1. M U R P H R E E V E N T U R E P A R T N E R S Murphree Venture Partners Early Stage Technology Investing May 15, 2003 Dennis E. Murphree Thomas J. Stephenson Elliott M. Bouillion

2. M U R P H R E E V E N T U R E P A R T N E R S Murphree Venture Partners Significant investment history –Founded in 1987 with over 50 investments to date Focused on early-stage investments in the Southwest –Growth technology from e-business to life science Organized to maximize ability to provide key services to portfolio companies –4 distributed offices and 6 partners Proven track record with multiple success stories –96.7% of portfolio has or will participate in IPO or M&A

3. M U R P H R E E V E N T U R E P A R T N E R S MVP Partners Dennis Murphree 25 years of direct investment experience Tom Stephenson Austin Technology Incubator Elliott BouillionLandmark Graphics, Founder Phoenix Computer Graphics John DennisKoch, Simmons & Company, Goldman, Sachs & Co. Geoff TudorFounder Genius Technology and Advent Networks Steve WaghBrown-Wagh (Sound Blaster), IBM 16 years average experience

4. M U R P H R E E V E N T U R E P A R T N E R S Murphree New Mexico Investments CompanyLocation Investment Date MicroOptical DevicesAlbuquerqueJune, 1996 Adaptive Learning Tech.Santa Fe (*)November, 1997 KinetisisLos AlamosFebruary, 1999 Elisar SoftwareAlbuquerqueNovember, 2000 MesofuelAlbuquerqueNovember, 2002 (*) Relocated to Austin, Texas 8/98

5. M U R P H R E E V E N T U R E P A R T N E R S What We Look for in a Deal The fundamentals: –Strong Team Doesn’t have to be complete P.I.H. (more on this later) –Excellent Market Opportunity $1B+ and growing (less for LS) Fragmented industry –A Proprietary Position Technology Competitive differentiation

6. M U R P H R E E V E N T U R E P A R T N E R S What We Look for in an Entrepreneur Passion: Passion: Will you walk through walls to make the deal work? Insight: Insight: Can you identify a market need and see an INNOVATIVE way to provide a solution? Humility: Humility: Do you know what you know, and know what you don’t?

7. M U R P H R E E V E N T U R E P A R T N E R S NM Industries of Interest Today Energy Software Optical and semiconductor devices Life Sciences (with a qualified lead) Now, more than ever, we are opportunistic in our investing.

8. M U R P H R E E V E N T U R E P A R T N E R S Murphree NM Involvement Coronado Ventures Forum NM Info. Technology & SW Association TVC Equity Capital Symposium Advisors LANL IBD External Advisory Board UNM Management of Technology Program Advisory Board NMSU Physical Sciences Lab Advisory Board Leadership New Mexico NM presence since 1996, full time since 1997NM presence since 1996, full time since 1997

9. M U R P H R E E V E N T U R E P A R T N E R S Characteristics of all MVP NM Deals Extremely early (seed) stage Proprietary Technology Huge Market opportunity Strong Entrepreneurs Incomplete management team

10. M U R P H R E E V E N T U R E P A R T N E R S Characteristics of all MVP NM Deals Extremely early (seed) stage Proprietary Technology Huge Market opportunity Strong Entrepreneurs Incomplete management team Average Time from First Meeting to Full Funding: 11 Months

11. M U R P H R E E V E N T U R E P A R T N E R S What’s Next for New Mexico VC Dollars are on the rise –92 Investors at TVC Symposium Serial Entrepreneurs are growing in number –Ned Godshall (SMD, Kinetisis, Mesofuel) –Waneta Tuttle (Indigo, PhDx, Exagen) –Paul Shirley (SVS, Qynergy) localBig, local success has still eluded us

12. M U R P H R E E V E N T U R E P A R T N E R S Contact Information www.murphreeventures.com Thomas J. Stephenson 1 Technology Center 1155 University Blvd. SE Albuquerque, NM 87106 TEL: (505) 843-4277 FAX: (505) 843-4278 TStephenson@MurphreeVentures.com