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STRICTLY CONFIDENTIAL

UBS Technology M&ADiscussion of Current Industry Trends

March 2005

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Table of ContentsSECTION 1 SECTION 2 SECTION 3

M&A Market Conditions M&A Drivers and Considerations UBS Overview

2 8 14

1

SECTION 1

M&A Market Conditions

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M&A Volume in the USCurrent rebound in activity across all industries is reflective of a return to a healthier marketj Large, strategic combinations are backProctor & Gamble / Gillette, JPMorgan / BankOne, Cingular / AT&T Wireless, Sprint / Nextel, Oracle / PeopleSoft, Symantec / Veritas, Johnson & Johnson / Guidant and Wachovia / SunTrust j Significant financial sponsor activity in the middle market Taking advantage of depressed market conditions and attractive debt markets1,500 1,411 1,328 1,250 1,219

1,045 1,000

Volume up 41% in 2004 vs. 2003

($ in billion)

750 608 530 500 407 296 250 97 0 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 110 116 154 529 433

Source: Securities Data Corporation

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Technology M&A ActivityTechnology M&A olume Has Increased Steadily Since 2002 Lows

500 450 400 350 Deal Value (US$ Billions) $311 300 65 250 200 150 100 50 58 0 19971997 No. of Deals 1,133

$485 95

> $10bn $1bn - $10bn < $1bn No. of Deals

3,000

2,500

2,000 No. of Deals 233 1,500

$143 25 $85 26 60

148 $124 24 157 98 36 65 20002000 2,648

1,000 $103 $65 19 46 20022002 1,318

$64 17 47 20032003 1,329

22 15 65

500

58 19981998 1,409

0 19991999 1,862

20012001 1,705

20042004 1,508

Source: Securities Data Corporation Note: Oracle/PeopleSoft included as 2004 transaction, original hostile offer was first launched in Q3 2003

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M&A Deal Activity is IntensifyingMarket recovery in 2003 and stability in 2004 have increased cor orate confidence and created an environment conducive to M&A transactionsj Technology companies are exiting defensive, "survive the downturn" mentality and reviewing strategic options Recalibrating under invested businesses Capturing upside as economic conditions continue to improve j Technology M&A deal volume increased 60% in 2004 M&A pipeline is expected to be strong for 2005 Number of Announced Transactions 1500 400 300 200 100 Q1 Q2 Q3 2003 Q4 Q1 Q2 2004 Q3 Q4 281 325 352 371 399 370 394 345

Technology M&A Deal olume (US$ Billions) 1120 100 80 60 40 2002 2003 2004 $64.9(1% ) 60%

102.6

$64.2

j 179 additional transactions were announced in 2004 compared with 2003 j Volume of discussions has intensified drasticallySource: Security Data Corporation Note: 1 Oracle/PeopleSoft included as 2004 transaction, original hostile offer was first launched in Q2 2003

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Current Trends in Technology M&ATREND VERVIEWri j A recover in technology stock prices and increased corporate confidence cti ity p i s r structur t ir usi sses i creased ear i s panies are eager t ake acquisiti ns t capture upside as arket c nditi ns i pr e arked t e return of the Technology A ega-deals j eals er illi n represented f deal alue in , ersus in eturn f landscape shaping deals such as y antec/ eritas, / rtisan and the c pleti n f racle/ eopleSoft j Sector consolidation continues to drive A s companies refocus on growth, they are seeking opportunities to expand product offerings, acquire new technology and achieve critical mass egulatory environments created product opportunities for acquirors and at the same time forced smaller listed firms to re-assess the pros and cons of operating on a standalone asis j Stock consideration has ecome a more favorable A currency as technology stock prices have recovered ost technology companies have een trading at or close to their three -year highs j In some recent deals, cash consideration has een linked to stock consideration as acquirors tap into the equity markets to raise funds for acquisitions Improvements in capital markets have allowed companies to raise cash at a low cost through converti les or straight equity j Private equity players continue to show interest in acquiring technology companies Some technology stocks have enjoyed only limited participation in the market recovery ow interest rates have enabled private equity players to borrow at low costs to fund acquisitions The downturn has created companies with lower cost structures and higher profitability The recent market recovery has provided private equity players with better exit opportunities

RECENT TRANSACTI NSj I / scential ( , j Sy antec / eritas ( j enovo roup / I ( , ) j / etegrity ( j Juniper / etscreen ( j racle / eoplesoft ( j / rtisan ( j j j

Sector Consolidation

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Private Equity Activity

arlyle / Insight ( , mm) olden ate apital / lue artini ( mm) j eritas apital / ynCorp from CSC ( mm) j ain Capital, Silver ake Partners, arbug Pincus / S PLM from S( , mm)

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Stock Consideration

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Resur ence in Deal Acti it

om / TippingPoint ( mm) j redence / PTest ( mm) j Serena / erant ( mm) j isco / etSolve ( mm) j m) j Symantec / eritas ( j , mm) j Safenet / ainbow ( mm) j redence / PTest ( mm) Issued convertible j Serena / erant ( mm) Issued convertible

r t x s vwrt ryyt x s wvut sr d PPRReG F E F PPIIR IH G W c PPbH a RG Y PPH S`G Y FX PPIIR H G U V P F ED)

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6

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M&A and IPO Activity in the Technology SectorNumber of Announced M&A Transactions and IPO Filings3,000 30 2, 00eals

3 0 2, 4

300

23 ,

2 0 , 0

No. of Announced M&A

, 0

, 33

24 00

0

0 M&A IPO

Source: Securities Data Corporation and UBS E uity Capital Markets Group Note: Oracle/PeopleSoft included as 2004 M&A transaction, original hostile offer was first launched in Q3 2003

~

2000

200

2002

2003

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23

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2004

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2,000

2No. of IPOs Filed

200

0 00 07

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SECTION 2

M&A Drivers and Considerations

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Principal Drivers of Technology M&A

j Critical mass and financial strength

Achieve Scale

j Customer leverage j Increased distribution and sales support j Market position consolidation j Leapfrog competition j New market entry product or geography

Expand Product Offering

j Capture new customer bases j Buy vs. make time to market j Engineering talent and/or management ac uisition j Off-income statement R&D j Fill product gaps

Offer Complete Solution

j Capitalize on installed base j Accelerate time to market j Strengthen channel partnerships j Offer one-stop shop

9

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M&A ConsiderationsA number of factors to consider in pursuing any M&A transaction

Business Rationale

j Compelling strategic rationale j Create or consolidate market leadership position j ssential new technologies, markets or products j Transaction multiples compared to public comparables and precedent transa ctions

Financial Considerations

j Impact on combined company revenue and earnings growth trajectories j ffect on margins j evenue and cost synergies j PS accretion / dilution j Market perception of target company / merger partner

M arket Reaction

j Consistent, simple to understand story j inancial parameter clarity j Price paid / consideration mix j Time to closure

Execution Risk

j nti-trust / regulatory j Tight contract terms j Integration strategy

10

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Process ConsiderationsPublic Offering ersus Sale

Initial Public Offering PROS: j Primary shareholders retain voting control and existing management continues to exe