Powers and Duties of the Board of Trustees and the Director of the Government of Guam

Retirement System in the Administration of the Deferred Compensation Program.

(a)Adoption of Formal Written Plan and Trust Arrangement. The Board of Trustees shall be responsible for the adoption of a formal written plan setting forth all the terms and conditions of the Program, and any plan amendments which from time to time the Board of Trustees shall determine to be required, in order that the Plan shall comply with and remain in compliance with Code § 457. The Board of Trustees, on behalf of the Government of Guam and all of its Employers, shall be authorized and empowered to take any and all required action, including, but not limited to, entering into annuity contracts, trust agreements and custodial arrangements, all of which shall be intended to satisfy the requirements of Code § 457(g) or to implement the Program.

(b)Exclusive Jurisdiction. The Board of Trustees shall have exclusive original jurisdiction in all matters relating to or affecting the Program, including, but not limited to, claims for benefits and refunds under this Article.

(c)Approval of Rules, Regulations and Administrative Procedures. The Board of Trustees shall consent to and approve such rules, regulations, administrative procedures and prescribed forms as established by the Director, as it may deem necessary to effectuate the purposes of this Article, all of which shall conform to Code § 457, Federal tax laws, U.S. Treasury Regulations, and rulings.

(d)Administrative Contracts. The Board of Trustees may contract with insurance, annuity, mutual fund, trust company or other qualified company or companies to administer the operations of the Program. In addition, the Board of Trustees shall also be authorized and empowered to take any and all additional actions, including, but not limited to, the execution of custodial, record keeping, and investment advisory agreements in order to implement the Program. CH. 8 RETIREMENT OF PUBLIC EMPLOYEES

(e)Investments. The Board of Trustees may solicit bids for investment options and may retain consulting services to assist it in soliciting and evaluating bids and in the periodic review of companies offering investment options.

(1)The Board of Trustees may annually establish a budget for its costs in the soliciting, evaluating and periodic review process of companies offering investment options, and may charge a proportional share of all costs related to the periodic review to each such company currently under contract and charge a proportional share of all costs related to soliciting and evaluating bids to each such company offering investment options which is selected by the Board of Trustees.

(A)Contracts must provide that any investment options are offered to members in an unbiased manner, in a manner that conforms to rules adopted by the Director, and without unreasonable solicitation.

(B)The contract must not permit any person to jeopardize the tax-deferred status of money invested by members under this Article.

(2)The Board of Trustees shall invest and reinvest the monies of the Program and manage the assets and income of the Program:

(A)solely in the interest of, and for the exclusive purposes of providing benefits to, members and their beneficiaries, and defraying reasonable expenses of administering the Program;

(B)with the care, skill, prudence and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with these matters would use in the conduct of an enterprise of a like character and with like aims; and

(C)in a manner that diversifies the investments of the Program as to minimize the risk of loss and to maximize the rate of return, unless under the circumstances prudent not to do so.

(3)Notwithstanding any other provision of this Article, and except as otherwise expressly restricted by the Organic Act of Guam and by the law, the Board of Trustees may delegate its authority to invest and/or manage the assets and income of the Program, provided that the Board of Trustees shall exercise reasonable care, skill and caution in:

(A)selecting an agent;

(B)establishing the scope and terms of the delegation, consistent with the purposes and terms of the Program; and

(C)periodically reviewing the agent’s performance and compliance with the terms of the delegation.

(f)Member Accounts. The Board of Trustees shall establish an individual account(s) for each Member, to which his or her respective contributions, together with all earnings on investments shall be deposited, and from which his or her respective benefits under this Program and his or her respective pro-rata share of reasonable administrative fees and expenses, as authorized by the Board of Trustees, shall be paid.

(g)Advisors. The Board of Trustees may engage actuarial, legal, clerical and all other advisors, including, but not limited to, a Qualified Custodian as described by § 8301(g) of this Article, as may be necessary to effectuate the purposes of this Article.

(h)Duties of Employer. The Board of Trustees shall confirm that all duties under this Article of each employer are being performed and, in the event that an employer fails to perform any duty imposed on said employer under the provisions of this Article, to take such steps as in its judgment seem advisable to enforce compliance by the employer with the provisions of this Article. CH. 8 RETIREMENT OF PUBLIC EMPLOYEES

(i)Supervised Contributions. The Board of Trustees shall confirm that all member contributions by way of salary deductions are remitted to the appropriate Qualified Custodian of the Program, and shall certify to each employer the amount to be deducted from each member’s salary.

(j)Records. The Board of Trustees shall cause to be maintained adequate accounting records that reflect the financial condition of the Program, and such additional data as is necessary or required for the operation of the Program.