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C. FDIC Insurance <br />J.P. Morgan charges a Premium Assessment Fee (PAF), which is a <br />monthly administrative fee assessed to address various regulatory and <br />other charges affecting J.P. Morgan. <br />In calculating the earnings credit rate (ECR), J.P. Morgan currently does <br />not deduct the reserve requirement from the available balance. <br />Since October r, 2oo8, the Federal Reserve has paid interest on reserves <br />held at the Federal Reserve by member banks. J.P. Morgan passes this <br />benefit to clients by basing the earnings credit on l00% of the eligible <br />balance of non - interest bearing demand deposit accounts. <br />The following formula is used to calculate the PAF: <br />d. Service Charge Credit <br />Any cash remaining in a non - interest bearing demand deposit account <br />uninvested at the end of the day is used to determine an earnings credit <br />value on account balances. This credit is calculated by J.P. Morgan, and <br />the total credit accrued for the month is reflected on the monthly account <br />analysis statement and is applied to reduce the invoiced amount due for <br />banking service fees. <br />J.P. Morgan uses the following formula to calculate the monthly earnings <br />credit allowance: <br />(Average Daily Positive Ledger Balance x ECR x Actual Number Of Days in Month) / <br />Actual Number of Days in Year <br />C. Once the contract has been awarded, the Bank will not be permitted to <br />charge the City for any fees not listed on the Cost /Bid Form. The only <br />exceptions to this limitation will be if the City specifically requests additional <br />services not identified in the RFP or in Bank's proposal. The fees for new <br />services will be negotiated and added to the contract as an amendment or <br />through a change order process. However, if a regulatory agency imposes a <br />fee to the Bank which is passed through to all Bank customers then all such <br />fees shall be accommodated. <br />J.P. Morgan acknowledges the requirement. <br />Page iii J.P. Morgan <br />55E -208 <br />