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City of San Leandro Post-Retirement Healthcare Plan Investment Guidelines Document – HighMark Capital Management, Inc. (v. 7/20/2021 - RY) 3 Investment Authority: Except as otherwise noted, the Trustee, US Bank, has delegated investment authority to HighMark Capital Management, an SEC-registered investment adviser. Investment Manager has full investment discretion over the managed assets in the account. Investment Manager is authorized to purchase, sell, exchange, invest, reinvest and manage the designated assets held in the account, all in accordance with account’s investment objectives, without prior approval or subsequent approval of any other party(ies). Investment Objectives and Constraints The goal of the Plan’s investment program is to generate adequate long-term returns that, when combined with contributions, will result in sufficient assets to pay the present and future obligations of the Plan. The following objectives are intended to assist in achieving this goal:  The Plan should earn, on a long-term average basis, a rate of return equal to or in excess of the target rate of return of 5.25%.  The Plan should seek to earn a return in excess of its policy benchmark over the long- term.  The Plan’s assets will be managed on a total return basis which takes into consideration both investment income and capital appreciation. While the Plan Sponsor recognizes the importance of preservation of capital, it also adheres to the principle that varying degrees of investment risk are generally rewarded with compensating returns. To achieve these objectives, the Plan Sponsor allocates its assets (asset allocation) with a strategic, long- term perspective of the capital markets. Investment Time Horizon: Long-term Anticipated Cash Flows: Distributions are expected to be low in the early years of the Plan Target Rate of Return: 5.25% annual target Investment Objective: The primary objective is to maximize total Plan return, subject to the risk and quality constraints set forth herein. The investment objective the Plan Sponsor has selected is the Moderately Conservative Objective, which seeks to provide current income and moderate capital appreciation. The major portion of the assets are committed to income-producing securities. Market fluctuations should be expected. Risk Tolerance: Moderately Conservative The account’s risk tolerance has been rated moderately conservative, which demonstrates that the account can accept modest price fluctuations to pursue its investment objectives.