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HomeMy WebLinkAboutAgenda Fire Pension 021108THE PENSION RESOURCE CENTER, INC. 4360 Northlake Boulevard, Suite 206 ❖ Palm Beach Gardens, FL 33410 Phone (561) 624 -3277 ❖ Fax (561) 624 -3278 ❖ WWW.RESOURCECENTERS.COM PALM BEACH GARDENS FIREFIGHTERS' PENSION FUND Meeting of Monday, February 11, 2008 Location: Council Chambers, Palm Beach Gardens City Hall 10500 North Military Trail Palm Beach Gardens, FL 33410 Time: 10:00 A.M. AGENDA 1. Call Meeting to Order 2. Minutes of Meeting Held November 26, 2007 3. Annual Audit: Steve Gordon 4. Investment Monitor Report: Bogdahn Consulting • Quarterly Report • Revised Investment Policy Statement 5. Attorney Report: Bob Sugarman Fee Agreement for Legal Services 6. Administrative Report: Margie Adcock 7. Disbursements 8. Other Business 9. Schedule Next Meeting: Monday, April 21, 2008 at 10:00 A.M. 10.Adjourn PLEASE NOTE: Should any interested party seek to appeal any decision made by the Board with respect to any matter considered at such meeting or hearing, he will need a record of the proceedings, and for such purpose he may need to insure that a verbatim record of the proceedings is made, which record includes the testimony and evidence upon which the appeal is to be based. In accordance with the Americans With Disabilities Act of 1990, persons needing a special accommodation to participate in this meeting should contact The Pension Resource Center, Inc. no later than four days prior to the meeting. PALM BEACH GARDENS FIREFIGHTERS' PENSION FUND MINUTES OF MEETING HELD November 26, 2007 A meeting of the Board of Trustees was called to order at 9:30 A.M. at Station 3, Palm Beach Gardens, Florida. Those persons present were: TRUSTEES Ed Morejon Rick Rhodes Tom Murphy Steve Rogers Richard Hitchins MINUTES OTHERS Margie Adcock, Administrator Ken Harrison, Attorney Dave West, Investment Monitor Mike Dana, Investment Manager The Board reviewed the minutes of the meeting held September 24, 2007. A motion was made, seconded and carried 5 -0 to accept the minutes of the meeting held September 24, 2007. INVESTMENT MANAGER REPORT: DANA INVESTMENT ADVISORS Mike Dana appeared before the Board. He discussed the market environment, including the sub prime issues. The positive aspects of the market right now are that consumers are still spending; the international economy is where everyone is invested in; and the unemployment levels are low. He stated that this is a down market, but not a recession. He stated that there is a concern about inflation down the road. He stated that he thinks equities will do pretty well relative to the bond market. He stated that they need to be careful where they go in the bond market right now. Mr. Dana stated that they had a horrible 3`d Quarter. They have since turned that around and are ahead of the benchmark right now. He stated that they usually shine in a down market and that is what they are doing right now. Mr. Dana reviewed the performance of the portfolio. The total market value of the portfolio as of September 30, 2007 was $16,517,799. The total portfolio was down .08% for the quarter while the benchmark was up 1.97 %. Since inception, the portfolio was up 7.88% while the benchmark was up 7.61 %. The equity portion of the portfolio was down .84% for the quarter while the benchmark was up 1.55 %. The fixed income portion of the portfolio was up 2.27% for the quarter while the benchmark was up 2.87 %. The asset allocation as of September 30, 2007 was 65% in equities; 19% in bonds; and 16% in cash. Mr. Dana reviewed the treasury yield curve. The Board asked if there were any securities in the portfolio that the Board should be concerned about. Mr. Dana responded in the negative. It was noted that Dana had investments in Merrill Lynch as of September 30, 2007. Mr. Dana stated that he thought they sold out of that investment. Mr. Harrison stated that there is a class action against Merrill Lynch. Mr. West stated that they do not want to micro - manage or direct the Manager on what to invest in. He stated that Dana could continue to invest in Merrill Lynch if Dana thinks that is the best investment. The Board could still continue to participate in the class action as well. 2 Mr. Dana reviewed the asset allocation. As of September 30, 2007 the asset allocation was 54% in large cap equities; 12% in small cap equities; 17% bonds; 2% in ARMS; and 15% in cash. He reviewed the large cap and small cap sector distribution as of September 30, 2007. INVESTMENT MONITOR REPORT Dave West appeared before the Board. He discussed the investment performance for the quarter ending September 30, 2007. The Fund was up .43% for the quarter while the benchmark was up 2.04 %. For the fiscal year the Fund was up 10.88% and beat the actuarial assumption. The benchmark for that same time period was 13.45% and that was the first time that the performance of the Fund fell below the benchmark. The total market value of the Fund as of September 30, 2007 was $22,444,000. The asset allocation at market was 48% in equities; 28% in fixed income; 5% in REIT; 8% in international; and 11% in cash. The total market value of the equity portfolio was $12,555,000. Equities for the quarter were down .96% while the benchmark was up 1.66 %. The equity portfolio managed by Dana was down .94% for the quarter while the benchmark was up 1.55 %. The total market value of the equity portfolio managed by Dana was $10,803,000. The fixed income portfolio managed by Dana was up 2.22% for the quarter while the benchmark was up 2.88 %. The total market value of the fixed income portfolio managed by Dana was $3,158,000. There was a very lengthy discussion on the performance of Dana with respect to the fixed income portion of the portfolio. Mr. West stated that he would monitor Dana very closely. He recommended elevating the level of probation. He needs to see the strategy work out at least hopefully within the next quarter, but certainly within the next two quarters. Mr. West reviewed the history and philosophy of Board when they originally hired Dana fixed income in June 2002. He stated that the Board has to decide if the bond product is still consistent with the overall philosophy of the Board given that other strategies are now available, as the Fund has grown in size. Mr. West stated that there appears to be a philosophical shift on the part of the Board to maybe not stay with a preservation process but rather focus on the total return. Additionally, there seems to be a re- emerging dependence on duration when Mr. West thought there was going to be a movement away from that. The fixed income portfolio managed by Galliard was up 2.94% for the quarter while the benchmark was up 2.79 %. The total market value of the fixed income portfolio managed by Galliard was $3,088,000. The international equities managed by Voyageur Asset Management were down 1.13% for the quarter while the benchmark was up 2.23 %. The total market value of the international equity portfolio was $1,752,000. The REIT portfolio was up 4.42% for the quarter while the benchmark was up 3.00 %. The total market value of the REIT portfolio was $1,086,000. Mr. West discussed the Investment Policy Statement. The only thing that is changing is Schedule A. Mike Dana departed the meeting. Richard Hitchins departed the meeting. 3 ATTORNEY REPORT Mr. Harrison discussed again the law that was passed that required the State, not municipalities, to divest security holdings in Iran and Sudan. He stated that they sent a letter to the investment managers asking them to identify any companies that the managers are invested in with regard to security holdings in Iran and Sudan. He advised that they received confirmation from all of the managers that they do not have any holdings as set forth in the report where the State identified certain prohibited securities in Iran and Sudan. Mr. Harrison stated that he was willing to discuss their proposal for increasing the fee for legal services. Ms. Adcock provided the Board with a list of five pension attorneys and the hourly rates that each would charge the Fund as was requested at the last meeting. There was a lengthy discussion. A motion was made and seconded for discussion to approve an hourly rate with the law firm of Sugarman & Susskind of $285 for three years. There was discussion of a retainer. Mr. Harrison stated that they do not really compete with three of the firms on the list. He stated that they really only compare themselves to Klausner & Kaufman. The motion was withdrawn. A motion was made and seconded for discussion to enter into a retainer with Sugarman & Susskind if the Board can negotiate a better retainer fee and hourly rates outside of the retainer for three years. There was further discussion. The motion was withdrawn. A motion was made, seconded and carried 4 -0 to approve an hourly rate with the law firm of Sugarman & Susskind of $285 for three years. The Board requested that Mr. Harrison discuss with Mr. Sugarman the possibility of a retainer of $2,500 a month with a two -year guarantee. ADMINISTRATIVE REPORT Ms. Adcock presented the list of disbursements to be made. She noted that there was an additional disbursement for the Attorney for October in the amount of $450.00. A motion was made, seconded and carried 4 -0 to approve the disbursements listed and include the disbursement for the Attorney for October. OTHER BUSINESS It was noted that at the last meeting the Board decided to change from monthly meetings to bi- monthly meetings. The Board scheduled the meetings for 2008 as follows: February 11; April 21; June 16; August 18; October 20; and November 17. The meetings would start at 10:00 A.M. and be held in the City Council Chambers. There being no further business, the meeting adjourned. Respectfully submitted, Tom Murphy, Secretary f BOGDAHN CONSULTING LLC, simplifying your investment decisions January 14, 2008 Mr. Charles Slavin, Actuary Division of Retirement Municipal Police Officers' and Firefighters' Retirement Trust Fund P.O. Box 3010 Tallahassee, FL 32315 -3010 Dear Mr. Slavin: The Board of Trustees of the Palm Beach Gardens Firefighters' Pension Trust Fund recently revised their Investment Policy Statement. Attached please find a copy for your files. Sincerely, Dave West Consultant cc: Margie Adcock, Trust Fund Administrator Sugarman & Suskin, Attorney Gabriel, Roeder & Smith, Actuary 340 West Central Avenue • Suite 300 • Winter Haven, Florida 33880 Telephone (863) 293 -8289 • Facsimile (863) 292 -8717 s- City of Palm Beach Gardens (Plan Sponsor) Firefighters' Pension Trust Fund Investment Policy Statement 1. PURPOSE OF INVESTMF,NT POLICY" STATEMENT The Pension Board of Trustees. as named fiduciaries maintains that an important determinant of future investment returns is the expression and periodic review of the Fund's investment objectives. To that end. the Trustees have adopted this statement of Investment Policy and direct that it apply to all assets under their control. . In fulfilling their fiduciary responsibility, the Trustees recognize that the Pension Plan is an essential vehicle for providing income benefits to retired participants or their beneficiaries. The Board also recognizes that the obligations of the Fund are long -term and that investment policy should be made with a view toward performance and return over a number of years. The general investment obiective, then, is to obtain a reasonable total rate of return - defined as interest and dividend income plus realized and unrealized capital gains or losses - commensurate with the Prudent Investor Rule and any other applicable statute. Reasonable consistency of return and protection of assets against the inroads of inflation are paramount. However. the volatility of interest rates and securities markets make it necessary to judge results within the context of several years rather than over short periods of two years or less. The Pension Board of' "trustees will employ professional Investment Management firms to invest the assets of the fund. Within the parameters allowed in this IPS, the Investment Managers have full discretion. including security selection, sector weightings and investment style. The Trustees. in performing their investment duties shall comply with the fiduciary standards set forth in Employee Retirement Income Security Act of' 1 Q74 (ERISA) at 29 U.S.C. s. 1104(a) (1) (A) -- (C). In case of conflict xvith other provisions of law authorizing investments, the investment and fiduciary standards set forth in this section shall prevail. ADOPTED: 8-20-200-7 IL TARGET ALLOCATIONS In order to provide for a diversified portfolio. the Board has engaged investment Management firms with target investment allocations as provided for on Schedule A. attached hereto. The manager's are solely responsible for the assets and allocation of their mandate only and shall abide by any subordinate investment policy assigned to the manager attached hereto. On a regular bias (at least quarterly) the investment Consultant will review the investment portfolio for the purpose of rebalancing assets within the target investment allocations prescribed on Schedule A, and shall coordinate the overall asset allocation and affect rebalancing of the portfolio when necessary. The consultant shall also periodically review the investment portfolio and'report to the Board the style and capitalization of the individual and total portfolios. III. INVESTMENT PERFORMANCE OBJECTIVES The following performance measures will he used as objective criteria for evaluating effectiveness of the investment managers. A. Total Fund Performance I . The performance of the total Fund will be measured for rolling three and five year periods. These periods are considered sufficient to accommodate the market cycles experienced with investments. The performance of this portfolio will be compared to the return of a portfolio comprised of 551111'0 Russell 3000. 10`%0 MSCI SAFE, and 30% Lehman Brothers intermediate Aggregate Bond Index, and 5% of the 90 day U.S. Treasury Bill Index. 2. On a relative basis, it is expected that the total fund performance will be in the top 40% of the Appropriate peer Universe over three to five -year periods. 3. On an absolute basis, it is expected that total return of the combined equity, fixed income, and cash portfolio, will equal or exceed the actuarial earnings assumption (8.25 and equal or exceed the Consumer Price Index plus 1 0 over three to five year periods. B. Equity Performance The combined equity portion of the portfolio, defined as common stocks and convertible bonds, is expected to perform at a rate at least equal to the S &P 500 Index. Individual components of the equity portfolio will be compared as outlined in Schedule A. All portfolios are expected to perform in the top 401/o of an appropriate peer universe. C. Fixed Income Performance The overall objective of the fixed income portion of the portfolio is to add stability, consistency and safety to the total find. The fixed income portion of the portfolio, defined as fixed income and preferred stocks, is expected to perform at a rate at least equal to the Lehman Brothers Intermediate Aggregate Bond Index. and in the top 40% of the appropriate peer universe. D. Alternatives (Real Estate / Timber) ADOPTED: 8-20-2007' The overall objective of the alternative portion of the portfolio is to provide an attractive level of income with minimal volatility to the fund. This portion of the fund is expected to provide an absolute rate of return as benchmarked in Schedule A attached hereto. 1V. INVESTMENT GUIDELINES A. Authorized Investments Other than with commingled finds as ma\ made or held in the fund shall be limited to: be approved by the board. all investments Time or savings accounts of a national bank, a state bank insured by the Bank Insurance Fund, or a savings and loan association insured by the Savings Association Insurance Fund which is administered by the Federal Deposit Insurance Corporation or a state or federal chartered credit union whose share accounts are insured by the National Credit Union Share Insurance Fund. 2. Bonds issued by the Sate of Israel. Obligations issued by the United States Government or obligations guaranteed as to principal and interest by the United States Government or by an agency of the United States Government. 4. Stocks, commingled funds administered by national or state banks. mutual funds and bonds or other evidences of indebtedness. issued or guaranteed by a corporation organized under the laws of the United States. any state or organized territory of the United States or the District of Columbia. J. Commingled fixed income vehicles which may include Asset- backed securities, caps, floors, options, collective funds, corporate notes, bonds, debentures, and bank credit or loan participation agreements. federal apency securities /or other debts or loans backed by U.S. Govt. Agencies, federal funds. forward agreements /dollar rolls, financial futures, swaps, money market instruments, mortgage- backed securities, mortgage pass - throughs, mutual funds (which incorporate investments listed above), municipal securities, private placements /144A, repurchase agreements, treasury notes, bonds and bills /or other debts or loans guaranteed by the U.S. Treasury, fixed & variable preferreds /hybrids, other illiquid securities with exposure not to exceed 2% of the Fund assets; provided that: a. The securities when purchased meet the follovying ranking criteria: i. Fixed Income: a. Investment Grade as measured by Standard & Poor's or Moody's. b. Portfolio duration shall not exceed + or — 25 of the manager benchmark assignment per schedule A accompanying this Policy Statement. ii. Equities: Traded on a national exchange. iii. Money Market: Standard & Poor's A 1 or Moody's P 1. iv. Real Estate: Commingled private placements and direct investments must be independently appraised annually. AT)OPTF,D: X -20 -200' 3 b. Not more than Y °1� of the Fund's assets shall be invested in the common stock or capital stock of any one issuing company, nor shall the aggregate investment in any one issuing company exceed 3" 40 of the outstanding capital stock of the company. c. The value of bonds issued by an% single corporation shall not exceed 3`''o of the total fund. 6. Real Estate 7. Foreign Securities. to include fixed income and equity securities. B. Limitations 1. Investments in corporate common stock and convertible bonds shall not exceed 65% of the Fund assets at cost or 75% of the fund assets at market value. 2. Foreign securities shall not exceed 1 f ► "'o of the value at cost of the fund. 3. Real estate investments shall not exceed 10 "0 of the value at cost of the fund. 4. No investment may be made unless provided for as part of this policy U. Tradine Parameters When feasible and appropriate, all securities shall be competitively bid. Except as otherwise required by law, the most economically advantageous bid shall be selected. Commissions paid for purchase of' securities must meet the prevailing best- execution rates. The responsibility of monitoring best price and execution of trades placed by each manager on behalf of the Plan will he governed by the Portfolio Management Agreement between the Plan and the Investment Managers. V. COMMUNICATIONS A. On a monthly basis, the custodian shall supply an accounting statement that will include a summary of all receipts and disbursements and the cost and the market value of all assets. On a quarterly basis, the managers shall provide a written report affirming compliance with the security restrictions of' Section iV above and a summary of common stock diversification and attendant schedules. In addition. the manager shall deliver each quarter a report detailing the F'und's perfonnance. adherence to the investment policy, forecast of the market and economy. portfolio analysis and current assets of the Trust. Written reports shall be delivered to the `trustees within 60 days of the end of the quarter. A copy of the written report shall be submitted to the person designated by the City, and shall be available for public inspection. The Investment Managers will provide immediate written and telephone notice to the Trustees of any significant market related or non - market related event. specifically including. but not limited to, any deviation from the standards set forth in Section 1V above. B. The Investment Managers will disclose any securities that do not comply with section IV in each quarterly report. C. If the Fund owns investments, that complied with section IV at the time of purchase, which subsequently exceed the applicable limit or do not satisfy the applicable investment standard, such excess shall result in rebalancing within 30 days; noncompliant investments shall be disposed of at the earliest economically feasible opportunity in ADOPTED: 8 -20 -2007 4 accordance with the prudent man standard of care. but shall not exceed two (2) fiscal quarters and no additional investment may be made. Assets for which a fair market value is not provided shall he excluded from the assets used in the determination of annual funding cost. For each actuarial valuation, the board must verif}- the determination of the fair market value for those investments and ascertain that the determination complies with all applicable state and federal requirements. The board shall disclose to the Department of Management Services and the Plan's sponsor each such investment for which the fair market value is not provided. D. The Trustees shall retain a monitoring service to evaluate and report on a quarterly basis the rate of return and relative performance of the Fund. The Trustees will meet quarterly to review the monitoring service's Performance Report. The Trustees will meet with the investment manager and appropriate outside consultants to discuss performance results, economic outlook. investment strategy and tactics and other pertinent matters affecting the Fund on a periodic basis. E. At least annually, the Trustees shall provide the investment Managers with projected disbursement needs of the plan, so that the investment portfolio can be structured in such manner as to provide sufficient liquidity to pay obligations as they come due. To this end, the Investment Managers should, to the extent possible, attempt to match investment maturities with known cash needs and anticipated cash -flow requirements. Vl. COMPLIANCE A. It is the direction of the Trustees that the plan assets are held by a third party custodian, and that all securities purchased by, and all collateral obtained by, the plan shall be properly designated as plan assets. No withdrawal of assets, in whole or in part, shall be made from safekeeping except by an authorized member of the board of Trustees or their designee. Securities transactions between a broker - dealer and the custodian involving purchase or sale of securities by transfer of money or securities must be made on a "delivery vs. payment" basis to insure that the custodian will have the security or money in hand at conclusion of the transaction. Provided that all approved vendors transacting repurchase agreements perform as stated in any feaster Repurchase Agreement B. At the direction of the Trustees, operations of the fund shall he reviewed by independent certified public accountants, as part of any financial audit periodically required. Compliance with the Trustees" internal controls shall be verified. "These controls have been designed to prevent losses of funds that might arise from fraud, error, or misrepresentation by third parties or imprudent actions by the Board or employees of the plan sponsor, to the extent possible. C. Each member of the Board of' Trustees shall participate in a continuing education program relating to investments and the Trustee's responsibilities to the fund. It is highly suggested that this education process begin during the Trustees first term. D. With each actuarial valuation, the Board of Trustees shall determine the total expected annual rate of return for the current year. for each of' the next several years and for the long term thereafter. This determination shall he tiled promptly xvith the Department of Management Services. the plan's sponsor and the consulting actuary. ADOPTED: 8 -10 -200' 5 F.. The proxy votes must be exercised for the exclusive benefit of the participants of the Fund. Each manager shall provide the Board \vith a cope of their proxy voting policy for approval. On a regular basis, at least allnuady. each manager shall report a record of their proxy vote. VIi. CRITERIA FOR INVESTMENT MANAGER REVIEW The Board wishes to adopt standards by which iudgments of the ongoing performance of a portfolio manager may be made. fly. at ,111 \" llllle. iall�' one of the following, is breached. the portfolio manager will be warned of t:hc hoard's serious concern: A. lour consecutive quarters of total l''1 :nd pertOrnlancc below the 50th percentile in manager performance rankings. 13. Standard deviation for a fund component in excess of 150°10 of the assigned benchmark" C. !.oss by the nlanager of any senior investnlenl personnel. D) Any change in basic investment philosophy hN the manager. 1.. Failure to attain a 60(1,x, vote of confidence h\- the 13oa1•d of "I "rustees. l". Failure to Observe the security duality restrictions of, section f�'. Nothing in this section shall limit or dilmnish the "I'rustees' right to terminate the manager at any time for any reason. VIII. FLORIDA STATUTES 112,175 AND APPLICABLE CiTY ORDINANCES If. at any time, this document is found to be in conflict with Chapter 112 or 175 Florida Statutes. or the applicable City Ordinances, the Statutes and Ordinances shall prevail. IX. REVIEW AND AMENDMENTS it is the T- rustces intention to review this document at least annually subsequent to the actuarial report and to amend this statement to reflect ally changes in philosophy. objectives. or guidelines. Any investment not specifically allowed as part of this policy is prohibited. If; at any time, the hivestnicllt Manager tccts that the specific objectives defined herein cannot be met, or the guidelines constrict performance, the Trustees Should be notified in \vriting. By iniflai and continuing acceptance of this Investment Policy Statement, the investment Managers concur With the provisions of this document. CITY OF PALM BEACH GARDENS FIREFIGHTERS' PENSION PLAN t.'hairniail. . 04 l "l I'ilsteeS - - -- 1 ADOPTED: 8-20-200- 6 r ~'I � V L �n1 a n• W f LwL II\/ I� Gz. � I C w CIO ;v .0 C Q . *4 , -\ w E \ h E, L t; 1 o. C w � v rn ' J I-- f N �.J Z p w :J C t— �c o 0 0 0 o ice, cs l In � 'y ICI c� O U r. nJ • ~ .v C WMM C, W ^ "r• kr1 O � iii O O N l' J Vl Q C: O i r a� O Vim! W cu d CZ cz z m ca =s Q QQiC7QQ t�t � � o» • ICI � �' � � � C •`rte„ o c cu N , y vi � V COD p u o _O _C > > U s r ~'I � V L �n1 a n• W f LwL II\/ I� Gz. � I C w CIO ;v .0 C Q . *4 , -\ w E \ h E, L t; 1 o. C w � v rn ' J I-- Robert A. Sugarman* Howard S. Susskind Kenneth R. Harrison, Sr. Noah S. Warman D. Marcus Braswell, Jr. Pedro A. Herrera Ivelisse Berio LeBeau *Board Certified labor & Employment Lawyer SUGARMAN & SUSSKIND PROFESSIONAL ASSOCIATION ATTORNEYS AT LAW December 10, 2007 Board of Trustees City of Palm Beach Gardens Firefighters' Pension Fund c/o Margaret M. Adcock, Administrator The Pension Resource Center 4360 Northlake Boulevard, Suite 206 Palm Beach Gardens, FL 33410 Re: City of Palm Beach Gardens Firefighters' Pension Trust Fund Dear Trustees: 100 Miracle Mile Suite 300 Coral Gables, Florida 33134 (305) 529 -2801 Broward 327 -2878 Toll Free 1- 800 - 329 -2122 Facsimile (305) 447 -8115 Thank you for continuing to retain our firm. We look forward to continuing to work with you for the benefit of the Pension Fund, the trustees, the participants and their beneficiaries. This is to confirm the terms of our Fee Agreement. Our services will be provided at the hourly fee of $285.00, commencing January 1, 2008. This fee arrangement shall remain in effect through December 31 2010, at which time our fees may be reviewed and the fee adjusted, although you have the right to discharge us as your attorneys at any time. We also bill for out -of- pocket costs, such as computerized legal research; special postage (such as certified mail); long distance telephone calls, (we have a 800 number so there will be no cost for calling us); travel expenses; filing fees, and court reporter's fees. Travel time will be prorated among other clients meeting on the same date in the area. Board of Trustees City of Palm Beach Gardens Firefighters' Pension Fund December 10, 2007 Page 2 To indicate your agreement to this agreement, please sign the two original copies of this letter as indicated and return one copy to our office. RAS /jd Enclosure Yours truly, ROBERT A. SUGARMAN WE HEREBY AGREE to the terms and conditions set forth in the aforementioned fee arrangement. LIM ACCEPTED ON BEHALF OF THE CITY OF PALM BEACH GARDENS FIREFIGHTERS' PENSION FUND Chairperson Print Name: Date: SUGARMAN & SUSSKIND PROFESSIONAL ASSOCIATION ATTORNEYS AT LAW Robert A. Sugarman Howard S. Susskind Kenneth R. Harrison, Sr. Noah S. Warman D. Marcus Braswell, Jr. Pedro A. Herrera Ivelisse Berio LeBeau ♦ Board Certified Labor & Employment Lawyer December 10, 2007 Board of Trustees City of Palm Beach Gardens Firefighters' Pension Fund c/o Margaret M. Adcock, Administrator The Pension Resource Center 4360 Northlake Boulevard, Suite 206 Palm Beach Gardens, FL 33410 Re: City of Palm Beach Gardens Firefighters' Pension Trust Fund Dear Trustees: 100 Miracle Mile Suite 300 Coral Gables, Florida 33134 (305) 529 -2801 Broward 327 -2878 Toll Free 1- 800 -329 -2122 Facsimile (305) 447 -8115 Thank you for continuing to retain our firm. We look forward to continuing to work with you for the benefit of the Pension Fund, the trustees, the participants and their beneficiaries. This is to confirm the terms of our Fee Agreement. Our services will be provided at the hourly fee of $285.00, commencing January 1, 2008. This fee arrangement shall remain in effect through December 31 2010, at which time our fees may be reviewed and the fee adjusted, although you have the right to discharge us as your attorneys at any tim. We also bill for out -of- pocket costs, such as computerized legal research; special postage (such as certified mail); long distance telephone calls, (we have a 800 number so there will be no cost for calling us); travel expenses; filing fees, and court reporter's fees. Travel time will be prorated among other clients meeting on the same date in the area. Board of Trustees City of Palm Beach Gardens Firefighters' Pension Fund December 10, 2007 Page 2 To indicate your agreement to this agreement, please sign the two original copies of this letter as indicated and return one copy to our office. RAS /jd Enclosure Yours truly, ROBERT A. SUGARMAN * * * * * * * * * * ** WE HEREBY AGREE to the terms and conditions set forth in the aforementioned fee arrangement. ACCEPTED ON BEHALF OF THE CITY OF PALM BEACH GARDENS FIREFIGHTERS' PENSION FUND Chairperson Print Name: Date: u PALM BEACH GARDENS FIREFIGHTERS' PENSION FUND DISBURSEMENTS February 11, 2008 • PENSION RESOURCE CENTER, LLC. $ 1,600.00 (Bill for services for January and February 2008) • REGIONS MORGAN KEEGAN TRUST $ 1,837.90 (Custodial Fees for October, November and December 2007) • SUGARMAN & SUSSKIND $ 1,300.00 (Fees for legal services for November and December 2007) • VOYAGEUR ASSET MANAGEMETN INC. $ 3,791.77 (41h Quarter 2007 Management Fee) • BOGDAHN CONSULTING, LLC. $ 3,875.00 (4th Quarter 2007 Monitoring Fee) • STEVEN I. GORDON $ 1,570.00 (Progress bill for audit for year ended September 30, 2007) • SHANNON J. FREDERICK $ 2,180.88 (Refund of Contributions) Total Disbursements for Approval $ 16,155.55 (Trustee) (Trustee) PENSION RESOURCE CENTER 4360 Northlake Boulevard, Suite 206 West Palm Beach, FL 33410 Bill To Palm Beach Gardens Firefighters' Invoice Date gP08] 1/l/2008 P.O. Number Terms Rep Ship Via F.O.B. Project I / I /2008 Quantity Item Code Description Price Each Amount Admin Fee- PBGFF... Palm Beach Gardens Firefighters' Pension Fund - January 2008 800.00 800.00 Total s800.00 Resource Centers, LLC 4360 Northlake Blvd Suite 206 Palm Beach Gardens, FL 33410 Bill To Palm Beach Gardens Firefighters' Invoice Date Invoice # 2/1/2008 P080050 Description Qty Rate Class Amount Palm Beach Gardens Firefighters' Pension Find 800.00 PRC - FL 800.00 Total x800.00 If you have any questions concerning this invoice, please contact Jim Jameson at Resource Centers. LLC. Phone 561 -459 -2960 or Email - Jim.Jameson(rPResource- Team.cw Balance Due ue 5800.00 REGIONS MORGAN KEEGAN STATEMENT OF TRUSTEES FEES INVOICE DATE 01/11/2008 ACCOUNT # ACCOUNT NAME ;;'� h', I i) 3320005077 PB GARDENS FIRE I3i:_. J. SCOTT BAUR THE PENSION RESOURCE CENTER, INC 4360 NORTHLAICB BLVD, SUITE 206 PALM BEACH GARDEN FL 33410 INVOICE NUMBER 37285 $ 1,837.90 SUMMARY OF ACCOUNT PREVIOUS BALANCE 1,227.87 CURRENT FEE: 610.03 BALANCE DUE $ 1,837.90 FEE CALCULATION DETAIL 12/01/2007 - 12/31/2007 DESCRIPTION / RATE FEE TOTAL BASIS MARKET VALUE PERIOD ENDING 12/31/2007 18,300,851.23 0.0000083333 15,250.65 15,250.65 $ 15,250.65 FEE CALCULATION DETAIL 12/01/2007 - 12/31/2007 ITEM AMOUNT ------------ -------------- - - - - -- ------ - - - - -- DISCOUNT: PERIOD ENDING 12/31/2007 14,640.62 - TOTAL $ 14,640.62- SUMMARY OF FEE CALCULATION DETAIL ITEM AMOUNT -------------------------- - -- - -- ------ - - - - -- MARKET VALUE 15,250.65 DISCOUNT 14,640.62 - TOTAL AMOUNT DUE FOR CURRENT PERIOD $ 610.03 FOR FEE CALCULATION PERIOD 1210112007 - 12/31/2007 CONSOLIDATED ACCOUNT PRORATION FOR MASTER ACCOUNT M21485 PALM BCH GARDENS ACCOUNT NAME PERCENTAGE AMOUNT CHARGE /BILL FEE 3320005077 PB GARDENS FIRE 90.47438030% 551.92 BILL 3320010132 PB GARDENS FREED 9.52561970% 58.11 BILL TO A/C 3320005077 ACCOUNT NAME PERCENTAGE MARKET VALUE 3320005077 PB GARDENS FIRE 90.47438030% 16,557,581.74 3320010132 PB GARDENS FREED 9.52561970% 1,743,269.49 REGIONS MORGAN KEEGAN STATEMENT OF TRUSTEES FEES T INVOICE DATE 12/11/2007 ` X007 C ACCOUNT # ACCOUNT NAME 3320005077 PB GARDENS FIRE J. SCOTT BAUR THE PENSION RESOURCE CENTER, INC 4360 NORTHLAKE BLVD, SUITE 206 PALM BEACH GARDEN FL 33410 MARKET VALUE PERIOD ENDING 11/30/2007 18,272,662.75 0.0000083333 15,227.16 15,227.16 $ 15,227.16 FEE CALCULATION DETAIL 11/01/2007 - 11/30/2007 ITEM AMOUNT -------------------------- - - - - -- ------ - - - - -- DISCOUNT: PERIOD ENDING 11/30/2007 14,618.07 - TOTAL $ 14,618.07- SUMMARY OF FEE CALCULATION DETAIL ITEM AMOUNT ------------------------ -- - - - - -- ------ - - - - -- MARKET VALUE 15,227.16 DISCOUNT 14,618.07 - TOTAL AMOUNT DUE FOR CURRENT PERIOD $ 609.09 FOR FEE CALCULATION PERIOD 11/01/2007 - 11/30/2007 CONSOLIDATED ACCOUNT PRORATION FOR MASTER ACCOUNT M21485 PALM BCH GARDENS ACCOUNT INVOICE NUMBER 35709 $ 1,227,87 PERCENTAGE SUMMARY OF ACCOUNT 3320005077 PB GARDENS FIRE 90.45968552% 550.98 BILL PREVIOUS BALANCE 1,801.06 GARDENS FREED PAYMENTS RECEIVED: 1,182.28 - ACCOUNT CURRENT FEE: 609.09 PERCENTAGE BALANCE DUE $ 1,227.87 PB FEE CALCULATION DETAIL 11/01/2007 - 11/30/2007 + + + + + + + + + + + + + + + ++ + + + + + + + + + + + + + + + + + + + + + ++ + + + + + + + + + + + ++ + + + + + + + + + + + ++ DESCRIPTION / RATE FEE TOTAL BASIS MARKET VALUE PERIOD ENDING 11/30/2007 18,272,662.75 0.0000083333 15,227.16 15,227.16 $ 15,227.16 FEE CALCULATION DETAIL 11/01/2007 - 11/30/2007 ITEM AMOUNT -------------------------- - - - - -- ------ - - - - -- DISCOUNT: PERIOD ENDING 11/30/2007 14,618.07 - TOTAL $ 14,618.07- SUMMARY OF FEE CALCULATION DETAIL ITEM AMOUNT ------------------------ -- - - - - -- ------ - - - - -- MARKET VALUE 15,227.16 DISCOUNT 14,618.07 - TOTAL AMOUNT DUE FOR CURRENT PERIOD $ 609.09 FOR FEE CALCULATION PERIOD 11/01/2007 - 11/30/2007 CONSOLIDATED ACCOUNT PRORATION FOR MASTER ACCOUNT M21485 PALM BCH GARDENS ACCOUNT NAME PERCENTAGE AMOUNT CHARGE /BILL FEE 3320005077 PB GARDENS FIRE 90.45968552% 550.98 BILL 3320010132 PB GARDENS FREED 9.54031448% 58.11 BILL TO A/C 3320005077 ACCOUNT NAME PERCENTAGE MARKET VALUE 3320005077 PB GARDENS FIRE 90.45968552% 16,529,393.26 3320010132 PB GARDENS FREED 9.54031448% 1,743,269.49 REGIONS MORGAN KEEGAN STATEMENT OF TRUSTEES FEES INVOICE DATE 11/13/2007 ACCOUNT # ACCOUNT NAME 3320005077 PB GARDENS FIRE J. SCOTT BAUR THE PENSION RESOURCE CENTER, INC 4360 NORTHLAKE BLVD, SUITE 206 PALM BEACH GARDEN FL 33410 INVOICE NUMBER 34885 $ 1,801.06 SUMMARY OF ACCOUNT PREVIOUS BALANCE 1,182.28 CURRENT FEE: 618.78 BALANCE DUE $ 1,801.06 FEE CALCULATION DETAIL 10/01/2007 - 10/31/2007 DESCRIPTION / RATE FEE TOTAL BASIS MARKET VALUE PERIOD ENDING 10!31/2007 18,563,600.08 0.0000083333 15,469.60 15,469.60 $ 15,469.60 FEE CALCULATION DETAIL 10/01/2007 - 10/31/2007 ITEM AMOUNT ---- ---------------------- - - - - -- ------ - - -- -- DISCOUNT: PERIOD ENDING 10/31/2007 14,850.82 - TOTAL $ 14,850.82- SUMMARY OF FEE CALCULATION DETAIL ITEM AMOUNT -------------------------- -- - - -- ------ - - - - -- MARKET VALUE 15,469.60 DISCOUNT 14,850.82 - TOTAL AMOUNT DUE FOR CURRENT PERIOD $ 618.78 FOR FEE CALCULATION PERIOD 1010112007 - 10/31/2007 CONSOLIDATED ACCOUNT PRORATION FOR MASTER ACCOUNT M21485 PALM BCH GARDENS ACCOUNT NAME PERCENTAGE AMOUNT CHARGE /BILL FEE 3320005077 PB GARDENS FIRE 90.60920574% 560.67 BILL 3320010132 PB GARDENS FREED 9.39079426% 58.11 BILL TO A/C 3320005077 ACCOUNT NAME PERCENTAGE MARKET VALUE 3320005077 PB GARDENS FIRE 90.60920574% 16,820,330.59 3320010132 PB GARDENS FREED 9.39079426% 1,743,269.49 T�7ED 10V 2 6 2007 Robert A. Sugarman Howard S. Susskind David E. Robinson Kenneth R. Harrison, Sr. D. Marcus Braswell, Jr. Pedro A. Herrera SUGARMAN & SUSSKIND PROFESSIONAL ASSOCIATION ATTORNEYS AT LAW January 9, 2008 City df Palm Beach Gardens Firefighters' Pension Fund c/o Margaret M. Adcock, Administrator The Pension Resource Center, Inc. 4360 Northlake Boulevard, Suite 206 Palm Beach Gardens, Florida 33410 CURRENT FEES: CURRENT COSTS: PREVIOUS BALANCE: PAYMENTS RECEIVED: TOTAL AMOUNT DUE 0.00 0.00 3,960.00 2,660.00 -ck #8688530 1,300.00 100 Miracle Mile Suite 300 Coral Gables, Florida 33134 (305) 529 -2801 Broward 763 -2566 Toll Free 1- 800 -329 -2122 Facsimile (305) 447 -8115 SUGARMAN & SUSSKIND 100 Miracle Mile Suite 300 Coral Gables, Florida 33134 Telephone: 305 -529 -2801 Fax: 305 -447 -8115 www.sugarmansusskind.net City of Palm Beach Gardens Firefighters' Pension Fund January 09, 2008 c/o Margaret M. Adcock, Administrator The Pension Resource Center, Inc. 4360 Northlake Boulevard, Suite 206 Palm Beach Gardens FL 33410 Client:Matter PBGF :INVM In Reference To: Investment Manager Amount Previous balance $100.00 12/11/2007 Payment - Thank You. Check No. 8688530 ($100.00) Total payments and adjustments ($100.00) Balance due $0.00 Client:Matter PBGF:MEET In Reference To: Meeting Amount Previous balance $1,300.00 Balance due $1,300.00 Client:Matter PBGF:MISC In Reference To: Miscellaneous Amount Previous balance $50.00 City of Palm Beach Gardens Firefighters' Pension Fund Page 2 Amount 12/11/2007 Payment - Thank You. Check No. 8688530 ($50.00) Total payments and adjustments ($50.00) Balance due $0.00 Client:Matter PBGF:SIPO In Reference To: Statement of Investment Policy Amount Previous balance $300.00 12/11/2007 Payment - Thank You. Check No. 8688530 ($300.00) Total payments and adjustments ($300.00) Balance due $0.00 Robert A. Sugarman Howard S. Susskind David E. Robinson Kenneth R. Harrison, Sr. D. Marcus Braswell, Jr. Pedro A. Herrera SUGARMAN & SUSSKIND PROFESSIONAL ASSOCIATION ATTORNEYS AT LAW December 10, 2007 City 6f Palm Beach Gardens Firefighters' Pension Fund c/o Margaret M. Adcock, Administrator The Pension Resource Center, Inc. 4360 Northlake Boulevard, Suite 206 Palm Beach Gardens, Florida 33410 CURRENT FEES: CURRENT COSTS: PREVIOUS BALANCE: PAYMENTS RECEIVED: TOTAL AMOUNT DUE: 100 Miracle Mile Suite 300 Coral Gables, Florida 33134 (305 ) 529 -2801 Broward 763 -2566 Toll Free 1- 800 -329 -2122 Facsimile (305 ) 447 -8115 1,300.00 0.00 2,660.00 0.00 3,960.00 R-r >. SUGARMAN & SUSSKIND 100 Miracle Mile Suite 300 Coral Gables, Florida 33134 Telephone: 305 -529 -2801 Fax: 305 -447 -8115 www.sugarmansusskind.net City of Palm Beach Gardens Firefighters' Pension Fund December 05, 2007 c/o Margaret M. Adcock, Administrator The Pension Resource Center, Inc. 4360 Northlake Boulevard, Suite 206 Palm Beach Gardens FL 33410 Client:Matter PBGF:INVM In Reference To: Investment Manager Amount Previous balance $100.00 Balance due $100.00 Client:Matter PBGF:MEET In Reference To: Meeting Professional Services Hrs /Rate Amount 11/26/2007 Prepare for meeting 0.50 100.00 200.00 /hr Attend meeting and travel 6.00 1,200.00 200.00 /hr For professional services rendered Balance due Client:Matter PBGF:MISC 6.50 $1,300.00 $1,300.00 City of Palm Beach Gardens Firefighters' Pension Fund Page 2 In Reference To: Miscellaneous Amount Previous balance $50.00 Balance due $50.00 Client:Matter PBGF:SIPO In Reference To: Statement of Investment Policy Amount Previous balance $300.00 Balance due $300.00 VOY(-i,get1 ASSET MANAGEMENT INC.. Margaret M. Adcock The Pension Resource Center, LLC 4360 Northlake Blvd., Suite 206 Palm Beach Gardens FL 33410 83J Invoice Number 7046 Invoice Date: 01/17/2008 Billing Period: 10/01/2007 - 12/31/2007 Custodian Account Number: CF -RSY8 Account Number: P703000 INVESTMENT MANAGEMENT FEE For the Arrears Period of 10/01/2007 to 12/31/2007 Account Name: City of Palm Beach Gardens Firefighters' Pension Trust Fund Ending Market Value for Account P703000: October 2007: 1,826,403.49 USD November 2007: 1,703,545.67 USD December 2007: 1,640,641.50 USD Average Market Value 1,723,530.22 USD Market Value Based Fees 1,723,530.22 @ 0.8800% x 90 / 360 3,791.77 Total Current Period Fees 3,791.77 USD Total Amount Due Upon Receipt 3,791.77 USD If you have any questions. please call Portfolio Administration at 612- 376 -7151 or 1 -866- 759 -9083 or send an email to vambiI]ing @voyageur.nct [Keep this portion tur your ti:;ancial recordsl Invoice Number: 7046 Invoice Date: 01/17/2008 Billing Period: 10/01/2007 - 12/31,'2007 Custodian Account Number: CF -RSY8 Account Number: P703000 Account Name: City of Palm Beach Gardens Firefighters' Pension Trust Fund Wire Instructions: Bank: US Bank ABA: 091000022 Account: 1- 602 -3318 -3526 RBC Dain Rauscher Inc. Reference: Invoice 7046 Amount Due 3,791.77 USD Payment Mailing Address: Voyageur ASSET MANAGEMENT INC PO Box 9195 Minneapolis, MN 55480 -9934 Remittance Amount USD Mail this portion with your puyrnenl. Thank you for your business. Bogdahn Consulting, I.I.C. 340 West Central Ave Suite 300 Winter Haven, Fl 33880 Palm Beach Gardens Firefighters' Pension C/O Pension Resource Center 4360 NorthLake Boulevard Palm Beach Gardens, Fl 33410 Invoice Date Invoice # 12/31/2007 2850 Description Amount Performance Evaluation and Consulting Services 2,000.00 10/01/07 - 12/31/07 additional portfolio evaluation - international equity 625.00 additional portfolio evaluation - real estate 625.00 additional portfolio evaluation - Bond 625.00 Balance Due $3,875.00 Steven I. Gordon Certified Public Accountant 4600 W. Commercial Blvd., Ste. 5 Tamarac, FL 33319 Phone (954) 485 -5788 Palm Beach Gardens Firefighters Pension c/o Pension Resources Inc. 4360 N. Lake Blvd., # 206 Palm Beach Gardens, FL 33410 Invoice #: 4796 Date: 12/12/2007 Progress billing in connection with certified audit as of and for the year ended $1,570.00 September 30, 2007 Total Charges: 1,570.00 Prior Balance (Credit) Before this Invoice: 0.00 Total Balance Due: $1,570.00 THE PENSION RESOURCE CENTER, LLC 4360 Northlake Boulevard, Suite 206 ❖ Palm Beach Gardens, FL 33410 Phone (561) 624 -3277 -e Fax (561) 624 -3278 • :• www.RESOURCECENTERS.COM PALM BEACH GARDENS FIREFIGHTERS' PENSION FUND Meeting Dates for 2008 Monday, February 11, 2008 at 10:00 A.M. (Bogdahn Consulting) Monday, April 21, 2008 at 10:00 A.M. Monday, June 16, 2008 at 10:00 A.M. (Bogdahn Consulting and Dana Investment Advisors) Monday, August 18, 2008 at 10:00 A.M. (Bogdahn Consulting) Monday, October 20, 2008 at 10:00 A.M. Monday, November 17, 2008 at 10:00 A.M. (Bogdahn Consulting and Dana Investment Advisors) The meetings will be held in the Council Chambers at City Hall located at 10500 North Military Trail, Palm Beach Gardens Performance Evaluation for Palm Beach Gardens Firefighters' Pension Plan Dana, Voyageur, American Realty, & Galliard For the Period Ending December 31, 2007 Presented by: Bogdahn Consulting, LLC Palm Beach Gardens Firefighters' Pension Plan Executive Summary Report Explanation The Executive Summary provides an overview of the fund's performance. It shows the performance in dollars, percent, and relative to the investment policy. These are provided over different time periods including up and down markets. All rates of return are annualized if the period for which they are calculated exceeds one year. Account Reconciliation: This section shows the performance of the account in dollars, during the most recent quarter, the calendar year, and since the inception date. The Beginning Value is the value at the start of each period. The Ending Value shows the value as of the date of the report. Net contributions are the total contributions less the total withdrawals during the period. The Investment G/L is the gain or loss resulting from the investments. It is the difference between the beginning and ending values that cannot be explained by the net contributions. Positive investment G/L figures represent a profit, and negative values represent a loss Investment Policy: This section defines the benchmark against which the fund is being compared. Generally, this is the most important objective for a fund to achieve. The performance of the fund relative to this measure over longer periods of time, such as market cycles, is the strongest indicator of the success or failure of the investment strategy. This objective should be reasonable, and the performance of the fund should be measured against the investment policy after adjusting for risk. Trailing Returns: This section shows the cumulative time weighted returns over the last 1 year, 2 years, and so on up through 10 years if available, as well as since the inception date. A positive difference indicates the fund has exceeded the policy's returns. The investor would prefer that this difference be positive for all time periods, however, it is more important for it to be positive for the longer periods rather than the shorter periods. Calendar Year Returns: This section gauges the consistency of performance over one year time periods. Each calendar year of performance represents the return from January 1 st through December 31 st. Watch out for a trend of declining relative performance in recent periods. Returns In Up /Down Markets: This section shows how the fund performed in both up and down markets. The methodology is to segregate the performance for each time period into the quarters in which the market, as defined by the policy, was positive and negative. Quarters with negative policy returns are treated as down markets, and quarters with positive policy returns are treated as up markets. Thus, in a 3 year or 12 quarter period, there might be 4 down quarters and 8 up quarters. Up market returns are calculated for the fund and the policy based on the up quarters. Down market returns are calculated for the fund and the policy based on the down quarters. The ratio of the fund's return in up markets to the policy's is the up market capture ratio. The ratio of the fund's return in down markets to the policy's is the down market capture ratio. Ideally, the fund would have a greater up market capture ratio than down market capture ratio. Palm Beach Gardens Firefighters' Pension Plan Executive Summary Account Reconciliation Investment Policy 12/31/2007 2007 04/30/1998 Qtr YTD Incept Index Weight Beginning Value 22,444 18,826 2,994 Russell 3000 55.00 Net Flows 441 2,913 14,232 Lehman U.S. Aggregate Intermediate 30.00 Investment G/L -262 885 5,398 MSCI EAFE 10.00 Ending Value 22,624 22,624 22,624 Citigroup Treasury Bill - 3 Month 5.00 Trailing Returns through December 31, 2007 04/30/1998 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9 Yr 10 Yr Incept Fund 4.74 8.30 8.36 8.40 10.57 6.18 4.11 3.70 4.31 5.08 Policy 6.57 9.57 8.02 8.03 10.26 6.28 4.60 3.86 4.71 5.45 Diff -1.83 -1.27 0.34 0.37 0.31 -0.10 -0.49 -0.16 -0.40 -0.37 Calendar Year Returns 12/31/2007 2007 Qtr YTD 2006 2005 2004 2003 2002 2001 2000 1999 1998 Fund -1.15 4.74 11.99 8.49 8.52 19.66 -13.30 -7.49 0.88 9.33 Policy -1.08 6.57 12.65 4.98 8.05 19.66 -11.57 -4.91 -1.19 11.78 Diff -0.07 -1.83 -0.66 3.51 0.47 0.00 -1.73 -2.58 2.07 -2.45 Returns in Up Markets Returns in Down Markets 04/30/1998 04/30/1998 3 Yr 5 Yr 9 Yr Incept 3 Yr 5 Yr 9 Yr Incept Fund 11.8 15.0 13.6 15.2 Fund -1.1 -1.6 -12.1 -12.3 Policy 12.6 15.6 16.0 17.4 Policy -3.5 -4.3 -14.6 -14.7 Ratio 94.0 95.9 85.4 87.2 Ratio 31.0 38.2 82.9 83.9 Inception date is April 30, 1998 All dollar values are shown in thousands. Returns for periods exceeding one year are annualized Returns are net of fees. ASVF- Investment 7/5/2006 $210 000., Galliard $3 M 712!07, Index change effective 10 -01 -2007 From LB G/C Int, to LB INt. Aggregate 2 Palm Beach Gardens Firefighters' Pension Plan Asset Allocation as of December 31, 2007 Equi, 50% Equi 490/ At Market Int'L REIT 5% Cash & Equiv 0% sd Income 38% At Cost Int'I 3 -1 REIT 5% Income 40% Cash & Equiv 0% Palm Beach Gardens Firefighters' Pension Plan Asset Allocation as of December 31, 2007 Equity Breakdown- Cost Voyageur 11% Dana 89% Equity Breakdown - Market Voyageur 13% uana 87% 3 -2 Palm Beach Gardens Firefighters' Pension Plan Universe Comparison Report Explanation The universe compares the fund's returns to a group of other investment portfolios, called a universe. Ideally the universe is comprised of many other investment funds with similar investment profiles. Comparisons are provided over many different time periods. Trailing Returns: This section focuses on longer term returns. It shows the cumulative time weighted returns and percentile rankings for the last 1 year, 2 years, 3 years, and so on up through 10 years if available. The returns for the fund, the policy and the universe percentiles are displayed. A percentile ranking of 1 is the best, and 100 is the worst. For example, a ranking of 50 means that the fund outperformed half of the universe. A ranking of 25 means the fund was in the top 25% of the universe, outperforming 75 %. Above 50 is acceptable. Above 25 is excellent. High rankings over all time periods are ideal; however, it is more important to rank highly over the longer periods rather than the shorter periods. Calendar Year Returns: This section focuses on shorter periods and gauges the consistency of performance over time. It shows the calendar year returns for the fund, the investment policy and the universe percentiles. Each full year of performance represents the return from January 1 st through December 31 st. Ideally the fund has performed well in the earlier years and in the most recent years. Watch out for a trend toward underperformance in recent periods. Note the performance in different market environments. A high policy return indicates a bull market, and a low policy return indicates a bear market. All rates of return are annualized if the period for which theyare calculated exceeds one year 4 Palm Beach Gardens Firefighters' Pension Plan Universe Comparisons 55% PLCC,30% Hg Quality Bd,10% Int'I, 5% Cash Trailing Returns through December 31, 2007 3 Qtrs 1 Yr 2 Yr 1 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9 Yr Fund Return 2.06 4.74 8.30 8.36 8.40 10.57 6.18 4.11 3.70 4.31 % -tile 93 81 I 88 34 36 38 48 76 57 75 Policy Return 4.83 6.57 9.57 8.02 8.03 10.26 6.28 4.60 3.86 4.71 % -tile 51 40 44 52 55 55 43 47I 49 49 Universe 5th % -tile 8.75 10.45 11.50 10.14 9.85 11.93 7.77 6.74 7.30 6.89 25th % -tile 5.93 7.38 10.08 8.60 8.74 10.84 6.74 5.24 5.12 5.65 50th % -tile 4.84 6.19 9.45 8.04 8.10 10.33 6.11 4.49 3.81 4.66 75th % -tile 3.79 5.11 8.92 7.66 7.76 9.96 5.71 4.12 3.36 4.30 95th % -tile 1.44 2.79 7.34 6.67 6.77 8.94 4.97 3.04 2.64 3.75 Calendar Year Returns Qtr YTD 2006 2005 2004 2003 2002 2001 2000 1999 Fund Return -1.15 4.74 11.99 8.49 8.52 19.66 -13.30 -7.49 0.88 9.33 % -tile 47 81 77 3 38 55 86 96 39 71 Policy Return -1.08 6.57 12.65 4.98 8.05 19.66 -11.57 -4.91 -1.19 11.78 % -tile 40 40 58 63 54 55 57 53 61 60 Universe 5th % -tile 0.01 10.45 15.81 7.92 11.19 22.97 -6.23 3.50 14.78 25.47 25th % -tile -0.79 7.38 13.90 6.14 9.35 20.94 -10.12 -1.28 5.69 13.43 50th % -tile -1.21 6.19 12.82 5.24 8.15 19.78 -11.39 -4.80 -0.77 12.16 75th % -tile -1.66 5.11 12.08 4.75 7.54 18.95 -12.46 -5.34 -1.76 7.56 95th % -tile -2.68 2.79 9.59 3.99 5.24 17.10 -14.42 -7.42 -3.42 0.34 Returns are in percent. " %- tile" is the percentile ranking within the universe. Returns for periods exceeding one year are annualized. Incept is April 30, 1998 to December 31, 2007 ASVF- Investment 7/5/2006 $210 000., Galliard $3 M 7/2/07, Index change effective 10 -01 -2007 From LB G/C Int, to LB INt. Aggregate 5 Palm Beach Gardens Firefighters' Fixed Income - Dana Executive Summary Account Reconciliation 12/31/2007 2007 04/30/1998 Qtr YTD Incept Beginning Value 3,158 6,027 1,040: Net Flows 2,157 -862 3,036 InvestmentG /L 84 234 1,323 Ending Value 5,399 5,399 5,399 Trailing Returns through December 31, 2007 Investment Policy Index Weight Calendar Year Returns 12/31/2007 2007 Qtr YTD 2006 2005 2004 2003 2002 2001 2000 1999 1998 Fund 2:40 6.01 4.49 1.72 128 3.78 10,02 7.76 04/30/1998 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9 Yr 10 Yr Incept Fund. :: 6 -.O ............. 5 24 . 4.05 3.86 3.84 4.85 .. 5:26. 28 :: 5.26 5:66 Policy 7.38 5.71 4.31 3.99 4.08: 5.21 5 -67 :::643:: 5.44 5:82: Diff -1.37 70.47 -0.26 -0.13 ;0 24 . 0.3>;: 0:41 fl.15 0:18 :-016 Calendar Year Returns 12/31/2007 2007 Qtr YTD 2006 2005 2004 2003 2002 2001 2000 1999 1998 Fund 2:40 6.01 4.49 1.72 128 3.78 10,02 7.76 13:75 -2.55 .Policy:. 2.89 7.38 4.07 1.57 3.04::: 4.45 1:1,02 8 51: 11.84 -2:15 ...: DO:.: -0.49 -1.37 0.42 0:.15 0.24 -0.67 -1.00 .-0.75 1.91 - 0.40. MULLIF115 In UL) IVIarK6l5 04/30/1998 3 Yr 5 Yr 9 Yr Incept Fund _ 7.1 -2:9 -3:3 ::..3:3. Policy 7.6 7.3 $.9: 91:. Ratio 93.3 94.9 .98.4 98.1 Inception date is April 30, 1998 All dollar values are shown in thousands. Returns for periods exceeding one year are annualized. Returns are gross of fees. Returns in Down Markets 04/30/1998 3 Yr 5 Yr 9 Yr Incept Fundy :7 -2:9 -3:3 ::..3:3. Policy -1.9 -3.0 : -3A -3.0. Ratio 89.6::: .99.0 ..: 108.3 ::: 108:3: Bond Index change effective 4/1/2003 from LB Gov /Credit to LB Intermediate Gov /Credit, update to LB Int. aggregate effective 10 -01 -2007 N Palm Beach Gardens Firefighters' Fixed Income- Galliard Fund Executive Summary Account Reconciliation 12/31/2007 2007 07/02/2007 Qtr YTD Incept Beginning Ualue: 3;088 0 3100.0 ..Net, FIQVv 85 3,085 In vestm6nt G/L .......... .................................. `.:. 78 . .. ......... ............................... ... 16Fi: 166 .. ............................... .................................... ..................................... ndirxg Value .:::. ..... ............................... ............................... ............................... 3;251: :31251 Trailing Returns through December 31, 2007 investment rol Index Weight Calendar Year Returns 12/31/2007 2007 Qtr YTD 2006 2005 2004 2003 2002 2001 2000 1999 1998 Fund: 2:5 FQ py 3:00 Di f -0.48 . Returns in Up Markets Returns in Down Markets 07/02/2007 Incept Fund 5:5 Pollcy 5:9 Ratio .: 94.0 Inception date is July 2, 2007 All dollar values are shown in thousands. Returns for periods exceeding one year are annualized. Returns are net of fees. Account funded 7/2/2007 $3 Million 7 Fund PQlicy Ratio 07/02/2007 Incept Palm Beach Gardens Firefighters' Total Equity Executive Summary Account Reconciliation 12/31/2007 2007 04/30/1998 Qtr YTD Incept $ag.......1/alwe .......................... . .. . . 12;555 .. 1,073: 1,784. filet Flows : `:: ;. ;;>'::.' 160.00: 30,45 hvostmenf fL`:'::?? ::' =475 354 3,821: i,idirto:Val id` "`:':* .:: :12 78Z :: 12:;782 12,782 I railing Keturns tnrougn Uecemoer ,il, zuu/ Investment Policy Index Weight S&P :506 8500 MSC( I ,AFE 15.00:: Totat 160.00: Calendar Year Returns 12/31/2007 2007 Qtr YTD 2006 2005 2004 2003 2002 2001 2000 1999 1998 Fund =3:61 :3,31 17..0$ 1:2.:68 11,74.:.. 30,45 :: -2$191 :14.9$ . 04/30/1998 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9 Yr 10 Yr Incept Rand 3;31. 9.98 1038: 11.09 14.72 5792 2.65 1.45 3.19 4.31 ::Policy::::: 6:13 1 11 9.90 10.14 1:3.62 6.70 3.82 2.11 4.06 .4.97 Riff -2:82 -1.62 0.9$ 0:95. 1.10 0.7$ -:1.17 -43.66 -0.87 -0.66 Calendar Year Returns 12/31/2007 2007 Qtr YTD 2006 2005 2004 2003 2002 2001 2000 1999 1998 Fund =3:61 :3,31 17..0$ 1:2.:68 11,74.:.. 30,45 :: -2$191 :14.9$ . -$:58 18.20 Policy 73.08 6.113 17.35 6::58 10 88 28.68 -22.10 - 11:88 : -9.11 21.04 Diff -0:53 72.82 -0.27 61fl {J.86. 1::77 -3.10: 2.53 -2:84 Returns in Up Markets Returns in Down Markets 04/30/1998 3 Yr 5 Yr 9 Yr Incept Fund 165 22.4 22,0 25:9 Policy :16.9 22.4 24.9 27.4 Ratio :: 97:3:. 62:0 92.0 9.4 .6. Inception date is April 30, 1998 All dollar values are shown in thousands. Returns for periods exceeding one year are annualized. Returns are net of fees. Index for Total Equity changed to S &P 500 effective 10 -01 -2007 14 04/30/1998 3 Yr 5 Yr 9 Yr Incept Fund X3.3 �5:7 -24.3 -25.2 Policy... .. - 6.6:.:. 41 724,T : -25.4 Ratio.:. 49A 62:0 98.4 .: 991 Palm Beach Gardens Firefighters' Total Equity Universe Comparisons 85% Pure Lge Cap Core & 15% International i raumg Keturns through uecemner ,31, 2uu 1 Calendar Year Returns 3 Qtrs 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9 Yr Fund:. Return -0.06 3.31 9.98 10.88 11.09 14.72 5.92 2.65 1.45 3.19 % -tile 95 88 87 22 23 18 84 92 89 92 y: >. Return 4.35 6.13 11.60 9.90 10.14 13.62 6.70 3.82 2.11 4.06 % -tile 59 50 49 51 49 49 48 51 59 53 (Jnwerse 5th % -tile 10.61 13.28 15.00 13.36 12.87 15.83 9.14 7.51 8.35 7.64 25th % -tile 6.23 7.46 12.40 10.66 10.93 14.29 7.69 5.06 5.01 5.43 50th % -tile 4.80 6.13 11.57 9.91 10.09 13.60 6.63 3.83 2.43 4.10 75th % -tile 3.28 4.87 10.95 9.37 9.58 13.10 6.17 3.39 1.82 3.67 95th % -tile -0.15 0.85 8.21 7.45 8.03 11.97 5.04 1.56 0.82 2.97 Calendar Year Returns 95th % -tile I -5.311 0.851 12.001 4.911 5.52 I 24.94 I -26.72 I -19.45 1 -11.00 1 -0.72 Returns are in percent. " %- tile" is the percentile ranking within the universe. Returns for periods exceeding one year are annualized. Incept is April 30, 1998 to December 31, 2007 Index for Total Equity changed to S &P 500 effective 10 -01 -2007 s Qtr YTD 1 2006 2005 2004 2003 2002 2001 2000 1999 :Fund::. _ . Return -3.61 3.31 17.08 12.68 11.74 30.45 -28.91 -14.98 -6.58 18.20 % -tile 71 88 52 2 30 19 100 93 46 66 Palley Return -3.08 6.13 17.35 6.58 10.88 28.68 -22.10 -11.88 -9.11 21.04 % -tile 44 50 45 52 38 34 47 47 57 2311 Universe 5th % -tile -1.32 13.28 22.47 10.83 14.89 31.71 -14.19 1.29 18.77 36.89 25th % -tile -2.68 7.46 18.63 7.90 12.14 29.67 -20.21 -6.82 4.23 20.82 50th % -tile -3.17 6.13 17.16 6.67 10.68 28.26 -22.19 -11.93 -8.21 20.13 75th % -tile -3.72 4.87 16.18 5.92 10.04 26.79 -22.80 -12.37 -9.39 12.73 95th % -tile I -5.311 0.851 12.001 4.911 5.52 I 24.94 I -26.72 I -19.45 1 -11.00 1 -0.72 Returns are in percent. " %- tile" is the percentile ranking within the universe. Returns for periods exceeding one year are annualized. Incept is April 30, 1998 to December 31, 2007 Index for Total Equity changed to S &P 500 effective 10 -01 -2007 s Palm Beach Gardens Firefighters' Equity- Dana Executive Summary Account Reconciliation 12/31/2007 2007 04/30/1998 Qtr YTD Incept ..... .............. ...... $ gir}ri3rig:Value 10,803 9,460 1,784 tVet FIQws.... 701 1,355 5,977 :enviert i e i. .......... ...:::..:.....63.......: ........................... .................................... ............................... ............................... ....... 3;380 . ..................................... . ............................... ............................. 1= ndirtg ual . .. ............................... ..... ............................... ....... ...._ ...... Trailing Returns through December 31, 2007 Investment Policy Index Weight Calendar Year Returns 12/31/2007 2007 21:6 22,4:. 25:4:: PohCy 15.4 21,5 24:3 04/30/1998 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9 Yr 10 Yr Incept :Ft nrl. 3.53 8:89 10.14 10.54 14.26 5.57 236 1.19 2.96 4.10 :Policy 5;15 10 31 8.60 9:17 12.82 6.06: 3.29 1.65 3.65 4.58. tiff -1.62 -1.42 1.54 137 1.44 -049 -0.93 -0.46: -0.69 -0.48 Calendar Year Returns 12/31/2007 2007 21:6 22,4:. 25:4:: PohCy 15.4 21,5 24:3 26;8. Qtr YTD 2006 2005 2004 2003 2002 2001 2000 1999 1998 Fund -3:21 3.53 14.52. 12;68 11.74 30,45 - 28:91 -14.98 : -6.58 18.20 Policy 3.:3.4 51.16 15172 5:27 10.88 28:68 -22.10 - 11.8$ -911 21 :04 Diff 0.13 =1.62: 1.20 7.41 0.86. 177 -6.81 - 3.:10: 2.53 -2:84 Returns in Up Markets 04/30/1998 3 Yr 5 Yr 9 Yr Incept fund 15.2 21:6 22,4:. 25:4:: PohCy 15.4 21,5 24:3 26;8. Ratio : 981.: 1 N-7 92:1: 9418 Inception date is April 30, 1998 All dollar values are shown in thousands. Returns for periods exceeding one year are annualized. Returns are net of fees. 10 Returns in Down Markets 04/30/1998 3 Yr 5 Yr 9 Yr Incept Fund -2.8: -5:3: -24:2 -251 Polio Ratio 37,7 54.7. 97;3 :. 98.1 Palm Beach Gardens Firefighters' Equity- Dana Universe Comparisons 100% Pure Large Cap Core Trailing Returns through December 31, 2007 Calendar Year Returns 3 Qtrs 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9 Yr Fufld . Return 0.52 3.53 8.89 10.14 10.54 14.26 5.57 2.36 1.19 2.96 % -tile 91 77 84 10 14 9 74 85 84 95 :Policy Return 3.82 5.15 10.31 8.60 9.17 12.82 6.06 3.29 1.65 3.65 % -tile 64 54 51 40 40 39 41 43 53 50 Unlvere 5th % -tile 10.56 12.81 13.80 11.68 11.71 14.85 8.41 7.08 7.71 7.45 25th % -tile 4.82 5.64 10.83 9.15 9.83 13.24 6.97 4.30 4.33 5.71 50th % -tile 4.52 5.22 10.32 8.52 9.05 12.65 5.90 3.18 1.69 3.64 75th % -tile 2.62 3.76 9.76 8.02 8.52 12.16 5.54 2.80 1.38 3.38 95th % -tile -3.38 -2.63 5.53 5.05 6.23 10.03 4.27 0.26 0.91 2.94 Calendar Year Returns Returns are in percent. " %- tile" is the percentile ranking within the universe. Returns for periods exceeding one year are annualized. Incept is April 30, 1998 to December 31, 2007 11 Qtr YTD 2006 2005 2004 2003 2002 2001 2000 1999 Fund Return -3.21 3.53 14.52 12.68 11.74 30.45 -28.91 -14.98 -6.58 18.20 % -tile 30 77 65 1 23 16 100 82 47 65 fi'nlicy Return -3.34 5.15 15.72 5.27 10.88 28.68 -22.10 -11.88 -9.11 21.04 % -tile 45 54 33 49 34 29 46 48 60 38 'Universe 5th % -tile -1.66 12.81 20.97 11.33 15.14 33.34 -15.55 -1.49 13.61 35.03 25th % -tile -3.09 5.64 16.19 7.20 11.51 28.99 -20.13 -9.35 -0.20 22.80 50th % -tile -3.36 5.22 15.48 5.09 10.39 27.83 -22.23 -12.08 -7.39 20.27 75th % -tile -3.72 3.76 12.74 4.22 8.38 24.97 -23.39 -13.51 -9.63 16.39 95th % -tile -6.49 -2.63 4.79 1.07 5.14 20.58 -26.60 -19.10 -14.67 6.13 Returns are in percent. " %- tile" is the percentile ranking within the universe. Returns for periods exceeding one year are annualized. Incept is April 30, 1998 to December 31, 2007 11 Palm Beach Garden Firefighters' International Equity Executive Summary Account Reconciliation 12/31/2007 2007 12/31/2005 Qtr YTD Incept ..................................... Birii?i Vali: :::: ............................... :.:.`:::,XS.: :. >if .... ............................... ............................. .... :.:.:.:: .... icy .. :Vet FIQws.�::..::. .:1.3 .. ......... .. .a..... . :: . . . ........ . .... ...... .............. ............................... rivesfrner�t Q/L .......... ............................... ;:11:1: >::: ...... ...... 27 ...... 441 Trailing Returns through December 31, 2007 Investment Policy Index Weight Calendar Year Returns Returns in Up Markets Returns in Down Markets 1 Yr 12/31/2005 Incept fund. ........ ........................... .......................... . , .:..< : ............................... ......: .. :. ; ............ .... ............................... ............................. .... :.:.:.:: .... icy .. ............................ ............................... ................ :.:. :.5.: ::::::;>:: :::::::::::.::::::::::.:.:....: ...13.... ..................... ...?3... :. .. ......... .. .a..... . :: . . . ........ . .... ...... 1: .. 1 04: . . . ................ . .. ............ . Inception date is December 31, 2005 All dollar values are shown in thousands. Returns for periods exceeding one year are annualized. Returns are net of fees. 12 1 Yr 12/31/2005 Incept fund ............. .......... ...... ................ ........... ........ .... ............ ... .... ........ .... ............... . .. .. .......... .... ......:. -6.:4: . ...... .. ... ....... .... ............................... F'olic�r . ............................... ..... .......... ..... 17. Ratio :::::: ................. ...................... >::: 371:. ::: ::::.:.: ................ ...I..... ............................... 1 ... ...... .. 37.. .. ............. Palm Beach Garden Firefighters' International Equity Universe Comparisons International Equity Trailing Returns through December 31, 2007 Calendar Year Returns Qtr YTD 2006 2005 2004 2003 2002 2001 2000 1999 Return 2 Qtrs 3 Qtrs 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr fund:: Return -7.41 -3.90 1.66 16.93 % -tile 95 100 100 71 Poli cy: . .... . Return 0.48 7.19 11.63 19.00 % -tile % -tile 51 54 51 43 Universe (�nIVrSe . ... . 5th % -tile 11.62 21.83 25.16 28.17 29.25 29.10 32.20 27.09 20.79 14.37 25th % -tile 3.76 11.96 16.56 21.03 19.68 19.90 24.01 17.08 11.67 8.94 50th % -tile 0.53 7.74 11.69 18.42 17.38 17.89 21.68 14.47 9.05 5.86 75th % -tile -2.54 4.10 8.26 16.34 15.50 16.38 19.74 12.98 7.08 3.47 95th % -tile -7.61 -0.88 3.34 12.68 12.63 14.22 17.46 10.85 3.53 -0.43 Calendar Year Returns Qtr YTD 2006 2005 2004 2003 2002 2001 2000 1999 Return -6.36 1.66 34.48 ............. % -tile 94 100 7 pOidy . Return -1.71 11.63 26.86 % -tile 47 51 39 Universe .. : 5th % -tile 2.30 25.16 35.29 38.92 32.32 65.72 1.26 2.71 2.11 117.71 25th % -tile -0.21 16.56 28.37 23.76 23.60 48.59 -8.48 -10.53 -8.63 67.62 50th % -tile -1.89 11.69 25.65 16.31 19.34 38.92 -14.41 -18.53 -15.84 47.72 75th % -tile -3.67 8.26 22.79 13.13 16.57 33.20 -18.10 -23.29 -24.08 29.01 95th % -tile -6.79 3.34 18.65 9.40 12.66 27.55 -23.32 -29.32 -34.43 17.12 Returns are in percent. "% -tile" is the percentile ranking within the universe. Returns for periods exceeding one year are annualized. Incept is December 31, 2005 to December 31, 2007 13 Palm Beach Gardens Firefighters' REIT- American Realty Advisors Executive Summary Account Reconciliation 12/31/2007 2007 07/31/2006 Qtr YTD Incept $egirr�arlg :alias .::: ...:6 216 I railing Returns through December 31, 2007 Investment Policy Index Weight Calendar Year Returns Returns in Up Markets 1 Yr 07/31/2006 Incept Fund 17 3 1 4.7 . 21:0*: .filet Flows 16 $ . X82 7t31 InviesthMt. G/L 11 34 . .. 115 122:: :.ndir rg:value :: 1; t 14 1 11: I railing Returns through December 31, 2007 Investment Policy Index Weight Calendar Year Returns Returns in Up Markets 1 Yr 07/31/2006 Incept Fund 17 3 1 4.7 . Polirrjr 1 8 .: 16 $ . }�atto 16g: 3 9f):3 Inception date is July 31, 2006 All dollar values are shown in thousands. Returns for periods exceeding one year are annualized. Returns are gross of fees. 14 Returns in Down Markets fund .::. Pvli�y:: ;:: Ratio 1 Yr 07/31/2006 Incept Palm Beach Gardens Firefighters` Pension Plan 25.00% Up Market Returns - - - - -- ----- - - - - -- 20.00% - - -- - - - -- - - - - -- 15.00% - - - - -- 10.00% - -- -- - - - - 5.00% - - -- -- - 000% Down Market Returns 0.00% -5.00% � --------------- - - - - -- - 10.00% f----------- - - - - -- - 15.00% 3 Yr 5 Yr 9 Yr Incept Fund ( %) 11.85 14.96 13.64 15.17 Policy ( %) 12.61 15.60 15.97 17.39 Difference ( %) -0.76 -0.64 -2.33 -2.22 Ratio 93.97 95.90 85.41 87.23 # Up Qtrs 9.00 15.00 24.00 25.67 Down Market Returns 0.00% -5.00% � --------------- - - - - -- - 10.00% f----------- - - - - -- - 15.00% 3 Yr 5 Yr 9 Yr Incept Fund ( %) -1.09 -1.65 -12.13 -12.32 Policy ( %) -3.52 -4.32 -14.63 -14.68 Difference ( %) 2.43 2.67 2.50 2.36 Ratio 30.97 38.19 82.91 83.92 # Down Qtrs 3.00 5.00 12.00 13.00 ❑ Fund ( %) a Policy L-Li ASVF- Investment 7/5/2006 $210 000., Galliard $3 M 7/2/07, Index change effective 10 -01 -2007 From LB G/C Int, to LB INt. Aggregate 15 V a , I u e c Palm Beach Gardens Firefighters' Pension Plan Objective Comparison UUZ MUJ JUS SUJ Dui MU4 ,104 504 D04 M05 J05 S05 D05 M06 J06 S06 D06 M07 J07 S07 D07 Quarter Ending ❑ Fund Policy -e Nominal 8% ❑ CPI + 3% Inception date is April 30, 1998 All dollar values are shown in thousands. ASVF- Investment 7/5/2006 $210 000., Galliard $3 M 7/2/07, Index change effective 10 -01 -2007 From LB G/C Int, to LB INt. Aggregate 16 Palm Beach Gardens Firefighters' Pension Plan Attributions of Returns Report Explanation Performance attribution concentrates on evaluating the effect of the manager's decisions on asset allocation and security selection. This allows the investor to see whether the manager is adding value by adjusting the actual asset allocation or by picking individual securities. This information is valuable in helping determine the amount of freedom that might be given to the manager in regard to asset allocation ranges. The result of these skills are shown for multiple time periods. The top section shows the returns for both the account and the investment policy and the results of the manager's contribution. The fund's return is thus attributed to the policy and the manager. The bottom section divides the manager's contribution into two components: asset allocation and security selection. The asset allocation effect measures the value that was added by varying the actual asset allocation from the target allocation. This is done by assuming investments, in amounts equal to the actual asset allocation weights, were made in the policy's indices so that security selection has no effect. The difference between this return and the policy's return is the asset allocation effect. The security selection is the remainder of the manager's contribution that is not explained by asset allocation. 17 Palm Beach Gardens Firefighters` Pension Plan Attribution of Returns Attribution of Performance to show Manager Contribution Policy + Manager Contribution = Fund Attribution of Manager Contribution between Asset Allocation and Security Selection Asset Allocation Security Selection Manager Contribution: Current Quarter Policy : i lanager:Gon ib 4tion.: Fund Current Quarter -1.08 :? .... .................... .... ... .... ... >. >:.':::':.:: _0:07: ............................... ............. ............................... ............................... ............................... ............................... -1.15 Year to Date 6.57 ... .............. .. ... ............ ... .... ................. ............................... .................... ................ .......... ..................... :: :::::: :: = 1:;$3: ...................... .............................. .......... ............... . .......... ... . ................ . 4.74 3 Years 8.02 :.: . ...................... . ... ............................... ... ............................... ......... :.:..:..:...;..: .:.:.b:3. .... . ........ . .. ........ ............ ...... ......... ........... ............. ... ...... 8.36 5 Years 10.26 :.:......:.....:: 0:31 10.57 9 Years 4.71 :...:::... . .. ............................. ............................ ... ............................... . .. <....... - 0:40. ............................... .... ...... ............................... :.:: 4.31 Incept 5.45 :..::.:..:..::: :: ;= 0:37. 5.08 Policy + Manager Contribution = Fund Attribution of Manager Contribution between Asset Allocation and Security Selection Asset Allocation + Security Selection = Manager Contribution ASVF- Investment 7/5/2006 $210 000., Galliard $3 M 7/2/07, Index change effective 10 -01 -2007 From LB G/C Int, to LB INt. Aggregate 18 Asset Allocation Security Selection Manager Contribution: Current Quarter -0.41 0.34 Year to Date -3.50 1.67 3 Years -3.11 3.45 . 0:34 5 Years -4.06 4.37 g:: 9 Years -2.11 1.71 =0:4n: Incept -2.49 2.12 :.:: :::: -: :::.: r0:3:: Asset Allocation + Security Selection = Manager Contribution ASVF- Investment 7/5/2006 $210 000., Galliard $3 M 7/2/07, Index change effective 10 -01 -2007 From LB G/C Int, to LB INt. Aggregate 18 15.00% p 10.00% e r c e 5.00% n t E 0.00% f f e c - 5.00% t - 10.00% 15.00% p 10.00% e r c e 5.00% n t E 0.00% f f e t -5.00% - 10.00% Palm Beach Gardens Firefighters' Pension Plan Asset Allocation Effect I I I I I I I I I I I I RAM In'l Cn9 nnQ RAnn in• cn I - -- - -- -• - -• t J ovu vuO MUD Jut) bub UOb M07 J07 S07 D07 Quarter Ending Security Selection Effect I I I I I I I I I M03 Ina sns nn4 RAnA MA enn nn• .1— -- • -- • w, rviuu quo OVO Uub MU/ J07 S07 I Quarter Ending Quarterly Effect Cumulative Effect ASVF- Investment 7/5/2006 $210 000., Galliard $3 M 7/2/07, Index change effective 10 -01 -2007 From LB G/C Int, to LB INt. Aggregate 19 Palm Beach Gardens Firefighters' Pension Plan Asset Allocation vs Targets 80.00%------- 70.00% - - ------------ ---- -------- - -- -- - ---- -- ------ --- -- ------------ ------------------ - I -- ----------- 60.00°/ ------------ - -- - -------- - - - - -- --- - --------- 11 --- - ------ ------------------- - 50.00% ------------- ---- ----- ------------ -- ---------- -- -------- - ----- ---------- ----- - - - - -- -- - -- - 40.00% ----------------------- ----------- - - ------------------- --- -- --- ------ --- ------ 0 30.00% -------------------- -------- ------ --- ------------------------------------ -- ------------------------ -------- -- 20.00°/ ----------- --- - ---------- - - ---------------- - - - -- ---------------------------- ---------- 10.00% ------------ ----------- -- ---- - ------------------ -- ---------- ---------------- ---0.000 va� M03 J03 S03 D03 M04 J04 SO4 D04 M05 J05 S05 D05 M06 J06 S06 D06 M07 J07 S07 D07 Quarter Ending Cash& Equiv Target 80.00OX /1 70.00 %--- - - - - -- - ------------------------------- 60.00%- 50.00%- 40.00% 30.00%-- 20.00% - 10.00% - 0.00% M03 J03 S03 D03 M04 J04 SO4 L"4 MUO JU!) 605 U05 M06 J06 S06 D06 M07 J07 S07 D07 Quarter Ending FE Equi�ty—)K—�-Target 80.00% 70.00%---------------------- - - - - -- ---- ------------------------------------ ----- -------------------------------------------- ----- --- --------------------------------------- 60.00% --------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------- 50.00% ------------------------------------------------------------------------------------------------------------------ 40.00% - ----------------------------------------------------------------------------------------------------------------------------------------------------------------------- 30.00%- 20.00%- 7 10.00%- 0.00%- M03 J03 S83 D103 M04 J04 SO4 D04 M05 J05 S05 D05 M06 J06 S06 D06 M07 J07 S07 D07 Quarter Ending ❑ Fixed Income —X— Target ASVF- Investment 7/5/2006 $210 000., Galliard $3 M 7/2/07, Index change effective 10-01-2007 From LB G/C Int, to LB INt. Aggregate 2n 80. 70. 60. 50. 40. 30. 20. 10. 0. 70 30. 10. 0. Palm Beach Gardens Firefighters' Pension Plan Asset Allocation vs Targets /o - - -- -------------- - - - - -- - -- -------------------- - - - - -- _- - - -- -- - -- ---------- - - - - -- -- - - -- - -- - - - - -- - - - - - /a ---------------------- - - - - -- ---------------------- - - - - -- -- - - - - - - - - - -- /o ------------------- - - - - -- ------ - - - - -- _ - - - -- - -- - -- I -- -------- - - -- - - -- - - - -- - -- I ------------------------------------------------------- - - - - -- ---- - - - - -- - { / --------------------------------------------- - - - - -- --- - - - - -- -- - - -- - - - - - -- ------------------ - --- ------- - / ----------------------------------------------------- - - - - -- - -- - - - -- -- - - - - - -- ------- - - - - -- - - .. - ... / ------------------------------------------------- - - - - -- -------- - - - - -- -------------- - - - - -- X A--- /o 3 J 3 S 3 D 3 4 J 4 S 4 D 4 5 J 5 S05 D05 M06 J06 S06 D06 M07 J07 S07 D07 Quarter Ending InYI —Y, Target Quarter Ending FM REF —)K— Target ASVF- Investment 7/5/2006 $210 000., Galliard $3 M 7/2/07, Index change effective 10 -01 -2007 From LB G/C Int, to LB INt. Aggregate 21 Palm Beach Gardens Firefighters` Pension Plan Manager Contribution 2.50% -- - - - -- — -- - - 2.00% i----- - - - - -- 1.50% 1.00% R e 0.50% t U 0.00% r n -0.50% -1.00% -1.50% -2.00% MUJ JUJ SUJ UUJ MU4 JU4 5U4 DU4 M05 J05 S05 D05 M06 J06 S06 D06 M07 J07 S07 D07 Quarter Ending Quarterly Cumulative Growth of $100 Fund Vs Policy V $ a u $ e UU[ MUJ JU3 SUJ UUJ MU4 JU4 SU4 DU4 M05 J05 S05 D05 M06 J06 S06 D06 M07 J07 S07 D07 Quarter Ending ❑ Fund ❑ Policy ASVF- Investment 7/5/2006 $210 000., Galliard $3 M 7/2/07, Index change effective 10 -01 -2007 From LB G/C Int, to LB INt. Aggregate 22 Palm Beach Gardens Firefighters' Pension Plan Quarterly Comparison Analysis ($) Period Ending Fund Policy Diff Nominal 8% Diff CPI + 3% Diff Apr 1998 2,994 2,994 0 2,994 0 2,9941 0 Jun 1998 3,120 3,092 28 3,066 54 3,051 69 Sep 1998 3,209 3,177 32 3,346 -137 3,302 -93 Dec 1998 3,677 3,676 1 3,507 171 3,425 252 Mar 1999 3,729 3,755 -25 3,558 172 3,454 275 Jun 1999 3,854 3,911 -58 3,638 216 3,515 339 Sep 1999 3,968 3,987 -19 3,934 34 3,801 167 Dec 1999 4,329 4,421 -92 4,095 234 3,926 403 Mar 2000 4,745 4,833 -88 4,471 274 4,320 425 Jun 2000 4,808 4,861 -54 4,635 172 4,459 348 Sep 2000 5,058 5,119 -61 4,958 101 4,756 303 Dec 2000 5,171 _ 5,161 10 5,263 -92 5,008 163 Mar 2001 4,929 4,989 -61 5,544 -616 5,285 -356 Jun 2001 5,243 5,330 -87 5,794 -551 5,524 -281 Sep 2001 5,168 5,237 -70 6,282 -1,115 5,951 -783 Dec 2001 5,548 5,678 -130 6,478 -930 6,014 -466 Mar 2002 5,885 6,008 -123 6,927 -1,042 6,455 -570 Jun 2002 5,468 5,572 -104 7,092 -1,624 6,579 -1,111 Sep 2002 5,686 5,607 80 7,843 -2,157 7,280 -1,593 Dec 2002 5,798 6,045 -246 8,086 -2,287 7,423 -1,624 Mar 2003 6,111 6,345 -233 8,636 -2,525 8,007 -1,896 Jun 2003 6,976 7,265 -290 9,042 -2,066 8,280 -1,305 Sep 2003 7,723 7,996 -273 9,821 -2,098 9,012 -1,289 Dec 2003 8,545 8,841 -296 10,222 -1,676 9,240 -695 Mar 2004 9,060 9,251 -191 10,668 -1,608 9,706 -646 Jun 2004 9,337 9,654 -317 11,247 -1,910 10,268 -931 Sep 2004 10,055 10,296 -241 12,144 -2,089 11,032 -977 Dec 2004 10,833 11,109 -276 12,560 -1,727 11,314 -481 Mar 2005 11,514 11,586 -71 13,471 -1,956 12,250 -735 Jun 2005 11,868 11,851 17 13,803 -1,934 12,497 -628 Sep 2005 13,656 13,449 207 15,297 -1,641 14,103 -447 Dec 2005 13,923 13,825 98 15,733 -1,810 14,204 -281 Mar 2006 14,962 14,780 181 16,470 -1,508 14,970 -8 Jun 2006 15,787 15,501 286 17,650 -1,863 16,184 -397 Sep 2006 17,227 17,141 86 19,006 -1,779 17,312 -85 Dec 2006 18,826 1 18,835 -9 20,155 -1,329 18,131 695 Mar 2007 19,3751 19,203 172 20,601 -1,226 18,629 746 All dollar values are shown in thousands. ASVF- Investment 71512006 $210 000., Galliard $3 M 7/2107, Index change effective 10 -01 -2007 From LB G/C Int, to LB INt. Aggregate 23 Palm Beach Gardens Firefighters' Pension Plan Quarterly Comparison Analysis ($) Period Ending Fund Policy Diff Nominal 8% Diff CPI + 3% Diff Jun 2007 21,166 21,197 -32 22,244 -1,078 20,274 892 Sep 2007 22,444 22,822 -377 23,869 -1,424 21,674 770 Dec 2007 22,624 23,012 -389 24,780 -2,156 22,433 191 All dollar values are shown in thousands. ASVF- Investment 7/5/2006 $210 000., Galliard $3 M 7/2/07, Index change effective 10 -01 -2007 From LB G/C Int, to LB INt. Aggregate 24 Palm Beach Gardens Firefighters' Pension Plan Quarterly Comparison Analysis ( %) Period Fund Policy Diff Nominal 8% Diff CPI + 3% Diff Ending I Sep 1998 -3.86 -4.06 0.20 1.94 -5.80 1.04 -4.90 Dec 1998 11.46 12.57 -1.11 1.94 9.52 0.84 10.62 Mar 1999 1.91 2.62 -0.71 1.94 -0.03 1.34 0.57 Jun 1999 3.05 3.89 -0.84 1.94 1.11 1.44 1.61 Sep 1999 -2.63 -3.53 0.90 1.94 -4.57 1.74 -4.37 Dec 1999 6.91 8.69 -1.78 1.94 4.97 1.04 5.87 Mar 2000 2.64 2.50 0.14 1.94 0.70 2.45 0.19 Jun 2000 -0.32 -1.02 0.70 1.94 -2.26 1.44 -1.76 Sep 2000 0.43 0.56 -0.13 1.94 -1.51 1.44 -1.01 Dec 2000 -1.82 -3.15 1.33 1.94 -3.76 0.94 -2.76 Mar 2001 -8.12 -6.76 -1.36 1.94 -10.06 1.95 -10.07 Jun 2001 3.51 4.00 -0.49 1.94 1.57 1.85 1.66 Sep 2001 -8.16 -8.33 0.17 1.94 -10.10 0.94 -9.10 Dec 2001 5.90 6.97 -1.07 1.94 3.96 -0.16 6.06 Mar 2002 0.24 0.11 0.13 1.94 -1.70 1.95 -1.71 Jun 2002 -7.59 -7.75 0.16 1.94 -9.53 1.44 -9.03 Sep 2002 -6.79 -9.82 3.03 1.94 -8.73 1.34 -8.13 Dec 2002 0.41 6.20 -5.79 1.94 -1.53 0.74 -0.33 Mar 2003 -1.35 -1.54 0.19 1.94 -3.29 2.55 -3.90 Jun 2003 10.22 10.74 -0.52 1.94 8.28 0.44 9.78 Sep 2003 2.05 1.76 0.29 1.94 0.11 1.54 0.51 Dec 2003 7.84 7.86 -0.02 1.94 5.90 0.24 7.60 Mar 2004 3.12 1.86 1.26 1.94 1.18 2.35 0.77 Jun 2004 -1.00 0.36 -1.36 1.94 -2.94 1.95 -2.95 Sep 2004 0.38 -0.39 0.77 1.94 -1.56 0.84 -0.46 Dec 2004 5.90 6.10 -0.20 1.94 3.96 0.94 4.96 Mar 2005 0.23 -1.62 1.85 1.94 -1.71 2.35 -2.12 Jun 2005 2.46 1.68 0.78 1.94 0.52 1.44 1.02 Sep 2005 4.67 3.13 1.54 1.94 2.73 2.96 1.71 Dec 2005 0.93 1.75 -0.82 1.94 -1.01 -0.26 1.19 Mar 2006 4.35 3.78 0.57 1.94 2.41 2.35 2.00 Jun 2006 -0.17 -0.86 0.69 1.94 -2.11 2.35 -2.52 Sep 2006 2.64 3.97 -1.33 1.94 0.70 0.74 1.90 Dec 2006 4.73 5.30 -0.57 1.94 2.79 0.24 4.49 Mar 2007 2.63 1.67 0.96 1.94 0.69 2.45 0.18 Jun 2007 2.80 3.86 -1.06 1.94 0.86 2.15 0.65 Sep 2007 0.43 2.04 -1.61 1.94 -1.51 1.04 -0.61 Returns for periods exceeding one year are annualized. ASVF- Investment 7/5/2006 $210 000., Galliard $3 M 7/2/07, Index change effective 10 -01 -2007 From LB G/C Int, to LB INt. Aggregate 1) rZ Palm Beach Gardens Firefighters` Pension Plan Quarterly Comparison Analysis ( %) Period Fund Policy Diff Nominal 8% Diff CPI + 3% Diff Ending Dec 2007 -1.15 -1.08 -0.07 1.94 -3.09 1.44 -2.59 Incept. 5.08 5.45 -0.37 8.00 -2.92 5.71 -0.63 Returns for periods exceeding one year are annualized. ASVF- Investment 7/5/2006 $210 000., Galliard $3 M 7/2/07, Index change effective 10 -01 -2007 From LB G/C Int, to LB INt. Aggregate 9 F Palm Beach Gardens Firefighters` Pension Plan Risk Measures Report Explanation The evaluation of a fund's performance should extend beyond return to encompass measures of risk. The next two pages are used to determine the level of risk to which the fund has been exposed, and whether the return has been commensurate with the risk taken. All measures are calculated for both the fund and the policy as well as the difference between the two. Up to four time periods are evaluated depending on the age of the fund. # Of Negative Qtrs /# Of Positive Qtrs: Number of negative quarters shows the number of quarters in which the return was less than zero, and the number of positive quarters is the number of quarterly returns which were greater or equal to zero. Batting Average: The batting average is a measure of consistency. It shows the percent of the quarters the fund has beaten the policy and the percent of the quarters the policy has beat the fund. A high average for the fund (e.g. over 50) is desirable, indicating the fund has beaten the policy frequently. Worst Quarter /Best Quarter /Range: The worst quarter is the lowest quarterly return experienced during the period, a measure of downside risk. The best quarter is the highest quarterly return, and the range is the difference of the high and low, and indicates dispersion. Standard Deviation: Standard deviation measures the total volatility of the fund, by measuring dispersion. Higher standard deviation indicates higher risk. If the quarterly or monthly returns are all the same the standard deviation will be zero. The more they vary from one another, the higher the standard deviation. Thus, it measures uncertainty, which is a measure of risk. Alpha /Beta /R- Squared: If the policy is appropriate, then the alpha should be positive, the beta close to one, and the r- squared should be high. Beta measures risk relative to the policy. A beta of 1 suggests risk equivalent to the policy. Higher betas indicate higher relative risk. A beta of 1.2 indicates 20% more risk than the policy. The alpha measures the return adjusting for beta. The higher the alpha, the better. R- squared measures the relationship between the policy and the fund. A high r- squared means the returns of the fund can largely be explained by movements of the policy. The higher the r- squared, the more reliable the alpha and the beta. R- squared may range from 0 to 100. Beta, alpha and r- squared are derived from regression analysis using the fund and policy returns as the dependent and independent variables respectively. Roughly, one would expect the fund's performance to equal the return of the policy multiplied by the beta plus the alpha. Sharpe Ratio / Treynor Ratio: The Sharpe and Treynor ratios are similar. The Sharpe ratio is the excess return per unit of total risk as measured by standard deviation. The Treynor ratio is the excess return per unit of market risk as measured by beta. Both of these should be compared against the corresponding value for the policy. Higher numbers are better, indicating more return for the level of risk that was experienced. 27 Palm Beach Gardens Firefighters' Pension Plan Risk Measures 3 Yr Fund Policy D ff # of Negative Qtrs 2.00 3.00 1.00 # of Positive Qtrs 10.00 9.00 1.00 Batting Average 50.00 50.00 0.00 Worst Qtr -8.16 -9.82 1.66 Worst Qtr -1.15 -1.62 0.47 Best Qtr 4.73 5.30 -0.57 Range 5.88 6.92 -1.04 Worst 4 Qtrs 4.74 4.98 -0.24 Standard Deviation 3.96 4.42 -0.46 Beta 0.78 1.00 -0.22 Annualized Alpha 1.13 0.00 1.13 R- Squared 0.71 1.00 -0.29 Sharpe Ratio 1.06 0.87 0.19 Treynor Ratio 5.38 3.86 1.52 Tracking Error 2.30 0.00 2.30 Information Ratio 0.15 ................... ....... 9: yr ............ Fur3d ........... Policy. ...... ... . Diff:. # of Negative Qtrs 11.00 12.00 -1.00 # of Positive Qtrs 25.00 24.00 1.00 Batting Average 50.00 50.00 0.00 Worst Qtr -8.16 -9.82 1.66 Best Qtr 10.22 10.74 -0.52 Range 18.38 20.56 -2.18 Worst 4 Qtrs -14.67 -13.91 -0.76 Standard Deviation 8.45 9.37 -0.92 Beta 0.86 1.00 -0.14 Annualized Alpha -0.25 0.00 -0.25 R- Squared 0.91 1.00 -0.09 Sharpe Ratio 0.10 0.13 -0.03 Treynor Ratio 0.99 1.25 -0.26 Tracking Error 2.87 0.00 2.87 Information Ratio -0.14 51 Yr Fund Policy DO l # of Negative Qtrs 4.00 5.00 -1.00 # of Positive Qtrs 16.00 15.00 1.00 Batting Average 50.00 50.00 0.00 Worst Qtr -1.35 -1.62 0.27 Best Qtr 10.22 , 10.74 -0.52 Range 11.57 12.36 -0.79 Worst 4 Qtrs 4.74 4.36 0.38 Standard Deviation 6.11 6.44 -0.33 Beta 0.91 1.00 -0.09 Annualized Alpha 0.88 0.00 0.88 R- Squared 0.91 1.00 -0.09 Sharpe Ratio 1.25 1.14 0.11 Treynor Ratio 8.37 7.31 1.06 Tracking Error 2.00 0.00 2.00 Information Ratio 0.16 .......... ... ..... an�ept Fund policy Diff: # of Negative Qtrs 12.00 13.00 1.00 # of Positive Qtrs 26.67 25.67 1.00 Batting Average 50.87 49.13 1.74 Worst Qtr -8.16 -9.82 1.66 Best Qtr 11.46 12.57 -1.11 Range 19.62 22.39 -2.77 Worst 4 Qtrs -14.67 -13.91 -0.76 Standard Deviation 8.94 9.86 -0.92 Beta 0.87 1.00 -0.13 Annualized Alpha -0.15 0.00 -0.15 R- Squared 0.92 1.00 -0.08 Sharpe Ratio 0.17 0.19 -0.02 Treynor Ratio 1.74 1.88 -0.14 Tracking Error 2.79 0.00 2.79 Information Ratio -0.13 ASVF- Investment 7/5/2006 $210 000., Galliard $3 M 7/2/07, Index change effective 10 -01 -2007 From LB G/C Int, to LB INt. Aggregate 28 8.50% 8.00% 7.50% 7.00% A n u 6.50% a I i z 6.00% e d R e 5.50% t u r n 5.00% 4.50% 4.00% 3.50°0 6.Ou ro Palm Beach Gardens Firefighters' Pension Plan Return vs Risk through December 31, 2007 0.uu1/0 10.00% 15.00% 20.00% 25.00% Risk (Annualized Std Dev) Policy ASVF- Investment 7/5/2006 $210 000., Galliard $3 M 7/2/07, Index change effective 10 -01 -2007 From LB G/C Int, to LB INt. Aggregate Vel 25.00% 20.00% R 15.00% e t r 10.00% n s 5.00% Pala Beach Gardens Firefighters' Pension Plan Return vs Risk through December 31, 2007 3 Years X I Ound -.- (&0 -- I W3 Mo Mill ALB Gov /Corp EAFE 0.00% 1 1 1 1 1 1 1 1 1 1 1 1 1.00% 3.00% 5.00% 7.00% 9.00% 0.00% 2.00% 4.00% 6.00% 8.00% 10.00% Risk (Annualized Std Dev) 9 Years 8.50% - 8.00% 7.50% MSCI EAFE 7.00% 6.50% R e 6.00% u 5.50% LB Gov /Corp r 5.00% n s 4.50% X 4.00% Fund R3000 3.50% XS &P 500 3 Mo TBill 3.00% 5.00% 15.00% 25.00% 0.00% 10.00% 20.00% Risk (Annualized Std Dev) 30.00% 25.00% 20.00% R e t 15.00% u r n 10.00% S 5.00% f 5 Years Fund X X LB Gov /Corp 3 Mo TBill 0.00% L - I - L- 1 -- 5.00% 15.00% 0.00% 10.00% 20.00% Risk (Annualized Std Dev) X MSCI 8.50% 8.00% 7.50% 7.00% R 6.50% e t 6.00% r 5.50% s 5.00% 4.50% 4.00% 3.50% Inception XLB Gov /�orp CIE and i %, MSCI R3000 S &P 500 0.00% 10.00% 20.00% Risk (Annualized Std Dev) Policy ASVF- Investment 7/5/2006 $210 000., Galliard $3 M 7/2/07, Index change effective 10 -01 -2007 From LB G/C Int, to LB INt. Aggregate 30 Palm Beach Gardens Firefighters' Pension Plan Policy: 04/30/1998- 12/31/2000 60.00 S &P 500 35.00 Lehman Gov /Credit Bond 5.00 Citigroup Treasury Bill - 3 Month 01 /0 1/2001-03/3 1 /2003 65.00 S &P 500 30.00 Lehman Gov /Credit Bond 5.00 Citigroup Treasury Bill - 3 Month 04/01/2003-06/30/2005 65.00 S &P 500 30.00 Lehman Gov /Credit - Intermediate 5.00 Citigroup Treasury Bill - 3 Month 07/01/2005- 09/30/2007 55.00 Russell 3000 30.00 Lehman Gov /Credit - Intermediate 10.00 MSCI EAFE 5.00 Citigroup Treasury Bill - 3 Month 10/01/2007 - 12/31/2007 55.00 Russell 3000 30.00 Lehman U.S. Aggregate Intermediate 10.00 MSCI EAFE 5.00 Citigroup Treasury Bill - 3 Month First Objective: 04/30/1998 - 12/31/2007 Annual Return of 8.00% Second Objective: 04/30/1998- 12/31/2007 100.00 US Consumer Price Index + 3.00 annual adder Universe Data: 55% PLCC,30% Hg Quality Bd,10% Int'l, 5% Cash 04/30/1998 - 12/31/2000 35.00 High Quality Bond 60.00 Pure Large Cap Core 5.00 Taxable Money Market 01 /01 /2001- 06/30/2005 30.00 High Quality Bond 65.00 Pure Large Cap Core 5.00 Taxable Money Market 07/01/2005- 12/31/2007 30.00 High Quality Bond 55.00 Pure Large Cap Core 10.00 International Equity 5.00 Taxable Money Market 31 MSCI EAFE MSCI Emerg. Mkts. S&P 500 Russell 3000 Russell 1000 Russell 2000 Lehman US Agg. Lehman US Gov. Lehman MBS Fixed Lehman US Credit 3mos. T-Bill The Market Environment Asset Class Performance Period Ended: December 31, 2007 FQ—Uarter Performance -6.0% -3.0% 0.0% 3.0% 6.0% Source: MSCI Capital Markets, Russell Co., HFR, Lehman, & Bogdahn Consulting, LLC. MSCI EAFE MSCI Emerg. Mkts. S &P 500 Russell 3000 Russell 1000 Russell 2000 Lehman US Agg. Lehman US Gov. Lehman MBS Fixed Lehman US Credit 3mos. T-Bill Year-to-Date Market Performance -5.0% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% -IN � MSCI EAFE MSCI Emerg. Mkts. S &P 500 Russell 3000 Russell 1000 Russell 2000 Lehman US Agg. Lehman US Gov. Lehman MBS Fixed Lehman US Credit The Market Environment Asset Class Performance Period Ended: December 31, 2007 ( Pive Year Annualized Performance 3mos. T-Bill _ 3.0y6 i 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% .Cnitrra• MRri ranifial AAarkatc Ru"o-1 (n HFR 1 ahman ritirnrn R Rnnrlahn rnn.,zidtinn I I r Ten Year Annualized Performance MSCI EAFE MSCI Emerg. Mkts. S&P 500 Russell 3000 Russell 1000 Russell 2000 Lehman US Agg. Lehman US Gov. Lehman MBS Fixed Lehman US Credit 3mos. T-Bill 0.0% 3.0% 6.0% 9.0% 12.0% 15.0% ENERGY MATERIALS INDUSTRIALS CONSUM FR DISCR CONSUM ER STAPLES HEALTH CARE FINANCIALS INFORMATION TECH TELECOM SVC UTILITIES The Market Environment Equity Sector Performance Period Ended: December 31, 2007 Sector Performance as of 12/31/2007 5.0% 34.4% 1.4 2t 6.5% -3.8% % 13.4% -10.4% -11.4% "3.4% 13.9% 8.0% -13.0% - 17.3% -0.5% 15.1% -6.0% 10.5% �� 6.5% O QTD n I KTD] 17.5% Source: MSCIBarra & Bogdahn Consulting, LLC. The Market Environment Equity Style Performance Period Ended: December 31, 2007 Source: Frank Russell Co. Russell All Cap Style Performance 25 - -- - - - - -- - - - 20 12.413.6 14.7 lb - _ _ _ 11:4 11.4 10 5.1 8.6 8.9 9.0 5.1 6.2 7.7 5 3.8 0 6 -0.9 -:3.3 - -1.0 -1.0 -10 - -5.9 - - - - Qtr YTD lyr Syr Syr 10yr ❑ 3000 Growth a 3000 Index ■ 3000 Value Russell Large Cap Style Performance 25 -- -- - -- - - -- - - -- -- - -- -- -- - - -- - -- -- , 20 14.6 15 11.8 11.8 12.1 - - -13.4 - 10 b.8 8.7 9.1 9.3 5.8 6 -2 7.7 5 3.8 - - 0.2 -0.2 0 6 0.8__3.2 - - - -10 -6.8 - -16 - - - - - -- Qtr YTD lyr 3yr 5yr I 10yr ❑ 1000 Growth B 1000 Index ■ 1000 Value Russell Small Cap Style Performance 26 -- - - - -- - - - - - -- - -- - - - 20 16.5 16.3 1b.8 15 10 7.1 7.1 8.1 6.8 b.3 7.1 9.1 4.3 5 F M I 0 - L- •b 2.1 1.6 •1.6 10 4.6 7.3 -lb - 9.8 -9.8 - - - - - -- - Qtr YTD lyr 3yr 5yr 10yr ❑ 2000 Growth 0 2000 Index 02000 Value 30.0% 20.0% 10.0% 0.0% -10.0% - 20.0% -30.0% r 00 00 ro m CO ao 00 m 00 00 rn rn rn m rn rn rn rn rn rn o 0 0 0 0 0 0 0 rn rn rn rn rn rn rn m rn rn rn rn rn rn rn rn rn rn rn rn rn o 0 0 0 0 0 0 0 —Value Growth Source: Frank Russell Co. & Bogdahn Consulting, LLC. The Market Environment Trends for Stocks and Bonds Period Ended: December 31, 2007 Growth vs. Value Russell 1000 Excess Return Rolling 12 Month Periods 7 6 5 4 3 2 1 0 Treasury Yield Curve O 1 mo 3 mo 6 mo 1 yr 2 yr 3 yr 5 yr 7 yr 10 yr 20 yr 30 yr Source: US Dept. of Treasury -L', 12/31/2007 -�- 12/29/2006 T t V rr� `J w V ct fi.. t l^ 4� 5 4� 4� CJ z vi 00 0 j N z .� z �+ z a 0 0 z w Ir zQ D U z O 0 Q 0 N 4-J 4� O O N UO CC cz Cz cz o O ,�-+ ^ J••+ >C Lr) 71 o '-� Q ° cz V '-C� ^� ,� CSC UQ y� �i ON N Q O 1-4 ' � o d z . U1 ° • � .x �, U �, o � > a� a� ° 't7 0 u1 .0 P-4 � '� CIO 'C14 :. CC dip O �-+ CZ U) J 7� Cz O � J o O Q�, .� cz v o o CZ u cz v�v)ww P4 cz �. C) U � U z O 0 Q 0 N `1 �1 O W vJ 4� 4� G� �A w C� i.i cz C.) MM4� F+� cti w O A ;I O O O O C4 a) U i-r O � N � O U N � O Cn O D CC 4� CSi N V) C) O L U _� CC c�C 4-J N M O 4� CC N w U z 0 5 Q z zd O rli N � � � O� M 00 06 V) C) O L U _� CC c�C 4-J N M O 4� CC N w U z 0 5 Q z zd O rli h� yam/, C!� Q.% it u G� .I-.+ Vr 4� i.r lr _� l� rCLS V U cCS l 1M�1 �i ^^ctS� k F� F Li a� y w 0 O C.J 4� cC 3� G U ^J W U ct N � O O � O O � � O � O p Q v H O O O N M rl � O O � N v 0 ao N � N E-� 0 0 N O p � � O O M O N 'C3 M 0 U O o U N .-. 0 � o M d- � M M M 0 �n O O N N w i-. N W a� Li. 0 M 0 O N O O O 0 N O J a3 C5 L cri D Q o 0 o, o � U U � a� U c 0 o M O M � O L O � 4 v bD cz v «3 s \ � U 'D �O ^T U ro it u u u ro ct . v a ro L 0 r_ 0 v 0 .n v .a v C ro ro u u u ro v 0 v G G c -v v L ro x V w 6J o z cQ Uj C a 4 w � > Z Q ..0 H w U) Z Q 'C3 U U � Q) 'C3 J a3 C5 L cri D Q o 0 o, o � U U � a� U c 0 o M O M � O L O � 4 v bD cz v «3 s \ � U 'D �O ^T U ro it u u u ro ct . v a ro L 0 r_ 0 v 0 .n v .a v C ro ro u u u ro v 0 v G G c -v v L ro x V w 6J o z cQ Uj C a 4 w � > Z Q ..0 H w U) Z Q V V v G H 0 c 0 b 3 a G ct U V et cz v 0 ti v .v v c .a G G O a v cz x .v C O .o C GJ _C U z a G Q z LL) V) z 0 krl ,o �i 00 U y M � U o c � •� Q a� U n cn 00 N ..� ct 4—' N a� ..iii • � U � .^ 6I3 c� 03 O a� O U► N O c� O �r ° • p.� O 7 O C 00 V V v G H 0 c 0 b 3 a G ct U V et cz v 0 ti v .v v c .a G G O a v cz x .v C O .o C GJ _C U z a G Q z LL) V) z 0 krl Worldwide equity markets started the fourth quarter of 2007 with positive momentum, but by late November, most domestic equity indices had corrected 5 -7% from their starting points. Foreign mar- kets fared slightly better, but also fell 1 -2% during the same time frame. The markets experienced a modest rebound in late December, but this was not enough to prevent most U.S. and foreign equity indi- ces from showing negative returns in Q4. The news is more positive when looking at annual returns for 2007, as the S &P 500 provided a positive total return (including dividends) of roughly 5.5 %. Small cap stocks did not fare as well, as the Russell 2000 finished the year down almost 2 %. From a style perspective, 2007 marked a significant inflection point in the performance of growth vs. value oriented shares. Growth indices such as the Russell 1000 Growth and Russell 2000 Growth returned +11.8% and +7.0% respectively in 2007. Meanwhile, value indices struggled, as the Russell 1000 Value and Russell 2000 Value had nega- tive returns of (.2 %) and (9.8 %) in 2007. S&P 500 Laggards in 2007 Home Builders -59.6% Thrifts & Mortgage Finance -51.2% Real Estate Management -36.4% Department Stores -352% Motorcycle Manufacturers -33.7% Regional Banks -31.5% Apparel & Accessories -31.0% Home Improvement Retail -29.7% Consumer Finance -29.6% Diversified Financials -29.5% within in the growth indices. The table at left helps illus- trate why there was such a dramatic divergence in per- formance of growth vs. value shares. Almost all of the worst performing industry groups in 2007 have a higher representation within value - oriented vs. growth portfolios. Meanwhile, the best perform- ing stocks were clustered within the Aerospace/ Defense, Oilfield Service, Computer Software & Inter- net industries, all of which have higher representation Consumer Discretionary and Financials were the only sectors within the S&P 500 that experienced negative returns in 2007. Energy led the S &P 500 last year, up over 32 %, and four other sectors produced positive returns of 15% or snore. The divergence in the performance of the sectors within the S &P had a material impact on the overall composition of the index. Financials representation within the index has fallen by 5% in just one year. Meanwhile, Energy has risen by almost 3 %, and the Technology and Consumer Staples also grew their representation by 1% or more in 2007. . Investors should be aware that the S &P 500 has clearly become a "growthier" index in a rather short period of time. This will probably have positive implications for the near -term performance of the S &P 500, as the index now has higher weighting towards some of the sec- tors that are likely to post the strongest and most consistent earnings growth in 2008. Dana Equity Strategies Total Return through 12- 31.07* S&P 500 Sector Breakdown Comparison of Beginning vs. End of Year 2007 3 Yrs 5 Yrs Sector - 3.21`Yo Sector Change 14.93% Weight % 2007 Weight % in Sector 17.13% 12/31/06 Performance 12/31/07 Weight % Energy 9.8% 32.38% 12.9% 3.1% Materials 3.0% 19.99% 3.3% 0.4% Utilities 3.4% 15.81% 3.4% 0.0% Information Technology 15.1% 15.53% 16.8% 1.6% Consumer Staples 9.3% 11.60% 10.3% 1.0% Industrials 10.9% 9.83% 11.5% 0.6% Teleoommuniations 3.5% 8.45% 3.6% 0.1% Health Care 12.0% 5.90% 12.0% 010% Consumer Discretionary 10.6% 14.32% 8.5% -2.1% Financials 22.3% 10.84% 17.7% 4.6% Total 100.0% 5.49% 100.0% Dana Equity Strategies Total Return through 12- 31.07* Q44, YTD 3 Yrs 5 Yrs Dana Large Cap - 3.21`Yo 5.71% 11.06% 14.93% Dana Large Growth 0.87% 15.40% 13.12% 17.13% Dana Large Value 4.10% 4.87% 11.19% 16.51% Dana All Cap 4.22% 3.68% 9.55% 15.32% Dana Small Cap - 10.59% -8.42% 3.93% 14.23% Dana Socially Responsible 4.47% 7.62% 10.97% 18.15% Dana lnt'l ADR 2.04% 10.70% N/A N/A Preliminary as of 1 -21 -08 Most of Dana's equity strategies navigated the volatile markets of 2007 fairly well, while a few had a more difficult time. Small caps did not join the party in 2007, and the small cap market also experi- enced an escalation in volatility. Dana's Small Cap strategy mirrored these trends. The Small Cap portfolio's tilt towards value stocks also weighed on performance. The Russell 2000 Value index returned - 9.8% in 2007, while the Russell 2000 Growth index was up over 7 %. Our team is presently focusing on companies with international ex- posure, attractive growth characteristics and a history of positive earnings surprises along with appealing valuations and improving fundamentals. Dana's Large Value, Large Growth and Socially Responsible strate- gies generated strong absolute and relative returns for the year. r— The Large Value and Social strategies derived their strongest relative performance contribution from holdings within the Financial sector. Our team's quantitative and fundamental models began to flash cau- tion signs on many financial stocks last summer. We responded by reducing our portfolios' exposure to those stocks deemed most vul- nerable if the U.S. residential housing market continued to deterio- rate. For example, State Street Bank (STR which derives most of its earnings from asset management and investment custody services, was added to a number of our equity strategies during the year. State Street appreciated over 20% in the fourth quarter of 2007. Several other financials added to portfolios in the latter half of the year also generated positive returns. As a result, Dana's equity portfolios we were largely able to avoid the collapse in many of the financials that fared the worst from the collapse of the sub -prime mortgage market. Another factor that was accretive to the performance of many strate- gies was the recognition of the market's shift in preference from value towards growth- oriented companies. We were able to "tilt" many of the portfolios towards growth while still maintaining our strict relative valuation discipline. It also became clear that the con- tinuation of the weak dollar would likely have a positive impact for many large U.S. multi- nationals and other export- related companies. As a result, we placed a higher priority on investing in companies with strong or rapidly growing foreign revenue streams. Companies with a high percentage of foreign sales, such as Halliburton, Intel, IBM, Johnson Controls, Lockheed Martin, National Odwell, Nike, Textron and United Technologies, all had a strong positive impact on overall portfolio performance for those equity strategies that held them in 2007. Global S&P 500 fans rely more on foreign sales to offset sluggish U.S. growth a4iP508Iarela.Yp�1 mreaaeP A° ° Vm pr Wlrnm.p 2001 2002 21013 2004 2005 2(Nw 1.t.— d— l..k., by Bator E-W 5G4% Teehwbgy 55.8% Comlmeeetopre. 48.0% Newth Cue M.W i.b 43A% White. 42A•/. I.d. tdah 41.0% fnrr Ji.cJelunnn 40.0% F 30.0% was up over 32 %. Our Allcap strategy exceeded the returns for its benchmark, the S &P 1500 Composite, by roughly one percentage point. The strongest relative performance was generated from Industrial and Financial sectors. Energy holdings within the Allcap strategy also returned 35.7% for the year. Investment Outlook Many of the problems that fueled the past year's worries have not sub. sided, especially weakness in the housing market, subprime mortgages, uncertainty over the direction of the economy, inflation and corporate earnings growth. It is hard to handicap whether the U.S. economy will enter a recession in 2008. We can say with more certainty, however, that corporate earnings growth is facing a number of escalating pressures. Corporate profit margins are being squeezed by a combination of lower revenue growth coupled with rising costs across a number of fronts, including raw materials, energy & utilities, wages & employee benefits and ship- ping costs. Uncertainty tends to fuel volatility, so it is likely equity investors will be forced to endure another volatile year. The good news is that worldwide growth remains solid, which should continue to help U.S. companies doing business overseas. The Federal Reserve has also sig- naled their resolve to support domestic economic growth, which bodes well for an eventual acceleration in economic activity sometime later this year. Dana Large Cap Portfolio Characteristics I- NEI )n. LC S&P 500 U..w sap too 0— Le S&P 5W EPS (b Mh vale F=e UwemN Yiie M.fke1 C.p (Avpoam'Mpdi..) 20°• J% 120 5'• 1.n% 12.4 °: 2% I4.% it" 5% . _.. _._.. � Large Core, our largest strategy in terms of assets under manage- ment, delivered returns slightly above the S &P 500 in 2007. IN.. LC S &P Sim . [Xp 11 1AP50f1 ,.,n.l ('nmpa,i,r t'N••.rierlr l r. .a of 1)ece tuber J1, i0n' Energy, Materials, Telecom & Utilities returned in excess of 20% for the year. Energy holdings were up almost 27 %, but this was actually a slight drag on relative performance as the S &P 500 Energy sector Dana Investment Advisors, Inc. is an independent federally registered investment adviser providing equity and fixed income investment management services to a broad range of clients. The returns pre- sented have been prepared and presented in accordance with the AIMR PPS Standards. AIMR has neither endorsed the presented performance, nor is AIMR affiliated with Dana Investment Advisors, Inc. in any way. All lee- paying accounts utilizing similar investment strategies to these discussed herein were included in the composite performance returns presented. Total firm assets for the period ending 12 -31- 06 were $2,814,940,000. The number of portfolios contained in the Dana Large Cap Equity and Small Cap Equity Strategies were 296 and 51 respectively. The percentage of firm assets in 2006 represented in the Dana Large Cap Equity Strategy was 21.7%; with an annual 2006 return dispersion of 012 %. The percentage of firm assets in 2006 represented in the Dana Small Cap Equity Strategy was 2.2 %; with an annual 20D6 return dispersion of 0.75 %. To receive a complete list and description of Dana Investment Advisor, Inc.'s composites and/or a presentation that adheres to the AIMR -PPS standards, contact Nick Berich at Tel. (262) 782.3631. All data is presented in U.S. Dollars. Portfolio characteristics reflect Dana equity strategy holdings as of market close on the date indicated. Returns presented are exclusive of Investment management and custodial tees, and net of transaction costs. Investment management fees would reduce the returns presented, for examplei an a one - million dollar portfolio with an advisory fee of .75% earning a 10% return, the total compounded advisory fee over a five year period would be $50,368. The resulting average annual return for the period would therefore be 9.17%. All returns were calculated on a time weighted total return basis. Performance does include the accrual of income and the reinvestment of dividends and interest received. Indexes shown were selected because they demon- strated similar characteristics to the Dana strategy to which they were compared. During various market cycles, the strategies discussed herein have demonstrated portfolio characteristics and returns that have been both more and less volatile than that of the comparable index. While data contained herein was gathered from sources deemed reliable, the accuracy of the data presented cannot be guaranteed. Past performance is not indicative of future returns. 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