PRIM Emerging Manager RFP 04302012 by AWH157E

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									84 State Street, Second Floor                                            Treasurer Steven Grossman, Chair
Boston, Massachusetts 02109                                      Michael G. Trotsky, CFA, Executive Director




April 30, 2012

Dear Potential Provider:

The Massachusetts Pension Reserves Investment Management Board (“PRIM”) is
requesting a proposal from firms interested in providing emerging manager of
managers investment management services.

To be considered by PRIM, each prospective provider must respond to the Request for
Proposal (RFP) by submitting an electronic copy of its proposal via e-mail received by
3:00 p.m. EDT on Thursday, May 31, 2012, to smavromates@mapension.com. In
addition, an original and one hard copy of the proposal should be sent and received by
3:00 p.m. EDT on Thursday, May 31, 2012 to:

                                Mr. Stanley P. Mavromates, Jr.
                                Chief Investment Officer
                                Pension Reserves Investment Management Board
                                84 State Street
                                Boston, Massachusetts 02109

Further instructions for proposal submission are included in the Request for Proposal.
Questions concerning the Request for Proposal must be received electronically via
email by 3:00 p.m. EDT on Tuesday, May 15, 2012.

We appreciate the time and effort required to respond to this Request for Proposal.
Each firm submitting a proposal to PRIM can be assured that PRIM will expend
appropriate effort in evaluating the proposals. We look forward to your response.


Sincerely,



Michael G. Trotsky, CFA
Executive Director
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                      REQUEST FOR PROPOSAL (RFP)

     EMERGING MANAGER of MANAGERS INVESTMENT MANAGEMENT SERVICES

                             April 30, 2012




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                                                           Table of Contents

I. INTRODUCTION/PURPOSE .................................................................................................. 4

II. BACKGROUND INFORMATION............................................................................................ 4
   A. LEGAL STRUCTURE. ........................................................................................................................4
   B. PRIM’S ADVISORS.........................................................................................................................5
   C. GENERAL DESCRIPTION OF PRIM’S ASSETS........................................................................................5
   D. TOBACCO, SUDAN & IRAN DIVESTITURE............................................................................................5
   E. ADDITIONAL INFORMATION .............................................................................................................6
III. SCOPE OF SERVICES ........................................................................................................... 6

IV. PROPOSAL SPECIFICATIONS .............................................................................................. 8
   A. PROPOSAL DEADLINE. ....................................................................................................................8
   B. REQUIRED ATTACHMENTS AND ENCLOSURES. ....................................................................................8
   C. PUBLIC RECORD. ...........................................................................................................................9
   D. WITHDRAWAL/IRREVOCABILITY OF RESPONSES. ...............................................................................10
   E. WAIVER/CURE OF MINOR INFORMALITIES, ERRORS AND OMISSIONS. ....................................................10
   F. COMMUNICATIONS WITH PRIM. ...................................................................................................10
   G. QUESTIONS RELATING TO THIS RFP................................................................................................10
   H. INCURRING COSTS .......................................................................................................................11
   I. REJECTION OF PROPOSALS. ............................................................................................................11
V. SELECTION PROCESS ........................................................................................................ 12

VI. TENTATIVE TIMETABLE ................................................................................................... 13

VII. MINIMUM QUALIFICATIONS .......................................................................................... 14

VIII. SELECTION CRITERIA ..................................................................................................... 15
   A. STABILITY AND GENERAL EXPERIENCE OF THE FIRM. ..........................................................................15
   B. EXPERIENCE AND STABILITY OF PROPOSED TEAM DEDICATED TO PRIM ...............................................15
   C. CLIENT REFERENCES .....................................................................................................................15
   D. PROCESS ....................................................................................................................................15
   D. FEES..........................................................................................................................................16
IX. QUESTIONNAIRE ............................................................................................................. 17

X. FEE PROPOSAL ................................................................................................................. 31

XI. REPRESENTATIONS AND WARRANTIES ............................................................................ 32

XII. EXHIBITS ........................................................................................................................ 33
   A. PRIM’S STRATEGIC ASSET ALLOCATION & CURRENT INVESTMENT MANAGERS .....................................35
   B. SAMPLE INVESTMENT MANAGEMENT AGREEMENT ...........................................................................39
   C. DISCLOSURE FORMS.....................................................................................................................57
   D. PRIM INVESTMENT POLICY ..........................................................................................................62
   E – M. PERFORMANCE/POSITIONING SPREADSHEET……………………………….…….... (FILE ATTACHED)
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I.      INTRODUCTION/PURPOSE.

        The Commonwealth of Massachusetts Pension Reserves Investment
        Management (“PRIM”) Board seeks proposals to provide emerging manager of
        managers investment management services. A more detailed description of
        these services is set forth in Section III of this RFP under the heading "SCOPE OF
        SERVICES".


ll.     BACKGROUND INFORMATION.

        A.     Legal Structure.

        The PRIM Board is charged with the responsibility of investing and reinvesting
        the assets of the Pension Reserves Investment Trust (“PRIT”) Fund or, the “PRIT
        Fund”. The PRIT Fund is a pooled investment fund consisting of the assets of the
        State Employees' and Teachers' Retirement Systems as well as assets of other
        public employee retirement systems in the Commonwealth of Massachusetts
        (referred to as participating and purchasing systems). The PRIT Fund’s primary
        investment objective is to accumulate assets through investment earnings and
        other revenue sources to meet future pension liabilities. As of March 31, 2012,
        the PRIT fund had assets of approximately $50.2 billion. PRIT funds are generally
        invested with a longer-term perspective and higher target returns than most
        retirement systems. The Fund was originally established to address the
        unfunded liability of the pension system. The Massachusetts State Teachers’
        and Employees’ Retirement Systems Trust Fund (“MASTERS”) merged into the
        PRIT Fund as of December 31, 1996.

        The nine-member PRIM Board is chaired by the State Treasurer and Receiver-
        General of the Commonwealth, Steven Grossman. The Governor or his designee
        is also a member of the Board. Other members include appointees of both the
        Governor and Treasurer, and four representatives of State employees and
        teachers. All members, except the Chair, serve without compensation.

        The Board oversees the Fund under the terms of its Operating Trust dated July
        15, 1988 and most recently amended on September 22, 1998. The members of
        the Board, in conjunction with the Executive Director, who serves at the
        pleasure of the Board, determine policies and make decisions concerning the
        administrative and investment operations of the Fund.

        The PRIM Board has established advisory committees (Investment,
        Administration/Audit, Real Estate/Timber, and Compensation) to provide a
        broad range of input to the Board. These committees are generally comprised
        of Board members and private citizens with investment or business expertise.
        All significant policies and investments are ultimately approved by the Board.

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        PRIM, and persons and entities interacting with PRIM, are subject to the
        ethics/conflict of interest provisions of M.G.L. Chapter 268A (entitled “In
        Conduct of Public Officials and Employees”).


        B.     PRIM’s Advisors.

        Outside advisors are engaged for their particular expertise and retained to assist
        the Board and its staff in the areas of General Portfolio Strategy and
        Investments, Real Estate and Timber, and Private Markets. FX Transparency is
        the foreign currency consultant, Callan is the long-only consultant, NEPC is the
        asset allocation consultant, Hamilton Lane is the private equity consultant,
        Cliffwater is the direct hedge fund consultant, and Townsend provides real
        estate and timber consulting services. KPMG is the Fund’s auditor. In addition,
        KPMG is the Real Estate, Hedge Funds and Timber auditor. Deloitte & Touche is
        PRIM’s tax advisor. BNY Mellon is the Fund's custodian and is responsible for
        providing record-keeping and analytic performance for the Fund.


        C.     General Description of PRIM’s Assets.

        Exhibit A.1 includes a description of PRIM Board’s target asset allocation as of
        August 2, 2011.


        D.     Tobacco, Sudan and Iran Divestiture.

        On October 7, 1997, the Massachusetts legislature enacted, and the Governor
        signed into law, Chapter 199 of the Acts of 1997, which forbids the PRIT Fund
        from purchasing securities “of any company which derives more than 15 per
        cent of its revenues from the sale of tobacco products.” The legislation also
        required the PRIT fund to divest itself of all such securities within three years;
        this divestment was largely completed before the end of 1997. PRIM provides
        investment managers with a quarterly listing of these restricted securities.

        On November 2, 2007, the Massachusetts legislature enacted, and the Governor
        signed into law, Chapter 151 of the Acts of 2007, which forbids the PRIT Fund
        from purchasing the securities of companies determined to be doing business in
        the Sudan. The legislation required the PRIT fund to divest itself of all such
        securities within 12 months. PRIM provides investment managers with a
        quarterly listing of these restricted securities.

        On August 4, 2010, the Massachusetts legislature enacted, and the Governor
        signed into law, Chapter 232 of the Acts of 2010, which forbids the PRIT Fund

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        from purchasing the securities of companies determined to be doing business in
        Iran. The legislation requires the PRIT fund to divest itself of all such securities
        within 12 months. PRIM provides investment managers with a quarterly listing
        of these restricted securities.


        E.     Additional Information.

        Please refer to PRIM’s website at www.mapension.com to obtain additional
        information about PRIM, including the PRIM Board’s Operating Trust
        Agreement.


III.    SCOPE OF SERVICES.

        The purpose of this RFP is to solicit proposals from qualified investment
        management firms with demonstrated expertise in advisory and investment
        management services related to portfolios of emerging managers. For the
        purposes of this RFP emerging managers are defined as investment managers
        with less than $2 billion of assets under management that may have shorter
        track records or investment managers that are minority-owned or women-
        owned. PRIM’s goal via this search is to retain one or more firms to source,
        construct, and manage a portfolio of emerging managers in any one of the
        following asset classes: large cap domestic equity, small cap domestic equity,
        international equity, emerging markets equity, global equity, core fixed income,
        real estate and private equity. An investment manager may apply for more than
        one assignment, but must submit separate and distinct proposals for each asset
        class. The investment management firm(s) hired will be responsible for all
        aspects of both initial and ongoing due-diligence and monitoring. The
        benchmarks for this mandate are as follows:
             Large Cap Domestic Equity: S&P 500
             Small Cap Domestic Equity: Russell 2500
             International Equity: MSCI World ex-US IMI
             Emerging Markets Equity: MSCI EM IMI
             Global Equity: MSCI World IMI
             Core Fixed Income: Barclays Capital Aggregate
             Real Estate: NCREIF Property
             Private Equity: Russell 3000 + 3%

        PRIM’s goal is to select investment manager(s) based on PRIM’s evaluation of
        submitted Proposals in accordance with the Selection Criteria contained in
        Section VIII of this RFP. The proposing firm must be submitting a strategy in one
        of the asset classes outlined previously, and must be willing to be benchmarked
        to the corresponding index stated. Proposals submitted for other services will
        NOT be accepted. Investment manager(s) selected to perform these services
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        will be required to perform the following additional services for PRIM: (1)
        submit monthly transaction statements within two weeks of each calendar
        month end; (2) attend semi-annual performance reviews in Boston,
        Massachusetts; and (3) participate in annual on-site visits by PRIM staff.




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IV.     PROPOSAL SPECIFICATIONS.

        A.       Proposal Deadline.

              The completed proposal, which must include all attachments, must be
              received electronically via e-mail by Stanley P. Mavromates, Jr. at
              smavromates@mapension.com by 3:00 p.m. EDT on Thursday, May 31, 2012
              (the “Proposal Deadline”). Any Proposal received after the Proposal
              Deadline will not be considered. The e-mail subject header must be in the
              following format: “PRIM Emerging Mngr RFP Response – Name of
              Responding Firm.” In addition, an original and one hard copy of the
              Proposal should be sent and received by 3:00 p.m. EDT on Thursday, May 31,
              2012 to:

                               Mr. Stanley P. Mavromates, Jr.
                               Chief Investment Officer
                               Pension Reserves Investment Management Board
                               84 State Street, Suite 250
                               Boston, Massachusetts 02109

        In addition, please e-mail your proposal to viqueira@callan.com to the following
        representative of PRIM’s long-only consultant:

                                      Ms. Mildred Viqueira
                                     Senior Vice President
                                     Callan Associates Inc.
                                   200 Park Avenue, Suite 230
                                    Florham Park, NJ 07932


              All electronic documents submitted must be 10MB or smaller in size. If necessary,
              the respondent must separate the RFP submission into multiple emails to ensure
              that the size requirement is met. The respondent is responsible for ensuring that
              a complete electronic RFP response is received at PRIM prior to the Proposal
              Deadline.

              Copies of this RFP can be obtained electronically through the PRIM Board
              website at www.mapension.com.

        B.       Required Attachments and Enclosures.

        In addition to the responses to the questions, the following information must be
        attached to the firm’s response.

                 1.      Cover Letter. The Request for Proposal must be accompanied by
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                       an original and a copy of a cover letter, which will be considered
                       an integral part of the proposal, and which shall be signed by at
                       least one individual who is authorized to bind the firm
                       contractually. This cover letter must include: (a) the firm name,
                       address and telephone/fax numbers; (b) the primary contact; and
                       (c) the title or position which the signer of the cover letter holds
                       in the firm; and (d) a statement to the effect that the Proposal is
                       a firm and irrevocable offer of the proposing firm.

               2.      Representations and Warranties. The Warranties contained in
                       Section XI hereof, signed by an authorized officer of the firm,
                       must be included as an attachment to the cover letter referenced
                       in (1) above.

               3.      Disclosure Statement. Attached to this RFP as Exhibit C are two
                       Disclosure Statements, one for PRIM and one for The Public
                       Employee Retirement Administration Commission (“PERAC”).
                       Each firm submitting a Proposal must complete the two
                       disclosure forms and submit as an attachment to the cover letter
                       referenced in (1) above. YOU MUST COMPLETE BOTH PRIM AND
                       PERAC DISCLOSURE FORMS OR YOUR SUBMISSION MAY NOT BE
                       PROCESSED.

               4.      Fee Proposal. Each response must include a “Fee Proposal.”

               5.      Any additional material must be submitted separately from the
                       response.

        C.     Public Record.

        Chapter 66, Section 10 and Chapter 4, Section 7(2) (h) of the Massachusetts
        General Laws state that, upon the expiration of the Proposal Deadline, Proposals
        shall be deemed a public record and as such shall be subject to requests for
        public disclosure. However, please note Section 23(6) of chapter 32 of the
        General Laws:

        (6) Confidentiality of certain records. Any documentary material or data made or
        received by any member of the (PRIM) board which consists of trade secrets or
        commercial or financial information that relates to the investment of public trust
        or retirement funds, shall not be disclosed to the public if disclosure is likely to
        impair the government's ability to obtain such information in the future or is
        likely to cause substantial harm to the competitive position of the person or
        entity from whom the information was obtained. The provisions of the open
        meeting law shall not apply to the PRIM Board when it is discussing the
        information described in this paragraph.

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        D.     Withdrawal/Irrevocability of Responses.

        A proposer may withdraw and resubmit a Proposal prior to the Proposal
        Deadline. No withdrawals or re-submissions will be allowed after the Proposal
        Deadline.


        E.     Waiver/Cure of Minor Informalities, Errors and Omissions.

        PRIM reserves the right to waive or permit cure of minor informalities, errors or
        omissions prior to the selection of finalists, and to conduct discussions with any
        qualified respondents and to take any other measures with respect to this RFP in
        any manner necessary to serve the best interest of PRIM and its beneficiaries.

        F.     Communications with PRIM.

        PRIM’s Procurement Officer for this Request for Proposal is:

                            Mr. Stanley P. Mavromates, Jr.
                            Chief Investment Officer
                            Pension Reserves Investment Management Board
                            84 State Street, Suite 250
                            Boston, Massachusetts 02109
                            Telephone: (617) 946-8444
                            smavromates@mapension.com


        As of April 30, 2012, firms that intend to submit a Proposal should not contact
        any PRIM staff, members of the Investment Committee, members of the PRIM
        Board, employees of the Massachusetts Treasury, other than the Procurement
        Officer. An exception to this rule applies to firms which currently do business
        with PRIM, but any contact made by such firms with persons other than the
        Procurement Officer must be limited to that business, and must not relate to
        this RFP. In addition, such firms should not discuss this RFP with any employee
        of PRIM’s custodian, outside managers, consultants, legal counsel or other
        advisors.

        FAILURE TO OBSERVE THIS RULE IS GROUNDS FOR DISQUALIFICATION.

        G.     Questions Relating to this RFP.

        All questions concerning this RFP, and requests for the complete listing of
        questions and answers, must be made in writing via e-mail and must be received
        by the Procurement Officer by 3:00 p.m. EST on Tuesday, May 15, 2012 (the
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        "Question Deadline"). Questions received in accordance with this section will be
        answered and circulated by e-mail to all firms who have proposed a question or
        who request in writing a copy of the questions and the responses. Questions, or
        requests for the complete listing of questions and answers, submitted after the
        Question Deadline, will not be considered.

        H.     Incurring Costs.

        PRIM will not be liable for any costs incurred prior to entering into the Contract
        with the successful proposer or proposers.


        I.     Rejection of Proposals.

        PRIM reserves the right to reject any and all proposals.




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V.      SELECTION PROCESS.
        The Selection Process under this RFP will be as follows:

        A. Non-Qualifying Proposals.

        PRIM will evaluate each Proposal to determine if it was submitted in accordance
        with the requirements set forth in this RFP, including whether the proposing
        firm meets the minimum criteria. All non-qualifying Proposals not subject to the
        waiver/ cure of minor information will be rejected.

        B. Selection of Finalists.

        The Proposals will be evaluated by a search committee. It is anticipated that the
        search committee will include a member of the Investment Committee or its
        representative, as well as PRIM staff. Proposers may be invited to a due
        diligence interview with the search committee. Based on the Selection Criteria
        set forth in Section VIII of this RFP (including the Fee Proposals), the search
        committee will select finalists.

        C. Selection of Investment Manager(s).

        The search committee may conduct a due diligence site visit to the finalists'
        offices. The search committee will then select the finalists to recommend to the
        PRIM Investment Committee and the PRIM Board for consideration.

        The finalists recommended by the search committee may be required to make
        an in-person presentation to the Investment Committee, the PRIM Board, or
        both. The Investment Committee may accept or reject the recommendations of
        the search committee. The engagement will be awarded by the PRIM Board.




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VI.     TENTATIVE TIME TABLE.

        The following is the tentative time schedule for PRIM’s search for firms to
        provide emerging manager – US Equity small cap advisory and investment
        management services. All dates are subject to modification by PRIM with
        notice.

        Issuance of RFP:                           April 30, 2012

        RFP Question Deadline:                     May 15, 2012
                                                   3:00 p.m. EDT

        RFP Response Deadline:                     May 31, 2012
                                                   3:00 p.m. EDT

        Notification of Finalists:                 Week of June 11, 2012
        (Tentative)

        Search Committee                           Week of June 18, 2012
        Interviews: (Tentative)

        Investment Committee                       July 17, 2012
        Interviews: (Tentative)

        PRIM Board Meeting:                        August 10, 2012
        (Tentative)

        Projected                                  September 1, 2012
        Commencement Date:


** If selected for an interview, please plan to be in Boston for interviews by the search
committee, Investment Committee, and/or Board on the indicated dates.




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VII.    MINIMUM QUALIFICATIONS.

       A Proposer must meet the following minimum qualifications to be given further
       consideration in PRIM’s search for emerging manager investment management
       services. Failure of a firm to meet the minimum qualifications applicable to the
       investment management services for which it is submitting a Proposal may result
       in the Proposal’s immediate rejection.

       Basic Minimum Qualifications:

       All firms submitting Proposals must meet the following minimum criteria. Please
       provide a detailed response to each question below indicating how your firm
       meets each minimum criteria:

  1. Any person or entity providing to PRIM the services sought by this RFP must agree
     to serve PRIM as a “fiduciary” within the meaning of M.G.L. Chapter 32, and to act
     in accordance with all requirements and standards of conduct applicable to
     fiduciaries.

  2. The investment professionals must have at least a three year performance history
     building and monitoring manager of emerging manager programs, in the asset
     class(es) for which you are responding, as of March 31, 2012.

  3. The proposing firm must have at least $500 million in institutional (taxable and
     non-taxable) assets under management in manager of emerging manager
     programs, as of March 31, 2012.

  4. The proposing firm must manage at least three U.S. tax-exempt institutional
     manager of emerging manager accounts, in the asset class(es) for which you are
     responding, as of March 31, 2012.

  5. The proposing firm must be SEC-registered or exempt from registration with the
     nature of the exemption provided. The firm must submit its full Form ADV (Parts I
     and II).

  6. The proposing firm must have been in operation as an investment management
     organization for at least three years, as of March 31, 2012.

  7. The proposing firm must be willing to include the attached representations and
     warranties in the contract if selected as the manager to the PRIM Board.




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VIII.    SELECTION CRITERIA.

         PRIM will apply the following criteria in the selection of an investment
         manager(s). The search committee will assign a rating of either "Highly
         Advantageous", "Advantageous", "Acceptable", "Not Advantageous" or
         "Unacceptable" to all qualifying Proposals in each of the categories listed below.
         Any Proposal receiving a rating of "Unacceptable" in any applicable category will
         not be considered further. Using these ratings as a guide, the search committee
         will select finalists to move to the next stage of the Selection Process and
         recommend the retention of an investment manager to the Investment
         Committee. For a more detailed description of the Selection Process, see
         Section V hereof.

        A. Basic Selection Criteria Applicable to all Proposing Firms

              1. Stability and General Experience of the Firm.

                     a. Stability of the firm and the expected financial stability of the firm.

                     b. Experience of the firm in providing investment management
                        services to similar institutional investors.

              2. Experience and Stability of the Proposed Team Dedicated to PRIM.

                     a. Experience of portfolio manager(s) in providing similar services to
                        similar institutional investors.

                     b. Experience of other supporting staff in providing investment
                        management services to similar institutional investors.

              3. Client References.

                     a. Stability of the firm's client base, as measured by the number of
                        accounts gained or lost in the subject product since March 31,
                        2009.

                     b. Quality of the client references.

              4. Process.

                 Consistent process implementation, as measured by return consistency,
                 buy/sell disciplines, portfolio construction methodology, and the
                 implementation of risk controls.



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              5.   Fees.

                   The total cost of performing investment advisory services as measured
                   by the Fee Proposal.

                   In considering and evaluating responses to this RFP, PRIM will seek the
                   best balanced combination of (1) reasonable and competitive rates and
                   fees and alternative billing arrangements, and (2) demonstrated
                   strengths of experience and expertise in performing the types of
                   services sought by this RFP.




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        IX.   QUESTIONNAIRE


                   RESPONDENT NAME:

                   SUBJECT PRODUCT(S):

                   ASSET CLASS(ES):

                   ADDRESS:



                   TELEPHONE #:

                   FACSIMILE #:

                   E-MAIL ADDRESS:

                   CLIENT CONTACT:

                   SIGNED:

                   Name (print):

                   Title:

                   Date:




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    A.        COMPANY BACKGROUND AND GENERAL DESCRIPTION

         1. Executive Summary.

              Please submit an executive summary consisting of not more than 3 one-
              sided pages, which summarizes the contents of the Proposal with the firm’s
              name identified on the top of the first page.

         2. For which asset classes(es) are you submitting a response? Please check all
            that apply:
                a. Domestic Equity Large Cap       _______
                b. Domestic Equity Small Cap       _______
                c. International Equity            _______
                d. Emerging Markets Equity         _______
                e. Global Equity                   _______
                f. Core Fixed Income               _______
                g. Real Estate                     _______
                h. Private Equity                  _______

         3. Please complete a questionnaire for Callan Connects program. In order to
            complete the questionnaire please contact Lyman Jung via e-mail at
            jung@callan.com.

         4. Indicate your firm’s fiduciary classification:

                 _____Bank

                 _____Insurance Company

                 _____Registered Investment Advisor (Investment Advisors Act of 1940)

                 _____Affiliate of Fiduciary
                     (Name and Classification)

                 _____Other (Please explain)


         5. Please provide a brief history of the firm, primary business, capital position,
            and other descriptive information, including:

                 a. the month and year of SEC 1940 Act registration,
                 b. the month and year the firm began managing subject product
                    portfolios,
                 c. the month and year the firm began managing subject product
                    portfolios for U.S. tax-exempt clients

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        6. Describe the ownership of the firm, including but not limited to ownership
           structure, and affiliated companies or joint ventures. If an affiliate,
           designate percent of parent firm’s total revenue generated by your
           organization. If the firm is a joint venture partner, identify the percentage of
           ownership and revenues recognized by each partner to the combined
           association.

        7. Provide an organizational chart diagramming the relationships between the
           professional staff and the parent, subsidiary, affiliate, or joint venture
           entities.

        8. Describe U.S. Dollar amounts of coverage for SEC-required (17g-1) fidelity
           bonds, errors and omissions coverage and any other fiduciary coverage,
           which your firm carries. List the insurance carriers supplying the coverage.

        9. Over the past five years, has your organization or any of its affiliates or
           parent, or any officer or principal been involved in any business litigation,
           regulatory or legal proceedings? If so, provide a detailed explanation and
           indicate the current status of these proceedings. Also provide a complete
           Form ADV (Parts I and II).

        10. Describe in detail any potential conflicts of interest your firm may have in
            the management of this account. Include any activities of affiliated or
            parent organizations, brokerage activities, investment banking activities, or
            any past or current relationships with PRIM Board members, PRIM
            Committee members and/or PRIM investment staff. Include any other
            pertinent activities, actions, or relationships not specifically outlined in this
            question. Also disclose any business relationship with PRIM’s consultants,
            which include Callan, The Townsend Group, Hamilton Lane, Cliffwater, NEPC,
            and FX Transparency.

        11. Describe all outside marketing/sales services (including product design and
            development) for which your firm has contracted over the last three years
            for the marketing of your investment services to the institutional, tax-
            exempt market. Specify any such arrangements as they relate to the subject
            product being proposed. Indicate whether the fees paid for such services
            are charged to client portfolio assets.

        12. Describe any material developments in your organization (changes in
            ownership, personnel, business, etc.) over the past three years in detail.

        13. Do you have a plan in place for an alternative worksite should your facilities
            become inoperative because of fire, earthquake, flood, etc.? Describe.


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        14. Describe your firm’s experience in managing portfolios of emerging
            managers.

               a. What asset classes to you believe to be your core competency?
               b. Please describe your experience managing portfolios of emerging
                     managers benchmarked to the following:
                   i.  Large Cap Domestic Equity: S&P 500
                  ii.  Small Cap Domestic Equity: Russell 2500
                iii.   International Equity: MSCI World ex-US IMI
                 iv. Emerging Markets Equity: MSCI EM IMI
                  v.   Global Equity: MSCI World IMI
                 vi. Core Fixed Income: Barclays Capital Aggregate
                vii. Real Estate: NCREIF Property
               viii. Private Equity: Russell 3000 + 3%


               c. Do you currently manage portfolios of emerging managers
                     benchmarked to the following:
                   i.   Large Cap Domestic Equity: S&P 500
                  ii.   Small Cap Domestic Equity: Russell 2500
                 iii.   International Equity: MSCI World ex-US IMI
                 iv. Emerging Markets Equity: MSCI EM IMI
                  v.    Global Equity: MSCI World IMI
                 vi. Core Fixed Income: Barclays Capital Aggregate
                vii. Real Estate: NCREIF Property
               viii. Private Equity: Russell 3000 + 3%

        15. How does your firm define “emerging manager”? Please describe.

        16. Does your firm distinguish “micro” (managers focusing on micro-cap stocks)
            emerging managers from a broader universe of emerging managers?
               a. How would you define a “micro” emerging manager?
               b. Do you have experience building portfolios of “micro” emerging
                  managers?

        17. Describe how your firm is compensated.
               a. Are there fees paid by the underlying managers directly or indirectly
                   to your firm?
               b. If so what are they based on?



    B. ASSETS UNDER MANAGEMENT (AUM) – Answer separately for each asset class
       for which you are applying


                                                                                     20
[Type text]

        1. Please answer the following questions by completing the table below for
           information as of March 31, 2012:
               a. Total firm-wide AUM - include what percentage are institutional
                  assets.
               b. Total manager of emerging manager AUM - include what percentage
                  are institutional assets.
               c. Total number of accounts in manager of emerging manager programs
                  broken out by vehicle type (i.e. separate accounts, commingled,
                  mutual funds or other).
               d. Total (asset class) manager of emerging manager AUM – include what
                  percentage are institutional assets.
               e. Total assets (asset class) manager of emerging manager programs,
                  broken out by vehicle type (i.e. separate accounts, commingled,
                  mutual funds or other).
               f. Total number of accounts in (asset class) manager of emerging
                  manager programs broken out by vehicle type (i.e. separate
                  accounts, commingled, mutual funds or other).
               g. Total (asset class/PRIM-specific benchmark) manager of emerging
                  manager AUM – include what percentage are institutional assets.
               h. Total assets (asset class/PRIM-specific benchmark) manager of
                  emerging manager programs, broken out by vehicle type (i.e.
                  separate accounts, commingled, mutual funds or other).
               i. Total number of accounts in (asset class/PRIM-specific benchmark)
                  manager of emerging manager programs broken out by vehicle type
                  (i.e. separate accounts, commingled, mutual funds or other).


                3/31/2007     3/31/2008     3/31/2009     3/31/2010     3/31/2011       3/31/2012
        1.a
        1.b
        1.c
        1.d
        1.e
        1.f
        1.g
        1.h
        1.i

        2. List the 5 largest U.S tax-exempt accounts currently managed, including
           public and ERISA fund clients, that are invested in (asset class) manager of
           emerging manager portfolios:

        Client Name               Inception Date             Market Value (3/31/2012)




                                                                                     21
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        3. List all clients and asset amounts gained and lost in (asset class) manager of
           emerging manager programs over the past three years as of 3/31/2012.
           Please specific the benchmark used for each client portfolio.

        4. What are the minimum and maximum account sizes you will accept for a
           separate account in a manager of emerging manager program? What is the
           largest, average and smallest separate account size you currently manage in
           a domestic equity manager of emerging manager program?

        5. Do you offer a commingled fund structure? If yes:

               a. Please list the advantages and disadvantages of both structures as it
                  relates to the subject product.
               b. Describe whether there have been any issues with respect to market
                  timing in this or other commingled funds offered by your firm. Also
                  describe how market timing is prevented in the commingled fund.

        6. Describe the objectives of your firm with respect to future growth in the
           manager of emerging manager programs, commenting on:
              a. Additional resources for portfolio management, research, trading,
                  client service, technology, and tools to enhance the investment
                  process or manage growth.
              b. Size limitations with respect to assets under management in the
                  product. How did you arrive at those asset limits? Are companion
                  retail mutual fund assets and assets in this category from broader
                  mandates included in these limits?

        7. Describe the size of the (asset class) manager of emerging manager
           programs by answering the following questions:
              a. What is the optimum total asset size and number of client accounts
                  in this area? Why?
              b. At what total asset size in (asset class) manager of emerging manager
                  programs do you intend to cease accepting more business?
              c. What advantages and disadvantages does your current size present
                  to achieving superior performance results in the future?

        8. Provide the client name, address, phone number, contact name, title and
           account type (e.g. defined benefits, defined contribution, endowment) of
           three manager of emerging manager accounts that have terminated their
           relationship with you over the past three years. We may contact them for a
           reference.

        9. Provide the client name, address, phone number, contact name, title and
           account type (e.g. defined benefits, defined contribution, endowment) of


                                                                                      22
[Type text]

              three manager of emerging manager accounts that have invested with you
              over the past three years. Please detail the nature of their mandate.

C. PEOPLE/ORGANIZATION

    1. Describe the team that will manage the portfolio. Please include the following:
          a. Indicate each person's role on the team, length of time on the team, and
              overall experience.
          b. Provide biographies for key positions (including prior employment
              history).
          c. Highlight the person(s) who would serve as the lead portfolio manager(s)
              and their backup(s).
          d. Please distinguish between asset classes if applicable.

    2. Does your organization do any trading in-house? If so please describe the
       qualifications of the person responsible for overseeing that function.

    3. Describe your internal training procedures for portfolio managers and research
       analysts.

    4. Provide an organizational chart of your firm.

    5. Describe the compensation and incentive program for professionals directly
       involved in the subject product.

    6. Discuss any turnover of professionals directly involved in the subject product
       during the past five years.

Date of Hire           Name/Title                Responsibilities         Previous Role


Date of                                              Years at       Reason for   Replaced by
                 Name/Title   Responsibilities
Departure                                             Firm           Leaving     (name/title)




                                                                                           23
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D.      INVESTMENT PROCESS, IMPLEMENTATION AND EVALUATION PROCESS – all
        firms must respond.

     1. Process.

              a. How do you identify emerging firms?

              b. Do you have any minimum assets under management criteria that must
                 be met for consideration?

              c. How do you evaluate the organizations financial stability and
                 infrastructure?

              d. Do you conduct background checks on the key investment professionals?

              e. What factors do you consider in determining their potential as
                 investment talent?

              f. Do you have a checklist of items considered as you conduct your due
                 diligence? If so, please provide a copy.

              g. Please provide a sample of a manager due diligence package.

              h. Within you organization, who has the authority to hire or terminate a
                 manager? Are terminated managers removed from all portfolios? If not,
                 please explain the circumstances under which a manager might be
                 terminated in one account or vehicle and not in another.

              i.   What is your investment philosophy and how is it translated into
                   portfolio construction?

              j.   What in your process or philosophy do you believe differentiates your
                   firm from others in the marketplace? Are there any special/unique firm
                   resources that provide you with a competitive advantage?

              k. Please explain your firm’s research process. Do you visit managers on-
                 site? How do you evaluate managers?

              l.   What characteristics of a prospective manager do you find appealing,
                   and why?

              m. Do you keep an approved list of managers that are considered ready for
                 inclusion in client portfolios?

              n. Please provide detail of your database showing availability of managers

                                                                                       24
[Type text]

                 by style or strategy

              o. What is the typical time frame for funding a manager after your initial
                 steps in the research process?

              p. Do you negotiate capacity with managers?

              q. Describe how you negotiate the fees that are paid to the investment
                 managers utilized.


    2. Implementation.

              a. Describe the portfolio construction process for an emerging manager
                 mandate? Please specify number of managers and type of strategies
                 under considerations for the construction of such a mandate.

              b. Describe the software packages used to manage portfolios.

                      i. If owned, was it internally developed and by whom?
                     ii. Is it internally maintained?
                    iii. How long has the current system been in place?

              c. How many managers do you typically use to build out an investment
                 mandate?

              d. How many managers do you currently invest with across accounts and
                 strategies?

              e. To what extent do you assist the managers in your program (client
                 service, marketing, investment process, etc.)?

                      i. What infrastructure do you offer a prospective manager
                         (compliance, trading, etc.)?
                     ii. Does this vary by asset class?

              f. To what extent do clients engage in the portfolio construction process?


    3. Evaluation Process.

              a. Describe how the past performance of the underlying managers is
                 monitored and to what extent it is considered in your evaluation process
                 (both initially and ongoing).


                                                                                           25
       [Type text]

                     b. Please provide your monthly gross-of-fees composite performance for
                        the relevant products/managers used in the construction of this manager
                        of emerging manager mandate, since the inception of each product(s),
                        along with the corresponding benchmark return. This should be
                        provided in excel.

                     c. What is the expected tracking error and expected alpha of relevant
                        product(s) vs. the benchmark(s)?

                     d. What has been the actual tracking error of portfolio of emerging
                        managers vs. the benchmark(s) over the past five years? Please explain
                        any deviations from the expected tracking error.

                     e. How many managers have been graduated out of your portfolios into
                        clients’ general programs? Please describe that process and if you
                        initiate that recommendation.

                     f. How many managers have you terminated? Describe the reasons and
                        the process.

                     g. How is portfolio risk managed and monitored?

                             i. What is your firm's definition of risk with respect to the subject
                                product? If more than one, specify each.
                            ii. Describe how you monitor and manage risks such as: tracking
                                error, common factor analysis, security, sector, and industry
                                weightings, value at risk and scenario analysis.
                           iii. Describe any risk measurement models used and how this
                                analysis is incorporated into the portfolio construction and
                                management process.
                           iv. How do you monitor factors that are not related to investment
                                performance?      For example, financial strength, personnel
                                turnover, trading activity, and asset growth.
                            v. What level of transparency do you expect to have? Would PRIM
                                have full transparency to be incorporated into our risk
                                measurements system?

       E.    OPERATIONS & BACK-OFFICE – all firms must respond

               1.    Provide a list of the operations and back-office professionals who will
                     service the PRIM account if contracted with:

OPERATIONS & BACK-OFFICE OPERATIONS
 Name       Title &          Location           Years    of Years at Degrees/Desig        Sponsoring
            Responsibilities                    Experience Firm      nations              Body/School

                                                                                               26
[Type text]




    2. Provide biographies, no longer than one page, of each of the persons listed in
       Question E.1. Please include their prior employment history.

    3. Describe your internal training procedures for professionals on the back office
       operations team.

    4. What personnel or organizational improvements are planned over the next
       three to five years?

    5. Provide an organizational chart that diagrams the different operations functions
       dedicated to the product area.

    6. Describe the compensation and incentive program for operations professionals
       directly involved in the subject product.

    7. Discuss any turnover operations professionals directly involved in the subject
       product during the past five years.


    F. COMPLIANCE/INTERNAL CONTROL STRUCTURE – all firms must respond

    1. Provide a detailed summary of your firm’s compliance/internal control
       structure. Identify senior or key personnel in the firm’s compliance process.

    2. Does your firm maintain a code of ethics? If so, please attach.

    3. Is your firm compliant with the CFA Institute Asset Manager Code of
       Professional Conduct? If not, discuss your firm's reasons for choosing not to
       comply.
       http://www.cfainstitute.org/ethics/codes/assetmanager/Pages/index.aspx

    4. During the past five years, has the firm been subject to any governmental
       regulatory or law enforcement agency’s investigation, examination, or other
       proceeding directly involving the firm, its owners, or employees other than such
       examination or other proceedings as are routinely conducted in the ordinary
       course of the firm’s business?

    5. During the past five years, have any of the firms on your platform or on your
       approved list been subject to any governmental regulatory or law enforcement
       agency’s investigation, examination, or other proceeding directly involving the
       firm, its owners, or employees other than such examination or other
       proceedings as are routinely conducted in the ordinary course of the firm’s
       business?

                                                                                       27
[Type text]



    6. During the past five years, has the firm been subject to any litigation alleging
       fraud, breach of fiduciary duty, or other willful misconduct?

    7. During the past five years, have any of the firms on your platform or on your
       approved list been subject to any litigation alleging fraud, breach of fiduciary
       duty, or other willful misconduct?

    8. Does the firm conduct periodic risk assessment? Provide a copy of SAS 70 if
       available, or other internal control review documentation, preferably prepared
       by an independent third party.

    9. Provide copies of the firm’s most recent audited financial statements and
       auditor’s management letter.

    10. Has your firm ever violated a client guideline?       If so, please describe the
        violation and the resolution.

    11. Do you or your investment managers trade for client accounts through an
        affiliated broker/dealer?

    12. How are trading costs monitored and controlled for this product?

    13. What policies and procedures do you have in place to avoid or prevent conflicts
        of interest?

    14. Does anyone in your organization responsible for emerging manager selection
        have a financial interest in any of the managers that are recommended for
        investment?

    15. Are you comfortable with having a right-to-audit clause in the investment
        manager agreement?

    16. Describe any direct and indirect compensation received by employees from
        investment managers or other investment-related firms.


 G. CLIENT SERVICE – All firms must respond

      1. Which of your firm’s offices would service this account? What services would
         specifically be provided by which office?
            a. Where is the portfolio manager of the proposed (asset class) manager
                 of emerging manager account located?
            b. Where is your firm headquartered?


                                                                                          28
[Type text]

      2. Please specify the primary client service contact. How often could the person
         be available for client meetings? How often could the portfolio manager, chief
         investment officer and/or firm president be available for client meetings?

      3. Do you allow underlying managers to meet directly with clients?

      4. Are you willing to provide ongoing client education with regards to emerging
         managers, including but not limited to:
            a. Allowing clients to shadow due-diligence visits?
            b. Access to portfolio managers?
            c. Legal/regulatory education?




                                                                                     29
[Type text]



H. PERFORMANCE
    1. YOU MUST COMPLETE THE TABLES IN THE COMPANION WORKBOOK (TABS A
       – E) OR YOUR SUBMISSION MAY NOT BE PROCESSED. PLEASE DO NOT
       CHANGE THE WORKBOOK FORMAT. Where performance information is
       requested, please provide performance on a total return basis GROSS OF ALL
       FEES AND MANAGEMENT COSTS since inception of the program(s). Indicate if
       returns are net or gross of custody costs. Use Global Investment Performance
       Standards (GIPS) or, if different, indicate explicitly how they differ. Indicate
       whether the performance represented is a composite performance or that of a
       separate account(s). Tabs A – E must illustrate the same, single portfolio or
       composite. Your firm may illustrate up to three representative portfolios for
       each asset class (Tabs A – E must be duplicated in their entirety for each
       representative portfolio).

                 Tab A: Market capitalization distribution of the underlying managers
                  in the representative program.
                 Tab B: Monthly Performance of the Representative Portfolio since
                  Inception.
                 Tab C: Calendar Year and Annualized Performance of the
                  Representative Portfolio, Since Inception.
                 Tab D: Calendar Year and Annualized Information Ratios of
                  Representative Portfolio, Since Inception.
                 Tab E: Calendar Year and Annualized Standard Deviation of
                  Representative Portfolio, Since Inception.




                                                                                    30
[Type text]

X.      FEES.


     1. Please provide a proposed fee schedule for the mandate, including any
        breakpoints. Please assume a portfolio size of $100 million.

     2. Will you certify that the fee schedule provided above is the most favorable fee
        schedule that the firm offers for accounts of similar size? If not, please explain
        why.

     3. Will you disclose the fees paid to the underlying managers within the mandate?
        Do you provide complete transparency in regards to fees paid to the investment
        managers utilized?




                                                                                       31
[Type text]

XI.     REPRESENTATIONS AND WARRANTIES.

        All respondents are required to submit an executed copy of the following
        Representations and Warranties as an attachment to the cover letter described
        in Section IV of this RFP:

        A. The bidder warrants that, if engaged by PRIM, it will not delegate its
        responsibilities assumed under the Agreement.

        B. The bidder warrants that it has completed, obtained, and performed all
        registrations, filings, approvals, authorizations, consents or examinations
        required by a government or governmental authority to undertake the services
        described in Section III.


        ____________________________________                        ______________
        Name of Firm                                                  Date


        ____________________________________                       _______________
        Signature                                                     Title




                                                                                   32
[Type text]

XII.    EXHIBITS.




                    33
[Type text]




                                       EXHIBIT A

              PRIM’s Strategic Asset Allocation & Current Investment Managers




                                                                                34
[Type text]




1. PRIM’s Strategic Asset Allocation

                      Asset Class         Long Term Target Allocation
                     Global Equity                   43%
                   Core Fixed Income                 13%
               Value-Added Fixed Income              10%
                     Private Equity                  10%
                      Real Estate                    10%
               Timber/Natural Resources              4%
                     Hedge Funds                     10%




                                                                        35
[Type text]

2. Current Investment Managers

                                             GLOBAL EQUITY
US DOMESTIC EQUITY                    INTERNATIONAL EQUITY                     EMERGING MARKETS EQUITY
INTECH                                Ballie Gifford                           AshmoreEMM
PIMCO                                 Marathon Asset Management                GMO
SSGA Russell 2500 - Passive           Mondrian Investment                      T. Rowe Price
SSGA S&P 500 - Passive                SSGA MSCI World ex-US IMI –              SSGA MSCI EM IMI - Passive
                                      Passive

                                             FIXED INCOME
        CORE FIXED INCOME                                     VALUE ADDED FIXED INCOME
                   Inflation-                                 Emerging                          Distressed
Core                                   High Yield                            Bank Loans
                   Linked                                     Markets Debt                      Debt
BlackRock -        BlackRock TIPS                                                               Oaktree
                                       Fidelity               Ashmore             ING
Passive            (Passive)                                                                    Capital
                   BlackRock                                                                    Angelo,
Loomis             Inflation Linked    Loomis                 PIMCO               Eaton Vance   Gordon &
                   Bonds                                                                        Co. LP
                                                                                                Trust
PIMCO                                  Shenkman               Investec                          Company of
                                                                                                the West
                                                                                                Wayzata
Access Capital -
                                                              Pictet                            Investment
ETI
                                                                                                Partners
Community
Capital                                                                                         Avenue
                                                              Stone Harbor
Management -                                                                                    Capital
ETI
AFL-CIO HIT - ETI                                                                               Centerbridge
                                                                                                Summit
                                                                                                Partners

REAL ESTATE & REITS                TIMBER/NATURAL RESOURCES (NR)
AEW                           Timber              Public NR              Private NR
                              Forest                                     Quantum
JP Morgan Investment                              Jennison
                              Investment                                 Energy
Management                                        Associates
                              Associates                                 Partners
                              The Campbell                               Tenaska Capital
TA Associates                                     T.Rowe Price
                              Group                                      Management
                                                                         Denham
INVESCO Real Estate
                                                                         Capital
LaSalle Investment
Management
INVESCO (REIT)
RREEF (REIT)
Urdang (REIT)
European Investors (REIT)
New Boston Fund - ETI
Canyon Johnson Urban
Funds - ETI
Intercontinental Real
Estate - ETI
                                                                                                            36
[Type text]

HEDGE FUNDS
Arden                        Claren Road
                             Davidson
K2
                             Kempner
Grosvenor                    Elliott
PAAMCO                       Glenview
The Rock Creek Group         Highfields
Anchorage                    Indus
Arrowgrass                   King Street
Ascend                       Och-Ziff
                             Pershing
BlueCrest
                             Square
Brevan Howard                Samlyn
Brigade                      Taconic
Capula                       Winton
                             York

                                            PRIVATE EQUITY
Advent                 Clayton, Dubilier                         Nash, Sell &
                                            GTCR                                     Summit Ventures
International          & Rice                                    Partners
                       Code Hennessey                                                TA
Alchemy Partners                            H.I.G. Capital       Nautic Partners
                       & Simmons                                                     Associates/Advent
                                                                                     Technology
Alta                   Commonwealth         Hancock Venture      New Enterprise
                                                                                     Crossover
Communications         Bioventures          Partners             Associates
                                                                                     Ventures
American                                    Harborvest                               Tenaska Capital
                       Cornerstone                               Nordic Capital
Securities                                  Partners                                 Management
                                            Hellman &            Oaktree Capital     Texas Pacific
Angelo Gordon          Crossroads Capital
                                            Friedman             Management          Group
                                                                 Odyssey
APAX Partners &                                                                      The Cypress
                       CVC Capital          Highland Capital     Investment
Co.                                                                                  Group
                                                                 Partners
Apollo                 Davis, Tuttle
                                            Index Ventures       Olympus             The Vista Troup
Management Co.         Venture Partners
                       Denham Capital       Insight Venture      One Liberty
Austin Ventures                                                                      Thoma Bravo
                       Management           Partners             Ventures
                       Dominion             Institutional                            Thoma Cressey
Avenue Capital                                                   Onex Partners
                       Ventures             Venture Partners                         Equity Partners
                       DLJ Merchant         InterWest                                Thomas H. Lee
Bain Capital                                                     PAI Europe
                       Banking              Partners                                 Company
                       El Dorado                                 Permira Advisers    Tourquest
Battery Ventures                            J.H. Whitney
                       Ventures                                  Limited             Partners
Berkshire Partners,    Equitable Capital    Joseph, Littlejohn                       Towerbrook
                                                                 Polaris
LLC                    Management           & Levy                                   Capital
Beta Management                                                  Providence Equity   Trident Capital
                       Essex Woodlands      Kelso & Company
Partners                                                         Partners            Management
The Blackstone         Ethos Private        Keytone Capital      Quad - C            Trust Company of
Group                  Equity               Partners             Management, Inc.    the West


                                                                                                        37
[Type text]

                   Exponent            Kohlberg Kravis    Quantum Energy       Union Square
Boston Ventures
                   Partners            Roberts & Co.      Partners             Ventures
                                       KPS Capital        Rembrandt            VantagePoint
Bridgepoint        FH & Co.
                                       Partners           Venture Partners     Venture Partners
                   Fidelity
Brown Brothers                         Landmark                                Vestar Equity
                   Management                             Richland Ventures
Harriman & Co.                         Partners                                Partners
                   Trust Company
                   First Reserve       M/C Venture                             Vista Equity
Candover                                                  SAIF Partners
                   Corporation         Partners                                Partners
                                       Madison            Schroder             Wayzata
Capital Resource   Flagship Ventures
                                       Dearborn Capital   Ventures Life        Investment
Partners           (ETI)
                                       Partners           Sciences             Partners
                                       Massachusetts
                   Forstmann Little                       SCP Private Equity
Carlyle Group                          Technology                              Weintraub
                   & Co.                                  Management
                                       Development
                                                                               Welsh, Carson,
Castile Ventures
                   Frontenac           Menlo Ventures     Sentry Financial     Anderson &
(ETI)
                                                                               Stowe
Centerbridge
                   FX Equity           MFA                Sherbrook Capital    Weston Presidio
Associates
                                                          Smith
                   Genstar Capital     Montagu Private                         WestView Capital
Charles River                                             Management
                   Partners            Equity                                  Management
                                                          Company
                                                          Southern
Charlesbank        Gilde Buyout        Montreux Equity                         William Blair &
                                                          California
Capital Partners   Partners            Partners                                Co.
                                                          Ventures
Charterhouse       Golder, Thoma,                                              Willis Stein &
                                       Morgan Holland     Spark Capital
Group              Cressey                                                     Partners
                   Gores Technology    Narragansett       Spectrum Equity      Xenon Private
Chequers Capital
                   Group               Capital            Partners             Equity




                                                                                                  38
[Type text]




                            EXHIBIT B

              Sample Investment Management Agreement




                                                       39
[Type text]

                      INVESTMENT MANAGEMENT AGREEMENT

THIS AGREEMENT, dated as of [date], is made by and between the Pension Reserves
Investment Management Board ("PRIM"), as trustee of the Pension Reserves
Investment Trust (“PRIT”), and [manager] (the "Manager").

        Introduction. Under Massachusetts General Laws, Chapter 32, Section 23, PRIM
has general supervision of the investment and reinvestment of the PRIT Fund created
by Chapter 32, Section 22 of such laws. PRIT has been established for the purpose of
depositing, investing and disbursing amounts set aside to meet further liabilities of
various public retirement systems in Massachusetts. PRIM is responsible for the
administration of PRIT and enters into this Agreement appointing the Manager as
investment manager of certain assets of PRIT pursuant to its authority under
Massachusetts General Laws, Chapter 32, Section 23, subdivision (2A), paragraph (e),
clause (iii).

        1.     Appointment of the Manager as Investment Manager. PRIM hereby
appoints and retains the Manager, and the Manager agrees to serve as investment
manager, upon and subject to the terms hereof, beginning at the opening of business
on [date] (the “Effective Date”) and continuing until this Agreement is terminated in
accordance with the terms hereof. The Manager hereby accepts appointment as such
investment manager and agrees to provide services in accordance with (a) this
Agreement, and (b) the investment objectives and investment guidelines set forth in
Schedule A hereto (the “Investment Objectives and Guidelines”). The Investment
Objectives and Guidelines may be modified from time to time by PRIM, upon at least
thirty (30) days’ prior written notice to the Manager. Subject to such policies, the
Manager shall use its best efforts to increase the value of the Account by causing the
assets in the Account to be invested and reinvested from time to time.

        2.     The Account. The responsibilities and duties of the Manager are limited
to the assets of the account designated by PRIM (the "Account"), which assets will be
only a portion of the assets of PRIT. From time to time, PRIM may transfer other assets
of PRIT to the Account or withdraw any assets from the Account upon written notice to
the Manager. Nothing in this Agreement will constitute a commitment by PRIM to
maintain any minimum amount of assets in the Account. The Manager also shall
furnish to PRIM necessary assistance in the preparation of all reports relating to the
Account now or hereafter required by applicable law.

       3.      Investment Objectives and Guidelines. The Manager will have full
responsibility to invest and reinvest the Account, principally in marketable small cap
domestic equity securities in accordance with the Investment Objectives and
Guidelines, and in compliance with the Operating Trust of PRIM and all applicable laws
and regulations.

        4.     Discretionary Authority. The Manager shall have only those powers set
forth in the Operating Trust of the Pension Reserves Investment Management Board, as
                                                                                     40
[Type text]

amended, which powers are explicitly granted to the Manager by PRIM in this
Agreement and, with respect to the assets of the Account, all powers which are not so
granted shall be exercised only by PRIM. Pursuant to Section 9.2(h) of the Operating
Trust, PRIM authorizes the Manager to invest the Account in accordance with the
Investment Objectives and Investment Guidelines set forth in Schedule A. PRIM
reserves the right to control and invest all cash balances that may exist in the Account,
and the Custodian (as defined in Section 6) will inform PRIM as to the need for or
availability of cash as a result of securities transactions. In carrying out its
responsibilities as investment manager, and subject to this Section 4, and the
Investment Objectives and Guidelines, the Manager will have full and complete
discretion to direct and manage the investment and reinvestment of assets in the
Account with full and exclusive power and authority (a) to buy, sell, exchange, convert
and otherwise trade in any securities as the Manager may select and (b) to establish
and maintain and deal through accounts with one or more securities brokerage firms as
the Manager may select. In making all such selections, the Manager will, bearing in
mind the best interests of the Account, use its best efforts to obtain for the Account the
most favorable net price and execution available. PRIM reserves the right to specify
that any part of the securities transactions for the Account be directed by the Manager
to securities brokerage firms that meet requirements or participate in programs or
initiatives specified by PRIM. Consistent with Massachusetts General Laws, Chapter 32,
Section 23, subdivision (2A)(h), in selecting brokerage firms, the Manager will use its
best efforts to benefit and expand the economic climate of the Commonwealth of
Massachusetts, including by utilizing brokerage firms within the Commonwealth, so
long as this is consistent with its duties and obligations hereunder.

        5.    Confidentiality. The Manager will maintain in strictest confidence the
investment advice and information it furnishes to or receives from PRIM or the
Custodian (as defined in Section 6) in connection with this Agreement; provided,
however, that the Manager will be permitted to disclose or communicate to a proper
party any information received from PRIM or the Custodian or developed by the
Manager under the terms of this Agreement, if such disclosure or communication is
necessary to carry out the purposes of this Agreement or is required by law. Before
such disclosure or communication, the Manager, unless prohibited by law, will notify
PRIM of the information to be disclosed or communicated and the party to whom that
information will be disclosed or communicated. The terms of this paragraph shall not
be interpreted so as to prevent the Manager from providing investment advice to other
clients who share comparable investment objectives with PRIM, or to prohibit the
Manager from utilizing the Manager’s investment experience or performance with
respect to the Account on an undisclosed basis for use in composite performance
presentations. The Manager hereby approves of periodic reports by PRIM and its staff
of the Manager’s investment program and investment results hereunder, recognizing
that such reports may be public records available to the media and the public.

     6.      Custody of Account Assets. PRIM has entered into an Agreement with
BNY Mellon to act as custodian for all assets of PRIT being managed by investment

                                                                                       41
[Type text]

managers, including without limitation any cash which may be in the Account from time
to time, and no assets of the Account may be delivered or paid to the Manager. The
entity serving as such custodian from time to time is herein referred to as the
“Custodian”. The Manager will furnish to the Custodian, with a copy to PRIM, a list of
the Manager’s personnel who are authorized to give instructions to the Custodian with
respect to the Account, and will forthwith upon any change in such personnel furnish
an amended list to the Custodian, with a copy to PRIM. The Custodian will maintain
separate records for the Account, and the Manager agrees to furnish to the Custodian
all information reasonably necessary to maintain such records. The Manager shall have
no responsibility or liability with respect to the acts, omissions or other conduct of the
Custodian. PRIM reserves the right to change the Custodian upon thirty (30) days’
notice to the Manager.

        7.      Statement of Account; Valuation; Reports. The Manager shall keep full
and complete records of all transactions with respect to the Account and will, at the
end of each month during the term of this Agreement, render a statement thereof to
PRIM together with a portfolio analysis of the Account and performance comparisons
related thereto, and a listing of applicable transaction costs including brokers used and
commissions paid, if any, to brokers and the average cents per unit for trades. The
Manager shall also furnish to PRIM such additional reports with respect to the Account
as PRIM shall reasonably request from time to time, including the information set forth
in Schedule C hereto (“Investment Manager Compliance” reports). On a monthly basis,
no later than the seventh business day, the Manager shall also deliver to the Custodian
a report of all transactions in the Account during the prior month and a listing of each
investment in the portfolio and its net asset value at the end of said month. The
Manager shall also from time to time, but no less than semi-annually, attend meetings
(which, in PRIM’s sole discretion, may be by telephone conference) with PRIM to
discuss the Account and the investment outlook.

        PRIM shall cause the Custodian to provide the Manager with an appraisal of the
assets in the Account as of the last business or trading day of each month, together
with a transaction statement for the month listing all transactions occurring during the
month as well as opening and closing cash balances. This statement will be rendered
on a trade date basis and include any accrued income calculations. The Manager shall
be responsible for reconciliation of the Account with the Custodian on a monthly basis,
and shall promptly notify PRIM of all unresolved material differences.

        The Manager shall promptly notify PRIM in writing (1) of any change in the
Manager’s representations in this Agreement during the term of this Agreement; (2) of
any change in the senior management and key investment professionals, or material
changes in ownership of the Manager’s organization; (3) of any change in the senior
portfolio management team of the Account; (4) of any change in approach to the
management of the Account; (5) of any other material change in the Manager’s
business activities or circumstances, including changes affecting the Manager’s equity
capital; (6) of any action taken by the Manager that is contrary to or inconsistent with

                                                                                       42
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this Agreement, including the Investment Objectives and Investment Guidelines set
forth in Schedule A; and (7) of the commencement by any governmental regulatory or
law enforcement agency of any investigation, examination or other proceeding directly
involving the Manager, its owners, or employees, except such investigations,
examinations or other proceedings as are routinely conducted in the ordinary course of
the Manager’s business.

        8.     Fees and Expenses. The Manager will be entitled to receive from PRIM
as complete compensation for services rendered hereunder the fees set forth in
Schedule B hereto. The Fee Schedule may be modified by mutual agreement of the
parties in writing. Such fees will be paid by PRIM at the times and in the manner
specified in the Fee Schedule, and will be pro-rated from the Effective Date. The
Manager will not be paid or reimbursed for any expenses except to the extent
permitted by PRIM in writing. In the event that the Manager currently or at any time
during the continuation of this Agreement performs similar services for other clients
with a similar dollar level of assets at a lower or more favorable fee schedule, the
Manager will promptly notify PRIM of such arrangement.

        9.     Services Not Exclusive. The services of the Manager and its personnel to
be provided under this Agreement are not exclusive, and the Manager may provide
services to others and engage in other activities, but the Manager will allocate such
personnel and devote such efforts as are necessary for it to carry out its duties under
this Agreement. The Manager may give advice and take action in the performance of
its duties with respect to any of its clients which may differ from the advice given, or
the timing or nature of action taken, with respect to the Account, so long as the
Manager adheres to a policy of allocating investment opportunities to the Account over
a period of time on a fair and equitable basis relative to other clients. Nothing in this
Agreement shall impose upon the Manager any obligation to purchase or sell for the
Account any security or other property which the Manager purchases or sells for its
own account or the account of any other client if, in the opinion of the Manager, such
transaction or investment appears unsuitable, impracticable or undesirable for the
Account.

       10.     Procedures. All transactions will be consummated by payment to, or
delivery by, PRIM or such other party as PRIM shall have designated in writing as the
Custodian. Instructions of the Manager to PRIM and/or the Custodian will be made in
writing (or by such electronic means as the Manager and PRIM and/or the Custodian
may establish and maintain from time to time). The Manager will instruct all brokers or
dealers executing orders on behalf of the Account to forward to PRIM and/or the
Custodian copies of all brokerage confirmations promptly after execution of
transactions. The Manager shall have full and complete discretion to establish accounts
with one or more securities brokers as the Manager may select. The Manager shall not
be responsible for any acts or omissions by any such broker or brokers, or third parties.
The Manager is hereby authorized to combine orders on behalf of the Account with
orders on behalf of other clients of the Manager. As set forth in Section 4, the Manager

                                                                                      43
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will use its best efforts to obtain the most favorable net price and execution available
on securities traded for the Account.

        11.     Persons Authorized to Act for the Manager. The Manager will from time
to time certify to PRIM the name of the person or persons authorized to act on its
behalf and will give PRIM a specimen of his or their signatures. Any person so certified
will be an authorized representative of the Manager for purposes of this Agreement
and his authority to act on behalf of the Manager will continue until notice to the
contrary is given by the Manager and received by PRIM.

        12.    Persons Authorized to Act for PRIM. PRIM may from time to time
designate any person or persons to act on its behalf in giving instructions, directions,
notices or other communications to the Manager and will certify the name of such
person or persons to the Manager and give the Manager a specimen of his or their
signatures. The authority of any such person to act on behalf of PRIM will continue
until notice to the contrary is given by PRIM and received by the Manager. All oral
instructions shall be promptly confirmed in writing.

         13.     Proxies. PRIM will vote all proxies for securities held in the Account. The
Manager shall, in conjunction with PRIM and the Custodian, develop procedures to
facilitate the timely exercise by PRIM of these rights.

       14.     Representations by the Manager. The Manager represents and
warrants that it is registered and in good standing as an investment adviser pursuant to
the Investment Advisers Act of 1940, as amended, and that it has completed, obtained
or performed all other registrations, filings, approvals, authorizations, consents or
examinations required by any government or governmental authority for the
performance of the acts contemplated by this Agreement. The Manager will deliver
documentation of such compliance annually or as PRIM may reasonably request. PRIM
acknowledges receipt of Parts I and II of the Manager’s Form ADV, and the Manager's
Disclosure Statement, as required by Rule 204-3 under the Investment Advisers Act of
1940, not less than 48 hours prior to the date of execution of this Agreement.

        15.     Termination. This Agreement may be terminated at any time by PRIM
upon written notice to the Manager of such termination, and by the Manager upon
thirty days’ written notice to PRIM, effective as of the date set forth in such notice. Any
termination of this Agreement shall be without payment of any penalty by PRIM.

        A pro rata determination of fees, if appropriate, will be made for any quarter in
which this Agreement has been terminated. Any performance fee owed but still due at
time of termination will be paid over the remaining time and in accordance with the
established payout schedule as provided for in Schedule B.

        PRIM may also at any time without prior notice direct the Manager to cease
activity with respect to the Account, provided, however, that all trades executed but

                                                                                         44
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not settled prior to such direction shall be settled. Upon termination the Manager shall
cooperate with PRIM to transfer the securities and other assets in the Account and on
the effective date of the termination of this Agreement or as close to such date as is
reasonably possible, the Manager shall provide PRIM with a final report containing the
same information as provided in the monthly reports provided pursuant to Section 7.

        16.   Fiduciary Status of the Manager; Chapter 268A. With respect to the
performance of its duties and responsibilities hereunder for the Account, the Manager
acknowledges that it is a "fiduciary" within the meaning of Chapter 32 of the
Massachusetts General Laws. The Manager will discharge its duties and responsibilities
under this Agreement in accordance with the fiduciary standards of conduct and other
requirements as they apply to the Manager. The Manager is advised of the existence of
Massachusetts General Laws, Chapter 268A (the Massachusetts "Conflict of Interest"
statute), and is expected to act and perform its duties in accordance with such
provisions. The Manager acknowledges that PRIM has delivered a copy of Chapters 32
and 268A of the Massachusetts General Laws as currently in effect to the Manager.

        17.      Liability. The Manager shall not be liable for the selection of the
Investment Objectives and Guidelines but shall be responsible for the management of
the Account in accordance therewith and with such other instructions as PRIM may
provide from time to time. In addition to those requirements set forth in Section 16, at
all times the Manager shall exercise the care, skill, prudence, and diligence under the
circumstances then prevailing that a prudent expert acting in a like capacity and familiar
with such matters would use in the conduct of an enterprise of like character and with
like aims. The Manager shall have no responsibility whatsoever for the management of
any other assets of PRIT and the Manager shall have no duty, responsibility, or liability
in connection with the operation or the administration of PRIT. The Manager shall not
be subject to liability for any act, omission or mistake of judgment in the course of, or
connected with, the performance of its responsibilities hereunder, except for its own
negligence, willful misconduct or lack of good faith. Nothing herein shall be construed
to waive any liability that the Manager has under applicable federal or state securities
laws, or ERISA. No obligation of the Manager, under this Agreement or otherwise, shall
be binding personally upon any of the shareholders, officers, agents, employees or
trustees of any trust which the Manager may have established.

        18.    Authority. Each of the parties to this Agreement represents that it is
duly authorized and empowered to execute, deliver and perform this Agreement, that
such action does not materially conflict with or violate any provision of law, rule or
regulation, contract, deed of trust, or other instrument to which it is a party or to which
any of its property is subject, and that this Agreement is a valid and binding obligation,
enforceable against such party in accordance with its terms.

      19.   Bonding. The Manager agrees to maintain during the term of this
Agreement any fidelity bond with respect to the assets of the Account which it would


                                                                                        45
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have to maintain to satisfy Section 412 of ERISA and the regulations thereunder if PRIM
or PRIT were subject to the terms of ERISA.

       20. “Soft Dollar” and Other Arrangements. On an ongoing basis not less than
annually, the Manager will identify and provide a written description to PRIM of all
“soft dollar” arrangements that it maintains with respect to the Account or with brokers
or dealers which execute transactions for the Account. Prior to the commencement of
the active management of the Account, and periodically thereafter, but no less often
than annually, the Manager shall provide PRIM with a written description of all
arrangements with third parties and other individuals, entities, brokers or money
management firms who have or may receive or share in the payment of fees for
services in connection with securing or continuing this Agreement.

       21. Confirmations. The Manager will arrange to have brokers who effect
transactions for the Account send to the Custodian confirmations of purchases and
sales. Upon written request of PRIM, the Manager will arrange to have copies of any of
the foregoing sent to any other persons designated by PRIM.

      22.    Communication. Any approvals, instructions, directions, notices or other
communications (other than oral instructions described in Section 12) pursuant to this
Agreement will be mailed or delivered:

              a)      To PRIM at:

                      Pension Reserves Investment Management Board
                      84 State Street, Suite 250
                      Boston, Massachusetts 02110
                      Attention: Michael G. Trotsky, CFA, Executive Director


              b)      To the Manager at:

                      [manager]

              c)      to the Custodian at:

                      BNY Mellon
                      135 Santilli Highway
                      AIM 026-0313
                      Everett, MA 02149

       Either party may change the address for notices or other communications to it
by written notice to the other stating the new address. PRIM may change the name
and address for notices or other communications to the Custodian by written notice to


                                                                                     46
[Type text]

the Manager. Notices from either party to the other will be effective when received by
the addressee.

        23.    Assignment, etc. The Manager will not assign this Agreement without
the prior written consent of PRIM. This Agreement constitutes the entire Agreement of
the parties with respect to its subject matter and may only be amended by a written
amendment signed by both parties.

        24.   Headings; Attachments. Headings are for convenience only, and the text
of this Agreement will govern the rights and obligations of the parties. Each of the
Attachments hereto is incorporated herein by reference. Capitalized items used herein
have the same meanings as in this Agreement.

         25.    Disputed Matters. With respect to any controversy or dispute arising out
of this Agreement, interpretation of any of the provisions hereof, or the actions of the
Manager or PRIM hereunder, each of the parties consents to the non-exclusive
jurisdiction of all of the federal and state courts in the Commonwealth of
Massachusetts, agrees that venue with respect to any action in such Commonwealth
shall lie exclusively in Suffolk County, Massachusetts, and waives any defense of forum
non conveniens; provided, however, that at the sole election of PRIM, any such
controversy or dispute shall be submitted to arbitration before the American
Arbitration Association under the Commercial Arbitration Rules then obtaining of said
Association, such arbitration to be held in Boston, Massachusetts, and judgment upon
any award thus obtained may be entered in any court having jurisdiction thereof. In
any such arbitration each party to the arbitration shall bear its own expenses, including
expenses of attorneys, financial experts and other witnesses; any arbitration fees and
expenses of the arbitrators shall be divided equally between the disputing parties.
Service of process on either party shall be deemed effective if made in the manner
prescribed for the giving of notice in Section 22.

       26.     Massachusetts Law.      This Agreement will be considered to be an
instrument made under seal in the Commonwealth of Massachusetts and it will be
construed and the rights and obligations of the parties determined in accordance with
the laws of said Commonwealth, without giving effect to conflicts of laws principles.

        IN WITNESS WHEREOF, the Manager and PRIM have executed this Agreement
as of the date first above written.

                                            PENSION RESERVES INVESTMENT
                                                   MANAGEMENT BOARD
                                            BY:_____________________________
                                              Michael G. Trotsky, CFA, Executive
                                              Director

                                            [manager]

                                                                                      47
[Type text]

              BY:______________________________
              NAME: ___________________________

              TITLE:___________________________




                                                  48
[Type text]

[Manager]

Schedule A: Proposed Investment Objectives and Guidelines
(Active US Small Cap Equity Manager of Emerging Manager)

(Specific guidelines will be customized with managers)


I.      Investment Objectives

        The Manager’s performance benchmark is the Russell 2500 Index.

[To be customized to strategy]


II.     Investment Guidelines

        A.    Authorized Investments

[To be customized to strategy]

        B.    Specific Investment Guidelines


[To be customized to strategy]

        C.    Portfolio Characteristics


[To be customized to strategy]




                                                                         49
[Type text]

[Manager]

Schedule C: Manager Compliance Report

Compliance Certification



        In addition to the requirements of Paragraph 7 of the Investment Management
Agreement, as soon as practicable at the close of each calendar quarter, the Manager
shall certify to PRIM that:

1. the Manager has not deviated from the Investment Guidelines set forth in the
   Investment Objectives and Guidelines (Schedule A to the Investment Management
   Agreement);

2. the Manager has not deviated from the requirements of Massachusetts General
   Laws, chapter 32, section 23, concerning certain investments relating to South
   Africa and Northern Ireland, Iran, tobacco and Sudan.

If the Manager is unable to provide either of the certifications outlined above, the
Manager shall provide PRIM with a detailed written explanation.




                                                                                  50
[Type text]



[Manager]


Schedule D: Monthly Reconciliation Procedure


The Manager shall strike a monthly reconciliation with PRIM’s Custodian. This Schedule
describes the reconciliation procedure that Manager will follow with respect to PRIM’s
Account.

The attachments are as follows:

A. Monthly Reconciliation Schedule. This schedule (Attachment 1) details the
   timetable that must be followed each month.

B. Reconciliation Form. This is the form (Attachment 2) for reconciling with Custodian.
   The form must be filled out completely, with supporting data as necessary. The
   form comprises a number of reconciliation “elements” (shares, CUSIP number,
   income, etc.).

Reconciliations are completed when the Manager has accomplished the following steps:

              1. reconciled both the CUSIP and share number for each security position
                 with those shown on the Custodian’s records;
              2. compared Custodian’s prices on each security to Manager’s prices and
                 challenged Custodian’s prices on securities (if any) that exceed the
                 Manager’s internal pricing tolerances;
              3. reconciled portfolio income for the period with that shown on
                 Custodian’s records;
              4. noted methodology differences on the reconciliation form;
              5. resolved all differences with Custodian within a tolerance of less than or
                 equal to twenty five basis points (0.25%); and
              6. updated the Manager’s records to reflect all corrections necessary.

C. Methodology Schedule. This lists various methods by which Custodian arrives at the
   final net asset value of a portfolio. If methodology differences consistently result in
   portfolio market values outside the monthly ten basis point tolerance, it may be
   necessary to refer to this schedule to determine the source of the problem. In all
   cases of conflicting methodologies, Custodian’s methodology will govern.

D. Monthly Performance Report. Once the accounting reconciliation has been
   completed, Attachment 4, the format for a performance comparison, must be
   completed and faxed to the Custodian contact shown on this Attachment.
   Custodian Analytics will compare the Manager’s return to their returns and, in the

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    event the difference between the Manager’s return and the Custodian return is
    excessive, Custodian will contact the Manager to resolve such discrepancies.

In order to adhere to the timetable set forth in Attachment 1, the Manager will need to
have the Custodian’s online system installed in the Manager’s operations area so that
reconciliation can be performed electronically. The Manager will be required to use the
custodian’s online application to download the custodian’s information into the Excel-
based reconciliation form (Attachment 2). The Manager will then add their own data,
calculate differences, complete the reconciliation and explain significant variances or
methodology differences at the security level and, if applicable, in the aggregate as
described above, and in accordance with the timeframes outlined in Attachment 1. If
the Manager does not already have the Custodian’s online system in its operations
group, the Manager should contact the Custodian’s investment manager services area.

In addition to the Manager’s contacts at the Investment Manager Services area of
Custodian, all the Manager’s operations personnel involved with the reconciliation
process should be given the name of PRIM’s client service officer at Custodian (PRIM
will supply the name, telephone number and email address of this individual to the
Manager). The supervisor of the Manager’s operations area should call or email this
individual immediately with the names of the Manager’s operations personnel who
work on the PRIM reconciliation, a description of their roles, and their telephone
numbers.

Payment of the Manager’s fee is shall be contingent upon the Manager reconciling with
the Custodian as provided above.




                                                                                    52
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ATTACHMENT 1

PRIM
PUBLIC MARKETS INVESTMENT MANAGER
MONTHLY RECONCILIATION SCHEDULE


First business day:   PRIM sends expense accrual information to Custodian for input.

Second business day: Custodian sends preliminary net asset value data to public
                     markets managers via online system or other electronic means
                     (Available the morning of third business day).

Third business day: Public markets managers perform preliminary reconciliation of
               net asset value using summary data on online system.

Fifth Business day: Public markets managers complete and return to Custodian
                    preliminary reconciliations of net asset value as per Attachment
                    2.

Seventh business day: Public markets managers and Custodian resolve any
                  discrepancies, as per Attachment 2. Public markets managers
                  complete and return to Custodian Attachment 5, Monthly
                  Performance Report.

Tenth business day: Custodian notifies managers that all accounts are final and all info
                    is available online on Workbench for them to pull as needed.

 Eleventh business day: Public markets managers and Custodian complete final
                    performance reconciliation. Public markets managers advise
                    PRIM by fax that both the final account reconciliation and the
                    performance report are complete.

Twelfth business day: Custodian Analytics issues final performance reports.




                                                                                       53
                    [Type text]




                                             The PRIT Month-End Pre-Reconciliation
                                                        Spreadsheet
      ACCOUNT NAME:                                0
      ACCOUNT NUMBER:                              0
      FOR MONTH ENDING:                      January 0, 1900



                    CATEGORY                    MELLON                 MANAGER           DIFFERENCE

A.) HOLDINGS - COST                                            -                 -                    -   0
B.) HOLDINGS - MARKET                                          -                 -                    -   0
C.) PENDING TRADES                                             -                 -                    -   0
D.) PENDING FX CONTRACTS RECEIVABLE                            -                 -                    -   0
E.) PENDING FX CONTRACTS - PAYABLES                            -                 -                    -   0
F.) INCOME RECEIVABLE                                          -                 -                    -   0
G.) CURRENCY BALANCES                                          -                 -                    -   0
H.) MANAGER FEE ACCRUALS                                       -                 -                    -   0

      NET ASSET VALUE (Stated in USD):   $                     -   $             -   $                -
      (B+C+D+E+F+G+H)

      MELLON FINAL NAV:                  $                     -
      EXPLANATION OF VARIANCE:           0
                                         0



      INVESTMENT MANAGER SIGNOFF:        0

      MELLON GSS SIGNOFF:                0




                                                                                           54
[Type text]

ATTACHMENT 3

METHODOLOGY DIFFERENCES

I. Pricing

        The Manager should address questions regarding pricing challenges to PRIM’s
        Client Service Officer at the Custodian.

II. Amortization.

        Custodian accrues interest on bonds and does not amortize.

III. Trade date vs. settlement date accounting.

        Custodian reflects all holdings as of trade date.

IV. Exchange rates.

        Custodian uses RT12 (Reuters 12 Noon London time, last trading day of the
        month) exchange rates to establish the dollar price of non-dollar securities.

V. Posting of dividends and interest.

        Custodian reflects dividend and interest income as of ex-date.
        Custodian accrues interest income daily based on the parameters of the fixed
        income instrument.

VI. Computation of realized gain and loss.

        Custodian calculates the average cost of each security in the portfolio and uses
        this as a basis from which to compute the realized gain or loss on the position.




                                                                                      55
[Type text]



ATTACHMENT 4

PENSION RESERVES INVESTMENT MANAGEMENT
Monthly Performance Information

TO:           [Custodian]                        PHONE#:
                                                 FAX#:


FROM:                                            Phone#:

COMPANY:      Fax#:

SSB FUND:


MONTH:

                                                           Prior Month     Current Month
Month End Market Value:
Net Cash Flow (Contributions/Withdrawals)
Portfolio Management Fee

                                                           Rate       of    Rate        of
                                                           Return           Return
                                                           Gross of Fees    Net of Fees
Investment Results:
Current Month
Year to Date


Comments (Major Flows, Corrections to prior month values or returns):




THIS COMPLETED DOCUMENT MUST BE RECEIVED BY CUSTODIAN NO LATER THAN THE
END OF THE SEVENTH BUSINESS DAY AFTER MONTH END, IN ORDER FOR
RECONCILIATION TO BE COMPLETE.


                                                                                56
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                   EXHIBIT C
                Disclosure Forms

              PRIM Disclosure Form

              PERAC Disclosure Form




                                      57
[Type text]




COMMONWEALTH OF MASSACHUSETTS
PENSION RESERVES INVESTMENT MANAGEMENT BOARD

DISCLOSURE STATEMENT


FIRM:              _________________________
ADDRESS:           _________________________
                   _________________________
                   _________________________

Firms seeking to provide investment management or consulting services (the
“engagement”) to the Commonwealth of Massachusetts Pension Reserves Investment
Management Board (“PRIM”) must complete a disclosure statement providing
complete and accurate responses to the questions below. Firms selected to provide
investment management or consulting services to PRIM have a continuing obligation
to update responses to these questions, in writing, immediately upon any change to
such responses. The questions in this Disclosure Statement should be read broad, and
any perceived ambiguity should be resolved in favor of disclosure. Any questions
concerning the disclosures required should be directed to the PRIM Board’s Executive
Director.

1. Describe in detail your firm’s organization structure, and identify any controlling
   stockholders, parents, subsidiaries, affiliates, partners, general partners, or
   principals (all such individuals or entities hereinafter collectively referred to as the
   “firm.”)

2. Identify any relationship of the firm, its joint ventures, consultants, lobbyists,
   subcontractors, agents, or placement agents that relate in any way to the
   engagement.

3. Aside from the engagement, describe any services provided by the firm to PRIM.

4. Aside from the services described in response to question no. 3, above, describe
   any services provided by the firm to the Office of the Treasurer or any trust, board,
   commission or authority of which the Treasurer is a member or trustee. (A list of
   such entities is attached.)

5. Aside from the services described in response to question nos. 3 and 4, above,
   describe any services provided by the firm to the Commonwealth of Massachusetts
   or any of its political subdivisions.

6. Did or will the firm provide or share, agree to provide or share, or arrange to
   provide or share any compensation or benefit, direct or indirect, to any individual
                                                                                         58
[Type text]

    or entity for assisting the firm in:

    a) obtaining the engagement; or,
    b) performing the services required by the engagement.

    If the answer to question no. 6 is “yes,” provide for each the individual or entity

    a) the name and address of such individual or entity;
    b) a description of the assistance provided; and
    c) the compensation or benefit.

7. Does the firm have any ongoing relationship, arrangement or agreement with any
   individual or entity with respect to sharing compensation for services to:

    a) PRIM;
    b) any trust, board, commission, or authority of which the Treasurer is a member
       or trustee; or
    c) Massachusetts or its political subdivisions?

    If the answer to question no. 7 is “yes,” provide for each such individual or entity

    a) the name and address of such individual or entity;
    b) a description of the relationship, arrangement or agreement; and,
    c) the compensation shared.



Signed under the pains and penalties of perjury on this day of _______________, 2012.




                      Name:

                      Title:




                                                                                           59
[Type text]

Treasurer’s Principal Boards, Commissions and Authorities

1) Finance Advisory Board – M.G.L. c.6, s97-8

2) State Comptroller’s Advisory Board – M.G.L. c.5A, s2

3) Investment Advisory Council – M.G.L. c.10, s5B

4) State Retirement Board – M.G.L. c.10, s18

5) State Lottery Commission – M.G.L. c.10, s23

6) Emergency Finance Board – M.G.L. c.10, s47

7) Board of Bank Incorporation – M.G.L. c.26, s5

8) Water Pollution Abatement Trust – M.G.L. c.29, s2

9) Pension Reserves Investment Management – M.G.L. c.32, s23(2A)

10) Massachusetts Convention Center Authority – Chapter 190 of the Acts of 1982 ss31-
    48




                                                                                   60
[Type text]



                                   PERAC Disclosure

Please obtain the PERAC disclosure form at the following website, fill it out, and submit
    together with the COMMONWEALTH OF MASSACHUSETTS PENSION RESERVES
                 INVESTMENT MANAGEMENT BOARD disclosure form:

         http://www.state.ma.us/perac/forms/0803disclosurestatementim.pdf




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[Type text]




                                   EXHIBIT D
                              PRIM Investment Policy
              Please go to the link below to see the Investment Policy:
                      http://www.mapension.com/investments




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