pitch book

Presentation to

Review of AviatorApril 2006

Table of ContentsSection 1A B C D E F G H

Review of AviatorBusiness Overview Historical Stock Price Performance Wall Street Coverage Current Valuation Historical and Projected Financial Review Officer and Director Profile Shareholder Profile Aviator Corporate Profile

2A B C D

Valuation of AviatorAviator Top-Down Valuation Aviator Sum-of-the-Parts Valuation Enterprise Communications Group Valuation Enterprise Services Valuation

3A B CONFIDENTIAL

Pro Forma Merger ConsequencesNortel Acquires AviatorTransaction Considerations Pro Forma Merger Consequences 8202529, v1

Section 11

Review of Aviator

Section 1-12

Business Overview

Snapshot of AviatorSummary Income StatementFY Ending 9/30 2003A 2004A 2005E 2006E

($ in millions)2007E

Revenue Growth % EBIT Operating Margin %

$3,796.0 NA $63.0 1.7 %

$4,069.0 7.2 % $324.0 8.0 %

$4,934.0 21.3 % $320.7 6.5 %

$5,316.0 7.7 % $393.4 7.4 %

$5,635.0 6.0% $495.9 8.8%

AviatorAviator is a leading provider of communications systems, applications and services that help enterprises transform their businesses by redefining the way they work and interact with their customers, employees, business partners, suppliers and others. Aviator aims to help its customers optimize their enterprises in order to serve their own customers better, enabling them to reduce costs and grow revenue while preserving the security and reliability of their networks. A key component of Aviators strategy is to leverage its substantial experience and expertise in traditional voice communications systems to capitalize on the transition of these traditional voice systems to IP telephony systems. Aviator believes its comprehensive suite of IP telephony systems, communications applications and appliances transforms the enterprise communications system into a strategic asset of its customers.

Global Communications Solutions (51% Revenue)

Global Services (49% Revenue)

Large Communications Systems

Maintenance

Small Communications Systems

Implementation and Integration Services

Converged Voice Applications

Rental and Managed ServicesDraft of 8202529, v1, printed 10/14/2008 10/14/2008

CONFIDENTIAL

40

AviatorGlobal Communications SolutionsSummary Income StatementFY Ending 9/30 2004A 2005E 2006E



$2,048.0 NA $71.0 3.5 %

$2,275.3 11.1 % $110.6 4.9 %

$2,450.1 7.7 % $146.0 6.0 %

$2,597.1 6.0% $189.4 7.3%

Global Communications SolutionsGlobal Communications Solutions sells communications systems and converged voice applications designed for both large and small enterprises. Aviators offerings in this segment include IP telephony systems, multi-media contact center infrastructure and applications in support of customer relationship management, unified communications applications and appliances, and traditional communications systems.

Large Communications Systems Media servers Media gateways Telephone handsets Contact Center Solutions Extension to Cellular

Small Communications Systems Aviator IP Office Telephone handsets Media servers for voice applications

Converged Voice Applications Voice messaging Unified messaging products Other applications that facilitate and enhance interaction in an enterprise with customers, partners, suppliers and employees

CONFIDENTIAL

Draft of 8202529, v1, printed 10/14/2008 10/14/2008

40

AviatorGlobal ServicesSummary Income StatementFY Ending 9/30 2004A 2005E 2006E



$1,761.0 NA $249.0 14.1 %

$2,658.7 60.0 % $210.1 7.9 %

$2,865.9 7.8 % $249.0 8.7 %

$3,037.9 6.0 % $306.5 10.1 %

Global ServicesGlobal Services is focused on supporting Aviators customer base with comprehensive, end-to-end global service offerings that enable customers to plan, design, implement, monitor and manage their converged communications networks worldwide.

Maintenance Monitors and optimizes customers network performance to ensure availability. Keeps enterprise communications networks current with the latest software releases, and, in the event of an outage, provides on-site support to help customers recover rapidly.

Implementation and Integration Services Helps customers leverage and optimize their multi-technology, multi-vendor environments. Helps enterprises assess, design and install traditional and IP telephony networks, contact centers and unified communications networks.

Rental and Managed Services Supports customers in-house staff and manages complex, multi-vendor, multitechnology networks. Optimizes network performance and configurations, backs up systems, detects and resolves faults, performs moves, adds and changes and manages customers trouble tickets and inventories.

CONFIDENTIAL


40

AviatorMarket Share AnalysisBusiness Area North America Geographic Region EMEA APAC

1 2 3 4 5 6 1 2 3 4 5 6 1 2 3 4 5 6 1

Nortel Aviator NEC Mitel Cisco Inter-Tel Cisco Aviator HP Northrop Grumman Verizon IBM Nortel Aviator Polycom Cisco IBM Microsoft Aviator Nortel Siemens Aspect

26% 21 10 5 5 5 8% 7 5 5 4 3 12% 12 4 2 1 1 36% 22 7 5

1 2 3 4 5 6 1 2 3 4 5 6 1 2 3 4 5 6 1 2 3 4

Siemens Alcatel Aviator Ericsson Nortel Samsung HP NextiraOne Siemens Cisco Nokia IBM Aviator Nortel Polycom IBM Cisco Microsoft Aviator Nortel Alcatel Aspect

16% 15 11 10 8 4 8.3% 5.0 4.5 3.9 3.5 3.4 11% 9 6 2 1 1 31% 23 11 5

1 2 3 4 5 6 1 2 3 4 5

NEC Fujitsu Oki Samsung Nortel LG Electronics Fujitsu HP Cisco IBM NEC

22% 9 7 5 5 5 11% 8 7 5 4

Voice

Services

Not Available

Applications

1 2 3 4

Aviator Nortel NEC Huawei

55% 20 4 3

Call Center

2 3 4

CONFIDENTIAL


40

AviatorProduct ComparisonReview of Large IP PBXs (1,000 + Stations)(1)Ratings Aviator S8710 Media Server, G650 Gateway Cisco IP Communications System Alcatel OmniPCX Enterprise ShoreTel ShoreTel5 Siemens HiPath 4000

Architecture(2) Endpoints(3) Management and Admin Features(5) (4)

15 20 15 20 10

14 20 11 17.5 8.5 19 90

12 19.5 12 17.5 9 17 87

12 19 12.5 15 5 20 83.5

10.5 17.5 11.5 17 5 16.5 78

11 18 11.5 16.5 5.5 13 75.5

Security(6) Performance Total(7)

20 100

Source: McKinsey Report.

CONFIDENTIAL


40

Aviators Challenges in Enterprise Voice

Source: BCR, January 2005. (1) Nortel declined the invitation to participate. (2) Includes: Call-control survivability; redundancy and fallover; IP-to-PSTN re-routing, VoIP bandwidth control; QOS support; scalability, standards support and interoperability; and distributed-system networking. (3) Includes verification of endpoint support: IP hard phone, softphone, wireless, analog/fax support, Power-over-Ethernet; unique, specialty and advanced endpoint features, including video. (4) Based on management task completion, interface navigability and intuitiveness, on-screen help, real-time monitoring, reports and reporting. (5) Includes: Validation of 16 basic phone features; verification of common add-on subsystems (E911, voice mail, voice recognition/response, etc.), and evaluation of special and unique advanced features. (6) Includes: Verification of encrypted call control, VoIP/RTP stream encryption, secure management access, vendors security documentation, services, security-infrastructure offerings and affiliations. (7) Includes: Traffic load/call-completion testing, interactive/MOS voice-quality tests, latency measurements, verification of high-availability features.

CONFIDENTIAL


40

Protecting its current installed base of voice customers

Risk of technology substitution from open standard IP-based technologies that could eliminate the need for specialized voice vendors (Commoditization Effect)

Dealing with the threat from IP-Centrex offerings, especially as service providers look for new revenue platforms

Well funded competitors like Cisco with significant data credibility

Changing financial metrics as customers migrate to IP

CONFIDENTIAL


40

AviatorSummary of Recent Acquisitions($ in millions)Date Target Amount Paid Description

2004 12/15/04 11/18/04 10/04/04 08/04/04 2003 11/26/03 10/02/03 2001 04/12/01 03/07/01 02/14/01

Route Science Tenovis Germany GmbH Spectel Tata Telecom (now Aviator GlobalConnect Ltd.) Expanets VISTA Information Technologies, Inc. Quintus Corporation Cyber IQ Systems VPNet Technologies, Inc.

$7 M 371 M 106 M 18 M

A maker of adaptive networking software (ANS) for enterprises and service providers. A European-based provider of enterprise communications systems and services. A provider of audio and web conferencing solutions. An India-based communication solutions provider and a distributor of Aviator products in India. A provider of converged communications for mid-sized businesses, and one of the largest resellers of Aviators products in the United States. An IT services business unit that develops Java-based software for contact center platforms, interactive voice response systems, and CRM software. A provider of electronic customer relationship management (eCRM) solutions. Developer of data networking products including HyperCommerce, CyberSSL and MonsterSSL. A privately held developer of virtual private network (VPN) solutions and devices.

152 M NA

30 M NA 120M

CONFIDENTIAL


40

Section 1-23

Historical Stock Price Performance

Aviator Stock Price PerformanceDaily: May 9, 2004May 9, 200560,000 50,000 40,000 A E G F C D $20.00 18.00 16.00 14.00 H I J 12.00 10.00 8.00 6.00 7/04 9/04 11/04 1/05 3/05 5/05

Volume

Price

30,000 20,000 10,000 0 5/04

B

VolumeA B 05/24/04: 07/06/04: Announced a voluntary contribution of approx. $111M of its common stock to its pension plan. Announced it had completed cash repurchases of $131.6 million in principal amount of its 11 1/8% senior secured notes during the third fiscal quarter. Announced Q3 04 EPS of 16 cents versus consensus estimates of 12 cents. Announced Q4 04 EPS of 19 cents versus consensus estimates of 18 cents. Provided guidance for fiscal year 2005 including an operating margin between 8.59.0% and revenue growth between 2527% compared to fiscal 2004 revenues of $4.1B. Commenced a cash tender offer for any and all of its 11-1/8% Senior Secured Notes due 2009.

PriceG 11/18/04: Announced a redemption for cash all of its outstanding Liquid Yield Option Notes due 2021 (LYONs) on December 20, 2004. The redemption price was $545.67 per $1,000 principal amount at maturity of LYONs. Announced Q1 05 EPS of 17 cents versus consensus estimates of 18 cents. Announced the successful completion of a new $400 million five-year unsecured revolving credit facility and the reduction of secured floating rate notes associated with the Tenovis acquisition. Announced Q2 05 EPS of 9 cents versus consensus estimates of 18 cents.

H I

01/25/05: 02/24/05:

C D E

07/27/04: 10/26/04: 10/28/04:

J

04/19/05:

F

11/01/04:

Indexed Stock Price PerformanceIndexed Comparison GraphDaily: May 9, 2003May 9, 2005130% 120 110 100 90 80 70 60 50 5/04 7/04 9/04 11/04 1/05(1)

130% 120 110 100 90 80 70 60 50 5/05(2)

3/05

Aviator

NASDAQ

Global Communications Equipment Composite

Global Enterprise Services Composite

Source: Thomson One Banker and Company press releases.

Section 1-34

Wall Street Coverage

Source: Thomson One Banker. (1) Peer group includes Alcatel, Aspect, Cisco, Inter-Tel, InterVoice, Nortel and Polycom. (2) Peer group includes Black Box, Convergys, CGI Group, Getronics and Unisys.

Wall Street CommentaryDespite the earnings miss and pressure on the shares this morning, we still see some downside risk in sales and margins for the next several quarters. We believe that the year-over-year decline for core Aviators sales highlights sales of IP telephony products mostly just cannibalizes sales of traditional telephony products and the enterprise telephony industry as a whole has shown and is likely to continue to show limited growth. Jiong Shao, Lehman Brothers (April 20, 2005) We believe that most of the issues are temporary, the Tenovis integration wiped out almost 50% of this quarters EPS and service revenue weakness explains the rest. The Tenovis integration had a highly detrimental effectcontributing a loss of $28m in the quarter. The integration of this company is clearly proving to be a more challenging task than envisioned by the company. Tal Liani, Merrill Lynch & Co. (April 20, 2005) Despite these reductions to our top-line forecast and an assumed market-even growth outlook in our discounted cash flow model we still view the shares as grossly undervalued by the market. While we certainly acknowledge a lower bar has been set with the disappointing results for F2Q, we do not believe the current stock price fairly represents the companys cash-generating potential over the longer term. Timm Bechter, Legg Mason (April 20, 2005) We are maintaining our Neutral rating as we expect the current pause in VoIP demand to continue through calendar 2005. We believe that organic growth could be flat year-over-year with flat-to-down gross and net margins. We do not expect VoIP sales to be robust enough to overcome the declining legacy TDM business, in order to give Aviator significant growth to warrant a buy rating. Gina Sockolow, The Buckingham Research Group (April 20, 2005)

Aviator Analyst CoverageAnalyst Bank Rating Price Target Date

Tavis McCourt Gina Sockolow Jiong Shao Scott Coleman Long Jiang Frank Marsala Ehud Gelblum Manuel Recarey Timm Bechter Eric Buck Jason Ader Christin Armacost Samuel Wilson Inder Singh B. Alex Henderson

Morgan Keegan Buckingham Research Group Lehman Brothers Morgan Stanley UBS First Albany JP Morgan Kaufman Brothers Legg Mason Janco Partners Thomas Weisel SG Cowen JMP Securities Prudential Smith Barney

Market Perform Neutral Neutral Attractive Buy 2 Neutral Neutral Buy Buy Market Perform Peer Perform NA Strong Buy Overweight Buy

NA NM $7.40 16.00 13.00 NA NA 12.00 21.00 9.00 NA NA 20.00 14.00 20.00

05/03/05 04/25/05 04/21/05 04/20/05 04/20/05 04/20/05 04/20/05 04/20/05 04/20/05 04/20/05 04/20/05 04/20/05 04/20/05 04/20/05 04/13/05

Section 1-45

Current Valuation

Current ValuationAviator($ in millions, except per share data)Stock Price Current Value Selected Balance Sheet Items (3/31/05)

Stock Price (5/27/05)

$9.53

Fully Diluted Shares

489.298(1 )

Cash

$688.3

52-week High 52-week Low AverageLast 30 days

17.76 7.76 9.00

Equity Value Enterprise Value

$4,663.0 3,996.7

Total Debt Shareholders Equity Total Debt/Total Capitalization

22.0 1,238.3 1.7 %

Analyst Estimates

Net Income

Revenue

EBITDA

EBIT

CY 2007E CY 2006E CY 2005E

$396.2 367.3 296.8

$5,719.5 5,395.8 5,029.5

$788.9 686.9 626.4

$513.8 419.0 338.9

Current Value as a Multiple of:

Equity Value/ Net Income

Revenue

Enterprise Value/ EBITDA

EBIT

CY 2007E CY 2006E CY 2005E

11.8x 12.7 15.7

0.70x 0.74 0.79

5.1x 5.8 6.4

7.8x 9.5 11.8

Section 1-56

Historical and Projected Financial Review

(1)

Based on 477.043 million basic shares and 20.696 million in-the-money options with a weighted average strike price of $3.89.

Aviator Historical Financial ReviewHistorical Income Statement DataFiscal Year Ending September 30 2002 2003 2004 LTM 3/31/2005

($ in millions)6 Months Ended 3/31/05

Revenues % Growth Cost of Sales Gross Profit % Gross Margin Operating Expenses Operating Income % Operating Margin Other Income (expense), net Interest Expense Pretax Income Income Taxes (Benefit) Effective Tax Rate Net Income from Cont. Operations

$4,387.0 NA $2,523.0 $1,864.0 42.5 % $2,218.0 ($354.0 ) (8.1 %) 1.0 (51.0 ) ($404.0 ) $273.0 NM (677.0 )

$3,796.0 (13.5 %) $2,157.0 $1,639.0 43.2 % $1,576.0 $63.0 1.7 % (29.0 ) (78.0 ) ($44.0 ) $84.0 NM (128.0)

$4,069.0 7.2 % $2,124.0 $1,945.0 47.8 % $1,621.0 $324.0 7.9 % (15.0 ) (66.0 ) $243.0 ($49.0 ) NM 292.0

$4,462.0 NM $2,330.0 $2,132.0 47.8 % $1,780.0 $352.0 7.9 % (40.0 ) (41.0 ) $271.0 $43.0 15.9 % 228.0

$2,370.0 NM $1,264.0 $1,106.0 46.7 % $966.0 $140.0 5.9 % (38.0 ) (15.0 ) $87.0 $18.0 20.7 % 69.0

Diluted EPS EBITDA % EBITDA Margin

($2.47 ) ($158.0 ) (3.6 %)

($0.34 ) $234.0 6.2 %

$0.64 $471.0 11.6 %

$0.48 $567.4 12.4 %

$0.15 $287.4 12.1 %

Aviator Current Balance SheetBalance Sheet as of March 31, 2005Cash and Cash Equivalents Receivables Inventories Deferred Income Taxes, net Other Current Assets Total Current Assets Property, Plant and Equipment Deferred Income Taxes, net Goodwill Other Intangible Assets Other Assets Total Assets Accounts Payable Debt Maturing within one year Payroll and Benefit Obligations Deferred Revenue Other Current Liabilities Total Current Liabilities Long-Term Debt Benefit Obligations Deferred Income Taxes, net Other Liabilities Total Non Current Liabilities Total Shareholders Equity Total Liabilities and Shareholders Equity

($ in millions)$855 793 364 69 139 $2,220 $747 360 939 390 187 $4,843 $403 74 289 234 365 $1,365 114 1,595 119 411 $2,239 1,239 $4,843

Source: Company 10-K for period ended September 30, 2004 and Press release for period ended March 31, 2005. Shown as reported.

Aviator Financial ReviewIncome Statement SummaryFYE September 30, 2003A 2004A 2005E ($ in millions, except per share data) 2006E 2007E

Revenue % Growth EBITDA % Margin EBIT % Margin Diluted EPS(1) % Growth First Call EPS LTGR

$3,769.0 NA $229.0 6.1 % $58.0 1.5 % NA NA 10.0 %

$4,069.0 8.0 % $471.0 11.6 % $324.0 8.0 % $0.64 NA

$4,934.0 21.3 % $615.4 12.5 % $320.7 6.5 % $0.54 (15.5 %)

$5,316.0 7.7 % $659.5 12.4 % $393.4 7.4 % $0.70 29.4 %

$5,635.0 6.0 % $769.2 13.7 % $495.9 8.8 % $0.78 11.3 %

Source: Earnings release for period ended March 31, 2005.

Section 1-67

Officer and Director Profile

Source: Aviator public filings, Wall Street research, and Bear Stearns estimates. (1) Based on 480.014 million basic shares and 20.696 million in-the-money options with a weighted average strike price of $3.89.

Aviator Organizational ChartDonald K. Peterson Chairman & Chief Executive Officer

Jocelyne J. Attal Chief Marketing Officer

Pamela F. Craven Sr. Vice President, General Counsel & Secretary

Louis J. DAmbrosio Group Vice President, Global Sales and Channels and Marketing

Maryanne DiMarzo Sr. Vice President, Human Resources

Patricia R. Hume Global Vice President, Small and Medium Business Solutions

David P. Johnson Group Vice President, Europe, Middle East and Africa

Thomas A. Lesica Group Vice President, Global Information Technology and Business Operations

Karyn Mashima Sr. Vice President, Strategy and Technology

Garry K. McGuire Chief Financial Officer and Sr. Vice President, Corporate Development

Francis M. Scricco Group Vice President, Avaya Global

Ravi Sethi President, Avaya Labs

Michael C. Thurk Group Vice President, Enterprise Communications Group

Director Profile(1)Board CompositionInsiders Outsiders Total 1 10 11 9.1 % 90.9 100.0 %

Directors

Director Since

Term Expires

Age

Position

Description

Beneficial Ownership/ (% O/S)

Donald K. Peterson

2002

2007

55

Chairman and CEO

Previously, Mr. Peterson had been executive vice president and chief financial officer of Lucent Technologies from 1996-2000. He has also served in various capacities at Northern Telecom, State Mutual Life Assurance Company and Nortel. He is a member of the board of directors of Reynolds and Reynolds Co.; a member of the board of trustees of Worcester Polytechnic Institute; a member of the Council on Foreign Relations; a member of the World Economic Forum; a member of the board of overseers of the Amos Tuck School of Business Administration, and a trustee for the Committee for Economic Development. Mr. Landy has been co-president of Warburg Pincus LLC since January 2002 and a managing general partner since October 2002. Mr. Landy is also a member of the board of Indus International Inc., Neustar, Inc., The Cobalt Group and ezGov, Inc. Mr. Leslie is currently the managing director of Leslie Ventures, a private investment company. He is also an adjunct professor at Stanford Graduate School of Business and Stanford UniversityGraduate Engineering. Mr. Leslie served as chairman of the board of Veritas Software Corporation until December 2001 and remains on the board as a director. Mr. Leslie has also worked at Leslie Consulting (owner) and Rugged Digital Systems (CEO). Mr. Leslie is a director of WebEx Communications, Inc. and a number of privately held high-technology corporations. Mr. Terracciano is vice chairman, American Water Works Company, Inc. and is the former chairman of Dime Bancorp. He has held executive positions with First Union Corporation, First Fidelity Bancorporation, Mellon Bank Corp. and Chase Manhattan Bank. Mr. Bond is the former chairman and CEO of PictureTel Corporation. Mr. Bond is a retired global telecommunications executive with 23 years of experience in the Bell System, including Ohio Bell, AT&T, US West and Mountain Bell. He has also spent six years with British Telecom, in London, UK, responsible for transforming the Products and Services Group as well as leading the National Business Communications Group.

5,784,834 1.3%

Joseph P. Landy

2003

2007

43

Co-president of Warburg Pincus

70,095 NM 98,721 NM

Mark Leslie

2001

2007

58

Managing director of Leslie Ventures

Anthony P. Terracciano

2003

2007

65

Vice Chairman, American Water Works Company

148,343 NM

Bruce R. Bond

2002

2006

58

Former chairman and CEO of PictureTel Corporation

49,908 NM

Director Profile(1) (cont.)Director Since Term Expires Beneficial Ownership/ (% O/S)

Directors

Age

Position

Description

Dan C. Stanzione

2000

2006

59

President Emeritus, Bell Laboratories and former COO of Lucent Technologies Chairman and CEO of Bausch & Lomb

Dr. Stanzione, president emeritus, Bell Laboratories, served as chief operating officer of Lucent Technologies, Inc. from November 1997 to October 1999 and as the president of Bell Laboratories at Lucent. Dr. Stanzione is also a director of Quest Diagnostics, Inc. Mr. Zarrella is chairman and CEO of Bausch & Lomb. He was president of General Motors North America before returning to Bausch & Lomb as chairman and CEO in November 2001. He was previously with Bausch & Lomb from 1985 through 1994, first as president of its international division, then as president and COO. Mr. Zarrella is also a member of the board of US FIRST (For Inspiration and Recognition of Science and Technology). Mr. Odeen is the retired chairman of TRW Inc. Mr. Odeen was president and chief executive officer of BDM, which TRW acquired in 1997, and directed its growth and evolution as a multi-national information technology (IT) firm. Mr. Odeen has served in senior positions with the Office of the Secretary of Defense and the National Security Council staff. Mr. Odeen is also a member of the board of Convergys Corporation, The Reynolds and Reynolds Company and WGL Holdings, Inc. Ms. Runtagh is the former president and CEO of Berwind Group, an enterprise with businesses in multiple industries. Prior to joining Berwind, from 1997 to 2001, Ms. Runtagh held senior level positions at Universal Studios and General Electric Company. Ms. Runtagh is also a member of the board of Covad Communications Group and Lincoln Electric Holdings. Dr. Stern is chairwoman of The Stern Group, Inc., an economic analysis and international business and trade advisory firm. She is currently a member of the US Presidents Advisory Committee for Trade Policy and Negotiations and previously served as chairwoman of the US International Trade Commission. Dr. Stern is also a member of the board of Avon Products, Inc., Hasbro, Inc. and The Neiman Marcus Group. Mr. Wallman is the former senior vice president and chief financial officer of Honeywell International Inc. Mr. Wallman previously served as chief financial officer of AlliedSignal Inc., prior to its merger with Honeywell. He also held various positions at IBM Corporation and Chrysler Corporation. Mr. Wallman is also a member of the board of Ariba, Inc., ExpressJet Holdings, Inc., Hayes-Lemmerz and Lear Corporation.

125,942 NM 64,939 NM

Ronald L. Zarrella

2002

2006

54

Philip A. Odeen

2002

2005

69

Retired Chairman of TRW Inc.

125,131 NM

Hellene S. Runtagh

2003

2005

56

Former President and CEO of Berwind Group

51,908 NM

Paula Stern

2002

2005

59

Chairwoman of The Stern Group, Inc.

51,213 NM

Richard F. Wallman

2003

2005

53

Former Senior Vice President and Chief Financial Officer of Honeywell International Inc.

14,016 NM

(1)

Source: January 4, 2005 Proxy and Company Website.

Section 1-78

Shareholder Profile

(1)

Source: January 4, 2005 Proxy and Company Website.

Aviator Shareholder ProfileInstitutional Ownership(1) Shares Held % of Total

Warburg Pincus(2) Dodge & Cox Fidelity Management & Research Lord, Abbett & Co. Barclays Global Investors Friess Associates SSgA Funds Management Vanguard Group Wellington Management AIM Management Group Calamos Advisors Top 10 Institutions Top 15 Institutions Top 20 Institutions All Other Institutions Total Institutions Insider Ownership Donald Peterson Louis DAmbrosio Michael Thurk

47,955,205 24,811,519 16,979,323 16,214,594 15,082,667 12,913,000 11,960,949 11,883,167 11,103,715 10,080,020 7,282,718 186,266,877 216,434,130 236,594,164 131,293,886 367,888,050

10.0 % 5.2 3.5 3.4 3.1 2.7 2.5 2.5 2.3 2.1 1.5 38.8 % 45.1 49.3 27.4 76.6 %

1,250,174 328,500 214,130 1,792,804 1,013,384 2,806,188

Other Officers and Directors Total Insiders

0.3 % 0.1 0.0 0.4 % 0.2 0.6 %

Other Shareholders Basic Shares Outstanding

109,320,035 480,014,273

22.8 100.0 %

Section 1-89

Aviator Corporate Profile

(1) (2)

Source: LionShares. Holdings obtained at a cost basis of approximately $9.16 per share.

Aviator Profile(1)State of Incorporation Headquarters Capital Stock

Delaware Basking Ridge, NJ 1,700,000,000 authorized common shares (480,014,016 basic shares outstanding). 200,000 authorized preferred shares (none outstanding). Annual Meeting: Exact date and time determined by Board of Directors (usually February). Special Meeting: Special shareholder meetings can be called by (i) the Chairman of the Board or (ii) the majority of the directors of the Board. Shareholders can not call special meetings. Notice: Notice of a meeting must be given to all shareholders entitled to vote at least 10 business days but not more than 60 days in advance of the meeting. Record Date: Determined by the Board of Directors; may not be more than 60 days prior to nor less than 10 days before the related shareholder meeting, dividend, or other distribution. Business: Must be brought before meeting by (i) Board of Directors or presiding officer or (ii) on behalf of any stockholder of record who submits a timely request by certified mail (return receipt requested) that the proposal be included in the Companys proxy statement. Such shareholder requests must comply with the provisions of Rule 14a-8 of the SEC act of 1934, as amended.

Shareholder Meetings

Aviator Profile (cont.)(1)

Directors

Number: Currently eleven directors; number determined by majority vote of directors then in office. Board must consist of at least three directors. Staggered Terms: Yes. Nomination: New Directors can be nominated by (i) the Board or (ii) any shareholder who provides proper and timely notice. For notice to be proper and timely, written notice must be made to the Secretary of the Corporation not later than the close of business on the 45th calendar day nor earlier than the close of business on the 75th calendar day prior to the first anniversary of the preceding years annual meeting. Vacancies: Vacancies and newly created directorships are filled by a majority of the directors then in office, including vacancies as a result of removal or an enlargement of the board. Removal: Any or all Directors may be removed for cause by a majority of shareholders at any annual or special shareholder meeting. No (default Delaware state statute). Yes; unanimous written consent of shareholders required (default Delaware statute).

Cumulative Voting Shareholder Action by Written Consent Actions Requiring Super Majority Shareholder Vote

80% shareholder vote required to amend articles V, VIII and IX of the Charter including:

Election of directors Re-election/removal of directors

(1)

Sources: SharkRepellent.net, Company Corporate Charter as amended on 1/12/03 and Amended and Restated By-laws.

Aviator Profile (cont.)(1)

Corporate Charter: As seen above, 80% vote required to amend certain provisions of relating to director voting and constituency. By-laws: The by-laws may be amended by at least a majority of the total number of directors then necessary to constitute a full Board. Any by-law may be further amended or reinstated by a majority of shareholders by vote at either an annual or special shareholder meeting (provided the amendment is timely included in order of business). All Officers and Directors of the Company are fully indemnified by the Company unless they are found to have not acted in good faith. Yes, triggered at 15%.

Amendments

Officer and Director Indemnification Shareholder Rights Plan

(1)


Section 210

Valuation of Aviator

(1)


Section 2-111

Aviator Top-Down Valuation

Summary Valuation of AviatorCalendar Year Ending December 31,Aviator Enterprise Value Range as a Multiple of CY 2006E/2005E Valuation Method Enterprise Value Range Revenues EBITDA EBIT Net Income(1) Revenues EBITDA

($ in millions)CY 2006E/2005E EBIT Net Income

Discounted Cash Flow Analysis

$4,500

$5,750

0.83 x 0.89 0.83 x 0.89 1.02 x 1.09 0.83 x 0.89

1.07 x 1.14 1.02 x 1.09 1.20 x 1.29 1.16 x 1.24

6.6 x 7.2 6.6 x 7.2 8.0 x 8.8 6.6 x 7.2

8.4 x 9.2 8.0 x 8.8

10.7 x 13.3 10.7 x 13.3 13.1 x 16.2 10.7 x 13.3

13.7 x 17.0 13.1 x 16.2 15.5 x 19.2 14.9 x 18.4

13.8 x 17.3 13.8 x 17.3 16.5 x 20.6 13.8 x 17.3

17.1 x 21.5 16.5 x 20.6 19.1 x 24.0 18.5 x 23.2

$5,395.8 5,029.5 $5,395.8 5,029.5 $5,395.8 5,029.5 $5,395.8 5,029.5

$686.9 626.4 $686.9 626.4 $686.9 626.4 $686.9 626.4

$419.0 338.9 $419.0 338.9 $419.0 338.9 $419.0 338.9

$374.8 298.7 $374.8 298.7 $374.8 298.7 $374.8 298.7

Comparable Company Analysis

$4,500

$5,500

Comparable Acquisition Analysis

$5,500

$6,500

9.5 x 10.4 9.1 x

BSC REFERENCE RANGE

$4,500

$6,250

10.0

Add: Cash Option Proceeds Less: Total Debt Minority Interest Total Adjustments Gross Equity Value Gross Diluted Shares (M) Equity Value Per Share Stock Price (05/27/05) Premium/(Discount)

$688.3 80.4

$688.3 212.0

Assumes 20.696 million in-the-money options at a weighted average strike price of $3.89 and 31.130 million in-the-money options at a weighted average strike price of $6.81.

$22.0 0.0 $746.7 $5,246.7 497.739 $10.54 $9.53 10.6 %

$22.0 0.0 $878.3 $7,128.3 508.173 $14.03 $9.53 47.2 %

Valuation Matrix($ in millions, except per share data)Market $9.53 $10.00 $11.00 Potential Price per Share $12.00 $13.00 $14.00

Premium Over: Stock Price (05/27/05) 52-Week High 52-Week Low AverageLast 30 days x Shares Outstanding plus Exercisable Options - Option Proceeds Equity Value + Debt + Minority Interest - Cash Enterprise Value Equity Value as a Multiple of: CY 2007E Net Income CY 2006E Net Income CY 2005E Net Income Enterprise Value as a Multiple of: CY 2007E Revenue CY 2006E Revenue CY 2005E Revenue CY 2007E EBITDA CY 2006E EBITDA CY 2005E EBITDA

$9.53 17.76 7.76 9.00

0.0 % (46.3 ) 22.8 5.9 497.739 $80.4 $4,663.0 $22.0 688.3 $3,996.7

4.9% (43.7) 28.9 11.2 497.739 $80.4 $4,896.9 $22.0 688.3 $4,230.6 12.4x 13.3 16.5 0.74x 0.78 0.84 5.4x 6.2 6.8

15.4% (38.1) 41.8 22.3 497.739 $80.4 $5,394.7 $22.0 688.3 $4,728.4 13.6x 14.7 18.2 0.83x 0.88 0.94 6.0x 6.9 7.5 9.2x

25.9% (32.4) 54.6 33.4 497.739 $80.4 $5,892.4 $22.0 688.3 $5,226.1 14.9x 16.0 19.9 0.91x 0.97 1.04 6.6x 7.6 8.3 10.2x

36.4% (26.8) 67.5 44.5 508.173 $212.0 $6,394.2 $22.0 688.3 $5,727.9 16.1x 17.4 21.5 1.00x 1.06 1.14 7.3x 8.3 9.1 11.1x

46.9% (21.2) 80.4 55.6 508.173 $212.0 $6,902.4 $22.0 688.3 $6,236.1 17.4x 18.8 23.3 1.09x 1.16 1.24 7.9x 9.1 10.0 12.1x

$396.2 367.3 296.8 $5,719.5 5,395.8 5,029.5 $788.9 686.9 626.4

11.8 x 12.7 15.7 0.70 x 0.74 0.79 5.1 x 5.8 6.4

Note: Financial projections based on Wall Street equity research and Bear Stearns Investment Banking estimates. CY 2007E EBIT $513.8 7.8 8.2x (1) Multiple of Equity Value.

CY 2006E EBIT CY 2005E EBIT

419.0 338.9

x 9.5 11.8

10.1 12.5

11.3 14.0

12.5 15.4

13.7 16.9

14.9 18.4

Discounted Cash Flow Analysis($ in millions, except per share data)WACC PV of Period Cash Flows PV of Terminal Value PV of Enterprise Implied FCF Growth Rate PV per Share(1) 15.00% TV-Forward Revenue Multiple 0.85x 1.00x 1.15x $1,345.3 3,075.8 $4,421.11 6.8 % $10.32 $1,345.3 3,618.6 $4,963.89 7.9 % $11.41 $1,345.3 4,161.3 $5,506.68 8.8 % $12.49 TV-Forward EBITDA Multiple 6.5x 7.5x 8.5x $1,345.3 3,539.5 $4,884.87 7.8 % $11.25 $1,345.3 4,084.1 $5,429.41 8.7 % $12.34 $1,345.3 4,628.6 $5,973.95 9.4 % $13.42 TV-Forward EBIT Multiple 9.0x 10.0x 11.0x $1,345.3 3,419.5 $4,764.87 7.6 % $11.01 $1,345.3 3,799.5 $5,144.82 8.3 % $11.77 $1,345.3 4,179.4 $5,524.77 8.8 % $12.53 TV-Forward Unlevered NI Multiple 14.0x 15.0x 16.0x $1,345.3 3,510.7 $4,856.06 7.7 % $11.19 $1,345.3 3,761.5 $5,106.82 8.2 % $11.69 $1,345.3 4,012.3 $5,357.59 8.6 % $12.19

PV of Period Cash Flows PV of Terminal Value PV of Enterprise Implied FCF Growth Rate PV per Share(1)

16.00%

$1,315.7 2,960.3 $4,276.0 7.7 % $10.03

$1,315.7 3,482.7 $4,798.4 8.9 % $11.08

$1,315.7 4,005.1 $5,320.8 9.8 % $12.12

$1,315.7 3,406.6 $4,722.3 8.7 % $10.92

$1,315.7 3,930.7 $5,246.4 9.6 % $11.97

$1,315.7 4,454.8 $5,770.5 10.4 % $13.02

$1,315.7 3,291.2 $4,606.8 8.5 % $10.69

$1,315.7 3,656.8 $4,972.5 9.2 % $11.42

$1,315.7 4,022.5 $5,338.2 9.8 % $12.15

$1,315.7 3,378.9 $4,694.6 8.7 % $10.87

$1,315.7 3,620.3 $4,935.9 9.1 % $11.35

$1,315.7 3,861.6 $5,177.3 9.5 % $11.83


17.00%

$1,287.0 2,850.1 $4,137.1 8.6 % $9.76

$1,287.0 3,353.0 $4,640.1 9.8 % $10.76

$1,287.0 3,856.0 $5,143.1 10.7 % $11.76

$1,287.0 3,279.8 $4,566.9 9.7 % $10.61

$1,287.0 3,784.4 $5,071.5 10.6 % $11.62

$1,287.0 4,289.0 $5,576.0 11.3 % $12.63

$1,287.0 3,168.6 $4,455.7 9.4 % $10.39

$1,287.0 3,520.7 $4,807.7 10.1 % $11.09

$1,287.0 3,872.8 $5,159.8 10.7 % $11.80

$1,287.0 3,253.1 $4,540.2 9.6 % $10.56

$1,287.0 3,485.5 $4,772.5 10.1 % $11.02

$1,287.0 3,717.9 $5,004.9 10.5 % $11.49


18.00%

$1,259.5 2,744.9 $4,004.3 9.6 % $9.49

$1,259.5 3,229.3 $4,488.7 10.8 % $10.46

$1,259.5 3,713.6 $4,973.1 11.7 % $11.42

$1,259.5 3,158.7 $4,418.2 10.6 % $10.32

$1,259.5 3,644.7 $4,904.1 11.5 % $11.29

$1,259.5 4,130.6 $5,390.1 12.3 % $12.26

$1,259.5 3,051.6 $4,311.1 10.4 % $10.10

$1,259.5 3,390.7 $4,650.2 11.1 % $10.78

$1,259.5 3,729.8 $4,989.2 11.7 % $11.46

$1,259.5 3,133.0 $4,392.5 10.6 % $10.27

$1,259.5 3,356.8 $4,616.3 11.0 % $10.71

$1,259.5 3,580.6 $4,840.1 11.4 % $11.16

Note: Financial projections based on Wall Street equity research and Bear Stearns Investment Banking estimates.

Free Cash Flow AnalysisWholeCo($ in millions) 2005Revenue EBITDA Depreciation & Amortization EBIT EBIT Margin Taxes Tax Rate Unlevered Net Income Depreciation & Amortization (Increase)/Decrease in Working Capital Capital Expenditures & Additions to Intangible Assets Other Cash Flows $4,934.0 $615.4 (294.7 ) $320.7 6.5 % ($38.7 ) 12.1 % $282.0 $294.7 (49.1 ) (155.2 ) 3.4

2006$5,316.0 $659.5 (266.1 ) $393.4 7.4 % ($42.8 ) 10.9 % $350.6 $266.1 (65.2 ) (172.7 ) 9.6

Projected FYE September 30, 2007 2008$5,635.0 $769.2 (273.3 ) $495.9 8.8 % ($109.1 ) 22.0 % $386.8 $273.3 (26.0 ) (171.6 ) (11.4 ) $451.1 $5,973.1 $847.9 (280.5 ) $567.4 9.5 % ($192.9 ) 34.0 % $374.5 $280.5 (25.5 ) (173.5 ) (9.0 ) $447.1

2009$6,331.6 $952.8 (288.0 ) $664.8 10.5 % ($226.0 ) 34.0 % $438.8 $288.0 (23.8 ) (175.4 ) (9.8 ) $517.7

2010$6,711.5 $1,010.0 (305.3 ) $704.7 10.5 % ($239.6 ) 34.0 % $465.1

Unlevered Free Cash Flowon Wall Street equity research and Bear Stearns Investment Banking estimates. $375.8 $388.4 Note: Financial projections basedNote: Discounted back to May 01, 2005. (1) Assumes $855.0 million cash, $80.4 million option proceeds, $188.0 million debt and 500.710 gross diluted shares.

% Growth

NA

3 %

16 %

(1 %)

16 %

Comparable Company Trading AnalysisAviator($ in millions, except per share amounts)Company Aviator Enterprise Communications Alcatel Aspect Cisco Inter-Tel InterVoice Nortel Polycom Mean Median Enterprise / Telecom Services Black Box Convergys CGI Group Getronics Unisys Mean Median AviatorImplied Enterprise Value Enterprise Communications Alcatel Aspect Cisco Inter-Tel InterVoice Nortel Polycom Enterprise/Telecom Services Black Box Convergys CGI Group Getronics Unisys 34.21 13.04 5.61 1.62 6.88 607.6 1,862.9 2,506.0 1,372.2 2,320.6 637.4 2,163.4 2,684.5 1,335.0 2,711.2 Stock Price 05/09/05 $9.08 Equity Value $4,185.6 Enterprise Value $ 3,518.6 Enterprise Value/CY 2005E Revenue EBITDA EBIT 0.70 x 0.88 x 1.12 3.93 0.83 2.35 1.14 2.33 1.80 x 1.14 1.14 x 0.81 0.82 0.39 0.46 0.72 x 0.81 5.6 x 6.8x 4.9 11.1 5.8 11.7 12.6 10.1 9.0 x 10.1 8.3 x 5.6 5.4 6.1 5.6 6.2 x 5.6 10.4x Enterprise Value/CY 2006E Revenue EBITDA EBIT 0.65 x 0.85 x 1.06 3.53 0.77 2.11 1.08 2.10 1.64 x 1.08 0.95 x 0.76 0.75 0.36 0.44 0.65 x 0.75 5.1 x 6.4 x 4.3 9.9 5.1 9.2 9.1 8.5 7.5 x 8.5 6.7 x 5.1 4.8 5.1 4.3 5.2 x 5.1 8.4 x 9.0 x 5.4 11.2 5.8 11.4 12.5 11.5 9.6 x 11.2 8.0 x 8.2 6.8 6.7 10.0 7.9 x 8.0 P/E CY 2005E 15.7 x 14.5 x 15.8 19.3 13.8 18.4 29.7 20.3 18.8 x 18.4 14.8 x 13.7 12.5 11.5 NM 13.1 x 13.1 CY 2006E 12.7 x 12.0 x 13.5 17.0 12.0 16.9 18.6 17.2 15.3 x 16.9 12.5 x 12.1 10.8 9.0 19.7 12.8 x 12.1

10.95 9.02 18.21 19.23 11.00 2.62 15.66

15,286.5 575.3 117,893.7 588.3 434.9 9,330.1 1,562.4

14,812.2 415.5 101,368.7 373.4 394.7 10,079.1 1,347.5

9.6x 6.6 12.6 6.4 15.1 19.9 13.9 12.0x 12.6 9.6x 9.1 8.1 9.7 27.3 12.8x 9.6

$10.35 12.69 40.95 9.78 25.07 12.94 24.90 12.98 9.62 9.73 5.38 6.14

$10.02 7.59 15.35 8.80 16.10 17.31 14.18 11.90 8.51 8.30 9.15 8.55

$7.99 5.94 10.03 5.85 11.75 14.96 10.93 7.98 7.64 6.95 8.09 20.02

$10.63 12.87 39.51 9.78 24.28 13.12 24.17 11.74 9.68 9.58 5.42 6.28

$10.35 7.35 15.19 8.49 14.20 14.06 13.16 10.66 8.55 8.11 8.56 7.36

$9.06 6.01 10.89 6.40 11.05 12.01 11.14 8.17 8.38 7.21 7.13 9.88

$10.08 10.86 12.91 9.68 12.38 19.09 13.53 10.26 9.62 8.89 8.27 NA

$10.33 11.37 13.98 10.32 13.89 15.12 14.12 10.65 10.36 9.40 8.10 15.92


Comparable Transaction Multiples and Implied ValuationAviator($ in millions)Target Acquiror Enterprise Communications ScanSoft Avaya Polycom Alcatel Nortel InterVoice Enterprise/Telecom Services Nortel IBM Warburg-Providence Cisco Avaya CGI GTCR Target Nuance Tenovis PictureTel Genesys Periphonics Brite Voice PEC Solutions Corio Telcordia NetSolve Expanets AMS Syniverse Transaction Date 05/09/2005 11/18/2004 05/22/2001 09/28/1999 08/23/1999 04/26/1999 04/26/2005 01/25/2005 11/18/2004 09/09/2004 11/26/2003 03/09/2004 02/14/2002 Equity Value $212.5 370.5 357.7 1,526.8 419.6 172.0 471.1 182.0 1,350.0 128.0 152.0 858.0 770.0 Enterprise Value $113.8 635.5 358.4 1,465.3 392.0 159.5 448.0 174.1 1,350.0 89.0 152.0 795.7 770.0 Revenue 1.49 x 1.00 0.92 7.25 2.27 0.97 1.65 x 2.94 1.53 2.21 0.36 0.78 2.45 Enterprise Value/Forward EBITDA NA 6.5 x 6.7 26.1 14.7 10.5 11.9 x NA 7.7 NA NA 8.9 6.3 EBIT 49.5 x NA 15.7 33.8 19.9 16.8 13.2 x NM 8.9 NM NM 17.3 7.4 Forward P/E 42.1 x NA 20.7 53.0 31.1 27.4 22.5 x NM NA NM NA 31.3 NA

AviatorImplied Valuation Acquiror Target Enterprise Communications ScanSoft Nuance Avaya Tenovis Polycom PictureTel Alcatel Genesys Nortel Periphonics InterVoice Brite Voice Enterprise/Telecom Services Nortel PEC Solutions IBM Corio Warburg-Providence Telcordia Cisco NetSolve Avaya Expanets CGI AMS GTCR Syniverse

$16.21 11.35 10.56 72.93 23.86 11.05 $17.77 30.46 16.57 23.27 5.02 9.21 25.64

NA 9.48 9.73 33.57 19.56 14.40 $16.12 NA 10.96 NA NA 12.37 9.24

NM NA 11.55 23.14 14.24 12.25 $9.95 NA 7.19 NA NA 12.57 6.23

NM NA 11.58 29.39 17.31 15.27 $12.57 NA NA NA NA 17.42 NA

Note: Based on Aviators Forward Revenue of $4934.0 million, Forward EBITDA of $615.4 million, Forward EBIT of $320.7 million, and Forward Net Income of $276.2 million. Note: Based on Aviators Cash of $855.0 million, Debt of $188.0 million, and Option Proceeds of $80.4 million.

Weighted Average Cost of Capital AnalysisAviatorAssumptionsRisk-free Rate(1)

Unlevered Beta Calculation4.39 % 7.20 12.0 Comparable Company Enterprise Communications Alcatel Aspect Cisco Inter-Tel InterVoice Nortel Polycom Mean Enterprise/Telecom Services Black Box Convergys Corporation CGI Group Getronics Unisys Mean Consolidated Mean Aviator Barra Beta 1.62 1.64 1.45 1.32 1.41 2.21 1.61 1.61 1.24 1.14 1.00 1.99 1.75 1.43 1.53 2.44 Debt/Equity(3) 39.1% 0.1 0.0 0.0 2.4 40.1 0.0 11.7% 6.7% 18.1 14.7 15.1 45.3 20.0% 15.1% 4.5 Unlevered Beta(4) 1.20 1.64 1.45 1.32 1.38 1.63 1.61 1.46 1.17 0.98 0.89 1.76 1.25 1.21 1.36 2.35

Market Risk Premium(2) Aviator Marginal Tax Rate

WACC CalculationBased on Aviators Unlevered BetaDebt/ Equity(4) 10.0 % 20.0 30.0 40.0 50.0 Debt/ Capitalization 9.1% 16.7 23.1 28.6 33.3 Levered Beta(5) 2.56 2.76 2.97 3.18 3.38 Cost of Equity(6) 22.8% 24.3 25.8 27.3 28.7 6.00% 21.2% 21.1 21.0 21.0 20.9 7.00% 21.3% 21.3 21.2 21.2 21.2 Pre-Tax Cost of Debt 8.00% 21.4% 21.4 21.4 21.5 21.5 9.00% 21.4% 21.6 21.7 21.7 21.8 10.00% 21.5% 21.7 21.9 22.0 22.1

WACC CalculationBased on Industry Average Unlevered BetaDebt/ Equity(4) 10.0 % 20.0 30.0 40.0 50.0 Debt/ Capitalization 9.1% 16.7 23.1 28.6 33.3 Levered Beta(6) 1.53 1.66 1.78 1.90 2.03 Cost of Equity(7) 15.4% 16.3 17.2 18.1 19.0 6.00% 14.5% 14.5 14.5 14.4 14.4 7.00% 14.6% 14.6 14.7 14.7 14.7 Pre-Tax Cost of Debt 8.00% 14.7% 14.8 14.9 14.9 15.0 9.00% 14.7% 14.9 15.1 15.2 15.3 10.00% 14.8% 15.1 15.3 15.4 15.6

Note: Based on Aviators Forward Revenue of $4934.0 million, Forward EBITDA of $615.4 million, Forward EBIT of $320.7 million, and Forward Net Income of $276.2 million. Note: Based on Aviators Cash of $855.0 million, Debt of $188.0 million, and Option Proceeds of $80.4 million.

Section 2-212

Aviator Sum-of-the-Parts ValuationNote: Barra Beta as of May 9, 2005. WACC = Kd * D/(D+E) + Ke * E/(D+E) . (1) Yield on 20-year Treasury Bond as of March 9, 2005. (2) Long-term horizon expected equity risk premium. Source: Ibbotson Associates. (3) Total debt divided by market value of equity. (4) Unlevered Beta = Predicted Beta / (1+ (1-tax)*D/E). (5) Levered Beta = Unlevered Beta * (1+(1-tax)*D/E)). (6) Cost of Equity = Risk-free Rate + (Levered Beta * Market Risk Premium) + Market Capitalization Premium.

Sum-of-the-Parts Valuation($ in millions)Value Range as a Multiple of CY 2006E/2005E Valuation Method Enterprise Value Range Revenues EBITDA EBIT Unlevered Net Income Revenues CY 2006E/2005E EBITDA EBIT Unlevered Net Income

Global Communications Group

$2,000

$2,500

0.80 x 0.86

1.01 x

7.8 x 9.1 5.8 6.1 6.5 x 7.18

9.8 x

12.7 x 16.7 9.5

15.9 x 20.9 14.2 17.1 14.9 x 18.4

14.5 x 19.0 10.8

18.1 $2,486.8 x 23.8 16.2 19.4 16.9 $5,395.8 x 20.9 5,029.5 $689.3 627.1 $420.2 339.3 $369.8 298.6 2,319.0 2,908.9 2,710.5 $256.3 220.4 433.0 406.7 $156.9 119.5 263.4 219.8 $138.0 105.1 231.8 193.4

1.08 1.29

11.3 8.7 9.2 9.1 x

Global Services

$2,500

$3,750

0.86 0.92

1.38 1.16 x

11.4 10.7 x

12.9 12.2 x

BSC REFERENCE RANGE

$4,500

$6,250

0.83 x 0.89 x

1.24

9.97

13.3

15.1

Section 2-313

Enterprise Communications Group Valuation

Summary ValuationGlobal Communications Group($ in millions)Global Communications Solutions Value Range as a Multiple of CY 2006E/2005E Valuation Method Discounted Cash Flow Analysis Enterprise Value Range $2,000 $2,600 Revenues 0.80 x 0.86 0.80 x 0.86 0.88 x 0.95 0.80 x 0.86 1.05 x 1.12 1.01 x 1.08 1.05 x 1.12 1.01 x 1.08 7.8 x 9.1 7.8 9.1 8.6 10.1 7.8 9.1 EBITDA 10.1 x 11.8 9.8 11.3 10.1 11.8 9.8 11.3 12.7 x 16.7 12.7 16.7 14.0 18.4 12.7 16.7 EBIT 16.6 x 21.8 15.9 20.9 16.6 21.8 15.9 20.9 Unlevered Net Income 14.5 x 19.0 14.5 19.0 15.9 20.9 14.5 19.0 18.8 x 24.7 18.1 23.8 18.8 24.7 18.1 23.8 Revenues $2,486.8 2,319.0 $2,486.8 2,319.0 $2,486.8 2,319.0 $2,486.8 2,319.0 CY 2006E/2005E EBITDA $256.3 220.4 $256.3 220.4 $256.3 220.4 $256.3 220.4 EBIT $156.9 119.5 $156.9 119.5 $156.9 119.5 $156.9 119.5 Unlevered Net Income $138.0 105.1 $138.0 105.1 $138.0 105.1 $138.0 105.1


$2,000

$2,500


$2,200

$2,600

BSC REFERENCE RANGE

$2,000

$2,500

Valuation Matrix at Selected Enterprise ValuesGlobal Communications Segment($ in millions)$2,000.0 $2,100.0 Enterprise Value $2,200.0 $2,300.0 $2,400.0 $2,500.0

Enterprise Value as a Multiple of: CY 2007E Unlevered Net Income CY 2006E Unlevered Net Income CY 2005E Unlevered Net Income CY 2007E Revenue CY 2006E Revenue CY 2005E Revenue CY 2007E EBITDA CY 2006E EBITDA CY 2005E EBITDA CY 2007E EBIT CY 2006E EBIT CY 2005E EBIT $172.6 138.0 105.1 $2,636.0 2,486.8 2,319.0 $298.3 256.3 220.4 $196.2 156.9 119.5 11.6 x 14.5 19.0 0.76 x 0.80 0.86 6.7 x 7.8 9.1 10.2 x 12.7 16.7 12.2 x 15.2 20.0 0.80 x 0.84 0.91 7.0 x 8.2 9.5 10.7 x 13.4 17.6 12.7 x 15.9 20.9 0.83 x 0.88 0.95 7.4 x 8.6 10.0 11.2 x 14.0 18.4 13.3 x 16.7 21.9 0.87 x 0.92 0.99 7.7 x 9.0 10.4 11.7 x 14.7 19.2 13.9 x 17.4 22.8 0.91 x 0.97 1.03 8.0 x 9.4 10.9 12.2 x 15.3 20.1 14.5 x 18.1 23.8 0.95 x 1.01 1.08 8.4 x 9.8 11.3 12.7 x 15.9 20.9 x

Note: Financial projections based on Wall Street equity research and Bear Stearns Investment Banking estimates. Note: EBITDA, EBIT, and Unlevered Net Income are all adjusted for allocation of corporate overhead.

Discounted Cash Flow AnalysisGlobal Communications Group($ in millions, except per share data)WACC PV of Period Cash Flows PV of Terminal Value PV of Enterprise Implied FCF Growth Rate PV of Period Cash Flows PV of Terminal Value PV of Enterprise Implied FCF Growth Rate PV of Period Cash Flows PV of Terminal Value PV of Enterprise Implied FCF Growth Rate PV of Period Cash Flows PV of Terminal Value PV of Enterprise Implied FCF Growth Rate 16.00% 15.50% 15.00% 14.50% Forward Revenue Multiple 1.00x 1.10x 1.20x $508.7 1,700.2 $2,208.8 8.9% $502.9 1,667.7 $2,170.7 9.4% $497.3 1,636.1 $2,133.3 9.9% $491.7 1,605.1 $2,096.8 10.4% $508.7 1,870.2 $2,378.9 9.4% $502.9 1,834.5 $2,337.4 9.9% $497.3 1,799.7 $2,296.9 10.4% $491.7 1,765.6 $2,257.3 10.9% $508.7 2,040.2 $2,548.9 9.8% $502.9 2,001.3 $2,504.2 10.3% $497.3 1,963.3 $2,460.5 10.8% $491.7 1,926.1 $2,417.9 11.3% Forward EBITDA Multiple 8.0x 9.0x 10.0x $508.7 1,786.1 $2,294.7 9.2% $502.9 1,752.0 $2,254.9 9.7% $497.3 1,718.7 $2,216.0 10.1% $491.7 1,686.2 $2,177.9 10.6% $508.7 2,009.3 $2,518.0 9.8% $502.9 1,971.0 $2,473.9 10.2% $497.3 1,933.6 $2,430.8 10.7% $491.7 1,897.0 $2,388.7 11.2% $508.7 2,232.6 $2,741.3 10.2% $502.9 2,190.0 $2,692.9 10.7% $497.3 2,148.4 $2,645.7 11.2% $491.7 2,107.8 $2,599.5 11.7% Forward EBIT Multiple 9.5x 10.5x 11.5x $508.7 1,529.3 $2,038.0 8.3% $502.9 1,500.1 $2,003.0 8.8% $497.3 1,471.6 $1,968.9 9.3% $491.7 1,443.8 $1,935.5 9.8% $508.7 1,690.3 $2,198.9 8.9% $502.9 1,658.0 $2,160.9 9.4% $497.3 1,626.5 $2,123.8 9.9% $491.7 1,595.8 $2,087.5 10.3% $508.7 1,851.2 $2,359.9 9.4% $502.9 1,815.9 $2,318.8 9.8% $497.3 1,781.4 $2,278.7 10.3% $491.7 1,747.7 $2,239.5 10.8%


Free Cash Flow AnalysisGlobal Communications Group($ in millions) 2005Revenue EBITDA Depreciation & Amortization EBIT EBIT Margin Taxes Tax Rate Unlevered Net Income Depreciation & Amortization Deferred Taxes (Increase)/Decrease in Working Capital Capital Expenditures Other Cash Flows Unlevered Free Cash Flow $2,275.3 $212.3 (101.7 ) $110.6 4.9 % ($13.3 ) 12.1 % $97.3 $101.7 (16.9 ) (53.5 ) 1.2 $129.6

2006$2,450.1 $244.8 (98.8 ) $146.0 6.0 % ($15.9 ) 10.9 % $130.1 $98.8 (24.2 ) (64.1 ) 3.6 $144.2


2009$359.7 (106.9 ) $252.8 8.7 % ($86.0 ) 34.0 % $166.8 $106.9 (8.8 ) (65.1 ) (3.6 ) $196.2

2010$3,093.2 $406.2 (113.3 ) $292.9 9.5 % ($99.6 ) 34.0 % $193.3

$2,918.1

Note: Discounted back to May 1, 2005.

Comparable Company Multiples and Implied ValuationGlobal Communications Group($ in millions)Company Aviator Enterprise Communications Alcatel Aspect Cisco Inter-Tel InterVoice Nortel Polycom Mean Median Global Communications Implied Enterprise Value Alcatel Aspect Cisco Inter-Tel InterVoice Nortel Polycom Group $2,045.3 2,585.7 9,108.5 1,913.5 5,443.4 2,643.3 5,402.9 $1,501.5 1,072.9 2,438.6 1,286.1 2,570.3 2,784.2 2,233.3 $1,145.4 783.4 1,505.0 768.6 1,809.1 2,375.0 1,664.8 $2,108.1 2,626.5 8,773.4 1,912.3 5,257.9 2,682.5 5,234.1 $1,649.2 1,091.5 2,549.4 1,302.3 2,366.2 2,339.8 2,172.2 $1,414.7 844.6 1,757.1 917.0 1,785.7 1,965.8 1,802.9 $1,525.8 1,663.9 2,027.0 1,454.6 1,934.1 3,125.2 2,138.4 $1,662.8 1,858.5 2,348.5 1,659.1 2,331.9 2,562.3 2,375.6 10.95 9.02 18.21 19.23 11.00 2.62 15.66 15,286.5 575.3 117,893.7 588.3 434.9 9,330.1 1,562.4 14,812.2 415.5 101,368.7 373.4 394.7 10,079.1 1,347.5 0.88 x 1.12 3.93 0.83 2.35 1.14 2.33 1.80 x 1.14 6.8 4.9 11.1 5.8 11.7 12.6 10.1 9.0 10.1 x x 9.6 x 6.6 12.6 6.4 15.1 19.9 13.9 12.0 x 12.6 0.85 1.06 3.53 0.77 2.11 1.08 2.10 1.64x 1.08 x 6.4 x 4.3 9.9 5.1 9.2 9.1 8.5 7.5 x 8.5 9.0 x 5.4 11.2 5.8 11.4 12.5 11.5 9.6 x 11.2 14.5 x 15.8 19.3 13.8 18.4 29.7 20.3 18.8 x 18.4 12.0 x 13.5 17.0 12.0 16.9 18.6 17.2 15.3 x 16.9 Stock Price 05/09/05 $9.08 Equity Value $4,185.6 Enterprise Value $3,518.6 Enterprise Value/CY 2005E Revenue EBITDA EBIT 0.70 x 5.6 x 10.4 x Enterprise Value/CY 2006E Revenue EBITDA EBIT 0.65 x 5.1 x 8.4 x P/E CY 2005E 15.7 x CY 2006E 12.7 x


Comparable M&A Transaction Multiples and Implied ValuationGlobal Communications Group($ in millions)Acquiror ScanSoft Avaya UT Starcom Cisco Melita Polycom Cisco Alcatel Nortel InterVoice Cisco Nortel Lucent Target Nuance Tenovis Commworks (3Com) Latitude Concerto PictureTel Active Voice Genesys Periphonics Brite Voice Geotel Bay Networks Octel Transaction Date 05/09/2005 11/18/2004 04/23/2004 11/12/2003 10/06/2003 05/22/2001 11/10/2000 09/28/1999 08/23/1999 04/26/1999 04/12/1999 06/15/1998 07/17/1997 Target Equity Value $212.5 370.5 100.0 92.5 141.9 357.7 295.3 1,526.8 419.6 172.0 1,914.1 8,520.3 1,755.8 Enterprise Value $113.8 635.5 100.0 69.9 113.8 358.4 275.8 1,465.3 392.0 159.5 1,854.4 7,912.7 1,665.5 Revenue 1.49x 1.00x 0.91x 2.20x 1.07x 0.92x 3.21x 7.25x 2.27x 0.97x 25.73x 2.70x 2.74x Enterprise Value/Forward EBITDA NA 6.5x NA NA 18.0x 6.7x 47.6x 26.1x 14.7x 10.5x 85.7x NA 14.4x EBIT 49.5x NA NA NA 23.0x 15.7x 96.3x 33.8x 19.9x 16.8x 92.3x NA 22.8x Forward P/E 42.1x NA NA NA 38.1x 20.7x 122.1x 53.0x 31.1x 27.4x 132.5x NA 34.7x

Global Communication GroupImplied Valuation Acquiror Target ScanSoft Avaya UT Starcom Cisco Melita Polycom Cisco Alcatel Nortel InterVoice Cisco Nortel Lucent Nuance Tenovis Commworks (3Com) Latitude Concerto PictureTel Active Voice Genesys Periphonics Brite Voice Geotel Bay Networks Octel $3,463.3 2,319.0 2,110.3 5,101.8 2,481.3 2,133.5 7,443.9 NM NM 2,249.4 NM 6,261.2 6,354.0 NA 1,432.8 NA NA 3,967.6 1,476.8 NM NM 3,240.2 2,314.5 NM NA 3,174.1 NM NA NA NA 2,748.1 1,875.9 NM NM 2,377.7 2,007.3 NM NA 2,724.2 NM NA NA NA 4,006.0 2,176.5 NM NM 3,270.0 2,881.0 NM NA 3,648.5

Note: The P/E multiple is applied to Unlevered Net Income. Note: Based on Enterprise Communications segment Forward Revenue of $2319.0 million, Forward EBITDA of $220.4 million, Forward EBIT of $119.5 million, and Forward Net Income of $105.1 million.

Cost of Capital AnalysisEnterprise Communications GroupAssumptionsRisk-free Rate(1) Market Risk Premium(2) Harris Marginal Tax Rate 4.39 % 7.20 12.0

Unlevered Beta CalculationComparable Company Global Communications Group Alcatel Aspect Cisco Inter-Tel InterVoice Nortel Polycom Consolidated Mean Aviator Barra Beta 1.62 1.64 1.45 1.32 1.41 2.21 1.61 1.61 2.44 Debt/ Equity(3) 39.1 0.1 0.0 0.0 2.4 40.1 0.0 11.7 4.5 % Unlevered Beta(4) 1.20 1.64 1.45 1.32 1.38 1.63 1.61 1.46 2.35

% %

WACC CalculationBased on Industry Average Unlevered BetaGlobal Communications GroupDebt/ Equity(4) 10.0 % 20.0 30.0 40.0 50.0 Debt/ Capitalization 9.1 % 16.7 23.1 28.6 33.3 Levered Beta(5) 1.59 1.72 1.85 1.98 2.11 Cost of Equity(6) 15.9 % 16.8 17.7 18.6 19.6 6.00% 14.9 % 14.9 14.8 14.8 14.8 7.00% 15.0 % 15.0 15.0 15.1 15.1 Pre-Tax Cost of Debt 8.00% 15.1 % 15.2 15.3 15.3 15.4 9.00% 15.1 % 15.3 15.5 15.6 15.7 10.00% 15.2 % 15.5 15.7 15.8 16.0

Note: The P/E multiple is applied to Unlevered Net Income. Note: Based on Enterprise Communications segment Forward Revenue of $2319.0 million, Forward EBITDA of $220.4 million, Forward EBIT of $119.5 million, and Forward Net Income of $105.1 million.

Section 2-414

Enterprise Services Valuation

Note: Barra Beta as of May 9, 2005. WACC = Kd * D/(D+E) + Ke * E/(D+E) . (1) Yield on 20-year Treasury Bond as of May 9, 2005. (2) Long-term horizon expected equity risk premium. Source: Ibbotson Associates. (3) Total debt divided by market value of equity. (4) Unlevered Beta = Predicted Beta/(1+ (1-tax)*D/E). (5) Levered Beta = Unlevered Beta * (1+(1-tax)*D/E). (6) Cost of Equity = Risk-free Rate + (Levered Beta * Market Risk Premium) + Market Capitalization Premium.

Summary ValuationGlobal Services($ in millions)Global Services Value Range as a Multiple of CY 2006E/2005E Valuation Method Discounted Cash Flow Analysis Enterprise Value Range $2,500 $3,500 0.80 x 0.86 0.86 x 0.92 0.95 x 1.01 0.86 x 0.92 Revenues 1.05 x 1.12 1.20 x 1.29 1.38 x 1.48 1.29 x 1.38 7.8 x 6.1 5.8 6.1 6.4 6.8 5.8 6.1 EBITDA 8.1 x 8.6 8.1 8.6 9.2 9.8 8.7 9.2 9.5 x 11.4 9.5 11.4 10.4 12.5 9.5 11.4 EBIT 13.3 x 15.9 13.3 15.9 15.2 18.2 14.2 17.1 Unlevered Net Income 10.8 x 12.9 10.8 12.9 11.9 14.2 10.8 12.9 15.1 x 18.1 15.1 18.1 17.3 20.7 16.2 19.4 Revenues $2,908.9 2,710.5 $2,908.9 2,710.5 $2,908.9 2,710.5 $2,908.9 2,710.5 CY 2006E/2005E EBITDA $433.0 406.7 $433.0 406.7 $433.0 406.7 $433.0 406.7 EBIT $263.4 219.8 $263.4 219.8 $263.4 219.8 $263.4 219.8 Unlevered Net Income $231.8 193.4 $231.8 193.4 $231.8 193.4 $231.8 193.4


$2,500

$3,500


$2,750

$4,000

BSC REFERENCE RANGE

$2,500

$3,750

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Valuation Matrix at Selected Enterprise ValuesGlobal Services($ in millions)$2,500.0 $2,750.0 Enterprise Value $3,000.0 $3,250.0 $3,500.0 $3,750.0

Enterprise Value as a Multiple of: CY 2007E Unlevered Net Income CY 2006E Unlevered Net Income CY 2005E Unlevered Net Income CY 2007E Revenue CY 2006E Revenue CY 2005E Revenue CY 2007E EBITDA CY 2006E EBITDA CY 2005E EBITDA CY 2007E EBIT CY 2006E EBIT CY 2005E EBIT $279.5 231.8 193.4 $3,083.5 2,908.9 2,710.5 $491.8 433.0 406.7 $317.6 263.4 219.8 8.9 x 10.8 12.9 0.81 x 0.86 0.92 5.1 x 5.8 6.1 7.9 x 9.5 11.4 9.8 x 11.9 14.2 0.89 x 0.95 1.01 5.6 x 6.4 6.8 8.7 x 10.4 12.5 10.7 x 12.9 15.5 0.97 x 1.03 1.11 6.1 x 6.9 7.4 9.4 x 11.4 13.6 11.6 x 14.0 16.8 1.05 x 1.12 1.20 6.6 x 7.5 8.0 10.2 x 12.3 14.8 12.5 x 15.1 18.1 1.14 x 1.20 1.29 7.1 x 8.1 8.6 11.0 x 13.3 15.9 13.4 x 16.2 19.4 1.22 x 1.29 1.38 7.6 x 8.7 9.2 11.8 x 14.2 17.1


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Discounted Cash Flow AnalysisGlobal Services($ in millions)WACC PV of Period Cash Flows PV of Terminal Value PV of Enterprise Implied FCF Growth Rate PV of Period Cash Flows PV of Terminal Value PV of Enterprise Implied FCF Growth Rate PV of Period Cash Flows PV of Terminal Value PV of Enterprise Implied FCF Growth Rate PV of Period Cash Flows PV of Terminal Value PV of Enterprise Implied FCF Growth Rate 15.00% 14.50% 14.00% 13.50% Forward Revenue Multiple 0.80x 0.95x 1.10x $873.3 1,653.9 $2,527.2 4.3% $863.5 1,622.1 $2,485.6 4.7% $853.8 1,591.0 $2,444.8 5.2% $844.3 1,560.7 $2,405.0 5.6% $873.3 1,964.0 $2,837.4 5.6% $863.5 1,926.2 $2,789.7 6.1% $853.8 1,889.3 $2,743.1 6.5% $844.3 1,853.3 $2,697.6 7.0% $873.3 2,274.1 $3,147.5 6.6% $863.5 2,230.4 $3,093.8 7.1% $853.8 2,187.6 $3,041.4 7.6% $844.3 2,145.9 $2,990.2 8.0% Forward EBITDA Multiple 5.0x 6.0x 7.0x $873.3 1,920.3 $2,793.6 5.4% $863.5 1,883.3 $2,746.8 5.9% $853.8 1,847.3 $2,701.0 6.4% $844.3 1,812.0 $2,656.3 6.8% $873.3 2,304.3 $3,177.7 6.7% $863.5 2,260.0 $3,123.5 7.2% $853.8 2,216.7 $3,070.5 7.6% $844.3 2,174.4 $3,018.7 8.1% $873.3 2,688.4 $3,561.7 7.6% $863.5 2,636.7 $3,500.1 8.1% $853.8 2,586.2 $3,439.9 8.6% $844.3 2,536.8 $3,381.1 9.0% Forward EBIT Multiple 7.5x 8.5x 9.5x $873.3 2,052.3 $2,925.7 5.9% $863.5 2,012.8 $2,876.3 6.4% $853.8 1,974.3 $2,828.1 6.9% $844.3 1,936.6 $2,780.9 7.3% $873.3 2,326.0 $3,199.3 6.8% $863.5 2,281.2 $3,144.7 7.2% $853.8 2,237.5 $3,091.3 7.7% $844.3 2,194.8 $3,039.1 8.2% $873.3 2,599.6 $3,472.9 7.4% $863.5 2,549.6 $3,413.1 7.9% $853.8 2,500.7 $3,354.5 8.4% $844.3 2,453.0 $3,297.3 8.9%


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Free Cash Flow AnalysisGlobal Services($ in millions) 2005Revenue EBITDA Depreciation & Amortization EBIT EBIT Margin Taxes Tax Rate Unlevered Net Income Depreciation & Amortization Deferred Taxes (Increase)/Decrease in Working Capital Capital Expenditures Other Cash Flows Unlevered Free Cash Flow $2,658.7 $403.1 (193.0 ) $210.1 7.9 % ($25.3 ) 12.1 % $184.7 $193.0 (32.2 ) (101.7 ) 2.2 $246.2

2006$2,865.9 $417.5 (168.4 ) $249.0 8.7 % ($27.1 ) 10.9 % $221.9 $168.4 (41.3 ) (109.3 ) 6.1 $245.9


2009$3,413.5 $594.3 (182.3 ) $412.0 12.1 % ($140.1 ) 34.0 % $271.9 $182.3 (15.1 ) (111.0 ) (6.2 ) $321.9

2010$3,618.3 $672.2 (193.2 ) $478.9 13.2 % ($162.8 ) 34.0 % $316.1

Note: Discounted back to May 1, 2005.

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Comparable Company Trading AnalysisGlobal Services($ in millions)Company Aviator Enterprise Services Black Box Convergys CGI Group Getronics Unisys Mean Median Global ServicesImplied Enterprise Value Black Box Convergys CGI Group Getronics Unisys Stock Price 05/09/05 $9.08 Equity Value $4,185.6 Enterprise Value $3,518.6 Enterprise Value/CY 2005E Revenue EBITDA EBIT 0.70 x 1.14 x 0.81 0.82 0.39 0.46 0.72 x 0.81 $3,098.5 2,192.2 2,221.5 1,048.3 1,255.1 5.6 x 8.3 x 5.6 5.4 6.1 5.6 6.2 x 5.6 $3,379.4 2,280.0 2,211.0 2,487.2 2,290.1 10.4 x 9.6 x 9.1 8.1 9.7 27.3 12.8 x 9.6 $2,102.8 1,994.9 1,769.5 2,140.8 6,008.5 Enterprise Value/CY 2006E Revenue EBITDA EBIT 0.65 x 0.95 x 0.76 0.75 0.36 0.44 0.65 x 0.75 $2,767.3 2,209.1 2,183.4 1,058.8 1,292.4 5.1 x 6.7 x 5.1 4.8 5.1 4.3 5.2 x 5.1 $2,884.3 2,218.4 2,081.2 2,224.2 1,845.8 8.4 x 8.0 x 8.2 6.8 6.7 10.0 7.9 x 8.0 $2,095.5 2,161.6 1,793.4 1,770.4 2,630.5 P/E CY 2005E 15.7 x 14.8 x 13.7 12.5 11.5 NM 13.1 x 13.1 $2,864.5 2,655.0 2,417.9 2,215.6 NA CY 2006E 12.7 x 12.5 x 12.1 10.8 9.0 19.7 12.8 x 12.1 $2,891.1 2,798.4 2,496.6 2,086.0 4,556.0

$34.21 13.04 5.61 1.62 6.88

$607.6 1,862.9 2,506.0 1,372.2 2,320.6

$637.4 2,163.4 2,684.5 1,335.0 2,711.2


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AviatorComparable Transaction Multiples and Implied Valuation Global Services($ in millions)

Acquiror Nortel IBM Warburg-Providence Cisco Avaya CGI GTCR

Target PEC Solutions Corio Telcordia NetSolve Expanets AMS Syniverse

Transaction Date 4/26/2005 1/25/2005 11/18/2004 9/9/2004 11/26/2003 3/9/2004 2/14/2002

Equity Value $471.1 182.0 1,350.0 128.0 152.0 858.0 770.0

Target Enterprise Value $448.0 174.1 1,350.0 89.0 152.0 795.7 770.0

Revenue 1.65 x 2.94 1.53 2.21 0.36 0.78 2.45

Enterprise Value/Forward EBITDA 11.9 x NA 7.7 NA NA 8.9 6.3

EBIT 13.2 x NM 8.9 NM NM 17.3 7.4

Forward P/E 22.5 x NM NA NM NA 31.3 NA

ServicesImplied Valuation Acquiror Nortel IBM Warburg-Providence Cisco Avaya CGI GTCR Corio Telcordia NetSolve Expanets AMS Syniverse Target PEC Solutions $3,830.6 6,817.8 3,548.0 5,124.9 829.4 1,815.9 5,681.5 $2,623.1 NA 1,697.3 NA NA 1,950.9 1,388.7 $1,577.2 NA 1,063.4 NA NA 2,067.0 884.2 $2,365.8 NA NA NA NA 3,291.0 NA

Note: The P/E multiple is applied to Unlevered Net Income. Note: Based on Global Services segment Forward Revenue of $2319.0 million, Forward EBITDA of $220.4 million, Forward EBIT of $119.5 million, and Forward Net Income of $105.1 million.

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Cost of Capital AnalysisServicesAssumptionsRisk-free Rate(1) Market Risk Premium(2) Aviator Marginal Tax Rate 4.39 % 7.20 12.0

Unlevered Beta CalculationComparable Company Global Services Black Box Convergys Corporation CGI Group Getronics Unisys Consolidated Mean Aviator Barra Beta 1.24 1.14 1.00 1.99 1.75 1.43 2.44 Debt/ Equity(3) 6.7% 18.1 14.7 15.1 45.3 20.0 4.5 Unlevered Beta(4) 1.17 0.98 0.89 1.76 1.25 1.21 2.35

WACC CalculationBased on Industry Average Unlevered BetaServicesDebt/ Equity(4) 10.0 % 20.0 30.0 40.0 50.0 Debt/ Capitalization 9.1 % 16.7 23.1 28.6 33.3 Levered Beta(5) 1.32 1.42 1.53 1.64 1.74 Cost of Equity(6) 13.9% 14.6 15.4 16.2 16.9 6.00% 13.1% 13.1 13.1 13.1 13.1 7.00% 13.2% 13.2 13.3 13.3 13.4 Pre-Tax Cost of Debt 8.00% 13.3% 13.4 13.5 13.6 13.6 9.00% 13.3% 13.5 13.7 13.8 13.9 10.00% 13.4% 13.7 13.9 14.1 14.2

Note: The P/E multiple is applied to Unlevered Net Income. Note: Based on Enterprise Communications segment Forward Revenue of $2319.0 million, Forward EBITDA of $220.4 million, Forward EBIT of $119.5 million, and Forward Net Income of $105.1 million. (1) Excludes Cisco/Active Voice, Alcatel/Genesys and Cisco/Geotel.

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Section 315

Pro Forma Merger Consequences Nortel Acquires AviatorNote: Barra Beta as of May 9, 2005. WACC = Kd * D/(D+E) + Ke * E/(D+E). (1) Yield on 20-year Treasury Bond as of May 2, 2005. (2) Long-term horizon expected equity risk premium. Source: Ibbotson Associates. (3) Total debt divided by market value of equity. (4) Unlevered Beta = Predicted Beta/(1+ (1-tax)*D/E). (5) Levered Beta = Unlevered Beta * (1+(1-tax)*D/E)). (6) Cost of Equity = Risk-free Rate + (Levered Beta * Market Risk Premium) + Market Capitalization Premium.

Section 3-116

Transaction Considerations

Nortel Merges with AviatorStrategic Rationale

Potential to create the largest PBX vendor globally, with combined enterprise revenue of $8.1 billion and well-entrenched customer relationships Nortel/Aviator will be the #1 vendor in the North American enterprise voice market, with a combined market share of approximately 47% Nortel/Aviator will be the #1 vendor in the global contact center market, with market shares of 56%, 54% and 75% in North America, Europe and Asia respectively Could potentially have the scale and the R&D capabilities to take on Cisco in the enterprise PBX portion of the overall enterprise market as it transforms from circuit to IP Aviators channel mix is mostly direct (65%), whereas Nortels enterprise channel strategy is almost entirely indirect Nortels enterprise business generates approximately 30% of revenue from sale of data networking equipment; Aviator currently generates no revenue from sale of data networking equipment Aviator could potentially cross-sell its service offerings into Nortels customer base; Nortel could potentially cross-sell its data offerings into Aviators customer base Significant opportunities for cost synergies exist through reductions in cost of sales, overlapping R&D platforms and redundant G&A functions Geographic proximity of Nortel and Aviator should allow for efficient execution of these synergies.

Dominant Legacy PBX Vendor Globally

Different Channel and Portfolio Strategies Create Opportunities for Cross Selling

Similar Geographic Footprint Creates Potential for Cost Synergies

Pro Forma Revenue Mix AnalysisNortel Nortel + Aviator

Enterprise 24%

Wireline Infrastructure 25% Enterprise 50%

Wireline Infrastructure 16%

Wireless Infrastructure 51%

Wireless Infrastructure 34%

Total 2005E Revenues = $10.6 Billion

Total 2005E Revenues = $15.6 Billion

Review of Portfolio OverlapNortel Merges with AviatorNortel+ Aviator

Nortel

Lucent

Siemens

Alcatel

Cisco

Aviator

Juniper

Growth Businesses Carrier IP Routing Carrier VoIP Gateways and Softswitches Enterprise Convergence 3G Wireless Broadband Access Security, Storage, WLAN Home Networking/Mobile Phones Mature Businesses Optical Networking ATM Switching 2.02.5G Wireless Enterprise Data Networking Declining Businesses Digital Cross Connect Circuit Switching Legacy PBX

Leadership/Strong Position

Weak Position

Source: Wall Street Research and Bear Stearns Investment Banking estimates. Note: Fiscal year ending December 31.

Review of Key ConsiderationsMerger with AviatorInsert Portrait Tabloid 6937031 (Doc. # 6966602) Page 48

Shareholder Overlap AnalysisNortel ShareholdersPrimecap Management Capital Research & Management MFS Investment Management Smith Barney Asset Management Alliance Capital Management McLean Budden TD Asset Management CDP Capital World Markets Barclays Global Investors BC Investment Management Fidelity Management & Research Canadian Pension Plan Investment Board BMO Nesbitt Burns Artisan Partners RBC Asset Management Ontario Teachers Pension Plan Board Equinox Capital Management Ontario Municipal Employee Retirement System TAL Global Asset Management Phillips, Hager & North Investment Management Connor, Clark & Lunn Investment Management I. G. Investment Management HOOPP Investment Management Deutsche Bank Investment Management Merrill Lynch Investment Managers Letko, Brosseau & Associates Jennison Associates UBS Global Asset Management Goldman Sachs Asset Management Marathon Asset Management TIAA-CREF Investment Management T. Rowe Price Associates AIM Trimark Investments Morgan Stanley Natcan Investment Management C. I. Mutual Funds Deutsche Bank Securities Courage Capital Management Norges Bank Kapitalforvaltning Goldman Sachs Position 118.712 98.550 79.074 78.334 67.884 65.775 62.288 53.573 52.422 51.264 48.026 42.805 37.682 36.825 36.346 33.866 31.418 29.419 24.508 23.038 21.856 18.811 16.524 15.758 15.302 15.174 14.037 13.760 13.554 12.867 12.146 11.685 11.517 11.495 11.425 11.193 9.921 9.736 8.994 8.972 % Ownership 2.8 % 2.3 1.9 1.8 1.6 1.5 1.5 1.3 1.2 1.2 1.1 1.0 0.9 0.9 0.9 0.8 0.7 0.7 0.6 0.5 0.5 0.4 0.4 0.4 0.4 0.4 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.2 0.2 0.2 0.2

Aviator ShareholdersWarburg Pincus Dodge & Cox Fidelity Management & Research Lord, Abbett & Co. Barclays Global Investors Friess Associates SSgA Funds Management Vanguard Group Wellington Management AIM Management Group Calamos Advisors Artisan Partners Franklin Advisers Trusco Capital Management Victory Capital Management Northern Trust Global Investments Bessemer Investment Management Pioneer Global Asset Management TIAA-CREF Investment Management BNP Paribas Asset Management Fifth Third Asset Management Dreyfus Investment Advisors AXA Rosenberg Investment Management Mellon Bank Asset Management JPMorgan Investment Management Northern Capital Management Perkins, Wolf, McDonnell & Co. US Bancorp Asset Management Merrill Lynch Investment Managers, Inc. American Century Global Investment Management California Public Employees Retirement System Deutsche Bank Investment Management Northwestern Investment Management PDR Services Akanthos Capital Management Citadel Investment Group Fred Alger Management Teacher Retirement System of Texas HSBC Asset Management Geode Capital Management Position 47.955 24.812 16.979 16.215 15.083 12.913 11.961 11.883 11.104 10.080 7.283 7.013 6.717 5.952 5.751 4.736 4.645 4.537 3.838 3.617 3.207 2.944 2.720 2.695 2.339 2.153 2.132 2.100 2.056 2.050 1.998 1.971 1.931 1.874 1.872 1.752 1.744 1.699 1.696 1.668 % Ownership 10.0 % 5.2 3.5 3.4 3.1 2.7 2.6 2.5 2.3 2.1 1.5 1.5 1.4 1.2 1.2 1.0 1.0 0.9 0.8 0.8 0.7 0.6 0.6 0.6 0.5 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.3

Section 3-217

Pro Forma Merger Consequences

Relative Contribution Analysis($ in millions)Nortel $ Aviator % Total Nortel Aviator

Revenues

FY 2008E FY 2007E FY 2006E FY 2008E FY 2007E FY 2006E FY 2008E FY 2007E FY 2006E FY 2008E FY 2007E FY 2006E

$13,305.9 12,672.3 12,061.7 $1,481.0 1,429.4 1,130.1 $1,075.3 1,023.9 738.8 $933.5 867.2 571.6 $3,386.4 3,870.0 630.0 3,766.7 $11,315.9 12,361.9 $11,315.9 11,315.9 11,315.9

$6,062.8 5,719.5 5,395.8 $874.2 788.9 686.9 $591.8 513.8 419.0 $406.7 396.2 367.3 $1,040.1 20.5 0.0 1,535.3 $4,663.0 3,996.7 $4,896.9 5,892.4 6,902.4

$19,368.7 18,391.9 17,457.4 $2,355.2 2,218.3 1,817.0 $1,667.1 1,537.6 1,157.8 $1,340.1 1,263.4 938.9 $4,426.5 3,890.5 630.0 5,302.0 $15,978.9 16,358.6 $16,212.9 17,208.4 18,218.3

68.7% 68.9 69.1 62.9% 64.4 62.2 64.5% 66.6 63.8 69.7% 68.6 60.9 76.5% 99.5 100.0 71.0 70.8% 75.6 69.8% 65.8 62.1

31.3% 31.1 30.9 37.1% 35.6 37.8 35.5% 33.4 36.2 30.3% 31.4 39.1 23.5% 0.5 0.0 29.0 29.2% 24.4 30.2% 34.2 37.9

EBITDA

EBIT

Net Income

Cash(1) Total Debt(1) Minority Interest(1) Shareholders Equity(1) Equity Value(2) Enterprise Value Equity Value at $10.00 per Share Equity Value at $12.00 per Share Equity Value at $14.00 per Share

Pro Forma Merger Consequences SummaryNortel Acquires Aviator($ in millions, except for per share data)100% Stock Implied Exchange Ratio Premium to Market Earnings (Dilution)/Accretion Per Share ($) FY 2006E FY 2007E FY 2008E Earnings (Dilution)/Accretion Per Share (%) FY 2006E FY 2007E FY 2008E Additional Pre-Tax Earnings for 0% Dilution FY 2006E FY 2007E FY 2008E Closing Balance Sheet Cash Incremental Identifiable Intangible Assets Total Debt Equity FFO/Debt FY 2006E FY 2007E FY 2008E Total Debt/Capitalization Closing FY 2006E FY 2007E FY 2008E Total Debt/EBITDA Closing FY 2006E FY 2007E FY 2008E Pro Forma OwnershipAviator 3.779 x 4.9 % $0.01 (0.01 ) (0.01 ) 7.7 % (2.7 ) (3.7 ) NA 38.3 60.2 $4,306.0 692.3 3,870.0 8,663.6 41.5 % 50.5 52.7 29.4 % 27.6 25.4 23.4 2.9 x 2.1 1.7 1.6 30.2 % $10.00 per Share 25% Cash/ 75% Stock 2.834 x 4.9 % $0.02 0.01 0.01 13.6 % 3.4 2.4 NA NA NA $3,081.7 692.3 3,870.0 7,439.4 41.0 % 50.0 52.2 32.4 % 30.2 27.7 25.4 2.9 x 2.1 1.7 1.6 24.5 % 50% Stock/ 50% Cash 1.889 x 4.9 % $0.02 0.01 0.01 11.9 % 7.0 6.5 NA NA NA $3,001.2 692.3 5,030.0 6,215.1 33.6 % 41.9 43.9 42.4 % 37.0 33.9 31.0 3.8 x 2.5 2.0 1.9 17.8 % 100% Stock 4.534 x 25.9 % ($0.00 ) (0.02 ) (0.02 ) (0.6 %) (9.6 ) (10.5 ) $5.4 145.9 178.8 $4,306.0 891.4 3,870.0 9,659.1 41.6 % 50.6 52.8 27.3 % 25.8 23.9 22.1 2.9 x 2.1 1.7 1.6 34.2 % $12.00 per Share 25% Cash/ 75% Stock 3.401 x 25.9 % $0.01 (0.01 ) (0.01 ) 4.3 % (3.6 ) (4.3 ) NA 49.7 66.9 $3,000.0 891.4 4,038.7 8,186.0 40.1 % 49.2 51.4 31.4 % 28.9 26.6 24.5 3.1 x 2.2 1.8 1.7 28.1 % 50% Stock/ 50% Cash 2.267 x 25.9 % $0.00 (0.00 ) (0.00 ) 0.5 % (0.4 ) (0.6 ) NA 5.6 8.0 $3,011.6 891.4 5,545.0 6,712.9 31.2 % 39.4 41.3 43.0 % 36.9 34.0 31.4 4.2 x 2.6 2.1 2.0 20.7 % 100% Stock 5.290 x 46.9 % ($0.01 ) (0.03 ) (0.04 ) (8.1 %) (15.9 ) (16.6 ) $81.8 255.0 299.1 $4,306.0 1,093.4 3,870.0 10,669.1 41.6 % 50.6 52.9 25.5 % 24.2 22.5 21.0 2.9 x 2.1 1.7 1.6 37.9 % $14.00 per Share 25% Cash/ 75% Stock 3.968 x 46.9 % ($0.01 ) (0.02 ) (0.03 ) (5.5 %) (11.6 ) (11.9 ) $50.2 168.5 194.6 $3,021.4 1,093.4 4,320.0 8,943.5 35.9 % 44.1 46.1 31.1 % 29.4 27.3 25.4 3.3 x 2.4 1.9 1.8 31.4 % 50% Stock/ 50% Cash 2.645 x 46.9 % ($0.01 ) (0.02 ) (0.02 ) (10.4 %) (8.0 ) (7.7 ) $85.5 104.6 113.1 $3,023.3 1,093.4 6,070.0 7,217.9 28.4 % 36.1 37.9 43.6 % 37.3 34.7 32.2 4.6 x 2.8 2.3 2.2 23.4 %

Note: Financial projections based on Wall Street equity research and Bear Stearns Investment Banking estimates. Note: Fiscal year ending December 31. (1) As of December 31, 2005. (2) As of May 27, 2005.

Nortel Acquires AviatorSynergy Sensitivity AnalysisAssuming 50% Stock/50% CashPretax Synergies $250 $300 $350 $400 $450 $500

($ in millions, except per share data)

$10/share Earnings (Dilution)/Accretion Per Share ($) FY 2006E FY 2007E FY 2008E Earnings (Dilution)/Accretion Per Share (%) FY 2006E FY 2007E FY 2008E $12/share Earnings (Dilution)/Accretion Per Share ($) FY 2006E FY 2007E FY 2008E Earnings (Dilution)/Accretion Per Share (%) FY 2006E FY 2007E FY 2008E $14/share Earnings (Dilution)/Accretion Per Share ($) FY 2006E FY 2007E FY 2008E $0.03 0.02 0.02 $0.03 0.03 0.03 $0.04 0.04 0.04 $0.05 0.05 0.04 $0.06 0.06 0.05 $0.07 0.06 0.06 $0.04 0.04 0.04 32.1 % 19.8 17.7 $0.05 0.05 0.05 38.4 % 23.9 21.4 $0.06 0.06 0.05 44.7 % 27.9 25.1 $0.07 0.06 0.06 51.0 % 32.0 28.7 $0.08 0.07 0.07 57.3 % 36.0 32.4 $0.09 0.08 0.08 63.6 % 40.1 36.1 $0.06 0.06 0.06 44.5 % 28.0 10.0 $0.07 0.07 0.06 51.1 % 32.2 13.5 $0.08 0.07 0.07 57.6 % 36.4 17.0 $0.09 0.08 0.08 64.1 % 40.6 20.6 $0.09 0.09 0.09 70.7 % 44.8 24.1 $0.10 0.10 0.10 77.2 % 49.0 27.7

Note: Financial projections based on Wall Street equity research and Bear Stearns Investment Banking estimates. Assumes December 31, 2005 closing date. Earnings (Dilution)/Accretion Per Share (%) Assumes Nortel stock price of $2.65 and Aviator stock price of $9.53 (as of May 27, 2005). 26.1 FY 2006E 20.0 32.2 38.3 44.4 50.5 Assumes 20% of Excess of Purchase Price over Book Value is allocated to Incremental Identifiable Intangible Assets and is amortized (straight-line) over 10 years for book purposes. % %excess, if any, funded% a combination of % debt at L+350 and% % Assumes purchase funded with balance sheet cash subject to a $3.0 billion minimum cash balance; with bank senior notes at 8.19% for 50/50 FY 2007E 11.5 15.4 19.4 23.3 27.2 31.1 and 25/75 scenarios.

FY 2008E

10.0

13.5

17.0

20.6

24.1

27.7

Nortel Acquires AviatorSynergy Sensitivity AnalysisAssuming 100% StockPretax Synergies $250 $300 $350 $400 $450 $500

($ in millions, except per share data)

$10/share Earnings (Dilution)/Accretion Per Share ($) FY 2006E FY 2007E FY 2008E Earnings (Dilution)/Accretion Per Share (%) FY 2006E FY 2007E FY 2008E $0.05 0.03 0.03 35.5 % 15.1 (2.2 ) $0.05 0.04 0.03 41.0 % 18.7 0.6 $0.06 0.05 0.04 46.6 % 22.3 3.5 $0.07 0.05 0.05 52.1 % 25.8 6.4 $0.08 0.06 0.06 57.7 % 29.4 9.2 $0.08 0.07 0.06 63.2 % 33.0 12.1

$12/share Earnings (Dilution)/Accretion Per Share ($) FY 2006E FY 2007E FY 2008E Earnings (Dilution)/Accretion Per Share (%) FY 2006E FY 2007E FY 2008E $14/share Earnings (Dilution)/Accretion Per Share ($) FY 2006E FY 2007E FY 2008E Earnings (Dilution)/Accretion Per Share (%) $0.02 (0.00 ) (0.00 ) $0.03 0.01 0.00 $0.04 0.01 0.01 $0.04 0.02 0.01 $0.05 0.03 0.02 $0.06 0.03 0.03 $0.03 0.01 0.01 25.6 % 7.2 4.7 $0.04 0.02 0.02 30.8 % 10.5 7.7 $0.05 0.03 0.02 36.0 % 13.9 10.8 $0.06 0.03 0.03 41.3 % 17.2 13.8 $0.06 0.04 0.04 46.5 % 20.6 16.8 $0.07 0.05 0.04 51.7 % 24.0 19.9

FY 2006E FY 2007E FY 2008E

16.6 % (0.0 ) (2.2 )

21.6 % 3.1 0.6

26.5 % 6.3 3.5

31.4 % 9.5 6.4

36.4 % 12.7 9.2

41.3 % 15.8 12.1

pitch book

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converged voice applications

voice applications rental

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review of aviator section

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