Executive Com. Meeting Minutes

FROM THE SPJST Executive Committee

October 20 and 21, 2021, Minutes of the Regular Meeting of SPJST Executive Committee held at the SPJST Home Office Temple, Texas

PRESIDING The meeting was called to order by Board of Directors’ Chair John Engelke on Tuesday, October 20, 2021, at 8:55 a.m.

ATTENDING Board of Directors: Donnie Victorick - District One/Vice Chair of the Board of Directors; Jesse Pospisil - District Two; John Engelke - District Three/Chair of the Board of Directors; Bobby Davis - District Four; Bradley Stavinoha - District Five; Annie Vahalik - District Six; Regina House - District Seven. Executive Officers: Brian Vanicek, President/CEO; Delisle Doherty, Vice President of Sales and Marketing; Leonard Mikeska, Chief Financial Officer; Roy Vajdak, Controller; Melanie Zavodny, Vice President of Communications. Recording Secretary: Linda Hill, Executive Assistant to the Chief Financial Officer.

OPENING OF MEETING The meeting was opened by Board Chair Engelke with a welcome to all. The Pledge of Allegiance was recited, and a moment of silence was observed in respect for our departed members. Chief Financial Officer Mikeska led the Executive Committee in an opening prayer.

ANNOUNCEMENTS President/CEO Vanicek announced the visitors who would be joining the meeting: Home Office Staff Members at 11 a.m.; Rob Clift, Executive Director of Camp Kubena at 1 p.m.; and Larry White and Stephen Gonzalez of AQS Asset Management at 4 p.m. Dinner with RVOS leaders would be at 6 p.m.

Home Office Staff Member Linda Hill will be the recording secretary.

APPROVAL OF SUPREME LODGE MINUTES After review July 20 and 21, 2021, regular minutes of the Supreme Lodge meeting, Director Stavinoha moved we accept all the minutes as written. Director Pospisil seconded the motion, and it carried unanimously.

MANAGEMENT TEAM MEETING NOTES The management team meeting notes were reviewed. Director Stavinoha moved to acknowledge the notes as written. Director Vahalik seconded the motion, and it carried unanimously. Recess was from 5:20 p.m. until Wednesday, October 21 at 8:46 a.m.

Board Chair Engelke welcomed everyone to the meeting. Chief Financial Officer Mikeska led the Executive Committee in an opening prayer.

NEW BUSINESS The Executive Officers each presented a report on their new business.

President/CEO Vanicek presented a program to designate an SPJST Youth Charter Committee, which consists of President/CEO Vanicek, Director Victorick, Director Pospisil, Director House, Director Vahalik, Vice President of Communications Zavodny, State Fraternal Director Frank Horak, Camp Kubena Executive Director Rob Clift, and all District Youth Counselors (DYCs). Director Engelke recommended that the committee meets on November 4.

OLD BUSINESS President/CEO Vanicek, Vice President of Sales and Marketing Doherty, Chief Financial Officer Mikeska, Controller Vajdak, and Vice President of Communications Zavodny each presented a report on their old business, and each report was accepted as presented.

President/CEO Vanicek congratulated Lodge 1, Fayetteville on the secured grant of $50,000 from Texas Historical Association to complete the restoration of Lodge 1’s historic hall.

Recess was from 9:57 to 10:10 a.m.

STRATEGIC PLANNING MEETING The strategic planning meeting will be November 22 and 23. The BKD report and budget will be central themes. The meeting will begin at 10 a.m. on November 22.

MEMBERS’ PORTAL Controller Vajdak discussed a program of the members’ portal system. Director Victorick moved to add a members’ portal that would allow members to review their certificates online. The cost would be $20,000. Director Vahalik seconded the motion, and the motion carried unanimously.

HOME OFFICE STAFF RECOGNITION Several Home Office Staff were recognized for a total of 165 years of service. They were Linda Hill - 10 years and Marissa Salinas - 15 years from Chief Financial Officer Mikeska’s department; Cynthia Hutka - 35 years from Vice President of Sales and Marketing Doherty’s department; Marie Wolf - 5 years, Debbie Dohnalik - 45 years, and Dorothy Stuchly - 55 years from Controller Vajdak’s department.

Recess was from 12 to 12:50 p.m.

CAMP KUBENA Executive Director Rob Clift presented a comprehensive report on Camp Kubena.

EXECUTIVE SESSION The Committee entered executive session to discuss salaries.

Recess was from 3 to 3:28 p.m.

AQS INVESTMENT REPORT Larry White and Stephen Gonzalez of AQS presented a report on SPJST investment performance and book yield increase from 4.37 percent to 4.69 percent since January 1, 2021. Needed changes to the investment policy statement were reviewed. Director Stavinoha moved, and Director House seconded, that maximum amount of NAIC-2 be increased to 55 percent of assets and the real estate mortgages amount be increased to 15 percent. Director Victorick moved, seconded by Director Stavinoha, to amend motion to increase from 15 percent to 20 percent. Vote was taken, and the amendment carried unanimously. EXECUTIVE SESSION The Committee entered executive session to discuss salaries.

It was noted that there are 41 full-time equivalent SPJST employees of which 33 work at the Home Office. Director Pospisil moved, seconded by Director Victorick, to give each full-time employee a bonus of $500 and $ 250 to part-time employees. The motion passed with six in favor and one opposed. Voting in favor: Director Victorick, Director Pospisil, Director Engelke, Director Davis, Director House, and Director Vahalik. Opposed: Director Stavinoha.

Recess was from 10:13 to 10:29 a.m.

Controller Vajdak discussed information for a technology support specialist and assistant controller. Motion was made by Director Stavinoha, seconded by Director Vahalik, to search for applicants for an assistant controller position, which would be evaluated by a committee. Motion carried unanimously.

President/CEO Vanicek proposed that the SPJST 125th anniversary be celebrated in October 2022 at the Texas Czech Heritage and Cultural Center in La Grange and in conjunction with its annual heritage festival.

The Committee entered executive session to discuss one of the lodges concerning audit of that lodge.

Recess for lunch was from 12:26 to 1:10 p.m.

Vice President of Sales and Marketing Doherty presented new annuity products. Motion was made by Director House, seconded by Director Pospisil, to accept these changes to the annuity products that we would allow children to meet membership requirements by purchasing an annuity. Motion carried unanimously.

Chief Financial Officer Mikeska presented his report of investments. Motion was made by Director House, seconded by Director Vahalik, to ratify the investments for the period beginning July 1, 2021, through September 30, 2021. The motion carried unanimously.

Director Pospisil moved, seconded by Director Vahalik, to leave interest payout rates on annuities and Universal Life certificates unchanged from November 1, 2021, to January 31, 2021. Motion carried unanimously. Interest rates on currently marketed products are:

Product Current Rate Plan Codes Universal Life 4 3.00% 1282 to 1309 1-Year Annuity 1.25% 8067 2-Year Annuity 1.75% 8068 5-Year Annuity 3.25% 8064 Annuity 7 3.25% 8069 to 8075 Lodge Mgmt. Fund 3.25%

Director Stavinoha moved, seconded by Director Davis, to the correction on presented rates to read as 3.25 percent on the lodge management fund account. Motion carried unanimously.

Controller Vajdak discussed the appointment of the auditors for the 2021 audit. Motion was made by Director Victorick, seconded by Director Stavinoha, to appoint the JRBT firm. Motion carried unanimously.

Director Stavinoha discussed investing in a private equity fund. Motion was made by Director Stavinoha, seconded by Director Davis to invest one-half percent of our portfolio, which could be up to $1.3 million. The motion failed with two in favor, four opposed, and one abstaining. Voting in favor: Director Davis and Director Stavinoha. Opposed: Director Victorick, Director Pospisil, Director Engelke, and Director House. Abstaining: Director Vahalik.

CHAIR OF THE BOARD OF DIRECTORS Board Chair Engelke deferred his presiding role to President/CEO Vanicek to conduct the election for Chair and Vice Chair of the Board of Directors. Director Victorick nominated Director Engelke to serve as Chair of the Board of Directors in 2022. Director Pospisil made a motion that nominations cease and Director Engelke be elected by acclamation. The motion was seconded by Director Vahalik. Motion carried unanimously.

VICE CHAIR OF THE BOARD OF DIRECTORS Director Stavinoha nominated Director Victorick to serve as Vice Chair of the Board of Directors in 2022. Director Vahalik made a motion that nominations cease and that Director Victorick be elected by acclamation. The motion was seconded by Director House. AUDIT COMMITTEE Director Stavinoha asked to be removed from the Audit Committee. Audit Committee members for 2022 are Director Pospisil, Director House, and Director Victorick.

2022 EXECUTIVE COMMITTEE MEETING DATES Dates for Executive Committee meetings in 2022 are:

January 18 and 19 (Audit Committee meets on January 17.)

April 19 and 20

July 19 and 20 (Audit Committee meets on July 18.)

October 18 and 19

ADJOURNMENT There being no further business, Director Davis moved for adjournment. Director House seconded the motion, and the motion to adjourn carried unanimously.

Board Chair Engelke adjourned the meeting at 5:10 p.m.

The next regular meeting of the Executive Committee will begin at 8 a.m. on January 18, 2022. Fraternally submitted by, Linda R. Hill, Recording Secretary Leonard Mikeska, Chief Financial Officer —SPJST—

DISTRICT DIRECTORS’ REPORTS

District One Director Donnie Victorick

Activity Report

July—District One delegates’ meeting in Snook; District One delegates’ meeting in La Grange; State Youth Achievement Day in Temple.

August—Lodge 9, Snook meeting; SPJST Convention in Killeen; meeting with President/CEO Vanicek and Board of Directors; travel to Lodge 13, Dime Box to pick up CSPS storage cabinet.

September—Lodge 9, Snook meeting; Westfest; Lodge 38, Kovar meeting and delivered sign; Burleson County Fair Parade with District One Royalty; Lodge 47, Seaton Outdoor Extravaganza.

October—Visitation for Lodge 24, Cyclone member Milton Zavodny in Temple; Camp Kubena Advisory Committee meeting and strategic planning session; Lodge 9, Snook meeting; visitation for Lodge 38, Kovar member Rita Janak. Fraternally, Donnie Victorick, FICF, CFFM District One Director/ Board of Directors Vice Chair

District Two Director Jesse Pospisil

Activity Report

July—Helped prepare hamburgers at Camp Kubena; Lodge 47, Seaton Barbecue Cook-Off; Lodge 29, Taylor meeting; Supreme Lodge meeting; delivered new signs to Lodges 47, Seaton / 48, Beyersville / 87, Temple / 177, Academy; delivered new sign to Lodge 24, Cyclone and attended District Two delegates’ meeting; continuing education class “All About Annuities”; virtual class - “Whole Life Basics”; State Youth Achievement Day.

August—Lodge 29, Taylor meeting; SPJST Convention in Killeen; Lodge 48, Beyersville fundraiser; Lodge 80, Holland meeting.

September—Lodge 29, Taylor meeting; funeral service for Honorary Supreme Lodge Vice President Gene McBride.

Commentary

We had a very productive meeting. We discussed and voted on many issues. We were able to make our decisions due to the excellent data not only from the officers, but also from the directors. I was anxious to attend our first meeting under the new governance structure. I was wondering how the meeting would be held. But the meeting went in the usual orderly manner as before.

Congratulations to the Home Office staff members who received their service awards. The years of service to SPJST were from five years all the way to 55 years with the total years of service being 165 years from six employees. That’s incredible!

Thank you to John Engelke and Donnie Victorick for serving as chair and vice chair, respectively, in 2020 and congratulations to both for being re-elected to serve in 2022. Fraternally, Jesse Pospisil District Two Director

District Three Director John Engelke

Activity Report

July—District Three delegates’ meeting at Lodge 25, Ennis; Lodge 66, Waco meeting; Fraternal Focus webcast.

August—Visitation and funeral service for Barbara Ladd of Waco; pick up lodge signs at the Home Office; SPJST Convention in Killeen; Lodge 66, Waco meeting; virtual meeting with President/CEO Vanicek and Board of Directors.

September—Funeral service for Robert Kasik of West; peeled potatoes at Lodge 6, Cottonwood for Westfest; Westfest parade; special called Board of Directors’ virtual meeting on annuities; Lodge 180, Burleson meeting; funeral service for Honorary Supreme

Lodge Vice President Gene McBride in Temple; Lodge 92, Fort Worth strategic planning session and delivered signs; delivered signs to Lodge 154, Fort Worth; delivered signs to Lodge 25, Ennis; Lodge 66, Waco meeting; Fraternal Focus webcast.

October—Funeral service for Lodge 24, Cyclone member Milton Zavodny in Temple; Camp Kubena Advisory Committee meeting and strategic planning session; District Youth Counselors’ meeting at Camp Kubena; Czech Fest at Dallas Sokol; Fraternal Focus webcast; Executive Committee meeting in Temple.

Commentary

Thank you to all our distinguished employees and all who serve our members every day. All our employees are greatly deserving of our appreciation.

To our members, please enjoy the rest of this year with family and friends. Please make all those moments special, and we will hope for a great new year. Fraternally, John Engelke District Three Director/ Board of Directors Chair sion, we need to really think things out and what is best for SPJST, and let’s grow SPJST together. Fraternally, Bobby Davis, FICF, CFFM District Four Director

District Five Director Bradley Stavinoha

• • • District Four Director Bobby Davis

Activity Report

July—Pick up signs in Katy for lodges; whole life training; Fraternal Focus webcast; State Youth Achievement Day.

August—Polka fest in Needville; delegates’ webcast; mounted signs on building at Lodge 81, Needville; SPJST Convention in Killeen; Lodge 81, Needville fundraiser dance; sales agent class in Needville; virtual meeting with President/CEO Vanicek and Board of Directors.

September—Meeting with Vice President of Sales and Marketing Doherty in Wharton; Shiner/hall picnics; Lodge 191, Lufkin meeting and delivered signs; Lodge 91, San Jacinto meeting; delivered signs to Lodge 88, Houston; Lodge 81, Needville meeting; Czech Fest at Lodge 88, Houston; annuity training; Lodge 81, Needville meeting; board training in Austin.

Activity Report

July—Supreme Lodge meeting in Temple; Regional General Agent (RGA) meeting in Temple with RGA Lydia Talamantez; Lodge 230, Midland meeting; State Youth Achievement Day.

August—Lodge 49, Rowena meeting; meeting with member in Ballinger; SPJST Convention in Killeen; Lodge 229, Abilene meeting; virtual meeting with President/CEO Vanicek and Board of Directors.

September—Set up booth at Fair and Expo in Odessa; special called Board of Directors’ virtual meeting on annuities; set up booth at West Texas Fair and Rodeo in Abilene; meeting with church partnering on fundraiser; Lodge 230, Midland meeting.

October—Lodge 49, Rowena membership drive; helped sales agent Ralph Chalfant; meeting with RGA Lydia Talamantez.

Commentary

I would like to thank the Board of Director and Executive Officers for a good meeting. The year is looking good, but we still need to watch spending. Let’s look and see what kind of return we get on the money we spend. I would like to thank Delisle for the training and meetings he is doing - the programs he is putting together to help the agents as well as the employees in the Home Office.

I would like to thank Frank Horak for his work in the Fraternal Department. I know he does a lot and does a great job. We are on the right track, and we need to stay focused. When we meet for our planning sesCommentary

The District Five Fall Funfest was a huge success. We saw an attendance that was not seen in a long time. Lodge 88, Houston President Aaron Rigamonti and the leadership at Lodge 88, Houston are doing really well. There were people dancing around the gazebo, great music, fun, and fraternalism.

The stage sponsor fundraiser at Lodge 81, Needville filled up on sponsors in one week. The lodge’s dance floor was damaged during the freeze in February. Funds will be used for a new dance floor.

Lodge 172, Pasadena is very close to selling its building finally.

Here is what business lessons I learned from the tequila industry and how it is so similar to SPJST. I recently returned from a tequila distillery tour in the Jalisco, Mexico area. In Mexico, the tequila industry has more than 170 distilleries that generate more than 75,000 jobs mostly in the Jalisco area. They produce 375 million liters of tequila. Of that, 287 million liters are exported mainly to the United States. That generates a foreign exchange spill of $2.3 billion. All these distilleries have been in the family for many generations, and most are over 125 years old. They are run by older Hispanic men who are very much set in their ways and hate change. They want things to continue as they have been for many generations in their family and at the distillery. Machismo is the rule here, and strict standards are enforced . . . but changes are happening. The small distillers have become more adaptive and diversified.

I spoke in depth with Gilberto Sauza with Fortaleza and Felipe Camerena with G4 tequila and female owners Leticia Hermosillo with Cava de Oro and Sophia Decobecq with Calle 23 tequilas on business strategy and marketing. Most smaller distilleries have hired new, young and in many cases, female master distillers to change the flavor profile to attract young millennials and female tequila drinkers to attract new customers. Promoting family and community over profits is very important for the small local distillers. The smaller distillers offer more value even though most of the time they are not the cheapest. This is similar to the beer industry where consumers have moved from the large breweries like Budweiser, Miller Lite, and Coors, more consumers now embrace the small craft brewers, and those have taken a huge market share. The tequila industry has also seen the small distilleries thrive in the last few years with consumers preferring the smaller unique companies that meet a niche in the market.

Very similar to the tequila industry, SPJST has been around many years with a high set of standards. SPJST is also hiring younger agents and have a larger number of female agents than in the past. SPJST also now has two female directors adding a unique insight and perspective like never before. SPJST also has so much more to offer than the larger life insurance carriers. SPJST meets a niche in the life insurance industry. SPJST also highly values family and community. SPJST also adds value to its products in a highly competitive market. Fraternally, Bradley Stavinoha District Five Director

District Six Director Annie Vahalik

Activity Report

July—Fraternal Focus webcast; District Six Youth Achievement Day award presentations in Taiton; State Youth Achievement Day in Temple.

August—Delegates’ webcast; virtual orientation meeting with convention secretaries; SPJST Convention in Killeen; Lodge 41, Port Lavaca meeting and social; Lodge 8, Weimar meeting and social; virtual meeting with President/CEO Vanicek and Board of Directors; Victoria County Czech Heritage Festival Committee meeting.

September—District Six Youth outing at Camp Kubena; special called Board of Directors’ virtual meeting on annuities; Victoria County Czech Heritage Festival Committee meeting (decided to cancel festival for this year); Lodge 32, Victoria meeting and social; Lodge 28, East Bernard 50-year member presentations, fire department check presentation, meal, meeting, and social; Placedo Volunteer Fire Department check presentation; Blessing Fire Department check presentation; Bay City Fire Department check presentation; Wharton Fire Department check presentation; Lodge 151, Wharton meeting, memorial service, meal, Hungerford Fire Department check presentation, and social; Lodge 97, Placedo meeting and social; Fraternal Focus webcast.