HomeMy WebLinkAboutEMPOWER ANNUITY INSURANCE COMPANYINSURANCE ON FILE
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ClCITY CLERK
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RESTATED
MASTER SERVICES AGREEMENT
for
CITY OF SANTA ANA
(the "Plan Sponsor")
Empower Group Client Number
960140
A-2023-164
City C7jty1IIF0M0jLU1- 19 — 4 9/19/2023
TABLE OF CONTENTS
1.
DEFINITIONS........................................................................................................................................3
2.
SCOPE OF THE AGREEMENT...........................................................................................................4
3.
FEES/CHARGES ..................................................................................................................................4
4.
CONFIDENTIALITY..............................................................................................................................4
5.
DATA PROTECTION............................................................................................................................5
6.
BUSINESS CONTINUITY & DISASTER RECOVERY........................................................................6
7.
RECORDS............................................................................................................................................6
8.
INTELLECTUAL PROPERTY RIGHTS...............................................................................................6
9.
INDEMNIFICATION, LIMITATION OF LIABILITY & INSURANCE.....................................................7
10.
DISPUTE RESOLUTION......................................................................................................................7
11.
TERM & TERMINATION......................................................................................................................8
12.
MISCELLANEOUS............................................................................................................I..................8
EXHIBIT 1: DATA SECURITY & PRIVACY ADDENDUM... ............................................... _ ...................
13
EXHIBIT 2: PROCEDURES FOR COMPLYING WITH FUND COMPANY MARKET TIMING
AND
EXCESSIVE TRADING..............................................................................................................................19
EXHIBIT3: PRIVACY NOTICE..................................................................................................................20
EXHIBIT 4: BUSINESS CONTINUITY PLAN NOTICE..............................................................................22
SCHEDULE A-1: RECORDKEEPING SERVICES & FEE SCHEDULE..................................................23
EXHIBIT A-1: APPROVED QDRO PROCEDURES AND MODEL FORM FOR QUALIFIED PLANS ....47
EXHIBITA-2: PERFORMANCE STANDARDS........................................................................................59
SCHEDULE B: INVESTMENT ADVISORY & MANAGEMENT SERVICES SCHEDULE ........................63
EXHIBIT B-1: DISCRETIONARY INVESTMENT ADVISORY AND NON -DISCRETIONARY SERVICES.
............................................................................................................................................................ 72
EXHIBITB-2:EAG ADV BROCHURE........................................................................................................76
City i y OtanC 19 - 5 9/19/2023
This Restated Master Services Agreement is dated October 1, 2023, or such earlier or later date as modified
under Section 11.1 herein, ("Effective Date") and sets forth the general terms and conditions under which
Empower Annuity Insurance Company (fka Prudential Retirement Insurance and Annuity Company) will
provide Services to the undersigned Plan Sponsor with respect to the employee benefit plan(s) sponsored
by Plan Sponsor, as identified in the attached Schedules (the "Plan" or "Plans"). This MSA amends and
restates the Administrative Services Agreement effective October 1, 2018 between the parties in its entirety.
DEFINITIONS
"Affiliate" means a corporate entity that directly or indirectly is controlled by or is under common control
with a party, including any entity that conforms to this definition after the effective date of this MSA.
"Aareement" includes this Master and any Exhibits, Schedules, notices and other documents attached,
incorporated or referenced herein.
'Business Dav" means any day, and only for as many hours as, the New York Stock Exchange is open.
"Code" means the Internal Revenue Code of 1986, as amended from time to time.
"Data" has the meaning set forth in the Data Security & Privacy Addendum, attached as Exhibit 1.
"Data Protection Laws" has the meaning set forth in the Data Security & Privacy Addendum, attached as
Exhibit 1.
"Direction" and "Direct" and their similar terms shall mean the instruction, authorization, or direction given
to Empower by the Plan Sponsor, another fiduciary of the Plan, or a person that Empower reasonably
believes to be authorized to act on behalf of the Plan Sponsor or another fiduciary. Plan Sponsor directs
Empower to process certain Plan transactions based solely on Participant instruction under the terms of
this MSA.
"ERISA" means the Employee Retirement Income Security Act of 1974, as amended from time to time.
"Empower" refers to Empower Annuity Insurance Company and Its Affiliates with respect to products and
Services offered in the retirement markets, including but not limited to recordkeeping and other financial
services.
"Information Security_ Breach" has the meaning set forth in the Data Security & Privacy Addendum,
attached as Exhibit 1.
"Investment Options" means those investment options made available under the Plan based on Plan
Sponsor or another Plan investment fiduciary designated by the Plan Sponsor (other than Empower or one
of its Affiliates).
"MSA" means this Master Services Agreement.
"Participant" shall mean an employee, former employee, participant, former participant, member,
beneficiary or alternate payee who is or may be entitled to participate in or receive benefits under the Plan.
"Personal Data" has the meaning set forth in the Data Security & Privacy Addendum, attached as Exhibit
1.
City OF
y ounce - 19 — 6 9/19/2023
"Plan Administrator" means a designated employee or committee, or a third party retained by Plan
Sponsor or named in the Plan (other than Empower or one of its Affiliates), to be the "plan administrator"
and "named fiduciary" as defined by applicable law.
"Plan Data" has the meaning set forth in the Data Security & Privacy Addendum, attached as Exhibit 1.
"Plan Sponsor" means the Plan Sponsor identified above, the Plan Administrator, named fiduciaries, and
other delegates of the Plan Sponsor (other than Empower or one of its Affiliates) as dictated by the context.
"Services" means the services provided by Empower or an Empower Affiliate, as applicable, acting as a
service provider Directed by the Plan Sponsor to perform such Services under an applicable Schedule.
Empower shall provide the Services in a non -fiduciary capacity (except where Empower acknowledges its
fiduciary status in writing). The provision of Services shall be governed by the terms and conditions set
forth in this MSA, by applicable law and regulations and any additional terms and conditions contained in
the applicable Schedule.
2. SCOPE OF THE AGREEMENT
This MSA sets forth the terms and conditions pursuant to which Plan Sponsor may receive Services
from Empower or an Empower Affiliate, as the case may be, pursuant to a separate Services Schedule
attached hereto. These terms and conditions will be deemed to be incorporated by reference into each and
every Schedule entered into between the parties. Each Schedule will be a separate agreement between
Plan Sponsor and the Empower Affiliate that enters into the Schedule. All references to "Empower" in this
MSA will be deemed references to Empower or the Empower Affiliate, as the case may be, that entered
into the Schedule.
3. FEES/CHARGES
3.1 Fees / Charges. Plan Sponsor agrees to pay Empower for the Services in accordance with
the terms of each Schedule or attachment hereto. Unless otherwise Directed by the Plan Sponsor, the Plan
Sponsor hereby Directs Empower to deduct applicable Plan expenses from the Plan and/or Participant
accounts, as applicable.
4. CONFIDENTIALITY
4.1 Confidential Information. In order to perform the Services, both parties may have access
to certain information of the other party, including, without limitation, trade secrets, commercial and
competitively sensitive information of the party related to business methods or practices, and proprietary
information, software or websites of a party ("Confidential Information"). For the purpose of clarity, any
software orwebsite owned, licensed, or made available by Empower ("Empower Software") Is Confidential
Information of Empower. The parties mutually agree to hold all Confidential Information of the other party
In confidence and not to disclose any Confidential Information of the other party to anyone except the
parties' Affiliates, suppliers, and respective personnel in connection with the performance or receipt of
Services hereunder, or as otherwise directed or approved by the other party or its agents. Confidential
Information does not include: information that is otherwise in the public domain through no action of the
non -disclosing party; information that is acquired by a party from a person other than the other party or Its
City OF Y ounce — 19 — 7 9/19/2023
agents without any obligation of confidentiality; or information that is independently developed by a party
without reference to the Confidential Information of the other party.
4.2 Permitted Disclosures of Confidential Information.
4.2.1 Legally Required Disclosures. In the event a party is required to make a legally
required disclosure of the other party's Confidential Information, such party shall notify the other party of
the disclosure as soon as reasonably practicable and shall cooperate with any efforts by such party to
obtain protective treatment of such Confidential Information to the extent permitted by law. The foregoing
shall not apply to (i) broad -based regulatory examinations associated with a party's general business or
operations; (ii) disclosures made in conjunction with a law enforcement investigation or inquiry; (iii) or where
notice is prohibited by law. For purposes of Rule 14(b)-1 and Rule 14(b)-2 of the Securities Exchange Act
of 1934, as amended from time to time, Plan Sponsor authorizes Empower, and/or its Affiliates and services
providers, to provide the name, address and share position of the Plan with respect to any class of securities
registered under the Investment Company Act of 1940 when requested by such SEC registrant for purposes
of shareholder meetings. The above -referenced rules prohibit the requesting SEC registrant from using the
Plan's name and address for any purpose other than corporate communications of the type contemplated
under the rules.
4.2.2 Authorized Disclosures. Plan Sponsor authorizes Empower to disclose Data to
Empower's Affiliates and service providers in connection with Empower's performance of Services under
this MSA. In addition, Plan Sponsor authorizes Empower to disclose Data to Plan Sponsor's advisors, third -
party administrators, service providers (such as payroll providers) and representatives authorized by Plan
Sponsor in writing to receive such Data. Empower may use and disclose, for benchmarking and research
purposes, de -identified Data that is aggregated with other anonymized data of a similar nature across
Empower's client base in a manner that makes such Data unidentifiable to a particular individual or plan.
Empower's current Privacy Notice is attached to this MSA but shall not lessen any of Empower's obligations
regarding Personal Data hereunder. Plan Sponsor agrees that any changes to the Privacy Notice may be
delivered to Plan Sponsor through the Plan Service Center or by email to designated representatives of
Plan Sponsor.
4.2.3 Disclosures of Personal Data to Plan Sponsor. Plan Sponsor may Direct
Empower to provide Plan Sponsor or its designated agent with information (which may include Personal
Data) received from or in relation to Participants in connection with the performance of Services under this
MSA, which may include private information shared by the Participant during recorded phone calls and
written or electronic correspondence.
5. DATA PROTECTION
5.1. Mutual Obligation to Protect Data. Empower and Plan Sponsor each agree to maintain
and hold in confidence all Data and Confidential Information, as applicable, received in connection with the
performance of Services under this MSA. Empower and Plan Sponsor agree that their collection, use and
disclosure of all Data is and will at all times be conducted in compliance with all applicable Data Protection
Laws. Each party will implement, support, and maintain appropriate physical and logical security measures
designed to secure Data, and will take all commercially reasonable organizational and technical steps to
protect against unlawful and unauthorized processing of Personal Data. In accordance with the foregoing,
Empower maintains a comprehensive data security program designed to safeguard Data and access to the
City I Y ounce _ 19 — 8 9/19/2023
Empower Software and systems, as further set forth in the Data Security & Privacy Addendum attached
hereto as Exhibit 1.
5.2. Mutual Notice of an Information Security Breach. (A) Notice by Empower. Empower
will notify the Plan Sponsor of an Information Security Breach as set forth Exhibit 1, Data Security & Privacy
Addendum. (B) Notice by Plan Sponsor. In order to help Empower facilitate the safety of Data and
Participant accounts, Plan Sponsor will notify Empower: (1) promptly in the event of a security breach of
Plan Sponsor's systems that could impact Empower's systems or the integrity of Data sent to Empower,
including without limitation a suspected virus or malware event; and/or (ii) immediately upon discovering a
compromise of the security and/or log -on credentials of any Plan Sponsor employee or agent that has a
plan administration role in Empower's system. Such notice shall include: (a) information reasonably
necessary to enable Empower to promptly put additional protective measures in place, such as file
scrubbing protocols and/or fraud alerts on Participant accounts; and (b) the corrective action taken to
remedy the breach.
6. BUSINESS CONTINUITY & DISASTER RECOVERY
Empower will maintain business continuity and disaster recovery procedures to address the
security, integrity and availability of the technology, operational, financial, human and other resources
required to provide mission -critical Services in the event of a natural disaster or other interruption of normal
business operations. Such procedures will be tested at least once annually. Empower Financial Services,
Inc.'s current Business Continuity Plan Notice is attached to this MSA. By executing this MSA, Plan
Sponsor acknowledges receipt of this Notice.
RECORDS
7.1 Record Retention. Empower shall retain all records in its custody and control that are
pertinent to performance under this MSA in accordance with its record retention policy and as required by
law. Subject to the foregoing, each party agrees to return or destroy the other parry's Confidential
Information and Data once it is no longer required for the purpose of performing or receiving the Services,
provided that the parties are not obligated to destroy copies of Confidential Information or Data that roust
be retained for audit, legal or regulatory purposes, or that is stored in non -readily accessible electronic
format, such as on archival systems; in such cases Empower's data protection obligations shall continue
until such Data is destroyed in accordance with Empower's record retention policy.
6. INTELLECTUAL PROPERTY RIGHTS
6.1 Plan Sponsor Materials. As between the parties hereto, excluding the Empower
Materials (as defined below), Plan Sponsor shall own materials, trademarks, trade names, logos, trade
dress, and other Confidential Information provided or made accessible by Plan Sponsor to Empower for
use in providing the Services (collectively, the "Plan Sponsor Materials"). Plan Sponsor grants Empower
a limited, revocable right and license to use Plan Sponsor's name, logo, and trademarks in materials
created by Empower in connection with providing the Services. Nothing contained herein shall prohibit
Empower from referencing client partnerships in the normal course of public -relations communications or
in materials prepared at the request of prospective clients.
City I ou y 6cl - 19 - 9 9/19/2023
8.2 Empower Materials. As between the parties hereto, Empower and its Affiliates shall own
all materials, documentation, user guides, forms, templates, business methods, trademarks, trade names,
logos, websites, Empower Software, technology, computer codes, domain names, text, graphics,
photographs, artwork, interfaces, and other information or material provided by Empower or its Affiliates
hereunder (collectively, the "Empower Materials"). Empower grants to Plan Sponsor and Participants (as
applicable) a non-exclusive, non -transferable license to use the Empower Materials during the term of the
MSA for purposes of using Empower's Services hereunder and subject to the terms and conditions set forth
in this MSA and any terms of use associated with Empower Software. All rights with respect to the Empower
Materials not specifically granted hereunder are reserved by Empower.
9. INDEMNIFICATION, LIMITATION OF LIABILITY & INSURANCE
9.1. Indemnification. Empower agrees to indemnify the Plan Sponsor from and against any
and all expenses, costs, reasonable attorneys' fees, settlements, fines, judgments, damages, liabilities,
penalties or court awards asserted by a third party (collectively, "Damages') to the extent resulting from
Empower's breach of this Agreement, negligence, or willful misconduct. Notwithstanding anything to the
contrary herein, Empower shall not be liable to Plan Sponsor for any Damages resulting from: 1) any acts
or omissions undertaken at the Direction of the Plan Sponsor or any agent or any third party authorized by
Plan Sponsor to provide Direction to Empower, including but not limited to prior service providers,
investment advisors, or any authorized agent thereof; 2) any performance of the Services that is in strict
compliance with the terms of this Agreement; of 3) Plan Sponsor's or its designee's failure to provide
accurate documents, material, information or data to Empower or its Affiliates, as applicable on a timely
basis. Plan Sponsor acknowledges that Empower and its directors, officers, employees and authorized
representatives are not responsible for the investment performance of any Investment Options under the
Plan.
9.2. Limitation of Liability. NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THIS
AGREEMENT, NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR ANY INDIRECT, SPECIAL,
PUNITIVE, INCIDENTAL, OR CONSEQUENTIAL DAMAGES (INCLUDING, WITHOUT LIMITATION,
LOSS OF REVENUE OR PROFIT) EVEN IF THE PARTY HAS BEEN ADVISED OF THE POSSIBILITY
OF SUCH DAMAGES.
9.3. Insurance. Empower will, at its own cost and expense, procure and maintain in full force
and effect throughout the term of this MSA insurance coverage that is reasonably appropriate to the
Services provided under this MSA and any Schedule hereto. The requirements In this section are not
intended to, and will not in any way, limit or qualify the liabilities and obligations of Empower under this
MSA.
10. DISPUTE RESOLUTION
The parties shall engage in reasonable and good faith discussions to resolve any dispute arising
out of or relating to this Agreement. If the parties are unable to agree between themselves, the parties will
submit the dispute to non -binding mediation conducted by a private mediator agreed to by both parties. If
the parties cannot agree on a mediator, the mediator may be selected by a nationally recognized,
independent arbitration or mediation organization to which the parties mutually agree. The costs of
mediation shall be borne equally by the parties, and each party shall pay its own expenses. If the parties
are unable to resolve the dispute through non -binding mediation, either party may initiate litigation;
City t y ounce 19 — 10 9/19/2023
provided, however, that if one party requests mediation and the other party rejects the proposal or refuses
to participate, the requesting party may initiate litigation immediately upon such refusal.
11. TERM & TERMINATION
11.1. Term & Termination. This MSA shall be in effect commencing on the Effective Date set
forth above and continuing for a term of three (3 ) years from October 1, 2023 through September 30, 2026,
(the "Term"). The City may, at its discretion, extend the agreement with the same or more limited scope of
required services for one (1) additional two (2) year period, upon mutual agreement contingent upon City
Council approval, or City Manager or City Attorney authorization, as appropriate. The total term of the
awarded agreement shall not exceed five (5) years. In the event this MSA should terminate or expire prior
to the completion date designated in any Schedule, such Schedule shall terminate concurrently with the
MSA. To the extent any Services are provided prior to the Effective Date, including without limitation,
implementation and conversion services, or the receipt of payroll contributions, the Effective Date of this
MSA is modified to the date that such contributions are determined to be in good order by Empower or its
Affiliate and this MSA will be in effect for the limited purpose of accepting such contributions and holding
them in trust. For all other Services, the Effective Date of the MSA shall be on TOA.
11.2. Termination for Convenience. This MSA or any Schedule attached hereto may be
terminated by either party by delivering ninety (90) days advance written notice to the other party. The
termination of this MSA shall also operate as a termination of all Schedules hereto.
11.3. Termination for Default. Either party may, upon written notice, terminate this MSA or any
Schedule attached hereto if the other party materially breaches or is in default of any material obligation
hereunder, which default is incapable of cure, or which being capable of cure, has not been cured within
ninety (90) days after receipt of notice of such defaultfrom the non -defaulting party, orwithin such additional
cure period as mutually agreed upon by the parties.
11.4. Transition Assistance Services. Upon termination for any reason, Empower will provide
to Plan Sponsor the deconversion and transition assistance services set forth in the Recordkeeping
Services Schedule, attached hereto. For the avoidance of doubt, this MSA will govern the transition
assistance services provided.
12. MISCELLANEOUS
12.1. Affiliates & Agents. Plan Sponsor agrees that Empower may utilize the services of
Affiliates, agents and suppliers selected by Empower. Empower's use of any such party will not relieve
Empower of its obligations under this MSA and Empower shall at all times remain liable for the performance
Of such Services. Plan Sponsor further agrees that the Empower Affiliate entering into each Schedule
(including the terms of the MSA incorporated therein by reference) is separately bound for its performance
obligations contained therein and is not jointly bound with any other entity.
12.2. Relationship of the Parties. The relationship between the parties is that of independent
contractors. Neither party nor its personnel shall be considered employees of the other party for any
purpose. None of the provisions of this MSA shall be construed to create an agency, partnership or joint
venture relationship between the parties or the partners, officers, members or employees of the other party
by virtue of either this MSA or actions taken pursuant to this MSA. The parties shall bear sole responsibility
City I y OL cl - 19 —11 9/19/2023
for its own taxes, including income, franchise, privilege, gross receipts, sales and use, excise, real and
personal property (including software), payroll and any other taxes or assessments, surcharges or
governmental charges that may be imposed, levied, collected or assessed by a taxing jurisdiction. If
applicable, the parties shall reasonably cooperate with each other to enable each party to more accurately
determine its own tax liability and to minimize such liability to the extent legally permissible and
administratively reasonable.
12.3. No Third Party Beneficiaries. This MSA is solely for the benefit of the parties hereto and
their Affiliates and is not intended to confer any rights or remedies upon any other person.
12.4. Assignment. This MSA shall be binding upon and inure to the benefit of each of the
parties, their Affiliates, successors and permitted assigns; provided, however, that neither party may assign
its rights or obligations hereunder without the other party's prior written consent. Notwithstanding the
foregoing, a party may assign this MSA in connection with: (i) the sale of substantially all of its assets or
the assets of any business unit to an entity that assumes the assignor's obligations under this MSA; (ii) a
merger, acquisition or divestiture; and/or (iii) a transfer to a parent or Affiliate, in each case without the other
party's consent.
12.5. Entire Agreement. Each Schedule, including any Exhibits, notices and attachments
(including an incorporation by reference of the terms and conditions of this MSA), constitutes the entire
agreement of the parties thereto with respect to the subject matter thereof and supersedes all prior drafts,
agreements, negotiations and proposals, written or verbal, relating to the Services contained in the
applicable Schedule. This MSA or any Schedule may be amended by written agreement of the parties; for
that purpose, emails do not constitute signed writings. Notwithstanding the foregoing, Empower may add
or enhance the Services, update the method of providing the Services without any reduction in service, or
modify the Services to comply with applicable laws by providing written notice to Plan Sponsor at least 30
days in advance of the effective date of such change, provided that Plan Sponsor may opt out of certain
Services that directly impact Participants and any changes that result in an increase in fees to the Plan.
Any Empower notices or policies that are attached to or referenced in this MSA may be updated by
Empower at any time, provided that such updates shall not materially degrade the rights or protections set
forth therein. No waiver of any breach of any provision of this MSA shall constitute a waiver of any prior,
concurrent or subsequent breach of such provision or any other provision hereof and no waiver shall be
effective unless made in writing.
12.6. Governing Law; Waiver of Jury Trial. Unless and to the extent provided otherwise in a
Schedule hereto, this MSA shall be construed and enforced in accordance with and governed by the laws
of the state of California, without regard to conflict of law principles, and any claim arising under or related
to this MSA shall be subject to the exclusive jurisdiction of the federal and state courts located in California.
Both parties agree to waive any right to have a jury participate in the resolution of any dispute or claim
arising out of, connected with, related to or incidental to this MSA to the fullest extent permitted by law.
12.7. Force Majeure. Neither party shall be liable to the other for any and all losses, damages,
costs, charges, attorney fees, payments, expenses or liability due to delay or interruption in performing its
obligations hereunder, and without the fault or negligence of such party, due to causes or conditions beyond
its control, including, without limitation, labor disputes, riots, war and war -like operations including acts of
terrorism, explosions, sabotage, civil disturbance, governmental restriction, transportation problems, failure
of power or other utilities including phones, internet disruptions, fire or other casualty, natural disasters,
City I y oUflcl — 19 - 12 9/19/2023
epidemics, pandemics, acts of God, disruptions in orderly trading on any relevant exchange or market, or
any other cause that is beyond the reasonable control of either party.
12.8. Severability. The provisions of this MSA are severable, and if for any reason a clause,
sentence, paragraph or provision of this MSA is determined to be invalid by a court or federal or state
agency, board or commission having jurisdiction over the subject matter thereof, such invalidity will not
affect other provisions of this MSA that can be given effect without the invalid provision.
12.9. Notices. All formal notices required by this MSA will be in writing and shall be sent to
Empower as set forth below and to the most current Plan Sponsor and trustee address on file with
Empower. All notices sent shall be effective upon receipt.
Notice To Empower:
Empower
8515 East Orchard Road
Greenwood Village, CO 80111
Attn: Market Segment Head
With a copy to:
Empower
8515 East Orchard Road
Greenwood Village, CO 80111
Attn: General Counsel
12.10. Headings; Defined Terms; Counterparts. Section headings used in this MSA are
intended for reference purposes only and shall not affect the interpretation of this MSA. Unless the context
requires otherwise, capitalized terms defined in this MSA have the meanings set forth herein for all
purposes of this MSA, including any Schedules or Exhibits. This MSA may be executed in counterparts,
each of which shall be deemed an original, but all of which together shall constitute one and the same
agreement. The parties' execution and delivery of this MSA by facsimile, email, or electronic copies shall
have the same force and effect as execution and delivery of an original.
12.11. No Tax or Legal Advice. Nothing in this MSA is intended to constitute legal or tax advice
from Empower to Plan Sponsor, or to any other party. Plan Sponsor understands that Empower has not
given and may not give legal advice. All issues should be reviewed and discussed with Plan Sponsor's
legal counsel and/or tax adviser.
12.12. Survival. The provisions of the following sections shall survive the termination of this
MSA: Fees & Charges; Confidentiality; Data Protection; Record Retention; Intellectual Property Rights;
Indemnification; Limitation of Liability; Dispute Resolution; Governing Law; Waiver of Jury Trial; Survival;
Severability; Transition Assistance Services; No Tax or Legal Advice; No Third -Party Beneficiaries; and
any other section that would by its context be reasonably expected to survive termination.
12.13. Signatures/Corporate Authenticity. By signing this MSA, the parties certify that they
have read and understood It, that they agree to be bound by its terms, and that they have the authority to
sign it. This MSA is not binding on either party until signed by both parties.
City i y ounCI - 19 —13 9/19/2023
12.14. Electronic Signatures. Each party agrees that this MSA and any other documents to be
delivered in connection herewith may be electronically signed, and that any electronic signatures
reasonably believed to be genuine on this MSA or such other documents are the same as handwritten
signatures for the purposes of validity, enforceability, and admissibility.
[Signature Page Follows]
City Y ounce — 19 --14 9/19/2023
A-2023-164
By signing this MSA, the parties certify that they agree to be bound by its terms and ifs to be executed by
their respective duly authorized officers as of the Effective Date.
Empower Annuity Insurance Company
Signature
Daniel A. Morrison
Printed Name
Senior Vice President, Government Markets
Title
8/30/2023
Date Signed
City of Santa Ana
Signature
Printed Name v —
Cky A09
Titles
In l z-*3
Date Signe
ISM
L� Z
r nit
APPROVED AS TO FORM:
SONIA R. CARVALHO
Ity Attorneyn� (/�
awia— k lU®y11 yu
Laura A. Rossini
Chief Assistant City Attorney
FOR APPROVAL:
Kathryn Downs
Executive Director of Finance
city 16, ry, U outtcl - 19 —15 9/19/2023
EXHIBIT 1:
DATA SECURITY & PRIVACY ADDENDUM
This Data Security & Privacy Addendum applies to Empower and its Affiliates and describes how Empower
protects Personal Data and Plan Data (the "Addendum"). Capitalized terms used but not defined herein
have the meanings given to them in the Master Service Agreement executed by Empower and Plan
Sponsor under which Empower provides services to Plan Sponsor ("Agreement"),
1. Definitions. The following terms have the meanings set out below and similar terms shall be
construed accordingly:
"Data" means Personal Data and Plan Data.
"Data Protection Laws" means any law with respect to the protection of Personal Data that is
applicable to Empower's Services under the Agreement or any Schedule thereto.
"Information Security Breach" means a confirmed compromise of an information system within
the authority or responsibility of Empower that results in: (i) the unauthorized acquisition, disclosure,
modification or use of unencrypted Personal Data, or encrypted Personal Data where the encryption key
has also been compromised; and (ii) a reasonable likelihood of identity theft or fraud against a data subject
in the Plan. An Information Security Breach includes, without limitation, theft andfor malicious use of Data
by Empower personnel. A good faith but unauthorized or unintentional acquisition, disclosure, modification
or use of Personal Data by an employee or contractor of Empower or a party who has signed a
confidentiality agreement with Empower does not constitute a Security Breach if the Personal Data is not
subject to further unauthorized acquisition, disclosure, loss, modification, or use.
"Personal Data" shall mean information that identifies or is reasonably capable of being associated
with a Participant in the Plan or an eligible employee of Plan Sponsor and includes personally identifiable
financial information as defined by Title V of the Gramm-Leach-Bllley Act, but excluding data that is publicly -
available and data from which individual identities have been removed and that is not linked or reasonably
linkable to any individual.
"Plan Data" shall mean non-public Plan level information that is provided to Empower in
connection with receipt of the Services. Plan Data excludes data that is de -identified and aggregated for
benchmarking and research purposes.
"Subprocessor" means any person (including any third party service provider and any Empower
Affiliate, but excluding personnel employed by such parties) engaged by Empower to process Personal
Data.
2. Direction. Plan Sponsor Directs Empower and its Affiliates (and authorizes Empower and its
Affiliates to Direct each Subprocessor), where applicable, to process Personal Data as follows: (a)
processing in accordance with the Master Agreement and any amendments thereto as executed by the
parties; and (b) processing initiated by Participants in their use of the Services. Plan Sponsor represents
that it is and covenants that it will at all relevant times remain duly and effectively authorized to give the
Direction set out herein.
3. Security. In order to protect Personal Data, Empower will implement appropriate technical and
organizational measures designed to protect Personal Data in accordance with the requirements of any
Data Protection Laws. In addition to the foregoing, Empower's security program shall conform to the
commitments described below.
city I y otfncl - 19 — 16 9/19/2023
4. CCPA Compliance. Each Party hereto agrees and certifies that such Party complies with all
applicable sections of the California Consumer Privacy Act of 2018 and its implementing regulations, as
amended or superseded (the "CCPA"), in connection with this Agreement. Empower will notify Plan
Sponsor in the event it determines that it is no longer able meet its obligations under the CCPA.
4.1 Empower processes Personal Data to provide the Services under the Agreement for the
following purposes: to maintain or service retirement accounts, provide participant service, education and
support, to offer financial wellness programs to participants, to maintain online participant accounts, to
provide call center services, to respond to inquiries, to provide benchmarking services to Plan Sponsor,
and additional specific services as further described in Schedule A-1 (collectively, the "Business
Purpose").
4.2 Except as otherwise permitted by the CCPA, Empower will use, disclose, and retain
Personal Data solely for the Business Purpose and will not use, disclose, or retain Personal Data for
commercial purposes other than for the Business Purpose. Except as otherwise permitted under the CCPA,
Empower will not use, disclose, or retain Personal Data processed in connection with the Services outside
the direct business relationship with Plan Sponsor nor combine personal information that it received from,
or on behalf of, Plan Sponsor with personal information that it received from another source or collected
from its own interaction with the consumer, except as required to provide the Business Purpose or as
otherwise permitted by applicable laws.
4.3 Empower will not sell or share Personal Data in any manner in violation of the CCPA.
4.4 Upon priorwritten notice to Empower, Plan Sponsor may take reasonable and appropriate
steps to (i) ensure Empower uses the Personal Data collected is in a manner that complies with the CCPA
and (ii) stop and remediate any unauthorized use of Personal Data by Empower.
4.5 Empower shall enable the Plan Sponsor to comply with consumer requests made pursuant
to the CCPA to the extent compliance with such requests is required by the CCPA.
4.6 In the event the CCPA is pre-empted by Federal laws, the terms of this Section 4 shall no
longer be applicable, and upon the request of either party hereto, the parties shall cooperate in good faith
to reasonably amend or modify these terms to address future changes to Data Protection Laws that require
such amendments.
4.7 Empower shall implement security practices and procedures appropriate to the nature of
the Personal Information as set forth herein.
5. Subprocessing. Plan Sponsor hereby agrees that Empower may engage its Affiliates and third
parties as Subprocessor in connection with the provision of Services under the Agreement. Empower shall
carry out reasonable due diligence as appropriate to the nature of each Subprocessor's services to ensure
that the Subprocessor can provide the level of protection for Personal Data required by this Program. Upon
request, Empower shall make available a current list of any material Subprocessors that have access to
Personal Data; the parties hereto agree that such list is the Confidential Information of Empower and subject
to the confidentiality provisions of the Agreement.
6. Data Subject Rights. In the event that Empower receives a request from a Participant relating to
an exercise by the Participant of the Participant's rights under applicable Data Protection Laws (such as a
"right to know" or "right to delete" request), Empower will Direct such Participant to take the request to the
Plan Sponsor. Empower will cooperate with any request by the Plan Sponsor to respond to requests to the
extent required by applicable Data Protection Laws.
City Y ounce - 19 -17 9/19/2023
7. Data Security. Empower's Information Security Policies and related policies address the
management of information security, the security controls employed by the organization. These policies
include, without limitation:
7.1 An Information Security Board that is responsible for the development, implementation,
and ongoing maintenance of Empower's data security.
7.2 Documented policies ("Information Security Policies") that Empower formally approves,
internally publishes, communicates to appropriate personnel and reviews at least annually. Empower's
Information Security Policies shall (i) mandate the secure protection and handling of confidential data, (ii)
comply with applicable laws, (Ili) conform to or exceed applicable industry standards for the retirement plan
services industry, and (iv) documented, clear assignment of responsibility and authority for data security -
related activities.
7.3 Policies covering acceptable computer use, record retention/destruction, information
.classification, cryptographic controls, access control, network security, removable media, remote access,
mobile computing and wireless access.
7.4 Regular testing of the key controls, systems and procedures, including (i) testing of
information technology general controls (ITGC) at least annually or whenever there is a material change in
business practices, and (ii) infrastructure penetration tests and scans against internet-facing points of
presence. Empower will correct vulnerabilities or security issues discovered through such assessments in
a manner and time frame consistent with established standards.
7.5 Policies and procedures designed to protect the security of Plan Data and Personal Data
that is accessible to, or held by, Empower's third party suppliers. Such policies shall be based on Empower's
Information Security Policies, and shall address, as applicable: (1) the identification and risk assessment of
such supplier; (ii) minimum cybersecurity standards required to be met by such suppliers; (Ili) due diligence
processes used to evaluate the adequacy of cybersecurity practices of such suppliers; and (iv) periodic
assessment of such suppliers based on the risk they present and the continued adequacy of their
cybersecurity practices.
7.6 Use of appropriate administrative, technical and operational measures designed to ensure
Personal Data and Plan Data is secure.
7.7 Monitoring, evaluating and adjusting, as appropriate, its data security protocols
summarized herein, In light of relevant changes in Data Protection Laws, Services, technology or industry
security standards, the sensitivity of data collected orprocessed by Empower in the provision of its Services,
and evolving internal or external risks. Empower may make such updates to its data security protocols and
the terms hereof at any time without notice so long as such updates maintain a comparable or better level
of security. Individual measures may be replaced by new measures that serve the same purpose without
diminishing the security level protecting Personal Data or Plan Data.
8. Risk Management. Empower has a risk assessment program that includes regular risk
assessments and management for risk identification, analysis, monitoring and reporting.
9. Human Resources.
9.1 Acknowledgements. Empower shall provide training on its information security practices
to its personnel at least annually. Empower personnel shall acknowledge their information security and
privacy responsibilities under Empower's policies.
city IF, y otmci - 19 — 18 9/19/2023
9.2 Personnel Controls. Empower completes appropriate pre -employment background
checks and screening on its personnel, and requires personnel to complete initial security training at the
time they are first employed with Empower and annually thereafter. All personnel attest annually to
Empower's Code of Business Conduct and Ethics, which enforces the tenets of Empower's Information
Security Policies and its privacy policies. Empower has disciplinary processes for violations of information
security or privacy requirements, and promptly removes personnel access to Plan Data or Personal Data
upon termination or applicable role change.
10. Physical and Environmental Safety.
10.1 Physical and Environmental Security Controls. Empower has appropriate physical and
environmental controls to protect Empower's equipment, assets, and facilities used to provision services.
Physical Security includes, without limitation (i) physical security in the protection of valuable information
assets of the business enterprise; and (ii) the provision of protection techniques for the entire facility, from
the outside perimeter to the inside office space, including the datacenters and wiring closets.
10.2 Ongoing Operations. Empower protects its facilities and systems containing Data from
failures of power, networks, telecommunications, water supply, sewage, heating, ventilation, and air-
conditioning.
11. Communications and Operations Management.
11.1 Controls. Empower has policies and procedures in place for communications and
operations management controls. Such controls address: hardening, change control, segregation of duties,
separation of development and production environments, network security, virus protection, patch
management, media controls, data in transit, encryption, audit logs, and time synchronization.
11.2 Operations Security. Empower's Information Security Policies mandate ongoing
Operations Security requirements, including but not limited to, installing or maintaining (i) security patches
for operating systems and applications within standard timeframes based on severity; (ii) industry standard
versions of operating systems, software and firmware for system applications and components; and (Ili) up--
to-date system security agent software which includes updated malware and virus definitions.
12. Access Control
12.1 Access Control. Empower utilizes access controls designed to ensure that only Empower
personnel with the proper need and authority can access its internal recordkeeping system and associated
data. Empower's access controls include but are not limited to: limiting access to personnel with a
requirement to view Personal Data; establishing least -privilege controls to protect systems and Personal
Data; generation of audit trails; periodic review and approval of personnel who need to access the Empower
recordkeeping system; and termination of personnel access promptly following severance from
employment.
12.2 Authentication. Empower authenticates user identity through appropriate authentication
controls such as strong passwords, token devices, or biometrics. Passwords must meet minimum length
and complexity requirements.
12.3 Remote Access to Empower Systems. Empower uses multi -factor authentication for
remote access to its systems.
13. Information Systems Acquisition, Development and Maintenance.
City i y oUPlcl ' - 19 - 19 9/19/2023
13.1 Systems Development Security. Empower addresses security as part of information
systems development and operations and follows secure coding methodologies based on application
development security best practices.
13.2 Software Security Management. Empower's information systems (including operating,
systems, infrastructure, business applications, off -the -shelf products, services and user -developed
applications) adheres to the information security standards set forth in Empower's Information Security
Policies.
13.3 Vulnerability Assessments/Ethical Hacking. Empower performs vulnerability
assessments and penetration testing against Internet -facing points of presence. Empower corrects
vulnerabilities or security issues discovered through such assessments in a manner and time frame
consistent with established standards set forth in Empower's Information Security Policies.
13.4 Cryptography. Empower uses cryptography techniques that assist Empower with
preventing the unauthorized capture, modification of or access to data or information. Empower uses
standard encryption algorithms that follow up-to-date encryption standards and industry practices. Such
cryptography techniques may include but are not limited to: encryption of sensitive data sent across external
communication lines; requirement of minimum 128-bit encryption TLS encryption for web browsers; and
encryption of Personal Data while stored on laptops, mobile devices, and in recordkeeping databases.
14, Information Security Breach Management.
14.1 Incident Management Program. Empower maintains investigative measures and
techniques for incident handling, including but not, limited to: a formalized, enterprise -wide Computer
Security Incident Response Team ("CSIRT"), and CSIRT processes which are tested at least annually.
14.2 Information Security Breach Response. Empower will notify Plan Sponsor after
becoming aware of any Information Security Breach in accordance with all applicable Data Protection Laws.
For the avoidance of doubt, Empower will (1) keep the Plan Sponsor informed of significant developments
in connection with the investigation of such incident; (ii) investigate and assist any regulator or other
governmental body with oversight over the Information Security Breach in investigating, remedying and
taking any other action regarding the Information Security Breach as appropriate or required by law; and
(III) provide Plan Sponsor with information about remedial measures that have been undertaken to prevent
such Information Security Breach from reoccurring. In the event that Individual or regulatory notifications
are required under applicable Data Protection Laws, the parties will cooperate with respect to notifications.
To the extent the Information Security Breach is caused by Empower's failure to abide by its obligations as
set forth in this Data Security Addendum, Empower shall bear the costs of such notifications and provision
of credit monitoring services to affected individuals to the extent required by law or otherwise appropriate
in Plan Sponsor's and Empower's reasonable judgment.
15. Plan Sponsor Assessment Rights.
15.1 Assessment via Security Assurance Package. Within the secure Plan Sponsor website
provided by Empower, Empower provides documentation that supports and informs the reader about
Empower's current security program and practices. These documents are referred to as the Security
Assurance Package ("SAP"), which currently consists of the following Items: Security Program Overview
document, SOC 1 report, SOC 2 report, available IT certification reports (e.g. Verizon CRP), and a
completed SIG questionnaire with related supporting materials. (The SIG is a standardized document
template created by the Shared Assessments Program, a consortium of leading financial institutions, the
Big 4 accounting firms, and companies from a wide array of industries.)
15.2 Regulatory Assessment. If Plan Sponsor's governmental regulators require that Plan
Sponsor perform an on -site audit of Empower's network security, as supported by evidence provided by
City i Y ,ounce 19 — 20 9/19/2023
Plan Sponsor, Plan Sponsor may conduct an on -site audit of Empower's network security, relevant to the
security of Plan Data ("Regulatory Audit"). Unless a different notice or frequency is required by Plan
Sponsor's governmental regulators, a Regulatory Audit may be conducted by Plan Sponsor once per year
at a mutually agreed -upon time with at least 60 days' advance written notice to Empower. If a Regulatory
Audit requires the equivalent of more than two business days of Empower Personnel's time to support such
audit, Empower may charge Plan Sponsor's an audit fee at Empower's then -current rates for each day
thereafter.
15.3 Miscellaneous. This Addendum is governed by and incorporated into the Agreement. In
the event of any conflict between the Agreement and this Addendum, the Agreement will prevail. Any
capitalized terms used but not otherwise defined herein shall have the meaning set forth in the Agreement.
City I y UOYCII 19 — 21 9/19/2023
EXHIBIT 2:
PROCEDURES FOR COMPLYING WITH FUND COMPANY MARKET TIMING AND EXCESSIVE
TRADING
This Exhibit 2 shall apply to any Recordlweping Services Schedule under the Master Services Agreement
PROCEDURES FOR COMPLYING WITH FUND COMPANY MARKET TIMING AND EXCESSIVE
TRADING POLICIES
The prospectuses, policies andlor procedures ofcertein fund companies require retirement plan providers
offering theirfund(s)fo agree to restrict marketti ring andlor excessive trading Cpfolribited trading"') in their
funds. The following procedures describe how we will campy with fund company instructions designed to
prevent or rninim¢e prohituled trading.
Various fund companies instruct intermediaries to perform standardized trade monitoring while others
perform their own periodic monkming and request trading reports when they suspect that an individual is
engaging in prohibited trading. Ifan individuars trading activity is determinedto constitute prohibited trading,
as defined by the applicable fund company, the Individual will be notified that a trading restriction will, be
implemented if probilbited trading does rot cease. (SvDme funds may require that trading restrictions be
implemented immediately w8hout warning, in which case notice of the restriction vill be provided k) the
individual and plan, If applicable). If the individual continues to engage in prohibited trading, the individual
will tie restricted from maldrg transfers into the Identified fund(s) for a specified time period, as determined
by the applicable fund euxnpany. Individuals are always permitted to make transfers out of the identified
find(%) to other available investment options_ When the fund company's restriction period has been met,
the individual will automatically be alkywed to resume transfers into the identified fund(s).
Additionally, IF prohibited trading persists, the fund company may reject all trades initiated by the plan,
Including trades of individuals who have not ongaged in prohMed trading.
Nate: certain per sponsors have or may elect to implement plan level restrictions tD prevent or minimize
individual prohibited trading. Tothe extent that such procedures am effective, we may not receive requests
for information flan: the fund companies or requests to implement the restrictions described above.
U712422
City IF, PY ounCl - 19 - 22 9/19/2023
EXHIBIT 3: PRIVACY NOTICE
PRIVACY NOTICE
E
EMPOWER
r
FACTS whatdoesE q)a Retirement. LLC(Empbwa)dowith your personalnfbrnnation?
Fnantial GdlrpatieS Chawo hdvt*SlweyOurpa'natal irifamatidl. Federal L3wgivesmnSumors the ,
WHY? ronvo limit same Gut na all sharing Federal law atsbrequirea uS wwll ywhew we Mile%share and
prarectymr personal information. Please read this nbdw Caefully to unferstarrd whatwe do,
Thetypes of pWw;l inFarrauon wo wilaa and share depend w the produu or service you have with in. Ir
This wormatibn dw include:
Satin 5ar_urity number and at[Wnt balances
WHAT? Retirement assets aAd trarewbtn hstory.
EtlployWtiniftrmatiW andnmmo-
Whw you are no lo"ev bur Custaner, we cen6we to glareyaur Woemmim ae dow bcn in W is notibe
All firvantal companies need to share customers' personal information to runtheir everyday business. In the
HOW? SaCtian below.. we, list the ea&t is financial Companies tan Mom thole a+gtamov personal iA bmnatibn, the
reasons Emlwwer chooses to share and whether you Can limit this sharirrg.
REASONS WE CAN SHARE YOUR QOE5 EMPOWER CAN YOU UNIT
PERSONAL INFORMATION sNARi:% THISSHARINGt
For ou r ev"Vday business purposes —
such as to procmyour vansacuon5, maintain your aawnt(4
respd to court orders and IegA MUPst. at"s. or eepbrt ter 1"e5 N❑
b
credit b Aaiun
For auk markethig purposes —
to atfer our products and services to you Yes No
For joint marketing With otherfinancial companies No We font share
For dur affiliates' everydaybushress purposes —
nformaron about your transactions and expaerienws ye° No
For our aMllates' everyday business purposes— .
Nb We Obrl't sharer
in brmatibn atUl your CreditWOr(Nl -SS Y
For nuroffiliates to market to you No We dbnt stare
r
QLE YI9N5# iC491to4fiee atgS5-756-4738 orgotoempowerxerrYprivacy
20
City Council 19 — 23 9/19/2023
-01111111i.,
EMPOWER
WNO WE ME
Who Isding
this notim?
aHrx3
� �ik pYONdad at E and its afli lanes_ A list of cpm nesthe end of d'ns rimite.
WHAT WE 110
Haw dries fmpower
To protect your pn_rsdrtat informaalnn kom tnauthceited access and use, we usesecurtty
i pmtect my personal
measures that comply wrth federal law. These measures include plhonl,technleal am
infortnadun7
pr*eedural:afegw•ds, such W bAlre and system Security and personnel donor&
We collect your peesrrnal mforma tion, for eamplp, when you:
• Pirmlde acmurx nformmion or apply for a lean.
How does Empower
collectatlrs peonal
yitg iMa an irne5tfnenC adYYSory mnlradf ar Soek adrineanatll your aTYeStmMCS_
rr
Tell us abort your invesemart or retirement portfdia.
We also Collett your pefsonal information from ot}ier& such as credit bureaus. evil sites or
other Companies_
1
Federal law g'Ne5 you the right to lanit only:
• $haring fcrafRliates'eteryday business purpmos— information about
Why cantl Unfit
your ceikmworthin—m.
all shadnW.
Affilliates from using your information to market to you
• Shaer for rronaffiliate,s to market to you
5 ate laws and imlvidual companies may give you additional r[gnt5to limit snaring
j 8fF71f1111#lN,+'
1
4ompanie5 related t [iltlVilpn ownership nr CrkHe01 hey LAY be financial am
raonfnandal romgiA ess
Afflial
t)w affAcFh?5 RhOAlP Cf n1pWe'£wrilh the CilippM(r; Grant West L*A AnAirry or C"-WpSr
urornes, asw^r risPYtaw, arraotrrrr�5„anoe!rorr{oarn4ps szrtn as,re r.LatC uff
&Td CWIA.
Companiosno[ rFyated by G]mman pwitersfiip ar Lonrtrot That' ran be finanoai and
Norwi lutes
Mnfna oal Lompafnes.
• Empower does rot 4'iore rM'h man0 Srt ti>4yLAn market m you.
A formal agmement hetwecn nonafflixad firwwoAl nompanles that tagerher market
Joint marketing
flnWxial prodk rs or Services to you
• RpAcwFr Y9n!srYtloiratfytaWiet
WHO IS PROVl61NG THIS NOTICE?
Empower R2He4MefX LtC: Grrpxt WCsk the S AnnAty nsarrunce CCmpaYy:'T�'e Grea[-yP;st iKe ASAranCC Canparyd iS.
aperat*ML Great-4Me5t Life & Mtln/lty kanrance Compaq Of New yedc Great -West FinameW RCtleemeM plan 5"VkeS
LLQ AdYlsed Assets Group, LLC 5WIF5 Fg4lltre5, inr,The Canada tife Assurance Company 1115. operariorij, feral"West Life
& Annuity Insurance Company of South Cardinx Groom -West Ca Mal Manag-mert LLC. GreatWestFunds, Inc; Great: West
Treat Company, LLC; PY'udantial Retiientatt[ IriSttrdnce aM MtW Ry Company- FrudeMiai Bank C4 Tru>`(. F58; Global Wrtiolio
$aaeQ�ja.S, Im[_; TBG IiKuraiKe SETui[ns Crxprnarian; MC Insurance, Agency ServiLes LLC; MullUt T8G Ir154CanteAgen(y
9M>iCet, LLL: and CGIA05A RUT Corp.
CiNFLY-Wy-t$31Y20-n62?
21
City Council 19 — 24 9/19/2023
EXHIBIT 4: BUSINESS CONTINUITY PLAN NOTICE
BUSINESS COMr41tUM PLAN NOTICE
Empower Financial Services, Inc. CEmpower"), a subsidiary of Empower Annuity Insurance Company
of America and affiliate of Famprmer Life & Annuity insurance Company of New York' and Empower
f`tetirement, LLC, maintains a comprehensive business continuity plan designed to respond reasonably
and effectively to event* that lead to significant business disruption, such as natural disasters., powac
outages, or other awards of varying Scope. This plan defines critical functions and systems, alternate work
locations, vital books and records, end staff resources, and provides for the continuation of business
pperadone with :minimal impact, depehdlog on the severity and sow of the etiaruptian. "Tire plan Is
reviewed and tested he leas than curse annually to ensure that the informntion in the plan is kept current
and that documented recovery and confinuiity strategies adequately support its business operations. Of
utmost importance to the plan is the ability for customers to maintain access to securities accounts and
assets in those accounts.
In the event that tote of tie oontalet centers fir beck ofte opsration facilifi s becomes unavailable for
any reason, calls would be re-routed to one of the firms alternative contact center or operations facflifies.
In the event of a significand business disruption to the primary office andfor date center, access to customer
accounts wi0 be provided via the Comptsry's Web alto and volts response system, operated from an
alternative data carder. Customer service will continue to be provided by fe routing telephone calls to a
contact corder lucatcrd in one or mm alternative site* located outside of the region. Secure walk from
home solutions are avaiable forall staff.
While no contingency plan tan eliminate fore risk of business interruption, or prevent temporary delays with
account access, the Irm"s continuity ON is intended to mitigate all reasonable risk wW resume "oaf
business operatons within 24 hours or Fire next business day, whichever is later.
Record keeping and administrative services are provided by Empower Retirement, LLC, and in. New
York, Empower Life 6 Annuity insurance Company of New York, or one of its subsklsari s or aMifates.
.Securities ofFered in year account may be offered through another broker/dealer Scar other than
Empower Financial Services, Inc., a wholly, owned subsidiary of Empower Annuity Insurance Company
oaf Ametica. Please contact y qrr inve*[menf poi y r tut more krFamtal on IF needed -
This disclosure is subject to modification at any time. The most current version of this cha sure can be
found on ft, If* Company's website or can bo obtained by requesting a written copy by mall.
BC P — Empower Customer Notice (Ed. August 2022)
22
City Council 19 — 25 9/19/2023
SCHEDULE A-1:
RECORDKEEPING SERVICES & FEE SCHEDULE
forthe
LIST OF PLANS
City of Santa Ana Deferred Compensation Plan ("457(b) Plan")
Empower Group Account Number: 960140
GENERAL
This Recordkeeping Services Schedule ("Schedule") is a separate agreement between the parties
hereto and incorporates the terms and conditions of the MSA ("Agreement") between Empower Annuity
Insurance Company and Plan Sponsor. All references to "Empower" in this Schedule are deemed to be "
references to Empower or the Empower Affiliate, as the case may be, that enters into this Schedule.
Capitalized terms used but not defined herein shall have the meanings given to them in the Agreement.
Any conflict between this Schedule and the terms of the Agreement shall be resolved in favor of the
Agreement, unless this Schedule specifically states that its provision will prevail.
2. SCHEDULE TERM
2.1. The Effective Date of this Schedule is October 1, 2023 ("Schedule Effective Date"), or
such later date as it has been signed by both Plan Sponsor and Empower. The term of this Schedule is for
a period of three (3) years, from October 1, 2023 through September 30, 2026. The City may, at its
discretion, extend the agreement with the same or more limited scope of required services for one (1)
additional two (2) year period, upon mutual agreement contingent upon City Council approval, or City
Manager or City Attorney authorization, as appropriate unless terminated in accordance with Section 11
[Term & Termination] of the Agreement. The total term of the awarded agreement shall not exceed five (5)
years. The termination of this Schedule shall also operate as a termination of all Schedules to the
Agreement.
2.2. Upon termination, Plan Sponsor Directs Empower to deduct any and all outstanding
expenses and fees owed to Empower from the Plan's trust on the termination date, unless paid by the Plan
Sponsor. Plan Sponsor agrees to amend the Plan, if necessary, to provide for the payment of expenses
from the Plan consistent with the foregoing. Upon termination of this Schedule, Empower will cease to
provide the Services herein. Plan Sponsor acknowledges that after the termination of this Schedule, Plan
Sponsor will be responsible for performing all actions required to be taken with respect to the Plan including,
but not limited to: processing of contributions, loans and distributions, and the distribution of forms to
Participants. On and after the actual date of termination of this Schedule, Empower shall have no further
obligations hereunder except as set forth in Section 12 [Transition Assistance Services].
NATURE OF EMPOWER'S SERVICES
23
City Council 19 — 26 9/19/2023
3.1 Services. Empower will provide the Services set forth in this Schedule or as further
described in the Exhibits attached hereto. Empower will perform the Services in accordance with the
Performance Standards Exhibit as attached hereto.
3.2 Fiduciary Status. Except with respect to any Services for which Empower has specifically
agreed to act as a fiduciary under this Schedule, Plan Sponsor acknowledges that (i) Empower acts as a
non -discretionary service provider Directed by the Plan Sponsor or other Plan fiduciary and, as authorized
by the Plan Sponsor, by Participants; and (ii) performance of the Services do not involve the exercise of
any discretion in the administration or management of the Plan that would cause Empower to be a fiduciary
or a Plan Administrator as defined under the Code, ERISA, the Investment Advisors Act of 1940, or state
law, as applicable. The Plan Sponsor has appointed a Plan Administrator that has discretionary authority
for the administration and management of the Plan. The parties agree that Empower will not perform a
Service that could cause it to have discretionary authority or responsibility for the administration or
management of the Plan or disposition of Plan assets. Empower shall not render, or have any authority or
responsibility to render, investment advice for a fee or other compensation, direct or indirect, with respect
to any Plan assets, except as specifically provided for under this Agreement.
4 PLAN SPONSOR RESPONSIBILITIES
Plan Sponsor acknowledges that Empower cannot effectively perform the Services without Plan Sponsor's
cooperation. Accordingly, Plan Sponsor acknowledges and agrees that it will fulfill the following duties and
obligations:
4.1 Provision of Information. Plan Sponsor or its designee, including any third parties
retained by or, on behalf of the Plan or Plan Sponsor, will provide all information necessary for Empower to
perform the Services in a manner and format that does not require manual intervention or manipulation by
Empower. Plan Sponsor acknowledges and agrees that Empower shall not bear any responsibility for any
penalties or other costs incurred as a result of Plan Sponsor's failure to provide such information in a timely
manner. Plan Sponsor further acknowledges and agrees that Empower may charge an additional fee if
any necessary information is not provided on a timely basis, or in an electronic format usable by Empower
without any manual intervention or manipulation. Plan Sponsor agrees that Empower shall be entitled to
fully rely upon the accuracy and completeness of information Plan Sponsor submits and that Empower shall
have no duty or responsibility to verify such information. If, as a result of incorrect or incomplete information
furnished by Plan Sponsor, it becomes necessary to repeat any calculation or service, complete any new
forms or revise any completed forms, Empower reserves the right to charge an additional fee. Each party
agrees to bear its own transmission costs and is solely responsible for its own acts and omissions relating
to transmitting, receiving, storing and handling documents and information, including the maintenance of
all equipment, software and testing necessary to effectively, reliably and securely send and receive such
documents and information.
4.2 Remitting Contributions and Allocation Instructions. Plan Sponsor agrees that it is
solely responsible for collecting and remitting all initial and recurring contributions and loan repayments to
Empower electronically via Empower's plan sponsor website, or another mutually agreed -upon manner
within the time prescribed by applicable law. Plan Sponsor acknowledges that. Empower is not responsible
for monitoring the amount and/or timeliness of such contributions and loan repayments.
4.3 Plan Document Responsibilities. Plan Sponsor has the responsibility to ensure that the
Plan documents are accurate and complete, to interpret Plan terms and to review the Plan document
services provided by Empower, if any. Plan Sponsor is responsible to ensure that the Plan is being operated
24
City Council 19 — 27 9/19/2023
in accordance with its terms. Plan Sponsor shall provide Empower with a signed copy of the Plan document
and all amendments to the Plan document within thirty (30) days after such document and/or amendment
is adopted.
4.4 Investment Options.. Plan Sponsor is responsible for the selection of all Investment
Options based on Plan Sponsor's independent evaluation, or that of its registered investment advisor,
consultant, broker or other agent, as applicable. Plan Sponsor must notify Empower in writing of the
Investment Options including benchmarks, if applicable, intended to be serviced by Empower and such
Investment Option services including benchmarks, if applicable, are only provided as agreed upon by
Empower and may be subject to certain limitations or conditions. Plan Sponsor acknowledges that
Empower or its Affiliates may receive fees from mutual fund families or other Investment Option Sponsors
or their Affiliates for providing certain administrative or other services thereto ("Fund Service Fees") in
connection with the Plan. Plan Sponsor may request additional information regarding such fees at any time.
If the provider of an Investment Option causes an Investment Option to become unavailable to the Plan,
Empower will notify Plan Sponsor as soon as practicable after the Investment Option Sponsor notifies
Empower.
4.5 Plan Sponsor Acknowledgment of Market Timing Procedures. Plan Sponsor
acknowledges that the SEC requires mutual fund companies to establish procedures to prevent market
timing and excessive trading. Plan Sponsor acknowledges receipt of, and agrees to adhere to, the terms
and conditions of the Procedures for Complying with Fund Company Market Timing and Excessive Trading
Policy attached as an Exhibit to the Agreement, as amended from time to time.
4.6 Payment of Plan Expenses. Plan Sponsor may Direct Empower in writing to deduct Plan
expenses from the Plan to the extent Plan Sponsor has determined that deduction is specifically allowed
by the Plan document and applicable law, and to remit to the party designated by the Plan Sponsor.
4.7 Plan Sponsor Direction to Perform the Services. In performing the Services, Empower
is acting at the Direction of the Plan Sponsor or other fiduciary of the Plan by following the procedures set
forth in a plan administration guide or similar procedural document provided by Empower to the Plan
Sponsor, including by posting such procedural documents to the Plan Sponsor website. To the extent the
procedures do not fully address a specific issue, the Plan Sponsor agrees to provide Direction in a manner
reasonably requested by Empower, and Empower may rely upon any such Direction by a person that
Empower reasonably believes to be authorized to act on behalf of the Plan Sponsor or other fiduciary. Plan
Sponsor specifically intends that Empower will have no discretionary authority with respect to following such
Direction.
4.8 Electronic Delivery
4.8.1 Empower will deliver plan -related documents to Participants under the Agreement
In an electronic manner as described below.
4.8.1.1 Plan notices to be delivered by Empower via an email notice of the
availability of the plan -related documents on the Participant website will be sent to an email address
provided to Empower by the Participant or by Plan Sponsor. If Empower is not provided with an email
address, notices will be delivered to the Participant via regular mail,
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4.8.1.2 Empower will send an initial notification of default electronic delivery via
regular mail to each Participant at least 10 days prior to delivering any plan -related documents via email.
The initial notice of default electronic delivery will include the participant's email address that will be used
to deliver notices of the availability of plan -related documents, a statement of the Participant's right to
request and obtain a paper version of the documents and a statement of the option to opt out of electronic
delivery and receive only paper versions of the documents.
4.8.1.3 If an email notice of availability of a plan -related document is returned
undeliverable, Empower will send the notice to another email on file for the Participant. If no other email is
on file for the Participant or such other email is also returned undeliverable, plan related documents will be
delivered via regular mail to the Participant until such time as Empower is provided another email address
for the Participant.
4.8.1.4 Participants may request to receive one paper copy of a plan -related
document for no cost. in addition, Participants may opt out of electronic delivery and request that their plan -
related documents be delivered via regular mail at any time.
4.9 Review of Reports. Plan Sponsor is responsible for reviewing and monitoring reports
made available by Empower (whether provided electronically, by posting on an Empower, website, or
otherwise) regarding Plan activity, transactions and investments to verify that the transactions indicated in
the reports properly reflect the Direction provided by the Plan Sponsor. Empower's performance of its
obligations under this Agreement shall be presumed to be accurate unless Plan Sponsor provides Empower
with proper notice of discrepancies.
4.10 Error Correction.
4.10.1 Transactional Errors. If Empower does not accurately process contribution,
distribution, or investment instructions provided in good order by a Participant or the Plan Sponsor (e.g.,
Investment allocation of Plan contributions, investment exchanges or transfers, or timely processing of a
Plan distribution) and the issue is brought to Empower's attention within ninety (90) days from the
transaction confirmation, statement or other report issued by Empower following the error's occurrence,
Empower will, at its own expense, retroactively correct the Plan or Participant account to reflect its adjusted
financial position had the error not occurred, including any investment earnings and reduced by any
investment losses. If the issue is not timely brought to Empower's attention, Empower may correct the error
by adjusting the Plan or Participant account prospectively, Any such correction under this section 4.10.1
shall be subject to applicable law.
4.10.2 Plan Operational Errors. If Empower is timely notified that it has made an error
that creates an operational or fiduciary issue for the Plan, Empower will, within a reasonable time after
being notified of or discovering such error, notify the Plan Sponsor and describe the corrective option that
Empower proposes to employ that is consistent with the Internal Revenue Service, Department of Labor,
or other agency correction guidelines, where applicable, and Plan Sponsor shall review the proposed
correction option. Unless the Plan Sponsor objects to such proposed correction and requests an alternate
correction option within five (5) business days after receiving notice of Empower's suggested corrective
option, the Plan Sponsor Directs Empower to promptly process the correction in accordance with the
proposal, at Empower's expense. If Empower's proposed correction is consistent with Internal Revenue
Service, Department of Labor, other agency correction guidelines, or other guidance, but the Plan Sponsor
requests an alternate correction method resulting in expenses in excess of what Empower would have
incurred under its proposed correction, the Plan Sponsor shall bear such additional expenses (including
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without limitation any attorney's fees, regulatory filing costs and additional net loss resulting from such
method).
4.10.3 Trading Errors. If Empower does not accurately process a trade with the mutual
fund company as Directed by the Plan Sponsor or as instructed by a Participant, then Empower will correct
the share position at the mutual fund company as if the error had not occurred. In the event there are
multiple funds or related errors in one or more funds involved, Empower will net gains and losses across
all funds involved in the associated error(s). If the Plan Sponsor utilizes the services of a third -party trustee
and/or custodian ("Third -Party Trustee"), Empower shall in no event be required to perform any correction:
(i) for a trading error that results from an error or omission by the Third -Party Trustee, (ii) to be performed
under the terms of any service arrangements between the Plan Sponsor and such Third -Party Trustee (the
"Third -Party Trust Agreement"), (Ili) that falls within error tolerance ranges under the Third -Party Trust
Agreement, or (iv) that otherwise would exceed any requirements for error correction by the Third -Party
Trustee under the Third -Party Trust Agreement.
4.10.4 The parties acknowledge and agree that Empower will have no liability for an error
caused by acts or omissions of the Plan Sponsor, Participants or any other third party other than Empower's
Affiliates, agents, vendors and suppliers.
4.10.6 Duty to Mitigate. The parties acknowledge and agree that the Plan Sponsor, the
Plan Administrator and Participants each have a duty to mitigate any errors so as to minimize the expenses
that may be incurred to correct such errors by promptly reviewing transaction confirmations, account
statements and other Plan reports, as applicable, and providing notification of any error, providing tirnely
approval of correction measures and taking such other reasonable steps as may be necessary (e.g.,
proactively transferring account holdings into the appropriate Investment Option).
4.10.6 Transactional Gain/Loss Compensation Policies for Error Correction.
Empower may incur again or loss in the process of adjusting a Plan or Participant account to correct certain
errors due to changes in the share/unit price of an Investment Option between the original transaction date
and the correction date. The adjusted position of Plan and Participant accounts are not impacted by
transactional gains or losses incurred by Empower to settle the Investment Option positions in the course
of correcting the account. Empower will net any Investment Option pricing differences as part of the
correction process. If a correction is made at Empower's expense, Empower, not the Plan or Participant,
will incur any transactional loss and Empower will retain any transactional gain. _
4.11 Account Protection. Empower, Plan Sponsor or the Participant will promptly notify the
other parties if it discovers an unauthorized activity was made from the Participant's account. Empower will
conduct an investigation and take any appropriate steps, which may include working with law enforcement,
to determine the root cause of the unauthorized distribution. Plan Sponsor agrees to cooperate in any such
investigation and will comply with reasonable requests for information. To the extent Empower offers
Participants protection against account losses that result from unauthorized transactions, Empower will
restore losses as of the date of the account loss once Empower has had sufficient time to conduct a
preliminary investigation and attempt to ascertain the root cause. Such protection is not available if Plan
Sponsor refuses or neglects to follow commercially reasonable security practices, as set forth in Section
5.1 [Mutual Obligation to Protect Data] of the Agreement, or if the loss resulted from a compromise of the
systems or security protocols of Plan Sponsor or its third party service providers (other than Empower).
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5 PLAN INVESTMENT OPTIONS & FEES
5.1 Selection of Investment Options
5.1.1 The parties agree that the purchase and sale of securities for the Plan, except for
employer stock and unaffiliated self -directed brokerage, will be effected through Empower Financial
Services, Inc., a broker/dealer affiliate of Empower.
5.1.2 In addition to the sole responsibility for the selection of the Investment Options to
be made available under the Plan, Plan Sponsor will also Direct Empower to designate one of the
Investment Options available to be the default investment, in which any contribution or other amount
credited under the Plan for which neither the Participant nor the Plan Sponsor has provided Empower with
investment directions in good order will be invested ("Default Investment Fund"). Plan Sponsor may
designate a Default Investment Fund(s) for Participant contributions and also designate a second Default
Investment Fund for employer contributions.
5.1.3 Plan Sponsor Directs Empower and its Affiliates, as applicable, to cause all
dividends, capital gain distributions, interest or other earnings paid by an Investment Option under the Plan
to be reinvested in such Investment Option unless Directed otherwise by the Plan Sponsor and agreed to
by Empower.
5.2 Information Regarding Investment Options
Plan Sponsor Directs Empowerto obtain, or cause Its designee to obtain, all necessary information
(including but not limited to valuation, performance, prospectuses and other investment information)
regarding any Investment Option available under the Plan from any third parties representing such
Investment Options ("Investment Option Sponsor(s)"). Plan Sponsor acknowledges that prospectuses for
the Investment Options, as applicable, will be made available electronically through one or more websites
maintained by Empower or its Affiliates. In the event an Investment Option Sponsor does not provide all
necessary information and Empower agrees, Plan Sponsorwill arrange to provide Empoweror its designee,
or cause Empower or its designee to be provided, the necessary information regarding said Investment
Option. In no event will Empower be responsible for the accuracy of any such information provided to
Empower or its designee regarding any Investment Option, and Empower or Its designee will have no duty
or obligation to question, confirm or independently verify any such information.
5.3 Investment Option Changes.
5.3.1 Plan Sponsor may replace the Investment Options at any time, subject to
applicable notice requirements. Plan Sponsor will notify Empower in writing of any changes to such
Investment Options or the Default Investment Fund(s), and the parties will agree upon a process for
the transfer of assets and investment elections, if applicable, from prior Investment Options to new
Investment Options.
5.3.2 If any Investment Option is terminated by the investment Option Sponsor, and
Plan Sponsor wishes to replace the terminated option, Plan Sponsor agrees to replace the terminated
option with an available fund from any fund company that currently has, or will enter into, a trading
agreement with Empower.
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RECORDKEEPING AND ADMINISTRATION SERVICES & FEES
6.1 Basic Plan Administration Fee. Commencing on October 1, 2023, Empower will be
entitled to the following annual administration fee ("Basic Plan Administration Fee"). This fee is used, in
whole or in part, for administrative services provided by Empower as described in this Schedule. In addition,
some or all of the fee (or any other compensation, revenue, asset or source of funding available to
Empower, in Empower's sole discretion) may be used by Empower to make payments to the Plan under a
Plan Expense Account or similar arrangement, if applicable, between the Plan Sponsor and Empower. All
Services set forth in this Schedule are included in the Basic Plan Administration Fee unless an additional
fee is otherwise noted herein. In the event that the Plan Sponsor requests different or additional Services,
the parties shall meet to discuss relevant Empower capabilities and any additional fees that may apply.
The Basic Plan Administration Fee is $22 per Participant account per year.
The Basic Plan Administration Fee will be payable on a quarterly basis, based on the number of
Participant accounts with a balance at the end of the assessment period. Participants taking a full
withdrawal prior to a processing date will be charged the fee at the time of withdrawal.
In addition, Empower and/or one or more of its Affiliates may receive Fund Service Fees in connection
with the Plan.
6.2 Revenue Credit Arrangement.
Empower and Plan Sponsor agree that Empower will pay to the Plan, on a quarterly basis, the
Revenue Credits amount as described below. Revenue Credits shall be determined by multiplying the
Plan's average daily balance in each of the Plan's Investment Options for the quarter by the annual rate
(prorated for the quarter) of service fees paid to Empower by the Investment Option or its affiliates as
reflected in the Plan's Plan Fee Disclosure Report (a copy of the Plan's most recent Fee Disclosure Report
is available on the Plan Sponsor Wabsite) ("Revenue Credits"). Plan Sponsor Directs Empower to allocate
any Revenue Credits to Participant accounts proportionately based on the average daily balance of such
accounts in the Investment Option during the quarter and to Invest such amounts based on the Participant's
investment elections with respect to future contributions or, if none, the applicable Plan Default Investment
Fund. Revenue Credits shall be determined and allocated to the Participant accounts within 45 days after
the end of the quarter. In the event that the Agreement is terminated, Empower will determine and allocate
Revenue Credits to the Plan in advance of the Plan's scheduled termination date based on an estimate of
the Plan's average daily balance in each of the Plan's Investment Options.
The Revenue Credit under this arrangement is funded from Empower's general assets and is being
made available as a reduction in the compensation that Empower would otherwise earn in connection
with the services it provides to the Plan. No specific funds will be set aside in an account or fund for
the Plan's benefit or otherwise segregated for purposes of funding this arrangement, and the Plan
has no right, title or interest in any Revenue Credits prior to the time that the Revenue Credit is paid
to the Plan. No interest will be earned by the Plan or paid on Revenue Credits that are accrued. The
Plan Sponsor understands that the Investment Options are held in omnibus accounts and that the
amount of service fees received by Empower in relation to Plan assets from the Investment Options
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may differ from the amount of Revenue Credits due to differences in calculation methods between the
Investment Options and Empower, Plan Sponsor represents that it has reviewed this arrangement
and the allocation method with its legal and tax advisors and has determined that the arrangement is
consistent with the terms of the Plan and with Its fiduciary obligations and will not result in a violation
of the Code or any other applicable law. Plan Sponsor acknowledges and agrees that Empower shall
not be considered a fiduciary and shall not have or exercise any discretion, with respect to its offering
or administration of this arrangement. Plan Sponsor acknowledges that the amount of the Revenue
Credit may vary with changes in the Plan's Investment Options or if the amounts paid to Empower by
the Plan's Investment Options change.
6.3 Trustee/Custodian Services. Trustee or custodian services, as applicable, are provided
by Empower Trust Company, LLC ("ETC"). The compensation received by ETC for its services is reflected
in the Plan's fee disclosure report provided by Empower and the Empower Trust Company Bank Credits
below. Additional fees may be reflected in the trust/custodial agreement between ETC and Plan Sponsor.
If Plan Sponsor selects a trustee or custodian, as applicable, that requires changes to any procedures or
services in the Agreement, Empower reserves the right to change fees in this section.
6.4 Empower Trust Company Bank Credits. If Plan assets pass through a bank account
held by ETC or its Affiliates, ETC may earn credits and/or interest on Plan assets awaiting investment or
pending distribution. Any credits or interest earned by ETC are aggregated with credits and/or interest
earned by ETC's Affiliates and will be used to defray the aggregate expenses for the maintenance of bank
accounts. ETC will not retain credits and/or interest earned in excess of such maintenance expenses.
Credits and/or interest are earned from the use of (1) uninvested contributions received too late in the day
or not received in good order to be invested same -day and (ii) proceeds from Investment Option
redemptions where Plan distribution checks have not been presented for payment by Participants. Credits
and/or interest (1) begin to accrue on contributions on the date such amounts are deposited into the bank
account and end on the date such amounts are invested pursuant to Participant instructions, and (ii) begin
to accrue on distributions on the date the check is written or on the ACH date, as applicable, and end on
the date the check Is presented for payment or when the ACH clears against the account, as applicable.
Earnings of credits and/or Interest are at the rate the bank provides from time to time.
6.5 Enrollment.
6.5.1 Enrollment. Based on information provided by the Plan Sponsor or its designee,
Empower will enroll Participants in the Plan in a manner mutually agreed upon by the parties.
6.5.2 Eligibility Determination. Plan Sponsor Directs Empowerto determine employee
eligibility as Directed by the Plan Sponsor and through Plan Sponsor provided information and criteria.
Empower shall also communicate details of the enrollment process to eligible Participants. Plan Sponsor
agrees to notify Empower at least thirty (30) days prior to any change in the Plan's eligibility requirements.
Empower may discontinue this service if the Plan's new eligibility requirements are Incompatible with
Empower's recordkeeping system requirements.
6.5.3 Online Enrollment. Plan Sponsor Directs Empower to allow online enrollment.
Once the Payroll Data Interchange ("PDI") file is transmitted, Plan Sponsor Directs Empower to
communicate details of the enrollment process to eligible Participants allowing enrollment in the Plan
through the website or the voice response unit (" VRU" ).
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6.6 Deferral Processing. If Plan Sponsor provides Empower at implementation with an
electronic employee data feed of all the Participant deferral amounts/percentages or full PDI file, Plan
Sponsor hereby Directs and authorizes Empower to allow Participants to update their deferral elections via
the website and VRU. Empower will forward updated deferral information to Plan Sponsor according to the
schedule elected by Plan Sponsor.
6.7 Establishment of Participant Accounts. Empower shall establish and maintain an
account for each Participant. Each account record shall consist of the Participant's name, social security
number, address, date of birth, telephone number and such other information as may be required from time
to time for administration of the Plan. If the Plan allows for Roth after-tax, Empower will maintain an
accounting of the contributions and earnings in separate accounts. Amounts distributed from Roth accounts
will be made and tax reported pursuant to the applicable provisions of the Agreement.
6.8 Beneficiary Recordkeeping
6.8.1 Spousal Consent. If a beneficiary designation requires spousal consent, such
designation may be made only by a Plan administrative paper form.
6.9 Receipt and Investment of Contributions. Empower will credit contributions for
allocation to Participant accounts in accordance with Direction from the Plan Sponsor and as set forth
below. Empower will allocate or otherwise apply forfeitures under the Plan accounts, if any, as Directed by
the Plan Sponsor. Empower will pass Directions to invest such contributions, and to execute appropriate
transactions related to forfeitures, to the Plan trustee or custodian in accordance with investment Directions
of the Plan Sponsor.
6.9.1 Timing Requirements for Contributions Funded via ACH, Check or Mire. _
Contributions received by Empower in good order prior to the close of any Business Day will be processed
effective that Business Day, at that Business Day's net asset I unit values. Contributions not received by
Empower prior to the.close of Business Day will be processed effective the next Business Day.
6.10 Monitoring the Deferral Limits. Unless otherwise Directed, Empower will monitor
Participants' total deferrals under the Plan for the calendar year and provide warning messages for payroll
contributions processed within the Plan Service Center (PSG). However, it is the Plan Sponsors
responsibility to ensure that the applicable limit(s) for the Plan are not exceeded. Any distributions
requested by the Plan Sponsor to correct excess deferrals will be appropriately tax reported.
6.10.1 Empower will provide assistance to Participants in calculating special catch-up
contributions. Plan Sponsor acknowledges that Participants are fully responsible for the accuracy of these
calculations.
6A1 Investment Transfers of Existing Assets. Empower or its designee will process
investment transfers or exchanges, as applicable, received in good order subject to any conditions and/or
limitations imposed by the available Investment Options under the Plan or Investment Option Sponsors.
Empower will pass to the Plan trustee or custodian, as applicable, Directions to execute or record as
appropriate the corresponding transactions involving the assets of the Plan's trust. Requests for Participant -
initiated transfers between Investment Options will be processed if the request is received by Empower in
good order prior to market close on a Business Day. Any transfer request not received by Empower during
a Business Day will be processed the next Business Day, or such earlier time as may be required in order
to comply with applicable law.
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6.12 Plan Loans. Empower will administer Participant account reduction loans repaid by payroll
deduction for active Participants or ACH for terminated Participants, pursuant to the Plan's loan policy, as
amended from time to time. Loan requests may be initiated through the VRU or Participant website. The
following loan administration fees will apply to all Participant loans initiated after the Schedule Effective
Date.
$50.00 loan origination fee will be deducted from the amount of each loan processed.
$25.00 annual loan maintenance and conversion fee per loan will be deducted from the Participant's
account in the amount of $6.25 per quarter.
6.13 Distributions.
6.13.1 Empower will make payments to Participants pursuant to a Participant's request
and Plan Sponsor's Direction received in good order and will debit Participant accounts accordingly.
6.13.2 Except for those certain distributions described in Section 8 [Signatureless
Services] of this Schedule, Plan Sponsor agrees to provide a signature authorization for certain distribution
requests, including but not limited to distributions, alternate payee distributions and beneficiary distributions.
Empower reserves the right to charge an additional fee for services related to other distributions outside
the ordinary course of plan administration.
6.13.3 Tax Withholding and Reporting of Distributions.
6.13.3.1 Responsibility for Withholding and Reporting. Plan Sponsor
appoints Empower or its designee as its agent to perform income tax withholding and reporting for all
distributions Empower processes and to collect and remit state documentary stamp or similar taxes on all
loans Empower processes, to the extent applicable. Plan Sponsor agrees to provide all information needed
by Empower to perform these services. Empower or its designee shall deposit the income tax withheld with
the Internal Revenue Service ("IRS") and other appropriate governmental entities, as applicable, on or
before the applicable due dates for such remittances. Empower will complete necessarytax reporting forms
for distributions it processes, file the tax reporting forms with the IRS or other governmental authority, as
applicable, and send copies to the distributes. Distributions to a person subject to reporting and withholding
rules that differ from those applicable to United States residents will be subject to withholding applicable to
non-resident aliens unless otherwise Directed by the Plan Sponsor,
6.13.3.2 Withholding and Reporting for Plan Sponsor Initiated
Distributions and Rollovers. With respect to Plan Sponsor -initiated distributions or rollovers from the Plan,
Plan Sponsor Directs Empower to rely upon the information on Empower's recordkeeping system for
purposes of tax reporting and withholding, and to treat payees with U.S. addresses as U.S. persons and
payees with foreign addresses as foreign persons. Plan Sponsor certifies that such information is accurate
and compliant with the Foreign Account Tax Compliance Act ("FATCA") and the Code, and that required
documentation supporting such information has been collected by Plan Sponsor.
6.13.4 Distribution Withdrawal Fees
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For each benefit disbursement the following administration fee will apply and will be assessed to the
Participant:
$0.00 for each benefit disbursement.
6.14 Code Section 402(f) Notice. Empower shall provide Participants with the IRS model
notice, as amended from time to time, pursuant to Code Section 402(f).
6.15 Uncashed Checks. With respect to any checks issued from Plan assets during the term
of the Agreement, Plan Sponsor Directs Empower to treat such checks as void after 180 days and to
transfer the amounts to a plan level account on a semi-annual basis. Plan Sponsor is solely responsible for
determining the appropriate handling of uncashed checks and any unclaimed property under the applicable
federal and state laws including the determination and handling of amounts related to lost Participants.
6.16 Missing Participant Administrative Services. Plan Sponsor is solely responsible for
identifying and locating missing Participants. Upon request by Plan Sponsor, Empowerwill provide reports
or other information to the Plan Sponsor with respect to Participants with undeliverable addresses as
reflected in Empower's records. Also at Plan Sponsor's request, Empower will provide a description of
administrative services and associated fees, as updated from time to time, to assist the Plan Sponsor with
identifying and locating missing Participants and reissuing benefit payments to Participants. The
administrative services may include performing Participant address searches using a commercial locator
service, updating Participant address records and attempting to contact Participants using certified U.S.
mail. Plan Sponsor may select such services and agree to the associated fees via a separate letter of
direction.
6.17 Distribution Education Services. Empower or its Affiliates will make retirement
consultants available to Participants to provide distribution education services and may contact Participants
who are eligible to receive distributions from the Plan to provide Information regarding distribution options
under the Plan including rollover services and products offered by Empower.
SIGNATURELESS RECORDKEEPING SERVICES
7.1 General Requirements. This Section 7 [Signatureless Recordkeeping Services] describes
certain services under which Empower will process Participant requests without obtaining Plan Sponsor
signature or other further approval. In doing so, Empower will not exercise any fiduciary authority or make
any discretionary determinations. Rather, this Section 7 [Signatureless Recordkeeping Services] will act as
Direction by Plan Sponsor for Empower to process all Participant requests that meet the stated criteria. In
order to receive the Signatureless services detailed in this Section 7 [Signatureless Recordkeeping
Services] Plan Sponsor must utilize the Plan Service Center ("PSC") and must provide all necessary
information in a PDI file. Plan Sponsor must also provide any additional information or Direction as required
by, and In a form acceptable to, Empower. In addition, In most cases, Empower must be the sole
recordkeeper for the Plan. If at any time Plan Sponsor does not meet these general requirements, or does
not meet the specific requirements of any service described in this Section 7 [Signatureless Recordkeeping
Services], Empower shall not be responsible to continue to provide such service.
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7.1.1 Death Benefit Claim Payment Processing. Plan Sponsor Directs Empower to
process, without Plan Sponsor's further approval, death benefit claim forms received in good order from
Participants under the Plan in accordance with the procedures provided by Empower to Plan Sponsor.
Death benefit claim forms submitted without complete information or without a certified copy of the
deceased Participant's death certificate or other required documentation will not be processed, and the
claimant will be notified of the deficiency. Processing will continue once Empower receives all required
information and documentation in good order. Plan Sponsor agrees to make determinations with respect
to any competing claims, claims which require the Plan Sponsor's interpretation or other claims that are not
specifically addressed in the procedures. In order to receive this service, Plan Sponsor must also utilize
Empower's beneficiary recordkeeping and vesting tracking services, if applicable. This service shall
commence following completion of initial beneficiary solicitation.
7.1.2 Participant Rollover Contributions. Plan Sponsor Directs Empower to process
Participant rollover contributions received in good order pursuant to the Participant's instruction in
accordance with procedures provided by Empower to the Plan Sponsor and without the Plan Sponsor's
further approval. In the event that a Participant does not elect Investment Options on the Incoming direct
rollover form but otherwise completes the form, Plan Sponsor further Directs Empower to invest the money
according to the Participant's on -going investment elections, and if none are elected, then in the Default
Investment Option under the Plan at the time the incoming rollover is received. Separate accounts within
the Participant's account will be maintained for such rollovers.
7.1.3 Signatureless Distributions Due to Severance from Employment for Reasons
Other than Death or Disability. Plan Sponsor Directs Empower to process, without Plan Sponsor's further
approval, Participant requests for distribution due to severance of employment for any reason other than
death or disability, provided such requests are received in good order and in a manner acceptable to
Empower. In order to receive this service, Plan Sponsor must also utilize Empower's vesting tracking
service, if the Plan has a vesting schedule. If Plan Sponsor has not provided a Participant's termination
date or other required information, Plan Sponsor Directs Empower to notify Plan Sponsor to obtain missing
information before processing the distribution. For spousal consent purposes, Plan Sponsor Directs
Empower to rely on the marital status specified by the Participant in the request form, or as stored on
Empower's recordkeeping system, as applicable.
7.1.3.1 Signatureless Distribution Withdrawal Fees Due to Severance from Employment.
For each benefit disbursement the following administration fee will apply and will be assessed to the
Participant:
$0.00 for each benefit disbursement.
7.1.4 Signatureless In -Service Distributions at Age 59Yz. Plan Sponsor Directs
Empower to process, without Plan Sponsors further approval, Participant requests for age 59 % in-service
distributions, provided such requests are received in good order and in a manner acceptable to Empower.
Plan Sponsor represents that the Plan allows Participants to take in-service distributions at age 59 % and
will provide Empower with information concerning the sources eligible for such distributions. In order to
receive this service, Plan Sponsor must also utilize Empower's vesting tracking service, if the Plan has a
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vesting schedule. If Plan Sponsor has not provided a Participant's birth date, or if there is a discrepancy
between the birth date on the system and the birth date on the request form submitted by the Participant,
Plan Sponsor Directs Empower to reject the request pending further information.
7.1.4.1 Signatureless In -Service Distribution Withdrawal Fees.
For each benefit disbursement the following administration fee will apply and will be assessed to the
Participant:
$0.00 for each benefit disbursement.
Voluntary In -Service De Minimis Distributions. Plan Sponsor Directs Empower to process, without Plan
Sponsor's further approval, Participant -initiated De Minimis distribution requests received in good order and
in a manner acceptable to Empower.
7.1.6 Required Minimum Distributions (RMDs). The Plan Sponsor Directs Empower
to provide a notice to Participants who, based on the Plan records reflected on Empower's recordkeeping
platform, are RMD eligible and have not already set up a RMD on Empower's system. Unless the Plan
Sponsor separately Directs Empower otherwise in writing, if the Participant does not timely provide an
election for the RMD as described in the notice, the Plan Sponsor Directs Empower to process a RMD with
respect to such Participant in accordance with procedures provided by Empower, provided Empower has
sufficient data required to make such a distribution. In order to receive this service, Plan Sponsor must also
utilize Empower's vesting tracking services, if applicable.
7.1.7 Signatureless Distributions Due to Unforeseeable Emergencies. Plan
Sponsor Directs and authorizes Empower to process, without Plan Sponsor's further approval, all
Participant requests, received in good order and in a manner acceptable to Empower, for distributions due
to unforeseeable emergency resulting in a severe financial hardship to the Participant that cannot be
alleviated by any other means available to the Participant. Empower shall only process such requests if
they meet the safe harbor definition set forth in the Treasury Regulations, as described below. Plan Sponsor
further Directs Empower to rely on any and all representations made by a Participant in a request. The
following situations shall qualify for a distribution under this section:
7.1.7.1 An illness or accident of the Participant, the Participant's spouse, or the
Participant's dependent (as defined in Code §152, and for taxable years beginning on or after January 1,
2005, without regard to Code §152(b)(1), (b)(2) and (d)(1)(13));
7.1.7.2 Loss of the Participant's property due to casualty;
7.1.7.3 The following extraordinary and unforeseeable circumstances, if they arise
as a result of events beyond the control of the Participant: (a) the imminent foreclosure of or eviction from
the Participant's primary residence; (b) the need to pay for medical expenses, including nonrefundable
deductibles, as well as the cost of prescription drug medication; and (c) the need to pay for the funeral
expenses of a spouse or a dependent (as defined in Code §152, and for taxable years beginning on or after
January 1, 2005, without regard to Code §152(b)(1), (b)(2) and (d)(1)(B)) of Participant; (d) except in
35
City Council 19 — 38 9/19/2023
extraordinary circumstances, the following are examples of situations that shall NOT qualify for a distribution
under this section: (i) purchase of real estate; (ii) payment of college tuition; (iii) unpaid rent or mortgage
payments, except in the event of imminent foreclosure or eviction; (iv) unpaid utility bills; (v) loan
repayments; (vi) personal bankruptcy (except when resulting directly and solely from illness, casualty loss
or other similar extraordinary and unforeseeable circumstances beyond the Participant's control); (vii)
payment of taxes, interest or penalties; or (viii) marital separation or divorce.
7.1.7.4 Plan Sponsor will make determinations with respect to any unforeseeable
emergency distribution request that does not clearly fall within the guidelines set forth above. In the event
of any changes to applicable law, including safe harbor defined in the Treasury Regulations, Empower may
revise this Direction from time to time and without further notice to Plan Sponsor. This Direction shall
remain in effect until revoked by either party. In order to receive this service, Plan Sponsor must also utilize
Empower's beneficiary recordkeeping and deferral recordkeeping services.
7.1.7.5 For each Participant receiving an unforeseeable emergency distribution,
Plan Sponsor Directs Empower to notify Plan Sponsor to suspend elective deferrals for the period required
by the Plan, if any. Empower is Directed to deny any request where the unforeseeable emergency event
occurred prior to the Schedule Effective Date, or more than one year prior to the date the request is
received. Empower may contact Plan Sponsor for Direction when unusual situations arise. For each
request that is denied or that cannot be processed due to its failure to satisfy an unforeseeable emergency
event, Plan Sponsor Directs Empower to notify the Participant to contact Plan Sponsor if the Participant
wishes to appeal the determination.
7.1.7.6 Unforeseeable Emergency & Distribution Approval Fees.
Unforeseeable EmeroencyApuroval
For each unforeseeable emergency distribution approval the following administration fee will apply:
$0.00 for each unforeseeable emergency approval.
Distribution Withdrawal Fee
For each disbursement the following administration fee will apply and will be assessed to the Participant:
$0.00 for each disbursement.
7.1.8 QDRO Review and Determination Services and Fees.
7.1.8.1 Review: Plan Sponsor Directs and authorizes Empower to handle
QDRO correspondence to and from involved parties and attorneys, including phone, email and other
written communication. Plan Sponsor Directs Empower to distribute QDRO Procedures and Model
QDRO to involved parties and attorneys. Plan Sponsor Directs Empower to place benefit holds as
soon as administratively feasible pursuant to the Plan's adopted QDRO procedures. Plan Sponsor
Directs Empower to acknowledge receipt of a DRO and review the terms of the DRO to determine
whether the order meets the requirements of applicable federal law and satisfies the requirements
36
City Council 19 — 39 9/19/202.3
contained in the Plan's adopted QDRO Procedures. After review of a DRO, Plan Sponsor Directs
Empower to prepare and distribute approval, pre -approval or denial letters to the involved parties and
attorneys. Plan Sponsor Directs Empower to maintain QDRO records during the term of service,
including Pre -Approval, Approval and/or rejection letter(s).
7.1.8,2 Determination: Plan Sponsor Directs Empower to process the QDRO,
without Plan Sponsor's further approval, by establishing a separate account for the alternate payee
or making a lump sum distribution to the alternate payee. Plan Sponsor further Directs Empower to
process, without Plan Sponsor's further approval, all requests, received in good order and in a manner
acceptable to Empower, for distributions from alternate payee accounts established before or after
the Effective Date. Plan Sponsor Directs Empower to calculate any alternate payee's QDRO amount
based solely on the Participant's account records on Empower's recordkeeping system. Plan Sponsor
further Directs Empower to process, without the Plan Sponsor's further approval, distribution requests
received in good order and in a manner acceptable to Empower, with respect to alternate payee
accounts established before the Effective Date pursuant to QDROs previously processed by
Empower. The Plan Sponsor Directs Empower to calculate any alternate payee's QDRO amount
based solely on the Participant's account records on Empower's recordkeeping system.
7.1.8.3 If the alternate payee's awarded share exceeds the value of the
Participant's core investment account(s) under the Plan, Empower shall notify the Participant in writing to
liquidate and transfer the necessary remaining sum from the SOB into the core investment options, to
enable the processing of the QDRO. If the Participant fails to transfer the necessary amount within fifteen
(15) Business Days of the date of the notiticatlon, and if the necessary amount is available In the SOB
money market, Plan Sponsor Directs Empowerto transfer such amount into the Default Investment Option.
If there are insufficient available funds in the SDB money market, Plan Sponsor Directs Empower to notify
the SOB provider to liquidate all of the Participant's SOB investments and to transfer the entire amount into
the Default Investment Option.
7,1.8A QDRO Fees, For each qualified and processed QDRO, the Participant's
portion of the fee will be deducted from the Participant's account balance, and the alternate payee's portion
of the fee will be deducted from the alternate payee's account or from the lump sum distribution, as
applicable. Empower will charge the following fee of:
To cover the cost of reviewing a DRO, Empower will deduct from the Participant's and/or the alternate
payee's account balance a one-time QDRO review and determination fee equal to $400.00,
7.2 Additional Service Fees.
I Current
Express Delivery Fees. Empower will assess an additional fee to the $40.00 per
Participant upon a Participant's request for express delivery. disbursement
ACH Special Handling Fee, Empower will assess an ACH special handling fee $15.00 per
to the Participant upon a Participant's request for a disbursement via ACH. disbursement
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City Council 19 - 40 9/19/2023
Reprocessing Fee. If Plan Sponsor provides incorrect or incomplete
$150.00 per hour or
information or provides data in an unusable electronic or hard copy paper
as reasonably
format, Empower will assess a fee to the Plan Sponsor to reprocess or put the
determined by
data into a useable format. (Submission of data in a hard copy format will be
Empower
considered a request to provide this service; this includes submission of
Participant account takeover data).
Additional Plan Work. Empower may, at its discretion, provide additional plan
$150.00 per hour
work at the Plan Sponsor's request, which will be charged to the Plan Sponsor
at Empowers then current hourly rate or as quoted based on the additional plan
work requested.
*Additional Service Fees reflect current rates as of the effective date of this Agreement and may be adjusted
from time to time to reflect cost increases.
7.3 Payment of Fees. All fees not paid by Participants must be paid within thirty (30) days of
Empower's invoice to the Plan Sponsor unless another arrangement has been pre -approved by Empower
in writing. In the event any charges or fees reasonably and properly chargeable under the terms of the
Agreement, including this Schedule or other applicable documents signed by the Plan Sponsor remain
unpaid sixty (60) days after the date billed, Plan Sponsor Directs Empower to deduct such expense charges
from the Plan and Plan Sponsor affirms that the Plan document specifically allows such deduction from the
Plan. To the extent that the forfeiture or other Plan accounts would not pay Plan expenses under the Plan
document or the Plan accounts are insufficient, Plan Sponsor Directs Empowerto allocate such fees to the
Participant accounts, and to the investment choices in which the Participant accounts are invested, on a
pro rata basis using Participant account and investment option balance ratios as of the date of deduction.
Plan Sponsor agrees to amend the Plan, if necessary, to provide for the payment of expenses from Plan
assets consistent with the foregoing.
7.4 Fee Guarantee. Empower's fees shall remain in effect for five (5) years from the Schedule
Effective Date ("Guarantee Period"). Notwithstanding anything to the contrary, Empower reserves the right
to adjust fees at any time upon written notice to Plan Sponsor in the event that: (1) Plan Sponsor elects to
utilize different or additional services; (ii) Plan Sponsor changes any Investment Options utilized by the Plan
that provide service fees or other compensation to Empower, if applicable; (iii) there is an employer -initiated
event such as a plan merger, corporate acquisition or layoff resulting in a material decrease in Empower's
revenue or requiring Empower to perform additional services; (iv) legislative, regulatory or US postal rate
changes impact the Services; or_(v) there is a material change in the service fees received by Empower
from any Investment Options utilized by the Plan, if applicable. Empower may adjust fees at any time after
the Guarantee Period expires upon written notice to the Plan Sponsor.
ACCESS TO RECORDKEEPING SYSTEM & SERVICE REPRESENTATIVES
8.1 Automated Voice Response System. Participants will have access to an automated
voice response system via a domestic toll -free number and international toll number to inquire or make
account changes from a touch-tone telephone. Inquiry services available from the automated voice
response system will utilize share prices, unit values and account balances that are as of the last calculated
unit value/share price. The automated voice response system will be available 24 hours a day, 7 days a
week, except for routine maintenance of the system which, when necessary, will generally take place on
Sunday between the hours of 2:01 am and 2:01 pm Eastern Time. However, the system may also be
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City Council 19 — 41 9/19/2023
limited or unavailable during periods of peak demand, market volatility, systems upgrades, or
maintenance, or for other reasons.
8.2 Participant Service Representatives. Participant service representatives will be available
via a domestic toll -free number and international toll number to Empower to answer Participant questions
and process applicable transactions each Business Day between the hours of 5:00 am and 7:00 pm Pacific
Time and on Saturdays between 6:OOam and 2:30pm Pacific Time.
8.3 Plan Sponsor Access to Recordkeeping System. Plan Sponsor may interface with
Empower's recordkeeping system online via Empower's Plan Sponsor website to inquire or make changes
while administering the Plan. Upon request, Empower representatives will be made available to assist and
train employees of Plan Sponsor in properly accessing and processing transactions on the Empower's Plan
Sponsor website. Empower's Plan Sponsor website will be available consistent with the availability of the
automated VRU.
8.4 Participant Website
8.4.6 Website Use. Empower will, as part of the Services, host, maintain and make
certain information available to Plan Sponsor and Participants on a website or websites (the "Website
Services"). Plan Sponsor will not use or permit any use of the Website Services (i) in any unlawful or illegal
manner; (ii) in any way that could impair the Website Services or any other party's use thereof; or (III) to
distribute, sell, resell, license or transfer any of Plan Sponsors rights to access or use the Website Services
or make the Website Services available to any third party. Any user credentials, including user identification
and passwords, established by Plan Sponsor and its delegates or any Participant (each a "User ID") is
issued to a specific user and may not be shared or used by any individual other than that user. Plan Sponsor
will be responsible for the compliance by Its users with the applicable terms of this section. Empower may
terminate the User ID, or portions thereof, for any user involved in a breach of this section. Plan Sponsor
acknowledges that transmissions through the Internet are inherently unsecure, that virus protection
software, frrewalls and other security measures are not foolproof, and that the Website Services and their
content are not invulnerable to fraud or hacking. In addition, Plan Sponsor acknowledges that Empower
shall from time to time perform scheduled or emergency repairs, maintenance, and disaster recovery testing
on the websites, and that such activity, or other circumstances beyond Empower's reasonable control, may
cause the Website Services to be unavailable or delayed. Plan Sponsor agrees that Empower shall not be
liable for any such delays or downtime in the Website Services, or for any virus or malicious access to the
Website Services by third parties, provided that Empower has implemented and maintained security
features with respect to the Website Services that are consistent with the Agreement and commercially
reasonable industry standards.
8.4.7 Access to Participant Website. Participants will have access via a custom URL
www.santaana457.com, to a mobile responsive website to inquire or make certain account changes via the
Internet. In addition, Participants can download a complimentary Android app and an 10S phone, IPad and
Apple Watch app. The Android and Apple Watch apps currently support inquiry -only capabilities while the
iOS phone / IPad app supports both inquiry and certain change capabilities. All such apps will be subject
to the terms of the Agreement, as related to privacy and data security.
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City Council 19 — 42 9/19/2023
8.4.8 Website Availability. The website will include the Plan Sponsor's logo and be
available 24 hours a day, 7 days a week, except for routine maintenance of the system which, when
necessary, will generally take place on Sunday between the hours of 2:01 am and 2:01 pm Eastern Time.
However, the system may also be limited or unavailable during periods of peak demand, market volatility,
systems upgrades, or maintenance, or for other reasons.
8.4.9 Enhancements. Empower may periodically update or add new content, features,
services, tools or other functionality to the Participant website or other Empower Software as part of its
ongoing enhancement of the Services offered to Plan Sponsor or its Participants. Such additions will be
offered at no additional cost unless expressly agreed by Plan Sponsor or Participants (as applicable).
9 PARTICIPANT COMMUNICATION AND EDUCATION
9.1 Participant Education. Empower will provide support for employee enrollment and
education meetings, and will provide employee education and communications materials, including
education and planning tools through the internet:
9.1.1 Empower will provide 28 educational or enrollment meetings in year one, to be
used as Directed by Plan Sponsor; and 28 educational or enrollment meetings will be provided annually
thereafter to be used as Directed by Plan Sponsor. Any additional educational or enrollment meetings will
be provided for a fee of $500 per day.
9.12 An assigned representative will provide communication and marketing services
exclusively to the Plan. Such representative will be responsible for all group meetings as Directed by Plan
Sponsor.
9.2 Communication Materials. Empower will provide Participant educational and
communication materials regarding financial investing and retirement options. These materials may
include, but are not limited to, newsletters, brochures, and other materials as mutually agreed upon. The
materials will be customized with a specific, brand designed forthe Plan, including enrollment kit, Participant
website and educational flyers.
9.3 Group Presentations. Empower representatives will conduct group presentations at
which some or all of the following will be communicated: (1) summary of the key provisions of the Plan; (ii)
summary of authorized Investment Options; (III) discussion of Services including VRU inquiry, retirement
planning, and investment seminars; and (iv) instructions on how to sign up for the Plana
9.4 Individual Counseling Sessions. Upon request, Empower representatives will conduct
prescheduled Individual counseling sessions, utilizing a Participant paycheck analysis, an asset allocation
model and retirement counseling services, as Directed by Plan Sponsor.
9.5 Plan Sponsor Committee Meetings. Upon request, an Empower representative will
attend periodic Plan Sponsor committee meetings and will be prepared to provide information regarding
the Plan and its activities.
9.6 Communications and Education Plan Meetings. Empower will prepare a
communications and education plan for review by Plan Sponsor. Such Plan will be finalized in a mutually
agreeable manner.
City Council 19 — 43 9/19/2023
9.7 Financial Wellness. Empower will provide employee plan and investment education and
communications materials, including education and planning tools.
9.7.2 Empower Participant Experience. With certain exceptions, Empower provides
Participants with an estimated hypothetical monthly retirement income and goal based on a number of
factors including the Participant's Plan assets, Plan contribution rates and compensation data on the
Participant website.
9.7.3 Financial Wellness Services. Empower's financial wellness program provides
Participants with tools and services to review overall financial wellness including tools that allow
Participants to complete a personalized online assessment, the output of which provides the user with
ideas on the next steps they can take to address financial concerns they identified when completing
the assessment and educational resources to learn more about financial topics of interest, including
a learning center with educational content on certain financial wellness topics. Empower or its
affiliates may make retirement education consultants available to Participants to provide financial
wellness consultations and may contact Participants to offer financial wellness consultations.
Consultations involve topics such as (but not limited to): budgeting, saving, student debt, debt
prioritization, life insurance, managing investments and consolidating assets. Empower's financial
wellness tools, services and consultations may include information on financial products and services
made available by Empower or third -party providers. Participants may pay fees if they choose certain
products. Empower may receive fees and other payments from the products selected by
Participants. More information on the applicable financial wellness products and the fees and
payments that may be received by Empower is available upon request.
9.7.4 Participant Fiduciary Services. Empower may offer investment advice and
provide recommendations as a fiduciary under applicable law to Participants on certain Plan transactions,
such as point -in -time investment advice on designated investment alternatives, investment advisory
services available under the Plan, and recommendations on distribution and rollover options, which may
include services and products offered by Empower and its Affiliates. When Empower acts as a fiduciary, it
will do so in the best interest of the Participants. Empower will provide such fiduciary services pursuant to
applicable law.
10. REPORTING SERVICES
10.1 Participant Reporting. Empower will provide Participants a confirmation for transactions
involving Investment allocations, investment transfers, contribution rates, change of address, rollover
contributions, and rebalance activity. Empower will also make available to each Participant account
information on at least a quarterly basis, including beginning and ending balances, all contributions and
transactions processed, interest credited or change in value, fees and withdrawals deducted, transfers
processed and performance data on Investment Options held by the Plan to the extent such data is
provided by the Investment Option Sponsor, personal rate of return on investments, account balance
translated into an estimated monthly income amount, and balance in the SDB, as applicable. Participants'
statements shall be distributed in accordance with Section 4.8 [Electronic Delivery] of this Schedule.
Statements will be available within fifteen (15) Business Days after receipt of final information In good order
from third party sources.
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City Council 19 — 44 9/19/2023
10.2 Plan Sponsor Reporting. Empower will provide an Employer Plan Summary Report to
Plan Sponsor, summarizing Plan -level assets and Participant account balances, within thirty (30) Business
Days after each calendar quarter end ("Employer Plan Summary Report"), The following Plan information
will be addressed In the Employer Plan Summary Report: (1) summary of Plan transactions and assets; (il)
summary of contributions processed; (III) withdrawals; (iv) annuities purchased, if applicable; (v) periodic
payments; (vi) Investment Option grand totals —summarizes both dollars and units/shares and Plan activity;
(vii) Investment Option totals by money type — summarizes both dollars and units/shares and money type
activity; (viii)Participant summary — a report of account activity for each Participant.
10.3 Additional Optional Services and Fees
Additional Services and Fees
Plan Document Services
If the Plan Sponsor is using a plan document offered by Empower,
Empower will provide the Plan document including an applicable
adoption agreement for execution, and any Plan document amendments
that may be required due to change in applicable law, prior to the date
required.
Fees for Plan Document
If applicable, preparation of Empower sample plan document, including
Services
amendments:
No additional fee.
Annual Plan Review
Plan Sponsor will receive an annual Plan review including the following
information: (1) review of enrollment efforts; (ii) asset allocation
information, contributions, distributions (Investment Options and
fixed/variable split); (iii) voice response usage and enhancements; (iv)
benefit payments; (v) direct online system access — current services and
available services; (vi) legislative updates.
Regulatory Updates
Empower will periodically make information available to Plan Sponsor
concerning federal legislative activity of which Empower is aware that
may affect the Plan and related funding contracts. Such information,
however, does not constitute legal or tax advice regarding the legal
sufficiency of the Plan.
11. TRANSITION ASSISTANCE SERVICES
11.1 Transition Services. Empower agrees to support the transition of recordkeeping and
administrative services ("Transition Services") to a successor service provider subject to the terms and
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City Council 19 — 45 9/19/2023
conditions of the Agreement. Empower shall provide the following Transition Services prior to the Service
End Date (as defined below) of the Agreement.
11.2 Planning. Participate in conference calls and in -person meetings, as needed, with Plan
Sponsor and the successor service provider to designate the transfer team, define communication,
channels, discuss the transfer process and define expectations, responsibilities, and applicable deadlines.
Empower will designate a transition Project Manager to lead and be the contact person for the transition
effort. In the event Plan Sponsor requests that the Project Manager or other deconversion team member
attend a transition services meeting in person at a site other than Empower's office location, Empower's
fees for time and travel for such in -person meetings are $1,500 per day, per person.
11.3 Data Layouts. Provide the successor service provider with data layouts for Participants
and Plan Data residing on Empower administration systems, including but not limited to data layouts for
paper statement indicators, rebalance frequency elections, ACH indicators, outstanding loan terms and
payment amounts, powers of attorney on file, and dividend passAhrough elections. The data layouts will
correspond to Empower standard file formats.
11.4 Plan Materials. Upon termination, Empower shall provide the successor service provider
with copies of all Plan summaries, individual Participant statements (upon request) and otherforms, reports,
or web content; provided, however, Empower will provide such Plan materials only to the extent designed
specifically for the Plan and not deemed by Empower to be proprietary. In addition, Plan Sponsor agrees,
and will require any third party to whom Plan Sponsor provides the materials to agree, to maintain the
confidentiality of all Empower materials and information, including but not limited to web content,
communications material, and information on Empower's Plan Sponsor Website.
11.5 "Test" Data Transfer Files. Provide the successor service provider with two (2) full
volume test extract data transfer files for the Plan. Such files will be provided at a time mutually agreed
upon by the parties. Control totals and standard Empower reports will accompany the files.
11.6 "Refresher" Data Transfer Files. Provide the successor service provider with one (1) full
volume test extract refresher data transfer files for the Plan. Such files will be provided at a time mutually
agreed upon by the parties. Control totals and standard Empower reports will accompany the files.
11.7 "Live" Data Transfer Files. Provide the successor service provider with one (1) full live
data transfer file to the successor service provider in Empower standard file format for the Participant and
Plan Data residing on Empower administration systems as of a date mutually agreed upon by the parties.
The live data file will be in the same format as the test data file or in the test data file format. Control totals
and standard Empower reports will accompany the live data transfer file.
11.8 Questions about Data on Transfer Files. Provide up to twenty-five (25) aggregate hours
of Empower's time to answer questions about system data provided by Empower on the test data transfer
files, the refresher data transfer files and the live data transfer file. Empower will charge the Plan or Plan
Sponsor at then -current hourly rates for time spent in excess of twenty-five (25) hours.
11.9 Answering Questions. Provide up to twenty-five (25) aggregate hours of Empower's time
responding to questions about Plan administrative practices and communication materials used by
Empower in servicing the Plan. Empower will charge the Plan or Plan Sponsor at then -current hourly rates
for time spent in excess of twenty-five (25) hours.
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City Council 19 — 46 9/19/2023
11.10 Final Participant Valuation. Send to the successor service provider, at a mutually agreed
upon date, reports of all historical files, documents and records necessary for the continuing administration
and recordkeeping of the Plan in electronic form (where available) and/or paper form ("Final Participant
Valuation"). As of the Service End Date, the Final Participant Valuation includes: (i) Current Participant
indicative and financial data; (ii) Participant level reports; (III) Plan level totals; (iv) Investment valuation
statement; (v) Employee loan status report; (vi) Loan summary report; (vii) Deemed loan report; (viii)
Highest outstanding loan balance report; (ix) RMD report; (x) installment tax withholding report; (xii) On-
line beneficiary data, if maintained by Empower; and (xiii) Scanned beneficiary forms, if maintained by
Empower. Notwithstanding the foregoing, the parties acknowledge that the reports and Information
identified as Final Participant Valuation are subject to change based upon changes in plan administration
and/or system requirements. Plan Sponsor acknowledges that at the mutually agreed upon date, Empower
will provide only those reports applicable to the Plan and currently available from Empower's recordkeeping
system.
11.11 Open Participant Case Records. Send open case records at a mutually agreed upon
date, or Service End Date, if later, to Plan Sponsor or to successor service provider at Plan Sponsor's
Direction.
11.12 Year-end Processing. For Services that conclude as of December 31 for a calendar year
plan or the end of the Plan's fiscal year, as applicable, perform any compliance testing, government filings,
or other reporting required as of that year-end. For Services that conclude as of any date other than
December 31, perform any government filings for completed Services (e.g., Forms 1099-R for Participant
distributions) and provide to Plan Sponsor the same year-end reports and information otherwise provided
for a calendar or fiscal year, as applicable, but only reflecting the portion of the calendar or fiscal year, as
applicable, for which Services were provided.
11.13 Fees Related to Transition Services. In the event Plan Sponsor requests Empower to
provide additional or extraordinary Transition Services (beyond those described in items 11.1 through 11.12
above) including, but not limited to, change in data layout, change of data elements in standard layouts,
number of data transfer files, or services beyond Service End Date, Empower reserves the right to charge
the Plan or Plan Sponsor, as Directed by the Plan Sponsor, for additional or extraordinary Transition
Services at then -current hourly rates. Empower shall receive payment for services rendered within 30 days
of invoice delivery. In the event payment is not received within the stated timeframe all Transition Services
will cease until such time payment is received.
11.14 Transition Services after Service End Date. In addition to the foregoing, Empower
agrees to provide the following Transition Services for ninety days following the Agreement's termination
effective date ("Service End Date").
11.14.1 Provide up to 20 hours of Empower's time responding to questions from the
Plan Sponsor or its auditor. Empower will charge the Plan or Plan Sponsor at then -current hourly rates for
time spent in excess of 20 hours.
11.14.2 To the extent information and/or reporting is readily available from Empower's
systems, Empower agrees to provide to the successor service provider the following Transition Services
for up to 110 requests per month: (a) loan repayment information; (b) Participant account balances as of
44
City Council 19 — 47 9/19/2023
specific dates; (c) Participant account earnings and/or dividends for specific time periods; (d) distribution
history information; (a) reporting or respond to other Participant account history information requests; (f)
Participant account history information (excluding QDRO related information); (g) Participant Statements;
(h) Duplicate Forms 1099-R; (i) Provide QDRO related account history; (j) Respond to questions regarding
Plan specific processes, provided however that if the number of requests exceeds 110 in any given month,
a per -request fee of $500 will be assessed.
[Signature Page Follows]
City Council 19 — 48 9/19/2023
A-2023-164
By signing this Recordkeeping Services Schedule, the parties certify that they agree to be bound by its
terms and it's to be executed by their respective duly authorized officers as of the Schedule Effective Date.
Empower Annuity Insurance Company
Signature
Daniel A. Morrison
Printed Name
Senior Vice President, Government Markets
Title
8/30/2023
Date Signed
City of Santa Ana
Signature
Printed-
ct
Title
l� 1 Y 2
Date Signed
ATTEST:
nnifer L. I rtY lark
APPROVED AS TO FORM:
SONIA R. CARVALHO
City Attorney
By: fa
Laura A. Rossini
Chief Assistant City Attorney
FOR APPROVAL:
Kathryn Downs
Executive Director of Finance
City Council 19 — 49 9/19/2023
EXHIBIT A-1:
APPROVED QDRO PROCEDURES AND MODEL FORM FOR QUALIFIED PLANS
Forthe
City of Santa Ana Deferred Compensation Plan, 960140
1. INTRODUCTION. Empower has arranged for QDRO Consultants to review domestic relations orders
(DROs) related to the Plan, and to determine whether they are qualified domestic relations orders
(QDROs). The Plan is a defined contribution plan that provides a Participant with a benefit equal to the
vested portion of the Participant's account balance.
1.1. These QDRO Procedures help Plan Participants and other interested parties prepare QDRQS
more effectively and efficiently. Among other things, these QDRO Procedures explain:
• Who to contact for relevant information or Plan documents;
• The required information that must be in a DRO;
• The important information that should be in a DRO, and how the DRO will be interpreted if such
information is not included;
• Model or sample language to assist the parties in preparing a DRO;
• Where to send a draft or Executed DRO for review;
• How the Alternate Payee's interests will be protected during the DRO review process, including
any time or other limits on the review period;
• The opportunity to revise a rejected DRO;
• Who the Alternate Payee should contact to begin benefit payments; and
• What happens when the Participant or Alternate Payee dies.
2. CONTACT INFORMATION. If you have questions or requests related to the review or determination of
a QDRO, please contact QDRO Consultants at:
QDRO Consultants
www.qdros.com/contact
If you need a Participant's benefit statement, Plan documents (such as a summary plan description),
or if you have other questions or requests related to the Plan or a Participant, please contact the Plan
Recordkeeperat:
Empower
P.O. Box 173764
Denver, CO 80217-3764
Phone:1-800-338-4015
Fax:1-866-633-5212
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City Council 19 — 50 9/19/2023
3. DEFINITIONS TO QDRO EXHIBIT
Alternate Payee: An Alternate Payee is a Participant's spouse, former spouse, child, or other
dependent who is assigned Plan benefits in a DRO.
Approval Letter: A letter to the interested parties that indicates QDRO Consultants has approved an
Executed DRO and explains how the Plan Administrator will administer the QDRO's terms and
provisions.
Domestic Relations Order (DRO): Generally, a ORO is a court order, or an order issued by another
authorized state agency, that (1) is made pursuant to a state domestic relations law, and (2) provides
for payment of child support, alimony, or marital property rights to an Alternate Payee,
Empower: Empower is a retirement plan recordkeeping financial holding company based in
Greenwood Village, Colorado, United States.
ERISA: ERISA is the acronym for the Employee Retirement Income Security Act of 1974, as amended,
which governs most retirement and pension plans.
Executed DRO: A DRO that is signed and file stamped by the appropriate state court, or signed and
dated by the relevant state agency, including a copy of such DRO.
Participant: An individual who has a benefit in the Plan.
Plan: The defined contribution plan identified in these QDRO Procedures.
Plan Administrator: The person(s) or entity designated by the Plan's sponsor to have primary
authority and responsibility to administer the Plan's terms and provisions.
Pre -Approval Letter: A letter to the interested parties that indicates QDRO Consultants has approved
a draft DRO that would be a QDRO if it were an Executed DRO.
QDRO Consultants: QDRO Consultants Co., LLC ("QC"), was hired by Empower Retirement to review
DROs to determine whether DROs are qualified pursuant to the Plan's QDRO procedures, and to send
relevant notices to the Interested parties.
Qualified Domestic Relations Order (QDRO): A QDRO is a DRO that (1) requires the Plan
Administrator to assign or transfer some or all of a Participant's Plan benefits to an Alternate Payee,
(2) contains the information required by ERISA Section 206(d)(3)(C), (3) does not violate the restrictions
in ERISA Section 206(d)(3)(D), and (4) satisfies the other requirements contained in these QDRO
Procedures. Also, a DRO is not a QDRO until QC has determined, consistent with the Plan
Administrator's instructions, that the DRO is qualified.
4. QDRO CONTENTS.
Generally, a ORO must contain certain "required information" to be a QDRO, and should include certain
other "Important information" The subsections below discuss these categories of information in more
detail.
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City Council 19 — 51 9/19/2023
Model QDRO Language, which addresses all required issues, can be provided to assist you in
preparing the DRO.
4.1. REQUIRED INFORMATION
Generally, QC will reject a DRO that does not contain the required information listed below, or includes
instructions that are not clear. However, if a DRO does not contain a party's last known mailing address,
social security number, and/or date of birth, and if QC otherwise receives the missing information,
QDRO Consultants will review the DRO as if it contains the missing information. Also, if a DRO contains
a retirement plan name that is not the Plan's exact legal name, as identified below, and if it is clear that
the plan referenced in the DRO is intended to be the Plan, QC will review the DRO as if it contains the
Plan's legal name.
Names and Addresses: The DRO must include the names and last known mailing addresses of
the Participant and Alternate Payee.
Social Security Numbers: The DRO must include the social security numbers of the Participant
and Alternate Payee. For privacy reasons, you may provide these in a separate document.
Dates of Birth: The DRO must include the dates of birth for the Participant and Alternate Payee.
For privacy reasons, you may provide these in a separate document.
The Plan's Legal Name: The ORO must identify the Plan by its legal name:
City of Santa Ana Deferred Compensation Plan
State Domestic Relations Law: The DRO must state that it is made pursuant to a state domestic
relations law.
Child Support / Alimony I Marital Property Rights: The DRO must indicate that it provides child
support, spousal support, and/or marital property rights to the Alternate Payee.
Alternate Payee's Benefits: The DRO must clearly state the portion of the Participant's Plan
benefits that is assigned to the Alternate Payee, either as a lump -sum dollar amount OR a
percentage of the Participant's account balance, and must include the date as of which the
assignment is effective ("Assignment Date").
The current recordkeeper cannot obtain account balance information or calculate investment
gains/losses on any Participant accounts for periods prior to the restriction date as determined by
Empower Annuity Insurance Company, which is October 1, 2023 ("Restriction Date"). Therefore,
the DRO must not contain an Assignment Date that is prior to the Restriction Date.
Payment Date: The DRO must include language that permits the Alternate Payee to elect to begin
receiving his/her benefits as soon as administratively possible after the date that QC determines
that the DRO is a QDRO or, if later, at the earliest date permitted under the Plan.
Payment Period: The DRO must include language that the Alternate Payee shall receive his/her
benefits in a single lump -sum payment, or in any other form of payment that the Plan permits.
4.2. IMPORTANT INFORMATION I DEFAULT PROVISIONS
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City Council 19 — 52 9/19/2023
The DRO should also address the following issues. If it does not QC will review the DRO as if it includes
the default provision identified below for that issue.
Investment Gains/Losses: The DRO should specify whether the Alternate Payee's share of the
Participant's benefits will be credited with investment earnings (which include both gains and
losses) from the Assignment Date to the date that the Plan Administrator establishes and funds a
separate account for the Alternate Payee ("Segregation Date").
If the DRO is silent on this matter, the Plan Administrator will credit investment earnings to the
Alternate Payee from the Assignment Date to the Segregation Date.
The Plan Administrator will always credit investment earnings to the Alternate Payee's account
from the Segregation Date to the date the Alternate Payee receives payment of his/her benefits.
Allocation to Alternate Payee from Participant's Accounts: The DRO should state how the
Alternate Payee's assigned benefits shall be allocated from all of the Participant's vested sub -
accounts and/or investment funds (excluding any Plan loan) as of the Segregation Date. If the DRO
is silent on this matter, the Plan Administrator will administer the QDRO as if it included a provision
to allocate the Alternate Payee's assigned benefits on a pro rate basis from all of the Participant's
vested sub -accounts and/or investment funds (excluding any Plan loan) as of the Segregation Date.
Initial Investment of Alternate Payee's Benefits: The DRO should state how the Alternate
Payee's benefits shall be initially invested. If the DRO is silent on this matter, the Plan Administrator
will administer the QDRO as if it included a provision for the Alternate Payee's benefits to be initially
invested in the same funds and in the same proportion as the Participant's account. The DRO
should also state that the Alternate Payee may then elect any investment option that the Plan offers.
Participant Loans: If the DRO assigns a percentage of the Participant's account balance to the
Alternate Payee, the DRO should specify whether the Participant's Plan loans, if any, will be
included or excluded in the Participant's account balance when calculating the Alternate Payee's
share of the Participant's benefits. The examples below show that including Plan loan value will
increase the amount assigned to the Alternate Payee.
Example — 50% assignment / EXCIUSUM loan balance
Participant's Total Account Balance $100,000
Participant's Outstanding Loan Balance $20,000
Participant's Account Balance Excluding Loans $80,000
($100,000 - $20,000)
50% Assignment to Alternate Payee (0.5 x $80,000) $40,000
Example — 50% assignment / Including loan balance
Participant's Total Account Balance $100,000
Participant's Outstanding Loan Balance $20,000
Participant's Account Balance Including Loans $100,000
(loan is not subtracted)
50% Assignment to Alternate Payee (0.5 x $100,000) $50,000
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City Council 19 — 53 9/19/2023
Please note that even if a portion of the Participant's Plan loan value is transferred to the Alternate
Payee, no portion of the actual Plan loan (i.e., the obligation to pay it back) may be transferred to
the Alternate Payee. The Participant will have to pay back the entire loan.
If the DRO is silent on this matter, the Plan Administrator will administer the QDRO as if it specified
that the Participant's Plan loans will be excluded from the Participant's account balance for this
purpose.
Alternate Payee's Death: The DRO should specify that, if the Alternate Payee dies before
receiving payment of his/her entire benefit, the Plan shall pay any remaining benefits to the
Alternate Payee's beneficiary. If the DRO is silent on this matter, the Plan Administrator will
administer the DRO as if it included this default provision.
Participant's Death: The DRO should specify that the Participant's death shall not affect the
Alternate Payee's right to his/her benefits as provided in the QDRO. If the DRO is silent on this
matter, the Plan Administrator will administer the DRO as if it included this default provision.
QDRO Review and Determination Fee: To cover the cost of reviewing a DRO, the Plan
Administrator will deduct from the Participant's and/or the Alternate Payee's account balance a
one-time QDRO review and determination fee equal to $400. This fee applies even if QC does not
approve the DRO.
The DRO should specify, from among the following options, how the fee should be allocated
between the Participant's and/or the Alternate Payee's account balance:
• Divided equally between the Participant and the Alternate Payee;
• Charged entirely to the Participant; or
• Charged entirely to the Alternate Payee.
If the DRO is silent on this matter, the Plan Administrator will administer the DRO as if it specified
that the fee be divided equally between the Participant and Alternate Payee.
Regardless of how the DRO directs the fee to be allocated, when you first submit a DRO (regardless
of whether it is a draft or Executed DRO) to QC, the Plan Administrator will deduct the entire fee
from the Participant's account balance. If QC approves the DRO, the Plan Administrator will reduce
the amount of benefits assigned to the Alternate Payee by the portion of the fee, if any, that is
allocated to the Alternate Payee.
5. DRO REVIEW PROCESS
When you have prepared a DRO and you would like the Plan to enforce it, you must submit the DRO
to QC for review. To ensure timely receipt, DROs should be securely submitted at
https://gdros.com/submit. Please see the "CONTACT INFORMATION" section above for QC's contact
information. Consistent with these QDRO Procedures and as directed by the Plan Administrator, QC
will determine whether an Executed DRO qualifies as a QDRO, or whether a draft DRO would qualify
if it were executed.
The Plan Administrator will typically place a `hold" on the Participant's Plan benefit during the period of
the review to protect benefits that may be assigned to the Alternate Payee, as described in the
"BENEFIT HOLD / RESTRICTION" section below.
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City Council 19 — 54 9/19/2023
5.1. Review of Draft DROs: The Plan Administrator will enforce only an Executed DRO that qualifies
as a QDRO. However, you may choose to submit a draft DRO to QC for review before having it
executed. Addressing potential issues in the DRO before having it executed reduces the likelihood
that you will need to submit multiple revised drafts to the court.
5.2. DRO is Rejected. If QC rejects a DRO, QC will promptly notify the Participant, Alternate Payee,
and their attorneys and/or representatives in writing, including the specific reason(s) why the DRO
failed to qualify.
5.2.1.Revise a Rejected DRO: Generally, interested parties will have an opportunity to revise a
rejected DRO and to resubmit it to QC for another review and determination. However, there
is a maximum period the Plan Administrator will "hold" a Participant's benefit during the DRO
review process, as described in the "BENEFIT HOLD / RESTRICTION" section below.
5.3. DRO is Approved. If QC determines that a DRO is a QDRO; QC will promptly send a Pre -
Approval Letter (for a draft DRO) or an Approval Letter (for an Executed DRO) to the Participant,
Alternate Payee, and their attorneys and/or representatives.
6. BENEFIT HOLD / RESTRICTION
The Plan Administrator will place a "hold" on the Participant's Plan benefit during the DRO review
process, as well as upon certain other triggering events. The hold will protect benefits that may be
assigned to an Alternate Payee by preventing the Participantfrom receiving any benefit payments from
the Plan.
6.1. Placing a Benefit Hold
QC will direct the Plan's recordkeeper to place a hold on a Participant's Plan benefit as soon as
administratively feasible after receiving any of the following:
f Draft DRO;
Executed DRO;
• Other court order that attempts to place a hold on, or assign partof, a Participant's Plan benefit
(e.g., temporary restraining order, income withholding order, etc.);
• Joinder or other similar court document that attempts to join the Plan as a party to a domestic
relations proceeding;
e Letter of adverse interest or other written notice from a potential Alternate Payee, or his/her
attorney, that the Alternate Payee has an interest in the Participant's Plan benefit; or
Plan Administrator's written direction to place a hold.
Divorce Decree --:QC will direct the recordkeeper to place a hold if it receives a divorce decree or
similar court order.
Please Note -- Simply requesting a copy of the Plan's QDRO Procedures or Model QDRO is not
sufficient to place a hold on a Participant's Plan benefit.
Generally, a benefit hold will continue until it is removed by a subsequent action, as described in
the subsection below.
6.2. Removing a Benefit Hold
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City Council 19 — 55 9/19/2023
The requirements to remove a benefit hold may be different depending on the reason the hold was
placed, Each paragraph in this subsection lists, in bold type, a document that can cause a hold to
be placed, followed by the method(s) to remove a hold placed pursuant to that document.
6.2.1. Draft DRO / Letter of Adverse Interest: If a benefit hold was placed due to receiving a
draft DRO, or a letter of adverse interest or similar written notice, QC will direct the Plan's
recordkeeper to remove the hold upon receiving any of the following:
• Executed DRO (at which time an Executed DRO benefit hold will commence);
• Subsequent court order to remove the hold, or that clearly indicates the Alternate
Payee has no interest in the Participant's Plan benefit;
• Plan Administrator's written direction to remove the hold; or
• Notarized letter from the Alternate Payee, or letter from his/her attorney, that requests
the removal of the hold, and that names the Plan and the Participant.
6.2.2. Executed DRO: If a benefit hold was placed due to receiving an Executed DRO, QC will
direct the Plan's recordkeeper to remove the hold (1) if it approves the DRO, or (2) upon
receiving any of the following:
• Subsequent Executed DRO that vacates or revises the prior Executed DRO (at which
time a new Executed DRO benefit hold will commence);
• Subsequent court order that terminates the Alternate Payee's right to the Participant's
Plan benefit, including an order to vacate the Executed DRO; or
• Plan Administrator's written direction to remove the hold.
6.2.3. Other Court Order / Joinder: If a benefit hold was placed due to receiving a court order,
other than a DRO, or a joinder or other similar court document, QC will direct the Plan's
recordkeeper to remove the hold upon receiving any of the following:
• Executed DRO (at which time an Executed DRO benefit hold will commence);
• Subsequent court order to remove the hold, that vacates the court order or joinder that
caused the hold, or that clearly indicates the Alternate Payee has no interest in the
Participant's Plan benefit: or
• Plan Administrator's written direction to remove the hold.
6.2.4. Plan Administrator's Written Direction: If a benefit hold was placed due to receiving the
Plan Administrator's written direction, QC will direct the Plan's recordkeeper to remove the
hold only upon receiving the Plan Administrator's subsequent written direction to remove the
hold.
7. EFFECT OF REMOVING HOLD! SUBSEQUENT DRO
Approved DRO Before Hold Removal: If QC approves an Executed DRO before a benefit hold is
removed, the Alternate Payee will receive payments from the Plan pursuant to the QDRO.
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City Council 19 -- 56 9/19/2023
No Approval Before Hold Removal: If QC does not approve an Executed DRO before a benefit hold
is removed, the Participant will be permitted to elect to receive a distribution if he/she is otherwise
eligible.
Approved DRO After Hold Removal: If QC approves an Executed DRO after a hold is removed, the
QDRO will be applied on a prospective basis only.
8. MISCELLANEOUS
8.1. Fair Split of Participant's Benefits
QC will not answer questions 'regarding whether a QDRO has fairly or equitably divided the
Participant's benefits among the Participant and Alternate Payee. Instead, QC's role is limited to
the technical requirements of DRO review and QDRO determination. It is the responsibility of the
parties and/or their attorneys to determine what is fair and equitable, and to negotiate the QDRO's
substantive provisions.
8.2. Incorrect Payments
The Plan Administrator has the right to require the Participant and/or the Alternate Payee to return
to the Plan any overpayment. An overpayment is any Plan payment (or portion of a payment) to
a party that was not required by the Plan or a QDRO. If the overpayment should have been paid
to the other party, the Plan will recover the overpayment from the overpaid party and, in turn, will
pay that amount to the other party.
8.3. QDROs Issued After Death
A DRO will not fail to qualify as a QDRO solely because it was submitted to the Plan Administrator
after the death of the Participant or Alternate Payee. For example, if an attorney submits a draft
DRO to be preapproved and the Participant or Alternate Payee dies before the DRO is signed by
the court, the Plan Administrator would honor an Executed DRO submitted after the Participant's
or Alternate Payee's death if it otherwise would qualify as a QDRO.
8.4. Begin Alternate Payee's Benefit Payments
If QC approves a DRO, and if the Alternate Payee is eligible to begin receiving his/her assigned
benefits, the Alternate Payee must contact Empower Retirement at 1-800-338-4015 to obtain the
appropriate payment forms and instructions. The Alternate Payee should allow sufficient time
subsequent to approval of the DRO for the Plan Recordkeeper to calculate and segregate the
Alternate Payee's assigned benefit, before contacting Empower Retirement.
8.5. Federal Taxes
The Internal Revenue Code provides that an Alternate Payee, who is the Participant's spouse or
former spouse, is responsible for all federal taxes on Plan distributions to the Alternate Payee. On
the other hand, for distributions to an Alternate Payee who is the Participant's child or other
dependent, the Participant is responsible for all such federal taxes. A QDRO may not change
these rules of federal taxation and, as a result, a DRO does not need to identify which party is
responsible. If a DRO does address federal taxes, QC will not reject the DRO even if it is
inconsistent with federal tax law. However, the Plan Administrator will report distributions as
required by law, regardless of any conflicting provisions in the QDRO.
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City Council 19 — 57 9/19/2023
QDRO MODEL FORM
[NAME OF PARTY] )
Petitioner, ) Case No.
Qualified Domestic Relations Order
and 1
[NAME OF PARTY] )
Respondent. )
This domestic relations order ("Order") is intended to be a qualified domestic relations order ("QDRO"), as
defined in Section 206(d)(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA" ), and in Section 414(p) of the Internal Revenue Code of 1986, as amended ("Code").
1. Plan Name: This Order applies to the City of Santa Ana Deferred Compensation Plan (Plan), as well
as to any successor plan to the Plan.
2. Participant Information: The name, last known address, social security number, and birth date of the
Plan "Participant" is:
Name:
Address:
Email:
Social Security Number: See Personal Information Addendum Form
Birth Date: See Personal Information Addendum Form
*For security purposes, QDRO Consultants strongly encourages parties and/or their counsel to use the
Personal Information Addendum Form.
Participants Attorney Information:
Attorney's Name:
Address: _
Phone: _
Email:
3. Alternate Payee Information: The name, last known address, social security number and birth date of
the "Alternate Payee" is:
Name
Address:
Email:
Social Security Number:See Personal Information Addendum Form
Birth Date: See Personal Information Addendum Form
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City Council 19 — 58 9/19/2023
*For security purposes, QDRO Consultants strongly encourages parties and/or their counsel to use the
Personal Information Addendum Form.
Alternate Payee's Attorney Information:
Attorney's Name:
Address:
Phone:
Email:
The Alternate Payee shall have the duty to notify the Plan Administrator in writing of any changes in his/her
mailing address subsequent to the entry of this Order.
4. State Domestic Relations Law: This Order is entered pursuant to the authority granted in the
applicable domestic relations laws of the State of
5. Marital Property Rights, Spousal Support, and/or Child Support: This Order relates to the provision
of (marital property rights] [spousal support] [child support] to the Alternate Payee,
6. Benefit Assignment: This Order assigns to the Alternate Payee L% OR $� (but in no
event more than 100%) of the Participant's vested account balance in the Plan as of the Assignment Date
(or the closest valuation date thereto) ("Assignment Date"). The "Assignment Date" is
*
* In this blank enter the date of divorce, separation, or other appropriate or agreed upon date. Delete this
instruction after filling in the blank.
Any outstanding Participant loan in the Plan shall not be included in the Participant's vested account
balance for purposes of determining the amount to be assigned to the Alternate Payee, and no portion of
any such loan shall be assigned to the Alternate Payee. If the Participant's account balance consists of
different sub -accounts and/or is invested in different investment fund options, the benefit assignment to the
Alternate Payee shall be allocated on a pro rata basis from such vested sub -accounts and/or investment
fund options. The assigned benefit shall be adjusted for gains and/or losses from the Assignment Date
through the date that the Plan segregates the Alternate Payee's assigned benefit from the Participant's
account balance.
7•. QDRO Review and Determination Fee: A QDRO review and determination fee will be assessed against
the Participant's account balance upon initial review of the DRO. However, once the final QDRO has been
approved, the Plan Administrator will reduce the Alternate Payee's assigned share of the benefits by 50% of
the fee.
8. Alternate Payee's Separate Account: Upon determining that this Order is a QDRO, the Plan shall
segregate the Alternate Payee's assigned benefit into a separate account in the Alternate Payee's name. The
Alternate Payee's account shall be invested in the same options and in the same proportions as the assigned
benefits were invested prior to being assigned to the Alternate Payee.
9. Time and Form of Payment: The Alternate Payee may elect to receive a distribution from the Alternate
Payee's account as soon as administratively feasible following the date this Order is approved as a QDRO
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City Council 19 — 59 9/19/2023
or, if later, at the earliest date permitted under the Plan or in Code Section 414(p). The Alternate Payee
may elect to receive a distribution from the Alternate Payee's account in any form available to participants and
alternate payees generally under the Plan's provisions other than, if applicable, a joint and survivor annuity with
respect to the Alternate Payee and a subsequent spouse. The Alternate Payee shall provide the Plan with any
information and forms required to facilitate payment of the Alternate Payee's account.
10. Participant's Death: The Participant's death shall have no impact on the Alternate Payee's right to the
Plan benefits assigned in this Order.
11. Alternate Payee's Death: If the Alternate Payee dies prior to complete distribution of the Alternate
Payee's Plan benefits, the Alternate Payee's remaining Plan benefits shall be distributed to the Alternate
Payee's designated beneficiary(ies) or, in the absence of such designation, pursuant to the Plan's default
beneficiary provisions.
12. Impermissible Benefits: Nothingcontained in this Order shall be construed to require the Plan (a) to
provide any type or form of benefit, or any option, not otherwise provided under the Plan, (b) to provide
increased benefits determined on the basis of actuarial value, or (c) to pay benefits to the Alternate Payee that
are required to be paid to another alternate payee under another order previously determined to be a QDRO.
13. QDRO Determination and Notice: The Participant; Alternate Payee, and/or their representatives shall
promptly deliver a copy of this Order, to the Plan. As provided in ERISA Section 206(d) and in Code Section
414(p), the Plan shall determine whether the Order is a QDRO and shall provide written notice of such
determination to the Participant, Alternate Payee, and, if applicable, their representatives.
14. QDRO Administration and Interpretation: Because this Order is intended to be a QDRO, the Order
shall be administered and interpreted consistently with ERISA, the Code, and the Plan's terms and procedures.
15. Court's Jurisdiction: The Court shall retain jurisdiction over this Order, including to amend the Order if
necessary to conform it to the original intent of the parties and/or to establish or maintain its status as a QDRO:
16. Overpayments: If the Participant receives Plan benefits that are assigned to the Alternate Payee in this
Order, or if the Alternate Payee receives Plan benefits that are not assigned to the Alternate Payee in this
Order, then the relevant party shall promptly return such overpayment to the Plan.
17. Participant's Actions: The Participant shall not take any action, or refrain from taking any reasonable
action, that can circumvent the intent of this Order, or that can diminish the Alternate Payee's rights provided
in this Order.
18. Delivery of Order: Upon entry of this DRO, any of the parties shall immediately deliver a copy of this
DRO to QDRO Consultants. The parties should securely submit a DRO at https;//gdros.com/submit.
IT IS HEREBY ORDERED:
Executed on:
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City Council 19 — 60 9/19/2023
Judge
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City Council 19 — 61 9/19/2023
EXHIBIT A-2:
PERFORMANCE STANDARDS
for the City of Santa Ana Deferred Compensation Plan (457(b) Governmental Plan)
Empower agrees to provide services in accordance with the performance standards stated herein.
In the event Empower does not meet the performance standards listed below, Empower will be given an
opportunity to cure such failure. If Empower fails to meet the performance standard in the subsequent
quarter, Empower agrees to forfeit revenue for each performance standard not met pursuant to the "Fees
at Risk" column below. In no event, however, shall the total amount forfeited by Empower in any given
calendar quarter exceed 10% of Empower's quarterly Basic Plan Administration Fee determined as of the
beginning of each calendar quarter based upon the average daily balance of Plan assets during the
calendar quarter. For illustrative purposes, the calculation for quarterly revenue placed at risk would be:
[(A*B) *C], in which
"A" is the quarterly Basic, Plan Administration Fee for the 457(b) Plan; and
"B" is the average daily balance of Plan assets during the calendar quarter; and
"C" equals the lesser of the sum of the percentages attributed to each performance standard not
met by Empower for a calendar quarter or 10%.
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City Council 19 — 62 9/19/2023
Plan Sponsor &
Participant Service
Minimum Service Standard
Retirement Representatives
Performance Measurement
Fees at Risk
available 99% of time during
regular hours of service (S a.m. to
10 p.m. EST, Monday through
0.25% of quarterly plan
Participant Contact
Friday and Saturdays between
Metric provided as part of the
fees for each 0.1% below
Center Hours of
quarterly Empower Service
the 99% benchmark with
Availability
9:00 a.m. and 5:30 p.m. EST)
Level Agreement Report
maximum fee reduction
except for closings of NYSE,
of 1%
holidays and shortened hours
associated with early market close
or holiday eves
99% of the time IVR/intemel
Metric provided as part of the
IVR / intemet Availability
available excluding regularly
quarterly Empower Service
1% of quarterly fees
scheduled maintenance
Level Agreement Report
99% of the time reports available
Metric provided as part of the
Plan Reporting for Plan
online - updated monthly and
quarterly Empower Service
o
1% of quarterly fees
Sponsor
nightly excluding regularly
scheduled maintenance
Level Agreement Report
�I
Delivered prior to January 31 of
Metric provided as part of the
Distribution of Forth
1099R
each calendar year, excluding
quarterly Empower Service
1 % of quarterly fees
corrected 1099Rs
Level Agreement Report
i
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City Council 19 — 63 9/19/2023
Plan Sponsor &
Participant Service
Minimum Service Standard
Performance Measurement
Fees at Risk
DC Plan statements mailed and
made available electronically, if
applicable, fdteen (15) Business
Days after quarter -end.
TRS Statements, if selected by
Participant Statement
the Plan Sponsor, mailed and
po
Metric provided as part of the
Mailing
made available electronically, if
quarterly Empower Client
1% of quarterly fees
/ Availability
applicable, twenty (20) Business
Service Agreement Report
Days after quarter -end.
Twenty (20) Business Days
allowed for first statement coming
out of implementation of new
services.
99% of participant disbursement
requests processed within two (2)
Business Days of completed
requests received in good order.
Transactions must be entered by
Metric provided as part of the
Disbursements
4 p.m. EST or close of market due
quarterly Empower Service
1% of quartedy fees
to shortened hours associated
Level Agreement Report
with early market close / holiday
eves (+3 days applies for all
transactions including company
stock)
Contribution and loan repayment
processing completed within two
(2) Business Days following
Contributconfirmation
and Loan
of totals by the Plan
Metric provided on the
Repayment Processing
Repayment
Sponsor (i.e. file that Is In good
quarterly Empower Service
1% of quartedy fees
order). Pasting of contributions to
Level Agreement Report
Participant amounts occurs two
(2) Business Days following the
ACH funding release.
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City Council 19 — 64 9/19/2023
99% of investment transfers
processed same Business Day if
participant direction received in
good order by Empower by 4 p.m.
EST, early close time of
Investment Transfers investment, or dose of market
due to shortened hours
associated with early market close
or holiday eves (excluding
investment transfers involving
company stock)
Executed as part of
automated processes.
Accuracy will be consistent
with minimum service
standard unless otherwise
disclosed.
Reported as part of the
quarterly Empower Service
Level Agreement Report.
1 % of quarterly fees
_._. _..._..—i
Empower shall not be liable for the performance standards and the revenue at risk stated herein for failure
to meet any of the performance standards as a result of an interruption of any service provided under the
Agreement or delayed or defective performance of such service arising out of any Force Majeure Event as
described and in accordance with Section 12.7 of the Agreement. Empower shall maintain a reasonable
disaster recovery plan and shall use its best efforts to resume services on a normal basis as soon as
practicable.
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City Council 19 — 65 9/19/2023
SCHEDULE B:
INVESTMENT ADVISORY $ MANAGEMENT SERVICES SCHEDULE
LIST OF PLANS
City of Santa Ana Deferred Compensation Plan ("457(b) Plan"), 960140
This Investment Advisory and Management Services Schedule ("Schedule") is entered into by the
parties pursuant to the Master Services Agreement between Empower and Plan Sponsor dated October 1,
2023 (the "Agreement"). This Schedule shall be entered into between Empower Advisory Group, LLC, an
Affiliate of Empower (hereinafter referred to as "Adviser") and Plan Sponsor effective as of October 1, 2023
(subject to change) ("Schedule Effective Date"). This Schedule hereby incorporates by reference, and
each party agrees to be bound by, the terms of the Agreement. As such, this Schedule forms a separate
and independent Investment Advisory and Management Services agreement for the Plan. Capitalized
terms used but not defined herein shall have the meanings given to them in the Agreement. In the event of
a conflict between the terms of the Agreement and this Schedule, this Schedule shall supersede and
control, but only with regard to the Servicts (defined below) rendered by Adviser with respect to the
employee benefit plan(s) sponsored by Plan Sponsor. For the avoidance of doubt, the terms of this
Schedule will not govern nor have any applicability to other relationships or services between Empower, or
any other Empower Affiliate, and Plan Sponsor.
Plan Sponsor is engaging Adviser pursuant to this Schedule to provide investment advisory and
analytic Services to certain Participants in the Plan(s) (defined below) for which Empower provides
recordkeeping, administrative and other Services for Plan Sponsor as set forth In the Agreement. Plan
Sponsor maintains the Plan, and on behalf of itself, as Plan Sponsor, and on behalf of the Plan Administrator
of the Plan, has the authority to appoint agents and service providers for the Plan. Plan Sponsor
understands that Adviser has selected Morningstar Investment Management, LLC ("Subadviser") to serve
as an independent financial expert pursuant to Department of Labor Advisory Opinion 2001-09A (and any
modifications or amendments thereto), to perform investment services including advisory Services and
discretionary Managed Account Services, as further described in this Schedule. In consideration of these
covenants, mutual representations and agreements contained herein, Adviser and Plan Sponsor agree as
follows:
DEFINITIONS
"Advisers Act" shall mean the Investment Advisers Act of 1940, as amended.
"Managed Account Participant" shall mean a Participant participating in the Managed Account Service,
or its successor service.
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City Council 19 — 66 9/19/2023
"Managed Account Service" shall mean Adviser's discretionary investment advisory service, as further
defined in this Schedule.
"Online Advice Participant" shall mean a Participant using the Online Advice Service by accepting
Adviser's online investment service agreement or terms of use.
"Online Advice Service" shall mean Adviser's non -discretionary investment advisory service, Online
Advice, or its successor, as further defined in this Schedule.
"Opt -out Feature" shall mean a feature of the Managed Account Service selected by the Plan Sponsor
through which Participants, designated by the Plan Sponsor, are automatically enrolled in the Managed
Account Service, as further defined in this Schedule.
"Participant" shall mean an eligible participant, beneficiary or alternate payee who is eligible for the
Services.
"Plan" shall mean the employee benefit plan or plans or other compensation programs or arrangements
maintained by Plan Sponsor as listed in this Schedule (as the same may be amended in writing by the
parties from time to time). If more than one Plan is covered by this Schedule, any references herein to the
Plan shall mean each of the Plans, unless the context requires otherwise.
"Plan Administrator" shall mean the "administrator" of the Plan as that term is defined under Section
3(16)(A) of ERISA and Section 414(g) of the Code, or such comparable person responsible for the
administration of the Plan in the event the Plan is not subject to such ERISA or Code provisions.
"Rollout Date" shall mean that date on which Adviser has made all of the Services provided under this
Agreement available to Participants.
"Schedule" means this Investment Advisory and Management Services Schedule, including any exhibits
("Exhibits") attached hereto as of the Schedule Effective Date or hereafter as mutually agreed to in writing
by the parties.
"Services" shall mean the specific services with respect to the Plan covered by this Schedule (including
the Exhibits attached hereto).
"Subadviser" shall mean Morningstar Investment Management, LLC.
' * CilWNUALTA M 4 10
2.1 This Schedule sets forth the terms and conditions pursuant to which Adviser agrees to
provide Services with respect to the Plan. The terms and conditions of this Schedule are incorporated by
64
City Council 19 — 67 9/19/2023
reference into each Exhibit attached hereto, without regard to an express reference therein. Adviser
acknowledges and agrees that: (i) it is registered with the Securities and Exchange Commission as an
investment adviser under the Advisers Act, (ii) it is an investment adviser and fiduciary under the Advisers
Act and is a fiduciary under ERISA to the extent it provides Services to Online Advice Participants, and (iii)
it is an investment adviser and fiduciary under the Advisers Act and is an investment manager (as defined
under Section 3(38) of ERISA) to the extent it provides Services to Managed Account Participants.
2.2 The parties specifically agree that no provision of this Schedule or any Exhibit will require
Adviser to: (i) provide investment advice to Plan Sponsor or Plan Administrator; (ii) exercise any
discretionary authority or discretionary control with respect to the management of the Plan; or (iii) have or
exercise any discretionary authority or responsibility in the administration of the Plan, including the selection
of the Opt -Out Feature of the Managed Account Service (if applicable). Adviser has no discretion or
responsibility to interpret provisions of the Plan or to determine eligibility, participation, orthe right to receive
benefits under the Plan.
2.3 Adviser shall take appropriate actions and maintain policies and procedures reasonably
necessary to ensure Adviser does not engage in any nonexempt prohibited transactions under ERISA in
providing Services hereunder. Adviser's policies and procedures are designed to comply with applicable
law, including Department of Labor Advisory Opinion 2001-09A (and any modifications or amendments
thereto), pursuant to which Adviser has delegated certain obligations under this Schedule to Subadviser,
as described in Advisers Form ADV Brochure.
2.4 Adviser has authorized Empower Financial Services, Inc. ("EFSI"), an Affiliate of Adviser,
and its licensed agents and registered representatives who are Empower employees (collectively referred
to as "Agents") to solicit, refer and market Adviser's Services. In addition to their salary, such Agents may
earn bonus compensation based upon engaging plan sponsors to offer EAG's Services. Other Agents and
Adviser, representatives may be indirectly compensated through bonus compensation, in addition to their
salary, for communication, education and/or assisting Participants to enroll in EAG's Services.
Compensation paid to Agents or Adviser representatives does not increase the fees paid by the Plan and/or
their Participants.
2.5 Nothing in this Schedule is intended to constitute legal or tax advice from Adviser to Plan
Sponsor, or to any other party. Plan Sponsor understands that Adviser has not given and may not give
legal advice. All issues should be reviewed and discussed with Plan Sponsor's legal counsel and/or tax
adviser.
2.6 Empower's current Privacy Notice is provided as a part of this Schedule but shall not lessen
any of Empower's obligations regarding Personal Data hereunder.
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City Council 19 — 68 9/19/2023
3. RESPONSIBILITIES OF PLAN SPONSOR
3.1 Plan Sponsor or its designated agents shall be responsible for providing to Adviser
accurate data and information necessary to enable Adviser to perform the Services required under this
Schedule, including but not limited to, timely and reasonable notification of employer -initiated events, the
information, materials, Directions or rather data referenced in any Schedule, and the information reasonably
requested by Adviser to enable it to comply with federal law concerning Know Your Customer rules under
the USA Patriot Act, in such form and at such time as the parties mutually agree. Adviser reserves the right
to reject or return any documents, materials, or other information that are unreadable, corrupted, or which
Adviser is otherwise unable to process. Plan Sponsor agrees to provide or to assist Adviser in obtaining
all Participant data that is necessary to perform its duties under this Schedule, including but not limited to:
date of birth, income, gender, and state of residence. Plan Sponsor acknowledges that timely receipt of
appropriate information is a prerequisite to the performance of Adviser's Services and Adviser shall not be
liable for any delay or failure in the performance underthis Schedule due to Plan Sponsoes failure to comply
with the information submission deadlines established and communicated to Plan Sponsor by Adviser in a
timely manner.
3.2 Plan Sponsor or Plan Administrator shall make all discretionary decisions with respect to
the administration of the Plan relative to the Services and shall direct Adviser in accordance with such
decisions. Plan Sponsor shall be responsible for selecting and monitoring the Investment Options offered
through the Plan. In addition, Plan Sponsor agrees, for itself and on behalf of the Plan, that neither Adviser
nor Subadviser shall have any authority or responsibility under this Schedule for the selection or monitoring
of the Plan's Investment Options, or the provision of investment advice to Plan Sponsor with respect to the
Plan's Investment Options. Plan Sponsor acknowledges that Empower, as the Plan's recordkeeper, may
facilitate the use and awareness of the Services during the Plan enrollment process or as otherwise
requested by Plan Sponsor and Empower's call center may refer Participants to Adviser's investment
adviser representatives if the call concerns the Plan or their Plan account. Plan Sponsor understands and
agrees that, in the event the individual terminates or otherwise un-enrolls from the Managed Account
Service, such individual's account shall remain invested in the Investment Options as selected by the
Adviser or Subadviser prior to such termination or un-enrollment and that the individual or Plan Sponsor Is
responsible for any subsequent changes to the Investment Options.
3.3 Plan Sponsor shall be responsible for deciding whether to implement the Opt -Out Feature
of the Managed Account Service and determining which Participants shall be subject to the Opt -Out Feature
and direct Adviser with respect to such decisions. To the extent Plan Sponsor designates the Managed
Account Service as the default investment for the Plan, Plan Sponsor shall be responsible for selecting an
Investment Option for purposes of allocating individual accounts until such time as the Adviser begins
management of a Managed Account Participant's account; provided, however, in the event the individual
is not eligible for the Managed Account Service, such individual's account shall remain invested in the
Investment Options selected by the individual or the Plan Sponsor until the individual or Plan Sponsor
directs otherwise.
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City Council 19 — 69 9/19/2023
3.4 Under the terms of this Schedule, Plan Sponsor appoints Adviser as an investment adviser
or investment manager, as applicable. As an investment manager, Plan Sponsor Directs Adviser, without
limitation, to initiate with Empower buys, sells, reallocations or other investment transactions and to
calculate installment distributions, if applicable, under the Plan for Managed Account Participants. Plan .
Sponsor acknowledges and agrees that each Managed Account Participant will acknowledge Adviser at
the time of participation in the Managed Account Service. Any Managed Account Participant enrolled in the
Managed Account Service through the Opt -Out Feature or Plan default process will be deemed, by and
through the Plan Sponsor, to have so acknowledged Adviser by the Managed Account participant's
continued participation in the Managed Account Service after the applicable deadline by which such
Participant was required to have declined participation in the Managed Account Service. Plan Sponsor
understands and acknowledges that; (i)Adviser does not effect investment transactions and that investment .
transactions will be effected by the appropriate party or agent chosen by the Plan Sponsor, including the
Plan's trustee or custodian; (ii) Adviser will communicate, through Empower, information to initiate the
investment transactions to such parties; and (III) Empower will make available to Adviser the investment
transaction information related to the investment allocations directed by Adviser. Plan Sponsor also agrees
that transactions initiated by Adviser on behalf of Managed Account Participants shall not be subject to any
Plan limitations or corporate policy restrictions, such as blackout periods (other than a blackout period
applicable to all Managed Account Participants at the same time), preclearance requirements, or other
transaction restrictions, unless required by law.
3.5 Plan Sponsor acknowledges and agrees that it has received and read the supplemental
Adviser's Form ADV Brochure as required by Rule 204-3 of the Advisers Act.
3.6 Plan Sponsor understands and agrees that the Plan's Investment Options shall be held by
a custodian or trustee duly appointed by Plan Sponsor. Except with respect to the fee deduction described
in Section 4 of this Schedule, nothing contained herein shall be deemed to Direct Adviser to take or receive
physical possession of any of the assets of the Plan or to confer custody of such assets upon the Adviser
within the meaning of Rule 206(4)-2 of the Advisers Act. Adviser does not have any proxy voting or other
execution powers under the Plan, the Services, this Schedule or otherwise. Plan Sponsor has designated
a person or persons other than Adviser to vote proxies with respect to the Plan's Investment Options. .
3.7 Adviser shall be entitled to rely upon and act upon any instruction, certification, or Direction
received (whether in writing, orally, by telephone, voice response system, fax or other teleprocess, or by
other electronic means or other medium, including Internet or e-mail transmission, acceptable to Adviser)
from any person Adviser reasonably believes to be so authorized to provide such Direction. Adviser shall
have no duty to inquire or to question the accuracy or completeness of any data or Direction provided to it.
3.8 Plan Sponsor represents that the Plan is qualified under Section 401(a) of the Code, where
applicable, that the Plan Administrator has been duly appointed under the Plan, and that the person
executing this Schedule Is authorized to do so. Plan Sponsor shall be responsible for maintaining the Plan's
documents, including any amendments thereto based upon design modifications, for determining
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City Council 19 — 70 9/19/2023
operational compliance of the Plan with Plan documents, and, where applicable, for ensuring that the Plan
is qualified under Section 401(a) of the code and its related trust is tax-exempt under Section 501(a) of the
Code. Plan Sponsor will notify Adviser promptly if Plan Sponsor should learn of any facts or of any
regulatory action or prospective action which may result in the Plan ceasing to be qualified, where
applicable, under Section 401(a) of the Code. Plan Sponsor acknowledges that while Adviser may possess
and consult a copy of the Plan, trust agreement or related document(s), the possession or consultation of
those documents shall not alter or expand Adviser's responsibilities under this Schedule. If the Services
will be offered in a non -qualified plan, Plan Sponsor has reviewed the form of payment of Adviser's fees
and determined that it is appropriate given the design and operation of the non -qualified plan.
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City Council 19 — 71 9/19/2023
4. FEES & CHARGES
4.12 Adviser shall be entitled to compensation for the Services it provides in accordance with
the fee provisions set forth in Exhibit B-1 attached hereto. Fees will be deducted from the Plan's trust or
other funding vehicle, charged to Participant accounts, or invoiced to the Plan Sponsor as elected in the
applicable Schedule or as directed by Plan Sponsor. Plan Sponsor shall be responsible for determining that
fees paid are reasonable expenses of administering the Plan.
4.13 Plan Sponsor acknowledges and agrees the Managed Account Service fees will be
deducted directly from Managed Account Participant accounts in arrears. Plan Sponsor Directs Empower
to collect these fees on behalf of Adviser and to deduct fees from Managed Account Participant accounts
in accordance with the Service elections and fees described in Exhibit B-1 attached hereto.
4.14 Adviser may provide additional services pursuant to Direction from the Plan Sponsor. Any
fees for such additional services will be agreed upon by Adviser and the Plan Sponsor prior to the provision
of additional services.
5. PRIVACY
Adviser acknowledges that it is a "Financial institution," within the meaning of Regulation S-P, Privacy of
Consumer Financial Information, issued by the Securities and Exchange Commission ("Reg S-P") along
with the GLBA and other applicable federal and state laws. Adviser acknowledges and agrees that it
receives Personal Data which constitutes "personally identifiable financial information," within the meaning
of Data Protection Laws. Adviser has adopted a Privacy Notice, which will apply to Personal Data, that may
be amended from time to time.
6. FIDUCIARY INDEMNIFICATION
In addition to the Liability & Indemnification provision set forth In Section 9 of the Agreement, Adviser shall
also indemnify the Plan Sponsor from Damages to the extent resulting from Adviser's breach of its fiduciary
duties under ERISA with respect to the Services as described in this Schedule.
TERM & TERMINATION
7.1 Term. Either party may terminate this Schedule with ninety (90) days written notice to
the other party of its intent to terminate unless terminated in accordance with the applicable provisions of
Section 7.2 of this Schedule.
7.2 Termination. This Schedule shall terminate automatically in the following circumstances:
7.2.1 Either party notifies the other of that It has determined in good faith that the
Schedule is not consistent with its fiduciary duties under ERISA or applicable
federal or state law; or
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City Council 19 — 72 9/19/2023
7.2.2 The Agreement or the Recordkeeping Services Schedule between Plan Sponsor
and Empower terminates or expires; or
7.2.3 The agreement between Adviser and Subadviser terminates or expires and
Adviser is unable to contract with a suitable replacement to serve as a Subadviser.
7.3 Effect of Termination. As of the effective date of the termination of this Schedule, Adviser
will terminate Participant access to the Services and cease providing any Services to Participants. Plan
Sponsor will notify Participants, including Online Advice Participants and Managed Account Participants, of
the termination as soon as practicable. Adviser may assist Plan Sponsor in notifying Participants, Online
Advice Participants and Managed Account Participants regarding the termination of Services; provided,
however, to the extent Plan Sponsor requests such assistance, Adviser reserves the right to charge Plan
Sponsor all reasonable fees, costs or expenses incurred by Adviser in connection with the provision of such
assistance. Termination of the Schedule does not relieve Plan Sponsor or Managed Account Participants
of their respective obligations, if any, to compensate Adviser for Services rendered through the effective
date of such termination. If applicable, Adviser shall reimburse Plan Sponsor or Participants for any prepaid
amounts that relate to the provision of Services after the effective date of termination.
8. AGENTS
Plan Sponsor acknowledges that Adviser has delegated certain of its obligations to Subadviser and that
Adviser reserves the right, in its sole discretion, to replace Subadviser upon reasonable prior notice to Plan
Sponsor. In the event, the Subadviser terminates its agreement with the Adviser and provides advance
notice to the Adviser, Adviserwill notify the Plan Sponsor of such change as soon as reasonably practicable.
If the Subadviser replacement Is deemed unsatisfactory by the Plan Sponsor, the Plan Sponsor may
terminate this Schedule at any time in accordance with Section 7. Adviser represents that Subadviser is
not affiliated with Adviser or Empower and that Adviser has entered Into an agreement with Subadviserthat
includes representations that the Subadviser: (1) Is registered with the Securities and Exchange
Commission as an Investment adviser under the Advisers Act, and (ii) will maintain the required federal or
state investment advisory registrations that permit it to perform its obligations under its agreement with
Adviser, and (III) will act, at all times in providing the methodology and software for Adviser's Services, in
conformity with the requirements imposed upon Subadviser as an Subadviser under Department of Labor
Advisory Opinion 2.001-09A (and any modifications or amendments thereto), to the extent applicable to the
Services.
9. NOTICES
All formal notices required by this Schedule will be in writing and shall be sent to Adviser as set forth below
and to the most current Plan Sponsor and trustee address on file with Adviser. All notices sent shall be
effective upon receipt.
To Adviser:
rK
City Council 19 — 73 9/19/2023
Ken Verzella (or successor)
VP, Participant Advisory Services
Empower Advisory Group, LLC
8515 East Orchard Road
Greenwood Village, CO 80111
with a copy to:
Empower Advisory Group, LLC
8515 East Orchard Road
Greenwood Village, CO 80111
Attn: General Counsel
By signing this Schedule, the parties certify that it's to be to be executed by their respective duly authorized
officers as of the Schedule Effective Date.
By signing this Schedule, Plan Sponsor acknowledges receipt of the discretionary and non -discretionary
investment advisory fees disclosed in this Schedule, and the parties certify they have read and understood
it, they agree to be bound by its terms, and they have the authority to sign it. Each party agrees that this
Agreement and any other documents to be delivered in connection herewith may be electronically signed,
and that any electronic signatures reasonably believed to be genuine on this Agreement or such other
documents are the same as handwritten signatures for the purposes of validity, enforceability, and
admissibility. This Schedule is not binding on either party until signed by both parties.
EMPOWER ADVISORY GROUP, LLC
Signature
Ken Verzella
Printed Name
Vice President, Participant Advisory Services
Title
09/20/2023
Date Signed
71
CITY OF SANTA ANA
Signature
Printed Name
-.e /,-- —
Title
Date Signed
Signed
City Council 19 — 74 9/19/2023
EXHIBIT B-1:
DISCRETIONARY INVESTMENT ADVISORY AND NON -DISCRETIONARY SERVICES
The parties agree that the Services under this Schedule will commence upon a date as directed by the Plan
Sponsor and mutually agreed to by the parties, as administratively and operationally feasible.
1. GENERAL DESCRIPTION OF SERVICES
1.1 Adviser provides a full suite of discretionary and non -discretionary investment advisory
services to eligible Participants as selected by the Plan Sponsor. Such services may include set-up
services, communications, reporting, investment recommendations, and initiation of investment
transactions, subject to the terms and conditions of the Schedule and this Exhibit, as the same may be
amended in writing by the Parties from time to time.
1.2 As part of its Services, Adviser provides Participants access by telephone to the telephone
call center (investment adviser representatives available from 7:00 a.m. to 0:00 p.m. Central Time, Business
Days), and Adviser shall provide Participants, and designated representatives of Plan Sponsor, web access
to Plan and Participant account information, subject to periodic maintenance and system availability.
2. SERVICE ELECTIONS
2.1 Managed Account Service.
2.1.1 As further described in Adviser's Form ADV Brochure, the Managed Account
Service provides discretionary advisory services, consisting of personalized portfolios created by
Subadviser based upon the Investment Options available in the Plan, to Managed Account Participants.
The Managed Account Service allocates enrolled Participant accounts to personalized portfolios, and
automatically rebalances portfolio allocations If Adviser believes rebalancing to be appropriate.
2.1.2 Unless otherwise agreed to by the parties, Adviser will construct portfolios using
the Plan's core Investment Options ("Core Investment Options"), which are those Investment Options
selected for use in the Plan by Plan Sponsor that provide investment choices under the following asset
categories: Fixed Income/Cash, Bond, Large Cap, Small/Mid Cap, and International.
2.1.3 . Core Investment Options do not include any employer stock alternatives or self -
directed brokerage option alternatives. Unless the Plan Sponsor restricts Adviser from selling employer
stock held in an account managed by Adviser, Adviser will liquidate employer stock held in an account that
Adviser manages. The Plan must select and at all times maintain Core Investment Options that cover the
broad asset categories in order to utilize the Managed Account Service and the Online Advice Service.
Managed Account Participants may further customize their portfolio by providing additional information to
Adviser by phone or online and such information shall be considered by $ubadviser to determine portfolio
recommendations for the Managed Account Participant. Adviser shall periodically review and rebalance the
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City Council 19 — 75 9/19/2023
Managed Account Participant's portfolio.
2.1.4 A Managed Account Participant may cancel his or her participation in the Managed
Account Service by calling. Adviser's representative or through the website. Upon a Managed Account
Participant terminating participation in the Managed Account Service, the Managed Account Participant is
solely responsible for the investment of his or her Plan account.
2.1.5 Data requirements for Enrolling Participants.
2.1.5.1 Subject to the information below, if Adviser does not have required
indicative data for an Enrolling Participant, the Enrolling Participant will not be enrolled into the Managed
Account Service.
2.1.5.2 Plan Sponsor may provide Adviser with default data for use in processing
enrollments for Enrolling Participants, and in advising Participant accounts. If Plan Sponsor provides
Direction to use default data, such as income assumptions, Plan Sponsor agrees that use of such default
data is consistent with Adviser's execution of its fiduciary responsibility in providing investment advice to
Participants.
2.1.5.3 Gender Assumption. If gender information is missing on any Participant,
Plan Sponsor Directs Adviser to default gender assumption to female, unless Plan Sponsor otherwise
Directs Adviser, for purposes of processing Managed Account Service enrollment.
2.1.5.4 Date of Birth. If a Participant's date of birth is beyond the mortality tables
used by the independent financial expert, or the Participant's date of birth provided to Adviser is invalid, the
Participant will not be eligible to be enrolled into the Service.
2.2 Online Advice Service. Adviser shall provide access to the Online Advice Service to
Participants. For the Online Advice Service, Adviser shall provide non -discretionary advisory services,
consisting of Investment recommendations created by Subadviser based upon the Investment Options
available in the Plan, to Online Advice Participants. Online Advice Participants shall be responsible for
implementing the Investment recommendations. Beyond the initial recommendation, Adviser is not
responsible for providing additional investment recommendations or the management of an Online Advice
Participant's account. The Online Advice Service is only available through websites supported by Empower
and Subadviser. Managed Account Participants are not eligible for the Online Advice Service while
participating in the Managed Account Service.
3. COMMUNICATION AND ONGOING MAINTENANCE:
3.1 Enrollment. Plan Sponsor agrees that Adviser will conduct, (at no additional charge to
Plan Sponsor), an education/enrollment campaign as part of the rollout of the Services to all eligible
Participants and an annual campaign thereafter. The campaign materials will be provided to each
Participant and may include, but are not limited to a descriptive brochure, descriptive letter from Plan
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City Council 19 — 76 9/19/2023
Sponsor, enrollment form, follow-up communication and other appropriate materials. Participants can
enroll in the Managed Account Service through an online website (accessed through the Plan's participant
website or enrollment site), Adviser's investment adviser representatives orby returning an enrollmentform.
3.2 Ongoing Communications.
3.2.1 Communication and ongoing maintenance includes monitoring the use of
Services, and integrating Services communications into the Plan's overall communications campaign,
including enrollment materials, forms, web site, and group meetings.
3.2.2 As part of a Participant's enrollment in the Managed Account Service, the
Participant will receive the Managed Account Service welcome kit shortly after enrollment. The Participant
will receive an annual kit shortly after their birthday. Each kit provides the participant an update on their
account and reaching their retirement goals. Standard materials may include a discussion of Services in
enrollment/education materials, printlemail communications specific to the Services, on the website, and/or
in personalized Participant materials. Additional or custom Participantcommunications materials may be
used by Adviser and may be paid for by Adviser, Empower or the Plan Sponsor. Such additional or custom
communications may include targeted marketing techniques based upon participant demographical and/or
account data (including but not limited to age, income, deferral rates, current investment elections) to
identify Participants who may benefit from participation in the Managed Account Service.
4. ADVISORY AND PORTFOLIO MANAGEMENT SERVICES FEES
Managed Accounts per Participant Annual Fee
_
Account
Balance
Managed Account
Annual Fee
First $100,000 of account balance
0,45 %
Next $150,000, up to $250,000 account balance
0.35 %
Next $150,000, up to $400,000 account balance
0.25 %
Amounts greater than $400,000
0.15 %
For example, if a Participant's account balance subject to the Managed Account Service is $50,000,
the fee is 0.45% of the account balance. If the account balance subject to the Managed Account
service is $500,000, the first $100,000 will be subject to a fee of 0.45%, the next $150,000 will be
subject to a fee of 0.35%, the next $150,000 will be subject to a fee of 0.25%, and amounts over
$400,000 will be subject to a fee of 0.15%.
S. ADDITION OF NEW PLANS
Tax -deferred plans not listed at the top of this Schedule B that are added to Plan Sponsor's program after
the Effective Date will not be included In this Agreement, and will be subject to additional fees.
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City Council 19 — 77 9/19/2023
6. LIMITATIONS AND INVESTMENT OPTION CHANGES
Services will have limited capabilities for purposes of enrollment, rebalancing or reforecasting for up to ten
(10) business days following changes to the investment option lineup. Other functionality will be available
during this time. Adviser and Subadviser need to conduct anew analysis of the available Investment Option
array to accommodate these changes. This analysis will take approximately 10 business days, during which
time, Online Investment Advice, and the Managed Account Service will not be available for Participant use.
Once the analysis is complete, Online Investment Advice and the Managed Account Service will once again
be available.
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Rem 1—Cover Page
EXHIBIT B-2:
EAG ADV BROCHURE
EMPOWER ADVISORY GROUP LLC (EAG)
Formerly lmo n as ADVISED ASSETS GROUP, LLC
Dhabsum Brochum far:
Online MyRe &
Managed Axeuns Servla
8515 East Orchard Road
Greenwood Mllage, CD B0111
Telephone: 855-756-4788
August 1, 2022
This Brochure provides information about the qualifications and business practices of Empower Advisory Group,
LLC (EAG). SpedBwlly, this Btoahure Ven4d.s Informatm on the advisory oei ices provided by EAG and sub-
Mms of by Morningstar Investment Management, LLC (M orningstar Investment Management). If you have any
questions about the contents or this Brochure, please contact us at 855-756-4738. The information in this Brochure
has not been apprwad or verified by the Securities and Exchange P mmissloo (SEC) or by any state aecptltias
authority.
EAG Is a resrstered invesment adviser under the Investment Advisers Act of 1940 (Advisers Act). Regismabon of
EAG does not Imply any level of skill or training. Additional Information about EAG is available on the SEC waba to
at www.adviserinfosa,gp or on EAG's websita at www.emoower.com/eae.
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horn 2 — Material Changes
This section of the Brochure highlights and discusses any changes that were made since the Adviser's last annual
update. The Brochure has been updated to reflect the febranding changes of the Adviser and its affiliates that
became effective on August 1, 2022.
Additional information about EAG is also available via the SECS web site www.adviserinfo.sec.eov. The SEC's web
site also provides information about any person afflllated with EAG who is registered, or are required to be
registered, as an investment adviser representative with EAG.
City Council 19 — 80 9/19/2023
Item 3 - Table of Contents
Item 1- Cover. Page ............... ........................................................................................................................................ 1
Item2-Material Changes.............................................................................................................................................2
Item3 -Table of Contents............................................................................................................................................3
Item4 - Advlsory Business............................................................................................................................................4
Item 5 - Fees and Compensation..................................................................................................................................8
Item 6 - Performance -Based Fees and Side -by Side Management........................................................................... 10
Item7 -Types of Clients ......................... .-......... .......................................... ............................................................... 10
Item 8 - Methods of Analysis and Investment Strategies and Wall Loss................................................................. 10
Item 9 - Disciplinary Information............................................................................................................................... 13
Item 10 - Other Financial Industry Activities and Affillations.................................................................................... 13
Item 11 -Code of Ethics, Participation or Interest In Client Transactions and Personal Trading ............................... 16
Item12 - Brokerage Practices..................................................................................................................................... 17
Item13 - Review of Accounts..................................................................................................................................... 17
Item 14 - Client Referrals and Other Compensation................................................................................................... 18
Item 15 -Custody....................................................................................................................................................... 19
Item16 - Investment Dlscretlon................................................................................................................................. 19
Item 1.7 -Voting Client Securities ........ ................................... ................................................................ ...... ,............. 19
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Item 4 — Advisory Business
Description of Advisory Firm
EAG is a registered Investment adviser under the Advisers Act since 2000. It submits notice filings With state
securities divisions in all 50 states, the District of Columbia, Guam, US Virgin Islands, and Puerto Rim. EAG offers
Investment management and advisoryservices primarily to plan sponsors of employer -sponsored retirement plans
such as 4O1(a), 401(k), 4O3(b) and 457 plans, Including government entities and their participants, and toall account
holders of the Empower Premier IRA and Empower Managed Portfolio accounts. EAG also offers Investment
management services to retail brokerage account holders. EAG does not choose the investments offered in
employer -sponsored retirement plans. EAG serviced plans receive recordkeeping services through Empower
Retirement, LLC (Empower), the recordkeeping entity affiliated with EAG. More information about EAG's services,
including an applicable brochure, can be obtained by contacting EAG atthe number provided on the cover page of
this Brochure or by visiting EAG's website at www.empower.com/eag. EAG's principal place of business Is
Greenwood Village, CO.
EAG Is a wholly owned subsidiary of Empower Annuity Insurance Company of America (EAIC), an insurance company
domiciled in the State of Colorado. EAIC is a direct, wholly owned subsidiary of Empower Holdings, Inc. (EHI), a
Delaware holding company. EHI is a direct wholly owned subsidiary of Great -West Lifeco U.S. LLC. (Lifeco U.S.) and
an indirect wholly owned subsidiary of Great -West Lifeco Inc. (Lifeco), a Canadian holding company. Lifeco is a
subsidiary of Power Financial Corporation (Power Financial), a Canadian holding company with substantial Interests
in the financial services industry. Prover Corporation of Canada (Power Corporation), a Canadian holding and
management company, has voting control of Power Financial. The Desmarais Family Residuary Trust has voting
control of Power Corporation, through a group of private holding companies that it controls.
Types of Services
EAG provides a range of direct account holder -level and participant -level investment services as well as services
provided indirectly through private -label arrangements with institutional partners (the Services). The Services
Include Online Investment Guidance (OIG), Online Advice (OA), and the Managed Account service (MA Service) or
My Total Retirement (MTR). Other services that may be available to clients include Spend -Down Advice, Financial
Planning Service and Retirement Income Projection Tools and Services. EAG provides its Services through a
proprietary, computer -based software program that is developed and maintained by Morningstar Investment
Management.
In addition, EAG provides sub -advisory and technology services to outside adviser firms through a service called
Advisor Managed Accounts (AMA). This service enables the AMA firms to offer their own investment advisory and
management services within retirement plans serviced by Empower. The total sub -advised assets as of December
31, 2021, for this service totaled S1,929,645,216.
Thera is no guarantoo provided by any partythat participation in any of the advisory services will result in a profit.
Morningstar Investment Management LLC
Morningstar Investment Management is a registered investment adviser wholly owned by Morningstar, Inc. and is
not affiliated with EAG or any company that is affiliated with EAG. Morningstar Investment Management is located
In Chicago, Illinois. A copy of Its Form ADV Part 2A brochure may be obtained at www.advlserinfo.sea.gov.
Morningstar Investment Management serves as an Independent financial expert (IFE) in accordance with the
Department of Labor SunAmerim Advisory Opinion 2001-O9A, dated December 14, 2001(the SunAmerica Opinion).
Morningstar Investment Management uses Its proprietary methodology to evaluate the available investment
options line retirement plan and redevelop an Individualized investment strategy for plan participantsand account
holders. The plan, plan sponsor or plan fiduciary must select and continuously maintain frwesbnent options that
cover broad asset categories. The Investment options selected for the plan generally consist of a broad range of
asset classes. More information Is provided under Item 10 —Other Financial Industry Affiliations. Item 8, Methods
of Analysis and Investment Strategies and Risk of Loss discusses the general risks of investing. The risks associated
City Council 19 — 82 9/19/2023
with the Investment options can vary significantly with each partiouIar Investment category and the relative risks of
categories may change. Accordingly, EAG may make changes from time to time regarding the avallahlllty of certain
Investment options. The fees, risks, responsibilities of plan sponsor/plan provider/participant and limitations for
each of these services are discussed In greater detalI below. Fees and expenses are also explained In the respective
prospectus, which accompanies each lnvestmentoption; as applicable.
Certain EAG's Services rely on Morningstar Investment Management's proprietary methodology, which Is based on
a review of available quantitative data to analyze and screen the Investment options within a plan. Morningstar
Investment Management also applies qualitative analysis by Investment professionals, such as evaluations of
Investment managers, portfolios, and individual Investments. The primary sources of Information used by
Morningstar Investment Management are the extensive databases and methodologies of Morningstar Investment
Management. and/or Its affillates, and Interviews with Investment managers. Other sources include financial
publications, annual reports, prospectuses, press releases, and SEC filings. Morningstar Investment Management
combines this Information with other factors — Including actuarial data, stockmarket exposure, probability analysis,
and mean -variance optimization — Into Its proprietary software program to analyze a complex set of market data
and variables. The result is an advanced model capable of providing investment recommendations and projections
of different outcomes. Using this model, Morningstar Investment Management develops an Investment strategy
tailored to your Investment goals.
Online Investment Guidance
EAG's OIG service developed by Morningstar Investment Management provides participants in participating plans
with access to sophisticated but easy -to -use online amount planning, advisory, and analytical tools that assist the
participant in selecting their own asset classes and building a diversified portfolio. Using OIG, participants are
provided with general asset allocation Information based on the investment options that are available within the
participant's plan. In addition, with Old, a participant can receive an objective savings rate recommendation that
may assist in achieving his/her retirement goals. OIG does not provide fund -specific recommendations. The services
provided under Online Investment Guidance do not constitute investment advice under the Investment Advisers
Act of 1940.
2. Online Advice
OA Is based on the software program developed by Morningstar Investment Management. It provides the
participant with retirement goal forecasting advice and fund -specific asset allocation recommendations tailored to
the specific participant's financial situation and retirement goals. OA is tailored for individuals who wish to manage
their own retirement account with the assistance of the service tools and investment advice.
OA provides participants with a retirement goal forecast through various assumptions and hypothetical financial
and economic scenarlos. These scenarios are based on factors such as historic returns, market volatlllty, cross -
correlations, calculated risk premiums, interest rate fluctuations, Inflation, and market conditions; all of which have
limitations. The participants can interact with OA to see howchanges in their decisions about their savings, expected
retirement age, level of investment risk and retirement Income goal may affect the system's forecast. Participants
who enroll in OA are responsible for determining the portfolio allocation that is best suited for their needs and
investment strategy.
The investment recommendations. provided by OA are limited to the available investment options within the
participant's specific retirement plan. OA does not make any recommendations about investing in any individual
stocks or other asset classes, including employer stock that may be an investment option under the participant's
retirement plan.
Participant Responsibilities
Participants are responsible for making their investment decisions and may implement OA recommendations either
online or by phone. Participants are also solely responsible for reviewing and updating the information they input
City Council 19 — 83 9/19/2023
In the OA service with respect to the completeness, accuracy, and timeliness of the Information. Participants should
review their retirement accounts periodically to monitor changes In the market and the value of their I mestments.
A failure by an Individual to review and update their account Information through OA may materially affect the
content end value of the service.
Limitations on the online Investment Guidance and the Online Advice Services
The recommendations provided through OA and the information provided through OIG are estimates based on the
responses and Information provided by the participants. Neither FAG nor Morningstar Investment Management
make any guarantees or warranties, express or Implied, as to the accuracy, timeliness, or completeness of such
Information. The OIG and OA services are also subject to the general market and financial conditions existing at the
time of use.
The retirement goal forecast and Investment recommendations provided by OA and the Information provided
through OIG are not a guarantee of future results, nor are they a guarantee that a particlpant will achieve their
retirement goals. OA and OIG should only be used by partidpants as a tool In their retirement planning and not as
a substkute for their own Informed judgment. Neither FAG nor Morningstar Investment Management has an
obligation to update any information for a specific Individual or to proactively contact the individual to obtain
updated Information. A failure by an Individual to review and update account information through OA and OIG may
materially affect the content and value of services received from FAG.
3. Managed Account Service
EAG offers a discretionary managed account service (Managed Account, MA service or Mill). This is a professional
and Flexible asset management program based on data resulting from the methodologies and proprietary software
program developed and employed by Morningstar Investment Management. In the MA service, EAG has
discretionary authority over the allocation of available investment options, without prior participant approval of
each transaction. All ongoing investment transfers and investment directlon changes are implemented for
Individuals enrolled In the MA service.
The MA service designs a specific asset allocation portfolio for the participant that reflects the Individual's
retirement goals, IHe stages, specified risk constraint and overall financial situation. The MA service considers plan
assets and other assets and Investments not Included within the plan If provided by the participant.
On a periodic basis, Individual accounts In the MA service are re forecasted, which may Include rebalandng and
reallocating the IndNldual's asset allocation portfolio. This Is done to maintain alignment with the allocation
percentage, determined by Morningstar Investment Management through various assumptions and hypothetical
financial and economic scenarios. Such scenarios are based on different factors such as historic returns, market
volatility, cross correlations, calculated risk premiums, Interest rate fluctuations, inflation, market conditions, and
the personal financial circumstances of the participant. Particlpants receive an account update and forecast
statement annually and can update their personal Information at anytime by calling EAG at their plan's toll -free
customer service number, or by visiting the appropriate vueosite. Some plan providers may offer a guaranteed
lifetime benefit withdrawal option to plan participants who are approaching retirement or are In retirement. IF the
plan provider offers this service end If the pa rticipart meets the retirement criteria established by the plan provider
or plan sponsor, the investment strategy may include a suggested amount that ca n be withdrawn while maintaining
Income throughout retirement. It may also include Information about allocating a portion of the managed account
balance for the purchase of an annuity or ther guaranteed Income product.
Limitations err the Managed Accounts Service
When participants enroll in the MA service, they must transfer and allocate their entire retirement account balance
to the Managed Account. For participants, there is an exception of employer stock and employer directed monies.
Partial are nxgementof participants' accountwhere they are invested in other investment options (such as individual
stocks or other asset classes outside of the available investment options) while also participating in the MA service
City Council 19 — 84 9/19/2023
Is not an avallable alternative. Participant balances In any of these Investment options must be Ilquldated, subject
to plan and/or Investment provider restrictions, or the participant cannot be enrolled In the MA service. For
participants, certain outside non -advisable assets may bepermitted while also participating In the MA service.
However, the participant's entire advisable account balance must be allocated to the MA service.
Once enrolled In the IVIA service, participants delegate certain n account management functions to EAG Including
functionality for fund -to -fund transfers, change fund allocations, the dollar cost averaging tool and/or the
rebalancer tool. However, Indti duals In the MA service retain full Inquiry access to their amounts and may still
request approval for loans or take a distribution withdrawal, if permisslble. Participants may un-enroll at anytime
from the MA service. Once they do so, the participants resume full responsibility for the Investment management
of their accounts. An individual may tin -enroll online or by contacting an EAG Investment adviser represenfative.
4. Spend -Down Advice
Participants who are enrolled in any of EAG's F&rvices discussed above are also provided with an additional feature
of Spend -Doom Advice which includes retirement planning tools, The Spend Down Advice illustrates how long the
:..... desired income may last in retirement and determines how much spendable income the participant may be able to
sustain throughout their retirement. The Spend -Down Advice provides both the amount andsourcesof income
available throughout their retirement. The services provided under Spend -Down Advice provide projections of
spendable income and do not constitute investme nt advice under the Investment Advisers Act of 1940.
S. Retirement Income Projection fools and Services
SAG may offer online tools and services for participants to convert projected or actual retirement savings Into
estimated monthly retirement Income. This interactive retirement planning service consists of various retirement
Income projection tools. These tools are m1a, natlonal in nature, do not reflect actual Investment: results, and are
not guarantees of future results. These tools do not constitute investment advice under the. Investment Adviser;
Act of 1940.
Enrollment in EAG's R andons
Plan prorlders and plan sponsors select the Service(,) (Le., OA, 010, and/or the MA service) that a re made avallable
to plan particlpants and how participants can authorize the Seraice(s). Participants roust agree to the terns of a
user agreement (Terms of Service). Terms may be amended by EAG from time to time, to allow continued use of
any of the Services. As parrots participant's enrollment In the MA service, the participant receives a MA Welcome
KIt shortly after enrollment. The participant addltlonally receives an Annual Kit, each year. Each kit provides the
participant an update on their account and information on reaching their retirement goals.
In certain Instances, Plan Sponsors may authorize EAG to enroll particlpants automatically In the NIA servI m based
on Information provided to FAG by the plan Sponsors. In such Instances, current particlpantsin the Plan receive the
Terms of Service and are given a defined period. of tune in which to cancel or opt -cut of theMAservice without
Incurring an advisory fee (the Free Period or Promotional Period)..Pards.lpi nts' automatic enrollment In the Service
by the Plan Sponsors Is based upon personal financial information provided bythe PlanSponser, Including date of
birth, salary, gender, and state of residence. Participants may review this Information online or by contacting an
EAG investment adviser representative. ParticXpants are. solely responsible .for reviewing the personal flnanclal
information they or their Plan Sponsor provide, and for notifying EAG of any changes or updates. Participants who
are eligible for their amployeraponsored retirement plan or that otherwise elect to opt -in after the Free Look or
Promotional period concludes, may not be eligible for a waiver of advisory fees that Is otherwise available In the
Free Look or Piomotloual Period. -
The advice and recommendations provided through the Services are based on the responses or other Information
provided by or about the. participant by the Plan Sponsor and/or the participant Neither EAG nor Morningstar
investmentManagement make. any guarantees or warranties, express or implied, as to the accuracy, timellness, or
City Council 19 — 85 9/19/2023
completeness: of such information. The Services are, also subject to the general market and financial conditions
existing at the time of usage. The retirement goal forecast. rand Investment advice recommendations are not a
guarantee of future results and are not a guarantee that a particular person will achieve their retirement goals.
Termination of Services
Participants may cancel their participation in OA or.the MA service at any time. Participants utilizing OA must
cornplete their cancellation online. Participants utilizing. the, MA service may cancel online or by calling an EAG
Investment adviser representative at the toll -free customer service number.
After cancellation ofthe: - -'
1. OA service, the individual will no longer have access to the online Investment recommendations. Because
EAG does not effect changes to the participant's/account holder's asset allocation and account balances,
the individual's balances will not be affected unless and until the individual affirmatively changes their
assettallocation and balance after the cancellation of OA -
2. MAservice; the participantwill havetheabilltytomake.allocation and investment option changes to their
account,, usually one to two business days following cancellation. Accordingly,the participant's; asset
allocation will remain the same as established in theMAservice unless and until the participant
affirmatively changes his/her asset allocation after cancellation of the MA service.
Participant Information
The use and storage of any information Is provided at the Individual's sole risk and responsibility. Such information
Includes, without limitation, an. individual's .personal and non-public information, amount number, password,
Identification, portfolio Information, amount balances and any other Information available an an individual's
personal computer. The Individual Is responsible for providing and maintaining the communications equipment
(including personal computers and modems) and telephone or other services required for accessing and using
electronic or automated services, and for all communications service fees and charges Incurred by the Individual in
amassing these services. EAG shall not bear any responsibility for either errors or failures caused by the malfunction
of any computer, communication systems, any computer viruses, and related problems that may be associated with
the use of the Services.
Assets Under Management
With respect to the services provided by EAG, as of December 31, 2021:
Discretionary investment management Among all services:
$75,081,939,787
Non -discretionary investment advisory services among all services
$7,994,058,511
in the amount of: -
Tomldlscretlonaryendnon-discretionary Investment management
$931O75,998,298
and advisory services In the amount of: - -
Item 5 - Feesand Compensation - - - -
- For employer -sponsored retirement plans, fees are subject to negotiation by the plan sponsocwhlch may Include
plan -level pricing credits depending on the various optlon(s)-selected by the plan for Its participants.' In some
Instances, If agreed'to by the 'plan, the plan sponsors or recordkeeper' may 'pay EAG's fees on behalf of plan
participants. EAG resbNes the rightto offer discounted fees or other promotional pricing or to waive fees for any
particular peridd'tN time subjectto proper notification and disclosure.
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City Council 19 — 86 9/19/2023
1. Online Investment Guidance Service Fees
There is no fee for pargcfpants. using OIG. -
2. Online Advice Service Fees
There is no fee for participants us! ng OA.
3. Managed Account Service Fees - -
Participants may be charged a fee for the MA service based on the Terms of Service with the participant
and/or the plan sponsor's agreement with EAG, EAG may offer plans tiered pricing schedules based on the
enrollment method the plan uses for offering or enrolling Its participants In the MA service. Such options
Include, but are not lintitedto, pricing schedules based on the plan sponsor's selection of an opt -out versus
opt -in enrollment methodology; Applicable pricingschedules for each of the options are made available to
the plan sponsors, which they may use to select the option for their employer -sponsored retirement plan.
Pursuant to the.Terms of 5evice and/or the plan sponsor's agreement with .EAG, the fee for the MA service
- is based upona percentageofassets managed. The applicable fee forthe Managed Accountservicevarfes.
It is fully disclosed to participants prior to or at the time of enrollment within the enrollment disclosure
materials, In addition, the fee is disclosed to participants in the Terms of Service when the participant
enrolls in the MA service. The maximum annualized fee that may be chargedto a participant is 0,65%of
the participants account balance.
The advisory fee is debited from the participant's account following each applicable billing period. If a
participant cancels enrollment in the MA service at anytime within a given billing period, pursuentto the
participant's Terms of Service and/or the plan sponsor's agreement with EAG, the participant's fee is based
upon a percentage of assets managed during the billing period. The fee will be debited from the
participant's amount or paid by the plan sponsor according to EAG's agreement and procedures. lfthe plan
sponsor terminates its service agreement with the plan's record keeping service provider, the participant's
advisory fee is debited as of such date of termination or paid by the plan sponsor according to EAG's
agreement and procedures.
4. Retirement Income Projection .Toalsand Services -
EAG does notcharge a fee to plan sponsors or participants For the retirement Income projection tools and
services. -
5. Other Fees and Expenses---- -
In addition to any previously negotiated and disclosed recordkeeper fees, commission payments and other
administrative servicing fees and expenses for each'plan, EAG may pay cash compensation or referral fees
to unaffiliated firms for soliciting and referring plan sponsors and their participants to enroll In EAG's MA
service. '-
Accounts invested in mutual funds; separate accotmts, collective investment alternatives and other
Investments may be subject to other investment fees. Fees such es Fund operating expenses or redemption
fees may be fmposed,at the Investment company level. Information about the fees Imposed by specific
Investment choices Is available In the fund prospectuses or offering memoranda for the securities. EAG
may allocate member assets to funds or investment alternatives with these fees or costs. All securities
transactions that occur as a result of the services provided by EAG as described in this Brochure are
executed by Empower Financial Services, Inc., (EFSI) for which it may receive compensation in the form of
12b-1 fees or other compensation from mutual fund companies or from the other Investments that may
be available as program investment options.
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City Council 19 — 87 9/19/2023
A participant will pay advisory fees to EAG for the MA service and Indirectly to ECM If Empower Funds are
Included In the retirement plan Investment options. The fees paid to ECM for management of the Great -
West Funds are Included In the fund share price.
Item 6 — Performance -Based Fees and Side —by Side Management
EAG does not charge any performance —based or side -by side management fees.
Rem'f—Types of Clients
EAG provides Investment advice to participants In their retirement plans for which Empower provides
recordkeeping services. Members typically must be considered residents of the United States, the U.S. Virgin
Islands, Guam, or Puerto Rico. The plan sponsor may apply additional restrictions for participation due to plan or
regulatory requirements.
Item 8- Methods of Analysis and Investment Strategies and Risk of Loss
The Services described in this Brochure are based on the proprietary asset allocatlon and retirement Income
projection methodologies developed by Morningstar Investment Management. The development of Investment
advice. by Morningstar Investment Management Involves the Investment methodologies across the products and
services described herein. Morningstar Investment Management or Its afflllates focus on specific Investment areas
such as capital market assumptions and a valuation -driven approach to asset allocation.
Analysis Methods
In providing advisoryservices, Morningstar Investment Management reviews avallablequantitative data to analyze
and screen the Investment options within a plan. The portfolios are typically constrained to a set of investment
options defined by our client, which may Include their affillated Investment products. The analysis will Include
quantitative analytics and fundamental research on the Investment options available. Morningstar Investment
Management draws on Morningstar's comprehensive database of fund and security analytics.
Once the avallable data is identified, Morningstar Investment Management processes the data using a series of
optimization routines. These optimization routines serve as a blueprint for how the asset classes are combined to
help achieve an optimal portfolio for a given level of risk. The model portfolios include both equity and non -equity
asset classes that am chosen be represent a broad range of Investment categories available in a plan sponsor's
retirement plan menu. The asset allocation process requires that there be significant benefit (generally through
Increased diversification) to adding the asset class to the model portfolios. In addition, Investment options within
the Investment/plan menus must provide significant exposure to the desired asset class In order to be selected. The
asset classes that are ultimately used will depend on the available Investment options that are considered for the
construction of the fund -level model portfolios, In other words, Morningstar Investment Management will only
recommend assetdasses thatcan be fulfilled byan Investmentoptlon or combination of investment options within
the plan.
Investment Strategy
If accumulating for retirement, the Investment strategy is generally based on Information such as retirement
account balances, expected retiement age, savings rate and other preferences provided by the Individual. If you
have already retired, and if the plan provider offers a guaranteed lifetime withdrawal benegt program, the
Investment strategy is based upon account balances, additional cash flows, and life expectancy. Thls retirement
strategy may include some or all of the following:
• Retirement Income Goal (accumulation phase): The retlnernent Income goal Is the projected amount of
money after tax that will be needed by the Individual throughout retirement. This calculation can be based
on current income, adjusted to reflect the estimated dollar value at retirement age. Typically, a good
starting place is 75%of salary (although some plan providers may request a different rate, e.g., 80%of
gross pay), and then the Services project the after-tax value of thatamountat retirement age to determine
10
City Council 19 — 88 9/19/2023
a retirement Income goal. The Individual has an option to change this projected retirement Income
amount.
• Income Outlook (acoumulation phase): The Income outlook is a projection of the annual Income that the
individual may receive during retirement. This is based on an annualized view of the accumulated
investment wealth, combined with social security benefits and any pension or other Income provided to
EAG.
• Total Retirement Income (in -retirement phase): If your plan provider or plan sponsor offers the in -
retirement services, total retirement income is the projected amount of money, that one can expect to
receive on anannual basis in order to maintain income throughout retirement.
• IMPORTANT: When Morningstar Investment Management determines the income projections described
above, these projections are based on hypothetical performance data and do not represent actual or
guaranteed results. Your projections may vary over time with each additional use of the service.
Risk Strategy
Morningstar Investment Management determines a risk strategy based on several factors, such as current age and
time until retirement, gender, salary, total current wealth, deferral rate, and retirement goo Is. If the individual can
purchase an annuity and has retired or Is approaching retirement, the risk strategy also considers longevity and
liquidity needs. I he risk level corresponds to an asset mix, or the combination of mutual funds, commingled funds,
separate accounts, exchange -traded funds, and cash alternatives, which will serve as the basis for the
recommendations of specific funds appropriate for the individual.
Estimated Tax
Morningstar Investment Management estimates federal, state income, and capital gains taxes based on marginal
tax rate calculations. These calculations are used when Morningstar Investment Management conducts income
simulations. Tax data is updated annually based on the United States Internal Revenue Code flRC) and similar state
tax data. Morningstar Investment Management uses income data for the inc lvidual and their spouse/partner to
esthnate federal and state tax exposure. The tax exposure is appropriately reduced for pre-tax deferrals, tax-
: - deferred capital gains, and yield and distribution of Roth proceeds. Based on the Information that the individual
provides, Morningstar Investment Management provides an estimate of the tax exposure but may not include all
tax considerations. Please consult a tax adviser for a complete understanding of your tax situation.
General Risks of Investing
.. _. Investing in securities involves risk of loss that clients should be prepared to bear. Neither EAG nor Morningstar
Investment Management or their affiliates guarantees that the meommendations wfll result In achieving the
retirement income goal. Neither EAG nor Morningstar Investment Management or their affiliates can guarantee
that negative returns can orwlll be avoided In any of tho recommendations. An Investment's future performance
may differ substantially from its historical performance and as aresult, may incur a loss. Pest performance is no
- - - guarantee of future results.Additionally, the plan provider may make changes from timatotimewhh respect to
the investment options available in the pima. -
You should carefully consider the benefits of a well-balanced and diversified investment portfolio. Market or other
economic conditions that cause one category of assets to perform very well often cause another asset category to
perform below average. Diversification does not guarantee Investment returns and does not eliminate the risk of
Ions.
Below are some of the common factors that can produce a loss Ina client's account and/or in specificinvestment
product or asset category:
11
City Council 19 — 89 9/19/2023
Market Risk: Stock and bond markets are volatile and can decline significantly in response to adverse Issuer,
political, regulatory, market, or economic developments in the U.S. and in other countries. Market risk may
affect as Ingle company, a sector of thee conomy, a country or geopolitical region, or the market as a whole.
Market risk may impact stock and or bond markets in unanticipated and different ways.
Business Risk: These risks are associated with particular Industry or a particular company within an
Industry.
Capitalization Risk: Small -cap and mid -cap companies may be hindered due to limited resources or less
diverse products or services, Their stocks have historically been more volatile than the stocks of larger,
more established companies.
Category or Style Risk: During various periods of time, one category or style may underperforn or
outperform other categories and styles.
Credit Risk: The risk that the Issuer of a security may be unable to make Interest payments and/or repay
principalwhen due. A downgrade to an issuer's credit rating or a perceived change In an Issuer's financial
strength may affect a security's value and impact the performance of the Issue — along with any mutual
fund or exchange -traded fund which holds it.
Interest Rate Risk: The market value of debt security Is affected significantly by changes in Interest rates.
When interest rates rise the security's marketvalue declines. When Interest rates decline, marketvalues
rise. The longer bond maturity results In the greater the risk and the higher yield. Conversely, the shorter
bond maturity results in the lower risk and the lower yleld.
Inflation Risk: When any type of Inflation Is present, purchasing power may be eroding at the rate of
inflation.
Reinvestment Risk: The risk that future proceeds from Investments may have to be reinvested at a
potentially lower rate of return (i.e., Interest rate). This relates primarily to fixed Income securitles.
+ Exchange -traded funds: Exchange -Traded funds present market and liquidity risks, because they are listed
on a public securitles exchange and are purchased and sold via the exchange at the listed price. The price
- - - will vary based on current market conditions and may deviate from the net asset value of the exchange -
traded fund's underlying portfolio. There may also be an Inactive market for certain funds, and/or losses
from tradingin secondary markets.
• Target Date Funds:Generally, the asset allocation of each targetdate fund will change an anannual basis
with the asset allocation becoming more conservative as the fund nears the target retirement date. The
target date Is the approximate date when Investors plan to start withdrawing their money. The principal
:: -.... value of the funds) In a plan's lineup Is not guaranteed artery time, including at the time of target date
and/or withdrawal.
An investment In a money marketfUnd is not insured or guaranteed by the FDIC or any other government agency.
:. Although some money market funds such as U.S. Government money market funds strive to preserve the value
of the Investment at $1.00 per share, ii Is possible to lose money, by Investing in a money market fund.
Additionally, other money market funds may operate under new rules and regulations permitting them to have
.. a ficadng value per share. A floating value may be more or less than $1..00 per share depending on market
conditions and impose liquidity/redemption fees is large or frequent withdrawals.
For more complete Information about any of the mutual funds or Investment product available within the
retirement plan, please contact your retirement plan service provider.
Risks Asserclated with particular Types of Securities
.. Neither LAG nor its sub -advisers recommend a particular type of security. The plan sponsor or Its agent Is
responsible for determining the retirement plan's menu of Investment options. It is the participant's responsibility
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City Council 19 — 90 9/19/2023
for reading alLdfsclosure and relatedmaterials, fncludlno prospectuses, statements of add Itlonal Information and
other similar material .
Item 9— Disciol Ina ry Information
Registered Investment advisers are required to disclose all metorleI facts regarding any legal or disciplinary events
that would be material to your evaluation of EAG or the Integrity of EAG's management. EAG has no legal or
disciplinary event to report relative to this Item.
Item 10— Other Financial lndustry Activities and Affiliations -
EAG is note registered broker -dealer. However, due to the organizational structure of EAG's parent company, EAIC,
certain registered representatives of EFSI are also supervised persons of EAG and are required to comply with EAG
policies and procedures when acting In that capacity. EAG and Its management persons -are not registered as a
futures commission merchant, commodity pool operator, a commodity trading advisor, or an associated person of
the foregoing entities.
Recordkeeping and Administrative Services Company _
Empower Retirement, LLC(Empower) is a comprehensive administrative and recordkeeping services provider for
financial Institutlons and employers, which include educational, advisory, enrollment, and communication services
for employer -sponsored defined contribution plans and associated defined benefit plans under Internal Revenue
Code Section 401(a), 401(k), 403(b), 408, and 457..
Other Financial Industry Affiiations
EAG has arrangements that are material to Its advisory business or Its clients/participants with the related entitles
shown below. These related entities may receive certain fees Chat are unrelated to EAG's fees for Its Services,
Insurance Companies
EmpowerAnnufry Insurance CompanyofAmerfca (EAIC) is an Insurance company domiciled In the State of Colorado.
EAG Is a wholly owned direct subsidiary of EAIC. EAIC, pursuant to various agreements, may provide Investment
products,recordkeeping, and other administrative services through its affiliates,
Empower Life & Annuity Insurance Company of New York (ELAINY) is an insurance company domiciled In the State
of New York. EAG Is an efflllate of ELAINY through common ownership where EAIC Is the sole owner of both EAG
and ELAINV. ELAINV, pursuantto various agreements, may provide Investment products and administrative services
through Its affiliate, Empower, to retirement plans for which EAG may also provide Its services.
Broker -Dealer
Empower Financial 6ervroes, Inc. (EFSI), en affiliate of EAG, Is, a registered limited broker -dealer and wholly owned
subsidiary of EAIC. EF51 may provide wholesaling, direct sales, enrollment and/or mmmuniwtfon services to
retirement plans and their participants for which EAG may also provide Its services. All transactions which occur as
a result of pardclpation In the Service are executed. by EFSI. EFSI may receive compensation Inthe form of 12b-1
fees or other compensation from the mutual fund companies or from the other Investments that may be available
as Investment options.
Trust Company
Empower Trust Company, LLC (ETC) is a trust company and affiliate of EAG. ETC is a wholly owned subsidiary of EAIC.
ETC is chartered under the laws of the State of Colorado. ETC 'may . provide discretionary or directed trustee and/or ..
custodial services for EAG's clients, FTC also serves as the trustee for certaln collective investmenttrusm, which may ..
be available as Investment options, and Is the custodian of all Empower premier IRA accounts.
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City Council 19 — 91 9/19/2023
I nuastment Company
Empower Funds, Inc. (EFI) Is an Investment company affiliated with EAG. It is registered under the Investment
Company Act of 1940. Empower Funds may provide Investment products to retirement plans and IRAs for which
EAG may also provide Its services. Empower Funds Is managed by Empower Capital Management, LLC as discussed
below. Shares of Empower Funds may be available for purchase by retirement plans advised by EAG or to amount
holders of the Empower Premier IRA. -
Investment Advisee -
Empower Capital Management, LLC (ECM), an affiliate of EAG, is an Investment adviser for Empower Funds and Is
registered under the Investment Advisers Act of 1940, It is a wholly owned subsidiary of EAIC. EAG provides
managed account, guidance, and advice services to participants In certain defined contribution plans. It also
provides services to account holders of the Empower Premier IRA which may have as Investment options certain
portfol Ins of Empower Funds managed by ECM.
Putnam Investment Management, LLC Is a registered Investment adviser (PIM). EAG Is under common control with
PIM and Is an affiliate of PIM: Shares of Putnam retail mutual funds may be available for purchase by retirement
plans or by the Empower Premier IRA holders. PIM serves as a sub -adviser to certain funds In the Empower Core
Strategies lineup
Irish Life Investment Managers Limited - a Dublin, Ireland based, SEC registered Investment adviser. ILIM is part of
the Great -West Lifeco, Inc. (GWL) group ofcompanies; GWL has operations In Canada, the United States, Europe,
and Asia through ownership of companies Including EAIC and PIM. EAG Is wholly owned subsidiary of EAIC EAIC is
an indirect wholly owned subsidiary of GWL which controls ILIM. ILIM manages the Index serles of Empower Funds.
Personal Capital Advisors Corporation (Personal Cafeftal), an affillate of EAG, Is wholly owned by Personal Capital
Corporation, which Is wholly owned by Empower Holdings, LLC, a wholly owned subsldlaryof EAIC. Personal Capital
Is an investment adviser registered under the Investment Advisers Act of 1940 and provides discretionary
Investment management services and financial planning services to various clients.
Branding
The affiliated companies of EAG, ECM, EFSI, EAIC, ELAINY, Empower Funds, Empower Holdings, LLC, Empower
Retirement, LLC, and ETC, operate under the multiple brands of Empower, Empower Retirement and Empower
Institutional depending upon the products, services and retirement markets involved. These brands do not
materially affect the internal structure of EAGor EAG's corporate ownership.
Conflicts of Intemst
The Investment options available In a plan are generally established by the plan sponsor/client through which our
services are delivered. Inserts cases, the plan Investment options may include, or be comprised solely of, affiliated
investment options of the Institutional client or of EAG. EAG does not receive compensation from its parent
company or any of Its affiliates as a result of these allocations. EAG has a relationship with Morningstar Investment
Management wherein Morningstar Investment Management acts as sub -adviser for the advisory services. EAG has
entered into an agreement with Morningstar I nvestment Management under which, EAG receives advisory services
fees for providing services to retirement plan clients.
EAG mitigates these confllas of Interest related to affiliated investment options by utilizing Morningstar Investment
Management as sub -adviser who remains Independent from EAG and Its related persons with respect to their
methods of analysis and mvestment strategies. Morningstar Investment Management's methodology also controls
the Investment allocations and recommendations. A clleht/account holder will pay advisory fees to EAG for MAS,
and Indirectly to ECM, If Empower Funds are Included In the retirement plan Investment options. The fees paid W
ECM for management of the Empower Funds are Included In the fund share price.
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City Council 19 — 92 9/19/2023
Conflicts relating to fund recommendations: The Services operate by recommending or allocating a user's assets to
funds available within a plan. The funds available for EAG's recommendations within a plan are generally estalell shed
by the plan sponsor/client through which the Services are delivered, rather than by EAG. In some cases, the
Investmentoptlons may Include or be comprised solely of Investmentoptlons sponsored by EAG's affiliates. mother
cases, the Investment optlons may make third party payments described below. When this occurs, LAG's affiliates
may receive additional compensation as a result of EAG's recommendations or allocations. These forms of
additional afflllate compensation are:
• Proprietary Investment funds. EAG's affiliates offer proprietary Investment funds, and EAG may
recommend or allocate your assets be our affiliates' proprietary Investment funds, Including proprietary
r mutual funds and collective Investment trusts. These proprietary Investment funds generate additional
S Investment management fees to EAG's family of companies. This Is because EAG's affiliates provide
f Investment management services to the proprietary fund for services like administering, managing, and
supervising these funds, For example, a plan particlpant using the Services will pay advisory fees to EAG
and Indirectly to ECM if Empower Funds are Included In the retirement plan Investment optlons, and EAG
recommends an allocation to a Empower Funds product. The fees paid to ECM for management of the
Empower Funds are Included in the fund share price.
• Proprietary Insurance products. EAG's parent company, LAIC, offers proprietary Insurance products for
Investment. EAG may recommend or allocate your assets to dlfferenttypes of LAIC Insurance products and
a funding agreements. The rnujorlty of LAIC Insurance products are annuity contracts that are structured
y either as a general account product or as a separate account product. If you Invest in a general account
product, which is an Insurance product backed by the general account of an insurance company, EAG's
afflllates generate revenue by retaining spread (which Is the difference between actual earnings on
contracts offered by the fnsurer), and the crediting rate declared and guaranteed by the Insurer through
the contract. EAG's affiliates may also receive different types of fee Income if you invest in the general
account or separate account products, and other thtrd-parry payments associated with Investments held
In the separate. account.
• Third Parry Payments.EAG'safffllate, may receive paymentsfrom other firms,non-propnetery investment
funds or products, or providers, such as revenue sharing payments, In connection with the investments
made pursuant to our recommendation or investment management.
ConFlices related to increased use and promotion of the Services.
a Increased advisoryfee income. EAG's representatives may recommend that you use the Services. If you
enroll In certain Services, EAG will earn additional compensation.
• Increased afflliatefee income. When you use the Services, FAG may recommend you Increase contributions
or utilize other savings or investment strategies. EAG's afflllates provide a bundle of record kee p in g, trust,
custody, brokerage, Investment, and other related services to retirement plans. If you pay for these related
- .... services through an arrangement where our affiliates charge a direct fee, EAG's affiliates may receive
additional fees for theseservlces. These additional fees resultfrom EAG's recommendations because you
may contribute, Invest, or transact in more assets with EAG's family of companies.
• Representative Compensation: EAG has authorized EFSI, an affiliate of EAG, and Its licensed agents and
registered representatives wheats Empower employees (collectively referred to as Agents) to sollcit, refer
and market EAG's services. In addition to their salary, Agents may earn bonus compensatlon based upon
engaging plan sponsors to offer EAG's services. Other Agents and EAG representatives may be Indirectly
compensated through bonus, compensation, In addition to their salary, for communication, education
and/or assisting participants to enroll In EAG's Services. Compensation pald to Agents or EAG
representatives does not Increase the fees pald by the plan, plan sponsor or participants. The incentive
compensation an EAG representative recefves depends on position type, butgenerally is calculated based
on Empower and/or LAIC profltab11Ry and the achievement of Individual performance goals that me
Include factors unrelated to an account holder's adoption of Investment products or services offered
through Empower.
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City Council 19 — 93 9/19/2023
o .Agents and. GAG representatives' Individual performance goals and their.related incentive
compensation is based on a combination of factors including the number and quality of customer
engagements during the measurement period and the amount of customer assets retained as
result of the engagements. The rate or Incentive compensation considers the total amount of
retained or accumulated assets, compared with the monthly asset goal, as determined by FAG on
a periodic basis. The asset goal Is generally set on an annual basis and may differ by product or
account type. Additional factors Include certain qualitative factors, such as leadership, teamwork,
client experience, quality and efficiency of client Interactions, and adherence to corporate policies
and regulatory standards.
- EAG's affiliates may receive payments from other firms, non-proprietary investment funds or products, or
C.-. providers, such as revenue sharing payments, In connection with the investments made pursuant to our
recommendation or investment management.
Other Business Activities
Certain senior managers and officers of FAG may also serve as executive officers of EAG's parent company, EAIC
and other affiliates of FAG.
Item 11--Code of Ethits, Participation or lntorest in Cin IIoM Tmnsaa[ions end Personal Tmdin¢
EAG's Coda of Ethics
FAG has adopted a written Code of Ethics (the Code) in compliance with Rule 204A,-1 of the Investment Advisers
Act of 1940 (Advisers Act). The Code sets forth standards of business conduct expected of advisory personnel. It
requires certain of EAG's advisory personnel to report their personal securities holdings and transactions in
accordance with the Advisers Act. EAG's advisory personnel are required to comply with the Code. A copy of the
Corte will be provided to current or prospective clienb upon request. The Code includes provisions related to:
• Fiduciary responsibility to clients;
• Compliance with federal securities laws;
• Protection and safeguarding ofconfldential Information;
• Giving and receiving gifts, gratuities, and entertainment;
• Political contributions;
• Reporting and monitoring personal Securities transactions;
• Avoiding and disclosing conflicts of Interest, and
• Reporting violations ofthe Code.
Personal Trading
The Code requires pre -clearance of certain securities transactions. Officers, managers, and certain employees of
FAG (collectively, Access Persons) may trade for their own personal accounts in securities which are recommended
m and/or purchased for EAG's advisory clients. However, because the Code would permit Access Persons to Invest
In the same securities as. clients In some circumstances, there Is a possibility that employees could benefit from
market activity by a cllent,h a seunity held by an Access Person. As a result, trading Is continually monitored In
accordance with the Code and federal securities laws. The Code Is Intended to ensure that the personal securities
transactions and the outside business activities of FAG's Access Persons do not Interfere with making, decisions In
the best Interest of advisory clients: - - -
Principal Trading
.. FAG has adopted a policy and practice not to engage In any principal transactions. FAG holds no Investments for its
own accounts which could be bought from, or sold to, an advisory client. In the event of any change In EAC's policy,
any such change must be approved by management. Any principal transactions would be permitted only after
meeting the review and approval requirements described under the anti -fraud section of the Advisers Act,
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City Council 19 -• 94 9/19/2023
Participation or late rest in Clio m Transactions _.
Aff flaw E'FSJ effects Securities Transaction forAdvisory Clients
Registered representatives of EFSI may provide wholesaling, direct sales, enrollment, and/or communication
services to retirement plans and their participants for which EAG may also provide Its services. In return, EFSI may
... recelve fees from elther the plan or the investment prodder (fund famllles): All securities transactions which occur
-' as aresult of EAG's services, as described in this Brochure, are executed by EFSI: EFSI may receive compensation In
the form of 12b-1 fees or other compensation from mutual fund companies or from the other Investments that may
be available as plan Investment options. In all instances, EAG's affllfation with these entities is disclosed. Allocations
In the Investment options are solely determined and based on Morningstar Investment Management's software
and notdetermiriations made by EAG. The compensation paid by EAC to Morningstar Investment Managementfor
Morningstar Investment Management's proprietary safiwore advise program does not vary based on the
.. allocations made or recommended by Morningstar Investment Management'. Because Morningstar Investment
Management Isunaffiliatedwith EAG and FPSI, EAG does not believe there is a conflictof Interest,
Affiliate EAlCor"INV proprietary lnustmeitts
+r Investment options Into which partidpantor accountholder assets maybe allocated, pursuantto the CA or the MA
__ .. services may be through a fixed and variable deferred annuity issued by EAIC or ELAINY. Because Morningstar
Investment Management is unaffiliated with EAG, EAIC, EIAINY andtheiraffliates, EAG does not believe there Is a
conflict of Interest. However, In all Instances, EAG's afRllation with EAIC and/or EAIC's affiliates, as applicable, will
be. disclosed,
Item 12- Brukorase Practices
Brokerage Selection; Bast Execution
- For retirement plans, the plan sponsor or Its agent selects the broker -dealer used by the retirement plan and
... determines the reasonableness of the compensation. EAG does not select or recommend broker -dealers for stock
transactions or self -directed brokerage accounts and does not determine the reasonableness of broker -dealer's
compensatioia. Transactions recommended by Morningstar Investment Managementfc r the Service are processed
by EAG's affiliated recordkeepeq Empower, and generally executed through EFSI.
Soft Dollar Practices
As a matter of polity, EAG does not itillre research or other products or,oIces from third parties in connection
with client securltrm transactions on a soft -dollar commission basis.
Directed Brokerage
The plan sponsor may elect in offer brokerage services to participants in the retirement plan. EAG does not
participate in such decisions and does not provide recommended portfolios or investment recommendations on
assets held Ina brokerage account under the retirement plan -
Trade Aggregation • 1 - - - -
EAG does not bunch orders or engage in block trades to execute equity orders for clients. Client accounts are
generally held in trust per regulatory requirements. Further, rnost trades aremutual funds where trade aggregation
does provide anyadditional cifedttienefIts. - -
Itom13-Review, of Accounts
At least annually, EAG personnel review the methodologies used by Morningstar Investment Management to powar
-- the OIG, OA, and MA services to enmure that they are consistent with Investment advisory best practices, currant
- technology, applicable law, and the terms of the agreement between EAG and Morningstar Investment
Management,
Neither EAG nor Morningstar Investment Management review the personal financial Information of participant: as
- provided by the participants or the Plan Sponsor and do not assume responsibility for any Incomplete or erroneous
17
City Council _____ 19 — 95 9/19/2023
information.Such Information, which Includes date of birth, salary, gender and/or state of. residence, most be
reviewed periodically by the participant and/or the Plan Sponsor who In turn are responsible for notifying EAG of
any changes,errors, or omissions to such Information.
EAG conducts the following review of its clients'accounts: _.
Online Investment Guldence EAGdoes not conduct any review or other oversight for participants enrolled InthIsservice.
OnlineAdvice
EAG does not conduct review of Its participant's accounts In respect to Investment oversight, monitoring, or
rebalancing. Participants receive from EAG's Investment recommendations based on the Investment options
provided in their specific retirement plan. It Is the responsibility of CA clients to review and update their accounts
to adjust for changes in the investments they own and todetermine whether the recommendations ere suitable
for their particular investment needs. OA clients should also review and update their amounts if significant
changes occur inthoir personal circumstances.
Managed Account Service
Under the MA service, participant assets in the investment options are monitored, rebalanced, and reallocated on
a periodic basis by EAG, based on Morningstar Investment Managements software program. On art annual basis,
based on the individual's-birth date, those enrolled in the MA service will receive an Annual Kit containing an
account update and forecast statement. Morningstar Investment Management updates the capital market
assumptions underlying their methodology used to construct the asset classes, at least annually, then makes
changes to the portfolio allocations,,as necessary. The portfolios are also monitored on a regular basis on current
portfolio allocations and adjustments are made as necessary.
Reporting to Clients
Participants enrolled In the MA service receive a MA Welcome Kit shortly after enrollment and an account update
at least annually. Participants enrolled In OA can review their accounts and generate their own reports starry time.
Individuals are encouraged to update significant changes to their personal information via the appropriate toll -free
customer service number. In addition, all Individuals receiving Services are provided quarterly account statements
generated by the plan's recordkeeper.
Item 14— Client Referrals and Other Compensation
EAG has authorized EFSI, an affiliate of EAG, and Its licensed agents and registered representatives who are Empower
employees (collectively referred to as Agents) to solicit, refer and market EAG's services. EAG does not pay any
compensation directly to EFSI or its Agents for the solicitation activities performed by EFSI and Its Agents. The Agents
receive compensation. in the form of a salary and a. variable bonus paid by Empower. No commissfons are paid to
Agents for the Services by EAG or EFSI.,
Agents may earn bonus compensation based upon engaging plan sponsors to offer EAG's services: Other Agents and
EAG representatives may be Indirectly compersated throughbonuscompensation, In addition to their salary, for
communication, education and/or assisting participants to enroll In EAC's Services. The Incentive compensation an
EAG representative receives depends on position type, but generally is calculated based on Empower Retirement
and/or EAIC profitability and the achievement of Individual performance goals that may Include factors unrelated to
an account holder's adoption of Investment products or services offered through Empower Retirement.
Agents and EAG representatives individual performance goals and their related incentive compensation is based
on a combination of factors including the number and quality of customer engagements during the measurement
period and the amount of customer assets retained as result of the engagements. The rate of incentive
compensation considers the total amount of retained or accumulated assets, comparedwith the monthly asset
goal, as determined by EAG on a periodic basis. The asset goal is generally set on an annual basis and may differ by
product or account type. Additional factors may include certain qualitative factors, such as leadership, teamwork,
Sg
City Council 19 — 96 9/19/2023
client experience, quality and efficiency of client Interactions, and adherence to corporate policies and regulatory
standards. Compensation paid to Agents or EAG representatives does not increase the fees paid by the plan, plan
sponsor or Members.
Item IS— Cust Custody
EAG does not maintain actual custody of Its clients' cash, bank accounts, or securities. Pursuant to Rule 206(4)-2 of
the Advisers Act as amended, EAG Is deemed to have constructive custody with respect to certain client funds and
securities. This Is because an affiliated party is the custodian and directed or discretionary trustee of certain
retirement plan accounts. In addition to annual audits, these accounts, are subject to surprise custody verifications
by an Independent public accountant each year, as required by Rule 206(4)-2, If applicable, EAG's clients receive
periodic account statements (at least quarterly) from their custodian and should carefully review these statements.
Certain clients.may have assets held by unaffiliated custodians. _
Item 16— Investment Discretion
EAG provides discretionary investment management services for those plan participants who enroll and participate
In the MA service; EAG does not offer or engage in discretionary investment services for either OIG or CIA,
The MA service is a professional, Flexible asset management program that utilizes data from the methodologies and
proprietary software program developed and employed by its IFE, Morningstar Investment Management. To
provide the MA service to plan participants, EAG retains discretionary authority over the allocation of available
Investment options without requiring prior approval of each transaction. All ongoing investment transfers and
Investment direction changes are implemented for plan participants enrolled in the Managed Account service.
Item 17— Voting Client Securities
EAG does not assume the responsibility to provide assistance or vote proxies or other issuer communications
regard Ing your Account, or to exercise voting or other decision -making authority regarding proxies or other Issuer
communications. Correspondence regarding the matters described in this section will be handled in connection
with the Plan's policies and service provider arrangements.
EAG, as a registered investment adviser', and as a matter of practice, does not accept authority to vote client
securities in connection with any of the services described in this Brochure. Correspondence regarding the matters
described in this section will be handled in connection with the Plan's policies and service provider arrangements.
Item 18
Financial Information
As previously discussed, under certain circumstances EAG has discretionary authority over certain client funds and
securities. Accordingly, EAG is required to disclose information about its financial condition that is reasonably likely to impair its ability to meet contractual commitments to its clients. EAG has no financial commitment that impairs
its ability to meet contractual commitments to its clients, nor has EAG been the subject of a bankruptcy proceeding.
Further, EAG does not require or. solicit prepayment of fees in excess of $1,200 per client more than six months in
.advance. _
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City Council 19 — 97 9/19/2023
Exhibit 5
City of Santa Ana - Insurance Requirements
Empower shall procure and maintain for the duration of the contract insurance against claims for injuries to
persons or damages to property which may arise from or in connection with the performance of the work
hereunder and the results of that work by the Empower, his agents, representatives, employees or
subcontractors.
MINIMUM SCOPE AND LIMIT OF INSURANCE
Coverage shall be at least as broad as:
1. Commercial General Liability (CGL): Insurance Services Office (ISO) Form CG 00 01 covering
CGL on an "occurrence" basis, including products and completed operations, property damage,
bodily injury and personal & advertising injury with limits no less than
$1,000,000 per occurrence. If a general aggregate limit applies, either the general aggregate limit
shall apply separately to this project/location (ISO CG 25 03 or 25 04) or the general aggregate
limit shall be twice the required occurrence limit.
Automobile Liability: ISO Form Number CA 00 01 covering any auto (Code 1), or if Contractor
has no owned autos, hired, (Code 8) and non -owned autos (Code 9), with limit no less than
$1,000,000 per accident for bodily injury and property damage.
3. Workers' Compensation insurance as required by the State of California, with Statutory Limits,
and Employers' Liability Insurance with a limit of no less than $1,000,000 per accident for bodily
injury or disease and disease policy limit.
4. Professional Liability, with limits no less than $1,000,000 per occurrence or claim, and
$2,000,000 policy aggregate.
If the Empower maintains broader coverage and/or higher limits than the minimums shown above, the City
requires and shall be entitled to the broader coverage and/orthe higher limits maintained by Empower. Any
available insurance proceeds in excess of the specified minimum limits of insurance and coverage shall be
available to the City.
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City Council 19 — 98 9/19/2023
Other Insurance Provisions
The insurance policies are to contain, or be endorsed to contain, the following provisions:
Additional Insured Status
The City, its officers, officials, employees, and volunteers are to be covered as additional insureds on the
CGL policy with respect to liability from the work or operations performed by Empower including materials,
parts, or equipment furnished in connection with such work or operations. General liability coverage can be
provided in the form of an endorsement to Empower's insurance.
Primary Coverage
For any CGL claims related to this contract, Empower's insurance coverage shall be primary coverage as
respects the City, its officers, officials, employees, and volunteers. Any insurance or self-insurance
maintained by the City, its officers, officials, employees, or volunteers shall be excess of Empower's
insurance and shall not contribute with it.
Notice of Cancellation
Upon written request, Empower will offer proof of insurance renewal or extension within 30 days following
the expiration date of any of the policies required. Such certificate(s) shall suffice as evidence that required
insurance is maintained.
Waiver of Subrogation
Empower hereby grants to City a waiver of any right to subrogation which any insurer of Empower may
acquire against the City by virtue of the payment of any loss under such insurance. Empower agrees to
obtain any endorsement that may be necessary to affect this waiver of subrogation, but this provision
applies regardless of whether or not the City has received a waiver of subrogation endorsement from the
Insurer.
Self -insured Retentions
Self -insured retentions must be declared to the City. The City may require the Consultant to provide proof
of ability to pay losses and related investigations, claim administration, and defense expenses within the
retention. The policy language shall provide, or be endorsed to provide, that the self -insured retention may
be satisfied by either the named insured or City.
Acceptability of Insurers
Insurance is to be placed with insurers authorized to conduct business in the state with a current
A.M. Best's rating of no less than A:VII, unless otherwise acceptable to the City.
m
City Council 19 — 99 9/19/2023
Claims Made Policies
If any of the required policies provide coverage on a claims -made basis:
The Retroactive Date must be shown and must be before the date of the contract or the beginning of
contract work.
2. Insurance must be maintained and evidence of insurance must be provided for at least three (3) years
after completion of the contract of work.
3. If coverage is canceled or non -renewed, and not replaced with another claims -made policy form with
a Retroactive Date prior to the contract effective date, Empower must purchase "extended reporting"
coverage for a minimum of three (3) years after completion of contract work.
Verification of Coverage
Empower shall furnish the City with original Certificates of Insurance including all required amendatory
endorsements (or copies of the applicable policy language effecting coverage required by this clause) to
City before work begins. However, failure to obtain the required documents prior to the work beginning shall
not waive Empower's obligation to provide them.
Subcontractors
If any subcontractors are engaged by Consultant specifically for the provision of services to the Entity,
subcontractors' Insurance coverages may or may not comply with the Entity's minimum insurance
requirements. Consultant agrees that it retains responsibility for performance of all services herein,
including components performed by subcontractors.
Special Risks or Circumstances
City reserves the right to modify these requirements, including limits, based on the nature of the risk, prior
experience, Insurer, coverage, or other special circumstances. However, If City requires new limits or
coverage that exceed Empower's current limits or coverage then City will be responsible forthese additional
premium costs.
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City Council 19 — 100 9/19/2023
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