Rorer Asset Management, LLC

HAS RORER'S INVESTMENT PROCESS REMAINED CONSISTENT OVER TIME?

Yes. Rorer's Equity Philosophy of buying high quality, "out of favor" companies with a catalyst in place for them to return to favor, has not changed since its implementation by Edward C. Rorer, Chairman and Chief Investment Officer, in 1978. However, in 1984 several quantitative disciplines were developed to provide a framework to guide the stock selection process within Rorer's philosophy. This philosophy and investment process has withstood the test over many challenging market and economic conditions. The firm has found that by remaining steadfast in its investment approach, it has been able to provide clients with excellent risk-adjusted returns across investment cycles.

WHAT DO YOU MEAN BY "RELATIVE" VALUE?

Relative Value compares a company's valuation today relative to the market (as defined by the S&P 500) versus 5-year historical norms. The criteria analyzed in this study are Price-to-Earnings, Price-to-Book, Price-to-Cash Flow, Price-to Revenue, and Dividend yield.

WHAT DO YOU MEAN BY "EARNINGS MOMENTUM"?

Earnings momentum measures upward estimate revisions of IBES consensus estimates. Where there is a pattern of rising estimates and/or positive earnings surprise, the company survives the earning momentum analysis and may be considered for further study and possible inclusion in the portfolio.

WHEN DO YOU SELL A STOCK?

Rorer's discipline was designed to eliminate the emotion often associated with the decision of whether or not to sell a particular stock. In its implementation, it seeks to realize substantial profits after they have been earned or, conversely, to conserve capital when circumstances so dictate. Specifically, an upside price objective is established at the time of purchase. This price target is set at a level that the stock is reasonably expected to achieve within an 18-24 month time frame. Alternatively, a stock will be sold if its fundamentals fail to meet expectations or if its stop/loss provision, calculated from the firm's average cost, forces the sale of any security, which, as a full position, deteriorates 15 percent relative to the S&P 500 Index (20% relative to the S&P MidCap 400 Index for Mid-Cap). Together these disciplines form a solid investment strategy with the objective of controlling risk and performance volatility.

WHO ARE THE RORER MARKETING, INVESTMENT SERVICE, AND OPERATIONS/BACK OFFICE CONTACTS?

SEE INVESTMENT SERVICES COVERAGE.

WHAT IS THE DIFFERENCE BETWEEN RORER'S RESEARCH ANALYSTS AND ITS PORTFOLIO MANAGERS?

While Rorer's Research Analysts and Portfolio Managers work closely together, their roles are distinctly different.

The Research Team is responsible for the quantitative and fundamental research involved in security selection, they do not manage individual client portfolios or make new business and client review presentations. Research Analysts visit companies and attend company and industry sponsored seminars and conferences.

Portfolio Managers are devoted to maintaining strong relations with existing clients and financial consultants. They do not perform research on stocks in the portfolios. Portfolio Managers review client portfolios to ensure that policy decisions are implemented in accordance with overall investment strategy and any client specific guidelines. Portfolio managers also participate in new business presentations and client review meetings when appropriate

WHAT IS THE ROLE OF THE INVESTMENT CONSULTANT?

With few exceptions, all Rorer clients interact with an investment consultant who has referred them to Rorer as clients. The consultant performs a level of due-diligence on Rorer, which is ongoing, and has first hand knowledge of client investment goals. One very important role of the consultant is to manage the client's expectations and long-term investment objectives as they pertain to the Rorer investment style. Determining suitability and proper expectations of an investment manager ensures a successful long-term relationship.

WHAT ARE THE BENEFITS OF MANAGED ACCOUNTS?

Managed accounts (also referred to as "separate" accounts), offer individual investors both additional control and flexibility historically available only to the wealthiest individuals and largest institutions. Within a managed account program, customized portfolios can be chosen to meet investment guidelines. Portfolios can be tax-managed if desired, but already provide tax advantages over pooled accounts. Management fees can be assessed against the portfolio or invoiced separately, and may be tax deductible. Because of the individually managed nature of these accounts, they are most appropriate for an initial minimum investment of at least $100,000.

WHO IS AMG, AND WHAT DOES YOUR AFFILIATION MEAN?

Affiliated Managers Group, Inc. (AMG) is a Massachusetts-based, NYSE-listed holding company, which makes equity investments in mid-sized investment management firms. AMG's strategy is to generate growth through investments in new affiliates, as well as through the internal growth of existing affiliated firms. On January 6, 1999, Rorer became an AMG affiliate. Rorer's partnership gives AMG a majority interest while the senior management team of Rorer continues to control a significant interest. The merger of the two firms allowed Rorer to extend ownership to 20 key employees intending to reward and retain members of the management team while providing a future strategy for succession and an orderly process for cycling ownership to the next generation. While AMG holds a majority interest, Rorer's current management continues to control the firm's operations. The affiliation allows Rorer to remain autonomous with its decision policies and procedures.

WHO IS MANAGERS INVESTMENT GROUP, AND WHAT DOES YOUR AFFILIATION MEAN?

Rorer has partnered with Managers Investment Group (Managers), an independently managed subsidiary of Affiliated Managers Group (AMG), to market, sell and service their clients. Managers is an organization which will create, distribute, and service separate account, mutual fund and structured products through intermediaries, primarily in segments of the high net worth marketplace.

HOW DO I ESTABLISH A NEW ACCOUNT?

There are three steps involved in setting up a new portfolio for a client: Documentation, Current Portfolio Review and Trading. First, necessary documents must be received (i.e., signed contracts, client policy statement and custodial information). Secondly, the client's current portfolio is reviewed to identify any similar securities that are currently in the Rorer portfolio or any special instructions from the client. Finally, trading takes place in the account. Securities currently held by the client which are not part of the Rorer model are sold, while new positions are purchased to structure the new account in accordance with the Rorer model portfolio. This process usually takes about two to three days.

NEW ACCOUNT SET-UP CHECKLIST

WHEN ARE CLIENT STATEMENTS AVAILABLE?

For advisory relationships only, Rorer provides a comprehensive quarterly statement (portfolio review) of each account. These portfolio reviews are generated once accounts are reconciled with those of the account's custodian. The reviews are received approximately three to four weeks after quarter-end, depending upon the timely receipt of statements from each custodian.

Clients will continue to receive monthly statements from the account custodian (brokerage firm or bank trust department). In broker/dealer relationships where Rorer functions as a sub-advisor, we are frequently asked not to provide this information, to prevent duplication.

IS IT POSSIBLE TO SET UP PORTFOLIO RESTRICTIONS?

Rorer provides social screening as a service for our clients. Rather than provide one screening process that would apply to all screened clients, our clients can choose from the more than 20 pre-defined social screens that we maintain in-house. Our clients are able to select those social screens, which are important to them.

When a stock is purchased into the Rorer Model Portfolio and the client restricts that stock, it would not be purchased into the restricted portfolio. Rather, we will overweight unrestricted holdings in the portfolio, resulting in security, industry, and sector weightings in restricted portfolios that differ, sometimes materially, from the unrestricted Rorer Model Portfolio. We do not substitute with names not currently in the Rorer Model Portfolio.

While any of the listed restrictions can be implemented in a non sub-advisory account, as well as restrictions against specific securities (tickers are provided by the client), we encourage clients not to be overly restrictive as this may result in performance that significantly deviates from the Model Portfolio.

WHICH ACCOUNT CHANGES REQUIRE A SIGNATURE?

In advisory relationships all account changes require a client signature. However, in sub-advisory relationships the broker (as authorized representative for client) approval is acceptable.

	These include, but may not be limited to:
	-	Investment objective change
	-	Asset allocation change
	-	Account termination
	-	Account liquidation
	-	Freeze account from buys/sells
	-	Change of address
	-	Tax selling

Please refer to your firm's guidelines for any additional requirements.

WHAT ARE YOUR ACCOUNT MINIMUMS?

Rorer accepts accounts valued at a minimum of $100,000 through financial consultants as long as a wrap fee is used. SOME FIRM MINIMUMS MAY BE HIGHER.

HOW DO YOU PERFORM TAX LOSS SELLING?

Rorer performs year-end tax loss selling only when directed by our clients through their financial consultant. A Tax Selling Client Request Form is completed and sent to Rorer specifying the tax loss-selling requested. We will sell any stocks that have losses up to a client's specified amount with a minimum $500 principal value. The proceeds of those sales will be held in cash for a minimum of 31 days, at which point previously sold securities may be repurchased if they continue to meet the portfolio's investment criteria.