william blair

Download William blair

If you can't read please download the document

Upload: citywirewebsite

Post on 20-Jan-2015

1.072 views

Category:

Business


10 download

DESCRIPTION

 

TRANSCRIPT

  • 1. Citywire Montreux 2012William Blair Global GrowthKenneth J. McAtamney, Partner Thomas Ross, PartnerReto B. Baruffol, PartnerPortfolio Manager Head of European Distribution European Institutional+44 20 7297 4706Business [email protected]+41 44 287 90 [email protected] 2012 1 40807

2. Firm Overview: Built for Client Success Founded in 1935 Investment roots in high quality growth companies across allglobal markets 100% active employee owned Diversified, merit-based ownership structure 2 234015 3. Overview Asset Management Capabilities Total Assets $46.9 billionWilliam Blair & Company has beenactive in investment management Global/International Equityfor institutional and individual$27.1 billionclients since its founding. Custom Institutional AssetA number of clients who investedPortfolios Management $41.3 billion$4.8 billionwith us in our early years remainwith us decades later. Our assetUS Growth Equity$11.0 billionbase has grown substantially inrecent years. US Fixed Income$2.8 billionUS Value Equity$831 millionHedge Fund of Funds$322 millionDynamic Allocation$54 millionAs of March 31, 2012 3 232281 4. William Blair Growth StrategiesWilliam Blair Global Growth Strategy:U.S. Growth Non-U.S. Growth Emerging MarketsGlobal Unconstrained: active, alpha-seekingstrategy invested in William Blairs InternationalEmerging LeadersFocused Large Cap Growth Global Growthhighest conviction ideas$960 millionLeaders Growth$1.5 billionLeaders $2.5 billion$192 million High Quality: our highest convictionideas emphasize companies with the InternationalEmerging Markets All Cap GrowthGrowthstrongest corporate performance that we All Cap $2.4 billionGrowth(Closed 6/11)believe will be the long-term category $13.3 billion $4.7 billionwinnersSmall,U.S. Small, SMID, International SmallEmerging Marketsand Mid Cap Cap Growth Comprehensive: global researchSmall-Mid,Small Cap Growth Growth(Closed 3/11)breadth, including companies of all sizes and Mid Cap $7.4 billion1 $2.6 billion $6 millionin all marketsInternational Systematic: companies are analyzedDeveloped+Developed Plussystematically both objectively and $2.2 billionsubjectively in a global peer context InternationalExpandedMulti Alpha Uncompromising: no compromises with OpportunitiesSystematic Research$41 millionregard to either quality of company or$18 millionshare valuation; balancing operational,valuation and concentration riskAssets as of March 31, 2012. International Developed Plus includes ADR strategy assets.1Small Cap Growth, $1.2 billion; SMID Growth, $3.0 billion; Mid Cap Growth, $3.2 billion4232563 5. Global Growth Investment TeamPortfolio Management Policy/Process and Communication Ken McAtamneyW. George GreigStephanie G. Braming, CFABlake Pontius, CFA PartnerPartnerPartner BA, Michigan State BS, MITBA, DePauw BA, Michigan State MBA, Indiana MBA, Wharton SchoolMBA, University of Chicago MBA, DePaul 7 years/William Blair15 years/William Blair 7 years/William Blair6 years/William Blair 22 years/industry32 years/industry20 years/industry14 years/industryFundamental Research TeamSector ResearchStrategy Research Information Systematic ResearchConsumerFinancialsHealthcareIndustrialsResourcesTechnologyW. George Greig,Jack Murphy, CFA Joel Gomberg, CFAChristina OHara, PhD RJ Bukovac, CFAWilliam Benton, CFA Ward Sexton, CFA Spiro VoulgarisPartner PartnerPartnerPartner PartnerPartner PartnerSteve EnglehardtMelissa McGrane, CFARita Spitz, CFAMark LaneKurt Wiese, CFA, CPACasey Preyss, CFAAndy Flynn, CFA James Golan, CFAPartnerPartnerPartner PartnerPartner PartnerAndrew Kominik, CFAOlga PomerantzAlaina Anderson, CFA D.J. Neiman, CFA Thomas Sternberg, CFA Jim Jones, CFA James Golan, CFA Taylor CopePartnerPartnerTravis CopeCharles CoustanColin Williams, CFA PartnerYan Krasov, CFA Simon FennellImplementation/TradingFx and Portfolio Asia/PacificEuropeAmericas Trade Order ManagementImplementationNicola HyndsTerry OBryan, Partner Daniel Iannessa Kristin GaffudTim RandickPatrick Norwood Patrick NorwoodAs of April 2012. Research professionals shown in bold are sector team leaders.5232566 6. Investment Philosophy: High Quality and SustainableGrowth We believe that strong corporate performance is the foundation of superior long-term investment returns The essence of corporate success lies in building intrinsic strengths in the management of human capital,financial resources, and stakeholder relationships, and delivering quality, innovation, service, and value tocustomers Companies that lead in these critical areas have produced better returns on capital, over a longer timehorizon, with greater consistency and less riskGlobal Universe by Quality Quintiles Global Quality Universe Up/Down Market Performance 1580Quintile 151 2 4603 10Quintile 2Quintile 340UniverseReturns (%)20 ReturnsQuintile 4 5 0 0-20 Quintile 5 Quintiles-40 Universe123 4 -5 -60 50 5 10 152025 3035Up Market ReturnsDown Market ReturnsStandard DeviationJuly 31, 1997 - March 31, 2012. Data source: William Blair Global Universe. Quality is defined as those companies with good balance sheet metrics, efficiency, and higher returns. Up/downmarket returns based on ACWI ex-US IMI Index, monthly annualized returns. 6 234016 7. Investment Process: Integrated and InclusivePortfolio ResearchManagementIntegrated Quality/SustainableEligibility ListDesignEach element of the process isLong Term:Growth 1,800 2,500directed toward portfoliocharacteristics and performanceobjectivesShort- Operating StrategyIntermediate Performance/Term:Valuation/Risk Research AgendaInclusive60-100Members of the investment teamwork in concert toward researchconclusions and portfolio decisionsStock SelectionDecision Tactics/ReviewImplementationPortfolio Review Risk Analytics7232567 8. Defining the Universe: Eligibility ListDiverse Research UniverseGlobalFlexible universe of portfolio candidates diversified TurnoverEligibility Listacross sectors, countries, and size2008 1,69045.0%Represents 20-25% of investable universe with strongquality and sustainable growth characteristics2009 1,50132.2%Sourced from all investment team resources2010 2,05425.1%Each analyst covers, on average, approximately 1002011 2,33737.7%securitiesEligibility List Number of Companies900Global Eligibility List800700 Characteristics (%) Elig. List Benchmark600 Strong Op Margin18.6 19.7500400 Strong Cash Flow ROIC 22.5 20.6300200Higher 5-Year ROE 19.8 16.31000Consistently High Reinvestment Rate 13.8 13.412/31/2001 12/31/200212/31/2003 12/31/200412/30/2005 12/29/200612/31/2007 12/31/200812/31/2009 12/31/201012/31/2011 6/28/20026/30/2003 6/30/20046/30/2005 6/30/20066/29/2007 6/30/20086/30/2009 6/30/20106/30/2011 Superior 6-year Historical Trend Growth 13.7 10.1 Low Debt/Capital27.3 37.7 Developed ex-US United States Emerging MarketsAs of December 31, 2011. Data source: William Blair Eligibility list and ACWI IMI Index. Calculated in FactSet. 8 232568 9. Stock Selection: Decision ProcessQualitative CriteriaSystematic Factor Analysis Quality Management/business modelConsistency, high returns on assets Presentation and review ofand capital, financial strength:new recommendations from Competitive positioningabsolute and industry relativeresearch agenda Governance/transparency Focus issues Growth Long-term fundamentalperformance prospects andGrowth drivers/outlook Current, historical, prospectiverisks Valuation Expectations variables Relative & absolute valuationHistorical and currentearnings trends, stock Operating Performanceperformance, valuation Peer analysisCurrent fundamental performance Baseline analysis of howcompany scores on internal Current fundamental performancequantitative metrics Strategic Considerations 3 Rs risk, reward, relevance Thematic issues/risksAggregated sector, industry,regional dataMacroeconomic data9232303 10. Global Portfolio Construction: Comprehensive & Systematic We believe that the optimalframework for evaluating thesustainable growth prospects of We seek to hold companies that are:companies is to globally assessthe market opportunity,competitive landscape and valuechain dynamics. World This approach yields the highestLeadersquality companies with strongmanagement teams and durablegrowth prospects, whether theyLocally Tomorrowsare multinational companies or DominantWinnersare regional or local champions. We believe that by evaluatingcompanies within thisframework, we can identify thebest companies in the world,regardless of size, sector orregion. 10232574 11. Portfolio Design: Global Growth Structure Guidelines Benchmark: Geographic Exposure Sector Exposure Capitalization MSCI AC World IMIRegionRangeSector RangeMarket CapRangePacific ex-Japan 0-20% Discretionary 0-30%Large Cap 20-60% Position Size: Japan0-20% Staples 0-20%Mid Cap 20-60% Dependent on market cap, float, tradingEurope + ME ex-UK0-30% Energy0-20%Small Cap0-30% volume, price volatility, andUnited Kingdom 0-30% Financials0-35% fundamental risk/rewardW. Hemisphere 25-70% Healthcare0-30%Emerging Asia0-15% Industrials 0-30% Range:EMEA 0-10% IT0-30% 0.25 5.00% at initial purchaseLatin America0-15% Materials 0-20% Telecom Svcs. 0-15% Number of holdings:Note: TotalUtilities 0-15% 60-100Emerging Markets0-25%3.503.002.502.00Position1.50Size (%)1.000.50 --$100 mm $1,000 mm$10,000 mm$100,000 mm $1,000,000 mmMarket Cap (Logarithmic Scale) As of March 31, 2012. Policy ranges subject to change at any time. 11232575 12. Global Growth Portfolio Characteristics March 31, 2012MSCI AC World StrategyIMI Index Growth 3 Yr. EPS Growth Estimates14.7% 16.1%Our holdings have historicallyexhibited superior profitability EPS (5-year historic) 16.8%9.4%and growth, better balance sheet Returnsstructure, and reasonableReturn on Equity25.8% 16.4%valuation rates. Reinvestment Rate 24.2% 13.4% Valuation P/E (12-month projected) 13.7x 11.9x P/E (trailing 12 months) 16.5x 15.1x Float-adjusted Capitalization ($B) Weighted average market cap 63.758.5 Weighted median market cap26.422.1The strategy data shown above is taken from a representative account. The index is comparable to the strategy in terms of investment approach but contains significantly more securities.Calculated in FactSet.12 173720 13. Global GrowthPerformance for Periods Ending March 31, 2012 Since Inception Performance (% in $US)1Q 121 Year3 Years(6/30/07) Global Growth Composite 15.67 9.1627.103.07 MSCI AC World IMI 12.14 -1.18 21.64 -1.35 MSCI AC World 12.02 -0.19 21.36 -1.146/30/07 Calendar Year Performance (% in $US) 20112010 20092008 12/31/07 Global Growth Composite-2.47 22.1143.10-49.5016.00 MSCI AC World IMI-7.8914.35 36.41-42.34 0.90 MSCI AC World-6.8613.21 35.41-41.85 1.81March 2012 performance is preliminary.Investment performance assumes reinvestment of dividends and capital gains and is gross of investment management fees and net of transaction costs. Performance results will be reduced by thefees incurred in the management of the account. For example, on an account with a 1% fee, and gross performance of 20% over one year, the annual total return on a net of fee basis will result inperformance of 18.85%. A $1,000,000 initial investment would grow to approximately $1,440,000 gross of fees, versus $1,412,532 net of fees, over a two year period, assuming an annual return of20%. Investment management fees are described in William Blair & Companys Form ADV Part 2A. Past performance is not indicative of future returns. Returns for periods greater than one yearare annualized. International investing involves special risk considerations, including currency fluctuations, lower liquidity, economic and political risk. The benchmark that best reflects thecomposites investment strategy is the MSCI AC World Investable Market Index (IMI) Net, which is a free float-adjusted market capitalization index that is designed to measure equity marketperformance in the global developed and emerging markets. On June 30, 2008, the benchmark was changed from the MSCI AC World Index (Gross) to the current benchmark. The new benchmarkis more representative of the entire opportunity set for the investment strategy. The benchmark was also changed from a gross index series to a net index series to better reflect the passive returnthat could be earned by William Blairs clients. Composite consists of considerably fewer securities. Please see composite disclosure in appendix for a complete description of the composite.13169761 14. Global Growth Performance: Unconstrained & AlphaSeeking William Blairs Quality GrowthAnnualized Returns Since Inceptionstrategies have demonstrated long- Since Inception of the William Blair Global Growth Compositeterm success in the US and6/30/07 3/31/12internationally versus the broadmarket. When combined using the4%3.07%US/non-US weightings of theMSCI AC World Index, the 2%resulting pro-forma global 0.67%portfolio outperformed. 0% -1.35% This can be translated into a -2% William BlairWilliam Blair MSCI ACcohesive global strategy, which tooGlobal Growth Global World IMIis designed to add value acrossComposite Pro-Forma Indexsectors and regions over time.March 2012 performance is preliminary.Investment performance assumes reinvestment of dividends and capital gains and is gross of investment management fees and net of transaction costs. Investment management fees aredescribed in William Blair & Companys Form ADV Part 2A. Past performance is not indicative of future returns. Returns for periods greater than one year are annualized. This page issupplemental to the full performance report for the three composites shown above. The benchmark that best reflects the US All Cap Growth composites investment strategy is the Russell 3000Growth Index. International investing involves special risk considerations, including currency fluctuations, lower liquidity, economic and political risk. The benchmark that best reflects theInternational Growth composites investment strategy is the MSCI AC World ex-US Investable Market Index (IMI) Net. The benchmark that best reflects the Global Growth composites investmentstrategy is the MSCI AC World Investable Market Index (IMI) Net. Composites consist of considerably fewer securities than their representative benchmarks. Please see full disclosure statementsin the appendix for additional information on these composites and their respective benchmarks. 14234017 15. Global Growth PerformanceAnnualized Attribution by Sector, Region, and Market Capitalization (%) Three YearsSince Inception Ending 12/31/11 6/30/07 - 12/31/11MSCI ACMSCI ACThree YearsSince InceptionGlobal Global World IMIWorld IMIEnding 12/31/116/30/07 - 12/31/11 Growth Growth RegionIndexIndexMSCI ACMSCI AC GlobalGlobalWorld IMIWorld IMI United States 17.1 14.4 0.5 -1.8 GrowthGrowthSector IndexIndexDeveloped ex-US 19.09.5-3.1 -6.6 Emerging Markets32.2 20.7 3.9 -1.0Discretionary 30.5 20.4-4.1-2.5Staples 33.5 15.514.7 5.3Total Selection Effect7.12.4Energy21.9 14.0 0.9-0.8Total Allocation Effect 3.01.6Financials12.76.2 -13.5 -13.6Healthcare13.8 10.9 5.1 1.3Industrials 17.2 13.4-3.9-4.7Three YearsSince InceptionIT17.9 19.4-1.0-0.9Ending 12/31/11 6/30/07 - 12/31/11Materials 17.2 18.8 1.2-2.7 MSCI ACMSCI ACGlobal GlobalTelecom Svcs. 24.59.2 1.6-1.7World IMIWorld IMIGrowth GrowthUtilities5.42.9 -10.3-3.7Market CapIndexIndex Large Cap 14.99.7-2.3 -4.7Total Selection Effect8.02.4 Mid Cap 22.6 15.0-0.5 -4.1Total Allocation Effect 2.01.7 Small Cap 33.8 18.0 6.4 -3.0 Total Selection Effect8.43.9 Total Allocation Effect 1.6 -0.1Percentage returns shown above are annualized. Allocation and interaction effects are combined. Sectors based on Global Industry Classification (GICS) Sectors. Market cap is defined as: Large>$15 billion, Mid $3 billion to $15 billion, and Small $6,000 Annually 3,163 Profitability CurrentSustainable Competitive and Financial Fundamental Composite 3,000 CompanyTotal Market Value AdvantageStrength Performance Ranking6% CAGR expected in BRICs/N11 2,500 middle class over next 15 years Global Sector 344237 2,000 Cia Hering$4.3B Hybrid Production Model 126038 1,5001,264 1,320Clicks Group$1.6B Brands127936 1,000691 Diageo $60.3B Brands/Distribution 211717 566 First Mover & 500 Jubilant Foodworks$1.5B Distribution 7 1931 85106 165120 129 0 Nike $40.4B Brands/Marketing2 5515ChinaIndiaBrazilRussiaTotalBRICs/N11 Sa Sa $1.6B Scale/Brands1 37152010E2025E First Mover in Key YUM! Brands$32.2B Growth Markets141221Source: UN Population Division, World Bank, OECD, and Goldman Sachs ResearchAs of March 31, 2012. Scores shown above based on William Blair & Company proprietary quantitative model. The composite represents a weighted formula aggregating the individual scores.For individual and composite score ranks, 1 is best, and 100 is worst. Securities shown above are not necessarily held in the William Blair portfolios. Holdings are subject to change at any time.This is not in any sense a solicitation or offer of the purchase or sale of securities.32229485 33. Stock Selection: Maintenance, Review, Sell DisciplineGlobal Growth Liquidations YTD 12/31/11Research and portfolio teams shareresponsibility for strategic and Valuationquantitative review 4%Analysts focus on fundamentalperformance, delivery of returns.Portfolio managers have primarysell responsibility but researchinput is expected. Fundamentals 68% Portfolio Strategy 25%Sell Disciplines: Integrity/governance Execution Material adverse changeOther3% Valuation risk 33232571 34. Portfolio Construction: Strategy Input Define quality/growth universe base weightingStrategy recommendations aredesigned to inform the stockselection process as a secondary Review aggregate fundamental performance andinput using a blend of top-downvaluation parameters by sector/regionand company-level data toproduce regional and sectoralrecommendations Apply thematic and cyclical modifications as recommended 34232324 35. StrategyMSCI ACWI12/31/113/31/2012By RegionCurrentEarnings EstimatesEarnings Estimates Revisions % Earnings Estimates RevisionsAggregate ValuationGrowth ExpectationsAggregates (in $mil) Total TotalTotal3 Mo3 Mo 1 Mo1 Mo3 Mo 3 Mo 1 Mo1 Mo Agg EPSMarket EarnEarn Earn Rev RevRev Rev % Rev %Rev%Rev%Rev EPS P/EP/EP/EGrowthGrowthCAGR Cap FY0FY1FY2 FY1 FY2FY1FY2 FY1 FY2 FY1FY2Rev FY0FY1FY2FY0-FY1 FY1-FY2FY0-FY2Developed Asia - Far East - Ex Japan2,054,366 163,686 160,059180,154-7,538-4,9941,391 1,690-4.7%-2.8% 0.9%0.9% -0.6%12.6x12.8x11.4x-2.2%12.6%4.9%Developed Asia - Japan2,835,459 168,320 137,260215,726 -36,831-2,496 -4,721 2,040 -26.8%-1.2%-3.4%0.9% -4.3%16.8x20.7x13.1x -18.5%57.2% 13.2%Developed Europe - U.K. 2,479,770 220,960 226,369253,665 -17,058 -15,481 -1,285-2,491-7.5%-6.1%-0.6% -1.0% -2.9%11.2x11.0x 9.8x 2.4%12.1%7.1%Developed Europe+Me Ex Uk 6,752,841 543,165 606,751682,277 -30,370 -25,836 -4,969-3,848-5.0%-3.8%-0.8% -0.6% -2.0%12.4x11.1x 9.9x11.7%12.4% 12.1%Developed W. Hem - Ex U.S 1,434,900 101,666 110,327125,539-6,482-5,642 -1,019-808-5.9%-4.5%-0.9% -0.6% -2.3%14.1x13.0x11.4x 8.5%13.8% 11.1%Developed W. Hem - U.S 13,855,532 920,521 1,010,5821,144,558 -11,913-5,565502 2,123-1.2%-0.5% 0.0%0.2% -0.2%15.1x13.7x12.1x 9.8%13.3% 11.5%Em - Asia 5,461,999 450,559 513,125585,193 -13,276 -16,104 -6,827-6,631-2.6%-2.8%-1.3% -1.1% -1.8%12.1x10.6x 9.3x13.9%14.0% 14.0%Em - Emea 1,320,675 161,045 176,686180,071-1,247-5,750 -952-2,132-0.7%-3.2%-0.5% -1.2% -1.3% 8.2x 7.5x 7.3x 9.7% 1.9%5.7%Em - Latin America2,003,268 149,513 157,439176,381-6,841-4,649 -1,277-2,371-4.3%-2.6%-0.8% -1.3% -1.9%13.4x12.7x11.4x 5.3%12.0%8.6%Total38,198,811 2,879,434 3,098,598 3,543,564 -131,558 -86,517 -19,157-12,428-4.2%-2.4%-0.6% -0.4% -1.5% 13.3x12.3x 10.8x7.6% 14.4%10.9%Previous Month Earnings EstimatesEarnings Estimates Revisions % Earnings Estimates RevisionsAggregate ValuationGrowth ExpectationsAggregates (in $mil) Total TotalTotal3 Mo3 Mo 1 Mo1 Mo3 Mo 3 Mo 1 Mo1 Mo Agg EPSMarket EarnEarn Earn Rev RevRev Rev % Rev %Rev%Rev%Rev EPS P/EP/EP/EGrowthGrowthCAGR Cap FY0FY1FY2 FY1 FY2FY1FY2 FY1 FY2 FY1FY2Rev FY0FY1FY2FY0-FY1 FY1-FY2FY0-FY2Developed Asia - Far East - Ex Japan2,125,268 165,277 167,969180,013 -11,700-9,404 -3,275-3,593-7.0%-5.2%-1.9% -2.0% -3.4%12.9x12.7x11.8x 1.6% 7.2%4.4%Developed Asia - Japan2,822,347 171,606 141,998216,556 -40,391-9,670-23,808-2,505 -28.4%-4.5% -16.8% -1.2% -9.7%16.4x19.9x13.0x -17.3%52.5% 12.3%Developed Europe - U.K. 2,508,297 221,826 225,889253,218 -17,427 -15,745 -6,993-7,232-7.7%-6.2%-3.1% -2.9% -4.4%11.3x11.1x 9.9x 1.8%12.1%6.8%Developed Europe+Me Ex Uk 6,800,641 556,998 608,015675,341 -28,090 -26,611 -9,866-8,306-4.6%-3.9%-1.6% -1.2% -2.5%12.2x11.2x10.1x 9.2%11.1% 10.1%Developed W. Hem - Ex U.S 1,479,046 105,136 111,752125,232-6,277-5,911 -2,440-3,395-5.6%-4.7%-2.2% -2.7% -3.5%14.1x13.2x11.8x 6.3%12.1%9.1%Developed W. Hem - U.S 13,444,739 921,360 1,010,5231,142,818 -17,832 -13,767 -3,741-2,461-1.8%-1.2%-0.4% -0.2% -0.7%14.6x13.3x11.8x 9.7%13.1% 11.4%Em - Asia 5,757,381 423,564 488,964559,175-9,132-6,565 -4,245-1,510-1.9%-1.2%-0.9% -0.3% -0.9%13.6x11.8x10.3x15.4%14.4% 14.9%Em - Emea 1,387,955 155,086 183,156182,163 1,555-5,0591,218-1,685 0.8%-2.8% 0.7% -0.9% -0.4% 8.9x 7.6x 7.6x18.1%-0.5%8.4%Em - Latin America2,035,957 158,390 161,533181,118-7,866-4,616 -3,472-2,073-4.9%-2.5%-2.1% -1.1% -2.4%12.9x12.6x11.2x 2.0%12.1%6.9%Total38,361,630 2,879,242 3,099,799 3,515,632 -137,160 -97,346 -56,622-32,762-4.4%-2.8%-1.8% -0.9% -2.2% 13.3x12.4x 10.9x7.7% 13.4%10.5%For illustrative purposes only. 35232576 36. Strategy AC World All Cap by Region as of March 31, 2012 (Averages) QualityValuation 1010 2020 3030 4040 5050 6060 7070 8080 9090 Dev Asia -Dev Asia - Dev Europe - Dev Europe Dev W Hem - Dev W Hem -Dev Asia -Dev Asia - Dev Europe - Dev Europe Dev W Hem - Dev W Hem -EM - Asia EM - EMEA EM - LATAMEM - Asia EM - EMEA EM - LATAMPac ex-Japan Japan UK+ME Ex-UKCanada US Pac ex-JapanJapanUK+ME Ex-UKCanadaUSAverage 425541484839 4839 45 Average51504745 72534539 48 Max506449546044 5246 51 Max57655652 79615745 62 Min374934424135 4534 39 Min46334337 62463632 31Current 395038524338 4938 46 Current53414739 62545138 62EtrendMomentum 1010 2020 3030 4040 5050 6060 7070 8080 9090 Dev Asia -Dev Asia - Dev Europe - Dev Europe Dev W Hem - Dev W Hem -Dev Asia -Dev Asia - Dev Europe - Dev Europe Dev W Hem - Dev W Hem -EM - Asia EM - EMEA EM - LATAMEM - Asia EM - EMEA EM - LATAMPac ex-Japan Japan UK+ME Ex-UKCanada US Pac ex-JapanJapanUK+ME Ex-UKCanadaUSAverage 495150524950 5050 50 Average51625355 49525047 41 Max617562686364 5862 62 Max62817873 60696861 63 Min394033403539 3839 37 Min35314036 31283335 24Current 495150495546 5450 50 Current52514253 50324745 35Composite% Composite Score Better than 30 10100% 20 90%80% 3070% 40 60% 50 50% 60 40%30% 7020% 80 10% 900% Dev Asia -Dev Asia - Dev Europe - Dev Europe Dev W Hem - Dev W Hem -Dev Asia -Dev Asia - Dev Europe Dev Europe Dev W Hem Dev W HemEM - Asia EM - EMEA EM - LATAMEM - Asia EM - EMEA EM - LATAMPac ex-Japan Japan UK+ME Ex-UKCanada US Pac ex-JapanJapan-UK +ME Ex-UK - Canada- USAverage 455744486044 4637 44 Average 33% 19% 34% 30%15% 37% 36% 48%38% Max537057606656 5343 54 Max 46% 36% 55% 43%26% 49% 46% 58%53% Min384435395036 4032 35 Min 24%6% 13% 17% 2% 23% 27% 35%25%Current 444639465340 5135 50 Current 33% 33% 39% 29%20% 41% 27% 48%31%For illustrative purposes only. 36232577 37. Strategy AC World All Cap by Sector as of March 31, 2012 (Averages)Quality Valuation10 1020 2030 3040 4050 5060 6070 7080 8090 90 Consumer ConsumerStaples Energy Financials Health Care Industrials Tech Materials Telecom Utilities Staples Energy Financials Health Care Industrials Tech Materials Telecom Utilities Disc.Disc.Average43 3840523449 44 46 40 53 Average50 54 47 4259515547 43 46Max51 4245593957 49 57 48 60 Max56 65 58 4770556859 56 64Min38 3633483044 38 38 36 46 Min43 45 38 3645474338 33 34Current42 3639543450 42 42 39 53 Current53 61 50 4053514745 43 55 EtrendMomentum10 1020 2030 3040 4050 5060 6070 7080 8090 90 Consumer ConsumerStaples Energy Financials Health Care Industrials Tech Materials Telecom Utilities Staples Energy Financials Health Care Industrials Tech Materials Telecom Utilities Disc.Disc.Average51 5043525049 52 49 50 51 Average54 48 44 5452525949 55 50Max62 6169645963 72 70 66 63 Max69 69 72 6868638059 77 74Min38 3518423440 34 36 32 28 Min37 23 21 4230404033 38 35Current44 4951474749 44 67 59 55 Current37 32 48 5038444353 49 46 Composite % Composite Score Better than 3010 100%2090%80%3070%4060%5050%6040%30%7020%8010%90 0% Consumer Consumer HealthStaples Energy Financials Health Care Industrials Tech Materials Telecom Utilities Staples Energy Financials Industrials Tech Materials Telecom Utilities Disc.Disc. CareAverage47 43 40 494350 50 46 40 51 Average34% 36%46%27% 39% 30%31%35%45% 26%Max53 47 51 575260 66 56 58 63 Max46% 47%70%37% 52% 43%44%49%57% 42%Min39 38 26 413542 40 36 33 41 Min26% 27%22%17% 22% 19%13%21%21% 15%Current41 42 45 463749 40 49 43 56 Current44% 38%36%27% 45% 26%41%31%39% 23%For illustrative purposes only.37 232578 38. Strategy Input: Concept, Agenda, Execution, and Review Strategy Team ThematicSector-Based SystematicThematic/MacroGeorge Greig Development Analytics Consumer Quality/GovernanceQuantitativeMelissa McGrane, CFA Policy InitiativesFinancialValuation DemographicsHealthcare Earnings TrendEconomics Olga Pomerantz Technical Evolution Industrial MomentumResearch Director Joel Gomberg, CFA Lifestyle ResourcesGrowthPortfolio AnalysisStephanie Braming, CFA Market EnvironmentTechnology Return Projections Portfolio TeamResearch Team Trading Team 38232323 39. Global Growth Portfolio Attributes March 31, 2012Average Quantitative Scores (Percentile Ranks)WB LT Growth EarningsEst. QualityTrend Momentum Valuation Composite8.6%36.445.336.847.335.8 MSCI AC World IMI Index 9,000 companies Eligibility List of 2,000 companies 10.4%34.746.738.456.639.8 20% of the MSCI AC World IMI Index Global Growth portfolio of 60-100 companies 10.9%20.130.523.464.924.1 1% of the MSCI AC World IMI IndexScores shown above based on William Blair & Company proprietary quantitative model. The composite represents a weighted formula aggregating the individual scores. For individual andcomposite score ranks, 1 is best and 100 is worst. The MSCI AC World IMI Index is designed to measure equity market performance in the global developed and emerging markets, making itcomparable to the William Blair Global Growth Portfolio in terms of investment approach; however the index contains significantly more securities than the William Blair Portfolio.39228039 40. Global Growth Portfolio Characteristics March 31, 2012Quality Score - AggregateGrowth Score - Aggregate ETrend Score - Aggregate 00 020 202040 404060 606080 8080100 100 100 20072008 2009 2010 20112007 2008 2009 2010 20112007 2008 2009 2010 2011Global Growth Equity Global Growth EquityGlobal Growth EquityMSCI AC World IMIMSCI AC World IMI MSCI AC World IMI Valuation Score - Aggregate Momentum Score - Aggregate Composite Score - Aggregate 00 020 202040 404060 60 60 8080 80100 1001002007 2008 2009 2010 20112007 2008 2009 2010 20112007 2008 2009 2010 2011 Global Growth EquityGlobal Growth EquityGlobal Growth Equity MSCI AC World IMI MSCI AC World IMI MSCI AC World IMIScores shown above based on William Blair & Company proprietary quantitative model. For individual and composite ranks, 1 is best and 100 is worst. 40229397 41. Global Growth PerformanceGlobal Growth Composite vs. MSCI AC World IMI IndexUp/Down Market Returns 6/30/07 3/31/1260% 48.56% 40.79%40%20% 3.07% 0%-1.35% -20% -40%-37.64% -39.51% -60%Up Markets (Positive Quarters) Down Markets (Negative Quarters)Total Return (All Markets)Global Growth Composite MSCI AC World IMI IndexUp markets capture ratio1.19Down markets capture ratio0.95March 2012 performance is preliminary.Calculated using quarterly, annualized data. Investment performance assumes reinvestment of dividends and capital gains and is gross of investment management fees and net of transactioncosts. Performance results will be reduced by the fees incurred in the management of the account. For example, on an account with a 1% fee, and gross performance of 20% over one year, theannual total return on a net of fee basis will result in performance of 18.85%. A $1,000,000 initial investment would grow to approximately $1,440,000 gross of fees, versus $1,412,532 net offees, over a two year period, assuming an annual return of 20%. Investment management fees are described in William Blair & Companys Form ADV Part 2A. Past performance is not indicativeof future returns. Returns for periods greater than one year are annualized. International investing involves special risk considerations, including currency fluctuations, lower liquidity,economic and political risk. Global Growth Composite inception 6/30/07. The benchmark that best reflects the Global Growth composites investment strategy is the MSCI AC World InvestableMarket Index (IMI) Net, which is a free float-adjusted market capitalization index that is designed to measure equity market performance in the global developed and emerging markets.Composite consists of considerably fewer securities. Please see composite disclosure in appendix for a complete description of the composites. 41230592 42. Global Research TeamSector Analyst Years atYears inEducation William Blair1 Industry2Consumer Jack Murphy, CFA, Partner715 BA, Villanova University Rita Spitz, CFA, Partner 25 33 BBA, Wisconsin Madison; MBA, University of Chicago Alaina Anderson, CFA, Partner510 BS, Univ. of Pennsylvania; MBA, University of Chicago Charles Coustan47BA, University of Michigan; MBA, UC BerkeleyFinancials Joel Gomberg, CFA, Partner 15 18 BS, University of Illinois; MBA, University of Chicago Co-Director of Research Mark Lane, Partner 14 19 BA, Northwestern University; MBA, University of Chicago D.J. Neiman, CFA 10 13 BS, Miami University; MBA, University of MichiganHealthcare Christina OHara, PhD, Partner 612 PhD, Purdue University; MBA, Wash U in St. Louis Kurt Wiese, CFA, CPA, Partner11 13 BS, Indiana University; MBA, University of Chicago Thomas Sternberg, CFA79BS, Duke University; MBA, University of ChicagoIndustrialsRJ Bukovac, CFA , Partner524 BA, Cornell University; MSA, DePaul University Casey Preyss, CFA, Partner 11 12 BS, BA, Ohio State University; MBA, University of Chicago Jim Jones, CFA 111 BS, Miami University; MBA, University of North CarolinaIT William Benton, CFA , Partner14 14 BS, University of Illinois; MBA, Tuck School Andy Flynn, CFA, Partner 621 BA, University of Kansas; MBA, UNC Chapel Hill James Golan, CFA, Partner11 23 BA, DePauw University; MBA, Northwestern University Colin Williams, CFA, Partner 11 13 BA, Grove City College Simon Fennell119 MA, University of Edinburgh; MBA, Cornell UniversityResourcesWard Sexton, CFA, Partner12 12 BS, University of Illinois; MBA, University of Chicago James Golan, CFA, Partner11 23 BA, DePauw University; MBA, Northwestern University Taylor Cope56MA, University of St. Andrews Travis Cope34BA, University of St. Andrews Yan Krasov, CFA59BS, Northwestern University; MBA, University of ChicagoStrategy ResearchMelissa McGrane, CFA 10 10 BS, Coe College; MBA, University of Chicago Olga Pomerantz 29BS, University of Chicago, MSc, London School of EconomicsSystematic ResearchSpiro Voulgaris418 BA, MBA, University of Chicago Steve Englehardt 14BA, Boston College Andrew Kominik, CFA88BA, Brandeis University; MBA, University of ChicagoAs of April 2012. Research professionals shown in bold are sector team leaders.1. Average years at William Blair is 8 years and the median is 7 years.2. Average years in Industry is 14 years and the median is 13 years. 42232294 43. Client Relationship ManagementU.S. Client Relationships European Business Development And Client Relationships John McLaughlin, CFATom Ross, Partner PartnerHead of European InstitutionalHead of Institutional Client Relationships Distribution Reto Baruffol, PartnerBusiness Development and ClientClient Relationship Services, Continental Europe Client Services Management Bob Duwa, CFAStefan Hess Julie Stevens, CFA Senior CRM Client Services, Continental Europe Head of Client Services Doug Kryscio, CFA Cliff Kalish Senior CRM Senior Client Services Associate Megan Schlesinger Senior Client Services Associate Alex Schneider Senior Client Services Associate Lizett Ternes Client Services Associate Audrey Daniels Client Services Associate Dana Denizman Client Services AssociateAs of April 2012.43 231525 44. Global Equity TeamW. George Greig, PartnerGeorge Greig joined William Blair & Company in 1996 as International Growth Team leader. In addition to this role, George is the portfolio manager for the William Blair InternationalGrowth and International Leaders strategies and co-portfolio manager of the Global Growth strategy. He also serves as the global strategist for William Blair & Companys InvestmentManagement Group and is on the firms Executive Committee. Prior to joining the firm, George headed international equities for PNC Bank in Philadelphia and previously served asInvestment Director with London-based Framlington Group PLC, where he also managed global and emerging markets funds. George has over 25 years of experience in domestic andinternational investment research and portfolio management. Education: B.S., Massachusetts Institute of Technology; M.B.A., Wharton School of the University of Pennsylvania.Kenneth J. McAtamney, PartnerKen McAtamney is a co-portfolio manager for the William Blair Global Growth strategy. He joined William Blair & Company in 2005 as part of the International Growth team and previouslyserved as co-director of research, as well as mid-large cap Industrials and Healthcare analyst. Prior to joining William Blair, Ken was a Vice President for Goldman Sachs and Co., responsiblefor institutional equity research coverage for both international and domestic equity, and he was a Corporate Banking Officer with NBD Bank. Education: B.A., Michigan State University;M.B.A. Indiana University.Stephanie G. Braming, Partner, CFAStephanie Braming joined William Blair & Company in 2004 as the International and Global Equity Specialist. She participates in the teams decision-making meetings, conducts portfolioanalysis and is responsible for communicating current portfolio structure and outlook to clients, consultants, and prospects. Prior to joining the firm, Stephanie was a Principal at MercerInvestment Consulting, where she was responsible for the strategic investment direction of her public fund, corporate, healthcare and foundation clients. In addition to her clientresponsibilities, Stephanie served on Mercers United States Research Rating Committee, which assessed research ratings for investment manager strategies. Prior to her role at Mercer,Stephanie worked at the Federal Reserve Bank of Chicago. She is a member of the CFA Institute and the CFA Society of Chicago where she recently served on the Societys Board of Directors.Education: B.A. DePauw University; M.B.A., University of Chicago Booth School of Business.Blake S. Pontius, CFABlake Pontius joined William Blair & Companys International Growth team in 2005. As International Equity Specialist, Blake participates in the teams decision-making meetings, conductsportfolio analysis and is responsible for communicating current portfolio structure and outlook to clients, consultants, and prospects. Previously, he was a Client Relationship Managerresponsible for senior level relations with the firms institutional International Growth clients. Prior to joining William Blair, Blake was with UBS Global Asset Management in consultantrelations/communications and a Senior Analyst at Mercer Investment Consulting. He is a member of the CFA Institute and the CFA Society of Chicago. Education: B.A. with honor inEconomics, Michigan State University; M.B.A. with distinction in Finance, DePaul University.44103385 45. BiographiesResearch:Alaina Anderson, Partner, CFAAlaina Anderson joined William Blair & Company in 2006 as an analyst on the International Growth team, focusing on small cap Consumer stocks. Prior to joining William Blair & Company,Alaina was a Senior Analyst in the Investments Department of the MacArthur Foundation. Her responsibilities included providing research support for internally managed portfolios, as wellas investment manager due diligence, selection and monitoring for the Foundations U.S., Non-U.S. and hedge fund portfolios. Prior to her tenure with the MacArthur Foundation, Alainaserved as an investor relations consultant with Ashton Partners and a financial advisor with UBS Painewebber. Alaina is a trustee of Lawrence Hall Youth Services and a member of theInvestment Analyst Society of Chicago. B.S., University of Pennsylvania Wharton School; M.B.A., University of Chicago Booth School of Business.William W. Benton, Partner, CFA, CPAWilliam Benton is the Technology Sector Team Leader and Research Analyst focused on US large cap companies. He joined the team in his current role in 2007 and previously was aResearch Analyst within the Technology sector of William Blairs sell-side research group for 10 years. In this position, William was twice named Best on the Street in The Wall StreetJournals annual analyst survey. He joined William Blair & Company in 1997. Prior to that, he worked at SBC Warburg, U.S. Cellular, May Department Store, and Monsanto. He is a member ofthe CFA Society of Chicago and holds the Certified Management Accountant designation. Education: B.S., Finance, University of Illinois Champaign-Urbana; M.B.A., Dartmouth College (TuckScholar), Amos Tuck School of Business Administration.RJ Bukovac, Partner, CFA, CPARJ Bukovac is the Industrials Sector Team Leader and Research Analyst focused on US large cap companies. He joined William Blair & Company as a Research Analyst in 2007. Previously, RJworked in the research department and within the portfolio teams of Putnam Investments for 10 years. During his time at Putnam, he covered a broad range of domestic and internationalequities including Industrial, Consumer Cyclicals, Consumer Staples, and Diversified Media. Prior to that, he was an analyst for privately-held businesses and determined Fair Market Valuesfor purposes of reorganizations, divestitures, as well as mergers and acquisitions in the Valuation Consulting Practice of Price Waterhouse in Chicago for nine years. RJ is a member of theCFA Society of Chicago and the CFA Institute, as well as the Illinois CPA Society and AICPA. Education: B.A., Economics and Finance, Cornell University; M.S.A., DePaul University.Harvey H. Bundy, CFA, PartnerHarvey Bundy is the Co-Director of Global Research for Investment Management and a small and mid cap generalist Research Analyst focused on US companies. Prior to refocusing hisefforts to research in 2008, Harvey was a Portfolio Manager for the Mid Cap Growth and Small-Mid Growth teams. He co-founded the Small-Mid Growth team in 1998. Prior to that, Harveyserved as the Director of Research in the firms sell-side research group, where he was responsible for the selection of names on the firms Current Better Values List. His more than 25 yearsof analytical coverage has included Connectors, Specialty Insurance, Insurance Brokers, Software, and Distribution. Harvey was a member of the firms Executive Committee from 1988through 1997, and originally joined William Blair & Company in 1968. Education: A.B., Yale University; M.B.A., Dartmouth College Amos Tuck School of Business Administration.Taylor CopeTaylor Cope is an International Research Analyst covering the Energy, Materials and Utilities sectors. He joined William Blair & Company in 2007 as an International Research Associate,working as a generalist on individual projects under the guidance of research analysts. Prior to joining the firm, Taylor was a Research Analyst at Giuliani Capital Advisors in Chicago, wherehe was responsible for new opportunity generation, deal support and industry intelligence in the Retail, Consumer and Financial sectors. Education: M.A. (Hons), University of St. Andrews,Scotland. He is a Level III CFA candidate.Travis CopeTravis Cope is an International Research Analyst covering the small cap Energy and Materials sectors. He joined William Blair & Company in 2008 as a Global Research Associate, supportingthe Global Energy team under the guidance of research analysts. Prior to joining the firm, Travis was an Analyst at Macquarie Bank in Chicago, where he engaged in Corporate Restructuringadvisory. Education: B.A., International Relations and Modern History, University of St. Andrews, Scotland.Charles J. CoustanCharles Coustan is a Research Analyst on the Consumer sector team, focused on US small cap companies. He joined William Blair & Company as a Research Analyst in 2007. Previously,Charles was a Research Analyst at Wells Capital Management covering Semiconductors and Consumer stocks for two years. Prior to that, he was a Research Analyst at Lincoln EquityManagement focusing on Consumer stocks for two years. He also spent five years in various entrepreneurial roles in the technology industry, including experience in Internet productmanagement and marketing and a lead role in the sale of one firm. Charles also has seven years of investment experience in commercial real estate. Education: B.A., Economics, University ofMichigan; M.B.A., University of California at Berkeley Haas School of Business.Dan Crowe, CFADan Crowe is a Research Analyst focused on the U.S. small cap space across all sectors. He joined William Blair & Company as a Research Analyst in 2011. Previously, he was a midcapportfolio manager at Pyramis Global Advisors and prior to that a portfolio manager and analyst at The Boston Company / Founders Asset Management. He began his career as a generalistanalyst at Marsico Capital Management. Dan is a member of the CFA Institute and the CFA Society of Boston. Education: B.S. in Mechanical Engineering from the University of Illinois.45103386 46. BiographiesSimon FennellSimon Fennell joined William Blair & Company in 2011 as an analyst on the International Growth team, focusing on large cap Technology, Media and Telecom stocks. Previously Simon was aManaging Director in the Equities division at Goldman Sachs in London and Boston, where he was responsible for institutional, equity research coverage for European and Internationalstocks. Previously, Simon was in the Corporate Finance Group at Lehman Brothers in London and Hong Kong, working in the M&A and Debt Capital Markets Groups. Education: M.A.,University of Edinburgh; M.B.A., Johnson Graduate School of Management, Cornell University.Andy G. Flynn, Partner, CFAAndy joined the International Growth team in 2007 and conducts research on small cap Technology, Media and Telecom Services stocks. Prior to joining the International team, Andyfocused on domestic Consumer and Industrial companies at William Blair for two years. Before joining the firm, Andy was employed as a Senior Equity Analyst and Portfolio Manager atNorthern Trust specializing in mid and small capitalization growth companies. Prior to that he worked as a Senior Equity Analyst at Scudder Kemper Investments and began his career atFidelity Investments as a Research Assistant. Andy is a Chartered Financial Analyst, and a member of the CFA Institute and the CFA Society of Chicago. Education: B.A., Economics, Universityof Kansas; M.B.A., Finance emphasis, University of North Carolina at Chapel Hill.Joel Gomberg, Partner, CFAJoel Gomberg is the Co-Director of Global Research for Investment Management, Global Financials Sector Team Leader, and conducts mid-large cap non-US Financials research. Beforejoining the International Growth team in 2006, Joel was the group head of the Financial sector within William Blair & Companys sell-side Research Department. He joined the firm in 1997 asan equity analyst following the Finance industry, including Commercial Banks, Global Investment Banks, Exchanges, Retail Brokers and Commercial Property Service companies. In this role,Joel was included in The Wall Street Journals annual analyst survey, Best on the Street three times. Previously, Joel was an equity analyst at Duff & Phelps and Howe Barnes Investmentscovering specialty finance and bank stocks. He also worked at The Northern Trust Company, primarily in commercial banking and credit policy. Education: B.S., University of Illinois atUrbana/Champaign; M.B.A., University of Chicago Booth School of Business.Jim Jones, CFAJim Jones is a Research Analyst on the Industrials sector team, focused on US small cap companies. He joined William Blair & Company as a Research Analyst in 2010. Previously, Jim was anInvestment Analyst at Federated Investors for four years. Prior to that, he was a Research Analyst at Credit Suisse in 2005 and an Associate at Ashton Partners for nearly two years. Jim is amember of the CFA Institute and the CFA Society of Pittsburgh. Education: B.S., Accounting, Miami University; M.B.A., University of North Carolina.Yan Krasov, CFAYan Krasov is a Research Analyst on the Industrials sector team focused on US small cap Materials, US all cap Transports, and US all cap Engineering and Construction stocks. Yan joinedWilliam Blair & Company in September of 2006 as a Research Associate. Prior to joining the firm, Yan spent four years at JPMorgan Securities in Chicago, where he began his career inInstitutional Equity Sales and in the Private Client Services division. Education: B.S., Speech and Economics, Northwestern University; M.B.A., University of Chicago Booth School of Business.Mark Lane, PartnerMark Lane is a Research Analyst on the Financials sector team focused on US companies across all capitalizations. He joined the team in April 2011 after serving as a financial sector analystwith the firms sell-side Research Department, where he specialized in asset management, brokerage, exchanges, and investment banking. He joined William Blair & Company in 1998.Previously, Mark worked as a senior underwriter for The St. Paul Companies, analyzing specialty property-casualty insurance risks. He also worked at Goldman Sachs in Chicago as ananalyst in the high-net-worth money management group. Education: B.A. Economics, Northwestern University; M.B.A., University of Chicago Booth School of Business.Jack Murphy, Partner, CFAJack Murphy joined the International Growth team in early 2011, conducting research on large-mid cap Consumer stocks. He is the Global Consumer sector team leader. Prior to joining theInternational team, Jack was a Research Analyst within William Blair & Companys sell-side Research Department focusing on e-commerce and hardline retailers. He joined the firm in 2005.Previously, Jack worked at Credit Suisse First Boston for nearly six years as an equity research analyst covering a broad range of retail companies. Before CSFB, he worked as an equityresearch analyst at Lehman Brothers and as an equity research associate at Salomon Brothers. Prior to sell-side research, he worked as a financial analyst for General Electric Capital, havinggraduated from GEs Financial Management Program. Education: B.A., Economics, magna cum laude, Villanova University.D.J. Neiman, CFAD.J. Neiman is an International Research Analyst covering small cap Financial stocks. Before transitioning to the International Growth team in December 2009, he was an analyst in WilliamBlair & Companys sell-side research group, covering the Financial sector with a focus on the asset management and advisory investment banking industries. Previously, he was a senioraccountant with William Blair Funds and a fund analyst at Scudder Kemper Investments. He was awarded the Chartered Financial Analyst designation in 2002 and is a member of the CFASociety of Chicago. Education: B.S., Miami University; M.B.A., high distinction, University of Michigan Ross School of Business.Christina M. OHara, Partner, Ph.D.Christina OHara is the Healthcare Sector Team Leader and Research Analyst, focused on US large and mid cap companies. She joined William Blair & Company in 2005 as a Research Analyst.Previously, Christina was employed as a Senior Equity Analyst at Principal Financial Group specializing in small capitalization Healthcare companies. Prior to that, she was as an EquityAnalyst at Bank of America. Prior to joining the investment industry, Christina spent eight years as a research scientist, studying neurological disorders. Education: B.A., Biology and French,Hillsdale College; M.B.A., Finance emphasis, Washington University - St. Louis; Ph.D., Biological Sciences, Purdue University - Indianapolis. 46 103387 47. BiographiesCasey K. Preyss, Partner, CFACasey Preyss is an International Research Analyst covering large cap Industrials stocks. He joined William Blair & Companys International Growth Team in 2003 as a Quantitative Analyst.Previously, Casey spent three years as an Investment Associate and Performance Analyst within William Blair & Company. Prior to joining the firm, Casey was with Thomas WhiteInternational as an International Equity Research Sales Associate. Education: B.S. B.A., The Ohio State University; M.B.A., University of Chicago Booth School of Business.Ward D. Sexton, Partner, CFAWard Sexton is the Energy Sector Team Leader and a Research Analyst, focused on US companies across all capitalizations. He joined the team in 2001 and previously was with WilliamBlairs corporate finance group for two years. He joined William Blair & Company in 1999. Ward is a member of the CFA Institute and the CFA Society of Chicago. Education: B.S., Financewith Honors, University of Illinois Urbana-Champaign; M.B.A., High Honors, University of Chicago Booth School of Business.Rita Spitz, Partner, CFARita Spitz is a Research Analyst focused on US large and mid cap Consumer companies. From 2001 to 2008, she was the Director of Research in Investment Management at William Blair, andfrom 1999 to 2001, she also served as a Research Analyst. Previously, Rita was an Analyst for the firms sell-side research group covering Advertising and Marketing firms for thirteen years.She joined William Blair & Company in 1986. Prior to that, she was with Northern Trust Company for seven years and was also an Equity Analyst at Harris Bank and Trust. At these firms shecovered Retail, Broadcasting, Cable, Publishing, Consumer Products, and Distribution companies. Rita is a member of the CFA Society of Chicago, the CFA Institute and The Economic Club ofChicago. Between 2002 and 2006, she served as a member of the Financial Accounting Standards Advisory Council, which provides the Financial Accounting Standards Board perspectivefrom financial-statement preparers and users and professionals from the accounting and securities industries. Rita also is a trustee of the Music Institute of Chicago and The Joffrey Ballet.Education: B.B.A., Finance and Spanish, University of Wisconsin-Madison; M.B.A, University of Chicago Booth School of Business.Thomas A. Sternberg, CFATommy Sternberg is an International Research Analyst covering Healthcare stocks. He joined William Blair & Company in 2004 as a Research Associate in Investment Management focusingprimarily on the Healthcare industry. Previously, Tommy spent two years at Oak Brook Bank where he served as an equity analyst in the Investment Management and Trust Department. Heholds the Chartered Financial Analyst designation and is a member of the CFA Society of Chicago. Education: B.S., Economics, Duke University; MBA, University of Chicago Booth School ofBusiness.Mark C. Thompson, CFAMark Thompson is a Research Analyst focused on the U.S. small cap space across all sectors. He joined William Blair & Company as a Research Analyst in 2006. Previously, he was a researchgeneralist at Kidron Capital for three years. Prior to that, he was a Research Analyst covering Healthcare at American Express for two years. Mark is a member of the CFA Institute and theCFA Society of Chicago. Education: B.B.A., Finance (emphasis in Accounting), University of Iowa; M.B.A., Finance, University of Iowa.Kurt M. Wiese, Partner, CFA, CPAKurt Wiese is a Research Analyst on the Healthcare sector team, focused on US small cap companies. He joined the team in 2001 after serving as a member of William Blairs corporatefinance Healthcare team, where he was engaged in all aspects of transaction execution. He joined William Blair & Company in 2000. Prior to that, he worked in the Chicago audit practice ofPricewaterhouseCoopers for two years. Kurt is actively involved within the Chicago community through his philanthropic work at the Chicago Jesuit Academy, a full-scholarship, college-prep, middle-school for underprivileged boys on Chicagos West Side. Kurt was a participant at the Center for Japanese Language and Culture at Nanzan University in Nagoya, Japan.Education: B.S., Accounting and Finance, Indiana University; M.B.A., University of Chicago Booth School of Business.Colin Williams, Partner, CFAColin Williams is a Research Analyst on the Technology sector team, focused on US small cap companies. He requested to resume his research responsibilities in 2008 after co-managing theSmall Cap Growth strategy for two years. He originally joined William Blair Investment Management as a Research Analyst in 2002. Prior to that, he worked as a Research Associate in thefirms sell-side research group. He joined William Blair & Company in 2000. Previously, Colin held several finance positions of increasing responsibility at Allegiance Healthcare, a division ofCardinal Health. Colin is a member of the CFA Institute and the CFA Society of Chicago. Education: B.A., Economics, Grove City College.Portfolio Management:Michael P. Balkin, PartnerMichael Balkin is a Portfolio Manager on the Small Cap Growth team. He rejoined William Blair & Company in 2008 after three years as a Portfolio Manager and Chief Investment Officer ofMagnetar Investment Management. He originally joined the William Blair Small Cap Growth team as a Portfolio Manager in late 1999. Prior to that, he worked in William Blairs sell-sideinstitutional research sales group, specializing in small cap growth companies. Michael originally joined the firm in 1990. Education: B.A., Northwestern University.Karl W. Brewer, Partner, CFAKarl Brewer is a Portfolio Manager on the Small Cap Growth and Small-Mid Cap Growth teams. He joined the Small Cap Growth team in 1999 and the Small-Mid Growth team in 2002. Hejoined William Blair & Company in 1996, serving as a Research Analyst for three years. Prior to that, he was in the Mergers & Acquisitions and Corporate Finance Departments at LehmanBrothers Inc. for six years. Education: B.A., Washington and Lee University; M.B.A., Northwestern University Kellogg Graduate School of Management.David C. Fording, Partner, CFADavid Fording is a Portfolio Manager on the All Cap Growth team. He joined the team and William Blair & Company in 2005. From 2010 to 2011, he was also Co-Director of Global Researchfor Investment Management. Previously, David was a Portfolio Manager for the Mid Cap Growth Fund at TIAA-CREF Investment Management, Inc. for two years. Prior to that role, he was anEquity Analyst responsible for covering Media and Entertainment stocks on a global basis for five years, and he was a member of the Large Cap Growth Portfolio Management team for twoyears. He is a member of the CFA Institute and the CFA Society of Chicago. Education: B.A., Economics, summa cum laude, Tufts University, Phi Beta Kappa; M.B.A., Finance, New YorkUniversity Stern School of Business.47103388 48. BiographiesJames Golan, Partner, CFAJim Golan is a Portfolio Manager on the Large Cap Growth team and has been a member since 2005. Beginning in 2011, in addition to his role as a Portfolio Manager, he is responsible forresearch coverage of large cap stocks within the Technology and Resource sectors. From 2000 to 2007, Jim served as a Research Analyst focusing on Financial, Technology, Industrial andResource companies. He joined William Blair & Company in 2000. Previously, Jim worked at Citigroup Global Asset Management where he was a Global Research Team Leader for theTelecom sector and a key member of the team that devised valuation metrics for standardizing the analysis of domestic and international companies. Jim began his career at KemperFinancial as a Research Analyst covering Telecom, Technology, Energy and Industrial companies. He is a member of the CFA Institute and the CFA Society of Chicago. Education: B.A.,Economics, DePauw University; M.B.A., Finance, Northwestern University Kellogg Graduate School of Management.John F. Jostrand, Partner, CFAJohn Jostrand is a Portfolio Manager on the All Cap Growth team. He joined William Blair & Company in 1993. From 1997 to 2010, he was also a Portfolio Manager for the Large Cap Growthteam. Previously, John was Director, Investments, Equity Portfolio Manager, and Venture Capital Funds Manager with TRW, Inc. for 10 years. Prior to that, he was an Assistant Trust Officer,Equity Fund Manager, and Research Analyst with Boatmens National Bank for five years. He is a member of the CFA Institute, the CFA Society of Chicago, and past President of the PilgrimVillage Board of Trustees. He is a Trustee of the Chancellors Society at the University of Missouri and a Director of the Easter Seals of DuPage and the Fox Valley Region. He is also Director ofthe Board of the CFA Society of Chicago. Education: B.A., Economics, University of Missouri; M.B.A., Finance, University of Michigan.Robert C. Lanphier, PartnerRob Lanphier is a Portfolio Manager on the Mid Cap Growth and Small-Mid Cap Growth teams. He co-founded the Mid Cap Growth strategy in 1997 and the Small-Mid Cap Growth strategy in1998. Rob has extensive experience in the Industrials sector and previously served as the Industrials Sector Team Leader. Prior to that, he was with William Blairs sell-side institutionalsales group for eight years. He joined William Blair & Company in 1987. Prior to joining the investment industry, Rob was with Emerson Electric Corporation for nearly six years. Education:B.S., Purdue University; M.B.A., Northwestern University Kellogg Graduate School of Management.Matthew A. Litfin, Partner, CFAMatthew Litfin is a Portfolio Manager on the Small-Mid Cap Growth team. He joined the team in 2007 as a dedicated analyst before becoming a portfolio manager in 2008. Matthew joinedWilliam Blair & Company in 1997 as a Research Analyst, and in 2004 became the Group Head of Business Services research within William Blair & Companys sell-side research department.Matthew was twice named Best on the Street in The Wall Street Journals annual analyst survey. Previously, he was a municipal bond analyst with John Nuveen & Company.Education: B.S., Finance, summa cum laude, University of Tennessee Knoxville; M.B.A., Harvard Business School.Todd M. McClone, Partner, CFATodd McClone joined William Blair & Company in 2000 as part of the International Growth Team. He is the lead portfolio manager for the William Blair Emerging Leaders and EmergingMarkets Small Cap Growth strategies and is a portfolio manager for the Emerging Markets strategy. Previously, he was a senior research analyst specializing in international equity forStrong Capital Management. Prior to joining Strong Capital Management, he was a Corporate Finance Research Analyst with Piper Jaffrey. At Piper Jaffray, he worked with the corporatebanking financials team on a variety of transactions including initial public offerings, mergers and acquisitions and subordinated debt offerings as well as issued fairness opinions andconducted private company valuations. Education: B.B.A. and B.A. University of Wisconsin Madison.David Merjan, Partner, CFADavid Merjan joined William Blairs International Growth Team in 1998. He serves as a portfolio manager for the International Developed Plus and ADR strategies. Prior to joining WilliamBlair, David was with Hughes Electronics in Los Angeles in various capacities, including the Corporate Treasury department where he focused on international mergers and acquisitions andmanaged corporate currency and interest rate portfolios as well as in the pension management subsidiary of Hughes where he managed an international equity fund. Education: B.A.,Dickinson College; M.I.M., American Graduate School of International Management. David has the Chartered Financial Analyst designation and is a member of the CFA Institute.David Ricci, Partner, CFADavid Ricci is a Portfolio Manager on the Mid Cap Growth and Large Cap Growth teams. He joined the Mid Cap Growth team in 2005 and the Large Cap Growth team in 2011. Previously, hewas the Group Head for the Consumer sector, focusing on Specialty Retail and E-commerce companies, in William Blairs sell-side research group. David joined William Blair & Company in1994. Prior to joining the investment industry, he had extensive experience with Procter & Gamble, Melville, and Bain & Company. Education: Sc.B., magna cum laude, Brown University;M.B.A., Harvard Business School.Jeffrey A. Urbina, Partner, CFAJeff Urbina joined William Blair & Company in 1996 as part of the International Growth Team. He oversees International Small Cap and Emerging Markets strategy and research and is thelead portfolio manager for the William Blair International Small Cap Growth and Emerging Markets Growth strategies and is a portfolio manager for the Emerging Leaders and EmergingMarkets Small Cap Growth strategies. Previously, he was a Senior Vice President and Portfolio Manager of the Van Kampen American Capital Navigator Fund, an emerging market equityfund listed on the Luxembourg exchange. While at Van Kampen, he also served as the Director of Research and was a member of the Investment Policy Committee for the firm. Prior tojoining Van Kampen in 1991, Jeff spent almost 15 years in the commercial banking business with Citibank where he was a Vice President and Senior Relationship Manager in the banks realestate group, and with Harris Bank in Chicago where he was an International Banking Officer. Education: B.A., Northwestern University; M.M., Northwestern University Kellogg GraduateSchool of Management.48155498 49. BiographiesClient Service - US:John V. McLaughlin, Partner, CFAJohn McLaughlin is the Head of Institutional Client Relationships. He joined William Blair & Company in his current role in 2004. Previously, John was with Brinson Partners/UBS Global Asset Management for 14 years.Prior to that, he was an advisor on structured financed and leveraged buy-outs with the former First Chicago Corporation for 10 years. Education: B.A./M.A., University of Nebraska; M.B.A., Arizona State University.Robert J. Duwa, CFARobert Duwa is a Senior Client Relationship Manager. He joined William Blair & Company in his current role in 2010. Previously, Bob was a senior consultant and practice leader with DeMarche Associates Inc. for 11years. While at DeMarche, Bob was also president of Discretionary Management Services a registered investment advisor. Prior to that, he was in client service and marketing roles for First Chicago and BoatmensTrust Company. He is a member of the CFA Society of Chicago. Education: B.A. Finance, Loras College.Douglas J. Kryscio, CFADoug Kryscio is a Senior Client Relationship Manager. He joined William Blair & Company in his current role in 2011. Previously, Doug was a Partner and Midwest and Great Lakes Market Business Leader with MercerInvestment Counseling for 11 years. While at Mercer, Doug was also a Senior Analyst, Associate and Principal. Prior to that, he was a Portfolio Manager for First Chicago. He is a member of the CFA Institute and the CFASociety of Chicago. Education: B.B.A. Finance, Department Honors, University of Kentucky; M.B.A., Finance, Graduated with Distinction, DePaul University, Phi Kappa Phi and Delta Mu Delta National Honor Society.Julie Stevens, CFAJulie Stevens joined William Blair & Company in 2000 as a member of Investment Managements Operations Team. She is the Head of Client Services. She has been a member of the Client Services Team since May of2004. Previously, she spent three years at Bank One as a Financial Analyst for the Asset Liability Management Department. She is a member of the CFA Society of Chicago and the Association for InvestmentManagement and Research. Education: B.S., Indiana University (1995); M.B.A., University of Chicago Booth School of Business.Cliff KalishCliff Kalish is a Senior Client Service Associate. He joined William Blair & Company in his current role in 2011. Previously, Cliff was a Client Relationship Manager at Calamos Investments for six years. Prior to that, Cliffwas a Research Analyst at Ellwood Associates for five years. Cliff is a Level II Candidate in the CFA program. Education: B.S. in Consumer Economics with option in Finance, University of Illinois (1999).Megan SchlesingerMegan Schlesinger joined William Blair & Company in 2010 as a Senior Client Service Associate. As a member of the Institutional Client Relationship team, she is responsible for clients invested in the firmsinstitutional equity strategies. Previously, she spent three years at Advisory Research, Inc., in client services. Megan is a Level II Candidate in the CFA program, member of the CFA Society of Chicago, and member ofEmpowering Womens Network. Education: B.S. Finance, minor in International Studies, Graduated with Distinction, The Pennsylvania State University.Lizett TernesLizett Ternes joined William Blair & Company in 2008 as a member of the Client Services Team. She is a primary contact for custodial relationships and is responsible for facilitating all aspects of client fundings andcash flows. B.A., Posse Scholar, Denison University in Ohio.Audrey DanielsAudrey Daniels joined William Blair in 2011 as a member of Investment Managements Institutional Client Service Team. She is a Client Service Associate, responsible for both international and domestic accounts.Previously, she has held multiple client service positions at Citadel and UBS, and more recently supported institutional accounts as a Portfolio Administrator for Mesirow Financial. Audrey holds the NASD Series 7 andSeries 66 licenses. Education: B.B.A. in Economics, University of Iowa; M.A.T. in Secondary Teaching, National Louis University.Dana DenizmanDana Denizman joined William Blair & Company in 1999 as a member of the Small Cap Growth Team. Currently, she is responsible for client service, and has been a member of the Client Services Team since May 2004.Previously, she spent four years at PaineWebber in various positions, including Registered Sales Assistant, Branch Office Administrator and in the Management Development Program. Prior to that, Dana spent fouryears at American Century as a Client Service Representative. B.A., University of Iowa (1991).Client Service Europe:Thomas Ross, PartnerTom Ross is the Head of European Institutional Distribution. He joined William Blair & Company in 2007. Previously, Tom was a Managing Director at bfinance International for seven years. Prior to that, he was amanagement consultant with McKinsey & Company. Education: B.A., University of Manchester; M.B.A., INSEAD.Reto Baruffol, PartnerReto Baruffol is responsible for institutional marketing and client service on the European continent. He began this role in 2007. Previously, he served as an Institutional Sales Representative for William Blairs sell-side brokerage and research group. He joined William Blair & Company in 1995. Previously, Reto was an Assistant Manager with Brown Brothers Harriman in New York and Zurich for four years. Education: M.B.A.,Marketing and Management, Zurich University.Stefan Hess, CIIAStefan Hess is responsible for institutional client service on the European continent. He joined William Blair & Company in 2010. Previously, he worked as a Senior Investment Consultant with Complementa for threeyears. Prior to that, he headed the investment controlling team at Swiss Life after joining from Accenture, where he worked as a Business Consultant in the Financial Services Industry Group. He started his industrycareer as Portfolio Control Officer at Julius Baer Asset Management. Education: M. Sc. in Management, Technology and Economics from Swiss Federal Institute of Technology (ETH), Zurich. 49 202887 50. BiographiesSystematic Research:Spiro VoulgarisSpiro Voulgaris joined William Blair & Company in 2007 as a Senior Quantitative Analyst in the Investment Management division of the firm. He brings to the firm approximately 15 yearsexperience as a quantitative analyst and strategist. Prior to joining the firm, Spiro was a Senior Quantitative Analyst with Neuberger Berman for five years and subsequently workedalongside the same investment professionals for an additional 3 years while with the Northern Trust. He was also with Lehman Brothers for six years where he was a Strategist andQuantitative Analyst for their global and U.S. Investment Strategy teams in London and New York. Education: B.A., Economics, University of Chicago; M.B.A., with a concentration in Statisticsand International Finance, University of Chicago Booth School of Business.Steven J. EnglehardtSteve Englehardt joined William Blair & Company in 2011 as a Quantitative Resources Analyst. He is responsible for implementing quantitative models developed by the QuantitativeResearch Team. He acts as the liaison between the Quantitative Research Team and users of quantitative research. Prior to joining the firm, Steve was a Consultant and Product Developer atFactSet Research Systems in Boston and Norwalk, CT. Education: B.A. Economics, Boston College. He is a Level III CFA candidate.Andrew Kominik, CFAAndrew Kominik joined William Blair & Company in 2003. After serving as a marketing analyst and portfolio construction analyst, Andrew moved into his current role, quantitative portfolioanalyst, in 2007. He primarily supports equity management teams in the use of internal and external quantitative models to evaluate portfolio risk and performance. Andrew also developsand programs multifactor quantitative models that are used by the fundamental equity analysts and portfolio managers. He also holds a CFA charter. Education: B.A., History, BrandeisUniversity, magna cum laude; M.B.A., with concentrations in Econometrics & Statistics and Finance, University of Chicago Booth School of Business.Strategy Research:Melissa McGrane, CFAMelissa McGrane joined William Blair & Company Investment Management in 2001 and has been in her current role as a quantitative strategy analyst since 2007. She joined the researchteam in 2004 as a research associate focusing on companies in the consumer and financial sectors. Previously, she spent three years as a fixed income associate within the department.Melissa received her CFA charter in 2004. Education: B.S. in Economics and Business Administration, Coe College, magna cum laude; M.B.A., University of Chicago Booth School of Business.Olga PomerantzOlga Pomerantz joined William Blair & Company in 2009. She is responsible for economic research across all regions and sectors. Prior to joining the firm, Olga was a Senior Economist at theNational Institute of Economic and Social Research in London, UK, where she was responsible for macroeconomic forecasting and thematic research projects for international organizationsand government bodies. Education: B.A., University of Chicago; M.S.c Economics, London School of Economics and Political Science. 50 204989 51. Glossary - TermsAlpha : A measure of a portfolios return in excess of the market return, after both have been adjusted for risk. It is a mathematical estimate of the amount of return expected from a portfolio above and beyond themarket return at any point in time. For example, an alpha of 1.25 indicates that a stock is projected to rise 1.25% in price in a year over the return of the market, or the return when the market return is zero.When an investment price is low relative to its alpha, it is undervalued, and considered a good selection.Beta : A quantitative measure of the volatility of the portfolio relative to the overall market, represented by a comparable benchmark. A beta above 1 is more volatile than the overall market, while a beta below 1 isless volatile, and could be expected to rise and fall more slowly than the market.Developed Markets : Using the Morgan Stanley Capital International (MSCI) geographic definition, this region includes: United Kingdom, Europe (Austria, Belgium, Denmark, Finland, France, Germany, Greece,Ireland, Italy, Netherlands, Norway, Spain, Sweden and Switzerland), Japan, Pacific Asia (Australia, Hong Kong, New Zealand, and Singapore) and the Western Hemisphere (Canada and other Americas).Debt to Total Capital Ratio: This figure is the percentage of each companys invested capital that consists of debt. Companies with a high Debt to Total Capital level may be considered more risky. From a portfolioperspective, the portfolio Debt to Total Capital Ratio is a weighted average of the individual holdings Debt to Total Capital Ratio.Emerging Markets : Using MSCIs geographic definition, this region includes: Emerging Markets Asia (China, India, Indonesia, Malaysia, S Korea, Taiwan, and Thailand), Emerging Markets Europe, Mid-East andAfrica (Czech Republic, Hungary, Poland, Russia, Turkey, Egypt, Morocco, and S Africa), and Latin America (Argentina, Brazil, Chile, Columbia, Mexico, Peru and Venezuela).EPS (Earnings Per Share) Growth Rate (Projected): This measure represents the weighted average of forecasted growth in earnings expected to be experienced by the stocks within the portfolio over the nextyear. From a portfolio perspective, the portfolio EPS Growth Rate is a weighted average of the individual holdings EPS Growth Rate.EV/EBITDA : (Enterprise Value / Earnings Before Interest, Taxes and Depreciation-Amortization) : The EV/EBITDA ratio is useful for global comparisons because it ignores the distorting effects of individualcountries taxation policies. Its used to find attractive takeover candidates. Enterprise value is a better measure than market cap for takeovers because it takes into account the debt which the acquirer will have toassume. Therefore, a company with a low EV/EBITDA ratio can be viewed as a good takeover candidate.EV/IC : (Enterprise Value / Invested Capital) Ratio : Enterprise Value (EV), which is market capitalization minus cash plus debt divided by Invested Capital (IC), which is the sum of common stock, preferred stockand long-term debt. This number will get you a simple multiple. If it is below 1.0, then it means that the company is selling below book value and theoretically below its liquidation value.Information Ratio: A measure of risk-adjusted return. The annualized excess return of the portfolio relative to a respective benchmark, divided by the annualized tracking error relative to that same benchmark.The higher the measure, the higher the risk-adjusted return.PBVn : (Price/Book Value) Ratio : The PBV Ratio measures the value of a companys common stock relative to its shareholders equity. A price-to-book multiple above one means that the price of the companyscommon stock is higher than its common shareholders equity. A price-to-book multiple below one means that the price of the companys common stock are less than its break-up value, and the shares may beundervalued.PCF : (Price/CashFlow) : Some analysts favor the price/cash flow over the price-earnings (PE) ratio as a measure of a companys value. Cash flow is a measure of a companys financial health. It equals cashreceipts minus cash payments over a given period of time.P/E : (Price/Earnings) Ratio : This is the most common measure of how expensive a stock is. Simply, it is the cost an investor in a given stock must pay per dollar of current annual earnings. A high P/E generallyindicates that the market is paying more to obtain the stock because it has confidence in the companys ability to increase its earnings. Conversely, a low P/E often indicates that the market has less confidencethat the companys earnings will increase rapidly or steadily, and therefore will not pay as much for its stock.R-squared : A measurement of how closely the portfolios performance correlates with the performance of its benchmark, such as the MSC AC World Free ex US Index. In other words, it is a measurement of whatportion of a portfolios performance can be explained by the performance of the overall market or index. Ranges from 0 to 1, where 0 indicates no correlation and 1 indicates perfect correlation.Risk (Standard Deviation): A measure of the portfolios risk. A higher standard deviation represents a greater dispersion of returns, and thus a greater amount of risk. The annualized standard deviation iscalculated using monthly returns.Sharpe-Ratio : A risk-adjusted measure calculated using standard deviation and excess return (Portfolio return Risk Free Rate) to determine reward per unit of risk. The higher the Sharpe ratio, the better theportfolios historic risk-adjusted performance.Tracking Error : Tracking Error measures the extent to which a portfolio tracks its benchmark. The tracking error of an index portfolio should be lower than that of an active portfolio. The tracking error willalways be greater than zero if the portfolio is anything other than a replication of the benchmark.Trailing 1-Year Turnover: This figure reflects the portfolios trading activity by calculating the amount of the portfolios holdings bought or sold over the prior year, expressed as a percentage of the portfoliosaverage market value. Turnover figures may be related to the amount of trading costs experienced by the portfolio.Weighted Average Market Capitalization: Market capitalization refers to the total market value of each companys outstanding shares. The Weighted Average Market Capitalization for a portfolio is calculated asthe average market capitalization of the stocks within the portfolio, weighted by the amount of each stock owned.Weighted Median Market Capitalization: This calculation represents the median market capitalization of the stocks in the portfolio, weighted by the amount of each stock owned.51 29451 52. Glossary IndicesBarclays Capital Aggregate Bond Index (formerly the Lehman Index): composed of securities from the Barclays Aggregate Government/Corporate Bond Index, Mortgage-Backed Securities Index, and Asset-BackedSecurities Index.Barclays Capital Intermediate Govt./Credit Bond Index (formerly the Lehman Index): Fixed-rate government and corporate bonds rated investment grade or higher.Merrill Lynch 1-Year U.S. Treasury Note Index: comprised of a single U.S. Treasury Bill issued at the beginning of each month and held for a full month. Each month the index is rebalanced and the issue selected is theoutstanding U.S. Treasury Note that matures closest to, but not beyond one year from the rebalancing date.Merrill Lynch 3-Month Treasury Bill Index: An unmanaged index tracking 3-month U.S. government securities.MSCI: (Morgan Stanley Capital International): MSCI indices are the most widely used benchmarks by global portfolio managers. MSCI offers international investors performance benchmarks for 51 national stockmarkets as well as regional, sector, industry group, and industry aggregations.MSCI All Country World ex-US EAFE Index: an unmanaged index that includes developed and emerging markets outside the United States.MSCI All Country World ex-US Small Cap Index: a free float-adjusted market capitalization index designed to measure global developed and emerging market small capitalization equity performance, excluding the U.S.MSCI EAFE IMI Index: a free float-adjusted market capitalization index that is designed to measure equity market performance in the developed markets outside the United States.MSCI All Country World ex-US Index: an unmanaged index that includes developed and emerging markets.MSCI All Country World ex-US IMI Index: a free float-adjusted market capitalization index that is designed to measure equity market performance in the global developed and emerging markets, excluding the US.MSCI All Country World IMI Index: a free float-adjusted market capitalization index that is designed to measure equity market performance in the global developed and emerging markets.MSCI All Country World ex-US IMI Growth Index: a free float-adjusted market capitalization index that is designed to measure equity market performance in the global developed and emerging markets, excluding theUS. It includes those MSCI All Country World ex-US IMI Index securities with higher price-to-book ratios and higher forecasted growth rates.MSCI World ex-US Growth Index: a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed markets, excluding the U.S., with higher price-to-book ratios and higher forecasted growth rates.MSCI World ex-US Index: a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed markets, excluding the U.S.MSCI All Country World ex-US Small Cap Index: a free float-adjusted market capitalization index designed to measure global developed and emerging market small capitalization equity performance, excluding the U.S.MSCI Emerging Markets IMI Index: a free float-adjusted market capitalization index that is designed to measure equity market performance in the global emerging markets.MSCI Emerging Markets Small Cap Index: a free float-adjusted market capitalization index that is designed to measure equity market performance of small cap companies in emerging markets.MSCI Emerging Markets Large Cap Index: a free float-adjusted market capitalization index that is designed to measure equity market performance of large cap companies in emerging markets.MSCI World ex-US Small Cap Index: an unmanaged index that includes non-US developed markets.Russell 1000 Index: Measures the performance of the 1000 largest companies in the Russell 3000 Index, which represents approximately 90% of the total market capitalization of the U.S. market.Russell 1000 Growth Index: Measures the performance of those Russell 1000 companies with higher price-to-book ratios and higher forecasted growth values.Russell 1000 Value Index: Measures the performance of the large cap value segment of the U.S. equity universe. It includes those Russell 1000 companies with lower price-to-book ratios and lower forecasted growthvalues.Russell 2000 Index: Measures the performance of the 2000 smallest companies in the Russell 3000 index, which represents approximately 8% of the total market capitalization of the Russell 3000 index.Russell 2000 Growth Index: Measures the performance of those Russell 2000 companies with higher price-to book ratios and higher forecasted growth values.Russell 2000 Value Index: Measures the performance of those Russell 2000 companies with lower price-to-book ratios and lower forecasted growth values.Russell 2500 Index: Measures the performance of the 2500 smallest companies in the Russell 3000 Index.Russell 2500 Growth Index: Measures the performance of those Russell 2500 companies with higher price-to book ratios and higher forecasted growth values.Russell 2500 Value Index: Measures the performance of those Russell 2500 companies with lower price-to book ratios and lower forecasted growth values.Russell 3000 Index: Measures the performance of the 3000 largest U.S. companies based on total market capitalization, which represents approximately 98% of the investable U.S. equity market.Russell 3000 Growth Index: Measures the performance of those Russell 3000 companies with higher price-to-book ratios and higher forecasted growth values.Russell Midcap Index: Measures the performance of the 800 smallest companies in the Russell 1000 Index, which represent approximately 27% of the total market capitalization of theRussell 1000 companies.Russell Midcap Growth Index: Measures the performance of those Russell Midcap companies with higher price-to-book ratios and higher forecasted growth values.Russell Midcap Value Index: Measures the performance of the mid-cap value segment of the U.S. equity universe. It includes those Russell Midcap Index companies with lower price-to-book ratios and lower forecastedgrowth values.S&P 500 Index: A measure of domestic equity market performance published by Standard & Poors. It consists of 400 leading industrial issues, 20 transportation issues, 40 utilities and 40 finance issues weighted on amarket capitalization basis. The S&P 500 is a broad-based index composed of domestic stocks representing 80% of the market value of all stocks traded on the New York Stock Exchange.A direct investment in an unmanaged index is not possible.5229452 53. Composite Disclosure Global Growth Composite Total Total Composite Assets Composite YearGross Net Returnacwimi netCompositeBenchmark Number of End ofPercent Non- Assets to Total Ending Asset-Wtd. Asset-Wtd.Benchmark 3-Yr St Dev3-Yr St DevPortfoliosDispersionPeriod(MM)Fee PayingFirm Assets12/31/2007*16.00% 15.44% 0.90%N/AN/A5/FewerN/A $143.29 0.00% 0.00% 12/31/2008 -49.50%-50.03% -42.34%N/AN/A5/FewerN/A $130.22 0.00% 0.50% 12/31/200943.10% 41.67%36.41%N/AN/A5/FewerN/A $202.89 0.00% 0.55% 12/31/201022.11% 21.14%14.35%25.93% 24.87% 5/FewerN/A $309.78 0.00% 0.70% 12/31/2011-2.47%-3.25% -7.89%18.76% 20.86% 5/FewerN/A $1,277.12 0.00% 3.10%Disclosures:William Blair Investment Management claims compliance with the Global Investment Performance Standards (GIPS) and has prepared and presented this report in compliance with theGIPS standards. William Blair Investment Management has been independently verified for the periods January 1, 1993 through December 31, 2010. Verification assesses whether (1) thefirm has complied with all the composite construction requirements of the GIPS standards on a firm-wide basis and (2) the firms policies and procedures are designed to calculate andpresent performance in compliance with the GIPS standards. The Global Growth composite has been examined for the periods presented through December 31, 2010. The verification andperformance examination reports are available upon request. For purposes of compliance with GIPS, the Firm is defined as all accounts managed by William Blair InvestmentManagement, which is the money management operation of William Blair & Company, LLC. William Blair & Company, L.L.C. is an investment adviser registered with the United StatesSecurities and Exchange Commission(SEC). Registration with the SEC does not imply a certain level of skill or training.Global Growth invests in a broad range of companies based in foreign developed and emerging markets and the United States. The benchmark that best reflects the compositesinvestment strategy is the MSCI All Country World Investable Market Index (IMI) Net, which is a free float-adjusted market capitalization index that is designed to measure equity marketperformance, net of withholding taxes, in the global developed and emerging markets.Portfolio and composite returns are calculated daily. Prior to January 1st, 2009, portfolio returns were calculated monthly using a time-weighted monthly linked return formula withadjustments for cash flows and composites were calculated monthly by weighting portfolio returns based on beginning of month market value. Valuations and returns are denominatedin U.S. Dollars. Accrual accounting is used for dividends. The dividend accruals included in portfolio valuations are net of applicable withholding taxes. Pending withholding tax reclaimsare not accrued for in the portfolio valuations. Portfolios must have an initial market value greater than or equal to $1 million to be included in the composite. New accounts are added tothe composite at the beginning of the month following the first full calendar month under management. Portfolios will be excluded from the composite the first month immediatelyfollowing their last complete month of authorized management by the Firm.Composite dispersion measures represent the consistency of a firms composite performance with respect to the individual portfolio returns within a composite. The dispersion of annualreturns is measured by the asset-weighted standard deviation of the returns in the composite. Dispersion includes only those portfolios that have been included in the composite for theentire year. This eliminates any inaccuracies created by annualizing partial year returns. The three-year annualized standard deviation measures the variability of the composite and thebenchmark returns over the preceding 36-month period. This statistic is not presented until there are 36 months of performance available. Performance results are stated gross and netof investment advisory fees. The management fee schedule is as follows, effective January 2010:First $20,000,000 0.80%Next $30,000,0000.60%Next $50,000,0000.50%Next $50,000,0000.45%Next $50,000,0000.40%Over $200,000,000 0.30%The maximum fee is 0.800%.The Global Growth Composite was created in July 2007. A complete list and description of firm composites is available upon request. Additional information regarding policies for valuingportfolios, calculating performance and preparing compliant presentations is also available upon request. * Partial period represents data from 7/1/2007. 53 153488 54. Composite Disclosure International Growth All Cap GrowthTotal Total Composite Assets Composite