its agents or employees.
MML DISTRIBUTORS assumes full responsibility for its agents and employees
under applicable statutes and agrees to pay all employer taxes thereunder.
20. Termination. Subject to termination as hereinafter provided, this Agreement
shall remain in full force and effect for the initial term of the
Agreement, which shall be for a two year period commencing on the date
first above written, and this Agreement shall continue in full force and
effect from year to year thereafter, until terminated as herein provided.
This Agreement may be terminated by either party hereto upon 30 days
written notice to the other party, or at any time upon the mutual written
consent of the parties hereto. This Agreement shall automatically be
terminated in the event of its assignment. Subject to MassMutual's
approval, however, MML DISTRIBUTORS may delegate any duty or function
assigned to it in this agreement provided that such delegation is
permissible under applicable law. Upon termination of this Agreement, all
authorizations, rights and obligations shall cease except the obligations
to settle accounts hereunder, including the settlement of monies due in
connection with the Contracts in effect at the time of termination or
issued pursuant to applications received by MassMutual prior to
termination.
21. Interpretation. This Agreement shall be subject to the provisions of the
1934 Act and the rules, regulations, and rulings thereunder and of the
NASD, from time to time in effect, and the terms hereof shall be
interpreted and construed in accordance therewith. If any provision of this
Agreement shall be held or made invalid by a court decision, statute, rule,
or otherwise, the remainder of this Agreement shall not be affected
thereby. This Agreement shall be interpreted in accordance with the laws of
the Commonwealth of Massachusetts.
22. Non-exclusivity. The services of MML DISTRIBUTORS and MassMutual to the
Separate Account hereunder are not to be deemed exclusive and MML
DISTRIBUTORS and MassMutual shall be free to render similar services to
others so long as their services hereunder are not impaired or interfered
with hereby.
23. Amendment. This Agreement constitutes the entire Agreement between the
parties hereto and may not be modified except in a written instrument
executed by all parties hereto.
24. Interests in and of MML DISTRIBUTORS. It is understood that any of the
policyholders, directors, officers, employees and agents of MassMutual may
be a shareholder, director, officer, employee, or agent of, or be otherwise
interested in, MML DISTRIBUTORS, any affiliated person of MML DISTRIBUTORS,
any organization in which MML DISTRIBUTORS may have an interest, or any
organization which may have an interest in MML DISTRIBUTORS; that MML
DISTRIBUTORS, any such affiliated person or any such organization may have
an interest in MassMutual; and that the existence of any such dual interest
shall not affect the validity hereof or of any transaction hereunder except
as otherwise provided in the Charter, Articles of Incorporation, or By-Laws
of MassMutual and MML DISTRIBUTORS, respectively, or by specific provision
of applicable law.
41
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be signed by their respective officials thereunto duly authorized and
seals to be affixed, as of the day and year first above written.
ATTEST: MASSACHUSETTS MUTUAL LIFE
INSURANCE COMPANY, on its behalf
and on behalf of _______________
SEPARATE ACCOUNT
By:
------------------------------
ATTEST: MML DISTRIBUTORS, LLC
By:
-----------------------------
42
<PAGE>
EXHIBIT 9
REPRESENTATION BY REGISTRANT'S COUNSEL
As attorney to the Registrant, I, Richard M. Howe, have reviewed this
Post-Effective Amendment No. 7 to Registration Statement No. 33-45122, and
represent, pursuant to the requirement of paragraph (e) of Rule 485 under the
Securities Act of 1933, that this Amendment does not contain disclosures which
would render it ineligible to become effective pursuant to paragraph (b) of said
Rule 485.
/s/Richard M. Howe
Richard M. Howe
2nd VP and Associates General Counsel
Massachusetts Mutual Life Insurance Company
43
<PAGE>
Exhibit 10i
CONSENT OF INDEPENDENT ACCOUNTANTS
----------------------------------
To the Board of Directors of
C.M. Life Insurance Company
We consent to the inclusion in Post-Effective Amendment No. 7 to the
Registration Statement of Panorama Plus Separate Account on Form N-4
(Registration No. 33-45122), of our report, which includes explanatory
paragraphs relating to the use of statutory accounting practices, which
practices are not considered to be in accordance with generally accepted
accounting principles, dated February 7, 1997 on our audit of the financial
statements of C.M. Life Insurance Company, and our report dated March 14, 1997
on our audit of Panorama Plus Separate Account. We also consent to the reference
to our firm under the caption "Financial Statements."
Coopers & Lybrand L.L.P.
April 25, 1997
45
<PAGE>
Exhibit 10ii
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
-----------------------------------------
As independent public accountants, we hereby consent to the use of our report
(and to all references to our Firm) included in or made a part of this
registration statement for Panorama Plus Separate Account of C.M. Life Insurance
Company.
ARTHUR ANDERSEN LLP
Hartford, Connecticut
April 25, 1997
46
<PAGE>
Exhibit 10iii
POWER OF ATTORNEY
C.M. LIFE SEPARATE INVESTMENT ACCOUNTS
--------------------------------------
The Undersigned, Lawrence V. Burkett, Jr., President, Chief Executive Officer
and member of the Board of Directors of C.M. Life Insurance Company ("CM Life"),
does hereby constitute and appoint Thomas F. English, Richard M. Howe, and
Michael Berenson, and each of them individually, as his true and lawful
attorneys and agents.
The attorneys and agents shall have full power of substitution and to take any
and all action and execute any and all instruments on the Undersigned's behalf
as President, Chief Executive Officer and member of the Board of Directors of CM
Life that said attorneys and agents may deem necessary or advisable to enable CM
Life to comply with the Securities Act of 1933, as amended (the "1933 Act"), the
Investment Company Act of 1940, as amended (the "1940 Act"), and any rules,
regulations, orders or other requirements of the Securities and Exchange
Commission (the "Commission") thereunder. This power of attorney applies to the
registration, under the 1933 Act and the 1940 Act, of shares of beneficial
interest of CM Life separate investment accounts (the "CM Life Separate
Accounts"). This power of attorney authorizes such attorneys and agents to sign
the Undersigned's name on his behalf as President, Chief Executive Officer and
member of Board of Directors of CM Life to the Registration Statements and to
any instruments or documents filed or to be filed with the Commission under the
1933 Act and the 1940 Act in connection with such Registration Statements,
including any and all amendments to such statements, documents or instruments of
any CM Life Separate Account, including but not limited to those listed below.
Panorama Plus Separate Account
C.M. Multi-Account A
C.M. Life Variable Life Separate Account I
The Undersigned hereby ratifies and confirms all that said attorneys and agents
shall do or cause to be done by virtue hereof.
IN WITNESS WHEREOF the Undersigned has set his hand this 26th day of
February, 1997.
/s/ Lawrence V. Burkett, Jr.
- ------------------------------------------
Lawrence V. Burkett, Jr. Witness
President, Chief Executive Officer
and Member, Board of Directors
47
<PAGE>
POWER OF ATTORNEY
C.M. LIFE SEPARATE INVESTMENT ACCOUNTS
--------------------------------------
The Undersigned, John B. Davies, member of the Board of Directors of C.M. Life
Insurance Company ("CM Life"), does hereby constitute and appoint Lawrence V.
Burkett, Jr., Thomas F. English, Richard M. Howe, and Michael Berenson, and each
of them individually, as his true and lawful attorneys and agents.
The attorneys and agents shall have full power of substitution and to take any
and all action and execute any and all instruments on the Undersigned's behalf
as member of the Board of Directors of CM Life that said attorneys and agents
may deem necessary or advisable to enable CM Life to comply with the Securities
Act of 1933, as amended (the "1933 Act"), the Investment Company Act of 1940, as
amended (the "1940 Act"), and any rules, regulations, orders or other
requirements of the Securities and Exchange Commission (the "Commission")
thereunder. This power of attorney applies to the registration, under the 1933
Act and the 1940 Act, of shares of beneficial interest of CM Life separate
investment accounts (the "CM Life Separate Accounts"). This power of attorney
authorizes such attorneys and agents to sign the Undersigned's name on his
behalf as member of Board of Directors of CM Life to the Registration Statements
and to any instruments or documents filed or to be filed with the Commission
under the 1933 Act and the 1940 Act in connection with such Registration
Statements, including any and all amendments to such statements, documents or
instruments of any CM Life Separate Account, including but not limited to those
listed below.
Panorama Plus Separate Account
C.M. Multi-Account A
C.M. Life Variable Life Separate Account I
The Undersigned hereby ratifies and confirms all that said attorneys and agents
shall do or cause to be done by virtue hereof.
IN WITNESS WHEREOF the Undersigned has set his hand this 25th day of
February, 1997.
/s/ John B. Davies
- --------------------------------------
John B. Davies Witness
Member, Board of Directors
48
<PAGE>
POWER OF ATTORNEY
C.M. LIFE SEPARATE INVESTMENT ACCOUNTS
--------------------------------------
The Undersigned, Daniel J. Fitzgerald, member of the Board of Directors of C.M.
Life Insurance Company ("CM Life"), does hereby constitute and appoint Lawrence
V. Burkett, Jr., Thomas F. English, Richard M. Howe, and Michael Berenson, and
each of them individually, as his true and lawful attorneys and agents.
The attorneys and agents shall have full power of substitution and to take any
and all action and execute any and all instruments on the Undersigned's behalf
as member of the Board of Directors of CM Life that said attorneys and agents
may deem necessary or advisable to enable CM Life to comply with the Securities
Act of 1933, as amended (the "1933 Act"), the Investment Company Act of 1940, as
amended (the "1940 Act"), and any rules, regulations, orders or other
requirements of the Securities and Exchange Commission (the "Commission")
thereunder. This power of attorney applies to the registration, under the 1933
Act and the 1940 Act, of shares of beneficial interest of CM Life separate
investment accounts (the "CM Life Separate Accounts"). This power of attorney
authorizes such attorneys and agents to sign the Undersigned's name on his
behalf as member of Board of Directors of CM Life to the Registration Statements
and to any instruments or documents filed or to be filed with the Commission
under the 1933 Act and the 1940 Act in connection with such Registration
Statements, including any and all amendments to such statements, documents or
instruments of any CM Life Separate Account, including but not limited to those
listed below.
Panorama Plus Separate Account
C.M. Multi-Account A
C.M. Life Variable Life Separate Account I
The Undersigned hereby ratifies and confirms all that said attorneys and agents
shall do or cause to be done by virtue hereof.
IN WITNESS WHEREOF the Undersigned has set his hand this 25th day of
February, 1997.
/s/ Daniel J. Fitzgerald
- -------------------------------------
Daniel J. Fitzgerald Witness
Member, Board of Directors
49
<PAGE>
POWER OF ATTORNEY
C.M. LIFE SEPARATE INVESTMENT ACCOUNTS
--------------------------------------
The Undersigned, Stuart H. Reese, member of the Board of Directors of C.M. Life
Insurance Company ("CM Life"), does hereby constitute and appoint Lawrence V.
Burkett, Jr., Thomas F. English, Richard M. Howe, and Michael Berenson, and each
of them individually, as his true and lawful attorneys and agents.
The attorneys and agents shall have full power of substitution and to take any
and all action and execute any and all instruments on the Undersigned's behalf
as member of the Board of Directors of CM Life that said attorneys and agents
may deem necessary or advisable to enable CM Life to comply with the Securities
Act of 1933, as amended (the "1933 Act"), the Investment Company Act of 1940, as
amended (the "1940 Act"), and any rules, regulations, orders or other
requirements of the Securities and Exchange Commission (the "Commission")
thereunder. This power of attorney applies to the registration, under the 1933
Act and the 1940 Act, of shares of beneficial interest of CM Life separate
investment accounts (the "CM Life Separate Accounts"). This power of attorney
authorizes such attorneys and agents to sign the Undersigned's name on his
behalf as member of Board of Directors of CM Life to the Registration Statements
and to any instruments or documents filed or to be filed with the Commission
under the 1933 Act and the 1940 Act in connection with such Registration
Statements, including any and all amendments to such statements, documents or
instruments of any CM Life Separate Account, including but not limited to those
listed below.
Panorama Plus Separate Account
C.M. Multi-Account A
C.M. Life Variable Life Separate Account I
The Undersigned hereby ratifies and confirms all that said attorneys and agents
shall do or cause to be done by virtue hereof.
IN WITNESS WHEREOF the Undersigned has set his hand this 25th day of
February, 1997.
/s/ Stuart H. Reese
- --------------------------------
Stuart H. Reese Witness
Member, Board of Directors
50
<PAGE>
POWER OF ATTORNEY
C.M. LIFE SEPARATE INVESTMENT ACCOUNTS
--------------------------------------
The Undersigned, Ann Iseley, Treasurer of C.M. Life Insurance Company ("CM
Life"), does hereby constitute and appoint Lawrence V. Burkett, Jr., Thomas F.
English, Richard M. Howe, and Michael Berenson, and each of them individually,
as her true and lawful attorneys and agents.
The attorneys and agents shall have full power of substitution and to take any
and all action and execute any and all instruments on the Undersigned's behalf
as Treasurer of CM Life that said attorneys and agents may deem necessary or
advisable to enable CM Life to comply with the Securities Act of 1933, as
amended (the "1933 Act"), the Investment Company Act of 1940, as amended (the
"1940 Act"), and any rules, regulations, orders or other requirements of the
Securities and Exchange Commission (the "Commission") thereunder. This power of
attorney applies to the registration, under the 1933 Act and the 1940 Act, of
shares of beneficial interest of CM Life separate investment accounts (the "CM
Life Separate Accounts"). This power of attorney authorizes such attorneys and
agents to sign the Undersigned's name on her behalf as Treasurer of CM Life to
the Registration Statements and to any instruments or documents filed or to be
filed with the Commission under the 1933 Act and the 1940 Act in connection with
such Registration Statements, including any and all amendments to such
statements, documents or instruments of any CM Life Separate Account, including
but not limited to those listed below.
Panorama Plus Separate Account
C.M. Multi-Account A
C.M. Life Variable Life Separate Account I
The Undersigned hereby ratifies and confirms all that said attorneys and agents
shall do or cause to be done by virtue hereof.
IN WITNESS WHEREOF the Undersigned has set her hand this 25th day of
February, 1997.
/s/ Ann Iseley
- -----------------------------------
Ann Iseley Witness
Treasurer
51
<PAGE>
POWER OF ATTORNEY
C.M. LIFE SEPARATE INVESTMENT ACCOUNTS
--------------------------------------
The Undersigned, John Miller, Jr., Second Vice President and Comptroller of C.M.
Life Insurance Company ("CM Life"), does hereby constitute and appoint Lawrence
V. Burkett, Jr., Thomas F. English, Richard M. Howe, and Michael Berenson, and
each of them individually, as his true and lawful attorneys and agents.
The attorneys and agents shall have full power of substitution and to take any
and all action and execute any and all instruments on the Undersigned's behalf
as Second Vice President and Comptroller of CM Life that said attorneys and
agents may deem necessary or advisable to enable CM Life to comply with the
Securities Act of 1933, as amended (the "1933 Act"), the Investment Company Act
of 1940, as amended (the "1940 Act"), and any rules, regulations, orders or
other requirements of the Securities and Exchange Commission (the "Commission")
thereunder. This power of attorney applies to the registration, under the 1933
Act and the 1940 Act, of shares of beneficial interest of CM Life separate
investment accounts (the "CM Life Separate Accounts"). This power of attorney
authorizes such attorneys and agents to sign the Undersigned's name on his
behalf as Second Vice President and Comptroller of CM Life to the Registration
Statements and to any instruments or documents filed or to be filed with the
Commission under the 1933 Act and the 1940 Act in connection with such
Registration Statements, including any and all amendments to such statements,
documents or instruments of any CM Life Separate Account, including but not
limited to those listed below.
Panorama Plus Separate Account
C.M. Multi-Account A
C.M. Life Variable Life Separate Account I
The Undersigned hereby ratifies and confirms all that said attorneys and agents
shall do or cause to be done by virtue hereof.
IN WITNESS WHEREOF the Undersigned has set his hand this 26th day of
February, 1997.
/s/ John Miller, Jr.
- ------------------------------------
John Miller, Jr. Witness
Second Vice President
and Comptroller
52
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 609,992,739
<INVESTMENTS-AT-VALUE> 699,524,018
<RECEIVABLES> 18,797
<ASSETS-OTHER> 566,635
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 700,109,450
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 327,521
<TOTAL-LIABILITIES> 327,521
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 0
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 699,781,929
<DIVIDEND-INCOME> 10,250,632
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> 7,093,705
<NET-INVESTMENT-INCOME> 3,156,927
<REALIZED-GAINS-CURRENT> 1,429,336
<APPREC-INCREASE-CURRENT> 60,539,931
<NET-CHANGE-FROM-OPS> 65,126,194
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 0
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 170,354,088
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 632,973,844
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
