Updates on your Vanguard 403(b) account transition

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1 September 2017 P.O. Box 2600 Valley Forge, PA [Name] [Company] [Address 1] [Address 2] [Address 3] [City, State Zip] vanguard.com Updates on your Vanguard 403(b) account transition Dear [Participant Name], Recently we shared our plans to partner with Newport Group, one of the country s leading retirement plan service providers, to bring you a more comprehensive retirement program. We re pleased to report that progress toward completing this program Vanguard 403(b) Services is on schedule, and we expect everything to be up and running by November 13, First, some great news about your investment choices You ll have the opportunity to invest in our lower-cost Admiral share class of mutual funds. What are Admiral Shares? They re a separate share class of our mutual funds with expense ratios that are, on average, 41% lower than our standard Investor share class and 83% lower than the industry average.* Over time, the cost savings from Admiral Shares can really add up: The more you save in costs, the more money you can keep in your account, and the more the power of compounding can work for you. Admiral Shares are offered by many of the funds included in the Vanguard 403(b) Services investment lineup. Want more good news? The minimum amount normally required to invest in Admiral Shares ($10,000, $50,000, or $100,000, depending on the fund selected) is waived for Vanguard 403(b) Services participants. And there s no minimum balance requirement for you either. Please note: If your account already holds Vanguard Investor Shares of a fund that offers Admiral Shares, we ll automatically convert your Investor Shares to Admiral Shares for you starting on October 4, 2017, and continuing through the month. You ll receive a confirmation after the conversion is complete. (over) * Average expense ratios: Vanguard Admiral Shares: 0.12%; Vanguard Investor Shares: 0.20%; mutual fund-only industry average: 0.69%. All averages are asset-weighted. Industry averages exclude Vanguard. Sources: Vanguard and Morningstar, Inc., as of December 31, The Vanguard Group, Inc. All rights reserved. Vanguard Marketing Corporation, Distributor of the Vanguard Funds. P403BLTR

2 Next, some additional explanation about fees Vanguard has adjusted the plan pricing. We ve changed our pricing to more accurately reflect the additional plan services and capabilities we re offering in the enhanced program. Starting in 2018, each participant will pay a flat $5 monthly recordkeeping fee ($60 annually). The $5 fee replaces the $15 annual fee for each mutual fund held in an account. This means you can hold multiple funds, including lower-cost Admiral Shares, without incurring multiple fees. Previously, you d pay $60 to hold 4 funds; now you can hold any number of funds and won t pay more than $60. And there are no charges to buy or sell funds (front- or back-end loads), and no commissions, withdrawal fees, or other investment-related fees commonly collected by other companies.** Other news we want you to know about You ll experience a blackout period during the transition to the enhanced program. What is a blackout period? It s a time frame during which you won t be able to access or transact on your account, or take distributions (including onetime distributions, installment distributions, and automatic exchanges). In addition, no contributions will be made to your account during this time. When is the blackout period? It starts at close of business on November 3, 2017, and extends through the week of November 6, We ve provided a required notice on the next page that describes your rights during the blackout period. Newport Trust Company will serve as custodian but Vanguard will continue as your investment provider. Once the program launches in the fall, Vanguard will remain as your investment provider, but Vanguard Fiduciary Trust Company will resign as custodian of 403(b) custodial accounts. Effective November 4, 2017, Newport Trust Company will become successor custodian, assuming the custodial duties described in the updated 403(b) custodial account agreement. Visit vanguard.com/caa to review the agreement, including a change to voting rights. Key 403(b) 2017 dates October 4 through the end of the month. Eligible funds are converted to Admiral Shares. November 3 (at close of business) through the week of November 6. Blackout period. 403(b) accounts are inaccessible. November 13 Transition to Vanguard 403(b) Services is complete. What do you need to do? Nothing at all. We simply wanted to let you know that the transition plans are moving along as expected and to keep you up to date on the program s progress. If you re actively participating in an employer-sponsored plan, we ll automatically transition your account for you in November. (continued on the next page) ** The flat fee covers the costs of recordkeeping, custodial, administrative, and account services provided in the Vanguard 403(b) Services program. Unlike an asset-based fee, a flat fee will not increase as your account assets grow. There is a charge for loans, if your plan offers them, and there may be a charge for certain optional hardship and domestic relations order services, if elected.

3 You may be eligible for other options: You could be eligible to move your account to another approved vendor if it s permitted under the terms of your employer s plan. Check with your plan administrator to determine your eligibility. Or if you re no longer working for the employer who sponsors your plan, you may be able to roll over your plan assets to an IRA. Go to vanguard.com/ira_rollover to find out more about rolling over to a Vanguard IRA. Have questions? Visit vanguard.com/transition to find frequently asked questions about the transition. Or call us at Monday through Friday from 8 a.m. to 8 p.m., Eastern time. That s about it for now. We re excited about what s happening with our 403(b) program. And come November, we think you will be too. Thank you for belonging to the Vanguard community of investors. Sincerely, Alba E. Martinez Principal Retail Investor Group All investing is subject to risk, including the possible loss of the money you invest. There are important factors to consider when rolling over assets to an IRA. These factors include, but aren t limited to, investment options in each type of account, fees and expenses, available services, potential withdrawal penalties, protection from creditors and legal judgments, required minimum distributions, and tax consequences of rolling over employer stock to an IRA.

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5 Notice Concerning Your Rights Under the Vanguard 403(b) Custodial Account September 2017 Federal law generally requires that you receive notice if your rights to direct or diversify the assets in your account, or to receive distributions, will be suspended or limited. This is to give you the time you need to consider the effect such a blackout period could have on your retirement and financial plans. 1. This notice is to inform you that your Vanguard 403(b) Custodial Account will be undergoing some changes to account services, including a change to an enhanced recordkeeping platform. As a result of this change, you ll be temporarily unable to direct or diversify any of the investments in your individual accounts or obtain a distribution from those accounts (including onetime distributions, installment distributions, and automatic exchanges). This period, during which you ll be unable to exercise these rights otherwise available under the plan, is called a blackout period. Whether or not you re planning retirement in the near future, we encourage you to consider carefully how this blackout period may affect your retirement planning, as well as your overall financial plan. 2. The blackout period for the plan will start at close of business on November 3, 2017, and extend through the week of November 6, During the blackout period, you ll be unable to direct or diversify the assets held in your plan account, so it s very important that you review and consider the appropriateness of your current investments. For your long-term retirement security, you should give careful consideration to the importance of a well-balanced and diversified investment portfolio, taking into account all your assets, income, and investments. 4. If you have any questions concerning this notice, call Vanguard at or write to us at P.O. Box 2600, Valley Forge, PA Connect with Vanguard > vanguard.com