Equity Capital Markets Overview

1. Equity Capital Markets Overview April 1, 2002

2. Equity Capital Markets Overview Market commentary - major indices and new issue volume down in 2002 Performance of Major Indices in 2002 Declining Stock Prices and Market Volitilty have Led to… • Declining production and corporate capital spending have resulted in an “economic recession” although Greenspan believes an “economic expansion” is underway • S&P 500 corporate earnings in 2002 expected to increase 17.4% • S&P 500 P/E multiple at 23.5x for 2002E(1) vs. historical “bull-market” peaks of 17x • S&P 500 and Nasdaq lost (13.0%) and (21.1%), respectively, in 2001 • BAS’ market strategist, Tom McManus, disputes consensus view that a robust recovery has begun Recent New Equity Issuance ($ Billions) ...New Issue Volume Being Down in 2002 • Only 480 transactions raising $139.3 billion in 2001 - 85 IPOs and 395 follow-ons - down 45% (#) and 48% ($) vs. 2000 • New issue volume up 7.8% (by $ volume) 2002 vs. 2001 • 129 transactions raising $28.6 billion thus far in 2002 - 17 IPOs and 112 follow-ons • Backlog of $18.9 billion in 94 transactions, including 60 IPOs (1) Banc of America Securities’ estimates. Source: Dealogic as of 3/31/02. Excludes all offerings less than $20mm and includes ADRs.

3. Equity Capital Markets Overview The market for IPOs in 2002 has been light INITIAL PUBLIC OFFERINGS 2002 YTD NUMBER OF DEALS BY MARKET CAP(1) NUMBER OF DEALS BY SECTOR • Majority of transactions from the Healthcare, Consumer and Technology sectors • Most issues pricing within the filing range • Moderate aftermarket performance as IPOs are up a median of 12% offer to current, including 9% on first trading day • Issuers from virtually all sectors completing transactions (1) Market caps defined as micro-cap <$250M; small-cap $250M and $1.5B; mid-cap $1.5B and $5B; large-cap $5B. Source: Dealogic; 3/31/02. Excludes offerings less than $20mm.

4. Equity Capital Markets Overview A large percentage of the follow-on volume in 2002 has come from accelerated transactions NUMBER OF DEALS BY TYPE OF OFFERING(1) FOLLOW-ON OFFERINGS 2002 YTD (DEALS FROM LAST THREE WEEKS SHOWN IN DETAIL) NUMBER OF DEALS BY SECTOR(1) • Issuers from all sectors completing transactions • Increased “bought” deal and accelerated marketing activity • Average marketed offering pricing at a 6.9% discount from filing price • Moderate aftermarket performance as median SEC is up 8.6% (1) Includes all follow-on offerings since 1/1/02. Source: Dealogic; 3/31/02. Excludes offerings less than $20mm.

5. The new issue backlog is light and primarily from healthcare, technology, financial and industrial companies Equity Capital Markets Overview Dollar Volume ($Billions) Number of Deals IPO Backlog by Sector (by $ Volume) Follow-On Backlog by Sector (by $ Volume) Source: Dealogic 3/31/02, excludes offerings less than $20mm and includes ADRs.

6. Equity Capital Markets Overview Equity mutual fund flows were down dramatically in 2001 but are recovering in 2002 Domestic Equity Fund Flows have seen meaningful gaines in 2002 Technology Funds suffered Net Outflows for 12 of the past 15 Months Source: AMG Data Services; as of 3/22/02.

7. Equity Capital Markets Overview Market commentary - the technology equity market remains in a secular bear market Performance of Technology Indices in 2002 Substantial Declines in Technology Earnings Drove Indices Down... • Disappointing earnings and lower guidance for technology companies with estimated earnings growth of -62% in 2001 • Negative earnings driven by capital expenditure deceleration, excess inventories and slowing end-market demand • Projected earnings growth of -23%, 42%, and 140%, in Q1 - Q3 2002; full year 2002E earnings growth of 45%(1) • The S&P 1500 Technology sector is trading at 42.7x 2002E earnings or 2.5x its earnings growth rate (EGR) of 17.2% vs non-techs at 1.8x an EGR of 12.7% (2) Technology New Equity Issuance in 2002 ($ Billions) …as well as Technology New Equity Issuance • Only 73 transactions raising $21.1 billion completed in 2001 as new issue volume down 82% (#) and 80% ($) vs 2000 • Billion dollar technology carve outs Agere, KPMG and Accenture accounted for 40% of the total capital raised in the technology sector • Technology was best performing sector for 2001 IPOs: • Average return of 38%, including 23% first day return • The 4 best performing U.S. IPOs in 2001 all from the technology sector: Verisity Ltd, Magma, Monolithic System Tech and Nassda • 20 transactions raising $4.0 billion completed thus far in 2002 • Limited backlog - 15 transactions expected to raise ~$5.1 billion • Accenture accounts for $2.9 billion (1) First Call estimates. (2) BAS research estimates. Source: DealLogic as of 3/31/02. Includes ADRs, excludes offerings less than $20mm.

8. Equity Capital Markets Overview There have been few technology IPOs since 1/1/01... TECHNOLOGY IPOs SINCE 1/1/01 $ VOLUME BY SUB-SECTOR NUMBER OF DEALS BY MARKET CAP(1) (1) Market caps defined as micro-cap <$250M; small-cap $250M and $1.5B; mid-cap $1.5B and $5B; large-cap $5B. Source: Dealogic; 3/31/02. Excludes offerings less than $20mm. 7

9. Equity Capital Markets Overview …while the technology follow-on market is active and balanced across subsectors $ VOLUME BY SUB-SECTOR TECHNOLOGY FOLLOW-ONS 2002 YTD NUMBER OF DEALS BY MARKET CAP(1) 8 (1) Market caps defined as micro-cap <$250M; small-cap $250M and $1.5B; mid-cap $1.5B and $5B; large-cap $5B. Source: Dealogic; 3/31/02. Excludes offerings less than $20mm.

10. Equity Capital Markets Overview The technology backlog is limited with only 15 Transactions currently on file with the SEC Total Backlog by Sector based on # of Deals Total Backlog by Sector based on $ Volume 9 Source: Dealogic 3/31/02, excludes all offerings less than $20mm.