Ips final 5 21-14

INVESTMENT POLICY DATED 2/19/2014

AMENDED NONE

MOST RECENT TARGET ALLOCATION

REVISIONNONE

50-80% EQUITIES

10-40% FIXED INCOME

0-15% NON-CORRELATING

0-15% CASH

Fayette County Farm Bureau Education Foundation

IPS GUIDE DESIGNED BY

RUSSELL CAPITAL MANAGEMENT ©2014

INVESTMENT MANAGERS AND CONSULTANTS

476 East High Street

Lexington, KY 40507

859-254-5225 800-568-5225

ALLOWABLE ALLOCATION RANGE

65%

25%

5%5%

TARGET ALLOCATION

EQUITIES FIXED INCOME NON-CORRELATING CASH

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Copyright 2014 Russell Capital Management 2 of 17 Education IPS FINAL 5-21-14

CONTENTS PAGE NUMBER

Executive Summary 5

Terms and References 6

Investment Policy Discussion 6

Investment Policy Statement 6

The Need for a Written Policy 6

Introduction 7

Steps we have taken to establish this policy7

Commentary 8

Investment Return Objectives 8

Time Horizon 8

Risk Tolerance 8

Restrictions 8

Performance Benchmarks 8

Target Asset Allocation 9

Frequency of Review 9

Diversification 10

Permitted Asset Classes 10

Permitted Security Classes 10

Investment Monitoring and Control Procedures10

Written Reports 10

Meetings and Communications 11

Duties and Responsibilities Under This IPS11

Advisor Duties and Responsibilities 11

The Committee’s Duties and Responsibilities 12

Adoption 13

Contact Information 14-16

Our Key Contacts Appendix A

Our Organization Contacts Appendex B

Advisor Contacts Appendex C

Amendment and Revision Log Appendix D


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TAX ID 61-1309346

DATE OF POLICY 2/19/2014

DATE OF AMENDMENT NONE

MOST RECENT TARGET ALLOCATION REVISION NONE

INVESTMENT OBJECTIVE TOTAL RETURN WITH EMPHASIS ON GROWTH OVER INCOME

TIME HORIZON EIGHT YEARS

RISK TOLERANCE MODERATE-HIGH

INVESTMENT RETURN OBJECTIVE CPI PLUS 4%

OVER A TIME PERIOD OF ROLLING FIVE YEARS

PERFORMANCE BENCHMARK 70% S&P 500 / 30% BARCLAYS AGGREGATE BOND

INVESTMENT RESTRICTIONS

Commodities, precious metals and real estate investments are restricted in this

account. An international equity range of 5-15% of total equities, with a target of

10%, is established. The Finance Committee will meet semi-annually (spring and fall)

with their Investment Advisor to review the investment and administrative guidelines

of this account. For further guidelines, see Exhibit 1 in Appendix "D".

TARGET ASSET ALLOCATION

EQUITIES 65%

FIXED INCOME 25%

NON-CORRELATING INVESTMENTS 5%

CASH AND EQUIVALENT 5%

ALLOWED ALLOCATION RANGE

EQUITIES 50-80%

FIXED INCOME 10-40%

NON-CORRELATING INVESTMENTS 0-15%

CASH AND EQUIVALENT 0-15%

REVIEWS AND FREQUENCYS

IPS ANNUALLY

PERFORMANCE MEETING WITH MANAGER SEMI-ANNUALLY

INVESTMENT STRATEGY ANNUALLY

CALENDAR YEAR PERFORMANCE REPORTS AT LEAST QUARTERLY

EXECUTIVE SUMMARYFayette County Farm Bureau Education Foundation

INDIVIDUAL STOCKS

INDIVIDUAL DOMESTIC FIXED INCOME

BANK CD'S

PERMITTED ASSET CLASSES

EQUITIES

FIXED INCOME

ALTERNATIVE INVESTMENTS

SECTOR FUNDS

CASH AND EQUIVALENT

PERMITTED SECURITY CLASSES

1040 ACT MUTUAL FUNDS


TERM REFERS TO

The Fund Fayette County Farm Bureau Education Foundation

IPS This Investment Policy Statement

The Committee Finance Committee

The Advisor Russell Capital Management

The Need for a Written Policy

The principal reason for developing a written long-term investment policy is to enable the Committee and the Advisor

to protect The Fund from ad hoc revisions of sound long-term policy. A written investment policy will help us

maintain a long-term view when short-term market movements may be distressing and the policy is in doubt.

The development of an investment policy follows the basic approach underlying sound financial planning: assessing

our financial condition, setting goals, developing a strategy to meet our goals, and implementing the strategy.

Designing and implementing an investment policy encourages us to become more disciplined and more systematic,

thus improving the probability of satisfying the investment goals of The Fund.

The overall goal of the policy is to increase the likelihood that The Fund will meet the financial needs of our

organization.

Investment Policy Statement

Terms and References

Investment Policy Discussion

This Investment Policy Statement (IPS) outlines the investment objectives, fund risk tolerance, the investment

management procedures and the long-term goals for



Assessed our current and future financial needs.

Determined our tolerance for risk and our investment time horizon.

Specify the target asset allocation policy.

Establish investment guidelines regarding the selection of permissible securities and diversification of assets.

Specify the criteria for evaluating the performance of The Fund’s assets.

Define the responsibilities of the Committee and the Advisor.

Encourage effective communication between the Advisor and the Committee.

By accepting this IPS and investing The Funds the Advisor acknowledges that this IPS does not change the legal

relationship between our organization and the Advisor, nor diminish the Advisor’s legal and fiduciary obligations to us

and The Fund.

Introduction

The purpose of this IPS is to establish a clear understanding between the Committee and the Advisor as to the

investment goals, objectives and management policies applicable to The Fund.

This Policy Statement Should

Establish reasonable expectations, objectives and guidelines for the investment of The Fund’s assets.

Create the framework for a well-diversified asset mix that can be expected to generate acceptable long-term returns at

a level of risk suitable to The Fund.

Describe an appropriate risk posture for The Fund’s investments.

Steps we have taken to establish this policy

Assessed our financial situation and identified our goals.

Set long term investment objectives.

Identified restrictions on the portfolio and its assets.

Determined the permissible asset classes and security types.

Established a Risk Tolerance and Asset Allocation, to maximize the likelihood of achieving our investment objectives

at the lowest level of risk.

Determined the investment methodology to be used with regards to investment advisor oversight, portfolio reviews

and reporting.


Commentary

Fayette County Farm Bureau Education Foundation is a 501(c)(3) that identifies, through a competitive grantmaking

process, Fayette County students who have excelled in academic, extracurricular and/or agricultural activities, and who

are likely to make an impact on our present and future Bluegrass area. We provide scholarship support to selected

individuals for a maximum of eight consecutive semesters of undergraduate studies. This scholarship fund represents

fundraising and development dollars invested to support our ongoing scholarship mission.

Investment Return Objectives

CPI PLUS 4%

The specific objectives for the Fund shall be to achieve not less than an annualized rate of return of


Investment theory and historical capital market return data suggest that, over long periods of time, there is a

relationship between the level of risk assumed and the level of return that can be expected in an investment program.

Taking the relevant factors into account, the Committee establishes the risk tolerance for The Fund as

for the aggregate investments under this Policy Statement. The Committee recognizes that all investments go through

cycles and, therefore, there will be periods of time in which the investment objectives are not met. On an overall

portfolio basis, the Committee establishes a goal of achieving the stated investment return objectives over a long-term

period, which for purposes of this Fund is

Time Horizon

Capital values do fluctuate over shorter periods and the Committee recognizes that the possibility of capital loss does

exist. However, historical asset class return data suggest that the risk of principal loss over a holding period of at least

5 years can be minimized with the long-term investment mix employed under this IPS.

Risk Tolerance

Restrictions

Commodities, precious metals and real estate investments are restricted in this account. An international equity range

of 5-15% of total equities, with a target of 10%, is established. The Finance Committee will meet semi-annually

(spring and fall) with their Investment Advisor to review the investment and administrative guidelines of this account.

For further guidelines, see Exhibit 1 in Appendix "D".

For the purposes of planning the time horizon for the fund is to be from

EIGHT YEARS

ROLLING FIVE YEARS

Performance Benchmark

70% S&P 500 / 30% BARCLAYS AGGREGATE BOND

MODERATE-HIGH


ASSET CLASS TARGET ALLOCATION

EQUITIES 65%

FIXED INCOME 25%

NON- CORRELATING 5%

CASH AND MONEY MARKET 5%

ASSET CLASS PERMITTED ALLOCATION RANGE

EQUITIES 50-80%

FIXED INCOME 10-40%

NON- CORRELATING 0-15%

CASH AND MONEY MARKET 0-15%

NON-CORRELATING investments are strategic alternative investments, precious metals, real estate, commodities

and other non-traditional investments.

ASSET ALLOCATION CHANGES

From time-to-time, it may be desirable to amend the basic allocation policy or calculations. When such changes are

made they will be considered amendments and noted as such in the document and the Revision Log.

ANNUALLY

The investment strategy utilized by the Advisor shall be reviewed to promote a full understanding of the strategy by

the Committee and it's new members at least

The investment performance with appropriate benchmarks shall be reviewed by the Committee at least

SEMI-ANNUALLY

ANNUALLY

Target Asset Allocation

The following asset classes and allocations were selected to best achieve the objectives of The Fund.

FIXED INCOME investments are debt securities of a government or corporation.

EQUITIES are stocks which represent an ownership interest in a company.

Frequency of Review

This IPS shall be reviewed by the Committee at least

It is understood that this allocation is desired as a goal, but it is recognized by the Committee that, from time-to-time,

factors such as market fluctuations, the Advisor's technical and fundamental outlook and other factors may create a

somewhat different allocation. The Advisor is allowed a variance from this target allocation objective.


EQUITIES Listed U.S. and Non-U.S, Mutual Funds, and ETFs.

FIXED INCOMEDomestic Bonds, Notes, Bills, Domestic and Global Funds and

ETFs.

ALTERNATIVE INVESTMENTS Liquid 1940 Act Non-diversified Mutual Funds and ETFs.

SECTOR FUNDS Sector Funds and ETFs.

CASH AND EQUIVALENT Cash, equivalents and money funds.

0

0

1040 ACT MUTUAL FUNDSOpen and Closed End, Diversified and Non-Diversified Mutual

Funds and ETFs.

INDIVIDUAL STOCKSListed on the New York, American or NASDAQ Stock

Exchanges.

INDIVIDUAL DOMESTIC FIXED INCOME AA rated or better and domestically traded.

BANK CD'S Insured Bank certificates of deposit.

Investment Monitoring and Control Procedures

Written Reports

The Committee shall receive no less frequently than on a quarterly basis, and within 15 days within the end of each

calendar year quarter, the following management reports:

Permitted Security Classes

Diversification

Permitted Asset Classes

g) Any recommendations for changes of the above.

a) The Fund performance results over the last quarter, year, and since inception.

b) Performance results of comparative benchmarks for the same periods.

c) Performance shall be reported on a basis that is in compliance with Global Investment Performance Standards

(GIPS) on a net-after fees basis. (formerly AIMR standards)

d) End-of-quarter asset allocation percentages.

e) Capital additions and withdrawals for the quarter in a readable, concise format.

f) Beginning and Ending values for each period in a) above.

g) Periodic investment statements from the non-affiliated custodian.


and any related issues at least SEMI-ANNUALLY

9. Meet with the Committee at least

The Advisor shall also be available on a reasonable basis for telephone communication when needed.

Any material event that affects the ownership of the Advisor’s firm or the management of The Fund must be reported

immediately to the Committee.

The Advisor shall direct all communications to the Key Contact of the Committee. In the event that the Key Contact is

not available, communications should be made to a secondary contact approved by the Committee. Contacts for the

advisor and the Committee are in Appendix “A” to this IPS.

Duties and Responsibilities Under This IPS

Advisor Duties and Responsibilities

Meetings and Communications

As a matter of course the Advisor shall keep the Committee apprised of any material changes in the Advisor’s outlook,

recommended investment strategy and tactics. Any major shift should be reviewed by the Committee and acted upon if

necessary.

In addition, the Advisor shall be available to meet with The Committee to review the investment results

7. Recommend changes to any of the policies set forth herein, including target asset allocations.

8. Periodically review the suitability of the investments for The Fund.

10. Prepare and present appropriate reports.

11. Construct appropriate benchmarks for the investment account.

12. The Advisor shall exercise discretionary control over the assets under its management.

1. To Design and implement an appropriate asset allocation plan consistent with the investment

objectives, time horizon, risk profile, guidelines and constraints outlined in this statement.

2. Recommend an appropriate Unaffiliated Custodian Broker to safeguard The Fund’s assets. The

unaffiliated Custodian Broker shall provide monthly brokerage statements to the Committee, values for each

asset and all transactions affecting assets within the portfolio, including additions and withdrawals.

3. Advise the Committee about the selection of and the allocation of asset categories.

4. Identify specific assets and investment managers within each asset category.

5. Ensure that the custodian provides the Committee with a current prospectus, where applicable, for

each investment proposed for the portfolio.

6. Monitor the performance of all selected Assets.

and be available at such other times within reason at the Committee’s request.

SEMI-ANNUALLY

13. The Advisor will not take title to any assets.

The Advisor is expected to manage the Portfolio in a manner consistent with this IPS and in accordance with State and

Federal law. The Advisor shall be a Registered Investment Advisor and, as such, shall be a fiduciary.


3. Communicate to the Advisor:

a. Who the governing body for The Fund is; whether it is a committee appointed by the board, a

committee composed of the officers and directors of our organization, or the board itself.

b. The nature of The Fund, a foundation, endowment, or part of the general funds of our

organization.

c. Is The Fund or part thereof to be segregated for principal or distribution purposes?

4. Define the investment objectives and policies of The Fund.

5. Review and approve or disapprove the Advisor’s recommendations with regards to policy,

guidelines, and objectives.

The Committee’s Duties and Responsibilities

1. Represent our organization with respect to The Fund.

2. Furnish the investment advisor with appropriate information regarding our organization: our fund’s

purpose; board member’s titles and contact information; staff positions and contact information; The Fund

governing committee titles/positions, occupations, and contact information and any other pertinent

information that will assist the advisor in understanding our goals and needs and the individuals involved in

The Fund.

6. Contract with a Registered Investment Advisor to manage the investment portfolio as a fiduciary.

7. Define any restrictions on the management of The Fund and it's distributions.



BY AUTHORIZED SIGNOR

Adoption

Adopted and agreed to by the below signed:

ADVISOR SIGNATURE

SIGNOR'S TITLE

Date: ___________________

FIRM NAME

Date: ___________________

Russell Capital Management


Primary Contacts Appendix "A"

KEY CONTACT

NAME Carrie Johnson

TITLEEXECUTIVE DIRECTOR, FAYETTE COUNTY FARM

BUREAU

PRIMARY PHONE 859-253-0023

CELL PHONE 859-509-4134

EMAIL [email protected]

ADDRESS FOR COMMUNICATIONS 1316 Versailles Road, Lexington, KY 40504

NAME Katherine N. Sautter

TITLE PRESIDENT, EDUCATION FOUNDATION


CELL PHONE 0


ADDRESS FOR COMMUNICATIONS 4451 Newtown Pike, Lexington, Ky 40511

SECONDARY CONTACT

Contact Information



Organization Contacts Appendix "B"

* READ ONLY LOGIN AUTHORIZED

**DUPLICATE PERFORMANCE REPORTS

***INDICATES BOTH

NAME AND TITLE/POSITION MAILING ADDRESS

Katherine N. Sautter/PresidentFayette County Farm Bureau, 1316 Versailles Road, Lexington,

Ky 40504

Jill Mahan/Vice President "

Dr. John Barton/Treasurer "

Walter Hillenmeyer/Board Member "

Sherry Ferguson/Board Member "

Stephen Schnettler/Accountant 300 W. Maxwell St., Lexington, Ky 40508


ADVISOR INFORMATION

FIRM NAME Russell Capital Management

ADDRESS FOR COMMUNICATIONS 476 East High Street, Lexington, Ky 40507

PRIMARY ADVISOR'S NAME Ford N. Lankford


0

ADVISOR'S WEBSITE www.russcap.com


ADVISOR'S ASSISTANT Kim Osborne



ADVISORY FIRM CHIEF COMPLIANCE

OFFICER CONTACT INFORMATIONJack Russell - 859-254-5225 - [email protected]

TECHNOLOGY CONTACT INFORMATION Keith Day - 859-254-5225 - [email protected]

Contact Information

Russell Capital Management

Appendix "C"


REVISION DATE ITEM REVISED

May 21, 2014 Investment Restrictions

Amendment and Revision Log

Appendix "D"

Exhibit 1 to Fayette County Farm Bureau Education Foundation IPS, dated May 21, 2014:

A. Education members/officers authorized to direct the Advisor in account administration:

Katherine N. Sautter, President

Dr. John Barton, Treasurer

Walter Hillenmeyer, Secretary

B. Members of the Finance committee:

Katherine N. Sautter

Dr. John Barton

Walter Hillenmeyer

Jill Mahan, Vice President

Sherry Ferguson

C. Investment Restrictions (further clarification)

With a quorum present, a majority vote of the Education Foundation can amend these restrictions at any time.

The Finance Committee has elected to adopt a Moderate-High Risk tolerance upon agreement that adequate cash

reserves for potential budgetary shortfalls shall be held outside of this fund.

It is the Finance Committee’s desire that neither the income nor the principal of the funds be invaded for Five

years. After Five years, on an annual basis, the income generated by the fund can be withdrawn. Income not

withdrawn shall then be considered principal.

If cash reserves are not adequate to meet budgetary needs then the income and or principal of the account may be

invaded to satisfy these needs. This action is allowable if, with a quorum present, a majority of the Education

Foundation votes to amend the above restrictions noted here in Exhibit 1 and in the Investment Policy Statement.


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