SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act
of 1934 (Amendment No. )
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Filed by the Registrant: [X]
Filed by a Party other than the Registrant: [ ]
Check the appropriate box:
[X] Preliminary Proxy Statement [ ] Confidential, For Use of the
Commission Only (as permitted
by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Under Rule 14a-12
New England Variable Annuity Fund I
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
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[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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NEW ENGLAND VARIABLE ANNUITY FUND I
NOTICE OF SPECIAL MEETING
OF CONTRACTHOLDERS
October 25, 2002
To the Contractholders:
Notice is hereby given that a Special Meeting of Contractholders of New
England Variable Annuity Fund I (the "Fund") will be held at the offices of New
England Life Insurance Company ("New England Financial"), 501 Boylston Street,
Boston, Massachusetts 02116, on October 25, 2002 at 2:00 p.m. (Boston time) for
the following purposes:
1. To approve the change in classification of the Fund under the Investment
Company Act of 1940, as amended, from an open-end management investment
company to a unit investment trust.
2. To consider and act upon any other matters which may properly come
before the meeting or any adjournment thereof.
By order of the President,
Thomas M. Lenz,
Secretary
September 10, 2002
YOUR VOTE IS IMPORTANT
PLEASE FILL IN, DATE, SIGN AND RETURN THE ENCLOSED INSTRUCTION FORM PROMPTLY IN
THE ENCLOSED POSTAGE-PAID ENVELOPE WHETHER OR NOT YOU PLAN TO BE PRESENT AT THE
MEETING. YOU MAY STILL VOTE IN PERSON IF YOU ATTEND THE MEETING.
NEW ENGLAND VARIABLE ANNUITY FUND I
501 BOYLSTON STREET
BOSTON, MASSACHUSETTS 02116
PROXY STATEMENT
The enclosed Proxy is solicited on behalf of the Board of Managers of New
England Variable Annuity Fund I (the "Fund") for use at the Special Meeting of
Contractholders of the Fund called to be held at the offices of New England
Life Insurance Company ("New England Financial"), 501 Boylston Street, Boston,
Massachusetts 02116 on October 25, 2002 at 2:00 p.m. (Boston time) and at any
adjournment or adjournments thereof (the "Meeting"). The Fund is a separate
account of Metropolitan Life Insurance Company (the "Company").
This statement and its enclosures are being mailed to Contractholders
beginning on or about September 10, 2002. A copy of the 2001 Annual Report to
Contractholders and the Fund's semiannual report for the six months ended June
30, 2002 may be obtained without charge from New England Financial by writing
to the above address or by calling (800) 356-5015.
This Proxy Statement consists of two parts.
PART I contains information relating to Proposal 1, the proposal to approve
the change in classification of the Fund under the Investment Company Act of
1940, as amended (the "1940 Act"), from an open-end management investment
company to a unit investment trust (the "Reclassification").
PART II contains information about the Fund and other matters.
Each timely, properly executed proxy will be voted as you instruct. If no
choice is indicated, the proxy will be voted in favor of Proposal 1 set forth
in the attached Notice of Meeting (the "Proposal"). At any time before it has
been voted, the enclosed proxy may be revoked by the signer by a written
revocation received by the Secretary of the Board of Managers of the Fund (c/o
New England Variable Annuity Fund I, 501 Boylston Street, Boston,
Massachusetts, 02116), by properly executing a later-dated proxy or by
attending the Meeting, requesting return of the proxy and voting in person.
Proxies will be solicited primarily by mailing this Proxy Statement and its
enclosures beginning on or about September 10, 2002, but supplementary
solicitations may also be made by personal interview, mail, telephone and
e-mail by officers or Managers of the Fund or by officers, employees or agents
of New England Financial, which supplies administrative services to the Fund,
and its subsidiaries. Proxy Services Corporation has been engaged to assist in
the solicitation of proxies, at an estimated cost of $8,060. The entire cost of
the solicitation will be borne by the Company.
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VOTING
The Board of Managers of the Fund has fixed the close of business on July
31, 2002 as the record date (the "Record Date") for determination of the
Contractholders entitled to receive notice of and to vote at the Meeting and of
the number of votes to which such persons are entitled.
Each Contractholder at the close of business on the Record Date is entitled
to cast at the Meeting the number of votes attributable to its contract on such
Record Date. The number of votes that the Contractholder is entitled to cast is
shown on the Proxy. The number of votes which a Contractholder may cast on a
contract in the accumulation period is equal to the number of accumulation
units standing to the credit of the contract. During the annuity period a
Contractholder may cast the number of votes equal to (i) the amount of assets
established in the Fund to meet the obligation for future payments under
variable options elected under the contract divided by (ii) the value of an
accumulation unit. (Fractional units are counted.) Based on the foregoing,
there are 1,515,791.31679 votes eligible to be cast by Contractholders at the
Meeting.
All notices and proxy materials will be provided to the Contractholders,
including such number as necessary to enable each Contractholder to distribute
copies to any persons who have the right to instruct such Contractholder with
respect to votes attributable to such Contractholder's contract. Neither the
Fund, New England Financial nor the Company shall be under a duty to inquire as
to (1) the receipt by a Contractholder of instructions from persons, if any,
who may have the right to instruct the Contractholder with respect to votes
attributable to the Contractholder's contract, (2) the validity or effect of
any voting instructions received by a Contractholder or (3) the authority of
the Contractholder to cast votes. Except to the extent that the Fund, New
England Financial or the Company has actual knowledge to the contrary, the
votes cast by the Contractholders shall be valid and effective as they affect
the Fund, New England Financial, the Company and any others having voting
rights with respect to the Fund.
I. THE RECLASSIFICATION
At present, the Fund is a separate account classified as an open-end
diversified management investment company under the 1940 Act. The Fund was
established in 1969 as an investment vehicle for variable annuity contracts of
individuals and certain retirement plans. The Fund no longer offers new
contracts, but certain Contractholders may continue to make payments under
existing contracts. The Fund is managed by a Board of Managers in accordance
with the Fund's Rules and Regulations.
The investment objective of the Fund is to seek to equal the performance of
the Standard & Poor's 500 Composite Stock Price Index ("S&P 500 Index") before
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expenses. The Fund pursues its investment objective by investing all of its
assets in shares of the MetLife Stock Index Portfolio (the "Portfolio"), a
series of the Metropolitan Series Fund, Inc. (the "Met Series Fund"), an
open-end diversified management investment company registered under the 1940
Act. Similar to the investment objective of the Fund, the investment objective
of the Portfolio is to equal the performance of the S&P 500 Index.
The Fund does not engage an investment adviser but indirectly bears the
investment advisory fees and other expenses of the Portfolio in proportion to
the Fund's assets invested in the Portfolio. MetLife Advisers, LLC ("MetLife
Advisers") serves as the investment adviser to each series of the Met Series
Fund, including the Portfolio. An indirect wholly-owned subsidiary of the
Company owns all of the voting securities of MetLife Advisers. The Company is
responsible for the day-to-day portfolio management of the Portfolio pursuant
to a subadvisory agreement between MetLife Advisers and the Company. The Met
Series Fund is managed by its own Board of Directors. Shares of the Portfolio
are offered to separate accounts of the Company and its affiliated insurance
companies and to certain eligible qualified retirement plans.
Prior to May 1, 2002, the Fund engaged an investment adviser that invested
the assets of the Fund directly in a portfolio of securities. Effective May 1,
2002, the Board of Managers approved the termination of the Fund's investment
advisory agreement and the change in the Fund's structure to a feeder fund that
invests all of its assets in the Portfolio.
Generally, insurance company separate accounts that support variable annuity
contracts offered to the public are classified under the 1940 Act either as
open-end management companies ("Managed Accounts") or unit investment trusts.
Managed Accounts typically invest directly in an actively managed portfolio of
securities and are supervised by a board of managers. Separate accounts
classified as unit investment trusts do not have a board of managers and
typically invest in the securities of another actively managed investment
company. One of the primary functions performed by the board of managers of a
Managed Account is the approval and oversight of the investment adviser and its
management of the account's portfolio of securities. As the Fund no longer
engages an investment adviser or invests directly in a portfolio of securities,
the Board of Managers is proposing to change the classification of the Fund
under the 1940 Act from a management investment company to a unit investment
trust.
Consequences of the Reclassification
If the Reclassification is approved, a Contractholder's interest in the Fund
will have a value identical to the Contractholder's interest in the Fund before
the Reclassification. The Reclassification will not affect Contractholders'
benefits
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under the contracts. The Company believes that the Reclassification will not
result in adverse tax consequences to Contractholders. The Company will pay all
costs and expenses associated with effecting the Reclassification.
After the proposed Reclassification, the Fund will no longer be managed by a
Board of Managers, and the Board of Managers will cease to exist. The Fund will
continue to invest all of its assets in the Portfolio, which is managed by its
own Board of Directors. The members of the Board of Directors of the Portfolio,
other than the Chair of the Board, Anne M. Goggin, are different from the
members of the Board of Managers of the Fund. As is presently the case, the
Fund will not engage an investment adviser but will indirectly incur investment
advisory fees of the Portfolio and other expenses related to the operation of
the Portfolio. The aggregated fees and expenses of the Fund (including those
borne indirectly by the Fund as a shareholder of the Portfolio) are not
expected to increase as a result of the Reclassification. If the
Reclassification is approved, the Company has undertaken to bear certain Fund
expenses to ensure that Fund expenses borne by Contractholders after the
Reclassification (other than brokerage commissions, if any, and certain taxes),
including expenses borne indirectly by the Fund as a shareholder of the
Portfolio, do not exceed the annual rate of .3066% of the Fund's net assets,
which is the level of Fund expenses currently borne by Contractholders. Thus,
the Reclassification is not expected to result in any changes in the level of
expenses borne by Contractholders.
Contractholders will continue to have the right to vote directly at any
meeting of Contractholders with respect to matters relating to the Fund and
will be entitled to give voting instructions with respect to matters submitted
to a shareholder vote of the Portfolio.
It is anticipated that the Reclassification will occur on or around November
1, 2002, or as soon thereafter as practicable following Contractholder approval.
Because the Reclassification will result in the elimination of the Board of
Managers, the Board of Managers has approved certain changes in the Rules and
Regulations of the Fund to eliminate references to functions performed by the
Board of Managers. One of these changes, to Article IV. of the Rules and
Regulations, relating to indemnification of the Board of Managers and officers
of the Fund, requires Contractholder approval. Set forth below is the text of
Article IV., as proposed to be amended (with deleted language stricken through
and added language underlined*):
ARTICLE IV. INDEMNIFICATION*
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The Fund shall indemnify each of the members of its Board of Managers and
officers (including persons who serve at its request as
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* IN THIS EDGAR FILING, ARTICLE IV. INDEMNIFICATION, ADDITIONS APPEAR
AS UNDERLINED, CAPITALIZED TEXT AND DELETIONS APPEAR UNDERLINED INSIDE
PARENTHESES.
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directors, officers or trustees of another organization in which it has any
interest, as a shareholder, creditor or otherwise) against all liabilities
and expenses, including but not limited to amounts paid in satisfaction of
judgments, in compromise or as fines and penalties, and counsel fees
reasonably incurred by him in connection with the defense or disposition of
any action, suit or other proceeding, whether civil or criminal, before any
court or administrative or legislative body, in which he may be or may have
been involved as a party or otherwise or with which he may be or may have
been threatened, while in office or thereafter, by reason of any alleged act
or omission as a member or officer or by reason of his being or having been
such a member or officer, except with respect to any matter as to which he
shall have been finally adjudicated in any such action, suit or other
proceeding not to have acted in good faith in the reasonable belief that his
action was in the best interests of the Fund and except that no member or
officer shall be indemnified against any liability to the Fund or its
Contractholders to which he would otherwise be subject by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of his office. Expenses, including counsel fees, so
incurred by any such member or officer may be paid by the Fund in advance of
the final disposition of any such action, suit or proceeding on the
condition that the amounts so paid shall be repaid to the Fund if it is
ultimately determined that indemnification of such expenses is not
authorized under this Article.
As to any matter disposed of by a compromise payment by such member or
officer, pursuant to a consent decree or otherwise, no such indemnification
either for said payment or for any other expenses shall be provided unless
such compromise shall be approved as in the best interests of the Fund(,
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after notice that it involves such indemnification, (a) by a disinterested
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majority of the members of the Board of Managers then in office; or (b) by a
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majority of the disinterested members of the Board of Managers then in
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office; or (c)) by any disinterested person or persons to whom the question
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may be referred by the (Board of Managers) COMPANY, provided that (in the
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case of approval pursuant to clause (b) or (c)) there has been obtained an
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opinion in writing of independent legal counsel to the effect that such
member or officer appears to have acted in good faith in the reasonable
belief that his action was in the best interests of the Fund and that such
indemnification would not protect such member or officer against any
liability to the Fund or its Contractholders to which he would otherwise be
subject by reason of willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of his office(; or
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(d) by the Contractholders holding a majority of the votes at the time
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entitled to vote for members of the Board of Managers, exclusive of the
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votes of any interested member or
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officer). Approval by (the Board of Managers pursuant to clause (a) or (b) or
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by) any disinterested person or persons pursuant to clause (c) of this
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paragraph shall not prevent the recovery from any officer or member of any
amount paid to him in accordance with (either of such clauses) THIS PARAGRAPH
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as indemnification if such officer or member is subsequently adjudicated by
a court of competent jurisdiction not to have acted in good faith in the
reasonable belief that his action was in the best interests of the Fund or
to have been liable to the Fund or its Contractholders by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of his office.
The right of indemnification hereby provided shall not be exclusive of or
affect any other rights to which any member of the Board of Managers or
officer may be entitled. As used in this Article, the terms "member" and
"officer" include their respective heirs, executors and administrators, and
an "interested" member or officer is one against whom the action, suit or
other proceeding in question or another action, suit or other proceeding on
the same or similar grounds is then or had been pending, and a
"disinterested person" is a person against whom none of such actions, suits
or other proceedings or another action, suit or other proceeding on the same
or similar grounds is then or had been pending. Nothing contained in this
Article shall affect any rights to indemnification to which Fund personnel
other than members and officers may be entitled by contract or otherwise
under law.
If Contractholders approve the Reclassification, the Fund will deem the
Contractholders to have approved this amendment to Article IV of the Rules and
Regulations. Such amendment will take effect only if the Reclassification
occurs.
Consideration by the Board of Managers
The Board of Managers of the Fund, including those members who are not
"interested persons" of the Fund, approved the Reclassification. The material
factors that the Managers considered included:
. The asset base of the Fund is not expected to increase substantially in
the future because no new contracts are being sold (although payments
continue to be accepted on existing contracts).
. The Fund no longer engages an investment adviser or invests directly in
a portfolio of securities.
. Because of the Fund's declining asset base, administration costs of the
Fund cannot benefit from economies of scale.
The Board of Managers also considered that the charges under the contracts
would not increase as a result of the Reclassification. After careful
consideration,
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the Managers believe that the change in classification of the Fund is in the
best interests of Contractholders.
MANAGER RECOMMENDATION
THE BOARD OF MANAGERS OF THE FUND RECOMMENDS THAT THE CONTRACTHOLDERS VOTE
TO APPROVE THE RECLASSIFICATION.
Required Vote. The required vote for approval of the Reclassification is
the lesser of (1) 67% of the votes present (in person or by proxy) and entitled
to be cast at the Meeting, if more than 50% of the outstanding votes of the
Fund are present (in person or by proxy) at the Meeting, or (2) more than 50%
of the votes entitled to be cast at the Meeting.
If the Contractholders do not approve the Proposal, the Board of Managers
will consider what other possible courses of action may be in the best
interests of Contractholders.
II. OTHER MATTERS
Votes cast by proxy or in person at the Meeting will be counted by persons
appointed by the Fund as tellers of the Meeting. With respect to the Proposal,
abstentions from voting will have the effect of a negative vote in the Proposal.
In the event that sufficient votes in favor of the Proposal are not received
by October 25, 2002, the persons named as proxies may vote on those matters as
to which sufficient votes have been received and may propose one or more
adjournments of the Meeting to permit further solicitation of proxies. Any such
adjournment will require the affirmative vote of a majority of the voting
interest present in person or by proxy at the session of the Meeting to be
adjourned. The persons named as proxies will vote in favor of such adjournment
those proxies which they are entitled to vote in favor of the Proposal. They
will vote against any such adjournment those proxies required to be voted
against the Proposal and will not vote any proxies that direct them to abstain
from voting on the Proposal.
New England Financial and the Company have informed the Fund that, as of the
Record Date, there were no persons owning contracts which would entitle them to
instruct the Company with respect to more than 5% of the voting securities of
the Fund. The Fund has been informed that, as of the Record Date, the officers
and Managers beneficially owned less than 1% of the outstanding shares of the
Fund.
Although the Meeting is called to transact any other business that may
properly come before it, the only business that the Board of Managers intends
to present or knows that others will present is the Proposal mentioned in the
Notice of Special Meeting. However, you are being asked on the enclosed proxy
to authorize
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the persons named therein to vote in accordance with their judgment with
respect to any additional matters which properly come before the Meeting, and
on all matters incidental to the conduct of the Meeting.
New England Securities Corporation, 501 Boylston Street, Boston,
Massachusetts 02116, is the Fund's principal underwriter. The address of New
England Financial is 501 Boylston Street, Boston, Massachusetts 02116. The
address of the Company is One Madison Avenue, New York, New York 10010.
Contractholder proposals will be included in the Fund's proxy material for
any future meetings of Contractholders of the Fund provided that they are
received by the Fund within a reasonable time before the Fund solicits proxies
relating to such future meetings, and provided that they are otherwise
appropriate for inclusion.
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THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
MANAGERS OF NEW ENGLAND VARIABLE ANNUITY FUND I.
The undersigned hereby appoints Thomas M. Lenz, Marie C. Swift and Michele
Abate and each of them, with power of substitution, or if only one of them is
present and voting then that one, proxies of the undersigned, to cast the number
of votes to which the undersigned is entitled as Contractholder, at the Special
Meeting of Contractholders of New England Variable Annuity Fund I (the "Fund")
to be held at the offices of New England Financial, 501 Boylston Street, Boston,
Massachusetts on October 25, 2002 at 2:00 p.m. and at any adjournment thereof.
The proxies are hereby authorized and instructed as set forth to vote upon
the matter specified. The proxies may vote in their discretion on any other
matter which may properly come before the meeting. IF THIS FORM IS SIGNED AND
RETURNED WITH NO CHOICES INDICATED SUCH SHARES SHALL BE VOTED FOR THE PROPOSAL.
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YOUR VOTE IS IMPORTANT. PLEASE VOTE AS SOON AS POSSIBLE.
PLEASE SEE REVERSE SIDE.
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Please mark
your vote as indicated in
this example.
X
THE BOARD OF MANAGERS RECOMMENDS A VOTE FOR THE PROPOSAL BELOW.
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IF NO SPECIFICATION IS MADE FOR THE PROPOSAL, THE PROXY SHALL BE VOTED FOR
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THE PROPOSAL.
1. To approve the change in classification of the Fund under the Investment
Company Act of 1940, as amended, from an open-end management investment
company to a unit investment trust.
FOR AGAINST ABSTAIN
NOTE: Please sign exactly as your name appears on this Proxy. When signing in a
fiduciary capacity, such as executor, administrator, trustee, attorney,
guardian, etc, please so indicate.
Corporate and partnership proxies should be signed by an authorized person
indicating the person's title.
Date , 2002
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Signature(s), Title(s), (if applicable)
PLEASE SIGN, DATE, AND RETURN PROMPTLY IN ENCLOSED ENVELOPE.
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VOTE BY TELEPHONE
QUICK *** EASY *** IMMEDIATE
Your telephone vote authorizes the named proxies to vote your shares in the same
manner as if you marked, signed and returned your instruction form.
VOTE BY PHONE: You will be asked to enter a Control Number located in the box
in the lower right of this form.
OPTION A: To vote as the Board of Managers recommends on the proposal: Press 1.
OPTION B: If you choose to vote differently press 0. You will hear these
instructions:
Item 1: To vote FOR, press 1; AGAINST, press 9; ABSTAIN, press 0.
WHEN ASKED, PLEASE CONFIRM YOUR VOTE BY PRESSING 1.
IF YOU VOTE BY PHONE - DO NOT MAIL THE PROXY CARD.
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THANK YOU FOR VOTING.
CALL * * TOLL FREE * * ON A TOUCH TONE TELEPHONE
1-888-457-2958 - ANYTIME
THERE IS NO CHARGE TO YOU FOR THIS CALL.
CONTROL NUMBER
FOR TELEPHONE VOTING
NEW ENGLAND VARIABLE ANNUITY FUND I
PROXY FOR THE SPECIAL MEETING OF CONTRACTHOLDERS
OCTOBER 25, 2002