STRS Board actions on bonus-related motions proposed by Dennis Leone May 15, 2009

1. Bonus plan for Fiscal Year 2010: motion made by Dennis Leone, seconded by Craig Brooks; passed 8-0.

• Voting yes: Leone, Brooks, Burch, Meuser, Myers, Ramser, Puckett, Cervantes.

• Absent: Hayden & Chapman.

• Plan prohibits bonuses if overall return is negative.

• Plan restricts bonuses unless total STRS assets return to $65 billion (we now stand at $51 billion).

• For every $1 billion our total assets fall short of $65 billion at the end of FY 2010, bonuses will be reduced by 3%. Example: If we have $54 billion at the end of FY 2010, this is $11 billion under $65 billion. 11 x 3% = 33% reduction in bonus potential.

2. Motion by Dennis Leone, seconded by Craig Brooks: to prohibit bonuses beyond FY 2010 in years in which total returns are negative. Motion passed 8-0.

3. Motion by Dennis Leone: to remove Investment Chief Steve Mitchell from PBI (Performance-Based Incentive) Plan; motion died due to lack of a second. Dr. Leone cited conflict of interests concerns since Mitchell evaluates other bonus recipients.

4. Motion by Dennis Leone: to deny FY 2009 bonuses; motion died, due to lack of a second. This means between now and September the Board will have to vote on the actual payments for the 7/12 FY 2009 bonuses.
May 15, 2009