Where Are The Asbestos Claims Going?

David AusternPresident, Claims Resolution Management Corporation and General Counsel, Manville

Personal Injury Settlement Trust

2003 Claim Filings as of 7/31/2003Top Claim Filers

Firm ID # of Claims974 4497

1241 3334161 3234

1524 30911342 28609387 28441349 2376271 2310357 2248

9432 22099850 2204

666627 13791180 12731106 12491101 1089109 1061

Subtotal 37258All Others 16162

Total Claims Filed 53420

Number of Claims Filed in 2003 by Disease as of 8/31/2003Month

Disease Jan-03 Feb-03 Mar-03 Apr-03 May-03 Jun-03 Jul-03 Aug-03 TotalsL1-L3 26 72 136 531 180 625 820 852 3,242 Other 171 51 265 179 280 132 261 514 1,853 Pleural 384 215 1,981 775 1,044 1,017 1965 2628 10,009 Asbestosis 4,698 3,343 4,931 3,925 4,887 4,427 9411 13847 49,469 Other Cancer 46 45 76 50 90 57 110 185 659 Lung Cancer 172 172 254 279 297 276 517 759 2,726 Mesothelioma 171 135 232 253 191 226 489 644 2,341 Month Totals 5,668 4,033 7,875 5,992 6,969 6,760 13,573 19,429 70,299

Year of First Exposure by Industry

1944194619481950195219541956195819601962

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000

Filing Year

Year

of 1

st E

xpos

ure Shipyard

Non-Asbestos Mfg.

Textile

Automotible orMechanical

Asbestos Exposure

Year of First Exposure: Injury

194019421944194619481950195219541956195819601962

Filing Year

Ave

rag

e Y

ear

of

1st

Exp

osu

re

Mesothelioma

Lung Cancer

Other Cancer

Asbestosis

Pleural Pleural

ARPC 2001

Year Production Imports Apparent Consumption1962 48,300.00 613,000.00 659,000.00 1963 60,200.00 606,000.00 657,000.00 1964 91,700.00 670,000.00 738,000.00 1965 107,000.00 653,000.00 721,000.00 1966 114,000.00 659,000.00 731,000.00 1967 112,000.00 585,000.00 654,000.00 1968 109,000.00 669,000.00 741,000.00 1969 114,000.00 630,000.00 712,000.00 1970 114,000.00 589,000.00 665,000.00 1971 119,000.00 618,000.00 699,000.00 1972 120,000.00 668,000.00 747,000.00 1973 136,000.00 718,000.00 803,000.00 1974 103,000.00 695,000.00 768,000.00 1975 99,000.00 490,000.00 552,000.00 1976 105,000.00 596,000.00 659,000.00 1977 92,000.00 551,000.00 610,000.00 1978 93,000.00 570,000.00 619,000.00 1979 93,000.00 513,000.00 564,000.00 1980 80,000.00 327,000.00 356,000.00 1981 76,000.00 338,000.00 349,000.00 1982 64,000.00 242,000.00 247,000.00 1983 70,000.00 196,000.00 217,000.00 1984 57,000.00 210,000.00 226,000.00 1985 57,000.00 142,000.00 162,000.00 1986 51,000.00 108,000.00 120,000.00 1987 51,000.00 94,000.00 84,000.00 1988 18,000.00 85,000.00 71,000.00 1989 17,000.00 55,000.00 55,000.00 1990 41,000.00 41,000.00 1991 20,000.00 35,000.00 35,000.00 1992 16,000.00 32,000.00 33,000.00 1993 14,000.00 31,000.00 32,000.00 1994 10,000.00 26,000.00 27,000.00 1995 9,000.00 22,000.00 22,000.00 1996 10,000.00 22,000.00 22,000.00 1997 7,000.00 21,000.00 21,000.00 1998 6,000.00 16,000.00 16,000.00 1999 7,000 16,000.00 22,000.002000 5,000 15,000.00 19,000.002001 5,000 13,000.00 22,000.002002 6,850.00 6,850.00

ASBESTOS STATISTICS

Manville TrustSummary of Forecasts Used in the Cash Flow Model

Meso: 100% of Nicholson; Lung: 23% of Nicholson

Not Appplicable2,684,719 8%

Nicholson 2000 Only 1,615,386 13%Peto 2000 Only 1,578,393 13%Peto 1998 To 2000 1,417,851 17%Nicholson 1998 To 2000 1,289,759 17%Peto 1997 To 1999 1,195,446 13%Nicholson 1997 To 1999 1,029,889 12%Peto 1996 To 1998 747,726 7%

1,421,598Weighted Average

Mesothelioma and Lung Cancer

Calibration Period (Based on Diagnosis

Year)

Number of Claims (2001 to

2049)

Cash Flow Model

Selection Probability

ARPC 2001

Manville Trust Claim Filing/Settlement History as of 7/31/2003

Year Total Filings Cancer % Total Settlements Total Paid Amount1988 32,437 14.66% 12,374 487,297,441$ 1989 100,074 15.80% 4,908 207,020,184$ 1990 21,521 18.02% 9,438 321,016,274$ 1991 15,304 16.86% 170 4,176,774$ 1992 15,713 15.30% 178 6,775,398$ 1993 14,097 10.22% 1,071 36,691,975$ 1994 24,408 13.83% 1,669 21,038,605$ 1995 31,485 12.89% 55,007 273,133,116$ 1996 51,010 7.92% 53,353 243,777,718$ 1997 23,631 14.46% 30,521 148,678,855$ 1998 29,378 10.48% 25,231 109,133,241$ 1999 31,650 11.86% 82,734 302,810,365$ 2000 57,869 8.84% 63,787 254,169,928$ 2001 86,124 6.25% 101,676 313,236,897$ 2002 55,677 9.76% 68,232 189,753,080$ 2003 53,420 8.14% 42,421 112,435,022$ Total 643,798 11.32% 552,770 3,031,144,873$

FUTURE CLAIMS FORECASTING BASED FUTURE CLAIMS FORECASTING BASED ON MEDICAL MODELS MAY BE ON MEDICAL MODELS MAY BE

MISLEADINGMISLEADINGHistory of the Manville Personal Injury Settlement Trust Future Claims Forecasting Employing Medical Models

Year of Forecast

1993

1995

1997

2000

2001

Forecast 2002-2049

149,000

266,000

333,000

441,000

1,353,000

% Change

N/A

79%

25%

32%

207%

Within 1-3 years: Example of 12 new trusts – Assets > $20B

Note: Figures are likely amounts, based on announced settlements and/or plans. Revisions are certain; likely more will increase than will decrease.

Halliburton 4,000

Pittsburgh Corning 3,000

Honeywell 2,900

Federal Mogul 2,500

Owens Corning 2,500

Armstrong World Industries 1,800

W.R. Grace 1,250

Combustion Engineering 1,200

MacArthur Firms 1,000

Asbestos Claims Management (NG) 350

A.P. Green Services (RHI Refractories) 300

Babcock & Wilcox 100+

Total 20,900

$

$

(000)

Future trusts: Example of likely backlogs of claims:

Note: backlog estimates based on claims pending at bankruptcy filing date or where available, bar date figures.

Federal Mogul 365,000

Halliburton 328,000

NARCO 260,000

A C and S, Inc. 250,000

Owens Corning 237,000

Babcock & Wilcox 221,375

Armstrong World Industries 173,000

G-I Holdings 150,000

Pittsburgh Corning 140,000

U.S. Mineral Products Co. 129,400

W.R. Grace 124,000

Combustion Engineering 111,000

Plibrico Co. 100,000

USG Corp 92,000

Porter-Hayden 58,000

Total 2,738,775

Potential total claim flow from example of 15 new trusts

Assumptions:• Three trusts come on line the first year; four per year thereafter• Backlog burn rate of up to 120k/year per trust• Run rate after backlog burn at 1/7 of backlog

-

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

900,000

1,000,000

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013