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HomeMy WebLinkAboutContracts & Agreements_5-2015_CCv0001.pdf Page 1 of 8 Nationwide Investment Advisors,LLC ProAccount- Plan Sponsor Agreement Plan: The City of Redlands 457 Plan Sponsor: The City of Redlands The foregoing Plan currently utilizes services and products offered by Nationwide Retirement Solutions, Inc. ("NRS") and its affiliated companies (the"Nationwide Retirement Program"). On behalf of the Plan, the Plan Sponsor desires to appoint Nationwide Investment Advisors, LLC ("NIA"), an Ohio limited liability company, registered as an investment adviser with the Securities and Exchange Commission under the Investment Adviser's Act of 1940("Advisers Act") and an affiliate of NRS, as an authorized provider of investment advisory services to participants in the Plan ("Plan Participants") who desire professional guidance in managing their self-directed accounts within the Plan ("Accounts"). NIA's ProAccount program(the"Advice Program") offers individualized investment advice using an investment process developed and maintained by an independent financial expert("IFE") selected and retained by NIA. WHEREAS, on behalf of the Plan, the Plan Sponsor hereby approves NIA as an authorized provider of investment advisory services through the Advice Program to those Plan Participants who choose to have their Accounts managed by NIA (collectively, the"Plan's Account"); WHEREAS, the Plan Sponsor hereby authorizes each such Plan Participant's self-direction of their own Account, subject to guidelines imposed by the Plan, and authorizes each Plan Participant to enter into an investment advisory agreement directly with NIA for the management of their account; WHEREAS, the Plan Sponsor acknowledges that such advisory services are permitted under the documents establishing the Plan ("Plan Documents") and that the investments and investment strategies proposed by NIA through the Advice Program are consistent with the Investment Policy of the Plan; and WHEREAS, Plan Sponsor acknowledges that NIA and NRS are affiliates and that NRS will provide to NIA certain administrative services in support of the Advice Program; NOW,THEREFORE, in consideration of the foregoing and the promises, covenants and mutual agreements set forth herein,the adequacy of which is hereby mutually acknowledged,NIA and the Plan Sponsor, each intending to be legally bound,hereby do agree as follows: I. APPOINTMENT OF INVESTMENT ADVISOR The Plan Sponsor hereby appoints NIA to exercise discretionary authority to allocate and reallocate Plan Participant Accounts in the manner described in Section II below and NTA hereby accepts this appointment, subject to the terms and conditions of this Agreement. NIA's authority under this Agreement will remain in effect until changed or terminated pursuant to the termination provisions described in this Agreement. NRS Plan Sponsor Lx Agreement NRM-7482AO.2-10/11 Page 2 of 8 H. ADVICE PROGRAM DESCRIPTION The Advice Program is a discretionary managed account service offered by NIA for retirement plan participants who desire professional guidance in managing their self-directed retirement pian account. The Advice Program offers individualized investment advice using an investment process developed and maintained by an IFE. Under the Advice Program,the IFE develops and maintains managed account portfolios ("Portfolios")based on all eligible investment options available under the Plan's menu of investments ("Advice Program Investments"). In addition, the Plan may offer investment options other than Advice Program Investments, including, but not limited to, individual stocks, employer stock, guaranteed certificate funds, and collective investment funds (collectively, "Non-Advice Program Investments"), which will not be considered by the IFE in the development of Portfolios. In order for Plan Accounts to be eligible for management under the Advice Program, they must be invested in mutual funds or variable insurance sub-accounts at the time the Plan Participant enrolls in the Advice Program. Plan Sponsor hereby acknowledges that any employer-directed assets, restricted assets (including assets invested in the Nationwide Fixed Contract), or assets held in self-directed brokerage accounts are not eligible for the Advice Program and will remain invested in their current manner until further action is taken by the Plan Participant or the Plan. The IFE is not a party to this Agreement, and there is no contractual relationship between the Plan and the IFE. All fees and expenses charged by the IFE for its services will be paid by NIA. The advice provided to Plan Participants under the Advice Program is limited to the independent advice provided based on the Portfolios created by the IFE, which NTA cannot modify. By signing this Agreement, you agree that NIA has discretion to terminate its relationship with the IFE at any time, without notice to you, and engage the services of a suitable replacement. By allowing the Advice Program to be offered to the Plan, you are naming NIA as an authorized provider of investment advisory services to those Plan Participants who choose to have their accounts managed by NIA. III. OBLIGATIONS AND REPRESENTATIONS OF THE PLAN SPONSOR The Plan Sponsor agrees to notify NTA of any change to the Plan Documents that affects NIA's rights or duties to the Plan or Plan Participants, and acknowledges that such change will bind NIA, as the case may be, only when NIA agrees to it in writing. Plan Sponsor hereby approves all forms that NIA has developed for use by Plan Participants with respect to the solicitation and enrollment of such participants into the Advice Program. The Plan Sponsor represents that (1)NIA's investment advisory services are permitted under the Plan Documents; (2) the Plan Sponsor has the authority to enter into this Agreement on behalf of the Plan; and(3) the Plan is operated, and NIA's appointment is, in compliance with all applicable federal and state laws, rules and regulations. NRS Plan Sponsor Lx Agreement NRM-7482A0.2-10/11 Page 3 of 8 IV. OBLIGATIONS AND REPRESENTATIONS OF NIA NIA agrees that in performing any of its duties and obligations hereunder, NIA will act in conformity with all terms and provisions of the agreements entered into between NIA and the Plan Participants and any instructions given pursuant thereto or otherwise, and will conform to and comply with the requirements of the Advisers Act and all other applicable federal and state laws,rules and regulations, as each may be amended from time to time. NIA represents that it is registered as an investment adviser under the Advisers Act or under applicable state law in each state in which it is providing investment advisory services or is otherwise required to be registered and/or notice filed, and each of its representatives are properly registered, licensed and/or qualified to act as such under all applicable federal and state securities statutes and regulations. NIA does not have any duty,responsibility or liability for Plan assets that are not part of the Plan's Account that NIA manages through the Advice Program. NIA will not be providing investment advice regarding, or have fiduciary responsibility for, the selection and monitoring of investment options available in the Plan. NIA shall have no obligation or authority to take any action or render any advice with respect to the voting of proxies solicited by or with respect to issuers of securities held in the Advice Program. V. ADVICE PROGRAM FEES In consideration of services rendered to Plan Participants, the Plan Sponsor hereby approves, subject to specific approval by each Plan Participant electing to have their Accounts managed by NIA, a participant level Advice Progam fee("Advice Program Fee") as outlined in the following schedule: Account Balance Annual Program Fee The first$99,999.99 1.00% The next$150,000 0.90% The next$150,000 0.75% The next$100,000 0.60% Assets of$500,000 and above 0.50% NRS Plan Sponsor Lx Agreement NRM-7982A0 2-16/11 Page 4 of 8 The Advice Program Fee is separate from the fees and expenses charged by investment options offered through the Plan and in addition to any trustee, custodial, asset, service, administrative or transactional fees that the Plan Participants or the Plan may incur through the Nationwide Retirement Program. The Advice Program Fee shall be calculated daily based on the Participant's daily balance and the calculated Advice Program Fee withdrawn quarterly in accordance with each Plan Participant's investment advisory agreement with NIA. The Plan Sponsor hereby consents to the withdrawal of the Advice Program Fee from the applicable Plan Participant Accounts and agrees that it will use its best efforts to facilitate payment of such Advice Program Fee. If this Agreement ends before the end of the applicable calendar quarter, then a pro-rata share of the Advice Program Fee will be withdrawn from the Plan's Account. To the extent permitted by applicable law or regulation, affiliates of NIA may receive payments from, or in connection with, investment options selected by the IFE which are included in the Portfolios. In addition, the IFE may select certain investment options for which NIA or an investment advisory affiliate acts as investment adviser. The IFE's fees for services provided under the Advice Program are not related to the investment options the IFE selects for the Portfolios or otherwise influenced by the payments NIA or its affiliates may receive from such investment options. Certain Advice Program Investments may charge a redemption fee or impose a trade restriction on certain transactions. Redemption fees vary in amount and application from investment option to investment option. It is possible that transactions initiated by NIA under the Advice Program may result in the imposition of redemption fees or trade restrictions on one or more investment options held in Plan Participant Accounts. Any redemption fees will be deducted from the Plan Participant's Advice Program Account balance. For further information on redemption fees or trade restrictions, including whether they will be applicable to any of the investment options within your Plan, please consult the individual fund prospectus or other investment option disclosure material. VI. INDEMNIFICATION,LIMITATION OF LIABILITY,AND RISK ACKNOWLEDGMENT Each party agrees to hold harmless, defend and indemnify the other party (including its directors, officers, employees, affiliates and agents) from and against any and all claims, liabilities, losses, costs, damages or expenses (including, without limitation, cost of litigation and reasonable attorneys' fees) (collectively, "Losses") arising out of or attributable to the indemnifying party's (i)willful misconduct,bad faith, criminal activity, or gross negligence, (ii)material breach of this Agreement or the material inaccuracy of any representation or warranty provided hereunder, or(iii) violation of any law to which such party is subject. Plan Sponsor, on behalf of the Plan, agrees to hold hanmless, defend and indemnify NIA (including its directors, officers, employees, affiliates and agents) from and against any and all Losses arising out of or attributable to NIA's following directions or carrying out instructions, or using obsolete, inaccurate or incomplete information, given or furnished by the Plan or its agents. NRS Plan Sponsor Lx Agreement NRM-7982Ao.2-10/I I Page 5 of 8 A party that seeks indemnification under this Section VI must promptly give the indemnifying party written notice of any legal action. But a delay in notice does not relieve an indemnifying party of any liability to an indemnified party, except to the extent the indemnifying party shows that the delay prejudiced the defense of the action. The indemnifying party may participate in the defense at any time or it may assume the defense by giving notice to the other party. After assuming the defense,the indemnifying party: must select an attorney that is satisfactory to the other party; is not liable to the other party for any later attorney's fees or for any other later expenses that the other party incurs, except for reasonable investigation costs; must not compromise or settle the action without the other party's consent (but the other party must not unreasonably withhold its consent); and is not liable for any compromise or settlement made without its consent. If the indemnifying party fails to participate in or assume the defense within 15 days after receiving notice of the action, the indemnifying party is bound by any determination made in the action or by any compromise or settlement made by the other party Federal and state securities laws impose liabilities in certain circumstances on persons who act in good faith, and nothing in this Agreement waives or limits any rights either party has under those laws. Risk Acknowledgment NIA uses reasonable care, consistent with industry practice, in providing advisory services through the Advice Program. Investments within the Plan, as all investments in securities, involve risk and will not always be profitable. Investment return and principal will fluctuate with market conditions, and Plan Participant Accounts may lose money. Past performance of investments is no guarantee of future results. The analysis and advice provided by the IFE and delivered by NIA depends upon a number of factors, including the information you or the Plan Participants may provide, various assumptions and estimates, and other considerations. As a result,the advice developed and the recommendations provided are not guarantees that Plan Participants will achieve their retirement goals or anticipated performance. The investment advice provided under this Agreement relates only to the Plan Participant Accounts and will not apply to any other assets a Plan Participant may own. VII. CONFIDENTIALITY Each party agrees that it will not, without the prior written consent of the other party, at any time during the term of this Agreement or any time thereafter, except as may be required by competent legal authority or as necessary to facilitate the implementation of services hereunder, use or disclose to any person, firm or other legal entity,including any affiliate or other representative of the party, any confidential records, secrets or information related to the other party(collectively, "Confidential Information"). Confidential Infonnation shall include, without limitation, information about the other party's products and services, customer lists, customer or client information, Plan and Plan Participant information, and all other proprietary information used by the party in its business. The parties acknowledge and agree that all Confidential Information that it has acquired, or may acquire, was received, or will be received in confidence. Each party will exercise utmost diligence to protect and guard such Confidential Information. NRS Plan Sponsor Lx Agreement NRM-7982AO.2-10/11 Page 6 of 8 The Plan Sponsor (1) acknowledges that it is authorized to provide Confidential Information, including but not limited to Plan Participant information, to NTA for the operation of the Advice Program, and the provision of such information does not violate any Plan or company provisions or policies; and(2) authorizes the sharing of Plan Participant information among NIA and its affiliates as necessary for the operation of the Advice Program. VIII. TERM OF AGREEMENT This Agreement shall become effective upon acceptance by NTA, or its designated agent, upon review and receipt in its principal place of business, and such acceptance may be evidenced by internal records maintained by NIA or its designated agent. This Agreement shall continue until tenninated by either party upon at least 30 days' advance written notice to the other. This Agreement will terminate immediately if the Plan terminates its participation in the Nationwide Retirement Program. In the event NIA terminates its relationship with the current IFE and has not designated a successor IFE,this Agreement shall automatically terminate upon written notice from NIA. The Plan Sponsor understands that upon termination of this Agreement, the Plan's Account will remain invested in the Advice Program Investments last allocated by NIA until such time as Plan Participants make changes to their individual Accounts. IX. MISCELLANEOUS Notices All notices required to be delivered under this Agreement will be delivered in person or by U.S. first class mail,overnight courier, or facsimile (with a paper copy provided via the U.S.mail), in each case prepaid,to NIA at the address provided below and to the Plan Sponsor at the address provided on the signature page of this Agreement(or to such other addresses as the parties may specify to one another in writing): Nationwide Investment Advisors, LLC 5100 Rings Road, Mail Stop RR1-06-05 Columbus, Ohio 43017-1522 Attention: ProAccount Phone: 888/540-2896 Fax: 614/435-5419 Notices will be deemed given upon dispatch. Form ADV The Plan Sponsor acknowledges having received and read NIA's Form ADV,Part 2 ("Fonn ADV") and Privacy Policy upon entering into this Agreement. The Foran ADV is a disclosure document that summarizes the investment advisory services provided by an investment adviser registered with the SEC and/or the states. The Form ADV contains additional information about the Advice Program. Entire Agreement; Amendment This Agreement constitutes the entire agreement between the parties hereto with respect to the obligations arising hereunder and supersedes and cancels any prior agreements, representations, warranties or communications, whether oral or written, among the parties hereto relating to the NRS Plan Sponsor Lx Agreement NRM-7982AO.2-10/1 I Page 7 of 8 subject matter hereof This Agreement maybe amended by NIA upon 30 days' prior written notice to the Plan Sponsor and may be amended immediately upon notice to the extent required to satisfy federal or state regulatory requirements. Headings All Section headings in this Agreement are for convenience of reference only and do not form part of this Agreement. Section headings will not, in any way, affect the meaning or interpretation of this Agreement. Waiver No delay by either party in requiring performance by the other shall affect the right of such party to require performance; no waiver by either party of any breach shall be construed as a waiver of any subsequent breach or as a waiver of the provision itself or any other provision. Survival All terms and provisions of this Agreement, including without limitation: "Indemnification, Limitation of Liability, and Risk AcknowIedgment,""Confidentiality,"and Miscellaneous" which should by their nature survive the termination of this Agreement, shall so survive the termination of this Agreement. Assignment Neither party may assign this Agreement (within the meaning of the Advisers Act) or assign any of the rights or delegate any of the duties or obligations of this Agreement without the other party's prior consent. Any assignment in violation of this provision shall be void and of no force or effect. Force Majeure Neither party shall be liable for failure to perform if the failure results from a cause beyond its control, including,without limitation, fire, electrical,mechanical, or equipment breakdowns, delays by third party providers and/or communications carriers, civil disturbances or disorders, terrorist acts, strikes, acts of government authority or new governmental restrictions, or acts of God. Severability Should any provision of this Agreement be held invalid or unenforceable by any court, arbitrator, statute, rule or otherwise, the remaining provisions of this Agreement will not be affected thereby and will continue in full force and effect to the fullest extent practicable. Governing Law This Agreement and its enforcement will be governed by and construed in accordance with the laws of the State of Ohio, without regard to the conflicts of law provisions or principles. Nothing herein will be construed in any manner inconsistent with the Advisers Act or any rule or order of the Securities and Exchange Commission, as applicable. NRS Plan Sponsor Lx Agreement NRM-7982AO.2-19/11 Page 8 of 8 IN WITNESS WHEREOF, the Plan Sponsor, on behalf of the Plan, has executed this Agreement as of the date set forth below. Plan: The City of Redlands 457 By: (signature) (�n Title: Aye Print Name: Paul W. Foster, Mayor Plan Address: 35 Cajon Street, Redlands, CA 92373 Plan Contact/Telephone: 909.798.7514 Date: January 20, 2015 ATTEST: Sam Irwi , C4 Clerk ACCEPTED BY NIA: Nationwide Investment Advisors, LLC By: Title: Print Name: Date: NRS Plan Sponsor Lx Agreement NRM-7982AO.2-10/11