HomeMy WebLinkAboutC-4933 - PSA for Consulting Services Related to the City of Newport Beach Deferred Compensation Plan1
PROFESSIONAL SERVICES AGREEMENT WITH
BENEFIT FUNDING SERVICES GROUP, LLC
FOR CONSULTING SERVICES RELATED TO THE
CITY OF NEWPORT BEACH DEFERRED COMPENSATION PLAN
THIS AGREEMENT is made and entered into as of this 1st day of October,
2007, by and between the CITY OF NEWPORT BEACH, a Municipal
Corporation ( "City "), and BENEFIT FUNDING SERVICES GROUP, LLC, a
Delaware Limited Liability Company whose address is 2040 MAIN STREET,
SUITE 150, IRVINE, CALIFORNIA 92614 ( "Consultant'), and is made with
reference to the following:
RECITALS
A. City is a municipal corporation duly organized and validly existing under
the laws of the State of California with the power to carry on its business
as it is now being conducted under the statutes of the State of California
and the Charter of City.
B. City has a need for consulting services related to its Deferred
Compensation Plan ('Plan ").
C. City desires to engage Consultant to provide consulting services related to
the Plan ( "Project').
D. Consultant possesses the skill, experience, ability, background,
certification and knowledge to provide the services described in this
Agreement.
E. The principal member[s] of Consultant for purposes of Project shall be
John C. Campbell.
F. City has solicited and received a proposal from Consultant, has reviewed
the previous experience and evaluated the expertise of Consultant, and
desires to retain Consultant to render professional services under the
terms and conditions set forth in this Agreement.
NOW, THEREFORE, it is mutually agreed by and between the undersigned
parties as follows:
1. TERM
The term of this Agreement shall commence on the above written date, and
shall terminate on the 1 st day of October, 2008, unless terminated earlier as
set forth herein.
2. SERVICES TO BE PERFORMED
Consultant shall diligently perform all the services described in the Scope
of Services attached hereto as Exhibit A and incorporated herein by
reference. The City may elect to delete certain tasks of the Scope of
Services at its sole discretion.
3. TIME OF PERFORMANCE
Time is of the essence in the performance of services under this
Agreement and the services shall be performed to completion in a diligent
and timely manner. The failure by Consultant to perform the services in a
diligent and timely manner may result in termination of this Agreement by
City.
Notwithstanding the foregoing, Consultant shall not be responsible for
delays due to causes beyond Consultant's reasonable control. However,
in the case of any such delay in the services to be provided for the Project,
each party hereby agrees to provide notice to the other party so that all
delays can be addressed.
3.1 Consultant shall submit all requests for extensions of time for
performance in writing to the Project Administrator not later than ten
(10) calendar days after the start of the condition that purportedly
causes a delay. The Project Administrator shall review all such
requests and may grant reasonable time extensions for
unforeseeable delays that are beyond Consultant's control.
3.2 For all time periods not specifically set forth herein, Consultant shall
respond in the most expedient and appropriate manner under the
circumstances, by either telephone, fax, hand - delivery or mail.
4. COMPENSATION TO CONSULTANT
City shall pay Consultant for the services on a quarterly basis in
accordance with the provisions of this Section. All of Consultant's work
performed in accordance with this Agreement, including all reimbursable
items and subconsultant fees, shall be performed for an annual fee of
Twenty -five thousand dollars ($25,000.00). No additional compensation
shall be provided during the term of this Agreement without the prior
written approval of City. In addition, Consultant shall not receive any
additional hard or soft - dollar compensation related to the Plan from any
other party including but not limited to any party who is a service provider
to the Plan or related to a service provider to the Plan.
4.1 Consultant shall submit quarterly invoices to City describing the
work performed the preceding quarter. City shall pay Consultant no
later than thirty (30) days after approval of the monthly invoice by
City staff.
4.2 City shall reimburse Consultant only for those costs or expenses
specifically approved in this Agreement, or specifically approved in
writing in advance by City. Unless otherwise approved, such costs
shall be limited and include nothing more than the following costs
incurred by Consultant:
A. The actual costs of subconsultants for performance of any of
the services that Consultant agrees to render pursuant to
this Agreement, which have been approved in advance by
City and awarded in accordance with this Agreement.
B. Approved reproduction charges.
C. Actual costs and /or other costs and /or payments specifically
authorized in advance in writing and incurred by Consultant
in the performance of this Agreement.
4.3 Consultant shall not receive any compensation for Extra Work
performed without the prior written authorization of City. As used
herein, "Extra Work" means any work that is determined by City to
be necessary for the proper completion of the Project, but which is
not included within the Scope of Services and which the parties did
not reasonably anticipate would be necessary at the execution of
this Agreement.
5. PROJECT MANAGER
Consultant shall designate a Project Manager, who shall coordinate all
phases of the Project. This Project Manager shall be available to City at all
reasonable times during the Agreement term. Consultant has designated
JOHN C. CAMPBELL to be its Project Manager. Consultant shall not
remove or reassign the Project Manager or any personnel listed in Exhibit A
or assign any new or replacement personnel to the Project without the prior
written consent of City. City's approval shall not be unreasonably withheld
with respect to the removal or assignment of non -key personnel.
Consultant, at the sole discretion of City, shall remove from the Project any
of its personnel assigned to the performance of services upon written
request of City. Consultant warrants that it will continuously furnish the
necessary personnel to complete the Project on a timely basis as
contemplated by this Agreement.
6. ADMINISTRATION
This Agreement will be administered by the Human Resources
Department. Barbara Ramsey shall be the Project Administrator and
shall have the authority to act for City under this Agreement. The Project
Administrator or his /her authorized representative shall represent City in
all matters pertaining to the services to be rendered pursuant to this
Agreement.
7. CITY'S RESPONSIBILITIES
In order to assist Consultant in the execution of its responsibilities under this
Agreement, City agrees to, where applicable: Provide access to, and upon
request of Consultant, one copy of all existing relevant information on file at
City. City will provide all such materials in a timely manner so as not to
cause delays in Consultant's work schedule.
8. STANDARD OF CARE
8.1 All of the services shall be performed by Consultant or under
Consultant's supervision. Consultant represents that it possesses
the professional and technical personnel required to perform the
services required by this Agreement, and that it will perform all
services in a manner commensurate with community professional
standards. All services shall be performed by qualified and
experienced personnel who are not employed by City, nor have any
contractual relationship with City. By delivery of completed work,
Consultant certifies that the work conforms to the requirements of
this Agreement and all applicable federal, state and local taws and
the professional standard of care.
8.2 Consultant represents and warrants to City that it has, shall obtain,
and shall keep in full force in effect during the term hereof, at its
sole cost and expense, all licenses, permits, qualifications,
insurance and approvals of whatsoever nature that is legally
required of Consultant to practice its profession. Consultant shall
maintain a City of Newport Beach business license during the term
of this Agreement.
8.3 Consultant shall not be responsible for delay, nor shall Consultant
be responsible for damages or be in default or deemed to be in
default by reason of strikes, lockouts, accidents, or acts of God, or
the failure of City to furnish timely information or to approve or
disapprove Consultant's work promptly, or delay or faulty
performance by City, contractors, or governmental agencies.
9. HOLD HARMLESS
To the fullest extent permitted by law, Consultant shall indemnify, defend
and hold harmless City, its City Council, boards and commissions,
officers, agents, volunteers, and employees (collectively, the "Indemnified
Parties ") from and against any and all claims (including, without limitation,
claims for bodily injury, death or damage to property), demands,
obligations, damages, actions, causes of action, suits, losses, judgments,
fines, penalties, liabilities, costs and expenses (including, without
limitation, attorney's fees, disbursements and court costs) of every kind
and nature whatsoever (individually, a Claim; collectively, "Claims "), which
may arise from or in any manner relate (directly or indirectly) to any
breach of the terms and conditions of this Agreement, any work performed
or services provided under this Agreement including, without limitation,
defects in workmanship or materials or Consultant's presence or activities
conducted on the Project (including the negligent and /or willful acts, errors
and /or omissions of Consultant, its principals, officers, agents, employees,
vendors, suppliers, consultants, subcontractors, anyone employed directly
or indirectly by any of them or for whose acts they may be liable or any or
all of them).
Notwithstanding the foregoing, nothing herein shall be construed to
require Consultant to indemnify the Indemnified Parties from any Claim
arising from the sole negligence or willful misconduct of the Indemnified
Parties. Nothing in this indemnity shall be construed as authorizing any
award of attorney's fees in any action on or to enforce the terms of this
Agreement. This indemnity shall apply to all claims and liability regardless
of whether any insurance policies are applicable. The policy limits do not
act as a limitation upon the amount of indemnification to be provided by
the Consultant.
10. INDEPENDENT CONTRACTOR
It is understood that City retains Consultant on an independent contractor
basis and Consultant is not an agent or employee of City. The manner and
means of conducting the work are under the control of Consultant, except to
the extent they are limited by statute, rule or regulation and the expressed
terms of this Agreement. Nothing in this Agreement shall be deemed to
constitute approval for Consultant or any of Consultant's employees or
agents, to be the agents or employees of City. Consultant shall have the
responsibility for and control over the means of performing the work,
provided that Consultant is in compliance with the terms of this Agreement.
Anything in this Agreement that may appear to give City the right to direct
Consultant as to the details of the performance or to exercise a measure of
control over Consultant shall mean only that Consultant shall follow the
desires of City with respect to the results of the services.
11. COOPERATION
Consultant agrees to work closely and cooperate fully with City's designated
Project Administrator and any other agencies that may have jurisdiction or
interest in the work to be performed. City agrees to cooperate with the
Consultant on the Project.
12. CITY POLICY
Consultant shall discuss and review all matters relating to policy and
Project direction with City's Project Administrator in advance of all critical
decision points in order to ensure the Project proceeds in a manner
consistent with City goals and policies.
13. PROGRESS
Consultant is responsible for keeping the Project Administrator and /or
his /her duly authorized designee informed on a regular basis regarding the
status and progress of the Project, activities performed and planned, and
any meetings that have been scheduled or are desired.
14. INSURANCE
Without limiting Consultant's indemnification of City, and prior to
commencement of work. Consultant shall obtain, provide and maintain at
its own expense during the term of this Agreement, a policy or policies of
liability insurance of the type and amounts described below and in a form
satisfactory to City.
A. Certificates of Insurance. Consultant shall provide certificates of
insurance with original endorsements to City as evidence of the
insurance coverage required herein. Insurance certificates must be
approved by City's Risk Manager prior to commencement of
performance or issuance of any permit. Current certification of
insurance shall be kept on file with City at all times during the term
of this Agreement.
B. Signature. A person authorized by the insurer to bind coverage on
its behalf shall sign certification of all required policies.
C. Acceptable Insurers. All insurance policies shall be issued by an
insurance company currently authorized by the Insurance
Commissioner to transact business of insurance in the State of
California, with an assigned policyholders' Rating of A (or higher)
and Financial Size Category Class VII (or larger) in accordance
with the latest edition of Best's Key Rating Guide, unless otherwise
approved by the City's Risk Manager.
D. Coverage Requirements.
Workers' Compensation Coverage. Consultant shall
maintain Workers' Compensation Insurance and Employer's
Liability Insurance for his or her employees in accordance
with the laws of the State of California. In addition,
Consultant shall require each subcontractor to similarly
maintain Workers' Compensation Insurance and Employer's
Liability Insurance in accordance with the laws of the State
of California for all of the subcontractor's employees. Any
notice of cancellation or non - renewal of all Workers'
Compensation policies must be received by City at least
thirty (30) calendar days (10 calendar days written notice of
non - payment of premium) prior to such change. The insurer
shall agree to waive all rights of subrogation against City, its
officers, agents, employees and volunteers for losses arising
from work performed by Consultant for City.
ii. General Liability Coverage. Consultant shall maintain
commercial general liability insurance in an amount not less
than one million dollars ($1,000,000) per occurrence for
bodily injury, personal injury, and property damage, including
without limitation, contractual liability. If commercial general
liability insurance or other form with a general aggregate limit
is used, either the general aggregate limit shall apply
separately to the work to be performed under this
Agreement, or the general aggregate limit shall be at least
twice the required occurrence limit.
iii. Automobile Liability Coverage. Consultant shall maintain
automobile insurance covering bodily injury and property
damage for all activities of the Consultant arising out of or in
connection with work to be performed under this Agreement,
including coverage for any owned, hired, non -owned or
rented vehicles, in an amount not less than one million
dollars ($1,000,000) combined single limit for each
occurrence.
iv. Professional Errors and Omissions Insurance. Consultant
shall maintain professional errors and omissions insurance,
which covers the services to be performed in connection with
this Agreement in the minimum amount of one million dollars
($1,000,000).
E. Endorsements. Each general liability and automobile liability
insurance policy shall be endorsed with the following specific
language:
i. The City, its elected or appointed officers, officials,
employees, agents and volunteers are to be covered as
additional insureds with respect to liability arising out of work
performed by or on behalf of the Consultant.
ii. This policy shall be considered primary insurance as
respects to City, its elected or appointed officers, officials,
employees, agents and volunteers as respects to all claims,
losses, or liability arising directly or indirectly from the
Consultant's operations or services provided to City. Any
insurance maintained by City, including any self- insured
retention City may have, shall be considered excess
insurance only and not contributory with the insurance
provided hereunder.
iii. This insurance shall act for each insured and additional
insured as though a separate policy had been written for
each, except with respect to the limits of liability of the
insuring company.
iv. The insurer waives all rights of subrogation against City, its
elected or appointed officers, officials, employees, agents
and volunteers.
V. Any failure to comply with reporting provisions of the policies
shall not affect coverage provided to City, its elected or
appointed officers, officials, employees, agents or
volunteers.
vi. The insurance provided by this policy shall not be
suspended, voided, canceled, or reduced in coverage or in
limits, by either party except after thirty (30) calendar days
(10 calendar days written notice of non - payment of premium)
written notice has been received by City.
F. Timely Notice of Claims. Consultant shall give City prompt and
timely notice of claim made or suit instituted arising out of or
resulting from Consultant's performance under this Agreement.
G. Additional Insurance. Consultant shall also procure and maintain,
at its own cost and expense, any additional kinds of insurance,
which in its own judgment may be necessary for its proper
protection and prosecution of the work.
15. PROHIBITION AGAINST ASSIGNMENTS AND TRANSFERS
Except as specifically authorized under this Agreement, the services to be
provided under this Agreement shall not be assigned, transferred
contracted or subcontracted out without the prior written approval of City.
Any of the following shall be construed as an assignment: The sale,
assignment, transfer or other disposition of any of the issued and
outstanding capital stock of Consultant, or of the interest of any general
partner or joint venturer or syndicate member or cotenant if Consultant is a
partnership or joint- venture or syndicate or cotenancy, which shall result in
changing the control of Consultant. Control means fifty percent (50 %) or
more of the voting power, or twenty -five percent (25 %) or more of the
assets of the corporation, partnership orjoint- venture.
16. SUBCONTRACTING
The parties recognize that a substantial inducement to City for entering
into this Agreement is the professional reputation, experience and
competence of Consultant. Assignments of any or all rights, duties or
obligations of the Consultant under this Agreement will be permitted only
with the express written consent of City. Consultant shall not subcontract
any portion of the work to be performed under this Agreement without the
prior written authorization of City.
17. OWNERSHIP OF DOCUMENTS
Each and every report, draft, map, record, plan, document and other
writing produced (hereinafter "Documents "), prepared or caused to be
prepared by Consultant, its officers, employees, agents and
subcontractors, in the course of implementing this Agreement, shall
become the exclusive property of City, and City shall have the sole right to
use such materials in its discretion without further compensation to
Consultant or any other party. Consultant shall, at Consultant's expense,
provide such Documents to City upon prior written request.
Documents, including drawings and specifications, prepared by
Consultant pursuant to this Agreement are not intended or represented to
be suitable for reuse by City or others on any other project. Any use of
completed Documents for other projects and any use of incomplete
Documents without specific written authorization from Consultant will be at
City's sole risk and without liability to Consultant. Further, any and all
liability arising out of changes made to Consultant's deliverables under
this Agreement by City or persons other than Consultant is waived against
Consultant and City assumes full responsibility for such changes unless
City has given Consultant prior notice and has received from Consultant
written consent for such changes.
18. CONFIDENTIALITY
All Documents, including drafts, preliminary drawings or plans, notes and
communications that result from the services in this Agreement, shall be
kept confidential unless City authorizes in writing the release of
information.
19. INTELLECTUAL PROPERTY INDEMNITY
The Consultant shall defend and indemnify City, its agents, officers,
representatives and employees against any and all liability, including costs,
for infringement of any United States' letters patent, trademark, or copyright
infringement, including costs, contained in Consultant's drawings and
specifications provided under this Agreement.
20. RECORDS
Consultant shall keep records and invoices in connection with the work to be
performed under this Agreement. Consultant shall maintain complete and
accurate records with respect to the costs incurred under this Agreement
and any services, expenditures and disbursements charged to City, for a
minimum period of three (3) years, or for any longer period required by law,
from the date of final payment to Consultant under this Agreement. All such
records and invoices shall be clearly identifiable. Consultant shall allow a
representative of City to examine, audit and make transcripts or copies of
such records and invoices during regular business hours. Consultant shall
allow inspection of all work, data, Documents, proceedings and activities
related to the Agreement for a period of three (3) years from the date of final
payment to Consultant under this Agreement.
21. WITHHOLDINGS
City may withhold payment to Consultant of any disputed sums until
satisfaction of the dispute with respect to such payment. Such withholding
shall not be deemed to constitute a failure to pay according to the terms of
this Agreement. Consultant shall not discontinue work as a result of such
withholding. Consultant shall have an immediate right to appeal to the
City Manager or his /her designee with respect to such disputed sums.
Consultant shall be entitled to receive interest on any withheld sums at the
rate of return that City earned on its investments during the time period,
from the date of withholding of any amounts found to have been
improperly withheld.
22. ERRORS AND OMISSIONS
In the event of errors or omissions that are due to the negligence or
professional inexperience of Consultant which result in expense to City
greater than what would have resulted if there were not errors or
omissions in the work accomplished by Consultant, the additional design,
construction and /or restoration expense shall be borne by Consultant.
Nothing in this paragraph is intended to limit City's rights under the law or
any other sections of this Agreement.
23. CITY'S RIGHT TO EMPLOY OTHER CONSULTANTS
City reserves the right to employ other Consultants in connection with the
Project.
24. CONFLICTS OF INTEREST
The Consultant or its employees may be subject to the provisions of the
California Political Reform Act of 1974 (the "Act "), which (1) requires such
persons to disclose any financial interest that may foreseeably be
materially affected by the work performed under this Agreement, and (2)
prohibits such persons from making, or participating in making, decisions
that will foreseeably financially affect such interest.
If subject to the Act, Consultant shall conform to all requirements of the
Act. Failure to do so constitutes a material breach and is grounds for
immediate termination of this Agreement by City. Consultant shall
indemnify and hold harmless City for any and all claims for damages
resulting from Consultant's violation of this Section.
All notices, demands, requests or approvals to be given under the terms of
this Agreement shall be given in writing, and conclusively shall be deemed
served when delivered personally, or on the third business day after the
deposit thereof in the United States mail, postage prepaid, first -class mail,
addressed as hereinafter provided. All notices, demands, requests or
approvals from Consultant to City shall be addressed to City at:
Attn: Barbara Ramsey
Human Resources Department
City of Newport Beach
3300 Newport Boulevard
Newport Beach, CA, 92663
Phone: 949 - 644 -3303
Fax: 949 - 644 -3305
All notices, demands, requests or approvals from CITY to Consultant shall
be addressed to Consultant at:
Attention: John C. Campbell
BFSG,LLC
2040 Main Street, Suite 150
Irvine, CA 92614
Phone: (949) 955-5781
Fax: (949) 955 -25552
26. TERMINATION
In the event that either party fails or refuses to perform any of the provisions
of this Agreement at the time and in the manner required, that party shall be
deemed in default in the performance of this Agreement. If such default is
not cured within a period of two (2) calendar days, or if more than two (2)
calendar days are reasonably required to cure the default and the defaulting
party fails to give adequate assurance of due performance within two (2)
calendar days after receipt of written notice of default, specifying the nature
of such default and the steps necessary to cure such default, and thereafter
diligently take steps to cure the default, the non - defaulting party may
terminate the Agreement forthwith by giving to the defaulting party written
notice thereof.
Notwithstanding the above provisions, City shall have the right, at its sole
discretion and without cause, of terminating this Agreement at any time by
giving seven (7) calendar days prior written notice to Consultant. In the
event of termination under this Section, City shall pay Consultant for
services satisfactorily performed and costs incurred up to the effective
date of termination for which Consultant has not been previously paid. On
the effective date of termination, Consultant shall deliver to City all reports,
Documents and other information developed or accumulated in the
performance of this Agreement, whether in draft or final form.
27. COMPLIANCE WITH ALL LAWS
Consultant shall at its own cost and expense comply with all statutes,
ordinances, regulations and requirements of all governmental entities,
including federal, state, county or municipal, whether now in force or
hereinafter enacted. In addition, all work prepared by Consultant shall
conform to applicable City, county, state and federal laws, rules,
regulations and permit requirements and be subject to approval of the
Project Administrator and City.
28. WAIVER
A waiver by either party of any breach, of any term, covenant or condition
contained herein shall not be deemed to be a waiver of any subsequent
breach of the same or any other term, covenant or condition contained
herein, whether of the same or a different character.
29. INTEGRATED CONTRACT
This Agreement represents the full and complete understanding of every
kind or nature whatsoever between the parties hereto, and all preliminary
negotiations and agreements of whatsoever kind or nature are merged
herein. No verbal agreement or implied covenant shall be held to vary the
provisions herein.
30. CONFLICTS OR INCONSISTENCIES
In the event there are any conflicts or inconsistencies between this
Agreement and the Scope of Services or any other attachments attached
hereto, the terms of this Agreement shall govern.
31. INTERPRETATION
The terms of this Agreement shall be construed in accordance with the
meaning of the language used and shall not be construed for or against
either party by reason of the authorship of the Agreement or any other rule
of construction which might otherwise apply.
32. AMENDMENTS
This Agreement may be modified or amended only by a written document
executed by both Consultant and City and approved as to form by the City
Attorney.
33. SEVERABILITY
If any term or portion of this Agreement is held to be invalid, illegal, or
otherwise unenforceable by a court of competent jurisdiction, the remaining
provisions of this Agreement shall continue in full force and effect.
34. CONTROLLING LAW AND VENUE
The laws of the State of California shall govern this Agreement and all
matters relating to it and any action brought relating to this Agreement shall
be adjudicated in a court of competent jurisdiction in the County of Orange.
35. EQUAL OPPORTUNITY EMPLOYMENT
Consultant represents that it is an equal opportunity employer and it shall not
discriminate against any subcontractor, employee or applicant for
employment because of race, religion, color, national origin, handicap,
ancestry, sex or age.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed on the day and year first written above.
APPROVED AS TO FORM:
. A ,,,C9-0-�
Assistant City Attorney
for the City of Newport Beach
ATTEST:
Byi/ /lL 6&PiR. f�7
LaVonne Harkless,
City Clerk
CITY OF NEWPORT BEACH,
A Municipal Corporation
By: am R 2
Barbara Ramsey,
Human Resources Director
for the City of Newport Beach
CONSULTANT:
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Print Name: Dhv) b-r-1t
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(Financial Officer)
Title:
Print Name:
Attachments: Exhibit A — Scope of Services
BFSG, LLC ( "Consultant "), will provide investment and compliance consulting services to the City of Newport Beach
"Client" with respect to the City of Newport Beach Deferred Compensation Plan (the "Plan') as outlined below:
INVESTMENT SERVICES
Provide comprehensive quarterly investment analysis review of all Plan investment options, as well as
additional options and asset classes to consider
Provide a market overview addressing the major markets, indices, sectors and the economic statistics that are
affecting them
Provide an in -depth portfolio summary, including fund and benchmark returns, style analysis and overall
portfolio return
Analyze the Plan asset allocation by fund and underlying sector. The fund lineup will also be analyzed to
determine the amount of overlap that may be occurring
Provide a detailed quantitative and qualitative examination of each mutual fund investment option within the
Plan, including performance numbers versus the category and index, manager style drift, risk /return,
standard deviation, Sharpe ratio, expense ratio, upside and downside capture and fund allocation (see
Attachment A - Investment Consulting Program Features)
Annually review Investment Policy Statement to ensure it is meeting the needs of the Client and the defined
contribution Plan participants
Continually monitor the Plan's investments to ensure they are meeting the Investment Policy Statement
parameters as well as the retirement needs of the participants
Make recommendations of possible alternatives to funds when, in conjunction with the Investment
Committee, it is determined a change in fund line -up is necessary
BFSG will be available four times per year, to meet with the Investment Committee, or other people
designated by the Client, to present the quarterly reports and findings, make recommendations as to
particular investments to be placed in the fund line -up and answer any questions that may arise
BFSG will act as co- fiduciary by providing investment advice on a regular basis to the Plan regarding the
Plan's assets in accordance with the provisions of this Agreement.
COMPLIANCE AND ADMINISTRATION CONSULTING SERVICES
Provide consulting assistance on fiduciary best - practices, including the maintenance of the Investment Policy
Statement and Fiduciary Education
Provide guidance on fidelity bond and fiduciary insurance policy coverage
Provide assistance with regulatory (DOL / IRS) audits as needed
Provide draft meeting minutes documenting Committee meeting discussions for the Client's use
Provide annual benchmarking of Plan costs as compared to industry average
Provide compliance- related and legislative updates as applicable
VENDOR BENCHMARKING (conducted every 3 - 5
Discovery, which entails gathering data regarding Client's current Plan, including specific needs as it relates to
a provider
Conduct a review of the universe of vendors in the marketplace to determine which would be appropriate
candidates for the Client's Plan
Prepare a customized Request for Information (RFI) based on Client's Plan specifics, demographics, and
needs. RFI to be sent to a minimum of 8 - 10 providers
Compile the responses and prepare a summarized presentation incorporating a review of the vendors'
recordkeeping / administration capabilities; investment offerings; education / communication abilities; and
costs. The presentation will be presented to Client's retirement plan committee so that the search maybe
narrowed to one or two finalists
Assist in coordinating in- person interviews with each of Client's chosen finalists so that Client may complete
selection
Prepare Management Letter to quantify and summarize process findings
Document entire evaluation process for client's fiduciary file
ADDITIONAL TERMS OF AGREEMENT
ERISA Fiduciary Status. BFSG hereby acknowledges and agrees that it will be a fiduciary of the Plan under ERISA and
that it will perform its duties under the Agreement (a) in accordance with the provisions of the documents and
instruments governing the Plan insofar as such documents and instruments are consistent with ERISA, (b) with the
care, skill, prudence and diligence required of a fiduciary of a plan subject to ERISA, and (c) for the exclusive purpose
of providing benefits to the Plan participants and beneficiaries and defraying reasonable expenses of administering the
Plan. Notwithstanding the foregoing, BFSG shall not be subject to ERISA fiduciary standards with respect to its
performance of consulting services for the Client in its settlor capacity.
Securities Law Fiduciary Status. BFSG hereby acknowledges and agrees that it is an investment adviser under the
Investment Advisers Act of 1940, and that as such, it has a fiduciary duty to provide disinterested advice and disclose
any material conflicts of interest to the Client.
Adviser Independence. Neither BFSG nor any of its employees has a "material relationship," financial or otherwise,
with any mutual fund or manager of any other investment vehicle that BFSG will recommend, consider for
recommendation, or otherwise mention to Client for consideration. For this purpose, "material relationship" is any
relationship that may affect the objectivity of the advice that BFSG provides under the terms of this Agreement.
ANALYSIS OF INVESTMENT ASSET CLASSES AND ON -GOING PERFORMANCE MONITORING:
BFSG shall evaluate all Plan investments against appropriate peer groups and index benchmarks using several measures to
quantify expenses, returns and risk - adjusted performance. Each Plan investment option will be initially reviewed, and then
reviewed quarterly. Both quantitative and qualitative criteria will be evaluated as follows:
Evaluation Methodoloev
Quantitative Criteria
1. Trailing 3, 5 and 10 year returns - Returns shall be weighted, based on the life of the fund. Recent returns will
be more heavily weighted, while older returns, which could have been produced under different conditions,
will be less heavily weighted.
2. Rolling 12 -month returns (10 years) - Returns shall be evaluated over a rolling 12 -month period to determine
how consistently the fund manager out - performed his peers in a variety of market cycles.
3. Rolling 36 month returns (10 years) - Returns shall also be evaluated over a 36 -month rolling period, thus
putting more emphasis on performance across different cycles of the market.
4. Sharpe Ratio (36 months) - Sharpe Ratio shall be evaluated to determine the funds overall efficiency. The
Sharpe Ratio is calculated by dividing the annualized return in excess of the risk free Treasury bill by the
standard deviation for that same time frame.
5. Information Ratio - The Information Ratio shall be evaluated by taking the excess return over the fund's
appropriate index and dividing it by the standard deviation.
6. Up Capture Ratio - The percentage of an index return captured during up market cycles, referred to as Up
Capture Ratio, shall be evaluated.
7. Down Capture Ratio - The percentage of an index return captured during down market cycles, referred to as
Down Capture Ratio, shall be evaluated.
S. Style Consistency to the appropriate category - The use of three, weighted analyses ensures that the funds that
are selected for the Plan continue to operate and perform as expected within their appropriate asset class. R-
Squared, style return consistency, and holdings consistency shall be evaluated.
9. Expense Ratio - The expense ratio shall be compared as a percentage to the appropriate category average.
Each fund shall be benchmarked to a specific market index, and fund performance will be evaluated and compared to
a relevant peer group using Morningstar category classifications. Each fund will be given a peer group ranking in each
criterion, shown as a percentage. The rankings for all criteria will then be averaged to give a fund its average ranking
score. (Each evaluation measure requires a three -year history to ensure an accurate evaluation of the fund; therefore,
any fund with less than a three -year history will not be evaluated using this method.)
BFSG will then use the overall ranking score to indicate whether a fund is outperforming, performing or under-
performing. An overall ranking score between 4.44% (the highest obtainable score) and 29.99% shall indicate a fund
that is outperforming. A score between 30 %- 59.99% shall indicate a fund that is performing. A score between 60% and
95.56% (the lowest obtainable score) shall indicate a fund that is under - performing.
Qualitative Criteria
In addition to the above criteria, additional factors will be monitored to determine a funds potential exposure to risk
that may make it unsuitable as a retirement plan investment option. The additional factors to be monitored are:
• Change in fund philosophy
• Change in fund manager
• Individual holding concentrations
• Economic sector concentrations
• Performance volatility as measured by standard deviation
• Attribution analysis
Portfolio turnover/ transaction costs
• Manager tenure
• Asset base
• Median market capitalization
• Average credit quality for bond funds
• Average duration for bond funds