<PAGE> 1
File Nos: 33-13053
811-5091
SCHEDULE 14A
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:
/X/ Preliminary Proxy Statement
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
THE TRAVELERS TIMED AGGRESSIVE STOCK ACCOUNT
FOR VARIABLE ANNUITIES
--------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
Not Applicable
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(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box);
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11.
1) Title of each class of securities to which transaction
applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth the
amount on which the filing fee is calculated and state how it
was determined):
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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THE TRAVELERS TIMED AGGRESSIVE STOCK ACCOUNT
FOR VARIABLE ANNUITIES
ONE TOWER SQUARE
HARTFORD, CONNECTICUT 06183
NOTICE OF ANNUAL MEETING
March 4, 1996
To Variable Annuity Contract Owners:
Notice is hereby given that the Annual Meeting of Variable Annuity
Contract Owners of The Travelers Timed Aggressive Stock Account for Variable
Annuities will be held at its offices at One Tower Square, Hartford,
Connecticut, on Friday, April 19, 1996, at 8:30 a.m. for the following
purposes:
1. To elect five (5) members of the Board of Managers to serve until
the next annual meeting and until their successors are elected
and qualify.
2. To ratify the selection of Coopers & Lybrand L.L.P. as
independent accountants of Account TAS for the year ending
December 31, 1996.
3. To approve an amendment to the Investment Advisory Agreement
between Account TAS and The Travelers Investment Management
Company.
4. To approve the continuation of the Distribution and Management
Agreement among Agreement among Account TAS, The Travelers
Insurance Company and Tower Square Securities, Inc.
5. To act on any and all other business as may properly come before
the meeting.
The close of business on February 16, 1996 has been fixed as the
record date for the determination of Variable Annuity Contract Owners entitled
to notice of and to vote at said meeting.
By order of the Board of Managers.
ERNEST J. WRIGHT, SECRETARY
Please complete and return the enclosed proxy card as soon as possible
in the post-paid envelope provided. Your prompt response is appreciated.
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THE TRAVELERS TIMED AGGRESSIVE STOCK ACCOUNT
FOR VARIABLE ANNUITIES
PROXY STATEMENT FOR THE ANNUAL MEETING OF VARIABLE ANNUITY CONTRACT OWNERS
TO BE HELD ON FRIDAY, APRIL 19, 1996
THE BOARD OF MANAGERS OF THE TRAVELERS TIMED AGGRESSIVE STOCK ACCOUNT
FOR VARIABLE ANNUITIES (ACCOUNT TAS) SOLICITS YOUR PROXY FOR USE AT THE ANNUAL
MEETING OF CONTRACT OWNERS AND AT ANY ADJOURNMENT OF IT. The annual meeting
will be held at 8:30 a.m. on Friday, April 19, 1996, at the offices of Account
TAS, One Tower Square, Hartford, Connecticut. This proxy material is expected
to be mailed to Contract Owners on or about March 4, 1996.
VOTE BY PROXY
A proxy card is enclosed for use at the meeting. The proxy card may
be revoked at any time before it is voted by sending a written notice of
revocation to Account TAS' Secretary or by appearing in person to vote at the
meeting. All proxy cards which are properly executed and received in time and
not so revoked will be voted at the meeting in accordance with the instructions
on them, if any. If no specification is made, the proxy card will be voted for
the election of the five nominees for members of the Board of Managers listed
in this proxy statement, for the ratification of the selection of Coopers &
Lybrand L.L.P. as independent accountants for the fiscal year ending December
31, 1996, for the approval of an amendment to the Investment Advisory Agreement
between Account TAS and The Travelers Investment Management Company ("TIMCO")
and for the approval of the continuation of the Distribution and Management
Agreement among Account TAS, The Travelers Insurance Company ("Travelers
Insurance") and Tower Square Securities, Inc. ("Tower Square") (formerly
Travelers Equities Sales, Inc.).
COST OF SOLICITATION
The cost of soliciting these proxies will be borne by Travelers
Insurance, the issuer of the variable annuity contracts that use Account TAS as
an investment alternative. Proxies may be solicited by directors, officers or
employees of Travelers Insurance on behalf of the Board of Managers of Account
TAS, either in person, by telephone or by telegram.
CONTRACT OWNERS AND THE VOTE
Only Contract Owners of record at the close of business on February
16, 1996 (the record date) will be entitled to notice of and to vote at the
annual meeting. On the record date, there were __________ units of Account TAS
outstanding and entitled to be voted at the meeting. The number of full and
fractional votes, which you as a Contract Owner are entitled to cast is set
forth on the enclosed proxy card. As of January 31, 1996, no single person or
entity owned beneficially a contract or contracts entitling it to cast more
than 5% of the total outstanding votes.
VOTE REQUIRED
Approval of Proposals 1 and 2 requires the affirmative vote of the
holders of a majority of the voting securities present at the meeting. Approval
of Proposals 3 and 4 require the affirmative "vote of a majority of the
outstanding voting securities" of Account TAS. Under the Investment Company
Act of 1940, as amended ("1940 Act"), a "vote of a majority of the outstanding
voting securities" means the affirmative vote of (a) 67% of the outstanding
voting securities represented at the meeting, if more than
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50% of the outstanding voting securities are represented, or (b) more than 50%
of the outstanding voting securities, whichever is less.
ANNUAL REPORT
Account TAS' Annual Report containing financial statements for the
fiscal year ended December 31, 1995, was mailed to Contract Owners of record as
of December 31, 1995. Copies of the Annual Report may be obtained by writing
to The Travelers Insurance Company, Annuity Services, One Tower Square,
Hartford, Connecticut 06183-5030, or by calling (860) 277-0111.
1. ELECTION OF THE BOARD OF MANAGERS
At the meeting, five members of the Board of Managers are to be
elected to hold office until the next annual meeting and until their successors
shall have been elected and qualify. Unless this authority has been withheld
on the proxy card, it is intended that the proxy card will be voted for the
election of the five nominees named below. If any of the nominees are unable
to serve at the time of the meeting, and there is no reason to believe they
will not serve, the persons named as proxies may vote for any other person or
persons as they may determine at their discretion. The following nominees are
recommended by the Nominating Committee pursuant to their meeting held on
January 18, 1996.
<TABLE>
<CAPTION>
Contracts
Nominee for Owned
Member Principal Occupation 12/31/95
------------- -------------------- --------
<S> <C> <C>
Heath B. McLendon* Managing Director (1993-present), Smith Barney Inc. ("Smith Barney"); None
Age 62 Chairman (1993-present), Smith Barney Strategy Advisors, Inc.;
Member Since 1995 President (1994-present), Smith Barney Mutual Funds Management Inc.;
Chairman and Director of forty-one investment companies associated
with Smith Barney; Chairman, Board of Trustees, Drew University;
Trustee, The East New York Savings Bank; Advisory Director, First
Empire State Corporation; Chairman, Board of Managers, seven Variable
Annuity Separate Accounts of The Travelers Insurance Company+;
Chairman, Board of Trustees, five Mutual Funds sponsored by The
Travelers Insurance Company++; prior to July 1993, Senior Executive
Vice President of Shearson Lehman Brothers Inc.
Knight Edwards Of Counsel (1988-present), Partner (1956-1988), Edwards & Angell, None
Age 72 Attorneys; Member, Advisory Board (1973-1994), thirty-one mutual
Member Since 1987 funds sponsored by Keystone Group, Inc.; Member, Board of Managers,
seven Variable Annuity Separate Accounts of The Travelers Insurance
Company+; Trustee, five Mutual Funds sponsored by The Travelers
Insurance Company++.
Robert E. McGill, III Retired manufacturing executive. Director (1983-1995), Executive Vice None
Age 64 President (1989-1994) and Senior Vice President, Finance and
Member Since 1987 Administration (1983-1989), The Dexter Corporation (manufacturer of
specialty chemicals and materials); Vice Chairman (1990-1992),
Director (1983-1995), Life Technologies, Inc. (life
science/biotechnology products); Director (1994-present), The
</TABLE>
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<TABLE>
<S> <C> <C>
Connecticut Surety Corporation (insurance); Director (1995-present)
Calbiochem Novachem International (life science/biotechnology
products); Director (1995-present), Chemfab Corporation (manufacturer
of specialty materials); Member, Board of Managers, seven Variable
Annuity Separate Accounts of The Travelers Insurance Company+;
Trustee, five Mutual Funds sponsored by The Travelers Insurance
Company++.
Lewis Mandell Dean, College of Business Administration (1995-present), Marquette None
Age 53 University; Professor of Finance (1980-1995) and Associate Dean
Member Since 1990 (1993-1995), School of Business Administration, and Director, Center
for Research and Development in Financial Services (1980-1995),
University of Connecticut; Director (1992-present), GZA
Geoenvironmental Tech, Inc. (engineering services); Member, Board of
Managers, seven Variable Annuity Separate Accounts of The Travelers
Insurance Company+; Trustee, five Mutual Funds sponsored by The
Travelers Insurance Company++.
Frances M. Hawk Portfolio Manager (1992-present), HLM Management Company, Inc. None
Age 48 (investment management); Assistant Treasurer, Pensions and Benefits
Member Since 1991 Management (1989-1992), United Technologies Corporation (broad-based
designer and manufacturer of high technology products); Member, Board
of Managers, seven Variable Annuity Separate Accounts of The
Travelers Insurance Company+; Trustee, five Mutual Funds sponsored by
The Travelers Insurance Company++.
</TABLE>
+ These seven Variable Annuity Separate Accounts are: 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; The Travelers Timed Aggressive Stock
Account for Variable Annuities and The Travelers Timed Bond Account for
Variable Annuities.
++ These five Mutual Funds are: Capital Appreciation Fund; Cash Income
Trust; High Yield Bond Trust; Managed Assets Trust and The Travelers
Series Trust.
* Mr. McLendon is an "interested person" within the meaning of the 1940
Act by virtue of his position as Director of The Travelers Investment
Management Company ("TIMCO"), the investment adviser to Account TAS. TIMCO is
a wholly owned subsidiary of Smith Barney Holdings Inc., which is a wholly
owned subsidiary of Travelers Group Inc. Mr. McLendon also owns shares and
options to purchase shares of Travelers Group Inc., the indirect parent of The
Travelers Insurance Company.
Prior to each annual meeting of Contract Owners at which members of
the Board of Managers are to be elected, or if a vacancy in the Board of
Managers occurs between such meetings, the Nominating Committee of the Board of
Managers recommends candidates for nomination as members of the Board of
Managers. Account TAS' Nominating Committee consists of those members of the
Board of Managers
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not affiliated as employees of Travelers Group Inc. or its subsidiaries.
Currently, these are Knight Edwards, Robert E. McGill, III, Lewis Mandell and
Frances M. Hawk. During the fiscal year ended December 31, 1995, the
Nominating Committee held one meeting. The Committee will consider potential
nominees recommended by Contract Owners. Any Contract Owner desiring to
present a candidate to the Committee for consideration should submit the name
of the candidate, in writing, to Account TAS' Secretary prior to December 31,
1996.
MEETINGS
There were four meetings of the Board of Managers of Account TAS
during 1995. All members of the Board of Managers attended at least 75% of the
aggregate of its meetings and the meetings of the committees of which they
were members.
REMUNERATION OF THE BOARD OF MANAGERS
Members of the Board of Managers who are also employees of Travelers
Group Inc. or its subsidiaries are not entitled to any fee. Members of the
Board of Managers who are not affiliated as employees of Travelers Group Inc.
or its subsidiaries receive an aggregate annual retainer of $17,000 for service
on the Boards of the seven Variable Annuity Separate Accounts established by
Travelers Insurance and the five Mutual Funds sponsored by Travelers Insurance.
They also receive an aggregate fee of $2,000 for each meeting of such Boards
attended. As indicated under "Distribution and Management Agreement" on page
9, such compensation is currently paid by Travelers Insurance.
2. RATIFICATION OF THE SELECTION OF INDEPENDENT ACCOUNTANTS
It is proposed that Contract Owners ratify the action of the Board of
Managers, taken on January 18, 1996 by a unanimous vote, cast in person,
including those members of the Board of Managers who are not interested persons
of Account TAS, to select the firm of Coopers & Lybrand L.L.P. as the
independent accountants of Account TAS for the fiscal year ending December 31,
1996. A representative from Coopers & Lybrand L.L.P. is expected to be present
at the meeting with the opportunity to make a statement if desired, and is
expected to be available to respond to appropriate questions.
The only services provided to Account TAS by Coopers & Lybrand L.L.P.
were in connection with the audit function for the year 1995 and included
primarily the examination of Account TAS' financial statements and the review
of filings made with the Securities and Exchange Commission.
Account TAS' Audit Committee consists of those members of the Board of
Managers not affiliated as employees of Travelers Group Inc. or its
subsidiaries. Currently, these are Knight Edwards, Robert E. McGill, III,
Lewis Mandell and Frances M. Hawk. The Audit Committee reviews the services
performed by Coopers & Lybrand L.L.P. During the fiscal year ended December
31, 1995, the Audit Committee held one meeting.
3 APPROVAL OF AN AMENDED INVESTMENT ADVISORY AGREEMENT BETWEEN ACCOUNT
TAS AND TIMCO.
The Board of Managers has approved, and recommends that Contract
Owners of Account TAS approve, a proposal to amend the Investment Advisory
Agreement between Account TAS and The Travelers Investment Management Company
("TIMCO"). The purpose of the proposed amendment to the Investment Advisory
Agreement (the "proposed amendment") is to change the investment advisory fee
from an aggregate net asset value of the Account to a flat 0.35% of the average
daily net assets of Account TAS.
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TIMCO currently serves as investment adviser to Account TAS pursuant
to an Investment Advisory Agreement dated December 30, 1992 (the "Existing
Advisory Agreement"). The Existing Advisory Agreement was approved by a vote
of Contract Owners at their annual meeting held on April 23, 1993.
TIMCO has proposed a modification to the advisory agreement in order
to ensure that the fee level would be consistent with the resources that it has
committed to provide investment services to Account TAS, particularly the
development of its staff, systems and facilities required to implement a highly
disciplined approach to equity management. TIMCO has made a substantial
business investment in information management systems that allows it to seek
superior investment opportunities across a large universe of equity securities,
and to quantify and control portfolio risk. If approved, the proposed fee
level would continue to remain well below the competitive median advisory fee
for active equity funds in both the capital appreciation and growth categories.
PROPOSED AMENDMENT TO THE ADVISORY AGREEMENT
The current advisory fee deducted daily and paid weekly to TIMCO by
Account TAS is as follows:
<TABLE>
<CAPTION>
Aggregate
Annual Net Asset Value
Management Fee of the Account
-------------- ------------------
<S> <C> <C>
0.50% of the first $ 20,000,000, plus
0.25% of the next $ 80,000,000, plus
0.20% of the next $200,000,000, plus
0.15% of amounts over $300,000,000
</TABLE>
The proposed amendment would change the annual advisory fee to a flat
rate of 35% of net assets effective May 1, 1996. For the fiscal year ended
December 31, 1995, the total advisory fees paid to TIMCO by Account TAS was
$215,043. If the proposed amendment had been in effect under the Existing
Advisory Agreement, the advisory fee paid to TIMCO would have been $232,512.
Paragraph 4 of the Existing Advisory Agreement is proposed to be
amended to read as follows:
"4. For the services rendered hereunder, TIMCO will receive an amount
equivalent on an annual basis to 0.35% of the average daily net assets
of Account TAS, such fees to be deducted on each valuation date."
With the exception of the proposed amendment to paragraph 4 set forth
above, all other terms and conditions of the Existing Agreement will remain the
same. The Existing Advisory Agreement provides that TIMCO shall:
1. obtain and evaluate pertinent economic, statistical and financial
data and other information relevant to the investment policy of
Account TAS, affecting the economy generally and individual
companies or industries, the securities of which are included in
Account TAS' portfolio or are under consideration for inclusion
therein;
2. be authorized to purchase supplemental research and other services
from brokers at additional cost to Account TAS;
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3. regularly furnish to the Board recommendations with respect to any
investment program for approval, modification or rejection by the
Board;
4. take such steps as are necessary to implement the investment
program approved by the Board; and
5. regularly report to the Board with respect to implementation of
the approved investment program and any other activities in
connection with the administration of the assets of Account TAS.
IMPACT OF PROPOSED ADVISORY FEE
The following table provides data concerning Account TAS' investment
advisory fees and total expenses for the last three fiscal years, and the
effect on those figures if the proposed amendment to the Existing Advisory
Agreement had been in effect:
<TABLE>
<CAPTION>
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
AVERAGE NET ASSETS $66,271,888 $93,157,942 $67,913,423
ACTUAL INVESTMENT ADVISORY FEES
Total . . . . . . . . . . . . . . . . . . . . . . . $ 215,043 279,503 213,623
Ratio of Advisory Fees to Average Net Assets . . . . .32% .30% .31%
IF PROPOSED ADVISORY AGREEMENT HAD BEEN IN EFFECT
Total Investment Advisory Fees . . . . . . . . . . . $ 232,512 $ 325,792 $ 238,008
Ratio of Advisory Fees to Average Net Assets . . . . .35% .35% .35%
RATIO OF TOTAL EXPENSES TO AVERAGE NET ASSETS
Actual 2.82% 2.77% 2.72%
Under Proposed Advisory Agreement 2.84% 2.82% 2.76%
</TABLE>
GENERAL
Section 15(a) of the 1940 Act prohibits any person from serving as
investment adviser to a registered investment company except pursuant to a
written contract that has been approved by a vote of a majority of the
outstanding voting securities of such registered investment company.
Accordingly, the proposed amendment to the Investment Advisory Agreement is
being submitted to Contract Owners to vote on its approval.
As required by the 1940 Act, the Investment Advisory Agreement, as amended,
will continue in effect for a period of more than two years from the date of
its execution only so long as its continuance is specifically approved at least
annually (I) by a vote of the majority of the Board of Managers, or (ii) by a
vote of a majority of the outstanding voting securities of Account TAS. In
addition, and in either event, the terms of the Investment Advisory Agreement
must be approved annually by a vote of a majority of the Board of managers who
are not parties to, or interested persons of any party to, the Investment
Advisory Agreement, cast in person at a meeting called for the purpose of
voting on such approval and at which the Board of Managers is furnished such
information as may be reasonably necessary to evaluate the terms of the
Investment Advisory Agreement. The Investment Advisory Agreement further
provides that it will terminate automatically upon assignment; may be amended
only with prior approval of a majority of the outstanding voting securities of
Account TAS; may be terminated without the payment of any penalty at any time
upon sixty days' notice by the Board of Managers or by a vote of a majority of
the outstanding
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voting securities of Account TAS; and may not be terminated by TIMCO without
prior approval of a new investment advisory agreement by a vote of a majority
of the outstanding voting securities of Account TAS.
If approved by Contract Owners, the proposed amendment will take
effect on May 1, 1996. If the proposed amendment is not approved, the Existing
Advisory Agreement and advisory fee will remain in effect.
BOARD RECOMMENDATION
At its meeting held on January 18, 1996, the Board of Managers
unanimously approved the proposed amendment described above. The Board's
conclusion that the proposed advisory fee structure is appropriate was based
on, among other things, a detailed review of Account TAS' competitive
investment performance, the quality and nature of TIMCO's advisory and related
services to Account TAS, the competitiveness of the proposed advisory fee
structure and the resulting expense ratio in relation to fees and expense
ratios of other similarly managed investment alternatives.
Accordingly, the Board of Managers unanimously voted to approve the
proposed amendment to the Investment Advisory Agreement and to recommend that
Contract Owners vote FOR such amendment.
4. APPROVAL OF THE CONTINUATION OF THE DISTRIBUTION AND MANAGEMENT
AGREEMENT
It is proposed that Contract Owners approve the continuation of the
Distribution and Management Agreement among Account TAS, Travelers Insurance
and Tower Square which contains a provision relating to the method of payment
of market timing fees.
Account TAS is one of four timed Variable Annuity Managed Separate
Accounts (the "Timed Accounts") established for the purposes of segregating the
assets of Variable Annuity Contract Owners who enter into third party market
timing services agreements ("Timed Contract Owners"), and avoiding the adverse
effects that transfers made by market timers for Timed Contract Owners could
have on the interests of non-Timed Contract Owners. Copeland Financial
Services, Inc. ("Copeland"), a registered investment adviser and an affiliate
of Travelers Insurance, offers market timing services to the Timed Contract
Owners pursuant to the terms of a market timing services agreement. For these
services, Copeland charges a one-time $30 application fee and an additional fee
equivalent to an annual rate of 1.25% of the current value of assets that it
times.
While the market timing agreements are between the Timed Contract
Owners and Copeland, Travelers Insurance is also a signatory to the agreement
and is solely responsible for payment of the fee to Copeland. Paragraph 5 of
the Distribution and Management Agreement provides that Account TAS will
reimburse Travelers Insurance for the payment of the market timing fees to
Copeland. Travelers Insurance seeks such reimbursement through the deduction of
a daily asset charge against the assets of Account TAS. Travelers Insurance
does not retain any portion of the fee and is not compensated for any costs
incurred in connection with the payment or deduction of the fees. While the
Distribution and Management Agreement remains in effect, this is the sole
market timing fee payment method available to Timed Contract Owners.
On February 7, 1990, an Order was received from the Securities and
Exchange Commission granting certain exemptions from the 1940 Act necessary to
permit this method of payment of market timing fees. One of the conditions of
the Order was that the Distribution and Management Agreement be approved
annually by a majority of the outstanding voting securities of each Timed
Account. The continuation of the Distribution and Management Agreement was
last approved by Timed Contract Owners on April 28, 1995.
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The Board of Managers of Account TAS has caused Account TAS to execute
the Distribution and Management Agreement in order to facilitate this
convenient payment method for Timed Contract Owners. However, in causing
Account TAS to execute this Agreement, the Board of Managers has not approved
or made any recommendations with respect to the suitability of market timing
services in general, the quality or level of services provided by the current
or any future market timers, or the level of the market timing fees. Because
the market timing services will continue to be provided pursuant to individual
agreements between Timed Contract Owners and Copeland, the Board of Managers
does not exercise any supervisory or oversight role with respect to market
timing services or the fees charged therefor.
Timed Contract Owners receive a quarterly statement indicating the
estimated dollar amount of market timing fees deducted from their Timed
Accounts during the quarter. Timed Contract Owners also receive a chart
comparing the performance of their selected timing strategy for the prior
twelve months either with the return of a comparable non-Timed Account or, upon
prior approval of the Securities and Exchange Commission, with the return of an
appropriate index.
A "vote of a majority of the outstanding voting securities" of Account
TAS is required to approve the continuation of the Distribution and Management
Agreement. If Contract Owners in Account TAS do not approve this matter,
market timing fees relating to Account TAS will be paid by pre-authorized
partial surrenders, to the extent permitted by tax law, or by sending a check
to Copeland, and the Distribution and Management Agreement will continue in
effect, with the exception of paragraph 5, which contains these provisions.
A copy of the Distribution and Management Agreement is attached hereto
as Exhibit A.
ADDITIONAL INFORMATION
CONTRACT OWNER PROPOSALS
All Contract Owner proposals to be included in the Proxy Statement for
the next annual meeting must be received by Account TAS' Secretary at One Tower
Square, Hartford, Connecticut 06183 by November 1, 1996.
It is suggested that Contract Owners submit their proposals by
Certified Mail--Return Receipt Requested. The Securities and Exchange
Commission has adopted certain requirements which apply to any proposals of
Contract Owners.
THE INVESTMENT ADVISER
TIMCO, One Tower Square, Hartford, Connecticut is a registered
investment adviser which has provided investment advisory services since its
incorporation in 1967. TIMCO currently manages assets of over $1.1 billion.
TIMCO is a wholly owned subsidiary of Smith Barney Holdings Inc. (388 Greenwich
Street, New York, New York), a wholly owned subsidiary of Travelers Group Inc.
(388 Greenwich Street, New York, New York). As of December 31, 1995, no person
or entity was known to be A BENEFICIAL OWNER OF 10% or more of the voting
securities of Travelers Group Inc.
The principal executive officers and directors of TIMCO are set forth
in the following table along with their addresses and principal occupations, as
well as their respective positions with registered investment companies for
which TIMCO currently acts as investment adviser.
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<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------
NAME AND ADDRESS OF POSITION WITH POSITION WITH
PRINCIPAL EXECUTIVE THE TRAVELERS INVESTMENT INVESTMENT PRINCIPAL
OFFICER AND DIRECTORS MANAGEMENT COMPANY COMPANIES(1) OCCUPATION
- --------------------- ------------------ ------------ ----------
<S> <C> <C> <C>
Jeffrey B. Lane(2) Director and Chairman Vice Chairman,
Smith Barney Inc.
Heath B. McLendon(2) Director Chairman, Board of Managing Director
Managers/Trustees Smith Barney Inc.
Kent A. Kelley(3) Director and Chief Chief Executive Officer
Executive Officer TIMCO
Sandip A. Bhagat(3) Director and President President
TIMCO
James W. Churm(2) Corporate Secretary Senior Vice President
Managing Counsel
Smith Barney Inc.
</TABLE>
(1) Investment companies currently managed by TIMCO: The Travelers Growth
and Income Stock 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; The Travelers
Timed Aggressive Stock Account for Variable Annuities; Capital
Appreciation Fund and Managed Assets Trust.
(2) The address for the above-named persons is Smith Barney Inc., 388
Greenwich Street, New York, New York.
(3) The address for the above-named persons is The Travelers Investment
Management Company, One Tower Square, Hartford, Connecticut.
- --------------------------------------------------------------------------------
Investment advice and decisions for each of TIMCO's clients are made
in accordance with their investment objectives and policies. Securities
considered for investment by Account TAS are also usually considered
appropriate for investment by other clients served by TIMCO. When the same
investment advice or decision is made for more than one client at or about the
same time and purchases or sales are made pursuant thereto, transactions in
such securities are generally allocated daily among the clients pro rata in
relation to the size of the order, using the daily average price. It is
recognized that in some cases this practice could have a detrimental effect on
the price or volume of securities being bought or sold by Account TAS, while in
other cases it may produce better executions or lower brokerage rates.
DISTRIBUTION AND MANAGEMENT AGREEMENT
Tower Square (formerly known as Travelers Equities Sales, Inc.), One
Tower Square, Hartford, Connecticut, is the principal underwriter for Account
TAS. Tower Square is a wholly owned subsidiary of The Travelers Insurance
Group Inc., which is an indirectly wholly owned subsidiary of Travelers Group
Inc.
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Under the terms of the Distribution and Management Agreement,
Travelers Insurance provides all administrative services and mortality and
expense risk guarantees related to variable annuity contracts issued by
Travelers Insurance and funded by Account TAS. For providing mortality and
expense risk guarantees, Travelers Insurance receives compensation in an amount
equivalent to 1.25% on an annual basis of the value of the net assets of
Account TAS. Tower Square performs all sales functions relative to the sale and
distribution of the Contracts. Tower Square receives no compensation for its
services as principal underwriter.
During 1995, Travelers Insurance received $_______ for sales and
administrative expenses, and $_________ for mortality and expense guarantees,
for a total of $_________ under the Distribution and Management Agreement.
Travelers Insurance pays all sales costs and costs of qualifying Account TAS
and its contracts with regulatory authorities, as well as all printing costs
and costs of proxy solicitation, sales literature, custodian, accountants' and
legal fees, and compensation of the Board of Managers. Travelers Insurance
also provides without cost to Account TAS all necessary office space,
facilities and personnel to manage its affairs.
The Distribution and Management Agreement will, as required by the
1940 Act, continue in effect for a period more than two years from the date of
its execution only so long as its continuance is specifically approved at least
annually (i) by a vote of a majority of the Board of Managers, or (ii) by a
vote of a majority of the outstanding voting securities of Account TAS. In
addition, and in either event, the terms of the Distribution and Management
Agreement must be approved annually by a vote of a majority of the Board of
Managers who are not parties to, or interested persons of any party to, the
Distribution and Management Agreement, cast in person at a meeting called for
the purpose of voting on such approval. Additionally, Contract Owners have
been asked to approve the continuation of the Distribution and Management
Agreement to allow Travelers Insurance to deduct amounts necessary to pay fees
to market timers which provide market timing investment advisory services to
Timed Contract Owners. If the continuation of the Distribution and Management
Agreement is approved by Contract Owners of Account TAS, Travelers Insurance
will continue to deduct amounts necessary to pay these fees and will, in turn,
pay such fees to the market timers. If Contract Owners do not approve such
continuation, the Agreement will continue in effect, with the exception of
paragraph 5 of the Agreement which contains these provisions.
The Board of Managers of Account TAS, including those members of the
Board of Managers who are not interested persons of Account TAS, voting in
person on January 18, 1996 at a meeting called for the purpose of voting on
such approval, by unanimous action voted to approve continuance of the
Distribution and Management Agreement.
4. OTHER BUSINESS
The Board of Managers knows of no other business to be presented at
the meeting. The proxy card gives the persons named in the proxy discretion to
vote according to their best judgment if any other business properly comes
before the meeting.
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EXHIBIT A
DISTRIBUTION AND MANAGEMENT AGREEMENT
DISTRIBUTION AND MANAGEMENT AGREEMENT (the "Agreement") made this 1st
day of February, 1995 by and among The Travelers Insurance Company, a
Connecticut stock insurance company (hereinafter the "Company"), Tower Square
Securities, Inc., a Connecticut general business corporation (hereinafter
"Tower Square"), and The Travelers Timed Aggressive Stock Account for Variable
Annuities (hereinafter "Account TAS"), a separate account of the Company
established by its Chairman of the Board and Chief Executive Officer on January
2, 1987 pursuant to a resolution of the Company's Board of Directors on August
4, 1967, pursuant to Section 38-154a of the Connecticut General Statutes. This
Agreement supersedes the Distribution and Management Agreement dated December
30, 1992 between the Company and Account TAS.
1. The Company hereby agrees to provide all administrative services
relative to variable annuity contracts and revisions thereof
(hereinafter "Contracts") sold by the Company, the net proceeds
of which or reserves for which are maintained in the Account
TAS.
2. Tower Square hereby agrees to perform all sales functions
relative to the Contracts. The Company agrees to reimburse
Tower Square for commissions paid, other sales expenses and
properly allocable overhead expenses incurred in performance
thereof.
3. For providing the administrative services referred to in
paragraph 1 above, and for reimbursing Tower Square for the
sales functions referred to in paragraph 2 above, the Company
will receive the deductions for sales and administrative
expenses which are stated in the Contracts.
4. The Company will furnish at its own expense and without cost to
Account TAS the administrative expenses of Account TAS,
including but not limited to:
(a) office space in the offices of the Company or in such
other place as may be agreed upon from time to time, and
all necessary office facilities and equipment;
(b) necessary personnel for managing the affairs of Account
TAS, including clerical, bookkeeping, accounting and other
office personnel;
(c) all information and services, including legal services,
required in connection with registering and qualifying
Account TAS or the Contracts with federal and state
regulatory authorities, preparation of registration
statements and prospectuses, including amendments and
revisions thereto, all annual, semi-annual and periodic
reports, notices and proxy solicitation materials
furnished to variable annuity Contract Owners or
regulatory authorities, including the costs of printing
and mailing such items;
(d) the costs of preparing, printing, and mailing all sales
literature;
(e) all registration, filing and other fees in connection with
compliance requirements of federal and state regulatory
authorities;
(f) the charges and expenses of any custodian or depository
appointed by Account TAS for the safekeeping of its cash,
securities and other property;
(g) the charges and expenses of independent accountants
retained by Account TAS;
(h) expenses of Contract Owners' and Board of Managers'
meetings;
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<PAGE> 15
(i) all expenses of and compensation paid to Members of the
Board of Managers of Account TAS; and
(j) reimbursement for amounts paid by Account TAS for
indemnification of the Board of Managers of Account TAS,
the officers and agents of Account TAS pursuant to Article
VI of Account TAS's Rules and Regulations, provided that
in the case of any person who is a director, officer or
agent of the Company, the Company's obligation will be
limited to such amount as the Board of Directors of the
Company determines to be reasonable.
Provided, however, that the Company shall not be obligated to pay
capital gains taxes, and any other taxes based on income of, assets in or the
existence of Account TAS.
5. Provided Contract Owners annually approve this Agreement at a
meeting of Contract Owners held for that purpose, Account TAS
will reimburse the Company for charges and expenses paid by the
Company to registered investment advisers which provide market
timing investment advisory services relating to the Contracts
pursuant to written agreements between the Contract Owners and
such market timing investment advisers, which agreements are
acceptable to the Company. The failure of Contract Owners to
approve this Distribution and Management Agreement shall have no
effect on the validity of the provisions of this Agreement other
than this paragraph 5.
6. The services of the Company and Tower Square to Account TAS
hereunder are not to be deemed exclusive and the Company and
Tower Square will be free to render similar services to others
so long as its services hereunder are not impaired or interfered
with thereby.
7. The Company agrees to guarantee that the annuity payments will
not be affected by mortality experience (under Contracts the
reserves for which are invested in Account TAS) and assumes the
risks (a) that the actuarial estimate of mortality rates among
annuitants may prove erroneous and that reserves set up on the
basis of such estimates will not be sufficient to meet the
Company's variable annuity payment obligations, and (b) that the
charges for services and expenses of the Company set forth in
the Contracts, including the payment of any guaranteed minimum
death benefit prior to the Maturity Date specified in the
Contract, may not prove sufficient to cover its actual expenses.
For providing these mortality and expense risk guarantees, the
Company will receive from Account TAS an amount per valuation
period of Account TAS, as provided from time to time.
8. This Agreement shall continue in effect for a period of more
than two years from the date of its execution, only so long as
such continuance after said date is specifically approved at
least annually by a vote of a majority of the Board of Managers,
who are parties to such Agreement or interested persons of any
such party, cast in person at a meeting called for the purpose
of voting on such approval, or by a vote of a majority of the
outstanding voting securities of Account TAS; provided, however,
that this Agreement will terminate automatically in the event of
its assignment by either party.
9. Notwithstanding termination of this Agreement, the Company will
continue to provide administrative services and mortality and
expense risk guarantees provided for herein with respect to the
Contracts in effect on the date of termination, and the Company
shall continue to receive the compensation provided under this
Agreement.
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<PAGE> 16
10. This Agreement is subject to the provisions of the Investment
Company Act of 1940, as amended, and the rules of the Securities
and Exchange Commission thereunder.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be signed by their respective officials thereunto duly authorized and, in the
case of the Company and Tower Square, the seals to be affixed as of the day
and year first above written.
[SIGNATURE LINES OMITTED]
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<PAGE> 17
THE TRAVELERS TIMED AGGRESSIVE STOCK ACCOUNT
FOR VARIABLE ANNUITIES
PROXY STATEMENT
VG-158 1996
14
<PAGE> 18
FORM OF
THE TRAVELERS TIMED AGGRESSIVE STOCK ACCOUNT FOR VARIABLE ANNUITIES
Proxy for the Annual Meeting of Contract Owners to be held on April 19, 1996
The undersigned, revoking all proxies heretofore given, hereby appoints Heath
B. McLendon, Robert E. McGill, III, or either one of them, as Proxies, with
full power of substitution, to vote on behalf of the undersigned all units of
The Travelers Timed Aggressive Stock Account for Variable Annuities which the
undersigned is entitled to vote at the Annual Meeting of Contract Owners to be
held at 8:30 a.m. on Friday, April 19, 1996 at One Tower Square, Hartford,
Connecticut, and at any adjournment thereof, in the manner directed below with
respect to the matters described in the Proxy Statement for the Annual Meeting,
receipt of which is hereby acknowledged, and in their discretion, upon such
other matters as may properly come before the Annual Meeting or any adjournment
thereof.
<TABLE>
<CAPTION>
FOR FOR, except WITHHOLD
PLEASE VOTE BY FILLING IN THE APPROPRIATE BOX BELOW, AS SHOWN, USING BLUE OR BLACK INK all vote withheld AUTHORITY
OR DARK PENCIL. DO NOT USE RED INK. nominees for nominee for all
listed below nominees
<S> <C> <C> <C>
1. Election of the Board of Managers - Nominees:
Heath B. McLendon, Knight Edwards, Robert E. McGill, III, Lewis Mandell, ___ ___ ___
and Frances M. Hawk.
----------------------------------------------------------------
FOR AGAINST ABSTAIN
2. Ratification of the selection of Coopers & Lybrand L.L.P. as independent accountants
for the fiscal year ending December 31, 1996. ___ ___ ___
3. Approval of a proposal to amend the Investment Advisory Agreement between
Account TAS and The Travelers Investment Management Company. ___ ___ ___
4. Approval of the continuation of the Distribution and Management Agreement among The
Travelers Timed Aggressive Stock Account for Variable Annuities, The Travelers Insurance
Company and Tower Square Securities, Inc. ___ ___ ___
</TABLE>
In their discretion, the Proxies are authorized to vote on any and all other
business as may properly come before the meeting.
PLEASE DO NOT FORGET TO SIGN THE REVERSE SIDE OF CARD
- -------------------------------------------------------------------------
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF MANAGERS. THE UNITS
REPRESENTED HEREBY WILL BE VOTED BY THE PROXIES IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED CONTRACT OWNER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR PROPOSALS 1, 2, 3 AND 4.
PLEASE MARK, SIGN, DATE AND RETURN THIS
PROXY CARD PROMPTLY USING THE ENCLOSED
PRE-ADDRESSED, POSTAGE-PAID ENVELOPE.
PLEASE SIGN EXACTLY AS NAME APPEARS BELOW.
DATE: ________________________________, 1996.
If signing in a representative capacity (as attorney, executor
or administrator, trustee, guardian or custodian, corporate
officer or general partner), please indicate such capacity
following signature. Proxies for custodian accounts must be
signed by the named custodian, not by the minor.
-------------------------------------------------------------
Signature(s) if held jointly (Titles), if required)
