GREAT NEWHOME FOR YOUR RETIREMENT MONEY. Hexagon Employee Retirement Savings Plan

Transcription

1 AAGREAT GREAT NEW NEWHOME HOME FOR YOUR RETIREMENT MONEY Hexagon Employee Retirement Savings Plan

2 Your retirement plan is moving to a great new home At Hexagon, helping you achieve a comfortable retirement is one of our important priorities. Because we aim to make our retirement plan the best place for you to save for your future, we re making some key changes. In January 2017, your EcoSys Management, LLC 401(k) Profit Sharing Plan and Trust will move to Vanguard and merge with the Hexagon Employee Retirement Savings Plan (Plan). Please review this newsletter for detailed information on the changes and how they will affect you. You can also visit vanguard.com/hexagonecosys for more information including key dates involved with the transition. 2

3 An important source of retirement income Whether you picture your retirement as quiet and simple or filled with travel and hobbies, chances are it won t come cheap. It s realistic to plan for a retirement lasting 30 years or more. And while Social Security may supplement your retirement income, your savings including those in your new Hexagon Employee Retirement Savings Plan account will most likely be your primary income source. When your account moves to Vanguard, you ll enjoy: Investment flexibility. You ll have access to an array of investments to meet your needs. Convenient account access. You can check your balance, make transactions, and use financial planning tools at vanguard.com/retirementplans. You can also go to vanguard.com/bemobile to download the Vanguard app so you can access your account on the go. Enhanced education and planning. You ll get a wealth of information from Vanguard about your Plan and how to invest for retirement. To get started, go to vanguard.com/education. 3

4 FEATURES OF THE HEXAGON EMPLOYEE RETIREMENT SAVINGS PLAN Employee contributions. You will be able to contribute 1% to 100% of your base salary, bonuses, and commissions to the Plan on a pre-tax or Roth 401(k) after-tax basis (or a combination of the two). Company match. When you contribute to the Plan, Hexagon will make matching contributions to help you save even more. For every $1 you contribute to the Plan up to 6% of your pay, Hexagon will contribute an additional $1. If you don t save at least 6% of your pay in the Plan, you aren t receiving the full match. Vesting. Vesting refers to your right to the ownership of the money in your account. You are immediately vested in all contributions, including company matching contributions, and earnings in your account. In other words, if you leave Hexagon in the future, you will not forfeit any of the money in your account. Automatic contribution increases. To help you save more, you can have your contribution rate automatically increased for you each year. Simply decide how much more you d like to save annually from one to three percentage points. You can set up automatic increases anytime. These annual increases can continue until your contributions reach the plan or the annual IRS limit, whichever is less. Plan administration fee. At Vanguard, the annual plan administration fee charged to participants will be reduced to $55 annually ($13.75 per quarter). Loans. Although the Plan is designed for long-term savings, you can borrow from your account. Keep in mind that your paycheck would be reduced to repay the loan with interest, and that you could owe taxes and a 10% federal penalty tax if you fail to repay on time or when you leave Hexagon. Here are the new loan provisions: > > Minimum amount: $1,000. > > Maximum amount: 50% of your vested account balance up to $50,000 (or less if you have had an outstanding loan in the past 12 months). > > Maximum outstanding loans: 2 (one general purpose loan and one loan for the purchase of a principal residence). > > Repayment: up to 5 years for a general purpose loan; up to 15 years for a loan taken to purchase a principal residence. > > Origination fee (per loan): $50. > > Maintenance fee (per year): $25. Catch-up contributions. If you are age 50 or older, you are allowed to contribute above the regular IRS contribution limit to your retirement plan by making catch-up contributions. At John Hancock, you needed to make separate elections for your regular contributions and your catch-up contributions. At Vanguard, you will only need to make one election. If you were making both regular pre-tax or Roth after-tax contributions and catch-up contributions, only your regular contribution rate will carry over to Vanguard. Catch-up contributions will begin once you reach the regular IRS contribution limit. For current contribution limits, visit vanguard.com/contributionlimits. Once the transition to Vanguard is complete, you may want to review your contribution rate to ensure that you will contribute the amount that you wish to contribute by the end of the year. 4

5 YOUR NEW INVESTMENT LINEUP How to invest your money among stocks, bonds, and short-term reserves now and as you grow older is one of your most important financial decisions. When your retirement plan moves to Vanguard, you will be able to choose investments according to your personal preference. That s because your Plan s fund lineup will be divided between three tiers all-in-one investments, index investments, and actively managed investments. You can also access other investments through a fourth tier, the Vanguard Brokerage Option. Whether you re an experienced or novice investor, you can create a portfolio that fits your investment objective, time horizon, and comfort with risk. Tier 1: All-in-one investments Vanguard Institutional Target Retirement Funds provide a professionally maintained, diversified mix of investments that shifts its emphasis to more conservative investments as the year of At Hexagon, retirement nears. helping you achieve a comfortable retirement is a priority. Because we aim to make our retirement plan the 2060 Fund (VILVX) best place for you to 2055 Fund (VIVLX) save for your future, we re 2050 making Fund (VTRLX) some key changes. Investments in Target Retirement Funds are subject to the risks of their underlying funds. The year in the fund name refers to the approximate year (the target date) when an investor in the fund would retire and leave the workforce. The fund will gradually shift its emphasis from more aggressive investments to more conservative ones based on its target date. An investment in a Target Retirement Fund is not guaranteed at any time, including on or after the target date. Consider choosing the fund with the date that s closest to the year when you expect to retire. If you are already retired, consider choosing the Vanguard Institutional Target Retirement Income Fund. This fund seeks to provide current income and some capital appreciation to retirees Fund (VITLX) 2040 Fund (VIRSX) 2035 Fund (VITFX) 2030 Fund (VTTWX) 2025 Fund (VRIVX) 2020 Fund (VITWX) 2015 Fund (VITVX) 2010 Fund (VIRTX) Income Fund (VITRX) 5

6 Tier 2: Index investments If you wish to create your own diversified investment mix, you may want to start with the funds in this tier. Index investments can provide low-cost access to broad segments of the stock and bond market. Index funds, also known as passively managed funds, generally use a buy-and-hold strategy to track the performance of a given market. Why would anyone invest in an index fund and earn just what the market earns? Because index funds generally cost less to run than actively managed funds, whose managers try to outperform the market. Vanguard Total Bond Market Index Fund Institutional Shares (VBTIX) Vanguard Institutional Index Fund Institutional Shares (VINIX) Vanguard Extended Market Index Fund Institutional Shares (VIEIX) Vanguard Total International Stock Index Fund Institutional Shares (VTSNX) Tier 3: Actively managed investments The funds in this tier can help you fine-tune your portfolio with more specialized investments. They can be useful if you want to invest in a specific segment of the stock or bond markets. Delaware SMID Cap Growth Trust DFA US Targeted Value Portfolio Institutional Class (DFFVX) Dodge & Cox International Stock Fund (DODFX) Dodge and Cox Stock Fund (DODGX) Harding Loevner International Equity Portfolio Institutional Class (HLMIX) MassMutual Diversified SAGIC II PIMCO Total Return Fund Institutional Class (PTTRX) T. Rowe Price Institutional Large Cap Growth Fund Institutional Class (TRLGX) Tier 4: Vanguard Brokerage Option The Vanguard Brokerage Option (VBO ) allows you to choose investments from outside your Plan's core investment lineup. You will have access to individual stocks, bonds, options, and thousands of mutual funds from hundreds of fund families. Keep in mind that the risks are substantially different with this strategy and that you ll have to pay commissions and other costs. A note about risk All investing is subject to risk, including the possible loss of the money you invest. Bond funds are subject to the risk that an issuer will fail to make payments on time, and that bond prices will decline because of rising interest rates or negative perceptions of an issuer s ability to make payments. The PIMCO Total Return Fund may invest in derivatives. Derivatives are subject to a number of risks, such as liquidity risk, interest rate risk, market risk, credit risk, and management risk. A fund investing in a derivative instrument could lose more than the principal amount invested. Prices of mid- and small-cap stocks often fluctuate more than those of large-company stocks. Investments in stocks or bonds issued by non-u.s. companies are subject to risks including country/regional risk and currency risk. 6

7 WHAT THE TRANSITION MEANS TO YOU To ensure an orderly and accurate transition, activity in your account will need to be temporarily restricted. During this time you will not be able to: Move money between funds. Change which funds you invest your money in. Change how much of each paycheck you invest. Change the address on your account. Request a loan. Make unscheduled loan payments. Request withdrawals or distributions. Throughout the transition, bi-weekly contributions and scheduled loan payments will continue for employees actively working. If you no longer work for EcoSys Management, LLC, some information will not apply to you. KEY DATES December 28, 2016, at 4 p.m., Eastern time December 30, 2016, at 4 p.m., Eastern time January 3, 2017 Week of January 15, 2017 Transition begins. Deadline to move money between funds or request contribution allocation changes, loans, withdrawals, and distributions. All assets in your account are valued at John Hancock, which then sells them and transfers the proceeds to Vanguard.* All assets are invested in the Hexagon Employee Retirement Savings Plan at Vanguard.* Your balance transfers to similar funds. Transition ends. All non-brokerage account transactions are available through Vanguard. *Assets sold will be valued based on each fund s net asset value (NAV) at market close on December 30, 2016, and invested at Vanguard based on each fund s NAV at market close on January 3, Note: Assets moving to a Vanguard Institutional Target Retirement Fund, except for assets currently invested in a John Hancock Retirement Living Fund, will be temporarily invested in a short-term investment fund (STIF). Once your records have been reconciled, your money in the STIF will be invested in the Vanguard Institutional Target Retirement Fund with the target date closest to the year in which you will reach age 65. Any earnings accrued in the STIF will be allocated to your account on a prorated basis. From the time assets are sold by John Hancock until they are invested at Vanguard, your investments will be out of the market and will not receive any earnings or incur any losses based on market performance. The trade date is dependent upon timely receipt of the wire and good order of transfer documents from John Hancock. 7

8 Review your investments Because account activity will be on hold during the transition, it is important that you review your investments. For your long-term retirement needs, you should carefully consider the importance of a balanced and diversified investment portfolio, taking into account all your assets, income, and investments. Keep in mind that diversification does not ensure a profit or protect against a loss. WHAT WILL HAPPEN TO MY SAVINGS? To minimize the market effect on your money during the transition, your account balance and contributions will move to funds similar to those in which you currently invest, as shown in the following table: YOUR MONEY WILL MOVE FROM HERE... TO HERE... 3-Year Compound 5-Year Compound 10-Year Compound American Century Heritage Fund Investor Class (TWHIX) American Funds EuroPacific Growth Fund Class R5 (RERFX) American Funds Fundamental Investors Class R5 (RFNFX) American Funds Growth Fund of America Class R4 (RGAEX) American Funds Investment Company of America Class R5 (RICFX) American Funds Washington Mutual Investors Fund Class R5 (RWMFX) ClearBridge Aggressive Growth Fund Class I (SAGYX) DFA Emerging Markets Value Portfolio Institutional Class (DFEVX) DFA International Value Portfolio Institutional Class (DFIVX) DFA U.S. Small Cap Portfolio Institutional Class (DFSTX) Domini Social Equity Fund Institutional Class (DIEQX) Fidelity Advisor Total Bond Fund Institutional (FEPIX) Franklin Mutual Beacon Fund Z (BEGRX) Franklin Small-Mid Cap Growth Fund A (FRSGX) Fundamental All Cap Core Fund Invesco International Growth Fund Class R5 (AIEVX) Invesco Small Cap Growth Fund Class R5 (GTSVX) John Hancock Funds II Active Bond Fund Class 1 (JIADX) MassMutual Diversified SAGIC II Fund Delaware SMID Cap Growth Trust Harding Loevner International Equity Portfolio Institutional Class (HLMIX) Dodge and Cox Stock Fund (DODGX) T. Rowe Price Institutional Large Cap Growth Fund Institutional Class (TRLGX) Dodge and Cox Stock Fund (DODGX) Delaware SMID Cap Growth Trust Dodge & Cox International Stock Fund (DODFX) DFA US Targeted Value Portfolio Institutional Class (DFFVX) Dodge and Cox Stock Fund (DODGX) Dodge and Cox Stock Fund (DODGX) Delaware SMID Cap Growth Trust T. Rowe Price Institutional Large Cap Growth Fund Institutional Class (TRLGX) Harding Loevner International Equity Portfolio Institutional Class (HLMIX) Delaware SMID Cap Growth Trust 8

9 YOUR MONEY WILL MOVE FROM HERE... TO HERE... John Hancock Funds Blue Chip Growth Fund Class 1 (JIBCX) John Hancock II Capital Appreciation Fund Class 1 (JICPX) John Hancock II Core Bond Fund Class 1 (JICDX) John Hancock Funds Disciplined Value Fund Class R6 (JDVWX) John Hancock Funds Equity-Income Fund Class 1 (JIEMX) John Hancock Funds Fundamental Large Cap Value Fund Class I Fund (JFVIX) John Hancock II Global Bond Fund Class 1 (JIGDX) John Hancock II High Yield Fund Class 1 (JIHDX) John Hancock II International Core Fund Class I (GOCIX) John Hancock Funds International Growth Fund Class 1 (GOIOX) John Hancock II International Value Fund Class I (JIVIX) John Hancock II Invest Quality Bond Fund Class 1 (JIQBX) John Hancock II Mid Cap Stock Fund Class 1 (JIMSX) John Hancock Funds New Opportunities Fund Class 1 (JISOX) John Hancock II Real Return Bond Fund Class 1 (JIRRX) John Hancock Funds Retirement Living through 2010 Portfolio Class 1 (JIRRX) John Hancock Funds Retirement Living through 2015 Portfolio Class 1 (JLAOX) John Hancock Funds Retirement Living through 2020 Portfolio Class 1 (JLDOX) John Hancock Funds Retirement Living through 2025 Portfolio Class 1 (JLEOX) John Hancock Funds Retirement Living through 2030 Portfolio Class 1 (JLFOX) John Hancock Funds Retirement Living through 2035 Portfolio Class 1 (JLHOX) John Hancock Funds Retirement Living through 2040 Portfolio Class 1 (JLIOX) John Hancock Funds Retirement Living through 2045 Portfolio Class 1 (JLJOX) John Hancock Funds Retirement Living through 2050 Portfolio Class 1 (JLKOX) John Hancock Funds Retirement Living through 2055 Portfolio Class 1 (JLKUX) John Hancock Retirement Living through 2060 Portfolio Class 1 (JRETX) T. Rowe Price Institutional Large Cap Growth Fund Institutional Class (TRLGX) Dodge and Cox Stock Fund (DODGX) Dodge & Cox International Stock Fund (DODFX) Harding Loevner International Equity Portfolio Institutional Class (HLMIX) Dodge & Cox International Stock Fund (DODFX) Delaware SMID Cap Growth Trust DFA US Targeted Value Portfolio Institutional Class (DFFVX) Vanguard Institutional Target Retirement 2010 Fund (VIRTX) Vanguard Institutional Target Retirement 2015 Fund (VITVX) Vanguard Institutional Target Retirement 2020 Fund (VITWX) Vanguard Institutional Target Retirement 2025 Fund (VRIVX) Vanguard Institutional Target Retirement 2030 Fund (VTTWX) Vanguard Institutional Target Retirement 2035 Fund (VITFX) Vanguard Institutional Target Retirement 2040 Fund (VIRSX) Vanguard Institutional Target Retirement 2045 Fund (VITLX) Vanguard Institutional Target Retirement 2050 Fund (VTRLX) Vanguard Institutional Target Retirement 2055 Fund (VIVLX) Vanguard Institutional Target Retirement 2060 Fund (VILVX) 9

10 YOUR MONEY WILL MOVE FROM HERE... TO HERE... John Hancock II Small Company Value Fund Class 1 (JISVX) JHVIT Small Cap Value Trust (JESVX) JHVIT Strategic Income Opportunities Trust (JESNX) JHVIT Total Stock Market Index Trust (JETSX) JHVIT Value Trust (JEVLX) JPMorgan U.S. Equity Fund Class R5 (JUSRX) PIMCO Global Bond Fund (Unhedged) (PADMX) PIMCO Real Return Fund Class A (PRNTX) Royce Opportunity Fund Investment Class (RYPNX) DFA US Targeted Value Portfolio Institutional Class (DFFVX) Vanguard Institutional Index Fund Institutional Shares (VINIX) Dodge and Cox Stock Fund (DODGX) T. Rowe Price Institutional Large Cap Growth Fund Institutional Class (TRLGX) T. Rowe Price Equity Income Fund (PRFDX) Dodge and Cox Stock Fund (DODGX) T. Rowe Price Spectrum Income Fund (RPSIX) Vanguard Short-Term Federal Fund Admiral Shares (VSGDX) Vanguard Small-Cap Growth Index Fund Admiral Shares (VSGAX) Vanguard Small-Cap Value Index Fund Admiral Shares (VSIAX) American Funds American Balanced Fund Class R5 (RLBFX) BlackRock Global Allocation Fund Class I (MALOX) Franklin Mutual Global Discovery Fund Z (MDISX) John Hancock II International Small Cap Fund Class 1 (JIIMX) John Hancock Funds Lifestyle Aggressive Portfolio Class 1 (JILAX) John Hancock Funds Lifestyle Balanced Portfolio Class 1 (JILBX) John Hancock Funds Lifestyle Conservative Portfolio Class 1 (JILCX) John Hancock Funds Lifestyle Growth Portfolio Class 1 (JILGX) John Hancock Funds Lifestyle Moderate Portfolio Class 1 (JILMX) John Hancock Funds Natural Resources Fund Class 1 (JINRX) John Hancock II Real Estate Securities Fund Class 1 (JIREX) John Hancock Funds U.S. Growth Fund Class 1 (JHUPX) JHVIT Financial Industries Trust (JEFSX) JHVIT Science & Technology Trust (JESTX) JHVIT Utilities Trust (JEUTX) Oppenheimer Global Fund Class A (OPPAX) PIMCO All Asset Fund Administrative Class (PAALX) T. Rowe Price Health Sciences Fund (PRHSX) MassMutual Diversified SAGIC II Fund Vanguard Extended Market Index Fund Institutional Shares (VIEIX) Vanguard Institutional Target Retirement Fund with the target date closest to the year you will reach age

11 YOUR MONEY WILL MOVE FROM HERE... TO HERE... T. Rowe Price Science & Technology Fund Advisor Class (PASTX) Templeton World Fund Class A (TEMWX) Vanguard Energy Fund Admiral Shares (VGELX) Vanguard Institutional Target Retirement Fund with the target date closest to the year you will reach age 65. After the transition, you can move your money or redirect your contributions to another fund in the Plan s new lineup at any time.to Y CHECK YOUR BENEFICIARY DESIGNATION Your beneficiary designation for the EcoSys Management, LLC 401(k) Profit Sharing Plan and Trust at John Hancock will carry over to the Hexagon Employee Retirement Savings Plan at Vanguard. Now may be a good time to check that your beneficiary designation listed on johnhancock.com is still accurate or to name beneficiaries if you haven't done so yet. Before the transition to Vanguard, you can name or update your beneficiaries at johnhancock.com. After the transfer to Vanguard, you can do so by logging on to your account at vanguard.com/retirementplans. SPECIAL ACTION REQUIRED FOR CERTAIN PARTICIPANTS If you are currently a Power of Attorney (POA), that status will not carry over to Vanguard. Plan participants will need to contact Vanguard as soon as the transfer has ended to request the POA paperwork. Vanguard's contact information has been included on the last page of this brochure contribution limits Employee pre-tax and Roth contributions to $18,000. Employee and employer contributions to $54,000 or 100% of your pay, whichever is less. If you are age 50 or older, or will turn 50 by year s end, and you contribute the maximum allowed, you may contribute an extra $6,000. This additional amount is allowed as a catch-up contribution. For more information, visit anguard.com/contributionlimits. 11

12 CONNECT WITH VANGUARD Once the transition to Vanguard is complete, you will be able to access your new Hexagon Employee Retirement Savings Plan in any of the following ways. Online. Log on to your account at vanguard.com/retirementplans for 24-hour access to information about your account, your investments, and Vanguard s advice services. On your mobile device. Go to vanguard.com/bemobile to download the Vanguard app so you can access your account on the go. By phone. Call to reach Vanguard s 24-hour interactive VOICE Network. You ll need your Social Security number and a personal identification number (PIN) to use VOICE. To create a PIN, follow the prompts when you call. Or you can speak with a Vanguard Participant Services associate Monday through Friday from 8:30 a.m. to 9 p.m., Eastern time. Join the Vanguard community on our social media channels. You ll have access to Vanguard experts and be able to get up-to-the-minute news and views, attend live web events, participate in live chats, and interact with other Vanguard investors. In the meantime, if you wish to access your account prior to the transfer to Vanguard, contact John Hancock at johnhancock.com or For more information, visit vanguard.com, or call for funds in your plan and for funds offered through Vanguard Brokerage Services, to obtain a prospectus or, if available, a summary prospectus. Investment objectives, risks, charges, expenses, and other important information are contained in the prospectus; read and consider it carefully before investing. A stable value investment is neither insured nor guaranteed by the U.S. government. There is no assurance that the investment will be able to maintain a stable net asset value, and it is possible to lose money in such an investment. Collective trusts and separately managed accounts are not mutual funds. These investments are available only to tax-qualified plans and their eligible participants. Investment objectives, risks, charges, expenses, and other important information should be considered carefully before investing. Vanguard, Connect with Vanguard, VBO, Admiral, and VOICE are trademarks of The Vanguard Group, Inc. Vanguard Brokerage Services is a division of Vanguard Marketing Corporation, Member FINRA. Vanguard Marketing Corporation, Distributor of the Vanguard Funds. BBBBLHVY