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EXECUTIVE OVERVIEW CONFIDENTIAL San Francisco 49 Stevenson Street, 14th Floor San Francisco, CA 94105 (415) 974-5888 www.hlhz.com New York Los Angeles Chicago San Francisco Washington, D.C. Minneapolis Dallas Atlanta Toronto Seoul Confidential Executive Overview This Confidential Executive Overview (“Memorandum”) has been prepared for discussion purposes only. This Memorandum is submitted on a confidential basis for use by a limited number of parties solely in connection with a potential transaction with nCUBE Corporation (the “Company”). This Memorandum is being delivered, on behalf of the Company by Houlihan Lokey Howard & Zukin Capital (“Houlihan Lokey” or the “Advisor”), to assist the recipient in deciding whether to proceed with a further investigation of the Company. By accepting this Memorandum, the recipient agrees to keep confidential the information contained herein or made available in connection with any further investigation of the Company. In addition, the recipient agrees not to reproduce this Memorandum in whole or in part, and if the recipient does not wish to pursue an investigation of the Company, the recipient will return this Memorandum to Houlihan Lokey as soon as practicable, together with any other materials relating to the Company which the recipient may have received from Houlihan Lokey or the Company. Houlihan Lokey, as financial advisor to the Company, has relied on the Company’s representations as to the truth, accuracy and completeness of statements made herein. The Memorandum uses phrases like “the Company expects,” “the Company believes,” “the Company anticipates,” and similar phrases. These phrases do not constitute warranties or guarantees of any kind, expressed or implied, but merely represent the opinion of the Company based upon the best information available, and is subject to change without notice. Further, Houlihan Lokey and the Company expressly disclaim any and all liability for any written or oral communication transmitted or made available to an interested party. Qualified parties who are interested in pursuing a transaction will be given the opportunity to conduct a due diligence investigation and ultimately enter into an agreement containing such representations and warranties concerning the transaction and the Company as are agreed to by the parties. The Company reserves the right to negotiate with one or more parties at any time and to enter into a definitive agreement with respect to a transaction with the Company, or to determine not to proceed with a transaction with the Company, without prior notice to you or any other party. The Company reserves the right to terminate, at any time, further participation in the investigation and proposed process by any party, and to modify any procedures without assigning any reason therefor. The Company shall have no legal commitment or obligation to any party reviewing this Memorandum, unless a written agreement regarding the transaction has been fully executed, delivered and approved by the Company, and any conditions to the Company’s obligations thereunder have been satisfied or waived. All communications or inquiries relating to the Company or this Memorandum should be directed to the representatives of Houlihan Lokey listed below. No personnel at the Company may be contacted directly unless expressly permitted by the Advisor. HOULIHAN LOKEY HOWARD & ZUKIN CAPITAL I N V E S T M E N T B A N K E R S 49 Stevenson Street, 14th Floor San Francisco, California 94105-2909 (415) 974-5888 Matthew B. Venturi Jennifer S. Muller Mark J. Schade Managing Director Vice President Senior Associate Ayesha D’Souza Senior Financial Analyst February 2000 i Executive Summary Company Overview nCUBE Corporation (“nCUBE” or the “Company”) (www.ncube.com) is the world’s leading supplier of highly scalable, high performance broadband streaming media systems. nCUBE’s products meet the demands of the most challenging broadband, Internet and broadcast video applications. The Company’s streaming media appliances can be scaled to serve dozens, hundreds or many thousands of simultaneous users via cable television, telecom (xDSL) and Internet Protocol (IP) networks. nCUBE’s unique hypercube architecture has significant scalability, cost and performance advantages over both general purpose servers and other appliances for video streaming applications. nCUBE also delivers total solutions that combine the Company’s streaming media systems with software applications and technical services for applications such as broadband video-on-demand (VOD), IP Streaming Media and Advertising Insertion. nCUBE was purchased in 1989 by Oracle founder & CEO Lawrence J. Ellison, whose insights and influence have been a major factor in developing nCUBE’s strategy and market focus. nCUBE is headquartered in the San Francisco Bay Area. nCUBE has unequalled experience in performing commercial installations and market trials of broadband video- on-demand (VOD) with major cable operators and telecom providers worldwide. Having many years of experience in VOD technology and installations and currently deploying the Company’s fourth generation streaming systems, nCUBE is the leading provider in those markets. The Company has in excess of 20,000 deployed broadband VOD streams representing over $55 million in revenues - more broadband on-demand video streams and revenues than any other provider in the market. The Company’s cable customers include AT&T, Adelphia, Comcast, Charter, Insight, MediaOne, Shaw, Telewest, Time Warner and UnitedGlobalCom. Telecommunications customers include Ameritech, Austria Telecom, British Telecom, Bell Atlantic, Deutsche Telekom, GTE, Israeli Telecom, NTT, Singapore Telecom and Telecom Italia. The Company’s management believes that the leveraging of nCUBE’s global customer base, combined with the unique scalability and reliability characteristics of its products, will allow the Company to maintain its leadership position and help the Company grow to over $150 million in annual revenues by 2002. At the same time, management believes the same technical advantages that have enabled it to excel in the broadband VOD market will position it to lead the IP streaming media and caching appliance markets. Moreover, many of the Company’s VOD and ad insertion customers are likely to be among the largest purchasers of these appliances, enabling the Company to further leverage its installed base and customer relationships. nCUBE’s products are sold through a direct sales force located among seven sales and support facilities worldwide, and increasingly through local and international resellers and integrators. The Offering nCUBE is offering $50 million of Series A Preferred Stock, or approximately ____ shares (the “Series A Shares” or the “Offering”) to a selected number of strategic investors. Each Series A Share will be convertible into one share of the Company’s common stock (“Common Stock”) upon the initial public offering of the Company’s Common Stock. To date, the Company has been primarily financed by its majority shareholder and CEO, Larry Ellison, who currently owns approximately 65 percent of the Company. Market Opportunity As bandwidth constraints are gradually addressed by the installation of higher-bandwidth, interactive media distribution systems, on-demand and interactive media are expected to proliferate. Forrester Research forecasts that broadband penetration in the U.S., including digital subscriber lines (DSL), and cable and satellite modems, Houlihan Lokey Howard & Zukin Capital 2 Confidential & Restricted Executive Summary will increase from six million subscribers in 2000 to 19 million subscribers by 2002. This trend, along with the convergence of data and video and the emergence of digital set-top boxes, has created a tremendous opportunity for media companies and advertisers to provide customized and interactive programming and advertising. As a result the addressable markets for streaming media are large and growing at an unprecedented rate. The specific vertical markets of nCUBE’s server appliance products are as follows: VOD/NVOD market. Due to bandwidth constraints and the lack of two-way digital cable networks, video-on- demand (VOD) has not been cost-effective or technologically feasible until now. Cable operators have been providing only pay per view (PPV) and near video-on-demand (NVOD) services to date. With the upgrade of systems to digital cable technology in full swing, cable operators in North America and Europe have begun to test and roll out advanced services including VOD on their digital networks. Forrester Research estimates that there will be 12 million cable subscribers with access to VOD programs generating approximately $3.1 billion in new revenues in 2005. VOD represents one of the most valuable tools cable operators possess in competing against satellite television services, and is thus on the roadmap of virtually every major cable operator in North America and Europe. In addition, VOD enables broadband operators to utilize streaming video as part of their “walled garden” or “broadband portal” e-commerce initiatives. These factors, combined with the rapid drop in the cost of streaming media systems, have substantially improved the return-on-investment prospects for VOD for broadband operators during the past 12 months. IP Streaming Media Appliances. As high-bandwidth connections are made possible through cable modem and DSL service penetration, video is widely expected to become one of the primary communications media of the Internet