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HomeMy WebLinkAboutContract - 05/01/2023 - 2046 RETIREMENT PLAN CONSULTING SERVICES AGREEMENT This agreement ("Agreement") is entered into between Shuster Advisory Group, LLC ("CONSULTANT"), a California limited liability company, and City of Cathedral City ("GUY') as further identified on Appendix A. CITY, as the responsible plan fiduciary for the City of Cathedral City Plan(s) as further identified in Appendix A, desires to engage CONSULTANT to provide the services described in this Agreement according to the terms of this Agreement. 1. Fiduciary Authority. CITY as the responsible plan fiduciary has the authority to designate investment alternatives under the Plan and the related trust, and to enter into an Agreement with third parties to assist in these and related duties. 2. Term. The term of this Agreement will commence May 1, 2023. 3. Services. CONSULTANT agrees to provide the following services to CITY: (A) Fiduciary Services: CONSULTANT will perform the Fiduciary Services described in Appendix B. (B) Non-Fiduciary Services: CONSULTANT will perform the Non-Fiduciary Services described in Appendix C. (C) CITY acknowledges that CONSULTANT has no responsibility to provide any services related to the following types of assets: employer securities; real estate (except for real estate funds and publicly traded REITs); stock brokerage accounts or mutual fund windows; in-plan retirement income annuity products; participant loans;non-publicly traded partnership interests; other non-publicly traded securities (other than collective trusts and similar vehicles);or other hard-to-value securities or assets. Such assets (except for real estate funds,publicly traded REITs,and collective trusts and similar vehicles) shall be referred to collectively as "Excluded Assets." The Excluded .Assets shall be disregarded in determining the Fees payable to CONSULTANT pursuant to this Agreement, and the Fees shall be calculated only on the remaining assets (the "Included Assets"). 4. Fees. (A) The compensation,direct and indirect, of CONSULTANT for the performance of the Services is described in Appendix D. 5. Fiduciary Status: Limitations on Functions. CITY acknowledges that: (A) In performing the Fiduciary Services, CONSULTANT is acting as a fiduciary of the Plan and as a registered investment advisor under the Investment Advisers Act of 1940. (B) In performing the Non-Fiduciary Services, CONSULTANT is not acting as a fiduciary of the Plan. (C) In performing both Non-Fiduciary Services and Fiduciary Services, CONSULTANT does not act as, nor has CONSULTANT agreed to assume the duties of, a trustee or the Plan Administrator, and CONSULTANT has no discretion or responsibility to interpret the Plan documents, to determine eligibility or participation under the Plan, or to take any other action with respect to the management, administration or any other aspect of the Plan. Page 1 of 9 (D) CONSULTANT does not provide legal or tax advice. (E) Investments are subject to various market, political, currency, economic, and business risks, and may not always be profitable. As a result, CONSULTANT does not and cannot guarantee financial results. (F) CONSULTANT may, by reason of performing services for other clients, from time to time acquire confidential information. CITY acknowledges and agrees that CONSULTANT is unable to divulge to the CITY or any other party, or to act upon, any such confidential information with respect to its performance of this Agreement. (G) CONSULTANT is entitled to rely upon all information provided to CONSULTANT (whether financial or otherwise) from reputable third parties or by CITY, CITY's representatives or third-party service providers to CITY, the Plan or CONSULTANT, without independent verification. CITY agrees to promptly notify CONSULTANT in writing of any material change in the financial and other information provided to CONSULTANT and to promptly provide any such additional information as may be reasonably requested by CONSULTANT. (H) CONSULTANT will not he responsible for voting (or recommending how to vote) proxies of any publicly traded securities (including mutual fund shares) held by the Plan (or its trust). Responsibility for voting proxies of investments held by the Plan or its trust remain with CITY(or,if applicable,the Plan participants). (1) CITY understands that CONSULTANT: (i) may perform other services for other clients, (ii) may charge a different fee for other clients, and (iii) may give advice and take action that is different for each client even when retirement plans are similar. 6. Representations of CITY. CITY represents and warrants as follows: (A) It is the responsible plan fiduciary for the control and/or management of the assets of the Plan, and for the selection and monitoring of service providers for the Plan. CONSULTANT is entitled to rely upon this statement until notified in writing to the contrary. (B) The person signing the Agreement on behalf of CITY has all necessary authority to do so. (C) The execution of this Agreement and the performance thereof is within the scope of the investment authority authorized by the governing instrument and/or applicable laws. The signatory on behalf of CITY represents that the execution of the Agreement has been duly authorized by appropriate action and agrees to provide such supporting documentation as may be reasonably required by CONSULTANT. (D) The Plan and related Trust permit payment of fees out of Plan assets. CITY has determined that the fees charged by CONSULTANT are reasonable and are the obligation of the Plan. 7. Representation of CONSULTANT. CONSULTANT represents as follows: (A) CONSULTANT is registered as an investment adviser ("R1A") under the Investment Advisers Act of 1940. (B) The person signing this agreement on behalf CONSULTANT has the power and authority to enter into and perform this Agreement. (C) CONSULTANT agrees to take reasonable steps to protect Private Participant Information and Plan Investment Data in its possession; Page 2 of 9 CONSULTANT is not responsible for the assessment of systems and procedures of third parties for the protection of plan and participant data; CONSULTANT is not responsible for the actions by or the failure to act by CITY, by other service providers, or by Plan participants to protect Data; CONSULTANT shall have no liability in the event of a Data breach or a violation of participant privacy rights (under the California Consumer Privacy Act or otherwise) unless said breach is the direct result of negligence,recklessness, or willful misconduct of an employee of CONSULTANT. 8. Standard of Care. (A) CONSULTANT will perform the Fiduciary Services described in Appendix B to the Plan in accordance with the standard of care of the prudent person rule set forth in ERISA Section 404(a)(1)(B). (B) CONSULTANT will perform the Non-Fiduciary Services described in Appendix C using reasonable business judgment and shall not be liable for any liabilities and claims arising thereunder, unless directly arising from CONSULTANT's intentional misconduct or gross negligence. 9. Termination. Either party may terminate this Agreement upon 30 days prior written notice to the other party. Such termination will not, however, affect the liabilities or obligations of the parties arising from transactions initiated prior to such termination, and such liabilities and obligations (together with the provisions of section 8, 17, and 18) shall survive any expiration or termination of this Agreement. Upon termination, CONSULTANT will have no further obligation under this Agreement to act or advise CITY with respect to services under this Agreement. 10. Receipt of Disclosure and Consent to Electronic Delivery. CITY acknowledges receipt and undertakes to review and consider the disclosures made by CONSULTANT (including in this Agreement, the Form ADV Part 2 and CONSULTANT's Privacy Policy),in particular the portions related to services,compensation,and potential conflicts of interest, as well as the remainder of the disclosures concerning, among other matters, background information such as educational and business history, business practices such as the types of advisory services provided, the methods of securities analysis used, and the like. Further,CITY consents to electronic delivery (via email or other generally accepted method) of current and future distributions of CONSULTANT's Form ADV Part 2 and Privacy Policy. Consent to electronic delivery may be canceled at any time by sending a written request to CONSULTANT. 11. Notices.Any and all notices required or permitted under this Agreement shall be in writing and shall be sufficient in all respects if (i) delivered personally, (ii) mailed by registered or certified mail, return receipt requested and postage prepaid, or (iii) sent via a nationally recognized overnight courier service to the CITY's address listed on Appendix A and CONSULTANT's address 225 S.Lake Ave.,Ste.600,Pasadena,CA 91101,or such other address as any party shall have designed by notice in writing to the other party. 12. Assignability. This Agreement is not assignable by either Party hereto without the prior written consent of the other Party. 13. Effect. This Agreement shall be binding upon and shall inure to the benefit of the Parties and their respective heirs, successors, survivors, a. strators and assigns. Page 3 of 9 14. Entire Understanding and Modification. This Agreement constitutes and contains the entire understanding between the parties and supersedes all prior oral or written statements dealing with the subject matter herein.This Agreement can be amended or modified by the written consent of the Parties. 15. Severability. If any one or more of the provisions of this Agreement shall, for any reason, be illegal or invalid, such illegality or invalidity shall not affect any other provision of this Agreement and this Agreement shall be enforced as if such illegal or invalid provision had not been contained herein. 16. Headings.All headings used herein are for ease of reference only and in no way shall be construed as interpreting, decreasing or enlarging the provisions of this Agreement. 17. Applicable Law;For .The laws of the State of California shall govern this Agreement in all respects,including but not limited to the construction and enforcement thereof,unless otherwise preempted or superseded by federal law. Legal actions concerning any dispute, claim or matter arising out of or in relation to this Agreement shall be instituted in the Superior Court of the County of Riverside, State of California, or any other appropriate court in such county, and CONSULTANT covenants and agrees to submit to the personal jurisdiction of such court in the event of such action. 18. Amendment Process. The Agreement may be modified, by written agreement of both CI FY and CONSULTANT. 19. Waiver of Limitation. Nothing in this Agreement in any way constitutes a waiver or limitation of any rights which CITY or Plan or any other party may have under federal or state securities laws. This Agreement constitutes both an agreement between the parties and a disclosure statement. The Parties have caused this Agreement to be executed by their duly authorized officers as of the date set forth above. This Agreement is not binding on CONSULTANT or the CITY until each has accepted it, in writing, as indicated by their signatures below. CITY: City of Cathedral City CONSULT T: Shuster Advisory Group,LLC: 47-) Name: Charles McClendon Name: Mark Shuster Title: Ciry Manager Title: Managing Member Date: Date: /126 ATTEST: _ i •f. Tracey H liosil o, City Clerk APPRO STDm: Eric S. Vail, City Attorney Page 4 of 9 *The CITY is si: g this Agreement both as the employer that sponsors the Plan and as the fiduciary responsible for selecting the Plan's investments and engaging its service providers. The remainder of this page is intentionally left blank. Page 5 of 9 APPENDIX A— CLIENT/P N SPONSOR - P N INFO ' TION CITY/Plan Sponsor City of Cathedral City Plan Name 1 Type of Plan City of Cathedral City 457(b) Plan 0401(k) 457(b) 0401(a) 0403(b) 0Part-time Seasonal (OBRA) I:Retiree Health Savings ElDefined Benefit Plan [1 Other: Plan Name 2 Type of Plan City of Cathedral City 401(a) Plan 0401(k) 0457(b) Z 401(a) 171403(b) ▪Part-time Seasonal(OBRA) ERetiree Health Savings 0 Defined Benefit Plan [1 Other: Plan Name 3 Type of Plan O 401(k) 0457(b) 0401(a) 0403(b) Part-time Seasonal (OBRA) EIRetiree Health Savings 0Defined Benefit Plan 00ther: _ Plan Name 4 Type of Plan 0401(k) 0457(b) 0401(a) 0403(b) 0Part-time Seasonal (OBRA) [1 Retiree Health Savings Defined Benefit Plan [1 Other: Plan Name 5 Type of Plan 0401(k) 0457(b) 0401(a) 0403(b) O Part-time Seasonal(OBRA) Retiree Health Savings I Defined Benefit Plan E Other: Mailing Address City State Zip Code 68700 Avenida Lab o Guerrero Cathedral City CA 92234 Legal Address ( Same as Mailing Address) City State Zip Code Page 6 of 9 APPEN 1 IX - FI I UCIARY SE ' VICES CONSULTANT will perform the following fiduciary services: 1. Development of an Investment Policy Statement (IPS). The IPS establishes the investment policies and objectives for the Plan(s) and shall set forth the asset classes and investment categories to be offered under the Plan(s), as well as the criteria and standards for selecting and monitoring the investments. The CITY shall have the ultimate responsibility and authority to establish such policies and objectives and to adopt the investment policy statement. 2. Consistent with the Investment Policy Statement, CONSULTANT will select the initial investment options within the Plan(s). 3. CONSULTANT will periodically review the investments within the Plan(s) and shall be responsible for making additions/deletions thereto. 4. CONSULTANT will provide periodic investment advisory reports that document consistency of fund management and performance to the guidelines set forth in the IPS, and to make recommendations to maintain,or remove and replace investment options.Reports to include Market Overview,In-Depth Portfolio Summary, Plan Asset Allocation Analysis and Fund Performance Comparison to the Index. 5. Meet with CITY on a periodic basis to discuss reports and recommendations. 6. Annually review the IPS with the CITY to ensure it continues to meet the CITY's needs. 7. Selection of a default investment for participants who fail to make an investment election. 8. Coordinate the Deferred Compensation Committee meetings, record the meeting minutes and provide minutes to the attending members. LIMITATIONS ON FIDUCIARY SERVICES CONSULTANT shall not be responsible or liable for the recommendations of or services rendered by anyone other than CONSULTANT. The ability to perform the above services is contingent upon the rules, policies, processes, and responsiveness to our requests for information of CITY,Plan Sponsor,Record Keeper(s), and/or Third-Party A. *strator(s). Page 7 of 9 APPENDIX C -NON-FIDUCIARY SERVICES CONSULTANT will perform the following Non-Fiduciary services: 1. Provide Plan design consulting and Plan document review 2. Provide vendor management/issue resolution 3. Provide consulting assistance on fiduciary best practices 4. Assist in the transition of previous record-keeper(s) and/or Plan provider(s) 5. Provide custom communications when needed 6. Assist in communications with recordkeeper(s) and/or Plan provider(s) 7. Distribute Plan level newsletters 8. Provide RFP services and Plan fee negotiations 9. Incumbent vendor and fee review 10. Contract review support 11. Employee education 12. Provide assistance with mandatory and optional legislative changes LIMITATIONS ON NON-FIDUCIARY SERVICES CONSULTANT shall not be responsible or liable for the recommendations of or services rendered by anyone other than CONSULTANT. CONSULTANT and CITY/Plan Sponsor will work together to determine mutually agreed upon for services requiring both parties coordinate and/or attend. The ability to perform the above services is contingent upon the rules, policies,processes, and responsiveness to our requests for information of CITY, Plan Sponsor,Record Keeper(s), and/or Third Party A. 'strator(s). Page 8 of 9 APPENDIX D - FEE SCHEDULE 1. All fees are billed in arrears. 2. The initial fee will be the amount prorated for the number of days included in the initial billing period from the effective payment start date. 3. If this Agreement is terminated before the end of a billing period, CONSULTANT is entitled to a fee,prorated for the number of days in the billing period prior to the effective date of termination. 4. All fees will be due and payable within 30 days and are payable to "Shuster Advisory Group,LLC" 5. The annual fee for services is as follows: Beginning with the Effective Date of this Agreement and continuing until the earlier of the date the plans are converted to a new record-keeper and assets from the prior record-keeper are transferred, the date the plans are converted to a new record-keeper and the first payroll deferral is processed by the new record-keeper, or the date it is decided to remain with the incumbent record-keeper and new pricing is implemented, if applicable, (hereafter known as the "Conversion Date") the fee for service is $2,666.67 per month. Fees will accrue and be paid from Plan assets to CONSULTANT by the record keeper upon the Conversion Date. After the"Conversion Date," the fee for service is $2,666.67 per month. Fees will be deducted from Plan assets and will be paid to CONSULTANT by the record-keeper. At CONSULTANT's discretion the billing period described above may be adjusted to quarterly. Page 9 u 9