1. - 1 - LIfeCycle Returns, Inc. © 2004 All Rights Reserved COMPARATIVE ACCURACY OF DIVIDEND DISCOUNT MODELS By Adam Gehr, Professor, DePaul University Rawley Thomas, President, LifeCycle Returns March 12, 2004 agehr@mozart.depaul.edu Rawley@LCRT.com

2. - 2 - LIfeCycle Returns, Inc. © 2004 All Rights Reserved Comparative Accuracy of Dividend Discount Models 3-12-04 Rt AN EQUITY RISK PREMIUM (ERP) = 1.0 PRODUCES THE LOWEST TRACKING ERROR Sources: Financial Statements and Price Data – Simplystocks Calculations - LCRT’s Platform 2.010 Company-Years LOG 2 of % Absolute Model Error versus Actual Price - Fiscal Year +3 Months 1994-2002 54 61 78 Cumulative % of Universe Tracking error equals the % absolute difference between the Model Intrinsic Value and the actual stock price at Fiscal Year + 3 Months. The Chart compares models, methodologies, or parameters.

3. - 3 - LIfeCycle Returns, Inc. © 2004 All Rights Reserved Comparative Accuracy of Dividend Discount Models 3-12-04 Rt PRACTICALLY NO DIFFERENCE EXISTS BETWEEN MEDIAN INDUSTRY BETA’S, LCRT BETA’S OR BETA = 1.00 Sources: Financial Statements and Price Data – Simplystocks Calculations - LCRT’s Platform 2.010 Company-Years for Industry Beta & Beta = 1.00 1,989 Company-Years for LCRT Beta LOG 2 of % Absolute Model Error versus Actual Price - Fiscal Year +3 Months 1994-2002 52-54 Cumulative % of Universe Tracking error equals the % absolute difference between the Model Intrinsic Value and the actual stock price at Fiscal Year + 3 Months. The Chart compares models, methodologies, or parameters.

4. - 4 - LIfeCycle Returns, Inc. © 2004 All Rights Reserved Comparative Accuracy of Dividend Discount Models 3-12-04 Rt WITH THE SAME SAMPLE OF ~2,000 COMPANY-YEARS, LCRT IS 71.1% (=100%(53.7/31.4-1)) MORE ACCURATE THAN DDM AND 13.2% (=100%(53.7/47.4-1)) MORE ACCURATE FOR 20,947 LCRT COMPANY-YEARS WITH C$GI > 100 $MILLION Sources: Financial Statements and Price Data – Simplystocks Calculations - LCRT’s Platform 2.010 Company-Years for DDM 1,995 to 20,947 Company-Years for LCRT LOG 2 of % Absolute Model Error versus Actual Price - Fiscal Year +3 Months 1994-2002 31 47 54 Cumulative % of Universe Tracking error equals the % absolute difference between the Model Intrinsic Value and the actual stock price at Fiscal Year + 3 Months. The Chart compares models, methodologies, or parameters.

5. - 5 - LIfeCycle Returns, Inc. © 2004 All Rights Reserved Comparative Accuracy of Dividend Discount Models 3-12-04 Rt LCRT’S MODEL IS 90% MORE ROBUST THAN THE DIVIDEND DISCOUNT MODEL (DDM) LCRT DDM Sources: Financial Statements and Price Data – Simplystocks Calculations - LCRT’s Platform Constant Dollar Gross Investment > $100 Million