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1201 Main Street | Suite 1910 Columbia, SC 29201 (803) 254-9500 www.ccminc.com

CCM CORE BALANCED

Founded: 1986

Ten Year Performance (Pure Gross of Fees)

BACKGROUND

Assets under Management: $2.29 Billion Staff (Total/Professional): 15/9 Investment Style: Relative Value/ Tactical Asset Allocation Investment Process: Bottom Up Equity Style: Relative Value Average Number of Equity Holdings: 50 Account Types: Equity / Balanced / Fixed Income * Index:  50% S&P 500 stocks / 50% Barclays U.S. Government/Credit bonds 

EQUITY PROCESS

Our stock selection process is based

on the premise that in the short run, equity markets are not “efficient,” and relative value can be identified through fundamental analysis. Individual stock selection is determined by relative value. We screen relevant financial data on over 1,500 public companies to identify potential investment candidates. Each company in our universe is then ranked by its relative value. Candidates include both growth and value stocks.

As investment managers, we are look-

ing for longer term relative value. We are not short term traders or speculators. Our approach searches for opportunities to profit in portfolios over the long term and only assumes risk consistent with expected potential return.

Ultimately,

our equity selection process results in the structuring of broadly diversified stock portfolios (35 to 65 positions). These portfolios have significantly greater expected return characteristics on a risk-adjusted basis than the stock market in general.

FIXED INCOME PROCESS

As

interest rate anticipators, our fixed income selection process begins with the formulation of our economic forecast. The forecast includes our expectations for changes in interest rates and the yield curve. The target duration and maturity structure is then determined based on these expectations.

Security

selection begins with relative value analysis, involving the evaluation of current market sector spreads, quality spreads, and specific security factors. Sector and quality spreads are monitored versus long term averages after considering business cycle and specific industry conditions. Default and maturity premiums are then tracked and analyzed on an ongoing basis.

We actively manage our fixed income portfolios to take advantage of inefficiencies within the different sectors of the fixed income markets. Implementation of these strategies when identifying undervalued bonds adds incremental return to the original portfolio duration decision.

BALANCED PROCESS

We believe that a disciplined, dynamic total portfolio management system that identifies relative value among asset classes, as well as individual securities, will provide consistently superior investment performance. Accordingly, our investment management process actively addresses all three basic decisions of portfolio management - asset allocation, security selection and timing. Our system compares the relative val-

ue of stocks, bonds and money market alternatives. The asset allocation system disciplines the portfolio manager to shift funds from overvalued assets to relatively undervalued assets within a timely, logical, and unbiased framework.

Our core balanced approach is appro-

priate for conservative investors desiring a competitive market return with considerable principal protection.


CCM INVESTMENT PHILOSOPHY “A disciplined, dynamic portfolio management system that identifies relative value among asset classes, in addition to individual securities, will achieve consistently superior investment performance.”

HISTORICAL INVESTMENT PERFORMANCE — CCM WRAP COMPOSITE Annual Total Returns 2007

2008

2009

2010

2011

2012

2013

2007-2016 2014

2015

2016

Annual Return

Risk (Std Dev)

3 Year Std Dev (Ex-Post)

CCM PURE GROSS OF FEE RETURNS Equities

11.8

-36.3

35.5

13.0

2.4

14.5

31.5

15.2

-0.7

9.5

7.8

19.7

11.4

Core Balanced

10.4

-27.2

25.7

10.4

2.7

11.1

21.6

11.9

-0.3

6.8

6.3

14.5

8.2

Moderate Risk Balanced

9.1

-22.8

21.2

9.5

2.6

9.4

17.1

9.3

0.4

5.4

5.5

11.9

6.1

Low Risk Balanced

7.3

-12.8

15.1

7.5

2.2

6.8

11.9

7.1

0.4

3.9

4.7

7.6

4.3

Fixed Income

6.8

4.3

5.4

4.0

4.4

3.6

-1.0

2.8

1.5

1.6

3.3

2.2

1.8

COMPARABLE INDEX RETURNS S&P 500 Stock Index

5.5

-37.0

26.5

15.1

2.1

16.0

32.4

13.7

1.4

12.0

6.9

18.9

10.6

50/50 Balanced Index

6.5

-17.1

15.6

11.4

6.1

10.5

14.1

9.9

1.0

7.6

6.1

9.3

5.4

40/40/20 Balanced Index

6.1

-13.5

12.7

9.1

4.9

8.4

11.2

7.8

0.8

6.1

5.1

7.4

4.3

20/40/40 Balanced Index

6.0

-5.3

7.5

5.9

4.3

5.2

5.0

5.1

0.5

3.7

3.7

3.7

2.4

Barclays US G/C Bond Index

7.2

6.0

4.5

6.5

8.7

4.8

-2.3

6.0

0.1

3.0

4.4

3.4

3.5

CCM NET OF FEE RETURNS Equities

9.0

-39.1

32.7

10.2

-0.4

11.7

28.7

12.1

-3.4

6.5

4.8

19.7

11.4

Core Balanced

7.6

-30.0

22.9

7.6

-0.1

8.3

18.8

8.9

-3.1

3.9

3.3

14.2

8.2

Moderate Risk Balanced

6.3

-25.6

18.4

6.7

-0.2

6.6

14.3

6.3

-2.3

2.5

2.5

11.6

6.1

Low Risk Balanced

4.5

-15.6

12.3

4.7

-0.6

4.0

9.1

4.2

-2.3

1.1

1.8

7.4

4.3

Fixed Income

5.4

2.9

4.0

2.6

3.0

2.2

-2.4

1.4

0.1

0.2

1.9

2.2

1.8

Pure gross of fee returns are supplemental data. Net returns for CCM products are adjusted for a maximum wrap fee of 2.8% (1.4% for Fixed Income).

REPRESENTATIVE CLIENTS Blue Cross/Blue Shield of S.C.  South Carolina Golf Associa on  City of Aiken, S.C.  Epworth Children’s Home  Representative clients are chosen based on portfolio size and conformity to CCM investment styles. They are clients who have agreed to serve as references for CCM Investment Advisers, LLC. Past performance of these accounts should not be considered a guarantee of future performance.


CCM MODEL EQUITY PORTFOLIO INVESTMENT STYLE ANALYSIS 

KEY INVESTMENT PERSONNEL Fowler W. Cary, Jr.

President

Mr. Cary is a forty-five year veteran of the investment industry. Mr. Cary founded Companion Capital Management (now CCM Investment Advisers, LLC) in 1986 and has served as President and Chief Investment Officer since that time. Mr. Cary was graduated from Wofford College and received his Master of Business Administration degree from the University of South Carolina. His primary responsibilities at CCM include strategic and tactical asset allocation, oversight of the equity and fixed income research process, fundamental research in the energy and health care sectors.

Robert F. Key, CFA

Senior Vice President

Chris W. Antley

Senior Vice President

Mr. Key began his career at the South Carolina National Bank and later moved to First Union Bank where he started and managed the Private Banking Group. He subsequently served as Treasurer of The Seibels Bruce Group. Mr. Key joined CCM in 1998 and his responsibilities include management of client portfolios, marketing and fundamental research in the finance sector. In addition, he serves as the Fixed Income Strategist for the firm. Mr. Key was graduated from Furman University and received his MBA from the University of South Carolina in 1982. He is a CFA Charterholder and has served as an adjunct professor of finance at the University of South Carolina.

EARNINGS ATTRIBUTES 

Mr. Antley joined CCM after graduating from the Honors College of the University of South Carolina in 1988 and then receiving his Master of Business Administration Degree from the University of South Carolina in 1990. During his twenty years at CCM, Mr. Antley has worked in all areas of investment management including quantitative modeling, asset allocation, macro-economic research, equity and fixed income fundamental research, and portfolio management. Mr. Antley serves as Chief Equity Strategist for CCM and is responsible for development of the CCM Equity Model. Mr. Antley is a guest lecturer at the U.S.C.'s Moore School of Business.

Michael A. Burkett, CFA

Vice President

Mr. Burkett joined CCM Investment Advisers after receiving his Bachelor of Science degree, Magna Cum Laude, from the University of South Carolina. His responsibilities at CCM include portfolio trading and management, information systems, performance composite, research on fixed income products as well as consumer discretionary and consumer staples equity sectors. Prior to his college studies, Mr. Burkett served in the United States Army 82nd Airborne Division, with a later posting to the Defense Language Institute. Mr. Burkett is a CFA Charterholder and is a past President of the CFA Society of S.C. Mr. Burkett is a guest lecturer at the U.S.C.'s Moore School of Business.

Rebecca F. Rhodes

Regional Marketing Director

Ms. Rhodes was graduated from the University of South Carolina in 1995. Prior to joining CCM, she served as Training Coordinator for IJL/Wachovia’s Investment Consulting Services division. Her responsibilities at CCM are marketing products and services to clients in the Southeastern region.

John D. Leaphart

SECTOR ALLOCATION 

Chief Compliance Officer

Mr. Leaphart earned a Master of Business Administration from the Goizueta Business School at Emory University in 2014 and a B.S.in Business Management from Clemson University in 1992. He began his career with CCM in 1994 as the firm’s first full-time trader, where he developed and implemented standardized trading procedures and practices. Mr. Leaphart currently serves as CCM’s Chief Compliance Officer, overseeing the implementation and application of securities regulations to CCM’s daily processes. Additional responsibilities include portfolio management, equity analysis, and information technology implementation.

Joe H. Giltner II, CFA

Vice President

Mr. Giltner joined CCM in 2011, after graduating from the Darla Moore School of Business at the University of South Carolina. He received his Bachelors of Science in business administration majoring in Corporate Finance and Investments. While perusing his degree Mr. Giltner served as research intern for CCM and joined the firm full time after graduation. He currently serves as a research analyst for equities and the macroeconomic environment. He is a CFA Charterholder.

Austin S. Fulmer

Assistant Vice President

Mr. Fulmer joined CCM Investment Advisers in 2011 after graduating from the University of South Carolina, Moore School of Business with a Bachelor of Science Degree in Business Administration with an emphasis in Finance. Prior to graduating Mr. Fulmer served as a research analyst intern for CCM. His responsibilities at CCM include equity research and analysis, fundamental research on the raw material sector, and information technology development for the firm. Mr. Fulmer is a 2016 Level II CFA candidate.

Glenn E. Bell, CPA, CFP ®

CPA/Financial Planner

Mr. Bell was graduated from the Lee University and received an MBA in Finance from the University of Eastern New Mexico. Mr. Bell served the firm of Burkett, Burkett & Burkett CPAs as a CPA and served in the finance department of Companion P&C. Mr. Bell’s responsibilities at CCM are assisting clients with their financial planning needs, as well as accounting responsibilities for the firm. Data from CCM’s Model Equity Portfolio as of 12/31/16. Charts above are provided as supplemental information.


PERFORMANCE FOOTNOTES CCM Investment Advisers, LLC claims compliance with the Global Investment Performance Standards (GIPS®) and has prepared and presented this report in compliance with the GIPS® standards. CCM Investment Advisers, LLC has been independently verified for the periods January 1, 2000 – December 31, 2015. The verification reports is available upon request. Verification assesses whether (1) the firm has complied with all the composite construction requirements of the GIPS® standards on a firm-wide basis and (2) the firm’s policies and procedures are designed to calculate and present performance in compliance with the GIPS standards. Verification does not ensure the accuracy of any specific composite presentation. 1. CCM Investment Advisers, LLC (CCM) is an independent investment advisory firm established in 1986. CCM manages a variety of equity, fixed income and balanced accounts for institutional and individual investors. 2. All accounts over which CCM has full investment discretion are included in the performance composite relevant to its strategy. Portfolios constrained by Investment Policies that differ materially from the investment strategy of CCM Investment Advisers are not included in a composite. Accounts less than $100,000 are not included in a composite with the exception of CCM Tech Select, where there is no minimum. A complete list and description of all of the firm’s composites is available upon request. 3. CCM's performance composites were created on 1/1/93. 4. Trade date valuation is utilized. 5. Valuations and returns are computed and expressed in US dollars. 6. Results are presented both net of all fees as well as gross of all fees including transaction fees. 7. Results assume reinvestment of dividends and interest, unless withdrawn from the portfolio by the client. 8. Prior to 1/1/2010, the CCM Equity Composite and Fixed Income Composite contain portfolios that are subsets of Balanced Portfolios. Cash is allocated to the Equity and Fixed Income portfolios based on the percentage weighting of equities or fixed income in the balanced portfolios. 9. Past performance is no guarantee of future results and the possibility of loss exists. 10. CCM Investment Advisers’ standard fee schedule for Balanced and Equity accounts is .75% of the first $7.5MM in assets, .65% for the next $7.5MM assets, .50% for the next $15MM assets, and .15% for assets over $30MM. For Fixed Income accounts, .50% of the first $10MM in assets, .35% for the next $10MM assets, and .25% for assets over $20MM. 11. A copy of CCM’s SEC Form ADV Part 1 and 2 is available upon request. 12. Policies for valuing portfolios, calculating performance, and preparing compliant presentations are available upon request. 13. All of the accounts in the composites are bundled fee accounts. The bundled fee includes trading, administrative and custodial charges. 14. The Barclay's Government/Credit Index is the non-securitized component of the U.S. Aggregate Index. The index includes US Treasuries, government-related issues and corporates. 15. The S&P 500 Index is a capitalization-weighted index of 500 stocks. The index is designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries. 16. The BofA Merrill Lynch 1-12 Year US Municipal Securities Index is a subset of The BofA Merrill Lynch US Municipal Securities Index including all securities with a remaining term to final maturity less than 12 years. 17. All blended benchmarks are static blends.

COMPOSITE STATISTICS CCM Composite

Composite Profile

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

# of Portfolios

137

133

127

126

109

165

162

176

224

234

Dispersion*

1.6%

2.4%

3.9%

1.3%

0.8%

1.0%

1.9%

1.2%

0.9%

1.1%

Total Assets

62.8

64.8

57.4

57.2

58.4

79.1

96.5

119.3

135.8

134.3

% of Firm Assets

3.2%

3.4%

2.7%

2.5%

2.3%

3.1%

3.4%

4.2%

4.9%

5.9%

# of Portfolios

34

25

27

32

23

26

23

21

18

18

Dispersion*

1.3%

2.0%

2.9%

1.0%

0.8%

1.3%

1.4%

0.9%

0.9%

0.4%

Core Balanced

Moderate Risk

Total Assets

13.1

7.6

7.6

10.0

8.1

9.4

9.7

10.2

8.8

8.7

% of Firm Assets

0.7%

0.4%

0.4%

0.4%

0.3%

0.4%

0.3%

0.4%

0.3%

0.4%

Low Risk

# of Portfolios

9

8

7

13

12

11

12

12

9

7

Dispersion*

1.2%

1.7%

2.5%

1.0%

0.8%

1.2%

2.0%

1.0%

0.8%

0.6%

Total Assets

3.8

3.2

2.7

4.8

4.7

4.6

5.1

4.9

3.2

2.6

% of Firm Assets

0.2%

0.2%

0.1%

0.2%

0.2%

0.2%

0.2%

0.2%

0.1%

0.1%

Equity

# of Portfolios

199

155

147

49

48

49

49

62

92

82

Dispersion*

1.6%

2.3%

4.6%

2.2%

1.0%

1.1%

1.1%

1.4%

1.6%

1.7%

Total Assets

71.5

55.6

50.1

13.0

58.1

63.3

78.9

100.7

105.4

102.3

% of Firm Assets

3.6%

3.3%

2.4%

0.6%

2.3%

2.5%

2.8%

3.5%

3.8%

4.5%

% Carve Out**

65.0%

71.5%

76.0%

# of Portfolios

40

40

47

13

12

9

7

7

10

11

Dispersion*

1.0%

3.7%

2.8%

0.8%

1.1%

1.1%

0.9%

0.9%

0.2%

0.5%

Total Assets

22.3

19.7

24.0

18.8

16.4

13.1

11.2

11.2

44.0

43.9

% of Firm Assets

1.1%

1.2%

1.2%

0.8%

0.6%

0.5%

0.4%

0.4%

1.6%

1.9%

51.0%

45.1%

50.0% $ 2,534

$ 2,544

$ 2,822

$ 2,852

$ 2,757

$ 2,292

Fixed Income

% Carve Out** CCM Assets under Management (Millions)

$

1,997 $

1,719 $

2,139 $

2,331

* Equal weighted standard deviation of annual return of accounts in composite for the full year. **Carve Outs are disallowed by GIPS® after 2010 unless cash for the carve out is managed separately.

COMPOSITE DESCRIPTIONS Composite

Description

Benchmark

Core Balanced Wrap

CCM wrap fee accounts that employ a Core Balanced or Core Balanced Plus strategy with >$100,000 market value as of the start of the quarter. The fixed income allocation must be all taxable bonds.

50% S&P 500 / 50% Barclays Govt/Credit

Moderate Risk Wrap

CCM wrap fee accounts that employ a Moderate Risk strategy with >$100,000 market value as of the start of the quarter. The fixed income allocation must be all taxable bonds.

40% S&P 500 / 40% Barclays Govt/Credit / 20% US T-Bills

Low Risk Wrap

CCM wrap fee accounts that employ a Low Risk strategy with >$100,000 market value as of the start of the quarter. The fixed income allocation must be all taxable bonds.

20% S&P 500 / 40% Barclays Govt/Credit / 40% US T-Bills

Equity Wrap

CCM wrap fee accounts that employ an all equity strategy with >$100,000 market value as of the start of the quarter. CCM’s equity strategy is relative value. We hold domestic and ADR’s in the small mid and large cap valuation sectors.

S&P 500

Fixed Income Wrap

CCM wrap fee accounts that employ an all fixed strategy with >$100,000 market value as of the start of the quarter. Bonds may be taxable or tax-free.

Barclays Govt/Credit


CCM Investment Advisers' Fact Sheet