-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, SlG9s3+0H8h8OJQbUy2b5V2vLFxpsSvUz7Dg4jtD2GSHF8zvdGSguTN7VRIYlbql 50XKAlspqbCrbgtPSOFinw== 0001075796-02-000012.txt : 20020910 0001075796-02-000012.hdr.sgml : 20020910 20020910153118 ACCESSION NUMBER: 0001075796-02-000012 CONFORMED SUBMISSION TYPE: 485BPOS PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 20020910 EFFECTIVENESS DATE: 20020910 FILER: COMPANY DATA: COMPANY CONFORMED NAME: COLI VUL 2 SERIES ACCOUNT CENTRAL INDEX KEY: 0001075796 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 485BPOS SEC ACT: 1933 Act SEC FILE NUMBER: 333-70963 FILM NUMBER: 02760667 BUSINESS ADDRESS: STREET 1: 8515 EAST ORCHARD RD CITY: GREENWOOD VILLAGE STATE: CO ZIP: 80111 MAIL ADDRESS: STREET 1: 8515 EAST ORCHARD RD STREET 2: 2T3 CITY: GREENWOOD VILLAGE STATE: CO ZIP: 80111 FILER: COMPANY DATA: COMPANY CONFORMED NAME: COLI VUL 2 SERIES ACCOUNT CENTRAL INDEX KEY: 0001075796 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 485BPOS SEC ACT: 1940 Act SEC FILE NUMBER: 811-09201 FILM NUMBER: 02760668 BUSINESS ADDRESS: STREET 1: 8515 EAST ORCHARD RD CITY: GREENWOOD VILLAGE STATE: CO ZIP: 80111 MAIL ADDRESS: STREET 1: 8515 EAST ORCHARD RD STREET 2: 2T3 CITY: GREENWOOD VILLAGE STATE: CO ZIP: 80111 485BPOS 1 stisup2.txt As filed with the Securities and Exchange Commission on September 10, 2002 Registration Nos. 333-70963 811-09201 - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------ POST-EFFECTIVE AMENDMENT NO. 7 TO FORM S-6 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ------------ COLI VUL-2 SERIES ACCOUNT (Exact Name of Trust) GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY (Name of Depositor) 8515 East Orchard Road Greenwood Village, Colorado 80111 (Complete Address of Depositor's Principal Executive Offices) William T. McCallum President and Chief Executive Officer GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY 8515 East Orchard Road Greenwood Village, Colorado 80111 (Name and Complete Address of Agent for Service) Copies to: James F. Jorden, Esq. Beverly A. Byrne, Esq. Jorden Burt LLP Counsel 1025 Thomas Jefferson Street, N.W. Great-West Life & Annuity Insurance Company Washington, D.C. 20007-5208 8515 East Orchard Road Greenwood Village, Colorado 80111
------------ It is proposed that this filing will become effective (check appropriate box): [X] immediately upon filing pursuant to paragraph (b) of Rule 485. [ ] on pursuant to paragraph (b) of Rule 485. --------- [ ] 60 days after filing pursuant to paragraph (a)(1) of Rule 485. [ ] on (date) pursuant to paragraph (a)(1) of Rule 485. If appropriate, check the following box: [ ] this post-effective amendment designates a new effective date for a previously filed post-effective amendment. ----------- Title of securities being offered - variable portion of flexible premium variable universal life insurance policies. ---------- Approximate date of proposed public offering: continuous. [ ] Check this box if it is proposed that this filing will become effective on (date) at (time) pursuant to Rule 487. EXPLANATORY NOTE This post-effective amendment no. 7 to the registration statement on Form S-6 (the "Registration Statement") is being filed pursuant to Rule 485(b) under the Securities Act of 1933, as amended, to supplement the Registration Statement (post-effective amendment no. 6) with a supplement to the prospectus, dated May 1, 2002. This post-effective amendment no. 7 relates only to the supplement filed herein and does not otherwise delete, amend, or supersede any information contained in the Registration Statement, except as expressly provided in the supplement. Key Business VUL -- Prospectus A Flexible Premium Variable Universal Life Insurance Policy offered by Great-West Life & Annuity Insurance Company in connection with its COLI VUL-2 Series Account Supplement dated September 10, 2002 to the Prospectus for the Key Business VUL dated May 1, 2002 On Page 2 of the prospectus, in the first sentence please delete the reference to 43 investment options and replace the reference to 46 investment options and add the following to the list of Funds in which the Divisions currently invest: STI Classic Variable Trust Capital Appreciation Fund Growth and Income Fund Small Cap Value Equity Fund All references in the Prospectus to "43 Divisions" or "43 investmentoptions" should read "46 Divisions" or "46 investment options," as appropriate. On Page 11 of the prospectus, within the Table of Fees and Expenses of the Funds, add the following: - ------------------------------------------------- ------------ ---------- -------------- ---------------- ------------ Management Other Gross Total Less Fee Net Total Fees Expenses Annual Waivers & Annual Fund Operating Expense Operating Expenses Reimbursement Expenses - ------------------------------------------------- ------------ ---------- -------------- ---------------- ------------ STI Classic Variable Trust o Capital Appreciation Fund 1.15% 0.29% 1.44% 0.29% 1.15%18 - ------------------------------------------------- ------------ ---------- -------------- ---------------- ------------ o Growth and Income Fund 0.90% 2.32% 3.22% 2.02% 1.20%19 - ------------------------------------------------- ------------ ---------- -------------- ---------------- ------------ o Small Cap Value Equity Fund 1.15% 0.76% 1.91% 0.71% 1.20%20 - ------------------------------------------------- ------------ ---------- -------------- ---------------- ------------
18 STI Capital Appreciation Fund: The Fund's adviser voluntarily waived a portion of the fees in order to keep total operating expenses at a specified level. The fee waiver will remain in place as of the date of this supplement, but the adviser may discontinue all or part of this fee waiver at any time. 19 STI Growth and Income Fund: The Fund's adviser has contractually agreed to waive fees and reimburse expenses in order to keep total operating expenses from exceeding 1.20% for a period of one year from May 1, 2002. 20 STI Small Cap Value Equity Fund: The Fund's adviser voluntarily waived a portion of the fees in order to keep total operating expenses at a specified level. The fee waiver will remain in place as of the date of this supplement, but the adviser may discontinue all or part of this fee waiver at any time. On Page 17 of the prospectus, add the following: STI Classic Variable Trust (advised by Trusco Capital Management, Inc.) STI Capital Appreciation Fund seeks to provide capital appreciation. It generally invests primarily in U.S. common stocks and other equity securities that the Fund's adviser believes have strong business fundamentals, such as revenue growth, cash flows, and earnings trends. STI Growth and Income Fund seeks to provide long-term capital appreciation with current income as a secondary investment goal. It generally invests primarily in equity securities, including common stocks of domestic companies and listed American Depositary Receipts (ADRs) of foreign companies, all with market capitalizations of at least $1 billion. However, the average market capitalization can vary throughout a full market cycle and will be flexible to allow the Fund's adviser to capture market opportunities. STI Small Cap Value Equity Fund seeks to achieve capital appreciation with current income as a secondary investment goal. It generally invests at least 80% of its net assets in common stocks of small-sized U.S. companies (i.e., companies with market capitalizations under $2 billion). In selecting investments, the Fund's adviser chooses companies that it believes are undervalued in the market. On Page 106 of the prospectus, please add the following: GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY CONSOLIDATED STATEMENTS OF INCOME [Dollars in Thousands] =================================================================================================================== [Unaudited] Three Months Ended Six Months Ended June 30, June 30, ---------------------------------- -- ---------------------------------- REVENUES: 2002 2001 2002 2001 -------------- --------------- --------------- -------------- Premium $ 259,488 $ 262,900 $ 549,009 $ 597,330 Fee income 233,264 231,601 460,008 482,850 Net investment income 234,582 243,009 462,500 482,029 Net realized gains on Investments 1,667 1,264 7,908 8,932 -------------- --------------- --------------- -------------- 729,001 738,774 1,479,425 1,571,141 -------------- --------------- --------------- -------------- BENEFITS AND EXPENSES: Life and other policy benefits 240,856 246,676 451,184 531,916 Increase (decrease) in reserves (14,367) (12,656) 25,227 29,315 Interest paid or credited to contractholders 125,129 133,038 251,029 266,822 Provision for policyholders' share of earnings on participating business (loss) (7) 723 922 2,311 Dividends to policyholders 16,088 16,165 40,290 39,526 -------------- --------------- --------------- -------------- 367,699 383,946 768,652 869,890 -------------- --------------- --------------- -------------- Commissions 59,102 46,951 98,539 94,230 Operating expenses 175,083 212,319 371,056 412,805 Premium taxes 9,547 6,447 15,347 13,586 Special charges 127,040 127,040 -------------- --------------- --------------- -------------- 611,431 776,703 1,253,594 1,517,551 -------------- --------------- --------------- -------------- INCOME BEFORE INCOME TAXES 117,570 (37,929) 225,831 53,590 PROVISION FOR INCOME TAXES: Current 37,307 44,686 44,169 57,725 Deferred 80 (60,941) 28,592 (41,911) -------------- --------------- --------------- -------------- 37,387 (16,255) 72,761 15,814 -------------- --------------- --------------- -------------- NET INCOME $ 80,183 $ (21,674) $ 153,070 $ 37,776 ============== =============== =============== ============== See notes to consolidated financial statements. GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY CONSOLIDATED BALANCE SHEETS [Dollars in Thousands] =================================================================================================================== June 30, December 31, ASSETS 2002 2001 -------------------- --------------------- [unaudited] INVESTMENTS: Fixed maturities available-for-sale, at fair value (amortized cost $9,423,071 and $9,904,453) $ 10,178,902 $ 10,116,175 Mortgage loans on real estate (net of allowances of $57,654 and $57,654) 522,105 613,453 Common stock, at fair value (cost $89,225 and $74,107) 91,119 73,344 Real estate 3,852 11,838 Policy loans 3,090,399 3,000,441 Short-term investments, available-for-sale (cost $501,923 and $427,398) 502,135 424,730 -------------------- --------------------- Total investments 14,388,512 14,239,981 OTHER ASSETS: Cash 361,310 213,731 Reinsurance receivable 312,501 282,352 Deferred policy acquisition costs 268,027 275,570 Investment income due and accrued 115,627 130,775 Amounts receivable related to uninsured accident and health plan claims (net of allowances of $41,200 and $53,431) 79,592 89,533 Premiums in course of collection (net of allowances of $14,495 and $22,217) 72,007 99,811 Deferred income taxes 101,801 149,140 Other assets 725,498 745,617 SEPARATE ACCOUNT ASSETS 11,916,664 12,584,661 -------------------- --------------------- TOTAL ASSETS $ 28,341,539 $ 28,811,171 ==================== ===================== (continued) GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY CONSOLIDATED BALANCE SHEETS [Dollars in Thousands] =================================================================================================================== June 30, December 31, LIABILITIES AND STOCKHOLDER'S EQUITY 2002 2001 - ------------------------------------ -------------------- --------------------- [unaudited] POLICY BENEFIT LIABILITIES: Policy reserves $ 12,273,499 $ 12,211,496 Policy and contract claims 396,431 401,389 Policyholders' funds 280,253 242,916 Provision for policyholders' dividends 75,744 74,740 Undistributed earnings on participating business 165,927 163,086 GENERAL LIABILITIES: Due to GWL 40,101 41,874 Due to GWL&A Financial Inc. 256,400 251,059 Repurchase agreements 315,698 250,889 Commercial paper 98,521 97,046 Other liabilities 951,128 1,021,541 SEPARATE ACCOUNT LIABILITIES 11,916,664 12,584,661 -------------------- --------------------- Total liabilities 26,770,366 27,340,697 -------------------- --------------------- STOCKHOLDER'S EQUITY: Preferred stock, $1 par value, 50,000,000 shares authorized; 0 shares issued and outstanding Common stock, $1 par value; 50,000,000 shares authorized; 7,032,000 shares issued and outstanding 7,032 7,032 Additional paid-in capital 716,508 712,801 Accumulated other comprehensive income 110,787 76,507 Retained earnings 736,846 674,134 -------------------- --------------------- Total stockholder's equity 1,571,173 1,470,474 -------------------- --------------------- TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY $ 28,341,539 $ 28,811,171 ==================== ===================== See notes to consolidated financial statements. (Concluded) GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY CONSOLIDATED STATEMENTS OF CASH FLOWS [Dollars in Thousands] =================================================================================================================== [Unaudited] Six Months Ended June 30, --------------------------------------------- OPERATING ACTIVITIES: 2002 2001 -------------------- --------------------- Net income $ 153,070 $ 37,776 Adjustments to reconcile net income to net cash provided by operating activities: Gain allocated to participating policyholders 922 2,311 Amortization of investments (37,991) (38,330) Realized gains on disposal of investments and write-downs of mortgage loans and real estate (7,908) (8,932) Amortization 19,834 24,519 Deferred income taxes 28,592 (41,911) Write-off of Goodwill 23,040 Changes in assets and liabilities: Policy benefit liabilities 197,437 111,767 Reinsurance receivable (30,149) 7,398 Accrued interest and other receivables 52,893 202,792 Other, net (67,325) (280,174) -------------------- --------------------- Net cash provided by operating activities 309,375 40,256 -------------------- --------------------- INVESTING ACTIVITIES: Proceeds from sales, maturities, and redemptions of investments: Fixed maturities available-for-sale Sales 3,013,838 2,747,351 Maturities and redemptions 699,609 629,040 Mortgage loans 102,047 76,757 Real estate 1,800 103,038 Common stock 7,347 19,600 Purchases of investments: Fixed maturities held-to-maturity (3,699,276) (3,532,344) Mortgage loans Real estate (2,243) (104,407) Common stock (15,372) (24,769) -------------------- --------------------- Net cash provided by (used in) investing activities 107,750 (85,734) -------------------- --------------------- (continued) GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY CONSOLIDATED STATEMENTS OF CASH FLOWS [Dollars in Thousands] =================================================================================================================== [Unaudited] Six Months Ended June 30, --------------------------------------------- FINANCING ACTIVITIES: 2002 2001 -------------------- --------------------- Contract withdrawals, net of deposits $ (249,040) $ (86,787) Net GWL repayments (1,773) (22,955) Net GWL&A Financial (repayments) borrowings 5,341 23,629 Dividends paid (90,358) (94,461) Commercial paper borrowings, net 1,475 1,070 Repurchase agreements borrowings, net 64,809 231,402 -------------------- --------------------- Net cash (used in) provided by financing activities (269,546) 51,898 -------------------- --------------------- NET INCREASE IN CASH 147,579 6,420 CASH, BEGINNING OF YEAR 213,731 153,977 -------------------- --------------------- CASH, END OF PERIOD $ 361,310 $ 160,397 ==================== ===================== See notes to consolidated financial statements. (Concluded) GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY CONSOLIDATED STATEMENT OF STOCKHOLDER'S EQUITY FOR THE SIX MONTHS ENDED JUNE 30, 2002 [Dollars in Thousands] ================================================================================================= [Unaudited] Accumulated Additional Other Preferred Stock Common Stock Paid-in Comprehensive Retained -------------------- ----------------------- Shares Amount Shares Amount Capital Income (Loss) Earnings Total -------- --------- ---------- ---------- ---------- -------------- ---------- ---------- BALANCE, JANUARY 1, 2002 0 $ 0 7,032,000 $ 7,032 $ 712,801 $ 76,507 $ 674,134 $ 1,470,474 Net income 153,070 153,070 Other comprehensive income 34,280 34,280 ---------- Total comprehensive income 187,350 ---------- Dividends (90,358) (90,358) Income tax benefit on stock compensation 3,707 3,707 -------- --------- ---------- ---------- ---------- -------------- ---------- ---------- BALANCE, JUNE 30, 2002 0 $ 0 7,032,000 $ 7,032 $ 716,508 $ 110,787 $ 736,846 $ 1,571,173 ======== ========= ========== ========== ========== ============== ========== ========== See notes to consolidated financial statements.
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS [Amounts in Thousands] ================================================================================ [Unaudited] 1. BASIS OF PRESENTATION The consolidated financial statements and related notes of Great-West Life & Annuity Insurance Company (the Company) have been prepared in accordance with accounting principles generally accepted in the United States of America applicable to interim financial reporting and do not include all of the information and footnotes required for complete financial statements. However, in the opinion of management, these statements include all normal recurring adjustments necessary for a fair presentation of the results. These financial statements should be read in conjunction with the audited consolidated financial statements and the accompanying notes included in the Company's latest annual report on Form 10-K for the year ended December 31, 2001. Operating results for the six months ended June 30, 2002 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2002. 2. NEW ACCOUNTING PRONOUNCEMENTS On June 29, 2001, Statement No. 142, "Goodwill and Other Intangible Assets" (SFAS No. 142) was approved by the FASB. SFAS No. 142 changes the accounting for goodwill and certain other intangibles from an amortization method to an impairment-only approach. Amortization of goodwill, including goodwill recorded in past business combinations, will cease upon adoption of this statement. The Company implemented SFAS No. 142 on January 1, 2002. Adoption of this statement did not have a material impact on the Company's financial position or results of operations. In August 2001, the FASB issued Statement No.144 "Accounting for the Impairment or Disposal of Long-Lived Assets" (SFAS No.144). SFAS No.144 supercedes current accounting guidance relating to impairment of long-lived assets and provides a single accounting methodology for long-lived assets to be disposed of, and also supercedes existing guidance with respect to reporting the effects of the disposal of a business. SFAS No.144 was adopted January 1, 2002 without a material impact on the Company's financial position or results of operations. In April 2002, the FASB issued Statement No. 145 "Rescission of FASB No. 4, 44 and 64, Amendment of FASB Statement No. 13, and Technical Corrections" (SFAS No. 145). FASB No. 4 required all gains or losses from extinguishment of debt to be classified as extraordinary items net of income taxes. SFAS No. 145 requires that gains and losses from extinguishment of debt be evaluated under the provision of Accounting Principles Board Opinion No. 30, and be classified as ordinary items unless they are unusual or infrequent or meet the specific criteria for treatment as an extraordinary item. This statement is effective January 1, 2003. The Company does not expect this statement to have a material effect on the Company's financial position or results of operations. In July 2002, the FASB issued Statement No. 146 " Accounting for Costs Associated With Exit or Disposal Activities" (SFAS No. 146). This statement addresses financial accounting and reporting for costs associated with exit or disposal activities and nullifies EITF Issue No. 94-3, "Liability Recognition for Certain Employee Termination Benefits and Other Costs to Exit an Activity (including Certain Costs Incurred in a Restructuring)." This statement requires recognition of a liability for a cost associated with an exit or disposal activity when the liability is incurred, as opposed to when the entity commits to an exit plan under EITF 94-3. SFAS No. 146 is to be applied prospectively to exit or disposal activities initiated after December 31, 2002. The Company does not expect this statement to have a material impact on the Company's financial position or results of operations. 3. OTHER In the second quarter of 2001, the Company recorded a $127 million special charge, ($80.9 million, net of tax) related to Alta Health & Life Insurance Company (Alta). The principal components of the charge include a $46 million premium deficiency reserve related to under-pricing on the block of business, a $29 million reserve for doubtful premium receivables, a $28 million reserve for doubtful accident and health plan claim receivables, and $24 million decrease in goodwill and other. Alta was acquired by the Company on July 8, 1998. During 1999 and 2000 the Alta business continued to be run as a free-standing unit but was converted to the Company's system and accounting processes. This conversion program resulted in significant issues related to pricing, underwriting, and administration of the business. The Company has decided to transition Alta business to other Company products. All Alta sales and administration staff have become employees of the Company and the underwriting functions will be conducted by the underwriting staff of the Company. The Company is involved in various legal proceedings that arise in the ordinary course of its business. In the opinion of management, after consultation with counsel, the resolution of these proceedings should not have a material adverse effect on its financial position or results of operations. Certain reclassifications have been made to the 2001 financial statements to conform to the 2002 presentation. On Page 109 of the prospectus, please delete Appendix C and replace with the following: Appendix C -- Sample Hypothetical Illustrations Illustrations of Death Benefits, Surrender Values And Accumulated Premiums The illustrations in this Prospectus have been prepared to help show how values under the Policy change with investment performance. The illustrations on the following pages illustrate the way in which a Policy Year's death benefit, Account Value and Cash Surrender Value could vary over an extended period of time. They assume that all premiums are allocated to and remain in the Series Account for the entire period shown and are based on hypothetical gross annual investment returns for the Funds (i.e., investment income and capital gains and losses, realized or unrealized) equivalent to constant gross annual rates of 0%, 6%, and 12% over the periods indicated. The Account Values and death benefits would be different from those shown if the gross annual investment rates of return averaged 0%, 6%, and 12% over a period of years, but fluctuated above or below such averages for individual Policy Years. The values would also be different depending on the allocation of a Policy's total Account Value among the Divisions of the Series Account, if the actual rates of return averaged 0%, 6% or 12%, but the rates of each Fund varied above and below such averages. The amounts shown for the death benefits and Account Values take into account all charges and deductions imposed under the Policy based on the assumptions set forth in the tables below. These include the Expense Charges Applied to Premium, the Daily Risk Percentage charged against the Series Account for mortality and expense risks, the Monthly Service Charge and the Monthly Cost of Insurance. The Expense Charges Applied to Premium is equal to a guaranteed maximum of 6.5% for sales load and a guaranteed maximum of 3.5% to cover our federal tax obligations and the applicable local and state premium tax. The current level of these charges is 5.5% (for Policy Years 1 through 10 only) and 3.5%, respectively. The Daily Risk Percentage charged against the Series Account for mortality and expense risks is an annual effective rate of 0.40% for the first five Policy Years, 0.25% for Policy Years 6 through 20, and 0.10% thereafter and is guaranteed not to exceed an annual effective rate of 0.90%. The Monthly Service Charge is $10.00 per month for first three Policy Years and $7.50 per Policy Month for all Policy Years thereafter. This Charge is guaranteed not to exceed $15 per Policy Month. The amounts shown in the tables also take into account the Funds' advisory fees and operating expenses, which are assumed to be at an annual rate of 0.85% of the average daily net assets of each Fund. This is based upon a simple average of the advisory fees and expenses of all the Funds for the most recent fiscal year taking into account any a-applicable expense caps or expense reimbursement arrangements. Actual fees and expenses that you will incur may be more or less than 0.85%, and will vary from year to year. See "Charges and Deductions -- Fund Expenses" in this prospectus and the prospectuses for the Funds for more information on Fund expenses. The gross annual rates of investment return of 0%, 6% and 12% correspond, on a current basis, to net annual rates of -1.24%, 4.68%, and 10.61%, respectively, during the first five Policy Years, -1.09%, 4.84%, and10.78%, respectively, for Policy Years 6 through 20, and -0.95%, 5.00% and 10.94%, respectively, thereafter. The hypothetical returns shown in the tables do not reflect any charges for income taxes against the Series Account since no charges are currently made. If, in the future, such charges are made, in order to produce the illustrated death benefits, Account Values and Cash Surrender Values, the gross annual investment rate of return would have to exceed 0%, 6%, or 12% by a sufficient amount to cover the tax charges. The second column of each table shows the amount that would accumulate if an amount equal to each premium were invested and earned interest, after taxes, at 5% per year, compounded annually. We will furnish upon request a comparable table using any specific set of circumstances. In addition to a table assuming Policy charges at their maximum, we will furnish a table assuming current Policy charges. TABLE 1 Great-West Life & Annuity Insurance Company COLI VUL-2 Series Account Male, Age 45 $1,000,000 Total Face Amount Annual Premium $12,524.03 Death Benefit Option 1 Current Policy Charges Hypothetical 0% Gross Investment Hypothetical 6% Gross Hypothetical 12% Gross Return Net -1.24% Investment Return Net 4. 68% Investment Return Net 10. 61% Premiums Paid Plus Policy interest At Contract Surrender Death Contract Surrender Death Contract Surrender Death ----- Year 5% Per Year Value Value Benefit Value Value Benefit Value Value Benefit ---- ----------- ----- ----- ------- ----- ----- ------- ----- ----- ------- 1 13,150 10,431 11,057 1,000,000 11,080 1,000,000 11,730 12,433 1,000,000 11,745 2 26,958 20,158 21,166 1,000,000 22,088 1,000,000 24,096 25,301 1,000,000 23,192 3 41,456 29,201 30,369 1,000,000 33,034 1,000,000 37,183 38,670 1,000,000 34,355 4 56,679 37,608 38,736 1,000,000 43,958 1,000,000 51,117 52,651 1,000,000 45,277 5 72,663 44,004 44,884 1,000,000 53,451 54,520 1,000,000 64,554 65,846 1,000,000 6 89,447 49,976 50,476 1,000,000 63,071 63,702 1,000,000 79,140 79,931 1,000,000 7 107,069 55,353 55,353 1,000,000 72,639 72,639 1,000,000 94,804 94,804 1,000,000 8 125,573 60,142 60,142 1,000,000 82,162 82,162 1,000,000 111,689 111,689 1,000,000 9 145,002 64,465 64,465 1,000,000 91,762 91,762 1,000,000 130,067 130,067 1,000,000 10 165,402 68,216 68,216 1,000,000 101,343 101,343 1,000,000 150,020 150,020 1,000,000 11 186,823 74,070 74,070 1,000,000 113,607 113,607 1,000,000 174,427 174,427 1,000,000 12 209,314 79,456 79,456 1,000,000 126,109 126,109 1,000,000 201,211 201,211 1,000,000 13 232,930 84,382 84,382 1,000,000 138,874 138,874 1,000,000 230,672 230,672 1,000,000 14 257,727 88,855 88,855 1,000,000 151,930 151,930 1,000,000 263,148 263,148 1,000,000 15 283,763 92,772 92,772 1,000,000 165,203 165,203 1,000,000 298,930 298,930 1,000,000 16 311,101 96,033 96,033 1,000,000 178,620 178,620 1,000,000 338,363 338,363 1,000,000 17 339,807 98,537 98,537 1,000,000 192,110 192,110 1,000,000 381,855 381,855 1,000,000 18 369,947 100,077 100,077 1,000,000 205,504 205,504 1,000,000 429,813 429,813 1,000,000 19 401,595 100,549 100,549 1,000,000 218,731 218,731 1,000,000 482,811 482,811 1,000,000 20 434,825 99,848 99,848 1,000,000 231,717 231,717 1,000,000 541,532 541,532 1,000,000 Age 60 283,763 92,772 92,772 1,000,000 165,203 165,203 1,000,000 298,930 298,930 1,000,000 Age 65 434,825 99,848 99,848 1,000,000 231,717 231,717 1,000,000 541,532 541,532 1,000,000 Age 70 627,622 92,898 92,898 1,000,000 308,495 308,495 1,000,000 952,348 952,348 1,475,406 Age 75 873,686 56,671 56,671 1,000,000 390,624 390,624 1,000,000 1,609,757 1,609,757 2,262,481 Notes: (1) "0" values in the "Contract Value," "Surrender Value" and "Death Benefit" columns indicate Policy lapse. (2) Assumes a $12,524.03 premium is paid at the beginning of each Policy Year. Values will be different if premiums are paid with a different frequency or in different amounts. (3) Assumes that no policy loans have been made. Excessive loans or partial withdrawals may cause your Policy to lapse due to insufficient Account Value. The hypothetical investment rates of return are illustrative only, and should not be deemed a representation of past or future investment rates of return. Actual investment results may be more or less than those shown, and will depend on a number of factors, including the investment allocations by a policy owner, and the different investment rates of return for the Funds. The Cash Surrender Value and death benefit for a Policy would be different from those shown if the actual rates of investment return averaged 0%, 6%, and 12% over a period of years, but fluctuated above and below those averages for individual Policy Years. They would also be different if any policy loans or partial withdrawals were made. No representations can be made that these hypothetical investment rates of return can be achieved for any one year or sustained over any period of time. TABLE 2 Great-West Life & Annuity Insurance Company COLI VUL-2 Series Account Male, Age 45 $1,000,000 Total Face Amount Annual Premium $12,524.03 Death Benefit Option 1 Guaranteed Policy Charges Hypothetical 0% Gross Hypothetical 6% Gross Investment Hypothetical 12% Gross Investment Return Net -1.73% Return Net 4.16% Investment Return Net 10.06% Premiums Paid Plus Policy interest At Contract Surrender Death Contract Surrender Death Contract Surrender Death ----- Year 5% Per Year Value Value Benefit Value Value Benefit Value Value Benefit ---- ----------- ----- ----- ------- ----- ----- ------- ----- ----- ------- 1 13,150 6,554 6,947 1,000,000 7,075 7,499 1,000,000 7,598 8,054 1,000,000 2 26,958 12,555 13,183 1,000,000 13,994 14,694 1,000,000 15,500 16,275 1,000,000 3 41,456 18,133 18,858 1,000,000 20,878 21,713 1,000,000 23,871 25,826 1,000,000 4 56,679 23,296 23,995 1,000,000 27,730 28,562 1,000,000 32,767 33,750 1,000,000 5 72,663 27,938 28,497 1,000,000 34,435 35,124 1,000,000 42,129 42,972 1,000,000 6 89,447 32,070 32,390 1,000,000 40,993 41,403 1,000,000 52,018 52,538 1,000,000 7 107,069 35,586 35,586 1,000,000 47,287 47,287 1,000,000 62,380 62,380 1,000,000 8 125,573 38,384 38,384 1,000,000 53,195 53,195 1,000,000 73,165 73,165 1,000,000 9 145,002 40,474 40,474 1,000,000 58,707 58,707 1,000,000 84,434 84,434 1,000,000 10 165,402 41,752 41,752 1,000,000 63,696 63,696 1,000,000 96,143 96,143 1,000,000 11 186,823 42,114 42,114 1,000,000 68,032 68,032 1,000,000 108,250 108,250 1,000,000 12 209,314 41,567 41,567 1,000,000 71,686 71,686 1,000,000 120,822 120,822 1,000,000 13 232,930 40,002 40,002 1,000,000 74,518 74,518 1,000,000 133,830 133,830 1,000,000 14 257,727 37,420 37,420 1,000,000 76,489 76,489 1,000,000 147,352 147,352 1,000,000 15 283,763 33,707 33,707 1,000,000 77,441 77,441 1,000,000 161,372 161,372 1,000,000 16 311,101 28,741 28,741 1,000,000 77,207 77,207 1,000,000 175,879 175,879 1,000,000 17 339,807 22,395 22,395 1,000,000 75,604 75,604 1,000,000 190,868 190,868 1,000,000 18 369,947 14,536 14,536 1,000,000 72,431 72,431 1,000,000 206,343 206,343 1,000,000 19 401,595 4,783 4,783 1,000,000 67,239 67,239 1,000,000 222,116 222,116 1,000,000 20 434,825 0 0 1,000,000 59,766 59,766 1,000,000 238,191 238,191 1,000,000 Age 60 283,763 33,707 33,707 1,000,000 77,441 77,441 1,000,000 161,372 161,372 1,000,000 Age 65 434,825 0 0 1,000,000 59,766 59,766 1,000,000 238,191 238,191 1,000,000 Age 70 627,622 0 0 1,000,000 0 0 1,000,000 321,492 321,492 1,000,000 Age 75 873,686 0 0 1,000,000 0 0 1,000,000 402,374 402,374 1,000,000 Notes: (1) "0" values in the "Contract Value," "Surrender Value" and "Death Benefit" columns indicate Policy lapse. (2) Assumes a $12,524.03 premium is paid at the beginning of each Policy Year. Values will be different if premiums are paid with a different frequency or in different amounts. (3) Assumes that no policy loans have been made. Excessive loans or partial withdrawals may cause your Policy to lapse due to insufficient Account Value. The hypothetical investment rates of return are illustrative only, and should not be deemed a representation of past or future investment rates of return. Actual investment results may be more or less than those shown, and will depend on a number of factors, including the investment allocations by a policy owner, and the different investment rates of return for the Funds. The Cash Surrender Value and death benefit for a Policy would be different from those shown if the actual rates of investment return averaged 0%, 6%, and 12% over a period of years, but fluctuated above and below those averages for individual Policy Years. They would also be different if any policy loans or partial withdrawals were made. No representations can be made that these hypothetical investment rates of return can be achieved for any one year or sustained over any period of time.
SIGNATURES As required by the Securities Act of 1933, the registrant certifies that it meets the requirements for effectiveness of this Registration Statement pursuant to Rule 485(b) under the Securities Act of 1933 and has duly caused this Registration Statement to be signed on its behalf in the City of Greenwood Village, State of Colorado, on the 10th day of September, 2002. COLI VUL-2 SERIES ACCOUNT (Registrant) BY: GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY (Depositor) BY: /s/ W.T. McCallum ----------------- W.T. McCallum President and Chief Executive Officer As required by the Securities Act of 1933, this Registration Statement has been signed below by the following persons in the capacities and on the dates indicated: /s/ R. Gratton* R. Gratton* Chairman of the Board September 10, 2002 /s/ W.T. McCallum W.T. McCallum President, Chief Executive September 10, 2002 Officer and Director /s/ M.T.G. Graye M.T.G. Graye Chief Financial Officer September 10, 2002 /s/ J. Balog* J. Balog* Director September 10, 2002 /s/ J.W. Burns* J.W. Burns* Director September 10, 2002 /s/ O.T. Dackow* O.T. Dackow* Director September 10, 2002 /s/ A. Desmarais* A. Desmarais* Director September 10, 2002 /s/ P. Desmarais, Jr.* P. Desmarais, Jr.* Director September 10, 2002 /s/ K.P. Kavanagh* K.P. Kavanagh* Director September 10, 2002 /s/ W. Mackness* W. Mackness* Director September 10, 2002 /s/ J.E.A. Nickerson* J.E.A. Nickerson* Director September 10, 2002 /s/ P.M. Pitfield* P.M. Pitfield* Director September 10, 2002 /s/ M. Plessis-Belair* M. Plessis-Belair* Director September 10, 2002 /s/ B.E. Walsh* B.E. Walsh* Director September 10, 2002
*By: /s/ D.C. Lennox D.C. Lennox, Attorney-in-Fact pursuant to Powers of Attorney filed under Registrant's Pre-Effective Amendment No. 1 to Form S-6, filed with the Securities and Exchange Commission on June 23, 1999. EXHIBIT INDEX 6. Actuarial Opinion and Consent Exhibit 6 - Actuarial Opinion and Consent August 27, 2002 Great-West Life & Annuity Insurance Company 8515 East Orchard Road Greenwood Village, Colorado 80111 Re: COLI VUL-2 Series Account of Great-West Life & Annuity Insurance Company Post-Effective Amendment No. 7 to the Registration Statement on Form S-6 File No. 333-70963 Ladies and Gentlemen: This opinion is furnished in connection with the filing of Post-Effective Amendment No. 7 to the Registration Statement on Form S-6 (file No. 333-70963) (the "Registration Statement") which covers premiums expected to be received under flexible premium variable universal life insurance policies (the "Policies") to be offered by Great-West Life & Annuity Insurance Company (the "Company"). The prospectus included in the Registration Statement describes the Policy, which will be offered by the Company in each State where it has been approved by appropriate State insurance authorities. I am familiar with the Policy form and the Registration Statement and Exhibits thereto. In my capacity as Vice President of the Company, I have provided actuarial advice concerning: The preparation of the Registration Statement to be filed by the Company and its COLI VUL-2 Series Account with the Securities and Exchange Commission under the Securities Act of 1933 with respect to the Policies: and The preparation of the Policy forms for the Policy described in the Registration Statement. It is my professional opinion that: 1. The hypothetical illustrations of death benefits, account value, cash surrender value and total premiums paid plus interest at 5 percent shown in the prospectus, based on the assumptions stated in the illustration are consistent with the provisions of the Policy. The rate structure of the Policy has not been designed so as to make the relationship between premium and benefits, as shown in the illustrations included, appear to be correspondingly more favorable to prospective buyers than other illustrations which could have been provided at other combinations of ages, sex of the insured, death benefit option and amount, definition of life insurance test, premium class, and premium amounts. Insured of other premium classes may have higher costs of insurance charges. 2. All other numerical examples shown in the prospectus are consistent with the Policy and our practices, and have not been designed to appear more favorable to prospective buyers than other examples which could have been provided. I hereby consent to the filing of this opinion as an Exhibit to the Registration Statement and the use of my name under the heading "Experts" in the prospectus. Sincerely, /s/ Ron Laeyendecker Ron Laeyendecker, F.S.A., M.A.A.A. Vice President Life Insurance Markets -----END PRIVACY-ENHANCED MESSAGE-----