-----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, Olda+MWLlY6+9lWNUKdLcGtPHfiaizmxxMueaWkttb4JUnHxPtTM4wY9o+lyxkq8 95pIDaq7AuKXThMPq9vCzQ== 0000930413-04-005311.txt : 20041119 0000930413-04-005311.hdr.sgml : 20041119 20041119143729 ACCESSION NUMBER: 0000930413-04-005311 CONFORMED SUBMISSION TYPE: 485APOS PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 20041119 DATE AS OF CHANGE: 20041119 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TIC SEPARATE ACCOUNT ELEVEN FOR VARIABLE ANNUITIES CENTRAL INDEX KEY: 0001209404 IRS NUMBER: 000000000 FILING VALUES: FORM TYPE: 485APOS SEC ACT: 1933 Act SEC FILE NUMBER: 333-101778 FILM NUMBER: 041157518 MAIL ADDRESS: STREET 1: ONE TOWER SQUARE CITY: HARTFORD STATE: CT ZIP: 06183 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TIC SEPARATE ACCOUNT ELEVEN FOR VARIABLE ANNUITIES CENTRAL INDEX KEY: 0001209404 IRS NUMBER: 000000000 FILING VALUES: FORM TYPE: 485APOS SEC ACT: 1940 Act SEC FILE NUMBER: 811-21262 FILM NUMBER: 041157519 MAIL ADDRESS: STREET 1: ONE TOWER SQUARE CITY: HARTFORD STATE: CT ZIP: 06183 485APOS 1 c34474_485apos.txt REGISTRATION STATEMENT NO.333-101778 811-21262 ================================================================================ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 -------------- FORM N-4 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 POST-EFFECTIVE AMENDMENT NO. 4 AND REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 AMENDMENT NO. 5 -------------- TIC SEPARATE ACCOUNT ELEVEN FOR VARIABLE ANNUITIES (Exact name of Registrant) THE TRAVELERS INSURANCE COMPANY (Name of Depositor) -------------- One Cityplace Hartford, Connecticut 06103-3415 (Address of Depositor's Principal Executive Offices) Depositor's Telephone Number, including area code: (860) 308-1000 ERNEST J. WRIGHT The Travelers Insurance Company One Cityplace Hartford, Connecticut 06103-3415 (Name and Address of Agent for Service) -------------- Approximate Date of Proposed Public Offering: It is proposed that this filing will become effective (check appropriate box): [ N/A ] immediately upon filing pursuant to paragraph (b) of Rule 485. [ N/A ] on ____________ pursuant to paragraph (b) of Rule 485. [ X ] 60 days after filing pursuant to paragraph (a)(1) of Rule 485. [ N/A ] on _____ pursuant to paragraph (a)(1) of Rule 485. If appropriate, check the following box: [ N/A ] this post-effective amendment designates a new effective date for a previously filed post-effective amendment. FILING NOTE This Post-Effective Amendment No. 4 incorporates herein by reference Part A - Prospectus Portfolio Architect Plus and Part B - Statement of Additional Information from Post-Effective Amendment No. 3 filed on April 23, 2004. A supplement to the prospectus is filed herein. This post-effective amendment does not supercede any previous post-effective amendments in connection with other prospectuses filed pursuant to this Registration Statement. SUPPLEMENT DATED JANUARY 15, 2005 TO THE PORTFOLIO ARCHITECT PLUS ANNUITY PROSPECTUS DATED MAY 3, 2004 The following information supplements, and to the extent inconsistent therewith, replaces the information in the prospectus. Please retain this supplement and keep it with the prospectus for future reference. IN THE "SUMMARY" SECTION, UNDER THE SUBSECTION "WHAT EXPENSES WILL BE ASSESSED UNDER THE CONTRACT?", THE FIFTH PARAGRAPH IS DELETED AND REPLACED WITH THE FOLLOWING: If you elect a Guaranteed Minimum Withdrawal Benefit ("GMWB") rider, a charge will be deducted annually from amounts in the Variable Funding Options. There are three GMWB rider options, and the current charge for each rider is as follows: GMWB I: 0.40%; GMWB II: 0.50%; and GMWB III: 0.25%. IN THE "SUMMARY" SECTION, UNDER THE SUBSECTION "ARE THERE ANY ADDITIONAL FEATURES?", THE EIGHTH PARAGRAPH IS DELETED AND REPLACED WITH THE FOLLOWING: GUARANTEED MINIMUM WITHDRAWAL BENEFIT ("GMWB" OR "PRINCIPAL GUARANTEE"). For an additional charge, we will guarantee the periodic return of your investment. Under this benefit, we will pay you a percentage of your investment every year until your investment has been returned in full, regardless of market performance. Depending on when you elect to begin receiving payments and which GMWB rider you select, the maximum amount of your investment that you receive each year is 5% or 10%. The guarantee is subject to restrictions on withdrawals and other restrictions. IN THE "FEE TABLE" SECTION, UNDER "ANNUAL SEPARATE ACCOUNT CHARGES", THE FOOTNOTE TO THE "MAXIMUM GMWB CHARGE" IS DELETED AND REPLACED WITH THE FOLLOWING: The current charge for GMWB I is 0.40%, for GMWB II it is 0.50%, and for GMWB III it is 0.25%. IN THE "EXAMPLES" SECTION, THE FOLLOWING EXAMPLE TABLES ARE ADDED: EXAMPLE 4 -- This example assumes that you have elected the most expensive death benefit option, the E.S.P. optional death benefit and the Guaranteed Minimum Withdrawal Benefit I ("GMWB I") (assuming the current 0.40% charge applies).
IF CONTRACT IS SURRENDERED IF CONTRACT IS NOT SURRENDERED OR AT THE END OF PERIOD SHOWN ANNUITIZED AT THE END OF PERIOD SHOWN ------------------------------------- -------------------------------------- 10 FUNDING OPTION 1 YEAR 3 YEARS 5 YEARS YEARS 1 YEAR 3 YEARS 5 YEARS 10 YEARS - --------------- -------- --------- --------- -------- -------- --------- --------- --------- Underlying Fund with Maximum Total Annual Operating Expenses........ Underlying Fund with Minimum Total Annual Operating Expenses........
EXAMPLE 5 -- This example assumes that you have elected the most expensive death benefit option, the E.S.P. optional death benefit and the Guaranteed Minimum Withdrawal Benefit II ("GMWB II") (assuming the current 0.50% charge applies).
IF CONTRACT IS SURRENDERED IF CONTRACT IS NOT SURRENDERED OR AT THE END OF PERIOD SHOWN ANNUITIZED AT THE END OF PERIOD SHOWN ------------------------------------- -------------------------------------- 10 FUNDING OPTION 1 YEAR 3 YEARS 5 YEARS YEARS 1 YEAR 3 YEARS 5 YEARS 10 YEARS - --------------- -------- --------- --------- -------- -------- --------- --------- --------- Underlying Fund with Maximum Total Annual Operating Expenses....... Underlying Fund with Minimum Total Annual Operating Expenses.......
1 EXAMPLE 6 -- This example assumes that you have elected the most expensive death benefit option, the E.S.P. optional death benefit and the Guaranteed Minimum Withdrawal Benefit III ("GMWB III") (assuming the current 0.25% charge applies).
IF CONTRACT IS SURRENDERED IF CONTRACT IS NOT SURRENDERED OR AT THE END OF PERIOD SHOWN ANNUITIZED AT THE END OF PERIOD SHOWN ------------------------------------- -------------------------------------- 10 FUNDING OPTION 1 YEAR 3 YEARS 5 YEARS YEARS 1 YEAR 3 YEARS 5 YEARS 10 YEARS - --------------- -------- --------- --------- -------- -------- --------- --------- --------- Underlying Fund with Maximum Total Annual Operating Expenses....... Underlying Fund with Minimum Total Annual Operating Expenses.......
IN THE "CHARGES AND DEDUCTIONS" SECTION, THE SUBSECTION "GUARANTEED MINIMUM WITHDRAWAL BENEFIT CHARGE" IS DELETED AND REPLACED WITH THE FOLLOWING: If you elect to add a GMWB rider to your contract, a charge is deducted each business day from amounts held in the Variable Funding Options. The charge depends on which GWMB rider you select. The current charge for each rider is as follows: GMWB I: 0.40%; GMWB II: 0.50%; and GMWB III: 0.25%. Your current charge will not change unless you are able to reset your benefits, at which time we may modify the charge, which will never exceed 1.00%. THE SECTION ENTITLED "GUARANTEED MINIMUM WITHDRAWAL BENEFIT ("GMWB" OR "PRINCIPAL GUARANTEE")" IS DELETED AND REPLACED WITH THE FOLLOWING: GUARANTEED MINIMUM WITHDRAWAL BENEFIT ("GMWB" OR "PRINCIPAL GUARANTEE") For an additional charge, you may elect an optional rider for your contract that provides a Guaranteed Minimum Withdrawal Benefit, or "GMWB". A GMWB rider is designed to protect your investment from poor market performance, as long as you do not withdraw more than a certain amount from your contract each year. AVAILABILITY AND ELIGIBILITY We offer different GMWB riders so that you can choose the level of benefits and costs that makes the most sense for you. This prospectus offers three different GMWB riders, and the availability of each depends on when you purchase your Contract and your state of residence. The three GMWB riders described in this prospectus are called "GMWB I", "GMWB II", and "GMWB III". GMWB II and GMWB III are available in most states on or after January 15, 2005. If GMWB II and GMWB III are not available in your state, or if you purchased your contract before January 15, 2005, then you may only elect GMWB I. You may elect a GMWB rider only at the time of your initial purchase of the Contract. You may not elect a GMWB rider if you have also elected the GMAB rider offered under this Contract. REMAINING BENEFIT BASE ("RBB") For all GMWB riders, the amount of your investment that is guaranteed is called the "remaining benefit base" or "RBB." Your initial RBB is equal to your initial Purchase Payment if you elect GMWB when you purchase your contract. Your initial RBB does not include Purchase Payment Credits. The RBB is not a lump sum guarantee, rather, it is the amount that we guarantee to return to you through a series of payments that annually do not exceed a percentage of your RBB. ANNUAL WITHDRAWAL BENEFIT ("AWB") The annual percentage of your RBB that is available for withdrawal is called the "annual withdrawal benefit" or "AWB". Each year you may take withdrawals that do not exceed your AWB until your RBB is depleted. Each year you may take your AWB monthly, annually, or on any payment schedule you request. You may take withdrawals in any dollar amount up to your AWB without affecting your guarantee. If you choose to receive only a part of, or none of, your AWB in any 2 given year, your AWB in any subsequent year will not be increased. In that case you are choosing to deplete your RBB over a longer period of time. The AWB is a percentage of your RBB and depends on which GMWB rider you select. Your initial AWB is calculated as a percentage of the RBB immediately before your first withdrawal:
- ----------------------------------------------------------------- ------------------ ---------------- ---------------- GMWB I GMWB II GMWB III - ----------------------------------------------------------------- ------------------ ---------------- ---------------- If you make your first withdrawal BEFORE the 3rd anniversary 5% of RBB 5% of RBB 5% of RBB after you purchase GMWB: - ----------------------------------------------------------------- ------------------ ---------------- ---------------- If you make your first withdrawal AFTER the 3rd anniversary 10% of RBB 10% of RBB 5% of RBB after you purchase GMWB: - ----------------------------------------------------------------- ------------------ ---------------- ----------------
ADDITIONAL PREMIUM Currently, additional Purchase Payments serve to increase your RBB and AWB. After each Purchase Payment your new RBB equals your RBB immediately prior to the Purchase Payment plus the dollar amount of the Purchase Payment, not including any Purchase Payment Credits. Your new AWB is equal to the AWB immediately prior to the Purchase Payment, plus a percentage of the Purchase Payment. We use the same percentage as that used to calculate your original AWB as shown above. We reserve the right not to include additional Purchase Payments into the calculation of the RBB or AWB. WITHDRAWALS When you make a withdrawal, your AWB remains the same as long as the sum of all of your withdrawals since the most recent anniversary of your purchase or reset of GMWB (or "GMWB Anniversary"), including the current withdrawal, does not exceed your AWB immediately prior to the current withdrawal. In such case your RBB is decreased to equal the RBB immediately prior to the withdrawal, less the dollar amount of the current withdrawal. However, if you make a withdrawal so that the total of all your withdrawals since your GMWB anniversary, including the current withdrawal, exceeds your AWB immediately prior to the current withdrawal, we will recalculate both your RBB and AWB. The recalculation depends on which GMWB rider you select: IF YOU SELECT GMWB II OR GMWB III: o To recalculate your RBB, we reduce your RBB by the greater of the dollar amount of your withdrawal, or a "partial withdrawal reduction". The partial withdrawal reduction is equal to 1) the RBB in effect immediately prior to the current withdrawal, multiplied by 2) the amount of the current withdrawal divided by 3) the Contract Value immediately prior to the current withdrawal, minus any Purchase Payment Credits applied within 12 months of the withdrawal. o To recalculate your AWB, we reduce your AWB by a partial withdrawal reduction, which is equal to 1) the AWB in effect immediately prior to the current withdrawal, multiplied by 2) the RBB immediately after the withdrawal divided by 3) the RBB immediately prior to the current withdrawal. IF YOU PURCHASED GMWB I: o To recalculate your RBB, we reduce your RBB by a "partial withdrawal reduction". The partial withdrawal reduction is equal to 1) the RBB in effect immediately prior to the current withdrawal, multiplied by 2) the amount of the current withdrawal divided by 3) the Contract Value immediately prior to the current withdrawal, minus any Purchase Payment Credits applied within 12 months of the withdrawal. o To recalculate your AWB, we reduce your AWB by a partial withdrawal reduction, which is equal to 1) the AWB in effect immediately prior to the current withdrawal, multiplied by 2) the 3 RBB immediately after the withdrawal divided by 3) the RBB immediately prior to the current withdrawal. We will waive any surrender charge on amounts that you withdraw up to your AWB, or on amounts up to the amount withdrawn under our Managed Distribution Program, even if such annual amount withdrawn is greater than your free withdrawal allowance. WITHDRAWAL EXAMPLES The following examples are intended to illustrate the effect of withdrawals on your RBB and AWB, depending on which GMWB rider you select. Assume your initial RBB is $100,000, your age is less than 70, and you take a withdrawal of $10,000 after your first GMWB Anniversary:
WITHDRAWAL EXAMPLE FOR GMWB II AND GMWB III - -------------------- ------------------------------------------------------- --------------------------------------------------- ASSUMES 15% GAIN ON INVESTMENT ASSUMES 15% LOSS ON INVESTMENT - -------------------- ------------ --------------------- -------------------- ----------- --------------------- ----------------- CONTRACT RBB AWB (5%) CONTRACT RBB AWB (5%) VALUE VALUE - -------------------- ------------ --------------------- -------------------- ----------- --------------------- ----------------- VALUES AS OF - -------------------- ------------ --------------------- -------------------- ----------- --------------------- ----------------- INITIAL GMWB $106,000 $100,000 $5,000 $106,000 $100,000 $5,000 PURCHASE - -------------------- ------------ --------------------- -------------------- ----------- --------------------- ----------------- IMMEDIATELY PRIOR $121,900 $100,000 $5,000 $90,100 $100,000 $5,000 TO WITHDRAWAL - -------------------- ------------ --------------------- -------------------- ----------- --------------------- ----------------- PARTIAL WITHDRAWAL N/A (100,000 (5,000 X (1- N/A (100,000 (5,000 REDUCTION X 10,000/121,900)= 90,000/100,000)= X 10,000/90,100)= X(1-88,901/100,000)= 8,203 500 $11,099 $555 - -------------------- ------------ --------------------- -------------------- ----------- --------------------- ----------------- GREATER OR PWR OR $10,000 $11,099 THE DOLLAR AMOUNT OF THE WITHDRAWAL (10,000>8,203) (11,099>10,000) - -------------------- ------------ --------------------- -------------------- ----------- --------------------- ----------------- CHANGE IN VALUE $10,000 $10,000 $500 $10,000 $11,099 $555 DUE TO WITHDRAWAL (PARTIAL SURRENDER REDUCTION) - -------------------- ------------ --------------------- -------------------- ----------- --------------------- ----------------- VALUE IMMEDIATELY $111,900 $90,000 $4,500 $80,100 $88,901 $4,445 AFTER WITHDRAWAL - -------------------- ------------ --------------------- -------------------- ----------- --------------------- -----------------
WITHDRAWAL EXAMPLE FOR GMWB I - -------------------- ------------------------------------------------------- --------------------------------------------------- ASSUMES 15% GAIN ON INVESTMENT ASSUMES 15% LOSS ON INVESTMENT - -------------------- ------------ --------------------- -------------------- ----------- --------------------- ----------------- CONTRACT RBB AWB (5%) CONTRACT RBB AWB (5%) VALUE VALUE - -------------------- ------------ --------------------- -------------------- ----------- --------------------- ----------------- VALUES AS OF - -------------------- ------------ --------------------- -------------------- ----------- --------------------- ----------------- INITIAL GMWB $106,000 $100,000 $5,000 $106,000 $100,000 $5,000 PURCHASE - -------------------- ------------ --------------------- -------------------- ----------- --------------------- ----------------- IMMEDIATELY PRIOR $121,900 $100,000 $5,000 $90,100 $100,000 $5,000 TO WITHDRAWAL - -------------------- ------------ --------------------- -------------------- ----------- --------------------- ----------------- IMMEDIATELY AFTER $111,900 91,797 $4,590 $80,100 $88,901 $4,445 WITHDRAWAL [100,000 - (100,000 [5,000 - (5,000 [100,000 - (100,000 [5,000 X x10,000/121,900)] x91,797/100,00)] x10,000/90,100)] (88,901/100,000)] - -------------------- ------------ --------------------- -------------------- ----------- --------------------- ----------------- CHANGE IN VALUE $10,000 $8,203 $410 $10,000 $11,099 $555 DUE TO WITHDRAWAL (PARTIAL SURRENDER REDUCTION) - -------------------- ------------ --------------------- -------------------- ----------- --------------------- -----------------
4 TAX-QUALIFIED DISTRIBUTION PROGRAMS (GMWB II AND GMWB III ONLY) If you select GMWB II or GMWB III, subject to certain limitations and restrictions, your AWB will not incur a recalculation as a result of distributions taken under certain eligible Tax-Qualified Distribution Programs. Instead, such distributions will reduce the RBB by the amount of the withdrawal, and will not affect the AWB. The following Tax-Qualified Distribution Programs are eligible: o Distributions intended to satisfy the required minimum distribution rules under Internal Revenue Code ("Code") Section 401(a)(9) and the Treasury Regulations promulgated thereunder, as applicable, to a qualified retirement plan (Code Section 401), a tax-sheltered annuity (Code Section 403(b)), an individual retirement account (Code Sections 408(a)), an individual retirement annuity (Code Section 408(b)), or a qualified deferred compensation plan (Code Section 457), which required minimum distribution is calculated using the Uniform Life Table (described in Treasury Regulation Section 1.401(a)(9)-9, Q&A-2) and/or the Joint and Last Survivor Table (described in Treasury Regulation Section 1.401(a)(9)-9, Q&A-3), and for distributions where the employee (owner) dies before entire interest is distributed as described in Code Section 401(a)(9)(B)(iii) calculated using the Single Life Table (described in Treasury Regulation Section 1.401(a)(9)-9, Q&A-1), as appropriate (each table as in effect as of January 1, 2004); o Distributions intended to satisfy the exception under Code Section 72(s)(2) to the required minimum distribution rules which apply after the death of the holder of a nonqualified annuity contract provided under Code Section 72(s)(1) for certain amounts payable over the life of a designated beneficiary; o Distributions intended to satisfy the exception under Code Section 72(t)(2)(A)(iv) from the 10% additional tax on early distributions from qualified retirement plans imposed by Code Section 72(t)(1) for certain amounts payable as part of a series of substantially equal periodic payments made for the life (or life expectancy) of the employee or the joint lives (or joint life expectancies) of such employee and his designated beneficiary, provided, however, the amount of the substantially equal periodic payments must be calculated under the required minimum distribution method set forth in the Internal Revenue Service Notice 89-25, 1989-1 C.B. 662 in Q&A-12 as amended by Revenue Ruling 2002-62, 2002-42 I.R.B. 710 (substantially equal periodic payments calculated under the fixed annuitization method or the fixed amortization method described in Q&A-12 of Notice 89-25 will not be considered a Tax-Qualified Distribution Program); or o Distributions intended to satisfy the exception under Code Section 72(q)(2)(D) from the 10% additional tax on early distributions from nonqualified annuity contracts imposed by Code Section 72(q)(1) for certain amounts payable as part of a series of substantially equal periodic payments made for the life (or life expectancy) of the Beneficiary or the joint lives (or joint life expectancies) of such Beneficiary and his designated beneficiary, provided, however, the amount of the substantially equal periodic payment must be calculated under the required minimum distribution method set forth in Internal Revenue Service Notice 89-25, 1989-1 C.B. 662 in Q&A-12 as amended by Internal Revenue Bulletin 2004 -9, Notice 2004-15, page 526. (substantially equal periodic payments calculated under the fixed annuitization method or the fixed amortization method described in Q&A-12 of Notice 89-25 will not be considered a Tax-Qualified Distribution Program). You are subject to the following limitations if you enroll in a Tax-Qualified Distribution Program: o YOU MUST ENROLL IN OUR MANAGED DISTRIBUTION PROGRAM. If you do not enroll or if you cancel your enrollment, you can continue to make withdrawals under your GMWB rider, however your RBB and AWB may be subject to a recalculation. Under our Managed Distribution Program, you select a frequency of payments. You may change the frequency of your payments only once 5 every two years after your GMWB Anniversary, and you may only make the change during the 30-day period after your GMWB Anniversary. At the time you purchase GMWB, your initial frequency of payment must be annual if you did not take distributions pursuant to your Tax-Qualified Distribution Program at your previous financial institution, unless you turn age 70 1/2 before the first GMWB anniversary. You are advised to take your required distributions prior to purchasing GMWB in order to have the choice of taking your distributions on a monthly, quarterly, semi-annual or annual basis. If you do not take your distribution before purchasing GMWB, you will be limited to taking annual distributions for the first two contract years after which time you can choose an alternate mode of distribution. o ANY WITHDRAWALS OUTSIDE OF THE PROGRAM MAY DECREASE YOUR BENEFIT. All withdrawals under your Contract must be made pursuant to the Tax-Qualified Distribution Program during any 12-month period after an anniversary of your purchase of GMWB (a "GMWB Year"). If during any GMWB Year you take any additional withdrawals that are not made pursuant to the Program, you can continue to make withdrawals under your GMWB rider, however for the remainder of the GMWB Year your RBB and AWB may be subject to a recalculation. RESET (GMWB I AND GMWB II ONLY) If you select GMWB I or GMWB II, you may choose to reset your RBB at any time on or after the 5th anniversary of your GMWB purchase. Your new RBB is reset to equal your current Contract Value, minus any Purchase Payment Credits received 12 months before the date you reset. You may reset your RBB again every 5 years after the most recent reset. Once you become eligible to reset your RBB, we reserve the right to allow resets only on the anniversary of your GMWB purchase. Each time you reset your RBB, your new AWB will equal a percentage of your new RBB. The percentage used is the same percentage used to calculate your AWB before the reset. If you are age 95 and are taking withdrawals under a Tax-Qualified Distribution Program, you may not reset if you purchased GMWB II or GMWB III. Depending on your Contract Value and the current fee for GMWB, it may not be beneficial to reset your RBB. Generally, it may be beneficial to reset your RBB if your Contract Value exceeds your RBB. However, the current charge in effect at the time of the reset will apply which may be higher than the current charge. Further, if you reset your RBB, your new AWB may be higher or lower than your current AWB. In addition, the length of time over which you can expect to receive your RBB will be reset. INVESTMENT RESTRICTIONS (GMWB II AND GMWB III ONLY) We reserve the right to restrict allocations to a Variable Funding Option or limit the percentage of Contract value that may be allocated to a Variable Funding Option at any time. We also reserve the right to require periodic rebalancing of Contract value allocated to Variable Funding Options according to specified percentages. We will provide no less than 30 days advanced written notice if we exercise our right to restrict or limit allocations to a Variable Funding Option and/or require periodic rebalancing between Variable Funding Options. Our ability to restrict allocations to a Variable Funding Option may be different depending on your state. If we restrict allocations to a Variable Funding Option, as of the effective date of the restriction, we will no longer allow additional Purchase Payments to be applied, or transfers of Contract value to be allocated into the restricted Variable Funding Option. Any Contract value previously allocated to a restricted Variable Funding Option will not be subject to the restriction. If we impose a limit on the percentage of Contract value allocated to a Variable Funding Option, as of the effective date of the restriction, we will impose the limit on all subsequent allocations. GMWB CHARGE The charge for your GMWB rider is different depending on which version of GMWB you choose. For all GMWB riders, the charge is deducted on an annual basis from amounts held in each 6 Variable Funding Option. The current charge for each rider is shown below. Your current charge will not change unless you reset your benefits, at which time we may modify the charge. In such case the charge will never exceed 1.00%.
------------------------ ----------------------------- ------------------------------ ----------------------------- GMWB I GMWB II GMWB III ------------------------ ----------------------------- ------------------------------ ----------------------------- Current Annual Charge 0.40% 0.50% 0.25% ------------------------ ----------------------------- ------------------------------ ----------------------------- Maximum Annual Charge 1.00% 1.00% N/A After a Reset ------------------------ ----------------------------- ------------------------------ -----------------------------
MAXIMUM RBB Although we have no current plans to do so, in the future we may impose a maximum RBB. If we do, we would stop including additional Purchase Payments into the calculation of your RBB. If we impose a maximum RBB for Purchase Payments or reset, the maximum RBB will never be less than the cumulative Purchase Payments to which we have previously consented. Currently you must obtain our consent to purchase any RBB over $1 million. Purchase Payments under $1 million are not subject to a maximum RBB. TERMINATION Once you purchase GMWB I, you cannot cancel it. If you select GMWB II or GMWB III, you may terminate your rider at any time after the 5th anniversary of your purchase of GMWB. Once you terminate a GMWB rider, you cannot re-elect it. You must request your termination in writing. All GMWB riders terminate automatically when you reach the maturity date of your Contract, if your Contract is assigned, or if the rider is exchanged for a similar rider offered by us. OTHER INFORMATION ABOUT GMWB If your Contract Value reaches zero, and you have purchased this benefit, the following will occur: o The AWB will continue to be paid to you until the RBB is depleted, not more frequently than monthly. Upon your death, your beneficiary will receive these payments. No other death benefit or optional benefit, if any, will be paid. o The total annual payment amount will equal the AWB and will never exceed your RBB, and o We will no longer accept subsequent Purchase Payments into the Contract. If a spouse or beneficiary continues this Contract upon your death, and you had elected GMWB, all terms and conditions of this benefit would apply to the new owner. Please refer to the Death Benefit section for information on how GMWB may impact your death benefit. COMPARISON OF IMPORTANT DIFFERENCES BETWEEN GMWB I, II, AND III The following chart may help you decide which version of GMWB is best for you.
------------------------ ----------------------------- ------------------------------ ----------------------------- GMWB I GMWB II GMWB III ------------------------ ----------------------------- ------------------------------ ----------------------------- AWB 5% of RBB if first 5% of RBB if first 5% of RBB withdrawal before 3rd withdrawal before 3rd anniversary anniversary 10% of RBB if first 10% of RBB if first withdrawal after 3rd withdrawal after 3rd anniversary anniversary ------------------------ ----------------------------- ------------------------------ ----------------------------- ANNUAL CHARGE 0.40% 0.50% 0.25% ------------------------ ----------------------------- ------------------------------ ----------------------------- RESET Yes Yes No ------------------------ ----------------------------- ------------------------------ ----------------------------- CAN I CANCEL MY GMWB? No Yes Yes ------------------------ ----------------------------- ------------------------------ ----------------------------- INVESTMENT RESTRICTIONS No Yes Yes ------------------------ ----------------------------- ------------------------------ ----------------------------- WAIVER OF No Yes Yes RECALCULATION OF AWB FOR DISTRIBUTIONS FROM TAX-QUALIFIED PLANS ------------------------ ----------------------------- ------------------------------ -----------------------------
7 PART C OTHER INFORMATION ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS (a) All financial statements will be filed by amendment. (b) EXHIBITS EXHIBIT NUMBER DESCRIPTION ------ ----------- 1. Resolution of The Travelers Insurance Company Board of Directors authorizing the establishment of the Registrant. (Incorporated herein by reference to Exhibit 1 to the Registration Statement on Form N-4, filed May 23, 1997.) 2. Not Applicable. 3(a). Distribution and Principal Underwriting Agreement among the Registrant, The Travelers Insurance Company and Travelers Distribution LLC. (Incorporated herein by reference to Exhibit 3(a) to Post Effective Amendment No. 4 to the Registration Statement on Form N-4, File No. 333-58783 filed February 26, 2001.) 3(b). Form of Selling Agreement. (Incorporated herein by reference to Exhibit 3(b) to Post-Effective Amendment No. 2 to the Registration Statement on Form N-4, File No. 333-65942 filed April 15, 2003.) 4. Form of Guaranteed Minimum Withdrawal Rider. 5. Form of Application. (Incorporated herein by reference to Exhibit 5 to Pre-Effective Amendment No. 1 to the Registration Statement on Form N-4, File No. 333-101778 filed April 17, 2003.) 6.(a) Charter of The Travelers Insurance Company, as amended on October 19, 1994. (Incorporated herein by reference to Exhibit 6(a) to the Registration Statement on Form N-4, File No. 333-40193, filed November 13, 1998.) 6.(b) By-Laws of The Travelers Insurance Company, as amended on October 20, 1994. (Incorporated herein by reference to Exhibit 3(a)(ii) to Registration Statement on Form S-2, File No. 33-58677, filed via EDGAR on April 18, 1995.) 7. Form of Reinsurance Contract. (Incorporated herein by reference to Exhibit 7 to Post-Effective Amendment No. 2 to the Registration Statement on Form N-4, File No. 333-65942 filed April 15, 2003.) 8. Form of Participation Agreement. (Incorporated herein by reference to Exhibit h to Post-Effective Amendment No. 3 to the Registration Statement on Form N-6, File No. 333-56952, filed February 7, 2003.) 9. Opinion of Counsel as to the legality of securities being registered. (Incorporated herein by reference to Exhibit 9 to the Registration Statement on Form N-4, filed December 11, 2002.) 10. Consent of Independent Auditors. To be filed by amendment. 11. Not Applicable. 12. Not Applicable. 15. Powers of Attorney authorizing Ernest J. Wright or Kathleen A. McGah as signatory for George C. Kokulis, Glenn D. Lammey, Marla Berman Lewitus and Kathleen L. Preston. (Incorporated herein by reference to Exhibit 15 to the Registration Statement on Form N-4, filed December 11, 2002.) ITEM 25. DIRECTORS AND OFFICERS OF THE DEPOSITOR
NAME AND PRINCIPAL POSITIONS AND OFFICES BUSINESS ADDRESS WITH INSURANCE COMPANY - ---------------- ---------------------- George C. Kokulis* Director, Chairman, President and Chief Executive Officer Glenn D. Lammey* Director, Senior Executive Vice President, Chief Financial Officer, Chief Accounting Officer Kathleen L. Preston* Director and Executive Vice President Edward W. Cassidy* Senior Vice President Winifred Grimaldi* Senior Vice President Marla Berman Lewitus* Director, Senior Vice President and General Counsel Brendan Lynch* Senior Vice President David A. Tyson* Senior Vice President David A. Golino* Vice President and Controller Donald R. Munson, Jr.* Vice President Mark Remington* Vice President Tim W. Still* Vice President Bennett Kleinberg* Vice President Dawn Fredette* Vice President George E. Eknaian* Vice President and Chief Actuary Linn K. Richardson* Second Vice President and Actuary Paul Weissman* Second Vice President and Actuary Ernest J.Wright* Vice President and Secretary Kathleen A. McGah* Assistant Secretary and Deputy General Counsel
Principal Business Address: * The Travelers Insurance Company One Cityplace Hartford, CT 06103-3415 ITEM 26. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE DEPOSITOR OR REGISTRANT Incorporated herein by reference to Exhibit 16 to Post-Effective Amendment No. 6 to the Registration Statement on Form N-4, File No. 333-82009, filed April 14, 2004. ITEM 27. NUMBER OF CONTRACT OWNERS To be filed by amendment. ITEM 28. INDEMNIFICATION Sections 33-770 to 33-778, inclusive of the Connecticut General Statutes ("C.G.S.") regarding indemnification of directors and officers of Connecticut corporations provides in general that Connecticut corporations shall indemnify their officers, directors and certain other defined individuals against judgments, fines, penalties, amounts paid in settlement and reasonable expenses actually incurred in connection with proceedings against the corporation. The corporation's obligation to provide such indemnification generally does not apply unless (1) the individual is wholly successful on the merits in the defense of any such proceeding; or (2) a determination is made (by persons specified in the statute) that the individual acted in good faith and in the best interests of the corporation and in all other cases, his conduct was at least not opposed to the best interests of the corporation, and in a criminal case he had no reasonable cause to believe his conduct was unlawful; or (3) the court, upon application by the individual, determines in view of all of the circumstances that such person is fairly and reasonably entitled to be indemnified, and then for such amount as the court shall determine. With respect to proceedings brought by or in the right of the corporation, the statute provides that the corporation shall indemnify its officers, directors and certain other defined individuals, against reasonable expenses actually incurred by them in connection with such proceedings, subject to certain limitations. C.G.S. Section 33-778 provides an exclusive remedy; a Connecticut corporation cannot indemnify a director or officer to an extent either greater or less than that authorized by the statute, e.g., pursuant to its certificate of incorporation, by-laws, or any separate contractual arrangement. However, the statute does specifically authorize a corporation to procure indemnification insurance to provide greater indemnification rights. The premiums for such insurance may be shared with the insured individuals on an agreed basis. Citigroup Inc. also provides liability insurance for its directors and officers and the directors and officers of its subsidiaries, including the Registrant. This insurance provides for coverage against loss from claims made against directors and officers in their capacity as such, including, subject to certain exceptions, liabilities under the federal securities laws. RULE 484 UNDERTAKING Insofar as indemnification for liability arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liability (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. ITEM 29. PRINCIPAL UNDERWRITER (a) Travelers Distribution LLC One Cityplace Hartford, CT 06103-3415 Travelers Distribution LLC also serves as principal underwriter and distributor for the following funds: The Travelers Fund U for Variable Annuities, The Travelers Fund VA for Variable Annuities, The Travelers Fund BD for Variable Annuities, The Travelers Fund BD II for Variable Annuities, The Travelers Fund BD III, The Travelers Fund BD IV for Variable Annuities, The Travelers Fund ABD II for Variable Annuities, The Travelers Separate Account PF for Variable Annuities, The Travelers Separate Account PF II for Variable Annuities, The Travelers Separate Account QP for Variable Annuities, The Travelers Separate Account TM for Variable Annuities, The Travelers Separate Account TM II for Variable Annuities, The Travelers Separate Account Five for Variable Annuities, The Travelers Separate Account Six for Variable Annuities, The Travelers Separate Account Seven for Variable Annuities, The Travelers Separate Account Eight for Variable Annuities, The Travelers Separate Account Nine for Variable Annuities, The Travelers Separate Account Ten for Variable Annuities, The Travelers Fund UL for Variable Life Insurance, The Travelers Fund UL II for Variable Life Insurance, The Travelers Fund UL III for Variable Life Insurance, The Travelers Variable Life Insurance Separate Account One, The Travelers Variable Life Insurance Separate Account Two, The Travelers Variable Life Insurance Separate Account Three, The Travelers Variable Life Insurance Separate Account Four, The Travelers Separate Account MGA, The Travelers Separate Account MGA II, The Travelers Growth and Income Stock Account for Variable Annuities, The Travelers Quality Bond Account for Variable Annuities, The Travelers Money Market Account for Variable Annuities, The Travelers Timed Growth and Income Stock Account for Variable Annuities, The Travelers Timed Short-Term Bond Account for Variable Annuities and The Travelers Timed Aggressive Stock Account for Variable Annuities, Citicorp Life Variable Annuity Separate Account and First Citicorp Life Variable Annuity Separate Account, TIC Separate Account Eleven for Variable Annuities, TLAC Separate Account Twelve for Variable Annuities, TIC Separate Account Thirteen for Variable Annuities, TLAC Separate Account Fourteen for Variable Annuities, TIC Variable Annuity Separate Account 2002, and TLAC Variable Annuity Separate Account 2002.
(b) NAME AND PRINCIPAL POSITIONS AND OFFICES BUSINESS ADDRESS WITH UNDERWRITER ---------------- ---------------- Kathleen L. Preston Board of Manager Glenn D. Lammey Board of Manager William F. Scully III Board of Manager Donald R. Munson, Jr. Board of Manager, President, Chief Executive Officer and Chief Operating Officer Tim W. Still Vice President Anthony Cocolla Vice President John M. Laverty Treasurer and Chief Financial Officer Stephen E. Abbey Chief Compliance Officer Alison K. George Director and Chief Advertising Compliance Officer Stephen T. Mullin Chief Compliance Officer Ernest J. Wright Secretary Kathleen A. McGah Assistant Secretary William D. Wilcox Assistant Secretary
* The business address for all the above is: One Cityplace, Hartford, CT 06103-3415 (c) Not Applicable ITEM 30. LOCATION OF ACCOUNTS AND RECORDS (1) The Travelers Insurance Company One Cityplace Hartford, Connecticut 06103-3415 ITEM 31. MANAGEMENT SERVICES Not Applicable. ITEM 32. UNDERTAKINGS The undersigned Registrant hereby undertakes: (a) To file a post-effective amendment to this registration statement as frequently as is necessary to ensure that the audited financial statements in the registration statement are never more than sixteen months old for so long as payments under the variable annuity contracts may be accepted; (b) To include either (1) as part of any application to purchase a contract offered by the prospectus, a space that an applicant can check to request a Statement of Additional Information, or (2) a post card or similar written communication affixed to or included in the prospectus that the applicant can remove to send for a Statement of Additional Information; and (c) To deliver any Statement of Additional Information and any financial statements required to be made available under this Form N-4 promptly upon written or oral request. The Company hereby represents: (a) That the aggregate charges under the Contracts of the Registrant described herein are reasonable in relation to the services rendered, the expenses expected to be incurred, and the risks assumed by the Company. SIGNATURES As required by the Securities Act of 1933 and the Investment Company Act of 1940, the Registrant has caused this amendment to this registration statement to be signed on its behalf, in the City of Hartford, and State of Connecticut, on this 19th day of November 2004. TIC SEPARATE ACCOUNT ELEVEN FOR VARIABLE ANNUITIES (Registrant) THE TRAVELERS INSURANCE COMPANY (Depositor) By: *GLENN D. LAMMEY ---------------------------------------------- Glenn D. Lammey, Chief Financial Officer, Chief Accounting Officer As required by the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities indicated on the 19th day of November 2004. *GEORGE C. KOKULIS Director, President and Chief Executive - ----------------------------------- Officer (Principal Executive Officer) (George C. Kokulis) *GLENN D. LAMMEY Director, Chief Financial Officer, Chief - ----------------------------------- Accounting Officer (Principal Financial (Glenn D. Lammey) Officer) *MARLA BERMAN LEWITUS Director - ----------------------------------- (Marla Berman Lewitus) *KATHLEEN L. PRESTON Director - ----------------------------------- (Kathleen L. Preston) *By: /s/ Kathleen A. McGah Assistant Secretary and Deputy General Counsel EXHIBIT INDEX EXHIBIT NO. DESCRIPTION - ----------- ----------- 4. Form of Guaranteed Minimum Withdrawal Rider. EX-4 2 c34474_ex4.txt GUARANTEED MINIMUM WITHDRAWAL RIDER CONTRACT NUMBER: [SPECIMEN] RIDER EFFECTIVE DATE: [NOVEMBER 1, 2004] The Rider Effective Date is the date this rider is issued for attachment to Your Contract/Certificate (hereinafter collectively referred to as the Contract). This rider is effective during the accumulation phase of the Contract. Loans will not be allowed under Your Contract once this rider is effective. Except where this rider provides otherwise, it is subject to all the conditions and limitations of the Contract. SUMMARY OF BENEFITS This rider provides a guaranteed minimum withdrawal benefit that gives You the right to make periodic partial surrenders/withdrawals (hereinafter referred to as partial withdrawals) as described below, even if Your Contract Value reduces to zero. [You have the right to "Reset" Your benefits under this rider at certain intervals as described under the section entitled "Reset of the RBB and AWB". We may modify the charge for this rider if You elect to Reset as described under the "Rider Charge" section.] Rider Effective Date Anniversary Definition: A Rider Effective Date Anniversary is defined as the yearly recurrence of the Rider Effective Date. REMAINING BENEFIT BASE (RBB) Definition: The Remaining Benefit Base at any time is the total guaranteed amount available for future partial withdrawals under this rider. However, at any time You may withdraw an amount up to Your Contract Value, subject to the provisions of this rider and Your Contract. At any time, Your RBB is subject to a maximum RBB of [$1,000,000] without home office approval. For the purpose of determining the maximum RBB subject to home office approval under this rider, we reserve the right to treat one or more deferred variable annuity Contracts issued by Us to You with this rider attached in the same calendar year as one Contract. Your RBB is determined/recalculated at specified times as described below: INITIAL RBB If this rider is effective on the Contract Date, then the initial RBB equals the initial Purchase Payment. If the Rider Effective Date is later than the Contract Date, then the initial RBB equals the Contract Value on the Rider Effective Date, less any purchase payment credits applied within the [12] months prior to the Rider Effective Date. WHEN A SUBSEQUENT PURCHASE PAYMENT IS MADE Upon each subsequent Purchase Payment, the RBB is recalculated to equal the sum of the RBB immediately prior to receipt of the subsequent Purchase Payment, plus 100% of the subsequent Purchase Payment not including purchase payment credits, if any. We reserve the right not to include subsequent Purchase Payments in the calculation of the RBB. WHEN A PARTIAL WITHDRAWAL IS MADE Whenever a partial withdrawal is made, the RBB will be recalculated and will equal the amount determined in either (a) or (b) as follows: (a) the RBB will be recalculated to equal the RBB immediately prior to the partial withdrawal, less the amount of the partial withdrawal if the total amount of all partial withdrawals taken since the most recent Rider Effective Date Anniversary, including the current partial withdrawal, is equal to or less than the AWB immediately prior to the partial withdrawal. (b) the RBB will be recalculated and subject to a Partial Withdrawal Reduction (defined below) if the total amount of all partial withdrawals taken since the most recent Rider Effective Date Anniversary, including the current partial withdrawal, exceeds the AWB immediately prior to the withdrawal. [The Partial Withdrawal Reduction will be the greater of the "Partial Withdrawal Reduction" and the dollar amount withdrawn. The Partial Withdrawal Reduction is equal to 1) the RBB in effect immediately prior to the reduction for the partial withdrawal, multiplied by 2) the amount of the partial withdrawal divided by 3) the Contract Value immediately prior to the partial withdrawal, less any purchase payment credits received within the [12] months prior to that withdrawal.] For purposes of this rider, the term "partial withdrawal" includes any applicable contingent deferred sales charges/amounts deducted on surrender and taxes. ANNUAL WITHDRAWAL BENEFIT (AWB) Definition: The Annual Withdrawal Benefit is the maximum amount available for withdrawal in each 12 month period beginning on the Rider Effective Date, without incurring a Partial Withdrawal Reduction to the AWB. If You choose to receive only a portion of, or none of, Your AWB in any given 12 month period since the Rider Effective Date, Your AWB will not be increased, as the AWB is not cumulative from year to year. If You are making withdrawals that are subject to a Tax-Qualified Distribution Program (described below), You may be allowed to make withdrawals that exceed the AWB without incurring a Partial Withdrawal Reduction to the AWB. Your AWB is determined/recalculated at specified times as described below: INITIAL AWB: Your initial AWB will be determined at the time of the first partial withdrawal taken under the Contract. Your initial AWB will equal [10%] of the RBB immediately prior to the first partial withdrawal, if the first partial withdrawal is taken on or after the [third] Rider Effective Date Anniversary. The initial AWB will equal [5%] of Your RBB immediately prior to the first partial withdrawal, if the first partial withdrawal is taken prior to the [third] Rider Effective Date Anniversary. WHEN A SUBSEQUENT PURCHASE PAYMENT IS MADE: Upon each subsequent Purchase Payment after the first partial withdrawal, the AWB is recalculated and is equal to the sum of the AWB immediately prior to receipt of the subsequent Purchase Payment, plus a percentage of the subsequent Purchase Payment. The percentage of the subsequent purchase payment will equal the percentage of the RBB ([5%] or [10%]) used in determining the initial AWB. We will not include the subsequent Purchase Payment in the calculation of the AWB, if that payment is not included in the calculation of the RBB. WHEN A PARTIAL WITHDRAWAL IS MADE UNDER THE AWB: Whenever a partial withdrawal is made, the AWB will be equal to the amount determined in either (a) or (b) as follows: (a) If the total amount of all partial withdrawals taken since the most recent Rider Effective Date Anniversary, including the current partial withdrawal, is equal to or less than the AWB immediately prior to the partial withdrawal, the AWB will not be recalculated. (b) If the total amount of partial withdrawals taken since the most recent Rider Effective Date Anniversary, including the current partial withdrawal, exceeds the AWB immediately prior to the withdrawal, the AWB will be recalculated by reducing it by a Partial Withdrawal Reduction as described below: [The Partial Withdrawal Reduction is equal to 1) the AWB in effect immediately prior to the reduction for partial withdrawal, multiplied by 2) the RBB immediately after the withdrawal divided by 3) the RBB immediately prior to the partial withdrawal.] We will waive any applicable deferred sales charge/amount deducted on surrender for partial withdrawals that exceed any free withdrawal allowance under the Contract but are less than or equal to the AWB (or amount taken under a Tax-Qualified Distribution Program, if applicable). TAX-QUALIFIED DISTRIBUTION PROGRAMS Subject to the limitations described below, withdrawals made pursuant to one of the following Tax-Qualified Distribution Programs will not result in a Partial Withdrawal Reduction to the RBB and AWB as described in the RBB and AWB sections of this rider. Each withdrawal will reduce the RBB by the amount of the withdrawal, and will not affect the AWB. The following Tax-Qualified Distribution Programs are eligible: (1) distributions intended to satisfy the required minimum distribution rules under Internal Revenue Code ("Code") Section 401(a)(9) and the Treasury Regulations promulgated thereunder, as applicable, to a qualified retirement plan (Code Section 401), a tax-sheltered annuity (Code Section 403(b)), an individual retirement account (Code Sections 408(a)), an individual retirement annuity (Code Section 408(b)), or a qualified deferred compensation plan (Code Section 457), which required minimum distribution is calculated using the Uniform Life Table (described in Treasury Regulation Section 1.401(a)(9)-9, Q&A-2) and/or the Joint and Last Survivor Table (described in Treasury Regulation Section 1.401(a)(9)-9, Q&A-3), and for distributions where the employee (owner) dies before entire interest is distributed as described in Code Section 401(a)(9)(B)(iii) calculated using the Single Life Table (described in Treasury Regulation Section 1.401(a)(9)-9, Q&A-1), as appropriate (each table as in effect as of January 1, 2004); (2) distributions intended to satisfy the exception under Code Section 72(s)(2) to the required minimum distribution rules which apply after the death of the holder of a nonqualified annuity contract provided under Code Section 72(s)(1) for certain amounts payable over the life of a designated beneficiary; (3) distributions intended to satisfy the exception under Code Section 72(t)(2)(A)(iv) from the 10% additional tax on early distributions from qualified retirement plans imposed by Code Section 72(t)(1) for certain amounts payable as part of a series of substantially equal periodic payments made for the life (or life expectancy) of the employee or the joint lives (or joint life expectancies) of such employee and his designated beneficiary, provided, however, the amount of the substantially equal periodic payments must be calculated under the required minimum distribution method set forth in the Internal Revenue Service Notice 89-25, 1989-1 C.B. 662 in Q&A-12 as amended by Revenue Ruling 2002-62, 2002-42 I.R.B. 710 (substantially equal periodic payments calculated under the fixed annuitization method or the fixed amortization method described in Q&A-12 of Notice 89-25 will NOT be considered a Tax-Qualified Distribution Program); or (1) distributions intended to satisfy the exception under Code Section 72(q)(2)(D) from the 10% additional tax on early distributions from nonqualified annuity contracts imposed by Code Section 72(q)(1) for certain amounts payable as part of a series of substantially equal periodic payments made for the life (or life expectancy) of the Beneficiary or the joint lives (or joint life expectancies) of such Beneficiary and his designated beneficiary, provided, however, the amount of the substantially equal periodic payment must be calculated under the required minimum distribution method set forth in Internal Revenue Service Notice 89-25, 1989-1 C.B. 662 in Q&A-12 as amended by Internal Revenue Bulletin 2004 -9, Notice 2004-15, page 526. (substantially equal periodic payments calculated under the fixed annuitization method or the fixed amortization method described in Q&A-12 of Notice 89-25 will NOT be considered a Tax-Qualified Distribution Program). Limitations on Tax-Qualified Distribution Programs: You are subject to the following limitations if you enroll in a Tax-Qualified Distribution Program: (1) You must enroll in the administrative program that we offer to make payments under each Tax-Qualified Distribution Program. If You do not enroll or if You cancel Your enrollment, You can continue to make withdrawals under this rider, however Your RBB and AWB will be calculated according to the sections of this rider entitled Annual Withdrawal Benefit (AWB) and Remaining Benefit Base (RBB) described above, and may be subject to a Partial Withdrawal Reduction. (2) During the time between each Rider Effective Date Anniversary (a "Rider Year"), all withdrawals under Your Contract must be made pursuant to the Tax-Qualified Distribution Program. If during any Rider Year You take any additional withdrawals that are not made pursuant to the Program, You can continue to make withdrawals under this rider, however for the remainder of the Rider Year Your RBB and AWB will be calculated according to the sections of this rider entitled Annual Withdrawal Benefit (AWB) and Remaining Benefit Base (RBB) described above, and may be subject to a Partial Withdrawal Reduction. (3) [If You are age [115] or over on the Rider Effective Date, the total withdrawals made each calendar year pursuant to a Tax-Qualified Distribution Program cannot exceed: A divided by B, plus A multiplied by [1%], where: A = Contract Value as of December 31st of the calendar year immediately preceding the withdrawal; and B = The life expectancy of the payee in years according to the life expectancy tables contained in Treasury Regulation Section 1.401(a)(9)-9 Q&A-2 (the Uniform Life Table) and Q&A-3 (the Joint and Last Survivor Table), respectively, as in effect on July 1, 2004. If You exceed this maximum, You can continue to make withdrawals under this rider, however for the remainder of the Calendar Year Your RBB and AWB will be calculated according to the sections of this rider entitled Annual Withdrawal Benefit (AWB) and Remaining Benefit Base (RBB) described above, and may be subject to a Partial Withdrawal Reduction. At our sole discretion, We may increase the maximum calculated above to conform with changes in the Code and Treasury Regulations that impact the amount required to be distributed according to the Tax-Qualified Distribution Program.] [ROLL-UP INCREASE BENEFIT] If withdrawals are not made from this Contract during Rider Years [0] to [10], the RBB and AWB under this Rider will be increased by [1%] on the [10th] rider anniversary] [RESET OF THE RBB AND AWB At the times determined below, You may elect in a written form acceptable to Us to Reset the RBB and the AWB. You may not Reset if You are over age [115] and are taking withdrawals under a Distribution Program described above. RBB RESET Beginning on the [5th ] Rider Effective Date Anniversary, You have the option to reset (hereinafter referred to as the Reset) the RBB to an amount equal to [100%] of the then current Contract Value, less any purchase payment credits applied within the [12] months prior to the Reset Date. Once a Reset has been elected, another Reset may not be elected until on or after the [5th ] anniversary of the latest Reset Date. During the time that You are eligible to elect a Reset, We may allow You to Reset Your RBB only on a Rider Effective Date Anniversary. AWB RESET Upon Reset, the AWB will be recalculated as a percentage of the Reset RBB value. The percentage will equal the percentage of the RBB ([5%] or [10%]) used in determining the initial AWB. WHEN A PARTIAL WITHDRAWAL IS MADE AFTER A RESET Whenever a partial withdrawal is made after a Reset, the recalculation of the RBB and AWB as described above will be modified by substituting the "most recent Reset Date Anniversary" in place of the "most recent Rider Effective Date Anniversary." The Reset Date Anniversary is defined as the yearly recurrence of the Reset Date.] CONTRACT VALUE REDUCES TO ZERO If Your Contract Value reduces to zero, and the RBB is greater than zero, the AWB will continue to be paid to You until the RBB is reduced to zero. The total annual payment(s) will equal the AWB, but will not exceed the RBB. All other rights under Your Contract cease, and We will no longer accept subsequent Purchase Payments. All other optional endorsements are terminated without value. Upon Your death, Your Beneficiary(s) will receive the remaining scheduled payments. No other death benefit or Enhanced Stepped-Up Provision (if any) will be paid. [INVESTMENT LIMITATIONS AND RESTRICTIONS UNDER THIS RIDER We reserve the right to restrict allocations to a Funding Option or limit the percentage of Contract value that may be allocated to a Funding Option at any time. We also reserve the right to require periodic rebalancing of Contract value allocated to Funding Options according to specified percentages. We will provide no less than 30 days advance written notice if we exercise Our right to restrict or limit allocations to a Funding Option and/or require periodic rebalancing between Funding Options. If We restrict allocations to a Funding Option, as of the effective date of the restriction, We will no longer allow additional Purchase Payments to be applied, or transfers of Contract value to be allocated into the restricted Funding Option. Any Contract value previously allocated to a restricted Funding Option will not be subject to the restriction. If We impose a limit on the percentage of Contract value allocated to a Funding Option, as of the effective date of the restriction, We will impose the limit on all subsequent allocations.] RIDER CHARGE The charge for this rider is a daily charge equivalent to an annual charge of [1.00%] of the daily value of the underlying funds, subject to a guaranteed maximum charge of [1.00%]. [The charge for this rider may change if You elect to Reset the RBB. However, the rider charge will never exceed the guaranteed maximum charge. If the RBB is not Reset by the Contract Owner, the charge established on the Rider Effective Date will not change.] The charge for this rider will be discontinued once We begin paying a benefit under an Annuity/Income Option or if this Contract is assigned. Contract Continuation by Surviving Spouse or Beneficiary If the surviving spouse or Beneficiary continues the Contract under the provisions of Spousal or Beneficiary Continuation provisions, if any, and this rider is effective at the time of continuation, then the same terms/conditions that applied to the Owner under this rider would continue to apply to the surviving spouse/Beneficiary who continued the Contract. Effect on the Death Benefit Except as described above under the "Contract Continuation by Surviving Spouse or Beneficiary provision," the provisions of this rider will terminate upon the death of the Owner and the death benefit amount will be determined under the death benefit provisions of the Contract. However, if Your Contract provides for a death benefit amount that is the greatest of multiple benefits including the Adjusted Purchase Payment, the Adjusted Purchase Payment provision is deleted and replaced with "total Purchase Payments made to the Contract, less any prior withdrawals." RIDER TERMINATION [You may terminate this rider at any time after the [5th] Rider Effective Date Anniversary. You must elect termination in a written form acceptable to Us.] This rider will automatically terminate upon the Maturity Date of the Contract, if Your Contract is assigned, or if this rider is exchanged for a similar rider offered by Us. THE TRAVELERS INSURANCE COMPANY -----END PRIVACY-ENHANCED MESSAGE-----