Investment Advisory Services Agreement Participant Directed Accounts

Transcription

1 Investment Advisory Services Agreement Participant Directed Accounts THIS AGREEMENT made this 1st day of July 2014 by and between: Total Compensation Group Investment Advisory Services, LP, a Texas limited partnership ( TCG Advisors, LP or TCG ); and Highland Community Charter School, a charter school chartered under the laws of the State of California (the Investor ). WITNESSETH: WHEREAS, TCG is a registered investment adviser with the Securities and Exchange Commission ( SEC ) and is qualified to do business in California (name of State); WHEREAS, the Investor wishes to obtain the investment advisory services of TCG for its 401(a) Plan ( Plan ); and WHEREAS, TCG desires to perform such investment advisory services on the terms and conditions set forth herein. NOW, THEREFORE, in consideration of the mutual covenants herein contained, the legal sufficiency of which is hereby acknowledged, and intending to be legally bound, the parties agree as follows: 1. Investment Advisory Services. TCG will provide to the Investor guidance regarding suggested investment weightings for the management of the assets of the Plan. TCG s investment advisory responsibility will be to construct, review and monitor an individual mutual fund portfolio and such other investments jointly determined by the Investor and TCG to be appropriate investments of the Plan, subject to the investment objectives and risk portfolios of the Plan ( Portfolio ). TCG s advice will encompass the initial review of the client s portfolio (if necessary), recommendations for a portfolio structure, recommended implementation of portfolio investments and ongoing recommendations on appropriate changes in portfolio holdings consistent with the objectives of the Plan. TCG s advisory services shall include: a. Provide quarterly portfolio review and performance analysis; b. Provide quarterly Portfolio recommendations including mutual funds or other investments to be offered in the Plan; c. Provide quarterly verbal communications with the Investor; d. Provide quarterly review and discussion of recommendations by the Investment Consultant, if any; e. Provide additional periodic reports on an as needed basis; f. Preparation or review of an Investment Policy Statement ( IPS ); g. Act as a fiduciary regarding the investments selected to be offered to participants in the Plan in which they may invest their account balances; h. Recommend investments for the Plan in accordance with the state laws applicable to such Plan, federal tax laws, federal labor laws and local policies of the Board(s) of the Investor(s) to the

2 extent such policies pertain specifically to the Plan; and i. Provide advice in designing and implementing the Plan investments. 2. Time Schedules. To provide for efficient implementation of these investment services, TCG will abide by the following timeline. a. A quarterly economic and market analysis will be conducted for the Investor as the basis for changing or maintaining the Plan s Portfolio structure in advance of or coincident with suggested Portfolio weightings. b. Quarterly Portfolio weighting recommendations will be provided to the Investor at a quarterly meeting on a date and time mutually agreeable to the Investor and TCG. Investor will have up to ten (10) business days prior to the suggested implementation date i.e., the date of any rebalancing and/or re-allocation to review the recommendations and make a decision concerning whether or not to implement the recommendation. c. If TCG does not receive approval from the Investor within ten (10) business days of submitting its recommendations to the Investor, portfolio rebalancing and the investment of future contributions made to the Plan will be made in accordance with the most recently previously approved investment recommendations. 3. Fees. TCG s fees under this Agreement shall be calculated and payable in accordance with Exhibit A. Amendments made by TCG require ninety (90) days written notice to the Investor. The fee may be paid to TCG from Plan assets or paid by the Investor directly to TCG. 4. Representations and Compliance Procedures. TCG is a registered investment advisor engaged in the business of providing investment advice on the management of mutual funds and individual securities. TCG s sole compensation for providing services to the Investor shall be those fees specified in this Agreement. Compensation to TCG will not vary based upon investment options selected by the Investor, nor shall TCG accept, if allowed to choose such acceptance, any additional fees, commissions, or other benefits from selected mutual fund companies whose funds are utilized by the Plan. In the event that TCG or any of its affiliates receive any form of compensation from mutual funds utilized by the Plan, such compensation shall be used to offset fees paid by Plan participants. 5. Representations of the Investor. The Investor represents that: a. It is completely independent of TCG and its affiliates; b. It is authorizing, by this writing, the advisory services contemplated in this Agreement, with full disclosure of the relationship between the investment advisory role of TCG and the securities and support services provided by TCG and/or its affiliates; c. It understands that this authorization is terminable at will, upon notice to TCG by the Investor. d. It is the fiduciary to the Plan and as such accepts the fund recommendations from TCG to be consistent with the individual Plan objectives and IPS. 6. Termination. This Agreement shall remain in full force and effect until: a. Terminated by the Investor, at will upon written notice; or 2

3 b. Terminated by notice from TCG to the Investor; or c. Terminated by either party in the event of insolvency, bankruptcy, receivership, dissolution, or liquidation of the other party, or an assignment by the other party for the benefit of creditors; or d. Terminated by either party providing a written statement by its counsel that legal or regulatory developments effectively prohibit the activities contemplated hereunder or materially affect continued performance. 7. Successors and Assigns. The rights, duties and obligations of the parties under this Agreement may not be assigned or assumed without the consent of the other party. Nothing herein shall cause a termination of this Agreement upon the reorganization of the Investor or TCG. Subject to the foregoing, this Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors or permitted assigns. Nothing in this Agreement is intended or shall be construed to confer upon any person other than the parties hereto and their successors and permitted assigns any right, remedy or claim under or by reason of this Agreement. 8. Entire Agreement. This Agreement shall constitute the entire agreement between Investor and TCG with respect to the subject of the services described herein. This Agreement may be amended, modified or replaced only by subsequent written agreement of the parties. No waiver of any term or condition of this Agreement shall be effective unless agreed to in writing between the parties. Any attempt to orally modify, amend or waive any term, condition or provision of this Agreement shall be null and void. 9. Severability. Where possible in the context of this Agreement, each provision of this Agreement shall be enforced and construed in such a manner as to be effective and enforceable under applicable law; however, if any provision of this Agreement should be held by a court of competent jurisdiction to be invalid, whether in whole or part, then the invalid provision shall be ineffective only to the extent so declared by such court and such invalidity shall not affect the remainder of such provision or the remaining provisions of this agreement. 10. Notices. Any notice provided for under this Agreement shall be given in writing signed by an authorized representative of the Investor or TCG and shall be (i) sent by first class mail with return receipt requested to the address specified in the execution of this Agreement, (ii) be delivered by hand, (iii) sent by facsimile to the party being notified at the facsimile number specified in said execution (or at such other facsimile number as may hereafter be specified in writing), or (iv) sent via electronic mail if the sender of the electronic mail verifies by telephone that the electronic mail has been received by the intended recipient. Any notice sent by mail shall be deemed to have been given on the date such notice is deposit in the U.S. mail, and if sent by facsimile, at the time and date shown on the transmission confirmation slip. Notwithstanding the foregoing, any notice or consent required by Section 6 above shall not subject to this Section 10, and TCG shall (i) actually deliver to Investor a copy of TCG s current Form ADV Parts IIA and IIB not less than 48 hours prior to entering into this Agreement with Investor, or (ii) the Investor shall have a right to terminate this Agreement without penalty within five (5) business days after entering into this Agreement. In addition, Investor shall have the right to receive annually TCG s then current Form ADV Parts IIA and IIB. TCG shall promptly provide Investor with any ADV updates or amendments (including its annually updated ADV). The individual signing this Agreement on behalf of the Investor hereby agrees to be responsible for providing TCG s Form ADV Parts IIA and IIB and any other required disclosure material to all individuals associated with the Investor, including members of the Investor s Board, and any other relevant parties who are entitled to receive such disclosure under applicable laws and/or Board policy. 3

4 11. Disputes, Venue, Choice of Law. The parties agree that all disputes shall be submitted to nonbinding mediation by a mutually agreeable mediator. Mediation fees shall be split equally among the parties. If the parties are still unable to reconcile their differences after the mediator issues its award, either party may file an action in any federal or state court located in Travis County, Texas. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE SUBSTANTIVE LAWS OF THE STATE OF TEXAS, WITHOUT GIVING EFFECT TO ANY RULES GOVERNING THE CONFLICT OF LAWS. 12. Partnership Changes. TCG shall advise the Investor of any change in the membership of TCG within a reasonable time after such change. 13. Privacy. TCG shall treat all investment data of the Plan as confidential to the extent it is not in the public domain and in accordance with TCG s Privacy Policy. IN WITNESS WHEREOF, and intending to be legally bound, the parties have caused this Agreement to be duly executed the day and year first aforesaid. TCG Advisors, L.P ( TCG ) Highland Community Charter School ( Investor ) By: By: Title: Title: Address: 900 S. Capital of TX Hwy, Suite 350 Address: 1333 Grand Avenue Austin, TX Sacramento, CA Telephone: 512/ Telephone: 916/

5 Exhibit A Fee Schedule Plan Assets Invested by TCG On the all Plan Assets: Net Annual Fee* (80 Basis Points**) * The net TCG investment advisory fee is calculated as of the last business day of each calendar quarter by charging basis points ( bps ) of the Plan s assets invested by TCG in accordance with the amount specified above. Additional expenses incurred by TCG for investment related services performed for the client outside of the basic services as defined herein will be billed to the Plan separately, with the prior approval of the Investor. In the event of termination of this Agreement, the fee will be adjusted, on a pro rata basis, to reflect the portion of the final quarter in which termination occurs. The Investor is encouraged to read the prospectus for each mutual fund or other investment for a more complete explanation of mutual fund fees and expenses. **On all assets. 5