Attachment

POLICE PENSION BOARD AGENDA FEBRUARY 14, 2013 - 1:00 P.M. CITY HALL CONFERENCE ROOM 15 LOOCKERMAN PLAZA DOVER, DELAWARE Public comments are welcomed on any item and will be permitted at appropriate times. When possible, please notify the City Clerk (736-7008 or e-mail at CityClerk@dover.de.us) should you wish to be recognized. AGENDA ADDITIONS/DELETIONS 1. Adoption of Minutes - Police Pension Board Meeting of November 8, 2012 2. Quarterly Performance Review (Quarter Ending December 31, 2012) (Milliman, Inc.) 3. Financial Activity for the Fiscal Year Ending June 30, 2012 and Results of Actuarial Study 4. Adjournment by 1:50 P.M. TO ASSURE THAT THERE WILL BE A QUORUM, PLEASE RSVP BY CONTACTING THE CITY CLERK’S OFFICE BY EMAIL AT CITYCLERK@DOVER.DE.US OR BY CALLING 736-7008 AS SOON AS POSSIBLE. /js S:\AGENDAS-MINUTES-PACKETS\Misc-Agendas\PENSION BOARDS\2013\02-14-2013 POLICE PENSION BOARD AGENDA.wpd THE AGENDA ITEMS AS LISTED MAY NOT BE CONSIDERED IN SEQUENCE. THIS AGENDA IS SUBJECT TO CHANGE TO INCLUDE THE ADDITION OR THE DELETION OF ITEMS, INCLUDING EXECUTIVE SESSIONS.

POLICE PENSION BOARD The Police Pension Board meeting was held on November 8, 2012 at 1:11 p.m. with Chairman Mullaney presiding. Members present were Mr. Stallings, Mr. Knotts, and Mr. Koenig. Councilmen Bonar and Lynn were absent. AGENDA ADDITIONS/DELETIONS By unanimous consent, the agenda was adopted as presented. Adoption of Minutes - Police Pension Board Meeting of August 15, 2012 Mr. Knotts moved for adoption of the minutes of the Police Pension Board meeting of August 15, 2012, seconded by Mr. Stallings and unanimously carried. Quarterly Performance Review (Quarter Ending September 30, 2012) (Milliman, Inc.) Mr. Jeff Marzinsky, Principal and Employee Benefits Consultant, Milliman, Inc., reviewed the City of Dover Delaware Police Pension Report dated November 8, 2012. In regard to the Market Commentary, he noted that equity markets were up approximately 30% in the last 12 months and that Milliman’s capital market assumptions had predicted equity returns averaging approximately 8%. He advised members that positive economic indicators included a reduction in unemployment and an increase in consumer sentiment; however, concerns remained in the international market regarding austerity planning and debt management in the European Union. He described the current market climate as “cautiously optimistic.” In reviewing the Performance Summary, Mr. Marzinsky stated that as of September 30, 2012, the balance of the Police Pension Fund was approximately $10.9M, as shown on Page 9. He noted that contributions made to the plan were used to rebalance it to target investment allocations from the Investment Policy and that the portfolio was currently meeting the Policy guidelines. Mr. Marzinsky advised members that the Investment Policy Review - Active Management (Page 10) reflected the performance of plan investments and that highlighted areas indicated underperformance. He noted that the Vanguard Morgan Growth Adm and the Vanguard PRIMECAP Inv funds had positive long-term histories and advocated monitoring these investments for improving performance; however, he suggested that the Dimensional Fund Advisors (DFA) U. S. Targeted Value I and DFA International Value I Funds be replaced with other investments. He noted that funds are ranked over three (3) and five (5) year periods from 0 (the best rank) to 99 (the worst rank) and the DFA International Value Fund I was near the bottom of its category. He explained that a negative number in the Excess Return column indicated that the fund was trailing its index. Mr. Marzinsky stated that the Relative Standard Deviation column provided information regarding the volatility of the fund. He indicated that Alpha and Sharpe were metrics used to determine how well a manager is doing with adding value to the investments. He noted that a lower number is better and a higher number is worse in these areas. Referring to Page 11, Investment Policy Review - Passive Management, he noted that index investments were following the market as they were designed to do. Mr. Marzinsky stated that the Investment Option Return Summary (Page 12), contained information regarding the performance of the plan over various time periods. He noted that the Police Pension Plan had a gross return of 1.18% over three (3) months and 2.24% over the year to date. He

POLICE PENSION BOARD MEETING OF NOVEMBER 8, 2012 PAGE 2 explained that returns were slightly different from the policy index due to the timing of contributions to and distributions from the plan. He stated that if the plan were reallocated in accordance with Milliman’s recommendations, these numbers should become more closely aligned. He noted that a review would be performed of the historical performance calculations of the former plan investment advisor. Approval of Amendments to Investment Policy and Changes/Additions to Investment Managers (Milliman, Inc.) Mr. Marzinsky reviewed suggested changes to the Police Pension Fund Investment Policy and portfolio. Referring to Page 13 of the City of Dover Delaware Police Pension Fund Report dated November 8, 2012, he explained that the Asset Category table showed the asset categories and target allocations within those categories, as approved by members during their meeting of August 15, 2012. He noted that to avoid continually rebalancing the portfolio as equities fluctuate, minimum and maximum thresholds would be set that would allow for slight market fluctuations before rebalancing. He noted that equity investments would be reduced from 65% to approximately 60% of the portfolio, with 40% allocated to fixed income and cash, which would reduce volatility. Referring to the Dynamic Investment Policy (Page 13), Mr. Marzinsky explained that the funded status of the plan considers the liabilities and assets of the plan. He stated that the plan was approximately 50% funded, which should increase as contributions are made to the plan and assets grow and appreciate. He noted that as the funded status of the plan improves, the equity allocation would decrease and the fixed income allocation would increase. This would “immunize” or de-risk the plan and tie the duration of the plan liabilities to the duration of the assets. He stated that this change in the equity allocation would be made when the plan achieves 70% funded status, according to the recommended Investment Policy Amendment. Responding to Mr. Mullaney, Mr. Marzinsky confirmed that the 50% funded level statistic was based on the last actuarial valuation performed. Mrs. Mitchell explained that an actuarial study was currently being prepared and anticipated that results would be presented, along with cash in/cash out statements from the Comprehensive Annual Financial Report (CAFR) that was in progress, at the next meeting of the Police Pension Board. Mr. Marzinsky noted that tying together the actuarial valuation and funded status was a very important component of managing plan assets. In response to Mr. Mullaney, Mr. Marzinsky stated that if the dynamic policy were approved by members, reallocation of investments according to the grid on Page 13 would become automatic. However, he reminded members that the 60% to 40% equity/fixed income allocation would be reviewed each year to determine if that ratio makes sense and the allocation might be adjusted according to capital market assumptions. Mr. Marzinsky reviewed the Fund Changes to Meet Allocation Policy (Page 13), which included a breakdown of existing funds as well as new funds recommended for addition to the plan. He noted the proposed removal of underperforming Dimensional Fund Advisors (DFA) investments and the

POLICE PENSION BOARD MEETING OF NOVEMBER 8, 2012 PAGE 3 addition of asset categories and fund managers that had not been included in the plan previously. He indicated that he had confirmed with Wells Fargo that these invesments were available on their platform. Responding to Mr. Mullaney, Mrs. Donna Mitchell, Controller/Treasurer, explained that amendments to the investment policies of the Civilian and Police Pension plans were being considered separately. She noted that although these policies were currently consistent, this would not necessarily be the case in the future due to the potentially differing needs of the individual plans. Mr. Marzinsky stated that the asset allocation of the Police Pension Plan was slightly different from the Employees’ Pension Plan since a Liability Asset to Allocation Study revealed that the two (2) plans have different durations. Since the Police Pension Plan has a 13-year duration and the Employees’ Pension Plan has an 18-year duration, the Employees’ plan had more assets allocated to long-term bonds. Mr. Marzinsky stated that the suggested changes were incorporated in Amendment 1 to the Investment Policy Statement for the City of Dover Police Pension Board. Mr. Knotts moved to accept Amendment I to the Investment Policy Statement for the City of Dover Police Pension Board, seconded by Mr. Stallings and unanimously carried. Mr. Marzinsky explained that the 13-year duration of the plan would shorten because no new members were entering the plan; therefore, Milliman would perform an asset/liability study periodically to ensure that the duration of the investments was matched to the duration of the plan. Mr. Knotts moved for adjournment, seconded by Mr. Stallings and unanimously carried. Meeting Adjourned at 1:37 P.M. Timothy Mullaney Chair TM/JS/mk/dd/tm S:\AGENDAS-MINUTES-PACKETS\Misc-Minutes\PENSION\2012\11-08-2012 Police Pension.wpd Attachment Attachment #1 - Amendment I to the Investment Policy Statement for the City of Dover Police Pension Board

ATTACHMENT #1 Police Pension Board Meeting of 11/08/2012 INVESTMENT POLICY CITY OF DOVER POLICE PENSION BOARD May, 2007 As Amended November 9, 2011 As Amended November 8, 2012

TABLE OF CONTENTS INTRODUCTION .........................................................................................................................................................3 PURPOSES OF THE STATEMENT .......................................................................................................................3 PLAN DESCRIPTION .............................................................................................................................................3 PORTFOLIO MANAGEMENT PRECEPTS ..........................................................................................................3 PRUDENCE IN INVESTMENT..............................................................................................................................4 RESPONSIBILITIES OF THE BOARD AND STAFF ...........................................................................................4 RESPONSIBILITIES OF THE INVESTMENT MANAGER(S) ............................................................................5 RESPONSIBILITIES OF THE PLAN CUSTODIAN(S) ........................................................................................5 INVESTMENT OBJECTIVES .....................................................................................................................................7 INVESTMENT POLICY ..............................................................................................................................................9 ASSET ALLOCATION ...........................................................................................................................................9 ALLOCATION MONITORING/REBALANCING ................................................................................................9 LIQUIDITY ..............................................................................................................................................................9 PROXY VOTING ..................................................................................................................................................10 DIVERSIFICATION ..............................................................................................................................................10 MUTUAL FUNDS .................................................................................................................................................10 INVESTMENT GUIDELINES ...................................................................................................................................10 GENERAL GUIDELINES .....................................................................................................................................10 DOMESTIC EQUITY INVESTMENT GUIDELINES ......................................................................................... 11 Specific Guidelines, Domestic Equity ....................................................................................................................11 INTERNATIONAL EQUITY INVESTMENT GUIDELINES .............................................................................12 Specific Guidelines, International Equity ...............................................................................................................12 DOMESTIC FIXED INCOME INVESTMENT GUIDELINES ...........................................................................13 Specific Guidelines, Fixed Income .........................................................................................................................13 REVIEW PROCEDURES...........................................................................................................................................16 SIGNATURES ............................................................................................................................................................17 AMENDMENT 1 ........................................................................................................................................................18 2 of 19

City of Dover Police Pension Board Investment Policy Statement Pension Plan INTRODUCTION PURPOSES OF THE STATEMENT Based upon and in keeping with requirements of City of Dover officials and Police Pension Plan participants serving 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 Statement’s purposes are to: 1. Present appropriate goals and objectives relating to investment management of the Fund. 2. Recognize and/or specify diversification and liquidity requirements and identify any legal constraints affecting investment management of the Fund. 3. Promulgate guidelines, consistent with any Board-selected investment time horizon(s), investment management classifications, and/or investment management styles, to which any Board-appointed Investment Manager (IM) shall adhere when determining investment strategies, making periodic investment decisions, and/or undertaking specific investment transactions relating to the Fund. 4. Establish standards and procedures for monitoring, measuring, reviewing, and absolutely and comparatively evaluating IM investment performance, along with similar standards and procedures for assuring conformity with investment policies, goals, objectives, guidelines, and/or constraints. 5. Foster understanding and effective communications between the Board and Staff and any persons appointed, employed, designated or in any way called upon by the Board or Staff to serve the Plan and its participants and/or beneficiaries. PLAN DESCRIPTION The Plan is a public employee retirement plan governed by the City of Dover Code of Ordinances as cited within “Purposes of the Statement,” above. PORTFOLIO MANAGEMENT PRECEPTS The Board endorses contemporary investment practices, based upon the construction of well diversified multi-asset portfolios, which facilitate control of investment risk and afford reasonably predictable long-term investment returns, primarily by IM selection which maintain distinct investment practices or “styles” within any asset class. The monitoring and appropriate investment performance measurement respecting such styles requires relative comparisons 3 of 19

among peers and to chosen (usually index) benchmarks as well as absolute measures respecting the financial progress of the Plan itself. PRUDENCE IN INVESTMENT Applicable terms, conditions, limitations and restrictions of applicable law upon Delaware fiduciaries notwithstanding, any IM serving the Fund shall discharge any duties relating to the Fund solely in the interest of Plan participants and beneficiaries, shall demonstrate appropriate knowledge of the Plan’s purpose and contemporary operations, and shall diversify the investments of any Fund investment portfolio so as to minimize the risk of substantial loss. When contemplating any investment, investment strategy or investment program, any IM managing any part of the Fund shall consider all relevant factual and circumstantial information and the impact of such information on a particular investment, strategy, or program, and on the Total Fund. Further, respecting investment strategies, programs and/or specific investment actions for the Fund, any IM shall also consider: 1. potential losses and gains, 2. the composition of any IM-assigned portfolio, and the Total Fund, with regard to a. diversification b. liquidity and current return relative to the Fund’s cash flow requirements c. projected total return relative to the Plan's funding objectives Guidelines respecting Prudence have been developed in light of investment objectives related solely to the Plan’s varied and dynamic obligations to its participants and beneficiaries. Actuarial, economic, investment, and even socio-political events and trends are fluid factors affecting the funding of those obligations. Accordingly, these guidelines respecting Prudence are, as a part of this Statement, intended singularly to present broad and balanced considerations to guide incumbent and successor Board and Staff, and all other parties concerned, seeking appropriate allocation, investment, safekeeping, monitoring and evaluation of the Fund. RESPONSIBILITIES OF THE BOARD AND STAFF 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 must also develop prudent management policies and guidelines intended to assure that the Plan will fulfill its objectives. Policies and guidelines are inclusive of, but not restricted to: 4 of 19

1. Establishment of investment objectives, investment policy, investment guidelines, and monitoring and review procedures. 2. 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. 3. 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. 4. 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 shall examine this Statement from time to time and make appropriate revisions. At least annually the Board shall review the Statement entire and communicate any material changes to any persons affected by them. RESPONSIBILITIES OF THE INVESTMENT MANAGER(S) Fund management and responsibilities for investment decisions are delegated to any appointed IM. Any IM shall exercise complete discretion within the clear limits established by this Statement. Accordingly, the Board requires adherence to Delaware or other pertinent laws as now apply, or may apply in the future, with particular attention to the standards established by applicable rules of law. Fiduciary insurance, and officer liability and omissions and errors insurance coverages, of any IM, must meet standards set by the Board from time to time. If at any time a manager believes that this Investment Policy Statement inhibits its investment performance, it is the manager’s responsibility to communicate this view to the Pension Board. In addition, the manager will promptly (within 30 days) notify the Pension Board, in writing, regarding all material or significant matters that change pertaining to the investments of the retirement fund assets, including but not limited to:  changes in investment strategy portfolio structure, tactical approaches and market value of managed assets;  changes in ownership organizational structure, financial condition, and/or professional staff of the investment firm; and  all material legal, SEC and other regulatory proceedings affecting the firm. 5 of 19

RESPONSIBILITIES OF THE PLAN CUSTODIAN(S) Any Custodian appointed by the Board shall be responsible for safekeeping of the Fund, including all security transaction settlements and deliveries, and for comprehensive recordkeeping and reporting, which shall include any custom recordkeeping, record retention, or reporting reasonably required by the Board or Staff. Safety and continuity of operations shall be the primary objectives of any Custodian. Timely, accurate, and complete recordkeeping and reporting, arising from superior state-of-the-art information systems and committed staff, shall be the primary benchmarks for month-to-month evaluation of Custodian performance. 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. Ready access to information by the Board and Staff shall be a prime requisite of recordkeeping and reporting services, with no bar as to frequency of access, nor any delay greater than one day acceptable. Transaction records shall be maintained on a trade date basis and shall remain immediately available for at least two years. Nationally accepted asset pricing should be daily and reported not less often than monthly, and "non-trade" transaction records (e.g., stock splits, etc.) should be both available immediately and properly carried into monthly transaction and asset value reports. 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. 6 of 19

INVESTMENT OBJECTIVES Investment Objectives for the Plan represent anticipated results and are long-term in nature. Given the Board assumptions respecting current and projected Plan and capital market conditions, the following Objectives have been delineated: 1. All Plan fiduciaries shall discharge their responsibilities and the Fund shall be invested in a manner consistent with [relevant law] and generally accepted fiduciary standards. Further: (1) all transactions undertaken on behalf of the Plan shall be solely in the interest of Plan participants and beneficiaries, and (2) with reference to Prudence in Investment, set forth earlier in this Statement, safeguards and diversification to which a prudent investor familiar with and managing the Fund of this Plan under known or foreseeable circumstances would adhere, and liquidity and current return consistent with rationally anticipated cash flow requirements of the Fund, shall be governing factors in all investment considerations. 2. Consideration shall be given to suitable long-term investment intended to provide Fund capital and income growth which may be utilized to increase future benefits and thus maintain the purchasing power of Plan participants and their beneficiaries; the Board anticipates that such capital and income growth will be achieved during each economic and/or securities market cycle and/or within its selected three-to-five (3-5) year investment time horizon. 3. Consideration shall also be given, granting conformity with the objectives of 2., above, to providing adequate and timely cash flows to meet anticipated Plan benefit payments, with sufficient reserves to meet relatively smaller flows for unanticipated benefit payments; adequate emphasis, consistent with the foregoing, shall be placed upon current investment return; any Fund IM should expect to receive periodic projections of Fund liquidity requirements but, in the absence of such projections, shall be responsible for seeking necessary information from the Board or any party designated by the Board for this purpose. 4. While professional managers may strive to record positive rates of investment return during all measurement periods, securities markets are unlikely to provide a consistently favorable climate, on a shorter-term basis, for longer-term investments. Therefore, considering usual multi-year economic and/or investment cycles, and the three-to-five (3-5) year investment time horizon selected by the Board, requisite but not exclusive comparative or benchmark measures of investment return, and of risk or volatility, are delineated as follows: a. Commensurate with preserving participant and beneficiary purchasing power through the Plan, it is desired to achieve a positive real (post-inflation) rate of return during any multi-year period and over the life of the Plan. Based upon current and projected Plan and capital market conditions, and the extensive historical records provided by such sources as Ibbotson-Sinquefeld, the Board has set returns meeting or exceeding the Plan’s actuarial interest rate assumption at any time, annualized, as a gross multi-year return target. Concurrently, 3.5 percentage points above the CPI, or an annualized 3.5 percent real rate of return, is anticipated for the Total Fund. b. Consistent with anticipated real returns (above) and separate asset class returns (below), annualized Total Fund investment performance, for periods of three-to-five (3- 5) years or more, is expected to meet or exceed the Plan's assumed actuarial rate and to 7 of 19

meet or exceed the annualized investment performance of a "policy index" comprised of a weighted average of relevant asset-class indexes matched with policy or "target" asset allocations in effect on average for the Fund during the period considered. c. Consistent with b., above, the Total Fund’s investment return volatility, as measured by the standard deviation of quarterly investment returns, is not expected to exceed the volatility of the policy index during any three-to-five (3-5) year measurement period. d. Also consistent with b., above, Total Fund domestic equity investment returns are expected to meet or exceed similar annualized returns of the Russell 3000 Stock Index during periods of three-to-five (3-5) years or more; equity investment returns of any specific IM, annualized, are expected to meet or exceed returns of any index or benchmark cited in writing by the Board as appropriate to the investment process or "style" of any specific IM. e. Also consistent with b., above, Total Fund domestic fixed income investment returns, annualized, are expected to meet or exceed similar returns of the Lehman Brothers Intermediate Government/Credit Bond Index during periods of three-to-five (3-5) years or more; as in d., above, any index or benchmark may be chosen by the Board as appropriate to the investment process, "style", or time-horizon of any specific IM. f. All investment performance data submitted to the Board or its designees directly or indirectly by or on behalf of any IM shall as applicable be submitted in conformity with the North American Performance Presentation Standards and/or Global Investment Performance Standards promulgated by the Association for Investment Management and Research. 5. Investment performance objectives of the Fund are, as stated initially under Investment Objectives, above, long-term in nature. Concern respecting market value or Fund investment return volatility and other measures reflecting investment uncertainty will be addressed in part by functional constraints imposed by the Board through asset (class) allocations, investment management processes or "styles" chosen, portfolio diversification requirements, and other investment management guidelines and/or limitations. 8 of 19

INVESTMENT POLICY Investment Policy delineates controls and the associated monitoring intended to enhance the likelihood of meeting Investment Objectives during acceptable periods of time. ASSET ALLOCATION Asset class allocation, resulting in so-called asset mix or investment ratios, is intended to afford an optimum approach toward Investment Objectives while limiting investment risk by assuring basic diversification. The variable percentages of asset classes delineated below provide a framework through which the Fund investments may be adjusted to meet economic and/or investment market conditions while remaining centered on the allocation target deemed most appropriate to the Fund's long-term Investment Objectives. Asset Class Minimum % Target % Maximum% Benchmark Equities 60 65 70 Domestic 44 49 54 Russell 3000 International 11 16 21 MSCI EAFE (net) Fixed Income 30 35 40 Bonds 28 33 38 Barclays Intermediate Gov't/Credit Cash 0 2 5 ML 90 Day T‐Bill ALLOCATION MONITORING/REBALANCING The Board shall review asset allocation quarterly to monitor Total Fund allocation targets. In the event that asset allocations because of cash flows or market value changes fall moderately outside the ranges in the tables above, any appointed Custodian may be notified and instructed by the Board to adjust contribution cash flows to any specific IM and thus return the Total Fund to appropriate asset allocation levels. Should an allowable range be breached substantially, i.e., by ten (10) percent of per-portfolio per-IM assets or five (5) percent of Total Fund Assets, any IM involved may be required by the Board to adjust assets immediately. The Board may set asset allocation ranges for any specific IM different from ranges for the Total Fund. LIQUIDITY Emphasis shall, per Investment Objectives, 3., above, be placed on providing adequate and timely Fund cash flow to permit benefit payments from the Plan when due. The Board endeavors to meet all of the Plan’s multiple objectives through asset allocation and constructive Investment Guidelines. Nevertheless, any IM appointed by the Board shall be responsible for seeking from the Board or its designee(s) current information respecting cash flow requirements and for assisting in meeting said requirements. 9 of 19

PROXY VOTING While matters of public interest as well as corporate governance have long been a part of publicly owned corporations’ Annual Meetings and proxy voting activity in the United States, the Board continues to believe that the Fund’s proxy voting must be based upon the long-term economic value of the securities represented in each case and thus solely in the interests of Plan participants and their beneficiaries. The Board delegates timely and complete proxy voting to any IM to assure that the interests cited immediately above have been met. Delegation as stated precludes Board interference with or exercise of proxy voting, but does not preclude any IM request for and independent consideration of Board views officially determined and expressed. DIVERSIFICATION Total Fund investments must be diversified broadly to minimize the risk of substantial losses. The Board recognizes that significant diversification is accomplished through asset allocation and the selection of investment management organizations. Nevertheless, the Investment Guidelines provided herewith include certain provisions intended to optimize investment diversification. MUTUAL & OTHER COMMINGLED FUNDS Given the nature of mutual and other commingled funds, it is recognized that there may be deviations between this Investment Policy Statement and the objectives of the mutual and other commingled fund(s). However, every effort shall be made to the extent practical or prudent and appropriate to select mutual and other commingled funds that have investment objectives and policies that are consistent with this Investment Policy. INVESTMENT GUIDELINES Investment Guidelines describe for any IM and for the information of any Custodian or interested person a wide range of permissible investment activities and choices while also delineating, specifically or by broader proscription, those which are not permissible. GENERAL GUIDELINES Subject to the asset allocation ranges set forth as a table within Investment Policy, above, or separate asset allocation ranges assigned specifically to any IM by the Board, any IM is expected to undertake flexible discretionary management of Fund assets. Nevertheless, when responsible for any investment portfolio, any IM shall report immediately to the Board or its designee(s) any shift between or change in market value of asset classes which equals or exceeds ten (10) percent of the market value of the assets assigned to the specific IM. For the purpose described herein, cash and money market or cash equivalent securities shall be considered an asset class. The Board has determined that certain investment practices, as well as certain types of investments, are not suitable for the Fund irrespective of circumstances: 10 of 19

1. Buying or (short) selling securities on margin, and/or the use of any other form of leverage, excepting the lending of securities if approved in writing by the Board. 2. Privately placed or otherwise unregistered securities excepting fixed income securities, issued under SEC Rule 144(a), which are demonstrably marketable and otherwise within guidelines. 3. Investment in commodities or in any type of commodities contracts, forward or futures trading activities, and all forms of portfolio hedging, excepting the limited use of stock options and/or currency hedges; (See Domestic Equity and International Equity Investment Guidelines, below.) 4. Fixed income investments may not include deep discount or zero coupon (excepting U.S. Treasury) securities, tax exempt, indirectly asset backed or spread-dependent, and stripped or otherwise derivative or synthetic securities. Certain exceptions are delineated below. DOMESTIC EQUITY INVESTMENT GUIDELINES The Board shall review the Fund at least quarterly to assure that the domestic equity limit of 54 percent of Fund market value is not exceeded; as necessary, any Custodian will be instructed to redirect cash flows to or from any IM or to accommodate immediate Board-directed IM asset allocation revision to restore the Asset Allocation currently approved by the Board. Permissible equity investments shall include convertible securities, which shall be limited to ten (10) percent of Fund assets at market value, as well as American Depositary Receipts (ADRs), equally limited. Any IM retained for this mandate shall conform to the Domestic Equity Investment Guidelines set forth above and below. Any departure from the Guidelines must be submitted in writing to the Board for prior approval, as must any change in the “style” or investment philosophy, process, or practices approved by the Board at the time any IM was retained to serve the Fund. Specific Guidelines, Domestic Equity 1. Full discretion, consistent with the Investment Objectives, Policies, and Guidelines set forth in this Statement, is granted to each IM retained to manage domestic equity securities. 2. Each IM retained for this mandate shall select domestic equity investments in conformity with criteria normally applied in its decision making process and previously reviewed and approved by the Board. 3. No IM shall invest on a market value basis more than five (5) percent of the domestic equity portion of any portfolio in the equity security(ies) of a single corporation or group of directly affiliated corporations, nor maintain an investment of more than eight (8) percent similarly calculated. 4. No IM may make or maintain an investment equaling or exceeding four and nine-tenths (4.9) percent ownership of the outstanding domestic equity security(ies) of a single corporation, or group of directly affiliated corporations, without the written consent of the Board. 11 of 19

5. Each IM is expected to purchase marketable domestic equity securities listed on national securities exchanges or actively traded within the national NASDAQ framework; domestic U.S. equity securities, purchased outside the channels cited, or purchased without regard to necessary market liquidity as demonstrated through weekly trading statistics, place upon any IM a special burden respecting Board tolerance of unacceptable risk and/or losses which might ensue. 6. As an exception to the general prohibition against so-called alternative investment instruments, stock options may be utilized by each IM managing domestic U.S. equity securities in “covered” or hedging postures but not in “naked” or speculative postures. 7. Again the total annualized investment return of all domestic U.S. equity investments of the Fund is expected to meet or exceed the total annualized return of the Russell 3000 Stock Index for cumulative periods of three-to-five (3-5) years or more. 8. Any IM serving as an active domestic U.S. equity manager will be assigned an index or other type of benchmark deemed suitable for it and agreed upon with the Board; as a general expectation any IM should exceed its assigned benchmark, post fees, on annualized bases during periods of three-to-five (3-5) years or more. INTERNATIONAL EQUITY INVESTMENT GUIDELINES The Board/Trustees shall review the Fund at least quarterly to assure that the International Equity limit of 21 percent of Fund market value is not exceeded; as necessary, the Custodian(s) will be instructed to redirect cash flows to the DA(s) or to accommodate immediate Board- directed DA(s)’ asset allocation revisions to restore the asset allocation currently approved by the Board/Trustees. Stated percentages may include foreign equity securities admitted to trading on U.S. Stock Exchanges or NASDAQ; American Depositary Receipts (ADRs) shall be designated as domestic equities. Specific Guidelines, International Equity 1. Investment in International Equity is permissible up to the maximum stated in asset allocation (page 7). Each IM retained as an International Equity Manager must receive specific Board authorization to invest in International Equity. Investing in emerging market equity securities is permissible subject to a maximum of fifteen (15) percent of any international equity portfolio at market value. Appropriate regional, national, industry and individual security diversification must be maintained at all times. 2. Any IM retained for this mandate is expected to select International Equity investments in conformity with criteria normally applied in its decision making process and previously reviewed and approved by the Board. 3. No IM shall invest more than five (5) percent of the equity portion of any International Equity portfolio in the equity security(ies) of a single corporation or group of directly affiliated corporations; no IM may maintain an investment equaling or exceeding eight (8) percent ownership in the equity security(ies) of any corporation, or group of directly affiliated corporations, without the written consent of the Board, nor may any International 12 of 19

Equity IM exceed four (4) percent ownership of the outstanding equity of any company or group of affiliated companies. 4. Any IM retained for this mandate shall purchase marketable foreign stocks traded on regulated foreign or U.S. stock exchanges for which trading activity is published on a daily basis and for which any IM can demonstrate necessary liquidity as well as acceptable investment quality standards. 5. The annualized total investment return from any portfolio of International Equity investments of the Fund is expected to meet or exceed after fees the annualized total return of an appropriate benchmark, to be agreed upon by any IM and the Board, for periods of three- to-five (3-5) years or more. In the absence of another selected benchmark, the Morgan Stanley C.I. “EAFE” Index shall serve as benchmark. 6. Because an active currency hedging strategy may reduce risk of loss and/or enhance IM International Equity investment performance, hedging to protect against currency impact upon a security position may be in the best interest of the Fund. Nevertheless, the purchase of speculative or “naked” currency contracts (i.e., “currency trading” or related risk taking undertaken without a demonstrable exposed investment position to be hedged in a specific currency) is prohibited. DOMESTIC FIXED INCOME INVESTMENT GUIDELINES The Board shall review the Fund portfolio at least quarterly to assure that the domestic fixed income securities market value limit of 40 percent is not exceeded. As necessary, any Custodian will be instructed by the Board to redirect investment and/or contribution cash flows to or from any IM or to accommodate immediate Board-ordered portfolio revisions to restore the asset allocation currently approved. Any IM retained for this mandate shall conform to the Domestic Fixed Income Investment Guidelines set forth above and below. Any departure from the Guidelines must be submitted in writing to the Board for prior approval, as must any change in the "style" or investment philosophy, process, or practices approved by the Board at the time any IM was retained to manage domestic fixed income securities of the Fund. Specific Guidelines, Domestic Intermediate Term Fixed Income 1. Full discretion, consistent with the Investment Objectives, Policies, and Guidelines set forth in this Statement, is granted to each IM retained to manage domestic intermediate term fixed income securities. 2. Any IM retained for this mandate is expected to select domestic intermediate term fixed income investments in conformity with the criteria normally applied in its decision making process and previously reviewed and approved by the Board. 3. Suitable domestic intermediate term fixed income investments include, but are not limited to, U.S. Treasury and Agency securities, marketable debt securities of U.S. corporations, U.S. certificates of deposit and bankers’ acceptances, and commercial paper or other 13 of 19

generally utilized money market or cash equivalent investments, including money market mutual funds meeting the quality standards delineated below. 4. Foreign fixed income securities, if rated Baa or above, including Canadian securities, denominated in U.S. dollars (i.e., foreign “Yankee” and Canadian U.S. pay securities) may be purchased to a limit of the applicable fixed income manager’s benchmark plus 5% at market value of any domestic intermediate term fixed income securities portfolio. 5. Permissible private placement (Rule 144a) securities, per General Guidelines, 2., p. 9 above, shall not exceed twenty (20) percent of the market value of any domestic intermediate term fixed income portfolio. Fixed income investments may not otherwise include unregistered, deep discount or zero coupon securities (excepting U.S. Treasury, see 12., p. 13, below), tax exempt, indirectly asset backed, spread-dependent, stripped, or otherwise derivative or synthetic securities. (See also 14., p. 14, below). 6. At no time shall margin or other leveraged transactions, short sales, forward or futures trading, or any form of portfolio hedging be employed in the management of domestic intermediate term fixed income investments. 7. The total annualized investment return of all domestic fixed income investments of the Fund is expected to meet or exceed the total annualized return of the Lehman Intermediate Government/Credit Index. 8. The average quality of domestic intermediate term fixed income securities purchased by any IM shall equal or exceed A, the third broad investment grade as determined by any nationally recognized and regulated general or specialty debt/credit rating agency (e.g., including but not limited to Moody's, Standard & Poor's, Fitch, Duff & Phelps, Thompson's Bank Watch). If commercial paper is purchased the single acceptable quality shall be A1 or P1 or "Prime,” with no second level considered. 9. The minimum quality of any single fixed income investment shall be investment grade, as defined by two out of three of the following rating agencies; Moody’s, Standard and Poors, or Fitch. If an investment is made in commercial paper, the single standard shall be A1 or P1 or “Prime.” 10. The average effective duration of domestic fixed income securities, said average including any investments considered to be reserve or cash equivalent assets specific to any fixed income portfolio, shall never be more than twelve (12) months greater or less than the most recently published average or effective duration of the fixed income policy benchmark. 11. There shall be no limit upon investment in U.S. Treasury securities as a percentage of domestic intermediate term fixed income investments at cost or market value, except that any single coupon issue thereof may constitute at purchase more than thirty (30) percent of domestic intermediate term fixed income portfolio at market value, nor any single Treasury zero coupon issue ten (10) percent at market value, with a per-portfolio collective limit for Treasury or Agency zero coupon securities of thirty (30) percent at market value and an eight (8) year effective duration limit for any zero coupon security. Federal Agency securities are hereby limited to forty (40) percent of any domestic intermediate term fixed income investment portfolio at market value, with a per-issue limit of ten (10) percent at 14 of 19

market value, excepting zero coupon Agency securities which shall be limited to five (5) percent per-issue at market value. Sharply lower limits are set for other types of securities. Without prior written Board approval, excepting Treasury and Agency securities: a. any single security issue shall not constitute more than five (5) percent, b. securities of any single issuer or of directly affiliated issuers shall not constitute more than seven (7) percent, c. securities of a recognized industry (e.g., steel, auto, aluminum, banking), or d. securities of a single broad issuer type (e.g., utility, finance, industrial), or e. of one structural or transaction type (e.g., mortgage-backed, asset-backed), f. shall not constitute more than twenty (20) percent of any domestic intermediate term fixed income securities portfolio at market value. Permissible Rule 144a securities shall also be limited to twenty (20) percent at market value. 12. Any domestic fixed income security purchased in compliance with the quality, maturity, and/or diversification standards cited in 3., through 12., above, but no longer meeting a specific, per-security Investment Guideline standard, and/or by marginal effect causing non-compliance (e.g., occasioning fixed income portfolio decline to sub-standard average quality), may in lieu of immediate depressed or inappropriate sale be reported to the Board, with background information and an intended future course of action, by any IM. The Board may upon review approve temporary or indefinite retention or, in the Board’s best judgment, order disposition of the security and a return to full compliance with the Investment Guidelines. Securities retained under such circumstances shall constitute no more than five (5) percent of the market value of domestic intermediate term fixed income securities (5% “basket clause”). 13. AAA-rated asset-backed securities and AAA-rated agency and private label mortgage- backed securities, including collateralized mortgage obligations limited to five (5) percent per-issue and ten (10) percent of the market value of any domestic intermediate term fixed income portfolio at the time of purchase, are suitable fixed income investments, provided said obligations afford no features which would increase volatility beyond that of the underlying collateral. (E.g., C.M.O. “floaters” indexed to the London Interbank Offering Rate or LIBOR would not be suitable investments.) 15 of 19

REVIEW PROCEDURES All Investment Policies, Objectives and Guidelines contained in this Statement shall be reviewed by the Board annually, or whenever circumstances change to the extent that earlier representations are ineffective or inappropriate. All concerned parties shall be notified in writing of any changes and/or additions. 1. Investment performance shall be reviewed quarterly. 2. Total Fund, asset class (e.g., domestic equity, international equity, domestic fixed income), and asset sub-class and/or “style” returns, shall be compared to universes of returns of comparable professionally managed tax-exempt balanced, equity and fixed income portfolios or collective or mutual funds as well as to benchmark indices or index composites. 3. It is expected that the investment performance of an IM will rank above any agreed upon universe median or index over periods of three-to-five (3-5) years and will meet or exceed the Investment Objectives identified in this Statement. 4. The Board reserves the right to terminate a relationship with any IM at any time, subject to the terms of any investment advisory agreement, if the Board determines that said action is warranted. In addition, the Board reserves the right to remove assets, in part, at any time provided that any contracted asset and/or fee minimum of any IM is met or a change is negotiated. 5. Any IM shall provide statements of assets under management to the Board quarterly, and shall also comply with reasonable additional information requests from the Board, including details of any/all securities transactions and/or “soft dollar” payments if said payments are made at official Board request and/or arise from transactions involving the Fund. 6. Any IM shall meet at least annually, if requested by the Board, to review the Total Fund and any respective portfolio(s) and to discuss investment results in the context of all of the goals, Objectives, Policies and Guidelines set forth in this Statement. 16 of 19

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AMENDMENT 1 The following amendment to the investment policy has been reviewed and approved by the Board: I. Allocation of Plan Assets -The plan will utilize a dynamic policy linked to funded status of the plan. As funded status improves to the next threshold, the allocation of the plan will be adjusted to the specified allocation. Within each threshold, 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 Dynamic Investment Policy Funded Status Asset Category 40% 70% 80% 85% 90% 95% 100% Cash & Short Term Bond 7% 7% 5% 5% 5% 5% 5% US Treasuries/Inflation-linked 2% 2% 4% 5% 7% 10% 13% Intermediate Term Bond 14% 15% 16% 18% 18% 21% 23% Long Term Bond 17% 19% 20% 23% 26% 30% 34% 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 5% 5% 5% 4% 4% 3% 3% Real Estate/REIT 5% 5% 5% 4% 4% 3% 3% Non-US Stock 10% 9% 9% 8% 7% 5% 3% Emerging Markets 15% 14% 13% 12% 10% 7% 5% Equity 60% 57% 55% 49% 45% 34% 25% Fixed Income/Cash 40% 43% 45% 51% 56% 66% 75% Total 100% 100% 100% 100% 101% 100% 100% II. Performance Monitoring Benchmarks - The plan will utilize asset category specific benchmarks to monitor investment manager performance. In addition, overall portfolio performance will be benchmarked to a normal portfolio composed of category indexes allocated based on the Dynamic Investment Policy funded status position. Asset Category Index Cash & Money Market CitiGroup 3 Month TBill Short-term Bond BofA Merrill Lynch 1-3 Yr Corp Intermediate-term Bond BarCap lnterm US Govt/Credit Long-term Bond BarCap Long GovtCredit Index Large Cap Value S&P/Citi 500Value Large Cap Blend S&P 500 Index Large Cap Growth S&P/Citi 500 Growth Mid Cap Value S&P/Citi Mid-Cap 400 Value Mid Cap S&P 400 Mid Cap Mid Cap Growth S&P/Citi Mid-Cap 400 Growth Small Cap Value S&P/Citi Small Cap 600 Value Small Cap S&P 600 Small Cap Small Cap Growth S&P/CitiSmall Cap 600 Growth MSCI ACWI xUS NR MSCI EAFE S&P EPACEMI MSCI EAFE Small Cap MSCI EM NR MSCI EM (Emerging Markets) REIT/Real Estate FTSE NAREIT Equity REIT 18 of 19

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Quarterly Investment Monitor Summary Report for the Quarter Ending December 31, 2012 Prepared for City of Dover, Delaware Police Pension Plan

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: Investment Committee Meeting Notes – 2/14/2013 Enclosures: Milliman Quarterly Investment Monitor Report (QIM) 1. Defined Benefit Pension Plan Investment Review through 12/31/2012: a. As of 12/31/2012, assets in the plan total $10.78 million, down from $11.01 at 9/30/2012. The plan had withdrawals of approximately $374k during the quarter. b. The plan asset allocation has been adjusted based on the investment policy approved during the Nov 8, 2012 meeting. c. Performance of the plan portfolio was slightly above the Plan normal portfolio index for the quarter, at +1.49% versus 1.16% for the plan index. Offices in Principal Cities Worldwide

City of Dover Police Pension Plan Quarterly Return Summary POLICE-NET POLICE GROSS- Month End BMV Contribution Withdrawls Fees Gain EMV RETURN RETURN 10/31/2012 $ 11,010,828.10 $ - $ 124,966.29 $ 456.19 $ (65,208.99) $ 10,820,196.63 -0.59% -0.57% 11/30/2012 $ 10,820,196.63 $ - $ 124,966.29 $ 451.73 $ 65,371.78 $ 10,760,150.39 0.60% 0.63% 12/31/2012 $ 10,760,150.39 $ - $ 124,966.29 $ 525.09 $ 151,307.37 $ 10,785,966.38 1.41% 1.43% $ - $ 374,898.87 $ 1,433.01 $ 151,470.16 Quarterly Return 1.42% 1.49% Milliman, Inc.

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

Quarterly Investment Monitor Market Indices - 4th Quarter 2012 3 1 3 5 Index Months Year Years Years BofAML US Treasury Bill 3 Mon 0.04 0.11 0.11 0.52 Barclays US Govt 1-3 Yr TR USD 0.07 0.51 1.49 2.49 Barclays US Govt/Credit Interm TR USD 0.35 3.89 5.19 5.18 Barclays US Government Long TR USD -0.71 3.78 13.62 9.58 Barclays US Long Credit TR USD 1.25 12.73 13.48 10.40 Barclays US Corporate High Yield TR USD 3.29 15.81 11.86 10.34 DJ Industrial Average TR USD -1.74 10.24 10.87 2.62 S&P 500 TR -0.38 16.00 10.87 1.66 NASDAQ 100 TR USD -4.50 18.35 13.80 5.89 NASDAQ Composite TR USD -2.65 17.45 11.19 3.68 Russell 1000 Value TR USD 1.52 17.51 10.86 0.59 Russell 1000 TR USD 0.12 16.42 11.12 1.92 Russell 1000 Growth TR USD -1.32 15.26 11.35 3.12 Russell 2000 Value TR USD 3.22 18.05 11.57 3.55 Russell 2000 TR USD 1.85 16.35 12.25 3.56 Russell 2000 Growth TR USD 0.45 14.59 12.82 3.49 FTSE NAREIT All REITs TR 2.19 20.14 18.03 5.60 MSCI EAFE NR USD 6.57 17.32 3.56 -3.69 MSCI EAFE Small Cap NR USD 6.01 20.00 7.17 -0.86 MSCI EM NR USD 5.58 18.22 4.66 -0.92 City of Dover, Delaware Police Pension Plan 3

Quarterly Investment Monitor Broad Market Commentary - 4th Quarter 2012 Broad Markets - Quarter Broad Markets - Five Years Oct-12 - Dec-12 Dec-07 - Dec-12 7 130 6 120 5 110 4 100 Total Return, % Growth of $100 3 90 2 80 1 70 0 -1 60 -2 50 -3 40 Oct-12 - Dec-12 Dec-07 Jun-08 Dec-08 Jun-09 Dec-09 Jun-10 Dec-10 Jun-11 Dec-11 Jun-12 Dec-12 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 was mixed on concerns about the presidential election, the “fiscal cliff” of automatic spending cuts and tax increases, and the resulting impact on the U.S. economy. · The international equity markets made substantial gains as investors became more confident in the European Central Bank's ability to address the European debt crisis and China's economy regained momentum. · The Federal Reserve Bank announced its intentions to increase its securities purchases (“QE3”) and keep short-term interest rates low until unemployment falls below 6.5% -- the first time it has tied rates to an economic milestone. · As the quarter ended, mutual fund investors increased their holdings in bonds and decreased their holdings in stocks. For the quarter, bond funds had net inflows of $68.2 billion, while stock funds had net outflows of $64.1 billion. Total money market mutual fund assets increased by $91.1 billion to $2.667 trillion. · The unemployment rate was unchanged at 7.8%, as total employment increased by 453,000 jobs. · The price of oil was unchanged at $92 per barrel. · For the three months ending December 31, 2012, annualized seasonally adjusted CPI – U was -0.7%. Falling prices for gasoline drove the decrease. City of Dover, Delaware Police Pension Plan 4

Quarterly Investment Monitor US Fixed Income Market Commentary - 4th Quarter 2012 US Fixed Income - Quarter US Fixed Income - Five Years Oct-12 - Dec-12 Dec-07 - Dec-12 4 170 160 150 3 140 Total Return, % Growth of $100 130 2 120 110 1 100 90 0 80 70 60 -1 Dec-07 Jun-08 Dec-08 Jun-09 Dec-09 Jun-10 Dec-10 Jun-11 Dec-11 Jun-12 Dec-12 Oct-12 - Dec-12 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 th · The broad fixed income market rose 0.21% in the 4 quarter, as the coupon return of 0.81% more than offset the negative impact from a 0.13% rise in interest rates. · The short end of the yield curve remained unchanged as the Fed maintained its near-zero interest rate policy. · Interest rates increased slightly from the 2- to the 30-year Treasury rates. · Emerging market bonds and high-yield bonds were the best performing sectors this quarter, up 3.29%, as investors favored bonds with higher yields. · Long-term corporate bonds were up 0.03%, as corporate credit spreads tightened sharply in response to strong demand from investors. · Long-term government bonds were the worst performing sector this quarter, down 0.94%, on lower demand for safe-haven assets. · 91-Day T-Bill returned 0.04% in the fourth quarter as compared with 0.03% in the third quarter. City of Dover, Delaware Police Pension Plan 5

Quarterly Investment Monitor US Equity Market Commentary - 4th Quarter 2012 US Equity - Quarter US Equity - Five Years Oct-12 - Dec-12 Dec-07 - Dec-12 4 130 120 3 110 2 100 Total Return, % Growth of $100 90 1 80 0 70 60 -1 50 -2 40 Oct-12 - Dec-12 Dec-07 Jun-08 Dec-08 Jun-09 Dec-09 Jun-10 Dec-10 Jun-11 Dec-11 Jun-12 Dec-12 Total Total Russell 1000 Value TR USD Russell 1000 TR USD Russell 1000 Value TR USD Russell 1000 TR USD Russell 1000 Growth TR USD Russell 2000 Value TR USD Russell 1000 Growth TR USD Russell 2000 Value TR USD Russell 2000 TR USD Russell 2000 Growth TR USD Russell 2000 TR USD Russell 2000 Growth TR USD US Stock Market · The major domestic equity indices were mixed for the quarter. The small-cap Russell 2000 Value Index had the best return, up 3.2%. · Small-cap stocks outperformed large-caps, up 1.9% vs. 0.1%. · In comparing styles, value stocks did better than growth stocks. · In a reversal from last quarter, REITs rose 2.31%, due to limited new supply, improving demand, and a low cost of capital. The best performing sectors were industrials and regional malls. · Financials were the best performing sector, up 5.12%, on continued monetary stimulus by the Fed, an improving housing market, and capital levels that appear to be adequate. · Telecommunication services were the worst performing sector, down 5.56%, as AT&T reported an unexpectedly large decline in subscriber growth. City of Dover, Delaware Police Pension Plan 6

Quarterly Investment Monitor International Market Commentary - 4th Quarter 2012 International - Quarter Oct-12 - Dec-12 7 International - Five Years 6 Dec-07 - Dec-12 Total Return, % 5 4 110 3 2 100 1 90 0 Growth of $100 80 MSCI EAFE NR USD MSCI EAFE Small Cap NR USD MSCI EM NR USD 70 Regional Performance - Quarter Oct-12 - Dec-12 60 9 8 50 7 Total Return, % 6 5 40 4 Dec-07 Jun-08 Dec-08 Jun-09 Dec-09 Jun-10 Dec-10 Jun-11 Dec-11 Jun-12 Dec-12 3 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 euro and pound, but up strongly against the yen. · For the quarter, the EAFE Index was up 6.57% and Emerging Markets were up 5.58%. Local currency returns for the EAFE Index and Emerging Markets were 7.52% and 5.33%, respectively. · Among the major international regions, Chinese stocks had the highest return (+12.43%), helped by a more positive economic outlook for China. · Stocks in Europe (except for the U.K.) also rose substantially (+8.62%), as the European Central Bank provided stimulus and guided recovery efforts in debt-ridden countries. · Small-cap stocks, up 6.0%, underperformed large-cap stocks, up 6.6%. City of Dover, Delaware Police Pension Plan 7

Quarterly Investment Monitor Data as of 12/31/2012 Performance Summary City of Dover, Delaware Police Pension Plan 8

Quarterly Investment Monitor Data as of 12/31/2012 Asset Allocation Balances As of Percent As of Balances As of Percent As of Notes 12/31/2012 12/31/2012 09/30/2012 09/30/2012 Wells Fargo Advantage Treas Plus MMkt I $429,058 3.98% $547,697 5.00% PISXX Vanguard Short-Term Bond Index Signal $322,801 2.99% $2,188,466 19.99% VBSSX Vanguard Interm-Term Bond Index Signal $1,511,567 14.01% $1,108,037 10.12% VIBSX Vanguard Inflation-Protected Secs I $220,519 2.04% $0 0.00% VIPIX Vanguard Long-Term Bond Index I $921,303 8.54% $0 0.00% VBLLX PIMCO Long Duration Total Return Instl $917,209 8.50% $0 0.00% PLRIX Target Small Capitalization Value T $537,119 4.98% $0 0.00% TASVX Vanguard Equity-Income Adm $1,062,838 9.85% $1,545,348 14.11% VEIRX Vanguard Morgan Growth Adm $533,799 4.95% $776,642 7.09% VMRAX Vanguard PRIMECAP Inv $531,495 4.93% $608,235 5.55% VPMCX Vanguard Mid-Cap Value Index Admiral $535,853 4.97% $974,067 8.90% VMVAX DFA US Targeted Value I $0 0.00% $549,775 5.02% DFFVX DFA International Value I $0 0.00% $726,665 6.64% DFIVX American Funds New Perspective R6 $535,947 4.97% $993,704 8.53% RNPGX Harding Loevner Global Equity Inst $532,476 4.94% $991,777 9.06% HLMVX Vanguard Emerging Mkts Stock Idx I $1,649,658 15.29% $0 0.00% VEMIX Vanguard REIT Index I $545,398 5.06% $0 0.00% VGSNX Plan Total $10,787,041 $11,010,413 City of Dover, Delaware Police Pension Plan 9

Quarterly Investment Monitor Data as of 12/31/2012 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 31 34 -0.08 -0.22 1.01 1.01 55 46 46 31 PIMCO Long Duration Total Return Instl 31 13 -0.21 1.46 0.93 0.97 81 56 63 25 Target Small Capitalization Value T 52 19 -2.09 0.10 0.92 0.90 27 29 18 17 Vanguard Equity-Income Adm 2 8 2.61 3.37 0.82 0.84 2 2 8 8 Vanguard Morgan Growth Adm 34 49 -1.16 -2.04 1.18 1.14 47 44 51 48 Vanguard PRIMECAP Inv 68 19 -2.83 -0.37 1.06 1.06 56 58 20 20 American Funds New Perspective R6 27 19 1.68 2.85 0.95 0.92 34 27 20 20 Harding Loevner Global Equity Inst 36 21 0.96 2.65 0.96 0.94 41 40 21 21 Definitions Return Rank - Fund's category percentile return rank, a value less than 50 (1 is the best and 100 is the worst) implies the fund is beating more than 50% of its peer group. Excess Return - Fund's excess return over its benchmark, a value greater than 0 implies the fund's return is higher than its benchmark. Relative StdDev - Fund's standard deviation relative to its benchmark, a value less than 1 implies the fund's standard deviation is lower than its benchmark. Alpha Rank - Fund's category percentile Alpha rank, a value less than 50 (1 is the best and 100 is the worst) implies the fund is beating more than 50% of its peer group. Sharpe Rank - Fund's category percentile Sharpe Ratio rank, a value less than 50 (1 is the best and 100 is the worst) implies the fund is beating more than 50% of its peer group. City of Dover, Delaware Police Pension Plan 10

Quarterly Investment Monitor Data as of 12/31/2012 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 1.17 0.92 1.79 0.73 1.51 0.89 0.11 Vanguard Interm-Term Bond Index Signal -0.06 0.03 1.02 0.35 1.02 0.43 0.11 Vanguard Long-Term Bond Index I -0.06 0.03 1.04 0.94 1.02 0.83 0.07 Vanguard Mid-Cap Value Index Admiral -0.59 1.05 0.93 2.60 0.98 4.28 0.10 Vanguard Emerging Mkts Stock Idx I 0.17 0.10 1.01 3.06 1.01 3.34 0.13 Vanguard REIT Index I 1.32 2.00 1.00 0.20 0.99 0.55 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

Quarterly Investment Monitor Data as of 12/31/2012 Investment Option Return Summary Asset Fund 3 1 3 5 10 Mstar Expense YTD Ticker Class Name Months Year Years Years Years Rating Ratio Taxable Money Market Wells Fargo Advantage Treas Plus MMkt I 0.00 0.01 0.01 0.01 0.32 1.61 PISXX NA 0.20 BofA ML 3-month T-bill total return Index 0.04 0.11 0.11 0.11 0.52 1.78 N/A NA NA Short-term Bond Vanguard Short-Term Bond Index Signal 0.15 2.05 2.05 3.05 3.80 3.67 VBSSX 3.00 0.11 Barclays US Govt/Credit 1-3 Yr TR USD 0.15 1.26 1.26 1.88 2.88 3.13 N/A NA NA Intermediate-term Bond Vanguard Interm-Term Bond Index Signal 0.46 7.02 7.02 9.07 7.81 6.30 VIBSX 5.00 0.11 Barclays US Govt/Credit 5-10 Yr TR USD 0.65 7.21 7.21 9.13 7.78 6.31 N/A NA NA Inflation-Protected Bond Vanguard Inflation-Protected Secs I 0.57 6.87 6.87 8.82 6.81 6.50 VIPIX 4.00 0.07 Barclays US Treasury US TIPS TR USD 0.69 6.98 6.98 8.90 7.04 6.65 N/A NA NA Long-term Bond Vanguard Long-Term Bond Index I 0.11 8.55 8.55 13.58 10.19 7.93 VBLLX 3.00 0.07 Long-term Bond PIMCO Long Duration Total Return Instl 0.44 10.28 10.28 13.44 11.62 NA PLRIX 4.00 0.50 BC Long Government/Credit 0.45 8.78 8.78 13.65 10.16 7.96 N/A NA NA Small Value Target Small Capitalization Value T 3.75 14.14 14.14 11.98 5.24 11.86 TASVX 4.00 0.71 S&P 600 Index 2.22 16.33 16.33 14.07 5.14 10.45 N/A NA NA Large Value Vanguard Equity-Income Adm 0.14 13.58 13.58 13.07 3.22 8.26 VEIRX 5.00 0.22 S&P 500 Value 1.64 17.68 17.68 10.47 (0.15) 7.14 N/A NA NA Large Growth Vanguard Morgan Growth Adm (0.95) 15.25 15.25 10.17 1.35 7.94 VMRAX 4.00 0.30 Large Growth Vanguard PRIMECAP Inv 2.56 15.27 15.27 8.50 3.03 9.90 VPMCX 4.00 0.45 S&P 500 Growth (2.04) 14.61 14.61 11.33 3.39 7.00 N/A NA NA Mid-Cap Value Vanguard Mid-Cap Value Index Admiral 3.56 16.02 16.02 12.10 4.23 NA VMVAX 3.00 0.10 MSCI US Mid Cap 450 Index USD 2.84 16.04 16.04 12.68 3.19 10.43 N/A NA NA World Stock American Funds New Perspective R6 4.21 21.19 21.19 8.30 1.69 10.16 RNPGX 4.00 0.46 World Stock Harding Loevner Global Equity Inst 1.07 17.42 17.42 7.58 1.49 9.32 HLMVX 3.00 0.95 MSCI AC World Index ND USD 2.88 16.13 16.13 6.63 (1.16) 8.11 N/A NA NA Diversified Emerging Mkts Vanguard Emerging Mkts Stock Idx I 6.84 18.90 18.90 4.83 (0.81) 16.41 VEMIX 3.00 0.13 MSCI EM NR USD 5.58 18.22 18.22 4.66 (0.92) 16.52 N/A NA NA Real Estate Vanguard REIT Index I 2.50 17.65 17.65 18.03 6.11 11.71 VGSNX 3.00 0.08 MSCI US REIT NR USD 2.17 16.47 16.47 16.70 4.11 NA N/A NA NA Total Plan POLICE GROSS-RETURN 1.49 10.71 10.71 7.10 3.31 NA N/A NA NA Total Plan POLICE-NET RETURN 1.42 10.39 10.39 6.80 3.01 NA N/A NA NA Police Plan Policy Index 1.16 12.22 12.22 8.38 2.84 7.03 N/A NA NA City of Dover, Delaware Police Pension Plan 12

Quarterly Investment Monitor Data as of 12/31/2012 U.S. Fixed Income Style Map 36 Month moving average, Jan-08 - Dec-12 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 Interm-Term Bond Index Signal Vanguard Inflation-Protected Secs I Vanguard Long-Term Bond Index I PIMCO Long Duration Total Return Instl City of Dover, Delaware Police Pension Plan 13

Quarterly Investment Monitor Data as of 12/31/2012 U.S. Equity Style Map 36 Month moving average, Jan-08 - Dec-12 LgValue LgGrowth Small - Large MidValue MidGrowth SmValue SmGrowth Value - Growth S&P/BARRA Style Indices Target Small Capitalization Value T Vanguard Equity-Income Adm Vanguard Morgan Growth Adm Vanguard PRIMECAP Inv Vanguard Mid-Cap Value Index Admiral Vanguard REIT Index I City of Dover, Delaware Police Pension Plan 14

Quarterly Investment Monitor Data as of 12/31/2012 International Equity Style Map 36 Month moving average, Jan-08 - Dec-12 Europe Large Asia Pacific Large Small - Large Europe Small Asia Pacific Small European Emerging Asia Pacific Emerging Europe - Asia SBI Equity Indices American Funds New Perspective R6 Harding Loevner Global Equity Inst Vanguard Emerging Mkts Stock Idx I City of Dover, Delaware Police Pension Plan 15

Quarterly Investment Monitor Data as of 12/31/2012 Core Fund Review City of Dover, Delaware Police Pension Plan 16

Quarterly Investment Monitor Data as of 12/31/2012 Vanguard Short-Term Bond Index Signal 4.33 Portfolio Information Investment Strategy Summary 9.93 % Cash Ticker VBSSX % US Stocks The investment seeks to track the performance of a market-weighted bond index with a Morningstar Category Short-term Bond % Bonds short-term dollar-weighted average maturity. The fund employs an indexing investment Avg Mkt Cap $MM NA % Non-US Stocks approach designed to track the performance of the Barclays Capital U.S. 1-5 Year Cat Med Mkt Cap $MM 9418.10 % Pref Government/Credit Float Adjusted Index. It invests by sampling the index. The fund invests Net Assets $MM 26204.17 at least 80% of assets in bonds held in the index. It maintains a dollar-weighted average % Conv Turnover Ratio 67.00 maturity consistent with that of the index, which generally does not exceed 3 years. % Other % Assets in Top 10 Holdings 14.81 % Non-US Bonds Total Number of Holdings 1468.00 _________________________________________________________________________ Manager Name Gregory Davis Manager Tenure 7.92 85.70 Fund Incept Date 03/01/1994 Prospectus Exp Ratio 0.11 Phone Number 800-662-7447 Performance vs. Peer Group Portfolio Region Portfolio Structure Closed to New Investors No % United States NA % Cash 4.33 8 % Canada NA % US Stocks 0.00 % Latin America NA % Bonds 85.70 7 % United Kingdom NA % Non-US Stocks 0.00 % Eurozone NA % Pref 0.04 Portfolio Ratings 6 Total Annualized Return, % % Europe - ex Euro NA % Conv 0.00 Mstar Rating % Europe - Emerging NA % Other 0.00 3 Year Mstar Rating % Africa NA % Non-US Bonds 9.93 % Rank Cat 3 Yr 49 5 % Middle East NA 5 Year Mstar Rating % Japan NA % Rank Cat 5 Yr 32 4 % Australasia NA 10 Year Mstar Rating % Asia - Developed NA % Rank Cat 10 Yr 29 % Asia - Emerging NA 3 2 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group % Basic Materials NA Avg Eff Duration 2.69 2 350 1 % Communication Services NA Effective Maturity 2.80 % Consumer Cyclical NA Avg Credit Quality AA 0 % Consumer Defensive NA US Govt/ Agency NA 300 % Healthcare NA AAA 74.95 % Industrials NA AA 6.08 -1 3 Months YTD 1 Year 3 Years 5 Years % Real Estate NA A 11.10 250 % Technology NA BBB 7.87 % Energy NA BB 0.00 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services NA B 0.00 Median to 75th Percentile 75th to 95th Percentile Ratio 200 % Utilities NA Below B 0.00 Vanguard Short-Term Bond Index Signal Barclays US Govt/Credit 1-3 Yr TR USD NR/NA 0.00 1 Turnover 150 3 Year to 1 3 5 Top Ten Holdings Performance Months Date Year Years Years US Treasury Note 0.625% 1.98% Vanguard Short-Term Bond Index Signal 0.15 2.05 2.05 3.05 3.80 US Treasury Note 2.5% 1.58% 100 Barclays US Govt/Credit 1-3 Yr TR USD 0.15 1.26 1.26 1.88 2.88 US Treasury Note 2.625% 1.57% Universe(5%) 1.35 7.52 7.52 6.17 5.72 US Treasury Note 1% 1.56% Universe(25%) 0.63 4.70 4.70 3.88 4.25 US Treasury Note 0.875% 1.48% 50 Universe(Median) 0.42 3.87 3.87 3.02 3.43 US Treasury Note 1.75% 1.42% Universe(75%) 0.13 2.48 2.48 2.42 2.83 US Treasury Note 2.375% 1.38% Universe(95%) -0.08 1.17 1.17 1.24 1.08 US Treasury Note 0.25% 1.33% 0 0 US Treasury Note 0.25% 1.27% Prospectus Exp Ratio Turnover Ratio US Treasury Note 0.625% 1.24% City of Dover, Delaware Police Pension Plan 17

Quarterly Investment Monitor Data as of 12/31/2012 Vanguard Short-Term Bond Index Signal Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 20 0 15 25 Total Return Rank, % 10 50 Total Return, % 5 75 0 -5 100 Jan-06 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 -10 Up/Down Market Capture Ratio -15 Jan-10 - Dec-12 450 -20 400 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 350 Up Mkt Capture Ratio, % Vanguard Short-Term Bond Index Signal Barclays US Govt/Credit 1-3 Yr TR USD 300 Annual Return % 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 250 Vanguard Short-Term Bond Index Signal 3.37 1.70 1.31 4.09 7.28 5.51 4.38 4.03 3.08 2.05 200 Barclays US Govt/Credit 1-3 Yr TR USD 2.81 1.30 1.77 4.25 6.83 4.97 3.83 2.80 1.59 1.26 150 100 50 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 3 3 3 3 0 -500 -400 -300 -200 -100 0 100 200 300 400 500 Down Mkt Capture Ratio, % 2 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 Sharpe Ratio Alpha, % 1 Return vs. Risk 1 1 1 Jan-10 - Dec-12 0 11 10 9 Total Annualized Return, % -1 0 0 0 8 7 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile Vanguard Short-Term Bond Index Signal Barclays US Govt/Credit 1-3 Yr TR USD 6 5 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 3 Vanguard Short-Term Bond Index Signal -0.24 1.79 90.08 2.10 1.39 0.73 2 Barclays US Govt/Credit 1-3 Yr TR USD 0.00 1.00 100.00 2.39 0.73 0.00 1 Universe(5%) 2.74 2.26 89.65 2.99 2.81 2.67 0 0 1 2 3 4 Universe(25%) 1.23 1.72 74.64 2.60 1.84 1.47 Universe(Median) 0.63 1.30 57.73 2.18 1.37 0.99 Total Annualized StdDev, % Universe(75%) 0.17 1.10 39.55 1.89 1.03 0.63 Morningstar Short Term Bond Universe Vanguard Short-Term Bond Index Signal Universe(95%) -0.62 0.75 11.96 1.11 0.75 0.32 Cash Barclays US Govt/Credit 1-3 Yr TR USD City of Dover, Delaware Police Pension Plan 18

Quarterly Investment Monitor Data as of 12/31/2012 Vanguard Interm-Term Bond Index Signal Portfolio Information Investment Strategy Summary 11.40 % Cash Ticker VIBSX % US Stocks The investment seeks to track the performance of a market-weighted bond index with an Morningstar Category Intermediate-term Bond % Bonds intermediate-term dollar-weighted average maturity. The fund employs an indexing Avg Mkt Cap $MM NA % Non-US Stocks investment approach designed to track the performance of the Barclays U.S. 5-10 Year Cat Med Mkt Cap $MM 18030.59 % Pref Government/Credit Float Adjusted Index. This index includes all medium and larger issues of Net Assets $MM 17226.63 U.S. government, investment-grade corporate, and investment-grade international % Conv Turnover Ratio 61.00 dollar-denominated bonds that have maturities between 5 and 10 years and are publicly % Other % Assets in Top 10 Holdings 25.50 issued. All of its investments will be selected through the sampling process, and at least % Non-US Bonds Total Number of Holdings 1374.00 80% of its assets will be invested in bonds held in the index. Manager Name Joshua C. Barrickman 87.63 Manager Tenure 4.69 _________________________________________________________________________ Fund Incept Date 03/01/1994 Prospectus Exp Ratio 0.11 Phone Number 800-662-7447 Performance vs. Peer Group Portfolio Region Portfolio Structure Closed to New Investors No % United States NA % Cash 0.97 10 % Canada NA % US Stocks 0.00 % Latin America NA % Bonds 87.63 9 % United Kingdom NA % Non-US Stocks 0.00 % Eurozone NA % Pref 0.00 Portfolio Ratings 8 Total Annualized Return, % % Europe - ex Euro NA % Conv 0.00 Mstar Rating % Europe - Emerging NA % Other 0.00 3 Year Mstar Rating 7 % Africa NA % Non-US Bonds 11.40 % Rank Cat 3 Yr 10 % Middle East NA 5 Year Mstar Rating 6 % Japan NA % Rank Cat 5 Yr 13 % Australasia NA 10 Year Mstar Rating % Asia - Developed NA % Rank Cat 10 Yr 14 5 % Asia - Emerging NA 4 3 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group % Basic Materials NA Avg Eff Duration 6.46 300 2 % Communication Services NA Effective Maturity 7.30 % Consumer Cyclical NA Avg Credit Quality A % Consumer Defensive NA US Govt/ Agency NA 1 0.5 250 % Healthcare NA AAA 53.14 % Industrials NA AA 4.91 0 3 Months YTD 1 Year 3 Years 5 Years % Real Estate NA A 20.67 % Technology NA BBB 21.28 0.4 200 % Energy NA BB 0.00 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services NA B 0.00 Median to 75th Percentile 75th to 95th Percentile % Utilities NA Below B 0.00 Ratio Vanguard Interm-Term Bond Index Signal Barclays US Govt/Credit 5-10 Yr TR USD NR/NA 0.00 0.3 150 Turnover 3 Year to 1 3 5 Top Ten Holdings Performance Months Date Year Years Years US Treasury Note 3.5% 3.17% 0.2 100 Vanguard Interm-Term Bond Index Signal 0.46 7.02 7.02 9.07 7.81 US Treasury Note 3.625% 3.10% Barclays US Govt/Credit 5-10 Yr TR USD 0.65 7.21 7.21 9.13 7.78 US Treasury Note 3.625% 2.92% Universe(5%) 0.26 5.28 5.28 7.08 6.62 US Treasury Note 3.125% 2.76% Universe(25%) 0.12 4.08 4.08 6.04 6.00 0.1 50 US Treasury Note 3.375% 2.47% Universe(Median) 0.10 4.05 4.05 5.96 5.74 US Treasury Note 1.625% 2.36% Universe(75%) 0.05 3.91 3.91 5.87 5.64 US Treasury Note 2.625% 2.34% Universe(95%) 0.00 3.79 3.79 5.71 4.75 US Treasury Note 2% 2.21% 0.0 0 US Treasury Note 2.125% 2.14% Prospectus Exp Ratio Turnover Ratio US Treasury Note 3.75% 2.04% City of Dover, Delaware Police Pension Plan 19

Quarterly Investment Monitor Data as of 12/31/2012 Vanguard Interm-Term Bond Index Signal Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 11 0 10 25 Total Return Rank, % 9 8 50 7 Total Return, % 6 75 5 4 100 Jan-06 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 3 2 Up/Down Market Capture Ratio 1 Jan-10 - Dec-12 110 0 100 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 90 Up Mkt Capture Ratio, % Vanguard Interm-Term Bond Index Signal Barclays US Govt/Credit 5-10 Yr TR USD 80 70 Annual Return % 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 60 Vanguard Interm-Term Bond Index Signal 5.65 5.22 1.75 3.91 7.66 5.01 6.89 9.49 10.73 7.02 50 Barclays US Govt/Credit 5-10 Yr TR USD 5.97 5.30 1.83 3.81 7.55 5.06 6.50 9.42 10.79 7.21 40 30 20 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 10 3 5 2 0 0 20 40 60 80 100 120 0.6 Down Mkt Capture Ratio, % 0.5 4 Morningstar IntermTerm Bond Index Universe Vanguard Interm-Term Bond Index Signal Total Annualized StdDev, % Excess Annualized StdDev, % 0.4 Barclays US Govt/Credit 5-10 Yr TR USD 2 0.3 3 Sharpe Ratio Alpha, % 0.2 1 0.1 2 Return vs. Risk 1 0.0 Jan-10 - Dec-12 10 -0.1 1 9 -0.2 8 Total Annualized Return, % -0.3 0 0 0 7 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 6 Vanguard Interm-Term Bond Index Signal Barclays US Govt/Credit 5-10 Yr TR USD 5 4 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error Vanguard Interm-Term Bond Index Signal -0.21 1.02 99.29 2.15 4.03 0.35 2 Barclays US Govt/Credit 5-10 Yr TR USD 0.00 1.00 100.00 2.21 3.95 0.00 1 Universe(5%) 0.65 0.76 96.08 2.39 3.08 1.76 0 0 1 2 3 4 5 Universe(25%) 0.49 0.61 93.58 2.34 2.50 1.71 Universe(Median) 0.41 0.60 93.42 2.30 2.46 1.70 Total Annualized StdDev, % Universe(75%) 0.32 0.60 92.90 2.26 2.43 1.68 Morningstar IntermTerm Bond Index Universe Vanguard Interm-Term Bond Index Signal Universe(95%) -0.02 0.59 91.87 2.17 2.42 1.17 Cash Barclays US Govt/Credit 5-10 Yr TR USD City of Dover, Delaware Police Pension Plan 20

Quarterly Investment Monitor Data as of 12/31/2012 Vanguard Inflation-Protected Secs I Portfolio Information Investment Strategy Summary % Cash Ticker VIPIX % US Stocks The investment seeks to provide inflation protection and income consistent with investment Morningstar Category Inflation-Protected Bond % Bonds in inflation-indexed securities. The fund invests at least 80% of its assets in Avg Mkt Cap $MM NA % Non-US Stocks inflation-indexed bonds issued by the U.S. government, its agencies and instrumentalities, Cat Med Mkt Cap $MM 13018.99 % Pref and corporations. It may invest in bonds of any maturity; however, its dollar-weighted Net Assets $MM 44577.78 average maturity is expected to be in the range of 7 to 20 years. At a minimum, all bonds % Conv Turnover Ratio 28.00 purchased by the fund will be rated "investment grade" or, if unrated, will be considered by % Other % Assets in Top 10 Holdings 46.11 the advisor to be investment grade. % Non-US Bonds Total Number of Holdings 34.00 Manager Name Gemma Wright-Casparius _________________________________________________________________________ Manager Tenure 1.37 99.98 Fund Incept Date 06/29/2000 Prospectus Exp Ratio 0.07 Phone Number 800-662-7447 Performance vs. Peer Group Portfolio Region Portfolio Structure Closed to New Investors No % United States NA % Cash 0.02 11 % Canada NA % US Stocks 0.00 % Latin America NA % Bonds 99.98 10 % United Kingdom NA % Non-US Stocks 0.00 % Eurozone NA % Pref 0.00 Portfolio Ratings 9 Total Annualized Return, % % Europe - ex Euro NA % Conv 0.00 Mstar Rating % Europe - Emerging NA % Other 0.00 3 Year Mstar Rating 8 % Africa NA % Non-US Bonds 0.00 % Rank Cat 3 Yr 16 % Middle East NA 5 Year Mstar Rating 7 % Japan NA % Rank Cat 5 Yr 28 % Australasia NA 10 Year Mstar Rating 6 % Asia - Developed NA % Rank Cat 10 Yr 21 % Asia - Emerging NA 5 4 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 3 % Basic Materials NA Avg Eff Duration 8.50 1.0 450 % Communication Services NA Effective Maturity 9.40 2 % Consumer Cyclical NA Avg Credit Quality Government 0.9 400 % Consumer Defensive NA US Govt/ Agency NA 1 % Healthcare NA AAA 99.99 0.8 % Industrials NA AA 0.01 350 0 3 Months YTD 1 Year 3 Years 5 Years % Real Estate NA A 0.00 0.7 % Technology NA BBB 0.00 300 % Energy NA BB 0.00 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services NA B 0.00 0.6 Median to 75th Percentile 75th to 95th Percentile % Utilities NA Below B 0.00 Ratio 250 Vanguard Inflation-Protected Secs I Barclays US Treasury US TIPS TR USD NR/NA 0.00 0.5 Turnover 200 0.4 3 Year to 1 3 5 Top Ten Holdings Performance Months Date Year Years Years US Treasury Note 1.125% 5.49% 150 0.3 Vanguard Inflation-Protected Secs I 0.57 6.87 6.87 8.82 6.81 US Treasury Note 0.125% 5.34% Barclays US Treasury US TIPS TR USD 0.69 6.98 6.98 8.90 7.04 US Treasury Note 5.33% 100 Universe(5%) 1.15 9.78 9.78 10.61 7.71 US Treasury Note 5.21% 0.2 Universe(25%) 0.79 7.45 7.45 8.96 6.84 US Treasury Note 4.55% Universe(Median) 0.59 6.59 6.59 8.36 6.63 US Treasury Bond 3.875% 4.53% 0.1 50 Universe(75%) 0.51 6.31 6.31 8.08 6.06 US Treasury Note 1.25% 4.09% Universe(95%) 0.18 4.58 4.58 5.39 4.35 US Treasury Bond 2.375% 3.97% 0.0 0 US Treasury Note 3.91% Prospectus Exp Ratio Turnover Ratio US Treasury Note 2% 3.69% City of Dover, Delaware Police Pension Plan 21

Quarterly Investment Monitor Data as of 12/31/2012 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 Jan-06 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 -5 Up/Down Market Capture Ratio -10 Jan-10 - Dec-12 200 -15 180 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 160 Up Mkt Capture Ratio, % Vanguard Inflation-Protected Secs I Barclays US Treasury US TIPS TR USD 140 120 Annual Return % 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 100 Vanguard Inflation-Protected Secs I 8.00 8.25 2.78 0.46 11.82 -2.81 11.03 6.33 13.39 6.87 80 Barclays US Treasury US TIPS TR USD 8.40 8.46 2.84 0.41 11.64 -2.35 11.41 6.31 13.56 6.98 60 40 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 20 1 3 6 4 0 0 20 40 60 80 100 120 140 160 180 200 Down Mkt Capture Ratio, % 5 3 Morningstar Inflation Proteced Bond Universe Vanguard Inflation-Protected Secs I Total Annualized StdDev, % Excess Annualized StdDev, % 0 2 4 Barclays US Treasury US TIPS TR USD Sharpe Ratio Alpha, % 3 2 Return vs. Risk -1 1 2 Jan-10 - Dec-12 1 16 1 14 Total Annualized Return, % 12 -2 0 0 0 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 10 Vanguard Inflation-Protected Secs I Barclays US Treasury US TIPS TR USD 8 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 6 Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error 4 Vanguard Inflation-Protected Secs I -0.12 1.01 99.03 1.90 4.45 0.44 2 Barclays US Treasury US TIPS TR USD 0.00 1.00 100.00 1.94 4.40 0.00 Universe(5%) 0.94 1.03 99.19 2.12 5.18 3.28 0 0 1 2 3 4 5 6 7 8 9 Universe(25%) 0.40 1.00 98.72 1.96 4.42 1.33 Universe(Median) 0.01 0.97 98.07 1.89 4.33 0.64 Total Annualized StdDev, % Universe(75%) -0.39 0.92 91.88 1.84 4.16 0.51 Morningstar Inflation Proteced Bond Universe Vanguard Inflation-Protected Secs I Universe(95%) -1.20 0.63 69.31 1.27 3.75 0.40 Cash Barclays US Treasury US TIPS TR USD City of Dover, Delaware Police Pension Plan 22

Quarterly Investment Monitor Data as of 12/31/2012 Vanguard Long-Term Bond Index I Portfolio Information Investment Strategy Summary 12.36 % Cash Ticker VBLLX % US Stocks The investment seeks to track the performance of a market-weighted bond index with a Morningstar Category Long-term Bond % Bonds long-term dollar-weighted average maturity. The fund employs an indexing investment Avg Mkt Cap $MM NA % Non-US Stocks approach designed to track the performance of the Barclays Capital U.S. Long Cat Med Mkt Cap $MM 45740.49 % Pref Government/Credit Float Adjusted Index. It invests at least 80% of assets in bonds held in Net Assets $MM 5709.27 the index. The fund maintains a dollar-weighted average maturity consistent with that of the % Conv Turnover Ratio 45.00 index, which generally ranges between 15 and 30 years. % Other % Assets in Top 10 Holdings 23.73 % Non-US Bonds Total Number of Holdings 1385.00 _________________________________________________________________________ Manager Name Gregory Davis 86.71 Manager Tenure 4.69 Fund Incept Date 03/01/1994 Prospectus Exp Ratio 0.07 Phone Number 800-662-7447 Performance vs. Peer Group Portfolio Region Portfolio Structure Closed to New Investors No % United States NA % Cash 0.90 20 % Canada NA % US Stocks 0.00 % Latin America NA % Bonds 86.71 18 % United Kingdom NA % Non-US Stocks 0.00 % Eurozone NA % Pref 0.03 Portfolio Ratings 16 Total Annualized Return, % % Europe - ex Euro NA % Conv 0.00 Mstar Rating % Europe - Emerging NA % Other 0.00 3 Year Mstar Rating 14 % Africa NA % Non-US Bonds 12.36 % Rank Cat 3 Yr 29 % Middle East NA 5 Year Mstar Rating 12 % Japan NA % Rank Cat 5 Yr 42 % Australasia NA 10 Year Mstar Rating 10 % Asia - Developed NA % Rank Cat 10 Yr 50 % Asia - Emerging NA 8 6 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 4 % Basic Materials NA Avg Eff Duration 14.79 2 400 % Communication Services NA Effective Maturity 24.10 2 % Consumer Cyclical NA Avg Credit Quality A % Consumer Defensive NA US Govt/ Agency NA 350 0 % Healthcare NA AAA 43.45 % Industrials NA AA 7.27 -2 300 3 Months YTD 1 Year 3 Years 5 Years % Real Estate NA A 23.60 % Technology NA BBB 25.68 % Energy NA BB 0.00 250 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services NA B 0.00 Median to 75th Percentile 75th to 95th Percentile % Utilities NA Below B 0.00 Ratio Vanguard Long-Term Bond Index I BC Long Government/Credit NR/NA 0.00 1 200 Turnover 3 Year to 1 3 5 Top Ten Holdings 150 Performance Months Date Year Years Years US Treasury Bond 4.375% 3.25% Vanguard Long-Term Bond Index I 0.11 8.55 8.55 13.58 10.19 US Treasury Bond 4.25% 2.73% BC Long Government/Credit 0.45 8.78 8.78 13.65 10.16 100 US Treasury Bond 3% 2.55% Universe(5%) 2.64 18.09 18.09 16.94 13.61 US Treasury Bond 4.375% 2.42% Universe(25%) 1.51 12.89 12.89 13.45 10.82 US Treasury Bond 3.125% 2.36% 50 Universe(Median) 1.12 10.63 10.63 10.28 8.74 US Treasury Bond 4.5% 2.27% Universe(75%) 0.38 6.87 6.87 9.39 5.96 US Treasury Bond 4.375% 2.16% Universe(95%) -0.99 2.85 2.85 4.12 3.84 US Treasury Bond 4.75% 2.16% 0 0 US Treasury Bond 4.625% 1.96% Prospectus Exp Ratio Turnover Ratio US Treasury Bond 4.25% 1.86% City of Dover, Delaware Police Pension Plan 23

Quarterly Investment Monitor Data as of 12/31/2012 Vanguard Long-Term Bond Index I Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 40 0 30 25 Total Return Rank, % 20 50 Total Return, % 10 75 0 100 Jan-06 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 -10 Up/Down Market Capture Ratio -20 Jan-10 - Dec-12 250 -30 225 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 200 Up Mkt Capture Ratio, % Vanguard Long-Term Bond Index I BC Long Government/Credit 175 150 Annual Return % 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 125 Vanguard Long-Term Bond Index I 5.50 8.40 5.32 2.75 6.71 8.77 1.91 10.43 22.23 8.55 100 BC Long Government/Credit 5.87 8.56 5.33 2.71 6.60 8.44 1.92 10.16 22.49 8.78 75 50 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 25 12 3 12 14 0 -150 -100 -50 0 50 100 150 200 250 300 350 10 12 Down Mkt Capture Ratio, % 10 8 Morningstar Long Term Bond Universe Vanguard Long-Term Bond Index I Total Annualized StdDev, % Excess Annualized StdDev, % 10 2 8 BC Long Government/Credit 6 Sharpe Ratio 8 Alpha, % 4 6 6 Return vs. Risk 2 1 4 Jan-10 - Dec-12 4 0 25 2 -2 2 20 Total Annualized Return, % -4 0 0 0 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 15 Vanguard Long-Term Bond Index I BC Long Government/Credit 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 Long-Term Bond Index I -0.57 1.04 98.99 1.50 8.69 0.94 5 BC Long Government/Credit 0.00 1.00 100.00 1.57 8.31 0.00 Universe(5%) 11.71 1.38 93.72 2.77 11.98 13.84 0 0 5 10 15 20 25 30 Universe(25%) 5.90 0.68 78.47 2.21 7.72 7.92 Universe(Median) 4.94 0.33 46.93 1.90 5.18 6.87 Total Annualized StdDev, % Universe(75%) 1.36 0.13 25.61 1.59 4.03 5.61 Morningstar Long Term Bond Universe Vanguard Long-Term Bond Index I Universe(95%) -3.21 -0.09 1.20 1.18 1.80 2.03 Cash BC Long Government/Credit City of Dover, Delaware Police Pension Plan 24

Quarterly Investment Monitor Data as of 12/31/2012 PIMCO Long Duration Total Return Instl 8.20 Portfolio Information Investment Strategy Summary % Cash 15.34 Ticker PLRIX % US Stocks The investment seeks maximum total return, consistent with prudent investment Morningstar Category Long-term Bond % Bonds management. The fund invests at least 65% of its total assets in a diversified portfolio of Avg Mkt Cap $MM 56676.85 % Non-US Stocks Fixed Income Instruments of varying maturities, which may be represented by forwards or Cat Med Mkt Cap $MM 45740.49 % Pref derivatives such as options, futures contracts or swap agreements. It invests primarily in Net Assets $MM 6107.08 investment grade debt securities, but may invest up to 10% of its total assets in high yield % Conv Turnover Ratio 219.00 securities ("junk bonds") that are rated B or higher by Moody's, or equivalently rated by S&P % Other % Assets in Top 10 Holdings 24.20 or Fitch, or, if unrated, determined by PIMCO to be of comparable quality. % Non-US Bonds Total Number of Holdings 852.00 Manager Name Stephen Rodosky _________________________________________________________________________ Manager Tenure 5.42 75.43 Fund Incept Date 08/31/2006 Prospectus Exp Ratio 0.50 Phone Number 888-877-4626 Performance vs. Peer Group Portfolio Region Portfolio Structure Closed to New Investors No % United States 100.00 % Cash 8.20 20 % Canada 0.00 % US Stocks 0.00 % Latin America 0.00 % Bonds 75.43 18 % United Kingdom 0.00 % Non-US Stocks 0.00 % Eurozone 0.00 % Pref 0.43 Portfolio Ratings 16 Total Annualized Return, % % Europe - ex Euro 0.00 % Conv 0.00 Mstar Rating % Europe - Emerging 0.00 % Other 0.59 3 Year Mstar Rating 14 % Africa 0.00 % Non-US Bonds 15.34 % Rank Cat 3 Yr 35 % Middle East 0.00 5 Year Mstar Rating 12 % Japan 0.00 % Rank Cat 5 Yr 17 % Australasia 0.00 10 Year Mstar Rating NA 10 % Asia - Developed 0.00 % Rank Cat 10 Yr NA % Asia - Emerging 0.00 8 6 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 4 % Basic Materials 0.00 Avg Eff Duration 13.42 2 400 % Communication Services 0.00 Effective Maturity 21.94 2 % Consumer Cyclical 0.00 Avg Credit Quality NA % Consumer Defensive 0.00 US Govt/ Agency NA 350 0 % Healthcare 0.00 AAA NA % Industrials 0.00 AA NA -2 300 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 0.00 A NA % Technology 0.00 BBB NA % Energy 0.00 BB NA 250 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services 100.00 B NA Median to 75th Percentile 75th to 95th Percentile % Utilities 0.00 Below B NA Ratio PIMCO Long Duration Total Return Instl BC Long Government/Credit NR/NA NA 1 200 Turnover 3 Year to 1 3 5 Top Ten Holdings 150 Performance Months Date Year Years Years US Treasury Bond 4.375% 6.49% PIMCO Long Duration Total Return Instl 0.44 10.28 10.28 13.44 11.62 US Treasury Bond 4.25% 3.52% BC Long Government/Credit 0.45 8.78 8.78 13.65 10.16 100 US Treasury Bond 5.375% 2.39% Universe(5%) 2.64 18.09 18.09 16.94 13.61 US Treasury Bond 3.125% 2.08% Universe(25%) 1.51 12.89 12.89 13.45 10.82 Quebec Prov Cda 5.75% 1.80% 50 Universe(Median) 1.12 10.63 10.63 10.28 8.74 U S Treas Bd Stripped Prin Pmt 1.77% Universe(75%) 0.38 6.87 6.87 9.39 5.96 Resolution Fdg Fed Bk Prin Stp 1.67% Universe(95%) -0.99 2.85 2.85 4.12 3.84 Resolution Fdg Fed Bk Prin Stp 1.63% 0 0 AID 5.5% 1.50% Prospectus Exp Ratio Turnover Ratio FNMA 1.35% City of Dover, Delaware Police Pension Plan 25

Quarterly Investment Monitor Data as of 12/31/2012 PIMCO Long Duration Total Return Instl Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 40 0 30 25 Total Return Rank, % 20 50 Total Return, % 10 75 0 100 Jan-06 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 -10 Up/Down Market Capture Ratio -20 Jan-10 - Dec-12 250 -30 225 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 200 Up Mkt Capture Ratio, % PIMCO Long Duration Total Return Instl BC Long Government/Credit 175 150 Annual Return % 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 125 PIMCO Long Duration Total Return Instl NA NA NA NA 7.83 12.38 5.62 11.64 18.57 10.28 100 BC Long Government/Credit 5.87 8.56 5.33 2.71 6.60 8.44 1.92 10.16 22.49 8.78 75 50 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 25 12 3 12 14 0 -150 -100 -50 0 50 100 150 200 250 300 350 10 12 Down Mkt Capture Ratio, % 10 8 Morningstar Long Term Bond Universe PIMCO Long Duration Total Return Instl Total Annualized StdDev, % Excess Annualized StdDev, % 10 2 8 BC Long Government/Credit 6 Sharpe Ratio 8 Alpha, % 4 6 6 Return vs. Risk 2 1 4 Jan-10 - Dec-12 4 0 25 2 -2 2 20 Total Annualized Return, % -4 0 0 0 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 15 PIMCO Long Duration Total Return Instl BC Long Government/Credit 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 PIMCO Long Duration Total Return Instl 1.16 0.89 92.40 1.66 7.72 2.30 5 BC Long Government/Credit 0.00 1.00 100.00 1.57 8.31 0.00 Universe(5%) 11.71 1.38 93.72 2.77 11.98 13.84 0 0 5 10 15 20 25 30 Universe(25%) 5.90 0.68 78.47 2.21 7.72 7.92 Universe(Median) 4.94 0.33 46.93 1.90 5.18 6.87 Total Annualized StdDev, % Universe(75%) 1.36 0.13 25.61 1.59 4.03 5.61 Morningstar Long Term Bond Universe PIMCO Long Duration Total Return Instl Universe(95%) -3.21 -0.09 1.20 1.18 1.80 2.03 Cash BC Long Government/Credit City of Dover, Delaware Police Pension Plan 26

Quarterly Investment Monitor Data as of 12/31/2012 Target Small Capitalization Value T 4.72 2.35 Portfolio Information Investment Strategy Summary % Cash Ticker TASVX % US Stocks The investment seeks above-average capital appreciation. The fund normally invests at least Morningstar Category Small Value % Bonds 80% of investable assets in common stocks of small companies. Small companies are those Avg Mkt Cap $MM 1851.62 % Non-US Stocks companies with market capitalizations comparable to those in the Russell 2000 Value Index. Cat Med Mkt Cap $MM 1302.61 % Pref It invests in stocks of small companies that the advisor believe are undervalued and have an Net Assets $MM 1219.57 above-average potential to increase in price, given the company's sales, earnings, book % Conv Turnover Ratio 37.00 value, cash flow and recent performance. % Other % Assets in Top 10 Holdings 9.22 % Non-US Bonds Total Number of Holdings 666.00 _________________________________________________________________________ Manager Name Morley D. Campbell Manager Tenure 4.25 92.88 Fund Incept Date 01/05/1993 Prospectus Exp Ratio 0.71 Phone Number 800-225-1852 Performance vs. Peer Group Portfolio Region Portfolio Structure Closed to New Investors No % United States 97.54 % Cash 4.72 25 % Canada 1.14 % US Stocks 92.88 % Latin America 0.43 % Bonds 0.00 % United Kingdom 0.03 % Non-US Stocks 2.35 20 % Eurozone 0.63 % Pref 0.00 Portfolio Ratings Total Annualized Return, % % Europe - ex Euro 0.00 % Conv 0.00 Mstar Rating % Europe - Emerging 0.00 % Other 0.05 3 Year Mstar Rating % Africa 0.00 % Non-US Bonds 0.00 % Rank Cat 3 Yr 39 15 % Middle East 0.24 5 Year Mstar Rating % Japan 0.00 % Rank Cat 5 Yr 30 % Australasia 0.00 10 Year Mstar Rating % Asia - Developed 0.00 % Rank Cat 10 Yr 7 10 % Asia - Emerging 0.00 5 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group % Basic Materials 8.09 Avg Eff Duration NA 2 200 % Communication Services 0.50 Effective Maturity NA 0 % Consumer Cyclical 11.87 Avg Credit Quality NA 180 % Consumer Defensive 4.94 US Govt/ Agency NA % Healthcare 7.75 AAA NA 160 % Industrials 23.29 AA NA -5 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 5.78 A NA 140 % Technology 8.71 BBB NA % Energy 6.39 BB NA 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services 17.88 B NA 120 Median to 75th Percentile 75th to 95th Percentile % Utilities 4.80 Below B NA Ratio Target Small Capitalization Value T S&P 600 Index NR/NA NA 1 100 Turnover 80 3 Year to 1 3 5 Top Ten Holdings Performance Months Date Year Years Years Aaron's, Inc. 1.28% Target Small Capitalization Value T 3.75 14.14 14.14 11.98 5.24 60 Bristow Group, Inc. 1.17% S&P 600 Index 2.22 16.33 16.33 14.07 5.14 Amerigroup Corporation 1.06% Universe(5%) 5.89 23.61 23.61 15.78 7.69 Teleflex Inc. 0.95% 40 Universe(25%) 3.87 17.70 17.70 13.53 4.84 PVH Corp 0.83% Universe(Median) 2.55 15.58 15.58 12.12 3.58 Valmont Industries, Inc. 0.80% 20 Universe(75%) 1.63 13.57 13.57 10.46 2.44 Hexcel Corporation 0.80% Universe(95%) -0.02 7.60 7.60 6.88 -0.37 Silgan Holdings, Inc. 0.79% 0 0 Raymond James Financial Inc 0.79% Prospectus Exp Ratio Turnover Ratio Trustmark Corporation 0.77% City of Dover, Delaware Police Pension Plan 27

Quarterly Investment Monitor Data as of 12/31/2012 Target Small Capitalization Value T Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 80 0 60 25 Total Return Rank, % 40 50 Total Return, % 20 75 0 100 Jan-06 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 -20 Up/Down Market Capture Ratio -40 Jan-10 - Dec-12 250 -60 225 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 200 Up Mkt Capture Ratio, % Target Small Capitalization Value T S&P 600 Index 175 150 Annual Return % 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 125 Target Small Capitalization Value T 47.10 24.02 10.10 17.72 0.52 -27.45 26.69 23.63 -0.48 14.14 100 S&P 600 Index 38.79 22.65 7.68 15.12 -0.30 -31.07 25.57 26.31 1.02 16.33 75 50 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 25 2 0.9 25 10 0 0 25 50 75 100 125 150 175 200 225 1 0.8 9 Down Mkt Capture Ratio, % 20 8 0 0.7 Morningstar SmallCap Blend Universe Target Small Capitalization Value T Total Annualized StdDev, % Excess Annualized StdDev, % 7 S&P 600 Index -1 0.6 15 6 Sharpe Ratio -2 0.5 Alpha, % 5 -3 0.4 10 4 Return vs. Risk -4 0.3 3 Jan-10 - Dec-12 -5 0.2 20 5 2 18 -6 0.1 1 16 Total Annualized Return, % -7 0.0 0 0 14 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 12 Target Small Capitalization Value T S&P 600 Index 10 8 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 6 Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error 4 Target Small Capitalization Value T -0.80 0.91 98.06 0.72 17.68 3.00 2 S&P 600 Index 0.00 1.00 100.00 0.78 19.22 0.00 0 Universe(5%) 1.30 1.19 99.44 0.82 24.10 9.28 -2 0 5 10 15 20 25 30 35 40 45 Universe(25%) -0.54 1.07 98.52 0.73 20.95 5.33 Universe(Median) -2.06 1.02 97.09 0.66 20.11 3.81 Total Annualized StdDev, % Universe(75%) -3.54 0.98 94.49 0.59 18.98 2.60 Morningstar SmallCap Blend Universe Target Small Capitalization Value T Universe(95%) -6.66 0.82 86.17 0.40 16.67 1.92 Cash S&P 600 Index City of Dover, Delaware Police Pension Plan 28

Quarterly Investment Monitor Data as of 12/31/2012 Vanguard Equity-Income Adm 4.73 7.97 Portfolio Information Investment Strategy Summary % Cash Ticker VEIRX % US Stocks The investment seeks an above-average level of current income and reasonable capital Morningstar Category Large Value % Bonds appreciation. The fund primarily invests in common stocks of medium-sized and large Avg Mkt Cap $MM 63785.05 % Non-US Stocks companies whose stocks pay above-average levels of dividend income and are considered to Cat Med Mkt Cap $MM 42144.86 % Pref have the potential for capital appreciation. In addition, the advisors generally look for Net Assets $MM 9690.30 companies that they believe are committed to paying dividends consistently. The fund % Conv Turnover Ratio 26.00 invests at least 80% of its assets in stocks. It uses multiple investment advisors. % Other % Assets in Top 10 Holdings 31.97 % Non-US Bonds Total Number of Holdings 162.00 _________________________________________________________________________ Manager Name W. Michael Reckmeyer III Manager Tenure 5.01 87.30 Fund Incept Date 03/21/1988 Prospectus Exp Ratio 0.22 Phone Number 800-662-7447 Performance vs. Peer Group Portfolio Region Portfolio Structure Closed to New Investors No % United States 91.63 % Cash 4.73 25 % Canada 0.59 % US Stocks 87.30 % Latin America 0.00 % Bonds 0.00 % United Kingdom 3.87 % Non-US Stocks 7.97 20 % Eurozone 1.57 % Pref 0.00 Portfolio Ratings Total Annualized Return, % % Europe - ex Euro 2.35 % Conv 0.00 Mstar Rating % Europe - Emerging 0.00 % Other 0.00 3 Year Mstar Rating % Africa 0.00 % Non-US Bonds 0.00 % Rank Cat 3 Yr 2 15 % Middle East 0.00 5 Year Mstar Rating % Japan 0.00 % Rank Cat 5 Yr 7 % Australasia 0.00 10 Year Mstar Rating % Asia - Developed 0.00 % Rank Cat 10 Yr 8 10 % Asia - Emerging 0.00 5 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group % Basic Materials 2.93 Avg Eff Duration NA 2 180 % Communication Services 4.89 Effective Maturity NA 0 % Consumer Cyclical 7.08 Avg Credit Quality NA 160 % Consumer Defensive 15.73 US Govt/ Agency NA % Healthcare 13.24 AAA NA % Industrials 13.73 AA NA 140 -5 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 0.02 A NA % Technology 8.94 BBB NA 120 % Energy 13.43 BB NA 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services 12.97 B NA Median to 75th Percentile 75th to 95th Percentile % Utilities 7.01 Below B NA Ratio 100 Vanguard Equity-Income Adm S&P 500 Value NR/NA NA 1 Turnover 80 3 Year to 1 3 5 Top Ten Holdings Performance Months Date Year Years Years Exxon Mobil Corporation 4.45% 60 Vanguard Equity-Income Adm 0.14 13.58 13.58 13.07 3.22 Chevron Corp 4.08% S&P 500 Value 1.64 17.68 17.68 10.47 -0.15 Merck & Co Inc 3.45% 40 Universe(5%) 3.64 20.29 20.29 12.72 3.53 Johnson & Johnson 3.24% Universe(25%) 2.07 17.19 17.19 10.42 1.70 Pfizer Inc 3.19% Universe(Median) 1.21 14.86 14.86 9.26 0.58 AT&T Inc 3.16% 20 Universe(75%) 0.19 12.47 12.47 7.90 -0.64 General Electric Co 2.88% Universe(95%) -1.64 8.91 8.91 5.49 -2.44 JPMorgan Chase & Co 2.60% 0 0 Philip Morris International, Inc. 2.53% Prospectus Exp Ratio Turnover Ratio Microsoft Corporation 2.40% City of Dover, Delaware Police Pension Plan 29

Quarterly Investment Monitor Data as of 12/31/2012 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 Jan-06 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 -30 Up/Down Market Capture Ratio -40 Jan-10 - Dec-12 180 -50 160 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 140 Up Mkt Capture Ratio, % Vanguard Equity-Income Adm S&P 500 Value 120 Annual Return % 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 100 Vanguard Equity-Income Adm 25.24 13.69 4.52 20.77 4.99 -30.86 17.26 14.99 10.69 13.58 80 S&P 500 Value 30.36 15.03 8.71 20.80 1.99 -39.22 21.18 15.10 -0.48 17.68 60 40 20 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 5 1.1 20 7 0 0 20 40 60 80 100 120 140 160 180 4 1.0 18 6 Down Mkt Capture Ratio, % 3 0.9 16 Morningstar Large Value Universe Vanguard Equity-Income Adm Total Annualized StdDev, % Excess Annualized StdDev, % 0.8 5 2 14 S&P 500 Value 0.7 1 12 Sharpe Ratio 4 Alpha, % 0.6 0 10 0.5 -1 8 3 Return vs. Risk 0.4 -2 6 Jan-10 - Dec-12 0.3 2 18 -3 0.2 4 1 16 -4 0.1 2 14 Total Annualized Return, % -5 0.0 0 0 12 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 10 Vanguard Equity-Income Adm S&P 500 Value 8 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 Vanguard Equity-Income Adm 4.26 0.79 93.81 1.00 13.05 4.66 2 S&P 500 Value 0.00 1.00 100.00 0.70 15.98 0.00 0 Universe(5%) 3.81 1.20 98.94 0.95 19.48 6.52 -2 0 5 10 15 20 25 30 Universe(25%) 0.39 1.05 98.13 0.71 17.05 4.49 Universe(Median) -0.86 0.98 96.87 0.63 15.92 3.27 Total Annualized StdDev, % Universe(75%) -2.31 0.90 94.28 0.54 14.73 2.42 Morningstar Large Value Universe Vanguard Equity-Income Adm Universe(95%) -4.76 0.72 89.14 0.39 11.99 1.74 Cash S&P 500 Value City of Dover, Delaware Police Pension Plan 30

Quarterly Investment Monitor Data as of 12/31/2012 Vanguard Morgan Growth Adm 1.82 Portfolio Information Investment Strategy Summary 5.36 % Cash Ticker VMRAX % US Stocks The investment seeks long-term growth of capital. The fund invests mainly in the stocks of Morningstar Category Large Growth % Bonds mid- and large-capitalization U.S. companies whose revenues and/or earnings are expected Avg Mkt Cap $MM 33465.64 % Non-US Stocks to grow faster than those of the average company in the market. It uses multiple investment Cat Med Mkt Cap $MM 39385.49 % Pref advisors. Net Assets $MM 8717.05 % Conv Turnover Ratio 49.00 _________________________________________________________________________ % Other % Assets in Top 10 Holdings 23.15 % Non-US Bonds Total Number of Holdings 323.00 Manager Name Ford B. Draper Jr. Manager Tenure 4.10 92.80 Fund Incept Date 12/31/1968 Prospectus Exp Ratio 0.30 Phone Number 800-662-7447 Performance vs. Peer Group Portfolio Region Portfolio Structure Closed to New Investors No % United States 94.53 % Cash 1.82 25 % Canada 1.12 % US Stocks 92.80 % Latin America 0.00 % Bonds 0.00 % United Kingdom 0.67 % Non-US Stocks 5.36 20 % Eurozone 1.02 % Pref 0.00 Portfolio Ratings Total Annualized Return, % % Europe - ex Euro 1.30 % Conv 0.00 Mstar Rating % Europe - Emerging 0.00 % Other 0.02 3 Year Mstar Rating % Africa 0.00 % Non-US Bonds 0.00 % Rank Cat 3 Yr 32 15 % Middle East 0.33 5 Year Mstar Rating % Japan 0.00 % Rank Cat 5 Yr 47 % Australasia 0.19 10 Year Mstar Rating % Asia - Developed 0.28 % Rank Cat 10 Yr 27 10 % Asia - Emerging 0.55 5 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group % Basic Materials 3.39 Avg Eff Duration NA 2 300 % Communication Services 2.67 Effective Maturity NA 0 % Consumer Cyclical 15.28 Avg Credit Quality NA % Consumer Defensive 9.21 US Govt/ Agency NA 250 % Healthcare 13.46 AAA NA % Industrials 11.27 AA NA -5 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 1.08 A NA % Technology 32.76 BBB NA 200 % Energy 6.55 BB NA 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services 4.32 B NA Median to 75th Percentile 75th to 95th Percentile % Utilities 0.00 Below B NA Ratio Vanguard Morgan Growth Adm S&P 500 Growth NR/NA NA 1 150 Turnover 3 Year to 1 3 5 Top Ten Holdings Performance Months Date Year Years Years Apple Inc 6.77% 100 Vanguard Morgan Growth Adm -0.95 15.25 15.25 10.17 1.35 Google, Inc. Class A 2.44% S&P 500 Growth -2.04 14.61 14.61 11.33 3.39 Cisco Systems Inc 2.39% Universe(5%) 2.59 21.38 21.38 13.43 5.35 International Business Machines Corp 2.29% Universe(25%) 0.33 17.59 17.59 10.76 2.68 50 Microsoft Corporation 2.26% Universe(Median) -0.92 15.11 15.11 9.42 1.31 Philip Morris International, Inc. 1.51% Universe(75%) -1.75 12.80 12.80 8.00 -0.36 EMC Corporation 1.47% Universe(95%) -3.32 9.32 9.32 4.96 -3.17 Coca-Cola Co 1.44% 0 0 Amazon.com Inc 1.30% Prospectus Exp Ratio Turnover Ratio Wal-Mart Stores Inc 1.29% City of Dover, Delaware Police Pension Plan 31

Quarterly Investment Monitor Data as of 12/31/2012 Vanguard Morgan Growth Adm Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 60 0 40 25 Total Return Rank, % 50 20 Total Return, % 75 0 100 -20 Jan-06 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 -40 Up/Down Market Capture Ratio Jan-10 - Dec-12 300 -60 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 250 Up Mkt Capture Ratio, % Vanguard Morgan Growth Adm S&P 500 Growth 200 Annual Return % 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 150 Vanguard Morgan Growth Adm 33.91 10.61 9.32 11.32 11.36 -41.33 36.31 18.90 -2.42 15.25 S&P 500 Growth 27.08 6.97 1.14 11.01 9.13 -34.92 31.57 15.05 4.65 14.61 100 50 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 1 0.9 22 9 0 0 25 50 75 100 125 150 175 200 225 250 20 0 0.8 8 Down Mkt Capture Ratio, % 18 -1 0.7 7 Morningstar Large Growth Universe Vanguard Morgan Growth Adm Total Annualized StdDev, % Excess Annualized StdDev, % 16 -2 0.6 6 S&P 500 Growth 14 Sharpe Ratio -3 0.5 5 Alpha, % 12 -4 0.4 10 4 Return vs. Risk 8 -5 0.3 3 Jan-10 - Dec-12 6 -6 0.2 2 25 4 -7 0.1 1 20 2 Total Annualized Return, % -8 0.0 0 0 15 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile Vanguard Morgan Growth Adm S&P 500 Growth 10 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 5 Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error Vanguard Morgan Growth Adm -2.48 1.16 95.71 0.62 17.84 4.40 0 S&P 500 Growth 0.00 1.00 100.00 0.78 15.08 0.00 Universe(5%) 0.90 1.27 97.30 0.81 20.11 8.30 -5 0 5 10 15 20 25 30 35 40 Universe(25%) -1.26 1.16 95.93 0.68 18.13 5.45 Universe(Median) -2.63 1.11 94.54 0.60 17.28 4.46 Total Annualized StdDev, % Universe(75%) -3.91 1.05 92.22 0.53 16.21 3.68 Morningstar Large Growth Universe Vanguard Morgan Growth Adm Universe(95%) -7.02 0.92 85.79 0.36 14.39 2.78 Cash S&P 500 Growth City of Dover, Delaware Police Pension Plan 32

Quarterly Investment Monitor Data as of 12/31/2012 Vanguard PRIMECAP Inv 3.32 Portfolio Information % Cash Investment Strategy Summary 12.37 Ticker VPMCX % US Stocks The investment seeks long-term capital appreciation. The fund invests in stocks considered Morningstar Category Large Growth % Bonds to have above-average earnings growth potential that is not reflected in their current market Avg Mkt Cap $MM 45385.05 % Non-US Stocks prices. Its portfolio consists predominantly of large- and mid-capitalization stocks. Cat Med Mkt Cap $MM 39385.49 % Pref Net Assets $MM 29253.78 _________________________________________________________________________ % Conv Turnover Ratio 6.00 % Other % Assets in Top 10 Holdings 40.50 % Non-US Bonds Total Number of Holdings 122.00 Manager Name Joel P. Fried Manager Tenure 24.02 84.31 Fund Incept Date 11/01/1984 Prospectus Exp Ratio 0.45 Phone Number 800-662-7447 Performance vs. Peer Group Portfolio Region Portfolio Structure Closed to New Investors Yes % United States 87.21 % Cash 3.32 25 % Canada 2.69 % US Stocks 84.31 % Latin America 0.38 % Bonds 0.00 % United Kingdom 0.91 % Non-US Stocks 12.37 20 % Eurozone 0.81 % Pref 0.00 Portfolio Ratings Total Annualized Return, % % Europe - ex Euro 7.61 % Conv 0.00 Mstar Rating % Europe - Emerging 0.00 % Other 0.00 3 Year Mstar Rating % Africa 0.00 % Non-US Bonds 0.00 % Rank Cat 3 Yr 65 15 % Middle East 0.00 5 Year Mstar Rating % Japan 0.40 % Rank Cat 5 Yr 16 % Australasia 0.00 10 Year Mstar Rating % Asia - Developed 0.00 % Rank Cat 10 Yr 8 10 % Asia - Emerging 0.00 5 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group % Basic Materials 3.74 Avg Eff Duration NA 2 300 % Communication Services 2.62 Effective Maturity NA 0 % Consumer Cyclical 5.32 Avg Credit Quality NA % Consumer Defensive 1.20 US Govt/ Agency NA 250 % Healthcare 31.83 AAA NA % Industrials 13.38 AA NA -5 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 0.03 A NA % Technology 30.94 BBB NA 200 % Energy 4.91 BB NA 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services 5.83 B NA Median to 75th Percentile 75th to 95th Percentile % Utilities 0.21 Below B NA Ratio Vanguard PRIMECAP Inv S&P 500 Growth NR/NA NA 1 150 Turnover 3 Year to 1 3 5 Top Ten Holdings Performance Months Date Year Years Years Amgen Inc 6.27% 100 Vanguard PRIMECAP Inv 2.56 15.27 15.27 8.50 3.03 Biogen Idec Inc 6.03% S&P 500 Growth -2.04 14.61 14.61 11.33 3.39 Google, Inc. Class A 4.46% Universe(5%) 2.59 21.38 21.38 13.43 5.35 Eli Lilly and Company 3.94% Universe(25%) 0.33 17.59 17.59 10.76 2.68 50 Roche Holding AG 3.71% Universe(Median) -0.92 15.11 15.11 9.42 1.31 FedEx Corporation 3.53% Universe(75%) -1.75 12.80 12.80 8.00 -0.36 Microsoft Corporation 3.47% Universe(95%) -3.32 9.32 9.32 4.96 -3.17 Texas Instruments, Inc. 3.10% 0 0 Novartis AG ADR 3.06% Prospectus Exp Ratio Turnover Ratio Medtronic, Inc. 2.92% City of Dover, Delaware Police Pension Plan 33

Quarterly Investment Monitor Data as of 12/31/2012 Vanguard PRIMECAP Inv Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 60 0 40 25 Total Return Rank, % 50 20 Total Return, % 75 0 100 -20 Jan-06 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 -40 Up/Down Market Capture Ratio Jan-10 - Dec-12 300 -60 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 250 Up Mkt Capture Ratio, % Vanguard PRIMECAP Inv S&P 500 Growth 200 Annual Return % 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 150 Vanguard PRIMECAP Inv 37.75 18.31 8.49 12.30 11.49 -32.41 34.45 12.89 -1.84 15.27 S&P 500 Growth 27.08 6.97 1.14 11.01 9.13 -34.92 31.57 15.05 4.65 14.61 100 50 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 1 0.9 22 9 0 0 25 50 75 100 125 150 175 200 225 250 20 0 0.8 8 Down Mkt Capture Ratio, % 18 -1 0.7 7 Morningstar Large Growth Universe Vanguard PRIMECAP Inv Total Annualized StdDev, % Excess Annualized StdDev, % 16 -2 0.6 6 S&P 500 Growth 14 Sharpe Ratio -3 0.5 5 Alpha, % 12 -4 0.4 10 4 Return vs. Risk 8 -5 0.3 3 Jan-10 - Dec-12 6 -6 0.2 2 25 4 -7 0.1 1 20 2 Total Annualized Return, % -8 0.0 0 0 15 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile Vanguard PRIMECAP Inv S&P 500 Growth 10 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 5 Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error Vanguard PRIMECAP Inv -2.90 1.04 95.25 0.58 16.03 3.54 0 S&P 500 Growth 0.00 1.00 100.00 0.78 15.08 0.00 Universe(5%) 0.90 1.27 97.30 0.81 20.11 8.30 -5 0 5 10 15 20 25 30 35 40 Universe(25%) -1.26 1.16 95.93 0.68 18.13 5.45 Universe(Median) -2.63 1.11 94.54 0.60 17.28 4.46 Total Annualized StdDev, % Universe(75%) -3.91 1.05 92.22 0.53 16.21 3.68 Morningstar Large Growth Universe Vanguard PRIMECAP Inv Universe(95%) -7.02 0.92 85.79 0.36 14.39 2.78 Cash S&P 500 Growth City of Dover, Delaware Police Pension Plan 34

Quarterly Investment Monitor Data as of 12/31/2012 Vanguard Mid-Cap Value Index Admiral 1.33 Portfolio Information Investment Strategy Summary % Cash Ticker VMVAX % US Stocks The investment seeks to track the performance of a benchmark index that measures the Morningstar Category Mid-Cap Value % Bonds investment return of mid-capitalization value stocks. The fund employs an indexing Avg Mkt Cap $MM 5973.09 % Non-US Stocks investment approach designed to track the performance of the MSCI US Mid Cap Value Cat Med Mkt Cap $MM 6963.92 % Pref Index, a broadly diversified index of value stocks of mid-size U.S. companies. It attempts to Net Assets $MM 2358.19 replicate the target index by investing all, or substantially all, of its assets in the stocks that % Conv Turnover Ratio 41.00 make up the index, holding each stock in approximately the same proportion as its % Other % Assets in Top 10 Holdings 9.51 weighting in the index. % Non-US Bonds Total Number of Holdings 266.00 Manager Name Donald M. Butler _________________________________________________________________________ Manager Tenure 6.38 98.67 Fund Incept Date 08/17/2006 Prospectus Exp Ratio 0.10 Phone Number 800-662-7447 Performance vs. Peer Group Portfolio Region Portfolio Structure Closed to New Investors No % United States 98.67 % Cash 0.00 30 % Canada 0.00 % US Stocks 98.67 % Latin America 0.00 % Bonds 0.00 % United Kingdom 0.50 % Non-US Stocks 1.33 25 % Eurozone 0.00 % Pref 0.00 Portfolio Ratings Total Annualized Return, % % Europe - ex Euro 0.62 % Conv 0.00 Mstar Rating % Europe - Emerging 0.00 % Other 0.00 3 Year Mstar Rating 20 % Africa 0.00 % Non-US Bonds 0.00 % Rank Cat 3 Yr 28 % Middle East 0.00 5 Year Mstar Rating % Japan 0.00 % Rank Cat 5 Yr 26 15 % Australasia 0.00 10 Year Mstar Rating NA % Asia - Developed 0.21 % Rank Cat 10 Yr NA % Asia - Emerging 0.00 10 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 5 % Basic Materials 6.21 Avg Eff Duration NA 2 300 % Communication Services 1.59 Effective Maturity NA % Consumer Cyclical 12.21 Avg Credit Quality NA 0 % Consumer Defensive 7.21 US Govt/ Agency NA 250 % Healthcare 5.00 AAA NA % Industrials 12.85 AA NA -5 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 11.32 A NA % Technology 11.63 BBB NA 200 % Energy 5.04 BB NA 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services 17.45 B NA Median to 75th Percentile 75th to 95th Percentile % Utilities 9.49 Below B NA Ratio Vanguard Mid-Cap Value Index Admiral MSCI US Mid Cap 450 Index USD NR/NA NA 1 150 Turnover 3 Year to 1 3 5 Top Ten Holdings Performance Months Date Year Years Years Health Care REIT, Inc. 1.20% 100 Vanguard Mid-Cap Value Index Admiral 3.56 16.02 16.02 12.10 4.23 AvalonBay Communities Inc 1.06% MSCI US Mid Cap 450 Index USD 2.84 16.04 16.04 12.68 3.19 Mattel, Inc. 0.99% Universe(5%) 5.62 26.78 26.78 14.93 6.34 Cooper Industries PLC. 0.97% Universe(25%) 3.82 18.26 18.26 12.95 4.68 50 Seagate Technology PLC 0.97% Universe(Median) 3.13 16.89 16.89 11.68 3.14 American Capital Agency Corp. 0.95% Universe(75%) 2.26 12.83 12.83 9.82 1.43 Watson Pharmaceuticals Inc. 0.89% Universe(95%) -0.25 6.94 6.94 5.14 -2.45 Regions Financial Corporation 0.83% 0 0 DTE Energy Holding Company 0.83% Prospectus Exp Ratio Turnover Ratio Quest Diagnostics Inc 0.82% City of Dover, Delaware Police Pension Plan 35

Quarterly Investment Monitor Data as of 12/31/2012 Vanguard Mid-Cap Value Index Admiral Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 80 0 60 25 Total Return Rank, % 40 50 Total Return, % 20 75 0 100 Jan-06 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 -20 Up/Down Market Capture Ratio -40 Jan-10 - Dec-12 250 -60 225 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 200 Up Mkt Capture Ratio, % Vanguard Mid-Cap Value Index Admiral MSCI US Mid Cap 450 Index USD 175 150 Annual Return % 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 125 Vanguard Mid-Cap Value Index Admiral NA NA NA NA -4.30 -36.56 37.70 21.78 -0.32 16.02 100 MSCI US Mid Cap 450 Index USD 39.05 20.52 13.94 13.75 6.19 -41.80 40.49 25.69 -1.91 16.04 75 50 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 25 3 1.0 25 11 0 0 20 40 60 80 100 120 140 160 180 200 0.9 10 2 Down Mkt Capture Ratio, % 0.8 20 9 1 Morningstar Midcap Blend Universe Vanguard Mid-Cap Value Index Admiral Total Annualized StdDev, % Excess Annualized StdDev, % 8 0.7 MSCI US Mid Cap 450 Index USD 0 7 0.6 15 Sharpe Ratio -1 Alpha, % 6 0.5 -2 5 0.4 10 Return vs. Risk 4 -3 0.3 Jan-10 - Dec-12 3 -4 25 0.2 5 2 -5 0.1 20 1 Total Annualized Return, % -6 0.0 0 0 15 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile Vanguard Mid-Cap Value Index Admiral MSCI US Mid Cap 450 Index USD 10 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 5 Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error Vanguard Mid-Cap Value Index Admiral 0.19 0.93 98.05 0.76 16.72 2.60 0 MSCI US Mid Cap 450 Index USD 0.00 1.00 100.00 0.76 17.71 0.00 Universe(5%) 2.99 1.24 99.31 0.93 22.68 10.03 -5 0 5 10 15 20 25 30 35 40 Universe(25%) 0.16 1.06 98.55 0.76 19.15 5.89 Universe(Median) -0.83 1.02 96.34 0.70 18.14 3.93 Total Annualized StdDev, % Universe(75%) -2.54 0.92 93.37 0.59 17.03 2.41 Morningstar Midcap Blend Universe Vanguard Mid-Cap Value Index Admiral Universe(95%) -5.97 0.71 83.70 0.40 13.53 1.56 Cash MSCI US Mid Cap 450 Index USD City of Dover, Delaware Police Pension Plan 36

Quarterly Investment Monitor Data as of 12/31/2012 American Funds New Perspective R6 7.74 1.55 Portfolio Information Investment Strategy Summary % Cash Ticker RNPGX % US Stocks The investment seeks long-term growth of capital; future income is a secondary objective. Morningstar Category World Stock 38.69 % Bonds The fund seeks to take advantage of investment opportunities generated by changes in Avg Mkt Cap $MM 43325.20 % Non-US Stocks international trade patterns and economic and political relationships by investing in common Cat Med Mkt Cap $MM 25224.82 % Pref stocks of companies located around the world. In pursuing its primary investment objective, Net Assets $MM 43579.90 it invests primarily in common stocks that the investment adviser believes have the % Conv Turnover Ratio 16.00 potential for growth. In pursuing its secondary objective, the fund invests in common stocks % Other % Assets in Top 10 Holdings 18.47 of companies with the potential to pay dividends in the future. % Non-US Bonds Total Number of Holdings 290.00 Manager Name Brady L. Enright _________________________________________________________________________ 51.86 Manager Tenure 7.09 Fund Incept Date 03/13/1973 Prospectus Exp Ratio 0.46 Phone Number 800-421-4225 Performance vs. Peer Group Portfolio Region Portfolio Structure Closed to New Investors No % United States 42.73 % Cash 7.74 25 % Canada 3.13 % US Stocks 38.69 % Latin America 2.81 % Bonds 0.16 % United Kingdom 7.98 % Non-US Stocks 51.86 20 % Eurozone 15.59 % Pref 0.00 Portfolio Ratings Total Annualized Return, % % Europe - ex Euro 12.28 % Conv 0.00 Mstar Rating % Europe - Emerging 0.00 % Other 1.55 3 Year Mstar Rating 15 % Africa 3.11 % Non-US Bonds 0.00 % Rank Cat 3 Yr 28 % Middle East 0.00 5 Year Mstar Rating % Japan 4.30 % Rank Cat 5 Yr 16 10 % Australasia 2.13 10 Year Mstar Rating % Asia - Developed 4.65 % Rank Cat 10 Yr 23 % Asia - Emerging 1.29 5 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 0 % Basic Materials 6.88 Avg Eff Duration NA 3 180 % Communication Services 2.69 Effective Maturity NA % Consumer Cyclical 15.70 Avg Credit Quality NA -5 160 % Consumer Defensive 13.00 US Govt/ Agency NA % Healthcare 17.40 AAA NA % Industrials 12.29 AA NA 140 -10 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 0.24 A NA % Technology 14.55 BBB NA 2 120 % Energy 5.93 BB NA 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services 10.36 B NA Median to 75th Percentile 75th to 95th Percentile % Utilities 0.95 Below B NA Ratio 100 American Funds New Perspective R6 MSCI AC World Index ND USD NR/NA NA Turnover 80 3 Year to 1 3 5 Top Ten Holdings Performance Months Date Year Years Years Novo Nordisk A/S 4.99% 1 60 American Funds New Perspective R6 4.21 21.19 21.19 8.30 1.69 Amazon.com Inc 2.25% MSCI AC World Index ND USD 2.88 16.13 16.13 6.63 -1.16 Google, Inc. Class A 1.78% 40 Universe(5%) 7.43 22.97 22.97 11.43 3.80 Home Depot, Inc. 1.65% Universe(25%) 5.01 19.76 19.76 8.75 1.14 Newmont Mining Corporation 1.41% Universe(Median) 3.71 15.94 15.94 6.93 -0.51 British American Tobacco PLC 1.39% 20 Universe(75%) 2.11 12.97 12.97 4.88 -2.43 Naspers Ltd 1.36% Universe(95%) -0.78 4.91 4.91 0.43 -5.37 Nestle SA 1.27% 0 0 America Movil, S.A.B. de C.V. ADR 1.21% Prospectus Exp Ratio Turnover Ratio ACE Ltd 1.16% City of Dover, Delaware Police Pension Plan 37

Quarterly Investment Monitor Data as of 12/31/2012 American Funds New Perspective R6 Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 60 0 40 25 Total Return Rank, % 50 20 Total Return, % 75 0 100 -20 Jan-06 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 -40 Up/Down Market Capture Ratio Jan-10 - Dec-12 140 -60 120 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 100 Up Mkt Capture Ratio, % American Funds New Perspective R6 MSCI AC World Index ND USD 80 60 Annual Return % 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 40 American Funds New Perspective R6 36.76 14.27 11.28 19.87 16.03 -37.83 37.73 13.11 -7.33 21.19 20 MSCI AC World Index ND USD 33.99 15.23 10.84 20.95 11.66 -42.20 34.63 12.67 -7.35 16.13 0 -20 -40 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error -60 6 0.9 25 12 -80 0 20 40 60 80 100 120 140 160 0.8 Down Mkt Capture Ratio, % 4 10 20 0.7 Morningstar World Stock Universe American Funds New Perspective R6 Total Annualized StdDev, % Excess Annualized StdDev, % 2 0.6 8 MSCI AC World Index ND USD 15 Sharpe Ratio 0 0.5 Alpha, % 6 0.4 -2 10 Return vs. Risk 0.3 4 Jan-10 - Dec-12 -4 0.2 20 5 2 15 -6 0.1 Total Annualized Return, % 10 -8 0.0 0 0 5 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 0 American Funds New Perspective R6 MSCI AC World Index ND USD -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 1.87 0.94 98.01 0.56 16.57 2.53 MSCI AC World Index ND USD 0.00 1.00 100.00 0.45 17.37 0.00 -20 Universe(5%) 5.88 1.17 98.07 0.85 21.28 11.19 -25 0 5 10 15 20 25 30 35 Universe(25%) 2.21 1.07 96.74 0.57 19.41 7.10 Universe(Median) 0.46 1.02 94.53 0.46 18.16 4.99 Total Annualized StdDev, % Universe(75%) -1.82 0.85 87.32 0.34 16.57 3.73 Morningstar World Stock Universe American Funds New Perspective R6 Universe(95%) -6.09 0.63 68.44 0.12 12.31 2.49 Cash MSCI AC World Index ND USD City of Dover, Delaware Police Pension Plan 38

Quarterly Investment Monitor Data as of 12/31/2012 Harding Loevner Global Equity Inst 4.93 Portfolio Information Investment Strategy Summary % Cash Ticker HLMVX % US Stocks The investment seeks long-term capital appreciation. The fund invests in companies based 53.22 Morningstar Category World Stock % Bonds in the U.S. and other developed markets, as well as in emerging and frontier markets. It Avg Mkt Cap $MM 30676.88 % Non-US Stocks invests at least 80% of net assets in common stocks, preferred stock, rights and warrants Cat Med Mkt Cap $MM 25224.82 % Pref issued by companies that are based both inside and outside the United States, securities Net Assets $MM 429.03 convertible into such securities and investment companies that invest in the types of % Conv Turnover Ratio 40.00 securities in which the fund would normally invest. The fund normally holds 35-75 % Other % Assets in Top 10 Holdings 30.14 investments across at least 15 countries. % Non-US Bonds Total Number of Holdings 67.00 41.85 Manager Name Peter J. Baughan _________________________________________________________________________ Manager Tenure 9.85 Fund Incept Date 11/29/1996 Prospectus Exp Ratio 0.95 Phone Number 877-435-8105 Performance vs. Peer Group Portfolio Region Portfolio Structure Closed to New Investors No % United States 55.97 % Cash 0.00 25 % Canada 1.25 % US Stocks 53.22 % Latin America 1.81 % Bonds 0.00 % United Kingdom 5.53 % Non-US Stocks 41.85 20 % Eurozone 7.81 % Pref 0.00 Portfolio Ratings Total Annualized Return, % % Europe - ex Euro 7.92 % Conv 0.00 Mstar Rating % Europe - Emerging 2.26 % Other 4.93 3 Year Mstar Rating 15 % Africa 1.39 % Non-US Bonds 0.00 % Rank Cat 3 Yr 37 % Middle East 0.00 5 Year Mstar Rating % Japan 9.64 % Rank Cat 5 Yr 18 10 % Australasia 1.37 10 Year Mstar Rating % Asia - Developed 0.00 % Rank Cat 10 Yr 39 % Asia - Emerging 5.05 5 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 0 % Basic Materials 3.76 Avg Eff Duration NA 3 180 % Communication Services 1.51 Effective Maturity NA % Consumer Cyclical 18.13 Avg Credit Quality NA -5 160 % Consumer Defensive 12.33 US Govt/ Agency NA % Healthcare 8.48 AAA NA % Industrials 11.63 AA NA 140 -10 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 0.00 A NA % Technology 21.73 BBB NA 2 120 % Energy 6.46 BB NA 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services 15.96 B NA Median to 75th Percentile 75th to 95th Percentile % Utilities 0.00 Below B NA Ratio 100 Harding Loevner Global Equity Inst MSCI AC World Index ND USD NR/NA NA Turnover 80 3 Year to 1 3 5 Top Ten Holdings Performance Months Date Year Years Years Northern Instl Fds 4.93% 1 60 Harding Loevner Global Equity Inst 1.07 17.42 17.42 7.58 1.49 Wells Fargo & Co 3.59% MSCI AC World Index ND USD 2.88 16.13 16.13 6.63 -1.16 eBay Inc 3.52% 40 Universe(5%) 7.43 22.97 22.97 11.43 3.80 Unicharm Corp 3.12% Universe(25%) 5.01 19.76 19.76 8.75 1.14 Microsoft Corporation 2.83% Universe(Median) 3.71 15.94 15.94 6.93 -0.51 Nestle SA ADR 2.81% 20 Universe(75%) 2.11 12.97 12.97 4.88 -2.43 Schlumberger NV 2.55% Universe(95%) -0.78 4.91 4.91 0.43 -5.37 Fanuc Corp 2.39% 0 0 Apple Inc 2.22% Prospectus Exp Ratio Turnover Ratio Emerson Electric Co. 2.17% City of Dover, Delaware Police Pension Plan 39

Quarterly Investment Monitor Data as of 12/31/2012 Harding Loevner Global Equity Inst Annual Performance vs. Peer Group 3 Year Rolling Return Rank within Category 60 0 40 25 Total Return Rank, % 50 20 Total Return, % 75 0 100 -20 Jan-06 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 -40 Up/Down Market Capture Ratio Jan-10 - Dec-12 140 -60 120 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 100 Up Mkt Capture Ratio, % Harding Loevner Global Equity Inst MSCI AC World Index ND USD 80 60 Annual Return % 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 40 Harding Loevner Global Equity Inst 31.51 7.61 16.65 17.84 16.39 -38.29 40.16 15.55 -8.22 17.42 20 MSCI AC World Index ND USD 33.99 15.23 10.84 20.95 11.66 -42.20 34.63 12.67 -7.35 16.13 0 -20 -40 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error -60 6 0.9 25 12 -80 0 20 40 60 80 100 120 140 160 0.8 Down Mkt Capture Ratio, % 4 10 20 0.7 Morningstar World Stock Universe Harding Loevner Global Equity Inst Total Annualized StdDev, % Excess Annualized StdDev, % 2 0.6 8 MSCI AC World Index ND USD 15 Sharpe Ratio 0 0.5 Alpha, % 6 0.4 -2 10 Return vs. Risk 0.3 4 Jan-10 - Dec-12 -4 0.2 20 5 2 15 -6 0.1 Total Annualized Return, % 10 -8 0.0 0 0 5 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 0 Harding Loevner Global Equity Inst MSCI AC World Index ND USD -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 Harding Loevner Global Equity Inst 1.27 0.94 95.33 0.51 16.66 3.77 MSCI AC World Index ND USD 0.00 1.00 100.00 0.45 17.37 0.00 -20 Universe(5%) 5.88 1.17 98.07 0.85 21.28 11.19 -25 0 5 10 15 20 25 30 35 Universe(25%) 2.21 1.07 96.74 0.57 19.41 7.10 Universe(Median) 0.46 1.02 94.53 0.46 18.16 4.99 Total Annualized StdDev, % Universe(75%) -1.82 0.85 87.32 0.34 16.57 3.73 Morningstar World Stock Universe Harding Loevner Global Equity Inst Universe(95%) -6.09 0.63 68.44 0.12 12.31 2.49 Cash MSCI AC World Index ND USD City of Dover, Delaware Police Pension Plan 40

Quarterly Investment Monitor Data as of 12/31/2012 Vanguard Emerging Mkts Stock Idx I 1.27 Portfolio Information Investment Strategy Summary % Cash Ticker VEMIX % US Stocks The investment seeks to track the performance of a benchmark index that measures the Morningstar Category Diversified Emerging Mkts % Bonds investment return of stocks issued by companies located in emerging market countries. The Avg Mkt Cap $MM 19047.00 % Non-US Stocks fund employs an indexing investment approach by investing substantially all (normally Cat Med Mkt Cap $MM 15161.94 % Pref about 95%) of its assets in the common stocks included in the MSCI Emerging Markets Net Assets $MM 75732.08 Index, while employing a form of sampling to reduce risk. The MSCI Emerging Markets Index % Conv Turnover Ratio 8.00 includes approximately 820 common stocks of companies located in emerging markets % Other % Assets in Top 10 Holdings 14.05 around the world. % Non-US Bonds Total Number of Holdings 888.00 Manager Name Michael Perre _________________________________________________________________________ Manager Tenure 4.34 97.95 Fund Incept Date 05/04/1994 Prospectus Exp Ratio 0.13 Phone Number 800-662-7447 Performance vs. Peer Group Portfolio Region Portfolio Structure Closed to New Investors No % United States 0.36 % Cash 0.23 30 % Canada 0.00 % US Stocks 0.35 % Latin America 20.72 % Bonds 0.00 % United Kingdom 0.00 % Non-US Stocks 97.95 25 % Eurozone 0.00 % Pref 1.27 Portfolio Ratings Total Annualized Return, % % Europe - ex Euro 0.00 % Conv 0.00 Mstar Rating 20 % Europe - Emerging 9.82 % Other 0.20 3 Year Mstar Rating % Africa 8.18 % Non-US Bonds 0.00 % Rank Cat 3 Yr 54 % Middle East 0.00 5 Year Mstar Rating 15 % Japan 0.00 % Rank Cat 5 Yr 32 % Australasia 0.00 10 Year Mstar Rating % Asia - Developed 25.96 % Rank Cat 10 Yr 32 10 % Asia - Emerging 34.97 5 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group 0 % Basic Materials 12.06 Avg Eff Duration NA 3 200 % Communication Services 8.67 Effective Maturity NA % Consumer Cyclical 8.70 Avg Credit Quality NA 180 -5 % Consumer Defensive 8.20 US Govt/ Agency NA % Healthcare 1.11 AAA NA 160 % Industrials 7.58 AA NA -10 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 1.65 A NA 140 % Technology 14.49 BBB NA 2 % Energy 11.59 BB NA 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services 22.84 B NA 120 Median to 75th Percentile 75th to 95th Percentile % Utilities 3.11 Below B NA Ratio Vanguard Emerging Mkts Stock Idx I MSCI EM NR USD NR/NA NA 100 Turnover 80 3 Year to 1 3 5 Top Ten Holdings Performance Months Date Year Years Years Samsung Electronics Co Ltd GDR 2.51% 1 60 Vanguard Emerging Mkts Stock Idx I 6.84 18.90 18.90 4.83 -0.81 China Mobile Ltd. 1.86% MSCI EM NR USD 5.58 18.22 18.22 4.66 -0.92 America Movil, S.A.B. de C.V. 1.39% Universe(5%) 9.11 25.41 25.41 7.94 2.63 China Construction Bank Corp H Shares 1.38% 40 Universe(25%) 7.22 20.75 20.75 6.34 -0.43 Taiwan Semiconductor Manufacturing ADR 1.38% Universe(Median) 6.34 19.28 19.28 4.92 -2.16 Gazprom OAO ADR 1.30% 20 Universe(75%) 5.55 16.34 16.34 2.27 -3.43 Samsung Electronics Co Ltd 1.20% Universe(95%) 3.94 11.34 11.34 -2.05 -8.46 Industrial And Commercial Bank Of China Ltd. 1.06% 0 0 CNOOC, Ltd. 1.01% Prospectus Exp Ratio Turnover Ratio Hyundai Motor Co Ltd 0.97% City of Dover, Delaware Police Pension Plan 41

Quarterly Investment Monitor Data as of 12/31/2012 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 Jan-06 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 -40 Up/Down Market Capture Ratio -60 Jan-10 - Dec-12 250 -80 225 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 200 Up Mkt Capture Ratio, % Vanguard Emerging Mkts Stock Idx I MSCI EM NR USD 175 150 Annual Return % 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 125 Vanguard Emerging Mkts Stock Idx I 57.97 26.24 32.35 29.57 39.15 -52.74 76.35 19.06 -18.63 18.90 100 MSCI EM NR USD 55.82 25.55 34.00 32.14 39.42 -53.33 78.51 18.88 -18.42 18.22 75 50 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 25 4 0.5 25 10 0 0 25 50 75 100 125 150 175 200 225 3 9 Down Mkt Capture Ratio, % 2 0.4 20 8 Morningstar Emerging Markets Universe Vanguard Emerging Mkts Stock Idx I Total Annualized StdDev, % Excess Annualized StdDev, % 1 7 MSCI EM NR USD 0 0.3 15 6 Sharpe Ratio Alpha, % -1 5 -2 0.2 10 4 Return vs. Risk -3 3 Jan-10 - Dec-12 -4 15 -5 0.1 5 2 -6 1 10 Total Annualized Return, % -7 0.0 0 0 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 5 Vanguard Emerging Mkts Stock Idx I MSCI EM NR USD 0 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 Emerging Mkts Stock Idx I 0.19 1.01 98.13 0.32 22.26 3.06 -5 MSCI EM NR USD 0.00 1.00 100.00 0.31 21.80 0.00 Universe(5%) 3.54 1.12 98.12 0.48 24.78 9.29 -10 0 5 10 15 20 25 30 35 40 45 50 Universe(25%) 1.74 1.02 97.11 0.39 22.76 5.24 Universe(Median) 0.31 1.00 96.09 0.32 22.12 4.58 Total Annualized StdDev, % Universe(75%) -2.19 0.94 95.01 0.21 21.25 3.92 Morningstar Emerging Markets Universe Vanguard Emerging Mkts Stock Idx I Universe(95%) -6.32 0.86 91.13 0.05 19.11 3.05 Cash MSCI EM NR USD City of Dover, Delaware Police Pension Plan 42

Quarterly Investment Monitor Data as of 12/31/2012 Vanguard REIT Index I Portfolio Information Investment Strategy Summary % Cash Ticker VGSNX % US Stocks The investment seeks to provide a high level of income and moderate long-term capital Morningstar Category Real Estate % Bonds appreciation by tracking the performance of a benchmark index that measures the Avg Mkt Cap $MM 8100.38 % Non-US Stocks performance of publicly traded equity REITs. The fund employs an indexing investment Cat Med Mkt Cap $MM 8062.88 % Pref approach designed to track the performance of the MSCI US REIT Index. The index is Net Assets $MM 29708.87 composed of stocks of publicly traded equity real estate investment trusts (known as REITs). % Conv Turnover Ratio 10.00 It attempts to replicate the index by investing all, or substantially all, of its assets in the % Other % Assets in Top 10 Holdings 45.59 stocks that make up the index, holding each stock in approximately the same proportion as % Non-US Bonds Total Number of Holdings 113.00 its weighting in the index. Manager Name Gerard C. O'Reilly Manager Tenure 16.65 _________________________________________________________________________ 99.45 Fund Incept Date 05/13/1996 Prospectus Exp Ratio 0.08 Phone Number 800-662-7447 Performance vs. Peer Group Portfolio Region Portfolio Structure Closed to New Investors No % United States 100.00 % Cash 0.55 30 % Canada 0.00 % US Stocks 99.45 % 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 Total Annualized Return, % % Europe - ex Euro 0.00 % Conv 0.00 Mstar Rating % Europe - Emerging 0.00 % Other 0.00 3 Year Mstar Rating % Africa 0.00 % Non-US Bonds 0.00 % Rank Cat 3 Yr 21 20 % Middle East 0.00 5 Year Mstar Rating % Japan 0.00 % Rank Cat 5 Yr 22 % Australasia 0.00 10 Year Mstar Rating % Asia - Developed 0.00 % Rank Cat 10 Yr 34 15 % Asia - Emerging 0.00 10 Sector Allocation Credit Quality Expense Ratio vs. Peer Group Turnover Ratio vs. Peer Group % Basic Materials 0.00 Avg Eff Duration NA 2 160 % Communication Services 0.00 Effective Maturity NA 5 % Consumer Cyclical 0.00 Avg Credit Quality NA % Consumer Defensive 0.00 US Govt/ Agency NA 140 % Healthcare 0.00 AAA NA % Industrials 0.00 AA NA 0 120 3 Months YTD 1 Year 3 Years 5 Years % Real Estate 100.00 A NA % Technology 0.00 BBB NA % Energy 0.00 BB NA 100 5th to 25th Percentile 25th to Median Prospectus Exp Ratio % Financial Services 0.00 B NA Median to 75th Percentile 75th to 95th Percentile % Utilities 0.00 Below B NA Ratio Vanguard REIT Index I MSCI US REIT NR USD NR/NA NA 1 80 Turnover 3 Year to 1 3 5 Top Ten Holdings 60 Performance Months Date Year Years Years Simon Property Group Inc 10.78% Vanguard REIT Index I 2.50 17.65 17.65 18.03 6.11 Public Storage 4.75% MSCI US REIT NR USD 2.17 16.47 16.47 16.70 4.11 40 HCP Inc 4.37% Universe(5%) 4.16 28.13 28.13 19.18 8.30 Ventas Inc 4.29% Universe(25%) 2.71 18.17 18.17 18.14 6.07 Equity Residential 4.05% 20 Universe(Median) 2.31 17.01 17.01 17.39 5.23 Boston Properties Inc 3.88% Universe(75%) 1.99 15.89 15.89 15.79 3.62 Prologis Inc 3.78% Universe(95%) 1.21 15.05 15.05 13.13 0.05 Health Care REIT, Inc. 3.45% 0 0 Vornado Realty Trust 3.17% Prospectus Exp Ratio Turnover Ratio AvalonBay Communities Inc 3.04% City of Dover, Delaware Police Pension Plan 43

Quarterly Investment Monitor Data as of 12/31/2012 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 Jan-06 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 -30 Up/Down Market Capture Ratio -40 Jan-10 - Dec-12 160 -50 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 140 Up Mkt Capture Ratio, % 120 Vanguard REIT Index I MSCI US REIT NR USD 100 Annual Return % 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 80 Vanguard REIT Index I 35.65 30.93 12.05 35.15 -16.38 -36.95 29.76 28.56 8.70 17.65 MSCI US REIT NR USD NA NA NA 34.18 -17.84 -39.05 26.27 26.97 7.48 16.47 60 40 20 3 Yr Alpha 3 Yr Sharpe Ratio 3 Yr St Dev 3 Yr Tracking Error 5 2 22 11 0 -20 0 20 40 60 80 100 120 140 160 20 10 4 Down Mkt Capture Ratio, % 18 9 3 Morningstar Real Estate Universe Vanguard REIT Index I Total Annualized StdDev, % Excess Annualized StdDev, % 16 8 MSCI US REIT NR USD 2 14 7 Sharpe Ratio Alpha, % 12 6 1 1 10 5 Return vs. Risk 0 8 4 Jan-10 - Dec-12 6 3 -1 35 4 2 -2 30 2 1 Total Annualized Return, % -3 0 0 0 25 5th to 25th Percentile 25th to Median Median to 75th Percentile 75th to 95th Percentile 20 Vanguard REIT Index I MSCI US REIT NR USD 15 MPT 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr 3 Yr Statistics Alpha Beta R-Squared Sharpe Ratio St Dev Tracking Error 10 Vanguard REIT Index I 1.15 1.00 99.99 0.99 18.29 0.20 5 MSCI US REIT NR USD 0.00 1.00 100.00 0.93 18.30 0.00 Universe(5%) 4.44 1.07 99.72 1.33 20.70 10.21 0 0 5 10 15 20 25 30 Universe(25%) 1.29 1.01 99.51 1.00 18.65 2.67 Universe(Median) 0.51 1.00 99.30 0.96 18.38 1.61 Total Annualized StdDev, % Universe(75%) -0.30 0.97 98.12 0.91 17.90 1.35 Morningstar Real Estate Universe Vanguard REIT Index I Universe(95%) -2.95 0.85 79.09 0.68 15.87 1.03 Cash MSCI US REIT NR USD City of Dover, Delaware Police Pension Plan 44

Quarterly Investment Monitor Data as of 12/31/2012 Glossary Alpha (3 Yr) % Assets in Top 10 Holdings Alpha is a measure of the difference between a portfolio’s actual returns and its expected performance, given its level of risk as The aggregate assets, expressed as a percentage, of the fund's top 10 portfolio holdings. This figure is meant to be a measure of portfolio measured by beta. A positive alpha figure indicates the portfolio has performed better than its beta would predict. In contrast, a negative risk. Specifically, the higher the percentage, the more concentrated the fund is in a few companies or issues, and the more the fund is alpha indicates the portfolio has underperformed, given the expectations established by beta. susceptible to the market fluctuations in these few holdings. The figure is calculated from the most recent available fund holdings. Average Effective Duration Price/Book Ratio TTM A measure of a fund's interest-rate sensitivity--the longer a fund's duration, the more sensitive the fund is to shifts in interest rates. The weighted average of the price/book ratios of all the stocks in a fund’s portfolio. The P/B ratio of a company is calculated by dividing the Duration is determined by a formula that includes coupon rates and bond maturities. Small coupons tend to increase duration, while market price of its stock by the company’s per-share book value. Stocks with negative book values are excluded from this calculation. In shorter maturities and higher coupons shorten duration. The relationship between funds with different durations is straightforward: A theory, a high P/B ratio indicates that the price of the stock exceeds the actual worth of the company's assets, while a low P/B ratio indicates fund with a duration of 10 years is twice as volatile as a fund with a five-year duration. Morningstar prints an average effective duration that the stock is a bargain. statistic that incorporates call, put, and prepayment possibilities. Price/Earnings Ratio TTM Average Effective Maturity The weighted average of the price/earnings ratios of the stocks in a fund’s portfolio. The P/E ratio of a stock is calculated by dividing the Average effective maturity is a weighted average of all the effective maturities of the bonds in a portfolio. Effective maturity takes into current price of the stock by its trailing 12 months’ earnings per share. In computing the average, Morningstar weights each portfolio holding consideration mortgage prepayments, puts, calls, adjustable coupons, and other features of individual bonds and is thus a more by the percentage of equity assets it represents, so that larger positions have proportionately greater influence on the fund’s final P/E. accurate measure of interest-rate sensitivity. Longer-maturity funds are generally considered more interest-rate sensitive than their shorter counterparts. R-Squared Beta Reflects the percentage of a fund’s movements that can be explained by movements in its benchmark index. An R-squared of 100 indicates that all movements of a fund can be explained by movements in the index. Thus, index funds that invest only in S&P 500 stocks will have an A measure of a fund’s sensitivity to market movements. The beta of the market is 1.00 by definition. Morningstar calculates beta by R-squared very close to 100. Conversely, a low R-squared indicates that very few of the fund’s movements can be explained by movements in 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 its benchmark index. An R-squared measure of 35, for example, means that only 35% of the fund’s movements can be explained by fund has performed 10% better than its benchmark index in up markets and 10% worse in down markets, assuming all other factors movements in the benchmark index. remain constant. Conversely, a beta of 0.85 indicates that the fund’s excess return is expected to perform 15% worse than the market’s excess return during up markets and 15% better during down markets. Sharpe Ratio The Morningstar Rating The Sharpe Ratio is a risk-adjusted measure developed by Nobel Laureate William Sharpe. It is calculated by using standard deviation and excess return to determine reward per unit of risk. The higher the Sharpe Ratio, the better the portfolio’s historical risk-adjusted performance. 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 It can be used to compare two portfolios directly on how much excess return each portfolio achieved for a certain level of risk. one to five stars, with the best performers receiving five stars and the worst performers receiving a single star. Standard Deviation Risk-adjusted return is calculated by subtracting a risk penalty from each fund total return, after accounting for all loads, sales charges, and redemption fees. The risk penalty is determined by the amount of variation in the fund's monthly return, with emphasis on downward Standard deviation is the statistical measurement of dispersion about an average, which depicts how widely a stock or portfolio’s returns variation. The greater the variation, the larger the penalty. Funds are ranked within their categories and stars are assigned as follows: 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 Top 10% five stars; Next 22.5% four stars; Middle 35% three stars; Next 22.5% two stars; Bottom 10% one star. most likely for a given investment. When a stock or portfolio has a high standard deviation, the predicted range of performance is wide, implying greater volatility. Audited Expense Ratio Total Number of Holdings The percentage of fund assets paid for operating expenses and management fees, including 12b-1 fees, administrative fees, and all other asset-based costs incurred by the fund, except brokerage costs. Fund expenses are reflected in the fund’s NAV . Sales charges The total number of different holdings of a fund. This figure is meant to be a measure of portfolio risk. Specifically, the lower the figure, the are not included in the expense ratio. more concentrated the fund is in a few companies or issues, and the more the fund is susceptible to the market fluctuations in these few holdings. This figure also provides a context for the importance of % assets in top 10 holdings. The figure is calculated from the most recent Geometric Average Market Capitalization available fund holdings. It does not include a fund’s short positions. Morningstar defines the overall "size" of a stock fund's portfolio as the geometric mean of the market capitalization for all of the stocks it Total Return owns. It's calculated by raising the market capitalization of each stock to a power equal to that stock's stake in the portfolio. The resulting numbers are multiplied together to produce the geometric mean of the market caps of the stocks in the portfolio, which is Expressed in percentage terms, Morningstar’s calculation of total return is determined each month by taking the change in monthly net asset reported as average market capitalization. value, reinvesting all income and capital-gains distributions during that month, and dividing by the starting NAV. Reinvestments are made This number is different from the fund's median market cap--the capitalization of the median stock in its portfolio. The geometric mean using the actual reinvestment NAV, and daily payoffs are reinvested monthly. better identifies the portfolio's "center of gravity." That is, it provides more accurate insight into how market trends (as defined by capitalization) might affect the portfolio. Turnover Ratio Net Assets This is a measure of the fund’s trading activity which is computed by taking the lesser of purchases or sales (excluding all securities with maturities of less than one year) and dividing by average monthly net assets. A turnover ratio of 100% or more does not necessarily suggest The month-end net assets of the mutual fund, recorded in millions of dollars. Net-asset figures are useful in gauging a fund’s size, that all securities in the portfolio have been traded. In practical terms, the resulting percentage loosely represents the percentage of the agility, and popularity. They help determine whether a small company fund, for example, can remain in its investment-objective category portfolio’s holdings that have changed over the past year. if its asset base reaches an ungainly size. 12-Month Yield Also known as a distribution yield, Morningstar computes this figure by summing the trailing 12-month’s income distributions and dividing the sum by the last month’s ending NAV, plus any capital gains distributed over the same period. Income refers only to interest payments from fixed-income securities and dividend payoffs from common stocks. City of Dover, Delaware Police Pension Plan 45

Quarterly Investment Monitor Data as of 12/31/2012 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 46

(Abridged for Police Pension Board Meeting of February 14, 2013) City of Dover Council Financial Workshop January 7, 2013 • Update on Funding Status of Pension Plans and OPEB as of June 30, 2012 • GASB 67 & GASB 68 – Revised Pension Standards

City of Dover Police Pension Plan 2

Police Pension Plan Closed Plan – 48 retirees and beneficiaries; Approximately 50% in 55 – 65 age bracket as of last full actuarial valuation 3

Police Pension Plan City contribution has remained at $95,000 for several years. State Grant made up the remainder of the required contribution. FY13 will need to increase City appropriation. 4

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City of Dover Summary of Retirement Benefit Liabilities and Annual Required Contributions Interim Actuarial Report Dated 11/1/2011 With Full Funding Requirements (no-phase in period for OPEB) 15

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