Cupertino City Council
May 21, 2024

INVESTMENT MANAGEMENT AGREEMENT
(Institutional Client, Non-ERISA)
City of Cupertino ("City") hereby retains Chandler Asset Management, Inc. ("Financial Consultant") as Investment Adviser on the terms and conditions set forth herein.

1. Term . The term of this Agreement shall commence upon the execution of this Agreement and shall continue until December 31, 202 I. The City may, at its option and the discretion of the City Manager, exercise up to two (2) one-year extensions by providing written notice of intent to extend the Agreement to Consultant not less than thirty (30) days prior to the expiration of the previous term . Such extension shall be at the same price and conditions set forth herein.

2. Scope of Services. Consultant shall perform all the services described in the Scope of Services attached hereto as Exhibit A and incorporated herein by reference.

3. Fees. City shall compensate Consultant monthly an amount calculated on the average market value of City 's portfolio , including accrued interest , in accordance with the following schedule:

Assets Under Management
First $25 million
Next $25 million
Next $50 million
Assets in excess of $100 million
Annual Investment Management Fee

0.10 of I% (10 basis points)

0.08 of 1 % (8 basis points)

0.07 of 1 % (7 basis points)

0.06 of I % (6 basis points)
No fees shall apply to funds held in local government investment pools or other vehicles not under management by Financial Consultant.

The fees expressed above do not include any custody fees that may be charged by City's bank or other third party custodian.

Fees shall be prorated to the effective date of termination on the basis of actual days elapsed, and any unearned portion of prepaid fees shall be refunded. City is not required to pay any start-up or closing fees; there are no penalty fees.

Fees shall be deducted monthly in arrears from the City custody account identified by City Representative.

4. City Representative. In its capacity as investment manager, Consultant shall receive all instructions, directions and other communications on City's behalf respecting City's account from Administrative Service s Director, or his/her designee (Representative). Consultant is hereby authorized to rely and act upon all such instructions, directions and communications from such Representative or any agent of such Representative . The Representative may be changed by a resolution of the Cupertino City Council. In the absence of a designated Representative, the City Manager may act as Representative.
/11 ves1111e111 Ma11age 111e111 A11ree111e111 I Revised Nove 111ber 20 18

5. Investment Policy. In investing and reinvesting City's assets, Consultant shall comply with City's Investment Policy, attached hereto as Exhibit B, as it may be amended by the Cupertino City Council from time to time.

6. Authority of Consultant. Consultant is hereby granted full discretion to invest and reinvest all assets under its management in any type of security it deems appropriate, subject to the instructions given or guidelines set by Representative, consistent with City's Investment Policy.

7. Notices. All reports and other communications required hereunder to be in writing shall be delivered in person, or sent by first-class mail postage prepaid , by overnight courier, by confirmed facsimjle with original to follow or by confirmed electronic mail with proof of receipt to the addresses set forth below. Either party to this Agreement may , by written notice given at any time, designate a different address for the receipt of reports and other communications due hereunder.

Chandler Asset Management
Attn: Nicole Dragoo
6225 Lusk Boulevard
San Diego , CA 92121
ndragoo@Chandle rasset.com
City Representative
Kristina Alfaro or Zach Korach
10300 Torre A venue
Cupertino, CA 95014
KristinaA@cupert ino.org ,
[email protected]

8. Electronjc Delivery. From time to time, Consultant may be required to deliver certain document s to City such as account information , notices and required disclo sures. City hereby consents to Consultant's use of electronic mean s, such as email, to make such delivery. Thi s delivery may include notification of the availability of such document(s ) on a website, and City agrees that such notific ation will con stitute "delivery " . City further agrees to provide Consultant with City 's email address(s) and to keep this information current at all time s by promptly notifying Consultant of any change in email address(s) .

City email address(s) : [email protected] , [email protected] , Beth V@cuper tino.org

9. Proxy Voting . Consultant will vote proxies on behalf of City unless otherwise instructed .

Consultant has adopted and implemented written policies and procedure s and will provide City with a description of the proxy voting procedure s automatically. Consultant will provide information regarding how City's proxie s were voted annually and upon request. To reque st proxy policie s or other information, please contact us by mail at the address provided , by calling 800-317-4 747 or by emailing your request to i nfo @Chand lerasset.com .

10. Custody of Securities and Funds. Consultant shall not have custody , possess ion , or direct access to the funds or securities that City has placed under its management. City shall appoint a custodian (Wells Fargo) to take and have possess ion of its assets. City recognizes the import ance of comparing statements received from the appointed custodian to statements received from Consultant. City recognizes that the fees expres sed above do not include fees City will incur for custodial services.
2 /11 ves1111enr Mww ge111e111 Ag ree111e111 I Re1•ised Nove111ber 20 / 8

11. Qualification s and Standard of Care. Consultant represen ts to have the qualific ations and skill s in investment man agement to perform the Services in a competent and profe ssion al manner.

Services may only be performed by qualified and experienced personn el of Consultant who are not employed by City and do not have any contractual relationship with City excepting this Agreement. All Services must be performed as specified to City's reasonable satisfaction and in accordance with City's investment policy and best practices in the industry.

12. Permits and Licen ses. Consultant warrants that they are properly licen sed, registered, and/or certified to perform the Services, as required by law, and that they have procured a valid City Business Licen se.

13. Valuation. Consultant will value securities held in portfolios managed by Consultant no less than monthly. Securities or investments in the portfolio will be valued in a manner determjned in good faith by Consultant to reflect fair market value.

14. Investment Advice. City recogruzes that the opinions, recommendations and actions of Consultant will be based on information deemed by it to be reliable, but not guaranteed to or by it. Provided that Consultant acts in good faith and in accordance with the qualifications and standard of care required , City agrees that Consultant will not in any way be liable for any reasonable error in judgment or for any act or omission , except as may otherwise be provided for under this contract, the Federal Securities laws or other applicable laws .

15. Payment of Commjssions. Consultant may place buy and sell orders with or through such brokers or dealers as it may select. In accordance with its policy and practice , Consultant shall strive for the best price and execution and for commjssion and discounts which are competitive in relation to the value of the transaction and which comply with Section 28(e) of the Securitie s and Exchange Act. Nevertheless , it is under stood that Consultant may pay a commission on transactions in excess of the amount another broker or dealer may charge, and that Consultant makes no warranty or representation regarding commjssions paid on transactions hereunder.

16. Other Clients. It is further understood that Consultant may be acting in a similar capacity for other institutional and individual clients, and that investments and reinve stments for City's portfolio may differ from those made or recommended with respect to other acco unts and client s even though the inve stment objectives may be the same or similar. Accordingly, and notwithstanding Financial Consultant's duty of loyalty to City, it is agreed that Consultant will have no obligation to purchase or sell for City's account any securities which it may purchase or sell for other client s.

17. Confidential Relationship. The Parties acknowledge and agree that they are entering into a confidential relationship. The Parties further agree that the terms and conditions of this Agreement and all information , records , and advice furnished by either party to the other, to their respective legal counsel, accountants , or other professional advisors as needed to implement this agreement , shall be held confidential. No City records or information shall be used for marketin g or other business purpo ses (other than those necessary for Financial Consultant to fulfill its responsibilities he~under , consistent with Financial Consultant's Form ADV), or disclosed to third partie s except (i) as required by law , rule, or regulation, (ii) as requ ested by a regulatory 3 /11 vesr111e111 Ma11age111e111 A1;ree111e111 / Revised Nove111ber 20/ 8 agency with proper authority, (iii) when the information has become public by means other than mi stake or wrongful conduct of either Party , (iv) or as otherwise agree d by the parties in writing.

18. Independent Contractor. At all times during the term of this agreement, Financial Consultant shall be an indep endent contractor and shall not be an employee of City. No relationship of employer and employee is created by this agreement between the City and Financial Consultant or any subcontractor or employee of Financial Consultant. City shall have the right to control Financial Consultant only with respect to specifying the results to be obtained from Financial Consultant pursuant to this agree ment . City shall not have the right to control the means by which Financial Consultant acco mplishes services rendered pursuant to this agreement.

19. Duty of Loyalty. Financial Consultant is in a position of trust with the City and owes the City a duty of loyalty to act in the City's best interests at all times during the performance of thi s agreement. City relies on Chandler's representation and reputation of high ethical standard s and professional conduct in entering into this agreement. This duty of care includes the duty to protect City proprietary , financial , and other non-public official information/records from unauthorized access and use .

20. Indemnity. Financial Consultant agrees to faithfully discharge the dutie s herein set forth and shall indemnify, hold harmles s and, not excluding City's right to participate , defend City, its officers, officials, agents, and employee s (here inafter refe1Ted to as "Indemnitee "), through legal counsel acceptable to City, from and against all liabilitie s, claim s, actions, darpage s, losse s, and expenses including without limitation reasonable attorneys' fees and costs, (hereinafter referred to collectively as "claim s") from and agai nst any and all claim s resulting from the acts, omissions and negligent conduct of Financial Consultant or any of its owners, officers, directors , agents, employees or subcontractors with respect to the Financial Consultant's Scope of Work.

This indemnity include s any claim or amount arising out of or reco vered under the Workers' Compensation Law or arising out of the failure of the Financial Consultant to conform to any fed eral, state or local law, statute , ordinance, rule, regulation or court decree. It is the specific intention of the parties that the lndemnitee shall , in all instances, except for claims arising from the sole negligence or willful acts or omissions of the Indemnitee, be indemnified by Financial Consultant from and against any and all claim s. It is agreed that Financial Consultant will be responsible for prim ary loss investigation, defense and judgment costs where this indemnification is applicable. In consideration of the award of this contract, the Financial Consultant agrees to waive all rights of subro gation against City, its officers, officials , agents and employee s for losses arising from the work performed by Financial Consultant under this agreement.
21 . Insuranc e. Financial Consultant and subcontractors , if any, shall procure and maint ain until all of their obligations have been discharged , including until any warranty periods under this Agreement are satisfied, insurance against any and all claim s, including claims for injury to persons or dama ge to property , which may arise from or in connection with the performance of the work here under by the Financial Consultant , his agents, representatives, employees or subcontractor s, as required by Financial Consultant Insurance Requirement s, attached and incorporated herein as Exhibit C.
4 ln ve.w11e111 Mw wxe 111e111 Ax ree111e1i1 I Revised Novembe r 20 / 8

22. Conformance to Applicable Laws. Consultant shall comply with its standard of care regarding all applicable Federal, State, and municipal laws , rules and ordinances. No discrimination shall be made by Consultant in the employment of persons to work under this contract because of race , color, national origin, ancestry, disability , sex or religion of such person .

Consultant hereby promises and agrees to comply with all of the provisions of the Federal Immjgration and Nationality Act (8 U.S.C.A l 101 et seq.), as amended; and in connection therewith, shall not employ unauthorized aliens as defined therein. Should Consultant so employ such unauthorized aliens for the performance of work and/or services covered by this Agreement, and should any agency or instrumentality of the federal or state government , including the courts, impose sanctions against the City for such use of unauthorized aliens, Consultant hereby agrees to, and shall, reimburse City for the cost of all such sanctions imposed, together with any and all costs, including attorneys' fees, incurred by the City in connection therewith.

23. Licenses. Consultant warrants on behalf of itself , its employees, consultants and subconsultants that they are properly licensed, registered, and/or certified to perform the Services as required by law, and have procured a City Business License. Consultant's employees working under this Agreement must have the Certified Treasury Professional (CTP) designation/accreditation.

24. Conflicts of Interest. No officer, or employee of the City shall have any financial interest , direct or indirect, in trus Agreement, the proceeds thereof , the Consultant, or Consultant ' s sub­ contractors for this project, during his/her tenure or for one year thereafter. The Consultant hereby warrants and represents to the City that no officer or employee of the City has any interest , whether contractual , non-contractual , financial or otherwise , in this transaction, or in the business of the Consultant or Consultant's sub-contractors on this project. Consultant further agrees to notify the City in the event any such interest is discovered whether or not such interest is prohibited by law or this Agreement. Contractor may be required to file a conflict of interest form if Contractor makes certain governmental decisions or serves in a staff capacity, as defined in Section 18700 of the California Code of Regulations . Contractor agrees to abide by the City's rules governing gifts to public officials and employees.

25. Records. Consultant must maintain complete and accurate accounting records relating to its performance in accordance with generally accepted accounting principles . The records must include detailed information of Consultant's performance, benchmarks and deliverables, which must be available to City for review and audit. The records and supporting documents must be kept separate from other records and must be maintained for four years from the date of City's final payment.

26. No Assignment& Amendments. Neither party may assign, directly or indirectly , all or part of its rights or obligations under this Agreement without the prior written consent of the other party, which consent shall not be unreasonably withheld or delayed. This Agreement may be amended at any time by mutual agreement in writing.

27. Governing Law. It is understood that this Agreement shall be governed by and construed under and in accordance with the law s of the State of California. 5 l,11,es1111en r M a11a11e111 e111 A11ree111e11 1 I Revised Nove mber 2018

28. Severability. Any provision of this Agreement whjch is prohibited or unenforceable shall be ineffective only to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof.

29. Receipt of Brochure and Privacy Policy . City acknowledges receipt of the disclosure statement or "brochure" and "brochure supplement" also known as Part 2A and Part 2B of Form ADV, required to be delivered pursuant to Rule 204-3 of the Investment Advisers Act of 1940 (Brochure). City further acknowledges receipt of Consultant's Privacy Policy, as required by Regulation S-P .

30. Dispute Resolution and Venue. The Parties agree to meet and confer on any disputes arising out of Consultant's Services or this Agreement to attempt to reach an amicable resolution. Any controversy not resolved through the meet and confer process will be submitted to arbitration conducted under the provisions of the commercial arbitration rules of the American Arbitration Association. Arbitration must be commenced by service upon the other party of a written demand for arbitration or a written notice of intention to arbitrate, therein electing the arbitration tribunal. In the event the City does not make such election within thirty (30) days of such demand or notice, then the City authorizes Consultant to do so on the City's behalf. Arbitration proceedings shall be held in Santa Clara County. If the Parties elect arbitration, the arbitrator's award must be supported by law and substantial evidence and include detailed written findings of law and fact. The Parties may agree that judgment upon any award rendered by the arbitrators shall be final and may be entered in any court having jurisdiction thereof. This clause does not constitute a waiver of any right including the right to choose the forum , whether arbitration or adjudication, in which to seek resolution of disputes.

31. Termjnation. The City may, at any time and for any reason , with or without cause, termjnate this Agreement, by providing Consultant thirty (30) days written notice. Upon notice , the Agreement shall then be deemed terminated and no further work shall be performed by Consultant. If the Agreement is so terminated , the City shall pay Consultant the actual value of work performed up to the time of termination , provided that such work was/is of value to the City.

32. Attorney 's Fees. If City initiates legal action, files a complaint or cross-complaint, or pursues arbitration, appeal, or other proceedings to enforce its rights or a judgment in connection with this Agreement, the prevailing party will be entitled to reasonable attorney fees and costs.

33. Third Party Beneficiaries. There are no intended third party beneficiaries of this Agreement.

34. Waiver. Neither acceptance of the Services nor payment thereof shall constitute a waiver of any contract provision. City's waiver of a breach shall not constitute waiver of another provision or breach.

35. Entire Agreement. This Agreement represents the full and complete understanding of every kind or nature between the Parties , and supersedes any other agreement(s) and understanding( s), either oral or written, between the Parties. Any modification of this Agreement will be effective only if in writing and signed by each Party's authorized representative. No verbal agreement or implied covenant will be valid to amend or abridge this Agreement. If there is any inconsistency 6 In vest111e11t Ma11alie111e111 Aiiree111e111 I Re,·ised Nol'e111ber 20 18 between the main Agreement and the attachments or exhibits thereto, the text of the main Agreement shall prevail.

36. Inserted Provisions. Each provision and clause required by law for this Agreement is deemed to be included and will be inferred herein . Either party may request an amendment to cure mistaken insertions or omissions of required provisions. The Parties will collaborate to implement this Section , as appropriate.

37. Headings . The headings in this Agreement are for convenience only, are not a part of the Agreement and in no way affect, limit or amplify the terms or provisions of this Agreement.

38. Severability/Partial Invalidity. If any term or provision of this Agreement, or their application to a particular situation, is found by the court to be void, invalid, illegal or unenforceable, such term or provision shall remain in force and effect to the extent allowed by such ruling. All other terms and provisions of this Agreement or their application to specific situations shall remain in full force and effect. The Parties agree to work in good faith to amend this Agreement to carry out its intent.

39. Survival. All provisions which by their nature must continue after the Agreement expires or is terminated , including the Indemnification , Ownership of Materials/Work Product , Records , Governing Law and Attorney Fees, shall survive the Agreement and remain in full force and effect.

40. Notices. All notices , requests and approvals must be sent in writing to the persons below , which will be considered effective on the date of personal delivery or the date confirmed by a reputable overnight delivery service, on the fifth calendar day after deposit in the United States Mail , postage prepaid, registered or certified, or the next business day following electronic submission:

CONTRACTOR
By AM--rq;
Name : hJICQ I(!... D(?t
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Title: ['.\1'.X) le_c D
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By ~ uJr/wx11t
Name :;a O 5:Ji /l'IJ-/1-
Title: E'vf

CITY OF CUPERTINO
A Municipal Corporation
By: 11l@---ll--_:_----'-<----l,,,p,,I. ~ -'.!--'-- '
Name: ~ y{)
7 /11 vest111e111 Ma11a/(e111e111 A!i ree111e111 I Revised Nove 111ber 20 18

EXHIBIT A - SCOPE OF SERVICES

1. Provide full-time , investment management service s in acco rdance with the City 's Investment Policy .

2. Assist with reviewing and recommending any appro p riate amendments to the City ' s Investment Policy at the outset of the contract term , and assist with the annu al review and updat e of the Investment Policy.

3. Ass ist the City w ith developing a n appropriate cas h flow mod el to minimize balances held in highly liquid but low interestacco unt s.

4. Ass ist the City w ith matur ity analysis.

5. Perform analysis and revi ew inve stment s for compliance to the City 's goa l of soc ial and enviro nment al respons ibility , includin g, but not limited to the exclusion of invest men ts that direct ly or indirectly supp ort the production or dri lli ng of fossil fuels.

6. Wo rk with the City's third party custo dian (current ly Union Bank) for safekeep in g of sec uriti es and provide any services req uire d to exec ute and settle in vestment trad es .

7. Estab lish and recommend appropr iate in vestrnentbenc hm arks.

8. Provide detailed mo nthl y repo rts of investment portfolio activity , performa nce , ho ldin gs monthly , type , maturity , broker , duration , and benchmark compa rab le.

Prov ide monthly and quarterly report s to Cou nci l as required by the Investment Policy and annua l portfolio pe rform ance reports based on the C ity' s Investment Policy , quarterly period close and fiscal year.

9. Be available to F inance Department staff in a time ly manner by telephone o r emai l and meet w ith and provide info rm ation to Finance Department staff upon req uest , and if requested , to other interested parties such as the Investme nt Comm ittee , C ity Co uncil and/or C ity Ma nager.

10. Provide ass urance of portfolio comp liance wit h all federa l and Sta te of Californ ia laws as well as ordinances , resolutions , and policies of the City relating to the in vestme nt of publicfunds.

11. Annu ally perform due diligence reviews of the brok er/dealers , custod ian bank , and financial inst ituti ons uti lized by the Ci ty and provide s upp ortin g documentation to the City.
8 /11 veS11ne111 Ma11axe111e111 Ax ree111 e111 I Revised November 2018

12. The selected firm will not act as a custodian of assets in the account or have possess ion of any such assets.

13. The selected firm wil l act as a fiduciary age nt to the City , serv ing as an indepe ndent advisor to represent the best intere sts of the City.

14. Demonstrate independence from any financial institution or securitie s brokerage firm , or fully disclose any such relationships relev ant to qualified investment s for public secto r entities.
9 In vest111e111 Mc111age1nen1 Agree111en1 I Revised Nove111ber 20/8

EXHIBIT B - CITY OF CUPERTINO INVESTMENT POLICY
City of Cupertino
Investment Policy
June 5, 2018
POLICY
Under authority granted by the City Council, the City Treasurer and Deputy Treasurer are responsible for investing the surplus funds of the City.

The investment of the funds of the City of Cupertino is directed to the goals of safety, liquidity and yield. The authority governing investments for municipal governments is set forth in the California Government Code, Sections 53601 through 53659.

The primary objective of the investment policy of the City of Cupertino is SAFETY OF PRINCIPAL. Investments shall be placed in those securities as outlined by type and maturity sector in this document. Effective cash flow management and resulting cash investment practices are recognized as essential to good fiscal management and control. The City's portfolio shall be designed and managed in a manner responsive to the public trust and consistent with state and local law. Portfolio management requires continual analysis and as a result the balance between the various investments and maturities may change in order to give the City of Cupertino the optimum combination of necessary liquidity and optimal yield based on cash flow projections.

SCOPE
The investment policy applies to all financial assets of the City of Cupertino as accounted for in the Comprehensive Annual Financial Report (CAFR). Policy statements outlined in this document focus on the City of Cupertino's pooled, surplus funds, but will also apply to all other funds under the City Treasurer's span of control unless specifically exempted by statute or ordinance. This policy is applicable, but not limited to all funds listed below:
• General Fund
• Special Revenue Funds
• Capital Project Funds
• Enterprise Funds
• Internal Service Funds
• Trust and Agency Funds
• Any new fund unless specifically exempted
Investments of bond proceeds shall be governed by the provisions of the related bond indentures and/or cash flow requirements and therefore may extend beyond the maturity limitations as outlined in this document. Other post-employment benefit (OPEB) trust investments are governed by California Government Code Sections 53620 through 53622 and trust documents.

The trust is governed by a separate investment policy entitled Investment Policy Statement City JO
/11 vern11e111 M a11age111e111 Ag ree111e111 I Revised Nove111ber 20/8 of Cupertino Investment Trust that was reviewed by the City of Cupertino Audit Committee and adopted by the City Manager and the Acting Director of Administrative Services on May 6, 2014.

PRUDENCE
The standard to be used by investment officials shall be that of a "prudent person " and shall be applied in the context of managing all aspects of the overall portfolio. Investments shall be made with judgment and care, under circumstances then prevailing, which persons of prudence , direction and intelligence exercise in the management of their own affairs, not for speculation , but for investment, considering the probable safety of their capital as well as the probable income to be derived . It is the City 's full intent , at the time of purchase, to hold all investments until maturity to ensure the return of all invested principal dollars. However, it is realized that market prices of securities will vary depending on economic and interest rate conditions at any point in time. It is further recognized that in a well-diversified investment portfolio, occasional measured losses are inevitable due to economic, bond market, or individual security valuation fluctuations.

These occasional losses must be considered within the context of the overall investment program objectives and the resultant long-term rate of return. The City Treasurer and Deputy Treasurer , acting within the intent and scope of the investment policy and other written procedures and exercising due diligence, shall be relieved of personal responsibility and liability for an individual security's credit risk or market price changes, provided deviations from expectations are reported in a timely manner and appropriate action is taken to control adverse developments.

OBJECTIVES
The primary objectives, in order of priority , of the City of Cupertino 's investment activities shall be:

A. Safety of Principal
Safety of principal is the foremost objective of the City of Cupertino. Each investment transaction shall seek to ensure that capital losses are avoided, whether from issuer default, broker-dealer default or erosion of market value. The City shall seek to preserve principal by mitigating the two types of risk, credit risk and market risk.

Credit risk, defined as the risk of loss due to failure of the issuer of a security, shall be mitigated by investing in investment grade securities and by diversifying the investment portfolio so that the failure of any one issuer does not unduly harm the City's capital base and cash flow.

Market risk, defined as market value fluctuations due to overall changes in the general level of interest rates, shall be mitigated by limiting the average maturity of the City's investment portfolio (see maximum maturities) and structuring the portfolio based on historic and current cash flow analysis eliminating the need to sell securities prior to II
/11 ves1111e111 Ma11age111e111 Agree 111e111 I Revised November 20 18 maturity and avoiding the purchase of long term securities for the sole purpose of short term speculation.

B. Liquidity
The City's investment portfolio will remain sufficiently liquid to meet all operating requirements which might be reasonably anticipated and provide the City with adequate cash flows to pay its obligations over the next six months . Additionally, the portfolio should consist largely of securities with active secondary resale markets.

The City's investment portfolio shall be designed with the objective of attaining a rate of return throughout budgetary and economic cycles, commensurate with Cupertino ' s investment risk constraints and cash flow characteristics of the portfolio.

MAXIMUM MATURITIES
Maturities of investments will be selected based on liquidity requirements to· minimize interest rate risk and maximize earnings. Investment of surplus funds shall comply with the maturity limits as set forth in the California Government Code 53600, et seq. Where this section does not specify a limitation on the term or remaining maturity at the time of the investment, no investment shall be made in any security that at the time of the investment has a term remaining to maturity in excess of five years , unless the Council has granted express authority to make that investment either specifically or as a part of an investment program approved by the Council no less than three months prior to the investment. Reserve funds may be invested in secunt1es exceeding five years if the maturity of such investments is made to coincide as nearly as practicable with the expected use of the funds.

PERFORMANCE EVALUATION
Investment performance is continually monitored and evaluated by the City Treasurer.

Investment performance statistics and activity reports are generated on a quarterly basis for presentation to the oversight (audit) committee, City Manager and City Council. Yield on the City's investment portfolio is of secondary importance compared to the safety and liquidity objectives described above. The City 's investment portfolio shall be designed to attain a market average rate of return through economic cycles. The market average rate of return is defined as the average return on the Local Agency Investment Fund (assuming the State does not adversely affect LAIF's returns due to budget constraints) . Whenever possible, and consistent with risk limitations as defined herein and prudent investment principles , the Treasurer shall seek to augment return above the market average rate of return. 12 !,1vest111e111 Ma11age 111e111 Agree 111e111 / Revised Nove mber 2018

DELEGATION OF AUTHORITY
The Treasurer is responsible for investment management decisions and activities per City Council Resolution.

The Treasurer shall designate a staff person as a liaison/deputy in the event circumstances require timely action and the Treasurer is not present.

No officer or designee may engage in an investment transaction except as provided under terms of this policy and the procedur es by the Treasurer and approved by the City Manager/Council.

The Treasurer shall be responsible for all transactions undertaken and shall establish a system of controls to regulate the activities of subordinate officials.

If an investment adviser is retained by the City, the investment adviser , registered or exempt from registration with the Securities and Exchange Commission , must have at least five years' experience investing in the securities and obligations authorized by California Government Code 53601 subdivisions (a) to (k), inclusive, and subdivisions (m) to (q), inclusive, and with assets under management in excess of five hundred million dollars ($500,000,000) .

OVERSIGHT COMMITTEE
An audit committee consisting of appropriate internal and external members, appointed by the City Council, shall be established to provide general oversight and direction concerning the policies related to management of the City's investment pool, OPEB trust, and Pension Rate Stabilization Program trust. The City Treasurer shall serve in a staff and advisory capacity. The committee shall meet at least quarterly to review policy changes , new legislation and portfolio status.

ETHICS AND CONFLICTS OF INTEREST
Officers and employees involved in the investment process shall refrain from personal business activity that conflicts with proper execution of the investment program, or impairs their ability to make impartial investment decisions. Additionally the City Treasurer and the Deputy Treasurer are required to annually file applicable financial disclosures as required by the Fair Political Practices Commission (FPPC).

SAFEKEEPING OF SECURITIES
To protect against fraud or embezzlement or losses caused by collapse of an individual securities dealer , all securities owned by the City shall be held in safekeeping by a third party custodian acting as agent for the City under the terms of a custody agreement. All trades executed by a dealer will settle delivery versus payment (DVP) through the City's safekeeping agent. In order to verify investment holdings, an external auditor , on an annual basis , shall independently verify securities held in custody for the City . Additionally, the City Treasurer shall include a listing of 13 /11 ves1111e111 Ma11age111e11 1 Ag ree111e111 / Revised Nove 111ber 20 / 8 holdings provided by the City's custodian to the quarterly investment report as verification between annual reviews by the external auditor.

All exceptions to this safekeeping policy must be approved by the City Treasurer in written form and included in the quarterly report to City Council.

INTERNAL CONTROL
Separation of duties between the Treasurer 's function and Finance is designed to provide proper internal controls to prevent the potential for converting assets or concealing transactions . Dual transaction controls, separate and independent notifications, and reports provided by financial institutions shall be used to help implement these controls.

Wire transfers shall be approved prior to being submitted to the financial institution . Wire transfers initiated by Treasury staff must be reconfirmed by the appropriate financial institution to Finance staff. Proper documentation is required for each investment transaction and must include a broker trade confirmation and a cash disbursement wire transfer confirmation. Timely bank reconciliation is conducted to ensure proper handling of all transactions. The investment portfolio and all related transactions are reviewed and balanced to appropriate general ledger accounts by Finance staff on a monthly basis.

An annual agreed-upon procedures engagement in accordance with the attestation standards established by the American Institute of Certified Public Accountants shall be conducted by an auditor solely to assist management in determining the City' s compliance with this investment policy . At the conclusion of such engagement , the agreed-upon procedures report detailing all procedures performed and findings noted (if applicable) shall be provided to the Audit Committee of the City.

REPORTING
The City Treasurer shall prepare a quarterly investment report, including a succinct management summary that provides a clear picture of the status of the current investment portfolio. The report will be prepared in a manner that will report all information required under this policy and the California Government Code. The Treasurer will submit the report to Council no later than the second regular council meeting, or approximately 45 days following the end of the quarter covered by the report.

Following its annual or interim adoption by the City Council , this investment policy shall be remitted to the California Debt and Investment Advi sory Commission. 14 /11 vesr111e111 Mww gelllent Ag reel/lent I Revised Novelllber 20 / 8

QUALIFIED BROKER/DEALERS
Minimum eligibility criteria for dealers/brokers include a minimum of $1 billion in assets and a minimum of five years in business . The registration status of all dealers is checked with the National Association of Securities Dealer s.

Dealers are required to acknowledge the receipt and review of the Statement of Investment Policy, to be familiar with the government code restrictions, and have experience with dealing with other municipal investors. Dealers are then selected on the basis of yields, services offered, and reference s obtained. They may be primary or secondary dealers. The financial institutions must submit a current annual audited financial statement to ascertain capital adequacy.

COLLATERAL REQUIREMENTS
Collateral is required for investments in certificates of deposit and repurchase agreements. In order to reduce market risk, the collateral level will be at least 102% of market value of principal and accrued interest.

In order to conform with the provisions of the Federal Bankruptcy Code which provides for liquidation of securities held as collateral, the only securities acceptable as collateral shall be certificates of deposit , commercial paper , eligible banker's acceptances, medium term notes, or securities that are the direct obligations of, or are fully guaranteed as to principal and intere st by, the United States or any agency of the United States.

AUTHORIZED INVESTMENTS
Investment of City funds is governed by the California Government Code Sections 53600 et seq.

Within the context of the limitations, the following investments are authorized, as further limited herein :

1. United States Treasury Bills , Bonds, and Notes or those for which the full faith and credit of the United States are pledged for payment of principal and intere st. There is no percentage limitation of the portfolio that can be invested in this category, although a five-year maturity limitation is applicable.

2. Obligations issued by the Government National Mortgage Association (GNMA), the Federal Farm Credit System (FFCB), the Federal Home Loan Bank Board (FHLB), the Federal National Mortgage Association (FNMA), the Student Loan Marketing Association (SLMA), and the Federal Home Loan Mortgage Association (FHLMC).

There is no percentage limitation of the portfolio that can be invested in this category. A five-year maturity limitation is applicable.
15 /11 11esr111e11r Mww1; e111e111 A1;ree111e11r I Revised Nove 111ber 20 /8

3. Banker ' s Acceptances (bills of exchange or time drafts drawn on and accepted by commercial banks) may not exceed 180 days to maturity or 40% of the cost value of the portfolio .

4. Local Agency Investment Fund (LAIF), which is a State of California managed investment pool, may be used up to the maximum permitted by California state law.

Investment officers will review LAIF' s investment policy, investment mix, rate of return , etc. on a monthly basis . Investments detailed in items 5 through 10 are further restricted to percentage of the cost value of the portfolio in any one-issuer name to a maximum of 10%. The total value invested in any one issuer shall not exceed 5% of the issuer ' s net worth. Again, a five-year maximum maturity limitation is applicable unless further restricted by this policy.

5. Commercial paper ranked P 1 by Moody 's Investor Services or A 1 + by Standard & Poor ' s, and issued by domestic corporations having assets in excess of $500,000 ,000 and having an AA or better rating on its long-term debentures as provided by Moody 's or Standard & Poor 's. Purchases of eligible commercial paper may not exceed 270 days to maturity nor represent more than 10% of the outstanding paper of the issuing corporation .

Purchases of commercial paper may not exceed 25% of the cost value of the portfolio .

6. Negotiable Certificates of Deposits issued by nationally or state chartered banks, state or federal savings institutions, or state or federal credit unions. These institutions may use a private sector entity to assist in the placement of the certificates of deposit under the conditions specified by the Government Code . Purchases of Negotiable Certificates of Deposit may not exceed 30% of the cost value of the portfolio. A maturity limitation of five years is applicable.

7. Repurchase agreements that specify terms and conditions may be transacted with banks and broker dealers . The maturity of the repurchase agreements shall not exceed one year.

The market value of the securities used as collateral for the repurcha se agreements shall be monitored by the investment staff and shall not be allowed to fall below 102% of the value of the repurchase agreement. A PSA Master Repurchase Agreement is required between the City of Cupertino and the broker/dealer or financial institution for all repurchase agreements transacted.

8. Rever se repurchase agreements are not authorized.

9. Certificates of Deposit (time deposit s), non-negotiable and collateralized in accordance with the California Government Code , may be purchased through bank s, savings and loan association s, or credit unions. Within a limit of 30% of the cost value of the portfolio , these institutions may use a private sector entity to assist in the placement of the time deposits under the conditions specified by the Government Code.

10. Medium Term Corporate Notes issued by corporation s organized and operating in the United States with a maximum maturity of five _years may be purchased. Securitie s 16 /11 ves T//le11r Mo11 oge//le11r Agree/lie/I/ I Revised Nove/1/ber 20 /R eligible for investment shall be rated A or better by Moody's or Standard & Poor's rating services. Purchase of medium term notes may not exceed 30% of the cost value of the portfolio.

11. Bonds issued by the local agency, including bonds payable solely out of the revenues from a revenue producing property owned, controlled or operated by the local agency or by a department , board, agency, or authority of the local agency.

12. Registered state warrants or treasury notes or bonds of this state, including bonds payable solely out of the revenues from a revenue producing property owned, controlled or operated by the state or by a department, board, agency or authority of the state.

13. Bonds, notes, warrants or other evidences of indebtedness of any local agency within this state.

14. Various daily money market funds administered for or by trustees, paying agents and custodian banks contracted by the City of Cupertino may be purchased as allowed under State of California Government Code. Only funds holding U.S . Treasury obligations , Government agency obligations , or repurchase agreements collateralized by U.S.

Treasury or Government agency obligations can be utilized and may not exceed 20% of the cost value of the portfolio.

15. Ineligible investments are those that are not described herein, including but not limited to, common stocks and long-term (over five years in maturity) notes and bonds are prohibited from use in this portfolio. It is noted that special circumstances arise that necessitate the purchase of securities beyond the five-year limitation. On such occasions, requests must be approved by City Council prior to purchase.

DEPOSITS
To be eligible to receive local agency money, a bank, savings association, federal association , or federally insured industrial loan company shall have received an overall rating of not less than "satisfactory " in its most recent evaluation by the appropriate federal financial supervisorial agency of its record of meeting the credit needs of California's communities.

INTEREST EARNINGS
All moneys earned and collected from investments authorized in this policy shall be allocated monthly to various fund accounts based on the cash balance in each fund as a percentage of the entire pooled portfolio.

POLICY REVIEW
The City of Cupertino's investment policy shall be adopted by resolution of the City Council on an annual basis. This investment policy shall be reviewed at least annually to ensure its 17 !11 vest111e111 Mw wlie 111e111 Aliree111e111 I Revised Nove111ber 20 18

consistency with the overall objective s of preservation of principal , liquidity , and yield, and its relevance to current law and financial and economic trends. 18 /11 ves1111e11t Ma11 age111 e11r A1;ree111 e11t I Revi.red November 20/8

EXHIBIT C
Insurance Requirements
Financial Consultants Contracts
Financial Consultant and subcontractors , if any, shall procure and maintain until all of their obligations have been discharged , including any warranty periods under this Agreement are satisfied , insurance against claims for injury to persons or damage to property which may arise from or in connection with the perfonnance of the work hereunder by the Financial Consultant , his agents , representatives , employees or subcontractors .

The insurance requirements herein are minimum requirements for this Agreement and in no way limit the indemnity covenants contained in this Agreement. The City in no way warrants that the minimum limits contained herein are sufficient to protect the Financial Consultant from liabilities that might arise out of the perfonnance of the work under this Agreement by the Financial Consultant, his agents , representatives, employees or subcontractors and Financial Consultant is free to purchase additional insurance as may be detennined necessary.

A. MINIMUM SCOPE AND LIMITS OF INSURANCE: Financial Consultant shall provide coverage with limits of liabil ity not less than those stated below . An excess liability policy or umbrella liability policy may be used to meet the minimum liability requirements provided that the coverage is written on a "following fonn " basis .

1. Commercial General Liability - Occurrence Form
Policy shall include bodily injury , property damage and broad f01m contractual liability coverage .
• General Aggregate
• Products - Completed Operations Aggregate
• Personal and Adve11ising Injury
• Each Occunence
$4,000,000
$1,000 ,000
$1,000 ,000
$2,000,000
a. The policy shall be endorsed to include the following additional insured language: "The City shall be named as an additional insured with respect to liability arising out of the activities perfonned by, or on behalf of the Financial Consultant". b. Policy must state insurance will operate as primary insurance for work perf01med by Financial Consultant and its sub-consultants, and that any other insurance or self­ insurance main t ained by City shall be excess and non-contributory.

2. Automobile Insurance - One Million Dollars ($1 ,000,000) per accident for bodily injury and property damage.

3. Worker's Compensation and Employers' Liability
As required by the State of California, with Statutory Limits and Employer's Liability Insurance of no less than $1,000,000 per occurrence for bodily injury or disease.

D Not required. Consultant has provided written verification of no employees. a. Policy shall contain a waiver of subrogation against the City and Consultant must submit a Waiver of Subrogation endorsement in favor of City, its officers, officials, agents and employees .

Exh. C-Insurance Requirements for Finan cial Consultant Agreem ents Form Updated Dec. 2018 1 b. This requirement shall not apply when a contractor executes the appropriate sole proprietor waiver form.

4. Professional Liability (Errors and Omissions Liability) The policy shall cover professional misconduct or lack of ordinary skill for those positions defined in the Scope of Services of this contract.
• Each Claim $10,000 ,000
• Annual Aggregate $10,000 ,000
a. In the event that the professional liability insurance required by this Agreement is written on a elaim s-m-ade-1:iasis, F-inanc;.i.al CGnsu-ltant-wan:ants thaLan_y-.retroacti ve date under the policy shall precede the effective date of this Agreement; and that either continuous coverage will be maintained or an extended discovery pe1iod will be exercised for a period of two (2) years from the time work under this Agreement is completed.

5. Financial Institution Bond or Security Dealers Blanket Bond (The bond is required only if the contractor has access to City funds.)
If the Scope of Services involve receiving , depositing, transfeITing or investing City funds , one of the above bonds is required.

Bond Limit $ _____ (to be determined based on portfolio value) a. The bond shall be issued with limits based on the amount of the States investment portfolio with the contractor .
b. The bond shall include coverage for all directors, officers, agents and employees of the Contractor.
c. The bond shall include coverage for third party fidelity and name City as loss payee. d. The bond shall include coverage for extended theft and mysterious disappearance . e. If the scope of services pertains to any employee benefit plans, the bond shall include a third party ERISA endorsement.
f. The bond shall not contain a condition requiring an arrest and conviction.

B. ADDITIONAL INSURANCE REQUIREMENTS : The policies shall include, or be endorsed to include, the following provisions:

1. On insurance policies where the City is named as an additional insured , the City shall be an additional insured to the full limits of liability purchased by the Financial Consultant even if those limits of liability are in excess of those required by this Agreement.

2. The Financial Consultant's insurance coverage shall be primary insurance and non-contributory with respect to all other available sources.

C. NOTICE OF CANCELLATION: Each insurance policy required by the insurance provisions of this Contract shall provide the required coverage and shall not be suspended, voided or canceled except after thirty (30) days prior written notice has been given to the State, except when cancellation is for non­ payment of premium, then ten (10) days prior notice may be given. Such notice shall be sent directly to (City Department Representative's Name & Address).

Exh. C-Jnsurance Requirements fo r Finan cial Consultant Agreemen ts Form Updated Dec. 2018 2 D. ACCEPT ABILITY OF INSURERS: Insurance is to be placed with insurers duly licensed or authorized to do business in the City and with an "A.M. Best" rating of not less than A-VII. The City in no way wan-ants that the above-required minimum insurer rating is sufficient to protect the Contractor from potential insurer insolvency .

E. VERIFICATION OF COVERAGE: Financial Consultant shall furnish the City with certificates of insurance (ACORD form or equivalent approved by the State) as required by this Agreement. The ce1iificates for each insurance policy are to be signed by a person authorized by that insurer to bind coverage on its behalf.

All certificates and endorsements are to be received and approved by the City before work commences . Each insurance policy required by this Agreement must be in effect at or prior to commencement of work under this Agreement and remain in effect for the duration of the project.

Failure to maintain the insurance policies as required by this Agreement or to provide evidence of renewal is a material breach of contract.

All certificates and any required endorsement shall be sent directly to City Department Representative). The City project /contract number and project description shall be noted on the certificate of insurance. The City reserves the right to require complete , ce1iified copies of all insurance policies required by this Agreement at any time.

F. APPROVAL : Any modification or variation from the insurance requirements in this Agreement shall be made by the City ' s Risk Manager or City Attorney.

Exh. C-Insurance Requirements for Financial Consultant Agreements Form Updated Dec. 2018 3 Client#: 62001 CHANDAST

ACORD,M CERTIFICATE OF LIABILITY INSURANCE I DATE (MM/DDIYYYY) 10/23/2018
THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER . THIS

CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER, AND THE CERTIFICATE HOLDER.

IMPORTANT : If the certificate holder Is an ADDITIONAL INSURED, tho pollcy(les) must have ADDITIONAL INSURED prov isi ons or be endorsed.

If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy , certain policies may require an endorsement. A statement on this certificate does not confer any rights to the certificate holder in lieu of such endo rsoment(s) .

PRODUCER ~~/;lit'" Conn ie Roussel
Starkweather & Shepley _r:iaNJo, Ext): 401 435 -3600 j r~~. No): 401 431-9657 PO Box 549 ~o~AJ~ss: croussel@starshep .com
Providence, RI 02901-0549 INSURER(S) AFFORDING COVERAGE 401 435-3600
NAIC #
INSURER A : Travelers Insurance Company 25674
INSURED INSURER B : Hartford Ins Group 19682
Chandler Asset Management Inc INSURER C : Hartford Group 6225 Lusk Boulevard INSURER o : Pacific Insurance Company San Diego , CA 92121 INSURER E:

INSURER F:

COVERAGES CERTIFICATE NUMBER: REVISION NUMBER:

THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS

CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS ANO CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. !l.NSR TYPE OF INSURANCE ADDL SUBR ,:~hlg~l ( POLICY EXP LIMITS LTR (NSR WVD POLICY NUMBER MM/DDIYYYYl A X COMMERCIAL GENERAL LIABILITY y y 6802C07960542 Kl9/01 /2018 09/01/2019 EACH OCCURRENCE s2,000 ,000 - ~ CLAIMS-MADE ~ OCCUR s~~A~H 9E RENTED $1 000 000 ~- Ml · Ea occurrencol X Per Written Contract MED EXP (Any one person) s5 000 - or Agreement PERSONAL & ADV INJURY $2 000 000 -GEN'L AGGREGATE LIMIT APPLIES PER: GENERAL AGGREGATE $4,000 ,000 I~ DPRO- O Loc s4 000 ,000 POLICY JECT PRODUCTS -COMP/OP AGG OTHER: $
A AUTOMOBILE LIABILITY y y BA2C081883SEL 09/01/2018 09/01/2019 COMBINED SINGLE LIMIT $1,000,000 !Ea a.ccidentl - X ANY AUTO BODILY INJURY (Per person) $ - OWNED
~
SCHEDULED BODILY INJURY (Per accident) $
- AUTOS ONLY f-- AUTOS
X HIRED X NON-OWNED PROPERTY Ol1MAGE $ AUTOS ONL \' AUTOS ONLY (Per occident\ - -X Drive 0th Car $ A X UMBRELLA LIAB I~ OCCUR
y y CUP2C08502242 09/01/2018 09/01/2015 EACH OCCURRENCE s5 000 000 EXCESS LIAB CLAIMS-MADE AGGREGATE s5 000 000
OED I I RETENTION $ $
B WORKERS COMPENSATION y 02WECCR2756 09/01/2018 09/Q1/2019 _~ __ m1:urF I 12JH-AND EMPLOYERS' LIABILITY YIN ANY PROPRIETORIPARTNERIEXECUTIVE[m E L EACH ACCIDENT $1 000 000 OFFICER/MEMBER EXCLUDED? N NI A (Mandatory In NH) E L DISEASE -EA EMPLOYEE s1 000 ,000
~~;~~ftiri~ 'g'/OPERATIONS below E L. DISEASE - POLICY LIMIT s1 000 ,000 C Professional OODC021984518 K)8/02/2018 08/02/201 ~ 10,000,000 D Cyber Liab 08MB028799018 P8/02/2018 08/02/201 4,000,000 C Crime OOFA024546718 !08/02/2018 08/02/201 ~ 10,000 000 DESCRIPTION OF OPERATIONS/ LOCATIONS / VEHICLES (ACORD 101, Additional Remarks Schedule, may be attached If more space Is required) The City of Cupertino, it's officers, employees, agents and volunteers are additional insured on a primary and non-contributory basis as required by written contract or agreement. A waiver of subrogation also applies to the additional insured as required by written contract or agreement.

CERTIFICATE HOLDER CANCELLATION
City of Cupertino

SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE

THE EXPIRATION DA TE THEREOF, NOTICE WILL BE DELIVERED IN Attn: Kristina Alfredo or Zach Korach ACCORDANCE WITH THE POLICY PROVISIONS. 10300 Torre Avenue
Cupertino , CA 95014 AUTHORIZED REPRESENTATIVE
I <4~
© 1988-2015 ACORD CORPORATION . All rights reserved .

ACORD 25 (2016103) 1 of 1
#S1206819/M1167005
The ACORD name and logo are registered marks of ACORD
CTR

COMMERCIAL AUTO
THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY.

AUTO COVERAGE PLUS ENDORSEMENT
This endorsement modifies Insurance provided under the following:

BUSINESS AUTO COVERAGE FORM
GENERAL DESCRIPTION OF COVERAGE -This endorsement broadens coverage. However, coverage for any injury, damage or medical expenses described in any of the provisions of this endorsement may be excluded or limited by al'!ether ene0fsement - to-the-G0verage-~art, and-tl:lese coverage broadening prnvisionS-d0-noLappl.y-to the extent that coverage is excluded or limited by such an endorsement. The following listing is a general cover­ age description only. Limitations and exclusions may apply to these coverages. Read all the provisions of this en­ dorsement and the rest of your policy carefully to determine rights, duties, and what is and is not covered.

A. BLANKET ADDITIONAL INSURED
B. EMPLOYEE HIRED AUTO
C. EMPLOYEES AS INSURED
D. SUPPLEMENTARY PAYMENTS - INCREASED
LIMITS
E. TRAILERS - INCREASED LOAD CAPACITY
F. HIRED AUTO PHYSICAL DAMAGE
G. PHYSICAL DAMAGE - TRANSPORTATION

EXPENSES - INCREASED LIMIT
A. BLANKET ADDITIONAL INSURED
The following is added to Paragraph A.1., Who Is
An Insured, of SECTION II - COVERED AUTOS
LIABILITY COVERAGE:

Any person or organization who Is required under
a written contract or agreement between you and
that person or organization, that is signed and
executed by ·you before the "bodily injury" or
"property damage" occurs and that is In effect
during the policy period, to be named as an addi­
tional insured is an "insured" for Covered Autos
Liability Coverage, but only for damages to which
this insurance applies and only to the extent that
person or organization qualifies as an "insured"
under the Who Is An Insured provision contained
in Section II.

B. EMPLOYEE HIRED AUTO

1. The following is added to Paragraph A. 1.,
Who Is An Insured, of SECTION II - COV­
ERED AUTOS LIABILITY COVERAGE:

An "employee" of yours is an "Insured" while
operating a covered "auto" hired or rented
under a contract or agreement in an "em­
ployee's" name, with your permission, while
H. AUDIO, VISUAL AND DATA ELECTRONIC

EQUIPMENT - INCREASED LIMIT
I. WAIVER OF DEDUCTIBLE - GLASS
J. PERSONAL PROPERTY
K. AIRBAGS
L. AUTO LOAN LEASE GAP
M. BLANKET WAIVER OF SUBROGATION
performing duties related to the conduct of
your business.

2. The following replaces Paragraph b. in B.5.,
Other Insurance, of SECTION IV - BUSI~
NESS AUTO CONDITIONS:
b. For Hired Auto Physical Damage Cover­
age, the following are deemed to be cov­
ered "autos" you own:
(1) Any covered "auto" you lease, hire,
rent or borrow; and
(2) Any covered "auto" hired or rented by
your "employee" under a contract in
an "employee's" name, with your
permission, while performing duties
related to the conduct of your busi­
ness.

However, any "auto" that is leased, hired,
rented or borrowed with a driver is not a
covered "auto".

C. EMPLOYEES AS INSURED
The following is added to Paragraph A.1., Who Is
An Insured, of SECTION II - COVERED AUTOS
LIABILITY COVERAGE:

CA T4 20 02 15 <l:l 2015 The Travelers Indemnity Company . All rights reserved Page 1 of 3 Includes copyrighted materiel of Insurance Ser.'lces Ofnce, Inc. with its permission OO~Q7T

COMMERCIAL AUTO
Any "employee" of yours Is an "insured" while us­
ing a covered "auto" you don't own, hire or borrow
In your business or your personal affairs.

D. SUPPLEMENTARY PAYMENTS - INCREASED
LIMITS

1. The following replaces Paragraph A.2.a.(2) of

SECTION II - COVERED AUTOS LIABILITY
COVERAGE:
(2) Up to $3,000 for cost of bail bonds (In­
cluding bonds for related traffic law viola­
tions) required because of an ~accident"
we cover. We do not have to furnish
these bonds.

2. The following replaces Paragraph A.2.a.(4) of

SECTION II - COVERED AUTOS LIABILITY
COVERAGE:
(4) All reasonable expenses incurred by the
"Insured" at our request, Including actual
loss of earnings up to $500 a day be­
cause of time off from work.

E. TRAILERS - INCREASED LOAD CAPACITY
The following replaces Paragraph C.1. of SEC­
TION I - COVERED AUTOS:

1. "Trailers" wilh a load capacity of 3,000
pounds or less designed primarily ror travel
on public roads.

F. HIRED AUTO PHYSICAL DAMAGE
The following Is added to Paragraph A.4., Cover­
age Extensions, of SECTION Ill - PHYSICAL
DAMAGE COVERAGE:

Hired Auto Physical Damage Coverage
If hired "autos" are covered "autos" for Covered
Autos Liability Coverage but not covered "autos"
for Physical Damage Coverage, and this policy
also provides Physical Damage Coverage for an
owned "auto", then the Physical Damage Cover­
age is extended to "autos" that you hire, rent or
borrow subject to the following:
(1) The most we will pay for "loss" to any one
"auto" that you hire, rent or borrow is the
lesser of:
(a) $50,000;
(b) The actual cash value ot the damaged or
s1olen property as of the time of the
"loss"; or
(c) The cost of repairing or replacing the
damaged or stolen property with other
property of like kind and quality.
(2) An adjustment for depreciation and physlcal
condition will be made in determining actual
cash value In the event of a total "loss".
(3) If a repair or replacement results in better
than like kind or quality, we will not pay for the
amount of betterment.
(4) A deductible equal to the highest Physical
Damage deductible applicable to any owned
covered "auto".
(5) This Coverage Extension does not apply to:
(a) Any "auto" that is hired, rented or bor­
rowed with a driver; or
(b) Any "auto" that is hired, rented or bor­
rowed from your "employee".

G. PHYSICAL DAMAGE - TRANSPORTATION

EXPENSES - INCREASED LIMIT
The followlng replaces the first sentence in Para­
graph A.4.a., Transportation Expenses, of
SECTION Ill - PHYSICAL DAMAGE COVER­
AGE:

We will pay up to $50 per day lo a maximum of
$1,500 for temporary transportation expense In­
curred by you because of the total theft of a cov­
ered "auto" of the private passenger type.

H. AUDIO, VISUAL AND DATA ELECTRONIC

EQUIPMENT - INCREASED LIMIT
Paragraph C.1.b. of SECTION Ill - PHYSICAL
OAMAGE COVERAGE is deleted,
I. WAIVER OF DEDUCTIBLE - GLASS
The following is added to Paragraph D., Deducti­
ble, of SECTION Ill - PHYSICAL DAMAGE
COVERAGE:

No deductible for a covered "auto'' will apply to
glass damage if the glass Is repaired rather than
replaced.

J, PERSONAL PROPERTY
The following Is added to Paragraph A.4., Cover­
age Extensions, of SECTION Ill - PHYSICAL
OAMAGE COVERAGE:

Personal Property Coverage
We will pay up to $400 for "loss" to wearing ap­
parel and other personal property which Is:
(1) Owned by an "insured": and
(2) In or on your covered "auto" .

This coverage only applies In the event of a total
theft of your covered ''auto".

No deductibles apply to Personal Property cover­
age.

Includes copyrighled material ot Insurance Services Orfice, Inc. with Its permission .

COMMERCIAL AUTO
K. AIRBAGS (2) Any:

The following is added to Paragraph 8.3., Exclu- (a) Overdue lease or loan payments at the sions, of SECTION Ill - PHYSICAL DAMAGE time of the "loss"; COVERAGE: (b) Financial penalties imposed under a
Exclusion 3.a. does not apply to "loss" to one or lease for excessive use, abnonnal wear more airbags in a covered "auto" you own that In- and tear or high mileage; flate due to a cause other than a cause of "loss"
set forth In Paragraphs A.1.b. and A.1.c., but (c) Security deposits not returned by the les- only: so~
a. If that "auto" is a covered "auto" for Compre- (d) Costs for extended warranties, Credit Life --henslve-eover-a@e tJnflef-thls-11olley-;---; _________ :ln_s_urJin_CJl,__J-i_e_altb, AcJ::lcle_aLOLO.is.abilUy~ b. The airbags are not covered under any war- Insurance purchased with the loan or ranty; and lease; and
c. The airbags were not Intentionally inflated. (e) Carry-over balances from previous loans or leases.

We will pay up to a maximum of $1,000 for any one "loss". M. BLANKET WAIVER OF SUBROGATION L. AUTO LOAN LEASE GAP The following replaces Paragraph A.5., Transfer The following Is added to Paragraph A.4., Cover- Of Rights Of Recovery Against Others To Us, age Extensions, of SECTION 111 _ PHYSICAL of SECTION IV - BUSINESS AUTO CONDI- DAMAGE COVERAGE: TIONS:

Auto Loan Lease Gap coverage for Private 5. Transfer Of Rights Of Recovery Against Passenger Type Vehicles Others To Us
In the event of a total "loss" to a covered "auto" of We waive any right of recovery we may have the private passenger type shown In the Schedule against any person or organization to the ex- or Declarations for which Physlcal Damage Cov- tent required of you by a written contract exe· erage is provide<!, we will pay any unpaid amount cuted prior to any "accident" or "loss", pro- due on the lease or loan tor such covered "auto" vlded that the "accident" or "loss" arises out of less the following: the operations contemplated by such con- (1) The amount paid under the Physical Damage tract. The waiver applies only to the person or Coverage Section of the policy for that "auto•; organization designated In such contract . . and
CAT4200216 il:J 2015 The Travelers Indemnity Company. All rights reserved . Page 3 of 3 Includes copyrighted material or Insurance Services Office, Inc. with Its permission .

COMMERCI AL GENER AL LIABILIT Y
THIS ENDORSEMENT CHANGES THE POLI C Y. PLEAS E REA D IT CAREFULLY.

BLANKET ADDITIONAL INSURED - OWN ERS, LESSE ES

OR CONTRACTOR S
This endorsement modifies insurance provided under the following:

COMMERGI.AL GFNERAL LIABILITY COVERAGE PART
PROVISIONS:

1. WHO IS AN INSURED (SECTION II) is amended
to include as an insured any person or organiza-
tion (called hereafter "additional i nsured") whom
you have agreed in a written contract, executed
prior to loss. to name as additional insured, but
only wlth respect to liability arising out of "your
work" or your ongoing operations for that addi­
tional insured performed by you or for you.

2. With respect to the Insurance afforded to Addi ­
tional Insureds the following conditions apply:
a. Limits of Insurance - The following limits of
llablllty apply:

1. The limits which you agreed to provide;
or
· - 2. The limits shown on the declarations,
whichever Is less.
b. This Insurance Is excess over any valld and
collectible Insurance unless you have agre ed
in a written contract for this Insurance to
apply on a primary or contributory basis.

3. This insurance does not apply :
a. on any basis to any person or organization
for whom you have purchased an Owners
and Contractors Protective policy .
b. to "bodily Injury,'' "property damage ," "per­
sonal Injury,'' or "advertising Injury" arising
out of the rendering of or the failure to render
any professional services by or for you, In­
cluding:

1. The preparing, approving or falling to
prepare or approve maps, drawings,
opinions, reports, surveys , change or­
ders, designs or specifications; and

2. Supervisory, inspection or engineering
services.

CG 0 1 05 04 94 Copyright . The Travel ers Indemnit y Compan y, 1994. Page 1 of 1 Includes Copyrighte d Material from Insuranc e Services Office , Inc. -
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006924

COMMERCIAL GENERAL LIABILITY
THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY.

XTEND ENDORSEMENT
This endorsement modifies insurance provided under the following:

COMMERCIAL GENERAL LIABILITY COVERAGE PART
GENERAL DESCRIPTION OF COVERAGE- This endorsement broadens coverage. The following listing Is a ger:ier a I cov-e mg e-d escri pt ion-onJy.-Lim ita tinns__ao d_excl usLon_s_rna y_JJ. pply_to__tbfrs~e_co~r:ag _e_:i._flirnd_al I the PR 0- V IS IONS of this endorsement carefully to determine rights, duties, and what is and is not covered.

A. Broadened Named Insured

8. Damage To Premises Rented To You Extension
• Perils of Fire, explosion, lightning, smoke, water
• Limit increased to $300,000
c. Blanket Waiver of Subrogation
D. Blanket Additional Insured- Managers or
Lessors of Premises
E. Blanket Additional Insured - Lessor of
leased Equipment
F. Incidental Medical Malpractice
G. Personal Injury - Assumed by Contract
H. Extension of Coverage - Bodily Injury

PROVISIONS
A. BROADENED NAMED INSURED

1. The Named Insured In Item 1. of the Declara­
tions is as follows:

The person or organization named in Item 1.
of the Declarations and any organization,
other than a partnership or joint venture, over
which you maintain ownership or majority in­
terest on the effective date of the policy.

However, coverage for any such organization
will cease as of the date during the policy pe­
riod that you no longer maintain ownership of,
or majority interest in , such organization.

2. WHO IS AN INSURED (Section IQ llem 4.a .
is deleted and replaced by the following :
a. coverage under this provision Is afforded
only until the 180th day after you acquire
or form the organization or the end of the
policy period, whichever Is earlier, unless
reported in writing to us within 180 days.

3. This Provision A. does not apply lo any per­
son or organization for which coverage is ex­
cluded by endorsement.

I. Injury to Co-Employees and Co-Volunteer
Workers
J. Aircraft Chartered with Crew
K. Non-Owned Watercraft - Increased
from 25 feet to 50 feel
L. Increased Supplementary Payments
• Cost for bail bonds increased to $2,500
• Loss of earnings increased to $500 per day
M. Knowledge and Notice of Occurrence
or Offense
N. Unintentional Omission

0. Reasonable Force - Bodily Injury or
Property Damage
B. DAMAGE TO PREMISES RENTED TO YOU

EXTENSION

1. The last paragraph of COVERAGE A. BOD­
ILY INJURY AND PROPERTY DAMAGE LI­
ABILITY (Section I - Coverages) Is deleted
and replaced by the following:

Exclusions c. through n. do not apply to dam­
age lo premises while rented to you, or tem­
porarily occupied by you with permission of
the owner, caused by:
a. Fire;
b. Explosion;
c. Lightning;
d. Smoke resulting from such fire, explosion,
or lightning; or
e. Waler .

A separate llm ll of insurance applies to this
coverage as described in LIMITS OF INSUR­
ANCE (Section II~.

2. This Insurance does not apply to damage to
premises while rented to you, or temporarily
CG 01 86 11 03 Copyright, The Travelers Indemnity Company, 2003 Page 1 of 5

COMMERCIAL GENERAL LIABILITY
occupied by you with permission of the
owner, caused by:
a. Rupture, bursting, or operation of pres­
sure relief devices:
b. Rupture or bursting due to expansion or
swelling of the contents of any building or
structure, caused by or resulting from wa­
ter;
c. Explosion of steam boilers, steam pipes,
steam engines, or steam turbines .

3. Part 6. of LIMITS OF INSURANCE (Section
II~ is deleted and replaced by the following:

Subject to 5. above, the Damage To Prem­
ises Rented To You Limit is the most we will
pay under COVERAGE A. for damages be­
cause of "property damage" to any one prem­
ises while rented to you, or temporarily occu­
pied by you with permission of the owner,
caused by fire, explosion, lightning, smoke
resulting from such fire, explosion, or light­
ning, or water. The Damage To Premises
Rented To You Limit will apply to all damage
proximately caused by the same "occur­
rence", whether such damage results from
fire, explosion, lightning, smoke resulting from
such fire, explosion, or lightning, or water , or
any combination of any of these.

The Damage To Premises Rented To You
Limit will be the higher of:
a. $300,000; or
b. The amount shown on the Declarations
for Damage To Premises Rented To You
Limit.

4. Under DEFINITIONS (Section V), Paragraph
a. of the definition of "insured contract" is
amended so that it does not include that por­
tion of the contract for a lease of premises
that indemnifies any person or organizatlo n
for damage to premises while rented to you,
or temporarily occupied by you with permis­
sion of the owner, caused by:
a. Fire;
b. Explosion;
c. Lightning;
d. Smoke resu lting from such fire, explosion,
or lightning; or
e. Water .

5. This Provision B. does not apply if coverage
for Damage To Premises Rented To You of

COVERAGE A BODILY INJURY AND
PROPERTY DAMAGE LIABILITY (Section I -
Coverages) is excluded by endorsement.

C. BLANKET WAIVER OFSUBROGATION
We waive any right of recovery we may have
against any person or organization because of
payments we make for injury or damage arising
out of premises owned or occupied by or rented
or loaned to you; ongoing operations performed
by you or on your behalf, done under a contract
with that person or organization; "your work"; or
"your products". We waive \his right where you
have agreed to do so as part of a written contract,
executed by you prior to loss.

D. BLANKET ADDITIONAL INSURED - MANAG­

ERS OR LESSORS OF PREMISES
WHO IS AN INSURED (Section 10 is amended to
include as an insured any person or organization
(referred to below as "additional insured") with
whom you have agreed in a written contract, exe­
cuted prior to loss, to name as an additional in­
sured, but only with respect to liability arising out
or the ownership, maintenance or use of that part
of any premises leased to you, subject to the fol­
lowing provisions:

1. Limits of Insurance. The limits of insurance
afforded to the additional Insured shall be the
limits which you agreed to provide, or the lim­
its shown on the Declarations, whichever is
less.

2. The Insurance afforded to the additional In­
sured does not apply to:
a. Any "occurrence" that takes place after
you cease to be a tenant in that premises;
b. Any premises for which coverage Is ex­
cluded by endorsement; or
c. Structural alterations, new construction or
demolition operations performed by or on
behalf of such additional insured.

3. The insurance afforded to the additional in­
sured Is excess over any valid and collectible
insurance available to such additional in­
sured, unless you have agreed In a written
conlract for this insurance to apply on a pri­
mary or contributory basis.

E. BLANKET ADDITIONAL INSURED - LESSOR

OF LEASED EQUIPMENT
WHO IS AN INSURED (Section IQ is amended to
include as an insured any person or organization
(referred to below as "additional insured") with
Page2of5 Copyright , The Trav el ers Indemnity Company , 2003 CG D1 86 11 03 = o=
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COMMERCIAL GENERAL LIABILITY
whom you have agreed in a written contract, exe- for which no remuneration is demanded cuted prior lo loss, to name as an additional in- or received . sured, but only with respect to their liability arising 3. Paragraph 2.a.(1 )(d) of WHO IS AN IN- out of the maintenance, operation or use by you SURED (Section IQ does not apply to any of equipment leased to you by such additional in- registered nurse, licensed practical nurse, sured, subject to the following provisions: emergency medical technician or paramedic

1. Limits of Insurance. The limits of insurance employed by you, but only while performing afforded to the additional insured shall be the the services described In paragraph 2. above limits which you agreed to provide, or the lim- and while acting within the scope of their em- Its shown on the Declarations, whichever is ployment by you. Any "employees" rendering less. --- -------- ~ ·sood - Sarnarit-an services'' wlll- be- de·emed- t·o-

2. The insurance afforded to the additional in- be acting within the scope of their employ- sured does not apply to: rnent by you.
a. Any "occurrence" that takes place after 4. The following exclusion is added to paragraph

2. Exclusions of COVERAGE A. - BODILY
the equipment lease expires; or INJURY AND PROPERTY DAMAGE LIABIL- b. "Bodily injury" or "property damage" aris- ITY (Section 1- Coverages):
ing out of the sole negligence of such ad- (This insurance does not apply to:) Liability ditional insured . arising out of the willful violation of a penal J. The Insurance afforded lo the additional in- statute or ordinance relating to the sale of sured is excess over any valid and collectible pharmaceuticals by or with the knowledge or insurance available to such additional in- consent of the Insured. sured, unless you have agreed in a written 5. For the purposes of determining the applica- contract for this Insurance to apply on a pri- ble limits of insurance, any act or omission, mary or contributory basis. together with all related acts or omissions In F. INCIDENTAL MEDICAL MALPRACTICE the furnishing or the services described in

1. The definition of "bodily injury" in DEFINI- paragraph 2. above to any one person, will be TIONS (Section V) is amended to include "In- considered one ''occurrence". cidental Medical Malpractice Injury". 6. This Provision F. does not apply if you are in

2. The following definition is added to DEFINI- the business or occupation of providing any of TIONS (Section V): the services described in paragraph 2. above. "Incidental medical malpractice Injury" means 7. The Insurance provided by this Provision F. bodily injury, mental anguish, sickness or dis- shall be excess over any other valid and col- ease sustained by a person, including death lectible insurance available to the insured, resulting from any of these at any lime, aris- whether primary, excess, contingent or on ing out of the rendering of, or failure to ren- any other basis, excepl for Insurance pur- der, the following services: chased specifically by you to be excess of this policy.
a. Medical , surgical , dental, laboratory, x-ray G, PERSONAL INJURY _ ASSUMED BY CON- or nursing service or treatment, advice or
instruction. or the related furnishing of TRACT
food or beverages; 1. The Contractual Liability Exclusion in Part

2., Exclusions of COVERAGE B. PER-
b. The furnishing or dispensing or drugs or SONAL AND ADVERTISING INJURY LIABIL- medical, dental, or surgical supplies or
appliances: or ITY (Section I - Coverages) is deleted and replaced by the following:
c. First aid. (This insurance does not apply to:)
d. "Good Samar itan services" . As used in Contractual Liability this Provision F., "Good Samaritan ser- vices" are those medical services ren- "Advertising injury" for which the insured has dered or provided in an emergency and assumed liability in a contract or agreement .

This exclusion does not apply to liability for
CG 01 86 11 03 Copyright, The Travelers Indemnity Company , 2003 Page 3 of 5

COMMERCIAL GENERAL LIABILITY
damages that the insured would have in the
absence of the contract or agreement.

2. Subparagraph f, of the definition of "insured
contract" (DEFINITIONS - Section V) is de­
leted and replaced by the following:
f. That part of any other contract or agree­
ment periaining lo your business (includ­
ing an indemnification of a municipality in
connection with work performed for a
municipality) under which you assume the
tort liability of another par1y to pay for
"bodily injury," "property darn age" or "per­
sonal injury" lo a third party or organiza­
tion . Ton liability means a liability that
would be Imposed by law in the absence
of any contract or agreement.

3. Tllis Provision G. does not apply if COVER­
AGE 8. PERSONAL AND ADVERTISING IN­
JURY LIABILITY is excluded by endorse­
ment .

H. EXTENSION OF COVERAGE - BODILY IN­
JURY
The definition of "bodily injury" (DEFINITIONS -
Section V) is deleted and replaced by the follow­
ing :
"Bodily injury" means bodily injury, mental an­
guish, mental injury, shock , fright, disability , hu­
miliation, sickness or disease sustained by a per­
son, including death resulting from any of these at
any time .

I. INJURY TO CO-EMPLOYEES AND CO-

VOLUNTEER WORKERS

1. Your "employees" are insureds with respect
to "bodily injury" to a co-"employee" in the
course of lhe co-"employee's" employment by
you, or to your "volunteer workers" while per­
forming duties related to the conduct of your
business, provided that th is coverage for your
"employees" does not apply to acts outside
the scope of their employment by you or while
performing duties unrelated to the conduct of
your business.

2. Your ''volunteer workers" are insureds with
respect to "bodily Injury" to a co-"volunteer
worker" while performing duties related to the
conduct of your business, or to your "employ­
ees" In the course or the "employee's" em­
ployment by you, provided that this coverage
for your "volunteer workers" does not apply
while performing duties unrelated to the con­
duct of your business.

3. Subparagraphs 2.a .(1 )(a), (b) and (c) and

3.a. of WHO IS AN INSURED (Section II) do
not apply to "bodily injury" for which Insurance
is provided by paragraph 1. or 2. above.

J. AIRCRAFT CHARTERED WITH CREW

1. The following Is added to the exceptions con­
tained in the Aircraft, Auto Or Watercraft
Exclusion in Part 2., Exclusions of COVER­

AGE A BODILY INJURY AND PROPERTY
DAMAGE LIABILITY (Section 1- Coverages) :
(This exclusion does not apply to:) Aircraft
chartered with crew to any insured .

2. This Provision J. does not apply If the char­
tered aircraft is owned by any Insured.

3. The insurance provided by this Provision J.
shall be excess over any other valid and col­
lectible Insurance available to the Insured,
whether primary, excess, contingent or on
any other basis, except for insurance pur­
chased specifically by you to be excess or
this policy.

K. NON-OWNED WATERCRAFT

1. The exception contained In Subparagraph (2)
of the Aircraft, Auto Or Watercraft Exclu­
sion in Part 2., Exclusions of COVERAGE A.

BODILY INJURY AND PROPERTY DAMAGE
LIABILITY (Section I - Coverages) Is deleted
and replaced by the following:
(2) A watercraft you do not own that Is:
(a) Fifty feet long or less; and
(b) Not being used to carry persons or
property for a charge;

2. This Provision K. applies to any person who,
with your expressed or implied consent, either
uses or is responsible for the use of a water­
craft .

3. The Insurance provided by this Provision K.
shall be excess over any other valid and col­
lectible Insurance available to the insured,
whether primary, excess, contingent or on
any other basis, except for Insurance pur­
chased specifically by you to be excess or
this policy.

L. INCREASED SUPPLEMENTARY PAYMENTS
Parts b. and d. of SUPPLEMENTARY PAY­
MENTS - COVERAGES A AND B (Section I -
Coverages) are amended as follows :

1. In Part b. the amount we will pay for the cost
of bail bonds Is increased to $2500 .

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006926

2. In Part d. the amount we will pay for loss of
earnings is increased to $500 a day.

M. KNOWLEDGE AND NOTICE OF OCCUR­

RENCE OR OFFENSE

1. The following is added to COMMERCIAL
GENERAL LIABILITY CONDITIONS (Section
IV), paragraph 2. (Duties In The Event of Oc­
currence, Offense, Claim or Suit):

Notice of an "occurrence" or of an offense
wt:ilch may rnsull in a claim under this Insur­
ance shall be given as soon as practicable af­
ter knowledge of the "occurrence'' or offense
has been reported to any insured listed under
Paragraph 1. of Section II - Who Is An In­
sured or an "employee" (such as an Insur­
ance, loss control or risk manager or adminis­
trator) designated by you to give such notice.

Knowledge by other "employee(s)" of an "oc­
currence" or of an offense does not imply that
you also have such knowledge .

2. Notice shall be deemed prompt If given In
good faith as soon as practicable to your
workers' compensation insurer. This applies
only if you subsequently give notice to us as
soon as practicable after any insured listed
under Paragraph 1. of Section II - Who Is An
Insured or an "employee" (such as an insur­
ance, loss control or risk manager or adminis­
trator) designated by you lo give such notice
discovers that the "occurrence", offense or
claim may involve this policy .

3. However, this Provision M. does not apply as
respects the specific number of days within

COMMERCIAL GENERAL LIABILITY
which you are required to notify us in writing
of the abrupt commencement of a discharge,
release or escape of "pollutants" which
causes "bodily injury" or "property damage"
which may otherwise be covered under this
policy.

N. UNINTENTIONAL OMISSION
The following is added to COMMERCIAL GEN­
ERAL LIABILITY CONDITIONS (Section IV),
paragraph 6. (Representations):

The unintentional omission of, or unintentional
error In. any information provided by you shall not
prejudice your rights under this insurance. How­
ever, this Provision N. does not affect our right to
collect additional premium or to exercise our right
of cancellation or nonrenewal in accordance with
applicable state insurance laws, codes or regula­
tions.

0. REASONABLE FORCE - BODILY INJURY OR

PROPERTY DAMAGE
The Expected Or Intended Injury Exclusion in
Part 2., Exclusions of COVERAGE A. BODILY

INJURY AND PROPERTY DAMAGE LIABILITY
(Section I - Coverages) is deleted and replaced
by the followlng:
(This Insurance does not apply to:)
Expected or Intended Injury or Damage
"Bodily Injury" or "property damage" expected or
intended from the standpoint of the insured. This
exclusion does not apply to "bodily Injury" or
"property damage" resulting from the use of rea­
sonable force to protect persons or property.

CG D1 86 11 03 Copyright . The Travelers Indemnity Company, 2003 Page 5 of 5 -o-
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006923

COMMERCIAL GENERAL LIABILITY
THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY.

OTHER INSURANCE - ADDITIONAL INSUREDS
This endorsement modifies insurance provided under the following:

COMMERCIAL GENERAL LIABILITY COVERAGE PART

PROVISIONS

COMMERCIAL GENERAL LIABILITY CONDITIONS
(Section IV), Paragraph 4. (Other Insurance), Is
amended as follows:

1. The following is added to Paragraph a. Primary
Insurance:

However, if you specifically agree in a written con·
tract or written agreement that the Insurance pro­
vided to an additional i nsured under this
Coverage Part must apply Ofl a primary basis, or
a primary and non-contributory basis, this Insur-
. ance is primary to otner insurance that is avail­
able to such additional insured which covers such
additional Insured as a named Insured, and we
will not share with that other insurance, provided
that:
a. The "bodily Injury" or "pr operty damage" for
which coverage is sought occurs: and
b. The "personal injury" or "advertising injury" for
which coverage is sought arises out of an of­
fense committed
subsequent to the signing and execution of that
contract or agreement by you.

2. The first Subparagraph (2) of Paragraph b. Ex­
cess Insurance regarding any other primary In­
surance available to you is deleted .

3. The following is added to Paragraph b. Excess
Insurance, as an additional subparagraph under
Subparagraph (1 ):

Thal is available to the insured when the Insured
is added as an additional Insured under any other
policy, Including any umbrella or excess policy.

CG DO 37 04 05 Copyright 2005 The St. Paul Travelers Companies, Inc. All rights reserved. Page 1 of 1 Ii
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COMMON POLICY CONDITIONS
All Coverage Parts included in this policy are subject to the following conditions:

A. CANCELLATION C. EXAMINATION OF YOUR BOOKS AND

1. The first Named Insured shown in the Decla- RECORDS
rations may cancel this policy by mailing or We may examine and audit your books and re- delivering to us advance written notice of cords as they relate to this policy at any time dur- cancellation. ------ ~ i 9,--1ruLpoJicy_period and up_lo_t!Jree y_eats_aflaf::__

2. We may cancel this policy or any Coverage ward.

Part by mailing or delivering to the first D. INSPECTIONS AND SURVEYS Named Insured written notice of cancellation 1. we have the right to:
at least:
a. Make inspections and surveys at any a. 10 days before the effective date of can- time; cellation if we cancel for nonpayment of
premium; or b. Give you reports on the conditions we
find; and b. 30 days before the effective date of can-
cellation if we cancel for any other rea- c. Recommend changes. son. 2. We are not obligated to make any inspec-

3. We will mail or deliver our notice to the first tions, surveys. reports or recommendations Named lnsured's last mailing address known and any such actions we do undertake relate to us. only to lnsurability and the premiums to be
charged. We do not make safety inspections.

4. Notice of cancellation will state the effective we do not undertake to perform the duty of date of cancellation. If the policy is cancelled, any person or organization to provide for the that date will become the end of the policy health or safety of workers or the public. And period. If a Coverage Part is cancelled, that we do not warrant that conditions:
date will become the end of the policy period
as respects that Coverage Part only. a. Are safe or healthful; or

5. If this policy or any coverage Part is can- b. Comply with laws, regulations, codes or celled, we will send the first Named Insured standards. any premium refund due. If we cancel, the re- 3. Paragraphs 1. and 2. of this condition apply fund will be pro rata. If the first Named In- not only to us, but also to any rating, advl- sured cancels, the refund may be less than sory, rate service or similar organization pro rata. The cancellation will be effective which makes insurance inspections, surveys, even If we have not made or offered a re- reports or recommendations. fund. 4. Paragraph 2. of this condition does not apply

6. If notice is mailed, proof of mailing will be to any inspections, surveys, reports or rec- sufficient proof of notice. ommendations we may make relative to certl- B. CHANGES fication, under state or municipal statutes, or- dinances or regulations. of boilers, pressure
This policy contains all the agreements between vessels or elevators. you and us concerning the insurance afforded.

The first Named Insured shown in the Declara- E. PREMIUMS lions is authorized to make changes in the terms 1. The first Named Insured shown in the Decla- of this policy with our consent. This policy's terms rations:
can be amended or waived only by endorsement a. Is responsible for the payment of all pre- issued by us as part of this policy. miums: and
b. Will be the payee for any return premi­
ums we pay.

IL TJ 15 09 07 (Rev. 03-11 ) Includes the copyrighted material of Insurance Services Office , Inc . with Its permission . Page 1 of 2

2. We compute all premiums for this policy in
accordance with our rules, rates, rating plans,
premiums and minimum premiums . The pre­
mium shown in the Declarations was com­
puted based on rates and rules in effect at
the time the policy was issued. On each re­
newal, continuation or anniversary of the ef­
fective date of this policy, we will compute
the premium in accordance with our rates
and rules then In effect.

F. TRANSFER OF YOUR RIGHTS AND DUTIES

UNDER THIS POLICY
Your rights and duties under this policy may not
be transferred without our written consent except
in the case of death of an individual named in­
sured.

If you die, your rights and duties will be trans­
ferred to your legal representative but only while
acting within the scope of duties as your legal
representative. Until your legal representative is
appointed, anyone having proper temporary cus­
tody of your property will have your rights and
duties but only with respect to that property.

G. BUSINESSOWNERS COVERAGE PART
REFERENCES TO FORMS AND ENDORSE­
MENTS
In some instances, the Common Policy Declara­
tions may list endorsements included in the Busi­
nessowners Coverage Part that reference:

1. The Commercial Property Coverage Part:

2. The Commercial General Liability or Liquor
Liability Coverage Part; or

3. Standard Property forms including, but not
limited to, the following:
a. Building and Personal Property Coverage
Form;
b. Business Income Coverage Form;
c. Commercial Property Conditions;
d. Condominium Association Coverage
Form:
e. Condominium Commercial Unit-Owners
Coverage Form;
f. Causes of Loss Basic Form;
g. Causes of Loss Special Form; and
h. Causes of Loss Earthquake Form.

Endorsements referencing the Commercial
Property Coverage Part or the Standard
Property Forms referenced above apply to
the Businessowners Property Coverage Spe­
cial Form in the same manner as they apply
to the forms they reference.

Endorsements referencing the Commercial
General Liability Coverage Part apply to the
Commercial General Liability Coverage Form
(included In the Businessowners Coverage
Part) In the same manner as they apply to the
form they reference.

H. INSURANCE UNDER lWO OR MORE COVER­

AGE PARTS
If two or more of this policy's Coverage Parts ap­
ply to the same loss or damage , we will not pay
more than the actual amount of the loss or dam-
age.

This policy consists of the Common Policy Declarations and the Coverage Parts and endorsements listed in that declarations form.

In return for payment of the premium, we agree with the Named Insured to provide the insurance afforded by a Coverage Part forming part of this policy . That insurance will be provided by the company indicated as insuring company in the Common Policy Declarations by the abbreviation of its name opposite that Coverage Part.

One of the companies listed below (each a stock company) has executed this policy, and this policy is counter­ signed by the officers listed below:

The Travelers Indemnity Company (IND)
The Phoenix Insurance Company (PHX)
The Charter Oak Fire Insurance Company (COF)
Travelers Property Casualty Company of America (TIL)
The Travelers Indemnity Company of Connecticut (TCT)
The Travelers Indemnity Company of America (TIA)
Travelers Casualty Insurance Company of America (ACJ)
tJ~f.~
Secretary President

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012026

UMBRELLA
THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY.

WAIVER OF OUR RIGHT TO RECOVER FROM OTHERS
This endorsement modifies insurance provided under the following:

COMMERCIAL EXCESS LIABILITY (UMBRELLA) INSURANCE
The following is added to Paragraph i, .. OUR RIGHT a. "Bodily injury" or "property damage" caused by an TO RECOVER FROM 0TH ERS., of SECT_IO_ N_I_V_-____ "_oc_c_u_r_re_n_c_e_" _th_a_t _ta_k_e_s~ la_c_e~; _o_r ______ _ CONDITIONS.: b. "Personal injury" or "advertising injury" caused by If the insured has agreed in a contract or agreement an "offense" that is committed; ~oer~~~v~rt~~~~~~~tf!~ ~i2h~a~::~~~v~~~t:~a/~~~v:~ ~:it~quent to the execution of the contract or agree· against such person or organization. but only for
payments we make because of:

UM 04 88 07 08 (!;) 2008 The Travelers Companies , Inc. Page 1 of 1 Includes the copyr ighted material of Insurance Servlc es Office . Inc. with its permission.

THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY.

WAIVER OF OUR RIGHT TO RECOVER FROM
OTHERS ENDORSEMENT· CALIFORNIA
Policy Number: 02 WEC CR2756 Endorsement Number:

Effective Date: 09/01 /18 Effective hour is the same as stated on the Information Page of the policy .

Named Insured and Address: CHANDLER ASSET MANAGEMENT, INC 6225 LUSK BLVD
SAN DIEGO CA 92121
We have the right to recover our payments from anyone liable for an injury covered by this policy . We will not enforce our right against the person or organization named in the Schedule. (This agreement applies only to the extent that you perform work under a written contract that requires you to obtain this agreement from us.) You must maintain payroll records accurately segregating the remuneration of your employees while engaged in the work described in the Schedule.

The additional premium for this endorsement shall be 2 % of the California workers' compensation premium otherwise due on such remuneration .

SCHEDULE
Person or Organization Job Description
Any person or organization from whom you are required by written contr act or agreement to obtain this waiver of rights from us
Countersigned by --------------c--,---,--------,-,:,------­ Authorized Represent ative
Form WC 04 03 06 (1) Printed in U.S.A.

Process Date: 08/06/18 Policy Expiration Date: 09/01 /19 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY.

WAIVER OF OUR RIGHT TO RECOVER

FROM OTHERS ENDORSEMENT
Policy Number: 02 WEC CR2756 Endorsement Number:

Effective Date: 09/01 /18 Effective hour is the same as stated on the Information Page of the policy.

Named Insured and Address: CHANDLER ASSET MANAGEMENT , INC 6225 LUSK BLVD
SAN DIEGO CA 92121
We have the right to recover our payments from anyone liable for an injury covered by this policy. We will not enforce our right against the person or organization named in the Schedul e.

This agreement shall not operate directly or indirectly to benefit anyone not named in the Schedule.

SCHEDULE
Any person or organization from whom you are required by contract or agreement to obtain this waiver from us.

Endorsement is not applicable in KY, NH, NJ or for any MO construction risk Form WC 00 03 13 Printed in U.S.A.

Process Date: 08/06/18
Countersigned by ---------- --,----,- --,-=--- --c--­
Authorized Representative
Policy Expiration Date: 09/01 /19
THIS ENDORSEMENT CHANGES THE POLICY . PLEASE READ IT CAREFULL V.

CALIFORNIA CANCELLATION ENDORSEMENT
Policy Number: 02 WEC CR2756 Endorsement Number:

Effective Date: 09/01/18 Effective hour is the same as stated on the Information Page of the policy.

Named Insured and Address: CHANDLER ASSET MANAGEMENT, INC 6225 LUSK BLVD
SAN DIEGO CA 92121
This endorsement applies only to the insurance
provided by the policy because California is shown in
Item 3.A. of the Information Page.

The cancellation condition in Part Six (Conditions) of
the policy is replaced by these conditions:

Cancellation

1. You may cancel this policy . You must mail or
deliver advance written notice to us stating when
the cancellation is to take effect.

2. We may cancel this policy for one or more of the
following reasons :
a. Non-payment of premium ;
b. Failure to report payroll;
c. Failure to permit us to audit payrol l as required
by the terms of this policy or of a previous
policy issued by us;
d. Failure to pay any additional premium
resulting from an audit of payroll required by
the terms of this policy or any previous policy
issued by us;
e. Material misrepresentation made by you or
your agent;
f. Failure to cooperate with us in the
investigation of a claim;
g. Failure to comply with Federa l or State safety
orders;
h. Failure to comply with written
recommendations of our designated loss
control representatives;
i. The occurrence of a material change in the
ownership of your business;
j. The occurrence of any change in your
business or operations that materially
increases the hazard for frequency or severity
of loss;
k. The occurrence of any change in your
business or operation that requires additional
or different classification for premium
calculation ;
I. The occurrence of any change in your
business or operation which contemplates an
activity excluded by our reinsurance treaties.

3. If we cancel your policy for any of the reasons
listed in (a) through (f), we will give you 10 days
advance written notice , stating when the
cancellation is to take effect. Mailing that notice to
you at your mailing address shown in Item 1 of the
Information Page will be sufficient to prove notice.

If we cancel your policy for any of the reasons
listed in Item (g) through (I), we will give you 30
days advance written notice; however , we agree
that in the event of cancellation and reissuance of
a policy effective upon a material change in
ownership or operations, notice will not be
provided.

4. The policy period will end on the day and hour
stated in the cancellation notice .

Countersigned by: ---- ------ ---- --- --
Form WC 04 06 01 A Printed in U.S.A.

Process Date: 08/06/1 B
Authorized Representative
Policy Expiration Date: 09/01 /19
THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY .

CALIFORNIA MANDATORY ENDORSEMENT
This endorsement modifies insurance provided under the following:

COMMERCIAL EXCESS LIABILITY (UMBRELLA) INSURANCE

PROVISIONS

1. The following replaces Paragraph 3. b. of SEC­
TION IV - CONDITIONS.
b. We may cancel this insurance as follows:

INSURANCE IN EFFECT FOR 60 DAYS OR
LESS
If this insurance has been in effect · for 60
days or less, and is not a renewal of a policy
we have previously issued. we may cancel
this insurance by mailing or delivering to the
first Named Insured. at the mailing address
shown in the policy. and to the producer of
record, advance written notice of cancellation.
stating the reason for cancellation, at least:
(1) 10 days before the effective date of can­
cellation if we cancel for:
(a) Nonpayment of premium; or
(b) Discovery ·of fraud or material misrep­
resentation by:
(I) Any insured or his or her repre­
sentative in obtaining this insur­
ance; or
(ii) You or your representative in
pursuing a claim under this pol­
icy.
(2) 30 days before the effective date of can­
cellation if we cancel for any other rea­
son.

INSURANCE IN EFFECT FOR MORE THAN
60 DAYS
(1) If this insurance has been in effect for
more than 60 days or is a renewal, we
may cancel this insurance only upon the
occurrence, after the effective date of the
insurance, of one or more of the follow­
ing:
(a) Nonpayment of premium, including
payment due on prior insurance we
issued and due during the current in­
surance term covering the same
risks.
(b) Discovery of fraud or material misrep­
resentation by:
- (i)- A11y- rn-su,e1:lor1Tis- or- her repre­
sentative in obtaining this insur­
ance; or
(Ii) You or your representative in
pursuing a claim under this insur­
ance.
(c) A judgment by a court or an adminis­
trative tribuna I that you have violated
a California or Federal law, having as
one of its necessary elements an act
which materially increases any of the
risks insured against.
(d) Discovery of willful or grossly negli­
gent acts or omissions, or of any vio­
lations of stale laws or regulations es­
tablishing safety standards. by you or
your representative, which materially
increase any of the risks insured
against.
(e) Failure by you or your representative
to implement reasonable loss control
requirements, agreed to by you as a
condition of insurance issuance, or
which were conditions precedent to
our use of a particular rate or rating
plan, if that failure materially in­
creases any of the risks insured
against.
(f) A determination by the Commissioner
of Insurance that the:
(I) Loss of, or changes in, our rein­
surance covering all or part of the
risk would threaten our financial
integrity or solvency: or
(Ii) Continuation of the insurance
would place us in violation of
California law or the laws of the
state where we are domiciled, or
threaten out solvency.
(g) A change by you or your representa­
tive in the activities or property of the
commercial or industrial enterprise,
UM 01 09 02 12 Copyright 2012 . The Travelers Indemnity Company. All Rights Reserved. Page 1 of 2 ... == == "'­
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012038
which results in a materially added,
increased or changed risk, unless the
added, increased or changed risk is
included in the insurance.
(h) A material change in limits. type or
scope of coverage, or exclusions in
one or more of the underlying poli­
cies,
(i) Cancellation or nonrenewal of one or
more of the underlying policies where
such policies are not replaced without
lapse.
(j) A reduction in financial rating or
grade of one or more insurers, insur­
ing one or more underlying policies
based on an evaluation obtained from
a recognized financial rating organi­
zation.
(2) If this insurance has been in effect for
more than 60 days or is a renewal, we will
mail or deliver advance notice of cancel­
lation, stating the reason for cancellation.
to the first named insured, at the mailing
address shown in the policy, and to the
producer of record, at least:
(a) 1 o days before the effective date of
cancellation if we cancel for a reason
listed in Paragraph (1) (a) or (b)
above; or
(b) 30 days before Lhe effective date of
cancellation if we cancel for any other
reason listed in Paragraph (1) above.

2. Paragraph 3. c. of SECTION IV - CONDITIONS.
is deleted .

3. The following replaces Paragraph 3.e, of SEC­
TION IV - CONDITIONS.:
e. If this insurance is cancelled, we will send the
first Named Insured any premium refund due.

The refund, if any, will be computed on a pro
rata basis. However, the refund may be less
than pro rata if we made a loan to you for the
purpose of payment of premiums for this pol­
icy. The cancellation will be effective even if
we have not made or offered a refund.

4. The following is added to SECTION IV - CONDI­
TIONS.:

WHEN WE 00 NOT RENEW
1t' we elect not to renew this policy, we will mail or
deliver written notice, stating the reason for non­
renewal, to the first Named Insured, at the mailing
address shown in the policy, and to the producer
of record, at least 60 days, but not more than 120
days, before the expiration or anniversary date.

o= =
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000847
THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY .

CALIFORNIA CHANGES - CANCELLATION

AND NONRENEWAL
This endorsement modifies insurance provided under the following:

CAPITAL ASSETS PROGRAM (OUTPUT POLICY) COVERAGE PART

COMMERCIAL AUTOMOBILE COVERAGE PART
C_QMMERClALG£filML LlAHLLl"D'_C_O __ ~.ERAGE_eAfil __

COMMERCIAL INLAND MARINE COVERAGE PART

COMMERCIAL PROPERTY COVERAGE PART

CRIME AND FIDELITY COVERAGE PART
EMPLOYMENT-REL.A.TED PRACTICES LIABILITY COVERAGE PART

EQUIPMENT BREAKDOWN COVERAGE PART

FARM COVERAGE PART

LIQUOR LIABILITY COVERAGE PART

MEDICAL PROFESSIONAL LIABILITY COVERAGE PART

POLLUTION LIABILITY COVERAGE PART

PRODUCTS/COMPLETED OPERATIONS LIABILITY COVERAGE PART
A. Paragraphs 2. and 3. of the Cancellation Com­
mon Policy Cond1tton are replaced by the follow­
ing·

2. All Policies In Effect For 60 Days Or Less
If this policy has been 1n effect for 60 days or
less, and 1s not a renewal of a policy we have
previously issued, we may cancel this pohcy
by malling or delivering to the first Named In­
sured, at the mailing address shown rn the
policy, and to the producer of record, advance
written notice of cancellation, statrng the rea­
son for cancellat1on, at least·
a. 10 days before the effective date of can­
cellation 1f we cancel for·
(1) Nonpayment of premium ; or
(2) Discovery of fraud by.
(a) Any insured or his or her repre­
sentative rn obtammg thrs insur­
ance, or
(b) You or your representative 1n
pursuing a claim under this pol­
icy
b. 30 days before the effective date of can­
cellation 1f we cancel for any other rea­
son

3. All Policies In Effect For More Than 60 Days
a. If this pol/Cy has been m effect for more than
60 days, or ,s a renewal of a policy we issued,
we may cancel this policy only upon the oc-
currence , aft.er the effective date of the policy,
of one or more of the following :
(1) Nonpayment of premium. 1nclud1ng pay­
ment due on a prior policy we issu ed and
dlle during the current polrcy term cover­
ing the same rrsks.
(2) Discovery of fraud or materi al m1srepre­
sentat1on by.
(a) Any insured or his or her representa­
tive in obtarn1ng this insurance, or
(b) You or your representative rn pursu­
ing a claim under this policy
(3) A Judgment by a court or an adm1nrstra­
t1ve tribunal that you have violated a Calr­
forn1a or Federal law, having as one of its
necessary elements an act which materr­
ally increases any of the risks insured
against
(4) Discovery of willful or grossly negligent
acts or om1ss1ons. or of any v1olat1ons of
state laws or regulations establ1shrng
safety standards, by you or your repre ­
sentative. which materrally increase any
of the risks insured against.
(5) Failure by you or your representative to
implement reasonable Joss control re­
quirements. agreed to by you as a cond1-
t1on of policy issuance. or which were
cond1t1ons precedent to our use of a par­
ticular rate or rating plan, 1f that failure
IL 02 70 09 12 © Insurance Services Office, Inc , 2012 Page 1 of 3 materially increases any of the risks in­
sured against
(6) A determination by the Comm1ss1oner of
Insurance that the .
(a) Loss of. or changes in, our reinsur­
ance covering all or part of t he risk
would threaten our financial integrity
or solvency. or
(b) Cont1nuat1on of the policy coverage
would
(I) Place us 1n v1olat1on of California
law or the laws of the state where
we are dom1c1led, or
(Ii) Threaten our solvency.
(7) A change by you or your representative tn
the act1v1t1es or property of the commer­
cial or industrial enterprise, which results
1n a materially added, increased or
changed risk, unless the added, in­
creased or changed nsk 1s included 1n the
pohcy
b. We will mail or deliver advance written notice
of cancellat1on, stating the reason for cancel­
lation, to the first Named Insured, at the mail­
ing address shown m the policy, and to the
producer of record, at least.
(1) 1 0 days before the effective date of can­
cellatton rr we cancel for nonpayment of
premium or discovery of fraud ; or
(2) 30 days before the effective date of can­
cellatmn 1f we cancel for any other reason
listed in Paragraph 3.a.

B. The following prov1s1on 1s added to the Cancella­
tion Common Policy Cond1t1on:

7. Residential Property
This prov1s1on applies to coverage on real
property which 1s used predominantly for
res1dent1al purposes and cons1st1ng of not
more than four dwelling units, and to cover­
age on tenants' household personal property
in a res1dent1al unit, 1f such coverage 1s writ­
ten under one of the following
Commercial Property Coverage Part
Farm Coverage Part - Farm Property - Farm
Dwellings, Appurtenant Structures And
Household Personal Property Coverage Form
a. If such coverage has been 1n effect for 60
days or less. and 1s not a renewal of cov­
erage we preY1ously issued, we may can­
cel this coverage for any reason, except
as provided in b. and c. below.
b. We may not cancel th is policy solely be­
cause the first Named Insured has·
(1) Accepted an offer of earthquake cov­
erage, or
(2) Cancelled or did not renew a policy
issued by the Cahforn,a Eartt,quake
Authority (CEA) that included an
earthquake policy premium su1-
charge
However, we shall cancel this policy 1f the
first Named Insured has accepted a new
or renewa l pohcy issued by the CEA that
includes an earthquake policy premium
surcharge but fails to pay the earthquake
policy premium surcharge authorized by
the CEA
c. We may not cancel such coverage solely
because corrosive soil conditions exist on
the premises This restriction {c.) applies
only 1f coverage 1s subJect to one of the
following, which exclude loss or damage
caused by or resulting from corrosive sotl
conditions ·
(1) Commercial Property Coverage Part
- Causes Of Loss - Special Form , or
(2) Farm Coverage Part - Causes Of
Loss Form - Farm Property, Para­
graph D. Covered Causes Of Loss -
Special
C. The following 1s added and supersedes any pro­
v1s1ons to the contrary:

Nonrenewal

1. SubJect to the prov1s1ons of Paragraphs C.2.
and C.3. below, 1f we elect not to renew this
policy, we will mail or deliver written notice.
stating the reason for nonrenewal, to the first
Named Insured shown 1n the Declarat.Jons,
and to the producer of record. at least 60
days. but not more than 120 days , before the
exp1rat1on or anniversary date
We will mail or dehver our notice to the first
Named Insured, anc:I to the producer of re­
cord, at the mailing address shown 1n the pol­
icy

2. Reside ntla I Property
This prov1s1on applies to coverage on real
property usec:I predominantly for res1dent1al
purposes and consisting of not more than four
dwell ing units. and to coverage on tenants'
household property contained 1n a res1dent1al
unit 1f such coverage 1s written under one of
the following:

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000646
Commercial Property Coverage Part to the changes in our reinsurance po- Farm Coverage Part - Farm Property - Farm srtion.

Dwellings. Appurtenant Structures And c. We will not refuse to renew such cover - Household Personal Property Coverage Form age solely because the first Named In- a. we may elect not to renew such cover - sured has cancelled or d1d not renew a pohcy. issued by the Calrforn1a Earth-
age for any reason. except as provided in quake Authority, that included an earth- b., c. and d. below. quake poltcy premium surcharge.
b. We will not refuse to renew such cover- d. We will not refuse to renew such cover- age solely because the first Named In- age solely because corrosive soil cond1- sured has accepted an offer of earth- t1ons exist on the premises . This restnc- - fj1:1-ake E-ever-age -------- t1_o_n_(_d ___ ) _a_p_p~l1e_s_ o---'n'-,--ly- 1f_ c_ov_e_r_a_g_e_1s- su~b--- However. the following applies only to 1n- ,ect to one of the following, which exclude surers who are associate part1c1pat1ng in- loss or damage caus e d by or resulting surers as established by Cal. Ins. Code from corrosive soil cond1t1ons.

Section 10089 16. We may elect not to
renew such coverage after the first (1) Commercial Property Coverage Part Named Insured has accepted an offer of - Causes Of Loss - Special Form; or earthquake coverage, 1f one or more of (2) Farm Coverage Part - Causes Of the following reasons applies: Loss Form - Farm Property . Para- (1) The nonrenewal 1s based on sound graph D. Covered Causes Of Loss - underwrrtmg pr1nc1ples that relate to Special.
the coverages provided by this policy 3, We are not required to send notice of nonre- and that are consistent with the ap- newal in the following s1tuat1ons:
proved rating plan and related docu-
ments filed wrth the Department of a. If the transfer or renewal of a policy, with- Insurance as required by existing law: out any changes in terms, cond1t1ons or rates, 1s between us and a member of our
(2) The Comm1ss1oner of Insurance finds insurance group. that the exposure to potential losses
will threaten our solvency or place us b. If the poltcy has been extended for 90 in a hazardous condition. A hazard - days or less, provided that notice has ous cond1t1on includes, but is not l1m- been gtven m accordance with Paragraph 1ted to, a cond1t1on m which we make C.1.
claims payments for losses resulting c. If you have obtained replacement cover- from an earthquake that occurred age, or 1f the first Named Insured has wtthtn the preceding two years and agreed. m writing, w1thtn 60 days of the that required a reduction rn policy- termination of the policy, to obtain that holder surplus of at least 25% for coverage .
payment of those claims, or
d. If the polrcy 1s for a period of no more
(3) We have : than 60 days and you are notified at the
IL 02 70 09 12
(a) Lost or experienced a substantial time of issuance that tt w,11 not be re- reduction in the avaliab1hty or newed .
scope of reinsurance coverage; e. If the first Named Insured requests a or change tn the terms or cond1t1ons or risks
(b) Experienced a substantial m­
creas e 1n the premium charged
for reinsurance coverage of our
res1dent1al property insurance
poltc,es, and
the Comm1ss1oner has approved a
plan for the nonrenewals that 1s fair
and equitable. and that 1s responsive
covered by the policy w1th1n 60 days of
the end of the policy period
f. If we have made a written offer lo the first
Named Insured, 1n accordance with the
t1meframes shown 1n Paragraph C.1 ., to
renew the poltcy under changed terms or
cond1t1ons or at an increased prem ium
rate, when the increase exceeds 25%
© Insurance Services Office, Inc., 2012 Page 3 of 3