Malcolm E. Polley, CFA President, Chief Investment Officer Richard J. Scotti Vice President, Institutional Sales

Franklin Regional Retirement System

January 11, 2012

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Table of Contents Firm Overview ………………………………………………………………....…………..… 3

Large Cap Value Composite Performance ……………………………….…..…….….… 4

Investment Philosophy and Process ………………………………….…..….…………… 5

Sell Discipline ………………………………….……………………………….…..……..… 9

Large Cap Value Composite Characteristics ……………………………….…..….….… 11

Why Stewart Capital …………………………………………………………………….…. 13

Appendix

Organizational Chart ………………………………………………………….……… 14

Biographies ………………………………………………………………….………... 15

Fees …………………………………………………………………………….……… 19

Disclosures ……………………………………………………………….…………… 20

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Firm Overview Since 2001, Stewart Capital Advisors, LLC* has been managing domestic equity, fixed income and asset allocation portfolios.

Wholly-owned subsidiary of S&T Bank.

As of 9/30/11, we manage nearly $920 million for over 1,400 accounts.**

As of 9/30/11, we manage $61 million in large cap value assets for 72 accounts.

Members of our team are experienced professionals:

Includes original architects of our process

Investment professionals average over 15 years of investment experience

Philosophy and disciplined process applied across all products.

Stable organization with low turnover.

Stewart Capital Offers Investment Management Services

All Cap Equity Composite Large Cap Value Composite Fixed Income Composite Mid Cap Equity Composite

• Subadvisory Services • Mutual Fund Asset Allocation

Total Firm Assets Number of Assets Client Type Accounts (millions)

Corporate 104 $239.2 Endowment/Foundation 25 30.5 Healthcare 19 36.5 High Net Worth 1,270 578.0 Mutual Funds 1 25.6 Public 1 4.7 Religious Orders 18 5.1 Taft Hartley 1 0.1 Total** 1,439 919.9

* Registered Investment Advisor as of December, 2005. **Asset and account information are as of September 30, 2011. Assets shown are full discretionary assets and also represent Stewart Capital’s dual role as exclusive sub advisor to S&T Wealth Management. Please refer to our Disclosures page for a complete description of the firm’s composites.

4 4

Large Cap Value Composite Performance as of 9/30/11

Ranks in the top decile versus large cap value managers on a year-to-date, one-, three-, and five-year basis.

Considered top quartile on a rolling three-year basis for 11 consecutive quarters.

Outperformed in each of the last three calendar years.

One of the lowest standard deviations on a three-year basis in the large cap value portfolios in the industry.

Information ratio of 2.18 on a one-year basis, 0.95 on a three-year basis and 1.04 on a five-year basis.

2.6%

11.7%

5.3% 3.8% 6.6%

-11.3%

-1.9% -1.5% -3.5%

3.8%

-20%

-10%

0%

10%

20%

YTD 1 Year 3 Year 5 Year Since Inception (8/2003)

15.7% 23.2%

-21.5%

-0.2%

12.2% 2.0%

16.7% 15.5% 19.7%

-36.9%

-0.2%

22.3%

7.1% 16.5%

-45%

-30%

-15%

0%

15%

30%

45%

2010 2009 2008 2007 2006 2005 2004

Annualized Rolling Performance (9/30/11)

Annual Performance (12/31)

Large Cap Value Composite Russell 1000 Value Index

Information from the eVestment Alliance database Please refer to our Disclosures page for more performance information.

5

Our Investment Philosophy

We believe in active management.

There is nothing wrong with taking risk as long as you get paid adequately.

Long-term trends make money.

Understand what you buy.

Pay attention to price.

“Value and business continuity has the potential to outperform short-term trends.”

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Our Investment Process

Investable Universe

Top Down View

Identify Investment

Themes

Bottom Up Research

Identify Stocks Positioned to Capitalize on Each Theme

Portfolio Construction

Sector Allocation

Stock Selection

Client Investment

Guidelines

Portfolio 25 – 50 Stocks

Our investment process is disciplined, well defined and repeatable. We consider approximately 5,000 stocks in our universe and other equity securities of

appropriate market capitalization.

Our top-down macroeconomic analysis uncovers thematic opportunities.

Using our proprietary fundamental research and rigorous stock selection, we identify sectors and companies positioned to capitalize on selected themes.

-15%

-10%

-5%

0%

5%

10%

15%

10% 15% 20% 25% 30% 35%

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Integrated Risk Control as of 9/30/11

A Well-Diversified Portfolio 25 – 50 stocks

Exposure to all sectors

Scaled Purchases and Sales Positions are increased on

rising conviction

Positions are trimmed if conviction decreases

Information from the eVestment Alliance database Please refer to our Disclosures page for more information on sector exposures and composite descriptions.

Information derived from representative account.

Low Risk Characteristics Large Cap tracking error to benchmark

Range: 4.5 – 8.0%

3 Year Risk/Return

Standard Deviation

Retu

rn

Stewart Capital: Large Cap Value Composite Benchmark: Russell 1000 Value Index Universe Median

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Buy Example

Macro-economic analysis Theme: Globalization – Movement up the economic food chain Core Sector: Consumer Staple

Characteristics at purchase Capitalization: $96.65 billion Projected Growth Rate: 9.9% Forward P/E:14.38X Dividend Yield: 3.33% Projected Dividend Growth Rate: 11.5%

Fundamental research Major player in soft drinks, non-carb beverages and salty snacks Demographics favor increased discretionary spending on company products. Earnings not as impacted by economic conditions Stock price negatively impacted by expectations for lower North American Beverage prices

Portfolio construction Initial Position Size: Approx. 4.4%

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Sell Discipline Stewart Capital portfolio managers adhere to a strict sell discipline to protect client portfolios. Positions are sold if any of the following occur:

Stock becomes fairly valued Stewart Capital calculates specific price targets and are updated regularly If target price is achieved, and we can no longer justify the valuation

Stock can be replaced with a better risk/reward opportunity Portfolio managers continually seek additional investment opportunities. Current holdings may

be replaced with other securities that demonstrate better upside potential, better valuation characteristics and/or a lower risk profile.

Price decline of 25% Any discrepancy in performance to a company’s sector and/or market is reviewed by the

Investment Policy and Strategy Committee. If the cause is fundamental in nature, the stock is sold from the portfolio.

Merger or acquisition Portfolio managers evaluate the acquiring company to determine whether it is appropriate

to the portfolio asset class. If the acquiring company is an unattractive candidate, the stock is sold.

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Sell Example

Original thesis Theme: Need to expand global grain production. Core Sector: Basic Materials Projected Earnings Growth: 26% Forward P/E:19.71X Dividend Yield: 2.09% Projected Dividend Growth Rate: 20%+

Sell rationale Company facing increased competition as Chilean government decides to end Company’s sole

access to the Atacama Salt Flats

Significant run-up in price caused by expectations of the fertilizer industry and the expectations for growth in lithium used in batteries

Stock up 158% (price appreciation only) since initial purchase

Stock trading significantly above our intrinsic value estimate with no justification for higher estimate

Sell stock with 185% gain since initial purchase

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0%

5%

10%

15%

20%

25%

30%

Consumer Discretionary

Consumer Staples

Energy Financials Healthcare Industrials Information Technology

Materials Telecom Services

Utilities

Large Cap Value Composite Russell 1000 Value Index

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Sector Exposure

Large Cap Value Composite Characteristics as of 9/30/11

Portfolio Characteristics Number of Holdings

Average Market Cap

(billions)

P/E Ratio (forecasted***) P/B Ratio Dividend

Yield

3 Year Tracking

Error % Cash

Large Cap Value Composite 25 $65.28 14.72 2.99 4.22% 2.08% 9.16%

Russell 1000 Value Index 1,000 $66.46 11.44 1.29 2.85% ---- ----

Please refer to our Disclosures page for more information on sector exposures and composite descriptions. Information derived from representative account. *** Forecasted for rolling 12 months Source: eVestment Alliance, & Standard & Poors

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Please refer to our Disclosures page for more information on the composite’s top ten holdings and composite descriptions. Information derived from representative account.

Large Cap Value Composite Holdings as of 9/30/11

Top 10 Holdings (% of Portfolio) Sector Weightings (%)

Polaris Industries Consumer Discretionary 5.67%

Kimberly Clark Corp Consumer Staples 5.47%

Abbott Laboratories Healthcare 5.34%

The JM Smucker Co. Consumer Staples 5.33%

Verizon Communications Telecommunications 5.24%

ONEOK Inc. Utilities 4.86%

Weiss Markets, Inc. Consumer Staples 4.44%

3M Company Industrials 4.42%

Exxon Mobil Corp Energy 4.27%

Terra Nitrogen Company Materials 4.14%

Total 49.18%

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What sets Stewart Capital apart?

PERFORMANCE Large Cap Value Composite Outperformed the benchmark by 1,400,

683, 732, 372, and 281 basis points on a one-, three-, five-, seven-year, and since inception basis respectively as of 9/30/11.

Risk characteristics consistently among the lowest of all large cap value managers.

CONSISTENCY Large Cap Value is top quartile on a rolling

three-year basis for 11 consecutive quarters.

Large Cap Value has outperformed the Russell 1000 Value Index in each of the last three years.

Information from the eVestment Alliance database. Please refer to our Disclosures page for more information.

DISCIPLINED, REPEATABLE PROCESS Process accentuates our proprietary

fundamental research

Combines top-down and bottom-up investment approaches

Risk management fully integrated throughout portfolio construction

Team oriented approach

Organization Overview

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Malcolm Polley, CFA President,

Chief Investment Officer

Richard Scotti Vice President,

Institutional Sales

Matthew DiFilippo, CFA Chief Portfolio Strategist,

Portfolio Manager

Karen Hackman Vice President,

Relationship Manager

Josh Gerwick Research Analyst /

Investment Management Assistant

Marina Stephens Investment Management

Assistant

Christine Moran Administrative Services

Specialist Tim McKee

Compliance Officer

Michelle Sears Assistant

Compliance Officer

Christian Minich Intern

Nicholas Westrick Associate

Portfolio Manager

Helena Rados Derr Vice President,

Portfolio Manager

Charles Frank, CFA Vice President,

Portfolio Manager

Jonathan Pavlik Vice President,

Portfolio Manager

Priscilla Dickie, Relationship Administrator

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Investment Team Malcolm E. Polley, CFA President and Chief Investment Officer

Malcolm serves as president and chief investment officer of Stewart Capital Advisors, where he oversees the investment team and is responsible for asset management, research, performance evaluation, and asset allocation strategies.

He also serves executive vice president and managing director of S&T Wealth Management, and is responsible for providing strategic direction for and leadership to all of the group’s subdivisions – Wealth Management Services, Financial Services and Stewart Capital Advisors.

Malcolm has nearly 25 years of experience in the investment and financial services industry, including almost 10 years of service with S&T Bancorp. He became chief investment officer of S&T Wealth Management in 2001 and established investment processes that transformed the department from three employees to nine.

Malcolm then led the effort to form Stewart Capital Advisors, LLC, a registered investment advisory subsidiary. He also spearheaded the development of the Stewart Capital Mid Cap Fund, and is a member of the investment team that has managed the Fund since it commenced operations in December 2006.

Malcolm holds the Chartered Financial Analyst® designation, and currently serves as president of the CFA Society of Pittsburgh. He received a BBA in finance from Iowa State University. Additionally, Malcolm served as an adjunct faculty member at the Eberly College of Business, Indiana University of Pennsylvania.

He has been quoted extensively in the business press and is a frequent guest on CNBC’s Squawk Box, Squawk on the Street, Power Lunch and Closing Bell; Fox Business; Bloomberg TV; and Bloomberg Radio.

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Investment Team Matthew A. DiFilippo, CFA Chief Portfolio Strategist

As chief portfolio strategist, Matt chairs the Investment Policy and Strategy Committee, oversees the investment team and guides equity research. Matt is the lead analyst for the health care and telecommunications sectors and contributes to fixed income research.

Prior to joining Stewart Capital Advisors and S&T Wealth Management , he was employed with Mellon Bond Associates, Mellon Financial, and Scottsdale Securities.

Matt earned his degree in business administration with a major in finance from Robert Morris University. Matt holds the Chartered Financial Analyst ® designation. He is also a member of the CFA Institute (CFAI) and the Pittsburgh Society of Financial Analysts.

Matt appears regularly as a resource in the financial press providing commentary on the economy and the markets.

Charles G. Frank, CFA Senior Portfolio Manager

Chuck is responsible for portfolio management, strategy and research for private client fixed-income assets and is a member of the all-cap, mid-cap, and equity income teams. He has over 27 years of investment management experience and has been with S&T for over 20 years.

Prior to joining Stewart Capital Advisors and S&T Wealth Management , he was a portfolio manager with Rhode Island Hospital Trust and the Princeton Trust Company. Chuck is a graduate of the University of Pittsburgh and the University of Rhode Island Graduate School of Business.

He holds the Chartered Financial Analyst ® designation and is a member of the CFA Institute (CFAI), as well as the Rotary Club of Indiana, Pennsylvania. Chuck speaks with the financial press on the bond markets. He has been quoted in Credit Investment News, Bloomberg News, and Investment News.

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Investment Team Jonathan V. Pavlik Portfolio Manager

As a portfolio manager, Jonathan is responsible for management of private client asset allocation portfolios. Additionally, he supports research and analysis within our fixed income investment process and provides support for the firm’s all-cap, mid-cap, and equity income teams.

Prior to joining Stewart Capital Advisors and S&T Wealth Management, he was employed with PNC Capital Markets and Federated Investors.

Jonathan earned a BS in accounting with a minor in finance from St. Vincent College. He holds both a Series 7 and 63 securities license.

Helena Rados Derr Portfolio Manager

As a portfolio manager, Helena is responsible for management of private client asset allocation portfolios. Additionally, Helena updates and performs research on industries and individual companies to support the firm’s all-cap, mid-cap, and equity income styles. She also provides economic research for the team.

Prior to joining Stewart Capital Advisors and S&T Wealth Management , she was employed with the retail department of First Commonwealth Bank.

Helena received an MBA in finance and a BA in economics, with a minor in German from Indiana University of Pennsylvania.

Nicholas Westrick Associate Portfolio Manager

As an associate portfolio manager, Nick is responsible for managing mutual fund asset allocation portfolios. His research responsibilities include mutual funds and the consumer discretionary and technology sectors. He is a voting member of the Investment Policy and Strategy Committee. Prior to joining Stewart Capital Advisors and S&T Wealth Management, he was employed as a credit analysis for S&T Bank. He has a bachelor’s degree in finance from Indiana University of Pennsylvania.

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Investment Team Joshua Gerwick Research Analyst/Investment Assistant

Josh is responsible for trading, research, and support. Prior to starting his current position with Stewart Capital Advisors and S&T Wealth Management, he was employed as an intern for the department. He has a BA in economics and mathematics from Indiana University of Pennsylvania.

Marina Stephens Investment Assistant

Marina is responsible for mutual fund trades and performing directed trades, as well as reporting account and composite performances. She is also responsible for processing various reports and security litigations. She has a BS in business (concentration in financial services) from The Pennsylvania State University.

Christine Moran Administrative Services Specialist

Christine is the assistant to the president and chief investment officer as well as trading, research and support to entire portfolio management team. Prior to joining the Stewart Capital Advisor and S&T Wealth Management, she was involved in various capacities on the retail side of S&T Bank. Christine has over six years of experience in the financial services industry and has completed coursework with the American Bankers Association.

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Fees Large Cap Value Composite 0.70% on the first $10,000,000

0.60% on the next $20,000,000

0.50% on the remaining assets

Minimum fee is $10,000

Disclosures Year End

Total Firm Assets

(thousands)

Strategy Assets

(thousands)

Composite Assets

(thousands) Number of Portfolios

% of Carve Outs

DJ US Total Full

Cap

Annual Performance Results

Composite Composite Dispersion Gross Net

2010 1,014,190 5,188 403 1 - 17.69% 15.67% 14.75% N/A 2009 938,870 3,766 3,766 5 79.22% 29.33% 23.20% 21.99% N/A 2008 529,183 5,131 5,131 7 53.90% -37.34% -21.51% -22.30% 7.02% 2007 882,835 9,143 9,143 18 59.89% 5.74% -0.23% -1.22% 1.52% 2006 1,026,382 7,323 7,323 18 49.56% 15.87% 12.19% 11.09% 0.74% 2005 - 15,704 15,704 19 23.41% 6.33% 2.03% 1.02% 0.84% 2004 - 8,673 8,673 11 18.97% 12.62% 16.68% 15.54% N/A

Aug-Dec 2003 - 2,667 2,667 3 100.00% 13.85% 10.12% 9.67% N/A

N.A. - Information is not statistically meaningful due to an insufficient number of portfolios in the composite for the entire year.

Year End

3-yr Annualized Standard Deviation 3-yr Annualized Return

Composite Benchmark Composite Benchmark 2010 18.79% 22.52% 3.80% -1.57% 2009 17.09% 20.20% -1.19% -5.02% 2008 12.25% 15.80% -4.24% -8.43% 2007 7.05% 8.20% 4.50% 9.22% 2006 6.36% 7.66% 10.10% 11.54% 2005 N/A N/A N/A N/A

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The Large Cap Value Composite contains discretionary portfolios that invest in a diversified group of equities with whose dividend yields that exceed that of the Russell 1000 Value Index at the time of purchase. Additionally, convertible securities and covered calls may be used from time to time. For comparison purposes, the composite is measured against the Russell 1000 Value Index. The minimum account size for this composite is $250 thousand. Prior to April 2008, the minimum account size for this composite was $100 thousand. In presentations prior to July 2010, the Large Cap Value Composite was known as the Equity Income Composite. During that time, the composite was also benchmarked against the Dow Jones US Total Full Cap Index. The benchmark was changed to more accurately reflect the strategy of the composite, which historically leaned toward investments in companies with larger capitalizations. The Russell 1000 Value Index has been applied retroactively in this presentation. Stewart Capital Advisors, LLC has prepared and presented this report in compliance with the Global Investment Performance Standards (GIPS®). Stewart Capital is an independent registered investment adviser that was formed on August 1, 2006. Investment performance prior to August 1, 2006 was achieved by S&T Wealth Management Group. On that date, the investment process and those responsible for investment decisions moved from the S&T Wealth Management Group to Stewart Capital. The firm maintains a complete list and description of composites, which is available upon request. Results are based on fully discretionary portfolios under management, including those portfolios no longer with the firm. Composite performance is presented net of foreign withholding taxes on ADR dividends. Past performance is not indicative of future results. The U.S. Dollar is the currency used to express performance. Returns are presented gross and net of management fees. Net of fee performance was calculated using the highest applicable management fee applied monthly. Additional information regarding the policies for calculating and reporting returns is available upon request. The annual investment management fee schedule for the composite is 1% on the first $1 million, 0.75% on the next $5 million, and 0.50% on the remainder. Actual investment advisory fees incurred by clients may vary. Prior to January 1, 2010, carve-outs were included in this composite and performance reflects required total segment plus cash returns using predetermined pro-rata distribution based on the allocation to fixed income and equities at the composite level. Internal dispersion is calculated using the equal-weighted standard deviation of all portfolios included in the composite for the entire year. The decrease in Large Cap Value composite assets in 2010 is due to removing Large Cap Value equity segments that are part of a larger portfolio strategy from the composite. Strategy Assets as displayed in the table above are shown as supplemental information and reflect the market value of all portfolio segments invested in the Large Cap Value strategy regardless of the larger portfolio strategy. The Large Cap Value Composite was created August 1, 2006. Stewart Capital Advisors, LLC’s compliance with the GIPS standards has been verified for the period 1/1/03 through 9/30/11 by Ashland Partners & Company LLP. A copy of the verification report is available upon request.