1. Plop, Plop, Fizz, Fizz, Oh What A Relief It Is!
TeleSoft Annual Meeting
Bill Brady Head of Global Technology Corporate Finance Credit Suisse First Boston Technology Group November 9, 2001

2. Agenda Changing Leaders in the Technology Market
Taming the Volatile Equity Markets
The New M&A Environment
4. What to Expect in the Future
5. Implications for Liquidity Options
6. CSFB Technology Group - The Clear Leader
Four companies fell off the chart from last year:
Seagate, Ascend, Parametric, & Micron Technology
Four Companies were added: Nokia, HBOC, AOL, & PeopleSoft.

3. Dramatic Growth in New Companies and Market Cap Technology Companies and Market Cap by Size Now vs. 1990
# Companies
Market Cap ($Bn)
Category
> $1 Bn
$100MM - 1Bn
< $100MM
322
$2,807
# Companies
Market Cap ($Bn)
582
$210 33
$194
118
$38
759
$23
134 $5
1990
2001
All
285
$237
1663
$3,040
16.5% CAGR
24.7% CAGR
Source: Factset based on data from 4/9/90 and 10/31/2001.

4. The Mighty Have Fallen… Top 40 US-Traded Technology Companies 1 year ago
Market Value ($BN)
Market Value ($BN)
10/31/2000
10/31/2001
%Change
10/31/2000
10/31/2001
%Change % %
Cisco Systems
Microsoft
Intel
Nokia
EMC
Oracle
Sun Microsystems
IBM
Nortel Networks
AOL Time Warner
Ericsson
Hewlett-Packard
Texas Instruments
Lucent Technologies
JDS Uniphase
Dell
Siemens
* Juniper Networks
Veritas
Alcatel
$387.4
366.1
302.9
186.3
216.9
220.4
178.5
174.8
136.6
117.0
110.9
90.6
84.9
78.9
78.3
76.4
75.5
61.9
57.6
57.5
$123.9
313.2
164.3
96.2
27.2
75.4
33.0
187.7
18.6
209.0
34.4
32.6
48.5
22.9
10.5
62.6
43.1
7.1
11.3
16.1
(68.0)
(14.4)
(45.7)
(48.4)
(87.5)
(65.8)
(81.5)
7.4
(86.4)
78.6
(69.0)
(64.0)
(42.9)
(71.0)
(86.6)
(18.1)
(88.5)
(80.4)
(72.0)
Motorola
* Broadcom
Compaq
TSMC
Phillips
Qualcomm
STMicroelectronics
* Siebel
Applied Materials
Automatic Data Processing
* Network Appliance
* Marconi PLC
* I2 Technologies
NEC
* Yahoo
* Ariba
* Palm
* Ciena
SAP
* Gemstar
TOTAL
$54.5
52.3
51.8
51.3
48.7
46.0
44.2
43.2
41.2
38.2
35.7
34.0
33.2
32.7
31.3
30.3
30.1
29.9
28.1
$3867.4
$36.2
8.6
14.8
42.3
29.6
37.4
25.0
7.5
27.8
32.2
4.4
1.2
2.0
15.2
6.2
0.8
1.4
5.3
18.2
8.4
$1862.2
(33.6)
(83.6)
(71.4)
(17.5)
(42.3)
(23.2)
(45.7)
(83.0)
(36.6)
(21.8)
(88.5)
(96.6)
(94.1)
(54.2)
(81.0)
(97.4)
(95.4)
(82.4)
(39.1)
(70.1)
(51.8)
Four companies fell off the chart from last year:
Seagate, Ascend, Parametric, & Micron Technology
Four Companies were added: Nokia, HBOC, AOL, & PeopleSoft.
Technology Group
* Companies not included in 2001 top 40 list.

5. This Year’s Leader Board Top 40 US-Traded Technology Companies Now
10/31/2001
Market Value
($BN)
10/31/2001
Market Value
($BN)
Microsoft
IBM
Intel
AOL Time Warner
Cisco Systems
Nokia
Oracle
Dell
Texas Instruments
Siemens
TSMC
Qualcomm
Motorola
Ericsson
Sun Microsystems
Hewlett-Packard
Automatic Data Processing
Electronic Data Systems
Philips
Applied Materials
$313.2
187.7
164.3
137.8
123.9
96.2
75.4
62.6
48.5
43.1
42.3
37.4
36.2
34.4
33.0
32.6
32.2
30.2
29.6
27.8
EMC
* First Data Corp
STMicroelectronics
Lucent Technologies
* UMC
Nortel Networks
SAP
* Computer Associates
Alcatel
NEC
* Maxim Integrated Products
Compaq
* Ebay
* Accenture
* Concord EFS
* Analog Devices
* Micron Technology
* Linear Technology
Veritas
JDS Uniphase
$27.2
25.8
25.0
22.9
18.7
18.6
18.2
17.8
16.1
15.2
15.1
14.8
14.3
14.1
13.7
13.6
12.4
11.3
10.5
Four companies fell off the chart from last year:
Seagate, Ascend, Parametric, & Micron Technology
Four Companies were added: Nokia, HBOC, AOL, & PeopleSoft. *
* Companies not included in 2000 top 40 list.

6. Moore’s Law of Nasdaq Ran Out of Gas in Y2K
January Present
Doubles in 1 year
Doubles in 2 years
Doubles in 4 years
Doubles in 8 years

7. Equity New Issue Market Technology Equity & Equity-Related Offerings, 1993-2001
$ Billions
100
168
410 44
366
240 51 27 66 57 49 60
111
221
124 61 35
145
226 40
206
295 78 30
147 96
US and Int’l Technology transactions completed.
Source: Securities Data Company as of 10/31/01.

8. Performance of Top IPOs of 1999 and 2000

9. Continued Volatility Results in Short Market Windows
# of Negative Pre-Announcements (1)
(1) 3 weeks into each quarter

10. M&A Market Technology Mergers & Acquisitions, 1993-2001
$ Billions
YTD
# of
Deals 35 65 95
120
164
228
487
833
289
Source: Securities Data Company as of 10/31/2001.
Incl. Domestic and Int’l transactions, pending or completed,
with transaction value >$50MM, excl. share repurchases.

11. Perceptions Towards Strategic Transactions Have Changed in This Difficult Market Environment…
THEN: MAY 1999
NOW: OCTOBER 2001
Accretion/Dilution
Acquirors willing to accept significant earnings dilution for promise of significant growth opportunity
Acquirors typically accept zero to small amount of earnings dilution in exchange for growth prospects
Little tolerance for cash burn
Valuation
Many bidders drove up valuation
Public market offered liquidity events for startups, driving up valuation
Few acquirors in this market
Public market more stringent; therefore, fewer startups obtaining liquidity
Time to revenue
Revenue could be more than one year away
Clear path to revenue and profitability
Must be at least in customer trial phase of development
Customer base
Potential for customers
Small base, many in trial stage
Highly concentrated revenue
Quality, well-financed and diversified customer base with recurring revenue stream

12. …Resulting in a Challenging Near-Term Environment
Current Status
Consolidation activity has slowed significantly from the torrid pace of early 2000
Operating issues have forced many traditional acquirers to focus internally
Market volatility has created uncertainty as to “true values” and hesitancy to make commitments
Uncertainty over proper valuation levels remains
Many sellers focused on last year’s valuations
Valuation analysis has returned to traditional earnings and cash flow based methodologies
Consolidators no longer playing with “funny-money”
Valuation
Public equity markets have become less forgiving of ill conceived or poorly executed transactions
Heightened scrutiny of both long term strategic and near term financial implications of any transaction
Integration plans must be well thought out and expertly communicated to the market at time of announcement
Earnings dilution is a major concern
Public Market Scrutiny

13. Many Potential Buyers Have Seen Their Share Prices Plummet Over the Last Year
PERCENTAGE CHANGE IN STOCK PRICE SINCE MARCH 1, 2000
Comm. Equipment
eBusiness
Internet Infrastructure
Nortel
Lucent
Alcatel
Cisco i2
Ariba C1
Siebel
Inktomi
Akamai
VeriSign
InfoSpace
Semiconductors
Optical
Internet
JDS Uniphase
New Focus
Intel
Broadcom
PMC-Sierra
Conexant
Sycamore
Corvis
Amazon
Yahoo!
AOL
eBay
Note: Corvis and New Focus data is from IPO Pricing of $36.00 and $20.00, respectively.
Let’s not forget the companies that have gone bankrupt:

14. SELECTED ACQUIRORS USING CASH AS ACQUISITION CURRENCY
As a Result, Companies Have Begun to Use Cash To Fund Their Acquisitions
With stock prices at record lows, the notion that cash is king is being reinforced
In particular, large cap companies with depressed P/Es are using cash as their preferred acquisition currency
Sellers prefer liquidity in these uncertain times
Interest rates are at unprecedented lows
Many companies are taking advantage of the convertible market’s tremendous appetite for technology issues to build “war chests”
SELECTED ACQUIRORS USING CASH AS ACQUISITION CURRENCY

15. VC Returns Under Pressure Cumulative Vintage Year Performance of U. S
VC Returns Under Pressure Cumulative Vintage Year Performance of U.S. Venture Capital Funds
Pooled IRR average % (09/30/00)
Pooled IRR average % (03/31/01)
Pooled IRR average % (12/31/00)
Source: Venture Economics Information Services

16. Market Rallies and Subsequent Downturns
8/1/82 -
12/13/84 -
10/28/87 -
10/11/90 -
12/9/94 -
10/8/98 -
MARKET RALLIES
6/22/83
8/21/87
10/9/89
3/18/94
7/20/98
3/10/00
Length 11 33 24 42 44 17
Trough to Peak:
NASDAQ
96%
91%
66%
147%
180%
256%
S&P 500
60%
108%
54%
59%
165%
45%
Range of S&P
11x – 13x
10x – 22x
11x – 15x
14x – 26x
15x – 29x
28x - 34x
500P/E Multiples
(1)
AND SUBSEQUENT
6/22/83 -
8/21/87 -
10/9/89 -
3/18/94 -
7/20/98 -
3/10/00 -
DOWNTURNS
12/13/84
10/28/87
10/11/90
12/9/94
10/8/98
10/31/01
Length 18 2 12 9 3 20
Peak to Trough:
NASDAQ
-27%
-36%
-33%
-11%
-30%
-67%
S&P 500
-5%
-31%
-18%
-5%
-19%
-24%
Range of S&P 500
9x – 13x
15x – 20x
14x – 16x
15x – 20x
24x – 28x
23x – 29x
P/E Multiples
(1)
Net Market Move
Net Market Move %
CAGR % %
CAGR %
NASDAQ
95%
8.5%
419%
16.1%
S&P 500
176%
13.2%
259%
12.3%
(1) Trailing P/E multiples.

17. Recessions Are Followed by Market Rallies
There have been 5 recessions in the U.S. since 1969
The average recession lasted for 12 months and resulted in a 2% contraction in GDP
During recessionary times, the S&P 500 has not demonstrated significant drops, except in ‘73 - ’75 (-23%)
Markets begin to recover one quarter before the trough and gain an average of 23% in the following 6 months
CSFB Technology Research anticipates that tech sectors should experience a recovery in the next 6 quarters, with a concentration during Q2 - Q3 of 2001
Overviews of Previous Recessions
Expected Timing of
Recovery by Sector

18. Implications Don’t Count On:
Return to “irrational exuberance” any time soon
Indefinite losses will be bankable
Me-too, undifferentiated companies will be bankable
Valuations on private financings will hold up
Plan To:
Focus on business model, sponsorship, uniqueness, barriers
Develop alternative financing plans, merger partners
Shift business models to accelerate profitability and cash flow
Finance ahead of needs when windows present themselves

19. The Bar is Set Higher for IPOs
$2 - 5MM $10MM
Time to Profitability Quarters Quarters
Valuation Metrics Revenue Multiples P/E Multiples
Revenue Base (in quarter going public)

20. Equity Private Placement Market Overview
Flat to down rounds
Months, not weeks to complete
Fully-funded business plans only
Fewer buyers
3-5x returns to IPO within 1-2 years

21. Current M&A Environment
Strategic rationale for M&A stronger than ever
Few deals near-term due to “reality distortion field”
Strategic buyers’ currency and confidence reduced
Sellers’ value expectations need to adjust
Financial buyers’ interest growing
Expect strong rebound in M&A as reality sets in

22. The Clear Leader in Technology Investment Banking
Total Technology
Financing and M&A
(Number of Deals)
Total Technology
Financing and M&A
(Dollars in Billions)
Notes:
Transactions announced 1/1/00 through10/31/01. Includes private placement deals.
(1) JP Morgan deals include deals completed by H&Q.

23. CSFB: Clear Winners Do Not Need Recounts
Reuters’ Survey of Fund Managers*
Ranking
Category
1st Place
2nd Place
Morgan Stanley
DLJ
Goldman Sachs
Quality of new equity issues
Pricing of new equity issues
Quality of research product and service in the aftermarket
Aftermarket performance of equity issues
Equitable allocation of new issue product
Due diligence on new issues
* In a survey dated July 19, 2000, Reuter’s surveyed 75 of the largest institutional managers of active US equity funds. Responses have been weighted by fund size.