497 1 y42171b2e497.txt METLIFE OF CT FUND BD II FOR VARIABLE ANNUITIES VINTAGE(SM) ANNUITY PROSPECTUS: METLIFE OF CT FUND BD FOR VARIABLE ANNUITIES METLIFE OF CT FUND BD II FOR VARIABLE ANNUITIES APRIL 28, 2008 This prospectus describes VINTAGE ANNUITY, a flexible premium deferred variable annuity contract (the "Contract") issued by MetLife Insurance Company of Connecticut. The Contract is available in connection with certain retirement plans that qualify for special federal income tax treatment ("Qualified Contracts") as well as those that do not qualify for such treatment ("Non- qualified Contracts"). We may issue it as an individual contract or as a group contract. When we issue a group contract, you will receive a certificate summarizing the Contract's provisions. For convenience, we refer to contracts and certificates as "Contracts". You can choose to have your premium ("Purchase Payments") accumulate on a variable and/or, subject to availability, fixed basis in one or more of our funding options. Your Contract Value before the Maturity Date and the amount of monthly income afterwards will vary daily to reflect the investment experience of the Variable Funding Options you select. You bear the investment risk of investing in the Variable Funding Options. The Variable Funding Options available as of April 28, 2008 are: AMERICAN FUNDS INSURANCE SERIES(R) -- CLASS 2 Legg Mason Partners Variable Money Market American Funds Global Growth Fund Portfolio American Funds Growth Fund MET INVESTORS SERIES TRUST American Funds Growth-Income Fund BlackRock Large Cap Core Portfolio -- Class LEGG MASON PARTNERS VARIABLE EQUITY TRUST E Legg Mason Partners Variable Aggressive Lazard Mid Cap Portfolio -- Class A Growth Portfolio -- Class I Lord Abbett Bond Debenture Legg Mason Partners Variable Capital and Portfolio -- Class A Income Portfolio -- Class I Met/AIM Capital Appreciation Legg Mason Partners Variable Equity Index Portfolio -- Class A Portfolio -- Class II Pioneer Strategic Income Portfolio -- Class Legg Mason Partners Variable International A All Cap METROPOLITAN SERIES FUND, INC. Opportunity Portfolio BlackRock Aggressive Growth Legg Mason Partners Variable Investors Portfolio -- Class D Portfolio -- Class I BlackRock Bond Income Portfolio -- Class E Legg Mason Partners Variable Lifestyle Capital Guardian U.S. Equity Allocation 50% Portfolio -- Class A Legg Mason Partners Variable Lifestyle FI Large Cap Portfolio -- Class A Allocation 70% MFS(R) Total Return Portfolio -- Class F Legg Mason Partners Variable Lifestyle T. Rowe Price Large Cap Growth Allocation 85% Portfolio -- Class B Legg Mason Partners Variable Small Cap T. Rowe Price Small Cap Growth Growth Portfolio -- Class I Portfolio -- Class B LEGG MASON PARTNERS VARIABLE INCOME TRUST Western Asset Management Strategic Bond Legg Mason Partners Variable High Income Opportunities Portfolio -- Class A Portfolio
Certain Variable Funding Options have been subject to a merger, substitution or other change. Please see "Appendix C -- Additional Information Regarding Underlying Funds" for more information. THE CONTRACT IS NO LONGER OFFERED TO NEW PURCHASERS. This prospectus provides the information that you should know before investing in the Contract. Please keep this prospectus for future reference. You can receive additional information about your Contract by requesting a copy of the Statement of Additional Information ("SAI") dated April 28, 2008. We filed the SAI with the Securities and Exchange Commission ("SEC"), and it is incorporated by reference into this prospectus. To request a copy, write to us at P.O. Box 10366, Des Moines, IA 50306-0366, call 800-842-9325 or access the SEC's website (http://www.sec.gov). See Appendix F for the SAI's table of contents. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES OR THE ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. VARIABLE ANNUITY CONTRACTS ARE NOT DEPOSITS OF ANY BANK, AND ARE NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENT AGENCY. TABLE OF CONTENTS
PAGE ---- GLOSSARY................................................................ 3 SUMMARY................................................................. 5 FEE TABLE............................................................... 8 CONDENSED FINANCIAL INFORMATION......................................... 11 THE ANNUITY CONTRACT.................................................... 11 Contract Owner Inquiries................................................ 12 Purchase Payments....................................................... 12 Accumulation Units...................................................... 13 The Variable Funding Options............................................ 13 FIXED ACCOUNT........................................................... 17 CHARGES AND DEDUCTIONS.................................................. 17 General................................................................. 17 Withdrawal Charge....................................................... 18 Free Withdrawal Allowance............................................... 19 Administrative Charges.................................................. 19 Mortality and Expense Risk Charge....................................... 19 Variable Liquidity Benefit Charge....................................... 19 Variable Funding Option Expenses........................................ 20 Premium Tax............................................................. 20 Changes in Taxes Based upon Premium or Value............................ 20 TRANSFERS............................................................... 20 Market Timing/Excessive Trading......................................... 20 Dollar Cost Averaging................................................... 22 ACCESS TO YOUR MONEY.................................................... 23 Systematic Withdrawals.................................................. 23 Loans................................................................... 24 OWNERSHIP PROVISIONS.................................................... 24 Types of Ownership...................................................... 24 Contract Owner.......................................................... 24 Beneficiary............................................................. 24 Annuitant............................................................... 25 DEATH BENEFIT........................................................... 25 Death Proceeds before the Maturity Date................................. 25 Payment of Proceeds..................................................... 27 Beneficiary Contract Continuance (not permitted for non-natural beneficiaries)........................................................ 28 Planned Death Benefit................................................... 29 Death Proceeds after the Maturity Date.................................. 29 THE ANNUITY PERIOD...................................................... 29 Maturity Date........................................................... 29 Allocation of Annuity................................................... 30 Variable Annuity........................................................ 30 Fixed Annuity........................................................... 30 PAYMENTS OPTIONS........................................................ 31 Election of Options..................................................... 31 Annuity Options......................................................... 31 Variable Liquidity Benefit.............................................. 32 MISCELLANEOUS CONTRACT PROVISIONS....................................... 32 Right to Return......................................................... 32 Termination............................................................. 32 Required Reports........................................................ 32 Suspension of Payments.................................................. 32 THE SEPARATE ACCOUNTS................................................... 33 Performance Information................................................. 33 FEDERAL TAX CONSIDERATIONS.............................................. 34 General Taxation of Annuities........................................... 34 Types of Contracts: Qualified and Non-qualified......................... 35 Qualified Annuity Contracts............................................. 35 Taxation of Qualified Annuity Contracts................................. 35 Mandatory Distributions for Qualified Plans............................. 35 Individual Retirement Annuities......................................... 36 Roth IRAs............................................................... 36 TSAs (ERISA and Non-ERISA).............................................. 37 Non-qualified Annuity Contracts......................................... 39 Diversification Requirements for Variable Annuities..................... 40 Ownership of the Investments............................................ 40 Taxation of Death Benefit Proceeds...................................... 40 Other Tax Considerations................................................ 40 Treatment of Charges for Optional Benefits.............................. 40 Puerto Rico Tax Considerations.......................................... 41 Non-Resident Aliens..................................................... 41 Tax Credits and Deductions.............................................. 41 OTHER INFORMATION....................................................... 41 The Insurance Company................................................... 41 Financial Statements.................................................... 42 Distribution of Variable Annuity Contracts.............................. 42 Conformity with State and Federal Laws.................................. 43 Voting Rights........................................................... 43 Restrictions on Financial Transactions.................................. 43 Legal Proceedings....................................................... 43 APPENDIX A: CONDENSED FINANCIAL INFORMATION FOR METLIFE OF CT FUND BD FOR VARIABLE ANNUITIES................................................ A-1 APPENDIX B: CONDENSED FINANCIAL INFORMATION FOR METLIFE OF CT FUND BD II FOR VARIABLE ANNUITIES................................................ B-1 APPENDIX C: ADDITIONAL INFORMATION REGARDING UNDERLYING FUNDS........... C-1 APPENDIX D: THE FIXED ACCOUNT........................................... D-1 APPENDIX E: ENHANCED DEATH BENEFIT FOR CONTRACTS ISSUED BEFORE JUNE 1, 1997.................................................................. E-1 APPENDIX F: CONTENTS OF THE STATEMENT OF ADDITIONAL INFORMATION......... F-1
2 GLOSSARY ACCUMULATION UNIT -- an accounting unit of measure used to calculate the value of this Contract before Annuity Payments begin. ANNUITANT -- the person on whose life the Maturity Date and Annuity Payments depend. ANNUITY PAYMENTS -- a series of periodic payments (a) for life; (b) for life with a minimum number of payments; (c) for the joint lifetime of the Annuitant and another person, and thereafter during the lifetime of the survivor; or (d) for a fixed period. ANNUITY UNIT -- an accounting unit of measure used to calculate the amount of Annuity Payments. CASH SURRENDER VALUE -- the Contract Value less any withdrawal charge and premium tax not previously deducted. CODE -- the Internal Revenue Code of 1986, as amended, and all related laws and regulations that are in effect during the term of this Contract. CONTINGENT ANNUITANT -- the individual who becomes the Annuitant when the Annuitant who is not the owner dies prior to the Maturity Date. CONTRACT DATE -- the date on which the Contract is issued. CONTRACT OWNER (YOU) -- the person named in the Contract (on the specifications page) as the owner of the Contract. CONTRACT VALUE -- Purchase Payments, plus or minus any investment experience on the amounts allocated to the variable funds or interest on amounts allocated to the Fixed Account, adjusted by any applicable charges and withdrawals. CONTRACT YEARS -- twelve month periods beginning with the Contract Date. DEATH REPORT DATE -- the day on which we have received 1) Due Proof of Death and 2) written payment instructions or election of spousal or beneficiary contract continuation. DUE PROOF OF DEATH -- (i) a copy of a certified death certificate; (ii) a copy of a certified decree of a court of competent jurisdiction as to the finding of death; (iii) a written statement by a medical doctor who attended the deceased; or (iv) any other proof satisfactory to us. FIXED ACCOUNT -- an account that consists of all of the assets under this Contract other than those in the Separate Account. HOME OFFICE -- the Home Office of MetLife Insurance Company of Connecticut or any other office that we may designate for the purpose of administering this Contract. For transfer, withdrawal, surrender, and (if applicable) loan requests, our Home Office address is: MetLife, P.O. Box 10366, Des Moines, IA 50306-0366 (for overnight delivery or courier service only: 4700 Westown Parkway, Suite 200, West Des Moines, IA 50266). For Purchase Payments and (if applicable) loan repayments, our Home Office address is: MetLife, P.O. Box 371857, Pittsburgh, PA 15250-7857. MATURITY DATE -- the date on which the Annuity Payments are to begin. PAYMENT OPTION -- an annuity option elected under your Contract. PURCHASE PAYMENT -- any premium paid by you to initiate or supplement this Contract. QUALIFIED CONTRACT -- a contract used in a retirement plan or program that is intended to qualify under Sections 401, 403, 408, 408A or 414(d) of the Code. SEPARATE ACCOUNT -- a segregated account registered with the Securities and Exchange Commission ("SEC"), the assets of which are invested solely in the Underlying Funds. The assets of the Separate Account are held exclusively for the benefit of Contract Owners. SUBACCOUNT -- that portion of the assets of a Separate Account that is allocated to a particular Underlying Fund. 3 UNDERLYING FUND -- a portfolio of an open-end management investment company that is registered with the SEC in which the Subaccounts invest. VALUATION DATE -- a date on which a Subaccount is valued. VALUATION PERIOD -- the period between successive valuations. VARIABLE FUNDING OPTION -- a Subaccount of the Separate Account that invests in an Underlying Fund. WE, US, OUR -- MetLife Insurance Company of Connecticut. WRITTEN REQUEST -- written information sent to us in a form and content satisfactory to us and received at our Home Office. YOU, YOUR -- the Contract Owner. 4 SUMMARY: VINTAGE ANNUITY THIS SUMMARY DETAILS SOME OF THE MORE IMPORTANT POINTS THAT YOU SHOULD KNOW AND CONSIDER BEFORE PURCHASING THE CONTRACT. PLEASE READ THE ENTIRE PROSPECTUS CAREFULLY. WHAT COMPANY WILL ISSUE MY CONTRACT? Your issuing company is MetLife Insurance Company of Connecticut ("the Company," "We" or "Us"). The Company sponsors MetLife of CT Fund BD for Variable Annuities ("Fund BD") and MetLife of CT Fund BD II for Variable Annuities ("Fund BD II"), each a segregated account ("Separate Account"). Prior to December 7, 2007, Fund BD II was sponsored by MetLife Life and Annuity Company of Connecticut ("MLACC"). On that date, MLACC merged with and into the Company, and the Company became the sponsor of Fund BD II. When we refer to the Separate Account, we are referring to Fund BD, except where the Contract was originally issued by MLACC, in which case, we are referring to Fund BD II. THE CONTRACT IS NO LONGER AVAILABLE FOR SALE. It does continue to accept Purchase Payments from existing Contract Owners. For contracts issued in New York, a waiver of the withdrawal charge may apply to all Annuity Payments. CAN YOU GIVE ME A GENERAL DESCRIPTION OF THE CONTRACT? We designed the Contract for retirement savings or other long-term investment purposes. The Contract provides a death benefit as well as guaranteed payout options. You direct your payment(s) to one or more of the Variable Funding Options and/or to the Fixed Account that is part of our general account (the "Fixed Account"). We guarantee money directed to the Fixed Account as to principal and interest. The Variable Funding Options fluctuate with the investment performance of the Underlying Funds and are not guaranteed. You can also lose money in the Variable Funding Options. The Contract, like all deferred variable annuity contracts, has two phases: the accumulation phase and the payout phase (annuity period). During the accumulation phase generally, under a Qualified Contract, your pre-tax contributions accumulate on a tax-deferred basis and are taxed as income when you make a withdrawal, presumably when you are in a lower tax bracket. During the accumulation phase, under a Non-qualified Contract, earnings on your after- tax contributions accumulate on a tax-deferred basis and are taxed as income when you make a withdrawal. The payout phase occurs when you begin receiving payments from your Contract. The amount of money you accumulate in your Contract determines the amount of income (Annuity Payments) you receive during the payout phase. During the payout phase, you may choose one of a number of annuity options. You may receive income payments in the form of a variable annuity, a fixed annuity, or a combination of both. If you elect variable income payments, the dollar amount of your payments may increase or decrease. Once you choose one of the annuity options and begin to receive payments, it cannot be changed. WHO CAN PURCHASE THIS CONTRACT? The Contract is available for use in connection with (1) individual non-qualified purchases; (2) rollovers from Individual Retirement Annuities (IRAs); (3) rollovers from other qualified retirement plans and (4) beneficiary-directed transfers of death proceeds from another contract. Qualified Contracts include contracts qualifying under Section 401(a), 403(b), 408(b) or 408A of the Code. Purchase of this Contract through a tax qualified retirement plan ("Plan") does not provide any additional tax deferral benefits beyond those provided by the Plan. Accordingly, if you are purchasing this Contract through a Plan, you should consider purchasing this Contract for its death benefit, annuity option benefits, and other non-tax-related benefits. The Contract is no longer available for sale. You may make additional payments of at least $500 at any time during the accumulation phase. No additional payments are allowed if this Contract is purchased with a beneficiary-directed transfer of death proceeds. If your Contract was issued as a Qualified Contract under Section 403(b) of the Code in a 90-24 transfer completed on or before September 24, 2007, we urge you to consult with your tax advisor prior to making additional purchase payments (if permitted) as significant adverse tax consequences may result from such additional payments. (See "Federal Tax Considerations.") CAN I EXCHANGE MY CURRENT ANNUITY CONTRACT FOR THIS CONTRACT? The Code generally permits you to exchange one annuity contract for another in a "tax-free exchange." Therefore, you can transfer the proceeds from another annuity contract to purchase this Contract. Before making an exchange to acquire this Contract, you should carefully compare this Contract to your current contract. You may have to pay a surrender charge under your current contract 5 to exchange it for this Contract, and this Contract has its own surrender charges that would apply to you. The other fees and charges under this Contract may be higher or lower and the benefits may be different than those of your current contract. In addition, you may have to pay federal income or penalty taxes on the exchange if it does not qualify for tax-free treatment. You should not exchange another contract for this Contract unless you determine, after evaluating all the facts, the exchange is in your best interests. Remember that the person selling you the Contract generally will earn a commission on the sale. IS THERE A RIGHT TO RETURN PERIOD? If you cancel the Contract within twenty days after you receive it, you will receive a full refund of your Contract Value plus any Contract charges and premium taxes you paid (but not fees and charges assessed by the Underlying Funds). Where state law requires a different right to return period, or the return of Purchase Payments, the Company will comply. You bear the investment risk on the Purchase Payment allocated to a Variable Funding Option during the right to return period; therefore, the Contract Value we return may be greater or less than your Purchase Payment. If you purchased your Contract as an Individual Retirement Annuity, and you return it within the first seven days after delivery, or longer if your state law permits, we will refund your full Purchase Payment. During the remainder of the right to return period, we will refund your Contract Value (including charges we assessed). We will determine your Contract Value at the close of business (generally, 4:00 p.m., Eastern Time) on the day we receive a Written Request for a refund. CAN YOU GIVE A GENERAL DESCRIPTION OF THE VARIABLE FUNDING OPTIONS AND HOW THEY OPERATE? The Variable Funding Options represent Subaccounts of the Separate Account. At your direction, the Separate Account, through its Subaccounts, uses your Purchase Payments to purchase shares of one or more of the Underlying Funds that holds securities consistent with its own investment policy. Depending on market conditions, you may make or lose money in any of these Variable Funding Options. You can transfer among the Variable Funding Options as frequently as you wish without any current tax implications. Currently there is no charge for transfers, nor a limit to the number of transfers allowed. We may, in the future, charge a fee for any transfer request, or limit the number of transfers allowed. At a minimum, we would always allow one transfer every six months. We reserve the right to restrict transfers that we determine will disadvantage other Contract Owners. You may transfer between the Fixed Account and the Variable Funding Options twice a year (during the 30 days after the six-month Contract Date anniversary), provided the amount is not greater than 15% of the Fixed Account value on that date. Where permitted by state law, we also reserve the right to restrict transfers into the Fixed Account if the credited interest rate is equal to the minimum guaranteed interest rate specified under the Contract. Amounts previously transferred from the Fixed Account to the Variable Funding Options may not be transferred back to the Fixed Account for a period of at least six months from the date of the transfer. WHAT EXPENSES WILL BE ASSESSED UNDER THE CONTRACT? The Contract has insurance features and investment features, and there are costs related to each. We deduct an administrative expense charge and a mortality and expense risk ("M&E") charge each business day from amounts you allocate to the Separate Account. We deduct the administrative expense charge at an annual rate of 0.15% and deduct the M&E charge at an annual rate of 1.02% for the Standard Death Benefit and 1.30% for the Enhanced Death Benefit. For Contracts with a value of less than $40,000, we also deduct an annual contract administrative charge of $30. Each Underlying Fund also charges for management costs and other expenses. We will apply a withdrawal charge to withdrawals from the Contract, and will calculate it as a percentage of the Purchase Payments withdrawn. The maximum percentage is 6%, decreasing to 0% after six full years. (This includes withdrawals resulting from a request to divide the Contract Value due to divorce.) Upon annuitization, if the Variable Liquidity Benefit is selected, there is a maximum charge of 6% of the amounts withdrawn. Please refer to Payment Options for a description of this benefit. HOW WILL MY PURCHASE PAYMENTS AND WITHDRAWALS BE TAXED? Generally, the payments you make to a Qualified Contract during the accumulation phase are made with before-tax dollars. Generally, you will be taxed on your Purchase Payments and on any earnings when you make a withdrawal or begin receiving Annuity Payments. Under a Non-qualified Contract, payments to the Contract are made with after-tax dollars, and earnings will generally accumulate tax-deferred. You will be taxed on these earnings when they are withdrawn from the Contract. If you are younger than 59 1/2 when you take money out, you may be charged a 10% federal penalty tax on the amount withdrawn. 6 For owners of Qualified Contracts, if you reach a certain age, you may be required by federal tax laws to begin receiving payments from your annuity or risk paying a penalty tax. In those cases, we can calculate and pay you the minimum required distribution amounts (see "Access to Your Money -- Systematic Withdrawals"). HOW MAY I ACCESS MY MONEY? You can take withdrawals any time during the accumulation phase. Withdrawal charges may apply, as well as income taxes, and/or a penalty tax on amounts withdrawn. WHAT IS THE DEATH BENEFIT UNDER THE CONTRACT? You may choose to purchase the Standard or Enhanced Death Benefit. The death benefit applies upon the first death of the Contract Owner, joint owner, or Annuitant. Assuming you are the Annuitant, the death benefit is as follows: If you die before the Contract is in the payout phase, the person you have chosen as your beneficiary will receive a death benefit. We calculate the death benefit value at the close of the business day on which our Home Office receives (1) Due Proof of Death and (2) written payment instructions. The Enhanced Death Benefit may not be available in all states. Please refer to the Death Benefit section in the prospectus for more details. WHERE MAY I FIND OUT MORE ABOUT ACCUMULATION UNIT VALUES? The Condensed Financial Information in Appendix A or Appendix B to this prospectus provides more information about Accumulation Unit values. ARE THERE ANY ADDITIONAL FEATURES? This Contract has other features you may be interested in. These include: - DOLLAR COST AVERAGING. This is a program that allows you to invest a fixed amount of money in Variable Funding Options each month, theoretically giving you a lower average cost per unit over time than a single one-time purchase. Dollar Cost Averaging requires regular investments regardless of fluctuating price levels, and does not guarantee profits or prevent losses in a declining market. Potential investors should consider their financial ability to continue purchases through periods of low price levels. - SYSTEMATIC WITHDRAWAL OPTION. Before the Maturity Date, you can arrange to have money sent to you at set intervals throughout the year. Of course, any applicable income and penalty taxes will apply on amounts withdrawn. Withdrawals in excess of the annual free withdrawal allowance may be subject to a withdrawal charge. - AUTOMATIC REBALANCING. You may elect to have the Company periodically reallocate the values in your Contract to match the rebalancing allocation selected. - BENEFICIARY CONTRACT CONTINUANCE (NOT PERMITTED FOR NON-NATURAL BENEFICIARIES). If you die before the Maturity Date, and if the value of any beneficiary's portion of the death benefit is between $20,000 and $1,000,000 as of the date of your death, that beneficiary may elect to continue his/her portion of the Contract and take required distributions over time, rather than have the death benefit paid to the beneficiary in a lump sum. 7 FEE TABLE -------------------------------------------------------------------------------- The following tables describe the fees and expenses that you will pay when buying, owning, and surrendering the Contract. The first table describes the fees and expenses that you will pay at the time that you buy the Contract, surrender the Contract, or transfer Contract Value between Variable Funding Options. Expenses shown do not include premium taxes, which may be applicable. CONTRACT OWNER TRANSACTION EXPENSES WITHDRAWAL CHARGE:...................................... 6%(1) (as a percentage of the Purchase Payments withdrawn)
VARIABLE LIQUIDITY BENEFIT CHARGE:...................... 6%(2) (as a percentage of the present value of the remaining Annuity Payments that are surrendered. The interest rate used to calculate this present value is 1% higher than the Assumed (Daily) Net Investment Factor used to calculate the Annuity Payments.)
The next table describes the fees and expenses that you will pay periodically during the time that you own the Contract, not including Underlying Fund fees and expenses. CONTRACT ADMINISTRATIVE CHARGES ANNUAL CONTRACT ADMINISTRATIVE CHARGE:.................. $30(3)
--------- (1) The withdrawal charge declines to zero after the Purchase Payment has been in the Contract for 6 years. The charge is as follows:
YEARS SINCE PURCHASE PAYMENT MADE ------------------------------------------ GREATER THAN OR EQUAL TO BUT LESS THAN WITHDRAWAL CHARGE ------------------------ ------------- ----------------- 0 years 3 years 6% 3 years 4 years 3% 4 years 5 years 2% 5 years 6 years 1% 6 years+ 0%
(2) This withdrawal charge only applies when you surrender the Contract after beginning to receive Annuity Payments. The Variable Liquidity Benefit Charge declines to zero after six years. The charge is as follows:
YEARS SINCE INITIAL PURCHASE PAYMENT ------------------------------------------ GREATER THAN OR EQUAL TO BUT LESS THAN WITHDRAWAL CHARGE ------------------------ ------------- ----------------- 0 years 3 years 6% 3 years 4 years 3% 4 years 5 years 2% 5 years 6 years 1% 6 years+ 0%
(3) We do not assess this charge if Contract Value is $40,000 or more on the fourth Friday of each August. 8 ANNUAL SEPARATE ACCOUNT CHARGES: (as a percentage of the average daily net assets of the Separate Account)
------------------------------------------------------------------------------------------------ STANDARD ENHANCED DEATH DEATH BENEFIT BENEFIT ------------------------------------------------------------------------------------------------ Mortality and Expense Risk Charge 1.02%(1) Mortality and Expense Risk Charge 1.30%(1) Administrative Expense Charge 0.15% Administrative Expense Charge 0.15% ---- ---- Total Annual Separate Account Total Separate Account Charges 1.45% Charges 1.17% ------------------------------------------------------------------------------------------------
--------- (1) We will waive the following amount of the Mortality and Expense Risk Charge: an amount, if any, equal to the Underlying Fund expenses that are in excess of the indicated percentages for the Subaccounts investing in each of the following portfolios: 0.91% for the Subaccount investing in the Capital Guardian U.S. Equity Portfolio -- Class A; and 0.84% for the Subaccount investing in the T. Rowe Price Small Cap Growth Portfolio -- Class B. UNDERLYING FUND EXPENSES AS OF DECEMBER 31, 2007 (UNLESS OTHERWISE INDICATED): The first table below shows the range (minimum and maximum) of the total annual operating expenses charged by all of the Underlying Funds, before any voluntary or contractual fee waivers and/or expense reimbursements. The second table shows each Underlying Fund's management fee, distribution and/or service (12b-1) fees if applicable, and other expenses. The Underlying Funds provided this information and we have not independently verified it. More detail concerning each Underlying Fund's fees and expenses is contained in the prospectus for each Underlying Fund. Current prospectuses for the Underlying Funds can be obtained by calling 800-842-9325. MINIMUM AND MAXIMUM TOTAL ANNUAL UNDERLYING FUND OPERATING EXPENSES
MINIMUM MAXIMUM ------- ------- TOTAL ANNUAL FUND OPERATING EXPENSES (expenses that are deducted from Underlying Fund assets, including management fees, distribution and/or service (12b-1) fees, and other expenses) 0.52% 1.11%
UNDERLYING FUND FEES AND EXPENSES (as a percentage of average daily net assets)
DISTRIBUTION TOTAL CONTRACTUAL FEE NET TOTAL AND/OR ANNUAL WAIVER ANNUAL MANAGEMENT SERVICE OTHER ACQUIRED FUND FEES OPERATING AND/OR EXPENSE OPERATING UNDERLYING FUND FEE (12b-1) FEES EXPENSES AND EXPENSES* EXPENSES REIMBURSEMENT EXPENSES** --------------- ---------- ------------ -------- ------------------ --------- --------------- --------------- AMERICAN FUNDS INSURANCE SERIES(R) -- CLASS 2 American Funds Global Growth Fund........................ 0.53% 0.25% 0.02% -- 0.80% -- 0.80% American Funds Growth Fund..... 0.32% 0.25% 0.01% -- 0.58% -- 0.58% American Funds Growth-Income Fund........................ 0.26% 0.25% 0.01% -- 0.52% -- 0.52% LEGG MASON PARTNERS VARIABLE EQUITY TRUST Legg Mason Partners Variable Aggressive Growth Portfolio -- Class I++...... 0.75% -- 0.07% -- 0.82% -- 0.82%(1) Legg Mason Partners Variable Capital and Income Portfolio -- Class I........ 0.75% -- 0.13% -- 0.88% -- 0.88% Legg Mason Partners Variable Dividend Strategy Portfolio++++............... 0.65% -- 0.33% -- 0.98% -- 0.98%(1) Legg Mason Partners Variable Equity Index Portfolio -- Class II....... 0.31% 0.25% 0.08% -- 0.64% -- 0.64%(1) Legg Mason Partners Variable Fundamental Value Portfolio -- Class I++...... 0.75% -- 0.08% -- 0.83% -- 0.83%(1) Legg Mason Partners Variable International All Cap Opportunity Portfolio++..... 0.85% -- 0.26% -- 1.11% -- 1.11%(1)
9
DISTRIBUTION TOTAL CONTRACTUAL FEE NET TOTAL AND/OR ANNUAL WAIVER ANNUAL MANAGEMENT SERVICE OTHER ACQUIRED FUND FEES OPERATING AND/OR EXPENSE OPERATING UNDERLYING FUND FEE (12b-1) FEES EXPENSES AND EXPENSES* EXPENSES REIMBURSEMENT EXPENSES** --------------- ---------- ------------ -------- ------------------ --------- --------------- --------------- Legg Mason Partners Variable Investors Portfolio -- Class I........................... 0.62% -- 0.14% -- 0.76% -- 0.76%(1) Legg Mason Partners Variable Large Cap Growth Portfolio -- Class I++++.... 0.75% -- 0.15% -- 0.90% -- 0.90%(2) Legg Mason Partners Variable Lifestyle Allocation 50%++++..................... -- -- 0.10% 0.68% 0.78% -- 0.78%(3) Legg Mason Partners Variable Lifestyle Allocation 70%++++..................... -- -- 0.15% 0.74% 0.89% -- 0.89%(3) Legg Mason Partners Variable Lifestyle Allocation 85%++++..................... -- -- 0.23% 0.82% 1.05% -- 1.05%(3) Legg Mason Partners Variable Small Cap Growth Portfolio -- Class I........ 0.75% -- 0.35% -- 1.10% -- 1.10%(1) LEGG MASON PARTNERS VARIABLE INCOME TRUST Legg Mason Partners Variable High Income Portfolio++..... 0.60% -- 0.15% -- 0.75% -- 0.75%(1) Legg Mason Partners Variable Money Market Portfolio++.... 0.45% -- 0.08% -- 0.53% -- 0.53%(1) MET INVESTORS SERIES TRUST BlackRock Large Cap Core Portfolio -- Class E........ 0.58% 0.15% 0.06% -- 0.79% -- 0.79% Lazard Mid Cap Portfolio -- Class A........ 0.69% -- 0.07% -- 0.76% -- 0.76% Lord Abbett Bond Debenture Portfolio -- Class A........ 0.49% -- 0.05% -- 0.54% -- 0.54% Met/AIM Capital Appreciation Portfolio -- Class A........ 0.76% -- 0.10% -- 0.86% -- 0.86% Pioneer Strategic Income Portfolio -- Class A........ 0.60% -- 0.09% -- 0.69% -- 0.69%(4) METROPOLITAN SERIES FUND, INC. BlackRock Aggressive Growth Portfolio -- Class D........ 0.71% 0.10% 0.05% -- 0.86% -- 0.86% BlackRock Bond Income Portfolio -- Class E........ 0.38% 0.15% 0.06% -- 0.59% 0.01% 0.58%(5) Capital Guardian U.S. Equity Portfolio -- Class A........ 0.66% -- 0.05% -- 0.71% -- 0.71% FI Large Cap Portfolio -- Class A........................... 0.77% -- 0.07% -- 0.84% -- 0.84% MFS(R) Total Return Portfolio -- Class F........ 0.53% 0.20% 0.05% -- 0.78% -- 0.78% T. Rowe Price Large Cap Growth Portfolio -- Class B........ 0.60% 0.25% 0.07% -- 0.92% -- 0.92% T. Rowe Price Small Cap Growth Portfolio -- Class B........ 0.51% 0.25% 0.08% -- 0.84% -- 0.84% Western Asset Management Strategic Bond Opportunities Portfolio -- Class A........ 0.61% -- 0.05% -- 0.66% -- 0.66%
--------- * Acquired Fund Fees and Expenses are fees and expenses incurred indirectly by a portfolio as a result of investing in shares of one or more underlying portfolios. ** Net Total Annual Operating Expenses do not reflect: (1) voluntary waivers of fees or expenses; (2) contractual waivers that are in effect for less than one year from the date of this Prospectus; or (3) expense reductions resulting from custodial fee credits or directed brokerage arrangements. ++ Closed to new investments except under dollar cost averaging and rebalancing programs in existence at the time of closing. ++ Fees and expenses of this Portfolio are based on the Portfolio's fiscal year ended October 31, 2007. ++++ Fees and expenses of this Portfolio are based on the Portfolio's fiscal year ended January 31, 2008. (1) Other Expenses have been revised to reflect the estimated effect of additional prospectus and shareholder report printing and mailing expenses expected to be incurred by the fund going forward. (2) Other Expenses have been revised to reflect the estimated effect of additional prospectus and shareholder report printing and mailing expenses expected to be incurred by the fund going forward. Due to contractual waivers and/or reimbursements in place through March 1, 2009, the Portfolio's actual total net operating expenses, excluding brokerage, taxes, interest and extraordinary expenses, are not expected to exceed 0.78% prior to that date. 10 (3) The Portfolio is a "fund of funds" that invests substantially all of its assets in other Legg Mason-affiliated portfolios. Because the Portfolio invests in other underlying portfolios, the Portfolio will bear its pro rata portion of the operating expenses of the underlying portfolios in which the Portfolio invests, including the management fee. Other Expenses have been revised to reflect the estimated effect of additional prospectus and shareholder report printing and mailing expenses expected to be incurred by the fund going forward. (4) The Management Fee has been restated to reflect an amended management fee agreement, as if the agreement had been in effect during the preceding fiscal year. (5) MetLife Advisers, LLC has contractually agreed, for the period April 28, 2008 through April 30, 2009, to reduce the Management Fee for each Class of the Portfolio to the annual rate of 0.325% for the amounts over $1 billion but less than $2 billion. EXAMPLE The example is intended to help you compare the cost of investing in the Contract with the cost of investing in other variable annuity contracts. These costs include Contract Owner transaction expenses, contract fees, separate account annual expenses, and Underlying Fund total annual operating expenses. The example does not represent past or future expenses. Your actual expenses may be more or less than those shown. The example assumes that you invest $10,000 in the Contract for the time periods indicated and that your investment has a 5% return each year. The example reflects the annual contract administrative charge, factoring in that the charge is waived for contracts over a certain value. Additionally, the example is based on the minimum and maximum Underlying Fund total annual operating expenses shown above, and does not reflect any Underlying Fund fee waivers and/or expense reimbursements. The example assumes you have allocated all of your Contract Value to either the Underlying Fund with the maximum total annual operating expenses or the Underlying Fund with the minimum total annual operating expenses.
IF CONTRACT IS SURRENDERED AT THE IF CONTRACT IS NOT SURRENDERED OR END OF PERIOD SHOWN: ANNUITIZED AT THE END OF PERIOD SHOWN: ---------------------------------------------- ---------------------------------------------- FUNDING OPTION 1 YEAR 3 YEARS 5 YEARS 10 YEARS 1 YEAR 3 YEARS 5 YEARS 10 YEARS -------------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- Underlying Fund with Maximum Total Annual Operating Expenses......... $864 $1,321 $1,553 $2,932 $264 $811 $1,383 $2,932 Underlying Fund with Minimum Total Annual Operating Expenses......... $805 $1,144 $1,257 $2,341 $205 $634 $1,087 $2,341
CONDENSED FINANCIAL INFORMATION -------------------------------------------------------------------------------- See Appendices A and B. THE ANNUITY CONTRACT -------------------------------------------------------------------------------- Vintage Annuity is a contract between the Contract Owner ("you") and the Company. This is the prospectus -- it is not the Contract. The prospectus highlights many Contract provisions to focus your attention on the Contract's essential features. Your rights and obligations under the Contract will be determined by the language of the Contract itself. When you receive your Contract, we suggest you read it promptly and carefully. There may be differences in your Contract from the descriptions in this prospectus because of the requirements of the state where we issued your Contract. We will include any such differences in your Contract. The Company offers several different annuities that your investment professional may be authorized to offer to you. Each annuity offers different features and benefits that may be appropriate for you. In particular, the annuities differ based on variations in the standard and optional death benefit protection provided for your beneficiaries, the availability of optional living benefits, the ability to access your Contract Value if necessary and the charges that you will be subject to if you make a withdrawal or surrender the annuity. The separate account charges and other charges may be different between each annuity we offer. Optional death benefits and living benefits are subject to a separate charge for the additional protections they offer to you and your beneficiaries. Furthermore, annuities that offer greater flexibility to access your Contract Value generally are subject to higher separate account charges than annuities that deduct charges if you make a withdrawal or surrender. 11 We encourage you to evaluate the fees, expenses, benefits and features of this annuity against those of other investment products, including other annuity products offered by us and other insurance companies. Before purchasing this or any other investment product you should consider whether the product you purchase is consistent with your risk tolerance, investment objectives, investment time horizon, financial and tax situation, liquidity needs and how you intend to use the annuity. You make Purchase Payments to us and we credit them to your Contract. We promise to pay you an income, in the form of Annuity Payments, beginning on a future date that you choose, the Maturity Date. The Purchase Payments accumulate tax deferred in the funding options of your choice. We offer multiple Variable Funding Options. We may also offer a Fixed Account option. The Contract Owner assumes the risk of gain or loss according to the performance of the Variable Funding Options. The Contract Value is the amount of Purchase Payments, plus or minus any investment experience on the amounts you allocate to the Separate Account ("Separate Account Contract Value") or interest on the amounts you allocate to the Fixed Account ("Fixed Account Contract Value"). The Contract Value also reflects all withdrawals made and charges deducted. There is generally no guarantee that at the Maturity Date the Contract Value will equal or exceed the total Purchase Payments made under the Contract. The date the Contract and its benefits become effective is referred to as the Contract Date. Each 12-month period following the Contract Date is called a Contract Year. Certain changes and elections must be made in writing to the Company. Where the term "Written Request" is used, it means that you must send written information to our Home Office in a form and content satisfactory to us. The Contract is not offered to new purchasers.
MAXIMUM AGE BASED ON THE OLDER OF THE OWNER AND DEATH BENEFIT/OPTIONAL FEATURE ANNUITANT ON THE CONTRACT DATE ------------------------------------------------------ ----------------------------------------------- Standard Death Benefit 80 Enhanced Death Benefit 75
Since optional death benefits carry higher charges, you should consider the ages of the owner and Annuitant when electing these benefits, as the additional value provided by the benefit may be significantly reduced or eliminated depending on the ages of the owner and Annuitant at the time of election. Purchase of this Contract through a tax qualified retirement plan or IRA does not provide any additional tax deferral benefits beyond those provided by the plan or the IRA. Accordingly, if you are purchasing this Contract through a plan or IRA, you should consider purchasing this Contract for its death benefit, annuity option benefits, and other non-tax-related benefits. You should consult with your tax adviser to determine if this Contract is appropriate for you. CONTRACT OWNER INQUIRIES Any questions you have about your Contract should be directed to our Home Office at 800-842-9325. PURCHASE PAYMENTS Your initial Purchase Payment is due and payable before the Contract becomes effective. The initial Purchase Payment must be at least $5,000. You may make additional payments of at least $500 at any time. No additional Purchase Payments are allowed if this Contract is purchased with a beneficiary-directed transfer of death benefit proceeds. Under certain circumstances, we may waive the minimum Purchase Payment requirement. Purchase Payments over $1,000,000 may be made only with our prior consent. Purchase Payments may be made at any time while the Annuitant is alive and before the date Annuity Payments begin. We accept Purchase Payments made by check or cashier's check. We do not accept cash, money orders or traveler's checks. We reserve the right to refuse Purchase Payments made via a personal check in excess of $100,000. Purchase Payments over $100,000 may be accepted in other forms, including but not limited to, EFT/wire transfers, certified checks, corporate checks, and checks written on financial institutions. The form in which we receive a Purchase Payment may determine how soon subsequent disbursement requests may be fulfilled. (See "Access To Your Money.") 12 We will apply the initial Purchase Payment less any applicable premium tax within two business days after we receive it at our Home Office with a properly completed application or order request. If your request or other information accompanying the initial Purchase Payment is incomplete when received, we will hold the Purchase Payment for up to five business days. If we cannot obtain the necessary information within five business days, we will return the Purchase Payment in full, unless you specifically consent for us to keep it until you provide the necessary information. We will credit any subsequent Purchase Payment to a Contract on the same business day we receive it, if it is received in good order by our Home Office by 4:00 p.m. Eastern time. A business day is any day that the New York Stock Exchange is open for regular trading (except when trading is restricted due to an emergency as defined by the Securities and Exchange Commission). IF YOU SEND YOUR PURCHASE PAYMENTS OR TRANSACTION REQUESTS TO AN ADDRESS OTHER THAN THE ONE WE HAVE DESIGNATED FOR RECEIPT OF SUCH PURCHASE PAYMENTS OR REQUESTS, WE MAY RETURN THE PURCHASE PAYMENT TO YOU, OR THERE MAY BE A DELAY IN APPLYING THE PURCHASE PAYMENT OR TRANSACTION TO YOUR CONTRACT. QUALIFIED CONTRACTS UNDER SECTION 403(B). If your Contract was issued as a Qualified Contract under Section 403(b) of the Code (also called a "tax sheltered annuity" or "TSA") in a 90-24 transfer completed on or before September 24, 2007, we urge you to consult with your tax advisor prior to making additional purchase payments. Such additional payments may have significant adverse tax consequences. (See "Federal Tax Consequences.") ACCUMULATION UNITS The period between the Contract Date and the Maturity Date is the accumulation period. During the accumulation period, an Accumulation Unit is used to calculate the value of a Contract. Each Variable Funding Option has a corresponding Accumulation Unit value. The Accumulation Units are valued each business day and their values may increase or decrease from day to day. The daily change in value of an Accumulation Unit each day is based on the investment performance of the corresponding Underlying Fund, and the deduction of separate account charges shown in the Fee Table in this prospectus. The number of Accumulation Units we will credit to your Contract once we receive a Purchase Payment or transfer request (or, liquidate for a withdrawal request) is determined by dividing the amount directed to each Variable Funding Option (or, taken from each Variable Funding Option) by the value of its Accumulation Unit. Normally, we calculate the value of an Accumulation Unit for each Variable Funding Option as of the close of regular trading (generally 4:00 p.m. Eastern time) each day the New York Stock Exchange is open. After the value is calculated, we credit your Contract. During the annuity period (i.e., after the Maturity Date), you are credited with Annuity Units. THE VARIABLE FUNDING OPTIONS You choose the Variable Funding Options to which you allocate your Purchase Payments. From time to time we may make new Variable Funding Options available. These Variable Funding Options are Subaccounts of the Separate Account. The Subaccounts invest in the Underlying Funds. You are not investing directly in the Underlying Fund. Each Underlying Fund is a portfolio of an open-end management investment company that is registered with the SEC under the Investment Company Act of 1940. These Underlying Funds are not publicly traded and are only offered through variable annuity contracts, variable life insurance policies, and in some instances, certain retirement plans. They are not the same as the retail mutual funds offered outside of a variable annuity or variable life insurance product, although the investment practices and fund names may be similar and the portfolio managers may be identical. Accordingly, the performance of the retail mutual fund is likely to be different from that of the Underlying Fund. We select the Underlying Funds offered through this Contract based on a number of criteria, including asset class coverage, the strength of the adviser's or subadviser's reputation and tenure, brand recognition, performance, and the capability and qualification of each investment firm. Another factor we consider during the selection process is whether the Underlying Fund's adviser or subadviser is one of our affiliates or whether the Underlying Fund, its adviser, its subadviser(s), or an affiliate will make payments to us or our affiliates. In this regard, the profit distributions we receive from our affiliated investment advisers are a component of the total revenue that we consider in configuring the features and investment choices available in the variable insurance products that we and our affiliated insurance companies issue. Since we and our affiliated insurance companies may benefit more from the allocation of assets to portfolios advised by our affiliates than those that are not, we may be more inclined to offer 13 portfolios advised by our affiliates in the variable insurance products we issue. For additional information on these arrangements, see "Payments We Receive." We review the Underlying Funds periodically and may remove an Underlying Fund or limit its availability to new Purchase Payments and/or transfers of Contract Value if we determine that the Underlying Fund no longer meets one or more of the selection criteria, and/or if the Underlying Fund has not attracted significant allocations from Contract Owners. In some cases, we have included Underlying Funds based on recommendations made by broker-dealer firms. These broker-dealer firms may receive payments from the Underlying Funds they recommend and may benefit accordingly from the allocation of Contract Value to such Underlying Funds. When the Company develops a variable product in cooperation with a fund family or distributor (e.g. a "private label" product) the Company will generally include Underlying Funds based on recommendations made by the fund family or distributor, whose selection criteria may differ from the Company's selection criteria. WE DO NOT PROVIDE ANY INVESTMENT ADVICE AND DO NOT RECOMMEND OR ENDORSE ANY PARTICULAR UNDERLYING FUND. YOU BEAR THE RISK OF ANY DECLINE IN YOUR CONTRACT VALUE RESULTING FROM THE PERFORMANCE OF THE UNDERLYING FUNDS YOU HAVE CHOSEN. If investment in the Underlying Funds or a particular Underlying Fund is no longer possible, in our judgment becomes inappropriate for purposes of the Contract, or for any other reason in our sole discretion, we may substitute another Underlying Fund or Underlying Funds without your consent. The substituted Underlying Fund may have different fees and expenses. Substitution may be made with respect to existing investments or the investment of future Purchase Payments, or both. However, we will not make such substitution without any necessary approval of the Securities and Exchange Commission and applicable state insurance departments. Furthermore, we may close Underlying Funds to allocations of Purchase Payments or Contract Value, or both, at any time in our sole discretion. In certain circumstances, the Company's ability to remove or replace an Underlying Fund may be limited by the terms of a five-year agreement between MetLife, Inc. (MetLife) and Legg Mason, Inc. (Legg Mason) relating to the use of certain Underlying Funds advised by Legg Mason affiliates. The agreement sets forth the conditions under which the Company can remove an Underlying Fund, which, in some cases, may differ from the Company's own selection criteria. In addition, during the term of the agreement, subject to the Company's fiduciary and other legal duties, the Company is generally obligated in the first instance to consider Underlying Funds advised by Legg Mason affiliates in seeking to make a substitution for an Underlying Fund advised by a Legg Mason affiliate. The agreement was originally entered into on July 1, 2005 by MetLife and certain affiliates of Citigroup Inc. (Citigroup) as part of MetLife's acquisition of The Travelers Insurance Company and The Travelers Life and Annuity Company (both of which are now MetLife Insurance Company of Connecticut) from Citigroup. Legg Mason replaced the Citigroup affiliates as a party to the agreement when Citigroup sold its asset management business to Legg Mason. The agreement also obligates Legg Mason to continue making payments to the Company with respect to Underlying Funds advised by Legg Mason affiliates, on the same terms provided for in administrative services agreements between Citigroup's asset management affiliates and the Travelers insurance companies that predate the acquisition. PAYMENTS WE RECEIVE. As described above, an investment adviser (other than our affiliates MetLife Advisers, LLC, and Met Investors Advisory LLC) or subadviser of an Underlying Fund, or its affiliates, may make payments to the Company and/or certain of its affiliates. These payments may be used for a variety of purposes, including payment of expenses for certain administrative, marketing and support services with respect to the Contracts, and, in the Company's role as an intermediary, with respect to the Underlying Funds. The Company and its affiliates may profit from these payments. These payments may be derived, in whole or in part, from the advisory fee deducted from Underlying Fund assets. Contract Owners, through their indirect investment in the Underlying Funds, bear the costs of these advisory fees (see the Underlying Funds' prospectuses for more information). The amount of the payments we receive is based on a percentage of assets of the Underlying Funds attributable to the Contracts and certain other variable insurance products that the Company and its affiliates issue. These percentages differ and some advisers or subadvisers (or other affiliates) may pay the Company more than others. These percentages currently range up to 0.50%. Additionally, an investment adviser or subadviser of an Underlying Fund or its affiliates may provide the Company with wholesaling services that assist in the distribution of the Contracts and may pay the Company and/or certain of its affiliates amounts to participate in sales meetings. These amounts may be significant and may provide the adviser or subadviser (or their affiliate) with increased access to persons involved in the distribution of the Contracts. The Company and/or certain of its affiliated insurance companies have joint ownership interests in its affiliated investment advisers MetLife Advisers, LLC and Met Investors Advisory LLC, which are formed as "limited liability 14 companies." The Company's ownership interests in MetLife Advisers, LLC and Met Investors Advisory LLC entitle us to profit distributions if the adviser makes a profit with respect to the advisory fees it receives from the Underlying Fund. The Company will benefit accordingly from assets allocated to the Underlying Funds to the extent they result in profits to the advisers. (See "Fee Table -- Underlying Fund Fees and Expenses" for information on the management fees paid by the Underlying Funds and the Statement of Additional Information for the Underlying Funds for information on the management fees paid by the advisers to the subadvisers.) Certain Underlying Funds have adopted a Distribution Plan under Rule 12b-1 of the Investment Company Act of 1940. An Underlying Fund's 12b-1 Plan, if any, is described in more detail in the Underlying Fund's prospectus. (See "Fee Table -- Underlying Fund Fees and Expenses" and "Other Information -- Distribution of Variable Annuity Contracts.") Any payments we receive pursuant to those 12b-1 Plans are paid to us or our distributor, MetLife Investors Distribution Company. Payments under an Underlying Fund's 12b-1 Plan decrease the Underlying Fund's investment return. We make certain payments to American Funds Distributors, Inc., principal underwriter for the American Funds Insurance Series. (See "Distribution of Variable Annuity Contracts.") Each Underlying Fund has different investment objectives and risks. The Underlying Fund prospectuses contain more detailed information on each Underlying Fund's investment strategy, investment advisers and its fees. You may obtain an Underlying Fund prospectus by calling 800-842-9325 or through your registered representative. We do not guarantee the investment results of the Underlying Funds. The current Underlying Funds are listed below, along with their investment advisers and any subadviser:
FUNDING INVESTMENT INVESTMENT OPTION OBJECTIVE ADVISER/SUBADVISER --------------------------------- --------------------------------- --------------------------------- AMERICAN FUNDS INSURANCE SERIES(R) -- CLASS 2 American Funds Global Growth Fund Seeks capital appreciation Capital Research and Management through stocks. Company American Funds Growth Fund Seeks capital appreciation Capital Research and Management through stocks. Company American Funds Growth-Income Fund Seeks both capital appreciation Capital Research and Management and income. Company LEGG MASON PARTNERS VARIABLE EQUITY TRUST Legg Mason Partners Variable Seeks capital appreciation. Legg Mason Partners Fund Advisor, Aggressive Growth LLC Portfolio -- Class I Subadviser: ClearBridge Advisors, LLC Legg Mason Partners Variable Seeks total return (that is, a Legg Mason Partners Fund Advisor, Capital and Income combination of income and long- LLC Portfolio -- Class I term capital appreciation). Subadvisers: Western Asset Management Company; ClearBridge Advisors, LLC; Western Asset Management Company Limited Legg Mason Partners Variable Seeks capital appreciation, Legg Mason Partners Fund Advisor, Dividend Strategy Portfolio++ principally through investments LLC in dividend-paying stocks. Subadviser: ClearBridge Advisors, LLC Legg Mason Partners Variable Seeks investment results that, Legg Mason Partners Fund Advisor, Equity Index Portfolio -- Class before expenses, correspond to LLC II the price and yield performance Subadviser: Batterymarch of the S&P 500(R) Index. Financial Management, Inc.
15
FUNDING INVESTMENT INVESTMENT OPTION OBJECTIVE ADVISER/SUBADVISER --------------------------------- --------------------------------- --------------------------------- Legg Mason Partners Variable Seeks long-term capital growth. Legg Mason Partners Fund Advisor, Fundamental Value Current income is a secondary LLC Portfolio -- Class I++ consideration. Subadviser: ClearBridge Advisors, LLC Legg Mason Partners Variable Seeks total return on assets from Legg Mason Partners Fund Advisor, International All Cap growth of capital and income. LLC Opportunity Portfolio Subadviser: Global Currents Investment Management, LLC Legg Mason Partners Variable Seeks long-term growth of Legg Mason Partners Fund Advisor, Investors Portfolio -- Class I capital. Current income is a LLC secondary objective. Subadviser: ClearBridge Advisors, LLC Legg Mason Partners Variable Seeks long-term growth of Legg Mason Partners Fund Advisor, Large Cap Growth capital. LLC Portfolio -- Class I++ Subadviser: ClearBridge Advisors, LLC Legg Mason Partners Variable Seeks a balance of growth of Legg Mason Partners Fund Advisor, Lifestyle Allocation 50% captial and income. LLC Subadviser: Legg Mason Global Asset Allocation, LLC Legg Mason Partners Variable Seeks long-term growth of Legg Mason Partners Fund Advisor, Lifestyle Allocation 70% capital. LLC Subadviser: Legg Mason Global Asset Allocation, LLC Legg Mason Partners Variable Seeks capital appreciation. Legg Mason Partners Fund Advisor, Lifestyle Allocation 85% LLC Subadviser: Legg Mason Global Asset Allocation, LLC Legg Mason Partners Variable Seeks long-term growth of Legg Mason Partners Fund Advisor, Small Cap Growth capital. LLC Portfolio -- Class I Subadviser: ClearBridge Advisors, LLC LEGG MASON PARTNERS VARIABLE INCOME TRUST Legg Mason Partners Variable High Seeks high current income. Legg Mason Partners Fund Advisor, Income Portfolio Secondarily, seeks capital LLC appreciation. Subadvisers: Western Asset Management Company; Western Asset Management Company Limited Legg Mason Partners Variable Seeks to maximize current income Legg Mason Partners Fund Advisor, Money Market Portfolio consistent with preservation of LLC capital. Subadviser: Western Asset Management Company MET INVESTORS SERIES TRUST BlackRock Large Cap Core Seeks long-term capital growth. Met Investors Advisory, LLC Portfolio -- Class E Subadviser: BlackRock Advisors, LLC Lazard Mid Cap Portfolio -- Class Seeks long-term growth of Met Investors Advisory, LLC A capital. Subadviser: Lazard Asset Management LLC Lord Abbett Bond Debenture Seeks high current income and the Met Investors Advisory, LLC Portfolio -- Class A opportunity for capital Subadviser: Lord, Abbett & Co. appreciation to produce a high LLC total return.
16
FUNDING INVESTMENT INVESTMENT OPTION OBJECTIVE ADVISER/SUBADVISER --------------------------------- --------------------------------- --------------------------------- Met/AIM Capital Appreciation Seeks capital appreciation. Met Investors Advisory, LLC Portfolio -- Class A Subadviser: Invesco Aim Capital Management, Inc. Pioneer Strategic Income Seeks a high level of current Met Investors Advisory, LLC Portfolio -- Class A income. Subadviser: Pioneer Investment Management, Inc. METROPOLITAN SERIES FUND, INC. BlackRock Aggressive Growth Seeks maximum capital MetLife Advisers, LLC Portfolio -- Class D appreciation. Subadviser: BlackRock Advisors, LLC BlackRock Bond Income Seeks a competitive total return MetLife Advisers, LLC Portfolio -- Class E primarily from investing in Subadviser: BlackRock Advisors, fixed-income securities. LLC Capital Guardian U.S. Equity Seeks long-term growth of MetLife Advisers, LLC Portfolio -- Class A capital. Subadviser: Capital Guardian Trust Company FI Large Cap Portfolio -- Class A Seeks long-term growth of MetLife Advisers, LLC capital. Subadviser: Pyramis Global Advisors, LLC MFS(R) Total Return Seeks a favorable total return MetLife Advisers, LLC Portfolio -- Class F through investment in a Subadviser: Massachusetts diversified portfolio. Financial Services Company T. Rowe Price Large Cap Growth Seeks long-term growth of capital MetLife Advisers, LLC Portfolio -- Class B and, secondarily, dividend Subadviser: T. Rowe Price income. Associates, Inc. T. Rowe Price Small Cap Growth Seeks long-term capital growth. MetLife Advisers, LLC Portfolio -- Class B Subadviser: T. Rowe Price Associates, Inc. Western Asset Management Seeks to maximize total return MetLife Advisers, LLC Strategic Bond Opportunities consistent with preservation of Subadviser: Western Asset Portfolio -- Class A capital. Management Company
--------- ++ Closed to new investments except under dollar cost averaging and rebalancing programs in existence at the time of closing. Certain Variable Funding Options may have been subject to a merger, substitution or other change. Please see "Appendix C -- Additional Information Regarding Underlying Funds." FIXED ACCOUNT -------------------------------------------------------------------------------- We may offer our Fixed Account as a funding option. Please refer to your Contract and Appendix D for more information. CHARGES AND DEDUCTIONS -------------------------------------------------------------------------------- GENERAL We deduct the charges described below. The charges are for the services and benefits we provide, costs and expenses we incur, and risks we assume under the Contracts. Services and benefits we provide include: - the ability for you to make withdrawals and surrenders under the Contracts - the death benefit paid on the death of the Contract Owner, Annuitant, or first of the joint owners 17 - the available funding options and related programs (including dollar cost averaging, portfolio rebalancing, and systematic withdrawal programs) - administration of the annuity options available under the Contracts - the distribution of various reports to Contract Owners Costs and expenses we incur include: - losses associated with various overhead and other expenses associated with providing the services and benefits provided by the Contracts - sales and marketing expenses including commission payments to your registered representative - other costs of doing business Risks we assume include: - that Annuitants may live longer than estimated when the annuity factors under the Contracts were established - that the amount of the death benefit will be greater than the Contract Value - that the costs of providing the services and benefits under the Contracts will exceed the charges deducted We may also deduct a charge for taxes. Unless otherwise specified, charges are deducted proportionately from all funding options in which you are invested. We may reduce or eliminate the withdrawal charge, the administrative charges and/or the mortality and expense risk charge under the Contract when certain sales or administration of the Contract result in savings or reduced expenses and/or risks. For certain trust, we may change the order in which Purchase Payments and earnings are withdrawn in order to determine the withdrawal charge. We will not reduce or eliminate the withdrawal charge or the administrative charge where such reduction or elimination would be unfairly discriminatory to any person. The amount of a charge may not necessarily correspond to the costs associated with providing the services or benefits indicated by the designated charge. For example, the withdrawal charge we collect may not fully cover all of the sales and distribution expenses we actually incur. The amount of any fee or charge is not impacted by an outstanding loan. We may also profit on one or more of the charges. We may use any such profits for any corporate purpose, including the payment of sales expenses. WITHDRAWAL CHARGE We do not deduct a sales charge from Purchase Payments when they are made to the Contract. However, a withdrawal charge will apply if Purchase Payments are withdrawn before they have been in the Contract for six years. (This includes withdrawals resulting from a request to divide the Contract Value due to divorce.) We will assess the charge as a percentage of the Purchase Payment withdrawn as follows:
YEARS SINCE PURCHASE PAYMENT MADE ------------------------------------------ GREATER THAN OR EQUAL TO BUT LESS THAN WITHDRAWAL CHARGE ------------------------ ------------- ----------------- 0 years 3 years 6% 3 years 4 years 3% 4 years 5 years 2% 5 years 6 years 1% 6+years 0%
18 FREE WITHDRAWAL ALLOWANCE Beginning in the second Contract Year, you may withdraw up to 15% of the Contract Value annually, without a withdrawal charge. We calculate the available withdrawal amount as of the end of the previous Contract Year. The free withdrawal provision applies to partial and full withdrawals. Any withdrawal is subject to federal income taxes on the taxable portion. In addition, a 10% federal penalty may be assessed on any withdrawal if the Contract Owner is under age 59 1/2. You should consult with your tax adviser regarding the tax consequences of a withdrawal. ADMINISTRATIVE CHARGES There are two administrative charges: the $30 annual Contract administrative charge and the administrative expense charge. The annual Contract administrative charge will be deducted on a pro-rata basis from amounts allocated to the Variable Funding Options. We will deduct this charge on the fourth Friday of each August. This charge compensates us for expenses incurred in establishing and maintaining the Contract and we will prorate this charge (i.e. calculate) from the date of purchase. We will prorate this charge if you surrender your Contract, or if we terminate your Contract. We will not deduct a Contract administrative charge from the Fixed Account, if it is available, or: (1) from the distribution of death proceeds; (2) after an annuity payout has begun; or (3) if the Contract Value on the date of assessment equals or is greater than $40,000. We deduct the administrative expense charge (sometimes called "Subaccount administrative charge") on each business day from amounts allocated to the Variable Funding Options to compensate the Company for certain related administrative and operating expenses. The charge equals, on an annual basis, 0.15% of the daily net asset value allocated to each of the Variable Funding Options, and is reflected in our Accumulation and Annuity Unit value calculations. MORTALITY AND EXPENSE RISK CHARGE Each business day, we deduct a mortality and expense risk ("M&E") charge from amounts held in the Variable Funding Options. We reflect the deduction in our calculation of Accumulation and Annuity Unit values. The charges stated are the maximum for this product. We reserve the right to lower this charge at any time. If you choose the Standard Death Benefit, the M&E charge is 1.02% annually. If you choose the Enhanced Death Benefit, the M&E charge is 1.30% annually. This charge compensates the Company for risks assumed, benefits provided and expenses incurred, including the payment of commissions to your registered representative. VARIABLE LIQUIDITY BENEFIT CHARGE If the Variable Liquidity Benefit is selected, there is a maximum charge of 6% of the amounts withdrawn. This charge is not assessed during the accumulation phase. We will assess the charge as a percentage of the total benefit received as follows:
YEARS SINCE INITIAL PURCHASE PAYMENT MADE ------------------------------------------ GREATER THAN OR EQUAL TO BUT LESS THAN WITHDRAWAL CHARGE ------------------------ ------------- ----------------- 0 years 3 years 6% 3 years 4 years 3% 4 years 5 years 2% 5 years 6 years 1% 6+years 0%
Please refer to "Payment Options" for a description of this benefit. 19 VARIABLE FUNDING OPTION EXPENSES We summarized the charges and expenses of the Underlying Funds in the fee table. Please review the prospectus for each Underlying Fund for a more complete description of that fund and its expenses. Underlying Fund expenses are not fixed or guaranteed and are subject to change by the Fund. PREMIUM TAX Certain state and local governments charge premium taxes ranging from 0% to 3.5%, depending upon jurisdiction. We are responsible for paying these taxes and will determine the method used to recover premium tax expenses incurred. We will deduct any applicable premium taxes from your Contract Value either upon death, surrender, annuitization, or at the time you make Purchase Payments to the Contract, but no earlier than when we have a tax liability under state law. CHANGES IN TAXES BASED UPON PREMIUM OR VALUE If there is any change in a law assessing taxes against the Company based upon premiums, contract gains or value of the Contract, we reserve the right to charge you proportionately for this tax. TRANSFERS -------------------------------------------------------------------------------- Subject to the limitations described below, you may transfer all or part of your Contract Value between Variable Funding Options at any time up to 30 days before the Maturity Date. After the Maturity Date, you may make transfers only if allowed by your Contract or with our consent. Transfer requests received at our Home Office that are in good order before the close of the New York Stock Exchange (NYSE) will be processed according to the value(s) next computed following the close of business. Transfer requests received on a non-business day or after the close of the NYSE will be processed based on the value(s) next computed on the next business day. Where permitted by state law, we reserve the right to restrict transfers from the Variable Funding Options to the Fixed Account whenever the credited interest rate on the Fixed Account is equal to the minimum guaranteed interest rate specified under the Contract. Currently, there are no charges for transfers; however, we reserve the right to charge a fee for any transfer request which exceeds twelve per year. Since each Underlying Fund may have different overall expenses, a transfer of Contract Values from one Variable Funding Option to another could result in your investment becoming subject to higher or lower expenses. Also, when making transfers, you should consider the inherent risks associated with the Variable Funding Options to which your Contract Value is allocated. MARKET TIMING/EXCESSIVE TRADING Frequent requests from Contract Owners to transfer Contract Value may dilute the value of an Underlying Fund's shares if the frequent trading involves an attempt to take advantage of pricing inefficiencies created by a lag between a change in the value of the securities held by the Underlying Fund and the reflection of that change in the Underlying Fund's share price ("arbitrage trading"). Regardless of the existence of pricing inefficiencies, frequent transfers may also increase brokerage and administrative costs of the Underlying Funds and may disrupt Underlying Fund management strategy, requiring an Underlying Fund to maintain a high cash position and possibly resulting in lost investment opportunities and forced liquidations ("disruptive trading"). Accordingly, arbitrage trading and disruptive trading activities (referred to collectively as "market timing") may adversely affect the long-term performance of the Underlying Funds, which may in turn adversely affect Contract Owners and other persons who may have an interest in the Contracts (e.g., annuitants and beneficiaries). We have policies and procedures that attempt to detect and deter frequent transfers in situations where we determine there is a potential for arbitrage trading. Currently, we believe that such situations may be presented in the international, small-cap, and high-yield Underlying Funds, i.e., American Funds Global Growth Fund, Legg Mason Partners Variable International All Cap Opportunity Portfolio, Legg Mason Partners Variable Small Cap Growth Portfolio, Legg Mason Variable High Income Portfolio, Lord Abbett Bond Debenture Portfolio, Pioneer Strategic 20 Income Portfolio, T. Rowe Price Small Cap Growth Portfolio, and Western Asset Management Strategic Bond Opportunities Portfolio (the "Monitored Portfolios"), and we monitor transfer activity in those Monitored Portfolios. In addition, as described below, we treat all American Funds Insurance Series portfolios ("American Funds portfolios") as Monitored Portfolios. We employ various means to monitor transfer activity, such as examining the frequency and size of transfers into and out of the Monitored Portfolios within given periods of time. For example, we currently monitor transfer activity to determine if, for each of the Monitored Portfolios, in a three-month period there were two or more "round- trips" of a certain dollar amount or greater. A round-trip is defined as a transfer in followed by a transfer out within the next 10 calendar days, or a transfer out followed by a transfer in within the next 10 calendar days. In the case of a Contract that has been restricted previously, a single round-trip of a certain dollar amount or greater will trigger the transfer restrictions described below. We do not believe that other Underlying Funds present a significant opportunity to engage in arbitrage trading and therefore do not monitor transfer activity in those Underlying Funds. We may change the Monitored Portfolios at any time without notice in our sole discretion. In addition to monitoring transfer activity in certain Underlying Funds, we rely on the Underlying Funds to bring any potential disruptive trading activity they identify to our attention for investigation on a case-by-case basis. We will also investigate other harmful transfer activity that we identify from time to time. We may revise these policies and procedures in our sole discretion at any time without prior notice. AMERICAN FUNDS MONITORING POLICY. As a condition to making their portfolios available in our products, American Funds requires us to treat all American Funds portfolios as Monitored Portfolios under our current market timing and excessive trading policies and procedures. Further, American Funds requires us to impose additional specified monitoring criteria for all American Funds portfolios available under the Contract, regardless of the potential for arbitrage trading. We are required to monitor transfer activity in American Funds portfolios to determine if there were two or more transfers in followed by transfers out, in each case of a certain dollar amount or greater, in any 30-day period. A first violation of the American Funds monitoring policy will result in a written notice of violation; any additional violation will result in the imposition of the transfer restrictions described below. Further, as Monitored Portfolios, American Funds portfolios also will be subject to our current market timing and excessive trading policies, procedures and restrictions, and transfer restrictions may be imposed upon a violation of either monitoring policy. Our policies and procedures may result in transfer restrictions being applied to deter market timing. Currently, when we detect transfer activity in the Monitored Portfolios that exceeds our current transfer limits, or other transfer activity that we believe may be harmful to other Owners or other persons who have an interest in the Contracts, we will exercise our contractual right to restrict your number of transfers to one every six months. In addition, we also reserve the right, but do not have the obligation, to further restrict the right to request transfers by any market timing firm or any other third party who has been authorized to initiate transfers on behalf of multiple Contract Owners. We may, among other things: - reject the transfer instructions of any agent acting under a power of attorney on behalf of more than one Owner, or - reject the transfer or exchange instructions of individual Owners who have executed pre-authorized transfer forms which are submitted by market timing firms or other third parties on behalf of more than one Owner. Transfers made under a Dollar Cost Averaging Program, a rebalancing program or, if applicable, any asset allocation program described in this prospectus are not treated as transfers when we evaluate trading patterns for market timing. The detection and deterrence of harmful transfer activity involves judgments that are inherently subjective, such as the decision to monitor only those Underlying Funds that we believe are susceptible to arbitrage trading or the determination of the transfer limits. Our ability to detect and/or restrict such transfer activity may be limited by operational and technological systems, as well as our ability to predict strategies employed by Owners to avoid such detection. Our ability to restrict such transfer activity also may be limited by provisions of the Contract. Accordingly, there is no assurance that we will prevent all transfer activity that may adversely affect Owners and other persons with interests in the Contracts. We do not accommodate market timing in any Underlying Fund and there are no arrangements in place to permit any Contract Owner to engage in market timing; we apply our policies and procedures without exception, waiver, or special arrangement. The Underlying Funds may have adopted their own policies and procedures with respect to frequent purchases and redemptions of their respective shares and we reserve the right to enforce these policies and procedures. For 21 example, Underlying Funds may assess a redemption fee (which we reserve the right to collect) on shares held for a relatively short period. The prospectuses for the Underlying Funds describe any such policies and procedures, which may be more or less restrictive than the policies and procedures we have adopted. Although we may not have the contractual authority or the operational capacity to apply the frequent trading policies and procedures of the Underlying Funds, we have entered into a written agreement, as required by SEC regulation, with each Underlying Fund or its principal underwriter that obligates us to provide to the Underlying Fund promptly upon request certain information about the trading activity of individual Contract Owners, and to execute instructions from the Underlying Fund to restrict or prohibit further purchases or transfers by specific Contract Owners who violate the frequent trading policies established by the Underlying Fund. In addition, Contract Owners and other persons with interests in the contracts should be aware that the purchase and redemption orders received by the Underlying Funds generally are "omnibus" orders from intermediaries, such as separate accounts funding variable insurance contracts or retirement plans. The omnibus orders reflect the aggregation and netting of multiple orders from individual owners of variable insurance contracts and/or individual retirement plan participants. The omnibus nature of these orders may limit the Underlying Funds in their ability to apply their frequent trading policies and procedures. In addition, the other insurance companies and/or retirement plans may have different policies and procedures or may not have any such policies and procedures because of contractual limitations. For these reasons, we cannot guarantee that the Underlying Funds (and thus Contract Owners) will not be harmed by transfer activity relating to other insurance companies and/or retirement plans that may invest in the Underlying Funds. If an Underlying Fund believes that an omnibus order reflects one or more transfer requests from Contract Owners engaged in disruptive trading activity, the Underlying Fund may reject the entire omnibus order. In accordance with applicable law, we reserve the right to modify or terminate the transfer privilege at any time. We also reserve the right to defer or restrict the transfer privilege at any time that we are unable to purchase or redeem shares of any of the Underlying Funds, including any refusal or restriction on purchases or redemptions of their shares as a result of their own policies and procedures on market timing activities (even if an entire omnibus order is rejected due to the market timing activity of a single Contract Owner). You should read the Underlying Fund prospectuses for more details. DOLLAR COST AVERAGING Dollar cost averaging or the pre-authorized transfer program (the "DCA Program") allows you to transfer a set dollar amount to other funding options on a monthly or quarterly basis during the accumulation phase of the Contract. Using this method, you will purchase more Accumulation Units in a funding option if the value per unit is low and will purchase fewer Accumulation Units if the value per unit is high. Therefore, you may achieve a lower-than-average cost per unit in the long run if you have the financial ability to continue the program over a long enough period of time. Dollar cost averaging does not assure a profit or protect against a loss. You may elect the DCA Program through Written Request or other method acceptable to us. You must have a minimum total Contract Value of $5,000 to enroll in the DCA Program. The minimum amount that may be transferred through this program is $400. There is no additional fee to participate in the DCA Program. You may establish pre-authorized transfers of Contract Values from the Fixed Account, subject to certain restrictions. Under the DCA Program, automated transfers from the Fixed Account may not deplete your Fixed Account Value in less than twelve months from your enrollment in the DCA Program. In addition to the DCA Program, within the Fixed Account, we may credit increased interest rates to Contract Owners under an administrative Special DCA Program established at our discretion, depending on availability and state law. Under this program, the Contract Owner may pre-authorize level transfers to any of the funding options under a 6 Month, 12 Month or 24 Month Special DCA Program. The programs may have different credited interest rates. We must transfer all Purchase Payments and accrued interest on a level basis to the selected funding options in the applicable time period. Under each program, the interest will accrue only on the remaining amounts in the Special DCA Program. For example, under the 12 Month program, the interest rate can accrue up to 12 months on the remaining amounts in the Special DCA Program and we must transfer all Purchase Payments and accrued interest in this program on a level basis to the selected funding options in 12 months. 22 The pre-authorized transfers will begin after the initial program Purchase Payment and complete enrollment instructions are received by the Company. If we do not receive complete program enrollment instructions within 15 days of receipt of the initial program Purchase Payment, the entire balance in the program will be credited with the non-program interest rate then in effect for the Fixed Account. You may start or stop participation in the DCA Program at any time, but you must give the Company at least 30 days' notice to change any automated transfer instructions that are currently in place. If you stop the Special DCA Program and elect to remain in the Fixed Account, we will credit your Contract Value for the remainder of 6 or 12 months with the interest rate for non-DCA Program funds. You may only have one DCA Program or Special DCA Program in place at one time. We will allocate any subsequent Purchase Payments we receive within the DCA Program period selected to the current funding options over the remainder of that DCA Program transfer period, unless you direct otherwise. All provisions and terms of the Contract apply to the DCA and Special DCA Programs, including provisions relating to the transfer of money between funding options. Transfers made under any DCA Program will not be counted for purposes of restrictions we may impose on the number of transfers permitted under the Contract. We reserve the right to suspend or modify transfer privileges at any time and to assess a processing fee for this service. If the Fixed Account is not available as a funding option, you may still participate in the DCA Program. ACCESS TO YOUR MONEY -------------------------------------------------------------------------------- Any time before the Maturity Date, you may redeem all or any portion of the Cash Surrender Value, that is, the Contract Value less any withdrawal charge, outstanding loans, and any premium tax not previously deducted. Unless you submit a Written Request specifying the Variable Funding Option(s) and/or the Fixed Account from which we are to withdraw amounts, we will make the withdrawal on a pro rata basis. We will determine the Cash Surrender Value as of the close of business after we receive your surrender request at our Home Office. The Cash Surrender Value may be more or less than the Purchase Payments you made. You may not make withdrawals during the annuity period. For amounts allocated to the Variable Funding Options, we may defer payment of any Cash Surrender Value for a period of up to five business days after the Written Request is received. For amounts allocated to the Fixed Account, we may defer payment of any Cash Surrender Value for a period up to six months. In either case, it is our intent to pay as soon as possible. We cannot process requests for withdrawals that are not in good order. We will contact you if there is a deficiency causing a delay and will advise what is needed to act upon the withdrawal request. We may withhold payment of surrender, loan or withdrawal proceeds if any portion of those proceeds would be derived from a Contract Owner's check that has not yet cleared (i.e., that could still be dishonored by your banking institution). We may use telephone, fax, Internet or other means of communications to verify that payment from the Contract Owner's check has been or will be collected. We will not delay payment longer than necessary for us to verify that payment has been or will be collected. Contract Owners may avoid the possibility of delay in the disbursement of proceeds coming from a check that has not yet cleared by providing us with a certified check. If your Contract is issued as part of a 403(b) plan, there are restrictions on your ability to make withdrawals from your Contract. You may not withdraw contributions or earnings made to your Contract after December 31, 1988 unless you are (a) age 59 1/2, (b) no longer employed, (c) deceased, (d) disabled, or (e) experiencing a financial hardship. Even if you are experiencing a financial hardship, you may only withdraw contributions, not earnings. You should consult with your tax adviser before making a withdrawal from your Contract. SYSTEMATIC WITHDRAWALS Before the Maturity Date, you may choose to withdraw a specified dollar amount (at least $100) on a monthly, quarterly, semiannual or annual basis. We will deduct any applicable premium taxes and withdrawal charge. To elect systematic withdrawals, you must have a Contract Value of at least $15,000 and you must make the election on the form we provide. We will surrender Accumulation Units pro rata from all funding options in which you have an interest, unless you instruct us otherwise. You may begin or discontinue systematic withdrawals at any time by 23 notifying us in writing, but you must give at least 30 days' notice to change any systematic withdrawal instructions that are currently in place. We reserve the right to discontinue offering systematic withdrawals or to assess a processing fee for this service upon 30 days' written notice to Contract Owners (where allowed by state law). There is currently no additional fee for electing systematic withdrawals. Each systematic withdrawal is subject to federal income taxes on the taxable portion and may be subject to Contract charges. In addition, a 10% federal penalty tax may be assessed on systematic withdrawals if the Contract Owner is under age 59 1/2. You should consult with your tax adviser regarding the tax consequences of systematic withdrawals. MANAGED DISTRIBUTION PROGRAM. Under the systematic withdrawal option, you may choose to participate in the Managed Distribution Program. At no cost to you, you may instruct us to calculate and make minimum distributions that may be required by the IRS upon reaching age 70 1/2. (See "Federal Tax Considerations.") These payments will not be subject to the withdrawal charge and will be in lieu of the free withdrawal allowance. No Dollar Cost Averaging will be permitted if you are participating in the Managed Distribution Program. LOANS Loans may be available under your Contract. Loans may only be taken against funds allocated or transferred to the Fixed Account. If available, all loan provisions are described in your Contract or loan agreement. OWNERSHIP PROVISIONS -------------------------------------------------------------------------------- TYPES OF OWNERSHIP CONTRACT OWNER The Contract belongs to the Contract Owner named in the Contract (on the Contract Specifications page), or to any other person to whom you subsequently assign the Contract. You may only make an assignment of ownership or a collateral assignment for Non-qualified Contracts. You have sole power during the Annuitant's lifetime to exercise any rights and to receive all benefits given in the Contract provided you have not named an irrevocable beneficiary and provided you have not assigned the Contract. You receive all payments while the Annuitant is alive unless you direct them to an alternate recipient. An alternate recipient does not become the Contract Owner. Joint Owner. For Non-qualified Contracts only, you may name joint owners (e.g., spouses) in a Written Request before the Contract is in effect. Joint owners may independently exercise transfers allowed under the Contract. All other rights of ownership must be exercised by both owners. Joint owners own equal shares of any benefits accruing or payments made to them. Succeeding Owner. For Non-qualified Contracts only, if joint owners are not named, the Contract Owner may name a succeeding owner in a Written Request. The succeeding owner becomes the Contract Owner if living when the Contract Owner dies. The succeeding owner has no interest in the Contract before then. The Contract Owner may change or delete a succeeding owner by Written Request. BENEFICIARY You name the beneficiary in a Written Request. The beneficiary has the right to receive any death benefit proceeds remaining under the Contract upon the death of the Annuitant or the Contract Owner. If more than one beneficiary survives the Annuitant or Contract Owner, they will share equally in benefits unless you recorded different shares with the Company by Written Request before the death of the Annuitant or Contract Owner. In the case of a non-spousal beneficiary or a spousal beneficiary who has not chosen to assume the Contract, we will not transfer or otherwise remove the death benefit proceeds from either the Variable Funding Options or the Fixed Account, as most recently elected by the Contract Owner, until the Death Report Date. 24 Unless you have named an irrevocable beneficiary you have the right to change any beneficiary by Written Request during the lifetime of the Annuitant and while the Contract continues. ANNUITANT The Annuitant is designated in the Contract (on the Contract Specifications page), and is the individual on whose life the Maturity Date and the amount of the monthly Annuity Payments depend. You may not change the Annuitant after your Contract is in effect. Contingent Annuitant. You may name one individual as a Contingent Annuitant. A Contingent Annuitant may not be changed, deleted or added to the Contract after the Contract Date. If the Annuitant who is not the owner dies prior to the Maturity Date, and the Contingent Annuitant is still living: - the death benefit will not be payable upon the Annuitant's death - the Contingent Annuitant becomes the Annuitant - all other rights and benefits will continue in effect When a Contingent Annuitant becomes the Annuitant, the Maturity Date remains the same as previously in effect. If the Annuitant is also the owner, a death benefit is paid to the beneficiary regardless of whether or not there is a Contingent Annuitant. You may not change, delete, or add a Contingent Annuitant after the Contract becomes effective. DEATH BENEFIT -------------------------------------------------------------------------------- Before the Maturity Date, generally, a death benefit is payable when either the Annuitant or a Contract Owner dies. At purchase, you elect either the Standard Death Benefit, or the Enhanced Death Benefit (also referred to as the "Roll-Up Death Benefit"). The death benefit is calculated at the close of the business day on which the Company's Home Office receives Due Proof of Death and written payment instructions or election of beneficiary contract continuance ("Death Report Date"). Note: If the owner dies before the Annuitant, the death benefit is recalculated, replacing all references to "Annuitant" with "owner." DEATH PROCEEDS BEFORE THE MATURITY DATE STANDARD DEATH BENEFIT DEATH OF ANY OWNER OR THE ANNUITANT BEFORE AGE 75. We will pay to the beneficiary a death benefit in an amount equal to the greatest of (1), (2) or (3) below, each reduced by any applicable premium tax, withdrawals or outstanding loans not previously deducted: (1) the Contract Value; (2) the total Purchase Payments made under the Contract; or (3) the Contract Value on the latest fifth Contract Year anniversary immediately preceding the date on which the Company receives Due Proof of Death. DEATH OF ANY OWNER OR THE ANNUITANT ON OR AFTER AGE 75. We will pay to the beneficiary a death benefit in an amount equal to the greatest of (1), (2) or (3) below, each reduced by any applicable premium tax, withdrawals or outstanding loans not previously deducted: (1) the Contract Value; (2) the total Purchase Payments made under the Contract; or 25 (3) the Contract Value on the latest fifth Contract Year anniversary occurring on or before the Annuitant's 75(th) birthday. ENHANCED DEATH BENEFIT (ROLL-UP DEATH BENEFIT) (NOT AVAILABLE WHEN EITHER THE ANNUITANT OR OWNER IS AGE 76 OR OLDER ON THE CONTRACT DATE) (Please refer to Appendix E for a description of the Enhanced Death Benefit for contracts purchased prior to June 1, 1997.) All death benefits described below are reduced by any applicable premium tax, prior withdrawals or outstanding loans not previously deducted.
AGE AT TIME OF DEATH DEATH BENEFIT ------------------------------------------------------------------------------------- If the Annuitant dies before age 80, the death benefit will be the greatest of: - the Contract Value on the Death Report Date - the roll-up death benefit value on the Death Report Date (as described below) - the maximum of all step-up death benefit values (as described below) available on the Death Report Date ------------------------------------------------------------------------------------- If the Annuitant dies on or after age 80, the death benefit will be the greatest of: - the Contract Value on the Death Report Date - the roll-up death benefit value (as described below) on the Annuitant's 80(th) birthday, plus any additional Purchase Payments and minus any partial surrender reductions (as described below) that occur after the Annuitant's 80(th) birthday; or - The maximum of all step-up death benefit values (as described below) in effect on the Death Report Date which are associated with any Contract Date anniversary occurring on or before the Annuitant's 80(th) birthday -------------------------------------------------------------------------------------
THE ROLL-UP DEATH BENEFIT VALUE. On the Contract Date, the roll-up death benefit value is equal to the Purchase Payment. On each Contract Date anniversary, the roll-up death benefit value will be recalculated to equal (a) plus (b) minus (c), increased by 5%, where: (a) is the roll-up death benefit value as of the previous Contract Date anniversary (b) is any Purchase Payment during the previous Contract Year (c) is any partial surrender reduction (as described below) during the previous Contract Year On dates other than the Contract Date anniversary, the roll-up death benefit value equals (a) plus (b) minus (c) where: (a) is the roll-up death benefit value as of the previous Contract Date anniversary (b) is any Purchase Payment made since the previous Contract Date anniversary (c) is any partial surrender reduction (as described below) since the previous Contract Date anniversary. The maximum roll-up death benefit payable equals 200% of the difference between all Purchase Payments and all partial surrender reductions (as described below). STEP-UP VALUE. We will establish a separate death benefit value on each anniversary of the Contract Date which occurs on or prior to the Death Report Date. The step-up value will initially equal the Contract Value on that anniversary. Whenever you make a Purchase Payment, we will increase the step-up value by the amount of that Purchase Payment. Whenever you take a withdrawal, we will reduce the step-up value by a partial surrender reduction as described below. Recalculations of step-up death benefit values related to any Purchase Payments or any withdrawals will be made in the order that such Purchase Payments or withdrawals occur. 26 THE PARTIAL SURRENDER REDUCTION referenced above is equal to (1) the amount of a death benefit value (step-up or roll-up) immediately prior to the reduction for the withdrawal, multiplied by (2) the amount of the withdrawal divided by the Contract Value immediately prior to the withdrawal. For example, assume your current Contract Value is $55,000. If your original step-up value is $50,000, and you decide to make a withdrawal of $10,000, we would reduce the step-up value as follows: 50,000 x (10,000/55,000) = $9,090 Your new step-up value would be 50,000-9,090 or $40,910. The following example shows what would happen in a declining market. Assume your current Contract Value is $30,000. If your original step-up value is $50,000, and you decide to make a withdrawal of $10,000, we would reduce the step-up value as follows: 50,000 x (10,000/30,000) = $16,666 Your new step-up value would be 50,000-16,666, or $33,334. PAYMENT OF PROCEEDS We describe the process of paying death benefit proceeds before the Maturity Date in the charts below. The charts do not encompass every situation and are merely intended as a general guide. More detailed information is provided in your Contract. Generally, the person(s) receiving the benefit may request that the proceeds be paid in a lump sum, or be applied to one of the settlement options available under the Contract. NON-QUALIFIED CONTRACTS
-------------------------------------------------------------------------------------------------------------- MANDATORY BEFORE THE MATURITY DATE, THE COMPANY WILL PAYOUT RULES UPON THE DEATH OF THE PAY THE PROCEEDS TO: UNLESS... APPLY* -------------------------------------------------------------------------------------------------------------- OWNER (WHO IS NOT THE The beneficiary (ies), or if The beneficiary elects to Yes ANNUITANT) (WITH NO JOINT none, to the Contract continue the Contract rather OWNER) Owner's estate. than receive the lump sum distribution. -------------------------------------------------------------------------------------------------------------- OWNER (WHO IS THE ANNUITANT) The beneficiary (ies), or if The beneficiary elects to Yes (WITH NO JOINT OWNER) none, to the Contract continue the Contract rather Owner's estate. than receive the lump sum distribution. -------------------------------------------------------------------------------------------------------------- JOINT OWNER (WHO IS NOT THE The surviving joint owner. The surviving joint owner Yes ANNUITANT) elects to continue the Contract rather than receive the lump sum distribution. -------------------------------------------------------------------------------------------------------------- JOINT OWNER (WHO IS THE The beneficiary (ies), or if The beneficiary/surviving Yes ANNUITANT) none, to the surviving joint joint owner elects to owner. continue the Contract rather than receive a lump sum distribution. -------------------------------------------------------------------------------------------------------------- ANNUITANT (WHO IS THE See death of "owner who is Yes CONTRACT OWNER) the Annuitant" above. --------------------------------------------------------------------------------------------------------------
27
-------------------------------------------------------------------------------------------------------------- MANDATORY BEFORE THE MATURITY DATE, THE COMPANY WILL PAYOUT RULES UPON THE DEATH OF THE PAY THE PROCEEDS TO: UNLESS... APPLY* -------------------------------------------------------------------------------------------------------------- ANNUITANT (WHERE OWNER IS A NONNATURAL PERSON/TRUST) The beneficiary (ies) (e.g. Yes (Death of Annuitant is the trust) or if none, to treated as death of the the owner. owner in these circumstances.) -------------------------------------------------------------------------------------------------------------- CONTINGENT ANNUITANT No death proceeds are N/A (ASSUMING ANNUITANT IS STILL payable; contract continues. ALIVE) -------------------------------------------------------------------------------------------------------------- BENEFICIARY No death proceeds are N/A payable; contract continues. -------------------------------------------------------------------------------------------------------------- CONTINGENT BENEFICIARY No death proceeds are N/A payable; contract continues. --------------------------------------------------------------------------------------------------------------
--------- * Certain payout rules of the Code are triggered upon the death of any Owner. Non-spousal beneficiaries (as well as spousal beneficiaries who choose not to assume the Contract) must begin taking distributions based on the beneficiary's life expectancy within one year of death or take a complete distribution of Contract proceeds within 5 years of death. If mandatory distributions have begun, the 5-year payout option is not available. QUALIFIED CONTRACTS
-------------------------------------------------------------------------------------------------------------- MANDATORY BEFORE THE MATURITY DATE, THE COMPANY WILL PAYOUT RULES UPON THE DEATH OF THE PAY THE PROCEEDS TO: UNLESS... APPLY* -------------------------------------------------------------------------------------------------------------- OWNER/ANNUITANT The beneficiary (ies), or if The beneficiary elects to Yes none, to the Contract continue the Contract rather Owner's estate. than receive a lump sum distribution. -------------------------------------------------------------------------------------------------------------- BENEFICIARY No death proceeds are N/A payable; Contract continues. -------------------------------------------------------------------------------------------------------------- CONTINGENT BENEFICIARY No death proceeds are N/A payable; Contract continues. --------------------------------------------------------------------------------------------------------------
BENEFICIARY CONTRACT CONTINUANCE (NOT PERMITTED FOR NON-NATURAL BENEFICIARIES) If you die before the Maturity Date, and if the value of any beneficiary's portion of the death benefit is between $20,000 and $1,000,000 as of the Death Report Date, (more than $1,000,000 is subject to Home Office approval), your beneficiary(ies) may elect to continue his/her portion of the Contract subject to applicable Internal Revenue Code distribution requirements, rather than receive the death benefit in a lump sum. If the beneficiary chooses to continue the Contract, the beneficiary can extend the payout phase of the Contract enabling the beneficiary to "stretch" the death benefit distributions out over his life expectancy as permitted by the Internal Revenue Code. If your beneficiary elects to continue the Contract, the death benefit will be calculated as of the Death Report Date. The initial Contract Value of the continued Contract (the "adjusted Contract Value") will equal the greater of the Contract Value or the death benefit calculated on the Death Report Date and will be allocated to the funding options in the same proportion as prior to the Death Report Date. If the adjusted Contract Value is allocated to the Variable Funding Options, the beneficiary bears the investment risk. The beneficiary who continues the Contract will be granted the same rights as the owner under the original Contract, except the beneficiary cannot: - transfer ownership 28 - take a loan - make additional Purchase Payments The beneficiary may also name his/her own beneficiary ("succeeding beneficiary") and has the right to take withdrawals at any time after the Death Report Date without a withdrawal charge. All other fees and charges applicable to the original Contract will also apply to the continued Contract. All benefits and features of the continued Contract will be based on the beneficiary's age on the Death Report Date as if the beneficiary had purchased the Contract with the adjusted Contract Value on the Death Report Date. PLANNED DEATH BENEFIT You may request that rather than receive a lump-sum death benefit, the beneficiary(ies) receive all or a portion of the death benefit proceeds either: - as a variable or fixed annuity for life or a period that does not exceed the beneficiary's life expectancy, or - under the terms of the Beneficiary Continuance provision described above. If the Beneficiary Continuance provision is selected as a planned death benefit, no surrenders will be allowed other than payments meant to satisfy minimum distribution amounts or systematic withdrawal amounts, if greater. You must make the planned death benefit request as well as any revocation of this request in writing. Upon your death, your beneficiary(ies) cannot revoke or modify this request. If the death benefit at the time we receive Due Proof of Death is less than $2,000, we will only pay a lump sum to the beneficiary. If periodic payments due under the planned death benefit election are less than $100, we reserve the right to make Annuity Payments at less frequent intervals, resulting in a payment of at least $100 per year. If no beneficiary is alive when death benefits become payable, we will pay the death benefit as provided in your Contract. DEATH PROCEEDS AFTER THE MATURITY DATE If any Contract Owner or the Annuitant dies on or after the Maturity Date, the Company will pay the beneficiary a death benefit consisting of any benefit remaining under the annuity option then in effect. THE ANNUITY PERIOD -------------------------------------------------------------------------------- MATURITY DATE Under the Contract, you can receive regular payments ("Annuity Payments"). You can choose the month and the year in which those payments begin ("Maturity Date"). You can also choose among payout options or elect a lump sum distribution. While the Annuitant is alive, you can change your selection any time up to the Maturity Date. Annuity Payments will begin on the Maturity Date stated in the Contract unless (1) you fully surrendered the Contract; (2) we paid the proceeds to the beneficiary before that date; or (3) you elected another date. Annuity Payments are a series of periodic payments (a) for life; (b) for life with a minimum number of payments assured; (c) for the joint lifetime of the Annuitant and another person, and thereafter during the lifetime of the survivor; or (d) for a fixed period. We may require proof that the Annuitant is alive before we make Annuity Payments. Not all options may be available in all states. Please be aware that once the Contract is annuitized, you are ineligible to receive the death benefit you have selected. You may choose to annuitize at any time after you purchase your Contract. Unless you elect otherwise, the Maturity Date will be the Annuitant's 75th birthday for Non-qualified Contracts or ten years after the effective date of the Contract, if later and the Annuitant's 70th birthday for Qualified Contracts (this requirement may be changed by us). (For Contracts issued in Florida and New York, the Maturity Date you elect may not be later than the Annuitant's 90(th) birthday.) At least 30 days before the original Maturity Date, you may elect to extend the Maturity Date to any time prior to the Annuitant's 90th birthday for Non- qualified Contracts, or 70(th) birthday for Qualified Contracts, or for all Contracts, to a later date with our consent. You may use certain annuity options taken at the Maturity Date to meet the minimum 29 required distribution requirements of federal tax law, or you may use a program of withdrawals instead. These mandatory distribution requirements take effect generally upon the death of the Contract Owner, or with certain Qualified Contracts upon either the later of the Contract Owner's attainment of age 70 1/2 or year of retirement; or the death of the Contract Owner. You should seek independent tax advice regarding the election of minimum required distributions. ALLOCATION OF ANNUITY You may elect to receive your Annuity Payments in the form of a variable annuity, a fixed annuity, or a combination of both. If, at the time Annuity Payments begin, you have not made an election, we will apply your Cash Surrender Value to provide an annuity funded by the same funding options as you have selected during the accumulation period. At least 30 days before the Maturity Date, you may transfer the Contract Value among the funding options in order to change the basis on which we will determine Annuity Payments. (See "Transfers.") VARIABLE ANNUITY You may choose an annuity payout that fluctuates depending on the investment experience of the Variable Funding Options. We determine the number of Annuity Units credited to the Contract by dividing the first monthly Annuity Payment attributable to each Variable Funding Option by the corresponding Accumulation Unit value as of 14 days before the date Annuity Payments begin. We use an Annuity Unit to measure the dollar value of an Annuity Payment. The number of Annuity Units (but not their value) remains fixed during the annuity period. DETERMINATION OF FIRST ANNUITY PAYMENT. Your Contract contains the tables we use to determine your first monthly Annuity Payment. If you elect a variable annuity, the amount we apply to it will be the Cash Surrender Value as of 14 days before the date Annuity Payments begin, less any applicable premium taxes not previously deducted. The amount of your first monthly payment depends on the annuity option you elected and the Annuitant's adjusted age. Your Contract contains the formula for determining the adjusted age. We determine the total first monthly Annuity Payment by multiplying the benefit per $1,000 of value shown in the Contract tables by the number of thousands of dollars of Contract Value you apply to that annuity option. The Contract tables factor in an assumed daily net investment factor of 3.0%. We call this your net investment rate. Your net investment rate of 3% corresponds to an annual interest rate of 3%. This means that if the annualized investment performance, after expenses, of your Variable Funding Options is less than 3%, then the dollar amount of your variable Annuity Payments will decrease. However, if the annualized investment performance, after expenses, of your Variable Funding Options is greater than 3%, then the dollar amount of your variable Annuity Payments will increase. DETERMINATION OF SECOND AND SUBSEQUENT ANNUITY PAYMENTS. The dollar amount of all subsequent Annuity Payments changes from month to month based on the investment experience, as described above, of the applicable funding options. The total amount of each Annuity Payment will equal the sum of the basic payments in each funding option. We determine the actual amounts of these payments by multiplying the number of Annuity Units we credited to each funding option by the corresponding Annuity Unit value as of the date 14 days before the date the payment is due. FIXED ANNUITY You may choose a fixed annuity that provides payments that do not vary during the annuity period. We will calculate the dollar amount of the first fixed Annuity Payment as described under "Variable Annuity," except that the amount we apply to begin the annuity will be your Cash Surrender Value as of the date Annuity Payments begin. Payout rates will not be lower than that shown in the Contract. If it would produce a larger payment, the first fixed Annuity Payment will be determined using the Annuity Tables in effect on the Maturity Date. 30 PAYMENT OPTIONS -------------------------------------------------------------------------------- ELECTION OF OPTIONS While the Annuitant is alive, you can change your annuity option selection any time up to the Maturity Date. Once Annuity Payments have begun, no further elections are allowed. During the Annuitant's lifetime, if you do not elect otherwise before the Maturity Date, we will pay you (or another designated payee) the first of a series of monthly Annuity Payments based on the life of the Annuitant, in accordance with Annuity Option 2 (Life Annuity with 120 monthly payments assured). For certain Qualified Contracts, Annuity Option 4 (Joint and Last Survivor Life Annuity -- Annuity Reduced on Death of Primary Payee) will be the automatic option as described in the Contract. (See "Annuity Options.") The minimum amount that can be placed under an annuity option will be $1,000 unless we agree to a lesser amount. If any monthly periodic payment due is less than $100, the Company reserves the right to make payments at less frequent intervals, or to pay the Contract Value in a lump-sum. On the Maturity Date, we will pay the amount due under the Contract in accordance with the payment option that you select. You may choose to receive a single lump-sum payment. You must elect an option in writing, in a form satisfactory to the Company. Any election made during the lifetime of the Annuitant must be made by the Contract Owner. ANNUITY OPTIONS Subject to the conditions described in "Election of Options" above, we may pay all or any part of the Cash Surrender Value under one or more of the following annuity options. Payments under the annuity options are generally made on a monthly basis. We may offer additional options. Option 1 -- Life Annuity -- No Refund. The Company will make Annuity Payments during the lifetime of the Annuitant ending with the last payment before death. This option offers the maximum periodic payment, since there is no assurance of a minimum number of payments or provision for a death benefit for beneficiaries. Option 2 -- Life Annuity with 120, 180 or 240 Monthly Payments Assured. The Company will make monthly Annuity Payments during the lifetime of the Annuitant, with the agreement that if, at the death of that person, payments have been made for less than 120, 180 or 240 months, as elected, we will continue making payments to the beneficiary during the remainder of the period. Option 3 -- Joint and Last Survivor Life Annuity -- No Refund. The Company will make regular Annuity Payments during the lifetime of the Annuitant and a second person. When either person dies, we will continue making payments to the survivor. No further payments will be made following the death of the survivor. Option 4 -- Joint and Last Survivor Life Annuity -- Annuity Reduced on Death of Primary Payee. The Company will make Annuity Payments during the lifetimes of the Annuitant and a second person. You will designate one as primary payee, and the other will be designated as secondary payee. On the death of the secondary payee, the Company will continue to make monthly Annuity Payments to the primary payee in the same amount that would have been payable during the joint lifetime of the two persons. On the death of the primary payee, the Company will continue to make Annuity Payments to the secondary payee in an amount equal to 50% of the payments, which would have been made during the lifetime of the primary payee. No further payments will be made once both payees have died. Option 5 -- Payments for a Fixed Period without Life Contingency. We will make periodic payments for the period selected. This option may not satisfy the minimum required distribution rules for Qualified Contracts. Consult a tax adviser before electing this option. Option 6 -- Other Annuity Options. We will make any other arrangements for Annuity Payments as may be mutually agreed upon. 31 VARIABLE LIQUIDITY BENEFIT This benefit is only offered with the annuity option "Payments for a Fixed Period without Life Contingency." At any time after annuitization and before death, the Contract Owner may surrender and receive a payment equal to (A) minus (B), where (A) equals the present value of remaining certain payments, and (B) equals a withdrawal charge not to exceed the maximum withdrawal charge rate shown on the specifications page of the Contract multiplied by (A). The interest rate used to calculate the present value is a rate 1% higher than the Assumed (Daily) Net Investment Factor used to calculate the Annuity Payments. The remaining period certain payments are assumed to be level payments equal to the most recent period certain payment prior to the request for this liquidity benefit. A withdrawal charge is not imposed if the surrender is made after the expiration of the withdrawal charge period shown on the specifications page of the Contract. MISCELLANEOUS CONTRACT PROVISIONS -------------------------------------------------------------------------------- RIGHT TO RETURN You may return the Contract for a full refund of the Contract Value plus any Contract charges and premium taxes you paid (but not any fees and charges the Underlying Fund assessed) within twenty days after you receive it (the "right to return period"). You bear the investment risk of investing in the Variable Funding Options during the right to return period; therefore, the Contract Value we return may be greater or less than your Purchase Payment. If you purchase the Contract as an Individual Retirement Annuity, and return it within the first seven days after delivery, or longer if your state law permits, we will refund your Purchase Payment in full; during the remainder of the right to return period, we will refund the Contract Value (including charges). We will determine the Contract Value following the close of the business day on which we receive your Contract and a Written Request for a refund. Where state law requires a different period, or the return of Purchase Payments or other variations of this provision, we will comply. Refer to your Contract for any state-specific information. TERMINATION We reserve the right to terminate the Contract on any business day if your Contract Value as of that date is less than $2,000 and you have not made Purchase Payments for at least two years, unless otherwise specified by state law. Accordingly, no Contract will be terminated due solely to negative investment performance. Termination will not occur until 31 days after we have mailed notice of termination to your last known address and to any assignee of record. If we terminate the Contract, we will pay you the Cash Surrender Value less any applicable taxes. In certain states, we may be required to pay you the Contract Value. Federal tax law may impose additional restrictions on our right to terminate your traditional IRA, Roth IRA or other Qualified Contract. REQUIRED REPORTS As often as required by law, but at least once in each Contract Year before the due date of the first Annuity Payment, we will furnish a report showing the number of Accumulation Units credited to the Contract and the corresponding Accumulation Unit value(s) as of the report date for each funding option to which the Contract Owner has allocated amounts during the applicable period. The Company will keep all records required under federal and state laws. SUSPENSION OF PAYMENTS The Company reserves the right to suspend or postpone the date of any payment or determination of values on any business day (1) when the New York Stock Exchange ("the Exchange") is closed; (2) when trading on the Exchange is restricted; (3) when an emergency exists, as determined by the SEC, so that the sale of securities held in the Separate Account may not reasonably occur, or so that the Company may not reasonably determine the value the Separate Account's net assets; or (4) during any other period when the SEC, by order, so permits for the protection of security holders. At any time, payments from the Fixed Account may be delayed up to 6 months. 32 THE SEPARATE ACCOUNTS -------------------------------------------------------------------------------- The Company sponsors Fund BD and Fund BD II. When we refer to the Separate Account, we are referring to Fund BD, except where the Contract was originally issued by MLACC, in which case, we are referring to Fund BD II. (See "The Insurance Company" .) Both Fund BD and Fund BD II were established on October 22, 1993 and are registered with the SEC as unit investment trusts under the Investment Company Act of 1940, as amended. We will invest Separate Account assets attributable to the Contracts exclusively in the shares of the Variable Funding Options. We anticipate merging Fund BD and Fund BD II with and into another separate account of the Company (the MetLife of CT Separate Account Eleven for Variable Annuities) during the fourth quarter of 2008 at the earliest, subject to regulatory approval. This merger will have no effect on the provisions of, and the rights and obligations under, the Contract. Similarly, the merger will not have any adverse impact on your Contract Value or any tax consequences for you. We hold the assets of the Separate Account for the exclusive and separate benefit of the owners of each Separate Account, according to the laws of Connecticut. Income, gains and losses, whether or not realized, from assets allocated to the Separate Account are, in accordance with the Contracts, credited to or charged against the Separate Account without regard to other income, gains and losses of the Company. The assets held by the Separate Account are not chargeable with liabilities arising out of any other business that we may conduct. Obligations under the Contract are obligations of the Company. Any obligations that exceed the assets in the Separate Account are payable by the Company's general account. The amount of the guaranteed death benefit that exceeds the Contract Value is paid from the Company's general account. Benefit amounts paid from the general account are subject to the financial strength and claims-paying ability of the Company. All investment income and other distributions of the funding options are payable to the Separate Account. We reinvest all such income and/or distributions in shares of the respective funding option at net asset value. Shares of the funding options are currently sold only to life insurance company separate accounts to fund variable annuity and variable life insurance contracts. Certain variable annuity separate accounts and variable life insurance separate accounts may invest in the funding options simultaneously (called "mixed" and "shared" funding). It is conceivable that in the future it may be disadvantageous to do so. Although the Company and the Variable Funding Options do not currently foresee any such disadvantages either to variable annuity contract owners or variable life policy owners, each Underlying Fund's Board of Directors intends to monitor events in order to identify any material conflicts between them and to determine what action, if any, should be taken. If a Board of Directors was to conclude that separate funds should be established for variable life and variable annuity separate accounts, the variable annuity contract owners would not bear any of the related expenses, but variable annuity contract owners and variable life insurance policy owners would no longer have the economies of scale resulting from a larger combined fund. We reserve the right to transfer assets of the Separate Account to another separate account, and/or to modify the structure or operation of the Separate Account, subject to the necessary regulatory approvals. If we do so, we guarantee that the modification will not affect your Contract Value. PERFORMANCE INFORMATION In advertisements for the Contract, we may include performance figures to show you how a Variable Funding Option has performed in the past. These figures are rates of return or yield quotations shown as a percent. These figures show past performance of a Variable Funding Option and are not an indication of how a Variable Funding Option will perform in the future. Performance figures for each Variable Funding Option are based in part on the performance of a corresponding Underlying Fund. In some cases, the Underlying Fund may have existed before the technical inception of the corresponding Variable Funding Option. In those cases, we can create "hypothetical historical performance" of a Variable Funding Option. These figures show the performance that the Variable Funding Option would have achieved had it been available during the entire history of the Underlying Fund. In a low interest rate environment, yields for money market Subaccounts, after deduction of the Mortality and Expense Risk Charge, Administrative Expense Charge and the charge for any optional benefit riders (if applicable), 33 may be negative even though the Underlying Fund's yield, before deducting for such charges, is positive. If you allocate a portion of your Contract Value to a money market Subaccount or participate in an asset allocation program where Contract Value is allocated to a money market Subaccount under the applicable asset allocation model, that portion of your Contract Value may decrease in value. FEDERAL TAX CONSIDERATIONS -------------------------------------------------------------------------------- The following general discussion of the federal income tax consequences related to your investment in this Contract is not intended to cover all situations, and is not meant to provide tax or legal advice. Because of the complexity of the law and the fact that the tax results will vary depending on many factors, you should consult your tax and/or legal adviser regarding the tax implications of purchasing this Contract based upon your individual situation. For further tax information, an additional discussion of certain tax matters is contained in the SAI. You are responsible for determining whether your purchase of a Contract, withdrawals, income payments and any other transaction under your Contract satisfy applicable tax law. We are not responsible for determining if your employer's plan or arrangement satisfies the requirements of the Code and/or the Employee Retirement Income Security Act of 1974 (ERISA). GENERAL TAXATION OF ANNUITIES Congress has recognized the value of saving for retirement by providing certain tax benefits, in the form of tax deferral, for premiums paid under an annuity and permitting tax-free transfers between the various investment options offered under the Contract. The Internal Revenue Code ("Code") governs how earnings on your investment in the Contract are ultimately taxed, depending upon the type of contract, qualified or non-qualified, and the manner in which the money is distributed, as briefly described below. In analyzing the benefits of tax deferral it is important to note that the Jobs and Growth Tax Relief Reconciliation Act of 2003 amended Code Section 1 to reduce the marginal tax rates on long-term capital gains and dividends to 5% and 15%. The reduced rates apply during 2003 through 2008, and thereafter will increase to prior levels. Under current federal tax law, the taxable portion of distributions under variable annuity contracts and qualified plans (including IRAs) is not eligible for the reduced tax rate applicable to long-term capital gains and dividends. Earnings under annuity contracts, like interest payable on fixed investments (notes, bonds, etc.), continue to be taxed as ordinary income (top rate of 35%). The tax law provides deferred annuities issued after October 21, 1988 by the same insurance company or an affiliate in the same calendar year to the same owner are combined for tax purposes. As a result, a greater portion of your withdrawals may be considered taxable income than you would otherwise expect. Although the law is not clear, the aggregation rule may also adversely affect the tax treatment of payments received under an income annuity where the owner has purchased more than one non-qualified annuity during the same calendar year from the same or an affiliated company after October 21, 1988, and is not receiving income payments from all annuities at the same time. Please consult your own tax advisor. STATE AND LOCAL TAXES. The rules for state and local income taxes may differ from the federal income tax rules. Purchasers and prospective purchasers of the Contract should consult their own tax advisers and the law of the applicable taxing jurisdiction to determine what rules and tax benefits apply to the Contract. PENALTY TAX FOR PREMATURE DISTRIBUTIONS. For both Qualified and Non-qualified Contracts, taxable distributions taken before the Contract Owner has reached the age of 59 1/2 will be subject to a 10% additional tax penalty unless the distribution is taken in a series of periodic distributions, for life or life expectancy, or unless the distribution follows the death or disability of the Contract Owner. Other exceptions may be available in certain qualified plans. The 10% tax penalty is in addition to any other penalties that may apply under your Contract and the normal income taxes due on the distribution. TAX-FREE EXCHANGES. Code Section 1035 provides that, if certain conditions are met, no gain or loss is recognized when an annuity contract is received in exchange for a life insurance policy, endowment, or annuity contract. Since different annuity contracts have different expenses, fees and benefits, a tax- free exchange could result in your investment becoming subject to higher or lower fees and/or expenses. FEDERAL ESTATE TAXES. While no attempt is being made to discuss the federal estate tax implications of the Contract, you should keep in mind that the value of an annuity contract owned by a decedent and payable to a beneficiary by 34 virtue of surviving the decedent is included in the decedent's gross estate. Depending on the terms of the annuity contract, the value of the annuity included in the gross estate may be the value of the lump sum payment payable to the designated beneficiary or the actuarial value of the payments to be received by the beneficiary. Consult an estate planning adviser for more information. GENERATION-SKIPPING TRANSFER TAX. Under certain circumstances, the Code may impose a "generation-skipping transfer tax" when all or part of an annuity contract is transferred to, or a death benefit is paid to, an individual two or more generations younger than the Contract Owner. Regulations issued under the Code may require us to deduct the tax from your Contract, or from any applicable payment, and pay it directly to the IRS. TYPES OF CONTRACTS: QUALIFIED AND NON-QUALIFIED QUALIFIED ANNUITY CONTRACTS If you purchase your Contract with proceeds of an eligible rollover distribution from any qualified employee pension plan or retirement savings plan or individual retirement annuity (IRA), your Contract is referred to as a Qualified Contract. Some examples of Qualified Contracts are: IRAs (including Roth IRAs), tax-sheltered annuities established by public school systems or certain tax- exempt organizations under Code Section 403(b), corporate sponsored pension, retirement savings, and profit-sharing plans (including 401(k) plans), Keogh Plans (for self-employed individuals), and certain other qualified deferred compensation plans. Another type of Qualified Contract is a Roth IRA, under which after-tax contributions accumulate until maturity, when amounts (including earnings) may be withdrawn tax-free. The rights and benefits under a Qualified Contract may be limited by the terms of the retirement plan, regardless of the terms and conditions of the Contract. Plan participants making contributions to Qualified Contracts will be subject to the required minimum distribution rules as provided by the Code and described below. All qualified plans (including IRAs) receive tax-deferral under the Code. Although there are no additional tax benefits to funding your qualified plan or IRA with an annuity, it does offer you additional insurance benefits, such as the availability of a guaranteed income for life. The Contract has not been submitted to the IRS for approval as to form as a valid IRA. Such approval would not constitute an IRS approval or endorsement of any funding options under the contract. IRS approval as to form is not required to constitute a valid IRA. Disqualification of the Contract as an IRA could result in the immediate taxation of amounts held in the Contract and other adverse tax consequences. TAXATION OF QUALIFIED ANNUITY CONTRACTS Under a qualified annuity, since amounts paid into the Contract generally have not yet been taxed, the full amount of any distributions (including the amount attributable to Purchase Payments), whether paid in the form of lump sum withdrawals or Annuity Payments, are generally taxed at ordinary income tax rates unless the distribution is transferred to an eligible rollover account or contract. There are special rules which govern the taxation of Qualified Contracts, including withdrawal restrictions, requirements for mandatory distributions, and contribution limits. Amounts rolled over to the Contract from other qualified funding vehicles generally are not subject to current taxation. MANDATORY DISTRIBUTIONS FOR QUALIFIED PLANS Federal tax law requires that minimum annual distributions begin by April 1st of the calendar year following the calendar year in which an IRA owner attains age 70 1/2. Participants in qualified plans and 403(b) annuities may defer minimum distributions until the later of April 1st of the calendar year following the calendar year in which they attain age 70 1/2 or the year of retirement (except for participants who are 5% or more owners of the plan sponsor). If you own more than one individual retirement annuity and/or account, you may satisfy the minimum distribution rules on an aggregate basis (i.e. determine the total amount of required distributions from all IRAs and take the required amount from any one or more IRAs). A similar aggregate approach is available to meet your 403(b) minimum distribution requirements if you have multiple 403(b) annuities. Recently promulgated Treasury regulations changed the distribution requirements; therefore, it is important that you consult your tax adviser as to the impact of these regulations on your personal situation. 35 Final income tax regulations regarding minimum distribution requirements were released in June 2004. These regulations affect both deferred and income annuities. Under these new rules, effective with respect to minimum distributions required for the 2006 distribution year, in general, the value of all benefits under a deferred annuity (including death benefits in excess of cash value, including the Enhanced Stepped-Up Provision, as well as all living benefits such as GMAB and GMWB , if available in your contract) must be added to the Contract Value in computing the amount required to be distributed over the applicable period. We will provide you with additional information as to the amount of your interest in the Contract that is subject to required minimum distributions under this new rule and either compute the required amount for you or offer to do so at your request. The new rules are not entirely clear and you should consult your personal tax advisor as to how these rules affect your Contract. MINIMUM DISTRIBUTIONS FOR BENEFICIARIES UPON THE CONTRACT OWNER'S DEATH: Upon the death of the Contract Owner and/or Annuitant of a Qualified Contract, the funds remaining in the Contract must be completely withdrawn within five years from the date of death or minimum distributions may be taken over the life expectancy of the individual beneficiaries (or in the case of certain trusts that are contract beneficiaries, over the life expectancy of the individuals who are the beneficiaries of the trust), provided such distributions are payable at least annually and begin within one year from the date of death. Special rules apply where the beneficiary is the surviving spouse, which allow the spouse to assume the Contract and defer the minimum distribution requirements. NOTE TO PARTICIPANTS IN QUALIFIED PLANS INCLUDING 401, 403(B), 408 OR 457, INCLUDING IRA OWNERS: While annual plan contribution limits may be increased from time to time by Congress and the IRS for federal income tax purposes, these limits must be adopted by each state for any higher limits to be effective at a state income tax level. In other words, the permissible contribution limits for federal and state income tax purposes may be different. Therefore, in certain states, a portion of the contributions may not be excludible or deductible from state income taxes. Please consult your employer or tax adviser regarding this issue. INDIVIDUAL RETIREMENT ANNUITIES To the extent of earned income for the year and not exceeding the applicable limit for the taxable year, an individual may make contributions, which in some cases may be deductible, to an individual retirement annuity (IRA). The applicable limit is $4,000 in 2007 and $5,000 in 2008, and it may be indexed for inflation in years after 2008. Additional "catch-up contributions" may be made to an IRA by individuals age 50 or over. There are certain limits on the deductible amount based on the adjusted gross income of the individual and spouse and on their participation in a retirement plan. If an individual is married and the spouse is not employed, the individual may establish IRAs for the individual and spouse. Purchase Payments may then be made annually into IRAs for both spouses in the maximum amount of 100% of earned income up to a combined limit based on the individual limits outlined above. Deductible contributions to an IRA and Roth IRA for the year must be aggregated for purposes of the individual Code Section 408A limits and the Code Section 219 limits (age 50+catch-up). Partial or full distributions are treated as ordinary income, except that amounts contributed after 1986 on a non-deductible basis are not includable in income when distributed. An additional tax of 10% will apply to any taxable distribution from the IRA that is received by the participant before the age of 59 1/2 except by reason of death, disability or as part of a series of payments for life or life expectancy. Distributions must commence by April 1st of the calendar year after the close of the calendar year in which the individual attains the age of 70 1/2. Certain other mandatory distribution rules apply on the death of the individual. The individual must maintain personal and tax return records of any non-deductible contributions and distributions. Section 408 (k) of the Code provides for the purchase of a Simplified Employee Pension (SEP) plan. A SEP is funded through an IRA and can accept an annual employer contribution limited to the lesser of $46,000 or 100% of pay for each participant in 2008. ROTH IRAS Effective January 1, 1998, Section 408A of the Code permits certain individuals to contribute to a Roth IRA. Eligibility to make contributions is based upon income, and the applicable limits vary based on marital status and/or whether the contribution is a rollover contribution from another IRA or an annual contribution. Contributions to a Roth IRA, which are subject to certain limitations, (similar to the annual limits for traditional IRAs), are not 36 deductible and must be made in cash or as a rollover or transfer from another Roth IRA or other IRA. A conversion of "traditional" IRA to a Roth IRA may be subject to tax and other special rules apply. You should consult a tax adviser before combining any converted amounts with other Roth IRA contributions, including any other conversion amounts from other tax years. Qualified distributions from a Roth IRA are tax-free. A qualified distribution requires that the Roth IRA has been held for at least 5 years, and the distribution is made after age 59 1/2, on death or disability of the owner, or for a limited amount ($10,000) for a qualified first time home purchase for the owner or certain relatives. Income tax and a 10% penalty tax may apply to distributions made (1) before age 59 1/2 (subject to certain exceptions) or (2) during five taxable years starting with the year in which the first contribution is made to the Roth IRA. TSAS (ERISA AND NON-ERISA) GENERAL. TSAs fall under sec.403(b) of the Code, which provides certain tax benefits to eligible employees of public school systems and organizations that are tax exempt under sec.501(c)(3) of the Code. In general contributions to sec.403(b) arrangements are subject to limitations under sec.415(c) of the Code (the lesser of 100% of includable compensation or the applicable limit for the year). Recently, the IRS announced new regulations affecting sec.403(b) plans and arrangements. As part of these regulations, employers will need to meet certain requirements in order for their employees' annuity contracts that fund these programs to retain a tax deferred status under sec.403(b). These regulations are generally effective January 1, 2009. Prior to the new rules, transfers of one annuity contract to another would not result in a loss of tax deferred status under sec.403(b) under certain conditions (so-called "90-24 transfers"). The new regulations have the following effect regarding transfers: (1) a newly issued contract funded by a transfer which is completed after September 24, 2007, is subject to the employer requirements referred to above; (2) additional purchase payments made after September 24, 2007, to a contract that was funded by a 90-24 transfer on or before September 24, 2007, may subject the contract to this new employer requirement. If your Contract was issued previously in a 90-24 transfer completed on or before September 24, 2007, we urge you to consult with your tax advisor prior to making additional purchase payments (if permitted). WITHDRAWALS AND INCOME PAYMENTS. If you are under 59 1/2, you cannot withdraw money from your TSA Contract unless the withdrawal: - Relates to Purchase Payments made prior to 1989 (and pre-1989 earnings on those Purchase Payments); - Is directly transferred to another permissible investment under sec.403(b) arrangements; - Relates to amounts that are not salary reduction elective deferrals; - Occurs after you die, leave your job or become disabled (as defined by the Code); or - Is for financial hardship (but only to the extent of Purchase Payments) if your plan allows it. DESIGNATED ROTH ACCOUNT FOR 403(B) PLANS. Effective January 1, 2006, employers that established and maintain a TSA/403(b) plan ("the Plan") may also establish a Qualified Roth Contribution Program under Section 402A of the Code ("Designated Roth Accounts") to accept after-tax contributions as part of the TSA plan. In accordance with our administrative procedures, we may permit these contributions to be made as purchase payments to a Section 403(b) Contract under the following conditions: (1) The employer maintaining the plan has demonstrated to our satisfaction that Designated Roth Accounts are permitted under the Plan. (2) In accordance with our administrative procedures, the amount of elective deferrals has been irrevocably designated as an after-tax contribution to the Designated Roth Account. (3) All state regulatory approvals have been obtained to permit the Contract to accept such after-tax elective deferral contributions (and, where permitted under the Qualified Roth Contribution Program and the Contract, rollovers and trustee-to-trustee transfers from other Designated Roth Accounts). 37 (4) In accordance with our procedures and in a form satisfactory to us, we may accept rollovers from other funding vehicles under any Qualified Roth Contribution Program of the same type in which the employee participates as well as trustee-to-trustee transfers from other funding vehicles under the same Qualified Roth Contribution Program for which the participant is making elective deferral contributions to the Contract. (5) No other contribution types (including employer contributions, matching contributions, etc.) will be allowed as designated Roth contributions, unless they become permitted under the Code. (6) If permitted under the federal tax law, we may permit both pre-tax contributions under a 403(b) plan as well as after-tax contributions under the Plan's Qualified Roth Contribution Program to be made under the same Contract as well as rollover contributions and contributions by trustee-to-trustee transfers. In such cases, we will account separately for the designated Roth contributions and the earnings thereon from the contributions and earnings made under the pre-tax TSA plan (whether made as elective deferrals, rollover contributions or trustee-to-trustee transfers). As between the pre-tax or traditional Plan and the Qualified Roth Contribution Program, we will allocate any living benefits or death benefits provided under the Contract on a reasonable basis, as permitted under the tax law. (7) We may refuse to accept contributions made as rollovers and trustee- to-trustee transfers, unless we are furnished with a breakdown as between participant contributions and earnings at the time of the contribution. Many of the federal income tax rules pertaining to Designated Roth Accounts have not yet been finalized. Both you and your employer should consult their own tax and legal advisors prior to making or permitting contributions to be made to a Qualified Roth Contribution Program. The following general tax rules are based on our understanding of the Code and any regulations issued through December 31, 2005, and are subject to change and to different interpretation as well as additional guidance in respect to areas not previously addressed: The employer must permit contributions under a pre-tax 403(b) plan in order to permit contributions to be irrevocably designated and made part of a Qualified Roth Contribution Program. Elective deferral contributions to the Designated Roth Account must be aggregated with all other elective deferral contributions made by a taxpayer for purposes of the individual Code Section 402(g) limits and the Code Section 414(v) limits (relating to age 50 and over catch-up contributions) as well as contribution limits that apply under the Plan. In general, the same tax law rules with respect to restricted monies, triggering events and permitted distributions will apply to the Designated Roth Accounts under the Plan as apply to the traditional pre-tax accounts under the plan (e.g., death or disability of participant, severance from employment, attainment of age 59 1/2 and hardship withdrawals only with respect to contributions (if permitted under the Plan)). If the amounts have been held under any Designated Roth Account of a participant for at least five years and are made on account of death, disability or after attainment of age 59 1/2, then any withdrawal, distribution or payment of these amounts is generally free of federal income tax ("Qualified Distributions"). Unlike Roth IRAs, withdrawal, distributions and payments that do not meet the five year rule will generally be taxed on a pro-rated basis with respect to earnings and after-tax contributions. The 10% penalty tax will generally apply on the same basis as a traditional pre-tax account under the Plan. Additionally, rollover distributions may only be made tax-free into another Designated Roth Account or into a Roth IRA. Some states may not permit contributions to be made to a Qualified Roth Contribution Program or may require additional conforming legislation for these rules to become effective. LOANS. If your TSA Contract permits loans, such loans will be made only from any Fixed Interest Account balance and only up to certain limits. In that case, we credit your Fixed Interest Account balance up to the amount of the outstanding loan balance with a rate of interest that is less than the interest rate we charge for the loan. 38 The Code and applicable income tax regulations limit the amount that may be borrowed from your Contract and all you employer plans in the aggregate and also require that loans be repaid, at a minimum, in scheduled level payments over a proscribed term. Your Contract will indicate whether loans are permitted. The terms of the loan are governed by the Contract and loan agreement. Failure to satisfy loan limits under the Code or to make any scheduled payments according to the terms of your loan agreement and Federal tax law could have adverse tax consequences. Consult a tax advisor and read your loan agreement and Contract prior to taking any loan. NON-QUALIFIED ANNUITY CONTRACTS If you purchase the Contract on an individual basis with after-tax dollars and not under one of the programs described above, your Contract is referred to as non-qualified. As the owner of a non-qualified annuity, you do not receive any tax benefit (deduction or deferral of income) on Purchase Payments, but you will not be taxed on increases in the value of your Contract until a distribution occurs -- either as a withdrawal made prior to the Maturity Date or in the form of periodic Annuity Payments. As a general rule, there is income in the Contract (earnings) to the extent the Contract Value exceeds your investment in the Contract. The investment in the Contract equals the total Purchase Payments less any amount received previously which was excludible from gross income. Generally, different tax rules apply to Annuity Payments than to withdrawals and payments received before the annuity starting date. When a withdrawal is made, you are taxed on the amount of the withdrawal that is considered earnings under federal tax laws. Similarly, when you receive an Annuity Payment, part of each periodic payment is considered a return of your Purchase Payments and will not be taxed, but the remaining portion of the Annuity Payment (i.e., any earnings) will be considered ordinary income for federal income tax purposes. Annuity Payments are subject to an "excludable amount" or "exclusion ratio" which determines how much of each payment is treated as: - a non-taxable return of your Purchase Payment; or - a taxable payment of earnings. We generally will tell you how much of each Annuity Payment is a non-taxable return of your Purchase Payments. However, it is possible that the IRS could conclude that the taxable portion of Annuity Payments under a non-qualified contract is an amount greater (or less) than the taxable amount determined by us and reported by us to you and the IRS. Generally, once the total amount treated as a non-taxable return of your Purchase Payments equals your Purchase Payments, then all remaining payments are fully taxable. We will withhold a portion of the taxable amount of your Annuity Payment for income taxes, unless you elect otherwise. The amount we withhold is determined by the Code. Code Section 72(s) requires that non-qualified annuity contracts meet minimum mandatory distribution requirements upon the death of the Contract Owner, including the death of either of the Joint Owners. If these requirements are not met, the Contract will not be treated as an annuity contract for federal income tax purposes and earnings under the Contract will be taxable currently, not when distributed. The distribution required depends, among other things, upon whether an annuity option is elected or whether the succeeding Contract Owner is the surviving spouse. We will administer contracts in accordance with these rules and we will notify you when you should begin receiving payments. There is a more complete discussion of these rules in the SAI. If a non-qualified annuity is owned by a non-natural person (e.g., a corporation), increases in the value of the Contract attributable to Purchase Payments made after February 28, 1986 are includable in income annually and taxed at ordinary income tax rates. Furthermore, for contracts issued after April 22, 1987, if the Contract is transferred to another person or entity without adequate consideration, all deferred increases in value will be treated as income for federal income tax purposes at the time of the transfer. PARTIAL WITHDRAWALS: If you make a partial withdrawal of your Contract Value, the distribution generally will be taxed as first coming from earnings (income in the Contract) and then from your Purchase Payments. These withdrawn earnings are includable in your taxable income. (See "Penalty Tax for Premature Distributions" below.) Any direct or indirect borrowing against the value of the Contract or pledging of the Contract as security for a loan will be treated as a cash distribution under the tax law, and will have tax consequences in the year taken. 39 PARTIAL ANNUITIZATIONS (IF AVAILABLE WITH YOUR CONTRACT): At the present time the IRS has not approved the use of an exclusion ratio or exclusion amount when only part of your Contract Value is applied to a payment option. Currently, we will treat the application of less than your entire Contract Value under a Non- qualified Contract to a payment option (i.e. taking Annuity Payments) as a taxable withdrawal for federal income tax purposes (which may also be subject to the 10% penalty tax if you are under age 59 1/2). We will then treat the amount of the withdrawal (after any deductions for taxes) as the purchase price of an income annuity and tax report the income payments received under that annuity under the rules for variable income annuities. Consult your tax attorney prior to partially annuitizing your Contract. We will determine the excludable amount for each income payment under the Contract as a whole by using the rules applicable to variable income payments in general (i.e. by dividing your after-tax purchase price, as adjusted for any refund or guarantee feature, by the number of expected income payments from the appropriate IRS table). However, the IRS may determine that the excludable amount is different from our computation. DIVERSIFICATION REQUIREMENTS FOR VARIABLE ANNUITIES The Code requires that any non-qualified variable annuity contracts based on a Separate Account must meet specific diversification standards. Non-qualified variable annuity contracts shall not be treated as an annuity for federal income tax purposes if investments made in the account are not adequately diversified. Final tax regulations define how Separate Accounts must be diversified. The Company constantly monitors the diversification of investments and believes that its accounts are adequately diversified. The consequence of any failure to diversify is essentially the loss to the Contract Owner of tax-deferred treatment, requiring the current inclusion of a proportionate share of the income and gains from the Separate Account assets in the income of each Contract Owner. The Company intends to administer all contracts subject to this provision of law in a manner that will maintain adequate diversification. OWNERSHIP OF THE INVESTMENTS In certain circumstances, owners of variable annuity contracts have been considered to be the owners of the assets of the underlying Separate Account for federal income tax purposes due to their ability to exercise investment control over those assets. When this is the case, the Contract Owners have been currently taxed on income and gains attributable to the Separate Account assets. There is little guidance in this area, and some features of the Contract, such as the number of funds available and the flexibility of the Contract Owner to allocate premium payments and transfer amounts among the funding options, have not been addressed in public rulings. While we believe that the Contract does not give the Contract Owner investment control over Separate Account assets, we reserve the right to modify the Contract as necessary to prevent a Contract Owner from being treated as the owner of the Separate Account assets supporting the Contract. TAXATION OF DEATH BENEFIT PROCEEDS Amounts may be distributed from a Non-qualified Contract because of the death of an owner or Annuitant. Generally, such amounts are includable in the income of the recipient as follows: (i) if distributed in a lump sum, they are taxed in the same manner as a full surrender of the Contract; or (ii) if distributed under a payment option, they are taxed in the same way as Annuity Payments. OTHER TAX CONSIDERATIONS TREATMENT OF CHARGES FOR OPTIONAL BENEFITS The Contract may provide one or more optional enhanced death benefits or other minimum guaranteed benefit that in some cases may exceed the greater of purchase price or the Contract Value. It is possible that the Internal Revenue Service may take the position that the charges for the optional enhanced benefit(s) are deemed to be taxable distributions to you. Although we do not believe that a charge under such optional enhanced benefit should be treated as a taxable withdrawal, you should consult with your tax adviser before selecting any rider or endorsement to the Contract. 40 PUERTO RICO TAX CONSIDERATIONS The Puerto Rico Internal Revenue Code of 1994 (the "1994 Code") taxes distributions from non-qualified annuity contracts differently than in the U.S. Distributions that are not in the form of an annuity (including partial surrenders and period certain payments) are treated under the 1994 Code first as a return of investment. Therefore, a substantial portion of the amounts distributed generally will be excluded from gross income for Puerto Rico tax purposes until the cumulative amount paid exceeds your tax basis. The amount of income on annuity distributions (payable over your lifetime) is also calculated differently under the 1994 Code. Since Puerto Rico residents are also subject to U.S. income tax on all income other than income sourced to Puerto Rico and the Internal Revenue Service issued guidance in 2004 which indicated that the income from an annuity contract issued by a U.S. life insurer would be considered U.S. source income, the timing of recognition of income from an annuity contract could vary between the two jurisdictions. Although the 1994 Code provides a credit against the Puerto Rico income tax for U.S. income taxes paid, an individual may not get full credit because of the timing differences. You should consult with a personal tax adviser regarding the tax consequences of purchasing an annuity contract and/or any proposed distribution, particularly a partial distribution or election to annuitize. NON-RESIDENT ALIENS Distributions to non resident aliens ("NRAs") are subject to special and complex tax and withholding rules under the Code with respect to U.S. source income, some of which are based upon the particular facts and circumstances of the Contract Owner, the beneficiary and the transaction itself. As stated above, the IRS has taken the position that income from the Contract received by NRAs is considered U.S. source income. In addition, Annuity Payments to NRAs in many countries are exempt from U.S. tax (or subject to lower rates) based upon a tax treaty, provided that the Contract Owner complies with the applicable requirements. NRAs should seek guidance from a tax adviser regarding their personal situation. TAX CREDITS AND DEDUCTIONS The Company may be entitled to certain tax benefits related to the assets of the Separate Account. These tax benefits, which may include foreign tax credits and corporate dividend received deductions, are not passed back to the Separate Account or to Contract Owners since the Company is the owner of the assets from which the tax benefits are derived. OTHER INFORMATION -------------------------------------------------------------------------------- Vintage is a service mark of Citigroup, Inc. or its affiliates and is used by MetLife, Inc. and its affiliates under license. THE INSURANCE COMPANY Please refer to your Contract to determine which Company issued your Contract. MetLife Insurance Company of Connecticut is a stock insurance company chartered in 1863 in Connecticut and continuously engaged in the insurance business since that time. It is licensed to conduct life insurance business in all states of the United States, the District of Columbia, Puerto Rico, Guam, the U.S. and British Virgin Islands and the Bahamas. The Company is a wholly-owned subsidiary of MetLife, Inc., a publicly-traded company. MetLife, Inc., through its subsidiaries and affiliates, is a leading provider of insurance and other financial services to individual and institutional customers. The Company's Home Office is located at One Cityplace, Hartford, Connecticut 06103-3415. Before December 7, 2007, certain of the Contracts were issued by MetLife Life and Annuity Company of Connecticut, a stock life insurance company chartered in 1973 in Connecticut. These Contracts were funded through Fund BD II, a separate account registered with the SEC as a unit investment trust under the Investment Company Act of 1940, as amended. On December 7, 2007, MLACC, a wholly-owned subsidiary of the Company and an indirect, wholly-owned subsidiary of MetLife, Inc., merged with and into the Company. Upon consummation of the merger, MLACC's corporate existence ceased by operation of law, and the Company assumed legal ownership of all of the assets of MLACC, including Fund BD II and its assets. Pursuant to the merger, therefore, Fund BD II became a 41 separate account of the Company. As a result of the merger, the Company also has become responsible for all of MLACC's liabilities and obligations, including those created under the Contract as initially issued by MLACC (formerly known as The Travelers Life and Annuity Company) and outstanding on the date of the merger. The Contract has thereby become a variable contract funded by a separate account of the Company, and each owner thereof has become a Contract Owner of the Company. FINANCIAL STATEMENTS The financial statements for the Company and its Separate Account are located in the Statement of Additional Information. DISTRIBUTION OF VARIABLE ANNUITY CONTRACTS DISTRIBUTION AND PRINCIPAL UNDERWRITING AGREEMENT. MetLife Insurance Company of Connecticut (the "Company") has appointed MetLife Investors Distribution Company ("MLIDC") to serve as the principal underwriter and distributor of the securities offered through this Prospectus, pursuant to the terms of a Distribution and Principal Underwriting Agreement. MLIDC, which is an affiliate of the Company, also acts as the principal underwriter and distributor of other variable annuity contracts and variable life insurance policies issued by the Company and its affiliated companies. The Company reimburses MLIDC for expenses MLIDC incurs in distributing the Contracts (e.g. commissions payable to retail broker-dealers who sell the Contracts). MLIDC does not retain any fees under the Contracts; however, MLIDC may receive 12b-1 fees from the Underlying Funds. MLIDC's principal executive offices are located at 5 Park Plaza, Suite 1900, Irvine, California 92614. MLIDC is registered as a broker-dealer with the Securities and Exchange Commission ("SEC") under the Securities Exchange Act of 1934, as well as the securities commissions in the states in which it operates, and is a member of the Financial Industry Regulatory Authority (FINRA). An investor brochure that includes information describing FINRA's Public Disclosure Program is available by calling FINRA's Public Disclosure Program hotline at 1- 800-289-9999, or by visiting FINRA's website at www.finra.org. MLIDC and the Company enter into selling agreements with affiliated and unaffiliated broker-dealers who are registered with the SEC and are members of FINRA, and with entities that may offer the Contracts but are exempt from registration. Applications for the Contract are solicited by registered representatives who are associated persons of such affiliated or unaffiliated broker-dealer firms. Such representatives act as appointed agents of the Company under applicable state insurance law and must be licensed to sell variable insurance products. The Company no longer offers the Contracts to new purchasers but it continues to accept Purchase Payments from Contract Owners. COMPENSATION. Broker-dealers who have selling agreements with MLIDC and the Company are paid compensation for the promotion and sale of the Contracts. Registered representatives who solicit sales of the Contract typically receive a portion of the compensation payable to the broker-dealer firm. The amount the registered representative receives depends on the agreement between the firm and the registered representative. This agreement may also provide for the payment of other types of cash and non-cash compensation and other benefits. A broker- dealer firm or registered representative of a firm may receive different compensation for selling one product over another and/or may be inclined to favor one product provider over another product provider due to differing compensation rates. We generally pay compensation as a percentage of purchase payments invested in the Contract. Alternatively, we may pay lower compensation on purchase payments but pay periodic asset-based compensation based on all or a portion of the Contract Value. The amount and timing of compensation may vary depending on the selling agreement but is not expected to exceed 7.50% of Purchase Payments (if up-front compensation is paid to registered representatives) and up to 1.50% annually of average Contract Value (if asset-based compensation is paid to registered representatives). We pay American Funds Distributors, Inc., principal underwriter for the American Funds Insurance Series, a percentage of all Purchase Payments allocated to the funds in the American Funds Insurance Series for services it provides in marketing the Funds' shares in connection with the Contract. The Company and MLIDC have also entered into preferred distribution arrangements with certain broker-dealer firms. These arrangements are sometimes called "shelf space" arrangements. Under these arrangements, the Company and MLIDC pay separate, additional compensation to the broker-dealer firm for services the broker-dealer provides in 42 connection with the distribution of the Company's products. These services may include providing the Company with access to the distribution network of the broker-dealer, the hiring and training of the broker-dealer's sales personnel, the sponsoring of conferences and seminars by the broker-dealer, or general marketing services performed by the broker-dealer. The broker-dealer may also provide other services or incur other costs in connection with distributing the Company's products. These preferred distribution arrangements will not be offered to all broker- dealer firms and the terms of such arrangements may differ between broker-dealer firms. Compensation payable under such arrangements may be based on aggregate, net or anticipated sales of the Contracts, total assets attributable to sales of the Contract by registered representatives of the broker-dealer firm or based on the length of time that a Contract Owner has owned the Contract. Any such compensation payable to a broker-dealer firm will be made by MLIDC or the Company out of their own assets and will not result in any additional direct charge to you. Such compensation may cause the broker-dealer firm and its registered representatives to favor the Company's products. The Company and MLIDC have entered into selling agreements with certain broker- dealer firms that have an affiliate that acts as investment adviser or sub- adviser to one or more Underlying Funds that may be offered under the Contracts. These investment advisory firms include Fidelity Management & Research Company, Morgan Stanley Investment Advisers Inc., MetLife Investment Funds Management LLC, MetLife Advisers, LLC and Met Investors Advisory LLC. MetLife Investment Funds Management LLC, MetLife Advisers LLC and Met Investors Advisory LLC are affiliates of the Company. Registered representatives of broker-dealer firms with an affiliated company acting as an adviser or a sub-adviser may favor these Funds when offering the Contracts. CONFORMITY WITH STATE AND FEDERAL LAWS The laws of the state in which we deliver a contract govern that Contract. Where a state has not approved a contract feature or funding option, it will not be available in that state. Any paid-up annuity, Cash Surrender Value or death benefits that are available under the Contract are not less than the minimum benefits required by the statutes of the state in which we delivered the Contract. We reserve the right to make any changes, including retroactive changes, in the Contract to the extent that the change is required to meet the requirements of any law or regulation issued by any governmental agency to which the Company, the Contract or the Contract Owner is subject. VOTING RIGHTS The Company is the legal owner of the shares of the Underlying Funds. However, we believe that when an Underlying Fund solicits proxies in conjunction with a vote of shareholders we are required to obtain from you and from other owners instructions on how to vote those shares. We will vote all shares, including those we may own on our own behalf, and those where we have not received instructions from Contract Owners, in the same proportion as shares for which we received voting instructions. The effect of this proportional voting is that a small number of Contract Owners may control the outcome of a vote. Should we determine that we are no longer required to comply with the above, we will vote the shares in our own right. In certain limited circumstances, and when permitted by law, we may disregard voting instructions. If we do disregard voting instructions, a summary of that action and the reasons for such action would be included in the next annual report to Contract Owners. RESTRICTIONS ON FINANCIAL TRANSACTIONS Federal laws designed to counter terrorism and prevent money laundering might, in certain circumstances, require us to block a Contract Owner's ability to make certain transactions and thereby refuse to accept any request for transfers, withdrawals, surrenders, or death benefits, until the instructions are received from the appropriate regulator. We may also be required to provide additional information about you and your Contract to government regulators. LEGAL PROCEEDINGS In the ordinary course of business, the Company, similar to other life insurance companies, is involved in lawsuits (including class action lawsuits), arbitrations and other legal proceedings. Also, from time to time, state and federal regulators or other officials conduct formal and informal examinations or undertake other actions dealing with various aspects of the financial services and insurance industries. In some legal proceedings involving insurers, substantial damages have been sought and/or material settlement payments have been made. 43 It is not possible to predict with certainty the ultimate outcome of any pending legal proceeding or regulatory action. However, the Company does not believe any such action or proceeding will have a material adverse effect upon the Separate Account or upon the ability of MLIDC to perform its contract with the Separate Account or of the Company to meet its obligations under the Contracts. 44 APPENDIX A -------------------------------------------------------------------------------- CONDENSED FINANCIAL INFORMATION FOR METLIFE OF CT FUND BD FOR VARIABLE ANNUITIES ACCUMULATION UNIT VALUES (IN DOLLARS) The following Accumulation Unit Value ("AUV") information should be read in conjunction with the Separate Account's audited financial statement and notes, which are included in the Statement of Additional Information ("SAI"). The first table provides the AUV information for the MINIMUM Separate Account Charge available under the contract. The second table provides the AUV information for the MAXIMUM Separate Account Charge available under the contract. Please refer to the Fee Table section of this prospectus for more information on Separate Account Charges. VINTAGE -- SEPARATE ACCOUNT CHARGES 1.17%
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- AIM Variable Insurance Funds AIM V.I. Core Equity Subaccount (Series I) (4/06).. 2007 1.083 1.161 -- 2006 1.000 1.083 36,488 AIM V.I. Premier Equity Subaccount (Series I) (5/01)............................................. 2006 0.825 0.867 -- 2005 0.790 0.825 49,691 2004 0.755 0.790 49,723 2003 0.611 0.755 75,908 2002 0.886 0.611 450,377 2001 1.000 0.886 668,710 AllianceBernstein Variable Products Series Fund, Inc. AllianceBernstein Large-Cap Growth Subaccount (Class B) (5/01)................................... 2006 0.868 0.852 -- 2005 0.764 0.868 273,732 2004 0.714 0.764 445,460 2003 0.585 0.714 511,962 2002 0.857 0.585 546,050 2001 1.000 0.857 297,549 American Funds Insurance Series American Funds Global Growth Subaccount (Class 2) (5/01)............................................. 2007 1.487 1.688 3,259,064 2006 1.249 1.487 3,816,183 2005 1.108 1.249 4,089,192 2004 0.988 1.108 4,084,784 2003 0.739 0.988 2,904,801 2002 0.876 0.739 2,231,042 2001 1.000 0.876 802,933
A-1 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.17% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- American Funds Growth Subaccount (Class 2) (5/01).. 2007 1.197 1.329 6,393,331 2006 1.099 1.197 7,693,917 2005 0.957 1.099 8,460,306 2004 0.860 0.957 8,964,439 2003 0.636 0.860 8,634,706 2002 0.852 0.636 5,528,439 2001 1.000 0.852 1,775,888 American Funds Growth-Income Subaccount (Class 2) (5/01)............................................. 2007 1.328 1.378 6,295,142 2006 1.166 1.328 7,453,818 2005 1.115 1.166 8,543,297 2004 1.022 1.115 9,809,591 2003 0.781 1.022 9,887,549 2002 0.967 0.781 6,543,536 2001 1.000 0.967 2,371,512 Dreyfus Variable Investment Fund Dreyfus VIF Developing Leaders Subaccount (Initial Shares) (5/98)..................................... 2007 1.324 1.164 1,329,019 2006 1.291 1.324 1,751,850 2005 1.235 1.291 2,149,343 2004 1.122 1.235 2,640,571 2003 0.862 1.122 3,128,195 2002 1.078 0.862 3,595,868 2001 1.162 1.078 3,233,826 2000 1.038 1.162 3,583,484 1999 0.852 1.038 2,129,773 1998 1.000 0.852 1,024,905 Legg Mason Partners Investment Series LMPIS Premier Selections All Cap Growth Subaccount (5/01)............................................. 2007 0.975 1.040 -- 2006 0.919 0.975 929,498 2005 0.875 0.919 1,520,198 2004 0.860 0.875 1,659,510 2003 0.648 0.860 1,657,215 2002 0.896 0.648 680,370 2001 1.000 0.896 233,523 Legg Mason Partners Variable Equity Trust LMPVET Aggressive Growth Subaccount (Class I) (4/07)............................................. 2007 1.030 0.996 626,387 LMPVET Capital and Income Subaccount (Class I) (4/07)............................................. 2007 1.373 1.383 264,636
A-2 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.17% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- LMPVET Dividend Strategy Subaccount (5/01)......... 2007 0.939 0.988 232,014 2006 0.805 0.939 283,117 2005 0.816 0.805 221,733 2004 0.799 0.816 281,085 2003 0.655 0.799 554,679 2002 0.895 0.655 364,889 2001 1.000 0.895 441,029 LMPVET Equity Index Subaccount (Class II) (5/99)... 2007 1.046 1.084 813,079 2006 0.919 1.046 946,074 2005 0.892 0.919 1,416,432 2004 0.818 0.892 1,746,644 2003 0.648 0.818 2,376,230 2002 0.845 0.648 2,780,694 2001 0.976 0.845 3,052,737 2000 1.088 0.976 2,024,943 1999 1.000 1.088 1,741,701 LMPVET Fundamental Value Subaccount (Class I) (11/94)............................................ 2007 3.404 3.407 11,105,469 2006 2.948 3.404 14,164,874 2005 2.847 2.948 18,647,860 2004 2.662 2.847 24,106,289 2003 1.942 2.662 29,927,751 2002 2.497 1.942 36,718,095 2001 2.667 2.497 46,360,039 2000 2.240 2.667 55,492,831 1999 1.857 2.240 65,203,019 1998 1.790 1.857 73,467,726 LMPVET International All Cap Opportunity Subaccount (6/94)............................................. 2007 1.642 1.726 11,867,678 2006 1.320 1.642 14,976,623 2005 1.195 1.320 18,446,461 2004 1.026 1.195 23,196,293 2003 0.814 1.026 29,382,959 2002 1.109 0.814 36,517,428 2001 1.630 1.109 49,462,447 2000 2.164 1.630 63,128,882 1999 1.305 2.164 72,748,400 1998 1.240 1.305 82,330,241
A-3 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.17% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- LMPVET Investors Subaccount (Class I) (5/98)....... 2007 1.613 1.656 18,409,661 2006 1.380 1.613 2,006,577 2005 1.310 1.380 3,009,783 2004 1.201 1.310 3,433,092 2003 0.918 1.201 3,570,075 2002 1.207 0.918 3,952,134 2001 1.275 1.207 4,597,550 2000 1.119 1.275 1,901,624 1999 1.014 1.119 1,845,539 1998 1.000 1.014 704,294 LMPVET Large Cap Growth Subaccount (Class I) (5/98)............................................. 2007 1.471 1.531 3,824,418 2006 1.423 1.471 5,691,735 2005 1.368 1.423 7,749,638 2004 1.379 1.368 10,814,819 2003 0.945 1.379 13,098,784 2002 1.272 0.945 14,669,240 2001 1.471 1.272 23,676,786 2000 1.599 1.471 27,150,090 1999 1.237 1.599 25,851,563 1998 1.000 1.237 12,224,352 LMPVET Lifestyle Allocation 50% Subaccount (3/97).. 2007 1.609 1.642 1,246,953 2006 1.505 1.609 1,451,230 2005 1.485 1.505 1,984,977 2004 1.396 1.485 2,221,117 2003 1.174 1.396 2,560,375 2002 1.270 1.174 3,121,798 2001 1.303 1.270 3,742,546 2000 1.258 1.303 3,561,033 1999 1.183 1.258 3,958,544 1998 1.093 1.183 4,046,998 LMPVET Lifestyle Allocation 70% Subaccount (3/97).. 2007 1.483 1.522 704,404 2006 1.378 1.483 746,301 2005 1.331 1.378 862,931 2004 1.239 1.331 1,158,365 2003 0.965 1.239 1,584,448 2002 1.192 0.965 2,169,501 2001 1.338 1.192 2,631,461 2000 1.421 1.338 2,951,806 1999 1.238 1.421 3,487,443 1998 1.099 1.238 3,135,267
A-4 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.17% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- LMPVET Lifestyle Allocation 85% Subaccount (3/97).. 2007 1.570 1.604 222,171 2006 1.451 1.570 232,742 2005 1.384 1.451 295,346 2004 1.266 1.384 420,556 2003 0.936 1.266 499,464 2002 1.242 0.936 574,369 2001 1.429 1.242 618,220 2000 1.558 1.429 707,214 1999 1.242 1.558 807,243 1998 1.090 1.242 723,814 LMPVET Small Cap Growth Subaccount (Class I) (4/07)............................................. 2007 1.356 1.400 605,003 Legg Mason Partners Variable Income Trust LMPVIT High Income Subaccount (6/94)............... 2007 1.863 1.847 4,502,879 2006 1.699 1.863 5,684,073 2005 1.675 1.699 7,676,239 2004 1.534 1.675 10,075,486 2003 1.217 1.534 13,435,291 2002 1.273 1.217 17,114,943 2001 1.338 1.273 22,158,369 2000 1.472 1.338 28,815,814 1999 1.452 1.472 38,357,097 1998 1.463 1.452 44,406,204 LMPVIT Money Market Subaccount (6/94).............. 2007 1.374 1.425 6,573,034 2006 1.329 1.374 7,717,928 2005 1.308 1.329 9,289,976 2004 1.311 1.308 12,948,924 2003 1.318 1.311 19,072,257 2002 1.317 1.318 34,637,166 2001 1.285 1.317 40,479,011 2000 1.226 1.285 33,979,597 1999 1.184 1.226 45,052,907 1998 1.140 1.184 47,120,777 Legg Mason Partners Variable Portfolios V LMPVPV Small Cap Growth Opportunities Subaccount (Class I) (5/01)................................... 2007 1.290 1.379 -- 2006 1.156 1.290 697,770 2005 1.115 1.156 1,519,218 2004 0.976 1.115 1,354,383 2003 0.696 0.976 1,401,009 2002 0.947 0.696 529,979 2001 1.000 0.947 443,888
A-5 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.17% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- Legg Mason Partners Variable Portfolios I, Inc. LMPVPI Total Return Subaccount (Class I) (5/98).... 2007 1.338 1.378 -- 2006 1.203 1.338 346,955 2005 1.178 1.203 550,872 2004 1.096 1.178 792,837 2003 0.956 1.096 996,893 2002 1.039 0.956 1,278,668 2001 1.060 1.039 1,200,238 2000 0.994 1.060 845,563 1999 0.997 0.994 769,348 1998 1.000 0.997 397,259 Legg Mason Partners Variable Portfolios III, Inc. LMPVPIII Large Cap Value Subaccount (6/94)......... 2007 2.606 2.743 -- 2006 2.229 2.606 12,885,722 2005 2.118 2.229 16,412,848 2004 1.937 2.118 21,065,983 2003 1.536 1.937 25,941,256 2002 2.083 1.536 33,420,816 2001 2.296 2.083 45,558,878 2000 2.053 2.296 55,091,429 1999 2.076 2.053 67,687,987 1998 1.913 2.076 71,417,242 Met Investors Series Trust MIST Batterymarch Mid-Cap Stock Subaccount (Class A) (4/06).......................................... 2007 1.952 2.046 1,931,071 2006 2.044 1.952 2,428,155 MIST BlackRock Large-Cap Core Subaccount (Class A) (4/06)............................................. 2007 1.150 1.208 -- 2006 1.083 1.150 706,671 MIST BlackRock Large-Cap Core Subaccount (Class E) (4/07)............................................. 2007 1.198 1.210 488,139 MIST Lord Abbett Bond Debenture Subaccount (Class A) (4/06).......................................... 2007 1.717 1.813 605,543 2006 1.634 1.717 697,927 MIST Met/AIM Capital Appreciation Subaccount (Class A) (4/06).......................................... 2007 1.514 1.674 12,482,254 2006 1.528 1.514 15,647,229 MIST Pioneer Strategic Income Subaccount (Class A) (4/06)............................................. 2007 1.961 2.067 7,507,543 2006 1.888 1.961 9,100,597 Metropolitan Series Fund, Inc. MSF BlackRock Aggressive Growth Subaccount (Class D) (4/06).......................................... 2007 1.097 1.306 4,298,057 2006 1.121 1.097 6,038,096
A-6 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.17% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- MSF BlackRock Bond Income Subaccount (Class E) (4/06)............................................. 2007 1.672 1.753 3,546,440 2006 1.606 1.672 4,325,519 MSF Capital Guardian U.S. Equity Subaccount (Class A) (4/06) *........................................ 2007 2.160 2.133 6,951,981 2006 2.095 2.160 8,916,046 MSF FI Large Cap Subaccount (Class A) (4/06)....... 2007 1.016 1.044 46,151,455 2006 1.000 1.016 59,467,672 MSF MFS(R) Total Return Subaccount (Class F) (4/06)............................................. 2007 2.817 2.900 14,407,163 2006 2.628 2.817 18,208,466 MSF T. Rowe Price Large Cap Growth Subaccount (Class B) (4/06)................................... 2007 1.072 1.156 184,822 2006 0.998 1.072 258,683 MSF Western Asset Management Strategic Bond Opportunities Subaccount (Class A) (4/06).......... 2007 1.905 1.958 2,011,707 2006 1.822 1.905 2,307,590 The Travelers Series Trust Travelers AIM Capital Appreciation Subaccount (10/95)............................................ 2006 1.433 1.528 -- 2005 1.333 1.433 21,247,306 2004 1.267 1.333 27,573,752 2003 0.991 1.267 34,875,318 2002 1.317 0.991 43,597,234 2001 1.748 1.317 58,613,993 2000 1.974 1.748 74,130,562 1999 1.397 1.974 81,401,202 1998 1.206 1.397 90,905,019 Travelers Convertible Securities Subaccount (6/98)............................................. 2006 1.531 1.634 -- 2005 1.543 1.531 863,873 2004 1.469 1.543 1,082,850 2003 1.177 1.469 1,192,485 2002 1.280 1.177 1,982,316 2001 1.306 1.280 2,206,650 2000 1.175 1.306 1,168,231 1999 1.001 1.175 626,884 1998 1.000 1.001 248,991
A-7 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.17% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- Travelers Disciplined Mid Cap Stock Subaccount (5/98)............................................. 2006 1.869 2.044 -- 2005 1.682 1.869 3,316,718 2004 1.461 1.682 3,783,231 2003 1.105 1.461 3,810,819 2002 1.305 1.105 4,509,768 2001 1.376 1.305 4,124,695 2000 1.194 1.376 3,158,686 1999 1.064 1.194 1,843,199 1998 1.000 1.064 397,554 Travelers Managed Income Subaccount (6/94)......... 2006 1.619 1.606 -- 2005 1.616 1.619 5,339,484 2004 1.590 1.616 7,066,638 2003 1.483 1.590 9,092,631 2002 1.469 1.483 11,833,198 2001 1.392 1.469 13,910,891 2000 1.306 1.392 13,842,174 1999 1.309 1.306 17,250,745 1998 1.261 1.309 20,492,138 Travelers Mercury Large Cap Core Subaccount (5/98)............................................. 2006 1.019 1.083 -- 2005 0.920 1.019 852,850 2004 0.803 0.920 1,065,482 2003 0.671 0.803 1,579,231 2002 0.906 0.671 2,067,818 2001 1.183 0.906 3,143,694 2000 1.267 1.183 3,989,985 1999 1.037 1.267 3,898,421 1998 1.000 1.037 1,353,759 Travelers MFS(R) Mid Cap Growth Subaccount (2/05).. 2006 1.058 1.121 -- 2005 1.000 1.058 8,070,019 Travelers MFS(R) Total Return Subaccount (6/94).... 2006 2.542 2.628 -- 2005 2.498 2.542 24,050,671 2004 2.268 2.498 29,790,919 2003 1.969 2.268 37,607,488 2002 2.103 1.969 44,972,133 2001 2.127 2.103 54,056,696 2000 1.845 2.127 64,462,637 1999 1.819 1.845 78,484,497 1998 1.648 1.819 86,949,854
A-8 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.17% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- Travelers Pioneer Strategic Income Subaccount (6/94)............................................. 2006 1.867 1.888 -- 2005 1.822 1.867 11,588,555 2004 1.661 1.822 14,941,189 2003 1.406 1.661 18,272,707 2002 1.344 1.406 23,732,550 2001 1.304 1.344 28,854,109 2000 1.325 1.304 37,822,306 1999 1.326 1.325 45,594,724 1998 1.332 1.326 53,053,274 Travelers Salomon Brothers Strategic Total Return Bond Subaccount (6/94)............................. 2006 1.848 1.822 -- 2005 1.827 1.848 2,904,596 2004 1.739 1.827 3,672,857 2003 1.553 1.739 5,037,212 2002 1.450 1.553 5,507,970 2001 1.378 1.450 5,251,702 2000 1.319 1.378 6,890,789 1999 1.359 1.319 8,990,726 1998 1.397 1.359 11,299,081 Travelers Strategic Equity Subaccount (6/94)....... 2006 2.482 2.594 -- 2005 2.461 2.482 30,239,137 2004 2.259 2.461 39,371,551 2003 1.724 2.259 49,020,099 2002 2.627 1.724 60,860,309 2001 3.068 2.627 84,551,493 2000 3.795 3.068 110,497,118 1999 2.903 3.795 131,228,285 1998 2.276 2.903 142,801,580 Travelers Van Kampen Enterprise Subaccount (6/94).. 2006 2.015 2.095 -- 2005 1.891 2.015 11,781,590 2004 1.842 1.891 15,562,554 2003 1.484 1.842 19,773,015 2002 2.125 1.484 24,341,031 2001 2.731 2.125 32,559,084 2000 3.238 2.731 43,294,726 1999 2.601 3.238 50,445,762 1998 2.103 2.601 55,902,505
A-9 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.45%
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- AIM Variable Insurance Funds AIM V.I. Core Equity Subaccount (Series I) (4/06).. 2007 1.081 1.158 -- 2006 1.000 1.081 15,388 AIM V.I. Premier Equity Subaccount (Series I) (5/01)............................................. 2006 0.814 0.855 -- 2005 0.782 0.814 17,992 2004 0.750 0.782 -- 2003 0.608 0.750 12,043 2002 0.885 0.608 -- 2001 1.000 0.885 62,490 AllianceBernstein Variable Products Series Fund, Inc. AllianceBernstein Large-Cap Growth Subaccount (Class B) (5/01)................................... 2006 0.856 0.839 -- 2005 0.757 0.856 75,075 2004 0.709 0.757 90,390 2003 0.583 0.709 164,993 2002 0.855 0.583 98,794 2001 1.000 0.855 220,509 American Funds Insurance Series American Funds Global Growth Subaccount (Class 2) (5/01)............................................. 2007 1.463 1.656 572,657 2006 1.233 1.463 635,376 2005 1.097 1.233 576,306 2004 0.980 1.097 385,941 2003 0.735 0.980 246,731 2002 0.874 0.735 186,424 2001 1.000 0.874 42,484 American Funds Growth Subaccount (Class 2) (5/01).. 2007 1.178 1.304 1,013,539 2006 1.084 1.178 1,020,451 2005 0.947 1.084 1,164,467 2004 0.854 0.947 1,170,991 2003 0.633 0.854 1,297,330 2002 0.850 0.633 1,169,096 2001 1.000 0.850 249,033 American Funds Growth-Income Subaccount (Class 2) (5/01)............................................. 2007 1.307 1.353 1,151,524 2006 1.151 1.307 1,213,983 2005 1.103 1.151 2,026,786 2004 1.014 1.103 2,168,615 2003 0.777 1.014 1,567,244 2002 0.965 0.777 1,363,147 2001 1.000 0.965 735,883
A-10 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.45% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- Dreyfus Variable Investment Fund Dreyfus VIF Developing Leaders Subaccount (Initial Shares) (5/98)..................................... 2007 1.292 1.133 77,226 2006 1.264 1.292 121,376 2005 1.212 1.264 165,344 2004 1.104 1.212 618,001 2003 0.851 1.104 841,633 2002 1.067 0.851 569,457 2001 1.153 1.067 333,484 2000 1.033 1.153 475,404 1999 0.851 1.033 301,650 1998 1.000 0.851 49,426 Legg Mason Partners Investment Series LMPIS Premier Selections All Cap Growth Subaccount (5/01)............................................. 2007 0.960 1.022 -- 2006 0.907 0.960 121,731 2005 0.866 0.907 122,127 2004 0.854 0.866 243,584 2003 0.645 0.854 182,965 2002 0.894 0.645 426,644 2001 1.000 0.894 90,901 Legg Mason Partners Variable Equity Trust LMPVET Aggressive Growth Subaccount (Class I) (4/07)............................................. 2007 1.013 0.978 121,376 LMPVET Capital and Income Subaccount (Class I) (4/07)............................................. 2007 1.338 1.346 49,817 LMPVET Dividend Strategy Subaccount (5/01)......... 2007 0.924 0.969 11,286 2006 0.795 0.924 11,300 2005 0.808 0.795 47,800 2004 0.793 0.808 91,054 2003 0.652 0.793 61,630 2002 0.893 0.652 17,317 2001 1.000 0.893 -- LMPVET Equity Index Subaccount (Class II) (5/99)... 2007 1.023 1.058 158,554 2006 0.902 1.023 159,583 2005 0.878 0.902 328,610 2004 0.808 0.878 391,851 2003 0.642 0.808 501,650 2002 0.839 0.642 647,264 2001 0.971 0.839 199,427 2000 1.086 0.971 172,120 1999 1.000 1.086 78,197
A-11 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.45% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- LMPVET Fundamental Value Subaccount (Class I) (11/94)............................................ 2007 3.290 3.284 1,456,624 2006 2.858 3.290 2,043,548 2005 2.767 2.858 2,746,227 2004 2.595 2.767 3,806,079 2003 1.899 2.595 4,976,343 2002 2.448 1.899 5,662,520 2001 2.622 2.448 6,985,229 2000 2.208 2.622 8,605,537 1999 1.836 2.208 10,465,245 1998 1.775 1.836 11,653,902 LMPVET International All Cap Opportunity Subaccount (6/94)............................................. 2007 1.585 1.661 2,542,786 2006 1.278 1.585 3,053,662 2005 1.161 1.278 3,668,880 2004 0.999 1.161 4,592,678 2003 0.795 0.999 5,570,530 2002 1.086 0.795 6,526,506 2001 1.601 1.086 8,902,580 2000 2.131 1.601 11,816,707 1999 1.289 2.131 15,530,355 1998 1.228 1.289 17,670,056 LMPVET Investors Subaccount (Class I) (5/98)....... 2007 1.574 1.612 3,202,368 2006 1.350 1.574 200,080 2005 1.286 1.350 244,035 2004 1.182 1.286 601,184 2003 0.906 1.182 755,600 2002 1.195 0.906 646,567 2001 1.265 1.195 766,415 2000 1.114 1.265 250,413 1999 1.012 1.114 171,466 1998 1.000 1.012 75,864 LMPVET Large Cap Growth Subaccount (Class I) (5/98)............................................. 2007 1.435 1.490 733,177 2006 1.392 1.435 1,039,927 2005 1.343 1.392 1,502,013 2004 1.357 1.343 2,036,808 2003 0.933 1.357 2,464,721 2002 1.259 0.933 2,575,008 2001 1.460 1.259 3,245,914 2000 1.592 1.460 3,984,628 1999 1.234 1.592 3,416,335 1998 1.000 1.234 1,022,328
A-12 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.45% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- LMPVET Lifestyle Allocation 50% Subaccount (3/97).. 2007 1.566 1.593 445,384 2006 1.468 1.566 534,469 2005 1.453 1.468 653,723 2004 1.370 1.453 729,632 2003 1.155 1.370 742,664 2002 1.253 1.155 839,760 2001 1.290 1.253 893,618 2000 1.248 1.290 778,489 1999 1.177 1.248 922,423 1998 1.091 1.177 1,086,882 LMPVET Lifestyle Allocation 70% Subaccount (3/97).. 2007 1.443 1.476 671,042 2006 1.345 1.443 765,519 2005 1.302 1.345 794,034 2004 1.216 1.302 847,668 2003 0.950 1.216 917,612 2002 1.176 0.950 989,634 2001 1.323 1.176 1,678,477 2000 1.410 1.323 1,838,058 1999 1.232 1.410 1,847,452 1998 1.097 1.232 1,838,554 LMPVET Lifestyle Allocation 85% Subaccount (3/97).. 2007 1.527 1.556 19,117 2006 1.416 1.527 118,396 2005 1.354 1.416 166,806 2004 1.242 1.354 185,463 2003 0.921 1.242 237,262 2002 1.225 0.921 222,093 2001 1.414 1.225 225,839 2000 1.546 1.414 226,088 1999 1.236 1.546 319,187 1998 1.087 1.236 325,871 LMPVET Small Cap Growth Subaccount (Class I) (4/07)............................................. 2007 1.333 1.375 178,297
A-13 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.45% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- Legg Mason Partners Variable Income Trust LMPVIT High Income Subaccount (6/94)............... 2007 1.799 1.778 804,432 2006 1.645 1.799 1,318,593 2005 1.626 1.645 1,763,948 2004 1.494 1.626 2,423,115 2003 1.189 1.494 3,064,466 2002 1.246 1.189 3,806,067 2001 1.314 1.246 4,788,057 2000 1.450 1.314 5,829,717 1999 1.434 1.450 8,209,532 1998 1.448 1.434 9,311,914 LMPVIT Money Market Subaccount (6/94).............. 2007 1.327 1.372 1,141,884 2006 1.286 1.327 1,316,271 2005 1.270 1.286 1,565,697 2004 1.277 1.270 2,220,744 2003 1.287 1.277 3,445,461 2002 1.289 1.287 5,718,355 2001 1.262 1.289 5,797,292 2000 1.207 1.262 4,483,256 1999 1.169 1.207 6,608,638 1998 1.129 1.169 8,253,674 Legg Mason Partners Variable Portfolios V LMPVPV Small Cap Growth Opportunities Subaccount (Class I) (5/01)................................... 2007 1.270 1.356 -- 2006 1.141 1.270 188,838 2005 1.104 1.141 199,104 2004 0.969 1.104 290,200 2003 0.692 0.969 202,946 2002 0.945 0.692 70,815 2001 1.000 0.945 52,916 Legg Mason Partners Variable Portfolios I, Inc. LMPVPI Total Return Subaccount (Class I) (5/98).... 2007 1.306 1.344 -- 2006 1.177 1.306 70,592 2005 1.156 1.177 193,217 2004 1.078 1.156 231,724 2003 0.944 1.078 249,017 2002 1.028 0.944 196,277 2001 1.052 1.028 255,785 2000 0.989 1.052 112,585 1999 0.996 0.989 115,789 1998 1.000 0.996 69,952
A-14 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.45% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- Legg Mason Partners Variable Portfolios III, Inc. LMPVPIII Large Cap Value Subaccount (6/94)......... 2007 2.516 2.646 -- 2006 2.158 2.516 2,488,509 2005 2.056 2.158 3,206,730 2004 1.886 2.056 4,718,730 2003 1.499 1.886 5,636,938 2002 2.040 1.499 6,591,070 2001 2.254 2.040 8,282,092 2000 2.022 2.254 10,588,184 1999 2.050 2.022 13,629,236 1998 1.894 2.050 14,890,673 Met Investors Series Trust MIST Batterymarch Mid-Cap Stock Subaccount (Class A) (4/06).......................................... 2007 1.905 1.991 474,745 2006 1.999 1.905 608,129 MIST BlackRock Large-Cap Core Subaccount (Class A) (4/06)............................................. 2007 1.123 1.178 -- 2006 1.059 1.123 138,532 MIST BlackRock Large-Cap Core Subaccount (Class E) (4/07)............................................. 2007 1.168 1.178 135,323 MIST Lord Abbett Bond Debenture Subaccount (Class A) (4/06).......................................... 2007 1.676 1.765 126,641 2006 1.598 1.676 182,207 MIST Met/AIM Capital Appreciation Subaccount (Class A) (4/06).......................................... 2007 1.467 1.618 2,268,093 2006 1.484 1.467 2,963,465 MIST Pioneer Strategic Income Subaccount (Class A) (4/06)............................................. 2007 1.894 1.990 1,471,686 2006 1.826 1.894 1,824,738 Metropolitan Series Fund, Inc. MSF BlackRock Aggressive Growth Subaccount (Class D) (4/06).......................................... 2007 1.092 1.295 994,816 2006 1.117 1.092 1,248,208 MSF BlackRock Bond Income Subaccount (Class E) (4/06)............................................. 2007 1.614 1.688 750,018 2006 1.554 1.614 833,885 MSF Capital Guardian U.S. Equity Subaccount (Class A) (4/06) *........................................ 2007 2.085 2.053 1,318,902 2006 2.027 2.085 1,708,948 MSF FI Large Cap Subaccount (Class A) (4/06)....... 2007 1.014 1.039 7,964,629 2006 1.000 1.014 10,494,522 MSF MFS(R) Total Return Subaccount (Class F) (4/06)............................................. 2007 2.720 2.793 2,682,648 2006 2.542 2.720 3,728,383
A-15 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.45% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- MSF T. Rowe Price Large Cap Growth Subaccount (Class B) (4/06)................................... 2007 1.070 1.151 47,616 2006 0.998 1.070 38,019 MSF Western Asset Management Strategic Bond Opportunities Subaccount (Class A) (4/06).......... 2007 1.839 1.885 330,747 2006 1.762 1.839 527,125 The Travelers Series Trust Travelers AIM Capital Appreciation Subaccount (10/95)............................................ 2006 1.392 1.484 -- 2005 1.299 1.392 3,477,875 2004 1.238 1.299 4,350,099 2003 0.971 1.238 5,476,460 2002 1.294 0.971 6,512,841 2001 1.723 1.294 9,370,593 2000 1.951 1.723 12,252,599 1999 1.385 1.951 14,474,829 1998 1.198 1.385 15,792,402 Travelers Convertible Securities Subaccount (6/98)............................................. 2006 1.498 1.598 -- 2005 1.515 1.498 213,805 2004 1.446 1.515 225,069 2003 1.162 1.446 200,298 2002 1.267 1.162 302,585 2001 1.297 1.267 314,155 2000 1.169 1.297 141,023 1999 0.999 1.169 181,058 1998 1.000 0.999 24,086 Travelers Disciplined Mid Cap Stock Subaccount (5/98)............................................. 2006 1.829 1.999 -- 2005 1.651 1.829 660,058 2004 1.438 1.651 740,971 2003 1.091 1.438 828,184 2002 1.292 1.091 977,077 2001 1.366 1.292 965,597 2000 1.188 1.366 801,701 1999 1.063 1.188 330,146 1998 1.000 1.063 54,397
A-16 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.45% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- Travelers Managed Income Subaccount (6/94)......... 2006 1.568 1.554 -- 2005 1.569 1.568 995,169 2004 1.548 1.569 1,524,563 2003 1.448 1.548 2,636,504 2002 1.438 1.448 3,344,464 2001 1.367 1.438 3,524,194 2000 1.286 1.367 3,447,356 1999 1.293 1.286 4,233,630 1998 1.248 1.293 3,895,003 Travelers Mercury Large Cap Core Subaccount (5/98)............................................. 2006 0.997 1.059 -- 2005 0.903 0.997 147,003 2004 0.790 0.903 233,259 2003 0.662 0.790 251,631 2002 0.897 0.662 339,786 2001 1.174 0.897 613,613 2000 1.261 1.174 1,310,179 1999 1.035 1.261 1,159,613 1998 1.000 1.035 1,038,696 Travelers MFS(R) Mid Cap Growth Subaccount (2/05).. 2006 1.055 1.117 -- 2005 1.000 1.055 1,598,863 Travelers MFS(R) Total Return Subaccount (6/94).... 2006 2.461 2.542 -- 2005 2.426 2.461 4,753,839 2004 2.208 2.426 6,564,147 2003 1.922 2.208 8,011,019 2002 2.059 1.922 9,194,869 2001 2.089 2.059 10,752,298 2000 1.817 2.089 12,764,698 1999 1.796 1.817 16,859,973 1998 1.632 1.796 18,458,912 Travelers Pioneer Strategic Income Subaccount (6/94)............................................. 2006 1.807 1.826 -- 2005 1.769 1.807 2,511,686 2004 1.618 1.769 3,252,720 2003 1.373 1.618 4,610,898 2002 1.316 1.373 5,513,126 2001 1.281 1.316 6,907,426 2000 1.304 1.281 8,635,386 1999 1.309 1.304 11,060,448 1998 1.319 1.309 12,925,220
A-17 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.45% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- Travelers Salomon Brothers Strategic Total Return Bond Subaccount (6/94)............................. 2006 1.790 1.762 -- 2005 1.774 1.790 716,888 2004 1.694 1.774 777,079 2003 1.516 1.694 1,113,505 2002 1.420 1.516 1,391,400 2001 1.353 1.420 1,096,011 2000 1.299 1.353 1,562,190 1999 1.342 1.299 2,350,837 1998 1.383 1.342 2,624,158 Travelers Strategic Equity Subaccount (6/94)....... 2006 2.403 2.509 -- 2005 2.390 2.403 5,348,116 2004 2.200 2.390 6,967,705 2003 1.684 2.200 8,513,118 2002 2.572 1.684 10,451,939 2001 3.012 2.572 15,076,327 2000 3.737 3.012 20,965,025 1999 2.867 3.737 26,575,989 1998 2.254 2.867 28,709,572 Travelers Van Kampen Enterprise Subaccount (6/94).. 2006 1.951 2.027 -- 2005 1.836 1.951 2,311,440 2004 1.794 1.836 3,136,961 2003 1.449 1.794 4,145,363 2002 2.081 1.449 4,915,422 2001 2.682 2.081 7,087,006 2000 3.188 2.682 9,306,589 1999 2.568 3.188 11,751,851 1998 2.083 2.568 12,560,574
* We are currently waiving a portion of the Mortality and Expense Risk charge for this Subaccount. Please see "Fee Table -- Annual Separate Account Charges" for more information. The date next to each funding option name reflects the date money first came into the funding option through the Separate Account. Funding options not listed above had no amounts allocated to them or were not available as of December 31, 2007. Number of Units Outstanding at the end of the year may include units for Contracts in payout phase. Variable Funding Option mergers and substitutions that occurred between January 1, 2005 and December 31, 2007 are displayed below. Please see Appendix C for more information on Variable Funding Option mergers, substitutions and other changes. Effective on or about 02/25/2005, The Travelers Series Trust-MFS Emerging Growth Portfolio merged into The Travelers Series Trust-MFS Mid Cap Growth Portfolio and is no longer available as a funding option. A-18 Effective on or about 05/01/2006, AIM Variable Insurance Funds-AIM V.I. Premier Equity Fund merged into AIM Variable Insurance Funds-AIM V.I. Core Equity Fund and is no longer available as a funding option. Effective on or about 05/01/2006, AllianceBernstein Variable Products Series Fund, Inc.-AllianceBernstein Large Cap Growth Portfolio was replaced by Metropolitan Series Fund, Inc.-T. Rowe Price Large Cap Growth Portfolio and is no longer available as a funding option. Effective on or about 05/01/2006, The Travelers Series Trust-AIM Capital Appreciation Portfolio merged into Met Investors Series Trust-Met/AIM Capital Appreciation Portfolio and is no longer available as a funding option. Effective on or about 05/01/2006, The Travelers Series Trust-Convertible Securities Portfolio merged into Met Investors Series Trust-Lord Abbett Bond Debenture Portfolio and is no longer available as a funding option. Effective on or about 05/01/2006, The Travelers Series Trust-Disciplined Mid Cap Stock Portfolio merged into Met Investors Series Trust-Batterymarch Mid-Cap Stock Portfolio and is no longer available as a funding option. Effective on or about 05/01/2006, The Travelers Series Trust-Mercury Large Cap Core Portfolio merged into Met Investors Series Trust-Mercury Large-Cap Core Portfolio and is no longer available as a funding option. Effective on or about 05/01/2006, The Travelers Series Trust-MFS Mid Cap Growth Portfolio merged into Metropolitan Series Fund, Inc.-BlackRock Aggressive Growth Portfolio and is no longer available as a funding option. Effective on or about 05/01/2006, The Travelers Series Trust-MFS Total Return Portfolio merged into Metropolitan Series Fund, Inc.-MFS Total Return Portfolio and is no longer available as a funding option. Effective on or about 05/01/2006, The Travelers Series Trust-Pioneer Strategic Income Portfolio merged into Met Investors Series Trust-Pioneer Strategic Income Portfolio and is no longer available as a funding option. Effective on or about 05/01/2006, The Travelers Series Trust-Salomon Brothers Strategic Total Return Bond Portfolio merged into Metropolitan Series Fund, Inc.-Western Asset Management Strategic Bond Opportunities Portfolio and is no longer available as a funding option. Effective on or about 05/01/2006, The Travelers Series Trust-Strategic Equity Portfolio merged into Metropolitan Series Fund, Inc.-FI Large Cap Portfolio and is no longer available as a funding option. Effective on or about 05/01/2006, The Travelers Series Trust-Travelers Managed Income Portfolio merged into Metropolitan Series Fund, Inc.-BlackRock Bond Income Portfolio and is no longer available as a funding option. Effective on or about 05/01/2006, The Travelers Series Trust-Van Kampen Enterprise Portfolio merged into Metropolitan Series Fund, Inc.-Capital Guardian U.S. Equity Portfolio and is no longer available as a funding option. Effective on or about 04/30/2007, AIM Variable Insurance Funds-AIM V.I. Core Equity Fund was replaced by Metropolitan Series Fund, Inc.-Capital Guardian U.S. Equity Portfolio and is no longer available as a funding option. Effective on or about 04/30/2007, Legg Mason Partners Investment Series-Legg Mason Partners Variable Premier Selections All Cap Growth Portfolio merged into Legg Mason Partners Variable Equity Trust-Legg Mason Partners Variable Aggressive Growth Portfolio and is no longer available as a funding option. Effective on or about 04/30/2007, Legg Mason Partners Variable Portfolios V-Legg Mason Partners Variable Small Cap Growth Opportunities Portfolio merged into Legg Mason Partners Variable Equity Trust-Legg Mason Partners Variable Small Cap Growth Portfolio and is no longer available as a funding option. Effective on or about 04/30/2007, Legg Mason Partners Variable Portfolios I, Inc.-Legg Mason Partners Variable Total Return Portfolio merged into Legg Mason Partners Variable Equity Trust-Legg Mason Partners Variable Capital and Income Portfolio and is no longer available as a funding option. Effective on or about 04/30/2007, Legg Mason Partners Variable Portfolios III, Inc.-Legg Mason Partners Variable Large Cap Value Portfolio merged into Legg Mason Partners Variable Equity Trust-Legg Mason Partners Variable Investors Portfolio and is no longer available as a funding option. A-19 Effective on or about 04/30/2007, Met Investors Series Trust-BlackRock Large-Cap Core Portfolio -- Class A was exchanged for Met Investors Series Trust-BlackRock Large-Cap Core Portfolio -- Class E and is no longer available as a funding option. A-20 APPENDIX B -------------------------------------------------------------------------------- CONDENSED FINANCIAL INFORMATION FOR METLIFE OF CT FUND BD II FOR VARIABLE ANNUITIES ACCUMULATION UNIT VALUES (IN DOLLARS) The following Accumulation Unit Value ("AUV") information should be read in conjunction with the Separate Account's audited financial statement and notes, which are included in the Statement of Additional Information ("SAI"). The first table provides the AUV information for the MINIMUM Separate Account Charge available under the contract. The second table provides the AUV information for the MAXIMUM Separate Account Charge available under the contract. Please refer to the Fee Table section of this prospectus for more information on Separate Account Charges. VINTAGE -- SEPARATE ACCOUNT CHARGES 1.17%
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- AIM Variable Insurance Funds AIM V.I. Core Equity Subaccount (Series I) (4/06).. 2007 1.083 1.161 -- 2006 1.000 1.083 57,701 AIM V.I. Premier Equity Subaccount (Series I) (5/01)............................................. 2006 0.825 0.867 -- 2005 0.790 0.825 189,790 2004 0.755 0.790 222,287 2003 0.611 0.755 549,581 2002 0.886 0.611 452,916 2001 1.000 0.886 784,729 AllianceBernstein Variable Products Series Fund, Inc. AllianceBernstein Large-Cap Growth Subaccount (Class B) (5/01)................................... 2006 0.868 0.852 -- 2005 0.764 0.868 440,737 2004 0.714 0.764 552,089 2003 0.585 0.714 541,563 2002 0.857 0.585 591,301 2001 1.000 0.857 1,599,889 American Funds Insurance Series American Funds Global Growth Subaccount (Class 2) (5/01)............................................. 2007 1.487 1.688 3,130,687 2006 1.249 1.487 3,806,585 2005 1.108 1.249 3,590,509 2004 0.988 1.108 3,073,714 2003 0.739 0.988 2,338,416 2002 0.876 0.739 1,531,673 2001 1.000 0.876 302,319
B-1 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.17% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- American Funds Growth Subaccount (Class 2) (5/01).. 2007 1.197 1.329 5,075,493 2006 1.099 1.197 6,276,573 2005 0.957 1.099 7,327,416 2004 0.860 0.957 7,585,044 2003 0.636 0.860 7,876,123 2002 0.852 0.636 5,204,523 2001 1.000 0.852 1,775,006 American Funds Growth-Income Subaccount (Class 2) (5/01)............................................. 2007 1.328 1.378 4,144,457 2006 1.166 1.328 5,795,960 2005 1.115 1.166 7,516,753 2004 1.022 1.115 9,204,918 2003 0.781 1.022 10,455,500 2002 0.967 0.781 8,045,731 2001 1.000 0.967 4,182,477 Dreyfus Variable Investment Fund Dreyfus VIF Developing Leaders Subaccount (Initial Shares) (5/98)..................................... 2007 1.324 1.164 2,047,105 2006 1.291 1.324 2,760,151 2005 1.235 1.291 3,758,077 2004 1.122 1.235 4,881,409 2003 0.862 1.122 6,426,577 2002 1.078 0.862 7,558,046 2001 1.162 1.078 8,367,551 2000 1.038 1.162 8,748,382 1999 0.852 1.038 4,918,004 1998 1.000 0.852 1,712,698 Legg Mason Partners Investment Series LMPIS Premier Selections All Cap Growth Subaccount (5/01)............................................. 2007 0.975 1.040 -- 2006 0.919 0.975 964,406 2005 0.875 0.919 1,212,270 2004 0.860 0.875 1,422,862 2003 0.648 0.860 1,433,743 2002 0.896 0.648 945,291 2001 1.000 0.896 165,628 Legg Mason Partners Variable Equity Trust LMPVET Aggressive Growth Subaccount (Class I) (4/07)............................................. 2007 1.030 0.996 446,293 LMPVET Capital and Income Subaccount (Class I) (4/07)............................................. 2007 1.373 1.383 554,698
B-2 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.17% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- LMPVET Dividend Strategy Subaccount (5/01)......... 2007 0.939 0.988 134,732 2006 0.805 0.939 180,327 2005 0.816 0.805 255,217 2004 0.799 0.816 298,839 2003 0.655 0.799 454,774 2002 0.895 0.655 107,552 2001 1.000 0.895 49,350 LMPVET Equity Index Subaccount (Class II) (5/99)... 2007 1.046 1.084 1,453,402 2006 0.919 1.046 2,076,143 2005 0.892 0.919 2,872,759 2004 0.818 0.892 4,122,866 2003 0.648 0.818 4,934,524 2002 0.845 0.648 5,023,828 2001 0.976 0.845 5,290,969 2000 1.088 0.976 5,833,689 1999 1.000 1.088 4,474,800 LMPVET Fundamental Value Subaccount (Class I) (11/95)............................................ 2007 3.404 3.407 7,206,327 2006 2.948 3.404 10,015,797 2005 2.847 2.948 14,138,557 2004 2.662 2.847 18,731,408 2003 1.942 2.662 23,008,144 2002 2.497 1.942 28,541,086 2001 2.667 2.497 35,936,645 2000 2.240 2.667 39,497,603 1999 1.857 2.240 42,818,333 1998 1.790 1.857 42,829,917 LMPVET International All Cap Opportunity Subaccount (11/95)............................................ 2007 1.642 1.726 7,337,832 2006 1.320 1.642 9,686,634 2005 1.195 1.320 12,878,628 2004 1.026 1.195 16,816,603 2003 0.814 1.026 19,996,518 2002 1.109 0.814 31,080,395 2001 1.630 1.109 37,365,581 2000 2.164 1.630 39,840,894 1999 1.305 2.164 40,313,454 1998 1.240 1.305 38,529,419
B-3 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.17% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- LMPVET Investors Subaccount (Class I) (5/98)....... 2007 1.613 1.656 13,405,767 2006 1.380 1.613 2,359,777 2005 1.310 1.380 3,451,622 2004 1.201 1.310 4,475,846 2003 0.918 1.201 5,788,326 2002 1.207 0.918 7,175,121 2001 1.275 1.207 8,630,494 2000 1.119 1.275 3,800,664 1999 1.014 1.119 2,903,384 1998 1.000 1.014 1,024,070 LMPVET Large Cap Growth Subaccount (Class I) (5/98)............................................. 2007 1.471 1.531 7,873,924 2006 1.423 1.471 11,094,038 2005 1.368 1.423 17,888,406 2004 1.379 1.368 24,244,756 2003 0.945 1.379 29,762,936 2002 1.272 0.945 32,882,101 2001 1.471 1.272 41,629,754 2000 1.599 1.471 48,151,480 1999 1.237 1.599 46,287,883 1998 1.000 1.237 12,176,408 LMPVET Lifestyle Allocation 50% Subaccount (3/97).. 2007 1.609 1.642 1,922,251 2006 1.505 1.609 2,944,515 2005 1.485 1.505 3,657,695 2004 1.396 1.485 4,780,579 2003 1.174 1.396 6,058,621 2002 1.270 1.174 7,016,157 2001 1.303 1.270 8,521,339 2000 1.258 1.303 7,372,296 1999 1.183 1.258 8,078,329 1998 1.093 1.183 7,215,935 LMPVET Lifestyle Allocation 70% Subaccount (3/97).. 2007 1.483 1.522 1,065,372 2006 1.378 1.483 1,443,610 2005 1.331 1.378 1,803,712 2004 1.239 1.331 2,108,022 2003 0.965 1.239 2,810,456 2002 1.192 0.965 3,477,779 2001 1.338 1.192 4,058,208 2000 1.421 1.338 4,479,543 1999 1.238 1.421 5,037,394 1998 1.099 1.238 5,355,940
B-4 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.17% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- LMPVET Lifestyle Allocation 85% Subaccount (3/97).. 2007 1.570 1.604 440,074 2006 1.451 1.570 545,430 2005 1.384 1.451 563,661 2004 1.266 1.384 641,406 2003 0.936 1.266 1,063,284 2002 1.242 0.936 2,145,452 2001 1.429 1.242 2,532,075 2000 1.558 1.429 2,672,371 1999 1.242 1.558 2,931,329 1998 1.090 1.242 3,434,814 LMPVET Small Cap Growth Subaccount (Class I) (4/07)............................................. 2007 1.356 1.400 419,593 Legg Mason Partners Variable Income Trust LMPVIT High Income Subaccount (11/95).............. 2007 1.863 1.847 3,809,667 2006 1.699 1.863 4,850,880 2005 1.675 1.699 6,545,929 2004 1.534 1.675 10,157,755 2003 1.217 1.534 14,004,456 2002 1.273 1.217 17,052,242 2001 1.338 1.273 22,082,482 2000 1.472 1.338 25,994,496 1999 1.452 1.472 30,633,089 1998 1.463 1.452 31,054,135 LMPVIT Money Market Subaccount (11/95)............. 2007 1.374 1.425 3,840,951 2006 1.329 1.374 5,687,571 2005 1.308 1.329 7,790,651 2004 1.311 1.308 12,688,242 2003 1.318 1.311 24,151,440 2002 1.317 1.318 45,287,737 2001 1.285 1.317 49,324,087 2000 1.226 1.285 45,585,702 1999 1.184 1.226 48,631,112 1998 1.140 1.184 41,370,187 Legg Mason Partners Variable Portfolios V LMPVPV Small Cap Growth Opportunities Subaccount (Class I) (6/01)................................... 2007 1.290 1.379 -- 2006 1.156 1.290 527,869 2005 1.115 1.156 810,421 2004 0.976 1.115 1,045,618 2003 0.696 0.976 1,327,911 2002 0.947 0.696 565,103 2001 1.000 0.947 471,861
B-5 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.17% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- Legg Mason Partners Variable Portfolios I, Inc. LMPVPI Total Return Subaccount (Class I) (5/98).... 2007 1.338 1.378 -- 2006 1.203 1.338 689,822 2005 1.178 1.203 900,666 2004 1.096 1.178 1,229,680 2003 0.956 1.096 1,568,694 2002 1.039 0.956 1,661,014 2001 1.060 1.039 1,775,865 2000 0.994 1.060 1,806,836 1999 0.997 0.994 1,619,636 1998 1.000 0.997 761,112 Legg Mason Partners Variable Portfolios III, Inc. LMPVPIII Large Cap Value Subaccount (11/95)........ 2007 2.606 2.743 -- 2006 2.229 2.606 9,474,803 2005 2.118 2.229 12,966,895 2004 1.937 2.118 18,635,245 2003 1.536 1.937 23,230,901 2002 2.083 1.536 28,614,647 2001 2.296 2.083 36,896,310 2000 2.053 2.296 41,043,900 1999 2.076 2.053 45,773,195 1998 1.913 2.076 40,967,323 Met Investors Series Trust MIST Batterymarch Mid-Cap Stock Subaccount (Class A) (4/06).......................................... 2007 1.952 2.046 2,082,710 2006 2.044 1.952 2,768,458 MIST BlackRock Large-Cap Core Subaccount (Class A) (4/06)............................................. 2007 1.150 1.208 -- 2006 1.083 1.150 1,997,711 MIST BlackRock Large-Cap Core Subaccount (Class E) (4/07)............................................. 2007 1.198 1.210 1,165,690 MIST Lord Abbett Bond Debenture Subaccount (Class A) (4/06).......................................... 2007 1.717 1.813 605,551 2006 1.634 1.717 767,267 MIST Met/AIM Capital Appreciation Subaccount (Class A) (4/06).......................................... 2007 1.514 1.674 9,668,175 2006 1.528 1.514 12,726,112 MIST Pioneer Strategic Income Subaccount (Class A) (4/06)............................................. 2007 1.961 2.067 5,449,294 2006 1.888 1.961 6,817,803 Metropolitan Series Fund, Inc. MSF BlackRock Aggressive Growth Subaccount (Class D) (4/06).......................................... 2007 1.097 1.306 7,090,827 2006 1.121 1.097 9,500,259
B-6 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.17% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- MSF BlackRock Bond Income Subaccount (Class E) (4/06)............................................. 2007 1.672 1.753 3,035,145 2006 1.606 1.672 3,842,867 MSF Capital Guardian U.S. Equity Subaccount (Class A) (4/06) *........................................ 2007 2.160 2.133 5,931,008 2006 2.095 2.160 7,894,525 MSF FI Large Cap Subaccount (Class A) (4/06)....... 2007 1.016 1.044 30,416,839 2006 1.000 1.016 40,133,159 MSF MFS(R) Total Return Subaccount (Class F) (4/06)............................................. 2007 2.817 2.900 11,404,193 2006 2.628 2.817 15,128,976 MSF T. Rowe Price Large Cap Growth Subaccount (Class B) (4/06)................................... 2007 1.072 1.156 263,651 2006 0.998 1.072 382,186 MSF Western Asset Management Strategic Bond Opportunities Subaccount (Class A) (4/06).......... 2007 1.905 1.958 1,271,854 2006 1.822 1.905 1,585,549 The Travelers Series Trust Travelers AIM Capital Appreciation Subaccount (11/95)............................................ 2006 1.433 1.528 -- 2005 1.333 1.433 17,196,167 2004 1.267 1.333 23,560,997 2003 0.991 1.267 29,554,141 2002 1.317 0.991 36,609,088 2001 1.748 1.317 48,759,536 2000 1.974 1.748 58,458,248 1999 1.397 1.974 59,794,915 1998 1.206 1.397 59,823,732 Travelers Convertible Securities Subaccount (5/98)............................................. 2006 1.531 1.634 -- 2005 1.543 1.531 1,894,620 2004 1.469 1.543 2,910,835 2003 1.177 1.469 3,580,128 2002 1.280 1.177 2,836,081 2001 1.306 1.280 3,229,548 2000 1.175 1.306 2,705,832 1999 1.001 1.175 1,597,497 1998 1.000 1.001 418,194
B-7 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.17% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- Travelers Disciplined Mid Cap Stock Subaccount (5/98)............................................. 2006 1.869 2.044 -- 2005 1.682 1.869 3,877,461 2004 1.461 1.682 5,322,574 2003 1.105 1.461 6,731,651 2002 1.305 1.105 7,539,227 2001 1.376 1.305 7,464,051 2000 1.194 1.376 7,288,284 1999 1.064 1.194 3,984,156 1998 1.000 1.064 550,487 Travelers Managed Income Subaccount (11/95)........ 2006 1.619 1.606 -- 2005 1.616 1.619 5,893,607 2004 1.590 1.616 8,132,897 2003 1.483 1.590 11,247,672 2002 1.469 1.483 15,554,389 2001 1.392 1.469 18,765,083 2000 1.306 1.392 18,462,379 1999 1.309 1.306 20,425,251 1998 1.261 1.309 11,544,261 Travelers Mercury Large Cap Core Subaccount (5/98)............................................. 2006 1.019 1.083 -- 2005 0.920 1.019 2,908,628 2004 0.803 0.920 3,507,945 2003 0.671 0.803 4,011,608 2002 0.906 0.671 5,179,705 2001 1.183 0.906 7,294,912 2000 1.267 1.183 8,594,088 1999 1.037 1.267 7,720,777 1998 1.000 1.037 3,295,301 Travelers MFS(R) Mid Cap Growth Subaccount (2/05).. 2006 1.058 1.121 -- 2005 1.000 1.058 13,281,410 Travelers MFS(R) Total Return Subaccount (11/95)... 2006 2.542 2.628 -- 2005 2.498 2.542 21,052,598 2004 2.268 2.498 28,712,973 2003 1.969 2.268 36,279,044 2002 2.103 1.969 44,055,402 2001 2.127 2.103 51,925,016 2000 1.845 2.127 55,043,368 1999 1.819 1.845 64,327,238 1998 1.648 1.819 58,653,278
B-8 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.17% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- Travelers Pioneer Strategic Income Subaccount (11/95)............................................ 2006 1.867 1.888 -- 2005 1.822 1.867 9,739,686 2004 1.661 1.822 12,908,237 2003 1.406 1.661 17,359,087 2002 1.344 1.406 20,779,858 2001 1.304 1.344 24,095,134 2000 1.325 1.304 27,997,652 1999 1.326 1.325 31,303,028 1998 1.332 1.326 29,566,111 Travelers Salomon Brothers Strategic Total Return Bond Subaccount (11/95)............................ 2006 1.848 1.822 -- 2005 1.827 1.848 2,185,732 2004 1.739 1.827 3,246,313 2003 1.553 1.739 4,620,468 2002 1.450 1.553 6,048,142 2001 1.378 1.450 5,041,930 2000 1.319 1.378 4,408,007 1999 1.359 1.319 5,149,182 1998 1.397 1.359 5,481,141 Travelers Strategic Equity Subaccount (11/95)...... 2006 2.482 2.594 -- 2005 2.461 2.482 20,922,781 2004 2.259 2.461 28,494,540 2003 1.724 2.259 35,580,777 2002 2.627 1.724 43,888,761 2001 3.068 2.627 61,361,661 2000 3.795 3.068 72,884,231 1999 2.903 3.795 76,734,335 1998 2.276 2.903 67,639,943 Travelers Van Kampen Enterprise Subaccount (11/95)............................................ 2006 2.015 2.095 -- 2005 1.891 2.015 10,614,331 2004 1.842 1.891 14,731,756 2003 1.484 1.842 18,474,416 2002 2.125 1.484 22,699,674 2001 2.731 2.125 30,008,237 2000 3.238 2.731 37,059,764 1999 2.601 3.238 39,297,380 1998 2.103 2.601 35,643,545
B-9 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.45%
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- AIM Variable Insurance Funds AIM V.I. Core Equity Subaccount (Series I) (4/06).. 2007 1.081 1.158 -- 2006 1.000 1.081 -- AIM V.I. Premier Equity Subaccount (Series I) (5/01)............................................. 2006 0.814 0.855 -- 2005 0.782 0.814 4,668 2004 0.750 0.782 5,619 2003 0.608 0.750 6,618 2002 0.885 0.608 -- 2001 1.000 0.885 2,179 AllianceBernstein Variable Products Series Fund, Inc. AllianceBernstein Large-Cap Growth Subaccount (Class B) (5/01)................................... 2006 0.856 0.839 -- 2005 0.757 0.856 -- 2004 0.709 0.757 -- 2003 0.583 0.709 2,909 2002 0.855 0.583 8,838 2001 1.000 0.855 234,311 American Funds Insurance Series American Funds Global Growth Subaccount (Class 2) (5/01)............................................. 2007 1.463 1.656 574,682 2006 1.233 1.463 666,217 2005 1.097 1.233 502,635 2004 0.980 1.097 521,068 2003 0.735 0.980 469,609 2002 0.874 0.735 326,225 2001 1.000 0.874 78,492 American Funds Growth Subaccount (Class 2) (5/01).. 2007 1.178 1.304 1,684,723 2006 1.084 1.178 2,201,349 2005 0.947 1.084 2,439,803 2004 0.854 0.947 2,269,374 2003 0.633 0.854 1,931,622 2002 0.850 0.633 1,310,595 2001 1.000 0.850 438,782 American Funds Growth-Income Subaccount (Class 2) (5/01)............................................. 2007 1.307 1.353 1,431,221 2006 1.151 1.307 1,713,136 2005 1.103 1.151 1,938,260 2004 1.014 1.103 2,183,878 2003 0.777 1.014 1,786,396 2002 0.965 0.777 1,645,336 2001 1.000 0.965 719,119
B-10 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.45% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- Dreyfus Variable Investment Fund Dreyfus VIF Developing Leaders Subaccount (Initial Shares) (5/98)..................................... 2007 1.292 1.133 283,431 2006 1.264 1.292 624,900 2005 1.212 1.264 814,148 2004 1.104 1.212 919,115 2003 0.851 1.104 1,032,557 2002 1.067 0.851 963,891 2001 1.153 1.067 739,152 2000 1.033 1.153 804,861 1999 0.851 1.033 449,652 1998 1.000 0.851 252,461 Legg Mason Partners Investment Series LMPIS Premier Selections All Cap Growth Subaccount (5/01)............................................. 2007 0.960 1.022 -- 2006 0.907 0.960 182,469 2005 0.866 0.907 317,230 2004 0.854 0.866 378,955 2003 0.645 0.854 359,910 2002 0.894 0.645 506,203 2001 1.000 0.894 80,062 Legg Mason Partners Variable Equity Trust LMPVET Aggressive Growth Subaccount (Class I) (4/07)............................................. 2007 1.013 0.978 157,635 LMPVET Capital and Income Subaccount (Class I) (4/07)............................................. 2007 1.338 1.346 244,844 LMPVET Dividend Strategy Subaccount (5/01)......... 2007 0.924 0.969 47,493 2006 0.795 0.924 41,122 2005 0.808 0.795 58,562 2004 0.793 0.808 87,461 2003 0.652 0.793 88,642 2002 0.893 0.652 26,571 2001 1.000 0.893 10,809 LMPVET Equity Index Subaccount (Class II) (5/99)... 2007 1.023 1.058 232,235 2006 0.902 1.023 309,979 2005 0.878 0.902 329,523 2004 0.808 0.878 301,119 2003 0.642 0.808 357,783 2002 0.839 0.642 367,027 2001 0.971 0.839 98,319 2000 1.086 0.971 88,601 1999 1.000 1.086 157,335
B-11 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.45% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- LMPVET Fundamental Value Subaccount (Class I) (11/95)............................................ 2007 3.290 3.284 2,282,728 2006 2.858 3.290 3,392,121 2005 2.767 2.858 4,145,278 2004 2.595 2.767 5,059,922 2003 1.899 2.595 5,716,998 2002 2.448 1.899 6,612,767 2001 2.622 2.448 7,518,471 2000 2.208 2.622 7,852,821 1999 1.836 2.208 8,588,178 1998 1.775 1.836 9,424,781 LMPVET International All Cap Opportunity Subaccount (11/95)............................................ 2007 1.585 1.661 2,063,260 2006 1.278 1.585 2,430,095 2005 1.161 1.278 2,745,473 2004 0.999 1.161 3,021,620 2003 0.795 0.999 3,711,209 2002 1.086 0.795 4,109,540 2001 1.601 1.086 5,041,565 2000 2.131 1.601 5,396,144 1999 1.289 2.131 5,906,915 1998 1.228 1.289 6,198,702 LMPVET Investors Subaccount (Class I) (5/98)....... 2007 1.574 1.612 3,869,507 2006 1.350 1.574 779,003 2005 1.286 1.350 920,412 2004 1.182 1.286 964,242 2003 0.906 1.182 1,037,658 2002 1.195 0.906 1,141,039 2001 1.265 1.195 1,342,374 2000 1.114 1.265 858,755 1999 1.012 1.114 529,114 1998 1.000 1.012 199,078 LMPVET Large Cap Growth Subaccount (Class I) (5/98)............................................. 2007 1.435 1.490 1,509,528 2006 1.392 1.435 1,953,901 2005 1.343 1.392 2,350,632 2004 1.357 1.343 2,809,530 2003 0.933 1.357 3,173,664 2002 1.259 0.933 3,026,159 2001 1.460 1.259 3,755,140 2000 1.592 1.460 4,219,549 1999 1.234 1.592 3,491,177 1998 1.000 1.234 1,447,309
B-12 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.45% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- LMPVET Lifestyle Allocation 50% Subaccount (3/97).. 2007 1.566 1.593 818,571 2006 1.468 1.566 1,021,362 2005 1.453 1.468 1,131,824 2004 1.370 1.453 1,499,876 2003 1.155 1.370 1,614,838 2002 1.253 1.155 1,984,327 2001 1.290 1.253 2,337,583 2000 1.248 1.290 2,325,059 1999 1.177 1.248 2,374,648 1998 1.091 1.177 2,594,418 LMPVET Lifestyle Allocation 70% Subaccount (3/97).. 2007 1.443 1.476 920,144 2006 1.345 1.443 1,055,184 2005 1.302 1.345 1,086,138 2004 1.216 1.302 1,155,771 2003 0.950 1.216 1,298,046 2002 1.176 0.950 1,312,996 2001 1.323 1.176 1,443,925 2000 1.410 1.323 1,580,482 1999 1.232 1.410 2,157,254 1998 1.097 1.232 2,329,431 LMPVET Lifestyle Allocation 85% Subaccount (3/97).. 2007 1.527 1.556 37,982 2006 1.416 1.527 37,982 2005 1.354 1.416 49,939 2004 1.242 1.354 113,957 2003 0.921 1.242 117,971 2002 1.225 0.921 107,009 2001 1.414 1.225 389,634 2000 1.546 1.414 403,429 1999 1.236 1.546 447,062 1998 1.087 1.236 622,357 LMPVET Small Cap Growth Subaccount (Class I) (4/07)............................................. 2007 1.333 1.375 159,664
B-13 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.45% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- Legg Mason Partners Variable Income Trust LMPVIT High Income Subaccount (11/95).............. 2007 1.799 1.778 922,760 2006 1.645 1.799 1,160,973 2005 1.626 1.645 1,535,138 2004 1.494 1.626 2,066,353 2003 1.189 1.494 2,608,457 2002 1.246 1.189 2,717,395 2001 1.314 1.246 3,063,554 2000 1.450 1.314 3,605,109 1999 1.434 1.450 4,266,126 1998 1.448 1.434 4,739,592 LMPVIT Money Market Subaccount (11/95)............. 2007 1.327 1.372 1,725,271 2006 1.286 1.327 1,363,733 2005 1.270 1.286 1,550,993 2004 1.277 1.270 2,442,193 2003 1.287 1.277 3,608,001 2002 1.289 1.287 4,582,342 2001 1.262 1.289 4,926,672 2000 1.207 1.262 3,371,813 1999 1.169 1.207 5,840,571 1998 1.129 1.169 6,023,674 Legg Mason Partners Variable Portfolios V LMPVPV Small Cap Growth Opportunities Subaccount (Class I) (6/01)................................... 2007 1.270 1.356 -- 2006 1.141 1.270 159,130 2005 1.104 1.141 111,823 2004 0.969 1.104 118,451 2003 0.692 0.969 64,522 2002 0.945 0.692 45,580 2001 1.000 0.945 8,130 Legg Mason Partners Variable Portfolios I, Inc. LMPVPI Total Return Subaccount (Class I) (5/98).... 2007 1.306 1.344 -- 2006 1.177 1.306 293,977 2005 1.156 1.177 354,387 2004 1.078 1.156 393,577 2003 0.944 1.078 423,845 2002 1.028 0.944 461,333 2001 1.052 1.028 241,087 2000 0.989 1.052 214,225 1999 0.996 0.989 208,331 1998 1.000 0.996 127,726
B-14 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.45% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- Legg Mason Partners Variable Portfolios III, Inc. LMPVPIII Large Cap Value Subaccount (11/95)........ 2007 2.516 2.646 -- 2006 2.158 2.516 2,643,979 2005 2.056 2.158 3,231,996 2004 1.886 2.056 3,761,665 2003 1.499 1.886 4,212,320 2002 2.040 1.499 5,136,381 2001 2.254 2.040 6,460,230 2000 2.022 2.254 7,279,633 1999 2.050 2.022 8,114,092 1998 1.894 2.050 8,248,925 Met Investors Series Trust MIST Batterymarch Mid-Cap Stock Subaccount (Class A) (4/06).......................................... 2007 1.905 1.991 355,249 2006 1.999 1.905 615,544 MIST BlackRock Large-Cap Core Subaccount (Class A) (4/06)............................................. 2007 1.123 1.178 -- 2006 1.059 1.123 718,347 MIST BlackRock Large-Cap Core Subaccount (Class E) (4/07)............................................. 2007 1.168 1.178 650,495 MIST Lord Abbett Bond Debenture Subaccount (Class A) (4/06).......................................... 2007 1.676 1.765 161,539 2006 1.598 1.676 309,596 MIST Met/AIM Capital Appreciation Subaccount (Class A) (4/06).......................................... 2007 1.467 1.618 2,814,225 2006 1.484 1.467 3,487,590 MIST Pioneer Strategic Income Subaccount (Class A) (4/06)............................................. 2007 1.894 1.990 1,319,506 2006 1.826 1.894 1,836,968 Metropolitan Series Fund, Inc. MSF BlackRock Aggressive Growth Subaccount (Class D) (4/06).......................................... 2007 1.092 1.295 2,302,225 2006 1.117 1.092 2,798,096 MSF BlackRock Bond Income Subaccount (Class E) (4/06)............................................. 2007 1.614 1.688 881,899 2006 1.554 1.614 1,469,856 MSF Capital Guardian U.S. Equity Subaccount (Class A) (4/06) *........................................ 2007 2.085 2.053 1,541,384 2006 2.027 2.085 1,958,832 MSF FI Large Cap Subaccount (Class A) (4/06)....... 2007 1.014 1.039 7,823,573 2006 1.000 1.014 10,079,751 MSF MFS(R) Total Return Subaccount (Class F) (4/06)............................................. 2007 2.720 2.793 3,148,575 2006 2.542 2.720 3,953,852
B-15 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.45% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- MSF T. Rowe Price Large Cap Growth Subaccount (Class B) (4/06)................................... 2007 1.070 1.151 29,991 2006 0.998 1.070 40,789 MSF Western Asset Management Strategic Bond Opportunities Subaccount (Class A) (4/06).......... 2007 1.839 1.885 251,415 2006 1.762 1.839 368,821 The Travelers Series Trust Travelers AIM Capital Appreciation Subaccount (11/95)............................................ 2006 1.392 1.484 -- 2005 1.299 1.392 4,421,097 2004 1.238 1.299 5,178,947 2003 0.971 1.238 6,091,107 2002 1.294 0.971 7,425,616 2001 1.723 1.294 9,242,361 2000 1.951 1.723 10,759,671 1999 1.385 1.951 10,757,693 1998 1.198 1.385 11,522,469 Travelers Convertible Securities Subaccount (5/98)............................................. 2006 1.498 1.598 -- 2005 1.515 1.498 299,120 2004 1.446 1.515 325,676 2003 1.162 1.446 399,307 2002 1.267 1.162 418,382 2001 1.297 1.267 293,689 2000 1.169 1.297 425,068 1999 0.999 1.169 429,444 1998 1.000 0.999 22,352 Travelers Disciplined Mid Cap Stock Subaccount (5/98)............................................. 2006 1.829 1.999 -- 2005 1.651 1.829 749,382 2004 1.438 1.651 939,042 2003 1.091 1.438 1,049,421 2002 1.292 1.091 1,005,471 2001 1.366 1.292 856,513 2000 1.188 1.366 833,708 1999 1.063 1.188 256,491 1998 1.000 1.063 28,077
B-16 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.45% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- Travelers Managed Income Subaccount (11/95)........ 2006 1.568 1.554 -- 2005 1.569 1.568 1,935,772 2004 1.548 1.569 2,072,462 2003 1.448 1.548 2,400,924 2002 1.438 1.448 2,934,020 2001 1.367 1.438 3,093,511 2000 1.286 1.367 2,585,253 1999 1.293 1.286 2,551,368 1998 1.248 1.293 2,823,113 Travelers Mercury Large Cap Core Subaccount (5/98)............................................. 2006 0.997 1.059 -- 2005 0.903 0.997 829,347 2004 0.790 0.903 901,192 2003 0.662 0.790 1,017,738 2002 0.897 0.662 1,168,058 2001 1.174 0.897 1,505,832 2000 1.261 1.174 1,788,003 1999 1.035 1.261 1,494,593 1998 1.000 1.035 1,243,396 Travelers MFS(R) Mid Cap Growth Subaccount (2/05).. 2006 1.055 1.117 -- 2005 1.000 1.055 3,622,482 Travelers MFS(R) Total Return Subaccount (11/95)... 2006 2.461 2.542 -- 2005 2.426 2.461 5,062,739 2004 2.208 2.426 5,979,649 2003 1.922 2.208 7,337,522 2002 2.059 1.922 8,750,063 2001 2.089 2.059 9,333,303 2000 1.817 2.089 10,057,270 1999 1.796 1.817 11,574,413 1998 1.632 1.796 11,645,845 Travelers Pioneer Strategic Income Subaccount (11/95)............................................ 2006 1.807 1.826 -- 2005 1.769 1.807 2,288,255 2004 1.618 1.769 2,775,587 2003 1.373 1.618 3,349,980 2002 1.316 1.373 4,163,745 2001 1.281 1.316 4,654,411 2000 1.304 1.281 5,666,775 1999 1.309 1.304 7,148,635 1998 1.319 1.309 7,312,474
B-17 VINTAGE -- SEPARATE ACCOUNT CHARGES 1.45% (CONTINUED)
UNIT VALUE AT NUMBER OF UNITS BEGINNING OF UNIT VALUE AT OUTSTANDING AT PORTFOLIO NAME YEAR YEAR END OF YEAR END OF YEAR -------------- ---- ------------- ------------- --------------- Travelers Salomon Brothers Strategic Total Return Bond Subaccount (11/95)............................ 2006 1.790 1.762 -- 2005 1.774 1.790 573,409 2004 1.694 1.774 644,955 2003 1.516 1.694 842,127 2002 1.420 1.516 946,999 2001 1.353 1.420 659,392 2000 1.299 1.353 733,479 1999 1.342 1.299 849,705 1998 1.383 1.342 973,254 Travelers Strategic Equity Subaccount (11/95)...... 2006 2.403 2.509 -- 2005 2.390 2.403 5,000,743 2004 2.200 2.390 5,922,162 2003 1.684 2.200 7,124,931 2002 2.572 1.684 8,423,446 2001 3.012 2.572 10,948,574 2000 3.737 3.012 12,646,207 1999 2.867 3.737 13,423,385 1998 2.254 2.867 13,083,045 Travelers Van Kampen Enterprise Subaccount (11/95)............................................ 2006 1.951 2.027 -- 2005 1.836 1.951 2,627,676 2004 1.794 1.836 3,074,771 2003 1.449 1.794 3,635,892 2002 2.081 1.449 4,362,576 2001 2.682 2.081 5,412,388 2000 3.188 2.682 6,225,353 1999 2.568 3.188 6,615,143 1998 2.083 2.568 6,741,005
* We are currently waiving a portion of the Mortality and Expense Risk charge for this Subaccount. Please see "Fee Table -- Annual Separate Account Charges" for more information. The date next to each funding option name reflects the date money first came into the funding option through the Separate Account. Funding options not listed above had no amounts allocated to them or were not available as of December 31, 2007. Number of Units Outstanding at the end of the year may include units for Contracts in payout phase. Variable Funding Option mergers and substitutions that occurred between January 1, 2005 and December 31, 2007 are displayed below. Please see Appendix C for more information on Variable Funding Option mergers, substitutions and other changes. Effective on or about 02/25/2005, The Travelers Series Trust-MFS Emerging Growth Portfolio merged into The Travelers Series Trust-MFS Mid Cap Growth Portfolio and is no longer available as a funding option. B-18 Effective on or about 05/01/2006, AIM Variable Insurance Funds-AIM V.I. Premier Equity Fund merged into AIM Variable Insurance Funds-AIM V.I. Core Equity Fund and is no longer available as a funding option. Effective on or about 05/01/2006, AllianceBernstein Variable Products Series Fund, Inc.-AllianceBernstein Large Cap Growth Portfolio was replaced by Metropolitan Series Fund, Inc.-T. Rowe Price Large Cap Growth Portfolio and is no longer available as a funding option. Effective on or about 05/01/2006, The Travelers Series Trust-AIM Capital Appreciation Portfolio merged into Met Investors Series Trust-Met/AIM Capital Appreciation Portfolio and is no longer available as a funding option. Effective on or about 05/01/2006, The Travelers Series Trust-Convertible Securities Portfolio merged into Met Investors Series Trust-Lord Abbett Bond Debenture Portfolio and is no longer available as a funding option. Effective on or about 05/01/2006, The Travelers Series Trust-Disciplined Mid Cap Stock Portfolio merged into Met Investors Series Trust-Batterymarch Mid-Cap Stock Portfolio and is no longer available as a funding option. Effective on or about 05/01/2006, The Travelers Series Trust-Mercury Large Cap Core Portfolio merged into Met Investors Series Trust-Mercury Large-Cap Core Portfolio and is no longer available as a funding option. Effective on or about 05/01/2006, The Travelers Series Trust-MFS Mid Cap Growth Portfolio merged into Metropolitan Series Fund, Inc.-BlackRock Aggressive Growth Portfolio and is no longer available as a funding option. Effective on or about 05/01/2006, The Travelers Series Trust-MFS Total Return Portfolio merged into Metropolitan Series Fund, Inc.-MFS Total Return Portfolio and is no longer available as a funding option. Effective on or about 05/01/2006, The Travelers Series Trust-Pioneer Strategic Income Portfolio merged into Met Investors Series Trust-Pioneer Strategic Income Portfolio and is no longer available as a funding option. Effective on or about 05/01/2006, The Travelers Series Trust-Salomon Brothers Strategic Total Return Bond Portfolio merged into Metropolitan Series Fund, Inc.-Western Asset Management Strategic Bond Opportunities Portfolio and is no longer available as a funding option. Effective on or about 05/01/2006, The Travelers Series Trust-Strategic Equity Portfolio merged into Metropolitan Series Fund, Inc.-FI Large Cap Portfolio and is no longer available as a funding option. Effective on or about 05/01/2006, The Travelers Series Trust-Travelers Managed Income Portfolio merged into Metropolitan Series Fund, Inc.-BlackRock Bond Income Portfolio and is no longer available as a funding option. Effective on or about 05/01/2006, The Travelers Series Trust-Van Kampen Enterprise Portfolio merged into Metropolitan Series Fund, Inc.-Capital Guardian U.S. Equity Portfolio and is no longer available as a funding option. Effective on or about 04/30/2007, AIM Variable Insurance Funds-AIM V.I. Core Equity Fund was replaced by Metropolitan Series Fund, Inc.-Capital Guardian U.S. Equity Portfolio and is no longer available as a funding option. Effective on or about 04/30/2007, Legg Mason Partners Investment Series-Legg Mason Partners Variable Premier Selections All Cap Growth Portfolio merged into Legg Mason Partners Variable Equity Trust-Legg Mason Partners Variable Aggressive Growth Portfolio and is no longer available as a funding option. Effective on or about 04/30/2007, Legg Mason Partners Variable Portfolios V-Legg Mason Partners Variable Small Cap Growth Opportunities Portfolio merged into Legg Mason Partners Variable Equity Trust-Legg Mason Partners Variable Small Cap Growth Portfolio and is no longer available as a funding option. Effective on or about 04/30/2007, Legg Mason Partners Variable Portfolios I, Inc.-Legg Mason Partners Variable Total Return Portfolio merged into Legg Mason Partners Variable Equity Trust-Legg Mason Partners Variable Capital and Income Portfolio and is no longer available as a funding option. Effective on or about 04/30/2007, Legg Mason Partners Variable Portfolios III, Inc.-Legg Mason Partners Variable Large Cap Value Portfolio merged into Legg Mason Partners Variable Equity Trust-Legg Mason Partners Variable Investors Portfolio and is no longer available as a funding option. B-19 Effective on or about 04/30/2007, Met Investors Series Trust-BlackRock Large-Cap Core Portfolio -- Class A was exchanged for Met Investors Series Trust-BlackRock Large-Cap Core Portfolio -- Class E and is no longer available as a funding option. B-20 APPENDIX C -------------------------------------------------------------------------------- ADDITIONAL INFORMATION REGARDING UNDERLYING FUNDS Certain Underlying Funds were subject to a merger, substitution or other change. The chart below identifies the former name and new name of each of these Underlying Funds. UNDERLYING FUND MERGERS The following former Underlying Funds were merged with and into the new Underlying Funds.
FORMER UNDERLYING FUND NEW UNDERLYING FUND/ --------------------------------------------- --------------------------------------------- MET INVESTORS SERIES TRUST MET INVESTORS SERIES TRUST Batterymarch Mid-Cap Stock Lazard Mid Cap Portfolio -- Class A Portfolio -- Class A
UNDERLYING FUND SUBSTITUTIONS The following new Underlying Funds were substituted for the former Underlying Funds.
FORMER UNDERLYING FUND NEW UNDERLYING FUND --------------------------------------------- --------------------------------------------- DREYFUS VARIABLE INVESTMENT FUND METROPOLITAN SERIES FUND, INC. Developing Leaders Portfolio -- Initial T. Rowe Price Small Cap Growth Shares Portfolio -- Class B
C-1 THIS PAGE INTENTIONALLY LEFT BLANK. APPENDIX D -------------------------------------------------------------------------------- THE FIXED ACCOUNT The Fixed Account is part of the Company's general account assets. These general account assets include all assets of the Company other than those held in the Separate Accounts sponsored by the Company or its affiliates. The staff of the SEC does not generally review the disclosure in the prospectus relating to the Fixed Account. Disclosure regarding the Fixed Account and the general account may, however, be subject to certain provisions of the federal securities laws relating to the accuracy and completeness of statements made in the prospectus. Under the Fixed Account, the Company assumes the risk of investment gain or loss, guarantees a specified interest rate, and guarantees a specified periodic Annuity Payment. The investment gain or loss of the Separate Account or any of the funding options does not affect the Fixed Account Contract Value, or the dollar amount of fixed Annuity Payments made under any payout option. We guarantee that, at any time, the Fixed Account Contract Value will not be less than the amount of the Purchase Payments allocated to the Fixed Account, plus interest credited as described below, less any applicable premium taxes or prior withdrawals. Purchase Payments allocated to the Fixed Account and any transfers made to the Fixed Account become part of the Company's general account, which supports insurance and annuity obligations. Where permitted by state law, we reserve the right to restrict Purchase Payments into the Fixed Account whenever the credited interest rate on the Fixed Account is equal to the minimum guaranteed interest rate specified in your Contract. The general account and any interest therein are not registered under, or subject to the provisions of, the Securities Act of 1933 or Investment Company Act of 1940. We will invest the assets of the Fixed Account at our discretion. Investment income from such Fixed Account assets will be allocated to us and to the Contracts participating in the Fixed Account. Investment income from the Fixed Account allocated to us includes compensation for mortality and expense risks borne by us in connection with Fixed Account Contracts. The amount of such investment income allocated to the Contracts will vary from year to year in our sole discretion at such rate or rates as we prospectively declare from time to time. We guarantee the initial rate for any allocations into the Fixed Account for one year from the date of such allocation. We guarantee subsequent renewal rates for the calendar quarter. We also guarantee that for the life of the Contract we will credit interest at a rate not less than the minimum interest rate allowed by state law. We reserve the right to change the rate subject to applicable state law. We will determine any interest we credit to amounts allocated to the Fixed Account in excess of the minimum guaranteed rate in our sole discretion. You assume the risk that interest credited to the Fixed Account may not exceed the minimum guaranteed rate for any given year. We have no specific formula for determining the interest rate. Some factors we may consider are regulatory and tax requirements, general economic trends and competitive factors. TRANSFERS You may make transfers from the Fixed Account to any available Variable Funding Option(s) twice a year during the 30 days following the semiannual anniversary of the Contract Date. We limit transfers to an amount of up to 15% of the Fixed Account Contract Value on the semiannual Contract Date anniversary. (This restriction does not apply to transfers under the Dollar Cost Averaging Program.) Amounts previously transferred from the Fixed Account to Variable Funding Options may not be transferred back to the Fixed Account for a period of at least six months from the date of transfer. We reserve the right to waive either of these restrictions. Where permitted by state law, we reserve the right to restrict transfers into the Fixed Account whenever the credited interest rate on the Fixed Account is equal to the minimum guaranteed interest rate specified in your Contract. Automated transfers from the Fixed Account to any of the Variable Funding Options may begin at any time. Automated transfers from the Fixed Account may not deplete your Fixed Account value in a period of less than twelve months from your enrollment in the Dollar Cost Averaging Program. D-1 THIS PAGE INTENTIONALLY LEFT BLANK. APPENDIX E -------------------------------------------------------------------------------- ENHANCED DEATH BENEFIT FOR CONTRACTS ISSUED BEFORE JUNE 1, 1997 IF THE ANNUITANT DIES BEFORE AGE 75 AND BEFORE THE MATURITY DATE, the Company will pay to the beneficiary a death benefit equal to the greater of (1) the guaranteed death benefit, or (2) the Contract Value less any applicable premium tax or outstanding loans. IF THE ANNUITANT DIES ON OR AFTER AGE 75 AND BEFORE THE MATURITY DATE, the Company will pay to the beneficiary a death benefit in an amount equal to the greater of (1) the guaranteed death benefit as of the Annuitant's 75(th) birthday, plus additional Purchase Payments, minus surrenders, outstanding loans and applicable premium tax; or (2) the Contract Value less any applicable premium tax and outstanding loans. The guaranteed death benefit is equal to the Purchase Payments made to the Contract (minus surrenders, outstanding loans and applicable premium tax) increased by 5% on each Contract Date anniversary, but not beyond the Contract Date anniversary following the Annuitant's 75(th) birthday, with a maximum guaranteed death benefit of 200% of the total Purchase Payments minus surrenders and outstanding loans and applicable premium tax. E-1 THIS PAGE INTENTIONALLY LEFT BLANK. APPENDIX F -------------------------------------------------------------------------------- CONTENTS OF THE STATEMENT OF ADDITIONAL INFORMATION The Statement of Additional Information contains more specific information and financial statements relating to the Separate Account and MetLife Insurance Company of Connecticut. A list of the contents of the Statement of Additional Information is set forth below: The Insurance Company Principal Underwriter Distribution and Principal Underwriting Agreement Valuation of Assets Federal Tax Considerations Independent Registered Public Accounting Firm Financial Statements Copies of the Statement of Additional Information dated April 28, 2008 are available without charge. To request a copy, please clip this coupon on the line above, enter your name and address in the spaces provided below, and mail to MetLife Insurance Company of Connecticut, P.O. Box 10366, Des Moines, IA 50306- 0366. For the MetLife Insurance Company of Connecticut Statement of Additional Information please request MIC-Book-02. For the Statement of Additional Information for the contracts issued by the former MetLife Life and Annuity Company of Connecticut please request MLAC-Book-02. Name: ------------------------------------------------- Address: ---------------------------------------------- CHECK BOX: [ ] MIC-Book-02 [ ] MLAC-Book-02 F-1