UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
POST-EFFECTIVE AMENDMENT NO. 2
TO REGISTRATION STATEMENT NO. 333-149953
ON
FORM S-1
UNDER
THE SECURITIES ACT OF 1933
RiverSource Life Insurance Company
(Exact name of registrant as specified in its charter)
Minnesota
(State or other jurisdiction of incorporation or organization)
41-0823832
(I.R.S. Employer Identification No.)
70100 Ameriprise Financial Center, Minneapolis, MN 55474
(800) 862-7919
(Address,including zip code, and telephone number, including area code,
of registrant's principal executive offices)
Rodney J. Vessels
RiverSource Life Insurance Company
50605 Ameriprise Financial Center, Minneapolis, Minnesota 55474
(612) 671-2237
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Approximate date of commencement of proposed sale to the public: April 30, 2010
or as soon as practicable after the effective date of the Registration
Statement.
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933 check the following box. [X]
Pursuant to Rule 429 under the Securities Exchange Act of 1934 the prospectuses
to be filed herein also relate to and will constitute upon effectiveness a
Post-Effective Amendment to Securities Act Registration Statement Nos. 033-28976
and 333-114888.
The registrant hereby amends this registration statement on such date or dates
as may be necessary to delay its effective date until the registrant shall file
a further amendment which specifically states that this registration statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the registration statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
Calculation of Registration Fee
TITLE OF EACH CLASS PROPOSED MAXIMUM PROPOSED MAXIMUM
OF SECURITES TO BE AMOUNT TO BE OFFERING PRICE PER AGGREGATE OFFERING AMOUNT OF
REGISTERED REGISTERED UNIT PRICE REGISTRATION FEE*
--------------------------- ------------ ------------------ ------------------ -----------------
Interests in market $0 $0**
value adjusted annuity
contracts and accounts
of RiverSource Retirement
Advisor Advantage Plus
Variable Annuity,
RiverSource Retirement
Advisor Select Plus
Variable Annuity,
RiverSource Retirement
Advisor 4 Advantage
Variable Annuity,
RiverSource Retirement
Advisor 4 Select Variable
Annuity, RiverSource
Retirement Advisor 4 Access
Variable Annuity, and
RiverSource Guaranteed
Term Annuity.
* The proposed aggregate offering price is estimated solely for determining
the registration fee. The amount being registered and the proposed maximum
offering price per unit are not applicable since these securities are not
issued in predetermined amounts or units.
** The difference between the $300,000,000 of securities registered on
Securities Act Registration Statement No. 033-28976 (for which a
registration fee of $60,000 was paid) and the $250,000,000 of securities
registered on Securities Act Registration Statement No. 333-114888 (for
which a registration fee of $31,675 was paid), and the dollar amount of
securities sold thereunder, is carried forward on this Registration
Statement pursuant to Rule 429 of the Securities Act.
PART I.
INFORMATION REQUIRED IN PROSPECTUS
The prospectuses for RiverSource Retirement Advisor Advantage Plus Variable
Annuity, RiverSource Retirement Advisor Select Plus Variable Annuity,
RiverSource Retirement Advisor 4 Advantage(SM) Variable Annuity/RiverSource
Retirement Advisor 4 Select(SM) Variable Annuity/RiverSource Retirement Advisor
4 Access Variable Annuity are incorporated by reference from Part A of
Post-Effective Amendment No. 57 to Registration Statement No. 333-79311, filed
on or about April 23, 2010.
PROSPECTUS
APRIL 30, 2010
RIVERSOURCE(R)
GUARANTEED TERM ANNUITY
RiverSource Life Insurance Company (RiverSource Life) issues this annuity and
offers it in two ways:
- A Group Market Value Annuity Contract, and
- Individual Market Value Annuity Contracts.
NEW GROUP MARKET VALUE ANNUITY CONTRACTS AND INDIVIDUAL MARKET VALUE ANNUITY
CONTRACTS ARE NOT CURRENTLY BEING OFFERED. EXISTING CONTRACTS ARE AVAILABLE FOR
RENEWAL.
GROUP AND INDIVIDUAL MARKET VALUE ANNUITY CONTRACTS
ISSUED BY: RIVERSOURCE LIFE INSURANCE COMPANY
70100 Ameriprise Financial Center
Minneapolis, MN 55474
Telephone: (800) 862-7919
ameriprise.com/variableannuities
RIVERSOURCE ACCOUNT MGA
If you choose not to hold these securities until the end of a guarantee period,
they may be subject to a substantial surrender charge or market value
adjustment. As a result, you could get less than your purchase payment back.
Interest rates for renewal guarantee periods may be higher or lower than the
previous guaranteed interest rate. The minimum guaranteed renewal interest rate
is 3%. RiverSource Life guarantees this rate.
THE SECURITIES AND EXCHANGE COMMISSION (SEC) HAS NOT APPROVED OR DISAPPROVED
THESE SECURITIES OR PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
AN INVESTMENT IN THIS ANNUITY IS NOT A DEPOSIT OF A BANK OR FINANCIAL
INSTITUTION AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION (FDIC) OR ANY OTHER GOVERNMENT AGENCY. AN INVESTMENT IN THIS ANNUITY
INVOLVES INVESTMENT RISK INCLUDING THE POSSIBLE LOSS OF PRINCIPAL.
Before you invest, be sure to ask your sales representative about the annuity's
features, benefits, risks and fees, and whether the annuity is appropriate for
you, based upon your financial situation and objectives.
The contract may not be available in all jurisdictions. This prospectus
constitutes an offering or solicitation only in those jurisdictions where such
offering or solicitation may lawfully be made. State variations are covered in a
special contract form used in that state. This prospectus provides a general
description of the contract. Your actual contract and any riders or endorsements
are the controlling documents.
RiverSource Life has not authorized any person to give any information or to
make any representations regarding the contract other than those contained in
this prospectus. Do not rely on any such information or representations.
RiverSource Life offers several different annuities which your sales
representative may or may not be authorized to offer to you. Each annuity has
different features and benefits that may be appropriate for you based on your
financial situation and needs, your age and how you intend to use the annuity.
The different features and benefits may include the investment and fund manager
options, variations in interest rate amount and guarantees, credits, surrender
charge schedules and access to annuity account values. The fees and charges may
also be different between each annuity.
RIVERSOURCE GUARANTEED TERM ANNUITY -- PROSPECTUS 1
TABLE OF CONTENTS
<Table>
THE GUARANTEED TERM ANNUITY IN BRIEF................... 3
KEY TERMS.............................................. 5
DESCRIPTION OF CONTRACTS............................... 6
General.............................................. 6
Application and Purchase Payment..................... 6
Right to Cancel...................................... 6
Guarantee Periods.................................... 6
Surrenders........................................... 8
Surrender Charge..................................... 9
MARKET VALUE ADJUSTMENT................................ 10
PREMIUM TAXES.......................................... 12
DEATH BENEFIT PRIOR TO SETTLEMENT...................... 12
THE ANNUITY PAYMENT PERIOD............................. 12
AMENDMENT, DISTRIBUTION AND ASSIGNMENT OF CONTRACTS.... 14
TAXES.................................................. 15
THE COMPANY............................................ 18
ADDITIONAL INFORMATION................................. 19
APPENDIX A -- PARTIAL SURRENDER ILLUSTRATION........... 21
APPENDIX B -- MARKET VALUE ADJUSTMENT ILLUSTRATION..... 23
</Table>
2 RIVERSOURCE GUARANTEED TERM ANNUITY -- PROSPECTUS
THE GUARANTEED TERM ANNUITY IN BRIEF
This summary is incomplete. Do not rely on it as a description of your contract.
For more complete information, you must read the entire prospectus. You can find
more information about a topic in the summary by turning to the discussion
beginning at the page listed after that topic in the summary.
CONTRACTS: We no longer offer new contracts. However, you have the option to
renew existing contracts.
Most annuities have a tax-deferred feature. So do many retirement plans under
the Code. As a result, when you use a qualified annuity to fund a retirement
plan that is tax-deferred, your contract will not provide any necessary or
additional tax deferral for that retirement plan. A qualified annuity has
features other than tax deferral that may help you reach your retirement goals.
In addition, the Code subjects retirement plans to required withdrawals
triggered at a certain age. These mandatory withdrawals are called required
minimum distributions (RMDs). RMDs may reduce the value of certain death
benefits (see "Taxes -- Qualified Annuities -- Required minimum distributions").
You should consult your tax advisor for an explanation of the potential tax
implications to you.
These market value annuity contracts have a guaranteed interest rate that we
credit to the purchase payment when it is held to the end of the guarantee
period (the renewal date). Surrenders before the renewal date are subject to a
market value adjustment and, if it applies, a surrender charge. Therefore you
should consider your liquidity needs before you select a guarantee period.
GUARANTEE PERIODS: When you make a payment under an application, you select a
guarantee period from among those that we offer when we receive your application
and payment. During this guarantee period, the purchase payment earns interest
at the interest rate that we have guaranteed for your contract. We credit
interest daily. Credited interest earns interest at the applicable guaranteed
interest rate we establish. (See "Description of Contracts -- Guarantee
Periods")
RENEWAL GUARANTEE PERIODS: At the end of each guarantee period, a renewal
guarantee period of one year will begin, unless you choose a different period.
You must choose the length of a renewal guarantee period during the 30 days
before the end of the previous guarantee period. Beginning on the first day of
each renewal guarantee period, the renewal value will earn interest at the
renewal interest rate that we have guaranteed for your contract and the interest
credited will earn interest at that interest rate. (See "Renewal Guarantee
Periods")
SURRENDERS: With some restrictions, we permit partial or total surrenders. We
may delay payment of any surrender for up to six months from the date we receive
notice of surrender or the period permitted by state law, if less. A delay of
payment will not be for more than seven days except under extraordinary
circumstances. If we choose to exercise this right, then during this delay, we
will pay annual interest of at least 3% of any amounts delayed for more than
thirty days. (See "Surrenders")
SURRENDER CHARGE: If you surrender before the eighth contract anniversary, a
surrender charge beginning at a maximum of 8% of the market adjusted value
surrendered will be subtracted from your account. No surrender charge applies if
you surrender on the last day of a guarantee period. We will waive the surrender
charge in certain instances. A surrender charge also applies to payments under
certain annuity payment plans (see "Description of Contracts -- Surrender
Charge" and "The Annuity Payment Period -- Annuity Payment Plans")
MARKET VALUE ADJUSTMENT: The market value adjustment is the increase or decrease
in the value of any early surrender you make from your contract. A market value
adjustment applies when the surrender occurs before the renewal date. No market
value adjustment applies to any surrender at the end of a guarantee period. The
amount of the actual adjustment is determined by a formula that is based on the
difference between the guaranteed interest rate on your annuity and a current
interest rate determined by RiverSource Life. That current interest rate will be
the rate that RiverSource Life pays on a new Guaranteed Term Annuity that has a
guaranteed period equal to the time remaining on the term of your annuity. The
formula also includes a 0.25% charge that will reduce the value of your
surrender regardless of the current interest rate then in effect. The amount you
receive on surrender could be less than your original purchase payment if
interest rates increase. If interest rates decrease, the amount you receive on
surrender may be more than your original purchase payment and accrued interest.
The market adjusted value also affects settlements under an annuity payment
plan. (See "Market Value Adjustment")
PREMIUM TAXES: We may deduct premium taxes that may be imposed on us by state or
local governments from the accumulation value of your contract. State premium
taxes range from 0 to 3.5% of your gross purchase payments. (See "Premium
Taxes")
DEATH BENEFIT PRIOR TO SETTLEMENT: The contract provides for a guaranteed death
benefit. If the annuitant or owner dies before the settlement date, we will pay
to the owner or beneficiary the death benefit in place of any other payment
under the contract. The amount of the death benefit will equal the accumulation
value. (See "Death Benefit Prior to Settlement")
THE ANNUITY PAYMENT PERIOD: Beginning at a specified time in the future, we will
pay the owner a lump sum payment or start to pay a series of payments. You may
choose a series of payments under some annuity plans. (See "The Annuity Payment
Period")
RIVERSOURCE GUARANTEED TERM ANNUITY -- PROSPECTUS 3
LIMITATIONS ON USE OF CONTRACTS: If mandated by applicable law, including but
not limited to, federal anti-money laundering laws, we may be required to reject
a purchase payment. We may also be required to block an owner's access to
contract values to satisfy other statutory obligations. Under these
circumstances we may refuse to process transactions under the contract until
instructions are received from the appropriate governmental authority or a court
of competent jurisdiction.
4 RIVERSOURCE GUARANTEED TERM ANNUITY -- PROSPECTUS
KEY TERMS
These terms can help you understand details about your contract:
ACCUMULATION VALUE: The value of the purchase payment plus interest credited,
adjusted for any surrenders and surrender charges.
ANNUITANT: The person on whose life monthly annuity payments depend.
ANNUITY: A contract purchased from an insurance company that offers tax-deferred
growth of the purchase payment until earnings are withdrawn.
CASH SURRENDER VALUE: The market adjusted value less any applicable surrender
charge. On the last day of a guarantee period, the cash surrender value is the
accumulation value.
CODE: The Internal Revenue Code of 1986, as amended.
CONTRACT: A deferred annuity contract, or a certificate showing your interest
under a group annuity contract, that permits you to accumulate money for
retirement or a similar long-term goal by making a purchase payment. A contract
provides for a lifetime or other forms of payments beginning at a specified time
in the future.
CONTRACT ANNIVERSARY: The same day and month as the contract date each year that
the contract remains in force.
CONTRACT DATE: The effective date of the contract as designated in the contract.
CURRENT INTEREST RATE: The applicable interest rate contained in a schedule of
rates established by us at our discretion from time to time for various
guarantee periods.
INITIAL GUARANTEE PERIOD: The period during which the initial guarantee rate
will be credited.
INITIAL GUARANTEE RATE: The rate of interest credited to the purchase payment
during the initial guarantee period.
MARKET ADJUSTED VALUE: The accumulation value increased or decreased by the
market adjusted value formula, on any date before the end of the guarantee
period.
MARKET VALUE ADJUSTMENT: The market adjusted value minus the accumulation value.
OWNER: The person or entity to whom the contract is issued.
PURCHASE PAYMENT: Payment made to RiverSource Life for a contract.
QUALIFIED ANNUITY: A contract that you purchase to fund one of the following
tax-deferred retirement plans that is subject to applicable federal law and any
rules of the plan itself:
- Individual Retirement Annuities (IRAs) under Section 408(b) of the Code
- Roth IRAs under Section 408A of the Code
- Simplified Employee Pension IRA (SEP) plans under Section 408(k) of the Code
- Plans under Section 401(k) of the Code
- Custodial and investment only plans under Section 401(a) of the Code
- Tax-Sheltered Annuities (TSAs) under Section 403(b) of the Code
A qualified annuity will not provide any necessary or additional tax deferral if
it is used to fund a retirement plan that is already tax deferred.
All other contracts are considered NONQUALIFIED ANNUITIES.
RENEWAL DATE: The first day of a renewal guarantee period. It will always be on
a contract anniversary.
RENEWAL GUARANTEE PERIOD: A renewal guarantee period will begin at the end of
each guarantee period.
RENEWAL GUARANTEE RATE: The rate of interest credited to the renewal value
during the renewal guarantee period as set at our discretion.
RENEWAL VALUE: The accumulation value at the end of the current guarantee
period.
RIVERSOURCE LIFE: In this prospectus, "we," "us" and "RiverSource Life" refer to
RiverSource Life Insurance Company and "you" and "yours" refer to an owner who
has been issued a contract.
SETTLEMENT: The application of contract value to provide annuity payments. If
the settlement date is not the last day of a guarantee period, we apply the
market adjusted value of the contract. On the last day of a guarantee period, we
apply the accumulation value of the contract.
SETTLEMENT DATE: The date on which annuity payments are to begin.
WRITTEN REQUEST: A request in writing signed by you and delivered to us at our
home office.
RIVERSOURCE GUARANTEED TERM ANNUITY -- PROSPECTUS 5
DESCRIPTION OF CONTRACTS
GENERAL
This prospectus describes interests in qualified and nonqualified group and
individual market value annuity contracts offered by RiverSource Life to the
general public.
As described in this prospectus, the contracts have an interest rate guaranteed
by RiverSource Life that we credit to a purchase payment in the contract when
the purchase payment stays in the contract to its renewal date. We credit
(compound) interest daily to achieve a stated annual effective rate, based on a
365-day year. We do not pay interest on leap days (Feb. 29). Surrenders prior to
the renewal date are subject to a market value adjustment, a surrender charge
(if applicable), income taxes, and a 10% IRS tax penalty if withdrawn prior to
age 59 1/2.
APPLICATION AND PURCHASE PAYMENT
We no longer offer new contracts. However, you have the option to renew existing
contracts. For individuals age 90 and younger, the maximum purchase payment is
$1,000,000 without prior approval. This limit applies in total to all
RiverSource Life annuities you own. Once we apply a purchase payment to a
contract, we do not permit any additional purchase payment under the contract.
We will return an improperly completed application, along with the corresponding
purchase payment, five business days after we receive it.
A payment is credited to a contract on the date we receive a properly completed
application at our home office along with the purchase payment. Interest is
earned the next day. RiverSource Life then issues a contract and confirms the
purchase payment in writing.
RIGHT TO CANCEL
State or federal law may give you the right to cancel the contract within a
specific period of time after receipt of the contract and receive a refund of
the entire purchase payment. For revocation to be effective, mailing or delivery
of notice of cancellation must be made in writing to our home office at the
following address: RiverSource Life Insurance Company, 70100 Ameriprise
Financial Center, Minneapolis, MN 55474.
GUARANTEE PERIODS
You select the duration of the guarantee period from among those durations we
offer when we receive your application and payment. The duration selected will
determine the guaranteed interest rate and the purchase payment (less surrenders
made and less applicable premium taxes, if any) will earn interest at this
guaranteed interest rate during the entire guarantee period. Interest is
credited to your annuity daily. All interest rates we quote are effective annual
interest rates. This refers to the rate that results after interest has
compounded daily for a full year. In other words, the interest you earn each day
earns interest itself the next day, assuming you do not withdraw it. (At the end
of a year, assuming you have made no withdrawals, your interest earnings will
equal your guaranteed rate multiplied by your contract value at the beginning of
the year.)
The example below shows how we will credit interest during the guarantee period.
For the purpose of this example, we have made the assumptions as indicated.
6 RIVERSOURCE GUARANTEED TERM ANNUITY -- PROSPECTUS
EXAMPLE OF GUARANTEED RATE OF ACCUMULATION
<Table>
Beginning account value: $50,000
Guaranteed period: 10 years
Guaranteed rate: 4% annual effective rate
</Table>
<Table>
<Caption>
INTEREST CREDITED TO THE CUMULATIVE INTEREST
YEAR ACCOUNT DURING YEAR CREDITED TO THE ACCOUNT ACCUMULATION VALUE
1 $2,000.00 $ 2,000.00 $52,000.00
2 2,080.00 4,080.00 54,080.00
3 2,163.20 6,243.20 56,243.20
4 2,249.73 8,492.93 58,492.93
5 2,339.72 10,832.65 60,832.65
6 2,433.31 13,265.95 63,265.95
7 2,530.64 15,796.59 65,796.59
8 2,631.86 18,428.45 68,428.45
9 2,737.14 21,165.59 71,165.59
10 2,846.62 24,012.21 74,012.21
</Table>
Guaranteed accumulation value at the end of 10 years is:
$50,000 + $24,012.21 = $74,012.21
NOTE: THIS EXAMPLE ASSUMES NO SURRENDERS OF ANY AMOUNT DURING THE ENTIRE TEN-
YEAR PERIOD. A MARKET VALUE ADJUSTMENT APPLIES AND A SURRENDER CHARGE MAY APPLY
TO ANY INTERIM SURRENDER (SEE "SURRENDERS"). THE HYPOTHETICAL INTEREST RATES ARE
ONLY ILLUSTRATIONS. THEY DO NOT PREDICT FUTURE INTEREST RATES TO BE DECLARED
UNDER THE CONTRACT. ACTUAL INTEREST RATES DECLARED FOR ANY GIVEN TIME MAY BE
MORE OR LESS THAN THOSE SHOWN.
RENEWAL GUARANTEE PERIODS: At the end of any guarantee period, a renewal
guarantee period will begin. We will notify you in writing about the renewal
guarantee periods available before the renewal date. This written notification
will not specify the interest rate for the renewal value. You may elect in
writing, during the 30-day period before the end of the guarantee period, a
renewal guarantee period of a different duration from among those we offer at
that time. If you do not make an election, we will automatically apply the
renewal value to a guarantee period of one year. In no event may renewal
guarantee periods extend beyond the settlement date then in effect for the
contract. For example, if the annuitant is age 82 at the end of a guarantee
period and the settlement date for the annuitant is age 85, a three-year
guarantee period is the maximum guarantee period that you may choose under the
contract. The renewal value will then earn interest at a guaranteed interest
rate that we have declared for this duration. We may declare new schedules of
guaranteed interest rates as often as daily.
At the beginning of any renewal guarantee period, the renewal value will be the
accumulation value at the end of the guarantee period just ending. We guarantee
the renewal value with our general assets. This amount will earn interest for
the renewal guarantee period at the then applicable guaranteed interest rate for
the period selected. This rate may be higher or lower than the previous
guaranteed interest rate.
At your written request, we will notify you of the renewal guarantee rates for
the periods then available. You also may call us to ask about renewal guarantee
rates.
ESTABLISHMENT OF GUARANTEED INTEREST RATES: We will know the guaranteed interest
rate for a chosen guarantee period at the time we receive a purchase payment or
you renew an accumulation value. We will send a confirmation that will show the
amount and the applicable guaranteed interest rate. The minimum guaranteed
interest rate for renewal values is 3% per year. The rate on renewal values will
be equal to or greater than the rate credited on new comparable purchase
payments at that time.
The interest rates that RiverSource Life will declare as guaranteed rates in the
future are determined by us at our discretion. We will determine the rates based
on various factors including, but not limited to the interest rate environment,
returns earned on investments backing these annuities (see "Investments by
RiverSource Life"), product design, competition, and RiverSource Life's revenues
and expenses. WE CANNOT PREDICT NOR CAN WE GUARANTEE FUTURE GUARANTEED INTEREST
RATES ABOVE THE 3% RATE.
RIVERSOURCE GUARANTEED TERM ANNUITY -- PROSPECTUS 7
SURRENDERS
GENERAL: Subject to certain tax law and retirement plan restrictions noted
below, you may make total and partial surrenders under a contract at any time.
For all surrenders, we will reduce the accumulation value by the amount
surrendered on the surrender date and that amount will be payable to the owner.
We will also reduce the accumulation value by any applicable surrender charge.
We will either reduce or increase the accumulation value by any market value
adjustment applicable to the surrender. RiverSource Life will, on request,
inform you of the amount payable in a total or partial surrender.
Any total or partial surrender may be subject to tax and tax penalties.
Surrenders from certain tax qualified annuities also may be subject to 20%
income tax withholding. (See "Taxes".)
TAX-SHELTERED ANNUITIES: The contract is not intended for use in connection with
an employer sponsored 403(b) plan that is subject to the Employee Retirement
Income Security Act of 1974, as amended (ERISA). In the event that the employer
either by affirmative election or inadvertent action causes contributions under
a plan that is subject to ERISA to be made to this contract, we will not be
responsible for any obligations and requirements under ERISA and the regulations
thereunder. You should consult with your employer to determine whether your
403(b) plan is subject to ERISA.
The employer must comply with certain nondiscrimination requirements for certain
types of contributions under a TSA contract to be excluded from taxable income.
You should consult your employer to determine whether the nondiscrimination
rules apply to you.
The Code imposes certain restrictions on your right to receive early
distributions from a TSA:
- Distributions attributable to salary reduction contributions (plus earnings)
made after Dec. 31, 1988, or to transfers or rollovers from other contracts,
may be made from the TSA only if:
- you are at least age 59 1/2;
- you are disabled as defined in the Code;
- you severed employment with the employer who purchased the contract;
- the distribution is because of your death;
- the distribution is due to plan termination; or
- you are a military reservist.
- If you encounter a financial hardship (as provided by the Code), you may be
eligible to receive a distribution of all contract values attributable to
salary reduction contributions made after Dec. 31, 1988, but not the earnings
on them.
- Even though a distribution may be permitted under the above rules, it may be
subject to IRS taxes and penalties (see "Taxes").
- The above restrictions on distributions do not affect the availability of the
amount credited to the contract as of Dec. 31, 1988. The restrictions also do
not apply to transfers or exchanges of contract value within the contract, or
to another registered variable annuity contract or investment vehicle
available through the employer.
PARTIAL SURRENDERS: Unless we agree otherwise, the minimum amount you may
surrender is $250. You cannot make a partial surrender if it would reduce the
accumulation value of your annuity to less than $2,000.
You may request the net check amount you wish to receive. We will determine how
much accumulation value needs to be surrendered to yield the net check amount
after any applicable market value adjustments and surrender charge deductions.
You may make a partial surrender request not exceeding $100,000 by telephone. We
have the authority to honor any telephone partial surrender request believed to
be authentic and will use reasonable procedures to confirm that they are. This
includes asking identifying questions and tape recording calls. As long as
reasonable procedures are followed, neither RiverSource Life nor its affiliates
will be liable for any loss resulting from fraudulent requests. At times when
the volume of telephone requests is unusually high, we will take special
measures to ensure that your call is answered as promptly as possible. We will
not allow a telephone surrender request within 30 days of a phoned-in address
change.
TOTAL SURRENDERS: We will compute the value of your contract at the next close
of business after we receive your request for a complete surrender. We may ask
you to return the contract.
PAYMENT ON SURRENDER: We may defer payment of any partial or total surrender for
a period not exceeding six months from the date we receive your notice of
surrender or the period permitted by state insurance law, if less. Only under
extraordinary circumstances will we defer a surrender payment more than seven
days, and if we defer payment for more than 30 days, we will pay annual interest
of at least 3% on the amount deferred. While all circumstances under which we
could defer payment upon surrender may not be foreseeable at this time, such
circumstances could include, for example, our inability to liquidate assets due
to a general financial crisis. If we intend to withhold payment more than 30
days, we will notify you in writing.
8 RIVERSOURCE GUARANTEED TERM ANNUITY -- PROSPECTUS
NOTE: We will charge you a fee if you request express mail delivery or that
payment be wired to your bank. For instructions, please contact your sales
representative.
Any partial surrenders you take under your contract will reduce your
accumulation value. As a result, the value of your death benefit will also be
reduced. In addition, surrenders you are required to take to satisfy RMDs under
the Code may reduce the value of your death benefit (see "Taxes -- Qualified
Annuities -- Required minimum distributions").
SURRENDER CHARGE
We may assess a surrender charge on any total or partial surrender taken prior
to the eighth contract anniversary unless the surrender occurs on the last day
of a guarantee period. We will base the amount of the surrender charge on the
length of the guarantee period. The table below shows the maximum amount of the
surrender charge.
SURRENDER CHARGE PERCENTAGE:
<Table>
<Caption>
GUARANTEE CONTRACT YEARS AS MEASURED FROM THE BEGINNING OF A GUARANTEE PERIOD
PERIOD 1 2 3 4 5 6
1 year 1%
2 years 2 1%
3 years 3 2 1%
4 years 4 3 2 1%
5 years 5 4 3 2 1%
6 years 6 5 4 3 2 1%
7 years 7 6 5 4 3 2
8 years 8 7 6 5 4 3
9 years 8 7 6 5 4 3
10 years 8 7 6 5 4 3
<Caption>
CONTRACT YEARS AS MEASURED FROM THE
GUARANTEE BEGINNING OF A GUARANTEE PERIOD
PERIOD 7 8
1 year
2 years
3 years
4 years
5 years
6 years
7 years 1%
8 years 2 1%
9 years 2 1
10 years 2 1
</Table>
To determine the surrender charge on the initial guarantee period, in the
"Guarantee period" column find the number of years for the guarantee period you
have chosen. The row that period is in reflects the schedule of surrender
charges during that period. For example, a 5-year guarantee period has a 5%
surrender charge in the first contract year, a 4% charge in the second, a 3%
charge in the third, a 2% charge in the fourth, and a 1% charge in the fifth.
For renewal guarantee periods, we will base the surrender charge on the lesser
of:
- the length of the new guarantee period; or
- the number of years remaining until the eighth contract anniversary.
In our example, if a contract owner chose an initial guarantee period of five
years and later a renewal guarantee period of four years, the surrender charge
schedule for that renewal guarantee period would be three years long. That is
because there are only three years remaining until the eighth contract
anniversary (8 - 5 = 3), and three years is less than the four-year length of
the new guarantee period. The surrender charge percentages would be:
<Table>
<Caption>
CONTRACT YEAR SURRENDER CHARGE
1 5%
2 4
3 3
4 2
5 1*
6 3
7 2
8 1
9+ 0
</Table>
* 0% on last day of fifth contract year.
There will never be any surrender charges after the eighth contract anniversary.
Also, after the first contract anniversary, surrender charges will not apply to
surrenders of amounts totalling up to 10% of the accumulation value as of the
last contract anniversary.
RIVERSOURCE GUARANTEED TERM ANNUITY -- PROSPECTUS 9
SURRENDER CHARGE CALCULATION: If there is a surrender charge, we calculate it
as:
(A - B) X P
<Table>
where: A = market adjusted value surrendered
B = the lesser of A or 10% of accumulation value on last contract anniversary
not already taken as a partial surrender this contract year. (Before the
first contract anniversary, B does not apply.)
P = applicable surrender charge percentage
</Table>
For an illustration of a partial surrender and applicable surrender charges, see
Appendix A.
SURRENDER CHARGE UNDER ANNUITY PAYMENT PLAN E: Under this payment plan, you can
choose to take a full surrender at any time after one year of payments. The
amount you can surrender is the present value of any remaining payments. The
discount rate we use in calculating the present value is based on the annual
effective interest rate for then-current payment amounts for immediate annuities
with the same purchase amount and remaining term length plus 1.5%. The surrender
charge equals the net present value of the remaining payments (determined after
we apply the discount rate) multiplied by a surrender charge percentage. This
percentage is 5% in payment year two decreasing by 1% per year until it is 0% in
payment year seven and thereafter. This feature is not available in all states.
Please contact your sales representative for availability.
WAIVER OF SURRENDER CHARGE: We will assess no surrender charge:
- on the last day of a guarantee period;
- after the eighth contract anniversary;
- after the first contract anniversary for surrenders of amounts totalling up to
10% of the contract accumulation value as of the last contract anniversary;
- to the extent that they exceed the 10% of the contract value on the prior
contract anniversary (available after the first anniversary), required minimum
distributions from a qualified annuity. The amount on which surrender charges
are waived can be no greater than the RMD amount calculated under your
specific contract currently in force;
- upon the death of the annuitant or owner; or
- upon the application of the market adjusted value to provide annuity payments
under an annuity payment plan, unless an Annuity Payment Plan E is later
surrendered. (If the application occurs on a renewal date, there will be no
surrender charge or market value adjustment, and the full accumulation value
will be applied under an annuity payment plan.)
In some cases, such as when an employer makes this annuity available to
employees, we may expect to incur lower sales and administrative expenses or
perform fewer services due to the size of the group, the average contribution
and the use of group enrollment procedures. Then we may be able to reduce or
eliminate surrender charges. However, we expect this to occur infrequently.
MARKET VALUE ADJUSTMENT
We guarantee the accumulation value, including the interest credited, if the
contract is held until the end of the guarantee period. However, we will apply a
market value adjustment if a surrender occurs prior to the end of the guarantee
period. The market adjusted value also affects settlements under an annuity
payment plan occurring at any time other than the last day of a guarantee
period.
The market adjusted value is your accumulation value (purchase payment plus
interest credited minus surrenders and surrender charges) adjusted by a formula.
The market adjusted value reflects the relationship between the guaranteed
interest rate on your contract and the interest rate we are crediting on new or
renewal Guaranteed Term Annuity contracts with guarantee periods that are the
same as the time remaining in your guarantee period.
The market adjusted value is sensitive to changes in current interest rates. The
difference between your accumulation value and market adjusted value on any day
will depend on our current schedule of guaranteed interest rates on that day,
the time remaining in your guarantee period and your guaranteed interest rate.
Upon surrender your market adjusted value may be greater than your contract's
accumulation value, equal to it or less than it depending on how the guaranteed
interest rate on your contract compares to the interest rate of a new Guaranteed
Term Annuity for the same number of years as the guarantee period remaining on
your contract.
Before we look at the market adjusted value formula, it may help to look in a
general way at how comparing your contract's guaranteed rate and the rate for a
new contract affects your market adjusted value.
10 RIVERSOURCE GUARANTEED TERM ANNUITY -- PROSPECTUS
RELATIONSHIP BETWEEN YOUR CONTRACT'S GUARANTEED RATE AND NEW CONTRACT FOR THE
SAME NUMBER OF YEARS AS THE GUARANTEED PERIOD REMAINING ON YOUR CONTRACT:
<Table>
<Caption>
IF YOUR ANNUITY RATE IS: YOUR MARKET ADJUSTED VALUE WILL BE:
less than the new annuity rate +.25% less than your accumulation value
equal to the new annuity rate +.25% equal to your accumulation value
greater than the new annuity rate +.25% greater than your accumulation value
</Table>
GENERAL EXAMPLES
ASSUME:
- You purchase a contract and choose a guarantee period of 10 years.
- We guarantee an interest rate of 4.5% annually for your 10-year guarantee
period.
- After three years you decide to surrender your contract. In other words, you
decide to surrender your contract when you have seven years left in your
guarantee period.
Remember that your market adjusted value depends partly on the interest rate of
a new Guaranteed Term Annuity for the same number of years as the guarantee
period remaining on your contract. In this case, that is seven years.
EXAMPLE 1: Remember that your contract is earning 4.5%. Assume that new
contracts that we offer with a seven-year guarantee period are earning 5.0%. We
add 0.25% to the 5.0% rate to get 5.25%. Your contract's 4.5% rate is less than
the 5.25% rate and, as reflected in the table above, your market adjusted value
will be less than your accumulation value.
EXAMPLE 2: Remember again that your contract is earning 4.5%, and assume that
new contracts that we offer with a seven-year guarantee period are earning 4.0%.
We add 0.25% to the 4.0% rate we are paying on new contracts, which equals
4.25%, and compare that number to the 4.5% you are earning on your contract. In
this example, your contract's 4.5% rate is greater than the 4.25% rate, and, as
reflected in the table above, your market adjusted value will be greater than
your accumulation value. To determine that adjustment precisely, you will have
to use the formula described below.
As shown in the table headed "Surrender charge percentage," when your guarantee
period is 10 years and you have begun your fourth contract year from the
beginning of the guarantee period, your surrender charge percentage is 5%. In
either of our two examples, a 5% surrender charge would be deducted from the
market adjusted value.
The precise market adjusted value formula is as follows:
<Table>
(RENEWAL VALUE)
MARKET ADJUSTED VALUE = --------------------
(1 + iMvi)(N + t)
</Table>
<Table>
Renewal value = The accumulation value at the end of the current guarantee period
iMvi = The current interest rate offered for a new Guaranteed Term Annuity
+.0025
N = The number of complete contract years to the end of the current guarantee
period
t = The fraction of the contract year remaining to the end of the contract
year
(for example, if 180 days remain in a 365-day contract year, it would be
.493)
</Table>
The current interest rate we offer on the Guaranteed Term Annuity will change
periodically at our discretion. It is the rate we are then paying on purchase
payments and renewals paid under this class of contracts for guarantee period
durations equaling the remaining guarantee period of the contract to which the
formula is being applied. If the remaining guarantee period is a number of
complete years, we will use the specific complete year guarantee rate. If the
remaining guarantee period is less than one year, we will use the one year
guarantee rate. If the remaining guarantee period is a number of complete years
plus fractional years, we will determine the rate by straight line interpolation
between the two years' rates. For example, if the remaining guarantee period
duration is 8.5 years, and the current guaranteed interest rate for eight years
is 4% and nine years is 5%, RiverSource Life will use a guaranteed interest rate
of 4.5%.
MARKET VALUE ADJUSTMENT FORMULA:
Market value adjustment = Market adjusted value less accumulation value
For an illustration showing an upward and downward adjustment, see Appendix B.
RIVERSOURCE GUARANTEED TERM ANNUITY -- PROSPECTUS 11
PREMIUM TAXES
Certain state and local governments impose premium taxes on us (up to 3.5%).
These taxes depend upon the state of residence or the state in which the
contract was sold. Currently, we deduct any applicable premium taxes when
annuity payments begin, but we reserve the right to deduct this tax at other
times such as when you make purchase payments or when you surrender your
contract.
DEATH BENEFIT PRIOR TO SETTLEMENT
If you or the annuitant die before the settlement date, the death benefit
payable to the beneficiary will equal the accumulation value. We will determine
the accumulation value as of the date our death claim requirements are
fulfilled. We pay interest, if any, at a rate no less than required by law. If
requested, we will mail payment to the named beneficiary within seven days after
our death claim requirements are fulfilled. If there is no named beneficiary,
then the default provisions of your contract will apply.
NONQUALIFIED ANNUITIES
If your spouse is sole beneficiary and you die before the settlement date, your
spouse may keep the contract as owner with the contract value equal to the death
benefit that would otherwise have been paid. To do this your spouse must, within
60 days after our death claim requirements are fulfilled, give us written
instructions to continue the contract as owner.
If your beneficiary is not your spouse, we will pay the beneficiary in a lump
sum unless you give us other written instructions. Generally, we must fully
distribute the death benefit within five years of your death. However, the
beneficiary may receive payments under any annuity payment plan available under
this contract if:
- the beneficiary asks us in writing within 60 days after our death claim
requirements are fulfilled; and
- payments begin no later than one year after your death, or other date
permitted by the IRS; and
- the payment period does not extend beyond the beneficiary's life or life
expectancy.
QUALIFIED ANNUITIES
- SPOUSE BENEFICIARY: If you have not elected an annuity payment plan, and if
your spouse is the sole beneficiary, your spouse may either elect to treat the
contract as his or her own with the contract value equal to the death benefit
that would otherwise have been paid or elect an annuity payment plan or
another plan agreed to by us. If your spouse elects a payment plan, the
payments must begin no later than the year in which you would have reached age
70 1/2. If you attained age 70 1/2 at the time of death, payments must begin
no later than Dec. 31 of the year following the year of your death.
- NON-SPOUSE BENEFICIARY: If you have not elected an annuity payment plan, and
if death occurs prior to the year you would have attained age 70 1/2, the
beneficiary may elect to receive payments from the contract over a five year
period. If your beneficiary does not elect a five year payment period, or if
your death occurs after attaining age 70 1/2, we will pay the beneficiary in a
lump sum unless the beneficiary elects to receive payments under any payment
plan available under this contract if:
- the beneficiary asks us in writing within 60 days after our death claim
requirements are fulfilled; and
- payments begin no later than one year following the year of your death; and
- the payment period does not extend beyond the beneficiary's life or life
expectancy.
- ANNUITY PAYMENT PLAN: If you elect an annuity payment plan, the payments to
your beneficiary will continue pursuant to the annuity payment plan you elect.
DEATH BENEFIT PAYMENT IN A LUMP SUM: We may pay all or part of the death benefit
to your beneficiary in a lump sum under either a nonqualified or qualified
annuity. We pay all proceeds by check (unless the beneficiary has chosen to have
death benefit proceeds directly deposited into another Ameriprise Financial,
Inc. account). If the beneficiary chooses the checking account option, the
proceeds will be deposited into an interest bearing checking account issued by
Ameriprise Bank, FSB, member FDIC unless the beneficiary fails to meet the
requirements of using this option.
THE ANNUITY PAYMENT PERIOD
THE SETTLEMENT DATE
Annuity payouts are scheduled to begin on the settlement date. This means that
the contract will be annuitized (converted to a stream of monthly payments) and
the first payment will be sent on the settlement date. If your contract is
annuitized, the contract goes into payout mode and only the annuity payout
provisions continue. Unless Annuity Payout Plan E is elected, you will no longer
have access to your contract value. In addition, the death benefit and any
optional benefits you have elected will end. When we processed your application,
we established the settlement date as the maximum age (or contract
12 RIVERSOURCE GUARANTEED TERM ANNUITY -- PROSPECTUS
anniversary, if applicable). We have established a new maximum age (or contract
anniversary) as described below. You also can change the settlement date,
provided you send us written instructions at least 30 days before annuitization
payments begin.
Generally, the settlement date must be no later than the later of the
annuitant's 95th birthday or the tenth contract anniversary. If the annuitant
was age 95 or older and past the tenth contract anniversary when the new maximum
was established, the new settlement date was set to a birthday later than age
95. You can also choose to delay the annuitization of your contract beyond age
95 indefinitely, to the extent allowed by applicable tax laws.
Six months prior to your settlement date, we will contact you with your options,
including the option to postpone your annuitization start date to a future date.
If you do not make an election, annuity payouts, using the contract's default
option of Plan B-Life annuity with 10 years certain, will begin on the
settlement date, and your monthly annuity payments will continue for as long as
you live. If you do not survive 10 years, your beneficiaries will continue to
receive payments until 10 years of payments have been made.
If you own a qualified annuity (for example, an IRA) and tax laws require that
you take distributions from your annuity prior to your new retirement start
date, your contract will not be automatically annuitized. If you satisfy your
RMDs for a qualified annuity in the form of partial surrenders from this
contract, you are electing to defer annuitizing your contract. Contract owners
of IRAs and TSAs may also be able to satisfy RMDs by electing other IRAs or
TSAs, and in that case, will delay the start of annuitization payments for these
contracts.
ANNUITY PAYMENTS: The first payment will be made as of the settlement date. Once
annuity payments have started for an annuitant, no surrender of the annuity
benefit can be made for the purpose of receiving a lump sum in lieu of payments
except under Annuity Payment Plan E.
DEATH AFTER SETTLEMENT DATE: If you or the annuitant dies after the settlement
date, the amount payable to the beneficiary, if any, will continue as provided
in the annuity payment plan then in effect.
ANNUITY PAYMENT PLANS
There are different ways to receive annuity payments. We call these plans. You
may select one of these plans, or another payment arrangement to which we agree,
by giving us written notice at least 30 days before the settlement date.
You may ask us to apply the market adjusted value (less applicable premium
taxes, if any) on the settlement date under any of the annuity plans described
below, but in the absence of an election, we will apply the market adjusted
value on the settlement date under Plan B to provide a life annuity with 120
monthly payments certain.
If the amount to be applied to an annuity plan is not at least $2,000 or if
payments are to be made to other than a natural person, we have the right to
make a lump sum payment of the cash surrender value. If a lump sum payment is
from a qualified annuity (except an IRA, Roth IRA or SEP), 20% income tax
withholding may apply.
- PLAN A: This provides monthly annuity payments for the lifetime of the
annuitant. We will not make payments after the annuitant dies.
- PLAN B: This provides monthly annuity payments for the lifetime of the
annuitant with a guarantee by us that payments will be made for a period of at
least five, ten or 15 years. You must select the period.
- PLAN C: This provides monthly annuity payments for the lifetime of the
annuitant with a guarantee by us that payments will be made for a certain
number of months. We determine the number of months by dividing the market
adjusted value applied under this plan by the amount of the monthly annuity
payment.
- PLAN D: We call this a joint and survivor life annuity. Monthly payments will
be paid while both the annuitant and a joint annuitant are living. When either
the annuitant or joint annuitant dies, we will continue to make monthly
payments until the death of the surviving annuitant. We will not make payments
after the death of the second annuitant.
- PLAN E: This provides monthly fixed dollar annuity payments for a period of
years that you elect. The period of years may be no less than 10 nor more than
30. At any time after one year of payments, you can elect to have us determine
the present value of any remaining payments and pay it to you in a lump sum.
The discount rate we use in the calculation is based on the annual effective
interest rate for then-current payment amounts for immediate annuities with
the same purchase amount and remaining term length plus 1.5% (see "Description
of Contracts -- Surrender Charge -- Surrender charge under Annuity Payment
Plan E"). A 10% IRS penalty tax could apply if you make a surrender (see
"Taxes"). This feature is not available in all states. Please contact your
sales representative for availability.
Other annuity payment plan options may be available.
RIVERSOURCE GUARANTEED TERM ANNUITY -- PROSPECTUS 13
The contract provides for annuity payment plans on a fixed basis only. The
amount of the annuity payment will depend on:
- the market adjusted value (less any applicable premium tax not previously
deducted) on the settlement date;
- the annuity table we are then using for annuity settlements (never less than
the table guaranteed in the contract);
- the annuitant's age; and
- the annuity payment plan selected.
The tables for Plans A, B, C and D are based on the "1983 Individual Annuitant
Mortality Table A" and an assumed rate of 4% per year. The table for Plan E is
based on an interest rate of 4%. RiverSource Life may, at our discretion, if
mortality appears more favorable and interest rates justify, apply other tables
that will result in higher monthly payments.
ANNUITY PAYMENT PLAN REQUIREMENTS FOR QUALIFIED ANNUITIES: If you elect an
annuity payment plan from your qualified annuity, it must comply with certain
IRS regulations governing RMDs. In general, your annuity payment plan will meet
these regulations if it meets the incidental distribution benefit requirements,
if any, and the payments are made:
- in equal or substantially equal payments over a period not longer than the
life of the annuitant or over the life of the annuitant or designated
beneficiary; or
- in equal or substantially equal payments over a period not longer than the
life expectancy of the annuitant or over the life expectancy of the annuitant
and designated beneficiary; or
- over a period certain not longer than the life expectancy of the annuitant or
over the life expectancy of the annuitant and designated beneficiary.
AMENDMENT, DISTRIBUTION AND ASSIGNMENT OF CONTRACTS
AMENDMENT OF CONTRACTS
We reserve the right to amend the contracts to meet the requirements of
applicable federal or state laws or regulations. We will notify you in writing
of any such amendments.
DISTRIBUTION OF CONTRACTS
RiverSource Distributors, Inc. ("RiverSource Distributors"), our affiliate,
serves as the principal underwriter and general distributor of the contract. Its
offices are located at 70100 Ameriprise Financial Center, Minneapolis, MN 55474.
RiverSource Distributors is a wholly-owned subsidiary of Ameriprise Financial,
Inc.
SALES OF THE CONTRACT
The contracts are continuously offered to the public through an affiliated
broker-dealer that is registered with the SEC and a member of the FINRA. We and
RiverSource Distributors have a selling agreement with the selling firm. The
selling agreement authorizes the selling firm to offer the contract to the
public. We pay the selling firm (or an affiliated insurance agency) commissions
for contracts its sales representatives sell. The selling firm may be required
to return sales commissions under certain circumstances including, but not
limited to your cancellation of a contract.
PAYMENTS TO THE SELLING FIRM
Under the selling agreement, we pay time-of-sale commissions of up to 6% of
purchase payments on the contract as well as service/trail commissions of up to
0.125% based on annual total accumulation value of the contract for as long as
the contract remains in effect. We also may pay a temporary additional sales
commission of up to 1% of purchase payments on the contract for a period of time
we select.
From time to time and in accordance with applicable laws and regulations, we may
also pay or provide the selling firm with various cash and non-cash promotional
incentives including, but not limited to bonuses, short-term sales incentive
payments, marketing allowances, costs associated with sales conferences and
educational seminars and sales recognition awards.
SOURCES OF PAYMENTS TO THE SELLING FIRM
We pay the commissions and other compensation described above from our assets.
Our assets include revenues we receive from fees and expenses that you will pay
when buying, owning and surrendering the contract and revenues we receive from
other contracts and policies we sell and other businesses we conduct.
You do not directly pay the commissions and other compensation described above
as the result of a specific charge or deduction under the contract. However, you
may pay part of all of the commissions and other compensation described above
indirectly through fees and expenses we collect from you in connection with your
contract, including surrender charges.
14 RIVERSOURCE GUARANTEED TERM ANNUITY -- PROSPECTUS
POTENTIAL CONFLICTS OF INTEREST
The compensation payment arrangement with the selling firm can potentially:
- give the selling firm a heightened financial incentive to sell the contract
offered in this prospectus over another investment with lower compensation to
the selling firm.
- cause the selling firm to encourage its sales representatives to sell you the
contract offered in this prospectus instead of selling you other alternative
investments that may result in lower compensation to the selling firm.
PAYMENTS TO SALES REPRESENTATIVES
A portion of the payments made to the selling firm may be passed on to its sales
representatives in accordance with its internal compensation programs. Those
programs may also include other types of cash and non-cash compensation and
other benefits. Ask your sales representative for further information about what
your sales representative and the selling firm for which he or she works may
receive in connection with your purchase of a contract.
ASSIGNMENT OF CONTRACTS
You may change ownership of your annuity at any time by completing a change of
ownership form we approve and sending it to our home office. No change of
ownership will be binding on us until we receive and record it. If you have a
qualified annuity, the contract may not be sold, assigned, transferred,
discounted or pledged as collateral for a loan or as security for the
performance of an obligation or for any other purpose except as required or
permitted by the Code; provided, however, that if the owner is a trust or
custodian, or an employer acting in a similar capacity, ownership of a contract
may be transferred to the annuitant.
TAXES
Under current law, your contract has a tax-deferral feature. Generally, this
means you do not pay income tax until there is a taxable distribution (or deemed
distribution) from the contract. We will send a tax information reporting form
for any year in which we made a taxable or reportable distribution according to
our records.
NONQUALIFIED ANNUITIES
Generally, only the increase in the value of a non-qualified annuity contract
over the investment in the contract is taxable. Certain exceptions apply.
Federal tax law requires that all nonqualified deferred annuity contracts issued
by the same company (and possibly its affiliates) to the same owner during a
calendar year be taxed as a single, unified contract when distributions are
taken from any one of those contracts.
ANNUITY PAYMENTS: Generally, unlike surrenders described below, a portion of
each payment will be ordinary income and subject to tax, and a portion of each
payment will be considered a return of part of your investment in the contract
and will not be taxed. All amounts you receive after your investment in the
contract is fully recovered will be subject to tax. Under Annuity Payment Plan
A: Life annuity -- no refund, where the annuitant dies before your investment in
the contract is fully recovered, the remaining portion of the unrecovered
investment may be available as a federal income tax deduction to the owner for
the last taxable year. Under all other annuity payment plans, where the annuity
payments end before your investment in the contract is fully recovered, the
remaining portion of the unrecovered investment may be available as a federal
income tax deduction to the taxpayer for the tax year in which the payments end.
(See "The Annuity Payment Period -- Annuity Payment Plans.")
SURRENDERS: Generally, if you withdraw all or part of your nonqualified annuity
before your annuity payments begin, your surrender will be taxed to the extent
that the contract value immediately before the surrender exceeds the investment
in the contract. Different rules may apply if you exchange another contract into
this contract.
You also may have to pay a 10% IRS penalty for surrenders of taxable income you
make before reaching age 59 1/2 unless certain exceptions apply.
WITHHOLDING: If you receive taxable income as a result of an annuity payment or
surrender, we may deduct federal, and in some cases state, withholding against
the payment. Any withholding represents a prepayment of your tax due for the
year. You take credit for these amounts on your annual income tax return. As
long as you have provided us with a valid Social Security Number or Taxpayer
Identification Number and you have a valid U.S. address, you may be able to
elect not to have any withholding occur.
If the payment is part of an annuity payment plan, we generally compute the
amount of withholding using payroll tables. You may provide us with a statement
of how many exemptions to use in calculating the withholding. If the
distribution is any other type of payment (such as partial or full surrender) we
compute withholding using 10% of the taxable portion.
The withholding requirements differ if we deliver payment outside the United
States and/or you are a non-resident alien.
RIVERSOURCE GUARANTEED TERM ANNUITY -- PROSPECTUS 15
Some states also may impose withholding requirements similar to the federal
withholding described above. If this should be the case, we may deduct state
withholding from the payment.
DEATH BENEFITS TO BENEFICIARIES: The death benefit under a nonqualified contract
is not exempt from estate (federal or state) or income taxes. In addition, any
amount your beneficiary receives that exceeds the investment in the contract is
taxable as ordinary income to the beneficiary in the year he or she receives the
payments.
ANNUITIES OWNED BY CORPORATIONS, PARTNERSHIPS OR IRREVOCABLE TRUSTS: For
nonqualified annuities, any annual increase in the value of annuities held by
such entities (nonnatural persons) generally will be treated as ordinary income
received during that year. However, if the trust was set up for the benefit of a
natural person only, the income will generally remain tax-deferred.
PENALTIES: If you receive amounts from your nonqualified annuity before reaching
age 59 1/2, you may have to pay a 10% IRS penalty on the amount includable in
your ordinary income. However, this penalty will not apply to any amount
received:
- because of your death or in the event of nonnatural ownership, the death of
the annuitant;
- because you become disabled (as defined in the Code);
- if the distribution is part of a series of substantially equal periodic
payments, made at least annually, over your life or life expectancy (or joint
lives or life expectancies of you and your beneficiary);
- if it is allocable to an investment before Aug. 14, 1982; or
- if annuity payments are made under immediate annuities as defined by the Code.
TRANSFER OF OWNERSHIP: Generally, if you transfer ownership of a nonqualified
annuity without receiving adequate consideration, the transfer may be treated as
a surrender for federal income tax purposes. If the transfer is a currently
taxable event for income tax purposes, the original owner will be taxed on the
amount of deferred earnings at the time of the transfer and also may be subject
to the 10% IRS penalty discussed earlier. In this case, the new owner's
investment in the contract will be the value of the contract at the time of the
transfer. In general, this rule does not apply to transfers between spouses or
former spouses. Please consult your tax advisor for further details.
1035 EXCHANGES: Section 1035 of the Code permits nontaxable exchanges of certain
insurance policies, endowment contracts annuity contracts and qualified long-
term care insurance contracts. while providing for continued tax deferral of
earnings. In addition, Section 1035 permits the carryover of the cost basis from
the old policy or contract to the new policy or contract. A 1035 exchange is a
transfer from one policy or contract to another policy or contract. The
following are nontaxable exchanges: (1) the exchange of a life insurance policy
for another life insurance policy or for an endowment, annuity or qualified
long-term care insurance contract, (2) the exchange of an endowment contract for
an annuity or qualified long-term care insurance contract, or for an endowment
contract under which payments will begin no later than payments would have begun
under the contract exchanged, (3) the exchange of an annuity contract for
another annuity contract or for a qualified long-term care insurance contract
and (4) the exchange of a qualified long-term care insurance contract for a
qualified long-term care insurance contract. However, if the life insurance
policy has an outstanding loan, there may be tax consequences. Depending on the
issue date of your original policy or contract, there may be tax or other
benefits that are given up to gain the benefits of the new policy or contract.
Consider whether the features and benefits of the new policy or contract
outweigh any tax or other benefits of the old contract.
For a partial exchange of an annuity contract for another annuity contract, the
1035 exchange is generally tax-free. The investment in the original contract and
the earnings on the contract will be allocated proportionately between the
original and new contracts. However, IRS Revenue Procedure 2008-24 states if
withdrawals are taken from either contract within a 12 month period following a
partial exchange, the 1035 exchange may be invalidated. In that case, the
following will occur 1) the tax-free nature of the partial exchange can be lost,
2) the exchange will be retroactively treated as a taxable surrender on the
lesser of the earnings in the original contract or the amount exchanged and 3)
the entire amount of the exchange will be treated as a purchase into the second
contract. You may receive an emailed Form 1099-R reporting an invalidated
exchange. (If certain life events occur between the date of the partial exchange
and the date of the withdrawal in the first 12 months, the partial exchange
could remain valid.) You should consult your tax advisor before taking any
surrender from either contract.
ASSIGNMENT: If you assign or pledge your contract as collateral for a loan,
earnings on purchase payments you made after Aug. 13, 1982 will be taxed as a
deemed distribution and you may have to pay a 10% IRS penalty.
QUALIFIED ANNUITIES
Adverse tax consequences may result if you do not ensure that contributions,
distributions and other transactions under the contract comply with the law.
Qualified annuities have minimum distribution rules that govern the timing and
amount of
16 RIVERSOURCE GUARANTEED TERM ANNUITY -- PROSPECTUS
distributions. You should refer to your retirement plan's Summary Plan
Description, your IRA disclosure statement, or consult a tax advisor for
additional information about the distribution rules applicable to your
situation.
When you use your contract to fund a retirement plan or IRA that is already tax-
deferred under the Code, the contract will not provide any necessary or
additional tax deferral. If your contract is used to fund an employer sponsored
plan, your right to benefits may be subject to the terms and conditions of the
plan regardless of the terms of the contract.
ANNUITY PAYMENTS: Under a qualified annuity, except a Roth IRA, Roth 401(k) or
Roth 403(b), the entire payment generally is includable as ordinary income and
is subject to tax unless: (1) the contract is an IRA to which you made non-
deductible contributions; or (2) you rolled after-tax dollars from a retirement
plan into your IRA; or (3) the contract is used to fund a retirement plan and
you or your employer have contributed after-tax dollars.
ANNUITY PAYMENTS FROM ROTH IRAS: In general, the entire payment from a Roth IRA
can be free from income and penalty taxes if you have attained age 59 1/2 and
meet the five year holding period.
SURRENDERS: Under a qualified annuity, except a Roth IRA, Roth 401(k) or Roth
403(b), the entire surrender will generally be includable as ordinary income and
is subject to tax unless: (1) the contract is an IRA to which you made non-
deductible contributions; or (2) you rolled after-tax dollars from a retirement
plan into your IRA; or (3) the contract is used to fund a retirement plan and
you or your employer have contributed after-tax dollars.
SURRENDERS FROM ROTH IRAS: In general, the entire payment from a Roth IRA can be
free from income and penalty taxes if you have attained age 59 1/2 and meet the
five year holding period.
REQUIRED MINIMUM DISTRIBUTIONS: Retirement plans (except for Roth IRAs) are
subject to required surrenders called required minimum distributions ("RMDs")
beginning at age 70 1/2. RMDs are based on the fair market value of your
contract at year-end divided by the life expectancy factor. Certain death
benefits may be considered in determining the fair market value of your contract
for RMD purposes. This may cause your RMD to be higher. Inherited IRAs
(including inherited Roth IRAs) are subject to special RMD rules. You should
consult your tax advisor prior to making a purchase for an explanation of the
potential tax implications to you.
WITHHOLDING FOR IRAS, ROTH IRAS, SEPS AND SIMPLE IRAS: If you receive taxable
income as a result of an annuity payment or a surrender, we may deduct
withholding against the payment. Any withholding represents a prepayment of your
tax due for the year. You take credit for these amounts on your annual income
tax return. As long as you have provided us with a valid Social Security Number
or Taxpayer Identification Number, you can elect not to have any withholding
occur.
If the payment is part of an annuity payment plan, we generally compute the
amount of withholding using payroll tables. You may provide us with a statement
of how many exemptions to use in calculating the withholding. If the
distribution is any other type of payment (such as a partial or full surrender)
we compute withholding using 10% of the taxable portion.
The withholding requirements differ if we deliver payment outside the United
States and/or you are a non-resident alien.
Some states also may impose withholding requirements similar to the federal
withholding described above. If this should be the case, we may deduct state
withholding from the payment.
WITHHOLDING FOR ALL OTHER QUALIFIED ANNUITIES: If you receive directly all or
part of the contract value from a qualified annuity, mandatory 20% federal
income tax withholding (and possibly state income tax withholding) generally
will be imposed at the time the payment is made from the plan. Any withholding
represents a prepayment of your tax due for the year. You take credit for these
amounts on your annual income tax return. This mandatory withholding will not be
imposed if instead of receiving the distribution check, you elect to have the
distribution rolled over directly to an IRA or another eligible plan;
In the below situations, the distribution is subject to an optional 10%
withholding. We will withhold 10% of the distribution amount unless you elect
otherwise.
- the payment is one in a series of substantially equal periodic payments, made
at least annually, over your life or life expectancy (or the joint lives or
life expectancies of you and your designated beneficiary) or over a specified
period of 10 years or more;
- the payment is a RMD as defined under the Code;
- the payment is made on account of an eligible hardship; or
- the payment is a corrective distribution.
Payments made to a surviving spouse instead of being directly rolled over to an
IRA are subject to mandatory 20% income tax withholding.
State withholding also may be imposed on taxable distributions.
RIVERSOURCE GUARANTEED TERM ANNUITY -- PROSPECTUS 17
PENALTIES: If you receive amounts from your qualified contract before reaching
age 59 1/2, you may have to pay a 10% IRS penalty on the amount includable in
your ordinary income. However, this penalty generally will not apply to any
amount received:
- because of your death;
- because you become disabled (as defined in the Code);
- if the distribution is part of a series of substantially equal periodic
payments made at least annually, over your life or life expectancy (or joint
lives or life expectancies of you and your beneficiary);
- if the distribution is made following severance from employment during the
calendar year in which you attain age 55 (TSAs and annuities funding 401(a)
plans only);
- to pay certain medical or education expenses (IRAs only); or
- if the distribution is made from an inherited IRA.
DEATH BENEFITS TO BENEFICIARIES: The entire death benefit generally is taxable
as ordinary income to the beneficiary in the year he/she receives the payments
from the qualified annuity. If you made non-deductible contributions to a
traditional IRA, the portion of any distribution from the contract that
represents after-tax contributions is not taxable as ordinary income to your
beneficiary. You are responsible for keeping all records tracking your non-
deductible contributions to an IRA. Death benefits under a Roth IRA generally
are not taxable as ordinary income to the beneficiary if certain distribution
requirements are met.
ASSIGNMENT: You may not assign or pledge your qualified contract as collateral
for a loan.
OTHER
IMPORTANT: Our discussion of federal tax laws is based upon our understanding of
current interpretations of these laws. Federal tax laws or current
interpretations of them may change. For this reason and because tax consequences
are complex and highly individual and cannot always be anticipated, you should
consult a tax advisor if you have any questions about taxation of your contract.
RIVERSOURCE LIFE TAX STATUS: We are taxed as a life insurance company under the
Code. For federal income tax purposes, the subaccounts are considered a part of
our company, although their operations are treated separately in accounting and
financial statements. Investment income is reinvested in the fund in which each
subaccount invests and becomes part of that subaccount's value. This investment
income, including realized capital gains, is not subject to any withholding
because of federal or state income taxes. We reserve the right to make such a
charge in the future if there is a change in the tax treatment of variable
annuities or in our tax status as we then understand it.
TAX QUALIFICATION: We intend that the contract qualify as an annuity for federal
income tax purposes. To that end, the provisions of the contract are to be
interpreted to ensure or maintain such tax qualification, in spite of any other
provisions of the contract. We reserve the right to amend the contract to
reflect any clarifications that may be needed or are appropriate to maintain
such qualification or to conform the contract to any applicable changes in the
tax qualification requirements. We will send you a copy of any amendments.
THE COMPANY
BUSINESS
We issue the contracts. We are a stock life insurance company organized in 1957
under the laws of the state of Minnesota and are located at 70100 Ameriprise
Financial Center, Minneapolis, MN 55474. We are a wholly-owned subsidiary of
Ameriprise Financial, Inc.
We conduct a conventional life insurance business. We are licensed to do
business in 49 states, the District of Columbia and American Samoa. Our primary
products currently include fixed and variable annuity contracts and life
insurance policies.
INVESTMENTS BY RIVERSOURCE
RiverSource Life must invest its assets in its general account in accordance
with requirements established by applicable state laws regarding the nature and
quality of investments that life insurance companies may make and the percentage
of their assets that they may commit to any particular type of investment. In
general, these laws permit investments, within specified limits and subject to
certain qualifications, in federal, state, and municipal obligations, corporate
bonds, asset-backed securities, preferred and common stocks, real estate
mortgages, real estate and certain other investments. All claims by purchasers
of the contracts, and other general account products, will be funded by the
general account.
We intend to construct and manage the investment portfolio relating to these
market value annuity contracts in such a way as to minimize the impact of
fluctuations by interest rates. We seek to achieve this by constructing a
portfolio of assets with a price
18 RIVERSOURCE GUARANTEED TERM ANNUITY -- PROSPECTUS
sensitivity to interest rate changes (i.e., price duration) that is similar to
the price duration of the corresponding portfolio of liabilities.
Our investment strategy will incorporate the use of a variety of debt
instruments having price durations tending to match the applicable guaranteed
interest periods. These instruments include, but are not necessarily limited to,
the following:
- Securities issued by the U.S. government or its agencies or instrumentalities,
which issues may or may not be guaranteed by the U.S. government;
- Debt securities that have an investment grade, at the time of purchase, within
the four highest grades assigned by the nationally recognized rating agencies
or are rated in the two highest grades by the National Association of
Insurance Commissioners;
- Debt instruments that are unrated, but which are deemed by RiverSource Life to
have an investment quality within the four highest grades;
- Other debt instruments, which are rated below investment grade, limited to 15%
of assets at the time of purchase; and
- Real estate mortgages, limited to 30% of portfolio assets at the time of
acquisition.
In addition, options and futures contracts on fixed income securities will be
used from time to time to achieve and maintain appropriate investment and
liquidity characteristics on the overall asset portfolio.
While this information generally describes our investment strategy, we are not
obligated to follow any particular strategy except as may be required by federal
law and Minnesota and other state insurance laws.
LEGAL PROCEEDINGS
RiverSource Life is involved in the normal course of business in legal and
regulatory proceedings, or regulatory requests for information, concerning
matters arising in connection with the conduct of our general business
activities as well as generally applicable to business practices in the
insurance industry. From time to time, we receive requests for information from,
or have been subject to examination by, the SEC, the Financial Industry
Regulatory Authority, commonly referred to as FINRA, and several state
authorities concerning our business activities and practices. These requests
generally include suitability, late trading, market timing, compensation and
disclosure of revenue sharing arrangements with respect to our annuity and
insurance products. We have cooperated with and will continue to cooperate with
the applicable regulators regarding their inquiries and examinations.
RiverSource Life is involved in other proceedings concerning matters arising in
connection with the conduct of its business activities. RiverSource Life
believes that it is not a party to, nor are any of its properties the subject
of, any pending legal, arbitration or regulatory proceedings that would have a
material adverse effect on its consolidated financial condition, results of
operations or liquidity. However, it is possible that the outcome of any such
proceedings could have a material adverse impact on results of operations in any
particular reporting period as the proceedings are resolved.
ADDITIONAL INFORMATION
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
To the extent and only to the extent that any statement in a document
incorporated by reference into this prospectus is modified or superseded by a
statement in this prospectus or in a later-filed document, such statement is
hereby deemed so modified or superseded and not part of this prospectus. The
Annual Report on Form 10-K of RiverSource Life Insurance Company for the year
ended Dec. 31, 2009 previously filed by RiverSource Life with the SEC under the
Securities Exchange Act of 1934 (1934 Act) is incorporated by reference into
this prospectus. To access this document, see "SEC Filings" under "Investor
Relations" at www.ameriprise.com.
RiverSource Life will furnish you without charge a copy of any or all of the
documents incorporated by reference into this prospectus, including any exhibits
to such documents which have been specifically incorporated by reference. We
will do so upon receipt of your written or oral request. You can contact
RiverSource Life at the telephone number and address listed on the first page of
this prospectus.
AVAILABLE INFORMATION
This prospectus is part of a registration statement we file with the SEC.
Additional information on RiverSource Life and on this offering is available in
the registration statement. You can obtain copies of these materials at the
SEC's Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. You
can obtain information on the operation of the Public Reference Room by calling
the SEC at 1-800-SEC-0330. The SEC also maintains an Internet site that contains
reports, proxy information statements and other information regarding issuers
that file electronically with the SEC. This prospectus, other information about
the contract and other information incorporated by reference are available on
the EDGAR Database on the SEC's Internet site at (http://www.sec.gov).
RIVERSOURCE GUARANTEED TERM ANNUITY -- PROSPECTUS 19
INDEMNIFICATION
Insofar as indemnification for liabilities arising under the Securities Act of
1933 (1933 Act) may be permitted to directors and officers or persons
controlling RiverSource Life pursuant to the foregoing provisions, we have been
informed that in the opinion of the SEC such indemnification is against public
policy as expressed in the 1933 Act and is therefore unenforceable.
20 RIVERSOURCE GUARANTEED TERM ANNUITY -- PROSPECTUS
APPENDIX A
PARTIAL SURRENDER ILLUSTRATION
Involving a surrender charge and a market value adjustment
ANNUITY ASSUMPTIONS
<Table>
Single payment $10,000
Guarantee period 10 years
Guarantee rate(ig) 4% effective annual yield
</Table>
<Table>
<Caption>
END OF CONTRACT YEAR
ACCUMULATION VALUES
CONTRACT YEAR SURRENDER CHARGE% IF NO SURRENDERS
1 8% $10,400.00
2 7 10,816.00
3 6 11,248.64
4 5 11,698.59
5 4 12,166.53
6 3 12,653.19
7 2 13,159.32
8 1 13,685.69
9 0 14,233.12
10 0 14,802.44
</Table>
PARTIAL SURRENDER ASSUMPTIONS
On the first day of your fourth contract year you request a partial surrender
of:
Example I -- $2,000 of your accumulation value
Example II -- A $2,000 net surrender check
You may surrender 10% of $11,248.64 (end of third contract year accumulation
value) without surrender charge but subject to a market value adjustment -- this
is $1,124.86
The excess market adjusted value surrendered is subject to both a 5% (fourth
contract year) surrender charge and a market value adjustment.
The current rate applicable for new sales and renewals = 3%
The current rate applicable for new sales and renewals +.0025(iMvi) = 3.25%
The number of full years left in your guarantee period (N) = 7
The number of fractional years left in your guarantee period (t) = 0
EXAMPLE I -- $2,000 of accumulation value surrendered
WHAT WILL BE YOUR MARKET VALUE ADJUSTMENT AMOUNT?
The market adjusted value of your $2,000 partial surrender will be:
<Table>
RENEWAL VALUE OF ACCUMULATION VALUE SURRENDERED
-----------------------------------------------
(1 + iMvi)(N + t)
</Table>
<Table>
$2,000 (1 + ig)7
= ------------------
(1 + iMvi)7
$2,000 (1.04)7
= ------------------
(1.0325)7
= $2,103.94
</Table>
The market value adjustment = the market adjusted value surrendered less the
accumulation value surrendered
$2,103.94 - $2,000 = $103.94
(NOTE: THIS MARKET VALUE ADJUSTMENT IS POSITIVE. IN OTHER CASES THE MARKET VALUE
ADJUSTMENT MAY BE NEGATIVE.)
RIVERSOURCE GUARANTEED TERM ANNUITY -- PROSPECTUS 21
WHAT WILL BE YOUR SURRENDER CHARGE AMOUNT?
The surrender charge will be 5% multiplied by the excess of the market adjusted
value over the accumulation value that may be surrendered without surrender
charge:
($2,103.94 - $1,124.86) x .05 = $48.95
WHAT NET AMOUNT WILL YOU RECEIVE?
Your contract's accumulation value will decrease by $2,000 and we will send you
a check for:
<Table>
Accumulation value
surrendered $2,000.00
Market value adjustment 103.94
Less surrender charge (48.95)
---------
Net surrender amount $2,054.99
</Table>
EXAMPLE II -- $2,000 NET SURRENDER CHECK REQUESTED
WHAT WILL BE THE ACCUMULATION VALUE SURRENDERED?
Tell us if you want a specific net surrender check amount. We will work
backwards using an involved formula to determine how much accumulation value
must be surrendered to result in a net check to you for a specific amount. For a
$2,000 net check to you, the formula results in $1,944.98 of accumulation value
to be surrendered.
WHAT WILL BE YOUR MARKET VALUE ADJUSTMENT AMOUNT?
The market adjusted value is:
<Table>
RENEWAL VALUE OF ACCUMULATION VALUE SURRENDERED
-----------------------------------------------
(1 + iMvi)(N + t)
</Table>
<Table>
$1,944.98 (1 + ig)7
= -------------------
(1 + iMvi)7
$1,944.98 (1.04)7
= -------------------
(1.0325)7
= $2,046.06
</Table>
The market value adjustment = the market adjusted value surrendered less the
accumulation value surrendered
$2,046.06 - $1,944.98 = $101.08
(NOTE: THIS MARKET VALUE ADJUSTMENT IS POSITIVE. IN OTHER CASES THE MARKET VALUE
ADJUSTMENT MAY BE NEGATIVE.)
WHAT WILL BE YOUR SURRENDER CHARGE AMOUNT?
The surrender charge will be 5% multiplied by the excess of the market adjusted
value over the accumulation value that may be surrendered without surrender
charge:
($2,046.06 - $1,124.86) x .05 = $46.06
WHAT NET AMOUNT WILL YOU RECEIVE?
Your contract's accumulation value will decrease by $1,944.98 and we will send
you a check for:
<Table>
Accumulation value
surrendered $1,944.98
Market value adjustment 101.08
Less surrender charge (46.06)
---------
Net surrender amount $2,000.00
</Table>
22 RIVERSOURCE GUARANTEED TERM ANNUITY -- PROSPECTUS
APPENDIX B
MARKET VALUE ADJUSTMENT ILLUSTRATION
ANNUITY ASSUMPTIONS
<Table>
Single payment $50,000
Guarantee period 10 years
Guarantee rate 4% effective annual yield
</Table>
MARKET VALUE ADJUSTMENT ASSUMPTIONS: These examples show how the market value
adjustment may affect your contract values. The surrenders in these examples
occur one year after the contract date. There are no previous surrenders.
The accumulation value at the end of one year is $52,000. If there aren't any
surrenders, the renewal value at the end of the 10-year guarantee period will be
$74,012.21.
We base the market value adjustment on the rate we are crediting (at the time of
your surrender) on new contracts with the same length guarantee period as the
time remaining in your guarantee period. After one year, you have nine years
left of your 10-year guarantee period.
Example I shows a downward market value adjustment. Example II shows an upward
market value adjustment. These examples do not show the surrender charge (if
any) that would be calculated separately after the market value adjustment.
Surrender charge calculations are shown in Appendix A.
MARKET ADJUSTED VALUE FORMULA:
<Table>
(RENEWAL VALUE) -
MARKET ADJUSTED VALUE = (1 + IMVI)(N + T)
</Table>
<Table>
Renewal value = The accumulation value at the end of the current guarantee period
iMvi The current interest rate offered for new contract sales and
renewals for the number of years remaining in the guarantee period
= +.0025
N The number of complete contract years to the end of the current
= guarantee period
t The fraction of the contract year remaining to the end of the
= contract year
</Table>
EXAMPLE I -- Downward market value adjustment
A surrender results in a downward market value adjustment when interest rates
have increased. Assume after one year, we are now crediting 4.5% for a new
contract with a nine-year guarantee period. If you fully surrender, the market
adjusted value would be:
<Table>
RENEWAL VALUE
------------------
(1 + iMvi)(N + t)
</Table>
<Table>
$74,012.21
= ------------
(1 + .0475)9
= $48,743.54
</Table>
The market value adjustment is a $3,256.46 reduction of the accumulation value:
($3,256.46) = $48,743.54 - $52,000
If you surrendered half of your contract instead of all, the market adjusted
value of the surrendered portion would be one-half that of the full surrender:
<Table>
$37,006.11
$24,371.77 = ----------
(1 + .0475)9
</Table>
RIVERSOURCE GUARANTEED TERM ANNUITY -- PROSPECTUS 23
EXAMPLE II -- Upward market value adjustment
A surrender results in an upward market value adjustment when interest rates
have decreased more than .25%. Assume after one year, we are now crediting 3.5%
for a new contract with a nine-year guarantee period. If you fully surrender,
the market adjusted value would be:
<Table>
RENEWAL VALUE
--------------------
(1 + iMvi)(N + t)
</Table>
<Table>
$74,012.21
= --------------
(1 + .0375)9
= $53,138.64
</Table>
The market value adjustment is a $1,138.64 increase of the accumulation value:
$1,138.64 = $53,138.64 - $52,000
If you surrendered half of your contract instead of all, the market adjusted
value of the surrendered portion would be one-half that of the full surrender:
<Table>
$37,006.11
$26,569.32 = ----------
(1 + .0375)9
</Table>
24 RIVERSOURCE GUARANTEED TERM ANNUITY -- PROSPECTUS
(RIVERSOURCE ANNUITIES LOGO)
RiverSource Life Insurance Company
70100 Ameriprise Financial Center
Minneapolis, MN 55474
1 (800) 862-7919
RiverSource Distributors, Inc. (Distributor), Member FINRA. Insurance and
annuity products are issued by
RiverSource Life Insurance Company. Both companies are affiliated with
Ameriprise Financial Services, Inc.
2008-2010 RiverSource Life Insurance Company. All rights reserved.
S-6401 Z (4/10)
PART II.
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 13. Other Expenses of Issuance and Distribution
The expenses of the issuance and distribution of the interests in the
RiverSource Account MGA of RiverSource Life Insurance Company to be registered,
other than commissions on sales of the Contracts, are to be borne by the
registrant.
Item 14. Indemnification of Directors and Officers
The amended and restated By-Laws of the depositor provide that the depositor
will indemnify, to the fullest extent now or hereafter provided for or permitted
by law, each person involved in, or made or threatened to be made a party to,
any action, suit, claim or proceeding, whether civil or criminal, including any
investigative, administrative, legislative, or other proceeding, and including
any action by or in the right of the depositor or any other corporation, or any
partnership, joint venture, trust, employee benefit plan, or other enterprise
(any such entity, other than the depositor, being hereinafter referred to as an
"Enterprise"), and including appeals therein (any such action or process being
hereinafter referred to as a "Proceeding"), by reason of the fact that such
person, such person's testator or intestate (i) is or was a director or officer
of the depositor, or (ii) is or was serving, at the request of the depositor, as
a director, officer, or in any other capacity, or any other Enterprise, against
any and all judgments, amounts paid in settlement, and expenses, including
attorney's fees, actually and reasonably incurred as a result of or in
connection with any Proceeding, except as provided below.
No indemnification will be made to or on behalf of any such person if a judgment
or other final adjudication adverse to such person establishes that such
person's acts were committed in bad faith or were the result of active and
deliberate dishonesty and were material to the cause of action so adjudicated,
or that such person personally gained in fact a financial profit or other
advantage to which such person was not legally entitled. In addition, no
indemnification will be made with respect to any Proceeding initiated by any
such person against the depositor, or a director or officer of the depositor,
other than to enforce the terms of this indemnification provision, unless such
Proceeding was authorized by the Board of Directors of the depositor. Further,
no indemnification will be made with respect to any settlement or compromise of
any Proceeding unless and until the depositor has consented to such settlement
or compromise.
The depositor may, from time to time, with the approval of the Board of
Directors, and to the extent authorized, grant rights to indemnification, and to
the advancement of expenses, to any employee or agent of the depositor or to any
person serving at the request of the depositor as a director or officer, or in
any other capacity, of any other Enterprise, to the fullest extent of the
provisions with respect to the indemnification and advancement of expenses of
directors and officers of the depositor.
Insofar as indemnification for liability arising under the Securities Act of
1933 (the "Act") may be permitted to directors, officers and controlling persons
of the depositor or 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 liabilities (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 15. Recent Sales of Unregistered Securities
Not Applicable.
Item 16. (A) Exhibits
1. Form of Principal Underwriter Agreement for RiverSource Life Insurance
Company Variable Annuities and Variable Life Insurance filed electronically as
Exhibit 3.1 to the Initial Registration Statement on Form N-4 for RiverSource
Variable Annuity Account, RiverSource Signature(SM) Select Variable Annuity and
RiverSource Signature(SM) Variable Annuity, on or about Jan. 2, 2007, is
incorporated by reference.
2.1 Articles of Merger of IDS Life Insurance Company and American
Enterprise Life Insurance Company dated March 16, 2006, filed electronically as
Exhibit 2.1 to Post-Effective Amendment No. 8 to Registration Statement No.
333-114888, is incorporated by reference.
2.2 Articles of Merger of IDS Life Insurance Company and American Partners
Life Insurance Company dated March 17, 2006, filed electronically as Exhibit 2.2
to the Initial Registration Statement on Form S-1 for RiverSource Life Insurance
Company, is incorporated by reference.
3.1 Copy of Certificate of Incorporation of IDS Life Insurance Company
filed electronically as Exhibit 3.1 to Post-Effective Amendment No. 5 to
Registration Statement No. 33-28976 is incorporated herein by reference.
3.2 Copy of Certificate of Amendment of Certificate of Incorporation of IDS
Life Insurance Company dated June 22, 2006, filed electronically as Exhibit
27(f)(1) to Post-Effective Amendment No. 28 to Registration Statement No.
333-69777 is incorporated by reference.
3.3 Copy of Amended and Restated By-Laws of RiverSource Life Insurance
Company filed electronically as Exhibit 27(f)(2) to Post-Effective Amendment No.
28 to Registration Statement No. 333-69777 is incorporated by reference.
3.4 Copy of Resolution of the Board of Directors of IDS Life Insurance
Company, dated May 5, 1989, establishing IDS Life Account MGA filed
electronically as Exhibit 3.3 to Post-Effective Amendment No. 5 to Registration
Statement No. 33-28976 is incorporated herein by reference.
3.5 Unanimous Written Consent of the Board of Directors In Lieu of a
Meeting for IDS Life Insurance Company, adopted Dec. 8, 2006 for the
Re-designation of the Separate Accounts to Reflect Entity Consolidation and
Rebranding filed electronically as Exhibit 27(a)(6)
to Post-Effective Amendment No. 28 to Registration Statement No. 333-69777 is
incorporated by reference.
4.1 Copy of Non-tax qualified Group Annuity Contract, Form 30363C, filed
electronically as Exhibit 4.1 to Post-Effective Amendment No. 5 to Registration
Statement No. 33-28976 is incorporated herein by reference.
4.2 Copy of Non-tax qualified Group Annuity Certificate, Form 30360C, filed
electronically as Exhibit 4.2 to Post-Effective Amendment No. 5 to Registration
Statement No. 33-28976 is incorporated herein by reference.
4.3 Copy of Endorsement No. 30340C-GP to the Group Annuity Contract filed
electronically as Exhibit 4.3 to Post-Effective Amendment No. 5 to Registration
Statement No. 33-28976 is incorporated herein by reference.
4.4 Copy of Endorsement No. 30340C to the Group Annuity Certificate filed
electronically as Exhibit 4.4 to Post-Effective Amendment No. 5 to Registration
Statement No. 33-28976 is incorporated herein by reference.
4.5 Copy of Tax qualified Group Annuity Contract, Form 30369C, filed
electronically as Exhibit 4.5 to Post-Effective Amendment No. 10 to Registration
Statement No. 33-28976 is incorporated herein by reference.
4.6 Copy of Tax qualified Group Annuity Certificate, Form 30368C, filed
electronically as Exhibit 4.6 to Post-Effective Amendment No. 10 to Registration
Statement No. 33-28976 is incorporated herein by reference.
4.7 Copy of Group IRA Annuity Contract, Form 30372C, filed electronically
as Exhibit 4.7 to Post-Effective Amendment No. 10 to Registration Statement No.
33-28976 is incorporated herein by reference.
4.8 Copy of Group IRA Annuity Certificate, Form 30371C, filed
electronically as Exhibit 4.8 to Post-Effective Amendment No. 10 to Registration
Statement No. 33-28976 is incorporated herein by reference.
4.9 Copy of Non-tax qualified Individual Annuity Contract, Form 30365D,
filed electronically as Exhibit 4.9 to Post-Effective Amendment No. 10 to
Registration Statement No. 33-28976 is incorporated herein by reference.
4.10 Copy of Endorsement No. 30379 to the Individual Annuity Contract,
filed electronically as Exhibit 4.10 to Post-Effective Amendment No. 10 to
Registration Statement No. 33-28976 is incorporated herein by reference.
4.11 Copy of Tax qualified Individual Annuity Contract, Form 30370C, filed
electronically as Exhibit 4.11 to Post-Effective Amendment No. 10 to
Registration Statement No. 33-28976 is incorporated herein by reference.
4.12 Copy of Individual IRA Annuity Contract, Form 30373C, filed
electronically as Exhibit 4.12 to Post-Effective Amendment No. 10 to
Registration Statement No. 33-28976 is incorporated herein by reference.
4.13 Copy of Endorsement No. 33007 filed electronically as Exhibit 4.13 to
Post-Effective Amendment No. 12 to Registration Statement No. 33-28976 is
incorporated herein by reference.
4.14 Form of Traditional IRA or SEP-IRA Annuity Endorsement (form 131061)
filed electronically as Exhibit 4.14 to Post-Effective Amendment No. 17 to
Registration Statement No. 33-28976 is incorporated herein by reference.
4.15 Form of Roth IRA Annuity Endorsement (form 131062) filed
electronically as Exhibit 4.15 to Post-Effective Amendment No. 17 to
Registration Statement No. 33-28976 is incorporated herein by reference.
4.16 Form of Simple IRA Annuity Endorsement (form 131063) filed
electronically as Exhibit 4.13 to Post-Effective Amendment No. 14 to
Registration Statement No. 333-79311, is incorporated by reference.
4.17 Form of TSA Endorsement (form 131068), filed electronically as Exhibit
4.17 to Post-Effective Amendment No. 2 to Registration Statement No. 333-79311,
is incorporated by reference.
4.18 Form of Deferred Annuity Contract for Retirement Advisor Advantage
Plus (form 1043A) filed electronically as Exhibit 4.15 to IDS Life Variable
Account 10 Post-Effective Amendment No. 21 to Registration Statement No.
333-79311, filed on or about Jan. 23, 2004, is incorporated by reference.
4.19 Form of Deferred Annuity Contract for Retirement Advisor Select Plus
(form 131041A) filed electronically as Exhibit 4.16 to IDS Life Variable Account
10 Post-Effective Amendment No. 21 to Registration Statement No. 333-79311,
filed on or about Jan. 23, 2004, is incorporated by reference.
4.20 Form of Guarantee Period Accounts Rider filed electronically as
Exhibit 4.24 to IDS Life Variable Account 10 Post-Effective Amendment No. 25 to
Registration Statement No. 333-79311, filed on or about June 2, 2004, is
incorporated by reference.
4.21 Form of Deferred Annuity Contract for RiverSource Retirement Advisor 4
Advantage (form 131101) filed electronically as Exhibit 4.17 to IDS Life
Variable Account 10 Post-Effective Amendment No. 40 to Registration Statement
No. 333-79311, filed on or about June 5, 2006, is incorporated by reference.
4.22 Form of Deferred Annuity Contract for RiverSource Retirement Advisor 4
Select Variable Annuity (form 131102) filed electronically as Exhibit 4.18 to
IDS Life Variable Account 10 Post-Effective Amendment No. 40 to Registration
Statement No. 333-79311, filed on or about June 5, 2006 is incorporated by
reference.
4.23 Form of Deferred Annuity Contract for RiverSource Retirement Advisor
Access Variable Annuity (form 131103) filed electronically as Exhibit 4.19 to
IDS Life Variable Account 10 Post-Effective Amendment No. 40 to Registration
Statement No. 333-79311, filed on or about June 5, 2006 is incorporated by
reference.
5. Opinion of Counsel regarding legality of Contracts filed electronically
as Exhibit 5 to Registration Statement No. 333-149953 on or about March 28, 2008
is incorporated by reference.
6.-20. Not Applicable.
21. Copy of List of Subsidiaries filed electronically as Exhibit 22 to
Post-Effective Amendment No. 8 to Registration Statement No. 33-28976 is
incorporated herein by reference.
22. Not Applicable.
23. Consent of Independent Registered Public Accounting Firm filed
electronically herewith.
24. Power of Attorney to sign the Registration Statement and Amendments to
this Registration Statement, dated Oct. 22, 2008 filed electronically as Exhibit
13. to Post-Effective Amendment No. 53 to Registration Statement No. 333-79311
is incorporated herein by reference.
25.-99. Not Applicable
Item 17. Undertakings
A. The Registrant undertakes:
(1) to file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933,
(ii) to reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement,
(iii) to include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or
any material change to such information in the Registration Statement,
(2) that, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
Registration Statement relating to the securities offered therein, and the
offering of such securities at that time may be deemed to be the initial bona
fide offering thereof,
(3) that all post-effective amendments will comply with the applicable
forms, rules and regulations of the Commission in effect at the time such
post-effective amendments are filed, and
(4) to remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
B. The Registrant represents that it is relying upon the no-action assurance
given to the American Council of Life Insurance (pub. Avail. Nov. 28, 1988).
Further, the Registrant represents that it has complied with the provisions of
paragraphs (1) - (4) of the no-action letter.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant,
RiverSource Life Insurance Company has duly caused this Registration Statement
to be signed on its behalf by the undersigned, thereunto duly authorized in the
City of Minneapolis, and State of Minnesota on the 23rd day of April, 2010.
RiverSource Life Insurance Company
(Registrant)
By /s/ John R. Woerner*
------------------------------------
John R. Woerner
Chairman of the Board and President
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the following persons in the capacities indicated
on the 23rd day of April, 2010.
Signature Title
/s/ Gumer C. Alvero* Director and Executive Vice
------------------------------------- President - Annuities
Gumer C. Alvero
/s/ Richard N. Bush* Senior Vice President - Corporate Tax
-------------------------------------
Richard N. Bush
/s/ Brian J. McGrane* Director, Executive Vice President and
------------------------------------- Chief Financial Officer
Brian J. McGrane
/s/ Kevin E. Palmer* Director, Vice President and Chief
------------------------------------- Actuary
Kevin E. Palmer
/s/ Bridget M. Sperl* Director and Executive Vice President -
------------------------------------- Client Services
Bridget M. Sperl
/s/ David K. Stewart* Vice President and Controller
------------------------------------- (Principal Accounting Officer)
David K. Stewart
/s/ William F. "Ted" Truscott* Director
-------------------------------------
William F. "Ted" Truscott
/s/ John R. Woerner* Chairman of the Board and President
-------------------------------------
John R. Woerner
* Signed pursuant to Power of Attorney dated Oct.22, 2008 filed
electronically as Exhibit 13 to Post-Effective Amendment No. 53 to
Registration Statement No. 333-79311 is incorporated by reference herewith,
by:
/s/ Rodney J. Vessels
-------------------------------------
Rodney J. Vessels
Assistant General Counsel and
Assistant Secretary
EXHIBIT INDEX
5. Opinion of Counsel regarding legality of Contracts is filed electronically
herewith.
23. Consent of Independent Registered Public Accounting Firm.