YOUR GUIDE TO GETTING STARTED

Transcription

1 The Varian Medical Systems, Inc. Retirement Plan Invest in your retirement and yourself today, with help from the Varian Medical Systems, Inc. Retirement Plan and Fidelity. YOUR GUIDE TO GETTING STARTED

2 Invest some of what you earn today for what you plan to accomplish tomorrow. Dear Varian employee: It is our pleasure to offer you the opportunity to participate in the Varian Medical Systems, Inc. Retirement Plan (the Plan ). If you have not enrolled in the Plan within 60 days from your date of hire, you will be automatically enrolled in the Plan as explained in the Frequently asked questions about your Plan section of this enrollment guide. (You may also decline participation, as explained in the Frequently asked questions about your Plan section.) The Plan offers a convenient, taxadvantaged way to save for retirement. Benefit from: Tax savings now. Your pretax contributions are deducted from your pay before income taxes are taken out. This means that you may actually lower the amount of current income taxes withheld each period. It could mean more money in your take-home pay versus saving money in a taxable account. Matching contributions. Varian Medical Systems, Inc. (the Company ), helps your contributions grow by matching your pretax, Roth, and after-tax contributions, up to certain limits. Auto enrollment. The Company will automatically enroll you in the Plan 60 days following your date of hire. Your contribution percentage will be set at 6% and will be applied as pretax contributions. You will have this 60-day time frame to decline participation or make changes. Annual Increase Program. Fidelity s Annual Increase Program (AIP) is an easy way to automatically increase your savings on a regular basis. Each January, your contribution rate will automatically increase by 1% until you reach the AIP cap limit of 10% (of course, you can voluntarily choose a contribution rate of up to a total of 25% on a pretax and/or Roth basis). Convenience. Your contributions are automatically deducted regularly from your paycheck. Tax-deferred savings opportunities. You pay no taxes on any earnings until you withdraw them from your account, enabling you to keep more of your money working for you now. Portability. You can roll over eligible savings from a previous employer into this Plan. You can also take your vested Plan account balance with you if you leave the company. Investment options. You have the flexibility to select from investment options that range from conservative to aggressive, making it easy for you to develop a well-diversified investment portfolio. Catch-up contributions. If you make the maximum contribution to your Plan account, and you are 50 years of age or older during the calendar year, you can make an additional catch-up contribution of $6,000 in Roth (after-tax contributions). The Roth 401(k) contribution option is available to you. A Roth 401(k) contribution to the Plan allows you to make after-tax contributions and take any associated gains completely tax free at retirement as long as the distribution is a qualified one. To learn more about what your Plan offers, see Frequently asked questions about your Plan later in this guide. Sincerely, Fidelity 401(k) Center Participate in your plan and invest in yourself today.

3 Count on us to support you every step of the way. Investing in yourself is easy with the Varian Medical Systems, Inc. Retirement Plan. The good news is, you re already enrolled. Now use this guide to make the most of this opportunity. Step Decide how much to invest. Step Determine investments that are right for you. Step Review and confirm your choices. First: See why it s so important that you re starting now. ] 1

4 Get started today. Starting early can have an impact on your account. Your decision to start today could give you quite a bit more at retirement than starting five years from now. Hypothetical example: Potential growth if you contribute $100 of your paycheck monthly Potential account value in 10 years Potential account value in 20 years Start today $17,409* $52,397* Wait 5 years to start $7,201 $31,881 $10,208 difference $20,516 difference * Increase your contributions to $200 a month, and your potential account value could be even more - $34,819 in 10 years and $104,793 in 20 years. This hypothetical illustration is based on the following assumptions: (1) Hypothetical participant remains employed and contributes as shown at the beginning of each month throughout the periods shown, (2) a hypothetical effective annual rate of return of 7%, (3) reinvestment of all earnings, (4) no withdrawals or loans throughout the indicated periods, and (5) participant is 100% vested. Income taxes, inflation, fees and expenses are not taken into account. If they were, values would be lower. Earnings and pre-tax contributions in a tax-deferred plan are subject to income taxes when withdrawn, and if distributions are taken before age 59½, may also be subject to a 10% penalty. Individual results will vary. Systematic investing does not ensure a profit and does not protect against loss in a declining market. This example is for illustrative purposes only and does not represent the performance of any investment. Contributions are subject to Plan and IRS limits and such limits are indexed and adjusted for cost of living increases. Plan limits may be less than IRS limits. For highly compensated employees, additional limits may apply. This hypothetical illustration is for educational purposes. Actual benefits are provided solely according to the terms of the Plan. A participant s actual account balance at any point in the future will be determined by the contributions that have been made, any plan or account activity, and any investment gains or losses that may occur. The illustrations of future balances should in no way be construed to imply any guarantee of future employment. 2

5 Step1 Decide how much to invest. More than any other factor, the amount you put away will help determine how much your savings may grow. Your Company will start you off contributing 6% of your pay to your plan to ensure that you get the most out of their matching contributions. You may want to contribute more than this read on to find out why. Here are some suggestions for setting your contribution amount: Get all of your employer match. Varian Medical Systems, Inc. will match your contributions up to 6% of your eligible earnings to your Plan. Do what you can afford you can change your contribution amount later if needed. Start at a number that feels comfortable to you. The important thing is to invest what you can afford and start right away. Invest more in your plan, pay less in taxes. Your pretax contributions come out of your pay before income taxes are taken out. You can actually lower your current taxes by investing in the Plan today. Take a look at the chart to see how it works. Take-home pretax pay calculations If your pay-period contribution is: Your take-home pay is estimated to be reduced by only: $100 $72 $200 $144 Estimated annual after-tax cost assumes a single taxpayer in the 28% federal tax bracket and no state taxes incurred. Your actual tax savings may be more or less than the estimate shown depending on your taxable federal and state income, exemptions, and filing status. Potential changes to federal and/or state tax rates may affect tax savings in future years. Step 1 For more information visit or call x Find out more The Fidelity Take Home Pay Calculator shows how affordable it can be to invest in your plan, thanks to pretax contributions. You ll find it in the Library section at 3

6 Step 2 Step2 Determine investments that are right for you. 4 What kind of investor are you? The answer to this question will determine which plan investments may be right for you. First, start by finding your approach. Are you a conservative investor? An aggressive investor? Somewhere in between? The answer is a function of three things. The first is the length of time you have to invest in this case, the number of years until you expect to retire. The second is your comfort with risk. The third is your financial situation. If your time horizon is long, your risk tolerance is high, and your financial situation stable, you may be an aggressive investor. On the other hand, if you ll need your money soon, are uncomfortable with risk, and your financial situation is somewhat uncertain, you may need a more conservative approach. Many investors may be somewhere in between, taking a growth or balanced approach. To determine your possible investment approach, consider these factors: The age you want to retire Your comfort level with the stock market s ups and downs Whether you prefer stability or the potential for bigger returns, which entails greater risk Your short- and long-term financial needs Here are the approaches two others have taken.* This is Larry. Age: 40 He has about 25 years until he retires. He can tolerate significant up-anddown movement in the market. He has a preference for growth and doesn t mind substantial movement in his portfolio s value. His financial situation is secure. Based on these factors, Larry considers himself a fairly aggressive investor. This is Nancy. Age: 45 She has about 20 years until she retires. She can tolerate some up-and-down movement in the market. She is looking for some opportunity for growth and can tolerate some up-anddown movement in her portfolio s value. Her financial situation is somewhat secure. Based on these factors, Nancy considers herself a fairly conservative investor. *Hypothetical, for illustrative purposes only. > >

7 Next, learn about the different kinds of investments. There are three basic investment types shortterm investments, bonds, and stocks. And they, like investors, fall along a range from conservative to aggressive. Short-term investments are the most conservative. Also known as cash investments, this investment type involves the least amount of risk, but also provides the lowest potential returns. Bonds are in the middle. Generally less risky than stocks, this investment type typically offers moderate returns and risk compared with stocks. Stocks are the most aggressive. Although past investment results do not guarantee future CONSERVATIVE results, this investment type has historically provided the highest long-term returns and the greatest risk. Stock investments include large (large-cap), medium-size (mid-cap), and small (small-cap) U.S. companies, as well as foreign companies. However, each of these types of stock investments has its own level of risk for example, small cap tends to be more risky than large cap. Then, select the right mix of investment types for your situation. Once you know how conservative or aggressive your approach is as an investor, and you understand the difference between investment types, you can figure out what mix of investment types matches your approach. This chart shows how four hypothetical investment mixes align with different approaches to investing, from relatively conservative to relatively aggressive. 14% domestic stocks 6% international/global 50% bonds 30% short-term investments 35% domestic stocks 15% international/global 40% bonds 10% short-term investments 49% domestic stocks 21% international/global 25% bonds 5% short-term investments AGGRESSIVE Conservative Mix Balanced Mix Growth Mix Aggressive Growth Mix 60% domestic stocks 25% international/global 15% bonds Step 2 For more information visit or call May be appropriate if you prefer steadier performance over time, with some opportunity for growth. May be appropriate if you want some opportunity for growth, and can tolerate some up-anddown movement in your portfolio s value. May be appropriate if you have a preference for growth, and can tolerate significant upand-down movement in your portfolio s value. May be appropriate if you have a strong preference for growth, and can tolerate wide, and sometimes sudden, up-and-down movement in your portfolio s value. The purpose of the sample investment mixes is to show how mixes may be created with different risk and return characteristics to help meet a participant s goal. You should choose your own investments based on your particular objectives and situation. Remember, you may change how your account is invested. Be sure to review your decisions periodically to make sure they are still consistent with your goals. You should also consider any investments you have outside the plan when making your investment choices. The investment options offered through the Plan were chosen by the Plan Sponsor. The sample mixes illustrate some of the many combinations that could be created and should not be considered investment advice. 5

8 Step 2 Finally, pick your investment options. Your Company offers investment options across the three investment types. For descriptions, turn to the Investment Options section of this guide. You can also go to to get up-to-date performance information, other investment specifics, and educational material. Nancy and Larry revisited: a look at their investment mixes.* This is Larry. Age: 40 As a fairly aggressive investor, Larry selected a growth mix of investments. 49% domestic stocks 21% international/ global 25% bonds 5% short-term investments Growth Mix This is Nancy. Age: 45 As a fairly conservative investor, Nancy chose a balanced mix of investments. 35% domestic stocks 15% international/ global 40% bonds 10% short-term investments Balanced ance Mix x For help enrolling: *Hypothetical, for illustrative purposes only. e-learning: Online Fidelity e-learning workshops can teach you the fundamentals of saving for retirement. You ll find it in the Library section at Or call the Fidelity 401(k) Center at

9 Step 2 For more information visit or call

10 Step 3 Step3 Review and confirm. The more involved you are with your plan and your account, the greater your possibilities. Reviewing and confirming your choices is a great place to start. Here s all you need to do: First, go online to login at or call the Fidelity 401(k) Center at , between 5:30 a.m. and 9:00 p.m. Pacific time, Monday through Friday (excluding New York Stock Exchange holidays). Next, set up your password. If you re already a Fidelity customer, you can use your existing user name and password. Finally, click on the link to Varian Medical Systems, Inc. Retirement; Plan to access your plan and make changes. Or, access your account information via a representative. See the following pages for important plan details, including FAQs, descriptions of your investment options, as well as forms. x Remember, we re here to help. If you need any help along the way, visit Fidelity NetBenefits at or call the Fidelity 401(k) Center at

11 Frequently asked questions about your plan. Here are answers to questions you may have about the key features, benefits, and rules of your plan. When can I enroll in the Plan? There is no waiting period. You are eligible to enroll in the Plan at any time once Fidelity receives and loads your data from the Company. If you have not enrolled in the Plan within 60 days from your date of hire, you will be automatically enrolled in the Plan at a pretax contribution rate of 6% of your eligible earnings. Your contributions will be invested in the applicable Vanguard Target Retirement Trust II, based on a projected retirement date, as indicated in the chart found later in the guide. However, we encourage you to take an active role in the Plan and to choose a contribution rate and investment options that are appropriate for you. If you do not wish to contribute to the Plan, you must change your contribution rate to 0% within 60 days from your date of hire, by logging on to Fidelity NetBenefits at or by calling the Fidelity 401(k) Center at You may change your contribution rate at any time. How do I enroll in the Plan? To enroll in the Plan before automatic enrollment takes effect, or to change your contribution percentage or investment selections at any time, log on to Fidelity NetBenefits at or call the Fidelity 401(k) Center at If you enroll but do not make an investment election, your contributions will be invested in the applicable Vanguard Target Retirement Trust II, based on a projected retirement date. If no date of birth or an invalid date of birth is on file at Fidelity, your contributions will be invested in the Vanguard Target Retirement Income Trust II. When is my enrollment effective? Your enrollment becomes effective once you elect a deferral percentage, which initiates deduction of your contributions from your pay. These salary deductions will generally begin with the next pay period after we receive your enrollment information, or as soon as administratively possible. If you elect to wait until automatic enrollment takes effect, salary deductions will begin as soon as administratively possible after the 60th day from your date of hire. How much can I contribute? Through automatic payroll deduction, you can contribute between 1% and 25% of your eligible pay on a pretax basis and/or Roth basis, up to the annual IRS dollar limits. After one year of service, you may also contribute up to 15% of your pay on an after tax basis. Does the Company contribute to my account? Upon enrollment, Varian matches 100% of each pre-tax, Roth, and/or after-tax dollar you contribute, up to the first 6% of eligible pay that you defer to the Plan. When am I vested? Vesting is a term used to describe the portion of your account balance that you are entitled to under the Plan. You are immediately 100% vested in your own contributions to the Plan. You will be 100% vested in the company match contribution after one year of service. Employees hired prior to July 1, 2017, are FAQs For more information visit or call

12 FAQs immediately 100% vested in the company match contributions. What happens to my non-vested company match contributions if I am rehired? If your original hire date was on or after July 1, 2017 and you did not complete one year of service prior to your termination: You were not vested in any company matching contributions under the Plan. If you are rehired within 5 years from your termination date and did not take a distribution, the non-vested amount of your company matching contributions will be restored once you are credited with one year of service. If you took a distribution of your before-tax or Roth contributions following your original termination date, you must repay the amount that was distributed to you in order to have the non-vested company match contributions restored (repayment of your salary deferral amount that was distributed from the Plan must be repaid within 5 years of your original termination date). What are my investment options? To help you meet your investment goals, the Plan offers you a range of options. You can select a mix of investment options that best suits your goals, time horizon, and risk tolerance. The many investment options available through the Plan include conservative, moderately conservative, and aggressive funds. A complete description of the Plan s investment options and their performance, as well as planning tools to help you choose an appropriate mix, are available online at Fidelity NetBenefits. What are the single fund solution options in my plan? If the idea of getting professional help to manage your investments appeals to you, your plan offers Target Date Funds. With Target Date Funds, the investment mix of stocks and bonds automatically becomes more conservative as the target retirement date approaches. Principal invested is not guaranteed at any time, including at or after the fund s target date. Choose the fund that represents your anticipated year of retirement. Fidelity Portfolio Advisory Service at Work The Plan has teamed up with Fidelity to offer a valuable managed account service that lets you delegate the day-to-day management of your workplace savings plan account to professional investment managers. Fidelity s experienced professionals evaluate the investment options available in your plan and identify a model portfolio of investments appropriate for an investor like you. The service then invests your account to align with this model portfolio and provides ongoing management of your account to address changes in the markets, your plan s investment lineup, and changes in your personal or financial situation. With a managed account, you can take advantage of Fidelity s resources and experience to help ensure that: Your investments are managed through the ups and downs of the market. You re keeping your accounts aligned with your goals through annual reviews and check-ins. Your account is actively managed to create an opportunity for long-term gains while managing the risk associated with investing. To see if Fidelity Portfolio Advisory Service at Work is right for you, log on to NetBenefits at where you can easily enroll in the Service and learn more. Fidelity Representatives are available to answer any questions you may have about this managed account service. Call for more information. 10

13 Fidelity Portfolio Advisory Service at Work is a service of Strategic Advisers, Inc., a registered investment adviser and a Fidelity Investments company. This service provides discretionary money management for a fee. What catch-up contribution can I make? If you have reached age 50 or will reach 50 during the calendar year January 1 December 31 and are making the maximum Plan or IRS pretax contribution, you may make an additional catch-up contribution each pay period. The maximum annual catch-up contribution is $6,000. Going forward, catch-up contribution limits are subject to cost-of-living adjustments (COLAs) in $500 increments. If, at the end of the calendar year, your pretax contributions do not exceed the Plan contribution limit or the IRS annual dollar limit, some or all of your catch-up contributions will be recharacterized as regular pretax contributions. Can I take a loan from my account? Although your plan account is intended for the future, you may borrow from your account for any reason. Generally, the Plan allows you to borrow up to 50% of your vested account balance. The minimum loan amount is $1,000, and a loan must not exceed $50,000. You then pay the money back into your account, plus interest, through after-tax payroll deductions. Any outstanding loan balances over the previous 12 months may reduce the amount you have available to borrow. You may have one loan outstanding at a time. The cost to initiate a loan is $35.00, and there is an annual maintenance fee of $ The initiation and maintenance fees will be deducted directly from your Plan account. If you fail to repay your loan (based on the original terms of the loan), it will be considered in default and treated as a distribution, making it subject to income tax and possibly to a 10% early withdrawal penalty. Defaulted loans may also impact your eligibility to request additional loans. Be sure you understand the Plan guidelines and impact of taking a loan before you initiate a loan from your Plan account. Can I make withdrawals from my account? Withdrawals from the Plan are generally permitted when you reach age 59½, terminate your employment, retire, or if you become permanently disabled or have severe financial hardship as defined by your Plan. Keep in mind that withdrawals are subject to income taxes and possibly to early withdrawal penalties. When you leave the Company, you can withdraw your account balance or, if it is greater than $1,000, you can leave it in the Plan. The taxable portion of your withdrawal that is eligible for rollover into an individual retirement account (IRA) or another employer s retirement plan is subject to 20% mandatory federal income tax withholding, unless it is rolled directly over to an IRA or another employer plan. (You may owe more or less when you file your income taxes.) If you are under age 59½, the taxable portion of your withdrawal is also subject to a 10% early withdrawal penalty, unless you qualify for an exception to this rule. Can I move money from another retirement plan into my account in the Varian Medical Systems, Inc. Retirement Plan? You are permitted to roll over eligible pretax contributions from a 401(a) plan (e.g., 401(k)), 403(b) plan, or governmental 457(b) retirement plan account, a Simplified Employee Pension plan (SEP-IRAs), or eligible pretax contributions from a conduit individual retirement account (IRA). A conduit IRA is one that contains only money rolled over from an employer sponsored retirement plan that has not been mixed with regular IRA contributions. Call the Fidelity 401(k) Center at or FAQs For more information visit or call

14 FAQs log on to Fidelity NetBenefits at for details. You should consult your tax advisor and carefully consider the impact of making a rollover contribution to your employer s plan because it could affect your eligibility for future special tax treatments. Be sure to consider all your available options and the applicable fees and features of each before moving your retirement assets. How do I access my account? You can access your account online through Fidelity NetBenefits at or call the Fidelity 401(k) Center at to speak with a representative or use the automated voice response system, virtually 24 hours, 7 days a week. Where can I find information about exchanges and other plan features? You can find information about managing your account and learn about loans, exchanges, and more online through Fidelity NetBenefits at In particular, you can access loan modeling tools that illustrate the potential impact of a loan on the long-term growth of your account. You will also find a withdrawal modeling tool, which shows the amount of federal income taxes and early withdrawal penalties you might pay, along with the amount of earnings you could potentially lose by taking a withdrawal. You can also obtain more information about loans, withdrawals, and other plan features, by calling the Fidelity 401(k) Center at to speak with a representative or use the automated voice response system, virtually 24 hours, 7 days a week. How do I designate my Plan beneficiary(ies)? Accurate beneficiary information is an important part of retirement planning and ensures that your Plan will be paid in accordance with your wishes in the event of your death. Designating your Plan beneficiary(ies) is easy. Simply log on to go to the Your Profile link, and click Beneficiaries. Follow the instructions from there. If you have any questions, or if you do not have access to the Internet and need a paper beneficiary designation form, you may contact the Fidelity 401(k) Center at weekdays (excluding New York Stock exchange holidays) from 5:30 a.m. Pacific time to 9:00 p.m. Pacific time. What are my rights with respect to mutual fund pass-through voting? As a Plan participant, you have the ability to exercise voting, tender, and other similar rights for mutual funds in which you are invested through the Plan. Materials related to the exercise of these rights will be sent to you at the time of any proxy meeting or tender offer, or with regard to similar rights relating to the particular mutual funds held in your account. How do I obtain additional investment option and account information? The Company has appointed Fidelity to provide additional information on the investment options available through the Plan. Also, a statement of your account may be reviewed online at Fidelity NetBenefits at or requested by phone at

15 Investment Options Here is a list of investment options for the Varian Medical Systems, Inc. Retirement Plan. For up-to-date performance information and other fund specifics, go to Lifecycle Funds Placement of investment options within each risk spectrum is only in relation to the investment options within that specific spectrum. Placement does not reflect risk relative to the investment options shown in the other risk spectrums. Investment options to the left have potentially more inflation risk and less investment risk Vanguard Target Retirement Income Trust II Vanguard Target Retirement 2015 Trust II Vanguard Target Retirement 2020 Trust II Lifecycle Funds Vanguard Target Retirement 2025 Trust II Vanguard Target Retirement 2030 Trust II Vanguard Target Retirement 2035 Trust II Investment options to the right have potentially less inflation risk and more investment risk Vanguard Target Retirement 2040 Trust II Vanguard Target Retirement 2045 Trust II Vanguard Target Retirement 2050 Trust II Vanguard Target Retirement 2055 Trust II Vanguard Target Retirement 2060 Trust II Target date investments are generally designed for investors expecting to retire around the year indicated in each investment s name. The investments are managed to gradually become more conservative over time. The investment risks of each target date investment change over time as its asset allocation changes. They are subject to the volatility of the financial markets, including equity and fixed income investments in the U.S. and abroad and may be subject to risks associated with investing in high yield, small cap and foreign securities. Principal invested is not guaranteed at any time, including at or after their target dates. The chart below lists the assigned fund the Varian Medical Systems, Inc. Retirement Plan believes will best fit your diversification needs should you not select an investment option. Your Birth Date* Fund Name Target Retirement Years Before 1948 Vanguard Target Retirement Income Trust II Retired before 2013 January 1, December 31, 1952 Vanguard Target Retirement 2015 Trust II Target Years January 1, December 31, 1957 Vanguard Target Retirement 2020 Trust II Target Years January 1, December 31, 1962 Vanguard Target Retirement 2025 Trust II Target Years January 1, December 31, 1967 Vanguard Target Retirement 2030 Trust II Target Years January 1, December 31, 1972 Vanguard Target Retirement 2035 Trust II Target Years January 1, December 31, 1977 Vanguard Target Retirement 2040 Trust II Target Years January 1, December 31, 1982 Vanguard Target Retirement 2045 Trust II Target Years January 1, December 31, 1987 Vanguard Target Retirement 2050 Trust II Target Years January 1, December 31, 1992 Vanguard Target Retirement 2055 Trust II Target Years January 1, 1993 and later* Vanguard Target Retirement 2060 Trust II Target Years 2058 and beyond Investment Options For more information visit or call *Dates selected by Plan Sponsor 13

16 Investment Options Core Investment Options Investment options to the left have potentially more inflation risk and less investment risk CONSERVATIVE Investment options to the right have potentially less inflation risk and more investment risk AGGRESSIVE SHORT-TERM INVESTMENT BOND STOCKS AND BONDS STOCKS Stable Value Bond Balanced/ Hybrid Domestic Equities International/ Global Managed Income Portfolio II Class 1 Diversified PIMCO Total Return Fund Institutional Class Vanguard Total Bond Market Index Fund Institutional Shares Fidelity Balanced Fund - Class K PIMCO All Asset Fund Institutional Class Large Blend Vanguard Institutional Index Fund Institutional Shares Mid Blend Vanguard Mid-Cap Index Fund Admiral Shares Large Growth Fidelity Growth Company Commingled Pool Small Growth Neuberger Berman Genesis Fund Class R6 Diversified Dodge & Cox International Stock Fund Fidelity Diversified International Fund - Class K Small Blend Vanguard Small-Cap Index Fund Institutional Shares This spectrum, with the exception of the Domestic Equity category, is based on Fidelity s analysis of the characteristics of the general investment categories of the investment options and not on the actual security holdings, which can change frequently. Investment options in the Domestic Equity category are based on the options Morningstar categories as of 07/31/2017. Morningstar categories are based on a fund s style as measured by its underlying portfolio holdings over the past three years and may change at any time. These style calculations do not represent the investment options objectives and do not predict the investment options future styles. Investment options are listed in alphabetical order within each investment category. Risk associated with the investment options can vary significantly within each particular investment category, and the relative risk of categories may change under certain economic conditions. For a more complete discussion of risk associated with the mutual fund options, please read the prospectuses before making your investment decision. The spectrum does not represent actual or implied performance. 14

17 Investment Options Before investing in any mutual fund, consider the investment objectives, risks, charges, and expenses. Contact Fidelity for a mutual fund prospectus or, if available, a summary prospectus containing this information. Read it carefully. Dodge & Cox International Stock Fund VRS Code: Fund Objective: The investment seeks long-term growth of principal and income. Fund Strategy: Under normal circumstances, the fund will invest at least 80% of its total assets in equity securities of non-u.s. companies, including common stocks, depositary receipts evidencing ownership of common stocks, preferred stocks, securities convertible into common stocks, and securities that carry the right to buy common stocks. The fund typically invests in medium-to-large well-established companies based on standards of the applicable market. Fund Risk: Foreign securities are subject to interest-rate, currency-exchange-rate, economic, and political risks, all of which may be magnified in emerging markets. Value and growth stocks can perform differently from other types of stocks. Growth stocks can be more volatile. Value stocks can continue to be undervalued by the market for long periods of time. Stock markets are volatile and can decline significantly in response to adverse issuer, political, regulatory, market, economic or other developments. Additional risk information for this product may be found in the prospectus or other product materials, if available. Someone who is seeking to complement a portfolio of domestic investments with international investments, which can behave differently. Someone who is willing to accept the higher degree of risk associated with investing overseas. This description is only intended to provide a brief overview of the mutual fund. Read the fund s prospectus for more detailed information about the fund. Fidelity Growth Company Commingled Pool VRS Code: Fund Objective: Seeks capital appreciation. Fund Strategy: Normally invests primarily in common stocks of domestic and foreign issuers with the potential for aboveaverage growth. Growth may be measured by factors such as earnings or revenue. Uses fundamental analysis of each issuer s financial condition and industry position and market and economic conditions to select investments. Fund Risk: The value of the fund s domestic and foreign investments will vary from day to day in response to many factors, such as adverse issuer, political, regulatory, market, or economic developments. Stock values fluctuate in response to the activities of individual companies, and general market and economic conditions. Foreign investments involve greater risks than those of U.S. investments, as well as exposure to currency fluctuations. Growth stocks can perform differently from the market as a whole and other types of stocks and can be more volatile than other types of stocks. You may have a gain or loss when you sell your units. Someone who is seeking the potential for long-term share-price appreciation. Someone who is willing to accept the generally greater price volatility associated with growth-oriented stocks. Investment Options For more information visit or call The Fidelity Growth Company Commingled Pool is a collective investment trust managed by Fidelity Management Trust Company (FMTC). It is not a mutual fund, nor is it insured by the FDIC. The Fidelity Growth Company Commingled Pool is maintained by FMTC under the Fidelity Group Trust for Employee Benefit Plans. This description is only intended to provide a brief overview of this investment option, which is available only to certain qualified plans and is not offered to the general public. This investment option is not a mutual fund. 15

18 Investment Options Fidelity Balanced Fund - Class K VRS Code: Fund Objective: Seeks income and capital growth consistent with reasonable risk. Fund Strategy: Investing approximately 60% of assets in stocks and other equity securities and the remainder in bonds and other debt securities, including lower-quality debt securities, when its outlook is neutral. Investing at least 25% of total assets in fixed-income senior securities (including debt securities and preferred stock.) Engaging in transactions that have a leveraging effect on the fund. Fund Risk: Stock markets, especially foreign markets, are volatile and can decline significantly in response to adverse issuer, political, regulatory, market, or economic developments. Fixed income investments entail interest rate risk (as interest rates rise bond prices usually fall), the risk of issuer default, issuer credit risk and inflation risk. Foreign securities are subject to interest rate, currency exchange rate, economic, and political risks. Lower-quality bonds can be more volatile and have greater risk of default than higher-quality bonds. Leverage can increase market exposure and magnify investment risk. Someone who is seeking to invest in a fund that invests in both stocks and bonds. Someone who is seeking the potential both for income and for long-term share-price appreciation and who is willing to accept the volatility of the bond and stock markets. This description is only intended to provide a brief overview of the mutual fund. Read the fund s prospectus for more detailed information about the fund. On May 9, 2008, an initial offering of the retirement (K) class took place. Returns and expenses prior to that date are those of the non-k, non-advisor class. Had K class expenses been reflected in the returns shown, total returns would have been higher. Fidelity Diversified International Fund - Class K VRS Code: Fund Objective: Seeks capital growth. Fund Strategy: Normally investing primarily in non-u.s. securities. Normally investing primarily in common stocks. Fund Risk: Stock markets, especially foreign markets, are volatile and can decline significantly in response to adverse issuer, political, regulatory, market, or economic developments. Foreign securities are subject to interest rate, currency exchange rate, economic, and political risks, all of which are magnified in emerging markets. Someone who is seeking to complement a portfolio of domestic investments with international investments, which can behave differently. Someone who is willing to accept the higher degree of risk associated with investing overseas. This description is only intended to provide a brief overview of the mutual fund. Read the fund s prospectus for more detailed information about the fund. On May 9, 2008, an initial offering of the retirement (K) class took place. Returns and expenses prior to that date are those of the non-k, non-advisor class. Had K class expenses been reflected in the returns shown, total returns would have been higher. 16

19 Managed Income Portfolio II Class 1 VRS Code: Fund Objective: The fund seeks to preserve your principal investment while earning a level of interest income that is consistent with principal preservation. The fund seeks to maintain a stable net asset value (NAV) of $1 per share, but it cannot guarantee that it will be able to do so. The yield of the fund will fluctuate. Fund Strategy: The fund invests in benefit-responsive investment contracts issued by insurance companies and other financial institutions ("Contracts"), fixed income securities, and money market funds. Under the terms of the Contracts, the assets of the fund are invested in fixed income securities (which may include, but are not limited to, U.S. Treasury and agency bonds, corporate bonds, mortgage-backed securities, commercial mortgage-backed securities, asset-backed securities, and collective investment vehicles and shares of investment companies that invest primarily in fixed income securities) and shares of money market funds. The fund may also invest in futures contracts, option contracts, and swap agreements. Fidelity Management Trust Company, as investment manager and trustee of the Fidelity Group Trust for Employee Benefit Plans, has claimed an exemption from registration under the Commodity Exchange Act and is not subject to registration or regulation under the Act. At the time of purchase, all Contracts and securities purchased for the fund must satisfy the credit quality standards specified in the Declaration of Separate Fund Fund Risk: The Contracts and securities purchased for the fund are backed solely by the financial resources of the issuers of such Contracts and securities. An investment in the fund is not insured or guaranteed by the manager(s), the plan sponsor, the trustee, the FDIC, or any other government agency. The Contracts purchased by the fund permit the fund to account for the fixed income securities at book value (principal plus interest accrued to date). Through the use of book value accounting, there is no immediate recognition of investment gains and losses on the fund s securities. Instead, gains and losses are recognized over time by periodically adjusting the interest rate credited to the fund under the Contracts. However, while the fund seeks to preserve your principal investment, it is possible to lose money by investing in this fund. The Contracts provide for the payment of certain withdrawals and exchanges at book value during the terms of the Contracts. In order to maintain the Contract issuers promise to pay such withdrawals and exchanges at book value, the Contracts subject the fund and its participants to certain restrictions. For example, withdrawals prompted by certain events (e.g., layoffs, early retirement windows, spin-offs, sale of a division, facility closings, plan terminations, partial plan terminations, changes in laws or regulations) may be paid at the market value of the fund s securities, which may be less than your book value balance. Certain investment options offered by your plan (e.g., money market funds, short term bond funds, certain asset allocation/ lifecycle funds and brokerage window) may be deemed by the Contract issuers to "compete" with this fund. The terms of the Contracts prohibit you from making a direct exchange from this fund to such competing funds. Instead, you must first exchange to a non-competing fund for 90 days. While these requirements may seem restrictive, they are imposed by the Contract issuers as a condition for the issuer s promise to pay certain withdrawals and exchanges at book value. Someone who seeks a slightly higher yield over the long term than is offered by money market funds, but who is willing to accept slightly more investment risk. Someone who is interested in balancing an aggressive portfolio with an investment that seeks to provide stability of price. The investment option is a stable value fund. It is managed by Fidelity Management Trust Company. This description is only intended to provide a brief overview of the fund. This fund is a commingled pool of the Fidelity Group Trust for Employee Benefit Plans. Only qualified, participant-directed, defined contribution plans may invest in the fund. This investment option is not a mutual fund. Management Fee includes the costs associated with managing the investments in the pool. The management fee does not include the wrap contract fees, which are paid to third party wrap providers and do not result in any additional compensation to Fidelity. The wrap contract fees are not separately stated but are included in the Expense Ratio and do reduce returns. Expense Ratio (Gross) includes management and wrap contract fees. For certain investments, it may also include distribution fees. Please note that the Gross and Net Expense Ratio are the same for this investment. Investment Options For more information visit or call Neuberger Berman Genesis Fund Class R6 VRS Code: Fund Objective: The investment seeks growth of capital. Fund Strategy: The fund invests mainly in common stocks of small-capitalization companies, which it defines as those with a total market value of no more than $2 billion at the time the fund first invests in them. It may continue to hold or add to a position in a stock after the company s market value has grown beyond $2 billion. The fund seeks to reduce risk by diversifying among many companies and industries. 17

20 Investment Options Fund Risk: The securities of smaller, less well-known companies can be more volatile than those of larger companies. Growth stocks can perform differently from the market as a whole and can be more volatile than other types of stocks. Stock markets are volatile and can decline significantly in response to adverse issuer, political, regulatory, market, economic or other developments. These risks may be magnified in foreign markets. Additional risk information for this product may be found in the prospectus or other product materials, if available. Someone who is seeking the potential for long-term share-price appreciation. Someone who is willing to accept the generally greater price volatility associated both with growth-oriented stocks and with smaller companies. This description is only intended to provide a brief overview of the mutual fund. Read the fund s prospectus for more detailed information about the fund. The analysis on these pages may be based, in part, on adjusted historical returns for periods prior to the class s actual inception of 03/15/2013. These calculated returns reflect the historical performance of the oldest share class of the fund, with an inception date of 09/27/1988, adjusted to reflect the fees and expenses of this share class (when this share class s fees and expenses are higher.) Please refer to a fund s prospectus for information regarding fees and expenses. These adjusted historical returns are not actual returns. Calculation methodologies utilized by Morningstar may differ from those applied by other entities, including the fund itself. PIMCO All Asset Fund Institutional Class VRS Code: Fund Objective: The investment seeks maximum real return, consistent with preservation of real capital and prudent investment management. Fund Strategy: The fund normally invests substantially all of its assets in Institutional Class or Class M shares of any funds of the Trust or PIMCO Equity Series, an affiliated open-end investment company, except other funds of funds, or shares of any actively-managed funds of the PIMCO ETF Trust, an affiliated investment company. The fund s investment in a particular Underlying PIMCO Fund normally will not exceed 50% of its total assets. It is non-diversified. Fund Risk: Stock markets are volatile and can decline significantly in response to adverse issuer, political, regulatory, market, economic or other developments. These risks may be magnified in foreign markets. In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Additional risk information for this product may be found in the prospectus or other product materials, if available. Someone who is seeking to invest in a fund that invests in both stocks and bonds. Someone who is seeking the potential both for income and for long-term share-price appreciation and who is willing to accept the volatility of the bond and stock markets. This description is only intended to provide a brief overview of the mutual fund. Read the fund s prospectus for more detailed information about the fund. PIMCO Total Return Fund Institutional Class VRS Code: Fund Objective: The investment seeks maximum total return, consistent with preservation of capital and prudent investment management. Fund Strategy: The fund invests at least 65% of its total assets in a diversified portfolio of Fixed Income Instruments of varying maturities, which may be represented by forwards or derivatives such as options, futures contracts, or swap agreements. It invests primarily in investment-grade debt securities, but may invest up to 20% of its total assets in high yield securities. It may invest up to 30% of its total assets in securities denominated in foreign currencies, and may invest beyond this limit in U.S. dollar-denominated securities of foreign issuers. 18

21 Fund Risk: In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible. Additional risk information for this product may be found in the prospectus or other product materials, if available. Someone who is seeking potential returns primarily in the form of interest dividends rather than through an increase in share price. Someone who is seeking to diversify an equity portfolio with a more conservative investment option. This description is only intended to provide a brief overview of the mutual fund. Read the fund s prospectus for more detailed information about the fund. Vanguard Institutional Index Fund Institutional Shares VRS Code: Fund Objective: The investment seeks to track the performance of a benchmark index that measures the investment return of large-capitalization stocks. Fund Strategy: The fund employs an indexing investment approach designed to track the performance of the Standard & Poor s 500 Index, a widely recognized benchmark of U.S. stock market performance that is dominated by the stocks of large U.S. companies. The advisor attempts to replicate the target index by investing all, or substantially all, of its assets in the stocks that make up the index, holding each stock in approximately the same proportion as its weighting in the index. Fund Risk: Value and growth stocks can perform differently from other types of stocks. Growth stocks can be more volatile. Value stocks can continue to be undervalued by the market for long periods of time. Stock markets are volatile and can decline significantly in response to adverse issuer, political, regulatory, market, economic or other developments. These risks may be magnified in foreign markets. Additional risk information for this product may be found in the prospectus or other product materials, if available. Someone who is seeking the potential for long-term share-price appreciation and, secondarily, dividend income. Someone who is seeking both growth- and value-style investments and who is willing to accept the volatility associated with investing in the stock market. This description is only intended to provide a brief overview of the mutual fund. Read the fund s prospectus for more detailed information about the fund. S&P 500 Index is a market capitalization-weighted index of 500 common stocks chosen for market size, liquidity, and industry group representation to represent U.S. equity performance. Vanguard Mid-Cap Index Fund Admiral Shares VRS Code: Fund Objective: The investment seeks to track the performance of a benchmark index that measures the investment return of mid-capitalization stocks. Fund Strategy: The fund employs an indexing investment approach designed to track the performance of the CRSP US Mid Cap Index, a broadly diversified index of stocks of mid-size U.S. companies. The advisor attempts to replicate the target index by investing all, or substantially all, of its assets in the stocks that make up the index, holding each stock in approximately the same proportion as its weighting in the index. Investment Options For more information visit or call