Kayne Anderson Rudnick Investment Management, LLC has prepared and presented this report in compliance with the Global Investment Performance Standards (GIPS®).

Kayne Anderson Rudnick Investment Management, LLC, a wholly owned subsidiary of Phoenix Investment Partners, Ltd., is a registered investment adviser under the Investment Advisors Act of 1940. Kayne Anderson Rudnick Investment Management, LLC manages a variety of equity and fixed-income strategies focusing exclusively on securities the firm defines as high quality. Additional information regarding the firm's policies and procedures for calculating and reporting performance is available upon request. The firm maintains a complete list and description of composites, which is available upon request.

The composite is defined as all non-commissionable, fully discretionary California Intermediate Municipal Bond Portfolios (including cash) that are under management for at least one full quarter. The minimum account size for this composite is $1,000,000. For comparison purposes, the composite is measured against the Lehman Five-Year Municipal Bond Index, which is a market value weighted index of national municipal bond issues with maturities between four and six years. From January 1994 through June 2002, the composite was measured against the Lehman Five-Year Municipal Bond Index. From June 2002 through December 2004, the benchmark index was the S&P California Municipal Bond Index. The S&P California Municipal Bond Index is a market value weighted index of California municipal bond issues that are held by managed municipal bond fund customers of Standard & Poor's and that are priced daily. Historical returns for the S&P California Municipal Bond Index are available beginning January 1999. In January 2005, the benchmark was changed to the
Lehman Five-Year Municipal Bond Index. These changes were made in order to better reflect the composite's strategy for comparison purposes. The composite was created in January 1994. There was a change of personnel in October 2000, April 2003, and December 2004. No alteration of the composite as presented here has occurred because of these changes.

Prior to January 1, 2000, results include only eligible portfolios of at least $750,000. From January 1, 1999 through September 30, 2000, composite results include the fixed-income component of the firm's balanced portfolios whose fixed income portion was managed according to the California Intermediate Municipal Bond strategy. All cash balances were allocated to the equity and fixed-income components of the balanced portfolios at the beginning of each month based upon each component's target asset allocation.

The performance information is supplied for reference. Past performance is no guarantee of future results. Results will vary among accounts. The U.S. dollar is the currency used to express performance. Returns are presented gross of management fees and net of transaction fees and include the reinvestment of all income. Trade date accounting is used. Performance has been calculated by geometrically linking monthly returns with accounts entering and exiting the composite quarterly.

Gross annual returns will be reduced by investment management fees and other expenses that may be incurred in the management of the account. Net annual returns have been calculated after the deduction of an assumed maximum annual fee of 0.50%. The effect on performance would grow at a compounded rate. Over a five-year period, if a $1,000,000 portfolio had an annual return of 10%, it would grow to $1,610,510. The net compounded effect of a 0.50% annual investment management fee would total $36,271 and result in a portfolio value of $1,574,239. A fee schedule is available upon request and is described in Part II of the firm's ADV.

If applicable, the annual standard deviation presented is an asset-weighted calculation of performance dispersion for accounts in the composite for the entire year.