EX-99.(C)(2) 3 dex99c2.htm PRESENTATION OF MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED Presentation of Merrill Lynch, Pierce, Fenner & Smith Incorporated
Presentation to the Special Committee of the
Board of Directors and the Board of Directors of
Newton
Regarding Project Discovery
October 10, 2005
CONFIDENTIAL
Exhibit (C)(2)

CONFIDENTIAL
Presentation to the Special Committee of the Board of
Directors and the Board of Directors of Newton
Disclaimer
The
information
contained
in
this
presentation
was
obtained
solely
from
Newton
(“Newton”)
management
and
from
public
sources.
Merrill
Lynch,
Pierce,
Fenner
&
Smith
Incorporated
(“Merrill
Lynch”)
has
used
and
relied
upon
such
information
in
the
preparation
of
this
presentation
and
does
not
assume
responsibility
for
independent
verification
of
any
such
information,
and
makes
no
representation
or
warranty
in
respect
of
the
accuracy
or
completeness
of
such
information
This presentation has been prepared for the use of the Board of Directors, the Special Committee of the Board of
Directors and Management of Newton only. It is confidential and may not be disclosed or provided to any third
parties except as may be required by applicable law or the Securities and Exchange Commission. This material is not
intended to provide the sole basis for evaluation of the transaction, does not purport to contain all information that
may be required and should not be considered a recommendation with respect to the transaction. This material was
prepared for a specific use by specific persons and was not prepared with a view to public disclosure or to conform
with any disclosure standards under securities laws or otherwise
This
presentation
is
prepared
as
of
October
6,
2005
and
reflects
information
made
available
to
us
prior
to
such
date.
It
does
not
include
information
regarding
all
of
the
assessments
made
by
Merrill
Lynch
in
arriving
at
its
conclusions.
Actual
results
may
vary
from
the
estimates,
valuations
or
projections
and
such
variations
may
be
material

CONFIDENTIAL
Table of Contents
Regarding Project Discovery
1.  Overview of Proposed Transaction
2.  Review of Process
3.  Situation Overview
4.  Review of Newton Financial Projections
5.  Newton Valuation Analysis
Appendix
-
“Rules of the Road”

Overview of Proposed Transaction

CONFIDENTIAL
1
Overview of Proposed Transaction
Summary of Proposed Terms
Proposed Transaction:
$10.00
cash
per
share
for
100%
of
Newton
common
stock
not
held
by
VUN
(“Minority
Shares”)
(1)
$10.00
cash
per
share
for
2.5
million
shares
of
Newton
common
stock
held
by
VUN
(“VUN
Shares”)
(2)
Represents $2.34 of cash per VUN share
Remaining VUN shares exchanged for Galileo equity equal to approximately 14.5% of total equity
Financing:
Combination of Galileo and Newton available cash and a $110 million commitment letter from GE
Capital
$85 million Term Loan
$25 million Revolving Credit Facility
Transaction conditioned upon funding such commitment
Options and Unvested
Restricted Shares:
All unvested options and unvested restricted shares vest upon close
Existing
options
will
be
converted
into
the
right
to
receive
an
amount
in
cash
equal
to
the
difference
between
the
offer
price
of
$10.00
and
the
aggregate
exercise
price,
multiplied
by
the
number
of
shares
of
common
stock
underlying
the
options
Tax Treatment:
Transaction taxable to Newton stockholders to extent of cash received
____________________
(1)
Assumes 10.0mm Minority Shares.
(2)     Assumes 10.7mm VUN Shares.

CONFIDENTIAL
2
Overview of Proposed Transaction
Summary of Proposed Terms (Cont’d)
Reps and Warranties:
Customary representations and warranties for transactions of this type in this industry
Covenants:
Customary covenants for transactions of this type in this industry
Termination:
Galileo may terminate if Newton’s Board/Special Committee
(i)   modifies or withdraws its recommendation
(ii)  endorses or enters into an alternative transaction
(iii) fails to recommend rejection of a third party tender offer
Subject
to
Galileo’s
right
to
match,
Newton
may
terminate
in
order
to
accept
a
superior
proposal
Standard termination provisions, including
(i)  termination by one party for breaches of certain of the other party’s obligations or uncured
breaches of its representations and warranties
(ii) mutual termination rights for failure to obtain the required stockholder approval at the
stockholder meeting
Conditions to Closing:
Absence of material adverse effect on Newton business
Stockholder
approval
by
a
majority
of
the
outstanding
shares,
as
well
as
a
majority
of
the
voting
Minority Shares
Consummation of share exchanges with VUN stockholders
Funding under financing commitment
Regulatory approvals, including Hart-Scott clearance

CONFIDENTIAL
3
Overview of Proposed Transaction
Summary of Proposed Terms (Cont’d)
Break-up Fees:
Termination fee of $4,375,000 payable in cash by Newton to Galileo
(i)  if
Galileo
terminates
because
Newton’s
board
changes
its
recommendation
(ii) Newton terminates to accept a superior proposal
If
either
party
terminates
because
the
required
stockholder
approval
is
not
received
before
the
drop-
dead
date
or
Newton
fails
to
comply
with
its
covenants
under
the
merger
agreement,
and
a
third
party
has
made
a
proposal
to
acquire
Newton
before
such
termination,
then
(i)  Newton must pay Galileo’s expenses up to $500,000
(ii) if Newton enters into an alternative transaction within 12 months of termination, Newton
must pay Galileo $4,375,000 less the expenses previously paid
Termination
fee
of
$4,375,000
payable
in
cash
by
Galileo
to
Newton
if
either
party
terminates
the
merger
agreement
because
Galileo
has
not
secured
financing
prior
to
the
drop-dead
date
No Solicitation:
No solicitation, no talk clause with superior proposal out
Newton informs Galileo of any alternative proposal and details
Galileo
has
option
for
3
business
days
to
improve
offer
so
that
third-party
proposal
will
not
be
deemed
a
superior
proposal
If
Newton
receives
a
proposal
that
is
reasonably
likely
to
result
in
superior
proposal
and
Special
Committee
determines
in
consultation
with
legal
counsel
that
it
is
inconsistent
with
fiduciary
duties
to
not
respond,
Newton
may
furnish
confidential
information
under
a
confidentiality
agreement
and
negotiate
proposal
Newton
obligated
to
present
the
Merger
Agreement
for
stockholder
approval
even
if
there
is
a
superior
proposal
and
Newton
Board
changes
recommendation

CONFIDENTIAL
4
Overview of Proposed Transaction
Summary of Proposed Terms (Cont’d)
Expected Closing Date /    
“Drop
Dead”
Date:
Transaction must be consummated by February 28, 2006
If
the
only
unsatisfied
closing
conditions
are
receipt
of
HSR
and
other
regulatory
approvals
or
removal
of
restraining
orders,
then
the
date
is
extended
until
April
30,
2006
Corporate Governance:
VUN will receive two Board seats at Galileo
Newton will have no representation on Board of Galileo

CONFIDENTIAL
5
(Amounts in Millions, Except per Share Data)
Overview of Proposed Transaction
Implied Valuation Metrics
____________________
(1)
Implied
value
based
on
price
to
Minority
stockholders;
does
not
intend
to
reflect
the
value
received
for
VUN
shares.
(2)
Represents
closing
stock
price
on
January
11,
2005.
Announcement
occurred
after
market
close.
(3)
Revenue
and
EBITDA
multiples
based
on
transaction
value.
(4)
Represents
management’s
Base
Case
estimates;
assumes
renegotiation
of
OA
resulting
in
annual
revenue
of
$45million
beginning
January
1,
2006.
Offer Price per Share to Minority Stockholders:
$10.00
Fully Diluted Shares Outstanding:
20.9
Implied Offer Value:
(1)
$209.1
Less Net Cash:
($39.7)
Transaction Value:
$169.5
Premium Analysis:
Day before Strategic Announcement
(2)
43.5%
Current
17.4%
1 Month Average
23.6%
3 Month Average
31.9%
6 Month Average
35.0%
1 Year Average
27.6%
52-Week High
9.94
0.6%
Implied Multiples:
(3)
Implied Multiples
2006E Adjusted Revenue
2.7x
2006E Adjusted EBITDA
16.0x
2006E Adjusted EPS
76.5x
7.41
$62.1
10.6
0.13
7.84
Base Case Results
(4)
7.58
8.52
Premiums
Closing Price
8.09
$6.97

CONFIDENTIAL
6
Overview of Proposed Transaction
Key Outsourcing Agreement (OA) Terms
Concurrent with the negotiation of the definitive purchase agreement, VUN and Galileo have
negotiated an outsourcing agreement;
Key terms are as follows:
Current
Outsourcing Agreement
Galileo
Agreement Termination:
4.5 years (3/31/2010)
6 years (12/31/2011)
Outsourcing Agreement Fee:
2006
$61mm, but subject to Benchmarking
$48mm
2007
$61mm, but subject to Benchmarking
$42mm
2008
$61mm, but subject to Benchmarking
$34mm
Thereafter
$61mm, but subject to Benchmarking
$34mm
Member-Based Pricing:
No
Incentive plan; Members ramp
to $12mm in 2011
Commitment to Current Roadmap:
Yes
No (more narrow scope of service)
Benchmarking:
Yes
No
Change of Control Provision:
Yes
TBD
Other:
NA
$975k of annual payments
for other services

Review of Process

CONFIDENTIAL
7
Review of Process
On
October
18,
2004,
Newton’s
Board
decided
to
evaluate
strategic
alternatives;
on
October
21,
a
Special
Committee was established
On December 3, 2004, Merrill Lynch was engaged
On
January
11,
2005,
Newton
issued
a
press
release
announcing
it
had
hired
Merrill
Lynch
to
explore
strategic
alternatives
Merrill Lynch conducted a broad auction process, contacting approximately forty-one potential buyers
Proactively contacted a broad universe of potential buyers and responded to all incoming inquiries
Parties
expressing
an
interest
were
given
a
summary
“Teaser”
of
public
information
Of those expressing preliminary interest, fifteen parties executed an NDA and received a confidential
information package, which included among other information:
Detailed review of business
Financial projections
Summary of VUN Outsourcing Agreement
Information regarding Newton’s net operating loss

CONFIDENTIAL
8
Review of Process
In order to better facilitate an understanding of the opportunity, Newton held introductory management
discussions in San Jose for those parties demonstrating interest
Discussions were tailored to each respective buyer
Seven parties participated
In
addition,
Newton
facilitated
follow-up
financial
and
technical
diligence
On
April
18,
2005,
VUN
announced
its
intention
to
be
a
seller
of
its
Newton
shares
under
certain
conditions
including
the
renegotiation
of
the
OA;
VUN
also
disclosed
that
based
on
results
of
a
CSC
study,
it
believed
the
fee
it
is
paying
Newton
was
significantly
above
a
market
competitive
price
OA stipulates VUN’s right to “Benchmark”
On
May
9,
2005,
Galileo
submitted
a
preliminary
non-binding
indication
of
interest
reflecting
the
following
key
terms:
$10.00 per share for the Minority Shares
VUN
would
receive
a
25%
interest
in
Galileo
in
exchange
for
100%
of
the
VUN
Shares
Subsequent
to
the
receipt
of
this
indication
of
interest,
Newton
and
VUN
established
rules
to
govern
the
bidding
and negotiation process –
the “Rules of the Road”
(see Appendix)
Bid structure would include both valuation for Newton shares as well as a proposal regarding the OA
Timing and structure of joint Newton/VUN diligence sessions (attendees, agenda, etc.)
Process for seeking clarification on bid submissions
Outline for final negotiation
(Cont’d)

CONFIDENTIAL
9
Review of Process
On May 29, 2005, as per the “Rules of the Road,”
Newton provided VUN a list of the seven parties who
continued to express interest in a transaction
Newton
and
VUN
agreed
that
all
seven
parties
would
be
invited
to
continue
in
the
process
Of these, two parties chose to remove themselves from the process and five agreed to participate in joint
Newton / VUN sessions
In
advance
of
the
meetings,
the
potential
bidders
received
a
detailed
“Scope
of
Services”
document
from
VUN
that
highlighted
their
expectations
with
respect
to
the
negotiation
of
a
new
Outsourcing
Agreement
During
June
2005,
the
joint
diligence
sessions
were
conducted
in
Dallas
at
VUN’s
headquarters
Detailed
discussion
of
the
VUN
Outsourcing
Agreement
“Scope
of
Services”
document
Discussion of the interested parties’
rationale for pursuing a transaction and qualifications relative to
performance under the Outsourcing Agreement
Meetings
were
supplemented
with
follow-up
calls
and
break-out
sessions
On July 1, 2005, Merrill Lynch distributed to the five interested parties a procedures memo detailing the process
and outlining requirements for submitting an initial bid
Bid submission date of July 29, 2005
(Cont’d)

CONFIDENTIAL
10
Review of Process
Additionally, in early July 2005, the five interested parties received the following information to assist in their
submission of a final bid:
Draft Purchase Agreement
Access to an online dataroom
On July 29, 2005, two parties submitted written acquisition proposals
Galileo
–
Proposal :
–
Outsourcing
Agreement :
Proposed
annual
fee
of
$50mm
in
2006,
$45mm
in
2007
and
$37mm
in
2008
and
thereafter,
expiring
in
2011
–
Other :
Also
submitted
a
mark-up
of
the
Purchase
Agreement
and
a
financing
commitment
letter
from
GE
Capital
Faraday
–
Proposal :
–
Outsourcing
Agreement :
Proposed
annual
fee
of
$45mm
in
2006
and
volume-based
thereafter
–
Other:
Faraday
did
not
submit
a
mark-up
of
the
Purchase
Agreement;
only
a
short
summary
of
how
they
would
approach
the
contract
(Cont’d)
$10.00
per
share
for
all
Minority
Shares
$10.00
per
share
for
1
million
VUN
Shares
Holders
of
VUN
Shares
would
also
receive
equity
of
the
pro
forma
entity
equal
to
21%
$7.75
per
share
for
all
Minority
Shares
$2.75
per
share
for
all
VUN
Shares

CONFIDENTIAL
11
Review of Process
On August 5, 2005, these proposals were reviewed with the Special Committee
Pursuant to the “Rules of the Road,”
Merrill Lynch shared these bids with VUN, redacting all references to the
proposed value per share to be paid for the outstanding Newton stock
During
August,
Merrill
Lynch,
VUN
and
Newton
conducted
follow-up
conversations
with
both
bidders
to
provide
feedback and gain clarification regarding their proposal
VUN indicated that the Faraday proposal was not a viable option
On August 17, 2005, Galileo, Newton and VUN met in Dallas to discuss the initial bid and provide detailed
feedback on Galileo’s proposal
Subsequently, Galileo revised its bid, increasing the cash consideration to VUN from $10 million to $20 million,
reducing the scope of services to be provided under the OA and reducing its annual fee proposal to current levels
On August 31, 2005, based on further feedback, Galileo revised its bid to the current terms and entered into an
exclusive negotiation with Newton and VUN
During September and October, the parties held several meetings to advance the negotiations
Accounting diligence in San Jose
Meetings to negotiate the Purchase Agreement and OA
Further technical diligence
Negotiation and diligence of Galileo’s financing commitment
(Cont’d)

Situation Overview

CONFIDENTIAL
12
Situation Overview
Expect Adjusted Revenues and EBITDA to decline in
2005
Newton's "growth" business is not growing
Non-Related Party (NRP) revenue is expected to
decline from 2004 levels
Forecasted growth in 2006 dependent on
reversing historical trend
Structural and environmental challenges that
precipitated Project Discovery still exist
Management continues to believe in the market
opportunity, but not attainable by Newton given flaws
in current relationship and structure
Significant frustration and unrest in the employee base
creating retention challenges
Fundamental challenges remain
VUN majority ownership position
VUN OA rights (exclusivity, benchmarking, CIC)
Significant public company costs
VUN approach to M@N and relationship with
Newton has changed materially
VUN has changed its e-commerce strategy to
"low cost" from "highly differentiated"
Interested in reducing scope in order to lower
costs
Spend Intelligence offering, a primary growth
driver for NRP revenue, is now perceived by
VUN as competitive; recently announced new
spend analytics division
Driven by GPO competitive landscape and financial
performance of hospitals
Value of VUN relationship and channel declining
Primary growth avenue –
ability to leverage
channel –
is now questionable
Unclear whether VUN desires an ongoing
relationship with Newton
General
Status of VUN Relationship

CONFIDENTIAL
13
Situation Overview
Future of Outsourcing Agreement
Absent a Project Discovery transaction, Newton expects revenue under OA to decrease
VUN
committed
to
achieving
$15
-
$25mm
decrease
in
annual
fee
and
has
the
right
under
the
OA
to
“Benchmark”
as a means of effecting a fee reduction
If
Newton
refuses
to
negotiate,
VUN
expected
to
pursue
benchmarking
-
which
could
reasonably
be
expected
to
result
in
a
lower
fee
and
likely
to
eliminate
any
chance
of
a
continuing
relationship
after
March
2010
Newton
does
not
believe
VUN
would
allow
member-based
pricing
to
overcome
a
reduction
in
OA
fees
Increasingly apparent, there is a very real risk that agreement would not be renewed in 2010
Newton now believes VUN will engage in competitive bid process
Per
the
agreement,
VUN
will
receive
necessary
licenses
to
M@N
intellectual
property,
as
well
as
transfer
assistance
to
move
M@N
to
a
3
rd
party
of
VUN's
choosing
Galileo appears to be in an excellent position to win a competitive bid
–
VUN is willing to consider utilizing Galileo's platform
–
Synergies,
lack
of
public
company
costs
and
not-for-profit
orientation
positions
Galileo
to
propose
a
very
competitive fee

CONFIDENTIAL
14
Situation Overview
Stand Alone Strategy
Newton would seek to negotiate new OA with VUN
In exchange for a significant reduction in annual fee, Newton would:
Narrow scope and cost of OA
Reach a deal to pursue Spend Intelligence opportunity
Negotiate other key terms (extension, benchmarking, CIC)
If
unable
to
negotiate,
parties
would
likely
invoke
benchmarking
right
Likely to reduce fee; exposed to risk of potentially dramatic fee reduction
Acrimonious process could irreparably harm relationship and create a challenging operating environment
Would likely result in VUN not renewing contract in 2010
Uncertainty and distraction for employees, etc.
Many variables could change in a negotiation scenario:
Fee
Duration
Scope
Ability to leverage VUN channel to grow business

CONFIDENTIAL
15
Situation Overview
Scenarios Analyzed
We have analyzed four possible OA outcomes going forward:
Scenario 1:  Base Case:
Assumes negotiations result in $45mm annual fee through the current term (March 2010) vs. Galileo fee
proposal of ~$38.7mm/year
–
VUN
would
likely
seek
to
match
Galileo
proposal
of
$38.7
million
per
year
After March 2010, assume new lower annual fee of $25mm
–
Newton expects VUN to engage in competitive bidding process
–
Intellectual
property
rights
would
allow
Newton
to
transfer
M@N
to
a
low
cost
provider
Base
Upside
Downside
"Win" BM
OA Annual Fees Through March 2010
$45mm
$45mm
$40mm
$61mm
OA Annual Fees Thereafter
$25mm
$45mm
$0mm
$0mm

CONFIDENTIAL
16
Situation Overview
Scenario 2:  Upside Case:
Assumes negotiations result in $45mm annual fee through the current term (March 2010) vs. Galileo fee
proposal of ~$38.7mm/year
–
VUN
would
likely
seek
to
match
Galileo
proposal
of
$38.7
million
per
year
After March 2010, relationship continues at $45mm annual fee
Scenario 3:  Downside Case:
Assumes negotiations result in $40mm annual fee through the current term (March 2010) vs. Galileo fee
proposal of ~$38.7mm/year
After March 2010, relationship ends
–
VUN engages in competitive bidding process
–
Transfers
M@N
to
3
rd
party
Scenario 4:  "Win" Benchmarking Case:
Newton
achieves
best
case
scenario
–
retaining
$61mm
annual
fee
through
the
current
term
(March
2010)
–
Assumes
VUN
does
not
reduce
M@N
scope
and
engage
in
another
round
of
benchmarking
After March 2010, relationship ends
–
VUN engages in competitive bidding process
–
Transfers
M@N
to
3
rd
party
Scenarios Analyzed (Cont'd)

Review of Newton Financial Projections

CONFIDENTIAL
17
Key Modeling Assumptions
Review of Newton Financial Projections
Projections 2006 -
2008
Cost reduction initiatives including:
Management reduction
Significant outsourcing/offshoring of PDS and CSS operations
At
lower
OA
fee
levels,
scope
is
assumed
to
be
more
narrow
-
enabling
use
of
fewer
outsourced
contract
workers
NRP revenue CAGR of 30%
An optimistic assumption given recent developments
Would require a wholesale change in VUN mindset
Move to new facility at April 1, 2007 at significantly reduced cost
MMS business (provider and supplier) operations abandoned/divested

CONFIDENTIAL
18
Key Modeling Assumptions (Cont'd)
Review of Newton Financial Projections
Non-Related
Party
(NRP)
revenue
grows
at
20%
from
2008
–
2010
Related Party (RP) revenue assumes OA revenue by case plus flat Market Intelligence and HCO Implementations
G&A
expenses
grow
at
4%
per
year;
RP
expenses
grow
at
5%
per
year
G&A
expenses
drop
by
5%
when
RP
revenue
drops
to
$25
million
in
the
Base
Case
and
by
15%
when
RP
revenue drops to $0 million
RP expenses are 70% of RP revenue when RP revenue drops in the Base Case
NRP expenses are 72% of NRP revenue in 2009 and 70% in 2010
Depreciation of fixed assets equals capital expenditures which remain flat at 2008 percent of sales
Depreciation
of
capitalized
software
equals
capitalized
software
development
costs
which
remain
flat
at
2008
percent of gross operating expense
Working capital assumptions for A/R, A/P and deferred revenue remain flat at 2008 percent of NRP revenue,
gross operating expense and NRP revenue, respectively.  All other working capital accounts remain flat
Projections beyond 2008

CONFIDENTIAL
19
Summary
Financials
-
Base
Case
(Dollars in Thousands)
Review of Newton Financial Projections
Assumes
OA
revenue
of
$45
million
through
March
13,
2010
and
$25
million
thereafter
____________________
(1)
Adjusted Net Income equals EBITDA less depreciation and amortization plus interest income; excludes amortization of deferred compensation.  No taxes due to utilization
of NOLs.
Fiscal Year Ended
Pro Forma
CAGR
CAGR
2005E
2006E
2007E
2008E
2009E
2010E
2010E
'03 -
'05
'05 -
'10
Adjusted Revenue
Related Party
$61,522
$45,305
$45,204
$45,106
$45,106
$30,106
$25,106
(6.3%)
(16.4%)
Non-Related Party
12,064
16,784
22,573
31,004
37,205
44,646
44,646
8.6%
29.9%
Total Adjusted Revenue
73,586
62,089
67,777
76,110
82,311
74,752
69,752
(4.2%)
(1.1%)
G&A Expenses
NA
16,128
14,736
14,601
15,185
15,200
15,003
Related Party Operating Expenses
NA
21,493
20,540
21,609
22,689
19,137
17,574
Non-Related Party Operating Expenses
NA
17,355
20,244
23,073
26,787
31,252
31,252
Gross Operating Expense
59,996
54,976
55,520
59,283
64,662
65,589
63,829
0.8%
1.2%
% of Total Sales
81.5%
88.5%
81.9%
77.9%
78.6%
87.7%
91.5%
Plus: Capitalized SW Development Costs
3,464
3,448
3,694
3,940
4,297
4,359
4,242
EBITDA
17,054
10,561
15,951
20,767
21,946
13,522
10,165
(10.3%)
(9.8%)
Margin %
23.2%
17.0%
23.5%
27.3%
26.7%
18.1%
14.6%
Adjusted Net Income
(1)
9,499
2,671
7,946
14,213
15,481
7,440
4,462
16.7%
(14.0%)
Margin %
12.9%
4.3%
11.7%
18.7%
18.8%
10.0%
6.4%
Adjusted EPS
$0.48
$0.13
$0.38
$0.66
$0.70
$0.32
$0.19
11.6%
(16.4%)

CONFIDENTIAL
20
Summary
Financials
-
Upside
Case
(Dollars in Thousands)
Review of Newton Financial Projections
Assumes OA revenue of $45 million in perpetuity
Fiscal Year Ended
CAGR
CAGR
2005E
2006E
2007E
2008E
2009E
2010E
'03 - '05
'05 - '10
Adjusted Revenue
Related Party
$61,522
$45,305
$45,204
$45,106
$45,106
$45,106
(6.3%)
(6.0%)
Non-Related Party
12,064
16,784
22,573
31,004
37,205
44,646
8.6%
29.9%
Total Adjusted Revenue
73,586
62,089
67,777
76,110
82,311
89,752
(4.2%)
4.1%
G&A Expenses
NA
16,128
14,736
14,601
15,185
15,792
Related Party Operating Expenses
NA
21,493
20,540
21,609
22,689
23,824
Non-Related Party Operating Expenses
NA
17,355
20,244
23,073
26,787
31,252
Gross Operating Expense
59,996
54,976
55,520
59,283
64,662
70,868
0.8%
3.4%
% of Total Sales
81.5%
88.5%
81.9%
77.9%
78.6%
79.0%
Plus: Capitalized SW Development Costs
3,464
3,448
3,694
3,940
4,297
4,710
EBITDA
17,054
10,561
15,951
20,767
21,946
23,593
(10.3%)
6.7%
Margin %
23.2%
17.0%
23.5%
27.3%
26.7%
26.3%
Adjusted Net Income
(1)
9,499
2,671
7,946
14,213
15,481
16,639
16.7%
11.9%
Margin %
12.9%
4.3%
11.7%
18.7%
18.8%
18.5%
Adjusted EPS
$0.48
$0.13
$0.38
$0.66
$0.70
$0.73
11.6%
8.7%
____________________
(1)
Adjusted Net Income equals EBITDA less depreciation and amortization plus interest income; excludes amortization of deferred compensation.  No taxes due to utilization
of NOLs.

CONFIDENTIAL
21
Summary
Financials
-
Downside
Case
(Dollars in Thousands)
Review of Newton Financial Projections
Assumes
OA
revenue
of
$40
million
through
March
31,
2010
without
renewal
____________________
(1)
Adjusted Net Income equals EBITDA less depreciation and amortization plus interest income; excludes amortization of deferred compensation.  No taxes due to utilization
of NOLs.
Fiscal Year Ended
Pro Forma
CAGR
CAGR
2005E
2006E
2007E
2008E
2009E
2010E
2010E
'03 -
'05
'05 -
'10
Adjusted Revenue
Related Party
$61,522
$40,305
$40,204
$40,106
$40,106
$10,106
$0
(6.3%)
(100.0%)
Non-Related Party
12,064
16,784
22,573
31,004
37,205
44,646
44,646
8.6%
29.9%
Total Adjusted Revenue
73,586
57,089
62,777
71,110
77,311
54,752
44,646
(4.2%)
(9.5%)
G&A Expenses
NA
16,128
14,736
14,601
15,185
14,016
13,424
Related Party Operating Expenses
NA
21,103
19,968
20,979
22,028
5,782
0
Non-Related Party Operating Expenses
NA
17,355
20,244
23,073
26,787
31,252
31,252
Gross Operating Expense
59,996
54,586
54,948
58,653
64,000
51,050
44,676
0.8%
(5.7%)
% of Total Sales
81.5%
95.6%
87.5%
82.5%
82.8%
93.2%
100.1%
Plus: Capitalized SW Development Costs
3,464
3,448
3,694
3,940
4,299
3,429
3,001
EBITDA
17,054
5,951
11,523
16,397
17,610
7,131
2,971
(10.3%)
(29.5%)
Margin %
23.2%
10.4%
18.4%
23.1%
22.8%
13.0%
6.7%
Adjusted Net Income
(1)
9,499
(1,974)
3,414
9,671
10,891
2,309
(1,011)
16.7%
(163.9%)
Margin %
12.9%
(3.5%)
5.4%
13.6%
14.1%
4.2%
(2.3%)
Adjusted EPS
$0.48
($0.10)
$0.16
$0.45
$0.49
$0.10
($0.04)
11.6%
(162.1%)

CONFIDENTIAL
22
Summary
Financials
-
“Win”
Benchmarking
Case
(Dollars in Thousands)
Review of Newton Financial Projections
Assumes
OA
revenue
of
$61
million
through
March
31,
2010
without
renewal
____________________
(1)
Adjusted Net Income equals EBITDA less depreciation and amortization plus interest income; excludes amortization of deferred compensation.  No taxes due to utilization
of NOLs.
Fiscal Year Ended
Pro Forma
CAGR
CAGR
2005E
2006E
2007E
2008E
2009E
2010E
2010E
'03 -
'05
'05 -
'10
Adjusted Revenue
Related Party
$61,522
$61,305
$61,204
$61,106
$61,106
$15,356
$0
(6.3%)
(100.0%)
Non-Related Party
12,064
16,784
22,573
31,004
37,205
44,646
44,646
8.6%
29.9%
Total Adjusted Revenue
73,586
78,089
83,777
92,110
98,311
60,002
44,646
(4.2%)
(9.5%)
G&A Expenses
NA
16,128
14,736
14,601
15,185
14,016
13,424
Related Party Operating Expenses
NA
22,663
22,256
23,496
24,671
6,476
0
Non-Related Party Operating Expenses
NA
17,355
20,244
23,073
26,787
31,252
31,252
Gross Operating Expense
59,996
56,146
57,236
61,170
66,643
51,744
44,676
0.8%
(5.7%)
% of Total Sales
81.5%
71.9%
68.3%
66.4%
67.8%
86.2%
100.1%
Plus: Capitalized SW Development Costs
3,464
3,448
3,694
3,940
4,293
3,333
2,878
EBITDA
17,054
25,391
30,235
34,880
35,960
11,591
2,848
(10.3%)
(30.1%)
Margin %
23.2%
32.5%
36.1%
37.9%
36.6%
19.3%
6.4%
Adjusted Net Income
(1)
9,499
17,613
22,564
28,881
30,297
8,384
621
16.7%
(42.0%)
Margin %
12.9%
22.6%
26.9%
31.4%
30.8%
14.0%
1.4%
Adjusted EPS
$0.48
$0.86
$1.07
$1.34
$1.36
$0.37
$0.03
11.6%
(43.7%)

Newton Valuation Analysis

CONFIDENTIAL
23
Newton Valuation Analysis
Public Market Overview
____________________
(1)
Last available research dated April 26, 2005.
(2)
Earnings adjusted to include depreciation and amortization.
(2)
($ in mm, except per share data)
Share Price (10/05/05)
$8.52
52-Week High
9.94
52-Week Low
4.76
Market Value
$177.2
Less: Cash & Equivalents
(39.7)
Enterprise Value
$137.6
Revenue
EBITDA
Cash EPS
Wall Street Research
2005E
$73.5
$16.2
$0.48
2006E
NA
NA
NA
Management Base Case
2005E
$73.6
$17.1
$0.48
2006E
62.1
               
10.6
               
0.13
               
Cash
Revenue
EBITDA
P/E
Wall Street Research
2005E
1.9x
8.5x
17.7x
2006E
NA
NA
NA
Management Base Case
2005E
1.9x
8.1x
17.8x
2006E
2.2x
13.0x
65.1x
Enterprise Value /
Newton
Implied Multiples
Financial Summary
(1)
(1)

CONFIDENTIAL
24
____________________
Source:  FactSet and Newton Press Releases.
Newton Stock Price Performance
Newton Valuation Analysis
Last Twelve Months
52-Week-High $9.94
52-Week-Low  $4.76
1/11/05 -
Newton retains Merrill
Lynch to explore strategic
alternatives; VUN retains Lazard
as its financial advisor
4/18/05 -
VUN indicate that based on CSC
report they believe the market competitive
rate for services provided by Newton is
significantly below the current rate
1/26/05 -
Independent consultants
engaged to assess Newton's
offering to Novation
1/9/05 -
Compensation
Committee approved certain
change of control provisions for
the employees of the Company
7/25/05 –
Newton announces
Q2 Financial Results
4/11/05 –
Newton announces
Q1 Financial Results
2/22/05 –
Newton announces
FY 2004 Financial Results
Current
$8.52
Offer Price
$10.00
12/31/04 -
Board of Directors
approved amended and restated
employment agreements
$4.00
$5.00
$6.00
$7.00
$8.00
$9.00
$10.00
$11.00
10/5/04
11/14/04
12/25/04
2/3/05
3/16/05
4/25/05
6/5/05
7/15/05
8/25/05
10/5/05

CONFIDENTIAL
3.6%
29.6%
27.8%
28.5%
10.6%
0
1,000
2,000
3,000
4,000
5,000
6,000
$5.00 - $6.00
$6.00 - $7.00
$7.00 - $8.00
$8.00 - $9.00
$9.00 - $10.00
25
Last Twelve Months
100.0%
89.4%
61.0%
33.2%
3.6%
0
5,000
10,000
15,000
20,000
25,000
<$6.00
<$7.00
<$8.00
<$9.00
<$10.00
Newton Valuation Analysis
Stock
Trading
Analysis
–
Volume
at
Price
per
Share
____________________
Source:  FactSet.
(1)
Shares in thousands.
Cumulative
Volume-Weighted
Average Share Price:
$7.66
Volume
(1)
:
700
5,817
5,446
5,585
2,074
Volume
(1)
:
700
6,517
11,963
17,548
19,622

CONFIDENTIAL
26
Since
Announcement
of
Merrill
Lynch
Retention
-
1/11/05
100.0%
91.9%
71.8%
10.1%
0
2,000
4,000
6,000
8,000
<$6.00
<$7.00
<$8.00
<$9.00
Newton Valuation Analysis
Stock
Trading
Analysis
–
Volume
at
Price
per
Share
(Cont’d)
____________________
Source:  FactSet.
(1)
Shares in thousands.
Since
VUN
13d
Filing
-
4/18/05
Volume-Weighted
Average Share Price:
$7.73
Volume
(1)
:
700
      4,997
                 6,394
         6,955
Volume-Weighted
Average Share Price:
$6.80
Volume
(1)
:
700
5,054
6,937
12,182
13,807
100.0%
88.2%
50.2%
36.6%
5.1%
0
5,000
10,000
15,000
<$6.00
<$7.00
<$8.00
<$9.00
<$10.00

CONFIDENTIAL
27
Newton Valuation Analysis
Valuation Methodology
Comparable Premiums Analysis
Calculated implied value based on the average premium realized in transactions of similar size and at the
average premium paid to minority stockholders in  “squeeze out ”
transactions
Comparable Acquisition Analysis
Calculated implied value based on LTM revenue and LTM EBITDA multiples paid in comparable acquisitions
Calculations
based
on
LTM
2006
EBITDA
discounted
back
to
October
1,
2005
at
13%
Comparable Company Trading Analysis
Calculated implied value based on current revenue and EBITDA trading multiples for comparable companies
Focused on a universe of comparable Healthcare IT companies
Market-based
valuation
metrics
applied
to
Newton’s
projected
2006
Base-Case
results
(reflects
full-year
impact
of potential renegotiation of Outsourcing Agreement)
Discounted Cash Flow Analysis
Calculated
present
value
of
2006
–
2010
annual
cash
flows
and
2010
terminal
value
cash
flow
based
on
a
multiple of 10.0x-12.0x 2010 pro forma EBITDA as of October 1, 2005
Calculated value of future potential tax shields due to NOL utilization from 2011 through assumed expiration
in 2020

CONFIDENTIAL
$5.87
$5.68
$6.98
$7.13
$7.14
$7.03
$7.67
$8.36
$9.42
$3.05
$6.24
$6.53
$8.00
$8.62
$8.88
$9.59
$8.71
$9.76
$11.32
$3.32
$2.00
$5.00
$8.00
$11.00
$14.00
Premium
Analysis
Squeeze Out
Premiums
Public Comparables
Analysis
DCF
Precedent
Transactions
Analysis
Premiums
Paid
Squeeze Out
Premium
2006
Revenue
2006
EBITDA
2006
Revenue
2006
EBITDA
Base
Case
Upside
Case
Downside
Case
"Win"
Benchmarking
28
Summary Valuation
Equity Value per Share
(1)
Newton Valuation Analysis
____________________
(1)
Per share amounts assume 20.8mm fully- diluted shares outstanding, cash of $39.7mm and debt of $0.0mm.
(2)
Share price one day before strategic announcement.
(3)
Represents implied value at October 1, 2005 discounted back at 13%.
5-Year Cash Flows
5-Year Cash Flows
5-Year Cash Flows
5-Year Cash Flows
Range:
20.0% –
40.0%
10.0% –
25.0%
2.0x –
3.0x
12.0x –
16.0x
1.75x –
2.25x
10.0x –
12.0x
WACC 12.0% –
14.0%
WACC 12.0% –
14.0%
WACC 12.0% –
14.0%
WACC 12.0% –
14.0%
10.0x –
12.0x
10.0x –
12.0x
10.0x –
12.0x
10.0x –
12.0x
Metric:
$6.97
(2)
$6.97
(2)
$62.1
$10.6
$62.1
$10.6
EBITDA Multiple
EBITDA Multiple
EBITDA Multiple    
EBITDA Multiple
Current
Price:
$8.52
Offer
Price:
$10.00
(3)
(3)

CONFIDENTIAL
29
Premiums
Paid
Analysis
–
Healthcare
Acquisitions
2002
–
2005
YTD
with
Equity
Offer
Value
between
$100mm
-
$400mm
at
Announcement
Newton Valuation Analysis
____________________
* Excluded from mean and median calculations.
Source:  SDC.
Note:
Newton’s
stock
price
from
1
day
prior
to
announcement
of
exploration
of
strategic
alternatives
used.
Date
Announced
Target Name
Acquiror Name
09/30/05
Specialty Laboratories Inc
AmeriPath Inc
$314.6
1.6%
6.4%
1.7%
07/25/05
BioSource International Inc
Invitrogen Corp
138.2
10.3%
10.8%
18.6%
07/20/05
Guilford Pharmaceuticals Inc
MGI PHARMA Inc
212.1
59.6%
66.7%
42.6%
07/11/05
D&K Healthcare Resources Inc
McKesson Corp
212.2
70.6%
71.4%
75.8%
06/23/05
InKine Pharmaceutical Co
Salix Pharmaceuticals Ltd
188.4
63.6%
63.6%
55.7%
04/29/05
Corixa Corp
GlaxoSmithKline PLC
300.8
47.7%
48.6%
51.7%
04/19/05
Orphan Medical Inc
Jazz Pharmaceuticals Inc
140.6
25.7%
23.3%
14.9%
01/18/05
Impac Medical Systems Inc
Elekta AB
248.2
32.4%
32.4%
32.4%
01/18/05
Cedara Software
Merge Technologies
388.1
0.3%
3.6%
26.2%
12/17/04
Superior Consultant  Holdings
Affiliated Computer Services
104.8
29.2%
35.4%
29.2%
11/04/04
Assisted Living Concepts Inc
Extendicare Health Svcs Inc
128.0
23.7%
32.1%
42.3%
09/22/04
Endocardial Solutions Inc
St Jude Medical Inc
279.6
5.1%
12.3%
44.9%
06/14/04
Prime Medical Services Inc
Healthtronics Surgical Svcs
147.3
18.5%
31.6%
9.7%
06/01/04
ACLARA Biosciences Inc
ViroLogic Inc
180.4
23.9%
27.9%
19.5%
05/13/04
Horizon Medical Products Inc
Rita Medical Systems Inc
158.7
29.5%
9.3%
(7.4%)
03/08/04
Interpore International Inc
Biomet Inc
281.8
17.5%
27.8%
23.9%
11/03/03
Invivo Corp
Intermagnetics General Corp
142.3
34.9%
34.6%
46.5%
08/05/03
CIMA Labs Inc
aaiPharma Inc
366.3
0.0%
(9.7%)
(14.3%)
04/07/03
Bruker AXS Inc
Bruker Daltonics Inc
104.6
44.2%
38.8%
28.3%
02/12/03
Caliper Technologies Corp
Little Bear Investments LLC
114.9
50.0%
56.8%
47.5%
01/16/03
3-Dimensional Pharmaceuticals
Johnson & Johnson Inc
133.9
89.4%
86.4%
88.2%
11/21/02
Synaptic Pharmaceutical Corp
H Lundbeck A/S
121.8
8.3%
62.5%
62.1%
11/14/02
OraPharma Inc
Johnson & Johnson Inc
103.8
2.2%
66.9%
53.4%
10/21/02
Meridian Medical Technologies
King Pharmaceuticals Inc
247.9
16.6%
21.0%
50.9%
03/22/02
SpaceLabs Medical Inc
Instrumentarium Oyj
139.9
(7.8%)
*
(6.9%)
*
9.6%
*
03/20/02
Collateral Therapeutics Inc
Schering AG
158.9
121.0%
*
127.3%
*
164.7%
*
02/27/02
Fusion Medical Technologies
Baxter International Inc
148.9
20.5%
23.6%
33.5%
02/14/02
Oratec Interventions Inc
Smith & Nephew PLC
310.7
40.4%
62.3%
59.2%
02/07/02
Glyko Biomedical Ltd
BioMarin Pharmaceutical Inc
143.3
4.5%
13.4%
0.1%
Mean
28.5%
35.5%
34.7%
Median
23.9%
32.1%
33.5%
Newton
Galileo
$209.1
43.5%
31.6%
29.2%
Equity Value
($mil)
Premium
1 day
prior to
ann. date
Premium
1 week
prior to
ann. date
Premium
4 weeks
prior to
ann. date

CONFIDENTIAL
30
Premiums
Paid
Analysis
–
Internet
&
Software
Acquisitions
2002
–
2005
YTD
with
Equity
Offer
Value
between
$100mm
-
$400mm
at
Announcement
Newton Valuation Analysis
____________________
* Excluded from mean and median calculations.
Source:  SDC.
Date
Announced
Target Name
Acquiror Name
10/03/05
Bindview Development Corp
Symantec Corp
$193.4
14.3%
14.3%
15.6%
08/22/05
Plumtree Software Inc
BEA Systems Inc
205.7
17.8%
27.9%
48.2%
08/18/05
CyberGuard Corp
Secure Computing Corp
289.1
12.2%
13.1%
24.2%
08/03/05
Epiphany Inc
SSA Global Technologies Inc
327.6
7.7%
11.1%
21.4%
06/09/05
Niku Corp
Computer Assoc Intl Inc
350.3
27.3%
33.3%
75.0%
05/09/05
Nuance Communications Inc
ScanSoft Inc
213.8
84.6%
97.5%
114.1%
04/07/05
Concord Communications Inc
Computer Assoc Intl Inc
332.2
71.0%
68.0%
73.3%
01/27/05
MAPICS Inc
Infor Global Solutions
347.2
9.7%
14.2%
24.0%
01/25/05
Corio Inc
IBM Corp
206.2
37.6%
34.3%
51.6%
01/19/05
Selectica Inc
Trilogy Inc
135.0
19.8%
19.8%
22.7%
01/12/05
Verisity Ltd
Cadence Design Systems Inc
302.7
60.2%
57.1%
45.5%
12/01/04
Nassda Corp
Synopsys Inc
210.1
63.6%
60.9%
89.2%
10/04/04
MSC Software Corp
ValueAct Capital Partners LP
273.9
12.6%
16.1%
19.8%
07/16/04
QRS Corp
Investor Group
109.1
29.8%
26.2%
7.7%
07/11/04
Secure Computing Corp
CyberGuard Corp
286.2
22.4%
(27.4%)
(21.3%)
04/29/04
Marimba Inc
BMC Software Inc
238.4
69.4%
64.0%
31.6%
04/29/04
OneSource Information Services
infoUSA Inc
105.1
7.3%
7.9%
7.5%
03/26/04
Switchboard Inc
InfoSpace Inc
160.0
28.1%
23.0%
32.0%
01/28/04
Sanchez Computer Assoc Inc
Fidelity Natl Finl Inc
182.2
16.1%
34.9%
56.6%
10/27/03
On Technology Corp
Symantec Corp
101.1
15.9%
16.3%
57.5%
10/07/03
Concerto Software Inc
Golden Gate Capital
140.9
28.9%
37.3%
25.8%
09/09/03
Lightspan Inc
Plato Learning Inc
108.7
40.9%
34.2%
73.4%
08/06/03
iManage Inc
Interwoven Inc
167.1
23.4%
31.2%
24.4%
08/04/03
Mercator Software Inc
Ascential Software Corp
115.0
22.4%
34.5%
86.3%
07/23/03
Brio Software Inc
Hyperion Solutions Corp
141.9
27.4%
24.2%
50.2%
07/23/03
Pinnacor Inc
MarketWatch.com Inc
100.1
9.0%
8.5%
24.1%
07/16/03
Timberline Software Corp
Best Software Inc
103.5
36.4%
38.0%
38.0%
04/24/03
SpeechWorks International Inc
ScanSoft Inc
166.4
84.6%
85.3%
88.9%
04/03/03
Elite Information Group Inc
Thomson Corp
121.5
40.4%
44.3%
40.7%
02/18/03
Multex.com Inc
Reuters Group PLC
257.3
60.5%
61.2%
57.7%
01/21/03
Caminus Corp
SunGard Data Systems Inc
153.5
260.0%
*
239.6%
*
267.3%
*
Equity Value
($mil)
Premium
1 day
prior to
ann. date
Premium
1 week
prior to
ann. date
Premium
4 weeks
prior to
ann. date

CONFIDENTIAL
31
Premiums
Paid
Analysis
–
Internet
&
Software
Acquisitions
(Cont'd)
2002
–
2005
YTD
with
Equity
Offer
Value
between
$100mm
-
$400mm
at
Announcement
Newton Valuation Analysis
____________________
Source:  SDC.
Note:
Newton’s
stock
price
from
1
day
prior
to
announcement
of
exploration
of
strategic
alternatives
used.
Date
Announced
Target Name
Acquiror Name
12/23/02
Inktomi Corp
Yahoo! Inc
$249.1
41.0%
28.9%
10.7%
12/05/02
Hoovers Inc
Dun & Bradstreet Corp
117.3
32.3%
25.4%
36.2%
10/28/02
Infinium Software Inc
SSI Equity Associates
104.7
20.7%
32.1%
51.2%
06/25/02
Wink Communications Inc
Liberty Broadband Interactive
101.2
7.5%
60.4%
29.9%
04/23/02
Innoveda Inc
Mentor Graphics Corp
175.0
61.2%
67.4%
96.5%
03/18/02
Mechanical Dynamics Inc
MSC Software Corp
127.6
57.0%
31.9%
71.4%
02/20/02
OTG Software Inc
Legato Systems Inc
393.3
17.2%
9.5%
(6.8%)
01/16/02
Centra Software Inc
SmartForce PLC
277.0
16.3%
23.8%
25.6%
01/05/02
Talarian Corp
TIBCO Software Inc
109.6
68.8%
77.3%
112.0%
Mean
33.9%
35.1%
44.4%
Median
27.4%
31.9%
38.0%
Newton
Galileo
$209.1
43.5%
31.6%
29.2%
Equity Value
($mil)
Premium
1 day
prior to
ann. date
Premium
1 week
prior to
ann. date
Premium
4 weeks
prior to
ann. date

CONFIDENTIAL
32
Minority
“Squeeze
Out”
Premiums
Paid
Analysis
Precedent
Transactions:
2002
–
2005
YTD
with
Deal
Values
between
$100mm
-
$400mm
____________________
Source:  SDC.
Newton Valuation Analysis
Premium to
Pre-Announcement Price
Date
Target Name
Acquiror Name
06/27/05
NGC holdings Ltd
Vector Ltd
$349.5
67.2%
1.5%
(2.9%)
05/17/05
Henderson China Holdings Ltd
Henderson Land Dvlp Co Ltd
177.5
70.7%
68.4%
66.7%
04/29/05
Hutchison Global Comm Hldg Ltd
Hutchison Telecommun Intl Ltd
298.3
52.5%
61.4%
49.5%
04/28/05
Sumisho Auto Leasing Corp
Sumitomo Corp
376.2
52.9%
(4.4%)
0.3%
04/20/05
Denny's Japan Co Ltd
Ito-Yokado Co Ltd
313.1
51.6%
5.9%
8.3%
04/18/05
Nippon Broadcasting System
Fuji Television Network Inc
224.8
85.5%
(1.1%)
5.9%
04/01/05
Ports of Auckland
Auckland Regional Holdings
120.2
80.0%
14.3%
24.0%
03/03/05
Siliconix Inc
Vishay Intertechnology Inc
231.0
80.4%
28.9%
36.5%
02/28/05
NEC Soft Ltd
NEC Corp
226.2
82.9%
6.0%
8.0%
02/28/05
NEC System Technologies Ltd
NEC Corp
201.1
81.0%
6.2%
7.9%
02/16/05
Asahi Techno Glass Corp
Asahi Glass Co Ltd
115.3
64.3%
18.0%
28.0%
01/27/05
Genencor International Inc
Danisco A/S
183.8
84.0%
15.8%
23.9%
12/16/04
Konami TYO
Konami Corp
118.4
63.1%
6.4%
5.4%
12/07/04
SRL Inc
Fujirebio Inc
145.2
66.6%
(5.3%)
(2.1%)
12/02/04
NEC System Technologies Ltd
NEC Corp
142.9
66.7%
22.1%
31.7%
12/02/04
NEC Soft Ltd
NEC Corp
264.9
61.6%
21.7%
23.8%
10/25/04
Intier Automotive Inc
Magna International Inc
227.5
86.3%
53.7%
52.2%
10/25/04
Decoma International
Magna International Inc
224.7
74.0%
21.4%
26.9%
10/06/04
Sekiwa Real Estate
Sekisui House
109.0
57.5%
15.0%
14.0%
09/27/04
Tokyu Department Store Co Ltd
Tokyu Corp
164.5
59.2%
(0.7%)
4.5%
08/06/04
Powerco Ltd
Prime Infrastructure Group
205.5
53.6%
0.9%
0.5%
07/27/04
Bank of Asia PCL
UOB
100.9
80.8%
3.9%
2.9%
07/16/04
Algeco SA
TDR Capital LLP
193.0
67.0%
3.4%
7.7%
05/31/04
Centros Comerciales Carrefour
Carrefour SA
174.0
97.2%
2.3%
(5.0%)
05/14/04
Allied Material Corp
Sumitomo Electric Industries
169.0
52.3%
(0.7%)
2.0%
03/23/04
SAP Systems Integration AG
SAP AG
180.3
70.0%
32.6%
33.8%
03/15/04
Abelle Ltd
Harmony Gold Mining Co Ltd
104.3
75.7%
8.1%
11.1%
02/20/04
IDBI Bank Ltd
IDBI
168.4
57.0%
51.7%
52.0%
02/06/04
Entenial SA
Credit Foncier de France SA
204.0
71.5%
(0.7%)
0.3%
01/20/04
Holsten-Brauerei AG
Carlsberg Breweries A/S
310.1
51.0%
55.7%
10.1%
01/15/04
Phosphate Resource Partners LP
IMC Global Inc
110.7
51.6%
16.8%
2.7%
12/18/03
Jonathans Co Ltd
Skylark Co Ltd
159.3
53.6%
2.0%
(3.8%)
12/08/03
Saeco International Group SpA
PAI Partners
291.0
66.9%
2.6%
(1.9%)
11/30/03
Digital GlobalSoft Ltd
Hewlett Packard Leiden BV
309.4
50.0%
62.8%
32.7%
Ownership
Initial
Final
Deal
Value
Deal
Prior to

CONFIDENTIAL
33
Minority
“Squeeze
Out”
Premiums
Paid
Analysis
(Cont'd)
Precedent
Transactions:
2002
–
2005
YTD
with
Deal
Values
between
$100mm
-
$400mm
____________________
Source:  SDC.
Newton Valuation Analysis
Premium to
Pre-Announcement Price
Date
Target Name
Acquiror Name
11/07/03
barnesandnoble.com Inc
Barnes & Noble Inc
$122.4
74.8%
27.1%
35.6%
09/28/03
TCL Commun Equip Share Co Ltd
TCL Corp
371.3
56.7%
100.6%
107.9%
09/03/03
Tamro Oyj
PHOENIX Int'l Beteligungs GmbH
230.9
58.9%
0.9%
4.9%
08/29/03
Cara Operations Ltd
Cara Holdings Ltd
258.2
53.0%
14.3%
17.7%
06/12/03
Generali France Assurance SA
Generali France Holding
243.8
69.0%
3.8%
5.1%
06/02/03
Ribapharm Inc
ICN Pharmaceuticals Inc
187.3
79.6%
50.2%
23.0%
05/23/03
Fidelity Natl Info Solutions
Fidelity Natl Finl Inc
391.9
57.2%
37.3%
24.1%
05/03/03
Top Glory Intl Hldgs Ltd
COFCO(Hong Kong)Ltd
190.7
58.9%
74.1%
72.1%
05/02/03
BBAG Oest Brau-Beteiligungs AG
Heineken NV
376.7
68.7%
62.1%
34.1%
04/25/03
Nippon Steel Chemical Co Ltd
Nippon Steel Corp
114.1
67.6%
(19.9%)
(22.4%)
04/23/03
United Energy Ltd
UED Holdings Ltd
358.6
57.1%
1.6%
1.3%
03/21/03
Hero AG
FIM AG
169.7
74.0%
76.3%
77.7%
01/24/03
Incitec Ltd
Orica Ltd
193.9
80.0%
47.3%
46.3%
11/29/02
Ontex NV
ONV Holdco NV
170.9
78.6%
26.0%
16.5%
11/13/02
Banca Toscana
Banca Monte dei Paschi di
214.0
83.0%
3.1%
14.0%
10/03/02
Cie Financiere Michelin
Michelin SA
175.6
93.5%
9.9%
12.3%
09/18/02
Harvey Nichols Group PLC
Broad Gain(UK)Ltd(Dickson)
105.7
50.1%
49.3%
35.5%
07/26/02
Tremont Corp
Valhi Inc
127.0
64.6%
118.8%
96.4%
07/26/02
International Specialty Prods
Samuel J Heyman
138.0
77.9%
33.8%
4.3%
07/22/02
Cereol
Bunge Ltd
376.7
54.7%
(4.9%)
1.0%
06/19/02
Rautakirja Oy
SanomaWSOY Oyj
153.9
57.0%
13.8%
11.6%
06/05/02
Groupe Zannier
Financiere Zannier
199.3
55.3%
12.1%
8.8%
05/28/02
Gulf Indonesia Resources Ltd
Conoco Canada Resources Ltd
324.6
72.0%
20.1%
23.3%
04/29/02
ConSors Discount Broker AG
BNP Paribas SA
179.2
66.4%
3.2%
1.6%
04/02/02
Nippon Mining & Metals Co Ltd
Japan Energy Corp
305.7
57.6%
(12.7%)
(1.6%)
03/18/02
McAfee.com Corp
Network Associates Inc
229.5
68.5%
(5.1%)
(0.7%)
02/28/02
Aiwa Co Ltd(Sony Corp)
Sony Corp
118.0
61.4%
(3.8%)
(43.0%)
02/05/02
Bahia Sul Celulose SA
Cia Suzano de Papel e Celulose
223.7
73.0%
148.5%
123.5%
01/24/02
Lapeyre(Financiere Poliet)
Cie de Saint-Gobain SA
303.3
74.7%
37.8%
21.3%
01/10/02
Matsushita Seiko
Matsushita Electric Industrial
303.7
57.6%
26.6%
28.8%
Mean
24.2%
20.9%
Median
14.3%
12.0%
Ownership
Initial
Final
Deal
Value
Deal
Prior to

CONFIDENTIAL
34
Comparable Transactions
2002 –
2005 YTD
Newton Valuation Analysis
____________________
* Excluded from mean and median calculations.
Source:  SDC.
(1)
Excludes potential earn out payments.
(1)
Target Name
Acquiror Name
09/29/05
IDX Systems
GE Healthcare
$1,212.4
2.1x
16.0x
08/29/05
NDCHealth
Per-Se Technologies / Wolters Kluwer
965.8
2.5x
10.9x
07/10/05
IMS Health
VNU
6,974.7
4.2x
13.1x
01/18/05
IMPAC Medical Systems
Elekta
190.2
2.7x
23.4x
01/18/05
Cedara Software
Merge Technologies
374.4
7.5x
20.3x
12/17/04
Superior Consultant  Holdings
Affiliated Computer Services
110.3
1.0x
13.6x
11/16/04
VitalWorks (division of AMICAS)
Cerner
100.0
1.4x
NA
07/12/04
ViPS
WebMD
170.9
2.7x
9.3x
12/08/03
PlanVista
Proxymed
104.9
3.2x
10.6x
10/22/03
MediFAX-EDI
WebMD
280.0
4.9x
NA
07/21/03
Practiceworks
Eastman Kodak
489.6
3.6x
18.3x
06/16/03
Advanced Business Fulfillment
WebMD
110.0
1.7x
NA
04/21/03
Synavant
Dendrite International
45.3
0.3x
NM
05/02/02
ALI Technologies
McKesson
295.2
8.5x
*
34.6x
*
Mean
2.9x
15.0x
Median
2.7x
13.6x
Newton
Galileo
$169.5
2.3x
9.8x
Enterprise
Value
($mil)
Enterprise
Value / LTM
Revenue
Enterprise
Value / LTM
EBITDA
Date
Announced

CONFIDENTIAL
35
Publicly Traded Comparables
(Dollars in Millions, Except per Share Data)
____________________
* Excluded from mean and median calculations.
Source:  Wall Street research, company filings, and First Call.
(1)
Based on diluted share count using the treasury stock method.
(2)
Enterprise
Value
=
Market
Value
+
Debt
–
Cash.
(3)
Includes value of public ownership in WebMD Health.
Newton Valuation Analysis
Price on
% of 52 Wk
Market
Enterprise
5-Yr EPS
Company
10/5/05
High
Value
(1)
Value
(2)
Growth
Healthcare IT Comparables
Emdeon
(WebMD)
(3)
$10.69
91.4%
$3,984.3
$3,917.6
3.0x
2.8x
21.9x
18.1x
19.2x
16.2x
20.0%
1.0x
0.8x
Cerner
Corp
82.81
94.6%
3,276.0
3,297.9
2.9x
2.6x
12.6x
10.0x
38.4x
31.2x
25.0%
1.5x
1.2x
Eclipsys
Corp
17.41
83.1%
888.6
780.2
2.1x
1.8x
44.7x
16.3x
NM
29.9x
25.0%
NA
1.2x
Allscripts
Healthcare Solutions *
16.91
88.6%
771.5
719.1
6.0x
*
4.9x
*
43.8x
*
25.7x
*
NM
*
36.1x
*
30.0%
*
NA
*
1.2x
*
Per-Se Technologies
19.70
83.7%
689.1
768.5
2.0x
1.9x
13.4x
11.6x
17.9x
15.4x
17.5%
1.0x
0.9x
TriZetto
Group
14.13
81.5%
621.5
596.3
2.1x
1.9x
12.8x
10.3x
36.9x
26.0x
20.0%
1.8x
1.3x
Omnicell
9.84
69.1%
267.1
239.1
1.9x
1.7x
NM
19.8x
*
NM
31.0x
15.0%
NA
2.1x
ProxyMed
4.88
42.9%
62.0
83.2
0.9x
0.8x
10.1x
6.5x
NM
NM
NA
NA
NA
Mean
2.1x
1.9x
19.3x
12.1x
28.1x
24.9x
20.4%
1.3x
1.3x
Median
2.1x
1.9x
13.1x
11.0x
28.1x
27.9x
20.0%
1.3x
1.2x
Newton -
Street Estimates
$8.52
85.7%
$177.2
$137.6
1.9x
NA
8.5x
NA
17.7x
NA
NA
NA
NA
Newton -
Mgmt Base Case -
At Market
$8.52
85.7%
$177.2
$137.6
1.9x
2.2x
8.1x
13.0x
17.8x
65.1x
(16.4%)
NM
NM
Newton -
Mgmt Base Case -
At Offer
$10.00
100.6%
$209.1
$169.5
2.3x
2.7x
9.9x
16.0x
20.9x
76.5x
(16.4%)
NM
NM
2005E
2006E
2005E
2006E
PEG
Enterprise Value / Revenue
Enterprise Value / EBITDA
P/E
2005E
2006E
2005E
2006E

CONFIDENTIAL
36
Discounted
Cash
Flow
Analysis
–
Base
Case
Newton Valuation Analysis
(Dollars in Millions, Except Per Share Data)
EBITDA Exit Multiple Method
____________________
(1)   
Equity
Value
=
Enterprise
Value
+
Net
Cash
of
$39.7mm
–
Severance
and
other
one-time
costs
of
$3.9mm.
Includes
net
present
value
of
NOLs
of
$2.2mm
(at
mid-point
of
discount range).
+
=
2006
2007
2008
2009
2010
2010 PF
Revenue
$62.1
$67.8
$76.1
$82.3
$74.8
$69.8
   Y-o-Y growth %
(15.6%)
9.2%
12.3%
8.1%
(9.2%)
(6.7%)
EBITDA
$10.6
$16.0
$20.8
$21.9
$13.5
$10.2
   Margin %
17.0%
23.5%
27.3%
26.7%
18.1%
14.6%
Less: Changes in working capital
(1.0)
(0.4)
(0.6)
(0.4)
(0.7)
(0.1)
Less: Capital expenditure
(3.0)
(5.0)
(3.0)
(3.2)
(2.9)
(2.7)
Less: Capitalization of SW Development
(3.4)
(3.7)
(3.9)
(4.3)
(4.4)
(4.2)
Unlevered Free Cash Flow
$3.1
$6.8
$13.3
$14.0
$5.6
$3.1
Free Cash Flow Growth Rate
(73.3%)
121.8%
93.8%
5.6%
(60.4%)
(44.0%)
Fiscal Year Ended
Disc.
PV of Terminal Value at a
Discount
Cash Flows
Multiple of 2010 EBITDA
Enterprise Value
Equity Value
(1)
Value per Share
Rate
(2006-2010)
10.0x
11.0x
12.0x
10.0x
11.0x
12.0x
10.0x
11.0x
12.0x
10.0x
11.0x
12.0x
12.0%
30.6
$56.1
$61.7
$67.3
$86.6
$92.3
$97.9
$124.6
$130.2
$135.8
$5.99
$6.26
$6.53
12.5%
30.2
54.8
60.2
65.7
85.0
90.4
95.9
122.9
128.4
133.8
5.91
6.17
6.43
13.0%
29.8
53.5
58.9
64.2
83.3
88.7
94.0
121.2
126.6
131.9
5.83
6.09
6.34
13.5%
29.4
52.3
57.5
62.7
81.7
86.9
92.2
119.6
124.9
130.1
5.75
6.00
6.25
14.0%
29.1
51.1
56.2
61.3
80.2
85.3
90.4
118.1
123.2
128.3
5.68
5.92
6.17

CONFIDENTIAL
37
Discounted
Cash
Flow
Analysis
–
Upside
Case
Newton Valuation Analysis
(Dollars in Millions, Except Per Share Data)
EBITDA Exit Multiple Method
+
=
____________________
(1)     Equity
Value
=
Enterprise
Value
+
Net
Cash
of
$39.7mm
–
Severance
and
other
one-time
costs
of
$3.9mm.
Includes
net
present
value
of
NOLs
of
$7.6mm
(at
mid-point
of
discount range).
Fiscal Year Ended
2006
2007
2008
2009
2010
Revenue
$62.1
$67.8
$76.1
$82.3
$89.8
   Y-o-Y growth %
(15.6%)
9.2%
12.3%
8.1%
9.0%
EBITDA
$10.6
$16.0
$20.8
$21.9
$23.6
   Margin %
17.0%
23.5%
27.3%
26.7%
26.3%
Less: Changes in working capital
(1.0)
(0.4)
(0.6)
(0.4)
(0.5)
Less: Capital expenditure
(3.0)
(5.0)
(3.0)
(3.2)
(3.5)
Less: Capitalization of SW Development
(3.4)
(3.7)
(3.9)
(4.3)
(4.7)
Unlevered Free Cash Flow
$3.1
$6.8
$13.3
$14.0
$14.9
Free Cash Flow Growth Rate
(73.3%)
121.8%
93.8%
5.6%
6.1%
Disc.
PV of Terminal Value at a
Discount
Cash Flows
Multiple of 2010 EBITDA
Enterprise Value
Equity Value
(1)
Value per Share
Rate
(2006-2010)
10.0x
11.0x
12.0x
10.0x
11.0x
12.0x
10.0x
11.0x
12.0x
10.0x
11.0x
12.0x
12.0%
36.0
$130.1
$143.1
$156.2
$166.2
$179.2
$192.2
$209.5
$222.5
$235.5
$10.07
$10.70
$11.32
12.5%
35.5
127.1
139.8
152.6
162.6
175.4
188.1
206.0
218.7
231.4
9.90
10.51
11.13
13.0%
35.0
124.2
136.6
149.0
159.2
171.6
184.1
202.6
215.0
227.4
9.74
10.34
10.93
13.5%
34.5
121.4
133.5
145.6
155.9
168.0
180.2
199.2
211.4
223.5
9.58
10.16
10.75
14.0%
34.1
118.6
130.4
142.3
152.6
164.5
176.4
196.0
207.8
219.7
9.42
9.99
10.56

CONFIDENTIAL
38
Discounted
Cash
Flow
Analysis
–
Downside
Case
Newton Valuation Analysis
(Dollars in Millions, Except Per Share Data)
____________________
(1)     Equity
Value
=
Enterprise
Value
+
Net
Cash
of
$39.7mm
–
Severance
and
other
one-time
costs
of
$3.9mm.
Includes
net
present
value
of
NOLs
of
$0.0mm
(at
mid-point
of
discount range).
(2)
Pro forma results represent continuing NRP business only.
EBITDA Exit Multiple Method
(2)
+
=
2006
2007
2008
2009
2010
2010 PF
Revenue
$57.1
$62.8
$71.1
$77.3
$54.8
$44.6
   Y-o-Y growth %
(22.4%)
10.0%
13.3%
8.7%
(29.2%)
(18.5%)
EBITDA
$6.0
$11.5
$16.4
$17.6
$7.1
$3.0
   Margin %
10.4%
18.4%
23.1%
22.8%
13.0%
6.7%
Less: Changes in working capital
(1.0)
(0.4)
(0.6)
(0.4)
(1.2)
(0.2)
Less: Capital expenditure
(3.0)
(5.0)
(3.0)
(3.3)
(2.3)
(1.9)
Less: Capitalization of SW Development
(3.4)
(3.7)
(3.9)
(4.3)
(3.4)
(3.0)
Unlevered Free Cash Flow
($1.5)
$2.4
$8.9
$9.7
$0.2
($2.1)
Free Cash Flow Growth Rate
n/a
n/a
268.6%
8.6%
(97.5%)
n/a
Fiscal Year Ended
Disc.
PV of Terminal Value at a
Discount
Cash Flows
Multiple of 2010 EBITDA
Enterprise Value
Equity Value
(1)
Value per Share
Rate
(2006-2010)
10.0x
11.0x
12.0x
10.0x
11.0x
12.0x
10.0x
11.0x
12.0x
10.0x
11.0x
12.0x
12.0%
13.5
$16.4
$18.0
$19.7
$29.9
$31.6
$33.2
$65.7
$67.3
$69.0
$3.16
$3.24
$3.32
12.5%
13.3
16.0
17.6
19.2
29.4
31.0
32.6
65.1
66.7
68.3
3.13
3.21
3.28
13.0%
13.2
15.6
17.2
18.8
28.8
30.4
31.9
64.5
66.1
67.7
3.10
3.18
3.25
13.5%
13.0
15.3
16.8
18.3
28.2
29.8
31.3
64.0
65.5
67.1
3.08
3.15
3.22
14.0%
12.8
14.9
16.4
17.9
27.7
29.2
30.7
63.5
65.0
66.4
3.05
3.12
3.19

CONFIDENTIAL
39
Discounted
Cash
Flow
Analysis
–
“Win”
Benchmarking
Case
Newton Valuation Analysis
(Dollars in Millions, Except Per Share Data)
(2)
+
=
____________________
(1)   
Equity
Value
=
Enterprise
Value
+
Net
Cash
of
$39.7mm
–
Severance
and
other
one-time
costs
of
$3.9mm.
Includes
net
present
value
of
NOLs
of
$0.0mm
(at
mid-point
of
discount range).
(2)
Pro forma results represent continuing NRP business only.
EBITDA Exit Multiple Method
2006
2007
2008
2009
2010
2010 PF
Revenue
$78.1
$83.8
$92.1
$98.3
$60.0
$44.6
   Y-o-Y growth %
6.1%
7.3%
9.9%
6.7%
(39.0%)
(25.6%)
EBITDA
$25.4
$30.2
$34.9
$36.0
$11.6
$2.8
   Margin %
32.5%
36.1%
37.9%
36.6%
19.3%
6.4%
Less: Changes in working capital
(1.0)
(0.4)
(0.5)
(0.4)
(1.2)
(0.3)
Less: Capital expenditure
(3.0)
(5.0)
(3.0)
(3.2)
(2.0)
(1.5)
Less: Capitalization of SW Development
(3.4)
(3.7)
(3.9)
(4.3)
(3.3)
(2.9)
Unlevered Free Cash Flow
$18.0
$21.2
$27.4
$28.1
$5.1
($1.7)
Free Cash Flow Growth Rate
55.1%
17.8%
29.5%
2.5%
(81.9%)
n/a
Fiscal Year Ended
Disc.
PV of Terminal Value at a
Discount
Cash Flows
Multiple of 2010 EBITDA
Enterprise Value
Equity Value
(1)
Value per Share
Rate
(2006-2010)
10.0x
11.0x
12.0x
10.0x
11.0x
12.0x
10.0x
11.0x
12.0x
10.0x
11.0x
12.0x
12.0%
75.2
$15.7
$17.3
$18.8
$90.9
$92.5
$94.1
$126.7
$128.3
$129.8
$6.09
$6.17
$6.24
12.5%
74.4
15.3
16.9
18.4
89.8
91.3
92.8
125.5
127.1
128.6
6.04
6.11
6.18
13.0%
73.6
15.0
16.5
18.0
88.6
90.1
91.6
124.4
125.9
127.4
5.98
6.05
6.12
13.5%
72.9
14.6
16.1
17.6
87.5
89.0
90.4
123.3
124.7
126.2
5.93
6.00
6.07
14.0%
72.1
14.3
15.7
17.2
86.4
87.9
89.3
122.2
123.6
125.0
5.87
5.94
6.01

CONFIDENTIAL
40
Newton Valuation Analysis
Weighted Average Cost of Capital
(Dollars in Millions)
(1) Adjusted betas. Source: The Merrill Lynch Beta Book as of September 2005
(2) Unlevered Beta = (Levered Beta/(1 + ((1 - Tax Rate) * Debt/Equity)).  Assumes Beta of debt equals zero
(3) Unlevered Return = (Estimated Future Risk Free Rate + (Unlevered Beta * Risk Premium))
(4) Levered Cost of Equity = (Estimated Future Risk Free Rate + (Levered Beta * Risk Premium))
(5) WACC = ((Debt/Capitalization * (Cost of Debt * (1 - Tax Rate))) + (Equity/Capitalization * Levered Cost of Equity))
Comparable
Levered
Marginal
Equity
Debt to
Unlevered
Levered
Unlevered
Companies
Beta
(1)
Tax Rate
Debt
Market Value
Equity
Beta
(2)
Return
Return
(3)
Emdeon (WebMD)
1.68
35.0%
$448.4
$3,984.3
11.3%
1.57
16.8%
16.0%
Cerner Corp
0.81
35.0%
154.2
3,276.0
4.7%
0.79
10.4%
10.2%
Eclipsys Corp
1.40
35.0%
0.0
888.6
0.0%
1.40
14.7%
14.7%
Allscripts Healthcare Solutions
1.35
35.0%
82.5
771.5
10.7%
1.26
14.4%
13.7%
Per-Se Technologies
1.00
35.0%
125.6
689.1
18.2%
0.89
11.8%
11.0%
TriZetto Group
1.37
35.0%
29.6
621.5
4.8%
1.33
14.5%
14.2%
Omnicell
1.27
35.0%
0.0
267.1
0.0%
1.27
13.8%
13.8%
ProxyMed
0.97
35.0%
26.2
62.0
42.2%
0.76
11.6%
10.0%
Average
1.23
35.0%
15.3%
1.16
13.5%
13.0%
Newton
1.390
35.0%
0.0
177.1
0.0%
1.39
14.7%
14.7%
Levered Cost of Equity
(4)
Macroeconomic
Unlevered Beta's
Assumptions
Debt/Equity
1.32
1.36
1.39
1.43
1.46
Risk Free Rate (10 year Treasury)
4.4%
0.0%
14.1%
14.4%
14.7%
14.9%
15.2%
Risk Premium
7.4%
10.0%
14.8%
15.1%
15.3%
15.6%
15.9%
Estimated Market Return
11.8%
20.0%
15.4%
15.7%
16.0%
16.3%
16.6%
30.0%
16.1%
16.4%
16.7%
17.0%
17.3%
40.0%
16.7%
17.0%
17.3%
17.7%
18.0%
WACC
(5)
Cost
Unlevered Beta's
   of Debt  
Debt / Equity
1.32
1.36
1.39
1.43
1.46
8.0%
0.0%
14.1%
14.4%
14.7%
14.9%
15.2%
8.5%
10.0%
13.9%
14.2%
14.4%
14.7%
14.9%
9.0%
20.0%
13.8%
14.1%
14.3%
14.6%
14.8%
9.5%
30.0%
13.8%
14.0%
14.2%
14.5%
14.7%
10.0%
40.0%
13.8%
14.0%
14.2%
14.5%
14.7%

Appendix

CONFIDENTIAL
41
Appendix
Review
of
Phase
II
Process
-
Next
Steps
Newton and Voltaire, Urey and Nobel ("VUN" ) will endeavor to achieve the following within one week of agreeing to these
procedures:
Newton will share with VUN a list of the potential buyers it intends to invite into the second round (the "Second Round
List")
VUN will comment as to whether they find any of the potential buyers unacceptable, indicating VUN would not consent
to a transaction with that party. Although VUN will provide to Newton the rationale for excluding such potential buyers,
VUN shall be permitted to find any buyer or buyers unacceptable in their sole and absolute discretion (the Second Round
List, as it may revised to eliminate potential buyers that VUN find unacceptable, is referred to herein as the "Revised
Second Round List")
VUN will share with Newton a list of potential buyers (if any) that they find acceptable, that were not included in the
Second Round List ("Additional Candidates")
Newton will advise VUN as to whether it finds any Additional Candidate unacceptable; any Additional Candidate that
Newton does not find unacceptable shall be included in the Revised Second Round List, and all parties that appear on
such list are referred to herein as “Potential Buyers”
Promptly following agreement as to the composition of the Revised Second Round List, VUN will share with Newton the
term sheet it is developing with CSC (the "Term Sheet"), subject
to the prior execution by Newton of a customary
confidentiality agreement to be provided by VUN (the " Confidentiality Agreement")
Newton, on VUN's behalf, will forward the Term Sheet to the Potential Buyers, subject, in each case, to the prior execution
of the Confidentiality Agreement
For purposes of these procedures:  “representatives”
of any party shall include legal, financial and other advisors;
references to
VUN shall include their respective representatives; and references to Newton shall include its representatives and any separate
representatives of the independent committee of its Board of Directors.

CONFIDENTIAL
42
Appendix
Review
of
Phase
II
Process
-
Diligence
Promptly after forwarding the Term Sheet to Potential Buyers, Newton and VUN will arrange meetings, which they will
endeavor to have occur within one to two weeks of the Term Sheet
distribution, with the Potential Buyers for the purposes of
permitting both VUN and the Potential Buyers to conduct due diligence. During these sessions the Potential Buyers will have
the opportunity to discuss the Term Sheet, VUN's expectations related to a renegotiation of the Outsourcing Agreement (“OA”)
and conduct other customary diligence. In addition, these sessions will allow the Potential Buyers to discuss their e-commerce
capabilities, and allow VUN to evaluate each Potential Buyer's acceptability as a potential e-commerce partner. Over the next
few weeks, Newton and VUN will attempt to come to an agreement regarding the proposed agenda for and the primary
participants from VUN at these meetings.
These meetings will be governed by the following guidelines:
A representative from Newton and/or Merrill Lynch will be present at all discussions between the Potential Buyers and
VUN. VUN and each Potential Buyer will agree not to have any substantive contact related to this process outside of the
scheduled diligence session
VUN will not discuss with any Potential Buyer VUN's or such Potential Buyer's view as to an appropriate valuation for
Newton

CONFIDENTIAL
43
Appendix
Review
of
Phase
II
Process
-
Bidding
Process
Following
these
diligence
sessions,
the
Potential
Buyers
will
be
provided
an
instruction
letter
which
will
detail
the
specific
requirements of their bid and a form definitive agreement. The terms of such documents shall be subject to the prior review
and approval of VUN, which will not be unreasonably withheld or delayed, it being understood that Newton may redact from
such
documents
all
references
to
a
proposed
purchase
price
(the
"Purchase
Price")
for
Newton.
Based on all diligence performed to date, the Term Sheet and the
meetings with VUN as detailed above, the Potential Buyers
will be asked to submit a formal bid for the acquisition of Newton (the "Proposal"). The Proposal will include, among other
things,
(i)
the
Purchase
Price,
(ii)
a
mark-up
of
the
definitive
agreement
and
(iii)
a
mark-up
of
the
Term
Sheet.
Newton
will
share
with
VUN
the
Term
Sheet
mark-ups
submitted
by
each
of
the
Potential
Buyers.
VUN
shall
indicate
to
Newton,
after
having
reviewed
such
mark-ups,
which
of
the
Potential
Buyers
they
still
find
acceptable
and
provide
reasons
to
Newton why any Potential Buyer is not acceptable to VUN.  VUN shall promptly thereafter have discussions with each of the
acceptable Potential Buyers to review, clarify, and, if appropriate, negotiate and revise, such Term Sheet mark-ups.  A
representative from Newton and/or Merrill Lynch will be present at all discussions.  Promptly following the conclusion of
such discussions, VUN will notify Newton as to which of the Potential Buyers remain acceptable and provide reasons to
Newton why any Potential Buyer is not acceptable to VUN.  Newton
will notify VUN as to those remaining Potential Buyers
with
which
it
intends
to
engage
in
further
negotiation
(the
"Bidders").

CONFIDENTIAL
44
Appendix
Review
of
Phase
II
Process
-
Negotiation
Process
Newton and its representatives will have responsibility for negotiating all components of each Bidder's Proposal.  However,
representatives from VUN and/or Lazard will be present at all discussions between the Bidders and Newton, other than with
respect to the Purchase Price.  During such discussions, representatives from VUN and/or Lazard will not comment to the
Bidder on issues being discussed unless requested to do so by Newton.  Except with respect to the Purchase Price, Newton and
each Bidder will agree to not have any substantive contact related to this process outside of the presence of representatives
from VUN and/or Lazard.

CONFIDENTIAL
45
Appendix
Review
of
Phase
II
Process
-
Final
Negotiation
At the conclusion of this process, Newton and VUN will meet to discuss the Bidder with which to move forward (the
"Preferred Party"). To the extent that Newton and VUN are not in
agreement on the party with which to move forward, Merrill
Lynch and Lazard will jointly develop a strategy to facilitate further negotiation with the Bidders in an effort to build
consensus around one Preferred Party or multiple Preferred Parties. 
Once designated, the Preferred Party will begin final negotiation of the definitive purchase agreement with Newton while
simultaneously engaging in drafting and negotiating the amended OA with VUN. VUN will continue to be involved in the
negotiation of all aspects of the definitive agreement, other than Purchase Price. All parties shall use reasonable efforts to move
as quickly as possible to reach full negotiation of all aspects of the transaction.  It is understood and agreed, however, that no
party is under any obligation to agree to a Preferred Party or to enter into a transaction, and that by participating in the process
described herein no party is waiving any rights it may otherwise
have.