HomeMy WebLinkAbout95-03590
1
<l~
~
d
.-
d
?
i
-j
,.;b.
\1
~
II
:~
'"
J
rJ
,-r
~i
. ~2
/
,
/
!
~ :
J
o
0-
~
WAYNE R. STOLTZFUS, . IN THB COURT OF COMMON PLBAS OF
Plaintiff . CUMBBRLAND COUNTY, PBNNSYLVANIA
.
V I CIVIL ACTION - LAW
.
.
VARIABLB ANNUITY LIFB INS. CO.. NO. 95-3590 CIVIL TBRM
Defendant .
.
IN REI VACATE ARBITRATOR
ORDBR OF COURT
AND NOW, JANUARY 19, 1996, the appointment of David
Raho, Esquire is hereby vacated and Jacqueline Verney, Bsquire,
is appointed in his stead.
By the Court,
'''oaniel Deardorff, Esquire
Clwlirmsn
Jacqueline Verney, Esquire
Court Administrator
IBId
)~ ..
LM"'U_S'~
,.t/W 4-(~' 11~
k~~
lie..,
0-
,'O,
~,
\
,
I
,
l
i
I
,
i
!
,
[
i
I
i
\
I
I
I
..
nl:Cl1iVED
',- HJ - j"'9~'
',. . I" 0
_._, - , I
<, 1ii~" (- ;
I' '1ILl!'>'IIA I AIIlI'MI~I~.AltII P~\lSIII
t'rnlt,1 UJl~'t~ll1\t1AM
h\\\t.l UII\\H\nl\U1JI'~1
WAYNE It STOLTZFUS,
Plaintifr
IN mE COURT OF COMMON I'LEAS OF
CUMBERLAND COUNTY.I)ENNSYLVANIA
vs.
NO, 95.3590 - CIVIL 1995
VARIABLE ANNUITY LIFE
INSURANCE COMPANY,
Dcfendant
TO: Mr. Waync R, Stoltzfus
32 Teaberry Drive
Carlisle, PA 17013
(Cert,Mail- RRR)
Bradford Dorrance, Esquire
KEEFER, WOOD, ALLEN & RAHAL
210 Walnut Street
p, 0, Box 11963
Harrisburg. P A 17108-1963
NOTICE OF MEETING OF ARBITRATORS
PLEASE TAKE NOTICE that the Arbitrators appointcd in the above captioned action will
sit for the purpose of their appointment on Thursday, March 7, 1996, beginning at 2:00 p,m, in the
second floor hearing room of the old Cumberland County Courthouse, Carlisle. Pennsylvania,
Date: January 25, 1996
W K Q~M~
Daniel K, Deardorff, Esquire. Chairman
Jacqueline Verney, Esquire
Johnna Deily, Esquire
cc: Cumberland County Commissioner's OOlce
Cumberland County Courthouse
Carlisle, PA 17013
P.S, Any attorney for whom this dale and time arc not satisfactory will be expected to In
turn arrange a date and time suitable for all.
.
.
'1,'lb.1 111l'l\IN III '" .\\1
111\\",1 11U"\IWIlI'AU
\V A YNE It STOLTZFUS,
Plaintitl.
IN TIlE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, I)ENNSYL VANIA
vs
NO, 95.3590. CIVIL 1995
VARIABLE ANNUITY LIFE
INSURANCE COMPANY,
Defendant
TO: Mr, Wayne R, Stoltztus
32 Teaberry Drive
Carlisle. P A 17013
(Cen,Mail. RRR)
Bradford Dorrance, Esquire
KEEFER, WOOD, ALLEN & RAHAL
210 Walnut Street
1),0, Box 11963
Harrisburg, P A 17108-1963
NOTICE OF MEETING OF ARBITRATORS
PLEASE TAKE NOTICE that the Arbitrators appointed in the above captioned action will
sit tor the purpose of their appointment on Thursday. March 7, 1996. beginning at 2:00 p,m, In the
second noor hearing room of the old Cumberland COllnty Courthouse, Carlisle, Pennsylvania,
Date: December 21. 1996
~K.0~
Daniel K. Deardorlf. Esquire. Chairman
David Raho, Esquire
Johnna Deily, Esquire
cc: Cumberland County Commissioner's Ollicc
Cumberland County Courthouse
Carlisle, P A 17013
P,S, Any attorney for whom this date and time are not satislactory will be expected to In
turn arrange a date and time suitable for all,
.. ~'j/\ Ijl.r 3\.,
.
..4 1I111;olpt lot
,,,If ~,~~tl,~~.?,~ ~:~i,I"" ,,,,,,,,.,1
---
,it~l;.a'I;li 11" t'l.i '1'..' 1,., !"I, "';l\'IHI,l! Muil
l~)lll! II t, ~ ,'I ~l"
fi J~i. ~,{iJi (~lli
I ;r.'f" /.1 'v' V- "Sf.
~t~i'l1l-;3i~,:-~:';-
sl.1_M~~'___H'_ __'__
III ~-------"___~_, ,$~~ .5..2
! '=-~-,---L_LrL.
K'
..
'"
----_._~-._--_. -----
,..
----
u,_.,. 'i" ','
1,.. 't.' ,., '" ,','
,Ie.)
l.}'.- .,',1;,-11., ,',,,"
l'fL,"'!',_, .'.' , ;'.
""(,:1 "II'
, h"
,
fI"~!il'cl't 'I:"
j.
Z 39/\ 41,j> 31...
2. ,~,~~~~,!!?I,(~'~~~I""" I'"" "',,,j
.."llt>J~n Do llol U~l~ "ll fllll'll1(1J;orliJl MUll
~5jll! H~I.'I.t~t!
)1 ~i,~{,:"~:2;i,k~&
. 1?1/!I,_~,ig'l__~_&,.S-o;
I ~-~ .,.-.,__ "'" ...., J,iL
B ~~~:_~. '. j_l~
l "H',' r.... ,'"
le ------.__'n_,__._
Jil""'-"'-.If.., ',;", l."
..------- ---.-----
li""""!I!"_,!!"",,,,"q U'
-~ ,~,...~._L" !.'.,'
hi ~\t ,,' ~ '_~'~~~__ ,~_ _ _.__~. ,
1\1"1",,,1;",111\'..,,,, J'
1-,,,,, '!".,I/'H', "(', "I!,
li;\", h..,;..".
",n
,
"','~ll"d'; " , ';,Ii
,)'~j-
7
I 6
,..#.
~-. ...
"
NOTICE OF APPEAL
COMMONWrAllHIJll'rNN5YIVAN'A
C()IJl11 (JI CUMM()N filL Mi
IIIIlM
JIJlllCIAllllSIIlICT
DISTHICT .IUSTICE JUDGMENT
COMMON l'lLAS Nu
~1!j-3'j'J() civil. Term
NOTICE OF APPEAL
NUllel' 1\ QIIlI'11 Ih,ll 11ll! iIPPt~Il\ltlt h.l~ Ilh!t1111 Ilw illlllVI! Cllllll 01 CUllIltIlllIl'II',I'i 1111 .\l'pI..II 1111111 IIII' jtltlqtlWlIt 1I'llIh~lI~d hy lIw DI\t1lt:l JmllCI!
on tlw d.lll' .llld !II lllP r,ISllllWlltllllllld IIduW.
Voll'i"lJlI' 1In1I111Ly 1,11... lllll. Cu.
iUiitiii--o' ""....,,-."..,-------- ---. "-'-'-"-
l j"t ~ -
J.l;;~:;'- ~;5.' .;;: ":;~--l\l,-I~~----
auU ,IP C:OPI
ii~Mi: Df ."ILL"'''
~9~9 i\J,h;Jl
l'oIrk\1oJ/r, , '
\'''' 'HI CAS' 0' ,.
:.llo1LzlUD, \~aiIW H.
.. ----.,-.-------.-- -~-".-"--------_._-_.__._...,.
llc,uulu.\,
111^
'/"12,53
iiAii- 0, IUPUMli.t't
tll\ln.<
,m<1<I't C:V-OOOO 1 '/3-95
'.' Vilriablc jlllJ\uity Ll tu Ilia. Co.
.".0.'..... "';''''iii-~.1.';;'-;-o~-,.,~
..Q:.. '-
,_~l'lld~~U. ~,ul:'J:L11.'.ll'J,_Eo.'i~ro __"_.__"
IS 1t!lIl1ln:d tII11lel Pd,
6/;!.O/Y':J
--"
r:~"'IM NO.
1 111\ hlorh, will 1m si\Jlwd ONLY wlwl1 thiS nntiltllJlI
II,CI',J P N" 100811
11m NoIICl! ul AI'p!!,II, wlwll Il~CI~IVI~d by lht! Distill:! Jm\in, will Opt'lilh! ilS
.1 SUPlnsEDtAS Itlllh' jUdurlllJllllol pm\eS!lltJll11\ 1111" t:;I\l',
/I afll",l/a'"
W,lS Claimant (Ulll Pll.
J/,CPJP,
No. 1001(6) in 11c:ticJI! ImfrJt'(! Disrnc:t Justiell. lit!
MUST FILE A COMPLAINT lVirhill rlVellry (201
daYId("" /l/IIIY hi. NOTICE ,,( APPEAL
SOl/II~ltllfl' "I P",f/ltll'llf,11V (If Ol.'"uty
- - ~._._-.-_~-'_. -~------------~.
PRAECIPE TO ENTER RULE TO FILE COMPLAINT AND RULE TO FILE
!TIllS "'1/11)/1 "((",,,, W tIC IIsed ONL y wlIt'1I aOlwl/.1l1r lVas /JEFfNOANTlsefll'" J/,CPJP, No, /00/(71 ill iJ('riOIlI'fI(llIe Disl,icl JI/$//ce,
IF NO T USEO, ,,,..tac" fro". nJ/JV ul notice of ilPlJtliJl to be St'rvIlcllllWtl "I':mIlL'L').
PRAECIPE: T" I'Illlh,lllfll ill V
Elllel lull! upon
Wayno U. 6tult~[uo
N.",w III JI'/It.'/lI!ldsl
, IIPPlJllt'l!(sX tn flit! a complaint in thi!. illlIW,,1
(COlllllllJll Ptl'i1!. No, _----.2_~____1~_29~ J;~y.il Turm I wlthilllWI!l\ty (201 days aftel selVlce 01 Hilt! (II sutlm 1!lltlV nl jwlUl1l1'l\1 nlnoll pillS,
SIYIMwre vi d/JpvIJa,,' 0' 'Iii .lftom,... VI JfrJf!l1r
Uradlord UorrAnco
,_.___._._.,_.__________.ilPI'"lh!l!ll'l2IO \"1I1nut. "t., P. O. Box 1'1963
Namt' v, U/J/U!lIm,'hJ '1 D
Uarrlol1urg, PA l7108-1963
, (717) l55-8Ul4
III You illt! rllJllfll!d that a lulo i$ hell!hy 1!I1lelml upun yml In We a cUl11lJlaint ll\ tlm apppal within IWLll1ty 120) days iltlt!! the d.llt' of
selVICtl of llu!. lUll! 1111011 YUlI hy IHltSlJllitl !ItllV1CU 1JI hy t:l!ltifit!t1 or Il!uistt!Il!lI Illilll.
RULE:
TOl_WaYJ1U II. St.olt.l\f.u8
121 II VIII' dOl II"II,h, ilw"'llla",' wilhillll"II,,"", a JUllGMENT OF NON "lIDS WILl,IlE ENTEIlEO AGAINST YOU,
131 TIll' ddll' "IIIlI"cllullh" ,"l. illlll'I[1l wal hV ",a,1 iltho ,lalO III ",,,11I1U, J' 4~, ,"" i:' ,
Oalo:__~IJly--,~.J_, lL2.~ ---.: ~JJ-. ~~ ,.jlt~-
S'U'IJ''''(j P,llIlw,IOWY , (" "'V
"oIlf, I i III
.. ,
!'tlOOr OF SI,RVIGL or NOTte!: OF APPEAL AND HUlE TO FILE COMPLAINT
{1 Ii" l' "Il' ,.1 ~',"i ;,1' ,ifl1,'; r n. I Ii 1 n n'l rlii;'\.} J IVI r!,J nt\ ~'s ..If rell hl;II'! rh. /If/h t, 1;( ,jjlfiV,J,' ('ill'! I, ,iil)lhl-.lhtt.' ('/jq'i!
(OMfl.111MVI AI 11101 I'l NNS'd VI\I'iI/'
fOIlNT)' ul
!;UMlI~RJ,ANI) .
...~..~,...~.~",_,_, _...- "'0
AFFlDAVll
,dl"ll. 111 It I'; '\-1 d
Ili.',l!, ! I'
x
! I "II, II j III t N ~"i
I'/,III'(I{"'IIIII,J
'II' ill Apfll'n1 1~IHII1HI!l1 pj".L
July' I'i 9S
95-3590 Civil Term
Nu " HllIl'l Ii\!' ll'''l'il_l Jll~tir~" flji;,qpi.;ll'd ,Ill-"'" ,11'
f i !If PH'':!:I.JI -,1-'\,,1 ,. !Xt h',- jl !!!dd'dt i!f'Il\~lI,,,'dllllil". <,!'!lI!!",'"
Wayne R. Stoltzfus ,'"
[Xi I" (, il!"I'!,'! I, ,li!ji;1i,~I!ldt'I':,1I'I_H1/1tillldt,;hl:dhtltl\l.
,'(!'pl"l1.Q];"jil,
July 5
"';l ,"HlliP!) :1/,.
1" 95
pp-) .-,- ''1.1''-'"
I",'jl ,I'
.X
.;lHl !tillh, I 1l1'{ 1'>'.'1\0\-,1 llh' lild, !,; I,', 1 I
July 5
<I1'j',;"! ,i'! ;'-:1'111') Ill! !Ill' "lli'p' N~J1i!" ,d ^PllPtl1 i/pllll lIlt, '1I'p,:l!I'rhl II'
11) 95 \! b', 1""CI".\1 'ii','\" i X hy (jl'ltdlt'I!lIH-'l",I'-I,'dJ
iqdll 111>' lit;!;
",1', ,,'!;!"
'1"11
11\,.11, ','ill"l ';. !i P:ijll ,ill.ll h._Ii 1\111'111
~;\'!'"HJ ~l(H~'1I1l1 MJI,I :,,111:,',1111<111 ill I,' IIi! t,!J,.
IIIIS 5' Il/i'1I1I J\J..ty , "I'f~
,..~~~k~~
11, ,.", 3 ( r 1'1 '1'1
~
~ ,. .---
-""1';,1111'" I!~ ,;tt....'1I
~, -ofl...:tT /
Brndfor~r~c~
Attorney for Appellsnt
t__._
l,"
."
~
,
.J
,I
1'-
t,
It.
.0
;.J:
NOTARIAl. SEAL
MNlJOAlE L, JOHNSON, NoWy PubI",
ClII' of HanIIlug, OItJphln Countv
00r1.1~' r
,-,
.
"
""~'I
~ .
.,
.
t1i\
~!~,~.
lf~
~ ~~
, ~~
~ ,~CI, /70:3
Rf': ,JM1or-: IJ V~ ~ 4- ~
v. ~ a,..J ~ MAl 9S- 35'70 {k;t ~~
S~'.
i?~ ~ ~
~ IN ~
~ -r 11...- if.,
dA~~
~ ~;J- ;k ~,
rkrm~
J m~ V~
.A"'~'~
o-n1~~
~U'
./ . ,-; ',"
~ ~~ {)~
~
f?c.\ 170 13
Ii, ( ~. ~ , ,I '.j' "
,
,
,
I f..d' }" " k"rr ('"
{ I' j i\ ,\.,'. ,-I.
/1. ,. I": II <,
,
I. I 'lllt~' (',
.. I' 1 .
,. L' ) ,. i.l ' t.. (.:)
I J
cc: (3. j)~
llP~.....:..."!-I'I<'<'''':-~''''''
>. ~..-_.
... -- \ .
, .'
l'."
f r-[-",""-i
"'+,. (~I'l/C:f_
bt(,', .' ()
( ,~
J!h '/~j
.. ~-'!,~()
J
, :. .
.. . Compll'l i,.mt I ,ndlol , 101 Iddlllon,t '''vi!;..
I, Compl'l. l1.nl1 J, 'fld 4. .. b j
· Print ~OUI nlm' '.nd. ,dd,u. on Ih, IIn'" 0111111 'aIm 10 thaI Wt un .
"lurn IhI, CI.d 10 you
. AUleh thi, 101m to lh, honl ollh, m,llpI,u, 01 on 'M b.ck II ,ple. 0 Addr....... Add,...
~.OOI~I.. J
' . Writ'''''tIUrnR.c.iptRtQutll.d''onthlmlltpi.ubelowthu,tlc:ltnumbtr 2. 0 RI.trlcted O,UVIfV
. fll. R'lutn RKtlpl will .how to whom the .rllcl. w.. dlli"'''".nd thl dll.
S dlllv,,,d. Conlult ostml.ter for ,".
, J 3. Arllelo Addro..od to: 40. Atllelo Number
Hr. Wayne II. Stoltzfus l' 734 294 931 J'
32 Teaberry Drive 41- SlIvleo TVpo
Carlisle, I'A 17013 [j noglllllod Olnlurod
III COItlllod 0 coo I.
o hpro.. Moll l1! Rolum Roeolpt'ot 1
7. DOlo 0' OollvllV J!
- ~r- ~!
B. Add........ Addro.. (Onlv II roquOltod 1
.nd ,.. I. paid) ~
,",.1. ClPO: 1__.1-111 nnllO:OT'I' RETURN RECEIPT
6.
P 731j 294 'l3~
~ . ~~~~,~~,i~~~",~,~il",~,~~~~i~l,
~("'I,HI.".r,j
..... ,. ,
~1t'. lIaYIIl' R. ~ll"llfIlH
...1';' !;
J2 Tl'ahl'rry Dr IVl'
"'\1 -,<.;".4
CllrllHIL', I'A
1701]
$
-'
1',~I~'.Jl'
{",,,'.hd't>.;
S.'''',lli (!,'ht'., IH'
I~~\l"t. tl"ll}"h"'~ l"t'
Ill'l'll1,Il..n'I'I~d"~'''y
11UV.!""'1411~!"(l"j.ndl,,j
~
~
,
H\'Ilollll n"d:!<ptl,';/WII"IQ I" \....",'"
0"\.." "'M'l'A. ,.,10.,j"u"l
10lAl "1""'1('
8.h..,
III
]
:r
$.,
.
"
'.
c"
I\1"RI;t'\ Vi {Jail'
ll/21/1J5
t
UNmo ITATlI POITAL IEAVlCE
1/1/11'''
~
-
'I', M^"
0"1011I IUllna..
PENALTY FOR PRIVATE
USE TO AVOIO PAVMENT
Of POSTAOE. I30D
Print your nama, addreu end ZIP Code hara
· Daniel K. Deardorff, Eequire .
HARTSON, DEARDORFF, WILLIAMS & OTTO
10 East High Street
Carliele, PA 17013
.
~..,,;.-'''''',..,.._.
(4110."'11) 0661 ounr 'OOOt 'moJ Sd
'.._".'''>-'~.W~.''.'_"",",_
I If : ii' , i .
r& I i 1:1 ! ; j
I ~ ~S ,~~ g j~ ~
s. ~f ~t. ~~M ~ ~j ~
If ~~ '~~SG H &~
Ie a~ i~ t~w ~t I~
aM I~ :1 iIi, ~i Ii f
',:!i II !I!! i! ;1 I
I '~H J~ i~:j ~I I: t
,: II! ,; liif !, rf :
i,. IIi II Ilill: f~ I
(r~ fl' i! '. -~f~ I,M r
: a l:~' 1~~t1 .. f~ lit
t <I, ~ '"
.
.
f
I
,
. . .'
!
'.....
Woyno R. StoltzfuD,
Plo1ntlff
11 N TItE COURT OF COMMON PLEAS OF
:CUMBERLAND COUNTY, PENNSYLVANIA
vo
IND. 9u-3u90
I
I
I
I
CIVIL HISS
Variablo Annuity Lifa
Inauranca Company,
Dafandant
RULE 1312-1 Tha Pat1t1cn for Appointment of Arbitrators
shall bo substantially in tha fo11owin~ forml
PETITION FOR APPOINTMENT OF ARBITRATORS
TO THE HONORABLE, THE JUDGES OF SAID COURTI
Wayna R. StoltzfuB, Plaintiff in the above action,
respectfully repreaents thatl
1. Tha abova-capt1onad action Is et Issue.
2. The olaim of the plaintiff in tha action ia
$3,134.99. The countarclaim of the dafandant
in the action ia -0-.
The following attorneya ara Intereated In tha casa aa
counael or era otharwiae diaqualified to ait sa arbitratcral
Attornays at Keefer, Wood, Allen and Rsha1, Harriaburg, PA.
WHEREFORE, your patitioner praya your Honorable Court to
appoint thrae (3) arbitratora to whom the casa ahsll ba
submitted.
Reapectfu11y Subm1ttad,
Wa~~- k ..jJ4'l1I-
Wayna R. Stoltzfua, Plalnt1ff
ORDER OF COURT
AND NowllJFCJ..r'r~'~B!2i, In conaiderat1on of tha
foregoing petition, l)jJ..I:f,j~.L.J./)If)/(jbd~. 1_..oLl v/cl MhrJ)
Eaq., andJ:1AI}/)[L,,/)t,IV , Eaq" ara appo1ntad
arbitratora in the above-capt1onod action aa prayad for.
::}r;::lL-~{ ./
P.J.
,
'; -: ~ ~
I'
, 1;
"v,
ie
"i .1
-':I:.
'eel
J~_
7Jh~e-V1. Iff"
:J:~
i .J' ~ ~,(t' ~Lv-''''b'
If td. (i, I'/.
:j-
.,
, -,~
~\" A~
~\<;- ('..
o I,'
~
\
I
!
!
Vllrificllticn
(lJ.J I VI t9f(
I hllt"lIby stlltll IInd cllt"tiFy thll Fcllcwingl
1. I sm thll plBintlFF in this mllttllr.
2. Thll Fllcts in this dccumllnt arll trulI and ccrt"lIct.
3. I undllrstBnd thBt FBlslI stBtBmllntB Brll SUbJBCt tc
pllnBl tillB.
,.,"~ "~t~"M {--
~J. ),,, II t t'if
(I ~ , (( . /...: It!.
A~ ... ,L(.
17,"3
, ...--
, ..."".:,~ - - ~-_.-.--
-:"\1.
,
~ .
1
~
~
iJ1 ;"1
.t,~f..;
r'T~
tf?"c
u~t,'-
1.",
.)l''''.
't'i'/
,,~(l
I.. ~.
f ~
:~
I!'
IiI
,:1
pl
."1
n
n
.1
'.'J
':l\I'~iJ
'~
,
,"I"r
, r
j -~ r
",-.1
..:I
hI
'<1\
....
tli
~.,
_J
~?
I,)
.Ir"
O.rtiflclte cf s.rvlce
(J2~j I y/ /'(9 (
I certify that I heve cn thie dey .ervad a copy of this
document upcn tha peraon(s) and in tha mannar indioltad
bel cw ,
First cle.. mel1 f postage pre-ps1d addressed tOI
VALlO
2S29 Allen Parkwey
Hcueton. TX 77019
'.'n~~t=,~~f
.~
-.... ~ ..........-, . ...~. ..- "
;
,
j
I
I
I
, ~
...,
'.,'
~t~
.t..
110,
"'I
.
'\i'
~
l'.l
tA
~
~
.:..0;
~
..
....
'"
i}
.;
,
StoltzFus, Wayne R.
P1n1nt1fF
va
Variable Annuity Life
Innurance Company
Defendant
In the Cumberland
County Court of
Common P1aaa
No. 85-358D Civil Term
l' ~'~"11111:(U:~j "l-
i. The Plaintiff In an adult residing at ~~D4 Bprlng Run
Dr i ve, Mechan1 caburu, Cumber land County, PA, 17D55.
2. Defendant Is a company with It's home oFFice et ~B28
Allen Parkway, Houston, TX, 77D18. Defandant Is licensed to
conduct buainesa in the Commonweelth of Pennay1van1a and
conducts such business throughout the Commonwaalth and in
Cumberland County, PA. DeFendant mainteins e bus1neaa
ofF lce at 1767 Sentry Parkway ~ Weat, Blue Bell, PA, 18422.
3. DeFendant entered into a contract with P1eintiFf to
provlde and maintain e Supplemental Retirement Account with
certain apeciFied tdrms end cond1t1ona.
4. The Defendant iSBued a prospactus that, in addition to
tha contract with PlaintiFf, speciFies rules and conditions
concerning said account.
5. Plaintiff prasentad a request to the DeFendant to
transfer all of tha Funds in the eccount to Defendant'a
competitor.
S. Pleintiff complied with all of the oond1t1onB of the
contrect and of tha prospectus concarning the requeated
transfer.
7. DeFandant fa11ad and reFused to ect upon the raquest to
trensFer Funds within the required time period es specified
in the contract and the prospectus.
B. During the period of time thet the Defendant reFuaed to
releaae Plaintiff's funds, the Investment ohosen by the
PlaintiFf increaaad in cost by $3,134.88.
8. Plaintiff requested that Defendant reimburse this 10BB.
DeFandant has reFused this request.
1D. Therefore, PlaintifF eskB that the court order the
Defendant to pay to the Plaintiff's account $3,134.88 p1ua
any subaequent ecoumu1ated Increase In the Investment'.
value, plus the ooats of these and ell prior proceedings.
Fb'j ; ltf f1/-
Wayne R. StoltzFus
P1slntlff
,
I
:
StoltzFuB, WByns R.
PlllintlfF
VB
VBriBbls Annuity LiFs
InBurBncs Company
DaFsndBnt
In ths Cumbsrland
CCll.mty Court of
Common P hBB
No. 85-358D Civil Tsrm
* Proof of 6srvice *
I, HBynB R. StoltzFuB, Ple1ntiFF oertiFy that I have on thiB
/4=-rll dey of July I 1995, BervBd a copy of thiB complBint to
tha defendant by certiFied United 6tetes msi1, postaGe
pra-peid stl
Varlabls Annulty LiFe Ineurance Company
2828 Allan Perkway
Houston, TX 77018
COI Mr. SradFord Dorranoe, Esq.
210 Walnut 9treat
HarrlaburG, PA 17108-1863
W~t- e ,luRf
W.yne R. StoltzFus
Wayne R. Stoltzfus
Pleintiff
vs
Veriable Annuity Life
Insurance Compeny
Defendent
IIn the Cumberland County PA
.Ccurt cf Common Plaaa
I
I
I
I No. 95-3590 civil Term
Prseclpe For Evidentary Hsering
1. Ths PlsintifF hereby requesta that the court achedule a
heering to determine the evidence in the abcve matter.
2. The emount of damages that PlaintiFF aeeKs, $3,134.89,
is within the limita Fcr arbitration in Cumbarlend Ccunty.
3. PlaintiFF haa subatentially complied with all rulea aB
they hava been mada Kncw tc tha P1DintiFF. PlaintiFF
theraFore eSKs that this ccurt order his evidence to be
heerd.
Oe~tlFleBte eF Ba~vIeD
I ce~tIFy thet I have cn thIa day se~vad a cepy eF thIs
decument upen the pe~Ben(B) Bnd In the manne~ IndIcatBd
belew,
Fi~Bt elBBB mBll, peBtBge p~e-pB1d add~eBBed tel
VALle
2B29 Allen PB~kwBY
HeuBten, TX 77018
()d- (,1 Iffr
:-,
I(rar- R )r~i----
Weyne R, BtcltzFuB
Ef
;.....
QI
P:;
t
'"'. ~.-.
~i~
6i
Wayne R. BtoltzFua
P1ulntlFF
vs
V~riable Annuity LIFe
Insurence Company
DeFllndent
lIn the Cumberland County, PA
.Court of Common P1eBB
I
.
INo. 85-3580 civiL Term
Amended Compieint
1. Defendant entered Into a written contrsct with the
Ple1ntlfF (copy sttachsd).
2. Defendent Issued written proepectus' In conjunction with
the written contrsct (copies etteched). These prospectus'
stete thst Plsint1ff's funds will be surrendered, upon
written request to the compeny's hcme oFfice, within five (6)
business deys efter receipt of the written request. No
other conditions ere required, either by contrect or
prospectue.
3. Thll defllndllnt felled end refused to rll1eese Plll1ntiFF's
Funds ee required by the written contrect end prcspeotus.
4. Plaintiff suFfered e iose of $3,134.89 becsuee of
defendent'e Fe11ure to Bot In accordance with the contrect
end prospet>tuB.
6. Plllintlff auks for full rllimbursement of th1a loes, pius
sny subsQqWllnt 1ncrellso in velue, plus eny end s11 costs
assooiated with this ect10n.
6. This amount, $3,134.99 Is within the limits For
erbltretlon rsferrel In Cumberlend County.
r~~ - ~ {JtJ'f( 1--
Wayne ~, Stoltzfus
Phdlltlrf
August 14, HIBS
If
\f't!ft
ft-
, .,
;~\f;l.
e!~; .
ie, ::t,
it i~ ;~:..
r~ ~;q t~
'" ~7:.t. ftl
': ntil tl
j-'!fUHi
b~+i
...~
.....
.....
U.,
w
~
tJ
..
~
.'
.
August 14, laaS
Notice to DeFend
You s~a being sued In Cumberlend County, Pennaylvsnle
Cou~t. IF you wish to deFend egelnst the oomplelnt, you o~
your ettorney mUBt respond to the court in wrlttlng within
twenty (2D) deys. IF you Fell to reBpond, e Judgament mey
be entered egelnst you without Further notioe.
These pepere Bhould be given to your ettorney ee Boon
ee posBlble.
.
Augult iii, 199B
Vlrlrlolt1on
I, thl und.,..lgned, hereby oertify end .tet. th.tl
1. I.m th. Plaintiff in thi. metteI'.
2. The fBots oontalned In this amendment and in my
oompiaint dated July 14, 1995, ara true and oorrlot to th.
best of my knowiedge.
3. I undB,..tand that false statements are mlde sUbJlot to
penelties "elsting to unsworn falsification to Butho,.ltiea,
..~~t ~,t'!fJ
PI alntlff
.
AUgUBt 14, lBBB
Ce~tiricata cr Be~vica
I he~eby ce~tiry that I hava cn this day .e~ved a cc~y
cr thia dccument upcn the pe~acn(s) snd In the manne~
indicated belcw.
Firat clee. msi1, pcatsge pre-psid eddreased tCI
Varieble Annuity Lire Insurance Ccmpsny
2B29 Allen Ps~kway
Hcu8tcn, TX 7701B
I,;
'.
....w
:j-.,.
.
q",!
t\..J
~-./ft;
r-,
~;i
,,;~\
,j,:~
C'~\')~ n
-;: :::.: t ~ '*'
i'~~
'-("r
If
Oi
~
~
dl
t.A
INPaR~AT10N PA~E
-
BeNSPICIA~Y
THe eeNEPICIARY SHALL BE AS CESIGNATeO IN THE APPLICATION UNLess
SUBSEQUENTLY CHANGeD AS PROVIDED IN THE CONTRACT.
ANNUIT^NT 1 sTOLTZPUS,.AYNB R
2204 SPRING RUN DR
MECHANICsBURG PAI7055
GROUP ACCOUNT NUMBERI 03091
CERTIFICATE NUMBeRl 8775320
OATS OP ISBuel 12-01-83
GPA-'d2-0C
PAGe 2
..
I
THE VARIABLE ANNUITY LIFE
INSUR_NCE COfJPANY
2121 AII.n Perkway . HOullon. r.... 11019
GROUP FIXED ANNUITY
PARTICIPANT APPLICATION FORM
.
Soclol Socurllv No.:
[[LJ-[]]-1iT[]
[J]-ITJ-ITJ
...... 0 0 .,
Please p"n, all ,"'ormatIon
1, PARTICIPANT
Nome:
Blrlhdlte:
UII hi'
......01.1/10"..
Sex: 0 Mile 0 Femele
Melling AddroBl:
ITJIIIIJ
m-@D]-IT]
..... 0 0 .,
H.
'''HI
EmploYlel.D, No.:
..,... ."
,,: ..'.
I.
Cd, $1'lttA.~
Telephone NOI,: Home - ( ... - )
.,..,"'
Olllce - ( )
"" c04e
;. ~... ;. ',' -- '.
AnnUity Dlle:
2. EMPLOYER INFORMATION
Employer (Owner) Neme:
DJ-CIJ-GJ
.... 0 0 't 't
"
} .;1,_'->
Employment Dotl:
.,' ._~ .... ,-'
Group Account (GAl No.:
~
~
Sub Group No.: DIJ
-'-:.\-
.1 "
3. TYPE OF PLAN
(1) .Jll'.403(b) Tax Dole/rod Annully (TSl
(2) 0 Optlonel Retirement Progrem I TDA Vutlng (IV)
(31 0 401 Pension Plen (PN)
(4) 0 Other
- ,
.,,-;
......., ..1 I.
MONTH(S) PAYMENT EXCLUDED:
(11 0 Jen. (T) 0 Jul,
(2) 0 Feb, (8) 0 Aug.
(3) 0 Mer. (9) 0 Sept,
(4) 0 Apr. (10) 0 Oct,
(5) 0 Mey (11) 0 Nov.
(8) 0 Jun. (12) 0 Dec,
4. PURCHASE PAYMENTS(S) ::.- I ::c .::,.cr.)
~ It' PlY .01 p.,"'t. .......... MIl, .....-. aliI
Periodic: mJJx[[].~ OJ rn OJ
.... 0 0 't.,
rrd:Iffm;rn:oJjjfjjJ] afED'lorn
.... 0 0 .,.,
Single
Sum:
Inltlel Flexible rrr-rrrTTl
Peyment Amount: LL.U-.LLLLJ
Cap, Trens. Amt. - 0 YES
ONO
5. BENEFICIARY DESIGNATION
OM.""""
--
DI" ,I htft
c........... ItIltIC*"
"
, ''!' , f "'. .: ~~-
..: -.' ..'~
) :--~.. ~...; . / I .
locleI.tcWIfY......
SooIl'KIllIt., ~ AtI6IhCllltIMII
"elIllOI'I'"
l.. I,'. ,I,.
..,. I. (
Ae*... t~ liO CHal
....... l~ l~ CHI I
)".. ", ../.' ~'o'/ v"""
6. SPECIAL REQUESTS
Thle Ippllcetlon Ie lublect to ecceptence by the Campeny et lie Home Olllce. It II underatood that prool af aoe will be
'urnllhed belore ennully payments begin,
la thlla replacament of en ulatlng IlIe Ineurence or ennully contrect? 0 Yea' EI. No
. II Yu. Name 01 Compeny
'f
Dq you cUr/enlly own or perllcipale In enolher VALlC ennully Contrect? 0 Yes 0 No
; i I .....,.. ~ .:.!". ~.. .A.~; ....
.!. '."" _.' ._~. ,.". lJ'teoat "I,t dlte ....
't"oeoO.lll,I'911.IIlf' . \"'c l. , ..:" .. '~r ~,
'. , l ~ C " '
I 0 do 0 do noll1eve reDlon 10 bell,ve !Jiel replecetnenl ot exll\lng lIle inlurence or InnuHy may be invalved.
19_
.-
. ,..~,..
w.,
.......4..lo9ll""'.
........, H."'. I't.... P""II
\. ~-"
-:.;.....'
, , I
Oil'
.,.....s"'I'I.,....
......
.....
..C:UtlHtI,IHl)M.OIlUI
'-
SIC lion I
Slcllon 2
SIC lion 3
Slcllon "
SIC lion IS
Section II
or.....PC(tt'I
TADLE OF CONTENTS
Dlltnlllonl
Purcha.. Plymlnt and Vlluallon Provlllonl .
2.01 Purchlll Plymentl
2.02 Annully Vllue . . . . . . . . . . . . . . . . . . . . . .
2.03 Surrendlr Vllue . . . . . . . . , . , . . . . , . . . , .
2.04 Minimum Annuity Vllul . . , . . . , . . . , . . . . . , . . , . . , . , . .
2,OlS SUlpenllon 01 Purch..1 Paymlnta ..,.".,.... . . . , . . . . , . . . . . . . , . .
Chlrgel Undlr The Contract . .. ........,.......,....,.,.."....,.....
3.01 Chlrgl for Prlmlum Taxll, . . . . . . . . . . . . . . , . . . , . . . , . . . . . , . . , . . , . . . .
3,02 Chlrge for Plrtlll and Total Surranderl . . . . . . . . . . . . , . . . , , . , . , , . , . . .
Annuity alnent Plyment Provlllonl . . . . , . . . , . . , , . , . . , . , . . . . , . . . . . . . , , . ,
4.01 Annully Date . . . . . . . , . . .. ...."..,..,..."...,...,........,",..
4.02 Election to Commence Annully Blneftt Paymentl ., , . . , . , , . , . . . . , . . , .
4.03 Annuity Option I .......... . . . , . . . . . . . . , . . . . . . , . , . . . . . . . , , . . . . . . .
4.04 Automatic Annuity Option. . . , . . . , , . . . . . . , , , , . . . , , . , , , . . . . . . . , . . . . .
4,05 Minimum Annully Beneftt Payment. , . . . . , , . , . . , , . . . . . . , . , , . . . . . , , , . .
4.08 FreqUlncy at Annuity Blneftt Payment I ".."..................,...
4,07 Bellerment of Ratel ..,......,.,..,.,.,..,.....".,....."...,..,
4,08 Annuity Tablla .,...,.',. , . , . , , , . , , . , , . . , . . , . . , . , . . . . . . . . . , . . . . . .
Dlath Plyment Ind Benlncllry Provlalonl .,.",.".......,.,......,..,
5.0 I Death af Plrtlclpant Prior to tha Annully Date. . . . . . , . . . . . . . . . . , . . , . ,
5.02 Death of Annuitant During thl Annuity Plriod , . , . . . , . . . . , . . . . .. . . . . . .
5.03 Beneftclary Olllgnetlon .".,.,...,.,...."...........,...........
.............
aln.ral Provlllona. . . . . . . . . . . . . . . . . . . . . , . . . . . . . . I . . . . . . I . . t . . . . . . . . . . .
8,01 Participant CertlftCltl1 . . . ." . . , . . , " . , ..' , ,... . .. .,. .... ..... ....
8,02 MI....tement of Age or SIX ..,.,..... , . , . . . . . . . . . , . . , . . . . . . . . , . . .
8.03 A..lgnmenta...........,...,....,...,...,..........,.......,....
8.04 Incont..tlblllly..,..,..,....,.......,...........,..,..,..........
8.05 Rlporta to Plrtlclpantl. . . . . . . . , . . . . , , . . . . . . . . . . , . , . . . . . . . . , . . . .. .
S.08 Minimum Blntftt., Payment. and Valu.. . I . . . I.' i I . ." . I. . . I . . . . I I .
Page 3
~I!
4
4
4
"
"
4
"
5
IS
IS
IS
IS
IS
5
8
8
8
8
517
8
8
8
8
8
8
8
8
II
II
g
VAStO'"
J "
Section 1
DE::INITIONS
1.01 Account - reterl to a Partlclpent's Account. See Section 1.13.
1.02 Accumulation Period _. the lime between the date at Ihe nrll Purchue Payment and tha Annully Dala 'or a
Participant.
1.03 Annullant _ tha Partlclpaot upon whon IIle annully benenll Will be band Ind to whom annuity bananta will
ba paid. IIlhe Parllclpant diu pflor 10 Ihe AnnUity Dela, Ihe Benenclary mlY be treated al the Annullant.
1.04 Annuity Date - the dale when annUlly benenl peymentl slart.
1.05 Annuity Partod - the lima when annuity beneftla are paid,
1.06 Benallclary - the peraon who Will rocelve peymenta. ,t any. on the Annultant's death.
1.07 Certlllca'a V.ar _ a twelve monlh peflod which stertl with the leaue date 011 Particlpanl'a certlftcale and
each anOlvarlery 01 that date.
1.0B Contract Ownlr _ tha employer. or organization. which makea application lor the Conlract,
1.09 Conlract Vear _ e twalve month parlod which startl with the leaua data 0' the Contract and each annlverl~ry
01 that date.
1.10 Home ornce - the main omco of VAL1C at 2727 Allen Parkway. Houaton. Taxu 77019.
1.11 Nat Purch... Payment - a Purchue Payment leu any premium tSxel which mlY apply.
1.12 Participant _ a person who maku Purchue Payment I or lor whom Purchue Payment I are mada under tha
Contract,
1.13 Partlclplnt'a Account - an account let up lor a Participant to record tha Annully Value (Section 2.02) for
him or har.
1.14 Purchaae Paymenta - amounta paid 10 VALlC by, or on behall 0'. Partlclpantl.
Section 2
PURCHASE PAYMENT AND VALUATION PROVISIONS
2.01 Purcha.. Paymentl
Purchue Paymanta may ba paid to VALlC at any time for an Account. Tha emount may bl detlrmlnad by tha
Contract Ownar or Ihe Participant; and may ba lublect to Ihe provlllonl 01 tha ContraL. Owner'a RaUramant Plan
and/or the Internal Revenue Coda 01 1954. Purcheae Paymenta for a Participant may only ba made during hla or har
IlIaUme, The Contract Owner shall slate the amount to ba credlled to en Accounl.
2.02 Annuity Valua
The Annuity Valua lor a Participant during the Accumulation Period II aqual to the Nat Purchue Paymantl
racalved for him or har, plus any Inlerul credited 10 hll or her Account. leas tha emount 0' any psrtlal surrenders
InclUding charges.
During the Accumulation Period, interest will be credlled at a rste detlrmlned by VALIC. The Intarest rate shall
be set In advance ot Ihe tlma to which il relatel and shall not be Isu thIn an enBctlve rate 01 4\',% plr yaar.
2.03 Surrandlr Value
The Surrender Velue of an Account II equel to the Annully Value leu lurrender charges which apply. (5..
SecUon 3,02)
In the cau of a fulllurrander 01 an Accaunt prlar to Iha Annully Date. Ihe Surrender Value ahall nevar be leea
than Purchaea Peymenta received for the Participant lesl any prevloul partial surrendara.
2.04 Minimum Annuity Value
II dua to partial surrendere the Annuily Value 01 an Account lalll below 5300. the Account may ba automatlcelly
surrenderad,
2.05 Suapanalon 01 Purcha18 Paymantl
Purchaae Payment a 10 an Account mlY be stopped al any lime. II addlllonal Purchue PlymenlS Ire nol made.
Ihe AnnUity Vllue of the Accounl will sllll earn Interell. Purchase Paymenls may ruums Iny lime prior to Ihe Annully
Dsle so long as the Account haa nol been surrendared and the Conlract IS still In lorce.
Page 4
GlI'''U'lr.UU
~, 110'"
Section :]
CHARGES
3.01 Charg. for pr.mlum Taxll
VALIC WIll deduct premium la.el which mav apply Depending on state law any luch deducllon Will ba made
alth.r: trom Purch8le Paymentl when tecelved. or Irom tha amount applied to provide InnUlty beneftll at Ihe lime
Ihey commence. II no tu WII deducted but leter lound to be due. VALIC Will reduce Iha Annully Value or beneftla by
Ihe amounl olla. due allhe lime such a ftndlng IS made. IIta> was deducted but laler lound nollo be due. VALIC Will
apply Ihe amounl deducled 10 Increase the Annully Value or beneftll at the lime such s ftnding IS msd..
3.02 Cherg. tor Partial and Tolal Surr.nd.ra
A partial or lotal surrender 01 an Account may be sublecl 10 a charge. II It applln. thll chlrge Is .qual to the
I....r of 7% 01 (e) all Purcheae Paymenll which have been received lor the Account during Ihe eo month. jusl prior
10 th. surr.nder. or (b) Ihe emount allhe surrender.
For purposea o'lh. charge:
o Ihe 60 months are caunted Irom Ihe day Ihe surrender requell Ie received al Ham. Office; and
o Ihe malt recenl Purchase Payment a are aslumed 10 be withdrawn ftrlt.
II no PurchUe Paymantl have been racelved tor an Account lor Ihe malt rac.nl 60 monlhl or I' an Accounl has
been in effact for 15 yearl or more. then Ihare will be no charge lor partial or total aurr.ndarl,
The ftrlt partial lurrender per CertlftClte Year 01 10% or leu 01 the Annully Va1u. 01 an Account will not be
lubl.ctlo a charga. II the ftrst partlallurrender ..ceedl 10% ollhe AnnUity Valu. ot an Account. the charge will ba
on the amount in ..Casl 01 10%. The second or any other surrender I of an Account during a Cartincat. Year will be
subj.ct to s chsrge,
Once e surrend.r charge hu been Impol8d on eny Purchase Plyment or part thereof. that Purch8le Payment or
part will nollhereeller b. lubjeclto a charge,
The lurr.nder charga II nollmpoled at the time benent peymanta commence (e.cept under the ftllh option when
the right to aurrendar slier b.neftt payments commenca II e..relaed) or on sny psyments rec.lv.d by a B.nenclary In
lieu 01 b.neftt paymenll during tha Annuily Parlod. The lurrender charge il not Impol8d on Iha paymant at benenll to
a B.nenclary whan a Participant dlea during the Accumulation Period.
Section 4
ANNUITY BENEFIT PAYMENT PROVISIONS
4.01 Annully O.t.
The AnnUity Date may be Iha ftral day of any month allar a Pertlcipant's 50lh birthday and bafore a Pertlclpant's
76th birthday, In Ihe absence 01 en alectlon. Iha Annully Olta shall be Iha ftrst day 01 the monlh In which tha
Partlclplnt attains age 75.
4.02 EI.ctlon to Comm.nc. Annuity B.n.nt Paymenta
Any time prior ta the Annuity Data a Participant (or Annuitant) may nls a written request at Hom. Office. on a form
furnllh.d by VALlC. 10 elect on. of Ihe Annuily Optlonllllted below, Th~ requast will be an elactlon of such option
unlen a lurther requast to change the election la ftled.
4.03 Annuity Optlona
FtRST OPTION _ Lite Annuity _ An annullY paysbl. monthly during the AnnUltanl'llIl.. paym.nts Ihsll cnle
wllh th. lut on. due prior to the death ollhe Annultenl.
SECOND OPTION _ Llle Annully wllh 60, 120, or 180 Monthly p.ymenta Guer.nlud - An Innuity peyable
monthly dUring Ihe IlIe 01 an Annuitant. II. althe daeth ollhe AnnUitant. payments heve baen made tor 1.81 than
Ih. number of months selecled. peyments will be made 10 a Beneftclary for the rut of the certlln period.
THIRD OPTION _ Cuh R.lund Lite Annully - An annUlly payable monthly during the lite 01 Ihe Annullanl.
Paymentllhall ceeae wlfh Ihe leat pevment due prior to Ihe dsslh 01 the AnnUitant. Allhe dulh 01 the Annuilant.
Ih. Beneftclary mey rscllve an addllional paymenl. The peyment. If any. II equal 10 Ihs ucon of Ihe AnnUity
Value IPplled to thiS option over the lotel paymentl already received.
FOURTH OPTION _ Jotnt and Lasl Survivor Annully - An annuity payabla dUring the 10lnl live a 0' IhI
Annullanl and a named second person and tharealler during Ihe IIle ollha survivor
Page 5
/A)IO'"
GIlA.". ,r.lfll
..:J.~~'~'
FIFTH OPTION - Paymentl lor a Oellgnaled Period - Payments meda monthly lor a selocted numb or 01
vears. The number 0' vaa,s msy bo between three and ftllean. At enV lime Ihe Annuitant msv elect to racalve In
ona sum the preeenl velue o'lhe remelnlng paymantl computed al an Intereet rale 01 3'.% per annum. IIlhe
elecllon 10 receive the preunt velue II made, any charge which would be due on a surrender al thai lima will
IPply.
4,04 Automalic Annuity OpUon
IIlhe Annuitant doee not elect one ot the oplionl prior to the Annuity Dale. benefil paymentl will be made by the
second opllon. with 120 paymentl guaranteed or by such other opllon Ipeclfted In Ihe provisions 01 Iha Conlracl
Owner'l rellremenl plan,
4,05 Minimum Annuity Oenelll Paymlnt
No elecllon ot an option may ba made unlell a benefit payment 01 allalll $25 would ba made,
4.08 Frequlncy 01 Annuity Oenlftt Paymenta
eonlfil paymanls will ba made monthly, II paymants would amount to leaalhan $25 aach. VALIC ra.erv.. Ihe
righllo makalell fraquant payments. II the onnual rata ot paymant to a psyae Illau Ihsn $100, VALIC may mlkl I
lump lum payment ot Ihe remaining valua to Ihe payee,
4.07 Oellermlnt 01 Ratla
lilt would producl greeler benefits, the Imounl ot the Annullenl'l monlhly payment will be Ihll which would be
producld by e then currenlly IlIued Immldlall Innulty, The Immedlale annully Ihall bl of Ihe ume form, It Ihall hlvl
a Ilngll plymenl equal 10 Ihe Annuity Value being applied under Ihll conlracl, Any commuted valulI allowld undar
Ihe IIIUemenl provlslona will be baaed on Ihe Inlerell rale uud to detarmlne the net lingle premlllm tor such
annul1l8l.
4.00 Annuity Tlbl..
Thaae tablel Ihow the amounl required 10 purchase a firll monthly psyment 01 $1.00, The tablea are baaad on
thl Pragreaalve Annuity Table with Inlerelt sllhe rate ot 3Wlb per vear and aaaume blrthlln Ihl year 1900, The
amounl applied to e"ecl an annuity will be tha Annuity Value on Ihe lenth day pracedlng the dste Iha nral plvmlntll
due, Thaamount 01 each paymant will deplnd on Ihl Annultanl'l au and Ihe Annuitant's adjulted aga atlhe IIml the
nrlt plymlntla dUI, Adjualad age Ihall be In accordance with Ihe fallowing:
Cllender Yoer or Ilrlh Adlua'ed A,o II A.lull A,e
Oe'ore 1918 Mlnul 0
1918.1935 mlnul ,
1938.1955 mlnul 2
Aller 1955 mlnul3
ActuII Age, aa uud above, Ihall mean the aga attha birthday nearallto tha tlmathe firlt plymantll dUI,
Pags 8
QIIA.II. 'I':C_'
YAIIO'.'
...
DOLLAR AMOUNT REQUIRED TO PURCHASE AN ANNUITY
WITH A FIRST MONTHLY PAYMENT OF $1.00
Options " 2 and 3 - Single Lile Annuities
Adlu.lld All'
M.,. F.m.',
50 54
51 55
52 58
53 57
54 58
55 59
58 BO
51 81
58 82
59 83
80 84
81 85
82 58
83 81
84 88
85 89
88 10
81 71
88 72
89 13
70 74
11 15
12 78
13 71
14 18
75 19
Non.
S210.85
208.73
202.54
198.21
193.93
18Ul
t85.03
180,48
175.87
111.21
188.49
181.73
158,93
152.09
141.23
142.35
131,48
132.01
121.81
122.19
111.93
113.11
108.32
103,51
98.89
94021
Mon/hly P.ym.nll Guer.n/lld
80 120
$211.36 $213.06
201.30 209,18
203, 11 205.26
198.97 201.28
194.70 191.26
190.31 193.20
t85.98 189.11
181,54 185,00
171.04 180.87
112,50 118.13
16793 112,59
163,32 168.41
158,69 164,31
154,05 160.30
149.40 156,28
144,78 182.31
140,11 148.42
138.50 144.62
130,91 140,92
128.37 137.32
t21,89 133.8B
117,41 130,84
113,13 121,37
108.88 124.37
104.13 121.58
100.69 118,92
r80
$216.23
212.88
209.12
208,85
201.98
196.39
194.62
191.26
181.71
184.31
160.91
177.58
114.34
111.19
168. t6
165.25
162.46
159.66
181.40
185.12
183.01
181.09
149.36
141.82
148.46
148.29
Adlu.,.d All' 01 Annuillnl
M.58 M.8 I 1.4.83
F.82 F.85 F.87
5221,18 5223.89 5221.81
214.88 209,38 208.38
209,88 204.01 200.80
203.38 198.39 192.18
199.80 191,12 166,96
194.31 1611,42 179.88
161,42 176.84 170,08
Option 5 - Payment lor a Designated Period
Yu" 01 P.ym.nl
3
4
5
8
7
8
9
Option 4 - Joint and Survivor Llle Annuity
Adlu.,.d All' 01
S.cond,ry
Annult,nl
1.4.,. F.m,',
80 84
811 59
81 81
80 84
62 66
88 69
70 14
M.5'
F.55
5231.19
229,011
2211,91
221,91
219.88
216.112
212.11
1.4.55
F.80
5229.88
216.34
214.14
206.43
204.99
200,49
194.68
QU.'" ~I'"
Y.er. 01 P,ym.nl
10
"
12
13
14
15
. 34.28
44.90
55,'9
85.15
74.74
84.03
93.02
Page 1
CUh R.lund
$ 220.90
217.38
213.91
210.30
206.62
202.99
199.23
195.40
191.64
161.15
163,16
119.90
178.90
171.61
161.86
163.76
159.58
t55.59
181.42
141,16
143.19
136,91
134.66
130.74
126,82
122,18
1.4.88
F.70
5218,92
202.42
198.93
1811,50
160.88
112,21
160.43
M.7I
F.75
5218.13
191.39
190.01
119.02
111.88
161.64
146.43
"01.73
110,01
118.20
125.94
133.5/
140.85
yA'IOro'
-.
Section 5
DEATH PAYMENT AND BENEFICIARY PROVISIONS
5.01 Death 01 Participant Prior to the Annuity Date
II a Partlcipanl din dunnQ the Accumulation Pellod. there Will be an amount payable 10 Ihe Beneftciary. Thll
amounlls eQuatto the Qreater 01: (a) Ihe Annuity Value on the date VALlC rscelves a certlfted copy ollhe daelh
certlftcate. or (b) 100% 01 Purchaae Payment a leaa any prior partial surrenders.
The Beneftclary may elect wllhln 60 daYI after amounls would be paid to receive Ihe delth paymenl II a lump
lum or In Ihe form 01 one ot Ihe AnnUlly Opllons. The Beneftclary may Ihen e.erclae all IIQhl1 which an Annullanl
would have dUllnQ the Annully Penod.
5.02 Death 0' Annullant During Annuity Period
II an AnnUltanl dlel durlnQ the Annully Penod, a Beneftclary may be entitled 10 receive paymenl. II so, Ihe
Beneftclary mey, wilhln 60 deYI after amounll would be psld, e1ecl one 01 the 101l0wlnQ. TheIs are not available II the
Annuitant waa receiving paymenls under the lourth option.
. elect 10 recaive in a lump sum Ihe prnenl value com puled at an internt rale ot 3';% par annum, 01 any
remaining beneftt paymsnls; or
. slect to continue recelvlnQ beneftt payments: or
. elecl 10 heve Ihe value 0' anv beneftt paymenls owed applied 10 any ollhs ftve Annuily Options.
IIlhe Bensftclary elects ellher 10 continue 10 receive beneftl payments, or 10 racelVe Ihe value 01 such payments
under one 01 the ftve Annuity Options, the Beneftclary II entitled 10 all rlghtl hereunder.
5.03 Benellclery Dulgnetlon
The Annullant may change any Beneftclary during the Annultant'llIle. An Irrevocably delignated Beneftclary can
be changed only wllh Ihat Beneftciary'l written consenl, Any change mUlt be ft1ed In writing with VALlC at Ita Home
Olllce. Upon receipt, Ihe change shall lake effecl II o'"s signa lUre dlte, It shall be subjecl to any Ictlon laken by
VALlC prior 10 receipl.
Proceeds will be dlltrlbuled in accordance wilh Ihe lollowing provlslonl, Two or more Beneficlallelllvlng It the
Annullant's death shelllhere Ihe proceedl equally. II any o'lwo or more BeneftclallU die before the Annuitant, all
proceeds shall be paid 10 any surviving Beneficlary(les), II no named Baneftcilry illlvlng atlhe Annuitant's daelh, the
procleds shall bl paid 10 the Annuilant's eltate. IIlhe Beneficiary diu at the same time althe Annullant, rights to
thl proceedl shall be determined aa Ihough he or she died before Ihe Annullant, The Beneftclary'l dleth shill be
dlemed atlhe eame time aalhe Annuilanl'slllt occura within 16 deYI of the Annuitant's death. Prool of lurvlvel for
thlt time may be required by V ALlC Irom any perlon entitled 10 payment. II the Beneftclary dies while receiving
plyments under Ihe second or fttth optlonl the value 01 remaining paymentl. il any, Ihall be paid 10 Ihe estate oleald
Beneftclary ,
Section 6
GENERAL PROVISIONS
6.01 participant Certlncate..
VALlC shalllaeue certlftcates to eech Participant. These will lei torth Ihe benefttl end Ihe Beneftclsry entitled to
receive-payment on Ihe Partlcipanl'e dealh, Certiftcatal are nol a part ollhe Conlracl belween Ihe Contract Owner
Ind V ALIC.
8.02 Mlntatlment of Age or Sex
II en Annuilant's age or sex hll been mllltaled. or Ihlt of any Benaftclsry under I setllement opllon which
condition I pevmenl on the Baneficiary's survival. any smount payable by VALlC Ihell be Ihst which would hsve been
peld on Ihe bells o'lhe correct Inlormetlon. II a correction 01 age or sex II made while peymenll are being made, the
Imount 01 anv underpaymenl Ihall be paid in lull with Ihe next payment. The amount of any overpsymant Ihall ba
deducled Irom amounts payable Ihereafter.
II any peymenl(s) is(are) conditioned upon a payee's survival. VALlC will require proof 01 the payee's age, No
payment shall be due unlll due proot is received at Home Olftce.
8.03 Anlgnments
A Par1icipanl's rights hereunder mav not be sold, aaelgnsd, discount ad, nor pledged II collatersllor a lOin, nor
as secullly for the perlutmance 0' an obligation, nor otherWise translerred olher Ihan to VALlC. Unleea contrary 10
law. the values hereunder shell not be sublecl 10 any credllor clalml.
P ege B
VAI.".t
QIIA..."r.IRI
...
8.04 InconteltlbUlly
No stllement made by any Annullant shall be contaatad alter two vearllrom Ihe date Ihat the Annuitant wn nrlt
covered hareunder.
8.05 Reportl 10 Partlclpantl
VALIC will mall to each Participant. allant snnually each Call1ncale Year durlno the Accumulation Period. a
Itltament reporting the AnnUity Value of the PartlClpenl's Account,
8.08 Minimum Blnenlao Paymenla and Valuel
Any pald'up annuity. cnh lurrendar. or death payment hereunder Ihall not be Ie.. lhln the minimum rlqulrad by
the lawI 01 thl Itate In which thl Certlftclle la delivered,
.
.
I
.
Pagl 9
OPA.ut'f.UII
~lSIO'o\
The Group Unit Purcha.se Variable Annu.
ity Contract ("Group Unit Purcha.se Con.
tract") offered pursuant to this ProspectUJ
by The Variable Annuity Life huurance
Company ("Vallc") Is designed pnmarily for
we in connection with retirement pl8IU qual.
ified under Section 401 and 403(b) of the
Internal Revenue Code of 1954, a.s amended
(the "Code"), The Contract may also be
wed for certain plans which do not provide
special tM.deferred treatment, (See '"The
Group Unit Purchase Variable Annuity Con.
tract, page 10.)
The Variable Annuity Life Insuranca C"m~any
(VAlle)
Separate Account One
Group Unit Purchase Variable Annuity Contracts
ing amounll accwnulated in otber plans
issued by Vallc or other clll1iers. Premium
tues, when appUcable. are deducted from
the valul 01 the partldpant's account at the
time of retiremeot. Premium tuel range
from zero ta 2.5%. (See "Sales and Other
Expenses". page 8.)
Net purcha.se paymenll under the contract
are placed in The Variable Annuity Life
Imurance Campany Separate Account One
(the "Separate Account"), a dlversiOed, open.
end management inveshnent company
inve.sting priml1lily in common stocla and
other equity type inv~shnenll which has, a.s
il3 principal lnveshnent obfective, long.tenn
capital appreciation. (See "Investment
Olifectives, PoUdes and Resbictiom", page
6.)
A deduction 01 .00304% per day (1.44%
annually) on the first S200,OOO,OOO of thl
Separute Account a.ssell, .00384% (1.40%
annually) on the next S1oo,OOO.OOO of such
a.ssell, .lX137 4% (1.36% annually) on the
nClt Sloo,OOO.OOO 01 luch a.slla, and
.00364% (1.32% mnually) on such aUlu
over '400,000.000 is made from the CUlTent
value af the Separatl Account. TIle annual
charge consiltJ of .M% lor mortality under.
takings, .15% lor expense undertakings, and
the lialance (from .44% reducing to ..12%)
for lave.tment advisory lerv1C1lS. Vallc may
receive a proOt in the event that challel for
administrative expenses exceed actual COlli
of administrntion, (Sel "Martallty and
Expense Undertakingl and Investment Ad.
visory Services", paqe 9.) Vallo is the invOlt,
ment adviser to the Separate Account. (See
"Investment Advisory Ser.1ces". page II.)
TIlere are no charges lor redlmptiolU.
The minimum laitialmd subsequent pur.
chase payment per participant II '25 ',er
month, For plans qualified under Section
401 of the Coile. the minimum Initial annual
purcha.se payment per L'Ontract owner II
S2,000 and IUbsequent mllllmum annual pur.
cbase paymlnll arl '-'5.000.
A charge of 5% of the first '5.000 of grOIl
conbibutions (5.26% of the net amount
lavested) and reducing, on a decUning scale.
to 3% of amounll contributed In excess of
$15.000 )lTIl1l contributlom (3.09% of the
net purchase paymeall above that level) il
deducted from each purcha.se paytl'ent ax
received, Vallc ha.s estimated that of the
percentages deducted, 1.25% Is for admlnis.
trative and other ellpemes. and the balance
II for sale.s expemes. Reduced charges are
applicable ta lump sum payments represeat.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVID IY THI
SECURITIES AND EXCHANGE COMMISSION NOR HAS THI COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPICTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
ProspeclUs dated Apnl lO, 1979
,...~...~-",-.trr
.
The usurll1lces under the Group Ualt Pur.
chue Contract apply far the lifetime of a
partlclpll1lt for purchue paymenb at II1l
annual rate of up to 200% of the amount
of the flnt year purchase paymenb made on
his behalf. Vallc may modify the Grour.
Unit Purchase Contract (except where mod.
Rcation lJ prohibited by the Invesbnent Com.
pany Act af 1940) with respect to such
8IIurances for those purchue paymanll In
excess of such amount after the elrectlve
date of the modUlcatlon.
ThlJ Prospectus should be retained for
future reference.
TABLE OF CONTENTS
Page
2
4
4
5
Candensed Flnll1lclal Infonnation
Glossary . . . . . . . .. .. , .. .. .
Introduction ,. . . . . . . . . . , . . .
Vallo and the Separate Account ...........
Invesbnent Obfectlves, Policies, II1ld
Restrictions . . . . . .
State Invesbnent Laws .
Portfolio Turnover . . .. .. . . . . . . . . .
Cbuges Under Variable Annuity Contracts .
Sales and Other ExpIRIeS . . . . . . . . . . . .
Mortality and Expense Undertakings and
Invesbnent Advisory Services . . . . . . . . . .
Allocation of Brokerage . . . . . . . .
The Group Unir Purchase Variable Annuity
Contract ................. ......... 10
Accumulation Period 11
Purcbase Limits 12
Con8nnation of Transattlons . 12
Partial Redemption 13
Tennlnation (Redemption) Value 13
Death BeneBt Before Retirement 14
Initial Withdrawal and Refund .. 14
Annuity Period 14
Anumed Invesbnent Rate 15
Variable Annuity Options 16
6
7
8
8
8
Page
Level Payments Varying Annually 17
Assfgnmeat. .....................,...... 18
Federal Tax Status of the Company . . . .. .. 18
Federal Tax Status of Participants. . , . , . . . .. 18
General . . .. ................. 19
Section 403(b) Tax. Deferred Annuity
Contracts . . . . . . . . . . . . . . . . . . . . . 19
Qua1l6ed Pension and ProSt-Sharing Plans 19
Self.Employed Individuals .............. 19
Other Variable Annuity Contracts . . . . . . . . .. 20
Management . . . . . . . . . . . . . . . . . . . . , .. 21
The Board of Manlgers ....... ..,.... 21
Directors of Valle . . . . . . . . . . . . . . .. 22
~~fcal omc~rs (Other~U1D~~~~). ~f ~
Remuneration of the Board of Managers
and Certain Affiliated Persons . . . . . . . . ., ~
Vating Rights . . . . . . . . . . . . . .. ~
DiJlributlon of Variable Annuity Contracts M
Safekeeping of Securities . . . . . . , . . . .. 'I:T
State Regulation . . . . . . . . , . . . .. 'I:T
Legal Proceedings . . . . . . . . . .. rr
Legal Opinions 'I:T
Experts 'I:T
Financial Statements (Index) 28
9
9
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRE.
SENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS IN CONNECTION WITH
THE OFFER CONTAINED IN THIS PROSPECTUS AND. IF GIVEN OR MADE, SUCH INFORMATION
OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED. THIS
PROSPECTUS DOES NOT CONSTITUTE AN OFFER IN ANY JURISDICTION TO ANY PERSON TO
WHOM SUCH OFFER WOULD BE UNLAWFUL THEREIN.
1
Page
17
18
18
.. 18
.. 19
.. 19
19
.. 19
.. tAl
III
.. III
Ii
13
.. 13
13 "
lU
fT
fT
1I1
f7
1I1
l1.8
CONDINIID FINANCIAL INFORMATION
Vallo II the mccealor to Variable Annuity LIfe lnIurance ComplllY of Am.riOl,
Wuhlnpm. D. C. ("Vallo wuhlngton"). The CondenJed Flnlllciallnfonnadon
(Per Unit lncome IlId Capital Changes) let forth on page 3, ahoWl the Invlltmlllt
resultl of the Sepanle Account of Vallo Wuhlngton and the Separate Account
through December 31, 1978. for thb aeries of variable retirement anoulty COIl'
lJ?ctI wbich were illUed by Vallo Wuhlngton and Vallo.
I
"1"'1.
N WITH
MATlON
D. THII
ION TO
.
.f"
. ,."
~I ~ ~I~ ~ · ~I ; ! ~ ! ~ ~I ~ i~ i
~ .. ~ """ ~ ~ ~~ J
51 ~ u ! ~ ~ I ~ 3 ~ ~ g ~I jj ~
e ~; ~ 3 ~ ~ ~ 2 ; ~ ; ~ ~ s~ l1
..
~
~
~ ~I~ ~ ~ ~ ~.
I I fJ .. ~ :.. II ] 1s
~ i j $/ ..~ ~I~ ~ ~ 3 ! ; ~ ~ i ~ ~ J! 1 u
i ,I j · ~_ :~'I ; .. ~~ I 11
~ ~ g ~ ~ ~ 5 ~ ~ I ; 9 ~ : ~ ~ d 111 I,
~ ::I ~ .Iii 1.lIs !
I if ~ !' ~I~ ~ ~I ! i 9!1! i il ~I Ii m !
! l! ~I ! ijl. ~ ~I ~II ~ !~I~ il ~II !IIIJ i:1
E ~ Y III .. 'll~ ! ~,8
:-: _ _ 0..,.1
~ ~ gl~ ~ ~ ~ ;. fi ~ ~ ~ ~ ~ it ~:1
.. .. I - - : ~ ... ; : : JI H~
I ! Q ~ ! ~ ~ ~ 9 5 :1 g ~ ~ ;'1 111
gj j"~ .a"d f
J". E~Jljl!El .i'.li_J~l!WJ,. Jdl
WWMi!bfd jfhhdHbJI~ iJ !k~~1
3
B
~
i
1
It
~s
11
,8:5
JI
11
.IS
,I1t
I J
11
,sl
~.
~
, "I
,-
'..
11~
Ii(
1~1
it
~~i
~ -
. ...
~ -
GLOSSARV
Accumulation Period - The period before the com-
mencement of annuity paymenlt, during wblch
purchase Paymenlt arc made on bebalf of
Participants and Net Purchase Payments arc
acaumulated for payment of future annuity benc-
8ts.
Accumulatian Unit - An accounting unit of measure
used to calculate the value of a Partlcipant's
individual account during the Accumulation
Period.
Annuitant _ a retired Participant or bene8ciaT)' who
receives annuity payments.
Annuity _ An ltuuranco contract under which the
ltuunlDce company agrees. In return for the
purchase Payments, to pay a series of payments
to the .,,"nuitant for Ufe; or for Ufe with a mini-
mum number of payments guaranteed; or for the
joint lifetime of the Annuitant and a second
person and thereafter during the remaining life-
time of the survivor. Annuities may be further
clusilled Into two categories: flIed-daUar 1DDUi-
tIa and variable lIIIIIUltles, aach of wblch are
defined below. .
Annuity Period - The period following the com-
mencement of annuity payments to the Annui-
tant.
Annuity Unit - An accounting unit of measure used
to calculate the doUar amount of annuity pay-
ments that will be paid to an Annuitant during
the Annuity Period.
Contract Owner - The employer or other entity ta
which a Group Unit Purchase Contract is bsued;
also referred to as the Owner.
Filed Dollar Annuity - An Annuity providing for
a series of periodio payments which remain flied
as to dollar amount for a certain period through-
out the Illetime 01 the annuitant or annuitants
and which do not vary with investment ex.
perilnce.
General Account - All of the general aneU of Vallc
athlr than those set aside in any Separate Account
of Vallc.
Net Purchase Paymeat - The Purchase PaymOllt
leu sales and administration charges.
Participant - A penon who makes purchase pay-
menlt, or lor whom purchue payments are madl.
under a Group Unit Purchue Contract. and who
hili an interest in the Separate Account by reason
of such coatnbutlons, but who has nat begun to
receive annuity payments.
Purchue PRymenlt - Amouats pald to Valle by or
an behalf of a participant to provide for the
accumulation of Ilxed and/or variable accumula-
tloa units lor immcdlate or later purchue of an
annuity.
The Separate Account - An account establlihed by
Valle punuant to the requirements of the TeOl
lJUurance Code, the usets of wblch are bpt
separlte lrom the other assets al the company,
Net Purchue Payments received lar variable
annuity contracts are invested separately from the
general assets of the Company in the Sepuate
Account.
Variable Annuity - An annuity providing lor a
series of periodlo payments. the dollar amounts
of which wlU Increase or decrease to relIect the
investment experience of the Sepuate Account
throughout the Ufetime of the annuitant or
annuitants.
INTRODUCTION
The baslo oblective 01 the variable annuity
conlrlcts Is to provide participants with Ufetime
benefits at retirement wblch may tend to Idect
changes In the COlt of living both during the yem
prior to and the yem following retirement.
In order ta IccompUsh this objective, Vallo
invests net purchue paymenlJ made under the
variable annuity contracts in the Sepanlll ACCOllllt
as a mldJum for equity investments. primarily com.
,
IDIID stocb. Primarily, iDveslmmts will be made
for lonl.term capital apprecialloD but thiJ does aot
preclude the maldng of occuionalinvestments for
the purpose of seeldogshort-term capital apprecla.
llon. Reallzallon of current income iJ a secclndaty
objective. (See "Investment Objectives, Policies,
and Restrtctions", page 6.) A charge for invest.
mllllt advisary services Lt included In the daily
deduction referred to below.
It iJ anticipated that the value of the invest.
mmts in the Separate Account may, In the long
run, tend to rellect changes In the general price
leveL HLttorically, the value of a dlvenUled port.
folio of common stoclc.s held for a long period of
lime hu tended to rUe during periow of lnJIallon.
There bu, however. been no euet correlation. and
for some periow (such as 1973.;4) prices of com.
mon stockJ bave gone down while the cost of living
was rUing. Further, there can be no assurance
that the experience of the past will continue In the
future.
Many provisions of the typical annuity contract
apply both to variable IIlU1I1lty beaeOts and Oud
doUar annuity beneOts. In both cases, for Instance,
Vallo assumes the mortality and expense rlskJ under
the canltael. A sfgnUlcant d1Herence. however. Is
that for lIIed dollar bene8ts Vallo assumes the
investment rUk by guaranteeing minimum Bxed
rates of annual compound interest and providing
for excess interest credits. However, for variable
beue8lJ the Investment rUk. thlt Lt, the rUk that
the value of the securities held In the Separate
Account may go down. Is borne entirely by the
individual participant.
In assuming the mortality risk, Vallo is taking
the chance that Its actuarial estimate of momllty
rates among annulblDts may prove erroneous, that
iJ. that people will live longer than anticipated
requiring more payments to annuitants. In assum.
inl the expense risk. Valle Is taking the chance
that the expease margins deducted by Vallo mlY
not prove sulBcient to cover the actual sales and
administrative coslJ and contingency requlremenlJ.
If by realon of actual explrlence an error In elti.
mation Lt against Vallo, a 1011 aCCl'Ues to Valle.
Hawever, If by reason of actual experience, an
error In estimatian favors Valle. it may show a
proOl Daily deducllons are made from the Sep.
arate Accaunt Car mortality and expense undertak-
ings at the rate of 1% annually and far investment
advisory services at the rate of ,44% annually on
the Bnt $200.000.000 of asselJ in the Separate
Account, reducing to a rate of .32% annually aa
assets in ncen of S4OO,ooo,ooo. (See "Mortality
and Expense Undertakings and 1avestment Advis-
ory Services," page 9.)
Vallo offen combination contraclJ under which
the participant may elect that a portion of thl aet
purchue payments be applied to provide variable
accumulatloa and variable annuity beneOts. with
the balance being applied to provide lIIed dollar
accumulation and IIIld dollar annuity henelltr.
The participant may change such election from
time to time as to any future net purchue pay-
ments. Additionally, the participant has the right
during the accumulation period to direct the traDJ.
fer of part or all of the accumulated values from
the Separate Account In the General Account or
from the General Account to the Separate Accounl
There will be an charge In the participant for such
transfers.
VALlC AND THE SEPARATE ACCOUNT
The Variable Annuity Life Insurance Company
iJ a stock Ufe insurance company organized under
the laws of the State of Texas as the successor to
Variable Annuity Life Insurance Company of
America ("Valle Washington"), a District of Col.
umbia liCe insurance company which wu organ-
ized In 19M, Vallo iJ engaged primarily In the
offering and issuance of Oxed and variable retire.
ment aanulty contracts and combinations thereof
and Lt licensed to write Ufe Insurance In forty.
ulne states and the Dbtriot of Columbia hut not
Connecticut. and annultles In all Orty states and
the District of Columbia.
Valle Is an Indirect wholly-owoed subsidiary
of American General Insurance Company of HoUl'
IS
Inn, T e:
lnouran,
compan
bUJines
Ammc:
50 otate
in rubsl
acdvitie
lean G,
In man
1918, n.
,
either i
On S
of Vali
lnsuran
"SepIR
IIII\IrIJl
tered Il
ment Of
of 194'
EKcblD
01 mID.
01 the
mluion
On~
bwlnes
SapIRI
femd
time tl
staDdin
Wuhlr,
01 appl
with \I
Aocoun
the Ill'
Undo
the 5el
lIabllitl
Vallo n
the bel
Odarie'
able t,
BnancI
aile.
tOD, Telu. American GenerallJ a 8re and cl1Sllalty
InIUrance company which functions as a holding
company and transacts substantially all of itJ
bwineSl through subsidiaries. Membel1 of the
American General Group operate In each of the
50 Itates and Canada, and collectlvely are engaged
in rub.tantially all fomu of 8nancial services. with
ldivities heavily weiGhted toward insurance. Amer-
Ican General IJ a publicly held corporation. and
to management's knowledge. as of December :11.
1978. no penon owned beneficially :s% or more of
either itJ outstanding common or preferred stack.
On September 25, 1968. the Board of DlrectOI1
of Valle established The Variable Annuity Life
Inrunnce Company Separate Account One (the
'Separate Account") In accordance with the TeKa.!
Insurance Code. The Sepuate Account l.s regis-
tered u a divel1Uled. open-end management Invest-
ment company under the Inve.stment Company Act
of 1940. Registration with the Securities and
Exchange Commission doe.s not Involve .upemlon
of manall.ement or Investment practices or policies
of the Separate Account or of Valle by the Com.
mluion.
,an
w a
Sep.
On May I. 1969. wben Vallb succeeded to the
budDess of Vallo ,Wubingtan, the usetJ In the
Separate Account of Valle Wuhlngton were trans-
ferred to Valle Separate Account One. At that
time the OWOOI1 of and participant.! under out.
standing variable annuity contracts Is.!ued by Valle
Wublngton were credited with the same number
of applicable accumulation unit.! and annuity unit.!
with which they were credited In the Separate
Aocount af Valle Wubington immediately prior to
the succes.slon.
.T
npuy
under
lOr to
II)' of
f Col.
orpn-
In the
retire.
bereof
forty.
ut Dot
.. and
Under the Texu Insurance Cade. the al.et.! of
the Separate Accouat wIl1 not be r.bugeable with
lIabilltie.s arising out of any ather bwlne.s. which
Vallo may conduct, but will be held exclwlvely for
the beneOt af the ownel1, participants and bene.
8ciarie.s of the variable annuity contract.! appllc.
able to the Sepuate Account. The usetJ and
8nandal statements of Vallo which appeu else.
Ildlary
HOWl.
where bereln should be considered only os bearing
upon the ability of Valle to meet Its obUgations
under the variablo annuity contract.!, which Include
death bene8t.! and It.! IlSsumption of the mortality
and expense risk.s,
INVESTMENT OBJECTIVES. POUCIES,
AND RESTRICTIONS
The principal lavestment objectlve of the Sepa.
rate Account Is long.tenn growth of capital through
appreciation and retention and reinvestment af
reallzed capital gains and earned income. ThIs
principal objectlve doe.! Dot preclude the making
of occasional investment.! for the purpose of seeking
sbort.tenn capital appreciation. Realization of cur.
rent Income I.s a secondary obJectlve,
The Separate Account's as.ets will be kept fully
Invested, except to allow the Separate Account to
(I) sell It.! se<:Uritie.! and retain all or part of Its
assets In cuh or cuh equivalents or Invest such
u.etJ In inve.stment grade corporate bond.s. deben.
tures or preferred stack. United States Government
securities. or state or municipal securitie.s, when lD
the opinion of Managlmenl, such actlODl would be
In the Interest of the contract ownen and particl.
pants; (il) Invest mainly In common stocb or .ecuri-
ties coavertible Into common .tocIcs. and (ill) lovest
punuant to the New York Investment restrlctlODl.
The Separate Accouut's wets will be lDve.sted
primarily in a portfaUo of equity securities. mainly
common stacks, divenl8ed among many companies.
Notwithstanding It.! primary growth obJective. the
Sepuate Account may, for defensive purpose.s. tam-
parari1y Invest a luger proportion of Its portfoUo
In high grade preferred stacks and In common
stacks of companies In relatively .table ladwtrles.
Ordinarily, the Sepuate Account will not pur.
chue securities with the Intlntion of enlagi.sll In
sbnrt.tenn trading. However. occulonal loveR-
ments may be made for thl purpose of .eeking
sbort.tenn capital appreciation. Moreover, any pu.
ticulu security wIl1 be sold and the proceeda rein.
vested whenever sucb action l.s deemed prudmt
6
from the viewpoint of the Separate Account's Invest-
ment object1vllf. reglU'dJeu of the holding period
of such lecwity.
The well of the Separate Account will be
Invlllted lubject to the following restrictlOOSI
1. The Separate Account's well may be
Inveoted in secwit1es of one or more registered
Investment compwes, up to a Umlt of 5% of the
value of the Separate Account's usea: provided,
bowever, that no more than 3% of the total out-
standlng voting stock of any ane Investment
company will be acquired. Such investmenll may
be acquired either In the open market or from
dealel'l or uaderwritel'l receivtng the customary
sales loads.
2. Not more than 5% of the value of the
Separate Account's ulllll will be Invested In the
lecwit1es of anyone Issuer.
3. Not more than 10% of the voting secwit1es
of anyone Issuer will be acquired.
.. Invatment will not be made in the secwi-
t1. of a company for the purpose of InBuencing
management or elllrcf.sing control.
II. No borrowlnp will be made.
.
11. Secwitles of other usuen will not be under-
wntten (except In those Instances where the
Separate Account acqulra portfoUo securit1es.
In the aggregate amount of not more than 5%
of the value of the Separate Account's usea.
under circunutances where It will not be free
to sell them without being deemed all under-
writer for the purpnses of the Securit1es Act of
1933 and without regUb'at1on af such securit1es
under that Act).
1. No realatate, commodltles or commodltles
oontractJ will be purchased or sold.
8. Loans will aot be made. but the Separate
Aocount may purcbue periodlcally, In Umited
1DI0unll. sbort.tenn obUgat1ons, such as United
States Treasury bll1J. hankel'l' acceptances and
oommerdal piper.
9. lnvestmena will not be concentrated In par-
t1cular Industries. but up to 25% of the value of
the Separate Account's lIS.ell may be Invested In
anyone Industry.
10. Short sales of securit1es will not be made.
11. Securit1es will not be purchased on mugln,
ezcept for such short.tenn credla as are neceslary
for the clearance of purchllSes and sales of securi-
t1es.
1.2. The Separate Account will aot participate
on a joint. or joint and several, basis In any
lecurit1es tradlng account.
13, No Investment will be made In the com-
mon stocks of any corporat1oa wblch sball have
defaulted In the payment of any debt within Bve
ye,," nert preceding such Investment.
The Investment object1ves, poUcies, and restric-
t10ns described above are fundamental and may
not be changed without authorizat1on of a majority
of the outstandlng variable annuity contract owner
votes.
8111. Inv..tm.nl Law.
The Separate Account Intends to meet appUcable
Investment restrictions imposed under the Insurance
laws of the jurisdlctlons In wblch Valle variable
annult1es are sold. Accordlngly. the Separate
Account (a) will not Invest In the common stock
of anyone Issuer If. lIS a result of the Investment.
the holdinp of the Separate Account. Valle, and
ill Separate Account Two will exceed 5% of the
. oulltandlng common stock of such Issuer. (b) will
nat Invest more than 10% of It.! assell In the securi-
t1es of anyone Issuer (other than securit1es of the
United States Government and It.! agencies), and
(0) will not Invest more than 10% of III aslell at
any tlme In common stocks which do not meet the
criteria for Investments by Ufe Insurance companies
under New York Insurance law. The Separate
Account will be bound by these restrict10ns so long
u they are appUeable under state law.
1
Portlol
Ordlt \
chues
sbort.te
Ity will
ever se
vtewpoi
objectiv.
secwity.
portfoUo
ever, du
or markt
In POrtfl
portfoUo
or sold 0
tumaver
age corr
Account:
Thera
Account I
c
Charges
are weu.
purchue r
Aocount.
..... Ind
A deduct
to OQVllr (I
and other
such Items
employees,
olIIce equip
The amoun
aggregate ~
It-
of
In
Portfolio Turnovlr
Ordinarily, the Separate Account will not pur-
chue securitiel with the IDtention of engaging In
.hort.term trading. However, any particular secur-
Ity will be .old and the proceeds relnve.ted when.
ever such action is deemed prudent from the
vI.wpo\Dt of the Separate Account's Inveltment
objectives. regardles. of the holding period af such
security. It is normally antidpated that the annual
portfoUo tumover rate will not exceed 50%. How-
ever. during any period wben changing economic
or market condltiaDl are antidpated, resultingsbifu
ID portfoUo may stgn1Jlcantly lacreue the rate of
portfoUo tumover (the Ielser of securitiel purchased
ar sold over the value of securities owned). HIgh
turnover IDvolvel correspondingly beavler broker-
age collUlll.Plon expeDles wblch the Separate
Account must pay.
The rate of portfoUo tumover for the Separate
Account for the three preceding yem was:
Y,or Rat.
1918 . 39.2%
11m . . . . . .. . . . . . :W.7%
1978 .. ... . . . . . .. 40,9%
ie.
;In.
1-rY
ui.
ate
illy
,
)m.
ave
Bve
!
:dc-
,
~y
irity
-
able
-
able
nte
toclc
-t,
aDd
. the
wI11
curio
f the
aDd
a at
t the
IIIIIes
ante
long
CHARGES UNDER VARIABLE
ANNUITY CONTRACTS
Charges under the Group Unit purclwe Contract
are UltlSIed ID two ways: u deductloDl from
purchase payments and as charges to the Separate
,\ooount.
Bal.. and OlMr Elpen..'
A deduction is made from each purcbase payment
to cover (l) sales expeDles and (U) administrative
and other expeDlel. Including but not Umlted to,
such Items as salaries of home office offidals and
employees, rent, lega~ actUarial and auditing fees,
oIBce equipment and sundry other office IlptInsel.
The amount of the deduction is bued upan the
aggregate gross purchase paymenll pald ID each
partic:!pant's Individual account. c:oIculated ..
follaw.:
Algr'lal'
GrOl.
Purehas,
poy""lIt.
Ont S 5,000
ae.t S 5.000
next S 5.000 .
aver $15.000 .
D,duction
aso
P,re,IItOI'
of Nit
Purehas,
PoyrnenU
5,26%
4.17%
3,&3%
3,00%
Percent
D,ducf,d
5%
4%
3"1%
3%
ValIc has estimated that of the percentages
deducted. 1.25% is for admJnbttative and other
expenses. and the balance Is for sales expeDles.
Single lump sum payments received by Vallc that
represent amounll accumullted ID plans qual1Bed
under section 400( b) of tbe Internal Revenue Cade.
but not previously accumulated with Valle, shall be
subject to a deduction of 2% to cover (I) sales
expense (,8%) and (U) administrative IIId other
expenses (1.4%). The amount af tbia deduction is
bued on differences ID cost and services wb1ch
VaI1c bu determined to exist ID this type of trans.
action. SlDgle lump .um dIstrlbutioDl that represent
1I1l0unts accumulated la other Valle plans under
section 4OO(b) will be transferred without charge.
Any additional paymenll received after the slDgle
lump sum payment sball be equal to the total pay.
ments less: 5% thereof far the Ont SllOOO of total
purchue paymeats to the partic:!pant's Individual
account. including the slDsle lump sum payment;
4% thereof for the nlxt SllOOO of total payments to
the particiPlllt', IDdlviJual account, lDeludlng the
single lump sum payment; 3.5% for the next S.'lOOO
of total payments to the participant's Individual
account. Including the sinsle lump sum payment;
and 3% thereof for any payments In excess of
$15,000 of total paymenll to the participant's
individual account, Including the slDgle lump sum
payment.
Premium lUes (ranging from zoro to 2.5%) are
deducted from the participant's account at the time
8
aDllulty paymenll begin, when applicable. A State
Pmnlwn Tax Table is contained In Appendix C.
MOff81lly Ind ElpanN Undlrtlklr'gl and
In,..L..."t AdvllOry Senle..
Valle, punuant to an Investment Advi50ry Agree-
ment (":ldvisory agreement") dated May I. 1979
aell as the Investment advi.ler of the Sepanlte
Account. Tbe advisory agreement provides that
Yal1c shall receive a daily fee as compelUation for
the investment advi.lory setvices it renders to the
Sep....te Account, computed at the following
annual raw:
(a) on the first $200 mUlIon of the Account's
nel a.lSet value, .44%;
(b) oa the next $100 milllon of the Account's
net wet value. .40%:
(0) on the next $100 million of the Account's
net anet value. ,36%: and
( d) on the excess over S400 mUllon of the
Account's net uset value. ,32%.
The advisory agreement provides that Valle shall
collect the fee by making a daily deduction. cor-
rerpoad1ng to the four categories described above.
at the ralll of .0012%. .0011%. ,00100/0, and .0009%
of the Account's current net uset value for that
day, ValIc alsa provides mortality and ellpelUe
underta1dngs under ill variable annuity contracll.
For such underta1dngs. Vallc will make a daily
deduction from the Separate Account of .00274%
(l.(IO% on an annual basu-.85% for mortality
underta1dngs, and .15% far expense undertakings)
. of the current value of the Separate Account.
A. Mortality and Expln.. Undlrtaklngl
While variable annuity payments will reOect the
In_tment performance of the Separate Account.
they wt1l not be sHected by adverse mortaUty
experience or by the excess in Vallo's expenses
over the expeD.le deduction.s provided In the con-
tract. Vallo llJIwnes the risk that III actuarial esti.
malll of mortality among :lnnultanll may prove
erroneow (that is, that the Ufe ellpectancles of
annultanll may be langer than anticlpated), and
that the reserves established on the buis of such
estimate may not he sulBcient to meet annuity pay.
ment ohllgatiolU. Valio provides an expln.se under.
ta1dng by uswnillg the risk that deduction.s for
marketing, administrative, and other lervlces may
not be sulBclent to cover the actual COlts of these
items. The amounl.l deducted by Val10 from the
Separate Account in 1976, 197i. and 1978 for mor-
tality and ellpense undertakings were $2.115,20Cl,
$2.008,744, and $1,900,605, respectively.
B. Invlltmlnt AdvllOry Slnlc..
In perfonning Investment advi.lory services, Vallc
malces and executes Investment decisiolU for the
Separate Account. For providing such services,
Valle wlU nuUce a daily deduction described above
from the current value of the Separate Account.
The amouna 10 deducted for 1976, 1977, and 1978
are $930,690. $897,047. and $878,504, respectively.
Tbe terms of the iavestment advisary agreement
provide that it may be continued only so long u
the Board of Managen of the Separate Account or
the majority of the outstanding variable annuity
contract votes speciJlcally approve its continua-
tion, on at leut an annual basil. and, in either
event, including a majority of the "non.interested"
members of the Baard IdentiBed euewhere herein.
The Board of Managers, a majority of the oubtand-
ing variable contracts votes, or Valle can lennlnate
the agreement at :lilY time upon not more than 60
days'. nor less than :JO days' written noticel however.
Vallo cnnnot exercise that right unless the coatract
holders and Board of Managers have approved a
new advisory agreement with another party. The
contruct tenninato.t automatically In the event of
Ib assignment.
of tl
Vall<
avail
actio
Aceo
milsl
and
vices
the p
the s,
the I'
transl
anoth
Oed b
Sub
and \I
Accou
Mil
to the
matio,
broker
actiOll>
the Ix
does n
the cl
eOlllld,
orden
market
price
anothe.
Vall,
Variabl
ante.
which,
lar to S,
may fn
u the
cate, el
Sepmt
are mB
Separat.
the me
are mae
arate ;
C. Alloelllon ot Brok.rlg.
M the Investment advisor to the Slp....te
Account, Vallc ha.s the responsibility for placing
orden for the purchase and sale of securtties for
the Separate Account's portfolio and the selectian
9
Iallc
the
Ices,
:lOve
lunt.
19i1l
Iy.
nent
I. U
at or
lu1ty
bwa.
(ther
ated"
1niD.
tand.
illate
IDOO
lever,
llnct
fed a
The
nt of
larate
laci.n I
.. for
acUaD
of the brokers to handle such trllWactions. It Is
Vallc's policy to obtain the best security price
available with respect ta each particular trans'
action, and In so doing, It wtIl place Separate
Account brokerage buslnell and negotiate com'
mission rates In accordance with the reUablUty
and quallty of a broker's portfoUo eucutlon ser.
vices and their value and expected contribution to
the perfonnance al the Separate Account. Thus,
the service COlt or commission which is added to
the security price to produce the total cost of the
transaction may be higher than that charged by
another broker If the dlHerence is rea.sonably jwti.
6ed by the quaUty 01 service offered.
Subject to that Ilrst and overriding consideration.
and with the prior authorization 01 the Separate
Account's Board of Managers of appropriate poli.
ctes and procedures, Valic may give consideration
to the fumishlng 01 statistical data, research Infor'
motion, and related services by broken In selecting
broken to execute the SeparMe Account's trans.
actions. Vallc will e~erctse Its discretion In seeldng
the best inlonnation and research available lUId
does not consider that tbere is an obligation to get
the cheapest execution regardless 01 qualltative
considerations, In over.the.counter transactions
orders will be pl~ed directly with the principal
market maker unless It is beUeved that a better
price and e~ecutlon can be obtained by wing
another broker.
Vallo wo acts as Investment adviser to The
Variable Annuity Life Insurance Company Sep-
arate Account Two ("Separate Account Twa")
which, becawe Its Investment objectives are simi-
lar to Separale Account One's Investment oblectives,
may from time to time hold the same securities
u the Separate Account. VaUo attempl.l to alia-
elite, equitably, partfolio trllWactions among the
Separale Accounts whenever concurrent decisions
are made to purcha.se or sell securities by the
Separate Account and Separate Account Two. To
the exleat purcha.ses or sales of the same security
are made at the same time, the price of the Sep-
arate Account's securities could be adversely
affected althaugh, with a combined transaction,
the Separate Account could beneSt from a lower
commission rate. However, In the opinion of Valle,
the results 01 such procedure wtI~ on the whole, be
in the best Interests 01 each account.
No speciSo value can be detennlned for thl
retean:h and statistical material furnisbed by
brokers, without cost to Valle. It may tend to
beneSt the Separate Account by Improving the
quallty of advice, Reports of commissions paid,
Including those which reSect services furnished In
addition to e~ecution, are presented to the Sep.
arate Account's Board of Manalers. VaUo stands
ready to docum8llt that nil tran.sactions were
placed In the good faith beUef that they would
tend ta beneSt the Separate Account. In 1976 and
1977, brokerage commisslon.s In the amounts of
$630,542 and S287,1I45, respectively, were paid from
the Separate Account. During 19711, WlO,5IlO wa.s
paid from the Separate Account as brokerage com-
missions, Such transactions were handled by 28
brokerage 6rms. ApprOldmately 57.00/0 of total com.
missions Incurred by the Separate Account wftre
placed with brokers who provided reseuch or
stat\.stlcal material to Vallc.
THE GROUP UNIT PURCHA'.
VARIABLE ANNUITY CONTRACT
The Group Unit Purchue Contract is designed
and offered for (I) mnulty purchue plans adopted
by publlc school systems and certain tax elOmpt
organizations punuant to Section 403 { b) of the
Code, includlag optional retirement programs for
employees 01 certnln state-supported educational
Institutions; and (II) employee pension and proSt.
sharing plans qua1l8ed under Section 401 of the
Code, including plans establlshed under the Self.
Employed Individuals Tax Retirement Act of 111611
("\l,R. 10"). Such qualUled plnn.s provide spec\ll
tax deferred tJeatment ta participating employea
and self-employed individuals and their benefici-
aries. (See "Federal Tax Status", page 18.)
An employer which is a slate, city or oounty, or
any agency, authority, or lmtrUlllental1ty thereof,
10
may purchUI a Group Unit PurchlUu Contract in
cannection with a "non.qualI8cd" deferred com.
penlltioa plan establuhed pursuant to tho Internal
Revenue Code and any applicable state law. A
deferred comperuation plan is a contractual
ISTIIIgement between an employer and lll1 emplayee
wbereln the Imployer makes an unsecured promise
to pay the employee compensation at soml rt1pu.
lated future date for services currently rendered b)'
the employee, Typlca.lly, the contract cnlls for the
employer to pay an employee speciJled or variable
amaunlJ for a certain period or for life &her retire.
ment or duabillty, or to hu bene8clary In event 01
death prior to retirement. In such ClUe, all rights
under the contract are owned exclusively by the
employer, who Is the contract owner, and 311 lunw
becoming payable under the tenr.s of the contract
1ft payable 10, and the exclusive property 01, the
oontract owner. No certiIlcates are usued to any
employee with whom the contract owner hlU
catered Into a deferred comperuatian agreement.
Such an employee U referred to In such coatract IU
a "Partlclpant" solely for the purpose of estahluh!ng
a method of recording allocations applicable to each
lDdlvidual emplayco's account. Such an employee
hu DO elective rigblJ under the contract. AIIlndl-
vidual accounlJ represent the aet value of the con.
tract owner's Interest In the contract,
The Group Unlt Purchue Contract iJ Issued to
the contract owner and coven all partlcipants, each
of whom (except Participants In Deferred Compen.
sadon Plaru) receives a certiIlcate which summar.
izeI the proviJlaru of the muter group contract and
evtdences partlcipation. An ladlvldual accumula-
tilllllCCOunt u established for each participant, and
purcbue payments &hlr deductions for sales and
od"'ln1otrative IxpeMes are held In the Separate
Aooaunt and credited ta the participant's account,
Subject to the provlslans of the plan. PUrchUI
paymenlJ on behalf of a participant may be sw-
pended at any time, and If the Individual account
hu not beln redeemed, the purchase paymenlJ may
be resumed at any time dUring any subsequent
tuable year of the particIpant.
Th. WlD'ances under the Group Unit PurcIw.
Conlr1lct apply for the lifetime 01 a partlcip&llt for
purchue paymenlJ at an annual rat. of up to 200%
of the amolUlt of lint Y04J' IlW'Cluu. paymenlJ mad.
on lilt behalf. Vallo may modify the Group Unit
Purcluue Contract (except where modUloation u
prohibited by the (nveslment Camp4lly Act of
1001) with respect to such IUsurance5 for thot.
purchue payments In excess of such amount after
the effective date of the modlllClltfon.
The contract provides that the 8nt monthly pay-
ment to an annuitant will be c3lculaled on the
martllllly and inlerest basis used In delennlnlag
rales far Immediale annullles then being usued by
Vallc for this dus of annuitant, rather than on the
buu shown la the coatract, If such detennlnation
will produce greater blne8lJ for the participant.
ACCUMULATION PERIOD
Owing the period before the commencement
of annuity payments, elIch purchue payment, after
deductioru for sales, aclmlnJJtratfve and other ax.
ptnJes, u credited to the contract in the fonn of
accumuJatfon unilJ. Th. number of accumulat10n
unilJ credited u detennlned by dlvldlog the amount
credited by the value af an accumulation unit on
the day an which the purchue payment is re-
ceived and the application hlU been accepted at
the Home Office of Valle, If received prior to the
close of trading on the New York Stock Exchange,
and by the value computed u of the close af the
Exchange an the next lndlng day, If received
thereafter, By mutual agreement, purchue pay.
menlJ may be considered to have been received
for the risk of the partjcipant when actually reo
celved al the Home Office of the Company,
The number of accumulation units sv credited
will not be changed by any sublequeat change
In the value of an accumulation unlt, but the
dallar value of an accumulation unit may vary
from day ta day depending upon the InVetlment
experience of the Separate Account.
11
1/;;';'"
-,.
TI
on C ,
is de'
value
ment
perio
ticlpa
by m.
oulsta
currer
cumu;
with
Sepan
such
menu.
Eacl
chaagl
rale u
anee c
the Sl
capital
reallzac
of the
ceding
11 deteJ
ment n
uselJo
atIon p'
taldnp
and an)'
are cun
SlDce
the oom
the Iovr
IDvestmf
net love
the aeet
1011 than
An lilt
lDveslmel
Iation un
contalnec
Table
uperienc
pay-
n the
Unlng
eel by
m the
aation
ant.
The accumulation unit wu establUhed at $1.00
on December 31, 1960, l11ld for subsequent perlow
Is detennlned by multiplying the accumulation unit
value for the previow period by the aet invest.
mllllt factor (described below) [or the curreat
period. The value of the contract and of a par.
ticipant's account can be detennined at any time
by multiplying the number of accumulation units
oulltandlng under the contract ar account by the
cumnt accumulation unit value. During the ac.
cumulatioa penod, the value of the controct varies
with the perfonnance of the invesbnents of the
Separate Account, and there is no usurnnee that
such vlLluo will equal ar exceed purchue pay.
mena.
Each day on which the :-l ew York Stock Ex.
change is open for trodlng, a gross Investment
rate iJ detennlned from the invesbnent perfonn.
anee of the Separate Account. Such rate Is (l)
the Separate Account's invesbneat income and
capital gains and loues, whether realized or un.
realized. on such day, divided by (11) the value
of the Separate Account for the Immediately pre.
ceding day. The net invesbnent rate for any day
II detennlned by deducting from the gross invest.
ment rate ,00094% (ranging down \0 .00064% on
wets over $400,000,000) for each day of the valu-
ation period (see "Mortallty and Expense Under.
t:aldngs and Investment AdviJory Services', page 9)
and any applicable Income taxes (no Income taxes
are cumntly payable on qualified plan usets).
Since the net invesbneat rate may be negative if
the combined capital losses and deductions exceed
the Invesbnent income and capltlLl gains, the net
Invesbnlnt factor (which ls equal to 1 plus the
net Invesbnent rate) may be less than 1.00 and
the accumulation unit value, therefore, may be
less than the value for the previaus period.
An illwtration showing computation of the aet
invesbnent factor and calculation of a new accumu-
lation unit value, using a hypothetical example, is
contained In Appendix A,
Table I, Appendix B, indicates the Investmeat
experience of a net purchue payment of $100.00
made In September, 1968. This table indicates the
vlLlue uf such a net paymeat at the end of each
quarter up to and including December 31, 1978,
The Investment perfonnWlce hu been detennined
on the buls of the Separate Account of Valic
Wuhington and the Valic Separate Account.
Purchl" Wmnl
The maximum and minimum purchase payments
which can be made by the contract owner are the
amounts colled for under the plan. However, mini-
mum initial and subsequent monthly purchue pay.
ments per partlcipant are S25, if the purchue pay.
mena are to be olIocated entirely to the Separate
Account, and are SJO (with S12 minimum allocated
to the Separate Account) If they are in part for
the purchase of a &xed annuity, The company may
waive the mlnlmum purchue requirement!, on a
fair and equitable buls, for plaw establUhed for
employers with 500 ar more employees,
With regard ta Plaw quaUJled under Sect10n 401
of the Code, the inltial annual purchase payments
under the Plan generally mwt be at leut S2,OOO,
with subJequent annual purchase payments of at
leut $5,000.
ConftnnlUon of Tranuctlonl
Within 8ve bwlness days after the end of each
calendar quarter, Valic will send to each partlci-
pant (or ta the employer or adminiJtrator In
deferred comperuation plaw) a quarterly statement
coatalnlng information u to all activity In the par-
ticipant's accouat for the previow quarter, including
purchase payments, partllLl wlthdrawaIJ, trawfer
af values and redemptions: the datllS of each such
transaction; the number of units credited or
deducted from a partlcipant's account In each trans-
action: the sales and adminlstrative charges
deducted from the gross amount of each payment;
and the account balances at the end of the period.
Including the cash value thereof. New participanu
will be sent a l'OnJlnnation upon receipt of the 8nt
payment on their accounts, and quarterly state.
menu thereafter.
12
Puttal Radlmpllon
Upon wrllten request to VaIlc at Its Home Olllce
at any time before annuity paymentJ begin. a par.
ticlpant (the Joinder of the contract owner II
required under contractJ bsued in coanect1on with
optional relil'ement programs for employees of
certaln state.supported educational institutions).
may receive part of the value of hiJ individual
account. A partial redemption will result In the
cancellation of a proportionate number of accumu.
latlon unItJ credited to the participant's Individual
account. Receipt by a participant of a partial
redemptloa is subject to the requirement that, after
each such payment, there mwt be a minimum num.
ber of 30 accumuletlon units remalnlng In his indi.
vidual account. The amounts of any redemption
may not be repaid.
Termination (Radlmpllon) Valul
At any lime before annuity payments begin (and
upon the joinder of the contract owner which is
required under contracts issued In coanect1on with
optional retirement progrlll\U far employees of cer.
tain state.supported educatloaal institutions). a
participant or a beneficiary for whom an accumu.
latlon account iJ malnialned may elect to redeem
the value of hiJ individual account, in accordance
with the foUowlng options I
(a) A participant (if at leut SO years of age) or
beDeflclary may elect to bave hiJ iDdivldual
account valued and, after deduction of any
appUcable premium taxes, appUed to provide
fixed or variable annuity paymeDa, or a
combination thereof, commeDclng on the
lint day of the month immediately follow.
Ing the expiration of 30 days from the date
wrllten nollllcatlon is received at the Home
Olllce of the Company, according to a select.
ed annuity aption. For a description of avail.
able annuity options, see "Varlablo Annuity
Options., page 16.
(h) A particlplnt or beneOciary may elect to
pennanently Ivlthdraw and receive In cuh
all of the tennlnatioa value of hiJ Individual
account by submluloa of a wrllten request
for withdrawal together with his certillcate
to VaUo at Its Home Olllce, In the case 01
a participant, such tennlnatlon value b
equal to the value of the accwnulatioD units
standing ta hiJ credit computed as of the
Delt valuation of accumulation unitJ foUow.
lag receipt by VaUc at its Home OIBce of
the withdrawal request. [D the ClUe of a
beneficiary, the termlDation value l.s deter.
mined lU of the date of delth of the par.
tlclpant. (See "Death BeneBt Before Retire.
ment", page 14.) For tax consequences of
such termination payments, see "Federal Tax
StaluJ", page 18.
(0) A participant or beaeBclary may elect to
pennlt hiJ Individual account to remain in
force under the CODtract, in which event
the account will partlclpate in the invest.
meDt results af the Separate Account and/or
Interest earnings of the GeDeral Account. as
appropJiate. Upon the selected annuity com.
meDcemeDt date, the partlcipant or bene.
Bciary will begin to receive annuity pay.
mena according to a selected annuity aptian.
At any time pJior thereto, he may IllOt to
receive in cuh thl tennlDatlon value of hil
individual account, u descrlbed in para.
gnaph (b), above.
(d) A participant or beneBciary may elect to
have aU or any part of the lennlnatlon value
of hiJ individual account transferred with.
out the 5% deduction for salel and admlu.
!stration expenses la VaUc's geDeral accouut
or from the geneml account 10 the Separate
AccouDt upan submissian of the appropriate
wrllten request to VaIlc at itJ Home OlBee.
(e) Upon llrmlnation of participation In the
plan a participant may elect to have hiJ In.
dlvldual account valued and applied to the
purchue of an Individual Variable Annuity
Contract of a type then being IPued by
r
r
t
t
I
t
\
(
n
t!
tl
If
C
oJ
a.
n
v
tl
01
Q(
tr
13
VaUc for thlJ clan of annuitant. Such
electtan may be made without the Impoll.
tion of any charge, and in the opinion of
Vallc'. coumel, without any advOl1e till
comequence. to the participant. Future
purchue paymenlJ, if made, will not be
rubfect to tho llIX beneBlJ of Section 403( b )
of the Code, 3IId will be subject to the
charge. and deductiom described in the
PI1l'pecluJ punuant to which Individual
Variablo Annuity ConlraclJ are thea being
offered.
(f) If a particlpant become. an employee of
another employer which I. the owner of a
similar Group Uatt Purchase Contract IlIued
by VaUe, the participant may elect to have
hi. individual account trans felTed to .uch
other contract, without the Imposition of
any charge.
The tennlnation value of an individual account
may be more or lell than the value of the purcbue
paymenlJ made and applled ta provide accumula-
tion unll1 for the account, depending on whether
the aggregate value of the participant'. account hu
increased or deaeased in the intervening period.
All paymentJ of, tennlnation values due under
the contractJ will he made within seven days after
Vallo receive. such written request at Its Home
OlBce, However, paymentJ of tennination values
may be suspended (I) during any period In which
the New York Stock Exchange I. clo.ed (other
than cwtomary weekend or hoUday closings), (U)
In the evoat that tbe Securities and Exchange
Commission detennlnes that trading on such eK-
chang. Is restricted or that an emergency emts
as a result of which the Separate Account may
not reuonably dI.pose of Its securities or fairly
value ItJ as.etJ, or (Ill) far sucb other periaw as
the Securitilll and Exchange Commission may by
order direct for the protection of variable annuity
contract ownen and participants under such con-
lnctJ.
...
D.lth S.n.m Sl'orl Retirement
If a participant die. durin~ the period prior to
the commencement of annUIty paymentJ, there will
be lU1 iUllount payable upoa such dlath equal to
the greater af: (l) the tennlnation value of the
participant'. Individual account at the date of
death I or (II) 100% of aU purchase payments
made under the contract by or on behalf of the
participant, reduced by any withdrawals.
The beneficlary will be paid the death benefit
after notice and due proof of death of the partici-
pant Is received by ValIc at Its home olBee. The
beneficiary may elect to receive the delth benefit
either In one lump .um or under any of the V lliable
Annuity Options, (See "Variable Annuity Options",
page 16). A beneBclary has 60 days from tbe date
he ar she is Brst entitled to receive the values
payable as a result of the death of the Partici-
pant to IlTevocably elect to receive the proceeds
In the fonn of annuity paymentJ. Should the bene-
ficiary fail to elect an Immediate or defelTed annuity
option within the 60 day period, the entire account
balance will become payable to the designated
beneficiary or beneficiarles In accordance with the
temu of the Contract.
InlUII Wllhdrewll Ind Rlfund
Each participant .hall have the right for a period
of 45 day. (commencing with the date of the eltO-
cution of his Individual appUcation) to sUlTender
hJs certificate of participation under the Group
Unit Purchue Contract and to receive In cash the
value of his account plus the amount equal to the
difference between the grOIl purchase payments
made on his bebalf and the net amount of .uch
purchase paymentJ Invested in the Separate
Account. '
ANNUITY PERIOD
For Group Unit Purchase Contract:J Is.ued for
plaas quaUlled under Section 403(b) of the Code,
the annuity date I. wually elected in the appU.
cation at the time of Inue, subject to later changes
14
by the participant, and can be the flnt day of any
month between the annuitant'. 50th and 75th birth.
days.
All Group Unlt Purchue ContrlCtl limed for
plans qualllled under Section 401 of the Code pro.
vide for annuity payments to commlnce at such
time as specilled In the plan.
The amount af the llnt monthly annuity pay-
ment 11 detennined on the buls .et forth in the
plan and the Progressive Annuity Table with
Interest at the rate of 3J,i% per annum, as.umlng
births in the year 1900, contained In the Group Unit
Purchase Contract. The amount of each payment
will depend upon the sel of the annuitant and the
annuitant'. ad/wted age at the lime the lint pay.
ment 11 dUI, where adJwted age shall be
determined In IIl.'COrdance with the followlngl
ClIlIndDr Y.ar Adiusted Ag. II
af Birth Actual All'
Befqre 1901 . . . . . . . . plus 1
1901-1915
1916-11lGlS
1936-191l5
191'f6.1976
.
minus 1
minus 2
minus 3
Actual Age, lI.I wed above, shall mean age nearest
the birthday at the time the lint payment II due.
The amount of the lint monthly payment will be
detennined by the value of the participant'. indi-
vidual account as of the tenth day immediately
preoedJng the date annuity paymenIJ commence,
leu any applicable premium taxes, and by the
unulty purchase rates contained In the contract.
The annuity purchaJe rates show the amount
aecenary to provide a monthly retirement benellt
of n, The rates vary with the form of annuity
..Iected, the date of birth and sel of the annuitant
and of the contingent annuitant, If any.
The amount af the lint manthly variable annuity
payment detennined as above, Is divided by the
annuity unit value calculated ten days prior to the
dale of the 8nt monthly payment, to determine
the number of nnnuity units represented by the
payment, and the number of such unltl rerna/OJ
Ilxed during the anaulty period. In any subsequent
month, the dollar amount af the variable annuity
paymeat II detennlned by multiplying this constant
numblr of annuity units by the then annuity unit
value, ClIlculated lI.I set forth in the aell succeeding
paragraph, for the tenth day preceding the date on
which the variable annuity payment llto be made.
However, any premiuml not received and credited
prior to the valuatioa date (I.e. the tenth day priar
to the end of the month) may not be applied
to purchll.lo an immediate annuity, but will be
refunded.
The annuity unit value for the month of
February, 1961, wu established at $1.00. Valle
began daily pricing of the annuity unlt value on
May 10, 1972, and the annuity unlt value on that
date Wll.l 1.:184088. The annuity unit value for any
date II determined by multiplying the annuity value
for the immediately preceding date by the net
investment factor (see. Accumulation Period", plge
11) for the date for which the annuity unit value
II being calculated. In order to avoid the credJtlng
of "double interest", the result II then multlplled by
a factor to neutralize the lI.IIUJJ\ed net investment
rate built Into the annuity table contained in the
contract.
inllSl
AuulT
initial
Auum
after .
VllIlmI
menlS
The
to pre
the Ie
inere&>
remIts
pradu,
will do
lI.IIUJJ\p
Separa '
Rate d
paymel
than tl
the ae
equal I
Rate, -
Table I
on a 3~
Anil
eumpl
unit va.
ments
Auumld InvHlmant Rate
Vallo will permit each annuitant to select an
Assumed Investment Rate permitted by slate law
or regulatlolU other than the 3J,i% rate described
in this Pl'llIpectus as folloWlI 4J,i%, 5% ar 6%,
The foregoing Anumed In vestment nates are wed
merely In order ta dltennlne the lint monthly
payment per thowand dollars of value. It should
oot be Inferred that such rates will bear any rela.
tlonshlp to the actual net Investment elp8rience
of the Separate Account
The choice of the Assumed Investment Rate
affect! the pattern of annuity payments, A higher
Auumed Investment Rale will produce a higher
Initial payment. but a more slowly rising series
of subsequent paymenl.l (or a more rapidly fall.
Tabl,
interval
which \.
wumln
paymen
and thl
mbsequ
the but
01 Vall,
Hthe
ba VII an
to provi'
annuity,
of the i:
vide a E
lIS
lag series of sulmquent puymeats) than a lower
Assumed Investment Rate. Although a IUgher
Initial paymeat would be received under a IUgher
Assumed Investment Rate. there is a polat in time
after which payments Wlder a lower Anumed In.
vertment Rate would be greater, usumlng pay.
mentJ contiaue through that point in time.
The objective of a variable annuity conlnct Is
to provide level paymeats dunng perlodJ wben
the economy Is relatively stable and to reBect u
Increued paymentJ only the elcess investment
resultJ Bowing from InBation ar an Increue In
productivity. The achievement of this objective
will depend ia part upan the valldlty of the
lWWllptiOns that the net lavestment rate of the
Separate Account equals the Assumed Investment
Rate during periods of stable prices. Subsequent
payments ,viII be smaller than, equal to or graater
than the Bnt payment depending upon whether
the actual net investment ralll Is smaller than,
equal to or greater than the Assumed Investment
Rale. The variable annuity paymentJ indlcated in
Table II, Appeadix B, of this Prospectus lIl'll based
on a 3~ % Assumed Investment Rate.
An lIIlUtration showing, by lUe of a hypothetical
ewnple, the method of detennlnlng the annuity
unit value and the amount of monthly annuity pay.
mentJ Is contalned In Appendix A.
Table II, Appendix B, lndlcates at quarterly
lntervals the monthly variable annuity payments
which would have baen received by an annuitant,
wumlng that an Initial monthly variable annuity
payment of $100.00 was made In November. 1968,
and that the Investment experience reBected In
subsequent monthly payments was detennlned on
the buls of the InvestmentJ of the Separate Account
of Valle Wuhlngton and the Separate Account.
U the plan so pennltJ, the annuitant may elect to
have any portion of his lndlvidual account appUed
to provide either a variable alUluity or a lIxed da11ar
annuity, or a combination of both. That portion
of the Indlvldual account wlUch Is appUed to pro-
vide a lIxed dollar annuity will be withdrawn from
the Separate Account and thereafter will not par-
ticipate in the Investment experience of the Sep-
arate Account. The electian of a lIxed dollar lID-
aulty is subject to the conditions that Ii) such
election must be received by Vallc at least ana
month prior ta the annuity commeacemeat date,
and (H) the fint payment provided under thl
variable and the lIxed dollar annuity mlUt each be
at leut $2.5.00.
Varl.bl. Annuity OpUon.
The annuitant Is generally given the option of
I'llCelving annuity paymlntJ ia accordance with
anyone of the following variable annuity options.
If the retirement plan so provides, some of the
options listed below may be elcluded. The "Level
PaymentJ Varying Annually' may be used In com.
blnation with any of the Bve variable annuity op.
tions. Uader all of the options, except for the
fint and fourth, upon the annuitant's death his
beaeBclary can, with respect to any beneBts pay.
able, receive such beneBtJ Wlder any of the Bve
options. Once lUIIIuity payments have commenced,
the election of an option Is Irrevocable.
If the annuitant doll.l aot specify one af the fol.
lowing options at the time he becomes eligible
for retirement annuity psymentJ, variable annuity
paymentJ are made In accordance with the SIO'
and Option with payments being guaranteed for
a ten year period, except in those CIIIes In which
a joint and survivor annuity pay-out Is required by
law.
Any right af commutation punuant to the an.
nulty OptiolU below shall be calculated on the
buu of thl same interest rate lUed to calculalll
the original annuity paymentJ,
Y: F/m Opt",n - Lif. AnnuUv. Variable Annuity pay.
ments are payable during the Uletime af the annui-
taut, and the annuity terminates with the lut
payment preceding death. ThIs option allan the
mulmum amount of variable annuity payments
since there u ao provilloa for a death beneBt for
beneBciaries. It would be polllble under this option
16
for the lIIIlullant to receive only one lIIIIIulty pay.
Dlent It he died priar 10 the dale of the lecond
payment, two It h, died before the third annuity
payment dale, etc,
SIC0n4 Option - Llf. AnnullV wuh 00, 1~ or 180
MonthlV l'aVrrllflll Clrlain, Variable AnnuJty pay.
UIInb are made monthly during the ~fellme af an
lIIIIIuitanl WIth the provUo that, if the annuitanl
diet dwing the certala period, the beneSclary may
receive monthly payments for the remainder of
the certain period IUId at any time dwing IUch
period may Ilect to receive in one lum the present
value of thl remaining paymenb, calculated on
the buis of the lame Assumed Investmenl Rate
used to calculale the original annuity paymenb,
Third apI/on - Unit Rrfund Lif. AnnuUv. Vari-
able AnnuJty paymenb are payable monthly duro
Ing the lifetime of the annuJtant with an additional
payment 10 the beneBclary at the death of the
lIIIluJlant equal 10 the excen, If any, of (a) mlnw
(b) IImll the annuJty unit value, where (a) lJ
the total amount app~ed undlr the option (or
the lota1 employee conbibution) dividld by the
lDDuJty UI'Jt value for the date on wbJch annuJty
payment.s commence, and (b) is the number of the
lDDuJty units represeated by each monthly pay.
ment multiplied by the number of monthly pay-
menb made,
For example, if under a Group UaJI Purchase
Contract $10,000 were applied under this annuJty
form for a male al ad/wled age 6.'l on the annuJty
date, the annulty unit value on IUch date wu $1.50,
the number of annulty uaJts represenled by each
'lDDuJty paymlat wu 40,71 (since the amount of
the lint annuity payment would be $61.06), len
lDDuJty payment.s were paid prior la the date of
daeth, and thl value of an annulty uaU on the
date of the annuitant's death wu $1.60, the amount
paid to the beneSciary wauld be $10,015.31, com.
puted as follows,
{ flO,ooo }
1.50 - (40.71 X 10) X $1.60 = $10,015.31
-4 Founh Opl/on -Iolnl and Lilli Surv/lIOI' LIt.
Annu/tv, Variable ,\DnuJty paymenll are payable
during the joint lIfetlmll.l of two annuitants and
continue dwing the lifetime of the lurvlving IlU1U.
itant, ThlJ option lJ dlligned primarily for cou.
plll.l who require muimum poSllble vuiable IlU1U.
Ity payment.s during their loint IIVlls and who are
aot concerned wilh providiag for beneSclaries at
the death of the lasl to survive.
FIfth apI/on - Paf/lllftlll for D.lignat.d P.riod.
Variable payment.s are paid monthly for a selected
number of yean between one and 8fteen. At any
time dwing such period thl AnnuJtant may elect
to receive In one sum the presenl value of the
remaining paymenb, calculated on the bulJ of an
Interest rate per annum equal to that rate wed 10
calculate the Annuitant's Brst annulty payment.
Uader the Federal tax lawl, the election of this
option may be !relted In the same mlDDer u a
lurrender of the participant's lotal account. U an
employee's Individual Account lJ sUlTeadered, wu-
ally the full amount recelvrd would be Includible
in Income for that year, and, to the enent so In.
c1uded, would be taxed al ordinary rates, lubject
to possible beneSt.s af the income aVllraging pro-
visions of the Codl.
Level Pevment8 Verylnll AnnueUv
Th. level payment series Is an a1ternallve mode
of payment wbJch lJ wed oaly In combination with
ane of the preceding variable annuJty options.
Uader this Plan, annuity paymenb are made
monthly during each annuity year at a level
detennlned for thai year bued on the Investment
performance of the Slparate Account,
The amount of the anaual variable annuity pay.
ment shall b. detennlned ia the lime manner u
moathly vuiable annulty paymenlJ except that
annual rather than montbly purchase rates are
UJed. The amount of thls Bnt annual variable
annuity payment lJ divided by the then annuJty
unit value to determine the number of lDDuity
unit.s In each subsequent annual variable lDDuJty
payment. In any annuity year, the dollar amaunt af
17
mod.
with
the annual variable annuity payment Is detennlned
by multiply/ag this constant number of annuity
units by the then annuity unit value.
The amount of lach certllin monthly payment
during a givln lIII1Iuity year shall be no less than
the annual variable lIII1Iuity payment otherwise
payable times ,OIl46M, which includes an laterest
element of 3~%. This factor may be changed at
the sole discretion of Valle to refiect an earned
IDtemt rate of greater than 3~%.
Any IDterest actually earned by Valle which
exceeds the IDterest rate with which the certain
monthly payments are detennined will accrue to
the surplus of Valle.
U an annuItant dies prior to receIving all twelve
payments during any oae lIII1Iuity year, the pay.
ments remaining during that annuity year will be
paid either to his estate or to the named bene-
ficiary.
ASSIGNMENT
Unless permitted by applicable law, assignment
of CI'OIIP Unit Purchase Conll'acts Is prohibited.
PlDIRAL TAX STATUS OF THI COMPANY
Vallo II tau<! as a life Insurancu company under
Part I rub-chapter L of the Internal Revenue Code
of 11154 (the .Code"). The opel1ltions of the Sep-
arate Account fonn a put of, and are taxed with,
the operations of Vallc. Therefore, Vallo will be
liable for IIDY laXes which will become payable
with respect to the Separate Account. For Group
Unit Purchase Conll'acts Issued In connection with
annuity pun:base plans quaWled under Section
403(b) of the Code, IIDd pension IIDd profit.sharing
p1anJ qua11Jled under Section 401 of the Code,
under eidstlng FederalIDcome tax laws, IDvestment
lDcome (IDclud1ng capital galns) taken IDto account
ID detenn1nlng the value of accumulation units
and annuity units lor such contracts Is not taxed.
Vallo will allocate to such Group Unit Purchase
Contracts any Federal, State or other w liability
which may result ID the future from maintenance
of the Separate Acoount or such Group Unit Pur-
chue Contracts applicable thereto. To the best of
Vallo's knowledge, there Is no current prospect
of llIIY such liability.
With respect to Croup Unit Purdwe Contncts
issued In connectioa with non-qua11Jled deferred
compensation plans, under eurrent law, no Item of
dividend or Interest Income and no unreaI1zed
capital galns will be wed. but realized capital
gains will be taxed.
Valle will establish and maintain a reserve
within the Separate Account for payment of tales
on net realized capital gains, u well as a reserve
lor potential wes for unrealized capital gains,
attributable to contracts which do not qualify for
special tax.deferred treatment. These reserves are
cu.rrently calculated on the bull of 28% of the
gain. Therefore, 1lII Increase In net realized or net
unrealized capital galas of the Sepe.rate Account
will result in an Increase of the reserves by the
amount of the potential tales, and a decrease ID
net realized or net unrealized capital gains of the
Sepe.rate Account will r...ult ID a decrease ID the
reserves by the amount of the reduction of poten-
tial tal liability. The reserve for paymllllt of tues
on net realized capItal gains will be transfemd to
Vallo's glllleral assets even If Valle by reuon of
realized capItal losses from other operations pays
no capital gains tax.
Convenely, If the Separate Account bu net
realized capital losses, the potenllal deductions
associated with such loss... will be carried lorward
IDdellnltely IIDd used until exbawted to offset
amounts which would otherwise be transferred to
Valle's general assets lor the taxes on subsequent
realized capital galns In the Separate Account. The
Separate Account will not maintain a negative
reserve for net unrealized capltal1ossn,
FEDERAL TAX STATUS OF PARTICIPANTS
It should be recosnIzed that tbe folio....
deteription 1a this Protpectus of the Fedenl '-
tu rtatw of amounlJ received und.. Group UDlt
I
I I
! i
-I'
'. r
I
I
I
;
18
-
l'uIdwe contracll II DOt ahawtive &Dd does not ." subject to ponible beneSts from the Income averag.
purport ID CIOYer all dtuallooa. A quaU8ed tax ..' Ing proYiJloll.l of the Code.
adrlla' Ihou1d 1M COIIIIIIted for complet. lnfOI'Dll' . '-
doa. Qu.llned Plnllon Ind Prolll.8hlring Pllnt
CIenIrII Purchue paymlnts made by an employer In
ICOOrdance with a pell.llon or pro8t.sbwg plan
qualiJled under Section 401 of the Code are exclud.
Ible from the gron Income of the employee,
Should a qual18ed pell.llon or pro8t.sbaring trult
or a quall8ed annuity plan 1011 Its qualJ.8catioD or,
In cue of a trult, its tax exemption. emplaYdet
could be required ta Include In groll Income the
purchue payments made by employers, and they
could aho lose some af the other tu beneSts
described In th1J Prolpectus.
Th. contraclJ offered by th1J ProlpectUJ are 000'
ridered aDDulty ooatrrctJ tuable UDder Section 72
of the Code. When aDDulty payments blgln, the
fullllllount of the payments will generally be tued
u ordinuy lacome. However, the Participant may
1M In a lower tu braclcet after retirement due to
lower Income, greater deductloll.l, or both. U pur.
chue payments bave beeD made other than on a
tu-deferred buIJ, a ratable portion of each annu.
Ity payment may be excluded from grOSI Income.
UpoD sumtnder of a contract In whole or ID part,
the full amount received will generally be tued
u ordinary IDcome, subject to possible bene8ts
rwu1t1ng from the Income averaglDg proYiJloll.l of
the Code.
Fwther IwormatioD reganl1ng Federal lncome
tuatlon of certain qual18ed retirement plans II pro.
vlded below.
.
IIotIon _(b) Tu.DeMrred Annuity Contracta
Th. Internal Revenue Service hu beld ID private
rulings that the Group Unit Purchue CODtract
qual181!1 u an annuity contract under Section
403(b) of the Code. UDder Section 403(b) of the
Cod., purchue payments are made by public
scbooll}'ltemland tuollempt organlzatioll.l, meet.
Ing the requiremeDlJ of SectiOD 50 1 ( 0)( 3) of the
Code, for aDDulty contraclJ for their employees.
Such lIIIaUDts are excludible from the gross Income
of the employee to the extent that the aggregate
purchue payments for the emplayee do nat exceed
the exclUlion allowance provided In SectiOll.l 403
(b)(2) and 415 of the Cod..
II a partial or full surrender af the contract Is
made by the Participant prior to the commence.
ment of annuity beneSts, generally the full amouat
of the payment will be tuable 1.1 ordlnuy Income
leuer 01
Addltinn
dedUcdb
1lll000t
earned t
lribution:
oonlribul
Code.
Th. C,
blbit pal
attained
death or
before ag
Code. H
Under present law if an employee (or bII
beDeSclary) receives a lump IUID dlstributioD, 1.1
deSned In the Code. from an eAempt employees'
truI!, the taxable portion of the distribution may be
taxed UDder a special elective ten.yell lnoome-
averaging proYiJion. In the alternative, the lOable
portion attributable ID yean of service before 11114
may be treated 1.1 long-term capital gain, with the
remainder taxed under the Ipecla\ Ilective ten.year
lnoome-averaglng provllion. However, ao part of a
lump lum distribution will be tued In the yell af
distribution if, within 80 days of receipt, an
employee tramfen all property received (leiS the
amounts oomtdered contributed by him) to another
exempt emplayee's trult ar to individual retirement
accounts, annuities or bonwl.l provided for under
the Code.
SI".Employed IndlYldulll ("H.R.10")
Under the "H.R. 10" provillon of the Code, self.
employed individuals are allawed to estab\llh quail.
Sed pell.llon and proSt-sharing lruJtJ and annuity
plam. The emploYles of such persoll.l Ile treated
1.1 described under the Immediately preceding
beading.
Deductlble employer contributioll.l on behalf of
self.employed persoll.l generally mlY not exceed the
19
ral.
or,
oy.-
" the
~they
rdts
1
ala
of
~an
i-the
~
u.nent
r llllCier
~,..If. .
Ih quail.
lDDulty
I traated
..ILIIIlI
~af
UlIId the
I..." of 15 perceot of earned Income or S'T,500.
AddlllClll&lly, tbe plao may permit voluotuy nOD.
deducllble purch..e paymentJ by putlclpantt In an
amount not to Illoeed the IlIler of 10 pel'Olllt of
euned Inoome or $2.500. Excesl voluntary OlIn.
tribullOlll by owner/employ- and 11011I employer
OOIItrlbullOlll IIIll lubject to peoalllll under the
Code.
The Code require. that H.R. 10 p1aol mwt pro-
hibit payment to owner' employ- prior to an
attained age of 50 '" (other than In the llVIDt of
death or tatal disability) and such dbtribudoDl
before a.. 59'" II'1l subject to peoaltilll under the
Code. However an OWIIII'I employee and othen
'10
may withdraw voluntary aondeducllble purchase
paymentJ at any time.
In other mpectJ, lelf-employed lodlviduab and
their benellclariet are generally treated .. described
under the immediately pre<:edlog heading.
OTHIR VARIABLE ANNUITY CONTRACTS
10 addlllOD to Group UDit Purcbue Cootradl.
Vallo otJen Iodlvidualand ptlDIlon Trust variable
Annuity CootractJ and ather Group Variable An.
nuity Cootractl.
'I'hese oontractl II'1l described In IIIIl olferad
punuant to separate prDIpICtUMI-
go
Prlnaltlll 011I<<*1 (Othlr TIIln Dll'lClto..) 01 V.11e
NOmf
POlitlon
WU1Iam H. Guamlere
Roy G. HannlIon
David D. Knoll
Edward J. Murphy
Leonanl M. RIchards
Vice Presldent.AdsnJniIttation
Vice President and Treuurer
Vice Pmldenl, General Counsel and Secretary
Vice PresIdent and Direolllr 01 Marketing Services
Vice Presldent- Portfolio Maupr
Unlat otMrwin noted, the oddreu of the ab01Hl Indlviduall II 'Jl'Jl Allin Parkwav. HOUlton. TIXOI 77019.
RIlTIUlllflltion 01 thl BOlrd 01 Mlnlgl"
IIllI Clrtlln AIlIUll1d PeIlO'"
Vallo Is responsible lor payment 01 the lees and
upeDSes of the Members of the Board 01 Managen
who are not alBUated persons of Valle; however,
Memben of the Board 01 Managen who are also
afB11ated with Vallo will not be entitled to any lee.
All other expenses lor services relative to the
operalion of the Separate Account are paid by
Vallo, lor wbicl11t deducts certain amounlJ from
purdwe paymenlJ of oontract ownen (see "Sales
and Other Expenses' page 8) and from the Separ-
ate Account (see "Mortality and Expense Undertak-
iIIp and Investment Advisory Services", palle 9).
Aaregate direct remuneration to all Memben of
the Boud 01 Managen Is not anticipated to exceed
$12,000 during the current &seal year. Last year's
remuneration W1I.I $12,000.
VOTING RIGHTS
Conlrllct owners have the right to vote at any
annual or speclal meeting upon I
1, Election 01 memben 01 the Board al Man.
agen,
2. Removal of any member 01 the Board of
Managen or any omcer elected or appoillted
by the Board of Managen.
3. Rat1Jlcatiou of the selection, or termination
of employment 01 iIIdependent auditon.
4. Approval 01 an initial or amended apUlent
lor illvestment advisory services, approval of
oontinuance of the agreement or term1nalion
of the agreement.
5. Approval 01 an initial or amended psiJlcipal
underwriting agreelDllnt and 01 oontlnuanoe
01 the agreement In the absence of approval
01 such initial or amended agreement or III
oontinuance hy the Board of Manalen or
tennlnation of the agreement.
6. Changes In the lundamentAllnvestment objec-
tives and policies 01 the Separate Ac:count.
The number of votes wbich a contract owner
may cut ill the accumulation period Is equal to
one VOle per dollar 01 the daUu value of the
aocumulation unIlJ attnbutable to his contract. In '
the annuity period each contract owner may cut
the number 01 votes equal to the aggreglte dollar
value 01 the useb malata1ned ill the Separate
Ac:count to meet the annuity obllgatlnns IDIder
his variabll annuity contract. Generally, a oon-
tract owner ill the annuity period wil1, over a
period of time. have a decreuing number of YOteI
u the reserves maintained to meet thOIt annuity
obligations become diminished.
23
~Itlon
h.
i
,
Inneot
~.of
r-oo
I
!nepal
~
I" or Ita
\en or
,
OWlIer
plto
of the
'lCt.1n
IY cut
. doIlu
epuate
I llllder
I con.
0_ I
of wtu
lIIIIulty
Each plrtlclpant under a Qual!Jled Contract
ahaII be Iwnilhed all prol)' mlterials. Each par.
tlapant Ihlll hive the riabt to give lIutructlOIU
lor the voting 01 thole votu Ittrlbutable either ta
bit Indlvidull account or to the amount al well
eatabl1lhed In the Separlte Account to meet the
lIlIlulty obUgatiolU to him, 111 IppUcable.
Contract owners Ihall cut the votes lor wblch
IDltnlctions hIve been received lrom pll11apanll
In accordance with such lIutructloDl. Votes lor
which iostnlCtlOIU bave not been received from
pll11c1pantl shall be cast by the contract ownen
In the alIlnnatlve or the negative In the same pro-
portlalU u thole votes lor which hutructiolU have
been received
The number 01 votes ta be cut by each coatract
owner or put1dpant having the right to vote shall
be detennined by the Board 01 Manlgers u af
a record date within 90 day. of the day of the
NGfM and Principal
BUliMII Addr",
John J. Plumb
'l1't1 Allen Plrkway
Howton, Tl. 77019
meeting, and at Ill1IIt 10 dlYs wriltell notlce of
the meeting will be given, To be eotlt1ed to vote,
a contract owner or voting pll11cipant must hive
been a contract owner or pll11c1pant 00 the record
date.
DISTRIBUTION OF VARIABLI
ANNUITY CONTRACTS
Variable lIlIlulty cootncll will be sold primarily
by lIuurance agentl 01, or broken lor, Vallo who
have been Ucell.led by the ltate iosll/'lllCO depart.
mentl. In addltlon, these penoos lor the most
part will be regiltered representatives of Tbe
Variable Annuity Marketing Company ("Vamoo"),
which tJ wholly-owned by Vallo, and tJ I member
of the Natloaal AJJocIatlon 01 Securities Dellen,
Inc. ("NASD"). Vamco Is the principal under.
writer for the Sepll1lte Account. The d1recton or
08lcen of Vamoo who are alIlUlted with Vallo are
u 101l0wsI
POIitI01II with VaUc
and
Th, Separat, Aeeotlnt
President and Director, Vallo. President, Sepll1lte A.ocount.
PontloN with
Varneo
Chainnan of the
Board 01
DIrecfon and
Presidlnt
Director and
Vice PresideDt
Vice PrelideDt and DIrector of Marketing ServlOOI, Vallo.
Director and
Vice President
Vice Plelident. General Counsel and Secretuy, Vallo. Vice
President and Secretary, Separate ACCllUnt.
Vice Prelident
Vice Pres1dent.Admlnlstration, Vallo. Vice Pretident, Sepante
Account.
Dranch Manager, Vallo.
.
District Manager Branch Manlser, VaIlo.
..
Edward J. Murphy
'lm Allen Parkway
Howtoa, Tl. 77019
David D. Knoll
2727 Allen Plrkway
HOUJtOa, Tl. 77019
WU1lam H. Guamlere
2727 Allen Parkway
Howton, Tl. 77019
Todd Adams Djltrict Manlger
6800 France Ave" South
Suite ;90
Edina. Ma. M435
(612) 927-8494
Larry Andenon
5620 Waterbury Way
Suite A.204
SaIt Lake Clly.
Ut. &U21
(801) 27fl.4743
NafM and princlpal
BllIiMu Add"",
POIi/ionl wllh
Vamco
POIi'""" with Vallo
and
T h. SIJIIlI'llf' Account
j
I
I
j
I
I
I
i
I
I
I
EruIIt L. Jordan. Jr.
l'rrT Borel Place
Suite 3H
SID Mateo, Ca. 1M402
(4111) 574~
Tbomu N. Lange
740i North S6th St.
B\4 300, Suite 380
T~a. Fl. 33617
(813) 965./1585
Aldm D. Lewil
1618 S. W. Flnt Ave.
Suite 316
part1and. Or. 97201
(1lO3)223-6288
Chari.. J. Mluteln
2 William St.
Suite 304
White Plain., N.Y. 10601
(914) 948-1555
Robert A. Obelter Vice PresIdent Regional Maoaaer, Valle,
2110 South POIt Oak Rd.
Suite 400
HoultOn, TK. 77056
(713) 821-6314
F. WIWam Scott
33lI Baker Avenue
Coacord. ML 01742-
(617) :J89.&'lOO
Donald R. VanPutten
lronpte Executive
Plui IV
777 S. YlITOw, #217
Llkewood. Co. 80228
(303) 988..1344
Robert M. Wood
26'55 Villa Creek Blvd.
Suite 250
DalIu, TKo 75234
(214) 620-2642
Cherlotte A. Robinson Secretary
?:T?:T Allen Parkway
Howton, TK. 77019
Joe C. O.bome
?:T27 Allen Parkway
Howton, TK. 77019
Variable annuity contractJ may also be .old throu&h other broker-dealen whOle representatives ue author.
Ized by appUcable law to seU variable annuity contractl,
lIlI
Vice presideat
Regional Maoager, Valle.
Vice President
Regional Maoaaer, Valle,
Vice President
Regional Maoaaer, Valle.
DIstrict MlDager Branch Manager, Valle.
Vice Presld.nt
Regional Maoaau, Valle,
Vice PresIdent
Regional Maoaa.r, Valle.
Vice president
Regional MlDaau, Valle.
,
Law Department Sta1f para1epl, Valle.
Treuurer
Director of CODlervation IDd Product Deve1opment, Valle.
SAFEKEEPING OF SECURInES
The .ecuritiel and other investmenll of the Sepa.
rate Acoount are held by Telll Commerce Bank
National Auociatlon, 712 Main Street. HoUlton.
TIllU, under a .afekeeping agreement with the
Separate Account.
STATE REGULATION
Vallo iJ subject to the laWl of TIllII governing
lIle inJurance companies and to regulation by the
Telll Commissioner of Insurance. An annual
.tatement, In a pl'lllcrlbed fonn, is Bled with the
Commissioner on or before March 1st of each year
covering the operations of Vallo for the preceding
year and {Ill Bnanelal condition on December 31st
of such year. IIlI boob and IIsm are subject to
review and examination by the Commissioner at all
tlmel, and a full eumlnatian of III operations is
conducted by the National Association of Insurance
Conun1uioneI1 at least once every three yem.
In addition, Vallo is subject to the inJurance law.
and regulations of the other jurisdictions in which
.
It II Ucensed to do bwines.. Generally, the insur.
ance departmenu of such furisdlctlolU apply the
law. af TIllII In detennlnlng permissible invest.
menll for VaIIc.
f
LEGAL PROCEEDINGS
There are no material legal proceeding. pending
to which vaUo Is a party.
LEGAL OPINIONS
Legal malten In coanectlon with the variable
annuity contractJ offered hereby bave been pwed
upon by David D. Knoll, Vice President, General
Counse~ and Secretary of Valle.
~
1
EXPERTS
The Bnanela1 statemenlll Included in thiJ Prot.
pectus and the Registration Statement have been
eWIIlned by Ernst & Ernst, Independent audllon,
to the extent set forth in their reportJ, and are
included herein In reliance upon such reportJ given
on the authority of said audltan U lllpertI In
accounting and auditing.
rr
VA 3142
.
THE VARIABLE ANNUITY LIFE INSURANCE COMPANY
UNITS OF INTEREST UNDER
INDIVIDUAL VARIABLE ANNUITY CONTRACTS
SEPARATE ACCOUNT A
.
. -
The Individual Varilble Annuily ConlraCIS (the program under section 401 (including H,R. 10
"Contracts") olTered by The Variable Annuity Life l'lans) or seclian 403(a) of the Code,
Insurance Company (the "Company") in connection (Iii) An individual, or an employer for an
with this prospectus arc designed primarily for use individual, who qualifies 10 contribute to an
with retirement programs which receive favorable Individual Retiremenl Account (an "IRA") pur.
tax deferred treatment under Federal income ta~ suant to section 408 of the Code,
law. This tax deferred treatment may resull from
the fact that Purchase Payments for the Contract (iv) A public employer pursuant to an
arc being made by one of the following: unfunded deferred compensation program under
section 457 of the Code.
(l) Certain private tax e~empt organizations
or public educational institutions for the benefit of For information on the tax consequences to
employees pursuant to sectlan 403(b) of the Individuals see "Federal Ta~ Mailers", p. 17,
Internal Revenue Code of 1954, as amended (the The Campa ny's e~ecutlve office is located at 2727
"Code"),
Allen Parkway, Houstan, Te~as 77019; Its mailing
(II) An employer, for the benefit of an address is p, O. Do~ 3206, Houston, Te~as 77253;
employee In conjunction with an employee benefit and i1stelephone number is (713) 526.5251.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE
ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS
IN CONNECTION WITH THE OFFER CONTAINED IN THIS PROSPECTUS, AND IF
GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE
RELIED UPON AS HAVING BEEN AUTHORIZED. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER IN ANY JURISDICTION TO ANY PERSON TO WHOM SUCH
OFFER WOULD BE UNLAWFUL THEREIN.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS, ANY REPRESENTA-
TION TO THE CONTRARY IS A CRIMINAL OFFENSE.
To be v.lld Ihl. pro.peclu. mu,' be .ccomp.nled by a pro.peclu. 01 American General High
Yield Accumulation Fund, Inc" Amerlc.n General Money Markat Fund. Inc., American General Equity
Accumulallon Fund, Inc" or American General C.pllal Accumulation Fund. Inc.
.~
Plelle read and ralaln thl. pro.pectua lor lulure rl/erlncl.
The d.le or thIs prOlptCluJ I, Seplember 17, 198%,
TABLI OF CONTlNT8
PI.'
Definitions ............." . . . . . . . . , . . . . 3
Introduction. . . . . . . . . . . . . . . , . . . , . , . , . . . 4
Tho Company and the Separate Account. , . . 6
Transfen Amonl Divisions of the Separate
Account ........,............,...." 8
The Funds .. . . . , . . . , . . . , , , , . . . , , . . , . . . 8
Types of Variable Annuity Contracla . . , , . 10
Charlcs Under Variable Annuity ContraclI II
Charle for Premium Taxes. . . . , . , , , , II
Charle for Partial and Total
Surrenders, . . . . , , , , . . . . , . , . . . . . . II
Charle for Annual Contract
Maintenance ,.,.,..,.,....,..,.. 12
Charle to the Separate Accouat . . . , , 12
Miscelllneous, . , , . , . , .. . . . . , . .. . , , . 12
Accumulation Period ".,..,.....,...... 12
Death Benefill Durinl Accumuiallon
Period. . . . . , , , .. . , . . , ..., . . .. " . 13
Suspension of Purchase Paymenla . , . . 13
Annuity Period ,.."....,..".... .. .. , , 13
Assumed Invcstment Rate"" . . . , . , , 13
Fixed or Variable Annuity Paymentl 14
Amount of Annuity Payments ,.."" 14
Annuity Payment Options. , , , . , . , . . . 15
Death of Annuitant Prior to Annuity
Period. , , . . , . . , . , . .. , , .., . . , " . . 16
Death of Annuitant Durlnl Anauity
Period, , . , . . . , , . , . '. . , . . . , . , .., , 16
Surrender. , . . . . . . , , . . , . , . . . , , . , . . . , . . . 17
Other Contract Features....,.....,..... 18
Assilnment. . . , . . . . . . . . . . . . , , . , . , . . 18
Cantract Owners, Annuitanll and
Beneficiaries.. .. . .. .. .. .... . . .. .. 18
PI.'
Annuity Date.. ... .. ..... .. ......., 18
Federal Tax Mailers ................... 18
General, . .., . . ... . " .. . . . . ". . , . . . 18
Taxes Payable by the Funds. the
Company and Ihe Separate Account 19
Taxes Payable by Policyholders. . . . , , 19
(I) Section 40J(b) Annuities for
Employccs of Certain Tax
Exempt Organizations or Public
Educationlllnstilutions. . . . , . . 19
(II) Section 401 Qualified Pension,
Profit Sharinl or Annuity Plans
(includlnl H.R.IO Plans) ...,. 20
(Ill) Individual Retirement Annuities 21
(Iv) Section 457 Public Employer
Unfunded Deferred
Compensation Plans, . , . . , , , . . 22
Manllement ,."""....,..,...,....,. 22
Votinl Rllhts ..............,.......... 25
Reservation of Rights.. . . .. , . .. , , .. . . , . . 26
Texaa State Optional Retirement Program 26
Distribution of Variable Annuity Contracla 26
Reports to Contract Owners. , . . , . . . . , , . , 27
State Regulation. , . . . . . . . , . , . , , , , . , . . . , 27
Experla , . . , , , . . . . , . . . , . , , . . . , . , , . . . . . . 27
Further Information, .. .. , .. , .. , . .. .. .. . 27
Financial Stalements . I .. , . . .. . , . .. .. .. . 28
Appendix A . . .. . .. . .. " , .. .. .. , .. .. , .. 41
Appendix B ., . , . . . , . . . . . . . . . , . . . . . . . , , 43
Appendix C . . . . . . . . . . . , , . . , , . . . . . . . . . . 44
2
.
19
19
DEFINITIONS
Aeeumula,lo., Ptrlod -the period between the date af the fint Purchale Payment for a Vlrilble
Annuity Contract and the Annuity Date.
Aecumulal/on Vnll - an Interest of a Can tract Owner In a Dlvlllon of the Separate Account before
Annuity Paymeall begin. The value of an Accumulatlan Unit will vary In proportion to the net Invcstment
return of the respeclive Dlvlllon of the Seplrate Account. (See Appendix A, Example I, p, 41 for an example
of calculation of Accumulation Unit value.)
Aeeumula,lon Valut -- the Accumulation Value of a Contract on any given date II equllto the sum of
the General Account value and the Separate Account value under the Contract,
Annul/an'-the person to whom Annuity Payments arc or will be made.
Annul/y Dalt - the date on which Anauity Paymenll begin,
Annul/y Opllon - one of several forms In which Annuity Payments can be made.
Annully Paymtnu - payments made by the Compaay to an Annuitant at regular Intervals during the
Annuity Period.
Annul/y Ptrlod -the period during which Annuity Payments arc made.
Annul/y Unll- a measuring unit used In calculating the amount of Annuity Plyments, The value of an
Annuity Unit will chaage In accordance with the net Investment return of the Divisions selected, adjulted for
the Contract's H'I% Assumed Investment Rate, (See Appendix A, Example S, p. 42 for an example of Annuity
Unit value,)
Assumtd lnvtstmtn, Ratt -the rate used to determine the fint monthly Annuity Payment per thouaand
dollarl of Accumulation Value, The Company will permit each Annuitant to select an Allumed 1avcstment
Rate permilled by state law or regulations other than the H'I% rate described in this prospectua as followl:
411I%, S% or 6%, Unless otherwise selected, the Allumed Investment Rate shall equal H'I% and the informalian
herein is based on that rate.
Stntfielary -the penon to whom benefits, if any, will be paid upon the death of an Annuitant, Includlal
Iny contingent Beneficiary, I,t" one who Itandl In the place of a Beneficiary In the event af the primary
BeneficlarY'1 death,
Conlrae, - an Individual Variable Annuity Contract offered by this prospectus,
COn/roel Owntr -the person or entity to whom a Cantract Is issued. Unless otherwise provided in an
Ippllcatlon, the Contract Owner is the Annuitant. Two Contract Owners may be dcslgnated al co-ownen when
the Contract is issued pursuant to an em player's retirement program. When co-ownership is dcslgnated the
rights vested in the Cantra~t Owner mull be jointly exercised,
COn/rael Ytar - a 12 month period beginning with the date of issue of a Contract, and any aaniveraary of
that date.
Divisions of tht Stpara't Aeeoun'-the Individual subaccounts into which the Separate Account II
~.vlded and to which Net Purchase Payments and accumulated values may be allocated under a Variable
Annuity Contract,
FIXtd Annul/y - a serics of Annuity Paymentlta the Annuitant made at regular Intervals which remain
fixed throughout the Annuity Period and which do not vary with investment experience.
Fund - a mutual fund which is the underlying Investment medium for Net Purchaoe Payments credited
ta a Dlvillon of the Separate Account.
Gtntral Accoun/-the BlIets of the Company other than those in the Separate Accouat or any other
leparate account. Reservel for any Fixed Annuity arc maintained In the Oeneral Account.
Homt OjJiet -the Home Office of the Company shall mean ill main office located at 2727 Allen
Parkway, Houston, Texas 77019.
Nt' Purehast Paymtnr -the tatal amount of a Purchase Payment lesl any applicable premium taxCl.
(See "Charge for Premium Taxes", p, 11.)
Pal'
18
18
18
19
20
21
22
22
25
26
26
26
27d27
27
27
28
41
43
44
3
PurchGJt Pa,'mtnt- an amount paid to the Company prior to any premium tax or ather deductlonl,
SIparatt Account - the sesresated auet account referred to as Separate Account A which was estab.
IIlhed by the Company under the Texas Insurance Code to receive and invest Net Purchase Paymentl made
under Variable Annuity Contracts.
Sur"ndtr Chargl -the contlnsent deferred sales charse assessed asalnSl certain withdrawals of
Accumulation Units, or the election of a lump.sum payment under the firth Annuity Option durinS the
Annuity Period, where Purchase Payments have been made durlns the precedlns three Contract Years.
Sur"ndtr Valut -the Accumulation Value of a Contract less the Surrender Charse, If any.
Varlablt Annuity - a series of Annuity PaymenlS, the amounts af which will Increase or decrease to
reneet the net Investment experience of a Dlvision(s) of the Separate Account.
Varlablt Annuity Contract - a Cantract provldlns for the payment of a Variable Aanuity,
INTRODUCTION
1. WHAT 18 THE BASIC OBJECTIVE OF THE CONTRACTS?
The ContraclS arc deslsned to provide individuals with retirement benefits throush the accumulation of
Net Purchase Paymenls on a fixed or variable basis, and by the application of such accumulations to provide
Fixed or Variable Annuity paymenlS. As discussed under Questions 2 and 3 below, variable ac:c:umulltions and
Variable Annuity paymenlS arc based on performance of the Fund or Funds selected in connection with a
Contract. It Is the purpose of professional manasement of the Funds' securities ponfolios to provide returns to
investors which would offset or exceed the effects of innation. There is. however, no suarantce that this
objective will In fact be achieved, The optlan to choose amons Funds Is Intended to provide a purchaser with
more than one me1ns with which to allempt to cape with Innltlon,
2. WHAT 18 THE DIFFERENCE BETWEEN FIXED AND VARIABLE PAYMENTS?
Fixed Annuity paymenlS arc monthly payments from the Company to an individual, the amount of which
il fixed and suaranteed by the Company, The amount of the monthly payments will depead only on the form of
Annuity Payment chosen. the ase and sex of the Annullant, and the total Accumulation Value applied to
purchase the annuity.
Variable Annuity paymenlS arc similar ta Fixed Annuity payments, except that the amouat of each
monthly payment from the Company will vary renectlns the nel investment return of each Division of the
Separate Account In which the Net Purchase PaymenlS are accumulated. If the net Investment return for a
siven month, after all charses summarized in Question 9. below, exceeds the Assumed Investment Rate (3~%
unless a different rate is selected), the monthly payment will be sreater than the previous payment. If the net
investment return for a month is less Ihan such Assumed Investment Rate, the monthly payment will be less
than the previous monlhly payment.
3. HOW ARE NET PURCHASE PAYMENTS ACCUMULATED?
Net Purchase Payments will be accumulated on a fixed or variable basis until the Annuity Dlte, (See
"Accumulation Period", p. 12.) Net Purchase PaymenlS under anyone Contract will, at the election of the
Contract Owner, be deposited in up ta three Divisions of the Separate Account, or two Divisions of the
Separate Account and the General Account. Those paymenlS allocated to the Separate Account will be applied
to purchase shares of the mutual funds as chosen by the Can tract Owner In which such Divisions of the
Separate Account Invest. As Ihe value of the Investmentl In the Funds Increases or decreases, the value of
ac:c:umullted Net Purchase PaymenlS will Increase or decreale, The value of accumulated Net Purchase
Payments is subject to deductions for chlrses as summlrized in Question 9, below.
4. IS THERE A SALES CHARGE'i'
A sales charse Is not deducted at the time a Purchase Payment is mlde. However, a Surrender Charsoamay be messed for a partial or total surrender, or upon the electbn of a lump-sum payment durins the
4
Charle
rinlthe
Annuity Period under the fifth Annuity Option, dependinl on the lenlth of time the Contract hll been In force.
(See "Chlrle for Partlll and Total Surrenders", p. II, for Infarmatlon about the Surrender Chlrle,)
a. IS THERE A MINIMUM INVESTMENT?
The Initial and subsequent Purchase Payments for a periodic payment Contract mUlt be at least 530. This
minimum applies separately ta the amount of each Purchase Payment directed 10 each Division of the Separate
Account or the General Account. For slnlle payment Contracts the minimum purchalC payment is 51,000 per
Coatract. However, thll minimum may be waived where one purchaser, such al an employer, purchllcs a
number of these Contracts. If the Accumulation Value of a Contract falll below 5300, the Company, at III
option, may cause Ihe Contract to be automatically surrendered, in which calC, a Surrender Charle may be
deducted from the amount paid to the Contract Owner. (See Question 4.)
e, MAY THE CONTRACT BE SURRENDERED AT ANY TIME?
The Contract Owner may make a total or partill surrender of the Contract at any time durinl the
Accumulation Period by livinl wrinen requcst to the Company, (See "Surrender", p. 17.) The Contract must
be returned to the Company before a tOlalsurrcnder can be effected. A Surrender Charge mlY be allcued.
(See Qucstlon 4,)
7. MAY TRANSFERS OF ACCUMULATED VALUES BE MADE?
Durlnc the Accumulation Period, a Contract Owner may transfer all or part of accumulated Can tract
valucs amonl Divislonl of the Separate Account or to the General Account once every 30 daYI. After a trlnsfer
is made to the General Account, at least 90 daYI must elapse before any subsequent transfer from the Generll
Ac:c:ount wlll be permitted,
Durinlthe Annuity Period, aa Annuitant may transfer all or part of accumulated Coatract valucs Imonl
Divisions af the Separate Account or to the General Account once every 365 day', Transfers from the General
Ac:c:ount durinlthe Annuity Period arc not permitted, Transfers arc notsubjeclto any charle, (See "Transfers
amanl Dlvllions of the Separate Ac:c:ount", p. 8, for additional conditionl relarding transfers.)
The transfer privilele may be sUlpended or terminated at any time.
e. CAN BOTH FIXED AND VARIABU! ANNUITY PAYMENTS BE PROVIDED UNDER ONE
CONTRACT?
Ycs. At retirement, the accumullted value lenerated by the Net Purchase Payments mlY, at the
Annuitant's option, be applied to purchlle any combination of Fixed and/or Variable Annultlcs, subject to the
Company's minimum Annuity Payment requirements for anyone annuity form, (See "Annuity Payment
Options", p. IS,) Up to three Divisions of the Separate Account or two Divisions of the Separate Accaunt and
the General Ac:c:ount may be selected,
e. WHAT OTHER CHARGES ARE MADE IN CONNECTION WITH THI! CONTRACTS?
An annual chlrle, which il currently 530, but may be increased or dccrealed, il assessed each Contract on
the 1111 day of the calendlr quarter in which the first Purchase Payment is made and thereafter annually on
that date throulhoutthe Accumulation Period for adminillratlve expensel with respect to each Contrlct; a
daily chlrle at an annual rate of 1% of the averale dally net asset value of the Separate Account allocable to a
Contract Is Imposed for certain additional expenlel and for assumption by the Company of mortality rllu: and
In certlln statco a deduction for premium tuesls made. (See "Charles Under Variable Annuity ContrlclI",
1" II.)
A dally charle based on a percentale of averale daily net assetsls plid by each Fund to III Invcstment
advller for Investment manalement, which charlco arc borne Indirectly by the Separate Account. These
charlcs arc more fully described under "The Funds", p. 8.
11111 prOlpeclUl dtlcrlbtl only lhe ,arlable upedl of lba Conlrull, unpt ..hera Rxed upectJ an
lpeclRcally mentioned,
luctions.
'IS estab.
~II made
Iwall of
rial the
'ean.
~ease to
1atian of
I provide
ilonslnd
h with a
Itumsta
[hit this
\ler with
I
i
!
Jf which
\ form of
I
'Plied to
. of each
n of the
1m for a
te(3Yl%
f the net
I be ICI.\
Ite. (See
n of the
I of the
I applied
I of the
vllue of
'orchlle
5
THE COMPANY AND THE SEPARATE ACCOUNT
The Company II a I\ock life insurance company
or.anlzcd under the lawl of the Stale of TelDl al
tbe lucccuor to Variable Annuity Life (nlurance
Company of America, a Dlllrict of Calumbla life
inlurance company which wal organized in 1955,
The Company il englged primarily in Ihe olfering
and luuance of 6xed and variable retirement
annuity contracll and combinalianl Ihereof and il
lleenled to write life Insurance ia all stales (other
than Connecticut) and the Dillricl of Columbia, and
annuities In all 6rty slatel and the District of
Columbia. The IsseiS and 6nancial statements of the
Company should be considered only II bearing upon
the abl1lty of the Company ta meet ill obligations
under the Contracll, which include death bene6tl
and ill luumption of mortality and expense riso,
Namt and
Addrtss 01
Btntficla
~
Fayez Sar06m
2 Houltoa Center,
Suite 2907
Houston, TUII
TexII Commerce
Bancahares, Inc.
712 Main Street
Houston, TexII
Fayez Sar06m
2 Houl\on Center,
Suite 2907
Houston, Texas
Liberty Nalional
Life Insurance Company
2001 Third Avenue South
Birmingham, Alabama
Tlllt of Class
Common Stock . , , . . . . .
Convertible.. . .. , . . . .. .
Junior Preferred Stock,
Sorlel of 1980
Junior Preferred Stock. .
9110% Serlel of 1979
The Compaay is an indirectly wholly.owned lub.
Ildlary of American Oeneral Corporation (formerly
American Oenerallnsurancc Company). However,
the aucll of the American Oeneral Corporation do
not support the obligations of the Company under
the Contracll.
Mcmbera of Ihe American General Companiel
operate In each of the SO statCl and Canada, and
collectively arc engagcd in lubstantlally all forms of
6nancial lervlccs, with activitiCl heavily weighted
toward Inlurance. American General is a publicly
held corporation, and to manlgement's kaowledge,
81 of March I, 1982, no person owned bene6cially
5% or mare of any cllll of III outstanding slock,
exeept as follows:
Na, of Sharts
Btntficlally
~
2,002,493 shares
NalUrt of
Btntficlal
Ownmhlp
See footnotCl
1 and 2
Ptrrtnl
of Class
8.2%
1,441,807 shares See footnotes
I and 3
5.9%
150,8S0 sharcl See footnotes
I and 4
II.S%
250,000 Ihares Sole voting and
InvCltmenl
powers.
100,0%
Except for pcrcentages of clmel af stock, the Information In Ihlstable relating ta Common Stock and
Convertible Junior Preferred Stock, SeriCl of 1980, hal been laken from Schedule 130 611ngl made In
February 1982 by Fayez Sar06m & Co. and Fayez S. Sara6m Individually and by TexBl Commerce
BancahalCl. Inc. Schedule 13G II a form required by the Securities and Exchange Commission to report
awncnhlp of 5% or more of a clalS of a corporation's securltlCl where the holder's objective Is nOI to
chlnge or Innuence the control of that corporal Ian.
,FOOl..'" r.."..,d.. follow'., ".,.,
6
2 Includes 1,879,105 shares held In accounll manaled by or owned directly by Faycz Sarofim .t Co, or III
subsidiary, Sarofim Trull Co. (both of which Ire relillered Invc.atment advlaers) as 10 which Fayez
Sarofim .t Co. haa shlred power to dispose of and to vole; 14,445 shares held In truIIl of which Mr.
Fayez S. Sarofim, the prc.aldent, a dlreclor, and the majority owner of Fayez Sarofim .t Co., is a IrUllee
but not a beneficiary, and aa to which fayez Sarafim .t Co. also disclaims beneficial ownership; and Ihe
108,943 sharc.a of Common Slock Inlo which the shares af Convertible Junior Preferred Slock, Seric.a of
1980, reported In Ihls table arc canvertlble, Docs not Include 9,314 sharc.a af Common Stock owned by
Mr. Slrofim's wife, as 10 which he dlscllims beneficial ownership,
3 1acludes 1,257,765 sharc.a held by Texaa Commerce Bank N.A, as trultee for American General's
benefit plans. Texaa Commerce Bank Is a wholly owned subsidiary of Texaa Commerce Bancshares,
Inc., a bank haldinl company, which haa shlred power to dispose of all shares reported and sole power
to vote 129,849 such shares and shared power to vote 33,786 such shares.
4 ShIres arc held In accounts managed by or owned directly by fayez Sarofim '" Co. or Sarofim Trust
Co. Fayez Sarofim .t Co. haa shared power to dispose of and to VOle such shares. The Camman Stock
Into which thc.ae shares arc convertible is included In the tOlal number of shares of Common Stock
reported In Ihls lable.
'.vned sub.
(formerly
Hawever,
nation do
tny under
tomplnies
nlda, and
I forms of
i weighted
) publicly
nowledge,
~neficlally
ing stock,
On April 18, 1979, the Board of Directors of the
Company c.atabllshed the Separate Account In
accordance with the Texas Insurance Code. The
Separate Account Is registered with the V,S, Securi.
ties and Exchlnge Commission as a unit investment
trull uader the 1avc.atment Company Act of 1940.
Rellstratlon with the Securities and Exchange Com.
miulan docs not involve lupervislon of manaaement
ar Investment practices or policies of the Separale
Account or the Company by the Cammlsslon.
Vader the Texaa Insurance Code and the Can.
IraCll, the assell of the Separate Account will not be
charlcable with liabilities arislna out of any other
buelness which the Company mlY conduct, but will
be held exclusively for the benefit of the Contract
Owners, Annultanls, and Beneficiaries of the
Contracll,
Each Division of the Separate Account is admlnls.
tered and Iccaunted for as part of the general busl.
ncu of the Company; however, the Income, capital
gains, or capitll losses of each Division of the
Separate Account arc credited 10 or charged a8ainst
the assell held In that Division of the Separate
Account In accordance with the terms of each Con.
tract without regard to the Income, capital aalns, or
Ptrc,m
of Class
8.2%
5,9%
11.5%
100.0%
Stock and
I made In
tommerce
ItO report
I is not to
'0"'111' POI'}
capital losses of any other Division of the Separate
Accoual or arising out of aay other business the
Company may conduct. Each Division of the
Separate Account will invc.at ia Ihe shares of a
specific fund, (for a dc.acriptlon of the Divisions and
the specific fund in which a respective Dlvilion
investa, sce "The Funds", p. 8.)
Each fund Is a dlvcnified, open-end, manaae-
menHype invc.atment company registered under the
Investment Campaay Act of 1940. Such reaistratlon
docs not Involve supervision by the Securities and
Exchange Commission af the investmenta or Invest.
ment policy of a fund. The sharcs of each fund arc
purchased for the appropriate Division of the
Separate Account al net asset value without sales
charaes. Dividends or capital gains dlstributians
received from a Fund arc reinvcsted and retained as
allell of the applicable Division af the Separale
Account, Such distributions Iherefore, increase the
value of the Contract. (See "Accumulation Period",
p. 12 and "Annuity Period", p, 13.) fund shares will
be redeemed at net asset value to the extent necc.a.
sary to make Annuity Paymenll ar other paymenll
under the ContraclI.
7
TRANSFERS AMONG DIVISIONS OF THE SEPARATE ACCOUNT
Transfers of Accumulation and Aanuily Uails
among Divisions of the Separate Account, or
between the General Account and the Separate
Account, arc permitted, subject to the condillons
discussed below, The right to make transfers is
exercisable by the Contract Owner during the
Accumulltion Period and by the Annuitant during
the Annuity Period. The transfer privile8e may be
suspeadcd or terminated at any time.
a. Transfers amon8 Divisions of the Separate
Account or from the Separate Account to the
General Account may be made at intervals of
not less than 30 days durin8 the Accumula-
tion Period and not less than 365 days durin8
the Annuily Period.
b. Transfers from the General Accaunt to a
Division of the Separate Account arc subject
to rCltrictlans. Specifically, durin. the
Accumulatian Period, a transfer to the
General Account will resuil In no further
transferl from the General Account bein.
permiltcd for a period of 90 days. Durln8 the
Annuity Period Iransfers from the General
Account arc not permilled,
c. Transfers will be made anly upon reccipt by
the Company at ill Home Office af wrlllen
InmuctioRs on a form furnished by the
Company,
d. Trlnsfcrs shall be made at the Accumulation
or Annuity Unit vllue next determined Ifler
receipt by the Company of a valid, complete
transfer request.
THE FUNDS
American General Capilal Mana8ement, Inc" a
wholly-owned lubsldlary of American General
Corporation, Is the investment adviser to all four
Funds. A brief summary of the principal character-
IJtlca of each Fund appears below. For complete
Informlllon about each Fund, Includln8 char8C1,
plcuc refer to the prospectus af the particular Fund,
which accompaaics and should be read t08ether wilh
thlJ prospectUJ. Ta receive a prospectus for a par-
ticular Fund, please contact the nearcst Re8ional
Office af the Company. (The addresses for these
offices appear oa the back cover of this prospectus.)
The Fund prospectus should be read carefully before
the purchase of or transfer iato a Division of the
Separate Account which Invests In that Fund,
The Contracts have been funded by Divisions one
and two of the Separlte Account since sales of the
Contracts commenced; by Division three since July
8, 1982; and by Division four since AU8ust 30, 1982,
Ammcan Genenllllgb Yield Accumulation Fund,
lac. (Dhblon 1) was incorporated In Maryland in
1981. In December 1981, the Fund had S I 00,000 In
alSets. The Fund Is available exclusively throu8h
separate accounts of life insurers of the American
General Group, Includln8 the Company.
The Fund's primary objective Isto maximize cur-
rent Income throu8h Investment In a dlvCrlificd
portfolio of hl8h yield fixed. Income securities which
da not subject the Fund to unreasonable rlsu.
Capilal appreciation Is a secondary objective which
will be sou8ht only when consilient with the primary
objective, The hl8h yield securities bou8ht by the
Fund will generally be securities rated in the lower
cate80rics by rec08nlzed ratin8 serviccs (Baa or
lower by Moody's Investon Service, Inc. or BBB or
lower by Standard & Poor's Corporation) or non.
rated securities of comparable quality.
HI8h yieldln8 fixed.income securities such as
those to be included in the Fund's portfolio may be
subject to 8reater mlrket nuctultions and risk of
105.1 of income and principal than arc InvCltmenllln
lower yleldln. fixed. income securilics, Potential
Investorl in Division I should carefully read the
prospectus of American General HI8h Yield
Accumulatlan Fund, Inc. and consider their ability
to allume the rlsu of makin8 an InvCltment In
Division 1.
The mana8ement fee Is at an aanull rate of
0.625% of the Fund's average dally net assets up to
S75 million: 0.55% of the neU S75 million; and
8
ins the
to the
, further
nt beinS
nins the
General
0.50% of tho oxccsa over 5150 millloa: pravlded,
howovor, that If tho ordinary buslncsa expenses of
tho Fund for aay filClll yesr exceed 0.95% of tho first
575 million of tho Fund's averase daily net aum,
phil 0,85% of any excess over 51 5 milllan. tho
manasement feo will be reduced by the amount of
such OXCCIJ.
Amricaa General Money Market FlUId, lac, (Dht.
110II1) WII Incorporated In Mlryland in 1980, In
December 1981, the fund hId ovcr 5200,000 in
IUCU. The Fund is available exclusively throush
separate accounts of life insurers of the American
General Group, includins the Company.
The Fund seeks protectian of capilal and hiSh
curreat income throush Investments in securities
Iuued or suaranteed by the U,S. Government or its
a.eacies or instrumentalities: obllsations of U,S,
banks havins assets in excess of 51 billion; com-
mercial paper rated A-I ar A.2 by Standard &.
Poor's Corporation or P-I or P-2 by Moody's 1nves.
tor's Service, Inc. (or issued by a company havins an
aUlltandln. debt Issue rated atlO8st A by either of
such services); and repurchase asreements of certain
banks which the Investment adviser believes present
minimal rilks, The Fund will not purchase securities
with a remainins maturity of more than one year
and will maintain a dollar-weishted averlse
portfolio maturity of not more than 120 days.
Tho manasement fee is at an annual rate of 0.50%
of the first 5 I 50 million of the Fund's averase daily
net assell; 0.45% of the next 5100 million: 0.40% of
the noxt 5 I 00 million: and 0,35% of the exccsa over
n50 million: provided, however, Ihatif the ordinary
busincsa expeases of the Fuad for any fiscal year
exceed 1% af the Fund's averase dally net assell, Ibo
manasement fee will be reduced by the amount of
such excess.
Amricaa General Equily Accumula,lon Fund,
lac.. (OIriIlon 3) was Incorporated in Maryland In
1982. In June 1982, the Fund had $100,000 in
Issell. The Fund is available oxclullvely throush
separato accounts of life Insurerl of the American
General Group, includlns the Company,
The Fund's primary Investment abjective II
8rowth of capital throush short. term capilal Sllns
:ceipt by
t written
by Ihe
mulation
led after
:omplete
nlu cur-
Iverslfied
CI which
Ie risu,
vo which
primary
t by the
he lower
(Baa or
BBB or
or non-
such as
, mlY be
I risk of
men II In
'otentlal
'cad the
I Yield
r abllily
ment In
rate of
III up to
ion; and
(sains fram sales of securities owned by the Fund for
Icsa than twelve months) on common stock Invest-
menll in companies believed by the Advisor to pos.
lOSS superior srowth potential. Income Is a secon-
dary objective, 10 be sousht only when consiltent
with the primary objective, In order 10 achieve It I
primary Investment policy of realizins sharHerm
capital salns, the Fund senerally will sell portfolio
securities within one year of their date of purchase,
even where other investment consideratioas may
indlcale that such sccuritlca should cantlnue 10 be
held, This may result In the Fund's subsequently
repurchaslns securities it has sold, Notwithstlndlns
this seneral primary Investment policy, the Fund
may hold securities In ill porI folio for more Ihaa
twelve months whenever, in the judsment of the
Advisor, it is adl'antascous for the Fund to do so,
Accordlnsly, the Fund may occasionllly, realize
lans-term sains or losses, as weil as short.term sains
or loascs.
Because of the Fund'l Investment policy of sook.
ins short.term capital salns, the Fund's portfolio
turnover rate will exceed 100% In mOlt ycars and
maybe hiS her than that of mOlt other mutual fundi.
The Fund will lavest principally in common
stocks, under mOlt conditioal, but mlY alJo invest In
bondI, preferred stock and coavertiblo ICCUrities, In
order to maintlin liquidity, part of the Fund'slUCu
may be Invcated in Ihort-lerm commercial paper,
baak certificatca of deposit, repurchlse I.recmenll,
or securities Issued or suaranteed by tho United
States Gavernment, its asencies and laetrumentall.
ties. The Fund docs not invest In forelsn sec:uritics.
The manlsement fee is at an annual rate of 0.50%
of the first 5 I 50 milllan of the Fund'l avcra8e dally
net assell; 0.45% of the next 5100 million: 0.40% of
the next 5100 million: and 0.35% of tho OXCCIJ over
5350 million: provided, hawever, that if tho ordinary
business oxpcnsca of tho Fund for any fiscal year
exceed I.S% of the first 530 million and I % of any
additional averase daily net asselJ, the mlnasement
fee will be reduced by the amount of luch OXCCII,
American General Capital Accumulation F_
lac. (01,111011 4) was incorporated In Maryllnd la
1982, In Ausult 1982, the Fund had 5100,000 tn
9
TYPES OF VARIABLE ANNUITY CONTRACTS
of CoatraclJ are offered by this Beneflciariea) Ire the ume as thOle under deferred
annuity Contracts.
Deferred or Immediate ContraclJ will be iIIued
for AnaultanlJ under lae 75. The Company will
consider the IlIuaace of slnale payment Immediate
Contracll at an aae In nc:ess of 74 under certain
clrcuRlJtances,
The Contracll are aon.partlclpatlaa and will aot
share In any of the profits of the Company.
When Ippllcatlons for ContraclI are received and
Iccepted by the Complny, a Contract will be
prepared Ind forwlrded to the Contract Owner.
(See "Accumulation Period", p, 12,)
Annuity Paymenll under deferred ContraclJ may
bealn on the first day of any month betwocn tho
Annuitant's 50th Ind 75th birthdays, as lelected by
tho Contract Owner, (See "Federal Tax Mallon",
p. 18, for a description of poaaltlea which may
allach to dlllribullonl prior to aao 591'1 or aftor a.o
701'1 under IRAI Ind II.R. 10 Plana.) If no lucb
lelectlon II mado, paymenta will be.ln on tho flnt
day of Ihe month during which tho Annuitant
aaaoll. The Fund II avalllblo nclwlvely tbrouah
IOparate accounIJ of IIfo laluren of tho American
Oonerll Oroup, Includlna Iho Company.
Tho Fund'l primary invettment objective II
lrowth of capital Ihrouah Ion a-term capital aalnl
(plnl from lales of lecuritlea owned by the Fund for
more thaa twelve months) on common lloek Invest-
menll In companies believed by tho Advisor to pas.
181I luperlor arowth potential. Income II a locoa.
clary objective to be louaht only when conlillent
with the primary objective. To achieve Its primary
Investment objective of realizina lonl-term capital
gains, the Fund generally will sell portfolio securities
only after owning them for twelve months or more.
Notwlthltlndlnl this general primary Investment
policy, the Fund may hold portfolio securities for
leu thIn twelve months whenever, In the judlment
of the Advlsor,ltlsldvantaaoow for the Fund to do
so, Accordlnaly, tho Fund may occasionally realize
sbort-term lalal or 1000es, II well as lanl-term aalns
or IOIICI.
Three types
protpectus:
(I) slnalo payment
ContraCIJ;
Immediate
anaulty
(2) slnale payment deferred Inaulty ContraclI;
and
(3) flexible payment
ContraclJ.
deferred
anauity
Under slnllo plyment contracII, only one
Purchase Payment is made by the Contract Owner.
Under a f1exlblo payment Contrlct, Purchaso Pay.
monll aenerally are mado until retirement aae Is
reached.
Uader Immediate annuity ContraclJ, the fillt
Annuity Payment II made on the fint day of the
locoad month after the Purchaso Payment Is
received. Durina the Intervenlna period, tho
Purchaso Paymont II Invested in tho slme manner,
and the other terms and conditions of such
Immedllto Can tract (Includlna the options and
rllhts of Coatract Ownen, AnnuitanIJ and
Under mOlt coaditlona Ihe Fund will lavest
principally In common Sloela, but may also Inveatln
bondi, preferred lloela Ind convertible securities. In
order to maintain liquidity. part of tho Fuad's auell
may be invested In short-term commercill paper,
bank certificates of depoelt, repurchase Ilreemenll,
or securitlea iSlued or auaranteed by the United
States Government, III laencies or iastrumentalltlea.
Tho Fund does not laveat la forelln securitlea.
The manaaemeat fee II at an annual rato of 0,50%
of tho fint S 150 million of the Fund's averaae dally
aet auell; 0,45% of the next 5100 million; 0.40% of
tho next Sloo million: and 0.35% of tho excess oyer
$350 million; provided, however, thulf tho ordinary
buslaeu expenses of the Fund for any fiscal year
exceed 1.5% of tho fint $30 million and I % of any
additlonallverlae dally net 111011, tho mana.ement
fee will be reduced by the amount of luch exCCII.
I
\
10
CHARGES UNDER VARIABLE ANNUITY CONTRACTS
under the Cuntrlcts are dcscribed are not considered to be Purchase Payments for
purposes of calculating a Surrender Charge.
ladividuals considering converling from one of luch
other contrlcts should refer to Appendix C, p. 44,
for complete information about these tranlfers, For
thll purpose, such converted amounts Ihall be
deemed to be withdrawn only after all lublequent
Purchase Payments have been withdrawn,
The Surrender Charge is equal to S% of the Icsler
of all Purchale Paymentl received during the most
recenl 36 monlhs prior 10 the receipt of Ihe lur.
render request by the Company at iu Hame Office
or the amount wilhdrawn.
The firsl partial surrender per Conlracl Year of
10% or less of Accumulation Value will not be
lubjeclto a Surrender Charge. However, If Ihe first
parllal lurrender exceedl 10% of Accumulltlon
Value, Ihe Surrender Charge will be applied to Ihe
amounl In excesl of 10%. The second or lay IUbse.
quent lurrenders durtnl a Conlract Year will be
lubjecl to a Surrender Charge.
If a Surrender Charge il asscssed against any
l'urchBle Payment, Ihal l'urchBle Paymenl (or, If
the Surrender Charge II BlScsled aaainst IcsI than
the entire Purchale Payment, that portion agaiall
which luch chlrae II aSlCSled) will not be subject to
any further Surrender Charge In the event of a
lubsequenl withdrawal.
Examplel of calculation of the Surrender Charle
upon tala I and partial lurrender arc sel farth In
Appendix A, p, 41.42, Examplca 3 and 4.
The Surrender Charge il not imposed upon annui.
tizaUon of a Conlract at the Annuity Dale or upon
any paymentl received by an Annuitanl or Benefici.
ary In lieu of Annuity Paymentl durinl the Annuity
I'erind, except when a lump-Ium payment II elected
by Ihe Annuitant during the Annuity Period under
ill lovclt
invClt In
uritla. In
nd'sallClJ
ial paper,
rccmenlJ,
he United
eatalitlCl.
ritlcs.
o of 0.50%
lralo dally
': 0.40% of
iXCCII over
;e ardlaary
~sc:al year
IJ% of Iny
\nllemenl
rh OXCCII.
ullainl age 70'''' in the calc of IRAs and II.R. 10
Planl and on lhe tirst day of Ihe month the Annui.
tant allainl age 75 in all olher cases.
Since it il contempluted that all Contracts olfered
by this prolpectus will be used for retirement
programs, reference should be made ta lpecific plan
r deferred
All charges
below.
Chargl tar Prlmlum TUla
A deduction is made from each Purchase Pay.
mentlo cover premium taxes, when applicable. (See
"Premium Tax Schedule", Appendix B, p. 43.)
Premium taxCl ranging from zero to 2.5% arc cur.
rently impoled by certain states and municipalities
on Purchase Payments made under annuity Con-
tracts. Under deferred Contractl subject to prcmium
tax, an amount for the tax will be deducted, either
from Purchase Paymentl when received, or from the
amounl applied to elTect an annuity al the time
Annully Pay men IS commence. depending on appli-
cable state law, If an amount for any premium taxcs
is deducted but subsequently determined nol 10 be
due. Ihe Company will apply the amount deducted
la increase Ihe number of Accumulatlan Units or
AnnullY Units under the Contracl althe time such
determlnatian Is made. If no amount for premium
tax was deducled, but tax is subsequently
determined to be due, the Company reserves the
right to reduce Ihe number of Accumulation Units
or Annuily Units under a Contract by the amounl of
the tax due at the time such determination is made.
beluued
.pany will
mmedlalo
er c:ortaia
d will not
ny.
IOlved Ind
I will be
~ Owner.
Chargl tor Plrllal and Tolal Surrandlra
Excepl as provided below, a latal or parllallur-
render is subjecl 10 a Surrender Charge calculaled
as a percentage of the dollar amount of previous
Purchase Payments under the Conlrlcl which arc
withdrawn. It II alwaYI assumed that the most
recent Purchase Paymenls are withdrawn first. and
no Surrender Charge II ever imposed on any amounl
not actually withdrawn.
Amounll Iransferred to this ConlraCI from olher
variable annuity contraels ilSued by the Company
raclS may
:wccn the
lIected by
Mallen",
blch mlY
afler ago
, no such
I the finl
\anultlnl
providuns in connecliun with thil delcripllon of the
Contracts. The Company may amend the ConlraCI
10 conform with subllitutionl of invcslmentl (per
"Reservation of Rights", p. 26) or in order 10 com-
ply with lax laws applicable la these IYpes of
contractI.
II
the fifth Annuity Option, (See "Annuity Payment
Options", p. IS and "Death of Annuitant During
Annuity Period", p. 16.) Nor is the Surrender
Charge imposed on the payment of benefits to a
Beneficiary when an Annuitant dlca during the
Accumulation Period. (See "Death Benefits During
Accumulation Period", p, I J,)
The Surrender Charge reimburses the Company
for pari of Its e~pcnses related to distributing the
Contracll. (See "Dillribution of Variable Annuity
Contracll". p, 26.) The Company believes, however,
thlt the amount of such e~penses will e~ceed the
amount of revenues generated by the Surrender
Charge and will pay such e~cess out of ill general
surplus,
Chlrg. lor Annuli Contrlct Mllnt.nlnc.
An annual Contract maintenance chlrge of SJO
will be assessed each Contract by the Company on
the last day af the calendar quarter ia which the
Campany receives the first Purchase Payment, and
annually on that dlte thereafter during the Accumu-
lation Period, This charge will be assessed equally
among the Divisions of the Separate Account and
tbe Geaeral Account which make up the Accumula-
tion Value of the Contract. The Contract mainte-
nance charge is not guaranteed and may, with prim'
regulatory approval if required, be changed for
future years, Any change to this charge will apply to
Contracll purchased both before and after such
chlnge, This charge is to reimburse the Company
for certain admlnlilrative e~penses, Including the
expensca Incurred In establishing and maintaining
the records relating to a Contract. The Company
dOCl not expect that the revenues It will derive from
this charge will e~ceed such e~penses.
Chlrg. to the Slplrltl Account
To caver other administrative e~penses not
covered by the Contract maintenance charge dis.
cussed above, and to compensate the Compaay for
assuming mortality riskJ under the Contracts, the
Separate Account will incur a dally charge at an
annualized rate of I % on Ihe average dally net assel
value of the Separate Account allributable to the
Contracll. Of this charge, the Company estimates
.07% is for administrative e~pense and ,93% is for
mortality risk. This charge Is guaranteed and may
aot be Increased by the Company,
1a assuming the mortality risk, the Company Is
taking the chance that ill actuarial estimate of
mortality rates during the Annuity Period may
prove erroneous and that the Annuitant will live
longer than expected or that the Annuitant will die
during the Accumulation Period at a time when the
deatb benefit guaranteed by the Compaay Is higher
tban the Accumulation Value of the Contract. The
Company docs not e~pect to earn a profit an that
portion of the charge which is for administrative
expenses, but the Company dacs expect to derive a
profit from the portion which is for auumptlon of
mortality riskJ.
Mllc.nanloul
An annual charge based on a percentage of aver.
age daily net assets Is payable by each F'md to its
Investment adviser for Investment managemeat.
These charges, which arc more fully described uader
"The Funds", p. 8, are borne indirectly by the Con.
tract Owners.
ACCUMULATION PERIOD
During the period before the commencement of
Annuity Payments (the "Accumulation Period"),
the Contract Owner may make Purchase Payments
fram time to time, and on such dates and In such
amounll as may be determined pursuant ta the
retirement plan for which the Can tract has been
purchased. Each Purchase Paymeat, after a deduc.
tlon for premium taxes, where applicable, is credited
ta the Contract In the form of Accumulation Units
In any combination of up 10 three Divisions of the
Separate Accaunt or two divisions of the S~parate
Account and the General Account at the election of
the Contract Owner.
In all cases, a Purchase I'ayment mUlt be
preceded by or accompanied by a properly com-
pleted application. Except in the case of 1RAs,
Purchase Paymenll are generally remilled throulb
or by an em player and the Company mUll also
12
rcc:cive a premium Raw report which identifies the
amount to be credited to each individual Contract
held pursuant to the employer's retirement plan,
If a Purchase Payment and the other required
Information Is received at the Company's Home
Offico before four o'clock p.m, New York time on a
day when Accumulation Unit value is calculated.
the Accumulation Units are credited to the Contract
It their value calculated on that day; otherwise, the
next Accumulation Unit value is used.
When a Purchase Payment accampanies an appli-
cation (and, if required, a premium Row report) to
purchase a Contract, the Campany will, within five
business days after receipt af the application at its
Home Office, either (a) process and accept the
application. issue the Contract, and credit the
Accumulation Units; (b) reject the application and
return the Purchase Payment; or (c) request addi-
tioaal documents or information if the application is
not complete or is Incorrectly campleted. With
respect to (c), a Purchase Payment will be returned
If a correctly completed application is not received
wlthia five days.
The value of an Accumulation Unit in a Division
of the Separate Account increases or decreases in
proportion to the net investment return of the Divi-
lion of the Separate Accaunt, (The net investment
return is based on investment income and realized
and unrealized capital gains and losses. less a deduc-
tiaa for the mortality risk and expcnse charge of 1%
per year.) Therefare, the value of an Accumulation
Unit may vary from date to date depcnding upon the
investment expcrience of the Fund in which the
Divllion af the Separate Account invests,
The value of an Accumulation Unit is calculated
as of faur o'clock p.m. New York time on each
bUliaess day when the New York Stock Exchange is
open, Far thll purpose, Fund shares arc valued at
their net asset value as of such time, Other assets
and liabilities (such as charges against the Separate
Account under the Contracts) arc valued in
pany il
mIte of
iod ma y
will live
will die
hen the
is hllher
act. The
on that
iltrative
derive a
ption of
of aver.
nd to its
lement.
under
the Con-
I of the
Seplrate
cetlon of
accordance with generally-accepted accounting
principles. For information as to the computation of
the net asset value of Fund Ihares, please refer to the
prOlpectul for each Fund.
An lIIultration showing a calculation of a new
Accumulation Unit value and the purchase of
Accumulation Units (using a hypothetical example)
is contained in Examples I and 2 af Appendix A.
p.41.
Dlalh Olnlnl, During Accumulation Plrlod
If an Annuitaat under a Contract dies during the
Accumulation Period, there will be an amount PlY-
able to the Beneficiary equal to the greater of (a) the
Accumulation Value of the Cantract on the date
proof of death evidenced by a certified copy of the
death certificate is received by the Company; or (b)
100% of Purchase Payments reduced by the amount
deducted In connection with any partial surrenders,
(See "Surrender", p, 17.) The Beneficiary has 60
days after the day on which amouatl would be
payable, within which to exercise the right to rcc:cive
the death benefit as a lump-sum settlement or ia the
form of aay of the Annuity Options provided in the
Contract (see "Annuity Payment Option.", p. IS).
in which case the Beneficiary will thereafter be
entitled to exercise all of the Investment optlonl and
other rights under the Coatract,
Suapln,lon 01 Purcha.. Paymlnla
Flexible payment Contracts contain provilionl
pralcetinl against farfelture. If, at any time. addi.
tional Purchale Payments arc not made, the number
af Accumulation Uniu outstanding under the Con.
tract at that time will remain constant (10 long al no
transfer election is made), aad the value of the
Accumulation Units will continue to vary, The Con-
tract Owner may resume making Purchase Pay.
ments at any time during the Accumulation Period,
so long as all Accumulation Units have not been
lurrendered.
ANNUITY PERIOD
mUlt be
rly com-
f IRA.,
through
UII also
Allumld Inwlllmlnl RaIl
The discusllon concerning the amount of Annuity
Payments which follows thil section is based an an
Assumed Investment Rate of 3~%. However. the
Company will permit each Annuitant to select an
Assumed Investment Rate pcrmltted by lIate Ilw or
13
relullllons other than the JVI% rate deacrlbcd In
this prospectus as follows: 4V1%, 5% or 6%. The
forelolnl Allumed Inveatment Ratea arc used
merely In order to determine the ftrll monthly pay.
ment per thousand dollars of value. It should not be
Inferred that such ratea will bear any relatianlhip to
the actual net Investment experience of the Separate
Account.
The use of an Alsumed Investment Rate higher
than JVI% would caule the Orst Annuity Payment to
be )arler, but subsequent payments would Increlle
more slowly or decreale more quickly and ultimately
be less than they would under a J',..,% Assumed
Inveatment Rate, provided that Annuity Payments
continue for a sufficient period of time.
Fixed or Vlrllble Annuity Plymlntl
If the plan so permits, the Annuitant may elect to
have any portion af his individual account applied to
provide either a Variable Annuity or a Fixed
Annuity, or a combination of both. That portion of
the Individual account which Is applied to provide a
Fixed Annuity will be withdrawn from the Separate
Account and thereafter will not participate In Ihe
Investment experience of the Separate Account. The
election of a Fixed or Variable Annuity ISlubjectta
the conditions that (I) such election must be received
II the Home Office of the Company at least thirty
days prior to the Annuity Date, and (II) up to three
Divisions of the Seplrate Account or two Divisions
of the Separate Account and the General Account
may be selected, and (iiI) the Orst paiment provided
under the Variable and the Fixed Annuity must
each be at lellt S2S.
Amount 01 Annuity Plymentl
Tbe Imount of the Orst Variable Annuity pay.
ment to the Annuitant will depend on the amount of
the Accumulltion Value al of the tenth day
Immedlltely pre,'edlng the date Annuity Payments
commence, the amount of any premium tax owed.
the Annuity Option selected, and the sex and
Idjusted ale of the Annultlnt. The Contracts con.
taln tablea Indlcatinl the dollar amount of the Orst
Annuity Payment under each Annuity Option for
each Sl,ooo of Accumulatlan Value (after the
deduction for any premium tax) at various adjusted
ales Ind contain an cxplanatlan of the mlnner In
which adjusted alealre computed. These tablea arc
based upon the Progressive Annuity Table IIsumlng
birthl for the year 1900 and In Allumed Investment
Rate of JVI'I per annum, unlell otherwise lelected.
The amount of the Orst monthly Variable Annuity
payment allocated ta a Division II divided by the
Annuity Unit value (calculated ten days prior to the
date of the ftm monthly payment) for that Division
of the Separlte Account to determine the number of
Annuity Units represented by the payment, The
number of such units will remlln Oxed durlnl the
Annuity Period, assuming Ihe Annuitant mIkes no
transfers out of the Dlvlllon.
In any subsequent month, the dollar amount of
the Variable Annuity payment il determined by
multlplyinl the number of Annuily Units In each
Division by the value of such Annuity Unit an the
tenth day precedlnlthe due date of luch payment.
The Annuity Unit Value willlncrcale or decrelle In
proportion ta the net Investment relurn of the Dlvl.
slon or Dlvlslonl of the Separlte Account used In
connection with a Can tract since the date of the
previous Annuily Payment, less an adjustment to
aeutrallze the JVI'I or other Allumcd Investment
Rate referred to above,
Therefore, the dollar amount of Vlrlable Annuity
payments after Ihe Orst will vary with the amount by
which the nel investment return Is greater or leas
than JVI'I per annum. for example, If a Dlvlllan of
the Separate Account has a cumulative net Invest.
ment return of 5% over a calendar year, the Orst
Aaaulty Payment in the next calendlr year will be
approximately I VI percentage points Ireater thaa
the payment on the same date in the preccdlnl year
and subsequent payments will continue to vary with
the Investment experience of the Dlvlslaa of the
Separate Account. If luch ntt Inveltment return II
I %, the Orlt Annuity Payment in the next calendar
year will be approximately 2YI percentale polnu less
than the payment on the lame date In the preccdlnl
year and subsequent payments will caatinue to vary
with the Invellment experience of the applicable
Dlvlllon af the Separate Account.
14
~anner in
,a bles arc
'Illuming
weslmenl
'Ielecled.
= AanuilY
=d by Ihe
'Ior 10 Ihe
t Divilion
lumber of
lenl, The
uring Ihe
makes no
Each deferred Coatracl provides Ihll, when Fixed
Annuity paymentl arc 10 be made under one of Ihe
first four AnnullY Oplionl described below, Ihe
monlhly plymenl 10 Ihe Annullanl will nOI be less
Ihan Ihe monlhly paymenl available under a Ihen.
currenlly illued single paymenl immediale anaully
Conlracl. The purpose of Ihil provilion il 10 assure
Ihe Annullant Ih~I, al rellremenl, if Ihe FI~ed
AnauilY purchase rales Ihen required by Ihe Cam.
pany for new single paymenl immedlale annuity
ConlracU are slgnificanlly more favorable than Ihe
annully rItes guaranleed by a Contract, Ihe Annui-
tanl will be given Ihe benefil af Ihe new annully
rates,
The value of an Annuity Unit is calculated allhe
lame lime Ihallhe value af an Accumulalion Unll il
calculaled Ind il based on Ihe same valuca for Fund
Ihares and olher assels and lIabilllles, (See
"Acc:umulatlon Period", p. 12,)
An iIIumalion showing, by use of a hypothellcal
example, the method of determining Ihe Annuily
Unll value and the amounl of Variable Annuity
paymenll Is contained In Appendi~ A, E~amples S
and 6, page 42.
Annuity Payment Optlona
The Annuilanl may ciCCI 10 have Ihe Acc:umula.
lion Value of Ihe CanlraCI applied on Ihe Annuity
Dale 10 anyone of Ihe oplions IIsled below. Pay-
meau may be received on eilher a fi~ed or a variable
basis, or a combinallon of fi~ed and variable bales,
In masl cales, if Ihe Annultanl docs not Ipcclfy
one of Ihe opllons al leasl thirty days prior 10 Ihe
Annully Date, Aanuity Paymenu are made In
accordance with the second option, with paymenls
being guaranteed for a ten year period, If, however,
Ihe Annullanl is alleasl age SS and has been mar-
ried for al leasl one year federal pension law mlY
require thll payments be mlde pursuanl 10 Ihe
fourth oplion unless olherwlse elected. Absent a con.
trary election at least Ihirty days In advance,
General Accaunt accumulations will be used to pro-
vide a Fi~ed Annuity, and Separate Accounl
acc:umulallonl will be uled 10 provlda a Varilble
Annuity based on the same Divisions of Ihe Separale
mount of
\nined by
I In each
,il an the
paymenl.
cerease in
Ihe Divi.
II UIcd in
,Ie of Ihe
IIment 10
lVcatment
= Aanuity
.mount by
er or less
IIvislon of
lei invesl.
, Iha Orst
ar will be
aler Ihan
ding year
vary wllh
In of Ihe
return il
: cllendar
jlOlnu less
preceding
Ie to vary
Ippllcable
Accounl In which Ihe Conlracl was invesled
Immediately prlar therelo,
Under most rellremenl programl, no plyment
option II generally permitted unlesl Ihe presenl
value of Ihe payments 10 be made to Ihe Annullaat
il more Ihan SO% of Ihe Ihea value of Ihe tOlal
paymenu to be made to the Annuitanl and the
Aanuitant'l Beneficiary. This II to assure Ihat Ihe
primary purpose of Ihe plan il diuribulion of Ihe
accumulaled fundi 10 the employee,
No electian of any oplion may be made unless an
inilial AnnuilY Paymenl of at least 52S would be
provided whelher a Fi~ed or Variable Annully Is
elected, and 52S on each basis when a combination
of Variable and Fi~ed Annuilies Is elecled. If these
minimums are nOI met, tha Company will mllre a
lump-sum dlslribution to the Annuitanl of the Ihea.
currenl value of the Coatracl. If because of Idverse
Investment performance, a Variable Annuity Pay.
menl of less than 52S monthly wauld be provided,
the Company, at lis elecllon, may make a lump-Ium
paymenl af the Ihen-currenl value of the Conlract 10
the Annuitanl, No Surrender Charge will be
imposed on any lump-sum payment made aa a rl:sull
of Annully Payments failing 10 meet the above.
described 52S minimums,
An Annuitanl or Beneficiary receiving Annuity
Paymenu under the Ofth option, whether on a O~ed
or variable basis, can elect at any time 10 termlnale
luch oplion, and receive Ihe current value of all
remaining Annuity Paymenu owed under the Con.
tracI, discounted to present value (al the Assumed
1nvcalment Rate previously selected) based on
valuca ne~1 determined after the request for such
paymenlis received at the Company's Home Office.
For Informallon as to tha Surrender Charge which
will be imposed on Ihe Purchase Paymenu made
wllhln 36 months preceding such electian by an
Annuilanl, see "Charge for Parlial and Tolal Sur.
renders", p. II, Otherwise, e~ceplln IImlled circum.
stlncea dl,CUlled below under "Dealh af Annullanl
During Annully Period", an Annully Opllon may
not be lerminaled onca Annuily Paymenu have
commenced.
IS
Flnl Opllon - Ufe Annully, Variable Annuity
paymenls arc payable durins the IIfelime or the
Annultanl, and the annuity terminates with the lall
paymenl precedlns death, This option offers the
maximum amount per Variable Annuity payment
since there is no provision ror a death benefit ror
Beneficiaries. II would be polllble under tbIJ option
for lbe Annultanl 10 recellt only 0lIt Annully Pay-
_I If be died prior 10 tbe date of tbe second
paYDltnl, two If be died before tbe tblrd Aaaulty
Payllltlll dale, elc.
Second Opllon - Ufe Annully wltb 60, 110 or
180 Monlbly Pay menU Certain. Variable Annuity
payments arc made monthly durins the Iiretime or
an Annuitant with the proviso that, ir the Aaauitant
dies durins the certain period. the Beneficiary may
receive monthly payments ror the remainder or the
certaia period,
nlrd Opllon - Unll Refund Ufe Annuity. Vari.
able Annuity payments arc payable monthly durins
the IIretime or Ihe Annuitant with an additional
payment ta the Beneficiary at the death or the
Anaultant equal to the thea-current value or any
Annuity Units credited to the Contract at the
Annuity Date which have nottherelorore been paid
aut in the rorm or Annuity Payments. For this pur-
pose, the number or Annuity Units credited to the
Can tract at the Annuity Date will be the total value
applied to this option divided by the Annuity Unit
value 81 the date used to calculate the first Annuity
Payment.
Fourtb Opllon - Joint and Lasl Sunhor Ufe
Auully, Variable Annuity payments are payable
durins the joint IIretlmes or two Annuitants and
continue durins the IIretlme or the survlvlns Annui-
tant. Thll option is deslsned primarily ror couples
who require maximum possible Variable Annuity
payments durins their joint lives and who arc not
concerned with provldlns ror Beneficiaries at the
death or the laat to survive.
Flflb Opllon - Plyments ror DcsllDllted Period.
Variable payments are paid monthly ror a selected
number or years between three and firteen, At any
time durlns luch period, the Annuitant may elect to
receive in one sum the present value or the remlin.
In8 payments, calculated on the baals or an Intercst
rate per annum equal to that rate used to calculate
the Annuitant's first Annuity Payment. If an elcc-
tian to receive such present vllue is made by In
Annuitant, the Surrender Charse will be applied to
Purchase Payments made within 36 months or the
lime or the election, Uader the rederaltax laws, the
election or this lump-sum option may be treated in
the same manner as a surrender or the Contrlct, H
the Contract is surrendered. usually the rull amount
received would be includable In Income rar that
year, and, to the eUent so Included, would be tued
at ordinary rates, subject to possible specill tax
treatment ror lame distributians rrom retirement
prosrams,
D.alh 01 Annullant Prior to Annuity P.rlod
Arter the death or the Annuitant berore Annuity
Payments besia, any amount payable to the Benefi.
clary (see "Death Benefits Durlns Accumulltian
Period", p, 13) may, within 60 daysafter the day oa
which amaunts would be payable, be applied under
any or the five options listed lbove, However. under
an IRA. or a Can tract issued under In H.R. 10
Plan, the options described Ire IImitcd after tl1c
death or the Annuitant as rollows: the entire intercst
payable must be distributed within five years or
must be distributed as an immediate anauity pay.
able ror the lire or the Beneficilry or over a term
certain not e~tendlns beyond the lire e~pectlacy or
tbe Beneficiary, These IImitatloaa do not apply If
the Annuitant wal recelvins paymeau under a
suaranteed certain option berore his death Ind such
payments arc continued to the Beneficiary.
D.ath 01 Annuitant During Annuity Partod
If the Annuitant dies durins the Aanuity Period,
the Beneficiary may be entitled to paymenu or aa
additional amount or amounts, and mlY be entitled
to certain alternatives discussed below, Ir. prior to
death, the Annuitant had been rccelvln8 paymenU
under the first optlan, no additional amounu would
be due, None or the alternatives dlsculled belaw are
available ir the Annuitant had been receivlns pay.
menU under the rourth option.
16
io!.~ -~
e remain-
,n Intercat
calculate
r an elec-
,de by an
applied 10
till of the
; lawI, the
Ireated In
Jntraet. I(
III amount
I for that
1 be tiled
peelal tax
rellrement
1(, however~ the Annuitant had heen recelvlna pay-
menll under the sccond, Ihlrd or the firth opllons,
the Beneficiary may, wilhla 60 days of the Annui-
tant's death, elect one of the followlna Ihree
alternatives:
I. finl, elect to receive in a lump sum the
prcseat value, discounted at the Allumed Invest-
ment Rate, of Bay remainlna Annuity Paymentl
owed under the Contrlct based on Ihe then.cur.
rent Annuity Unit value:
2, sccoad, elecl 10 continue receivina Annuity
Paymenll under the terms of the Contract, in
which case the Beneficiary wauld be entitled aI
any time thereafter 10 receive the present value of
remalnlna Annuity Paymenll, discounted at the
Auumed 1avestment Rate, based on the Annuity
'.rlod
e Annuity
be Beneft-
lImulatlon
the day on
lied under
vcr, under
t H,R. 10
aner the
rc Interest
, yean or
nuity plIy-
'er a term
eclancy of
It apply if
, under a
b and such
ry.
'rlod
ity Period,
.enll of an
be entitled
:r, prior ta
paymenll
~nll would
I below are
livlna plIy,
Unit value nut determined arter request for such
payment is received at the Campany's Home
Ollice: or
J. third, elect to have the present value, dis-
counted atlhe Allumed Investment Rate, of Iny
Annuity Paymenll owed on the Conlracl, based
on Ihe then.current Annuity Unit value, applied
to any of the five above-described Annuity
Options, either on a fixed or variable basis or a
combination thereof,
I( the Beneficiary elects either to continue receiv-
Ina Annuity Paymenll under the Contract, or 10
receive the vllue of such paymenll under one of the
five Annuity Oplions, the Beneficiary is entitled 10
exercise all Ihe inveslment optionl and other rights
under the Contract.
SURRENDER
All or part of the Surrender Value of a Contract
may be withdrawn by the Contract Owaer at any
time befare the commencement of Anauity Pay-
menll, provided that the Annuitant is alive at the
time of surrender. The Caatract must be returned 10
and be received by the Company before a Iota I
lurrender will be elf ected.
The Surrender Value of a Contract aI any time Is
equal to the Accumulltian Vllue under the Con-
tnet II the time of surrender, leu any Surrender
Cbarae. For this purpose, Ihe vllue of an Accumula-
tion Uait isthll neXl computed arter the request for
surrender is received at the Complny's Home Ollice.
There is no assurance thai the Surrender Value will
equal or ucccd the aaareaate amount of Purchase
Paymeall at any time.
A partlll surrender will resuit in a reduction in
lhe number of Accumulltlon Unill credited ta a
Coatract equal 10 the dollar amount lurrendered
phl.l the lurrender charae, if any, divided by the
applicable Accumulation Unit value aext computed
arter the writlen requClt for surrender il received at
the ComplnY'1 Home Ollice.
See "Federll TIl Mallen", p. 18, far a discussion
of poulble Idverae III conlequenccs of any partial
or tOlalsurrender of a Contract. The chlraca which
will be Imposed on total surrenden and may be
imposed on plrtlll surrendm are described above
under "Charge for Partial and Totll Surrenders",
p. 11.
Paymeats of Surrender Values as well as lump-
sum payments aVlllable under an Annuity Oplian
will be made within five businCSl days after receipt
of the wrlllen request by the Compaay at III Home
Office: hawcver, payments allriblltable to a Division
of the Separlte Account may be suspended or
postponed at any lime when redemption of the
Fund's shares is suspended or postpoaed. See the
appropriate caption in the Fund prOlpectuses for a
dlscuulon of the circumltances under which each
Fund may suspend or poslpone redempllon of III
shares. Payments allributable to a Division of the
Separate Accouat may also be suspended or
postponed during any period whea tradlaa oa the
New York Stock Exchlnae II suspended or
restricted, when an emergency makes it Impracti-
cable for the Company fairly to determine the value
of III nel usell, or for such time as Ihe Securities
lad Exchan8e Commission may by order permit.
Occasionally, the Company may receive a request
far total or partill surrender which lacludca
Accumulllion Values derived from Purchue Pay-
menll which hIve not cleared the bankln8 syllem.
17
Tho Company may delay maillna that portion of the
Surrcader Value which relates to .uch amounta until
tho check for the payment hu cleared. The
Acc:umulatloa Unit value u.ed to determine the
remalnlna Surrender Valuo remllled to the Contract
Owner will be on the bul. of the valuation next
computed after receipt of the request for .urrender,
For a dcscriptlon of .peclal IImllation. on .ur-
render which apply to partlclpanlJ la the TUII
State Opllonal Retirement Proaram., .co "TeXl'
State Optional Retirement Proaram", p. 26.
OTHER CONTRACT FEATURES
purcha.ed for an Individual Retlremeat Account.
Once a Contract is in force, the Contrlct Owner and
the Annuitant may not be chlnaed.
FEDERAL TAX MAnERS
deci.lons. Also, the information docs not Include any
discussion of Slate income tax law. applicable to a
Contract,
A..lllnmlnt
1a order to qualify for favorable tax treatment, as
dcscribed under "Federal Tax Mailers", p, 18, each
Contract provides that It may not be sold, asslaned,
tran.ferred, or pledaed as collateral for a loan or as
security for the performance of an obllaation or for
aay other purpose, to any penon or oraanizatlon
other thaa the Company. This provislan docs not,
however, prevent the tranlfer af the Contract from
tho TruJtco of a plan qualified under section 401 (a)
of the Code to an individual, II an alternative In
whole or In part for a cash lump-Ium dlllributian
from the plan.
Contract Ownlrl, Annulllnt. Ind
Ilnlllellrlla
Unlcaa otherwlie .lated In the application, the
Contract Owner II the .ame as the Annullaat under
a Contract, When used In conjunction with qUlllfied
retlremeat plan., the Anaultant will alway. be the
employee for whose benefit the Contract has been
purchased. This il also the cBle whea the Contract is
alnlral
Ill. not feasible to comment on all of the federal
Income tax conlequenccs which may result by
reason of the purchase of a Contract. Each prospec-
tive purchaser I. advised to consult hll personal tax
adviler before purchaslna a Contract for retirement
purpo.cs Dr for any other reason. Moreover, facts
peculiar ta a person may render Inapplicable lome of
the Information let forth below, The law, reaulatlons
and Interpretations thereof upon which the Informa-
tion set forth below Is ba.ed arc subject to chanae by
Conarcaa, the Treasury Department and Judicial
The Beneficiary is dcsianated in the application by
the Contract Owner and mlY be chlaaed at any
time unlcssluch dcsianation has bcoa made irrevo-
cable, If no Beneficiary is Iivina at the time of In
Annuitant's death, aay benefilJ atherwise payable
under the Coatract to the Beneficiary will be pay-
Ible to the Annuitant's estate. If a Beneficiary dics
while rcccivina payments under the Contract, and If
no other Beneficiary i. then IIvina, any remalnlna
benefilJ owed under the Contrlct will be paid to
luch Beaeficiary's estate,
Annully Oltl
The Contract Owner selects the date Aanulty
PlymenlJ will bealn on a form approved by the
Company and may chan8e such date at any time
prior to the be8innin8 of Annuity PaymenlJ by sub-
mlllina an amended form.
18
Revenue Rullns 81-225 ("Rev, Rul. 81-22S") and
Revenue Rulln8 82.54 ("Rev. Rul. 82-54") iuued
by the Internal Revenue Service (the "IRS") on
September 25, 1981 and March 18, 1982, respec-
tively, deal with the federal Income tax treatment of
owaers of variable annuity contraclJ which aro
funded by Ihlres pf a mutual fund ar funds. Rev.
Rul. 81-225 holds that where the mutual fund I.
available for sale directly ta the public (In addition
i
f.tlon by
at any
Irrevo.
e af an
,payable
lbo pay.
ary dies
I, and If
~alnlng
!pald to
to boing sold ta a separale account to fund variable
annuhy contraclS) the owners of lhe annuity con-
lraclS which arc funded by lhe publicly available
mutual fund will nOl bo enthled to tax deferral. The
shares of the Funds olTered under the Contracts arc
not available for sale directly 10 lhe public within
the meaning of Rev, Rul. 81.22S.
Rev. Rul. 82-54 halds thai a contract owner's
right to allocale and lransfer amounlS among several
different mUlual funds and belween the mutual
funds and a fixed accounl pursuanlto the provision
of the Innuily will not jeopardize the tax deferred
lreatment available to an owner of an annuity
contract.
Federal Income lax law regarding annuity con-
traclS has, in recent years, been especially vulnerable
to change, however, lhe Company believes lhat
under presenl law the Conlracts arc annuity con-
tracts for federal income tax purposes.
T.... P.y.ble by Ih. Fund.,
Ihe Comp.ny .nd Ih. Sep.r.l. Accounl
The Funds represented in the Divisions of the
Separale Accounl and In which the Separale
Account will Invest all of Its assets (subject 10 the
provisions under "Reservation of Rights", p. 26)
have qualified and iatend to remain qualified as
regulated Invesiment companies under part I, sub-
chapter M of the Code. Accordingly, If certain
specific Code requirements arc met, the Funds will
not be taxed on amounts they distribule to the
Separate Account, For this reason tax considera-
liaas arc of incidenlallmportance in making invesl-
ments for and In mlnagmenl of the Funds.
The Company Is laxed as a life insurance com-
pany under part I, subchapter L of the Code. The
operallons of lhe Separate Account arc part of the
lotal operations of lhe Company and arc not taxed
seplralely, Under exisllng federal Income tax laws,
the Company Is not lax cd on Investmenl Income
derived by lhe Separale Account (Including realized
aad unrealized capital gains) with respect to the
Contracts olTered by this prospectus, The Company
will allocate 10 lhe Conlracts any federal, state or
olher tax liability which may result In lhe future
fram malnlenance of lhe Separate Account or the
'anulty
by the
ny time
by sub-
ude any
ble to a
S") and
Iluued
.s") on
rcape<:.
meat of
Ich Ire
It. Rev.
fund Is
Iddllion
Conlracts applicable therelo. To the best of lhe
Company's knowledge, there Is no current prospect
of aay such lIabillly.
T.... Pay.ble by Policyholder.
The portion, if any, of any Purchue Payment
made by or on behalf of an Individual under a
Conlract which is not excluded fram the individual's
gross income for tax purposes during the Accumula-
lion Period constitules the Annuitant's "investment
In lhe Cantract", When Annuity Payments begin, or
when a lump sum Is paid in lieu of annuity pay.
ments, the Annullanl will receive back his Invesl-
mentln lhe Contract as a tax free relurn of capital.
This return of capital may be mlde entirely during
the first three years of Annuity Payments or, if the
Annuitanl's investmenl in the Conlract is larger
lhan the amount receivable during lhe first lhree
years, ratably over lhe enlire period of lhe annuity in
accordance with the provisions of lhe Code. The
dollar amount of Annuily Payments, or lump lum In
lieu thercof, received in any year in excess of such
return Is laxable as ordinary income. However,
Annuitaats will generally be in a lower tax bracket
after retiremenl due to lower income and addllional
exemptions.
S.eUon 403(b) AnnulU.I 101 EmploY..1 01 C.rt.ln
T.x ElImpt Orll.nlllUonl or Public EducIUonl1
InlUtuUonl
Purclwe PaymenlS. Under secllon 403(b) af the
Code, payments made by certain employers, (I.e"
tax.exempt organizalions, meeting the requirements
of section SOI(c)(3) of the Code, or public educa-
tlonallnstilulions) la purchase annuilY contrlcts for
their employees arc excludable from the grOll
iacomc of employees to the extentlhatthe a88regatc
purchase payments da not exceed the IImhalions
prescribed by section 403(b)(2) and section 41 S of
the Code. This Is lhe case whether the purchlIC
paymenlS arc a result of voluntary lalary reduction
amounts or employer conlrlbullonl. Purchase pay-
ments In excess of lhe limitations arc currently tax-
able and lhereby provide the employee with an
Investment In lhe contract,
D1stributlOllS Durin. tbe AccUJllulatlOll ParIoL
Dlllrlbutlon paymeats from a section 403(b) Till
19
Dcl'erred Annuity Contract rcaultlng from partial or
total aurrendera durlng an accumulation period arc
wed as ordinary lacome to tbe recipient In
accordanco wltb section 72 of tbe Code.
Tax Free TraDlfen , 'd Rollolen. The Code
providca for tbe tax free excbange of one annuity
contract for Inotber anaulty contract, and the IRS
bas ruled (Revenue Ruling 73.124) thlt amounll
transferred between sC(tlon 403(b) annuily can.
tracll i"ued by different companlca mlY qualify II
tax frcc excbanatS under certain circumstance~, In
additioa, section 403(b)(8) of tbe Code permlll tax
frcc rolloverJ from section 403(b) progranu to IRAs
or otber sC(tlon 403(b) programs under certain
circunulanccs,
s.cllon 401 OUlllfted Pen lion, Pront.8hlrlng
or Annully Pllnl (Including H.R. 10 Pllnl)
hrc... Payllltnll, Purchase Paymeats made by
an employer In Iccardance wltb a pension, profit.
sbarlnl or annuity plan qualified under either sec.
tlon 401 or section 403(a) of the Code (lncludlna
H.R. 10 Plans) arc currently excluded from the
taxable Income of the employee for federal Income
tax purpolCS, Plynienll made by an employee Ire
lenerally not deductible for federal Income tax pur.
poICI. However, If the plan permlll, an employee
may make deductible voluntary contribution equal
to the Iwer of 52,000 or 100% of compensation,
Should a qualified pension, profit.sharlng, or
annuity plan 100e ill qualification, employees could
be required to Include in gross Income tbe purcblse
paymeall made by employers, aad could also lose
otber tax benefill availlble under the Code.
DiltrlbullODl Durlnl tbe Accumulation Period.
Vader prcaentlaw, If (because of a lotal surrender
durlag an accumulation period) an employee (or,
upon the death of an annuitant durlna an accumula.
tlaa period, bls beaeficiary) receivca a lump-sum
distribution from a contract upon the employee's
retirement, other seplratlon from the employer'l
service, deuh, or after auainlng aae 391,'" while still
In service and such distribution (I) Is made within
ono taxable yelr and (II) represents the tatal dls.
trlbutlon payable, that portion of the excess of the
dlltrlbutlon over the emplayee's Purchase Paymenll
wblch II amlbutablo to years of participation prior
ta 1974 may be laxed as lona.term capital lain. Tho
remainder of tho exCClS of the dlmlbution ovor tho
employeo's Purchaso Plymonts will be taxed ilardi.
nary Incomo and may qualify under a specla' 10-
ycar Income averaglal provision of the Code (the
employee also mlY elect this treatment In lieu of the
capital glln treatment referred to in the preceding
sentence).
If I lump-Ium dlltributlon Is mlde to I beneficl.
Iry, he mlY exclude up to 53,000 from the taxable
portlan so long II this lum il Ipportloned betwccn
the ordinary income and the capital allns elemenll
of the dlltributlan. Thil Income tax cxclullon for
beneficllrles Is available even when the payment is
received in Instlllmenll over a perlod lonler tbln
one year under certain circumstlncCl, lenerllly
Including the death of an Innuitlnt prior to
retirement.
If any employee'l contract is surrendered In whole
or In part during an accumulltlon period uader
clrcunutlncca other lhln thOle described In tbe
precedlna paraarlph, lhe excm of the distribution
over the employee's purchlse plyments will be
Includable In the recipient's laxable Income for thlt
ycar and will be taxed as ordinary Income, subject to
possible benefits of lacome averaalnl provlslona
Ivallable to taxpayerl generllly. In addltioa, If a
beneficiary wishes to select an annuity optloa In i1eu
of a lump-sum amount otherwile plYlble under a
contract, he will generally be taxed In Iccordance
with the anauity rules under the Code Ind will not
be taxed on the amount of such vllue at the dlte of
such election,
U.R. 10 Plana. Establishment of an H,R. 10
Plan allowl lelr-employed indlvidulls to maintain
qualified pension, profiHharina, and lanulty plans.
The employees and beneficiaries of such persons Ire
treated as dClcrlbed under lhe immediately preced.
Ing five paraaraphs.
Various special rules apply, however, to solf-
employed Individuals who participate In such truJlJ
or plans, A selr.employed Individual aad bls
beneficlarles are enlitled to long. term capital lain
Ind 10.year Iveraglng treatment of a lump-Ium
dlmlbution In the taxable year II dClCrlbed abovo,
with tho excepllon that lhe dlstrlbutlan must be
20
Fl.
He
Fn
III
.
or
, Is
I
~~
!to
lie
ier
~e
,n
[be
\at
:to
\01
t.
ieu
r a
ice
lot
of
10
lln
ns.
Ire
lxI.
tlf-
1111
his
aln
um
iVe,
be
made after the self.employed Indlvldull haa reached
a.e ~9v" unleas he dies or becomes disabled before
reachln. such a.e.
The maximum annual deduction for contributions
for a self.employed ladlvlduallsthe lesser of I ~% af
earaed Income or 5 I ~,OOO, up to 5200,000 of earned
lacome for Owner/Employees can be taken lata
account In applying the percentage limitation con-
talaed In the plan, NOlwllhsllndlnB these IImlta-
tloas, a self-employed individual mlY deduct an
amount equal to the lesser of his actual contribu.
tloas or 100% of earned income up to 57~0. Aa H,R.
10 Plan may, In addition, permit voluntary
nondeductible purchase payments by Individuals in
proportion to their earnings.
The Code imposes additional restrictions on plans
for self-emplayed individuals who Ire Owner/
Employees (self.employed individuals who are sale
proprietors or who owa 10% or more of a partner-
ship). There Is a penalty In the event of any payment
of whatever type to Owner/Employees prlar to aBe
~9v, other than in the event of death or total dis-
ability, except that an Owner/Employee may be
permllled under an H.R, 10 Plan ta surreader his
voluntary nondeductible purchase payments prior to
allalnlnB Ige ~9v,. Direct ar Indirect borrowing
a.alnst the Contract may be treated as a dlstrlbu.
tloa for this purpose: The Code further requires that
distributions to aa Owner/Employee mUlt begin not
later than during the tauble year In which he
attains age 701'1. Distributions to other Individuals
mUlt commeace at retirement or age 701'1, which-
ever Is later, Finally, Owner/Employees may not
make voluntary purchase payments unle.. such
purchase payments are also made for employees who
arc not Owner/Employees,
In other respects, an Owner/Employee and his
beneficllrles are generally Ireated 81 described
under the Immediately preceding heading.
Individual Rallramanl Annullla.
Purcbase Paymenll. Federal law permits an
Individual with earned income to deduct from gross
Income limited amounts paid in cash for the
purchase of IRA contracts meeting certain require-
menll, The annual purchase paymenll of such con-
tracII cannot exceed the lesser of 52,000 or 100% of
the Individual's earned Income, The deduct Ian is
from groulncame and, consequently, may be tlken
even If the Individual dacs not itemize deductions for
federal Income tu purposes. Moreover, married
indlvldulls may compute the deduction leparately
CYen if they live In a community property stlte:
hawever, both persans must receive compensation If
each Is to qualify.
DItlrtbutlolll Durlnllbe Accumulation Period. Dis-
tribution payments from IRA contracts resulting
from partial or tOlalsurreadcrs or the death of an
Innultant during an accumulation period are tued
as ardinary income to Ihe recipient. In addition, if
distributions occur before the individual for whose
benefit such annuity was established reaches the age
of ~9v, or is disabled, a penalty tu of 10% on the
amount distributed is imposed.
If a contract awner engaBes in certain prahiblted
traasactlons with his IRA contract, such as borrow.
Ing money aBalnst it or pledging It as security, a
constructive distribution of the fair market value af
the contract will be deemed to be made and will be
tued as a lurrender as described In the preccdlag
paragraph.
D1ttrlbutlOlll Durin. lbe AMully Period. Federal
law coatemplates that minimum required distribu-
tions be made under IRA contracII, which in any
event mUll commence not later than the close of the
year In which the individual reaches age 70V" If
such minimum dlstribullons are not made, a penalty
tu of ~O% is imposed on the amount by which the
minimum dlllributian required to be mlde exceeds
the amount actually distributed,
Tax Free ROUOftR. To provide flexibility between
different retirement plans, federal law permilS the
tu free rollover from a qualified employer pension,
profit-shlring, annuity, or bond purchase plan ta an
IRA contract if the following conditions are met: (I)
the rollover of BIIets is completed within 60 days
after the distribution from the qualified plan Is
received: and (2) the balance to the credit of an
Individual In the qualified plan must be plid within
one tuable year as a lump-sum distribution,
21
Seellon 4117 Publlo I!mployer Un'undld Ol'erlld
COllIPln"Uon Pllnl
Pwc..... PI,_", Under section 457 of lho
Code, Individuals who perform services for a Stale
may parlicipale la a deferred compensallon
proaram. Thlslype of proaram allowe Indlvidullslo
defer the receipt of compensallon which would
olherwise be presently payable and 10 therefore
defer Ihe paymenl of federal income laxes on the
amounlS. Far purpoaes of section 457, a "Slale"
mcansl Stale, a political subdivision of a Stale. and
aa aaeacy or Inllrumentallly of a Slale or polillcal
subdivision of a Stale. Employees of rural electric
cooperlllves may also parllcipate In lhese proarams.
The proarlm must be an eliaible Ilate deferred
compensation pia a (an "ESDCP") in order for
purchase paymenu to be presently excludable from
lhe Individual's income for federal tax purpoaes.
Auumina that lhe proaram meets the requiremenls
10 be considered an ESDCP an individual may con.
lribule (and thereby defer fram curreal Income for
tax purposes) Ihe Iwer of $7,500 or 33\-\% of the
Individual's Includable compensation, (IncludIble
compensation means compensalion from the Slate
which II currenlly Includable in aross Incame for
federal lax purpoaes,) In addlllon, durlna the last
three yesrs before an Individual attains narmal
retirement aae addltionll calch.up deferrals arc
permitted.
The amounls which arc deferred may be used by
the Stale to purchase the CantraclS olTered by thie
prospeclus. The Contraclll owned by the Stale Ind
in fact Is subject 10 lhe claims of lhe Slale'e
creditors. The employee has no present rlahu or
veiled Inlereslln lhe Conlract and is only entllled 10
paymenlin accordance with the ESDCP provisionl.
Distributions Durlna the Accumulation Period. No
dislributions durlna an accumulalion period are
aenerally permilled under an ESDCP ucept In
cases of severe financial hardship as defined in lhe
plln's provisionl, Hardship distributions arc Includ.
able in the aross Income of the individual In Ihe year
In which paid.
Dbtrlbullons Durlna lbe Annuli, Period. AmounlS
from an ESDCP arc includable in aross Income for
Ihe taxable year in which such amounU are paid or
olherwise made available.
Tax Free Tra...fers Ind Rollorers, Presenl
federal income lax law docs not allow lax free trlns.
fers or rollovers for amounU accumulated In an
ESDCP.
MANAGEMENT
The direclors and principII otllcers of the Com.
pany arc set forlh below, toaether wllh Iheir currenl
principal business affillallons and their principal
Na. allll Address
Harold S. Hook
Olllce
Senior
Chairman of
the Board
and Director
Michael J. Poulas
Chairman of
the Board
and Director
occupalions durina the past five years. The business
address of each officer and dlreclor Is 2727 Allen
Parkway, Houslon, Teus 77019.
Current Principal Busln", AlIIUatlons and
Principal Occupallons Durlna Pllt Fhe Vears
Chairman of the Baard and Director, American
General Corporation since July 1978 and Presldenl.
July 1975.Aprll 1981: Senior Chairman of the
Board, The Variable Annuity We Insurance Com.
pany since July 1979 and Director since July 1975.
President, American General Corporation since
May 1981 and Director since April 1980; Senior
Vice President, Life Division, American General
Corporation, February 1979.May 1981: Chairman,
Callfornla.Weslern Slales Life Insurance Company
since July 1979; Presidenl and Chief Emutlve Of.
ficer, Callfornia.Weslern Slates Life Inlurance
Company, July 1975.July 1979; Chairman of the
Board, The Variable Annully We Insurance Com-
pIny since July 1979 and Director since April 1979.
22
Cumtll PrIl1d..1 B.I_ "m1l1110lll Ind
1'1... .. A". Q!!g PrlIlCI,.1 Oc:c...lI_ Durllll Pul Fir. Yean
John D. Ho..n Prealdenl President and DlrCl:tor, The Varilble Annuity Life
~ by .nd Director 1nlurance Company Ilnce October 1980: DlrCl:tor.
,Ihll American General life Inaurance Company and
:and American General Life Inlurance Company of Del-
, aware Ilnce November 1980; Vice President. Amerl-
lte'l
, can Productivity Center. September 1919.0ctober
it or 1980; Dean, School of Business Administration.
Wto Cealral Michigan University. Augult 1976-August
ionl. 1979.
1.1'10 Robert L. Baldwin Senior Senior Vice President. AdminlltrBtion and Director,
arc Vice The Variable Anaul~ Life Insurance Company
3t In President, Ilnce July 1979: Vice resident, Insurance Services.
h the Admlnl.tratlon American General Life Insurance Companx, March
~Iud- and Director 1979-July 1979: Second Vice President merlcan
I year General Life Inaurance Co" 1917-1919: SCl:ond
Vice President, American General Insurance Com.
I pany, 1976-1917,
,
cunts Andrew Delancy Senior Vice Senior Vice President. American General Corpora-
,
\e for Prealdent, tlon since 1968; Senior Vice President, Investmenll
~Id or Investmenll Ind Director, The Variable Annuity Life Insurance
and DlrCl:tor Company since April 1977.
resent Stephen D. Bickel Director Vice President and Actuaro' American General
Iraas. Corporltlon slace May 198 . Vice President lad
'In an Actuary, American General life Insuraace Com-
pany and American Generll Life Insurlnce Com-
. ~ny of Delaware, March 1972-May 1980; Director,
he Variable Annuity Life Insurance Complny
since April 1980,
.ainess Joe D. Heu.1 SenloJ Vice Sealor Vice President. Marketing, and Director, The
Presl ent, Variable Annu~ Life Insurance Company since
Allen Marketlnll, October 1980: anager, New Jersey Regional or-
and DlrCl:tor fice, 1971-1980.
.. William B. Pardue Director President. American General Life Insurance Com-
an pany Ind American General Life Insurance Com-
IOrlcan rrny of Delaware since March 1980' Executive Vice
.Ident. resident, American General Life insurance Com.
of the , piny and American General Life Insurance Com-
,Com. ~ny of Dellware, Januarll979-March 1980 and
Irector alnce S'&tember 976; Senior Vice Presl.
I 1975. deat, American eneral Life Inlurance Company
I since aad American General Life Insurance Company of
Senior Delawlre. September 1976-January 1979; Director.
Jeneral The Variable Annuity Life Insurance Compaay
Ilrman. Ilnce May 1980,
lmpan(. William C. Phelps Director Senior Vice President and General Counsel. Amerl.
:Ive 0- can General CorJl<1ratlon since January 1981; Lieu-
aurance tenant Governor. Stlte of Missouri, January 1973.
of the January 1981: Director, The Variable Annu ty Life
e Com. Insurance Company since April 1981.
'111979.
23
Curntll PrillClpll 8.1_ AftlUadou allll
N... ud A..... !!!!!g PrIncipal Oeeupallou Durin. Pul Fha Van Na..
-
Robert O. PurclruU VI~ Chairman Senior Vice President, Life Divilion, American Joe C
af t I Board Oenlral Cor~ration Ilnce May 981' Vica
and Director Chairman of t I Board Ind Director, The Variable
AnnUit~ Life Insurance Com~an~ lince AU~Ult
1981: elf.employed, 1980.19 I: relldent, enn
Mutual Life Inlurance Company, 1979.1980: Presi.
dent, Oecidental Life (Canldian Divilion), 1976-
1979.
Gcorll F. Rcccl Director Vice Chairman, American Oeneral Corporation GrelO
lince Februarr 1979: Senior Vice President, Ameri- 'I
can General nlurance Complny, February:; 1973-
Februar~ 1979: Chairman, Americln Jeaeral
Clpital analement since Mlrch 1978: President, J
American General Capital Manalement, MIY
1976.March 1978; Dircctor, The Variable Annuity
Life lasurance Company Ilnce April 1977.
Terrence J. Conlan Scnle:/; Vice Senior Vice Presiden~ Finance and Trealurer, The
Presl ent. Variable Annuity Li e Inlurlnce Compa':lc' Ilace
Finance. 1981: Dircctor Ilnce April 1982, Vice Presi ent and
Trcuurer and Treasurer, 1980.1981, Vice President and Control- All
Director ler, 1979-1980: Alliltant Vice President and ....lste
Director of Corpora Ie Audit, American Geaeral 1nveatn
Carporatlon, 1976.1979. Owner
Francis R. Cblabrow Vice President. Vice President, Premium Processin. Ind Coml7cnsa- lant dL
Premium tloa Administration, The Varilble Annuity l fe [no after tl
Processina and luraace Complny lince Februlry 19811nd Sccoad
Com\:nsatlon Vice President, 198()"1981 and Allllllnt Vice Presi- inllrue
. Adm nutration dent. 1979.1980: Alllslant Secretary, California- beld Ir
Western StatCl Life Insurance Complny. 1973. otber
1979, allribu
Walter 8. Colvin Vice PrClident, Vice PrClldent, Customer Service Administralioa, Inp 01
CUltomer The Varilble Annui~ Life Inlurance Campany entll1er
Service lince Oetober 1981: ccond Vice Presldeat, Cus. delerm
Administration tomer Service Administration, Februar~ 1981.
October 1981: Mana~er, lana Ran,e Ilnnln.. I Durl
Prudential [nlurance arnpany, 1970. 981. I under I
Diane G. D'AaOltlao Vice President, Vice President, Oeneral Counsel and Secretary, The ~ tbeAnr
Oenenl Caunlel Varllble Annuity Life [nsurlncl Comr~ Ilnce for tbo
and Secretary Februarl 1981 Ind Alliltant Oenera ounlCl. , tbe Cc
1979.19 I: Private law Practice, 1977.1979. Conln'
Leonard M. Rlcbards Vice President Vice President and Portfolio Manlier, Thl Variable I acconle
and Annuity Life Inlurance come'll Ilnce AUtUlt The
Portfolio 1977; ManlAer. Cor/9-ratl Fun I, epublic Nat an. tb, SIp
Manaler al Dank of all... 97~.1977. tnct p:
lifetime
hula of
tbe Cor
Annultl
2~
N.. ... A.....
Joe C. Osborne
~
Vice Praaldent,
Marketlnl
Servlccs
Orelory C. Wilcox
Vice President
and Controiler
]
~
Cumnl PrlllClpal BUlIMIa AtlIllad_ ...
PrlllClpal OccuPltlOlll Dunal Put FlY. Vean
Vice Praaldent, Marketlnl Servlcaa, The Varllble
Annuity Life Inlurance Company, lince October
1981 and Second Vice President Marketlnl Scr-
vlcaa, April 1981-0ctober 1981: Aulltant Vice Prea-
Ident, Director of Marketlna Services, Jaauary
198()'April 1981: Directar of Conlervatloa and
Product Development, January 1978-January 1980:
Director of Complllnce. June 1977.Janulry 1978.
Vice President and Controller. The Variable Annui-
ty Life Inlurance Company lince October, 1981;
Second Vice Preaident and Controller, April 1981-
October 1981: Second Vice Prelident and Auillant
Controller, Auault 1980.April 1981: V, Lance
Tarrance and Alsociates. June 1978-June 1980:
Director of Auditlna, Ranaer 1nlurance Company,
June 1977-June 1978.
25
VOTING RIGHTS
.
I
/u lonl al the Separate Account continues to be
rellatered al a unit Inveatment trult under the
Inveatment Company Act of 1940, the Contract
Owner, dunnlthe Accumulation Period, the Annui-
tant durlnlthe Annully Period, or the Beneficiary,
after tbe Annultant'l death, will be entitled to alve
iDltructloal to the COl)lpaay II to how Fund Ihares
held In the Dlvlllona of the Separate Account (or
other lCCurltlea held In lieu of Fund Ihares)
allrihutable to the Contractlbould be vated It meet.
inp of Ihareholdera of the Fund. TbOle pcraonl
entitled to live vOllnl Inllructlons will be
determined II of the record dlte for the meetina,
Durialthe Accumulation Period. each Anaultant
uader I Contract Involvlnl Purchale Paymenu by
the Annuitant will have the rllhtto alve inltructlons
for thoae votea, natwllhstandlna that the owner af
tbe CoatraCl mlY be the Annuitant's em player.
Coatract Owaerl will Inllruct the Company In
accordance wltb luch Inltructlonl.
The aumber of Fund Iharea held In a Dlvillon of
tbe Separate Account deemed allributable to a Con.
tract prior to the Annuity Date and duriaa the
lifetime of the Annullant will be determined on the
bull of the value of Accumulation Units credited to
tbe Contract II of the record date. On or after the
Annuity Date or after the death of the Annuitant,
I,
e
e
I,
le
II
I'
tbe number of Fund Ihares deemed attributable to
tbe Conlract will be baled on the liability for future
vlriable Annuity Paymenu under the Contractu of
the record dale, Such liability for future paymenu
will be calculated oa the balll of the mortality
auumptlonl and Illumed Inveatmeat return used in
determlnlnlthe number of Annuity Uniu credited
to the Contract and the Ipplicable Annuity Unit
value on the record date. Durinl tbe Annuity
Period, the number af votes allrlbutable to a Con.
tract will aeneraily decreale Ilacc funds set ulde for
an Annullant will decreale.
A Contract Owner, Annullant. or Beneficiary II
aot entitled to sive votlna Inltructiana with respect
to bed Accumulltlon Units or flxed beneflu pay-
able under a Contract.
Contract Owners, AnnullanU, and Beneflciariea
who arc entitled to vote, will receive proxy material
Ind a form on which votlna Inltructlons may be
aivea. Fund sharea held by the Separate Account u
ta which na effective Inltructlonl have heen received
will be voted for or alalnll any propoaltion In the
lame proportlan al the Ihares II to which ialtruc-
tions have been received. Votlallnltructlonl will be
effective only If the Contract II In force on tbe date
of the meetinl.
:.
RESERVATION OF RIGHTS
Tho Company reaerYea lhe rllht In compliance
with appllcablo law (includlnl any required
approval by lho Socurltlea and Exchanle Commll'
lion), (I) to Inveat lho auell of a Dlvllion of the
Separate Account la locurltlea other lhan Fuad
Ihal'Cl as a lubslltute for Fund shlrea already
purchased or as to locurltleato be purchaacd In the
futuro (in lhe event that Iharea of a Fund arc ao
lonler avallablo for purchale or If the Company
lhall determine that continued Inveatment in such
Iharea la not appropriate In view of the purposea of
the Separate Accouat), (2) to operate the Separale
Account as a manalement Inveatm..nt company
under the (nveatment Company Act of 1940, in
coaalderatlon of rocclpl af an Inveatment manlle-
ment fcc, or In any other form pcrmllled by law, lad
(3) to derelister the Separate Account under the
arl
19
(nveatment Company Act of 1940 In the event luch
rellstratloa is no lonler required. (f noccaaary, the
Compaay will amead the Contract, take any other
required action aad notify Contract Ownera within
ftve daYI after aay chanle,
Other than as dllCuucd above, the Compaay will
make no change ia lhe composillon of the aucll of
the Dlvlllons af lhe Separate Accoual ar the provl.
slons of a Contract wilhout the Contract Owner's
conlCnl,
cor
fro
Mt
-
.
In e
Ma
31)
lati,
The Company mlY be merled or coaealldlled
wilh another Inlurer; however, there Is no preaent
pia a 10 do 10. Although there mlY be ao lelll
requirement that Contract Owaera receive nOllce
following aay change in the Ideatity of the iuuer,
the Company wauld volualarlly live luch aotlce.
T
gov,
byt'
11811
Con
cove
prcc
Doc.
subj'
slon,
TEXAS STATE OPTIONAL RETIREMENT PROGRAM
Uader lhe TeXIS State Opllonll Retlremenl
Prolram (the "Texaa Prolram") Purchase Pay.
menll are excludIble from the IrOll Income of
employees 10 the exlent lhat they do not exceed the
IImllatloaa provided by tfie Code.
As Interpreted by the Allorney General of Texas,
the Texas Program, In effect. prohlblll any employee
participating therein from receiving the Surrender
Value of a Contrlct fuading beneftts under the
Texas Prolram prior to tennlnatloa of employment,
retirement or death, Therefore, purauant to an order
obtained from the Securities and Exchange Com.
mwlon, no surrender or partial surrender by a par-
ticipant in the Texas Prolram will be pcrmllled
prior to the occurrence of one of these eveall,
T'
here
belOl
Indel
ellC~
DISTRIBUTION OF VARIABLE ANNUITY CONTRACTS
Separate Accounl is The Variable Annuity Market.
ing Campany ("V AMCO"), a wholly-owned sub-
sidiary of the Company. VAMCO Is a Texas
corporation organized In 1970 and Is a member of
the NASD, VAMCO'I addrcss II 2727 Allen
Parkway, Houston, Texas 77019, Through III sales
force of registered representltivea, V AMCO oper.
ales as a broker.dealer and Is the principal under.
writer for Ihe Company's Separate Account One
and Separate Account Two, These separate accounll
Ire registered apen-end management companlea
TI
ftdell
Bond
office
VAt<
Th
the C
The Company has quallfted or Intends to qualify
the Contracll for sale In all ftfty states and the
District of Columbia and will commence offering the
Caatracts promptly upon quallftcallon In each luch
jurisdiction.
The Contracts are lold by licensed Insurlncc
alenll who arc rellllered repreaentatlves of broker-
dealera which arc members of the National Assocla-
tloa of Securities Dealers, Inc. (the "NASD") or are
otherwile qUI lifted under the Securities Exchlnge
Act af 1934. The principal underwriter for the
26
uch
'the
ther
Ihla
orBanlzed under The (nvCllmenl Compaay Act of
1940.
The licensed asenu who sell the Contracu will be
compenlaled for such salel by commlulons ranslng
from I % to 4.5% of each Purchale Paymenl.
ManaBCrI who lupervlse Ihe aBenu will receive
'will
l. of
; i
re;,;
I
!
~Icd
~nt
le.11
ftlc:c
/Iuer.
Ice,
!
overrtdlnB commlulonl ranBinB 10 I % of Purchase
Paymeats. (ThOle commlulonl arc plid by the
Company and do no/ rClult la any charBe 10 Con.
tract Ownerl or to the Separate Accounlln addition
ta the charsCl dClcribed under "CharsCl Under
Variable Annuity Contracu", p, 11.)
REPORTS TO CONTRACT OWNERS
The Company will send 10 each Contract Owner
la every Contracl Year quarterly statements (as of
March 3 I, Juae 30, September 30, and December
31) which refleclthe aumber and value of Accumu-
lation Units alllibutable 10 a Contract, Contracl
Owners, Annultlnu and Beaeficlalrcs, as appro-
priate, will also receive aanual aad semlanaull
finlncial reporu of the Separale Account and of Ihe
Fund or Funds In which the Conlracl is invClled.
STATE REGULATION
The Company Is subject 10 Ihe laws of Texas
sovernlnB life Insurance companiCl and 10 reBulatlon
by Ihe Texas Commissioner of Insurance, An annual
slalemenl, In a prescribed form, is filed wllh Ihe
Commluioner on or befare March I of each year In addition, Ihe Company is subjecl to Ihe
coverinB the operations of Ihe Company for the insurance lawl and resulationl of Ihe olher jurisdlc.
preceding year and ils financial condition on tions in which It is llcealed 10 do bUlincsa, Gener.
December 31 of such year. lis books and assell arc ally, Ihe insurance departmenll of such jurisdlctionl
lubjectlo review and examination by Ihe Commls- apply Ihe lawl of Texas in determining permluible
sloner al all limcs, and a full examination of ils invcstmenu for the Company.
. EXPERTS
The financial Slatemenls Included elsewhere
herein aad In the reslslratloa stalemenl referred 10
belaw have been examined by Ernsl &: Whinney,
independent auditors, whose reports thereon appear
elsewhere herein and In Ihe reglllration slalemenl
FURTHER INFORMATION
r Ihe
,
menl.
,-.....-
: UlUGr
.Com-
a par-
~llcd
i.
larkel-
d sub-
TelW
tber of
Allen
:a IIlcs
) opcr'
under.
slOne
llCOunlJ
npanlCl
The Company and V AMCO have In force a
fide Illy bond (Life Insurance Companies' Blankel
Bond) In Ihe face amount of $5,000,000, coverins all
ofllcera and employees af Ihe Campany and
VAMCO,
Thll prospeclul conlalnl laformallon concerning
the Company and the Contracls, bul docs nol con.
operations il conducled by Ihe National Association
af Insurance Commissioners al lcall once every
Ihree yeara.
referred 10 below, and have beea so Included in
rellaace upon Ihe reports of Ernsl &: Wbinney siven
upon Ihelr aUlhorily as experts in accounlins and
auditlns.
lain all the information sel forlh In the reslstration
slatement, and all exhlbllS aad schedulcs relatinB
Iherelo, which the Company has filed with Ihe
Securities and Exchange Cammisslan, Walhlnglon,
D. C., under Ihe Securitlcs Acl of 1933 and which II
available 10 the public for Inspctlton and copylnB.
27
I ., .
PINANCIAL STATlMINTS
INDIX
~
The Variable Annuity LIre Insurance Company
Separate Account A -
Report or Independent Audilon. . . . . . . . . . . . . . . . . . . . . . . , . . . . . . . . , , . I , , J . . , . . . , . I . I . . . . , 29
SlItement of Allela and Liabilities .. of December 31, 1981 ............................. 19
Tho Variable Anauity LIre Insurance Company
Consolldaled Bllance Sheela.. of December 31. 1981 and 1980.............,.,..........
Consolldaled Stalemenll of Elminas for each of lhe two yean ended December 31, 1981 ....
COQlolldaled Slalemenla of Chan8C1 in StockholdeR' Equity for each of tho two yeaR ended
December 31. 1981.,.,....."......................... ,.................... I......
33
Consolidated Slalemenla of ChanlCl In Financial POIltlon for each of tho two yeaR ondod
Decem~r 31, 1981......,.............................. ,.... I................ I.... 34
Nota to Consolidated Financial 5t,tomenta . . . . . I . I . I . I . . . . . . I . I . I . . . I . . I I I I . . . I , . . . . . I 35
'.:.:.",.
18
THE VARIABLE ANNUITY LIFE INSURANCE COMPANY
SEPARATE ACCOUNT A
REPORT OF INDEPENDENT AUDITORS
To the Board of Directors and Shareholder
The Variable Annuity Life Insurance Company
HOUlton, Texal 77019
We have examined the statement of assets and liabilities of The Variable Annuity Life
Insurance Company Separate Account A as of December J I, 1981. Our examination was made In
accordance with generally Bccepted auditing standards and, accordingly, included conftrmatlon of
cash held for the account of the Separate Account of S I 00,000 and such other auditing procedures
aI we considered necessary In the circumstances.
In our opinion, the aforementioned statement of assets and liabilities presents fairly the
ftnanclal position of The Variable Annuity Life Insurance Company Separate Account A at
Dccember J 1, 1981, In conformity with generally accepted accounting principles.
ERNST & WHINNEY
Houston, Texas
February 26, 1982
STATEMENT OF ASSETS AND WBIUI'IES
Deetlllbtr 31, 1981
ASSETS:
Cllb la bank.. . . . . . . , , . . , , , ... , . . . , . . . , . " , ,. . . , , . . . , " ...., . .. ,. . . ..... .. .., 5100,000
LIABILITIES - Note . . , . . . . , , . . . . . . . . , . . . . , . . , . . . . , , . . . . . . . , . . . . . . . . . . . . . . . . . None
NET ASSETS - I!qulvaleatto 100,000 ActIlmulltion Units. . , . , .... . . . .. " . ... .. . .. . 5100,000
NOTI! - On April 18, 1979, the Board of Dlrecton of The Variable Annuity Life Insurance Company
Cltablllhed The Variable Annuity Life Inlurance Company Separate Account A In accordance
with the Teus Insurance Code. The Separate Accounthll licen Inactive ncept for matten
relating to its oralOlzatlon .. a unit InvCltment trult under the Investment Company Act of
1940.
29
~
COMMENT ON INSURANCE COMPANY'S FINANCIAL STATEMENTS
n. hilda' .1I1.menll or Tht Variable AllllUlty W. 1...I1II1C. Co.pany .1IOUJd be co.l4trtd only u
baar/ai III'OlI lbe ablUly or lbe Campany 10 IIlttI III oWI.allON ....r lbe Varlabl. Annulty COllll1lcII, "Web
bIcl.. deal. bttItftll, and III tUu.pllOll or I" mortallly alld ex,.... rbb.
REPORT OF ERNST' WHINNI!Y
INDEPENDENT AUDITORS
To the Board of Directors
The Variable Annuity Life Insurance
Company
Hou.ton, Teu. 17019
We have examiaed the consolidated bllance .heall af The Variable Annuity Life 1n.urance Company ae of
December 3 I, 1981 and 1980, and the related conlOlidated slAtement of earninas, Itockholdcn' equity and
chan,es ia financial position for each of the years lhen ended. Our eaaminations were made In accordance with
,eneraliy accepted auditing standards Ind, accordlnaly, included such tesll of the accounting records aad luch
other auditing procedures as we considered necessary In the circumstances.
In our opinion, the consolidated financial Itatementa referred to above present fairly the conaolidated
financial position af The Variable Annuity Life 1nlurance Company as of December 31, 1981 and 1980, and the
coalOlidated resulll of Itl operationl and chan,es in ill financial position for each of the years then eaded, in
conformity with generally accepted accountlna principles applied on a consistent basi..
I
t
HOUltan, Teaae
February 26, 1982
ERNST .\ WH1NNEY
I
I
F
C
t
.1:
o
D
D
I.
.
Ca
PI
at
Nt
3D
THe VARIABLE ANNUITY LIFe INBURANce COMPANY
CONSOLIDATED BALANCe SHeeTS
ASSETS
Investmenll (Notes 3, 5, 7, 8, 9):
Fixed Maturities (market value, 5875,102,148 in 1981 lad
5754,534,135 In 1980)...........".".,...."..,..,..........,
Equity lecuritles (cost, 5104,152,136 In 1981 and 586,439,425 In 1980)
Mortla.e loanl on real cstate (firlt Ileal) . . . , .. . , , . . .. . , . , .. , . , .. . .
Notes reeelvlble from affillltcs (Note 5) . . . , .. .. , , .. , . , , .. .. , , . .. . ,
Short-term lavestments .,....",.."".".,."....".,.."....,.,
Total Investments.,.,....,.. . . . , . , , , , . . , . . . , . . . , . . . . , . . . . .
Cash on deposit and on hand. . . . .. . . . , , . , , . . .. .. . . . . . . . , . .. .. , , , .. .
Investment Income receivable. . , . . . . . , , . . . . , . , . , , , . , , . , . , , . .. . . , . . . ,
Rc<<ivlble for securities sold. , . .. . .. , , . , , .. , .. . . , , .. .. . . , .... . . .. . ,
Furniture and equipment. Icsl accumulated depreciation of 5385,952 In
1981 and 5361,074 In 1980 ........,..............,....,......,..
Deferred policy acquisition COlts, lell accumulated amortlzatlan of
554,091,169 in 1981 and 541,901,000 la 1980 (Note 6)""....,....,
Due from reinsurer (Note 5) .....,..,. .. . . , . ,..' ..' . . .. , . ..... . ..' .
Other assell . . . , . . . . , . . . .. .. .. . . .. , , , .. , , . , .. .. , , .. .. . . .. .. , . . , .. ,
Due from Separate Accaunll , , . . . , , . , , . , , , . . . . , . , , , , , . , , , . . . . . , , . . ,
Net aslets of Separate Accountl ., . . , , , . . , . . , . . , , , , . . , . . , , ,. . , . . . . . .
TOlal Assell .. . . .. .. . , .. . . . . , . . , , . , .. .. , , .. .. . , , .. .. .. .. . ,
L1ABILlTlI!S
Policy reserves for fixed annuity conlracts . , . . .. .. . , . . . .. . . . .. .. .. .. , .
Payable for securities purchased ....""........"....."..,.......,
Remittanccs not alioCated . . . . . .. .. . .. , . , , . . .. .. , , , . . .. , .. . .. .. . . .. ,
Commissions, leneral expenlcs, and tlKes due or accrued ,. . . . . , , . . , . , ,
Due to reinsurer (Note 5) . . . . . . . . , . . , , . , . , , . . . . , . . . , . . . . . . ,. . , . . . , .
Deferred credit on amaunts received from reinsurer ,.....,.,...,..,...
Other liabilities. , . . . . . . . , , . . . . . . . , , , , . , . , , . . , . . . . , , , . , , . , . , , . . . , . .
g~~e:~JjPcd~~~~ tn~~~:t:~i~'iN'~t~'4i""'" ."" ,...... ..',.' ....,
From operations ...,.,.."....",...,..,..,...",..,.,..,."....
From net unrealized Invcstment 8aias, . , , . , .. , .. . , .. . .. . . .. .. . .. . . .
Reserves of Separate Accounts, . .. .. , , , , . , , .. .. , .. . . .. . , , .... ' , .. .. ,
Tolal Liabilities........ . .. , . , . . .. . . . . .. .. , , .... , , . .. , ,
STOCKHOLDERS' I!QU1TY
Capitalllock (votin8) par value 51 per share, 5,000,000 shares
authorized and 3,575,000 shares Issued and oUlllandln8 in 1981 and
1980 ..........,....",...",..".,.""...,.....,',..,.,.....,
Paid-In lurplus. . , . . . , . . . . . . , . . . . , , . . . . , . . , . . . . , , . . , . . , , , . . , . . . , . . ,
~~~a~:r~a~r::Jnr;v~~im~~i 'g~l~i' i~~t' ~r 'd~f~~;~ 'Inc~~~ ii~")': : : : : : : : :
Total Stockholderl' Equity (Note 2) , . . . . . , . . . . . , . , . . , , , . . . . ,
Total Liabilities and Stockholders' Equity. . . . . . . , ' , . , . . . . . , , .
See notes to canlolidated financlll ltatements
31
DocotoNr JI
1M'
51,091,638,536
110,142,646
75,475,019
3.943,684
436,883,369
1,718,083,2S4
1,697,986
31,442,797
20,859,665
2,155.500
73.070,000
1.714,710
3,634,246
258,500
246,232,797
52,099~ 149.455
51,619,056,821
40,356,038
24.137,926
6,224,628
322,907
9,091,000
6,153,545
1,018,531
26,266,000
1,626,000
246,232,797
1.980,486,193
3.575,000
43,964,132
67,221.297
3,902,833
118,663,262
52,099~149,455
....
5 937,471.326
9',342,561
73,191.299
...()-
156,005,841
1.262,011,027
12,807,030
27,301,916
2,775,512
511,951
59.028,000
113,016,719
3,097,683
...()-
237.588.504
51.718,138,342
51.231,778.794
13,260
13,585,710
4,697,085
87,836,808
9,477 ,000
3,536,347
1,276,268
17,139,000
2,220,000
237 .588,504
I ,609, 148,776
3,575.000
43,964,132
S6,02I,9'6
'.428,478
108,989,566
51,718,138,342
T1flI VARIA'La ANNUITY U'IINIUIlANCI COMPANY
CON80UDATlD .TATlMINTS 01' IARNINGS
INCOME:
Variable Annuhy ContraCII:
Deductions from contract owners' contrlbutlonl ., , . . . . . . . . . . , . . . . . , . ,
FOCI for Inveatment advllOry acrvlcea, ..pense undenaklnp and
morllllty luarantOCl, . , . , , . . , , , . . . . . . , . . . . . , . . . . . . . . . . . , . . . . . . . .
FIxed annuity premium. .""".,.......,..,..,...,....,............
Inveatment Income (Note 7) , . . , . . , . . , . . . . . . . , . . . . . . . . . . . . . . . . . . . . , . .
Otber incomo. . ... . ., .., . . . . . .. . . . ., ... , .,. . .,. . , ..... ....... ......
TOTAL INCOME.,.......... .... t... ....... '00 ..... 10 ......
COSTS AND EXPENSES:
Polley COlli:
Net reinlurance cosU . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . , . . . . , . . . . . . . .
Withdrawal. and annuhy benetlll .......... .. .. .. .. .. . .. .. .. . .... ..
Net funds tran.ferred from Separate Accounll.. . . . . . . . , . . . . . . . . . . . . .
InCfCIIC In polley reac:rvea for fixed annuhy contracU . . . . . . . . . . . . . . . . .
TOTAL COSTS....... to, .... " ...... '0...'. to ....,.. .......
EXPENSES:
Amortization of deferred policy acqulaltlon COlli (Note 6). . . .. . . . .. . . .
Commiuiona ..........................................,.........
Salarica. .. . ., .. . .. ... , .. . . ., . . . ..... .... .... ............. .......
Printlnl and ltationery ............................... I . I . . . . . . . . .
I'oIlIle and lelephone . .. . . . .. . , .. .. .. .. , . . .. . . .. .. .. .. .. .. .. . .. . .
Invealment expelllCl (Nole 7) ..,.........,........................
~r P:lrcrna:-cq~iaiil~~' ~ti' ci~i"~;d' (Nole '6i : : : : : : : : : : : : : : : : : : : : : :
TOTAL EXPENSES, . .. , . . .. .. . .. .. . , .. .. , .. .. .. .. .. .. .. .. . ,
TOTAL COSTS AND EXPENSES..,..."..................,'
EARNINGS BEFORE FEDERAL INCOME TAXES and nel rcallr.ed
pins (louea) on Invlllmenll ....."..,.,."."........,..".,...,...
Deferred federal Income laxea (Nole 4) , . . , , ., . , . . , . . . . . . . . .. . . . , . . .. , . ,
EARNINGS before net rcallr.ed .alnl (louea) on InvCltmenll ,....,......,
Nel rcallr.ed lalns (louea) on Inveatmenll (Nole 8) ,................,....
NET EARNINGS, , , . , . , . , , , . , . , . . , , . . . . . , . . . . . . . , . . . . . . . . . .
See nolll 10 co\llOlIdlted t1nancla1.lItemenll
32
v., ~ OJ . 31
t"l .-
S 1,153,345 S 948,731
3,557,330 3,043,752
4-45,417,977 371,600,516 Bal
166.057,327 108,756.060 Nel
5,786,708 123,374 Cb:
621,972.687 484,472,433 0
Ii
Bal.
(2,412,803) (29,989,273) Nel
204,932,539 189,34-4,]39 Cbs
(15,081,950) (17,083,989) or
387,424.145 309,177,551 In
574,861.931 451 ,4-48,630 BaIL
12,190,000 6,500.000
18,354,014 15.489,928
5,009,987 4,093,004
1,257,026 1,140,609
1,307,664 1,155,957
779,946 942,699
9,843,008 7,808,151
(26,232,000) (20,091,000)
22.509,645 17,039,348
597,371,576 468,487,978
24,601,111 15,984,455
(9,127,000) (5,790,000)
15,474,111 10,194,455
(4,274,770) 3,213,882
S 11,199,341 S 13,408,337
THI YAJlIAILI ANNUITY UPlIHlUflANCI COMPANY
COHIOUDATlD ITATlMINTI ()Il CHANGII IN ITOCKHOLDIRI' IQUITY
Balance at December 31, 1979 ",'.
Net eamln.. ,. , . . . , , . . . . . . . . . . . , ,
Cban.ca In unrealized plOl (I01r~:l
on Invcatmenll - net of defe
Inc'lIIle tal ($362,000) . , , , . , . . . . .
Balance at December 31, 1980 .....
Net eamln.. .,..... , , . , . , . . , . . . . .
Cban.e In unrealized .alnl (l0IICI)
on Invcatmenll - net of deferred
Income tal ($593,000) , , . , . . . . . . ,
Balance at December 31, 1981 .....
v.... r-.. Un_ IIf )I, .". MIl ._
Not
u......
I., . I
~~~' ....... llloIMlI CoIoo
lIorJIoo I.onoIolIo (~) r....
$3,575,000 543,964,132 $42,613,619 4,491,843 94,64.4,594
13,408,337 13,408,337
936,635 936,635
3,575,000 43,964,132 56,021,956 5,428,478 108,989,566
11,199,341 11,199,341
(1,525,645) (1,515,645)
$3,575,000 $43,964,132 $67,221,297 $3,902,833 $118,663,262
See nOlea to consolidated ftnanc:lalltatemenll
~
33
. --~... - '.. ~ -
. ,. .
THI VARIAILI ANNUITY UI'IINIURANCI COMPANY
CONIOUDATlD 8TATlMINT8 Oil CHANGII IN I'INANCIAL POSITION
SOURCE OF FUNDS
N~:~~cii 'Ii~mi' i~';lli~ 'I~' income' ~hich 'dld' ~oi 'iweci r~~di' . .
durin, Ihe year:
Increale In fixed Inaulty rClelVCI .........,.,.......,. , . . .. . . . . ,
1acreuc In Inveslment Inoome rcccivlble , . , , . . . . . . . . , . . , . . . . . . . . ,
Amortization of deferred polley tofU .. .. , .. , . .. .. .. . . . . , , . .. . .. .
Accretion of deferred credit from reinlurer . . . . . . . . . . . . , , , . . . , . . . .
Deferred federal Income laxcs ...".....,...",.",'.', , , . . . . . . .
Accrellon of dlscounll on Invcstmenu aad depreciation ,.,.,.......
TOTAL FROM OPERATIONS, , , , . . , . . , . . . . . . , . , . , . , . . . . ,
Procccda from laic, mllurity or repaymeal of InvcstmenU:
Fixed Maturities.,. . , . , . . . . , , . , . . . , , . . . . . , . . . . , , , . . . , . . , . . . . . . . .
Eqully Securitlcs.. . . , .. . , .. .. . . .. .. , . . . .. .. .. . .. .. .. .. . . .. .. .. . .
Incrcuc In payables for securitlCl purchucd..., . . .. . . .. . . . , , . . . ,... . .
Incrcue ldecrealelln premium depoall fund Ind lIema not allocaled ....
Incrcuc decreale In due ta relnlurer. . . . . . . , . . , , . . , , , . . , , . , . . , . , . . .
Dcc:rcaae In calh , , . , . . , . , , , . . . . . , , . . . . . , , , . , , . . . , . . . . . . . . . . . . . . . . .
Otber lIema (net) . , . . . . . . . . . . , . . . . . . , , . . . . , . . . , . . , . . . , . . . . . . . . . . . .
TOTAL SOURCE OF FUNDS, .". . . . . .. . . ... . . . . . . ......
APPLICATION OF FUNDS
Coal of Invcstments:
Filed maturities .................................. I . . . . . . . . . . . , .
Equity J.CCurities r... . . , . . . . . . , , . , . . . . . . . . , . , . . . . , , , , . . . . I . I . . . . .
MortlllC loan. (net) , . , . . . . , , . , , , . . . . , . . .. . , . . .; . . , ; . . . . . . . . . . . .
NOlcs receivable from aftlllalCl '.....,............................
Sbort-term Invcslmenu (net) ......."..........'.....,...........
Deferred polley Icqulllllon COIU ,......"....'.,..................,.
Incrcuc in rccclvlblCl for Iccurltlcslold .. . . .. . . . .. .. . .. . . . . . . . . .. .. .
Dccrcuc in payablcs for lecurlllCl purchucd , . . . , . . . . . . . . . . . . . . . . . . . .
Incrcuc In calb ",.".,.""..,.,.,,'.,,'....'..........,........
Incrcuc (decreale) In due from reinsurer.. . .. .. .. . .. .... . . . . . . .. .. . .
TOTAL APPLICATION OF FUNDS. .. .. . .. .. .. . .. . .. .. ..
See notCl 10 consolidated financlalllatemenll
34
v., EMooIIloctooMf 31
'M' ....
$ 11,199,341
387,278,027
(4,140,881)
12,190,000
(386,000)
9,127,000
(3,390,973)
411,876,514
195,098,126
21,122,027
40,342,778
10,552,216
(87,513,901)
11,109,044
1,42J,SIJ
$604,0 I 0~3 17
3347,460,500
36,505,500
2,208,961
3,943,684
280,877,528
26,232,000
18,084,1SJ
..0-
..0-
(J II ,302.009)
$604,0 I 0,317
S 13,408,337
309,I77,SS3
(6,924,713)
6,500,000
(356,000)
5,790,000
(5,841,536)
321.753,641
96,936,336
17,966,017
..0-
(4,090,149)
5 I ,466,861
..0-
818,033
S484.850,739
$211,711,648
42,463,618
27,302, ISS
..0-
100,590,707
20,091,000
463,042
5,237,151
12,409,443
64.582, I SS
$484,850,739
I . . .
Location or Realonal Offices
270 I B, Camelback Road
Suite J20
Phoenix, AZ 85016
1777 Borel Place
Suite JI4
San Mateo, CA 94402
J6J South Harlan
Suite 207
Lakewood, CO 80226
7402 North 56th Street
BidS. 300, Sulto J80
Tampa, FL JJ617
6J03 Barfield
Sulto 120
Atlanta, OA JOm
2JO N. Mlchl,an
Suite 1010
Ch1caso, 1 L 6060 I
7310 Rltchlo HI,hway
Sulto J04
Olen Bumio, MD 21061
Joo( W. BIS Beaver Road
Suite 722
Troy, MI 48084
5275 Edina Indu.trlal Blvd.
Suite 216
Edina, MN 554J5
Amhent Road Prof. BidS.
440 Amhent Street
Na.hua, NH 03063
25 Commerce Drive
Cranford, NJ 07016
27801 Euclid Avenue
Suite 650
Euclid, OH 44132
1618 S.W. Firat Avenue
Suite 307
Portlaad, OR 9720 I
Dublla Hall
1777 Walton Road
Suite JOJ
Blue Bell, PA 19422
2655 Villa Creek Blvd.
SUllO 250
Dalla., TX 752J4
2040 North Loop Weat
Suite 205
Hou.ton, TX 77018
The Variable AMUlty Ure Insurance Company
2727 Au.. Park".y, "0lII10", Taxu 77019 (713) 526-5251
ne dale of Ih1a proepeclua I. Seplember 17, 1982,
VA 2620
. .
l" C)
t~lr~f k'
If.1f';;~ ~
tA'''" ..,f,fn """1
t~~'{i";'l
~1'..U~""" "Ir:: tv
1',(1 :tJ kI
~.._-t n ,...,
~~,.. ti
~
t
v.
,
,
plaintiff I
,
,
,
I
I
,
I
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
WAYNE R. STOLTZFUS,
VARIABLE ANNUITY LIFE
INSURANCE COMPANY,
Defendant
No. 95-3690 Civil Term
PRILIMIHARY OBJICTIOHS TO COMPLAINT
Defendant, Variable Annuity Life Insurance company
("VALIC"), files these preliminary objections under Pa, R.C.P.
No, 102S(a) (2), (3) based on the following'
I. NOTIOH TO STRIII
1. As appears on the face of the record, the
complaint fails to conform to state and local rules of court.
2. contrary to Pa, R.C.P. No, 1018.1, the complaint
does not contain a notice to defend.
3. The complaint generally avers a claim based on a
contraot and prospeotus. However, contrary to Pa. R.c.P. No.
1019(h), plaintiff has failed to attach a copy of these documents
or to otherwise plead in accordance with the RUles of civil
Procedure.
\
"
4. contrary to Pa. R.c.P. No. 1021(0), the oomplaint
fails to state whether the claimed amount exceede or does not
exceed the jurisdictional amount requiring arbitration referral
under local rule.
5. contrary to Pa, R.C.P. No, 1024(a), the complaint
has not been verified by plaintiff.
WHIRlrORI, pursuant to Pa. R.C.P. No. 1028(a)(2), VALIC
moves the court to strike the complaint based on its lack of
conformity to the above-cited rules.
II. MOTIOH rOR MORI 8PIOIrIC PLIADIHG
1. VALIC incorporates by reference herein paragraphs
1 through 5 of its motion to strike.
2. The complaint is not suffioiently speoific beoause
it fails to aver whether the contract was oral or written I it
fails to attaoh any documents on which the claim is based I and it
fails to set forth the "specified terms and conditions" allegedly
breached by VALIC.
J. VALle's right and ability to defend are unduly
impaired by the unspecific complaint.
WHIRlrORI, pursuant to Pa. R,C,P. No, 1028(a) (3), VALlO
alternatively moves the court to direct plaintiff to file a more
2
speoifio complaint, and to grant suon other relief as it deems
appropriate.
Respeotfully submitted,
KEEFER, WOOD, ALLEN & RAHAL
Dated1 ":/-/7.."1 'f S-
By' A\~~. ~_
~o Dorrance
I. D. 32147
210 Walnut street
P. O. BolC 11963
Harrisburg, PA 17108-196J
(717) 255-8014
ATTORNEYS FOR PLAINTIFF
it .IL
-
3
VIRIrICATICN
I, the undersigned, hereby verifY and state thatl
1. I am counsel for Defendant, Variable Annuity Life
Insurance company, in the foregoing matter.
2. I am authorized to execute this verification based
on the reasons set forth in Pa. R.C.P. No. 1024(c).
J. The facts, if any, contained in tho foregoing
preliminary objections are true and correct to the best of my
knowledge, information, and belief.
4. I understand that false statements herein are made
SUbject to the penalties of 18 Pa. C.B. S4904, relating to
unsworn falsification to authorities.
Datedl 1-/"1...10/ 'f~"'"
6)
,0 ~'i. ~..._ ~ "-
~ Bradford Dorrance
OlRTIrIC1TI or SIRVICI
I hereby certifY that I have this day served a copy of
the foregoing document upon the person(s) and in the manner
indicated belowl
rir,t-class Mail. Postaoe PreDaid
Addressed as FollowSI
Wayne R. stoltzfus
2204 spring Run Drive
Mechanicsburg, PA 17055
(plaintiff)
D.t.., =r /..., i '
~L ~)- ~.
a or Dorrance
1~.....
I"",
f'1
1'--1
,-';f
u)
ti
"'""'1:.,
~
~
Wayna A. StoltzFus
PlalntlfF
vs
Varlable Annuity LIFe
Insurunoe Compuny
DeFendunt
In thu Cumburlund County PA
Court of Common Pleas
No. 95-3590 Civil Term
Answer to Defendant's New Mutter
I. Motion to Strike
1. DeFendant's alleged new mstter appears to be a frlvolou8
filing end should be utrlcken. It conteins no new metter.
but simply additional enswers to PlalntifF'a complelnt and
amended complaint.
However, PIslntif's Answsrs to this Filing Followsl
7. Oenied.
persgraph 3
Dafandant's
Paragraph 7 of Plaintiff's complaint and
of Plaintiff's amended complaint state
improper ections.
B. Denisd.
parsgraph 3
Defandant's
Paragraph 7 of PlaintiFf's complaint and
of Plaintlff'a amanded complelnt state
Improper actions.
B. Denied. Paragraph 9 of Plaintiff's complsint addresses
this psrt. PIsintiff fully complied with any, every, and all
terma of the contrect betwaen tha parties.
10. Oenied. Aefer to psragreph 5 of Pleintiff's complaint
end paragreph 3 of Plelntlff's amended complaint.
Defendant's actions and Defendant's actions slone, violated
the terms of the contrect betwaen PIslntifF end Dafendent
snd oausad Plaintiff's flnanolal loss.
11. Complulnt should not be dlsmisead, but should be
promptly referred for an uvldentsry huuring us PlaintiFF huu
subutantiully oomplied with all thu rulus and oonditionu
neoesuery to obtain his right to s heurinu before e oourt of
law in thia matter.
VIr! F iOBtion
I hlrBby .tete Ind olrtlFy thl Followingl
1. I am thl plaintiFF in thl. matter.
2. The Feots in thia anawar are true and oorrBot.
3. I undurstand that false atatemente are subject to
penaltiea.
/tf ,30, /91r
,.1.a:t,~!!:W-
Oertificete of Serviae
I aertify thet I have on thi. dey .erved . aapy af thi.
doaument upan the plrson(s) end in thl msnnlr indiaeted
below.
First als.. mail, po.tegl pra-paid addrea.ad tOI
VALIC
2929 Allen Plrkway
Haustan, TX 77019
i~J .SOI
~
/~9r
w.!!.~,,~!:1r j--
B'
N
~
N
w
~
.
~
WAYNE R. STOLTZFUS, I
I
plaintiff I
I
v. I
I
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
VARIABLE ANNUITY LIFE
INSURANCE COMPANY,
Defendant
No. 95-3590 civil Term
NOTICE TO PLEAD
TOI Plaintiff, Wayne R. stoltzfus
You are hereby notified to file a written response to
Defendant's enclosed New Matter within 20 days from service
hereof or a jUdgment may be entered against you.
KEEFER, WOOD, ALLEN & RAHAL
Datedl 9,!/~t q~
B.~.~~I ~. .~
~r;d~~orrance
1.0. #32147
210 Walnut street
P. O. Box 11963
Harrisburg, PA 17108-1963
(717) 255-8014
(Attorneys for Defendant)
WAYNE R. STOLTZFUS, I IN THE COURT OF COMMON PLEAS OF
I CUMBERLAND COUNTY, PENNSYLVANIA
Plaintiff I
v. I
I
VARIABLE ANNUITY LIFE I
INSURANCE COMPANY, I
I
Defendant I No. 95-3590 civil Term
ANSWER TO AMENDED COMPLAINT WITH HEW NATTER
Defendant, Variable Annuity Life Insurance Company
("VALIC"), by its undersigned attorney, files this answer and in
support thereof states as follows:
1. Admitted.
2. Admitted in part; denied in part. Admitted that
VALIC issued a prospectus in connection with the parties' written
contract. The contract and the prospectus speak for themselves.
To the extent the remaining allegations in paragraph 2 deviate
from the written terms of these documents, such allegations are
specifically denied and proof thereof is demanded.
3. Denied. VALIC fully complied with the contract
and transferred plaintiff'S funds within five days after
receiving the required forms from plaintiff.
4. Paragraph 4 of the amended complaint is a
conclusion of law to which no responsive pleading is required.
To the extent a responsive pleading is deemed necessary, VALIC
specifically denies that it failed to act in accordance with the
contract and the prospectus, and specifically denies that
plaintiff suffered cognizable damages in the alleged amount.
VALIC demands proof of plaintiff's speculative damages.
5. Denied. Paragraph 5 is a request for relief to
which no responsive pleading is required. To the extent a
responsive pleading is deemed necessary, VALIC specifically
denies the stated allegation and requests that the Court dismiss
the amended complaint with prejudice.
6. Admitted. VALIC admits paragraph 6 of the amended
complaint, to the extent a responsive pleading is deemed
necessary.
WHERBrORB, VALIC respectfully requests that this
Honorable court dismiss the complaint with prejudice, and award
all costs in VALIC's favor as are authorized by law.
HEW NATTBR
7. Plaintiff's complaint fails to state a cause of
action upon which relief can be granted. Alternatively,
plaintiff has failed to aver and cannot establish the requisite
elements of a breach of contract and a claim for reimbursement of
allegedly lost investment opportunities and related costs.
8. VALIC fully or substantially complied with its
contractual obligations, and processed plaintiff's transfer
request within five days after receiving the necessary forms from
plaintiff.
2
9. Plaintiff failed to comply with his obligations
under the contract, including timely sUbmission of the forms
needed by VALIC to process his request.
10. If plaintiff suffered cognizable damages as
alleged, his damages were caused by persons, entities,
occurrencee, or events unrelated to and not under the control of
VALIC.
11. The complaint should be dismissed based on such
other reasons as may appear during discovery or at trial.
WHERErORE, VALIC respectfully requests that this
Honorable court dismiss the complaint with prejudice, and award
all costs in VALIC's favor as are authorized by law. VALIC
requests such other relief as the Court may deem appropriate and
just.
Respectfully submitted,
KEEFER, WOOD, ALLEN & RAHAL
Datedl fj!~/f r-
By1h1'- rvo.d-9-. ~..t - L
~f~ Dorrance
1. D. #32147
210 Walnut street
P. o. Box 11963
Harrisburg, PA 17108-1963
(717) 255-8014
ATTORNEYS FOR DEFENDANT
3
VERIFICATION
I, William A. Wilson , verify and state thatl
Senior Vice Prcsidcnt
1. I am the Gencrol COUllscl lInd Secrctory for The
Variable Annuity Life Insurance Company, Defendant in the
foregoing action.
2. I am authorized to make this verification on behalf
of Defendant.
3. The facts set forth in the foregoing pleading are
true and correct to the best of my knowledge, information and
belief.
4. I understand that false statements herein are made
subject to the penalties of 18 Pa. C.S. 54904, relating to
unsworn falsification to author! ties.
9/14/95 ~ Cl ~
Datedl
OIRTIrIOATI or BBRVIOI
I hereby csrtifY that I have this day served a oOPY of
the forsgoing document upon the person(s) and in the manner
indicated belowl
first-Class Mail. Postaae prenaid
Addressed as FollowSI
Wayns R. stoltzfus
2204 spring Run Drive
Meohanicsburg, PA 17055
(Plaintiff)
Datedl 9 P ~ 1'1 r
eJ:z~L. ~--,
B or Dorranoe
-..I
~
.
......
LI'
-
Ei
"''1;1
J:I,;
...
:$\
. COMMJNWEAl III OF I'ENNSYlVANIA
counl OF COMMON I'LEAS
NOTICE OF APPEAL
IIIOM
JUIlICIAL IlISlnlCI
DISTRICT .IUSTlCE JUDGMENT
COMMON I'l[ AS No
95-3590 Civil 'l'",rlll
NOTICE OF APPEAL
NOltet' 1\ IJIVI'II tholl thl! 1111111.'11.1111 h,l~ 11It't! ill 1111' ,IIH'''''P Cmllt 01 CUI11111011 PIt!il\ .1I1111'1I1'111110lllllw Illdqltll!lllll'luh!lL'd IIV "II! DuHII:t JustlCU
till lilt' t1i111~ ,lIullll tlw ClISl! I1H!IlIIUlWII helm\'.
""Mil 01 .~"IlL"H'-
\laE_~able~nlll1ity Life Ins. Co.
.1111"'" 01' .........1......,
--i'i,,'
_J~~~~~~.5_.' .~.: D~U~-~~a~~_--
".,. ,., CUOI
2929 Allen Pa~kway,
ii.,. ." JUDIUlf"H .Ili.t~.'i-A'. 0"'''.
6/20/95 .nSt(J~~_z~l1s,
Houston,
TX
77253
M()U{
~)U{ CV-0000173-95
.I:'Iaxnl! n'n i;i"-iiU.'D'i':ihY'~S.~::..~,n:~~i:.~~fe Ins. Co.
_____ D_(J~r_anlJ.ll! _.J?.!l9.UJ.!:~_____
(1.11'" "0
TIm hlud. Will hl! sUJlwd ONLY wlwn tlm I1lltiltllJll 1\ IlH I" illH I WHIt!1 Pil.
ncl'..!p N.. 100BO.
Thl\ Notll:t, 01 AlIlwal, wlwll It!rI'IVI!tl hy t1w DIsIIICl Jmllc:t!, will UJlPI.lll! i15
iJ SUPERSEDEAS II) Ilw jUtl111lh!llllol pm~I~\!lHII1IIl tlm (:.I~I'
If 11fJJ1vllilllt
WiJS CliJillliJlIl (nIl! Pa. R.C.P.J.P.
NtJ. 1001(61 i" i/f;ticJ/I Imfore District JmtiCf.J, lit!
MUST FILE A COMPLAINT lVithill tlVellly (201
days alcur I,'/IIY his NOTICE 01 APPEAL.
SH/II,"Uff' ", P,,,tlwfwt,lfr ur {J/',mtv
PRAECIPE TO ENTER RULE TO FILE COMPLAINT AND RULE TO FILE
(Tills Sl'L'/WII of (orm to III' IISf!l1 ONL Y lVllell "/I/I/.'I/.lIIt lVilS DEFfNOAN T (see 1'.1. II. CI'.1. P. No. 100/(71 /II actioll hefole DIS/lld JIIS/ice.
IF NO r USED, lIt,tilch from fOIJV of "ata:a of 1I/J/Jl.'111 to Iw Sf.'fVf:cllI/JlJII 11fJ'wlle,!).
PRAECIPE: Tn P,ulhnllllla,v
WaynB R. Stoltzfus
Enter lull! UpOIl
N,l"1O lit .II'IWllf'I!'"
I appulleuliX, Iu lilt! a COIHIJlaillt ill 1I1IS iJppeal
(c.."''''.." Pleils Nn. _~_5.:J5.20 Civil Ttlrm 1 1'/llllIn twentv 1201 Ilav. alto, ,,"vice 01,"10 "' ,"11er ent,v 01 judo",ont olnllll """.
cEb-u O~r:.... . '~
? S'fJlliJ,me of iJppell,n, or h,. attorney or df/enr
RULE: TIl~X~.e _~'us_t~.l:~E~_El..~__u_____.e"IIO"ee"lf{t~.faO{n~~oS\.rancpc 0 Box 11963
NiJmt.(II iJ/'/Jefft','hl ., . .
Harrisburg, PA l7l0B-1963
(717) 255-BOl4
111 You ill I! Ilotdled lhal a tulo is hlHt!hy t!l1tCflHlupOIl vuu In fllll iJ cUl1lplaillt in this alllll~al wilhin twenty (20) daVI alter the date of
SCIVICI! of this lult! upun you hV persunal service 01 hV CUllilicd ()f leUistered Illdil.
(21 "Villi rill nut 'ile a cornplaint withinlh" tlllH!. a JUDGMENT or: NON PIlOS Will. liE ENTEIlED AGAINST YOU.
131 l~:'~'Il! l~ .o,~~~; IIllh~ ~Ule il ,mvice Wa. hv ilia" " Iho rlotu Ullllili"nu.~. ./ 1
Oale:_____Y__.L-.l0_. - -A--~
/
I
UIV
'f
AOPC 31284
I I i!! I! .I!
;\)1,',1 ','
'.
,
\
.
tit' .
I'nOOF OF SEnVICE OF NOTICr: OF APPF.Al ANIl nULI' 10 FILl' COMPLAINT
." . .. ~ ,t.
,
17111_\ JlillOf of ~'i'll it I' ^'US r nr 1"11 ro H'/JU/;'V } !l'1 if,! U~l L\ III n Ii ',{,rnl (111'1;0111 I' oj ,#1/)1',,1 UN', * .'!IJlIil ,;ii/f' bOll',1
COMMllNWlAl.lIllH ,'LNNSYLVANIA
I'lllJNl Y Of ,
;\1
AFFIDAVIT: I hl'II,I,,: '\\",1' III "H'lnl lkll 'q lv/'d
;\ {OpV of tl1,- l'JlllifP
{J,ltl' lit sl'fvi/t'}
llf Al'fll"i1l, ClJl1ll1H\I! Ph',H
" III
Nil
I j
,
7_. Hl'oh Ihi' f1
h'tIl1.;-I~I1t'JI !;-i'I\'!O' I I
iHIlrt .hnhn_' -IIP\;qlldll,f illt;I('jll ijli
hy hutili,'dlllf'lPIPll'd\ Iliad, sI'ndp,"\
1111' pI ,111.lilll'IIIl"l!'tn. ;lIld Up'll! tll!' dl'lwilFi' (IUI'il') IlIl
I!J 1! Ily p..t\l'J!id ,1'1'>"1 t' ! I hy jn" "I;HII {fHplf'lldlllldd, \l!lllh:,'i H!II'lllt illI'IC!lOt! hutUo
elld hlllh"I lllllt I ~{"\l'd fill! Hull' III 'ill- ,i CillllpLidll
\'.II!HIl Ihl' Huh, ",I! .uldll""l'd nil
fIIJil, 'Itllth','~ II!iYIPI dllt1dlf.',IIWltilll.
,
SWOHN Ji\HIHMlil)1 M~I~ SUIl~GIII\I'I'1l H\:t'(;fjf ME
litiS fMVOF. ,lU
~:i"J'l.lItj/" 1'1 "II" ,;" '1"'/1.. 1\0;'11'" .1/11I1.HIII\'';' "hid.,
',(I'"Olol/wI_li
7~~ IJ
1~.",,_ ~ ~
\"'- 't-'-
My U1IIHIlI\\IIH) !'~ pili '0 1)11
......
-l:'-
\.
'-J
~
l":\
'J
~
~
\')
Co<-,
--
~
,.II! l}llljl,IlI'flllt1 lIw tJlHivt1 NultU ui ^1~!l',11 upun IIH~ ilIlIH;!lno(~\ !"
" If) i'l hy jlH\I)/hil \I'l~l(" j :Ily lrl'll;f'l'itl!Il'tj",I"lI di
S'~:ld'II'" 0' <J""oll
c")'"
Ii"
, .
~
~f
~. ':;
,'"'.f'
UI
j)
\
,
(5
J\l
h!
ti1
~ ;~:"'T
- n
.,
......
V
~I
C>
_ ~ J.
''t ~~
~I
u-.I
t!
"-'
"\
~
I. \'
~\ :--
-~
r
...
t
"
'"
"
r.
i
~-
'"
"
.'.
,
.POMMONWEAL TH OF PENNSYLVANIA
COUNTY OF: CUMBEItLANDo~o"'..7===="~__ ._
NOTICE OF JUDGMENT/TRANSCRIPT
MaQ 1)1t! Nil
Pl.AINTIfF. NAUlar\d A!)I)lll[i.q
!STOLTZFUS, WAYNE It. -I
2204 SPRING ItUN DIt.
MECIIANICSBUItG, PA 17055
L ~
DEFENDANT V5.
ru NAME and A.(JOI1E09 ..,
VARIABLE ANNUITY LIFE INS.CO.
2929 ALLEN PARKWAY
1I0USTON, TX 77253
L ~
Docket No.: CV-0000173-95
Date Flied: 5/19/95
09-3-05
OJ Name Unn
RONALD E. KLAIIl
~~- 507 N. YOItK ST.
MECIIANICSBURG, PA
'......... (7171 766-4575
17055-0000
ATTORNEY DEF PRIVATE
BRADFORD DORRANCE, ESQUIRE
210 WALNUT STREET
HARRISBURG, PA 17101
THIS IS TO NOTIFY YOU THAT:
[!] Judgment was entered for: (Name) STOLTZFUS. WAYNE R.
00 Judgment was entered egalnst: (Name) VARIABLE ANNUITY LIFE INS. CO.
In the amount of $
3.l92.49
(Date) 6/20/95
on:
D Damages will be assessed on:
(Date & Time)
D This case dismissed without prejudice.
D Possession granted.
D Possession granted If money judgment Is not
satisfied within thirty days.
D Possession not grantad.
D Levy Is slayed for _ days or D ganerally stayed.
D Objection to levy has been lIIed and hearing will bs held:
Date: Place:
Amount of Judgment
Judgment Costs
Interest on Judgment
Attornay Fees
$3,l34.99
$57.50
$.00
$.00
$3,192.49
TOTAL
Time:
ANY PARTY HAS THE RIGHT TO APPEAL WITHIN 30 DAYS OF THE DATE OF JUDGMENT BY FILING A NOTICE
OF APPEAL WITH THE PROTHONOTA~Y I CLERK.OF THE COURT OF COMMON PLEAS, CIVIL DIVISION.
. \. i (. Dale - .:' \ , I, _... , District Justice
1 --.
I certify "lat 1I11s Is a true and correct copy of the record of the proceedings containing the judgment,
I . !' .
), , . I ('j Detu. -.. i' \ ( , . . '--- ! District Justice
My commission expires first Monday 01 January, 1996.
SEAL
"ore 316.94
-i:!~
'n '-I:
f.,'l'
~"I
~q
Ant '"
-,."
i~~, -~j~.~ ~,'
. _h-, ,rj ~
~;_C:~il
h' -!-U~~
-..i-"'---!
"-~ ,..
.c '*'':.
~
..
Jr.
\.1\
s
N
a;
fA
WAYNE R. STOLTZFUS, I IN THE COURT OF COMMON PLEAS OF
Plaintiff I CUMBERLAND COUNTY, PENNSYLVANIA
I
V I CIVIL ACTION - LAW
I
I
VARIABLE ANNUITY LIFE INS. CO.1 NO. 95-3590 CIVIL TERM
Defendant I
I
IH RBI VACATE ARBITRATOR
ORDER OF COURT
AND NOW, JANUARY 19, 1996, the appointment of David
Raho, Esquire is hereby vacated and Jacqueline Verney, Esquire,
is appointed in his stead.
By the Court,
/ic<.///iL
Itlrold E. Sheelyl;, P. J.
----
Daniel Deardorff, Esquire
Chairman
_ C,o,.f>"-..,'l"'\;l....L.t 1/:1"\ 1'1 1",
u .A o~
Jacqueline Verney, Esquire
Court Administrator
lsld
W,\\'NI': II. ~iTlll,TZFlls.
I' LII int 11 f
In The Court of Coamon Pl.. I 01
VAIIIAIlI,1': ANNlJlTY LIFE iNSURANCE
HllllI AU. I
}
)
)
)
)
)
\
1995
vu.
Cumberland COUDty, P'nDly1V'Di.
"
ICO.95-359P
Civil
Defendant
OAnI
V. do lo1ema1y lVe.r (or affirm) t.hat ve vill .upport, obey aDd d.f.Dd
&h. Conltitution of th. Unit.d Stat.. and the ConatituCion of Chil Common-
v'11th ID. that v. vill dilch.rae the dutil' of our office with fidelity.
rvJ L- i~~~
niel K. Deardorff, Es re - Chairman ,- (:",
; .< _ J 1/."'....._<-<'
. . erne , E ,fluff'
.C_.. /_~,_J~
Deily 'squire. r.o"
Va, th. underlianed arbitrator., having been duly appointed aud
(or affirmed), ..ks the following Ivard:
(Notel If damea.. for delay are aVlrded, they lhall be
I,plratlly Itlted.)
("
'rt/ .~
IVOrD
w"
~,....~
rk. eJ 't,."\t,.(f
11 ~ 1 'f. ~ f l"t ~ i6( U'1i! r
f/,e
( " ~-t.J .
..
1"\
~~u.t",t
tYF
appl1clbls. )
f.i 1-+
Arbitrator, dilsents. (Insert name if
Dats of Bearing:
3l1.J'I/'
J /1..) 'IL.
Dlts of Award I
7'/1',
Now, the day of ';i.':I/(,( , 19Y';' . It f (t'. L.H., the .bove
award VII enterld upon the docket and notice thereof gIVen by mail to the
plrtiel or their IttorDeys.
Arbitrltors' compenlltion to be
p.id upon appeals
$ .Ii!' ( l 'J
I \ '
I '_". i / " /'.
l"i ,........1 II I( ,/(", ( ,l_" / {" /
Prothonotary
i~.' /. A' j~.7f
Deput'y "'"
By:
,
I, J ' . J
.... ,. 1/ II. l '
,
3'79~ (~~.:.,' 6t.CUI~"- /Jk
~. :96 ':1~ l'1.<.ctfJ 10 rfl
-~ . ) .9(. (~17' ' w:.J;j d. ~t 7f Ott~
~rlMf{'. 111. AP. t..>. l ().
Vu......., - JkUVI ,. /)J{."7
.J. )1 ,J. W\
WAYNE R. STOLTZFUS, I IN THE COURT OF COMMON PLEAS OF
I CUMBERLAND COUNTY, PENNSYLVANIA
Plaintiff I
v. I
I
VARIABLE ANNUITY LIFE I
INSURANCE COMPANY, I
Defendant I No. 95-3590 civil Term
PRAEOIPE TO SATIS'V JUDGMBNT
TO THE PROTHONOTARY I
Please satisfy the above judgment (and the March 7,
1996 arbitration award) upon payment of your costs.
Datel
~ I (p, r9ft.
PLAINTIFF
OERTIrIOATB or SIRVIOB
I hereby certify that I have this day served a copy of
the foregoing document upon the person(s) and in the manner
indicated beloWI
First-class Mail. Postaae PreDai~
Addressed as FollowSI
Wayne R. stoltzfus
32 Teaberry Drive
carlisle, PA 17013
(Plaintiff)
Datedl '1/-2.,/96
~~~~~L^
Or or orrance
,..i
, \
!~..,.;I d
-:-.,
,,14