CapitalMarketsUpdateFall2002

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					Emerging Growth Markets Wither in the
            Summer of 2002
Capital Markets Overview
How Bad Is It?

$$$$                Wall Street Bonuses

       RIDICULOUS


 $$$
                                               CAPITAL
                           OUTRAGEOUS          CALLS !
  $$


   0
       1998         1999         2000   2001     2002




   $                                                     2
                                                         2
The Capital Markets Slump Continues
   The Technology and Health Care markets have been severely impacted by the
    global economic slowdown, disappointing corporate earnings, widespread
    accounting fraud, geopolitical instability and declining consumer
    confidence
   The NASDAQ at 1,382 is at its May 1997 levels and the Dow at 8,639 is back
    to where it was in January 1999
   Between 1997 and 2001, the average annual number of Technology and Health
    Care M&A transactions was 539 and 181; the current annual run rate is 254
    and 132, representing a 53% and 27% decline; M&A activity is back to 1996
    levels
   Between 1997 and 2001, the average annual number of Technology and Health
    Care IPO transactions was 178 and 48; the current annual run rate is 28 and
    24, representing an 84% and 50% decline; IPO activity is back to 1990
    levels
   We expect Q3 2002 to produce lower levels of Technology and Health Care
    activity than Q2 2002
   Most new issues completed in 2002 disappointed investors, which we expect
                                                                            3
    to prompt greater scrutiny for IPOs in the 2nd half                    3
Why No Emerging Growth Turnaround in 2002?

    Global economic outlook remains uncertain particularly as the U.S. is
     experiencing a lackluster recovery

    Other leading economies including Japan, Germany and France remain
     weak

    Corporate leaders, still stinging from weak customer demand, over
     capacity, plummeting stock prices, accounting uncertainties and
     shareholder hostility, are reluctant to invest ahead of the recovery
     and are therefore contributing to its weakness

    Consumers and government deficit spending is strong but looks maxed
     out

    Low interest rates remain a strong stimulus but can not go much lower




                                                                             4
                                                                             4
Emerging Growth Banker’s Wish List

    Stable valuations compelling buyers to act

    Tangible pickup in global economic growth

    Meaningful pickup in end-customer demand

    Stability/Profitability/Predictability in buyer and seller financial
     results

    Rapid cleansing of the fraudulent and aggressive accounting practices

    Overall improvement in business and consumer confidence

    And, of course, the Red Sox to win the World Series !




                                                                             5
                                                                             5
Emerging Growth Markets Will be Back
    Innovation, new technology and products will continue to be a core
     driver of global productivity gains and commerce

    Enormous amounts of capital currently sitting in cash will seek out
     higher returns in new companies with compelling value propositions

    There is a vast amount of human capital (academia, venture backers,
     ex-dot-com boomers) determined to drive entrepreneurial efforts

    The U.S. Government continues to be a catalyst to the Emerging
     Growth Markets with low interest rates, low inflation, low capital
     gains taxes, defense related R&D spending and various technology
     and small business subsidizations

    Darwinism is currently rationalizing our markets and will reduce
     the number of competitors in technology, health care and investment
     banking and thus ultimately create a healthier business environment

                                                                           6
                                                                           6
SG Cowen: Boutique Committed to Emerging
Growth Markets
   As has been true for over 30 years, SG Cowen has a strong research
    franchise with over 60 research professionals covering the growth sectors
    of health care, consumer and technology

   Over 100 investment banking professionals and roughly 500 employees
    focused purely on these growth markets

   Offices in New York, Boston, San Francisco, Dallas, London, Paris

   Strong sales and      trading   engine   supporting   our   institutional   and
    corporate clients

   Dedicated product teams for IPO, F-O, M&A, converts, PIPEs, private
    placements, high yield and senior debt

   Société Générale as one of the top global banks is a great parent and
    partner of SG Cowen



                                                                                      7
                                                                                      7
SG Cowen Remains Active in Difficult Times
   Equity Capital Markets achievements
       SG Cowen has been a manager on 6 of the 10 largest transactions in Health Care
        and Technology over the last twelve months including
          $2.5 B IPO for Alcon
          $1.9 B Follow-on for Accenture
          $1.8 B Convert for Lucent
          $800 mm Follow-on for L-3


   Completed M&A assignments
       Triquint acquisition of Sawtek for $1.3 billion
       Informix sale of database business to IBM for $1 billion cash
       Cephalon acquisition of Group Lafon for $450 million
       Emerson sale of ENI business to MKS Instruments for $313 million

   Private Placement and PIPEs Transactions
       Altus Biologics $51 million private placement
       Aradigm $48 million PIPEs offering
       Xanboo $14 million private placement
                                                                                         8
                                                                                         8
Q2 2002 Had Even Lower Levels of Activity
than Q1 2002

 Summary of Market Activity in Technology and Health Care
                                                     Num ber of T r ansact ions                           T ot al T r ansact ion Value
                                        Q1 2 0 0 2           Q2 2 0 0 2           % Change   Q1 2 0 0 2            Q2 2 0 0 2            % Change

T echnology
  M&A Transactions                           73                  54                 (26)%    $ 9,446              $14,701                   56%

  IPOs                                        5                    8                 60%          664                  630                  (5)%

  Follow-ons                                 21                  10                 (52)%       3,041               3,346                   10%

  Convert ibles                              17                    2                (88)%       3,489                  200                 (94)%

  PIPEs                                      14                  13                  (7)%       5,919               4,467                  (25)%

Healt h Car e
  M&A Transactions                           38                  28                 (26)%    $ 5,455               $9,773                   79%

  IPOs                                        3                    9                200%        2,522               1,126                  (55)%

  Follow-ons                                 15                  11                 (27)%       1,900               1,090                  (45)%

  Convert ibles                               8                    4                (50)%       4,725               1,813                  (62)%

  PIPEs                                       8                    8                  0%          279                  260                  (7)%




          U.S. transactions with deal values > $20MM.
                                                                                                                                                    9
                                                                                                                                                    9
          Dollar values shown are US$ in millions.
2002 Activity Reverts to the Levels of the
Mid ‘90s

 Summary of Market Activity in Technology and Health Care
                                                                                    Hist or ical Equiv alent
                                            1996        2000   2001   2 0 0 2 (a)   (Year / T r ansact ions)

T echnology
  M&A Transactions                           268        819    393      254              1996/ 268
  IPOs                                       274        262     20        26              1990/ 34
  Follow-ons                                 141        201     45        62              1994/ 70
  Convert ibles                               30         74     60        38              1997/ 57
  PIPEs                                         3        21     27        54              2002/ 54

Healt h Car e
  M&A Transactions                           180        181    142      132              1994/ 141
  IPOs                                       146         82     24        24              1999/ 26
  Follow-ons                                 147         71     59        52              1994/ 47
  Convert ibles                               25         32     28        24              1998/ 18
  PIPEs                                       13         63     45        32              1999/ 24




          U.S. transactions with deal values > $20MM.
          Dollar values shown are US$ in millions.                                                             10
                                                                                                               10
          (a) Annualized results.
  Technology Capital Markets Mature
  •2002 Total Transaction value is 4.7x larger than in 1992
  •Expect M&A to become the exit strategy of necessity
                                                                 Technology Transactions
                                                                                                  2002

                                                                                                IPOs
                                                                                                 3%
        1992                                                                          Follow -ons
                                                                                         14%
       I POs
        22%                                                                      Conv er ts
                                                                                   8%
                        M&A
Fol l ow -ons           46%
     16%                                                                            PIPEs
                                                                                    22%                      M &A
       Conv er t s
         16%                                                                                                 53%

       $26B


           Source: Equidesk and SDC.                                                               $92B(a)          11
                                                                                                                    11
           (a) Annualized H1 2002 Technology Transaction Value
Health Care Markets Have Experienced a
Similar Trend
•Total Transaction value is 3.9x larger than in 1992
•Financing alternatives such as converts and PIPEs gain popularity
                                                                 Health Care Transactions
                                                                                                       2002

                                                                                                   IPOs
       1992                                                                                        13%

     I POs                                                                          Follow -ons
      26%                                                                              10%
                      M&A
                      43%
Fol l ow -ons
     25%
             Conv er t s                                                              Conv er ts                    M &A
               6%
                                                                                        22%                         53%
      $16B                                                                                         PIPEs
                                                                                                    2%



          Source: Equidesk and SDC.
                                                                                                          $63B(a)          12
                                                                                                                           12
          (a) Annualized H1 2002 Health Care Transaction Value
NASDAQ Continues Its Journey South!
 – How Bad Would it Be Without the 73% Rate Cut?

(NASDAQ Index)                                                         Per cent  Since Fir st Rat e Cut                    (Interest Rate)

                                                                                  1/ 2/ 2001    7/ 15/ 2002    %
                                                       NASDAQ Composite                2,292           1,383    (40%)
       3,000                                           10-yr US Treasury Rate           4.91%          4.56%     (7%)            7.0%
                                                       Federal Funds Rate               6.50%          1.75%    (73%)

                                                                                                                                 6.0%

       2,500

                                                                                                                                 5.0%
                                                                                                                                  10-yr Treasury (4.56%)


       2,000                                                                                                                     4.0%



                                                                                                                                 3.0%

       1,500
                                                                                                                                  NASDAQ (1,383)

                                                                                                                                 2.0%

                                                                                                                                  Fed. Funds (1.75%)

       1,000                                                                                                                     1.0%
           Jan-01        Mar-01        May-01         Jul-01     Sep-01      Nov-01      Jan-02     Mar-02     May-02   Jul-02




                                                                                                                                              13
     Source: FactSet based on market close July 15, 2002.                                                                                     13
Valuations are Almost 2x Higher than Pre-Bubble
                                                                                        Rising Valuation Levels
                                                                                 1 0 Year Median         7/ 15/ 2002
              (Rev. Mult.)                         S&P LTM Revenue Multiple           2.4x                   3.2x       (Inter est Rate)
                                                   10-yr US Treasury Rate             6.0%                  4.6%
             6x                                                                                                                9.0%

                                                                                                                               8.0%
               5
                                                                                                                               7.0%

               4                                                                                                               6.0%

                                                                                                                               5.0%
               3
                                                                                                                               4.0%

               2                                                                                                               3.0%

                                                                                                                               2.0%
               1
                                                                                                                               1.0%

               0                                                                                                               0.0%
                   6/ 1992     9/ 1993 12/ 1994 3/ 1996                     6/ 1997    9/ 1998 12/ 1999 3/ 2001        6/ 2002

  Source: FactSet based on market close July 15, 2002.
  S&P LTM Rev. Multiple charts all current members of index, not historical index.
                                                                                                                                           14
                                                                                                                                           14
       Are U.S. Equities Still Overvalued?

       • In order to reach pre-bubble multiples, the S&P 500, which is currently at
         920, would have to fall to roughly 800 based on forward P/E or as low as
         500 based on LTM Revenue Multiple


                      S&P 5 0 0 LT M Rev M u l ti p l es                                 S&P 5 0 0 For w ar d P/ E M u l ti p l es

5.0x                                                                 30.0x
                                      4 .6 x
4.5x
                                                                                                             2 4 .8 x
                                                                     25.0x
4.0x

3.5x                                                                                                                                 1 9 .8 x
                                                            3 .1 x   20.0x
3.0x                                                                          1 6 .2 x
2.5x                                                                 15.0x

2.0x
            1 .6 x
                                                                     10.0x
1.5x

1.0x
                                                                      5.0x
0.5x

0.0x                                                                  0.0x
          1995-1996                   2000                  7/ 02            1995-1996                       2000                     7/ 02

           Pre-                                                               Pre-
                                  Bubble                   Crash                                           Bubble                    Crash
          Bubble                                                             Bubble



                                                                                                                                                15
                                                                                                                                                15
Trading Volume Remains Flat
(Indexed Volum e)                                  Daily Aver age T r ading Volume      (In billions)

                                                                   2001                         2002
 250
                                                          Q1     Q2       Q3     Q4          Q1      Q2
                                         NASDAQ            2.1    1.9      1.6    1.8         1.8     1.8
                                         NYSE              1.2    1.2      1.2    1.3         1.4     1.4


 200




 150




 100




  50




   0
   Jan-01                            May-01                         Sep-01                              Jan-02   May-02


       Source: FactSet based on market close of July 15, 2002.                                                            16
                                                                                                                          16
U.S. Venture Investments in Technology Have
Steadily Decreased During 2000 and 2001
                              Venture Investments in Technology and Health Care

      (US$ in billions)                          Technology                     Health Care
       $20
                 $15            $15        $14
                                                         $12
        10                                                            $7           $6              $5          $4          $3
                         $2           $2         $2            $2          $1           $2              $1          $2          $1
          0
                  Q1 00         Q2 00      Q3 00         Q4 00         Q1 01       Q2 01           Q3 01       Q4 01        Q1 02


      (US$ in billions)
       $60                                                                                   $56


        40
                                                                            $28
                                                                                                             $22
        20                                                     $11                                                        $12
                                                                                                   $9              $6
                  $4 $2          $5 $3           $2 $1               $3           $5                                            $4
          0
                   1995           1996           1997           1998            1999          2000            2001          2002
                                                                                                                         Annualized
   Source: VentureOne.                                                                                                                17
                                                                                                                                      17
IPO Market Remains Comatose in 2002
                                                  Technology                        Health Care
   (# of IPOs)
    120
              97
      90                                   75
                            56
      60                                          36
      30            15            18                         15 14
                                                                         5   4           5   3          4    5         6 13          5     3      8   9
       0
               Q1 0 0        Q2 0 0         Q3 0 0           Q4 0 0      Q1 0 1          Q2 0 1         Q3 0 1         Q4 0 1        Q1 0 2       Q2 0 2



   (# of IPOs)
    400                                                                                                     357

    300                                                                                                                 243
                                                                  224
                                                       196
    200                                                                146   152
                          123          102                                                   113
             91 108                                          76                     76                                          83
    100                         59           57
                                                                                                   28             26                 20 25        26 24
       0
               1992         1993         1994           1995          1996        1997        1998           1999        2000            2001     2002
                                                                                                                                                Annualized


 Source: EquiDesk as of June 30, 2002.
 Note: Best efforts, rights offerings, units and closed end funds are excluded. Technology group excludes telecommunications services companies.
                                                                                                                                                             18
                                                                                                                                                             18
Health Care IPO Market Is Stronger Than Tech But
Weak From a Historical Perspective
                                                          Technology       Health Care
        (US$ in millions)


         $8,000

           7,000
                       $5,918
           6,000

           5,000

           4,000
                                                                            $2,918
           3,000                                                                        $2,522
                                                             $1,893
           2,000
                                                                                                    $1,126
           1,000                              $769                                   $664        $630
                                                                  $463   $555
                                 $318                 $319
                 0
                            Q1 01                 Q2 01        Q3 01       Q4 01       Q1 02       Q2 02



  Source: EquiDesk as of June 30, 2002.
  Note: Best efforts and Rights offerings are excluded.                                                      19
                                                                                                             19
                          Q1 01                             Q2 01                             Q3 01                           Q4 01 YTD


Fall in IPO Filings Diminish Hope for a Q3
Rebound
                                                  New Filings                                Withdrawals

                                                                    Technology
        (# of IPOs)
        120
                97
        100                         84                         79
                                           75
         80                                                                61
                               56
         60                                       49
         40                                                                             27
                    14                                   15                                           14
         20                                                            5            5            4            6 10         5       2       6       2
           0
                Q1 00          Q2 00        Q3 00        Q4 00        Q1 01        Q2 01        Q3 01         Q4 01       Q1 02         Q2 02


            (# of IPOs)                                             Health Care
            40                               36

            30
                                18
            20      15               14                   14                                                13 12
                                                                           12
                                                                9                        9                                             7
            10            4                        4                   4                         5    6                                        4
                                                                                    3                                     3    3
              0
                    Q1 00        Q2 00       Q3 00        Q4 00        Q1 01       Q2 01        Q3 01        Q4 01        Q1 02        Q2 02


 Source: EquiDesk as of June 30, 2002.
 Note: Best efforts and Rights offerings are excluded. Technology group excludes telecommunications services companies.
                                                                                                                                                       20
                                                                                                                                                       20
Profile of 2002 Technology IPOs
               IPO Requirements for the first half of 2002
                   Revenue growth of 25% or better
                   Revenue run rate of $40M or better
                   Profits not required
                   Couple of quarters with financial visibility
               Ugly aftermarket performance will result in tougher standards for Fall 2002

                                                                                                                                     Financials as of IPO D at e
                                                                                                                                                            LQ          Year to Year
                                                             M ar k et   Am ount      Cur r ent   Af ter m ar k et          LQA      LQA Rev .          Oper ating       Quar ter ly
Com pany                            Sector                    Cap.       Of f er ed    Pr ice     Per f or m ance         Rev enue    M ult.              Pr of it      Gr ow th Rate

T echnology IPOs
  1 PayPal Inc                      Int ernet                   $1,398         $70         $23                 78%            $162             3.8 x           (47)%             357 %
  2 Net flix                        Int ernet                      349          83          16                   7%            122             2.5             (13)%              79
  3 Verint Syst ems                 Comm.                          227          72           9               (41)%             145             2.6                 6%              5
  4 Synapt ics Inc                  Comm.                          191          55           7               (32)%             106             2.3               16%              43
  5 Overst ock.com                  Int ernet                      178          39          13                 (0)%             48             3.8             (23)%              26
  6 Plumt ree Soft ware             Soft ware                      117          43           4               (47)%              93             2.4                 2%             24
  7 Alt iris Inc.                   Soft ware                      108          50           5               (47)%              46             3.9             (14)%              79
  8 Print cafe Soft ware            Soft ware                       50          38           5               (53)%              47             2.9             (69)%              23
    M edian                                                      $184          $53          $8              (4 1 )% (a)        $99             2 .8 x         (1 3 )%             35 %

D ef ense IPOs
  1 Ant eon Int ernat ional Corp    IT Services (Defense)         $746        $270        $20                 10%             $721             1.1 x               2%             18 %
  2 Veridian Corp                   IT Services (Defense)          631         216         20                 25%              706             1.3                 7%              9
  3 Int egrat ed Defense Tech       Elect ronics (Defense)         437         154         21                 (4)%             299             2.0                 5%              2
  4 SRA Int ernat ional             IT Services (Defense)          266          90         24                 31%              306             0.7               (1)%             (1)
  5 Mant ech Int ernat ional Corp   IT Services (Defense)          190         115         20                 28%              461             1.0                 7%             18
     M edian                                                      $437        $154        $20                 25%             $461             1 .1 x             5%               9 %




      Source: Equidesk and FactSet. Market Cap. and current price based on market close July 15, 2002 all other financials based on IPO date.
      (a) Median of Afermarket Performance excludes PayPal Inc.
                                                                                                                                                                                        21
                                                                                                                                                                                        21
Profile of Health Care 2002 IPOs
            Health Care IPO Activity is Mildly Better than Technology
                Door remains open for Medtech and Services and only slightly for Biotech
            Health Care IPO Requirements
                Strong revenue growth is required
                Revenue run rate depends on sector
                Profitability generally required


                                                                                                                          Financials as of IPO D at e
                                                                                                                                               LQ         Year to Year
                                                      M ar k et   Am ount      Cur r ent   Af ter m ar k et      LQA      LQA Rev .        Oper ating      Quar ter ly
Com pany                           Sector              Cap.       Of f er ed    Pr ice     Per f or m ance     Rev enue     M ult.           Pr of it     Gr ow th Rate

Health Car e IPOs
 1 Alcon                           Medt ech              $9,412      $2,302        $30                (10)%      $2,684           3.8 x             23%              8 %
 2 Ribapharm Inc                   Biot ech/ Pharma         884         260          6                (41)%         228           6.6               85%             95
 3 CTI Molecular                   Medt ech                 771         182         18                    6%        221           3.7                2%             37
 4 Eon Lans Inc                    Biot ech/ Pharma         656         147         16                    4%        193           3.4               29%             23
 5 Medical St affing Net work      Services                 605         148         20                    5%        413           1.7                5%             46
 6 Kyphon Inc                      Medt ech                 453          90         12                (20)%          58           9.4              (9)%            133
 7 Inveresk Research Group         Biot ech/ Pharma         393         156         10                (25)%         213           3.1                2%            233
 8 MedSource Technologies Inc.     Medt ech                 316         100         12                    0%        153           2.5               10%             37
 9 Zymogenet ics Inc               Biot ech/ Pharma         240         120          7                (45)%          20          20.3            (260)%            (57)
10 Comput er Programs & Syst ems   HCIT                     181          50         20                  21%          68           3.8               17%             25
11 Quint on Cardiology Syst ems    Medt ech                 100          28          9                  24%          33           2.6             (14)%              6
12 DOV Pharmaceut ical Inc         Biot ech/ Pharma          57          65          4                (71)%           3          69.8            (334)%             70
   M edian                                                $423        $134         $12                 (5 )%      $173            3 .8 x             3%             37 %




     Source: Equidesk and FactSet. Market Cap. and current price based on market close July 15, 2002 all other financials based on IPO date.

                                                                                                                                                                          22
                                                                                                                                                                          22
      Follow-On Market Shows Some Life Then Fades
  (US$ in millions)
     $40,000    $35,011                                           Technology                     Health Care

      14,000


      12,000


      10,000

                                                                           $8,128
       8,000            $7,248
                                   $7,068
                                                   $6,775
                                                                  $6,260
       6,000
                                                                                                                              $4,834

       4,000                                                                                                                                                       $3,346
                                                                                    $2,973                                                       $3,041
                                                                                                        $2,342
                                                                                             $1,292                                                       $1,900
       2,000                                                                                                   $1,376
                                         $864                                                     $1,137              $864                                              $1,090
                                                           $703

           0
                    Q1 00             Q2 00           Q3 00            Q4 00             Q1 01        Q2 01         Q3 01            Q4 01            Q1 02           Q2 02




# of offerings         100    27              32   12 29      7                17   24           11   10       12     14             11      9             13   24
21    15          10     11

           Source: EquiDesk as of June 30, 2002.
           Note: Data excludes block trades and spot secondaries. Technology group excludes telecommunications services companies.
                                                                                                                                                                              23
                                                                                                                                                                              23
  Convertible Market Loses Steam
(US$ in millions)                                        Technology                          Health Care
 $16,000       $15,215

  14,000

  12,000

  10,000                                                                                                                       $9,201

                                                                                   $7,735
    8,000
                            $6,083              $6,272
                                                              $5,834                             $5,578          $5,650
    6,000             $5,224                                                                                                                     $4,725
                                                                                                          $3,832                            $3,489
    4,000                                                                                                                 $3,237        $3,100
                                                                           $2,018                                                                           $1,813
    2,000                                                $1,634
                                         $474                                                                                                             $200
                                                                                        $200
        0
                 Q1 00              Q2 00            Q3 00             Q4 00         Q1 01          Q2 01           Q3 01           Q4 01       Q1 02      Q2 02


# of offerings 38     19            11           2                14       4            11   7              13      1              13    11          10          5
                      24       11           17       8                 2       4

     Source: Equidesk as of June 30, 2002.
     Note: Technology group excludes telecommunications services companies.
                                                                                                                                                                 24
                                                                                                                                                                 24
PIPEs Have Arrived and Are Here to Stay
                                                   Technology              Health Care
(# of Tr ansact ions)
30         26

                                                                                                     19
20                                        16
                                                         13                                               14        14       13
                                                                                   12        12
10                    7     8         7                               7                                                  8        8
        5                                                                  5
                                                    2             8                      2
 0
       Q1 00         Q2 00            Q3 00        Q4 00      Q1 01        Q2 01         Q3 01       Q4 01          Q1 02     Q2 02




(# of Tr ansact ions)                                                                             63
60                                                                                                                           54
                                                                                                                    45
40                                                                                                                                32
                                                                                    24                         27
                                                                                             21
20                               13                 12                11
                                               8                               8
        2      1           3                                  2
 0
         1995               1996               1997           1998             1999           2000              2001          2002
                                                                                                                             Annualiz ed

     Source: Equidesk and SG Cowen.
                                                                                                                                           25
                                                                                                                                           25
M&A Overview
Today’s M&A Activity
    Merger of Like Size Public Companies
         Fair Issac / HNC Software; Oplink Communications / Avanex

    Merger of Private Companies

    Selected Strategic Acquisitions by sector leaders
         Cisco / Navarro; Boston Scientific / BEI Medical; Cadence / Simplex; CIENA / ONI

    Corporate Divestitures
         Amdocs / Clarify (Nortel) ; IBM / Informix (Ascential); MKS Instruments / ENI
          (Emerson); Francisco Partners / Global eXchange Services (GE)

    Going Private Transactions
         Deltek Systems

         Expect many poorly performing public companies to go private in the next 18
          months



                                                                                             27
                                                                                             27
In This M&A Environment, There Are Many
Obstacles To Overcome
   Management teams are focused internally on minimizing disruption
    and damage from the down cycle

   The confidence level of boards of directors and management teams
    has declined dramatically

   Even post-handshake agreement, many transactions are being called
    off due to volatility in stock prices and problems in due
    diligence

   Companies are guarding their cash more zealously than before —
    the next financing is expensive and no longer assured

   Institutional reaction to M&A transactions has been at best
    skeptical

   Investors generally want companies to focus on their operations
    and core competencies rather than acquiring uncertain revenue
    growth
                                                                        28
                                                                        28
What the Future Holds
   M&A volume in 2002 will be substantially lower than 2001
   M&A transactions by public acquirors will continue to be highly scrutinized by
    the market
   Going forward, 70% of M&A deals will be between $20-$200 million, which is
    much smaller than the world grew accustomed to for M&A
   Companies will continue to focus on strategic targets that quickly add
    accretive value and complement the acquirors’ current product offering
   Earnings and growth visibility will return, decision makers’ confidence will
    improve, and M&A activity will be firmly rooted in fundamentals
   Large buyout shops will become meaningful participants in the next wave of M&A
   During the mid ‘90s, there was a 1 to 1 ratio of M&A to IPO exits; expect
    this ratio to increase to 3 to 1 over the next 18 months as M&A proves to be
    the exit mode of necessity
   There will be a modest Technology M&A rebound beginning in Q4 2002 which will
    accelerate as we move into 2003 as most market segments have too many
    competitors
                                                                                    29
                                                                                    29
Tech M&A Becomes the Exit of Necessity
          (# of Tr ansact ions)                  Technology Transactions 1992–2002
          1,000
                                             # of Tech IPOs                  # of Tech M&A Transactions
                                                                                                                       852


            750
                                                                                                           684




            500
                                                                                               444
                                                                                                                                  393
                                                                                                     357
                                                                                   322
                                                                                                                 243                          254
            250                                                    224 230
                                                       196
                                                             168             152
                                123              121                                     113
                     91                    102
                          52          78
                                                                                                                             25          26
               0
                      1992        1993      1994       1995         1996      1997        1998        1999        2000       2001         2002
                                                                                                                                        Run Rate


 Source: SDC and Equidesk. New Issues & M&A Transactions over $20MM. Rights offerings and Best efforts are excluded.
 Note: All data as of June 30, 2002.                                                                                                                30
                                                                                                                                                    30
Tech M&A Activity Continues Its Fall
                                                         Tech M&A Transactions
(# of Tr ansact ions)
          294
300
                            212
200                                        181
                                                          165
                                                                                                                   129
                                                                         106             96            105
100                                                                                                                           73
                                                                                                                                          54

  0
           Q1 00          Q2 00          Q3 00          Q4 00          Q1 01          Q2 01          Q3 01         Q4 01     Q1 02      Q2 02


(# of Tr ansact ions)
                                                                                                     852
900
                                                                                684
600
                                                           444                                                        393
                                     322
                230                                                                                                                    254
300


  0
               1996                 1997                  1998                 1999                 2000              2001            2002
                                                                                                                                     Run Rate
      Source: SDC: M&A Transactions over $20 MM. Based on announcement date of January 1, 1996 to June 30, 2002.

                                                                                                                                                31
                                                                                                                                                31
Over the Last Several Years, IPOs Have Taken a
Back Seat to M&A in Health Care
                                                Health Care Transactions 1992–2002
       (# of Tr ansact ions)
                                             # of Health Care IPOs                  # of Health Care M&A Transactions
       250



                                                                                 198         201
       200
                                                                                                         182           181

                                                                 162

       150                                                144 146                                                             142
                                                                                                                                          132
                                             117
                 108
       100
                                                                                                                83
                                  76                 76                     76
                       71
                             59         57
         50
                                                                                        28          26                       25      24


           0
                  1992        1993       1994        1995        1996        1997        1998       1999        2000         2001    2002
                                                                                                                                    Run Rate
 Source: SDC and Equidesk. New Issues & M&A Transactions over $20MM. Rights offerings and Best efforts are excluded.
 Note: All data as of June 30, 2002.                                                                                                            32
                                                                                                                                                32
Health Care Transaction M&A Activity is
Erratic
                                                   Health Care M&A Transactions
 (# of Tr ansact ions)
 60           51                                                                          51
                                            46              46
                             38                                            37                                                   38
 40
                                                                                                                    29                      28
                                                                                                         25
 20


  0
           Q1 00           Q2 00          Q3 00          Q4 00          Q1 01          Q2 01           Q3 01       Q4 01       Q1 02      Q2 02



(# of Tr ansact ions)
250
                                      198                   201
200                                                                              182                   181
                162
                                                                                                                         142             132
150
100
 50
  0
               1996                  1997                  1998                 1999                  2000            2001               2002
                                                                                                                                       Run Rate
      Source: SDC: M&A Transactions over $20 MM. Based on announcement date of January 1, 1996 to June 30, 2002.


                                                                                                                                                  33
                                                                                                                                                  33
M&A Market Activity By Sector in H1 2002
                                          H1 2 0 0 2 Num ber of T r ansactions by Sector
                                 Health Car e                            T echnology
                                   Biotech/ Pharma                  16      Software              37
                                   Medtech                          10      Internet              15
                                   HCIT                              4      Electronics           26
                                   Services                         36      IT Services           19
                                                                    66      Communications        30
                                                                                                 127

                Health Care                                                                     Technology



                               Biot ech/ Phar m a
                                      24%                                            Com m unicat ions           Sof t war e
                                                                                           24%                     29%
        Ser v ices
          55%
                                         M edt ech
                                           15%                                           IT Ser v ices             Int er net
                                                                                             15%                     12%

                                   HCIT
                                    6%                                                           Elect r onics
                                                                                                     20%




  Source: SDC.                                                                                                                  34
  Based on number of U.S. transactions with deal values > $20 MM.                                                               34
The Majority of H1 2002 M&A Transactions
are Under $100 MM
                                           H1 2 0 0 2 Num ber of T r ansactions by Value
                                                              Health Car e         T echnology
                                  $20 MM - $99 MM                           39                 79
                                  $100 MM - $199 MM                         11                 22
                                  $200 MM - $499 MM                          7                 16
                                  $500 MM - $999 MM                          6                  4
                                  $1B+                                       3                  6
                                                                            66               127


                  Health Care                                                           Technology
                        1 B+                                                                1 B+
                         4%                                                                  5%
                                                                                  500 MM - 999 MM
      500 MM - 999 MM
                                                                                        3%
            9%

                                                                         200 MM - 499 MM
 200 MM - 499 MM
      11%                                                                     13%


  100 MM - 199 MM
       17%                                                               100 MM - 199 MM            2 0 M M -9 9 M M
                                    2 0 M M -9 9 M M                                                      62%
                                          59%                                 17%




    Source: SDC.
    U.S. transactions with deal values > $20MM.                                                                        35
                                                                                                                       35
Billion $ Deals are Harder to Find

      (# of
 Tr ansactions)
                                            Technology             Health Care
 80
                                                                                           75

 70

                                                                                 61
 60


 50


 40                                                                    36


 30


 20                                                                         18                       17
                                       14           15            15                            15
                                                             13                       13                  13
                                  11
 10                                         8            8                                                      8
                              4                 5
         2                2                                                                                         3
             0
  0
         1992             1993    1994      1995    1996     1997      1998      1999      2000      2001      H1 2002




                                                                                                                         36
                                                                                                                         36
           Source: SDC.
2001 and 2002 Billion $ Deals
2001 Technology                                                                                       2001 Health Care
(US$ in millions)                                                                                     (US$ in millions)
            Ann.                                                                            Deal                   Ann.                                                                                D eal
            Date    T ar get                             Acquir or                          Value                  D at e      T ar get                            Acqui r or                          Value

 1     08/ 06/ 01   Hughes Elect roni cs Corp            EchoSt ar Communicat ions Corp    $ 31,738        1     12/ 17/ 01    Immunex Corp.                       Amgen Inc.                          $ 16,679
 2     09/ 04/ 01   Compaq Comput er Corp                Hewlet t -Packard Co                25,263        2     03/ 27/ 01    ALZA Corp.                          Johnson & Johnson                     12,117
 3     08/ 01/ 01   Cooper Indust ries Inc               Danaher Corp                         6,965        3     06/ 07/ 01    DuPont Pharmaceut icals             Brist ol-Myer s Squi bb Co.            7,800
 4     07/ 16/ 01   SCI Syst ems Inc.                    Sanmina Corp                         6,336        4     03/ 19/ 01    Bergen Brunswig Corp.               AmeriSour ce Healt h Corp.             3,805
 5     03/ 28/ 01   GE American Communi cat ions         Societ e Europeene Sat ellit es      4,929        5     05/ 30/ 01    Mini Med Inc.                       Medt ronic Inc.                        3,300
 6     01/ 29/ 01   Dallas Semiconduct or                Maxim Int egrat ed Product s         2,653        6     05/ 30/ 01    C.R. Bard, Inc.                     Tyco Int ernat ional Lt d.             3,094
 7     07/ 24/ 01   Lucent Tech-Opt ical Fibre Unit      Furukawa Elect ri c Co Lt d          2,525        7     12/ 06/ 01    Cor Therapeut ics, Inc.             Millenium Pharmaceut icals, Inc.       2,102
 8     08/ 03/ 01   Sensormat ic Elect ronics Corp       Tyco Int ernat ional Lt d            2,311        8     04/ 20/ 01    VISX Inc.                           Carl Icahn                             1,649
 9     12/ 17/ 01   Alpha Indust ri es Inc               Conexant Syst ems Inc-Wirel ess      2,159        9     12/ 03/ 01    Aviron                              MedImmune, Inc.                        1,604
10     05/ 07/ 01   NOVA Corp                            US Bancorp, Minneapolis, MN          2,026       10     10/ 17/ 01    Right Choice Managed Care           Well Point Healt h Net works Inc.      1,347
11     01/ 08/ 01   Server Wor ks                        Broadcom                             1,740       11     05/ 23/ 01    Inver ness Medi cal Technology      Johnson & Johnson                      1,336
12     02/ 22/ 01   Ef f icient Net works                Siemens                              1,464       12     11/ 20/ 01    CareFi rst Blue Cross Blue Shield   Well Point Healt h Net works Inc.      1,320
13     05/ 15/ 01   Sawt ek Inc                          TriQui nt Semiconduct or Inc         1,312       13     04/ 02/ 01    Unilab Corp.                        Quest Diagnost ic                      1,178
14     09/ 24/ 01   Illuminet Holdings Inc               VeriSign Inc                         1,257
                                                                                                                                                                                Median                 $2,102
15     06/ 11/ 01   Remedy Corp                          Peregrine Syst ems Inc               1,218
16     01/ 17/ 01   WebTrends                            Net IQ                               1,031
17     04/ 24/ 01   Inf ormix Sof t ware Inc             IBM Corp                             1,000

                                                                     Median                $2,159



2002 Technology                                                                                       2002 Health Care
(US$ in millions)                                                                                     (US$ in millions)
     Ann.    Date   T ar get Name                          Acquir or Name                  Deal           Ann.     Date       T ar get Name                        Acquir or Name                      Deal
                                                                                           Value                                                                                                       Value
1      02/ 22/ 02   TRW Inc                                Nort hrop Grumman Corp            $6,810   1        04/ 29/ 02     Trigon Healt hcare Inc               Ant hem Inc                           $3,981
2      05/ 31/ 02   Expedia Inc                            USA Int eract ive                  2,081   2        04/ 02/ 02     Unilab Corp                          Quest Diagnost ics Inc                 1,178
3      04/ 17/ 02   IBM Corp-Hard Disk Drive               Hit achi Lt d                      2,050   3        06/ 14/ 02     Syncor Int ernat ional Corp          Cardinal Healt h Inc                   1,096
4      03/ 08/ 02   Elant ec Semiconduct or Inc            Int ersil Corp                     1,432
                                                                                                                                                                             Median                     $1,178
5      04/ 08/ 02   Dat ek Online Holdings Corp            Amerit rade Holding Corp           1,361
6      01/ 14/ 02   Rayt heon Co-Aircraf t Int grt ion     L-3 Communicat ions Hdgs           1,130
7      05/ 31/ 02   Ticket mast er                         USA Int eract ive                  1,122
8      05/ 31/ 02   Hot els.com(USA Int eract ive)         USA Int eract ive                  1,015
                                                                     Median                  $1,396


                                                                                                                                                                                                               37
                                                                                                                                                                                                               37
Technology Leaders Continue to Fall
                                                                   % of Pr ice
                                          M ar k et                 Change       LQA Rev enue          Cur r ent        Net
         Com pany                           Cap.                      YT D          M ult .             Pr ice          Cash
         Microsof t                            $280,521               (22)%                   8.3 x              $52    $38,693
         Hitachi                                204,315               (16)%                   2.0                  61    (9,491)
         Intel                                  127,836               (39)%                   4.4                  19     9,372
         IBM                                    121,544               (41)%                   1.9                  71   (20,941)
         Cisco                                  105,651               (20)%                   5.0                  14     8,971
         Nokia                                     66,231             (43)%                   2.2                  14     5,021
         Dell                                      66,001             (6)%                    1.9                  25     3,440
         AOL Time Warner                           58,197             (59)%                   2.2                  13   (27,625)
         Oracle                                    55,736             (27)%                   5.6                  10     5,542
         Applied Materials                         31,915             (3)%                    6.0                  19     4,163
         EMC                                       20,233             (32)%                   3.4                   9     2,285
         Sun                                       18,475             (54)%                   1.4                   6         793
         EDS                                       16,909             (49)%                   1.0                  35    (4,143)
         Fujitsu                                   14,051             (2)%                    1.6                  36   (13,514)
         Ericsson                                  12,744             (70)%                   0.9                   2    (1,533)
         NEC                                       11,428             (33)%                   0.6                   7   (14,757)
         Lucent                                       9,217           (57)%                   0.7                   3      (246)
         Yahoo                                        7,808           (26)%                   9.1                  13         805
         Alcatel                                      7,717           (62)%                   0.7                   6    (2,957)
         SAP                                          5,985           (40)%                   0.9                  19         560
         Computer Associates                          5,827           (62)%                   3.0                  13    (2,662)
         Nortel                                       4,456           (81)%                   0.5                   1    (1,279)
         Median                                $ 1 9 ,3 5 4          (4 0 )%                  2 .0 X             $14      $157


  All prices as of market close July 15, 2002.                                                                                      38
  Market Cap. In US$ millions; Net Cash in US$ millions = Cash -                                                                    38
  Debt.
Accordingly, the Tech Leaders’ M&A Pace
Remains Slow in 2002
                         # of M&A Deals Announced

                         Com pany                   2000   2001   H1 2 0 0 2
                         Cisco                       27      3       2
                         Intel                       18      6       1
                         Microsoft                   11      4       4
                         SAP                          9      4       2
                         AOL Time Warner              9      9       4
                         Lucent                       9      0       0
                         Nortel                       9      1       0
                         Sun                          8      4       1
                         Computer Associates          5      0       1
                         Yahoo                        7      3       3
                         Alcatel                      6      6       2
                         IBM                          4      6       2
                         Nokia                        4      3       0
                         EDS                          3      7       0
                         EMC                          3      2       0
                         Ericsson                     4      2       0
                         Hitachi                      4      7       8
                         Fujitsu                      8      4       2
                         NEC                          3      9       0
                         Applied Materials            2      4       0
                         Oracle                       0      1       2
                         Dell                         0      0       1
                                                    153     85       35        39
  As of June 30, 2002.
                                                                               39
Tech M&A Premiums Drop Dramatically

                              Premiums 4 Weeks Prior to Announcement Date


             T ech n olog y                                          H ealt h Car e

80%                                                80%
      66%            67%
70%                                                70%
60%                                                60%                       51%      53%
50%                                                50%      47%

40%                                                40%
                                      27%
30%                                                30%
20%                                                20%
10%                                                10%
0%                                                  0%
      2000          2001              2002                  2000            2001      2002




                                                                                             40
                                                                                             40
What Does All This Mean When Considering a
Sale
In the most hostile M&A environment in 15 years, the outright
sale of your company should only be pursued if:

    a)   You have no choice
    b)   An unsolicited approach generates a compelling
         opportunity
    c)   Buyer interest, strength of your company, and other
         facts support such a conclusion



Expect the buyers to slowly return and the market to improve
late this year / early next year

                                                                41
                                                                41
Test Buyer Interest With a Few Calls
In the current environment, it may be best to make a few [5]
discrete calls to the most obvious buyers to rapidly assess
market interest:

 It is important that the buyer feel the “Company is not being
  auctioned”
 Limits senior management involvement, resources, particularly
  emotional energies and expectations
 If needed, you can quickly turn off process with limited drain
  on the enterprise




                                                               42
                                                               42
Health Care Activity Details
Follow-On and Biotech Offerings are the
Leaders in the 2002 Health Care Market
                                                      Capital Markets
           By type of                                                                                     By Sector
           offering
                                                                                                          HCIT
                               Equity-                                                             HCS     5%
          PIPEs                Linked                                                              18%
          24%                                                                                                         Biophar m
                                18%                                                                                       a
                                            IPOs                                                                         53%
                                             18%                                                  Med Tech
                  Follow-                                                                           24%
                   Ons
                   40%




                                            Average Aftermarket Performance
                                   (% change)           IPOs                    Follow-Ons
                                      0

                                     (5)
                                                         (5)%
                                   (10)
                                                                                   (10)%
                                   (15)
                        # of offer ings                     12                            26


   Source: SG Cowen, SDC and EquiDesk as of June 30, 2002.
   Note: Best efforts, rights offerings, block trades, spot secondaries, unit and closed -end funds are excluded.
   Aftermarket Performance based on closing price of July 15, 2002.                                                               44
                                                                                                                                  44
Summary of 2002 and 2001 U.S. Health Care
New Issues
                                                                         H1 2002

New Issues by T ype                                                               New Issues by Sector
                    # of        Aftermarket         Total         Median                                 # of      Aftermarket          Total          Median
Issue Type          Deals       Performance         Value         Value            Deal Type             Deals     Performance          Value          Value
IPO                   12             (5)%          $ 3,648        $134             BioTech/ Pharma        35             (2)%          $ 7,498         $ 60
Convert               12             —               6,538         200              MedTech               16            (16)             3,448           75
PIPE                  16             —                 538          32             HCS                    12             (2)             2,418          142
Follow-on             26            (10)             2,990          79             HCIT                    3             15                420           70
     Total            66             (6)%          $ 13,193       $ 78                   Total             66               (6)%       $ 13,193        $ 78




                                                                           H1 2001

New Issues by Type                                                                New Issues by Sector
                     # of      Af t er m ar k et     T ot al      M edian                                 # of     Af t er m ar k et      T ot al       M edian
Issue T ype         Deals      Per f or m ance       Value         Value           Deal T ype            Deals     Per f or m ance        Value          Value
IPO                    24             25%          $ 3,587         $ 90            BioTech/ Pharma
                                                                                            Pharm a        88                 5%        $ 12,517          $ 84
Convert                28             —             10,368          300            MedTech                 29                 4            5,084            68
PIPE                   45             —              1,556           30            HCS                     36                27            7,148           124
Follow-on              59             12             9,179          114            HCIT                     3                 2              211            56
     T ot al         156              10%          $ 2 4 ,9 6 0    $ 92                  T ot al          156                10%        $ 2 4 ,9 6 0      $ 92


   Source: SDC and Equidesk. Aftermarket Performance based on closing price of July 15, 2002. All Deal Values/Proceeds in                                       45
   millions.                                                                                                                                                    45
Summary of 2002 U.S. Health Care New Issues
 BioTech/Pharma                                                                                  MedTech
                                                                      Af ter m ar k et                                                                              Af ter m ar k et
       Issuer                               Pr oceeds   Of f er ing   Per f or m ance                 Issuer                              Pr oceeds   Of f er ing   Per f or m ance
  1    Amgen Inc                               $3,500   Convert                          -        1   Alcon Inc                              $2,302   IPO                          (7)   %
  2    IDEC Pharmaceut icals Corp               1,138   Convert                          -        2   Fisher Scientific Intl                    193   Follow0n                   (73)    %
  3    Medicis Pharmaceut ical Corp               350   Convert                                   3   CTI Molecular Imaging Inc                 182   IPO                         11     %
  4    Ribapharm Inc                              260   IPO                      (41)        %    4   Wright Medical Group Inc                   92   Follow0n                   (85)    %
  5    Abgenix Inc                                200   Convert                      -            5   Kyphon Inc                                 90   IPO                        (15)    %
  6    Charles River Laborat ories                185   Convert                      -            6   Conmed Corp                                81   Follow0n                   (16)    %
  7    Inveresk Research Grp Inc                  156   IPO                      (15)        %    7   SangStat Medical Corp                      78   Follow0n                   (59)    %
  8    OSI Pharmaceut icals Inc                   150   Convert                      -            8   Advanced Neuromodulation                   78   Follow0n                   (16)    %
  9    Eon Labs Inc                               147   IPO                        2         %    9   Conceptus Inc                              73   Follow0n                   (16)    %
 10    First Horizon Pharmaceut ical              141   Follow0n                  43         %   10   PhotoMedex , Inc.                           0   PIPE                           -
 11    Isis Pharmaceut icals Inc                  125   Convert                      -           11   Sonosite Inc                               47   Follow0n                   (19)    %
 12    Zymogenet ics Inc                          120   IPO                      (45)        %   12   IGEN International, Inc.                   37   PIPE                           -
 13    Thorat ec Corp                             112   Follow0n                 (38)        %   13   Inverness Medical Innovations Inc          37   Follow0n                   (29)    %
 14    Int erMune Inc                             111   Follow0n                   6         %   14   EPIX Medical, Inc.                         32   PIPE                           -
 15    Amylin Pharmaceut icals Inc                 84   Follow0n                 208         %   15   Array Biopharma Inc                        30   Follow0n                    87     %
 16    Ligand Pharmaceut icals, Inc.               69   PIPE                         -           16   Quinton Cardiology Systems                 28   IPO                         19     %
 17    DOV Pharmaceut ical Inc                     65   IPO                      (71)        %        M edian                                   $75                             (1 6 )   %
 18    Ant igenics Inc                             60   Follow0n                 (53)        %
 19    AEt erna Laborat ories, Inc.                57   PIPE                         -
 20    Salix Pharmaceut icals Lt d                 53   Follow0n                  15         %
 21    La Jolla Pharmaceut ical Co                 52   PIPE                         -
 22    Versicor, Inc.                              45   PIPE                         -
 23    Trimeris, Inc.                              43   PIPE                         -
 24    Inhale Therapeut ic Syst ems, Inc.          40   PIPE                         -
 25    Rigel Pharmaceut icals, Inc.                32   PIPE                         -
 26    Delt agen, Inc.                             25   PIPE                         -
 27    AVI BioPharma, Inc.                         23   PIPE                         -
 28    Lynx Therapeut ics, Inc.                    23   PIPE                         -
 29    Biopure Corp                                22   Follow0n                  (5)        %
 30    Inverness Medical Innovat ions              21   PIPE                         -
 31    Biopure Corporat ion                        21   PIPE                         -
 32    Onyx Pharmaceut icals, Inc.                 20   PIPE                         -
 33    Orchid BioSciences Inc                      20   Follow0n                 950         %
 34    Genome Therapeut ics Corp                   15   Convert                      -
 35    Cygnus Inc                                  14   Follow0n                  83         %
       M edian                                    $60                             (2 )       %




      Source: Equidesk as of June 30, 2002. Aftermarket Performance based on closing price of July 15, 2002. All Deal Values/Pro ceeds                                                       46
      in millions.                                                                                                                                                                           46
Summary of 2002 U.S. Health Care New Issues
- continued

 HCS                                                                                       HCIT
                                                                 Af ter m ar k et                                                                  Af ter mar k et
     Issuer                            Pr oceeds   Of f er ing   Per f or m ance               Issuer                    Pr oceeds   Of f er ing   Per f or mance
 1   Laboratory Corp of America             $606   Follow0n                   (99)     %   1   WebMD Corp                     $300   Convert                     -
 2   AMN Healthcare Services Inc             310   Follow0n                     (3)    %   2   PracticeWorks Inc                70   Follow0n                  12 %
 3   Health Management Assoc                 275   Convert                         -       3   Computer Programs & Sys          50   IPO                       18 %
 4   Cross Country Inc                       241   Follow0n                   (36)     %       Median                          $70                             15 %
 5   LifePoint Hospitals Inc                 200   Convert                         -
 6   Medical Staffing Network                148   IPO                           6     %
 7   Coventry Healthcare Inc                 137   Follow0n                    26      %
 8   Odyssey Healthcare Inc                  131   Follow0n                   (54)     %
 9   Centene Corp                            124   Follow0n                      9     %
10   MedSource Technologies Inc              100   IPO                          (2)    %
11   Sunrise Assisted Living Inc             100   Convert                         -
12   American Medical Security Group          47   Follow0n                      6     %
     M edian                               $142                                (2 )    %




      Source: Equidesk as of June 30, 2002. Aftermarket Performance based on closing price of July 15, 2002. All Deal Values/Pro ceeds in millions.                   47
                                                                                                                                                                      47
2002 Summary of Health Care IPO Filings and
Withdrawals
                                                                    Priced                              Withdrawn                     On File

             Q1:02 Health Care                                                                              Q2:02 Health Care

                       Filing                                               Wit hdr awn     Pr icing                  Filing                                      Withdr awn   Pr icing
                       Dat e     Issuer                                        Dat e         Dat e                    Date       Issuer                              Date       Date

            Q1:02 Healt h Car e f ilings & how t hey have f ar ed                                           Q2:02 Health Car e f ilings & how they have f ar ed
              1     03/ 21/ 02   Comput er Programs and Syst ems Inc.             —        05/ 02/ 02         1     05/ 03/ 02 Endeavor Pharmaceuticals               —          —
              2     03/ 11/ 02   Ameri choi ce Corp.                              —            —              2     04/ 29/ 02   Nomos Cor p                          —          —
              3     03/ 08/ 02   Mi t okor                                        —            —              3     04/ 17/ 02   MedcoHealth Solutions Inc            —          —
              4     03/ 04/ 02   Kyphon Inc.                                      —        05/ 16/ 02         4     04/ 12/ 02   Novirio Pharmaceuticals Ltd          —          —
              5     03/ 01/ 02   Li poScience Inc.                                —            —              5     04/ 12/ 02   HealtheTech Inc                      —          —
              6     03/ 01/ 02   Eon Labs Inc.                                    —        05/ 22/ 02         6     04/ 05/ 02   CTI Inc                              —          —
              7     02/ 22/ 02   Quint on Cardi ology Syst ems                    —        05/ 06/ 02         7     04/ 02/ 02   Inver esk Resear ch Gr oup           —          —
              8     02/ 22/ 02   Al con Inc.                                      —        03/ 20/ 02       Q2:02 Health Car e Withdr awals
              9     02/ 08/ 02   Medi cal St af f ing Net work Hol dings Inc.     —        4/ 17/ 02          1     10/ 02/ 00   APBiotech Inc                    04/ 23/ 02     —
             10     01/ 30/ 02   Viacell Inc.                                     —            —              2     08/ 03/ 01   Agraquest                        04/ 26/ 02     —
             11     01/ 28/ 02   DOV Pharmaceutical Inc.                          —        4/ 24/ 02          3     12/ 07/ 01   Vertical Health Solutions        04/ 18/ 02     —
             12     01/ 16/ 02   MedSource Technologies Inc.                      —        03/ 26/ 02         4     01/ 04/ 02   Altus Medical                    06/ 14/ 02     —
             13     01/ 11/ 02   Aderis Pharmaceuticals Inc.                      —            —
             14     01/ 07/ 02   Xcel Pharmaceuticals Inc.                        —            —
             15     01/ 04/ 02   Altus Medical Inc.                           06/ 14/ 02       —
             16     01/ 02/ 02   Innovative Drug Delivery Systems Inc.            —            —
            Q1:02 Health Car e Withdr awals
              1     11/ 16/ 01 NeoGenesis Pharmaceuticals Inc.               02/ 07/ 02       —
              2     08/ 24/ 01 Alliance Medical Corp.                        03/ 12/ 02       —
              3     11/ 22/ 00 Combimatrix Corp.                             03/ 25/ 02       —




 Source: EquiDesk as of June 30, 2002.

                                                                                                                                                                                          48
                                                                                                                                                                                          48
2002 U.S. Health Care M&A Deals
       HCS                                                                                               BioTech/Pharma
      D ate Ann.    T ar get Nam e                      Acquir or Nam e                   Value          D ate Ann.    T ar get Nam e                       Acquir or Nam e                  Value
  1    04/ 29/ 02   Trigon Healt hcare Inc              Ant hem Inc                       $ 3,981    1    03/ 21/ 02   Reliant Pharm aceut icals LLC        Alkerm es Inc                     $934
  2    04/ 02/ 02   Unilab Corp                         Quest Diagnost ics Inc             1,178     2    05/ 02/ 02   Im m unex Corp-Leukine Business      Schering AG                        380
  3    06/ 14/ 02   Syncor Int ernat ional Corp         Cardinal Healt h Inc               1,096     3    06/ 10/ 02   Wyet h-Cert ain ESI Lederle Ast s    Bax t er Healt hcare Corp          305
  4    05/ 09/ 02   Dynacare Inc                        Laborat ory Corp of Am erica         653     4    06/ 10/ 02   Sobel USA Inc(Sobel BV)              PLIVA Pharm aceut ical Co          212
  5    06/ 17/ 02   Am eriChoice Corp                   Unit edHealt h Group Inc             547     5    02/ 07/ 02   Glyko Biom edical Lt d               BioMarin Pharm aceut ical Inc      143
  6    02/ 06/ 02   Nat ional Prescript ion Adm in      Ex press Script s Inc                515     6    03/ 19/ 02   Collat eral Therapeut ics Inc        Schering AG                        132
  7    02/ 07/ 02   Am erican Medical Laborat ories     Quest Diagnost ics Inc               500     7    04/ 29/ 02   Ort ho-McNeil Pharm aceut ical       King Pharm aceut icals Inc         115
  8    01/ 03/ 02   Gent iva Healt h Svcs-Specialt y    Accredo Healt h Inc                  415     8    04/ 24/ 02   MicroIslet Inc                       ALD Services Inc                    97
  9    05/ 15/ 02   Boron LePore & Associat es Inc      Cardinal Healt h Inc                 203     9    03/ 26/ 02   Om egaTech Inc                       Mart ek Biosciences                 93
 10    03/ 14/ 02   Dr Leonard's Healt hcare Corp       Cort ec Group Inc                    200    10    01/ 08/ 02   MediChem Life Sciences Inc           deCode Genet ics Inc                84
 11    03/ 28/ 02   Healt h Personnel Opt ions Corp     On Assignm ent Inc                   150    11    01/ 07/ 02   Mat rix Pharm aceut ical Inc         Chiron Corp                         59
 12    03/ 30/ 02   Spect rum Healt hcare Resources     Team Healt h Inc                     147    12    03/ 21/ 02   Enhance Pharm aceut icals Inc        Barr Laborat ories Inc              44
 13    03/ 18/ 02   Mem orial Hospit al,Mart insville   Province Healt hcare Co              121    13    02/ 05/ 02   Enzym e Bio-Syst em Lt d(CPC Int )   Genencor Int ernat ional Inc        30
 14    04/ 15/ 02   La Quint a Corp-Assist ed Living    Nat ionwide Healt h Propert ies      109    14    03/ 22/ 02   Bioglan Pharm a Inc-Cert ain         Quint iles Transnat ional Corp      27
 15    04/ 12/ 02   Alt erra-Assist ed Living(39)       Undisclosed REIT JV                   91    15    03/ 28/ 02   Circe Biom edical Inc                ICN Pharm aceut icals Inc           26
 16    05/ 29/ 02   Script LINE                         NDCHealt h Corp                       81    16    02/ 11/ 02   Brist ol-Myers Squibb Pharm a        Delt agen Inc                       24
 17    02/ 25/ 02   Manor Care Inc-Com m unit y         Healt h Managem ent Assoc             80                                                            M edian                            $95
 18    05/ 09/ 02   Pat ient Care Inc(Chem ed Corp)     Invest or Group                       70
 19    01/ 02/ 02   Claim s Services Resource Grp       Perot Syst em s Corp                  63
 20    01/ 28/ 02   Apex Therapeut ic Care Inc          Curat ive Healt h Services Inc        60
 21    02/ 08/ 02   Rayt el Medical Corp                SHL Telem edicine Lt d                50
 22    04/ 29/ 02   Qualit y Oncology Inc               Mat ria Healt hcare Inc               50
 23    05/ 22/ 02   Choice Source Therapeut ics         Carem ark Rx Inc                      49
 24    04/ 01/ 02   Specialt y Healt hcare Services     Kindred Healt hcare Inc               45
 25    01/ 10/ 02   Vit alit y Pharm aceut ical Svcs    MIM Corp                              45
 26    01/ 29/ 02   Cent rus(Healt h Solut ions Lt d)   Nat ional Medical Healt h Card        44
 27    03/ 14/ 02   Los Alam os Medical Cent er         Province Healt hcare Co               38
 28    03/ 26/ 02   Coast al Radiat ion Oncology Med    OnCure Technologies Corp              34
 29    06/ 10/ 02   Met ropolit an Healt h Net works    Moyco Technologies Inc                32
 30    03/ 31/ 02   San Diego Healt h Alliance          CRC Healt h Corp                      30
 31    06/ 03/ 02   Ex t endicare Healt h Services-Nu   Tandem Healt h Care Inc               29
 32    04/ 01/ 02   Innovat ive Resource Group Inc      APS Healt hcare Bet hsda              27
 33    01/ 16/ 02   Allied Med Inc                      Am ex drug Corp                       25
 34    06/ 11/ 02   Infinit y Infusion Care Lt d        Curat ive Healt h Services Inc        24
 35    01/ 08/ 02   Net work for Med Com m ,Research Am erican Capit al St rat egies          22
 36    06/ 04/ 02   CNA Financial Corp-Op & Adm in      First Healt h Group Corp              20
                                                        M edian                              $66
                                                                                                                                                                                                     49
                                                                                                                                                                                                     49
      Source: SDC
2002 U.S. Health Care M&A Deals - continued
       MedTech                                                                                  HCIT
      Date Ann.     T ar get Nam e                  Acquir or Nam e                 Value       Date Ann.     T ar get Name                   Acquir or Name                  Value
  1    02/ 19/ 02   Digene Corp                     Cyt yc Corp                      $558   1    06/ 17/ 02   Smart Document Solutions Inc    First Islamic Investment Bank    $104
  2    02/ 14/ 02   Oratec Int ervent ions Inc      Sm it h & Nephew PLC              311   2    05/ 29/ 02   TechRx Corp                     NDCHealth Corp                     52
  3    02/ 27/ 02   Fusion Medical Technologies     Bax t er Int ernational Inc       141   3    03/ 19/ 02   MedicaLogic/ Medscape-Digital   GE Medical Systems                 35
  4    03/ 22/ 02   SpaceLabs Medical Inc           Inst rum ent arium Corp           139   4    01/ 08/ 02   Tamtron Corp                    Impath Inc                         26
  5    06/ 04/ 02   Surgical Dynamics-Spinal        St ryker Corp                     135                                                     Median                            $44
  6    05/ 14/ 02   BEI Medical Syst ems Co         Bost on Scient ific Corp           67
  7    01/ 23/ 02   ANSYS Technologies Inc          Varian Inc                         45
  8    02/ 21/ 02   TIMM Medical Technologies Inc   Endocare Inc                       34
  9    02/ 11/ 02   Endologix Inc                   Radiance Medical Syst ems Inc      33
 10    06/ 03/ 02   Universal Im aging Corp         Molecular Devices Corp             22
                                                    M edian                          $101




                                                                                                                                                                                      50
                                                                                                                                                                                      50
      Source: SDC
Technology Activity Details
Follow-on and Electronics Deals are Leading
the 2002 Tech Market
                                                        Capital Markets

             By type of offering                                                                       By Sector

                                                                                                     Inter net
                               Equity-                                                        ITS       9%
          PIPEs                Linked                                                         8%
          30%                                                                                                          Electr onics
                                21%                                                    Softwar e                           43%
                                                IPOs                                     22%
                         Follow-                 14%
                          Ons                                                                       Communications
                          35%                                                                           18%




                                     Average Aftermarket Performance
                                         (% change)        IPOs                   Follow-Ons
                                          40%
                                          30
                                          20
                                          10
                                                            0%
                                           0
                                         (10)
                                         (20)
                                         (30)                                          (20)%

                                    # of of f er ings          13                           31



   Source: SDC and Equidesk. Aftermarket Performance based on closing price of July 15, 2002. All Deal Values/Proceeds in mil lions.   52
   Note: Best efforts, rights offerings, block trades, spot secondaries, unit and closed -end funds are excluded.                      52
Summary of 2002 and 2001 U.S. Technology
New Issues
                                                                       H1 2002

New Issues by Type                                                                  New Issues by Sector
                  # of       Af ter m ar k et        T otal       M edian                                   # of      Af ter m ar k et      T otal        Median
Issue T ype      D eals      Per f or m ance         Value         Value           Issue T ype             Deals      Per f or m ance       Value         Value
IPO                13                0%               $1,294          $72          Electronics               39             (11)%            $8,943         $150
Convert            19                 -                3,689          150          Software                  20              (53)             3,994          102
PIPE               27                 -               10,386           36          Communications            16              (50)             4,497          180
Follow-on          31              (20)%               6,387           98          ITS                        7              25               2,859          150
       T otal      90             (1 8 )%          $ 2 1 ,7 5 6     $150           Internet                   8               (4)             1,462          141
                                                                                               T otal        90            (1 8 )%        $ 2 1 ,7 5 6     $150


                                                                         H1 2001

New Issues by Type                                                                  New Issues by Sector
                  # of       Af ter m ar k et        T otal       M edian                                    # of      Af ter m ar k et      T otal       Median
Issue T ype      D eals      Per f or m ance         Value         Value            Issue T ype             Deals      Per f or m ance       Value        Value
IPO                20              43%              $10,423           $94           Electronics               66             16%            $18,788         $125
Convert            60                -                28,163          300           Software                  24               0               3,170          74
PIPE               27                -                    916          30           Communications            37               5              16,529         300
Follow-on          45                1                 9,242          141           ITS                       17              16               9,050         221
       T otal     152               9%             $ 4 8 ,7 4 5     $146            Internet                   8             (19)              1,209          64
                                                                                                T otal       152              9%           $ 4 8 ,7 4 5    $146




       Source: SG Cowen, SDC and EquiDesk as of June 30, 2002. Aftermarket Performance based on closing price of July 15, 2002.                               53
       Note: Best efforts, rights offerings, block trades, spot secondaries, unit and closed -end funds are excluded.                                         53
     Summary of 2002 U.S. Technology New Issues
 Electronics                                                                                 Communications                                                                          Software
                                                                Af ter m ar k et                                                                       Af ter m ar k et                                                                          Af ter m ar k et
     Issuer                           Pr oceeds   Of f er ing   Per f or m ance              Issuer                         Pr oceeds    Of f er ing   Per f or m ance               Issuer                            Pr oceeds   Of f er ing   Per f or m ance
 1   Taiwan Sem iconduct or Mfg           $871    Follow-On                (20)     %    1   Echost ar Com m unications         $1,500   PIPE                           -        1   divine, inc.                         $610     PIPE                         -
 2   SONICblue, Inc.                       623    PIPE                          -        2   Act erna Corporation                  750   PIPE                           -        2   Com put er Associat es Int 'l         500     Convert                      -
 3   Fairchild Sem iconduct or Int 'l      513    Follow-On                (14)     %    3   Hypercom Corporation                  394   PIPE                           -        3   Aspen Technology, Inc.                500     PIPE                         -
 4   Advanced Micro Devices Inc            500    Convert                       -        4   Spect raSit e Holdings, Inc.          350   PIPE                           -        4   Ex pedia, Inc.                        470     PIPE                         -
 5   Thom son Mult im edia                 452    Convert                       -        5   Nex t Level Com m unications, Inc.    300   PIPE                           -        5   Aspen Technology, Inc.                400     PIPE                         -
 6   Unit ed Microelect ronics Corp        440    Follow-On                (17)     %    6   Wire One Technologies, Inc .          220   PIPE                           -        6   Em ulex Corp                          300     Convert                      -
 7   Manufact urers' Services Lim it ed    415    PIPE                          -        7   Polycom Inc                           218   Follow-On                 (66)     %    7   Acclaim Ent ert ainm ent , Inc.       215     PIPE                         -
 8   FSI Int ernat ional, Inc.             395    PIPE                          -        8   UTSt arcom Inc                        203   Follow-On                   (3)    %    8   Aspen Technology, Inc.                200     PIPE                         -
 9   Mat t son Technology, Inc.            375    PIPE                          -        9   Sirius Satellit e Radio Inc           158   Follow-On                 (64)     %    9   Com put er Net work Tech              125     Convert                      -
10   Redback Net works, Inc.               358    PIPE                          -       10   P-Com , Inc.                           80   PIPE                           -       10   SeaChange Int ernat ional Inc         104     Follow-On                (75)    %
11   Elect roglas, Inc.                    355    PIPE                          -       11   Verint Syst ems Inc                    72   IPO                       (40)     %   11   Docum ent um Inc                      100     Convert                      -
12   SIPEX Corporat ion                    255    PIPE                          -       12   Arris Group Inc                        71   Follow-On                    2     %   12   Seebeyond Technology Corp              82     Follow-On                (77)    %
13   Adapt ec Inc                          250    Convert                       -       13   Synapt ics Inc                         55   IPO                       (25)     %   13   Cam inus Corp                          79     Follow-On                (85)    %
14   CTS Corporat ion                      250    PIPE                          -       14   Allen Telecom Inc                      50   Convert                        -       14   SAFLINK Corporat ion                   66     PIPE                         -
15   Merix Corporat ion                    250    PIPE                          -       15   C-Cor.net                              48   Follow-On                 (60)     %   15   IONA Technologies Plc                  60     Follow-On                (79)    %
16   Tripat h Technology, Inc.             210    PIPE                          -                                                                                               16   Alt iris Inc                           50     IPO                      (46)    %
                                                                                        16   ViaSat Inc                             29   Follow-On                 (62)     %
17   Cym er Inc                            200    Convert                       -            M edian                                                                            17   Plum t ree Soft ware                   43     IPO                      (53)    %
                                                                                                                                 $180                             (5 0 )    %
18   Rit ek Corp                           175    Convert                       -                                                                                               18   Print cafe Soft ware Inc               38     IPO                      (53)    %
19   Int egrat ed Defense Tech             154    IPO                         0     %                                                                                           19   CoorsTek Inc                           33     Follow-On                (19)    %
20   ST Assem bly Test Services            150    Convert                       -                                                                                               20   Onyx Soft ware Corp                    20     Follow-On                (16)    %
21   Macronix Int ernat ional Co           150    Convert                       -                                                                                                    M edian                              $102                             (5 3 )   %
22   Unit ed Microelect ronics Corp        128    Convert                       -
23   Technit rol Inc                       124    Follow-On                  (7)    %
24   ChipPAC Inc                           105    Follow-On                (37)     %
25   Triumph Group Inc                      95    Follow-On                   6
26   Benchm ark Elect ronics Inc           101    Follow-On                 11      %
27   Phot on Dynam ics Inc                 100    Follow-On                (33)     %
28   GenCorp Inc                           100    Convert
29   Avaya Inc                             100    Follow-On                (35)     %
30
31
     CMC Magnet ics Corp
     Ax celis Technologies Inc
                                           100
                                           100
                                                  Convert
                                                  Convert
                                                                                -
                                                                                -
                                                                                             ITS                                                                                     Internet
32   ESS Technology Inc                     93    Follow-On                  (9)    %
33   Am bit Microsyst em s Corp             85    Convert                       -                                                                      Af ter m ar k et                                                                          Af ter m ar k et
34   DDI Corp                               75    Convert                       -            Issuer                         Pr oceeds    Of f er ing   Per f or m ance               Issuer                            Pr oceeds   Of f er ing   Per f or m ance
35   Herley Indust ries Inc                 69    Follow-On                (13)     %
                                                                                        1    Accent ure Lt d                  $1,870     Follow-On                (30)      %   1    Sabre Holdings Corp                  $365     Follow-On                (34)    %
36   Helix Technology Corp                  61    Follow-On                  (7)    %
                                                                                        2    Ant eon Int ernat ional Corp        270     IPO                       23       %   2    KANA Soft ware, Inc.                  345     PIPE                         -
37   ChipPAC Inc                            60    Follow-On                  (8)    %
                                                                                        3    Veridian Corp                       216     IPO                       27       %   3    Alloy, Inc.                           300     PIPE                         -
38   TTM Technologies Inc                   54    Follow-On                (42)     %
                                                                                        4    Acx iom Corp                        150     Convert                      -         4    Ticket s.com, Inc.                    200     PIPE                         -
39   Sypris Solut ions Inc                  52    Follow-On                   6     %
     M edian                                                                        %
                                                                                        5    CACI Int ernat ional Inc            149     Follow-On                  5       %   5    Net flix Inc                           83     IPO                       13     %
                                          $150                            (1 1 )
                                                                                        6    ManTech Int ernat ional Corp        115     IPO                       31       %   6    PayPal Inc                             70     IPO                       78     %
                                                                                        7    SRA Int ernat ional Inc              90     IPO                       38       %   7    Alloy Inc                              61     Follow-On                (18)    %
                                                                                             M edian                           $150                               25        %   8    Overst ock.com Inc                     39     IPO                        (4)   %
                                                                                                                                                                                     M edian                              $141                               (4 )   %




                 Source: Equidesk as of June 30, 2002. Aftermarket Performance based on closing price of July 15, 2002. All Deal Values/Pro ceeds in millions.                                                                                                54
                                                                                                                                                                                                                                                              54
2002 Summary of Technology IPO Filings and
Withdrawals
                                                            Priced        Withdrawn                              On File

 Q1:02 Technology                                                            Q2:02 Technology
 Filing                                        Withdr awn     Pr icing      Filing                                              Withdr awn   Pr icing
 Date          Issuer                             Date         Date         Date          Issuer                                   Date       Date

 Q1 T echnology Filings and How T hey Far ed                                Q2 T echnology Filings and How T hey Far ed
 01/ 11/ 02    Inter Video Inc                     —             —          04/ 22/ 02    For mFactor Inc                           —          —
 01/ 25/ 02    Mantech International Corp.         —         01/ 28/ 02     04/ 23/ 02    Bentley Systems Inc                       —          —
 02/ 01/ 02    PayPal                              —         02/ 04/ 02     05/ 02/ 02    PwCC Ltd                                  —          —
 02/ 07/ 02    Verint Systems Inc                  —         05/ 15/ 02     05/ 02/ 02    NP T est Inc.                             —          —
 02/ 13/ 02    Pr intcaf e Sof twar e Inc          —             —          05/ 30/ 02    Advanced Semiconductor Engineer ing       —          —

 02/ 25/ 02    Altiris Inc                         —         05/ 22/ 02     06/ 04/ 02    IMPAC Medical Systems Inc                 —          —

 03/ 02/ 02    Anteon International                —         03/ 11/ 02     Q2:02 T echnology Withdr awals
 03/ 05/ 02    SRA International Inc               —         05/ 23/ 02     03/ 22/ 00    Webhelp.com                           04/ 10/ 02
 03/ 06/ 02    Netf lix Inc                        —         05/ 22/ 02     08/ 04/ 00    Unispher e Networ ks                  05/ 20/ 02
 03/ 06/ 02    Veridian Corp                       —         06/ 04/ 02
 03/ 29/ 02    AECOM T echnology Cor p             —             —
 Q1:02 T echnology Withdr awals
 09/ 22/ 00    AMR Research                    01/ 09/ 02
 06/ 14/ 01    Silicon Energy Corp             04/ 12/ 02




    Source: EquiDesk as of June 30, 2002.

                                                                                                                                                        55
                                                                                                                                                        55
2002 U.S. Technology M&A Deals
        Software                                                                                            Communications
        D at e Ann.    T ar get Nam e                     Acquir or Nam e                     Value         D ate Ann.     T ar get Nam e                     Acquir or Nam e                   Value
    1     04/ 29/ 02   HNC Soft ware Inc                  Fair Isaac & Co Inc                   $826    1     02/ 18/ 02   ONI Syst ems Corp                  CIENA Corp                          $968
    2     06/ 24/ 02   GE Global eXchange Services        Francisco Part ners                    800    2     05/ 20/ 02   Unisphere Net works Inc            Juniper Net works                    735
    3     04/ 30/ 02   Micro General Corp(Fidelit y)      Fidelit y Nat ional Inform at ion      478    3     02/ 19/ 02   Celiant (New Vent ure,Pequot )     Andrew Corp                          470
    4     02/ 20/ 02   OTG Soft ware Inc                  Legat o Syst em s Inc                  393    4     03/ 19/ 02   Oplink Communicat ions Inc         Avanex Corp                          287
    5     01/ 07/ 02   H O Syst em s Inc                  VeriSign Inc                           340    5     01/ 17/ 02   Prox im Inc                        West ern Mult iplex Corp             222
    6     04/ 24/ 02   Sim plex Solut ions Inc            Cadence Design Syst em s Inc           275    6     05/ 01/ 02   Hammerhead Net works Inc           Cisco Syst ems Inc                   173
    7     06/ 10/ 02   SkillSoft Corp                     Sm art Force PLC                       231    7     05/ 20/ 02   Spect rian Corp                    Remec Inc                            161
    8     06/ 10/ 02   SilverSt ream Soft ware Inc        Novell Inc                             212    8     01/ 07/ 02   Arguss Communicat ions Inc         Dycom Indust ries Inc                149
    9     04/ 23/ 02   Innoveda Inc                       Ment or Graphics Corp                  175    9     01/ 22/ 02   Ast ral Point Communicat ions      Alcat el SA                          141
   10     04/ 02/ 02   ONTRACK Dat a Int ernat ional      Kroll Inc                              141   10     03/ 28/ 02   Lucent Technologies-Plant ,MA      Solect ron Corp                      125
   11     05/ 29/ 02   Telera Inc                         Alcat el SA                            136   11     03/ 18/ 02   Lockheed Mart in Corp-World        Int l Telecom Sat ellit e Org        120
   12     02/ 21/ 02   Revit Technology Corp              Aut odesk Inc                          133   12     05/ 23/ 02   Dat um Inc                         Symmet riCom Inc                     112
   13     03/ 18/ 02   Mechanical Dynam ics Inc           MSC.Soft ware Corp                     128   13     01/ 02/ 02   PerkinElmer Inc-Det ect ion        L-3 Communicat ions Holdings         100
   14     02/ 25/ 02   Corporat e Soft ware Inc           Level 3 Com m unicat ions Inc          120   14     01/ 29/ 02   Dorsal Net works                   Corvis Corp                           90
   15     01/ 05/ 02   Talarian Corp                      TIBCO Soft ware Inc                    110   15     03/ 01/ 02   Condat AG                          Tex as Inst rument s Inc              83
   16     06/ 04/ 02   Managem ent Report s Inc           Int uit Inc                             92   16     03/ 27/ 02   AccessLan Communicat ions Inc      Advanced Fibre Communicat ions        75
   17     03/ 12/ 02   Valit y Technology Inc             Ascent ial Soft ware Corp               92   17     06/ 24/ 02   Agere Syst ems Inc-Analog Line     Legerit y Inc                         70
   18     01/ 24/ 02   Mom ent um Business Apps           PeopleSoft Inc                          90   18     01/ 08/ 02   Ex ecut ive Conference Inc         Invest corp Bank EC(CP Holding)       60
   19     04/ 17/ 02   Quest ron Technology Inc           GE Supply(General Elect ric Co)         89   19     05/ 23/ 02   New Focus Inc-Laser Tech Bus       Int el Corp                           50
   20     06/ 27/ 02   Eclipse Inc                        Int uit Inc                             85   20     02/ 07/ 02   Rapidst ream Inc                   Wat chguard Technologies Inc          48
   21     03/ 11/ 02   3Dlabs Inc Lt d                    Creative Technology Lt d                74   21     04/ 25/ 02   Scion Phot onics Inc               JDS Uniphase Corp                     43
   22     05/ 29/ 02   SignalSoft Corp                    Openwave Syst em s Inc                  57   22     01/ 23/ 02   Tsunami Opt ics Inc                St rat os Light wave Inc              42
   23     03/ 12/ 02   Javelin Technologies               NYFIX Inc                               55   23     01/ 07/ 02   GlobalNet Inc                      Tit an Corp                           35
   24     01/ 03/ 02   Virt ual Financial Services Inc    Digit al Insight Corp                   51   24     04/ 24/ 02   Kept el Inc                        Undisclosed Acquiror                  30
   25     02/ 15/ 02   LineSoft Corp                      It ron Inc                              42   25     01/ 10/ 02   Cypress Communicat ions Inc        US RealTel Inc                        28
   26     02/ 08/ 02   Sequiam Inc                        Wedge Net Ex pert s Inc                 36   26     04/ 16/ 02   Dit ech Commun-Telinnovat ion      Tex as Inst rument s Inc              27
   27     02/ 04/ 02   Asht on Technology Group Inc       Opt iMark Innovat ions Inc              30   27     06/ 19/ 02   Anrit su US-Remot e Svc Test Bus   Spirent PLC                           26
   28     02/ 19/ 02   Int elligent Sys Soft ware Inc     Howt ek Inc                             29   28     03/ 19/ 02   Paracer Inc                        St rat os Light wave Inc              23
   29     04/ 16/ 02   Dit ech Com m un-Telinnovat ion    Tex as Inst rum ent s Inc               27   29     01/ 22/ 02   E Mergent Inc                      ClearOne Communicat ions Inc          22
   30     05/ 09/ 02   Flagship Group                     Int uit Inc                             26   30     04/ 08/ 02   Kaul-Tronics Inc                   California Amplifier Inc              22
   31     02/ 12/ 02   Ishoni Net works                   Koninklijke Philips Elect ronic         25                                                          M edian                             $79
   32     06/ 10/ 02   Techfi Corp                        Advent Soft ware Inc                    23
   33     03/ 19/ 02   Com m unicat ions Solut ions Inc   Rockwell Collins Inc                    23
   34     04/ 10/ 02   Defect & Yield Mgm t (Nort h)      HPL Technologies Inc                    22
   35     03/ 26/ 02   MoreDirect .com Inc                PC Connect ion Inc                      21
   36     05/ 20/ 02   Odigo Inc                          Com verse(Com verse Technology)         20
   37     02/ 19/ 02   Sim plex it y Inc                  Inphonic Inc                            20
                                                          M edian                               $89




                                                                                                                                                                                                         56
                                                                                                                                                                                                         56
 Source: SDC
2002 U.S. Technology M&A Deals
      Electronics                                                                                                 Internet
          D ate Ann.      T ar get Nam e                       Acquir or Nam e                     Value
                                                                                                                  Date Ann.      T ar get Nam e                    Acquir or Nam e                  Value
     1      04/ 17/ 02    IBM Corp-Hard Disk Drive             Hit achi Lt d                       $2,050
                                                                                                              1    05/ 31/ 02    Ex pedia Inc                      USA Interactive                   $2,081
     2      03/ 08/ 02    Elant ec Semiconduct or Inc          Int ersil Corp                       1,432
                                                                                                              2    04/ 08/ 02    Datek Online Holdings Corp        Ameritrade Holding Corp            1,361
     3      01/ 10/ 02    Marconi Dat a Sys(Marconi PLC)       Danaher Corp                           400
     4                    Dominion Semiconduct or LLC          Micron Technology Inc                          3    05/ 31/ 02    Ticketmaster                      USA Interactive                    1,122
            01/ 16/ 02                                                                                303
     5      04/ 09/ 02    Mobilink Telecom Inc                 Broadcom Corp                          258     4    05/ 31/ 02    Hotels.com(USA Interactive)       USA Interactive                    1,015
     6      01/ 08/ 02    IBM-Net Vist a Ops                   Sanmina-SCI Corp                       177     5    02/ 19/ 02    Travelocity.com Inc(Sabre Hlg)    Sabre Holding Corp                   447
     7      03/ 11/ 02    3Dlabs Inc Lt d                      Creat ive Technology Lt d              103     6    04/ 10/ 02    Tradescape.com                    E*Trade Group Inc                    280
     8      05/ 01/ 02    Navarro Net works Inc                Cisco Syst ems Inc                      85     7    06/ 10/ 02    SkillSoft Corp                    SmartForce PLC                       231
     9      03/ 20/ 02    Undisclosed Defense Elect n          EDO Corp                                70     8    03/ 11/ 02    Be Free Inc                       Valueclick Inc                       132
    10      02/ 25/ 02    API Heat Transfer Inc(Danaher)       Madison Capit al Part ners              66     9    06/ 25/ 02    Wink Communications Inc           Liberty Broadband Interactive        100
    11      01/ 23/ 02    Micro Robot ics Syst ems Inc         Newport Corp                            65    10    05/ 30/ 02    Official Payments Corp            Tier Technologies Inc                 76
    12      03/ 19/ 02    Dome Imaging Syst ems Inc            Planar Syst ems Inc                     61    11    06/ 10/ 02    PeoplePC Inc                      EarthLink Inc                         44
    13      04/ 15/ 02    IFR Syst ems                         Aeroflex Inc                            60    12    02/ 22/ 02    Billpoint Inc(eBay Inc)           eBay Inc                              44
    14      04/ 22/ 02    Clare Inc                            IXYS Corp                               56    13    03/ 25/ 02    Site59.com Inc                    Travelocity.com Inc(Sabre Hlg)        43
    15      05/ 22/ 02    PowerSmart Inc                       Microchip Technology Inc                54    14                  NetSchools Corp                   Plato Learning Inc
                                                                                                                   05/ 09/ 02                                                                            23
    16      04/ 29/ 02    Gain Technology Corp                 St andard Microsyst ems Corp            52    15                  Electronic Payment Ex change      InterCept Inc
                                                                                                                   03/ 20/ 02                                                                            21
    17      02/ 06/ 02    Alchemy Semiconduct or Inc           Advanced Micro Devices Inc              50
    18      01/ 29/ 02    Test Chip Technologies Inc           HPL Technologies Inc                    42                                                          M edian                            $132
    19      03/ 26/ 02    PaR Syst ems Inc                     American Capit al St rat egies          36
    20      03/ 26/ 02    HiEnergy Microdevices Inc            SLW Ent erprises Inc                    31
    21      01/ 11/ 02    LAU Securit y Syst ems(LAU)          Viisage Technology Inc                  28
    22      01/ 29/ 02    Elekt ryon Inc-Cert ain Asset s      Ocean Power Corp                        25
    23
    24
            03/ 19/ 02
            04/ 08/ 02
                          Paracer Inc
                          Kaul-Tronics Inc
                                                               St rat os Light wave Inc
                                                               California Amplifier Inc
                                                                                                       23
                                                                                                       22
                                                                                                                  IT Services
    25      03/ 28/ 02    Truet ime Inc                        Symmet riCom Inc                        22
    26      05/ 07/ 02    In-Chip Syst ems Inc                 Virage Logic Corp                       20
                                                               M edian                               $58          D ate Ann.     T ar get Nam e                    Acquir or Nam e                  Value
                                                                                                              1     01/ 07/ 02   H O Syst ems Inc                  VeriSign Inc                       $340
                                                                                                              2     04/ 02/ 02   ONTRACK Dat a Int ernat ional     Kroll Inc                           141
                                                                                                              3     05/ 02/ 02   Soft ware Spect rum Inc           Level 3 Communicat ions Inc         130
         Aerospace                                                                                            4
                                                                                                              5
                                                                                                                    03/ 20/ 02
                                                                                                                    04/ 05/ 02
                                                                                                                                 IBILL
                                                                                                                                 Viant Corp
                                                                                                                                                                   Int erCept Inc
                                                                                                                                                                   Divine Inc
                                                                                                                                                                                                       112
                                                                                                                                                                                                        96
                                                                                                              6     05/ 08/ 02   CBS Employer Services Inc         Int uit Inc                          78
                                                                                                              7     02/ 26/ 02   Science & Engineering Assoc       Tit an Corp                          72
           D ate Ann.      T ar get Nam e                       Acquir or Nam e                     Value     8     02/ 13/ 02   SignalTree Solut ions Holdings    Keane Inc                            62
                                                                                                              9     04/ 09/ 02   Decision Consult ant s Inc        CIBER Inc                            60
      1      02/ 22/ 02    TRW Inc                              Nort hrop Grumman Corp              $6,810
                                                                                                             10     02/ 13/ 02   Delt ek Syst ems Inc              Invest or Group                      57
      2      01/ 14/ 02    Rayt heon Co-Aircraft Int grt ion    L-3 Communicat ions Hdgs             1,130
      3                    Visionics Corp                       Ident ix Inc                                 11     01/ 03/ 02   Virt ual Financial Services Inc   Digit al Insight Corp                51
             02/ 22/ 02                                                                                301
      4                    Advanced Technical Product s         General Dynamics Corp                        12     02/ 07/ 02   Rapidst ream Inc                  Wat chguard Technologies Inc         48
             05/ 02/ 02                                                                                251
      5      05/ 28/ 02    Condor Syst ems Inc                  EDO Corp                               112   13     04/ 17/ 02   GovConnect Inc                    govOne Solut ions LP                 45
      6      01/ 02/ 02    PerkinElmer Inc-Det ect ion          L-3 Communicat ions Hdgs               100   14     03/ 04/ 02   Radian Inc                        Engineered Support Syst ems          42
      7      05/ 28/ 02    Eat on Corp-Navy Cont rols           DRS Technologies Inc                    92   15     02/ 27/ 02   O2Wireless Solut ions Inc         Baran Group Lt d                     40
      8      01/ 07/ 02    SY Technology                        L-3 Communicat ions Hdgs                48   16     02/ 21/ 02   BSI2000 Inc                       Knowledge Foundat ions Inc           36
      9      04/ 19/ 02    Burke Indus-Engineer Polymers        Est erline Technologies Corp            38   17     01/ 08/ 02   Enron-Office Funct ions & Info    BP PLC                               25
     10      03/ 13/ 02    Able Corp                            Smit hs Aerospace(Smit hs Group)        28   18     02/ 28/ 02   Technology Info Financial Svcs    Informat ion Leasing Corp            22
     11      01/ 31/ 02    Aerogroup Int ernat ional Corp       Diversified Resources Group             26   19     02/ 06/ 02   AmQUEST Inc(American Soft ware)   Infocrossing Inc                     20
     12      03/ 26/ 02    HiEnergy Microdevices Inc            SLW Ent erprises Inc                    24                                                         M edian                            $57
     13      03/ 19/ 02    Communicat ions Solut ions Inc       Rockwell Collins Inc                    23
     14      02/ 06/ 02    TECSTAR Inc-Applied Solar Div        Emcore Corp                             21
                                                                M edian                               $70


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