Plan Fee Disclosure for the Retirement Plan Fiduciary Rule 408b-2

Transcription

1 Plan Fee Disclosure for the Retirement Plan Fiduciary Rule 408b-2 From The Union Central Life Insurance Company July 15, 2013 OZARK MOTOR LINES INC 401K PLAN ATTN: MIKE HOPPER PO BOX MEMPHIS, TN /15/2013

2 Services and Fees Disclosure Background This Services and Fees Disclosure statement contains information about the products and services that The Union Central Life Insurance Company (Union Central) provides to your company s retirement plan. Specifically, this information is designed to help you fulfill your duty as a plan fiduciary in accordance with the new regulations issued by the U.S. Department of Labor (DOL) under Section 408(b)(2) of the Employee Retirement Income Security Act of 1974 (ERISA). The purpose of this disclosure is to satisfy the 408(b)(2) statutory exemption and the new requirements of Rule 408b-2. As the plan fiduciary, you are responsible for determining if the fees you are paying for the services you receive are reasonable. Under the new regulations, you will fulfill this responsibility only if a written disclosure is provided to you by your service provider, Union Central. The written disclosure must describe the services provided and the costs associated with each service. It must also detail the direct and indirect compensation that Union Central, as the service provider, receives. This Services and Fee Disclosure is based on the regulations set forth by the DOL. We believe it contains the information you need to fulfill this fiduciary responsibility. This statement is organized as follows: I. Our Investment Product II. Our Direct and Indirect Fees III. Payments to Financial Professionals IV. Plan Services and Associated Fees For Help: For help in understanding this document or for more information detailing our services and fees (including revenue sharing arrangements), please contact your Client Services Representative (CSR) at This Plan Fee Disclosure shows all of the services we provide to you, as well as direct and indirect compensation that we, our affiliates and subcontractors receive for these services. Table 1 of this disclosure breaks out the specific components of the Total Annual Operating Expense which represents all fees and expenses that reduce the rate of return of each investment option in your plan s investment lineup. A supplement to this document is the Participant Fee Disclosure. Table 3 of the participant disclosure presents the Total Annual Operating Expense but does not specifically identify each fee. The expense is shown as both an annual percentage and an annual dollar amount based on the investment of $1,000 in each of the funds in your plan s investment lineup as prescribed under the disclosure rules. Further, the Participant Fee Disclosure identifies each of your plan s investment options by name and category. It also includes performance data, benchmarks, and interest rate information for the Deposit Account. Your plan administrator is responsible for providing the Participant Fee Disclosure document to your plan participants. This is a requirement of Rule 404a-5 (Department of Labor 29 CFR Section a-5) 2

3 I. Our Investment Product This section provides an overview of the services Union Central provides. We believe our fees are reasonable based on the level and quality of services we provide to you as your plan s fiduciary and to your plan participants. You have selected an allocated non-registered group variable annuity contract(contract) issued by Union Central as the funding vehicle for your participant directed retirement plan. This Contract holds in trust and segregates the contributions made to your plan into an individual account specifically for the benefit of each of your plan participants. As the recordkeeper for your plan, Union Central takes direction from each of your participants regarding the investment direction of their contributions. Investment Options The investment platform of options available under our Contract to you as the plan s fiduciary are selected and monitored by our Investment Products Group (IPG). This platform includes a diversified array of registered mutual funds all of which are segregated into our separate accounts. IPG monitors the performance of the funds on our platform using our proprietary Investment Selection Evaluation System (ISES). This system provides the basis for systematically selecting, monitoring, adding and/or deleting investments from our platform. As an insurance company, we are also able to offer one of two unique investment options that include a principal preservation objective: (i) the Guaranteed Investment Account, and (ii) the Stable Fixed Account. Our Guaranteed Investment Account provides a guarantee of principal while declaring a competitive interest rate quarterly. This account represents an investment in the General Asset Account of The Union Central Life Insurance Company. These assets include corporate and government debt, equities, and commercial real estate. The investments held in this account are selected to enable us to meet our obligations with respect to all fixed products that the company issues, including life insurance. Based on this need, we take a long-term investment approach in managing these assets. The account is one of the value-adds we provide to you as a client of Union Central. Our Stable Fixed Account provides a shorter investment horizon and is a sub-set of the assets in the Guaranteed Investment Account. This investment option is designed to protect principal and earn an interest rate we set monthly. We believe this option provides a value-add to you and your plan participants. You have a responsibility as the plan fiduciary of your plan to select and monitor which of our separate account investment options and/or which of our guaranteed account investment options to include in your plan s lineup. To assist you in this duty and as a requirement of the new disclosure regulations, Table 1 lists your plan s current investment options and the fees associated with those options. Asset Allocation Models and other Participant Education To assist your plan participants in creating a diversified investment portfolio, we have secured the services of a third party financial expert, the Fund Evaluation Group, to design asset allocation models. These are available as educational tools to your plan participants. As part of the asset allocation process, participants answer a set of specific questions which are available online or in paper format to determine their personal risk tolerance. The score they receive then steers them to a specific model portfolio and with the help of our Investment Worksheet, they can create their own portfolio based on the guidance of experts. In addition to these model asset allocation portfolios, we provide general investment education and guidance, savings calculators and other educational materials. These are available on our secure website 24/7. This gives your plan participants convenient access to these tools at any time. Recordkeeping Your plan allows your participants to direct the investment of their own contributions. Your plan document specifies which contributions they can direct. As noted above, as your plan s recordkeeper, your participants give us instructions on how to invest their contributions based on the options available under your plan. They can do this via: Our secure website 24/7 Our Call Center Paper sent to our Home Office This is an important responsibility and Union Central maintains the proper checks and balances to ensure the contributions are invested in accordance with the participant s instruction and in a timely manner. 3

4 Further, on a daily basis, we purchase and redeem shares of these investment options based on their instructions. All transactions are detailed for the participant s review on our secure website. Because we are an insurance company, our contract satisfies a plan s obligation to hold plan assets in a seperate trust. In addition, through our separate accounts, we execute trades on behalf of your plan. By providing these services, this eliminates the cost of engaging another party to perform these services. We also act as a transfer agent on the daily trading of these funds through our separate accounts. As a result, we may receive 12b-1 and sub-transfer agency fees called revenue sharing for performing these services. While these fees are retained by Union Central, they are considered in our pricing. For the specific fee amounts, please see Table 1 provided later in the Direct Fee Section of this disclosure. One of the requirements of Rule 408b-2 is that when recordkeeping fees are offset by revenue sharing or other receipt of compensation from third parties, we, as a recordkeeper, are responsible for disclosing this fact. Table 1 details a reasonable and good faith estimate in accordance with this particular requirement of the fees we receive in the form of revenue sharing or Sub TA fees paid to us. As recordkeeper, we also provide plan level investment account summaries and information to complete the annual required DOL and IRS plan filings. Based on our Service Agreement with you, we may also provide other services such as disbursing plan assets, providing Form 1099 information, allocating forfeitures and/or transferring assets. The most common method selected by plan fiduciaries for paying the cost of our Recordkeeping and Administrative Services is through the asset-based charge under the Contract detailed in Tables 1 and 2. However this cost can be billed to you directly. You have the option at any time to change this method. Website and Participant Communications We dedicate a great deal of our resources to providing your plan participants with access to a secure website through which they can effectively and efficiently manage their retirement account. This site is generally available 24/7 and enables plan participants to gather information about their account, including fund values on a daily basis. As your service provider, we want to help with some of the administrative responsibilities you take on in sponsoring a qualified retirement plan. We provide information to you as the plan sponsor through our Did You Know notices. This program provides timely communications about operational and administrative changes to your plan as well as notices regarding any investment changes. These are then available on your plan sponsor website for future reference when you need them. Quarterly, we provide participant benefit statements that summarize activity in the participant s account for the preceding calendar quarter. Participants may elect to receive the statements electronically or mailed directly to their home address. Specific educational information about your plan s investments is also available on our secure website. Our easy to read Fund Fact Sheets are available and updated quarterly. Links to the fund s prospectus are available 24/7 as well. We also provide informative plan sponsor and participant newsletters that contain basic investment and retirement related articles. Proxy Voting As the separate account owner, we are responsible for all voting related to these funds. As a result, we do not pass through any voting privileges with respect to these funds. IPG conducts ongoing monitoring of our platform and in this role, votes proxies for all funds on our platform. The selection and monitoring process is absorbed in the fee we assess your plan under our Contract. The expertise of IPG helps you in fulfilling your duties as the plan s fiduciary. Fiduciary Guidance As part of our Contract, we have created a Fiduciary Handbook which provides extensive guidance on best practices for operating a participant directed plan. Information about how you can administer your plan under Section 404(c) of ERISA and the related regulations from the DOL can be found in the handbook as well. The cost for providing this service is covered through our expense under the Contract. Fiduciary Investment Safeguard We offer this fiduciary guarantee and provide a document that specifies how you can comply. As long as you administer your plan in accordance with certain conditions designed to ensure compliance with Section 404(c) and the related DOL regulations, we will indemnify you, as the plan s fiduciary, against legal costs related to litigation that might arise due to your prudent operation of your plan. 4

5 Fiduciary Status As the plan fiduciary, you are responsible for selecting your plan s investment lineup. Your plan participants select their own investment options and Union Central has no discretion over this process. Additionally, we carry out administrative and recordkeeping services based on your direction as the plan s fiduciary. As a result, we have no discretion over your plan nor are we a fiduciary to your plan under ERISA. Ameritas is not a registered investment advisor. Services Guarantees Providing timely and accurate customer service to you and your participants is a key priority for Union Central. We provide Service Guarantees that cover certain critical activities and turnaround times. Because we believe in what we are doing for your plan, we pledge to continuously meet these service standards. If we fail to meet the metrics we have established, we will refund the fees we are paid for that service. A listing of our Service Guarantees can be found on your plan s website. Location of Services Our services are provided from our locations in the Midwest (Lincoln, NE and Cincinnati, OH). The CSR is familiar with your plan and its unique requirements. You may call a CSR for any service request you may have. 5

6 II. Our Direct and Indirect Fees For all of the services described above (collectively referred to as Plan Administrative and Recordkeeping Services ), we charge fees under our Contract using one or more of the following methods: (i) Asset-based fees These are deducted from the plan assets, specifically each participant account. These can be billed directly to you as the plan fiduciary, if you so choose. (ii) Billable-fees These are invoiced to you annually and include the standard per participant fee and/or the annual compliance fee, if applicable, and other fees for services you specifically requested during the year. You have the option of deducting these fees from the participant s account either on a pro-rata basis or in an equal amount based on the number of participants in your plan. If we do not receive payment of the billable fees in a timely manner, we reserve the right to deduct these fees from the plan s assets. Each investment option offered under your plan has a fee for its fund management. These fees are equal to the Estimated Net Revenue to an Investment Company outlined in Table 1. The Contract which you have with Union Central enables us to collect fees for the services we provide. For purposes of simplicity and clarification, the fees described in the Contract are reflected in the General Plan Administrative Fees in Table 2. The fees specific to your ESP Contract (UC 64348) includes: (i) a Net Investment Factor for each Separate Account, (ii) a General Expense Charge, and (iii) an Annual Recordkeeping Fee. See Tables 1 and 2 for a summary of the fees that apply to your plan. The language we use in this disclosure to describe the fees charged under the Contract is not intended to supersede or contradict the language in the Contract. For any such unintended differences, the Contract language will apply. For investment related fee information as of the date of this disclosure document, please see Table 1. Table 2 outlines our standard fee schedule that may be billed to your plan and/or its participants. Fees for individual participant services such as distributions, QDRO calculations, loan initiations and annual loan maintenance are charged to individual participant accounts and are outlined in Table 2. 6

7 Table 1 Asset-Based Fees Investment Company (IC) Net Revenue Ameritas Revenue A Investment Options Available to this Plan B Ending Balance C Estimated Net Revenue to IC (%) D Estimated Net Revenue to IC ($) E Short Term Trading Fee F 12b-1 G Sub TA and Service H Admin and RK I Estimated Revenue to Ameritas (%) J Estimated Revenue to Ameritas ($) American Century Heritage, Investor Class $271, % $2, % 0.25% 0.75% 1.00% $2, American Century International Growth, Investor Class $290, % $3, % / 60 Days 0.00% 0.25% 0.75% 1.00% $2, Baron Small Cap, Retail Shares $235, % $2, % 0.15% 0.75% 1.15% $2, Calvert Cash Reserves Institutional Prime Fund** $203, % $ % 0.08% 0.75% 0.84% $1, Calvert Income Fund, Class I** $370, % $1, % / 7 Days 0.00% 0.23% 0.75% 0.98% $3, Calvert Large Cap Value Fund, Class Y** $343, % $2, % / 30 Days 0.00% 0.30% 0.75% 1.05% $3, Calvert VP S&P MidCap 400 Index** $100, % $ % 0.13% 0.75% 0.88% $ Calvert VP S&P 500 Index** $571, % $1, % 0.16% 0.75% 0.91% $5, Calvert VP SRI Balanced** $185, % $1, % 0.13% 0.75% 0.88% $1, Deposit Account $1,015, % $ % 0.00% 0.18% 0.18% $1, Morgan Stanley IF US Real Estate, Class P MFS VIT Growth Series, Initial Class MFS VIT Investors Trust Series, Initial Class MFS VIT Total Return Series, Initial Class Oppenheimer Global/VA, Non-Service Shares PIMCO High Yield, Administrative Class Royce Pennsylvania Mutual, Service Class T. Rowe Blue Chip Growth, Advisor Class T. Rowe Price Mid Cap Value, Advisor Class $285, % $2, % 0.10% 0.75% 1.10% $3, $356, % $2, % 0.25% 0.75% 1.00% $3, $114, % $ % 0.25% 0.75% 1.00% $1, $26, % $ % 0.25% 0.75% 1.00% $ $33, % $ % 0.20% 0.75% 0.95% $ $63, % $ % 0.00% 0.75% 1.00% $ $170, % $1, % 0.10% 0.75% 1.10% $1, $967, % $5, % 0.15% 0.75% 1.15% $11, $438, % $2, % 0.15% 0.75% 1.15% $5, Third Avenue International Value, Institutional Class $12, % $ % / 60 Days 0.00% 0.35% 0.75% 1.10% $ Total $6,055, $31, $54, Column B reflects the assets invested in each of the funds offered in your plan as of July 15, This balance is used as the basis for calculating approximate total fees in Columns D and J. A portion of the asset-based fees is deducted from the investment earnings and charged based on the assets invested each day. Column C reflects the revenue to investment companies net of the fees displayed in Columns F and G. Column D represents the estimated net revenue to the Investment Company (Column B x Column C). This includes their investment management fees, and may include other fees that might apply. A description of these fees may be found in the fund s prospectus or other sales literature. Column E represents fees charged by an Investment Company to participants who hold their assets for less than a predetermined period of time, also known as redemption fees. The percentage fee reflected is assessed if assets are held less than the days indicated. A complete description of these limitations and applicable fees may be found in the fund s prospectus. 7

8 Column F is the 12b-1 fees that are paid to us to offset our distribution and marketing expenses. Column G is the sub-transfer agency and service agreement fees remitted to us by the Investment Company to offset the recordkeeping costs associated with administering individual participant accounts. Column H includes our fees that are asset-based. It includes commissions paid to your advisor. Column I represents the total fee paid to us. This includes our fees (Column H) plus Columns F and G. Column J represents the total estimated fee paid to us (Column B x Column I). The Total Annual Operating Expense is the sum of Columns C, F, G, and H, and represents all fees and expenses that reduce the rate of return of each investment option. Funds marked with an ** are considered an affiliated fund. Deposit Account Market Value Adjustment If your plan s participants are invested in our Deposit Account, participant withdrawals from such investment option and your termination of the Contract may trigger a market value adjustment. The Participant If a participant withdraws or transfers money out of the Deposit Account, other than for a benefit event, in excess of the greater of $2,000 or 5% of the participant s account balance in such investment option at the beginning of the current calendar quarter, a market value adjustment will apply if current market rates are higher than the blended rate earned by the participant of such investment account. At the time a participant makes a withdrawal or transfer of money out of the Deposit Account, the participant will be notified of the amount of the market value adjustment charge before the transfer is complete. The participant can either accept the charge or cancel the transaction. If current market rates are lower than current credited rates, a market value adjustment will not apply. It also does not apply to transfers affected through an automatic rebalancing program. It does not apply to a benefit event as defined in the Contract, which includes withdrawals due to retirement, termination of employment, a hardship distribution, death benefits or loan withdrawals. The Plan If you elect to terminate your Contract, a market value adjustment will apply to all plan assets held in the Deposit Account. You, as the plan fiduciary, will have a choice of either receiving a lump-sum payment of all of your plan assets invested under the Contract less the applicable market value adjustment on those assets held in the Deposit Account or we can pay you the Plan assets invested in the Deposit Account in approximately 10 annual payments beginning six months after the date of Contract termination. The interest rate credited during the payout period will be the interest rate credited per contract term less 1%. In simple terms, the market value adjustment is calculated by comparing current market rates to the rates being credited to a participant s account. If the current market rates are higher than the current credited rates, the difference in rates is discounted over the remaining maturity period of the assets. The difference between the discounted value and the current account value is the market value adjustment a participant would be charged. Revenue Sharing In our role as distributor and transfer agent for the investment options under the Contract, we may receive distribution fees (12b-1 fee) from funds that are investment options under the Contract, and sub-transfer agency fees from the Investment Company. The fees paid to us are used by us to offset expenses we incur in providing services to your plan. Rule 408b-2 provides that when recordkeeping fees are offset by revenue sharing or other receipt of compensation from third parties, we, as a recordkeeper, are responsible for disclosing a reasonable and good faith estimate of our recordkeeping services and applicable fees, which may be affected by the actions of third parties beyond our immediate control. For fund specific revenue sharing payments, please see the list of investment options in Table 1. Our affiliate Calvert Investment Management, Inc. (Calvert) is the investment manager for Calvert funds. As an investment manager, Calvert receives an investment management fee that is part of the expense ratio of Calvert funds offered as investment options under our investment platform. Calvert may also pay us revenue sharing under its investment options offered through our investment platform. If IPG makes changes to our investment platform, or funds merge or terminate that impact your plan, we will provide you and your participants with advance notice at least 30 and no more than 60 days prior to the effective date of the change. If you provide us written notification of your objection to the change, we will work with you to implement an alternate selection. During this notification period, participants can select a different investment based on the plan s available options. Data for unaffiliated funds is obtained from sources external to us. We cannot guarantee the accuracy, completeness or timeliness of this data. We request information from each unaffiliated fund, and in the event that such information is not received and is not shown in the chart, please contact the issuer of that fund for information concerning that fund. 8

9 Table 2 Schedule of Fees Description of Service Paid By Fee Basis General Plan Administrative Fees Administrative and Recordkeeping This fee is included in the asset-based charge reflected in column H of Table 1, and is not in addition to the amount shown in Table 1 Deposit Account 0.18% First $500, % Next $500, % Over $1,000,000 Separate Accounts 1.28% First $500, % Next $500, % Over $1,000,000 Recordkeeping Fee Deducted from Participant Account, per capita $0 Electronic Submission, Total Assets > $500,000 Electronic Submission, Total Assets < $500,000 $18 Per Participant/Weekly Submission $18 Per Participant/Semi-monthly or Bi-Weekly Submission $18 Per Participant/Monthly Submission $12 Per Participant/Quarterly or Semi-Annual Submission $6 Per Participant/Annual Submission Paper Submission $72 Per Participant/Weekly Submission $48 Per Participant/Semi-monthly or Bi-Weekly Submission $36 Per Participant/Monthly Submission $24 Per Participant/Quarterly or Semi-Annial Submission $12 Per Participant/Annual Submission $12 Per Participant for Non-Contributing Plans Termination Charges Billed to Plan Sponsor $312 Flat Rate at Termination Additional ERISA Services Billed to Plan Sponsor $150 Per Hour Individual Fees Distribution Fee Deducted from Participant Account $35 Per Distribution QDRO Fee Deducted from Participant Account $75 Per Calculation Overnight / Wire Fee Deducted from Participant Account $15 Per Mailing 9

10 We have engaged the Fund Evaluation Group to build asset allocation models. We pay a portion of the fees we collect to them for the services they perform on our behalf. General plan administrative expenses that may be deducted from participant accounts may vary based on the number of participants in your plan, the average account balance of all plan participants, or individual participant account balances as a percent of total balances. 10

11 III Payments to Financial Professionals Product Sale As the plan fiduciary, you purchased our Contract through a sales agent (Advisor). Part of the Advisor s responsibilities in the sale of the Contract is to provide you, as the plan fiduciary, with information about the Contract. The Advisor can also provide information on basic investment principles and education on how our asset allocation model portfolios can assist plan participants in making sound investment decisions regarding their contributions to the plan. The Advisor is not a fiduciary as defined under ERISA to your plan or to your plan participants. Union Central has sold our Contract to you through an Advisor who is licensed by the state and appointed by us to sell the Contract. Our Contract is an exempt security under federal securities laws. However FINRA, the self-regulatory organization for broker-dealers, requires that Advisors who are registered representatives must be paid any compensation under the Contract through a broker-dealer. The Advisor is compensated for services through a sales commission. Sales Commission A sales commission is paid by us to the Advisor through his or her agency and/or broker-dealer, if appropriate. In addition, there may be a second person responsible for supervising the Advisor sale of the Contract to your plan. This person may receive an override sales commission for supervising the Advisor. These commissions will generally be shared by the Advisor, the Advisor s agency and the broker-dealer, which may be our affiliate Ameritas Investment Corp. ("AIC"). Neither AIC nor the Advisor, as a registered representative of AIC, are a fiduciary as defined under ERISA to your plan or plan participants. The commissions that we pay for the sale of the Contract, and which you pay indirectly through our fees, are reflected in the Schedule A of your 5500, and are included in the fees reflected in Table 1. The exact amount of the commission received by the Advisor and by his supervising agency or broker-dealer is determined by those parties and may be subject to many factors set forth in agreements by those parties, and may be influenced by events and circumstances unrelated to your Contract. AIC may retain up to 50% of the commission paid for its supervisory role, or we may pay AIC directly for these services. The rate and method is dependent on the contract held by the Advisor with AIC, and may be influenced by events and circumstances unrelated to your Contract. When AIC and its registered representatives generally distribute products, in addition to commissions paid for distribution, they may receive other distribution expenses, marketing support allowances, conference sponsorship fees and production incentive bonuses. Advisor: Agency: Broker Dealer: Advisor: Agency: C R BROWN UCL FINANCIAL GROUP A Registered Representative of Ameritas Investment Corp., Member FINRA/SIPC and a licensed insurance agency. DAVID M BROWN UCL FINANCIAL GROUP 11

12 IV. Plan Services and Associated Fees Additional Services If you enter into a services agreement with us, we will provide additional services. Plan Compliance Services We offer services to assist you in keeping your plan in compliance with all IRS and DOL rules and regulations regarding retirement plans. Each year, we will request an updated employee census and compare it with our records. We will follow up with any apparent inconsistencies or irregularities. Our plan sponsor reports will be compared to the information we collected throughout the year and reconciled with what we received from you. Forfeitures and employer contributions will be allocated according to the terms of your plan document. Employer contributions will be allocated in accordance with your plan document and may be done on a pro-rata basis, a new comparability basis, or integrated with the Social Security taxable-wage base. We will perform all required non-discrimination testing, including those under Internal Revenue Code sections 401(k) and 401(m), 410(b), 401(a), and 404. An experienced and credentialed Administration Specialist (who performs the compliance testing) is assigned to your plan and works closely with the CSR who serves as the primary point of contact for you. Required governmental filings (Form 5500 and applicable schedules) are prepared in advance of filing dates and posted to a secure wedsite so that you can easily sign your forms in accordance with the DOL s online EFAST2 procedures. The required Summary Annual Report will be prepared for your review. ERISA Plan Services We offer the services of our experienced staff of professionals to assist you, sometimes in coordination with your legal counsel, in selecting the design for your retirement plan. The plan will be designed to meet your company s particular needs along with the retirement goals you have for your employees. We will draft a plan document to facilitate the selected design using an IRS pre-approved document, and provide a Summary Plan Description and keep it updated. Upon request, we can prepare and file an IRS determination letter for your plan, amend and update your plan and related documents to meet your needs or as laws and regulations require. Our ERISA Plan Services Team works in conjunction with the Administration Specialist and CSR who are familiar with your plan. Schedule of Fees Under Services Agreement A schedule of service fees is reflected in the chart below. Plan Compliance and ERISA Plan Services may be charged as either an asset-based charge assessed with the Plan Administrative and Recordkeeping Charge (included in Table 1 above) or as a billable charge to you as the plan fiduciary or surrendered from participant accounts, as determined by you. Table 3 Administration Service Fees Description of Service Paid By Fee Basis General Plan Administrative Fees Annual Testing Fee Deducted from Participant Account, per capita Flat Rate $1,500 Less than 100 Eligible Participants $2, or more Eligible Participants Per Participant $14 Less than 100 Eligible Participants $ or more Eligible Participants Plan Amendment Fees Billed to Plan Sponsor $225 Flat Rate Discount for Safe Harbor Contribution Deducted from Participant Account, per capita ($350) Discount Applied to Annual Testing Fees Fee Credit ($3,500) Additional Administrative Services Billed to Plan Sponsor $125 Per Hour 12

13 Description of Service Paid By Fee Basis 13