McIntire Investment Institute At the University of Virginia

1. McIntire Investment Institute At the University of Virginia Portfolio Update Prepared by MII Managers| 3 September 2008

2. Changes to Portfolio(Approved, Not Yet Completed) • Closed long position in Intuitive Surgical • Opened long position in Phillip Morris International

3. MII Portfolio ~ $425,000

4. American Express (AXP) • American Express is a leading global provider of payment and travel services to consumers, small businesses and large corporations • Reasons for having AXP in MII portfolio: • Greatest growth potential of major credit cards • Highest spending, most valuable customers • Dominates prestige card market with $20.9Bn brand • Strong business model / management

5. Global investment management firm • Fixed income, cash management, equity, alternatives • Risk management analytics: BlackRock Solutions ($7 trillion) • Acquisition of Barclays Global Investors • Adds $1.5 trillion to BLK’s $1.3 trillion AUM • Significant access to retail investors with iShares ETF • BLK shares up 115% in the last 6 months • Up 11% since acquisition of Barclays Global Investors

6. User Focused Design Philosophy • Superior Technology • Large Cash Position • Human Capital • Open-Source Development • Attractive Valuation • Growth of Cloud Computing • Development of White Space

7. Brand Equity • Strong Growth • Effective Management • Product Expansion • High Margins/Operational Efficiency • 64% Handbags, 28% Accessories • 80% Direct-to-Consumer (58% US, 19% Japan)

8. Diageo • Successful Growth • Mobile Marketing Plan • Well Known and High Grossing Brands

9. “The SAT measures nothing but a student’s ability to take it” • New Management • Strong Brand Name and Effective Products • International Potential • Highly Favorable Test Preparation Market

10. Global provider of agricultural products • Seeds, biotechnology traits, herbicides • Increasing top and bottom line growth • Increases in food demand • Dietary shifts: more protein = more meat = more seeds • R&D Spending • 10% of total Revenues • Robust Pipeline • Management • Aggressive: Cotton and Wheat

11. MII added CVA in 2008 • CVA is composed of the National American Insurance Company of California and an energy subsidiary that focuses on Energy-from-Waste (EfW) solutions • EfW involves burning trash to generate electricity. Heavy metals are extracted and recycled. • Its solid waste combustion process generates clean electricity and results in a net greenhouse gas reduction • Environmental Protection Agency VAR: • CVA is an industry leader and EfW capacity could double in the U.S. • It is cheaper for most municipalities to use landfills • It is unlikely CVA will qualify to sell carbon credits under recent cap-and-trade legislation • The federal government classifies EfW as a renewable energy source

12. Designer and manufacturer of Global Positioning System (GPS) products for precision farming • Precision Farming focuses on sound crop production by applying geo-technology to effectively understand and manage the dynamic flows and cycles within a landscape perspective • Thesis Points: • Strong growth play based on trends towards precision agriculture in farming across the US and international markets • Turnaround play – Hemisphere GPS emerged as a niche precision agriculture player from CSI wireless, which was a generic GPS manufacturer • Winning new contracts with important OEM players like AGCO • Adoption Rates of precision agriculture are high

13. Strong International growth potential via excellent brand making • China • Strong Management • Healthy financial status

14. Short position at $64 • Significant exposure to retail • High level of debt • Subpar customer services • Why holding it still? • Do not believe in consumption comeback • High unemployment • Declining Commercial Property Value • Overall Equities Correction

15. MII shorted 200 COCO shares on 1/23/09 and 110 additional shares on 4/13/09 • COCO is a private post-secondary education company • VAR shows that: • Past and current students believe COCO exaggerates its graduate placement rates and starting salaries • A former student and the California Attorney General have sued the company for misleading students • Annual faculty and staff turnover is nearly 50% • COCO has assumed the credit risk of subprime students denied federal loans • Shares have jumped from ~$16.00 on 8/1/09 to $19.32 • Short interest is 17% (as of 8/15/09)

16. The Pep Boys—Manny, Moe & Jack • Serial Money Loser • Imprudent Management • Identity Crisis • Macro Trends

17. Markets nutritional shakes, dietary pills, and creams through a network of individual distributors • VAR with doctors and biology professors reveals the products are no better than over-the-counter multivitamins and supplements • Short thesis points include: • Misleading marketing • Expensive fad products • Low quality business in economic downturns • Limited long-term growth potential due to distribution methods