SEATTLE CITY EMPLOYEES’ RETIREMENT SYSTEM

REQUEST FOR PROPOSAL

PRIVATE EQUITY PROGRAM MANAGER

Issued March 14, 2014

Table of Contents Item
Section One: Background, Scope, and Objective Section Two: Program Manager Profile Section Three: Program Manager Questionnaire

Page Number
5-7 8-9 10-20

Appendix
Appendix A- Required Terms of Operating Agreement Appendix B- Limited Liability Company Agreement Appendix C-Current City of Seattle Elected Officials Appendix D- Current City of Seattle Key Individuals 21-24 25-76 77-78 79-82

REQUEST FOR PROPOSAL: PRIVATE EQUITY PROGRAM MANAGER
PCA is in the process of identifying qualified organizations to provide private equity program manager services through a “Fund-of-One” limited liability company with one of our public fund clients, Seattle City Employees’ Retirement System (SCERS), located in Washington. The selected program manager will be the manager of the Fund-of-One. Please note, as of the close of business on Friday, March 14, 2014, the SCERS Board/Staff will enter into a "quiet period", during which time no Board/Staff member may knowingly have any communication with any actual or potential candidate for these services, unless authorized by the Board in connection with the due diligence process in selecting a manager. The quiet period shall cease upon the Board's entering into a contract for the private equity program manager selected. By participating in this RFP you acknowledge and agree to adhere to the Board’s “quiet period” policy. The “quiet period” restricts representatives from your firm from having any communication with the SCERS’ Board/Staff members. A violation of the quiet period rule may result in disqualification of the candidate or other appropriate Board action. We request that the completion and return of this RFP to PCA and SCERS be no later than 5:00 PM PST, Friday, April 11, 2014. If interested, please submit one (1) electronic copy via email and three (3) hard copies of the completed RFP to both:

Mr. Ryan Lobdell Senior Analyst Pension Consulting Alliance 411 NW Park Avenue, Suite 401 Portland, OR 97209 503-226-1050 ryanlobdell@pensionconsulting.com

Mr. Anthony Smith Investment Strategic Advisor Seattle City Employees’ Retirement System 720 Third Avenue, Suite 900 Seattle, WA 98104 206-615-1424 anthony.smith@seattle.gov

Complete the RFP in its entirety. Do not alter the format of this RFP.

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MINIMUM QUALIFICATIONS CRITERIA All proposals will be evaluated in two areas: 1) the Required Minimum Qualifications and 2) the Preferred Criteria, as specified below. Finalists will be selected based on responses to these two areas and to the questions in Sections Two and Three of this RFP. 1) Required Minimum Qualifications (RMQ) The Proposer Firm must meet all of the following RMQs; otherwise its proposal may be rejected. For each RMQ, the Proposer must provide a detailed response (one sentence or more) stating how the Proposer has met the RMQ as of December 31, 2013. A response that is limited to a mere reference to other sections of the RFP will be insufficient. Any known deviations from the RMQs below must be disclosed in detail on this form.           The Proposer Firm must have been in existence for at least five (5) full years. The Proposer Firm must have at least five years of experience in providing private equity program management services in a separate account or equivalent format. The Proposer Firm must be registered with the Securities and Exchange Commission (SEC), a Bank, or a licensed Insurance Company Affiliate. The Proposer Firm must not have been censured by the SEC nor subject to regulatory action within the last five (5) years. The Proposer Firm will act as a fiduciary of SCERS and comply with City of Seattle and State of Washington requirements as indicated in Appendix A of this RFP. The Proposer Firm must complete the RFP questionnaire in its entirety. The Proposer Firm must have at least three existing U.S. based, tax-exempt clients utilizing private equity program services in a separate account or equivalent format. The Proposer Firm must have as private equity program separate account clients at least two public pension funds with total portfolio assets in excess of $2 billion. The Proposer Firm must have at least $1 billion of committed capital in private equity separate account or equivalent mandates. The proposed lead relationship professional for this engagement must have at least ten (10) years of experience in providing private equity program services to public pension funds.

Certification By signing below, an authorized representative of the Proposer warrants that the Proposer meets all of the REQUIRED MINIMUM QUALIFICATIONS.

Authorized Signature

(Print Name)

Title Company

Date

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2) Preferred Criteria (PC)

The following PCs are strongly desired by SCERS. Although failure to meet one or more of the PCs may not necessarily result in disqualification, Proposer Firms who fail to meet one or more of the PCs may be considered less favorably in the selection process. Please provide a detailed answer for each of the PCs (one sentence or more). Please do not only refer to other sections of the RFP. Any known deviations from the PCs below should be disclosed in detail on this form.   The Proposer Firm should not have been involved in any material litigation in the past five (5) years. The Proposer Firm’s signatory should be directly responsible for the management of the SCERS account, and all personnel responsible for the account must be employees of the firm. The Proposer Firm should have an established presence in both U.S. and non-U.S. private equity markets, including established office(s) and personnel in non-U.S. locations. Results of a composite containing the above programs should have, on average, exceeded the performance of the top-quartile benchmark as represented by Thompson Venture Economics (or equivalent), over the five-year and eight-year periods ended 12/31/13.

 

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REQUEST FOR PROPOSAL Private Equity Program Manager (Program Manager) SECTION ONE: BACKGROUND The Seattle City Employees’ Retirement System (SCERS) is a public defined benefit pension plan that covers most employees for the City of Seattle. It does not cover police officers or fire fighters. The system had assets of approximately $2.2 billion as of December 31, 2013. SCERS is overseen by a seven member Board of Administration (the “Board”) consisting of elected and appointed members chaired by the Chair of the City Council’s Finance and Culture Committee. SCERS’ current asset allocation plan is as follows: BACKGROUND, SCOPE, AND OBJECTIVE

Total U.S. Equity Traditional U.S. Equity Low-volatility U.S. Equity Non-U.S. Equity Fixed Income Real Return Private Equity Real Estate

25% 15% 10% 26% 20% 9% 7% 13%

The long-term strategic allocation to Private Equity of 7% of total pension portfolio assets was adopted by the Board in November, 2013. Currently, the actual allocation to legacy private equity investments amounts to approximately 2%. Therefore, over the next several years, SCERS seeks to grow its Private Equity program towards its target allocation level. Based on normal expectations for SCERS’ overall total portfolio over the next several years, the Private Equity class needs to grow to approximately $200 million by mid-2018 in order to achieve its long-term 7% allocation level. To facilitate this effort, through this RFP, SCERS seeks to retain one (1) Private Equity Program Manager to develop and manage the program. As part of this mandate SCERS also expects the Private Equity Program Manager to manage, monitor, and oversee SCERS’ existing private equity portfolio. Depending on the success of the program’s implementation over time, SCERS reserves the right to modify the program and/or engage additional program managers. SCERS would like proposals for both “fully discretionary” and “discretionary with veto” arrangements for a “Fund-of-One” limited liability company with the program manager acting as the manager and committing approximately one percent (1%) of overall commitments to the company. “Discretionary with veto” proposals should be prepared with the expectation that SCERS would exercise any veto rights rarely, if at all. Firms responding to this RFP should clearly identify the differences between their proposals for “fully discretionary” and “discretionary with veto” both operationally and relative to fees and other charges. SCERS expects to negotiate a limited liability company operating agreement based on its draft agreement in Appendix B. The final agreement will include all of the required terms set forth in Appendix A.

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SCOPE OF WORK The program manager is expected to provide expert services in the development, implementation, management and administration of the SCERS private equity investment related activities. Expected specific services include: 1. Structure a “best of breed” private equity program with SCERS. This includes developing an ”Investment Plan” which includes formulating an overall investment strategy appropriate for SCERS; cash flow forecasting and investment pacing; devising annual tactical plans which include sector allocations and return objectives; creating reporting and monitoring guidelines; and other related activities. Proposals should reflect how the Investment Plan will be updated to ensure that the private equity program best meets SCERS’ on-going needs. Prior to making individual investments, the program manager shall describe the appropriateness of the investment for SCERS and its consistency with the Investment Plan. 2. Serve as the investment adviser and manager. This includes performing due diligence on potential investments, performing legal reviews for and negotiating and entering into all contractual agreements for each of the Fund-of-One’s investments, representing the best interests of SCERS through advisory committee seats and participating in any votes for the underlying investments, preparing all necessary and customary financial reports for the partnership and otherwise ensuring that all compliance responsibilities are performed, performing fee verification, placing capital, ensuring that all capital calls, distributions, etc. are made in a timely and accurate manner, and performing other customary back office functions. 3. Supply on-going monitoring, reporting, performance measurement, and attribution analysis for each of the various investments in the private equity program. This includes periodic in-person presentations and updates to staff and board members. It is expected that the selected program manager will appear before the SCERS investment committee at least semi-annually to discuss performance and other relevant issues. Additional appearances may be required at the discretion of SCERS. The selected program manager will provide SCERS and its general investment consultant with: detailed performance and holding reports on a quarterly basis; forward-looking commitment projections, capital call projections, and distribution projections for the program and for each partnership investment, on at least a semi-annual basis; private placement memorandum, subscription documents, and other relevant signed legal documents pertaining to each partnership commitment in the SCERS program; annual financial statements to include marked-to-market investment valuations as appropriate for the private equity asset class.

4. Assist with reconciling all portfolio holdings and transactions with SCERS’ custodian bank (BNY Mellon). 5. Outline and develop a programmatic private equity knowledge-transfer process with SCERS staff. This may include sharing due diligence reports, inviting staff to attend due diligence and monitoring visits, sharing investment reports, etc. 6. Educate and present topical research regarding private equity market conditions, opportunities, trends and other relevant subjects to staff and board members. 7. If a “discretionary with veto” arrangement is chosen, work with SCERS staff to develop and execute a staff-driven exception-based partnership selection veto procedure.

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PROGRAM OBJECTIVES AND STRUCTURE The investment objective is to achieve consistent top-quartile private equity returns while providing diversification to other asset classes. Additionally, the program manager is expected to achieve, over the course of a manager’s term, the following:   An annualized dollar-weighted internal rate of return (net of fees and expenses) in excess of 3% above the Russell 3000 Index return. An annualized dollar-weighted internal rate of return and return on invested capital multiple (net of fees and expenses) in excess of top-quartile benchmark represented by Thompson Venture Economics, on a comparable vintage year basis.

The duties of the selected program manager will be to create and manage a fully diversified portfolio of underlying private equity partnerships based on the following general investment guidelines:  The portfolio can include direct partnership interests, fund-of-funds, co-investments, and secondary interests in the following segments within the approved range:     Leveraged Buyout (50-85%) Venture Capital (5-15%) Debt Related (5-20%) Other (i.e. Special Situations, Natural Resources, etc.) (0-15%)

The program manager may provide additional input into these allocation ranges. SCERS may entertain adjusting these ranges, based on analysis provided by the program manager.  Diversification within the Private Equity portfolio is critical to control risk and maximize returns. The specific investments shall be aggregated, evaluated, and monitored to control unintended biases. Diversification can occur across the following parameters.     Market Segment Vintage Group Economic Sector Geographic Location – The current program is primarily focused in the US; however, it is anticipated other geographies will be considered.

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SECTION TWO: PROGRAM MANAGER PROFILE Please retain the format of this document. This document is not to exceed five (5) pages.

____________________________________ Proposer Firm Name AS OF QUARTER ENDING DECEMBER 31, 2013 Proposed Strategy Describe the service and strategy you are proposing to SCERS. Describe how your offering will provide SCERS with a well-diversified private equity program and meet SCERS’ risk/return expectations for the asset class. Please also include the sub-asset class allocations you propose for the fund.

Firm Philosophy Describe your firm philosophy and approach to private equity, as it applies to SCERS’ total portfolio, broad asset allocation targets, alternative investments, risk, and return.

Investment Process Describe your process including selection of managers, portfolio construction, and risk controls.

Unique Attributes/Competitive Advantage Relative to Peers Describe the characteristics of your firm that distinguish your firm from your competitors.

Biographies of Key Personnel Include brief biographies of the lead investment professionals and other key professionals that your firm will assign to SCERS’ account.

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Contact Information Provide the name, address, telephone number, fax and e-mail address of the designated person responsible for answering questions regarding the RFP. Also include the name, title, telephone, fax number and email of one lead investment professional and one key professional employee responsible for the SCERS account. Please also include relevant web addresses for the firm.

Contact ( Person Preparing RFP Response): Address: Phone Number: Facsimile Number: Email Address:

Contact (Lead Investment Professional): Title: Phone Number: Facsimile Number: Email Address:

Contact (Key Professional Employee): Title: Phone Number: Facsimile Number: Email Address:

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SECTION THREE: PROGRAM MANAGER QUESTIONNAIRE The proposer should respond to all questions 1-85, as of March 14, 2014.

Firm Information

1.

Provide the following information on the firm:

1. Type of firm (i.e. corporation, public, private, partnership, etc.) 2. Name of Parent (or equivalent) 3. Year firm was established: 4. Year established private equity investment group 5. Year private equity group first implemented (execute GP commitments) for separate account private equity clients 6. Year firm became SEC registered 7. # of firm employees (in total) 8. # of investment professionals (in total) 9. # of private equity professionals 10. % of firm owned by employees 11. # of employees with ownership stake 12. Location (City) and (State)

2. 3.

Provide a brief history of your private equity group managing the investments for institutional clients. List the location(s) of your headquarters and branch offices. State the primary function of staff (i.e. Investment Consultants, Marketing, Operations) and number of staff in each office. Location Primary Function of Staff Total # of Staff Investment Staff P/E Staff

Main Headquarters: Branch Office (1): Branch Office (2):

4.

Provide an organizational chart of the firm, depicting parent, subsidiary, and affiliate organizations, and divisions/ departments. Do you subcontract or outsource any parts of your program manager business? If yes, please describe in detail which parts are performed externally and the reason for doing so. Please provide the names(s) of the providers, their office location, how long they have been in business, and the qualifications of the specific people who will be working with SCERS. Describe any changes in your organizational structure in the last five (5) years, including new business ventures.

5.

6.

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7. 8. 9.

Does your firm anticipate any major organizational changes or structural changes within the firm in the foreseeable future? Provide an outline of your firm’s succession plan. Explain your firm's goals and plans for expansion, particularly how such goals may pertain to accepting new client business.

10. Provide a schedule detailing the amount of ownership in the firm by employees and third parties. Name/Company Relationship to firm (if any) % Owned

11. Provide a copy of your most recent Form ADV (Part I & II).

Risk and Transparency

12. Describe the business continuity plan your firm has in place in order to permit it to continue to deliver the services described in this RFP and to preserve all associated electronic and written records, in the case of a disaster. 13. Please answer the following questions in regards to your firm: a. Is there any pending or threatened litigation against your firm of any type (civil, criminal, regulatory, arbitration, mediation or other) or has your firm been involved in any such litigation within the last five years? If yes, please explain. b. Is your firm under investigation by any federal, state, local or foreign regulatory body of any type (e.g., real estate commission, NASD, SEC or attorney general)? c. Has your firm entered into any settlement, consent decree, cease and desist order or other similar agreement of any kind? 14. Over the past five (5) years, has any officer or principal of your firm been involved in any litigation, claim, charge or other legal proceeding relating to his or her private equity management activities, other investment management activities or the integrity, character or honesty of such individual? If so, provide a brief explanation and indicate the current status. 15. Detail any existing or potential conflicts between your firm’s private equity management servic es, other services performed for clients, personal (or employee) investment activity and other current or potential relationships. Will the firm contractually agree to continue to disclose all potential and actual conflicts of interest on an on-going basis, and will it annually disclose all sources of firm revenue and all business relationships and affiliations? 16. Does your firm (or any subsidiary) provide to public or private funds services other than those you are proposing in this document as a Manager? ___ Yes or ___ No? If yes, please explain. 17. Does your firm, its principals, or any affiliate, own any part of a money management firm, brokerdealer or other organization that sells services to institutional investors and/or SEC registered investment advisors? If so, identify the firm(s) and describe the relationship. 18. Please list all investment, consulting, and/or advisory firms from which your firm, its principals, or any affiliates receive compensation. Please identify these revenues sources as client directed, payment for services, and/or revenues not related to a letter of direction or specific services.

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19. Describe any fidelity bonds, errors and omissions coverage and any other fiduciary coverage, which your firm carries. List the insurance carriers supplying the coverage. 20. If your firm maintains errors and omissions insurance or any fiduciary or professional liability coverage, have any claims been filed in the last five years? If so, provide an explanation.

Professional Staff

21. Provide a staff organization chart showing functions, positions, and titles of all professionals in your organization. (Chart should identify relevant positions within the organization of those involved in program manager services). 22. List all lead investment professionals, key professional employees, and others who will represent the firm and be assigned to this account. This includes all individuals of affiliate groups that will work on this account. 23. Discuss the procedures for managing the loss of any of the key investment professionals assigned to this account. 24. Provide the year and role of any investment professionals that have been gained or lost in the last five (5) years. Name Title Role Tenure Arrival Date Departure Date Reason for Departure

25. Describe any specific programs for keeping valued employees. Include a discussion of the relative emphasis on various long-term compensation vehicles such as cash/deferred bonuses, firm equity, and employee co-investments alongside client investments. 26. Describe employee co-investment programs, including requirements for participation, relative level of participation, and any financing programs.

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Assets Under Management

27. Complete the charts below and enter asset values to the nearest million.
Calendar Year End Total # of Accts Assets Total Discretionary* Commingled FoFs Separate Accounts # of Committed Invested # of Committed Invested Accts $ $ Accts $ $ Total Non-Discretionary # of Accts Committed $ Invested $

2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 *Include “discretion-in-a-box” mandates.

28. Please complete the following table. Proportion of Firm Revenues, as of 12/31/2013 NonDiscretionary* Discretionary Consulting Services Asset/Fund Management Services Total (in %)
*Include “discretion-in-a-box” mandates.

Total

100%

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29. Provide the following as of 12/31/13. Firm Assets ($mil) Total Assets Total Institutional Assets US Tax Exempt US Taxable By Client Type Corporate Public Fund Union/Multi-Employer Foundation & Endowment Health Care Insurance High Net Worth Wrap Accounts Sub-Advisor Other Institutional Private Equity Committed Invested Capital Capital ($mil) ($mil)

# of Accounts

# of Accounts

30. Please provide at least five (5) separate account client firm references, at least three (3) of which are institutional, that SCERS can contact. The reference should have been a client for at least three years. Include at least one non-ERISA (endowment, foundation, high net-worth, etc.), two public fund clients, and one corporate client. Please indicate the private equity assets under management (AUM) in millions. Also, include the firm address, contact name, title, phone number, and e-mail address. Client Firm for # of Years

Client Firm Name

$AUM

Firm Address

Contact Name and Title

Phone

E-mail

1. (Non-ERISA Client) 2. (Public Fund Client) 3. (Public Fund Client) 4. (Corporate Client) 5. (Institutional Client)

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31. Provide a list of clients gained and/or lost during the past five years. Indicate the size of the fund and the reason for ending the relationship. Client Date of Hire Date of Termination Size of Fund Reason

32. Please provide at least two (2) former separate account client firm references, having the characteristics similar to those under Question 30 above. Please indicate the private equity assets under management (AUM) in millions. Also, include the firm address, contact name, title, phone number, and e-mail address. Client Firm for # of Years

Former Client Firm Name 1. (Former Client) 2. (Former Client)

$AUM

Year Relationship Ended

Firm Address

Contact Name and Title

Phone

E-mail

Private Equity Investment Implementation

33. Discuss the account structure you propose for SCERS. 34. Fully describe the nature of the customization you can offer. 35. Please outline your approach to managing a partnership selection process where staff retains veto rights over prospective partnership investments. SCERS expects that it would exercise such veto authority on under only rare and unique circumstances. 36. Disclose any barriers or foreseen circumstances where you may find it difficult to implement any of the above. 37. Describe how your firm is prepared to work with SCERS and coordinate with its primary general investment consultant. 38. Describe your process and methodology for recommending modifications to the private equity asset class and portfolio reconfiguration as warranted by changes in the private equity market or overall strategy. 39. Discuss your firm’s policy for allocating commitments among client accounts. Include discussion regarding allocation among discretionary vs. non-discretionary accounts as well as commingled funds vs. separate accounts. Attach a copy of your firm’s allocation policy. 40. Describe risk monitoring and risk budgeting methodologies employed in your process.

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41. List and describe the legal services you will provide in response to the scope of service requirements. Indicate if these services are performed by staff from your firm and/or if outside legal counsel is retained. Please provide bios and relevant experience of key legal professionals that may be utilized for the SCERS account whether employed by your firm or by an external provider. Please provide one or more samples of recent partnership legal reviews. 42. Include in your description your firm’s process for handling negotiations regarding fees and partnership terms. Describe the individuals in the process and whether or not outside counsel is involved in the negotiation. 43. Describe your firm’s system for tracking prospective investments. Identify if this is a proprietary or non-proprietary system. Include a discussion of the following: managers, products, universes, and years of performance data. 44. Describe your ability to invest the client’s account with top -tier partnerships, which are normally inaccessible to new investors. What part of the portfolio would be with top-tier general partners vs. partnerships openly seeking funds? 45. What is your policy on investing in smaller (below $200 million) or first-time funds for clients such as SCERS? 46. Explain the process for the termination of a private equity investment and how your firm manages the dissolution of investments, if necessary and feasible. 47. See SCERS investment management agreement (Appendix A). Do you have any concerns? If so, please describe. 48. Please provide a sample client portfolio that your firm is managing that is of similar size to SCERS’ long-term target level ($200M in market value). Please list the partnerships the portfolio has exposure to as follows: Partnership Name Commitment Amount $ (millions) Investment Value ($) Vintage Year Sector

Separate Account Administration, Oversight, Monitoring, and Reporting

49. Describe how you would handle the back office functions for managing a private equity mandate on behalf of SCERS including capital calls, distributions, financial statements, and custodian interaction. Are there any additional costs associated with this service? 50. Describe an account structure that includes managing capital calls, distributions, financial statements and custodian interaction. 51. What is your experience in consolidating capital calls and/or distributions for your clients on a monthly or quarterly basis? 52. Describe any GP asset/valuation verification engaged in by your firm.

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53. Describe your GP financial reporting requirements and your procedure for reconciling the valuation of each underlying investment. 54. Describe your procedure for reconciling each underlying investment capital commitments, paid in capital, invested capital, distributions, expenses, management fees, and cash. 55. Identify the standard reports SCERS can expect to receive on a quarterly, semi-annually, and/or annual basis. Provide the timing (days after period end) by which SCERS can expect to receive these reports. 56. How do you modify your reports for clients subject to FOIA requirements – what level of information is provided and what is specifically excluded? Please attach a sample of the yearend portfolio reports you prepare for FOIA clients. 57. Explain your views on risk and transparency. For an institutional size investor such as SCERS, what do you expect to be disclosed to you and what do you expect to be disclosed to SCERS, with regards to the private equity investment? 58. List the reports we can expect to receive from your firm related to risk and transparency. 59. Who are the accountants for your firm? 60. How often is your firm, its funds, and accounts audited? 61. Provide a listing of the auditors for your firm in the last five years. 62. Provide a listing of the legal advisors for your firm in the last five years. 63. List other independent service providers or contractors your firm may use, in relation to the services you propose for SCERS. Performance Data 64. As Exhibit A to this questionnaire, using the provided Excel spreadsheet, detail your firm’s historical performance data for private equity assets under management. Returns are to be presented both gross of fees and net of fees for all applicable vintage years and must include annual and cumulative return data. Provide separate performance data for Fund-of-Fund accounts (includes commingled funds) and for separate account returns.

Exhibit A

65. Do you claim that the data presented in Question 62 IS GIPS compliant? If so, please answer the following questions:
a) b)

How many years has your firm been GIPS compliant? Has your firm been verified? Please specify the verifier and provide a verification letter.

66. If the data presented in Question 62 is NOT GIPS compliant, please answer the following questions: a) Do the returns gross of fees include any fees or expenses? If so, please provide details of any expenses that are deducted.

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b) Please provide a description of the fees and expenses that are deducted in the returns net of fees. Are there any additional costs, fees, or expenses incurred by clients which are not included in the net of fees’ returns? c) Is there a minimum asset level below which accounts are not included in the composite returns? If so, what is that level?

Pay-to-Play

67. Does your firm utilize/compensate one or more external placement agents in any of your institutional investment offerings? If so, please provide details on (i) how much assets and under what mandates the placement agent(s) was/were utilized and (ii) the compensation structure agreed upon between your firm and each placement agent (iii) in what capacity they are used in relation to this private equity program. 68. Has your firm paid any unregistered third-parties such as placement agents to solicit government business? 69. Has any current or former SCERS Board Members, SCERS employees, or SCERS consultants suggested the retention of a placement agent? If so, please disclose the names of these individuals. 70. If retained for this mandate, will your firm utilize/compensate an external placement agent? If so, please provide:
a)

A written statement of whether the Manager or any of its principals, employees, agents or affiliates has compensated or agreed to compensate any person or entity to act as a Placement Agent in connection with the System’s investments. The name of the Placement Agent, and resumes of every officer, partner and principal of the Placement Agent. The resumes shall include educational history, professional designations, regulatory licenses and investment and work experience. Description of any and all compensation paid or agreed to be paid to the Placement Agent, including payment to employees of the Manager who are retained in order to solicit, or who are paid based in whole or in part upon, an investment from the System. Description of the services rendered or the services expected to be performed by the Placement Agent and a list of the prospective clients for which such Placement Agent is utilized. Copies of all agreements between the Manager and the Placement Agent. Name of the regulatory agencies the Placement Agent or any of its affiliates are registered with, such as The Securities and Exchange Commission (SEC), the Financial Industry Regulatory Association (FINRA), or any similar regulatory agency; proof and details of such registration shall be included, or an explanation as to why no registration is required.

b)

c)

d)

e) f)

71. How does your firm monitor the use of external placement agents at the partnership level? What is your firm’s placement agent policy with regard to partnerships? Please provide a copy. 72. Does your firm have placement agent-usage/disclosure policies at the partnership consideration level? If so, please describe. 73. Please provide a listing of all partnerships your firm committed assets to over the last three years that utilized placement agents.

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74. Has your firm, any employees of your firm, or any associate of your firm made any campaign contribution to any of the elected officials in Appendix C? 75. Has your firm, any employees of your firm, or any associate of your firm coordinated or solicited any person or political action committee to make any campaign contribution to the elected officials in Appendix C in the last two year period? Miscellaneous

76. If retained for this mandate, would the program manager or product specialist be willing to meet in SCERS offices in Seattle, WA at least semi-annually? 77. Describe your firm’s relationship with SCERS staff as the private equity program evolves? What functions/investment activities would you envision SCERS’ having a key role in? How will your firm educate and train SCERS staff regarding these functions/investment activities? 78. Does your firm envision SCERS staff playing a role in the due diligence process? Please describe. 79. Have any past or current clients evolved their private equity programs to shift a portion of the investment activities (i.e., partnership sourcing, partnership due diligence and selection, portfolio structuring, back-office function, portfolio monitoring, etc.) in-house? Please describe. 80. Please include no more than one sample of a white paper or other short research communication provided to your clients on private equity. 81. Discuss any FOIA-related issues you may have regarding providing investment access to partnerships for SCERS. 82. As a supplemental Exhibit to this questionnaire, include any other information that your firm believes is pertinent to this RFP, but not specifically requested anywhere else in this Request for Proposal. 83. Please describe your approach to working with SCERS to manage, oversee, and potentially wind-down, SCERS’ existing legacy investments. 84. Please disclose to the best of your knowledge, the Proposer Firm’s business interests or relationships with (i) any City of Seattle officer or employee who was, is or will be involved in the selection of the program manager; or (ii) any of the individuals in Appendix D including (1) a current SCERS Board Member or any person who had been a SCERS Board Member within the last five years, (2) a SCERS employee in a position of management, (3) a SCERS consultant, (4) a current or former elected official of the City of Seattle that has served in such position within the last five years, or (5) a current department head of the City of Seattle. As used in this section, the term “Proposer Firm” shall include any employee of the firm who was, is or will be involved in the preparation of the firm’s proposal, or in the negation, execution, administration or performance of any resultant agreement.

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Program Fee Proposal and Related Costs

85. Provide your cost/fee proposal/schedule for the Private Equity Program Services described in the Scope of Work. Your proposal should include all services, including the use of any potential services outsourced by your firm. Please provide, if appropriate, separate cost/fee proposals for the fully-discretionary and discretionary-with-veto mandates. If your fee/cost proposal is the same under both mandates, then please so indicate. 86. Please provide a year-by-year preliminary $-cost estimate of the underlying partnership-level costs/charges (including any carried interest) associated with a program of SCERS’ scale and maturity for the first five years.

Please provide the following documents with your response:      

Form ADV Parts I & II Annual Report / Audited Financials Code of Ethics Trading/Investment Policies for Firm Personnel Sample Client Reporting Materials as of 12/31/13 Product Pitch book Sample Partnership-level due diligence documentation

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APPENDIX A

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Appendix A
REQUIRED TERMS OF OPERATING AGREEMENT

The proposer firm must agree to the following with respect to the Operating Agreement of the Fund-of-One (a draft form of which is attached as Appendix B): 1. The Agreement will include the following language provided in Section 5.2(a) and (b) of regarding fiduciary duties: 5.2 Fiduciary Duties; Conflicts of Interest. (a) The Manager hereby acknowledges that (i) the assets that are invested in the Company by SCERS are held in trust for the exclusive benefit of the members of SCERS and their beneficiaries; (ii) the Manager is a fiduciary with respect to the members of SCERS, their beneficiaries, and the Company, (iii) the Manager shall comply with applicable law and the standards of fiduciary responsibility set forth in Revised Code of Washington § 35.39.060, (iv) the Manager shall discharge its duties under the Agreement solely in the interest of, and for the exclusive purpose of providing benefits to, the members of SCERS and their beneficiaries and defraying reasonable expenses charged to SCERS, and (v) the Manager shall cause the Key Persons to act in accordance with such fiduciary duties. (b) In furtherance of Section 5.2(a), the Manager shall perform its obligations under this Agreement 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 management of an enterprise of like character and with like aims, and the Manager shall comply with the requirements of this Agreement for managing Conflicts and allocating investment opportunities. 2. The Agreement will include the following language provided in Section 8.8 regarding confidential information and public disclosure laws: 8.8 Confidentiality. (a) Except as otherwise provided in this Section 8.80, the parties may use Confidential Information solely for purposes related to the Company and no other purpose whatsoever, and shall keep it strictly confidential and not disclose it to any Person, except (i) Persons who need to know the Confidential Information solely for purposes of the Company and who acknowledge the confidential nature of the Confidential Information and agree to maintain its confidentiality as if they
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were subject to this Agreement, and (ii) disclosures of Confidential Information required by law or legal process. (b) The Manager acknowledges that SCERS is a public agency subject to state laws, including, without limitation, the Open Public Meetings Act (contained in Chapter 42.30 Revised Code of Washington) and the Washington State Public Records Act (contained in Chapter 42.56 Revised Code of Washington) (the “Public Records Act”), which provides generally that all records relating to a public agency’s business are open to public inspection and copying unless exempted under the Public Records Act, and that, as a result, SCERS may be required to disclose certain Confidential Information to the public. The Manager acknowledges that all writings, which include all means of recording any form of communication or representation, provided by the Manager to SCERS become public records and may be subject to public disclosure under the Public Records Act, notwithstanding that the Manager has designated information in such records as confidential. The Manager agrees that SCERS is permitted to disclose Company Level Information and Portfolio Level Information and that such disclosure shall not constitute a breach of the Agreement. (c) In the event SCERS receives a request to disclose Confidential Information, SCERS shall use reasonable efforts to (i) promptly notify the Manager of such information request, (ii) promptly provide the Manager with a copy of such information request or a summary of the information being requested and the timing for responding, and (iii) provide the Manager a reasonable opportunity to seek appropriate legal action regarding such disclosure, if any. Neither the Manager nor any party associated with the Manager in connection with the Agreement shall make any claim against SCERS if it makes available to the public any Confidential Information that SCERS determines in good faith is required to be made public pursuant to the Public Records Act or any legal proceeding, and SCERS shall not be liable to the Manager or any third party for such disclosure. (d) Any acknowledgement or agreement concerning the disclosure or confidentiality of information, or the use thereof, that is required as a condition to gaining access to any website on which Company documents or reports are made available or delivered under this Agreement shall be subject to (and superseded by) the terms of this Agreement.

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3.

The Agreement will include the following language provided in Section 9.3(a): 9.3 Removal of Manager. (a) (SCERS shall have the right, at any time and in its sole discretion to remove the Manager at any time without cause, by giving ______________ (_____) days written notice (“No Fault Removal”). During such ________ day period, the Company shall not make any new Company Investments other than completion of transactions with respect to which the Company had made a binding commitment to invest as of the date notice of removal was given to the Manager or Company Investments otherwise approved by SCERS (and, for the avoidance of doubt, the Company may satisfy Company obligations to existing Portfolio Funds). The No Fault Removal shall be effective at the end of the _______ day period.

4.

The Agreement will not obligate SCERS to indemnify the Manager or the Company, and will not obligate the Company to indemnify the Manager, in connection with the Manager’s activities on behalf of the Company and SCERS.

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APPENDIX B

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[SEATTLE FUND], LLC

LIMITED LIABILITY COMPANY AGREEMENT

Dated as of __________, 2014

TABLE OF CONTENTS Page SECTION 1. SECTION 2. 2.1 2.2 2.3 2.4 2.5 2.6 2.7 2.8 SECTION 3. 3.1 3.2 3.3 DEFINITIONS. ............................................................................................... 29 ORGANIZATION. ......................................................................................... 37 Formation of Limited Liability Company............................................................. 37 Name ..................................................................................................................... 38 Objectives of the Company................................................................................... 38 Principal Place of Business ................................................................................... 38 Specified Office and Agent for Service of Process in Washington ...................... 38 Fiscal Year ............................................................................................................ 38 Manager ................................................................................................................ 38 Members’ Capital Commitments .......................................................................... 38 CAPITAL CONTRIBUTIONS; MEMBERS’ ACCOUNTS; ALLOCATIONS. ........................................................................................... 39 Capital Contributions of the Members .................................................................. 39 Available Capital .................................................................................................. 39 Capital Accounts ................................................................................................... 39
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3.4 Defaulting Member ............................................................................................... 40 3.5 Reserve .................................................................................................................. 41 SECTION 4. COMPANY DISTRIBUTIONS. .................................................................... 42 4.1 4.2 4.3 4.4 4.5 4.6 SECTION 5. 5.1 5.2 5.3 5.4 5.5 5.6 5.7 SECTION 6. 6.1 6.2 6.3 6.4 6.5 SECTION 7. Withdrawal of Capital ........................................................................................... 42 Distributions.......................................................................................................... 42 Final Distribution and Manager Clawback ........................................................... 43 Tax Distributions .................................................................................................. 44 Valuation ............................................................................................................... 44 Withholding Taxes ................................................................................................ 45 MANAGEMENT. ........................................................................................... 46 Powers and Duties of Manager ............................................................................. 46 Fiduciary Duties; Conflicts of Interest .................................................................. 22 Investment Management ....................................................................................... 48 Commitment of Resources; Other Business Relationships .................................. 50 Additional Obligations of the Manager ................................................................ 51 Suspension Events ................................................................................................ 51 Investment Vehicles .............................................................................................. 52 LIABILITY OF MEMBERS. ........................................................................ 53 Liability of Manager, etc....................................................................................... 53 Liability of Members ............................................................................................ 53 No Obligation to Replenish Negative Capital Account ........................................ 54 Return of Distributions ......................................................................................... 54 Not Liable for Return of Capital ........................................................................... 54 EXPENSES; MANAGEMENT FEE............................................................. 54

7.1 Management Fee ................................................................................................... 54 7.2 Expenses ............................................................................................................... 54 SECTION 8. BOOKS AND RECORDS; REPORTS TO MEMBERS. ........................... 55 8.1 8.2 8.3 8.4 8.5 8.6 8.7 8.8 SECTION 9. Books and Records ............................................................................................... 55 Tax Information .................................................................................................... 55 Tax Matters Partner............................................................................................... 56 Reports to Members .............................................................................................. 56 Meetings ................................................................................................................ 57 Section 754 Election ............................................................................................. 58 Compliance with Law ........................................................................................... 58 Confidentiality ...................................................................................................... 22 TRANSFERS, ETC......................................................................................... 59

9.1 Transfer by Manager ............................................................................................. 59 9.2 Withdrawal of Manager ........................................................................................ 59 9.3 Removal of Manager............................................................................................. 59 9.4 Transfer by Members ............................................................................................ 60 9.5 Certain Restrictions on Transfers.......................................................................... 60 9.6 Further Actions ..................................................................................................... 61 SECTION 10. DURATION AND TERMINATION OF THE COMPANY. ...................... 61 10.1 Duration ................................................................................................................ 61
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10.2 Winding Up ........................................................................................................... 61 10.3 Final Distribution .................................................................................................. 61 10.4 Termination ........................................................................................................... 61 SECTION 11. REPRESENTATIONS AND WARRANTIES. ............................................ 62 11.1 Representations and Warranties of the Company ................................................. 62 11.2 Representations and Warranties of the Manager .................................................. 62 11.3 Acknowledgments, Representations and Warranties of the Members ................. 65 SECTION 12. MISCELLANEOUS. ...................................................................................... 69 12.1 Waiver of Partition ................................................................................................ 69 12.2 Modifications ........................................................................................................ 69 12.3 Entire Agreement .................................................................................................. 70 12.4 Severability ........................................................................................................... 70 12.5 Notices .................................................................................................................. 70 12.6 Governing Law ..................................................................................................... 71 12.7 Successors and Assigns......................................................................................... 71 12.8 Counterparts .......................................................................................................... 71 12.9 Headings ............................................................................................................... 71 12.10 Actions and Power of Attorney............................................................................. 71 12.11 Pronouns and Plurals............................................................................................. 72 12.12 Non Waiver ........................................................................................................... 72 12.13 Construction .......................................................................................................... 72 12.14 SCERS’ Opinion of Counsel ................................................................................ 72 12.15 Prohibited Investment ........................................................................................... 73 SECTION 13. COMPANY ALLOCATIONS ....................................................................... 73

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This LIMITED LIABILITY COMPANY AGREEMENT of SEATTLE FUND, LLC, a Washington limited liability company (the “Company”), is made as of this ______________, 2014, by and among the Company, [Manager] (together with its successors and assigns permitted hereunder, the “Manager”), and the Seattle City Employees’ Retirement System (“SCERS”). DEFINITIONS. As used herein, the following terms shall have the following meanings: Act: The Washington Limited Liability Act, RCW §§ 25.15.005, et seq., as amended from time to time. Advisers Act: The Investment Advisers Act of 1940, as the same may be amended from time to time. Affiliate: As to any Person, any other Person directly or indirectly controlling, controlled by, or under common control with, such Person; and with respect to the Manager, Affiliates shall include the Key Persons. For the avoidance of doubt, SCERS is not an “Affiliate” of the Manager or any ______________ Entity. Agreement: This Limited Liability Company Agreement between the Manager and the Members, as may be amended or restated from time to time. Allocation Policy: As defined in Section 0. Annual Financial Statements: As defined in Section 0. Assumed Income Tax Rate: The highest effective marginal combined federal, state and local income tax rate for a Fiscal Year prescribed for any individual resident in ____________ (taking into account the character of the income and deductibility of state and local income taxes for federal income tax purposes); provided, however, that the Assumed Income Tax Rate shall be deemed to be zero with respect to any allocations of income or gain, to the extent such income or gain would be offset by carry forwards of allocations of items of loss or expense from the Company for prior Fiscal Years not yet taken into account pursuant to this proviso, assuming that the Manager is an individual resident in ____________ whose only tax items consisted of allocations from the Company; and provided further, however, that if the aggregate state and local income tax rate for a resident of any state and locality in which the Company has an office is greater than the rate otherwise applicable to an individual resident in ____________ as otherwise provided herein, such greater state and local tax rate shall be utilized for purposes of determining the state and local portion of the Assumed Income Tax Rate to the extent of any income associated with such office. Base Rate: The rate from time to time announced by ____________ as its prime or base rate.

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Business Day: Any day other than a Saturday, Sunday, a bank holiday in the State of Washington or other day that is considered a holiday for the employees of the State of Washington. SCERS: As defined in the first paragraph of the Agreement. Capital Account: As defined in Section 0. Capital Commitment: As to any Member, such Member’s Capital Commitment as set forth in Section 0 and on Schedule 2.8, as amended from time to time. Capital Contribution: As to any Member, the capital contributed to the Company by such Member pursuant to Section 0. Carried Interest: The Manager’s right to Distributions as provided in Section 0(B). Carrying Value: With respect to any Company asset, the asset’s adjusted basis for U.S. federal income tax purposes, provided that the Carrying Values of all Company assets shall be adjusted to equal their respective Fair Market Values as of the following dates: (a) the date of the acquisition of any additional Interest by any new or existing Member in exchange for more than a de minimis Capital Contribution other than pursuant to the initial closing of the sale of Interests; (b) the date of the distribution of more than a de minimis amount of Company property to a Member as consideration for an Interest in the Company; or (c) the date an Interest is relinquished to the Company. All such adjustments shall be made in accordance with the rules set forth in Treasury Regulations Section 1.704-1(b)(2)(iv)(f). Notwithstanding the foregoing, adjustments pursuant to clauses (a), (b) and (c) above shall be made only if the Manager reasonably determines that such adjustments are necessary or appropriate to reflect the relative economic interests of the Members. The Carrying Value of any Company asset distributed to any Member shall be adjusted immediately prior to such distribution to equal its Fair Market Value (if not adjusted pursuant to clause (b) above). If the Carrying Value of an asset has been determined or adjusted pursuant to clause (a) or (b) of this definition, such Carrying Value shall thereafter be adjusted by Depreciation taken into account in respect of such asset for purposes of computing Profits and Losses. Certificate of Formation: The Certificate of Formation of the Company, as amended or restated from time to time. Change in Control: The transfer, sale or other assignment of more than _________ percent (____%) of the Manager to an unaffiliated third party, provided, in each such case, that such Change in Control is not otherwise permitted pursuant to Section 0. For the sake of clarity, any transfer, sale or assignment by and/or among a Key Person to another Key Person and/or any [Manager Entity] as permitted under the governing documents of [Manager] shall not constitute a Change in Control. Closing Date: The date indicated in the first paragraph of this Agreement. Code: The Internal Revenue Code of 1986, as amended from time to time.

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Commitment Period: The period commencing on the Closing Date and ending on the first to occur of the following: (i) subject to Section 0, ____________ years from the Closing Date; (ii) the date of any notice of No Fault Removal; (iii) the date on which SCERS and the Manager (or an Affiliate) organize another pooled investment vehicle with substantially the same investment objectives; (iv) SCERS’ rejection of the Manager’s replacement plan pursuant to the terms of Section 0; (v) the date on which one hundred percent (100%) of aggregate Capital Commitments have been committed or drawn, and (vi) the failure of SCERS to provide the Manager with a Suspension Cessation Notice within 180 days after SCERS provides the Manager with a Suspension Notice pursuant to Section 5.6; provided that in any event, the Commitment Period may be terminated or extended by the Manager with the written consent of SCERS. Company: [Seattle Fund], LLC, the Washington limited liability company referred to in the first paragraph of this Agreement. Company Expenses: All expenses of the Company referred to in Sections 0 and 0. Company Investments: Fund Investments and any direct or indirect investments in Portfolio Companies in the event and to the extent that the Company has received a distribution in kind of Securities of such Portfolio Company from a Fund Investment and the Manager has not yet disposed of the same as provided herein. The term “Company Investments” shall exclude any Temporary Investment in which the Company invests its assets pending utilization or disbursement of funds. Company Level Information: The following information: (i) the name and address of the Company and a brief description of the investment strategy of the Company; (ii) the closing date of the Company; (iii) SCERS’ Capital Commitment; (iv) SCERS’ Capital Contributions to the Company and its membership interest in the Company as of particular specified dates; (v) SCERS’ carrying value of the Company or the Company’s net asset value as of particular specified dates; (vi) distributions made to SCERS as of particular specified dates; (vii) the valuation of SCERS’ membership interest in the Company; and (viii) such ratios and performance information calculated by SCERS, including “multiples” and SCERS’ gross and net internal rate of return on its membership interest in the Company as of particular specified dates. Company Minimum Gain: The meaning ascribed to “partnership minimum gain” in Sections 1.704-2(b)(2) and 1.704-2(d) of the Treasury Regulations. Company Proceeds: Proceeds including cash or property received by the Company in respect of a Company Investment. Company Profit: As of any date, the amount equal to aggregate Company Proceeds less the sum of (i) Capital Contributions plus (ii) Company Expenses (other than Company Expenses funded directly from Capital Contributions); provided that, for purposes of Section 0, if the amount of Company Profit is less than zero, then Company Profit shall be deemed to be zero. Confidential Information: All information concerning this Agreement, the Company and its investment strategy and activities, and Company Investments, but excluding information that is or becomes (a) generally available to the public other than as a result of a breach of this
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Agreement, (b) available to a party on a non-confidential basis prior to its disclosure to such party by another party, (c) developed independently by a party without reference to Confidential Information disclosed to such party by any other party, (d) Company Level Information, or (e) Portfolio Level Information. Conflict: As defined in Section 5.2(c). Consultation Period: As defined in Section 0. Default Rate: The rate of interest publicly announced from time to time by ____________ as its “base” or “prime” rate, plus ________ percent (__%). Defaulting Member: As defined in Section 0. Depreciation: For any Fiscal Year, an amount equal to the depreciation, amortization or other cost recovery deduction allowable in respect of an asset for such Fiscal Year, except that if the Carrying Value of any asset differs from its adjusted basis for U.S. federal income tax purposes at the beginning of such Fiscal Year, Depreciation shall be an amount that bears the same ratio to such beginning Carrying Value as the U.S. federal income tax depreciation, amortization or other cost recovery deduction for such Fiscal Year bears to such beginning adjusted tax basis; provided, however, that if the adjusted basis for U.S. federal income tax purposes of an asset at the beginning of such Fiscal Year is zero, Depreciation shall be determined with reference to such beginning Carrying Value using any reasonable method approved by the Manager. Disabling Conduct: Any action or inaction relating to the Company or its activities constituting negligence, recklessness, fraud, willful misconduct, or breach of fiduciary duty; any indictment for a felony or conviction (or plea of nolo contendere or its equivalent) of a violation of criminal law; any material breach of the Agreement (including a default under Section 0) not cured within fifteen (15) days of notice thereof; material misrepresentation; or willful violation of law relating to the Company or its activities. Dissolution Sale: All sales and liquidations by or on behalf of the Company of all or substantially all of its assets in connection with or in contemplation of the winding up of the Company. Distribution: Any distribution made by the Company to any Member. Event of Dissolution: Any of the following: The earlier of (i) one year after the date on which all of the Company Investments have been liquidated or (ii) the twelfth anniversary of the date hereof, provided that, in either case, the Manager may extend the term of the Company for successive one year periods with the consent of SCERS; The failure to continue the business of the Company in accordance with Section 0 following an Event of Withdrawal;

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The election by the Manager to dissolve the Company with the consent of SCERS; or The entry of a decree of judicial dissolution under the Act. Event of Withdrawal: Any of the following: (a) (b) Member; (c) The Manager is removed as the manager in accordance with Section 0; The Manager withdraws from serving as the manager of the Company; The Manager ceases to be a Member of the Company or is a Defaulting

(d) The Manager or any [Manager Entity] (i) makes an assignment for the benefit of creditors; (ii) files a voluntary petition in bankruptcy; (iii) is adjudicated as bankrupt or insolvent; (iv) files a petition or answer seeking for itself any reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief under any statute, law, or regulation; (v) files an answer or other pleading admitting or failing to contest the material allegations of a petition filed against it in any proceeding of this nature; or (vi) seeks, consents to, or acquiesces in the appointment of a trustee, receiver, or liquidator of the Manager or such [Manager Entity] or of all or any substantial part of its properties; (e) Any proceeding commences against the Manager or any [Manager Entity] seeking reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief under any statute, law, or regulation, if the proceeding has not been dismissed within sixty (60) days; or the appointment without its consent or acquiescence of a trustee, receiver, or liquidator of the Manager or such [Manager Entity] or of all or any substantial part of its properties, if the appointment is not vacated or stayed within sixty (60) days, or, if stayed, the appointment is not vacated within sixty (60) days after the expiration of any such stay; (f) (g) There is a Change in Control; or The Manager dissolves and commences its winding up.

Excess Amount: As defined in Section 0. Fair Market Value: The fair market value of the asset as determined by the Manager in good faith in accordance with the valuation procedures in Section 0. Final Distribution: As defined in Section 0. Fiscal Period: The period beginning on (a) the first day of each Fiscal Year, (b) any other day on which any Member makes Capital Contributions, that are not made pro rata in accordance with the Members’ respective Percentage Interests, (c) the day immediately following the date as of which any amount is debited to the Capital Account of any Member as a result of a non pro rata distribution in kind of more than a de minimis amount of property or a non pro rata distribution of more than a de minimis amount of money, as consideration for an Interest in the

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Company, or (d) the day of the grant of an Interest in the Company (other than a de minimis interest) as consideration for the provision of services to or for the benefit of the Company by an existing Member acting in a Member capacity, or by a new Member acting in a Member capacity or in anticipation of being a Member and ending on the earliest of (x) the last day of each Fiscal Year, (y) the day preceding the date any Members make any such non pro rata Capital Contributions, or (z) the day on which any amount is debited to the Capital Account of any Member as a result of any such non pro rata distribution in kind of property or non pro rata distribution of money referred to in clause (c) of this definition. Fiscal Year: As defined in Section 0. Foreign Shell Bank: As defined in Section 0. Fund Investments: As defined in Section 0. Interests: As defined in Section 0. Interim Excess Amount: As defined in Section 0. Investment Company Act: The Investment Company Act of 1940, as the same may be amended from time to time. Investment Guidelines: The investment objectives, restrictions and guidelines set forth in Schedule 2.3 hereto, as the same may be revised from time to time with the consent of the Members. Investment Plan: As defined in Section 5.3(b). Investment Vehicle: As defined in Section 5.7(a). Key Person Departure: The occurrence of any one of the following events: [To be determined.] Key Persons: [To be determined.] Liquidator: As defined in Section 0. Loss: As set forth in the definition of Profit and Loss. Management Fee: As defined in Section 0. Manager: [Manager], a ___________ [limited liability company], or a successor manager pursuant to Section 0. Manager Clawback: As defined in Section 0. [Manager Entity]: Each of [Manager] and all of its Affiliates.

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Marketable Securities: Securities that are traded on a national securities exchange or reported through the automated quotation system of a registered securities association and which at the time (i) are not subject to any “hold back” or “lock up” agreement and (ii) are eligible for sale by the distributee (assuming such distributee is not otherwise an Affiliate of the issuer of such securities) pursuant to a registration statement effective under the Securities Act or pursuant to Rule 144(k) of the Securities Act, or any similar provision then in force. Members: The Manager, the Members, and any other Persons hereafter admitted to the Company as a member pursuant to this Agreement and the Act, for so long as any such Person remains a member of the Company pursuant to this Agreement and the Act. No-Fault Removal: As defined in Section 0. Non-Cooperative Jurisdiction: As defined in Section 0. Non-Marketable Securities: Any Securities other than Marketable Securities. Other Managed Entities: As of a date of determination, those Persons that are managed or served by any [Manager Entity] pursuant to a binding written agreement or with whom any [Manager Entity] maintains discretionary or non discretionary relationships, whether as a principal, general partner, investment advisor or in some other capacity for such Person. Patriot Act: As defined in Section 0. Percentage Interest: As to the Interest in the Company of any Member, the percentage determined by the ratio of the aggregate Capital Commitments of such Member to aggregate Capital Commitments by all Members. Each Member’s Percentage Interest shall be indicated on Schedule 2.8 hereto, as the same may be revised from time to time. Person: Any individual, estate, company, corporation, general partnership, limited partnership, limited liability partnership, joint venture, unincorporated association, limited liability company, governmental agency or instrumentality or any other entity of any type. Portfolio Company: A company in which a Portfolio Fund has made an investment. Portfolio Fund: Investment. A private equity fund in which the Company has made a Fund

Portfolio Fund Level Information: The following information with respect to a Portfolio Fund: (i) the name and address and a brief description of its investment strategy; (ii) the closing date; (iii) the Company’s Capital Commitment; (iv) the Company’s Capital Contributions to the Portfolio Fund and its ownership interest in the Portfolio Fund as of particular specified dates; (v) the Company’s carrying value of the Portfolio Fund’s net asset value as of particular specified dates; (vi) distributions made to the Company as of particular specified dates; (vii) the valuation of the Company’s ownership interest in the Portfolio Fund; and (viii) such ratios and performance information calculated by the Company, including “multiples” and the Company’s gross and net internal rate of return on its ownership interest in the Portfolio Fund as of particular specified dates.

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Preferred Return: With respect to any Member, the amount of Distributions required to be made to the Member in order for such Member to have received, taking into account as of any time of determination the amount and timing of all Capital Contributions by such Member and all Distributions received by such Member pursuant to Section 0 and 0, a rate of return of ___________ percent (______%) per annum on its Unreturned Contributed Capital, compounded annually. The following rules shall be used in making such calculation: (i) such calculation shall take into account Capital Contributions from the time such Capital Contributions were made; (ii) such calculation shall not take into account Distributions to be made to the Member as of such date; and (iii) amounts distributed or to be distributed to the Member pursuant to Sections 0 and 0 shall first be treated as a return of Unreturned Contributed Capital and then as a distribution of Preferred Return. Profit and Loss: For each Fiscal Year or other period, the taxable income or loss of the Company, or particular items thereof, determined in accordance with Code Section 703(a) (for this purpose, all items of income, gain, loss or deduction required to be stated separately pursuant to Code Section 703(a)(1) shall be included in taxable income or loss, with the following adjustments: (i) any income of the Company that is exempt from federal income taxation and not otherwise taken into account in computing Profit and Loss shall be added to such taxable income or loss; (ii) if the Carrying Value of any asset differs from its adjusted tax basis for federal income tax purposes, any gain resulting from a disposition of such asset shall be calculated with reference to such Carrying Value; (iii) if the Carrying Value of any asset differs from its adjusted tax basis for federal income tax purposes, in lieu of the depreciation, amortization and other cost recovery deductions taken into account in computing such taxable income or loss, there shall be taken into account Deprecation for such fiscal year, computed in accordance with the definition thereof; (iv) upon an adjustment to the Carrying Value of any asset, pursuant to the definition of Carrying Value, the amount of the adjustment shall be included as gain or loss in computing such taxable income or loss; (v) any expenditure of the Company described in Code Section 705(a)(2)(B) or treated as Code Section 705(a)(2)(B) expenditures pursuant to Treasury Regulations Section 1.704-1(b)(2)(iv)(i), and not otherwise taken into account in computing Profit or Loss pursuant to this definition, shall be subtracted from such taxable income or loss; and (vi) to the extent an adjustment to the adjusted tax basis of any asset included in Company property pursuant to Code Section 734(b) is required pursuant to Treasury Regulations Section 1.704-1(b)(2)(iv)(m)(4) to be taken into account in determining Capital Accounts as a result of a distribution other than in liquidation of a Member’s Interest, the amount of such adjustment shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases the basis of the asset) from the disposition of the asset and shall be taken into account for the purposes of computing Profit and Loss. Prohibited Investment: As defined in Section 0. Qualified Investor: An institutional or other sophisticated investor to which, in the reasonable opinion of the Manager, an Interest in the Company may be offered in a private placement without any violation of the registration requirements of the federal securities laws or any other applicable laws or regulations. Regulated Affiliate: As defined in Section 11.3(b)(xiii)0.

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Related Person: With respect to any entity, any director or senior officer of such entity. Removal for Cause: As defined in Section 0. Reserve: As defined in Section 0. Response to RFP: The response of the Manager to the RFP dated ______________ and any related documents. RFP: The Request for Proposal: Private Equity Program Manager issued by SCERS on ____________, 2014. SCERS Legacy Fund: Any private equity fund in which SCERS holds an investment that was closed prior to the formation of the Company. Securities: Shares of capital stock, limited partnership interests, limited liability company interests, warrants, options, bonds, notes, debentures and other securities and equity interests of whatever kind of any Person, whether readily marketable or not. Securities Act: The Securities Act of 1933, as amended. Suspension Cessation Notice: As defined in Section 5.6(a). Suspension Notice: As defined in Section 5.6. Target Investment Opportunity: All investment opportunities available to the Manager, any [Manager Entity], any Key Person or any of their respective Affiliates for investment by such Person or its clients that are consistent with the Investment Guidelines and objectives of the Company. Temporary Investments: Investments. Any investments of the Company that are not Company

Treasury Regulations: The regulations promulgated by the U.S. Treasury Department under the Code, as such regulations may be amended from time to time. Unfulfilled Commitment: As defined in Section 0. Unreturned Contributed Capital: As to any Member, the Member’s aggregate Capital Contributions, reduced by aggregate Distributions previously distributed to the Member pursuant to Section 0. ORGANIZATION. Formation of Limited Liability Company. The Company has been formed pursuant to and in accordance with the provisions of the Act. The Company hereby issues and the undersigned Manager and SCERS hereby acquire membership interests with the rights and obligations set forth in this Agreement and in accordance with the Act. The Manager has filed the Certificate of Formation on behalf of the Company, shall cause the Company to qualify to do
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business in the State of Washington and each other jurisdiction in which such qualification may be necessary or appropriate for the conduct of the business of the Company, and shall file such other certificates or instruments, and amendments thereto, as may from time to time be required by law or deemed appropriate by the Manager. The Manager shall promptly provide the Members with a copy of any such filings. Name. The name of the Company is and shall be [Seattle Fund, LLC], or such other name as the Members shall from time to time agree in writing. The Manager may hold securities in the name of custodians or brokers (or other customary “street names”). Objectives of the Company. The objective of the Company is to achieve a superior return on investments in private equity funds in accordance with the Investment Guidelines. The Company will seek opportunities in primary private equity fund investments and in secondary private equity fund investments (“Fund Investments”). In addition to acquiring, holding, managing and disposing of Company Investments, the Company will engage in such other activities as are permitted hereby or under the Act or are incidental or ancillary thereto as the Manager shall deem necessary or advisable, all upon the terms and conditions set forth in this Agreement. Principal Place of Business. The Company shall have its principal place of business at ________________________, or at such other location as the Manager may from time to time select. The Company may have such other place or places of business as the Manager may from time to time designate, provided that the Company may not establish a place of business outside the United States of America without the consent of SCERS. The Manager shall notify the Members in advance of any change in the principal business office of the Company. Specified Office and Agent for Service of Process in Washington . The address of the Company’s registered office in the State of Washington is ______________ __________, or at such other place in the State of Washington as the Manager may from time to time decide. The name of the registered agent of the Company for service of process in the State of Washington is __________________________ or such other agent as the Manager may from time to time designate. Fiscal Year. The fiscal year of the Company shall commence on January 1 and end on December 31 (“Fiscal Year”), except that the initial Fiscal Year shall commence on the Closing Date and the final Fiscal Year shall end on the date on which the winding up of the Company under Section 0 is completed. The Company shall have the same Fiscal Year for income tax purposes and for accounting purposes. Manager. The Members hereby appoint [Manager] to act as the sole manager of the Company in accordance with the terms and conditions of this Agreement. Members’ Capital Commitments. On the Closing Date, SCERS shall have an initial Capital Commitment of __________________ dollars ($____________) and the Manager shall have an initial aggregate Capital Commitment of _____________ dollars ($__________), in each case as set forth on Schedule 2.8 (as amended from time to time). If the Commitment Period is terminated for any reason prior to the third anniversary of the Closing Date, each

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Member’s Capital Commitment will be reduced to an amount equal to the sum of (i) the amount of such Member’s Capital Contributions to date, (ii) an amount equal to such Member’s share of current obligations to Portfolio Funds that have yet to be funded, and (iii) such Member’s share of future Company Expenses, as reasonably estimated by the Manager and approved by SCERS, including, for the avoidance of doubt, Management Fees. Throughout the term of the Company, the aggregate Capital Commitment of the Manager shall equal ______ percent (______%) of the aggregate Capital Commitments of SCERS. CAPITAL CONTRIBUTIONS; MEMBERS’ ACCOUNTS; ALLOCATIONS. Capital Contributions of the Members. The Members shall make Capital Contributions to the Company in immediately available funds upon at least seven (7) Business Days notice. Capital call notices provided hereunder shall comply with the requirements set forth in Schedule 3.1(a). The Members shall make Capital Contributions in accordance with and in proportion to their respective Capital Commitments, provided that, in the case of Capital Contributions for Management Fees, only the Members other than the Manager shall be required to make Capital Contributions. Notwithstanding Section 0, no Member shall be required to contribute capital after the end of the Commitment Period, except as may be necessary for (i) Company Expenses and Management Fees, (ii) completion of transactions with respect to which the Company has made a binding written commitment as of such date, and (iii) satisfying Company obligations to any Portfolio Fund. Available Capital. Notwithstanding anything to the contrary contained herein, except as provided in Section 0, no Member shall be obligated to contribute to the Company, in the aggregate, capital in excess of such Member’s Capital Commitment. Capital Accounts. An individual capital account (“Capital Account”) shall be maintained for each Member. The opening balance of each Member’s Capital Account for the Company’s first Fiscal Period shall equal the amount of such Member’s initial Capital Contribution to the Company. Each Member’s Capital Account shall thereafter be adjusted in accordance with the following provisions: Each Member’s Capital Account shall be credited with (A) the amount of any subsequent Capital Contributions made by such Member to the Company, and (B) such Member’s allocable share of Profit and, without duplication, and any items in the nature of income or gain that are specifically allocated to such Member pursuant to Section 0 hereof or other provisions of this Agreement; and Each Member’s Capital Account shall be debited by (A) the amount of cash and the Fair Market Value of any Company property distributed (or deemed distributed) to such Member pursuant to any provision of this Agreement (net of any liabilities secured by
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such property), (B) such Member’s allocable share of Loss and, without duplication, any items in the nature of expenses or losses that are specifically allocated to such Member pursuant to Section 130 hereof or other provisions of this Agreement, and (C) liabilities of such Member assumed by the Company or secured by any property contributed by such Member to the Company, calculated by reference to Code Section 752. With respect to distributions of Company property, Capital Accounts shall first be adjusted to reflect the manner in which the unrealized income, gain, loss, and deduction inherent in such property (that has not been previously reflected in Capital Accounts) would be allocated, pursuant to Section 0 hereof, to the Members if there were a taxable disposition of such property for its fair market value (taking Code Section 7701(g) into account) on the date of distribution. The provisions of this Agreement relating to the maintenance of Capital Accounts are intended to comply with Section 1.704-1(b) of the Treasury Regulations, and they shall be interpreted and applied in a manner consistent with such regulations. In the event the Manager shall determine that it is prudent to modify the manner in which the Capital Accounts, or any debits or credits thereto, are computed in order to comply with such regulations, the Manager may make such modification. Defaulting Member. Except as otherwise expressly provided under this Agreement, in the event that a Member fails to make any payment required to be paid hereunder (including, for the avoidance of doubt, any non-payment of Distributions by the Manager pursuant to Section 0), and such failure continues for twenty (20) days after receipt of notice of such default (which notice shall also be promptly given to such Member by telephone), then such Member shall be in default (a “Defaulting Member”) and shall be subject to the provisions of this Section 0. Notwithstanding any provision in this Agreement to the contrary, SCERS shall be released from its obligation to make any payments hereunder and shall not be a Defaulting Member under this Agreement if (i) it provides notice to the Manager not less than five (5) Business Days prior to the date on which the payment is due to the effect that there would be or there is a material likelihood that there would be a violation of applicable state law if it were to make such payment to the Company and (ii) on or before the date on which any such payment is due, it obtains an opinion of counsel to the effect that there would be or there is a material likelihood that its payment would result in a violation of applicable state law if it were to make such payment to the Company, and provides a copy of such opinion to the Manager. To the fullest extent permitted under the Act, whenever the vote, consent or decision of a Member or of the Members is required or permitted pursuant to this Agreement, any Defaulting Member shall not be entitled to participate in such vote or consent, or to make such decision, and such vote, consent or decision shall be tabulated or made as if such Defaulting Member were not a Member.

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A Defaulting Member shall not be entitled to make any further Capital Contributions to the Company and each non defaulting Member may elect to increase its Capital Commitment by its pro rata share of the difference between such Defaulting Member’s Capital Commitment and Capital Contributions (the “Unfulfilled Commitment”), such pro rata share determined on the basis of such non-defaulting Member’s Capital Commitment at the time of default compared to the total Capital Commitments of all non defaulting Members that elect to increase their Capital Commitments at such time. If a non defaulting Member increases its Capital Commitment under this Section 0, then such non defaulting Member’s Percentage Interest shall be adjusted to reflect the increased Capital Commitment of such Member. If the non-defaulting Members do not elect, pursuant to Section 0, to increase their Capital Commitments by the full amount of the Unfulfilled Commitment, the nondefaulting Members shall have the right (but shall have no obligation) to cause the Defaulting Member to sell all or any portion of the Defaulting Member’s remaining limited liability company interest (equal to the sum of (i) the Capital Contributions of the Defaulting Member plus (ii) the difference between the Unfulfilled Commitment and the amount by which the nondefaulting Members elected to increase their Capital Commitments pursuant to Section 0) for the account of the Defaulting Member at the best price that the non-defaulting Members can, using reasonable effort, promptly obtain without any assumption of credit risk. No right, power or remedy conferred in this Section 0 shall be exclusive, and each such right, power or remedy shall be cumulative and in addition to every other right, power or remedy whether conferred in this Section 0 or now or hereafter available at law or in equity or by statute or otherwise. No course of dealing between the Members and no delay in exercising any right, power or remedy conferred in this Section 0, or now or hereafter existing at law or in equity or by statute or otherwise, shall operate as a waiver or otherwise prejudice any such right, power or remedy. A Defaulting Member shall pay interest at an annual rate equal to the Base Rate or, if lower, the highest rate permitted by applicable law on any past due amount from the date such amount became due until the date on which such payment is received by the Company (by application of withheld Distributions or otherwise). Interest so paid shall be distributed to the non-defaulting Members. Reserve. For the purposes set forth in Section 0 below, the Manager shall create a reasonable reserve (the “Reserve”) from (i) amounts called for Company Investments and/or Company Expenses and not used for the purpose called, (ii) amounts received as distributions from Company Investments, and (iii) amounts received as proceeds of the disposition or liquidation of a Company Investment, provided that (A) such Reserve shall be invested only in Temporary Investments permitted under Section 0, and (B) the Manager shall have delivered prompt notice to the Members of any funds described in Section (i), (ii) or (iii) above that are deposited into the Reserve. Amounts shall be withdrawn from the Reserve solely for purposes of meeting current or anticipated Company Expenses satisfying obligations owed to any Portfolio Fund or

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making Distributions to the Members. The Manager shall keep accurate reports reflecting additions to and withdrawals from the Reserve. COMPANY DISTRIBUTIONS. Withdrawal of Capital. Except as otherwise expressly provided in this Section 0, no Member shall have the right to withdraw any amount from the Company. Distributions. Subject to Section 0, all Company Proceeds shall be distributed to the Members in the following order of priority: First, to the Members in proportion to their Percentage Interests until each Member has received aggregate Distributions under this Section 0 equal to its Capital Contributions; Second, to the Members in proportion to their Percentage Interests until each Member has received aggregate Distributions under this Section 0 equal to its Preferred Return; Thereafter, (A) __________ percent (_______%) to the Members in proportion to their Percentage Interests and (B) ______ percent (____%) to the Manager. Subject to Section 0, proceeds received by the Company from Temporary Investments shall be distributed to the Members in proportion to their Percentage Interests. Notwithstanding any provision to the contrary contained in this Agreement, the Company shall not make a Distribution to any Member on account of its interest in the Company if such Distribution would violate the Act or any other applicable law. The Manager shall cause the Company to make Distributions to the Members of all proceeds received by the Company from (i) Temporary Investments and (ii) Company Investments as promptly as possible but in any event within thirty (30) days of receipt thereof, except (A) as otherwise provided in Section 0 with respect to the Reserve, or (B) to the extent such proceeds are used to pay Company Expenses or Management Fees that are then due and owing. In the event the Company receives a distribution in kind of a Marketable Security, the Manager shall liquidate such Marketable Security and distribute the proceeds, rather than make a Distribution in kind, unless otherwise agreed by SCERS. For purposes of this Agreement, any property other than cash distributed to Members in kind shall be deemed to have been sold for cash for its Fair Market Value (net of any liabilities secured by such distributed property that the recipient Members are considered to assume or take subject to under Section 752 of the Code) on the Business Day immediately preceding the date of the distributions, and any gain or loss associated with such deemed sale

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shall be included in determining Profit or Loss for purposes of the allocations specified in Section 0. Any such distributions shall be made after giving effect to the allocations required by Section 0, adjustments to Capital Accounts in respect of distributions of such property shall reflect such Fair Market Value and, subject to Section 0, all such distributions shall be made in the same respective proportions as distributions would at the time be distributed pursuant to Section 0. If a Member would otherwise have distributed to it an amount of any Security that would cause such Member to own or control in excess of the amount of such Security that it may lawfully own or control or which by reason of any legal or contractual restriction the Manager may not make such proposed distribution to such Member, and the Manager shall consult with such Member so as to avoid such excessive ownership or control or so as to comply with such restriction. The Manager may cause certificates evidencing any Securities to be distributed in kind to be imprinted with legends as to such restrictions on transfers necessary or appropriate to assure compliance with applicable federal or state securities law or other legal or contractual restrictions, and may require the Members to agree in writing (i) that such Securities will not be transferred except in compliance with such restrictions and (ii) to such other matters as the Manager may reasonably deem necessary or appropriate. Final Distribution and Manager Clawback. The Final Distribution shall be made in accordance with the provisions of Section 0. If, following the dissolution and winding up of the Company and the distribution of all or substantially all of the Company’s assets pursuant to Section 0, the Manager has received Distributions in respect of its Carried Interest in excess of ________ percent (____%) of the excess of aggregate Company Profits over the Preferred Return (the “ Excess Amount”), the Manager shall, prior to the application and distribution of the Company’s assets pursuant to Section 0, contribute to the capital of the Company an amount of cash or property (“ Manager Clawback”) equal to the Excess Amount; provided, however, that the amount required to be returned under this Section 0 shall not exceed in any case the aggregate Distributions to the Manager in respect of its Carried Interest less the aggregate income tax liability in respect of allocations attributable to the Carried Interest of each Person whose tax liability is determined by reference to the income of the Manager, as determined by the Manager in its reasonable discretion following consultation with SCERS, based on the Assumed Income Tax Rate and the amounts allocated to the Members, and otherwise based on such reasonable assumptions as the Manager determines in good faith to be appropriate. The Manager shall cause each of its then partners or members who receive carried interest to severally guarantee their pro rata shares of the Manager’s obligation under this Section 0. On each of the seventh (7th) and tenth (10th) anniversary of the Closing Date, the Manager shall determine whether it has received Distributions in respect of its Carried Interest in excess of _____ percent (___%) of the excess of aggregate Company Profits over the Preferred Return (the “Interim Excess Amount”), provided that, for purposes of this Section 0, Company Profits shall be calculated as if all Company Investments were sold for their then Fair Market Value. If an Interim Excess Amount exists as of such date, then the Manager shall contribute to

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the Company an amount equal such Interim Excess Amount. Amounts contributed by the Manager pursuant to this Section 0 shall be distributed among the Members in proportion to their Percentage Interests. The Manager shall cause each of its then partners or members who receive Distributions in respect of its Carried Interest to severally guarantee their pro rata shares of the Manager’s obligation under this Section 0 or enter into such other arrangements of similar effect. Tax Distributions. Notwithstanding any other provision of this Agreement, the Company shall, prior to any Distribution pursuant to Section 0, make Distributions to the Members in amounts intended to enable the Members (or any Person whose tax liability is determined by reference to the income of a Member) to discharge their United States federal, state and local income tax liabilities arising from the allocations made pursuant to Section 0. The amount distributable pursuant to this Section 0 in any Fiscal Year shall be determined by the Manager in its reasonable discretion following consultation with SCERS, based on the Assumed Income Tax Rate and the amounts allocated to the Members, and otherwise based on such reasonable assumptions as the Manager determines in good faith to be appropriate. The amount distributable to the Members pursuant to this Section 0 shall be treated as an advance against, and shall reduce the amount of, the next Distribution(s) that the Members otherwise would receive pursuant to Section 0. Valuation. The Company’s interest in each Portfolio Fund shall be valued in accordance with the Company’s allocable interest in the aggregate net value of all Portfolio Companies, after taking into account all expenses, fees and other liabilities allocable to the Company pursuant to the terms of the Portfolio Fund and with an appropriate adjustment for carried interest payable to the manager of the Portfolio Fund. Such valuation may be determined by the Manager in reliance upon valuations prepared and delivered by the manager of the Portfolio Fund, provided that if the Manager is aware of facts that suggest (or shall otherwise in good faith determine) that the valuation supplied by the manager of the Portfolio Fund does not reflect the fair market value of the Company’s interest in such Portfolio Fund, the Manager will determine such valuation at fair market value in accordance with this Section 0 as determined in good faith by the Manager. Upon liquidation of a Marketable Security by the Company, the value of such Marketable Security shall be the liquidation price actually obtained for such Marketable Security. If a Marketable Security is distributed in kind, the value of such Marketable Security shall be as agreed by the parties. If the valuation of a Marketable Security is for purposes of a quarterly report prepared by the Manager pursuant to Section 0, such Marketable Security shall be valued as of the date of such quarterly report, based on (x) prior to liquidation of such Marketable Security, (i) the closing price or (ii) if such closing price is not readily available, the average of the closing bid and asked price, as the case may be, of such Marketable Security, or (y) upon liquidation of such Marketable Security, the liquidation price actually obtained for such Marketable Security. Any valuation of Marketable Securities of Portfolio Companies in connection with quarterly reports pursuant to this Section 0 may be determined by the Manager in reliance upon valuations prepared and delivered by the manager of the Portfolio Fund, provided that, if the Manager is aware of facts that suggest (or otherwise in good faith determines) that the valuation supplied by the manager of the Portfolio Fund does not reflect the fair market value of such Marketable Securities, the Manager shall make an independent

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determination of the fair market value of such Marketable Securities in accordance with this Section 0. The Manager shall value all Non Marketable Securities at fair market value as determined in good faith by the Manager. Non Marketable Securities will generally be valued at cost, at the price of subsequent financings by third parties, or at an appropriate discount selected in good faith by the Manager from publicly traded Securities of similar companies. Securities of public companies that are held subject to certain restrictions will generally be valued at an appropriate discount selected in good faith by the Manager from market prices of the same Securities that are not subject to restrictions. Valuations of Non Marketable Securities of Portfolio Companies may be determined by the Manager in reliance upon valuations prepared by the manager of the Portfolio Fund, provided that if the Manager is aware of facts that support the conclusion (or otherwise in good faith determines) that the valuation supplied by the manager of the Portfolio Fund does not reflect the fair market value of such Non Marketable Securities, the Manager shall make an independent determination of the fair market value of such Non Marketable Securities in accordance with this Section 0. All valuations under this Section 0 shall be reviewed by SCERS. If SCERS objects to any valuation of Non Marketable Securities made for the purpose of making any Distribution in kind, the Manager shall obtain an appraisal of the value of such Non Marketable Securities by an independent investment banking, accounting or financial consulting firm that is satisfactory to SCERS. Any such appraisal shall be prepared at the Company’s expense and shall be binding on all parties. Notwithstanding the foregoing, in valuing any Portfolio Company, absent evidence to the contrary or the consent of SCERS, the Manager shall in no event employ valuations of Marketable Securities or Non Marketable Securities held by a Company Investment that are greater than those then being employed by the Company Investment. Withholding Taxes. The Manager is authorized to take any action that it determines to be necessary or appropriate to cause the Company to comply with any foreign or United States federal, state or local withholding or deduction requirement with respect to any allocation, payment or distributions by the Company to any Member or other Person, provided that the Company shall give any such Member or other Person prompt notice of any such withholding or deduction and the basis therefor. The Manager and the Company shall, upon a Member’s request and at such Member’s expense, cooperate to the extent reasonably necessary to enable such Member to contest any such tax liability, provided that such contest does not subject the Company or the Manager to any potential liability to a taxing authority for any such claimed withholding or payment. All amounts so withheld, and, in the manner determined by the Manager in its discretion, amounts withheld with respect to any allocation, payment or distribution by any Person to the Company, shall be treated as Distributions to the applicable Members under the applicable provisions of this Agreement. If any such withholding requirement with respect to any Member exceeds the amount distributable to such Member under the applicable provision of this Agreement, or if an such withholding requirement was not satisfied with respect to any amount previously allocated or distributed to such Member, such Member and any successor or assignee with respect to such Member’s Interest shall, to the fullest extent permitted by applicable law, promptly upon request therefor, reimburse the Company and its agents, partners,

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members, officers, directors, employees or shareholders for any and all amounts paid or payable by the Company or any such Person arising out of or relating to any claims, liabilities and reasonable costs and expenses of whatever nature relating to the Company’s or such Person’s obligation to withhold and to pay over, or otherwise pay, any withholding or other taxes payable by the Company or such Person with respect to such Member or as a direct result of such Member’s interest in the Company, and otherwise indemnify and hold harmless the Manager and the Company for such excess amount or such withholding requirement, as the case may be. Any withholding taxes withheld or payment made pursuant to this Section 0 shall be withheld or made at the maximum applicable statutory rate under the applicable tax law unless the Manager shall have received an opinion of counsel reasonably satisfactory to the Manager or other evidence reasonably satisfactory to the Manager to the effect that a lower rate is applicable or that no withholding is applicable or payment required. MANAGEMENT. Powers and Duties of Manager. SCERS shall have the full and exclusive right and authority to manage and control the business and affairs of the Company. SCERS shall have the right, on behalf of the Company, to appoint a Person to act as the Manager or replacement Manager in the event the then existing Manager is terminated in accordance with this Agreement. SCERS appoints [Manager] to be the Manager of the Company in accordance with the terms hereof. [Manager] accepts such appointment and agrees to perform the obligations of the Manager in accordance with this Agreement. Subject to all matters required to be approved by SCERS, the Manager shall have the authority to make all decisions with respect to the management of the Company in accordance with this Agreement. The Manager shall not assign any of its rights or delegate any of its obligations without the approval of SCERS. [Alternative: The parties hereby acknowledge that, contemporaneously with the execution of this Agreement, the Manager has caused the Company to enter into an investment advisory agreement with [the Investment Advisor] in exchange for the Management Fee as provided in Section 0 (and may hereafter delegate to [the Investment Advisor] and any of its permitted successors, any of its rights and powers with respect to investment management services), provided that any such investment advisory agreement and delegation shall be consistent with the terms of this Agreement. Such delegation by the Manager shall not cause the Manager to cease to be a manager of the Company and shall not relieve the Manager of any of its duties and obligations under this Agreement.] The [parent entity of the Manager] shall provide a guarantee of all obligations of the Manager. The Manager shall not resign as manager of the Company except as expressly permitted by this Agreement. Without limiting the general powers and duties set forth in Section 0 above (but subject to the terms and conditions of this Agreement), the Manager is hereby authorized and empowered on behalf and in the name of the Company to do the following: Direct the formulation of investment policies and strategies for the Company, and select and approve the investment of Company

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funds, in (A) Company Investments and (B) Temporary Investments; Acquire, hold, sell, transfer, exchange and dispose of Securities, and exercise all rights, powers, privileges and other incidents of ownership or possession with respect to Securities, including, without limitation, the voting of Securities, the approval of a restructuring of an investment in Securities, participation in arrangements with creditors, the institution and settlement or compromise of suits and administrative proceedings and other like or similar matters; Open, maintain and close bank accounts, including custodial accounts, and draw checks or other orders for the payment of money and open, maintain and close brokerage, mutual fund and similar accounts; Hire and remove consultants, attorneys, accountants and such other agents and employees as it may deem necessary or advisable, pay compensation for such services and authorize any such agent or employee to act for and on behalf of the Company; Retain third parties (who may be Affiliates of the Manager, subject to the terms of Section 0) to provide services to the Manager and/or the Company, including investment advisory services; Make appropriate elections and other decisions with respect to tax and accounting matters; Monitor on behalf of the Company all Company Investments; Make, enter into, and perform subscription agreements, limited partnership agreements and limited liability company agreements, including any amendments thereto or documents contemplated thereby, without any further act, vote or approval of any Member, subject to Section 5.3(f); and Make, enter into and perform such agreements and undertakings as may be necessary or advisable to the carrying out of any of the foregoing powers, objects or purposes. Fiduciary Duties; Conflicts of Interest. The Manager hereby acknowledges that (i) the assets that are invested in the Company by SCERS are held in trust for the exclusive benefit of the members of SCERS and their beneficiaries; (ii) the Manager is a fiduciary with respect to the members of SCERS, their beneficiaries, and the Company, (iii) the Manager shall comply with applicable law and the standards of fiduciary responsibility set forth in Revised Code of Washington § 35.39.060, (iv) the Manager shall discharge its duties under the Agreement solely in the interest of, and for the

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exclusive purpose of providing benefits to, the members of SCERS and their beneficiaries and defraying reasonable expenses charged to SCERS, and (v) the Manager shall cause the Key Persons to act in accordance with such fiduciary duties. In furtherance of Section 1.1(a), the Manager shall perform its obligations under this Agreement 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 management of an enterprise of like character and with like aims, and the Manager shall comply with the requirements of this Agreement for managing Conflicts and allocating investment opportunities. The Manager shall promptly give a Notice to SCERS in the event any proposed Company Investment, or any other transaction or activity of the Company, involves (directly or indirectly) any conflict of interest in the performance of the Manager’s fiduciary duties (each, a “Conflict”), including the following: (i) any contract or transaction between the Company and the Manager, any [Manager Entity] or a Key Person (or any Affiliate of any such Person); (ii) any contract or transaction on behalf of the Company in which the Manager, any [Manager Entity] or a Key Person (or any Affiliate of any such Person) has a direct financial interest, including any transaction with any client or Other Managed Entity of the Manager; or (iii) any other conflict of interest of which the Manager is aware that involves a financial interest of the Manager, any [Manager Entity] or a Key Person (or any Affiliate of any such Person). The Notice of any Conflict shall fully disclose the Conflict in specific detail sufficient to enable SCERS to understand and evaluate the Conflict. The Manager shall not cause or permit the Company to enter into any transaction, including any investment or disposition or other transaction with respect to an investment or any agreement with respect to the provision of services involving a Conflict without the approval of SCERS and unless the transaction is on arm’s length terms. In the case of an acquisition or disposition of an asset by the Company involving an Affiliate, client or Other Managed Entity of the Manager, the Manager shall, upon SCERS’ request, obtain an independent appraisal of the value of the asset at the expense of the Company. In exercising its rights under this Agreement, SCERS shall have no fiduciary duties to the Manager, the Company or any other Member, and may act in its own interests without regard to the interests of the Manager, the Company, or any other Member; provided that SCERS shall be required to act in good faith. Investment Management. The Manager shall make Fund Investments on behalf of the Company in accordance with the objectives of the Company as stated in Section 0 and otherwise in accordance with this Agreement. The Manager shall not commit the Company to make investments in Portfolio Funds in an amount that exceeds the Company’s aggregate Capital Commitments. Prior to the commencement of investment activity, the Manager, in consultation with SCERS, shall draft an investment plan (the “Investment Plan”) setting forth portfolio

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construction guidelines, investment restrictions, benchmark targets and an overview of the target market (funds coming to market on a forward looking basis). The Manager will review and update the Investment Plan at least annually and as needed to deal with changing market conditions. The Investment Plan will be designed to meet SCERS’ objectives and will be subject to SCERS’ approval. The Manager will be responsible for analyzing all Target Investment Opportunities, including quantitative assessment of managers and their track record, risk profile, benchmarking and a qualitative review of managers and their backgrounds. During the Commitment Period, the Manager shall, and shall cause its Affiliates and the Key Persons to, allocate Target Investment Opportunities among SCERS and Other Managed Entities in accordance with the Manager’s allocation policy, a copy of which shall be provided to SCERS (the “Allocation Policy”). The Manager shall comply with the following investment process for each Fund Investment to be made by the Company: [To be determined by the parties.] Target Investment Opportunities. The Manager shall use reasonable commercial efforts to provide SCERS with real time access to all deal log and due diligence information. Due Diligence. The Manager shall follow its standard due diligence policies and procedures in connection with any Target Investment Opportunity. Recommendation. Upon the Manager making a formal recommendation to proceed with investment in the Target Investment Opportunity, the Manager will provide SCERS with a summary report of the Target Investment Opportunity and will demonstrate that the Target Investment Opportunity complies with the Investment Guidelines and the Investment Plan. The Manager will provide notice of, and SCERS shall have an open invitation to attend, all meetings at which final investment decisions by the Manager are made. Compliance with the foregoing may be implemented by utilizing telephone conference equipment for such meetings. [Approval of Investments. SCERS will retain the right to veto the Company’s investment in any Target Investment Opportunity, provided that the Manager may consummate a Company Investment unless SCERS has delivered to the Manager a notice of veto within ten (10) Business Days after the receipt by SCERS of the Manager’s report with respect to the applicable proposed investment.] [To be included if SCERS has veto rights.] Negotiation of Documents. The Manager shall negotiate the terms of the investment (as set out in the partnership agreement or other documents for the investment, and any side letter or similar
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agreement) with the assistance of counsel selected by Manager and approved by the SCERS. Subscription Documents. The Manager shall complete the subscription agreement for approved investments and take all other actions necessary to close the investment on the Company’s behalf. Materials to SCERS. Upon consummation of an investment by the Company, the Manager shall provide SCERS with an investment memorandum summarizing the investment. The Manager shall provide, at SCERS request, copies of all executed closing documents for each investment by the Company excluding Temporary Investments. The Manager shall be responsible for: making all capital calls hereunder to satisfy capital calls that the Company is required to meet with respect to any Company Investment; receiving, recording, reporting and distributing all distributions received from all Company Investments; promptly delivering to the Members copies of all financial statements or other information received from Portfolio Funds and Portfolio Companies that the Members may request from time to time; and entering into amendments of agreements relating to Company Investments, provided that the Manager shall, if requested by a Member, provide the Members with a notice describing any material consent or other action taken by the Manager with respect to any Company Investment. The Manager will manage Company Investments with the objective of maximizing returns and reducing risk. Management may include disposing of assets and/or restructuring underperforming partnerships. The Manager shall invest Temporary Investments only in the following: [To be determined by the parties.] Commitment of Resources; Other Business Relationships. Throughout the term of the Company, the Manager shall devote such resources as shall be necessary to (i) carry out the Company’s investment objectives and manage Company Investments, and (ii) provide the services described in this Agreement. Except as otherwise provided herein, the Manager, any Key Person, ______________, and any [Manager Entity] and Affiliates of each of the foregoing, individually or with others, may engage in other investments or business ventures of any kind, including, without limitation, private equity investment funds. Neither the Company nor any Member shall have any rights or obligations by virtue of this Agreement in and to such independent ventures and activities or the income or profits derived therefrom. Except as otherwise provided herein, none of the Manager, any [Manager Entity], any Key Person, or any Affiliate of any such Person may invest in any Target Investment Opportunity other than through the Company or otherwise in accordance with the allocation procedures set forth in Section 0.
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Notwithstanding anything to the contrary herein, the Manager, any [Manager Entity], any Key Person, and Affiliates of each of the foregoing shall be prohibited from receiving fees or other compensation from Portfolio Funds as compensation for the Company’s investment therein. Additional Obligations of the Manager. The Manager shall meet with SCERS as provided at Section 0. Unless otherwise approved by SCERS, ____________________ shall serve as the primary liaison between the Manager and SCERS and shall make himself available for all inquiries of SCERS. If at any time the primary liaison ceases to be actively involved with the Manager, the Manager shall, within twenty (20) days, identify a replacement primary liaison, subject to the approval of SCERS. Subject to any confidentiality restrictions binding on the Manager, the Manager will notify SCERS of the size and identity of all Other Managed Entities and the final allocations among the Company and all Other Managed Entities in respect of each Target Investment Opportunity. The Manager shall (i) certify to SCERS on an annual basis that it has complied with the Allocation Policy, (ii) provide SCERS information regarding how it complied with the Allocation Policy with respect to Target Investment Opportunities, and (iii) provide SCERS a reasonable opportunity for questions and discussion regarding the application of the Allocation Policy. Furthermore, the Manager shall, and shall cause each Key Person to, ensure, on a going forward basis, that the Company (and any successor fund of the Company) will receive an allocation, vis-à-vis Other Managed Entities with similar investment objectives, in any successor fund to a Portfolio Fund in an amount equal to the ratio of (A) the amount of the Company’s commitment to such Portfolio Fund to (B) the total amount of primary commitments made to such Portfolio Fund by the Company and Other Managed Entities. The Manager shall provide the same services to SCERS with respect to all SCERS Legacy Funds as it provides with respect to the Company’s Portfolio Funds, including, without limitation, the services described in Section 0 and the reporting described in Section 0. For the avoidance of doubt, proceeds from SCERS Legacy Funds shall not constitute Company Proceeds for the purposes of Section 4, as applicable. The Manager shall, at all times during the term of this Agreement, obtain and maintain continuously, at its own expense, (i) professional liability insurance with respect to the Manager’s professional services under this Agreement; and (ii) a fidelity bond in an amount that is suitable and customary relative to the Manager’s total assets under management. The Manager shall provide to SCERS evidence of such policies as in place from time to time. Suspension Events. If, at any time during the Commitment Period and in the sole discretion of SCERS, SCERS provides the Manager with written notice of its desire that the Company cease all new investment activity (a “Suspension Notice”), the Company shall be prohibited from making any new Company Investments other than completion of transactions with respect to which the Company had made a binding commitment to invest as of the date the Suspension
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Notice was given to the Manager or Company Investments otherwise approved by SCERS (and, for the avoidance of doubt, the Company may satisfy Company obligations to existing Portfolio Funds) unless and until such time as SCERS provides written notice to the Manager of its desire for the Company to continue with new investment activity (a “Suspension Cessation Notice”). If SCERS fails to provide a Suspension Cessation Notice within 180 days of providing the Manager with a Suspension Notice, the Commitment Period shall terminate. Upon the occurrence of a Key Person Departure, the Manager shall promptly, but in any event within ten (10) Business Days, provide written notice thereof to SCERS, and the Commitment Period shall immediately be suspended until terminated or continued in accordance with the further provisions of this Section 0. Upon suspension of the Commitment Period hereunder, the Manager shall have thirty (30) days to submit a plan specifying the course of action by the Manager to remedy or otherwise address the Key Person Departure. During a period of thirty (30) days after its receipt of the Manager’s proposed plan (the “ Consultation Period”), SCERS shall meet and consult with the Manager regarding the proposed plan, and, in the event the initial plan is not acceptable to SCERS, it shall discuss alternatives, if any, that would be acceptable to SCERS. If the Key Person Departure occurs during the Commitment Period and SCERS agrees to a plan to remedy the Key Person Departure, then the Company’s Commitment Period shall no longer be suspended and shall continue as if the Key Person Departure had not occurred, subject to any modifications provided in the agreed plan. If, by the end of the Consultation Period, SCERS and Manager have not agreed to a plan acceptable to SCERS, SCERS may provide written notice to the Manager of its rejection of such plan; provided that the failure by SCERS to provide such written notice within one hundred and eighty (180) days after the conclusion of the Consultation Period shall be deemed a rejection of the plan proposed by the Manager. If applicable, the Commitment Period shall terminate upon the rejection of such replacement plan. Investment Vehicles. The Manager may determine for legal, tax, regulatory or other reasons that the Company shall invest certain or all Company Investments indirectly, through a limited liability entity (an “Investment Vehicle”) and, if necessary, the structure of an Investment Vehicle may differ from that of the Company. If the Company invests through an Investment Vehicle, each Member shall have the same economic interest in all material respects in the investments made through such Investment Vehicle as it would have if such investments had been made directly by the Company. Each Investment Vehicle shall provide for the limited liability of its members or limited partners as a matter of the organizational documents of such Investment Vehicle, and the Company, the Manager, or an Affiliate thereof, shall serve as the manager (or in a substantially similar capacity) or as investment adviser with respect to such Investment Vehicle. A Member shall not be required to participate in a Company Investment directly through an Alternative Investment Vehicle (as defined in Section 5.71.1(b) below) unless it consents in advance to the use of the Alternative Investment Vehicle. With the prior written approval SCERS, the Manager shall also be permitted to structure the making of all or any portion of a Company Investment outside of the Company through a limited partnership, limited liability company or other vehicle or vehicles (other than the Company) that will invest on a parallel basis with or in lieu of the Company, as the case may

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be (any such structure or vehicle an “Alternative Investment Vehicle”). Members participating in an Alternative Investment Vehicle shall make capital contributions directly to such Alternative Investment Vehicle to the same extent, for the same purposes and on the same terms and conditions as Members are required to make Capital Contributions to the Company, and such capital contributions shall reduce the unpaid Capital Commitments of the Members to the same extent as if Capital Contributions were made to the Company with respect thereto. Each such Member shall have the same economic interest in all material respects Company Investments made pursuant to this Section 5.70 as such Member would have if such Company Investment had been made solely by the Company, and the other terms of such Alternative Investment Vehicle shall be substantially identical in all material respect to the those of the Company, to the maximum extent applicable; provided, that such Alternative Investment Vehicle (or the entity in which such Alternative Investment Vehicle invests) shall provide for the limited liability of its members or limited partners as a matter of the organizational documents of such Alternative Investment Vehicle (or the entity in which such Alternative Investment Vehicle invests), and the Company, the Manager, or an Affiliate thereof, shall serve as the manager (or in a substantially similar capacity) or as investment adviser with respect to such Alternative Investment Vehicle. The determination of distributions and allocations pursuant to Sections 4 and 13hereof (and payment of the Management Fee) shall be calculated by treating investments made by any Alternative Investment Vehicle as having been made by the Company. Notwithstanding the foregoing, such distributions and allocations with respect to a particular Alternative Investment Vehicle may be calculated separately from those of the Company (and vice versa) if, in the determination of the Manager, with the approval of SCERS, such aggregation would increase the likelihood of any tax consequences or legal or regulatory constraints or create contractual or business risk that would be undesirable for the Company or any if its Members. LIABILITY OF MEMBERS. Liability of Manager, etc. Neither the Manager, other [Manager Entities], the Key Persons, nor their respective directors, officers, personnel, employees, agents or Affiliates (“Manager Parties”) shall be liable to any Member or the Company for any action or omission in relation to the Company or any transaction contemplated hereby taken in good faith and in a manner that such Person reasonably believed to be in or not opposed to the best interests of the Company, or for losses due to such action, or inaction, or for the conduct of any third party agent of the Company, provided that such agent was selected and monitored with reasonable care. Additionally, the Manager Parties may consult with counsel and accountants in respect of Company affairs and be fully protected and justified in any action or inaction that is taken in accordance with the advice or opinion of such counsel or accountants, provided that they were selected with reasonable care. Notwithstanding anything herein to the contrary, however, this Section 0 shall not relieve any Manager Party from any liability resulting from such Manager Party’s Disabling Conduct. Liability of Members. Except as required by law or as expressly provided herein, no Member shall be liable for the expenses, liabilities, or obligations of the Company (provided that each Member shall be obligated to contribute its Capital Commitment the Company).

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No Obligation to Replenish Negative Capital Account. Except as otherwise provided for by law or expressly provided herein, no Member shall have any obligation at any time to contribute any funds to replenish any negative balance in its Capital Account. Return of Distributions. If and to the extent that the Members have contributed all of their Capital Commitments and the assets of the Company are not sufficient to satisfy the Company’s obligations to a Portfolio Fund pursuant to a clawback or similar provision in the documents governing the Portfolio Fund, then the Members shall, on demand by the Manager, return Distributions to the Company as follows: each Member shall return its share of such obligation, which share shall be determined first on the basis of Distributions the Member received from the Company under Section 0(ii) and (iii) as compared to all Distributions by the Company under such provisions, and to the extent such obligation exceeds such returned Distributions, then in accordance with Percentage Interests, equitably and appropriately taking into account any prior return of Distributions under this provision; provided that no Member shall be required to return Distributions under any clause of this Section 0 after the third anniversary of the dissolution of the Company. Not Liable for Return of Capital. None of the Manager, or any Key Person shall be personally responsible for the return of Capital Contributions of any Member or any portion thereof or interest thereon, and such return shall be made solely from available Company assets, if any. EXPENSES; MANAGEMENT FEE. Management Fee. The Company shall pay to the Manager an annual management fee in an amount equal to the following (the “Management Fee”): [To be determined by the parties.] Expenses. The Manager shall bear all normal operating expenses incurred in connection with the management of the Company, except for those expenses borne directly by the Company as set forth in this Agreement. Such normal operating expenses to be borne by the Manager shall include, without limitation, expenditures on account of salaries, wages, travel, entertainment, and other expenses of the Company’s employees and of the Manager’s managers and employees, all out of pocket expenses of preparing and distributing reports to the Members and of holding Company meetings, rentals payable for space and equipment used by the Manager or the Company, professional services such as bookkeeping, attorneys and other advisors to the Manager, costs associated with strategic meetings, due diligence meetings, and any other meetings among SCERS, the Manager, managers of Portfolio Funds, and/or principals of portfolio companies, including the costs of any out of pocket expenses incurred by SCERS, or a representative of SCERS, in connection therewith, any finders’ fees or placement fees for investments by the Company, and all normal expenses incurred in investigating and evaluating Fund Investment opportunities and in managing investments of the Company, including any travel expenses of the Manager and its respective employees and agents. The Company shall bear all costs and expenses incurred in connection with purchase, holding, sale or exchange of Company Investments, Temporary Investments, and other

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Securities, real property or personal property taxes on investments, audit and accounting fees, taxes applicable to the Company on account of its operations, and fees incurred in connection with the maintenance of bank or custodian accounts. The Company shall also bear all legal and accounting fees relating to the Company and its activities, and all expenses that are not normal operating expenses, provided that all costs and expenses related to Company Investments and potential Company Investments that are also incurred on behalf of or with respect to Other Managed Entities shall be shared pro rata with the Company and such Other Managed Entities. Each party shall bear its own costs in connection with the formation and organization of the Company and the Manager, including legal and accounting fees, if any, and expenses incident thereto. The Company shall bear all liquidation costs, fees, and expenses incurred in connection with the winding up of the Company at the end of the Company’s term, specifically including, but not limited to, legal and accounting fees and expenses. BOOKS AND RECORDS; REPORTS TO MEMBERS. Books and Records. The Manager shall keep or cause to be kept complete and appropriate records and books of account in which shall be entered all such transactions and other matters relative to the Company’s business that are required by the Act or this Agreement. Except as otherwise expressly provided herein, such books and records shall be maintained in accordance with generally accepted accounting principles consistently applied. The books and records shall be maintained at the specified office of the Company referred to in Section 0, and all such books and records shall be available for inspection or copying by any Member or its representative during ordinary business hours upon reasonable notice to the Manager. The Manager hereby agrees to preserve all financial and accounting records pertaining to this Agreement during the term of this Agreement and for six (6) years thereafter, and during such period SCERS or any other instrumentality of the State of Washington, upon reasonable notice and during business hours, shall have the right, at its sole cost and expense, to audit such financial and accounting records to the fullest extent permitted by law. Upon its removal, the Manager shall deliver such records to the successor manager or, if there is no successor manager, to SCERS. Notwithstanding any such delivery of records upon removal, the Manager shall be permitted to retain copies of any and all records relating to formation, operation and liquidation of the Company as it deems necessary or appropriate to meet its accounting, tax and legal requirements or to substantiate a track record. Tax Information. The Manager shall use reasonable commercial efforts (subject to the availability on a timely basis of all necessary information from Portfolio Companies) to send, within ninety (90) days after the end of each Fiscal Year, to each Person who was a Member at any time during such year such Company tax information as shall be necessary for the preparation by such Person of its federal tax returns (including information returns). Upon the reasonable request of any such Person, the Manager will furnish to such Person such additional
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information as is reasonably available to the Manager with respect to the Company as may be necessary to file other required returns or reports with governmental agencies. The Manager shall notify the Members of any available tax refunds, credits or exemptions (including exemptions from withholding) promptly in writing after the Manager becomes aware thereof. Tax Matters Partner. Each of the Members hereby designates the Manager as, and delegates to the Manager all right, power and authority to act as and perform the duties of, the “tax matters member” of the Company for all purposes of Section 6231 of the Code, and the Manager shall have all such rights, powers and authority and shall have and discharge all of the obligations of such a “tax matters member.” The Manager shall provide written notice to each Member promptly after it has learned of any audit by the Internal Revenue Service of the Company. Any Member designated as the “tax matters member” for the Company under Section 6231 of the Code shall be, to the fullest extent permitted by law, indemnified and held harmless by the Company from any and all liabilities and obligations that arise from or by reason of such designation in the absence of Disabling Conduct by such Person. Reports to Members. The Manager shall use its reasonable commercial efforts to send to the Members, within ninety (90) days after the end of each quarter of each Fiscal Year, unaudited financial statements. The Manager shall use its reasonable commercial efforts (subject to the availability on a timely basis of all necessary information from each Investment) to send, within one hundred twenty (120) days after the end of each Fiscal Year, audited financial statements (“Annual Financial Statements”). At the time of any Distribution, including any Distribution pursuant to Section 0, the Manager shall provide to the Members the details of the calculation of such Distribution. The Manager shall use reasonable commercial efforts to obtain similar information from the managers of Portfolio Funds and shall provide all such information obtained to the Members. The Manager shall cause an audit of the Annual Financial Statements of the Company to be made by independent certified public accountants of recognized national standing and experienced in auditing investment limited liability companies or partnerships, which audit shall be conducted in accordance with generally accepted auditing standards, and the Annual Financial Statements shall be accompanied by a report of such accountants. The Manager shall authorize such accountants to respond to questions from and otherwise provide explanations to SCERS upon SCERS’ reasonable request. The Manager shall use best efforts to provide the Members prompt notice, which in any case shall not be more than three (3) Business Days, of the occurrence of any of the following: The transfer of the Manager’s interest to an Affiliate pursuant to Section 0;

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The designation of a new person to serve as a Key Person, subject to SCERS’ approval; A change in the location of any office used by the Manager for the Company; or Any Change in Control. The Manager shall disclose to SCERS any finder’s fees or placement fees that the Manager or any Affiliate incurs in connection with Company Investments, and provide such additional information regarding such fees as SCERS may request. Upon the request of SCERS, the Manager will furnish to SCERS such additional information as SCERS shall reasonably request and is reasonably available to the Manager with respect to the business and investments of the Company. SCERS may require, at the expense of the Company, the conduct of a forensic audit by an independent accounting firm selected by SCERS. The Manager will provide to SCERS (i) on line access to the information described in this Section 0 regarding the portfolio through a secure on line system; and (ii) upon request, access to all the documents relating to Company Investments, including offering materials, partnership agreements of Fund Investments, subscription documents, side letters and legal opinions. Meetings. On a quarterly basis and at any other time upon the reasonable request of SCERS, the Manager shall meet with SCERS in person or by audio or telephone conference to discuss the Company’s strategic direction and investment prospects. In particular the Manager shall: [To be discussed by the parties] Consider requests for SCERS’ consent as required under this Agreement, and consult with the SCERS regarding any action that would give rise to a Conflict involving the Manager or any of its Affiliates or any Company Investment or Portfolio Company; Review valuations pursuant to Section 0; Provide information regarding deal flow, investment allocations, portfolio developments, the financial performance of the Company, Target Investment Opportunities, Fund Investments, and Portfolio Companies, including performance in respect of the Investment Plan, realization plans, progress toward achieving prior realization plans, and efforts and accomplishments with respect to investments (direct and indirect); In accordance with a knowledge transfer program to be developed by the parties, discuss with SCERS investment strategies, general market conditions, due diligence and monitoring procedures, and such other matters as may be requested by SCERS; Arrange introductions and meetings for representatives of SCERS with managers of Portfolio Funds and other investment managers in the marketplace;

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Advise SCERS of personnel changes, including changes in the Manager or the Key Persons, or their respective Affiliates participating in the management of the Company, that are reasonably likely to have a material adverse effect on the Company or the Manager; and Advise SCERS of the activities of the Company and the Manager since the last meeting of the Manager and SCERS, and discuss such additional matters as the Manager may from time to time refer to SCERS. Section 754 Election. The Manager shall make an election under Section 754 of the Code at the request of a Member. The Member making the election request shall bear the cost of such election and any on going costs related to the election. Compliance with Law. The Manager will ensure that the Company and the Manager comply with all applicable law, including the laws of the State of Washington; the Charter, Municipal Code, and ordinances of The City of Seattle; and rules, regulations, orders, and directives of their administrative agencies and the officers thereof. The Members shall cooperate with the Manager in providing such information as the Manager may from time to time reasonably request for purposes of complying with such requirement. The Manager, at no expense to SCERS, shall secure and maintain during the term of this Agreement all required licenses, permits and similar legal authorizations and shall comply with the requirements thereof. The Manager shall ensure that the Company shall pay, before delinquency, all taxes, levies, and assessments (i) on the Company arising from its activities under this Agreement, and (ii) on the Manager arising from its activities under this Agreement. Confidentiality. Except as otherwise provided in this Section 0, the parties may use Confidential Information solely for purposes related to the Company and no other purpose whatsoever, and shall keep it strictly confidential and not disclose it to any Person, except (i) Persons who need to know the Confidential Information solely for purposes of the Company and who acknowledge the confidential nature of the Confidential Information and agree to maintain its confidentiality as if they were subject to this Agreement, and (ii) disclosures of Confidential Information required by law or legal process. The Manager acknowledges that SCERS is a public agency subject to state laws, including, without limitation, the Open Public Meetings Act (contained in Chapter 42.30 Revised Code of Washington) and the Washington State Public Records Act (contained in Chapter 42.56 Revised Code of Washington) (the “Public Records Act”), which provides generally that all records relating to a public agency’s business are open to public inspection and copying unless exempted under the Public Records Act, and that, as a result, SCERS may be required to disclose certain Confidential Information to the public. The Manager acknowledges that all writings, which include all means of recording any form of communication or representation, provided by the Manager to SCERS become public records and may be subject to public disclosure under the
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Public Records Act, notwithstanding that the Manager has designated information in such records as confidential. The Manager agrees that SCERS is permitted to disclose Company Level Information and Portfolio Level Information and that such disclosure shall not constitute a breach of the Agreement. In the event SCERS receives a request to disclose Confidential Information, SCERS shall use reasonable efforts to (i) promptly notify the Manager of such information request, (ii) promptly provide the Manager with a copy of such information request or a summary of the information being requested and the timing for responding, and (iii) provide the Manager a reasonable opportunity to seek appropriate legal action regarding such disclosure, if any. Neither the Manager nor any party associated with the Manager in connection with the Agreement shall make any claim against SCERS if it makes available to the public any Confidential Information that SCERS determines in good faith is required to be made public pursuant to the Public Records Act or any legal proceeding, and SCERS shall not be liable to the Manager or any third party for such disclosure. Any acknowledgement or agreement concerning the disclosure or confidentiality of information, or the use thereof, that is required as a condition to gaining access to any website on which Company documents or reports are made available or delivered under this Agreement shall be subject to (and superseded by) the terms of this Agreement. TRANSFERS, ETC. Transfer by Manager. Neither the Manager nor any Key Person shall take any action to effect any sale or transfer that would constitute a Change in Control without providing notice to SCERS pursuant to Section 0. The Manager may assign, pledge, encumber or otherwise transfer its membership interest in the Company, in whole or in part, (i) only with the consent of SCERS (which may be given or withheld in the sole discretion of SCERS) and (ii) subject to Section 0; provided, however, that the Manager may transfer its interest in the Company to an Affiliate without the consent of SCERS upon prior notice to SCERS, so long as there is no Change in Control with respect to the Manager. Withdrawal of Manager. The Manager shall not voluntarily withdraw from serving as the manager of the Company or voluntarily effect or take any action toward any dissolution, voluntary filing for bankruptcy or winding up of the Manager. Removal of Manager. SCERS shall have the right, at any time and in its sole discretion to remove the Manager at any time without cause, by giving ______________ (_____) days written notice (“No Fault Removal”). During such ________ day period, the Company shall not make any new Company Investments other than completion of transactions with respect to which the Company had made a binding commitment to invest as of the date notice of removal was given to the Manager or Company Investments otherwise approved by SCERS (and, for the avoidance of doubt, the Company may satisfy Company obligations to existing Portfolio Funds). The No Fault Removal shall be effective at the end of the _______ day period.

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In addition to all other rights at law or in equity, SCERS shall have the right to remove the Manager for cause upon the occurrence of Disabling Conduct committed by the Manager or the Key Persons (“Removal for Cause”), by giving notice to the Manager, which notice shall specify the effective date of removal. Upon the occurrence of No-Fault Removal or Removal for Cause, the Manager shall cease to be the manager of the Company, and thereafter neither the Manager nor its successors in interest shall have any of the powers, obligations or liabilities of a manager of the Company under this Agreement or under applicable law, arising after the date of such removal. The Manager acknowledges and agrees that, to the extent permitted by applicable law, the Members shall have the right to equitable remedies (including without limitation a right to obtain a temporary restraining order, preliminary injunction and permanent injunction) to enforce their rights under this Section 0, without regard to whether an adequate remedy at law may exist or monetary damages would be available. Except as provided in Section 0 below, upon the occurrence of any Event of Withdrawal, the Company shall be dissolved and wound up in accordance with Sections 0 and 0, and neither the Manager nor its successors in interest during such dissolution of the Company shall have any of the powers, obligations or liabilities of a manager of the Company under this Agreement or under applicable law and the Manager or its successors in interest shall have only the rights of a transferee of the Manager’s economic interest in profits and losses and Distributions (in accordance with Section 0). Notwithstanding Section 0, upon the occurrence of any Event of Withdrawal, the Company shall not be dissolved if, within ninety (90) days thereafter, SCERS elects to continue the business of the Company and appoints another Person to serve as the successor manager. The Manager shall assist in the transfer of its duties and obligations under this Agreement to the successor manager. Any successor manager or managers appointed by SCERS pursuant to this Section 0 shall receive such Management Fee and shall have such interest in the profits, losses and Distributions of the Company as are determined by SCERS. All Members hereby consent to the amendment of this Agreement and the Certificate of Formation to effect the removal of the Manager, the substitution of one or more managers in its stead, the payment of Management Fee to the successor manager, and the granting to the successor manager of an interest in the profits, losses and Distributions of the Company. [Consequences of Event of Withdrawal shall include right of SCERS to buy out the Manager’s interest at fair market value, and, in the case of Removal for Cause, other appropriate consequences.] [To be discussed in more detail by the parties.] Transfer by Members. Subject to Section 0, no Member may assign or otherwise transfer all or a portion of its interest in the Company to one or more other Persons; provided that SCERS may assign its interest in the Company to an Affiliate. Certain Restrictions on Transfers. Notwithstanding any other provision of this Agreement, to the fullest extent permitted by law, no Member may assign or otherwise transfer in any manner whatsoever all or any part of its interest in the Company, and no attempted or purported assignment or transfer of such interest shall be effective, unless (a) such assignment or

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transfer would not cause the Company to become taxable as a corporation under the Code, (b) such assignment or transfer would not result in a violation of applicable law, including the federal securities laws, or any term or condition of this Agreement, (c) such assignment or transfer would not result in a requirement that the Company register as an investment company under the Investment Company Act of 1940, as amended, and (d) such assignment or transfer is to a Qualified Investor. Further Actions. The Manager or its successor shall cause this Agreement and the Certificate of Formation to be amended to reflect as appropriate the occurrence of any of the transactions referred to in this Section 9.60, as promptly as is practicable after such occurrence. DURATION AND TERMINATION OF THE COMPANY. Duration. The term of the Company commenced on the date of the filing of the Certificate of Formation pursuant to the Act and shall continue until the occurrence of an Event of Dissolution. Winding Up. Upon the occurrence of an Event of Dissolution, the business of the Company shall be wound up. The Manager shall proceed with the liquidation and distribution of the Company’s assets, provided, however, that SCERS shall have the right to appoint another Person to act as liquidating trustee (the liquidating trustee so chosen by SCERS, or the Manager acting in the capacity of liquidating trustee, is herein called the “Liquidator”). The Liquidator shall be responsible for completing a Dissolution Sale to the extent necessary to pay creditors all amounts described in Section 0 below and to distribute the remaining Company assets (including the balance on account in the Reserve and Securities of Portfolio Companies, where available) to the Members, in cash or in kind and as set forth in Section 0 below. The Liquidator shall have the power to set aside reasonable reserves for the payment of any contingent, conditional or unmatured obligations of the Company. In any such Dissolution Sale, such Liquidator shall use its best efforts to reduce the Securities held by the Company to cash, subject to obtaining fair market value for such Securities and any tax or legal considerations. Final Distribution. The Profit or Loss of the Company from the Dissolution Sale shall be allocated to the Members’ Capital Accounts in accordance with Section 13 0 of this Agreement. All unrealized gains or unrealized losses on any Securities remaining in the Company after the Dissolution Sale shall be deemed to be realized for the purposes of final allocations to the Capital Accounts of the Members pursuant to Section 130. The cash and any other property remaining in the Company after the Dissolution Sale shall be applied or distributed as a final Distribution (a “Final Distribution”) in one or more installments (or reasonable provisions made therefore) in the following order of priority: To creditors of the Company (whether by payment or the making of reasonable provision for the payment thereof), including Members who are creditors, in the order of priority as provided by the Act or other applicable law; and To the Members in accordance with Section 0. Termination. The Company shall terminate when all of the assets of the Company, after payment of or due provision for all debts, liabilities and obligations of the Company, shall have
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been distributed to the Members in the manner provided for in Section 0, and the Certificate of Formation shall have been canceled in the manner required by the Act. REPRESENTATIONS AND WARRANTIES. Representations and Warranties of the Company. warrants to the Members that: The Company represents and

Organization and Authority of the Company. The Company is duly organized and validly existing as a limited liability company under the laws of the State of Washington and has all requisite power and authority to carry on its business as now conducted and as proposed to be conducted as described in this Agreement (including all attachments hereto). Authorization of Agreement, etc. The execution and delivery of this Agreement have been authorized by all necessary action on behalf of the Company, and this Agreement is valid, binding, and enforceable against the Company in accordance with its terms. Compliance with Laws and Other Instruments. The execution and delivery of this Agreement by the Company and the consummation of the transactions contemplated hereby (i) will not require the consent or approval of any Member that has not been lawfully and validly obtained, (ii) will not require the Company to obtain or make any authorization, consent, approval, license, exemption of or filing or registration with any court or governmental department, commission, board, bureau, agency or instrumentality that has not been lawfully and validly obtained, (iii) will not cause the Company to violate or contravene (A) any provision of law applicable to the Company, (B) any rule or regulation of any governmental authority (federal, state, local or foreign) applicable to the Company, or (C) any order, writ, judgment, injunction, decree, determination or award binding upon the Company, and (iv) will not violate or be in conflict with or result in any breach of or constitute (with or without notice or lapse of time or both) a default under any provision of this Agreement, any agreement or other instrument to which the Company is a party or by which the Company or any of its properties are bound, or any license, permit, franchise, judgment, decree, award, statute, rule or regulation applicable to the Company or its businesses or properties. Representations and Warranties of the Manager. warrants to the Members that: The Manager represents and

Organization and Authority of the Manager. The Manager is duly organized and validly existing as a ____________________ under the laws of the State of _______________ and has all requisite power and authority to execute, deliver and perform its obligations under this Agreement and to carry on its business as now conducted and as proposed to be conducted as described in this Agreement. Authorization of Purchase. The Manager has the full power and authority to purchase an Interest hereunder. The purchase of an Interest has been duly authorized by all necessary action on its behalf.

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Authorization of Agreement, etc. The execution and delivery of this Agreement have been authorized by all necessary action on behalf of the Manager, and this Agreement is valid, binding, and enforceable against the Manager in accordance with its terms. Compliance with Laws and Other Instruments. The execution and delivery of this Agreement by the Manager and the consummation of the transactions contemplated hereby (i) will not require the consent or approval of any Member that has not been lawfully and validly obtained, (ii) will not require the Manager to obtain or make any authorization, consent, approval, license, exemption of or filing or registration with any court or governmental department, commission, board, bureau, agency or instrumentality that has not been lawfully and validly obtained, (iii) will not cause the Manager to violate or contravene (A) any provision of law applicable to the Manager, (B) any rule or regulation of any governmental authority (federal, state, local or foreign) applicable to the Manager, respectively, or (C) any order, writ, judgment, injunction, decree, determination or award binding upon the Manager, and (iv) will not violate or be in conflict with or result in any breach of or constitute (with or without notice or lapse of time or both) a default under any provision of this Agreement, the limited partnership agreement governing the Manager, or any agreement or other instrument to which the Manager is a party or by which the Manager or any of its respective properties are bound, or any license, permit, franchise, judgment, decree, award, statute, rule or regulation applicable to the Manager its respective businesses or properties. Accuracy of Information. Except to the extent modified by this Agreement, none of the information furnished by or on behalf of the Company or the Manager or any Affiliate of the Manager in its Response to RFP or in any presentation to SCERS about the Company, the Manager and any Affiliate of the Manager or in connection with the Response to RFP contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements therein not misleading. Offer of Interests. Neither the Company nor anyone acting on its behalf has taken or will take any action that would subject the issuance and sale of limited liability company interests in the Company (“Interests”) to the registration and prospectus delivery provisions of the Securities Act. Investment Company Act; Advisers Act. The Company is not required to register as an “investment company” under the Investment Company Act. As of the date hereof, the Manager [and/or the Investment Advisor] is registered as an investment adviser under the Advisers Act. Litigation Matters. To the knowledge of the Manager or any of the Key Persons, there is no legal action, suit, arbitration or other legal, administrative or other governmental investigation, inquiry or proceeding (whether federal, state, local or foreign) pending or threatened against or involving (x) the Company or any of its properties, assets or business, (y) the Manager or any of its properties, assets or business, or (z) any [Manager Entity], that would have a material

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adverse effect on the Company and, in the case of preceding clauses (y) and (z), claims or alleges breach of fiduciary duty, fraud, misrepresentation, willful misconduct, a violation of the Racketeer Influenced Corrupt Organizations Act or a violation of any federal or state securities law, rule or regulation or any federal or state law, rule or regulation enacted for the protection of banks, thrift institutions, pension plans, broker dealer customers, investment advisory clients, insurance companies or other financial institutions; and During the preceding five (5) years, neither the Manager nor any Key Person has (x) been the subject of any actual action, suit, arbitration, legal, administrative, or other governmental investigation, inquiry or proceeding (whether federal, state, local or foreign) of the type described immediately after clause (z) of Section 0 where the claim or payment of damages was in excess of $50,000, or (y) settled any actual or threatened action, suit, arbitration, legal, administrative, or other governmental investigation, inquiry or proceeding (whether federal, state, local or foreign) of the type described immediately after clause (z) of Section 0 where the claim or payment of damages was in excess of $50,000. [Manager Entity]. Other than ______________ and the individual partners of the Manager, no Persons have a direct or indirect interest in the Manager. Disclosure of Conflicts. The Manager has provided to SCERS a true copy of any agreement the Manager may have with any third party for placement of the account. The Manager hereby covenants, represents and warrants that no trustee, employee, consultant, agent or other person acting for SCERS, either directly or indirectly, will receive anything of value from the Manager, or from a third party or other person acting for the Manager, in connection with the placing of the Account with the Manager. The Manager confirms that to the best of its knowledge, the Manager does not have a business interest or a relationship with (1) any City of Seattle officer or employee who was, is or will be involved in the selection of the Manager for work under this Agreement, or the negotiation, preparation, execution, administration, or evaluation of the Manager’s performance; or (2) any of the following (all of whom shall be identified by SCERS): (1) a current SCERS Board Member or any person who had been a SCERS Board Member within the last five years, (2) a SCERS employee in a position of management, (3) a SCERS consultant, (4) a current or former

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elected official of the City of Seattle that has served in such position within the last five years, or (5) a current department head of the City of Seattle. As used in this section, the term “Manager” shall include any employee of the Manager who was, is, or will be involved in the negotiation, preparation, execution, administration, or performance of the Agreement. The Manager shall disclose all campaign contributions made by it, or its officers and employees, to any campaign committee of a SCERS Board member or to a campaign committee of any current or former elected official of the City of Seattle that has served in such position within the last five years (collectively, “Elected Officials”), in each case made within the preceding twenty-four (24) months prior to the execution of this agreement, and upon SCERS’ request shall disclose any subsequent campaign contributions, provided that SCERS shall provide the Manager with a list of Elected Officials in connection with any such request. This restriction is not intended to prohibit a campaign committee from engaging in lawful political solicitations, provided that full disclosure is made, as required by law, to the appropriate authorities. The Manager may not make campaign contributions to SCERS Board members, except to campaign committees. Violation of this Section 11.2(j)(iii) constitutes a breach by the Manager of this Agreement. The Manager confirms that to the best of its knowledge, no compensation has been or will be paid by the Manager or any of its principals, employees, agents or affiliates to any person or entity to act as a placement agent, finder or other analogous entity in connection with this Agreement. In the event that the Manager intends to utilize for work under this Agreement (whether as an employee or sub-Manager) any person who the Manager knows was employed by the City of Seattle at any time during the twelve (12) months immediately prior to such proposed utilization, the Manager shall give notice of such intention to the Executive Director of SCERS, identifying by name the person to be so utilized. The Manager shall not knowingly utilize any former City of Seattle employee who, in the course of his/her City of Seattle employment, was involved or participated in, or acted on any matter related to the Manager’s services under this Agreement and whose City of Seattle employment was ended within the twelve (12) months immediately preceding such proposed utilization by the Manager. Acknowledgments, Representations and Warranties of the Members.

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Each Member acknowledges that: The Interests have not been registered under the Securities Act. It must bear the economic risk of its investment in the Interest for an indefinite period of time because the Interests have not been registered under the Securities Act and, therefore, cannot be sold or otherwise transferred unless they are subsequently registered under the Securities Act or an exemption from such registration is available, and it will have no right to cause any registration of the Interests under the Securities Act. The Company may make investments that may involve risk and there is no assurance as to the performance of, or rate of return on, any such investment. The Manager has not provided legal or tax advice relating to the structure of the Interests and distributions related thereto and it has relied on its own professional advisors as to all matters relevant to the suitability of such structure. It is the intention of the Members that the Company be treated as a partnership for federal income tax purposes and, by executing this Agreement, each of the Members hereby consents to any election made by the Tax Matters Partner for the Company to be treated as a partnership for federal income tax purposes. Each Member represents and warrants and agrees with the Company and the Manager that: It has the full power and authority to execute and deliver this Agreement and to purchase an Interest hereunder. The purchase of an Interest and execution and delivery of this Agreement have been duly authorized by all necessary action on its behalf, and this Agreement is valid and binding against it in accordance with its terms. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby will not conflict with or result in any violation of or default under any agreement or other instrument to which the Member is a party or by which the Member or any of its properties is bound, or any license, permit, franchise, judgment, decree, award, statute, rule or regulation applicable to the Member or its properties. There is no legal action, suit, arbitration or other legal, administrative or other governmental investigation, inquiry or proceeding (whether federal, state, local or foreign) pending or, to the knowledge of the
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Member, threatened against or affecting the Member or any of its properties, assets or business which could have a material impact on the Member’s ability to perform its responsibilities under this Agreement. It is acquiring the Interest it is purchasing for investment purposes only, for its own account and not as nominee or agent for any other Person, and in any case not with a view to the sale or distribution of any or all thereof. It has no present intention of selling, granting a participation in, or otherwise distributing the same, and it will not offer, sell, transfer or assign such Interest or any interest therein in contravention of the Securities Act, any state or federal law or this Agreement, and it has no contract, understanding, agreement or arrangement with any Person to sell, transfer or grant a participation to such Person or any other Person, with respect to any or all of such Interest. It understands that the Interests are not being registered under the Securities Act in reliance upon an exemption which is in part predicated on the representations, warranties and agreements made by it in this Section 0. It is an “accredited investor” within the meaning of Regulation D under the Securities Act or has such knowledge and experience in financial and business matters that it is capable of evaluating the merits and risks of an investment in the Interest and is able to bear the economic risk of that investment. It is not formed for purposes of making its investment in the Interest and is neither required to register as an investment company under the Investment Company Act, nor claiming exemption from registering as an investment company pursuant to Section 3(c)(1) or 3(c)(7) of the Investment Company Act. The foregoing representation and warranty will be true at each time the Member makes payments of Capital Contributions required by this Agreement; and, if requested to do so by the Manager, the Member will formally confirm the foregoing representation and warranty at each such time. It is a “qualified purchaser” as defined in Section 2(a)(51)(A) of the Investment Company Act and the rules and regulations thereunder. It has carried out thorough due diligence as to and established the identities of its Related Persons, and to the extent applicable, holds the evidence of such identities, will maintain all such evidence for at least five (5) years from the date of the Member’s complete

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redemption from the Company, and will make such information available to the Manager upon its request. To the knowledge of the Member, the proposed investment in the Company that is being made on the Member’s behalf is not an investment that contravenes United States federal, state, or other laws or regulations, including anti money laundering laws (a “Prohibited Investment”); provided, that this representation and warranty shall not cover any actions taken or omitted to be taken by the Manager or any of its Affiliates. Neither the Member nor, if applicable, any Related Person is a prohibited country, territory, person or entity named on an OFAC (U.S. Treasury Department’s Office of Foreign Assets Control) list. Neither the Member nor, if applicable, any Related Person, is a foreign bank without a physical presence in any country other than a foreign bank that (A) is an affiliate of a depositary institution, credit union or foreign bank that maintains a physical presence in the United States or a foreign country, as applicable, and (B) is subject to supervision by a banking authority in the country regulating such affiliated depositary institution, credit union, or foreign bank. A foreign bank described in the preceding clauses (A) and (B) is referred to herein as a “Regulated Affiliate”, and a foreign bank without a physical presence in any country that is not a Regulated Affiliate is referred to herein as a “Foreign Shell Bank”. Except as otherwise disclosed to the Manager in writing: (A) neither the Member nor, if applicable, any Related Person, is resident in, or organized or chartered under the laws of, (1) a jurisdiction that has been designated by the Secretary of the Treasury under Section 311 or 312 of the USA PATRIOT Act of 2001, as amended (the “Patriot Act”), as warranting special measures due to money laundering concerns, or (2) any foreign country that has been designated as non cooperative with international anti money laundering principles or procedures by an intergovernmental group or organization, such as the Financial Action Task Force on Money Laundering, of which the United States is a member and with which designation the United States representative to the group or organization continues to concur (a “Non-Cooperative Jurisdiction”); (B) the subscription funds of the Member do not originate from, nor will they be routed through, an account maintained at (1) a Foreign Shell Bank, (2) a foreign bank (other than a Regulated Affiliate) that is barred, pursuant to its banking license, from conducting banking activities with the citizens of, or with the local currency of, the country that issued the license, or

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(3) a bank organized or chartered under the laws of a Non Cooperative Jurisdiction; and (C) neither the Member nor, if applicable, any Related Person, is a senior foreign political figure, or any immediate family member or close associate of a senior foreign political figure, in each case within the meaning of the Patriot Act. Any Distributions paid to it will be paid to the same account identified to the Manager as the account from which payments will be made by the Member to the Company and for Distributions from the Company to the Member, unless the Manager, in its reasonable discretion, agrees otherwise. It will promptly notify the Company if it becomes aware of any change in the information set forth in this Section 0. It believes itself capable of evaluating the merits and risks of an investment in the Company because of its knowledge and experience in financial and business matters in general and in particular with respect to this type of investment, and is able to bear these risks, including, without limitation, the risk of loss of its Capital Contributions to the Company. It has been furnished with, and has carefully read, this Agreement, including without limitation the schedules referenced herein, and has been given the opportunity to (i) ask questions of, and receive answers from, the Manager concerning the terms and conditions of the offering and this Agreement and other matters pertaining to an investment in the Company, and (ii) obtain any additional information that the Manager can obtain without unreasonable effort or expense that is necessary to evaluate the merits and risks of an investment in the Company. . MISCELLANEOUS. Waiver of Partition. Each Member hereby irrevocably waives any and all rights that it may have to maintain an action for partition of any of the Company’s property. Modifications. Except as provided in the immediately succeeding sentence, this Agreement may be modified or amended only upon execution by the Manager and SCERS of a written amendment to this Agreement or of a written amended and restated Agreement. Notwithstanding the provisions of this Section 0, the Manager shall have the authority to amend or modify this Agreement without any vote or other action by the other Members: (a) to satisfy any requirements, conditions, guidelines, directives, orders, rulings or regulations of any governmental authority, or as otherwise required by applicable law; (b) to reflect the admission of substitute, additional or successor Members and transfers of Interests pursuant to this Agreement; (c) to qualify or continue the Company as a limited liability company in all

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jurisdictions in which the Company conducts or plans to conduct business; (d) to change the name of the Company; (e) to cure any ambiguity or correct or supplement any provisions herein contained which may be incomplete or inconsistent with any other provision herein contained or to correct any typographical errors contained herein, provided, in each such case, that such amendment does not adversely affect the interests of the Members; or (g) if necessary to reflect the organization of any Investment Vehicle or Alternative Investment Vehicle as authorized herein. Entire Agreement. This Agreement, the RFP, and the Response to RFP constitute the entire agreement among the parties with respect to the subject matter hereof, and supersedes any prior agreement or understanding among them with respect to such subject matter. In the event of any conflict between this Agreement and the RFP or the Response to RFP, this Agreement shall prevail. Severability. If any provision of this Agreement, or the application of such provision to any Person or circumstance, shall be held invalid, the remainder of this Agreement or the application of such provision to other Persons or circumstances shall not be affected thereby. Notices. All notices, requests, demands and other communications hereunder shall be in writing and shall be (a) transmitted by hand delivery, (b) mailed by first class, registered or certified mail, postage prepaid, (c) transmitted by overnight courier, or (d) transmitted by facsimile and confirmed by telephone, or transmitted by electronic mail, and in each case, if to a Member, at the address set forth below with respect to such Member: If to the Manager: _____________________________ With a copy to: _____________________________ If to SCERS: _____________________________ With a copy to: K&L Gates 925 Fourth Avenue, Suite 2900 Seattle, WA 98104 7022 Telephone No. (206) 370 8358 Telecopy No. (206) 623 7022 Attention: Margaret A. Niles and if to the Company, at the address referred to in Section 0, or to such other address as the Company or any Member shall have last designated by notice to the Members or the Company

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and the other Members, as the case may be. Notices mailed or transmitted in accordance with the foregoing shall be deemed to have been given upon receipt. Governing Law. This Agreement shall be governed by the laws of the State of Washington, without regard to its principles of conflicts of law. Successors and Assigns. Except as otherwise specifically provided, this Agreement shall be binding upon and inure to the benefit of the Members and their legal representatives, successors and assigns. Counterparts. This Agreement may be executed in one or more counterparts, all of which shall constitute one and the same instrument. Headings. The section headings in this Agreement are for convenience of reference only, and shall not be deemed to alter or affect the meaning or interpretation of any provisions hereof. Actions and Power of Attorney. Each Member shall execute and deliver such other certificates, agreements and documents, and take such other actions, as may be required by law or, upon advice of counsel to the Manager, advisable and, in such case, requested by the Manager in connection with the formation of the Company and the achievement of its purposes, including, without limitation, (i) any documents that the Manager deems necessary or appropriate to form, qualify, or continue the Company as a limited liability company in all jurisdictions in which the Company conducts or plans to conduct business, and (ii) all such agreements, certificates, tax statements and other documents as may be required to be filed in respect of the Company. Subject to Section 12.10(c), each Member hereby constitutes and appoints the Manager, with full power of substitution, the true and lawful attorney in fact and agent of such Member, to execute, acknowledge, verify, swear to, deliver, record and file, in its or its assignee’s name, place and stead, all in accordance with the terms of this Agreement, all instruments, documents and certificates that may from time to time be required by the laws of the United States of America, the State of Washington, any other jurisdiction in which the Company conducts or plans to conduct its affairs, or any political subdivision or agency thereof to effectuate, implement and continue the valid existence and affairs of the Company, including the power and authority to verify, swear to, acknowledge, deliver, record and file: All certificates and other instruments, including any amendments to this Agreement or the Certificate of Formation, which the Manager deems appropriate to form, qualify or continue the Company as a limited liability company (or a company in which the members have limited liability) in the State of Washington and all other jurisdictions in which the Company conducts or plans to conduct its affairs; Any amendments to this Agreement or any other agreement or instrument which the Manager deems appropriate to (A) effect the addition,
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substitution or removal of any Member or Manager pursuant to this Agreement or (B) effect any other amendment or modification to this Agreement, but only if such amendment or modification is duly adopted in accordance with the terms hereof; All conveyances and other instruments which the Manager deems appropriate to reflect the dissolution and termination of the Company pursuant to the terms hereof, including the writing required by the Act to cancel the Certificate of Formation; Certificates of assumed name and such other certificates and instruments as may be necessary under the fictitious or assumed name statutes from time to time in effect in the State of Washington and all other jurisdictions in which the Company conducts or plans to conduct its affairs; and Any election pursuant to Section 954(b)(4) of the Code to exclude income of a “controlled foreign corporation” from classification as “subpart F income.” The power of attorney granted herein shall not be used to provide an indemnity. The power of attorney granted herein shall be deemed to be coupled with an interest, shall survive and not be affected by the dissolution, bankruptcy or legal disability of the Member, and shall extend to such Member’s successors and assigns. Any person dealing with the Company may conclusively presume and rely upon the fact that any instrument referred to above, executed by such attorney in fact and agent, is authorized, regular and binding, without further inquiry. If required, the Member shall execute and deliver to the Manager within five (5) days after the receipt of a request therefor, such further designations, powers of attorney or other instruments as the Manager shall reasonably deem necessary for the purposes hereof. Pronouns and Plurals. Whenever the context may require, any pronoun used in this Agreement shall include the corresponding masculine, feminine or neuter forms, and the singular form on nouns, pronouns and verbs shall include the plural and vice versa. Non Waiver. No provision of this Agreement shall be deemed to have been waived unless the giving of such waiver is contained in a notice given to the party claiming such waiver, and no such waiver shall be deemed to be a waiver of any other or further obligation or liability of the party or parties in whose favor the waiver was given. Construction. None of the provisions of this Agreement shall be construed as for the benefit of or as enforceable by (a) any creditor (other than Persons entitled to indemnification hereunder) of the Company or any Member, or (b) any other Person not a party to this Agreement. SCERS’ Opinion of Counsel. In the case of any opinion of counsel to be delivered by SCERS, the opinion of SCERS’ in house counsel shall constitute an opinion of counsel acceptable to the Manager and the Company.
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Prohibited Investment. Notwithstanding anything to the contrary contained herein, if, following a Member’s investment in the Company, it is discovered that the investment is or has become a Prohibited Investment, such investment may immediately be redeemed by the Company or otherwise be subject to the remedies required by law, and the Member shall have no claim against the Company, the Manager or any of its Affiliates for any form of damages as a result of such forced redemption or other action. Upon the written request from the Company, the Member agrees to provide all information reasonably requested by the Company to enable the Company to comply with all applicable anti money laundering statutes, rules, regulations and policies, including any policies applicable to a Portfolio Company held or proposed to be held by the Company. Each Member understands and agrees that the Company may release confidential information about the Member and, if applicable, any Related Persons to any person, if the Manager determines that it is necessary in light of relevant rules and regulations concerning Prohibited Investments, provided that the Manager shall promptly notify the Member if such confidential information is released unless such notification is prohibited by law. COMPANY ALLOCATIONS. [To be provided. These will be standard provisions drafted to be consistent with the distribution provisions.]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of date first above written. MANAGER: ______________ GP II, LLC By: ______________ Holdings, LLC By: Name: Title: SEATTLE CITY EMPLOYEES’ RETIREMENT SYSTEM:

By: Name: Title:

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Schedule 2.3 Investment Guidelines [To be determined by the parties.]

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Schedule 2.8 Percentage Interest Name Manager ____________ _______% Other Members ____________ _______%* Percentage Interest

SCERS

_________%

Schedule 3.1(a) Capital Call Notices

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APPENDIX C

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Appendix C
Current City of Seattle Elected Officials (as of Jan. 28, 2014) Ed Murray, Mayor Sally Clark, City Council Member Sally Bagshaw, Council Member Tim Burgess, Council Member Kshama Sawant, Council Member Jean Godden, Council Member Bruce Harrell, Council Member Nick Licata, Council Member Mike O’Brien, Council Member Tom Rasmussen, Council Member Peter Holmes, City Attorney

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APPENDIX D

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Appendix D
Current City of Seattle Department Heads (as of Jan. 28, 2014) Randy Engstrom, Interim Director – Arts & Cultural Affairs David G. Jones, City Auditor – Office of City Auditor Ben Noble, Director, City Budget Office Monica Martinez Simmons, City Clerk, City Clerk’s Office Jorge Carrasco, Superintendent, City Light Patricia Lally, Director, Seattle Office of Civil Rights Jennifer Greenlee, Executive Director, Civil Service Commission Cynthia Phillips, Manager 1, Customer Service Bureau Fred Podesta, Director, Finance and Administrative Services Steve Johnson, Director, Office of Economic Development Wayne Barnett, Executive Director, Ethics and Elections Commission Chief Gregory M. Dean, Fire Chief Sue Tanner, Hearing Examiner, Hearing Examiner Office Steve Walker, Acting Director, Office of Housing Catherine Lester, Interim Director, Human Services Department Erin Devoto, Director, Department of Information Technology Nick Harper, Director, Office of Intergovernmental Relations Rebecca Herzfeld, Interim Central Staff Director, Legislative Marcellus Turner, City Librarian Yolande E. Williams, Court Administrator, Municipal Court Bernie Matsuno, Director, Department of Neighborhoods Aaliyah Gupta, Acting Director, Office of Immigrant and Refugee Affairs Christopher Williams, Acting Superintendent, Parks and Recreation Susan Coskey, Personnel Director, Personnel Department Diane Sugimura, Director, Planning and Development Chief Harry Bailey, Interim Police Chief Terry Carroll, Commission Chair, Public Safety Civil Service Commission Ken Nakatsu, Interim Executive Director, Seattle City Employees’ Retirement System Robert Nellams, Director, Seattle Center Goran Sparrman, Interim Director, Seattle Department of Transportation Barbara Wilson, Executive Director, Seattle Planning Commission Ray Hoffman, Director, Seattle Public Utilities Jill E. Simmons, Director, Office of Sustainability and Environment

Current City of Seattle Elected Officials (as of Jan. 28, 2014) Ed Murray, Mayor Sally Clark, City Council Member Sally Bagshaw, Council Member Tim Burgess, Council Member Kshama Sawant, Council Member Jean Godden, Council Member
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Bruce Harrell, Council Member Nick Licata, Council Member Mike O’Brien, Council Member Tom Rasmussen, Council Member Peter Holmes, City Attorney

Former City of Seattle Elected Officials (within the last 5 years as of Jan. 28, 2014) Mike McGinn (former City of Seattle Mayor) Greg Nickels (former City of Seattle Mayor) Richard Conlin (former City Councilmember) Jan Drago (former City Councilmember) Richard McIver (former City Councilmember, now deceased) Tom Carr (former City Attorney) Current Seattle City Employees’ Retirement System Board of Administration (as of Jan. 28, 2014) Nick Licata, Board Chair (City Council member) Lou Walter (elected Retired Seat) Jean Becker (elected active member) Sherri Crawford (elected active member) Susan Coskey (City Personnel Director) Glen Lee (City Finance Director) Robert Harvey, Jr. (Board appointed member) Former Seattle City Employees’ Retirement System Board Members (within last 5 years as of Jan. 28, 2014) Tim Burgess (current City Councilmember and former Board Chair) David Stewart (former City of Seattle Personnel Director) Darwyn Anderson (former City of Seattle Personnel Director) Dwight Dively (former City Director of Finance) Jean Godden (current City Councilmember & former SCERS Board Chair) Frank Mathews (former SCERS Board member) Mark McDermott (former City of Seattle Personnel Director) Mary Norris (SCERS Board member – now deceased) Rod Rich (SCERS Board member – now deceased) Current Seattle City Employees’ Retirement System Staff (as of Jan. 28, 2014) Ken Nakatsu, Interim Executive Director Jeff Davis, Chief Finance/Operations Officer Anthony Smith, Investment Strategic Advisor Jill Johnson, Investment Strategic Advisor Tim Morrison, Strategic Advisor Claire Foster, IT Project Manager

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Current Seattle City Employees’ Retirement System Investment Consultant (as of Jan. 28, 2014) Neil Rue, Managing Director David Sancewich, Principal Jeremy Thiessen, Managing Director Kay Ceserani, Principal/Chief Compliance Officer Ryan Lobdell, Senior Analyst Colin Bebee, Vice President Mike Moy, Managing Director Tad Fergusson, Managing Director Current Seattle City Employees’ Retirement System Investment Consultant (as of Jan. 28, 2014) Contd Andrew Bratt, Principal Ahman Dirks, Vice President Christie Fields, Managing Director Austin Carmichael, Senior Vice President David Glickman, Managing Director

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