The Meeting Was Called to Order At

Delaware College Investment Plan DRAFT Delaware Higher Education Office Conference Room Board of Trustees Meeting March 12, 2014

Trustees Attending: Others Present: José Echeverri, Chair Shana Payne, Director, DE Higher Education David Gregor, Secretary of Finance, Designee Keith Bernhardt, Fidelity Investments, Tele Santosh Viswanathan Christopher Hattoy, Fidelity Investments, Tele Dan Scholl, Tele Peter Walsh, Fidelity Investments, Tele Karen Keegan, DE Higher Education Valerie Watson, Finance Designee (St of De)

José Echeverri called the meeting to order at 1:08 p.m.

Introductions of all in attendance.

Meeting minutes were approved by Dan Scholl and Valerie Watson, all others were in favor.

Christopher Hattoy gave a quick introduction of what would be discussed at this meeting.

Discussion was initiated by Peter Walsh (Fidelity) in reference to the Investment Performance Review. First wanted to make all aware Fidelity has a new portfolio manager. His name is Brett Sumsion. Beginning with the Investment Performance Review, Mr. Walsh stated the multi-firm the Fidelity dividend growth has been removed. There was a portfolio manager change, Larry Rakers came off the fund and Ramona Pesuaud came on. After discussion with Ramona, Fidelity feels she will change the structure of the portfolio and make it similar to what we’ve already got in other portfolios. With the removal of that structure, it was felt the fund could be removed and reallocate and get the characteristics that are already being seen in the portfolio.

Mr. Walsh states 2013 was a very high level year. He says S&P was up a bit. On page 3, there was very little rotation. Values stayed constant. Overall performance was very good. Looking at page 5, the actual portfolio allocations, the addition of the 2013 portfolio, launched on December 18, 2013. Flows are actively going into that portfolio now. On page 6, this is for age-based and the static portfolios. Outperformance across almost all the series and the aggressive growth fund trailed by 10 basis points. Good representation across the board. On page 7 is the multi-firm portfolios. A number of different firms are used to get the same representation. Multi-firm has mostly underperformed. On page 8 is the index, the exact same glide path with the exact same objective. The only difference is index is being used as the building blocks versus actively performed funds. Page 9 is the fidelity index funds, performance versus the composite benchmark, pretty tight tracking. Underperformance is mainly due to the fees for the product. On page 10, active portfolios outperformed in all the periods. The rest of the pages are more attribution…. page 13 shows all underlying funds, these are the funds that make up the target day funds. The rest of the pages are more attribution, who’s outperforming, who’s underperforming. Good performance for the quarter and the year.

1 Mr. Walsh also discussed the Active Allocation deck. Page 2 is a good executive summary as to what is trying to be accomplished. Same picture on page 3. Page 5 is more of a definition and a philosophy as to what is being accomplished, trying to adjust the weights. On page 9 are the guidelines, not very aggressive. Page 10 would be a good representation of high yield/very good asset class. On page 11 is asset manager 50, 50% equities, 50% income.

Mr. Echeverri introduced Mike Rogers, Coordinator of Athletic Partners from Delaware State University. Mr. Echeverri discussed the process of marketing, as an introduction.

Mr. Rogers discussed the marketing portion from the Delaware State University. Gave a handout outlining the ways the funds are utilized. The all sports camp is a 6 week camp for ages 6-12 for up to 100 campers. Start-up of the camp is the week after school dismisses for the summer and goes through the third week of July. Coaches provide instruction based on athletic area and also provides academic enrichment as well. All athletic and university facilities are on display during this time. Funding is through the Delaware College Investment Plan. Last year there was a total of 102 campers. Mr. Rogers handed out the pre-advertisement for this year and disseminated items that were given to campers last year. The DCIP was printed on all t-shirts and water bottles. Discussion sessions, between the college and the parents are being set up for this upcoming camp. Mr. Rogers was thanked for his presentation.

Mr. Echeverri discussed further possible sponsorships with the University of Delaware, DE Children’s Museum, Children & Families First, and Blue Rocks.

Christopher Hattoy discussed the Business Results deck. Great year in 2013 for the performance, per Mr. Walsh’s overview. Bringing momentum into 2014. The first slide is new accounts, highlighted in yellow, these are the 4th quarter results. Only down 1 account. Slide 3 is the growth sales, more growth sales this year than last year. Slide 4 is net sales, positive October & November. More distributions are coming into the plan due to the age & maturity of the plan. Slide 5 highlights main categories discussed, 4% growth. Gross sales are up 2%, very good. There has been $280,000 in marketing that has been spent, hospitals, homes, media, and online (biggest piece).

Mr. Echeverri discussed the guidelines for marketing and the 5 bullet points (Sponsorship Guidelines) attached to these minutes.

Motion to adjourn meeting submitted by Valerie Watson and Karen Keegan.

Respectfully submitted,

Karin Gotcher