<PAGE> 1
As filed with the Securities and Exchange Commission on February 28, 2000.
Registration No. 333-61283
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
POST-EFFECTIVE AMENDMENT NO. 2
THE MANUFACTURERS LIFE INSURANCE COMPANY OF NEW YORK
SEPARATE ACCOUNT A
(Exact name of Registrant)
THE MANUFACTURERS LIFE INSURANCE COMPANY OF NEW YORK
(Name of Depositor)
100 Summit Lake Drive, Second Floor
Valhalla, New York 10595
(Address of Depositor's Principal Executive Offices)
(914) 773-0708
(Depositor's Telephone Number Including Area Code)
<TABLE>
<S> <C>
James D. Gallagher, President Copy to:
The Manufacturers Life Insurance J. Sumner Jones, Esq.
Company of New York Jones & Blouch, LLP
100 Summit Lake Drive 1025 Thomas Jefferson Street, N.W.
Valhalla, NY 10595 Washington, DC 20007
(Name and Address of Agent for Service)
</TABLE>
It is proposed that this filing will become effective:
___ immediately upon filing pursuant to paragraph (b) of Rule 485
___ on [date] pursuant to paragraph (b)(i) of Rule 485
___ 60 days after filing pursuant to paragraph (a) of Rule 485
_X_ on May 1, 2000 pursuant to paragraph (a) of Rule 485
If appropriate check the following box:
___ this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
<PAGE> 2
THE MANUFACTURERS LIFE INSURANCE COMPANY OF NEW YORK
CROSS REFERENCE TO ITEMS REQUIRED BY FORM N-4
<TABLE>
<CAPTION>
N-4 Item
Part A Caption in Prospectus
- ------ ---------------------
<S> <C>
1....... Cover Page
2....... Special Terms
3....... Summary
4....... Performance Data; Financial Statements
5....... General Information about Us, The Variable Account and The Trust
6....... Charges and Deductions; Administration Fees; Distribution Fee;
Mortality and Expense Risk Charge; Taxes
7....... Accumulation Period Provisions; Our Approval; Purchase
Payments; Accumulation Units; Net Investment Factor; Transfers
Among Investment Options; Special Transfer Services - Dollar
Cost Averaging; Asset Rebalancing Program; Withdrawals; Special
Withdrawal Services - the Income Plan; Contract Owner
Inquiries; Other Contract Provisions; Ownership; Beneficiary;
Modification
8....... Pay-out Period Provisions; General; Annuity Options;
Determination of Amount of the First Variable Annuity Payment;
Annuity Units and the Determination of Subsequent Variable
Annuity Payments; Transfers During Pay-out Period
9....... Accumulation Period Provisions; Death Benefit During
Accumulation Period; Pay-out Period Provisions; Death Benefit
During Pay-out Period
10...... Accumulation Period Provisions; Purchase Payments; Accumulation
Units; Value of Accumulation Units; Net Investment Factor;
Distribution of Contracts
11...... Withdrawals; Accumulation Period Provisions; Purchase Payments;
Other Contract Provisions; Right to Review Contract
12...... Federal Tax Matters; Introduction; Our Tax Status; Taxation of
Annuities in General; Qualified Retirement Plans
13...... Legal Proceedings
14...... Statement of Additional Information - Table of Contents
</TABLE>
<TABLE>
<CAPTION>
Caption in Statement of
Part B Additional Information
- ------ -----------------------
<S> <C>
15...... Cover Page
16...... Table of Contents
17...... General History and Information
18...... Services-Accountants; Services-Servicing Agent
19...... Not Applicable
20...... Services - Principal Underwriter
21...... Performance Data
22...... Not Applicable
23...... Financial Statements
</TABLE>
<PAGE> 3
PART A
INFORMATION REQUIRED IN A PROSPECTUS
<PAGE> 4
<TABLE>
<S> <C>
HOME OFFICE ANNUITY SERVICE OFFICE MAILING ADDRESS
100 Summit Lake Drive, Second Floor Post Office Box 9013
Valhalla, New York 10595 Boston, Massachusetts 02205-9013
</TABLE>
THE MANUFACTURERS LIFE INSURANCE COMPANY
OF NEW YORK SEPARATE ACCOUNT A
OF
THE MANUFACTURERS LIFE INSURANCE COMPANY OF NEW YORK
SINGLE PAYMENT INDIVIDUAL DEFERRED
COMBINATION FIXED AND VARIABLE ANNUITY CONTRACT
NON-PARTICIPATING
This Prospectus describes an annuity contract (the "CONTRACT") issued
by The Manufacturers Life Insurance Company of New York ("WE" or "US"). The
contract is a single purchase payment, individual, deferred, non-participating,
combination fixed and variable annuity contract.
- Contract values and annuity benefit payments are based upon
forty investment options. Thirty-eight options are variable
and two are fixed account options.
- Contract values (other than those allocated to one of the
fixed accounts) and variable annuity benefit payments will
vary according to the investment performance of the
sub-accounts of one of our separate accounts, The
Manufacturers Life Insurance Company of New York Separate
Account A (the "VARIABLE ACCOUNT"). Contract values may be
allocated to, and transferred among, one or more of those
sub-accounts.
- Each sub-account's assets are invested in a corresponding
portfolio of a mutual fund, Manufacturers Investment Trust
(the "TRUST"). We will provide the contract owner ("YOU") a
prospectus for the Trust with this Prospectus.
- SHARES OF THE TRUST ARE NOT DEPOSITS OR OBLIGATIONS OF, OR
GUARANTEED OR ENDORSED BY, ANY BANK, AND THE SHARES ARE NOT
FEDERALLY INSURED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER AGENCY.
- Except as specifically noted here and under the caption "FIXED
ACCOUNT INVESTMENT OPTIONS" below, this Prospectus describes
only the variable portion of the contract.
- Special terms are defined in a glossary in Appendix A.
PLEASE READ THIS PROSPECTUS CAREFULLY AND KEEP IT FOR FUTURE REFERENCE. IT
CONTAINS INFORMATION ABOUT THE VARIABLE ACCOUNT AND THE VARIABLE PORTION OF THE
CONTRACT THAT YOU SHOULD KNOW BEFORE INVESTING.
THE CONTRACTS HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION ("SEC"). NEITHER THE SEC NOR ANY STATE HAS DETERMINED
WHETHER THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
<PAGE> 5
- - ADDITIONAL INFORMATION about the contract and the Variable Account is
contained in a Statement of Additional Information, dated the same date
as this Prospectus, which has been filed with the SEC and is
incorporated herein by reference. The Statement of Additional
Information is available without charge upon request by writing us at
the address on the front cover or by telephoning (877) 391-3748.
- - The SEC maintains a Web site (http://www.sec.gov) that contains the
Statement of Additional Information and other information about us, the
contracts and the Variable Account.
STATEMENT OF ADDITIONAL INFORMATION
TABLE OF CONTENTS
<TABLE>
<S> <C>
General Information and History 3
Performance Data ............... 3
State Premium Taxes ............ 10
Services
Independent Auditors .. 10
Servicing Agent ....... 11
Principal Underwriter . 11
Appendix A - State Premium Taxes 12
Financial Statements ........... 13
</TABLE>
The date of this Prospectus is May 1, 2000
NYVISION.PRO5/00
<PAGE> 6
TABLE OF CONTENTS
<TABLE>
<S> <C>
SUMMARY .................................................................. 4
GENERAL INFORMATION ABOUT US, THE VARIABLE ACCOUNT AND THE TRUST ......... 8
The Manufacturers Life Insurance Company of
New York ............................................................ 8
The Variable Account ................................................ 8
The Trust ........................................................... 9
DESCRIPTION OF THE CONTRACT .............................................. 13
ACCUMULATION PERIOD PROVISIONS ........................................ 13
Purchase Payments ................................................... 13
Accumulation Units .................................................. 14
Value of Accumulation Units ......................................... 14
Net Investment Factor ............................................... 14
Transfers Among Investment Options .................................. 15
Maximum Number of Investment Options ................................ 15
Telephone Transactions .............................................. 15
Special Transfer Services - Dollar Cost Averaging ................... 15
Asset Rebalancing Program ........................................... 15
Withdrawals ......................................................... 16
Special Withdrawal Services - the Income Plan ....................... 17
Death Benefit During Accumulation Period ............................ 18
PAY-OUT PERIOD PROVISIONS ............................................. 19
General ............................................................. 19
Annuity Options ..................................................... 20
Determination of Amount of the First Variable
Annuity Payment ..................................................... 21
Annuity Units and the Determination of
Subsequent Variable Annuity Payments .............................. 21
Transfers During Pay-out Period ..................................... 22
Death Benefit During Pay-out Period ................................. 22
OTHER CONTRACT PROVISIONS ............................................. 22
Right to Review Contract ............................................ 22
Ownership ........................................................... 23
Annuitant ........................................................... 23
Beneficiary ......................................................... 23
Modification ........................................................ 23
Our Approval ........................................................ 23
Misstatement and Proof of Age, Sex or Survival ...................... 24
FIXED ACCOUNT INVESTMENT OPTIONS .................................... 24
CHARGES AND DEDUCTIONS ................................................... 25
Administration Fees ................................................. 25
Distribution Fee .................................................... 26
Mortality and Expense Risk Charge ................................... 26
Taxes ............................................................... 26
Expenses of Distributing Contracts .................................. 26
FEDERAL TAX MATTERS ...................................................... 26
INTRODUCTION .......................................................... 26
OUR TAX STATUS ........................................................ 27
TAXATION OF ANNUITIES IN GENERAL ...................................... 27
Tax Deferral During Accumulation Period ............................. 27
Taxation of Partial and Full Withdrawals ............................ 28
Taxation of Annuity Benefit Payments ................................ 29
Taxation of Death Benefit Proceeds .................................. 29
Penalty Tax on Premature Distributions .............................. 30
Aggregation of Contracts ............................................ 30
QUALIFIED RETIREMENT PLANS ............................................ 30
Direct Rollovers .................................................... 31
Loans ............................................................... 17
FEDERAL INCOME TAX WITHHOLDING ........................................ 32
GENERAL MATTERS .......................................................... 32
Performance Data .................................................... 32
Asset Allocation and Timing Services ................................ 32
Distribution of Contracts ........................................... 33
Contract Owner Inquiries ............................................ 33
Confirmation Statements ............................................. 33
Legal Proceedings ................................................... 33
Year 2000 Issues .................................................... 33
Cancellation of Contract ............................................ 34
Voting Interest ..................................................... 34
APPENDIX A: SPECIAL TERMS ............................................... A-1
APPENDIX B: TABLE OF ACCUMULATION UNIT VALUES
RELATING TO THE CONTRACT ............................................ B-1
APPENDIX C: QUALIFIED PLAN TYPES ......................................... C-1
</TABLE>
<PAGE> 7
SUMMARY
OVERVIEW OF THE CONTRACT. Under the contract, you make a single payment to us
(the "ACCUMULATION PERIOD") and then later, beginning on the "MATURITY DATE" we
make one or more annuity benefit payments to you (the "PAY-OUT PERIOD").
Contract values during the accumulation period and the amounts of annuity
benefit payments during the pay-out period may either be variable or fixed,
depending upon the investment option(s) you select. You may use the contract to
fund either a non-qualified or tax-qualified retirement plan.
When you purchase a variable annuity for any tax-qualified retirement plan, the
variable annuity does not provide any additional tax deferred treatment of
earnings beyond the treatment provided by the plan. Consequently, you should
purchase a variable annuity for a tax-qualified plan only on the basis of other
benefits offered by the variable annuity. These benefits may include lifetime
income payments, family protection through the death benefit, and guaranteed
fees.
PURCHASE PAYMENT LIMITS. The minimum purchase payment is $25,000. Additional
purchase payments are not permitted. For purchase payments in excess of
$1,000,000 you must obtain our approval in order to purchase the contract.
INVESTMENT OPTIONS. During the accumulation period, contract values may be
allocated among up to seventeen of the available investment options. Currently,
thirty-eight Variable Account investment options and two fixed account
investment options are available under the contract. Each of the thirty-eight
Variable Account investment options is a sub-account of the Variable Account
that invests in a corresponding portfolio of the Trust. A full description of
each Trust portfolio is in the accompanying Prospectus of the Trust. Your
contract value during the accumulation period and the amounts of annuity benefit
payments will depend upon the investment performance of the Trust portfolio
underlying each sub-account of the Variable Account you select and/or upon the
interest we credit on each fixed account option you select. Subject to certain
regulatory limitations, we may elect to add, subtract or substitute investment
options.
TRANSFERS. During the accumulation period, you may transfer your contract values
among any of the investment options. During the pay-out period, you may transfer
your allocations among the Variable Account investment options, but transfers
from Variable Account options to fixed account options or from fixed account
options to Variable Account options are not permitted.
WITHDRAWALS. During the accumulation period, you may withdraw all or a portion
of your contract value. The amount you withdraw from any investment account must
be at least $300 or, if less, your entire balance in that investment account. If
a partial withdrawal plus any applicable withdrawal charge would reduce your
contract value to less than $300, we will treat your withdrawal request as a
request to withdraw all of your contract value. A withdrawal charge and an
administration fee may apply to your withdrawal. A withdrawal may be subject to
income tax and a 10% penalty tax. A systematic withdrawal plan service is
available under the contract.
CONFIRMATION STATEMENTS. We will send you confirmation statements for certain
transactions in your account. You should carefully review these statements to
verify their accuracy. You should immediately report any mistakes to our Annuity
Service Office. If you fail to notify our Annuity Service Office of any mistake
within 60 days of the mailing of the confirmation statement, you will be deemed
to have ratified the transaction.
DEATH BENEFITS. We will pay the death benefit described below to your
BENEFICIARY if you die during the accumulation period. If a contract is owned by
more than one person, then the surviving contract owner will be deemed the
beneficiary of the deceased contract owner. No death benefit is payable on the
death of any ANNUITANT (a natural person or persons whose life is used to
determine the duration of ANNUITY BENEFIT PAYMENTS involving life
contingencies), except that if any contract owner is not a natural person, the
death of any annuitant will be treated as the death of an owner. The amount of
the death benefit will be calculated as of the date on which our Annuity Service
Office receives written notice and proof of death and all required claim forms.
The formula used to calculate the death benefit may vary according to the age(s)
of the contract owner(s) at the time the contract is issued and the age of the
contract owner who dies. If there are any unpaid loans (including unpaid
interest) under the contract, the death benefit equals the death benefit
calculated according to the applicable formula, minus the amount of the unpaid
loans. If the
4
<PAGE> 8
annuitant dies during the pay-out period and annuity benefit payment method
selected called for payments for a guaranteed period, we will make the remaining
guaranteed payments to the beneficiary.
ANNUITY BENEFIT PAYMENTS. We offer a variety of fixed and variable annuity
payment options. Periodic annuity benefit payments will begin on the "maturity
date" (the first day of the pay-out period). You select the maturity date, the
frequency of payment and the type of annuity benefit payment option.
TEN DAY REVIEW. You may cancel your contract by returning it to us within 10
days of receiving it.
TAXATION. Generally, all earnings on the underlying investments to be
tax-deferred until withdrawn or until annuity benefit payments begin. Normally,
a portion of each annuity benefit payment is taxable as ordinary income. Partial
and total withdrawals are taxable as ordinary income to the extent contract
value prior to the withdrawal exceeds the purchase payments you have made, minus
any prior withdrawals that were not taxable. A penalty tax may apply to
withdrawals prior to age 59-1/2.
CHARGES AND DEDUCTIONS. The following Table and Example are designed to assist
you in understanding the various costs and expenses related to the contract. The
table reflects expenses of the Variable Account and the underlying portfolios of
the Trust. In addition to the items listed in the following table, premium taxes
may be applicable to certain contracts and we reserve the right to impose an
annual $30 per contract administration fee on contracts where the contract value
is less than $10,000 as a result of a partial withdrawal. The items listed under
"Contract Owner Transaction Expenses" and "Separate Account Annual Expenses" are
more completely described in this Prospectus beginning at page __. The items
listed under "Trust Annual Expenses" are described in detail in the accompanying
Trust Prospectus.
CONTRACT OWNER TRANSACTION EXPENSES
Deferred sales load (withdrawal charge as percentage of purchase payments) NONE
SEPARATE ACCOUNT ANNUAL EXPENSES
(as a percentage of average account value)
<TABLE>
<S> <C>
Mortality and expense risk fees ....................................... 1.25%
Administration fee .................................................... 0.25%
Distribution fee ...................................................... 0.15%
Total Separate Account Annual Expenses ................................ 1.65%
</TABLE>
TRUST ANNUAL EXPENSES
(as a percentage of Trust average net assets for the fiscal year ended December
31 1999)
<TABLE>
<CAPTION>
TOTAL TRUST
OTHER EXPENSES ANNUAL EXPENSES
MANAGEMENT (AFTER EXPENSE (AFTER EXPENSE
TRUST PORTFOLIO FEES REIMBURSEMENT) REIMBURSEMENT)
- --------------- ---------- --------------- ---------------
<S> <C> <C> <C>
Pacific Rim Emerging Markets . 0.850% 0.260% 1.110%
Science & Technology ......... 1.100% 0.060% 1.160%
International Small Cap ...... 1.100% 0.270% 1.370%
Aggressive Growth ............ 1.000%(F) 0.130% 1.130%
Emerging Small Company ....... 1.050% 0.070% 1.120%
Small Company Blend .......... 1.050% 0.250%(A) 1.300%(E)
Mid Cap Growth ............... 0.950%(F) 0.070% 1.020%
Mid Cap Stock ................ 0.925% 0.100%(A) 1.025%(E)
Overseas ..................... 0.950% 0.260% 1.210%
International Stock .......... 1.050% 0.200% 1.250%
International Value .......... 1.000% 0.230%(A) 1.230%(E)
Mid Cap Blend ................ 0.850%(F) 0.060% 0.910%
Small Company Value .......... 1.050% 0.170% 1.220%
Global Equity ................ 0.900% 0.160% 1.060%
Growth ....................... 0.850% 0.050% 0.900%
</TABLE>
5
<PAGE> 9
<TABLE>
<S> <C> <C> <C>
Large Cap Growth ............. 0.875%(F) 0.100% 0.975%
Quantitative Equity .......... 0.700% 0.060% 0.760%
Blue Chip Growth ............. 0.875%(F) 0.050% 0.925%
Real Estate Securities ....... 0.700% 0.070% 0.770%
Value ........................ 0.800% 0.070% 0.870%
Growth & Income .............. 0.750% 0.050% 0.800%
U.S. Large Cap Value ......... 0.875% 0.070%(A) 0.945%(E)
Equity-Income ................ 0.875%(F) 0.060% 0.935%
Income & Value ............... 0.800%(F) 0.080% 0.880%
Balanced ..................... 0.800% 0.070% 0.870%
High Yield ................... 0.775% 0.065% 0.840%
Strategic Bond ............... 0.775% 0.095% 0.870%
Global Bond .................. 0.800% 0.180% 0.980%
Total Return ................. 0.775% 0.060%(A) 0.835%(E)
Investment Quality Bond ...... 0.650% 0.120% 0.770%
Diversified Bond ............. 0.750% 0.090% 0.840%
U.S. Government Securities ... 0.650% 0.070% 0.720%
Money Market ................. 0.500% 0.050% 0.550%
Lifestyle Aggressive 1000(D) . 0.075% 1.060%(B) 1.135%(C)
Lifestyle Growth 820(D) ...... 0.057% 0.990%(B) 1.047%(C)
Lifestyle Balanced 640(D) .... 0.057% 0.910%(B) 0.967%(C)
Lifestyle Moderate 460(D) .... 0.066% 0.860%(B) 0.926%(C)
Lifestyle Conservative 280(D) 0.075% 0.780%(B) 0.855%(C)
</TABLE>
(A) Based on estimates to be made during the current fiscal year.
(B) Reflects expenses of the Underlying Portfolios.
(C) The investment adviser to the Trust, Manufacturers Securities Services, LLC
("MSS" or the "Adviser") has voluntarily agreed to pay certain expenses of each
Lifestyle Trust (excluding the expenses of the Underlying Portfolios) as noted
below. This voluntary expense reimbursement may be terminated at any time. If
such expense reimbursement was not in effect, Total Trust Annual Expenses would
be 0.03% higher, except for the Lifestyle Growth 820 Trust and Lifestyle
Moderate 460 Trust, which would be 0.04% higher (based on current advisory fees
and the Other Expenses of the Lifestyle Trusts for the fiscal year ended
December 31, 1999) as noted in the chart below:
<TABLE>
<CAPTION>
MANAGEMENT OTHER TOTAL TRUST
TRUST PORTFOLIO FEES EXPENSES ANNUAL EXPENSES
- --------------- ---------- -------- ---------------
<S> <C> <C> <C>
Lifestyle Aggressive 1000 .......... 0.075% 1.090% 1.165%
Lifestyle Growth 820 ............... 0.057% 1.030% 1.087%
Lifestyle Balanced 640 ............. 0.057% 0.940% 0.997%
Lifestyle Moderate 460 ............. 0.066% 0.900% 0.966%
Lifestyle Conservative 280 ......... 0.075% 0.810% 0.885%
</TABLE>
If total expenses of a Lifestyle Trust (absent reimbursement) exceed 0.075%, the
Adviser will reduce the advisory fee or reimburse expenses of that Lifestyle
Trust by an amount such that total expenses of the Lifestyle Trust including the
advisory fee but excluding: (a) the expenses of the underlying portfolios, (b)
taxes, (c) portfolio brokerage, (d) interest, (e) litigation and (f)
indemnification expenses and other extraordinary expenses not incurred in the
ordinary course of the Trust's business, equal 0.075%. If the total expenses of
a Lifestyle Trust (absent reimbursement) are equal to or less then 0.075%, then
no expenses will be reimbursed by the Adviser.
(D) Each Lifestyle Trust will invest in shares of the Underlying Portfolios.
Therefore, each Lifestyle Trust will bear its pro rata share of the fees and
expenses incurred by the Underlying Portfolios in which it invests, and the
investment return of each Lifestyle Trust will be net of the Underlying
Portfolio expenses. Each Lifestyle Portfolio must bear its own expenses.
However, the Adviser is currently paying certain of these expenses as described
in footnote (C) above.
(E) Annualized - For the period May 1, 1999 (commencement of operations) to
December 31, 1999.
(F) Management Fees changed effective May 1, 1999. Fees shown are the current
management fees.
6
<PAGE> 10
EXAMPLE
You would pay the following expenses on a $1,000 investment, assuming 5% annual
return on assets, regardless of whether the contract owner annuitizes as
provided for in the contract, surrenders the contract at the end of the
applicable time period or does not surrender the contract at the end of the
applicable time period:
<TABLE>
<CAPTION>
TRUST PORTFOLIO 1 YEAR 3 YEARS 5 YEARS 10 YEARS
- --------------- ------ ------- ------- --------
<S> <C> <C> <C> <C>
Pacific Rim Emerging Markets ......... $28 $86 $146 $309
Science & Technology ................. 28 87 148 314
International Small Cap .............. 30 93 159 334
Aggressive Growth .................... 28 86 147 311
Emerging Small Company ............... 28 86 146 310
Small Company Blend .................. 30 91 155 327
Mid Cap Growth ....................... 27 83 141 300
Mid Cap Stock ........................ 27 83 142 301
Overseas ............................. 29 89 151 319
International Stock .................. 29 90 153 322
International Value .................. 29 89 152 320
Mid Cap Blend ........................ 26 80 136 290
Small Company Value .................. 29 89 151 319
Global Equity ........................ 27 84 143 304
Growth ............................... 26 79 136 289
Large Cap Growth ..................... 27 82 139 296
Quantitative Equity .................. 24 75 129 275
Blue Chip Growth ..................... 26 80 137 291
Real Estate Securities ............... 25 75 129 276
Value ................................ 26 78 134 286
Growth and Income .................... 25 76 131 279
U.S. Large Cap Value ................. 26 81 138 293
Equity-Income ........................ 26 80 137 292
Income & Value ....................... 26 79 135 287
Balanced ............................. 26 78 134 286
High Yield ........................... 25 78 133 283
Strategic Bond ....................... 26 78 134 286
Global Bond .......................... 27 82 140 296
Total Return ......................... 25 77 132 282
Investment Quality Bond .............. 25 75 129 276
Diversified Bond ..................... 25 78 133 283
U.S. Government Securities ........... 24 74 127 271
Money Market ......................... 22 69 118 253
Lifestyle Aggressive 1000 ............ 27 84 143 303
Lifestyle Growth 820 ................. 27 82 140 297
Lifestyle Balanced 640 ............... 26 80 136 290
Lifestyle Moderate 460 ............... 25 78 134 285
Lifestyle Conservative 280 ........... 25 76 130 277
</TABLE>
For purposes of presenting the foregoing Example, we have made certain
assumptions. We have assumed that there are no transfers or other transactions
and that the "Other Expenses" line item under "Trust Annual Expenses" will
remain the same. Those assumptions, (each of which is mandated by the SEC in an
attempt to provide prospective investors with standardized data with which to
compare various annuity contracts) do not take into account certain features of
the contract and prospective changes in the size of the Trust which may operate
to change the expenses borne by contract owners. CONSEQUENTLY, THE AMOUNTS
LISTED IN THE EXAMPLE ABOVE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR
FUTURE EXPENSES AND ACTUAL EXPENSES BORNE BY CONTRACT OWNERS MAY BE GREATER OR
LESSER THAN THOSE SHOWN.
A TABLE OF ACCUMULATION UNIT VALUES RELATING TO THE CONTRACT IS INCLUDED IN
APPENDIX B TO THIS PROSPECTUS.
7
<PAGE> 11
LOCATION OF FINANCIAL STATEMENTS OF REGISTRANT AND DEPOSITOR
Our financial statements and those of the Variable Account may be found
in the Statement of Additional Information.
GENERAL INFORMATION ABOUT US, THE VARIABLE ACCOUNT AND THE TRUST
We are an indirect subsidiary of MFC.
THE MANUFACTURERS LIFE INSURANCE COMPANY OF NEW YORK
We are a stock life insurance company organized under the laws of New
York on February 10, 1992. Our principal office is located at 100 Summit Lake
Drive, Second Floor Valhalla, New York 10595. We are a wholly-owned subsidiary
of The Manufacturers Life Insurance Company of North America ("MANULIFE NORTH
AMERICA"). Manulife North America is a stock life insurance company organized
under the laws of Delaware in 1979. Manulife North America's principal office is
located at 500 Boylston Street, Boston, Massachusetts 02116. The principal
business of Manulife North America is offering variable annuity contacts,
similar to those offered by us in New York, in 48 other states, the District of
Columbia and Puerto Rico. Our ultimate parent is Manulife Financial Corporation
("MFC") based in Toronto, Canada. MFC is the holding company of The
Manufacturers Life Insurance Company and its subsidiaries, collectively known as
Manulife Financial.
The Manufacturers Life Insurance Company of New York's financial
ratings are as follows:
A++ A.M. Best
Superior in financial strength; 1st category of 15
AAA Duff & Phelps
Highest in claims paying ability; 1st category of 18
AA+ Standard & Poor's
Very strong in financial strength; 2nd category of 21
These ratings, which are current as of the date of this prospectus and are
subject to change, are assigned as a measure of The Manufacturers Life Insurance
Company of New York's ability to honor the death benefit, fixed account
guarantees and life annuitization guarantees but not specifically to its
products, the performance (return) of these products, the value of any
investment in these products upon withdrawal or to individual securities held in
any portfolio.
The Variable Account is one of our separate accounts that invests the contract
values you allocate to it in the Trust portfolio(s) you select.
THE VARIABLE ACCOUNT
We established the Variable Account on March 4, 1992. The income, gains
and losses, whether or not realized, from assets of the Variable Account are
credited to or charged against the Variable Account without regard to our other
income, gains or losses. Nevertheless, all obligations arising under the
contracts are our general corporate obligations. Assets of the Variable Account
may not be charged with liabilities arising out of any of our other business.
The Variable Account is registered with the SEC under the Investment
Company Act of 1940, as amended (the "1940 Act") as a unit investment trust. A
unit investment trust is a type of investment company which invests its assets
in specified securities, such as the shares of one or more investment companies.
Registration under the 1940 Act does not involve supervision by the SEC of the
management or investment policies or practices of the Variable Account. If we
determine that it would be in the best interests of persons having voting rights
under the contracts, the Variable Account may be operated as a management
company under the 1940 Act or it may be deregistered if 1940 Act registration
were no longer required.
The Variable Account currently has thirty-eight sub-accounts. We
reserve the right, subject to prior approval of the New York Superintendent of
Insurance and compliance with applicable law, to add other sub-accounts,
eliminate existing sub-accounts, combine sub-accounts or transfer assets in one
sub-account to another sub-account that we, or an affiliated company, may
establish.
8
<PAGE> 12
The Trust is a mutual fund in which the Variable Account invests.
THE TRUST
The assets of each sub-account of the Variable Account are invested in
shares of a corresponding investment portfolio of the Trust. The Trust is
registered under the 1940 Act as an open-end management investment company. Each
of the portfolios is diversified for purposes of the 1940 Act, except for the
Global Bond Trust and the five Lifestyle Trusts which are non-diversified. The
Trust receives investment advisory services from MSS, the successor to NASL
Financial Services, Inc.
The Trust currently has sixteen subadvisers who manage all of the
portfolios, one of which is Manufacturers Adviser Corporation ("MAC"). Both MSS
and MAC are affiliates of ours:
<TABLE>
<CAPTION>
SUBADVISER TRUST PORTFOLIOS MANAGED
- ---------- ------------------------
<S> <C>
A I M Capital Management, Inc. Aggressive Growth Trust
Mid Cap Growth Trust
AXA Rosenberg Investment Management LLC Small Company Value Trust
Capital Guardian Trust Company Small Company Blend Trust
U.S. Large Cap Value Trust
Income & Value Trust
Diversified Bond Trust
Fidelity Management Trust Company Overseas Trust
Mid Cap Blend Trust
Large Cap Growth Trust
Founders Asset Management LLC International Small Cap Trust
Balanced Trust
Franklin Advisers, Inc. Emerging Small Company Trust
Manufacturers Adviser Corporation Pacific Rim Emerging Markets Trust
Quantitative Equity Trust
Real Estate Securities Trust
Money Market Trust
Lifestyle Trusts(A)
Miller Anderson & Sherrerd, LLP Value Trust
High Yield Trust
Morgan Stanley Asset Management Inc. Global Equity Trust
Pacific Investment Management Company Global Bond Trust
Total Return Trust
Rowe Price-Fleming International, Inc. International Stock Trust
</TABLE>
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<PAGE> 13
<TABLE>
<CAPTION>
SUBADVISER TRUST PORTFOLIOS MANAGED
- ---------- ------------------------
<S> <C>
Salomon Brothers Asset Management Inc Strategic Bond Trust
U.S. Government Securities Trust
State Street Global Advisors Growth Trust
Lifestyle Trusts(A)
T. Rowe Price Associates, Inc. Science & Technology Trust
Blue Chip Growth Trust
Equity-Income Trust
Templeton Investment Counsel, Inc. International Value Trust
Wellington Management Company, LLP Mid Cap Stock Trust
Growth and Income Trust
Investment Quality Bond Trust
</TABLE>
(A) State Street Global Advisors provides subadvisory consulting services to
Manufacturers Adviser Corporation regarding management of the Lifestyle Trusts.
The following is a brief description of each portfolio:
The PACIFIC RIM EMERGING MARKETS TRUST seeks long-term growth of
capital by investing in a diversified portfolio that is comprised primarily of
common stocks and equity-related securities of corporations domiciled in
countries in the Pacific Rim region.
The SCIENCE & TECHNOLOGY TRUST seeks long-term growth of capital.
Current income is incidental to the portfolio's objective.
The INTERNATIONAL SMALL CAP TRUST seeks long-term capital appreciation
by investing primarily in securities issued by foreign companies which have
total market capitalization or annual revenues of $1 billion or less. These
securities may represent companies in both established and emerging economies
throughout the world.
The AGGRESSIVE GROWTH TRUST seeks long-term capital appreciation by
investing the portfolio's asset principally in common stocks, convertible bonds,
convertible preferred stocks and warrants of companies which in the opinion of
the subadviser are expected to achieve earnings growth over time at a rate in
excess of 15% per year. Many of these companies are in the small and
medium-sized category.
The EMERGING SMALL COMPANY TRUST seeks long-term growth of capital by
investing, under normal market conditions, at least 65% of the portfolio's total
assets in common stock equity securities of companies with market
capitalizations that approximately match the range of capitalization of the
Russell 2000 Index ("small cap stocks") at the time of purchase.
The SMALL COMPANY BLEND TRUST seeks long-term growth of capital and
income by investing the portfolio's assets, under normal market conditions,
primarily in equity and equity-related securities of companies with market
capitalizations that approximately match the range of capitalization of the
Russell 2000 Index ("small cap stocks") at the time of purchase.
The MID CAP GROWTH TRUST seeks long-term capital appreciation by
investing the portfolio's assets principally in common stocks, with emphasis on
medium-sized and smaller emerging growth companies.
The MID CAP STOCK TRUST seeks long-term growth of capital by investing
primarily in equity securities of companies with market capitalizations that
approximately match the range of capitalization of the Wilshire Mid Cap 750
Index.
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<PAGE> 14
The OVERSEAS TRUST seeks growth of capital by investing, under normal
market conditions, at least 65% of the portfolio's assets in foreign securities
(including American Depositary Receipts (ADRs) and European Depositary Receipts
(EDRs). The portfolios expects to invest primarily in equity securities.
The INTERNATIONAL STOCK TRUST seeks long-term growth of capital by
investing primarily in common stocks of established, non-U.S. companies.
The INTERNATIONAL VALUE TRUST seeks long-term growth of capital by
investing, under normal market conditions, primarily in equity securities of
companies located outside the U.S., including in emerging markets.
The MID CAP BLEND TRUST seeks growth of capital by investing primarily
in common stocks of United States issuers and securities convertible into or
carrying the right to buy common stocks.
The SMALL COMPANY VALUE TRUST seeks long-term growth of capital by
investing in equity securities of smaller companies which are traded principally
in the markets of the United States.
The GLOBAL EQUITY TRUST seeks long-term capital appreciation by
investing primarily in equity securities throughout the world, including U.S.
issuers and emerging markets.
The GROWTH TRUST seeks long-term growth of capital by investing
primarily in large capitalization growth securities (market capitalizations of
approximately $1 billion or greater).
The LARGE CAP GROWTH TRUST seeks long-term growth of capital by
investing, under normal market conditions, at least 65% of the portfolio's
assets in equity securities of companies with large market capitalizations.
The QUANTITATIVE EQUITY TRUST seeks to achieve intermediate and
long-term growth through capital appreciation and current income by investing in
common stocks and other equity securities of well established companies with
promising prospects for providing an above average rate of return.
The BLUE CHIP GROWTH TRUST seeks to achieve long-term growth of capital
(current income is a secondary objective) and many of the stocks in the
portfolio are expected to pay dividends.
The REAL ESTATE SECURITIES TRUST seeks to achieve a combination of
long-term capital appreciation and satisfactory current income by investing in
real estate related equity and debt securities.
The VALUE TRUST seeks to realize an above-average total return over a
market cycle of three to five years, consistent with reasonable risk, by
investing primarily in common and preferred stocks, convertible securities,
rights and warrants to purchase common stocks, ADRs and other equity securities
of companies with equity capitalizations usually greater than $300 million.
The GROWTH & INCOME TRUST seeks long-term growth of capital and income,
consistent with prudent investment risk, by investing primarily in a diversified
portfolio of common stocks of United States issuers which the subadviser
believes are of high quality.
The U.S. LARGE CAP VALUE TRUST seeks long-term growth of capital and
income by investing the portfolio's assets, under normal market conditions,
primarily in equity and equity-related securities of companies with market
capitalization greater than $500 million.
The EQUITY-INCOME TRUST seeks to provide substantial dividend income
and also long-term capital appreciation by investing primarily in
dividend-paying common stocks, particularly of established companies with
favorable prospects for both increasing dividends and capital appreciation.
The INCOME & VALUE TRUST seeks the balanced accomplishment of (a)
conservation of principal and (b) long-term growth of capital and income by
investing the portfolio's assets in both equity and fixed income securities. The
subadviser has full discretion to determine the allocation between equity and
fixed income securities.
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<PAGE> 15
The BALANCED TRUST seeks current income and capital appreciation by
investing in a balanced portfolio of common stocks, U.S. and foreign government
obligations and a variety of corporate fixed income securities.
The HIGH YIELD TRUST seeks to realize an above-average total return
over a market cycle of three to five years, consistent with reasonable risk, by
investing primarily in high yield debt securities, including corporate bonds and
other fixed income securities.
The STRATEGIC BOND TRUST seeks a high level of total return consistent
with preservation of capital by giving its subadviser broad discretion to deploy
the portfolio's assets among certain segments of the fixed income market as the
subadviser believes will best contribute to achievement of the portfolio's
investment objective.
The GLOBAL BOND TRUST seeks to realize maximum total return, consistent
with preservation of capital and prudent investment management by investing the
portfolio's asset primarily in fixed income securities denominated in major
foreign currencies, baskets of foreign currencies (such as the ECU),and the U.S.
dollar.
The TOTAL RETURN TRUST seeks to realize maximum total return,
consistent with preservation of capital and prudent investment management by
investing, under normal market conditions, at least 65% of the portfolio's
assets in a diversified portfolio of fixed income securities of varying
maturities. The average portfolio duration will normally vary within a three- to
six- year time frame based on Pacific Investment Management Company's forecast
for interest rates.
The INVESTMENT QUALITY BOND TRUST seeks a high level of current income
consistent with the maintenance of principal and liquidity, by investing
primarily in a diversified portfolio of investment grade corporate bonds and
U.S. Government bonds with intermediate to longer term maturities. The portfolio
may also invest up to 20% of its assets in non-investment grade fixed income
securities.
The DIVERSIFIED BOND TRUST seeks high total return as is consistent
with the conservation of capital by investing at least 75% of the portfolio's
assets in fixed income securities.
The U.S. GOVERNMENT SECURITIES TRUST seeks a high level of current
income consistent with preservation of capital and maintenance of liquidity, by
investing in debt obligations and mortgage-backed securities issued or
guaranteed by the U.S. Government, its agencies or instrumentalities and
derivative securities such as collateralized mortgage obligations backed by such
securities.
The MONEY MARKET TRUST seeks maximum current income consistent with
preservation of principal and liquidity by investing in high quality money
market instruments with maturities of 397 days or less issued primarily by
United States entities.
The LIFESTYLE AGGRESSIVE 1000 TRUST seeks to provide long-term growth
of capital (current income is not a consideration) by investing 100% of the
Lifestyle Trust's assets in other portfolios of the Trust ("UNDERLYING
PORTFOLIOS") which invest primarily in equity securities.
The LIFESTYLE GROWTH 820 TRUST seeks to provide long-term growth of
capital with consideration also given to current income by investing
approximately 20% of the Lifestyle Trust's assets in Underlying Portfolios which
invest primarily in fixed income securities and approximately 80% of its assets
in Underlying Portfolios which invest primarily in equity securities.
The LIFESTYLE BALANCED 640 TRUST seeks to provide a balance between a
high level of current income and growth of capital with a greater emphasis given
to capital growth by investing approximately 40% of the Lifestyle Trust's assets
in Underlying Portfolios which invest primarily in fixed income securities and
approximately 60% of its assets in Underlying Portfolios which invest primarily
in equity securities.
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<PAGE> 16
The LIFESTYLE MODERATE 460 TRUST seeks to provide a balance between a
high level of current income and growth of capital with a greater emphasis given
to high income by investing approximately 60% of the Lifestyle Trust's assets in
Underlying Portfolios which invest primarily in fixed income securities and
approximately 40% of its assets in Underlying Portfolios which invest primarily
in equity securities.
The LIFESTYLE CONSERVATIVE 280 TRUST seeks to provide a high level of
current income with some consideration also given to growth of capital by
investing approximately 80% of the Lifestyle Trust's assets in Underlying
Portfolios which invest primarily in fixed income securities and approximately
20% of its assets in Underlying Portfolios which invest primarily in equity
securities.
A full description of the Trust, including the investment objectives,
policies and restrictions of, and the risks relating to investment in, each
portfolio is contained in the Trust's Prospectus which we provided you along
with this Prospectus. The Trust prospectus should be read carefully before
allocating purchase payments to a sub-account.
If the shares of a Trust portfolio are no longer available for
investment or in our judgment investment in a Trust portfolio becomes
inappropriate, we may eliminate the shares of a portfolio and substitute shares
of another portfolio of the Trust or another open-end registered investment
company. Substitution may be made with respect to both existing investments and
the investment of future purchase payments. However, we will make no such
substitution without first notifying you and obtaining approval of the New York
Superintendent of Insurance and the SEC (to the extent required by the 1940
Act).
You instruct us how to vote Trust shares.
We will vote shares of the Trust portfolios held in the Variable
Account at the Trust's shareholder meetings according to voting instructions
received from the persons having the voting interest under the contracts. We
will determine the number of portfolio shares for which voting instructions may
be given not more than 90 days prior to the meeting. Trust proxy material will
be distributed to each person having the voting interest under the contract
together with appropriate forms for giving voting instructions. We will vote all
portfolio shares that we hold (including our own shares and those we hold in the
Variable Account for contract owners) in proportion to the instructions so
received.
During the accumulation period, the contract owner has the voting
interest under a contract. During the pay-out period, the annuitant has the
voting interest under a contract. We reserve the right to make any changes in
the voting rights described above that may be permitted by the federal
securities laws, regulations or interpretations thereof. For further information
on voting interest under the contract see "Voting Interest" in this prospectus.
DESCRIPTION OF THE CONTRACT
ACCUMULATION PERIOD PROVISIONS
The minimum purchase payment is $25,000. Subsequent purchase payments are not
permitted. Payments over $1 million require our approval.
PURCHASE PAYMENTS
Your purchase payments are made to us at our Annuity Service Office.
The minimum purchase payment is $25,000. Subsequent purchase payments are not
permitted. For purchase payments in excess of $1,000,000 you must obtain our
approval in order to make the payment.
You designate how your purchase payment is to be allocated among the
investment options.
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<PAGE> 17
The value of an investment account is measured in "accumulation units," which
vary in value with the performance of the underlying Trust portfolio.
ACCUMULATION UNITS
During the accumulation period, we will establish an "INVESTMENT
ACCOUNT" for you for each Variable Account investment option to which you
allocate a portion of your contract value. Amounts are credited to those
investment accounts in the form of "ACCUMULATION UNITS" (units of measure used
to calculate the value of the variable portion of your contract during the
accumulation period). The number of accumulation units to be credited to each
investment account is determined by dividing the amount allocated to that
investment account by the value of an accumulation unit for that investment
account next computed after the purchase payment is received at our Annuity
Service Office complete with all necessary information or, in the case of the
first purchase payment, pursuant to the procedures described below.
Initial purchase payments received by mail will usually be credited on
the business day (any date on which the New York Stock Exchange is open and the
net asset value of a Trust portfolio is determined) on which they are received
at our Annuity Service Office, and in any event not later than two business days
after our receipt of all information necessary for issuing the contract. You
will be informed of any deficiencies preventing processing if your contract
cannot be issued. If the deficiencies are not remedied within five business days
after receipt, your purchase payment will be returned promptly, unless you
specifically consent to our retaining your purchase payment until all necessary
information is received. Initial purchase payments received by wire transfer
from broker-dealers will be credited on the business day received by us if the
broker-dealers have made special arrangements with us.
VALUE OF ACCUMULATION UNITS
The value of your accumulation units will vary from one business day to
the next depending upon the investment results of the investment options you
select. The value of an accumulation unit for each sub-account was arbitrarily
set at $10 or $12.50 for the first business day under other contracts we have
issued. The value of an accumulation unit for any subsequent business day is
determined by multiplying the value of an accumulation unit for the immediately
preceding business day by the net investment factor for that sub-account
(described below) for the business day for which the value is being determined.
Accumulation units will be valued at the end of each business day. A business
day is deemed to end at the time of the determination of the net asset value of
the Trust shares.
NET INVESTMENT FACTOR
The net investment factor is an index used to measure the investment
performance of a sub-account from one business day to the next (the "VALUATION
PERIOD"). The net investment factor may be greater or less than or equal to one;
therefore, the value of an accumulation unit may increase, decrease or remain
the same. The net investment factor for each sub-account for any valuation
period is determined by dividing (a) by (b) and subtracting (c) from the result:
- Where (a) is:
- the net asset value per share of a portfolio share
held in the sub-account determined at the end of the
current valuation period, plus
- the per share amount of any dividend or capital gain
distributions made by the portfolio on shares held in
the sub-account if the "ex-dividend" date occurs
during the current valuation period.
- Where (b) is the net asset value per share of a portfolio
share held in the sub-account determined as of the end of the
immediately preceding valuation period.
- Where (c) is a factor representing the charges deducted from
the sub-account on a daily basis for administrative expenses,
a portion of the distribution expenses, and mortality and
expense risks. That factor is equal on an annual basis to
1.65% (0.25% for administrative expenses, 0.15% for
distribution expenses and 1.25% for mortality and expense
risks).
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<PAGE> 18
Amounts invested may be transferred among investment options.
TRANSFERS AMONG INVESTMENT OPTIONS
During the accumulation period, you may transfer amounts among the
investment options at any time and without charge upon written notice to us.
Accumulation units will be canceled from the investment account from which you
transfer amounts transferred and credited to the investment account to which you
transfer amounts. Your contract value on the date of the transfer will not be
affected by a transfer. You must transfer at least $300 or, if less, the entire
value of the investment account. If after the transfer the amount remaining in
the investment account is less than $100, then we will transfer the entire
amount instead of the requested amount. We reserve the right to limit, upon
notice, the maximum number of transfers you may make to one per month or six at
any time within a contract year. In addition, we reserve the right to defer a
transfer at any time we are unable to purchase or redeem shares of the Trust
portfolios. We also reserve the right to modify or terminate the transfer
privilege at any time (to the extent permitted by applicable law).
Currently, the Company imposes no charge for transfer requests. The
first twelve transfers in a contract year are free of any transfer charge. For
each additional transfer in a contract year, the Company does not currently
assess a charge but reserves the right (to the extent permitted by your
contract) to assess a reasonable charge to reimburse it for the expenses of
processing transfers.
Where permitted by law, we may accept your authorization for a third
party to make transfers for you subject to our rules. However, the contract is
not designed for professional market timing organizations or other entities or
persons engaging in programmed, frequent or large exchanges (collectively,
"market timers") to speculate on short-term movements in the market since such
activity may be disruptive to the Trust portfolios and increase their
transaction costs. Therefore, in order to prevent excessive use of the exchange
privilege, we reserve the right to (a) reject or restrict any specific purchase
and exchange requests and (b) impose specific limitations with respect to market
timers, including restricting exchanges by market timers to certain variable
investment options (transfers by market timers into or out of fixed investment
options is not permitted).
MAXIMUM NUMBER OF INVESTMENT OPTIONS
You currently are limited to a maximum of seventeen investment options
(including all fixed account investment options) during the accumulation period.
In calculating this limit, investment options to which you have allocated the
purchase payment at any time during the accumulation period will be counted
toward the seventeen maximum even if you no longer have contract value allocated
to the investment option.
TELEPHONE TRANSACTIONS
Any person who can furnish proper account identification is permitted
to request transfers by telephone. The telephone transaction privilege is made
available automatically without the contract owner's election. We will not be
liable for following instructions communicated by telephone that we reasonably
believe to be genuine. We will employ reasonable procedures to confirm that
instructions communicated by telephone are genuine and may only be liable for
any losses due to unauthorized or fraudulent instructions where we fail to
employ our procedures properly. Such procedures include the following: upon
telephoning a request, you will be asked to provide information that verifies
that it is you calling. For both your and our protection, we will tape record
all conversations with you. All telephone transactions will be followed by a
confirmation statement of the transaction. We reserve the right to impose new
procedural requirements regarding transfer privileges.
Dollar Cost Averaging and Asset Rebalancing programs are available.
SPECIAL TRANSFER SERVICES - DOLLAR COST AVERAGING
We administer a Dollar Cost Averaging ("DCA") program. If you enter
into a DCA agreement, you may instruct us to transfer monthly a predetermined
dollar amount from any sub-account or the one year fixed account investment
option to other sub-accounts until the amount in the sub-account from which the
transfer is made or one year fixed account investment option is exhausted. A DCA
fixed account investment option may be established under the DCA program to make
automatic transfers. Only purchase payments (and not existing contract values)
may be allocated to the DCA fixed account investment option. If the DCA fixed
account investment option is elected, the amounts allocated to this account will
be credited with interest at the guaranteed interest rate in effect on the date
of such allocation.
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<PAGE> 19
The DCA program is generally suitable if you are making a substantial
deposit and desire to control the risk of investing at the top of a market
cycle. The DCA program allows investments to be made in equal installments over
time in an effort to reduce that risk. Therefore, a lower purchase price may be
achieved over the long-term by purchasing more accumulation units of a
particular sub-account when the unit value is low; less when the unit value is
high. However, the DCA program does not guarantee profits or prevent losses in a
declining market and requires regular investment regardless of fluctuating price
levels. Contract owners interested in the DCA program should consider their
financial ability to continue purchases through periods of low price levels. If
you are interested in the DCA program, you may elect to participate in the
program on the application or by separate application. You may obtain a separate
application and full information concerning the program and its restrictions
from your securities dealer or our Annuity Service Office. There is no charge
for participation in the DCA program.
ASSET REBALANCING PROGRAM
We administer an Asset Rebalancing Program which enables you to specify
the percentage levels you would like to maintain in particular portfolios. Your
contract value will be automatically rebalanced pursuant to the schedule
described below to maintain the indicated percentages by transfers among the
portfolios. (The Fixed Account Investment Options are not eligible for
participation in the Asset Rebalancing Program.) The entire value of the
variable investment accounts must be included in the Asset Rebalancing Program.
Other investment programs, such as the DCA program, or other transfers or
withdrawals may not work in concert with the Asset Rebalancing Program.
Therefore, you should monitor your use of these other programs and any other
transfers or withdrawals while the Asset Rebalancing Program is being used. If
you are interested in the Asset Rebalancing Program, you may obtain a separate
application and full information concerning the program and its restrictions
from your securities dealer or our Annuity Service Office. There is no charge
for participation in the Asset Rebalancing Program.
Asset rebalancing will only be permitted on the following time
schedules:
- quarterly on the 25th day of the last month of the quarter (or
the next business day if the 25th is not a business day);
- semi-annually on June 25th or December 26th (or the next
business day if these dates are not business days); or
- annually on December 26th (or the next business day if
December 26th is not a business day).
You may withdraw all or a portion of your contract value, but may incur tax
liability as a result.
WITHDRAWALS
During the accumulation period, you may withdraw all or a portion of
your contract value upon written request (complete with all necessary
information) to our Annuity Service Office. For certain qualified contracts,
exercise of the withdrawal right may require the consent of the qualified plan
participant's spouse under the Internal Revenue Code of 1986, as amended (the
"Code") and related Treasury Department regulations. In the case of a total
withdrawal, we will pay the contract value as of the date of receipt of the
request at our Annuity Service Office, minus the annual $30 administration fee
(if applicable) and any unpaid loans (including unpaid interest). The contract
then will be canceled. In the case of a partial withdrawal, we will pay the
amount requested and cancel accumulation units credited to each investment
account equal in value to the amount withdrawn from that investment account.
When making a partial withdrawal, you should specify the investment
options from which the withdrawal is to be made. The amount requested from an
investment option may not exceed the value of that investment option. If you do
not specify the investment options from which a partial withdrawal is to be
taken, the withdrawal will be taken from the variable account investment options
until exhausted and then from the fixed account investment options. If the
partial withdrawal is less than the total value in the variable account
investment options, the withdrawal will be taken proportionately from all of
your variable account investment options. For rules governing the order and
manner of withdrawals from the fixed account investment options, see "FIXED
ACCOUNT INVESTMENT OPTIONS".
There is no limit on the frequency of partial withdrawals; however, the
amount withdrawn must be at least $300 or, if less, the entire balance in the
investment option. If after the withdrawal the amount remaining in the
investment option is less than $100, we will treat the partial withdrawal as a
withdrawal of
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<PAGE> 20
the entire amount held in the investment option. If a partial withdrawal charge
would reduce the contract value to less than $300, we will treat the partial
withdrawal as a total withdrawal of the contract value.
The amount of any withdrawal from the variable account investment
options will be paid promptly, and in any event within seven days of receipt of
the request, complete with all necessary information at our Annuity Service
Office, except that we reserve the right to defer the right of withdrawal or
postpone payments for any period when:
- the New York Stock Exchange is closed (other than customary
weekend and holiday closings),
- trading on the New York Stock Exchange is restricted,
- an emergency exists as a result of which disposal of
securities held in the Variable Account is not reasonably
practicable or it is not reasonably practicable to determine
the value of the Variable Account's net assets, or
- the SEC, by order, so permits for the protection of security
holders; provided that applicable rules and regulations of the
SEC shall govern as to whether trading is restricted or an
emergency exists.
Withdrawals from the contract may be subject to income tax and a 10%
penalty tax (See "Federal Tax Matters"). Withdrawals are permitted from
contracts issued in connection with Section 403(b) qualified plans only under
limited circumstances (see Appendix C: "Qualified Plan Types")
Systematic "Income Plan" withdrawals are available.
SPECIAL WITHDRAWAL SERVICES - THE INCOME PLAN
We administer an Income Plan ("IP") which permits you to pre-authorize
a periodic exercise of the contractual withdrawal rights described above. After
entering into an IP agreement, you may instruct us to withdraw a level dollar
amount from specified investment options on a periodic basis. The total of IP
withdrawals in a contract year is limited to not more than 20% of the purchase
payment made. If an additional withdrawal is made from a contract participating
in an IP, the IP will terminate automatically and may be reinstated only on or
after the next contract anniversary pursuant to a new application. The IP is not
available to contracts participating in the dollar cost averaging program. IP
withdrawals, like other withdrawals, may be subject to income tax and a 10%
penalty tax. If you are interested in an IP, you may obtain a separate
application and full information concerning the program and its restrictions
from your securities dealer or our Annuity Service Office. The IP program is
offered without charge.
If you die during the accumulation period, your beneficiary will receive a death
benefit that might exceed your contract value.
DEATH BENEFIT DURING ACCUMULATION PERIOD
IN GENERAL. The following discussion applies principally to contracts
that are not issued in connection with qualified plans, i.e., "NON-QUALIFIED
CONTRACTS." Tax law requirements applicable to qualified plans, and the tax
treatment of amounts held and distributed under such plans, are quite complex.
Accordingly, if your contract is to be used in connection with a qualified plan,
you should seek competent legal and tax advice regarding the suitability of the
contract for the situation involved and the requirements governing the
distribution of benefits, including death benefits, from a contract used in the
plan. In particular, if you intend to use the contract in connection with a
qualified plan, you should consider that the contract provides a death benefit
(described below) that could be characterized as an "incidental death benefit."
There are limits on the amount of incidental benefits that may be provided under
certain qualified plans and the provision of such benefits may result in
currently taxable income to plan participants (see "FEDERAL TAX MATTERS" and
Appendix C).
AMOUNT OF DEATH BENEFIT. If any owner dies and the oldest owner had an
attained age of less than 81 years on the contract date, the death benefit will
be determined as follows:
During the first contract year, the death benefit will be the greater
of:
- the contract value or
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<PAGE> 21
- the sum of the purchase payment made, less any amounts
deducted in connection with partial withdrawals.
During any subsequent contract year, the death benefit will be the
greater of:
- the contract value or
- the death benefit on the last day of the previous contract
year, less any amounts deducted in connection with partial
withdrawals since then.
If any owner dies on or after his or her 81st birthday, the death
benefit will be the greater of:
- the contract value or
- the death benefit on the last day of the contract year ending
just prior to the owner's 81st birthday, less amounts deducted
in connection with partial withdrawals.
If any owner dies and the oldest owner had an attained age of 81 years
or greater on the contract date, the death benefit will be greater of:
- the contract value or
- the excess of the purchase payment over the sum of any amounts
deducted in connection with partial withdrawals.
The determination of the death benefit will be made on the date we
receive written notice and "proof of death" as well as all required completed
claims forms, at our Annuity Service Office. No one is entitled to the death
benefit until this time. Death benefits will be paid within 7 days of that
determination. Proof of death occurs when we receive one of the following at our
Annuity Service Office within one year of the date of death:
- a certified copy of a death certificate;
- a certified copy of a decree of a court of competent
jurisdiction as to the finding of death; or
- any other proof satisfactory to us.
If there are any unpaid loans, the death benefit equals the death benefit, as
described above, minus the amount of unpaid loans (including unpaid interest).
PAYMENT OF DEATH BENEFIT. We will pay the death benefit to the
beneficiary if any contract owner dies before the maturity date. If there is a
surviving contract owner, that contract owner will be deemed to be the
beneficiary. No death benefit is payable on the death of any annuitant, except
that if any contract owner is not a natural person, the death of any annuitant
will be treated as the death of an owner. On the death of the last surviving
annuitant, the contract owner, if a natural person, will become the annuitant
unless the contract owner designates another person as the annuitant.
The death benefit may be taken in the form of a lump sum immediately,
in which case the contract will terminate. If not taken immediately, the
contract will continue subject to the following:
- The beneficiary will become the contract owner.
- Any excess of the death benefit over the contract value will
be allocated to the owner's investment accounts in proportion
to their relative values on the date of receipt at our Annuity
Service Office of due proof of the owner's death.
- No additional purchase payments may be made.
- If the beneficiary is not the deceased owner's spouse,
distribution of the contract owner's entire interest in the
contract must be made within five years of the owner's death,
or alternatively, distribution may be made as an annuity,
under one of the annuity options described below, which begins
within one year of the owner's death and is payable over the
life of the beneficiary or over a period not extending beyond
the life expectancy of the beneficiary. Upon the death of the
beneficiary, the death benefit will equal the contract value
and must be distributed immediately in a single sum.
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- If the owner's spouse is the beneficiary, the spouse continues
the contract as the new owner. In such a case, the
distribution rules applicable when a contract owner dies will
apply when the spouse, as the owner, dies. In addition, a
death benefit will be paid upon the death of the spouse. For
purposes of calculating the death benefit payable upon the
death of the spouse, the death benefit paid upon the first
owner's death will be treated as a purchase payment to the
contract. In addition, the purchase payment and all amounts
deducted in connection with partial withdrawals prior to the
date of the first owner's death will not be considered in the
determination of the spouse's death benefit.
If any annuitant is changed and any contract owner is not a natural
person, the entire interest in the contract must be distributed to the contract
owner within five years.
A substitution or addition of any contract owner may result in
resetting the death benefit to an amount equal to the contract value as of the
date of the change. For purposes of subsequent calculations of the death benefit
prior to the maturity date, the contract value on the date of the change will be
treated as an initial purchase payment made on that date. In addition, all
payments made and all amounts deducted in connection with partial withdrawals
prior to the date of the change will not be considered in the determination of
the death benefit. No such change in death benefit will be made if the person
whose death will cause the death benefit to be paid is the same after the change
in ownership or if ownership is transferred to the owner's spouse.
Death benefits will be paid within seven days of the date the amount of
the death benefit is determined, as described above, subject to postponement
under the same circumstances that payment of withdrawals may be postponed (see
"WITHDRAWALS").
PAY-OUT PERIOD PROVISIONS
You have a choice of several different ways of receiving annuity benefit
payments from us.
GENERAL
You or your beneficiary may elect to have any amounts that we are
obligated to pay you or your beneficiary on withdrawal or death, or as of the
maturity date, paid by means of periodic annuity benefit payments rather than in
one lump sum (subject to the distribution of death benefit provisions described
above).
Generally, we will begin paying annuity benefits under the contract on
the contract's maturity date (the first day of the pay-out period). The maturity
date is the date specified on your contract's specifications page, unless you
change that date. If no date is specified, the maturity date is the maximum
maturity date described below. The maximum maturity date is the first day of the
month following the 90th birthday of the annuitant. You may specify a different
maturity date at any time by written request at least one month before both the
previously specified and the new maturity date. The new maturity date may not be
later than the maximum maturity date. Maturity dates which occur at advanced
ages, e.g., past age 85, may in some circumstances have adverse income tax
consequences (see "FEDERAL TAX MATTERS"). Distributions from qualified contracts
may be required before the maturity date.
You may select the frequency of annuity payments. However, if the
contract value at the maturity date is such that a monthly payment would be less
than $20, we may pay the contract value, minus any unpaid loans, in one lump sum
to the annuitant on the maturity date.
ANNUITY OPTIONS
Annuity benefit payments are available under the contract on a fixed,
variable, or combination fixed and variable basis. Upon purchase of the
contract, and at any time during the accumulation period, you may select one or
more of the annuity options described below on a fixed and/or variable basis
(except Option 5 which is available on a fixed basis only) or choose an
alternate form of payment acceptable to us. If an annuity option is not
selected, we will provide as a default option a life annuity with payments
guaranteed for ten years as described below. Annuity payments will be determined
based on the Investment Account Value of each investment option at the maturity
date. Treasury Department regulations may preclude the availability of certain
annuity options in connection with certain qualified contracts.
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Please read the description of each annuity option carefully. In
general, a non-refund life annuity provides the highest level of payments.
However, because there is no guarantee that any minimum number of payments will
be made, an annuitant may receive only one payment if the annuitant dies prior
to the date the second payment is due. Annuities with payments guaranteed for a
certain number of years may also be elected but the amount of each payment will
be lower than that available under the non-refund life annuity option.
The following annuity options are guaranteed to be offered in the
contract.
OPTION 1(a): NON-REFUND LIFE ANNUITY - An annuity with payments during
the lifetime of the annuitant. No payments are due after the death of
the annuitant. Because there is no guarantee that any minimum number of
payments will be made, an annuitant may receive only one payment if the
annuitant dies prior to the date the second payment is due.
OPTION 1(b): LIFE ANNUITY WITH PAYMENTS GUARANTEED FOR 10 YEARS - An
annuity with payments guaranteed for 10 years and continuing thereafter
during the lifetime of the annuitant. Because payments are guaranteed
for 10 years, annuity payments will be made to the end of such period
if the annuitant dies prior to the end of the tenth year.
OPTION 2(a): JOINT & SURVIVOR NON-REFUND LIFE ANNUITY - An annuity with
payments during the lifetimes of the annuitant and a designated
co-annuitant. No payments are due after the death of the last survivor
of the annuitant and co-annuitant. Because there is no guarantee that
any minimum number of payments will be made, an annuitant or
co-annuitant may receive only one payment if the annuitant and
co-annuitant die prior to the date the second payment is due.
OPTION 2(b): JOINT & SURVIVOR LIFE ANNUITY WITH PAYMENTS GUARANTEED FOR
10 YEARS - An annuity with payments guaranteed for 10 years and
continuing thereafter during the lifetimes of the annuitant and a
designated co-annuitant. Because payments are guaranteed for 10 years,
annuity payments will be made to the end of such period if both the
annuitant and the co-annuitant die prior to the end of the tenth year.
In addition to the foregoing annuity options which we are contractually
obligated to offer at all times, we currently offer the following annuity
options. We may cease offering the following annuity options at any time and may
offer other annuity options in the future.
OPTION 3: LIFE ANNUITY WITH PAYMENTS GUARANTEED FOR 5, 15 OR 20 YEARS -
An Annuity with payments guaranteed for 5, 15 or 20 years and
continuing thereafter during the lifetime of the annuitant. Because
payments are guaranteed for the specific number of years, annuity
payments will be made to the end of the last year of the 5, 15 or 20
year period.
OPTION 4: JOINT & TWO-THIRDS SURVIVOR NON-REFUND LIFE ANNUITY - An
annuity with full payments during the joint lifetime of the annuitant
and a designated co-annuitant and two-thirds payments during the
lifetime of the survivor. Because there is no guarantee that any
minimum number of payments will be made, an annuitant or co-annuitant
may receive only one payment if the annuitant and co-annuitant die
prior to the date the second payment is due.
OPTION 5: PERIOD CERTAIN ONLY ANNUITY FOR 5, 10, 15 OR 20 YEARS - An
annuity with payments for a 5, 10, 15 or 20 year period and no payments
thereafter.
DETERMINATION OF AMOUNT OF THE FIRST VARIABLE ANNUITY PAYMENT
The first variable annuity payment is determined by applying that
amount of the contract value used to purchase a variable annuity to the annuity
tables contained in the contract. The amount of the contract value will be
determined as of a date not more than ten business days prior to the maturity
date. The amount of the first and all subsequent fixed annuity payments is
determined on the same basis using the portion of the contract value used to
purchase a fixed annuity. Contract value used to determine annuity payments will
be reduced by any applicable premium taxes.
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The rates contained in the annuity tables vary with the annuitant's
sex and age and the annuity option selected. However, for contracts issued in
connection with certain employer-sponsored retirement plans sex-distinct tables
may not be used. Under such tables, the longer the life expectancy of the
annuitant under any life annuity option or the longer the period for which
payments are guaranteed under the option, the smaller the amount of the first
monthly variable annuity payment will be.
ANNUITY UNITS AND THE DETERMINATION OF SUBSEQUENT VARIABLE ANNUITY PAYMENTS
Variable annuity payments after the first one will be based on the
investment performance of the sub-accounts selected during the pay-out period.
The amount of a subsequent payment is determined by dividing the amount of the
first annuity payment from each sub-account by the annuity unit value of that
sub-account (as of the same date the contract value to effect the annuity was
determined) to establish the number of annuity units which will thereafter be
used to determine payments. This number of annuity units for each sub-account is
then multiplied by the appropriate annuity unit value as of a uniformly applied
date not more than ten business days before the annuity payment is due, and the
resulting amounts for each sub-account are then totaled to arrive at the amount
of the annuity benefit payment to be made. The number of annuity units generally
remains constant throughout the pay-out period (assuming no transfer is made).
The value of an annuity unit for each sub-account for any business day
is determined by multiplying the annuity unit value for the immediately
preceding business day by the net investment factor for that sub-account (see
"NET INVESTMENT FACTOR") for the valuation period for which the annuity unit
value is being calculated and by a factor to neutralize the assumed interest
rate.
A 3% assumed interest rate is built into the annuity tables in the
contract used to determine the first variable annuity payment.
Some transfers are permitted during the pay-out period, but subject to a few
more limitations than during the accumulation period.
TRANSFERS DURING PAY-OUT PERIOD
Once variable annuity payments have begun, you may transfer all or part
of the investment upon which those payments are based from one sub-account to
another. You must submit your transfer request to our Annuity Service Office at
least 30 days before the due date of the first annuity payment to which your
transfer will apply. Transfers after the maturity date will be made by
converting the number of annuity units being transferred to the number of
annuity units of the sub-account to which the transfer is made, so that the next
annuity payment if it were made at that time would be the same amount that it
would have been without the transfer. Thereafter, annuity payments will reflect
changes in the value of the annuity units for the new sub-account selected. We
reserve the right to limit, upon notice, the maximum number of transfers a
contract owner may make per contract year to four. Once annuity payments have
commenced, no transfers may be made from a fixed annuity option to a variable
annuity option or from a variable annuity option to a fixed annuity option. In
addition, we reserve the right to defer the transfer privilege at any time that
we are unable to purchase or redeem shares of the Trust portfolios. We also
reserve the right to modify or terminate the transfer privilege at any time in
accordance with New York law.
DEATH BENEFIT DURING PAY-OUT PERIOD
If an annuity option providing for payments for a guaranteed period has
been selected, and the annuitant dies during the pay-out period, we will make
the remaining guaranteed payments to the beneficiary. Any remaining payments
will be made as rapidly as under the method of distribution being used as of the
date of the annuitant's death. If no beneficiary is living, we will commute any
unpaid guaranteed payments to a single sum (on the basis of the interest rate
used in determining the payments) and pay that single sum to the estate of the
last to die of the annuitant and the beneficiary.
OTHER CONTRACT PROVISIONS
You have a ten-day right to cancel your contract.
RIGHT TO REVIEW CONTRACT
You may cancel the contract by returning it to our Annuity Service
Office or to your registered representative within 10 days after receiving it.
Within 7 days of receiving a returned contract, we will pay you the contract
value (minus any unpaid loans) computed at the end of the business day on which
we receive
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your contract. When the contract is issued as an individual retirement annuity
under Sections 408 or 408A of the Code, during the first 7 days of the 10 day
period we will return the purchase payment if it is greater than the amount
otherwise payable.
If you purchased the contract in connection with a replacement of an
existing annuity contract (as described below), you may also cancel the contract
by returning it to our Annuity Service Office or your registered representative
at any time within 60 days after receiving the contract. Within 10 days of
receiving a returned contract, we will pay you the contract value (minus any
unpaid loans) computed at the end of the business day on which we receive your
returned contract. In the case of a replacement of a contract issued by a New
York insurance company, you may have the right to reinstate the prior contract.
You should consult with your registered representative or attorney regarding
this matter prior to purchasing the new contract.
Replacement of an existing annuity contract generally is defined as the
purchase of a new annuity contract in connection with (a) the lapse, partial or
full surrender or change of, or borrowing from, an existing annuity or life
insurance contract or (b) the assignment to a new issuer of an existing annuity
contract. This description, however, does not necessarily cover all situations
which could be considered a replacement of an existing annuity contract.
Therefore, you should consult with your registered representative or attorney
regarding whether the purchase of a new annuity contract is a replacement of an
existing annuity or life insurance contract.
OWNERSHIP
You are entitled to exercise all rights under your contract.
The contract owner is the person entitled to exercise all rights under
the contract. Prior to the maturity date, the contract owner is the person
designated in the contract specifications page or as subsequently named. On and
after the maturity date, the annuitant is the contract owner. If amounts become
payable to any beneficiary under the contract, the beneficiary is the contract
owner.
In the case of non-qualified contracts, ownership of the contract may
be changed or the contract may be collaterally assigned at any time prior to the
maturity date, subject to the rights of any irrevocable beneficiary. Assigning a
contract, or changing the ownership of a contract, may be treated as a
(potentially taxable) distribution of the contract value for federal tax
purposes. A change of any contract owner may result in resetting the death
benefit to an amount equal to the contract value as of the date of the change
and treating that value as a purchase payment made on that date for purposes of
computing the amount of the death benefit.
Any change of ownership or assignment must be made in writing. We must
approve any change. Any assignment and any change, if approved, will be
effective as of the date we receive the request at our Annuity Service Office.
We assume no liability for any payments made or actions taken before a change is
approved or an assignment is accepted or responsibility for the validity or
sufficiency of any assignment. An absolute assignment will revoke the interest
of any revocable beneficiary.
In the case of qualified contracts, ownership of the contract generally
may not be transferred except by the trustee of an exempt employees' trust which
is part of a retirement plan qualified under Section 401 of the Code or as
otherwise permitted by applicable Internal Revenue Service ("IRS") regulations.
Subject to the foregoing, a qualified contract may not be sold, assigned,
transferred, discounted or pledged as collateral for a loan or as security for
the performance of an obligation or for any other purpose to any person other
than us.
The "annuitant" is either you or someone you designate.
ANNUITANT
The annuitant is any natural person or persons whose life is used to
determine the duration of annuity payments involving life contingencies. If the
contract owner names more than one person as an "annuitant," the second person
named shall be referred to as "CO-ANNUITANT." The annuitant is as designated on
the contract specifications page or in the application, unless changed.
On the death of the annuitant, the co-annuitant, if living, becomes the
annuitant. If there is no living co-annuitant, the owner becomes the annuitant.
In the case of certain qualified contracts, there are limitations on the ability
to designate and change the annuitant and the co-annuitant.
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The "beneficiary" is the person you designate to receive the death benefit if
you die.
BENEFICIARY
The beneficiary is the person, persons or entity designated in the
contract specifications page (or as subsequently changed). However, if there is
a surviving contract owner, that person will be treated as the beneficiary. The
beneficiary may be changed subject to the rights of any irrevocable beneficiary.
Any change must be made in writing, approved by us, and (if approved) will be
effective as of the date on which written. We assume no liability for any
payments made or actions taken before the change is approved. If no beneficiary
is living, the contingent beneficiary will be the beneficiary. The interest of
any beneficiary is subject to that of any assignee. If no beneficiary or
contingent beneficiary is living, the beneficiary is the estate of the deceased
contract owner. In the case of certain qualified contracts, Treasury Department
regulations may limit designations of beneficiaries.
MODIFICATION
We may not modify your contract without your consent, except to the
extent required to make it conform to any law or regulation or ruling issued by
a governmental agency. The provisions of the contract shall be interpreted so as
to comply with the requirements of Section 72(s) of the Code.
OUR APPROVAL
We reserve the right to accept or reject any contract application at
our sole discretion.
MISSTATEMENT AND PROOF OF AGE, SEX OR SURVIVAL
We may require proof of age, sex or survival of any person upon whose
age, sex or survival any payment depends. If the age or sex of the annuitant has
been misstated, the benefits will be those that would have been provided for the
annuitant's correct age and sex. If we have made incorrect annuity payments, the
amount of any underpayment will be paid immediately and the amount of any
overpayment will be deducted from future annuity payments.
FIXED ACCOUNT INVESTMENT OPTIONS
The fixed account investment options are not securities.
SECURITIES REGISTRATION. Interests in the fixed account investment
options are not registered under the Securities Act of 1933, as amended, (the
"1933 Act") and our general account is not registered as an investment company
under the 1940 Act. Neither interests in the fixed account investment options
nor the general account are subject to the provisions or restrictions of the
1933 Act or the 1940 Act. Disclosures relating to interests in the fixed account
investment options and the general account nonetheless may be required by the
federal securities laws to be accurate.
Fixed account investment options guarantee interest of at least 3%.
INVESTMENT OPTIONS. A one-year fixed account investment option is
available under the contract. In addition, a DCA fixed investment account may be
established under the DCA program to make automatic transfers to one or more
variable investment option. Under the fixed account investment options, we
guarantee the principal value of purchase payments and the rate of interest
credited to the investment account for the term of the guarantee period. The
portion of the contract value in a fixed account investment option and any fixed
annuity benefit payments will reflect those interest and principal guarantees.
We determine the guaranteed interest rates on new amounts allocated or
transferred to a fixed investment account from time to time, according to market
conditions. In no event will the guaranteed rate of interest be less than 3%.
Once an interest rate is guaranteed for a fixed investment account, it is
guaranteed for the duration of the guarantee period and we may not change it.
INVESTMENT ACCOUNTS. You may allocate purchase payments, or make
transfers from the variable investment options, to the one-year fixed account
investment option at any time prior to the maturity date. We establish a
separate investment account each time you allocate or transfer amounts to the
one-year fixed account investment option. Amounts may not be allocated to a
fixed account investment option that would extend the guarantee period beyond
the maturity date.
RENEWALS. At the end of a guarantee period, you may establish a new
investment account with a one-year guarantee period at the then current interest
rate or transfer the amounts to a variable account investment option, all
without the imposition of any charge. In the case of renewals in the last year
of the accumulation period, the only fixed account investment option available
is to have interest accrued for the
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remainder of the accumulation period at the then current interest rate for
one-year guarantee periods. If you do not specify a renewal option, we will
select the one-year fixed account investment option. In the case of a renewal in
the last year of the accumulation period, we will credit interest for the
remainder of the accumulation period at the then current interest rate for
one-year guarantee periods.
Withdrawals and some transfers from fixed account investment options are
permitted during the accumulation period.
TRANSFERS. During the accumulation period, you normally may transfer
amounts from the fixed account investment option to the variable account
investment options only at the end of a guaranteed period. You may, however,
transfer amounts from fixed to variable account investment options prior to the
end of the guarantee period pursuant to the DCA program. Where there are
multiple investment accounts within the one-year fixed account investment
option, amounts must be transferred from the one-year fixed account investment
option on a first-in-first-out basis.
WITHDRAWALS. You may make total and partial withdrawals of amounts held
in the fixed account investment options at any time during the accumulation
period. Withdrawals from the fixed account investment options will be made in
the same manner and be subject to the same limitations as set forth under
"WITHDRAWALS" plus the following provisions also apply to withdrawals from the
fixed account investment options:
- We reserve the right to defer payment of amounts withdrawn
from the fixed account investment options for up to six months
from the date we receive the written withdrawal request. If a
withdrawal is deferred for more than 30 days pursuant to this
right, we will pay interest on the amount deferred at a rate
not less than 3% per year (or a higher rate if required by
applicable law).
- If there are multiple investment accounts under the fixed
account investment options, amounts must be withdrawn from
those accounts on a first-in-first-out basis.
If you do not specify the investment options from which a partial
withdrawal is to be taken, the partial withdrawal will be taken from the
variable account investment options until exhausted and then from the fixed
account investment options. Such withdrawals will be made from the investment
options beginning with the shortest guarantee period. Within such a sequence,
where there are multiple investment accounts within a fixed account investment
option, withdrawals will be made on a first-in-first-out basis. For this
purpose, the DCA fixed account investment option is considered to have a shorter
guarantee period than the one-year fixed account investment option.
Withdrawals from the contract may be subject to income tax and a 10%
penalty tax (see "FEDERAL TAX MATTERS" below). Withdrawals are permitted from
contracts issued in connection with Section 403(b) qualified plans only under
limited circumstances (see Appendix C "Qualified Plan Types").
LOANS. We offer a loan privilege only to owners of contracts issued in
connection with Section 403(b) qualified plans that are not subject to Title I
of ERISA. If you own such a contract, you may borrow from us, using your
contract as the only security for the loan, in the same manner and subject to
the same limitations as described under "LOANS" above.
FIXED ANNUITY OPTIONS. Subject to the distribution of death benefits
provisions (see "DEATH BENEFIT DURING ACCUMULATION PERIOD" above), on death,
withdrawal or the maturity date of the contract, the proceeds may be applied to
a fixed annuity option (see "ANNUITY OPTIONS" above). The amount of each fixed
annuity payment is determined by applying the portion of the proceeds (minus any
applicable premium taxes) applied to purchase the fixed annuity to the
appropriate table in the contract. If the table we are then using is more
favorable to you, we will substitute that table. We guarantee the dollar amount
of fixed annuity payments.
CHARGES. No administrative, distribution, or mortality and expense
risks charges are deducted from fixed account investment options.
CHARGES AND DEDUCTIONS
Charges and deductions under the contracts are assessed against the
purchase payment, contract values or annuity payments. In addition, there are
deductions from and expenses paid out of the assets of the Trust portfolios that
are described in the accompanying Prospectus of the Trust.
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We deduct asset-based charges totaling 1.65% on an annual basis for
administration, distribution and mortality and expense risks.
ADMINISTRATION FEES
A daily fee in an amount equal to 0.25% of the value of each variable
investment account on an annual basis is deducted from each sub-account as an
administration fee. The fee is designed to compensate us for administering the
contracts and operating the Variable Account. Even though administrative
expenses may increase, we guarantee that we will not increase the amount of the
administration fees.
If your contract value falls below $10,000 as a result of a partial
withdrawal, we may deduct an annual administration fee of $30 as partial
compensation for administrative expenses. The fee will be deducted on the last
day of each contract year. It will be withdrawn from each investment option in
the same proportion that the value of such investment option bears to the
contract value. If the entire contract value is withdrawn on other than the last
day of any contract year, the fee will be deducted from the amount paid.
DISTRIBUTION FEE
A daily fee in an amount equal to 0.15% of the value of each variable
investment account on an annual basis is deducted from each sub-account as a
distribution fee. The fee is designed to compensate us for a portion of the
expenses we incur in selling the contracts.
MORTALITY AND EXPENSE RISKS CHARGE
The mortality risk we assume is the risk that annuitants may live for a
longer period of time than we estimate. We assume this mortality risk by virtue
of annuity benefit payment rates incorporated into the contract which cannot be
changed. This assures each annuitant that his or her longevity will not have an
adverse effect on the amount of annuity benefit payments. We also assume
mortality risks in connection with our guarantee that, if the contract owner
dies during the accumulation period, we will pay a death benefit. The expense
risk we assume is the risk that the administration charges, distribution charge,
or withdrawal charge may be insufficient to cover actual expenses.
To compensate us for assuming these risks, we deduct from each of the
sub-accounts a daily charge in an amount equal to 1.25% of the value of the
variable investment accounts on an annual basis. The rate of the mortality and
expense risks charge cannot be increased. If the charge is insufficient to cover
the actual cost of the mortality and expense risks assumed, we will bear the
loss. Conversely, if the charge proves more than sufficient, the excess will be
profit to us and will be available for any proper corporate purpose including,
among other things, payment of distribution expenses. The mortality and expense
risks charge is not assessed against the fixed account investment options.
We will charge you for state premium taxes to the extent we incur them and
reserve the right to charge you for new taxes we may incur.
TAXES
We reserve the right to charge, or provide for, certain taxes against
purchase payments, contract values or annuity payments. Such taxes may include
premium taxes or other taxes levied by any government entity which we determine
to have resulted from our:
- establishment or maintenance of the Variable Account,
- receipt of purchase payments,
- issuance of the contracts, or
- commencement or continuance of annuity payments under the
contracts.
In addition, we will withhold taxes to the extent required by applicable law.
The State of New York does not currently assess a premium tax. In the
event New York does impose a premium tax, we reserve the right to charge you,
the contract owner. For non-New York residents, state premium taxes currently
range from 0% to 3.5% depending on the jurisdiction and the tax status of the
contract and are subject to change by the legislature or other authority.
EXPENSES OF DISTRIBUTING CONTRACTS
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MSS, the principal underwriter for the contracts, pays compensation to
selling brokers in varying amounts which under normal circumstances are not
expected to exceed 2.25% of purchase payments plus 1% of the contract value per
year commencing one year after each purchase payment. These expenses are not
assessed against the contracts but are instead paid by MSS. See "Distribution of
Contracts" for further information.
FEDERAL TAX MATTERS
INTRODUCTION
The following discussion of the Federal income tax treatment of the
contract is not exhaustive, does not purport to cover all situations, and is not
intended as tax advice. You should consult a qualified tax advisor with regard
to the application of the law to your circumstances. This discussion is based on
the Code, Treasury Department regulations, and interpretations existing on the
date of this Prospectus. These authorities, however, are subject to change by
Congress, the Treasury Department, and judicial decisions.
This discussion does not address state or local tax consequences
associated with the purchase of a contract. In addition, WE MAKE NO GUARANTEE
REGARDING ANY TAX TREATMENT -- FEDERAL, STATE, OR LOCAL -- OF ANY CONTRACT OR OF
ANY TRANSACTION INVOLVING A CONTRACT.
OUR TAX STATUS
We are taxed as a life insurance company. Because the operations of the
Variable Account are a part of, and are taxed with, our operations, the Variable
Account is not separately taxed as a "regulated investment company" under the
Code. Under existing Federal income tax laws, we are not taxed on the investment
income and capital gains of the Variable Account. We do not anticipate that we
will be taxed on the income and gains of the Variable Account, but if we are,
then we may impose a corresponding charge against the Variable Account.
TAXATION OF ANNUITIES IN GENERAL
Gains inside the contract are usually tax-deferred until you make a withdrawal,
start receiving annuity benefit payments, or receive a death benefit payment.
TAX DEFERRAL DURING ACCUMULATION PERIOD
Under existing provisions of the Code, except as described below, any
increase in the contract value is generally not taxable to the contract owner or
annuitant until received, either in the form of annuity payments, or in some
other form of distribution. Certain requirements must be satisfied in order for
this general rule to apply, including:
- the contract must be owned by an individual (or treated as
owned by an individual),
- the investments of the Variable Account must be "adequately
diversified" in accordance with Treasury Department
regulations,
- we, rather than the contract owner, must be considered the
owner of the assets of the Variable Account for federal tax
purposes, and
- the contract must provide for appropriate amortization,
through annuity benefit payments, of the contract's purchase
payment and earnings, e.g., the pay-out period must not occur
near the end of the annuitant's life expectancy.
NON-NATURAL OWNERS. As a general rule, deferred annuity contracts held
by "non-natural persons" (such as a corporation, trust or other similar entity)
are not treated as annuity contracts for Federal income tax purposes. The
investment income on such contracts is taxed as ordinary income that is received
or accrued by the owner of the contract during the taxable year. There are
several exceptions to this general rule for non-natural contract owners. First,
contracts will generally be treated as held by a natural person if the nominal
owner is a trust or other entity which holds the contract as an agent for a
natural person. This special exception will not apply, however, in the case of
any employer who is the nominal owner of an annuity contract under a
non-qualified deferred compensation arrangement for its employees.
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Exceptions to the general rule for non-natural contract owners will
also apply with respect to:
- contracts acquired by an estate of a decedent by reason of the
death of the decedent,
- certain qualified contracts,
- certain contracts purchased by employers upon the termination
of certain qualified plans,
- certain contracts used in connection with structured
settlement agreements, and
- contracts purchased with a single premium when the annuity
starting date (as defined in the tax law) is no later than a
year from purchase of the annuity and substantially equal
periodic payments are made, not less frequently than annually,
during the annuity period.
LOSS OF INTEREST DEDUCTION WHERE CONTRACTS ARE HELD BY OR FOR THE
BENEFIT OF CERTAIN NON-NATURAL PERSONS. In the case of contracts issued after
June 8, 1997 to a non-natural taxpayer (such as a corporation or a trust), or
held for the benefit of such an entity, otherwise deductible interest may not be
deductible by the entity, regardless of whether the interest relates to debt
used to purchase or carry the contract. However, this interest deduction
disallowance does not affect a contract if the income on the contract is treated
as ordinary income that is received or accrued by the owner during the taxable
year. Entities that are considering purchasing the contract, or entities that
will be beneficiaries under a contract, should consult a tax advisor.
DIVERSIFICATION REQUIREMENTS. For a contract to be treated as an
annuity for Federal income tax purposes, the investments of the Variable Account
must be "adequately diversified" in accordance with Treasury Department
Regulations. The Secretary of the Treasury has issued regulations which
prescribe standards for determining whether the investments of the Variable
Account are "adequately diversified." If the Variable Account failed to comply
with these diversification standards, a contract would not be treated as an
annuity contract for Federal income tax purposes and the contract owner would
generally be taxable currently on the excess of the contract value over the
premiums paid for the contract.
Although we do not control the investments of the Trust, we expect that
the Trust will comply with such regulations so that the Variable Account will be
considered "adequately diversified."
OWNERSHIP TREATMENT. In certain circumstances, a variable annuity
contract owner may be considered the owner, for Federal income tax purposes, of
the assets of the insurance company separate account used to support his or her
contract. In those circumstances, income and gains from such separate account
assets would be includible in the 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 owner possesses "incidents of
ownership" in those assets, such as the ability to exercise investment control
over the assets. In addition, the Treasury Department announced, in connection
with the issuance of regulations concerning investment diversification, that
those regulations "do not provide guidance concerning the circumstances in which
investor control of the investments of a segregated asset account may cause the
investor, 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 in the form of regulations or rulings on the "extent to which
Policyholders may direct their investments to particular sub-accounts of a
separate account without being treated as owners of the underlying assets." As
of the date of this Prospectus, no such guidance has been issued.
The ownership rights under this contract are similar to, but 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, the owner of this contract has the choice of many more investment
options to which to allocate premiums and contract values, and may be able to
transfer among investment options more frequently than in such rulings. THESE
DIFFERENCES COULD RESULT IN THE CONTRACT OWNER BEING TREATED AS THE OWNER OF THE
ASSETS OF THE VARIABLE ACCOUNT AND THUS SUBJECT TO CURRENT TAXATION ON THE
INCOME AND GAINS FROM THOSE ASSETS. In addition, we do not know what standards
will be set forth in the regulations or rulings which the Treasury Department
has stated it expects to issue. We therefore reserve the right to modify the
contract as necessary to attempt to prevent contract owners from being
considered the owners of the assets of the Variable Account.
DELAYED PAY-OUT PERIODS. If the contract's pay-out period commences (or
is scheduled to commence) at a time when the annuitant has reached an advanced
age, (e.g., past age 85), it is possible that
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the contract would not be treated as an annuity for Federal income tax purposes.
In that event, the income and gains under the contract could be currently
includible in the owner's income.
The remainder of this discussion assumes that the contract will be
treated as an annuity contract for Federal income tax purposes and that we will
be treated as the owner of the Variable Account assets.
TAXATION OF PARTIAL AND FULL WITHDRAWALS
In the case of a partial withdrawal, amounts received are includible in
income to the extent the contract value before the withdrawal exceeds the
"INVESTMENT IN THE CONTRACT." In the case of a full withdrawal, amounts received
are includible in income to the extent they exceed the investment in the
contract. For these purposes the investment in the contract at any time equals
the total of the purchase payments made under the contract to that time (to the
extent such payments were neither deductible when made nor excludible from
income as, for example, in the case of certain employer contributions to
qualified plans) less any amounts previously received from the contract which
were not included in income.
Other than in the case of certain qualified contracts, any amount
received as a loan under a contract, and any assignment or pledge (or agreement
to assign or pledge) any portion of the contract value, is treated as a
withdrawal of such amount or portion. (Loans, assignments and pledges are
permitted only in limited circumstances under qualified contracts.) The
investment in the contract is increased by the amount includible in income with
respect to such assignment or pledge, though it is not affected by any other
aspect of the assignment or pledge (including its release). If an individual
transfers his or her interest in an annuity contract without adequate
consideration to a person other than the owner's spouse (or to a former spouse
incident to divorce), the owner will be taxed on the difference between the
contract value and the investment in the contract at the time of transfer. In
such a case, the transferee's investment in the contract will be increased to
reflect the increase in the transferor's income.
There may be special income tax issues present in situations where the
owner and the annuitant are not the same person and are not married to one
another. A tax advisor should be consulted in those situations.
A portion of each annuity payment is usually taxable as ordinary income.
TAXATION OF ANNUITY BENEFIT PAYMENTS
Normally, a portion of each annuity benefit payment is taxable as
ordinary income. The taxable portion of an annuity benefit payment is equal to
the excess of the payment over the "EXCLUSION AMOUNT." In the case of variable
annuity payments, the exclusion amount is the investment in the contract
(defined above) allocated to the variable annuity option, adjusted for any
period certain or refund feature, when payments begin to be made divided by the
number of payments expected to be made (determined by Treasury Department
regulations which take into account the annuitant's life expectancy and the form
of annuity benefit selected). In the case of fixed annuity payments, the
exclusion amount is the amount determined by multiplying the payment by the
ratio of (a) to (b), where:
(a) is the investment in the contract allocated to the fixed
annuity option (adjusted for any period certain or refund
feature) and
(b) is the total expected value of fixed annuity payments for the
term of the contract (determined under Treasury Department
regulations).
A simplified method of determining the taxable portion of annuity payments
applies to contracts issued in connection with certain qualified plans other
than IRAs.
Once the total amount of the investment in the contract is excluded
using these ratios, annuity payments will be fully taxable. If annuity payments
cease because of the death of the annuitant and before the total amount of the
investment in the contract is recovered, the unrecovered amount generally will
be allowed as a deduction to the annuitant in his or her last taxable year.
TAXATION OF DEATH BENEFIT PROCEEDS
Amounts may be distributed from a contract because of the death of an
owner or the annuitant. During the accumulation period, death benefit proceeds
are includible in income as follows:
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- if distributed in a lump sum, they are taxed in the same
manner as a full withdrawal, as described above, or
- if distributed under an annuity option, they are taxed in the
same manner as annuity payments, as described above.
During the pay-out period, where a guaranteed period exists under an annuity
option and the annuitant dies before the end of that period, payments made to
the beneficiary for the remainder of that period are includible in income as
follows:
- if received in a lump sum, they are includible in income to
the extent that they exceed the unrecovered investment in the
contract at that time, or
- if distributed in accordance with the existing annuity option
selected, they are fully excludable from income until the
remaining investment in the contract is deemed to be
recovered, and all annuity payments thereafter are fully
includible in income.
Withdrawals prior to age 59-1/2 may incur a 10% penalty tax.
PENALTY TAX ON PREMATURE DISTRIBUTIONS
There is a 10% penalty tax on the taxable amount of any payment from a
non-qualified contract unless the payment is:
- received on or after the contract owner reaches age 59-1/2;
- attributable to the contract owner becoming disabled (as
defined in the tax law);
- made to a beneficiary on or after the death of the contract
owner or, if the contract owner is not an individual, on or
after the death of the primary annuitant (as defined in the
tax law);
- made as a series of substantially equal periodic payments (not
less frequently than annually) for the life (or life
expectancy) of the annuitant or for the joint lives (or joint
life expectancies) of the annuitant and designated beneficiary
(as defined in the tax law);
- made under an annuity contract purchased with a single premium
when the annuity starting date (as defined in the tax law) is
no later than a year from purchase of the annuity and
substantially equal periodic payments are made, not less
frequently than annually, during the annuity period; or
- made with respect to certain annuities issued in connection
with structured settlement agreements.
A similar penalty tax, applicable to distributions from certain qualified
contracts, is discussed below.
AGGREGATION OF CONTRACTS
In certain circumstances, the amount of an annuity payment or a
withdrawal from a contract that is includible in income may be determined by
combining some or all of the non-qualified contracts owned by an individual. For
example, if a person purchases a contract offered by this Prospectus and also
purchases at approximately the same time an immediate annuity, the IRS may treat
the two contracts as one contract. Similarly, if a person transfers part of his
interest in one annuity contract to purchase another annuity contract, the IRS
might treat the two contracts as one contract. In addition, if a person
purchases two or more deferred annuity contracts from the same insurance company
(or its affiliates) during any calendar year, all such contracts will be treated
as one contract. The effects of such aggregation are not clear; however, it
could affect the amount of a withdrawal or an annuity payment that is taxable
and the amount which might be subject to the penalty tax described above.
Consult your tax advisor for additional information.
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Special tax provisions apply to qualified plans. Consult your tax advisor prior
to using a contract with a qualified plan.
QUALIFIED RETIREMENT PLANS
The contracts are also designed for use in connection with certain
types of retirement plans which receive favorable treatment under the Code
("QUALIFIED PLANS"). Numerous special tax rules apply to the participants in
qualified plans and to the contracts used in connection with qualified plans.
Therefore, no attempt is made in this Prospectus to provide more than general
information about use of the contract with the various types of qualified plans.
Brief descriptions of various types of qualified plans in connection with which
we may issue a contract are contained in Appendix C to this Prospectus. Appendix
C also discusses certain potential tax consequences associated with the use of
the contract with certain qualified plans which should be considered by a
purchaser.
The tax rules applicable to qualified plans vary according to the type
of plan and the terms and conditions of the plan itself. For example, for both
withdrawals and annuity payments under certain qualified contracts, there may be
no "investment in the contract" and the total amount received may be taxable.
Also, loans from qualified contracts, where allowed, are subject to a variety of
limitations, including restrictions as to the amount that may be borrowed, the
duration of the loan, and the manner in which the loan must be repaid. (You
should always consult your tax advisor and retirement plan fiduciary prior to
exercising your loan privileges.) Both the amount of the contribution that may
be made, and the tax deduction or exclusion that you may claim for that
contribution, are limited under qualified plans. If you are considering the
purchase of a contract in connection with a qualified plan, you should consider,
in evaluating the suitability of the contract, that the contract requires a
minimum initial purchase payment of $25,000 and no additional purchase payments
are allowed. If this contract is used in connection with a qualified plan, the
owner and annuitant must be the same individual. If a co-annuitant is named, all
distributions made while the annuitant is alive must be made to the annuitant.
Also, if a co-annuitant is named who is not the annuitant's spouse, the annuity
options which are available may be limited, depending on the difference in ages
between the annuitant and co-annuitant. Furthermore, the length of any guarantee
period may be limited in some circumstances to satisfy certain minimum
distribution requirements under federal tax laws.
In addition, special rules apply to the time at which distributions
must commence and the form in which the distributions must be paid. For example,
failure to comply with minimum distribution requirements applicable to qualified
plans will result in the imposition of an excise tax. This excise tax generally
equals 50% of the amount by which a minimum required distribution exceeds the
actual distribution from the qualified plan. In the case of IRAs (other than
Roth IRAs), distributions of minimum amounts (as specified in the tax law) must
generally commence by April 1 of the calendar year following the calendar year
in which the owner attains age 70-1/2. In the case of certain other qualified
plans, distributions of such minimum amounts must generally commence by the
later of this date or April 1 of the calendar year following the calendar year
in which the employee retires.
There is also a 10% penalty tax on the taxable amount of any payment
from certain qualified contracts (but not Section 457 plans). (The amount of the
penalty tax is 25% of the taxable amount of any payment received from a "SIMPLE
retirement account" during the 2-year period beginning on the date the
individual first participated in any qualified salary reduction arrangement (as
defined in the tax law) maintained by the individual's employer.) There are
exceptions to this penalty tax which vary depending on the type of qualified
plan. In the case of an "Individual Retirement Annuity" or an "IRA," including a
"SIMPLE IRA," exceptions provide that the penalty tax does not apply to a
payment:
- received on or after the contract owner reaches age 59-1/2,
- received on or after the owner's death or because of the
owner's disability (as defined in the tax law), or
- made as a series of substantially equal periodic payments (not
less frequently than annually) for the life (or life
expectancy) of the owner or for the joint lives (or joint life
expectancies) of the owner and designated beneficiary (as
defined in the tax law).
These exceptions, as well as certain others not described herein, generally
apply to taxable distributions from other qualified plans (although, in the case
of plans qualified under Sections 401 and 403, the exception for substantially
equal periodic payments applies only if the owner has separated from service).
In addition, the penalty tax does not apply to certain distributions from IRAs
taken after December 31, 1997 which are used for qualified first time home
purchases or for higher education expenses. Special
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conditions must be met to qualify for these two exceptions to the penalty tax.
If you wish to take a distribution from an IRA for these purposes, you should
consult your tax advisor.
When issued in connection with a qualified plan, a contract will be
amended as generally necessary to conform to the requirements of the plan.
However, 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. In addition, we will not be bound by terms
and conditions of qualified plans to the extent those terms and conditions
contradict the contract, unless we consent.
DIRECT ROLLOVERS
If the contract is used in connection with a retirement plan that is
qualified under Sections 401(a), 403(a), or 403(b) of the Code, any "ELIGIBLE
ROLLOVER DISTRIBUTION" from the contract will be subject to "direct rollover"
and mandatory withholding requirements. An eligible rollover distribution
generally is any taxable distribution from such qualified plans, excluding
certain amounts such as (i) minimum distributions required under Section
401(a)(9) of the Code, and (ii) certain distributions for life, life expectancy,
or for 10 years or more which are part of a "series of substantially equal
periodic payments."
Under these requirements, Federal income tax equal to 20% of the
eligible rollover distribution will be withheld from the amount of the
distribution. Unlike withholding on certain other amounts distributed from the
contract, discussed below, the owner cannot elect out of withholding with
respect to an eligible rollover distribution. However, this 20% withholding will
not apply if, instead of receiving the eligible rollover distribution, the
person receiving the distribution elects to have it directly transferred to
certain qualified plans. Prior to receiving an eligible rollover distribution, a
notice will be provided explaining generally the direct rollover and mandatory
withholding requirements and how to avoid the 20% withholding by electing a
direct rollover.
LOANS
We offer a loan privilege only to owners of contracts issued in
connection with Section 403(b) qualified plans that are not subject to Title I
of ERISA. If you are not an owner of such a contract, none of this discussion
about loans applies to your contract. If you are an owner of such a contract,
you may borrow from us, using your contract as the only security for the loan.
Loans are subject to certain tax law restrictions and to applicable retirement
program rules (collectively, "LOAN RULES"). You should consult your tax advisor
and retirement plan fiduciary prior to taking a loan under the contract.
The maximum loan value of a contract is normally 80% of the contract
value, although loan rules may serve to reduce that maximum in some cases. The
amount available for a loan at any given time is the loan value less any unpaid
prior loans. Unpaid prior loans equal the amount of any prior loans plus
interest accrued on those loans. Loans will be made only upon written request
from the owner. We will make loans within seven days of receiving a properly
completed loan application (applications are available from our Annuity Service
Office), subject to postponement under the same circumstances that payment of
withdrawals may be postponed (see "WITHDRAWALS").
When you request a loan, we will reduce your investment in the
investment accounts and transfer the amount of the loan to the "LOAN ACCOUNT," a
part of our general account. You may designate the investment accounts from
which the loan is to be withdrawn. Absent such a designation, the amount of the
loan will be withdrawn from the investment accounts in accordance with the rules
for making partial withdrawals (see "WITHDRAWALS"). The contract provides that
you may repay unpaid loans at any time. Under applicable loan rules, loans
generally must be repaid within five years, repayments must be made at least
quarterly and repayments must be made in substantially equal amounts. When a
loan is repaid, the amount of the repayment will be transferred from the loan
account to the investment accounts. You may designate the investment accounts to
which a repayment is to be allocated. Otherwise, the repayment will be allocated
in the same manner as your most recent purchase payment. On each anniversary of
the date your contract was issued, we will transfer from the investment accounts
to the loan account the excess of the balance of your loan over the balance in
your loan account.
We charge interest of 6% per year on contract loans. Loan interest is
payable in arrears and, unless paid in cash, the accrued loan interest is added
to the amount of the debt and bears interest at 6% as well. We credit interest
with respect to amounts held in the loan account at a rate of 4% per year.
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Consequently, the net cost of loans under the contract is 2%. If on any date
unpaid loans under your contract exceed your contract value, your contract will
be in default. In such case you will receive a notice indicating the payment
needed to bring your contract out of default and will have a thirty-one day
grace period within which to pay the default amount. If the required payment is
not made within the grace period, your contract may be terminated without value.
The amount of any unpaid loans (including unpaid interest) will be
deducted from the death benefit otherwise payable under the contract. In
addition, loans, whether or not repaid, will have a permanent effect on contract
value because the investment results of the investment accounts will apply only
to the unborrowed portion of the contract value. The longer a loan is unpaid,
the greater the effect is likely to be. The effect could be favorable or
unfavorable. If the investment results are greater than the rate being credited
on amounts held in your loan account while your loan is unpaid, your contract
value will not increase as rapidly as it would have if no loan were unpaid. If
investment results are below that rate, contract value will be greater than it
would have been had no loan been outstanding.
We may be required to withhold amounts from some payments for Federal income tax
payments.
FEDERAL INCOME TAX WITHHOLDING
We will withhold and remit to the U.S. Government a part of the taxable
portion of each distribution made under a contract unless the person receiving
the distribution notifies us at or before the time of the distribution that he
or she elects not to have any amounts withheld. In certain circumstances, we may
be required to withhold tax. The withholding rates applicable to the taxable
portion of periodic annuity payments are the same as the withholding rates
generally applicable to payments of wages. In addition, the withholding rate
applicable to the taxable portion of non-periodic payments (including
withdrawals prior to the maturity date and rollovers from non-Roth IRAs to Roth
IRAs) is 10%. As discussed above, the withholding rate applicable to eligible
rollover distributions is 20%.
GENERAL MATTERS
We may advertise our investment performance.
PERFORMANCE DATA
Each of the sub-accounts may quote total return figures in its
advertising and sales materials. PAST PERFORMANCE FIGURES ARE NOT INTENDED TO
INDICATE FUTURE PERFORMANCE OF ANY SUB-ACCOUNT. The sub-accounts may advertise
both "standardized" and "non-standardized" total return figures. Standardized
figures will include average annual total return figures for one, five and ten
years, or from the inception date of the relevant sub-account of the Variable
Account (if that period since inception is shorter than one of those periods).
Non-standardized total return figures also may be quoted, including figures that
do not assume redemption at the end of the time period. Non-standardized figures
may also include total return numbers from the inception date of the portfolio
or ten years, whichever period is shorter. Where the period since inception is
less than one year, the total return quoted will be the aggregate return for the
period.
Average annual total return is the average annual compounded rate of
return that equates a purchase payment to the market value of that purchase
payment on the last day of the period for which the return is calculated. The
aggregate total return is the percentage change (not annualized) that equates a
purchase payment to the market value of such purchase payment on the last day of
the period for which the return is calculated. For purposes of the calculations
it is assumed that an initial payment of $1,000 is made on the first day of the
period for which the return is calculated. For total return figures quoted for
periods prior to the commencement of the offering of the contract, standardized
performance data will be the historical performance of the Trust portfolio from
the date the applicable sub-account of the Variable Account first became
available for investment under other contracts that we offer, adjusted to
reflect current contract charges. In the case of non-standardized performance,
performance figures will be the historical performance of the Trust portfolio
from the inception date of the portfolio (or in the case of the Trust portfolios
created in connection with the merger of Manulife Series Fund, Inc. into the
Trust, the inception date of the applicable predecessor Manulife Series Fund,
Inc. portfolio), adjusted to reflect current contract charges.
ASSET ALLOCATION AND TIMING SERVICES
We are aware that certain third parties are offering asset allocation
and timing services in connection with the contracts. In certain cases we have
agreed to honor transfer instructions from such asset allocation and timing
services where we have received powers of attorney, in a form acceptable to us,
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from the contract owners participating in the service. Where permitted by law,
we may accept your authorization for a third party to make transfers for you
subject to our rules. However, the contract is not designed for professional
market timing organizations or other entities or persons engaging in programmed,
frequent or large exchanges (collectively, "market timers") to speculate on
short-term movements in the market since such activity may be disruptive to the
Trust portfolios and increase their transaction costs. Therefore, in order to
prevent excessive use of the exchange privilege, we reserve the right to (a)
reject or restrict any specific purchase and exchange requests and (b) impose
specific limitations with respect to market timers, including restricting
exchanges by market timers to certain variable investment options (transfers by
market timers into or out of fixed investment options is not permitted). WE DO
NOT ENDORSE, APPROVE OR RECOMMEND SUCH SERVICES IN ANY WAY AND YOU SHOULD BE
AWARE THAT FEES PAID FOR SUCH SERVICES ARE SEPARATE AND IN ADDITION TO FEES PAID
UNDER THE CONTRACTS.
We pay broker-dealers to sell the contracts.
DISTRIBUTION OF CONTRACTS
MSS is a Delaware limited liability company that is controlled by
Manulife North America. We have a 10% equity interest in MSS. MSS is the
principal underwriter and exclusive distributor of the contracts. MSS also is
the investment adviser to the Trust. MSS is a broker-dealer registered under the
Securities Exchange Act of 1934, is a member of the National Association of
Securities Dealers and is duly appointed and licensed as our insurance agent.
MSS is located at 73 Tremont Street, Boston, Massachusetts 02108.
We have entered into an Underwriting and Distribution Agreement with
MSS where we appointed MSS the principal underwriter and exclusive
representative for the distribution of all insurance products and authorized MSS
to enter into agreements with selling broker-dealers and general agents for the
distribution of the products. Sales of the contracts will be made by registered
representatives of broker-dealers authorized by us and MSS to sell the
contracts. Those registered representatives will also be our licensed insurance
agents. MSS will pay distribution compensation to selling broker-dealers in
varying amounts which under normal circumstances are not expected to exceed
2.25% of purchase payments plus 1% of the contract value per year commencing one
year after each purchase payment.
CONTRACT OWNER INQUIRIES
Your inquiries should be directed to our Annuity Service Office mailing
address at The Manufacturers Life Insurance Company of New York, Annuity Service
Office, P.O. Box 9013, Boston, Massachusetts 02205-9013.
CONFIRMATION STATEMENTS
You will be sent confirmation statements for certain transactions in
your account. You should carefully review these statements to verify their
accuracy. Any mistakes should immediately be reported to our Annuity Service
Office. If you fail to notify our Annuity Service Office of any mistake within
60 days of the mailing of the confirmation statement, you will be deemed to have
ratified the transaction.
LEGAL PROCEEDINGS
There are no legal proceedings to which the Variable Account is a party
or to which the assets of the Variable Account are subject. Neither we nor MSS
are involved in any litigation that is of material importance to either, or that
relates to the Variable Account.
YEAR 2000 ISSUES
The Year 2000 Issue arises because many computerized systems use two digits
rather than four to identify a year. Date sensitive systems may recognize the
year 2000 as 1900 or some other date, resulting in errors when information using
year 2000 dates is processed. In addition, similar problems may arise in some
systems which use certain dates in 1999 to represent something other than a
date. Although the change in date has occurred, it is not possible to conclude
that all aspects of the Year 2000 Issue that May affect us, including those
related to customers, suppliers, or other third parties, have been fully
resolved.
CANCELLATION OF CONTRACT
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We may, at our option, cancel a contract at the end of any two
consecutive contract years in which no purchase payments by or on behalf of you,
have been made, if both:
- the total purchase payments made for the contract, less any
withdrawals, are less than $2,000; and
- the contract value at the end of such two year period is less
than $2,000.
We, as a matter of administrative practice, will attempt to notify you prior to
such cancellation in order to allow you to make the necessary purchase payment
to keep the contract in force.
VOTING INTEREST
As stated above under "The Trust", we will vote shares of the Trust
portfolios held in the Variable Account at the Trust's shareholder meetings
according to voting instructions received from the persons having the voting
interest under the contracts.
Accumulation Period. During the accumulation period, the contract owner
has the voting interest under a contract. The number of votes for each portfolio
for which voting instructions may be given is determined by dividing the value
of the investment account corresponding to the sub-account in which such
portfolio shares are held by the net asset value per share of that portfolio.
Pay-out Period. During the pay-out period, the annuitant has the voting
interest under a contract. The number of votes as to each portfolio for which
voting instructions may be given is determined by dividing the reserve for the
contract allocated to the sub-account in which such portfolio shares are held by
the net asset value per share of that portfolio.
Generally, the number of votes tends to decrease as annuity payments
progress since the amount of reserves attributable to a contract will usually
decrease after commencement of annuity payments. We will determine the number of
portfolio shares for which voting instructions may be given not more than 90
days prior to the meeting.
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APPENDIX A
SPECIAL TERMS
The following terms as used in this Prospectus have the indicated meanings:
ACCUMULATION PERIOD - The accumulation period is the period between the issue
date of the contract and the maturity date of the contract. During this period,
purchase payments are typically made by the owner.
ACCUMULATION UNIT - A unit of measure that is used to calculate the value of the
variable portion of the contract before the maturity date.
ANNUITANT - Any natural person or persons whose life is used to determine the
duration of annuity payments involving life contingencies. If the contract owner
names more than one person as an "annuitant," the second person named shall be
referred to as "co-annuitant." The "annuitant" and "co-annuitant" will be
referred to collectively as "annuitant." The "annuitant" is as designated on the
contract specification page or in the application, unless changed.
ANNUITY UNIT - A unit of measure that is used after the maturity date to
calculate variable annuity payments.
BENEFICIARY - The person, persons or entity entitled to the death benefit under
the contract upon the death of a contract owner or, in certain circumstances, an
annuitant. The beneficiary is as specified in the application, unless changed.
If there is a surviving contract owner, that person will be the beneficiary.
BUSINESS DAY - Any day on which the New York Stock Exchange is open for business
and the net asset value of a Trust portfolio may be determined.
THE CODE - The Internal Revenue Code of 1986, as amended.
CONTINGENT BENEFICIARY - The person, persons or entity to become the beneficiary
if the beneficiary is not alive. The contingent beneficiary is as specified in
the application, unless changed.
CONTRACT YEAR - The period of twelve consecutive months beginning on the date as
of which the contract is issued, or any anniversary of that date.
FIXED ANNUITY - An annuity option with payments the amount of which we
guarantee.
GENERAL ACCOUNT - All of our assets other than assets in separate accounts such
as the Variable Account.
INVESTMENT ACCOUNT - An account we establish for you which represents your
interest in an investment option during the accumulation period.
INVESTMENT OPTIONS - The investment choices available to contract owners.
Currently, there are thirty-eight variable and two fixed investment options
under the contract.
LOAN ACCOUNT - The portion of our general account that is used for collateral
for a loan.
MATURITY DATE - The date on which the pay-out period commences and we begin to
make annuity benefit payments to the annuitant. The maturity date is the date
specified on the contract specifications page and is generally the first day of
the month following the later of the annuitant's 85th birthday or the tenth
contract anniversary, unless changed. The maturity date will not be later than
the annuitant's 90th birthday.
NON-QUALIFIED CONTRACTS - Contracts which are not issued under qualified plans.
OWNER OR CONTRACT OWNER - The person, persons (co-owner) or entity entitled to
all of the ownership rights under the contract. References in this Prospectus to
contract owners are typically by use of "you." The owner has the legal right to
make all changes in contractual designations where specifically permitted by the
contract. The owner is as specified in the application, unless changed.
PAY-OUT PERIOD - The pay-out period is the period when we make annuity benefit
payments to you.
<PAGE> 39
PORTFOLIO OR TRUST PORTFOLIO - A separate investment portfolio of the Trust, a
mutual fund in which the Variable Account invests, or of any successor mutual
fund.
QUALIFIED CONTRACTS - Contracts issued under qualified plans.
QUALIFIED PLANS - Retirement plans which receive favorable tax treatment under
Section 401, 403, 408 or 408A, or 457 of the Code.
SUB-ACCOUNT(S) - One or more of the sub-accounts of the Variable Account. Each
sub-account is invested in shares of a different Trust portfolio.
UNPAID LOANS - The unpaid amounts (including any accrued interest) of loans some
contract owners may have taken from us, using certain qualified contracts as
collateral.
VALUATION PERIOD - Any period from one business day to the next, measured from
the time on each business day that the net asset value of each portfolio is
determined.
<PAGE> 40
APPENDIX B
TABLE OF ACCUMULATION UNIT VALUES
RELATING TO THE CONTRACT
<TABLE>
<CAPTION>
SUB-ACCOUNT UNIT VALUE AT UNIT VALUE AT NUMBER OF UNITS AT END OF
START OF YEAR(A) END OF YEAR YEAR
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Pacific Rim Emerging Markets
1998 $ 12.500000 $ 7.656925 0.000
1999 7.656925 12.267100 11,339.373
- ------------------------------------------------------------------------------------------------------------
Science & Technology
1998 $ 12.500000 $ 19.191525 0.000
1999 19.191525 37.660683 74,836.525
- ------------------------------------------------------------------------------------------------------------
International Small Cap
1998 $ 12.500000 $ 14.687879 0.000
1999 14.687879 26.718058 9,892.542
- ------------------------------------------------------------------------------------------------------------
Aggressive Growth
1998 $ 12.500000 $ 12.617679 0.000
1999 12.617679 16.504105 47,183.889
- ------------------------------------------------------------------------------------------------------------
Emerging Small Company
1998 $ 12.500000 $ 14.310172 0.000
1999 14.310172 24.427201 12,455.847
- ------------------------------------------------------------------------------------------------------------
Small Company Blend
1999 $ 12.500000 $ 15.895877 7,239.531
- ------------------------------------------------------------------------------------------------------------
Mid Cap Growth
1998 $ 12.500000 $ 18.869029 0.000
1999 18.869029 26.855000 40,628.907
- ------------------------------------------------------------------------------------------------------------
Mid Cap Stock
1999 $ 12.500000 $ 12.462837 24,423.970
- ------------------------------------------------------------------------------------------------------------
Overseas
1998 $ 12.500000 $ 12.168562 0.000
1999 12.168562 16.833813 26,270.772
- ------------------------------------------------------------------------------------------------------------
International Stock
1998 $ 12.500000 $ 14.265882 0.000
1999 14.265882 18.202233 15,681.838
- ------------------------------------------------------------------------------------------------------------
International Value
1999 $ 12.500000 $ 12.838100 13,081.628
- ------------------------------------------------------------------------------------------------------------
Mid Cap Blend
1998 $ 12.500000 $ 22.973151 448.588
1999 22.973151 28.867552 29,850.154
- ------------------------------------------------------------------------------------------------------------
Small Company Value
1998 $ 12.500000 $ 11.143828 0.000
1999 11.143828 11.83789 12,958.761
- ------------------------------------------------------------------------------------------------------------
Global Equity
1998 $ 12.500000 $ 18.706100 1,353.551
1999 18.706100 19.073534 28,618.022
- ------------------------------------------------------------------------------------------------------------
Growth
1998 $ 12.500000 $ 20.612746 0.000
1999 20.612746 27.818889 34,965.215
- ------------------------------------------------------------------------------------------------------------
Large Cap Growth
1998 $ 12.500000 $ 18.982681 0.000
1999 18.982681 23.393391 62,551.647
- ------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 41
<TABLE>
<CAPTION>
SUB-ACCOUNT UNIT VALUE AT UNIT VALUE AT NUMBER OF UNITS AT END OF
START OF YEAR(A) END OF YEAR YEAR
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Quantitative Equity
1998 $12.500000 $19.968902 0.000
1999 19.968902 24.022598 20,577.391
- ------------------------------------------------------------------------------------------------------------
Blue Chip Growth
1998 $12.500000 $22.573222 450.564
1999 22.573222 26.518360 136,324.720
- ------------------------------------------------------------------------------------------------------------
Real Estate Securities
1998 $12.500000 $12.255908 0.000
1999 12.255908 11.090818 3,789.517
- ------------------------------------------------------------------------------------------------------------
Value
1998 $12.500000 $14.519332 0.000
1999 14.519332 13.883152 29,002.081
- ------------------------------------------------------------------------------------------------------------
Growth & Income
1998 $12.500000 $26.056725 769.618
1999 26.056725 30.467742 155,039.214
- ------------------------------------------------------------------------------------------------------------
U.S. Large Cap Value
1999 $12.500000 $12.700198 42,362.048
- ------------------------------------------------------------------------------------------------------------
Equity-Income
1998 $12.500000 $20.794388 484.376
1999 20.794388 21.149570 53,745.789
- ------------------------------------------------------------------------------------------------------------
Income & Value
1998 $12.500000 $16.824988 0.000
1999 16.824988 17.986686 14,561.183
- ------------------------------------------------------------------------------------------------------------
Balanced
1998 $12.500000 $16.377624 0.000
1999 16.377624 15.843343 15,773.592
- ------------------------------------------------------------------------------------------------------------
High Yield
1998 $12.500000 $14.008370 1,070.053
1999 14.008370 14.881850 28,142.952
- ------------------------------------------------------------------------------------------------------------
Strategic Bond
1998 $12.500000 $14.243718 2,110.645
1999 14.243718 14.321908 13,538.080
- ------------------------------------------------------------------------------------------------------------
Global Bond
1998 $12.500000 $14.814388 0.000
1999 14.814388 13.599529 1,654.578
- ------------------------------------------------------------------------------------------------------------
Total Return
1999 $12.500000 12.235367 67,694.719
- ------------------------------------------------------------------------------------------------------------
Investment Quality Bond
1998 $12.500000 $13.299876 0.000
1999 13.299876 12.847911 33,537.825
- ------------------------------------------------------------------------------------------------------------
Diversified Bond
1998 $12.500000 $14.663990 0.000
1999 14.663990 14.527388 26,748.830
- ------------------------------------------------------------------------------------------------------------
U.S. Government Securities
1998 $12.500000 $12.999698 772.499
1999 12.999698 12.757839 25,710.833
- ------------------------------------------------------------------------------------------------------------
Money Market
1998 $12.500000 $11.811952 0.000
1999 11.811952 12.153141 125,080.921
- ------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 42
<TABLE>
<CAPTION>
SUB-ACCOUNT UNIT VALUE AT UNIT VALUE AT NUMBER OF UNITS AT END OF
START OF YEAR(A) END OF YEAR YEAR
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Lifestyle Aggressive 1000
1998 $12.500000 $14.064128 0.000
1999 14.064128 15.855076 11,343.154
- ------------------------------------------------------------------------------------------------------------
Lifestyle Growth 820
1998 $12.500000 $14.623605 0.000
1999 14.623605 16.767184 80,481.118
- ------------------------------------------------------------------------------------------------------------
Lifestyle Balanced 640
1998 $12.500000 $14.591457 0.000
1999 14.591457 16.136115 40,993.431
- ------------------------------------------------------------------------------------------------------------
Lifestyle Moderate 460
1998 $12.500000 $15.096548 0.000
1999 15.096548 16.021927 7,292.329
- ------------------------------------------------------------------------------------------------------------
Lifestyle Conservative 280
1998 $12.500000 $14.950846 0.000
1999 14.950846 15.324704 36,540.735
- ------------------------------------------------------------------------------------------------------------
</TABLE>
(A) Units under this series of contracts were first credited under the
sub-accounts on November 6, 1998, except in the case of the:
- - Small Company Blend, Mid Cap Stock, International Value, U.S. Large Cap
Value and Total Return Trusts where units were first credited on May 1,
1999.
<PAGE> 43
APPENDIX C
QUALIFIED PLAN TYPES
Set forth below are brief descriptions of the types of qualified plans
in connection with which we will issue contracts. Certain potential tax
consequences associated with use of the contract in connection with qualified
plans are also described. Persons intending to use the contract in connection
with qualified plans should consult their tax advisor.
INDIVIDUAL RETIREMENT ANNUITIES. Section 408 of the Code permits
eligible individuals to contribute to an individual retirement program known as
an "Individual Retirement Annuity" or "IRA." IRAs are subject to limits on the
amounts that may be contributed, the persons who may be eligible and on the time
when distributions may commence. Also, distributions from certain other types of
qualified retirement plans may be "rolled over" on a tax-deferred basis into an
IRA. The contract may not, however be used in connection with an "Education IRA"
under Section 530 of the Code.
IRAs generally may not provide life insurance coverage, but they may
provide a death benefit that equals the greater of the premiums paid and the
contract value. The contract provides a death benefit that in certain
circumstances may exceed the greater of the purchase payments and the contract
value. It is possible that the contract's death benefit could be viewed as
providing life insurance coverage with the result that the contract would not be
viewed as satisfying the requirements of an IRA.
Simplified Employee Pensions (SEP-IRAs). Section 408(k) of the Code
allows employers to establish simplified employee pension plans for their
employees, using the employees' IRAs for such purposes, if certain criteria are
met. Under these plans the employer may, within specified limits, make
deductible contributions on behalf of the employees to IRAs. As discussed above
(see Individual Retirement Annuities), there is some uncertainty regarding the
treatment of the contract's death benefit for purposes of the tax rules
governing IRAs (which would include SEP-IRAs).
SIMPLE IRAs. Section 408(p) of the Code permits certain small employers
to establish "SIMPLE retirement accounts," including SIMPLE IRAs, for their
employees. Under SIMPLE IRAs, certain deductible contributions are made by both
employees and employers. SIMPLE IRAs are subject to various requirements,
including limits on the amounts that may be contributed, the persons who may be
eligible, and the time when distributions may commence. As discussed above (see
Individual Retirement Annuities), there is some uncertainty regarding the proper
characterization of the contract's death benefit for purposes of the tax rules
governing IRAs (which would include SIMPLE IRAs).
Roth IRAs. Section 408A of the Code permits eligible individuals to
contribute to a type of IRA known as a "Roth IRA." Roth IRAs are generally
subject to the same rules as non-Roth IRAs, but differ in certain respects.
Among the differences is that contributions to a Roth IRA are not
deductible and "qualified distributions" from a Roth IRA are excluded from
income. A qualified distribution is a distribution that satisfies two
requirements. First, the distribution must be made in a taxable year that is at
least five years after the first taxable year for which a contribution to any
Roth IRA established for the owner was made. Second, the distribution must be:
- made after the owner attains age 59-1/2;
- made after the owner's death;
- attributable to the owner being disabled; or
- a qualified first-time homebuyer distribution within the
meaning of Section 72(t)(2)(F) of the Code.
In addition, distributions from Roth IRAs need not commence when the
owner attains age 70-1/2 . A Roth IRA may accept a "qualified rollover
contribution" from a non-Roth IRA, but a Roth IRA may not accept rollover
contributions from other qualified plans.
As described above (see "Individual Retirement Annuities"), there is
some uncertainty regarding the proper characterization of the contract's death
benefit for purposes of the tax rules governing IRAs (which include Roth IRAs).
Also, the state tax treatment of a Roth IRA may differ from the Federal income
tax treatment of a Roth IRA.
<PAGE> 44
Corporate and Self-Employed ("H.R. 10" and "Keogh") Pension and
Profit-Sharing Plans. Sections 401(a) and 403(a) of the Code permit corporate
employers to establish various types of tax-favored retirement plans for
employees. The Self-Employed Individuals' Tax Retirement Act of 1962, as
amended, commonly referred to as "H.R. 10" or "Keogh," permits self-employed
individuals also to establish such tax-favored retirement plans for themselves
and their employees. Such retirement plans may permit the purchase of the
contracts in order to provide benefits under the plans. The contract provides a
death benefit that in certain circumstances may exceed the greater of the
purchase payments and the contract value. It is possible that the IRS could
characterize the death benefit as an "incidental death benefit." There are
limitations on the amount of incidental benefits that may be provided under
pension and profit sharing plans. In addition, the provision of such benefits
may result in current taxable income to participants.
Tax-Sheltered Annuities. Section 403(b) of the Code permits public
school employees and employees of certain types of charitable, educational and
scientific organizations specified in Section 501(c)(3) of the Code to have
their employers purchase annuity contracts for them and, subject to certain
limitations, to exclude the amount of purchase payments from gross income for
tax purposes. These annuity contracts are commonly referred to as "tax-sheltered
annuities." Purchasers of the contracts for such purposes should seek competent
advice as to eligibility, limitations on permissible amounts of purchase
payments and other tax consequences associated with the contracts. In
particular, purchasers should consider that the contract provides a death
benefit that in certain circumstances may exceed the greater of the purchase
payments and the contract value. It is possible that the IRS could characterize
the death benefit as an "incidental death benefit." If so, the contract owner
could be deemed to receive currently taxable income. In addition, there are
limitations on the amount of incidental benefits that may be provided under a
tax-sheltered annuity. Even if the IRS characterized the benefit under the
contract as an incidental death benefit, the death benefit is unlikely to
violate those limits unless the purchaser also purchases a life insurance
contract as part of his or her tax-sheltered annuity plan.
Tax-sheltered annuity contracts must contain restrictions on
withdrawals of:
- contributions made pursuant to a salary reduction agreement in
years beginning after December 31, 1988,
- earnings on those contributions, and
- earnings after 1988 on amounts attributable to salary
reduction contributions (and earnings on those contributions)
held as of the last day of the year beginning before January
1, 1989.
These amounts can be paid only if the employee has reached age 59-1/2, separated
from service, died, or become disabled (within the meaning of the tax law), or
in the case of hardship (within the meaning of the tax law). Amounts permitted
to be distributed in the event of hardship are limited to actual contributions;
earnings thereon cannot be distributed on account of hardship. Amounts subject
to the withdrawal restrictions applicable to Section 403(b)(7) custodial
accounts may be subject to more stringent restrictions. (These limitations on
withdrawals do not apply to the extent we are directed to transfer some or all
of the contract value to the issuer of another tax-sheltered annuity or into a
Section 403(b)(7) custodial account.)
<PAGE> 45
PART B
INFORMATION REQUIRED IN A
STATEMENT OF ADDITIONAL INFORMATION
<PAGE> 46
- --------------------------------------------------------------------------------
STATEMENT OF ADDITIONAL INFORMATION
THE MANUFACTURERS LIFE INSURANCE COMPANY OF NEW YORK SEPARATE ACCOUNT A
- --------------------------------------------------------------------------------
of
THE MANUFACTURERS LIFE INSURANCE COMPANY OF NEW YORK
SINGLE PAYMENT INDIVIDUAL DEFERRED
COMBINATION FIXED AND VARIABLE ANNUITY CONTRACT
NON-PARTICIPATING
This Statement of Additional Information is not a Prospectus. It
contains information in addition to that described in the Prospectus and should
be read in conjunction with the Prospectus dated the same date as this Statement
of Additional Information. The Prospectus may be obtained by writing The
Manufacturers Life Insurance Company of New York, at the mailing address of the
Annuity Service Office at P.O. 9013, Boston, MA 02205-9013 or by telephoning
(800) 551-2078.
The date of this Statement of Additional Information is May 1, 2000.
The Manufacturers Life Insurance Company of New York
100 Summit Lake Drive
Valhalla, New York 10595
(877) 391-3748
- --------------------------------------------------------------------------------
NYVISION.SAI5/00
<PAGE> 47
STATEMENT OF ADDITIONAL INFORMATION
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
General Information and History.................................................................. 3
Performance Data................................................................................. 3
State Premium Taxes.............................................................................. 10
Services
Independent Auditors.................................................................... 10
Servicing Agent......................................................................... 11
Principal Underwriter................................................................... 11
Appendix A - State Premium Taxes................................................................. 12
Financial Statements............................................................................. 13
</TABLE>
2
<PAGE> 48
GENERAL INFORMATION AND HISTORY
The Manufacturers Life Insurance Company of New York Separate Account A
(the "VARIABLE ACCOUNT") is a separate investment account of The Manufacturers
Life Insurance Company of New York ("WE" or "US"). We are a stock life insurance
company organized under the laws of New York in 1992. Prior to October 1, 1997,
we were known as First North American Life Assurance Company. Our principal
office is located at 100 Summit Lake Drive, Second Floor, Valhalla, New York
10595. We are a wholly-owned subsidiary of The Manufacturers Life Insurance
Company of North America ("MANULIFE NORTH AMERICA"), a stock life insurance
company established in 1979 in Delaware. The ultimate parent of Manulife North
America is Manulife Financial Corporation ("MFC") based in Toronto, Ontario,
Canada. MFC is the holding company of The Manufacturers Life Insurance Company
and its subsidiaries, collectively known as Manulife Financial.
PERFORMANCE DATA
Each of the sub-accounts may in its advertising and sales materials
quote total return figures. The sub-accounts may advertise both "standardized"
and "non-standardized" total return figures, although standardized figures will
always accompany non-standardized figures. Non-standardized total return figures
may be quoted assuming both:
- - redemption at the end of the time period, and
- - not assuming redemption at the end of the time period.
Standardized figures include total return figures from:
- - the inception date of the sub-account of the Variable Account which
invests in the portfolio, or
- - ten years, whichever period is shorter.
Non-standardized figures include total return figures from:
- - inception date of the portfolio, or
- - ten years, whichever period is shorter.
Such figures will always include the average annual total return for
recent one year and, when applicable, five and ten year periods and, where less
than ten years, the inception date of the sub-account, in the case of
standardized returns, and the inception date of the portfolio, in the case of
non-standardized returns. Where the period since inception is less than one
year, the total return quoted will be the aggregate return for the period. The
average annual total return is the average annual compounded rate of return that
equates a purchase payment to the market value of such purchase payment on the
last day of the period for which such return is calculated. The aggregate total
return is the percentage change (not annualized) that equates a purchase payment
to the market value of such purchase payment on the last day of the period for
which such return is calculated. For purposes of the calculations it is assumed
that an initial payment of $1,000 is made on the first day of the period for
which the return is calculated.
In calculating standardized return figures, all recurring charges (all
asset charges -mortality and expense risk fees and administrative fees) are
reflected and the asset charges are reflected in changes in unit values.
Standardized total return figures will be quoted assuming redemption at the end
of the period. Non-standardized total return figures reflecting redemption at
the end of the time period are calculated on the same basis as the standardized
returns. Non-standardized total return figures not reflecting redemption at the
end of the time period are calculated on the same basis as the standardized
returns except that the calculations assume no redemption at the end of the
period and do not reflect deduction of the annual contract fee. We believe such
non-standardized figures not reflecting redemptions at the end of the time
period are useful to contract owners who wish to assess the performance of an
ongoing contract of the size that is meaningful to the individual contract
owner.
For total return figures quoted for periods prior to the commencement
of the offering of this contract, November 6, 1998, standardized performance
data will be the historical performance of the Trust portfolio from the
3
<PAGE> 49
date the applicable sub-account of the Variable Account first became available
for investment under other contracts offered by us; adjusted to reflect current
contract charges. In the case of non-standardized performance, performance
figures will be the historical performance of the Trust portfolio from the
inception date of the portfolio (or in the case of the Trust portfolios created
in connection with the merger of Manulife Series Fund, Inc. into the Trust, the
inception date of the applicable predecessor Manulife Series Fund, Inc.
portfolio), adjusted to reflect current contract charges.
STANDARDIZED AVERAGE ANNUAL TOTAL RETURN FIGURES
CALCULATED AS OF DECEMBER 31, 1999
<TABLE>
<CAPTION>
SINCE INCEPTION OR
10 YEARS, WHICHEVER INCEPTION
TRUST PORTFOLIO 1 YEAR 5 YEAR SHORTER DATE*
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Pacific Rim Emerging Markets 60.21% N/A -0.63% 01/01/97
- ------------------------------------------------------------------------------------------------------------------
Science & Technology 96.24% N/A 44.48% 01/01/97
- ------------------------------------------------------------------------------------------------------------------
International Small Cap 81.91% N/A 21.95% 03/04/96
- ------------------------------------------------------------------------------------------------------------------
Aggressive Growth 30.80% N/A 9.71% 01/01/97
- ------------------------------------------------------------------------------------------------------------------
Emerging Small Company 70.70% N/A 25.05% 01/01/97
- ------------------------------------------------------------------------------------------------------------------
Small Company Blend N/A N/A 27.17% 05/01/99
- ------------------------------------------------------------------------------------------------------------------
Mid Cap Growth 42.32% N/A 22.12% 03/04/96
- ------------------------------------------------------------------------------------------------------------------
Mid Cap Stock N/A N/A -0.30% 05/01/99
- ------------------------------------------------------------------------------------------------------------------
Overseas 38.34% N/A 11.03% 01/09/95
- ------------------------------------------------------------------------------------------------------------------
International Stock 27.59% N/A 13.36% 01/01/97
- ------------------------------------------------------------------------------------------------------------------
International Value N/A N/A 2.71% 05/01/99
- ------------------------------------------------------------------------------------------------------------------
Mid Cap Blend 25.66% 21.36% 17.54% 10/31/92
- ------------------------------------------------------------------------------------------------------------------
Small Company Value 6.23% N/A -2.39% 10/01/97
- ------------------------------------------------------------------------------------------------------------------
Global Equity 1.96% 9.43% 11.10% 10/31/92
- ------------------------------------------------------------------------------------------------------------------
Growth 34.96% N/A 25.99% 07/15/96
- ------------------------------------------------------------------------------------------------------------------
Large Cap Growth 23.24% 17.82% 13.41% 10/31/92
- ------------------------------------------------------------------------------------------------------------------
Quantitative Equity 20.30% N/A 24.35% 01/01/97
- ------------------------------------------------------------------------------------------------------------------
Blue Chip Growth 17.48% 23.36% 13.94% 12/11/92
- ------------------------------------------------------------------------------------------------------------------
Real Estate Securities -9.51% N/A -3.91% 01/01/97
- ------------------------------------------------------------------------------------------------------------------
Value -4.38% N/A 3.56% 01/01/97
- ------------------------------------------------------------------------------------------------------------------
Growth & Income 16.93% 23.90% 18.16% 10/31/92
- ------------------------------------------------------------------------------------------------------------------
U.S. Large Cap Value N/A N/A 1.60% 05/01/99
- ------------------------------------------------------------------------------------------------------------------
Equity-Income 1.71% 14.86% 12.25% 02/19/93
- ------------------------------------------------------------------------------------------------------------------
Income & Value 6.90% 12.11% 9.30% 10/31/92
- ------------------------------------------------------------------------------------------------------------------
Balanced -3.26% N/A 8.23% 01/01/97
- ------------------------------------------------------------------------------------------------------------------
</TABLE>
4
<PAGE> 50
<TABLE>
<S> <C> <C> <C> <C>
High Yield 6.24% N/A 5.99% 01/01/97
- ------------------------------------------------------------------------------------------------------------------
Strategic Bond 0.55% 7.67% 5.37% 02/19/93
- ------------------------------------------------------------------------------------------------------------------
Global Bond -8.20% 5.79% 5.23% 10/31/92
- ------------------------------------------------------------------------------------------------------------------
Total Return N/A N/A -2.12% 05/01/99
- ------------------------------------------------------------------------------------------------------------------
Investment Quality Bond -3.40% 5.75% 4.42% 10/31/92
- ------------------------------------------------------------------------------------------------------------------
Diversified Bond -0.93% 7.65% 6.01% 10/31/92
- ------------------------------------------------------------------------------------------------------------------
U.S. Government Securities -1.86% 5.06% 4.02% 10/31/92
- ------------------------------------------------------------------------------------------------------------------
Money Market 2.89% 3.38% 2.82% 10/31/92
- ------------------------------------------------------------------------------------------------------------------
Lifestyle Aggressive 1000 12.73% N/A 8.31% 01/07/97
- ------------------------------------------------------------------------------------------------------------------
Lifestyle Growth 820 14.66% N/A 10.36% 01/07/97
- ------------------------------------------------------------------------------------------------------------------
Lifestyle Balanced 640 10.59% N/A 8.95% 01/07/97
- ------------------------------------------------------------------------------------------------------------------
Lifestyle Moderate 460 6.13% N/A 8.69% 01/07/97
- ------------------------------------------------------------------------------------------------------------------
Lifestyle Conservative 280 2.50% N/A 7.08% 01/07/97
- ------------------------------------------------------------------------------------------------------------------
</TABLE>
* Inception date of the sub-account of the Variable Account which invests in the
portfolio.
5
<PAGE> 51
NON-STANDARDIZED AVERAGE ANNUAL TOTAL RETURN FIGURES
(ASSUMING REDEMPTION AT THE END OF THE TIME PERIOD)
CALCULATED AS OF DECEMBER 31, 1999
<TABLE>
<CAPTION>
SINCE INCEPTION OR
10 YEARS, INCEPTION DATE
TRUST PORTFOLIO 1 YEAR 5 YEAR WHICHEVER SHORTER OF PORTFOLIO
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Pacific Rim Emerging Markets* 57.21% 2.87% 1.61% 10/04/94
- ------------------------------------------------------------------------------------------------------------------
Science & Technology 93.24% N/A 44.00% 01/01/97
- ------------------------------------------------------------------------------------------------------------------
International Small Cap 78.91% N/A 21.95% 03/04/96
- ------------------------------------------------------------------------------------------------------------------
Aggressive Growth 27.80% N/A 8.88% 01/01/97
- ------------------------------------------------------------------------------------------------------------------
Emerging Small Company 67.70% N/A 24.40% 01/01/97
- ------------------------------------------------------------------------------------------------------------------
Small Company Blend N/A N/A 24.17% 05/01/99
- ------------------------------------------------------------------------------------------------------------------
Mid Cap Growth 39.32% N/A 22.12% 03/04/96
- ------------------------------------------------------------------------------------------------------------------
Mid Cap Stock N/A N/A -2.99% 05/01/99
- ------------------------------------------------------------------------------------------------------------------
Overseas 35.34% N/A 11.03% 01/09/95
- ------------------------------------------------------------------------------------------------------------------
International Stock 24.59% N/A 12.57% 01/01/97
- ------------------------------------------------------------------------------------------------------------------
International Value N/A N/A -0.07% 05/01/99
- ------------------------------------------------------------------------------------------------------------------
Mid Cap Blend 22.66% 21.36% 12.15%+ 06/18/85
- ------------------------------------------------------------------------------------------------------------------
Small Company Value 3.34% N/A -3.56% 10/01/97
- ------------------------------------------------------------------------------------------------------------------
Global Equity -0.79% 9.43% 6.96%+ 03/18/88
- ------------------------------------------------------------------------------------------------------------------
Growth 31.96% N/A 25.99% 07/15/96
- ------------------------------------------------------------------------------------------------------------------
Large Cap Growth 20.24% 17.82% 10.95%+ 08/03/89
- ------------------------------------------------------------------------------------------------------------------
Quantitative Equity* 17.30% 23.00% 14.07%+ 04/30/87
- ------------------------------------------------------------------------------------------------------------------
Blue Chip Growth 14.48% 23.36% 13.94% 12/11/92
- ------------------------------------------------------------------------------------------------------------------
Real Estate Securities* -11.92% 5.38% 8.83%+ 4/30/87
- ------------------------------------------------------------------------------------------------------------------
Value -6.95% N/A 2.62% 01/01/97
- ------------------------------------------------------------------------------------------------------------------
Growth & Income 13.93% 23.90% 16.53% 04/23/91
- ------------------------------------------------------------------------------------------------------------------
U.S. Large Cap Value N/A N/A -1.15% 05/01/99
- ------------------------------------------------------------------------------------------------------------------
Equity-Income -1.04% 14.86% 12.25% 02/19/93
- ------------------------------------------------------------------------------------------------------------------
Income & Value 4.00% 12.11% 8.07%+ 08/03/89
- ------------------------------------------------------------------------------------------------------------------
Balanced -5.86% N/A 7.37% 01/01/97
- ------------------------------------------------------------------------------------------------------------------
High Yield 3.35% N/A 5.09% 01/01/97
- ------------------------------------------------------------------------------------------------------------------
Strategic Bond -2.17% 7.67% 5.37% 02/19/93
- ------------------------------------------------------------------------------------------------------------------
Global Bond -10.65% 5.79% 6.29%+ 03/18/88
- ------------------------------------------------------------------------------------------------------------------
</TABLE>
6
<PAGE> 52
<TABLE>
<CAPTION>
SINCE INCEPTION OR
10 YEARS, INCEPTION DATE
TRUST PORTFOLIO 1 YEAR 5 YEAR WHICHEVER SHORTER OF PORTFOLIO
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Total Return N/A N/A -4.75% 05/01/99
- ------------------------------------------------------------------------------------------------------------------
Investment Quality Bond -6.00% 5.75% 4.45%+ 06/18/85
- ------------------------------------------------------------------------------------------------------------------
Diversified Bond -3.60% 7.65% 5.73%+ 08/03/89
- ------------------------------------------------------------------------------------------------------------------
U.S. Government Securities -4.50% 5.06% 5.12%+ 03/18/88
- ------------------------------------------------------------------------------------------------------------------
Money Market 0.10% 3.38% 3.17%+ 06/18/85
- ------------------------------------------------------------------------------------------------------------------
Lifestyle Aggressive 1000 9.73% N/A 7.45% 01/07/97
- ------------------------------------------------------------------------------------------------------------------
Lifestyle Growth 820 11.66% N/A 9.53% 01/07/97
- ------------------------------------------------------------------------------------------------------------------
Lifestyle Balanced 640 7.59% N/A 8.10% 01/07/97
- ------------------------------------------------------------------------------------------------------------------
Lifestyle Moderate 460 3.25% N/A 7.83% 01/07/97
- ------------------------------------------------------------------------------------------------------------------
Lifestyle Conservative 280 -0.27% N/A 6.20% 01/07/97
- ------------------------------------------------------------------------------------------------------------------
</TABLE>
+ Ten year average annual return.
* Performance for each of these sub-accounts is based upon the historical
performance of the portfolio, adjusted to reflect current contract charges.
On December 31, 1996, Manulife Series Fund, Inc. merged with the Trust.
Performance for each of these sub-accounts is based on the historical
performance of the respective predecessor Manulife Series Fund, Inc.
portfolio for periods prior to December 31, 1996.
7
<PAGE> 53
NON-STANDARDIZED AVERAGE ANNUAL TOTAL RETURN FIGURES
(ASSUMING NO REDEMPTION AT THE END OF THE TIME PERIOD)
CALCULATED AS OF DECEMBER 31, 1999
<TABLE>
<CAPTION>
SINCE INCEPTION OR
10 YEARS, INCEPTION DATE
TRUST PORTFOLIO 1 YEAR 5 YEAR WHICHEVER SHORTER OF PORTFOLIO
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Pacific Rim Emerging Markets* 60.21% 15.21% 8.71% 10/04/94
- ------------------------------------------------------------------------------------------------------------------
Science & Technology 96.24% N/A 201.29% 01/01/97
- ------------------------------------------------------------------------------------------------------------------
International Small Cap 81.91% N/A 113.74% 03/04/96
- ------------------------------------------------------------------------------------------------------------------
Aggressive Growth 30.80% N/A 32.03% 01/01/97
- ------------------------------------------------------------------------------------------------------------------
Emerging Small Company 70.70% N/A 95.42% 01/01/97
- ------------------------------------------------------------------------------------------------------------------
Small Company Blend N/A N/A 27.17% 05/01/99
- ------------------------------------------------------------------------------------------------------------------
Mid Cap Growth 42.32% N/A 114.84% 03/04/96
- ------------------------------------------------------------------------------------------------------------------
Mid Cap Stock N/A N/A -0.30% 05/01/99
- ------------------------------------------------------------------------------------------------------------------
Overseas 38.34% N/A 68.34% 01/09/95
- ------------------------------------------------------------------------------------------------------------------
International Stock 27.59% N/A 45.62% 01/01/97
- ------------------------------------------------------------------------------------------------------------------
International Value N/A N/A 2.71% 05/01/99
- ------------------------------------------------------------------------------------------------------------------
Mid Cap Blend 25.66% 163.25% 214.87%+ 06/18/85
- ------------------------------------------------------------------------------------------------------------------
Small Company Value 6.23% N/A -5.30% 10/01/97
- ------------------------------------------------------------------------------------------------------------------
Global Equity 1.96% 56.94% 95.97%+ 03/18/88
- ------------------------------------------------------------------------------------------------------------------
Growth 34.96% N/A 122.55% 07/15/96
- ------------------------------------------------------------------------------------------------------------------
Large Cap Growth 23.24% 127.04% 182.59%+ 08/03/89
- ------------------------------------------------------------------------------------------------------------------
Quantitative Equity* 20.30% 181.53% 273.01%+ 04/30/87
- ------------------------------------------------------------------------------------------------------------------
Blue Chip Growth 17.48% 185.73% 151.22% 12/11/92
- ------------------------------------------------------------------------------------------------------------------
Real Estate Securities* -9.51% 29.97% 133.11%+ 04/30/87
- ------------------------------------------------------------------------------------------------------------------
Value -4.38% N/A 11.07% 01/01/97
- ------------------------------------------------------------------------------------------------------------------
Growth & Income 16.93% 191.94% 278.25% 04/23/91
- ------------------------------------------------------------------------------------------------------------------
U.S. Large Cap Value N/A N/A 1.60% 05/01/99
- ------------------------------------------------------------------------------------------------------------------
Equity-Income 1.71% 99.94% 121.05% 02/19/93
- ------------------------------------------------------------------------------------------------------------------
Income & Value 6.90% 77.10% 117.39%+ 08/03/89
- ------------------------------------------------------------------------------------------------------------------
Balanced -3.26% N/A 26.75% 01/01/97
- ------------------------------------------------------------------------------------------------------------------
High Yield 6.24% N/A 19.05% 01/01/97
- ------------------------------------------------------------------------------------------------------------------
Strategic Bond 0.55% 44.70% 43.22% 02/19/93
- ------------------------------------------------------------------------------------------------------------------
Global Bond -8.20% 32.52% 84.03%+ 03/18/88
- ------------------------------------------------------------------------------------------------------------------
</TABLE>
8
<PAGE> 54
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Total Return N/A N/A -2.12% 05/01/99
- ------------------------------------------------------------------------------------------------------------------
Investment Quality Bond -3.40% 32.26% 54.63%+ 06/18/85
- ------------------------------------------------------------------------------------------------------------------
Diversified Bond -0.93% 44.55% 74.65%+ 08/03/89
- ------------------------------------------------------------------------------------------------------------------
U.S. Government Securities -1.86% 27.98% 64.73%+ 03/18/88
- ------------------------------------------------------------------------------------------------------------------
Money Market 2.89% 18.10% 36.57%+ 06/18/85
- ------------------------------------------------------------------------------------------------------------------
Lifestyle Aggressive 1000 12.73% N/A 26.87% 01/07/97
- ------------------------------------------------------------------------------------------------------------------
Lifestyle Growth 820 14.66% N/A 34.17% 01/07/97
- ------------------------------------------------------------------------------------------------------------------
Lifestyle Balanced 640 10.59% N/A 29.12% 01/07/97
- ------------------------------------------------------------------------------------------------------------------
Lifestyle Moderate 460 6.13% N/A 28.20% 01/07/97
- ------------------------------------------------------------------------------------------------------------------
Lifestyle Conservative 280 2.50% N/A 22.63% 01/07/97
- ------------------------------------------------------------------------------------------------------------------
</TABLE>
+Ten year average annual return.
*Performance for each of these sub-accounts is based upon the historical
performance of the portfolio, adjusted to reflect current contract charges. On
December 31, 1996, Manulife Series Fund, Inc. merged with the Trust. Performance
for each of these sub-accounts is based on the historical performance of the
respective predecessor Manulife Series Fund, Inc. portfolio for periods prior to
December 31, 1996.
* * * * *
In addition to the non-standardized returns quoted above, each of the
sub-accounts may from time to time quote aggregate non-standardized total
returns calculated in the same manner as set forth above for other time periods.
From time to time the Trust may include in its advertising and sales literature
general discussions of economic theories, including but not limited to,
discussions on how demographic and political trends can affect the financial
markets. Further, the Trust may also include in its advertising and sales
literature specific information on each of the Trust's subadvisers, including
but not limited to, research capabilities of a subadviser, assets under
management, information relating to other clients of a subadviser, and other
generalized information.
STATE PREMIUM TAXES
New York does not currently assess a premium tax. In the event New York
does impose a premium tax, we reserve the right to pass-through such tax to
contract owners.
SERVICES
INDEPENDENT AUDITORS
The financial statements of the Company at December 31, 1999 and 1998
and for the three years in the period ended December 31, 1999 and of the
Variable Account at December 31, 1999 and for the two years in the period then
ended December 31, 1999 appearing in this Statement of Additional Information
have been audited by Ernst & Young LLP, independent auditors, as set forth in
their reports thereon appearing elsewhere herein, and are included in reliance
upon such reports given upon the authority of such firm as experts in accounting
and auditing.
Our financial statements which are included in the Statement of
Additional Information should be considered only as bearing on our ability to
meet our obligations under the contracts. They should not be considered as
bearing on the investment performance of the assets held in the Variable
Account.
9
<PAGE> 55
SERVICING AGENT
Computer Sciences Corporation Financial Services Group ("CSC FSG")
provides us a computerized data processing recordkeeping system for variable
annuity administration. CSC FSG provides various daily, semimonthly, monthly,
semiannual and annual reports including:
- daily updates on:
- accumulation unit values,
- variable annuity participants and transactions, and
- agent production and commissions;
- semimonthly commission statements;
- monthly summaries of agent production and daily transaction
reports;
- semiannual statements for contract owners; and
- annual contract owner tax reports.
We pay CSC FSG approximately $7.80 per policy per year, plus certain other fees
for the services provided.
PRINCIPAL UNDERWRITER
Manufacturers Securities Services, LLC, ("MSS") the successor to NASL
Financial Services, Inc., is a Delaware limited liability company controlled by
Manulife North America. MSS serves as principal underwriter of the contracts.
Contracts are offered on a continuous basis. The aggregate dollar amount of
underwriting commissions paid to MSS in 1999, 1998 and 1997 was $15,407,826,
$12,640,836 and $3,222,530, respectively. MSS did not retain any of these
amounts during such periods.
10
<PAGE> 56
APPENDIX A
STATE PREMIUM TAXES
Premium taxes vary according to the state and are subject to change. In
many jurisdictions there is no tax at all. For current information, a tax
advisor should be consulted.
<TABLE>
<CAPTION>
TAX RATE
--------
QUALIFIED NON-QUALIFIED
STATE CONTRACTS CONTRACTS
- ----- --------- ---------
<S> <C> <C>
CALIFORNIA .50% 2.35%
DISTRICT OF COLUMBIA 2.25% 2.25%
MAINE .00 2.00%
NEVADA .00 3.50%
PUERTO RICO 1.00% 1.00%
SOUTH DAKOTA* .00 1.25%
WEST VIRGINIA 1.00% 1.00%
WYOMING .00 1.00%
</TABLE>
* Premium tax paid upon receipt of premium (no tax at annuitization if tax paid
on premium at issue).
11
<PAGE> 57
FINANCIAL STATEMENTS
12
<PAGE> 58
PART C
OTHER INFORMATION
<PAGE> 59
Item 24. Financial Statements and Exhibits
Guide to Name Changes and Successions:
The following name changes took place October 1, 1997:
<TABLE>
<CAPTION>
Old Name New Name
<S> <C>
FNAL Variable Account The Manufacturers Life Insurance Company of New York
Separate Account A
First North American Life Assurance Company The Manufacturers Life Insurance Company of New York
The following name changes took place November 1, 1997:
Old Name New Name
NAWL Holding Co., Inc. Manulife-Wood Logan Holding Co., Inc.
The following name changes took place September 24, 1999:
Old Name New Name
Wood Logan Associates, Inc. Manulife Wood Logan, Inc.
</TABLE>
On September 30, 1997, Manufacturers Securities Services, LLC succeeded
to the business of NASL Financial Services, Inc.
* * * * *
(a) Financial Statements
(1) Financial Statements of the Registrant, The
Manufacturers Life Insurance Company of New York
Separate Account A (Part B of the registration
statement) - TO BE FILED BY AMENDMENT
(2) Financial Statements of the Depositor, The
Manufacturers Life Insurance Company of New York
(Part B of the registration statement) - TO BE FILED
BY AMENDMENT.
(b) Exhibits
(1) (a) Resolution of the Board of Directors of First
North American Life Assurance Company establishing
the FNAL Variable Account - Incorporated by reference
to Exhibit (b)(1)(a) to Form N-4, file number
33-46217, filed February 25, 1998.
(b) Resolution of the Board of Directors of First North
American Life Assurance Company establishing the
Fixed Separate Account - Incorporated by reference to
Exhibit (b)(1)(b) to Form N-4, file number 33-46217,
filed February 25, 1998.
(c) Resolution of the Board of Directors of First North
American Life Assurance Company establishing The
Manufacturers Life Insurance Company of New York
Separate Account D and The Manufacturers Life
Insurance Company of New York Separate Account E
Incorporated by reference to Exhibit (b)(1)(c) to
Form N-4, file number 33-46217, filed February 25,
1998.
<PAGE> 60
(2) Agreements for custody of securities and similar investments.- Not
Applicable.
(3) (a) Underwriting Agreement between Manufacturers Life
Insurance Company of New York (Depositor) and
Manufacturers Securities Services, LLC (Underwriter)
- Incorporated by reference to Exhibit (b)(3)(a) to
Form N-4, file number 33-46217, filed February 25,
1998.
(b) Selling Agreement between The Manufacturers Life
Insurance Company of New York, Manufactures
Securities Services, LLC (Underwriter), Selling
Broker Dealers, and General Agent - Incorporated by
reference to Exhibit (b)(3)(b) to Form N-4, file
number 33-46217, filed February 25, 1998.
(4) (a) Specimen Single Purchase Payment Individual
Deferred Combination Fixed and Variable Annuity
Contract, Non-Participating - Previously filed as
Exhibit (b)(4)(a) to the initial registration
statement to Form N-4 filed August 12, 1998.
(b) Specimen Endorsements to Contract: (i) ERISA Tax
Sheltered Annuity Endorsement; (ii) Tax-sheltered
Annuity Endorsement; (iii) Qualified Plan Endorsement
Section 401 Plans, (iv) Simple Individual Retirement
Annuity Endorsement; (v) Unisex Benefits and Payments
Endorsement; (vi) Individual Retirement Annuity
Endorsement - Previously filed as Exhibit (b)(4)(b)
to the initial registration statement to Form N-4
filed August 12, 1998.
(5) Specimen Application for Single Purchase Payment Individual
Deferred Combination Fixed and Variable Annuity Contract,
Non-Participating - Filed Herein.
(6) (a)(i) Declaration of Intention and Charter of First
North American Life Assurance Company Incorporated by
reference to Exhibit (b)(6)(a)(i) to Form N-4, file
number 33-46217, filed February 25, 1998.
(a)(ii) Certificate of amendment of the Declaration of
Intention and Charter of First North American Life
Assurance Company - Incorporated by reference to
Exhibit (b)(6)(a)(ii) to Form N-4, file number
33-46217, filed February 25, 1998.
(a)(iii) Certificate of amendment of the Declaration of
Intention and Charter of The Manufacturers Life
Insurance Company of New York - Incorporated by
reference to Exhibit (b)(6)(a)(iii) to Form N-4, file
number 33-46217, filed February 25, 1998.
(b) By-laws of The Manufacturers Life Insurance Company
of New York - Incorporated by reference to Exhibit
(b)(6)(b) to Form N-4, file number 33-46217, filed
February 25, 1998.
(7) Contract of reinsurance in connection with the variable
annuity contracts being offered - Not Applicable.
2
<PAGE> 61
(8) Other material contracts not made in the ordinary course of
business which are to be performed in whole or in part on or
after the date the registration statement is filed:
(a) Administrative Agreement between The Manufacturers
Life Insurance Company of New York and The
Manufacturers Life Insurance Company - Incorporated
by reference to Exhibit (b)(8)(a) to Form N-4, file
number 33-46217, filed February 25, 1998.
(b) Investment Services Agreement between The
Manufacturers Life Insurance Company of New York and
The Manufacturers Life Insurance Company -
Incorporated by reference to Exhibit 1(A)(8)(c) to
Form S-6, file number 333-33351, filed March 16,
1998.
(9) Opinion of Counsel and consent to its use as to the legality
of the securities being registered - Previously filed as
Exhibit (b)(9) to pre-effective amendment no. 1 to Form N-4,
filed November 4, 1998.
(10) Written consent of Ernst & Young LLP, independent auditors -
To Be Filed By Ammendment
(11) All financial statements omitted from Item 23, Financial
Statements - Not Applicable.
(12) Agreements in consideration for providing initial capital
between or among Registrant, Depositor, Underwriter or initial
contract owners - Not Applicable.
(13) Schedule for computation of each performance quotation
provided in the Registration Statement in response to Item 21
- Incorporated by reference to Exhibit (b)(13) to Form N-4,
33-76162 filed March 1, 1996.
(14) a) Power of Attorney - The Manufacturers Life
Insurance Company of New York Directors -
Incorporated by reference to Exhibit (7) to Form S-6,
file number 333-33351, filed March 16, 1998.
(b) Power of Attorney, James O'Malley and Thomas Borshoff
- Incorporated by reference to Exhibit (b)(14)(b) to
Form N-4, file number 33-79112, filed March 2, 1999.
(c) Power of Attorney, James D. Gallagher and James R.
Boyle - Incorporated by reference to Exhibit (7)(iii)
to Form S-6, file number 333-83023, filed November 1,
1999.
(d) Power of Attorney, Robert Cook - Incorporated by
reference to Exhibit (14)(e) to Form N-4, file number
33-79112, filed February __, 2000
Item 25. Directors and Officers of the Depositor.
3
<PAGE> 62
Officers and Directors of THE MANUFACTURERS LIFE INSURANCE COMPANY OF NEW YORK
<TABLE>
<CAPTION>
NAME AND PRINCIPAL POSITION WITH THE MANUFACTURERS LIFE
BUSINESS ADDRESS INSURANCE COMPANY OF NEW YORK
- ---------------- -----------------------------
<S> <C>
John D. Richardson Director and Chairman
200 Bloor Street East
North Tower 11
Toronto, Ontario
Canada M4W-1E5
Bruce Avedon Director
6601 Hitching Post Lane
Cincinnati, OH 45230
Thomas Borshoff Director
3 Robin Drive
Rochester, NY 14618
James R. Boyle Director
500 Boylston Street
Boston, MA 02116
Robert Cook Director
73 Tremont Street
Boston, MA 02108
John D. DesPrez III Director
73 Tremont Street
Boston, MA 02108
Ruth Ann Fleming Director
205 Highland Avenue
Short Hills, NJ 07078
James D. Gallagher Director & President
73 Tremont Street
Boston, MA 02108
Neil M. Merkl, Esq. Director
35-35 161st Street
Flushing, NY 11358
James P. O'Malley Director and VP-Pensions
Marketing
200 Bloor Street East
</TABLE>
4
<PAGE> 63
<TABLE>
<S> <C>
Toronto, Ontario
Canada M4W-1E5
James K. Robinson Director
7 Summit Drive
Rochester, NY 14620-3127
Tracy Anne Kane Secretary and Counsel
73 Tremont Street
Boston, MA 02108
David W. Libbey Treasurer
500 Boylston Street
Boston, MA 02116
E. Paige Sabine Assistant Vice President & Chief
73 Tremont Street Administrative Officer
Boston, MA 02108
</TABLE>
Item 26. Persons Controlled by or Under Common Control with Depositor or
Registrant.
MANULIFE FINANCIAL CORPORATION
Corporate Organization as at December 31, 1999
Manulife Financial Corporation (Canada)
The Manufacturers Life Insurance Company (Canada)
1. Manulife Data Services Inc. - Barbados (100%)
2. MF Leasing (Canada) Inc. - Ontario (100%)
2.1 1332953 Ontario Inc. - Ontario (100%)
3. Enterprise Capital Management Inc. - Ontario (20%)
4. Cantay Holdings Inc. - Canada (100%)
5. 994744 Ontario Inc. - Ontario (100%)
6. 3426505 Canada Inc. - Canada (100%)
7. Family Realty First Corp. - Ontario (100%)
5
<PAGE> 64
8. Manulife Bank of Canada - Canada (100%)
9. Manulife Securities International Ltd. - Canada (100%)
10. NAL Resources Limited - Alberta (100%)
11. Manulife International Capital Corporation Limited - Ontario (100%)
11.1. Golf Town Canada Inc. - Canada (100%)
11.2. Regional Power Inc. - Ontario (100%)
11.2.1. Addalam Power Corporation - Philippines
11.2.2. La Regionale Power Angliers Inc. - Canada (100%)
11.2.3. La Regionale Power Port-Cartier Inc. - Canada (100%)
11.3. VFC Inc. - Canada (100%)
11.4. 1198184 Ontario Limited - Ontario (100%)
12. 1293319 Ontario Inc. - Ontario (100%)
13. FNA Financial Inc. - Canada (100%)
13.1. Elliott & Page Limited - Ontario (100%)
13.2. Seamark Asset Management Ltd. - Canada (67.86%)
13.3. NAL Resources Management Limited - Canada (100%)
13.3.1. Caravan Oil & Gas Ltd. - Alberta (12.2%)
13.3.2. Carrack Energy Inc. - Alberta (16%)
13.4. First North American Insurance Company - Canada (100%)
14. MLI Resources Inc. - Alberta (100%)
15. Stylus Exploration Inc. - Alberta (100%)
16. Manucab Ltd. - Canada (100%)
16.1. Plazcab Service Limited - Newfoundland (100%)
17. The Manufacturers Investment Corporation - Michigan (100%)
17.1. Manulife Reinsurance Corporation (U.S.A.) - Michigan (100%)
17.1.1. Manulife Reinsurance Limited - Bermuda (100%)
17.1.1.1. MRL Holding, LLC - Delaware (99%)
17.1.2. MRL Holding, LLC - Delaware (1%)
17.1.2.1. Manulife-Wood Logan Holding Co. Inc. - Delaware
(22.4%)
17.1.3. The Manufacturers Life Insurance Company (U.S.A.) -
Michigan (100%)
17.1.3.1. Manulife-Wood Logan Holding Co. Inc. - Delaware
(77.6%)
17.1.3.1.1. Manulife Wood Logan, Inc. - Connecticut (100%)
6
<PAGE> 65
17.1.3.1.2. The Manufacturers Life Insurance Company of
North America - Delaware (100%)
17.1.3.1.2.1. Manufacturers Securities Services, LLC -
Delaware (90%)
17.1.3.1.2.2. The Manufacturers Life Insurance Company
of New York - New York (100%)
17.1.3.1.2.2.1 Manufacturers
Securities Services,
LLC - Delaware (10%)
17.1.3.2. Flex Leasing 1, LLC - Delaware (50%)
17.1.3.3. Ennal, Inc. - Ohio (100%)
17.1.3.4. ESLS Investment Limited, LLC - Ohio (100%)
17.1.3.5. Thornhill Leasing Investments, LLC - Delaware (90%)
17.1.3.6. The Manufacturers Life Insurance Company of America
- Michigan (100%)
17.1.3.6.1. Manulife Holding Corporation - Delaware (100%)
17.1.3.6.1.1. ManEquity, Inc. - Colorado (100%)
17.1.3.6.1.2. Manufacturers Adviser Corporation -
Colorado (100%)
17.1.3.6.1.3. Manulife Capital Corporation - Delaware
(100%)
17.1.3.6.1.3.1. MF Private Capital, Inc. - Delaware
(80.4%)
17.1.3.6.1.3.1.1. MF Private Capital Securities,
Inc. - Delaware (100%)
17.1.3.6.1.3.1.2. MFPC Ventures, Inc. - Delaware
(100%)
17.1.3.6.1.3.1.3. MFPC Insurance Advisors, Inc. -
Delaware (100%)
17.1.3.6.1.4. Manulife Property Management of
Washington, D.C. Inc. - Washington, D.C.
(100%)
17.1.3.4.1.5. ManuLife Service Corporation - Colorado
(100%)
17.1.3.4.1.6. Manulife Leasing Co., LLC. - Delaware
(80%)
18. Manulife International Investment Management Limited - U.K. (100%)
18.1. Manulife International Fund Management Limited - U.K. (100%)
19. WT(SW) Properties Ltd. - U.K. (100%)
20. Manulife Europe Ruckversicherungs-Aktiengesellschaft - Germany (100%)
21. Manulife International Holdings Limited - Bermuda (100%)
21.1. Manulife Provident Funds Trust Company Limited - Hongkong (100%)
21.2. Manulife (International) Limited - Bermuda (100%)
21.2.1. Zhong Hong Life Insurance Co. Ltd. - China (51%)
21.3. Manulife Funds Direct (Barbados) Limited - Barbados (100%)
21.3.1. Manulife Funds Direct (Hong Kong) Limited - Hongkong (100%)
21.3.2. Pt. Manulife Aset Manajemen Indonesia - Indonesia (55%)
7
<PAGE> 66
22. ManuLife (International) Reinsurance Limited - Bermuda (100%)
22.1. Manufacturers Life Reinsurance Limited - Barbados (100%)
22.2. Manufacturers P&C Limited - Barbados (100%)
22.3. Manulife Management Services Ltd. - Barbados (100%)
23. Chinfon-Manulife Insurance Company Limited - Bermuda (60%)
24. Manulife Century Investments (Bermuda) Limited - Bermuda (13%)
25. Manulife Century Investments (Alberta) Inc. - Alberta (100%)
25.1 Manulife Century Investments (Bermuda) Limited - Bermuda (87%)
25.1.1 Daihyaku System Service Co. Ltd. - Japan (90%)
25.2 Manulife Century Investments (Luxembourg) S.A. - Luxembourg
(100%)
25.2.1 Manulife Century Investments (Netherlands) B.V. -
Netherlands (100%)
25.2.1.1 Daihyaku Manulife Holdings (Bermuda) Limited -
Bermuda (100%)
25.2.1.1.1 Manulife Century Life Insurance Company - Japan
(8.8%)
25.2.1.2 Manulife Century Life Insurance Company - Japan (74.6%)
25.2.1.2.1 Daihyaku System Service Co. Ltd. - Japan (10%)
25.2.1.2.2 Manulife Century Business Company - Japan (100%)
25.2.1.2.3 Kyoritsu Confirm Co., Ltd. - Japan (9.1%)
25.2.1.2.4 Daihyaku Premium Collection Co., Ltd. - Japan
(10%)
25.2.1.3 Kyoritsu Confirm Co., Ltd. - Japan (90.9%)
25.2.1.4 Daihyaku Premium Collection Co., Ltd. - Japan (57%)
26. P.T. Asuransi Jiwa Dharmala ManuLife - Indonesia (51%)
26.1. P.T. Buanadays Sarana Informatika - Indonesia (100%)
26.2. P.T. Asuransi Jiwa Arta Mandiri Prime - Indonesia (100%)
27. OUB Manulife Pte. Ltd. - Singapore (50%)
28. The Manufacturers Life Insurance Company (Phils.) Inc. - Philippines
(100%)
Item 27. Number of Contract Owners.
As of December 31, 1999, there were 86 qualified and 232 non-qualified contracts
of the series offered hereby outstanding.
8
<PAGE> 67
Item 28. Indemnification.
Article 10 of the Charter of the Company provides as follows:
TENTH: No director of the Corporation shall be personally liable to the
Corporation or any of its shareholders for damages for any breach of duty as a
director; provided, however, the foregoing provision shall not eliminate or
limit (i) the liability of a director if a judgment or other final adjudication
adverse to such director established his or her such acts or omissions were in
bad faith or involved intentional misconduct or were acts or omissions (a) which
he or she knew or reasonably should have known violated the New York Insurance
Law or (b) which violated a specific standard of care imposed on directors
directly, and not by reference, by a provision of the New York Insurance Law (or
any regulations promulgated thereunder) or (c) which constituted a knowing
violation of any other law, or establishes that the director personally gained
in fact a financial profit or other advantage to which the director was not
legally entitled or (ii) the liability of a director for any act or omission
prior to the adoption of this Article by the shareholders of the Corporation.
Any repeal or modification of this Article by the shareholders of the
Corporation shall be prospective only, and shall not adversely affect any
limitation on the personal liability of a director of the Corporation existing
at the time of such repeal or modification.
Article VII of the By-laws of the Company provides as follows:
Section VII.1. Indemnification of Directors and Officers. The Corporation may
indemnify any person made, or threatened to be made, a party to an action by or
in the right of the corporation to procure a judgment in its favor by reason of
the fact that he or she, his or her testator, testatrix or intestate, is or was
a director or officer of the Corporation, or is or was serving at the request of
the Corporation as a director or officer of any other corporation of any type or
kind, domestic or foreign, of any partnership, joint venture, trust, employee
benefit plan or other enterprise, against amounts paid in settlement and
reasonable expenses, including attorneys' fees, actually and necessarily
incurred by him or her in connection with the defense or settlement of such
action, or in connection with an appeal therein, if such director or officer
acted, in good faith, for a purpose which he or she reasonably believed to be
in, or, in the case of service for any other corporation or any partnership,
joint venture, trust, employee benefit plan or other enterprise, not opposed to,
the best interests of the Corporation, except that no indemnification under this
Section shall be made in respect of (1) a threatened action, or a pending action
which is settled or is otherwise disposed of, or (2) any claim, issue or matter
as to which such person shall have been adjudged to be liable to the
Corporation, unless and only to the extent that the court in which the action
was brought, or , if no action was brought, any court of competent jurisdiction,
determines upon application that, in view of all the circumstances of the case,
the person is fairly and reasonably entitled to indemnity for such portion of
the settlement amount and expenses as the court deems proper.
The Corporation may indemnify any person made, or threatened to be made, a party
to an action or proceeding (other than one by or in the right of the Corporation
to procure a judgment in its favor), whether civil or criminal, including an
action by or in the right of any other corporation of any type or kind, domestic
or foreign, or any partnership, joint venture, trust, employee benefit plan or
other enterprise, which any director or officer of the Corporation served in any
capacity at the request of the Corporation, by reason of the fact that he or
she, his or her testator, testatrix or intestate, was a director or officer of
the Corporation, or served such other corporation, partnership, joint venture,
trust, employee benefit plan or other enterprise in any capacity, against
judgments, fines, amounts paid in settlement and
9
<PAGE> 68
reasonable expenses, including attorneys' fees actually and necessarily incurred
as a result of such action or proceeding, or any appeal therein, if such
director or officer acted, in good faith, for a purpose which he or she
reasonably believed to be in, or, in the case of service for any other
corporation or any partnership, joint venture, trust, employee benefit plan or
other enterprise, not opposed to, the best interests of the Corporation and, in
criminal actions or proceedings, in addition, had no reasonable cause to believe
that his or her conduct was unlawful.
The termination of any such civil or criminal action or proceeding by judgment,
settlement, conviction or upon a plea of nolo contendere, of its equivalent,
shall not in itself create a presumption that any such director or officer did
not act, in good faith, for a purpose which he or she reasonably believed to be
in, or, in the case of service for any other corporation or any partnership,
joint venture, trust, employee benefit plan or other enterprise, not opposed to,
the best interest of the Corporation or that he or she had reasonable cause to
believe that his or her conduct was unlawful.
Notwithstanding the foregoing, Registrant hereby makes the following undertaking
pursuant to Rule 484 under the Securities Act of 1933:
Insofar as indemnification for liability arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or
otherwise, the registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against
public policy as expressed in the Act and is, therefore, unenforceable.
In the event a claim for indemnification against such liabilities
(other than the payment by the registrant of expenses incurred or paid
by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the
securities being registered, the registrant will, unless in the opinion
of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act
and will be governed by the final adjudication of such issue.
Notwithstanding the foregoing, Registrant hereby makes the following undertaking
pursuant to Rule 484 under the Securities Act of 1933:
Insofar as indemnification for liability arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or
otherwise, the registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against
public policy as expressed in the Act and is, therefore, unenforceable.
In the event a claim for indemnification against such liabilities
(other than the payment by the registrant of expenses incurred or paid
by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the
securities being registered, the registrant will, unless in the opinion
of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act
and will be governed by the final adjudication of such issue.
10
<PAGE> 69
Item 29. Principal Underwriters.
a. NAME OF INVESTMENT COMPANY CAPACITY IN WHICH ACTING
Manufacturers Investment Trust Investment Adviser
The Manufacturers Life Insurance Principal Underwriter
Company of North America Separate
Account A
The Manufacturers Life Insurance Principal Underwriter
Company of North America Separate
Account B
The Manufacturers Life Insurance Principal Underwriter
Company of New York Separate
Account A
The Manufacturers Life Insurance Principal Underwriter
Company of New York Separate
Account B
b. The Manufacturers Life Insurance Company of North America is the managing
member of Manufacturers Securities Services, LLC and has sole power to act on
behalf of Manufacturers Securities Services, LLC. The officers and directors of
The Manufacturers Life Insurance Company of North America are set forth below.
NAME AND PRINCIPAL POSITION WITH THE MANUFACTURERS LIFE INSURANCE
BUSINESS ADDRESS COMPANY OF NORTH AMERICA
James R. Boyle Director and President
500 Boylston Street
Boston, MA 02116
John D. DesPrez III Director and Chairman of the Board of
73 Tremont Street Directors
Boston, MA 02108
John D. Richardson Director
200 Bloor Street East
Toronto, Ontario
Canada M4W-1E5
John G. Vrysen Vice President & Chief Actuary
73 Tremont Street
Boston, MA 02108
11
<PAGE> 70
James D. Gallagher Vice President, Secretary and General Counsel
73 Tremont Street
Boston, MA 02108
Janet Sweeney Vice President, Human Resources
73 Tremont Street
Boston, MA 02108
Robert Boyda Vice President, Investment Management Services
73 Tremont Street
Boston, MA 01208
David W. Libbey Vice President, Treasurer & Chief
500 Boylston Street Financial Officer
Boston, MA 02116
Kevin Hill Vice President, Business Implementation
500 Boylston Street
Boston, MA 02116
Brian Kroll Vice President, Product Development
500 Boylston Street
Boston, MA 02116
Jonnie Smith Vice President, Customer Service
500 Boylston Street and Administration
Boston, MA 02116
c. None.
Item 30. Location of Accounts and Records.
All books and records are maintained at 100 Summit Lake Drive, Second Floor,
Valhalla, New York 10595.
Item 31. Management Services.
The Company has entered into an Administrative Services Agreement with The
Manufacturers Life Insurance Company ("Manulife"). This Agreement provides that
under the general supervision of the Board of Directors of the Company, and
subject to initiation, preparation and verification by the Chief Administrative
Officer of the Company, Manulife shall provide accounting services related to
the provision of a payroll support system, general ledger, accounts payable, tax
and auditing services.
Item 32. Undertakings.
a. Representation of Insurer pursuant to Section 26 of the Investment Company
Act of 1940.
12
<PAGE> 71
The Manufacturers Life Insurance Company of New York (the "Company")
hereby represents that the fees and charges deducted under the
Contracts issued pursuant to 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 the Company.
13
<PAGE> 72
SIGNATURES
As required by the Securities Act of 1933 and the Investment Company Act of
1940, the Registrant, THE MANUFACTURERS LIFE INSURANCE COMPANY OF NEW YORK
SEPARATE ACCOUNT A, has duly caused this amended Registration Statement to be
signed on its behalf, in the City of Boston, and Commonwealth of Massachusetts
on this 28th day of February, 2000.
THE MANUFACTURERS LIFE INSURANCE COMPANY
OF NEW YORK SEPARATE ACCOUNT A
(Registrant)
By: THE MANUFACTURERS LIFE INSURANCE
COMPANY OF NEW YORK
(Depositor)
By: /s/ JAMES D. GALLAGHER
---------------------------------
James D. Gallagher
President
Attest
/s/ TRACY A. KANE
- ---------------------
Tracy A. Kane
Secretary
Pursuant to the requirements of the Securities Act of 1933, the Depositor has
duly caused this amended Registration Statement to be signed on its behalf by
the undersigned on the 28th day of February, 2000 in the City of Boston, and
Commonwealth of Massachusetts.
THE MANUFACTURERS LIFE INSURANCE COMPANY
OF NEW YORK SEPARATE ACCOUNT A
(Registrant)
By: THE MANUFACTURERS LIFE INSURANCE
COMPANY OF NEW YORK
(Depositor)
By: /s/ JAMES D. GALLAGHER
---------------------------------
James D. Gallagher
President
Attest
/s/ TRACY A. KANE
- ---------------------
Tracy A. Kane
Secretary
<PAGE> 73
As required by the Securities Act of 1933, this amended Registration Statement
has been signed by the following persons in the capacities with the Depositor on
the 28th day of February, 2000.
SIGNATURE TITLE
* Chairman of the Board
- --------------------------
John D. Richardson of Directors
/s/ JAMES D. GALLAGHER Director and President
- --------------------------
James D. Gallagher (Principal Executive
Officer)
* Director
- --------------------------
John D. DesPrez, III
* Director
- --------------------------
James R. Boyle
* Director
- --------------------------
James K. Robinson
* Director
- --------------------------
Neil M. Merkl
* Director
- --------------------------
Bruce Avedon
* Director
- --------------------------
Ruth Ann Fleming
* Director
- --------------------------
James P. O'Malley
* Director
- --------------------------
Thomas Borshoff
* Director
- --------------------------
Robert Cook
/s/ DAVID W. LIBBEY Treasurer (Principal
- --------------------------
David W. Libbey Financial and Accounting
Officer)
*By: /s/ TRACY A. KANE
--------------------------
Tracy A. Kane
Attorney-in-Fact Pursuant
to Powers of Attorney
<PAGE> 74
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Description
- ----------- -----------
<S> <C>
(5) Specimen Application for Single Purchase Payment
Individual Deferred Combination Fixed and Variable
Annuity Contract, Non-Participating - Filed Herein.
</TABLE>
14
<PAGE> 1
- --------------------------------------------------------------------------------
Single Payment Deferred Combination Fixed and Variable Annuity Application.
Payment (or original of exchange/transfer request) must accompany Application.
Please make check payable to THE MANUFACTURERS LIFE INSURANCE COMPANY OF NEW
YORK (the "Company") and address to: ANNUITY SERVICE OFFICE, P.O. BOX 9013,
BOSTON, MA 02205-9013
PLEASE PRINT
1. OWNERS (APPLICANTS)
Name*
- --------------------------------------------------
First Middle Last
Address
- --------------------------------------------------
Street
- --------------------------------------------------
City State Zip
---------------
Sex [ ]M [ ]F Date of Birth: | | | |
---------------
Month Day Year
Daytime Phone Number: ( )
-----------------------------
------------------- -------------------
| | | | | | | | | | | | | | | | | | | |
------------------- -------------------
Social Security Number or Tax ID Number
Client Brokerage Acct.# (If applicable):
------------
CO-OWNER (OPTIONAL)
Name*
- --------------------------------------------------
First Middle Last
----------------
Sex [ ]M [ ]F Date of Birth: | | | |
----------------
Month Day Year
------------------- -------------------
| | | | | | | | | | | | | | | | | | | |
------------------- -------------------
Social Security Number or Tax ID Number
2. ANNUITANTS (IF DIFFERENT FROM OWNER)
Name*
- --------------------------------------------------
First Middle Last
Address
- --------------------------------------------------
Street
- --------------------------------------------------
City State Zip
----------------
Sex [ ]M [ ]F Date of Birth: | | | |
----------------
Month Day Year
Daytime Phone Number: ( )
-----------------------------
-------------------
| | | | | | | | | |
-------------------
Social Security Number
CO-ANNUITANT (OPTIONAL)
Name*
- --------------------------------------------------
First Middle Last
----------------
Sex [ ]M [ ]F Date of Birth: | | | |
----------------
Month Day Year
-------------------
| | | | | | | | | |
-------------------
Social Security Number
3. BENEFICIARIES
(Enclose signed letter if more information is required.)
Name*
- ----------------------------------------------------------
First Middle Last Relationship
---------------- -------------------
Date of Birth: | | | | | | | | | | | | | |
---------------- -------------------
Month Day Year Social Security Number
Name*
- ----------------------------------------------------------
First Middle Last Relationship
---------------- -------------------
Date of Birth: | | | | | | | | | | | | | |
---------------- -------------------
Month Day Year Social Security Number
CONTINGENT BENEFICIARY
Name*
- ----------------------------------------------------------
First Middle Last Relationship
---------------- -------------------
Date of Birth: | | | | | | | | | | | | | |
---------------- -------------------
Month Day Year Social Security Number
4. MY INVESTMENT
Allocate payment with application of $_________________
as indicated below. (Minimum Investment of $25,000.
Allocation percentages must total 100%):
___% MAC Pacific Rim Emerging Markets (038)
___% T. Rowe Price Science & Technology (046)
___% Founders Int'l Small Cap (036)
___% A I M Aggressive Growth (052)
___% Franklin Emerging Small Company (050)
___% CGTC Small Company Blend (072)
___% A I M Mid Cap Growth (041)
___% Wellington Management Mid Cap Stock (075)
___% Fidelity Overseas (043)
___% Rowe Price-Fleming Int'l Stock (054)
___% Franklin Int'l Value (079)
___% Fidelity Mid Cap Blend (031)
___% AXA Rosenberg Small Company Value (121)
___% MSAM Global Equity (039)
___% SSgA Growth (035)
___% Fidelity Large Cap Growth (034)
___% MAC Quantitative Equity (053)
___% T. Rowe Price Blue Chip Growth (042)
___% MAC Real Estate Securities (057)
___% MAS Value (055)
___% Wellington Management Growth & Income (047)
___% CGTC U.S. Large Cap Value (067)
___% T. Rowe Price Equity-Income (037)
___% CGTC Income & Value (033)
___% Founders Balanced (058)
___% MAS High Yield (059)
___% SaBAM Strategic Bond (045)
___% PIMCO Global Bond (040)
___% PIMCO Total Return (175)
___% Wellington Management Inv Quality Bond (048)
___% CGTC Diversified Bond (032)
___% SaBAM U.S. Gov't Securities (044)
___% MAC Money Market (049)
Lifestyle Portfolios
___% Aggr 1000 (188)
___% Growth 820 (187)
___% Bal 640 (186)
___% Mod 460 (185)
___% Cons 280 (184)
Fixed Account
___% 1 Yr (051)
REMARKS
VISION.NY.APP 99
* Unless subsequently changed in accordance with terms of Contract issued.
NY 5/99
<PAGE> 2
5. Type of Plan (Must be completed)
<TABLE>
<S> <C> <C> <C>
[ ] Non-Qualified or [ ] IRA Rollover [ ] IRA Transfer [ ] IRA Tax Year
--------
[ ] Profit Sharing [ ] 401(k) [ ] SEP IRA Tax Year
-----
[ ] Money Purchase [ ] Keogh (HR-10) [ ] 403(b) If ERISA [ ]
[ ] Defined Benefit [ ] Other
----------------
</TABLE>
6. Signatures
(Irrevocable Beneficiary, if designated, must also sign application.)
STATEMENT OF APPLICANT:I/We agree that the Contract I/we have applied for shall
not take effect until the later of:(1) the issuance of the Contract, or (2)
receipt by the Company at its Annuity Service Office of the first payment
required under the Contract. The information above is true and complete to the
best of my/our knowledge and belief and is correctly recorded. I/We agree to be
bound by the representations made in this application and acknowledge the
receipt of an effective Prospectus describing the Contract applied for. The
Contract I/we have applied for is suitable for my/our insurance investment
objectives, financial situation and needs. When utilizing Check Plus or the
Income Plan, I/we agree that if any debit/transfer is erroneously received by
the bank indicated on the enclosed voided check, or is not honored upon
presentation, any accumulation units may be canceled, and agree to hold the
Company harmless from any loss due to such electronic debits/transfers. I/We
understand that unless I/we elect otherwise in the remarks section,the Maturity
Date will be the later of the Annuitant's 85th birthday,or 10 years from the
Contract Date. In no event will the Maturity Date exceed age 90.
I/WE UNDERSTAND THAT ANNUITY PAYMENTS AND OTHER VALUES PROVIDED BY THE CONTRACT
APPLIED FOR,WHEN BASED ON THE INVESTMENT EXPERIENCE OF A SEPARATE ACCOUNT,ARE
VARIABLE AND NOT GUARANTEED AS TO FIXED DOLLAR AMOUNT.
- ----------------------------------------------------
Signed in (State)
- ----------------------------------------------------
Date Signed
- ----------------------------------------------------
Signature of Owner/Applicant
- ----------------------------------------------------
Signature of Co-Owner
- ----------------------------------------------------
Signature of Annuitant (if different from Owner)
- ----------------------------------------------------
Signature of Co-Annuitant (if different from Owner)
- ----------------------------------------------------
Signature of Irrevocable Beneficiary (if designated)
STATEMENT OF AGENT:Will this contract replace or change any existing life
insurance or annuity in this or any other company? [ ] Yes [ ] No If yes,please
explain under Remarks. I certify that I am authorized and qualified to discuss
the Contract herein applied for.
<TABLE>
<S> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
Signature of Agent Print Full Name Name of Firm
- ------------------------------------------------------------------------------------------------------------------------------------
Agent Number Agent Phone Number State License ID Number
</TABLE>
VISION.NY.APP.99
* Unless subsequently changed in accordance with terms of Contract issued.
NY 5/99
<PAGE> 3
Initial below each VENTURE VISION service option you wish to elect.
[ ] Owner MUST initial here to elect this option. Automatic Rebalancing
If marked, the policyholder's contract value, excluding amounts in the fixed
account investment options, will be automatically rebalanced to maintain the
rebalancing percentage levels in the variable portfolios based on the current
total value of the eligible portfolios on the day of rebalancing.
You may change the rebalancing percentages or terminate your participation in
the program by providing the Company with a completed Automatic Rebalancing
Authorization form or by providing instructions via telephone to an authorized
Company representative prior to the day the rebalancing will occur.
If a policyholder elects to participate in Automatic Rebalancing, the total
value of the variable portfolios must be included in the program. Therefore,
fund exchanges and subsequent payments received and applied to portfolios in
percentages different from the current rebalancing allocation will be rebalanced
at the next date of rebalancing unless the subsequent payments are allocated to
the fixed account investment options.
Rebalancing will occur on the 25th of the month (or next business day), please
indicate frequency. If no frequency is indicated, then Automatic Rebalancing
will occur Quarterly:
[ ] Quarterly [ ] Semi-Annually (June & December) [ ] Annually (December)
Rebalancing percentages as indicated by variable Investment Allocations elected
on the first page of the application, unless subsequently changed.
[ ] Owner MUST initial here to elect this option. Dollar Cost Averaging*
(Minimum Payment $6,000)
I authorize the Company to transfer an amount (minimum $100) each month as
indicated below. Transfers are available from all variable and the one-year
fixed investment options. A maximum of 10% from the one-year fixed investment
option may be transferred monthly (10% maximum waived for promotional DCA
programs). Please make first transfer on ____/____/____ (mm/dd/yy).
START DATE: _____________ (Indicate day of month excluding 29th, 30th, or 31st.)
If application is received AFTER the requested start date, transfers will
commence on the requested day of the following month. If no start date is
indicated or the selected start date falls on a weekend or holiday, transfers
will commence on the next available business day.
Length of Transfer Period: [ ] Indefinitely (or as long as all source funds have
balances.)
[ ] ______ Months
Source Fund Monthly Amount
_______________________________________ $ _______________________________
Destination Fund Monthly Amount to Destination Fund
_______________________________________ $ _______________________________
_______________________________________ $ _______________________________
_______________________________________ $ _______________________________
________________________________________________________________________________
VISION.NY.APP.99 * Unless subsequently changed in NY 5/99
accordance with terms of Contract issued.
<PAGE> 4
Initial below each VENTURE VISION service option you wish to elect.
/ / Owner MUST initial here to elect this option
Income Plan * (Minimum Payment $12,000)
I authorize withdrawals (minimum $100) from my Contract Value to commence as
indicated below. A maximum of 10% of payments may be withdrawn annually. When
utilizing the Income Plan, I agree that if any debit/transfer is erroneously
received by the bank indicated on the enclosed voided check, or is not honored
upon presentation, any accumulation units may be canceled, and agree to hold the
Company harmless from any loss due to such electronic debits/transfers.
$ prorata from active variable portfolios OR
----------
From: $
----------------------------- -----------------
From: $
----------------------------- -----------------
From: $
----------------------------- -----------------
From: $
----------------------------- -----------------
From: $
----------------------------- -----------------
Indicate frequency: / / Monthly or / / Quarterly (January, April, July and
October)
Day of Withdrawal: / / 1st / / 7th / / 16th or / / 26th
FEDERAL TAX INFORMATION (If no selection is made, the Company will NOT
withhold taxes.)
Choose one: / / Do not withhold Federal Income Taxes
/ / Withhold the 10% minimum (20% for 403(b) TSA accounts) for
Federal Income Tax
/ / Withhold $
--------------
/ / I wish to utilize Electronic Funds Transfer in the processing of my Income
Plan (may take 20 business days).
A VOIDED CHECK MUST BE ATTACHED.
Or, if different from owner, make check payable to:
- --------------------------------------------------------------------------------
First Middle Last
- --------------------------------------------------------------------------------
Street City State Zip
(Allow 7 business days for receipt of check.)
VISION.NY.APP.99 * Unless subsequently changed with terms of Contract issued.
NY 5/99
