101214 Placement Agent Status Report

STATE OF NEW MEXICO STATE INVESTMENT OFFICE

STATUS REPORT CONCERNING INVESTIGATION OF

PLACEMENT AGENTS AND RELATED INVESTMENT

MANAGERS

Issued December 14, 2010

http://www.sic.state.nm.us/index.htm�

TABLE OF CONTENTS

I. INTRODUCTION

II. PLACEMENT AGENT USAGE IDENTIFICATION

A. QUESTIONNAIRE B. REPORTING TO SEC/DOJ C. OUTSIDE COUNSEL ENGAGEMENT

III. DOCUMENT PRODUCTION AND INTERNAL REVIEW

A. DOCUMENT COLLECTION, REVIEW AND PRODUCTION B. INTERNAL REVIEW C. FACTUAL PRESENTATIONS D. COOPERATION WITH GOVERNMENT INVESTIGATORS E. FEES CHARGED BY PAUL HASTINGS

IV. MITIGATION & CORRECTIVE EFFORTS

A. TRANSPARENCY AND DISCLOSURE POLICY B. ENNIS KNUPP C. LEGISLATIVE OVERHAUL D. NEW SIC COMMITTEES E. CODE OF ETHICS F. OTHER STRUCTURAL CHANGES G. LEGAL RECOVERY

i. SIO INDEPENDENT EFFORTS ii. RFP FOR OUTSIDE RECOVERY COUNSEL

V. CURRENT STATUS & CONCLUSION EXHIBIT A – PLACEMENT AGENT QUESTIONNAIRE EXHIBIT B – PLACEMENT AGENT SPREADSHEET – APRIL 17, 2009 EXHIBIT C – PLACEMENT AGENT SPREADSHEET – JUNE 30, 2009 EXHIBIT D –INFORMATION REQUESTS AND SUBPOENAS EXHIBIT E – RESOLUTION OF THE SUBCOMMITTEE EXHIBIT F – REPORT AND RECOMMENDATION OF THE SUBCOMMITTEE – FEB 21, 2010 EXHIBIT G – ENNIS KNUPP LIST OF RECOMMENDATIONS FROM SIC FIDUCIARY REVIEW EXHIBIT H – SIC INVESTMENT, AUDIT & GOVERNANCE COMMITTEE CHARTERS

I. INTRODUCTION The New Mexico State Investment Office (“SIO”) issues this Status Report Concerning Investigation of Placement Agents and Related Investment Managers (the “Report”) in order to update its oversight bodies and beneficiaries of the permanent funds, and the citizens of the State of New Mexico, on issues relating to the use of placement agents in connection with investments made by the SIO and the New Mexico State Investment Council (“SIC”). The Securities & Exchange Commission (“SEC”) and the United States Attorney’s Office for the District of New Mexico, working in conjunction with the Federal Bureau of Investigation (together the ““DOJ”) each have active investigations pending, relating to the use of placement agents in New Mexico. The SIO and SIC completed document productions to the SEC and DOJ in late May 2010, and continue to cooperate with the investigations. The SIO and SIC have also worked with the Office of the New Mexico Attorney General (“AG”) to hire outside counsel in order to seek civil remedies from potential defendants for losses and damages arising from the inappropriate use of placement agents. Due to the on-going investigation by the federal authorities and the recovery efforts of the SIO, SIC and AG, this Report will not convey any information that is confidential or privileged. This Report is also not intended to waive any privilege relating to the specific issues or circumstances that will be described in this Report, or to any document or communication related to the issue of placement agents used in connection with investments by the SIO or SIC. II. PLACEMENT AGENT USE IDENTIFICATION

A. Questionnaire On March 19, 2009, the SEC filed a complaint against Henry “Hank” Morris, David J. Loglisci and certain Morris-affiliated companies in New York regarding placement agent payments made in connection with investments by the New York State Common Retirement Fund. Aldus Equity Partners (“Aldus”), the SIO’s former private equity consultant, although not a named defendant, was referenced in the complaint On the same day, the New York Attorney General’s Office announced that it had secured an indictment against Morris and Loglisci based on the same misconduct. Aldus, although not a named defendant, was referenced in the indictment. Further, also referenced in both New York actions were several investment managers with whom the SIC had conducted investment business in New Mexico.

SIC. The Questionnaire is attac

Two business days after the filing of the suit in NY, the SIO’s General Counsel (“GC”) sent a questionnaire (the “Questionnaire”) to all investment managers1 requesting detailed disclosures concerning placement agent use in connection with investments by the SIO and

hed as Exhibit A.

1 The Questionnaire was sent only to investment managers that were managing funds on behalf of the SIO/SIC as of March 2009.

After receiving the responses to the Questionnaire, reviewing the responses, and performing additional follow-up with particular investment managers, the GC and the Deputy State Investment Officer compiled a placement agent spreadsheet that detailed the investment manager name, whether or not the investment manager used a placement agent or sub-agent, the names of the placement agent firms and individual placement agents, and the amount paid to each placement agent. The SIO publicly released its placement agent spreadsheet at a special meeting of the SIC held on April 17, 2009. The spreadsheet is attached hereto as Exhibit B. That spreadsheet was later updated and released on June 30, 2009 and is attached hereto as Exhibit C.

B. Reporting to DOJ and SEC Prior to publicly releasing its placement agent spreadsheet, the SIO reported its findings to the DOJ and the SEC.

Thereafter, the SIO received formal information requests and subpoenas from the SEC and DOJ (collectively the “Subpoenas”) as custodian of records for the SIC. The Subpoenas sought a broad range of materials relating to the role of placement agents in investments made by the SIO and SIC during the years 2003 through 2009 (the “Responsive Time Period”).

The SIO and external counsel (see below), as contact points for the SEC and DOJ and on behalf of the then State Investment Officer (Gary Bland) and the SIC, received an additional subpoena for the testimony of Gary Bland and an additional formal information request for certain documents held by SIC members who served from January 1, 2003 to November 25, 2009. Both the subpoena and information request were issued by the SEC. A copy of all the formal DOJ and SEC information requests and subpoenas are attached as Exhibit D.

C. Outside Counsel Engagement The GC believed it was critical for the SIO to retain outside counsel to help the SIO cooperate with the federal authorities, attempt to identify any wrong-doing, rectify any wrong-doing, and build a case for recovering any losses or damages. The SIO had an existing contract with the law firm of Paul, Hastings, Janofsky & Walker LLP (“Paul Hastings”),2 which had considerable expertise with SEC investigations, DOJ investigations, internal reviews, finance and investments. The Paul Hastings contract included broad language in the scope of work (for securities investments and securities law matters) that allowed for the SIO to properly utilize that firm’s services for the particular issues described

2 Paul Hastings was originally hired in 2005 through a competitive procurement process.

in this Report.3 No other law firm that the SIO had an existing contract with possessed either the expertise required or contract language that could be legitimately relied upon for the services required.

After the GC interviewed the Paul Hastings lawyers who would perform the work and was satisfied with their independence and competence, the GC authorized Paul Hastings to begin work in early summer of 2009.

Because of the impending deadlines, Paul Hastings’ work initially focused on assisting the SIO with responding to the Subpoenas. Thereafter, on or about October 20, 2009, Paul Hastings was retained by a Subcommittee of the New Mexico State Investment Council (the “Subcommittee”).4 The Subcommittee and the GC requested that Paul Hastings expand its work to include an internal review of the facts and circumstances relating to the role of placement agents in investments made by the SIO and SIC (the “Internal Review”).

III. Document Production and Internal Review In order to respond to the Subpoenas and conduct the Internal Review, Paul Hastings worked with the GC and performed, among other things, the following general tasks:

1. Identified, gathered and reviewed millions of pages of documents and electronic data potentially responsive to the Subpoenas;

2. Produced responsive, non-privileged documents and electronic data to the SEC and the DOJ;

3. Identified attorney-client privileged documents and prepared a privilege log;

4. Identified documents potentially subject to a claim of executive privilege by the Governor and communicated with the Governor’s Office to determine whether Governor Richardson planned to assert the privilege, and if so, with respect to which documents;

5. Conducted interviews of relevant employees and third parties;

6. Communicated with the GC, the SEC, and DOJ;

7. Conducted research and provided legal advice regarding various issues of law; and

8. Made several presentations concerning its Internal Review to the GC (and later to

3 The SIO is statutorily exempt from the requirements of the Procurement Code for contracts for investment advisory services, investment management services or other investment-related services. See, Section 13-1-98(CC) NMSA 1978. 4 The Subcommittee was comprised of the following members: State Land Commissioner Patrick Lyons, Andrew Davis (public member), Stephen L. Feinberg (public member) and Peter Frank (public member).

the GC and Steven Moise5), the Subcommittee, the DOJ, the SEC and the AG.

A. Document Collection, Review and Production Paul Hastings conducted initial interviews of various SIO employees in order to identify those individuals who may possess information responsive to the Subpoenas and relevant to the Internal Review (the “Custodians”).

At the direction of Paul Hastings, Kroll Ontrack, an independent computer forensic and litigation support firm, imaged all identified SIO computers and hard drives used by the Custodians, as well as numerous back-up tapes and various file servers. In total, Kroll Ontrack forensically collected approximately 6.2 terabytes of data – or the approximate equivalent of 2 billion pages – from these electronic sources (the “Electronic Data”). In addition to securing the Electronic Data, Paul Hastings collected approximately 10,000 pages of hard copy and paper documents from the Custodians and/or files maintained by the SIO and staff members (the “Hard Copy Materials”).

In total, approximately 2.4 million pages of Electronic Data and Hard Copy Materials were reviewed by Paul Hastings attorneys to determine whether they were: (1) responsive to the Subpoenas; (2) potentially subject to a claim of attorney-client privilege by the SIO; or (3) potentially subject to a claim of executive privilege by the Office of Governor Bill Richardson (the “Document Review”). In addition, the reviewing attorneys categorized documents according to various substantive issues relevant to the Internal Review and identified additional documents of possible interest. Certain documents identified by the review team were selected for additional review and follow-up through the interview process described below.

Over the course of the Document Review, Paul Hastings made approximately forty (40) productions of responsive, non-privileged documents to the SEC and the DOJ. With the exception of certain documents currently under review by the Office of Governor Richardson (as discussed below), Paul Hastings completed its review and the production was completed in late May 2010. In total, Paul Hastings produced, on behalf of the SIO, more than 1.5 million pages to both the DOJ and SEC. Prior to Paul Hastings’ engagement, the GC on behalf of the SIO had produced approximately 9,000 pages.

During the review, certain documents were identified as potentially subject to the SIO’s attorney-client and/or work product privileges. The Subcommittee, SIO and SIC elected not to assert the executive/deliberative process privilege so as to continue to cooperate with the SEC and DOJ. After a review to identify privileged documents, Paul Hastings provided the SEC and the DOJ with a 258-page privilege log identifying approximately 4,700 attorney-client privileged documents withheld from production, a small fraction of the total documents reviewed or produced. All responsive, non-privileged materials and potentially

5 Mr. Moise became the State Investment Officer effective April 1, 2010. He became the State Investment Officer on May 25, 2010, after being approved by the newly constituted SIC.

executive privilege documents6 were produced.

In addition, during the Document Review, certain responsive documents were identified as potentially subject to a claim of executive privilege by Governor Bill Richardson. All of these documents were provided to the Governor’s Office for review. Any documents for which Governor Richardson did not assert a privilege were turned over to the SEC and DOJ by Paul Hastings. The Governor’s Office was responsible for creating a privilege log for the DOJ and the SEC, identifying each of the documents withheld under a claim of executive privilege. To date, that work is ongoing.

B. Internal Review At the direction of the Subcommittee and the GC, the Internal Review focused upon the following areas:

i. the role, if any, played by certain placement agents and third-party marketers (collectively, “placement agents”) in marketing investments to, or in the ultimate investment decisions of, the SIO;

ii. the role and knowledge of SIO staff, consultants and investment managers concerning the financial interests of certain placement agents in investments;

iii. the level of disclosure, if any, to the SIC and the Private Equity Investment Advisory Committee concerning the financial interests of certain placement agents in investments;

iv. whether the SIO’s investment process was tainted, by among other things, payment of placement fees; and

v. gathering evidence and information that may be useful for counsel in recovering funds for the SIO.

Paul Hastings conducted interviews of various individuals and representatives of entities in connection with its Internal Review, including current and former employees of the SIO, consultants and investment advisors to the SIO and certain investment managers who paid placement fees in connection with an investment by the SIO and SIC.7

C. Presentations

Based on information learne

d through the above-described interviews and review of

6 The SIO and SIC did not assert the executive privilege on behalf of either the SIC or State Investment Officer. The Governor has asserted the privilege for his documents. 7Due to budget concerns, in early February 2010, the Subcommittee directed Paul Hastings to forego further interviews and to conclude the Internal Review. As a result, initial and/or follow-up interviews with other relevant individuals and representatives of entities were not attempted or conducted.

documents, Paul Hastings made several presentations to the GC and Subcommittee (the “Presentations”).

After a presentation on October 20, 2009, the Subcommittee passed a resolution that recommended that that SIC 1) express “no confidence” in the State Investment Officer, Gary Bland, 2) restrict certain duties of Gary Bland, 3) request that the Governor investigate whether grounds exist to remove Gary Bland from office, and 4) direct outside counsel to continue to review information concerning the SIO and report to the Subcommittee (the “Resolution”). The Resolution is attached as Exhibit E.

On October 21, 2009, the Subcommittee requested that an emergency meeting of the SIC be held the next day, at which meeting the Resolution would be presented to the SIC. Gary Bland resigned as State Investment Officer on October 21, 2009 and the emergency SIC meeting was cancelled.

At the regularly scheduled meeting of the SIC on October 27, 2009, Governor Richardson appointed Robert Jacksha, a former Deputy State Investment Officer, and then Chief Investment Officer of the Educational Retirement Board, as Interim State Investment Officer. On the same date, the Subcommittee directed Paul Hastings to make a presentation to the Subcommittee regarding Robert Jacksha’s previous tenure at the SIO, and a search committee appointed by the Governor agreed to work efficiently with the Council to make a recommendation for a permanent State Investment Officer. In February of 2010, the legislature passed Senate Bill 18, which restructured the composition and expanded the authority of the Council, while largely removing investment powers from the State Investment Officer. Subsequently, Jacksha announced his resignation as Interim State Investment Officer, to be effective April 1, 2010 and returned to his position as chief investment officer for the Educational Retirement Board.

D. Cooperation with Government Investigators At the direction of the Subcommittee and the GC, the SIO and Paul Hastings have fully cooperated with the investigations being conducted by the DOJ and the SEC. In addition, the SIO requested the assistance of the AG in recovering funds on behalf of the SIO (see below). To date, such cooperation with the DOJ, the SEC and the AG has included, among other things, conducting numerous telephone conferences with the SEC and DOJ to discuss the status of review and production, providing oral briefings to the SEC, the DOJ and the AG regarding facts of the Internal Review, and responding to oral requests for additional documents and information.

E. Fees Charged by Paul Hastings Recognizing the importance of these matters to the SIO’s business and the strong public interest in conserving taxpayer funds, the GC and Subcommittee requested that Paul Hastings employ various measures in order to provide the GC and the Subcommittee with efficient cost-effective representation in a wide-ranging investigation with highly complex factual and legal issues.

First, Paul Hastings discounted the standard billing rates of ten (10) lawyers conducting

initial document review by 50%. These lawyers spent approximately 2,600 hours conducting the review.

Second, Paul Hastings utilized summer associates for various research assignments and agreed not to charge the Office for any portion of their time. These summer associates spent approximately 92 hours performing their tasks. Third, Paul Hastings employed contract attorneys with significantly lower billing rates in order to assist with the review of potentially privileged materials and the creation of a privilege log. Finally, Paul Hastings agreed to provide various legal services requested by the Subcommittee for the amount remaining under the amended contract. In addition to the other hourly rate discounts, the SIO was not billed for an additional $775,000 of attorney time. In total, the SIO paid Paul Hastings $5,088,454.39 for the services described in this Report.8

IV. Mitigation & Corrective Efforts

A. Transparency and Disclosure Policy On July 28, 2009, the SIC adopted a Transparency and Disclosure Policy (“Transparency Policy”) that, in pertinent part, prohibits an investment manager from being able to receive an investment from the SIO or SIC if that investment manager utilizes a placement agent in connection with obtaining business. The Transparency Policy also requires investment managers to make comprehensive and detailed disclosures about their relationships with third parties and places prohibitions on campaign contributions. The Transparency Policy outlines severe penalties for any violation of its terms. On June 22, 2010, the Transparency Policy was amended by changing the complete ban to a prohibition specifically targeted at prohibiting an investment manager from receiving an investment from the SIO or SIC if the manager retains a placement agent with respect to the contemplated investment by the SIO or SIC. This amendment was necessary in order to allow the SIC and SIO to continue to make investments. The SIO and SIC had found that the complete prohibition9 was not prudent and did not allow for the SIO and SIC to be able to properly manage the permanent funds.

B. Ennis Knupp

retained Ennis, Knupp & Assa d f uciary review of the

The State of New Mexico Legislative Council Service and the State Board of Finance ociates, Inc. (“EK”) to conduct an independent operational governance, organizational structure, and current policies, n id

8 Paul Hastings also provided other services, namely reviewing and helping negotiate alternative investments such as Hedge Fund of Fund and Credit and Structured Finance Services deals. These services were performed from August 5, 2005 until early 2010. 9 The complete ban limited the SIO and SIC’s investment opportunities to an unacceptable level. The Transparency Policy became unworkable because, for example, if an investment manager hired a placement agent to help solicit investments in Dubai (because the manager did not have a presence there) and that placement agent would only be paid for the investment made by an investor in Dubai, the SIO and SIC still could not make an investment with that manager.

procedures, and practices of the SIO and SIC, as well as the ERB and the PERA. The purpose of the reviews was to provide an independent evaluation of the governance and operations compared to both common industry standards and best practices. EK issued a report on their process and findings on February 28, 2010. Among other things, the SIO and SIC report included 82 recommendations on policies, procedures and practices. Soon after the report was released, the SIO and SIC began evaluating the findings in order to implement the applicable policies, procedures and practices identified in the report. To date, the SIO and SIC have implemented many of these findings and continue to address the remainder. A spreadsheet reflecting this process is attached to this report as “Exhibit G”

C. Legislative Overhaul The 2010 Legislature passed an emergency bill that was signed into law by Governor Richardson that implemented some of the "best practices" recommendations made in the EK report. One concern raised in EK’s report was the Governor's significant influence and control over the SIC and SIO. To deal with this concern, the Legislature changed the makeup of the SIC by replacing the State Investment Officer and the three public members appointed by the Governor with four public members appointed by the New Mexico Legislative Council and two public members appointed by the Governor. The Legislature removed from the Governor the ability to appoint the State Investment Officer and assigned that responsibility to the SIC as a whole. The bill also transferred the investment decision-making power from the State Investment Officer to the SIC. This transfer was for all investment decisions not just private equity and film investments, as was the case under prior legislation.

D. New SIC Committees Recognizing the importance of implementing “best practices” and providing additional oversight of the operations of the SIO, on April 27, 2010, the SIC approved the formation of three new Committees, the Investment Committee, Audit Committee and Governance Committee (together the “Committees”). The Investment Committee’s Charter was adopted on May 25, 2010. In general the Investment Committee is charged with reviewing and making recommendations to the SIC on all investment-related matters, other than those under the purview of the Private Equity Investment Advisory Committee – a statutorily created entity. The creation of Investment Committee ensures that all investment decisions are fully vetted by those with oversight over the SIO. The Audit Committee’s Charter was adopted on July 27, 2010. The Audit Committee is tasked with monitoring and providing oversight over the SIO’s accounting, financial reporting, compliance, risk management, information security, privacy practices, data protection, operational management best practices and management of internal control

processes. The creation of this committee ensures that the back office activities of the SIO are responsible, and appropriately performed. The Governance Committee’s Charter was also adopted on July 27, 2010. In general, the Governance Committee is to undertake governance responsibilities over SIC membership, SIC committee membership, director independence, SIC member performance, compensation matters, SIC agenda setting, and developing, recommending and overseeing governance guidelines and Codes of Conduct and Ethics. The creation of this committee will help ensure that both the SIO and SIC are run responsibly and ethically. The charters for these three committees are attached to this report as ‘Exhibit G’.

E. Code of Ethics The SIO has begun to implement a comprehensive compliance program. As a significant first step, the SIO, through the State Investment Officer, adopted a Code of Ethics on September 3, 2010. The Code of Ethics is applicable to all employees of the SIO. Among other things, the Code of Ethics outlines the responsibilities of each employee as a fiduciary to the funds. The Code of Ethics also creates a mechanism for the oversight and monitoring of employees’ actions and allows for reporting of violations to the Legal Department, State Investment Officer or SIC Governance Committee. To encourage reporting of potential violations, the Code of Ethics provides for whistleblower protections for employees who identify and report potential violations of the Code of Ethics or other possible wrong-doing.

F. Other Structural Changes

The State Investment Officer, working under the guidance of the Council, continues to pursue efforts to improve efficiency, transparency and ethics at the SIC: The Governance Committee will consider recommending to the Council a Code of Conduct for Council Members later this year; the State Personnel Office has completed an organizational evaluation regarding SIC staffing, and seven staff members have left the SIC in the past six months; the Council has terminated more than a half-dozen underperforming external investment managers since May; following a nationwide search, the Investment Officer hired his new Deputy, Vince Smith, the former Chief Investment Officer at the Kansas Public Employees Retirement Fund, who will oversee SIC investment policy and day to day investment execution; and staff is actively assessing the SIC’s present asset allocation, while a thorough review of all SIC investment policies is ongoing.

G. Legal Recovery

i. SIO Independent Efforts

The SIO has itself attempted to recover losses or damages due to the potentially inappropriate use of placement agents. To date the SIO has recovered over $260,000. This number is expected to increase substantially as a result of hiring external counsel to pursue recovery of losses and damages.

ii. RFP for Outside Recovery Counsel

On June 7, 2010, the SIO and SIC partnered with the AG to issue an RFP for legal recovery services. The evaluation committee for the RFP included two representatives from the SIC, a representative of the AG, the State Investment Officer and the GC10. After an evaluation process and finalist interviews, the evaluation committee selected Day Pitney as the successful offeror. The entire SIC approved the retention of Day Pitney LLP on August 24, 2010. On August 26, 2010, the SIO, SIC and AG entered into an agreement with Day Pitney LLP to pursue losses and damages related to inappropriate use of placement agents.

10 Specifically the evaluation committee consisted of: the State Land Commissioner Patrick Lyons, SIC Public Member Peter Frank, Assistant Attorney General Scott Fuqua, and SIO General Counsel Bryan Otero.

EXHIBIT A

State of New Mexico

STATE INVESTMENT COUNCIL41 Plaza La Prens a

Santa Fe, New Mexico 87507Phone : (505) 424-9500

Fax: (505) 424-2510BILL RIC HARD SON

GOVERNOR

Tuesday, March 24, 2009

VIA EMAILTO: SIC Investment Manager/Consultant/Contractor

RE: Information Request

Ladies and Gentlemen:

GARY B. BLANDSTATE INVESTM ENT OFFI CER

As part of the New Mexico State Investment Council 's ongoing compliance and monitoringinitiative, we request that the following information be sent via email tocompliance [email protected], with "Compliance Request - (Manager Name)" in the subject line.Your response to items 1 and 2 (a-f) is due by 4:00 pm, MDT, Friday, March 27,2009. Thedocuments/agreements responsive to items 2 (g-h) should be provided by 4:00 pm, MDT,Wednesday, April 1, 2009.

1) Have you hired, engaged, retained in any capacity or paid in any manner, any company orindividual in connection with the investment/allocation made by the State InvestmentCouncil ("SIC")? This includes, but is not limited to, the retention of consultants , newemployees, 3rd party marketers, placement agents, finders, or any other individual orentity, as well as, the payment of any fee or grant of any interest (LP, GP) or other thingof value.

2) If yes, please provide:a. The names of any and all individuals, companies and the principals of those

companies who were hired, engaged, retained, received any remuneration, orshared in any remuneration.

b. The names of the individuals who were the contact and negotiated theremuneration,

c. The amount and description of any remuneration. In the case of an employmentrelationship or consulting arrangement, please fully describe the nature of therole, responsibilities and salary/wage/payment. In the case of an interest, pleaselist and describe the nature of the interest and provide a value.

d. Justify the hiring of any company or individual in connection with investmentmade by SIC. For example, for a 3rd party marketer/placement agent/finder pleasedetail the advantages of such hiring and their specific expertise.

e. Detail the roles/functions/responsibilities for each company or individual hired,retained or engaged. What specific services were performed?

f. Provide the dates of hire, engagement, retention and termination for eachcompany or individual.

Page 1 of 2

BILL RICHARD SONGOVERI'\OR

State of New MexicoSTATE INVESTMENT COUNCIL

GARY B. BLANDS1''\TE II'\VESDI D ;T OFFICER

g. Provide any all agreements between the Manager and any company or individualhired , retained or engaged .

h. Provide any all agreem ent s between any company or indi vidual hired , retained orengaged and any other company or individual who may have shared anyremuneration.

Thank you for your prompt attention to this request. If you have any questions, please contactthe undersigned at 505-476-951 2.

( '1l~6l0~Bryan A:oustin Otero , JD , LLMChief General Counsel & Complianc e Officer

Page 2of 2

EXHIBIT B

EXHIBIT C

Individual(s) GP or Fund Name

Amt Rec'd by Individual &/or

Broker Broker or Company Sub‐Agent Department

Vintage or Allocation

Year Amount of Commitment Fee Terms

1

Richard AllsoppJames MooreMark Schroeder 3i EuroPartners Vb unknown UBS none PEN 2006 31,290,000$ % of overall commitments

2 no response ACA CSF 2004 12,963,600$

3 noneAG Core Plus Realty Fund II, L.P. $ ‐ RE 2007 50,000,000$

4 none AG Core Plus Realty Fund, L.P. $ ‐ RE 2004 50,000,000$ 5 none Alliance Bernstein $ ‐ PEQ6 none Alta Comm IX PEN 2002 20,000,000$ 7 none Alta Comm VIII PEN 2000 8,000,000$ 8 none Altair $ ‐ HF 2005/2006 50,000,000$

Asset Management

No Response or Insufficient response

Requires more follow‐up

Split fee

No marketer used

Note that amount received by individual is an approximation and may in some instances be based on assumptions or information received from 3rd parties. In cases where we do not know the exact amount of the fee split between the broker and the individual listed below we have apportioned the entire fee received by the broker to the individual. Additionally, the information gathered is based upon responses by the General Partner or Fund and was gathered and input very quickly. There is no guarantee that such information is accurate or complete.

9 Dirk McDermott Altira Technology Fund IV, L.P. $ 200,000 Services none disclosed PENM 2003 10,000,000$ 2% of Capital Commitment

10 Marc CorreraAmerican Value Partners Fund I, L.P. $ 250,000 Wetherly Ajax RE 2007 50,000,000$ Marc received entire fee

11Jane MorrisDayna Gant Ampersand 2001 unknown Veritage Group none PEN 2001 20,000,000$ 1.5% of Capital Commitment

12 noneAngelo Gordon Realty Fund VII, L.P. $ ‐ RE 2007 75,000,000$

13 none Apax VI $ ‐ PEN 2005 32,320,000$ 14 none Apax VII $ ‐ PEN 2007 43,917,000$ 15 none Apex IV $ ‐ PEN 1999 10,000,000$ 16 none Apex V $ ‐ PEN 2001 15,000,000$ 17 none Arch IV $ ‐ PEN 1999 10,000,000$ 18 none Arch IV A $ ‐ PEN 2002 1,000,000$ 19 none Arch V $ ‐ PEN 2000 10,000,000$ 20 none ARCH Venture Fund II, L.P. $ ‐ PENM 1993 1,222,222$ 21 none ARCH Venture Fund III, L.P. $ ‐ PENM 1996 4,000,000$ 22 no response ARES CSF 2004 13,000,000$ 23 Darius & Kirk Anderson Ares Distressed $ 500,000 Gold Bridge Capital none disclosed PEN 2008 50,000,000$ 1% of Capital Commitment24 Darius & Kirk Anderson Ares Special Situations $ 250,000 Gold Bridge Capital none disclosed PEN 2007 25,000,000$ 1% of Capital Commitment


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Split fee

No marketer used


25Dan WeinsteinVicky Schiff Aurora III $ 375,000 Wetherly

GP Notes there may be others that rec'd $ PEN 2004 25,000,000$ 1.5% of Capital Commitment

26 Alfred Jackson Austin $ 2,100,000 Berean none disclosed HF 2005/2008 200,000,000$

33% OF MGT/PERFORM FEE, BUT IN NO EVENT SHALL FEE EXCEED 50 BPS PER YEAR OF AMOUNT INVESTED BY NMSIC.Fee Paid through 12/31/08 is approximately $2,100,000

27 Alfred Jackson Austin Horizon $ 61,875 Berean none disclosed CSF 2008 150,000,000$

/ ,IN NO EVENT SHALL FEE EXCEED 50 BPS PER YEAR OF AMOUNT INVESTED BY NMSIC.

28 none Avenue III $ ‐ PEN 2002 25,000,000$ 29 none AXA ‐ ARIA CSF 2004 15,000,000$ 30 none BABSON CSF 2004 20,000,000$ 31 none BABSON ‐ GREAK LAKES I CSF 2006 29,057,320$ 32 none BABSON ‐ GREAK LAKES II CSF 2006 40,000,000$ 33 none BCI Growth V $ ‐ PEN 1999 10,000,000$ 34 none Beal SIC Holding, LLC $ ‐ RE 2006 22,500,000$ 35 none Benchmark Plus $ ‐ HF 2005 100,000,000$ 36 no response Blackstone Comm I PEN 2000 10,000,000$ 37 no response Blind Horizon $ ‐ FLM 2002 4,780,000$ 38 none Blue Sage Capital, L.P. $ ‐ PENM 2003 10,000,000$ 39 none Bordertown $ ‐ FLM 2005 15,000,000$ 40 none Bridgepoint III $ ‐ PEN 2005 35,358,000$ 41 none Bridgepoint IV $ ‐ PEN 2007 46,551,000$

42 no responseBuried Alive (The Horror Chronicles) $ ‐ FLM 2006 3,450,001$

43 Not requested yetCabrera Capital MarketsCommission Recapture PEQ n/a

44 Alfred Jackson Camden III $ 1,250,000 Inroads Group none disclosed PEN 2004 20,000,000$ buyout by GP

45 Alfred Jackson Camden IV Inroads Group none disclosed PENNot yet closed 25,000,000$

30% of the Adjusted Management Fee

46 no response Candover 2001 PEN 2001 7,046,270$

47none ‐ but Alfred Jackson owns 73% of GP Capital Point Ptrs $ ‐ PEN 2005 20,000,000$










Split fee

No marketer used


48 none Carlyle Mexico PEN 2006 25,000,000$ 49 Henry "Hank" Morris Carlyle Mezz $ 150,000 Searle none disclosed PEN 2004 20,000,000$ 0.75% of Capital Commitment50 none Carlyle Mezzanine II $ ‐ PEN 2008 30,000,000$ 51 none Carlyle Riverstone E&P III PEN 2005 20,000,000$

52 none Carlyle Riverstone Renewable I PEN 2005 20,000,000$ 53 none Carpenter BancFund $ ‐ PEN 2008 25,000,000$ 54 none Carret $ ‐ PEQ 200755 Dan Hevesi Catterton VI $ 250,000 Praetorian none disclosed PEN 2006 25,000,000$ 1% of Capital Commitment

56 none CBA Investment Holdings, LLC $ ‐ RE 2006 80,000,000$ 57 none CHAMPLAIN $ ‐ CSF 2004 25,000,000$ 58 none Charterhouse VII $ ‐ PEN 2002 20,542,000$ 59 none CHL Medical II $ ‐ PEN 2001 15,000,000$

60 noneCHURCH TAVERN ‐ SHERWOOD FUND CSF 2004 19,532,200$

1% of Capital Commitment split61 Dan Weinstein CIM Fund III, L.P. $ 250,000 Wetherly Ajax RE 2007 50,000,000$

1% of Capital Commitment split 50/50 between Wetherly & Ajax

62 Marc Correra CIM Fund III, L.P. $ 250,000 Wetherly Ajax RE 2007 50,000,000$ 1% of Capital Commitment split 50/50 between Wetherly & Ajax

63 none Cinven III $ ‐ PEN 2001 15,041,250$ 64 none Cinven IV $ ‐ PEN 2006 38,871,000$ 65 none Clarity Partners $ ‐ PEN 2000 10,000,000$ 66 Claws 1A A CSF 2004 29,012,356$ 67 Marc Correra Clayton VII $ 900,000 Cabrera none disclosed PEN 2005 50,000,000$ 2% of Capital Commitment68 Marc Correra Clayton VIII $ 675,000 Ajax none disclosed PEN 2008 50,000,000$ 1.35% of Capital Commitment69 no response ClearBridge/Citigroup PEQ 200370 none Coller Intl IV $ ‐ PEN 2002 30,000,000$ 71 none Crash $ ‐ FLM 2008 15,000,000$ 72 none Craton I $ ‐ PEN 2006 19,076,922$

73 no responseCredit Suisse Securities (USA), LLC SL 2001 n/a

74 Eileen Kotecki Crestline $ 915,000 Juniper Capital Guy Riordan HF 2005 100,000,000$

18% OF ALL FEESCrestline & Juniper have terminated the relationship










Split fee

No marketer used


75 Guy Riordan Crestline $ 17,325 Juniper Capital Guy Riordan HF 2005 100,000,000$

.07% of Juniper's fee ‐ Terminated by Juniper in 2006Crestline & Juniper have terminated the relationship

76 noneCrestlineTransfer from Maple Key $ ‐ HF 2007 100,000,000$

77 CRTS 2004‐4 CSF 2004 19,436,751$

78Cruel World (aka The Experiment) FLM 2004 1,700,000$

79 none CT Preferred $ ‐ HF 2005 50,000,000$ 80 none CVC Europe III PEN 2001 10,000,000$ 81 none CVM Equity Fund V $ ‐ PENM 1998 3,000,000$ 82 none Cypress MB II $ ‐ PEN 1999 10,000,000$ 83 no response Davis Hamilton Jackson PEQ 2003

BASE QTRLY SALARY‐$25,000, COMMISSION = 1ST THROUGH 4TH YRS 35%, 5TH YR 25%, AFTER

84 John DeLuna Denali Advisors Unknown DeLuna Partners none disclosed PEQ 2003 15%85 none Dilweg SIC, LLC $ ‐ RE 2005 23,750,000$ 86 none Earnest Partners $ ‐ PEQ 2003

87 Douglas Cramer EIM $ 365,553 Alternative Access Capital none disclosed HF 2006 100,000,000$

YEARS 1‐3: 15% OF MGT & INCENTIVE, YEAR 4: 15% MGT, 10% INCENTIVE, YEARS 5 ON: 10% OF MGT & INCENTIVE, 2006‐ $101,148.24, 2007‐$156,186.42, 2008‐$108,219.31

88 no response Elvis Has Left the Building $ ‐ FLM 2003 7,500,000$ 89 none Employee of the Month $ ‐ FLM 2006 13,002,694$ 90 none Entrust Capital $ ‐ HF 2005 25,000,000$ 91 none Epic Venture Fund IV, LLC $ ‐ PENM 2008 6,400,000$

92 Marc Correra Explorer $ 1,000,000 Cabrera none disclosed HF 2005 100,000,000$

20% OF MGT FEES FOR AS LONGS AS INVESTOREstimated Fees paid are at least $1,000,000 (20% x ($100,000,000 x 1.5%))

93 none Falcon Mezz II $ ‐ PEN 2005 20,000,000$










Split fee

No marketer used


94 none Falcon Mezz III PEN 2008 25,000,000$ 95 Marc Correra Fenway III $ 600,000 Ajax none disclosed PEN 2006 30,000,000$ 2% of Capital Commitment96 Marvin Rosen Fenway III $ 300,000 Diamond Edge none disclosed PEN 2006 30,000,000$ 1% of Capital Commitment97 no response First Quadrant DRV 2008 N/A98 no response First Quadrant PEQ 199899 none First Reserve IX $ ‐ PEN 2001 10,000,000$

100 no response First Snow $ ‐ FLM 2005 7,300,000$

101 noneFive Arrows Realty Securities IV, L.P. $ ‐ RE 2005 61,670,000$

102 none Flywheel I, L.P. $ ‐ PENM 2004 15,000,000$ 103 no response FOUR CORNERS CLO CSF 2005 18,873,460$ 104 none Fox Asset Management $ ‐ PEQ 2003105 none GEAM ‐ NAVIGATOR CSF 2004 15,000,000$ 106 Marc Correra GF Capital PEF $ 600,000 SDN Advisors none disclosed PEN 2006 30,000,000$ 2% of Capital Commitment

Michale HoffmannRobert HofeditzKelly DeponteGreg Hausler

107

Greg HauslerCarig MarmerDale Meyer Gleacher Mezz II $ 350,000 Probitas Funds Group none disclosed PEN 2007 20,000,000$

1.33% on 1st $350MM & 1.75% on above

108 no response Green IV PEN 2003 25,000,000$ 109 none Green V $ ‐ PEN 2006 30,000,000$

110 William R. Howell GSC Recovery III $ 450,000 William R. Howell Pension Enhancement Consulting

Later transferred to Monroe Street PEN 2005 30,000,000$ 1.5% of Capital Commitment

111 no response GSO ‐ HUDSON STRAITS CSF 2004 25,000,000$ 112 no response GTCR VII PEN 2000 6,500,000$ 113 no response GTCR VII A PEN 2000 2,000,000$ 114 none Guggenheim $ ‐ HF 2009 100,000,000$ 115 Dan Prendergast Halyard II $ 600,000 Park Hill none disclosed PEN 2007 30,000,000$ 2% of Capital Commitment116 none Harvest IV $ ‐ PEN 2001 15,000,000$

117 Marc Correra & Paul Cross Hester Capital $ 474,182 Crosscore Management none disclosed PEQ 200325% OF FEE FROM 9/8/03‐9/8/06. TOTAL $474,182.75










Split fee

No marketer used


118 Marc Correra HFV $ 900,000 Cabrera none disclosed HF 2005 100,000,000$

UP TO $250MM ‐ 25% OF ALL FEES, OVER $250MM ‐ 27.5%Fees Paid are approximately $900,000 assuming same deal as TAG

119 Marc Correra HM Capital SPF $ 600,000 Ajax none disclosed PEN 2007 30,000,000$ 2% of Capital Commitment

120Jamir CouchKeith Spears Illinois PEFFund $ 228,301

Knowles Hall Consulting & Keith Spears none disclosed PEN 2005 20,000,000$

121 none In the Valley of Elah $ ‐ FLM 2006 15,000,000$

122 William R. Howell InterMedia VII $ 150,000

William R. Howell Pension Enhancement Consulting & CSFB none disclosed PEN 2005 30,000,000$

Howell got $125,000 & CSFB got 1.25% of Commitment

123 noneInternational Venture Fund I, L.P. $ ‐ PENM 2000 5,000,000$

124 no responseIntervention (aka Funny Farm) $ ‐ FLM 2005 12,420,000$

125 none ITU Ventures New Mexico L P $ PENM 2005 15 000 000$125 none ITU Ventures New Mexico, L.P. $ ‐ PENM 2005 15,000,000$ 126 none ITU Ventures West I, L.P. $ ‐ PENM 2003 15,000,000$ 127 no response JEFFRIES ‐ CLEAR LAKE CLO CSF 2007 11,092,500$

128 Unknown JER Real Estate Partners III, L.P. $588,513 as of June 30, 2007

The Lashine Group & Atlantic Capital none disclosed RE 2004 40,000,000$

LASHINE ‐1% OF FIRST $200M IN COMMIT , ATLANTIC‐$200k RETAINER, 1.50% OF CAP COMMIT UP TO $150mm, 1.75% UP TO $300mm, 2% ABOVE $300mm

129 UnknownJER Real Estate Partners IV, L.P.

$35,622 as of 12/31/08 Atlantic Capital none disclosed RE 2007 125,000,000$

$200k RETAINER, 2% FOR INVESTORS THAT INVEST UP TO $50mm, 2% OF CAP COMMIT,

130 none K2 Advisors $ ‐ HF 2005 50,000,000$ 131 none K2 Alternate $ ‐ HF 2006 50,000,000$

132Julio RamirezMarc Correra KH Growth (Vicente Capital) $ 500,000 Cabrera none disclosed PEN 2007 25,000,000$ 2% of Capital Commitment

133 no response KPS II PEN 2002 15,000,000$ 134 unknown KRG Capital I $ 200,000 Bank of America none disclosed PEN 1999 10,000,000$ 2% of Capital Commitment










Split fee

No marketer used


135Dale MeyerJohn Littlefield KRG Capital II

unknown ‐ $5.5MM on entire fundraising JP Morgan none disclosed PEN 2001 25,000,000$

136 noneLandmark Real Estate Fund V, L.P. $ ‐ RE 2005 75,000,000$

137 none Landmark XI $ ‐ PEN 2002 20,000,000$

138 none Landmark XIV $ ‐ PENNot yet closed

139 none LB CDO OPPORTUNITY II CSF 2007 50,000,000$ 140 unknown Leeds Weld IV unknown Bear Sterns none disclosed PEN 2002 20,000,000$ 141 no response LEHMAN ‐ EXUM RIDGE CSF 2007 11,357,942$ 142 no response LEHMAN ‐ VERDE CSF 2005 13,650,000$ 143 Marc Correra Lehman MBP III $ 350,000 Cabrera Capital none disclosed PEN 2004 20,000,000$ 1.75% of Capital Commitment

144 Marc Correra Lehman MBP IV $ 356,250 Ajax none disclosed PEN 2007 28,500,000$

1% up to $20MM; 1.25% up to $30MM; 1.5% up to $50MM; 1.75% over $50MM

145 Dan Weinstein Levine Leichtman DV $ 250 000 Wetherly Ajax PEN 2005 25 000 000$2% of Capital Commitment split 50/50145 Dan Weinstein Levine Leichtman DV $ 250,000 Wetherly Ajax PEN 2005 25,000,000$ 50/50

146 Marc Correra Levine Leichtman DV $ 250,000 Wetherly Ajax PEN 2005 25,000,000$ 2% of Capital Commitment split 50/50

147 Dan Weinstein Levine Leichtman III $ 350,000 Wetherly Ajax PEN 2003 35,000,000$ 2% of Capital Commitment split 50/50

148 Marc Correra Levine Leichtman III $ 350,000 Wetherly Ajax PEN 2003 35,000,000$ 2% of Capital Commitment split 50/50

149 Dan Weinstein Levine Leichtman IV $ 350,000 Wetherly Ajax PEN 2008 35,000,000$ 2% of Capital Commitment split 50/50

150 Marc Correra Levine Leichtman IV $ 350,000 Wetherly Ajax PEN 2008 35,000,000$ 2% of Capital Commitment split 50/50

151 Alan Pardee Lightyear II not disclosed Merrill Lynch none disclosed PEN 2005 60,000,000$ not disclosed152 Marvin Rosen Lightyear II $ 600,000 Diamond Edge none disclosed PEN 2005 60,000,000$ 1% of Capital Commitment

153 no responseLiving Hell (The Horror Chronicles) $ ‐ FLM 2006 3,858,646$

154 noneLombardia Capital PartnersFormerly Valenzuela Partners $ ‐ PEQ 2003

155 Not requested yetMagna SecuritiesCommission Recapture PEQ n/a










Split fee

No marketer used


156 no response Maple KeyPalladium Capital Advisors, LLC HF 2005 100,000,000$

157 none Mariner Matador $ ‐ HF 2008Brian A. MurdockChristopher O. BluntRobert E. BradyJohn A. CullenMichael G. GalloRobert J. HebronJohn R. MeyerBarry A. SchubBrian A. MurdockChristopher O. BluntScott L. BerlinRobert J. HebronJohn R. Meyer Stephen P. FisherWilliam F. GibsonBarbara McInerneyRobert E. BradyThomas A. Clough

158

Thomas A. CloughWendy K. FishlerMark A. GomezJoseph J. HenehanJulia D. HollandEdward P. Linder Alison H. MicucciMarguerite E. H. MorrisonBeverly J. MooreGary L. WarrenGary M O'NeillAlbert W. Leier Mariner Select NYLIFE Distributors, LLC none disclosed HF 2005 100,000,000$ 32% of Revenue

159 Matthew Gohd Markstone $ 100,000 Pali Capital none disclosed PEN 2004 20,000,000$ 0.5% of Capital Commitment

160 noneMurphree Venture Partners IV, L.P. $ ‐ PENM 1998 4,000,000$

161 noneMurphree Venture Partners V, L.P. $ ‐ PENM 2000 3,000,000$

162 Guy RiordanNew Mexico Co‐Investment Partners, L.P. $ 318,958 Wachovia none disclosed PENM 2004 46,000,000$

163 Marc Correra Newstone $ 600,000 Ajax none disclosed PEN 2006 30,000,000$ 2% of Capital Commitment

164 Marc Correra Newstone II Ajax none disclosed PENNot yet closed 30,000,000$ 2% of Capital Commitment










Split fee

No marketer used


165 none NGN Biomed I $ ‐ PEN 2004 20,000,000$ 166 none NGP ETP II $ ‐ PEN 2008 30,000,000$

167 noneNMSIC Co‐Investment Fund, L.P. (Classic) $ ‐ PENM 2007 30,000,000$

168 noneNMSIC Co‐Investment Fund, L.P. (Focused) $ ‐ PENM 2007 60,000,000$

169 Not requested yet NMSU PEQ 2008 5,000,000$ 170 no response Nordic V PEN 2003 20,534,000$ 171 Marc Correra NorthStar SIC Holding LLC $ 576,917 SDN Advisors none disclosed RE 2006 90,250,000$ $99,866.24 & $447,051.00172 none Oak Hill Capital $ ‐ PEN 1999 10,000,000$ 173 none Oak Investment IX $ ‐ PEN 1999 10,000,000$ 174 none Oak Investment X $ ‐ PEN 2001 15,000,000$ 175 Opera Structured Credit CSF 2006 49,750,000$

176E. Alan BrumbergerLori A. Schiaffino Optima

Diamond Edge Capital Partners, LLC HF 2005 50,000,000$ 20% of all fees

177 no responsePaladin Realty Latin America Investors II, LP RE 2006 25,000,000$

178 none Pharos $ PEN 2004 20 000 000$178 none Pharos $ ‐ PEN 2004 20,000,000$

179Robert ByronPeter Stelian

Place/BV Student Housing Fund, LLC no compensation Blue Vista Capital none disclosed RE 2007 50,000,000$

180Douglas BlagdonScott White Platinum II

unknown ‐ Global mandate Citigroup none disclosed PEN 2007 30,000,000$

(I) 0.25% OF 1ST $1b, (II) 1.5% OF LESS THAN $2b, (III) 2% IN EXCESS OF $2B, CAP OF $25mm ON FEE.

181 none Prism IV $ ‐ PEN 2001 15,000,000$ 182 no response PRUDENTIAL ‐ DRYDEN VII CSF 2004 21,126,000$

183 none Psilos Group Partners IIIB, L.P. $ ‐ PENM 2005 15,000,000$

184 Henry "Hank" Morris Quadrangle II not disclosed Searle Monument PEN 2005 20,000,000$ Quadrangle claims that Searle did not receive a fee for NM

185 Marc Correra Quaker BioVentures II $ 530,000 Ajax none disclosed PEN 2007 26,500,000$ 2% of Capital Commitment

186 Omar Barbarosa RC/Fontis $ 150,000 unknown ‐ verbal agreement none disclosed PEN 2005 20,000,000$

187 none Red River Ventures, L.P. $ ‐ PENM 2000 7,166,667$ 188 none RedShift II $ ‐ PEN 1998 10,000,000$ 189 none Sequel II $ ‐ PEN 1999 10,000,000$ 190 none Sequel III $ ‐ PEN 2000 17,500,000$










Split fee

No marketer used


191 Seraphim Falls $ ‐ FLM 2005 15,000,000$ 192 none SIC/Leed, LLC $ ‐ RE 2005 15,000,000$ 193 Marc Correra Silver Creek II $ 188,333 SDN Advisors none disclosed PEN 2005 9,416,667$ 2% of Capital Commitment194 none Simms Global Investors $ ‐ PEQ 2003195 Julio Ramirez St. Cloud II $ 400,000 PEN 2007 20,000,000$ verbal agreement196 no response Sterling Capital PEN 2002 15,000,000$

197 Marc Correra STONE TOWER $ 132,608 Ajax CSF 2008 100,000,000$ 20% of all fees$132,608 as of end of 1st Qtr '09

198 noneStrategic Partners Value Enhancement Fund, L.P. $ ‐ RE 2006 38,125,000$

199 no response Summit VI B PEN 2001 5,000,000$ 200 no response Suspect Zero $ ‐ FLM 2002 7,500,000$ 201 none Swing Vote $ ‐ FLM 2007 15,000,000$ 202 none TA IX $ ‐ PEN 2000 10,000,000$ 203 none TA Sub Debt $ ‐ PEN 2000 10,000,000$ 204 none TA VIII $ ‐ PEN 1997 1,250,000$

UP TO $250MM 25% OF ALL

205 Marc Correra TAG Offshore $ 1,294,000 Cabrera none disclosed HF 2005 100,000,000$

UP TO $250MM ‐ 25% OF ALL FEES, OVER $250MM ‐ 27.5%Fees Paid Through 12/31/08 are approximately $1,294,000

206 no response TCS ‐ DAVIS SQUARE CSF 2004 24,937,500$ 207 no response TCS ‐ INMAN SQUARE CSF 2004 20,055,313$ 208 none TH Lee V $ ‐ PEN 2000 15,000,000$ 209 none TH Lee VI $ ‐ PEN 2006 30,000,000$ 210 none The Burrowers $ ‐ FLM 2007 7,036,854$ 211 no response The Flock (Tax Credit Loan) $ ‐ FLM 2005 2,300,000$ 212 none The Game $ ‐ FLM 2007 15,000,000$

213

Chad SchultzBob RivettJohn RobertshawRay Cosman Thomas McNerney

unknown ‐ $3.3MM on entire fundraising CSFB none disclosed PEN 2002 20,000,000$

214William D. Forsyth IIIThomas J. Holberg Jr. Thornburg $ 1,276,595 Frontier Partners none disclosed PEQ 2003

20% OF FEE. THROUGH 12/31/08 $1,276,595.23

215 noneTrammell Crow Acquisitions I, L.P. $ ‐ RE 2007 47,316,111$










Split fee

No marketer used


216 noneTrammell Crow Acquisitions II, L.P. $ ‐ RE 2007 150,000,000$

217 no response TRIMARAN CSF 2005 25,931,340$

218 noneTullis/Dickerson Capital Focus II, L.P. $ ‐ PENM 1998 15,000,000$

219 noneTullis/Dickerson Capital Focus III, L.P. $ ‐ PENM 2001 15,000,000$

220 none TVO $ ‐ RE 2004 31,000,000$

221 no responseUndead or Alive: A Zombedy (aka Wanted: Unded or Alive) $ ‐ FLM 2006 3,798,410$

222 none UNM $ ‐ PEQ 2008 5,000,000$ 223 none Valley Ventures II, L.P. $ ‐ PENM 1998 5,000,000$ 224 none Valley Ventures III, L.P. $ ‐ PENM 2002 6,658,988$ 225 Marc Correra VANDERBILT DUNHILL $ 866,000 Crosscore Management CSF 2004 15,500,000$

226 Marc Correra VANDERBILT FINANCIAL TRUST $ 2 000 000 SDN Advisors CSF 2006 50 000 000$

REC'D $2,000,000 in connection with both SIC & ERB ‐ No breakdown provided226 Marc Correra VANDERBILT FINANCIAL TRUST $ 2,000,000 SDN Advisors CSF 2006 50,000,000$ breakdown provided

227 Marc Correra VANDERBILT FORT DEARBORN $ 674,382 Cabrera Capital CSF 2005 27,632,747$

228 Marc CorreraVANDERBILT MONROE HARBOR $ 438,750 Cabrera Capital CSF 2005 11,399,753$

229 Marc Correra VANDERBILT STREETERVILLE $ 950,000 Crosscore Management CSF 2004 25,000,000$ 230 none VANDERBILT TUDOR PLACE CSF 2004 25,000,000$ 231 none VANDERBILT SKY RIVER CSF 2004 21,375,000$ 232 Marc Correra VANDERBILT LAKESIDE II $ 645,000 Crosscore Management CSF 2004 27,600,000$ 233 none Verge I, L.P. $ ‐ PENM 2004 10,000,000$ 234 no response Vestar III PEN 1997 1,250,000$ 235 no response Vestar IV PEN 1999 8,000,000$ 236 none Vestor Partners, L.P. $ ‐ PENM 1998 5,000,000$

237 none Village Ventures Fund II‐B, L.P. $ ‐ PENM 2006 15,000,000$

238 Marc Correra Vintage Classic $ 1,066,000 Cabrera none disclosed HF 2005 100,000,000$

UP TO $250MM ‐ 25% OF ALL FEES, OVER $250MM ‐ 27.5%Fees Paid Through 12/31/08 are approximately $1,066,000










Split fee

No marketer used


239 refused to disclose VMG refused to disclose Park Hill refused to disclose PEN 2006 30,000,000$ refused to disclose240 none vSpring II, L.P. $ ‐ PENM 2003 20,000,000$ 241 none VSS Comm III $ ‐ PEN 1998 10,000,000$ 242 none VSS Comm IV $ ‐ PEN 2004 20,000,000$ 243 none VSS Structured II $ ‐ PEN PEIAC Only244 no response Warburg PEP PEN 1998 10,000,000$ 245 none Warburg Pincus VIII $ ‐ PEN 2001 15,000,000$

246 noneWasatch New Mexico Fund, LLC $ ‐ PENM 2004 12,000,000$

247Jim RoweTodd Stevens Wasatch Venture Fund III, LLC $ 108,750 Rowe Capital Partners none disclosed PENM 2001 8,700,000$

248

Julio RamirezDan PrendergastBrian Levine Wayzata $ 442,500 Park Hill Possible Affiliates PEN 2005 25,000,000$ 1.77% of Capital Commitment

249 none WCAS IX $ ‐ PEN 2000 15,000,000$ 250 none WCAS VIII $ ‐ PEN 1998 10,000,000$ 251 none WCAS X $ PEN 2005 25 000 000$251 none WCAS X $ ‐ PEN 2005 25,000,000$ 252 none WCAS XI $ ‐ PEN 2008 35,000,000$ 253 no response Wellspring III PEN 2002 20,000,000$ 254 none Wildfire ‐ The Pilot $ ‐ FLM 2004 4,094,897$

255 noneWildfire ‐ The Series ‐ Season 1 $ ‐ FLM 2005 15,000,000$




259 none Williams Capital $ ‐ PEN 2004 20,000,000$

260 Unknown Willis Stein III unknown Donaldson Lufkin & Jenrette & CSFB none disclosed PEN 2000 10,000,000$

261 Dan Weinstein YAAF $ 200,000 WetherlyUnknown ‐ Still compiling info PEN 2004 20,000,000$

1% of Capital Commitment ‐ Verbal Agreement

262 no response ZAIS MATRIX V CSF 2006 44,464,213$ 263 Zenith CSF 2004 20,000,000$



EXHIBIT D

APR-24-2009 13:50 us fllTTORt,jE'y DI 3T OF t,jr1 505 346 6887 P. 05/05

US. Department ofJustice

United States AttorneyDistrict ofNew Mexico

Post Office Box 607Albuquerque. New Mexico 87103

April 24, 2009

505/346-7274505/346-7224

FAX 505/346-7296

Custodian of RecordsNew Mexico State Investment Council41 Plaza la PrensaSanta Fe, New Mexico 87507

Re: Grand Jury Subpoena

To Whom It May Concern:

You have been served with a subpoena duces tecum issued by a federal grand jury inconnection with a criminal investigation being conducted in this district. That subpoena directsyou to produce information on June 9,2009, before the grand jury in Albuquerque, New Mexico.

As a convenience to you, you may, if you wish, deliver the requested docwnents toSpecial Agent John D. Fay, Federal Bureau ofInvestigation, 4200 Luecking Park Avenue NE,Albuquerque, New Mexico 87107) (505) 889-1300, in lieu of personally appearing before thegrand jury. Should you choose this option, please prepare the docwnents in some type of sealedpackage and mark on the package, in bright red letters if possible, "GRAND JURYMATERIALS, DO NOT OPEN," and tum them over to the agent who requested them in asealed condition.

If you have any questions, please feel free to contact me at (505) 346-7274.

Sincerely,

GREGORY J. FOURATTUnited States Attome

STEV' C. ARJjRO~Assistant United States Attorney

TOTAL P.05

. APR-24-2009 13:50 US ATTORt~E'{ DI ST OF t~r1 505 346 6887 P.02/05

0,--- n.

Wniteb ~tate~ 1lBistrirt QCourtFOR THE NEW MEXICO

--------- DISTRICT OF _

TO:

Custodian of RecordsNew Mexico State Investment Council41 Plaza La PrensaSanta Fe, NM 87507

SUBPOENA TO TESTIFYBEFORE GRAND JURY

SUBPOENA FPf:. 0 PERSON ~OCUMENTS OR OBJECT{S)

YOU ARE HEREBY COMMANDED to appear and testify before the Grand Jury of the United StatesDistrict Court at the place. date, and time specified below.

PLACE PETE V. DOMENICI UNITED STATES COURTHOUSE333 Lomas Blvd., NWAlbuquerque, New Mexico 87102

ROOMGrand Jury Room

DATE AND TIMEJune 9,2009

YOU ARE ALSO COMMANDED to bring with the following document(s) or object(s):*

SEe ATIACHMENT

':J PIOIJ88 888 IIddltlonsllnformlltlon on rev8rs~

This subpoena shall remain in effect until you are granted leave to depart by the court or by an officer acting:>n behalf of the cou rt.

DATE

April 24, 2009

ISteven C. Yarbrough, AUSAP.O. Box 607Albuquerque, New Mexico 87103(505) 346-7274

BY)DEPU~

Matthew J. Dykman. CLERK

:;LEAK

rhis subpoena is issued upon applica10n of the United States of America

GREGORY J. FOURATI. United States Attorney

If not applicable, entor "none"To 1M u5*d In lIov III A0110

FORM OBO·227

· APR-24-2003 13:50 505 346 6887 P.03/05

For the period 01/01/2003 to present, inclusive, the following docwnents, records, or items,regardless of storage format:

1) Contracts, or other agreements, between the New Mexico State Investment Council (SIC) andany firms, individuals, or entities investing funds or providing investment advice to or on behalfof the SIC.

2) Any documents listing the placement agents, brokers, or third party marketers associated with#1 above.

3) Contracts, or other agreements, between the SIC and Aldus Equity.

4) Correspondence, via e-mail or otherwise, between the SIC and Aldus Equity.

5) Correspondence, e-mails, documents or records relating to any placement agents or brokers.

6) Any documents or records generated by Aldus Equity which were provided to the SIC.

7) Requests for Proposals (RFPs) associated with #1 above.

8) A list of respondents to the RFPs in #7 above.

9) A list of firms selected by SIC staff to be interviewed by the SIC investment committeeassociated with #7 above.

10) A list of firms interviewed by the SIC investment committee.

11) Meeting minutes of meetings in which Aldus Equity was present.

12) Records of payments to Aldus to include instruments documenting payments.

13) A list of companies in which Aldus proposed that the SIC invest.

r'1A'(-16-200'3 11 : 54 P.02

US. Departlnent ofJustice


Custodian of RecordsNew Mexico State Investment Council41 Plaza La PrensaSanta Fe, New Mexico 87507


Dear Custodian of Records:

Post Office Box 607Albuquerque, New Mexico 87103

May 7, 2009

505/346-7274505/346-7224

FAX 505/346-7296

You have been served with a subpoena duces tecum issued by a federal grand jury incOImection with a criminal investigation being conducted in this district. That subpoena directsyou to produce documents before the grand jury in Albuquerque, New Mexico. Please call thegrand jury coordinator, Debra Barry, at (505) 346-7274 to confirm this date and time ofJune 9, 2009, at 8:30 a.m..

As a convenience to you, you may, if you wish, deliver the requested documents toSpecial Agent Leroy Chavez, Federal Bureau of Investigation, 4200 Luecking Park Avenue NE,Albuquerque, New Mexico 87107, (505) 889-1531, in lieu of personally appearing before thegrand jwy. Should you choose this option, please prepare the documents in some type of sealedpackage and mark on the package, in bright red letters if possible, "GRAND JURYMATERlALS, DO NOT OPEN," and turn them over to the agent who requested them in asealed condition.

If you have any questions, please feel free to contact Special Agent Leroy Chavez at 889-1531.

Sincerely,

GREGORY J. FOURATTUnited States Attorney

~~PAULA G. BURNETTAssistant United States Attorney

MRY-16-2009 11:54,

Wutteb ~tate511Bi5trict ~ourt

P.03

_______.....:F:....;O:..::R..:.,.T.::..;H:.::;E::.....- DISTRICT OF .:...::N~E~W:........:M~EXI~C:..:::O~ _

TO:



SUBPOENA FOR:o PERSON""¢ DOCUMENTS OR OBJECT(S)

YOU ARE HEREBY COMMANDED to appear and testify before the Grand Jury of the United StatesDistrict Court at the place, date, and time specified below.

PLACEPETE V. DOMENICIUnited States Courthouse333 Lomas NWAlbuquerque, New Mexico

ROOMGRAND JURY ROOM

DATE AND TIMEJune 9,2009 - 8:30 a.m.


See Attachment

o PJ88S8 888 tJddJtJonallnformatlon on r8V8f88

This subpoena shall remain in effect until you are granted leave to depart by the court or by an officer actingon behalf of the cou rt.

May 7, 2009

DATE

GREGORY J. FOURATT, UNITED STATES ATTORNE

Paula G. Burnett, AUSAPost Office Box 607Albuquerque, New Mexico505 346-7274

871030256809009

"If not applicable, enter "none"To blI uaod In lIou of A01 10

FORM 060·Z27

r'1f!'l-16-2009 11: 54

Records Requested

All e-mails, including attachments, to or from Gary Bland for the period January 1, 2003

through the present.

P.04

TOTAL P.04

U ITED STATES

SECURITIES AND EXCHANGE COMMISSIONDENVER REGIO AL OFFICE

1801 CALIFOR IA STREETSUITE 1500

DENVER, COLORADO 80202-2656

May 13,2009

In replyingplease quote

D-03035

VIA FEDEX and EMAIL ([email protected])

Bryan Agustin Otero, JD, LLMState Investment Office41 Plaza La PrensaSanta Fe, NM 87507

Re: In the Matter ofNew Mexico Public Investment Funds (D-03035)

Dear Mr. Otero:

The staff of the Securities and Exchange Commission ("Commission") is conducting aninformal investigation and requests that the New Mexico State Investment Council ("SIC")voluntarily produce the following documents:

1. All documents relating to the SIC's selection or retention of investment advisers,investment managers, investment funds, or investment vehicles for the periodJanuary 1, 2003 through the date of your response.

2. All documents relating to fees paid to finders, placement agents, marketers, orsimilar parties in connection with the activities described in Item 1.

Please make the above documents available for inspection on Tuesday, May 19,2009 inAlbuquerque, New Mexico at a place and time to be determined.

Please note that any information provided is subject to the Commission's routine uses. Alist of those uses is contained in the enclosed copy of SEC Form 1662, which also contains otherimportant information.

Please take all actions necessary to preserve all documents related to the mattersdescribed in this voluntary request and refrain from deleting or destroying any such documents,even if you might otherwise take such actions in the ordinary course of business.

This inquiry is non-public and should not be construed as an indication by theCommission or its staff that any violation of law has occurred or as a reflection upon any person,entity, or security.

If you have any questions, please call me at 303-844-1082. Thank you for yourcooperation.

Very truly yours,

Jeffrey R. Thomas

Enclosures: SEC Form 1662

2

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

DENVER REGIONAL OFFICE

1801 CALIFORNIA STREET

SUITE 1500DENVER, COLORADO 80202-2656

July 22, 2009


0-03035

VIAFEDEX

New Mexico State Investment Councilc/o Bryan Agustin Otero, JD, LLMNew Mexico State Investment Office41 Plaza La Prensa .Santa Fe, NM 87507


Dear Sirs or Madams:

The staffof the Securities and Exchange Commission is conducting an investigation inthe matter identified above. The enclosed subpoena has been issued to you as part of thisinvestigation. The subpoena requires you to give us documents.

Please read the subpoena and this letter carefully. This letter answers some questions youmay have about the subpoena. You should also read the enclosed SEC Form 1662. You mustcomply with the subpoena. You may be subject to a fine and/or imprisonment ifyou do not.

Producing Documents

What materials do I have to produce?

The subpoena requires youto give us the documents described in the attachment to thesubpoena. You Il,lust provide these documents by August 5, 2009. The attachment to thesubpoena defines some terms (such as "document") before listing what you must provide.

In addition, please note that the staffmay issue additional subpoenas to you in connectionwith this investigation. Accordingly, you mustpreserve all documents and other information,including electronically stored information, that may be relevant to this investigation.

Please note that if copies ofa document differ in any way, they are considered separatedocuments and you must send each one. For example. ifyou have two copies ofthe same letter,but only one of them has handwritten notes on it, you must send both the clean copy and the onewith notes.

Ifyou prefer, you may send us photocopies of the originals. The Commission cannotreimburse you for the copying costs. The copies must be identical to the originals, includingeven faint marks or print. Ifyou choose to send copies, you must keep the originals in a safe

place. The staff will accept the copies for now, but may require you to produce the originalslater.

Ifyou do send us photocopies, please put an identifying notation on each page of eachdocument to indicate that it was produced by you, and number the pages ofall the documentssubmitted. (For example, if Jane Doe sends documents to the staff, she may number the pagesJD-I, JD-2, JD-3, etc., in a blank comer of the documents.) Please make sure the notation andnumber do not conceal any writing or marking on the document. Ifyou send us originals, pleasedo not add any identifying notations.

The staff requests that all responsive documents, including hardcopy, electronic,and email documents, be produced in ali electronic format on CD or DVD. Document levelsearchable. text, all fielded data, and meta-data should be delivered in a Concordance®database accompanied by Bates numbered single-page Group IV TIFF images representingeach page of the production. An Opticon® image cross reference file should also beincluded in order to link the images to the database. Data deliveries should be separatedby custodian of the document and the database should identify the location from which the·document was obtained (e.g. shared server drive, individual local pc, network backup, etc.).You should also include an index briefly describing each item you send; and the databaseshould include a reference to the paragraph(s) in the subpoena attachment to which eachdocument responds.

The attached procedures: SEC-DRO Image and Data Delivery Standards provide ..the specifications for all data deliveries. Ifyou have any questions concerning the electronicproduction of documents, please contact the undersigned staff. We expect that a.conversation between our respective litigation/technical support managers will be the mostefficient method of assuring that any data production is in a format acceptable to thisoffice. Please contact me to arrange a mutually convenient time for such conference.

Do I need to send anything else?

You should enclose a list briefly describing each item you send. The list should statewhich paragraph(s) in the subpoena attachment each item responds to.

Please include a cover letter stating whether you believe you have met your obligationsunder the subpoena by searching carefully and thoroughly for everything called for by thesubpoena, and sending it all to us.

What ifI do not send everything described in the attachment to the subpoena?

The subpoena requires you to send all the materials described in it. If, for any reason -including a claim of attorney-client privilege -- you do not produce something called for by thesubpoena, you should submit a list ofwhat you are not producing. The list should describe eachitem separately, noting:

• its author(s);

• its date;

• its subject matter;

• the name ofthe person who has the item now, or the last person known to have it;

• the names ofeveryone who ever had the item or a copy of it, and the names ·ofeveryone who was told the item's contents; and

• the reason you did not produce the item.

If you withhold anything on the basis of a claim ofattorney-client privilege or attorney workproduct protection, you should also identify the attorney and client involved.

Where should Isend the materials?

Please send the materials to:

Jeffrey R. ThomasU.S. Securities and Exchange CommissionDenver Regional Office1801 California StreetSuite 1500Denver, CO 80202

Other Important Information

May I have a lawyer help me respond to the subpoena?

Yes. You have the right to consult with and be represented by your own lawyer in thismatter. Your lawyer may also advise and accompany you when you testify. We cannot give youlegal advice.

What will the Commission do with the materials I send and/or the testimony I provide?

The enclosed SEC Form 1662 includes a List of Routine Uses of information provided tothe Commission. This form has other important information for you. Please read it carefully.

Has the Commission determined that anyone has done anything wrong?

This investigation is a non-public, fact-fmding inquiry. We are trying to determinewhether there have been any violations of the federal securities laws. The investigation and thesubpoena do not mean that we have concluded that you or anyone else has broken the law. Also,the investigation does not mean that we have a negative opinion ofany person, entity or security.

Important Policy Concerning Settlements

Please note that, in any matter in which enforcement action is ultimately deemed to bewarranted, the Division of Enforcement will not recommend any settlement to the Commissionunless the party wishing to settle certifies, under penalty ofpeIjury, that all documents responsiveto Commission subpoenas and formal and informal document requests in this matter have beenproduced.

I have read this letter, the subpoena, and the SEC Form 1662, but I still have questions. Whatshould I do?

Ifyou have any other questions, you may call me at (303) 844-1082, Hugh C. Beck at(303) 844-1044, or Jeffrey E. Oraker at (303) 844-1097. If you are represented by a lawyer, youshould have your lawyer contact me.

Sincerely,

JJ!60:t-StaffAttorney - Enforcement

Enclosures: Subpoenahnage and Data Delivery StandardsSEC Form 1662

SUBPOENA

UNITED STATES OF AMERICASECURITIES AND EXCHANGE COMMISSION

In the Marter of New Mexico Public Investment Funds (D-03035)

To: New Mexico State Investment Council

~ YOU MUST PRODUCE everything specified in the Attachment to this subpoena to officers oftheSecurities and Exchange Connnission, at the place, date and time specified below:

Jeffrey R Thomas, Securities and Exchange Connnission, Denver Regional Office, 1801 California Street,Suite 1500, Denver, CO 80202, no later than August 5, 2009.

o YOU MUST TESTIFY before officers of the Securities and Exchange Connnission, at the place,date and time specified below:

By:

FEDERAL LAW REQUIRES YOU TO COMPLY WITH TIDS SUBPOENA.Failure to comply may subject you to a fme and/or imprisonment.

14,.i"-· Date: 712z ~ 0 'tJe~.Th s8ta ~ttorney - EnforcementSecurities and Exchange Commission1801 California, Suite 1500Denver, CO 80202

I am. an officer of the Securities and Exchange COlmnission authorized to issue subpoenas in this matter. TheSecurities and Exchange Commission has issued a formal order authorizing this investigation under Section 20(a) of theSecurities Act of 1933, Section 21(a) of the Securities Exchange Act of 1934, and Section 209(b) of the InvestmentAdvisers Act of 1940.

NOTICE TO WITNESS: Ifyou claim a witness fee or mileage, submit this subpoena with the claim voucher.

ATTACHMENT A

A. Definitions and Instructions

1. This subpoena calls for all documents in your possession, custody, or control, or subjectto your custody or control, including without limitation documents in the possession,custody, or control of your related parties.

2. The terms "SIC," "you," and "your" mean the New Mexico State Investment Council andits related parties.

3. The term "Aldus" means Aldus Equity Partners, L.P. and its related parties, including,without limitation Aldus Capital, LLC. .

4. The term ''related parties" should be interpreted as broadly as possible and includes,without limitation parent companies, subsidiaries, predecessors, successors, relatedentities, controlled entities, joint ventures, related trusts and trustees, related estates,affiliates, principals, officers, directors, associates, employees, agents, independentcontractors, attorneys in fact, and representatives.

5. The term "document" means all materials in your possession, custody, or control, orsubject to your custody or control, whether drafts or unfinished versions, originals ornonconforming copies thereof, however created, produced or stored (manually,mechanically, electronically or otherwise), and by whomever prepared, produced, sent,dated or received, including without limitation materials residing on computers, servers,network drives, personal digital assistants, CDs, DVDs, floppy discs, thumbdrives,cameras, backup or archive disks and tapes, and digital fax machines. The term"document" also includes, without limitation electronic mail or correspondence,metadata, embedded, hidden and other bibliographic or historical data describing orrelating to documents created, revised, or distributed on computer systems.

6. The term "communication" includes any trimsmittal or receipt of information, whether bychance or prearranged, formal or informal, oral, written or electronic, and includeswithout limitation: conversations, meetings and discussions in person; conversations,meetings and discussions by telephone; and written correspondence through the use of themails, courier services, electronic media (such as electronic mail, instant messaging, ortext messaging), and telephone lines and wires. The term "communication" also meansany docum~nt reflecting such communications.

7. A communication or document "concerning," "involving," "relating,""related," or"which relates" to any given subject should be interpreted as broadly as possible andmeans any communication or document that constitutes, contains, discusses, embodies,evidences, reflects, identifies, states, refers to, deals with, bears upon, or is in any waypertinent to that subject, including documents concerning the preparation ofotherdocuments.

8. The tenns "and" and "or" shall be construed either disjunctively or conjunctively asnecessary to bring within the scope of this request all documents that might otherwise beconstrued to be outside the scope.

9. The use of the singular fonn ofany word includes the plural and vice versa.

10. Should any document request require production of voluminous documents that aremaintained in electronic fonnat, the responsive documents should be produced in anelectronic format that is acceptable to this office.

11. Unless otherwise indicated, all requests relate to the period January 1, 2003 through thedate of your response.

B. Production

Please produce the following:

1. All organizational charts, and documents sufficient to identify the dates to which thosecharts apply.

2. All minutes ofmeetings of the SIC or any SIC committee or subcommittee, includingwithout limitation the Private Equity Advisory Investment Committee.

3. All investment-related requests for information ("RFIs") or requests for proposal("RFPs").

4. All responses to investment-related RFls or RFPs.

5. Documents sufficient to identify all investment funds, vehicles, or managers with whichyou communicated regarding any actual or potential investment by the SIC. In thealternative, you may provide a list containing this information.

6. All documents reflecting any communication with any investment fund, vehicle, ormanager identified in response to Item 5.

7. All documents reflecting any analysis or evaluation of any investment fund, vehicle, ormanager identified in response to Item 5, including without limitation analyses orevaluations ofresponses to RFIs or RFPs, regardless ofby whom the analysis orevaluation was prepared.

8. All documents relating to the SIC's selection qr retention ofAldus.

9. All materials provided or presented to the SIC by Aldus.

10. All documents relating to any actual or potential finder fee, placement agent fee,marketing fee, pr similar fee in connection with any investment by the SIC.

11. All documents reflecting any communication with or relating to any of the following:

a. Marc Correra or his related parties, including without limitation Ajax Investments,Crosscore Management, and SDN Advisers; .

b. Anthony Correra or his related parties; or

c. Any individual or entity that acted or has been identified as a third party marketer,placement agent, or finder in connection with any actual or potential investmentby the SIC.

12. Documents sufficient to identify all telephone numbers (including extensions) used by orassigned to Gary S. Bland. Such documents should identify, at a minimum, (a) telephonenumber, (b) type (e.g., landline or cell), (c) local carrier name, (d) long distance carriername, and (e) account opening/closing dates. In the alternative, you may provide a listcontaining this information.

13. Documents sufficient to identify all email or instant messaging addresses used by orassigned to Gary S. Bland. Such documents should identify, at a minimum, (a)email/messaging address, (b.) service provider name, and (c) account opening/closingdates. In the alternative, you may provide a list containing this information.

14. All electronic communications to or from Gary S. Bland.

15. All calendars, planners, daytimers, or similar items used by Gary S. Bland.

16. . All telephone or address lists, contact managers, rolodexes, or similar items used by GaryS. Bland.

UNITED STATE

SECUlITlES A:'I'D EXGIA:'I'GE CO:\l:\IISSI0:,\

DENVER REGia AL OFFICE

180 I CALIFOR IA STREET

SITE 1500DENVER, COLORADO 80202-2656

August 20, 2009


D-03035

VIA FEDEX

Gary S. Blandc/o ew Mexico State Investment Office41 Plaza La PrensaSanta Fe, 87507

Re: III the Matter ofNe,v Mexico Public III vestmell t FUllds (D-03035) ~

Dear Mr. Bland:

The staff of the Securities and Exchange Commission is conducting an investigation inthe matter identified above. The enclosed subpoena has been issued to you as part of thisinvestigation. The subpoena requires you to provide swom testimony.

Please read the subpoena and this letter carefully. This letter answers some questions youmay have about the subpoena. ¥ou should also read the enclosed SEC Form 1662. ¥ou mustcomply with the subpoena. You may be subject to a fine and/or imprisonment if you do not.

Testifving

Where and when do J testifjl?

The subpoena requires you to come to the Securities and Exchange ommission, DenverRegional Office, 1801 Califomia St., Suite 1500, Denver, CO 80202, on Wednesday,September 2, 2009 at 8:30 a.m. to testify under oath in the matter identified on the subpoena.

Background Questionnaire

To expedite your testimony, please complete the enclosed background questionnaire andretum it to me by fax (303-844-1052) or email (thomasjrc. sec.gov) by Monday, August 31,2009. Please also bring a copy of it to your testimony.

Other Important Information

May I have a law) er help me respond to the subpoena?

Yes. You have the right to consult with and be represented by your own lawyer in thismatter. Your lawyer may also advise and accompany you when you testify. We cannot give youlegal advice.

What will the Commission do with the materials J send and/or the testimony I provide?

The enclosed SEC Form 1662 includes a List of Routine Uses of information provided tothe Commission. This form has other important information for you. Please read it carefully.

Has the Commission determined that anyone has done anything wrong?

This investigation is a non-public, fact-finding inquiry. We are trying to determinewhether there have been any violations of the federal securities laws. The investigation and thesubpoena do not mean that we have concluded that you or anyone else has broken the law. Also,the investigation does not mean that we have a negative opinion of any person, entity or security.

Important Policy Concerning Selliements

Please note that, in any matter in which enforcement action is ultimately deemed to bewarranted, the Di ision of Enforcement will not recommend any settlement to the Commissionunless the patty wishing to settle certifies, under penalty of petjury, that all documents responsiveto Commission subpoenas and formal and informal document requests in this matter have beenproduced.

J have read this leller, the subpoena. and the SEC Form 1662, but I still have questions. Whatshould J do?

If you have any other questions, you may call me at (303) 844-1082, Hugh C. Beck at(303) 844-1044, or Jeffrey E. Oraker at (303) 844-1097. If you are represented by a lawyer, youshould have your lawyer contact me.

Sincerely,

Iff£-Jeffrey R. homasStaff Attorney - Enforcement

Enclosures: SubpoenaBackground QuestionnaireSEC Fonn 1662

SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

Supplemental Jnformation for Persons Requested to SupplyInformation Voluntaril or Directed to Supply Information

Pursuant to a Commission Subpoena

False Statements and Documents

Section 1001 of Title 18 of the United States Code provides as follows:

Whoever, in any matter within the jurisdiction of any department or agency of the United States knowingly andwillfully falsifies, conceals or covers up by any trick, scheme, or device a material fact, or makes any false,fictitious or fraudulent statements or representations, or makes or uses any false writing or document knowingthe same to contain any false, fictitious or fraudulent statement or entry, shall be fined under this title orimprisoned not more than five years, or both.

Testimony

If your tlilstimony is taken, you should be aware of the following:

1. Record. Your testimony will be transcribed by a reporter. If you desire to go off the record, please indicate this to theCommission employee taking your testimony, who will determine whether to grant your request. The reporter will not go offthe record at your, or your counsel's, direction.

2. Counsel. You have the right to be accompanied, represented and advised by counsel of your choice. Your counsel mayadvise you before, during and after your testimony; question you briefly at the conclusion of your testimony to clarify any ofthe answers you give during testimony; and make summary notes during your testimony solely for your use. If you areaccompanied by counsel, you may consult privately.

If you are not accompanied by counsel, please advise the Commission employee taking your testimony whenever during yourtestimony you desire to be accompanied, represented and advised by counsel. Your testimony will be adjourned to affordyou the opportunity to arrange to do so.

You may be represented by counsel who also represents other persons involved in the Commission's investigation. Thismultiple representation, however, presents a potential conflict of interest if one client's interests are or may be adverse toanother's. If you are represented by counsel who also represents other persons involved in the investigation, the Commissionwill assume that you and counsel have discussed and resolved all issues concerning possible conflicts of interest. The choiceof counsel, and the responsibility for that choice, is yours.

3. Transcript Availability. Rule 6 of the Commission's Rules Relating to Investigations, 17 CFR 203.6, states:----:--------'

A person who has submitted documentary evidence or testimony in a formal investigative proceeding shall beentitled, LWOD written re~st, to procure a copy of his documentary evidence or a transcript of his testimony onpayment of the appropriate fees: Provided, however, That in a nonpublic formal investigative proceeding theCommission may for good cause deny such request. In any event, any witness, upon proper identification, shall haveV ~

the right to inspect the official transcript of the witness' own testimony.

~f you wish to purchase a copy of the transcript of your testimony, the reporter will provide you with a copy of the appropriate/ form. Persons requested to supply information voluntarily will be allowed the rights provided by this rule.

4. Perjury. Section 1621 of Title 18 of the United States Code provides as follows:

Whoever ... having taken an oath before a competent tribunal, officer, or person, in any case in which a law of theUnited States authorizes an oath to be administered, that he will testify, declare, depose, or certify truly willfullyand contrary to such oath states or subscribes any material matter which he does not believe to be true is guiltyof perjury and shall, except as otherwise expressly provided by law, be fined under this title or imprisoned not morethan five years or both ....

SEC 1662 (5-04)

5. Fifth Amendment and Voluntary Testimony. Information you give may be used against you in any federal, state, local orforeign administrative, civil or criminal proceeding brought by the Commission or any other agency.

You may refuse, in accordance with the rights guaranteed to you by the Fifth Amendment to the Constitution of the UnitedStates, to give any information that may tend to incriminate you or subject you to fine, penalty or forfeiture.

V If your testimony is not pursuant to subpoena, your appearance to testify is voluntary, you need not answer any question, and/you may leave whenever you wish. Your cooperation is, however, appreciated.

-L 6. Formal Order Availability. If the Commission has issued a formal order of investigation, it will be shown to you during your/ - testimony, at your request. If you desire a copy of the formal order, please make your request in writing.

Submissions and Settlements

Rule 5(c) of the Commission's Rules on Informal and Other Procedures, 17 CFR 202.5(c), states:

Persons who become involved in ... investigations may, on their own initiative, submit a written statement to theCommission setting forth their interests and position in regard to the subject matter of the investigation. Uponrequest, the staff, in its discretion, may advise such persons of the general nature of the investigation, including theindicated violations as they pertain to them, and the amount of time that may be available for preparing andsubmitting a statement prior to the presentation of a staff recommendation to the Commission for the commencementof an administrative or injunction proceeding. Submissions by interested persons should be forwarded to theappropriate Division Director, Regional Director, or District Administrator with a copy to the staff membersconducting the investigation and should be clearly referenced to the specific investigation to which they relate. Inthe event a recommendation for the commencement of an enforcement proceeding is presented by the staff, anysubmissions by interested persons will be forwarded to the Commission in conjunction with the staff memorandum.

The staff of the Commission routinely seeks to introduce submissions made pursuant to Rule 5(c) as evidence in Commissionenforcement proceedings, when the staff deems appropriate.

Rule 5(f) of the Commission's Rules on Informal and Other Procedures, 17 CFR 202.5(f), states:

In the course of the Commission's investigations, civil lawsuits, and administrative proceedings, the staff, withappropriate authorization, may discuss with persons involved the disposition of such matters by consent, bysettlement, or in some other manner. It is the policy of the Commission, however, that the disposition of any suchmatter may not, expressly or impliedly, extend to any criminal charges that have been, or may be, brought againstany such person or any recommendation with respect thereto. Accordingly, any person involved in an enforcementmatter before the Commission who consents, or agrees to consent, to any judgment or order does so solely for thepurpose of resolving the claims against him in that investigative, civil, or administrative matterand notforthe purposeof resolving any criminal charges that have been, or might be, brought against him. This policy reflects the fact thatneither the Commission nor its staff has tile authority or responsibility for instituting, conducting, settling, or otherwisedisposing of criminal proceedings. That authority and responsibility are vested in the Attorney General andrepresentatives of the Department of Justice.

Freedom of Information Act

The Freedom of Information Act, 5 U.S.C. 552 (the "FOIA"), generally provides for disclosure of information to the public. Rule83 of the Commission's Rules on Information and Requests, 17 CFR 200.83, provides a procedure by which a person can makea written request that information submitted to the Commission not be disclosed under the FOIA. That rule states that nodetermination as to the validity of such a request will be made until a request for disclosure of the information under the FOIAis received. Accordingly, no response to a request that information not be disclosed under the FOIA is necessary or will begiven until a request for disclosure under the FOIA is received. If you desire an acknowledgment of receipt of your written requestthat information not be disclosed under the FOIA, please provide a duplicate request, together with a stamped, self-addressedenvelope.

Authority for Solicitation of Information

Persons Directed to Supply Information Pursuant to Subpoena. The authority for requiring production of information is set forthin the subpoena. Disclosure of the information to the Commission is mandatory, SUbject to the valid assertion of any legal rightor privilege you might have.

Persons Requested to Supply Information Voluntarily. One or more of the following provisions authorizes the Commission tosolicit the information requested: Sections 19 and/or 20 of the SeCUrities Act of 1933; Section 21 of the Securities ExchangeAct of 1934; Section 321 of the Trust Indenture Act of 1939; Section 42 of the Investment Company Act of 1940; Section 209

of the Investment Advisers Act of 1940; and 17 CFR 202.5. Disclosure of the requested information to the Commission isvoluntary on your part.

Effect of Not Supplying Information

Persons Directed to Supply Information Pursuant to Subpoena. If you fail to comply with the subpoena, the Commission mayseek a court order requiring you to do so. If such an order is obtained and you thereafter fail to supply the information, youmay be subject to civil and/or criminal sanctions for contempt of court. In addition, if the subpoena was issued pursuant tothe Securities Exchange Act of 1934, the Investment Company Act of 1940, and/or the Investment Advisers Act of 1940, andif you, without just cause, fail or refuse to attend and testify, or to answer any lawful inquiry, or to produce books, papers,correspondence, memoranda, and other records in compliance with the subpoena, you may be found guilty of a misdemeanorand fined not more than $1 ,000 or imprisoned for a term of not more than one year, or both.

Persons Requested to Supply Information Voluntarily. There are no direct sanctions and thus no direct effects for failing to provideall or any part of the requested information.

Principal Uses of Information

The Commission's principal purpose in soliciting the information is to gather facts in order to determine whetller any personhas violated, is violating, or is about to violate any provision of the federal securities laws or rules for which the Commissionhas enforcement authority, such as rules of securities exchanges and the rules of the Municipal Securities Rulemaking Board.Facts developed may, however, constitute violations of other laws or rules. Information provided may be used in Commissionand other agency enforcement proceedings. Unless the Commission or its staff explicitly agrees to the contrary in writing, youshould not assume that the Commission or its staff acquiesces in, accedes to, or concurs or agrees with, any position,condition, request, reservation of right, understanding, or any other statement that purports, or may be deemed, to be or toreflect a limitation upon the Commission's receipt, use, disposition, transfer, or retention, in accordance with applicable law,of information provided.

Routine Uses of Information

The Commission often makes its files available to other governmental agencies, particularly United States Attorneys and stateprosecutors. There is a likelihood that information supplied by you will be made available to such agencies where appropriate.Whether or not the Commission makes its files available to other governmental agencies is, in general, a confidential matterbetween the Commission and such other governmental agencies.

Set forth below is a list of the routine uses which may be made of the information furnished.

1. To coordinate law enforcement activities between the SEC and otherfederal, state, local or foreign law enforcement agencies,securities self-regulatory organizations, and foreign securities authorities.

2. By SEC personnel for purposes of investigating possible violations of, or to conduct investigations authorized by, the federalsecurities laws.

3. Where there is an indication of a violation or potential violation of law, whether civil, criminal or regulatory in nature, andwhether arising by general statute or particular program statute, or by regulation, rule or order issued pursuant thereto, therelevant records in the system of records may be referred to the appropriate agency, whether federal, state, or local, a foreigngovernmental authority orforeign securities authority, or asecurities self-regulatory organization charged with the responsibilityof investigating or prosecuting such violation or charged with enforcing or implementing the statute or rule, regulation or orderissued pursuant thereto.

4. In any proceeding where the federal securities laws are in issue or in which the Commission, or past or present membersof its staff, is a party or otherwise involved in an official capacity.

5. To a federal, state, local or foreign governmental awthority or foreign securities authority maintaining civil, criminal or otherrelevant enforcement information or other pertinent information, such as current licenses, if necessary to obtain informationrelevant to an agency decision concerning the hiring or retention of an employee, the issuance of a security clearance, theletting of a contract, or the issuance of a license, grant or other benefit.

6. To a federal, state, local or foreign governmental authority or foreign securities authority, in response to its request, inconnection with the hiring or retention of an employee, the issuance of a security clearance, the reporting of an investigationof an employee, the letting of a contract, or the issuance of a license, grant or other benefit by the requesting agency, to theextent that the information is relevant and necessary to the requesting agency's decision on the matter.

7. In connection with proceedings by the Commission pursuant to Rule 102(e) of its Rules of Practice, 17 CFR 201.1 02(e).

3

8. When considered appropriate, records in this system may be disclosed to a bar association, the American Institute ofCertified Public Accountants, a state accountancy board or other federal, state, local or foreign licensing or oversight authority,foreign securities authority, or professional association or self-regulatory authority performing similar functions, for possibledisciplinary or other action.

9. In connection with investigations or disciplinary proceedings by a state securities regulatory authority, a foreign securitiesauthority, or by a self-regulatory organization involving one or more of its members.

10. As a data source for management information for production of summary descriptive statistics and analytical studies insupport of the function for which the records are collected and maintained or for related personnel management functions ormanpower studies, and to respond to general requests for statistical information (without personal identification of individuals)under the Freedom of Information Act or to locate specific individuals for personnel research or other personnel managementfunctions.

11. In connection with their regulatory and enforcement responsibilities mandated by the federal securities laws (as definedin Section 3(a)(47) of the Securities Exchange Act of 1934,15 U.S.C. 78c(a)(47)), or state orforeign laws regulating securitiesor other related mat1ers, records may be disclosed to national securities associations that are registered with the Commission,the Municipal Securities Rulemaking Board, the Securities Investor Protection Corporation, the federal banking authorities,including but not limited to, the Board of Governors of the Federal Reserve System, the Comptroller of the Currency, and theFederal Deposit Insurance Corporation, state securities regulatory or law enforcement agencies or organizations, or regulatorylaw enforcement agencies of a foreign government, or foreign securities authority.

12. To any trustee, receiver, master, special counsel, or other individual or entity that is appointed by a court of competentjurisdiction or as a result of an agreement between the parties in connection with litigation or administrative proceedingsinvolving allegations of violations of the federal securities laws (as defined in Section 3(a) (47) of the Securities Exchange Actof 1934,15 U.S.C. 78c(a)(47)) orthe Commission's Rules of Practice, 17 CFR 202.1 00 -900, or otherwise, where such trustee,receiver, master, special counselor other individual or entity is specifically designated to perform particular functions withrespect to, or as a result of, the pending action or proceeding or in connection with the administration and enforcement bythe Commission of the federal securities laws or the Commission's Rules of Practice.

13. To any persons during the course of any inquiry or investigation conducted by the Commission's staff, or in connectionwith civil litigation, if the staff has reason to believe that the person to whom the record is disclosed may have further informationabout the mat1ers related therein, and those matters appeared to be relevant at the time to the subject matter of the inquiry.

14. To any person with whom the Commission contracts to reproduce, by typing, photocopy or other means, any record withinthis system for use by the Commission and its staff in connection with their official duties or to any person who is utilized bythe Commission to perform clerical or stenographic functions relating to the official business of the Commission.

15. Inclusion in reports published by the Commission pursuant to authority granted in the federal securities laws (as definedin Section 3(a)(47) of the Securities Exchange Act of 1934,15 U.S.C. 78c(a)(47)).

16. To members of advisory committees that are created by the Commission or by the Congress to render advice andrecommendations to the Commission or to the Congress, to be used solely in connection with their official designatedfunctions.

17. To any person who is or has agreed to be subject to the Commission's Rules of Conduct, 17 CFR 200.735-1 to 735-18,and who assists in the investigation by the Commission of possible violations of federal securities laws (as defined in Section3(a)(47) of the Securities Exchange Act of 1934,15 U.S.C. 78c(a)(47)), in the preparation or conduct of enforcement actionsbrought by the Commission for such violations, or otherwise in connection with the Commission's enforcement or regulatoryfunctions under the federal securities laws.

18. Disclosure may be made to a Congressional office from the record of an individual in response to an inquiry from theCongressional office made at the request of that individual.

19. To respond to inquiries from Members of Congress, the press and the public which relate to specific matters that theCommission has investigated and to matters under the Commission's jurisdiction.

20. To prepare and publish information relating to violations of the federal securities laws as provided in 15 U.S.C. 78c(a)(47)),as amended.

21. To respond to sUbpoenas in any litigation or other proceeding.

22. To a trustee in bankruptcy.

4

23. To any governmental agency, governmental or private collection agent, consumer reporting agency or commercialreporting agency, governmental or private employer of a debtor, or any other person, for collection, including collectionby administrative offset, federal salary offset, tax refund offset, or administrative wage garnishment, of amounts owed asa result of Commission civil or administrative proceedings.

Small Business Owners: The SEC always welcomes comments on how it can better assist small businesses. If you havecomments about the SEC's enforcement of the securities laws, please contact the Office of Chief Counsel in the SEC's Divisionof Enforcement at 202-942-4530 or the SEC's Small Business Ombudsman at 202-942-2950. If you would prefer to commentto someone outside of the SEC, you can contact the Small Business Regulatory Enforcement Ombudsman at http://www.sba.gov/ombudsmanortollfreeat888-REG-FAIR. The Ombudsman's office receives comments from small businessesand annually evaluates federal agency enforcement activities for their responsiveness to the special needs of small business.

5

UNITED STATES

SECURITIES AND EXCHANGE COMMISSIONDENVER REGIONAL OFFICE

1801 CALIFORNIA STREETSUITE 1500

DENVER, COLORADO 80202-2656

November 25,2009


D-03035

VIA EMAIL ([email protected])

Keith MillerPartnerPaul, Hastings, Janofsky & Walker LLP75 East 55th StreetNew York; NY 10022


Dear Keith:

As we discussed, the Commission staff requests that each person serving as a member ofthe State fuvestment Council ("SIC") since January 1,2003 (each "Council member") producethe following documents for the period January 1,2003 to the present:

1. All documents containing notes made by the Council member regarding actual orpotential investments by the SIC.

2. All documents reflecting communications regarding actual or potential investments bythe SIC, excluding communications from SIC staff. Such documents should include, butnot be limited to, communications with: .

a. Governor Bill Richardson or his staff;b. Other Council members;c. Aldus Equity Partners; andd. Managers of funds in which the SIC invested.

3. All documents relating to Marc Correra, Anthony Correra, Cabrera Capital, AjaxInvestments, Crosscore Management, L2 Capital, SDN Advisors, or Sandia AssetManagement.

4. Documents sufficient to identify (or, in the alternative, a list of) the Council member'sinvolvement; positions, responsibilities, if any, whether official or unofficial, inconnection with any campaign, political action committee, foundation, or organizationsupporting or associated with Bill Richardson, including without limitation:

a. Moving America Forward Foundation,

b. 'Moving America Forward political action committee,

c. New Mexicans for Bill Richardson,

d. Richardson for Governor,

e. Si Se Puede,

f. Bill Richardson for President Exploratory Committee Inc., or

g. Richardson for President Inc.

5. Documents sufficient to identify (or, in the alternative, a list of) any monetary donationsby the Council member, members of the Council member's immediate family, or entitiesthat the Council member controlled to any campaign, political action committee,foundation, or organization supporting or associated with Bill Richardson, includingwithout limitation, those listed in item 4.

The staff requests that each Council member produce these documents by Wednesday,December 9, 2009. The staff also requests that each Council member include with hislherproduction a completed Certification as to Completeness ofDocument Production in the attachedform. Finally, the staff requests that each Council member take all actions necessary to preserveall documents related to the matters described in this voluntary request and refrain from deletingor destroying any such documents, even if the Council member might otherwise take suchactions in the ordinary course ofbusiness.

Please note that any information provided is subject to the Commission's routine uses. Alist ofthose uses is contained in the enclosed copy of SEC Form 1662, which also contains otherimportant information. This inquiry is non-public and should not be construed as an indicationby the Commission or its staff that any violation of law has occurred or as a reflection upon anyperson, entity, or security.

Ifyou have any questions, please call me at 303-844-1082.

Very truly yours,

~1{LJeffrey R. Thomas

Enclosures: Certification as to Completeness ofDocument ProductionSEC Form 1662

2

CERTIFICATION AS TO COMPLETENESSOF DOCUMENT PRODUCTION

________ hereby certifies as follows:

1. I have made a diligent search of all files in my possession, custody, or control that

are reasonably likely to contain documents responsive to the Commission's document request

dated __, including but not limited to general file areas, off-site document files, e-mail and

archive files, and all other original and back-up electronic and computer files and systems.

2. To the best of my knowledge, all responsive documents in my possession,

custody, or control have been produced to the Commission or identified in a privilege log

submitted to the Commission. I have a good faith basis to believe that a bona fide privilege,

recognized under applicable law, applies to each responsive document identified on a privilege

log and not produced to the Commission.

I declare under penalty ofperjury that the foregoing is true and correct.

Executed on _

3

us. Department ofJustice





Post Office Box 607Albuquerque, New Mexico 87103

May 12,2010

505/346-7274505/346-7224

FAX 505/346-7296

You have been served with a subpoena duces tecum issued by a federal grand jury inconnection with a criminal investigation being conducted in this district. That subpoena directsyou to produce documents before the grand jury in Albuquerque, New Mexico. Please call thegrand jury coordinator, Lupe Reyes-Maes, at (505) 346-7274 to confirm this date and timeof June 8, 2010, at 8:30 a.m.

As a convenience to you, you may, if you wish, deliver the requested documents toSpecial Agent Leroy Chavez, Federal Bureau ofInvestigation, 4200 Luecking Park Avenue NE,Albuquerque, New Mexico 87107, (505) 889-1531, in lieu of personally appearing before thegrand jury. Should you choose this option, please prepare the documents in some type of sealedpackage and mark on the package, in bright red letters if possible, "GRAND JURYMATERIALS, DO NOT OPEN," and turn them over to the agent who requested them in asealed condition.


Sincerely,

KENNETHlGONZALESUnited States Attorney


muitett ~tates 1lBistrict <!Court

_______-=-F..;;;,O,:.:R;,..;:T;.:.H:::E:...- DISTRICT OF ...=.N~E~W~M~E~X~I.:::::.CO~ _

TO:



SUBPOENA FOR:

D PERSON ~ DOCUMENTS OR OBJECT(S)


PLACEPETE V. DOMENICIUnited States Courthouse333 LomasNWAlbuquerque, New Mexico

ROOM

DATE AND TIME

GRAND JURy ROOM

June 8, 2010 - 8:30 a.m.


See Attachment

o Please see additional information on reverse

871030256809211

DATE

Paula G. Burnett, AUSAPost Office Box 607Albuquerque, New Mexico505 346-7274

May 12,2010

This subpoena shall remain in effect until you are granted leava to depart by the court or by an officer actingon behalf of the court. .oes.:jj~o:::.o..''J!P'ft1ftj;oooo::ooo:::o:::o::::f.$

KENNETH J. GONZALES, UNITED STATES ATTORN Y

This subpoena is issution of the United State

*If not applicable, enter "none"To be used in lieu 01 A011 0

FORM 060-227Revised April 2000

Records Requested

All e-mails, including attachments, to or from Gary Bland for the period January 1, 2003through May 7, 2009.

us. Department ofJustice


Custodian of RecordsNew Mexico State Investment Council41 Plaza La PrensaSanta Fe ew Mexico 87507



Post Office Box 607Albuquerque. New Mexico 87103

May 12,2010

505/346-7274505/346-7224

FAX 505/346-7296

You have been served with a subpoena duces tecum issued by a federal grand jury inconnection with a criminal investigation being conducted in this district. That subpoena directsyou to produce documents before the grand jury in Albuquerque, New Mexico. Please call thegrand jury coordinator, Lupe Reye -Maes, at (505) 346-7274 to confirm this date and timeof June 8, 2010, at 8:30 a.m.

As a convenience to you, you may, if you wish, deliver the requested documents topecial Agent Leroy Chavez, Federal Bureau ofInvestigation, 4200 Luecking Park Avenue E,

Albuquerque, ew Mexico 87107, (505) 889-1531, in lieu of personally appearing before thegrand jury. Should you choose this option, please prepare the documents in some type of sealedpackage and mark on the package, in bright red letters if possible, "GRAND JURYMATERIALS, DO NOT OPEN," and turn them over to the agent who requested them in asealed condition.


Sincerely,

KENNETHJ.GONZALES


Wniteb ~tates Ilistritt «ourt

_______---::F....;;O;.=.R::....T:....:HE=- DISTRICT OF ~=:.EW~ME~Xl~C~O:.....----

TO:

Custodian of Recordsew Mexico State Investment Council

41 Plaza La PrensaSanta Fe, New Mexico 87507

SUBPOENA TO TESTIFYBEFORE GRAND JURy

SUBPOENA FOR::J PERSON ~ DOCUMENTS OR OBJECT(S)


DATE AND TIMEJune 8, 2010 - 8:30 a.m.

PLACEPETE V. DOMENICIUnited States Courthouse333 Lomas [W

Albuquerque, ew Mexico

ROOMGRAND JURy ROOM


See Attachment

o Please see additional Information on reverse

May 12 2010

DATE

Pawa G. Burnett, AUSAPost Office Box 607Albuquerque, New Mexico 87103505 346-7274 0256809212

KENNETHJ. GONZALES, UNITED STATES ATTO

CLERK

This subpoena shall remain in effect until you are granted leave to depart by the court or by an officer actingon behalf of the court. \.es.......

~~ ..".>.."'.:..

.0""".C \'.~."';;:'.

"If not applicable, enter "none" To be used In lieu of AOll 0FORM OBO·227Revised April 2000

For the period 01/0112003 through 04/24/2009, inclusive, the following documents, records, oritems, regardless of storage fonnat:

1) Contracts, or other agreements, between the ew Mexico State Investment Council (SIC) andany finns, individuals, or entities investing funds or providing investment advice to or on behalfof the SIC.

2) Any documents listing the placement agents, brokers, or third party marketers associated with#1 above.

3) Contracts, or other agreements, between the SIC and Aldus Equity.

4) Correspondence, via e-mail or otherwise, between the SIC and Aldus Equity.

5) Correspondence, e-mails, documents or records relating to any placement agents or brokers.

6) Any documents or records generated by Aldus Equity which were 'provided to the SIC.

7) Requests for Proposals (RFPs) associated with #1 above.

8) A list of respondents to the RFPs in #7 above.

9) A list offmns selected by SIC staff to be interviewed by the SIC investment committeeassociated with #7 above.

10) A list of firms interviewed by the SIC investment committee.

11) Meeting minutes of meetings in which Aldus Equity was present.

12) Records of payments to Aldus to include instruments documenting payments.

13) A list of companies in which Aldus proposed that the SIC invest.

EXHIBIT E

EXHIBIT F

NEW MEXICO STATE INVESTMENT COUNCIL SUBCOMMITTEE

Commissioner Pat Lyons Public Member Andrew Davis Public Member Steve Feinberg Public Member Peter Frank

February 21, 2010

New Mexico State Investment Council:

Status Report & Recommendations of the Subcommittee The State Investment Council (SIC) created a “Subcommittee” at its August 2009 meeting charging it with a number of tasks. The Subcommittee has been active and believes it appropriate to report from time to time to the full SIC on its workings and recommendations. REPORT of ACTIVITIES - SIC SUBCOMMITTEE The SIC is a non-cabinet level agency charged with managing the state’s permanent trust funds. The SIC is chaired by Governor Bill Richardson and composed of nine members, including four public members appointed by the Governor for up to five year terms. This section of the letter summarizes activities of the current Subcommittee since formation. Formation

• In June 2009, Peter Frank, a SIC public member, suggested forming an SIC Subcommittee to deal with matters of governance, audits, the SIC agenda, and performance reporting methodology with the intention of making reports more transparent and user-friendly.

• Formation of the Subcommittee was approved at the SIC meeting of August 25, 2009 and the acting Chair asked SIC public members Stephen Feinberg, Andrew Davis, and Peter Frank, and State Land Commissioner, Patrick Lyons to constitute the Subcommittee.

• The Subcommittee held its first meeting on September 9, 2009 and has met frequently thereafter to discuss governance issues; to consider SIC agendas; to meet with various SIO (“SIO” means the office, staff and Officer) personnel to increase understanding of day-to-day office procedures, portfolio management, and performance reporting; and to act as the SIC “Audit Committee”.

Increased Activity and Oversight

• Subsequent to September 2009, the Subcommittee became more active as a result of “pay-to-play” issues which surfaced in conjunction with New York State Attorney General Andrew Cuomo’s investigation of Aldus Equity, a consultant to New York and also to New Mexico for five years for private equity investments.

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• The State Investment Officer (SIO) immediately suspended Aldus Equity. Shortly thereafter Attorney General Cuomo indicted Saul Meyer, head of Aldus Equity. A press release announced his guilty plea in New York and included this statement:

“From in or about 2004 through in or about February 2009, Aldus also acted as an advisor to the New Mexico State Investment Council and the New Mexico Educational Retirement Board in the State of New Mexico. In that capacity, I [Saul Meyer] had a fiduciary duty to act exclusively in the best interests of the State of New Mexico. On numerous occasions, however, contrary to my fiduciary duty, I ensured that Aldus recommended certain proposed investments that were pushed on me by politically-connected individuals in New Mexico. I did this knowing that these politically-connected individuals or their associates stood to benefit financially or politically from the investments and that the investments were not necessarily in the best economic interest of New Mexico.” (see Oct 6, 2009: http://newmexicoindependent.com/38584/governors-office-richardson-never-had-contact-with-saul-meyer)

• The State Investment Office had employed the law firm of Paul, Hastings,

Janofsky & Walker to assist in responding to subpoenas from Federal agencies. Their role was expanded to include an internal investigation into the various “pay-to-play” issues; for legal and conflict reasons, oversight of that expanded investigation was undertaken by the Subcommittee.

• The Subcommittee began in October to provide direction to Paul, Hastings concerning scope, actions, reports and findings from their ongoing investigation. This role included discussions of their findings with respect to individuals in the SIO who had responsibility for investment decision-making. The Paul, Hastings law firm also interviewed senior SIO employees, including Gary Bland (who resigned October 21, 2009), and reported findings to the Subcommittee. The Subcommittee met frequently with Paul, Hastings to discuss how to move forward on various issues the attorneys had discovered. The Subcommittee continues to meet frequent with Paul, Hastings as the Firm concludes its investigation.

o The Subcommittee is aware of the Legislature’s concerns that this process has been costly, albeit necessary as the SIO is responsible for oversight of more than $13 billion in state assets;

o The Subcommittee has tried to balance the need for sufficient information, so all constituencies are assured the necessary due diligence and information-gathering have been conducted in order to move forward, with a sensitivity to keeping legal costs as low as possible;

o The Subcommittee, while not involved in the employment of Paul, Hastings or its initial work successfully and recently negotiated future fees of the Paul, Hastings firm to an acceptable level; their services soon will conclude with a brief report of their processes and their suggestions for potential avenues of financial recovery.

Other activities

• The Subcommittee met with the SIO’s independent auditors to discuss scope of and findings from the 2009 audit (FY09 ended in June 09). The Subcommittee will act as an “audit committee”, continuing to deal with the independent auditors.

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http://newmexicoindependent.com/38584/governors-office-richardson-never-had-contact-with-saul-meyer

http://newmexicoindependent.com/38584/governors-office-richardson-never-had-contact-with-saul-meyer

• The Subcommittee worked to assist Bob Jacksha when he was appointed interim State Investment Officer after Gary Bland resigned.

• Three public SIC members, with Katherine Miller, Secretary-Department of Finance & Administration, serve on a search committee appointed by the Governor to identify a permanent State Investment Officer. Mr. Douglas Brown, Dean, University of New Mexico, Anderson School of Management, chairs this committee. The committee has met numerous times to plan the search, to issue an ITB and review resulting proposals from prospective search firms, narrowing candidates to two finalists. In March, the search committee will meet in Albuquerque to interview two search firm finalists.

• As outlined in this report, the SIC Subcommittee has been active in many areas of oversight of the State Investment Office during this critical period.

RECOMMENDATIONS FOR THE SIC AGENDA The SIC delegated to the Subcommittee the establishment, in consultation with the SIO, of agenda for meetings of the SIC. In order to set direction, the Subcommittee on behalf of the SIC lays out below a set of priorities for the Office and the SIC. Members of the SIC should add to or emend these priorities. The Subcommittee has spoken on various occasions with Bob Jacksha about many of these priorities; he has been helpful in evolving the thinking. These recommendations are not intended as a critique of the Council or current management, but as a vehicle to get into place a set of goals and priorities for the SIC as it evolves to a more active role. Investment returns

• We believe that the utmost priority for the SIC is to invest the monies entrusted to it in a way that works to assure performance objectives are met. Long term performance is below benchmarks in many cases and, importantly, below peer group comparatives; the SIC needs to undertake actions that are devised to improve these outcomes and bring performance to at least a respectable comparison to peer groups. We understand that under Bob Jacksha a number of important steps have commenced at his initiative, and our urging, and we expect to receive updates on this program at the next SIC meeting. As an example of one approach (which already may be underway) managers should be ranked in terms of size and performance (long term as well as the last 1 to 3 years). An additional factor to include in the screens should be whether the initial investment involved a third party marketer (e.g. one that has been on the list of questionable entities, such as Aldus or Correra). Working from top to bottom, the sizable positions with the lowest performance should be reevaluated for potential replacement. This program should proceed in an orderly fashion through all managers, using to the extent possible outside advisors contracted to the SIO. We would expect that both internally and externally managed assets be incorporated in this reevaluation and that changes and consolidation of managers and positions will result;

Portfolio Goals

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• We believe the most important subject that the SIC should discuss and debate soon are the goals for the portfolio. Agreement on goals will have a large impact in guiding the Search Committee in its selection of the type of permanent State Investment Officer to be hired. Given the pecuniary constraints (budget and otherwise) that the SIC and SIO face, agreement on Goals becomes even more paramount. For example, the SIO and SIC should consider whether the existing approach of managing investments is the most appropriate approach for the State in terms of both performance and cost. Currently, the SIO actively manages the portfolio by, for example, direct selections of large cap securities, running its own index funds and by selecting a plethora of managers for a variety of classifications and styles. An alternative model used by the ERB essentially outsources the investment decisions to one or a few select broad-based managers;

Leadership • As important is the creation of a stable Office under full-time permanent

leadership. A permanent State Investment Officer needs to be employed in order to undertake all the priorities we outline;

Investigations • An important priority, not entirely within the control of the SIC, is to complete as

quickly as possible the on-going governmental investigations prompted by the alleged “pay-to-play” issues surrounding the office. In addition, major related litigation involving the State and the SIC needs to be handled expeditiously and in a way that least interrupts the on-going business of the SIO;

• We recommend that the New Mexico Attorney General immediate begin a

process to evaluate bringing suit for recovery of losses and damages caused by the potentially improper conduct of investment managers, third party marketers and any other parties who had a role in the “pay-to-play” activities in the past few years. We believe that recovery of significant dollars lost is possible;

Ennis Knupp Report and Risk Management

• The report recently issued by Ennis Knupp presented 82 recommendations for changes and improvements. The Subcommittee believes that nearly all the recommendations are sound and should be implemented as quickly as possible. The SIO needs to establish an internal task-force to evaluate each recommendation and report to the SIC on its plan for implementation as written or in a form revised by the SIO, providing a justification for amending the recommendation;

• In addition to the recommendations imparted by Ennis Knupp, serious attention is

required for the establishment of adequate Risk Managements processes and controls to reduce the likelihood of future issues that call into question the motives and decisions by the SIO. Ennis Knupp has offered some suggestions and we encourage:

o establishment of a full compliance program with a Chief Compliance Officer (CCO) hired by, compensation adjusted by and reporting directly

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to the SIC with the job modeled after those that exist in large investment organizations such that, for example, all internal portfolio managers (as well as any other “access” personnel) pre-clear personal and family trading activity. In addition, internal managers should report any/all trading account statements. Moreover, this program should outline acceptable trading practices and eliminate any profit motive for short term trading gains in personal accounts. Policies should cover not just internal manager but also any direct relatives, as defined;

o creation of an Internal Audit function that is continuous and independent, reporting directly to an Audit Committee of the SIC;

o development of transparency and disclosure policies that are appropriate, effective and carefully tuned to the needs but that do not eliminate the opportunity for managers and suppliers to work for the SIO; and

o creation of a “Commissions Committee” to evaluate, on an on-going basis, all such payments made by the SIO (public and private equity, hedge funds, etc.). Comparisons of rates/arrangements to other “similar type” institutions should be made annually by external consultants (e.g. Lipper);

Allocation Study • An Allocation Study has been proposed by Bob Jacksha but currently is on hold

given numerous uncertainties in the structure and staffing of the SIO and SIC. As allocation is a most critical element of a portfolio management strategy, we believe that this work should not be deferred much longer;

Performance Reporting • Performance reporting both by the SIO and by NEPC needs to be revamped so as

to be more hierarchical, less obscure, more analytic and more user-friendly. The consultant (NEPC, currently) should spend less content covering the markets in general as, presumably, SIC members are all or will be “qualified”. More time should be focused on the portfolio and its makeup: performance attributes and quantitative breakdowns (overweighted here, underweighted there, etc.). We are pleased that Bob Jacksha currently has efforts underway on this priority. In addition, the SIC should create a “Performance Review Committee” that would include the State Investment Officer (not as Chair). Detailed results should be reported to the SIC quarterly (or potentially semi-annually). “Get-to-know-the-manager” informational sessions on the SIC agenda should be a regular occurrence, starting with internal managers;

Investment Consultants

• A process, involving the SIC in an appropriate fashion, needs to be in place soon to rebid the consulting contract that has been extended with NEPC. The new consultant to be selected (whether NEPC or another) will need to become more useful to both the SIO and the SIC in the investment process;

• A process needs to proceed soon to identify a new national Private Equity

consultant to replace Aldus; The PEIAC process needs to continue to focus on building a well-rounded portfolio across the spectrum of private equity investment options. And, we believe that a member of the above proposed Commissions

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Committee should be a member of the PEIAC to monitor terms, relationships and ask questions. We believe that special care should be taken with the “local” program. While its intentions are noble, careful oversight and monitoring is critical to assure that political bias risk is eliminated. Successful investing is difficult enough when total return is the sole goal; add in a secondary goal (economic development) and it is exponentially more difficult to manage and to assess;

Film Program

• We are pleased that the Film program consulting contract ITB recently has been issued. The newly selected consultant, in addition to the tasks assigned, needs to work with the SIO to devise a standard report template that is succinct, structured, abbreviated and hierarchical and work to write the report in language understandable to all members of the SIC. In addition, the consultant should be asked to suggest structural changes to the program to make it more cost effective for the State while not appreciably reducing its competitive nature. While much of the structure results from legislative mandate, the loss to the SIC/State from the absence of economic returns under the program is substantial;

Governmental Efficiency • The SIC manages the investment of State Endowment funds and, as well, offers

its services to New Mexico Governmental Agency clients for which it also provides investment management. This typically should be an efficient approach as it allows for scale economies as well as improves the State’s negotiating power (in the world of State Funds, our $14 billion is small), allows for the accumulation of highly specialized people and systems, etc.. While understandably a political “hot potato”, nonetheless we recommend that consideration again be given to consolidating the investment management functions of several State funds, such as the SIC, ERB and PERA.

The Subcommittee presents the above priorities, which may not be comprehensive, in the spirit of directing the SIC as it considers how it should undertake its increased oversight role of the SIO. We encourage debate and look for guidance from the full SIC with respect to these matters. Very truly yours, ANDREW DAVIS STEVEN FEINBERG PETER FRANK PAT LYONS

EXHIBIT G

State of New Mexico

STATE INVESTMENT COUNCIL

BILL RICHARDSON STEVEN K. MOISE GOVERNOR STATE INVESTMENT OFFICER

Status of implementation of Ennis Knupp RecommendationsUpdated 9/16/10

Recommendations Requirement Priority Completed Comment

1Balance the number of Governor appointees with legislative appointees or other ex‐officio members who are not part of the executive branch (see page 7)

Statutory Change * SB18

2Reevaluate public member quorum requirement in light of Council composition. (see page 7)

SIC Discussion and Possible Statutory

ChangeSB18

3 Allow for the removal of members when attendance is below 80%. (see page 7)Policy Development and

Possible Statutory Change

SB18 allowed for removal for failure to attend three consecutive meetings and this should be adequate

4Limit participation and voting at Council meetings by teleconference to no more than once every 12 months. (see page 7) Policy Development

Not addressed in SB18. Needs policy‐perhaps twice every 12 months?

5Evaluate whether an ex-officio member should be allowed to designate a specific person to attend, participate, and vote at meetings. (see page 7)

SIC Discussion and Possible Policy Development

SIO to recommend that no designees be permitted.

6 Allow the SIC to elect its own Chair and Vice-Chair. (see page 7) Statutory Change and Policy Development * SB18 partially addressed ‐ Governor still Chair of SIC, but

Vice Chair is selected by council.

7Modify the composition of the Council to prohibit any NMSIO staff from serving as Council members. (see page 7) Statutory Change * SB18

As Listed in Ennis Knupp Report

( p g )

8Require formal orientation and more structured on-going education, including annual fiduciary training. (see page 9) Policy Development * Being addressed‐for staff and Council

9 Provide specialized training for committee members. (see page 9) Policy Development Being addressed

10Include a definition of fiduciary and explicitly state the fiduciary status of anyone with discretionary authority and control over fund assets, including the SIC, the SIO, and specified staff, in statutes and the investment policy. (see page 11)

Statutory Change and Policy Enhancement

*

While SB 18 states that the state investment officer and the council are trustees and fiduciaries, there doesn't

appear to be language similar to the EK recommendation. Would also like to see staff training

here.

11Examine the intent of the Prudent Investor Act and its application to NMSIO and determine whether protections provided under the Tort Claims Act or other laws providing immunity or indemnification are appropriate. (see page 12)

SIC Discussion

*Currently working on with RMD & Aon

12Raise the Constitutional standard of care from ordinary care to that of a prudent investor to be consistent with statutes. (see page 12) Constitutional Change

13Expand existing annual disclosure requirements to all SIC members and high level staff, and ensure that the disclosure statements are being reviewed by the SIC. (see page 14)

Policy EnhancementGovernmental Conduct Act includes disclosure

requirements. Need Code of Conduct.

14Amend the Transparency and Disclosure Policy to include applicable statutory provisions such as the details regarding the gift limitations, disclosure requirements, and honoraria. (see page 15)

Policy Enhancement Add to Code of Conduct; covered by statute.

15Prohibit all gifts from prospective and current vendors in the Transparency and Disclosure Policy. (see page 15) Policy Enhancement Add to Code of Conduct

16Require more disclosure from prospective vendors to decision-makers with regard to conflicts of interest in the evaluation material to aid compliance. (see page 15) Policy Enhancement

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17Require annual disclosures of gifts, meals, entertainment above a certain threshold, and all campaign contributions and charitable contributions made on behalf of the SIC and staff made by vendors. (see page 15)

Policy Enhancement Being addressed

18Adopt a comprehensive code of ethics that includes conflicts of interest and insider trading provisions. (see page 15) Policy Development * but

Code of Ethics & implemented. Working on Trade Compliance Policy recommending the Office adopt the

CFA Code of Ethics for all employees and the CFA Standards of Professional Conduct for the investment

professionals

19 Clarify the SIC’s authority over private equity investments. (see page 17) SIC Discussion and Documentation

20Clearly establish SIC’s authority to bind NMSIO in major contracts, and its delegation to the SIO to be the signatory. (see page 17)

SIC Discussion and Documentation

21 Develop and adopt a Council charter. (see page 18) Policy Development * Need to add SIO authority to further delegate. SB18 controls

22Discuss what value an accountability matrix may have in clarifying and documenting roles and responsibilities. (see page 18) SIC Discussion

23 Develop a central governance manual with relevant policies. (see page 19) Policy Development

24Develop and adopt position descriptions for Council members and Council Officers. (see page 19) Policy Development

25 Discontinue the PEIAC unless its value can be established. (see page 21) SIC Discussion * Under consideration for statutory change.

26Ensure Council receives sufficient reports to fulfill its duty to provide oversight of delegated duties. (see page 23)

SIC and Committee Discussions *

SB 18 addressed some reporting. Substantial materials are being provided to the Council, and more will be forthcoming. Governance Committee to recommend.

27 Engage the State Auditor in discussions regarding audit scope. (see page 23) SIC Discussion

28 Develop and adopt a Governance and Audit Subcommittee charter. (see page 23) Policy DevelopmentCommittee charter has been prepared and will go to SIC

for approval at July meeting.

29 Refine statutes to clarify the authority of the Council and the SIO. (see page 24) SIC Discussion and Statutory Change

SB18

30Reevaluate the extent of delegations made to the SIO and other investment staff. (see page 24) SIC Discussion *

A Delegation of Authority and Signature Policy was approved at June SIC meeting. Further authority for staff

needs documentation.

31 Explicitly state in contracts that consultants work for the Council. (see page 25) Contract Language Change * General consultant works for SIC & SIO. Others work for

SIO.

32Include fiduciary status and the prudent investor standard of care in all applicable contracts. (see page 26)

Contract Language Change

33Reference and provide a copy of the Conflicts of Interest Act and the Transparency and Disclosure Policy with all contracts. (see page 26)

Contract Language Change

34Review NMSIO position descriptions, including the SIO’s position description, to ensure they are comprehensive, accurate, appropriate, and consistent with the laws, policies, and procedures. (see page 26)

Documentation ReviewSPO Organizational Analysis completed; need SIO

document

35 Seek Council autonomy in setting staff size. (see page 27) Statutory Change *

36Evaluate staff size in light of internal management and the extensive use of active management. (see page 27/28)

SIC Discussion and Evaluation

in progress

37 Allow SIC to appoint the SIO. (see page 28) SIC Discussion and Statutory Change * SB18

38 Give the SIO the authority in hiring and firing other staff. (see page 28) SIC Discussion and Statutory Change

Needs further statutory refinement re Govex staff

39 Add an internal audit function. (see page 28) SIC Discussion and Evaluation *

Would like to see true internal audit that reports to the Audit Committee, and perhaps a risk management

function that would report to the Investment Committee.

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40Develop a formal performance evaluation process for all staff members that is relevant and specific to the agency, and associated with some form of reward. (see page 29)

Policy Documentation Development and Enhancement

SPO is addressing; training completed.

41Seek budget autonomy but maintain fiduciary standards, transparency, and reporting requirements. (see page 30) Statutory Change *

42Evaluate the benefit of seeking an operating cost comparison with a peer group. (see page 32)


The peer groups should be carefully defined.

43Formally review the overall asset allocation of the Funds annually with the Council or a sub-committee of the Council. (see page 38)

SIC and Committee Discussions

Asset allocation changes have been approved and are being implemented. A Council Investment Committee has been formed and will review asset allocation at least

annually.

44Complete an asset allocation study every two years with the active involvement of the Council, or a subcommittee of the whole, the SIO, NMSIO staff, and the consultant. (see page 38)

SIC and Committee Discussions * Complete for 2010

45Formally review the Funds’ compliance with the approved asset allocation on a quarterly basis. (see page 38)


NEPC provides this info in the quarterly reports presented to the SIC. The Investment Committee and

Council will review.

46Evaluate the best manner in which to incorporate the nature and characteristics of the spending policy into the long-term asset allocation. (see page 38)


Currently analyzing

47Re-evaluate the tactical asset allocation authority granted to NMSIO staff, and update the policy in place to govern such delegation going forward. (see page 39)

SIC Discussion and Policy Change

The Delegation of Authority and Signature Policy and SB18 removes these broad powers and gives them to

the SIC.

48

Formally discuss and approve at the Council level any tactical decisions that will materially alter the asset allocation policy (i.e., the derivative overlay) prior to their implementation, including how their costs and benefits overtime will be reported. (see page 39)

SIC Discussion Continuing obligation

49Ensure the Council receives on-going education and information related to the risks in the alternatives portfolio. (see page 43) SIC Discussion In CIC agenda

50Reevaluate current Constitutional restrictions, especially the limitation on investment in international securities, to ensure that prudent portfolio construction is not impaired. (see pages 41 - 43)

SIC Discussion and Constitutional Change * Planning to recommend Constitutional change, for

2012.

51Ensure thorough education and analysis is presented and discussed with the Council regarding the sub-asset classes included or contemplated for the portfolio. (see page 44)

SIC Discussion

52Evaluate and adjust the domestic equity policy (U.S./non-U.S. equity split) to better reflect world equity market capitalizations. (see page 46)


53Reevaluate the current rebalancing process as set forth in the investment policy statement versus actual practice. (see page 46)


54 Tighten the allowable ranges for each asset class. (see pages 38, 46, and 47) SIC Discussion and Policy Change * Allowable ranges for asset classes have been reset.

55Revise the stated investment objectives in the IPS to include earning an appropriate risk adjusted return compared to the policy portfolio. (see page 48)


IPS being updated

56 Increase the Council’s role in risk budgeting discussions. (see page 49) SIC DiscussionConsidering creating a permanent or shared risk

management position.

57Complete a comprehensive assessment of the IPS to identify where deviation from policy currently exists. (see pages 49 - 54)

SIC Discussion and Evaluation *

57‐59 Staff in process of revising in conjunction with the asset allocation study. Will make recommendations

to Council Investment Committee.

58Update and improve the IPS and its sub-policies with the assistance of the consultant and participation of the Council or a sub-committee thereof. (see pages 49 - 54)


This is in process by the staff and will be reviewed by the Council Investment Committee before going to the

SIC

59Assign the responsibility for monitoring compliance with the IPS to an independent auditor or consultant; any violations should be reported immediately to the Council. (see pages 49 - 54)

SIC Discussion

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60Periodically review the amount of actual expense associated with internal management. (see page 55)

SIC Discussion and Reporting

Council Investment Committee is analyzing.

61Ensure the Council is provided sufficient and unbiased information to periodically assess the costs and benefits associated with active versus passive management. (see page 57)

SIC Discussion and Reporting

When getting this information from a consultant, we should use an appropriate peer group as to size, active

vs. passive, long vs. long/short strategies, etc.

62Complete a manager structure review, across all asset classes, that evaluates the number and types of managers, as well as any style or market segment biases in the portfolio. (see page 58)


This is in process as part of the implementation of the new asset allocation selected.

63Reevaluate the need for certain investment managers to also perform investment consultant functions and if necessary, clearly delineate roles, responsibilities, expectations for transparency, and reporting requirements. (see page 59)

SIC Discussion, Evaluation and Contract

Change

64Reevaluate the current level of delegation from the Council to the SIO and NMSIO staff with respect to the selection and retention of managers. (see page 60) SIC Discussion *

65Incorporate manager selection criteria and process within the investment policy statement and supporting documentation. (see pages 60 - 61)

SIC Discussion and Policy Change *

66Ensure documentation of the search process is maintained and analysis presented to the Council is complete and useful in fulfilling its fiduciary oversight responsibility. (see pages 61)

SIC Discussion

67Develop and adopt comparable criteria for selecting and evaluating internal and external managers. (see pages 60 - 61)

SIC Discussion and Evaluation *

68

Evaluate Investment Office resources available to perform external manager on-going monitoring and due diligence across all asset classes, including alternatives, and determine whether additional resources are necessary to ensure full-coverage. (see pages 60 - 61)


69 Seek statutory authority to hire and retain the custodian bank. (see page 62) Statutory Change * SB18

70Have NMSIO staff and consultants provide educational sessions tailored to the Council to highlight the benefits and risks of alternative asset portfolio construction. (see page 63)

SIC Discussion

71Modify the alternatives performance reports to include sub-asset class exposures to provide a clear picture of asset weightings. (see page 63)

SIC Discussion and Report Modification

72Seek a statutory change allowing for an exemption so that discussions and materials related to private market investments or proprietary investment strategies can be kept confidential. (see page 66)

Statutory Change *

73Increase the Council’s level of involvement in setting and periodically reviewing benchmarks, and making adjustments, when necessary. (see pages 66 - 69) SIC Discussion * In 9/10 CIC & SIC agendas

74Approve a procedure for creating and changing benchmarks for each sub-asset class and ensure they match the General IPS, any applicable specialty IPS, and subsequent performance reports. (see pages 66 - 69)

SIC Discussion Will be set by the Council Investment Committee

75Evaluate the HFRI Funds-of-Funds Index as the benchmark for the absolute return portfolio. (see pages 68 - 69)


Will be reviewed by the Council Investment Committee

76Ensure proper benchmarks are set and actually used for the domestic equities portfolio. (see page 68 - 69)


On 9/10 CIC & SIC agendas

77Re-evaluate the costs and benefits of placing broad fees caps on all external investment managers going forward. (see page 70)


78Delegate placement agent qualification review and monitoring to a qualified external consultant. (see page 75) SIC Discussion *

79Revise the placement agent policy with the assistance of a private equity consultant and require an appropriate level of disclosure to the Council for all placement agent use. (see page 75)

SIC Discussion and Policy Change * Being addressed

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80Evaluate whether adding any other elements to the performance reports (as outlined in the table) would be useful to the Council. (see pages 76 - 78) SIC Discussion * Being addressed

81Modify the quarterly performance reports to depict returns net-of-fee and include risk-adjusted returns for the total fund and each asset class. (see page 78)

SIC Discussion and Report Modification *

82Design a comprehensive compliance program for the Council’s approval. (see pages 80 - 81) SIC Discussion *

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EXHIBIT H

STATE OF NEW MEXICO


INVESTMENT COMMITTEE

CHARTER

Adopted May 25, 2010

INTRODUCTION

The Investment Committee (“IC”) is a standing subcommittee of the State Investment Council (“SIC”). The IC is charged with reviewing and making recommendations to the SIC on all investment related matters, other than those under the purview of the Private Equity Investment Advisory Committee (“PEIAC”). Neither the IC nor the SIC shall be responsible for investment decisions involved in the daily trading activities of the public equities and fixed income portfolios managed internally by the State Investment Office staff.

This Charter outlines the roles and responsibilities of the IC and its members.

ROLE

The IC assists the State Investment Council in fulfilling its responsibility in making purchases, sales, exchanges, investments and reinvestments of the assets of funds under its management in accordance with the Uniform Prudent Investor Act. All recommendations of the IC are subject to approval by the SIC.

The IC and its members shall be fiduciaries and shall make recommendations in compliance with the investment policies adopted by the SIC.

MEMBERSHIP

All members of the IC shall be appointed by the SIC. The IC’s membership shall consist of at least five members, three of which shall be members of the SIC and in no case shall the IC consist of more than five members of the SIC. Members shall be qualified by competence and experience in the field of investment or finance.

The SIC shall elect annually a Chair from among the members of the IC and may elect other officers as necessary.

An IC member shall recuse him or herself if any recommendation, action or decision of the IC will or is likely to result in direct, measureable economic gain to that person or that person’s employer.

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MEETINGS

The IC shall meet as needed, but no less frequently than quarterly, upon the call of the Chair or the State Investment Officer.

RESPONSIBILITIES

The IC’s principal responsibilities are to ensure that funds managed by the SIC are managed in accordance with the Uniform Prudent Investor Act for the benefit of the citizens of the State of New Mexico. Specific responsibilities include:

a. Formulating and recommending investment policies and guidelines regarding asset classes, asset allocation targets and ranges and prohibited investments.

b. Formulating and recommending return objectives and benchmarks for the fund as a whole and for individual asset classes.

c. Reviewing and recommending the retention or termination of any investment consultant. d. Reviewing and recommending the investment, reinvestment, redemption or termination of funds

managed by the SIC, including the retention or termination of any investment manager, securities lending agent, or transition recapture agent.

e. Evaluating investment performance of funds overseen by the SIC based on a comparison of actual returns with the SIC’s return objectives, benchmarks and relevant external peer groups.

f. Periodically reviewing the rebalancing activities undertaken by the State Investment Office staff. g. Annually reviewing the adequacy of this Charter. h. Attending to such other matters as the SIC may from time to time request.

STATE OF NEW MEXICO


GOVERNANCE COMMITTEE

CHARTER

Adopted July 27, 2010

INTRODUCTION

The Governance Committee (the “GC”) is a standing committee of the State Investment Council (“SIC”). The GC is charged with defining governance responsibilities related to the operation of the State Investment Office (the “SIO”) and the SIC.

This Charter outlines the roles and responsibilities of the GC and its members.

ROLE

The GC is created by the SIC to undertake identified governance activities relating to SIC membership, SIC committee membership, director independence, SIC member performance, compensation matters, SIC agenda setting, and developing, recommending and overseeing Governance Guidelines and Code of Business Conduct and Ethics of the Council. All recommendations of the GC are subject to approval by the SIC.

With the approval of the SIC and subject to all required processes, the GC shall have the right to engage outside expertise if, and as necessary, including consultants and legal support. The cost shall be borne by the SIO budget.

MEMBERSHIP

All members of the GC shall be approved by the SIC. The GC’s membership shall consist of at least one SIC member appointed by the Chair or Vice Chair of the SIC, and three members appointed by the SIC who are qualified by competence and experience in board governance and compensation processes. The GC will be composed of a majority of Independent Members (see below) and in no case shall the GC consist of more than five members of the SIC. The State Investment Officer shall attend meetings as a non-voting member, except where attendance would be inappropriate.

The Chair or Vice Chair of the SIC shall appoint annually a Chair from among the GC members to be approved by the SIC. The Chair of the GC must be a member of the SIC. A GC member shall recuse him or herself if any recommendation, action or decision of the GC will or is likely to result in, direct or indirect, measureable economic gain to that person or that person’s employer or family member. In addition, members are required to disclose potential conflicts or situations that might create the appearance of a conflict.

Definition of “Independent”

For purposes of membership on the GC, the following relationships preclude a member from being considered “independent”:

A. Immediate family member of current, or prior two year, executive officer of the SIO;

B. Controlling equity holder, profit participant or executive officer of an organization that has a material business relationship with the SIO; or

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C. Person who has a material direct business relationship with the SIO or SIC; or

D. Ex Officio member of the SIC

MEETINGS/REPORTING

The GC shall meet at least quarterly and on an as needed basis upon the request of the SIC Chair or Vice Chair, GC Chair or the State Investment Officer. The GC shall report periodically to the SIC on its activities and recommendations, which shall then require the approval of the SIC.

RESPONSIBILITIES

The GC shall have the following responsibilities and functions.

A. GENERAL

i. Review periodically the SIC’s committee structure and operations, and the working relationship between each committee and the SIC and recommend to the SIC the composition of the committees of the SIC.

ii. Review periodically the Governance Guidelines and recommend governance issues that should be considered by the SIC.

iii. Report to the SIC periodically the GC’s findings and recommendations and perform such other functions as may be requested by the SIC.

iv. At least annually, the GC shall evaluate its own performance and report to the SIC on such evaluation.

v. Periodically review and assess the adequacy of this Charter and recommend any proposed changes to the SIC for approval.

B. MEMBERSHIP

i. Identify and recommend candidates for the SIC, including developing criteria, reviewing candidate qualifications, conducting interviews and actively recruiting candidates for recommendation to the Governor and to the Legislature.

ii. Recommend to the SIC the names of individual members to serve on each committee of the SIC.

iii. Make recommendations to the SIC as to determinations of member independence.

iv. Direct and review orientation and continuing education programs for SIC members.

v. Develop and oversee the process for evaluation of the SIC’s members on a yearly basis.

vi. Assess the performance of SIC members at point of re-nomination; review potential conflicts of interest of SIC or SIO employees and make recommendations for changes to the SIC.

C. ADMINISTRATIVE

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i. Manage the search and selection process of, and succession planning function for, the State Investment Officer, and make recommendations to the SIC.

ii. Review and report to the SIC for approval any contract (other than those under the purview of the Investment Committee) that may exceed $50,000 over the life of the agreement;

D. COMPENSATION

i. Function as the compensation committee for the SIC and senior executives of the SIO.

ii. Identify SIC goals and objectives relevant to senior officer compensation

E. PRINCIPLES AND ETHICS

i. Oversee the development and implementation of policies, procedures, best practices and systems that will help to ensure SIO operations meet the requirements of ethics, applicable law and institutional investor best practices, including addressing at least the following:

1. Code of Conduct;

2. Ethics;

3. Transparency and Disclosures;

4. Conflicts of Interest;

5. Document Retention; and

6. Monitoring the mapping of new policies and procedures against the 2010 Ennis Knupp Study that provides recommendations for the operations and governance of the SIC.

ii. Draft and review periodically the SIC’s standards of conduct and the SIC’s statement of ethical values and conflict of interest policies.

iii. Oversee and obtain reports from the State Investment Officer on implementation of sound business and ethics policies, procedures and practices.

iv. Review potential conflicts of interest involving Council members and determine whether such Member may vote on any issue as to which there may be a conflict.

v. Ensure that proper policies, procedures and daily practices are in place with respect to due diligence and investment monitoring to ensure that third party transactions are free from conflict, influence and are appropriate.

STATE OF NEW MEXICO


AUDIT COMMITTEE CHARTER


INTRODUCTION

The Audit Committee (the “AC”) is a standing committee of the State Investment Council (“SIC”). The Committee is charged with monitoring and oversight, on behalf of the SIC, the State Investment Office (“SIO”) as it fulfills its responsibilities for accounting, financial reporting, compliance, risk management, information security, privacy practices, data protection, operational management best practices, and management of internal control processes.

ROLE

The AC is created by the SIC to monitor that the SIC and SIO issues financial statements and reports in a timely and fair manner. The AC will provide oversight of the SIC and the SIO as it develops and establishes sound policies and procedures to ensure compliance with (i) the Governmental Conduct Act, (ii) applicable securities laws, and (iii) risk management and operational risk best practices, institutional investor best practices with respect to risk measurement, (guided by Sarbanes-Oxley risk management best practices), compliance requirements, and management of internal and external controls.

Limitations on AC Role

It is not the duty of the AC to plan or conduct audits or to determine or opine that the SIC’s and SIO’s financial statements are complete, accurate and in accordance with GAAP for governmental agencies. This is the responsibility of management, independent auditor and State Auditor. While the AC is responsible for reviewing the SIC’s and SIO’s policies and practices with respect to risk assessment, risk management, and legal and regulatory compliance, it is the responsibility of the SIO to identify, recommend and decide the SIC’s appropriate level of the exposure to risk and appropriate policies to ensure compliance with all regulatory requirements.

MEMBERSHIP

All members of the AC shall be approved by the SIC. The AC’s membership shall consist of at least one SIC member appointed by the Chair or Vice Chair of the SIC, and no less than three members from the SIC appointed by the SIC who are qualified by competence and experience in accounting, governance, risk management, operational risk management, information security, internal control processes or compliance. The AC will be composed of a majority of Independent Members (see below) and in no case shall the AC consist of more than five members of the SIC. The State Investment Officer shall attend meetings as a non-voting member, except where attendance would be inappropriate.

The Chair or Vice Chair of the SIC shall appoint annually a Chair from among the AC members to be approved by the SIC. The Chair of the AC must be a member of the SIC. A AC member shall recuse him or herself if any recommendation, action or decision of the AC will, or is likely to, result in direct or indirect, measureable economic gain to that person or that person’s employer or family member. In addition, members are required to disclose potential conflicts or situations that might create the appearance of a conflict.

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Financial Knowledge of Members

Since a basic level of financial knowledge is essential for membership on the AC, all members of the AC shall be “financially literate”, i.e., able to read and understand financial statements, including a corporation’s balance sheet, income statement, and cash flow statement. It is important that some of the members of the AC have expertise in risk management, internal controls, information security, operational risk management and compliance.

Definition of “Independent”

For purposes of membership on the AC, the following relationships preclude a member from being considered “independent”:

A. Immediate family member of current, or prior two year, executive officer of the SIO;

B. Controlling equity holder, profit participant or executive officer of an organization that has a material business relationship with the SIO; or

C. Person who has a material direct business relationship with the SIO or SIC; or

D. Ex Officio member of the SIC

MEETINGS/REPORTING

The AC shall meet at least quarterly and on an as needed basis upon the request of the SIC Chair or Vice Chair, AC Chair or the State Investment Officer. The AC shall report periodically to the SIC on its activities and recommendations, which shall then require the approval of the SIC.

RESPONSIBILITIES

The Committee’s principal responsibilities are to assure the formulation of policies and procedures, as well as, the oversight of systems that are implemented by the SIO that are intended to ensure that funds managed by the SIC and SIO are protected adequately and accounted for fairly. Specific responsibilities of the AC include the following.

A. GENERAL

i. Review and concur in the appointment, replacement, reassignment, or dismissal of the Chief Financial Officer.

ii. Report to the SIC periodically the AC’s findings and recommendations and perform such other functions as may be requested by the SIC.

iii. At least annually, the AC shall evaluate its own performance and report to the SIC on such evaluation.

iv. Conduct or authorize investigations into any matters within the scope of the Committee’s responsibilities.

v. With the approval of the SIC and subject to all required processes, the AC shall have the right to engage outside expertise if, and as necessary, including consultants and legal support. The cost shall be borne by the SIO budget.

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vi. Periodically review and assess the adequacy of this Charter and recommend any proposed changes to the SIC for approval.

B. AUDIT

In discharging its oversight role in the area of audits, the AC may investigate any matter brought to its attention and shall have full access to all books, records, facilities and personnel of the SIO. The SIC and the AC are tasked to represent the stakeholders in the Funds; accordingly, the Independent Public Accountants (‘auditors”) ultimately are accountable to the SIC and the AC.

i. EXTERNAL AUDIT

Provide an open avenue of communication between the auditors, the SIO financial management, the AC and the SIC; and in conjunction with the SIO, and cognizant of the procedures and conditions set by the State Auditor and subject to SIC approval, appoint, retain, terminate, evaluate and oversee the SIC’s external auditors, including the terms of engagement, scope of audits and of agreed-upon-procedures examinations. In undertaking this role, the AC generally will be guided by a set of procedures to be developed by the AC and provided to the SIC (the “AC Procedures Statement”). The AC will meet periodically with the auditors, the Chief Financial Officer and management to discuss key matters.

ii. EXTERNAL REPORTING POLICIES

Review and discuss with management and the auditors the accounting policies that may be viewed as critical, and review and discuss any significant changes in the accounting policies of the SIC and any accounting and financial reporting proposals that may have a significant impact on the SIC’s financial reports, guided by the AC Procedures Statement.

iii. AUDITOR INDEPEDENCE, ETHICS, COMPLIANCE

i. On an annual basis, the AC actively shall engage in a dialogue with the auditors with respect to any disclosed relationships or services that may impact the objectivity and independence of the auditors in their review functions and take, or recommend that the full SIC take appropriate action to oversee the independence of the auditors.

ii. Establish policies for the engagement of the auditors with respect to their provision of services not related to their review of the SIC’s financial statements, if relevant, and consider whether the auditors’ performance of such services is compatible with the auditors’ independence.

iii. Review periodically with counsel legal compliance or regulatory issues involving the SIC or SIO that may have a material impact on the SIC’s financial statements.

iv. INTERNAL AUDIT

i. Review the necessity for, and scope of, an internal audit function which shall report to the AC as well as to the SIO

ii. Review the reports of any internal audits and the responses of management to such reports. Discuss any significant deficiencies in the design or operation of the SIO’s

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internal controls, material weaknesses in internal controls and any other material matters noted.

iii. Encourage Internal Audit to perform operational audits to improve the efficiency and effectiveness of the SIO

v. ANNUAL

i. Review the annual budget of the SIO.

ii. Provide recommendations and guidance to the SIC and Legislature with respect to the SIO’s budget.

C. RISK MANAGEMENT AND COMPLIANCE

Risk management will continue to be a priority for the SIC. The economic crisis has brought a renewed focus on risk management from stakeholders, regulators, the media and Legislature. Diligent risk management is not merely a “best practice”, but a necessary practice to ensure the success and survival of the organization. It is not only the legal and financial risks that have traditionally been overseen by the AC, but encompasses Enterprise Risk Management (ERM), a term applied to a global and holistic approach to risk management. It includes operational, financial, strategic, technology, compliance and reputational risks across the entity.

The AC shall have the following responsibilities and functions:

i. Assist in establishing policies, procedures and systems to prevent and detect any potential risks to the SIC’s assets and infrastructure.

ii. Encourage the establishment of and monitor “whistle blower” policies and procedures to enable employees of the SIO and members of the SIC to submit concerns, on a confidential and anonymous basis.

iii. Evaluate the manner in which the SIO and SIC oversees risk management.

iv. Monitor the development of an ERM process at the SIO and SIC.

v. Identify key risks for discussion at SIC meetings, including technology, reputational, compliance and other risks.

vi. Identify and encourage the appropriate “risk management culture” within the SIO and SIC.

vii. Require appropriate risk management metrics and assessments that should ensure appropriate policies and procedures are in place.

viii. Monitor the appointment of a Chief Risk Management/Compliance Officer who will look at risk management with an ERM perspective.

ix. Encourage the establishment of and monitor a compliance program within the SIO.

x. Review periodically the commissions and fees paid by the SIO in its trading and investment management activities.

STATE OF NEW MEXICO


AUDIT COMMITTEE PROCEDURES STATEMENT


INTRODUCTION

The Audit Procedures Statement is an addendum to the charter for the Audit Committee (“AC”) and provides more detailed description of the responsibilities of the Committee.

Continuous Activities - General

1. Review with the outside accountants and the Chief Financial Officer the co-ordination of review efforts in order to monitor completeness of coverage, reduction of redundant efforts, and the effective use of resources. Inquire of management, the auditors and the Chief Financial Officer (a) about significant risks or exposures and assess the steps management has taken to minimize such risks; and (b) the external economic environment within which the SIC operates.

2. Consider and review with the auditors and the Chief Financial Officer: (a) the adequacy of internal controls, and (b) related findings and recommendations of the auditors together with management’s responses.

3. Consider and review with management, the Chief Financial Officer and the auditors: (a) significant findings during the year, including the status of previous financial review recommendations; (b) any difficulties encountered in the course of financial review/audit work, including any restrictions on the scope of activities or access to required information; (c) any changes required in the planned scope of the financial review/audit plan; and (d) the financial review/audit budget and staffing.

4. Solicit recommendations from the auditors for the improvement of the SIC’s internal control procedures or particular areas where new or more detailed controls or procedures are desirable, for example, benchmarking against other relevant entities.

5. Report periodically to the SIC on significant results of the foregoing activities.

Continuous Activities - Specific Reporting Policies

6. Advise financial management and the outside accountants that they are expected to provide a timely analysis of significant current financial reporting issues and practices.

7. Discuss with the auditors their judgments about the quality of the SIC’s accounting principles as applied in its financial reporting and inquire as to bases for the outside accountants’ independent judgments about the quality, not just the acceptability, of the accounting principles and the clarity of the financial disclosure practices used or proposed to be adopted by the SIC in its financial statements or other disclosures.

8. Review and discuss with management and the auditors the accounting policies that may be viewed as critical, and review and discuss any significant changes in the accounting

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policies of the SIO and any accounting and financial reporting proposals that may have a significant impact on the SIC’s financial reports.

9. Review and discuss with management and the outside accountants whether any of the SIC’s accounting policies diverge, to their knowledge, from the policies predominantly applied by others in the same industry and, if so, the supporting rationales.

10. Inquire as to the outside accountants’ views about whether management’s choices of accounting principles are conservative, moderate, or aggressive from the perspective of income, asset, and liability recognition, and whether those principles are common practices or are minority practices.

11. Review and discuss with management and the auditors (a) any material financial or non-financial arrangements of the SIC which do not appear on the financial statements of the SIC and (b) any transactions or courses of dealing with parties related to the SIO that are significant in size or involve terms or other aspects that differ from those that would likely be negotiated with independent parties, and are relevant to an understanding of the SIC’s financial statements.

12. Review with management and the auditors the results of their annual financial review and related comments and any reports of the auditors with respect to interim periods.

101214 Placement Agent Status Report

Documents

Transcript of 101214 Placement Agent Status Report