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
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<Table>
[ ] Preliminary proxy statement.
[ ] Confidential, for use of the Commission Only (as permitted by Rule 14a-6(e)(2)).
[X] Definitive proxy statement.
[ ] Definitive additional materials.
[ ] Soliciting material pursuant under Rule 14a-12.
</Table>
MERRILL LYNCH VARIABLE LIFE SEPARATE ACCOUNT
MERRILL LYNCH LIFE VARIABLE ANNUITY SEPARATE ACCOUNT A
ML OF NEW YORK VARIABLE ANNUITY SEPARATE ACCOUNT A
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in its Charter)
MERRILL LYNCH LIFE INSURANCE COMPANY
ML LIFE INSURANCE COMPANY OF NEW YORK
- --------------------------------------------------------------------------------
(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: N/A
----------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies: N/A
----------------------------------------------------------------------
(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): N/A
----------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction: N/A
----------------------------------------------------------------------
(5) Total fee paid: $0
----------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
[ ] 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: N/A
----------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.: N/A
----------------------------------------------------------------------
(3) Filing Party: N/A
----------------------------------------------------------------------
(4) Date Filed: N/A
----------------------------------------------------------------------
MERRILL LYNCH LIFE INSURANCE COMPANY
ML LIFE INSURANCE COMPANY OF NEW YORK
October 10, 2003
Dear Contract Owner:
You own a variable life insurance contract or variable annuity contract
issued by Merrill Lynch Life Insurance Company or ML Life Insurance Company of
New York. You currently have contract value allocated to the MFS Investors Trust
Series, and we are seeking your approval to substitute shares of the
Roszel/PIMCO CCM Capital Appreciation Portfolio (a portfolio of the MLIG
Variable Insurance Trust) for shares of the MFS Investors Trust Series. We
strive to offer strong, attractive underlying investment options to our contract
owners, and the investment options that we offer are subject to regular reviews.
We review investment performance, evaluate the investment process, and assess
the portfolio management teams that manage the underlying investment options. It
is our opinion, based on such reviews, that the Roszel/PIMCO CCM Capital
Appreciation Portfolio offers a better alternative for contract owners who want
exposure to large-cap U.S. stocks. We believe the proposed substitution also
will make our variable contracts more efficient to administer and oversee, and
therefore more attractive to our customers.
To make the substitution, we must obtain the approval of the Securities and
Exchange Commission and of contract owners who have contract value invested in
the MFS Investors Trust Series as of September 12, 2003. We ask that you vote
for the proposed substitution. You can vote several ways: (1) by completing,
signing, and dating the enclosed Voting Form and returning it to Management
Information Services at 60 Research Road, Hingham, Massachusetts 02043 in the
enclosed postage-paid return envelope; (2) by calling 1-800-690-6903; or (3) on
the web at https://www.proxyweb.com. We must receive your voting instructions no
later than 4:00 p.m. (Eastern Time) on Friday, November 7, 2003. Georgeson
Shareholder Communications Inc. ("Georgeson") is assisting us in soliciting
votes. If you have any questions about this proxy solicitation, please call
Georgeson at 1-866-614-4480.
Please read carefully the enclosed Voting Information Statement for details
about the proposed substitution. Your vote and participation are very important,
and we appreciate receipt of your voting instructions as soon as possible. Thank
you for your cooperation.
Very truly yours,
/s/ NIKOS KARDASSIS
--------------------------------------
Nikos Kardassis
President and Chief Executive Officer
Merrill Lynch Insurance Group, Inc.
MERRILL LYNCH LIFE INSURANCE COMPANY
Merrill Lynch Variable Life Separate Account
Merrill Lynch Life Variable Annuity Separate Account A
1300 Merrill Lynch Drive, 2nd Floor
Pennington, New Jersey 08534
ML LIFE INSURANCE COMPANY OF NEW YORK
ML of New York Variable Annuity Separate Account A
2 World Financial Center
South Tower, 5th Floor
New York, New York 10281
VOTING INFORMATION STATEMENT
October 10, 2003
Merrill Lynch Life Insurance Company ("MLLIC"), on behalf of Merrill Lynch
Variable Life Separate Account and Merrill Lynch Life Variable Annuity Separate
Account A, each separate accounts of MLLIC, and ML Life Insurance Company of New
York ("MLNY"; together with MLLIC, the "Companies" or each a "Company"), on
behalf of ML of New York Variable Annuity Separate Account A, a separate account
of MLNY (except for MLLIC and MLNY, each a "Separate Account" and collectively,
the "Separate Accounts"), are furnishing this Voting Information Statement to
solicit votes from owners of variable life insurance and variable annuity
contracts (the "Variable Contracts") issued by MLLIC and MLNY having contract
value allocated on September 12, 2003 (the "Record Date") to the subaccounts of
the Separate Accounts that invest in Initial Class shares of the MFS Investors
Trust Series, a separate investment portfolio of the MFS(R) Variable Insurance
Trust(SM) ("MFS Trust"). This Voting Information Statement and the accompanying
Voting Form are being furnished to owners of Variable Contracts ("Owners") on or
about October 10, 2003.
The Companies are requesting a vote to approve or disapprove the following
proposal:
- The substitution of shares of the Roszel/PIMCO CCM Capital
Appreciation Portfolio, a separate investment portfolio of the MLIG
Variable Insurance Trust (the "MLIG Trust"), for Initial Class
shares of the MFS Investors Trust Series of the MFS Trust (the
"Substitution").
(The MFS Investors Trust Series is referred to herein as the "Substituted
Portfolio." The Roszel/PIMCO CCM Capital Appreciation Portfolio is referred to
herein as the "Replacement Portfolio." The subaccounts of the Separate Accounts
that invest in the Substituted Portfolio prior to the Substitution, and that
will invest in the Replacement Portfolio after the Substitution, are referred to
herein as the "Subaccounts" and each as a "Subaccount.")
As an Owner having contract value in the Subaccount of the Separate Account
supporting your Variable Contract as of the close of business on the Record
Date, you are entitled to vote such contract value on the above Substitution.
Under the Variable Contracts and all of the prospectuses for the Variable
Contracts, the Companies have reserved the right to substitute shares of one
portfolio for shares of another, including a portfolio of a different investment
company. The Companies' ability to carry out the proposed Substitution is
conditioned on them obtaining, for each class of Variable Contracts, the
approval of the Securities and Exchange Commission (the "Commission"). The
Commission's approval of the proposed Substitution is subject to certain
conditions, including that the Companies receive, for each class of Variable
Contracts, requisite approval from Owners entitled to vote (i.e., those Owners
who have contract value invested in the Substituted Portfolio as of the Record
Date). Each class of Variable Contracts consists of all Variable Contracts
issued through a single Separate Account.
1
GENERAL VOTING INFORMATION
An Owner is entitled to one vote for each dollar of contract value
(referred to herein as a "unit") that the Owner owns in a Subaccount. As of the
Record Date, the total number of units held in each Subaccount for each class of
Variable Contracts and entitled to vote was as follows:
<Table>
<Caption>
CLASS OF VARIABLE CONTRACT NUMBER OF UNITS ELIGIBLE TO VOTE
- ----------------------------------------------- --------------------------------
MLLIC Retirement Power and Retirement Optimizer 7,533,997.38
MLNY Retirement Power and Retirement Optimizer 410,457.38
MLLIC Legacy Power 121,567.97
</Table>
Unless extended by the Companies, votes must be received by November 7,
2003 to be counted. Approval will be obtained from each class of Variable
Contracts by the affirmative vote of the lesser of: (1) a majority of the
outstanding units for the Subaccount as of the Record Date, or (2) 67% of such
outstanding units voted, if votes received represent a majority of such units as
of the Record Date. If the Companies do not receive requisite approval for the
proposed Substitution from the MLLIC Retirement Power, MLLIC Retirement
Optimizer, MLNY Retirement Power, and MLNY Retirement Optimizer classes of
Variable Contracts, each voting as a separate group, the Companies will not
effect the proposed Substitution for ANY class of Variable Contracts. The
Companies will not effect the proposed Substitution for any class of Variable
Contracts that has not approved the proposed Substitution.
To the knowledge of the Companies, none of the directors or officers of
either Company, individually or as a group, beneficially owned, directly or
indirectly, over 1% of the outstanding units in a Subaccount as of the Record
Date. Any beneficial financial interest that the Companies may have in the
Subaccounts is immaterial in relation to the interests of Owners, and the
Companies will not cast any votes. No individual that has been a director or
executive officer of either Company at any time since January 2002, or any
associate of such individual, has any substantial interest, direct or indirect,
by security holdings or otherwise, in the proposed Substitution.
You may cast your vote by: (1) filling out the enclosed Voting Form and
returning it to Management Information Services at 60 Research Road, Hingham,
Massachusetts 02043; (2) using a toll-free telephone voting facility
(1-800-690-6903); or (3) visiting an internet website
(https://www.proxyweb.com). If you properly execute and return the enclosed
Voting Form (or cast your vote by telephone or internet) by Friday, November 7,
2003, at 4:00 p.m. Eastern Standard Time (the "Voting Deadline"), the Companies
will count your vote when calculating the results of the solicitation. The
Companies will disregard any voting instructions received after the Voting
Deadline. Votes attributable to Voting Forms that are properly executed and
returned, but are not marked to "Approve" or "Disapprove" the Substitution, will
be counted as "Approve." A vote to "Abstain" will have the effect of a vote to
"Disapprove" the Substitution.
Any Owner who has submitted voting instructions has the right to change his
or her vote at any time prior to the Voting Deadline by: (1) submitting a letter
requesting the change or a later-dated Voting Form to Management Information
Services at the above listed address; or (2) casting another vote at the above
listed telephone number or internet website. Any change must be received on or
before the Voting Deadline. If the Companies do not receive sufficient votes to
approve the proposal, they may extend the Voting Deadline and conduct a further
solicitation of votes. The Companies will solicit votes primarily by mail. The
Companies may supplement this effort by telephone calls, telegrams, e-mails,
personal interviews, and other communications by officers, employees, and agents
of the Companies or their affiliates, but no additional compensation will be
paid by the Companies to such individuals for such solicitation. Georgeson
Shareholder Communications Inc. ("Georgeson") will be retained by the Companies
to assist in the solicitation process, and will be paid by the Companies for
their services. Based on current estimates, the Companies anticipate that they
will pay Georgeson between $30,779 and $36,013 for these services. The actual
amount of these expenses will vary depending on a number of factors, such as the
number of Owners contacted by Georgeson. The Companies will bear these costs and
all other costs of soliciting votes.
2
THE PROPOSED SUBSTITUTION
I. THE TRANSACTION
On July 18, 2003, the Companies and the Separate Accounts submitted an
application to the Commission seeking approval to engage in the Substitution. If
completed, the Substitution will result in the Companies' redemption, in cash or
"in kind" (i.e., for portfolio securities), of Initial Class shares of the MFS
Investors Trust Series. The proceeds of such redemptions (either cash or
portfolio securities) will then be used to purchase shares of the Roszel/PIMCO
CCM Capital Appreciation Portfolio.
If approved, the Substitution will take place at relative net asset value
with no change in the amount of any Owner's contract value or death benefit or
in the dollar value of his or her investments in the Subaccounts. Owners will
not incur any additional fees or charges as a result of the Substitution, nor
will their rights or the Companies' obligations under the Variable Contracts be
altered in any way. All applicable expenses incurred in connection with the
Substitution will be paid by the Companies. In addition, the Substitution will
not subject Owners to any federal income tax liability.
The Substitution will not cause the Variable Contract fees and charges
currently paid by existing Owners to be greater after the Substitution than
before the Substitution. To the extent that the total operating expenses of the
Roszel/PIMCO CCM Capital Appreciation Portfolio (taking into account any expense
waiver or reimbursement), for each fiscal quarter during the twenty-four months
following the Substitution, exceed on an annualized basis the net expense level
of the MFS Investors Trust Series for the fiscal year ended December 31, 2002,
the Companies will, for each Variable Contract outstanding on the date of the
Substitution, make a corresponding reduction in Separate Account expenses on the
last day of such fiscal quarter, such that the amount of the Roszel/PIMCO CCM
Capital Appreciation Portfolio's net expenses, together with those of the
corresponding Separate Account will, on an annualized basis, be no greater than
the sum of the net expenses of the MFS Investors Trust Series and the expenses
of the Separate Account for the 2002 fiscal year (the "Expense Limitation"). In
addition, for twenty-four months following the Substitution, the Companies will
not increase asset-based fees or charges for Variable Contracts outstanding on
the day of the Substitution. Thereafter, expenses of the Replacement Portfolio
will vary from year to year and may exceed those of the Substituted Portfolio.
Owners are entitled to approve or disapprove the Substitution. The
Substitution will not take place without the approval of each class of Variable
Contracts representing the lesser of: (1) a majority of the outstanding units
for the Subaccount as of the Record Date, or (2) 67% of such outstanding units
voted, if votes received represent a majority of such units as of the Record
Date. If the Companies do not receive requisite approval for the proposed
Substitution from the MLLIC Retirement Power, MLLIC Retirement Optimizer, MLNY
Retirement Power, and MLNY Retirement Optimizer classes of Variable Contracts,
each voting as a separate group, the Companies will not effect the proposed
Substitution for any class of Variable Contracts.
The Companies intend to effect the Substitution on November 21, 2003
(following close of business), following the issuance of an order of approval by
the Commission, the requisite approval of the Owners, and any approval required
by state insurance regulators.
II. REASONS FOR THE PROPOSED SUBSTITUTION
The proposed Substitution is part of an overall business plan involving the
management of the Companies to make their respective products, including the
Variable Contracts, more competitive (both in terms of new sales, as well as
with regard to the retention of existing blocks of business) and more efficient
to administer and oversee. Over the past several years, the Companies have
engaged in a thorough review of the efficiencies and structures of all of the
investment options offered under the Variable Contracts. Based on its continuing
evaluation of the available investment options, the Companies believe that more
concentrated and streamlined operations for investment options could result in
increased operational and administrative efficiencies and economies of scale for
the Companies. More specifically, the Companies feel that streamlining the
number of nonproprietary fund families available through the Variable Contracts
and altering the available portfolios will
3
simplify the administration of the Variable Contracts, particularly with regard
to communications with the fund families and the preparation of various reports
and disclosure documents. This streamlining will allow the Companies to enhance
their communication efforts to Owners and sales representatives regarding the
available portfolios, and may provide for more enhanced and timely reporting to
the Companies from fund families and therefore from the Companies to Owners.
Furthermore, reducing the number of nonproprietary fund families also will
provide the Companies with more control over fund changes that affect their
Variable Contracts, allowing for appropriate long-term strategic planning.
During this continuing evaluation of the available investment options, the
Companies also have engaged in a thorough review of the quality of all of the
investment options offered under the Variable Contracts. This due diligence
review involved an evaluation of the investment performance, the investment
process, and the investment teams responsible for the management of the
portfolios. Ultimately, the Companies concluded that certain portfolios offered
under the Variable Contracts warrant replacement and that it would be preferable
to make alternative investment options available to both current and future
Owners.
Though not a principal reason for the Substitution, the Substitution would
have the effect of transferring Variable Contract values to investment
portfolios managed by an affiliated person of the Companies, Roszel Advisors,
LLC ("Roszel Advisors") (the investment manager to the Replacement Portfolio and
the other portfolios of the MLIG Trust), thereby increasing the management fees
received by Roszel Advisors.
For the reasons discussed below, the Companies believe that replacing the
MFS Investors Trust Series with the Roszel/PIMCO CCM Capital Appreciation
Portfolio is appropriate and in the best interests of Owners.
III. THE COMPANIES
MLLIC is a stock life insurance company that is domiciled in Arkansas. Its
operations include both life insurance and annuity products. MLLIC was
incorporated under the laws of the State of Washington on January 27, 1986 and
redomesticated to the State of Arkansas on August 31, 1991. As of December 31,
2002, MLLIC had assets of approximately $13.1 billion. MLLIC is authorized to
operate as a life insurance company in forty-nine states, the District of
Columbia, the U.S. Virgin Islands, Guam, and Puerto Rico. Its principal offices
are located at 1300 Merrill Lynch Drive, 2(nd) Floor, Pennington, New Jersey
08534.
MLNY is a stock life insurance company that is organized under the laws of
the State of New York on November 28, 1973. MLNY had approximately $1.1 billion
of assets under management as of December 31, 2002. MLNY is authorized to sell
life insurance and annuities in nine states. Its principal offices are located
at 2 World Financial Center, South Tower, 5(th) Floor, New York, New York 10281.
The Companies are wholly owned subsidiaries of Merrill Lynch Insurance
Group, Inc. ("MLIG"). The Companies are indirect wholly owned subsidiaries of
Merrill Lynch & Co., Inc., a publicly held company whose shares are traded on
the New York Stock Exchange.
IV. THE SEPARATE ACCOUNTS AND VARIABLE CONTRACTS
A. MLLIC RETIREMENT POWER AND RETIREMENT OPTIMIZER
Merrill Lynch Life Variable Annuity Separate Account A is a separate
investment account of MLLIC established under Arkansas law on August 6, 1991. It
currently has 42 subaccounts. Each subaccount invests in a corresponding
portfolio of an open-end management investment company. Retirement Power and
Retirement Optimizer Variable Contracts, which invest in the Substituted
Portfolio, have been issued by MLLIC through Merrill Lynch Life Variable Annuity
Separate Account A, and interests in the Separate Account offered through such
Variable Contracts have been registered under the Securities Act of 1933, as
amended (the "1933 Act"). The Separate Account is registered with the Commission
under the Investment Company Act of 1940, as amended (the "1940 Act") as a unit
investment trust.
4
MLLIC is the legal owner of the assets in the Merrill Lynch Life Variable
Annuity Separate Account A. Assets of the Separate Account equal to its reserves
and other liabilities under the outstanding Variable Contracts may not be
charged with liabilities arising from any other MLLIC business. Any income,
gain, or loss (whether or not realized) from the assets of the Separate Account
are credited to or charged against the Separate Account without regard to
MLLIC's other income, gain, or loss.
B. MLLIC LEGACY POWER
Merrill Lynch Variable Life Separate Account is a separate investment
account of MLLIC established under Arkansas law on November 19, 1990. It
currently has 37 subaccounts. Each subaccount invests in a corresponding
portfolio of an open-end management investment company. Legacy Power Variable
Contracts, which invest in the Substituted Portfolio, have been issued by MLLIC
through Merrill Lynch Variable Life Separate Account, and interests in the
Separate Account offered through such Variable Contracts have been registered
under the 1933 Act. The Separate Account is registered with the Commission under
the 1940 Act as a unit investment trust.
MLLIC is the legal owner of the assets in the Merrill Lynch Variable Life
Separate Account. Assets of the Separate Account equal to its reserves and other
liabilities under the outstanding Variable Contracts may not be charged with
liabilities arising from any other MLLIC business. Any income, gain, or loss
(whether or not realized) from the assets of the Separate Account are credited
to or charged against the Separate Account without regard to MLLIC's other
income, gain, or loss.
C. MLNY RETIREMENT POWER AND RETIREMENT OPTIMIZER
ML of New York Variable Annuity Separate Account A is a separate investment
account of MLNY established under New York law on August 14, 1991. It currently
has 42 subaccounts. Each subaccount invests in a corresponding portfolio of an
open-end management investment company. Retirement Power and Retirement
Optimizer Variable Contracts, which invest in the Substituted Portfolio, have
been issued by MLNY through ML of New York Variable Annuity Separate Account A,
and interests in the Separate Account offered through such Variable Contracts
have been registered under the 1933 Act. The Separate Account is registered with
the Commission under the 1940 Act as a unit investment trust.
MLNY is the legal owner of the assets in the ML of New York Variable
Annuity Separate Account A. Assets of the Separate Account equal to its reserves
and other liabilities under the outstanding Variable Contracts may not be
charged with liabilities arising from any other MLNY business. Any income, gain,
or loss (whether or not realized) from the assets of the Separate Account are
credited to or charged against the Separate Account without regard to MLNY's
other income, gain, or loss.
V. THE PORTFOLIOS
A. MFS(R) VARIABLE INSURANCE TRUST(SM)
The MFS Trust is registered as an open-end management investment company
under the 1940 Act and currently offers 15 separate investment portfolios,
including the MFS Investors Trust Series. The MFS Trust issues a separate series
of shares of common stock in connection with each portfolio, and has registered
such shares under the 1933 Act.
B. MLIG VARIABLE INSURANCE TRUST
The MLIG Trust is registered as an open-end management investment company
under the 1940 Act and currently offers 24 separate investment portfolios,
including the Roszel/PIMCO CCM Capital Appreciation Portfolio. The MLIG Trust
issues a separate series of shares of common stock in connection with each
portfolio, and has registered such shares under the 1933 Act.
5
VI. MANAGEMENT OF THE PORTFOLIOS
A. MFS INVESTORS TRUST SERIES
Massachusetts Financial Services Company ("MFS"), a Delaware corporation,
serves as the investment adviser to the MFS Investors Trust Series (and the
other portfolios of the MFS Trust). MFS is a subsidiary of Sun Life of Canada
(U.S.) Financial Services Holdings, Inc., which, in turn, is a indirect wholly
owned subsidiary of Sun Life Assurance Company of Canada. MFS' principal
business address is 500 Boylston Street, Boston, MA 02116.
For its services, MFS receives an investment advisory fee based on the
average daily net assets of the MFS Investors Trust Series.
B. ROSZEL/PIMCO CCM CAPITAL APPRECIATION PORTFOLIO
Roszel Advisors serves as the investment manager of the Roszel/PIMCO CCM
Capital Appreciation Portfolio (and the other portfolios of the MLIG Trust).
Roszel Advisors is a wholly owned subsidiary of MLIG, and its principal place of
business is 1300 Merrill Lynch Drive, Pennington, NJ 08534.
The MLIG Trust and Roszel Advisors obtained an order from the Commission
(the "Manager of Managers Order") that permits the MLIG Trust and Roszel
Advisors to enter into and materially amend investment subadvisory agreements
without obtaining shareholder approval. The relief granted in the Manager of
Managers Order extends to the Roszel/PIMCO CCM Capital Appreciation Portfolio.
Accordingly, as the investment manager, Roszel Advisors is responsible (subject
to oversight by the board of directors of the MLIG Trust) for overall management
of the MLIG Trust and for retaining additional subadvisers to manage the assets
of each portfolio. Roszel Advisors selects subadvisers based on a continuing
quantitative and qualitative evaluation of their skills and proven abilities in
managing assets pursuant to a particular investment style. IF YOU APPROVE THE
PROPOSED SUBSTITUTION, THAT MEANS YOU APPROVE THE REPLACEMENT PORTFOLIO'S
RELIANCE ON THIS MANAGER OF MANAGERS ORDER.
PIMCO Advisors Retail Holdings LLC and Cadence Capital Management LLC
("PIMCO" and "Cadence," respectively) are the subadvisers to the Roszel/PIMCO
CCM Capital Appreciation Portfolio. PIMCO's principal business address is 1345
Avenue of the Americas, 50(th) Floor, New York, NY 10105-4800. Cadence's
principal business address is 265 Franklin Street, 11(th) Floor, Boston, MA
02110.
For its services, Roszel Advisors is paid an advisory fee based on the
average daily net assets of the Roszel/PIMCO CCM Capital Appreciation Portfolio,
and Roszel Advisors pays PIMCO and Cadence for subadvisory services rendered to
the portfolios.
VII. COMPARISON OF THE PORTFOLIOS
The following discussion is primarily a summary of certain parts of the
current prospectuses and/or recent annual and semi-annual shareholder reports
for the Roszel/PIMCO CCM Capital Appreciation Portfolio and the MFS Investors
Trust Series. This Voting Information Statement is accompanied by current
prospectuses for the Roszel/PIMCO CCM Capital Appreciation Portfolio and the MFS
Investors Trust Series, or Owners will have previously received such
prospectuses. The most recent annual shareholder report and semi-annual
shareholder report for the Roszel/PIMCO CCM Capital Appreciation Portfolio are
available without charge upon request. As an Owner invested in the MFS Investors
Trust Series, you should have received the most recent annual shareholder report
and semi-annual shareholder report for the MFS Investors Trust Series.
Information contained in this Voting Information Statement is qualified by the
more complete information set forth in such prospectuses and reports which are
incorporated by reference herein.
As set forth below, the investment objectives and principal investment
strategies of the Substituted Portfolio and Replacement Portfolio are
substantially the same, and the types of investment advisory and administrative
services provided to the Replacement Portfolio are comparable to the types of
investment advisory and administrative services provided to the Substituted
Portfolio.
6
A. COMPARISON OF INVESTMENT OBJECTIVES AND PRINCIPAL INVESTMENT POLICIES
<Table>
<Caption>
ROSZEL/PIMCO CCM CAPITAL APPRECIATION
MFS INVESTORS TRUST SERIES OF THE MFS TRUST PORTFOLIO OF THE MLIG TRUST
- --------------------------------------------- ---------------------------------------------
INVESTMENT OBJECTIVE INVESTMENT OBJECTIVE
To provide long-term growth of capital, with To seek long-term capital appreciation.
reasonable current income as a secondary
objective
INVESTMENT POLICIES INVESTMENT POLICIES
Normally, the Series invests at least 65% of The portfolio invests at least 65% of total
net assets in common stocks and related assets in large cap stocks of companies
securities (preferred stocks, convertible believed to potential for high earnings
securities and depositary receipts for those growth. These companies are generally
securities). The portfolio's investment well-established issuers with strong business
adviser generally focuses on companies with franchises and favorable long-term growth
larger market caps (although it may invest in prospects. The portfolio's investment adviser
companies of any size) believed to have seeks to achieve a consistent, favorable
sustainable growth prospects and attractive balance of growth and value with stocks of
valuations based on current and expected companies in the Russell 1000 and the S&P 500
earnings or cash flow. The portfolio's Indexes. In choosing companies to invest in,
investment adviser will attempt to generate the portfolio's investment adviser first
gross current income equal to about 90% of looks at dividend growth, earnings growth,
the dividend yield on the Standard & Poor's relative growth of earnings over time, the
500 Composite Stock Index. The portfolio's company's history of meeting earnings
investment adviser selects securities by targets, and price-to-earnings ratios and
analyzing earnings, cash flows, competitive other ratios that reveal value. The most
position and management's abilities. The promising companies are then evaluated on the
Series may invest in foreign equity basis of management strength, competitiveness
securities in their industries, business prospects, and
profitability. The portfolio sells stocks
when their price declines relative to other
stocks invested in by the portfolio or to
other companies in the same business industry
or when the issuer's earnings decline. The
portfolio may invest up to 10% of total
assets in foreign securities. The portfolio
uses the S&P 500 Index as a benchmark index.
</Table>
The Roszel/PIMCO CCM Capital Appreciation Portfolio and the MFS Investors
Trust Series share similar investment objectives in that each seeks either
long-term growth of capital or capital appreciation. Moreover, the MFS Investors
Trust Series seeks reasonable current income, while the Roszel/PIMCO CCM Capital
Appreciation Portfolio, although not explicitly stated as part of its investment
objective, similarly treats current income as incidental to its investment
objective. In addition to similar investment objectives, the Roszel/PIMCO CCM
Capital Appreciation Portfolio and the MFS Investors Trust Series also share
similar investment policies. Both portfolios concentrate their investments in
the equity securities of companies with strong prospects for long-term growth,
and also may invest in foreign securities. Moreover, the Roszel/ PIMCO CCM
Capital Appreciation Portfolio, like the MFS Investors Trust Series, generally
concentrates on large cap companies.
B. COMPARISON OF ADVISORY FEES AND OTHER EXPENSES
The following charts compare the total operating expenses (before and after
any waivers and reimbursements) for the year ended December 31, 2002, expressed
as an annual percentage of average daily net assets, of the Substituted
Portfolio and the Replacement Portfolio. For two years following the
Substitution, MLLIC and MLNY will limit certain expenses for Variable Contracts
outstanding on the day of the Substitution pursuant to the Expense Limitation
described above. Thereafter, expenses of the Replacement Portfolio will vary
from year to year and may exceed those of the Substituted Portfolio.
7
<Table>
<Caption>
MFS INVESTORS TRUST ROSZEL/PIMCO
SERIES CCM CAPITAL
(INITIAL CLASS) APPRECIATION PORTFOLIO(1)
------------------- -------------------------
Management Fees................................. 0.75% 0.80%
12b-1 Fees...................................... N/A N/A
Other Expenses.................................. 0.13% 0.97%
---- -----
Total Operating Expenses........................ 0.88% 1.77%
Less Expense Waivers and Reimbursements......... N/A (0.67%)
---- -----
Net Operating Expenses.......................... 0.88% 1.10%
==== =====
</Table>
C. COMPARISON OF ADVISORY AND SUBADVISORY SERVICES
The following chart compares the fees paid for advisory and subadvisory
services for the fiscal year ending December 31, 2002, expressed as an annual
percentage of average daily net assets, by the Substituted Portfolio and the
Replacement Portfolio.
<Table>
<Caption>
ROSZEL/PIMCO CCM CAPITAL
MFS INVESTORS TRUST SERIES APPRECIATION PORTFOLIO
- ------------------------------------------------ ------------------------------------------------
ANNUAL SUBADVISORY FEES ANNUAL SUBADVISORY FEES
ANNUAL ADVISORY FEES (PAID BY THE ADVISER) ANNUAL ADVISORY FEES (PAID BY THE ADVISER)
- ----------------------- ----------------------- ----------------------- -----------------------
0.75% N/A 0.80% 0.35% on the first $200
million, 0.27% on the
second $200 million,
and 0.25% on assets in
excess of $400 million
</Table>
D. COMPARISON OF ASSET LEVELS AND PERFORMANCE
Because the Roszel/PIMCO CCM Capital Appreciation Portfolio only began
operations on May 1, 2003, it does not yet have any assets or performance to
compare to the Substituted Portfolio.
E. COMPARISON OF INVESTMENT RISKS
Because the Roszel/PIMCO CCM Capital Appreciation Portfolio and the MFS
Investors Trust Series share similar investment objectives and investment
policies, they generally invest in the same types of securities (e.g., equity
securities), and thus are subject to substantially the same types of risks. As
with any mutual fund that invests in equity securities, both of these portfolios
are subject to market risk. Loss of money is a significant risk of investing in
either of these portfolios. To the extent the Roszel/PIMCO CCM Capital
Appreciation Portfolio places more of a focus on equity securities that may
appreciate in value and less of an emphasis on those that provide income, it may
experience greater volatility over time than MFS Investors Trust Series,which
may invest more in income-bearing securities.
Both portfolios invest in large cap companies, which tend to go in and out
of favor based on market and economic conditions; large cap companies tend to be
less volatile than companies with smaller market caps. In exchange for this
potentially lower risk, the value of the MFS Investors Trust Series and the
Roszel/PIMCO CCM Capital Appreciation Portfolio may not rise as much as the
value of portfolios that emphasize smaller market cap companies.
- ---------------
(1) "Other Expenses" for the Roszel/PIMCO CCM Capital Appreciation Portfolio are
based on estimates for the fiscal year ended December 31, 2003. In addition,
MLIG Trust has entered into an expense limitation arrangement with Roszel
Advisors whereby Roszel Advisors will reimburse the Roszel/PIMCO CCM Capital
Appreciation Portfolio to the extent total operating expenses (excluding
interest, taxes, brokerage commissions, expenses in the form of fees paid to
the Trust service providers by brokers in connection with directed brokerage
arrangements, other expenditures that are capitalized in accordance with
generally accepted accounting principles, and other extraordinary expenses
not incurred in the ordinary course of the Portfolio's business) exceed
certain limits. The expense limitation agreement is effective through April
30, 2004, and is expected to continue from year to year, conditioned upon
approval for continuance by the board of trustees of the MLIG Trust.
8
To the extent that the portfolios invest in higher-risk securities, they
take on additional risks that could adversely affect their performance. For
example, to the extent that the portfolios invest in securities of foreign
issuers, they are subject to the risks related to such securities (such as the
risk of political instability, changes in currency exchange rates, foreign
economic conditions, or lax regulatory and accounting standards).
VIII. EFFECTS ON OWNERS
Additional facts concerning Owners' rights in connection with the
Substitution are as follows:
A. OWNERS WILL NOT:
- experience any change in the amount of contract value, death benefit, or
dollar value of their investments in any of the subaccounts of the
Separate Accounts as a result of the Substitution;
- incur any fees or charges as a result of the Substitution, including
charges that would otherwise be applied to transfers;
- experience an increase in the Variable Contract fees and charges as a
result of the Substitution;
- experience, with regard to Variable Contracts outstanding on the day of
the Substitution, an increase in the total operating expenses of the
Replacement Portfolio above those of the Substituted Portfolio as of
December 31, 2002 for twenty-four months following the Substitution,
pursuant to the Expense Limitation described above (thereafter, expenses
of the Replacement Portfolio will vary from year to year and may exceed
those of the Substituted Portfolio);
- experience, with regard to Variable Contracts outstanding on the day of
the Substitution, an increase in asset-based fees or charges for
twenty-four months following the Substitution;
- have their rights, or the Companies' obligations, under the Variable
Contracts altered in any way as a result of the Substitution (although
Owners will lose their right to vote on whether the MLIG Trust and Roszel
Advisors may enter into and materially amend investment subadvisory
agreements relating to the Replacement Portfolio, pursuant to the Manager
of Managers Order described above);
- incur any expenses as a result of the Substitution; or
- incur any federal income tax liability as a result of the Substitution.
B. OWNERS WILL:
- from July 18, 2003 through 30 days following the date of the
Substitution, be permitted to make one transfer of contract value from a
Subaccount to any other available subaccount(s) without that transfer
counting towards the number of transfers permitted should the Companies
begin charging for or otherwise limiting transfers in the future (the
Companies do not currently impose a charge for transfers or limit the
number of transfers permitted each year); and
- before the Substitution occurs, receive a copy of the most recent
prospectus for the Replacement Portfolio.
C. THE COMPANIES WILL:
- pay all expenses incurred in connection with the Substitution, including
legal, accounting, transactional, proxy, brokerage commissions, and other
fees and expenses.
D. THE COMPANIES WILL NOT:
- exercise any right they may have under the Variable Contracts to impose
restrictions or charges on transfers until at least 30 days after the
Substitution occurs.
9
THE COMPANIES RECOMMEND THAT YOU VOTE TO "APPROVE" THE PROPOSED SUBSTITUTION
(WHICH ALSO MEANS APPROVAL OF THE REPLACEMENT PORTFOLIO'S RELIANCE ON THE
MANAGER OF MANAGERS ORDER DESCRIBED ABOVE).
GENERAL INFORMATION
I. COST OF SOLICITATION
The Companies will pay the cost of the solicitation, including the
preparation and mailing of the Voting Information Statement and Voting Form, the
solicitation of votes, and legal and other expenses.
II. SERVICE PROVIDERS
Merrill Lynch, Pierce, Fenner & Smith Incorporated, an indirect wholly
owned subsidiary of Merrill Lynch & Co., Inc., serves as principal underwriter
and distributor for the Separate Accounts and the Variable Contracts. Its
principal business address is 4 World Financial Center New York, NY 10080. The
Separate Account has no administrator.
III. OWNER PROPOSALS
Owners have no rights under the Variable Contracts to put voting proposals
before the Owners.
IV. PROSPECTUSES AND ANNUAL AND SEMI-ANNUAL REPORTS
Upon request, the Companies will furnish, without charge, a copy of the
most recent annual shareholder reports and semi-annual shareholder reports for
the Roszel/PIMCO CCM Capital Appreciation Portfolio and additional copies of the
current prospectuses for the Roszel/PIMCO CCM Capital Appreciation Portfolio and
MFS Investors Trust Series and the most recent annual shareholder reports and
semi-annual shareholder reports for the MFS Investors Trust Series. To request
any of these, please call or write the Service Center applicable to your class
of Variable Contracts as noted below under "Inquiries."
V. DISSENTER'S RIGHTS OF APPRAISAL
Taken together, Arkansas Insurance law (in the case of MLLIC) or New York
Insurance law (in the case of MLNY) and the terms of the Variable Contracts do
not appear to provide appraisal rights to investors, such as the Owners, beyond
their right to receipt of the cash surrender value of their Variable Contracts.
The Companies believe that, for transactions such as the Substitution, this
requires, in effect, that values be determined as of 4:00 p.m. on the date of
the Substitution.
Interpretations of the 1940 Act by the Commission staff limit appraisal
rights of investors in a registered unit investment trust, such as Owners, to
those provided by Rule 22c-1 under the 1940 Act. Rule 22c-1, in effect, requires
for transactions such as the Substitution that values be determined as of 4:00
p.m. on the date of the Substitution.
10
VI. INQUIRIES
Owners may make inquiries by contacting their Financial Advisor or calling
or writing the Service Center applicable to their class of Variable Contracts as
follows:
<Table>
<Caption>
CLASS OF VARIABLE CONTRACT SERVICE CENTER
- ----------------------------------------------------- ------------------------------------------------
MLLIC Retirement Power and Retirement Optimizer ADDRESS: P.O. Box 44222
Jacksonville, Florida 32231-4222
PHONE: 1-800-535-5549
MLNY Retirement Power and Retirement Optimizer ADDRESS: P.O. Box 44222
Jacksonville, Florida 32231-4222
PHONE: 1-800-535-5549
MLLIC Legacy Power ADDRESS: P.O. Box 441395
Jacksonville, Florida 32231-4139
PHONE: 1-800-354-5333
</Table>
THE COMPANIES REQUEST THAT YOU PROMPTLY EXECUTE AND RETURN THE ENCLOSED VOTING
FORM. A PRE-ADDRESSED, POSTAGE-PAID ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE.
YOU ALSO MAY CAST YOUR VOTE BY CALLING 1-800-690-6903 OR ACCESSING
HTTPS://WWW.PROXYWEB.COM.
Current prospectuses and the most recent annual and semi-annual shareholder
reports for the Roszel/PIMCO CCM Capital Appreciation Portfolio and the MFS
Investors Trust Series are incorporated by reference into this Voting
Information Statement. The 1940 Act filing numbers and effective dates of each
of these documents are as follows:
- Prospectus dated May 1, 2003 for the Roszel/PIMCO CCM Capital
Appreciation Portfolio, 811-21038
- Semi-annual report dated June 30, 2003 for the Roszel/PIMCO CCM Capital
Appreciation Portfolio, 811-21038
- Prospectus dated May 1, 2003 for the MFS Investors Trust Series, 811-8326
- Annual report dated December 31, 2002 for the MFS Investors Trust Series,
811-8326
- Semi-annual report dated June 30, 2003 for the MFS Investors Trust
Series, 811-8326
11
VOTING FORM
Merrill Lynch Life Insurance Company
ML Life Insurance Company of New York
[Name of Contract Owner] Voting Authentication Number:
[Address]
[City, ST 00000]
Your variable life insurance contract or variable annuity contract issued by
Merrill Lynch Life Insurance Company or ML Life Insurance Company of New York
(collectively, the "Companies") through one of their separate accounts (the
"Separate Accounts") entitles you to vote as to each dollar of contract value
you held in the Subaccount of the applicable Separate Account investing in
Initial Class shares of the MFS Investors Trust Series, a series of the MFS(R)
Variable Insurance Trust(SM), as of September 12, 2003. To be counted, your
Voting Form must be received by the Companies no later than Friday, November 7,
2003, at 4:00 p.m. Eastern Standard Time.
THE COMPANIES RECOMMEND THAT YOU VOTE TO "APPROVE" THE PROPOSAL.
I hereby instruct Merrill Lynch Life Insurance Company or ML Life Insurance
Company of New York to count each dollar of contract value as to which I am
entitled to vote as follows:
Approve Disapprove Abstain
--------------- --------------- ---------------
for the following proposal:
Substitute shares of the Roszel/PIMCO CCM Capital Appreciation
Portfolio for Initial Class shares of the MFS Investors Trust
Series (which also means approval of the Roszel/ PIMCO CCM
Capital Appreciation Portfolio's reliance on the Manager of
Managers order described in the attached Voting Information
Statement)
I hereby revoke any and all votes with respect to the foregoing proposal
previously given by me. I acknowledge receipt of the Voting Information
Statement dated October 10, 2003, which describes the above proposal.
<Table>
- ------------------------------------------ ---------------------------
Authorized signature Date
- ------------------------------------------------------------------------
Variable Contract Owner Name
</Table>
PLEASE COMPLETE, SIGN, AND DATE THIS FORM AND RETURN PROMPTLY IN THE ENCLOSED
ENVELOPE. Please use blue or black ink or dark pencil. SIGNED VOTING FORMS THAT
DO NOT INDICATE A VOTE WILL BE TREATED AS A VOTE TO APPROVE THE PROPOSAL.