February 2, 2011

Presenters from Public Financial Management, Inc.

John H. Bonow Todd FraizerManaging Director Managing Directorbonowj@pfm.com fraizert@pfm.com

Debt 2: Planning and Bond Sales: Accessing The Debt Market

MARKETING AND PRICING

Oakland, California

C D I A C

C D I A COverview

2

Method of Sale Alternatives How bonds from various sectors are priced Pricing Data, Essential Market Information and the

Pricing Process Understanding Investors and the Unique Perceptions

of Each Credit in a Post-Bond Insurance World Market Access Challenges and Related Considerations Techniques to Access the Markets to Best Satisfy

Financing Objectives

C D I A CMarketing a Fixed Rate Bond Issue

3

Methods of Selling Bonds Competitive Negotiated Hybrid Competitive

Negotiated for Retail-Only Order Period Competitive sale for unsold balances

Private Placement

C D I A CHow Bonds are Competitively Sold

4

Issuer and financial advisor structure the bond issue and take bids from syndicates of investment banks.

Underwriters bid interest rates by maturity and a total purchase price to determine the lowest True Interest Cost (“TIC”).

Winning bidder then sells the bonds, often with a markup, to retail and institutional investors. Generally used for General Obligation (G.O.) bond sales,

enterprise fund revenue bonds, and strong credits

C D I A CCompetitive Sales – The Process Effective outreach to the

universe of potential bidders increases the number and quality of bids

Knowledge of investor preferences results in a “friendly” structure and bidding parameters

5

COMPETITIVE SALE

Create Notice of Sale

Issuer & Financial Advisor pre-market the SALE to underwriters

Underwriters work-up & submit bids

Issuer & Financial Advisor evaluate & accept lowest conforming bid (TIC)

C D I A CHow a Negotiated Sale Works Bonds are sold to one investment banking syndicate. Interest rates and the purchase price result from

negotiations between the issuer/financial advisor and the underwriter.

The investment banking syndicate pre-markets the bonds to retail and institutional investors.

Investors submit orders and the investment bank offers to underwrite (purchase) the entire bond issue. Generally used for large, complex or weak credits. Most common type of bond sale method for health care

and higher education transactions.

6

C D I A CNegotiated Pricings – The Process

Where does the Issuer acquire the knowledge to negotiate the best outcome (the lowest, risk-adjusted cost of capital)?

More on that later…

7

NEGOTIATED SALE

Issuer hires underwriting syndicate

Syndicate pre-markets BONDS

Issuer, Financial Advisor & Senior Underwriter negotiate pricing scale

(Pre-pricing call)

Pricing wire released & bonds offered directly to investors

Underwriting syndicate takes orders

Final price negotiated (Pricing call)

C D I A CHow a Hybrid Competitive Sale Works An investment banking syndicate and a selling group

take orders from retail investors over one/more days. Interest rates and purchase terms are negotiated for the

bonds sold to retail. Remaining/unsold bond balances are then sold via a

competitive sale (usually the following day). Underwriters bid for the remaining bonds. Maximizes access to retail investors. Preserves competitive sale benefits.

8

C D I A CHow a Private Placement Works Bonds are purchased by a Bank or another qualified

investor but are not typically resold to the general public (e.g., retail investors).

Interest rates and the purchase price result from direct negotiations between the issuer/financial advisor and the purchaser. An investment bank may not be used.

Generally used for weak or very complex credits

9

C D I A CChoices when Selling Bonds Can the same financing goals be accomplished with any method

of sale/placement?

10

Selecting a Method of Placement

CONSIDERATION COMPETITIVE NEGOTIATEDPRIVATE

PLACEMENT

Complex terms and structure

Low to moderate High All

Volatile marketDepends

(Supply driven?)

Useful

(Market timing)Varies

Size (par amount) of issue

Very large issues may shrink bidder list

No functional upper limit

Investor-driven limitations

Issuer Credit Rating

Minimum investment grade (> BBB-/Baa3)

AllAll (may be better with weak credits)

Investor awareness & familiarity

Depends on the ability to reach and educate investors

Issuer knowledge Each method can be EQUALLY effective

C D I A CCompetitive vs. Negotiated

11

C D I A CPricing Bonds from Different Sectors

12

All Bonds are not created equal (even those with identical credit ratings) Municipal

General Obligation Bonds Essential Service Revenue Bonds

Utilities and Special Purpose Districts Water, Wastewater, Electric, Stormwater, etc.

Private, 501(c)3 Borrowers Health Care Higher Education

Industrial Development, Land-Secured, RDAs

C D I A CSector Differences with the Same Ratings

13

Investors perceive different levels of risk between sectors.

General ratings-driven yield indications are inadequate indicators of pricing levels.

Comparable issue analysis and trade data will help develop an informed pricing opinion.

C D I A CEssential Pricing Information Elements

14

General market conditions Interest rates Supply Secondary market activity (net buying/selling)

Sector-specific conditions (e.g., health care, RDAs, assessment districts)

Pricing performance of comparable transactions (rating, sector, size, state)

Prior issuer-specific pricing results (primary market) Recent secondary market trades for the issuer Does the issuer have access to this information?

C D I A CMunicipal Market: Supply/Demand Impact

Overall supply & demand factors still drive the market

Low supply levels combined with consistent demand pushed rates lower throughout the summer of 2010

Credit spreads tightened as investors ventured out the credit curve in search of yield throughout the summer of 2010

Last quarter of 2010, supply-demand dynamics shifted, putting upward pressure on rates and spreads through year-end

Sustained heavy supply calendar through December 2010

Reduction in demand with large mutual fund outflows since November

15

$0

$2

$4

$6

$8

$10

$12

$14

$16

Billi

ons

SupplyTaxableTax-ExemptTotal

2.0%2.2%2.4%2.6%2.8%3.0%3.2%3.4%3.6%3.8%4.0%

50 55 60 65 70 75 80 85 90 95

100

Yield

Spre

ad t

o M

MD

in

bps

Rate and Spread MovementA GO 10 yr SpreadMMD 10 yr

($14)

($12)

($10)

($8)

($6)

($4)

($2)

$0

$2

$4

$6

Billi

ons

Demand

Inflows (Outflows)

Inflows (Outflows) Trendline

C D I A CDemand – Mass Exodus from Munis

($15)

($10)

($5)

$0

$5

$10

$15

1/1/07 7/1/07 1/1/08 7/1/08 1/1/09 7/1/09 1/1/10 7/1/10 1/1/11

Billi

ons

2007-2010 Monthly Mutual Fund Inflows (Outflows)

Since November 1st, the municipal market has seen $30B flow out of mutual funds

The municipal market saw net inflows of $32B in the first ten months, but gave nearly all of it back in just ten weeks $5

$10

$14 $15$17

$19

$23

$28$30

$32

$25

$12

$2

$0

$5

$10

$15

$20

$25

$30

$35

1/1 2/1 3/1 4/1 5/1 6/1 7/1 8/1 9/1 10/1 11/1 12/1 1/1

Billi

ons

Cumulative Inflows (Outflows) since 2010

16

C D I A CRecent Market Rate Movement

Dramatic movement in rates from November 1st through end of the year Supply/demand dynamics have put upward pressure on rates Unrelenting media attack and political rhetoric

17

Late 2010 / Early 2011 AAA MMD Rate Movement

718

36

54 5865

7282 84

90 94 98 102108

114122 127 129 131 133 134 133 133 130 127 124 123 123 122 122

-

+ 25

+ 50

+ 75

+ 100

+ 125

+ 150

+ 175

+ 200

+ 225

+ 250

+ 275

0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

3.00%

3.50%

4.00%

4.50%

5.00%

5.50%

(In

crea

se in

Bas

is P

oin

ts)

Change in MMD (11/1 - 1/14) 11/1/2010 MMD 12/1/2010 MMD 1/1/2011 MMD 1/14/2011 MMD

Source: Bloomberg & TM3

C D I A CRecent Market Rate Movement

18

Mid-Late January AAA MMD Rate Reversal

Low supply has helped keep rates in check

Recent relative-value (“cross-over”) buyers have helped reverse course

0

1

0 0

2

57

9 10 1012 13 14 15 16

18

2123

26

30 3129 28

26 26 25 26 26 26 26

- 35

- 30

- 25

- 20

- 15

- 10

- 5

-

+ 5

+ 10

+ 15

+ 20

0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

3.00%

3.50%

4.00%

4.50%

5.00%

5.50%

(In

crea

se in

Bas

is P

oin

ts)

Change in MMD (since 1/14) 1/14/2011 MMD 1/26/2011 MMD

Source: Bloomberg & TM3

C D I A C

14

4352

11289

206

0

50

100

150

200

250

300

350

400

Basi

s Po

ints

Aa/AA A/A Baa/BBB

Credit Uncertainty Persists

Source: TM3 * 10 Year Maturity

Credit Spread Movement (since 2008)

Low yields on high-grades pushed investors out the credit curve in search of yield throughout 2010

2010 year-end saw a small spike in credit spreads at the end of 2010

19

C D I A CIssuer-specific Secondary Market Trades

20

Issuers can look at the trading performance of prior bond issues to assess demand and yield ranges.

(40)

(20)

0

20

40

60

80

100

July

Aug

ust

Sept

embe

r

Oct

ober

Nov

embe

r

Wei

ghte

d Ave

rage

Spr

ead

to M

MD

(Bas

is P

oint

s)

Sound Transit Tax-Exempt, Uninsured Bonds:Secondary Market Trades,

July -November 2010

2007A - 2034 2007A - 2036 2009P-1 - 2015 2009P-1 - 2016A 2009P-1 - 2016B

Secondary Market Trading Activity for Select Parity Maturities from the

Same Issuer

C D I A CCredit Analysis has Changed

21

Prior to 2008 municipal credit analysis was often homogenized Bond Insurance used for a majority of transactions Underlying bond ratings were not emphasized Credit analysis varied by investor

The loss of bond insurance has put a strong focus on credit/risk analysis Rating agencies are hyper-aware of their conclusions Investors undertake their own credit review Issues with the same credit ratings are differentiated

(example) Aa3 rating health care ≠ Aa3 general obligation

C D I A COutreach to Investors is Important

22

Securing Investment Grade Ratings does not Ensure a Good Pricing Result Skepticism about the “accuracy” of credit ratings Press releases add to herd mentalities

“Companies are in trouble!” = buy munis or treasuries “Municipal defaults will expand!” = buy stocks

Develop an investor relations program for each credit Find out who typically owns your kind of bond and who

actually owns your bonds Expand the demand base for your credit

C D I A CKnow Who Owns Your Bonds (and Why)

Bondholder's Report

Firm Name USD Par (000)

USD Net Change (000)

Series Held

1 Vanguard Group Inc, The 4,022 0 42 Prime Advisors Inc 3,512 0 73 Southern Farm Bureau Casualty Insurance Co 3,445 0 24 Columbia Management Investment Advisers LLC 3,240 0 25 New Jersey Manufacturers Insurance Co 3,170 0 26 Conning Asset Management Co 2,846 0 67 United Farm Family Life Insurance Co 2,525 0 28 Texas Farm Bureau Insurance Companies 1,730 0 29 Nationwide Insurance Co (Office of Investments) 1,545 0 110 Island Insurance Co Ltd 1,540 0 111 Country Trust Bank 1,290 0 112 Deutsche Asset Management (DeAM) (NYC) 1,218 -541 313 General Re-New England Asset Management Inc 1,214 815 314 State Street Global Advisors (SSgA) 1,187 0 215 AEW Capital Management LP 1,080 0 416 Grinnell Mutual Reinsurance Co 1,000 0 117 EquiTrust Investment Management Services Inc 1,000 0 118 Wellington Management Co LLP 882 0 419 GE Asset Management Inc 815 815 120 Asset Allocation & Management Co LLC (AAM) 803 0 2

Concentration among a few investors is not unusual Creates opportunities to

find an investors in times of market difficulty

Helps focus the effort to broaden demand

Comparison of actual holders to “typical” holders is important Why does not investor X

own MY bonds?23

C D I A CMarket Access Challenges

24

Industry-wide threats of default International unrest Net selling among mutual bond funds Fear on behalf of retail investors Federal and state budget uncertainty Persistent confusion on the direction of inflation Sector-specific concerns

Redevelopment Agency revenue, health care reform, water supply, etc.

C D I A CAccessing the Markets to Satisfy Financing Objectives

25

Be clear on financing objectives Minimum proceeds goal? Cost of capital target?

Determine flexibility in the plan of finance Are long amortizations essential? Can short-term maturities be managed?

What investors are buying and what are they buying? Consistent with objectives, tailor the offering to what

investors want/demand.

C D I A C

Nuts and Bolts of a Negotiated SaleNuts and Bolts of a Negotiated Sale

C D I A CUnderwriting Spread Components

27

C D I A CPriority of Orders

28

C D I A COrder Period(s)

29

C D I A CPrice Talk

30

C D I A CPricing Lingo

a. Bump To add a basis point in price

b. Cut To subtract a basis point in price

c. 5 handle 5%-5.99% coupon (interest rate)

d. Blocks Size of maturity or order

e. Going away order Order to a “buy and hold” investor

f. Tighten Lower the yields

g. Loosen Raise the yields

h. Nickel 5 basis points

i. Sloppy Prices are too cheap

j. Basis point (“bip” or “tick”) 1/100 of 1%(i.e., change 0.05% = a 5 bip adjustment)

31

C D I A CPreliminary Pricing Thoughts – Retail

PRELIMINARY PRICING WIRE

RE: $121,135,000 CEFA/CHFFA

Moody's: A1 S&P: A Fitch: A+

DATED: 6/1/2010 FIRST COUPON: 12/1/2010

DUE: 6/1TAKEDOWN

MATURITY AMOUNT COUPON PRICE ($/1,000)6/1/2011 1,700M 3.000 % 1.360 3.75 6/1/2012 1,750M 3.000 % 1.780 3.75 6/1/2013 1,800M 3.000 % 2.200 5.00 6/1/2014 1,855M 4.000 % 2.650 5.00 6/1/2015 1,930M 4.000 % 3.110 5.00 6/1/2016 2,005M 4.000 % 3.600 5.00 6/1/2017 2,090M 4.500 % 3.890 5.00 6/1/2018 2,180M 4.500 % 4.080 5.00 6/1/2019 2,280M 5.000 % 4.270 5.00 6/1/2020 2,395M 5.000 % 4.420 5.00 6/1/2021 2,515M 5.000 % 4.520 6.25 6/1/2022 2,640M 5.000 % 4.610 6.25 6/1/2023 2,770M 5.000 % 4.690 (APPROX. PTC $ 6/1/2020 100.079) 6.25 6/1/2024 2,910M 5.000 % 4.770 (APPROX. PTC $ 6/1/2020 100.236) 6.25 6/1/2025 3,055M 5.000 % 4.850 6.25 6/1/2026 3,210M 5.500 % 4.950 6.25 6/1/2027 3,385M 5.500 % 5.050 6.25 6/1/2028 3,570M 5.500 % 5.150 6.25 6/1/2029 3,765M 5.500 % 5.250 6.25 6/1/2030 3,975M 5.500 % 5.350 6.25

6/1/2034 18,280M 5.750% 5.560 5.00

6/1/2038 22,765M 5.500% 5.630 (APPROX. PTC $ 6/1/2020 100.151) 7.50

6/1/2042 28,310M 5.750% 5.750 6.25

CALL FEATURES: OPTIONAL CALL IN 06/01/2020 @ 100.000 32

C D I A CRetail Orders

Syndicate and selling group members supported the shorter maturities in the transaction.

To focus potential demand, only one term bond was offered to retail.

Note: adjusting for oversubscriptions, $100.135M of bonds (before adjustments) are left after the retail-only order period.

Total Retail RetailAmount Retail Priority Member Balance

Maturity Coupon ($000's) ($000's) ($000's) ($000's) ($000's)6/1/2011 1.500 % 1,700 1,700 1,700 - 06/1/2012 1.800 % 1,750 2,000 750 1,250 (250)6/1/2013 2.200 % 1,800 3,000 800 2,200 (1,200)6/1/2014 2.650 % 1,855 3,500 855 2,645 (1,645)6/1/2015 3.100 % 1,930 2,000 1,430 570 (70)6/1/2016 3.600 % 2,005 2,250 1,505 745 (245)6/1/2017 3.900 % 2,090 770 770 - 1,3206/1/2018 4.100 % 2,180 180 180 - 2,0006/1/2019 4.250 % 2,280 460 460 - 1,8206/1/2020 4.400 % 2,395 220 220 - 2,1756/1/2021 4.500 % 2,515 890 890 - 1,6256/1/2022 4.600 % 2,640 4,800 2,000 2,800 (2,160)6/1/2023 4.700 % 2,770 - 2,7706/1/2024 4.800 % 2,910 - 2,9106/1/2025 4.850 % 3,055 - 3,0556/1/2026 4.950 % 3,210 - 3,2106/1/2027 5.050 % 3,385 - 3,3856/1/2028 5.150 % 3,570 - 3,5706/1/2029 5.250 % 3,765 - 3,7656/1/2030 5.350 % 3,975 - 3,975

6/1/2034 5.750 % 18,280 NOT OFFERED TO RETAIL 18,280

6/1/2038 5.650 % 22,765 4,800 3,800 1,000 17,965

6/1/2042 5.750 % 28,310 NOT OFFERED TO RETAIL 28,310

TOTAL 121,135 26,570 15,360 11,210 100,135

33

C D I A C(Initial) Preliminary Pricing Wire – Institutional

Underwriter desires to avoid risk and proposes to “term up” the longer-dated Serial bonds.

Maturities with some retail demand but remaining par have been “bifurcated.” Coupon structure reflects

institutional investor desires (e.g., premium)

Takedowns have been lowered to institutional levels.

(INITIAL) PRELIMINARY PRICING WIRE - INSTITUTIONAL ORDER PERIOD

RE: $121,585,000 CEFA/CHFFA

Moody's: A1 S&P: A Fitch: A+

DATED: 6/1/2010 FIRST COUPON: 12/1/2010

DUE: 6/1TAKEDOWN

MATURITY AMOUNT COUPON PRICE ($/1,000)6/1/2011 NMO 1.500 % 1.3606/1/2012 NMO 1.800 % 1.7806/1/2013 NMO 2.200 % 2.2006/1/2014 NMO 2.650 % 2.6506/1/2015 NMO 3.100 % 3.1106/1/2016 NMO 3.600 % 3.6006/1/2017 NMO 3.900 % 3.8906/1/2017 1,345M 4.500 % 3.890 5.00 6/1/2018 NMO 4.100 % 4.0806/1/2018 2,025M 4.500 % 4.080 5.00 6/1/2019 NMO 4.250 % 4.2706/1/2019 1,845M 5.000 % 4.270 5.00 6/1/2020 NMO 4.400 % 4.4206/1/2020 2,195M 5.000 % 4.420 5.00 6/1/2021 NMO 4.500 % 4.5206/1/2021 1,645M 5.000 % 4.520 (APPROX. PTC $ 6/1/2020 103.827) 5.00 6/1/2022 NMO 4.600 % 4.6106/1/2023 2,780M 5.000 % 4.690 (APPROX. PTC $ 6/1/2020 102.452) 5.00 6/1/2024 2,920M 5.000 % 4.770 (APPROX. PTC $ 6/1/2020 101.812) 5.00 6/1/2025 3,065M 5.000 % 4.850 (APPROX. PTC $ 6/1/2020 101.177) 5.00

6/1/2030 17,960M 5.500 % 5.350 (APPROX. PTC $ 6/1/2020 101.150) 5.00

6/1/2034 18,330M 5.750% 5.560 (APPROX. PTC $ 6/1/2020 101.442) 5.00

6/1/2038 NMO 5.650% 5.630 (APPROX. PTC $ 6/1/2020 100.151)6/1/2038 18,040M 5.500% 5.630 (Dollar Price 98.178) 5.00

6/1/2042 28,435M 5.750% 5.750 5.00

CALL FEATURES: OPTIONAL CALL IN 06/01/2020 @ 100.000

34

C D I A C(Revised) Preliminary Pricing Wire – Institutional

PRELIMINARY PRICING WIRE - INSTITUTIONAL ORDER PERIOD

RE: $121,585,000 CEFA/CHFFA

Moody's: A1 S&P: A Fitch: A+

DATED: 6/1/2010 FIRST COUPON: 12/1/2010

DUE: 6/1TAKEDOWN

MATURITY AMOUNT COUPON PRICE ($/1,000)6/1/2011 NMO 1.500 % 1.3606/1/2012 NMO 1.800 % 1.7806/1/2013 NMO 2.200 % 2.2006/1/2014 NMO 2.650 % 2.6506/1/2015 NMO 3.100 % 3.1106/1/2016 NMO 3.600 % 3.6006/1/2017 NMO 3.900 % 3.8906/1/2017 1,345M 4.500 % 3.890 5.00 6/1/2018 NMO 4.100 % 4.0806/1/2018 2,025M 4.500 % 4.080 5.00 6/1/2019 NMO 4.250 % 4.2706/1/2019 1,845M 5.000 % 4.270 5.00 6/1/2020 NMO 4.400 % 4.4206/1/2020 2,195M 5.000 % 4.420 5.00 6/1/2021 NMO 4.500 % 4.5206/1/2021 1,645M 5.000 % 4.520 (APPROX. PTC $ 6/1/2020 103.827) 5.00 6/1/2022 NMO 4.600 % 4.6106/1/2023 2,780M 5.000 % 4.690 (APPROX. PTC $ 6/1/2020 102.452) 5.00 6/1/2024 2,920M 5.000 % 4.770 (APPROX. PTC $ 6/1/2020 101.812) 5.00 6/1/2025 3,065M 5.000 % 4.850 (APPROX. PTC $ 6/1/2020 101.177) 5.00 6/1/2026 3,220M 5.500 % 4.950 (APPROX. PTC $ 6/1/2020 104.297) 5.00 6/1/2027 3,395M 5.500 % 5.050 (APPROX. PTC $ 6/1/2020 103.499) 5.00 6/1/2028 3,580M 5.500 % 5.150 (APPROX. PTC $ 6/1/2020 102.708) 5.00 6/1/2029 3,780M 5.500 % 5.250 (APPROX. PTC $ 6/1/2020 101.925) 5.00 6/1/2030 3,985M 5.500 % 5.350 (APPROX. PTC $ 6/1/2020 101.150) 5.00

6/1/2034 18,330M 5.750% 5.560 (APPROX. PTC $ 6/1/2020 101.442) 5.00

6/1/2038 NMO 5.650% 5.630 (APPROX. PTC $ 6/1/2020 100.151)6/1/2038 18,040M 5.500% 5.630 (Dollar Price 98.178) 5.00

6/1/2042 28,435M 5.750% 5.750 5.00

CALL FEATURES: OPTIONAL CALL IN 06/01/2020 @ 100.000

Slope of yield curve (e.g., 0.76% from 2023-2030) would result in a higher weighted cost if the 2026-2030 maturities were combined.

Maintaining Serial bonds at original maturities is advocated.

35

C D I A CPrimary (Institutional) Orders

Most maturities were priced well.

Certain maturities (2017 and 2042) saw significant order flow and are the focus of a favorable repricing.

Maintaining the longer serial maturities (with Member support) helped to “ride the yield curve.”

NetTotal Designated Member Subscription Subscription

Amount Retail Orders Orders Balance Priority TotalMaturity Coupon ($000's) ($000's) ($000's) ($000's) ($000's) Orders Orders6/1/2011 1.500 % 1,700 1,700 0 100.0% 100.0%6/1/2012 1.800 % 1,750 2,000 (250) 114.3% 114.3%6/1/2013 2.200 % 1,800 3,000 (1,200) 166.7% 166.7%6/1/2014 2.650 % 1,855 3,500 (1,645) 188.7% 188.7%6/1/2015 3.100 % 1,930 2,000 (70) 103.6% 103.6%6/1/2016 3.600 % 2,005 2,250 (245) 112.2% 112.2%6/1/2017 3.900 % 770 770 0 100.0% 100.0%6/1/2017 4.500 % 1,345 4,500 1,000 (4,155) 334.6% 408.9%6/1/2018 4.100 % 180 180 0 100.0% 100.0%6/1/2018 4.500 % 2,025 4,000 1,000 (2,975) 197.5% 246.9%6/1/2019 4.250 % 460 460 0 100.0% 100.0%6/1/2019 5.000 % 1,845 3,200 (1,355) 173.4% 173.4%6/1/2020 4.400 % 220 220 0 100.0% 100.0%6/1/2020 5.000 % 2,195 3,000 (805) 136.7% 136.7%6/1/2021 4.500 % 890 890 0 100.0% 100.0%6/1/2021 5.000 % 1,645 3,300 (1,655) 200.6% 200.6%6/1/2022 4.600 % 2,640 4,800 (2,160) 181.8% 181.8%6/1/2023 5.000 % 2,780 2,000 780 0 71.9% 100.0%6/1/2024 5.000 % 2,920 2,000 920 0 68.5% 100.0%6/1/2025 5.000 % 3,065 2,000 1,065 0 65.3% 100.0%6/1/2026 5.500 % 3,220 3,220 0 100.0% 100.0%6/1/2027 5.500 % 3,395 3,395 0 100.0% 100.0%6/1/2028 5.500 % 3,580 3,580 0 100.0% 100.0%6/1/2029 5.500 % 3,780 3,780 0 100.0% 100.0%6/1/2030 5.500 % 3,985 3,985 0 100.0% 100.0%

6/1/2034 5.750% 18,330 7,800 10,530 42.6% 42.6%

6/1/2038 5.650% 4,800 4,800 0 100.0% 100.0%6/1/2038 5.500% 18,040 25,000 (6,960) 138.6% 138.6%

6/1/2042 5.750% 28,435 70,000 5,000 (46,565) 246.2% 263.8%

TOTALS 121,585 26,570 144,760 9,765 (59,510) 140.9% 148.9%

36

C D I A CVerbal Award

37

C D I A CPricing Bingo

[To be used on pricing calls with the underwriting desk]

Big BlocksHolding their cards close to

the vestWe've got good

momentumGood place to start

Couponing looks good Market tone feels good Aggressive Good interest at these levels

The right levels to go out We are getting pushback Balanced Get their attention

Behind the Curve Going away orders Market feels sloppy Build the book

Underwriter Bingo

38