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POLICE PENSION BOARD AGENDA NOVEMBER 13, 2014 - 10:00 A.M. CITY HALL CONFERENCE ROOM 15 LOOCKERMAN PLAZA DOVER, DELAWARE Public comments are welcomed on any item and will be permitted at appropriate times. When possible, please notify the City Clerk (736-7008 or e-mail at CityClerk@dover.de.us) should you wish to be recognized. AGENDA ADDITIONS/DELETIONS 1. Adoption of Minutes - Police Pension Board Meeting of August 14, 2014 2. Quarterly Performance Review (Quarter Ending September 13, 2014) (Milliman, Inc.) (Staff Recommends Acceptance of the Report) 3. Update on Pacific Investment Management Company (PIMCO) (Milliman, Inc.) 4. Review of Asset Allocation (This item was deferred during the Board meeting of August 14, 2014) 5. Adjournment by 10:55 a.m. TO ASSURE THAT THERE WILL BE A QUORUM, PLEASE RSVP BY CONTACTING THE CITY CLERK’S OFFICE BY EMAIL AT CITYCLERK@DOVER.DE.US OR BY CALLING 736-7008 AS SOON AS POSSIBLE. /js S:\AGENDAS-MINUTES-PACKETS-PRESENTATIONS-ATT&EXH\Misc-Agendas\PENSION BOARDS\2014\11-13-2014 POLICE PENSION BOARD AGENDA.wpd THE AGENDA ITEMS AS LISTED MAY NOT BE CONSIDERED IN SEQUENCE. THIS AGENDA IS SUBJECT TO CHANGE TO INCLUDE THE ADDITION OR THE DELETION OF ITEMS, INCLUDING EXECUTIVE SESSIONS.

POLICE PENSION BOARD The Police Pension Board meeting was held on August 14, 2014 at 10:03 a.m. with Mr. Lynn presiding in the absence of Chairman Mullaney. Members present were Mr. Stallings, Mr. Unterkofler, Chief Bernat, and Mr. Koenig. Mr. Anderson was absent. AGENDA ADDITIONS/DELETIONS Mr. Stallings moved for approval of the agenda as presented, seconded by Mr. Unterkofler. Adoption of Minutes - Police Pension Board Meeting of May 1, 2014 Mr. Stallings moved for adoption of the minutes of the Police Pension Board meeting of May 1, 2014, seconded by Mr. Unterkofler and unanimously carried. Organizational Issues - Election of Chair Mr. Koenig moved to nominate Mr. Mullaney to serve as Chair of the Police Pension Board, seconded by Mr. Stallings and unanimously carried. Quarterly Performance Review (Quarter Ending June 30, 2014)/Investment Manager Recommendations (Milliman, Inc.) Mr. Jeff Marzinsky, Principal and Employee Benefits Consultant, Milliman, Inc., reviewed the Board Meeting Notes dated August 14, 2014. He advised members that the plan assets as of June 30, 2014 were approximately $12.26M, which was an increase from approximately $11.59M on March 31, 2014 and included contributions and pension payments made during the quarter. Performance of the plan portfolio for the quarter was approximately 4%, which was generally in line with the performance of the plan’s benchmark index of 4.2%. Over the last year, the plan had a return of approximately 14.6%, which he stated was a good return in relation to the actuarial assumption of approximately 7% - 7.5% and would improve the funded status of the plan. Referring to Page 2 of the Board Meeting Notes, Mr. Marzinsky indicated that the Vanguard Prime Cap Fund had been closed to new investments; therefore, it was recommended to rebalance to different investments within the plan. In addition, the Vanguard Morgan Growth Fund had shown underperformance and changes were recommended. Mr. Marzinsky explained that this would be discussed later in the meeting. Mr. Marzinsky reviewed the Quarterly Investment Monitor - Summary Report for the Quarter Ending June 30, 2014. Referring to Page 3 - Market Indices - 2nd Quarter 2014, Mr. Marzinsky explained that the market had a very good quarter ending June 30, 2014, with equity markets performing very well and long-term bonds with very good returns as a result of declining interest rates. He stated that the Federal Reserve had indicated that interest rates would be kept low. Unemployment was down and in the 6% range, which was the lowest it had been in the last five (5) or six (6) years. The U.S. market was looking much better and returns for emerging markets, which were negative last year, were also starting to turn around. Caution was recommended going forward since the Dow Jones Industrial Average and Standard & Poor 500 were at high levels; however, returns for the year to date were “pretty good.” Referring to Page 9 - Asset Allocation, Mr. Marzinsky indicated that the plan had approximately $12.2M invested. He stated that approximately $560,000 was held in a Wells Fargo money market

POLICE PENSION BOARD MEETING OF AUGUST 14, 2014 PAGE 2 account to make monthly benefit payments to members. Mr. Marzinsky stated that the portfolio had a good balance of funds and that the investments are rebalanced to the target asset allocations as needed or when a contribution is received. Referring to Page 10 - Investment Policy Review - Active Management, Mr. Marzinsky stated that the Return Rank compared the plan’s investment managers to similar investment managers. For example, he explained that the Ivy High Income I rank of 4 indicated that this fund ranked in the top 4% of funds in its category. He indicated that funds in the top 50% were doing well and those below 50% were highlighted. Mr. Marzinsky advised members that the Excess Return reflected the performance of the fund compared to the Standard & Poor and Dow Jones Industrial Average market indexes, noting that each asset category had a different index benchmark. Mr. Marzinsky pointed out that the Vanguard Morgan Growth Admiral Fund was highlighted and had negative excess returns, which reflected that this fund underperformed its index by 2.84% over three (3) years and also underperformed over five (5) years. He explained that the Relative Standard Deviation indicates the volatility or risk of the fund compared to the risk of its index, and that a number above 1.0 indicates that a fund is more risky and moves up and down more than its index. Mr. Marzinsky stated that the Vanguard Morgan Growth Admiral Fund was taking on more risk than its market index but its performance was not exceeding the index. Mr. Marzinsky explained that lower numbers in Alpha and Sharpe rank are best, with the 99th percentile being the worst; therefore, the Vanguard Morgan Growth Fund ranked in the bottom third over three (3) years and at 65% or below over three (3) years for Sharpe, which indicated that the manager was not performing well compared to other funds in this category. He stated that other funds were generally performing well compared to the indexes and ranks within their category. There was slight underperformance in the Target Small Capitalization Value T Fund; however, it was taking on a little less risk and still ranked well compared to other funds in its category. Mr. Marzinsky recommended that the Vanguard Morgan Growth Admiral Fund be removed from the plan portfolio and replaced with two (2) other funds, the Vanguard Growth Index and the Vanguard Mid Cap Index, since the Vanguard Morgan Growth Admiral Fund had been investing in both large and small-to-mid-size company stocks. He indicated that if the fund was not exceeding the market index, it would be better to invest in index funds. Responding to Chief Bernat regarding the percentage of the plan portfolio that the Vanguard Morgan Growth Admiral Fund investments represented, Mr. Marzinsky stated that this was approximately 5% of the plan, which was approximately $600,000, 75% of which would be invested in the Vanguard Growth Index Fund and 25% in the Vanguard Mid Cap Index Fund, which would effectively replicate the current investment allocation. Mrs. Mitchell stated her concurrence with this recommendation. Chief Bernat moved in favor of Milliman, Inc.’s recommendation to remove the Vanguard Morgan Growth Admiral Fund from the plan portfolio and invest 75% of the funds in the Vanguard Growth Index Fund and 25% in the Vanguard Mid Cap Index Fund, seconded by Mr. Stallings and unanimously carried.

POLICE PENSION BOARD MEETING OF AUGUST 14, 2014 PAGE 3 Annual Review of Investment Policy Mr. Jeff Marzinsky, Milliman, Inc., advised members that he had redrafted the investment policy prepared by the prior investment advisor and had attempted to simplify the policy. He advised members that an investment policy statement serves as an instruction manual for the board to address their duties. It defines how investment managers are selected and monitored and how it is determined that money will be invested among those managers. Mrs. Mitchell reminded members that Mr. Marzinsky had provided a draft Investment Policy Statement during their meeting held on May 14, 2014. She stated that she compared the plan’s existing policy, the draft policy provided in May 2014, and the revised draft dated August 2014, and felt that the revised draft was a much better and clearer policy. Mr. Marzinsky reviewed the Investment Policy Statement for the City of Dover Police Pension Plan, August 2014. He noted that it assigned responsibilities of the Board, Milliman, Inc. as the advisor, and Wells Fargo as the trustee and set forth a structure for managing the assets. In reviewing Page 3 - II. Statement of Objectives, he advised members that, during their meeting held earlier in the day, the Civilian Pension Board had approved a change in the wording of Objective #9 to read, “Attain a funded status such that the employer has the option to discontinue contributions to the plan if deemed appropriate and fully funded.” Mr. Lynn explained that this change was made by the Civilian Pension Board to clarify the language since members felt uncomfortable with the phrase “terminate the plan if deemed appropriate.” He inquired if members wished to make a similar change. Mr. Koenig moved to amend the language as suggested, seconded by Mr. Lynn. Mr. Lynn explained that, when looking at Objective #9 as written, he was not necessarily sure that it reflected the intent to protect the pension fund. He felt that members would not wish to vest the employer with the ability to terminate the plan; therefore, it would be more prudent to state that funding the plan could be discontinued if it were fully funded. Mr. Unterkofler inquired who would determine if funding would be discontinued. Responding, Mr. Lynn and Mrs. Mitchell stated their opinions that the Police Pension Board would make this decision. The motion to amend the language of Objective # 9 to read “Attain a funded status such that the employer has the option to discontinue contributions to the plan if deemed appropriate and fully funded” was unanimously carried. Mr. Marzinsky explained that the body of the Investment Policy Statement contained the operational goals and objectives for the Board and the actual plan asset allocation was included as Appendix A to the body of the Investment Policy Statement. In this way, the Board could approve the body of the investment policy and make changes to Appendix A - Strategic Asset Allocation Policy as needed.

POLICE PENSION BOARD MEETING OF AUGUST 14, 2014 PAGE 4 Chief Bernat moved to approve the Investment Policy Statement, as amended (Attachment #1), seconded by Mr. Stallings and unanimously carried. Mr. Unterkofler moved to authorize Mr. Mullaney to sign the Investment Policy on the Board’s behalf, seconded by Mr. Stallings and unanimously carried. Mr. Marzinsky reviewed the City of Dover, Delaware Police Pension Plan Asset Allocation Study dated July 2014 that was included with the Quarterly Performance Monitor - Summary Report for the Quarter Ending June 30, 2014. Referring to Page 2 - Optimization Input Review, Mr. Marzinsky explained that Milliman, Inc. had developed projections for market returns over the next ten years, as well as the level of risk. In developing a portfolio, return expectations were weighed against the risk. For example, the U.S. Large Value Fund had an expected return of approximately 8% and an Annual Standard Deviation of approximately 17; therefore, the returns for this fund could increase by 17 percentage points to 25% or decline to -9%. In reference to Page 3 - Input Correlation, Mr. Marzinsky explained that this table reflected how well assets move together. If a portfolio were all equities, they would all go up and down at the same time; therefore, it was desired to mix asset categories to balance movements. Referring to the Page 4 - Individual and Group Constraints, he indicated that Milliman, Inc. set constraints to allow for a minimum and maximum in each asset category in order to prevent over- investment in the same types of assets. Mr. Marzinsky stated that page 5 - Portfolio Options, reflected the Current Portfolio Allocation of approximately 60% stocks and 40% fixed income investments in the fifth column, with an expected return of approximately 6.6% per year on average. He stated that during the previous year, the plan had a return of approximately 14% and the sample portfolios provided options for the Board to consider. If members desired to target a slightly higher return, as in Sample Portfolio #1, equity investments could be increased to approximately 67% and fixed income investments decreased to approximately 33%, although this would slightly increase volatility. Sample Portfolios #2 and #3 reflected the potential for greater returns but also greater risk. He stated that the current portfolio was a “more conservative, middle-of-the-road” portfolio. He advised members that actuarial expectations were for an approximate return of 7.5% per year and meeting this expectation would be a good thing for the funded status of the plan and would also affect the future contributions. Mrs. Mitchell explained that during their meeting of August 14, 2014, the Civilian Pension Board had opted to select Sample Portfolio #1 in an effort to move closer to the actuarial assumption and to help the City with contributions. She did not feel that this would be taking an aggressive approach, such as that in Sample Portfolio #3. She also advised members that this portfolio allocation would be considered at the next annual investment policy review but could also be reviewed on a quarterly basis. Mr. Lynn informed members that during the Civilian Pension Board meeting of August 14, 2014, Mr. Marzinsky had advised members that there would be no fees involved if a more aggressive approach were adopted and it was later decided to return to the original investment.

POLICE PENSION BOARD MEETING OF AUGUST 14, 2014 PAGE 5 Mr. Marzinsky confirmed that the portfolio would be rebalanced each quarter to the selected targets; therefore, no additional trading would be required. Mr. Unterkofler expressed his desire to defer changes to the asset allocation until Chairman Mullaney could be present. Mr. Unterkofler moved to defer consideration of changes to the asset allocation until the next meeting, seconded by Mr. Stallings and unanimously carried. (City Clerk’s Office Note: The City of Dover Police Pension Plan Strategic Asset Allocation Policy is Appendix A to the Investment Policy Statement.) Future Meeting Dates Mr. Unterkofler moved for approval of the proposed meeting dates of November 13, 2014; February 12, 2015; May 14, 2015, and August 13, 2015, seconded by Mr. Stallings and unanimously carried. By unanimous consent, the meeting adjourned at 10:53 a.m. Sean M. Lynn Acting Chairman SML/JS/dd S:\AGENDAS-MINUTES-PACKETS-PRESENTATIONS-ATT&EXH\Misc-Minutes\PENSION\2014\08-14-2014 Police Pension.wpd Attachment Attachment #1 - Investment Policy Statement - City of Dover Police Plan - August 2014

ATTACHMENT #1 Police Pension Board Meeting of 08/14/2014

250 Washington Ave Ext Albany, NY 12203 USA Tel +1 518 514 7157 Fax +1 518 514 7200 MEMO milliman.com To: City of Dover, Delaware Police Pension Plan – Board From: Jeff Marzinsky & Matt Albano/Milliman Re: Board Meeting Notes Enclosures: Milliman Quarterly Investment Monitor Report (QIM) 1. Police Pension Plan Investment Review through 9/30/14: a. As of quarter end, the plan had $11.70 million, down from $12.26 million at the prior quarter end. During the quarter, the plan had no contributions, withdrawals of approximately $389 thousand, and fees of $1.43 thousand. b. Total performance of the plan portfolio was -1.67% net (-1.60% gross) for the quarter, in line with the Plan’s benchmark index performance of -1.43%. City of Dover Police Pension Plan Quarterly Return Summary POLICE-NET POLICE GROSS- Month End BMV Contribution Withdrawls Fees Gain EMV RETURN RETURN 10/31/2013 $ 11,415,001.04 $ - $ 127,486.81 $ 459.44 $ 330,591.56 $ 11,617,646.35 2.93% 2.95% 11/30/2013 $ 11,617,646.35 $ - $ 127,486.81 $ 463.52 $ 48,882.24 $ 11,538,578.26 0.43% 0.45% 12/31/2013 $ 11,538,578.26 $ - $ 127,486.81 $ 536.27 $ 67,294.10 $ 11,477,849.28 0.59% 0.61% 1/31/2014 $ 11,477,849.28 $ 206,626.39 $ 129,993.49 $ 458.75 $ (126,461.59) $ 11,427,561.84 -1.11% -1.08% 2/28/2014 $ 11,427,561.84 $ - $ 129,993.49 $ 458.20 $ 357,379.64 $ 11,654,489.79 3.16% 3.18% 3/31/2014 $ 11,654,489.79 $ - $ 129,993.49 $ 227.47 $ 70,399.16 $ 11,594,667.99 0.61% 0.64% 4/30/2014 $ 11,594,667.99 $ - $ 130,337.56 $ 344.70 $ 68,278.78 $ 11,532,264.51 0.60% 0.62% 5/31/2014 $ 11,532,264.51 $ 46,951.58 $ 130,455.38 $ 461.89 $ 221,591.18 $ 11,669,890.00 1.94% 1.97% 6/30/2014 $ 11,669,890.00 $ 556,834.80 $ 129,993.49 $ 465.34 $ 165,132.98 $ 12,261,398.95 1.37% 1.40% 7/31/2014 $ 12,261,398.95 $ - $ 129,993.49 $ 480.44 $ (139,264.73) $ 11,991,660.29 -1.15% -1.12% 8/31/2014 $ 11,991,660.29 $ - $ 129,454.36 $ 473.46 $ 303,442.03 $ 12,165,174.50 2.56% 2.58% 9/30/2014 $ 12,165,174.50 $ - $ 129,454.36 $ 477.37 $ (366,419.08) $ 11,668,823.69 -3.01% -2.99% $ - $ 388,902.21 $ 1,431.27 $ (202,241.78) Quarterly Return -1.67% -1.60% $ 810,412.77 $ 1,552,129.54 $ 5,306.85 $ 1,000,846.27 One Year Return 9.09% 9.41% c. As of quarter end, the Plan’s asset allocation was in line with the allocation targets, as the plan was rebalanced on its quarterly schedule prior to quarter end. Fund Target Allocation with Category Description Category Investment Name Additional Asset Classes Asset Allocation Range 11/2013 Money Market CA Wells Fargo Advtg Treas Plus MMkt 4.50% 5-15%; target 10% Cash + STB Short Term Bonds STB Vanguard Short Term Bond 5.50% 5-15%; target 10% Cash + STB Inflation Protected Bonds TIPS Vanguard Inflation Prot Sec 5.00% 5-10%; target of 5% TIPS Intermediate Term Bonds INTB Vanguard Intermediate Bond 8.00% 3-13%; target 8% INTB Long Term Bonds LTB PIMCO Long Duration 4.50% 4-14%; target 9% LTB Long Term Bonds LTB Vanguard Long Duration 4.50% 4-14%; target 9% LTB High Yield Bond HYB Ivy High Income I 8.00% 3-13%; target 8% HYB Large Cap Value LCV Vanguard Equity Income 10.00% 5-15%; target 10% LCV Large Cap Growth LCG Vanguard Morgan Growth 0.00% REMOVED Large Cap Growth LCG Vanguard Primecap 5.30% CLOSED - no longer accepting contributions Large Cap Growth LCG Vanguard Growth Index 4.70% 5-15%; target 10% LCG Mid Cap MCB Vanguard Mid Cap Index 2.50% 0-10%; target 5% MC Mid Cap MCV Vanguard Mid Cap Value Index 2.50% 0-10%; target 5% MC Small Cap SCV Target Small Cap Value 8.00% 3-13%; target 8% SC Real Estate Investment REIT Vanguard REIT Index 7.00% 2-12%; target 7% REIT Foreign Equity GLB American Funds New Perspective 5.00% 5-15%; target 10% FOR Foreign Equity FLG Oppenheimber International Growth Y 5.00% 5-15%; target 10% FOR Foreign Equity GLB Harding Loevner Global Equity 0.00% REMOVED Emerging Markets EMG Vanguard Emerging Mkts 10.00% 5-15%; target 10% Emg Mkts Offices in Principal Cities Worldwide DOCUMENT PAGE 1

Meeting Notes Page 2 d. The majority of the plan investments have performance and rankings in line with their peer groups and benchmarks, as well as risk analytics that rank well to their peer groups. i. The plan includes the PIMCO Long Duration as a bond manager.  During the year PIMCO has had a variety of management changes within the organization with the resignation of their CEO during March, and the recent departure of Bill Gross, manager of the Total Return fund. With the changes in management of the organization, we recommend placing a watch on all PIMCO funds to review stability of management within the organization and their investment management teams. 2. Annual Investment Policy and Asset Allocation Review (re-addressed from the August Meeting) a. A draft Investment Policy Statement had been provided at the May meeting. It will be updated based on a Board decision regarding the overall portfolio asset allocation. b. In addition, it was discussed that the Board would review the overall portfolio allocation and determine if changes should be made. Milliman has prepared various allocation scenarios for consideration. i. An asset allocation study was conducted and summarized into the following optional investment allocation scenarios for consideration. ii. The current portfolio is indicated on the following exhibit, as “Current Portfolio Allocation”, along with three scenarios that could potentially increase the level of return (expected returns) and consequently the level of risk (standard deviation of returns). iii. Noting that the plan has an approximate duration of liabilities in the 13 year range; a slight adjustment to the equity and long duration bond categories will be made in each of the Sample Portfolios in the asset allocation study to compensate. Offices in Principal Cities Worldwide DOCUMENT PAGE 2

Meeting Notes Page 3 POLICE CURRENT Sample 1 Sample 2 Sample 3 Approx Current Approx Approx Approx Approx Asset Category Duration E(r ) Target Target Target Target Duration Duration Duration Duration Years Cash 0.50 2.5 4.5% 0.023 3% 0.02 3% 0.02 3% 0.02 Short Term 2.70 2.25 5.5% 0.149 5% 0.14 3% 0.08 2% 0.05 Inflation‐Protected Bond 7.80 2.1 5.0% 0.390 5% 0.39 3% 0.23 2% 0.16 Intermediate Term Bond 6.50 2.35 8.0% 0.520 6% 0.39 4% 0.26 2% 0.13 Long‐Term Bond 14.20 2.9 9.0% 1.278 7% 0.99 6% 0.85 4% 0.57 High Yield Bond 4.00 6.5 8.0% 0.320 7% 0.28 7% 0.28 7% 0.28 Large Value 8.05 10.0% ‐ 11% ‐ 12% ‐ 9% ‐ Large Growth 8.9 10.0% ‐ 14% ‐ 15% ‐ 16% ‐ Mid Cap Equity 8.15 5.0% ‐ 6% ‐ 7% ‐ 9% ‐ Small Cap Equity 8.4 8.0% ‐ 7% ‐ 8% ‐ 11% ‐ Foreign Equity 8.85 10.0% ‐ 12% ‐ 13% ‐ 15% ‐ Diversified Emerging Mkts 11 10.0% ‐ 9% ‐ 10% ‐ 11% ‐ Real Estate 8 7.0% ‐ 8% ‐ 9% ‐ 9% ‐ 100.0% 100% 100% 100% Equity Allocation 60% 67% 74% 80% Fixed Income Allocation 40% 33% 26% 20% Expected Return (%) 6.63 6.99 7.44 7.84 Approximate Standard Deviation 11.99 13.15 14.4 15.78 Approximate Duration of Portfolio 2.68 2.20 1.72 1.20 The analysis in this report was prepared utilizing data from third parties and other sources including but not limited to internal computer software and databases, including among others mpiStylus Pro©,, software designed by Markov Processes International. Reasonable care has been taken to assure the accuracy of the data contained herein, and comments are objectively stated and are based on facts gathered in good faith. These reports do not constitute investment advice with respect to the sale or disposition of individual securities. Milliman disclaims responsibility, financial or otherwise, for the accuracy or completeness of this report. This Milliman work product was prepared solely for the internal business use of our clients. Milliman's work may not be provided to third parties without Milliman's prior written consent. Milliman does not intend to benefit any third party recipient of its work product, even if Milliman consents to the release of its work product to such third party. Past performance is no guarantee of future results. Unless explicitly stated in your Service Agreement, there should be no reliance on Milliman services to provide analysis or reporting on a daily basis, the changes to manager rankings, ratings or opinions thereon. Unless explicitly stated in your Service Agreement, Milliman services are not intended to monitor investment manager compliance with individual security selection criteria, limits on security selection, and/or prohibitions to the holding of certain securities or security types. Milliman provides a copy of its SEC Form ADV Part II to clients without charge upon request. Offices in Principal Cities Worldwide DOCUMENT PAGE 3

Quarterly Investment Monitor Summary Report for the Quarter Ending September 30, 2014 Prepared for City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 4

Quarterly Investment Monitor Contents Section A: Market Commentary Section B: Performance Summary Section C: Core Fund Review Section D: Glossary City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 5 2

Quarterly Investment Monitor Market Indices - 3rd Quarter 2014 3 1 3 5 Index Months Year Years Years BofAML US Treasury Bill 3 Mon 0.01 0.05 0.07 0.10 Barclays US Govt 1-3 Yr TR USD 0.03 0.52 0.51 1.07 Barclays US Govt/Credit Interm TR USD -0.03 2.20 2.01 3.42 Barclays US Government Long TR USD 2.63 11.60 2.08 6.99 Barclays US Long Credit TR USD 0.17 13.58 6.71 8.67 Barclays US Corporate High Yield TR USD -1.87 7.20 11.09 10.57 DJ Industrial Average TR USD 1.87 15.29 19.02 14.85 S&P 500 TR 1.13 19.73 22.99 15.70 NASDAQ 100 TR USD 5.53 27.52 25.36 20.01 NASDAQ Composite TR USD 2.24 20.61 24.57 17.51 Russell 1000 Value TR USD -0.19 18.89 23.93 15.26 Russell 1000 TR USD 0.65 19.01 23.23 15.90 Russell 1000 Growth TR USD 1.49 19.15 22.45 16.50 Russell 2000 Value TR USD -8.58 4.12 20.61 13.02 Russell 2000 TR USD -7.36 3.93 21.26 14.29 Russell 2000 Growth TR USD -6.13 3.79 21.91 15.51 FTSE NAREIT All REITs TR -2.63 13.44 17.02 15.75 MSCI EAFE NR USD -5.88 4.25 13.65 6.56 MSCI EAFE Small Cap NR USD -7.82 3.00 14.49 8.91 MSCI EM NR USD -3.50 4.30 7.19 4.42 City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 6 3

Quarterly Investment Monitor Broad Market Commentary - 3rd Quarter 2014 Broad Markets - Quarter Broad Markets - Five Years Jul-14 - Sep-14 Sep-09 - Sep-14 3 240 2 220 1 200 0 Total Return, % Growth of $100 180 -1 160 -2 140 -3 120 -4 -5 100 -6 80 Jul-14 - Sep-14 Sep-09 Jun-10 Dec-10 Jun-11 Dec-11 Jun-12 Dec-12 Jun-13 Dec-13 Sep-14 Total Total Barclays US Govt/Credit Interm TR USD S&P 500 TR Barclays US Govt/Credit Interm TR USD S&P 500 TR NASDAQ Composite TR USD MSCI EAFE NR USD NASDAQ Composite TR USD MSCI EAFE NR USD Market Commentary The U.S. stock market rose modestly on improving economic data, strong mergers-and-acquisitions activity and solid growth in corporate earnings. Developed international equity markets fell due to weak economic growth and significant deflationary pressures in Europe and Japan. Emerging markets declined on worries about slowing economic growth in China, the reduction of Federal Reserve stimulus, and the ongoing political crisis in Ukraine. The Fed continued to reduce its securities purchase from its $85 billion level in late 2013 to a target of zero by the end of October. Mutual fund investors increased their holdings in bonds and decreased their holdings in stocks. For the quarter, bond funds had net inflows of $17.9 billion, while stock funds had net outflows of $8.0 billion. Total money market mutual fund assets decreased by $34.4 billion to $2.591 trillion. The unemployment rate fell from 6.1% to 5.9%, as total employment increased by 671,000 jobs. The price of oil decreased from $105 per barrel to $91 during the quarter, a decline of 13.3%. City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 7 4

Quarterly Investment Monitor US Fixed Income Market Commentary - 3rd Quarter 2014 US Fixed Income - Quarter US Fixed Income - Five Years Jul-14 - Sep-14 Sep-09 - Sep-14 3 170 160 2 150 Total Return, % Growth of $100 140 1 130 0 120 110 -1 100 90 -2 Sep-09 Jun-10 Dec-10 Jun-11 Dec-11 Jun-12 Dec-12 Jun-13 Dec-13 Sep-14 Jul-14 - Sep-14 Total Total BofAML US Treasury Bill 3 Mon Barclays US Govt 1-3 Yr TR USD BofAML US Treasury Bill 3 Mon Barclays US Govt 1-3 Yr TR USD Barclays US Govt/Credit Interm TR USD Barclays US Government Long TR USD Barclays US Govt/Credit Interm TR USD Barclays US Government Long TR USD Barclays US Long Credit TR USD Barclays US Corporate High Yield TR USD Barclays US Long Credit TR USD Barclays US Corporate High Yield TR USD US Bond Market The broad fixed income market rose 0.16% in the 3rd quarter, as the coupon return of 0.77% more than offset the negative impact from a 0.14% increase in interest rates. The short end of the yield curve remained unchanged as the Fed maintained its near-zero interest rate policy. The yield curve continued to flatten as the 30-year Treasury yield fell by 0.16%, while the 3-year rose by 0.17%. Long-term government bonds were the best performing sector this quarter, up 2.99%, as investors favored save-haven assets. Long-term corporate bonds were up 0.44%, as declining yields on the long end of the curve more than offset widening spreads. Global bonds were the worst performing sector this quarter, down 2.84%, as most foreign currencies fell sharply against the U.S. dollar. City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 8 5

Quarterly Investment Monitor US Equity Market Commentary - 3rd Quarter 2014 US Equity - Quarter US Equity - Five Years Jul-14 - Sep-14 Sep-09 - Sep-14 2 240 1 220 0 -1 200 Total Return, % Growth of $100 -2 180 -3 160 -4 -5 140 -6 120 -7 100 -8 -9 80 Jul-14 - Sep-14 Sep-09 Jun-10 Dec-10 Jun-11 Dec-11 Jun-12 Dec-12 Jun-13 Dec-13 Sep-14 Total Total Russell 1000 Value TR USD Russell 1000 TR USD Russell 1000 Value TR USD Russell 1000 TR USD Russell 1000 Growth TR USD Russell 2000 Value TR USD Russell 1000 Growth TR USD Russell 2000 Value TR USD Russell 2000 TR USD Russell 2000 Growth TR USD Russell 2000 TR USD Russell 2000 Growth TR USD US Stock Market The major domestic equity indicies were mixed for the quarter. The large-cap Russell 1000 Growth Index had the best return, up 1.49%. In terms of capitalization, large-cap stocks outperformed small-cap stocks. In comparing styles, growth outperformed value in the both large-cap and small-cap areas of the market. REITs fell 3.00%. as the likelihood of higher interest rates reduced demand for dividend-paying stocks. The worst performing REITs were industrial warehouses and the office sector. Energy was the worst performing sector, falling 8.52%, on lower oil and natural gas prices. Healthcare was the best performing sector, up 5.24%, on strong mergers-and-acquisitions activity and good earnings. City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 9 6

Quarterly Investment Monitor International Market Commentary - 3rd Quarter 2014 International - Quarter Jul-14 - Sep-14 0 International - Five Years -1 -2 Total Return, % Sep-09 - Sep-14 -3 170 -4 -5 160 -6 -7 150 -8 140 Growth of $100 130 MSCI EAFE NR USD MSCI EAFE Small Cap NR USD MSCI EM NR USD 120 Regional Performance - Quarter 110 Jul-14 - Sep-14 0 100 -1 -2 90 Total Return, % -3 80 -4 Sep-09 Jun-10 Dec-10 Jun-11 Dec-11 Jun-12 Dec-12 Jun-13 Dec-13 Sep-14 -5 -6 MSCI EAFE NR USD MSCI EAFE Small Cap NR USD -7 MSCI EM NR USD -8 MSCI Australia NR USD MSCI Europe Ex UK NR USD MSCI UK NR USD MSCI Pacific Ex Japan NR USD MSCI Japan NR USD MSCI EM Latin America NR USD International Markets The dollar was up strongly against the euro, yen and pound. For the quarter, the EAFE Index was down 5.88%, and Emerging Markets were down 3.49%. Local currency returns for the EAFE Index and Emerging Markets were 0.93% and 0.56%, respectively. Among the major international regions, Indian stocks had the highest return, up 2.34%, as investors anticipated more economic reforms and an improvement in GDP growth. Stocks in Russia had the lowest return, down 15.41% in the quarter and down 19.90% YTD, as the conflict with Ukraine continued and the West imposed greater economic sanctions. Large-Cap stocks, down 5.9%, outperformed small-cap stocks, down 7.8%. City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 10 7

Quarterly Investment Monitor Data as of 09/30/2014 Performance Summary City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 11 8

Quarterly Investment Monitor Data as of 09/30/2014 Asset Allocation Balances As of Percent As of Balances As of Percent As of Notes 09/30/2014 09/30/2014 06/30/2014 06/30/2014 Wells Fargo Advantage Treas Plus MMkt I $525,058 4.49% $559,525 4.56% PISXX Vanguard Short-Term Bond Index Signal $686,466 5.86% $672,865 5.49% VBSSX Vanguard Inflation-Protected Secs I $588,335 5.03% $611,666 4.99% VIPIX Vanguard Interm-Term Bond Index Signal $945,327 8.08% $981,645 8.01% VIBSX Vanguard Long-Term Bond Index I $533,978 4.56% $553,824 4.52% VBLLX PIMCO Long Duration Total Return Instl $531,505 4.54% $551,412 4.50% PLRIX Ivy High Income I $940,951 8.04% $981,333 8.00% IVHIX Vanguard Equity-Income Adm $1,162,453 9.93% $1,220,203 9.95% VEIRX Vanguard Growth Index Adm $551,062 4.71% $612,293 4.99% VIGAX Vanguard PRIMECAP Inv $614,323 5.25% $600,840 4.90% VPMCX Vanguard Mid-Cap Value Index Admiral $288,189 2.46% $613,970 5.01% VMVAX Vanguard Mid Cap Index Adm $292,235 2.50% $0 0.00% VIMAX Target Small Capitalization Value T $924,075 7.89% $985,347 8.04% TASVX Oppenheimer International Growth Y $577,428 4.93% $615,840 5.02% OIGYX American Funds New Perspective R6 $579,311 4.95% $611,841 4.99% RNPGX Vanguard Emerging Mkts Stock Idx I $1,137,352 9.72% $1,228,100 10.02% VEMIX Vanguard REIT Index I $826,599 7.06% $858,444 7.00% VGSNX Plan Total $11,704,645 $12,259,147 City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 12 9

Quarterly Investment Monitor Data as of 09/30/2014 Investment Policy Review - Active Management Return Return Excess Excess Relative Relative Alpha Sharpe Alpha Sharpe Fund Rank Rank Return Return StdDev StdDev Rank Rank Rank Rank Name 3Y 5Y 3Y 5Y 3Y 5Y 3Y 3Y 5Y 5Y Vanguard Inflation-Protected Secs I 27 16 -0.07 -0.03 1.03 1.02 34 31 37 30 PIMCO Long Duration Total Return Instl 27 11 0.68 0.13 1.00 0.96 45 55 67 67 Ivy High Income I 9 4 1.21 0.97 0.75 0.75 2 1 1 1 Vanguard Equity-Income Adm 56 7 -1.78 1.60 0.86 0.83 9 6 4 3 Vanguard PRIMECAP Inv 3 14 3.53 0.32 1.04 1.08 0 1 7 7 Target Small Capitalization Value T 58 38 -3.47 -1.00 0.91 0.88 38 30 24 18 Oppenheimer International Growth Y 25 7 1.29 2.05 1.00 1.02 20 21 7 8 American Funds New Perspective R6 30 28 1.98 1.56 0.96 0.98 25 16 30 21 Definitions Return Rank - Fund's category percentile return rank, a value less than 50 (1 is the best and 100 is the worst) implies the fund is beating more than 50% of its peer group. Excess Return - Fund's excess return over its benchmark, a value greater than 0 implies the fund's return is higher than its benchmark. Relative StdDev - Fund's standard deviation relative to its benchmark, a value less than 1 implies the fund's standard deviation is lower than its benchmark. Alpha Rank - Fund's category percentile Alpha rank, a value less than 50 (1 is the best and 100 is the worst) implies the fund is beating more than 50% of its peer group. Sharpe Rank - Fund's category percentile Sharpe Ratio rank, a value less than 50 (1 is the best and 100 is the worst) implies the fund is beating more than 50% of its peer group. City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 13 10

Quarterly Investment Monitor Data as of 09/30/2014 Investment Policy Review - Passive Management Excess Excess Tracking Tracking Fund Beta Beta Expense Return Return Error Error Name 3Y 5Y Ratio 3Y 5Y 3Y 5Y Vanguard Short-Term Bond Index Signal 0.27 0.64 2.12 0.60 1.84 0.76 0.10 Vanguard Interm-Term Bond Index Signal 1.88 1.17 0.94 1.61 0.84 1.79 0.10 Vanguard Long-Term Bond Index I -0.06 0.00 1.02 0.85 1.03 0.88 0.07 Vanguard Growth Index Adm 0.64 1.10 0.99 0.55 1.00 0.78 0.09 Vanguard Mid-Cap Value Index Admiral -0.20 -0.76 1.01 0.82 1.00 1.23 0.09 Vanguard Mid Cap Index Adm 0.01 -0.14 1.02 0.55 1.02 0.88 0.09 Vanguard Emerging Mkts Stock Idx I 0.55 -0.17 0.98 3.08 1.03 3.10 0.12 Vanguard REIT Index I 1.29 1.33 1.00 0.22 1.00 0.19 0.08 Definitions Excess Return - Fund's excess return over its benchmark, a value greater than 0 implies the fund's return is higher than its benchmark. Beta - Fund's Beta or sensitivity to movements compared to its benchmark, a value of 1 implies its moving in sync with its benchmark. Tracking Error - Fund's Tracking Error versus its benchmark, a value of 0 implies the Fund's ups and downs are the same size as its benchmark. City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 14 11

Quarterly Investment Monitor Data as of 09/30/2014 Investment Option Return Summary Asset Fund 3 1 3 5 10 Mstar Expense YTD Ticker Class Name Months Year Years Years Years Rating Ratio Money Market-Taxable Wells Fargo Advantage Treas Plus MMkt I 0.00 0.01 0.01 0.01 0.01 1.45 PISXX NA 0.20 BofA ML 91-day Tbill Auction Avg 0.01 0.03 0.05 0.07 0.10 1.59 N/A NA NA Short-term Bond Vanguard Short-Term Bond Index Signal (0.07) 0.91 1.04 1.19 2.09 3.27 VBSSX 3.00 0.10 Barclays US Govt/Credit 1-3 Yr TR USD 0.04 0.60 0.77 0.92 1.45 2.85 N/A NA NA Inflation-Protected Bond Vanguard Inflation-Protected Secs I (1.93) 3.87 1.53 1.27 4.45 4.52 VIPIX 4.00 0.07 Barclays US Treasury US TIPS TR USD (2.04) 3.67 1.59 1.34 4.48 4.63 N/A NA NA Intermediate-term Bond Vanguard Interm-Term Bond Index Signal 0.01 4.99 4.39 3.29 5.63 5.44 VIBSX 4.00 0.10 Barclays US Govt 5-10 Yr TR USD 0.15 4.04 2.49 1.41 4.47 5.08 N/A NA NA Long-term Bond Vanguard Long-Term Bond Index I 1.27 13.57 13.06 4.69 8.04 7.08 VBLLX 3.00 0.07 Long-term Bond PIMCO Long Duration Total Return Instl 1.22 13.29 13.05 5.43 8.17 NA PLRIX 4.00 0.50 BC Long Government/Credit 1.04 12.97 12.87 4.75 8.04 7.01 N/A NA NA High Yield Bond Ivy High Income I (1.27) 3.40 6.88 12.30 11.55 8.72 IVHIX 5.00 0.69 BC High Yield Corporate Bond (1.87) 3.49 7.20 11.09 10.57 8.33 N/A NA NA Large Value Vanguard Equity-Income Adm (0.53) 7.07 16.70 21.68 16.34 8.96 VEIRX 5.00 0.21 S&P 500 Value 0.25 7.23 17.77 23.46 14.73 7.56 N/A NA NA Large Growth Vanguard Growth Index Adm 1.05 8.11 19.31 22.94 16.62 9.08 VIGAX 4.00 0.09 CRSP US Large Cap Growth TR USD 1.06 8.18 19.38 22.30 15.52 8.91 N/A NA NA Large Growth Vanguard PRIMECAP Inv 2.66 12.81 24.72 26.15 16.95 10.56 VPMCX 5.00 0.45 S&P 500 Growth 1.92 9.36 21.55 22.62 16.64 8.57 N/A NA NA Mid-Cap Value Vanguard Mid-Cap Value Index Admiral (2.24) 6.56 17.81 24.68 16.97 NA VMVAX 4.00 0.09 CRSP US Mid Cap Value TR USD (2.26) 6.61 17.87 24.89 17.73 9.84 N/A NA NA Mid-Cap Blend Vanguard Mid Cap Index Adm (1.16) 6.68 15.88 23.31 17.03 10.28 VIMAX 5.00 0.09 CRSP US Mid Cap TR USD (1.15) 6.73 15.94 23.30 17.17 10.16 N/A NA NA Small Value Target Small Capitalization Value T (5.79) (1.27) 7.42 20.62 14.66 9.83 TASVX 4.00 0.68 S&P 600 Value (6.78) (2.62) 6.74 24.09 15.66 8.74 N/A NA NA Foreign Large Growth Oppenheimer International Growth Y (8.19) (6.00) (0.26) 14.72 9.62 9.36 OIGYX 4.00 0.90 MSCI EAFE Large Growth NR USD (5.00) (2.05) 3.11 13.43 7.56 6.83 N/A NA NA World Stock American Funds New Perspective R6 (1.80) 1.70 10.49 18.59 11.63 9.36 RNPGX 4.00 0.45 MSCI AC World Index ND USD (2.30) 3.73 11.32 16.61 10.07 7.28 N/A NA NA Diversified Emerging Mkts Vanguard Emerging Mkts Stock Idx I (2.43) 4.51 6.19 7.77 4.38 10.45 VEMIX 3.00 0.12 FTSE Emerging NR USD (2.34) 4.87 6.50 7.23 4.55 11.21 N/A NA NA Real Estate Vanguard REIT Index I (3.12) 13.99 13.21 16.57 15.94 8.64 VGSNX 4.00 0.08 MSCI US REIT NR USD (3.38) 13.04 11.90 15.28 14.62 NA N/A NA NA Total Plan POLICE GROSS-RETURN (1.60) 5.15 9.41 10.62 7.84 NA N/A NA NA Total Plan POLICE-NET RETURN (1.67) 4.92 9.09 10.31 7.53 NA N/A NA NA Police Plan Policy Index (1.43) 5.20 9.11 11.55 8.78 6.19 N/A NA NA City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 15 12

Quarterly Investment Monitor Data as of 09/30/2014 U.S. Fixed Income Style Map 36 Month moving average, Oct-09 - Sep-14 BC Government BC Credit Bond BC Municipal Bond BC High Yield Corporate Bond BC Mortgage Backed Securities Barcap US Fixed Income Vanguard Short-Term Bond Index Signal Vanguard Inflation-Protected Secs I Vanguard Interm-Term Bond Index Signal Vanguard Long-Term Bond Index I PIMCO Long Duration Total Return Instl Ivy High Income I City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 16 13

Quarterly Investment Monitor Data as of 09/30/2014 U.S. Equity Style Map 36 Month moving average, Oct-09 - Sep-14 LgValue LgGrowth Small - Large MidValue MidGrowth SmValue SmGrowth Value - Growth S&P/BARRA Style Indices Vanguard Equity-Income Adm Vanguard Growth Index Adm Vanguard PRIMECAP Inv Vanguard Mid-Cap Value Index Admiral Vanguard Mid Cap Index Adm Target Small Capitalization Value T Vanguard REIT Index I City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 17 14

Quarterly Investment Monitor Data as of 09/30/2014 International Equity Style Map 36 Month moving average, Oct-09 - Sep-14 Europe Large Asia Pacific Large Small - Large Europe Small Asia Pacific Small European Emerging Asia Pacific Emerging Europe - Asia SBI Equity Indices Oppenheimer International Growth Y American Funds New Perspective R6 Vanguard Emerging Mkts Stock Idx I City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 18 15

Quarterly Investment Monitor Data as of 09/30/2014 Core Fund Review City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 19 16

Quarterly Investment Monitor Data as of 09/30/2014 Vanguard Short-Term Bond Index Signal 3.40 Portfolio Information Investment Strategy Summary 12.60 % Cash Ticker VBSSX % US Stocks The investment seeks to track the performance of a market-weighted bond index with a Morningstar Category Short-term Bond % Bonds short-term dollar-weighted average maturity. The fund employs an indexing investment Avg Mkt Cap $MM NA % Non-US Stocks approach designed to track the performance of the Barclays U.S. 1-5 Year Cat Med Mkt Cap $MM 50339.33 % Pref Government/Credit Float Adjusted Index. This index includes all medium and larger issues of Net Assets $MM 37141.82 % Conv U.S. government, investment-grade corporate, and investment-grade international Turnover Ratio 50.00 dollar-denominated bonds that have maturities between 1 and 5 years and are publicly % Other % Assets in Top 10 Holdings 12.96 issued. All of the fund's investments will be selected through the sampling process, and at % Non-US Bonds Total Number of Holdings 2061.00 least 80% of the fund's assets will be invested in bonds held in the index. Manager Name Joshua C. Barrickman Manager Tenure 1.60 _________________________________________________________________________ 83.95 Fund Incept Date 03/01/1994 Prospectus Exp Ratio 0.10 Phone Number 800-662-7447 Performance vs. Peer Group Portfolio Region Portfolio Structure % United States NA % Cash 3.40 5 % Canada NA % US Stocks 0.00 % Latin America NA % Bonds 83.95 % United Kingdom NA % Non-US Stocks 0.00 4 % Eurozone NA % Pref 0.05 Portfolio Ratings Total Annualized Return, % % Europe - ex Euro NA % Conv 0.00 Mstar Rating % Europe - Emerging NA % Other 0.00 3 Year Mstar Rating % Africa NA % Non-US Bonds 12.60 % Rank Cat 3 Yr 70 3 % Middle East NA 5 Year Mstar Rating % Japan NA % Rank Cat 5 Yr 59 % Australasia NA 10 Year Mstar Rating % Asia - Developed NA 2 % Rank Cat 10 Yr 33 % Asia - Emerging NA 1 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group % Basic Materials NA Avg Eff Duration 2.69 2 250 % Communication Services NA Effective Maturity 2.80 0 % Consumer Cyclical NA Avg Credit Quality AA 225 % Consumer Defensive NA AAA 72.57 % Healthcare NA AA 4.81 200 -1 % Industrials NA A 12.54 3 Months YTD 1 Year 3 Years 5 Years % Real Estate NA BBB 10.08 % Technology NA BB 0.00 175 % Energy NA B 0.00 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services NA Below B 0.00 150 Median to 75th Percentile 75th to 95th Percentile % Utilities NA NR/NA 0.00 Ratio Vanguard Short-Term Bond Index Signal Barclays US Govt/Credit 1-3 Yr TR USD 1 125 Turnover 3 Year to 1 3 5 Top Ten Holdings 100 Performance Months Date Year Years Years US Treasury Note 1.625% 1.82% Vanguard Short-Term Bond Index Signal -0.07 0.91 1.04 1.19 2.09 US Treasury Note 1.25% 1.47% 75 Barclays US Govt/Credit 1-3 Yr TR USD 0.04 0.60 0.77 0.92 1.45 US Treasury Note 0.625% 1.46% Universe(5%) 0.14 2.52 3.49 4.31 4.91 US Treasury Note 2.125% 1.37% 50 Universe(25%) -0.01 1.39 1.86 2.61 3.06 US Treasury Note 1.5% 1.22% Universe(Median) -0.10 0.93 1.38 1.97 2.46 US Treasury Note 0.625% 1.20% 25 Universe(75%) -0.26 0.64 0.91 1.23 1.88 US Treasury Note 0.625% 1.15% Universe(95%) -0.56 0.22 0.37 0.42 0.92 US Treasury Note 0.625% 1.10% 0 0 US Treasury Note 1.5% 1.09% Prospectus Exp Ratio Turnover Ratio US Treasury Note 0.375% 1.07% City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 20 17

Quarterly Investment Monitor Data as of 09/30/2014 Vanguard Short-Term Bond Index Signal Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 20 0 15 25 Total Return Rank, % 10 50 Total Return, % 5 75 0 -5 100 Oct-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Sep-14 -10 Up/Down Market Capture Ratio -15 Oct-11 - Sep-14 600 -20 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 500 Up Mkt Capture Ratio, % Vanguard Short-Term Bond Index Signal Barclays US Govt/Credit 1-3 Yr TR USD 400 Annual Return % 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 300 Vanguard Short-Term Bond Index Signal 1.70 1.31 4.09 7.28 5.51 4.38 4.03 3.08 2.05 0.17 Barclays US Govt/Credit 1-3 Yr TR USD 1.30 1.77 4.25 6.83 4.97 3.82 2.80 1.59 1.26 0.64 200 100 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 3 3 3 3 0 -100 0 100 200 300 400 500 600 700 Down Mkt Capture Ratio, % 2 Excess Annualized StdDev, % Morningstar Short Term Bond Universe Vanguard Short-Term Bond Index Signal Total Annualized StdDev, % 2 2 2 Barclays US Govt/Credit 1-3 Yr TR USD Sharpe Ratio 1 Alpha, % 0 Return vs. Risk 1 1 1 Oct-11 - Sep-14 7 -1 6 Total Annualized Return, % -2 0 0 0 5 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 4 Vanguard Short-Term Bond Index Signal Barclays US Govt/Credit 1-3 Yr TR USD 3 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error 2 Vanguard Short-Term Bond Index Signal -0.67 2.12 90.30 1.09 1.02 0.60 1 Barclays US Govt/Credit 1-3 Yr TR USD 0.00 1.00 100.00 1.85 0.45 0.00 Universe(5%) 2.04 3.88 83.62 2.76 2.38 2.04 0 0 1 2 3 4 5 6 Universe(25%) 0.60 2.40 75.59 1.95 1.62 1.28 Universe(Median) 0.18 1.91 66.82 1.61 1.08 0.77 Total Annualized StdDev, % Universe(75%) -0.26 1.45 53.55 1.25 0.87 0.54 Morningstar Short Term Bond Universe Vanguard Short-Term Bond Index Signal Universe(95%) -1.21 1.06 29.88 0.53 0.59 0.30 Cash Barclays US Govt/Credit 1-3 Yr TR USD City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 21 18

Quarterly Investment Monitor Data as of 09/30/2014 Vanguard Inflation-Protected Secs I 1.16 Portfolio Information Investment Strategy Summary % Cash Ticker VIPIX % US Stocks The investment seeks to provide inflation protection and income consistent with investment Morningstar Category Inflation-Protected Bond % Bonds in inflation-indexed securities. The fund invests at least 80% of its assets in inflation-indexed Avg Mkt Cap $MM NA % Non-US Stocks bonds issued by the U.S. government, its agencies and instrumentalities, and corporations. It Cat Med Mkt Cap $MM 8437.42 % Pref may invest in bonds of any maturity; however, its dollar-weighted average maturity is Net Assets $MM 25490.60 % Conv expected to be in the range of 7 to 20 years. At a minimum, all bonds purchased by the fund Turnover Ratio 44.00 will be rated investment-grade or, if unrated, will be considered by the advisor to be % Other % Assets in Top 10 Holdings 47.19 investment-grade. % Non-US Bonds Total Number of Holdings 38.00 Manager Name Gemma Wright-Casparius _________________________________________________________________________ Manager Tenure 3.12 98.84 Fund Incept Date 06/29/2000 Prospectus Exp Ratio 0.07 Phone Number 800-662-7447 Performance vs. Peer Group Portfolio Region Portfolio Structure % United States NA % Cash 1.16 5 % Canada NA % US Stocks 0.00 % Latin America NA % Bonds 98.84 % United Kingdom NA % Non-US Stocks 0.00 4 % Eurozone NA % Pref 0.00 Portfolio Ratings Total Annualized Return, % % Europe - ex Euro NA % Conv 0.00 Mstar Rating 3 % Europe - Emerging NA % Other 0.00 3 Year Mstar Rating % Africa NA % Non-US Bonds 0.00 % Rank Cat 3 Yr 29 % Middle East NA 5 Year Mstar Rating 2 % Japan NA % Rank Cat 5 Yr 10 % Australasia NA 10 Year Mstar Rating % Asia - Developed NA 1 % Rank Cat 10 Yr 18 % Asia - Emerging NA 0 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group -1 % Basic Materials NA Avg Eff Duration 7.92 1.0 400 % Communication Services NA Effective Maturity 8.60 % Consumer Cyclical NA Avg Credit Quality Government 0.9 -2 % Consumer Defensive NA AAA 100.00 350 % Healthcare NA AA 0.00 0.8 -3 % Industrials NA A 0.00 3 Months YTD 1 Year 3 Years 5 Years 300 % Real Estate NA BBB 0.00 % Technology NA BB 0.00 0.7 % Energy NA B 0.00 5th to 25th Percentile 25th to Median 250 Prospectus Exp Ratio % Financial Services NA Below B 0.00 0.6 Median to 75th Percentile 75th to 95th Percentile % Utilities NA NR/NA 0.00 Ratio Vanguard Inflation-Protected Secs I Barclays US Treasury US TIPS TR USD 0.5 200 Turnover 3 Year to 1 3 5 Top Ten Holdings 0.4 Performance 150 Months Date Year Years Years US Treasury TIP 5.75% Vanguard Inflation-Protected Secs I -1.93 3.87 1.53 1.27 4.45 US Treasury TIP 5.29% 0.3 Barclays US Treasury US TIPS TR USD -2.04 3.67 1.59 1.34 4.48 US Treasury TIP 4.82% 100 Universe(5%) -1.47 3.94 1.91 2.19 4.77 US TREASURY TIP 4.70% 0.2 Universe(25%) -1.98 3.52 1.43 1.30 4.27 US Treasury TIP 4.65% Universe(Median) -2.19 3.12 1.02 1.03 3.99 US Treasury TIP 4.61% 50 0.1 Universe(75%) -2.35 1.95 0.74 0.76 3.62 US Treasury TIP 0.125% 4.58% Universe(95%) -2.59 0.30 -0.35 0.13 2.41 US TREASURY TIP 4.49% 0.0 0 US Treasury TIP 4.24% Prospectus Exp Ratio Turnover Ratio US Treasury TIP 1.125% 4.05% City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 22 19

Quarterly Investment Monitor Data as of 09/30/2014 Vanguard Inflation-Protected Secs I Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 20 0 15 25 Total Return Rank, % 10 50 Total Return, % 5 75 0 100 Oct-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Sep-14 -5 Up/Down Market Capture Ratio -10 Oct-11 - Sep-14 200 -15 180 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 160 Up Mkt Capture Ratio, % Vanguard Inflation-Protected Secs I Barclays US Treasury US TIPS TR USD 140 120 Annual Return % 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 100 Vanguard Inflation-Protected Secs I 8.25 2.78 0.46 11.82 -2.81 11.03 6.33 13.39 6.87 -8.83 80 Barclays US Treasury US TIPS TR USD 8.46 2.84 0.41 11.64 -2.35 11.41 6.31 13.56 6.98 -8.61 60 40 20 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 2 6 5 0 0 20 40 60 80 100 120 140 160 180 200 Down Mkt Capture Ratio, % 0.5 5 4 Excess Annualized StdDev, % 1 Morningstar Inflation Proteced Bond Universe Vanguard Inflation-Protected Secs I Total Annualized StdDev, % 0.4 4 Barclays US Treasury US TIPS TR USD Sharpe Ratio 3 Alpha, % 0 0.3 3 2 Return vs. Risk 0.2 2 Oct-11 - Sep-14 -1 3 1 0.1 1 2 Total Annualized Return, % -2 0.0 0 0 1 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile Vanguard Inflation-Protected Secs I Barclays US Treasury US TIPS TR USD 0 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr -1 Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error Vanguard Inflation-Protected Secs I -0.10 1.03 99.24 0.25 5.44 0.50 -2 Barclays US Treasury US TIPS TR USD 0.00 1.00 100.00 0.27 5.27 0.00 Universe(5%) 1.06 1.12 99.76 0.56 5.99 4.18 -3 0 1 2 3 4 5 6 7 8 9 10 11 Universe(25%) 0.11 1.00 99.36 0.28 5.36 1.77 Universe(Median) -0.23 0.96 98.45 0.22 5.07 0.71 Total Annualized StdDev, % Universe(75%) -0.45 0.90 94.64 0.17 4.80 0.48 Morningstar Inflation Proteced Bond Universe Vanguard Inflation-Protected Secs I Universe(95%) -1.10 0.31 58.13 0.04 2.07 0.28 Cash Barclays US Treasury US TIPS TR USD City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 23 20

Quarterly Investment Monitor Data as of 09/30/2014 Vanguard Interm-Term Bond Index Signal Portfolio Information Investment Strategy Summary 13.63 % Cash Ticker VIBSX % US Stocks The investment seeks the performance of a market-weighted bond index with an Morningstar Category Intermediate-term Bond % Bonds intermediate-term dollar-weighted average maturity. The fund employs an indexing Avg Mkt Cap $MM NA % Non-US Stocks investment approach designed to track the performance of the Barclays U.S. 5-10 Year Cat Med Mkt Cap $MM NA % Pref Government/Credit Float Adjusted Index. This index includes all medium and larger issues of Net Assets $MM 15878.96 % Conv U.S. government, investment-grade corporate, and investment-grade international Turnover Ratio 70.00 dollar-denominated bonds that have maturities between 5 and 10 years and are publicly % Other % Assets in Top 10 Holdings 22.77 issued. All of the fund's investments will be selected through the sampling process, and at % Non-US Bonds Total Number of Holdings 1557.00 least 80% of the fund's assets will be invested in bonds held in the index. Manager Name Joshua C. Barrickman 85.55 Manager Tenure 6.44 _________________________________________________________________________ Fund Incept Date 03/01/1994 Prospectus Exp Ratio 0.10 Phone Number 800-662-7447 Performance vs. Peer Group Portfolio Region Portfolio Structure % United States NA % Cash 0.82 6 % Canada NA % US Stocks 0.00 % Latin America NA % Bonds 85.55 % United Kingdom NA % Non-US Stocks 0.00 5 % Eurozone NA % Pref 0.00 Portfolio Ratings Total Annualized Return, % % Europe - ex Euro NA % Conv 0.00 Mstar Rating % Europe - Emerging NA % Other 0.00 3 Year Mstar Rating % Africa NA % Non-US Bonds 13.63 % Rank Cat 3 Yr 52 4 % Middle East NA 5 Year Mstar Rating % Japan NA % Rank Cat 5 Yr 22 % Australasia NA 10 Year Mstar Rating % Asia - Developed NA 3 % Rank Cat 10 Yr 14 % Asia - Emerging NA 2 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group % Basic Materials NA Avg Eff Duration 6.51 0.7 350 % Communication Services NA Effective Maturity 7.30 1 % Consumer Cyclical NA Avg Credit Quality A % Consumer Defensive NA AAA 53.94 0.6 300 % Healthcare NA AA 5.07 % Industrials NA A 17.62 0 3 Months YTD 1 Year 3 Years 5 Years % Real Estate NA BBB 23.35 0.5 250 % Technology NA BB 0.00 % Energy NA B 0.00 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services NA Below B 0.02 Median to 75th Percentile 75th to 95th Percentile Ratio % Utilities NA NR/NA 0.00 0.4 200 Vanguard Interm-Term Bond Index Signal Barclays US Govt 5-10 Yr TR USD 0.3 Turnover 150 3 Year to 1 3 5 Top Ten Holdings Performance Months Date Year Years Years US Treasury Note 2.5% 3.74% Vanguard Interm-Term Bond Index Signal 0.01 4.99 4.39 3.29 5.63 US Treasury Note 2% 2.83% 0.2 100 Barclays US Govt 5-10 Yr TR USD 0.15 4.04 2.49 1.41 4.47 US Treasury Note 3.5% 2.76% Universe(5%) 0.40 4.92 4.41 2.62 4.42 US Treasury Note 3.625% 2.55% Universe(25%) 0.18 4.06 3.83 2.25 3.91 US Treasury Note 2.75% 2.11% Universe(Median) 0.13 4.02 3.77 2.20 3.84 0.1 50 US Treasury Note 1.75% 1.98% Universe(75%) 0.07 3.96 3.63 2.07 3.71 US Treasury Note 2.5% 1.86% Universe(95%) 0.03 3.84 3.50 1.95 3.59 US Treasury Note 2.75% 1.86% 0.0 0 US Treasury Note 3.125% 1.66% Prospectus Exp Ratio Turnover Ratio US Treasury Note 2% 1.42% City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 24 21

Quarterly Investment Monitor Data as of 09/30/2014 Vanguard Interm-Term Bond Index Signal Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 16 0 14 25 Total Return Rank, % 12 10 50 Total Return, % 8 6 75 4 2 100 Oct-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Sep-14 0 -2 Up/Down Market Capture Ratio -4 Oct-11 - Sep-14 120 -6 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 100 Up Mkt Capture Ratio, % Vanguard Interm-Term Bond Index Signal Barclays US Govt 5-10 Yr TR USD 80 Annual Return % 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 60 Vanguard Interm-Term Bond Index Signal 5.22 1.75 3.91 7.66 5.01 6.89 9.48 10.73 7.02 -3.45 Barclays US Govt 5-10 Yr TR USD 4.50 2.25 3.33 9.84 15.38 -3.55 8.62 12.98 3.72 -4.61 40 20 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 2 0.9 5 2 0 0 10 20 30 40 50 60 70 80 90 100 0.8 Down Mkt Capture Ratio, % 4 0.7 Excess Annualized StdDev, % Morningstar IntermTerm Bond Index Universe Vanguard Interm-Term Bond Index Signal Total Annualized StdDev, % 0.6 Barclays US Govt 5-10 Yr TR USD Sharpe Ratio 3 Alpha, % 0.5 1 1 0.4 2 Return vs. Risk 0.3 Oct-11 - Sep-14 0.2 4 1 0.1 Total Annualized Return, % 0 0.0 0 0 3 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile Vanguard Interm-Term Bond Index Signal Barclays US Govt 5-10 Yr TR USD 2 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error 1 Vanguard Interm-Term Bond Index Signal 1.93 0.94 85.37 0.78 4.15 1.61 Barclays US Govt 5-10 Yr TR USD 0.00 1.00 100.00 0.34 4.10 0.00 Universe(5%) 1.61 0.70 88.67 0.84 3.11 1.97 0 0 1 2 3 4 5 Universe(25%) 1.33 0.62 86.85 0.80 2.71 1.90 Universe(Median) 1.27 0.61 86.46 0.78 2.69 1.88 Total Annualized StdDev, % Universe(75%) 1.15 0.60 85.27 0.75 2.67 1.86 Morningstar IntermTerm Bond Index Universe Vanguard Interm-Term Bond Index Signal Universe(95%) 1.04 0.59 83.89 0.71 2.64 1.73 Cash Barclays US Govt 5-10 Yr TR USD City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 25 22

Quarterly Investment Monitor Data as of 09/30/2014 Vanguard Long-Term Bond Index I Portfolio Information Investment Strategy Summary 14.28 % Cash Ticker VBLLX % US Stocks The investment seeks to track the performance of a market-weighted bond index with a Morningstar Category Long-term Bond % Bonds long-term dollar-weighted average maturity. The fund employs an indexing investment Avg Mkt Cap $MM NA % Non-US Stocks approach designed to track the performance of the Barclays U.S. Long Government/Credit Cat Med Mkt Cap $MM NA % Pref Float Adjusted Index. This index includes all medium and larger issues of U.S. government, Net Assets $MM 7262.92 % Conv investment-grade corporate, and investment-grade international dollar-denominated bonds Turnover Ratio 50.00 that have maturities of greater than 10 years and are publicly issued. All of the fund's % Other % Assets in Top 10 Holdings 16.05 investments will be selected through the sampling process, and at least 80% of the fund's % Non-US Bonds Total Number of Holdings 1762.00 assets will be invested in bonds held in the index. Manager Name Joshua C. Barrickman 85.01 Manager Tenure 1.60 _________________________________________________________________________ Fund Incept Date 03/01/1994 Prospectus Exp Ratio 0.07 Phone Number 800-662-7447 Performance vs. Peer Group Portfolio Region Portfolio Structure % United States NA % Cash 0.68 14 % Canada NA % US Stocks 0.00 % Latin America NA % Bonds 85.01 % United Kingdom NA % Non-US Stocks 0.00 12 % Eurozone NA % Pref 0.03 Portfolio Ratings Total Annualized Return, % % Europe - ex Euro NA % Conv 0.00 Mstar Rating 10 % Europe - Emerging NA % Other 0.00 3 Year Mstar Rating % Africa NA % Non-US Bonds 14.28 % Rank Cat 3 Yr 30 % Middle East NA 5 Year Mstar Rating 8 % Japan NA % Rank Cat 5 Yr 39 % Australasia NA 10 Year Mstar Rating NA % Asia - Developed NA 6 % Rank Cat 10 Yr 1 % Asia - Emerging NA 4 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 2 % Basic Materials NA Avg Eff Duration 14.44 2 160 % Communication Services NA Effective Maturity 24.20 % Consumer Cyclical NA Avg Credit Quality A 0 % Consumer Defensive NA AAA 36.50 140 % Healthcare NA AA 7.03 % Industrials NA A 25.92 -2 120 3 Months YTD 1 Year 3 Years 5 Years % Real Estate NA BBB 30.55 % Technology NA BB 0.00 % Energy NA B 0.00 5th to 25th Percentile 25th to Median 100 Prospectus Exp Ratio % Financial Services NA Below B 0.00 Median to 75th Percentile 75th to 95th Percentile % Utilities NA NR/NA 0.00 Ratio Vanguard Long-Term Bond Index I BC Long Government/Credit 1 80 Turnover 3 Year to 1 3 5 Top Ten Holdings Performance 60 Months Date Year Years Years US Treasury Bond 3.625% 2.34% Vanguard Long-Term Bond Index I 1.27 13.57 13.06 4.69 8.04 US Treasury Bond 3.125% 1.85% BC Long Government/Credit 1.04 12.97 12.87 4.75 8.04 US Treasury Bond 3.75% 1.76% 40 Universe(5%) 2.12 13.37 12.98 6.35 8.42 US Treasury Bond 2.75% 1.74% Universe(25%) 1.36 11.52 11.49 5.52 8.13 US Treasury Bond 3.375% 1.70% Universe(Median) 0.68 8.82 9.11 4.87 7.68 US Treasury Bond 2.75% 1.68% 20 Universe(75%) -0.13 6.20 6.79 3.65 5.25 US Treasury Bond 3.625% 1.35% Universe(95%) -0.40 2.70 1.72 1.06 3.36 US Treasury Bond 4.25% 1.34% 0 0 US Treasury Bond 4.75% 1.24% Prospectus Exp Ratio Turnover Ratio US Treasury Bond 4.375% 1.06% City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 26 23

Quarterly Investment Monitor Data as of 09/30/2014 Vanguard Long-Term Bond Index I Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 25 0 20 25 Total Return Rank, % 15 10 50 Total Return, % 5 0 75 -5 -10 100 Oct-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Sep-14 -15 -20 Up/Down Market Capture Ratio -25 Oct-11 - Sep-14 120 -30 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 100 Up Mkt Capture Ratio, % Vanguard Long-Term Bond Index I BC Long Government/Credit 80 Annual Return % 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 60 Vanguard Long-Term Bond Index I 8.40 5.32 2.75 6.71 8.77 1.91 10.43 22.23 8.63 -9.01 BC Long Government/Credit 8.56 5.33 2.71 6.60 8.44 1.92 10.16 22.49 8.78 -8.83 40 20 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 5 2 9 7 0 -20 0 20 40 60 80 100 120 8 Down Mkt Capture Ratio, % 4 6 7 Excess Annualized StdDev, % Morningstar Long Term Bond Universe Vanguard Long-Term Bond Index I Total Annualized StdDev, % 3 5 6 BC Long Government/Credit Sharpe Ratio 2 4 Alpha, % 5 1 4 1 3 Return vs. Risk 3 0 2 Oct-11 - Sep-14 2 7 -1 1 1 6 Total Annualized Return, % -2 0 0 0 5 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 4 Vanguard Long-Term Bond Index I BC Long Government/Credit 3 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error 2 Vanguard Long-Term Bond Index I -0.12 1.02 99.01 0.58 8.45 0.85 1 BC Long Government/Credit 0.00 1.00 100.00 0.59 8.27 0.00 Universe(5%) 4.30 1.00 98.03 1.44 8.34 6.47 0 0 1 2 3 4 5 6 7 8 9 Universe(25%) 2.14 0.89 93.32 0.92 7.61 5.01 Universe(Median) 0.73 0.51 85.78 0.70 4.78 4.56 Total Annualized StdDev, % Universe(75%) 0.24 0.46 73.95 0.62 4.42 2.28 Morningstar Long Term Bond Universe Vanguard Long-Term Bond Index I Universe(95%) -1.11 0.28 52.90 0.34 3.37 1.14 Cash BC Long Government/Credit City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 27 24

Quarterly Investment Monitor Data as of 09/30/2014 PIMCO Long Duration Total Return Instl 4.79 Portfolio Information Investment Strategy Summary % Cash Ticker PLRIX % US Stocks The investment seeks maximum total return, consistent with prudent investment Morningstar Category Long-term Bond 31.51 % Bonds management. The fund invests at least 65% of its total assets in a diversified portfolio of Avg Mkt Cap $MM NA % Non-US Stocks Fixed Income Instruments of varying maturities, which may be represented by forwards or Cat Med Mkt Cap $MM NA % Pref derivatives such as options, futures contracts or swap agreements. It invests primarily in Net Assets $MM 5516.37 % Conv investment grade debt securities, but may invest up to 10% of its total assets in high yield Turnover Ratio 70.00 securities ("junk bonds") that are rated B or higher by Moody's, or equivalently rated by S&P % Other % Assets in Top 10 Holdings 46.20 or Fitch, or, if unrated, determined by PIMCO to be of comparable quality. % Non-US Bonds Total Number of Holdings 756.00 62.68 Manager Name Stephen A. Rodosky _________________________________________________________________________ Manager Tenure 7.17 Fund Incept Date 08/31/2006 Prospectus Exp Ratio 0.50 Phone Number 888-877-4626 Performance vs. Peer Group Portfolio Region Portfolio Structure % United States 100.00 % Cash 4.79 14 % Canada 0.00 % US Stocks 0.06 % Latin America 0.00 % Bonds 62.68 % United Kingdom 0.00 % Non-US Stocks 0.00 12 % Eurozone 0.00 % Pref 0.47 Portfolio Ratings Total Annualized Return, % % Europe - ex Euro 0.00 % Conv 0.00 Mstar Rating 10 % Europe - Emerging 0.00 % Other 0.48 3 Year Mstar Rating % Africa 0.00 % Non-US Bonds 31.51 % Rank Cat 3 Yr 10 % Middle East 0.00 5 Year Mstar Rating 8 % Japan 0.00 % Rank Cat 5 Yr 8 % Australasia 0.00 10 Year Mstar Rating NA % Asia - Developed 0.00 6 % Rank Cat 10 Yr NA % Asia - Emerging 0.00 4 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 2 % Basic Materials 0.00 Avg Eff Duration 13.16 2 160 % Communication Services 0.00 Effective Maturity 20.61 % Consumer Cyclical 0.00 Avg Credit Quality NA 0 % Consumer Defensive 0.00 AAA NA 140 % Healthcare 0.00 AA NA % Industrials 0.00 A NA -2 120 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 0.00 BBB NA % Technology 0.00 BB NA % Energy 0.00 B NA 5th to 25th Percentile 25th to Median 100 Prospectus Exp Ratio % Financial Services 4.89 Below B NA Median to 75th Percentile 75th to 95th Percentile % Utilities 95.11 NR/NA NA Ratio PIMCO Long Duration Total Return Instl BC Long Government/Credit 1 80 Turnover 3 Year to 1 3 5 Top Ten Holdings Performance 60 Months Date Year Years Years Fin Fut Euro$ Cme 06/15/15 19.44% PIMCO Long Duration Total Return Instl 1.22 13.29 13.05 5.43 8.17 Cdx Ig22 5y Bp Ice 9.02% BC Long Government/Credit 1.04 12.97 12.87 4.75 8.04 US Treasury Bond 2.75% 3.55% 40 Universe(5%) 2.12 13.37 12.98 6.35 8.42 US Treasury Bond 3.125% 2.73% Universe(25%) 1.36 11.52 11.49 5.52 8.13 Resolution Fdg Fed Bk Prin Stp 2.20% Universe(Median) 0.68 8.82 9.11 4.87 7.68 US Treasury Bond 3.125% 2.11% 20 Universe(75%) -0.13 6.20 6.79 3.65 5.25 U S Treas Bd Stripped Prin Pmt 2.07% Universe(95%) -0.40 2.70 1.72 1.06 3.36 Resolution Fdg Fed Bk Prin Stp 1.71% 0 0 US Treasury Bond 4.375% 1.71% Prospectus Exp Ratio Turnover Ratio AID 5.5% 1.67% City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 28 25

Quarterly Investment Monitor Data as of 09/30/2014 PIMCO Long Duration Total Return Instl Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 25 0 20 25 Total Return Rank, % 15 10 50 Total Return, % 5 0 75 -5 -10 100 Oct-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Sep-14 -15 -20 Up/Down Market Capture Ratio -25 Oct-11 - Sep-14 120 -30 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 100 Up Mkt Capture Ratio, % PIMCO Long Duration Total Return Instl BC Long Government/Credit 80 Annual Return % 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 60 PIMCO Long Duration Total Return Instl NA NA NA 7.83 12.38 5.62 11.64 18.57 10.28 -8.56 BC Long Government/Credit 8.56 5.33 2.71 6.60 8.44 1.92 10.16 22.49 8.78 -8.83 40 20 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 5 2 9 7 0 -20 0 20 40 60 80 100 120 8 Down Mkt Capture Ratio, % 4 6 7 Excess Annualized StdDev, % Morningstar Long Term Bond Universe PIMCO Long Duration Total Return Instl Total Annualized StdDev, % 3 5 6 BC Long Government/Credit Sharpe Ratio 2 4 Alpha, % 5 1 4 1 3 Return vs. Risk 3 0 2 Oct-11 - Sep-14 2 7 -1 1 1 6 Total Annualized Return, % -2 0 0 0 5 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 4 PIMCO Long Duration Total Return Instl BC Long Government/Credit 3 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error 2 PIMCO Long Duration Total Return Instl 0.75 0.98 96.24 0.67 8.26 1.61 1 BC Long Government/Credit 0.00 1.00 100.00 0.59 8.27 0.00 Universe(5%) 4.30 1.00 98.03 1.44 8.34 6.47 0 0 1 2 3 4 5 6 7 8 9 Universe(25%) 2.14 0.89 93.32 0.92 7.61 5.01 Universe(Median) 0.73 0.51 85.78 0.70 4.78 4.56 Total Annualized StdDev, % Universe(75%) 0.24 0.46 73.95 0.62 4.42 2.28 Morningstar Long Term Bond Universe PIMCO Long Duration Total Return Instl Universe(95%) -1.11 0.28 52.90 0.34 3.37 1.14 Cash BC Long Government/Credit City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 29 26

Quarterly Investment Monitor Data as of 09/30/2014 Ivy High Income I 3.60 Portfolio Information Investment Strategy Summary % Cash Ticker IVHIX % US Stocks The investment seeks to provide total return through a combination of high current income Morningstar Category High Yield Bond % Bonds and capital appreciation. The fund invests primarily in a diversified portfolio of high-yield, Avg Mkt Cap $MM 23763.36 % Non-US Stocks high-risk, fixed income securities, including secured and unsecured loan assignments, loan Cat Med Mkt Cap $MM 12586.60 % Pref participations and other loan instruments (loans), of U.S. and foreign issuers, the risks of 52.68 Net Assets $MM 10636.43 40.64 % Conv which are, in the judgment of the adviser consistent with the fund's objective. It invests Turnover Ratio 75.00 primarily in lower quality debt securities, which include debt securities rated BBB+ or lower. % Other % Assets in Top 10 Holdings 11.77 % Non-US Bonds Total Number of Holdings 422.00 _________________________________________________________________________ Manager Name Chad A. Gunther Manager Tenure 0.23 Fund Incept Date 07/31/1997 2.13 Prospectus Exp Ratio 0.69 Phone Number 800-777-6472 Performance vs. Peer Group Portfolio Region Portfolio Structure % United States 63.43 % Cash 3.60 14 % Canada 0.00 % US Stocks 0.57 % Latin America 0.00 % Bonds 52.68 12 % United Kingdom 36.57 % Non-US Stocks 0.33 % Eurozone 0.00 % Pref 0.02 Portfolio Ratings Total Annualized Return, % % Europe - ex Euro 0.00 % Conv 0.04 Mstar Rating 10 % Europe - Emerging 0.00 % Other 2.13 3 Year Mstar Rating % Africa 0.00 % Non-US Bonds 40.64 % Rank Cat 3 Yr 8 8 % Middle East 0.00 5 Year Mstar Rating % Japan 0.00 % Rank Cat 5 Yr 3 6 % Australasia 0.00 10 Year Mstar Rating % Asia - Developed 0.00 % Rank Cat 10 Yr 2 % Asia - Emerging 0.00 4 2 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group % Basic Materials 0.00 Avg Eff Duration 3.90 2 160 0 % Communication Services 56.75 Effective Maturity 4.65 % Consumer Cyclical 43.25 Avg Credit Quality B -2 % Consumer Defensive 0.00 AAA 0.00 140 % Healthcare 0.00 AA 0.00 % Industrials 0.00 A 1.02 -4 120 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 0.00 BBB 1.76 % Technology 0.00 BB 20.12 % Energy 0.00 B 41.38 5th to 25th Percentile 25th to Median 100 Prospectus Exp Ratio % Financial Services 0.00 Below B 35.28 Median to 75th Percentile 75th to 95th Percentile % Utilities 0.00 NR/NA 0.44 Ratio Ivy High Income I BC High Yield Corporate Bond 1 80 Turnover 3 Year to 1 3 5 Top Ten Holdings Performance 60 Months Date Year Years Years Magic 2 Lien (Misys Plc) 2.02% Ivy High Income I -1.27 3.40 6.88 12.30 11.55 Laureate Educ 144A 9.25% 1.71% BC High Yield Corporate Bond -1.87 3.49 7.20 11.09 10.57 Formula 1 (Proj Green Ii) 1.41% 40 Universe(5%) -0.99 4.69 8.65 12.82 11.46 Hd Sply 11.5% 1.12% Universe(25%) -1.69 3.47 7.14 11.00 10.20 Tmx Fin Llc/Titlemax Fin 144A 8.5% 1.02% Universe(Median) -2.02 2.93 6.33 10.28 9.57 Eagle Midco 144A 9% 0.98% 20 Universe(75%) -2.27 2.37 5.69 9.33 8.95 Onex Usi Acquisition 144A 7.75% 0.94% Universe(95%) -2.96 1.42 3.87 6.69 7.43 Jo-Ann Stores 144A 9.75% 0.88% 0 0 Bakercorp Intl 144A 8.25% 0.84% Prospectus Exp Ratio Turnover Ratio Pinnacle Operating Corporation 144A 9% 0.84% City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 30 27

Quarterly Investment Monitor Data as of 09/30/2014 Ivy High Income I Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 80 0 25 Total Return Rank, % 60 50 40 Total Return, % 75 20 100 0 Oct-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Sep-14 -20 Up/Down Market Capture Ratio Oct-11 - Sep-14 140 -40 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 120 Up Mkt Capture Ratio, % Ivy High Income I BC High Yield Corporate Bond 100 Annual Return % 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 80 Ivy High Income I 7.58 0.59 9.69 4.05 -19.73 46.56 15.62 6.44 17.16 10.46 60 BC High Yield Corporate Bond 11.13 2.74 11.85 1.87 -26.16 58.21 15.12 4.98 15.81 7.44 40 20 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 4 3 8 5 0 -20 0 20 40 60 80 100 120 140 160 180 7 Down Mkt Capture Ratio, % 3 4 Excess Annualized StdDev, % 6 Morningstar High Yield Universe Ivy High Income I Total Annualized StdDev, % 2 2 BC High Yield Corporate Bond 5 Sharpe Ratio 3 Alpha, % 1 4 2 Return vs. Risk 3 0 1 Oct-11 - Sep-14 2 16 1 -1 1 14 Total Annualized Return, % -2 0 0 0 12 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 10 Ivy High Income I BC High Yield Corporate Bond 8 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 6 Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error 4 Ivy High Income I 3.85 0.73 95.29 2.76 4.23 1.76 2 BC High Yield Corporate Bond 0.00 1.00 100.00 1.89 5.63 0.00 Universe(5%) 2.92 1.17 99.23 2.47 7.26 4.00 0 0 2 4 6 8 10 12 14 Universe(25%) 0.58 1.05 98.59 1.92 6.04 1.92 Universe(Median) -0.48 0.96 97.17 1.77 5.53 1.13 Total Annualized StdDev, % Universe(75%) -1.14 0.87 91.57 1.64 5.06 0.75 Morningstar High Yield Universe Ivy High Income I Universe(95%) -1.86 0.55 74.59 1.27 3.36 0.58 Cash BC High Yield Corporate Bond City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 31 28

Quarterly Investment Monitor Data as of 09/30/2014 Vanguard Equity-Income Adm 1.83 Portfolio Information Investment Strategy Summary 12.60 % Cash Ticker VEIRX % US Stocks The investment seeks to provide an above-average level of current income and reasonable Morningstar Category Large Value % Bonds long-term capital appreciation. The fund invests mainly in common stocks of mid-size and Avg Mkt Cap $MM 84587.18 % Non-US Stocks large companies whose stocks typically pay above-average levels of dividend income and are, Cat Med Mkt Cap $MM 87265.57 % Pref in the opinion of the purchasing advisor, undervalued relative to other stocks. In addition, Net Assets $MM 17846.81 % Conv the advisors generally look for companies that they believe are committed to paying Turnover Ratio 34.00 dividends consistently. Under normal circumstances, the fund will invest at least 80% of its % Other % Assets in Top 10 Holdings 30.20 assets in equity securities. The fund uses multiple investment advisors. % Non-US Bonds Total Number of Holdings 164.00 Manager Name James P. Stetler _________________________________________________________________________ 85.07 Manager Tenure 10.76 Fund Incept Date 03/21/1988 Prospectus Exp Ratio 0.21 Phone Number 800-662-7447 Performance vs. Peer Group Portfolio Region Portfolio Structure % United States 87.10 % Cash 1.83 30 % Canada 2.41 % US Stocks 85.07 % Latin America 0.00 % Bonds 0.00 % United Kingdom 4.11 % Non-US Stocks 12.60 25 % Eurozone 4.21 % Pref 0.00 Portfolio Ratings Total Annualized Return, % % Europe - ex Euro 2.16 % Conv 0.00 Mstar Rating % Europe - Emerging 0.00 % Other 0.50 3 Year Mstar Rating 20 % Africa 0.00 % Non-US Bonds 0.00 % Rank Cat 3 Yr 51 % Middle East 0.00 5 Year Mstar Rating % Japan 0.00 % Rank Cat 5 Yr 4 15 % Australasia 0.00 10 Year Mstar Rating % Asia - Developed 0.00 % Rank Cat 10 Yr 9 % Asia - Emerging 0.00 10 5 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group % Basic Materials 3.98 Avg Eff Duration NA 2 180 % Communication Services 4.42 Effective Maturity NA % Consumer Cyclical 5.40 Avg Credit Quality NA 0 160 % Consumer Defensive 12.39 AAA NA % Healthcare 12.67 AA NA % Industrials 12.46 A NA 140 -5 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 0.00 BBB NA % Technology 13.47 BB NA 120 % Energy 12.31 B NA 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services 16.30 Below B NA Median to 75th Percentile 75th to 95th Percentile % Utilities 6.60 NR/NA NA Ratio 100 Vanguard Equity-Income Adm S&P 500 Value 1 Turnover 80 3 Year to 1 3 5 Top Ten Holdings Performance Months Date Year Years Years Wells Fargo & Co 3.85% 60 Vanguard Equity-Income Adm -0.53 7.07 16.70 21.68 16.34 Johnson & Johnson 3.69% S&P 500 Value 0.25 7.23 17.77 23.46 14.73 Microsoft Corp 3.46% Universe(5%) 1.49 8.71 20.77 27.16 17.18 40 Exxon Mobil Corporation 3.23% Universe(25%) 0.12 7.50 18.27 23.75 15.00 Verizon Communications Inc 3.09% Universe(Median) -0.35 6.42 16.63 22.15 14.00 Chevron Corp 3.05% 20 Universe(75%) -1.09 4.87 14.42 20.04 12.92 Merck & Co Inc 2.80% Universe(95%) -2.98 2.87 10.91 16.07 10.58 JPMorgan Chase & Co 2.64% 0 0 Apple Inc 2.29% Prospectus Exp Ratio Turnover Ratio General Electric Co 2.09% City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 32 29

Quarterly Investment Monitor Data as of 09/30/2014 Vanguard Equity-Income Adm Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 50 0 40 25 Total Return Rank, % 30 20 50 Total Return, % 10 75 0 -10 100 -20 Oct-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Sep-14 -30 Up/Down Market Capture Ratio -40 Oct-11 - Sep-14 180 -50 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 160 Up Mkt Capture Ratio, % 140 Vanguard Equity-Income Adm S&P 500 Value 120 Annual Return % 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 100 Vanguard Equity-Income Adm 13.69 4.52 20.77 4.99 -30.86 17.26 14.99 10.69 13.58 30.19 80 S&P 500 Value 15.03 8.71 20.80 1.99 -39.22 21.18 15.10 -0.48 17.68 31.99 60 40 20 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 3 3 14 6 0 0 20 40 60 80 100 120 140 160 180 200 2 12 Down Mkt Capture Ratio, % 5 Excess Annualized StdDev, % 1 Morningstar Large Value Universe Vanguard Equity-Income Adm Total Annualized StdDev, % 10 2 4 S&P 500 Value 0 Sharpe Ratio 8 Alpha, % -1 3 6 Return vs. Risk -2 1 2 4 Oct-11 - Sep-14 -3 40 1 -4 2 35 Total Annualized Return, % -5 0 0 0 30 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 25 Vanguard Equity-Income Adm S&P 500 Value 20 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 15 Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error 10 Vanguard Equity-Income Adm 2.11 0.83 91.77 2.09 9.65 3.36 5 S&P 500 Value 0.00 1.00 100.00 1.95 11.15 0.00 Universe(5%) 2.63 1.14 98.22 2.11 13.39 5.75 0 0 2 4 6 8 10 12 14 16 18 20 22 Universe(25%) 0.79 1.05 96.42 1.98 11.98 3.79 Universe(Median) -0.32 0.98 94.61 1.87 11.23 2.81 Total Annualized StdDev, % Universe(75%) -1.93 0.90 90.63 1.71 10.26 2.19 Morningstar Large Value Universe Vanguard Equity-Income Adm Universe(95%) -4.28 0.74 82.67 1.47 8.94 1.63 Cash S&P 500 Value City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 33 30

Quarterly Investment Monitor Data as of 09/30/2014 Vanguard Growth Index Adm 2.09 Portfolio Information Investment Strategy Summary % Cash Ticker VIGAX % US Stocks The investment seeks to track the performance of a benchmark index that measures the Morningstar Category Large Growth % Bonds investment return of large-capitalization growth stocks. The fund employs an indexing Avg Mkt Cap $MM 51552.71 % Non-US Stocks investment approach designed to track the performance of the CRSP U.S. Large Cap Growth Cat Med Mkt Cap $MM 72963.17 % Pref Index, a broadly diversified index predominantly made up of growth stocks of large U.S. Net Assets $MM 41724.89 % Conv companies. It attempts to replicate the target index by investing all, or substantially all, of its Turnover Ratio 32.00 assets in the stocks that make up the index, holding each stock in approximately the same % Other % Assets in Top 10 Holdings 22.83 proportion as its weighting in the index. % Non-US Bonds Total Number of Holdings 373.00 Manager Name Gerard C. O'Reilly _________________________________________________________________________ Manager Tenure 19.76 97.72 Fund Incept Date 11/02/1992 Prospectus Exp Ratio 0.09 Phone Number 800-662-7447 Performance vs. Peer Group Portfolio Region Portfolio Structure % United States 97.91 % Cash 0.19 30 % Canada 0.16 % US Stocks 97.72 % Latin America 0.00 % Bonds 0.00 % United Kingdom 0.48 % Non-US Stocks 2.09 25 % Eurozone 1.05 % Pref 0.00 Portfolio Ratings Total Annualized Return, % % Europe - ex Euro 0.19 % Conv 0.00 Mstar Rating % Europe - Emerging 0.00 % Other 0.00 3 Year Mstar Rating 20 % Africa 0.00 % Non-US Bonds 0.00 % Rank Cat 3 Yr 25 % Middle East 0.00 5 Year Mstar Rating % Japan 0.00 % Rank Cat 5 Yr 13 15 % Australasia 0.00 10 Year Mstar Rating % Asia - Developed 0.21 % Rank Cat 10 Yr 26 % Asia - Emerging 0.00 10 5 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group % Basic Materials 3.07 Avg Eff Duration NA 2 300 % Communication Services 3.78 Effective Maturity NA % Consumer Cyclical 17.48 Avg Credit Quality NA 0 % Consumer Defensive 7.12 AAA NA % Healthcare 12.64 AA NA 250 % Industrials 10.68 A NA -5 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 4.99 BBB NA % Technology 25.56 BB NA 200 % Energy 8.39 B NA 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services 6.12 Below B NA Median to 75th Percentile 75th to 95th Percentile % Utilities 0.17 NR/NA NA Ratio Vanguard Growth Index Adm CRSP US Large Cap Growth TR USD 1 150 Turnover 3 Year to 1 3 5 Top Ten Holdings Performance Months Date Year Years Years Apple Inc 7.14% 100 Vanguard Growth Index Adm 1.05 8.11 19.31 22.94 16.62 Coca-Cola Co 1.91% CRSP US Large Cap Growth TR USD 1.06 8.18 19.38 22.30 15.52 Gilead Sciences Inc 1.91% Universe(5%) 3.20 10.38 22.80 25.46 18.33 Google Inc Class A 1.90% Universe(25%) 1.79 7.79 19.10 23.18 16.04 Google Inc Class C 1.89% 50 Universe(Median) 0.91 5.73 16.88 21.56 14.80 Facebook Inc Class A 1.72% Universe(75%) -0.14 4.19 14.67 20.01 13.49 Schlumberger NV 1.65% Universe(95%) -1.95 1.37 11.21 17.31 11.22 Walt Disney Co 1.62% 0 0 Oracle Corporation 1.60% Prospectus Exp Ratio Turnover Ratio Qualcomm Inc 1.48% City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 34 31

Quarterly Investment Monitor Data as of 09/30/2014 Vanguard Growth Index Adm Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 60 0 25 Total Return Rank, % 40 50 20 Total Return, % 75 0 100 -20 Oct-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Sep-14 -40 Up/Down Market Capture Ratio Oct-11 - Sep-14 250 -60 225 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 200 Up Mkt Capture Ratio, % Vanguard Growth Index Adm CRSP US Large Cap Growth TR USD 175 150 Annual Return % 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 125 Vanguard Growth Index Adm 7.31 5.21 9.13 12.70 -38.22 36.42 17.12 1.87 17.01 32.40 100 CRSP US Large Cap Growth TR USD 6.99 6.40 10.32 15.66 -38.67 35.92 15.77 0.58 15.20 31.75 75 50 25 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 4 2 16 7 0 0 25 50 75 100 125 150 175 200 225 3 14 6 Down Mkt Capture Ratio, % 2 Excess Annualized StdDev, % 12 Morningstar Large Growth Universe Vanguard Growth Index Adm Total Annualized StdDev, % 1 5 CRSP US Large Cap Growth TR USD 10 Sharpe Ratio 0 4 Alpha, % -1 1 8 -2 3 Return vs. Risk 6 -3 2 Oct-11 - Sep-14 4 55 -4 1 50 2 -5 Total Annualized Return, % 45 -6 0 0 0 40 35 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 30 Vanguard Growth Index Adm CRSP US Large Cap Growth TR USD 25 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 20 Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error 15 Vanguard Growth Index Adm 0.71 0.99 99.79 1.83 11.70 0.55 10 CRSP US Large Cap Growth TR USD 0.00 1.00 100.00 1.77 11.80 0.00 5 Universe(5%) 3.06 1.18 97.05 1.96 15.12 6.90 0 0 5 10 15 20 25 30 Universe(25%) 0.87 1.08 95.04 1.76 13.34 4.41 Universe(Median) -0.62 1.02 92.47 1.65 12.54 3.65 Total Annualized StdDev, % Universe(75%) -2.59 0.95 88.61 1.50 11.62 2.83 Morningstar Large Growth Universe Vanguard Growth Index Adm Universe(95%) -5.70 0.84 79.60 1.26 10.39 2.08 Cash CRSP US Large Cap Growth TR USD City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 35 32

Quarterly Investment Monitor Data as of 09/30/2014 Vanguard PRIMECAP Inv 5.07 Portfolio Information Investment Strategy Summary 11.74 % Cash Ticker VPMCX % US Stocks The investment seeks long-term capital appreciation. The fund invests in stocks considered to Morningstar Category Large Growth % Bonds have above-average earnings growth potential that is not reflected in their current market Avg Mkt Cap $MM 62454.98 % Non-US Stocks prices. Its portfolio consists predominantly of large- and mid-capitalization stocks. Cat Med Mkt Cap $MM 72963.17 % Pref Net Assets $MM 44255.36 % Conv _________________________________________________________________________ Turnover Ratio 5.00 % Other % Assets in Top 10 Holdings 40.26 % Non-US Bonds Total Number of Holdings 125.00 Manager Name Joel P. Fried Manager Tenure 25.76 83.19 Fund Incept Date 11/01/1984 Prospectus Exp Ratio 0.45 Phone Number 800-662-7447 Performance vs. Peer Group Portfolio Region Portfolio Structure % United States 87.63 % Cash 5.07 30 % Canada 1.11 % US Stocks 83.19 % Latin America 0.04 % Bonds 0.00 % United Kingdom 0.66 % Non-US Stocks 11.74 25 % Eurozone 0.99 % Pref 0.00 Portfolio Ratings Total Annualized Return, % % Europe - ex Euro 9.16 % Conv 0.00 Mstar Rating % Europe - Emerging 0.00 % Other 0.00 3 Year Mstar Rating 20 % Africa 0.00 % Non-US Bonds 0.00 % Rank Cat 3 Yr 2 % Middle East 0.00 5 Year Mstar Rating % Japan 0.41 % Rank Cat 5 Yr 11 15 % Australasia 0.00 10 Year Mstar Rating % Asia - Developed 0.00 % Rank Cat 10 Yr 6 % Asia - Emerging 0.00 10 5 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group % Basic Materials 2.78 Avg Eff Duration NA 2 300 % Communication Services 1.76 Effective Maturity NA % Consumer Cyclical 5.25 Avg Credit Quality NA 0 % Consumer Defensive 0.56 AAA NA % Healthcare 30.96 AA NA 250 % Industrials 15.21 A NA -5 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 0.00 BBB NA % Technology 32.31 BB NA 200 % Energy 5.17 B NA 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services 6.00 Below B NA Median to 75th Percentile 75th to 95th Percentile % Utilities 0.00 NR/NA NA Ratio Vanguard PRIMECAP Inv S&P 500 Growth 1 150 Turnover 3 Year to 1 3 5 Top Ten Holdings Performance Months Date Year Years Years Biogen Idec Inc 7.23% 100 Vanguard PRIMECAP Inv 2.66 12.81 24.72 26.15 16.95 Amgen Inc 4.33% S&P 500 Growth 1.92 9.36 21.55 22.62 16.64 Eli Lilly and Co 4.16% Universe(5%) 3.20 10.38 22.80 25.46 18.33 Roche Holding AG 4.02% Universe(25%) 1.79 7.79 19.10 23.18 16.04 FedEx Corp 3.95% 50 Universe(Median) 0.91 5.73 16.88 21.56 14.80 Adobe Systems Inc 3.88% Universe(75%) -0.14 4.19 14.67 20.01 13.49 Texas Instruments Inc 3.78% Universe(95%) -1.95 1.37 11.21 17.31 11.22 Microsoft Corp 3.75% 0 0 Novartis AG ADR 2.89% Prospectus Exp Ratio Turnover Ratio Medtronic Inc 2.25% City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 36 33

Quarterly Investment Monitor Data as of 09/30/2014 Vanguard PRIMECAP Inv Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 60 0 25 Total Return Rank, % 40 50 20 Total Return, % 75 0 100 -20 Oct-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Sep-14 -40 Up/Down Market Capture Ratio Oct-11 - Sep-14 300 -60 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 250 Up Mkt Capture Ratio, % Vanguard PRIMECAP Inv S&P 500 Growth 200 Annual Return % 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 150 Vanguard PRIMECAP Inv 18.31 8.49 12.30 11.49 -32.41 34.45 12.89 -1.84 15.27 39.73 S&P 500 Growth 6.97 1.14 11.01 9.13 -34.92 31.57 15.05 4.65 14.61 32.75 100 50 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 4 3 16 9 0 0 50 100 150 200 250 300 14 8 Down Mkt Capture Ratio, % 2 7 Excess Annualized StdDev, % 12 Morningstar Large Growth Universe Vanguard PRIMECAP Inv Total Annualized StdDev, % 0 2 6 S&P 500 Growth 10 Sharpe Ratio -2 Alpha, % 5 8 4 -4 Return vs. Risk 6 1 3 -6 Oct-11 - Sep-14 4 55 2 -8 50 2 1 Total Annualized Return, % 45 -10 0 0 0 40 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 35 Vanguard PRIMECAP Inv S&P 500 Growth 30 25 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 20 Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error 15 Vanguard PRIMECAP Inv 3.38 0.98 88.27 2.20 10.86 3.73 10 S&P 500 Growth 0.00 1.00 100.00 2.02 10.43 0.00 5 Universe(5%) 0.43 1.30 96.15 1.96 15.12 8.02 0 0 5 10 15 20 25 30 Universe(25%) -1.84 1.19 92.41 1.76 13.34 5.35 Universe(Median) -3.16 1.14 89.34 1.65 12.54 4.37 Total Annualized StdDev, % Universe(75%) -5.03 1.07 85.20 1.50 11.62 3.42 Morningstar Large Growth Universe Vanguard PRIMECAP Inv Universe(95%) -8.15 0.95 75.81 1.26 10.39 2.39 Cash S&P 500 Growth City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 37 34

Quarterly Investment Monitor Data as of 09/30/2014 Vanguard Mid-Cap Value Index Admiral 2.02 Portfolio Information Investment Strategy Summary % Cash Ticker VMVAX % US Stocks The investment seeks to track the performance of a benchmark index that measures the Morningstar Category Mid-Cap Value % Bonds investment return of mid-capitalization value stocks. The fund employs an indexing Avg Mkt Cap $MM 10040.74 % Non-US Stocks investment approach designed to track the performance of the CRSP US Mid Cap Value Cat Med Mkt Cap $MM 8727.26 % Pref Index, a broadly diversified index of value stocks of mid-size U.S. companies. It attempts to Net Assets $MM 6098.25 % Conv replicate the target index by investing all, or substantially all, of its assets in the stocks that Turnover Ratio 46.00 make up the index, holding each stock in approximately the same proportion as its weighting % Other % Assets in Top 10 Holdings 11.52 in the index. % Non-US Bonds Total Number of Holdings 204.00 Manager Name Donald M. Butler _________________________________________________________________________ Manager Tenure 8.13 97.84 Fund Incept Date 09/27/2011 Prospectus Exp Ratio 0.09 Phone Number 800-662-7447 Performance vs. Peer Group Portfolio Region Portfolio Structure % United States 97.98 % Cash 0.14 30 % Canada 0.00 % US Stocks 97.84 % Latin America 0.00 % Bonds 0.00 % United Kingdom 1.77 % Non-US Stocks 2.02 25 % Eurozone 0.00 % Pref 0.00 Portfolio Ratings Total Annualized Return, % % Europe - ex Euro 0.26 % Conv 0.00 Mstar Rating 20 % Europe - Emerging 0.00 % Other 0.00 3 Year Mstar Rating % Africa 0.00 % Non-US Bonds 0.00 % Rank Cat 3 Yr 21 % Middle East 0.00 5 Year Mstar Rating 15 % Japan 0.00 % Rank Cat 5 Yr 15 % Australasia 0.00 10 Year Mstar Rating NA % Asia - Developed 0.00 10 % Rank Cat 10 Yr NA % Asia - Emerging 0.00 5 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 0 % Basic Materials 7.03 Avg Eff Duration NA 3 180 % Communication Services 0.85 Effective Maturity NA % Consumer Cyclical 15.68 Avg Credit Quality NA -5 160 % Consumer Defensive 8.65 AAA NA % Healthcare 8.55 AA NA % Industrials 10.87 A NA 140 -10 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 4.37 BBB NA % Technology 9.73 BB NA 2 120 % Energy 6.66 B NA 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services 18.04 Below B NA Median to 75th Percentile 75th to 95th Percentile % Utilities 9.58 NR/NA NA Ratio 100 Vanguard Mid-Cap Value Index Admiral CRSP US Mid Cap Value TR USD Turnover 80 3 Year to 1 3 5 Top Ten Holdings Performance Months Date Year Years Years Western Digital Corp 1.43% 1 60 Vanguard Mid-Cap Value Index Admiral -2.24 6.56 17.81 24.68 16.97 Delphi Automotive PLC 1.32% CRSP US Mid Cap Value TR USD -2.26 6.61 17.87 24.89 17.73 Alcoa Inc 1.21% Universe(5%) -0.53 8.45 19.05 26.96 17.70 40 Seagate Technology PLC 1.21% Universe(25%) -1.99 6.38 15.71 24.27 16.33 Mylan Inc 1.13% Universe(Median) -3.25 4.49 13.92 22.71 15.27 United Continental Holdings Inc 1.11% 20 Universe(75%) -4.47 1.96 11.24 20.28 13.55 Boston Scientific Inc 1.04% Universe(95%) -6.37 -0.71 6.78 14.50 10.17 Hartford Financial Services Group Inc 1.04% 0 0 AmerisourceBergen Corp 1.03% Prospectus Exp Ratio Turnover Ratio Principal Financial Group 0.99% City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 38 35

Quarterly Investment Monitor Data as of 09/30/2014 Vanguard Mid-Cap Value Index Admiral Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 60 0 25 Total Return Rank, % 40 50 20 Total Return, % 75 0 100 -20 Oct-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Sep-14 -40 Up/Down Market Capture Ratio Oct-11 - Sep-14 160 -60 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 140 Up Mkt Capture Ratio, % Vanguard Mid-Cap Value Index Admiral CRSP US Mid Cap Value TR USD 120 100 Annual Return % 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 80 Vanguard Mid-Cap Value Index Admiral NA NA NA -4.27 -36.54 37.74 21.82 -0.29 16.02 37.66 CRSP US Mid Cap Value TR USD 24.07 11.67 19.91 -6.07 -37.95 35.21 24.58 -0.39 17.90 37.38 60 40 20 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 3 3 16 8 0 0 20 40 60 80 100 120 140 160 180 2 14 7 Down Mkt Capture Ratio, % 1 Excess Annualized StdDev, % 0 12 6 Morningstar Midcap Value Universe Vanguard Mid-Cap Value Index Admiral Total Annualized StdDev, % -1 2 CRSP US Mid Cap Value TR USD 10 5 Sharpe Ratio -2 Alpha, % -3 8 4 -4 Return vs. Risk 6 3 -5 1 Oct-11 - Sep-14 -6 4 2 40 -7 2 1 35 Total Annualized Return, % -8 -9 0 0 0 30 25 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile Vanguard Mid-Cap Value Index Admiral CRSP US Mid Cap Value TR USD 20 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 15 Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error 10 Vanguard Mid-Cap Value Index Admiral -0.44 1.01 99.53 1.95 11.75 0.82 5 CRSP US Mid Cap Value TR USD 0.00 1.00 100.00 1.99 11.57 0.00 Universe(5%) 2.05 1.23 96.55 2.13 15.86 7.55 0 0 2 4 6 8 10 12 14 16 18 20 Universe(25%) -0.76 1.12 95.17 1.86 13.61 4.72 Universe(Median) -2.20 1.04 93.70 1.67 12.50 3.65 Total Annualized StdDev, % Universe(75%) -4.90 0.94 88.35 1.54 11.05 2.86 Morningstar Midcap Value Universe Vanguard Mid-Cap Value Index Admiral Universe(95%) -8.13 0.70 70.50 1.20 9.42 2.22 Cash CRSP US Mid Cap Value TR USD City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 39 36

Quarterly Investment Monitor Data as of 09/30/2014 Vanguard Mid Cap Index Adm 3.28 Portfolio Information Investment Strategy Summary % Cash Ticker VIMAX % US Stocks The investment seeks to track the performance of a benchmark index that measures the Morningstar Category Mid-Cap Blend % Bonds investment return of mid-capitalization stocks. The fund employs an indexing investment Avg Mkt Cap $MM 10731.74 % Non-US Stocks approach designed to track the performance of the CRSP U.S. Mid Cap Index, a broadly Cat Med Mkt Cap $MM 8270.60 % Pref diversified index of stocks of mid-size U.S. companies. It attempts to replicate the target Net Assets $MM 53313.89 % Conv index by investing all, or substantially all, of its assets in the stocks that make up the index, Turnover Ratio 32.00 holding each stock in approximately the same proportion as its weighting in the index. % Other % Assets in Top 10 Holdings 6.46 % Non-US Bonds Total Number of Holdings 378.00 _________________________________________________________________________ Manager Name Donald M. Butler Manager Tenure 16.37 96.48 Fund Incept Date 05/21/1998 Prospectus Exp Ratio 0.09 Phone Number 800-662-7447 Performance vs. Peer Group Portfolio Region Portfolio Structure % United States 96.71 % Cash 0.24 30 % Canada 0.43 % US Stocks 96.48 % Latin America 0.00 % Bonds 0.00 % United Kingdom 1.29 % Non-US Stocks 3.28 25 % Eurozone 0.74 % Pref 0.00 Portfolio Ratings Total Annualized Return, % % Europe - ex Euro 0.26 % Conv 0.00 Mstar Rating 20 % Europe - Emerging 0.00 % Other 0.00 3 Year Mstar Rating % Africa 0.00 % Non-US Bonds 0.00 % Rank Cat 3 Yr 37 % Middle East 0.00 5 Year Mstar Rating 15 % Japan 0.00 % Rank Cat 5 Yr 12 % Australasia 0.00 10 Year Mstar Rating % Asia - Developed 0.58 10 % Rank Cat 10 Yr 12 % Asia - Emerging 0.00 5 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 0 % Basic Materials 5.90 Avg Eff Duration NA 3 300 % Communication Services 1.50 Effective Maturity NA % Consumer Cyclical 17.61 Avg Credit Quality NA -5 % Consumer Defensive 7.04 AAA NA % Healthcare 9.71 AA NA 250 % Industrials 14.99 A NA -10 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 5.63 BBB NA % Technology 14.54 BB NA 2 200 % Energy 7.63 B NA 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services 10.36 Below B NA Median to 75th Percentile 75th to 95th Percentile % Utilities 5.07 NR/NA NA Ratio Vanguard Mid Cap Index Adm CRSP US Mid Cap TR USD 150 Turnover 3 Year to 1 3 5 Top Ten Holdings Performance Months Date Year Years Years Western Digital Corp 0.71% 1 100 Vanguard Mid Cap Index Adm -1.16 6.68 15.88 23.31 17.03 Southwest Airlines Co 0.68% CRSP US Mid Cap TR USD -1.15 6.73 15.94 23.30 17.17 Vertex Pharmaceuticals Inc 0.68% Universe(5%) -0.46 6.88 18.59 28.31 18.28 Chipotle Mexican Grill Inc Class A 0.65% Universe(25%) -2.00 4.71 14.94 23.75 16.23 Delphi Automotive PLC 0.65% 50 Universe(Median) -3.30 2.70 11.53 22.14 15.27 Health Care REIT, Inc. 0.64% Universe(75%) -4.65 0.93 9.70 20.04 13.76 AvalonBay Communities Inc 0.62% Universe(95%) -6.21 -1.62 5.93 14.61 10.30 Moody's Corporation 0.62% 0 0 Alcoa Inc 0.60% Prospectus Exp Ratio Turnover Ratio Seagate Technology PLC 0.60% City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 40 37

Quarterly Investment Monitor Data as of 09/30/2014 Vanguard Mid Cap Index Adm Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 80 0 60 25 Total Return Rank, % 40 50 Total Return, % 20 75 0 100 Oct-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Sep-14 -20 Up/Down Market Capture Ratio -40 Oct-11 - Sep-14 225 -60 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 200 Up Mkt Capture Ratio, % 175 Vanguard Mid Cap Index Adm CRSP US Mid Cap TR USD 150 Annual Return % 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 125 Vanguard Mid Cap Index Adm 20.42 14.04 13.69 6.17 -41.78 40.48 25.59 -1.97 15.99 35.15 100 CRSP US Mid Cap TR USD 20.28 13.31 15.32 7.04 -41.83 36.90 26.16 -1.79 16.69 35.27 75 50 25 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 3 2 18 8 0 0 25 50 75 100 125 150 175 200 225 250 2 16 7 Down Mkt Capture Ratio, % 1 14 Excess Annualized StdDev, % 6 Morningstar Midcap Blend Universe Vanguard Mid Cap Index Adm Total Annualized StdDev, % 0 12 CRSP US Mid Cap TR USD -1 5 Sharpe Ratio Alpha, % -2 10 1 4 -3 8 Return vs. Risk -4 3 6 Oct-11 - Sep-14 -5 2 45 4 -6 1 40 2 Total Annualized Return, % -7 35 -8 0 0 0 30 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 25 Vanguard Mid Cap Index Adm CRSP US Mid Cap TR USD 20 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 15 Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error 10 Vanguard Mid Cap Index Adm -0.41 1.02 99.85 1.75 12.48 0.55 CRSP US Mid Cap TR USD 0.00 1.00 100.00 1.78 12.22 0.00 5 Universe(5%) 2.70 1.24 97.08 1.89 16.08 7.72 0 0 5 10 15 20 25 30 Universe(25%) 0.01 1.12 96.35 1.69 14.10 4.94 Universe(Median) -2.24 1.07 93.12 1.57 13.38 3.75 Total Annualized StdDev, % Universe(75%) -3.14 0.96 89.45 1.49 12.40 2.91 Morningstar Midcap Blend Universe Vanguard Mid Cap Index Adm Universe(95%) -7.05 0.73 76.35 1.19 9.95 2.39 Cash CRSP US Mid Cap TR USD City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 41 38

Quarterly Investment Monitor Data as of 09/30/2014 Target Small Capitalization Value T 3.181.17 Portfolio Information Investment Strategy Summary % Cash Ticker TASVX % US Stocks The investment seeks above-average capital appreciation. The Portfolio seeks investments Morningstar Category Small Value % Bonds that will increase in value. It normally invests at least 80% of its investable assets in common Avg Mkt Cap $MM 2187.66 % Non-US Stocks stocks of small companies. Small companies are those companies with market capitalizations Cat Med Mkt Cap $MM 2553.48 % Pref comparable to those in the Russell 2000 Value Index. Market capitalization is measured at Net Assets $MM 1968.99 % Conv the time of purchase. Turnover Ratio NA % Other % Assets in Top 10 Holdings 7.16 _________________________________________________________________________ % Non-US Bonds Total Number of Holdings 778.00 Manager Name Paul E. Viera Manager Tenure 12.76 95.55 Fund Incept Date 01/05/1993 Prospectus Exp Ratio 0.68 Phone Number 800-225-1852 Performance vs. Peer Group Portfolio Region Portfolio Structure % United States 98.79 % Cash 3.18 30 % Canada 0.65 % US Stocks 95.55 % Latin America 0.27 % Bonds 0.00 % United Kingdom 0.02 % Non-US Stocks 1.17 25 % Eurozone 0.07 % Pref 0.00 Portfolio Ratings Total Annualized Return, % % Europe - ex Euro 0.00 % Conv 0.00 Mstar Rating 20 % Europe - Emerging 0.00 % Other 0.10 3 Year Mstar Rating % Africa 0.00 % Non-US Bonds 0.00 % Rank Cat 3 Yr 58 % Middle East 0.21 5 Year Mstar Rating 15 % Japan 0.00 % Rank Cat 5 Yr 25 % Australasia 0.00 10 Year Mstar Rating % Asia - Developed 0.00 10 % Rank Cat 10 Yr 10 % Asia - Emerging 0.00 5 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 0 % Basic Materials 5.92 Avg Eff Duration NA 2 200 % Communication Services 1.03 Effective Maturity NA % Consumer Cyclical 11.57 Avg Credit Quality NA 180 -5 % Consumer Defensive 3.52 AAA NA % Healthcare 7.29 AA NA 160 -10 % Industrials 19.96 A NA 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 5.58 BBB NA % Technology 12.67 BB NA 140 % Energy 5.89 B NA 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services 22.77 Below B NA 120 Median to 75th Percentile 75th to 95th Percentile % Utilities 3.80 NR/NA NA Ratio Target Small Capitalization Value T S&P 600 Value 1 100 Turnover 3 Year to 1 3 5 Top Ten Holdings 80 Performance Months Date Year Years Years EnerSys 0.83% Target Small Capitalization Value T -5.79 -1.27 7.42 20.62 14.66 Firstmerit Corp 0.75% 60 S&P 600 Value -6.78 -2.62 6.74 24.09 15.66 Teleflex Inc 0.75% Universe(5%) -3.53 1.96 11.89 26.20 17.55 American Equity Investment Life Holding Co 0.74% 40 Universe(25%) -5.88 -0.91 8.39 23.19 15.21 Bristow Group Inc 0.72% Universe(Median) -6.63 -2.65 6.36 21.29 14.08 Amsurg Corp 0.69% 20 Universe(75%) -7.60 -4.48 4.30 19.22 12.99 Silgan Holdings Inc 0.68% Universe(95%) -9.92 -6.58 -0.03 13.07 9.51 Webster Financial Corp 0.68% 0 0 GATX Corp 0.66% Prospectus Exp Ratio Turnover Ratio KAR Auction Services Inc 0.66% City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 42 39

Quarterly Investment Monitor Data as of 09/30/2014 Target Small Capitalization Value T Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 60 0 25 Total Return Rank, % 40 50 20 Total Return, % 75 0 100 -20 Oct-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Sep-14 -40 Up/Down Market Capture Ratio Oct-11 - Sep-14 120 -60 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 100 Up Mkt Capture Ratio, % Target Small Capitalization Value T S&P 600 Value 80 Annual Return % 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 60 Target Small Capitalization Value T 24.02 10.10 17.72 0.52 -27.45 26.69 23.63 -0.48 14.14 35.87 S&P 600 Value 23.25 6.45 19.57 -5.54 -29.51 22.85 24.72 -1.38 18.21 39.98 40 20 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 3 2 18 9 0 0 20 40 60 80 100 120 140 2 16 8 Down Mkt Capture Ratio, % 14 7 Excess Annualized StdDev, % 1 Morningstar SmallCap Value Universe Target Small Capitalization Value T Total Annualized StdDev, % 12 6 S&P 600 Value 0 Sharpe Ratio Alpha, % 10 5 -1 1 8 4 Return vs. Risk -2 6 3 Oct-11 - Sep-14 -3 30 4 2 -4 2 1 25 Total Annualized Return, % -5 0 0 0 20 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile Target Small Capitalization Value T S&P 600 Value 15 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 10 Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error Target Small Capitalization Value T -0.58 0.89 96.58 1.47 13.39 2.96 5 S&P 600 Value 0.00 1.00 100.00 1.54 14.78 0.00 Universe(5%) 2.79 1.15 97.84 1.66 17.41 8.62 0 0 2 4 6 8 10 12 14 16 18 20 22 Universe(25%) 0.00 1.02 96.48 1.48 15.43 4.74 Universe(Median) -1.11 0.97 94.81 1.40 14.63 3.72 Total Annualized StdDev, % Universe(75%) -2.57 0.90 91.13 1.32 13.73 2.84 Morningstar SmallCap Value Universe Target Small Capitalization Value T Universe(95%) -4.98 0.70 80.59 1.16 11.08 2.36 Cash S&P 600 Value City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 43 40

Quarterly Investment Monitor Data as of 09/30/2014 Oppenheimer International Growth Y 2.032.33 Portfolio Information Investment Strategy Summary % Cash Ticker OIGYX % US Stocks The investment seeks capital appreciation. The fund mainly invests in the common stock of Morningstar Category Foreign Large Growth % Bonds growth companies that are domiciled or have their primary operations outside of the United Avg Mkt Cap $MM 15525.25 % Non-US Stocks States. It may invest 100% of its assets in securities of foreign companies. The fund may Cat Med Mkt Cap $MM 31370.15 % Pref invest in emerging markets as well as in developed markets throughout the world. It Net Assets $MM 18021.18 % Conv normally will invest at least 65% of its total assets in common and preferred stocks of issuers Turnover Ratio 12.00 in at least three different countries outside of the United States, and emphasize investments % Other % Assets in Top 10 Holdings 14.29 in common stocks of issuers that the portfolio managers consider to be "growth" companies. % Non-US Bonds Total Number of Holdings 112.00 Manager Name George R. Evans Manager Tenure 18.53 _________________________________________________________________________ Fund Incept Date 03/25/1996 95.63 Prospectus Exp Ratio 0.90 Phone Number 800-225-5677 Performance vs. Peer Group Portfolio Region Portfolio Structure % United States 2.08 % Cash 2.33 20 % Canada 2.05 % US Stocks 2.03 % Latin America 1.87 % Bonds 0.00 % United Kingdom 28.86 % Non-US Stocks 95.63 15 % Eurozone 34.80 % Pref 0.01 Portfolio Ratings Total Annualized Return, % % Europe - ex Euro 19.42 % Conv 0.00 Mstar Rating % Europe - Emerging 0.00 % Other 0.00 3 Year Mstar Rating % Africa 0.00 % Non-US Bonds 0.00 % Rank Cat 3 Yr 26 10 % Middle East 0.00 5 Year Mstar Rating % Japan 5.08 % Rank Cat 5 Yr 15 % Australasia 2.76 10 Year Mstar Rating % Asia - Developed 0.00 5 % Rank Cat 10 Yr 1 % Asia - Emerging 3.08 0 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group % Basic Materials 4.37 Avg Eff Duration NA 2 180 % Communication Services 7.12 Effective Maturity NA -5 % Consumer Cyclical 19.61 Avg Credit Quality NA 160 % Consumer Defensive 15.11 AAA NA % Healthcare 10.27 AA NA % Industrials 22.18 A NA 140 -10 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 0.00 BBB NA % Technology 14.54 BB NA 120 % Energy 2.30 B NA 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services 4.26 Below B NA Median to 75th Percentile 75th to 95th Percentile % Utilities 0.24 NR/NA NA Ratio 100 Oppenheimer International Growth Y MSCI EAFE Large Growth NR USD 1 Turnover 80 3 Year to 1 3 5 Top Ten Holdings Performance Months Date Year Years Years SAP SE 1.61% 60 Oppenheimer International Growth Y -8.19 -6.00 -0.26 14.72 9.62 Essentra PLC 1.57% MSCI EAFE Large Growth NR USD -5.00 -2.05 3.11 13.43 7.56 Royal Boskalis Westminster NV 1.51% Universe(5%) -3.17 2.62 8.53 17.32 9.94 40 BT Group PLC 1.45% Universe(25%) -5.00 -0.51 5.64 14.77 7.61 Roche Holding AG 1.39% Universe(Median) -5.72 -1.83 4.15 13.49 6.36 Novo Nordisk A/S 1.38% 20 Universe(75%) -6.51 -3.27 2.11 11.93 5.26 Syngenta AG 1.38% Universe(95%) -8.26 -6.43 -0.65 9.80 3.07 Aryzta AG 1.35% 0 0 ARM Holdings PLC 1.34% Prospectus Exp Ratio Turnover Ratio Cp All PLC 1.31% City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 44 41

Quarterly Investment Monitor Data as of 09/30/2014 Oppenheimer International Growth Y Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 60 0 25 Total Return Rank, % 40 50 20 Total Return, % 75 0 100 -20 Oct-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Sep-14 -40 Up/Down Market Capture Ratio Oct-11 - Sep-14 225 -60 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 200 Up Mkt Capture Ratio, % 175 Oppenheimer International Growth Y MSCI EAFE Large Growth NR USD 150 Annual Return % 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 125 Oppenheimer International Growth Y 16.46 14.24 30.18 12.93 -41.22 38.44 15.35 -7.31 22.10 25.46 100 MSCI EAFE Large Growth NR USD 14.27 13.89 20.44 19.51 -41.74 28.81 11.48 -12.04 17.06 22.28 75 50 25 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 4 2 18 7 0 0 25 50 75 100 125 150 175 200 225 3 16 Down Mkt Capture Ratio, % 6 14 Excess Annualized StdDev, % 2 Morningstar Foreign Stock Universe Oppenheimer International Growth Y Total Annualized StdDev, % 5 12 MSCI EAFE Large Growth NR USD 1 Sharpe Ratio 4 Alpha, % 10 0 1 8 3 Return vs. Risk -1 6 2 Oct-11 - Sep-14 -2 25 4 -3 1 2 Total Annualized Return, % 20 -4 0 0 0 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 15 Oppenheimer International Growth Y MSCI EAFE Large Growth NR USD 10 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error Oppenheimer International Growth Y 1.63 0.96 92.64 1.07 13.68 3.74 5 MSCI EAFE Large Growth NR USD 0.00 1.00 100.00 0.99 13.65 0.00 Universe(5%) 3.70 1.09 96.14 1.21 16.01 6.44 0 0 5 10 15 20 25 30 Universe(25%) 1.32 1.04 94.70 1.05 14.65 4.68 Universe(Median) 0.19 0.99 92.91 0.96 14.06 3.82 Total Annualized StdDev, % Universe(75%) -1.11 0.95 90.67 0.87 13.45 3.23 Morningstar Foreign Stock Universe Oppenheimer International Growth Y Universe(95%) -3.30 0.86 83.63 0.72 12.28 2.76 Cash MSCI EAFE Large Growth NR USD City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 45 42

Quarterly Investment Monitor Data as of 09/30/2014 American Funds New Perspective R6 6.47 3.54 Portfolio Information Investment Strategy Summary % Cash Ticker RNPGX % US Stocks The investment seeks long-term growth of capital; future income is a secondary objective. Morningstar Category World Stock 41.45 % Bonds The fund seeks to take advantage of investment opportunities generated by changes in Avg Mkt Cap $MM 52954.87 % Non-US Stocks international trade patterns and economic and political relationships by investing in common Cat Med Mkt Cap $MM 39847.08 % Pref stocks of companies located around the world. In pursuing its primary investment objective, Net Assets $MM 57769.26 % Conv it invests primarily in common stocks that the investment adviser believes have the potential Turnover Ratio 30.00 for growth. In pursuing its secondary objective, the fund invests in common stocks of % Other % Assets in Top 10 Holdings 17.71 companies with the potential to pay dividends in the future. % Non-US Bonds Total Number of Holdings 286.00 Manager Name Gregg E. Ireland _________________________________________________________________________ 48.52 Manager Tenure 21.84 Fund Incept Date 03/13/1973 Prospectus Exp Ratio 0.45 Phone Number 800-421-4225 Performance vs. Peer Group Portfolio Region Portfolio Structure % United States 46.07 % Cash 6.47 25 % Canada 2.55 % US Stocks 41.45 % Latin America 0.31 % Bonds 0.02 % United Kingdom 9.02 % Non-US Stocks 48.52 20 % Eurozone 15.04 % Pref 0.00 Portfolio Ratings Total Annualized Return, % % Europe - ex Euro 11.85 % Conv 0.00 Mstar Rating % Europe - Emerging 0.00 % Other 3.54 3 Year Mstar Rating 15 % Africa 2.01 % Non-US Bonds 0.00 % Rank Cat 3 Yr 25 % Middle East 0.00 5 Year Mstar Rating % Japan 6.75 % Rank Cat 5 Yr 29 10 % Australasia 1.01 10 Year Mstar Rating % Asia - Developed 4.46 % Rank Cat 10 Yr 12 % Asia - Emerging 0.93 5 0 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group % Basic Materials 5.85 Avg Eff Duration NA 3 200 % Communication Services 2.48 Effective Maturity NA % Consumer Cyclical 18.05 Avg Credit Quality NA -5 180 % Consumer Defensive 12.28 AAA NA % Healthcare 14.53 AA NA 160 -10 % Industrials 12.68 A NA 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 0.00 BBB NA % Technology 14.68 BB NA 140 2 % Energy 4.86 B NA 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services 14.59 Below B NA 120 Median to 75th Percentile 75th to 95th Percentile % Utilities 0.00 NR/NA NA Ratio American Funds New Perspective R6 MSCI AC World Index ND USD 100 Turnover 3 Year to 1 3 5 Top Ten Holdings 80 Performance Months Date Year Years Years Novo Nordisk A/S 4.81% 1 American Funds New Perspective R6 -1.80 1.70 10.49 18.59 11.63 Amazon.com Inc 2.50% 60 MSCI AC World Index ND USD -2.30 3.73 11.32 16.61 10.07 Delta Air Lines Inc 1.44% Universe(5%) -0.01 8.13 15.99 21.34 13.52 Microsoft Corp 1.36% 40 Universe(25%) -1.92 4.16 12.07 19.16 11.86 Bayer AG 1.32% Universe(Median) -3.29 2.35 10.05 17.02 10.78 Home Depot Inc 1.32% 20 Universe(75%) -4.55 0.33 7.29 14.66 8.95 Naspers Ltd Class N 1.27% Universe(95%) -7.24 -3.29 4.36 5.73 5.32 Taiwan Semiconductor Manufacturing Co Ltd 1.27% 0 0 Associated Brit Foods 1.22% Prospectus Exp Ratio Turnover Ratio British American Tobacco PLC 1.19% City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 46 43

Quarterly Investment Monitor Data as of 09/30/2014 American Funds New Perspective R6 Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 60 0 25 Total Return Rank, % 40 50 20 Total Return, % 75 0 100 -20 Oct-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Sep-14 -40 Up/Down Market Capture Ratio Oct-11 - Sep-14 140 -60 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 120 Up Mkt Capture Ratio, % American Funds New Perspective R6 MSCI AC World Index ND USD 100 Annual Return % 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 80 American Funds New Perspective R6 14.27 11.28 19.87 16.03 -37.83 37.72 13.11 -7.33 21.19 27.23 60 MSCI AC World Index ND USD 15.23 10.84 20.95 11.66 -42.20 34.63 12.67 -7.35 16.13 22.80 40 20 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 6 2 16 10 0 0 25 50 75 100 125 150 175 200 225 250 4 9 14 Down Mkt Capture Ratio, % 8 2 Excess Annualized StdDev, % 12 Morningstar World Stock Universe American Funds New Perspective R6 Total Annualized StdDev, % 7 0 MSCI AC World Index ND USD 10 Sharpe Ratio 6 Alpha, % -2 1 8 5 -4 4 Return vs. Risk 6 -6 3 Oct-11 - Sep-14 4 25 -8 2 2 20 -10 1 Total Annualized Return, % 15 -12 0 0 0 10 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 5 American Funds New Perspective R6 MSCI AC World Index ND USD 0 -5 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr -10 Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error American Funds New Perspective R6 2.71 0.93 94.08 1.52 11.69 2.96 -15 MSCI AC World Index ND USD 0.00 1.00 100.00 1.33 12.14 0.00 -20 Universe(5%) 5.45 1.17 95.40 1.76 15.83 9.83 -25 0 5 10 15 20 25 30 Universe(25%) 2.72 1.07 92.70 1.47 14.00 5.74 Universe(Median) 0.83 0.98 88.27 1.32 12.75 4.63 Total Annualized StdDev, % Universe(75%) -1.15 0.90 81.08 1.15 11.69 3.68 Morningstar World Stock Universe American Funds New Perspective R6 Universe(95%) -10.56 0.62 55.81 0.44 9.05 2.65 Cash MSCI AC World Index ND USD City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 47 44

Quarterly Investment Monitor Data as of 09/30/2014 Vanguard Emerging Mkts Stock Idx I 2.43 Portfolio Information Investment Strategy Summary % Cash Ticker VEMIX % US Stocks The investment seeks to track the performance of a benchmark index that measures the Morningstar Category Diversified Emerging Mkts % Bonds investment return of stocks issued by companies located in emerging market countries. The Avg Mkt Cap $MM 20189.54 % Non-US Stocks fund employs an indexing investment approach by investing substantially all (approximately Cat Med Mkt Cap $MM 20391.64 % Pref 95%) of its assets in the common stocks included in the FTSE Emerging Index, while Net Assets $MM 64205.78 % Conv employing a form of sampling intended to reduce risk. The FTSE Emerging Index includes Turnover Ratio 26.00 approximately 851 common stocks of companies located in emerging markets around the % Other % Assets in Top 10 Holdings 13.86 world. % Non-US Bonds Total Number of Holdings 957.00 Manager Name Michael Perre _________________________________________________________________________ Manager Tenure 6.09 96.73 Fund Incept Date 05/04/1994 Prospectus Exp Ratio 0.12 Phone Number 800-662-7447 Performance vs. Peer Group Portfolio Region Portfolio Structure % United States 0.15 % Cash 0.50 12 % Canada 0.00 % US Stocks 0.15 % Latin America 21.22 % Bonds 0.00 10 % United Kingdom 0.00 % Non-US Stocks 96.73 % Eurozone 0.11 % Pref 2.43 Portfolio Ratings Total Annualized Return, % % Europe - ex Euro 0.03 % Conv 0.00 Mstar Rating 8 % Europe - Emerging 9.09 % Other 0.19 3 Year Mstar Rating % Africa 9.69 % Non-US Bonds 0.00 % Rank Cat 3 Yr 49 6 % Middle East 0.89 5 Year Mstar Rating % Japan 0.00 % Rank Cat 5 Yr 45 4 % Australasia 0.00 10 Year Mstar Rating % Asia - Developed 15.49 % Rank Cat 10 Yr 26 % Asia - Emerging 43.32 2 0 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group % Basic Materials 9.46 Avg Eff Duration NA 3 200 -2 % Communication Services 8.80 Effective Maturity NA % Consumer Cyclical 7.30 Avg Credit Quality NA 180 -4 % Consumer Defensive 8.41 AAA NA % Healthcare 2.14 AA NA 160 -6 % Industrials 5.01 A NA 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 2.71 BBB NA % Technology 14.76 BB NA 140 2 % Energy 10.57 B NA 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services 26.92 Below B NA 120 Median to 75th Percentile 75th to 95th Percentile % Utilities 3.93 NR/NA NA Ratio Vanguard Emerging Mkts Stock Idx I FTSE Emerging NR USD 100 Turnover 3 Year to 1 3 5 Top Ten Holdings 80 Performance Months Date Year Years Years Tencent Holdings Ltd. 2.02% 1 Vanguard Emerging Mkts Stock Idx I -2.43 4.51 6.19 7.77 4.38 China Mobile Ltd 1.76% 60 FTSE Emerging NR USD -2.34 4.87 6.50 7.23 4.55 Taiwan Semiconductor Manufacturing Co Ltd 1.51% Universe(5%) -1.71 6.85 10.13 11.75 8.27 China Construction Bank Corp H Shares 1.45% 40 Universe(25%) -3.08 3.68 6.22 9.09 5.45 Naspers Ltd Class N 1.35% Universe(Median) -3.77 2.14 4.65 7.76 4.41 Industrial And Commercial Bank Of China Ltd H Shares 1.29% 20 Universe(75%) -4.55 0.17 2.86 6.11 2.96 Taiwan Semiconductor Manufacturing Co Ltd ADR 1.19% Universe(95%) -5.84 -2.26 -0.09 3.44 0.23 Hon Hai Precision Ind Co Ltd 1.17% 0 0 Mtn Group Ltd 1.10% Prospectus Exp Ratio Turnover Ratio America Movil SAB de CV Class L 1.01% City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 48 45

Quarterly Investment Monitor Data as of 09/30/2014 Vanguard Emerging Mkts Stock Idx I Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 120 0 100 25 Total Return Rank, % 80 60 50 Total Return, % 40 75 20 0 100 -20 Oct-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Sep-14 -40 Up/Down Market Capture Ratio -60 Oct-11 - Sep-14 225 -80 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 200 Up Mkt Capture Ratio, % 175 Vanguard Emerging Mkts Stock Idx I FTSE Emerging NR USD 150 Annual Return % 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 125 Vanguard Emerging Mkts Stock Idx I 26.24 32.35 29.57 39.15 -52.74 76.35 19.06 -18.63 18.90 -4.99 100 FTSE Emerging NR USD 27.58 34.70 32.84 39.41 -53.03 82.15 19.60 -19.15 17.58 -3.79 75 50 25 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 6 0.8 22 8 0 0 25 50 75 100 125 150 175 200 225 5 20 0.7 7 Down Mkt Capture Ratio, % 4 18 Excess Annualized StdDev, % 0.6 6 Morningstar Emerging Markets Universe Vanguard Emerging Mkts Stock Idx I Total Annualized StdDev, % 16 3 FTSE Emerging NR USD 0.5 14 5 Sharpe Ratio 2 Alpha, % 12 1 0.4 4 10 0 Return vs. Risk 0.3 8 3 -1 Oct-11 - Sep-14 6 0.2 2 16 -2 4 0.1 1 14 -3 Total Annualized Return, % 2 -4 0.0 0 0 12 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 10 Vanguard Emerging Mkts Stock Idx I FTSE Emerging NR USD 8 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 6 Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error 4 Vanguard Emerging Mkts Stock Idx I 0.63 0.98 96.87 0.51 17.36 3.08 2 FTSE Emerging NR USD 0.00 1.00 100.00 0.48 17.35 0.00 Universe(5%) 5.36 1.12 96.78 0.79 20.56 7.56 0 0 5 10 15 20 25 30 35 40 Universe(25%) 2.52 0.98 94.91 0.62 17.40 5.68 Universe(Median) 0.81 0.95 92.54 0.52 16.96 4.85 Total Annualized StdDev, % Universe(75%) -1.01 0.87 90.23 0.41 15.94 4.04 Morningstar Emerging Markets Universe Vanguard Emerging Mkts Stock Idx I Universe(95%) -3.65 0.78 84.30 0.28 14.57 3.12 Cash FTSE Emerging NR USD City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 49 46

Quarterly Investment Monitor Data as of 09/30/2014 Vanguard REIT Index I Portfolio Information Investment Strategy Summary % Cash Ticker VGSNX % US Stocks The investment seeks to provide a high level of income and moderate long-term capital Morningstar Category Real Estate % Bonds appreciation by tracking the performance of a benchmark index that measures the Avg Mkt Cap $MM 9007.48 % Non-US Stocks performance of publicly traded equity REITs. The fund employs an indexing investment Cat Med Mkt Cap $MM 11724.89 % Pref approach designed to track the performance of the MSCI U.S. REIT Index. The index is Net Assets $MM 43099.65 % Conv composed of stocks of publicly traded equity real estate investment trusts (known as REITs). Turnover Ratio 11.00 The fund attempts to replicate the index by investing all, or substantially all, of its assets in % Other % Assets in Top 10 Holdings 38.00 the stocks that make up the index, holding each stock in approximately the same proportion % Non-US Bonds Total Number of Holdings 139.00 as its weighting in the index. Manager Name Gerard C. O'Reilly Manager Tenure 18.39 _________________________________________________________________________ 99.95 Fund Incept Date 05/13/1996 Prospectus Exp Ratio 0.08 Phone Number 800-662-7447 Performance vs. Peer Group Portfolio Region Portfolio Structure % United States 100.00 % Cash 0.05 20 % Canada 0.00 % US Stocks 99.95 % Latin America 0.00 % Bonds 0.00 % United Kingdom 0.00 % Non-US Stocks 0.00 % Eurozone 0.00 % Pref 0.00 Portfolio Ratings 15 Total Annualized Return, % % Europe - ex Euro 0.00 % Conv 0.00 Mstar Rating % Europe - Emerging 0.00 % Other 0.00 3 Year Mstar Rating % Africa 0.00 % Non-US Bonds 0.00 % Rank Cat 3 Yr 19 % Middle East 0.00 5 Year Mstar Rating 10 % Japan 0.00 % Rank Cat 5 Yr 12 % Australasia 0.00 10 Year Mstar Rating % Asia - Developed 0.00 % Rank Cat 10 Yr 28 % Asia - Emerging 0.00 5 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group % Basic Materials 0.00 Avg Eff Duration NA 2 180 0 % Communication Services 0.00 Effective Maturity NA % Consumer Cyclical 0.00 Avg Credit Quality NA 160 % Consumer Defensive 0.00 AAA NA % Healthcare 0.00 AA NA % Industrials 0.00 A NA 140 -5 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 100.00 BBB NA % Technology 0.00 BB NA 120 % Energy 0.00 B NA 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services 0.00 Below B NA Median to 75th Percentile 75th to 95th Percentile % Utilities 0.00 NR/NA NA Ratio 100 Vanguard REIT Index I MSCI US REIT NR USD 1 Turnover 80 3 Year to 1 3 5 Top Ten Holdings Performance Months Date Year Years Years Simon Property Group Inc 8.43% 60 Vanguard REIT Index I -3.12 13.99 13.21 16.57 15.94 Public Storage 4.10% MSCI US REIT NR USD -3.38 13.04 11.90 15.28 14.62 Equity Residential 3.64% Universe(5%) -1.89 15.08 15.04 18.11 16.75 40 Health Care REIT, Inc. 3.31% Universe(25%) -2.82 14.12 14.10 16.52 15.81 Prologis Inc 3.26% Universe(Median) -3.07 13.59 13.25 15.95 15.35 AvalonBay Communities Inc 3.19% 20 Universe(75%) -3.34 12.89 12.50 15.50 14.74 HCP Inc 3.17% Universe(95%) -3.83 7.75 9.21 14.06 11.91 Ventas Inc 3.09% 0 0 Boston Properties Inc 2.96% Prospectus Exp Ratio Turnover Ratio Vornado Realty Trust 2.85% City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 50 47

Quarterly Investment Monitor Data as of 09/30/2014 Vanguard REIT Index I Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 50 0 40 25 Total Return Rank, % 30 20 50 Total Return, % 10 75 0 -10 100 -20 Oct-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Sep-14 -30 Up/Down Market Capture Ratio -40 Oct-11 - Sep-14 140 -50 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 120 Up Mkt Capture Ratio, % Vanguard REIT Index I MSCI US REIT NR USD 100 Annual Return % 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 80 Vanguard REIT Index I 30.93 12.05 35.15 -16.38 -36.95 29.76 28.56 8.70 17.65 2.48 60 MSCI US REIT NR USD NA NA 34.18 -17.84 -39.05 26.27 26.97 7.48 16.47 1.26 40 20 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 6 2 16 9 0 -20 0 20 40 60 80 100 120 140 14 8 Down Mkt Capture Ratio, % 5 7 Excess Annualized StdDev, % 12 Morningstar Real Estate Universe Vanguard REIT Index I Total Annualized StdDev, % 4 6 MSCI US REIT NR USD 10 Sharpe Ratio 3 Alpha, % 5 1 8 4 2 Return vs. Risk 6 3 1 Oct-11 - Sep-14 4 35 2 0 2 1 30 Total Annualized Return, % -1 0 0 0 25 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 20 Vanguard REIT Index I MSCI US REIT NR USD 15 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error 10 Vanguard REIT Index I 1.15 1.00 99.98 1.10 14.88 0.22 5 MSCI US REIT NR USD 0.00 1.00 100.00 1.03 14.90 0.00 Universe(5%) 5.75 1.02 99.69 1.54 15.30 8.09 0 0 2 4 6 8 10 12 14 16 18 20 22 Universe(25%) 1.77 1.00 99.38 1.14 14.89 2.55 Universe(Median) 0.90 0.97 98.87 1.08 14.57 1.66 Total Annualized StdDev, % Universe(75%) 0.47 0.93 97.34 1.05 14.15 1.20 Morningstar Real Estate Universe Vanguard REIT Index I Universe(95%) -0.16 0.64 75.38 0.99 12.85 0.94 Cash MSCI US REIT NR USD City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 51 48

Quarterly Investment Monitor Data as of 09/30/2014 Glossary Alpha (3 Yr) % Assets in Top 10 Holdings Alpha is a measure of the difference between a portfolio’s actual returns and its expected performance, given its level of risk as The aggregate assets, expressed as a percentage, of the fund's top 10 portfolio holdings. This figure is meant to be a measure of portfolio measured by beta. A positive alpha figure indicates the portfolio has performed better than its beta would predict. In contrast, a negative risk. Specifically, the higher the percentage, the more concentrated the fund is in a few companies or issues, and the more the fund is alpha indicates the portfolio has underperformed, given the expectations established by beta. susceptible to the market fluctuations in these few holdings. The figure is calculated from the most recent available fund holdings. Average Effective Duration Price/Book Ratio TTM A measure of a fund's interest-rate sensitivity--the longer a fund's duration, the more sensitive the fund is to shifts in interest rates. The weighted average of the price/book ratios of all the stocks in a fund’s portfolio. The P/B ratio of a company is calculated by dividing the Duration is determined by a formula that includes coupon rates and bond maturities. Small coupons tend to increase duration, while market price of its stock by the company’s per-share book value. Stocks with negative book values are excluded from this calculation. In shorter maturities and higher coupons shorten duration. The relationship between funds with different durations is straightforward: A theory, a high P/B ratio indicates that the price of the stock exceeds the actual worth of the company's assets, while a low P/B ratio indicates fund with a duration of 10 years is twice as volatile as a fund with a five-year duration. Morningstar prints an average effective duration that the stock is a bargain. statistic that incorporates call, put, and prepayment possibilities. Price/Earnings Ratio TTM Average Effective Maturity The weighted average of the price/earnings ratios of the stocks in a fund’s portfolio. The P/E ratio of a stock is calculated by dividing the Average effective maturity is a weighted average of all the effective maturities of the bonds in a portfolio. Effective maturity takes into current price of the stock by its trailing 12 months’ earnings per share. In computing the average, Morningstar weights each portfolio holding consideration mortgage prepayments, puts, calls, adjustable coupons, and other features of individual bonds and is thus a more by the percentage of equity assets it represents, so that larger positions have proportionately greater influence on the fund’s final P/E. accurate measure of interest-rate sensitivity. Longer-maturity funds are generally considered more interest-rate sensitive than their shorter counterparts. R-Squared Beta Reflects the percentage of a fund’s movements that can be explained by movements in its benchmark index. An R-squared of 100 indicates that all movements of a fund can be explained by movements in the index. Thus, index funds that invest only in S&P 500 stocks will have an A measure of a fund’s sensitivity to market movements. The beta of the market is 1.00 by definition. Morningstar calculates beta by R-squared very close to 100. Conversely, a low R-squared indicates that very few of the fund’s movements can be explained by movements comparing a fund’s excess return over Treasury bills to the market's excess return over Treasury bills, so a beta of 1.10 shows that the in its benchmark index. An R-squared measure of 35, for example, means that only 35% of the fund’s movements can be explained by fund has performed 10% better than its benchmark index in up markets and 10% worse in down markets, assuming all other factors movements in the benchmark index. remain constant. Conversely, a beta of 0.85 indicates that the fund’s excess return is expected to perform 15% worse than the market’s excess return during up markets and 15% better during down markets. Sharpe Ratio The Morningstar Rating The Sharpe Ratio is a risk-adjusted measure developed by Nobel Laureate William Sharpe. It is calculated by using standard deviation and excess return to determine reward per unit of risk. The higher the Sharpe Ratio, the better the portfolio’s historical risk-adjusted Commonly called the Star Rating, is a measure of a fund's risk-adjusted return, relative to funds in its category. Funds are rated from performance. It can be used to compare two portfolios directly on how much excess return each portfolio achieved for a certain level of risk. one to five stars, with the best performers receiving five stars and the worst performers receiving a single star. Standard Deviation Risk-adjusted return is calculated by subtracting a risk penalty from each fund total return, after accounting for all loads, sales charges, and redemption fees. The risk penalty is determined by the amount of variation in the fund's monthly return, with emphasis on Standard deviation is the statistical measurement of dispersion about an average, which depicts how widely a stock or portfolio’s returns downward variation. The greater the variation, the larger the penalty. Funds are ranked within their categories and stars are assigned as varied over a certain period of time. Investors use the standard deviation of historical performance to try to predict the range of returns that is follows: Top 10% five stars; Next 22.5% four stars; Middle 35% three stars; Next 22.5% two stars; Bottom 10% one star. most likely for a given investment. When a stock or portfolio has a high standard deviation, the predicted range of performance is wide, implying greater volatility. Audited Expense Ratio Total Number of Holdings The percentage of fund assets paid for operating expenses and management fees, including 12b-1 fees, administrative fees, and all other asset-based costs incurred by the fund, except brokerage costs. Fund expenses are reflected in the fund’s NAV . Sales charges The total number of different holdings of a fund. This figure is meant to be a measure of portfolio risk. Specifically, the lower the figure, the are not included in the expense ratio. more concentrated the fund is in a few companies or issues, and the more the fund is susceptible to the market fluctuations in these few holdings. This figure also provides a context for the importance of % assets in top 10 holdings. The figure is calculated from the most recent Geometric Average Market Capitalization available fund holdings. It does not include a fund’s short positions. Morningstar defines the overall "size" of a stock fund's portfolio as the geometric mean of the market capitalization for all of the stocks it Total Return owns. It's calculated by raising the market capitalization of each stock to a power equal to that stock's stake in the portfolio. The resulting numbers are multiplied together to produce the geometric mean of the market caps of the stocks in the portfolio, which is Expressed in percentage terms, Morningstar’s calculation of total return is determined each month by taking the change in monthly net reported as average market capitalization. asset value, reinvesting all income and capital-gains distributions during that month, and dividing by the starting NAV. Reinvestments are This number is different from the fund's median market cap--the capitalization of the median stock in its portfolio. The geometric mean made using the actual reinvestment NAV, and daily payoffs are reinvested monthly. better identifies the portfolio's "center of gravity." That is, it provides more accurate insight into how market trends (as defined by capitalization) might affect the portfolio. Turnover Ratio Net Assets This is a measure of the fund’s trading activity which is computed by taking the lesser of purchases or sales (excluding all securities with maturities of less than one year) and dividing by average monthly net assets. A turnover ratio of 100% or more does not necessarily suggest The month-end net assets of the mutual fund, recorded in millions of dollars. Net-asset figures are useful in gauging a fund’s size, that all securities in the portfolio have been traded. In practical terms, the resulting percentage loosely represents the percentage of the agility, and popularity. They help determine whether a small company fund, for example, can remain in its investment-objective portfolio’s holdings that have changed over the past year. category if its asset base reaches an ungainly size. 12-Month Yield Also known as a distribution yield, Morningstar computes this figure by summing the trailing 12-month’s income distributions and dividing the sum by the last month’s ending NAV, plus any capital gains distributed over the same period. Income refers only to interest payments from fixed-income securities and dividend payoffs from common stocks. City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 52 49

Quarterly Investment Monitor Data as of 09/30/2014 Disclaimer This Milliman work product was prepared solely for the internal business use of City of Dover, Delaware Police Pension Plan. Milliman's work may not be provided to third parties without Milliman's prior written consent. The analysis in this report was prepared utilizing data from third parties and other sources including but not limited to internal computer software and databases. Reasonable care has been taken to assure the accuracy of the data contained herein, and comments are objectively stated and are based on facts gathered in good faith. These reports do not constitute investment advice with respect to the sale or disposition of individual securities. Unless explicitly stated in your Service Agreement, there should be no reliance on Milliman services to provide analysis or reporting on a daily basis, the changes to manager rankings, ratings or opinions thereon and are not intended to monitor investment manager compliance with individual security selection criteria, limits on security selection, and/or prohibitions to the holding of certain securities or security types. The One Year, Three Year, Five Year, and Ten Year rates of return are time-weighted annual rates. The One Month, Three Month, and Year to Date rates of return are rates for the period indicated. All returns include fund internal expenses, except sales charges, if any. The rates of return shown are for the mutual funds in which the retirement program participates, not for the plan specifically. Returns credited to individual accounts will vary due to the timing of contributions, transfers, and withdrawals. Past performance is no guarantee of future results. Milliman provides a copy of its SEC Form ADV Part II to clients without charge upon request. Milliman disclaims responsibility, financial or otherwise, for the accuracy or completeness of this report. City of Dover, Delaware Police Pension Plan DOCUMENT PAGE 53 50

Albany Dallas San Francisco Walnut Creek http://us.milliman.com/solutions/investment Memorandum October 14, 2014 To: Clients From: Milliman Investment Consulting Subject: Update on PIMCO Total Return Milliman Recommends Reviewing Alternatives for PIMCO Total Return and PIMCO Low Duration and Related Strategies The surprising high level change at one of the largest investment management firms in the country demands the attention of our clients, plan fiduciaries and Milliman as your Investment Advisor. Any action (or inaction) requires thoughtful consideration of the facts as they develop. Over the short- term, we think the team in place at PIMCO and the fund liquidity they have constructed will be adequate to produce attractive risk and return. Over the longer term, we think clients would be prudent to consider their options in the intermediate fixed income asset class and each client will need to decide if PIMCO remains a prudent choice. Milliman will continue to conduct due diligence on PIMCO. In addition to frequent contact with PIMCO via email and phone calls, we will be conducting an additional on-site visit with PIMCO in mid-October. Overview On Friday, September 26, 2014, Bill Gross left the firm he founded, Pacific Investment Management Company, LLC (PIMCO) to run a bond fund at Janus Capital Group. The friction between Bill Gross and former PIMCO employees is well documented. In hindsight, it may seem clear that Bill Gross was the last piece of a dysfunctional, organizational challenge that needed to be addressed. However, the departure of the firm’s founder came as quite a shock to us and the investment community. Later that day, PIMCO CEO Doug Hodge expressed gratitude for the contributions Gross provided to the firm over the years, as expected, but expressed that the firm leadership had fundamental differences regarding the best way for PIMCO to move forward. Personnel Changes In March 2014, Mohamed El-Erian, Chief Executive Officer (CEO) and co-CIO with Gross, suddenly departed PIMCO. The reason given at the time was so he could spend more time with his family, though later it appeared he and Gross were having trouble continuing to work together. Based on 1

Milliman Investment Consulting Memo October 14, 2014 Gross’ age and El-Erian’s exit, PIMCO leadership announced a succession plan and changes to the organizational structure, creating a Deputy CIO structure. This new structure included six managers in the role of deputy CIO under Gross: Dan Ivascyn, Scott Mather, Mark Kiesel, Mihir Worah, Andrew Balls, and Virginie Maisonnueve. Doug Hodge was named CEO and Jay Jacobs was named President. Paul McCulley also returned to PIMCO as the firm’s Chief Economist, an addition we viewed favorably. Now, with Gross’ departure, Dan Ivascyn will be Group CIO. The remaining five deputy CIOs were promoted to CIO. These CIOs mange 75% of the firm’s assets. The Portfolio Managers for the Total Return strategy (and related strategies such as Harbor Bond) will be Scott Mather, Mark Kiesel, and Mihir Worah. These three managers have been working together for more than a decade. As Group CIO, Mr. Ivascyn continues to oversee the firm’s mortgage, credit, alternatives and income strategies. He was a Morningstar Fixed Income Manager of the Year in 2013 for the PIMCO Income fund. Mark Kiesel was a Morningstar Manager of the year in 2012. The Portfolio Managers for the Low Duration strategy fund will be Scott Mather and Jerome Schneider, head of PIMCO’s short-term and funding desk. As we understand it, Gross is not building out the same team or structure at his new home, Janus. This and non-compete agreements (as they are structured in California) make it unlikely we’ll see talent migrate to Janus. Organizational Changes With regard to PIMCO as a firm, this could be viewed as a positive. This new structure removes the uncertainty of what the firm would look like when the 70 year old Gross retired or was no longer a Portfolio Manager. The firm has a well-established process of structuring investment decisions within the context of their secular forums for top-down macro views, and using the sector specialist for the individual security selection. This process will continue with, as PIMCO calls it, “more rigor.” In our analysis and through our discussions with PIMCO, it appears Gross’ process operated differently than the rest of the firm and in some respects, outside of this formalized and team structure. This may have contributed to employee dissatisfaction and perhaps recent underperformance. Current Environment PIMCO is a leading investment firm with a deep bench of intelligent and successful investment professionals with a long track record of top notch performance at Total Return and many other investment strategies. The teams now in place have the skill and tools to produce an attractive investment return. However they have a number of challenges to face. Cash flow Including September, the Total Return fund has seen 17 straight months of outflows. Low Duration has also seen steady outflows. Some of this can be explained by investors (broadly across the markets) selling bonds and some of these outflows are likely the result of El-Erian’s departure. It’s no surprise there was significant cash outflow following Gross’ departure. Each day brings new PIMCO clients announcing their intentions. Some have already replaced PIMCO and some say they will do so in the near future. Other large plans have reiterated their commitment to PIMCO and the ongoing team. We are monitoring cash flows as closely as we can (mutual fund data is reported monthly, ETFs are reported daily) and so far, Gross’ new fund at Janus has not attracted much of the cash outflow from Total Return. 2

Milliman Investment Consulting Memo October 14, 2014 We believe the PIMCO funds are prepared for this liquidity PIMCO Total Return Cash Flow Comparison crunch, at least over the Fund Level Intermediate‐Term Bond short term. As we mentioned in a prior memo, the funds 10.0 Billions are made up of thousands of 5.0 highly liquid investments as 0.0 well as derivatives that trade ‐5.0 ‐10.0 in significant volumes. ‐15.0 Selling an open-ended ‐20.0 mutual fund is not the same ‐25.0 as selling an individual ‐30.0 security and thus, market impact and cash flows must be viewed in the appropriate light. What is not yet clear is how long these outflows will last and what impact they might have on performance months down the road. Personnel A smaller asset base will mean lower fee revenue and may impact the firm’s resources and the ability to compensate some managers. PIMCO has stated they have retention incentives in place to combat personnel departures. Time will tell if these are meaningful enough. However the team structure put in place at the beginning of the year should now be fully implemented. If Gross was difficult to work with, as some ex-employees and the press have suggested, the new environment should be a positive change. However, Gross’ departure could lead to other changes among portfolio management professionals not related to fees and compensation which are hard to anticipate such as those who may find PIMCO less attractive as a firm without Gross. Performance While the long track record at PIMCO is very attractive, short-term performance has been disappointing. As of the end of last quarter, Total Return was in the 79th percentile of its peer group, lagging the median manager by 76 basis points and the BC Aggregate Bond Index by 77 basis points, net of fees. However, over the last three years, Total Return is in the top 20%, outperforming the median manager by 120 basis points and the BC Aggregate Bond Index by 214 basis points. As of this writing, the relative performance over the very short, 1-week time frame, Total Return is in the top 30%. Recommendations PIMCO is a substantial firm with significant resources and an extremely deep bench of analysts, portfolio managers and other professionals. The new portfolio managers replacing Gross have been very successful and fit well in the team structure. The fund’s liquidity is well positioned for the expected negative cash flows over the near term. The firm’s strategy of macro views and sector teams’ security selection has been working for years and their long-term track record is among the industry’s best. However, the expected loss of assets and possibly personnel demand increased scrutiny of PIMCO and an evaluation of potential candidates for our clients’ fixed income assets. 3

Asset Allocation Study City of Dover, Delaware Police Pension Plan Asset Allocation Study Date Prepared: July 2014 For Additional Information Contact: Investment Consultant Investment Consultant ® Kevin Abessi, MBA Jeff Marzinsky, CPC, CIMA (646) 473-3321 (518) 514-7100 kevin.abessi@milliman.com jeff.marzinsky@milliman.com DOCUMENT PAGE 54

Quarterly Investment Monitor - June 2014 Asset Allocation Study Optimization Input Review Expected Annual Return Annual Standard Deviation Sharpe Ratio Cash 2.50% 1.25 0.00 Short Bonds 2.25% 2.35 -0.11 Long Bonds 2.90% 9.45 0.04 Interm Bonds 2.35% 3.90 -0.04 Inflation-Indexed Bonds 2.10% 4.40 -0.09 High Yield 6.50% 11.05 0.36 US Large Growth 8.90% 21.20 0.30 US Large Value 8.05% 17.70 0.31 US Small Value 8.40% 21.75 0.27 US MidCap Value 8.15% 19.45 0.29 Foreign Developed Equity 8.85% 21.30 0.30 Emerging Markets Equity 11.00% 30.05 0.28 US REITs 8.00% 22.30 0.25 DOCUMENT PAGE 55 2

Quarterly Investment Monitor - June 2014 Asset Allocation Study Input Correlation Corr Corr Corr Corr Corr Corr Corr with Corr Corr Corr Corr Corr Corr with with with with with with ML with with with with with with US US US US Foreign Emerging US Long IntermInflation-Indexed High US Cash Large Large Small MidCap Developed Markets Treas Bonds Bonds Bonds Yield REITs Growth Value Value Value Equity Equity Infl-Linked Cash 1.00 0.55 0.02 0.26 0.02 -0.12 0.03 0.03 -0.05 -0.04 -0.10 -0.11 -0.08 Short Bonds 0.55 1.00 0.60 0.91 0.48 -0.01 -0.15 -0.09 -0.16 -0.12 -0.14 -0.23 -0.02 Long Bonds 0.02 0.60 1.00 0.85 0.56 -0.01 -0.15 -0.08 -0.14 -0.10 -0.09 -0.25 0.03 Interm Bonds 0.26 0.91 0.85 1.00 0.63 0.03 -0.18 -0.09 -0.17 -0.11 -0.11 -0.25 0.03 Inflation-Indexed Bonds 0.02 0.48 0.56 0.63 1.00 0.03 -0.25 -0.21 -0.23 -0.18 -0.20 -0.16 0.05 High Yield -0.12 -0.01 -0.01 0.03 0.03 1.00 0.64 0.69 0.66 0.73 0.61 0.65 0.64 US Large Growth 0.03 -0.15 -0.15 -0.18 -0.25 0.64 1.00 0.80 0.66 0.75 0.78 0.69 0.46 US Large Value 0.03 -0.09 -0.08 -0.09 -0.21 0.69 0.80 1.00 0.90 0.97 0.81 0.63 0.74 US Small Value -0.05 -0.16 -0.14 -0.17 -0.23 0.66 0.66 0.90 1.00 0.94 0.68 0.64 0.81 US MidCap Value -0.04 -0.12 -0.10 -0.11 -0.18 0.73 0.75 0.97 0.94 1.00 0.78 0.65 0.79 Foreign Developed Equity -0.10 -0.14 -0.09 -0.11 -0.20 0.61 0.78 0.81 0.68 0.78 1.00 0.71 0.57 Emerging Markets Equity -0.11 -0.23 -0.25 -0.25 -0.16 0.65 0.69 0.63 0.64 0.65 0.71 1.00 0.44 US REITs -0.08 -0.02 0.03 0.03 0.05 0.64 0.46 0.74 0.81 0.79 0.57 0.44 1.00 DOCUMENT PAGE 56 3

Quarterly Investment Monitor - June 2014 Asset Allocation Study Individual Constraints Groups & Constraints, Updated Frontier Min, Max, % % Cash 2.00 5.00 Short Bonds 2.00 15.00 Long Bonds 2.00 9.00 Interm Bonds 2.00 15.00 Inflation-Indexed Bonds 2.00 15.00 High Yield 2.00 7.00 US Large Growth 5.00 20.00 US Large Value 5.00 20.00 US Small Value 5.00 20.00 US MidCap Value 5.00 20.00 Foreign Developed Equity 5.00 20.00 Emerging Markets Equity 5.00 12.00 US REITs 1.00 20.00 Group Constraints Groups & Constraints, Updated Frontier Fixed Income Cash 1.00 Short Bonds 1.00 Long Bonds 1.00 Interm Bonds 1.00 Inflation-Indexed Bonds 1.00 High Yield 1.00 Min, % 20.00 Max, % 50.00 DOCUMENT PAGE 57 4

Quarterly Investment Monitor - June 2014 Asset Allocation Study Portfolio Options Sample Sample Sample Current Portfolios: Portfolios: Portfolios: Portfolio Updated Frontier Updated Frontier Updated Frontier Allocation resampled 1 resampled 2 resampled 3 Cash 3.6 3.3 3.0 4.5 Short Bonds 4.5 3.0 2.0 5.5 Long Bonds 7.3 7.3 4.0 9.0 Interm Bonds 5.9 2.7 2.0 8.0 Inflation-Indexed Bonds 4.7 3.1 2.1 5.0 High Yield 6.7 6.7 6.9 8.0 US Large Growth 14.4 15.3 15.9 10.0 US Large Value 10.6 12.1 9.2 10.0 US Small Value 6.8 7.6 11.5 8.0 US MidCap Value 6.2 6.8 8.6 5.0 Foreign Developed Equity 12.2 13.5 15.1 10.0 Emerging Markets Equity 8.9 9.4 11.2 10.0 US REITs 8.3 9.3 8.5 7.0 Fixed Income 32.7% 26.1% 20.0% 40.0% Equity 67.4% 74.0% 80.0% 60.0% Sample Portfolios: Updated Frontier resampled 1 Sample Portfolios: Updated Frontier resampled 2 Sample Portfolios: Updated Frontier resampled 3 Current Portfolio Allocation Expected Return 7.00% 7.42% 7.85% 6.63% Expected Standard Deviation 13.152 14.405 15.781 12.015 Expected Sharpe Ratio 0.342 0.342 0.339 0.344 Sample Portfolios: Updated Frontier resampled 1 Sample Portfolios: Updated Frontier resampled 3 Sample Portfolios: Updated Frontier resampled 2 Current Portfolio Allocation Expected Return Expected Sharpe Ratio 8 Expected Risk 0.50 16 14 Expected Sharpe Ratio 6 12 Expected Return Expected Risk 10 4 8 0.25 6 2 4 2 0 0 0.00 DOCUMENT PAGE 58 5

Quarterly Investment Monitor - June 2014 Asset Allocation Study Efficient Frontier Mean/Variance Efficient Frontier (Milliman Capital Market Assumptions) 12.0 11.5 11.0 10.5 10.0 9.5 9.0 8.5 8.0 7.5 7.0 Return, % 6.5 6.0 5.5 5.0 4.5 4.0 3.5 3.0 2.5 2.0 1.5 1.0 0.5 0.0 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 Risk (StDev Rtn), % Unconstrained resampled Updated Frontier resampled Sample Portfolios: Updated Frontier resampled Current Portfolio Allocation Cash Short Bonds Long Bonds Interm Bonds Inflation-Indexed Bonds High Yield US Large Growth US Large Value US Small Value US MidCap Value Foreign Developed Equity Emerging Markets Equity US REITs DOCUMENT PAGE 59 6

Quarterly Investment Monitor - June 2014 Asset Allocation Study Monte Carlo Simulation Return Summary Sample Sample Sample Portfolios: Portfolios: Portfolios: Current Updated Updated Updated Portfolio Frontier Frontier Frontier Allocation resampled 1 resampled 2 resampled 3 5th 50th 95th 5th 50th 95th 5th 50th 95th 5th 50th 95th Percentile Percentile Percentile Percentile Percentile Percentile Percentile Percentile Percentile Percentile Percentile Percentile Jul 14 - Dec 14 -12.99 6.88 28.14 -14.41 7.27 30.55 -15.49 7.70 32.91 -11.56 6.60 25.89 Jul 14 - Dec 15 -10.18 6.74 24.06 -11.36 7.09 26.09 -12.35 7.46 28.01 -9.05 6.45 22.10 Jul 14 - Dec 16 -7.03 6.64 19.74 -7.94 6.96 21.33 -8.75 7.33 22.83 -6.13 6.34 18.21 Jul 14 - Dec 17 -5.26 6.62 17.56 -6.04 6.93 18.92 -6.70 7.29 20.22 -4.46 6.34 16.26 Jul 14 - Dec 18 -4.00 6.52 16.25 -4.72 6.82 17.50 -5.33 7.13 18.66 -3.32 6.25 15.06 Jul 14 - Dec 19 -3.11 6.43 15.28 -3.75 6.74 16.47 -4.28 7.03 17.56 -2.47 6.17 14.22 Jul 14 - Dec 20 -2.45 6.43 14.55 -3.02 6.74 15.65 -3.49 7.04 16.71 -1.89 6.16 13.55 Jul 14 - Dec 21 -1.93 6.39 13.96 -2.46 6.69 14.95 -2.95 6.98 15.96 -1.44 6.13 13.01 Jul 14 - Dec 22 -1.51 6.36 13.45 -2.01 6.66 14.40 -2.40 6.93 15.36 -1.06 6.09 12.56 Jul 14 - Dec 23 -1.09 6.37 13.12 -1.53 6.67 14.04 -1.88 6.96 14.95 -0.67 6.09 12.27 DOCUMENT PAGE 60 7

Quarterly Investment Monitor - June 2014 Asset Allocation Study Monte Carlo Simulation Monte Carlo Annual Return Simulation Sample Portfolios: Updated Frontier resampled 1 Sample Portfolios: Updated Frontier resampled 2 Sample Portfolios: Updated Frontier resampled 3 Current Portfolio Allocation 75th to 95th Percentile 35 50th to 75th Percentile 25th to 50th Percentile 5th to 25th Percentile 30 Average 25 20 Annual Return, % 15 10 5 0 -5 -10 -15 -20 Dec 2014 Dec 2015 Dec 2016 Dec 2017 Dec 2018 Dec 2019 Dec 2020 Dec 2021 Dec 2022 Dec 2023 Dec Dec 2015 Dec 2016 Dec 2017 Dec 2018 Dec 2019 Dec 2020 Dec 2021 Dec 2022 Dec Dec 2023 Dec 2015 Dec 2016 Dec 2017 Dec 2018 Dec 2019 Dec 2020 Dec 2021 Dec 2022 Dec 2023 Dec 2014 2014 2014 Dec 2015 Dec 2016 Dec 2017 Dec 2018 Dec 2019 Dec 2020 Dec 2021 Dec 2022 Dec 2023 Monte-Carlo Downside Log-stable Simulations DOCUMENT PAGE 61 8

Quarterly Investment Monitor - June 2014 Asset Allocation Study Monte Carlo Simulation Probability Returns Above 7.50% 55 Sample Portfolios: Updated Frontier resampled 1 50 Sample Portfolios: Updated Frontier resampled 2 Sample Portfolios: Updated Frontier resampled 3 45 Current Portfolio Allocation 40 35 Probability, % 30 25 20 15 10 5 0 Dec 2014 Dec 2016 Dec 2018 Dec 2020 Dec 2022 Dec 2024 Monte-Carlo Downside Log-stable Simulations Sample Portfolios: Updated Sample Portfolios: Updated Sample Portfolios: Updated Current Portfolio Frontier resampled 1 Frontier resampled 2 Frontier resampled 3 Allocation Target Pr (Ann Rtn) Target Pr (Ann Rtn) Target Pr (Ann Rtn) Target Pr (Ann Rtn) (Simul DLS), % (Simul DLS), % (Simul DLS), % (Simul DLS), % Jul-14 - Dec-14 47.91 49.26 50.59 46.67 Jul-14 - Dec-15 47.20 48.76 50.26 45.52 Jul-14 - Dec-16 45.93 47.74 49.37 43.66 Jul-14 - Dec-17 44.68 47.09 49.08 42.32 Jul-14 - Dec-18 43.37 45.94 48.06 40.68 Jul-14 - Dec-19 42.10 44.79 47.05 39.10 Jul-14 - Dec-20 41.33 44.29 46.70 38.21 Jul-14 - Dec-21 40.58 43.61 46.16 37.19 Jul-14 - Dec-22 39.76 42.92 45.62 36.25 Jul-14 - Dec-23 39.28 42.73 45.63 35.49 Jul-14 - Dec-24 38.53 42.19 45.30 34.80 DOCUMENT PAGE 62 9

Quarterly Investment Monitor - June 2014 Asset Allocation Study Definitions Expected Return - the expected value, or arithmatic average (mean), of all the likely returns of investments comprising a portfolio. Although this is what you expect the return to be, there is no guarantee that it will be the actual return. Modern Portfolio Theory (MPT) - Proposes how rational investors will use diversification to optimize their portfolios, and how an asset should be priced given its risk relative to the market as a whole. MPT models the return of an asset as a random variable and a portfolio as a weighted combination of assets; the return of a portfolio is thus also a random variable and consequently has an expected value and a variance. Risk in this model is identified with the standard deviation of portfolio return. Rationality is modeled by supposing that an investor choosing between several portfolios with identical expected returns, will prefer that portfolio which minimizes risk. Monte Carlo Simulation - A method in which a computer program is used to represent the operation of a large complex financial system to find an approximate solution. The simulation generates a very large number of "trials" (10,000) and chooses values from a probablility distribution given certain characteristics including mean and standard deviation. Sharpe Ratio - The Sharpe Ratio is the quotient of the annualized excess return of the manager over the cash equivalent and the annualized standard deviation of the manager return. The higher the Sharpe Ratio, the better the portfolio’s historical risk-adjusted performance. It can be used to compare two portfolios directly based on how much excess return each portfolio achieved for a certain level of risk. Standard Deviation - A statistical measurement of dispersion about an average, which depicts how widely an investment's returns varied over a certain period of time. Investors use the standard deviation of historical performance to try to predict the range of returns that is most likely for a given investment. When an investment has a high standard deviation, the predicted range of performance is wide, implying greater volatility. DOCUMENT PAGE 63 10

Quarterly Investment Monitor - June 2014 Asset Allocation Study Disclaimer This report has been prepared for the internal use of City of Dover, Delaware Police Pension Plan and is only to be relied upon by City of Dover, Delaware Police Pension Plan No portion of this report may be distributed or otherwise furnished to any other party without Milliman's prior written consent. In the event such consent is given, the report must be provided in its entirety. Milliman does not intend to benefit any third party recipient of its work product and does not intend to create any legal duty from Milliman to any other party even if Milliman's work product is so distributed. Information on individual investment managers and plan investment options contained in this report have been obtained from the firms themselves or a third party vendor. Although Milliman did not perform a detailed audit of the information provided, we reviewed the data for reasonableness and consistency. The performance data within this report represents past performance and is no guarantee of future results. All returns include internal expenses, except sales charges, if any. The rates of return shown are for the investment options in which the retirement program participates, not for the plan specifically. Returns credited to individual accounts will vary due to the timing of contributions, transfers, and withdrawals. DOCUMENT PAGE 64 11