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EGL Ventures IV

EGL Ventures IV. Private and Confidential. EGL Ventures IV. Target: $100 million in capital. Balanced: Early- and later-stage. Geography: Southeast U.S. focus. Sectors: Balanced between information technology, telecomm, and health care. Management: 50+ years experience. Introduction.

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EGL Ventures IV

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  1. EGL Ventures IV Private and Confidential

  2. EGL Ventures IV • Target: $100 million in capital. • Balanced:Early- and later-stage. • Geography: Southeast U.S. focus. • Sectors: Balanced between information technology, telecomm, and health care. • Management: 50+ years experience. Introduction Introduction Opportunity People Performance Portfolio EGL Ventures Confidential Process Summary

  3. EGL-IV History • Aggregate 50+ years of successful private equity investing. • Two General Partners have worked together for 15 years in three predecessor funds. • New GP has eight years experience in three funds totaling $260 million. • Fourth fund in the Southeast for all General Partners. • The right team with the right strategy at the right time. Introduction Introduction Opportunity People Performance Portfolio EGL Ventures Confidential Process Summary

  4. Private Equity Sector Introduction Introduction NASDAQ 12.4% Opportunity S&P 500 12.9% People Venture Economics:20-year net returns through 12/31/03 Performance All Private Equity 13.6% Portfolio Buyout Funds 12.4% Process Later-stage VC 13.8% Summary $107M invested;$170M returned;$14M unrealized. Balanced VC 13.3% Early-stage VC 19.1% 15-year net returnsthrough 12/31/03 EGL GP NetReturns 23.5% All returns shown net of management fees and carried interest. EGL Ventures Confidential

  5. Regional Opportunity • Regional advantages: • $1.5 trillion economy • Low taxes, low cost of living • Deep pool of human capital • Intellectual capital anchored by universities and Federal R&D • Other pieces are in place (legal, banking, accounting, etc.) Introduction Introduction Opportunity People Performance Portfolio EGL Ventures Confidential Process Summary

  6. Technology in the Southeast Multiple technology centers. Anchored by: Atlanta, Research Triangle, Florida. Pockets of innovation: Universities, Federal R&D centers. Introduction Introduction Opportunity People Performance Portfolio EGL Ventures Confidential Process Summary Biggest challenge:Lack of local venture capital.

  7. Regional Undercapitalization • Venture firms do not offer adequate leverage for local R&D. Introduction Introduction Opportunity People Performance 21 Portfolio EGL Ventures Confidential 45 Process 9 40 Summary 35 Substantial room for improvement! 30 25 20 15 1.6  10 University R&D ($B) 5 Venture Investment ($B) 0 Source: Venture Economics and the Center for R&D Bay Area Northeast Southeast

  8. The EGL Advantage • Substantial operational experience at CXO levels. • 15 years of investing in the Southeast. • Staying the course: Technology-oriented growth companies. • A record of leadership. Introduction Introduction Opportunity People Performance Portfolio EGL Ventures Confidential Process Summary EGL was first outside investor in 20 out of 31 deals. 5 11 EGL held board seats in 26 out of 31 deals. 20 26

  9. Management Team • Three General Partners: • David Ellis • Stephen Fleming • Salvatore Massaro • Two Senior Associates already identified. • Advisory Board. Introduction Introduction Opportunity People Performance Portfolio EGL Ventures Confidential Process Summary

  10. David Ellis • 27+ years investment experience. • Oversight of 100+ investments at 3i. • 13 investments at EGL. • Commercialization of superconducting magnet technology, leading to creation of MRI industry. • Ph.D., Biophysics;BS, Chemistry (both St. Andrews). • Georgia Tech Advisory Board memberships. • Substantial CXO operations experience. • 15-year partnership with Sal Massaro. Introduction Introduction Opportunity People Performance Portfolio EGL Ventures Confidential Process Summary

  11. Stephen Fleming • 8+ years investment experience. • General Partner, Alliance Technology Ventures. • 18 investments as lead investor, 15 exits to date. • BS, Physics, Ga. Tech (Highest Honors). • 15 years operational experience at AT&T Bell Labs, Nortel, LICOM(venture-backed startup). • Supervised startups developing first ADSL modem and one of the first cablemodems in early 1990s. • Multiple advisory boards at Georgia Tech; endowed chair in telecomm; instructor in MBA entrepreneurship program. • Strong regional technology leader. Introduction Introduction Opportunity People Performance Portfolio EGL Ventures Confidential Process Summary

  12. Salvatore Massaro • 20+ years investment experience. • 13 investments, 13 exits. • Prudential-Bache Venture Capital, Price Waterhouse. • CFO through IPO of Telesphere Int’l. • MBA, Harvard University;BSBA, Georgetown (High Honors). • Former Member of NASBIC Board of Governors. • 15-year partnership with David Ellis. Introduction Introduction Opportunity People Performance Portfolio EGL Ventures Confidential Process Summary

  13. Advisors Introduction Introduction Opportunity People Performance Portfolio EGL Ventures Confidential Process Summary

  14. EGL Performance Introduction Opportunity People Performance Portfolio Process Summary Net IRR (annualized): 23.5% Net Multiple: 1.5  All returns shown net of management fees and carried interest. 31 investments over 15 years (1989–2003) $107M invested;$170M returned;$14M unrealized. EGL Ventures Confidential

  15. EGL Performance $107M invested, $170M realized. $14M still unrealized at current valuations. Introduction Opportunity People Performance Portfolio EGL Ventures Confidential Process Summary

  16. Previous Portfolio Companies Introduction Introduction ADS NetTools (EGL) Artcraft (EGL) Astracom (SRF) At Work (EGL) Boca Photonics (SRF) BroadRiver (SRF) Care Centric (SRF) Checkmate (EGL) Digital Furnace (SRF) Eprise (SRF) Fluid Data (EGL) Home Wireless (SRF) iFleet (EGL) iPower (SRF) The Learning Co. (EGL) Pathfire (SRF) Physician Health Corp. (EGL) Pi Holdings (EGL) Quokka Sports (EGL) Renaissance Int. (EGL) RF Micro Devices (SRF) RF Solutions (SRF) SecureWorks (SRF) Simione Central (EGL) Sportsline (SRF) Synchrologic (SRF) Telaxis (SRF) ValuBond (SRF) Verifiber (SRF) ZapMedia (SRF) Zarina (EGL) Opportunity People Performance Portfolio EGL Ventures Confidential Process Summary • Successful IPOs and M&As.

  17. Previous Syndicate Partners Quadrangle Capital Riggs Capital Robinson Humphrey Sand Hill Capital Sevin Rosen Funds US Venture Partners Vantage Point Weston Presidio Invited Us to Lead Subsequent Round Advanced Tech Ventures Allen Telecom CBS Coral Ventures Domain Associates EMC Ventures Kleiner Perkins Lucent Ventures Prism Ventures Reuters US West Followed Our Origination AT&T Ventures Bank of America Charles Schwab Cordova Ventures Crystal Ventures FT Ventures GE Capital Grotech Capital Halpern Denny Imlay Investments Intelligent Systems ITC Holdings IVP / Redpoint JK&B Capital Kinetic Ventures Kitty Hawk Capital Mellon Ventures NBC Noro-Moseley PanAmSat Introduction Introduction Opportunity People Performance Portfolio Process Summary 17

  18. Classic Fund Structure • Limited Partnership. • 2.5% management fee. • 80/20 carried interest after payback of committed capital. • Intent to comply with ERISA regulations. Introduction Opportunity People Performance Portfolio EGL Ventures Confidential Process Summary

  19. Why Us? Why Now? A team that: • Transcends adversity • Seizes opportunities • Delivers on expectations … with the experience to make it happen. Introduction Opportunity People Performance Portfolio EGL Ventures Confidential Process Summary

  20. EGL Ventures IV Placement Agent: Ariane Capital Partners 501 Candace Lane Suite 100 Villanova, Pennsylvania 19085 (610) 525-0749 www.arianepartners.com EGL Ventures 3495 Piedmont Road Ten Piedmont Center Suite 412 Atlanta, Georgia 30305 (404) 949-8303 www.eglventures.com

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