5_Summary_Plan_Overview.pdf

HIGHLIGHTS

Eligibility Who can participate in the Plan: All SEC employees, except (1) nonresident aliens and (2) employees whose positions are not eligible to participate in the Thrift Savings Plan.

Contributions Who can put money into the Plan:

How contributions are calculated:

Only the SEC. Employees cannot contribute to the Plan.

The amount you will receive depends on how much you contribute to the TSP each pay period as a % of your compensation. See p. 4.

Vesting When you become the owner of the money in your account:

If you were an SEC employee at any time between January 1, 2015 and September 30, 2015, you are automatically 100% vested (i.e., you own the money, even if you cannot currently withdraw it).

If you became an SEC employee on or after October 1, 2015, you will not own any part of the account until you have completed three years of continuous SEC service.

Investments How is the Plan money invested: 100% of the Plan is invested in a commercial bank account that is not regulated or overseen by the SEC.

Withdrawals When some or all of the vested money can be taken out of your account:

Upon terminating SEC employment, whether for other employment or to retire (or by your beneficiary(ies) if you die).

While you are still working at the SEC, you can take withdrawals if you meet any of the following: (1) you are (or become) at least age 59 ½; (2) you are withdrawing money that has been in the account for at least two years;

or (3) you have been a participant for at least five years.

Tax Treatment Consult a tax advisor for information specific to your situation.

You are not taxed on contributions as they are made.

If you transfer the full amount you withdraw into another qualified retirement vehicle (including the TSP), you will not be taxed at the time of the withdrawal from the SEC’s Supplemental Retirement Plan.

You will be taxed on any amount you withdraw that you do not transfer into another qualified retirement vehicle. You may also have to pay an additional tax as a penalty.

TABLE OF CONTENTS

Introduction

Who can Participate in the Plan?

What is my Compensation for purposes of the Plan?

How much will the SEC contribute to the Plan for me? .............................................................................. 4 – 7

FERS-covered employees

CSRS-covered employees

Maximizing your benefit ....................................... 5 – 6

TSP catch-up contributions

415(c) limit on contributions

When will I be Vested? ........................................... 8 – 9

In General

Converting from ineligible to eligible position

When (and How) can I take my money out? 10 – 15

When you leave the SEC

Upon your death

While you’re still an SEC employee ................. 12 – 15

Are there Tax Issues I should consider?

What happens if I leave the SEC, but come back later?

Other Important Notes ..................................... 18 – 20

How is the Plan money invested?

Will Plan expenses be deducted from my account balance?

What if I think there is a mistake in my account? .. 18

What if I move, get married/divorced, etc.?

Can creditors take my Plan balance?

Can the SEC change the Plan?

How do I request a transfer into the TSP?

How do I designate a beneficiary?

What if there is a dispute?

What impact does Military Service have on my Plan rights and benefits?

SEC Supplemental Retirement Plan Overview | February 2017 Page 1

INTRODUCTION

Welcome to the SEC’s Supplemental Retirement Plan!

The SEC is pleased to bring you this benefit, which was negotiated for employees by National Treasury Employees Union ("NTEU”), as part of its effort to attract and retain the best and brightest staff, who are dedicated to its mission to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation.

The SEC Supplemental Retirement Plan—referred to in this document as “the Plan”—has been adopted to provide you with the opportunity to save additional money for your retirement.

This Overview addresses the most common questions you may have about the Plan. It has been written in plain language to make it easy to understand. But this Overview is not the document that establishes your legal rights, and if anything in this Overview conflicts with the legally governing documents, those documents always govern. If you would like a copy of the legally governing Plan documents, please contact the Office of Human Resources.

While it is the SEC’s intention to continue the Plan indefinitely, the SEC reserves the right to terminate its contributions or modify, amend, or terminate the Plan in whole or in part at any time. You will be 100% vested in the event of a Plan termination. In addition, the Plan is subject to federal laws which may change—and require the Plan to be changed—at any time. You will be notified of any changes to the Plan that affect you.

Thank you for taking the time to read this Overview. If you have any questions, please contact OHR or Wells Fargo (the Plan Trustee) as follows:

Office of Human Resources Wells Fargo Institutional Retirement and Trust 100 F Street NE 401 S. Tryon Street Washington, DC 20549 Charlotte, NC 28288 SupplementalRetirement@sec.gov InstitutionalRetirementAndTrust@wellsfargo.com mailto:SupplementalRetirement@sec.gov mailto:InstitutionalRetirementAndTrust@wellsfargo.com

SEC Supplemental Retirement Plan Overview | February 2017 Page 2

WHO CAN PARTICIPATE IN THE PLAN?

All full-time, temporary, and part-time SEC employees are eligible to participate in the Plan unless the employee is:

A nonresident alien, A leased employee (for example, an employee of an SEC contractor), or

In a position that is not eligible to participate in the Thrift Savings Plan (TSP) (e.g., an unpaid intern or a temporary appointment not to exceed one year).

In general, if you meet the eligibility criteria listed above, you will automatically become a Plan participant on the date you become an SEC employee.

You are a Plan participant even if you are not contributing enough to the TSP to receive a contribution in this Plan. This is important because it affects your vesting (see p. 8) and withdrawal (see p. 10) rights.

If you are not eligible to become a Plan participant when you are hired, but you later become eligible, then you will automatically become a Plan participant on the date you become eligible.

Example: Alice is hired by the SEC on October 1, 2015, in a temporary position not to exceed one year.

She is later selected for a permanent SEC position and starts that new position effective October 1, 2016.

Because Alice is now eligible to participate in the Plan, she automatically becomes a participant on October 1, 2016. Even though she wasn’t a Plan participant at the time, Alice will receive credit for her initial year of SEC service for purposes of vesting.

Special eligibility provision for 2015:

If you were an eligible SEC employee at any time between January 1, 2015 and September 30, 2015, you became a participant in the Plan as of January 1, 2015 regardless of when you became an SEC employee. For example:

Tim was hired by the SEC on March 5, 1992;

Mary was hired on September 30, 2015; and Angus was hired on October 1, 2015.

Tim and Mary both became participants as of January 1, 2015. Angus became a participant as of October 1, 2015.

SEC Supplemental Retirement Plan Overview | February 2017 Page 3

WHAT IS MY COMPENSATION FOR PURPOSES OF THE PLAN?

In this Plan, “Compensation” has the same meaning as it does for purposes of the TSP: your basic pay (i.e., salary and locality pay). This means, for example, that cash awards, overtime, and bonuses are not included. There are some adjustments to your basic pay that will be made for purposes of calculating your compensation:

1. Compensation does not include amounts you earn while you are not a participant in the Plan. (Because contributions are calculated on a pay-period basis, this will not generally have any effect.)

2. Compensation includes elective deferrals to any other qualified plan. For example, if your annual salary is $100,000 and you elect to contribute 8% to the TSP, even though you don’t take that 8% home in your paycheck, your “compensation” for purposes of this Plan is still $100,000.

3. Compensation also includes pre-tax money you pay for other health and welfare benefits. For example, if your salary is $100,000 and your health insurance premiums (paid through withholding from your SEC paycheck) are $5,000, your “compensation” for purposes of this Plan is still $100,000.

4. Compensation includes amounts you receive after you terminate SEC employment, as long as it is for work you performed as an SEC employee while you were a Plan participant. Thus, your last salary payment is generally “compensation” for purposes of the Plan even though you receive it after you have left, but any part of that payment that is for earned but unused vacation time is not “compensation” for purposes of the Plan.

5. By law, Compensation does not include amounts above a prescribed dollar limit—in 2017, $270,000 (subject to annual change.)

Example: Titus earns $200,000 annually (i.e., $7,692 per pay period) as an SEC attorney. Each pay period, he contributes 8% of his salary ($615) to the TSP, so he receives the maximum 3% contribution in his Plan account. In October 2016, he receives a one-time cash bonus of $2,000 but does not change his TSP contribution.

$ 7,692 regular pay +$ 2,000 bonus $ 9,692 total pay for that one pay period

Even though his $615 TSP contribution for that pay period is only about 6% of his total pay, the bonus is not “Compensation” for purposes of the Plan. Thus, Titus will receive his usual full 3% contribution into the Plan.

SEC Supplemental Retirement Plan Overview | February 2017 Page 4

HOW MUCH WILL THE SEC CONTRIBUTE TO THE PLAN FOR ME?

The SEC will contribute an amount to this Plan based on your contributions to the TSP as a percentage of your Compensation (see p. 3), up to a maximum contribution equal to 3% of your compensation. Contributions are calculated on a payroll-by-payroll basis (see p. 5).

FERS-covered employees need to contribute more than 5% into the TSP to receive Plan contributions. The SEC will contribute an amount equal to the amount by which your TSP contributions exceed 5%, to a maximum contribution equal to 3% of your compensation.

Example 1a: Michael’s compensation is $100,000. He contributes 5% into the TSP. The SEC will not make any contribution to Michael’s Plan account.

Example 1b: Michael increases his TSP contribution to 7% of his compensation. The SEC will contribute 2% ($2,000) into his Plan account.

Example 1c: Michael increases his TSP contribution to 10% of his compensation. The SEC will contribute 3% ($3,000) into his Plan account—the maximum contribution (as a percentage of compensation) the SEC will make under the Plan.

EXCEPTION: If you contribute the maximum dollar amount allowed by law to the TSP (for 2017, $18,000), and that amount is less than 8% of your compensation, the SEC will still make the maximum contribution of 3% of your compensation into your Plan account.

Example 2: Chantel’s compensation is $230,000. She contributes the maximum allowed by law ($18,000) to the TSP. Even though that is only 7.8% of Chantel’s compensation, the SEC will contribute a full 3% of her compensation ($6,900) into her Plan account.

SEC Supplemental Retirement Plan Overview | February 2017 Page 5

HOW MUCH WILL THE SEC CONTRIBUTE TO THE PLAN FOR ME? (cont’d)

CSRS-covered employees need to make contributions into the TSP to receive Plan contributions. The SEC will contribute an amount equal to the amount you contribute to the TSP, up to a maximum contribution equal to 3% of your compensation.

Example 3a: Sam is a CSRS employee whose compensation is $200,000. He does not make any contribution into the TSP. The SEC will not make any contribution to Sam’s Plan account.

Example 3b: Sam begins contributing 2% of his compensation into the TSP. The SEC will contribute 2% ($4,000) into his Plan account.

Example 3c: Sam increases his TSP contribution to 4% of his compensation. The SEC will contribute 3% ($6,000) into his Plan account—the maximum contribution (as a percentage of compensation) the SEC will make under the Plan.

Although the examples above reflect annual compensation for simplicity, contributions to the Plan will be calculated on a pay-period by pay-period basis.

Example 4a: Katherine is a CSRS employee whose annual compensation is $200,000. She contributes 2% of her annual compensation ($4,000) into the TSP in a single lump sum on January 2. Because Katherine’s compensation by pay period is $7,692, the SEC will only contribute 3% of that pay period amount ($231) into her Plan account. Assuming Katherine does not make any additional contributions into the TSP, she will not receive any additional contributions into the Plan.

Example 4b: Assume instead that Katherine contributes 2% of her biweekly compensation into the TSP each pay period ($154). The SEC will contribute an equal amount into her Plan account. At the end of the year, Katherine will have contributed the same 2% of her annual salary as in Example 4a, but she will have received a corresponding $4,000 contribution in her Plan account.

To maximize your benefit under this Plan, you must contribute to the TSP every pay period.

SEC Supplemental Retirement Plan Overview | February 2017 Page 6

Because contributions are calculated on a pay-period by pay-period basis, to maximize your benefit under this Plan you may need to increase your TSP contributions if you receive a pay raise or a promotion.

Example 5a: Rocco is a FERS employee whose compensation is $3,500 per pay period. He contributes a fixed amount of $245 (7% of his compensation) to the TSP each pay period. Accordingly, the SEC contributes $70 (2%) to the Plan each pay period. During 2016, he receives a cost-of-living increase and a merit pay increase, increasing his biweekly compensation to $3,650. If he does not change his TSP contribution, his contribution as a percent of compensation will drop to 6.7% and the SEC’s contribution to the Plan will be reduced to $62.05 (1.7%) per pay period.

Example 5b: Same as Example 5a, except Rocco designates his TSP contributions as a fixed 7% of compensation each pay period (rather than a fixed dollar amount). When his compensation increases, his contribution to the TSP automatically increases to maintain a 7% rate. As a result, the SEC’s contribution to the Plan will remain 2%, for a biweekly contribution of $73.

SEC Supplemental Retirement Plan Overview | February 2017 Page 7

TSP CATCH-UP CONTRIBUTIONS ARE NOT COUNTED

In calculating how much you contribute to the TSP, catch-up contributions are not counted. (Catch-up contributions are extra contributions beyond the normal IRS annual dollar limit that are permitted if you are age 50 or older.)

Example 6: Kristen is 53 years old and earns $240,000 per year. She contributes the maximum allowed by law to the TSP ($18,000). She is permitted to make a catch-up contribution (up to an additional $6,000), but she chooses not to. Although her contribution is only 7.5% of her salary, the SEC will contribute the maximum 3% into her Plan account. This is true even though she could elect to contribute 8% (or more) of her salary to the TSP, because she can only do so via a catch-up contribution, and catch-up contributions are not counted for this purpose.

415(c) LIMIT ON CONTRIBUTIONS

The total amount of (1) your own contributions to the TSP (not including catch-up contributions), (2) the SEC’s matching contributions into the TSP, and (3) the SEC’s contributions to your Plan account cannot exceed a limit set by law—$54,000 for 2017 (subject to change annually). (If you earn less than $54,000, the 415(c) Limit is 100% of your compensation.)

Example 7: Kristen (from Example 6) would not be impacted by the 415(c) Limit.

Her own contributions to TSP $ 18,000

Agency automatic and matching contributions to TSP $ 12,000

SEC contribution to the Plan $ 7,200

Total $ 37,200

In the unlikely event that you exceed the 415(c) Limit, the SEC will reduce the amount contributed to the Plan on your behalf for the year. If your Plan contribution is reduced to $0 for the year but you still exceed the 415(c) Limit, the remaining adjustment will be made by the TSP in accordance with its plan terms.

SEC Supplemental Retirement Plan Overview | February 2017 Page 8

WHEN WILL I BE VESTED?

Vesting refers to when you become the owner of the money held in your Plan account. In this Plan, you are either not vested—i.e., do not own any of the money in your account—or vested–i.e., fully own all of the money in your account.1

Your account is not vested until you have completed 3 years of continuous SEC service unless any of the following apply:

1. You are (or become) at least 65 years old.

2. You separate from the SEC based on an Office of Personnel Management-approved disability retirement.

3. You are subject to a Reduction in Force.

4. You die.

5. The SEC terminates the Plan.

6. You were deemed to have been a Plan participant as of January 1, 2015 (see p. 2).

If your SEC employment terminates before you are vested—even by one day—you will permanently forfeit all the money in your

Plan account.

Example 1: Sarah was hired by the SEC on July 1, 2016—her 64th birthday. Sarah will be vested in her account on July 1, 2017. On that date, even though she has served the SEC for fewer than three years, she will become vested because she will have reached age 65.

Example 2: Carl was hired by the SEC on July 1, 2016—his 31st birthday. Carl dies on September 2, 2016 while still an SEC employee. Upon his death, even though he served the SEC for fewer than three years, Carl’s account will become vested and will pass to his beneficiary(ies).

1 Rehired employees may have both vested and non-vested amounts in a single account. See p. 17.

SEC Supplemental Retirement Plan Overview | February 2017 Page 9

WHEN WILL I BE VESTED? (cont’d)

Example 3: Lynn was employed by the SEC from January 1, 1990 to December 31, 1999. She is hired again by the SEC on July 1, 2016—her 52nd birthday. Lynn retires on June 30, 2019 because she believes a health condition requires her immediate retirement. Despite Lynn’s reason for retiring, OPM does not approve Lynn’s application for disability retirement. Lynn does not get credit for her prior service, and no exceptions to the 3-year vesting rule apply. Thus, Lynn is not vested in her account on the day her employment terminates, and she will forfeit the entire account balance—even though she would have been vested the next day.

Example 4: Chris was hired by the SEC on September 30, 2015 (at age 35) into a position that is eligible to participate in the TSP. He terminates his SEC employment for another federal position on January 1, 2016.

Chris is 100% vested in his account even though he served the SEC for fewer than three years, because he was deemed to have been a Plan participant as of January 1, 2015.

Converting from Ineligible to Eligible Positions. For purposes of vesting, employees receive credit for all years of current and continuous service as an SEC employee. Thus, if you convert from an ineligible position to an eligible one, you will receive credit for all your years of continuous SEC service for purposes of vesting.

Example 5: Donna was hired by the SEC on June 1, 2015 (at age 22) on a temporary appointment not to exceed one year. That appointment is renewed for a second year starting June 1, 2016. On May 30, 2017, Donna is hired into a permanent SEC position and automatically becomes a Plan participant on that day. Donna is not immediately 100% vested, because none of the exceptions to the 3-year vesting rule apply. But she will become 100% vested on June 1, 2018, because she will have completed three years of continuous service even though her first two years she was ineligible for the Plan.

SEC Supplemental Retirement Plan Overview | February 2017 Page 10

WHEN (AND HOW) CAN I TAKE MY MONEY OUT?

When you leave the SEC.

When your employment with the SEC ends, you have the right to withdraw your vested balance – regardless of your age and whether you plan to retire or to continue working.

If your vested account balance is at least $1,000 and you are less than 65 years old, your account balance will not be automatically distributed to you. You must request that your balance be distributed to you or transferred to another qualified retirement vehicle (including the TSP) or an IRA. You should consult with a qualified tax and/or financial planner to decide what action would be in your best interest. If this provision applies to you, you can request a distribution or transfer at any time after your SEC employment ends until you are 70½ years old—at which point the law requires the Plan to automatically cash you out.2

If your vested account balance is less than $1,000 or you are at least 65 years old, you cannot leave your money in the Plan. It will automatically be distributed to you by check mailed to the address associated with your Plan account. If you would rather have the money transferred directly to another qualified retirement plan (including the TSP) or an IRA, you must make that request within 60 days after your SEC employment ends.

Example 1a: Criss ends her SEC employment when she is 40 years old and has a vested account balance of $1,500. She will not receive that money until and unless she requests it, which she can do at any time until she is age 70 ½. If the money is still in her account when she reaches that age, it will automatically be distributed to her as a check mailed to the address associated with her account, unless she requests a direct transfer to another qualified retirement account or an IRA. [Note that, if she leaves her money in the Plan until the law requires it to be distributed to her, a portion of the distribution will be a so-called “required minimum distribution” that Criss must take into income (it cannot be rolled into another qualified retirement plan or IRA). Criss would get that info and her options at the appropriate time.]

Example 1b: Assume instead that Criss has a vested account balance of $999 when she terminates employment. The full amount will automatically be distributed to her as a check mailed to the address associated with her account, unless she requests a direct transfer to another qualified retirement account or an IRA within 60 days.

2 Technically, the mandatory distribution has to be made no later than April 1st following the year in which you reach age 70½. So you might actually be 71 years old by then.

SEC Supplemental Retirement Plan Overview | February 2017 Page 11

WHEN (AND HOW) CAN I TAKE MY MONEY OUT? (cont’d)

Example 1c: Assume instead that Criss is 66 years old when she terminates employment. Regardless of her account balance, the full amount will automatically be distributed to her as a check mailed to the address associated with her account, unless she requests a direct transfer to another qualified retirement account or an IRA within 60 days.

Upon your death (whether an SEC employee at the time or not).

If you have a Plan balance when you die, the entire amount will be paid to your spouse (if applicable) or to your estate.

If you want to designate a different beneficiary (or beneficiaries) to receive your Plan balance, you must file a Designation of Beneficiary form. (If you are married and want to designate someone other than your spouse as beneficiary, you will need your spouse’s written consent.)

Other beneficiary forms you may have filed for other purposes—including with the TSP, or for other accounts at Wells Fargo— do not apply to the Plan.

Note that your Designation of Beneficiary form becomes effective when it is received by the Plan. A form received after your death will not be honored, even if it is dated prior to your death.

You can change, add to, or update your beneficiary designation(s) at any time. You should periodically review your designation to be sure it still accurately reflects your wishes. You should also review and update your designation if you get married or divorced. If you get married, your spouse automatically becomes your beneficiary (even if you had previously submitted a Designation of Beneficiary form naming someone else—if you want to keep that other person as your beneficiary, you would have to file another Designation of Beneficiary form, this time with your new spouse’s written consent allowing the other beneficiary).

Your surviving spouse can choose to leave the money in the Plan until the year in which you would have turned 70 ½.

Otherwise, the full balance will be paid to your beneficiary(ies) or to your estate by the end of the calendar year after you die.

SEC Supplemental Retirement Plan Overview | February 2017 Page 12

While you’re still an SEC employee.

The type of account in which the Plan money is invested was carefully selected to meet the Plan’s needs (see p. 18).

While the anticipated return on investment is a competitive market rate for an account of this type, it is less than the return that could be expected from investments offered in other types of retirement plans (including the TSP).

Generally, federal tax laws do not permit employees to access retirement monies except in certain narrow circumstances. To help its employees get the maximum benefit from the Plan, the SEC elected to adopt all three of the basic exceptions. As a result, you can withdraw your (vested) money from the Plan even if you are still an SEC employee if any of the following three things is true:

1. If you are at least 59 ½ years old. If this is true, you can withdraw your entire account balance at any time, no matter how long the money has been in the Plan and no matter how long you have been a participant in the Plan.

2. If the money has been in the Plan for at least 2 years. You can only withdraw the amount that has been in the account at least 2 years (and associated earnings) – you cannot withdraw any amounts that have been in the account for less than 2 years.

3. If you have been a Plan participant for at least 5 years. If this is true, you can withdraw your entire account balance at any time, even if the money has been in the account for less than 2 years.

In-service withdrawals must be for $500 or more.

Each in-service withdrawal costs $35.

The SEC will pay for TWO withdrawals per calendar year. If you want to make additional withdrawals, the cost will be deducted from your Plan balance.

SEC Supplemental Retirement Plan Overview | February 2017 Page 13

Example*: Paul joined the SEC many years ago. He became a Plan participant as of January 1, 2015 and is immediately vested in his Plan balance. The SEC makes the following deposits to the Plan on his account:

Date Deposit Balance

01-Nov-15 $ 4,000 $ 4,000 22-Apr-16 $ 250 (biweekly) $ 4,250 06-May-16 $ 250 $ 4,500 20-May-16 $ 250 $ 4,750 05-Aug-16 $ 3,500 $ 9,500 12-Aug-16 $ 250 $ 9,750 24-Feb-17 $ 250 $ 13,250 10-Mar-17 $ 250 $ 13,500 27-Dec-19 $ 250 $ 31,750

* For simplicity, this set of examples assumes that Paul will always withdraw the maximum amount as soon as possible. After the first two withdrawals per calendar year, Paul would be charged for each withdrawal. This set of examples also ignores the fact that Paul may have had some earnings that could be withdrawn along with the related deposits.

Example 1a: Assume Paul is at least 59 ½ years old on November 1, 2015. He can immediately withdraw or transfer his entire Plan balance at any time.

Example 1b: Assume instead that Paul is exactly 58 ½ years old on November 1, 2015. Paul can withdraw or transfer his entire Plan balance beginning November 1, 2016.

SEC Supplemental Retirement Plan Overview | February 2017 Page 14

Example 1c: Assume instead that Paul will be 59 ½ years old on August 1, 2018. He can make the following withdrawals:

Date Beginning Balance Withdrawal Remaining

Balance

01-Nov-17 $ 17, 500 $ 4,000 $ 13,500 06-May-18 $ 17,000 $ 500 $ 16,500 03-Jun-18 $ 17,000 $ 500 $ 16,500 01-Jul-18 $ 17,000 $ 500 $ 16,500 29-Jul-18 $ 17,000 $ 500 $ 16,500 01-Aug-18 $ 17,000 $ 16,500 $ -0-

Until Paul is 59 ½ years old, each withdrawal is limited to the amount that has been in the Plan for two years (with a minimum withdrawal of $500). From August 1, 2018 forward, Paul can withdraw or transfer his entire Plan balance at any time because of his age.

SEC Supplemental Retirement Plan Overview | February 2017 Page 15

Example 1d: Assume instead that Paul is 40 years old on November 1, 2015. He can make the following withdrawals:

Date Beginning Balance Withdrawal Remaining

Balance

01-Nov-17 $ 17, 500 $ 4,000 $ 13,500 06-May-18 $ 17,000 $ 500 $ 16,500 03-Jun-18 $ 17,000 $ 500 $ 16,500 05-Aug-18 $ 16,500 $ 3,500 $ 13,000 26-Aug-18 $ 13,500 $ 500 $ 13,000 01-Jan-20 $ 13,500 $ 13,500 $ - 0 -

Until January 1, 2020, each withdrawal is limited to the amount that has been in the Plan for two years (with a minimum withdrawal of $500). On January 1, 2020, Paul will have been a participant in the Plan for five years.

From that day forward, Paul can withdraw or transfer his entire Plan balance at any time regardless of his age.

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ARE THERE TAX ISSUES I SHOULD CONSIDER?

The SEC’s contributions to the Plan, plus earnings on those contributions, are tax-deferred. This means that you do not pay tax on the contributions when they are made. You also do not pay tax on the interest or other earnings allocable to your account as long as the money remains in your Plan account.

The SEC cannot provide tax advice, and you should consult a tax advisor to discuss your particular situation. But in general:

If you have money from the Plan transferred directly to another qualified retirement plan (including the TSP) or an IRA, you will not have to pay tax on the withdrawal.

Instead of a direct transfer, you have the right to ask for a distribution directly to you. The law requires that 20% of the distribution amount be withheld for federal income tax, which will reduce the amount you receive. If you reinvest the money in an IRA, the TSP, or another qualified retirement account within 60 days then you will not actually owe the tax that was withheld—but you will not get that 20% back until you file your tax return (assuming you don’t owe any other taxes).

If you withdraw money from the Plan and use it to take a fantastic holiday cruise, you will have to pay tax on the withdrawal (and perhaps a penalty tax if you’re younger than 59 ½ as well – this money is supposed to be used for retirement, after all).

Once you are 70 ½ years old (approximately—see note 2, above), the law requires the Plan to distribute your balance to you. Those distributions are generally taxable – a tax advisor can help you plan for and navigate through those laws.

Tax Notice. WHENEVER YOU RECEIVE A DISTRIBUTION THAT IS AN ELIGIBLE ROLLOVER DISTRIBUTION, THE PLAN ADMINISTRATOR WILL DELIVER TO YOU A MORE DETAILED EXPLANATION

OF THESE OPTIONS. HOWEVER, THE RULES THAT DETERMINE WHETHER YOU QUALIFY FOR

FAVORABLE TAX TREATMENT ARE COMPLEX. YOU MAY WISH TO CONSULT WITH A QUALIFIED TAX

ADVISOR BEFORE MAKING A CHOICE.

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WHAT HAPPENS IF I LEAVE THE SEC, BUT COME BACK LATER?

1. When you terminate your SEC employment, you will permanently forfeit any amount in your account that was not vested. The SEC will use forfeited amounts to pay Plan expenses and to reduce the amount it would otherwise have to contribute to fund other employees’ accounts.

2. If you are later rehired and eligible to participate again, you will not receive credit for your prior SEC service for purposes of vesting and you will not have your forfeited account balance restored. You will get credit for your prior participation for purposes of the 5-year in-service withdrawal rule.

3. If you were vested, and your account balance was distributed to you, then your old account will be reactivated but any new contributions will be unvested (until you have served for three continuous years).

4. If you were vested, and your account balance was not distributed to you, then your account will show both your vested (old) and unvested (new) balances.

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OTHER IMPORTANT NOTES

How is the Plan money invested? The SEC, which regulates the securities markets, key securities market participants, and securities investments (whether labeled as such or not), directed the Trustee to hold the assets in a highly-secure vehicle that is not regulated by the SEC.

The Trustee is holding the Plan assets in a Collateralized Institutional Bank Deposit Account (CIBDA). The CIBDA is a deposit vehicle of Wells Fargo Bank, N.A., and is designed to preserve capital and provide a high level of liquidity. It will return a rate that is competitive with the rate for other similar accounts in the market. CIBDA deposits, including those of this Plan, are insured up to applicable limits established by the Federal Deposit Insurance Corporation (FDIC). Balances above the FDIC limits are collateralized in accordance with applicable federal regulations. Additional information about the CIBDA is available on the Wells Fargo website.

Will Plan expenses be deducted from my account balance? Generally, no. The SEC intends to pay for all costs related to the Plan except for excess in-service withdrawals (see p. 12).

The SEC will use amounts forfeited by employees who leave the SEC before their account has vested to reduce the amount it has to pay for Plan expenses. If there are forfeited amounts beyond those expenses, the SEC will use those to reduce the amount it would otherwise have to contribute to fund other employees’ accounts.

What if I think there is a mistake in my account? You will receive quarterly statements from Wells Fargo, and can also register to view your Plan account online at any time. It is your responsibility to notify the SEC of any errors within 30 days after the statement date by contacting the Office of Human Resources at SupplementalRetirement@sec.gov.

What happens if I move, get married / divorced, etc.? As long as you have a Plan account, you need to keep all your personal and contact information up-to-date. You can find all the forms you may need at www.WellsFargo.com.

http://www.wellsfargo.com/

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OTHER IMPORTANT NOTES (cont’d)

Can creditors take my Plan balance? As with tax questions, you may wish to obtain professional advice if you have this concern. But in general, no. You cannot sell, give away, or use your Plan account as collateral for a loan.

And your creditors—other than the federal government—cannot attach, garnish, or otherwise interfere with your Plan account. (The federal government can use your Plan account to enforce a federal tax lien or to collect a judgment resulting from an unpaid tax assessment.)

The main exception to this rule is a Qualified Domestic Relations Order (“QDRO”). A QDRO is issued by a court and obligates you to pay child support or alimony, or otherwise allocates a portion of your assets in the Plan to your spouse, former spouse, children, or other dependents. If a QDRO is received by the Plan, all or a portion of your benefits may be paid to other people (in most cases, to a former spouse), in accordance with the terms of the QDRO.

Can the SEC change the Plan? The SEC has the right to amend the Plan, or terminate it altogether, at any time. The SEC may also enter into collective bargaining agreements with the NTEU that impact the Plan. But in no event will any amendment or agreement cause any reduction in your Plan balance.

How do I request a direct transfer into the TSP? Call the Wells Fargo Institutional Retirement and Trust (WF-IRT) Retirement Service Center at 1-800-728-3123 and ask for a check to be issued on your behalf to “The Thrift Savings Plan FBO [Your Name]”. This ensures that the funds are designated as a direct rollover without any tax penalties to you. WF-IRT will mail the check directly to you.

While waiting for the check to arrive, complete Section I of Form TSP-60 (available at www.tsp.gov) and forward it to OHR at SupplementalRetirement@sec.gov. OHR will complete Section II and send the completed form back to you. Mail the check and the completed Form TSP-60 to the TSP Rollover and Transfer Processing Unit at the address listed in the Form TSP-60 Instructions.

How do I designate a Beneficiary? If you want to designate someone other than your spouse or estate to receive your Plan balance, you must file a Designation of Beneficiary form. (If you are married and want to designate someone other than your spouse as beneficiary, you will need your spouse’s written consent.) You can find the form at www.WellsFargo.com.

http://www.tsp.gov/ http://www.wellsfargo.com/

SEC Supplemental Retirement Plan Overview | February 2017 Page 20

OTHER IMPORTANT NOTES (cont’d)

What if there is a dispute? Although rare, disputes can arise—about whether an employee’s account is accurate, whether a QDRO is valid, who is the legal beneficiary, etc. If you have any questions or concerns, you should first try to resolve the matter with the Office of Human Resources at SupplementalRetirement@sec.gov. If that does not resolve the matter, then you must promptly submit a written claim to

SEC Supplemental Retirement Plan Administrator c/o Office of Human Resources 100 F Street NE Washington DC 20549-3990.

With a copy to SEC Office of the General Counsel 100 F Street NE Washington DC 20549-9612.

Claims will generally be resolved within 90 days. The Plan Administrator’s decision is final.

SEC Supplemental Retirement Plan Overview | February 2017 Page 21

WHAT IMPACT DOES MILITARY SERVICE HAVE ON MY PLAN RIGHTS AND BENEFITS?

If you are a veteran and are reemployed under the Uniformed Services Employment and Reemployment Rights Act of 1994 (“USERRA”), your qualified military service may entitle you to Plan rights and benefits that are more favorable than discussed above. For example, you may not immediately forfeit your unvested balance and your qualified military service may be considered service with the SEC for purposes of vesting.

In addition, if you are placed on active military duty that interrupts your SEC service, you may be able to maximize your Plan benefits even during your military service. Conversely, decisions you make—or fail to make—could limit your ability to benefit from the Plan.

Military service, including USERRA rights, is a complex area of the law. If you are, or may be, affected please contact the Office of Human Resources at SupplementalRetirement@sec.gov for information and planning assistance.