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POLICE PENSION BOARD AGENDA AUGUST 14, 2014 - 10:00 A.M. CITY HALL CONFERENCE ROOM 15 LOOCKERMAN PLAZA DOVER, DELAWARE REVISED TO RE-ORDER AGENDA ITEMS 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 May 1, 2014 2. Organizational Issues - Election of Chair 3. Quarterly Performance Review (Quarter Ending June 30, 2014)/Investment Manager Recommendations (Milliman, Inc.) (Staff Recommends Acceptance of the Quarterly Performance Review) 4. Annual Review of Investment Policy 5. Future Meeting Dates (November 13, 2014; February 12, 2015; May 14, 2015; August 13, 2015) 6. 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 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 May 1, 2014 at 9:30 a.m with Chairman Mullaney presiding. Members present were Mr. Bonar (arrived at 9:33 a.m.), Mr. Stallings, Mr. Unterkofler, Chief Bernat, and Mr. Koenig. Mr. Lynn was absent. AGENDA ADDITIONS/DELETIONS By unanimous consent, the agenda was approved as presented. Approval of Minutes - Police Pension Board Meeting of February 26, 2014 Mr. Stallings moved for approval of the minutes of the Police Pension Board meeting of February 26, 2014, seconded by Mr. Unterkofler and unanimously carried. Quarterly Performance Review (Quarter Ending March 31, 2014) (Milliman, Inc.) Mr. Jeff Marzinsky, Principal and Employee Benefits Consultant, Milliman, Inc., reviewed the Board Meeting Notes dated May 1, 2014. He advised members that plan assets totaled approximately $11.6M as of March 31, 2014, which was an increase from approximately $11.5M at the beginning of the quarter. He noted that the 2.64% net return was within the plan benchmark for the quarter. He explained that the fund had been rebalanced for the quarter according to the asset allocation that was approved last year and was in line with target allocations. He stated that the plan consisted of approximately 60% equity funds and 40% fixed income, which he stated was a conservative portfolio. Mr. Marzinsky reviewed the Quarterly Investment Monitor Summary Report for the Quarter Ending March 31, 2014. Referring to Page 9 - Asset Allocation, Mr. Marzinsky reminded members that the Harding Loevner Global Equity Institutional Fund had been replaced in the portfolio by the more focused Oppenheimer International Growth Y equity fund. Mr. Marzinsky explained that, year to date, interest rates on short-term investments between one (1) and three (3) years had increased and interest rates on long-term investments had decreased, noting that as interest rates rise, the value of bonds declines. He indicated that it was possible that adjustments would have to be made to maintain the value of the portfolio and that this would be addressed at the Board’s meeting scheduled for August. Mr. Marzinsky advised members that Page 10, Investment Policy Review - Active Management, served as the “scorecard” for plan investments. He explained that the rank reflected how well the funds performed compared to other investments, with lower numbers indicating better rankings, and the majority of the funds ranked very well compared to their peers. The Excess Return showed the returns of the funds compared to the return of their market benchmarks, and the last six (6) columns reflected the risk and risk-adjusted return of each fund. Mr. Marzinsky stated that the Relative Standard Deviation reflected the volatility of each fund compared to its index fund and that a standard deviation of less than 1.0 indicated less volatility than the index. He explained that PIMCO had experienced some issues with upper management. The Chief Executive Officer (CEO) had resigned abruptly and would be replaced by the Chief Operating Officer (COO). Milliman had visited PIMCO and learned that changes had been made in its management structure. Mr. Marzinsky stated that PIMCO’s investment committee would be expanded, which would provide more perspectives on fixed income markets. Additionally, he noted that the Target Small

POLICE PENSION BOARD MEETING OF MAY 1, 2014 PAGE 2 Capitalization Value T Fund had underperformed compared to its index; however, on a risk-adjusted basis, it ranked very well compared to its peer group. Mr. Marzinsky assured members that both of these funds would be monitored by Milliman. In reference to Page 11 - Investment Policy Review - Passive Management, Mr. Marzinsky explained that index funds are expected to generally track their market benchmarks and have a very low expense ratio compared to actively managed funds. He reminded members that Vanguard had changed some of the underlying benchmarks that were previously followed; therefore, some variances were expected and were not a cause for concern. Referring to Page 12 - Investment Option Return Summary, Mr. Marzinsky stated that portfolio funds had generally positive returns year to date. The only underperforming area was emerging markets, which had a slight negative return. Long-term bonds were the best performing investment over the quarter. Equity markets had been volatile; however, having a mixed portfolio with long duration exposure benefitted the Fund. Mr. Marzinsky advised members that the overall portfolio return was approximately 2.7% through March 31, 2014 and exceeded the index of approximately 2.43%; over the last year the fund had returned approximately 8.13% versus the index of 8.07%. He stated that, it had been decided to develop a conservative portfolio to decrease volatility; however, he indicated that the Board may want to consider the potential effects of rising interest rates. Mr. Marzinsky provided members with a draft Investment Policy Statement for the City of Dover Police Plan (Attachment #1) and reminded them that the Police Pension Fund had been operating by a policy which was developed by the City’s previous investment advisor. He advised members that, when developing a draft of the new Policy Statement, he incorporated some of the terms of the prior investment policy statement relating to the roles and responsibilities of the Board in overseeing the portfolio and attempted to simplify some of the provisions relating to the investment manager selection and monitoring process. Mr. Marzinsky advised members that the Board typically tries to make asset allocation decisions during their August meeting and hoped that providing the draft Policy at this time would allow members an opportunity to review the document, make comments, and determine if they wished to consider changing the Investment Policy Statement as a whole. He indicated that if members were interested in reviewing alternative portfolios that may have higher returns, this could also be done. Mr. Koenig advised members that during the Other Post-Employment Benefits (OPEB) Board meeting held earlier in the day, Mr. Marzinsky had indicated that the OPEB portfolio ranked at approximately four (4) on a one (1) to 10 scale for aggressiveness, with a one (1) being the least aggressive and 10 being the most. He questioned how the Police Pension Fund would rate on this scale. Responding, Mr. Marzinsky stated that the OPEB, Police Pension, and Civilian Pension portfolios all had similar allocations. He noted that when the plans’ liabilities were evaluated slight adjustments were made in fixed income allocations in order to match a portion of the duration of the payments going out of the plans.

POLICE PENSION BOARD MEETING OF MAY 1, 2014 PAGE 3 Mr. Koenig questioned if it would be prudent for the Police Pension Fund to use a more aggressive investment strategy, since it had a fixed pool of plan participants, and whether this fixed pool would result in less risk. Responding, Mr. Marzinsky stated that if fixed payments were tied to fixed income investments, there would still be variability in interest rates. He explained that changes in interest rates could swing the value of a pension plan dramatically, noting that last year, as interest rates went up, the value of the liabilities went down. He reiterated that if interest rates continued to rise, the plan’s fixed income investments could yield negative returns; therefore, this was a potential problem that should be addressed at the Board’s next meeting. Mr. Stallings moved to accept the report, seconded by Mr. Unterkofler and unanimously carried. Mr. Stallings moved for adjournment, seconded by Mr. Unterkofler and unanimously carried. Meeting adjourned at 9:44 a.m. Timothy Mullaney Chair TM/JS/dd S:\AGENDAS-MINUTES-PACKETS-PRESENTATIONS-ATT&EXH\Misc-Minutes\PENSION\2014\05-01-2014 Police Pension.wpd Attachment Attachment #1 - Draft Investment Policy Statement - City of Dover Police Plan, dated August 2014

ATTACHMENT #1 Police Pension Board Meeting of May 1, 2014 DRAFT INVESTMENT POLICY STATEMENT CITY OF DOVER POLICE PLAN August 2014

Investment Policy Statement DRAFT City of Dover Police Pension Plan INVESTMENT POLICY STATEMENT CITY OF DOVER POLICE PENSION PLAN Table of Contents Section Page I. Purpose and Background 3 II. Statement of Objectives 4 III. Control Procedures & Responsibilities 5 IV. Investment & Allocation Policy 8 V. Investment Manager Guidelines 11 VI. Selection of Investment Managers 13 VII. Investment Evaluation 14 Page 2 of 16

Investment Policy Statement DRAFT City of Dover Police Pension Plan I. PURPOSE & BACKGROUND The Plan is a public employee retirement plan governed by The City of Dover Code of Ordinances. The purpose of this Investment Policy Statement (“IPS”) is to assist the participants of the plan who serve as members of the Police Pension Board of the City of Dover (“Board”) under Section 2-202 of the City of Dover Code of Ordinances, this Investment Policy Statement (“Statement”) presents investment objectives, policies, guidelines, and monitoring and review procedures relating to financial assets (the “Fund”) of the City of Dover Police Pension Plan (“Plan”). The IPS will function to: 1. State in a written document the Plan Sponsor’s expectations, objectives, and guidelines for the investment of Plan assets which the Plan Sponsor judges to be appropriate and prudent, in consideration of the needs of the Plan. 2. Define and assign the responsibilities for the oversight of the Plan’s assets. 3. Set forth an investment structure for managing Plan assets. This structure will help to define asset class, Investment Manager styles, asset allocation and acceptable ranges that, combined, will help to generate the risk/return profile needed to meet the objectives of this policy. 4. Encourage effective communication between the Plan Sponsor and the Investment Consultant, as well as any other interested parties. 5. Establish formalized performance criteria that the Investment Managers selected are expected to meet and against which they are to be measured on a regular basis. 6. Serve as a review document to guide Plan Sponsor and Investment Consultant oversight of the investment options of the Plan’s assets. 7. Establish the relevant investment time horizon, risk tolerances and performance expectations of the Plan assets and the Plan Sponsor. Page 3 of 16

Investment Policy Statement DRAFT City of Dover Police Pension Plan II. STATEMENT OF OBJECTIVES The assets of the Plan are invested under the supervision of the Board. After reviewing expected short-term and long-term cash flow requirements of the plan, as well as considering the investment time horizon and risk tolerance level believed to be appropriate for the invested assets, the following set of objectives has been established: 1. Preservation of capital. 2. Pay all benefit and expense obligations when due. 3. Achieve a funding cushion to reduce the impact of possible future downturns in the plan’s funded status. 4. Achieve or exceed actuarial earnings assumptions. 5. If applicable, effectively manage the funded status volatility and mitigate undue risk exposure under a Liability Driven Investment (LDI) strategy. The approach can assist in managing interest rate and inflationary risks. 6. Control risk exposure through reasonable and rational diversification of the assets into various asset classes. 7. Establish policies based on total return and expected projected payouts rather than current income. 8. Contain costs of administering and managing the portfolio. 9. Attain a funded status such that the employer has the option to terminate the plan if deemed appropriate. Page 4 of 16

Investment Policy Statement DRAFT City of Dover Police Pension Plan III. CONTROL PROCEDURES & RESPONSIBILITIES Disclosure Any member of the Board, Custodian/Directed Trustee or Investment Consultant must make full disclosure of any potential conflicts of interest, including any financial gain that may be received as a result of investment decisions made by those entities, which may be required by applicable law. This disclosure should be made before the investment of the plan assets governed by this Investment Policy Statement. Disclosure should be in written form and presented to the members of the Board. Delegation of Authority and Responsibilities The Board is charged under Section 18-51 of the City of Dover Code of Ordinances with overall responsibility for investment of the Fund. To assist the Board in this function, it is authorized and permitted by said Ordinances to appoint an IM or IM(s), including for this purpose banks, insurance companies, and firms registered under the Investment Advisers Act of 1940 and/or Delaware State law, to manage (including the power to acquire and dispose of) Plan assets. Any appointed IM must agree to conduct itself in accordance with all applicable City of Dover Ordinances. The Board shall be responsible for approving any changes to this Investment Policy Statement, and shall be responsible for reviewing the implementation of the Investment Policy Statement not less frequently than annually. These responsibilities include, but are not limited to: Board The Board will be responsible for establishing investment objectives, investment policy and monitoring and review procedures. The establishment of standards for measuring, monitoring, evaluating and comparing absolute and relative investment performance to assure that investment returns are reviewed on a regular basis and investment return objectives are met during acceptable periods of time. The establishment of authorization, reporting, control, review and general governance procedures to assure that investment policies and guidelines are reviewed on a regular basis and conformed to at all times. All modifications of policies and/or guidelines shall be in writing, signed by all Board members, and delivered on a timely basis to any IM and/or Custodian affected by such changes. The establishment of, through contractual relationships with recognized and carefully selected professional organizations, or by alternative means satisfactory to the Board, a retirement plan management structure which will assure appropriate investment management, custody, and surveillance or compliance procedures to meet investment objectives in conformity with the Board's stated investment policies and guidelines. The Board will have discretion to select, add, replace or remove Investment Managers that will be used to meet the Plan’s investment objectives, consistent with the recommendations and advice of the Investment Consultant. Page 5 of 16

Investment Policy Statement DRAFT City of Dover Police Pension Plan Investment Consultant The Investment Consultant will be responsible for: providing recommendations to the Board for the selection of Investment Managers and appropriate asset allocation, consistent with the Investment Policy Statement objectives and guidelines; reviewing the performance of such Investment Managers over time; periodically reviewing and providing recommendations to the Board for revisions to the Investment Policy Statement; and other tasks as deemed appropriate by the Board. The Investment Consultant will act in a non-discretionary capacity. Custodian/Directed Trustee The Custodian/Directed Trustee appointed by the Board will be responsible for the safekeeping of the fund assets, including all transaction settlements and deliveries and will perform regular accounting of all assets owned, purchased or sold, as well as transactions and movement of assets into and out of the Plan account. Fund safekeeping and securities settlement procedures shall include direct Custodian participation in one or more appropriate securities depositories (e.g., Depository Trust Company, New York) and, as necessary, correspondent participation in other major depositories (e.g., the Federal Reserve System). The Plan's beneficial ownership of all assets shall be inviolate and in all circumstances perfected. Board or designated IM authority to direct all investment transactions shall similarly be protected. The Directed Trustee will maintain possession of securities owned by the Plan, collect dividend and interest payments, redeem maturing securities, and effect receipt and delivery following purchases and sales. The Directed Trustee will also be responsible for the payments to such persons and for such purposes in order to provide benefits to plan participants and the remittance of any tax related payments to the applicable State and Federal bodies. Fiduciary insurance, and officer liability and omissions and errors insurance coverages, of any Custodian, must meet standards set by the Board from time to time. Investment Manager(s) The specific responsibilities of the Investment Manager(s) relating to the investment management of the fund include: 1. Managing the Plan assets under its care, custody, and/or control in accordance with the Investment Policy Statement (‘IPS’) objectives and guidelines set forth herein. 2. Exercising investment discretion (including holding cash equivalents as an alternative) within the IPS objective and guidelines set forth herein. 3. Promptly communicating all significant and/or material matters and changes pertaining to the investment of Plan assets, including, but not limited to: i. Investment strategy. ii. Portfolio structure. iii. Tactical approaches. iv. Ownership. v. Organizational structure. vi. Financial condition. vii. Professional staff. viii. All legal material and SEC and other regulatory agency proceedings affecting the firm. Page 6 of 16

Investment Policy Statement DRAFT City of Dover Police Pension Plan 4. Promptly voting all proxies and related actions in a manner consistent with the long-term interests and objectives of the Plan set forth herein. Each manager shall keep detailed records of said voting and proxies and related actions and will comply with all regulatory obligations related thereto. 5. Utilize the same care, skill, prudence, and due diligence under the circumstances then prevailing that experienced, investment professionals acting in a like capacity and fully familiar with such matters would use in like activities for like benefit plans with like aims in accordance and compliance with all applicable laws, rules, and regulations from local, state, and federal political entities as the pertain to fiduciary duties and responsibilities. The investments should be relatively liquid, or with a reasonable amount of notice, should be capable of liquidating to cash. There should be no fees or penalties for regular trading or liquidation. Page 7 of 16

Investment Policy Statement DRAFT City of Dover Police Pension Plan IV. INVESTMENT AND ALLOCATION POLICY Investment Horizon: The investment guidelines are based on the expectation that the investment horizon will be several years in length. Short-term variability in returns should be expected. Because of this, the Plan’s strategic asset allocation is established with moderate to long-term perspective in mind. The Plan is required to pay retirement benefits to participants as they come due. Therefore, sufficient liquid reserves must be available to satisfy this obligation. 1. The actuary will provide future benefit payment amounts, funding and contribution requirements. 2. The plan should hold a portion of assets in short-term and cash holdings to provide for the schedule of future benefit payments. Risk Tolerances: It is understood by the Board that achieving the Plan’s investment objectives is not guaranteed and there will be time periods for which these objectives will not be met. The Board also recognizes that some risk must be assumed to achieve the Plan’s investment objectives and accepts the inevitable fluctuations in returns that will occur. While it is understood that a certain level of risk is expected in the Plan’s portfolio, the ability to withstand short and intermediate term variability was specifically considered in the development of the IPS risk tolerances. Factors considered were: 1. It is the intention to fund at least the minimum required contribution (MRC) each year providing ample liquidity. 2. Due to the amount of payouts to occur for many years into the future, the Plan’s liabilities exhibit a longer duration (sensitivity to changes in interest rates). As a result, extending durations in the fixed income portion of Plan assets should be considered. 3. The cash balance portion of the plan's liabilities grows at the rate of T-bill + 1%. Future liability growth will be factored into all investment decisions. As a result of the above-named considerations, the Board believes that the Plan can tolerate some interim variability in market value and rates of return in order to achieve its long-term objectives. Allowable Investments: Cash and Equivalents, Mutual Funds, Separate Accounts, Options and Futures Contracts, Stocks, Bonds, Commingled Funds, and Collective Trusts, Exchange Traded Funds (ETFs) Page 8 of 16

Investment Policy Statement DRAFT City of Dover Police Pension Plan Liquidity Policy: The trust will be required to provide periodic distributions in the form of retirement benefit payments to participants. The actuary provides annual assessments of the funding requirements and payments necessary to meet the plans benefit obligations. Overall Asset Allocation Policy Based on the Plan’s time horizon, risk tolerances, liquidity needs, and asset class preferences and constraints, an efficient or optimal portfolio was identified. This allocation shall be reviewed at least annually and modified as necessary to meet the needs of the Plan Sponsor. The strategic asset allocation of the Plan is as follows: Asset Class Range Target Cash & Short-Term Bond 5% - 10% 10% Inflation-Protected Bond 0% - 10% 5% Intermediate Term Bond 3% - 13% 8% Long-Term Bond 4% - 14% 9% High Yield Bond 3% - 13% 8% Large Value 5% - 15% 10% Large Growth 6% - 16% 10% Mid Cap 0% - 10% 5% Small Cap 3% - 13% 8% Foreign Equity 5% - 15% 10% Diversified Emerging Mkts 5% - 15% 10% Real Estate 2% - 12% 7% The above ranges will be considered the long-term or policy allocation. The current “Policy” is the target for such respective Asset Class of investment. Any deviations beyond the “Range” must have prior approval by the Board, unless caused by market actions. Based on the Plan’s time horizon, risk tolerances, liquidity needs, and asset class preferences and constraints, an efficient or optimal portfolio was identified. This allocation strategy is dynamic in nature under a Liability Drive Investment (LDI) approach. The allocation shall be reviewed periodically, at least annually, and modified as necessary to meet targets as below, based on the funded status of the plan. The overall performance of the portfolio relative to the liabilities will be reviewed in addition to actual performance of the managers. Page 9 of 16

Investment Policy Statement DRAFT City of Dover Police Pension Plan The strategic asset allocation of the Plan is as follows: Dynamic Investment Policy Funded Status Asset Category 40% 70% 80% 85% 90% 95% 100% Cash & Short Term Bond 10% 8% 5% 5% 5% 5% 5% US Treasuries/Inflation-linked 5% 6% 7% 7% 9% 10% 13% Intermediate Term Bond 8% 10% 12% 14% 16% 21% 23% Long Term Bond 9% 9% 11% 12% 15% 20% 24% High Yield Bond 8% 9% 9% 10% 10% 10% 10% Large Cap Value – US Stock 10% 10% 9% 8% 8% 7% 4% Large Cap Growth – US Stock 10% 9% 9% 8% 7% 5% 4% Mid Cap – US Stock 5% 5% 5% 5% 5% 4% 3% Small Cap – US Stock 8% 8% 8% 6% 4% 3% 3% Real Estate/REIT 7% 7% 6% 5% 4% 3% 3% Non-US Stock 10% 9% 9% 8% 7% 5% 3% Emerging Markets 10% 10% 10% 10% 10% 7% 5% Equity 60% 58% 56% 50% 45% 34% 25% Fixed Income/Cash 40% 42% 44% 48% 55% 66% 75% Total 100% 100% 100% 98% 100% 100% 100% Rebalancing: Rebalancing is the periodic adjustment of the portfolio to restore a pre-defined Target asset allocation, and will be reviewed at least once per calendar quarter, or as such when the allocation of any asset class exceeds the range around its respective target. Change in Funding Target Level Based on the asset allocation glidepath and funding target levels outlined in the Asset Allocation Policy, an increase in the Plan funding ratio that elevates the plan to a new increment level will trigger a rebalancing of Plan assets to the new targets. If the Plan funding ratio decreases and meets a lower target level, the plan will not rebalance to the new target asset allocation. Timing Rebalancing reviews generally take place quarterly, or at a frequency determined by appropriate by the Board. Generally, the rebalancing transactions will occur over a period of time to reduce undue market timing risk. The Plan will diversify its investment portfolio to avoid incurring unreasonable risks. Investment maturities should be scheduled to coincide with projected cash flow requirements. As funded status improves, the asset allocation policy targets will reduce equity investments and increase fixed income investments and “de-risk” the plan portfolio. Page 10 of 16

Investment Policy Statement DRAFT City of Dover Police Pension Plan V. INVESTMENT MANAGER GUIDELINES Every Investment Manager selected to manage Plan assets shall be selected by their policy or ability to adhere to these general guidelines; however will have discretion to meet the investment objectives of their portfolio or investment fund. Unless receiving prior Board approval, the only allowable investments of the Plan will be in cash and equivalents, mutual funds, separate accounts, commingled funds, and collective trusts: Cash Policy Cash equivalents will be invested in an appropriate cash-like fund. Returns should be equal to or better than the 90-day Treasury Bill Index (3-month). Money market mutual funds may be used, so long as these funds meet the high standards suitable for funds of this nature. Fixed Income Policy Investment Objectives These assets are to be invested in a mutual fund, commingled funds, separate accounts, or collective trusts of high-grade index or active fixed income portfolio subject to the limitations set forth below. The investment objectives of the fixed income portion in order of importance are: 1. Preservation of capital 2. Provide for regular dividend and or interest payments 3. Stability of returns – obtain fairly consistent annual returns. Investment Guidelines The Plan’s fixed income assets will be managed in accordance with the following: 1. All funds selected for the fixed income portion must have a readily ascertainable market value and must be readily marketable. 2. Investment Managers selected will be diversified and generally conform to industry guidelines. 3. The Investment Managers shall have discretion to invest a portion of the assets in cash reserves when they deem appropriate. However, the Investment Managers will be evaluated against their peers on the performance of the total funds under their direct management. Page 11 of 16

Investment Policy Statement DRAFT City of Dover Police Pension Plan Equity Policy Investment Objectives Equity assets are to be invested in mutual funds, commingled funds, separate accounts, or collective trusts. Within this framework, the investment objectives of the equity portion are: 1. Long Term Growth of Capital – Assets, exclusive of contribution and withdrawals, should grow in the long run and earn returns equal to the market while risk should be less than the market. 2. Follow a predefined market style (e.g. large cap vs. small cap, value vs. growth) strategy. Investment Guidelines The Plan’s equity assets will be managed in accordance with the following: 1. All funds selected for the equity portion must have a readily ascertainable market value and must be readily marketable. 2. Investment Managers selected will be diversified and generally conform to industry guidelines. 3. The Investment Managers shall have discretion to invest a portion of the assets in cash reserves when they deem appropriate. However, the Fund Managers will be evaluated against their peers on the performance of the total funds under their direct management. Page 12 of 16

Investment Policy Statement DRAFT City of Dover Police Pension Plan VI. SELECTION OF INVESTMENT MANAGERS The Board, with the assistance of the Investment Consultant, will select appropriate Investment Managers to manage the Plan assets. Investment Managers must meet the following minimum criteria: 1. Is a bank, insurance company, investment management company, or investment advisor as defined by the Registered Investment Advisers Act of 1940. 2. Provide at a minimum, historical quarterly performance numbers calculated on a time-weighted basis, based on a composite of all the fully discretionary accounts of similar investment style, and reported net and gross of fees. 3. Provide performance evaluation reports prepared by an objective third party that illustrate the risk/return profile of the Investment Manager relative to other managers of like investment style. 4. Provide detailed information on the history of the firm, key personnel, key clients, fee schedule, and support personnel. This information can be supplied by a third party vendor comparable to Lipper or Morningstar. 5. Clearly articulate the investment strategy that will be followed and document that the strategy has been successfully adhered to over time. 6. Investment Managers will be ranked within the top 50 percent of their respective styles on the Investment Consultant’s internal ranking program when available. 7. Some of the measures that may be included in the statistical analysis of a fund would be: a. Alpha – a measure of fund performance compared to its expected return b. Beta – the general level of influence a fund’s market has over its performance c. Standard Deviation – a measure of a fund’s variation of returns over time d. Sharpe Ratio – a measure of a fund’s risk-adjusted return compared to its risk e. Duration – a measure of sensitivity to interest rate fluctuations over time 8. The Board will consider replacing an actively managed fund if the rank versus its peer group remains in the bottom 50 percent for four consecutive quarters versus its peer group and if statistical analysis concludes that the fund’s level of return does not provide an acceptable ratio as compared to its general level of risk. 9. The Board may consider a fund for replacement when the Investment Manager or policy of the fund is changed. In addition, if there are any substantial transactions with regard to the fund management company or holding, or other types of instabilities in the fund company, replacement will be considered. 10. The Board may also consider replacing a fund if its relative performance over a complete market cycle trails its benchmark. Page 13 of 16

Investment Policy Statement DRAFT City of Dover Police Pension Plan VII. INVESTMENT EVALUATION Not more than 90 days after the end of each calendar quarter, the Investment Consultant shall report investment positions and performance results to the Board, based on performance reported by each Fund Manager, to monitor and evaluate progress toward the attainment of longer-term targets. The target rate of return for the Plan has been based on the assumption that future real returns will approximate the long-term rates of return experienced for each asset class in the IPS. The real rate of return is the return in excess of the anticipated rate of inflation as measured by the Consumer Price Index (CPI). Total Plan Portfolio: Over a complete business cycle, the Plan’s overall annualized total return (net of expenses) should perform at or above the Plan Benchmark. The target allocation is based on the plan’s funded status. This Plan Benchmark is a customized index composed of the following benchmarks for each target asset class and based on the funded status target allocation: Asset Category Index* Cash & Money Market BofA ML 3-month T-bill Total Return Index Short-term Bond Barclays US Govt/Credit 1-3 Yr TR USD Inflation Protected Bond Barclays US Treasury US TIPS TR USD Intermediate-term Bond Barclays US Govt 5-10 Yr TR USD Long-term Bond BC Long Government/Credit High Yield Bond BC High Yield Corporate Bond Large Cap Value S&P 500 Value Large Cap Blend S&P 500 Index Large Cap Growth S&P 500 Growth Mid Cap Value S&P 400 Value Mid Cap Blend S&P 400 Index Mid Cap Growth S&P 400 Growth Small Cap Value S&P 600 Value Small Cap Blend S&P 600 Index Small Cap Growth S&P 600 Growth World Stock MSCI AC World Index ND USD Diversified Emerging Markets FTSE Emerging NR USD REIT/Real Estate MSCI US REIT NR USD *Or other index as designated by the fund and/or fund manager as an appropriate target benchmark for the investment portfolio or fund. Individual Investment Managers: During its periodic meetings but not less than annually, the Board will review the following specifics with regard to each Investment Manager: 1. The manager’s adherence to their prospectus. 2. Material changes in the manager’s organization, investment philosophy, and/or personnel. 3. Performance compared against an appropriate peer group and benchmark, as listed in the Executive Summary of this IPS, over various time periods. Page 14 of 16

Investment Policy Statement DRAFT City of Dover Police Pension Plan The Board expects the following criteria to be met by each Investment Manager. If a manager fails to meet these, a further review of the manager will be warranted. The Board reserves the right to replace an Investment Manager at their discretion at any time. 1. The Investment Manager’s rank (3-year and 5-year return) versus its peer group is over 50 (where a percentile ranking of 1 would be the highest a fund could achieve and 100 would be the lowest). If a fund or Investment Manager’s rank (3-year and 5-year return) versus its peer group is over 50, the fund will warrant a closer analytic review. The Board’s review will be comprised of a further analysis of the fund’s statistical performance and risk measures. 2. The Investment Manager should not fall in the southeast quadrant of a standard risk/return plot over 3 and/or 5 years. 3. The Investment Manager’s risk over 3 to 5 years, as measured by standard deviation, should be equal to or lower than the comparative index. If the standard deviation is higher than the index, an increase in performance is expected. 4. The Investment Manager’s Sharpe ratio should be positive over 3 to 5 years and ranked above the peer group median. 5. The Investment Manager’s Alpha should be positive over a 3 to 5 year period and ranked above the peer group median. Page 15 of 16

Investment Policy Statement DRAFT City of Dover Police Pension Plan SIGNATURE This Statement of Investment Policy approved by action of the Board. Approved by: _______________________________________________ Chairman or representative of the Board _______________________________________________ Treasurer/Finance Director Date approved: ___________ Page 16 of 16

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 – 8/14/2014 Enclosures: Milliman Quarterly Investment Monitor Report (QIM) 1. Police Pension Plan Investment Review through 6/30/14: a. As of June 30, the plan had assets of approximately $12.26 million, up from $11.59 million at 3/31/2014. At 6/30/2013, the plan had $11.04 million. During the quarter, the plan had contributions of approximately $604 thousand, withdrawals of approximately $391 thousand, and fees of $1.27 thousand. b. Total performance of the plan portfolio was 3.96% net (4.04% gross) for the quarter, in line with the Plan’s benchmark index performance of 4.20%. City of Dover Police Pension Plan Quarterly Return Summary POLICE-NET POLICE GROSS- Month End BMV Contribution Withdrawls Fees Gain EMV RETURN RETURN 7/31/2013 $ 11,035,209.19 $ 932.00 $ 127,422.77 $ 474.22 $ 251,721.56 $ 11,159,965.76 2.31% 2.33% 8/31/2013 $ 11,159,965.76 $ 89,276.85 $ 127,486.81 $ 452.59 $ (266,321.80) $ 10,854,981.41 -2.41% -2.39% 9/30/2013 $ 10,854,981.41 $ 307,400.00 $ 127,486.81 $ 445.06 $ 380,551.50 $ 11,415,001.04 3.46% 3.49% 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% $ 603,786.38 $ 390,786.43 $ 1,271.93 $ 455,002.94 Quarterly Return 3.96% 4.04% $ 1,208,021.62 $ 1,545,623.72 $ 5,247.45 $ 1,569,039.31 One Year Return 14.61% 14.93% c. As of 6/30/14, 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 8/2013 Money Market CA Wells Fargo Advtg Treas Plus MMkt 4.50% 0-10%; target 10% Cash + STB Short Term Bonds STB Vanguard Short Term Bond 5.50% 0-10%; target 10% Cash + STB Inflation Protected Bonds TIPS Vanguard Inflation Prot Sec 6.00% 0-11%; target of 6% 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 6.00% 0-11%; target 6% HYB Large Cap Value LCV Vanguard Equity Income 10.00% 5-15%; target 10% LCV Large Cap Growth LCG Vanguard Morgan Growth 5.50% 6-11%; target 11% LCG Large Cap Growth LCG Vanguard Primecap 5.50% 6-11%; target 11% LCG Mid Cap MCV Vanguard Mid Cap Value Index 5.00% 0-10%; target 5% MC Small Cap SCV Target Small Cap Value 7.00% 0-10%; target 7% SC Real Estatement Investment REIT Vanguard REIT Index 8.00% 0-13%; target 8% REIT Foreign Equity GLB American Funds New Perspective 5.00% 5-15%; target 10% GLB Foreign Equity FLG Oppenheimber International Growth Y 5.00% 5-15%; target 10% FLG 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 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. Vanguard Morgan Growth - Has shown under-performance to its benchmark, as well as a decline in risk and return rank to its peer group. ii. Vanguard Prime Cap - During the quarter Vanguard funds had restricted trading in the Vanguard Prime Cap fund and will not allow investment of new contributions. iii. Recommendation(s):  Add Vanguard Growth Index and Vanguard Mid Cap Index as new investment options within the portfolio.  Remove Vanguard Morgan Growth and map the balance 75% to Vanguard Growth Index and 25% to Vanguard Mid Cap Index.  Retain Vanguard Prime Cap as an investment option in the plan and hold current assets.  Utilize Vanguard Growth Index for future contributions that would have been allocated to Vanguard Prime Cap. 2. Annual Investment Policy and Asset Allocation Review 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 June 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 2 DOCUMENT PAGE 5

Quarterly Investment Monitor Market Indices - 2nd Quarter 2014 Index 3 1 3 5 Months Year Years Years BofAML US Treasury Bill 3 Mon 0.01 0.05 0.07 0.11 Barclays US Govt 1-3 Yr TR USD 0.27 0.77 0.66 1.24 Barclays US Govt/Credit Interm TR USD 1.23 2.86 2.83 4.09 Barclays US Government Long TR USD 4.73 6.44 8.70 7.41 Barclays US Long Credit TR USD 5.04 13.34 9.81 11.11 Barclays US Corporate High Yield TR USD 2.41 11.73 9.48 13.98 DJ Industrial Average TR USD 2.83 15.56 13.57 17.83 S&P 500 TR 5.23 24.61 16.58 18.83 NASDAQ 100 TR USD 7.42 34.15 19.86 22.31 NASDAQ Composite TR USD 5.31 31.16 18.18 20.50 Russell 1000 Value TR USD 5.10 23.81 16.92 19.23 Russell 1000 TR USD 5.12 25.35 16.62 19.25 Russell 1000 Growth TR USD 5.13 26.92 16.26 19.24 Russell 2000 Value TR USD 2.38 22.54 14.65 19.88 Russell 2000 TR USD 2.05 23.64 14.57 20.21 Russell 2000 Growth TR USD 1.72 24.73 14.49 20.50 FTSE NAREIT All REITs TR 6.97 13.71 12.01 22.92 MSCI EAFE NR USD 4.09 23.57 8.10 11.77 MSCI EAFE Small Cap NR USD 2.08 29.08 9.84 15.21 MSCI EM NR USD 6.59 14.31 -0.39 9.24 City of Dover, Delaware Police Pension Plan 3 DOCUMENT PAGE 6

Quarterly Investment Monitor Broad Market Commentary - 2nd Quarter 2014 Broad Markets - Quarter Broad Markets - Five Years Apr-14 - Jun-14 Jun-09 - Jun-14 6 260 240 5 220 4 Total Return, % Growth of $100 200 3 180 160 2 140 1 120 0 100 Apr-14 - Jun-14 Jun-09 Dec-09 Jun-10 Dec-10 Jun-11 Dec-11 Jun-12 Dec-12 Jun-13 Dec-13 Jun-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 on strong mergers-and-acquisitions activity, better than expected corporate earnings, and signs of an improving economy. Developed international equity markets posted solid returns on central bank stimulus and an increase in mergers-and-acquisitions activity, while emerging markets rebounded on expectations of an improving global economy and reduced political uncertainty in certain developing countries. Market volatility was unusually low during the quarter. The Fed continued to modestly reduce its securities purchases by $10 billion at each meeting. In addition, the Fed announced it will end its securities purchases program in October if the economy stays on track. Mutual fund investors increased their holdings in bonds and stocks. For the quarter, bond funds had net inflows of $28.4 billion, while stock funds had net inflows of $7.4 billion. Total money market mutual fund assets decreased by $86.0 billion to $2.557 trillion. The unemployment rate fell from 6.7% to 6.1%, as total employment increased by 816,000 jobs. The price of oil increased from $102 per barrel to $105 during the quarter, an increase of 2.9%. City of Dover, Delaware Police Pension Plan 4 DOCUMENT PAGE 7

Quarterly Investment Monitor US Fixed Income Market Commentary - 2nd Quarter 2014 US Fixed Income - Quarter US Fixed Income - Five Years Apr-14 - Jun-14 Jun-09 - Jun-14 6 200 190 5 180 170 Growth of $100 4 160 Total Return, % 150 3 140 130 2 120 110 1 100 90 0 Jun-09 Dec-09 Jun-10 Dec-10 Jun-11 Dec-11 Jun-12 Dec-12 Jun-13 Dec-13 Jun-14 Apr-14 - Jun-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 2.04% in the 2nd quarter, as the positive impact from a 0.17% decline in interest rates enhanced the coupon return of 0.78%. The short end of the yield curve remained unchanged as the Fed maintained its near-zero interest rate policy. The yield curve continued to flattened as the 30-year Treasury yield fell by 0.20%, while the 2-year rose by 0.04%. Long-term government bonds were the best performing sector this quarter, up 5.06%, as U.S. and foreign institutions purchased long-term U.S. Treasuries (Fed's QE program and foreigners increasing dollar reserves). Long-term corporate bonds were up 4.31% due to tightening spreads and declining yields on the long end of the curve. 3-month T-Bills were the worst performing sector this quarter, up 0.01%, as short-term rates remained near 0%. City of Dover, Delaware Police Pension Plan 5 DOCUMENT PAGE 8

Quarterly Investment Monitor US Equity Market Commentary - 2nd Quarter 2014 US Equity - Quarter US Equity - Five Years Apr-14 - Jun-14 Jun-09 - Jun-14 6 260 240 5 220 4 Total Return, % Growth of $100 200 3 180 160 2 140 1 120 0 100 Apr-14 - Jun-14 Jun-09 Dec-09 Jun-10 Dec-10 Jun-11 Dec-11 Jun-12 Dec-12 Jun-13 Dec-13 Jun-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 Most major domestic equity indices posted a gain for the quarter. The large-cap Russell 1000 Growth Index had the best return, up 5.13%. In terms of capitalization, large-cap stocks outperformed small-cap stocks. In comparing styles, growth outperformed value in the large-cap area of the market, while value exceeded growth in the small-cap area. REITs rose 7.15%, as the U.S. commercial real estate market continued to improve and lower interest rates increased demand for dividend-paying stocks. The best performing sectors were hotels and timber. Energy was the best performing sector, up 12.28%, on fears of a potential oil and gas shortage due to political instability in the Middle East and Ukraine. Financials was the worst performing sector, up just 2.48%, on weaker loan demand and falling long term rates. City of Dover, Delaware Police Pension Plan 6 DOCUMENT PAGE 9

Quarterly Investment Monitor International Market Commentary - 2nd Quarter 2014 International - Quarter Apr-14 - Jun-14 7 6 International - Five Years 5 Jun-09 - Jun-14 Total Return, % 220 4 3 2 200 1 0 180 Growth of $100 MSCI EAFE NR USD MSCI EAFE Small Cap NR USD 160 MSCI EM NR USD Regional Performance - Quarter Apr-14 - Jun-14 140 7 6 120 5 Total Return, % 4 100 3 Jun-09 Dec-09 Jun-10 Dec-10 Jun-11 Dec-11 Jun-12 Dec-12 Jun-13 Dec-13 Jun-14 2 MSCI EAFE NR USD MSCI EAFE Small Cap NR USD 1 MSCI EM NR USD 0 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 down against the yen and pound, but up against the euro. For the quarter, the EAFE Index was up 4.09%, and Emerging Markets were down 6.59%. Local currency returns for the EAFE Index and Emerging Markets were 3.41% and 5.14%, respectively. Among the major international regions, Indian stocks had the highest return, up 16.83%, as the election of a pro-business government fueled hopes for economic reforms and a faster growing economy. Stocks in Russia also rose substantially (+12.10%), as the conflict with Ukraine de-escalated, oil prices rose, and Russia signed an agreement to $400 billion in gas to China. Large-Cap stocks, up 4.1%, outperformed small-cap stocks, up 2.1%. City of Dover, Delaware Police Pension Plan 7 DOCUMENT PAGE 10

Quarterly Investment Monitor Data as of 06/30/2014 Performance Summary City of Dover, Delaware Police Pension Plan 8 DOCUMENT PAGE 11

Quarterly Investment Monitor Data as of 06/30/2014 Asset Allocation Balances As of Percent As of Balances As of Percent As of Notes 06/30/2014 06/30/2014 03/31/2014 03/31/2014 Wells Fargo Advantage Treas Plus MMkt I $559,525 4.56% $514,903 4.44% PISXX Vanguard Short-Term Bond Index Signal $672,865 5.49% $632,505 5.46% VBSSX Vanguard Inflation-Protected Secs I $611,666 4.99% $574,667 4.96% VIPIX Vanguard Interm-Term Bond Index Signal $981,645 8.01% $922,444 7.96% VIBSX Vanguard Long-Term Bond Index I $553,824 4.52% $523,139 4.51% VBLLX PIMCO Long Duration Total Return Instl $551,412 4.50% $520,448 4.49% PLRIX Ivy High Income I $981,333 8.00% $924,964 7.98% IVHIX Vanguard Equity-Income Adm $1,220,203 9.95% $1,168,552 10.08% VEIRX Vanguard Morgan Growth Admiral $612,293 4.99% $566,910 4.89% VMRAX Vanguard PRIMECAP Inv $600,840 4.90% $574,435 4.95% VPMCX Vanguard Mid-Cap Value Index Admiral $613,970 5.01% $577,793 4.98% VMVAX Target Small Capitalization Value T $985,347 8.04% $912,291 7.87% TASVX Oppenheimer International Growth Y $615,840 5.02% $576,632 4.97% OIGYX American Funds New Perspective R6 $611,841 4.99% $579,785 5.00% RNPGX Vanguard Emerging Mkts Stock Idx I $1,228,100 10.02% $1,211,590 10.45% VEMIX Vanguard REIT Index I $858,444 7.00% $812,092 7.00% VGSNX Plan Total $12,259,147 $11,593,150 City of Dover, Delaware Police Pension Plan 9 DOCUMENT PAGE 12

Quarterly Investment Monitor Data as of 06/30/2014 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 11 27 0.01 -0.06 1.03 1.02 32 24 51 46 PIMCO Long Duration Total Return Instl 27 33 -0.77 0.32 0.94 0.96 82 73 67 67 Ivy High Income I 4 15 1.65 0.22 0.77 0.74 1 1 1 1 Vanguard Equity-Income Adm 11 10 1.17 1.30 0.80 0.83 3 1 4 3 Vanguard Morgan Growth Admiral 59 36 -2.84 -0.81 1.24 1.17 70 65 57 48 Vanguard PRIMECAP Inv 6 20 1.14 0.37 1.11 1.09 5 5 12 10 Target Small Capitalization Value T 52 57 -3.22 -1.58 0.91 0.87 34 25 24 20 Oppenheimer International Growth Y 5 3 2.92 3.56 0.96 1.01 5 4 3 3 American Funds New Perspective R6 33 34 2.06 1.68 0.96 0.98 31 27 34 27 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 10 DOCUMENT PAGE 13

Quarterly Investment Monitor Data as of 06/30/2014 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 0.53 0.80 2.11 0.66 1.81 0.77 0.10 Vanguard Interm-Term Bond Index Signal 1.16 1.77 0.84 1.96 0.84 1.95 0.10 Vanguard Long-Term Bond Index I -0.02 -0.03 1.02 0.90 1.03 0.88 0.07 Vanguard Mid-Cap Value Index Admiral -0.61 -0.45 1.03 0.92 1.00 1.33 0.09 Vanguard Emerging Mkts Stock Idx I -0.44 -0.21 1.02 3.24 1.03 3.12 0.12 Vanguard REIT Index I 1.25 1.43 1.00 0.21 1.00 0.20 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 11 DOCUMENT PAGE 14

Quarterly Investment Monitor Data as of 06/30/2014 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 0.00 0.01 0.01 0.01 1.48 PISXX NA 0.20 BofA ML 3-month T-bill total return Index 0.01 0.02 0.05 0.07 0.11 1.63 N/A NA NA Short-term Bond Vanguard Short-Term Bond Index Signal 0.58 0.98 1.69 1.53 2.53 3.46 VBSSX 3.00 0.10 Barclays US Govt/Credit 1-3 Yr TR USD 0.33 0.56 1.14 1.00 1.73 2.96 N/A NA NA Inflation-Protected Bond Vanguard Inflation-Protected Secs I 3.75 5.91 4.47 3.56 5.50 5.12 VIPIX 4.00 0.07 Barclays US Treasury US TIPS TR USD 3.81 5.83 4.44 3.55 5.55 5.25 N/A NA NA Intermediate-term Bond Vanguard Interm-Term Bond Index Signal 2.42 4.99 5.17 5.05 6.75 5.89 VIBSX 4.00 0.10 Barclays US Govt 5-10 Yr TR USD 2.04 3.88 2.63 3.89 4.99 5.49 N/A NA NA Long-term Bond Vanguard Long-Term Bond Index I 4.84 12.14 10.55 9.55 9.56 7.62 VBLLX 3.00 0.07 Long-term Bond PIMCO Long Duration Total Return Instl 5.02 11.93 10.96 8.79 9.91 NA PLRIX 4.00 0.50 BC Long Government/Credit 4.93 11.81 10.77 9.57 9.60 7.60 N/A NA NA High Yield Bond Ivy High Income I 1.77 4.73 11.46 11.14 14.20 9.22 IVHIX 4.00 0.70 BC High Yield Corporate Bond 2.41 5.46 11.73 9.48 13.98 9.05 N/A NA NA Large Value Vanguard Equity-Income Adm 5.18 7.64 21.57 17.42 19.82 9.15 VEIRX 5.00 0.21 S&P 500 Value 4.60 6.96 21.99 16.25 18.52 7.56 N/A NA NA Large Growth Vanguard Morgan Growth Admiral 3.52 4.49 25.60 14.12 18.38 8.05 VMRAX 3.00 0.25 Large Growth Vanguard PRIMECAP Inv 4.63 9.89 30.34 18.09 19.56 10.17 VPMCX 5.00 0.45 S&P 500 Growth 5.82 7.29 27.13 16.96 19.19 7.95 N/A NA NA Mid-Cap Value Vanguard Mid-Cap Value Index Admiral 4.94 9.01 28.36 17.55 22.87 NA VMVAX 5.00 0.09 CRSP US Mid Cap Value TR USD 4.97 9.07 28.49 18.17 23.32 10.23 N/A NA NA Small Value Target Small Capitalization Value T 3.46 4.81 23.64 14.68 20.09 10.59 TASVX 4.00 0.67 S&P 600 Value 2.28 4.46 25.41 17.91 21.67 9.54 N/A NA NA Foreign Large Growth Oppenheimer International Growth Y 1.35 2.38 20.93 10.58 15.60 10.20 OIGYX 5.00 0.90 MSCI EAFE Large Growth NR USD 3.64 3.11 19.56 7.66 12.03 7.22 N/A NA NA World Stock American Funds New Perspective R6 3.24 3.57 21.90 12.31 15.96 9.43 RNPGX 4.00 0.45 MSCI AC World Index ND USD 5.04 6.18 22.95 10.25 14.28 7.46 N/A NA NA Diversified Emerging Mkts Vanguard Emerging Mkts Stock Idx I 7.44 7.11 14.08 (0.82) 9.00 11.57 VEMIX 3.00 0.12 FTSE Emerging NR USD 7.52 7.38 13.74 (0.38) 9.21 12.30 N/A NA NA Real Estate Vanguard REIT Index I 6.99 17.65 13.40 11.81 23.82 9.84 VGSNX 4.00 0.08 MSCI US REIT NR USD 6.69 17.00 12.02 10.56 22.39 NA N/A NA NA Total Plan POLICE GROSS-RETURN 4.04 6.86 14.93 7.00 10.84 NA N/A NA NA Total Plan POLICE-NET RETURN 3.96 6.70 14.61 6.70 10.53 NA N/A NA NA Police Plan Policy Index 4.20 6.73 14.87 8.27 11.60 6.33 N/A NA NA City of Dover, Delaware Police Pension Plan 12 DOCUMENT PAGE 15

Quarterly Investment Monitor Data as of 06/30/2014 U.S. Fixed Income Style Map 36 Month moving average, Jul-09 - Jun-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 13 DOCUMENT PAGE 16

Quarterly Investment Monitor Data as of 06/30/2014 U.S. Equity Style Map 36 Month moving average, Jul-09 - Jun-14 LgValue LgGrowth Small - Large MidValue MidGrowth SmValue SmGrowth Value - Growth S&P/BARRA Style Indices Vanguard Equity-Income Adm Vanguard Morgan Growth Admiral Vanguard PRIMECAP Inv Vanguard Mid-Cap Value Index Admiral Target Small Capitalization Value T Vanguard REIT Index I City of Dover, Delaware Police Pension Plan 14 DOCUMENT PAGE 17

Quarterly Investment Monitor Data as of 06/30/2014 International Equity Style Map 36 Month moving average, Jul-09 - Jun-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 15 DOCUMENT PAGE 18

Quarterly Investment Monitor Data as of 06/30/2014 Core Fund Review City of Dover, Delaware Police Pension Plan 16 DOCUMENT PAGE 19

Quarterly Investment Monitor Data as of 06/30/2014 Vanguard Short-Term Bond Index Signal 5.07 Portfolio Information % Cash Investment Strategy Summary 12.14 Ticker VBSSX % US Stocks Morningstar Category Short-term Bond % Bonds The investment seeks to track the performance of a market-weighted bond index with a Avg Mkt Cap $MM NA % Non-US Stocks short-term dollar-weighted average maturity. The fund employs an indexing investment Cat Med Mkt Cap $MM 32024.02 approach designed to track the performance of the Barclays U.S. 1-5 Year % Pref Net Assets $MM 36264.18 Government/Credit Float Adjusted Index. This Index includes all medium and larger issues % Conv Turnover Ratio 50.00 of U.S. government, investment-grade corporate, and investment-grade international % Other % Assets in Top 10 Holdings 12.93 dollar-denominated bonds that have maturities between 1 and 5 years and are publicly % Non-US Bonds Total Number of Holdings 1967.00 issued. All of the fund's investments will be selected through the sampling process, and at Manager Name Joshua C. Barrickman least 80% of the fund's assets will be invested in bonds held in the index. Manager Tenure 1.35 82.74 _______________________________________________________________________ Fund Incept Date 03/01/1994 __ Prospectus Exp Ratio 0.10 Portfolio Region Portfolio Structure Phone Number 800-662-7447 Performance vs. Peer Group % United States NA % Cash 5.07 7 % Canada NA % US Stocks 0.00 % Latin America NA % Bonds 82.74 % United Kingdom NA % Non-US Stocks 0.00 6 % Eurozone NA % Pref 0.05 Portfolio Ratings % Europe - ex Euro NA % Conv 0.00 Mstar Rating Total Annualized Return, % % Europe - Emerging NA % Other 0.00 3 Year Mstar Rating 5 % Africa NA % Non-US Bonds 12.14 % Rank Cat 3 Yr 59 % Middle East NA 5 Year Mstar Rating % Japan NA % Rank Cat 5 Yr 64 4 % Australasia NA 10 Year Mstar Rating % Asia - Developed NA % Rank Cat 10 Yr 33 % Asia - Emerging NA 3 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 2 2 250 % Basic Materials NA Avg Eff Duration 2.70 % Communication Services NA Effective Maturity 2.80 % Consumer Cyclical NA Avg Credit Quality AA 225 1 % Consumer Defensive NA AAA 73.54 % Healthcare NA AA 4.65 200 0 % Industrials NA A 12.04 3 Months YTD 1 Year 3 Years 5 Years % Real Estate NA BBB 9.77 175 % Technology NA BB 0.00 5th to 25th Percentile 25th to Median % Energy NA B 0.00 Prospectus Exp Ratio 150 Median to 75th Percentile 75th to 95th Percentile Ratio % Financial Services NA Below B 0.00 Vanguard Short-Term Bond Index Signal Barclays US Govt/Credit 1-3 Yr TR USD % Utilities NA NR/NA 0.00 1 125 Turnover 100 Performance 3 Year to 1 3 5 Top Ten Holdings Months Date Year Years Years US Treasury Note 1.5% 1.73% 75 Vanguard Short-Term Bond Index Signal 0.58 0.98 1.69 1.53 2.53 US Treasury Note 0.625% 1.49% Barclays US Govt/Credit 1-3 Yr TR USD 0.33 0.56 1.14 1.00 1.73 US Treasury Note 2.125% 1.43% 50 Universe(5%) 1.45 2.88 4.84 4.06 6.11 US Treasury Note 1.25% 1.37% Universe(25%) 0.82 1.62 2.76 2.49 3.90 US Treasury Note 0.625% 1.22% Universe(Median) 0.56 1.06 2.01 1.81 3.15 US Treasury Note 1.5% 1.22% 25 Universe(75%) 0.39 0.77 1.50 1.30 2.37 US Treasury Note 0.625% 1.18% Universe(95%) 0.03 0.42 0.74 0.52 1.04 US Treasury Note 0.625% 1.12% 0 0 US Treasury Note 0.375% 1.09% Prospectus Exp Ratio Turnover Ratio US Treasury Note 0.75% 1.09% City of Dover, Delaware Police Pension Plan 17 DOCUMENT PAGE 20

Quarterly Investment Monitor Data as of 06/30/2014 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 5 Total Return, % 75 0 -5 100 Jul-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Jun-14 -10 Up/Down Market Capture Ratio -15 Jul-11 - Jun-14 500 -20 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 400 Up Mkt Capture Ratio, % Vanguard Short-Term Bond Index Signal Barclays US Govt/Credit 1-3 Yr TR USD 300 Annual Return % 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 200 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 0.64 100 0 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 2 3 3 3 -100 -100 0 100 200 300 400 500 600 Down Mkt Capture Ratio, % 1 Morningstar Short Term Bond Universe Vanguard Short-Term Bond Index Signal Total Annualized StdDev, % Excess Annualized StdDev, % 2 2 2 Barclays US Govt/Credit 1-3 Yr TR USD Alpha, % Sharpe Ratio 0 Return vs. Risk 1 1 1 Jul-11 - Jun-14 -1 6 5 Total Annualized Return, % 4 -2 0 0 0 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 3 Vanguard Short-Term Bond Index Signal Barclays US Govt/Credit 1-3 Yr TR USD 2 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 0 Vanguard Short-Term Bond Index Signal -0.50 2.11 88.41 1.32 1.09 0.66 -1 Barclays US Govt/Credit 1-3 Yr TR USD 0.00 1.00 100.00 1.90 0.48 0.00 Universe(5%) 1.65 3.72 81.68 2.36 2.57 2.41 -2 0 1 2 3 4 5 Universe(25%) 0.43 2.30 69.35 1.73 1.72 1.44 Total Annualized StdDev, % Universe(Median) -0.04 1.76 60.27 1.37 1.18 0.88 Universe(75%) -0.42 1.38 42.98 1.19 0.91 0.64 Morningstar Short Term Bond Universe Vanguard Short-Term Bond Index Signal Universe(95%) -1.21 0.94 23.08 0.53 0.62 0.33 Cash Barclays US Govt/Credit 1-3 Yr TR USD City of Dover, Delaware Police Pension Plan 18 DOCUMENT PAGE 21

Quarterly Investment Monitor Data as of 06/30/2014 Vanguard Inflation-Protected Secs I 1.43 Portfolio Information Investment Strategy Summary % Cash Ticker VIPIX % US Stocks Morningstar Category Inflation-Protected Bond % Bonds The investment seeks to provide inflation protection and income consistent with Avg Mkt Cap $MM NA % Non-US Stocks investment in inflation-indexed securities. The fund invests at least 80% of its assets in Cat Med Mkt Cap $MM 10678.54 inflation-indexed bonds issued by the U.S. government, its agencies and instrumentalities, % Pref Net Assets $MM 26220.27 and corporations. It may invest in bonds of any maturity; however, its dollar-weighted % Conv Turnover Ratio 44.00 average maturity is expected to be in the range of 7 to 20 years. At a minimum, all bonds % Other % Assets in Top 10 Holdings 48.78 purchased by the fund will be rated investment-grade or, if unrated, will be considered by % Non-US Bonds Total Number of Holdings 35.00 the advisor to be investment-grade. Manager Name Gemma Wright-Casparius _______________________________________________________________________ Manager Tenure 2.87 98.57 __ Fund Incept Date 06/29/2000 Prospectus Exp Ratio 0.07 Portfolio Region Portfolio Structure Phone Number 800-662-7447 Performance vs. Peer Group % United States NA % Cash 1.43 7 % Canada NA % US Stocks 0.00 % Latin America NA % Bonds 98.57 % United Kingdom NA % Non-US Stocks 0.00 6 % Eurozone NA % Pref 0.00 Portfolio Ratings % Europe - ex Euro NA % Conv 0.00 Mstar Rating Total Annualized Return, % % Europe - Emerging NA % Other 0.00 3 Year Mstar Rating 5 % Africa NA % Non-US Bonds 0.00 % Rank Cat 3 Yr 10 % Middle East NA 5 Year Mstar Rating % Japan NA % Rank Cat 5 Yr 17 4 % Australasia NA 10 Year Mstar Rating % Asia - Developed NA % Rank Cat 10 Yr 17 % Asia - Emerging NA 3 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 2 1.1 400 % Basic Materials NA Avg Eff Duration 7.85 % Communication Services NA Effective Maturity 8.40 1.0 1 % Consumer Cyclical NA Avg Credit Quality Government 350 % Consumer Defensive NA AAA 100.00 0.9 % Healthcare NA AA 0.00 0 % Industrials NA A 0.00 300 3 Months YTD 1 Year 3 Years 5 Years 0.8 % Real Estate NA BBB 0.00 % Technology NA BB 0.00 0.7 250 5th to 25th Percentile 25th to Median % Energy NA B 0.00 Prospectus Exp Ratio Median to 75th Percentile 75th to 95th Percentile Ratio % Financial Services NA Below B 0.00 0.6 Vanguard Inflation-Protected Secs I Barclays US Treasury US TIPS TR USD % Utilities NA NR/NA 0.00 200 Turnover 0.5 Performance 3 Year to 1 3 5 Top Ten Holdings 0.4 150 Months Date Year Years Years US Treasury TIP 6.10% Vanguard Inflation-Protected Secs I 3.75 5.91 4.47 3.56 5.50 US Treasury TIP 5.85% 0.3 100 Barclays US Treasury US TIPS TR USD 3.81 5.83 4.44 3.55 5.55 US Treasury TIP 5.41% Universe(5%) 4.25 6.60 5.67 3.72 6.12 US Treasury TIP 4.79% 0.2 Universe(25%) 3.75 5.71 4.59 3.35 5.54 US Treasury TIP 4.76% 50 Universe(Median) 3.59 5.47 4.01 3.13 5.11 US TREASURY TIP 4.73% 0.1 Universe(75%) 3.00 4.39 3.54 2.46 4.81 US Treasury TIP 0.125% 4.62% Universe(95%) 1.72 1.84 2.06 1.21 3.61 US Treasury TIP 4.43% 0.0 0 US Treasury TIP 1.125% 4.29% Prospectus Exp Ratio Turnover Ratio US TREASURY TIP 3.79% City of Dover, Delaware Police Pension Plan 19 DOCUMENT PAGE 22

Quarterly Investment Monitor Data as of 06/30/2014 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 Jul-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Jun-14 -5 Up/Down Market Capture Ratio -10 Jul-11 - Jun-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 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 20 1 0.8 7 5 0 0 20 40 60 80 100 120 140 160 180 200 0.7 6 Down Mkt Capture Ratio, % 4 0.6 Morningstar Inflation Proteced Bond Universe Vanguard Inflation-Protected Secs I Excess Annualized StdDev, % 5 Total Annualized StdDev, % Barclays US Treasury US TIPS TR USD 0.5 3 Sharpe Ratio 4 Alpha, % 0 0.4 3 Return vs. Risk 2 0.3 2 Jul-11 - Jun-14 0.2 7 1 1 6 0.1 Total Annualized Return, % 5 -1 0.0 0 0 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 4 Vanguard Inflation-Protected Secs I Barclays US Treasury US TIPS TR USD 3 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 2 Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error 1 Vanguard Inflation-Protected Secs I -0.08 1.03 99.24 0.63 5.67 0.52 0 Barclays US Treasury US TIPS TR USD 0.00 1.00 100.00 0.65 5.49 0.00 Universe(5%) 0.47 1.08 99.71 0.71 6.03 4.60 -1 0 1 2 3 4 5 6 7 8 9 10 11 Universe(25%) -0.03 1.01 99.43 0.63 5.57 1.79 Total Annualized StdDev, % Universe(Median) -0.24 0.95 98.49 0.59 5.28 0.73 Universe(75%) -0.45 0.92 93.03 0.55 5.10 0.51 Morningstar Inflation Proteced Bond Universe Vanguard Inflation-Protected Secs I Universe(95%) -0.89 0.32 55.71 0.35 2.42 0.31 Cash Barclays US Treasury US TIPS TR USD City of Dover, Delaware Police Pension Plan 20 DOCUMENT PAGE 23

Quarterly Investment Monitor Data as of 06/30/2014 Vanguard Interm-Term Bond Index Signal Portfolio Information Investment Strategy Summary % Cash 13.96 Ticker VIBSX % US Stocks Morningstar Category Intermediate-term Bond % Bonds The investment seeks the performance of a market-weighted bond index with an Avg Mkt Cap $MM NA % Non-US Stocks intermediate-term dollar-weighted average maturity. The fund employs an indexing Cat Med Mkt Cap $MM 105978.94 investment approach designed to track the performance of the Barclays U.S. 5-10 Year % Pref Net Assets $MM 15110.73 Government/Credit Float Adjusted Index. This Index includes all medium and larger issues % Conv Turnover Ratio 70.00 of U.S. government, investment-grade corporate, and investment-grade international % Other % Assets in Top 10 Holdings 23.11 dollar-denominated bonds that have maturities between 5 and 10 years and are publicly % Non-US Bonds Total Number of Holdings 1552.00 issued. All of the fund's investments will be selected through the sampling process, and at Manager Name Joshua C. Barrickman least 80% of the fund's assets will be invested in bonds held in the index. 85.32 Manager Tenure 6.18 _______________________________________________________________________ Fund Incept Date 03/01/1994 __ Prospectus Exp Ratio 0.10 Portfolio Region Portfolio Structure Phone Number 800-662-7447 Performance vs. Peer Group % United States NA % Cash 0.72 7 % Canada NA % US Stocks 0.00 % Latin America NA % Bonds 85.32 % United Kingdom NA % Non-US Stocks 0.00 6 % Eurozone NA % Pref 0.00 Portfolio Ratings % Europe - ex Euro NA % Conv 0.00 Mstar Rating Total Annualized Return, % % Europe - Emerging NA % Other 0.00 3 Year Mstar Rating 5 % Africa NA % Non-US Bonds 13.96 % Rank Cat 3 Yr 20 % Middle East NA 5 Year Mstar Rating % Japan NA % Rank Cat 5 Yr 31 4 % Australasia NA 10 Year Mstar Rating % Asia - Developed NA % Rank Cat 10 Yr 13 % Asia - Emerging NA 3 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 2 0.7 350 % Basic Materials NA Avg Eff Duration 6.51 % Communication Services NA Effective Maturity 7.30 % Consumer Cyclical NA Avg Credit Quality A 1 % Consumer Defensive NA AAA 53.74 0.6 300 % Healthcare NA AA 4.55 0 % Industrials NA A 17.78 3 Months YTD 1 Year 3 Years 5 Years % Real Estate NA BBB 23.93 0.5 250 % Technology NA BB 0.00 5th to 25th Percentile 25th to Median % Energy NA B 0.00 Prospectus Exp Ratio Median to 75th Percentile 75th to 95th Percentile Ratio % Financial Services NA Below B 0.00 0.4 200 Vanguard Interm-Term Bond Index Signal Barclays US Govt 5-10 Yr TR USD % Utilities NA NR/NA 0.00 0.3 Turnover 150 Performance 3 Year to 1 3 5 Top Ten Holdings Months Date Year Years Years US Treasury Note 2.5% 3.86% Vanguard Interm-Term Bond Index Signal 2.42 4.99 5.17 5.05 6.75 US Treasury Note 2% 2.94% 0.2 100 Barclays US Govt 5-10 Yr TR USD 2.04 3.88 2.63 3.89 4.99 US Treasury Note 3.5% 2.76% Universe(5%) 2.16 4.22 4.50 3.89 5.35 US Treasury Note 3.625% 2.52% Universe(25%) 2.05 3.91 4.21 3.48 4.63 US Treasury Note 2.75% 2.18% 0.1 50 Universe(Median) 2.00 3.88 4.16 3.43 4.53 US Treasury Note 1.75% 2.04% Universe(75%) 1.96 3.85 4.11 3.24 4.43 US Treasury Note 3.125% 1.73% Universe(95%) 1.89 3.73 3.82 3.15 4.30 US Treasury Note 3.625% 1.73% 0.0 0 US Treasury Note 3.625% 1.73% Prospectus Exp Ratio Turnover Ratio US Treasury Note 2.5% 1.62% City of Dover, Delaware Police Pension Plan 21 DOCUMENT PAGE 24

Quarterly Investment Monitor Data as of 06/30/2014 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 8 Total Return, % 6 75 4 2 100 Jul-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Jun-14 0 -2 Up/Down Market Capture Ratio -4 Jul-11 - Jun-14 100 -6 90 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 80 Up Mkt Capture Ratio, % Vanguard Interm-Term Bond Index Signal Barclays US Govt 5-10 Yr TR USD 70 60 Annual Return % 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 50 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 40 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 30 20 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 10 2 2 5 3 0 0 10 20 30 40 50 60 70 80 90 100 Down Mkt Capture Ratio, % 4 Morningstar IntermTerm Bond Index Universe Vanguard Interm-Term Bond Index Signal Total Annualized StdDev, % Excess Annualized StdDev, % 2 Barclays US Govt 5-10 Yr TR USD 3 Alpha, % Sharpe Ratio 1 1 2 Return vs. Risk 1 Jul-11 - Jun-14 6 1 5 Total Annualized Return, % 0 0 0 0 4 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 3 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 2 Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error Vanguard Interm-Term Bond Index Signal 1.71 0.84 82.79 1.13 4.37 1.96 1 Barclays US Govt 5-10 Yr TR USD 0.00 1.00 100.00 0.82 4.72 0.00 Universe(5%) 1.38 0.63 88.26 1.23 3.24 2.43 0 0 1 2 3 4 5 Universe(25%) 1.27 0.55 85.69 1.20 2.82 2.42 Total Annualized StdDev, % Universe(Median) 1.24 0.55 85.25 1.19 2.78 2.40 Universe(75%) 1.07 0.54 84.35 1.12 2.77 2.38 Morningstar IntermTerm Bond Index Universe Vanguard Interm-Term Bond Index Signal Universe(95%) 0.95 0.54 82.63 1.10 2.75 2.21 Cash Barclays US Govt 5-10 Yr TR USD City of Dover, Delaware Police Pension Plan 22 DOCUMENT PAGE 25

Quarterly Investment Monitor Data as of 06/30/2014 Vanguard Long-Term Bond Index I Portfolio Information Investment Strategy Summary % Cash 14.32 Ticker VBLLX % US Stocks Morningstar Category Long-term Bond % Bonds The investment seeks to track the performance of a market-weighted bond index with a Avg Mkt Cap $MM NA % Non-US Stocks long-term dollar-weighted average maturity. The fund employs an indexing investment Cat Med Mkt Cap $MM NA approach designed to track the performance of the Barclays U.S. Long Government/Credit % Pref Net Assets $MM 6730.75 Float Adjusted Index. This Index includes all medium and larger issues of U.S. % Conv Turnover Ratio 50.00 government, investment-grade corporate, and investment-grade international % Other % Assets in Top 10 Holdings 15.85 dollar-denominated bonds that have maturities of greater than 10 years and are publicly % Non-US Bonds Total Number of Holdings 1727.00 issued. All of the fund's investments will be selected through the sampling process, and at Manager Name Joshua C. Barrickman least 80% of the fund's assets will be invested in bonds held in the index. 84.82 Manager Tenure 1.35 _______________________________________________________________________ Fund Incept Date 03/01/1994 __ Prospectus Exp Ratio 0.07 Portfolio Region Portfolio Structure Phone Number 800-662-7447 Performance vs. Peer Group % United States NA % Cash 0.83 14 % Canada NA % US Stocks 0.00 % Latin America NA % Bonds 84.82 % United Kingdom NA % Non-US Stocks 0.00 12 % Eurozone NA % Pref 0.03 Portfolio Ratings % Europe - ex Euro NA % Conv 0.00 Mstar Rating Total Annualized Return, % % Europe - Emerging NA % Other 0.00 3 Year Mstar Rating 10 % Africa NA % Non-US Bonds 14.32 % Rank Cat 3 Yr 1 % Middle East NA 5 Year Mstar Rating % Japan NA % Rank Cat 5 Yr 39 8 % Australasia NA 10 Year Mstar Rating NA % Asia - Developed NA % Rank Cat 10 Yr 1 % Asia - Emerging NA 6 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 4 2 160 % Basic Materials NA Avg Eff Duration 14.20 % Communication Services NA Effective Maturity 24.00 % Consumer Cyclical NA Avg Credit Quality A 2 140 % Consumer Defensive NA AAA 36.86 % Healthcare NA AA 7.14 0 % Industrials NA A 25.33 120 3 Months YTD 1 Year 3 Years 5 Years % Real Estate NA BBB 30.67 % Technology NA BB 0.00 100 5th to 25th Percentile 25th to Median % Energy NA B 0.00 Prospectus Exp Ratio Median to 75th Percentile 75th to 95th Percentile Ratio % Financial Services NA Below B 0.00 Vanguard Long-Term Bond Index I BC Long Government/Credit % Utilities NA NR/NA 0.00 1 80 Turnover Performance 3 Year to 1 3 5 Top Ten Holdings 60 Months Date Year Years Years US Treasury Bond 3.625% 2.41% Vanguard Long-Term Bond Index I 4.84 12.14 10.55 9.55 9.56 US Treasury Bond 3.125% 1.89% 40 BC Long Government/Credit 4.93 11.81 10.77 9.57 9.60 US Treasury Bond 3.75% 1.81% Universe(5%) 5.10 11.99 11.03 9.43 10.58 US Treasury Bond 2.75% 1.76% Universe(25%) 4.18 10.04 9.81 8.85 9.96 US Treasury Bond 4.25% 1.64% 20 Universe(Median) 2.87 7.17 7.23 7.94 9.36 US Treasury Bond 2.75% 1.58% Universe(75%) 2.25 5.77 5.47 5.72 6.44 US Treasury Bond 4.75% 1.28% Universe(95%) 1.54 2.94 1.42 3.36 4.04 US Treasury Bond 4.375% 1.20% 0 0 US Treasury Bond 3.625% 1.18% Prospectus Exp Ratio Turnover Ratio US Treasury Bond 3% 1.10% City of Dover, Delaware Police Pension Plan 23 DOCUMENT PAGE 26

Quarterly Investment Monitor Data as of 06/30/2014 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 5 Total Return, % 0 75 -5 -10 100 Jul-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Jun-14 -15 -20 Up/Down Market Capture Ratio -25 Jul-11 - Jun-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 10 8 0 -20 0 20 40 60 80 100 120 9 7 Down Mkt Capture Ratio, % 4 8 6 Morningstar Long Term Bond Universe Vanguard Long-Term Bond Index I Total Annualized StdDev, % Excess Annualized StdDev, % 7 3 BC Long Government/Credit 5 6 Alpha, % Sharpe Ratio 2 1 5 4 4 Return vs. Risk 3 1 3 Jul-11 - Jun-14 2 10 2 0 9 1 1 Total Annualized Return, % 8 -1 0 0 0 7 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 6 Vanguard Long-Term Bond Index I BC Long Government/Credit 5 4 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr Statistics 3 Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error Vanguard Long-Term Bond Index I -0.19 1.02 99.10 1.02 9.32 0.90 2 BC Long Government/Credit 0.00 1.00 100.00 1.04 9.10 0.00 1 Universe(5%) 4.13 0.98 98.15 1.58 8.99 7.95 0 0 1 2 3 4 5 6 7 8 9 10 Universe(25%) 2.22 0.91 94.36 1.30 8.48 5.50 Total Annualized StdDev, % Universe(Median) 0.42 0.58 82.11 1.07 6.15 4.72 Universe(75%) 0.11 0.44 74.70 1.02 4.55 2.19 Morningstar Long Term Bond Universe Vanguard Long-Term Bond Index I Universe(95%) -0.75 0.18 36.21 0.77 3.37 1.23 Cash BC Long Government/Credit City of Dover, Delaware Police Pension Plan 24 DOCUMENT PAGE 27

Quarterly Investment Monitor Data as of 06/30/2014 PIMCO Long Duration Total Return Instl 5.64 Portfolio Information % Cash Investment Strategy Summary Ticker PLRIX % US Stocks 27.25 Morningstar Category Long-term Bond % Bonds The investment seeks maximum total return, consistent with prudent investment Avg Mkt Cap $MM NA % Non-US Stocks management. The fund invests at least 65% of its total assets in a diversified portfolio of Cat Med Mkt Cap $MM NA Fixed Income Instruments of varying maturities, which may be represented by forwards or % Pref Net Assets $MM 4750.70 derivatives such as options, futures contracts or swap agreements. It invests primarily in % Conv Turnover Ratio 70.00 investment grade debt securities, but may invest up to 10% of its total assets in high yield % Other % Assets in Top 10 Holdings 39.42 securities ("junk bonds") that are rated B or higher by Moody's, or equivalently rated by % Non-US Bonds Total Number of Holdings 739.00 S&P or Fitch, or, if unrated, determined by PIMCO to be of comparable quality. 66.17 Manager Name Stephen A. Rodosky _______________________________________________________________________ Manager Tenure 6.92 __ Fund Incept Date 08/31/2006 Prospectus Exp Ratio 0.50 Portfolio Region Portfolio Structure Phone Number 888-877-4626 Performance vs. Peer Group % United States 100.00 % Cash 5.64 12 % Canada 0.00 % US Stocks 0.01 % Latin America 0.00 % Bonds 66.17 % United Kingdom 0.00 % Non-US Stocks 0.00 10 % Eurozone 0.00 % Pref 0.34 Portfolio Ratings % Europe - ex Euro 0.00 % Conv 0.00 Mstar Rating Total Annualized Return, % % Europe - Emerging 0.00 % Other 0.59 3 Year Mstar Rating % Africa 0.00 % Non-US Bonds 27.25 % Rank Cat 3 Yr 16 8 % Middle East 0.00 5 Year Mstar Rating % Japan 0.00 % Rank Cat 5 Yr 23 % Australasia 0.00 10 Year Mstar Rating NA 6 % Asia - Developed 0.00 % Rank Cat 10 Yr NA % Asia - Emerging 0.00 4 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 2 160 % Basic Materials 0.00 Avg Eff Duration 13.16 % Communication Services 0.00 Effective Maturity 20.61 2 % Consumer Cyclical 0.00 Avg Credit Quality NA 140 % Consumer Defensive 0.00 AAA NA % Healthcare 0.00 AA NA 0 % Industrials 0.00 A NA 120 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 0.00 BBB NA % Technology 0.00 BB NA 100 5th to 25th Percentile 25th to Median % Energy 0.00 B NA Prospectus Exp Ratio Median to 75th Percentile 75th to 95th Percentile Ratio % Financial Services 31.29 Below B NA PIMCO Long Duration Total Return Instl BC Long Government/Credit % Utilities 68.71 NR/NA NA 1 80 Turnover Performance 3 Year to 1 3 5 Top Ten Holdings 60 Months Date Year Years Years Fin Fut Euro$ Cme 06/15/15 19.60% PIMCO Long Duration Total Return Instl 5.02 11.93 10.96 8.79 9.91 US Treasury Bond 2.75% 3.42% 40 BC Long Government/Credit 4.93 11.81 10.77 9.57 9.60 US Treasury Bond 3.125% 2.65% Universe(5%) 5.10 11.99 11.03 9.43 10.58 US Treasury Bond 3.125% 2.63% Universe(25%) 4.18 10.04 9.81 8.85 9.96 US Treasury Bond 3.75% 2.46% 20 Universe(Median) 2.87 7.17 7.23 7.94 9.36 U S Treas Bd Stripped Prin Pmt 1.94% Universe(75%) 2.25 5.77 5.47 5.72 6.44 Resolution Fdg Fed Bk Prin Stp 1.82% Universe(95%) 1.54 2.94 1.42 3.36 4.04 AID 5.5% 1.64% 0 0 FNMA 1.64% Prospectus Exp Ratio Turnover Ratio Resolution Fdg Fed Bk Prin Stp 1.61% City of Dover, Delaware Police Pension Plan 25 DOCUMENT PAGE 28

Quarterly Investment Monitor Data as of 06/30/2014 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 5 Total Return, % 0 75 -5 -10 100 Jul-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Jun-14 -15 -20 Up/Down Market Capture Ratio -25 Jul-11 - Jun-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 10 8 0 -20 0 20 40 60 80 100 120 9 7 Down Mkt Capture Ratio, % 4 8 6 Morningstar Long Term Bond Universe PIMCO Long Duration Total Return Instl Total Annualized StdDev, % Excess Annualized StdDev, % 7 3 BC Long Government/Credit 5 6 Alpha, % Sharpe Ratio 2 1 5 4 4 Return vs. Risk 3 1 3 Jul-11 - Jun-14 2 10 2 0 9 1 1 Total Annualized Return, % 8 -1 0 0 0 7 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 6 PIMCO Long Duration Total Return Instl BC Long Government/Credit 5 4 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr Statistics 3 Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error PIMCO Long Duration Total Return Instl 0.11 0.91 94.27 1.03 8.51 2.20 2 BC Long Government/Credit 0.00 1.00 100.00 1.04 9.10 0.00 1 Universe(5%) 4.13 0.98 98.15 1.58 8.99 7.95 0 0 1 2 3 4 5 6 7 8 9 10 Universe(25%) 2.22 0.91 94.36 1.30 8.48 5.50 Total Annualized StdDev, % Universe(Median) 0.42 0.58 82.11 1.07 6.15 4.72 Universe(75%) 0.11 0.44 74.70 1.02 4.55 2.19 Morningstar Long Term Bond Universe PIMCO Long Duration Total Return Instl Universe(95%) -0.75 0.18 36.21 0.77 3.37 1.23 Cash BC Long Government/Credit City of Dover, Delaware Police Pension Plan 26 DOCUMENT PAGE 29

Quarterly Investment Monitor Data as of 06/30/2014 Ivy High Income I 4.09 Portfolio Information Investment Strategy Summary % Cash Ticker IVHIX % US Stocks Morningstar Category High Yield Bond % Bonds The investment seeks to provide total return through a combination of high current income Avg Mkt Cap $MM 76583.05 % Non-US Stocks and capital appreciation. The fund invests primarily in a diversified portfolio of high-yield, 50.23 Cat Med Mkt Cap $MM 15121.68 high-risk, fixed income securities, including secured and unsecured loan assignments, loan % Pref 39.71 Net Assets $MM 11739.67 participations and other loan instruments (loans), of U.S. and foreign issuers, the risks of % Conv Turnover Ratio 75.00 which are, in the judgment of the adviser consistent with the fund's objective. It invests % Other % Assets in Top 10 Holdings 13.01 primarily in lower quality debt securities, which include debt securities rated BBB+ or % Non-US Bonds Total Number of Holdings 414.00 lower. Manager Name William M. Nelson _______________________________________________________________________ Manager Tenure 0.61 __ 5.41 Fund Incept Date 07/31/1997 Prospectus Exp Ratio 0.70 Portfolio Region Portfolio Structure Phone Number 800-777-6472 Performance vs. Peer Group % United States 100.00 % Cash 4.09 16 % Canada 0.00 % US Stocks 0.43 % Latin America 0.00 % Bonds 50.23 14 % United Kingdom 0.00 % Non-US Stocks 0.00 % Eurozone 0.00 % Pref 0.02 Portfolio Ratings % Europe - ex Euro 0.00 % Conv 0.11 Mstar Rating Total Annualized Return, % 12 % Europe - Emerging 0.00 % Other 5.41 3 Year Mstar Rating % Africa 0.00 % Non-US Bonds 39.71 % Rank Cat 3 Yr 3 % Middle East 0.00 5 Year Mstar Rating 10 % Japan 0.00 % Rank Cat 5 Yr 12 % Australasia 0.00 10 Year Mstar Rating 8 % Asia - Developed 0.00 % Rank Cat 10 Yr 4 % Asia - Emerging 0.00 6 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 2 160 4 % Basic Materials 0.00 Avg Eff Duration 4.06 % Communication Services 100.00 Effective Maturity 4.76 % Consumer Cyclical 0.00 Avg Credit Quality B 2 140 % Consumer Defensive 0.00 AAA 0.00 % Healthcare 0.00 AA 0.04 0 % Industrials 0.00 A 1.03 120 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 0.00 BBB 1.93 % Technology 0.00 BB 21.47 100 5th to 25th Percentile 25th to Median % Energy 0.00 B 43.38 Prospectus Exp Ratio Median to 75th Percentile 75th to 95th Percentile Ratio % Financial Services 0.00 Below B 31.15 Ivy High Income I BC High Yield Corporate Bond % Utilities 0.00 NR/NA 1.00 1 80 Turnover Performance 3 Year to 1 3 5 Top Ten Holdings 60 Months Date Year Years Years Magic 2 Lien (Misys Plc) 2.06% Ivy High Income I 1.77 4.73 11.46 11.14 14.20 Laureate Educ 144A 9.25% 1.80% 40 BC High Yield Corporate Bond 2.41 5.46 11.73 9.48 13.98 Fmg (Fortesque) Tl New 1l 1.51% Universe(5%) 3.20 6.51 13.19 10.44 15.51 Formula 1 (Proj Green Ii) 1.44% Universe(25%) 2.51 5.56 11.63 9.07 13.62 Formula1-Delta 2 Sarl B 1.17% 20 Universe(Median) 2.23 5.14 10.91 8.50 12.79 Hd Sply 11.5% 1.14% Universe(75%) 1.92 4.58 10.10 7.81 11.83 Hilton Tl B2 1l 1.02% Universe(95%) 1.33 2.82 8.07 6.18 10.22 Onex Usi Acquisition 144A 7.75% 0.97% 0 0 Eagle Midco 144A 9% 0.95% Prospectus Exp Ratio Turnover Ratio Us Foods 8.5% 0.95% City of Dover, Delaware Police Pension Plan 27 DOCUMENT PAGE 30

Quarterly Investment Monitor Data as of 06/30/2014 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 Jul-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Jun-14 -20 Up/Down Market Capture Ratio Jul-11 - Jun-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 9 5 0 -20 0 20 40 60 80 100 120 140 160 8 3 Down Mkt Capture Ratio, % 4 7 2 Morningstar High Yield Universe Ivy High Income I Total Annualized StdDev, % Excess Annualized StdDev, % 2 6 BC High Yield Corporate Bond 1 3 Sharpe Ratio 5 Alpha, % 0 4 2 Return vs. Risk -1 1 3 Jul-11 - Jun-14 -2 14 2 1 -3 1 12 Total Annualized Return, % -4 0 0 0 10 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 8 Ivy High Income I BC High Yield Corporate Bond 6 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error 4 Ivy High Income I 3.72 0.75 95.14 2.16 4.92 1.92 2 BC High Yield Corporate Bond 0.00 1.00 100.00 1.44 6.39 0.00 Universe(5%) 2.42 1.25 99.23 1.86 8.63 4.14 0 0 2 4 6 8 10 12 14 16 Universe(25%) 0.25 1.08 98.70 1.43 6.99 2.16 Total Annualized StdDev, % Universe(Median) -0.66 1.00 96.96 1.32 6.42 1.29 Universe(75%) -1.45 0.88 92.60 1.21 5.77 0.86 Morningstar High Yield Universe Ivy High Income I Universe(95%) -3.51 0.61 79.03 0.84 4.12 0.66 Cash BC High Yield Corporate Bond City of Dover, Delaware Police Pension Plan 28 DOCUMENT PAGE 31

Quarterly Investment Monitor Data as of 06/30/2014 Vanguard Equity-Income Adm 2.76 Portfolio Information Investment Strategy Summary 12.29 % Cash Ticker VEIRX % US Stocks Morningstar Category Large Value % Bonds The investment seeks to provide an above-average level of current income and reasonable Avg Mkt Cap $MM 83110.63 % Non-US Stocks long-term capital appreciation. The fund invests mainly in common stocks of mid-size and Cat Med Mkt Cap $MM 84745.85 large companies whose stocks typically pay above-average levels of dividend income and % Pref Net Assets $MM 17698.96 are, in the opinion of the purchasing advisor, undervalued relative to other stocks. In % Conv Turnover Ratio 34.00 addition, the advisors generally look for companies that they believe are committed to % Other % Assets in Top 10 Holdings 30.89 paying dividends consistently. Under normal circumstances, the fund will invest at least % Non-US Bonds Total Number of Holdings 169.00 80% of its assets in equity securities. The fund uses multiple investment advisors. Manager Name James P. Stetler _______________________________________________________________________ 84.95 Manager Tenure 10.50 __ Fund Incept Date 03/21/1988 Prospectus Exp Ratio 0.21 Portfolio Region Portfolio Structure Phone Number 800-662-7447 Performance vs. Peer Group % United States 87.36 % Cash 2.76 30 % Canada 2.22 % US Stocks 84.95 % Latin America 0.00 % Bonds 0.00 % United Kingdom 4.15 % Non-US Stocks 12.29 25 % Eurozone 3.97 % Pref 0.00 Portfolio Ratings % Europe - ex Euro 2.29 % Conv 0.00 Mstar Rating Total Annualized Return, % % Europe - Emerging 0.00 % Other 0.00 3 Year Mstar Rating % Africa 0.00 % Non-US Bonds 0.00 % Rank Cat 3 Yr 5 20 % Middle East 0.00 5 Year Mstar Rating % Japan 0.00 % Rank Cat 5 Yr 6 % Australasia 0.00 10 Year Mstar Rating 15 % Asia - Developed 0.00 % Rank Cat 10 Yr 8 % Asia - Emerging 0.00 10 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 2 180 % Basic Materials 3.92 Avg Eff Duration NA % Communication Services 4.46 Effective Maturity NA 5 % Consumer Cyclical 5.67 Avg Credit Quality NA 160 % Consumer Defensive 12.71 AAA NA % Healthcare 12.91 AA NA 140 0 % Industrials 12.90 A NA 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 0.00 BBB NA % Technology 12.79 BB NA 120 5th to 25th Percentile 25th to Median % Energy 11.71 B NA Prospectus Exp Ratio Median to 75th Percentile 75th to 95th Percentile Ratio % Financial Services 16.29 Below B NA 100 Vanguard Equity-Income Adm S&P 500 Value % Utilities 6.63 NR/NA NA 1 Turnover 80 Performance 3 Year to 1 3 5 Top Ten Holdings Months Date Year Years Years Johnson & Johnson 4.03% 60 Vanguard Equity-Income Adm 5.18 7.64 21.57 17.42 19.82 Wells Fargo & Co 3.90% S&P 500 Value 4.60 6.96 21.99 16.25 18.52 Microsoft Corp 3.57% 40 Universe(5%) 6.08 9.03 27.79 18.24 20.69 Exxon Mobil Corporation 3.40% Universe(25%) 5.23 7.84 24.29 16.59 18.75 Verizon Communications Inc 3.03% 20 Universe(Median) 4.57 6.93 22.65 15.30 17.77 JPMorgan Chase & Co 2.99% Universe(75%) 3.96 5.84 21.02 14.09 16.58 Chevron Corp 2.90% Universe(95%) 2.72 4.03 16.52 11.07 14.16 Merck & Co Inc 2.85% 0 0 General Electric Co 2.23% Prospectus Exp Ratio Turnover Ratio Marsh & McLennan Companies Inc 2.00% City of Dover, Delaware Police Pension Plan 29 DOCUMENT PAGE 32

Quarterly Investment Monitor Data as of 06/30/2014 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 Jul-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Jun-14 -30 Up/Down Market Capture Ratio -40 Jul-11 - Jun-14 180 -50 160 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 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 5 2 16 7 0 0 20 40 60 80 100 120 140 160 180 4 14 Down Mkt Capture Ratio, % 6 3 12 Morningstar Large Value Universe Vanguard Equity-Income Adm Excess Annualized StdDev, % 5 Total Annualized StdDev, % 2 S&P 500 Value 10 1 Sharpe Ratio 4 Alpha, % 0 1 8 3 Return vs. Risk -1 6 -2 2 Jul-11 - Jun-14 4 25 -3 1 2 -4 Total Annualized Return, % 20 -5 0 0 0 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 15 Vanguard Equity-Income Adm S&P 500 Value 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 Vanguard Equity-Income Adm 4.36 0.77 92.64 1.58 10.56 4.16 5 S&P 500 Value 0.00 1.00 100.00 1.21 13.18 0.00 Universe(5%) 3.42 1.18 98.67 1.50 15.94 6.47 0 0 5 10 15 20 25 Universe(25%) 1.06 1.05 97.36 1.26 14.25 4.12 Total Annualized StdDev, % Universe(Median) -0.27 0.98 96.03 1.16 13.19 3.02 Universe(75%) -1.84 0.89 92.67 1.05 12.01 2.26 Morningstar Large Value Universe Vanguard Equity-Income Adm Universe(95%) -4.80 0.70 85.01 0.86 9.73 1.66 Cash S&P 500 Value City of Dover, Delaware Police Pension Plan 30 DOCUMENT PAGE 33

Quarterly Investment Monitor Data as of 06/30/2014 Vanguard Morgan Growth Admiral 5.54 Portfolio Information Investment Strategy Summary % Cash Ticker VMRAX % US Stocks Morningstar Category Large Growth % Bonds The investment seeks long-term growth of capital. The fund invests mainly in the stocks of Avg Mkt Cap $MM 36481.21 % Non-US Stocks mid- and large-capitalization U.S. companies whose revenues and/or earnings are Cat Med Mkt Cap $MM 70104.21 expected to grow faster than those of the average company in the market. It uses multiple % Pref Net Assets $MM 10932.61 investment advisors. % Conv Turnover Ratio 53.00 % Other % Assets in Top 10 Holdings 17.83 _______________________________________________________________________ % Non-US Bonds Total Number of Holdings 335.00 __ Manager Name James P. Stetler 92.97 Manager Tenure 10.50 Fund Incept Date 12/31/1968 Prospectus Exp Ratio 0.25 Portfolio Region Portfolio Structure Phone Number 800-662-7447 Performance vs. Peer Group % United States 94.37 % Cash 0.80 35 % Canada 0.69 % US Stocks 92.97 % Latin America 0.00 % Bonds 0.00 % United Kingdom 1.17 % Non-US Stocks 5.54 30 % Eurozone 2.02 % Pref 0.00 Portfolio Ratings % Europe - ex Euro 0.92 % Conv 0.00 Mstar Rating Total Annualized Return, % % Europe - Emerging 0.00 % Other 0.69 3 Year Mstar Rating 25 % Africa 0.00 % Non-US Bonds 0.00 % Rank Cat 3 Yr 57 % Middle East 0.68 5 Year Mstar Rating % Japan 0.00 % Rank Cat 5 Yr 34 20 % Australasia 0.00 10 Year Mstar Rating % Asia - Developed 0.14 % Rank Cat 10 Yr 41 % Asia - Emerging 0.00 15 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 10 2 300 % Basic Materials 2.15 Avg Eff Duration NA % Communication Services 2.56 Effective Maturity NA % Consumer Cyclical 16.91 Avg Credit Quality NA 5 % Consumer Defensive 3.60 AAA NA 250 % Healthcare 19.38 AA NA 0 % Industrials 14.83 A NA 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 0.38 BBB NA % Technology 28.19 BB NA 200 5th to 25th Percentile 25th to Median % Energy 4.43 B NA Prospectus Exp Ratio Median to 75th Percentile 75th to 95th Percentile Ratio % Financial Services 7.57 Below B NA Vanguard Morgan Growth Admiral S&P 500 Growth % Utilities 0.00 NR/NA NA 1 150 Turnover Performance 3 Year to 1 3 5 Top Ten Holdings Months Date Year Years Years Google Inc Class A 3.31% 100 Vanguard Morgan Growth Admiral 3.52 4.49 25.60 14.12 18.38 Microsoft Corp 2.41% S&P 500 Growth 5.82 7.29 27.13 16.96 19.19 Apple Inc 2.36% Universe(5%) 6.41 8.87 33.03 18.34 21.81 Oracle Corporation 1.69% 50 Universe(25%) 5.14 6.50 29.36 16.14 19.23 Facebook Inc Class A 1.61% Universe(Median) 4.39 5.02 26.40 14.64 17.87 Biogen Idec Inc 1.46% Universe(75%) 3.68 3.57 24.15 13.19 16.29 Gilead Sciences Inc 1.38% Universe(95%) 1.74 1.08 19.18 10.28 14.21 Qualcomm Inc 1.25% 0 0 Amgen Inc 1.24% Prospectus Exp Ratio Turnover Ratio MasterCard Inc Class A 1.12% City of Dover, Delaware Police Pension Plan 31 DOCUMENT PAGE 34

Quarterly Investment Monitor Data as of 06/30/2014 Vanguard Morgan Growth 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 Jul-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Jun-14 -40 Up/Down Market Capture Ratio Jul-11 - Jun-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 Morgan Growth Admiral S&P 500 Growth 200 Annual Return % 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 150 Vanguard Morgan Growth Admiral 10.61 9.31 11.32 11.36 -41.33 36.31 18.90 -2.42 15.25 34.92 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 1 2 18 9 0 0 25 50 75 100 125 150 175 200 225 250 0 16 8 Down Mkt Capture Ratio, % -1 14 7 Morningstar Large Growth Universe Vanguard Morgan Growth Admiral Excess Annualized StdDev, % -2 Total Annualized StdDev, % 12 6 S&P 500 Growth -3 Sharpe Ratio 10 5 Alpha, % -4 1 -5 8 4 Return vs. Risk -6 6 3 Jul-11 - Jun-14 -7 4 2 40 -8 2 1 35 Total Annualized Return, % -9 30 -10 0 0 0 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 25 Vanguard Morgan Growth Admiral S&P 500 Growth 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 Morgan Growth Admiral -5.43 1.20 93.35 0.97 14.68 4.48 5 S&P 500 Growth 0.00 1.00 100.00 1.39 11.79 0.00 Universe(5%) 0.23 1.34 96.81 1.34 17.19 8.61 0 0 5 10 15 20 25 30 Universe(25%) -2.56 1.23 93.87 1.14 15.28 5.66 Total Annualized StdDev, % Universe(Median) -4.20 1.16 91.60 1.04 14.34 4.76 Universe(75%) -5.92 1.09 87.65 0.92 13.44 3.72 Morningstar Large Growth Universe Vanguard Morgan Growth Admiral Universe(95%) -9.12 0.96 81.04 0.71 11.81 2.57 Cash S&P 500 Growth City of Dover, Delaware Police Pension Plan 32 DOCUMENT PAGE 35

Quarterly Investment Monitor Data as of 06/30/2014 Vanguard PRIMECAP Inv 4.07 Portfolio Information Investment Strategy Summary 12.14 % Cash Ticker VPMCX % US Stocks Morningstar Category Large Growth % Bonds The investment seeks long-term capital appreciation. The fund invests in stocks Avg Mkt Cap $MM 63080.26 % Non-US Stocks considered to have above-average earnings growth potential that is not reflected in their Cat Med Mkt Cap $MM 70104.21 current market prices. Its portfolio consists predominantly of large- and mid-capitalization % Pref Net Assets $MM 43417.26 stocks. % Conv Turnover Ratio 5.00 % Other % Assets in Top 10 Holdings 42.56 _______________________________________________________________________ % Non-US Bonds Total Number of Holdings 124.00 __ Manager Name Joel P. Fried 83.79 Manager Tenure 25.52 Fund Incept Date 11/01/1984 Prospectus Exp Ratio 0.45 Portfolio Region Portfolio Structure Phone Number 800-662-7447 Performance vs. Peer Group % United States 87.34 % Cash 4.07 35 % Canada 1.03 % US Stocks 83.79 % Latin America 0.03 % Bonds 0.00 % United Kingdom 0.66 % Non-US Stocks 12.14 30 % Eurozone 0.99 % Pref 0.00 Portfolio Ratings % Europe - ex Euro 9.46 % Conv 0.00 Mstar Rating Total Annualized Return, % % Europe - Emerging 0.00 % Other 0.00 3 Year Mstar Rating 25 % Africa 0.00 % Non-US Bonds 0.00 % Rank Cat 3 Yr 3 % Middle East 0.00 5 Year Mstar Rating % Japan 0.48 % Rank Cat 5 Yr 16 20 % Australasia 0.00 10 Year Mstar Rating % Asia - Developed 0.00 % Rank Cat 10 Yr 6 % Asia - Emerging 0.00 15 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 10 2 300 % Basic Materials 2.79 Avg Eff Duration NA % Communication Services 1.65 Effective Maturity NA % Consumer Cyclical 5.43 Avg Credit Quality NA 5 % Consumer Defensive 0.73 AAA NA 250 % Healthcare 31.86 AA NA 0 % Industrials 14.71 A NA 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 0.00 BBB NA % Technology 31.87 BB NA 200 5th to 25th Percentile 25th to Median % Energy 4.75 B NA Prospectus Exp Ratio Median to 75th Percentile 75th to 95th Percentile Ratio % Financial Services 6.21 Below B NA Vanguard PRIMECAP Inv S&P 500 Growth % Utilities 0.00 NR/NA NA 1 150 Turnover Performance 3 Year to 1 3 5 Top Ten Holdings Months Date Year Years Years Biogen Idec Inc 7.44% 100 Vanguard PRIMECAP Inv 4.63 9.89 30.34 18.09 19.56 Amgen Inc 4.75% S&P 500 Growth 5.82 7.29 27.13 16.96 19.19 Roche Holding AG 4.26% Universe(5%) 6.41 8.87 33.03 18.34 21.81 Eli Lilly and Co 4.13% 50 Universe(25%) 5.14 6.50 29.36 16.14 19.23 Texas Instruments Inc 3.92% Universe(Median) 4.39 5.02 26.40 14.64 17.87 Microsoft Corp 3.86% Universe(75%) 3.68 3.57 24.15 13.19 16.29 FedEx Corp 3.83% Universe(95%) 1.74 1.08 19.18 10.28 14.21 Google Inc Class A 3.81% 0 0 Adobe Systems Inc 3.70% Prospectus Exp Ratio Turnover Ratio Novartis AG ADR 2.85% City of Dover, Delaware Police Pension Plan 33 DOCUMENT PAGE 36

Quarterly Investment Monitor Data as of 06/30/2014 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 Jul-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Jun-14 -40 Up/Down Market Capture Ratio Jul-11 - Jun-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 1 2 18 9 0 0 25 50 75 100 125 150 175 200 225 250 0 16 8 Down Mkt Capture Ratio, % -1 14 7 Morningstar Large Growth Universe Vanguard PRIMECAP Inv Excess Annualized StdDev, % -2 Total Annualized StdDev, % 12 6 S&P 500 Growth -3 Sharpe Ratio 10 5 Alpha, % -4 1 -5 8 4 Return vs. Risk -6 6 3 Jul-11 - Jun-14 -7 4 2 40 -8 2 1 35 Total Annualized Return, % -9 30 -10 0 0 0 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 25 Vanguard PRIMECAP Inv S&P 500 Growth 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 PRIMECAP Inv 0.25 1.05 90.28 1.34 13.08 4.13 5 S&P 500 Growth 0.00 1.00 100.00 1.39 11.79 0.00 Universe(5%) 0.23 1.34 96.81 1.34 17.19 8.61 0 0 5 10 15 20 25 30 Universe(25%) -2.56 1.23 93.87 1.14 15.28 5.66 Total Annualized StdDev, % Universe(Median) -4.20 1.16 91.60 1.04 14.34 4.76 Universe(75%) -5.92 1.09 87.65 0.92 13.44 3.72 Morningstar Large Growth Universe Vanguard PRIMECAP Inv Universe(95%) -9.12 0.96 81.04 0.71 11.81 2.57 Cash S&P 500 Growth City of Dover, Delaware Police Pension Plan 34 DOCUMENT PAGE 37

Quarterly Investment Monitor Data as of 06/30/2014 Vanguard Mid-Cap Value Index Admiral 2.10 Portfolio Information Investment Strategy Summary % Cash Ticker VMVAX % US Stocks Morningstar Category Mid-Cap Value % Bonds The investment seeks to track the performance of a benchmark index that measures the Avg Mkt Cap $MM 9713.59 % Non-US Stocks investment return of mid-capitalization value stocks. The fund employs an indexing Cat Med Mkt Cap $MM 9131.58 investment approach designed to track the performance of the CRSP US Mid Cap Value % Pref Net Assets $MM 6005.93 Index, a broadly diversified index of value stocks of mid-size U.S. companies. It attempts % Conv Turnover Ratio 46.00 to replicate the target index by investing all, or substantially all, of its assets in the stocks % Other % Assets in Top 10 Holdings 11.06 that make up the index, holding each stock in approximately the same proportion as its % Non-US Bonds Total Number of Holdings 204.00 weighting in the index. Manager Name Donald M. Butler _______________________________________________________________________ Manager Tenure 7.87 97.62 __ Fund Incept Date 09/27/2011 Prospectus Exp Ratio 0.09 Portfolio Region Portfolio Structure Phone Number 800-662-7447 Performance vs. Peer Group % United States 97.89 % Cash 0.28 35 % Canada 0.00 % US Stocks 97.62 % Latin America 0.00 % Bonds 0.00 % United Kingdom 1.62 % Non-US Stocks 2.10 30 % Eurozone 0.00 % Pref 0.00 Portfolio Ratings % Europe - ex Euro 0.49 % Conv 0.00 Mstar Rating Total Annualized Return, % % Europe - Emerging 0.00 % Other 0.00 3 Year Mstar Rating 25 % Africa 0.00 % Non-US Bonds 0.00 % Rank Cat 3 Yr 12 % Middle East 0.00 5 Year Mstar Rating % Japan 0.00 % Rank Cat 5 Yr 10 20 % Australasia 0.00 10 Year Mstar Rating NA % Asia - Developed 0.00 % Rank Cat 10 Yr NA % Asia - Emerging 0.00 15 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 10 3 180 % Basic Materials 7.25 Avg Eff Duration NA % Communication Services 0.74 Effective Maturity NA % Consumer Cyclical 15.18 Avg Credit Quality NA 5 160 % Consumer Defensive 8.31 AAA NA % Healthcare 8.37 AA NA 140 0 % Industrials 11.36 A NA 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 4.43 BBB NA % Technology 9.74 BB NA 2 120 5th to 25th Percentile 25th to Median % Energy 6.73 B NA Prospectus Exp Ratio Median to 75th Percentile 75th to 95th Percentile Ratio % Financial Services 18.01 Below B NA 100 Vanguard Mid-Cap Value Index Admiral CRSP US Mid Cap Value TR USD % Utilities 9.87 NR/NA NA Turnover 80 Performance 3 Year to 1 3 5 Top Ten Holdings Months Date Year Years Years Delphi Automotive PLC 1.36% 1 60 Vanguard Mid-Cap Value Index Admiral 4.94 9.01 28.36 17.55 22.87 Western Digital Corp 1.27% CRSP US Mid Cap Value TR USD 4.97 9.07 28.49 18.17 23.32 Mylan Inc 1.19% 40 Universe(5%) 6.05 10.99 30.83 18.49 23.77 Boston Scientific Inc 1.09% Universe(25%) 5.27 8.96 27.27 16.90 21.74 AmerisourceBergen Corp 1.08% 20 Universe(Median) 4.83 7.80 25.25 15.39 20.29 Seagate Technology PLC 1.08% Universe(75%) 4.00 6.25 22.66 13.41 18.69 United Continental Holdings Inc 1.06% Universe(95%) 3.04 3.93 16.60 9.93 15.38 Nielsen NV 1.00% 0 0 Hartford Financial Services Group Inc 0.99% Prospectus Exp Ratio Turnover Ratio Alcoa Inc 0.94% City of Dover, Delaware Police Pension Plan 35 DOCUMENT PAGE 38

Quarterly Investment Monitor Data as of 06/30/2014 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 Jul-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Jun-14 -40 Up/Down Market Capture Ratio Jul-11 - Jun-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 2 2 18 8 0 0 20 40 60 80 100 120 140 160 180 1 16 7 Down Mkt Capture Ratio, % 0 14 6 Morningstar Midcap Value Universe Vanguard Mid-Cap Value Index Admiral Total Annualized StdDev, % Excess Annualized StdDev, % -1 12 CRSP US Mid Cap Value TR USD 5 -2 Sharpe Ratio 10 Alpha, % -3 1 4 8 -4 Return vs. Risk 3 6 -5 Jul-11 - Jun-14 2 25 4 -6 2 1 -7 Total Annualized Return, % 20 -8 0 0 0 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 15 Vanguard Mid-Cap Value Index Admiral CRSP US Mid Cap Value TR 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 Vanguard Mid-Cap Value Index Admiral -0.93 1.03 99.62 1.24 13.88 0.92 5 CRSP US Mid Cap Value TR USD 0.00 1.00 100.00 1.30 13.50 0.00 Universe(5%) 1.76 1.23 97.03 1.41 17.04 7.83 0 0 5 10 15 20 25 Universe(25%) -1.60 1.14 96.28 1.16 16.09 5.15 Total Annualized StdDev, % Universe(Median) -2.97 1.06 94.71 1.06 14.84 3.96 Universe(75%) -4.88 0.96 90.47 0.91 13.16 3.01 Morningstar Midcap Value Universe Vanguard Mid-Cap Value Index Admiral Universe(95%) -7.71 0.68 73.86 0.74 10.17 2.52 Cash CRSP US Mid Cap Value TR USD City of Dover, Delaware Police Pension Plan 36 DOCUMENT PAGE 39

Quarterly Investment Monitor Data as of 06/30/2014 Target Small Capitalization Value T 3.63 1.70 Portfolio Information Investment Strategy Summary % Cash Ticker TASVX % US Stocks Morningstar Category Small Value % Bonds The investment seeks above-average capital appreciation. The Portfolio seeks investments Avg Mkt Cap $MM 2135.50 % Non-US Stocks that will increase in value. It normally invests at least 80% of its investable assets in Cat Med Mkt Cap $MM 2544.89 common stocks of small companies. Small companies are those companies with market % Pref Net Assets $MM 2037.88 capitalizations comparable to those in the Russell 2000 Value Index. As of December 31, % Conv Turnover Ratio 40.00 2012, the Russell 2000 Value Index median market capitalization was approximately $472 % Other % Assets in Top 10 Holdings 7.06 million and the largest company by market capitalization was $4.664 billion. Market % Non-US Bonds Total Number of Holdings 816.00 capitalization is measured at the time of purchase. Manager Name Paul E. Viera _______________________________________________________________________ Manager Tenure 12.50 __ 94.35 Fund Incept Date 01/05/1993 Prospectus Exp Ratio 0.67 Portfolio Region Portfolio Structure Phone Number 800-225-1852 Performance vs. Peer Group % United States 98.23 % Cash 3.63 35 % Canada 0.70 % US Stocks 94.35 % Latin America 0.28 % Bonds 0.00 30 % United Kingdom 0.01 % Non-US Stocks 1.70 % Eurozone 0.56 % Pref 0.00 Portfolio Ratings % Europe - ex Euro 0.00 % Conv 0.00 Mstar Rating Total Annualized Return, % 25 % Europe - Emerging 0.00 % Other 0.32 3 Year Mstar Rating % Africa 0.00 % Non-US Bonds 0.00 % Rank Cat 3 Yr 48 % Middle East 0.21 5 Year Mstar Rating 20 % Japan 0.00 % Rank Cat 5 Yr 55 % Australasia 0.00 10 Year Mstar Rating 15 % Asia - Developed 0.00 % Rank Cat 10 Yr 9 % Asia - Emerging 0.00 10 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 2 200 5 % Basic Materials 5.06 Avg Eff Duration NA % Communication Services 0.88 Effective Maturity NA % Consumer Cyclical 10.76 Avg Credit Quality NA 180 0 % Consumer Defensive 3.75 AAA NA % Healthcare 6.62 AA NA 160 -5 % Industrials 21.10 A NA 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 5.50 BBB NA 140 % Technology 13.08 BB NA 5th to 25th Percentile 25th to Median % Energy 5.84 B NA Prospectus Exp Ratio 120 Median to 75th Percentile 75th to 95th Percentile Ratio % Financial Services 23.45 Below B NA Target Small Capitalization Value T S&P 600 Value % Utilities 3.98 NR/NA NA 1 100 Turnover 80 Performance 3 Year to 1 3 5 Top Ten Holdings Months Date Year Years Years Firstmerit Corp 0.83% 60 Target Small Capitalization Value T 3.46 4.81 23.64 14.68 20.09 Bristow Group Inc 0.76% S&P 600 Value 2.28 4.46 25.41 17.91 21.67 Teleflex Inc 0.74% 40 Universe(5%) 5.89 8.34 30.76 19.12 24.13 American Equity Investment Life Holding Co 0.70% Universe(25%) 3.56 5.58 25.82 16.02 21.93 EnerSys 0.69% Universe(Median) 2.77 4.50 23.75 14.87 20.33 Protective Life Corp 0.69% 20 Universe(75%) 1.41 2.84 21.46 13.57 19.03 GATX Corp 0.67% Universe(95%) -0.50 1.00 13.60 10.59 14.79 KAR Auction Services Inc 0.67% 0 0 Silgan Holdings Inc 0.67% Prospectus Exp Ratio Turnover Ratio Broadridge Financial Solutions 0.64% City of Dover, Delaware Police Pension Plan 37 DOCUMENT PAGE 40

Quarterly Investment Monitor Data as of 06/30/2014 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 Jul-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Jun-14 -40 Up/Down Market Capture Ratio Jul-11 - Jun-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 2 2 20 10 0 0 20 40 60 80 100 120 140 18 9 1 Down Mkt Capture Ratio, % 16 8 0 Morningstar SmallCap Value Universe Target Small Capitalization Value T Total Annualized StdDev, % Excess Annualized StdDev, % 14 7 S&P 600 Value -1 12 6 Alpha, % Sharpe Ratio -2 1 10 5 8 4 Return vs. Risk -3 6 3 Jul-11 - Jun-14 -4 25 4 2 -5 2 1 Total Annualized Return, % 20 -6 0 0 0 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 15 Target Small Capitalization Value T S&P 600 Value 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 Target Small Capitalization Value T -1.19 0.90 97.16 0.99 14.97 3.04 5 S&P 600 Value 0.00 1.00 100.00 1.08 16.45 0.00 Universe(5%) 1.91 1.14 98.23 1.15 19.00 9.58 0 0 5 10 15 20 25 Universe(25%) -0.92 1.05 97.11 0.99 17.65 5.10 Total Annualized StdDev, % Universe(Median) -1.95 0.97 95.41 0.95 16.19 3.89 Universe(75%) -3.21 0.90 92.25 0.86 15.34 2.98 Morningstar SmallCap Value Universe Target Small Capitalization Value T Universe(95%) -5.68 0.66 84.88 0.73 12.60 2.43 Cash S&P 600 Value City of Dover, Delaware Police Pension Plan 38 DOCUMENT PAGE 41

Quarterly Investment Monitor Data as of 06/30/2014 Oppenheimer International Growth Y 3.51 Portfolio Information Investment Strategy Summary % Cash Ticker OIGYX % US Stocks Morningstar Category Foreign Large Growth % Bonds The investment seeks capital appreciation. The fund mainly invests in the common stock Avg Mkt Cap $MM 15679.42 % Non-US Stocks of growth companies that are domiciled or have their primary operations outside of the Cat Med Mkt Cap $MM 32560.94 United States. It may invest 100% of its assets in securities of foreign companies. The % Pref Net Assets $MM 18753.14 fund may invest in emerging markets as well as in developed markets throughout the % Conv Turnover Ratio 12.00 world. It normally will invest at least 65% of its total assets in common and preferred % Other % Assets in Top 10 Holdings 14.45 stocks of issuers in at least three different countries outside of the United States, and % Non-US Bonds Total Number of Holdings 111.00 emphasize investments in common stocks of issuers that the portfolio managers consider Manager Name George R. Evans to be "growth" companies. Manager Tenure 18.28 _______________________________________________________________________ 95.48 Fund Incept Date 03/25/1996 __ Prospectus Exp Ratio 0.90 Portfolio Region Portfolio Structure Phone Number 800-225-5677 Performance vs. Peer Group % United States 1.04 % Cash 3.51 30 % Canada 1.22 % US Stocks 1.00 % Latin America 0.91 % Bonds 0.00 % United Kingdom 29.11 % Non-US Stocks 95.48 25 % Eurozone 35.69 % Pref 0.01 Portfolio Ratings % Europe - ex Euro 19.98 % Conv 0.00 Mstar Rating Total Annualized Return, % % Europe - Emerging 0.00 % Other 0.00 3 Year Mstar Rating 20 % Africa 0.00 % Non-US Bonds 0.00 % Rank Cat 3 Yr 4 % Middle East 0.00 5 Year Mstar Rating % Japan 4.93 % Rank Cat 5 Yr 4 15 % Australasia 3.94 10 Year Mstar Rating % Asia - Developed 0.00 % Rank Cat 10 Yr 1 % Asia - Emerging 3.18 10 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 5 2 180 % Basic Materials 4.98 Avg Eff Duration NA % Communication Services 7.46 Effective Maturity NA % Consumer Cyclical 18.02 Avg Credit Quality NA 0 160 % Consumer Defensive 15.55 AAA NA % Healthcare 10.70 AA NA 140 -5 % Industrials 21.18 A NA 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 0.00 BBB NA % Technology 14.90 BB NA 120 5th to 25th Percentile 25th to Median % Energy 2.52 B NA Prospectus Exp Ratio Median to 75th Percentile 75th to 95th Percentile Ratio % Financial Services 4.30 Below B NA 100 Oppenheimer International Growth Y MSCI EAFE Large Growth NR USD % Utilities 0.39 NR/NA NA 1 Turnover 80 Performance 3 Year to 1 3 5 Top Ten Holdings Months Date Year Years Years BT Group PLC 1.98% 60 Oppenheimer International Growth Y 1.35 2.38 20.93 10.58 15.60 Sap AG 1.62% MSCI EAFE Large Growth NR USD 3.64 3.11 19.56 7.66 12.03 Roche Holding AG 1.43% 40 Universe(5%) 5.62 7.84 27.52 10.57 15.12 Syngenta AG 1.41% Universe(25%) 4.70 5.29 23.72 8.19 12.89 Aalberts Industries NV 1.38% 20 Universe(Median) 3.89 4.15 21.56 7.00 11.55 Industria De Diseno Textil SA 1.36% Universe(75%) 3.04 2.81 19.50 5.68 10.38 Aryzta AG 1.34% Universe(95%) 1.43 -0.15 15.00 3.14 8.17 Unilever PLC 1.33% 0 0 William Hill PLC 1.31% Prospectus Exp Ratio Turnover Ratio Grifols SA Class A 1.28% City of Dover, Delaware Police Pension Plan 39 DOCUMENT PAGE 42

Quarterly Investment Monitor Data as of 06/30/2014 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 Jul-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Jun-14 -40 Up/Down Market Capture Ratio Jul-11 - Jun-14 225 -60 200 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 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 0.8 20 7 0 0 25 50 75 100 125 150 175 200 225 3 18 0.7 6 Down Mkt Capture Ratio, % 16 2 0.6 Morningstar Foreign Stock Universe Oppenheimer International Growth Y Excess Annualized StdDev, % 5 Total Annualized StdDev, % 14 1 MSCI EAFE Large Growth NR USD 0.5 12 Sharpe Ratio 0 4 Alpha, % 0.4 10 -1 3 8 Return vs. Risk 0.3 -2 6 2 Jul-11 - Jun-14 0.2 14 -3 4 1 12 -4 0.1 2 Total Annualized Return, % 10 -5 0.0 0 0 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 8 Oppenheimer International Growth Y MSCI EAFE Large Growth NR USD 6 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 4 Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error 2 Oppenheimer International Growth Y 3.16 0.93 94.33 0.73 15.39 3.81 0 MSCI EAFE Large Growth NR USD 0.00 1.00 100.00 0.54 15.99 0.00 Universe(5%) 2.94 1.12 96.97 0.71 18.57 6.77 -2 0 5 10 15 20 25 30 35 Universe(25%) 0.61 1.05 96.01 0.56 17.43 4.80 Total Annualized StdDev, % Universe(Median) -0.64 1.01 94.59 0.49 16.51 3.99 Universe(75%) -1.83 0.96 92.48 0.41 15.80 3.34 Morningstar Foreign Stock Universe Oppenheimer International Growth Y Universe(95%) -4.34 0.83 85.47 0.28 14.24 2.90 Cash MSCI EAFE Large Growth NR USD City of Dover, Delaware Police Pension Plan 40 DOCUMENT PAGE 43

Quarterly Investment Monitor Data as of 06/30/2014 American Funds New Perspective R6 6.13 Portfolio Information 1.51 % Cash Investment Strategy Summary Ticker RNPGX % US Stocks Morningstar Category World Stock 41.91 % Bonds The investment seeks long-term growth of capital; future income is a secondary objective. Avg Mkt Cap $MM 53583.25 % Non-US Stocks The fund seeks to take advantage of investment opportunities generated by changes in Cat Med Mkt Cap $MM 40945.90 international trade patterns and economic and political relationships by investing in % Pref Net Assets $MM 57118.89 common stocks of companies located around the world. In pursuing its primary % Conv Turnover Ratio 30.00 investment objective, it invests primarily in common stocks that the investment adviser % Other % Assets in Top 10 Holdings 18.81 believes have the potential for growth. In pursuing its secondary objective, the fund % Non-US Bonds Total Number of Holdings 276.00 invests in common stocks of companies with the potential to pay dividends in the future. Manager Name Gregg E. Ireland 50.30 _______________________________________________________________________ Manager Tenure 21.59 __ Fund Incept Date 03/13/1973 Prospectus Exp Ratio 0.45 Portfolio Region Portfolio Structure Phone Number 800-421-4225 Performance vs. Peer Group % United States 45.45 % Cash 6.13 35 % Canada 2.30 % US Stocks 41.91 % Latin America 0.43 % Bonds 0.08 % United Kingdom 9.90 % Non-US Stocks 50.30 30 % Eurozone 16.22 % Pref 0.00 Portfolio Ratings % Europe - ex Euro 11.59 % Conv 0.01 Mstar Rating Total Annualized Return, % % Europe - Emerging 0.00 % Other 1.51 3 Year Mstar Rating 25 % Africa 1.86 % Non-US Bonds 0.06 % Rank Cat 3 Yr 23 % Middle East 0.00 5 Year Mstar Rating % Japan 6.34 % Rank Cat 5 Yr 33 20 % Australasia 0.99 10 Year Mstar Rating % Asia - Developed 4.19 % Rank Cat 10 Yr 17 % Asia - Emerging 0.73 15 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 10 3 200 % Basic Materials 6.21 Avg Eff Duration NA % Communication Services 2.58 Effective Maturity NA % Consumer Cyclical 18.60 Avg Credit Quality NA 180 5 % Consumer Defensive 12.45 AAA NA % Healthcare 15.06 AA NA 160 0 % Industrials 11.52 A NA 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 0.00 BBB NA 140 % Technology 14.50 BB NA 2 5th to 25th Percentile 25th to Median % Energy 4.67 B NA Prospectus Exp Ratio 120 Median to 75th Percentile 75th to 95th Percentile Ratio % Financial Services 14.41 Below B NA American Funds New Perspective R6 MSCI AC World Index ND USD % Utilities 0.00 NR/NA NA 100 Turnover 80 Performance 3 Year to 1 3 5 Top Ten Holdings Months Date Year Years Years Novo Nordisk A/S 4.91% 1 60 American Funds New Perspective R6 3.24 3.57 21.90 12.31 15.96 Amazon.com Inc 2.67% MSCI AC World Index ND USD 5.04 6.18 22.95 10.25 14.28 Google Inc Class A 2.12% 40 Universe(5%) 7.24 12.64 31.25 14.59 18.00 Bayer AG 1.69% Universe(25%) 5.27 7.33 25.86 12.72 16.34 Home Depot, Inc. 1.33% Universe(Median) 4.07 5.54 23.24 11.29 14.77 Delta Air Lines Inc 1.32% 20 Universe(75%) 3.20 4.29 20.27 8.90 13.12 Microsoft Corporation 1.21% Universe(95%) 1.39 2.38 15.50 1.25 9.66 Taiwan Semiconductor Manufacturing Co Ltd 1.21% 0 0 Naspers Ltd 1.18% Prospectus Exp Ratio Turnover Ratio American Express Co 1.16% City of Dover, Delaware Police Pension Plan 41 DOCUMENT PAGE 44

Quarterly Investment Monitor Data as of 06/30/2014 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 Jul-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Jun-14 -40 Up/Down Market Capture Ratio Jul-11 - Jun-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, % American Funds New Perspective R6 MSCI AC World Index ND USD 80 Annual Return % 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 60 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 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 20 11 0 0 20 40 60 80 100 120 140 160 180 200 18 10 4 Down Mkt Capture Ratio, % 16 9 Morningstar World Stock Universe American Funds New Perspective R6 Excess Annualized StdDev, % 2 8 Total Annualized StdDev, % 14 MSCI AC World Index ND USD 7 12 Sharpe Ratio 0 Alpha, % 6 1 10 5 -2 Return vs. Risk 8 4 -4 6 Jul-11 - Jun-14 3 20 4 2 -6 15 2 Total Annualized Return, % 1 10 -8 0 0 0 5 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 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 -15 American Funds New Perspective R6 2.39 0.94 95.88 0.91 13.76 2.91 MSCI AC World Index ND USD 0.00 1.00 100.00 0.75 14.27 0.00 -20 Universe(5%) 5.60 1.18 96.79 1.26 18.07 10.83 -25 0 5 10 15 20 25 30 Universe(25%) 2.90 1.08 94.58 0.92 16.26 6.50 Total Annualized StdDev, % Universe(Median) 1.25 1.01 91.19 0.79 15.12 4.87 Universe(75%) -0.92 0.89 84.27 0.66 13.42 3.70 Morningstar World Stock Universe American Funds New Perspective R6 Universe(95%) -7.12 0.57 61.12 0.16 9.78 2.79 Cash MSCI AC World Index ND USD City of Dover, Delaware Police Pension Plan 42 DOCUMENT PAGE 45

Quarterly Investment Monitor Data as of 06/30/2014 Vanguard Emerging Mkts Stock Idx I 2.24 Portfolio Information Investment Strategy Summary % Cash Ticker VEMIX % US Stocks Morningstar Category Diversified Emerging Mkts % Bonds The investment seeks to track the performance of a benchmark index that measures the Avg Mkt Cap $MM 18126.55 % Non-US Stocks investment return of stocks issued by companies located in emerging market countries. Cat Med Mkt Cap $MM 19516.68 The fund employs an indexing investment approach by investing substantially all % Pref Net Assets $MM 64020.59 (approximately 95%) of its assets in the common stocks included in the FTSE Emerging % Conv Turnover Ratio 26.00 Index, while employing a form of sampling intended to reduce risk. The FTSE Emerging % Other % Assets in Top 10 Holdings 13.54 Index includes approximately 851 common stocks of companies located in emerging % Non-US Bonds Total Number of Holdings 955.00 markets around the world. Manager Name Michael Perre _______________________________________________________________________ Manager Tenure 5.84 96.92 __ Fund Incept Date 05/04/1994 Prospectus Exp Ratio 0.12 Portfolio Region Portfolio Structure Phone Number 800-662-7447 Performance vs. Peer Group % United States 0.17 % Cash 0.68 25 % Canada 0.00 % US Stocks 0.16 % Latin America 20.22 % Bonds 0.00 % United Kingdom 0.00 % Non-US Stocks 96.92 20 % Eurozone 0.05 % Pref 2.24 Portfolio Ratings % Europe - ex Euro 0.10 % Conv 0.00 Mstar Rating Total Annualized Return, % % Europe - Emerging 10.39 % Other 0.00 3 Year Mstar Rating 15 % Africa 9.85 % Non-US Bonds 0.00 % Rank Cat 3 Yr 59 % Middle East 1.01 5 Year Mstar Rating % Japan 0.00 % Rank Cat 5 Yr 49 10 % Australasia 0.00 10 Year Mstar Rating % Asia - Developed 15.49 % Rank Cat 10 Yr 32 % Asia - Emerging 42.72 5 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 0 3 200 % Basic Materials 9.95 Avg Eff Duration NA % Communication Services 9.94 Effective Maturity NA % Consumer Cyclical 7.26 Avg Credit Quality NA 180 -5 % Consumer Defensive 8.63 AAA NA % Healthcare 2.02 AA NA 160 -10 % Industrials 5.29 A NA 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 2.55 BBB NA 140 % Technology 13.13 BB NA 2 5th to 25th Percentile 25th to Median % Energy 9.79 B NA Prospectus Exp Ratio 120 Median to 75th Percentile 75th to 95th Percentile Ratio % Financial Services 27.36 Below B NA Vanguard Emerging Mkts Stock Idx I FTSE Emerging NR USD % Utilities 4.09 NR/NA NA 100 Turnover 80 Performance 3 Year to 1 3 5 Top Ten Holdings Months Date Year Years Years Tencent Holdings Ltd. 1.89% 1 60 Vanguard Emerging Mkts Stock Idx I 7.44 7.11 14.08 -0.82 9.00 Taiwan Semiconductor Manufacturing Co Ltd 1.57% FTSE Emerging NR USD 7.52 7.38 13.74 -0.38 9.21 China Construction Bank Corp H Shares 1.55% 40 Universe(5%) 9.85 9.13 21.25 4.47 13.41 China Mobile Ltd 1.49% Universe(25%) 8.04 7.41 16.49 1.30 10.50 Industrial And Commercial Bank Of China Ltd H Shares 1.37% Universe(Median) 7.04 6.48 14.83 -0.07 9.36 Naspers Ltd Class N 1.26% 20 Universe(75%) 6.51 4.82 12.43 -1.87 8.29 Taiwan Semiconductor Manufacturing Co Ltd ADR 1.25% Universe(95%) 4.86 2.29 8.13 -5.72 5.59 Mtn Group Ltd 1.10% 0 0 Bank Of China Ltd. H Shares 1.05% Prospectus Exp Ratio Turnover Ratio Hon Hai Precision Ind Co Ltd 1.02% City of Dover, Delaware Police Pension Plan 43 DOCUMENT PAGE 46

Quarterly Investment Monitor Data as of 06/30/2014 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 Jul-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Jun-14 -40 Up/Down Market Capture Ratio -60 Jul-11 - Jun-14 225 -80 200 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 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 5 0.4 25 8 0 0 20 40 60 80 100 120 140 160 180 200 4 7 Down Mkt Capture Ratio, % 0.3 3 20 6 Morningstar Emerging Markets Universe Vanguard Emerging Mkts Stock Idx I Total Annualized StdDev, % Excess Annualized StdDev, % 2 0.2 FTSE Emerging NR USD 5 1 15 Alpha, % Sharpe Ratio 0 0.1 4 -1 10 Return vs. Risk 3 0.0 -2 Jul-11 - Jun-14 2 6 -3 5 -0.1 4 1 -4 Total Annualized Return, % 2 -5 -0.2 0 0 0 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile -2 Vanguard Emerging Mkts Stock Idx I FTSE Emerging NR USD -4 -6 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr Statistics -8 Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error Vanguard Emerging Mkts Stock Idx I -0.35 1.02 97.40 0.05 20.01 3.24 -10 FTSE Emerging NR USD 0.00 1.00 100.00 0.07 19.44 0.00 -12 Universe(5%) 4.79 1.14 97.26 0.34 22.97 7.68 -14 0 5 10 15 20 25 30 35 40 45 Universe(25%) 1.54 1.03 95.90 0.16 20.41 5.81 Total Annualized StdDev, % Universe(Median) 0.39 0.99 94.32 0.09 19.73 4.88 Universe(75%) -1.49 0.92 92.40 0.00 18.82 4.20 Morningstar Emerging Markets Universe Vanguard Emerging Mkts Stock Idx I Universe(95%) -4.58 0.84 88.17 -0.11 16.97 3.33 Cash FTSE Emerging NR USD City of Dover, Delaware Police Pension Plan 44 DOCUMENT PAGE 47

Quarterly Investment Monitor Data as of 06/30/2014 Vanguard REIT Index I Portfolio Information Investment Strategy Summary % Cash Ticker VGSNX % US Stocks Morningstar Category Real Estate % Bonds The investment seeks to provide a high level of income and moderate long-term capital Avg Mkt Cap $MM 8808.02 % Non-US Stocks appreciation by tracking the performance of a benchmark index that measures the Cat Med Mkt Cap $MM 11652.46 performance of publicly traded equity REITs. The fund employs an indexing investment % Pref Net Assets $MM 44187.28 approach designed to track the performance of the MSCI US REIT Index. The index is % Conv Turnover Ratio 11.00 composed of stocks of publicly traded equity real estate investment trusts (known as % Other % Assets in Top 10 Holdings 38.61 REITs). The fund attempts to replicate the index by investing all, or substantially all, of its % Non-US Bonds Total Number of Holdings 138.00 assets in the stocks that make up the index, holding each stock in approximately the same Manager Name Gerard C. O'Reilly proportion as its weighting in the index. Manager Tenure 18.14 99.87 _______________________________________________________________________ Fund Incept Date 05/13/1996 __ Prospectus Exp Ratio 0.08 Portfolio Region Portfolio Structure Phone Number 800-662-7447 Performance vs. Peer Group % United States 100.00 % Cash 0.13 30 % Canada 0.00 % US Stocks 99.87 % Latin America 0.00 % Bonds 0.00 % United Kingdom 0.00 % Non-US Stocks 0.00 25 % Eurozone 0.00 % Pref 0.00 Portfolio Ratings % Europe - ex Euro 0.00 % Conv 0.00 Mstar Rating Total Annualized Return, % % Europe - Emerging 0.00 % Other 0.00 3 Year Mstar Rating % Africa 0.00 % Non-US Bonds 0.00 % Rank Cat 3 Yr 10 20 % Middle East 0.00 5 Year Mstar Rating % Japan 0.00 % Rank Cat 5 Yr 12 % Australasia 0.00 10 Year Mstar Rating 15 % Asia - Developed 0.00 % Rank Cat 10 Yr 27 % Asia - Emerging 0.00 10 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 2 180 % Basic Materials 0.00 Avg Eff Duration NA % Communication Services 0.00 Effective Maturity NA 5 % Consumer Cyclical 0.00 Avg Credit Quality NA 160 % Consumer Defensive 0.00 AAA NA % Healthcare 0.00 AA NA 140 0 % Industrials 0.00 A NA 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 100.00 BBB NA % Technology 0.00 BB NA 120 5th to 25th Percentile 25th to Median % Energy 0.00 B NA Prospectus Exp Ratio Median to 75th Percentile 75th to 95th Percentile Ratio % Financial Services 0.00 Below B NA 100 Vanguard REIT Index I MSCI US REIT NR USD % Utilities 0.00 NR/NA NA 1 Turnover 80 Performance 3 Year to 1 3 5 Top Ten Holdings Months Date Year Years Years Simon Property Group Inc 8.70% 60 Vanguard REIT Index I 6.99 17.65 13.40 11.81 23.82 Public Storage 4.20% MSCI US REIT NR USD 6.69 17.00 12.02 10.56 22.39 Equity Residential 3.53% 40 Universe(5%) 7.87 18.38 18.03 12.73 25.58 Prologis Inc 3.50% Universe(25%) 7.31 17.61 14.56 11.46 23.59 Ventas Inc 3.27% 20 Universe(Median) 6.94 17.15 13.33 10.95 22.66 HCP Inc 3.18% Universe(75%) 6.65 16.24 12.56 10.29 22.02 Boston Properties Inc 3.08% Universe(95%) 5.55 11.15 9.80 9.26 17.86 Health Care REIT, Inc. 3.08% 0 0 AvalonBay Communities Inc 3.05% Prospectus Exp Ratio Turnover Ratio Vornado Realty Trust 3.01% City of Dover, Delaware Police Pension Plan 45 DOCUMENT PAGE 48

Quarterly Investment Monitor Data as of 06/30/2014 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 Jul-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Jun-14 -30 Up/Down Market Capture Ratio -40 Jul-11 - Jun-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 5 1.1 18 8 0 0 20 40 60 80 100 120 140 1.0 16 7 Down Mkt Capture Ratio, % 4 0.9 14 6 Morningstar Real Estate Universe Vanguard REIT Index I Excess Annualized StdDev, % 0.8 Total Annualized StdDev, % 3 12 MSCI US REIT NR USD 0.7 5 Sharpe Ratio 10 Alpha, % 0.6 2 4 0.5 8 Return vs. Risk 0.4 3 1 6 Jul-11 - Jun-14 0.3 2 25 4 0 0.2 2 1 Total Annualized Return, % 0.1 20 -1 0.0 0 0 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 15 Vanguard REIT Index I MSCI US REIT 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 Vanguard REIT Index I 1.15 1.00 99.98 0.76 16.37 0.21 5 MSCI US REIT NR USD 0.00 1.00 100.00 0.69 16.40 0.00 Universe(5%) 4.40 1.02 99.68 1.01 17.32 7.89 0 0 2 4 6 8 10 12 14 16 18 20 22 Universe(25%) 0.95 1.00 99.41 0.75 16.52 2.66 Total Annualized StdDev, % Universe(Median) 0.61 0.98 99.01 0.72 16.20 1.70 Universe(75%) -0.01 0.95 97.60 0.68 15.84 1.35 Morningstar Real Estate Universe Vanguard REIT Index I Universe(95%) -0.76 0.78 79.60 0.63 14.10 0.96 Cash MSCI US REIT NR USD City of Dover, Delaware Police Pension Plan 46 DOCUMENT PAGE 49

Quarterly Investment Monitor Data as of 06/30/2014 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 measured 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 risk. by beta. A positive alpha figure indicates the portfolio has performed better than its beta would predict. In contrast, a negative alpha Specifically, the higher the percentage, the more concentrated the fund is in a few companies or issues, and the more the fund is susceptible to indicates the portfolio has underperformed, given the expectations established by beta. 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 theory, shorter maturities and higher coupons shorten duration. The relationship between funds with different durations is straightforward: A fund 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 that the with a duration of 10 years is twice as volatile as a fund with a five-year duration. Morningstar prints an average effective duration statistic stock is a bargain. 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 current Average effective maturity is a weighted average of all the effective maturities of the bonds in a portfolio. Effective maturity takes into price of the stock by its trailing 12 months’ earnings per share. In computing the average, Morningstar weights each portfolio holding by the consideration mortgage prepayments, puts, calls, adjustable coupons, and other features of individual bonds and is thus a more accurate percentage of equity assets it represents, so that larger positions have proportionately greater influence on the fund’s final P/E. 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 in its 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 benchmark index. An R-squared measure of 35, for example, means that only 35% of the fund’s movements can be explained by movements in fund has performed 10% better than its benchmark index in up markets and 10% worse in down markets, assuming all other factors 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 performance. It 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 one can be used to compare two portfolios directly on how much excess return each portfolio achieved for a certain level of risk. 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 downward Standard deviation is the statistical measurement of dispersion about an average, which depicts how widely a stock or portfolio’s returns varied variation. The greater the variation, the larger the penalty. Funds are ranked within their categories and stars are assigned as follows: Top 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 10% five stars; Next 22.5% four stars; Middle 35% three stars; Next 22.5% two stars; Bottom 10% one star. 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 are not 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 more included in the expense ratio. 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 available fund Geometric Average Market Capitalization 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 reported as Expressed in percentage terms, Morningstar’s calculation of total return is determined each month by taking the change in monthly net asset average market capitalization. value, reinvesting all income and capital-gains distributions during that month, and dividing by the starting NAV. Reinvestments are made using This number is different from the fund's median market cap--the capitalization of the median stock in its portfolio. The geometric mean 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 that 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, agility, all securities in the portfolio have been traded. In practical terms, the resulting percentage loosely represents the percentage of the portfolio’s and popularity. They help determine whether a small company fund, for example, can remain in its investment-objective category if its holdings that have changed over the past year. 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 47 DOCUMENT PAGE 50

Quarterly Investment Monitor Data as of 06/30/2014 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 48 DOCUMENT PAGE 51

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 52

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 2 DOCUMENT PAGE 53

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 3 DOCUMENT PAGE 54

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 4 DOCUMENT PAGE 55

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 5 DOCUMENT PAGE 56

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 6 DOCUMENT PAGE 57

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 7 DOCUMENT PAGE 58

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 8 DOCUMENT PAGE 59

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 9 DOCUMENT PAGE 60

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. 10 DOCUMENT PAGE 61

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. 11 DOCUMENT PAGE 62

INVESTMENT POLICY STATEMENT CITY OF DOVER POLICE PENSION PLAN August 2014

Investment Policy Statement City of Dover Police Pension Plan INVESTMENT POLICY STATEMENT CITY OF DOVER POLICE PENSION PLAN Table of Contents Section Page I. Purpose and Background 2 II. Statement of Objectives 3 III. Control Procedures & Responsibilities 4 IV. Investment & Allocation Policy 7 V. Investment Manager Guidelines 9 VI. Selection of Investment Managers 11 VII. Investment Evaluation 12 Appendix

Investment Policy Statement City of Dover Police Pension Plan I. PURPOSE & BACKGROUND The Plan is a public employee retirement plan governed by The City of Dover Code of Ordinances. The purpose of this Investment Policy Statement (“IPS”) is to assist the participants of the plan who serve as members of the Police Pension Board of the City of Dover (“Board”) under Section 2‐202 of the City of Dover Code of Ordinances, this Investment Policy Statement (“Statement”) presents investment objectives, policies, guidelines, and monitoring and review procedures relating to financial assets (the “Fund”) of the City of Dover Police Pension Plan (“Plan”). The IPS will function to: 1. State in a written document the Board’s expectations, objectives, and guidelines for the investment of Plan assets which the Board judges to be appropriate and prudent, in consideration of the needs of the Plan. 2. Define and assign the responsibilities for the oversight of the Plan’s assets. 3. Set forth an investment structure for managing Plan assets. This structure will help to define asset class, Investment Manager styles, asset allocation and acceptable ranges that, combined, will help to generate the risk/return profile needed to meet the objectives of this policy. 4. Encourage effective communication between the Board and the Investment Consultant, as well as any other interested parties. 5. Establish formalized performance criteria that the Investment Managers selected are expected to meet and against which they are to be measured on a regular basis. 6. Serve as a review document to guide Board and Investment Consultant oversight of the investment options of the Plan’s assets. 7. Establish the relevant investment time horizon, risk tolerances and performance expectations of the Plan assets and the Board. Page 2 of 14

Investment Policy Statement City of Dover Police Pension Plan II. STATEMENT OF OBJECTIVES The assets of the Plan are invested under the supervision of the Board. After reviewing expected short‐term and long‐term cash flow requirements of the plan, as well as considering the investment time horizon and risk tolerance level believed to be appropriate for the invested assets, the following set of objectives has been established: 1. Preservation of capital. 2. Pay all benefit and expense obligations when due. 3. Achieve a funding cushion to reduce the impact of possible future downturns in the plan’s funded status. 4. Achieve or exceed actuarial earnings assumptions. 5. If applicable, effectively manage the funded status volatility and mitigate undue risk exposure under a Liability Driven Investment (LDI) strategy. The approach can assist in managing interest rate and inflationary risks. 6. Control risk exposure through reasonable and rational diversification of the assets into various asset classes. 7. Establish policies based on total return and expected projected payouts rather than current income. 8. Contain costs of administering and managing the portfolio. 9. Attain a funded status such that the employer has the option to terminate the plan if deemed appropriate. Page 3 of 14

Investment Policy Statement City of Dover Police Pension Plan III. CONTROL PROCEDURES & RESPONSIBILITIES Disclosure Any member of the Board, Custodian/Directed Trustee or Investment Consultant must make full disclosure of any potential conflicts of interest, including any financial gain that may be received as a result of investment decisions made by those entities, which may be required by applicable law. This disclosure should be made before the investment of the plan assets governed by this Investment Policy Statement. Disclosure should be in written form and presented to the members of the Board. Delegation of Authority and Responsibilities The Board is charged under Section 18‐51 of the City of Dover Code of Ordinances with overall responsibility for investment of the Fund. To assist the Board in this function, it is authorized and permitted by said Ordinances to appoint an Investment Advisor, Investment Manager or IM(s), including for this purpose banks, insurance companies, and firms registered under the Investment Advisers Act of 1940 and/or Delaware State law, to manage (including the power to acquire and dispose of) Plan assets. Any appointed Investment Advisor must agree to conduct itself in accordance with all applicable City of Dover Ordinances. The Board shall be responsible for approving any changes to this Investment Policy Statement, and shall be responsible for reviewing the implementation of the Investment Policy Statement not less frequently than annually. These responsibilities include, but are not limited to: Board The Board will be responsible for establishing investment objectives, investment policy and monitoring and review procedures. The establishment of standards for measuring, monitoring, evaluating and comparing absolute and relative investment performance to assure that investment returns are reviewed on a regular basis and investment return objectives are met during acceptable periods of time. The establishment of authorization, reporting, control, review and general governance procedures to assure that investment policies and guidelines are reviewed on a regular basis and conformed to at all times. All modifications of policies and/or guidelines shall be in writing, signed by all Board members, and delivered on a timely basis to any IM and/or Custodian affected by such changes. The establishment of, through contractual relationships with recognized and carefully selected professional organizations, or by alternative means satisfactory to the Board, a retirement plan management structure which will assure appropriate investment management, custody, and surveillance or compliance procedures to meet investment objectives in conformity with the Board's stated investment policies and guidelines. The Board will have discretion to select, add, replace or remove Investment Managers that will be used to meet the Plan’s investment objectives, consistent with the recommendations and advice of the Investment Consultant. Page 4 of 14

Investment Policy Statement City of Dover Police Pension Plan Investment Consultant The Investment Consultant will be responsible for: providing recommendations to the Board for the selection of Investment Managers and appropriate asset allocation, consistent with the Investment Policy Statement objectives and guidelines; reviewing the performance of such Investment Managers over time; periodically reviewing and providing recommendations to the Board for revisions to the Investment Policy Statement; and other tasks as deemed appropriate by the Board. The Investment Consultant will act in a non‐discretionary capacity. Custodian/Directed Trustee The Custodian/Directed Trustee appointed by the Board will be responsible for the safekeeping of the fund assets, including all transaction settlements and deliveries and will perform regular accounting of all assets owned, purchased or sold, as well as transactions and movement of assets into and out of the Plan account. Fund safekeeping and securities settlement procedures shall include direct Custodian participation in one or more appropriate securities depositories (e.g., Depository Trust Company, New York) and, as necessary, correspondent participation in other major depositories (e.g., the Federal Reserve System). The Plan's beneficial ownership of all assets shall be inviolate and in all circumstances perfected. Board or designated IM authority to direct all investment transactions shall similarly be protected. The Directed Trustee will maintain possession of securities owned by the Plan, collect dividend and interest payments, redeem maturing securities, and effect receipt and delivery following purchases and sales. The Directed Trustee will also be responsible for the payments to such persons and for such purposes in order to provide benefits to plan participants and the remittance of any tax related payments to the applicable State and Federal bodies. Fiduciary insurance, and officer liability and omissions and errors insurance coverages, of any Custodian, must meet standards set by the Board from time to time. Investment Manager(s) The specific responsibilities of the Investment Manager(s) relating to the investment management of the fund include: 1. Managing the Plan assets under its care, custody, and/or control in accordance with their Investment Policy Statement (‘IPS’) or Prospectus objectives and guidelines set forth herein. 2. Exercising investment discretion (including holding cash equivalents as an alternative) within their IPS or Prospectus objective and guidelines set forth herein. 3. Promptly communicating all significant and/or material matters and changes pertaining to the investment of Plan assets, including, but not limited to: i. Investment strategy. ii. Portfolio structure. iii. Tactical approaches. iv. Ownership. v. Organizational structure. Page 5 of 14

Investment Policy Statement City of Dover Police Pension Plan vi. Financial condition. vii. Professional staff. viii. All legal material and SEC and other regulatory agency proceedings affecting the firm. 4. Promptly voting all proxies and related actions in a manner consistent with the long‐term interests and objectives of the Plan set forth herein. Each manager shall keep detailed records of said voting and proxies and related actions and will comply with all regulatory obligations related thereto. 5. Utilize the same care, skill, prudence, and due diligence under the circumstances then prevailing that experienced, investment professionals acting in a like capacity and fully familiar with such matters would use in like activities for like benefit plans with like aims in accordance and compliance with all applicable laws, rules, and regulations from local, state, and federal political entities as the pertain to fiduciary duties and responsibilities. The investments should be relatively liquid, or with a reasonable amount of notice, should be capable of liquidating to cash. There should be no fees or penalties for regular trading or liquidation. Page 6 of 14

Investment Policy Statement City of Dover Police Pension Plan IV. INVESTMENT AND ALLOCATION POLICY Investment Horizon: The investment guidelines are based on the expectation that the investment horizon will be several years in length. Short‐term variability in returns should be expected. Because of this, the Plan’s strategic asset allocation is established with moderate to long‐term perspective in mind. The Plan is required to pay retirement benefits to participants as they come due. Therefore, sufficient liquid reserves must be available to satisfy this obligation. 1. The actuary will provide future benefit payment amounts, funding and contribution requirements. 2. The plan should hold a portion of assets in short‐term and cash holdings to provide for the schedule of future benefit payments. Risk Tolerances: It is understood by the Board that achieving the Plan’s investment objectives is not guaranteed and there will be time periods for which these objectives will not be met. The Board also recognizes that some risk must be assumed to achieve the Plan’s investment objectives and accepts the inevitable fluctuations in returns that will occur. While it is understood that a certain level of risk is expected in the Plan’s portfolio, the ability to withstand short and intermediate term variability was specifically considered in the development of the IPS risk tolerances. Factors considered were: 1. It is the intention to fund at least the minimum required contribution (MRC) each year providing ample liquidity. 2. Due to the amount of payouts to occur for many years into the future, the Plan’s liabilities exhibit a longer duration (sensitivity to changes in interest rates). As a result, extending durations in the fixed income portion of Plan assets should be considered. 3. The cash balance portion of the plan's liabilities grows at the rate of T‐bill + 1%. Future liability growth will be factored into all investment decisions. As a result of the above‐named considerations, the Board believes that the Plan can tolerate some interim variability in market value and rates of return in order to achieve its long‐term objectives. Allowable Investments: Cash and Equivalents, Mutual Funds, Separate Accounts, Options and Futures Contracts, Stocks, Bonds, Commingled Funds, and Collective Trusts, Exchange Traded Funds (ETFs) Liquidity Policy: The trust will be required to provide periodic distributions in the form of retirement benefit payments to participants. The actuary provides annual assessments of the funding requirements and payments necessary to meet the plans benefit obligations. Page 7 of 14

Investment Policy Statement City of Dover Police Pension Plan Overall Asset Allocation Policy Based on the Plan’s time horizon, risk tolerances, liquidity needs, and asset class preferences and constraints, an efficient or optimal portfolio was identified. This allocation shall be reviewed at least annually and modified as necessary to meet the needs of the Board. [See Appendix A for the Strategic Asset Allocation Policy of the Plan.] The current allocation strategy is dynamic in nature under a Liability Drive Investment (LDI) approach. The allocation shall be reviewed periodically, at least annually, and modified as necessary to de‐risk the plan, based on the funded status. The overall performance of the portfolio relative to the liabilities will be reviewed in addition to actual performance of the managers. Rebalancing: Rebalancing is the periodic adjustment of the portfolio to restore a pre‐defined Target asset allocation, and will be reviewed at least once per calendar quarter, or as such when the allocation of any asset class exceeds the range around its respective target. Change in Funding Target Level Based on the asset allocation glidepath and funding target levels outlined in the Asset Allocation Policy, an increase in the Plan funding ratio that elevates the plan to a new increment level will trigger a rebalancing of Plan assets to the new targets. If the Plan funding ratio decreases and meets a lower target level, the plan will not rebalance to the new target asset allocation. Timing Rebalancing reviews generally take place quarterly, or at a frequency determined by appropriate by the Board. Generally, the rebalancing transactions will occur over a period of time to reduce undue market timing risk. The Plan will diversify its investment portfolio to avoid incurring unreasonable risks. Investment maturities should be scheduled to coincide with projected cash flow requirements. As funded status improves, the asset allocation policy targets will reduce equity investments and increase fixed income investments and “de‐risk” the plan portfolio. Page 8 of 14

Investment Policy Statement City of Dover Police Pension Plan V. INVESTMENT MANAGER GUIDELINES Every Investment Manager selected to manage Plan assets shall be selected by their policy or ability to adhere to these general guidelines; however will have discretion to meet the investment objectives of their portfolio or investment fund. Unless receiving prior Board approval, the only allowable investments of the Plan will be in cash and equivalents, mutual funds, separate accounts, commingled funds, options and futures, stocks, bonds, exchange traded funds (ETFs) and collective trusts: Cash Policy Cash equivalents will be invested in an appropriate cash‐like fund. Returns should be equal to or better than the 90‐day Treasury Bill Index (3‐month). Money market mutual funds may be used, so long as these funds meet the high standards suitable for funds of this nature. Fixed Income Policy Investment Objectives These assets are to be invested in a mutual fund, commingled funds, separate accounts, or collective trusts of high‐grade index or active fixed income portfolio subject to the limitations set forth below. The investment objectives of the fixed income portion in order of importance are: 1. Preservation of capital 2. Provide for regular dividend and or interest payments 3. Stability of returns – obtain fairly consistent annual returns. Investment Guidelines The Plan’s fixed income assets will be managed in accordance with the following: 1. All funds selected for the fixed income portion must have a readily ascertainable market value and must be readily marketable. 2. Investment Managers selected will be diversified and generally conform to industry guidelines. 3. The Investment Managers shall have discretion to invest a portion of the assets in cash reserves when they deem appropriate. However, the Investment Managers will be evaluated against their peers on the performance of the total funds under their direct management. Page 9 of 14

Investment Policy Statement City of Dover Police Pension Plan Equity Policy Investment Objectives Equity assets are to be invested in mutual funds, commingled funds, separate accounts, stocks, bonds, options and futures, exchange traded funds (ETFs) or collective trusts. Within this framework, the investment objectives of the equity portion are: 1. Long Term Growth of Capital – Assets, exclusive of contribution and withdrawals, should grow in the long run and earn returns equal to the market while risk should be less than the market. 2. Follow a predefined market style (e.g. large cap vs. small cap, value vs. growth) strategy. Investment Guidelines The Plan’s equity assets will be managed in accordance with the following: 1. All funds selected for the equity portion must have a readily ascertainable market value and must be readily marketable. 2. Investment Managers selected will be diversified and generally conform to industry guidelines. 3. The Investment Managers shall have discretion to invest a portion of the assets in cash reserves when they deem appropriate. However, the Fund Managers will be evaluated against their peers on the performance of the total funds under their direct management. Page 10 of 14

Investment Policy Statement City of Dover Police Pension Plan VI. SELECTION OF INVESTMENT MANAGERS The Board, with the assistance of the Investment Consultant, will select appropriate Investment Managers to manage the Plan assets. Investment Managers must meet the following minimum criteria: 1. Is a bank, insurance company, investment management company, or investment advisor as defined by the Registered Investment Advisers Act of 1940. 2. Provide at a minimum, historical quarterly performance numbers calculated on a time‐weighted basis, based on a composite of all the fully discretionary accounts of similar investment style, and reported net and gross of fees. 3. Provide performance evaluation reports prepared by an objective third party that illustrate the risk/return profile of the Investment Manager relative to other managers of like investment style. 4. Provide detailed information on the history of the firm, key personnel, key clients, fee schedule, and support personnel. This information can be supplied by a third party vendor comparable to Lipper or Morningstar. 5. Clearly articulate the investment strategy that will be followed and document that the strategy has been successfully adhered to over time. 6. Investment Managers will be ranked within the top 50 percent of their respective styles on the Investment Consultant’s internal ranking program when available. 7. Some of the measures that may be included in the statistical analysis of a fund would be: a. Alpha – a measure of fund performance compared to its expected return b. Beta – the general level of influence a fund’s market has over its performance c. Standard Deviation – a measure of a fund’s variation of returns over time d. Sharpe Ratio – a measure of a fund’s risk‐adjusted return compared to its risk e. Duration – a measure of sensitivity to interest rate fluctuations over time 8. The Board will consider replacing an actively managed fund if the rank versus its peer group remains in the bottom 50 percent for four consecutive quarters versus its peer group and if statistical analysis concludes that the fund’s level of return does not provide an acceptable ratio as compared to its general level of risk. 9. The Board may consider a fund for replacement when the Investment Manager or policy of the fund is changed. In addition, if there are any substantial transactions with regard to the fund management company or holding, or other types of instabilities in the fund company, replacement will be considered. 10. The Board may also consider replacing a fund if its relative performance over a complete market cycle trails its benchmark. Page 11 of 14

Investment Policy Statement City of Dover Police Pension Plan VII. INVESTMENT EVALUATION Not more than 90 days after the end of each calendar quarter, the Investment Consultant shall report investment positions and performance results to the Board, based on performance reported by each Fund Manager, to monitor and evaluate progress toward the attainment of longer‐term targets. The target rate of return for the Plan has been based on the assumption that future real returns will approximate the long‐term rates of return experienced for each asset class in the IPS. The real rate of return is the return in excess of the anticipated rate of inflation as measured by the Consumer Price Index (CPI). Total Plan Portfolio Performance: Over a complete business cycle, the Plan’s overall annualized total return (net of expenses) should perform at or above the Plan Benchmark. The Plan Benchmark is a customized index composed of the following benchmarks for each target asset class and based on the current and prior target asset allocation policy for the Plan: Asset Category Index* Cash & Money Market BofA ML 3‐month T‐bill Total Return Index Short‐term Bond Barclays US Govt/Credit 1‐3 Yr TR USD Inflation Protected Bond Barclays US Treasury US TIPS TR USD Intermediate‐term Bond Barclays US Govt 5‐10 Yr TR USD Long‐term Bond BC Long Government/Credit High Yield Bond BC High Yield Corporate Bond Large Cap Value S&P 500 Value Large Cap Blend S&P 500 Index Large Cap Growth S&P 500 Growth Mid Cap Value S&P 400 Value Mid Cap Blend S&P 400 Index Mid Cap Growth S&P 400 Growth Small Cap Value S&P 600 Value Small Cap Blend S&P 600 Index Small Cap Growth S&P 600 Growth World Stock MSCI AC World Index ND USD Diversified Emerging Markets FTSE Emerging NR USD REIT/Real Estate MSCI US REIT NR USD *Or other index as designated by the fund and/or fund manager as an appropriate target benchmark for the investment portfolio or fund. Page 12 of 14

Investment Policy Statement City of Dover Police Pension Plan Individual Investment Managers: During its periodic meetings but not less than annually, the Board will review the following specifics with regard to each Investment Manager: 1. The manager’s adherence to their prospectus. 2. Material changes in the manager’s organization, investment philosophy, and/or personnel. 3. Performance compared against an appropriate peer group and benchmark, as listed in the Executive Summary of this IPS, over various time periods. The Board expects the following criteria to be met by each Investment Manager. If a manager fails to meet these, a further review of the manager will be warranted. The Board reserves the right to replace an Investment Manager at their discretion at any time. 1. The Investment Manager’s rank (3‐year and 5‐year return) versus its peer group is over 50 (where a percentile ranking of 1 would be the highest a fund could achieve and 100 would be the lowest). If a fund or Investment Manager’s rank (3‐year and 5‐year return) versus its peer group is over 50, the fund will warrant a closer analytic review. The Board’s review will be comprised of a further analysis of the fund’s statistical performance and risk measures. 2. The Investment Manager’s risk over 3 to 5 years, as measured by standard deviation, should be equal to or lower than the comparative index. If the standard deviation is higher than the index, an increase in performance is expected. 3. The Investment Manager’s Sharpe ratio should be positive over 3 to 5 years and ranked above the peer group median. 4. The Investment Manager’s Alpha should be positive over a 3 to 5 year period and ranked above the peer group median. Page 13 of 14

Investment Policy Statement City of Dover Police Pension Plan SIGNATURE This Statement of Investment Policy approved by action of the Board. Approved by: _______________________________________________ Chairman or representative of the Board _______________________________________________ Treasurer/Finance Director Date approved: ___________ Page 14 of 14

Investment Policy Statement City of Dover Police Pension Plan APPENDIX A This Appendix to the Investment Policy Statement has been reviewed and approved by the Board: STRATEGIC ASSET ALLOCATION POLICY Asset Class Target Cash & Short‐Term Bond 10% Inflation‐Protected Bond 5% Intermediate Term Bond 8% Long‐Term Bond 9% High Yield Bond 8% Large Value 10% Large Growth 10% Mid Cap Equity 5% Small Cap Equity 8% Foreign Equity 10% Diversified Emerging Mkts 10% Real Estate 7% 100% The above ranges will be considered the long‐term or policy allocation. The current “Policy” is the Target for such respective Asset Class of investment. There will be a Range of +/‐ 5% to the Target to allow for modest market fluctuations before rebalancing of the portfolio. The portfolio will be reviewed at least quarterly and adjusted as necessary to maintain alignment with the target allocations. Any deviations beyond the “Range” must have prior approval by the Board, unless caused by market actions. To indicate approval of this amendment to the Investment Policy Statement, the appropriate designated Board member shall sign below. This Appendix to the Statement of Investment Policy approved by action of the Board. Approved by: _______________________________________________ Chairman or representative of the Board Date approved: ___________

Investment Policy Statement City of Dover Police Pension Plan APPENDIX A This Appendix to the Investment Policy Statement has been reviewed and approved by the Board: STRATEGIC ASSET ALLOCATION POLICY (1) Asset Class Target Cash & Short‐Term Bond 8% Inflation‐Protected Bond 5% Intermediate Term Bond 6% Long‐Term Bond 7% High Yield Bond 7% Large Value 11% Large Growth 14% Mid Cap Equity 6% Small Cap Equity 7% Foreign Equity 12% Diversified Emerging Mkts 9% Real Estate 8% 100% The above ranges will be considered the long‐term or policy allocation. The current “Policy” is the Target for such respective Asset Class of investment. There will be a Range of +/‐ 5% to the Target to allow for modest market fluctuations before rebalancing of the portfolio. The portfolio will be reviewed at least quarterly and adjusted as necessary to maintain alignment with the target allocations. Any deviations beyond the “Range” must have prior approval by the Board, unless caused by market actions. To indicate approval of this amendment to the Investment Policy Statement, the appropriate designated Board member shall sign below. This Appendix to the Statement of Investment Policy approved by action of the Board. Approved by: _______________________________________________ Chairman or representative of the Board Date approved: ___________

Investment Policy Statement City of Dover Police Pension Plan APPENDIX A This Appendix to the Investment Policy Statement has been reviewed and approved by the Board: STRATEGIC ASSET ALLOCATION POLICY (2) Asset Class Target Cash & Short‐Term Bond 6% Inflation‐Protected Bond 3% Intermediate Term Bond 4% Long‐Term Bond 6% High Yield Bond 7% Large Value 12% Large Growth 15% Mid Cap Equity 7% Small Cap Equity 8% Foreign Equity 13% Diversified Emerging Mkts 10% Real Estate 9% 100% The above ranges will be considered the long‐term or policy allocation. The current “Policy” is the Target for such respective Asset Class of investment. There will be a Range of +/‐ 5% to the Target to allow for modest market fluctuations before rebalancing of the portfolio. The portfolio will be reviewed at least quarterly and adjusted as necessary to maintain alignment with the target allocations. Any deviations beyond the “Range” must have prior approval by the Board, unless caused by market actions. To indicate approval of this amendment to the Investment Policy Statement, the appropriate designated Board member shall sign below. This Appendix to the Statement of Investment Policy approved by action of the Board. Approved by: _______________________________________________ Chairman or representative of the Board Date approved: ___________

Investment Policy Statement City of Dover Police Pension Plan APPENDIX A This Appendix to the Investment Policy Statement has been reviewed and approved by the Board: STRATEGIC ASSET ALLOCATION POLICY (3) Asset Class Target Cash & Short‐Term Bond 5% Inflation‐Protected Bond 2% Intermediate Term Bond 2% Long‐Term Bond 4% High Yield Bond 7% Large Value 9% Large Growth 16% Mid Cap Equity 9% Small Cap Equity 11% Foreign Equity 15% Diversified Emerging Mkts 11% Real Estate 9% 100% The above ranges will be considered the long‐term or policy allocation. The current “Policy” is the Target for such respective Asset Class of investment. There will be a Range of +/‐ 5% to the Target to allow for modest market fluctuations before rebalancing of the portfolio. The portfolio will be reviewed at least quarterly and adjusted as necessary to maintain alignment with the target allocations. Any deviations beyond the “Range” must have prior approval by the Board, unless caused by market actions. To indicate approval of this amendment to the Investment Policy Statement, the appropriate designated Board member shall sign below. This Appendix to the Statement of Investment Policy approved by action of the Board. Approved by: _______________________________________________ Chairman or representative of the Board Date approved: ___________