SNDV Soundview Technology Grp. (MM)

Charles Schwab and SoundView Technology Announce Strategic Alliance With Perseus Group Alliance Will Enable Planned Schwab SoundView Capital Markets Business To Provide Institutional Investors With Access to Equity Offerings JERSEY CITY, N.J., OLD GREENWICH, Conn. and SAN FRANCISCO, Dec. 3 /PRNewswire-FirstCall/ -- The Charles Schwab Corporation , ("Schwab"), and SoundView Technology Group, Inc. , ("SoundView") today announced a strategic alliance with Perseus Group ("Perseus"), an independent investment bank, which will allow the planned Schwab SoundView Capital Markets business to offer its institutional clients access to public equity offerings in industries including technology, healthcare, consumer, media, and communications. The Perseus alliance will take effect upon formation of Schwab SoundView, and is subject to regulatory approval. The alliance with Perseus follows the definitive agreement announced on November 19th, under which Schwab has agreed to acquire SoundView. Upon completion of the proposed transaction, Schwab and SoundView's institutional securities businesses will be combined to form Schwab SoundView Capital Markets ("Schwab SoundView"), which will offer asset managers a full range of equity research and trade execution services. As announced previously, SoundView will exit its investment banking unit in conjunction with the purchase by Schwab. "For growth-oriented institutional investors, access to high-quality new issues is an important service that we intend to deliver in a new way, without traditional investment banking conflicts," said Lon Gorman, Schwab Vice Chairman and head of Schwab Institutional and Asset Management. "We will work only for the institutional investor, receiving absolutely no financial reward from investment banking. Our economic incentive in distributing deals only comes from our clients believing we are doing a good job in making appropriate investments available to them, thereby building client loyalty." Overview of the Alliance The alliance of Schwab SoundView with Perseus is a distribution arrangement with three key features: 1. Perseus provides investment banking services. Perseus serves as the underwriter and advisor to the issuing company on transaction structure, timing, valuation and other issuer-specific items. Perseus retains 100% of all underwriting fees and does not provide research, trading and other services to investors. 2. Schwab SoundView provides distribution. Schwab SoundView will review all offerings proposed by Perseus and only offer to its institutional investor clients those deals that it believes are appropriate. Since Schwab SoundView receives no underwriting fees or other economic consideration, it has no incentive to distribute offerings that are not suitable investments for its institutional clients. 3. An alliance free from traditional conflicts. Schwab SoundView will have no ownership stake or other interest in Perseus. Schwab SoundView and its employees will not receive underwriting fees, corporate finance fees, selling concessions, expense recoveries or other compensation associated with underwriting transactions. Schwab SoundView will have no obligation to publish any research on, nor will Schwab SoundView research analysts have any obligation to follow, any of the companies involved in these offerings. Instead, Schwab SoundView research coverage results solely from institutional client demand for differentiated insight into exciting companies with solid growth prospects. Additionally, neither Schwab SoundView nor its research analysts will receive any direct compensation for providing research coverage on companies underwritten by Perseus. Perseus Group was established earlier this year by a group of highly experienced professionals formerly associated with Wall Street's leading investment banks to focus on growth sectors of the economy. The firm provides a full range of investment banking services including mergers and acquisitions and capital raising, and provides senior-level strategic advice to corporate clients, venture capital and private equity firms. Managing Directors of Perseus Group have collectively advised clients on over $1 trillion of underwriting and strategic advisory transactions. "Perseus Group is excited to enter into this ground-breaking alliance. Our focus on growth-oriented industries will give Schwab clients access to new issues," said Todd Carter, president and chief executive of Perseus Group. "Since Perseus will not offer equity research, sales or trading, the Schwab SoundView alliance provides us with an important capability that complements our existing mergers and acquisitions, capital raising and other corporate finance advisory services. We believe this model for further separating investment banking from research will bring greater integrity to the capital raising process." "As we stated when we announced our intention to create Schwab SoundView Capital Markets, we are exiting investment banking and focusing our brand on independent research and trading. But knowing how important new issues are to institutional investors, we are pleased to create the alliance with Perseus," commented Mark Loehr, CEO of SoundView. "Since we will receive no investment banking revenue from our clients' investments in Perseus' offerings, Schwab SoundView will be 100% aligned with our investing clients." About Charles Schwab The Charles Schwab Corporation, through Charles Schwab & Co., Inc. (member SIPC/NYSE), U.S. Trust Corporation, CyberTrader, Inc. (member SIPC/NASD) and its other operating subsidiaries, provides a broad range of financial and brokerage services to individual investors, independent investment managers and institutions. http://www.schwab.com/. About SoundView Technology Group, Inc. SoundView Technology Group, Inc. is the parent of SoundView Technology Corporation, a research-driven securities firm focused on providing institutional investors with fundamental research on companies in technology, media, telecom, healthcare and other growth-related industries. Old Greenwich, Connecticut-based SoundView produces comprehensive sell-side equity research on approximately 210 companies. On November 19, 2003, SoundView announced an agreement to be acquired by The Charles Schwab Corporation. For more information, please see http://www.soundview.com/. About Perseus Group Perseus Group provides a full range of investment banking services to companies across a broad range of industries including Technology, Healthcare, Media, Communications, Business Services, Consumer and Financial Services. The management team consists of senior professionals formerly associated with many of Wall Street's leading investment banks. Founded in 2003, Perseus Group is an employee-owned firm with a minority investment by Perseus LLC, a Washington, DC based private equity fund management company. All investment banking and securities services are performed by Perseus Advisors LLC, a subsidiary of Perseus Group and an NASD member firm. For more information, please see http://www.perseusgroup.com/. Forward Looking Statements This release includes forward looking statements relating to the acquisition of SoundView Technology Group, Inc. which are indicated by the words "will," "expect," "believe" and similar expressions. These forward-looking statements are necessarily current estimates based on the best judgment of Schwab's and SoundView's senior management. Achievement of the expressed goals, expectations and objectives is subject to risks and uncertainties that could cause actual results to differ materially from those goals, objectives or expectations. Important factors that may cause such differences include, but are not limited to, changes in the demand for and pricing of institutional equity research and trade execution services, the effect of changes in competitors' offerings, and Schwab's success in integrating this acquisition. DATASOURCE: The Charles Schwab Corporation CONTACT: Rich Fowler, +1-415-636-9869 (investors), or Jennifer Hallahan, +1-212-804-3668 (media), for Schwab; or Robin Weinberg, +1-201-499-3567, for SoundView;, or Steve Lipin of Brunswick Group, +1-212-333-3810, for Perseus Web site: http://www.schwab.com/

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