Okla. Stat. tit. 62, § 62-2306

A. The Board of Investors of the Tobacco Settlement Endowment

Trust Fund shall discharge their duties as trustees of the Tobacco

Settlement Endowment Trust Fund:

1. With the care, skill, prudence, and diligence, under the

circumstances then prevailing, that a prudent person acting in a

like capacity and familiar with such matters would use in the

conduct of an enterprise of a like character and with like aims;

2. By diversifying the investments in the trust fund so as to

minimize the risk of large losses, unless, under the circumstances,

it is clearly prudent not to do so; and

3. In accordance with the laws, documents, and instruments

governing the trust fund.

B. The Board of Investors shall retain qualified investment

managers to provide for the investment of the monies of the trust

fund. The investment managers shall be chosen by a solicitation of

proposals on a competitive basis pursuant to standards set by the

Board of Investors. The investment managers shall manage those

monies of the trust fund allocated to the investment managers in

compliance with the overall investment guidelines set by the Board

of Investors. The monies of the trust fund allocated to the

investment managers shall be managed by the investment managers in

accordance with the investment guidelines and other directions of

the Board of Investors. The investment managers may sell

investments and realize losses if such action is considered

advantageous to longer-term return maximization. Because of the

total return objective, no distinction shall be made for management

and performance evaluation purposes between realized and unrealized

capital gains and losses. The Board of Investors may have the State

Treasurer manage those monies not specifically allocated to the

investment managers.

C. The trust fund may be invested in the manner in which a

prudent person would invest it and consistent with the manner that

state retirement funds are invested.

D. The Board of Investors shall select a custodial bank to

settle transactions involving the investment of funds in the trust

fund and to hold custody of the securities in the trust fund

portfolio. The custodian shall be a bank or trust company offering

pension fund master trustee and master custodial services. The

custodian shall be chosen by a solicitation of proposals on a

competitive basis pursuant to standards set by the Board of

Investors. The Board of Investors may also select professional

Oklahoma Statutes - Title 62. Public Finance Page 643

investment consultants, auditors, and actuaries to assist the Board

of Investors in carrying out its fiduciary responsibilities. All

these professionals shall be selected by a solicitation of proposals

on a competitive basis pursuant to standards set by the Board of

Investors.

E. The Board of Investors shall choose the professional

custodians and managers of the assets of the trust fund, shall

establish investment and fund management guidelines, and shall adopt

an investment policy. The selection of investment managers,

investment consultants, auditors, and actuaries, and a custodian

bank shall be exempt from the provisions of the Oklahoma Central

Purchasing Act.

F. The Board of Investors shall set aside cash reserves from

the earnings of the Tobacco Settlement Endowment Trust Fund if

requested by the Board of Directors of the Tobacco Settlement

Endowment Trust Fund pursuant to subsection B of Section 10 of this

act.

G. The State Treasurer shall provide any necessary staff

support to the Board of Investors. The cost of up to two full-time-

equivalent employees for the Office of the State Treasurer may be

considered as an administrative expense of the trust fund. However,

the amount provided to the State Treasurer for this purpose shall be

determined by the Board of Directors of the Tobacco Settlement

Endowment Trust Fund.