The ADP Pentegra 316 Advantedge Presented by Pete

The ADP - Pentegra 3(16) Advantedge™ Presented by: Pete Swisher, CFP®, CPC, TGPC Senior Vice President - National Practice Leader September, 2019 For ADP Representative Training Only. Not for Public Distribution.

Working together to drive more successful plan outcomes

Fiduciary Liabilities and Burdens are Real are fiduciaries § Employers are legally responsible for plan administration § Employers are required to assure the plan is administered properly § Most plan mistakes involve plan administration § Legal consequences for the business owner Legal consequences exists for the business owner

Some Of The Top Plan Mistakes Plan document not updated to reflect law changes Not satisfying non -discrimination tests (ADP & ACP) Failure to follow plan terms Not notifying all eligible employees of their opportunity to defer Not using the plan’s definition of compensation for deferrals and allocations correctly Employer matching contribution errors Not complying with IRC Section 402(g) Not depositing employee elective deferrals in a timely fashion Hardship distribution issues Not making required minimum contributions for top-heavy plans Not filing a Form 5500 series return Not distributing a Summary Annual Report to all participants

The Business Owner’s Perspective § Retirement plans are good for employees § Retirement plans help attract, retain and reward employees § Retirement plans are complicated § I don’t have—or want—the knowledge of how they work § I don’t have time to deal with managing plan details § I need to focus on running my business § Make it easy for me!

What 3(16) Does for the Business Owner § Saves me time § Takes work off my desk § Reduces compliance burdens § Decreases potential liability § Eliminates complex responsibilities § Saves money by saving time § Helps ensure my business is competitive § Improves plan outcomes

ADP & Pentegra Goals Build Awareness Benefits of Fiduciary Solution Capitalize on Current Prospect Pipeline Up-Sell Existing Customers § § § Fiduciary solutions help solve business owner’s problems Businesses are busy doing what they do Retirement plans can become complicated Businesses tend to not have plan expertise in house Time spent on the plan is time not spent on the business § Every plan will entertain a Pentegra fiduciary solution made available through ADP: “ADP can help make your retirement plan even better. Not only do we deliver a competitive retirement program that will help attract, retain and reward employees, but it will also save you time by helping reduce the burdens and risks of managing the plan, all of which lets you spend more time on your business. ” § Add fiduciary solutions to your existing customer conversations: “What we are doing now works, and it can be even better with a Pentegra 3(16) fiduciary solution. It will help you save time, reduce the stress of plan related work, save money, and help reduce risks and burdens. “

The Pentegra Difference, Our People… Make our expertise your expertise with access to in-house ERISA attorneys, ASPPA certified QPA, QKA, and CPC Account Managers, backed by a deep bench of expert retirement plan professionals 75 year legacy serving as an institutional fiduciary Unmatched level of fiduciary expertise and support in the industry Serving thousands of complex retirement plans nationwide One of the most experienced 3(16) Administrators in the nation Deep bench of highly credentialed professionals

Transfer Burdens and Responsibilities to Pentegra With Pentegra’s 3(16) services, employers can insulate themselves against these errors to a greater level than the typical TPA arrangement provides § Provides a level of comfort and relief § Key retirement plan responsibilities are being handled for them § Clarifies the employer’s role and responsibilities § Positions ADP as a trusted partner in their success

There’s An Easier Way… 3(16) Fiduciary Outsourcing Pentegra’s 3(16) Fiduciary services, made available through ADP’s recordkeeping platform shift certain responsibilities from your organization to Pentegra, transferring many of the legal and operational burdens of managing a retirement plan § Fiduciary outsourcing makes a retirement plan less burdensome § Transfers certain legal responsibilities to an institutional fiduciary § Pentegra assumes responsibility for key retirement plan tasks § All of which makes retirement easier and more effective

The Conversation: Time is Money Managing a retirement plan is time consuming. “Time is better spent running your business. ” There are compliance burdens and administrative responsibilities. The commitment of time and energy is overwhelming. “The retirement plan shouldn’t distract from running your business. ” “Retirement plans are hard to understand require specific skills. ” A trusted fiduciary partner means a better retirement plan. “Having professionals on board will provide you peace of mind. ”

Start the Conversation by Asking These Questions § Business owners like you are busy. Is your is time well spent? § How much time can you spend on building and maintaining your retirement plan? § How much time in a given day are you taking to manage your retirement plan? § How do problems get resolved? § Are you a fiduciary? § How do you feel about your role as a fiduciary? § How do you help employees understand the retirement plan? § How do you evaluate if your plan is effective?

A Win-Win For the Business Owner § Allows an employer to reduce their workload § Saves time, and time is money for business owners § Provides relief from key compliance burdens by transferring the responsibility to Pentegra § Saves money—cost is reasonable when compared to the amount of time and work it costs the business owner § Makes it easy to offer employees a comprehensive and competitive retirement plan § Allows owner to focus on growing their business § As a business owner, isn’t this what’s most important to you?

ADP + Pentegra = A Powerful Team § ADP provides recordkeeping platform and services § Pentegra provides varying levels of 3(16) fiduciary support, based on how much the client desires Less work, save time Reduce risk & burdens Improved Outcomes

Three Levels of 3(16) Fiduciary Support Basic 3(16) Enhanced 3(16) Comprehensive 3(16)

Basic 3(16) Product Sign & File 5500 Fiduciary Document Vault Interpret Plan Provisions Fiduciary Warranty Home Loans Hardship Withdrawals Plan Scorecard (coming in 2020)

Enhanced 3(16) Product Sign And File 5500 Interpret Plan Provisions Fiduciary Warranty Fiduciary Document Vault Review Contribution Calculations Review Compliance Tests Review Census Data Plan Audit Support Hardship Withdrawals Home Loans QDROs Plan Scorecard (coming in 2020)

Comprehensive 3(16) Product Pentegra as Named Plan Administrator Fiduciary Warranty Fiduciary Document Vault Operational Compliance Oversee Plan Document Interpret Plan Provisions Required Plan Amendments Optional Plan Amendments SPD and SMM Government Reporting Sign And File 5500 Participant Notices Plan Audit Support SAR Annual Plan Review Compliance Testing Review Contribution Calculations Force-outs Eligibility Enrollment Vesting Notice and Document Delivery Participant Fee Disclosure Service Provider Fee Disclosure Loans Hardship Withdrawals QDROs Notices of Claims & Appeals Forfeitures & Suspense Accounts Plan Scorecard (coming in 2020) Distributions

Pricing Basic 3(16) Product § $600 annual fee § Paid by Participant § § Home Loans - Included Hardship (for limited a time) - Included Enhanced 3(16) Product § $2, 000 plus $5. 00 per eligible annual fee § Paid by Participant § QDRO - $525 § Home Loans - Included § Hardship (for limited a time) - Included Comprehensive 3(16) Product § $35 per eligible § Minimum 400 eligible

Key Talking Points Why Pentegra? History and Reputation § § 75 years of serving sponsors as an independent 3(16) administrative fiduciary Pentegra finds errors and plan challenges that others may miss Recognized nationally as a fiduciary expert and industry thought leader A CEFEX-certified TPA Service to our clients is in our DNA § § Pentegra values the plans they service. Pentegra’s mission is to serve, rather than sell Our goal is error free service 3(16) Expertise § § § Our team has expertise and tenured experience We combine technology to provide impressive repeatable results Protecting plan sponsors and participants is Pentegra’s priority

Key Talking Points What’s Important to the Sponsor? Reduces Administrative Responsibilities § Pentegra is an extra set of eyes on the plan Simplifies the Complex § Pentegra removes the chores of the plan, making it easier to have a successful outcome Minimizes Risk § Pentegra will take on different levels of fiduciary responsibilities that others won’t

Key Talking Points What’s Important to the Micro-Small Market Advisor? Securing a Client § Finding and retaining DC clients is an important initiative for many Financial Advisors today Not Having to Be an Expert § Financial Advisors do not have the time to become an expert. They often already have the client’s Wealth Management business. Finding more Wealth Management Clients § Every plan offers Wealth Management opportunities (rollovers, estate planning, personal money management)

FAQ What is happening with ADP and Pentegra? ADP and Pentegra have established an enterprise relationship. ADP will begin selling Pentegra 3(16) services to plan sold on 9/30 and after. Nothing in this material should be construed to create or provide for any other relationship between ADP and Pentegra, including, but not limited to joint venture or partnership.

FAQ What are the new products being offered? Three products offered, Basic 3(16), Enhanced 3(16) and Comprehensive 3(16). ADP will serve as the bundled recordkeeper and Pentegra will provide 3(16) services “On top of the ADP services” Basic 3(16) for $600 annually Enhanced 3(16) for $2, 000 plus $5 per eligible Comprehensive 3(16) for $35 per eligible ¡ Sign and File 5500 ¡ Interpret Plan Provisions ¡ Fiduciary Warranty ¡ Fiduciary Document Vault ¡ Home Loans ¡ Hardship Withdrawals ¡ Plan Scorecard - Coming in 2020 ¡ Sign and File 5500 ¡ Interpret Plan Provisions ¡ Fiduciary Warranty ¡ Fiduciary Document Vault ¡ Review Compliance Tests ¡ Review Contribution Calculations ¡ Plan Audit Support ¡ Review Census Data ¡ Home Loans ¡ Hardship Withdrawals ¡ Qualified Domestic Relations Orders (QDROs) $525 per event ¡ Plan Scorecard - Coming in 2020 ¡ Named as Plan Administrator ¡ Sign and File Form 5500 ¡ Operational Compliance ¡ Fiduciary Warranty ¡ Fiduciary Document Vault ¡ Oversee Plan Document ¡ Interpret Plan Provisions ¡ Summary Plan Description (SPD) & Summary Material Modification (SMM) ¡ Required Plan Amendments ¡ Optional Plan Amendments ¡ Participant Notices ¡ Summary Annual Report (SAR) ¡ Loans ¡ Hardship Withdrawals ¡ Distributions ¡ Qualified Domestic Relations Orders (QDROs) $525 per event ¡ Plan Scorecard – Coming in 2020

FAQ How is this 3(16) service different than what Pentegra does today? § The current Pentegra 3(16) services are typically offered with Pentegra providing TPA and 3(16) in a combined package. These new products leverage Pentegra 3(16) services and fiduciary process, combined with ADP’s recordkeeping. § Said differently, instead of doing the work, we are reviewing the work.

FAQ How will these new products be sold? § § The ADP sales team will be the primary sales force working with prospective clients and Advisors. The Pentegra sales team will act in a support capacity. It is anticipated that the Pentegra Regional Directors will play a more significant role in selling the Comprehensive product. Are these new products available with any other Recordkeeper? § No, these products have been designed in conjunction with ADP and require a significant technology interaction with ADP for automation and scale.

FAQ How are Financial Advisors (FAs) involved? § Advisors are a critical part of the service delivery for both ADP and a Pentegra. In fact, roughly 95% of sales come via an Advisor. § This allows Pentegra to work with a new set of FAs—and distribution partners (typically larger, national Broker Dealers)—who traditional focus on wealth management. Can I buy the ADP product directly from Pentegra? § No, these products are sold by ADP. However, Pentegra does offer a wide array of services including a full service 3(16) offering. Contact the Pentegra Solutions Center or local Regional Director for assistance.

FAQ What should I do if I get a call or email from one of these new ADP clients? § Any service calls or emails should be referred to: Fiduciary. Support_ADP@pentegra. com Where can I find product details and materials on these products? § www. pentegra. com/Pentegra_adp_316/ What if a client wants to terminate their 3(16) services with Pentegra? § Plan sponsors should contact ADP to change any of their services on these products, including plan details, contact information or Advisor information. Where should a Plan sponsor go with billing questions? § ADP will be handling all client billing. § Plan sponsors should contact ADP to discuss billing questions.

FAQ What Other Recordkeepers Does Pentegra Work With? Pentegra works with the following Recordkeepers to provide 3(16) services: § § § § § Nationwide Empower Voya John Hancock Principal Ascensus Transamerica TIAA One. America

What Types of Plans Can Offer These Services? Single employer DC plans § 401(k) § 403(b) § Profit Sharing

Resources from Pentegra Marketing and Training Materials Pentegra-ADP Web Page Sales Tips Basic 3(16) & Enhanced 3(16) Sell Sheet Training Power. Point Comprehensive Sell Sheet Advisor Sell Sheet Pentegra 3(16) Fiduciary Outsourcing Video Talking Points Pentegra Territory Map

The ADP-Pentegra Advant. Edge Sign & File 5500 Reduce Risk & Burdens Less Work, Save Time Improved Outcomes

We’re Here to Help Questions about the program or how it works? Contact us. Pentegra Contacts Bruce Harrington, AIF® & CRC® bharrington@eyesupconsulting. com cell: 617 -515 -8710 Pete Swisher, CFP®, CPC, TGPC Senior Vice President - National Practice Leader pete. swisher@pentegra. com cell: 859 -608 -9920

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