The Target Small Company Growth Index is a focused measurement of the small growth sector of the market. Companies listed in this index are small capitalization companies. These companies have above average earnings and sales growth histories, although this growth need not be as steady over longer periods required of a larger company. Companies that do not fall clearly into the defined growth category are eliminated. These companies typically have higher than average returns on equity and levels of profitability and often pay little or no dividends.

• Derived from the Target Next 1750 Universe.
• Security choice is based on the relative evaluation of fundamentals such as sales growth, return on equity, and earnings growth.
• All criteria are relative so that the index is not affected by the changing levels of these measures during different market periods.
• Changes in the index occur quarterly to ensure that the portfolio always reflects the best configuration for the style.

• Orientation of the index is one that eliminates those companies that do not fit the growth criteria, as opposed to establishing explicit cutoffs for each measure.

• The index is readjusted quarterly.
• A security will be excluded from the index when it stops trading.
• Shares outstanding may be adjusted to reflect corporate events during the quarter; otherwise, shares outstanding are updated once per quarter.