HomeMy WebLinkAbout2022-205INVESTMENT ADVISORY SERVICES
AGREEMENT
This Investment Advisory Agreement
(`Agreement") is made and entered into as ofthe
date this Agreement is executed by the parties
("Execution Date'), by and between
Morningstar Investment Management LLC, a
Delaware limited liability company
("Morningstar'), and the plan sponsor ("Plan
Sponsor') the named fiduciary and sponsor of
the Plan identified on Exhibit (the `Plan').
BACKGROUND
The Plan Sponsor is a named fiduciary with
respect to the Plan with the authority under the
Plan to obtain certain investment advisory
services. Plan Sponsor has elected to offer the
Advisory Services to Plan participants. Plan
Sponsor has entered into a separate written
agreement with its financial service provider
("Service Provider") to provide daily valuation,
recordkeeping and other administrative services
to the Plan, including access to Morningstar's
investment Advisory Services, if Plan Sponsor so
elects.
The Plan Sponsor has determined that it is in the
best interests of the Plan and the Participants and
their Beneficiaries (both as defined in Exhibit A)
to retain Morningstar to provide the Advisory
Services (as defined below and further in Exhibit
A), including but not limited to providing
investment Advisory Services by and through
proprietary software and technology that
processes demographic an� financial information
about Participants and ide tifies model portfolios
comprised of various asset classes in weights that
correspond to various risk rofiles of individuals.
Use of the Ad ' rv. es, as directed by the
Participants and their Beneficiaries, shall be
effective after the execution of this Agreement
and upon the delivery of all necessary
information from Service Provider to
Morningstar (the "Effective Date").
Morningstar is willing to perform such
investment Advisory Services as a fiduciary to
the Plan as provided under the terms of this
Agreement.
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Based on the foregoing, Plan Sponsor, on behalf
of the Plan, and Morningstar agree as follows:
AGREEMENT
1. SERVICES AND PAYMENT
1.1 Description of Advisory Services.
Morningstar agrees to provide the Plan with the
Advisory Services. "Advisory Services" shall
mean individually or collectively the Managed
Account Services and the Investment Advice
Services (each as described below in Exhibit A)
and, provided, however, that the Plan and
Participants shall only be eligible to choose from
those Advisory Services specifically selected by
Plan Sponsor. The Advisory Services
specifically exclude analysis of or advice
regarding the potential local, state or federal tax
consequences resulting from any investment
advice or recommendation provided by
Morningstar.
1.2 Fees. In consideration for the Managed
Account Services, the Plan will pay to
Morningstar the fees set forth on Exhibit B.
1.3 Invoicing and Payment. Plan Sponsor
agrees to direct the Service Provider to collect all
applicable fees from each Participant's Plan
account and to remit such fees to Morningstar.
The parties agree and acknowledge that Service
Provider shall deduct monthly and remit the
applicable fees in monthly installments in arrears
beginning at the end of the month in which the
fees were earned by Morningstar.
2. TERM AND TERMINATION
2.1 Term. Subject to Section 2.2, the
Agreement shall commence on the Effective Date
and continue in effect for a term of one (1) year
from the Effective Date. The Agreement shall
automatically be renewed for additional one (1)
year periods, unless a party delivers to the other
parties a written notice of non -renewal at least
thirty (30) days prior to the date such renewal
would take effect (each one (1) year period is a
"Term").
2.2 Termination by Plan Sponsor or
Morningstar. Plan Sponsor or Morningstar may
terminate this Agreement upon thirty (30) days
prior written notice to the other parties for any
reason or no reason; provided however, that Plan
Sponsor shall continue to pay fees in accordance
with Exhibit B for Managed Account Services
rendered, prior to termination.
2.3 Effect of Termination. Upon expiration
or termination of this Agreement for any reason,
all rights granted to Plan Sponsor hereunder shall
terminate immediately and all Participants shall
no longer have access to the Advisory Services.
Expiration or termination of this Agreement for
any reason shall not affect the Plan's obligation
to pay any and all fees and other amounts due and
payable under this Agreement or relieve the Plan
or Plan Sponsor of any liability for breach of this
Agreement.
3. USE OF DATA AND
CONFIDENTIALITY
3.1 Plan Data. All information
communicated to Morningstar, whether before or
after the Effective Date, by the Plan, Plan
Sponsor, or the Service Provider, in connection
with this Agreement, that relates to the Plan, the
Plan's investments, or Plan Sponsor, Plan
Sponsor's employees, former employees,
Participants or Beneficiaries ("Plan Data"), will
be held by Morningstar in confidence and used
only for purposes of performing their Services
under this Agreement in accordance with this
Agreement or as disclosed in Morningstar's
privacy policy. Plan Data will remain the
property of the respective Plan or of the Plan
Sponsor, as the case may be. Morningstar will
maintain physical, electronic and procedural
safeguards to avoid disclosing Plan Data to third
parties, to at least the same degree as it employs
to avoid unauthorized disclosure or publication of
its own information or information of other
customers, and in no event less than industry -
standard safeguards.
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3.2 Exceptions. Notwithstanding Section
3. 1, Morningstar may disclose Plan Data to those
of their employees involved in providing the
Advisory Services, but only to the extent
reasonably necessary to perform the Advisory
Services under this Agreement or as disclosed in
Morningstar's privacy policy. Morningstar may
disclose Plan Data to the extent required to satisfy
any valid subpoena, court order, litigation or
regulatory request, or other legal requirement of
competent governmental authority, provided that
immediately following receipt of such request or
making a determination that disclosure is legally
required.
3.3 Ownership. Notwithstanding the rights
granted under this Agreement, Plan Sponsor
acknowledges and agrees that Morningstar or its
affiliates retain sole and exclusive ownership
over all data, analyses, opinions, software,
developments, inventions, processes, formulas,
technology, designs, drawings, engineering,
hardware configuration information or other
information provided by Morningstar
("Morningstar Intellectual Property").
Nothing contained herein transfers to Plan
Sponsor or the Plan any ownership interest in the
Morningstar Intellectual Property and any
software, pictures, images, materials, changes, or
other works of authorship provided contained in
the Morningstar Intellectual Property. Plan
Sponsor and the Plan have no right to make
derivative works of the Morningstar Intellectual
Property in any form for use in any medium
currently in existence or under development, now
or in the future.
3.4 Use and Promotion. Plan Sponsor
agrees that the Advisory Services shall be made
available only to retirement plans duly
established under the laws of the United States of
America and to Participants that are citizens
and/or legal residents of United States of America
or its territories.
The Advisory Services, or any portion thereof,
may be used by Plan Sponsor and its Participants
only for effecting retirement planning for
Participants that elect to receive the Advisory
Services. Any other use by the Plan Sponsor or
the Plan, including commercial use for the benefit
of another person, is prohibited under this
Agreement and shall be a material breach of this
Agreement. Plan Sponsor agrees to cooperate
and provide reasonable assistance to Morningstar
in connection with preventing and stopping any
unauthorized use, of the data, analyses, opinions
and other information contained in the Advisory
Services.
Annroval of Promotion. Plan Sponsor may not
mention or refer to Morningstar or the Advisory
Services in any correspondence, public
announcements, advertising, marketing or
promotional materials, or events (collectively, the
"Promotion Material") without Morningstar's
prior written approval. Plan Sponsor shall
incorporate appropriate notice, attribution and
disclaimer language into the Promotion Material,
as Morningstar may specify in its review of the
Promotion Material. Plan Sponsor shall have a
limited license to use the Morningstar name,
trademarks, service marks (the "Morningstar
Marks") identified herein but, in each instance,
only in the manner and format specified by
Morningstar in writing in advance. The
Morningstar Marks include:
Morningstar®
MfiI e
Any Promotion Material using the Morningstar
name or the Morningstar Marks shall include the
following disclosure, plus any additional
disclosures as indicated by Morningstar during its
review:
"The Morningstar name and trademarks are used,
under license, from Morningstar Investment
Management LLC. Morningstar Investment
Management LLC is a registered investment
adviser and subsidiary of Morningstar, Inc.
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Morningstar Investment Management LLC is not
affiliated with Plan Sponsor."
Morningstar has the authority to communicate to
Participants the features of the Advisory Services
electronically (online or via email) or through
direct mail, may utilize Plan Data for this purpose
and may require the Plan Sponsor to provide Plan
Data necessary to make these communications.
Confidentiality. The parties acknowledge that in
the course of their dealings hereunder, each may
acquire information about the other, its business
activities and operations, its technical
information and its trade secrets, all of which are
proprietary and confidential, but not including
Plan Data (the treatment of which is governed by
Sections 3.1-3.2 above) (the "Confidential
Information"). Each party hereby agrees that:
(a) all Confidential Information (including, but
not limited to the terms of this Agreement)
remains the exclusive property of the disclosing
party; (b) it shall maintain, and shall use prudent
methods to cause its employees and agents to
maintain (and not to otherwise copy, publish,
disclose or use other than as contemplated under
this Agreement), the confidentiality and secrecy
of the disclosing party's Confidential
Information; and (c) subject to any regulatory or
internal document retention policies, it shall
return or destroy all copies of the disclosing
party's Confidential Information upon request of
the disclosing party. Notwithstanding the
foregoing, Confidential Information shall not
include any information to the extent it: (i) is or
becomes a part of the public domain through no
act or omission on the part of the receiving party;
(ii) is disclosed to third parties by the disclosing
party without restriction on such third parties;
(iii) is in the receiving party's possession, without
actual or constructive knowledge of an obligation
of confidentiality with respect thereto, at or prior
to the time of disclosure under this Agreement;
(iv) is independently developed by the receiving
party without reference to the disclosing party's
Confidential Information; (v) is released from
confidential treatment by written consent of the
disclosing party; or (vi) is required to be disclosed
by a court of competent jurisdiction.
4. REPRESENTATIONS AND
WARRANTIES.
4.1 Representations of Morningstar.
Morningstar represents and warrants to Plan
Sponsor that it is an investment adviser registered
with the Securities and Exchange Commission
under the Investment Advisers Act of 1940, as
amended and, to Morningstar's knowledge (a) it
has all rights in and to all the Morningstar
Intellectual Property necessary to market,
distribute the Advisory Services in accordance
with the terms of this Agreement; (b) this
Agreement is binding on Morningstar; and (c)
Morningstar's entry into this Agreement does not
violate any prior obligation or agreement of
Morningstar.
Morningstar represents and warrants to Plan
Sponsor that the Managed Account Services will
(a) apply generally accepted investment theories;
(b) be diversified to minimize risk of large losses
due to asset class concentration; (c) be designed
to provide varying degrees of long-term
appreciation and capital preservation through a
mix of equity and fixed income based on
participant's age, retirement date or life
expectancy; and (d) change the asset allocation
and associated risk levels over time to become
more conservative with increasing age.
4.2. Representations of Plan Sponsor. Plan
Sponsor represents and warrants to Morningstar
that (a) Plan Sponsor has the authority and power
to enter into and comply with its obligations
under this Agreement and the rights and licenses
necessary to enter into and perform its obligations
under this Agreement; (b) this Agreement is
binding on Plan Sponsor and the Plan; (c) Plan
Sponsor's entry into this Agreement does not
violate any prior obligation or agreement of Plan
Sponsor or the Plan; (d) the individual signing
this Agreement and any Exhibits thereto on
behalf of Plan Sponsor is a named fiduciary of
Plan or is authorized to sign on behalf of the Plan
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Sponsor in its capacity as a named fiduciary of
Plan and is authorized to sign on behalf of the
Plan Sponsor in its corporate capacity; (e)
consistent with the terms and conditions
contained in all governing documents of Plan
Sponsor's Plan with respect to the voting of
proxies, Plan Sponsor, the Plan's trustee or such
other person designated by the Plan will vote
proxies for securities held in any investment
account for which Morningstar may provide
advice hereunder, and that Morningstar shall
have no responsibility or liability for proxy
voting, (f) Plan Sponsor has reviewed the fees and
expenses that will be paid to Morningstar,
described in Exhibit B, and have determined that
such fees and expenses are reasonable, and (g) the
instruments under which the Plan is maintained
authorize the Plan to pay any fees for which the
Plan is responsible as provided in this Agreement.
5. DISCLAIMERS:
5.1 Data Disclaimer. Morningstar will use
commercially reasonable efforts to ensure that the
data, analysis, opinion, and other information
contained in the Advisory Services are correct.
Although gathered from sources believed to be
reliable, Plan Sponsor acknowledges that
Morningstar cannot guarantee the accuracy of the
data or information used to provide the Advisory
Services. The completeness and timeliness of all
data and information used to provide the
Advisory Services is dependent upon the sources
of such data and information, which are outside
of Morningstar's control.
5.2 Disclaimer of Warranties. EXCEPT
AS EXPRESSLY SET FORTH HEREIN,
MORNINGSTAR PROVIDES NO
WARRANTIES, EITHER EXPRESS, IMPLIED
OR OTHERWISE WITH RESPECT TO THE
ADVISORY SERVICES DELIVERED
PURSUANT TO THIS AGREEMENT, OR THE
SOFTWARE COMPRISING THE ADVISORY
SERVICES, AND TO THE EXTENT
PERMITTED BY LAW, MORNINGSTAR
DISCLAIMS THE IMPLIED WARRANTIES
OF FITNESS FOR A PARTICULAR PURPOSE
AND MERCHANTABILITY WITH RESPECT
TO SUCH SERVICES. MORNINGSTAR
DOES NOT GUARANTEE THAT THE
ADVISORY SERVICES WILL BE
DELIVERED WITHOUT INTERRUPTION,
TIMELY, ERROR -FREE, OR SECURE.
ERRORS MAY OCCUR IN SOFTWARE -
BASED SERVICES AS A RESULT OF
PROGRAMMING ERRORS, DATABASE
ERRORS, OR OTHER CAUSES.
5.3 Acknowledgement of Limitations on
Recommendations. Plan Sponsor acknowledges
and agrees that in providing the Advisory
Services, Morningstar will only consider the
Designated Investment Alternatives (as defined
in Exhibit A) offered by the Plan, and that
Morningstar shall have no obligation to consider
or recommend investment options that are not
Designated Investment Alternatives of the Plan.
6. LIMITATION OF LIABILITY: The
following Limitations of Liability shall be
applicable:
6.1 Limitation of Damages. IN NO EVENT
SHALL EITHER PARTY BE LIABLE TO THE
OTHER PARTY OR ANY THIRD PARTY FOR
LOST PROFITS, CONSEQUENTIAL,
SPECIAL, INCIDENTAL OR PUNITIVE
DAMAGES, HOWSOEVER ARISING OUT OF
OR RELATING TO THIS AGREEMENT,
REGARDLESS OF THE BASIS OF THE
CLAIM. THE FEDERAL SECURITIES LAWS
IMPOSE LIABILITIES UNDER CERTAIN
CIRCUMSTANCES ON PERSONS WHO ACT
IN GOOD FAITH, AND THEREFORE
NOTHING HEREIN SHALL IN ANY WAY
CONSTITUTE A WAIVER OR LIMITATION
OF ANY RIGHTS WHICH THE
UNDERSIGNED MAY HAVE UNDER ANY
FEDERAL SECURITIES LAWS.
6.2 Plan Sponsor's Rights Under
Securities Laws. Nothing in this Agreement is
intended to or shall waive any rights to which
Plan Sponsor is specifically entitled under the
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securities laws of the United States or any state,
as applicable..
7. INDEMNIFICATION
7.1 Indemnification by Morningstar.
Morningstar agrees to indemnify, defend and
hold harmless the Plan Sponsor and its successors
and assigns, directors, officers and employees,
from and against any and all third party claims,
demands, suits, actions, and any and all damages,
losses, liabilities, taxes, penalties, fines, charges
costs and expenses, including reasonable
attorneys' fees, (individually a "Loss" and
collectively "Losses") arising from
Morningstar's breach of the fiduciary duty
imposed pursuant to this Agreement.
Morningstar's indemnification obligation shall
not apply to any Loss or Losses arising out of or
relating to a Loss due to any of the following: (i)
the financial performance of any investment
option included in the Plan; (ii) any violation of
applicable law, rules, or regulations, or the terms
of the Plan by a party other than Morningstar in
connection with such investment option; (iii) the
fault or negligence of, or violation of applicable
law, rules or regulations, or the terms of the Plan,
by Plan Sponsor or (iv) the delivery or
transmission by the Service Provider, the Plan
Sponsor or the Participant of incorrect,
inaccurate, or incomplete Plan Data. Plan
Sponsor shall provide prompt written notice of
any claim, action, or proceeding giving rise to
such obligation, shall reasonably cooperate with
its defense and/or settlement efforts and shall
grant Morningstar at Morningstar's option, sole
control of the defense and/or settlement of such
claim, action, or proceeding.
7.2 Indemnification by Plan Sponsor. Plan
Sponsor agrees to indemnify, defend and hold
harmless Morningstar, and its successors and
assigns, and its and their directors, officers and
employees, from and against any Loss or Losses
arising from Morningstar performance of
services to the Plan. Plan Sponsor's
indemnification obligation shall not apply to any
Loss or Losses arising out of or relating to a Loss
due to any of the following: (i) Morningstar's
fraud or willful misconduct; or (ii) any act or
omission for which Morningstar would be
required to indemnify the Plan Sponsor, pursuant
to Sections 7.1 above (as the case may be).
Morningstar shall provide prompt written notice
of any claim, action, or proceeding giving rise to
such obligation, shall ,reasonably cooperate with
its defense and/or settlement efforts and shall
grant Plan Sponsor at Plan Sponsor's option, sole
control of the defense and/or settlement of such
claim, action, or proceeding.
8. ENHANCEMENTS AND
MODIFICATIONS: Morningstar reserves the
right in their respective discretion to enhance,
modify, or provide upgrades (collectively
"Changes") of the Advisory Services from time
to time. Morningstar shall notify Service
Provider of any Changes, who shall notify Plan
Sponsor.
9. GENERAL
9.1 Form ADV. Morningstar is registered as
an investment adviser under applicable federal or
state law, or is otherwise exempt, and will
promptly advise Plan Sponsor if at any time it is
not so registered. Part 2A and 2B of
Morningstar's Form ADV, Morningstar's
registration document, contains additional
information regarding Morningstar and its
services. Plan Sponsor acknowledges that it has
received a copy of Morningstar's Form ADV Part
2A and 2B (and, in the future, during the any
Parts of the Form ADV that are required to be
acknowledged and received during the Term of
this Agreement).
9.2 Captions Not Determinative. Titles
and paragraph headings herein are for convenient
reference only and are not part of this Agreement.
9.3 No Partnership. Nothing in this
Agreement shall be construed to create a
partnership, joint venture or agency relationship
between the parties to this Agreement.
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9.4 Force Majeure. No party shall be in
default or otherwise liable for any delay in or
failure of its performance under this Agreement
where such delay or failure arises by reason of
any act of God, or any government or any
governmental body, acts of the common enemy,
the elements, strikes or labor disputes, or other
similar or dissimilar cause beyond the control of
such party. If a party is prevented from, or
delayed in, performing any of its obligations
under this Agreement, it will promptly notify the
other parties, describing in reasonable detail
circumstances causing the force majeure event,
and the obligations which are thereby delayed or
prevented, and will continue to use commercially
reasonable efforts to recommence performance as
soon as reasonably practicable.
9.5 Notice. All notices, including notices of
address changes, required to be sent hereunder
shall be in writing and shall be deemed to have
been given when delivered electronically or by
nationally recognized overnight courier or
registered or certified mail, postage prepaid to the
appropriate address below:
If to Morningstar:
Morningstar Investment Management LLC
22 W. Washington Street
Chicago, Illinois 60602
Attn: General Counsel
If to Plan Sponsor:
To the address and individual identified in
Exhibit A, or their successors.
9.6 No Third Party Beneficiaries. Nothing
contained in this Agreement is intended or will be
construed to confer upon any person not a party
to this Agreement (other than the Plan, a person
entitled to indemnification pursuant to the terms
of the Agreement, and Participants or
Beneficiaries, to the extent of rights expressly
extended to them under this Agreement) any
rights, benefits or remedies of any kind or
character whatsoever, and no such person will be
deemed a third -party beneficiary under or by
reason of this Agreement.
9.7 Severability. In the event that any
provision of this Agreement is held invalid by a
court with jurisdiction over the parties, such
provision shall be deemed to be restated to be
enforceable, in a manner which reflects, as nearly
as possible, the intent and economic effect of the
invalid provision in accordance with applicable
law. The remainder of this Agreement shall
remain in full force and effect.
9.8 Waiver. The waiver by any party of any
default or breach of this Agreement shall not
constitute a waiver of any other or subsequent
default or breach.
9.9 Modification. No representation or
promise hereafter made, nor any modification or
amendment of this Agreement shall be binding
unless in writing and both parties have consented
thereto, provided further, that such consent may
be granted through a negative consent process.
9.10 Counterparts. This Agreement and any
written modification hereof may be (a) executed
in one or more counterparts, each of which shall
be deemed an original, but which together shall
constitute one and the same document; and (b)
executed by facsimile signature by any party
hereto and such signature shall be deemed
binding for all purposes hereof, without delivery
of an original signature being thereafter required.
9.11 Assignment. None of the parties may
assign this Agreement or any of the rights or
obligations granted hereunder without the other
parties' prior written consent.
9.12 Governing Law and Jurisdiction. This
Agreement shall be governed by and construed in
accordance with the laws of the State of Illinois,
and the Investment Advisers Act of 1940 or any
rule, regulation or order promulgated thereunder,
without reference to its conflicts of law
principles.
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9.13 Survival. Termination or cancellation of
this Agreement for any reason shall not relieve
either party of obligations that accrued prior to
termination or cancellation, or of obligations that
by their nature are intended to survive this
Agreement, including but 'not limited to
obligations in connection with warranties,
confidential information and indemnification.
9.14 Authority. The person signing this
Agreement on behalf of each party has been
properly authorized and empowered to enter into
this Agreement.
9.15 Entire Agreement. This Agreement and
the Exhibit(s) constitute the complete agreement
between the parties and supersede all previous or
contemporaneous agreements, proposals,
understandings, and representations, written or
oral, with respect to the subject matter addressed
herein, other than the disclosures made in
Morningstar's Form ADV Part 2A and 2B.
Recitals included at the beginning of this
Agreement are hereby incorporated into this
Agreement by this reference thereto.
IN WITNESS WHEREOF, the parties have
entered into this Agreement, and intend to be
legally bound by it, as of the Execution Date.
PIE
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Title: County Administrator
Date: 1} l ?-i) L2 2—
Morningstar Investment Management LLC
By:
Name: Brock Johnson
Title:
Date:
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EXHIBIT A TO INVESTMENT ADVISORY SERVICES AGREEMENT
Description of Services and Responsibilities
Name of Plan: Indian River County BOCC Deferred Compensation Plan for Public Employees 457
Governmental Plan and Trust
Name of Plan Sponsor: Indian River County BOCC
Address of Plan Sponsor: 1800 271 St., Vero Beach, FL 32960
Contact Person(s): Jason Brown
Contact Person(s) Phone Number and Email Address:
I. DEFINITIONS The following definitions shall apply to this Agreement and to any Exhibit attached
hereto:
• Beneficiaries means any person or entity the Participant chooses to receive the benefits of the
retirement account after he or she dies.
• Designated Investment Alternatives means any investment alternative designated by the Plan
Sponsor into which Participants may direct the investments of assets held in, or contributed to, their
individual accounts. Designated Investment Alternatives shall exclude self-directed brokerage
accounts, mutual fund windows, or other similar investment vehicles.
• Investment Advice Services means making point -in -time recommendations regarding the
investment allocation of the assets in a Participant's Plan account. Investment Advice Services
shall be made available to the Participants through Morningstar® Retirement Managers"
specifically selected by Plan Sponsor pursuant to this Agreement and any Exhibits hereto.
• Plan Portfolios are portfolios comprised of Designated Investment Alternatives based on
predetermined equity targets, complying with Qualified Default Investment Alternative regulations
set forth under 29 C.F.R. § 2550.404c-5 ("QDIA").
• Managed Account Services means a discretionary investment advisory service offered to the Plan
and its Participants by Morningstar, as further described herein.
• Morningstar® Retirement Managers" means the proprietary web -based application that is
primarily focused on providing Advisory Services. Morningstar will provide Advisory Services
by and through Morningstar® Retirement Managers" in its standard design with current supported
plan types and functionality and any subsequent global modifications, enhancements, or upgrades.
• Participant means an individual who is enrolled or is eligible to enroll in the Plan and whose Plan
Sponsor elected to offer the Advisory Services.
• Reallocate means the process whereby Morningstar will send transactional instructions to Service
Provider for buying and selling Designated Investment Alternatives in order to assign a Plan
Portfolio to a Participant based on the ongoing consideration of Plan Data in the Managed Account
Service.
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II. ACCESS, TECHNICAL REQUIREMENTS AND SPECIFICATIONS
a. Method of Access: Morningstar shall provide Plan Sponsor's Participants with access to
Morningstar® Retirement Managers' via the Internet through an HTTPS connection, which
connection shall be established and maintained by Service Provider for Plan Sponsor's benefit.
Participants shall access Morningstar® Retirement Managers'" from the Service Provider's website,
which will provide a link to a web site designated and maintained by Morningstar.
b. Technical Requirements:
Browsers (Latest version of the following browsers plus one previous version):
x Microsoft® Edge
x Google Chrome
x Apple Safari
x Mozilla Firefox
x Morningstar reserves the right not to immediately support new browser versions.
X Morningstar reserves the right to change the above referenced technical requirements
as certain browser versions become obsolete or outdated or as new versions are
released.
System Requirements:
x Windows®
x Mac® OS
x JavaScript and Cookies must be enabled
x Adobe Acrobat Reader
Security:
X 128 -bit encryption
Pop -ups:
x In order to view certain pages in the Morningstar® Retirement ManagersM site, pop -ups
must be enabled.
III. STANDARD OF CARE
During the term of this Agreement, Morningstar will perform the Advisory Services under this
Agreement in good faith, solely in the interest of the participants and with the degree of
diligence, care and skill that a prudent person rendering similar services as an investment
adviser would exercise under similar circumstances. The provisions of this Agreement shall
not be interpreted to imply any other obligation on the part of Morningstar to observe any other
standard of care, provided, however, to the extent provision of the Advisory Services makes
Morningstar a fiduciary. Morningstar shall not be liable for the acts or omissions of any other
fiduciary to the Plan, including, but not limited to, any acts or omissions of the Plan Sponsor.
IV. MORNINGSTAR OBLIGATIONS
Morningstar shall:
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i) With respect to the Managed Account Services, act as fiduciary and investment
manager, to the Plan and its Participants;
ii) With respect to Investment Advice Services, act as fiduciary;
iii) Establish or confirm connectivity with Service Provider necessary to receive and
deliver Plan Data and implement Participant transactions in connection with the
Advisory Services;
iv) Collect and process Plan Data as is reasonably necessary to provide the Advisory
Services;
v) Collect and process data and information on the Designated Investment Alternatives;
vi) Construct and monitor the Plan Portfolios;
vii) Assign Participants to Plan Portfolios based upon Plan Data and instruct the Service
Provider to make necessary trades in accordance with the assigned Plan Portfolios;
viii) Reallocate Participants who enroll in the Managed Account Service on an ongoing
basis, but no less frequently than quarterly; and
ix) Communicate with Plan Sponsor with respect to any matters arising its duties or
obligations.
V. PLAN SPONSOR OBLIGATIONS AND ACKNOWLEDGEMENTS
i) Plan Sponsor, in its capacity as named fiduciary of the Plan, hereby appoints Morningstar
and as "investment manager" to the Plan, with respect to any Participant who has an account
within the Plan, and has elected to enroll in the Managed Account Services. Plan Sponsor
agrees and acknowledges that the powers of Morningstar to manage, acquire or dispose of
any Plan asset shall pertain only to its respective duties and obligations described herein.
ii) Plan Sponsor agrees to provide or cause Service Provider to provide accurate and timely
Plan Data and understands that Morningstar will rely on such Plan Data to provide the
Advisory Services. Morningstar shall not have any liability for Service Provider's or Plan
Sponsor's failure to timely inform Morningstar Service Provider, as applicable, of any
changes to the Plan Data. Therefore:
a. Plan Sponsor shall or shall cause Service Provider to provide all necessary
Participant census data and updates as requested by Morningstar or Service
Provider in order for Morningstar to provide the Advisory Services described
in this Agreement;
b. Plan Sponsor shall or shall cause Service Provider to provide Plan information
and rules to Morningstar or Service Provider that are necessary for set-up
services and promptly notify Morningstar or Service Provider with any updates
to this information if changes are made; and
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c. Plan Sponsor or its authorized designee shall select the Plan's Designated
Investment Alternatives, and promptly notify Service Provider of any changes
to Plan's Designated Investment Alternatives or transaction rules.
iii) All funds eligible for use within the Participant Portfolios are selected by Plan Sponsors at
their sole discretion. The initial list of Designated Investment Alternatives must be
provided (or have previously been provided) to Morningstar, either by the Service Provider
or Plan Sponsor, no later than twelve (12) weeks prior to the launch of the Advisory
Services ("Initial Delivery Date") so that Morningstar may analyze the Designated
Investment Alternatives. Plan Sponsor agrees and acknowledges that any funds not
included in the list of Designated Investment Alternatives shall not be included in the
Advisory Services.
If, after the Initial Delivery Date, Plan Sponsor intends to add funds to the list of
Designated Investment Alternatives, it shall cause Service Provider to give
Morningstar advance notice of such added funds, up to forty-five (45) days' notice if
administratively possible, which notice shall include the name of the fund, the fund
type (i.e. open-end fund or custom fund) and the fund identifier, such as the ticker
symbol, cusip, or external fund identification number, as may be applicable.
Plan Sponsor acknowledges that all funds within the list of Designated Investment
Alternatives must be covered in Morningstar Inc.'s database in order for such Plan's
Participants to receive the Advisory Services.
The Investment Advice Services do not monitor, review or update suggestions or
projections on an ongoing basis. Participants are solely responsible for reviewing and
updating their individual financial information and for tracking their account(s) and
the market to be aware of any changes in the value of their account.
Plan Sponsor can elect either the Managed Account Services or the Investment Advice
Services or can elect to have both the Managed Account Services and the Investment
Advice Services. The election will be indicated by checking the appropriate box(es)
below:
® Managed Accounts Services
❑ Investment Advice Services
VI. Treatment of Company Stock:
Morningstar shall have no duty to provide Advisory Services with respect to securities
issued by a Plan Sponsor ("Company Stock") that cannot be sold in the ordinary course
of business due to a Plan provision or instruction from the Plan Sponsor ("Restricted
Company Stock"). Restricted Company Stock shall not be included within a Plan
Portfolio and Morningstar shall have no liability for any loss or unrealized gain arising
from such Restricted Company Stock.
If the Participant's account includes securities issued by the Plan Sponsor that are freely
marketable without restrictions ("Non -Restricted Company Stock"), a Participant may
Non -ERISA July 2021
retain some or all of the Participant's Non -Restricted Company Stock, or the Participant
may direct Morningstar to sell the Non -Restricted Company Stock according to a
methodology determined by Morningstar. If a Participant directs Morningstar to sell Non -
Restricted Company Stock, Morningstar will send a transaction instructing the Provider to
sell 25% the Participant's Non -Restricted Company Stock upon the Participant completing
a web session or upon Morningstar's quarterly review of the Participant's account. All of
the Participant's Non -Restricted Company Stock will be sold if the Non -Restricted
Company Stock balance reaches $3,000 or 3% of the Participant's account balance, or if
directed to do so by the Participant. Morningstar's methodology will also result in the sale
of any future contributions of Non -Restricted Company Stock that are allocated
automatically to the Participant's account(s). Participant has the ability to instead restrict
the sale of their Non -Restricted Company Stock.
VII. Brokerage Windows
Participants may receive the Advisory Services if Participants are partially invested within
their respective Plan in a self-directed brokerage account, mutual fund window, or other
similar investment vehicles (collectively "Brokerage Windows") that cannot feasibly be
administered in a managed account. However, Morningstar will only have discretion over
that portion of the Participant's Plan account balance invested outside of the Brokerage
Window. Plan Sponsor and Morningstar will jointly ensure that this limitation is
communicated to the Participant. Morningstar shall address this limitation in any written
materials discussing the Advisory Services and Plan Sponsor shall ensure that such written
materials are provided to Participants, as necessary.
VIII. Source Restrictions
Plans that have source restrictions where different investment options are assigned for
different money sources cannot be used in conjunction with the Advisory Services.
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EXHIBIT B TO INVESTMENT ADVISORY SERVICES AGREEMENT
Fees
If the Plan elects to receive the Managed Account Services, the Plan shall pay Morningstar an annual fee,
paid monthly, of an amount equal to 25 basis points to Morningstar (the "Morningstar Investment
Management Fee") and 20 basis points may be charged by the Service Provider on the net assets under
management ("AUM") in the Plan account of each Participant enrolled in the Managed Account Services
as of the last day of the month. Plan Sponsor shall contact Service Provider for the fmal fee. The Service
Provider shall deduct the Morningstar Investment Management Fee from the enrolled Participant's Plan
account and remit the fees to Morningstar. The AUM shall exclude the following:
• Outstanding loan amounts,
• Amounts in adjustment accounts,
• Self-directed brokerage balances,
• Company stock, and
• Any other assets excluded from the Managed Account Service.
Plan Participants that enroll or unenroll or terminate and distribute their accounts in the Managed Account
Service in the middle of a month will be pro -rated based on the number of days the account is active based
on a percentage of the total number of days in the month.
Collection Authorization and Payment Terms
The parties hereby agree that Service Provider shall collect all applicable fees from each Participant's Plan
account and is hereby authorized to remit such fees to Morningstar. The parties agree and acknowledge that
Service Provider shall collect and remit the Morningstar Investment Management Fee in monthly
installments in arrears beginning at the end of the month in which the Morningstar Investment Management
Fees were earned by Morningstar.
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