The Lynde and Harry Bradley Foundation, Inc.

Alternative Investment Update

Page V-3 includes a summary of the Foundation's alternative investments including performance data that is currently available.

The GS Private Equity Partners, L.P. is scheduled to close in April, 1997. The fund is substantially oversubscribed ($300M versus $700M commitments.) The general partner is evaluating if the fund will be increased above the $300M amount. The Foundation has a $5M commitment, but the amount could be reduced if the final fund amount is allocated among the current limited partners who have commitments.

Appendix A and B include summary information about two additional alternative investment opportunities. A summary of the advantages and disadvantages of each is presented below:

Allied Capital Midwest, LLC (Appendix A)

Advantages:

1. Major commitments from State of Wisconsin Investment Board ($25M) and	Michigan Retirement Fund ($25M).

2. Favorable fees - 2.5% payable to investment advisor. No sharing of profits.

3. Investments targeted for small privately owned businesses. Potential job	creation in a market sector which is underserved by available financing.

4. Allied Capital has a proven track record in financing small businesses.

Disadvantages:

1. Target return in the 15-20% range. This may be ambitious given the type of	target investments and mezzanine nature of the financing.

2. The potential job creation for these types of investments is consistent with	certain of the Foundation's goals and objectives in the New Citizenship	initiative. However, according to Dan Schmidt and Bill Schambra, the
proposed investment size would exclude most "grass-roots" businesses and
activities. Accordingly, the program related benefit would be minimal, if any.

3. Some uncertainty regarding influence major investors could have in investment	targets.

Recommendation: Do not invest!

Cedar Creek Partners (Appendix B)

Advantages:

1. Substantial commitment of general partner principals.

2. Although a relatively young group, the principals have a good
reputation in the community.

3. Significant commitments to date from reputable investors. Lubar & Co. ($3M);

Heller Financial Services ($3M); Banc One ($25M).

4. Principals have very successful track record with former organization (Banc	One). Overall returns averaging +36%.

5. Partnership will focus in acquisitions and recapitalizations of Midwestern-based	companies. This market is less efficient and has potential for higher returns.	Strategy involves active investment and coordination of related companies to	leverage the productivity and synergy of the combined group. These types of	investments would add diversification to the Foundation's alternative
investment portfolio.

Disadvantages:

1. Obligation of principals to service investments from prior organization.

2. Cedar Creek is an independent partnership with no larger organization
ownership or oversight.

3. Management fee of 2% is higher than current alternative investments of the	Foundation.

Recommendation:

Invest $3-5 million dollars.

Appendix C includes 1996 fourth quarter reports for certain of the alternative investments.