<PAGE>
File Nos. 33-61679
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-4
REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OF 1933
|_| Pre-Effective Amendment No. ___ |X| Post-Effective Amendment No. 8
REGISTRATION STATEMENT UNDER THE INVESTMENT
COMPANY ACT OF 1940
|X| Amendment No. 15
(Check appropriate box or boxes.)
C.M. MULTI-ACCOUNT A
--------------------------
(Exact Name of Registrant)
C.M. LIFE INSURANCE COMPANY
---------------------------
(Name of Depositor)
140 Garden Street, Hartford, Connecticut 06154
----------------------------------------------
(Address of Depositor's Principal Executive Offices) (Zip Code)
Depositor's Telephone Number, including Area Code 1-800-234-5606
Name and Address of Agent for Service
Ann F. Lomeli, Secretary C.M. Life
Insurance Company 140 Garden Street
Hartford, Connecticut 06154
Approximate Date of Proposed Public Offering: Continuous
It is proposed that this filing will become effective
|_| immediately upon filing pursuant to paragraph (b) of Rule 485
|X| on May 1, 1999 pursuant to paragraph (b) of Rule 485
|_| 60 days after filing pursuant to paragraph (a) of Rule 485
|_| on (date) pursuant to paragraph (a) of the Rule 485
If appropriate, check the following box:
|_| This post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
STATEMENT PURSUANT TO RULE 24f-2
The Registrant has registered an indefinite number or amount of its variable
annuity contracts under the Securities Act of 1993 pursuant to Rule 24f-2 under
the Investment Company Act of 1940. The Rule 24f-2 Notice for Registrant's
fiscal year ended December 31, 1998 was filed on or about March 22, 1999.
1
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CROSS REFERENCE TO ITEMS
REQUIRED BY FORM N-4
N-4 Item Caption in Prospectus
- -------- ---------------------
1 ....................................... Cover Page
2 ....................................... Definitions
3 ....................................... Table of Fees and Expenses
4 ....................................... Condensed Financial
Information; Performance
5 ....................................... The Company; Investment Choices
6 ....................................... Expenses; Distribution
7 ....................................... Ownership; Purchasing a Contract;
Voting Rights; Reservation of Rights;
Contract Value; Cover Page
8 ....................................... The Income Phase
9 ....................................... Death Benefit
10 ...................................... The Accumulation Phase;
Distributors
11 ...................................... Highlights; Withdrawals
12 ...................................... Taxes
13 ...................................... Legal Proceedings
14 ...................................... Additional Information
2
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Caption in Statement of
Additional Information
----------------------
15 ...................................... Cover Page
16 ...................................... Table of Contents
17 ...................................... Company
18 ...................................... Experts; Distribution
19 ...................................... Purchase of Securities Being Offered
20 ...................................... Distribution
21 ...................................... Performance Measures
22 ...................................... Annuity Payments
23 ...................................... Financial Statements
3
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PART A
INFORMATION REQUIRED IN A PROSPECTUS
4
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C.M. Life Insurance Company
C.M. Multi-Account A
Panorama Premier Variable Annuity
This prospectus describes the Panorama Premier Contract offered by C.M. Life
Insurance Company. This contract is an individual deferred variable annuity. It
provides for accumulation of contract value and annuity payments on a fixed and
variable basis.
You, the contract owner, have a number of investment choices in this contract.
These investment choices include two fixed account options as well as the
following seventeen funds which are offered through our separate account, C.M.
Multi-Account A.
Panorama Series Fund, Inc.
o Panorama Total Return Portfolio
o Panorama Growth Portfolio
o Panorama International Equity Portfolio
o Panorama LifeSpan Capital Appreciation Portfolio
o Panorama LifeSpan Balanced Portfolio
o Panorama LifeSpan Diversified Income Portfolio
Oppenheimer Variable Account Funds
o Oppenheimer Money Fund/VA
o Oppenheimer Bond Fund/VA
Fidelity Variable Insurance Products Fund II
o VIP II Contrafund Portfolio
American Century Variable Portfolios, Inc.
o American Century VP Income & Growth Portfolio
T. Rowe Price Equity Series, Inc.
o T. Rowe Price Mid-Cap Growth Portfolio
MML Series Investment Fund
o MML Equity Fund*
o MML Blend Fund*
o MML Equity Index Fund*
o MML Small Cap Value Equity Fund
o MML Growth Equity Fund*
o MML Small Cap Growth Equity Fund*
* Subject to state availability
Please read this prospectus before investing. You should keep it for future
reference. It contains important information about the Panorama Premier Variable
Annuity.
To learn more about the Panorama Premier contract, you can obtain a copy of the
Statement of Additional Information (SAI), dated May 1, 1999. We filed the SAI
with the Securities and Exchange Commission (SEC) and it is legally a part of
this prospectus. The SEC maintains a Web site (http://www.sec.gov) that contains
the SAI, material incorporated by reference and other information regarding
companies that file electronically with the SEC. The Table of Contents of the
SAI is on page 32 of this prospectus. For a free copy of the SAI, or for general
inquiries, call our Annuity Service Center at (800) 366-8226 or write to:
Panorama Premier, Annuity Products, H565, P.O. Box 9067, Springfield,
Massachusetts 01102-9067.
The contracts:
o are not bank deposits.
o are not federally insured.
o are not endorsed by any bank or governmental agency.
o are not guaranteed and may be subject to loss of principal.
- --------------------------------------------------------------------------------
The SEC has not approved these contracts or determined that this prospectus is
accurate or complete. Any representation that it has is a criminal offense.
- --------------------------------------------------------------------------------
May 1, 1999.
1
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Table Of Contents
Highlights 4
The C.M. Life Multi-Account A - A Table of Fees and Expenses 5
The Company 9
The Panorama Premier Deferred
Variable Annuity Contract - General Overview 9
Ownership of the Contact 10
Owner 10
Joint Owner 10
Annuitant 10
Beneficiary 10
Purchasing a Contract 11
Purchase Payments 11
Allocation of Purchase Payments 11
Investment Choices 12
The Separate Account 12
The Funds 12
The Fixed Accounts 15
DCA Fixed Account 15
The Fixed Account 15
Contract Value 16
Accumulation Units 16
Transfers 16
Transfers During the Accumulation Phase 16
Transfers During the Income Phase 17
Dollar Cost Averaging Program 17
Automatic Rebalancing Program 18
Withdrawals 18
Systematic Withdrawal Program 19
Expenses 20
Insurance Charges 20
Mortality and Expense Risk Charge 20
Administrative Charge 20
Annual Contract Maintenance Charge 20
Contingent Deferred Sales Charge 20
Free Withdrawals 22
Premium Taxes 22
Transfer Fee 22
Income Taxes 22
Fund Expenses 22
The Income Phase 23
Fixed Annuity Payments 23
Variable Annuity Payments 23
Annuity Unit Value 24
Annuity Options 24
Death Benefit 25
Death of Contract Owner During the Accumulation Phase 25
Death Benefit Amount During the Accumulation Phase 25
Death Benefit Options During the Accumulation Phase 25
Death of Contract Owner During the Income Phase 26
Death of Annuitant 26
Taxes 27
Annuity Contracts in General 27
Qualified and Non-Qualified Contracts 27
Withdrawals - Non-Qualified Contracts 27
Withdrawals - Qualified Contracts 28
Other Information 29
Terminal Illness Benefit 29
Performance 29
Standardized Total Returns 29
Nonstandard Total Returns 29
Yield and Effective Yield 30
Related Performance 30
Year 2000 30
Distributors 30
Electronic Transmission of Application Information 31
Assignment 31
Voting Rights 31
Reservation of Rights 31
Suspension of Payments or Transfers 31
Legal Proceedings 31
Financial Statements 32
Additional Information 32
Appendix A -
Condensed Financial Information A-1
2 Table Of Contents
<PAGE>
Index of Special Terms
We have tried to make this prospectus as readable and understandable for you as
possible. By the very nature of the contract, however, certain technical words
or terms are unavoidable. We have identified the following as some of these
words or terms. The page that is indicated here is where we believe you will
find the best explanation for the word or term.
Page
Accumulation Phase 9
Accumulation Unit 16
Annuitant 10
Annuity Date 23
Annuity Options 24
Annuity Payments 23
Annuity Service Center Cover Page
Annuity Unit Value 24
Contract Anniversary 25
Free Withdrawal 22
Income Phase 9
Non-Qualified 27
Purchase Payment 11
Qualified 27
Separate Account 12
Tax Deferral 9
Index of Special Terms 3
<PAGE>
Highlights
This prospectus describes the general provisions of the Panorama Premier
contract. You may review a copy of the contract upon request.
Free Look
You have a right to examine your contract. If you change your mind about owning
your contract, you can cancel it within 10 days after receiving it. However,
this time period may vary by state. When you cancel the contract within this
time period, we will not assess a sales charge. You will receive back your
contract value as of the business day we receive your contract and written
request at our Annuity Service Center. If you purchase this contract as an IRA
or your state requires it, we will return the greater of your purchase payments
less any withdrawals you took, or the contract value.
Contingent Deferred Sales Charge
We do not deduct a sales charge when we receive a purchase payment from you.
However, we may assess a contingent deferred sales charge if you withdraw any
part of the contract value. The amount of the contingent deferred sales charge
depends on the amount of your purchase payments and the length of time since you
made them. The contingent deferred sales charge ranges from 7% to 0%.
Federal Income Tax Penalty
If you withdraw any of the contract value from your non-qualified contract, a
10% federal income tax penalty may be applied to the amount of the withdrawal
that is includible in your gross income for tax purposes. Some withdrawals may
be exempt from the penalty tax. They include any amounts:
o paid on or after you reach age 59 1/2;
o paid to your beneficiary after you die;
o paid if you become totally disabled as that term is defined in the
Internal Revenue Code;
o paid in a series of substantially equal payments made annually or more
frequently, for life or a period not exceeding life expectancy;
o paid under an immediate annuity; or
o which come from purchase payments made before August 14, 1982.
The Internal Revenue Code (the Code) treats any withdrawal as first coming from
earnings and then from your purchase payments. Separate tax penalties and
restrictions apply to withdrawals under qualified contracts. Please refer to the
Taxes section of this prospectus for more information.
4 Highlights
<PAGE>
C.M. Life Multi-Account A
Table Of Fees And Expenses
Contract Owner Transaction Expenses
Transfer Fee:
During Accumulation Phase: We will not charge for the first 12 transfers
in a calendar year; thereafter we will assess
a fee which is the lesser of $20 or 2% of the
amount transferred.
During Income Phase: We allow only 6 transfers in a calendar
During Income Phase: year and we will not
assess a fee for these 6 transfers.
Sales Load on Purchases: 0%
Contingent Deferred Sales Charge as a percentage of purchase payments withdrawn:
- --------------------------------------------------------------------------------
Full years since payment 0 1 2 3 4 5 6 7 or more
- --------------------------------------------------------------------------------
Percentage 7% 6% 5% 4% 3% 2% 1% 0%
- --------------------------------------------------------------------------------
Annual Contract Maintenance Charge: $30 per Contract Year.
Separate Account Annual Expenses
(as a percentage of the average account value)
Mortality and Expense Risk Charge: 1.25%
Administrative Charge: 0.15%
-----
Total Separate Account Annual Expenses: 1.40%
Table Of Fees & Expenses 5
<PAGE>
Annual Fund Expenses
(as a percentage of average net assets as of December 31, 1998)
<TABLE>
<CAPTION>
Other Total Operating
Expenses After Expenses After
Management Expense Expense
Fees Reimbursements Reimbursements
<S> <C> <C> <C>
- -------------------------------------------------------------------------------------------------
Oppenheimer Money Fund/VA 0.45% 0.05% 0.50%
- -------------------------------------------------------------------------------------------------
Oppenheimer Bond Fund/VA 0.72% 0.02% 0.74%
- -------------------------------------------------------------------------------------------------
Panorama LifeSpan Diversified Income Portfolio 0.75% 0.09% 0.84%
- -------------------------------------------------------------------------------------------------
Panorama Total Return Portfolio 0.53% 0.02% 0.55%
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Panorama LifeSpan Balanced Portfolio 0.85% 0.08% 0.93%
- -------------------------------------------------------------------------------------------------
Panorama LifeSpan Capital Appreciation Portfolio 0.85% 0.08% 0.93%
- -------------------------------------------------------------------------------------------------
Panorama Growth Portfolio 0.52% 0.01% 0.53%
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Panorama International Equity Portfolio 1.00% 0.09% 1.09%
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Fidelity's VIP II Contrafund Portfolio 0.59% 0.07%**** 0.66%****
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American Century VP Income & Growth Portfolio 0.70% 0.00% 0.70%
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T. Rowe Price Mid-Cap Growth Portfolio 0.85% 0.00% 0.85%
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MML Small Cap Value Equity Fund 0.39% 0.05%** 0.44%
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MML Equity Fund*** 0.37% 0.00%** 0.37%
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MML Blend Fund*** 0.37% 0.00%** 0.37%
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MML Equity Index Fund*** 0.30% 0.20% 0.50%
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MML Growth Equity Fund*** 0.80% 0.11%** 0.91%*
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MML Small Cap Growth Equity Fund*** 1.08% 0.11%** 1.19%*
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</TABLE>
*The MML Growth Equity Fund and the MML Small Cap Growth Equity Fund began
operations in 1999 and therefore, had no operating expenses as of December 31,
1998. The investment manager estimates that the total operating expenses for
these Funds in 1999 will be as shown.
**We agreed to bear expenses of the MML Equity Fund, MML Blend Fund, MML Small
Cap Value Equity Fund, MML Growth Equity Fund and MML Small Cap Growth Equity
Fund (other than the management fee, interest, taxes, brokerage commissions and
extraordinary expenses) in excess of 0.11% of the average daily net asset value
of the Funds through April 30, 2000. The expenses shown for the MML Growth
Equity Fund and MML Small Cap Growth Equity Fund include this reimbursement. If
not included, the other expenses for these Funds in 1999 are estimated to be
025%, for the MML Growth Equity Fund and 0.25% for the MML Small Cap Growth
Equity Fund. We do not expect that we will be required to reimburse any expenses
of the MML Equity Fund, MML Blend Fund and MML Small Cap Value Equity Fund in
1999.
***Subject to state availability
****A portion of the brokerage commissions that the VIP II Contrafund Portfolio
pays was used to reduce the other expenses for the Portfolio. In addition, this
Portfolio has entered into arrangements with its custodian whereby credits
realized as a result of uninvested cash balances were used to reduce custodian
expenses. Without such reductions, the other expenses for this Portfolio would
have been 0.11%, increasing the total fund operating expenses to 0.70%.
(See the funds' prospectuses for more information.)
6 Table Of Fees & Expenses
<PAGE>
Examples
The following examples are designed to help you understand the expenses in the
contract. The examples show the cumulative expenses you would pay assuming you
invested $1,000 in a contract and allocated all of it to a fund which earned 5%
each year. All the expenses shown in the table of fees and expenses, including
the annual fund expenses, are assumed to apply. In the first example it is
assumed that you withdrew all of your money at the end of years 1, 3, 5 or 10.
Year 1 3 5 10
- --------------------------------------------------------------------------------
Money Sub-Account $85 $112 $138 $233
- --------------------------------------------------------------------------------
Bond Sub-Account 88 120 150 258
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LifeSpan Diversified Income Sub-Account 89 122 156 269
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Total Return Sub-Account 86 114 141 238
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LifeSpan Balanced Sub-Account 90 125 160 278
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LifeSpan Capital Appreciation Sub-Account 90 125 160 278
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Growth Sub-Account 86 113 140 236
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International Equity Sub-Account 91 130 168 294
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Contrafund Sub-Account 87 118 148 254
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Income & Growth Sub-Account 87 118 148 254
- --------------------------------------------------------------------------------
Mid-Cap Growth Sub-Account 89 123 156 270
- --------------------------------------------------------------------------------
Small Cap Value Equity Sub-Account 85 111 135 227
- --------------------------------------------------------------------------------
Equity Sub-Account* 84 109 131 219
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Blend Sub-Account* 84 109 131 219
- --------------------------------------------------------------------------------
Equity Index Sub-Account* 85 112 138 233
- --------------------------------------------------------------------------------
Growth Equity Sub-Account* 89 124 159 276
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Small Cap Growth Equity Sub-Account* 92 133 173 304
- --------------------------------------------------------------------------------
* Subject to state availability
Table Of Fees & Expenses 7
<PAGE>
This second example assumes 1) that you did not make a withdrawal or 2) that you
decided to begin the income phase at the end of each year shown. (The income
phase is not available until the end of the 5th contract year.)
Year 1 3 5 10
- --------------------------------------------------------------------------------
Money Sub-Account $20 $63 $108 $233
- --------------------------------------------------------------------------------
Bond Sub-Account 23 70 120 258
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LifeSpan Diversified Income Sub-Account 24 73 126 269
- --------------------------------------------------------------------------------
Total Return Sub-Account 21 64 111 238
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LifeSpan Balanced Sub-Account 25 76 130 278
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LifeSpan Capital Appreciation Sub-Account 25 76 130 278
- --------------------------------------------------------------------------------
Growth Sub-Account 21 64 110 236
- --------------------------------------------------------------------------------
International Equity Sub-Account 26 81 138 294
- --------------------------------------------------------------------------------
Contrafund Sub-Account 22 69 118 254
- --------------------------------------------------------------------------------
Income & Growth Sub-Account 22 69 118 254
- --------------------------------------------------------------------------------
Mid-Cap Growth Sub-Account 24 74 126 270
- --------------------------------------------------------------------------------
Small Cap Value Equity Sub-Account 20 61 105 227
- --------------------------------------------------------------------------------
Equity Sub-Account* 19 59 101 219
- --------------------------------------------------------------------------------
Blend Sub-Account* 19 59 101 219
- --------------------------------------------------------------------------------
Equity Index Sub-Account* 20 63 108 233
- --------------------------------------------------------------------------------
Growth Equity Sub-Account* 25 76 129 276
- --------------------------------------------------------------------------------
Small Cap Growth Equity Sub-Account* 27 84 143 304
- --------------------------------------------------------------------------------
* Subject to state availability
The purpose of the Table of Fees and Expenses is to assist you in understanding
the various costs and expenses that you will incur. The table reflects expenses
of the separate account and the funds.
The examples reflect the $30 annual contract maintenance charge as an annual
charge of 0.086 % of the assets. This charge is based on an anticipated average
contract value of $35,000.
The examples do not reflect any premium taxes. However, premium taxes may apply.
The examples should not be considered a representation of past or future
expenses. Actual expenses may be greater or less than those shown.
There is an accumulation unit value history contained in Appendix A - Condensed
Financial Information.
8 Table Of Fees & Expenses
<PAGE>
The Company
C.M. Life Insurance Company, 140 Garden Street, Hartford, Connecticut 06154, is
a stock life insurance company. It was chartered by a special Act of the
Connecticut General Assembly on April 25, 1980. It is principally engaged in the
sale of life insurance and annuities, and is licensed in all states except New
York. The Company is a wholly-owned subsidiary of Massachusetts Mutual Life
Insurance Company (MassMutual).
MassMutual is a mutual life insurance company specially chartered by the
Commonwealth of Massachusetts on May 14, 1851. It is currently licensed to
transact life, accident, and health insurance business in all states, the
District of Columbia, Puerto Rico and certain provinces of Canada. MassMutual
had consolidated statutory assets in excess of $67 billion and estimated total
assets under management of $176.8 billion as of December 31, 1998.
The Panorama Premier Deferred Variable Annuity Contract
General Overview
This annuity is a contract between you, the owner and us, C.M. Life. The
contract is intended for retirement savings or other long-term investment
purposes. In exchange for your purchase payments, we agree to pay you an income
when you choose to receive it. You select the income period beginning on a date
you designate that is at least 5 years in the future. The contract, like all
deferred annuity contracts, has two phases - the accumulation phase and the
income phase. Your contract is in the accumulation phase until you decide to
begin receiving annuity payments. During the accumulation phase we provide a
death benefit. Once you begin receiving annuity payments, your contract enters
the income phase.
You are not taxed on contract earnings until you take money from your contract.
This is known as tax deferral.
The contract is called a variable annuity because you can choose to allocate
your purchase payments among various investment choices. Your choices include
seventeen funds and two fixed accounts. The amount of money you are able to
accumulate in your contract during the accumulation phase depends upon the
investment performance of the funds you select as well as the interest we credit
on the fixed accounts.
At the beginning of the income phase, you can choose to receive annuity payments
on a variable basis, fixed basis or a combination of both. If you choose
variable payments, the amount of the annuity payments will fluctuate depending
on the investment performance of the funds you select for the income phase. If
you select to receive payments on a fixed basis, the payments you receive will
remain level.
The Company/General Overview 9
<PAGE>
Ownership of the Contract
Owner
The owner is named at time of application. The owner can be an individual or a
non-natural person. We will not issue a contract to you if you have reached your
85th birthday as of the date we proposed to issue the contract.
As the owner of the contract, you exercise all rights under the contract. The
owner names the beneficiary. You may change the owner of the contract at any
time prior to the annuity date by written request. If you change the owner, the
change is subject to our underwriting rules. Changing the owner may result in
tax consequences. On and after the annuity date, you continue as the owner.
Joint Owner
The contract can be owned by joint owners. Unless prohibited by state law, only
you and your spouse can be joint owners. We will not issue a contract to you if
either proposed joint owner has reached their 85th birthday as of the date we
proposed to issue the contract.
Upon the death of either joint owner, the surviving spouse will be the
designated beneficiary and may continue the contract. We will treat any other
beneficiary designation at the time of death as a contingent beneficiary. Unless
otherwise indicated on the application, both signatures will be required for all
transactions, if there are joint owners.
Annuitant
The annuitant is the person on whose life we base annuity payments. You
designate the annuitant at the time of application. We will not issue a contract
to you if the proposed annuitant has reached his/her 85th birthday as of the
date we proposed to issue the contract. You may change the annuitant before the
annuity date, subject to our underwriting rules. However, the annuitant may not
be changed on a contract owned by a non-natural person.
Beneficiary
The beneficiary is the person(s) or entity you name to receive any death
benefit. You name the beneficiary at the time of application. Unless an
irrevocable beneficiary has been named, you can change the beneficiary at any
time before you die.
A beneficiary who is your surviving spouse may elect to continue the contract in
his or her own name, elect a lump sum payment of the death benefit, or apply the
death benefit to an annuity option.
10 Ownership of the Contract
<PAGE>
Purchasing a Contract
Purchase Payments
The minimum amount we accept for your initial
purchase payment is:
o $5,000 when the contract is bought as a non- qualified contract; or
o $2,000 if you are buying the contract as part of an IRA (Individual
Retirement Annuity), 401(k) or other qualified plan.
You can make additional purchase payments of $250 or more to either type of
contract. We will accept as little as $100 if you have selected our automatic
investment plan option.
The maximum amount of cumulative purchase payments we accept without our prior
approval is based on your age when we issued the contract.
The maximum amount is:
o $1 million up to your 76th birthday; or
o $500,000 if age 76 or older.
If the owner is not a natural person, these purchase payment limits will apply
to the annuitant's age. If there are joint owners, age refers to the oldest
owner.
You may make your initial purchase payment, along with your complete
application, by giving them to your agent/broker. You can make additional
purchase payments:
o by mailing your check that clearly indicates
your name and contract number to our lockbox:
MassMutual Panorama Premier
P.O. Box 92851
Chicago IL 60675-2851
o by instructing your bank to wire transfer funds to:
Chase Manhattan Bank, New York, New York
ABA #021000021
MassMutual Account 323065422
Ref: VA Income Contract #
Name: (Your Name)
We have the right to reject any application or purchase payment.
Allocation of Purchase Payments
When you purchase your contract, you choose how we will apply your purchase
payments among the investment choices. If you make additional purchase payments,
we will apply them in the same way as your first purchase payment, unless you
tell us otherwise.
Once we receive your purchase payment and the necessary information at our
Annuity Service Center or lockbox, we will issue your contract and apply your
first purchase payment within 2 business days. If you do not give us all of the
information we need, we will contact you to get it. If for some reason we are
unable to complete this process within 5 business days, we will either send back
your money or get your permission to keep it until we get all of the necessary
information.
If you add more money to your contract by making additional purchase payments,
we will credit these amounts to your contract on the business day we receive
them at our Annuity Service Center or lockbox. Our business day closes when the
New York Stock Exchange closes, usually 4:00 p.m. Eastern time. If we receive
your purchase payment at our Annuity Service Center or lockbox on a non-business
day or after the business day closes, we will credit the amount to your contract
effective the next business day.
Purchasing a Contract 11
<PAGE>
Investment Choices
The Separate Account
We established a separate account, C.M. Multi-Account A (separate account), to
hold the assets that underlie the contracts. Our Board of Directors adopted a
resolution to establish the separate account under Connecticut insurance law on
August 3, 1994. We have registered the separate account with the Securities and
Exchange Commission as a unit investment trust under the Investment Company Act
of 1940.
C.M. Life owns the assets of the separate account. However, those separate
account assets equal to the reserves and other contract liabilities are not
chargeable with liabilities arising out of any other business we may conduct.
All the income, gains and losses (realized or unrealized) resulting from these
assets are credited to, or charged against, the contracts and not against any
other contracts we may issue.
C.M. Life established a segment of the separate account for Panorama Premier
contracts. We currently divide this segment into 17 sub-accounts. Each of these
sub-accounts invests in a fund. You bear the complete investment risk for
purchase payments that you allocate to a fund.
The Funds
Subject to state availability, the contract offers 17 funds which are listed
below. Additional funds may be added in the future.
Panorama Series Fund, Inc.
Panorama Series Fund, Inc. ("Panorama Fund") is an open-end investment company.
OppenheimerFunds, Inc. ("OFI"), an investment adviser registered with the SEC
under the Investment Advisers Act of 1940, as amended, ("Investment Advisers
Act") is the investment adviser to the Panorama Fund. It performs administrative
functions relative to the Panorama Fund, including the keeping of all records
not maintained by the custodian. OFI has operated as an investment adviser since
1959 and, together with a subsidiary, manages companies with $95 billion in
assets and 4 million shareholder accounts as of December 31, 1998. OFI is owned
by Oppenheimer Acquisition Corporation, a holding company that is owned in part
by senior officers for OFI and controlled by MassMutual. The address of OFI is
Two World Trade Center, New York, NY 10048-0203.
OFI has engaged three subadvisors to assist in the selection of portfolio
investments for the Panorama International Equity Portfolio, the Panorama
LifeSpan Diversified Income Portfolio, the Panorama LifeSpan Balanced Portfolio,
and the Panorama LifeSpan Capital Appreciation Portfolio.
Babson-Stewart Ivory International ("Babson-Stewart"), One Memorial Drive,
Cambridge, MA 02142, is the subadviser to the Panorama International Equity
Portfolio and the international stock components of the Panorama LifeSpan
Balanced Portfolio and the Panorama LifeSpan Capital Appreciation Portfolio.
Babson-Stewart is a partnership formed in 1987 between David L. Babson & Co.,
Inc., a subsidiary of MassMutual and Stewart Ivory & Co., Ltd., located in
Edinburgh, Scotland.
Credit Suisse Asset Management, One Citicorp Center, 153 East 53rd St., New
York, New York, is the subadviser to the high yield bond components of the three
Panorama LifeSpan Portfolios. Prior to January 12, 1999, Credit Suisse Asset
Management was called BEA Associates.
Pilgrim, Baxter & Associates ("Pilgrim Baxter"), 825 Duportail Road, Wayne, PA
19087, is the subadviser to the small cap components of the Panorama LifeSpan
Balanced Portfolio and the Panorama LifeSpan Capital Appreciation Portfolio.
Panorama LifeSpan Diversified Income Portfolio (Diversified Income Portfolio).
The Diversified Income Portfolio seeks high current income, with opportunities
for capital appreciation through a strategically allocated portfolio consisting
primarily of bonds.
12 Investment Choices
<PAGE>
Panorama Total Return Portfolio. The Panorama Total Return Portfolio seeks to
maximize total investment return (including both capital appreciation and
income) by allocating its assets among stocks, corporate bonds, U.S. Government
securities and its instrumentalities, and money market instruments according to
changing market conditions.
Panorama LifeSpan Balanced Portfolio (Balanced Portfolio). The Balanced
Portfolio seeks a blend of capital appreciation and income through a
strategically allocated portfolio of stocks and bonds with a slightly stronger
emphasis on stocks.
Panorama LifeSpan Capital Appreciation Portfolio (Capital Appreciation
Portfolio). The Capital Appreciation Portfolio seeks long-term capital
appreciation through a strategically allocated portfolio consisting primarily of
stocks. Current income is not a primary consideration.
Panorama Growth Portfolio. The Panorama Growth Portfolio seeks long-term growth
of capital by investing primarily in common stocks with low price-earnings
ratios and better than anticipated earnings. Realization of current income is a
secondary consideration.
Panorama International Equity Portfolio. The Panorama International Equity
Portfolio seeks long-term growth of capital by investing primarily in equity
securities of companies wherever located, the primary stock market of which is
outside the United States.
Oppenheimer Variable Account Funds
Oppenheimer Variable Account Funds ("Oppenheimer Funds") is an investment
company consisting of 10 separate series of shares known as funds. The
Oppenheimer Funds are also advised by OFI.
Oppenheimer Bond Fund/VA. The Oppenheimer Bond Fund/VA seeks a high level of
current income. The Fund seeks capital growth when consistent with its primary
objective. This Fund will, under normal market conditions, invest at least 65%
of its total assets in investment grade debt securities.
Oppenheimer Money Fund/VA. The Oppenheimer Money Fund/VA seeks maximum current
income from investments in money market securities that is consistent with low
capital risk and maintenance of liquidity. The Fund invests in short-term, high
quality "money market" securities.
MML Series Investment Fund ("MML Trust")
MML Trust is a no-load, open-end, investment company having eight series of
shares each of which has different investment objectives designed to meet
different investment needs. MassMutual serves as the investment adviser to the
MML Trust.
MassMutual has entered into a subadvisory agreement with David L. Babson and
Company, Inc. ("Babson"), a controlled subsidiary of the MassMutual, whereby
Babson manages the investment of the assets of the MML Small Cap Value Equity
Fund, the MML Equity Fund, and the equity sector of the MML Blend Fund.
MassMutual has entered into a subadvisory agreement with Massachusetts Financial
Services Company ("MFS"), whereby MFS manages the investment of the MML Growth
Equity Fund.
MassMutual has entered into subadvisory agreements with J.P. Morgan Investment
Management Company Inc. ("J.P. Morgan") and Waddell & Reed Investment Management
Company ("Waddell & Reed"), whereby J.P. Morgan and Waddell & Reed each manage
50% of the portfolio of MML Small Cap Growth Equity Fund.
MassMutual has entered into a subadvisory agreement with Mellon Equity
Associates, LLP ("Mellon Equity") whereby Mellon Equity manages the investments
of the MML Equity Index Fund.
MML Small Cap Value Equity Fund. The MML Small Cap Value Equity Fund seeks
growth of capital and income over time by investing primarily in small company
stocks.
MML Equity Fund.* The MML Equity Fund seeks to achieve a superior rate of return
over time from both capital appreciation and current income and to preserve
capital by investing in equity securities.
*Subject to state availability.
Investment Choices 13
<PAGE>
MML Blend Fund* The MML Blend Fund seeks a high total rate of return over time,
consistent with prudent investment risk and capital preservation, by investing
in equity, fixed income and money market securities.
* Subject to state availability.
MML Equity Index Fund* The MML Equity Index Fund seeks investment results that
correspond to the price and yield performance of publicly traded common stocks
in the aggregate, as represented by the Standard & Poor's 500 Composite Stock
Price Index.1
* Subject to state availability.
1 "Standard & Poor's, " Standard & Poor's 500" and "S&P 500" are trademarks of
The McGraw-Hill Companies and have been licensed for use by the Fund. The Fund
is not sponsored, endorsed, sold or promoted by Standard & Poor's, a division of
The McGraw-Hill Companies ("S&P"), or The McGraw-Hill Companies, Inc. Standard &
Poor's makes no representation regarding the advisability of investing in the
Fund.
MML Growth Equity Fund* The MML Growth Equity Fund seeks growth of capital and
income over time by investing primarily in equity securities of large companies
with long-term growth potential.
* Subject to state availability.
MML Small Cap Growth Equity Fund* The MML Small Cap Growth Equity Fund seeks
growth of capital over time by investing primarily in equity securities of
smaller and medium-size companies with long-term growth potential.
* Subject to state availability.
T. Rowe Price Equity Series, Inc.
T. Rowe Price Equity Series, Inc. is a diversified, open-end investment company
incorporated in Maryland in 1994. The T. Rowe Price Mid-Cap Growth Portfolio is
a separate series of shares of T. Rowe Price Equity Series, Inc. T. Rowe Price
Associates, Inc. (" T. Rowe Price") was founded in 1937 and is the investment
adviser to the Portfolio. Its business address is 100 East Pratt Street,
Baltimore, MD 21202.
T. Rowe Price Mid-Cap Growth Portfolio. The T. Rowe Price Mid-Cap Growth
Portfolio seeks long-term capital appreciation by investing in mid-cap stocks
with potential for above-average earnings growth. T. Rowe Price defines mid-cap
companies as those with market capitalizations within the range of companies in
the S&P 400 Mid-Cap Index.
American Century Variable Portfolios, Inc.
American Century Variable Portfolios, Inc. ("American Century VP") was organized
as a Maryland corporation in 1987 and is a diversified, open-end management
investment company. American Century Investment Management, Inc. ("American
Century") is the investment manager of American Century VP. American Century has
been providing investment advisory services to investment companies and
institutional investors since it was founded in 1958. American Century's address
is American Century Tower, 4500 Main Street, Kansas City Missouri 64111.
American Century VP Income & Growth Portfolio. The American Century VP Income &
Growth Portfolio seeks dividend growth, income and capital appreciation by
investing in common stocks.
Fidelity Variable Insurance Products Fund II
Fidelity Variable Insurance Products Fund II ("VIP II") is an open-end
management investment company, organized as a Massachusetts business trust in
1988. Fidelity's VIP II Contrafund Portfolio is a diversified fund of VIP II.
Fidelity Management & Research Company ("FMR") is the investment adviser to
Fidelity's VIP II Contrafund Portfolio. FMR is the management arm of Fidelity
Investments. Fidelity Investment has its principal business address at 82
Devonshire Street, Boston, MA 02109.
Fidelity Management & Research (U.K.) Inc. in London, England, and Fidelity
Management & Research (Far East) Inc., in Tokyo, Japan, assist FMR with foreign
investments. They each serve as subadvisors for Fidelity's VIP II Contrafund
Portfolio.
Fidelity's VIP II Contrafund Portfolio. Fidelity's VIP II Contrafund Portfolio
seeks long term
14 Investment Choices
<PAGE>
capital appreciation by investing in the securities of companies whose value is
not fully recognized by the public.
There is no assurance that the funds will achieve their stated objective. The
fund prospectuses contain more detailed information about the funds. Current
copies of the fund prospectuses are attached to this prospectus. You should read
the information contained in the funds' prospectuses carefully before investing.
The Fixed Accounts
In most states, we offer two fixed accounts, the fixed account for Dollar Cost
Averaging (the "DCA Fixed Account") and The Fixed Account (collectively, "the
fixed accounts"), as investment options. The fixed accounts are investment
options within our general account.
Amounts that you allocate to the fixed accounts become part of our general
account assets and are subject to the claims of all our creditors. All of our
general account assets will be available to fund benefits under a contract.
DCA Fixed Account. The DCA Fixed Account is a fixed account from which assets
are systematically transferred to any fund(s). During the accumulation phase,
you may choose to have your purchase payments allocated to the DCA Fixed Account
for the period of the DCA Fixed Account Term (DCA Term). Your election must be
in writing.
Currently, the DCA Term will not exceed 12 months. To the extent permitted by
law, we reserve the right to change the duration of the DCA Term in the future.
You may have only one DCA Term at a time.
We will only accept a purchase payment as of the beginning of a DCA Term.
Purchase payments which originate from an annuity contract issued by us or any
of our affiliates cannot be allocated to the DCA Account. You cannot transfer
current contract values to the DCA Fixed Account. We reserve the right to reject
purchase payments.
We make scheduled monthly transfers from the DCA Fixed Account according to the
rules of our Dollar Cost Averaging Program. You may not make unscheduled
transfers or take partial withdrawals from the DCA Fixed Account. If you
withdraw the entire contract value during a DCA term we will apply our normal
withdrawal provisions.
We reserve the right to assess a fee for processing transactions under the DCA
Fixed Account.
If you elect to make an allocation to the DCA Fixed Account at a time when your
annuity date would be less than the currently offered DCA Term, the expiration
of your DCA Term will be your annuity date. No amounts will remain in the DCA
Fixed Account after the expiration of the DCA Term.
We periodically set the interest rate we credit to the DCA Fixed Account. The
interest rate is never less than 3%. We guarantee the interest rate for the full
DCA Term.
The Fixed Account. You may allocate purchase payments to The Fixed Account. You
can also make transfers of your contract value into The Fixed Account. You do
not participate in the investment performance of the assets in The Fixed
Account. Instead, we credit your contract with interest at a specified rate that
we declare in advance. We guarantee this rate will be at least 3% per year. We
may credit a higher rate of interest at our discretion.
Investment Choices 15
<PAGE>
Contract Value
Your contract value is the sum of your value in the separate account and the
fixed account(s).
Your value in the separate account will vary depending on the investment
performance of the funds you choose. In order to keep track of your contract
value, we use a unit of measure called an accumulation unit. During the income
phase of your contract we call the unit an annuity unit.
Accumulation Units
Every day we determine the value of an accumulation unit for each of the funds.
Changes in the accumulation unit value reflect the investment performance of the
fund as well as deductions for insurance and other changes.
The value of an accumulation unit may go up or down from business day to
business day.
The Statement of Additional Information contains more information on the
calculation of the accumulation unit value.
When you make a purchase payment, we credit your contract with accumulation
units. We determine the number of accumulation units to credit by dividing the
amount of the purchase payment allocated to a fund by the value of the
accumulation unit for that fund. When you make a withdrawal, we deduct from your
contract accumulation units representing the withdrawal amount.
We calculate the value of an accumulation unit for each investment portfolio
after the New York Stock Exchange closes each business day. Any change in the
accumulation unit value will be reflected in your contract value.
Example:
On Monday we receive an additional purchase payment of $5,000 from you. You have
told us you want this to go to the Oppenheimer Bond Fund/VA. When the New York
Stock Exchange closes on that Monday, we determine that the value of an
accumulation unit for the Oppenheimer Bond Fund/VA is $13.90. We then divide
$5,000 by $13.90 and credit your contract on Monday night with 359.71
accumulation units for the Oppenheimer Bond Fund/VA.
Transfers
You can transfer all or part of your contract value. You can make transfers by
telephone. To do so, you must submit a written request. If you own the contract
with a joint owner, we will accept telephone transfer instructions from either
you or the other owner, unless we are instructed otherwise. We will use
reasonable procedures to confirm that instructions given to us by telephone are
genuine. We may be liable for any losses due to unauthorized or fraudulent
instructions, if we fail to use such procedures. We may tape record all
telephone instructions.
Your transfer is effective on the business day we receive your request at our
Annuity Service Center. Our business day closes when the New York Stock Exchange
closes, usually 4:00 p.m. Eastern time. If we receive your transfer request at
our Annuity Service Center on a non-business day or after our business day
closes, your transfer request will be effective on the next business day.
Transfers During the Accumulation Phase
You may transfer all or part of your assets in a fund or The Fixed Account. You
can make a transfer to or from The Fixed Account and to or from any fund. You
can make 12 transfers every calendar year during the accumulation phase without
charge. If you make more than 12 transfers in a year, we will deduct a transfer
fee. The fee is $20 per transfer or, if less, 2% of the amount you transfer. The
following rules apply to any transfer during the accumulation phase:
(1) The minimum amount which you can transfer is:
o $1,000; or
o the entire value in a fund, if less.
16 Contract Value
<PAGE>
After a transfer, the minimum amount which must remain in the fund is $1,000
unless you transfer the entire fund value. We waive these requirements if the
transfer is made in connection with the Rebalancing Program.
(2) You must clearly indicate the amount and investment choices from and to
which you wish to transfer.
(3) During any contract year, we limit transfers out of The Fixed Account to
the greater of $30,000 or 30% of your contract value in The Fixed Account
as of the end of the previous contract year. We measure a contract year
from the anniversary of the day we issued your contract. Transfers out of
The Fixed Account are done on a first-in, first-out basis. In other words,
amounts attributed to the oldest purchase payments are transferred first;
then amounts attributed to the next oldest purchase payment are
transferred; and so on.
(4) We do not allow transfers between competing accounts. For this purpose, we
consider The Fixed Account and the Oppenheimer Money Fund/VA "competing
accounts." We restrict other transfers involving any competing account for
certain periods:
o for a period of 90 days following a transfer out of a competing
account, you may not transfer into the other competing account.
o for a period of 90 days following a transfer into a competing
account, you may not transfer out of the other competing account.
(5) We do not count transfers made as part of the Dollar Cost Averaging
Program or the Rebalancing Program in determining the number of transfers
you make in a year.
Transfers During the Income Phase
You may make 6 transfers between the funds each calendar year without incurring
a fee. You cannot transfer from the general account to a fund, but you can
transfer from one or more funds to the general account once a contract year. The
minimum amount which you can transfer is $1,000 or your entire interest in the
fund, if less. After a transfer, the minimum amount which must remain in a fund
is $1,000 unless you have transferred the entire value.
We have the right to terminate or modify these transfer provisions.
Dollar Cost Averaging Program
The Dollar Cost Averaging Program allows you to systematically transfer a set
amount from a selected fund to any of the other funds. By allocating amounts on
a regular schedule as opposed to allocating the total amount at one particular
time, you may be less susceptible to the impact of market fluctuations. The
Dollar Cost Averaging Program is available only during the accumulation phase.
Dollar Cost Averaging does not assure a profit and does not protect you against
loss in declining markets. Since Dollar Cost Averaging involves continuous
investment in securities regardless of fluctuating price levels of such
securities, you should consider your financial ability to continue the Dollar
Cost Averaging Program through periods of fluctuating price levels.
You must have a contract value of at least $5,000 in order to participate in the
Dollar Cost Averaging Program. The minimum amount you can transfer is $250.
The minimum duration of participation in any Dollar Cost Averaging Program is
currently 6 months. You can choose the frequency at which the Dollar Cost
Averaging transfers are to be made, i.e., monthly, quarterly, semi-annually or
annually. You will also choose the specific date when the first Dollar Cost
Averaging transfer is made. However, if you select a date that is less than 5
business days from the date the election form is received at our Annuity Service
Center, we may defer the first transfer for one month. If you do not select a
start date, we will automatically start the Dollar Cost Averaging Program within
5 business days from the date we receive your election form. You may make
changes to your selection, including termination of the program, by written
request.
Contract Value 17
<PAGE>
If you participate in the Dollar Cost Averaging Program, we do not take the
transfers made under the program into account in determining any transfer fee.
We consider the DCA Fixed Account to be a Dollar Cost Averaging Program. You can
only participate in one Dollar Cost Averaging Program at a time. Further, if you
are participating in the Dollar Cost Averaging Program you cannot also
participate in the Rebalancing Program, the Systematic Withdrawal Plan or the
DCA Fixed Account.
The Dollar Cost Averaging option will terminate:
o if you withdraw the total contract value;
o upon your death or the annuitant's death;
o if the last transfer you selected has been made;
o if there is insufficient contract value to make the transfer; or
o if we receive from you a written request to terminate the program at our
Annuity Service Center at least 5 business days prior to the next transfer
date.
We currently do not charge you for participation in the Dollar Cost Averaging
Program. However, we reserve the right to charge for this feature in the future.
We have the right to modify, terminate or suspend the Dollar Cost Averaging
Program.
Automatic Rebalancing Program
Over time, the performance of each fund may cause your allocation to shift from
your original allocation. You can direct us to automatically rebalance your
contract to return to your original percentage allocations by selecting our
Rebalancing Program. You can tell us whether to rebalance monthly, quarterly,
semi-annually or annually. The Rebalancing Program is available only during the
accumulation phase. If you participate in the Rebalancing Program, the transfers
made under the program are not taken into account in determining any transfer
fee.
You cannot participate in the Rebalancing Program if you have purchase payments
allocated to the fixed accounts. You cannot participate in the Rebalancing
Program if you are participating in a Dollar Cost Averaging Program.
You can terminate the Rebalancing Program at anytime by giving us written
notice. Any unscheduled transfer request will automatically terminate the
Rebalancing Program election.
Example:
Assume that you want your initial purchase payment split between 2 funds. You
want 40% to be in the Oppenheimer Bond Fund and 60% to be in the Panorama Growth
Fund. Over the next 2 1/2 months the bond market does very well while the stock
market performs poorly. At the end of the first quarter, the Oppenheimer Bond
Fund now represents 50% of your holdings because of its increase in value. If
you had chosen to have your holdings rebalanced quarterly, on the first day of
the next quarter, we would sell some of your units in the Oppenheimer Bond Fund
to bring its value back to 40% and use the money to buy more units in the
Panorama Growth Portfolio to increase those holdings to 60%.
Withdrawals
During the accumulation phase you may make either partial or total withdrawals
of your contract value. Your withdrawal is effective on the business day we
receive your written request at our Annuity Service Center. If we receive your
written request at our Annuity Service Center on a non-business day or after our
business day closes, your withdrawal request will be effective on the next
business day. We will pay any withdrawal amount within 7 days of our receipt of
your fully completed written request at our Annuity Service Center unless we are
required to suspend or postpone withdrawal payments.
Unless you instruct us otherwise, we will take any partial withdrawal
proportionally from your contract value in the funds and The Fixed Account. You
must withdraw at least $250 or the entire value in a fund or The Fixed Account,
if less. We require that after you make a partial withdrawal you keep at least
$5,000 in a non-qualified contract. For qualified contracts, the amount is
$2,000. Partial withdrawals are subject to a contingent deferred sales charge.
18 Contract Value
<PAGE>
When you make a total withdrawal you will receive the value of your contract:
o less any applicable contingent deferred sales charge;
o less any applicable premium tax;
o less any contract maintenance charge, and
o less any purchase payments we credited to your contract that have not
cleared the bank, until they clear the bank.
Systematic Withdrawal Program
This program provides for an automatic monthly, quarterly, semi-annual or annual
payment to you from your contract of at least $250. Your contract value must be
at least $25,000 to initiate the withdrawal plan. Currently, we do not have a
charge for this program, but we reserve the right to charge in the future.
Your systematic withdrawal program will begin on the start date you selected as
long as we receive a fully completed written request at least 5 business days
before the start date you selected. We may defer the start of your systematic
withdrawal program for one month if the start date you selected is less than 5
business days after we receive your written request. If you do not select a
start date, we will automatically begin systematic withdrawals within 5 business
days after we receive your request. Your request must be in writing.
If you are participating in the Automatic Investment Plan Option, the
Rebalancing Program or a Dollar Cost Averaging Program you cannot also
participate in the Systematic Withdrawal Plan. If you terminate your Systematic
Withdrawal Plan from The Fixed Account, you may not elect a new plan involving
withdrawals from The Fixed Account for 6 months.
Your systematic withdrawal program ends:
o if you withdraw your total contract value;
o upon your death or the annuitant's death;
o if we process the last withdrawal you selected;
o if your value in a selected fund or The Fixed Account is insufficient to
complete the withdrawal;
o if you begin receiving annuity payments; or
o if you give us a written request to terminate your program. We must
receive your request at least 5 business days before the next withdrawal
date.
- --------------------------------------------------------------------------------
Income taxes, tax penalties and certain restrictions may apply to any withdrawal
you make.
- --------------------------------------------------------------------------------
Contract Value 19
<PAGE>
Expenses
There are charges and other expenses associated with the contracts that reduce
the return on your investment in the contract. These charges and expenses are:
Insurance Charges
Each business day we deduct our insurance charges from the assets of the
separate account. We do this as part of our calculation of the value of the
accumulation units and the annuity units. The insurance charge has two parts:
(1) the mortality and expense risk charge and (2) the administrative charge.
Mortality and Expense Risk Charge
This charge is equal, on an annual basis, to 1.25% of the daily value of the
assets invested in each fund, after fund expenses are deducted. This charge is
for:
o the mortality risk associated with the insurance benefits provided,
including our obligation to make annuity payments after the annuity date
regardless of how long all annuitants live, the death benefits, and the
guarantee of rates used to determine your annuity payments during the
income phase;
o the expense risk that the current charges will be insufficient to cover
the actual cost of administering the contract.
The mortality and expense risk charge cannot be increased. If the mortality and
expense risk charge is not sufficient, then we will bear the loss. However, we
do expect to profit from this charge.
Administrative Charge
This charge is equal, on an annual basis, to 0.15% of the daily value of the
contracts invested in each fund, after fund expenses are deducted. We assess
this charge, together with the annual contract maintenance charge, to reimburse
us for all the expenses associated with the administration of the contract and
the separate account. Some of these expenses are: preparation of the contract,
confirmations, annual reports and statements, maintenance of contract records,
personnel costs, legal and accounting fees, filing fees, and computer and
systems costs. We can increase this charge, but the charge will never exceed
0.25%. If we increase this charge, we will give you 90 days prior notice.
Annual Contract Maintenance Charge
At the end of each contract year, we deduct $30 from your contract as an annual
contract maintenance charge. We may increase this charge, but it will not exceed
$60. If we increase this charge, we will give you 90 days prior notice.
Currently, we will not deduct this charge if, when we are to make the deduction,
the value of your contract is $50,000 or more. However, we reserve the right to
increase the contract value amount at which we will waive this charge to
$100,000 as provided by the contract. Subject to state regulations, we will
deduct the annual contract maintenance charge proportionately from the
investment choices you have selected.
If you make a total withdrawal from your contract, and the contract value is
less than $50,000, we will deduct the full annual contract maintenance charge.
If your contract enters the income phase on a date other than its contract
anniversary and the contract value is less than $50,000, we will deduct a pro
rata portion of the charge. During the income phase, we will deduct 1/12th of
the annual contract maintenance charge from each payment regardless of the
contract size.
Contingent Deferred Sales Charge
We do not deduct a sales charge when we receive a purchase payment. However, we
may assess a contingent deferred sales charge on the amount you withdraw that
exceeds the free withdrawal amount. We use this charge to cover certain expenses
relating to the sale of the contract.
20 Expenses
<PAGE>
If you withdraw:
o from more than one investment choice, we will deduct the contingent
deferred sales charge proportionately from the amounts remaining in the
investment choice(s) you selected.
o the total value from an investment choice, we will deduct the contingent
deferred sales charge proportionately from amounts remaining in the
investment choices that still have value.
o your entire contract value, we will deduct the contingent deferred sales
from the contract value. You will receive a check for the net amount.
The amount of the charge depends on the amount of the purchase payments and the
length of time since you made the purchase payments. The contingent deferred
sales charge is assessed as follows:
Year since Purchase
Payments were Accepted Charge
- ---------------------- ------
- --------------------------------------------------------------------------------
1st Year 7%
- --------------------------------------------------------------------------------
2nd Year 6%
- --------------------------------------------------------------------------------
3rd Year 5%
- --------------------------------------------------------------------------------
4th Year 4%
- --------------------------------------------------------------------------------
5th Year 3%
- --------------------------------------------------------------------------------
6th Year 2%
- --------------------------------------------------------------------------------
7th Year 1%
- --------------------------------------------------------------------------------
8th Year
and thereafter 0%
After your purchase payment has been in the contract for 7 years, there is no
charge when you withdraw the purchase payment. Each purchase payment has its own
7-year sales charge period. We take withdrawals first from earnings, and then
from purchase payments. For purposes of the contingent deferred sales charge, we
treat withdrawals as coming from the oldest purchase payments first.
In addition to the free withdrawals described later in this section, we will not
impose a contingent deferred sales charge under the following circumstances.
o Upon payment of the death benefit or upon the amount applied to an annuity
payment option.
o If you surrender your contract before April 30, 2000, and the proceeds of
the surrender are used to purchase a new group annuity issued by
MassMutual. The group annuity may be subject to charges upon surrender.
o If you redeem "excess contributions" to a plan qualifying for special
income tax treatment. These types of plans are referred to as Qualified
Plans, including Individual Retirement Annuities (IRAs). We look to the
Internal Revenue Code for the definition and description of excess
contributions.
o Owners of certain IRAs or non-qualified Flex Extra Variable Annuity
contracts issued by MassMutual that no longer have any contingent deferred
sales charge may exchange these contracts for a Panorama Premier contract.
We call this the "Flex Extra Exchange Program." When you exchange an
eligible Flex Extra contract for a Panorama Premier contract, we do not
assess a contingent deferred sales charge on the amount that was in the
original Flex Extra contract. However, if you make any additional purchase
payments they will be subject to a contingent deferred sales charge.
o If you own an IRA or a non-qualified Account A, Account B or Account E
variable annuity contract previously issued by Connecticut Mutual Life
Insurance Company, you can exchange that contract for a Panorama Premier
contract. We call this the CML Exchange Program. When you exchange an
eligible Account A, Account B, or Account E contract for a Panorama
Premier contract, we do not assess a contingent deferred sales charge on
the amount that was in the original contract. However, if you make
additional purchase payments they will be subject to a contingent deferred
sales charge.
The exchange programs may not be available in all states. Check with your agent.
We have the right to terminate these exchange programs at any time. If you want
more information about the exchange programs, contact your agent or us at our
Annuity Service Center (800) 366-8226.
Expenses 21
<PAGE>
Free Withdrawals
You may withdraw, without incurring a contingent deferred sales charge, the
greater of:
o the part of your contract value that is earnings on the date of
withdrawal; or
o 10% of purchase payments remaining in your contract on the withdrawal date
reduced by any free withdrawal(s) you previously took during the current
contract year.
We take withdrawals first from any investment earnings, and then from purchase
payments. If you withdraw an amount which exceeds the free withdrawal amount, we
will reduce the amount of your remaining purchase payments. We will calculate
the contingent deferred sales charge based on your oldest purchase payments
first.
Premium Taxes
Some states and other governmental entities charge premium taxes or similar
taxes. We are responsible for the payment of these taxes and will make a
deduction from your contract value for them. Some of these taxes are due when
your contract is issued, others are due when annuity payments begin. Currently
we do not charge you for these taxes until you begin receiving annuity payments
or you make a total withdrawal. We may discontinue this practice and assess the
charge when the tax is due. Premium taxes generally range from 0% to 3.5%,
depending on the state.
Transfer Fee
During the accumulation phase, you can make 12 free transfers every calendar
year. If you make more than 12 transfers a calendar year, we will deduct a
transfer fee of $20 or 2% of the amount that is transferred, whichever is less.
If you request to transfer a dollar amount, we will deduct any transfer fee from
the amount transferred. If you request to transfer a percentage of your value in
an investment choice, we will deduct any transfer fee from the amount remaining
in the investment choice. If you transfer the entire amount in an investment
choice, we will deduct the transfer fee from the amount you transfer.
During the income phase, we allow 6 transfers and they are not subject to a
transfer fee. We consider all transfers made on one business day as one
transfer.
Income Taxes
We will deduct from the contract any income taxes which we incur because of the
operation of the separate account. At the present time, we are not making any
such deductions. We will deduct any withholding taxes required by law.
Fund Expenses
There are deductions from and expenses paid out of the assets of the various
funds, which are described in the attached fund prospectuses. We may enter into
certain arrangements under which we are reimbursed by the funds' advisors,
distributors and/or affiliates for the administrative service that we provide.
22 Expenses
<PAGE>
The Income Phase
If you want to receive regular income from your annuity, you can choose to
receive fixed and/or variable annuity payments under one of six options. You can
choose the month and year in which those payments begin. We call that date the
annuity date. Your annuity date must be the first day of a calendar month. Your
annuity date cannot be earlier than 5 years after you buy the contract.
You choose your annuity date when you purchase your contract. You can change it
at any time before the annuity date provided you give us 30 days written notice.
If you do not choose an annuity option, we will assume that you selected Option
B with 10 years of payments guaranteed.
Annuity payments must begin by the earlier of:
(1) The annuitant's 90th birthday or the 90th birthday of the oldest joint
annuitant;
(2) Your 90th birthday if you are not the annuitant or the 90th birthday of
the oldest joint owner; or
(3) The latest age permitted under state law.
We make annuity payments based on the age and sex of the annuitant under all
options except Option E. We may require proof of age and sex before annuity
payments begin.
At the annuity date, you have the same fund choices that you had in the
accumulation phase. You can choose whether payments will be fixed, variable, or
a combination of both. If you do not tell us otherwise, we will base your
annuity payments on the investment allocations that are in place on the annuity
date. Therefore, any amounts in the funds will be applied to a variable payout
and any amounts in the Fixed Account will be applied to a fixed payout.
If your contract value is less than $2,000 on the annuity date, we reserve the
right to pay you a lump sum rather than a series of annuity payments. If any
annuity payment is less than $100, we reserve the right to change the payment
basis to equivalent less frequent payments.
In order to avoid adverse tax consequences, you should begin to take
distributions at least equal to the minimum amount required by the Internal
Revenue Service, no later than the required beginning date. If your contract is
an IRA that date should be the year you reach age 70 1/2. For qualified plans,
that date is the later of your retirement or when you reach age 70 1/2.
Fixed Annuity Payments
If you choose fixed payments, the payment amount will not vary. The payment
amount will depend upon the following 5 things:
o the value of your contract on the annuity date;
o the deduction of premium taxes, if applicable,
o the deduction of the annual contract maintenance charge, and
o the annuity option you select, and
o the age and sex of the annuitant (and the age and sex of the joint
annuitant, if any).
Variable Annuity Payments
If you choose variable payments, the payment amount will vary with the
investment performance of the funds. The first payment amount will depend on the
following 6 things:
o the value of your contract on the annuity date;
o the deduction of premium taxes, if applicable,
o the deduction of the annual contract maintenance charge,
o the annuity option you select,
o the age and sex of the annuitant (and the age and sex of the joint
annuitant, if any), and
o an assumed investment rate (AIR) of 4% per year.
Future variable payments will depend on the performance of the funds you
selected. If the actual performance exceeds the 4% assumed investment rate plus
the deductions for expenses, your annuity payments will increase. Similarly, if
the actual rate is less than 4% plus the amount of the deductions, your annuity
payments will decrease.
The Income Phase 23
<PAGE>
Annuity Unit Value
In order to keep track of the value of your variable annuity payment, we use a
unit of measure called an annuity unit. We calculate the number of your annuity
units at the beginning of the income phase. During the income phase, the number
of annuity units will not change. However, the value of your annuity units will
change to reflect the investment performance of the funds you selected. The
Statement of Additional Information contains more information on how annuity
payments and annuity unit values are calculated.
Annuity Options
The following annuity options are available. After annuity payments begin, you
cannot change the annuity option or the frequency of annuity payments. In
addition, during the income phase we do not allow withdrawals.
Annuity Option A - Life Income. Under this option we make periodic payments as
long as the annuitant is alive. After the annuitant dies we stop making
payments.
Annuity Option B - Life Income with Period Certain. We will make periodic
payments for a guaranteed period, or as long as the annuitant lives, whichever
is longer. The guaranteed period may be 5, 10 or 20 years. If the beneficiary
chooses, he/she may elect a lump sum payment equal to the present value of the
remaining guaranteed annuity payments.
Annuity Option C - Joint and Last Survivor Payments. We will make periodic
payments during the joint lifetime of 2 annuitants. When one dies, we will
continue making these payments to the survivor as if both annuitants were alive.
We will not make payments after both annuitants have died.
Annuity Option D - Joint and 2/3 Survivor Annuity. We will make periodic
payments during the joint lifetime of 2 annuitants. We will continue making
payments during the lifetime of the surviving annuitant. We will compute these
payments for the surviving annuitant on the basis of two-thirds of the annuity
payment (or units) in effect during the joint lifetime. We will not make
payments after both annuitants have died.
Annuity Option E - Period Certain. We will make periodic payments for a
specified period. The specified period must be at least 5 years and cannot be
more than 30 years. In most states, if you do not want payments to continue for
the remainder of the specified period, you may elect to have an amount equal to
the present value of the remaining guaranteed annuity payments paid as a lump
sum or applied to another annuity option.
Annuity Option F - Special Income Settlement Agreement. We will pay you in
accordance with terms agreed upon in writing by both you and us.
24 The Income Phase
<PAGE>
Death Benefit
Death Of Contract Owner During The Accumulation Phase
If you or the joint owner dies during the accumulation phase, we will pay a
death benefit to your primary beneficiary. If the joint owner dies, we will
treat the surviving joint owner, if any, as the primary beneficiary. We will
treat any other beneficiary designation on record at the time of death as a
contingent beneficiary unless you have changed it in writing.
Your beneficiary may request that the death benefit be paid under one of the
death benefit options. If the beneficiary is your spouse, he or she may elect to
become the owner of the contract at the then current contract value, which may
be less than the death benefit. If joint owners die simultaneously, the death
benefit will become payable.
Death Benefit Amount During The Accumulation Phase
Before the date you or the oldest joint owner reaches age 75, the death benefit
during the accumulation phase will be the greater of:
(1) your purchase payments, less any withdrawals and any applicable charges;
or
(2) your contract value as of the business day we receive proof of death and
election of the payment method; or
(3) your contract value on the most recent 3 year contract anniversary, plus
any subsequent purchase payments, less any subsequent withdrawals,
including any applicable charges. Your first contract anniversary is one
calendar year from the date we issued your contract.
After you or the oldest joint owner reaches age 75, the death benefit during the
accumulation period will be the greater of:
(1) the purchase payments, less any withdrawals and any applicable charges; or
(2) your contract value as of the business day we receive proof of death and
election of the payment method; or
(3) your contract value on the most recent 3 year contract anniversary prior
to the owner or the oldest joint owner reaching age 75, plus any
subsequent purchase payments, less any subsequent withdrawals, including
any applicable charges. Your first contract anniversary is one calendar
year from the date we issued your contract.
If the contract is owned by a non-natural person, owner means annuitant for
purposes of determining the death benefit amount.
Death Benefit Options During The Accumulation Phase
A beneficiary who is not your surviving spouse must elect to receive the death
benefit under one of the following options, in the event you die during the
accumulation phase.
Option 1 - lump sum payment of the death benefit; or
Option 2 - the payment of the entire death benefit within 5 years of the date of
death; or
Option 3 - payment of the death benefit under an annuity option over the
lifetime of the beneficiary or over a period not extending beyond the life
expectancy of the beneficiary with distribution beginning within 1 year of the
date of your death or any joint owner.
Death Benefit 25
<PAGE>
If a lump sum payment is requested, we will pay the amount within 7 days after
we receive due proof of death and other necessary information at our Annuity
Service Center unless we are required to suspend or delay payment. Payment to
the beneficiary, in any form other than a lump sum, may only be elected during
the 60-day period beginning with the date of receipt by us of proof of death.
Death Of Contract Owner During The Income Phase
If you or the joint owner dies during the income phase, but the annuitant is
still alive, we will pay the remaining payments under the annuity option elected
at least as rapidly as under the method of distribution in effect at the time of
your death.
Death Of Annuitant
If the annuitant, who is not the owner or joint owner, dies during the
accumulation phase, you can name a new annuitant subject to the underwriting
rules we have in effect at the time. If you do not name an annuitant within 30
days of the death of the annuitant, you will become the annuitant. However, if
the owner is a non-natural person we will treat the death of the annuitant as
the death of the owner, and you may not name a new annuitant.
Upon the death of the annuitant on or after the annuity date, the death benefit,
if any, is as specified in the annuity option elected. We will pay death
benefits at least as rapidly as under the method of distribution in effect at
the annuitant's death.
26 Death Benefit
<PAGE>
Taxes
NOTE: We have prepared the following information on taxes as a general
discussion of the subject. It is not intended as tax advice to any individual.
You should consult your own tax adviser about your own circumstances. We have
included in the Statement of Additional Information an additional discussion
regarding taxes.
Annuity Contracts In General
Annuity contracts are a means of setting aside money for future needs - usually
retirement. Congress recognized how important saving for retirement was and
provided special rules in the Internal Revenue Code (Code) for annuities.
Simply stated, these rules provide that you will not be taxed on the earnings on
the money held in your annuity contract until you take the money out. This is
referred to as tax deferral. There are different rules as to how you are taxed
depending on how you take the money out and the type of contract - qualified or
non-qualified (see following sections).
You, as the owner of a non-qualified annuity, will generally not be taxed on
increases in the value of your contract until a distribution occurs - either as
a withdrawal or as annuity payments. When you make a withdrawal, you are taxed
on the amount of the withdrawal that is earnings. For annuity payments,
different rules apply. A portion of each annuity payment is treated as a partial
return of your purchase payments and is not taxed. The remaining portion of the
annuity payment is treated as ordinary income. How the annuity payment is
divided between taxable and non-taxable portions depends upon the period over
which the annuity payments are expected to be made. Annuity payments received
after you have recovered all of your purchase payments are fully includible in
income.
When a non-qualified contract is owned by a non-natural person (e.g.,
corporation or certain other entities other than a trust holding the contract as
an agent for a natural person), the contract will generally not be treated as an
annuity for tax purposes.
Qualified And Non-Qualified Contracts
If you purchase the contract as an individual and not under any pension plan,
specially sponsored program or an individual retirement annuity, your contract
is referred to as a non-qualified contract.
If you purchase the contract under a pension plan, specially sponsored program,
or an individual retirement annuity, your contract is referred to as a qualified
contract. Examples of qualified plans are: deductible and non-deductible
Individual Retirement Annuities (IRAs), and pension and profit-sharing plans,
which include 401(k) plans and H.R. 10 Plans.
Withdrawals - Non-Qualified Contracts
If you take a withdrawal from your contract, the Code treats that withdrawal as
first coming from earnings and then from your purchase payments. The withdrawn
earnings are includible in income.
The Code also provides that any amount received under an annuity contract which
is included in income may be subject to a penalty. The amount of the penalty is
equal to 10% of the amount that is includible in income. Some withdrawals will
be exempt from the penalty. They include any amounts:
(1) paid on or after you reach age 59 1/2;
(2) paid to your beneficiary after you die;
(3) paid if you become totally disabled (as that term is defined in the Code);
(4) paid in a series of substantially equal payments made annually (or more
frequently) for life or a period not exceeding life expectancy;
(5) paid under an immediate annuity; or
(6) which come from purchase payments made before August 14, 1982.
Taxes 27
<PAGE>
Withdrawals - Qualified Contracts
If you have no cost basis for your interest in a qualified contract, the full
amount of any distribution is taxable to you as ordinary income. If you do have
a cost basis for your interest, a portion of the distribution is taxable,
generally based on the ratio of your cost basis to your total contract value.
Special tax rules may be available for certain distributions from a qualified
contract.
Section 72(t) of the Code imposes a 10% penalty tax on the taxable portion of
any distribution from qualified retirement plans, including contracts issued and
qualified under Code Sections 401 (Pension and Profit-Sharing Plans), 408
(Individual Retirement Annuities - IRAs), and 408A (Roth IRAs). Exceptions from
the penalty tax are as follows:
o distributions made on or after you reach age 59 1/2;
o distributions made after your death or disability (as defined in Code
Section 72(m)(7);
o after separation from service, distributions that are part of
substantially equal periodic payments made not less frequently than
annually for your life (or life expectancy) or the joint lives (or joint
life expectancies) of you and your designated beneficiary (in applying
this exception to distributions from IRAs, a separation from service is
not required);
o distributions made after separation of service if you have reached age 55
(not applicable to distributions from IRAs);
o distributions made to you up to the amount allowable as a deduction to you
under Code Section 213 for amounts you paid during the taxable year for
medical care;
o distributions made to an alternate payee pursuant to a qualified domestic
relations order (not applicable to distributions from IRAs);
o distributions from an IRA for the purchase of medical insurance (as
described in Code Section 213(d)(1)(D)) for you and your spouse and
dependents if you received unemployment compensation for at least 12 weeks
and have not been re-employed for at least 60 days);
o distributions from an IRA to the extent they do not exceed your qualified
higher education expenses (as defined in Code Section 72(t)(7) for the
taxable year; and
o distributions from an IRA which are qualified first-time home buyer
distributions (as defined in Code Section 72(t)(8)).
Generally, distributions from a qualified plan must begin no later than April
1st of the calendar year following the later of (a) the year in which you attain
age 70 1/2 or (b) the calendar year in which you retire. The date set forth in
(b) does not apply to an IRA. Required distributions do not apply to a Roth IRA
during your lifetime. Required distributions must be over a period not exceeding
your life expectancy or the joint lives or joint life expectancies of you and
your designated beneficiary. If required minimum distributions are not made, a
50% penalty tax is imposed on the amount that should have been distributed.
28 Taxes
<PAGE>
Other Information
Terminal Illness Benefit
In most states, you may elect a Terminal Illness Benefit. We will require proof
that you are terminally ill and not expected to live more than 12 months. This
proof will include certification by a licensed medical practitioner performing
within the scope of his/her license. You may not be the licensed medical
practitioner, nor can the medical practitioner be your parent, spouse or child.
We may also impose additional requirements.
We will determine the amount of payment when we receive your written request.
Prior to the date you or the joint owner reaches age 75, the Terminal Illness
Benefit is the greater of:
(1) your purchase payments, less any withdrawals and any applicable charges;
or
(2) your contract value; or
(3) your contract value on the most recent 3 year contract anniversary plus
any subsequent purchase payments less any subsequent withdrawals and any
applicable charges.
After you or the oldest joint owner reaches age 75, the Terminal Illness Benefit
will be the greater of:
(1) the purchase payments, less any withdrawals and any applicable
(2) charges; or
(3) your contract value; or
(4) your contract value on the most recent 3 year contract anniversary prior
to you, or the oldest joint owner reaching age 75, plus any subsequent
purchase payments less any subsequent withdrawals and any applicable
charges.
We will not apply a contingent deferred sales charge with respect to any
Terminal Illness Benefit. Payment of the Terminal Illness Benefit will terminate
the contract.
If joint owners are named, we will use the age of the oldest to determine the
Terminal Illness Benefit. If the contract is owned by a non-natural person, the
Terminal Illness Benefit applies to the annuitant.
Performance
We may advertise certain performance-related information. This information
reflects historical performance and is not intended to indicate or predict the
future performance.
Standardized Total Returns
We will show standardized average annual total returns for sub-accounts that
have been in existence for more than one year. These returns assume you made a
single $1,000 payment at the beginning of the period and withdrew the entire
amount at the end of the period. The return reflects a deduction for the
contingent deferred sales charge, the annual contact maintenance charge and all
other separate account and contract level charges, except premium taxes, if any.
If a sub-account has been in existence for less than one year, we will show the
aggregate total return. This assumes you made a single $1,000 payment at the
beginning of the period and withdrew the entire amount at the end of the period.
The return reflects the change in unit value and a deduction of the contingent
deferred sales charge.
Nonstandard Total Returns
We will also show total returns based on historical performance of the
sub-accounts and underlying funds. We may assume the contracts were in existence
prior to their inception date, January 23, 1996, which they were not. Total
return percentages include all fund level and separate account level charges.
They do not include a contingent deferred sales charge, contract maintenance
charge, or premium taxes, if any. If these charges were included, returns would
be less than those shown.
Other Information 29
<PAGE>
Total Returns compare the value of an accumulation unit at the beginning of a
period with the value of an accumulation unit at the end of the period.
Average Annual Total Returns measure this performance over a period of time
greater than one year. Average annual total returns compare values over a given
period of time and express the percentage as an average annual rate.
Yield and Effective Yield
We may also show yield and effective yield for the Oppenheimer Money Fund/VA
over a seven-day period, which we then "annualize". This means that when we
calculate yield, we assume that the amount of money the investment earns for the
week is earned each week over a 52-week period. We show this as a percentage of
the investment. We calculate the "effective yield" similarly, but when we
annualize the amount, we assume the income earned is reinvested. Therefore, the
effective yield is slightly higher that the yield because of the compounding
effect.
Related Performance
Some of the funds available to you are similar to mutual funds offered in the
retail marketplace. These funds generally have the same investment objectives,
policies and portfolio managers as the retail mutual funds and usually were
formed after the retail mutual funds. While these funds generally have identical
investment objectives, policies and portfolio managers, they are separate and
distinct from retail mutual funds. In fact, performance of these funds may be
dramatically different from the performance of the retail mutual funds. This is
due to differences in the funds' sizes, dates shares of stocks are purchased and
sold, cash flows and expenses. You should remember that retail mutual fund
performance is not the performance of the funds available in this contract and
is not an indication of future performance of these funds.
Year 2000
Like other businesses and governments around the world, we could be adversely
affected if the computer systems used by us and those with which we do business
do not properly recognize the year 2000. This is commonly known as the "Year
2000 issue".
In 1996, our parent company, MassMutual, began an enterprise-wide process of
identifying, evaluating and implementing changes to computer systems and
applications software to address the Year 2000 issue on its own behalf and on
behalf of certain subsidiaries, including us. MassMutual is addressing the Year
2000 issue internally with modifications to existing programs and conversions to
new programs. MassMutual is also seeking assurances from vendors, customers,
service providers, governments and others with which we and MassMutual conduct
business, to determine their year 2000 readiness.
MassMutual has allocated a portion of the costs related to the year 2000 issue
to us. The costs are currently being expensed, and when measured against net
gain from operations, are not material us.
Distributors
MML Distributors, LLC (MML Distributors) serves as principal underwriter for the
contracts. MML Investors Services, Inc. (MMLISI) serves as co-underwriter for
the contracts. Their purpose as underwriters is to distribute the contracts. MML
Distributors and MMLISI are wholly owned subsidiaries of MassMutual. Both are
located at 1414 Main Street, Springfield, Massachusetts 01144-1013.
We will pay commissions to broker-dealers who sell the contracts. Currently, we
pay an amount up to 7% of purchase payments. As an alternative, we may pay a
commission of 1.2% of contract values each contract year. We also may pay a
commission that is a combination of purchase payments and contract value. These
alternatives could exceed 7%.
From time to time, MML Distributors may enter into special arrangements with
certain broker-dealers. These special arrangements may provide for the payment
of higher compensation to such broker-dealers for selling the contracts.
30 Other Information
<PAGE>
Electronic Transmission Of Application Information
Upon agreement with a limited number of broker-dealers, we will accept
electronic data transmissions of application information. Our Annuity Service
Center will accept this information at the time the initial purchase payment is
transmitted by wire. Please contact your representative for more information.
Assignment
You can assign the contract at any time during your lifetime. We will not be
bound by the assignment until we receive written notice of the assignment. We
will not be liable for any payment or other action we take in accordance with
the contract before we receive notice of the assignment. You may be subject to
tax consequences if you assign your contract.
If the contract is issued pursuant to a qualified plan, there may be limitations
on your ability to assign the contract. If you assign your contract, your rights
may only be exercised with the consent of the assignee of record. We require
consent of any irrevocable beneficiary before we assign proceeds.
Voting Rights
We are the legal owner of the fund shares. However, when a fund solicits proxies
in conjunction with a vote of shareholders, it is required to obtain from you
and other owners, instructions as to how to vote those shares. When we receive
those instructions, we will vote all of the shares, for which we have not
received voting instructions, in proportion to those instructions. This will
also include any shares that we own on our own behalf. If we determine that we
are no longer required to comply with the above, we will vote the shares in our
own right.
During the accumulation phase of your contract and while the annuitant is
living, we determine the number of shares you may vote by dividing your contract
value in each fund, if any, by $100. Fractional shares are counted. During the
income phase or after the annuitant dies, we determine the number of shares you
may vote based on our liability for future variable monthly annuity payments.
Reservation of Rights
We reserve the right to:
o substitute another fund for one of the funds you selected and
o add or eliminate sub-accounts.
If we exercise any of these rights, we will receive prior approval from the
Securities and Exchange Commissions, if necessary. We will also give you notice
of our intent to exercise any of these rights.
Suspension Of Payments Or Transfers
We may be required to suspend or postpone payments for withdrawals or transfers
from the funds for any period when:
o the New York Stock Exchange is closed (other than customary weekend and
holiday closings); or
o trading on the New York Stock Exchange is restricted;
o an emergency exists as a result of which disposal of shares of the funds
is not reasonably practicable or we cannot reasonably value the shares of
the funds;
o during any other period when the Securities and Exchange Commission, by
order, so permits for your protection.
We reserve the right to defer payment for a withdrawal from The Fixed Account
for the period permitted by law but not for more than six months.
Legal Proceedings
We are currently not involved in any legal proceedings that might adversely
impact the contracts.
Other Information 31
<PAGE>
Financial Statements
We have included our financial statements and those of the Separate Account in
the Statement of Additional Information.
Additional Information
For further information about the contract, you may obtain a Statement of
Additional Information. You can call the telephone number indicated on the cover
page or you can write to us. For your convenience we have included a form for
that purpose.
The Table of Contents of this statement is as follows:
1. Company
2. Custodian
3. Assignment of Contract
4. Distribution
5. Purchase of Securities Being Offered
6. Accumulation Units and Unit Value
7. Transfers During the Income Phase
8. Payment of Death Benefit
9. Annuity Payments
10. Federal Tax Matters
11. Performance Measures
12. Experts
13. Financial Statements
32 Other Information
<PAGE>
To: C.M. Life Insurance Company
Annuity Products, H565
P.O. Box 9067
Springfield, Massachusetts
01102-9067
Please send me a Statement of Additional Information for C.M. Life's Panorama
Premier.
Name ___________________________________________________
Address ___________________________________________________
___________________________________________________
City ___________________ State _________ Zip ___________
Telephone ___________________________________________________
33
<PAGE>
Appendix A
Condensed Financial Information
The following schedules include accumulation unit values for the periods
indicated. We have extracted this data from the separate account's audited
financial statements. You should read this information in conjunction with the
separate account's audited financial statements and related notes that are
included in the Statement of Additional Information.
Accumulation Unit Values
<TABLE>
<CAPTION>
Value at
Inception
Sub-Account Dec. 31, 1998 Dec. 31, 1997 Dec. 31, 1996 Date
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------
Money 11.150105 10.741883 10.342534 10.00(a)
- ---------------------------------------------------------------------------------------------
Bond 11.725305 11.133260 10.333908 10.00(a)
- ---------------------------------------------------------------------------------------------
LifeSpan Diversified Income 12.046624 11.648276 10.498529 10.00(a)
- ---------------------------------------------------------------------------------------------
Total Return 13.876594 12.689528 10.831420 10.00(a)
- ---------------------------------------------------------------------------------------------
LifeSpan Balanced 12.983356 12.401154 11.208195 10.00(a)
- ---------------------------------------------------------------------------------------------
LifeSpan Capital Appreciation 13.619392 12.970161 11.688219 10.00(a)
- ---------------------------------------------------------------------------------------------
Growth 15.669692 14.655753 11.761149 10.00(a)
- ---------------------------------------------------------------------------------------------
International Equity 13.961844 11.858034 11.123558 10.00(a)
- ---------------------------------------------------------------------------------------------
Contrafund 12.598281 NA NA 10.00(b)
- ---------------------------------------------------------------------------------------------
Income & Growth 12.423410 NA NA 10.00(b)
- ---------------------------------------------------------------------------------------------
Mid-Cap Growth 13.076410 NA NA 10.00(b)
- ---------------------------------------------------------------------------------------------
Small Cap Value Equity 11.164329 NA NA 10.00(b)
</TABLE>
Appendix A A-1
<PAGE>
Accumulation Units Outstanding
<TABLE>
<CAPTION>
Sub-Account Dec. 31, 1998 Dec. 31, 1997 Dec. 31, 1996
- -------------------------------------------------------------------------------------
<S> <C> <C> <C>
Money(a) 2,167,370 1,270,662 526,970
- -------------------------------------------------------------------------------------
Bond(a) 1,610,177 577,928 245,238
- -------------------------------------------------------------------------------------
LifeSpan Diversified Income(a) 1,386,641 750,520 250,228
- -------------------------------------------------------------------------------------
Total Return(a) 7,175,242 3,710,237 1,416,956
- -------------------------------------------------------------------------------------
LifeSpan Balanced(a) 2,863,916 1,882,142 990,137
- -------------------------------------------------------------------------------------
LifeSpan Capital Appreciation(a) 2,583,238 1,988,330 910,038
- -------------------------------------------------------------------------------------
Growth(a) 7,066,702 3,900,882 1,258,381
- -------------------------------------------------------------------------------------
International Equity(a) 1,866,209 1,128,689 320,578
- -------------------------------------------------------------------------------------
Contrafund (b) 539,768 NA NA
- -------------------------------------------------------------------------------------
Income & Growth (b) 695,584 NA NA
- -------------------------------------------------------------------------------------
Mid-Cap Growth (b) 279,360 NA NA
- -------------------------------------------------------------------------------------
Small Cap Value Equity (b) 167,833 NA NA
</TABLE>
(a) Commencement of public offering was January 23, 1996.
(b) Commencement of public offering was September 1, 1998.
A-2
<PAGE>
PART B
INFORMATION REQUIRED IN A STATEMENT OF
ADDITIONAL INFORMATION
1
<PAGE>
PANORAMA PREMIER
C.M. LIFE INSURANCE COMPANY
(Depositor)
C.M. MULTI-ACCOUNT A
(Registrant)
STATEMENT OF ADDITIONAL INFORMATION
May 1, 1999
This is not a prospectus. This Statement of Additional Information should be
read in conjunction with the prospectus dated May 1, 1999, for the individual
variable deferred annuity contracts with flexible purchase payments which are
referred to herein.
For a copy of the prospectus call write to: C.M. Life Insurance Company,
Panorama 1-800-366-8226 or Premier, Annuity Service Center, H565, P.O. Box 9067,
Springfield, MA 01102-9067.
TABLE OF CONTENTS
Company ................................................................... 2
Custodian ................................................................. 2
Assignment of Contract .................................................... 2
Distribution .............................................................. 3
Purchase of Securities Being Offered ...................................... 3
Accumulation Units and Unit Value ......................................... 3
Transfers During The Income Phase ......................................... 4
Payment of Death Benefit .................................................. 4
Annuity Payments .......................................................... 5
Performance Measures ...................................................... 5
Federal Tax Matters ....................................................... 11
Experts ................................................................... 17
Financial Statements ................................................final pages
1
<PAGE>
COMPANY
C.M. Life Insurance Company (the "Company"), 140 Garden Street, Hartford,
Connecticut 06154, is a stock life insurance company. It was chartered by a
special Act of the Connecticut General Assembly on April 25, 1980. It is
principally engaged in the sale of life insurance and annuities, and is licensed
in all states except New York. The Company is a wholly-owned subsidiary of
Massachusetts Mutual Life Insurance Company ("MassMutual").
MassMutual is a mutual life insurance company specially chartered by the
Commonwealth of Massachusetts on May 14, 1851. It is currently licensed to
transact life, accident, and health insurance business in all states, the
District of Columbia, Puerto Rico and certain provinces of Canada. MassMutual
had consolidated statutory assets in excess of $67 billion, and estimated total
assets under management of $176.8 billion as of December 31, 1998.
CUSTODIAN
The shares of the underlying funds purchased by the sub-accounts are held by the
Company as custodian of C.M. Multi-Account A ("the separate account").
ASSIGNMENT OF CONTRACT
The Company will not be charged with notice of any assignment of a contract or
of the interest of any beneficiary or of any other person unless the assignment
is in writing and the Company receives the original or a true copy thereof at
its Home Office. The Company assumes no responsibility for the validity of any
assignment.
While the contracts are generally assignable, all non-tax qualified contracts
must carry a non-transferability endorsement which precludes their assignment.
For qualified contracts, the following exceptions and provisions should be
noted:
(1) No person entitled to receive annuity payments under a contract or
part or all of the contract's value will be permitted to commute, anticipate,
encumber, alienate or assign such amounts, except upon the written authority of
the contract owner given during the annuitant's lifetime and received in good
order by the Company at its annuity service center. To the extent permitted by
law, no contract nor any proceeds or interest payable thereunder will be subject
to the annuitant's or any other person's debts, contracts or engagements, nor to
any levy or attachment for payment thereof;
(2) If an assignment of a contract is in effect on the maturity date, the
Company reserves the right to pay to the assignee in one sum the amount of the
contract's maturity value to which he is entitled, and to pay any balance of
such value in one sum to the contract owner, regardless of any payment options
which the contract owner may have elected. Moreover, if an assignment of a
contract is in effect at the death of the annuitant prior to the maturity date,
the Company will pay to the assignee in one sum, to the extent that he is
entitled, the greater of (a) the total of all purchase payments, less the net
amount of all partial redemptions, and (b) the accumulated value of the
contract, and any balance of such value will be paid to the beneficiary in one
sum or applied under one or more of the payment options elected;
(3) Contracts used in connection with a tax-qualified retirement plan must
be endorsed to provide that they may not be sold, assigned or pledged for any
purpose unless they are owned by the trustee of a trust described in Section
401(a) or by the administrator of an annuity plan described under Section 403(a)
of the Code; and
(4) Contracts issued under a plan for an Individual Retirement Annuity
pursuant to Section 408 of the Code must be endorsed to provide that they are
non-transferable. Such contracts may not be sold, assigned, discounted, or
pledged as collateral for a loan or as security for the performance of an
obligation or for any other purpose by the Annuitant to any person or party
other than the Company, except to a former spouse of the annuitant in accordance
with the terms of a divorce decree or other written instrument incident to a
divorce.
Assignments may be subject to federal income tax.
2
<PAGE>
DISTRIBUTION
MML Distributors, LLC ("MML Distributors"), is the principal underwriter of the
contracts. MML Investors Services, Inc. ("MMLISI") serves as co-underwriter of
the contracts. Both MML Distributors and MMLISI are broker-dealers registered
with the Securities and Exchange Commission and members of the National
Association of Securities Dealers, Inc. MML Distributors and MMLISI are indirect
wholly-owned subsidiaries of MassMutual and affiliates of the Company.
Pursuant to the Underwriting and Servicing Agreement, both MML Distributors and
MMLISI will receive compensation for their activities as underwriters for the
Separate Account. Compensation paid to MMLISI was $98,000 in 1998 and $98,000 in
1997. No compensation was paid to MML Distributors in 1998 or 1997. Commissions
will be paid through MMLISI and MML Distributors to agents and selling brokers
for selling the Contracts. During 1998, 1997 and 1996, commission payments
amounted to $5,096,421, $3,070,825 and $1,780,825 respectively.
MML Distributors may enter into selling agreements with other broker-dealers
which are registered with the Securities and Exchange Commission and are members
of the National Association of Securities Dealers, Inc. ("selling brokers").
Contracts are sold through agents who are licensed by state insurance officials
to sell the Contracts. These agents are also registered representatives of
selling brokers or of MMLISI.
MML Distributors does business under different variations of its name; including
the name MML Distributors, L.L.C. in the states of Illinois, Michigan, Oklahoma,
South Dakota, and Washington, and the name MML Distributors, Limited Liability
Company in the states of Maine, Ohio, and West Virginia.
The offering is on a continuous basis.
PURCHASE OF SECURITIES BEING OFFERED
The Company sells interests in the separate account to contract owners as
accumulation units. Charges associated with such securities are discussed in the
Expenses section of the prospectus. Any special purchase plan or exchange
program offered by this contract is mentioned in prospectus. See the Contingent
Deferred Sales Charge section of the prospectus for a discussion of instances
when the Company will waive contingent deferred sales charges.
ACCUMULATION UNITS AND UNIT VALUE
During the accumulation phase, accumulation units shall be used to account for
all amounts allocated to or withdrawn from the sub-accounts of the separate
account as a result of purchase payments, withdrawals, transfers, or fees and
charges. The Company will determine the number of accumulation units of a
sub-account purchased or canceled. This will be done by dividing the amount
allocated to (or the amount withdrawn from) the sub-account by the dollar value
of one accumulation unit of the sub-account as of the end of the business day
during which the transaction is received at the annuity service center.
The accumulation unit value for each sub-account was arbitrarily set initially
at $10. Subsequent accumulation unit values for each sub-account are determined
for each day in which the New York Stock Exchange is open for business
("business day") by multiplying the accumulation unit value for the immediately
preceding business day by the net investment factor for the sub-account for the
current business day.
The net investment factor for each sub-account is determined by dividing A by B
and subtracting C where:
A is (i) the net asset value per share of the funding vehicle or portfolio of a
funding vehicle held by the sub-account for the current business day; plus (ii)
any dividend per share declared on behalf of such funding vehicle or portfolio
of a funding vehicle that has an ex-dividend date within the current business
day; less (iii) the cumulative charge or credit for taxes reserved which is
determined by the Company to have resulted from the operation or maintenance of
the sub-account.
3
<PAGE>
B is the net asset value per share of the funding vehicle or portfolio held by
the sub-account for the immediately preceding business day.
C is the cumulative charge for the mortality and expense risk charge and for the
administrative charge.
The accumulation unit value may increase or decrease from business day to
business day.
TRANSFERS DURING THE INCOME PHASE
Transfers of annuity reserves between sub-accounts will be made by converting
the number of annuity units attributable to the annuity reserves 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 with out the transfer.
Thereafter, annuity payments will reflect changes in the value of the new
annuity units.
The amount transferred to the general account from a sub-account will be based
on the annuity reserves for the contract owner in that sub-account. Transfers to
the general account will be made by converting the annuity units being
transferred to purchase fixed annuity payments under the annuity option in
effect and based on the age of the annuitant at the time of the transfer.
See the Transfers During the Income Phase section in the prospectus for more
information about transfers during the income phase.
PAYMENT OF DEATH BENEFIT
The Company will require due proof of death before any death benefit is paid.
Due proof of death will be:
1. a certified death certificate;
2. a certified decree of a court of competent jurisdiction as to the finding
of death; or
3. any other proof satisfactory to the Company.
All death benefits will be paid in accordance with applicable law or regulations
governing death benefit payments.
The beneficiary designation in effect on the date we issue the contract will
remain in effect until changed. Unless the contract owner provides otherwise,
the death benefit will be paid in equal shares to the beneficiary(ies) as
follows:
1. to the primary beneficiary(ies) who survive the contract owner's and/or
the annuitant's death, as applicable; or if there are none
2. to the contingent beneficiary(ies) who survive the contract owner's and/or
the annuitant's death, as applicable; or if there are none
3. to the estate of the contract owner.
You may name an irrevocable beneficiary(ies). In that case, a change of
beneficiary requires the consent of any irrevocable beneficiary. If an
irrevocable beneficiary is named, the contract owner retains all other
contractual rights.
See the Death Benefit section in the prospectus for more information on death
benefits.
4
<PAGE>
ANNUITY PAYMENTS
A variable annuity payment is an annuity with payments which; (1) are not
predetermined as to dollar amount; and (2) will vary in amount with the net
investment results of the applicable sub-accounts of the separate account.
Annuity payments also depend upon the age of the annuitant and any joint
annuitant and the assumed interest factor utilized. The annuity table used will
depend upon the annuity option chosen. The dollar amount of annuity payments
after the first is determined as follows;
1. The dollar amount of the first annuity payment is divided by the
value of an annuity unit as of the annuity date. This establishes
the number of annuity units for each annuity payment. The number of
annuity units remains fixed during the annuity period.
2. For each sub-account, the fixed number of annuity units is
multiplied by the annuity unit value on each subsequent annuity
payment date.
3. The total dollar amount of each variable annuity payment is the sum
of all sub-account variable annuity payments.
The number of annuity units is determined as follows:
1. The number of annuity units credited in each sub-account will be
determined by dividing the product of the portion of the contract value to
be applied to the sub-account and the annuity purchase rate by the value
of one annuity unit in that sub-account on the annuity date. The purchase
rates are set forth in the variable annuity rate tables in the contract.
2. For each sub-account, the amount of each annuity payment equals the
product of the annuitant's number of annuity units and the annuity unit
value on the payment date. The amount of each payment may vary.
The value of any annuity unit for each sub-account of the separate account was
arbitrarily set initially at $10. The sub-account annuity unit value at the end
of any subsequent valuation period is determined as
follows:
1. The net investment factor for the current business day is multiplied by
the value of the annuity unit for the sub-account for the immediately
preceding business day.
2. The result in (1) is then divided by an assumed investment rate factor.
The assumed investment rate factor equals 1.00 plus the assumed investment
rate for the number of days since the preceding business day. The assumed
investment rate is based on an effective annual rate of 4%.
The value of an annuity unit may increase or decrease from business day to
business day. See the Income Phase section in the prospectus for more
information.
PERFORMANCE MEASURES
The Company may advertise certain performance-related information. This
information reflects historical performance and is not intended to indicate or
predict future performance.
Standardized Average Annual Total Return
The Company will show standardized average annual total returns for each
sub-account that has been in existence for more than one year. These returns
assume you made a single $1,000 payment at the beginning of the period and
withdrew the entire amount at the end of the period. The return reflects a
deduction for the contingent deferred sales charge, the annual contract
maintenance charge and all other fund, separate account and contract level
charges, except premium taxes, if any.
5
<PAGE>
If a sub-account has been in existence for less than one year, the Company will
show the aggregate total return. This assumes you made a single $1,000 payment
at the beginning of the period and withdrew the entire amount at the end of the
period. The return reflects the change in unit value and a deduction of the
contingent deferred sales charge.
The following tables show the standardized average annual total return for the
sub-accounts for the period ended December 31, 1998.
1 Year Since Inception
------ ---------------
Money Sub-Account -3.32% 1.56%
Bond Sub-Account -1.48 3.88
LifeSpan Diversified Income Sub-Account -3.21 4.92
Total Return Sub-Account 1.93 9.94
LifeSpan Balanced Sub-Account -2.13 7.65
LifeSpan Capital Appreciation Sub-Account -1.89 9.44
Income & Growth Sub-Account -- 17.15*
Growth Sub-Account -0.44 14.70
Contrafund Sub-Account -- 18.90*
Small Cap Value Equity Sub-Account -- 4.60*
Mid-Cap Growth Sub-Account -- 23.71*
International Equity Sub-Account 10.44 10.36
* This return is an aggregate total return for the It reflects the change in
unit period 9/1/98 to 12/31/98. value and a deduction for the contingent
deferred sales charge.
Non-Standard Total Returns
The Company will also show total returns based on historical performance of the
sub-accounts and underlying funds. The Company may assume the contracts were in
existence prior to January 23, 1996, which they were not. Total return
percentages include all fund level and separate account level charges. They do
not include a contingent deferred sales charge, contract maintenance charge, or
premium taxes, if any. If these charges were included, returns would be less
than those shown.
Total Returns compare the value of an accumulation unit at the beginning of a
period with the value of an accumulation unit at the end of the period.
Average Annual Total Returns measure this performance over a period of time
greater than one year. Average annual total returns compare values over a given
period of time and express the percentage as an average annual rate.
The performance figures discussed below, are calculated on the basis of the
historical performance of the funds, and may assume the contracts were in
existence prior to January 23, 1996 (which they were not). Beginning January 23,
1996 (inception date), actual accumulation unit values are used for the
calculations. Beginning September 1, 1998, actual accumulation unit values are
used to determine the returns for the Income & Growth Sub-Account, the
Contrafund Sub-Account, the Small Cap Value Equity Sub-Account and the Mid-Cap
Growth Sub-Account.
6
<PAGE>
Average Annual Total Returns
For Periods Ending 12/31/98
<TABLE>
<CAPTION>
Since
Portfolio (Inception) 1 Year 3 Years 5 Years 10 Years Inception
- --------------------- ------ ------- ------- -------- ---------
<S> <C> <C> <C> <C> <C>
Oppenheimer Money (4/3/85)* ................... 3.80% 3.84% 3.65% 4.14% 4.41%
Oppenheimer Bond (4/3/85) ..................... 5.32% 5.44% 5.52% 7.69% 8.01%
Panorama LifeSpan Diversified Income (9/1/95).. 3.42% 6.49% NA NA 7.50%
Panorama Total Return (9/30/82) ............... 9.35% 11.55% 10.62% 12.14% 12.08%
Panorama LifeSpan Balanced (9/1/95) ........... 4.69% 8.96% NA NA 9.84%
Panorama LifeSpan Cap. Appreciation (9/1/95)... 5.01% 10.52% NA NA 11.53%
American Century VP Income & Growth (10/30/97). 25.10% NA NA NA 28.87%
Panorama Growth (1/21/82) ..................... 6.92% 16.09% 15.85% 16.38% 16.09%
Fidelity's VIP Fund II Contrafund (1/3/95) .... 28.17% 23.32% NA NA 26.83%
MML Small Cap Value Equity (6/1/98) ........... NA NA NA NA -13.66%
T. Rowe Price Mid-Cap Growth (12/31/96) ....... 20.38% NA NA NA 18.76%
Panorama International Equity (5/1/92) ........ 17.74% 11.89% 8.77% NA 8.67%
</TABLE>
* Although the Oppenheimer Money Fund/VA commenced operations on 4/3/85, the
information necessary to calculate returns is available only for 1987 and later
years.
Performance information for the sub-accounts may be: (a) compared to other
variable annuity separate accounts or other investment products surveyed by
Lipper Analytical Services, a nationally recognized independent reporting
service or similar service that rank mutual funds and other investment companies
by overall performance, investment objectives and assets; (b) compared to
indices; (c) tracked by other ratings services, companies, publications or
persons who rank separate accounts or other investment products on overall
performance or other criteria; and (d) included in data bases that can be used
to produce reports and illustrations by organizations such as CDA Wiesenberger.
Performance figures will be calculated in accordance with standardized methods
established by each reporting service.
The Company may also show yield and effective yield for the Money Sub-Account
over a seven-day period, which we then "annualize". This means that when the
Company calculates yield, it assumes that the amount of money the investment
earns for the week is earned each week over a 52-week period. The Company shows
this as a percentage of the investment. The Company calculates the "effective
yield" similarly but when it annualizes the amount, the Company assumes the
income earned is re-invested. Therefore, the effective yield is slightly higher
than the yield because of the compounding effect.
These figures reflect a deduction for all fund, separate account and contract
level charges assuming the contract remains inforce. The figures do not reflect
the contingent deferred sales charge or premium tax deductions (if any), which
if included would reduce the percentages reported.
The 7-Day Yield and Effective Yield for the Money Sub-Account for the period
ended December 31, 1998 are as follows:
After Deduction of
Before Deduction of Annual Maintenance Charge
Annual Maintenance Charge (Annual Maintenance Charge is 0.086%)
7-Day Yield ..................... 1.35% 7-Yield ..................... 1.26%
7-Day Effective Yield ........... 1.36% 7-Day Effective Yield ....... 1.27%
7
<PAGE>
PANORAMA PREMIER HYPOTHETICAL PROJECTIONS
PANORAMA GROWTH
---------------
$10,000 purchase payment made December 31, 1988
Non-Standardized
----------------
Accumulated Calendar Year
Date Payment Value Total Return
- ------------------------------------------------------------------------
12/31/88 $10,000 $10,000
12/31/89 $13,362 33.62%
12/31/90 $12,105 -9.41%
12/31/91 $16,387 35.37%
12/31/92 $18,108 10.51%
12/31/93 $21,632 19.46%
12/31/94 $21,235 -1.83%
12/31/95 $28,780 35.53%
12/31/96 $33,765 17.32%
12/31/97 $42,045 24.52%
12/31/98 $44,923 6.85%
PANORAMA TOTAL RETURN
---------------------
$10,000 purchase payment made December 31, 1988
Non-Standardized
----------------
Accumulated Calendar Year
Date Payment Value Total Return
- ------------------------------------------------------------------------
12/31/88 $10,000 $10,000
12/31/89 $12,098 20.98%
12/31/90 $11,959 -1.15%
12/31/91 $15,158 26.75%
12/31/92 $16,414 8.29%
12/31/93 $18,791 14.48%
12/31/94 $18,232 -2.97%
12/31/95 $22,362 22.65%
12/31/96 $24,198 8.21%
12/31/97 $28,319 17.03%
12/31/98 $30,939 9.25%
OPPENHEIMER BOND
----------------
$10,000 purchase payment made December 31, 1988
Non-Standardized
----------------
Accumulated Calendar Year
Date Payment Value Total Return
- ------------------------------------------------------------------------
12/31/88 $10,000 $10,000
12/31/89 $11,122 11.22%
12/31/90 $11,780 5.92%
12/31/91 $13,612 15.55%
12/31/92 $14,252 4.70%
12/31/93 $15,857 11.26%
12/31/94 $15,304 -3.49%
12/31/95 $17,627 15.18%
12/31/96 $18,183 3.16%
12/31/97 $19,560 7.57%
12/31/98 $20,570 5.16%
8
<PAGE>
OPPENHEIMER MONEY
-----------------
$10,000 purchase payment made December 31, 1988
Non-Standardized
----------------
Accumulated Calendar Year
Date Payment Value Total Return
- ------------------------------------------------------------------------
12/31/88 $10,000 $10,000
12/31/89 $10,753 7.53%
12/31/90 $11,426 6.27%
12/31/91 $11,934 4.44%
12/31/92 $12,199 2.22%
12/31/93 $12,383 1.52%
12/31/94 $12,670 2.31%
12/31/95 $13,171 3.95%
12/31/96 $13,648 3.62%
12/31/97 $14,145 3.64%
12/31/98 $14,653 3.59%
PANORAMA INTERNATIONAL EQUITY
-----------------------------
$10,000 purchase payment made since inception (May 13, 1992)
Non-Standardized
----------------
Accumulated Calendar Year
Date Payment Value Total Return
- ------------------------------------------------------------------------
5/13/92 $10,000 $10,000
12/31/92 $ 9,492 -5.08%
12/31/93 $11,379 19.88%
12/31/94 $11,311 -0.61%
12/31/95 $12,302 8.77%
12/31/96 $13,699 11.35%
12/31/97 $14,573 6.38%
12/31/98 $17,128 17.53%
PANORAMA LIFESPAN CAPITAL APPRECIATION
--------------------------------------
$10,000 purchase payment made since inception (Sept. 1, 1995)
Non-Standardized
----------------
Accumulated Calendar Year
Date Payment Value Total Return
- ------------------------------------------------------------------------
9/1/95 $10,000 $10,000
12/31/95 $10,659 6.59%
12/31/96 $12,319 15.58%
12/31/97 $13,641 10.73%
12/31/98 $14,290 4.76%
PANORAMA LIFESPAN BALANCED
--------------------------
$10,000 purchase payment made since inception (Sept. 1, 1995)
Non-Standardized
----------------
Accumulated Calendar Year
Date Payment Value Total Return
- ------------------------------------------------------------------------
9/1/95 $10,000 $10,000
12/31/95 $10,571 5.71%
12/31/96 $11,774 11.39%
12/31/97 $12,998 10.39%
12/31/98 $13,576 4.44%
9
<PAGE>
PANORAMA LIFESPAN DIVERSIFIED INCOME
------------------------------------
$10,000 purchase payment made since inception (Sept. 1, 1995)
Non-Standardized
----------------
Accumulated Calendar Year
Date Payment Value Total Return
- ------------------------------------------------------------------------
9/1/95 $10,000 $10,000
12/31/95 $10,540 5.40%
12/31/96 $11,060 4.94%
12/31/97 $12,241 10.67%
12/31/98 $12,629 3.17%
FIDELITY VIP II CONTRAFUND
--------------------------
$10,000 purchase payment made since inception (Jan. 3, 1995)
Non-Standardized
----------------
Accumulated Calendar Year
Date Payment Value Total Return
- ------------------------------------------------------------------------
1/3/95 $10,000 $10,000
12/31/95 $13,781 37.81%
12/31/96 $16,435 19.26%
12/31/97 $20,084 22.20%
12/31/98 $25,704 27.98%
T. ROWE PRICE MID-CAP GROWTH
----------------------------
$10,000 purchase payment made since inception (Dec. 31,1996)
Non-Standardized
----------------
Accumulated Calendar Year
Date Payment Value Total Return
- ------------------------------------------------------------------------
12/31/96 $10,000 $10,000
12/31/97 $11,685 16.85%
12/31/98 $14,037 20.13%
AMERICAN CENTURY VP INCOME & GROWTH
-----------------------------------
$10,000 purchase payment made since inception (Oct. 30, 1997)
Non-Standardized
----------------
Accumulated Calendar Year
Date Payment Value Total Return
- ------------------------------------------------------------------------
10/30/97 $10,000 $10,000
12/31/97 $10,754 7.54%
12/31/98 $13,421 24.79%
MML SMALL CAP VALUE EQUITY
--------------------------
$10,000 purchase payment made since inception (June 1, 1998)
Non-Standardized
----------------
Accumulated Calendar Year
Date Payment Value Total Return
- ------------------------------------------------------------------------
6/1/98 $10,000 $10,000
12/31/98 $8,568 -14.32%
The performance figures discussed above reflect historical results of the funds
and are not intended to indicate or to predict future performance.
10
<PAGE>
FEDERAL TAX MATTERS
General
Note: The following description is based upon the Company's understanding of
current federal income tax law applicable to annuities in general. The Company
cannot predict the probability that any changes in such laws will be made.
Purchasers are cautioned to seek competent tax advice regarding the possibility
of such changes. The Company does not guarantee the tax status of the contracts.
Purchasers bear the complete risk that the contracts may not be treated as
"annuity contracts" under federal income tax laws. It should be further
understood that the following discussion is not exhaustive and that special
rules not described herein may be applicable in certain situations. Moreover, no
attempt has been made to consider any applicable state or other tax laws.
Section 72 of the Code governs taxation of annuities in general. An owner is
generally not taxed on increases in the value of a contract until distribution
occurs, either in the form of a lump sum payment or as annuity payments under
the annuity option selected. For a lump sum payment received as a total
withdrawal (total surrender), the recipient is taxed on the portion of the
payment that exceeds the cost basis of the contract. For non-qualified
contracts, this cost basis is generally the purchase payments, while for
qualified contracts there may be no cost basis. The taxable portion of the lump
sum payment is taxed at ordinary income tax rates.
For annuity payments, a portion of each payment in excess of an exclusion amount
is includible in taxable income. The exclusion amount for payments based on a
fixed annuity option is determined by multiplying the payment by the ratio that
the cost basis of the contract (adjusted for any period or refund feature) bears
to the expected return under the contract. The exclusion amount for payments
based on a variable annuity option is determined by dividing the cost basis of
the contract (adjusted for any period certain or refund guarantee) by the number
of years over which the annuity is expected to be paid. Payments received after
the investment in the contract has been recovered (i.e. when the total of the
excludable amount equals the investment in the contract) are fully taxable. The
taxable portion is taxed at ordinary income tax rates. For certain types of
qualified plans there may be no cost basis in the contract within the meaning of
Section 72 of the Code. Owners, annuitants and beneficiaries under the contracts
should seek competent financial advice about the tax consequences of any
distributions.
The Company is taxed as a life insurance company under the Code. For federal
income tax purposes, the separate account is not a separate entity from the
Company, and its operations form a part of the Company.
Diversification
Section 817(h) of the Code imposes certain diversification standards on the
underlying assets of variable annuity contracts. The Code provides that a
variable annuity contract will not be treated as an annuity contract for any
period (and any subsequent period) for which the investments are not, in
accordance with regulations prescribed by the United States Treasury Department
("Treasury Department"), adequately diversified. Disqualification of the
contract as an annuity contract would result in the imposition of federal income
tax to the owner with respect to earnings allocable to the contract prior to the
receipt of payments under the contract. The Code contains a safe harbor
provision which provides that annuity contracts such as the contract meet the
diversification requirements if, as of the end of each quarter, the underlying
assets meet the diversification standards for a regulated investment company and
no more than fifty-five percent (55%) of the total assets consist of cash, cash
items, U.S. Government securities and securities of other regulated investment
companies.
11
<PAGE>
On March 2, 1989, the Treasury Department issued Regulations (Treas.
Reg.1.817-5), which established diversification requirements for the investment
portfolios underlying variable contracts such as the contract. The regulations
amplify the diversification requirements for variable contracts set forth in the
Code and provide an alternative to the safe harbor provision described above.
Under the regulations, an investment portfolio will be deemed adequately
diversified if: (1) no more than 55% of the value of the total assets of the
portfolio is represented by any one investment; (2) no more than 70% of the
value of the total assets of the portfolio is represented by any two
investments; (3) no more than 80% of the value of the total assets of the
portfolio is represented by any three investments; and (4) no more than 90% of
the value of the total assets of the portfolio is represented by any four
investments.
The Code provides that, for purposes of determining whether or not the
diversification standards imposed on the underlying assets of variable contracts
by Section 817(h) of the Code have been met, "each United States government
agency or instrumentality shall be treated as a separate issuer."
The Company intends that all investment portfolios underlying the contracts will
be managed in such a manner as to comply with these diversification
requirements.
The Treasury Department has indicated that the diversification regulations do
not provide guidance regarding the circumstances in which owner control of the
investments of the separate account will cause the owner to be treated as the
owner of the assets of the separate account, thereby resulting in the loss of
favorable tax treatment for the contract. At this time it cannot be determined
whether additional guidance will be provided and what standards may be contained
in such guidance.
The amount of owner control which may be exercised under the contract is
different in some respects from the situations addressed in published rulings
issued by the Internal Revenue Service in which it was held that the policy
owner was not the owner of the assets of the separate account. It is unknown
whether these differences, such as the owner's ability to transfer among
investment choices or the number and type of investment choices available, would
cause the owner to be considered as the owner of the assets of the separate
account resulting in the imposition of federal income tax to the owner with
respect to earnings allocable to the contract prior to receipt of payments under
the contract.
In the event any forthcoming guidance or ruling is considered to set forth a new
position, such guidance or ruling will generally be applied only prospectively.
However, if such ruling or guidance was not considered to set forth a new
position, it may be applied retroactively resulting in the owner being
retroactively determined to be the owner of the assets of the separate account.
Due to the uncertainty in this area, the Company reserves the right to modify
the contract in an attempt to maintain favorable tax treatment.
Multiple Contracts
The Code provides that multiple non-qualified annuity contracts which are issued
within a calendar year to the same contract owner by one company or its
affiliates are treated as one annuity contract for purposes of determining the
tax consequences of any distribution. Such treatment may result in adverse tax
consequences including more rapid taxation of the distributed amounts from such
combination of contracts. Owners should consult a tax adviser prior to
purchasing more than one non-qualified annuity contract in any calendar year.
12
<PAGE>
Contracts Owned by Other than Natural Persons
Under Section 72(u) of the Code, the investment earnings on premiums for the
contracts will be taxed currently to the owner if the owner is a non-natural
person, e.g., a corporation or certain other entities. Such contracts generally
will not be treated as annuities for federal income tax purposes. However, this
treatment is not applied to a contract held by a trust or other entity as an
agent for a natural person nor to contracts held by qualified plans. Purchasers
should consult their own tax counsel or other tax adviser before purchasing a
contract to be owned by a non-natural person.
Tax Treatment of Assignments
An assignment or pledge of a contract may be a taxable event. Owners should
therefore consult competent tax advisers should they wish to assign or pledge
their contracts.
Income Tax Withholding
All distributions or the portion thereof which is includible in the gross income
of the owner are subject to federal income tax withholding. Generally, amounts
are withheld from periodic payments at the same rate as wages and at the rate of
10% from non-periodic payments. However, the owner, in most cases, may elect not
to have taxes withheld or to have withholding done at a different rate.
Effective January 1, 1993, certain distributions from retirement plans qualified
under Section 401 of the Code, which are not directly rolled over to another
eligible retirement plan or individual retirement account or individual
retirement annuity, are subject to a mandatory 20% withholding for federal
income tax. The 20% withholding requirement generally does not apply to: a) a
series of substantially equal payments made at least annually for the life or
life expectancy of the participant or joint and last survivor expectancy of the
participant and a designated beneficiary or for a specified period of 10 years
or more; or b) distributions which are required minimum distributions; or c) the
portion of the distributions not includible in gross income (i.e. returns of
after-tax contributions). The 20% withholding requirement also does not apply to
hardship distributions from a 401(k) plan made after December 31, 1998.
Participants should consult their own tax counsel or other tax adviser regarding
withholding requirements.
Tax Treatment of Withdrawals - Non-Qualified Contracts
Section 72 of the Code governs treatment of distributions from annuity
contracts. It provides that if the contract value exceeds the aggregate purchase
payments made, any amount withdrawn will be treated as coming first from the
earnings and then, only after the income portion is exhausted, as coming from
the principal. Withdrawn earnings are includible in gross income. It further
provides that a ten percent (10%) penalty will apply to the income portion of
any premature distribution. However, the penalty is not imposed on amounts
received: (a) after the taxpayer reaches age 59 1/2; (b) after the death of the
owner; (c) if the taxpayer is totally disabled (for this purpose disability is
as defined in Section 72(m)(7) of the Code); (d) in a series of substantially
equal periodic payments made not less frequently than annually for the life (or
life expectancy) of the taxpayer or for the joint lives (or joint life
expectancies) of the taxpayer and his or her beneficiary; (e) under an immediate
annuity; or (f) which are allocable to purchase payments made prior to August
14, 1982.
With respect to (d) above, if the series of substantially equal periodic
payments is modified before the later of your attaining age 59 1/2 or 5 years
from the date of the first periodic payment, then the tax for the year of the
modification is increased by an amount equal to the tax which would have been
imposed (the 10% tax penalty), but for the exception, plus interest for the tax
years in which the exception was used.
13
<PAGE>
The above information does not apply to qualified contracts. However, separate
tax withdrawal penalties and restrictions may apply to such qualified contracts.
(See "Tax Treatment of Withdrawals - Qualified Contracts" below.)
Qualified Plans
The contracts offered herein are designed to be suitable for use under various
types of qualified plans. Taxation of participants in each qualified plan varies
with the type of plan and terms and conditions of each specific plan. Owners,
annuitants and beneficiaries are cautioned that benefits under a qualified plan
may be subject to the terms and conditions of the plan regardless of the terms
and conditions of the contracts issued pursuant to the plan. Some retirement
plans are subject to distribution and other requirements that are not
incorporated into the Company's administrative procedures. Owners, participants
and beneficiaries are responsible for determining that contributions,
distributions and other transactions with respect to the contracts comply with
applicable law. Following are general descriptions of the types of qualified
plans with which the contracts may be used. Such descriptions are not exhaustive
and are for general informational purposes only. The tax rules regarding
qualified plans are very complex and will have differing applications depending
on individual facts and circumstances. Each purchaser should obtain competent
tax advice prior to purchasing a contract issued under a qualified plan.
Contracts issued pursuant to qualified plans include special provisions
restricting contract provisions that may otherwise be available as described
herein. Generally, contracts issued pursuant to qualified plans are not
transferable except upon surrender or annuitization. Various penalty and excise
taxes may apply to contributions or distributions made in violation of
applicable limitations. Furthermore, certain withdrawal penalties and
restrictions may apply to surrenders from qualified contracts. (See "Tax
Treatment of Withdrawals - Qualified Contracts" below.)
On July 6, 1983, the Supreme Court decided in Arizona Governing Committee v.
Norris that optional annuity benefits provided under an employer's deferred
compensation plan could not, under Title VII of the Civil Rights Act of 1964,
vary between men and women. The contracts sold by the Company in connection with
qualified plans will utilize annuity tables which do not differentiate on the
basis of sex. Such annuity tables will also be available for use in connection
with certain non-qualified deferred compensation plans.
a. H.R. 10 Plans
Section 401 of the Code permits self-employed individuals to establish qualified
plans for themselves and their employees, commonly referred to as "H.R. 10" or
"Keogh" plans. Contributions made to the plan for the benefit of the employees
will not be included in the gross income of the employees until distributed from
the Plan. The tax consequences to participants may vary depending upon the
particular plan design. However, the Code places limitations and restrictions on
all plans including on such items as: amount of allowable contributions; form,
manner and timing of distributions; transferability of benefits; vesting and
nonforfeitability of interests; nondiscrimination in eligibility and
participation; and the tax treatment of distributions, withdrawals and
surrenders. (See "Tax Treatment of Withdrawals Qualified Contracts" below.)
Purchasers of contracts for use with an H.R. 10 Plan should obtain competent tax
advice as to the tax treatment and suitability of such an investment.
b. Individual Retirement Annuities
Section 408(b) of the Code permits eligible individuals to contribute to an
individual retirement program known as an "Individual Retirement Annuity"
("IRA"). Under applicable limitations, certain amounts may be contributed to an
IRA which will be deductible from the individual's gross income. These IRAs
14
<PAGE>
are subject to limitations on eligibility, contributions, transferability and
distributions. (See "Tax Treatment of Withdrawals - Qualified Contracts" below.)
Under certain conditions, distributions from other IRAs and other Qualified
Plans may be rolled over or transferred on a tax-deferred basis into an IRA.
Sales of contracts for use with IRAs are subject to special requirements imposed
by the Code, including the requirement that certain informational disclosure be
given to persons desiring to establish an IRA. Purchasers of contracts to be
qualified as Individual Retirement Annuities should obtain competent tax advice
as to the tax treatment and suitability of such an investment.
Roth IRAs
Section 408A of the Code provides that beginning in 1998, individuals may
purchase a new type of non-deductible IRA, known as a Roth IRA. Purchase
payments for a Roth IRA are limited to a maximum of $2,000 per year. Lower
maximum limitations apply to individuals with adjusted gross incomes between
$95,000 and $110,000 in the case of single taxpayers, between $150,000 and
$160,000 in the case of married taxpayers filing joint returns, and between $0
and $10,000 in the case of married taxpayers filing separately. An overall
$2,000 annual limitation continues to apply to all of a taxpayer's IRA
contributions, including Roth IRA and non-Roth IRAs.
Qualified distributions from Roth IRAs are free from federal income tax. A
qualified distribution requires that an individual has held the Roth IRA for at
least five years and, in addition, that the distribution is made either after
the individual reaches age 59 1/2, on the individual's death or disability, or
as a qualified first-time home purchase, subject to a $10,000 lifetime maximum,
for the individual, a spouse, child, grandchild, or ancestor. Any distribution
which is not a qualified distribution is taxable to the extent of earnings in
the distribution. Distributions are treated as made from contributions first and
therefore no distributions are taxable until distributions exceed the amount of
contributions to the Roth IRA. The 10% penalty tax and the regular IRA
exceptions to the 10% penalty tax apply to taxable distributions from a Roth
IRA.
Amounts may be rolled over from one Roth IRA to another Roth IRA. Furthermore,
an individual may make a rollover contribution from a non-Roth IRA to a Roth
IRA, unless the individual has adjusted gross income over $100,000 or the
individual is a married taxpayer filing a separate return. The individual must
pay tax on any portion of the IRA being rolled over that represents income or a
previously deductible IRA contribution. However, for rollovers in 1998, the
individual may pay that tax ratably over the four taxable year period beginning
with tax year 1998.
Purchasers of contracts to be qualified as a Roth IRA should obtain competent
tax advice as to the tax treatment and suitability of such an investment.
c. Corporate Pension and Profit-Sharing Plans
Sections 401(a) and 401(k) of the Code permit corporate employers to establish
various types of retirement plans for employees. These retirement plans may
permit the purchase of the contracts to provide benefits under the plan.
Contributions to the plan for the benefit of employees will not be includible in
the gross income of the employees until distributed from the plan. The tax
consequences to participants may vary depending upon the particular plan design.
However, the Code places limitations and restrictions on all Plans including on
such items as: amount of allowable contributions; form, manner and timing of
distributions; transferability of benefits; vesting and nonforfeitability of
interests; nondiscrimination in eligibility and participation; and the tax
treatment of distributions, withdrawals and surrenders. (See "Tax Treatment of
Withdrawals - Qualified Contracts" below.) Purchasers of contracts for use with
Corporate Pension or Profit Sharing Plans should obtain competent tax advice as
to the tax treatment and suitability of such an investment.
15
<PAGE>
Tax Treatment of Withdrawals - Qualified Contracts
In the case of a withdrawal under a qualified contract, a ratable portion of the
amount received is taxable, generally based on the ratio of the individual's
cost basis to the individual's total accrued benefit under the retirement plan.
Special tax rules may be available for certain distributions from a qualified
contract. Section 72(t) of the Code imposes a 10% penalty tax on the taxable
portion of any distribution from qualified retirement plans, including contracts
issued and qualified under Code Sections 401 (H.R. 10 and Corporate Pension and
Profit-Sharing Plans), and 408 (Individual Retirement Annuities) and 408A (Roth
IRAs). To the extent amounts are not includible in gross income because they
have been rolled over to an IRA or to another eligible qualified plan, no tax
penalty will be imposed. The tax penalty will not apply to the following
distributions: (a) if distribution is made on or after the date on which the
owner or annuitant (as applicable) reaches age 59 1/2; (b) distributions
following the death or disability of the owner or annuitant (as applicable) (for
this purpose disability is as defined in Section 72(m) (7) of the Code); (c)
after separation from service, distributions that are part of substantially
equal periodic payments made not less frequently than annually for the life (or
life expectancy) of the owner or annuitant (as applicable) or the joint lives
(or joint life expectancies) of such owner or annuitant (as applicable) and his
or her designated beneficiary; (d) distributions to an owner or annuitant (as
applicable) who has separated from service after he has attained age 55; (e)
distributions made to the owner or annuitant (as applicable) to the extent such
distributions do not exceed the amount allowable as a deduction under Code
Section 213 to the Owner or Annuitant (as applicable) for amounts paid during
the taxable year for medical care; (f) distributions made to an alternate payee
pursuant to a qualified domestic relations order; (g) distributions from an
Individual Retirement Annuity for the purchase of medical insurance (as
described in Section 213(d)(1)(D) of the Code) for the owner or annuitant (as
applicable) and his or her spouse and dependents if the owner or annuitant (as
applicable) has received unemployment compensation for at least 12 weeks (this
exception will no longer apply after the owner or annuitant (as applicable) has
been re-employed for at least 60 days); (h) distributions from an Individual
Retirement Annuity made to the owner or annuitant (as applicable) to the extent
such distributions do not exceed the qualified higher education expenses (as
defined in Section 72(t)(7) of the Code) of the owner or annuitant (as
applicable) for the taxable year; and (i) distributions from an Individual
Retirement Annuity made to the owner or annuitant (as applicable) which are
qualified first-time home buyer distributions (as defined in Section 72(t)(8)of
the Code.) The exceptions stated in (d) and (f) above do not apply in the case
of an Individual Retirement Annuity. The exception stated in (c) above applies
to an Individual Retirement Annuity without the requirement that there be a
separation from service.
With respect to (c) above, if the series of substantially equal periodic
payments is modified before the later of your attaining age 59 1/2 or 5 years
from the date of the first periodic payment, then the tax for the year of the
modification is increased by an amount equal to the tax which would have been
imposed (the 10% penalty tax) but for the exception, plus interest for the tax
years in which the exception was used.
Generally, distributions from a qualified plan must begin no later than April
1st of the calendar year following the later of (a) the year in which the
employee attains age 70 1/2 or (b) the calendar year in which the employee
retires. The date set forth in (b) does not apply to an Individual Retirement
Annuity. Required distributions do not apply to a Roth IRA during the lifetime
of the Owner. Required distributions must be over a period not exceeding the
life expectancy of the individual or the joint lives or life expectancies of the
individual and his or her designated beneficiary. If the required minimum
distributions are not made, a 50% penalty tax is imposed as to the amount not
distributed.
Section 457 Deferred Compensation ("Section 457") Plans
Employees of (and independent contractors who perform services for) certain
state and local governmental units, or certain tax-exempt employers, may
participate in a Section 457 plan of the
16
<PAGE>
employer, allowing them to defer part of their salary or other compensation. The
amount deferred, and accrued income thereon, will not be taxable until it is
paid or otherwise made available to the employee.
The maximum amount that can be deferred under a Section 457 plan in any tax year
is generally one-third of the employee's includible compensation, up to $8,000
(in 1998). Includible compensation means earnings for services rendered to the
employer which are includible in the employee's gross income, excluding the
contributions under the Section 457 plan or a Tax-Sheltered Annuity. Certain
catch-up deferrals are permitted during the last three (3) years before an
employee attains normal retirement age. The contract purchased is issued to the
employer, and the employee has no rights or vested interest in the contract. All
contract value must be held for the exclusive benefit of the employee, and
payments can only be made in accordance with Section 457 plan provisions.
Presently, tax-free transfers of assets in a section 457 plan can only be made
to another section 457 plan in certain limited cases.
Purchasers of contracts for use with Section 457 plans should obtain competent
tax advice as to the tax treatment and suitability of such an investment.
EXPERTS
We have included the financial statements of C.M. Life and C.M. Multi-Account A
Panorama Premier in this Statement of Additional Information in reliance on the
reports of PricewaterhouseCoopers LLP, independent accountants, given on the
authority of that firm as experts in accounting and auditing.
PricewaterhouseCoopers LLP's report on the statutory financial statements of
C.M. Life includes explanatory paragraphs relating to the use of statutory
accounting practices rather than generally accepted accounting principles.
PricewaterhouseCoopers LLP is located in Springfield, Massachusetts 01101.
17
<PAGE>
Report Of Independent Accountants
To the Contract Owners of the Panorama Premier Segment of C.M. Multi-Account A
and The Board of Directors of C.M. Life Insurance Company
In our opinion, the accompanying statement of assets and liabilities and the
related statements of operations and of changes in net assets present fairly, in
all material respects, the financial position of each of the sub-accounts of the
C.M Multi-Account A - Panorama Premier (hereafter referred to as "the Account")
at December 31, 1998, the results of each of their operations for the year then
ended and the changes in each of their net assets for each of the two years in
the period then ended, in conformity with generally accepted accounting
principles. These financial statements are the responsibility of the Account's
management; our responsibility is to express an opinion on these financial
statements based on our audits. We conducted our audits of these financial
statements in accordance with generally accepted auditing standards which
require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits, which included
confirmation of investments owned at December 31, 1998 by correspondence with
the investment companies, provide a reasonable basis for the opinion expressed
above.
PricewaterhouseCoopers LLP
Springfield, Massachusetts
February 25, 1999
F-1
<PAGE>
C.M. Multi-Account A - Panorama Premier
STATEMENT OF ASSETS AND LIABILITIES
December 31, 1998
ASSETS
Investments, at Market (Notes 3A and 3B):
Total Return Sub-Account
52,217,130 shares (Cost $96,793,165) $ 99,734,719
Growth Sub-Account
33,927,033 shares (Cost $108,466,480) 110,941,397
International Equity Sub-Account
16,566,115 shares (Cost $23,143,940) 26,008,800
LifeSpan Diversified Income Sub-Account
14,294,040 shares (Cost $16,300,397) 16,724,027
LifeSpan Balanced Sub-Account
29,120,260 shares (Cost $35,545,986) 37,273,933
LifeSpan Capital Appreciation Sub-Account
25,925,182 shares (Cost $33,206,867) 35,258,248
Money Sub-Account
24,399,098 shares (Cost $24,399,098) 24,399,098
Bond Sub-Account
1,550,945 shares (Cost $18,585,666) 19,107,645
Income & Growth Sub-Account
1,268,868 shares (Cost $7,935,796) 8,602,927
Mid-Cap Growth Sub-Account
249,102 shares (Cost $3,138,790) 3,554,686
Contrafund Sub-Account
277,239 shares (Cost $5,855,539) 6,775,714
Small Cap Value Equity Sub-Account
208,534 shares (Cost $1,671,045) 1,770,757
------------
Total investments 390,151,951
Dividends receivable 53,832
------------
Total assets 390,205,783
Payable to C.M. Life Insurance Company 764,723
------------
NET ASSETS $389,441,060
============
<TABLE>
<CAPTION>
Net assets: Units Unit Value Net Assets
----- ---------- ----------
<S> <C> <C> <C>
Total Return Sub-Account 7,175,242 13.876594 $ 99,567,920
Growth Sub-Account 7,066,702 15.669692 110,733,044
International Equity Sub-Account 1,866,209 13.961844 26,055,719
LifeSpan Diversified Income Sub-Account 1,386,641 12.046624 16,704,343
LifeSpan Balanced Sub-Account 2,863,916 12.983356 37,183,241
LifeSpan Capital Appreciation Sub-Account 2,583,238 13.619392 35,182,131
Money Sub-Account 2,167,370 11.150105 24,166,403
Bond Sub-Account 1,610,177 11.725305 18,879,816
Income & Growth Sub-Account 695,584 12.423410 8,641,525
Mid-Cap Growth Sub-Account 279,360 13.076410 3,653,026
Contrafund Sub-Account 539,768 12.598281 6,800,149
Small Cap Value Equity Sub-Account 167,833 11.164329 1,873,743
-------------
$ 389,441,060
=============
</TABLE>
See Notes to Financial Statements.
F-2
<PAGE>
C.M. Multi-Account A - Panorama Premier
STATEMENT OF OPERATIONS
For The Year Ended December 31, 1998
<TABLE>
<CAPTION>
LifeSpan
Total International Diversified LifeSpan
Return Growth Equity Income Balanced
Sub-Account Sub-Account Sub-Account Sub-Account Sub-Account
----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Investment income
Dividends (Note 3B) $ 8,323,214 $ 9,388,799 $ 551,348 $ 523,171 $ 1,623,455
Expenses
Mortality and expense risk fees (Note 4) 1,021,400 1,187,149 273,208 171,390 418,920
----------- ----------- ----------- ----------- -----------
Net investment income (loss)
(Note 3C) 7,301,814 8,201,650 278,140 351,781 1,204,535
----------- ----------- ----------- ----------- -----------
Net realized and unrealized
gain (loss) on investments
Net realized gain on investments
(Notes 3B, 3C and 6) 36,361 401,355 182,759 59,213 394,129
Change in net unrealized
appreciation of investments (144,723) (3,290,478) 2,451,770 107,160 (56,808)
----------- ----------- ----------- ----------- -----------
Net gain (loss) on investments (108,362) (2,889,123) 2,634,529 166,373 337,321
----------- ----------- ----------- ----------- -----------
Net increase in net assets
resulting from operations $ 7,193,452 $ 5,312,527 $ 2,912,669 $ 518,154 $ 1,541,856
=========== =========== =========== =========== ===========
<CAPTION>
LifeSpan
Capital *Income *Mid-Cap *Small Cap
Appreciation Money Bond & Growth Growth *Contrafund Value Equity
Sub-Account Sub-Account Sub-Account Sub-Account Sub-Account Sub-Account Sub-Account
----------- ----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment income
Dividends (Note 3B) $1,614,874 $ 912,425 $ 231,139 $ 31,394 $ 41,543 $ -- $ 6,350
Expenses
Mortality and expense risk fees (Note 4) 426,834 243,503 154,021 13,268 5,788 12,607 3,221
---------- ---------- ---------- ---------- ---------- ---------- ----------
Net investment income (loss)
(Note 3C) 1,188,040 668,922 77,118 18,126 35,755 (12,607) 3,129
---------- ---------- ---------- ---------- ---------- ---------- ----------
Net realized and unrealized
gain (loss) on investments
Net realized gain on investments
(Notes 3B, 3C and 6) 376,686 -- 60,373 2,991 6,745 10,510 3,620
Change in net unrealized
appreciation of investments 54,177 -- 318,002 667,131 415,896 920,175 99,712
---------- ---------- ---------- ---------- ---------- ---------- ----------
Net gain (loss) on investments 430,863 -- 378,375 670,122 422,641 930,685 103,332
---------- ---------- ---------- ---------- ---------- ---------- ----------
Net increase in net assets
resulting from operations $1,618,903 $ 668,922 $ 455,493 $ 688,248 $ 458,396 $ 918,078 $ 106,461
========== ========== ========== ========== ========== ========== ==========
</TABLE>
See Notes to Financial Statements.
F-3
<PAGE>
C.M. Multi-Account A - Panorama Premier
STATEMENT OF CHANGES IN NET ASSETS
For The Year Ended December 31, 1998
<TABLE>
<CAPTION>
LifeSpan
Total International Diversified LifeSpan
Return Growth Equity Income Balanced
Sub-Account Sub-Account Sub-Account Sub-Account Sub-Account
----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Increase in net assets
Operations:
Net investment income (loss) $ 7,301,814 $ 8,201,650 $ 278,140 $ 351,781 $ 1,204,535
Net realized gain on investments 36,361 401,355 182,759 59,213 394,129
Change in net unrealized
appreciation of investments (144,723) (3,290,478) 2,451,770 107,160 (56,808)
------------- ------------- ------------- ------------- -------------
Net increase in net assets
resulting from operations 7,193,452 5,312,527 2,912,669 518,154 1,541,856
------------- ------------- ------------- ------------- -------------
Capital transactions:
Net contract payments 21,793,430 22,769,817 4,334,610 3,522,525 6,769,672
Withdrawal of funds (2,648,109) (3,241,984) (878,429) (446,509) (1,206,327)
Transfer due to death benefits (865,237) (400,899) (85,813) (51,169) (364,577)
Transfer due to reimbursement (payment)
of accumulation unit value fluctuation 16,194 (18,074) 10,279 (123,844) (16,610)
Transfers between Sub-Accounts
and the Fixed Account 25,728,082 29,141,299 6,378,366 4,542,924 7,118,499
------------- ------------- ------------- ------------- -------------
Net increase in net assets resulting
from capital transactions 44,024,360 48,250,159 9,759,013 7,443,927 12,300,657
------------- ------------- ------------- ------------- -------------
Total increase 51,217,812 53,562,686 12,671,682 7,962,081 13,842,513
NET ASSETS, at beginning of the year 48,350,108 57,170,358 13,384,037 8,742,262 23,340,728
------------- ------------- ------------- ------------- -------------
NET ASSETS, at end of the year $ 99,567,920 $ 110,733,044 $ 26,055,719 $ 16,704,343 $ 37,183,241
============= ============= ============= ============= =============
<CAPTION>
LifeSpan
Capital *Income *Mid-Cap
Appreciation Money Bond & Growth Growth *Contrafund
Sub-Account Sub-Account Sub-Account Sub-Account Sub-Account Sub-Account
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Increase in net assets
Operations:
Net investment income (loss) $ 1,188,040 $ 668,922 $ 77,118 $ 18,126 $ 35,755 $ (12,607)
Net realized gain on investments 376,686 -- 60,373 2,991 6,745 10,510
Change in net unrealized
appreciation of investments 54,177 -- 318,002 667,131 415,896 920,175
------------ ------------ ------------ ----------- ----------- -----------
Net increase in net assets
resulting from operations 1,618,903 668,922 455,493 688,248 458,396 918,078
------------ ------------ ------------ ----------- ----------- -----------
Capital transactions:
Net contract payments 5,192,360 98,994,193 5,448,973 2,937,905 713,287 2,053,632
Withdrawal of funds (1,033,454) (840,877) (477,703) (52,547) (37,911) (39,745)
Transfer due to death benefits (184,615) (12,610) (22,097) -- -- --
Transfer due to reimbursement (payment)
of accumulation unit value fluctuation (122,490) (34,544) 97,077 29,423 21,274 15,760
Transfers between Sub-Accounts
and the Fixed Account 3,922,470 (88,257,988) 6,943,847 5,038,496 2,497,980 3,852,424
------------ ------------ ------------ ----------- ----------- -----------
Net increase in net assets resulting
from capital transactions 7,774,271 9,848,174 11,990,097 7,953,277 3,194,630 5,882,071
------------ ------------ ------------ ----------- ----------- -----------
Total increase 9,393,174 10,517,096 12,445,590 8,641,525 3,653,026 6,800,149
NET ASSETS, at beginning of the year 25,788,957 13,649,307 6,434,226 -- -- --
------------ ------------ ------------ ----------- ----------- -----------
NET ASSETS, at end of the year $ 35,182,131 $ 24,166,403 $ 18,879,816 $ 8,641,525 $ 3,653,026 $ 6,800,149
============ ============ ============ =========== =========== ===========
<CAPTION>
*Small Cap
Value Equity
Sub-Account
-----------
<S> <C>
Increase in net assets
Operations:
Net investment income (loss) $ 3,129
Net realized gain on investments 3,620
Change in net unrealized
appreciation of investments 99,712
-----------
Net increase in net assets
resulting from operations 106,461
-----------
Capital transactions:
Net contract payments 734,308
Withdrawal of funds (18,997)
Transfer due to death benefits --
Transfer due to reimbursement (payment)
of accumulation unit value fluctuation 3,507
Transfers between Sub-Accounts
and the Fixed Account 1,048,464
-----------
Net increase in net assets resulting
from capital transactions 1,767,282
-----------
Total increase 1,873,743
NET ASSETS, at beginning of the year --
-----------
NET ASSETS, at end of the year $ 1,873,743
===========
</TABLE>
*For the Period September 1, 1998 (Commencement of Operations) Through December
31, 1998.
See Notes to Financial Statements.
F-4
<PAGE>
C.M. Multi-Account A - Panorama Premier
STATEMENT OF CHANGES IN NET ASSETS
For The Year Ended December 31, 1997
<TABLE>
<CAPTION>
LifeSpan
Total International Diversified LifeSpan
Return Growth Equity Income Balanced
Sub-Account Sub-Account Sub-Account Sub-Account Sub-Account
----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Increase (decrease) in net assets
Operations:
Net investment income $ 1,844,974 $ 1,231,950 $ 16,275 $ 75,256 $ 204,764
Net realized gain on investments 125,668 350,940 97,075 141,119 116,847
Change in net unrealized
appreciation of investments 2,289,961 4,650,165 270,130 211,187 1,367,082
------------ ------------ ------------ ----------- ------------
Net increase in net assets
resulting from operations 4,260,603 6,233,055 383,480 427,562 1,688,693
------------ ------------ ------------ ----------- ------------
Capital transactions:
Net contract payments 10,966,415 14,781,455 3,579,300 2,860,309 5,876,887
Withdrawal of funds (827,884) (878,869) (205,373) (79,222) (972,925)
Transfer due to death benefits (328,830) (189,084) (7,481) (23,806)
Transfers between Sub-Accounts
and the Fixed Account 18,932,159 22,423,795 6,068,143 2,906,587 5,674,230
------------ ------------ ------------ ----------- ------------
Net increase in net assets resulting
from capital transactions 28,741,860 36,137,297 9,434,589 5,687,674 10,554,386
------------ ------------ ------------ ----------- ------------
Total increase 33,002,463 42,370,352 9,818,069 6,115,236 12,243,079
NET ASSETS, at beginning of the year 15,347,645 14,800,006 3,565,968 2,627,026 11,097,649
------------ ------------ ------------ ----------- ------------
NET ASSETS, at end of the year $ 48,350,108 $ 57,170,358 $ 13,384,037 $ 8,742,262 $ 23,340,728
============ ============ ============ =========== ============
<CAPTION>
LifeSpan
Capital
Appreciation Money Bond
Sub-Account Sub-Account Sub-Account
------------ ------------ -----------
<S> <C> <C> <C>
Increase (decrease) in net assets
Operations:
Net investment income $ 199,057 $ 385,621 $ 208,767
Net realized gain on investments 83,111 -- 14,428
Change in net unrealized
appreciation of investments 1,627,933 -- 184,181
------------ ------------ -----------
Net increase in net assets
resulting from operations 1,910,101 385,621 407,376
------------ ------------ -----------
Capital transactions:
Net contract payments 6,942,332 64,204,637 2,384,346
Withdrawal of funds (332,973) (191,954) (171,016)
Transfer due to death benefits (38,628) (61,386) --
Transfers between Sub-Accounts
and the Fixed Account 6,671,402 (56,137,816) 1,279,253
------------ ------------ -----------
Net increase in net assets resulting
from capital transactions 13,242,133 7,813,481 3,492,583
------------ ------------ -----------
Total increase 15,152,234 8,199,102 3,899,959
NET ASSETS, at beginning of the year 10,636,723 5,450,205 2,534,267
------------ ------------ -----------
NET ASSETS, at end of the year $ 25,788,957 $ 13,649,307 $ 6,434,226
============ ============ ===========
</TABLE>
F-5
<PAGE>
C.M. Multi-Account A - Panorama Premier
Notes To Financial Statements
1. HISTORY
C.M. Multi-Account A (the "Separate Account") was established as a
separate investment account of C.M. Life Insurance Company ("C.M. Life").
C.M. Life is a wholly-owned subsidiary of Massachusetts Mutual Life
Insurance Company ("MassMutual").
C.M. Life maintains two segments within the Separate Account. The segments
are Panorama Premier and OFFITBANK. These notes and the financial
statements presented herein describe and consist only of the Panorama
Premier segment (the "Segment") The Segment is used exclusively for C.M.
Life's Individual Deferred Variable Annuity Contracts with Flexible
Purchase Payments (the "Contracts") known as Panorama Premier.
The Separate Account operates as a registered unit investment trust
pursuant to the Investment Company Act of 1940.
2. INVESTMENT OF SEGMENT'S ASSETS
The Segment maintains twelve Sub-Accounts. Each Sub-Account invests in
corresponding shares of either the: MML Series Investment Fund ("MML
Trust"), Panorama Series Fund, Inc. ("Panorama Fund"), Oppenheimer
Variable Account Funds ("Oppenheimer Trust"), American Century Variable
Portfolios, Inc. ("American Century"), T. Rowe Price Equity Series, Inc.
("T. Rowe Price Equity Series") and Fidelity Variable Insurance Products
Fund II ("Fidelity VIP II").
The MML Trust is a no-load, open-end, management investment company
registered under the Investment Company Act of 1940. One of six of its
separate series is available to the Segment's contractowners: MML Small
Cap Value Equity Fund. MassMutual serves as investment manager of each of
the MML Funds pursuant to an investment management agreement. David L.
Babson & Company, Inc., a controlled subsidiary of MassMutual, serves as
the investment Sub-Adviser to the MML Small Cap Value Equity Fund.
The Panorama Fund is an open-end, diversified, management investment
company registered under the Investment Company Act of 1940 with six of
its portfolios currently available to the Segment's contractowners:
Panorama Total Return Portfolio, Panorama Growth Portfolio, Panorama
International Equity Portfolio, Panorama LifeSpan Diversified Income
Portfolio, Panorama LifeSpan Balanced Portfolio and Panorama LifeSpan
Capital Appreciation Portfolio. OppenheimerFunds, Inc. ("OFI"), a
controlled subsidiary of MassMutual, serves as the investment adviser to
the Panorama Fund. OFI has engaged three Sub-Advisers to assist in the
selection of portfolio investments for the Panorama International Equity
Portfolio, Panorama LifeSpan Diversified Income Portfolio, Panorama
LifeSpan Balanced Portfolio and the Panorama LifeSpan Capital Appreciation
Portfolio. Babson-Stewart Ivory International serves as the investment
Sub-Adviser to the Panorama International Equity Portfolio and the
international stock components of the Panorama Life-Span Balanced
Portfolio and the Panorama LifeSpan Capital Appreciation Portfolio. BEA
Associates serves as the investment Sub-Adviser to the high yield bond
components of the three LifeSpan Portfolios. Pilgrim, Baxter & Associates
serves as the investment Sub-Adviser to the small cap components of the
Panorama LifeSpan Balanced Portfolio and the Panorama LifeSpan Capital
Appreciation Portfolio.
Oppenheimer Trust is an open-end, diversified, management investment
company registered under the Investment Company Act of 1940 with two of
its Funds currently available to the Segment's contractowners: Oppenheimer
Money Fund and Oppenheimer Bond Fund. OFI serves as investment manager to
the Oppenheimer Trust.
American Century Variable Portfolios, Inc., is an open-end, diversified,
management investment company with one of its Portfolios currently
available to the Segment's contractowners: American Century VP Income &
Growth. American Century Investment Management, Inc. is the investment
manager to the American Century VP Income & Growth Portfolio.
T. Rowe Price Equity Series is an open-end, diversified, investment
company with one of its series of shares currently available to the
Segment's contractowners: the T. Rowe Price Mid-Cap Growth Portfolio. T.
Rowe Price Associates, Inc. is the investment manager to the T. Rowe Price
Mid-Cap Growth Portfolio.
Fidelity VIP II is an open-end, diversified, investment company registered
under the Investment Company Act of 1940 with one of its Portfolios
available to the Segment's contractowners: the VIP II Contrafund
Portfolio. Fidelity Management & Research Company ("FMR") is the
investment manager to the VIP II Contrafund Portfolio. Fidelity Management
& Research (U.K.) Inc. and Fidelity Management & Research (Far East) Inc.,
serve as the investment Sub-Adviser to the VIP II Contrafund Portfolio.
F-6
<PAGE>
Notes To Financial Statements (Continued)
In addition to the twelve Sub-Accounts, contractowners may also allocate
funds to either of two Fixed Accounts: the Fixed Account and the Fixed
Account for Dollar Cost Averaging ("DCA Fixed Account") , which is part of
C.M. Life's General Account. Because of exemptive and exclusionary
provision, interests in the two Fixed Accounts, are not registered under
the Securities Act of 1933. Also, the Fixed Accounts are not registered as
an investment company under the Investment Company Act of 1940.
3. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed
consistently by the Segment in preparation of the financial statements in
conformity with generally accepted accounting principles.
A. Investment Valuation
Investments in the MML Trust, Panorama Fund, Oppenheimer Trust, American
Century, T. Rowe Price Equity Series and Fidelity VIP II are each stated
at market value which is the net asset value per share of each of the
respective underlying portfolios.
B. Accounting for Investments
Investment transactions are accounted for on the trade date and identified
cost is the basis followed in determining the cost of investments sold for
financial statement purposes. Dividend income is recorded on the
ex-dividend date.
C. Federal Income Taxes
Operations of the Segment form a part of the total operations of C.M.
Life, and the Segment is not taxed separately. C.M. Life is taxed as a
life insurance company under the provisions of the 1986 Internal Revenue
Code, as amended. The Segment will not be taxed as a "regulated investment
company" under Subchapter M of the Internal Revenue Code. Under existing
federal law, no taxes are payable on investment income and realized
capital gains attributable to contracts which depend on the Segment's
investment performance. Accordingly, no provision for federal income tax
has been made. C.M. Life may, however, make such a charge in the future if
an unanticipated change of current law results in a company tax liability
attributable to the Segment.
D. Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires that management make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
4. CHARGES
There are no deductions for sales charges made from purchase payments.
However, if a withdrawal is made, a contingent deferred sales charge may
be assessed by C.M. Life. Any premium taxes relating to the Contracts may
be deducted from the purchase payments or contract value when annuity
payments or withdrawals are made. Premium taxes generally range from 0% to
3.5%.
There is also an annual contract maintenance charge of $30 per Contract,
imposed each year for the expenses incurred by C.M. Life for the
establishment and maintenance of the Contract and related administrative
expenses.
For assuming mortality and expense risks, C.M. Life deducts a charge
equal, on an annual basis, to 1.25% of the average daily net asset value
of the Separate Account's assets. C.M. Life also deducts an administrative
charge equal, on an annual basis, to .15% of the average daily net assets
of the Separate Account. These charges cover expenses in connection with
the administration of the Separate Account and the contracts.
5. DISTRIBUTION AGREEMENTS
MML Distributors, LLC ("MML Distributors"), a wholly-owned subsidiary of
MassMutual, serves as principal underwriter of the contracts pursuant to
an underwriting and servicing agreement among MML Distributors, C.M. Life
and C.M. Multi-Account A. MML Distributors is registered with the
Securities and Exchange Commission (the "SEC") as a broker-dealer under
the Securities Exchange Act of 1934 and is a member of the National
Association of Securities Dealers, Inc. (the "NASD"). MML Distributors may
enter into selling agreements with other broker-dealers who are registered
with the SEC and are members of the NASD in order to sell the contracts.
F-7
<PAGE>
Notes To Financial Statements (Continued)
MML Investors Services, Inc. ("MMLISI"), a wholly-owned subsidiary of
MassMutual, serves as co-underwriter of the contracts pursuant to
underwriting and servicing agreements among MMLISI, C.M. Life and C.M.
Multi-Account A. MMLISI is registered with the SEC as a broker-dealer
under the Securities Exchange Act of 1934 and is a member of the NASD.
Registered representatives of MMLISI sell the contracts as authorized
variable life insurance agents under applicable state insurance laws.
Pursuant to underwriting and servicing agreements, commissions or other
fees due to registered representatives for selling and servicing the
contracts are paid by C.M. Life on behalf of MML Distributors or MMLISI.
MML Distributors and MMLISI also receive compensation for their actions as
underwriters of the contracts.
6. PURCHASES AND SALES OF INVESTMENTS
<TABLE>
<CAPTION>
LifeSpan LifeSpan
Total International Diversified LifeSpan Capital
For The Year Ended Return Growth Equity Income Balanced Appreciation
December 31, 1998 Sub-Account Sub-Account Sub-Account Sub-Account Sub-Account Sub-Account
- ----------------- ----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Cost of purchases $54,459,181 $60,405,276 $11,350,859 $9,023,497 $16,815,713 $12,086,077
Proceeds from sales $ 2,970,389 $ 3,752,551 $ 1,363,260 $1,208,717 $ 3,220,385 $ 3,048,832
</TABLE>
<TABLE>
<CAPTION>
*Income *Mid-Cap *Small Cap
For The Year Ended Money Bond and Growth Growth *Contrafund Value Equity
December 31, 1998 (Cont) Sub-Account Sub-Account Sub-Account Sub-Account Sub-Account Sub-Account
- ------------------------ ----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Cost of purchases $46,956,108 $13,607,885 $7,954,964 $3,182,388 $5,991,308 $1,729,320
Proceeds from sales $36,176,998 $ 1,313,345 $ 22,159 $ 50,343 $ 146,279 $ 61,895
</TABLE>
*For the Period September 1, 1998 (Commencement of Operations) Through December
31, 1998.
F-8
<PAGE>
Notes To Financial Statements (Continued)
7. NET INCREASE IN ACCUMULATION UNITS
<TABLE>
<CAPTION>
LifeSpan
Total International Diversified LifeSpan
For The Year Ended Return Growth Equity Income Balanced
December 31, 1998 Sub-Account Sub-Account Sub-Account Sub-Account Sub-Account
- ----------------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Units purchased 2,122,244 1,852,347 380,343 324,232 665,608
Units withdrawn (270,203) (242,055) (72,106) (41,945) (123,390)
Units transferred between divisions 1,512,964 1,555,528 429,283 353,834 439,556
--------- --------- --------- --------- ---------
Net increase 3,365,005 3,165,820 737,520 636,121 981,774
Units, at beginning of the year 3,810,237 3,900,882 1,128,689 750,520 1,882,142
--------- --------- --------- --------- ---------
Units, at end of the year 7,175,242 7,066,702 1,866,209 1,386,641 2,863,916
========= ========= ========= ========= =========
<CAPTION>
LifeSpan
Capital *Income *Mid-Cap *Small Cap
For The Year Ended Appreciation Money Bond & Growth Growth *Contrafund Value Equity
December 31, 1998 Sub-Account Sub-Account Sub-Account Sub-Account Sub-Account Sub-Account Sub-Account
- ----------------- ----------- ----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Units purchased 423,483 9,117,233 529,224 273,063 77,157 211,536 77,722
Units withdrawn (91,183) (77,639) (43,392) (4,397) (3,161) (3,313) (1,771)
Units transferred between divisions 262,608 (8,142,886) 546,417 426,918 205,364 331,545 91,882
--------- --------- --------- ------- ------- ------- -------
Net increase 594,908 896,708 1,032,249 695,584 279,360 539,768 167,833
Units, at beginning of the year 1,988,330 1,270,662 577,928 -- -- -- --
--------- --------- --------- ------- ------- ------- -------
Units, at end of the year 2,583,238 2,167,370 1,610,177 695,584 279,360 539,768 167,833
========= ========= ========= ======= ======= ======= =======
</TABLE>
*For the Period September 1, 1998 (Commencement of Operations) Through December
31,1998.
<TABLE>
<CAPTION>
LifeSpan
Total International Diversified LifeSpan
For The Year Ended Return Growth Equity Income Balanced
December 31, 1997 Sub-Account Sub-Account Sub-Account Sub-Account Sub-Account
- ----------------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Units purchased 1,063,300 1,366,404 341,080 265,750 522,891
Units withdrawn (101,623) (69,651) (15,761) (15,814) (82,919)
Units transferred between divisions 1,431,604 1,345,748 482,792 250,356 452,033
---------- ---------- ---------- -------- ----------
Net increase 2,393,281 2,642,501 808,111 500,292 892,005
Units, at beginning of the year 1,416,956 1,258,381 320,578 250,228 990,137
---------- ---------- ---------- -------- ----------
Units, at end of the year 3,810,237 3,900,882 1,128,689 750,520 1,882,142
========== ========== ========== ======== ==========
<CAPTION>
LifeSpan
Capital
For The Year Ended Appreciation Money Bond
December 31, 1997 Sub-Account Sub-Account Sub-Account
- ----------------- ----------- ----------- -----------
<S> <C> <C> <C>
Units purchased 600,696 6,328,326 218,259
Units withdrawn (35,654) (23,668) (7,069)
Units transferred between divisions 513,250 (5,560,966) 121,500
---------- ---------- --------
Net increase 1,078,292 743,692 332,690
Units, at beginning of the year 910,038 526,970 245,238
---------- ---------- --------
Units, at end of the year 1,988,330 1,270,662 577,928
========== ========== ========
</TABLE>
F-9
<PAGE>
Report Of Independent Accountants
To the Board of Directors and Policyholders of
C.M. Life Insurance Company
We have audited the accompanying statutory statements of financial position of
C.M. Life Insurance Company as of December 31, 1998 and 1997, and the related
statutory statements of income and changes in shareholder's equity, and of cash
flows for each of the three years in the period ended December 31, 1998. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
As described in Note 1, these financial statements were prepared in conformity
with accounting practices prescribed or permitted by the Department of Insurance
of the State of Connecticut, which practices differ from generally accepted
accounting principles. The effects on the financial statements of the variances
between the statutory basis of accounting and generally accepted accounting
principles, although not reasonably determinable, are presumed to be material.
In our opinion, because of the effects of the matter discussed in the preceding
paragraph, the financial statements audited by us do not present fairly, in
conformity with generally accepted accounting principles, the financial position
of C.M. Life Insurance Company as of December 31, 1998 and 1997, or the results
of its operations or its cash flows for each of the three years in the period
ended December 31, 1998.
In our opinion, the financial statements audited by us present fairly, in all
material respects, the financial position of C.M. Life Insurance Company as of
December 31, 1998 and 1997, and the results of its operations and its cash flows
for each of the three years in the period ended December 31, 1998, on the basis
of accounting described in Note 1.
PricewaterhouseCoopers LLP
Springfield, Massachusetts
February 25, 1999
FF-1
<PAGE>
C.M. Life Insurance Company
STATUTORY STATEMENTS OF FINANCIAL POSITION
December 31,
1998 1997
---- ----
(In Millions)
Assets:
Bonds $ 683.0 $ 664.5
Mortgage loans 126.3 101.6
Other investments 76.3 63.6
Policy loans 150.4 142.5
Cash and short-term investments 105.7 88.4
-------- --------
1,141.7 1,060.6
Investment and insurance amounts
receivable 33.9 30.1
Federal income tax receivable 2.1 --
Transfer due from separate accounts 34.3 32.0
-------- --------
1,212.0 1,122.7
Separate account assets 1,318.9 1,096.5
-------- --------
$2,530.9 $2,219.2
======== ========
See notes to statutory financial statements.
FF-2
<PAGE>
C.M. Life Insurance Company
STATUTORY STATEMENTS OF FINANCIAL POSITION, Continued
December 31,
1998 1997
---- ----
($ In Millions Except for Par Value)
Liabilities:
Policyholders' reserves and funds $ 996.3 $ 951.0
Policyholders' claims and other benefits 3.8 4.5
Payable to parent 28.8 13.6
Federal income taxes -- 6.1
Asset valuation and other investment reserves 23.9 26.6
Other liabilities 18.2 7.7
-------- --------
1,071.0 1,009.5
Separate account liabilities 1,318.9 1,096.5
-------- --------
2,389.9 2,106.0
-------- --------
Shareholder's equity:
Common stock, $200 par value
50,000 shares authorized
12,500 shares issued and outstanding 2.5 2.5
Paid-in and contributed surplus 68.8 43.8
Surplus 69.7 66.9
-------- --------
141.0 113.2
-------- --------
$2,530.9 $2,219.2
======== ========
See notes to statutory financial statements.
FF-3
<PAGE>
C.M. Life Insurance Company
STATUTORY STATEMENTS OF INCOME
Years Ended December 31,
1998 1997 1996
---- ---- ----
(In Millions)
Revenue:
Premium income $406.4 $331.3 $314.4
Net investment income 82.4 75.3 75.2
Fees and other income 5.5 7.5 8.7
------ ------ ------
494.3 414.1 398.3
------ ------ ------
Benefits and expenses:
Policyholders' benefits and payments 185.2 100.4 99.0
Addition to policyholders' reserves and funds 168.8 200.7 217.8
Operating expenses 72.1 49.5 45.4
Commissions 49.6 33.5 25.0
State taxes, licenses and fees 8.1 3.5 3.2
------ ------ ------
483.8 387.6 390.4
------ ------ ------
Net gain from operations before federal
income taxes 10.5 26.5 7.9
Federal income taxes 6.8 19.0 6.3
------ ------ ------
Net gain from operations 3.7 7.5 1.6
Net realized capital gain (loss) (1.1) 0.1 0.6
------ ------ ------
Net income $ 2.6 $ 7.6 $ 2.2
====== ====== ======
See notes to statutory financial statements.
FF-4
<PAGE>
C.M. Life Insurance Company
STATUTORY STATEMENTS OF CHANGES IN SHAREHOLDER'S EQUITY
Years Ended December 31,
1998 1997 1996
---- ---- ----
(In Millions)
Shareholder's equity, beginning of year $113.2 $109.8 $113.2
------ ------ ------
Increases (decreases) due to:
Net income 2.6 7.6 2.2
Change in asset valuation and investment
reserves 2.7 (4.8) (1.9)
Change in net unrealized capital gain (loss) (5.8) 0.8 (1.0)
Capital contribution 25.0 -- --
Other 3.3 (0.2) (2.7)
------ ------ ------
27.8 3.4 (3.4)
------ ------ ------
Shareholder's equity, end of year $141.0 $113.2 $109.8
====== ====== ======
See notes to statutory financial statements.
FF-5
<PAGE>
C.M. Life Insurance Company
STATUTORY STATEMENTS OF CASH FLOWS
Years Ended December 31,
1998 1997 1996
---- ---- ----
(In Millions)
Operating activities:
Net income $ 2.6 $ 7.6 $ 2.2
Additions to policyholders' reserves and funds
net of transfers to separate accounts 44.6 44.2 41.6
Net realized capital (gain) loss 1.1 (0.1) (0.6)
Other changes 7.8 0.5 (0.8)
------- ------- -------
Net cash provided by operating activities 56.1 52.2 42.4
------- ------- -------
Investing activities:
Loans and purchases of investments (568.6) (438.6) (184.9)
Sales and maturities of investments and
receipts from repayment of loans 504.8 411.1 191.1
------- ------- -------
Net cash provided by (used in) investing
activities (63.8) (27.5) 6.2
------- ------- -------
Financing Activities:
Capital and surplus contribution 25.0 -- --
------- ------- -------
Increase in cash and short-term investments 17.3 24.7 48.6
Cash and short-term investments, beginning of
year 88.4 63.7 15.1
------- ------- -------
Cash and short-term investments, end of year $ 105.7 $ 88.4 $ 63.7
======= ======= =======
See notes to statutory financial statements
FF-6
<PAGE>
NOTES TO STATUTORY FINANCIAL STATEMENTS
C.M. Life Insurance Company (the Company) is a wholly-owned stock life
insurance subsidiary of Massachusetts Mutual Life Insurance Company
("MassMutual"). On March 1, 1996, the operations of the Company's former
parent, Connecticut Mutual Life Insurance Company, were merged into
MassMutual. The Company is primarily engaged in the sale of flexible premium
universal life insurance and variable annuity products distributed through
career agents. The Company is licensed to sell life insurance and annuities
in Puerto Rico, the District of Columbia and 49 states (excluding New York).
1. SUMMARY OF ACCOUNTING PRACTICES
The accompanying statutory financial statements, have been prepared in
conformity with the statutory accounting practices of the National
Association of Insurance Commissioners ("NAIC") and the accounting practices
prescribed or permitted by the Department of Insurance of the State of
Connecticut and are different in some respects from financial statements
prepared in accordance with generally accepted accounting principles
("GAAP"). The more significant differences are as follows: (a) acquisition
costs, such as commissions and other costs directly related to acquiring new
business, are charged to current operations as incurred, whereas GAAP would
require these expenses to be capitalized and recognized over the life of the
policies; (b) policy reserves are based upon statutory mortality and
interest requirements without consideration of withdrawals, whereas GAAP
reserves would be based upon reasonably conservative estimates of mortality,
morbidity, interest and withdrawals; (c) bonds are generally carried at
amortized cost whereas GAAP generally requires they be reported at fair
value; (d) deferred income taxes are not provided for book-tax timing
differences as would be required by GAAP; and (e) payments received for
universal life products and variable annuities are reported as premium
revenue, whereas under GAAP, these payments would be recorded as deposits to
policyholders' account balances.
In March 1998, the NAIC adopted the Codification of Statutory Accounting
Principles ("Codification"). Codification provides a comprehensive guide of
statutory accounting principles for use by insurers in all states and is
expected to become effective no later than January 1, 2001. The effect of
adopting Codification shall be reported as an adjustment to surplus on the
effective date. The Company is currently reviewing the impact of
Codification; however, since the Department of Insurance of the State of
Connecticut has not approved Codification, the ultimate impact cannot be
determined at this time.
The preparation of financial statements requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities, as well as disclosures of contingent assets and liabilities, at
the date of the financial statements. Management must also make estimates
and assumptions that affect the amounts of revenues and expenses during the
reporting period. Future events, including changes in the levels of
mortality, morbidity, interest rates and asset valuations, could cause
actual results to differ from the estimates used in these financial
statements.
Certain 1997 and 1996 amounts have been reclassed to conform with the
current year presentation.
The following is a description of the Company's principal accounting
policies and practices.
A. Investments
Bonds are valued in accordance with rules established by the NAIC.
Generally, bonds are valued at amortized cost.
Mortgage loans are valued at unpaid principal net of unamortized premium or
discount. The Company discontinues the accrual of interest on mortgage loans
which are delinquent more than 90 days or when collection is uncertain.
FF-7
<PAGE>
Notes To Statutory Financial Statements (Continued)
Policy loans are carried at the outstanding loan balance less amounts
unsecured by the cash surrender value of the policy.
Short-term investments are stated at amortized cost, which approximates fair
value.
Other invested assets include investments in affiliated mutual funds and
preferred stocks and are valued in accordance with rules established by the
NAIC. Generally, investments in mutual funds are valued at fair value and
preferred stocks in good standing at cost.
In compliance with regulatory requirements, the Company maintains an Asset
Valuation Reserve ("AVR") and an Interest Maintenance Reserve ("IMR"). The
AVR and other investment reserves stabilize surplus against fluctuations in
the value of stocks, as well as declines in the value of bonds and mortgage
loans. The IMR captures after-tax realized capital gains and losses which
result from changes in the overall level of interest rates for all types of
fixed income investments and interest related hedging activities. These
interest related gains and losses are amortized into income using the grouped
method over the remaining life of the investment sold or over the remaining
life of the underlying asset. Net realized after-tax capital gains of $2.6
million in 1998, $2.0 million in 1997 and $0.4 million in 1996 were
transferred to the IMR. Amortization of the IMR into net investment income
amounted to $0.3 million in 1998 and $0.1 million in 1997 and 1996. At
December 31, 1997, the IMR consisted of a net loss deferral, which, in
accordance with the regulations, was recorded as a reduction of surplus.
Realized capital gains and losses, less taxes, not includable in the IMR, are
recognized in net income. Realized capital gains and losses are determined
using the specific identification method. Unrealized capital gains and losses
are included in surplus.
B. Separate Accounts
Separate account assets and liabilities represent segregated funds
administered and invested by the Company for the benefit of variable annuity
contract holders. Assets consist principally of marketable securities
reported at fair value. Transfers due from separate accounts represent the
policyholders' account values in excess of statutory benefit reserves.
Premiums, benefits and expenses of the separate accounts are reported in the
Statutory Statement of Income. The Company receives administrative and
investment advisory fees from these accounts.
Net transfers to separate accounts of $121.0 million, $146.5 million and
$170.5 million in 1998, 1997 and 1996, respectively, are included in the
addition to policyholders' reserves and funds.
C. Non-admitted Assets
Assets designated as "non-admitted" (principally prepaid agent commissions,
other prepaid expenses and the IMR, when in a net loss deferral position) are
excluded from the statutory statement of financial position. These amounted
to $5.5 million and $5.7 million as of December 31, 1998 and 1997,
respectively and changes therein are charged directly to surplus.
D. Policyholders' Reserves and Funds
Policyholders' reserves for life insurance contracts are developed using
accepted actuarial methods computed principally on the net level premium, the
Commissioners' Reserve Valuation Method and the California Method bases using
the 1980 Commissioners' Standard Ordinary mortality tables with assumed
interest rates ranging from 3.0 to 4.5 percent.
FF-8
<PAGE>
Notes To Statutory Financial Statements (Continued)
Reserves for individual annuities are based on accepted actuarial methods,
principally at interest rates ranging from 5.25 to 9.0 percent. Reserves for
policies and contracts considered investment contracts have a carrying value
of $129.8 million and $115.6 million at December 31, 1998 and 1997,
respectively with a fair value of $132.8 million and $116.0 million at
December 31, 1998 and 1997, respectively as determined by discounted cash
flow projections.
The Company made certain changes in the valuation of policyholders' reserves
which increased surplus by $2.7 million in 1998.
E. Premium and Related Expense Recognition
Life insurance premium revenue is recognized annually on the anniversary date
of the policy. Annuity premium is recognized when received. Commissions and
other costs related to the issuance of new policies, maintenance and
settlement costs are charged to current operations when incurred.
F. Cash and Short-term Investments
For purposes of the Statutory Statement of Cash Flows, the Company considers
all highly liquid short-term investments purchased with a maturity of twelve
months or less to be short-term investments.
2. FEDERAL INCOME TAXES
Provision for federal income taxes is based upon the Company's estimate of
its tax liability. No deferred tax effect is recognized for temporary
differences that may exist between financial reporting and taxable income.
Accordingly, the reporting of miscellaneous temporary differences, such as
reserves and acquisition costs, resulted in effective tax rates which differ
from the statutory tax rate.
The Company plans to file a separate company 1998 federal income tax return.
The Internal Revenue Service has completed its examination of the Company's
income tax returns through the year 1995.
Federal tax payments were $16.9 million in 1998, $6.8 million in 1997 and
$17.6 million in 1996.
3. SHAREHOLDER'S EQUITY
The Board of Directors of MassMutual has authorized the contribution of funds
to the Company sufficient to meet the capital requirements of all states in
which the Company is licensed to do business. Substantially all of the
statutory shareholder's equity is subject to dividend restrictions relating
to various state regulations, which limit the payment of dividends to the
shareholder without prior approval. Under these regulations, $11.3 million of
shareholder's equity is available for distribution to the shareholder in 1999
without prior regulatory approval.
During 1998, MassMutual contributed additional paid-in capital of $25.0
million to the Company.
4. RELATED PARTY TRANSACTIONS
MassMutual and the Company have an agreement whereby MassMutual, for a fee,
furnishes the Company, as required, operating facilities, human resources,
computer software development and managerial services. Also, investment and
administrative services are provided to the Company pursuant to a management
services agreement with MassMutual. Similar arrangements were in place with
Connecticut Mutual Life Insurance Company, the Company's former parent, prior
to its merger with MassMutual. Fees incurred under the terms of these
agreements were $74.1 million, $39.7 million and $45.9 million in 1998, 1997
and 1996, respectively.
FF-9
<PAGE>
Notes To Statutory Financial Statements (Continued)
Prior to March 1, 1996, the Company had an underwriting agreement with its
affiliates GR Phelps & Co., Inc. and MML Distributors LLC. Under this
agreement, the affiliates paid commissions and received the cash flows from
variable annuity contract fees. Effective March 1, 1996, this agreement was
cancelled, and the Company began paying all commissions and retained the
right to the related future cash flows from contract fees.
The Company cedes a portion of its life insurance business to MassMutual and
other insurers in the normal course of business. The Company's retention
limit per individual insured is $12.0 million; the portion of the risk
exceeding the retention limit is reinsured with other insurers. The Company
is contingently liable with respect to ceded reinsurance in the event any
reinsurer is unable to fulfill its contractual obligations.
The Company has a modified coinsurance quota-share reinsurance agreement with
MassMutual whereby the Company cedes 75% of the premiums on certain universal
life policies. In return, MassMutual pays the Company a stipulated expense
allowance, death and surrender benefits, and a modified coinsurance
adjustment based upon experience. Reserves for payment of future benefits for
the ceded policies are retained by the Company.
The Company also has a stop-loss agreement with MassMutual under which the
Company cedes claims which, in aggregate, exceed 18% of the covered volume
for any year, with maximum coverage of $25.0 million above the aggregate
limit. The aggregate limit was $36.9 million in 1998, $35.6 million in 1997,
and $28.1 million in 1996 and it was not exceeded in any of the years. The
Company paid approximately $1.0 million in premiums to MassMutual under the
agreement in 1998 and 1997, and $0.4 million in 1996.
5. INVESTMENTS
The Company maintains a diversified investment portfolio. Investment policies
limit concentration in any asset class, geographic region, industry group,
economic characteristic, investment quality or individual investment.
A. Bonds
The carrying value and estimated fair value of investments in bonds as of
December 31, 1998 and 1997 are as follows:
December 31, 1998
-----------------
Gross Gross Estimated
Carrying Unrealized Unrealized Fair
Value Gains Losses Value
-------- ---------- ---------- ---------
(In Millions)
U. S. Treasury securities $ 69.3 $ 1.4 $ 0.1 $ 70.6
and obligations of U.S.
government corporations
and agencies
Debt securities issued by 3.2 -- 0.1 3.1
foreign governments
Mortgage-backed securities 57.9 1.6 0.2 59.3
State and local governments 12.1 0.4 0.2 12.3
Corporate debt securities 522.6 17.8 3.0 537.4
Utilities 17.9 0.9 -- 18.8
-------- ------- ------ --------
Total $ 683.0 $ 22.1 $ 3.6 $ 701.5
======== ======= ====== ========
FF-10
<PAGE>
Notes To Statutory Financial Statements (Continued)
December 31, 1997
-----------------
Gross Gross Estimated
Carrying Unrealized Unrealized Fair
Value Gains Losses Value
-------- ---------- ---------- ---------
(In Millions)
U. S. Treasury securities $ 104.3 $ 2.2 $ 0.2 $ 106.3
and obligations of U.S.
government corporations
and agencies
Debt securities issued by 4.6 -- 0.3 4.3
foreign governments
Mortgage-backed securities 38.8 1.0 0.2 39.6
State and local governments 20.0 0.3 -- 20.3
Corporate debt securities 471.8 15.6 1.9 485.5
Utilities 25.0 1.1 -- 26.1
-------- ------- ------ --------
Total $ 664.5 $ 20.2 $ 2.6 $ 682.1
======== ======= ====== ========
The carrying value and estimated fair value of bonds at December 31, 1998, by
contractual maturity, are shown below. Expected maturities will differ from
contractual maturities because borrowers may have the right to call or prepay
obligations with or without prepayment penalties.
<TABLE>
<CAPTION>
Estimated
Carrying Fair
Value Value
-------- ---------
(In Millions)
<S> <C> <C>
Due in one year or less $ 52.2 $ 52.5
Due after one year through five years 216.8 223.2
Due after five years through ten years 233.1 240.0
Due after ten years 69.4 72.1
-------- --------
571.5 587.8
Mortgage-backed securities, including
securities guaranteed by the U.S.
Government 111.5 113.7
-------- --------
Total $ 683.0 $ 701.5
======== ========
</TABLE>
Proceeds from sales of investments in bonds were $480.4 million during 1998,
$388.8 million during 1997, and $162.9 million during 1996. Gross capital
gains of $5.0 million in 1998, $3.8 million in 1997, and $1.6 million in 1996
and gross capital losses of $0.9 million in 1998, $0.5 million in 1997, and
$0.9 million in 1996 were realized on those sales, portions of which were
included in the IMR. Estimated fair value of non-publicly traded bonds is
determined by the Company using a pricing matrix and quoted market prices for
publicly traded bonds.
B. Mortgages
The fair value of mortgage loans, as determined from a pricing matrix for
performing loans and the estimated underlying real estate value for non-
performing loans, approximated carrying value.
The Company had restructured loans with book values of $10.4 million and
$17.3 million at December 31, 1998 and 1997, respectively. The loans
typically have been modified to defer a portion of the contractual interest
payments to future periods. Interest deferred to future periods totaled $0.2
million in 1998, 1997 and 1996. At December 31, 1998, scheduled commercial
mortgage loan maturities were as follows: 1999 - $8.6 million; 2000 - $1.5
million; 2001 - $10.3 million; 2002 - $15.0 million; 2003 - $8.6 million; and
$37.0 million thereafter.
FF-11
<PAGE>
Notes To Statutory Financial Statements (Continued)
C. Policy Loans
Policy loans are recorded at cost as it is not practicable to determine the
fair value since they do not have a stated maturity.
D. Other
Investments in affiliated mutual funds had a cost of $62.4 million in 1998
and $50.2 million in 1997 with fair values of $67.7 million in 1998 and $61.4
million in 1997, using quoted market prices. Preferred stocks in good
standing had fair values of $0.5 million in 1998 using a pricing matrix for
non-publicly traded stocks and quoted market prices for publicly traded
stocks. At December 31, 1998, the fair values of preferred stocks
approximated cost. The Company did not invest in any preferred stocks at
December 31, 1997.
The carrying value of investments which were non-income producing for the
preceding twelve months was $0.4 million at December 31, 1998 and 1997.
6. PORTFOLIO RISK MANAGEMENT
The Company manages its investment risks primarily to reduce interest rate
and duration imbalances determined in asset/liability analyses. The fair
values of these instruments, which are not recorded in the financial
statements, are based upon market prices or prices obtained from brokers. The
Company does not hold or issue these financial instruments for trading
purposes.
The notional amounts described do not represent amounts exchanged by the
parties and, thus, are not a measure of the exposure of the Company. The
amounts exchanged are calculated on the basis of the notional amounts and the
other terms of the instruments, which relate to interest rates, exchange
rates, security prices or financial or other indexes.
The Company utilizes interest rate swap agreements, options, and purchased
caps and floors to reduce interest rate exposures arising from mismatches
between assets and liabilities and to modify portfolio profiles to manage
other risks identified. Under interest rate swaps, the Company agrees to an
exchange, at specified intervals, between streams of variable rate and fixed
rate interest payments calculated by reference to an agreed-upon notional
principal amount. Gains and losses realized on the termination of contracts
are deferred and amortized through the IMR over the remaining life of the
associated contract. IMR amortization is included in net investment income on
the Statutory Statement of Income. Net amounts receivable and payable are
accrued as adjustments to investment income and included in investment and
insurance amounts receivable on the Statutory Statement of Financial
Position. At December 31, 1998 and 1997, the Company had swaps outstanding
with notional amounts of $197.5 million and $46.5 million, respectively. The
fair value of these instruments was $2.7 million at December 31, 1998 and
$0.2 million at December 31, 1997.
Options grant the purchaser the right to buy or sell a security or enter into
a derivative transaction at a stated price within a stated period. The
Company's option contracts have terms of up to ten years. The amounts paid
for options purchased are amortized into investment income over the life of
the contract on a straight-line basis. Unamortized costs are included in
other investments on the Statutory Statement of Financial Position. Gains and
losses on these contracts are recorded at the expiration or termination date
and are deferred and amortized through the IMR over the remaining life of the
option contract. At December 31, 1998 and 1997, the Company had option
contracts with notional amounts of $961.2 million and $111.3 million,
respectively. The Company's credit risk exposure was limited to the
unamortized costs of $7.5 million and $2.2 million which had fair values of
$9.8 million and $2.3 million at December 31, 1998 and 1997, respectively.
FF-12
<PAGE>
Notes To Statutory Financial Statements (Continued)
Interest rate cap agreements grant the purchaser the right to receive the
excess of a referenced interest rate over a stated rate calculated by
reference to an agreed upon notional amount. Interest rate floor agreements
grant the purchaser the right to receive the excess of a stated rate over a
referenced interest rate calculated by reference to an agreed upon notional
amount. Amounts paid for interest rate caps and floors are amortized into
investment income over the life of the asset on a straight-line basis.
Unamortized costs are included in other investments on the Statutory
Statement of Financial Position. Amounts receivable and payable are accrued
as adjustments to investment income and included in the Statutory Statement
of Financial Position as investment and insurance amounts receivable. Gains
and losses on these contracts, including any unamortized cost, are recognized
upon termination and are deferred and amortized through the IMR over the
remaining life of the associated cap or floor agreement. At December 31,
1998, the Company had agreements with notional amounts of $355.0 million. The
Company's credit risk exposure on these agreements is limited to the
unamortized costs of $0.5 million. The fair values of these instruments were
$1.6 million at December 31, 1998. At December 31, 1997, the Company did not
have any open interest rate caps or floor agreements.
The Company utilizes asset swap agreements to reduce exposures, such as
currency risk and prepayment risk, built into certain assets acquired. Cross-
currency interest rate swaps allow investment in foreign currencies,
increasing access to additional investment opportunities, while limiting
foreign exchange risk. The net cash flows from asset and currency swaps are
recognized as adjustments to the underlying assets' investment income. Gains
and losses realized on the termination of these contracts adjusts the bases
of the underlying asset. Notional amounts relating to asset and currency
swaps totaled $1.0 million at December 31, 1997. The fair values of these
instruments were an unrealized gain of $0.1 million at December 31, 1997. As
of December 31, 1998, the Company did not have any open asset swap
agreements.
The Company enters into forward U.S. Treasury, Government National Mortgage
Association ("GNMA") and Federal National Mortgage Association ("FNMA")
commitments for the purpose of managing interest rate exposure. The Company
generally does not take delivery on forward commitments. These commitments
are instead settled with offsetting transactions. Gains and losses on forward
commitments are recorded when the commitment is closed and amortized through
the IMR over the remaining life of the asset. At December 31, 1998 and 1997,
the Company had U. S. Treasury, GNMA and FNMA purchase commitments which will
settle during the following year with contractual amounts of $1.0 million and
$3.0 million, respectively.
The Company is exposed to credit-related losses in the event of
nonperformance by counterparties to derivative financial instruments. This
exposure is limited to contracts with a positive fair value. The amounts at
risk in a net gain position were $14.2 million and $2.6 million at December
31, 1998 and 1997, respectively. The Company monitors exposure to ensure
counterparties are credit worthy and concentration of exposure is minimized.
Additionally, collateral positions have been obtained with counterparties
when considered prudent.
7. BUSINESS RISKS AND CONTINGENCIES
The Company is subject to insurance guaranty fund laws in the states in which
it does business. These laws assess insurance companies amounts to be used to
pay benefits to policyholders and claimants of insolvent insurance companies.
Many states allow these assessments to be credited against future premium
taxes. The Company believes such assessments in excess of amounts accrued
will not materially affect its financial position, results of operations or
liquidity.
The Company is involved in litigation arising in and out of the normal course
of its business. Management intends to defend these actions vigorously. While
the outcome of litigation cannot be foreseen with certainty, it is the
opinion of management, after consultation with legal counsel, that the
ultimate resolution of these matters will not materially impact its financial
position, results of operations or liquidity.
8. AFFILIATED COMPANIES
The relationship of the Company, its parent and affiliated companies as of
December 31, 1998 is illustrated below. Subsidiaries are wholly-owned by the
parent, except as noted.
FF-13
<PAGE>
Notes To Statutory Financial Statements (Continued)
Parent
------
Massachusetts Mutual Life Insurance Company
Subsidiaries of Massachusetts Mutual Life Insurance Company
-----------------------------------------------------------
CM Assurance Company
CM Benefit Insurance Company
C.M. Life Insurance Company
MassMutual Holding Company
MassMutual of Ireland, Limited
MML Bay State Life Insurance Company
MML Distributors, LLC
MassMutual Mortgage Finance, LLC
Subsidiaries of MassMutual Holding Company
------------------------------------------
GR Phelps & Co., Inc.
MassMutual Holding Trust I
MassMutual Holding Trust II
MassMutual Holding MSC, Inc.
MassMutual International, Inc.
MML Investor Services, Inc.
Subsidiaries of MassMutual Holding Trust I
------------------------------------------
Antares Capital Corporation - 99.4%
Charter Oak Capital Management, Inc. - 80.0%
Cornerstone Real Estate Advisors, Inc.
DLB Acquisition Corporation - 85.8%
Oppenheimer Acquisition Corporation - 89.36%
Subsidiaries of MassMutual Holding Trust II
-------------------------------------------
CM Advantage, Inc.
CM International, Inc.
CM Property Management, Inc.
HYP Management, Inc.
MMHC Investments, Inc.
MML Realty Management
Urban Properties, Inc.
MassMutual Benefits Management, Inc.
Subsidiaries of MassMutual International, Inc.
----------------------------------------------
Compensa de Seguros de Vida S.A. - 33.5%
MassLife Seguros de Vida (Argentina) S. A.
MassMutual International (Bermuda) Ltd.
Mass Seguros de Vida (Chile) S. A. - 33.5%
MassMutual International (Luxembourg) S. A.
MassMutual Holding MSC, Inc.
----------------------------
MassMutual Corporate Value Limited - 40.93%
9048 - 5434 Quebec, Inc.
1279342 Ontario Limited
Affiliates of Massachusetts Mutual Life Insurance Company
---------------------------------------------------------
MML Series Investment Fund
MassMutual Institutional Funds
Oppenheimer Value Stock Fund
FF-14
<PAGE>
PART C
OTHER INFORMATION
ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS
(a) FINANCIAL STATEMENTS
Financial Statements Included in Part A
Condensed Financial Information
Financial Statements Included in Part B
The Registrant
Report of Independent Accountants
Statement of Assets and Liabilities as of December 31, 1998
Statement of Operations for the year ended December 31, 1998
Statement of Changes in Net Assets for the years ended December 31, 1998,
December 31, 1997
Notes to Financial Statements
The Depositor
Reports of Independent Accountants
Statutory Statements of Financial Position as of December 31,
1998 and 1997
Statutory Statements of Income for the years ended December 31, 1998, 1997
and 1996
Statutory Statements of Changes in Shareholder's equity for the years
ended December 31, 1998, 1997 and 1996
Statutory Statements of Cash Flows for the years ended December 31, 1998,
1997 and 1996
Notes to Statutory Financial Statements
(b) EXHIBITS
Exhibit 1 Resolution of Board of Directors of the Company
authorizing the establishment of the Separate Account.9
Exhibit 2 Not Applicable.
Exhibit 3 (i) Principal Underwriting Agreement.1
(ii) Broker/Dealer Agreement.1
(iii) Form of Producer's Agreement.1
(iv) Underwriting and Servicing Agreement.1
Exhibit 4 Individual Variable Deferred Annuity Contract.1
Exhibit 5 Application Form.1
Exhibit 6 (i) Copy of Articles of Incorporation of the Company.2
(ii) Copy of the Bylaws of the Company.2
Exhibit 7 Not Applicable.
3
<PAGE>
Exhibit 8 (a) Copy of the Form of Participation Agreement with
Oppenheimer Variable Account Funds.4
(b) Copy of the Form of Participation Agreement with
Panorama Series Fund, Inc.4
(c) Copy of the Form of Participation Agreement with T.
Rowe Price Equity Series, Inc.7
(d) Copy of the Form of Participation Agreement with
Fidelity's Variable Insurance Products Fund II.7
(e) Copy of the Form of Participation Agreement with
American Century Variable Portfolios, Inc.8
Exhibit 9 Opinion of and Consent of Counsel.11
Exhibit 10 (i) Consent of Independent Accountants,
PricewaterhouseCoopers LLP.11
(ii) Powers of Attorney. 6
(iii) Power of Attorney for Robert J. O'Connell.10
Exhibit 11 Not Applicable.
Exhibit 12 Not Applicable.
Exhibit 13 Form of Schedule of Computation of Performance.5
Exhibit 14 Not Applicable.
1 Incorporated by reference to Registrant's Form N-4 filed, on
August 9, 1995.
2 Incorporated by reference to Post Effective Amendment No. 3 to
Registration Statement File No. 33-91072.
3 Incorporated by reference to Post Effective Amendment No. 4 to
Registration No. 333-2347.
4 Incorporated by reference to Registration Statement File No.
333-22557, filed on February 28, 1997.
5 Incorporated by reference to Post Effective Amendment No. 2 to
Registration Statement File No. 33-61679.
6 Incorporated by reference to Post-Effective Amendment No. 4 to
Registration Statement No. 33-61679, filed on Form N-4 on
December 21, 1998.
7 Incorporated by reference to Initial Registration Statement
No. 333-65887, filed on Form S-6 on October 20, 1998.
8 Incorporated by reference to Pre-Effective Amendment No. 1 to
Registration Statement No. 333-41667 filed on Form S-6 on
March 19, 1998.
9 Incorporated by reference to Post-Effective Amendment No. 3 to
Registration Statement No. 33-61679, filed and effective May
1, 1998.
10 Incorporated by reference to Port-Effective Amendment No. 6 to
Registration statement No. 333-41667 filed on Form S-6 in
April, 1999.
11 Filed herewith.
4
<PAGE>
ITEM 25. DIRECTORS AND OFFICERS OF THE DEPOSITOR
C.M. LIFE INSURANCE COMPANY
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
Name, Position, Business Address Principal Occupation(s) During Past Five Years
<S> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
Lawrence V. Burkett, Jr., Director C.M. Life
President and Chief Executive Officer Director, President and Chief Executive Officer (since 1996)
1295 State Street MassMutual
Springfield, MA 01111 Executive Vice President and General Counsel (since 1993)
Senior Vice President and Deputy General Counsel (1992-1993)
- ------------------------------------------------------------------------------------------------------------------------------------
John B. Davies, Director C.M. Life
1295 State Street Director (since 1996)
Springfield, MA 01111 MassMutual
Executive Vice President (since 1994)
Senior Vice President (1994-1994)
General Agent (1982-1993)
- ------------------------------------------------------------------------------------------------------------------------------------
Isadore Jermyn, Director and Senior C.M. Life
Vice President and Actuary Director (since 1998); Senior Vice President and Actuary (since 1996)
1295 State Street MassMutual
Springfield, MA 01111 Senior Vice President and Actuary (since 1999 and 1995-1998)
Senior Vice President and Chief Actuary (1998-1999)
Vice President and Actuary (1980-1995)
- ------------------------------------------------------------------------------------------------------------------------------------
James E. Miller, Director and Senior C.M. Life
Vice President-Life Operations Director and Senior Vice President-Life Operations (since 1998)
140 Garden Street MassMutual
Hartford, CT 06154 Executive Vice President (since 1997 and 1987-1996)
UniCare Life & Health
Senior Vice President (1996-1997)
- ------------------------------------------------------------------------------------------------------------------------------------
Robert J. O'Connell, Director, C.M. Life
1295 State Street Director (since 1999)
Springfield, MA 01111 MassMutual
President and Chief Executive Officer (since 1999)
American International Group, Inc.
Senior Vice President (1991-1998)
AIG Life Companies
President and Chief Executive Officer (1991-1998)
- ------------------------------------------------------------------------------------------------------------------------------------
Stuart H. Reese, Director and Senior C.M. Life
Vice President-Investments Director and Senior Vice President-Investments (since 1996)
1295 State Street MassMutual
Springfield, MA 01111 Chief Executive Director-Investment Management (since 1997)
Senior Vice Presidnet (since 1993)
Aetna Life and Casualty and Affiliates
Investment Manager (1979-1993)
- ------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL OFFICERS (other than those who are also directors)
- ------------------------------------------------------------------------------------------------------------------------------------
Anne Melissa Dowling, Senior Vice C.M. Life
President-Large Corporate Marketing Senior Vice President-Large Corporate Marketing (since 1996)
140 Garden Street MassMutual
Hartford, CT 06154 Senior Vice President (since 1996)
Connecticut Mutual Life Insurance Company
Chief Investment Officer (1994-1996)
Travelers Insurance Co.
Senior Vice President-international (1987-1993)
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
5
<PAGE>
<TABLE>
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C>
Edward M. Kline, Treasurer C.M. Life
1295 State Street Treasurer (since 1997)
Springfield, MA 01111 MassMutual
Vice President (since 1989) and Treasurer (since 1997)
- ------------------------------------------------------------------------------------------------------------------------------------
Ann F. Lomeli, Secretary C.M. Life
1295 State Street Secretary (since 1998)
Springfield, MA 01111 MassMutual
Vice President, Secretary and Deputy General Counsel (since 1999)
Vice Presdient, Secretary and Associate General Counsel (1998-1999)
Vice Presdient, Associate Secretary and Associate General Counsel
(1996-1998)
Connecticut Mutual Life Insurance Company
Corporate Secretary and Counsel (1998-1996)
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
ITEM 26. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE DEPOSITOR OR
REGISTRANT
The assets of the Registrant, under state law, are assets of C.M. Life.
C.M. Life Insurance Company is 100% owned by Massachusetts Mutual Life Insurance
Company.
The Registrant may also be deemed to be under common control with other separate
accounts established by MassMutual and its life insurance subsidiaries, C.M.
Life Insurance Company and MML Bay State Life Insurance Company, which are
registered as unit investment trusts under the Investment Company Act of 1940.
The discussion that follows indicates those entities owned directly or
indirectly by Massachusetts Mutual Life Insurance Company:
MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY
CORPORATE ORGANIZATION
A. DIRECT SUBSIDIARIES OF MASSMUTUAL
MassMutual is the sole owner of each subsidiary unless otherwise
indicated.
1. CM Assurance Company, a Connecticut corporation which operates as a life
and health insurance company. This subsidiary is inactive.
2. CM Benefit Insurance Company, a Connecticut corporation which operates as
a life and health insurance company. This subsidiary is inactive.
3. C.M. Life Insurance Company, a Connecticut corporation which operates as a
life and health insurance company.
4. MML Bay State Life Insurance Company, a Connecticut corporation which
operates as a life and health insurance company.
5. MML Distributors, LLC, a Connecticut limited liability company which
operates as a securities broker-dealer. (MassMutual - 99%; G.R. Phelps &
Co., Inc. - 1%)
6
<PAGE>
6. MassMutual of Ireland, Limited, a corporation organized in the Republic of
Ireland which formerly operated to provide claims service to holders of
MassMutual group life and accident and health insurance contracts. This
subsidiary is inactive and will be dissolved in the near future.
7. MassMutual Holding Company, a Delaware corporation which operates as a
holding company for certain MassMutual entities.
8. MassMutual Mortgage Finance, LLC, a Delaware limited liability company
which makes, acquires, holds and sells mortgage loans.
B. MASSMUTUAL HOLDING COMPANY GROUP
MassMutual Holding Company is the sole owner of each subsidiary or
affiliate unless otherwise indicated.
1. G.R. Phelps & Co, Inc., a Connecticut corporation which formerly operated
as a securities broker-dealer. This subsidiary is inactive and expected to
be dissolved.
2. MML Investors Services, Inc., a Massachusetts corporation which operates
as a securities broker-dealer. (MassMutual Holding Company - 86%; G.R.
Phelps & Co., Inc. - 14%)
3. MassMutual Holding MSC, Inc., a Massachusetts corporation which operates
as a holding company for MassMutual positions in investment entities
organized outside of the United States. This subsidiary qualifies as a
"Massachusetts Security Corporation" under Chapter 63 of the Massachusetts
General Laws.
4. MassMutual Holding Trust I, a Massachusetts business trust which operates
as a holding company for separately-staffed MassMutual investment
subsidiaries.
5. MassMutual Holding Trust II, a Massachusetts business trust which operates
as a holding company for non-staffed MassMutual investment subsidiaries.
6. MassMutual International, Inc., a Delaware corporation which operates as a
holding company for those entities constituting MassMutual's international
insurance operations.
C. MML INVESTORS SERVICES, INC. GROUP
Set forth below are the direct and indirect subsidiaries of MML Investors
Services, Inc. The parent is the sole owner of each subsidiary unless
otherwise indicated.
Direct Subsidiaries of MML Investors Services, Inc.
1. MML Insurance Agency, Inc., a Massachusetts corporation which operates as
an insurance broker.
2. MML Securities Corporation, a Massachusetts corporation which operates as
a "Massachusetts Security Corporation" under Section 63 of the
Massachusetts General Laws.
Direct Subsidiaries of MML Insurance Agency, Inc.
1. DISA Insurance Services of America, Inc., an Alabama corporation which
operates as an insurance broker.
2. Diversified Insurance Services of America, Inc., a Hawaii corporation
which operates as an insurance broker.
3. MML Insurance Agency of Mississippi, P.C., a Mississippi corporation which
operates as an insurance broker.
7
<PAGE>
4. MML Insurance Agency of Nevada, Inc., a Nevada corporation which operates
as an insurance broker.
5. MML Insurance Agency of Ohio, Inc. an Ohio corporation which operates as
an insurance broker. (Controlled by MML Insurance Agency, Inc. through a
voting trust agreement.)
6. MML Insurance Agency of Texas, Inc., a Texas corporation which operates as
an insurance broker. (Controlled by MML Insurance Agency, Inc. through an
irrevocable proxy arrangement.)
D. MASSMUTUAL HOLDING MSC, INC. GROUP
MassMutual Holding MSC, Inc. is the sole owner of each subsidiary or
affiliate unless otherwise indicated.
1. MassMutual Corporate Value Limited, a Cayman Islands corporation which
holds a 90% ownership interest in MassMutual Corporate Value Partners
Limited, another Cayman Islands corporation operating as a high-yield bond
fund. (MassMutual Holding MSC, Inc. - 46%)
2. 9048-5434 Quebec, Inc., a Canadian corporation which operates as the owner
of Hotel du Parc in Montreal, Quebec, Canada.
3. 1279342 Ontario Limited, a Canadian corporation which operates as the
owner of Deerhurst Resort in Huntsville, Ontario, Canada.
E. MASSMUTUAL HOLDING TRUST I GROUP
Set forth below are the direct and indirect subsidiaries and affiliates of
MassMutual Holding Trust I. The parent is the sole owner of each
subsidiary unless otherwise indicated.
Direct Subsidiaries of MassMutual Holding Trust I
1. Antares Capital Corporation, a Delaware corporation which operates as a
finance company. (MassMutual Holding Trust I - 99%)
2. Charter Oak Capital Management, Inc., a Delaware corporation which
operates as a manager of institutional investment portfolios. (MassMutual
Holding Trust I - 80%)
3. Cornerstone Real Estate Advisers, Inc., a Massachusetts corporation which
operates as an investment adviser.
4. DLB Acquisition Corporation, a Delaware corporation which operates as a
holding company for the David L. Babson companies (MassMutual Holding
Trust I - 85%).
5. Oppenheimer Acquisition Corp., a Delaware corporation which operates as a
holding company for the Oppenheimer companies (MassMutual Holding Trust I
- 89%).
Direct Subsidiary of DLB Acquisition Corporation
David L. Babson and Company Incorporated, a Massachusetts corporation which
operates as an investment adviser.
Direct Affiliates of David L. Babson and Company Incorporated
1. Babson Securities Corporation, a Massachusetts corporation which operates
as a securities broker-dealer.
8
<PAGE>
2. Babson-Stewart Ivory International, a Massachusetts general partnership
which operates as an investment adviser. (David L. Babson and Company
Incorporated - 50%).
3. Potomac Babson Incorporated, a Massachusetts corporation which operates as
an investment adviser (David L. Babson and Company Incorporated - 60%).
Direct Subsidiary of Oppenheimer Acquisition Corp.
OppenheimerFunds, Inc., a Colorado corporation which operates as the investment
adviser to the Oppenheimer Funds.
Direct Subsidiaries of OppenheimerFunds, Inc.
1. Centennial Asset Management Corporation, a Delaware corporation which
operates as investment adviser and general distributor of the Centennial
Funds.
2. HarbourView Asset Management Corporation, a New York corporation which
operates as an investment adviser.
3. OppenheimerFunds Distributor, Inc., a New York corporation which operates
as a securities broker-dealer.
4. Oppenheimer Partnership Holdings, Inc., a Delaware corporation which
operates as a holding company.
5. Oppenheimer Real Asset Management, Inc., a Delaware corporation which is
the sub-adviser to a mutual fund investing in the commodities markets.
6. Shareholder Financial Services, Inc., a Colorado corporation which
operates as a transfer agent for mutual funds.
7. Shareholder Services, Inc., a Colorado corporation which operates as a
transfer agent for various Oppenheimer and MassMutual funds.
Direct Subsidiary of Centennial Asset Management Corporation
Centennial Capital Corporation, a Delaware corporation which formerly sponsored
a unit investment trust.
Direct Affiliate of Cornerstone Real Estate Advisers, Inc.
Cornerstone Office Management, LLC, a Delaware limited liability company which
serves as the general partner of Cornerstone Suburban Office, L.P. (Cornerstone
Real Estate Advisers, Inc. - 50%; MML Realty Management Corporation - 50%).
F. MASSMUTUAL HOLDING TRUST II GROUP
MassMutual Holding Trust II is the sole owner of each subsidiary.
1. CM Advantage, Inc., a Connecticut corporation which serves as a general
partner of real estate limited partnerships. The subsidiary is largely
inactive and will be dissolved in the near future.
2. CM International, a Delaware corporation which is the issuer of
collateralized mortgage obligation securities.
9
<PAGE>
3. CM Property Management, Inc., a Connecticut corporation which serves as
the general partner of Westheimer 335 Suites Limited Partnership. The
partnership holds a ground lease with respect to hotel property in
Houston, Texas.
4. HYP Management, Inc., a Delaware corporation which operates as the "LLC
Manager" of MassMutual High Yield Partners II LLC, a high yield bond fund.
5. MassMutual Benefits Management, Inc., a Delaware corporation which
supports MassMutual with benefit plan administration and planning
services.
6. MMHC Investment, Inc., a Delaware corporation which is a passive investor
in MassMutual/Darby CBO IM, Inc., MassMutual/Darby CBO LLC, MassMutual
High Yield Partners II LLC, and other MassMutual investments.
7. MML Realty Management Corporation, a Massachusetts corporation which
formerly operated as a manager of properties owned by MassMutual.
8. Urban Properties, Inc., a Delaware corporation which serves as a general
partner of real estate limited partnerships and as a real estate holding
company.
Direct Affiliate of MMHC Investment, Inc.
MassMutual/Darby CBO IM Inc., a Delaware corporation which operates as the "LLC
Manager" of MassMutual/Darby CBO LLC, a collateralized bond obligation fund.
(MMHC Investment, Inc. - 50%)
Direct Affiliate of MML Realty Management Corporation
Cornerstone Office Management, LLC, a Delaware limited liability company which
serves as the general partner of Cornerstone Suburban Office, L.P. (MML Realty
Management Corporation - 50%; Cornerstone Real Estate Advisers, Inc. - 50%).
G. MASSMUTUAL INTERNATIONAL, INC. GROUP
Set forth below are the direct or indirect subsidiaries and affiliates of
MassMutual International, Inc. The parent is the sole owner of each
subsidiary or affiliate unless otherwise indicated.
Direct Affiliates of MassMutual International, Inc.
1. MassMutual Internacional (Argentina) S.A., a corporation organized in the
Argentine Republic which operates as a holding company. (MassMutual
International, Inc. - 99%; MassMutual Holding Company - 1%)
2. MassMutual Internacional (Chile) S.A., a corporation organized in the
Republic of Chile which operates as a holding company. (MassMutual
International, Inc. - 99%; MassMutual Holding Company - 1%)
3. MassMutual International (Bermuda) Ltd., a corporation organized in
Bermuda which operates as a life insurance company.
4. MassMutual International (Luxembourg) S.A., a corporation organized in the
Grand Duchy of Luxembourg which operates as a life insurance company.
(MassMutual International, Inc. - 99%; MassMutual Holding Company - 1%)
5. MassLife Seguros de Vida, S.A., a corporation organized in the Argentine
Republic which operates as a life insurance company. (MassMutual
International, Inc. - 99.9%)
10
<PAGE>
Direct Subsidiaries of MassMutual Internacional (Argentina) S.A.
MassMutual Services S.A., a corporation organized in the Argentine Republic
which operates as a service company. (MassMutual Internacional (Argentina) S.A.
- - 99%; MassMutual International, Inc. - 1%)
Direct Affiliate of MassMutual Internacional (Chile) S.A.
1. Mass Seguros de Vida S.A., a corporation organized in the Republic of
Chile which operates as a life insurance company. (MassMutual
Internacional (Chile) S.A. - 33.5%)
2. Origen Inversiones S.A., a corporation organized in the Republic of Chile
which operates as a holding company. (MassMutual Internacional (Chile)
S.A. - 33.5%)
Direct Subsidiary of Origen Inversiones S.A.
Compania de Seguros Vida Corp S.A., corporation organized in the Republic of
Chile which operates as an insurance company. (Origen Inversiones S.A. - 99%)
H. REGISTERED INVESTMENT COMPANY AFFILIATES
Each of the following entities is a registered investment company
sponsored by MassMutual or one of its affiliates.
1. DLB Fund Group, a Massachusetts business trust which operates as an
open-end investment company advised by David L. Babson and Company
Incorporated. MassMutual owns at least 25% of each series of shares issued
by the fund.
2. MML Series Investment Fund, a Massachusetts business trust which operates
as an open-end investment company. All shares issued by the trust are
owned by MassMutual and certain of its affiliates.
3. MassMutual Corporate Investors, a Massachusetts business trust which
operates as a closed-end investment company. MassMutual serves as
investment adviser to the trust.
4. MassMutual Institutional Funds, a Massachusetts business trust which
operates as an open-end investment company. All shares issued by the trust
are owned by MassMutual.
5. MassMutual Participation Investors, a Massachusetts business trust which
operates as a closed-end investment company. MassMutual serves as
investment adviser to the trust.
6. Oppenheimer Series Fund, Inc., a Maryland corporation which operates as an
open-end investment company. MassMutual and affiliates own a majority of
certain series of shares issued by the fund.
7. Panorama Series Fund, Inc., a Maryland corporation which operates as an
open-end investment company. All shares issued by the fund are owned by
MassMutual and certain affiliates.
ITEM 27. NUMBER OF CONTRACT OWNERS
As of March 4, 1999, the number of Contract Owners was 8,219.
ITEM 28. INDEMNIFICATION
The Bylaws of the Company provide that:
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The following provisions regarding the Indemnification of Directors and
Officers of the Registrant are applicable: CONNECTICUT LAW. Except where an
applicable insurance policy is procured, Connecticut General Statutes ("C.G.S.")
Section 33-320a is the sole source of indemnification rights for directors and
officers of Connecticut corporations and for persons who may be deemed to be
controlling persons by reason of their status as a shareholder, director,
officer, employee or agent of a Connecticut corporation. Under C.G.S. Section
33-320a, a corporation shall indemnify any director or officer who was or is a
party, or was threatened to be made a party, to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (hereinafter referred to as "proceeding") by virtue of the fact
that he or the person whose legal representative he is: (i) is or was a director
or officer of the corporation; (ii) while a director or an officer of the
corporation, is or was serving at the request of the corporation as a director,
officer, partner, trustee, employee or agent of another foreign or domestic
corporation, partnership, joint venture, trust or other enterprise (hereinafter
referred to as "enterprise"), other than an employee benefit plan or trust; or
(iii) while a director or an officer of the corporation, is or was a director or
officer serving at the request of the corporation as a fiduciary or an employee
benefit plan or trust maintained for the benefit of employees of the corporation
or any other enterprise, against "covered expenditures" if (and only if) his
conduct met the applicable statutory eligibility standard. The types of
expenditures which are covered and the statutory eligibility standard vary
according to the type of proceeding to which the director or officer is or was a
party or was threatened to be made a party.
According to C.G.S. Section 33-320a, in non-derivative proceedings other
than ones brought in connection with an alleged claim based upon the purchase or
sale by a director or officer of securities of the corporation or of another
enterprise, which the director or officer serves or served at the request of the
corporation, the corporation shall indemnify a director or officer against
judgments, fines, penalties, amounts paid in settlement and reasonable expenses,
including attorneys' fees, actually incurred by him in connection with the
proceeding, or any appeal therein, IF AND ONLY IF he acted (i) in good faith and
(ii) in a manner he reasonably believed to be in the best interests of the
corporation or, in the case of a person serving as a fiduciary of any employee
benefit plan or trust, in a manner he reasonably believed to be in the best
interests of the corporation or in the best interest of the participants and
beneficiaries of such employee benefit plan or trust and consistent with the
provisions of such employee benefit plan or trust. However, where the proceeding
brought is criminal in nature, C.G.S. Section 33-320a requires that the director
or officer must satisfy the additional condition that he had no reasonable cause
to believe that his conduct was unlawful in order to be indemnified. A director
or officer also will be entitled to indemnification as described above if (i) he
is successful on the merits in the defense of any non-derivative proceeding
brought against him or (ii) a court shall have determined that in view of all
the circumstances he is fairly and reasonably entitled to be indemnified. The
decision about whether the director or officer qualifies for indemnification
under C.G.S. Section 33-320a may be made (i) in writing by a majority of those
members of the board of directors who were not parties to the proceeding in
question, (ii) in writing by independent legal counsel selected by a consent in
writing signed by a majority of those directors who were not parties to the
proceeding, or (iii) by the shareholders of the corporation at a special or
annual meeting by an affirmative vote of at least a majority of the voting power
of shares not owned by parties to the proceeding. A director or officer also may
apply to a court of competent jurisdiction for indemnification even though he
previously applied to the board, independent legal counsel or the shareholders
and his application for indemnification was rejected.
For purposes of C.G.S. Section 33-320a, the termination of any proceeding
by judgment, order, settlement, conviction or upon a plea of nolo contendere or
its equivalent shall not create, of itself, a presumption that the director or
officer did not act in good faith or in a manner which that director or officer
did not believe reasonably to be in the best interests of the corporation or of
the participants and beneficiaries of an employee benefit plan or trust and
consistent with the provisions of such plan or trust. Likewise, the termination
of a criminal act or proceeding shall not create, of itself, a presumption that
the director or officer had reasonable cause to believe that his conduct was
unlawful.
In non-derivative proceedings based on the purchase or sale of securities
of the corporation or of another enterprise, which the director or officer
serves or served at the request of the corporation, C.G.S. Section 33-320a
provides that the corporation shall indemnify the director or officer only after
a court shall have determined upon application that, in view of all the
circumstances, the director or officer is fairly and reasonably entitled to be
12
<PAGE>
indemnified. Furthermore, the expenditures for which the director or officer
shall be indemnified shall be only such amount as the court determines to
appropriate.
Pursuant to C.G.S. Section 33-320a, where a director or officer was or is
a party or was threatened to be made a party to a derivative proceeding, the
corporation shall indemnify him against expenses, including attorneys' fees,
actually and reasonably incurred by him in connection with the proceeding or any
appeal therein, in relation to matters as to which he is finally adjudged not to
have breached his duty to the corporation. The corporation also shall indemnify
a director or officer where the court determines that, in view of all the
circumstances, such person is fairly and reasonably entitled to be indemnified;
however, in such a situation, the individual shall be indemnified only for such
amount as the court determines to be appropriate. Furthermore, the statute
provides that the corporation shall not indemnify a director or officer for
amounts paid to the corporation, to a plaintiff or to counsel for a plaintiff in
settling or otherwise disposing of a threatened or pending action, with or
without court approval, or for expenses incurred in defending a threatened
action or a pending action which is settled or otherwise disposed of without
court approval.
C.G.S. Section 33-320a also provides that expenses incurred in defending a
proceeding may be paid by the corporation in advance of the final disposition of
such proceeding upon authorization of the board of directors, provided said
expenses are indemnifiable under the statute and the director or officer agrees
to repay such amount if he is later found not entitled to indemnification by the
corporation.
Lastly, C.G.S. Section 33-320a is intended to be an exclusive statute. A
corporation established under Connecticut statute cannot indemnify a director or
officer (other than a director or officer who is or was serving at the request
of the corporation as a director, officer, partner, trustee, employee or agent
of another enterprise), to an extent either greater or less than that authorized
by the statute, and any provision in the certificate of incorporation, the
by-laws, a shareholder or director resolution, or agreement or otherwise that is
inconsistent with the statute is invalid. C.M. Life Insurance Company was not
established under Connecticut statue but was instead created by special act of
the Connecticut General Assembly. Currently, its charter does not have
provisions dealing with indemnification of its directors or officer, therefore
the provisions of C.G.S. Section 33-320a currently apply to such
indemnification. However, in the event C.M. Life Insurance Company's charter is
amended by the Connecticut General Assembly in such a manner which is
inconsistent with the statute, the charter would take precedence over C.G.S.
Section 33-320a. Notwithstanding the above, C.G.S. Section 33-320a specifically
authorizes a corporation to procure insurance providing greater indemnification
rights than those set out in the statute the premium cost of which may be shared
with the director or officer on such basis as may be agreed upon. The directors
and officers may be covered by an errors and omissions insurance policy or other
insurance policy. 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 that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
13
<PAGE>
Item 29. Principal Underwriters
(a) MML Distributors, LLC, a controlled subsidiary of MassMutual, acts
as principal underwriter for registered separate accounts of
MassMutual, C.M. Life and MML Bay State.
(b)(1) MML Distributors, LLC, is the principal underwriter for the
contracts. The following people are officers and member
representatives of the principal underwritier.
OFFICERS AND MEMBER REPRESENTATIVES
MML DISTRIBUTORS, LLC
Kenneth M. Rickson Member Representative One Monarch Place
G.R. Phelps & Co., Inc. 1414 Main Street
Springfield, MA 01144-1013
Margaret Sperry Member Representative 1295 State Street
Massachusetts Mutual Springfield, MA 01111-0001
Life Insurance Co.
Kenneth M. Rickson Chief Executive Officer, One Monarch Place
President, and Main OSJ 1414 Main Street
Supervisor Springfield, MA 01144-1013
John E. Forrest Vice President One Monarch Place
1414 Main Street
Springfield, MA 01144-1013
Michael L. Kerley Vice President One Monarch Place
Assistant Secretary 1414 Main Street
Springfield, MA 01144-1013
Ronald E. Thomson Vice President One Monarch Place
1414 Main Street
Springfield, MA 01144-1013
James T. Bagley Treasurer 1295 State Street
Springfield, MA 01111
Bruce C. Frisbie Assistant Treasurer 1295 State Street
Springfield, MA 01111-0001
Raymond W. Anderson Assistant Treasurer 140 Garden Street
Hartford, CT 06154
Ann F. Lomeli Secretary 1295 State Street
Springfield, MA 01111-0001
Marilyn A. Sponzo Chief Legal Officer One Monarch Place
Assistant Secretary 1414 Main Street
Springfield, MA 01144-1013
Robert Rosenthal Compliance Officer One Monarch Place
1414 Main Street
Springfield, MA 01144-1013
Melissa Thompson Registration Manager One Monarch Place
1414 Main Street
Springfield, MA 01144-1013
14
<PAGE>
Ruth B. Howe Director of Continuing One Monarch Place
Education 1414 Main Street
Springfield, MA 01144-1013
Peter D. Cuozzo Variable Life Supervisor and 140 Garden Street
Hartford OSJ Supervisor Hartford, CT 06154
Anne Melissa Dowling Large Corporate Markets 140 Garden Street
Supervisor Hartford, CT 06154
(b)(2) MML Investors Services, Inc. is the co-underwriter of the
contracts. The following people are the officers and directors of
the co-underwriter.
MML INVESTORS SERVICES, INC.
OFFICERS AND DIRECTORS
<TABLE>
<CAPTION>
OFFICER BUSINESS ADDRESS
- ------- ----------------
<S> <C>
Kenneth M. Rickson One Monarch Place
President 1414 Main Street
Springfield, MA 01144-1013
Michael L. Kerley One Monarch Place
Vice President, Chief Legal Officer, 1414 Main Street
Chief Compliance Officer, Assistant Secretary Springfield, MA 01144-1013
Ronald E. Thomson One Monarch Place
Vice President, Treasurer 1414 Main Street
Springfield, MA 01144-1013
Ann F. Lomeli 1295 State Street
Secretary/Clerk Springfield, MA 01111
John E. Forrest One Monarch Place
Vice President 1414 Main Street
National Sales Director Springfield, MA 01144-1013
Marilyn A. Sponzo One Monarch Place
Assistant Secretary 1414 Main Street
Springfield, MA 01144-1013
James Furlong One Monarch Place
Chief Operations Officer 1414 Main Street
Springfield, MA 01144-1013
James T. Bagley One Monarch Place
Controller 1414 Main Street
Springfield, MA 01144-1013
David Deonarine One Monarch Place
Sr. Registered Options Principal 1414 Main Street
Compliance Registered Options Principal Springfield, MA 01144-1013
Nicholas J. Orphan 245 Peach Tree Center Ave., Suite 2330
Regional Supervisor (South) Atlanta, GA 30303
Robert W. Kumming 1295 State Street
Retirement Services Regional Springfield, MA 01111
Supervisor (East/Central)
Peter J. Zummo 1295 State Street
Retirement Services Regional Supervisor(South/West) Springfield, MA 01111
Bruce Lukowiak 6263 North Scottsdale Rd., Suite 222
</TABLE>
15
<PAGE>
<TABLE>
<S> <C>
Regional Supervisor (West) Scottsdale, AZ 85250
Gary L. Greenfield 1 Lincoln Center, Suite 1490
Regional Supervisor (Central) Oakbrook Terrace, IL 60181
Burvin E. Pugh, Jr. 1295 State Street
Chief Agency Field Force Supervisor Springfield, MA 01111
John P. McCloskey 1295 State Street
Regional Supervisor (East) Springfield, MA 01144
Robert J. O'Connell 1295 State Street
Chairman of the Board of Directors Springfield, MA 01144
Susan Alfano 1295 State Street
Director Springfield, MA 01111
Lawrence V. Burkett, Jr. 1295 State Street
Director Springfield, MA 01111
John B. Davies 1295 State Street
Director Springfield, MA 01111
Anne Melissa Dowling 140 Garden Street
Director Hartford, CT 01654
Gary T. Huffman 1295 State Street
Director Springfield, MA 01111
Douglas J. Jangraw 140 Garden Street
Director Hartford, CT 01654
Burvin E. Pugh, Jr. 1295 State Street
Director Springfield, MA 01111
</TABLE>
(c) See the section captioned "Distribution" in the Statement of
Additional Information.
16
<PAGE>
ITEM 30. LOCATION OF ACCOUNTS AND RECORDS
All accounts, books, or other documents required to be maintained by Section
31(a) of the Investment Company Act of 1940 and the rules promulgated thereunder
are maintained by the Registrant through C.M. Life Insurance Company, 140 Garden
Street, Hartford CT.
ITEM 31. MANAGEMENT SERVICES
Not Applicable.
ITEM 32. UNDERTAKINGS
a. Registrant hereby undertakes to file a post-effective amendment to this
registration statement as frequently as is necessary to ensure that the
audited financial statements in the registration statement are never more
than sixteen (16) months old for so long as payment under the variable
annuity contracts may be accepted.
b. Registrant hereby undertakes to include either (1) as part of any
application to purchase a contract offered by the Prospectus, a space that
an applicant can check to request a Statement of Additional Information,
or (2) a postcard or similar written communication affixed to or included
in the Prospectus that the applicant can remove to send for a Statement of
Additional Information.
c. Registrant hereby undertakes to deliver any Statement of Additional
Information and any financial statement required to be made available
under this Form promptly upon written or oral request.
d. C.M. Life Insurance Company hereby represents that the fees and charges
deducted under the individual deferred variable annuity contracts with
flexible purchase payments described in this Registration Statement in the
aggregate, are reasonable in relation to the services rendered, the
expenses expected to be incurred, and the risks assumed by C.M. Life
Insurance Company.
17
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant, C.M.
Multi-Account A, certifies that it meets all of the requirement for
effectiveness of this Post-Effective Amendment No. 8 pursuant to Rule 485(b)
under the Securities Act of 1933 and has caused this Post-Effective Amendment
No. 8 to Registration Statement No. 33-61679 to be signed on its behalf by the
undersigned thereunto duly authorized, all in the city of Springfield and the
Commonwealth of Massachusetts, on the 22nd day of April, 1999.
C.M. MULTI-ACCOUNT A
C.M. LIFE INSURANCE COMPANY
(Depositor)
By: /s/ Lawrence V. Burkett, Jr.*
--------------------------------
Lawrence V. Burkett, Jr., Director, President and Chief
Executive Officer C.M. Life Insurance Company
/s/ Richard M. Howe On April 22, 1999, as Attorney-in-Fact
- ---------------------- pursuant to powers of attorney.
*Richard M. Howe
As required by the Securities Act of 1933, this Post-Effective Amendment
No. 8 to Registration Statement No. 33-61679 has been signed by the following
persons in the capacities and on the dates indicated.
Signature Title Date
- --------- ----- ----
/s/ Laurence V. Burkett, Jr. Director, President and Chief April 22, 1999
- -------------------------- Executive Officer
Laurence V. Burkett, Jr.
/s/ Edward M. Kline Vice President and Treasurer April 22, 1999
- -------------------------- (Principal Financial Officer
Edward M. Kline
/s/ John M. Miller Jr. Vice President and Comptroller April 22, 1999
- -------------------------- (Principal Accounting Officer)
John M. Miller Jr.
/s/ John B. Davies Director April 22, 1999
- --------------------------
John B. Davies
/s/ Stuart H. Reese Director April 22, 1999
- --------------------------
Stuart H. Reese.
/s/ Isadore Jermyn Director April 22, 1999
- --------------------------
Isadore Jermyn
/s/ James Miller Director April 22, 1999
- --------------------------
James Miller
/s/ Robert J. O'Connell Director April 22, 1999
- --------------------------
Robert J. O'Connell
/s/ Richard M. Howe On April 22, 1999, as
- -------------------------- Attorney-in-Fact Pursuant to
*Richard M. Howe powers of Attorney.
18
<PAGE>
REPRESENTATION BY REGISTRANT'S COUNSEL
As counsel to the Registrant, I, James M. Rodolakis, have reviewed this
Post-Effective Amendment No. 8 to Registration Statement No. 33-61679, and
represent, pursuant to the requirement of paragraph (e) of Rule 485 under the
Securities Act of 1933, that this Amendment does not contain disclosures which
would render it ineligible to become effective pursuant to paragraph (b) of said
Rule 485.
/s/ James M. Rodolakis
- ------------------------
James M. Rodolakis
Counsel
C.M. Life Insurance Company
19
<PAGE>
EXHIBIT INDEX
9 Opinion of and Consent of Counsel.
10(i) Consent of Independent Accountants, PricewaterhouseCoopers LLP.
20
<PAGE>
EXHIBIT 9
Opinion of and Consent of Counsel
April, 1999
C.M. Life Insurance Company
140 Garden Street
Hartford, CT 06154
Re: Post-Effective Amendment No. 8 to Registration Statement
No. 33-61679 filed on Form N-4
Ladies and Gentlemen:
This opinion is furnished in connection with the filing of Post-Effective
Amendment No. 8 to Registration Statement No. 33-61679 on Form N-4 under the
Securities Act of 1933 for C.M. Life Insurance Company's ("CM Life") flexible
premium variable annuity contract (the "Contract"). C.M. Multi-Account A issues
the Contract.
As an attorney for CM Life, I provide legal advice to CM Life in connection with
the operation of its variable products. In such role I am familiar with the
Post-Effective Amendment for the Contract. In so acting, I have made such
examination of the law and examined such records and documents as in my judgment
are necessary or appropriate to enable me to render the opinion expressed below.
I am of the following opinion:
1. CM Life is a valid and subsisting corporation, organized and operated under
the laws of the state of Connecticut and is subject to regulation by the
Connecticut Commissioner of Insurance.
2. C.M. Multi-Account A is a separate account validly established and maintained
by CM Life in accordance with Connecticut law.
3. All of the prescribed corporate procedures for the issuance of the Contract
have been followed, and all applicable state laws have been complied with.
I hereby consent to the use of this opinion as an exhibit to this Post-Effective
Amendment.
Very truly yours,
/s/ James M. Rodolakis
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James M. Rodolakis
Counsel
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Exhibit 10(i)
CONSENT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors of
C.M. Life Insurance Company
We consent to the inclusion in this Post-Effective Amendment No. 8 to the
Registration Statement of C.M. Multi-Account A (Panorama Premier segment) on
Form N-4 (Registration No. 33-61679), of our report dated February 25, 1999, on
our audits of C.M. Multi-Account A (Panorama Premier segment) and of our report
dated February 25, 1999, on our audits of the statutory financial statements of
C.M. Life Insurance Company, which includes explanatory paragraphs relating to
the use of statutory accounting practices, which differ from generally accepted
accounting principles. We also consent to the reference to our Firm under the
caption "Experts" in the Statement of Additional Information.
PricewaterhouseCoopers LLP
Springfield, Massachusetts
April 27, 1999
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