Exhibit 99.2 Description of slides regarding McLeodUSA's proposed acquisition
of Splitrock.
Slide 01
Large McLeodUSA logo and Splitrock logo
Slide 02
McLeodUSA. . .
Presentation
Clark McLeod
Lyle Patrick
Q & A
Steve Gray
Roy Wilkens
Bill Wilson
McLeodUSA logo . . .conference participants
Slide 03
A Great Deal. . .
Consideration
Stock 34M (shares)*
Fixed Exchange Ratio ($30-31)
Debt (net) $150M
Enterprise value 2.1B
Key Terms
No Cap or Collar Provisions
Voting Agreement (55% shares)
3-year Shareholder Agreement
Purchase Accounting
Expected Close - 2Q00
*13% Fully Diluted
McLeodUSA logo . . .accelerating data rollout
Slide 04
McLeodUSA. . . .
[Below this text Local Business Lines, and on the left side of the slide appears
a map of the continental United States, showing the 48 states therein. The two
letter postal state abbreviation symbols "WA," "OR," "ID," "MT," "WY," "UT,"
"AZ," "NM," "CO," "KS," "NE," "SD," "ND," "MN," "WI," "IA," "MO," "IL," "IN,"
"OH," "MI," appear in bold type within the respective boundaries of the state
which each symbol represents. The following numerical percentages appear within
the following states: Michigan "8%," Illinois "31%," Wisconsin "14%," Minnesota
"19%," Iowa "43%," Nebraska "1%," South Dakota "30%," North Dakota "26%,"
Wyoming `25%," Colorado "12%,". Stars and numerical percentages associated
therewith are located in the states of Indiana "7%" and Missouri "37%". The
following years appear within the following states: Ohio 2001, Kansas 2000, New
Mexico 2000, Arizona 2000, Utah 2000, Oregon 2000, Washington 2000, Idaho 2000
and Montana 2000. Below the map on the left side appears a legend showing a
star with the text "Springfield, MO" and "Indianapolis, IN" to its right. Below
the map on the left side appears text "Excludes Tier 1 Markets". Beside the
map on the right side text is listed with bullet points: High Marketshare Lowest
Attrition, 10,000 Mile Network, Best Systems Customer & Network, Brand - 24M
Directories]
McLeodUSA logo . . .great plan, great execution
Slide 05
McLeodUSA.......
Employees [arrow pointing right] 8,000(E)
Geography [arrow pointing right] 21 States
Product [arrow pointing right] Voice(Local/LD), Data, Directories
Customer [arrow pointing right] 670,000(E) Local Lines
Network [arrow pointing right] 10,000(E) Inter/Intra Route Miles
Revenue [arrow pointing right] $1 Billion of Revenue*
EBITDA [arrow pointing right] Positive for 8 Quarters
*4Q(E) Annualized
McLeodUSA logo . . .explosive growth
Slide 06
M&A, Experienced, Successful. . .
[Merger and Acquisition timeline diagram, starting with the year 1996 continuing
until 2000 and showing corporate logos of business acquired or, in the case of
Splitrock, proposed to be
acquired. Telecom*USA Publishing Company is shown in 1996, Consolidated
Communications was is shown in 1997, Dakota Telecommunications Group is shown in
1998, Ovation Communications is shown in 1999, Access is shown in 1999,
Splitrock is shown in 2000.]
McLeodUSA logo . . .integrating, leveraging people and assets
Slide 07
SPLITROCK Next Generation. . .
[Centered in the slide is a diagram of the 48 continental United States and
Alaska and Hawaii. Above the diagram is a legend showing ATM POPs - 350.
Inside the Diagram are sporadic dots showing the 350 ATM POPs. Beside the
diagram is text listed with bullet points: 90% U.S. Coverage 800 Cities, ATM-to-
the-Edge/TM/ All Products All Locations, Peering.]
McLeodUSA logo . . .data connections company
Slide 08
SplitRock.......
Employees [arrow pointing right] 420
Geography [arrow pointing right] 50 States
Product [arrow pointing right] Dial, Dedicated Data
Customers [arrow pointing right] Prodigy, InfiNeT, Exodus, Juno, Focal, Enhanced Wholesale
Network [arrow pointing right] Leased, Plus Level 3 IRU
Revenue [arrow pointing right] $95M of Revenue*
EBITDA [arrow pointing right] ($48M)*
*3Q Annualized
McLeodUSA logo . . .focused on network deployment
Slide 09
Incredible Growth Today. . .
[Two graphs appear below this text. The heading on the graph on the left is
"U.S. Revenue." The heading on the graph on the right is "U.S. Bandwidth." The
U.S. Revenue graph shows, for the years 1990 to beyond 2005, actual and
projected U.S. revenues from combined data and voice communications of about
$110 billion in 1990, $170 billion in 1995, $300 billion in 2000, $500 billion
in 2005, and over $700 billion before 2010, while U.S. revenues for voice
communications above is shown as about $90 billion in 1990, $110 billion in
1995, $160 in 2000, $260 billion in 2005 and over $300 billion in 2010. The
U.S. Bandwidth graph shows, from 1990 to beyond 2005, actual and projected
growth of bandwidth for voice communications increasing from about 1/2x in
1990 to nearly 1x before 2010 while the combined growth of bandwidth for voice
and data shown as about 1/2x in 1990, 3/4x in 1995, 1 3/4x in 200 and over 5x
before 2005. Underneath the two graphs is the text $300 Billion Voice + $300
Billion Data.]
McLeodUSA logo . . .explosive future growth
Slide 10
Drivers to Growth. . .
. People
. Time to Market
. Assets
. 350 ATM POPs
. Peering
. 16,000 Mile Network
. Systems
McLeodUSA logo . . .keys to the opportunity
Slide 11
Experienced and Focused. . .
[Organizational chart listing the Chief Executive Office. In the first row in
one box is Clark McLeod with his title as Chairman & CEO of McLeodUSA
Incorporated his Focus: External. In the second row are two boxes the first is
Steve Gray with his title Pres/CEO CLEC Focus: Regional/Retail. The second box
lists Roy Wilkens with his title of Pres/CEO Data Focus: National/Data.]
McLeodUSA logo . . .the formula for execution
Slide 12
Roy Wilkens. . .
. President/CEO McLeodUSA Data - January 2000
. Founder/CEO WilTel 1985-1997
. Completed first transcontinental fiber build
. Largest and most respected wholesaler
. Premier data company in the United States (first nationwide frame relay
service)
. Acquired by WorldCom 1995 (CEO WilTel and Vice Chairman WorldCom 1995-97)
. Appointments
. National Security Telecommunications Advisory Council (both President Bush
and President Clinton)
. Past chairman of Comptel
. TRA voted Wilkens most influential person (Telecom, last 15 years)
McLeodUSA logo . . .a leader in telecommunications
Slide 13
Data Architecture. . .
. IP Dial/Dedicated
. Private Line
. ATM
. Frame Relay
. Voice
. Optical Wave
. Web Hosting
McLeodUSA logo . . .ATM-to-the-Edge/TM/
Slide 14
Metcalfe's + Moore's + McLeod's Laws. . .
[Pictured are three bar graphs. Up the left side are the words Different Call
Combinations with the numbers 30,000 and 60,000. Along the bottom is the title
#ATM POPs (ATMP) with the amounts of 50, 100, and 350. The bar reaches 1,225
above 50, 4,950 above 100, and 61,075 above 350. Above the bar is the following
equation: McLeod's Law = ((ATMP - 1) x (ATMP)) divided by 2. Beside the graph
on the right is a bullet point with the text More city pair combinations on-
net.]
McLeodUSA logo . . .SPLITROCK, rare and valuable asset
Slide 15
Network Combination. . .
[Centered on the slide is a diagram of the continental United Sates. In dark
print are lines connecting McLeodUSA's current switch and fiber routes along
with current switch sites. In light print are lines of Splitrock's current
fiber route, core sites, hub sites and network centers. To the right of the
diagram is a key listing a light star as McLeodUSA's current switch site, a dark
star listing McLeodUSA's future switch site, and a dark line listing the fiber
route. Below the McLeodUSA key is a key for Splitrock listing light triangle
for Core sites, a light circle for hub sites, a light line for fiber route, and
a light triangle with a circle around it for the network center. Below this
diagram is the text illustration only. Above the diagram is text 26,000 Fiber
Miles.]
McLeodUSA logo . . .a perfect fit
Slide 16
Great Today. . .
Today
Advance ATM-to-the-Edge/TM/
Most Pervasive
Robust Provisioning & Operating Systems
1Q2001
26,000 Miles of Fiber
SPLT + MCLD/WilTel System Integration
McLeodUSA logo . . .awesome tomorrow
Slide 17
Benefit of McLeodUSA and Splitrock. . .
In-Region Customer - Retail (arrow up) Rev. (arrow down) Cost
More Data Products, ATM-to-the Edge/TM/ X X
More Customer Types (S,M,L) X X
Product Use Out-of-Region, Travel X X
Out-of-Region Termination, Data & Voice X
Out-of-Region Customers - National Data
1st, 2nd, 3rd Tier Coverage - 90% USA X X
All Products, 800 Cities X X
McLeodUSA logo . . .both top and bottom line
Slide 18
Lyle Patrick
Chief Financial Officer
McLeodUSA logo
Slide 19
Proforma Combination Scenarios. . .
[Two graphs appear below. The heading of the graph on the left is "Revenue."
The heading on the graph to the right is "EBITDA." The graphs show for a ten
year period the amounts, that McLeodUSA revenue and EBITDA, and then combined
McLeodUSA and Splitrock revenue and EBITDA, are projected to increase. The
Revenue graph shows McLeodUSA growing from about $1.2 Billion in year 0 to $4.5
Billion in year 5 and $12 Billion in year 10, while the combined McLeodUSA and
Splitrock revenues are shown as about $1.4 Billion in year 0, $5.5 Billion in
year 5 and $14 Billion in year 10. The EBITDA graph shows McLeodUSA growing
from about $0.1 Billion in year 0 to $1.4 Billion in year 5 and $4.8 Billion in
year 10, while the combined McLeodUSA and Splitrock EBITDA are about $0.1
Billion in year 0, $1.7 Billion in year 5, and $5.6 Billion in year 10. Below
the graphs on the left side of the slide is the text "Salomon/Smith Barney".]
McLeodUSA logo . . .current estimates, pre-synergies
Slide 20
Adding Value. . .
Synergy Opportunity
Regional Data up 35%
Voice/Data O&T On-Net
Regional Capex
Execution Step Up
People Focus
Addressable Market
McLeodUSA logo . . .accelerating data opportunity
Slide 21
McLeodUSA Opportunity. . .
Total Telecom Revenue 2009
$600 Billion
In-Region, 21 State $120B
Out-of-Region wholesale
National Data Opportunity $240B
-----
MCLD Addressable Market $360B
McLeodUSA logo . . .tripling in size
Slide 22
Capital Uses. . .
[Two pie graphs appear. The one on the left is Sources, the one on the right is
Uses for the years 2000-2002. The Sources chart on the left is $2.5 Billion
divided between four different sections. Forstmann Little represents $1
Billion, $900M is Add'l Funding, $400M is Cash, and $200M is Operating Capital*.
The footnote beneath the graph indicates: *EBITDA Net of Interest & Working
Capital. The Uses graph on the right is $2.5 Billion is divided into four
different sections. 16 States require $1.4 Billion, $500M is for SPLT, $400M
is for Western States, and $200M is for Ohio.]
McLeodUSA logo . . .100% plant and equipment
Slide 23
Stock Price Exchange Ratio. . .
[Two line graphs appear. One listing the Splitrock Daily Closing price:
08/02/99 Through 01/06/00. Numbers, shown as prices, up the left side are even
numbers showing "10," "12," "14," "16," "18," "20," "22," "24," "26". Along the
bottom line are the months "Sept," "Oct," "Nov," "Dec," "Jan 2000." The second
graph lists Exchange Ratio: 08/02/99 through 01/06/00. Number up the left side
shown as Exchange Ratio are listed at "0.30," "0.35," 0.40," 0.45," "0.50,"
"0.55," "0.60". Along the bottom are months with the first letter abbreviation
and a day of the week number above it, starting with A 6 and showing a point for
each week until J 6 2000. "J 6" is a dot with the words Deal Price 5 day avg.]
McLeodUSA logo . . .great timing
Slide 24
McLeodUSA and Splitrock. . .
Right Assets
Right Management
Right Execution
Right Time
McLeodUSA logo . . .right combination
Slide 25
McLeodUSA Investment of $100. . .
[Two bars representing Shareholder Investment showing an investment in McLeodUSA
of $100 in June 96 has grown to a value of $590 in Dec. 99. The Closing price
Dec. 31, 1999.]
McLeodUSA logo . . .first 3.5 years
Slide 26
Large McLeodUSA logo and Splitrock logo