HSA Investment Account Program Terms and Conditions These HSA Investment Account Terms and Conditions (the Terms and Conditions ) are by and among you, UMB Bank, n.a., as HSA Program Provider (the HSA Program Provider ) for your HSA (the HSA Deposit Account ), Interactive Retirement Solutions, LTD as HSA Recordkeeper (the HSA Recordkeeper ), Charles Schwab Bank (the Bank ), and Charles Schwab & Co., Inc., member FINRA and SIPC (the Broker-Dealer ). These Terms and Conditions describe the rights and obligations of you, the HSA Program Provider, the HSA Recordkeeper, Bank, and Broker-Dealer and other third parties regarding the investment options (the HSA Investment Account Program ) offered through your HSA Deposit Account as described below. As used herein, you and your refer to the Account Holder as defined under your HSA agreement with the HSA Program Provider. The term HSA Program Administrator, as used herein, shall be deemed to refer to ConnectYourCare, LLC. The term Registered Investment Advisor, as used herein, shall be deemed to refer to Devenir Investment Advisors, LLC. Introduction. Once funds in your HSA Deposit Account exceed a threshold established by the HSA Program Provider (the Threshold Amount ), you may invest the portion of the funds from your HSA Deposit Account that is in excess of the Threshold Amount in certain mutual funds from a variety of mutual fund families available through the Broker-Dealer (the Mutual Funds or HSA Investments ). Any funds held in your HSA Deposit Account not directed by you to be invested in the HSA Investments in accordance with the HSA Investment Account Program described herein will remain in the HSA Deposit Account at the HSA Program Provider. Any funds held in your HSA Deposit Account that you have directed to be invested in HSA Investments pursuant to the HSA Investment Account Program shall constitute your HSA Investment Account (the HSA Investment Account ). This HSA Investment Account Program is designed by the HSA Program Administrator. The HSA Investment Account Program has been designed so that it may be accessed solely through your HSA Deposit Account. Further, based upon advice from the Registered Investment Advisor, the HSA Investment Account Program has certain Mutual Funds available to you as investment options among which you may allocate your HSA Investment Account balances. The available Mutual Funds may change from time to time per the guidelines described in the Investment Policy Statement established by the Registered Investment Advisor for this HSA Investment Account Program pursuant to a contract with the HSA Program Administrator. The Registered Investment Advisor shall be responsible for monitoring the HSA Investment Account Program s compliance with the Investment Policy Statement. HSA Program Provider is the custodian of your HSA Deposit Account and has no role with respect to the HSA Investments except as otherwise set forth herein. The HSA Recordkeeper provides recordkeeping services in connection with available HSA Investments and your HSA Investment Account. The HSA Program Provider and HSA Recordkeeper have entered into a Health Savings Account Program Master Custodial Agreement with the Bank (the Master Custodial Agreement )
pursuant to which HSA Investments will be held in an omnibus position in a sub-custody account at the Bank as established by the HSA Program Provider. All trades in Mutual Funds on behalf of your HSA Investment Account will be executed at your direction through the Bank, subject to the terms of the Master Custodial Agreement, these Terms and Conditions and the applicable mutual fund s prospectus. The Broker-Dealer will act as the registered broker-dealer of record for the HSA Investments. 1. Investment Accounts May Lose Value. Any amounts in excess of the Threshold Amount that you direct to be invested in HSA Investments are not bank deposit obligations of, nor guaranteed by, the Bank, the HSA Program Provider or any other bank, are not insured by the FDIC or by any other governmental agency, and are subject to investment risks, including the possible loss of the principal amount invested, and may fluctuate in value. 2. Investment Accounts Annual Services Fees. You understand and agree that the following annual investment account service fees, consisting of an annual base fee (the Annual Investment Account Service Fees ) will be charged in connection with your use of your HSA Investment Account, and you authorize this fee to be deducted annually from your HSA Investment Account. It is intended that this will be the only fee, if applicable, charged to your HSA Investment Account: The Annual Investment Account Services Fee is $24.00. Unless this fee is paid by your employer the $24 fee will be deducted from your investment account annually. The liquidation of mutual funds to obtain the account services fee will be done on a pro-rata basis. (For example, if your Investment Account consists of Fund A at $750.00 and Fund B at $250.00 for a total of $1,000.00, the HSA Recordkeeper will instruct Bank to redeem shares having a value of $18.00 from Fund A and $6.00 from Fund B) a. Payment of Annual Investment Account Service Fee. The Annual Investment Account Service Fee for your HSA Investment Account will be deducted on a pro rata basis each year on your anniversary of establishing your HSA Investment Account, from your HSA Investment Account, unless these fees are otherwise paid by your employer. b. Change in Annual Investment Account Service Fee. The Bank and the HSA Recordkeeper, reserve the right to amend their fee schedules from time to time. Changes in any of these fees may cause a change in the Annual Investment Account Service Fees. If the Annual Investment Account Service Fees change, a notice of the change in fees will be posted on the website through which you access your HSA Investment Account. By continuing to maintain a balance in your HSA Investment Account after an increase in the Annual Investment Account Service Fee, you will consent to the deduction or payment of the new Annual Investment Account Service Fee. c. If your HSA Investment Account Balance is less than the Annual Investment Account Service Fee, your HSA Investment Account Balance will be used to pay towards the annual service fee and your HSA Investment Account will remain dormant. No additional fees will accrue while dormant. If you should fund your dormant account at a later date, your HSA Investment Account Balance will be deducted on a pro rata basis for the remaining amount owed, and a new anniversary date will be established for you at that time.
3. Consent to Electronic Delivery. This Consent to Electronic Delivery applies to all agreements, documents, confirmations, statements and records related to your application and participation in this HSA Investment Account Program. By clicking on the I Agree button on the signature section of the Enrollment page, you accept and consent to these Terms and Conditions, including the electronic delivery of all of the above-described documents. If you do not consent to electronic delivery, you may not participate in any aspect of this HSA Investment Account Program. You may access documents and obtain electronic records with appropriate browser software that supports 128-bit encryption and a valid e-mail account supported by software to enable you to receive e-mail messages. Your browser must be set up to accept cookies, Java, and JavaScript. You will be deemed to have received all records provided or made available to you in connection with this HSA Investment Account Program if such records are either forwarded to an e-mail address that you have provided to us or are posted on a welcoming screen or other identified location on our web site. To open and print certain documents, you will need a version of Adobe Acrobat Reader installed on your computer. Prospectuses and annual reports are provided in Adobe Acrobat's Portable Document Format (PDF). To access a prospectus in PDF, you must install the Adobe Acrobat Reader on your computer, which may be obtained free of charge from Adobe's web site. The HSA Recordkeeper provides electronic prospectus delivery free of charge via the Investment Center tab on the member portal; however, your online service provider may apply charges for online access. A free paper copy of the prospectus is available to you by calling the respective Mutual Fund s Shareholder Services numbers during normal business hours. If HSA Recordkeeper changes these hardware and software specifications in such a way that it may create a material risk that you will not be able to access these materials, HSA Recordkeeper will inform you of its revised software and/or hardware requirements. If you choose to withdraw your consent to electronic delivery you will be unable to retain your HSA Investment Account and it will be closed. In order to withdraw your consent for electronic delivery you may do so via the Close My Investment Account link under the Investment Center tab of the member portal. Closing your HSA Investment Account will liquidate any HSA Investments in your HSA Investment Account and initiate a cash distribution to your HSA Deposit Account through the HSA Program Provider. If the distribution involves the sale of shares or units of a Mutual Fund that imposes a redemption fee, that fee will apply according to the terms of the fund's prospectus. 4. Fees for Distributions. Neither the HSA Program Provider nor the Bank charges a fee for distributions from your HSA Investment Account. Notwithstanding the foregoing, if a distribution involves the liquidation of shares of a Mutual Fund that imposes a redemption fee, that fee will apply according to the terms of the Mutual Fund's prospectus. 5. Fees for Rollovers. Please refer to the HSA Program Provider s Fee Schedule from time to time for a listing of transfer fees if you transfer your HSA account balance to another HSA provider. All rollovers or transfers out of your HSA Investment Account will require you to sell all HSA Investments
allocated to your HSA Investment Account in order to process a cash distribution to your HSA Deposit Account through the HSA Program Provider. If a rollover distribution involves the sale of shares or units of a Mutual Fund that imposes a redemption fee, that fee will apply according to the terms of the fund's prospectus. 6. Payments to Service Providers. There are certain fees and expenses associated with Mutual Funds available through the HSA Investment Account Program, including shareholder servicing fees and 12b-1 fees, which are described in each Mutual Fund s prospectus. Some Mutual Funds may impose exchange fees and/or redemption fees. All of the Mutual Funds chosen as part of this HSA Investment Account Program are No Load or Load Waived funds. Some of these fees charged by the Mutual Funds may be paid to the Bank as described in each Mutual Fund s prospectus. Some or all of the Mutual Funds available under the HSA Investment Account Program, or their affiliated advisors and distributors, may make payments to the Bank or its affiliates for administrative and recordkeeping services they provide in connection with the servicing and distribution of the Mutual Funds (the Program Fee Payments ). The HSA Recordkeeper will direct the Bank to retain an amount of the Program Fee Payments received to satisfy its fees and forward the remaining amounts of the Program Fee Payments to the HSA Recordkeeper for the recordkeeping services it provides in connection with the HSA Investment Account Program. The Program Fee Payments are intended to be the primary source of payment to be used by the HSA Recordkeeper to pay the Bank its fees under the Master Custodial Agreement. Attached as Exhibit A- SERVICE PROVIDER FEES are the Bank s fees for its services under the Master Custodial Agreement and the HSA Recordkeeper s fees. BECAUSE YOU HAVE AUTHORIZED THE HSA PROGRAM PROVIDER TO ESTABLISH THE MASTER CUSTODY AGREEMENT WITH THE BANK AND BECAUSE YOUR HSA INVESTMENT ACCOUNT ASSETS ARE HELD IN ACCORDANCE WITH THE TERMS OF SUCH AGREEMENT, YOU ARE BEING PROVIDED A COPY OF THE BANK S FEE SCHEDULE FOR YOUR REVIEW AND AGREEMENT. It is important to note that the HSA Recordkeeper will use the Program Fee Payments received from the Mutual Funds to pay the Bank its fees under the Master Custodial Agreement. It is the intention of the parties hereto that the Bank s fees will be paid solely from the Program Fee Payments received from the Mutual Funds except as otherwise set forth in the Master Custody Agreement as described below. Further, the HSA Recordkeeper will retain any Program Fee Payments in excess the Bank s fees as additional compensation for its recordkeeping services. You understand and agree to the terms in these Fee Schedules. You also understand and agree that: (i) The Bank may receive remuneration in the form of Program Fee Payments from the Mutual Funds. Such remuneration is calculated based on the aggregate net asset value of the Mutual Fund shares held under the Master Custodial Account. (ii) The Bank may receive any credit, interest or other earnings (collectively the "Float") on aggregate cash balances that the Bank has on deposit with any third party bank or other financial institution with respect to cash in any HSA Investment Account (a) awaiting investment or reinvestment or (b) pending distribution.
(iii) The Bank may receive the amount of any gains that may result from the correction of trade errors as a result of trades placed by the Bank on behalf of any HSA Investment Account under the Master Custodial Account. (iv) If the Program Fee Payments received by the Bank are not sufficient to pay the Bank its fees under the Master Custodial Account, the HSA Recordkeeper shall pay the Bank its fees in accordance with Exhibit A. Notwithstanding the foregoing, you acknowledge and agree that the Bank may debit the Master Custodial Account quarterly to pay its fees set forth in Exhibit A. Further, you agree that the Bank will have a lien on the Master Custodial Account for its compensation and for any reasonable expenses, including, without limitation, reasonable counsel or appraisal fees, which may be withdrawn from the Master Custodial Account to the extent permitted by law. 7. Distributions from the HSA Investment Accounts: Authorization for Pro-Rata Withdrawals. If you have a balance in your HSA Investment Account, you acknowledge that any withdrawal or distribution will necessitate the redemption of Mutual Fund shares held in your HSA Investment Account and the transfer of the cash proceeds back to your HSA Deposit Account. Unless you direct the HSA Recordkeeper to provide instructions to redeem shares in a specific Fund or Funds, the redemption and distribution will be taken pro-rata from your HSA Investment Account. For example, and ignoring any un-invested cash in your HSA Investment Account, if the amount of your requested distribution is $600, and your HSA Investment Account consists of Funds A, B and C, each with a balance of $1000, HSA Recordkeeper would instruct the Bank to redeem shares having a value of $200 from each of Funds A, B, and C. 8. Confirmation of Transactions. For investments in your HSA Investment Account, you will receive a monthly electronic statement after the end of each calendar month confirming all transactions during the month. You can obtain immediate confirmation of any transaction in your HSA Investment Account by either using the Print Screen function following each transaction or checking your account s online Recent Transactions table. 9. Use of Investment Accounts. You confirm and agree by your establishment of your HSA Investment Account and your allocation of HSA Deposit Account balances to HSA Investments: a. That you authorize the HSA Program Provider to enter into a Master Custodial Agreement with the Bank in order to provide you and other HSA account holders with investment options under your HSA accounts. b. That all contributions to your HSA Investment Account will be cash transfers from your HSA Deposit Account. c. That you understand that assets which may be held under the Master Custodial Agreement are subject to the limitations that the Bank has established with respect to assets that it is willing to hold as custodian as set forth in Exhibit B to these Terms and Conditions. All such investments shall be held in an omnibus account in the name of the Bank or its nominee. You understand that some of the types of assets which the Bank
will accept (defined in Exhibit B below as the "Acceptable Assets") to hold in its capacity as custodian may not be available through the HSA Investment Account Program. d. That the HSA Recordkeeper and the HSA Program Provider, as applicable and pursuant to agreements among themselves, are responsible for meeting the requirements to report information to you and your beneficiaries. The HSA Recordkeeper will provide to you proxy and prospectus information on any HSA Investments you hold in your HSA Investment Account. You consent to the voting of all proxies by the Registered Investment Advisor. e. That the HSA Program Provider delegates to you, and you accept responsibility for, trading authority over all HSA Investments (including all Mutual Funds held in your HSA Investment Account); therefore, you must direct all purchase and sale transactions in connection with the investment of your HSA assets allocated to your HSA Investment Account by giving your investment directions to the HSA Recordkeeper through a website that will be made available to you. The HSA Recordkeeper will directly communicate all such directions to the Bank. You hereby direct the Bank to follow all such directions received from the HSA Recordkeeper. f. That the HSA Recordkeeper will have full responsibility for maintaining all records regarding your investment custodial account balances with the Bank. g. That your HSA is eligible to participate in the HSA Investment Account Program because it is a "Health Savings Account" as defined under Section 223(d)(1) of the Internal Revenue Code. h. That your HSA Investment Account assets may be aggregated in Bank s Master Custodial Account as established under the Master Custody Agreement for investment purposes with the assets of other HSA Investment Account holders. i. That you shall indemnify and hold harmless the Bank, its officers, employees, and agents from and against all liabilities, losses, expenses, and claims (including reasonable attorney's fees and costs of defense) arising out of (1) the acts or omissions to act with respect to the Master Custodial Account by persons unrelated to the Bank (the "unrelated persons") including, but not limited to, you, the HSA Program Provider, and the HSA Recordkeeper, (2) the Bank s action or inaction with respect to the Master Custodial Account resulting from reliance on the action or inaction of unrelated persons, including directions to invest or otherwise deal with the HSA Investments or cash pending investment in a Mutual Fund, or (3) any violation by any unrelated person of the provisions of applicable law, unless the Bank commits a breach of its duties by reason of its gross negligence or willful misconduct. Expenses incurred by the Bank, which it believes to be subject to indemnification under the Master Custodial Agreement may be charged against the Master Custodial Account if not paid by you at the Bank s request. Your obligations under this section will survive the termination of your HSA Investment Account. j. Generally, the Bank will rely on you to place an order to liquidate Mutual Fund shares in your HSA Investment Account if you want funds available in your HSA Deposit Account to cover medical expenses. If you do not make a trade or make it too late to have funds available in your HSA Deposit Account, the HSA Program Provider may decline to pay checks you have written or may deny debit card transactions to pay for your medical expenses, in the event distributions from your HSA (whether for payment of medical
expenses or applicable fees) exceed the collected balance in your HSA Deposit Account. The HSA Program Provider may deny payment of these transactions even though you have funds in your HSA Investment Account that could have been available to cover those debits. If there are insufficient funds in your HSA Investment Account to cover such debits, the HSA Program Provider reserves the right to order or direct the HSA Recordkeeper to order the liquidation of funds in your HSA Investment Account as it deems appropriate in its discretion to cover any shortfall. k. That by participating in the HSA Investment Account Program you are accepting these Terms and Conditions. You acknowledge that this is a self-directed investment program and that you have not been given any direct investment advice and that prospectus(es) have been made available to you electronically. 10. Investment Advice. You agree and acknowledge that when you use the HSA Investment Account, you, or you and your investment manager if you choose to use one, are solely responsible for determining the nature, potential value and suitability for you of any particular investment strategy, transaction (including futures transactions) or security (including equities and options). Indemnification. You agree to defend, indemnify and hold the HSA Program Provider, the HSA Recordkeeper, the Bank and the Broker-Dealer harmless from and against any and all claims, losses, liability costs and expenses (including but not limited to attorneys' fees) arising from your violation of these Terms and Conditions, state or federal securities laws or regulations, or any third party's rights, including but not limited to infringement of any copyright, violation of any propriety right and invasions of any privacy rights. This obligation will survive the termination of these Terms and Conditions. Amendments. The HSA Program Provider may amend these Terms and Conditions at any time by posting notice on the website through which you access your HSA Investment Account. You confirm your acceptance of the amendment by not closing and/or by continuing to use your HSA Investment Account. Governing Law. These Terms and Conditions shall be construed and interpreted in accordance with the laws of the state of Missouri, except to the extent federal law applies. Arbitration Any dispute arising under these Terms and Conditions will be resolved by submission of the issue to a member of the American Arbitration Association who is chosen by the parties involved. If the parties cannot agree on such a choice, each shall nominate a member of the American Arbitration Association, and the nominees will then select an arbitrator. Expenses of the arbitration will be paid as decided upon by the arbitrator.
EXHIBIT A: SERVICE PROVIDER FEES In the interest of full transparency, this Exhibit A discloses the fees related to this HSA Investment Program. These fees are absorbed and paid by the participating service providers of this program. These fees will not impact the Account Holders balance in neither the HSA Investment Account, nor the HSA Deposit Account. The HSA Program Provider hereby agrees and accepts on behalf of each HSA Account Holder that Charles Schwab Bank will deduct the Charles Schwab Bank quarterly fee invoice amount from the Shareholder Servicing Payments received by the Program Funds pursuant to Section 3(c) of the Additional Terms of this Fee Schedule. Charles Schwab Bank will forward any remaining Shareholder Servicing Payments to the Recordkeeper. The Recordkeeper will retain the forwarded Shareholder Servicing Payments as additional compensation. Charles Schwab Bank's Master Custodial Account Fees To Be Paid by Shareholder Servicing Payments Annual Service Fees: Annual Base Fee Annual Market Value Fees* Fees for Assets valued at: $ 500 per account $0 to $1 million 0.08% of market value $1 million to $10 million 0.05% of market value $10 million to $100 million 0.04% of market value Over $100 million 0.03% of market value The undersigned HSA Program Provider, on behalf of itself and each Account Holder as defined in that certain Health Savings Account Program Master Custodial Agreement (the Custody Agreement ) between the undersigned and Charles Schwab Bank (the Custodian ) hereby agrees and accepts that the Custodian may retain up to two basis points of the Shareholder Servicing Payments received from mutual fund companies. See exceptions below in the additional terms section of this schedule. A Shareholder Servicing Payment is indirect compensation which the Custodian and/or its affiliates, including Charles Schwab & Co., Inc., the registered broker-dealer (collectively, "Schwab") may receive from mutual fund companies or their affiliates and/or from bank sponsors of collective trust funds for the billing, collection, asset reconciliation and other administrative services (the Shareholder Services ) Schwab provides to Custodian s clients who are fund shareholders. Distribution and Disbursement Fees (includes production and mailing of IRS Tax Forms) Non periodic payments Security transfers away from Schwab Outgoing bank wire transfers Stop payments $5 per ACH transaction / $10 per check $50 per asset transfer, electronic $550 per asset transfer, physical certificate $20 per wire $20 per check / $10 per ACH or wire Additional Fees** Additional accounts Manual transactions $500 annually per account $20 each for publicly traded assets $30 each for all other assets $20 each for outgoing and incoming cash processing
Stale-dated check void fee Reprint of IRS tax form Correction of IRS tax form Termination fees (Based on period of time held at Schwab) Extraordinary services The lesser of $20 each or the value of the check $5 each $50 each <3 years $1,000 per account >3 years $ 300 per account $100 per hour ($100 minimum)
Definitions 1. Recordkeeper The HSA Recordkeeper identified in the Custody Agreement, 2. Schwab Charles Schwab Bank, Charles Schwab & Co. Inc., and their affiliates and subsidiaries. 3. Account The account established under the Custody Agreement 4. Other Fee Schedules The fee schedules collectively described above. 5. HSA Program Provider The HSA Program Provider described in the Custody Agreement. 6. Fund Company Any mutual fund company, bank, or other issuers of mutual funds, collective trust funds, and pooled funds, including those made available through Schwab. 7 Affiliated Funds Mutual funds and collective trust funds sponsored by Schwab, including The Charles Schwab Family of Funds ("SchwabFunds "), the Laudus Funds, and Charles Schwab Bank s collective trust funds. Fee Schedule Provisions 1. This fee schedule is intended for use for certain Accounts with assets held or accepted by the Custodian. 2. The fees for the Custodian s services described herein, with the exception of fees included in the Other Fee Schedules, are guaranteed by the Custodian for a period of one year commencing with the execution date of this fee schedule. Following the one-year period, the Custodian reserves the right to change fees for future services at any time by notifying the HSA Program Provider and the HSA Recordkeeper in writing 60 days prior to the effective date of the modification. 3. The fees described herein, with the exception of fees included in the Other Fee Schedules, are billed quarterly in arrears unless otherwise indicated. Past-due fees will be subject to a late fee of 2% of the past-due amount. In the event that any the Custodian s fees and expenses defined in this fee schedule are outstanding for more than sixty (60) days from the billing date, the Custodian is authorized and directed to deduct such fees and expenses from the Shareholder Servicing Payments collected from Fund Companies, their underwriters, issuers, managers, distributors or trustees, prior to forwarding the remaining portion of fees collected to the Recordkeeper or Plan, as applicable, as described herein. Notwithstanding the foregoing, the Custodian reserves the right to deduct directly from the Account any fees outstanding for more than thirty (30) days from the billing date. 4. Acceptance of this fee schedule or Other Fee Schedules by the HSA Program Provider will not be deemed in effect until the assets to be held in the Account have been reviewed and accepted by the Custodian. 5. The Custodian reserves the right (i) to decline acceptance of any assets not disclosed during the account acceptance process, and (ii) to refuse, in its sole discretion, to purchase or hold any particular asset deemed unacceptable. 6. *The Annual Market Value Fees cover: The transfer, set-up and custody of assets in one account per program. All assets covered under the terms of a the Custody Agreement regardless of whether they are held at the Custodian or by a Custodianauthorized sub-custodian, including Charles Schwab & Co., Inc. The processing of electronically transmitted transactions including but not limited to mutual fund transactions. Electronic receipts for contributions. Interest, dividend and capital gains posting; processing of capital changes (splits, reorganizations, etc.). Online access to account statements, reports and transaction functionality. Delivery of proxy and other asset-related mailings to the HSA Recordkeeper or its authorized party. A cash sweep feature if identified by the HSA Recordkeeper or its authorized party. 7. **Additional Fees: Pursuant to an agreement between Charles Schwab & Co., Inc. and the Custodian, the Custodian receives a percentage of the brokerage commissions and transaction fees charged, and mutual fund revenues received, by Charles Schwab & Co., Inc. with respect to brokerage and mutual fund transactions entered into on behalf of accounts for which the Custodian acts as trustee or custodian. Any waiver of account-level mutual fund sales charges/loads or investment minimums is based on the qualifications set forth in the applicable fund s prospectus and on the completion of any documentation required by the fund s issuer. Manual Transaction Fees apply to both settlement transactions for trades traded away from, but settling at, the Custodian and all transactions, whether trade- or cash-based, that are not placed by the HSA Program Provider or the HSA Recordkeeper through any Custodian-provided electronic data communications systems. In addition, manual transaction fees apply to the processing of distribution and contribution directives not sent via an automated file. The Stale-Dated Check Void Fee will apply to the voiding of all checks in the amount of $20 or less that remain uncashed for more than 180 days or that are voided at the direction of an authorized party; information with respect to such checks is reported to HSA Recordkeeper, or is made available to the HSA Program Provider or the HSA Recordkeeper for review on the Custodian s websites on a periodic basis. In the absence of any direction to the contrary from HSA Program Provider or the HSA Recordkeeper, the Custodian will automatically void such checks after 180 days. the Custodian will charge the Fee at the time the checks are voided, provided that the Custodian agrees to repay such amounts to the Account in the event that the recipient of a check subsequently presents the check for payment or is otherwise located and claims the amount of such distribution. Based on past experience, the amount of such remuneration received by the Custodian is expected to be negligible; however, this does not represent the impact of future experience. 8. The Custodian reserves the right to charge overdraft fees and will provide notice of such overdraft charges to the HSA Program Provider or the HSA Recordkeeper where applicable. Should the Custodian decide at its sole discretion to charge such an overdraft fee, such overdrafts will be tracked on a daily basis per Account and will be charged at an annualized interest rate of Fed Funds plus 100 basis points on the amount of each day s overdraft. Accumulated overdraft charges will be billed on a quarterly basis. Additional Terms 1. In addition to the expenses, specific fees and other remuneration that are set forth in this fee schedule or Other Fee Schedules, Schwab may receive remuneration from Fund Companies or their affiliates, underwriters, issuers, managers, distributors or trustees ( Program Fee Payments ) for the billing, collection, asset reconciliation and other administrative services (the "Shareholder Services") it provides to Schwab customers who are fund
shareholders, pursuant to a services or substantively similar agreement entered into between Schwab and the Program Fund. Such Program Fee Payments may include maintenance, networking and marketing fees in addition to Shareholder Services fees. 2. Schwab may also receive compensation for serving as investment advisor, administrator, underwriter, transfer agent, shareholder servicing agent, and/or broker of record with respect to the Affiliated Funds. 3. Schwab maintains a variety of pricing alternatives which generally are based on the level of Account assets held at Schwab for which the Recordkeeper provides services. Schwab typically retains a specific amount of the fees collected from Fund Companies on Account assets for the billing, collection, asset reconciliation and other Shareholder Services Schwab provides with respect to assets held in the Accounts, as follows: (a) Where Account assets are held at the Custodian, except as set forth below, the Custodian will generally retain up to two basis points of the services fees received by Schwab from a Program Fund, if eligible, with the following exceptions: Where the Custodian Account assets are invested in the Schwab Funds and Laudus Funds, the Custodian will pass through the entire Program Fee Payment received from the funds as a Shareholder Servicing Payment. (b) Where Account assets are held at Charles Schwab & Co. Inc., the Custodian will retain up to 100% of the Program Fee Payments, if eligible, for the Shareholder Services Schwab provides with respect to assets held in the Accounts. (c) The HSA Program Provider, as authorized by each HSA Account Holder, may authorize Schwab to retain up to 100% of the Program Fee Payments for the custody and other services that Schwab provides to the Account and which are described in this fee schedule. After the custody and other fees described herein are paid to Schwab, Schwab shall forward the applicable remaining portion of the Program Fee Payments collected from the Fund Companies to the Recordkeeper as described in this section, or if so directed, to the Account. Recordkeeper acknowledges and agrees that it will, upon request, provide the HSA Program Provider further information regarding specific amounts remitted by Schwab or to the Recordkeeper for Shareholder Services. (d) The exact amount of the fees may be more or less than the stated ranges included herein based upon the individual funds selected for inclusion in the program s investment options. The HSA Program Provider acknowledges and agrees that the amounts described in this Section are approved by it on behalf of the Account Holders described in the Custody Agreement and are payable to the Custodian and to the HSA Recordkeeper or Account, as applicable, and that HSA Recordkeeper has disclosed such amounts to each HSA Account Holder in order for such HSA Account Holder to take such fees into consideration in determining the reasonableness of the amounts payable to the Custodian and the HSA Recordkeeper or Account. The amounts forwarded to the HSA Recordkeeper are reported to the HSA Program Provider and the HSA Recordkeeper on the Shareholder Services Reports, which are made available to the HSA Program Provider and the HSA Recordkeeper via Schwab s schwabretirementcenter.com website or are mailed directly to the HSA Program Provider and the HSA Recordkeeper, as applicable. 4. The HSA Program Provider further acknowledges that the Custodian may receive, as compensation for its services, any credit, interest or other earnings (collectively "Float") on aggregate cash balances that the Custodian has on deposit with Charles Schwab Bank or any third-party bank or other financial institution. Such cash balances may result from cash contributions not yet invested, cash pending trade settlement, or cash pending distribution from the Account. See the Custody Agreement for more information regarding the applicable service standards for these processes. the Custodian has the authority to initiate investments on behalf of the Account only upon receipt of instructions from the HSA Recordkeeper or other authorized party. The Custodian calculates its cash Float investment amount each business day by netting all cash activity and adjusting for cash reserved for investment or reinvestment and for cash reserved for distributions. The result is further adjusted by an additional reserve amount determined by the Custodian in its sole discretion as necessary to satisfy the Account s cash needs the following day for settlement of trades and payments, which may be adjusted from time to time. The net cash Float amount is held subject to the earning of Float as non-interest bearing deposits by the Custodian, and such net cash Float amount is commingled with the general assets of Charles Schwab Bank. Charles Schwab Bank estimates the value of float on uninvested cash deposit balances to be equal to the federal funds rate (which is the rate at which depository institutions lend balances at the Federal Reserve to other depository institutions overnight) less the cost of FDIC insurance premiums Charles Schwab Bank is required to pay on such deposits. Exact rates earned for representative periods are available upon request. 5. The HSA Program Provider acknowledges and agrees that the amounts described in this fee schedule, including those described in this Additional Terms section, are payable to the Custodian, and that such amounts have been taken into consideration in determining the reasonableness of the amounts payable to the Custodian pursuant to this fee schedule. The HSA Program Provider acknowledges and agrees that it is responsible for accessing the Schwab Retirement Center website or contacting the Custodian for further information regarding any of the fees described herein.
EXHIBIT B: Charles Schwab Bank's Acceptable Asset Guidelines a. Instructions. You must direct the Bank through the HSA Recordkeeper regarding the purchase, sale and other acquisitions and dispositions. The Bank must be advised as soon as possible concerning any transactions that will need the Bank s consent, as described below, and reserves the right not to affect any transaction unless given sufficient time and information in which to evaluate it. All acquisitions or dispositions of assets must be made at fair market value and on an arms-length basis. Further, the terms and conditions must not be contrary to applicable law or regulations. b. Acceptable Assets. Assets are considered to be Acceptable Assets depending on the adequacy of the Bank s ability to support and administer the asset, Bank s powers and duties over the asset, the type of account, business risk, and other factors. Because the Bank does not exercise investment management powers over the Master Custodial Account, the Bank does not ordinarily make judgments about whether a particular investment decision in the HSA Investment Account Program's investment menu fits the investment objectives or is otherwise appropriate for the participating HSAs. Subject to the foregoing subjective criteria, and to other policies and procedures that may be issued, the following types of assets are ordinarily acceptable in the Bank accounts: i. Cash. ii. Mutual Funds available through the Bank. c. Specific Indemnity. Notwithstanding any general indemnity given elsewhere, the Bank reserves the right to seek specific indemnity from the appropriate parties where the Bank determines in its sole discretion that the acquisition or holding of a particular asset or class of asset involves unusual business risk.