Contract analysis

From: Graham Sutherland <gsutherland@calderwoodharkness.com> To: "Margaret S. Quinlan" <mquinlan@aldworthmcbride.com> Cc: Stephen Adler <sadler@calderwoodharkness.com> Date: Tue, 20 May 2025 04:17:00 -0000 Subject: Re: Harrowgate Fund V — Northmoor State Pension System Side Letter — Response to A&M Markup

Thank you for circulating Aldworth & McBride's detailed markup of the Northmoor State Pension System side letter, which we received last week. We appreciate the thoughtful and thorough approach your team has taken, and the discussions to date have been very productive.

This email responds on behalf of both Harrowgate Fund V GP LLC and Harrowgate Capital Partners LLC. I want to emphasize at the outset that the team at Harrowgate greatly values Northmoor's $200,000,000 commitment as the anchor limited partner in Harrowgate Private Equity Fund V LP. Given the target First Close date of August 15, 2025, and our goal of distributing the LPA and PPM to prospective LPs by June 2, we are e

We are pleased to confirm that Northmoor State Pension System will be designated as one of the initial LPAC members at the First Close. The LPAC will consist of five (5) members in total, three of whom will be designated at the First Close, with Northmoor being one of those three. Helen T. Barrows, Director of Private Markets, is confirmed as Northmoor's designated LPAC representative. As you are aware, the LPAC char

**2. Co-Investment Allocation Mechanics**

We have carefully considered Aldworth & McBride's request for enhanced co-investment rights. Harrowgate confirms that it will provide Northmoor with pro rata co-investment allocation rights on all Fund investments with an equity check exceeding $150,000,000. For context, the Fund's investment strategy targets North American mid-market and upper-mid-market buyouts with equity checks ranging from $75 million to $250 mi

The mechanics would operate as follows: the GP will notify Northmoor of qualifying co-investment opportunities at or prior to the time the investment is presented to the Fund, and Northmoor will have ten (10) business days from receipt of such notification to indicate its interest in participating. Co-investment will be offered on a no-fee, no-carry basis, consistent with prevailing market practice.

With respect to your request for a "first look" right, we are unable to grant exclusive first-look priority to any single limited partner. However, we believe the pro rata allocation right on all deals above the $150 million equity check threshold represents a significant concession that is being made available only to anchor-sized commitments. We trust this strikes the right balance.

We fully acknowledge Northmoor's status as a state governmental pension plan and the applicability of public records laws to its operations. We accept Aldworth & McBride's proposed FOIA/public records carve-out language in principle — specifically, the GP will use commercially reasonable efforts to preserve the confidentiality of Fund information, while acknowledging that Northmoor may be required to disclose certain

That said, we propose the following mutual obligations to ensure appropriate process:

(a) Northmoor will promptly notify the GP of any FOIA or public records request relating to Fund information; (b) Northmoor will seek to apply any available exemptions for trade secrets, proprietary business information, or commercial/financial information; (c) Northmoor will consult with the GP before making any disclosure to the extent permitted by applicable law.

For its part, the GP will designate specific categories of information as confidential and/or proprietary in order to facilitate Northmoor's assertion of applicable exemptions under relevant state law.

Regarding your request to delete the blanket confidentiality restriction as it applies to governmental plans, we agree to carve out mandatory disclosures compelled by law, but we do wish to retain the baseline confidentiality obligation with respect to voluntary disclosures. We believe this appropriately balances Northmoor's legal obligations with the Fund's legitimate interest in protecting commercially sensitive in

We have reviewed Aldworth & McBride's markup requesting broad excuse rights for investments in certain restricted jurisdictions or sectors. We agree to excuse rights for investments in jurisdictions subject to Northmoor's board-adopted investment restrictions, provided that such restricted jurisdictions are specifically identified in a schedule to the side letter. We would ask that Northmoor provide this schedule at

However, we respectfully decline the broader request for excuse rights based on reputational or ESG considerations without defined parameters. Our concern is that open-ended discretionary excuse rights introduce uncertainty in portfolio construction and could adversely affect the interests of other limited partners. We would propose instead that any additional excuse categories beyond jurisdictional restrictions be s

For the avoidance of doubt, the exercise of excuse rights will not reduce Northmoor's aggregate commitment amount but will adjust its pro rata share for the applicable excused investment. This is consistent with the form side letter template we have prepared for Fund V.

**5. Management Fee discount — Confirmed at 1.60%**

We confirm the management fee applicable to Northmoor's $200,000,000 commitment at 1.60% per annum on committed capital during the Investment Period. For clarity, the calculation is as follows:

- Standard management fee: 1.75% - Less Early Close discount (10 bps, available to all LPs committing at the First Close): 1.65% - Less Large LP discount (additional 5 bps, available to LPs committing $150,000,000 or more): 1.60%

Both discounts are cumulative, as reflected in the side letter. The post-Investment Period management fee remains at 1.50% on invested capital (net of realized dispositions), consistent with the LPA. This rate is not further discounted, which is consistent with the Fund's standard terms across all LP commitments. Additionally, the 100% transaction fee offset applies, further reducing the effective management fee burd

**6. Key Person Event Notification Timing**

As you know, the LPA designates Marcus J. Harrowgate and Diana R. Castellano as Key Persons, with a Key Person Event triggered if either ceases to devote substantially all of his or her professional time to the Fund.

We propose that the GP will notify Northmoor (and all LPs) within five (5) business days of a Key Person Event occurring. With respect to Aldworth & McBride's request for advance notice of anticipated departures, we are unable to commit to such advance notice due to confidentiality and employment law considerations. We are, however, prepared to agree that the GP will provide prompt notice once a Key Person Event has

Upon a Key Person Event, the Investment Period is suspended unless cured or waived by a majority-in-interest of the LPs, as provided in the LPA. We also confirm Northmoor's right, as an LPAC member, to participate in any LPAC deliberations regarding Key Person Event resolution.

*Annual In-Person Meeting.* Confirmed. Harrowgate will host an annual in-person meeting with the investment team for Northmoor and other LPAC members and anchor LPs, consistent with your request.

*GP Removal Notification.* Confirmed. Northmoor will receive prompt written notice of any no-fault removal vote (75% in interest threshold) or for-cause removal vote (majority in interest threshold) as provided in the LPA. Northmoor's governmental plan status entitles it to the additional process protections set forth in the side letter.

*Placement Agent Disclosure.* The PPM will contain full disclosure regarding the engagement of Osprey Capital Markets LLC as placement agent. Osprey's fee is 1.25% on capital placed by Osprey, payable by the Sponsor and not by the Fund. We confirm that Northmoor's commitment was not sourced by Osprey and no placement fee is payable in connection with Northmoor's commitment. We further confirm compliance with applicab

Margaret, I have attached a revised draft of the side letter in Word format, redlined against Aldworth & McBride's markup, reflecting the positions set forth above.

I would welcome a call later this week — Thursday or Friday would work well on our end — with you, Catherine, and Helen to discuss any remaining open items. As noted, our broader fundraise timeline targets distribution of the LPA and PPM to prospective LPs on June 2, with the First Close on August 15. The identified pipeline of approximately $750,000,000 in commitments, including Northmoor's $200,000,000 anchor, meet

Thank you again for the collaborative approach. I look forward to hearing from you.

Graham Sutherland Partner Calderwood & Harkness LLP 400 South Ashbury Asset Advisors, Suite 3000 Wilmington, DE 19801 620 Eighth Avenue, 42nd Floor New York, NY 10018 Direct: (212) 554-7180 gsutherland@calderwoodharkness.com

Attachment: Revised Side Letter — Northmoor State Pension System (redline against A&M markup) [.docx]