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1 JEFFREY C. PAULIS, CFA Principal, Senior Portfolio Manager CLIENT NAME GOES HERE A DIFFERENTIATED APPROACH TO SMALL CAP INVESTING City of Ocala General Employees' Retirement System May 8, 2017

2 AN INTRODUCTION TO SBH SBH AT-A-GLANCE As of March 31, 2017 PROVEN INVESTMENT MANAGEMENT EXPERTISE SBH is an independently managed investment firm founded in 1994 Our ownership consists of 20 employee Principals and a strong financial partner in Thoma Bravo, LLC Our partnership culture results in a high degree of continuity among our investment teams and lasting client relationships SBH offers a diversified mix of investment strategies, including domestic and international equities, fixed income and customized solutions 2

3 INVESTMENT PHILOSOPHY & PROCESS INVESTMENT PHILOSOPHY SBH relies on its in-depth proprietary research to uncover investments that have the potential to offer consistent returns over the long term and downside protection through market cycles. Our experienced small cap equity investment team conducts bottom-up research, looking for management teams that are focused on sustainable and/or improving return on invested capital (ROIC). These efficient allocators of capital typically service niche markets, have low embedded expectations and defendable competitive advantages. We believe this approach is applicable to all of our small cap strategies. 3

4 ACCOUNT RECONCILIATION AND PERFORMANCE City of Ocala General Employees' Retirement System Since Inception Value at June 1, 2011 (with accrued income): $ 15,359,775 Net Cashflows: ($ 13,030,501) Adjusted Value: $ 2,329,274 Value at March 31, 2017 (with accrued income): $ 9,339,920 Net Change in Value: $ 7,010,646 1Q17 1 Year 3 Years 5 Years Since Inception (6/1/11 3/31/17) City of Ocala Gross City of Ocala Net Russell 2000 Index (Partial Year) City of Ocala Gross City of Ocala Net Russell 2000 Index Please note: All data more than 1 year is Annualized 4

5 1Q17 PERFORMANCE ATTRIBUTION VS. RUSSELL 2000 Small Cap Model Russell 2000 Attribution Analysis Port. Port. Port. Bench. Bench. Bench. Average Total Contrib. Average Total Contrib. AllocationSelection Total Custom Sector Weight Return To Return Weight Return To Return Effect Effect Effect Total Consumer Discretionary Financials Industrials Consumer Staples Health Care Materials Real Estate Telecommunication Services [Unassigned] Energy Utilities [Cash] Information Technology

6 SMALL CAP 1Q17 MARKET COMMENTARY The SBH Small Cap Core strategy returned 3.8% during the first quarter of 2017, compared to a return of 2.5% for the Russell 2000 Index. The strategy s overweight in Healthcare and underweight in Financials (banks), which was a headwind in the fourth quarter of 2016 in the wake of post-election euphoria, benefited the strategy during the first quarter of Outperformance during the quarter was also driven by stock selection in the Consumer Discretionary and Industrial sectors, which was partially offset by weak selection in the Technology sector. We did use the strength in Healthcare during the quarter to scale back on some positions with less attractive rewardto-risk ratios. Likewise, we used the weakness in the Financials sector to add new positions. Following a prolonged period of below-normal contribution from buyouts, the strategy benefited from several acquisition proposals and takeout rumors during the quarter. Popeyes Louisiana Kitchen Inc. (PLKI) and DigitalGlobe Inc. (DGI) both received buyout offers during the quarter, while Kate Spade & Co. (KATE) has been a rumored target of both Coach and Michael Kors. All three names contributed to outperformance during the quarter. Over the medium and long term, buyout activity has been a solid contributor to outperformance of the Small Cap Core strategy. We are pleased that 2017 has started so strongly on this front after a below-normal amount of acquisition benefit during the last several years. Further, the momentum has continued in the second quarter of 2017, as Panera Bread Co. (PNRA) also announced in early April that it would be acquired. PLKI, a quick-service restaurant chain, was the largest contributor during the quarter as the company was acquired by Restaurant Brands International Inc. (QSR). PTC Inc., a software design company, was the second-largest contributor to performance as the company reported another solid quarter and as the successful business model transition to subscription from license continues. PNRA, a fast casual restaurant operator, was another very strong contributor in the quarter, even prior to it receiving a buyout offer in early April, on the heels of continued traction in using technology to generate store traffic and rolling out delivery to its store base. On the other hand, Xperi Corporation (XPER) and ServiceSource International Inc. (SREV) were the two largest detractors in the quarter. XPER, a technology licensing company, declined after the company disclosed it had entered the re-negotiation process with a large customer that licenses its semiconductor packaging technology, leading to some uncertainty. We believe this is simply normal course of business in the licensing industry. We had been reducing our position through the quarter based on a less attractive reward/risk ratio and have been adding back to the position on the selloff. SREV experienced a higher level of churn within its customer base, which forced the company to issue disappointing guidance for During the first quarter of 2017, the underlying dynamics in the market that powered the post-election appreciation partially reversed. Financials (banks), other cyclicals and the Value style in general gave back some of the significant 4Q16 outperformance, while areas like Technology, Healthcare and Growth in general, which were massive underperformers following the election, began outperforming again. The pivot back towards more defensive positioning happened at a time when various economic data points ISM, economic Continued on next page 6

7 SMALL CAP 1Q17 MARKET COMMENTARY CONT D surprise indexes, business sentiment indexes, etc. were spiking to positive levels not experienced in quite some time. Further, the trajectory of corporate earnings revisions downward during the first quarter was also lower than we have experienced in several years. As a result, we believe that we are on the cusp of positive news from an earnings perspective. Merger and acquisition activity remains quite healthy as well. On the other hand, there are also some negative signs. The Russell 2000 Index price/earnings ratio (P/E) stands in the 95 th percentile 1, inflation is rising, the U.S. Federal Reserve (Fed) is raising rates, the yield curve has flattened of late, the yield on 10-year Treasury Notes is back below 2.4%, global and domestic political uncertainty remains high, and the economic indicators referenced above all appear to be peaking in the near term. Putting it all together, there remain several positive and negative forces in the market environment. At a minimum, we believe the multitude of forces at work could begin to drive a higher level of volatility than we have seen in some time. Volatility has historically provided a solid backdrop for the SBH Small Cap Core strategy, with the strategy outperforming solidly over the time period, when volatility was above long-term averages. While we are not suggesting an imminent return to that level of volatility, when market gyrations do increase, we believe that the SBH Small Cap Core strategy s emphasis on niche market companies, Return on Invested Capital (ROIC) and strong management teams has the potential to shine. However, regardless if volatility increases or decreases or the market provides us with headwinds or tailwinds, we remain steadfast in our approach that aims to ensure that we invest in companies that are implementing operating and strategic plans that ultimately differentiate them from peers while also allocating their capital in value-maximizing ways with the goal of generating long-term value and outperformance. Thank you for your interest and support, Mark T. Dickherber, CFA, CPA Jeffrey C. Paulis, CFA 1 Source: Jeffries 7

8 SWINGS INSIDE OF SMALL CAPS REMAIN MUTED (As of 3/16/17) AVERAGE DIFFERENCE BETWEEN INTRADAY HIGH AND LOW ON RUSSELL 2000 INDEX Avg. 1.5% Sources: FactSet, Russell Investment Group 8

9 SBH Small Cap Core SBH Small Cap Core SBH Small Cap Core SBH Small Cap Core SBH SMALL CAP PLATFORM (As of 12/31/16) SBH SMALL CAP CORE: LONG-TERM TRACK RECORD Rolling 3-Year Returns Rolling 5-Year Returns 65% 85% Russell 2000 Rolling 7-Year Returns 35% Russell 2000 Rolling 10-Year Returns 15% 97% 100% Russell % Russell % * Returns are gross of fees. Historical performance cannot guarantee future results. See specific performance disclosure pages at the end of the presentation. Source: evestment 9

10 Percent Return SBH SMALL CAP PLATFORM SMALL CAP CORE: PERFORMANCE SUMMARY* Annualized Returns 30% SBH Russell % 10% 0% -10% 1Q17 1 Year 3 Years 5 Years 10 Years SI** SBH 3.76% 18.60% 5.37% 10.85% 9.65% 11.20% Russell % 26.22% 7.22% 12.35% 7.12% 8.51% * Preliminary. As of 3/31/17; Periods greater than one year are annualized. Performance is gross of fees. Historical performance cannot guarantee future results. See specific performance disclosure pages at the end of the presentation. **As of 01/01/

11 RISK MITIGATION VALUATION Seek 3:1 upside to downside ratio at initiation Scenario and sensitivity analysis Match position size with fundamental conviction DIVERSIFICATION 70 to 85 positions (strategy dependent) diversified across industries Sector weights 0 to +125% versus benchmark Maximum 5% in any one security ONGOING REVIEWS Quarterly review of investment theses and relative valuations Continual review of improvements or declines in Dashboard SELLS CAN BE TRIGGERED BY: Change in underlying fundamentals/investment thesis, including change in key executives, culture or financial philosophy Security reaches intrinsic valuation More attractive replacement security identified 11

12 SBH SMALL CAP PLATFORM SMALL CAP CORE: REPRESENTATIVE ACCOUNT CONSTRUCTION * Consumer Discretionary Consumer Staples Energy Financials Health Care Industrials Information Technology Materials Real Estate Telecommunication Services Sector Allocation Top 10 Holdings 1 SBH Company Percent of total PTC Inc. 4.0% Alere Inc. 3.4% Bio-Techne Corporation 3.2% Orthofix International NV 2.6% Bemis Company, Inc. 2.5% FLIR Systems, Inc. 2.5% Innophos Holdings, Inc. 2.3% AZZ Inc. 2.2% ESCO Technologies Inc. 2.1% Insulet Corporation 2.0% Russell 2000 ANALYST COVERAGE: Mark Dickherber, CFA, CPA Healthcare, Utilities Utilities Jeff Paulis, CFA Industrials Shaun P. Nicholson Energy, Financials, Industrials, Materials 0% 5% 10% 15% 20% 25% Zachary Rosenstock, CFA Information Technology Eric Hines, CFA Consumer Staples, Consumer Discretionary * As of 3/31/17; This information is supplemental to the fully compliant presentation. 1 SOURCE: FactSet; Top ten holdings are reported based on the market value of individual positions in the portfolio. Holdings are subject to change, vary over time and should not be considered a recommendation to buy or sell. It should not be assumed that future holdings will be profitable or equal the performance of these holdings. 12

13 SBH SMALL CAP PLATFORM SMALL CAP CORE: REPRESENTATIVE ACCOUNT STATISTICS * VALUATION MEASURES Small Cap Russell 2000 Projected Price/Earnings (12 months) 18.9x 16.3x Price / Cash Flow 16.1x 12.5x PROFITABILITY MEASURES Return on Investment 15.5% 7.8% Projected Growth (12 months) 10.4% 8.2% PORTFOLIO CHARACTERISTICS Weighted Average Market Cap ($mil) $3,052 $2,374 Median Market Cap ($mil) $2,532 $793 Dividend Yield 0.8% 1.3% Number of Holdings 80 1,946 Market Cap SBH # Holdings SBH % Portfolio Russell 2000 Greater than $3 billion 32 48% 25% $500 million - $3 billion 44 49% 66% Less than $500 million 4 3% 8% Total Holdings % 100% * As of 3/31/17; This information is supplemental to the fully compliant presentation. Historical performance cannot guarantee future results. See specific performance disclosure pages at the end of the presentation. SOURCE: Factset 13

14 APPENDIX PORTFOLIO MANAGEMENT TEAM Mark T. Dickherber, CFA, CPA Principal, Senior Portfolio Manager Jeffrey C. Paulis, CFA Principal, Senior Portfolio Manager Shaun P. Nicholson Senior Portfolio Manager Mark Dickherber is a Principal, Senior Portfolio Manager and Head of Segall Bryant & Hamill's Small Cap strategies. He is the lead Portfolio Manager for our Small Cap Core and Small Cap Value strategies and the Co-Portfolio Manager for our Small Cap Value Concentrated strategy. He is also responsible for equity research in the Small Cap and Small/Mid Core equity portfolios. Mr. Dickherber is a specialist in the healthcare sector. Prior to joining SBH, Mr. Dickherber served as Director of Research for Kennedy Capital Management, where he had worked since Mr. Dickherber graduated magna cum laude from the University of Missouri-St. Louis with a B.S. in Accounting. He served as Treasurer for the CFA Society of St. Louis from and as a Director from Mr. Dickherber has been in the investment industry since 1996 and has earned Chartered Financial Analyst (CFA) and Certified Public Accountant (CPA) designations. Jeff Paulis is a Senior Portfolio Manager for Segall Bryant & Hamill's Small Cap strategies. He is the lead Portfolio Manager for our SMID Cap strategy and the Co-Portfolio Manager for our Small Cap Core strategy. Mr. Paulis is also responsible for equity research within the consumer discretionary and industrial sectors for the SBH Small Cap and SBH Small Cap Value portfolios. Prior to joining SBH in 2003, his professional experience included serving as a Research Analyst at McDonald Investments. Prior to joining McDonald Investments, he served as an intern at Kennedy Capital Management. He is a graduate of Saint Louis University with a B.S. in Business Administration and holds an MBA from the University of Chicago s Booth School of Business. Mr. Paulis has been in the investment industry since 2001 and has earned the Chartered Financial Analyst (CFA) designation. Shaun Nicholson is a Senior Portfolio Manager for Segall Bryant & Hamill's Small Cap strategies. He is the lead Portfolio Manager for our Small Cap Value Concentrated strategy and the Co-Portfolio Manager for our Small Cap Value strategy. Mr. Nicholson is responsible for research related to materials, autos/transports, industrials, regional banks and energy within the respective portfolios. He joined SBH in 2011 after having spent more than six years at Kennedy Capital Management. Prior to Kennedy, Mr. Nicholson's experience was as an Associate Portfolio Manager at U.S. Bancorp Asset Management and as a Financial Analyst at The Boeing Company. Mr. Nicholson earned a B.S. from Seton Hall University and earned an MBA from the University of Missouri-St. Louis. He has been in the investment industry since

15 APPENDIX PORTFOLIO MANAGEMENT TEAM Zachary T. Rosenstock, CFA Senior Equity Analyst Zach Rosenstock is a Senior Equity Analyst for Segall Bryant & Hamill's Small Cap Equity strategies. Mr. Rosenstock is responsible for technology related research within the respective strategies. His professional experience includes serving as a Research Analyst at Great Lakes Advisors. He is a graduate of Boston College with a B.A. in Economics. Mr. Rosenstock has been in the investment industry since 2005 and has earned the Chartered Financial Analyst (CFA) designation. Eric D. Hines, CFA Equity Analyst Eric Hines is an Equity Analyst for Segall Bryant & Hamill's Small Cap Equity strategies. Mr. Hines is responsible for consumer related research within the respective strategies. His professional experience includes serving as both an Account Executive and Consultant at FactSet Research Systems. Prior to joining FactSet, he served as an intern at Kennedy Capital Management. He is a graduate of Saint Louis University with a B.S. in Business Administration. Mr. Hines has been in the investment industry since 2007 and has earned the Chartered Financial Analyst (CFA) designation. Elisa Brizuela Equity Trader Elisa Brizuela is an Equity Trader for Segall Bryant & Hamill. Ms. Brizuela is responsible for Segall Bryant & Hamill's Small Cap Equity trading, as well as assisting institutional equity trading. Prior to joining the firm, she was an International Equity Trader at Driehaus Capital Management and William Blair Asset Management. She has been in the investment industry since

16 SMALL CAP CORE COMPOSITE PERFORMANCE (1) Presented as supplemental information to the fully compliant presentation. Segall Bryant & Hamill is a Registered Investment Adviser, established in SBH provides fee-based management of fixed income and equity portfolios for institutional clients and high net worth individuals. The Small Cap Equity composite was created in January, The Small Cap Equity composite is an equity strategy consisting of companies with a market capitalization that typically does not exceed the largest market capitalization company in the Russell 2000 Index. Accordingly, the composite is benchmarked against the Russell 2000 Index. The Russell 2000 index is a subset of the Russell 3000 and measures the performance of the 2000 smallest companies. These companies generally have a weighted average market value of $2.4 billion. The Small Cap Equity composite is comprised of all fee paying, discretionary accounts managed to this investment approach which have assets greater than $1 million and one month of returns. Accounts falling below the $1 million threshold are not eligible for inclusion in the composite. In addition, accounts that have a significant cash flow, defined as 25% of the market value, will be removed from the composite until the next reconciliation and calculation period. Gross results are shown net of trading costs and include the reinvestment of all dividends and interest. Net results are shown net of management fees as well as trading costs and include the reinvestment of all dividends and interest. Net results reflect actual fees paid. The current fee schedule applicable to the Small Cap Equity accounts is 1% on all amounts. Actual fees will vary. All information is based on US dollar values. Returns are calculated on a capitalization and time weighted basis and linked quarterly. Dispersion of returns is measured by an equal weighted standard deviation of all the accounts in the composite for a full year period. Neither the composite nor the benchmark returns reflect the withholding of any taxes for ordinary income or capital gains. Segall Bryant & Hamill claims compliance with the Global Investment Performance Standards (GIPS ) and has prepared and presented this report in compliance with the GIPS standards. Segall Bryant & Hamill has been independently verified for the periods January 1, 2000 through December 31, The verification report 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. A complete list and description of the firm's composites, as well as additional information regarding policies for valuing portfolios, calculating returns and preparing compliant presentations, is available upon request from SBH. Performance information shown prior to 2002 is supplemental. Revised April