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02-08-2007 Regular Meeting MIAMI SHORES VILLAGE GENERAL EMPLOYEE PENSION BOARD REGULAR MEETING FEBRUARY 8,2007 1. CALL TO ORDER The regular meeting of the Miami Shores Village General Employee Pension Board was held on Thursday, February 8,2007 in the Conference Room of the Village Hall. The meeting was called to order at 8:30A.M. 2. ROLL CALL In order for the record to reflect those present,the roll was called with the following members present: Present Herta Holly Angela Dorney Tom Benton Averill Dorsett Joseph Charles Absent Mary Ross Agosta James McCoy Also Present: Steve Cypen,Pension Board Attorney Mark A. Malatak,Plan Administrator Lisa Keeley,Recording Secretary 3. APPROVAL OF MINUTES—November 9,2006 and January 10,2007 Mr.Benton moved for approval of the November 9,2006 minutes as submitted with a second from Ms.Dorsett. The motion passed unanimously. Mr.Charles moved for approval of the January 10,2007 minutes as submitted. The motion was seconded by Mr.Benton and passed unanimously. Mr.Cypen noted an action taken during the January 10,2007 meeting was not actually carried as there must be a majority of the Board(or four members'approval). The vote only had three in the affirmative. He suggested that the agenda be amended to add an item that readdresses a discussion on the investment manager presentation and the Aletheia Research and Management contract. Mr.Benton so moved with a second by Mr.Charles.The vote was unanimous in favor. Mr. Benton then moved to instruct the Plan Administrator to bring the Aletheia Research and Management contract to the Board meeting of February 8, 2007. The motion was seconded by Ms. Dorsett. The motion carried with a vote in the affirmative by Mr. Benton, Mr. Charles, Mrs. Dorney and Mrs. Holly. Ms. Dorsett remained opposed. 4. APPROVAL OF PAYMENT WARRANT—General Employee Warrant No.2007-004 Mr.Benton moved for approval of payment warrant General Employee Warrant No.2007—004 as submitted. Ms.Dorsett seconded the motion which was passed unanimously. General Employee Pension Board February 8,2007 Page 2 6. CONSULTANTS REPORT-Merrill Lynch—Alan Kirchner Mr.Kirchner reviewed the investment manager's returns for the quarter ending December 31,2006. The total market value of the fund was$8,634,170,a net increase of$362,250. The total fund returned 4.7%exceeding the target index but ranking in the sixty-third percentile compared to the public balance fund sample. 5. DISCUSSION AND POSSIBLE ACTION REGARDING THE MONEY MANAGER Mr.Kirchner confirmed the Board's direction based on the last few meetings with the objective as terminating the Plan's contract with Davis,Hamilton,Jackson and Associates due to underperformance over the five-year period and confirming interest in the investment firm of Aletheia Research and Management. Based on this premise,an overview of the changes to the Plan's asset allocation was provided showing the move to Small/Midcap Equities, International Equities,Large Cap Growth(Aletheia)and Large Cap Value(Boston Company)with a weighting in Fixed Income through the Boston Company. Mr. Kirchner provided an Addendum to the Statement of Investment Policy for the Boston Company Revised February 8,2007 based on the new asset allocations. The Board reviewed the changes and accepted them as the changes were indicative of prior Board actions. Mr. Benton then moved to terminate Davis,Hamilton, Jackson&Associates coincident with entering into an agreement with Aletheia Research and Management subject to attorney approval. Mr. Charles seconded the motion which passed unanimously. Review of the Statement of Investment Policy Addendum for Aletheia Research and Management was provided by Mr.Kirchner and Mr.Cypen. Mr.Cypen noted on page 1,under Guidelines#6,it should read"Convertible bonds and preferred stocks shall be prohibited. He also indicated that on page 2, paragraph 1, "Private placements shall be prohibited." Page 2,Investment Objective#2,should quantify"over the longer term"to a 3- 5 year period. Mr. Benton moved for approval of the Statement of Investment Policy Addendum for Aletheia Research and Management with the changes as indicated by Mr.Cypen. Ms.Dorsett seconded the motion which passed unanimously. 9. OTHER BUSINESS There was no other business. 10. ADJOURNMENT The February 8,2007 regular meeting of the General Employee Pension Board was adjourned at 9:35 AM with a motion from Mr.Benton seconded by Ms.Dorsett,passing unanimously. Herta Holly,Chairperson Lisa Keeley,Recording Secretary General Employee Warrant No. 2007 - 004 For payment from the Village Pension Fund for General Employee's in the Village of Miami Shores,Florida. To Chair and Administrator,or such other officers,who from time to time are duly designated and authorized by the Board of Trustees of said Fund,to sign checks,drafts or orders for the payment of money;You are hereby authorized by the Board of Trustees of the Miami Shores Village Pension Fund for General Employees in Miami Shores Village to pay the amounts listed below for services rendered to the said Board of Trustees,and to pay the persons named below,hereby certified by the Board of Trustees as being on the Pension list of said Board via this payment request pensions from 11/01/06 to 02/01/07 inclusive,or for the period of time opposite the name of said persons. Name(Pensions,Benefits,Services Provided or Obligations) Amount To be paid by Trustee: Authorize payment to Davis,Hamilton,Jackson&Associates Quarterly management fees for the period 01/01/07—03/31/07 $4,822.18 Authorize payment to The Boston Company Quarterly management fees for the period 10/01/06—12/3 1/06 $ 7,029.25 Authorize payment to Merrill Lynch Consulting Services Quarterly consulting services for the period 10/01/06—12/31/06 Not to exceed$4,250.00 Authorize payment to Salem Trust Company Quarterly fee for period 10/01/06—12/31/06 $ 1,305.39 Ratify Retirement Benefit Payable: Luis Hernandez -previously approved by signature $1,012.92/monthly Warrant No.2007-003 Authorize Lump Sum Distribution of Employee Pension Contribution Rodolfo Valdes $2,503.85 Dated this 8th day of February,2007 Approved by: _ Herta Holly,Chairper on As Chair of the Board of Trustees Village Pension Fund for General Employee's in the Village of Miami Shores,Florida