THE CORPORATE LIBRARY

Related Party Transactions and Outside Related Director Information

St. Paul Travelers Companies, Inc. (The) (STA)

3/17/2006 Proxy Information

Aircraft Lease

LCG Enterprises LLC, a limited liability company of which Mr. Lipp is the sole member (“LCG”), owns and, until November 1, 2005, leased to The Travelers Indemnity Company (“Indemnity”), a subsidiary of the Company, a Falcon 50 aircraft on a month-to-month basis for business purposes. Pursuant to the lease, which had been in place since May 2002, Indemnity was responsible for the operation and maintenance of the aircraft and paid to LCG $989 per hour of actual flight time. Indemnity did not incur an hourly charge when the aircraft was not used or when Mr. Lipp used the aircraft for personal reasons. Mr. Lipp could use the aircraft and other Company-owned aircraft for personal travel, and he agreed to reimburse the Company for his personal use of any of the aircraft at the maximum non-charter rate permitted by the Federal Aviation Administration rules. From January 1, 2005 through November 1, 2005, the Company paid $15,033 to LCG for use of the aircraft, and Mr. Lipp reimbursed the Company $386,752 for his personal use of Company aircraft. The lease was terminated and this LCG aircraft discontinued use of the Company’s hangar on November 1, 2005.

Legal Services

As noted above, King & Spalding LLP provided legal services to the Company in 2005 and continues to provide services to the Company in 2006. Mr. Graev, a director of the Company, was Of Counsel at this law firm during 2005 and until January 31, 2006, when he resigned from that position.

Investment Banking Services

Mr. Lipp, a director of the Company, is an executive officer and director of JPMorgan Chase & Co., the parent company of the investment banking firm J.P. Morgan Securities Inc. (“JPMSI”). JPMSI performed investment banking services for the Company during 2005, and JPMSI may perform such services for the Company during 2006. Subsidiaries of JPMorgan Chase & Co. also participate in the Company’s $1 billion credit facility, provide cash management and custody services to the Company, serve as trustee with respect to various securities issued by the Company or its affiliates and act as trustee for certain of the Company’s employee benefit plans.

9/13/2005 8K Information

Mr. Lipp served as Executive Chairman of St. Paul Travelers Companies, Inc. from April 2004 to mid-September 2005. Mr. Lipp served as Chairman and Chief Executive Officer of Travelers Property Casualty Corporation from December 2001 until it merged into St. Paul Travelers Companies, Inc. in April 2004. He served as Chairman of Travelers Insurance Group Holdings Inc. from 1996 to 2000 and from January 2001 to October 2001, and was the Chief Executive Officer and President of Travelers Insurance Group Holdings Inc. from 1996 to 1998.

3/25/2005 Proxy Information

LCG Enterprises LLC, a limited liability company of which Mr. Lipp is the sole member (“LCG”), owns and leases to Travelers Indemnity Company (“Indemnity”), a subsidiary of the Company, a Falcon 50 aircraft on a month-to-month basis for business purposes. Pursuant to the lease, which has been in place since May 2002, Indemnity is responsible for the operation and maintenance of the aircraft and pays to LCG $989 per hour of actual flight time. Indemnity does not incur an hourly charge when the aircraft is not used or when Mr. Lipp uses the aircraft for personal reasons. Mr. Lipp may use the aircraft and other Company-owned aircraft for personal travel and has agreed to reimburse the Company for his personal use of any of the aircraft at the maximum non-charter rate permitted by the Federal Aviation Administration rules. In March 2005, the compensation committee of the Board of Directors determined, based in part on the advice of independent consultants, that the terms of the lease are more favorable to the Company than those under which the Company could obtain the use of a comparable aircraft from an unaffiliated third party. In 2004, the Company (and Travelers prior to the Merger) paid $232,711 to LCG for use of the aircraft, and Mr. Lipp reimbursed the Company (and Travelers prior to the Merger) $297,401 for his personal use of Company aircraft.

Legal Services

As noted above, King & Spalding LLP provided legal services to Travelers, St. Paul and the Company in 2004 and continues to provide services to the Company in 2005. Mr. Graev, a director of the Company, is Of Counsel at this law firm.

Investment Banking Services

Mr. Scharf, a director of the Company, is an executive officer of JPMorgan Chase & Co., the parent company of the investment banking firm J.P. Morgan Securities Inc. (“JPMSI”). Although JPMSI did not perform investment banking services for the Company during 2004, JPMSI may perform such services for the Company during 2005.

Certain Litigation Matters

Two derivative actions have been brought purportedly on behalf of the Company against all current directors and naming the Company as a nominal defendant. The plaintiff shareholders allege state law claims, including breach of fiduciary duty, alleging, in one case, that certain disclosures relating to the Merger contained false or misleading statements with respect to the value of St. Paul’s loss reserves and, in the other case, mismanagement of and failure to make disclosure relating to the practice of paying brokers commissions on a contingent basis. The Company is obligated to the extent provided under Minnesota law to indemnify its officers and directors in respect of these lawsuits and other lawsuits arising out of alleged similar facts and circumstances. The Company retained special counsel, who determined that the directors were entitled to advances of their costs of defense under the Minnesota Business Corporation Act. Accordingly, the Company will advance officers and directors attorneys’ fees and other expenses they may incur in defending these lawsuits.

6/10/2004 Proxy Information

Aircraft Lease

LCG Enterprises LLC, a limited liability company of which Mr. Lipp is the sole member, owns and leases to Travelers a Falcon 50 aircraft on a month-to-month basis for business purposes. Pursuant to the lease, Travelers is responsible for the operation and maintenance of the aircraft and pays to LCG $989 per hour of actual flight time. Travelers does not incur an hourly charge when the aircraft is not used or when Mr. Lipp uses the aircraft for personal reasons. Mr. Lipp may use the aircraft and other Company-owned aircraft for personal travel and has agreed to reimburse Travelers for his personal use of any of the aircraft at the maximum non-charter rate permitted by the Federal Aviation Administration rules. The Travelers audit committee has determined annually that the terms of the lease are more favorable to Travelers than those under which Travelers could obtain the use of a comparable aircraft from an unaffiliated third party. In 2003, Travelers paid $321,118 to LCG for use of the aircraft, and Mr. Lipp reimbursed Travelers $249,044 for his personal use of Travelers aircraft.

Mr. Lipp served as Chairman and Chief Executive Officer of Travelers Property Casualty Corporation from December 18, 2001 until the company merged into St. Paul Travlers Companies, Inc. in April, 2004. He served as Chairman of Travelers Insurance Group Holdings Inc. from 1996 to 2000 and from January 2001 to October 2001, and was the Chief Executive Officer and President of Travelers Insurance Group Holdings Inc. from 1996 to 1998. From 1993 to 2000, he was Chairman and Chief Executive Officer of Travelers Insurance Group Inc., a Travelers predecessor company. From 1991 to 1998, he was a Vice-Chairman of Travelers Group, Inc.

Investment Management Agreement

On September 30, 2003, Travelers entered into an investment management agreement with BlackRock HPB Management LLC ("BlackRock HPB"), an investment management company that is majority owned by BlackRock, Inc., a public investment company, pursuant to which BlackRock HPB is now managing a portion of the Company's investment portfolio. Howard P. Berkowitz, a director of the Company, is CEO of BlackRock HPB. The investment management fees that will be paid to BlackRock HPB are based upon percentages of the net asset value of the assets being managed, plus an incentive fee if BlackRock HPB achieves certain minimum investment performance results. For 2003, Travelers incurred approximately $550,000 in investment advisory fees payable to BlackRock HPB and incurred approximately $290,000 in fees through April 30, 2004, not including incentive fees that may be earned for full-year 2004 investment performance results.

Investment in Subsidiary

On August 1, 2002, Commercial Insurance Resources, Inc. ("CIRI"), a Company subsidiary and the holding company for the Gulf Insurance Group ("Gulf"), completed an investment transaction with a group of outside investors and senior employees of Gulf. Trident II, L.P. ("Trident") and its related co-investment funds, Marsh & McLennan Capital Professionals Fund, L.P., Marsh & McLennan Employees' Securities Company, L.P. and Trident Gulf Holding, LLC invested $125.0 million in the aggregate, and a group of senior employees of Gulf invested $14.2 million, a portion of which was financed by CIRI. Meryl D. Hartzband, a director of the Company, is a Senior Principal and the Investment Director of MMC Capital, Inc. ("MMC Capital"), the manager of Trident, and also a member of the investment committee of the general partner of Trident. MMC Capital is a wholly owned subsidiary of Marsh & McClennan Companies, Inc.

The Company intends to integrate the Gulf business with the Company's specialty business beginning in the second quarter of 2004. On May 27, 2004, Travelers repurchased from Trident and its related co-investment funds their entire equity and debt investments in CIRI for the amounts originally invested, plus accrued and unpaid interest and dividends.

Legal Services

Skadden, Arps, Slate, Meagher & Flom LLP provided legal services to Travelers and St. Paul during 2003 and continues to provide services to the Company in 2004. Kenneth J. Bialkin, a director of the Company, is a partner in this law firm.

RELATIONSHIPS WITH CITIGROUP

Travelers had been a wholly owned subsidiary of Citigroup Inc. ("Citigroup") until March 2002, when Travelers completed an initial public offering of stock, and Citigroup retained majority control of Travelers (the "IPO"). In August 2002, Citigroup spun-off to its shareholders Citigroup's controlling interest in Travelers and retained an approximately 9.9% share of Travelers voting stock for its own account (the "Citigroup Distribution"). As a result of the Merger between St. Paul and Travelers, as of April 30, 2004, Citigroup held approximately 6.3% of the Company's common stock for its own account and approximately an additional 2.5% of the Company's common stock on behalf of customers of Citigroup.

Prior to the IPO, Travelers and Citigroup had agreements between them that addressed various business relationships. However, in connection with the IPO, Travelers and Citigroup terminated these agreements and entered into new agreements, including a new intercompany agreement dated as of March 26, 2002, as amended on August 19, 2002. Certain terms of the intercompany agreement and other agreements and arrangements between Travelers and Citigroup and its affiliates are summarized below to the extent that they remained in effect or transactions occurred pursuant to them in 2003.

Intercompany Agreement

Intellectual Property. Travelers owns the "Travelers" name and mark, but Travelers granted Citigroup the right to make various uses of the "Travelers" name and mark for two years from March 22, 2002, subject to certain conditions. Citigroup owns the "umbrella" mark and granted Travelers a right to make various uses of the "umbrella" mark and other Citigroup marks for two years from March 22, 2002. In addition, Travelers agreed to enter into a License Agreement with The Travelers Insurance Company, a Citigroup subsidiary ("TIC"), pursuant to which Travelers would grant TIC the right to use the "Travelers Life and Annuity," "The TIC" and "The Travelers Life and Annuity Company" names and marks and other names and marks containing "Travelers" for use in Citigroup's life insurance and annuity business, subject to certain conditions.

Indemnification. Travelers will indemnify Citigroup and its officers, directors, employees and agents against losses arising from certain actions by Travelers. Citigroup will indemnify Travelers and its officers, directors, employees and agents against losses arising from certain actions by Citigroup.

Business Relationships. Travelers has an agreement for Citigroup to distribute Travelers property and casualty insurance products through Citigroup's distribution channels. Travelers continued to purchase annuities for structured settlements from Citigroup on the same economic terms that existed at the IPO through 2003, and thereafter may purchase them on terms to be mutually agreed upon. During 2004, Travelers has and may continue to use Citigroup as a preferred provider of structured settlement annuities for claims, as long as Citigroup maintains competitive ratings and its products are competitively priced.

Right of First Offer. For a period of two years following the Citigroup Distribution, Travelers has the right of first offer to provide Citigroup property and casualty coverage that Travelers does not currently provide it, and Citigroup has the right of first offer to provide Travelers any financial service it did not provide Travelers at the time of the Citigroup Distribution, at market rates, terms and conditions at the time of the offer. Neither party is required to purchase the services at rates, terms or conditions less favorable than those offered by any third party at the time of the offer.

Other Provisions. The intercompany agreement also provides for various other matters, including: (i) the provision of insurance and allocation and/or reimbursement of costs and premiums of that insurance; (ii) the provision of data processing services and allocation and/or reimbursement of costs of those services; (iii) cross-licensing of computer software; (iv) volume purchasing arrangements; (v) registration rights; and (vi) provisions governing other relationships among members of Citigroup, on the one hand, and Travelers, on the other hand.

Trademark License Agreement

Travelers and TIC entered into a Trademark License Agreement dated as of August 19, 2002. Under this agreement, except for marks already in use by TIC, any new corporate or trade name adopted by TIC and its affiliates must contain the term "Travelers Life & Annuity." In addition, any trademark, service mark, domain name, or other source indicator adopted by TIC and its affiliates must meet the criteria set forth in certain trademark guidelines. TIC must cease use of Travelers marks within 2 years after certain events, including Citigroup ceasing to control TIC.

Transition Services Agreement

Travelers and Citigroup entered into a transition services agreement dated August 19, 2002 for the provision of certain systems, corporate, administrative and other shared services and facilities sharing after the Citigroup Distribution. The term for the provision of each service is one year, except for data processing services and related support, which is two years, services related to the accident department of TIC operated for the benefit of Travelers, which is two years, and payroll and human resources services, which is two years plus the remaining portion of the second calendar year. Except for payroll and human resources services, each service is subject to an extension for another one-year term upon advance notice from the receiving party. The cost for the provision of each transition service reflects payment terms consistent with the cost allocation before the Citigroup Distribution.

Asbestos Indemnification Agreement

Travelers entered into an agreement with Citigroup that provided that if in any fiscal year Travelers recorded additional asbestos-related income statement charges in excess of $150 million, net of any reinsurance, Citigroup would pay to Travelers the amount of any such excess up to a cumulative aggregate of $800 million, reduced by the tax effect of the highest applicable federal income tax rate. As a result of Travelers adding to its asbestos reserves through the fourth quarter of 2002, Travelers has utilized all of the benefits under the agreement.

Investment Advisory

Travelers entered into an Investment Management and Administrative Services Agreement dated as of August 6, 2002 (the "IMA") with Citigroup Alternative Investments LLC ("CAI"), a Citigroup affiliate. Under the IMA, CAI provided investment advisory and administrative services with respect to Travelers' investment portfolio at fees determined under the agreement, including a component based on performance. Charges incurred related to this agreement were $59.7 million for 2003 and approximately $53 million through March 31, 2004. Charges incurred for the first quarter of 2004 include approximately $42 million of investment performance fees resulting primarily from investment gains of a private equity trading partnership. The Company does not believe that performance fees of such amounts will recur, and actual performance fees payable to CAI depend upon full year investment performance. The initial term of this agreement expired on March 31, 2004, and on that date, Travelers and CAI entered into an agreement limiting CAI's investment advisory services to selected assets, terminating the provisions of the agreement relating to administrative services, and extending the term of the agreement to the earlier of June 30, 2004 or the date on which the parties enter into a new agreement to replace the IMA. Investment advisory fees under the extended IMA are determined on the same basis as under the IMA. In addition, Travelers and Trumbull Street Investments LLC, another Citigroup affiliate, have entered into a Transition Services Agreement and an Administrative Services Agreement in order to effect an orderly transition of investment-related accounting and administrative services to the Company following the Merger. These agreements have stated terms expiring on December 31, 2004 and provide for compensation to Trumbull of $1 million per month for administrative services plus time and materials for transition services.

Tax Allocation Agreement

Travelers and Citigroup are parties to a tax allocation agreement, which generally provides for the allocation of income tax liabilities between Travelers and Citigroup and certain other matters during the periods for which Travelers is included in Citigroup's consolidated tax return. Under the tax allocation agreement, Travelers will indemnify Citigroup for tax liabilities that are allocated to Travelers.

Brokerage and Investment Banking

In the ordinary course of business, Travelers purchases and sells securities through Citigroup's broker-dealers. These transactions are conducted on an arm's-length basis. Commissions are not paid for the purchase and sale of debt securities. In addition, Salomon Smith Barney Inc., an affiliate of Citigroup ("SSB"), performs investment banking and advisory services for Travelers. In March 2003, SSB was one of the initial purchasers of Travelers debt offering of senior notes, and SSB received customary fees for the transaction. In addition, in 2003, Citigroup Global Markets, Inc. served as a financial advisor to Travelers in connection with the Merger and received financial advisory fees of $4.0 million. SSB is also providing other investment banking services.

Credit Facilities

Effective April 17, 2003, Travelers entered into the following line of credit agreements with Citibank, a subsidiary of Citigroup: (i) a $250.0 million 45-month revolving line of credit (the "45-Month Line of Credit"), and (ii) a $250.0 million 364-day revolving line of credit (the "364-Day Line of Credit" and, together with the 45-Month Line of Credit, the "Lines of Credit"). Borrowings under the Lines of Credit may be made, at Travelers option, at a variable interest rate equal to either the lender's base rate plus an applicable margin or at LIBOR plus an applicable margin. Each Line of Credit includes a commitment fee and, for any date on which advances exceed 50% of the total commitment, a utilization fee. The applicable margin and the rates on which the commitment fee and the utilization fee are based vary depending upon Travelers long-term senior unsecured non-credit-enhanced debt ratings. There were no amounts outstanding under the Lines of Credit at December 31, 2003. The 364-Day Line of Credit expired on April 16, 2004 and was not renewed.

Citibank is also the administrative agent on, and has a $35 million commitment under, the Company's five year $270 million line of credit that expires in June 2007. Citibank is also the lead arranger and the administrative agent on, and has a $25 million commitment under, the Company's $330 million 364-Day Line of Credit, which expires June 11, 2004. It is expected that Citibank will be the lead arranger and administrative agent for, and have a substantial commitment under, a replacement facility.

The following graph shows a five-year comparison of the cumulative total return for the Company's common stock and the common stock of companies included in the S&P 500 Index and the S&P Property-Casualty Index, which the Company believes is the most appropriate comparative index.

3/28/2003 Proxy Information

No related party transactions or special relationships reported for this company. Director relationships marked "Outside Related" at this firm will most often be former executives of the company. Additional information regarding these relationships will be added during our regular updates.