SOUTHEASTERN PENNSYLVANIA TRANSPORTATION AUTHORITY AGENDA

SOUTHEASTERN PENNSYLVANIA TRANSPORTATION AUTHORITYAGENDAREGULAR MEETINGTo Be Held At 3:00 PMDECEMBER 19, 20191234 Market Street, Mezzanine LevelPhiladelphia, PA1.Approval of Minutes of the Regular Board Meeting of November 21, 20192.Financial Report3.ResolutionsI.Pension Committee ReviewA.Termination of Alliance Bernstein, L.P. and Brandywine Global InvestmentManagement, LLC and Appointment of Vesper Capital Management as InvestmentManagers to the SEPTA Pension PlanII.Administration Committee ReviewA.Purchase from American International Group (AIG), Starr, AXA/XL and Beazleyof Cyber Liability InsuranceB.Purchase from American International Group (AIG) and Starr International Companyof Directors and Officers Liability InsuranceC.III.Award of Contract Pursuant to a Request for ProposalOperations Committee ReviewA.Lease by New Jersey Transit Corporation to SEPTA of a Portion of the TrentonStation Building Located at 72 South Clinton A venue in the City of Trenton, Mercer County,New Jersey

AgendaDecember 19, 20194.B.Authorization to Award Contracts for Various ProcurementsC.Award of Contracts for Sole Source ProcurementsD.Authorization to Execute AmendmentsReport of General ManagerI2

12/19/19R E S 0 L U T I 0 NreTERMINATION OF ALLIANCE BERNSTEIN, L.P. AND BRANDYWINE GLOBALINVESTMENT MANAGEMENT, LLC AND APPOINTMENT OF VESPER CAPITALMANAGEMENT AS INVESTMENT MANAGERS TO THE SEPTA PENSION PLANWHEREAS,on February 24,2011 the Pension Committee of theBoard revised the Statement of Investment Policy and Objectivesand Operating Guidelines("Policy Statement")which governs theinvestment of the funds of the pension plans of SEPTA; delines and investment return expectations for all investmentmanagers; cedures for the Pension Committee to utilize in its review ofthe performance of each investment manager; esecurities for the SEPTA Pension Plan; nvestmentportfolioofsecurities for the SEPTA pension plan; andPage 1 of 3Management,GlobalFixedLLCIncome

WHEREAS,February28,consultant,placeat the Pension Committee Meeting that was held anagreed,theWatchtoListpursuant to criteria outlined in the Policy Statement; andWHEREAS,meeting,PFM Advisorsthe arecommendedandtheandtheCommitteereviewed updated performance measuresBernstein and Brandywine sionmanagementCommittee,relevantagreementsand Brandywine; andPensionCommitteerepresentatives of Vesper Capital Management("Vesper")WHEREAS,Meeting,presented ge Cap Short-Term Reversal Index FunddatatoandothertheVesper("UTRNX"),and asa result of such presentation and after discussion of the meritsof the fund,agreedPFM Advisors recommended and the Pension spectitstoPage 2 of 3UTRNXtheIndexinvestmentFundofasanSEPTA' s

ension agreementwithAllianceInvestment Management,and appointsRESOLVED,ofSEPTA'sBernstein,LLC,thatL. lobaland the Board also hereby delegatesVesper Capital Management and its UTRNX Index Fundas a manager of SEPTA's erBernstein,L. P.Investment Management,LLCtothe Pension ii)theandallL.P.andto enter andywineinvestmentsGlobalapproved bytake such action necessary to fundSEPTA's investment with Vesper Capital Management; ein,Brandywine Global Investment Management, LLC;anauthorizesthatmayeffectuate this Resolution.Page 3 of 3benecessaryinto doto

12/19/19R E S 0 L U T I 0 NrePURCHASE FROM AMERICAN INTERNATIONAL GROUP (AIG), STARR,AXA/XL AND BEAZLEY OF CYBER LIABILITY INSURANCEWHEREAS, in today's hi-tech corporate environment, companiesare constantly faced with the threat of "Cyber Liability" whenconducting business online and receive, disseminate and/or storepersonal information on their computer database systems; lydisclosed by either unlawful act or mistake, the company could facelegal exposure for breaching individual privacy rights, infringingupon or misappropriating intellectual property or violating otherlaws; andWHEREAS, while SEPTA currently maintains data protection andsecurity protocols in order to protect against cyber-attacks andother unlawful access to personal information, occasionally it ansometimes be compromised and are insufficient to protect a companyagainst such intrusions; andWHEREAS,the purchase of Cyber Liability Insurance providesSEPTA with an additional level of protection in the event SEPTA'sPage 1 of 4

existing protocols are somehow breached and personal informationdisclosed; underwritten in four layers, the first with American InternationalGroup(AIG)providing 5millionofprimarycoveragewitha 100,000 per occurrence self-insured retention (SIR) at an annualpremiumof 95, 545;thesecondlayerwithStarrproviding 5million in coverage in excess of 5 million at an annual premium of 38, 218;thethirdlayerwithAXA/XLproviding 5millionincoverage in excess of 10 million at an annual premium of 39,000;and thefourth and finallayer with Beazley for 5 millionincoverage in excess of 15 million at an annual premium of 35,000,with each policy being for a one-year term effective December 31,2018, for a combined annual premium (including a 2,000 policy fee)of 209,763; andWHEREAS,Committeeduring(RMAC)the October2019Risk Management Advisoryrenewal strategy meeting,it was discussed thatAon maintain relationships with the incumbent carriers, given theopen matter of the 2019 keystroke skimmer incident; andWHEREAS, the total annual premium for the primary and excesscoverages quoted by AIG of 101, 958 wasoffered all the existing coverages; andPage 2 of 4the only premium that

WHEREAS, the best additional excess layers of coverages werequoted by(i)Starr for 5 million excess of 5 million,total annual premium of 45,881;of 10 million,for a(ii) AXA/XL for 5 million excessfor a total annual premium of 42,900; and (iii)Beazley for 5 million excess of 15 million, for a total annualpremium of 38,500; rimarycyber( i)layerbuyerextortion,of(ii)(iii) law enforcement nuitydate(iv) loss definitionamendment;and(vi)propertydamage and security failure definition amendment; andWHEREAS, the RMAC and Office of General Counsel requested thatthe General Manager recommend that the Board authorize SEPTA tobind(i)the primary layer of Cyber Liability Insurance in theamount of 5 million with AIG, and three 5 million excess layersof coverage with Starr, AXA/XL and Beazley, under such terms andconditions assetforth above and morefullydescribed in thepertinent staff summary, at a combined total annual program cost(including a 1,520 policy fee) not to exceed 230,759; andWHEREAS, the General Manager made the recommendation to rebyauthorizes SEPTA to renew and place Cyber Liability Insurance withPage 3 of 4

(i) American International Group(AIG)for 5 million in primarycoverage with a 100,000 per occurrence self-insured retention, atan annual premium not to exceed 101,958;(ii) Starr for 5 millionin coverage in excess of 5 million, at an annual premium not toexceed 45,881;(iii) AXA/XL for 5 million in coverage in excess 10 million, at an annual premium not to exceed 42,900; and (iv)Beazley for 5 million in coverage in excess of 15 million, at anannual premium not to exceed 38,500,not to exceed 230,759fourpoliciesfor a total annual premium(including a 1,520 policy fee),being forone-year termswith allcommencing December31,2019.FURTHER RESOLVED, that the Board hereby authorizes the GeneralManager or his designee and other appropriate officers to executeall documents, in form approved by the Office of General Counsel,and to do any and all other things as shall be necessary and properin order to effectuate the purpose of this Resolution.S/Corp/Resolutions/12-2019-Cyber Liability InsurancePage 4 of 4

12/19/19R E S 0 L U T I 0 NrePURCHASE FROM AMERICAN INTERNATIONAL GROUP (AIG) AND STARRINTERNATIONAL COMPANY OF DIRECTORS AND OFFICERS urancecurrentpoliciesdirectorswith Americanand Starr International CompanyDecember ll expire on2019, with expiring annual premiums of 181,370 and 67,700, respectively; andWHEREAS,of 10entity,one of the insurance policies is a primary dthewith SEPTA entity coverage subject to 5 millionsublimit; andWHEREAS,the other insurance policy is an excess layer of 10 million which covers directors and off cers; andWHEREAS,toinsurethe reason for the dual layer insurance program isthatBoard membersthecoverremainsaffordedtoundiluted by anythem individually and against SEPTA; andPage 1 of 4directors,claimsofficersbroughtandagainst

WHEREAS,bothlayersprovidecoverageerrors and omissions that could from any matter claimedBoardmemberssolelyduetotheir status or due to their official acts; andWHEREAS,duringtheOctober2019Management Advisory Committee( ch,marketingthe2017lastoffullrenewalmeetingit rketing effort had taken placeeffort)viaapproachingSompo, Chubb, CNA and Travelers)themarketfor SEPTA, the resultsof which were not favorable; andWHEREAS, AIG and Starr quoted coverages with the same termsand conditions as the expiring program,with(i)AIG offering apremium of 197,200 for the primary D&O layer which included aultadditionalpremiumofExtension"aggregate 10, 000;andendorsementlimits(ii)ofStarrwhich 1,000,000offeringapremium quote of 73,609 for the excess D&O layer; andWHEREAS,thatthestaff, with the concurrence of the RMAC,GeneralManagerrecommendthatSEPTA to purchase D&O liability insurancePage 2 of 4the(i)Boardrequestedauthorizefrom AIG a primary

layer ofexcept 10 million with afor 500, 000employmentself-insured retention ofpracticesliabilityself-insured retention);layerof msdescribed(which 200, 000willhaveafrom Starr an ; andWHEREAS,the General Manager made the recommendation to anBoardherebyInternationala primary layer of directors and officers liabilityintheamountof 10million;and(ii)fromStarrInternational Company an excess layer of directors and officersliability insurance in theamount of 10 million,terms effective December 31,thetermsandconditions2019,setforone-yearboth of which will be underfor rRESOLVED,policieswithInternationalEnhanced lExtension notannualtonotexceedexceedPage 3 of 4prepaidGroup 197, 200 10,000)premiums(AIG)(withandanand 73,609,

respectively,alongwitha 1,000policyfee,foratotalcombined annual premium of designeeSEPTA to execute all documents,of General stheofin form approved by the Officeand to do any and all other things as shallbe necessary and proper in order to effectuate the purpose ofthis d-Officers-Liability-InsurancePage 4 of 4

12/19/19R E S 0 L U T I 0 NreAWARD OF CONTRACTPURSUANT TO A REQUEST FOR romfirms wishing to propose; andWHEREAS, SEPTA staff has requested that the General Managerrecommend that the Board authorize the award of the contract tothefirmlistedbelowproposer in the areasbecausesaidfor which thefirmwasrequestthesuccessfulfor proposals wasissued; dauthorize the award of the contract.NOW,authorizesand theTHEREFORE,BESEPTA toawardITRESOLVED,subjectGeneral Manager totothattheexecute act,inform approved by the Office of General Counsel,subject to theconcurrence of the funding agencies,if required,and rPage 1 of 2meetingall

requirements of the terms and conditions of the relevant requestfor proposals,including the provision of any required cableDisadvantaged Business Enterprise (DBE) requirements:1.To TRI STAR Risk Enterprise inistrationforInc.,PersonalfortheInjuryto ensure compliance with regulatory reportingrequirements which will include claims and litigation managementservices,electronicfor SEPTA' sdataservices,formsandother materialsPIP claims in accordance with Pennsylvania Act VI,with services to be performed over a base term of three yearsscheduled to commence on April 1,optiontermstobeexercisedat2020,along with two one-yearSEPTA'ssoledescribed in the staff summary on this subject,discretion,asfor a contractamount not to exceed 1, 896, 726 for the base term and 658, 094for each renewal term,to exceed 3, 212, 914,for a total five-year contract amount notRequest for Proposals No.Personal Injury Protection (PIP) Page 2 of 219-00115-ARLW -