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Your Gateway to Bandwidth

Investor Presentation May 2009. Your Gateway to Bandwidth. Forward-looking statements.

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Your Gateway to Bandwidth

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  1. Investor Presentation May 2009 Your Gateway to Bandwidth

  2. Forward-looking statements • Certain statements in this presentation may constitute forward-looking statements which involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. When used in this presentation, such statements are generally identified by the use of such words as "may", "will", "expect", "believe", "plan", "intend" and other similar terminology. These statements reflect Vecima's current expectations regarding future events and operating performance and speak only as of the date of this presentation. Forward-looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such results will be achieved. A number of factors including, but not limited to, the factors discussed under "Risk Factors" in the Company's Annual Information Form dated September 25, 2007 available on SEDAR (www.sedar.com), could cause actual results to differ materially from the results discussed in the forward-looking statements. Although the forward-looking statements contained in this presentation are based upon what management of the Company believes are reasonable assumptions, the Company cannot assure investors that actual results will be consistent with these forward-looking statements.These forward-looking statements are made as of the date of this presentation, and the Company assumes no obligation to update or revise them to reflect new events or circumstances. 2

  3. What is bandwidth? • 1bit= • 0/1 • a rate of transfer measured in bits per second

  4. 1 mbps 56 kbps 5 mbps 15 mbps 1988 1998 2003 2008 The rise of bandwidth Facebook File Sharing You Tube VOIP VOD Skype Gaming PVR Data over Cable HDTV Digital TV Analog TV Analog Digital Interactive Personalized Content

  5. It’s all about bandwidth • Insatiable demand • Finite capacity • Legacy equipment and infrastructurelimitaccess to greater bandwidth • Users wantmoreservices,morechoice andmorespeed. 5

  6. Long-term solution Install Fiber Optic Networks Meeting the demand • Short-term solution • Maximize Existing Network • Prohibitively expensive • Infrastructure disruption • Offers substantial bandwidth expansion • Cost effective • Utilizes in place infrastructure • Requires bandwidth maximization through equipment “upgrades” Verizon alone to pump $20 billion in to FiOS by 2010 6

  7. Gateway to bandwidth

  8. What we do • Vecima productizes superior technology enabling access to more bandwidth by maximizing the capacity potential of current network infrastructure

  9. What we do • Radio Frequency • Digital Signal Processing • Embedded Software 9

  10. Accessing bandwidth • Vecima improves access to bandwidth by: • Replacing analog signals with digital in portions of the network • Efficiently managing digital signals before they reach the end user • Using wireless technology where there is no network infrastructure 10

  11. Replacing analog with digital • 8 • 0 • 0 • digital signals can fit into the bandwidth taken up by 80 analog channels

  12. Replacing analog with digital • 800 • analog + digital • digital • cable capacity • 80 • throughput • throughput 12

  13. Replacing analog with digital • Mix of analog + digital signal – network capacity • digital signal – network capacity • cable cross sectionanalog and digital signal • cable cross sectionanalog and digital signal 13

  14. Efficiently managing digital signals • Non-switched video, all houses receive call channels • Switched digital video only delivers the signals being watched freeing up bandwidth for other uses

  15. Network equipmentVecima Extending the network with wireless • Head end • wireless • node • curb • core network • premises • distributed network • Wire/fiber 15

  16. Gateway to success

  17. Proven and competent • Superior, long-standing RF DSP expertise • Leading edge proprietary technology • Unmatched order-to-market development speed • Proven growth management 17

  18. Fully integrated design-production-marketing • 167 engineers on staff (90 hardware, 77 software. 23% of total staff focused on R&D) • Design • Develop • Manufacture • Sell • Specific expertise and flexible approach yields short development timelines • Multi line, MSO-approved facility in Saskatoon, Saskatchewan • Direct sales • OEM relationships • Distribution channels • Business development 18

  19. Customer-focused innovation • Long-term relationships with key customers are generating a steady stream of new opportunities • Focus on products, not technology • One stop shop for customers • Collaborative approach to solving customer challenges • Full integration permits rapid order-to-market 19

  20. Gateway to growth

  21. 6 • 0 • % • of data over cable globally flows through our products • OEM • MSO • Cisco • Motorola • Big Band • Huawei • Time Warner • Comcast • Cox • Charter • Cablevision

  22. Growth strategy • Expand number and size of OEM and MSO relationships • Leverage bandwidth reclamation and emerging digital technologies (DOCSIS 3.0) opportunities • Target wireless opportunities associated with broader fixed WiMAX adoption • Selectively acquire complementary products/expertise • Maximize value of and monetize non-core assets • Commercial applications for software defined radio 22

  23. Multiple growth opportunities • Converged wired • Wireless • Analog reclamation • Digital simulcast • Deep digital (multi-unit buildings) • Next generation digital • DOCSIS 3.0 and beyond (own products and OEM modules) • Video on demand / switched digital video / HDTV • WiMAX • Spectrum Signal Processing– Commercial SDR 23

  24. Analog Reclamation approximately Size of market $1.5B globally Business segment Converged wired Key products CableVista, MDU-DTA Current penetration Vecima products widely deployed • MSOs need to reclaim bandwidth and operate digitally in core network • Analog conversion for multiple dwelling units • Digital conversion February 2009 Drivers/milestones for growth 24

  25. Next generation digital 2008 2011 Size of market $860M $ 1 .4B Business segment Converged wired Key products HyperQAM, EdgeQAM, OEM Modules Current penetration Early-stage sales coming online • Increased implementation by leading MSOs • Rollout in other countries • Growing demand for HDTV and interactive services Drivers/milestones for growth 25

  26. Wireless 2007 2011 Size of market $800M $ 7 .7B Business segment Wireless Key products VistaMAX, commercial SDR Current penetration Pilot scale • Growing demand for services, even on remote /emerging areas • WiMAX Forum Wave 2 Certification • Results of pilot testing • Conclude first full-scale deployment Drivers/milestones for growth 26

  27. Recent Highlights – Progress Against Strategy • SSP partners with Live TV LLC for next generation radios to support in-flight e-mail (Q1 09) • Signed agreement with Cisco to supply a next generation upconverter module for use in CMTS products (Q4 08) • Launched 3.65 GHz WiMAX solution for US (Q4 08) • Signed supply agreement with U.S. Cable MSO to support conversion to all digital network (Q4 08) • Entered into co-branding agreement with Motorola on CableVista Edge Decoder product (Q3 08) 27

  28. Gateway to value

  29. Strategic assets • 855 licenses • Avg. cost $1,500 • B.C., AB, Ottawa, rural Ont. • More than $4B in licenses recently auctioned by Cdn. government Commercial spectrum Your Link Real estate • Wholly-owned sub • 7 cable TV service providers in BC, and ISP in Sask. • Recurring revenue • “Test bed” for new products • Approximately $35 million 29

  30. Reported business segments • Products for digital video and data over cable • A range of services including:broadcast digital video • Switched digital video • HDTV broadcast • Video on demand • DOCSIS data services Converged wired Wireless Your Link • Broadband wireless products • WiMAX • Spectrum signal processing – software defined radios • Wholly-owned sub • 7 cable TV service providers in BC • Broadband video and ISP in Saskatchewan • Recurring revenue • “Test Bed” for new products 30

  31. Strong track record • Net Income Fiscal years ended June 30 C$ millions Fiscal years ended June 30 C$ millions • Revenue • CAGR 30% • (41% on a US$ basis) 120.6 15.5 93.7 80.0 11.9 63.0 10.3 10.6 9.5 2.1 44.3 6.6 32.1 2.8 2003 2004 2005 2006 2007 2008 2003 2004 2005 2006 2007 2008 Extraordinary Earnings 31

  32. Vecima has transitioned to report revenues broken down into three overall market segments: Financial review – business segments • 2008 Your Link 7 14 Broadband Wireless • Converged Wired Solution • Broadband Wireless • YourLink (service provision) Converged wired 79 • 2007 Your Link 8 Broadband Wireless In fiscal 2008, the Company focused on near-term opportunities in its converged wired business and reduced production of wireless products. 27 Converged wired 65 Fiscal years ended June 30 32

  33. Two-year financial summary Selected Quarterly Consolidated Financial Information and Other Data (in thousands of dollars except for net income per share data) 33

  34. Solid balance sheet 1 Based on share outstanding at end of period 2Some numbers have been restated 34

  35. Management team 35

  36. Board of directors 36

  37. Investment highlights • Industry-leading technological expertise • Fully integrated, customer-focused operations • Growing, diverse blue-chip customer base • Multiple significant growth opportunities • Powerful operational and financial discipline • ~30% CAGR in revenue over the last five years • 20 consecutive years of profitability • Focused growth strategy • Strong management team 37

  38. Market data 38

  39. Investor Presentation May 2009 Your Gateway to Bandwidth

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