-----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, FQdll4Bz3h7jAOobL9GcTfE8cK43rqcxzS/QYsxt8wtUzjyrVzvqLpAC4eWPeRX0 zxvNBctUmhNuy/zcXqg48w== 0000945094-00-000442.txt : 20001211 0000945094-00-000442.hdr.sgml : 20001211 ACCESSION NUMBER: 0000945094-00-000442 CONFORMED SUBMISSION TYPE: 497 PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 20001208 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NORTHBROOK VARIABLE ANNUITY ACCOUNT II CENTRAL INDEX KEY: 0000864922 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] STATE OF INCORPORATION: IL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 497 SEC ACT: SEC FILE NUMBER: 033-35412 FILM NUMBER: 786136 BUSINESS ADDRESS: STREET 1: 3100 SANDERS RD STREET 2: C/O NORTHBROOK LIFE INSURANCE CO CITY: NORTHBROOK STATE: IL ZIP: 60062 BUSINESS PHONE: 8474022400 MAIL ADDRESS: STREET 1: 3100 SANDERS RD CITY: NORTHBROOK STATE: IL ZIP: 60062 497 1 0001.txt NBVAIIEEDB As filed with the Securities and Exchange Commission on December 8, 2000. - -------------------------------------------------------------------------------- File Nos. 033-35412 811-06116 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM N-4 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 POST-EFFECTIVE AMENDMENT NO. 31 AND/OR REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 AMENDMENT NO. 38 NORTHBROOK VARIABLE ANNUITY ACCOUNT II (Exact Name of Registrant) NORTHBROOK LIFE INSURANCE COMPANY (Name of Depositor) MICHAEL J. VELOTTA VICE PRESIDENT, SECRETARY AND GENERAL COUNSEL NORTHBROOK LIFE INSURANCE COMPANY 3100 SANDERS ROAD NORTHBROOK, ILLINOIS 60062 847/402-2400 (Name and Complete Address of Agent for Service) COPIES TO: CHARLES M. SMITH, JR., ESQUIRE DANIEL J. FITZPATRICK, ESQUIRE ALLSTATE LIFE INSURANCE COMPANY DEAN WITTER REYNOLDS INC. 3100 SANDERS ROAD, SUITE J5B TWO WORLD TRADE CENTER NORTHBROOK, ILLINOIS 60062 NEW YORK, NEW YORK 10048 APPROXIMATE DATE OF PROPOSED PUBLIC OFFERING: CONTINUOUS IT IS PROPOSED THAT THIS FILING WILL BECOME EFFECTIVE (CHECK APPROPRIATE BOX) __ immediately upon filing pursuant to paragraph (b) of Rule 485 __ on (date) pursuant to paragraph (b) of Rule 485 60 days after filing __ 60 days after filing pursuant to paragraph (a)(1) of Rule 485 _X_on December 8, 2000 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 REGISTERED: Units of Interest in the Northbrook Variable Annuity Account II under Deferred Variable Annuity Contracts. Explanatory Note Registrant is filing this amendment ("Amendment") to add the Enhanced Earnings Death Benefit Option ("new Option") to the Morgan Stanley Dean Witter Variable Annuity II contract ("Contract") described in the currently effective prospectus and Statement of additional Information for that Contract. The new Option will be offered to new and existing Contract owners and may be selected on its own or in addition to any existing death or income benefit option. The Amendment is not intended to amend or delete any part of the Registration Statement, except as specifically noted herein. NORTHBROOK LIFE INSURANCE COMPANY NORTHBROOK VARIABLE ANNUITY ACCOUNT II SUPPLEMENT, DATED DECEMBER 8, 2000, TO THE MORGAN STANLEY DEAN WITTER VARIABLE ANNUITY II PROSPECTUS DATED MAY 2, 2000 This supplement describes the Enhanced Earnings Death Benefit Option ("EEDBO") now available with the Morgan Stanley Dean Witter Variable Annuity II contract ("Contract") offered by Northbrook Life Insurance Company. PLEASE KEEP IN MIND, ONCE YOU HAVE SELECTED AN OPTIONAL INCOME OR DEATH BENEFIT (EACH AN "OPTION"), YOUR ABILITY TO SELECT A DIFFERENT OPTION MAY BE LIMITED. PLEASE CONSULT WITH YOUR FINANCIAL ADVISOR CONCERNING THE EFFECT OF SELECTING A DIFFERENT OPTION BEFORE DOING SO. WE MAY DISCONTINUE THE OFFERING OF THIS OPTION AT ANYTIME. This supplement describes the EEDBO with the options available to contractholders having an Effective Date prior to November 6, 2000 ("old Options"). This supplement also describes the EEDBO with Income Benefit Combination Option 2 and the Income and Death Benefit Combination Option ("new options) available December 8, 2000 and as described in a separate supplement dated December 8, 2000. Please keep this supplement for future reference together with your prospectus. All capitalized terms have the same meaning as those included in the prospectus. THE EEDBO MAY NOT BE AVAILABLE IN ALL STATES. Your prospectus is amended as follows: Page 4: Insert the following after the first bullet under the "Expenses" heading: o If you select the Enhanced Earnings Death Benefit Option, the Total Variable Account annual fees will equal 1.55% of average daily net assets (1.68% if you also select the Enhanced Death Benefit Option, the Performance Death Benefit Option, or the Performance Income Benefit Option, 1.79% if you also select the Performance Benefit Combination Option or the Death Benefit Combination Option, 1.85% if you also select the Income Benefit Combination Option 2, or 2.05% if you also select the Income and Death Benefit Combination Option 2). If you qualify for and elect the Longevity Reward Rider, the annual fees are reduced by 0.07% under any Option listed above. See the description of each Option and the Rider for the availability of each. Page 7: Replace the section entitled "Variable Account Annual Expenses," with the following table: For Contracts Issue Prior to December 8, 2000 with old Options Variable Account Annual Expenses (As A Percentage Of Average Daily Net Asset Value Deducted From Each Variable Sub-Account)
------------------------------ --------------- -------------- -------------- --------------- -------------- -------------- With the With the With the With the With the Death Basic Contract Enhanced Performance Performance Performance Benefit Death Death Income Benefit Combination Benefit Benefit Benefit Option Combination Option Option Option Option ------------------------------ --------------- -------------- -------------- --------------- -------------- -------------- ------------------------------ --------------- -------------- -------------- --------------- -------------- -------------- Mortality and Expense Risk 1.25% 1.38% 1.38% 1.38% 1.49% 1.49% Charge ------------------------------ --------------- -------------- -------------- --------------- -------------- -------------- ------------------------------ --------------- -------------- -------------- --------------- -------------- -------------- Administrative Expense Charge 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% ------------------------------ --------------- -------------- -------------- --------------- -------------- -------------- ------------------------------ --------------- -------------- -------------- --------------- -------------- -------------- Total Variable Account Annual Expenses 1.35% 1.48% 1.48% 1.48% 1.59% 1.59% ------------------------------ --------------- -------------- -------------- --------------- -------------- -------------- Variable Account Annual Expenses - With the EEDBO (As A Percentage Of Average Daily Net Asset Value Deducted From Each Variable Sub-Account) ------------------------------ --------------- -------------- -------------- --------------- -------------- -------------- Basic Contract With With the With the With the With the With the Death the Enhanced Enhanced Performance Performance Performance Benefit Earnings Death Death Income Benefit Combination Death Benefit Benefit Benefit Benefit Option Combination Option Option (EEDBO) Option and Option Option the EEDBO ------------------------------ --------------- -------------- -------------- --------------- -------------- -------------- ------------------------------ --------------- -------------- -------------- --------------- -------------- -------------- Mortality and Expense Risk 1.45% 1.58% 1.58% 1. 58% 1.69% 1.69% Charge ------------------------------ --------------- -------------- -------------- --------------- -------------- -------------- ------------------------------ --------------- -------------- -------------- --------------- -------------- -------------- Administrative Expense Charge 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% ------------------------------ --------------- -------------- -------------- --------------- -------------- -------------- ------------------------------ --------------- -------------- -------------- --------------- -------------- -------------- Total Variable Account Annual Expenses 1.55% 1.68% 1.68% 1.68% 1.79% 1.79% ------------------------------ --------------- -------------- -------------- --------------- -------------- -------------- For Contracts Issued After December 8, 2000 or Contracts Issued Prior to December 8, 2000 with New Options Variable Account Annual Expenses (As A Percentage Of Average Daily Net Asset Value Deducted From Each Variable Sub-Account) ------------------------------- -------------- -------------- --------------- -------------- -------------- With the With the With the With the Basic Performance Death Benefit Income Income and Contract Death Combination Benefit Death Benefit Benefit Option Combination Combination Option Option 2 Option 2 ------------------------------- -------------- -------------- --------------- -------------- -------------- ------------------------------- -------------- -------------- --------------- -------------- -------------- Mortality and Expense Risk 1.25% 1.38% 1.49% 1.55% 1.75% Charge ------------------------------- -------------- -------------- --------------- -------------- -------------- ------------------------------- -------------- -------------- --------------- -------------- -------------- Administrative Expense Charge 0.10% 0.10% 0.10% 0.10% 0.10% ------------------------------- -------------- -------------- --------------- -------------- -------------- ------------------------------- -------------- -------------- --------------- -------------- -------------- Total Variable Account Annual Expenses 1.35% 1.48% 1.59% 1.65% 1.85% ------------------------------- -------------- -------------- --------------- -------------- -------------- Variable Account Annual Expenses - With the EEDBO (As A Percentage Of Average Daily Net Asset Value Deducted From Each Variable Sub-Account) ------------------------------- -------------- -------------- --------------- -------------- -------------- Basic Contract With the With the With the With the With the Performance Death Benefit Income Income and Enhanced Death Combination Benefit Death Benefit Earnings Benefit Option and Combination Combination Death Option and the EEDBO Option 2 and Option 2 and Benefit the EEDBO the EEDBO the EEDBO Option (EEDBO) ------------------------------- -------------- -------------- --------------- -------------- -------------- ------------------------------- -------------- -------------- --------------- -------------- -------------- Mortality and Expense Risk 1.45% 1.58% 1.69% 1.75% 1.95% Charge ------------------------------- -------------- -------------- --------------- -------------- -------------- ------------------------------- -------------- -------------- --------------- -------------- -------------- Administrative Expense Charge 0.10% 0.10% 0.10% 0.10% 0.10% ------------------------------- -------------- -------------- --------------- -------------- -------------- ------------------------------- -------------- -------------- --------------- -------------- -------------- Total Variable Account Annual Expenses 1.55% 1.68% 1.79% 1.85% 2.05% ------------------------------- -------------- -------------- --------------- -------------- --------------
Page 10: Replace "Example 1" with the following: EXAMPLE 1 The example below shows the dollar amount of expenses that you would bear directly or indirectly if you: o invested $1,000 in a Variable Sub-Account, o earned a 5% annual return on your investment, o surrendered your Contract or you began receiving income payments for a specified period of less than 120 months at the end of each time period, o elected the Enhanced Earnings Death Benefit Option, and o elected the Income and Death Benefit Combination Option 2. THE EXAMPLE ASSUMES THAT ANY PORTFOLIO EXPENSE WAIVERS OR REIMBURSEMENT ARRANGEMENTS DESCRIBED IN THE FOOTNOTES ABOVE ARE IN EFFECT FOR THE TIME PERIODS PRESENTED BELOW. THE EXAMPLE DOES NOT INCLUDE ANY TAXES OR TAX PENALTIES YOU MAY BE REQUIRED TO PAY IF YOU SURRENDER YOUR CONTRACT.
1 YEARS 3 YEARS 5 YEARS 10 YEARS ------- ------- ------- -------- AIM CAPITAL APPRECIATION $72 $114 $160 $319 AIM GROWTH $72 $114 $160 $319 AIM VALUE $72 $115 $161 $322 ALLIANCE GROWTH $76 $126 $179 $356 ALLIANCE GROWTH AND INCOME $74 $122 $172 $342 ALLIANCE PREMIER GROWTH $77 $131 $188 $372 MSDW AGGRESSIVE EQUITY $69 $108 $149 $298 MSDW CAPITAL GROWTH $71 $114 $159 $318 MSDW COMPETITIVE EDGE $70 $109 $151 $302 MSDW DIVIDEND GROWTH $69 $108 $149 $298 MSDW EQUITY $69 $108 $149 $297 MSDW EUROPEAN GROWTH $75 $124 $175 $349 MSDW GLOBAL DIVIDEND GROWTH $73 $117 $165 $329 MSDW HIGH YIELD $69 $108 $150 $299 MSDW INCOME BUILDER $72 $117 $164 $327 MSDW MONEY MARKET $69 $108 $149 $298 MSDW PACIFIC GROWTH $79 $135 $194 $384 MSDW QUALITY INCOME PLUS $69 $108 $149 $298 MSDW S&P 500 INDEX $69 $107 $147 $294 MSDW SHORT-TERM BOND $70 $111 $154 $308 MSDW STRATEGIST $69 $108 $149 $298 MSDW UTILITIES $71 $113 $157 $313 MSDW EMERGING MARKETS EQUITY $82 $146 $212 $417 MSDW EQUITY GROWTH $73 $118 $166 $330 MSDW INTERNATIONAL MAGNUM $76 $127 $181 $360 MSDW MID-CAP VALUE $75 $124 $176 $350 MSDW U.S. REAL ESTATE $75 $126 $178 $354 PUTNAM GROWTH AND INCOME $71 $112 $156 $311 PUTNAM INTERNATIONAL GROWTH $76 $128 $182 $361 PUTNAM VOYAGER $71 $114 $159 $318 VAN KAMPEN EMERGING GROWTH $73 $118 $166 $330 INFORMATION FUND $72 $116 $162 $323
Page 11: Replace "Example 2" with the following: EXAMPLE 2 Same assumptions as Example 1 above, except that you decided not to surrender your Contract, or you began receiving income payments (for at least 120 months if under an Income Plan with a specified period), at the end of each period.
1 YEARS 3 YEARS 5 YEARS 10 YEARS ------- ------- ------- -------- AIM CAPITAL APPRECIATION $29 $89 $151 $319 AIM GROWTH $29 $89 $151 $319 AIM VALUE $29 $90 $153 $322 ALLIANCE GROWTH $33 $101 $171 $356 ALLIANCE GROWTH AND INCOME $31 $96 $163 $342 ALLIANCE PREMIER GROWTH $35 $106 $179 $372 MSDW AGGRESSIVE EQUITY $27 $82 $141 $298 MSDW CAPITAL GROWTH $29 $89 $151 $318 MSDW COMPETITIVE EDGE $27 $84 $143 $302 MSDW DIVIDEND GROWTH $27 $82 $141 $298 MSDW EQUITY $27 $82 $140 $297 MSDW EUROPEAN GROWTH $32 $98 $167 $349 MSDW GLOBAL DIVIDEND GROWTH $30 $92 $156 $329 MSDW HIGH YIELD $27 $83 $141 $299 MSDW INCOME BUILDER $30 $91 $155 $327 MSDW MONEY MARKET $27 $82 $141 $298 MSDW PACIFIC GROWTH $36 $110 $186 $384 MSDW QUALITY INCOME PLUS $27 $82 $141 $298 MSDW S&P 500 INDEX $26 $81 $139 $294 MSDW SHORT-TERM BOND $28 $86 $146 $308 MSDW STRATEGIST $27 $82 $141 $298 MSDW UTILITIES $28 $87 $148 $313 MSDW EMERGING MARKETS EQUITY $40 $121 $203 $417 MSDW EQUITY GROWTH $30 $93 $157 $330 MSDW INTERNATIONAL MAGNUM $33 $102 $173 $360 MSDW MID-CAP VALUE $32 $99 $167 $350 MSDW U.S. REAL ESTATE $33 $100 $170 $354 PUTNAM GROWTH AND INCOME $28 $86 $147 $311 PUTNAM INTERNATIONAL GROWTH $34 $102 $173 $361 PUTNAM VOYAGER $29 $89 $151 $318 VAN KAMPEN EMERGING GROWTH $30 $93 $157 $330 INFORMATION FUND $29 $90 $153 $323
Replace the paragraph following "Example 2" with the following: PLEASE REMEMBER THAT YOU ARE LOOKING AT EXAMPLES AND NOT A REPRESENTATION OF PAST OR FUTURE EXPENSES. YOUR ACTUAL EXPENSES MAY BE LOWER OR GREATER THAN THOSE SHOWN ABOVE. SIMILARLY, YOUR RATE OF RETURN MAY BE LOWER OR GREATER THAN 5%, WHICH IS NOT GUARANTEED. THE ABOVE EXAMPLES ASSUME THE ELECTION OF BOTH THE ENHANCED EARNINGS DEATH BENEFIT OPTION AND THE INCOME AND DEATH BENEFIT COMBINATION OPTION 2, WITH A MORTALITY AND EXPENSE RISK CHARGE OF 1.95%. IF THOSE OPTIONS WERE NOT ELECTED, THE EXPENSE FIGURES SHOWN ABOVE WOULD BE SLIGHTLY LOWER. TO REFLECT THE CONTRACT MAINTENANCE CHARGE IN THE EXAMPLES, WE ESTIMATED AN EQUIVALENT PERCENTAGE CHARGE, BASED UPON AN ASSUMED AVERAGE CONTRACT SIZE OF $54,945. Page 15: Add the following to the third paragraph, as amended by the previous Supplement under the section entitled "Accumulation Unit Values:" Finally, we determine five additional sets of Accumulation Unit Values (sets 6-10) that reflect the cost of the Enhanced Earnings Death Benefit Option when selected alone and when selected along with each of the other death or income benefit options. Page 21: Replace the first sentence of the first paragraph under the section entitled "Mortality and Expense Risk Charge" with the following: We deduct a mortality and expense risk charge daily at an annual rate of 1.25% of the average daily net assets you have invested in the Variable Sub-Accounts (1.38% if you also select the Enhanced Death Benefit Option, the Performance Death Benefit Option, or the Performance Income Benefit Option, 1.49% if you select the Death Benefit Combination Option or the Performance Benefit Combination Option, 1.55% if you also select the Income Benefit Combination Option 2, and 1.75% if you also select the Income and Death Benefit Combination Option 2). If you select the Enhanced Earnings Death Benefit Option, we deduct a mortality and expense risk charge daily at an annual rate of 1.45% of average daily net assets you have invested in the Variable Sub-Accounts (1.58% if you also select the Enhanced Death Benefit Option, the Performance Death Benefit Option, or the Performance Income Benefit Option, 1.69% if you also select the Death Benefit Combination Option or the Performance Benefit Combination Option, 1.75% if you also select the Income Benefit Combination Option 2, or 1.95% if you also select the Income and Death Benefit Combination Option 2). Page 26: Replace the first paragraph under "Death Benefit Options" with the following: The Enhanced Death Benefit, the Performance Death Benefit, the Performance Benefit Combination, the Death Benefit Combination, the Income and Death Benefit Combination Option 2, and the Enhanced Earnings Death Benefit Option, are optional death benefits that you may elect. If the Contract owner is a natural person, these death benefit options apply only on the death of the Contract owner. If the Contract owner is not a natural person, these options apply only on the death of the Annuitant. For Contracts with a death benefit option, the death benefit will be the greater of Death Benefit Amounts (1) through (3) above, or (4) the death benefit option you selected. For Contracts with the Enhanced Earnings Death Benefit Option, the death benefit will be increased as described on page __ below. The death benefit options may not be available in all states. Page 26: Insert after the last paragraph under "Death Benefit Options:" ENHANCED EARNINGS DEATH BENEFIT OPTION. You may elect the Enhanced Earnings Death Benefit Option alone or together with any other death and/or income benefit option offered under the Contract. Under the Enhanced Earnings Death Benefit Option, if the oldest Contract owner (or the Annuitant if the Contract owner is a non-natural person) is age 69 or younger on the date we issue the rider for this option ("Rider Date"), the death benefit is increased by: o 40% of the lesser of the In-Force Premium or Death Benefit Earnings. If the oldest Contract owner (or the Annuitant if the Contract owner is a non-natural person) is between the ages of 70 and 79 on the Rider Date, the death benefit is increased by: o 25% of the lesser of the In-Force Premium or Death Benefit Earnings. For purpose of calculating the Enhanced Earnings Death Benefit, the following definitions apply: In-Force Premium equals the Contract Value on the Rider Date plus all purchase payments after the Rider Date less the sum of all Excess-of-Earnings Withdrawals after the Rider Date. If the Rider Date is the same as the Issue Date, then the Contract Value on the Rider Date is equal to your initial purchase payment. Death Benefit Earnings equal the Contract Value minus the In-Force Premium. The Death Benefit Earnings amount will never be less than zero. An Excess-of-Earnings Withdrawal is the amount of a withdrawal which is in excess of the Death Benefit Earnings in the Contract immediately prior to the withdrawal. We will calculate the Enhanced Earnings Death Benefit Option as of the date we receive Due Proof of Death. We will pay the Enhanced Earnings Death Benefit with the death benefit as described under "Death Benefit Payments" below. The value of the Enhanced Earnings Death Benefit depends largely on the amount of earnings that accumulate under your Contract. If you expect to withdraw the earnings from your Contract Value, electing the Enhanced Earnings Death Benefit Option may not be appropriate. For purposes of calculating the Enhanced Earnings Death Benefit, earnings are considered to be withdrawn first before purchase payments. Your Financial Advisor can help you decide if the Enhanced Earnings Death Benefit Option is right for you. For examples of how the death benefit is calculated under the Enhanced Earnings Death Benefit Option, see Appendix B. Page 27: Insert the following after the fourth sentence of the fourth paragraph under "Death Benefit Payments": If the Enhanced Earnings Death Benefit Option has been elected, on the date the contract is continued, the Rider Date for this Option is reset to the date the contract is continued. For purposes of calculating future death benefits, your spouse's age on this new Rider date of will be used to determine applicable death benefit amounts. Page __: Insert the following as Appendix B: CALCULATION OF ENHANCED EARNINGS DEATH BENEFIT EXAMPLE 1. In this example, assume that the oldest Owner is age 65 at the time the Contract is issued and elects the Enhanced Earnings Death Benefit Option when the Contract is issued. The Owner makes an initial purchase payment of $100,000. After four years, the Owner dies. On the date Northbrook receives Due Proof of Death, the Contract Value is $125,000. Prior to his death, the Owner did not make any additional purchase payments or take any withdrawals. Excess-of-Earnings Withdrawals = $0 In-Force Premium = $100,000 ($100,000 + $0 - $0) Death Benefit Earnings = $25,000 ($125,000 - $100,000) Enhanced Earnings Death Benefit = 40% x $25,000 = $10,000. Since Death Benefit Earnings are less than In-Force Premium, the Death Benefit Earnings are used to compute the Enhanced Earnings Death Benefit amount. EXAMPLE 2. In the second example, assume the same facts as above, except that the Owner has taken a withdrawal of $10,000 during the second year of the Contract. At the time the withdrawal is taken, the Contract Value is $105,000. Here, $5,000 of the withdrawal is in excess of the Death Benefit Earnings at the time of the withdrawal. The Contract Value on the date Northbrook receives due proof of death will be assumed to be $114,000. Excess of Earnings Withdrawals = $5,000 ($10,000 - $5,000) In-Force Premium = $95,000 ($100,000 + $0 - $5,000) Death Benefit Earnings = $19,000 ($114,000 - $95,000) Enhanced Earnings Death Benefit = 40% x $19,000 = $7,600. Since Death Benefit Earnings are less than In-Force Premium, the Death Benefit Earnings are used to compute the Enhanced Earnings Death Benefit amount. EXAMPLE 3. This third example is intended to illustrate the effect of adding the Enhanced Earnings Death Benefit Option after the Contract has been issued and the effect of later purchase payments. In this example, assume that the oldest Owner is age 75 at the time the Enhanced Earnings Death Benefit is elected. At the time the Contract is issued, the Owner makes a purchase payment of $100,000. After two years pass, the Owner elects to add the Enhanced Earnings Death Benefit Option. On the date this Option is added, the Contract Value is $110,000. Two years later, the Owner withdraws $50,000. Immediately prior to the withdrawal, the Contract Value is $130,000. Another two years later, the Owner makes an additional purchase payment of $40,000. A year later, the owner dies with a Contract Value of $140,000 on the date we receive Due Proof of Death. Excess of Earnings Withdrawals = $30,000 ($50,000 - $20,000) In-Force Premium = $120,000 ($110,000 + $40,000 - $30,000) Death Benefit Earnings = $20,000 ($140,000 - $120,000) Enhanced Earnings Death Benefit = 25% of $20,000 = $5,000. In this example, In-Force Premium is the Contract Value on the date the Rider was issued plus all later withdrawals and minus Excess-of-Earnings withdrawals. Since Death Benefit Earnings are less than In-Force Premium, the Death Benefit Earnings are used to compute the Enhanced Earnings Death Benefit amount. PART B NORTHBROOK LIFE INSURANCE COMPANY NORTHBROOK VARIABLE ANNUITY ACCOUNT II SUPPLEMENT, DATED DECEMBER 8, 2000, TO THE MORGAN STANLEY DEAN WITTER VARIABLE ANNUITY II STATEMENT OF ADDITIONAL INFORMATION DATED MAY 2, 2000 This supplement amends the statement of additional information, dated May 2, 2000, for the Morgan Stanley Dean Witter Variable Annuity II Contracts as follows: Under the section entitled "Standardized Total Returns", add the following separate paragraph immediately after the sixth paragraph: Contracts with the Enhanced Earnings Death Benefit Option were first offered to the public as of December 8, 2000. The Variable Sub-Accounts were available for investment prior to that date. Accordingly, performance figures for Variable Sub-Accounts for periods prior to the availability of the Enhanced Earnings Death Benefit Option reflect the historical performance of the Variable Sub-Accounts, adjusted to reflect the current charge for such features as if they had been available throughout the periods shown, as well as the withdrawal and contract maintenance charge. Add the following tables to the performance tables under "Standardized Total Returns": [Performance information to be provided in subsequent amendment.] (WITH THE ENHANCED EARNINGS DEATH BENEFIT OPTION)
10 Years or Variable Sub-Account One Year Five Years Since Inception ------------------------------------------- (WITH THE ENHANCED EARNINGS DEATH BENEFIT OPTION AND EITHER THE ENHANCED DEATH BENEFIT OPTION, THE PERFORMANCE DEATH BENEFIT OPTION, OR THE PERFORMANCE INCOME BENEFIT OPTION) 10 Years or Variable Sub-Account One Year Five Years Since Inception ------------------------------------------- (WITH THE ENHANCED EARNINGS DEATH BENEFIT OPTION AND EITHER THE PERFORMANCE DEATH BENEFIT OPTION OR THE DEATH BENEFIT COMBINATION OPTION) 10 Years or Variable Sub-Account One Year Five Years Since Inception ------------------------------------------- (WITH THE ENHANCED EARNINGS DEATH BENEFIT OPTION AND THE INCOME BENEFIT COMBINATION OPTION 2) 10 Years or Variable Sub-Account One Year Five Years Since Inception ------------------------------------------- (WITH THE ENHANCED EARNINGS DEATH BENEFIT OPTION AND THE INCOME AND DEATH BENEFIT COMBINATION OPTION 2) 10 Years or Variable Sub-Account One Year Five Years Since Inception -------------------------------------------
Add the following to the seventh paragraph under "Non-Standardized Total Returns": Contracts with the Enhanced Earnings Death Benefit Option were first offered to the public as of __________, 2000. The Variable Sub-Accounts were available for investment prior to that date. Accordingly, performance figures for Variable Sub-Accounts for periods prior to the availability of the Enhanced Earnings Death Benefit Option reflect the historical performance of the Variable Sub-Accounts, adjusted to reflect the current charge for this feature as if it had been available throughout the periods shown, excluding the withdrawal charge but including the contract maintenance charge. Add the following tables to the performance tables under "Non-Standardized Total Returns": [Performance information to be provided in subsequent amendment.] (WITH THE ENHANCED EARNINGS DEATH BENEFIT OPTION)
10 Years or Variable Sub-Account One Year Five Years Since Inception ------------------------------------------- (WITH THE ENHANCED EARNINGS DEATH BENEFIT OPTION AND EITHER THE ENHANCED DEATH BENEFIT OPTION, THE PERFORMANCE DEATH BENEFIT OPTION, OR THE PERFORMANCE INCOME BENEFIT OPTION) 10 Years or Variable Sub-Account One Year Five Years Since Inception ------------------------------------------- (WITH THE ENHANCED EARNINGS DEATH BENEFIT OPTION AND EITHER THE PERFORMANCE DEATH BENEFIT OPTION OR THE DEATH BENEFIT COMBINATION OPTION) 10 Years or Variable Sub-Account One Year Five Years Since Inception ------------------------------------------- (WITH THE ENHANCED EARNINGS DEATH BENEFIT OPTION AND THE INCOME BENEFIT COMBINATION OPTION 2) 10 Years or Variable Sub-Account One Year Five Years Since Inception ------------------------------------------- (WITH THE ENHANCED EARNINGS DEATH BENEFIT OPTION AND THE INCOME AND DEATH BENEFIT COMBINATION OPTION 2) 10 Years or Variable Sub-Account One Year Five Years Since Inception -------------------------------------------
Replace the second paragraph under "Adjusted Historical Total Returns" with the following: The adjusted historical total returns for the Variable Sub-Accounts for the periods ended December 31, 1999 are set out below. No adjusted historical total returns are shown for the Money Market Variable Sub-Account. Where the returns included in the following tables give effect to the Enhanced Earnings Death Benefit Option, the performance figures have been adjusted to reflect the current charge for the feature as if that feature had been available throughout the periods shown. Add the following tables to the performance tables under "Adjusted Historical Total Returns": [Performance information to be provided in subsequent amendment.]
(WITH THE ENHANCED EARNINGS DEATH BENEFIT OPTION) 10 Years or Variable Sub-Account One Year Five Years Since Inception ------------------------------------------- (WITH THE ENHANCED EARNINGS DEATH BENEFIT OPTION AND EITHER THE ENHANCED DEATH BENEFIT OPTION, THE PERFORMANCE DEATH BENEFIT OPTION, OR THE PERFORMANCE INCOME BENEFIT OPTION) 10 Years or Variable Sub-Account One Year Five Years Since Inception ------------------------------------------- (WITH THE ENHANCED EARNINGS DEATH BENEFIT OPTION AND EITHER THE PERFORMANCE DEATH BENEFIT OPTION OR THE DEATH BENEFIT COMBINATION OPTION) 10 Years or Variable Sub-Account One Year Five Years Since Inception ------------------------------------------- (WITH THE ENHANCED EARNINGS DEATH BENEFIT OPTION AND THE INCOME BENEFIT COMBINATION OPTION 2) 10 Years or Variable Sub-Account One Year Five Years Since Inception ------------------------------------------- (WITH THE ENHANCED EARNINGS DEATH BENEFIT OPTION AND THE INCOME AND DEATH BENEFIT COMBINATION OPTION 2) 10 Years or Variable Sub-Account One Year Five Years Since Inception -------------------------------------------
PART C Part C is hereby amended to include the following exhibits: Item 24(b). EXHIBITS (4)(f) Enhanced Earnings Death Benefit Rider (9)(d) Opinion and Consent of General Counsel (10)(a) Consent of Independent Auditors * (10)(b) Consent of Outside Counsel * (13)(d) Performance Data Calculations * * To be included in subsequent amendment. SIGNATURES As required by the Securities Act of 1933 and the Investment Company Act of 1940, the Registrant has caused this Registration Statement, as amended, to be signed on its behalf by the undersigned, thereunto duly authorized, all in the Township of Northbrook, State of Illinois, on the 6th day of November, 2000. NORTHBROOK VARIABLE ANNUITY ACCOUNT II (REGISTRANT) BY: NORTHBROOK LIFE INSURANCE COMPANY (DEPOSITOR) By: /s/MICHAEL J. VELOTTA -------------------------- Michael J. Velotta Vice President, Secretary and General Counsel As required by the Securities Act of 1933, this Registration Statement, as amended, has been duly signed below by the following Directors and Officers of Northbrook Life Insurance Company on the 6th day of November, 2000.
*/THOMAS J. WILSON, II Director, President and Chief Executive - ---------------------- Officer Thomas J. Wilson, II /s/ MICHAEL J. VELOTTA Director, Vice President, Secretary and - ------------------------------ General Counsel Michael J. Velotta */MARGARET G. DYER Director - ---------------------- Margaret G. Dyer */ MARLA G. FRIEDMAN Director and Vice President - ---------------------- Marla G. Friedman */JOHN C. LOUNDS Director - ---------------------- John C. Lounds */J. KEVIN McCARTHY Director - ---------------------- J. Kevin McCarthy */STEVEN C. VERNEY Director - ---------------------- Steven C. Verney */SAMUEL H. PILCH Vice President and Controller - ---------------------- Samuel H. Pilch */CASEY J. SYLLA Chief Investment Officer - ---------------------- Casey J. Sylla
*/ By Michael J. Velotta, pursuant to Power of Attorney, filed in Registrant's Registration Statement (File no. 333-43086). EXHIBIT LIST - ------------------------------------------------------------------------------- The following exhibits are filed herewith: - ------------------------------------------------------------------------------- EXHIBIT NO. DESCRIPTION (4)(f) Enhanced Earnings Death Benefit Rider (9)(d) Opinion and Consent of General Counsel (10)(a) Consent of Independent Auditors * (10)(b) Consent of Outside Counsel * (13)(d) Performance Data Calculations * * To be filed by subsequent amendment. EX-4 2 0002.txt FORM OF ENHANCED EARNINGS DEATH BENEFIT RIDER NLU940 NORTHBROOK LIFE INSURANCE COMPANY (herein called "we" or "us") Enhanced Earnings Death Benefit Rider This rider was issued because you selected the Enhanced Earnings Death Benefit Rider. For purposes of this benefit "Rider Date" is the date the Enhanced Earnings Death Benefit Rider was made a part of the Contract: xx/xx/xxxx As used in this rider: o Contract: The Contract or Certificate to which this rider is attached. o Death Benefit Earnings: The greater of (a) the current Cash Value less the In-Force Premium; or (b) zero. o In-Force Premium: o If the Rider Date is equal to the Contract Date: o The sum of all the purchase payments less the sum of all the Excess-of-Earnings Withdrawals. o If the Rider Date is later than the Contract Date: o The Cash Value as of the Rider Date plus all the purchase payments after the Rider Date less the sum of all the Excess-of-Earnings Withdrawals after the Rider Date. o Excess-of-Earnings Withdrawals: For each withdrawal, this amount is equal to the excess, if any, of the amount of the withdrawal less the amount of Death Benefit Earnings in the Contract immediately prior to the withdrawal. The following provision is added to the Contract. 1. Under this rider, if the oldest Owner, or the Annuitant if the Owner is a non-natural person, is age 69 or younger on the Rider Date, the Enhanced Earnings Death Benefit will be: o 40% of the lesser of the In-Force Premium or Death Benefit Earnings, calculated as of the date we receive due proof of death. If the oldest Owner, or the Annuitant if the Owner is a non-natural person, is between the ages of 70 and 79 on the Rider Date, the Enhanced Earnings Death Benefit will be: o 25% of the lesser of the In-Force Premium or Death Benefit Earnings, calculated as of the date we receive due proof of death. If the Owner is a Natural Person, the Enhanced Earnings Death Benefit is payable upon the death of the Owner. If the Owner is not a Natural Person, the Enhanced Earnings Death Benefit is payable on the death of the Annuitant. II. The Mortality and Expense Risk Charge provision of the Contract is modified as follows: On and after the Rider Date, the maximum annualized Mortality and Expense Risk Charge is increased by 0.20% for this rider. Except as amended by this rider, the Contract remains unchanged. [GRAPHIC OMITTED][GRAPHIC OMITTED] Michael J. Velotta Thomas J. Wilson Secretary Chairman and Chief Executive Officer NLU940 (8/00) EX-9 3 0003.txt OPINION AND CONSENT OF GENERAL COUNSEL NORTHBROOK LIFE INSURANCE COMPANY LAW AND REGULATION DEPARTMENT 3100 Sanders Road, J5B Northbrook, Illinois 60062 Direct Dial Number 847-402-2400 Facsimile 847-402-4371 Michael J. Velotta Senior Vice President, Secretary and General Counsel November 6, 2000 TO: NORTHBROOK LIFE INSURANCE COMPANY NORTHBROOK, ILLINOIS 60062 FROM: MICHAEL J. VELOTTA SENIOR VICE PRESIDENT, SECRETARY AND GENERAL COUNSEL RE: FORM N-4 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 AND THE INVESTMENT COMPANY ACT OF 1940 FILES NOS. 333-35412 and 811-06116 With reference to the above mentioned Registration Statement on Form N-4 ("Registration Statement") filed by Northbrook Life Insurance Company ("the Company"), as depositor, and Northbrook Variable Annuity Account II, as registrant, with the Securities and Exchange Commission described therein, I have examined such documents and such law as I have considered necessary and appropriate, and on the basis of such examination, it is my opinion that as of November 6, 2000: 1. The Company is duly organized and existing under the laws of the State of Illinois and has been duly authorized to do business by the Director of Insurance of the State of Illinois. 2. The securities registered by the Registration Statement when issued will be valid, legal and binding obligations of the Company. I hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the use of my name under the caption "Legal Matters" in the Prospectuses constituting a part of the Registration Statement. Sincerely, ---------------------- Michael J. Velotta Senior Vice President, Secretary and General Counsel -----END PRIVACY-ENHANCED MESSAGE-----