The principal investment objectives of the Fixed Income Portfolio are that it must generate a level of current income sufficient to meet withdrawal needs, and the asset growth, exclusive of contributions and withdrawals, should exceed the rate of inflation in order to preserve purchasing poser of assets. The portfolio goal is to produce, after investment expenses, a minimum annual compound rate of return of 2.00% in excess of the rate of inflation as measured by the National Urban Consumer Price Index (CPI). This objective will be reviewed on a three year basis, at a minimum.

The principal investment objectives of the Moderate Portfolio are that the fund should, through a combination of investment income and capital appreciation, grow at a rate greater than the return on a balanced market index, while incurring less risk than such index. The asset growth, exclusive of contributions and withdrawals, should exceed the rate of inflation in order to preserve purchasing power of assets. It should also be recognized that short-term fluctuations in the capital markets may result in the loss of capital on occasion (i.e., negative rates of return). However, the asset value of the portfolio, exclusive of contributions to the plan, should be maintained and grow in the long-run. Proper diversification of assets must be monitored in order to assure preservation of the principal value of the fund and reduce portfolio risk for the fund. The fund should also generate a level of current income sufficient to meet withdrawal needs. The portfolio goal is to produce, after investment expenses, a minimum annual compound rate of return of 3.50% in excess of the rate of inflation as measured by the National Urban Consumer Price Index, (CPI). This objective will be reviewed on a three year basis, at a minimum.

The principal investment objectives of the Growth portfolio are that through a combination of investment income and capital appreciation, the fund should grow at a rate greater than the return on a balanced market index, while incurring less risk than such index. Also asset growth, exclusive of contributions and withdrawals, should exceed the rate of inflation in order to preserve purchasing power assets. It should also be recognized that short-term fluctuations in the capital markets (greater than the Moderate Portfolio) may result in the loss of capital on occasion (i.e., negative rates of return). However, the asset value of the fund, exclusive of contributions to the plan should be maintained and grown in the long-run. Proper diversification of assets must be monitored in order to assure preservation of the principal value of the fund. The portfolio goal is to produce, after investment expenses, a minimum annual compound rate of return of 3.90% in excess of the rate of inflation as measured by the National Urban Consumer Price Index (CPI). This objective will be reviewed on a three year basis, at a minimum.

With the exception of the Fixed Income Portfolio, each account is expected to meet or exceed the rate of return of a balanced market index comprised of the Standard and Poor’s 500 Index, the Shearson Lehman Government Corporate Index, Russell 2000 Index, the Morgan Stanley EAFE Index and the 90 day U.S. Treasury Bill in similar proportion to the long-term average asset mix of the various portfolios. The Fixed Income Portfolio will be measured against the SLGC Index and the 90 Day U.S. Treasury Bill in similar proportion to the long-term average asset mix. It is expected that the accounts will provide an appropriate amount of liquidity for the current withdrawal liabilities of the Foundation.