Goldman Stanley

Goldman Stanley, Inc.

Confidential Draft

Project Aardvark

Presentation to the Board of DirectorsJanuary 29, 2010

Goldman Stanley

Table Of Contents

Executive Summary 3

Aardvark Valuation 5

Potential Acquisitions 11

Process Recommendations 16

Appendix 19

Goldman Stanley

Executive Summary

Goldman Stanley

Executive Summary

• As of January 29, 2010, Aardvark’s share price and valuation are at all-time highs, having more than doubled since early 2009

• As Aardvark’s stock price has soared in value, it has also generated over $35B in cash & cash-equivalents

• As Aardvark’s cash balance grows, it is likely to face shareholder pressure to re-invest the cash in its business and to make significant acquisitions

• Given Aardvark’s strong currency and cash balance, it could easily make several “tuck-in” acquisitions – or larger-scale acquisitions to acquire customers

• Such a strategy would allow Aardvark to capture more of the smartphone, laptop, and desktop markets, and significantly improve its software offerings

• Given Aardvark’s cash position, such acquisitions could be made with 100% cash – or in the case of a larger deal, stock could also be used

Goldman Stanley

Aardvark Valuation

Goldman Stanley

Valuation Summary

• Aardvark’s current share price of $192.61 far exceeds the value implied by comparable public companies

• Recent comparable transactions show higher implied valuation ranges due to flurry of consolidation and hardware M&A activity over 2009

• Discounted Cash Flow Analysis under base-case assumptions shows implied valuation on-par with Aardvark’s current share price, implying that share price is justified

• All valuation analysis is based on “base-case” financial projections in line with Wall Street analyst expectations

• Given Aardvark’s cash balance and high valuation multiples vs. similar public companies, few competitors are well-positioned to make substantial acquisitions

Goldman Stanley

Aardvark Valuation Summary

$0.00 $100.00 $200.00 $300.00 $400.00 $500.00 $600.00 $700.00

11-15% Discount Rate, 5-9x Terminal Multiple:

Forward EV / EBITDA:

Trailing EV / EBITDA:

Forward EV / Revenue:

Trailing EV / Revenue:

2010E P / E:

2009 P / E:

2010E EV / EBITDA:

2009 EV / EBITDA:

2010E EV / Revenue:

2009 EV / Revenue:

Min to 25th

25th to Median

Median to 75th

75th to Max

Public Company Comparables

Precedent Transactions

Discounted Cash Flow Analysis

Goldman Stanley

Aardvark Comparable Public Companies

Comparable Public Companies – Operating Metrics

Comparable Public Companies – Valuation Multiples

8% 8%

18%22%

-6%

25%

14%

7%

29%

39%

4%

31%

(10.0%)(5.0%)

0.0%5.0%

10.0%15.0%20.0%25.0%30.0%35.0%40.0%45.0%

2010E Revenue Growth

2009A EBITDA Margin

7.6 x

4.4 x

10.6 x

7.3 x

11.5 x 10.7 x

6.8 x

3.7 x

8.4 x

5.1 x 5.5 x

8.6 x

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10.0 x12.0 x14.0 x

2009 EBITDA Multiple

2010E EBITDA Multiple

Goldman Stanley

Aardvark Precedent Transactions

Aardvark - Comparable M&A Transactions Operating Metrics Valuation MultiplesEV / EV / EV /

Equity Enterprise Trailing Forward Trailing Forward Trailing Forward TrailingAcquirer Name Target Name Date Value Value Revenue Revenue EBITDA(1) EBITDA(1) Revenue Revenue EBITDA(1)

Hewlett-Packard Company 3Com 11/11/2009 3,180$ 2,714$ 1,265$ 1,223$ 152$ 110$ 2.1 x 2.2 x 17.8 xCisco Systems, Inc. Starent Networks 10/13/2009 2,777 2,386 288 320 154 110 8.3 x 7.5 x 15.5 xEmerson Electric Co. Avocent 10/6/2009 1,114 1,147 611 542 105 93 1.9 x 2.1 x 10.9 xEMC Corporation Data Domain 7/8/2009 2,362 2,085 301 375 53 64 6.9 x 5.6 x 39.7 xOracle Corporation Sun Microsystems 4/20/2009 7,075 5,392 13,256 12,462 623 559 0.4 x 0.4 x 8.7 xBrocade Communication Systems, Inc. Foundry Networks 7/21/2008 2,899 2,063 621 633 156 125 3.3 x 3.3 x 13.2 x

Maximum 7,075$ 5,392$ 13,256$ 12,462$ 623$ 559$ 8.3 x 7.5 x 39.7 x75th Percentile 3,110 2,632 1,104 1,075 155 121 6.0 x 5.0 x 17.3 x

Median 2,838$ 2,235$ 616$ 587$ 153$ 110$ 2.7 x 2.7 x 14.4 x25th Percentile 2,466 2,068 378 417 117 97 1.9 x 2.1 x 11.5 x

Minimum 1,114 1,147 288 320 53 64 0.4 x 0.4 x 8.7 x

Goldman Stanley

Aardvark Discounted Cash Flow AnalysisDCF Assumptions:

Discount Rate: 12.5%

Terminal EBITDA Multiple: 7.0 x

Model Uses “Base Case” Financial Projections

Mid-Year Convention Used For PV Of Cash Flows

Aardvark - Net Present Value Sensitivity - Terminal EBITDA MultiplesDiscount Rate

204.96$ 10.0% 11.0% 12.0% 13.0% 14.0% 15.0% 16.0%4.0 x 170.39$ 165.99$ 161.81$ 157.83$ 154.03$ 150.40$ 146.95$ 5.0 x 187.23$ 182.09$ 177.20$ 172.54$ 168.11$ 163.88$ 159.86$ 6.0 x 204.06$ 198.18$ 192.59$ 187.26$ 182.19$ 177.37$ 172.77$ 7.0 x 220.90$ 214.27$ 207.97$ 201.98$ 196.28$ 190.85$ 185.68$ 8.0 x 237.74$ 230.37$ 223.36$ 216.70$ 210.36$ 204.33$ 198.59$ 9.0 x 254.58$ 246.46$ 238.75$ 231.42$ 224.44$ 217.81$ 211.50$ Te

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Aardvark - Cash Flow ProjectionsFY 2010E FY 2011E FY 2012E FY 2013E FY 2014E

Revenue: $53,631 62,749$ 69,651$ 75,919$ 81,234$ EBITDA: $16,480 19,282$ 21,403$ 23,329$ 24,962$ Operating Income: $14,635 17,133$ 19,030$ 20,761$ 22,218$

Less: Taxes ($4,391) ($5,140) ($5,709) ($6,228) ($6,665)

Plus: Depreciation $918 $1,073 $1,192 $1,299 $1,390Plus: Amortization $40 $37 $28 $13 $10Plus: Stock-Based Compensation $888 $1,038 $1,153 $1,256 $1,344

Less: Increase in Working Capital: $2,136 $1,815 $1,374 $1,248 $1,058Less: Capital Expenditures ($1,430) ($1,673) ($1,857) ($2,024) ($2,166)

Unlevered Free Cash Flow $12,795 14,284$ 15,211$ 16,324$ 17,189$ Present Value of Free Cash Flow $12,064 11,971$ 11,332$ 10,811$ 10,119$

Goldman Stanley

Potential Acquisitions

Goldman Stanley

Potential Acquisitions

• Given Aardvark’s large cash balance, it could make a wide variety of acquisitions – ranging from small “tuck-in” deals to acquire technology and IP to larger deals driven by customer or market share acquisition

• Tier 1 Potential Acquisitions

– “Tier 1” acquisition candidates are worth over $1 billion and would significantly boost Aardvark’s market share or result in substantial revenue or cost synergies

– Leading candidates include ARM, for its chipset technology and integration with Aardvark’s existing products, and Research in Motion – to capture additional share in the corporate smartphone market

• Tier 2 Potential Acquisitions

– “Tier 2” acquisition candidates are worth less than $1 billion and would enhance Aardvark’s core technology and fill in gaps in existing products

– Potential acquisitions include specialized chipset and semiconductor companies as well as Web 2.0, social media, and mobile software companies

Goldman Stanley

Potential Acquisition Candidates

Tier 1 Acquisition Candidates

Tier 2 Acquisition Candidates

Goldman Stanley

Company Profile: ARM

ARM Holdings is a supplier of semiconductor intellectual property and components of digital electronic products. It designs and licenses intellectual property rather than manufacturing and selling semiconductor chips, and it licenses its IP to a wide network of hardware, mobile, and networking companies. It also provides tools to optimize system-on-chip designs.

Products:

• Processors – ARM provides 32-bit embedded microprocessors based on a common architecture that delivers high-performance, power efficiency, and reduced system cost.

• System IP – Serves as the connection between processors, memory, and peripherals to ensure optimum performance.

• Multimedia – ARM provides graphics processors that enable embedded graphics, audio, and video applications.

• Physical IP – Provides SoC integrated circuits and logic, embedded memory, and interface IP.

• Tools – ARM subsidiaries provide compilers, debuggers, simulators, and other optimization tools for a wide variety of chip and processor families.

Key Partners:

Electronic Arts, LSI Logic, Microsoft, National Semiconductor, Nokia, NVIDIA, Rambus, Real Networks, Samsung, and Toshiba.

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ARM Holdings

Headquarters: Cambridge, UKEmployees: 1700Founded: 1990

Financial Information:

Market Cap: $2.5BCash: $204M2009 Revenue: $490M2009 EPS: $7.852010E Revenue: $531M2010E EPS: $10.97

Management Team:

Warren East CEOTudor Brown PresidentGraham Budd COOMike Muller CTOTim Score CFOJohn Cornish EVP, SystemsIan Drew EVP, MarketingAntonio Viana EVP, Sales

Goldman Stanley

Company Profile: Research In Motion

Research In Motion designs the BlackBerry smartphone and creates solutions for the worldwide mobile communications market, including a variety of software for the BlackBerry device. In addition to its line of BlackBerry devices, the company also provides enterprise server software to support businesses using the device.

Products:

• BlackBerry Pearl 3G – Provides Trackpad and dedicated media keys as well as SureType technology and 3G network support.

• BlackBerry Bold – Provides extended battery life as well as GPS, Wi-Fi, and 3G network support.

• BlackBerry Curve 8500 – Includes Trackpad and dedicated media keys, easy media sharing, and 2.0 MP camera.

• BlackBerry Tour 9630 – Provides GPS, worldwide compatibility, and 3.2 MP camera.

• BlackBerry Storm – Features Wi-Fi, SurePress technology, and 3G network support.

• BlackBerry Curve 8900 – Features thin, lightweight design as well as GPS and Wi-Fi support and 3.2 MP camera.

Key Partners:

AT&T, Brightstar, Digital China, GPXS, Hewlett-Packard, IBM, Skype, Sprint, Tata Indicom, T-Mobile, Verizon, Virgin, and Vodafone,

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Research In Motion

Headquarters: Waterloo, ONEmployees: 12,000Founded: 1984

Financial Information:

Market Cap: $36BCash: $2.5B2009 Revenue: $13B2009 EPS: $3.702010E Revenue: $17B2010E EPS: $5.03

Management Team:

Jim Balsillie Co-CEOMike Lazaridis Co-CEODon Morrison COORobin Bienfait CIOBrian Bidulka CFODavid Yach CTO

Goldman Stanley

Process Recommendations

Goldman Stanley

Key Recommendations

• We recommend engaging in targeted discussions with the Tier 1 acquisition candidates and assessing their receptiveness to M&A discussions

• At the same time, Goldman Stanley will reach out to Tier 2 candidates and introduce Aardvark as a potential acquirer

• M&A process with Tier 1 candidates will take significantly longer due to the scale of the companies, so we recommend conducting both processes simultaneously

• Depending on responses from Tier 1 and Tier 2 candidates, Goldman Stanley and Aardvark may do additional research to determine other potential acquisitions and then approach them

Targeted Buy-Side M&A Broad Buy-Side M&A

Fewer than 5 parties contacted

Ranges from 10 to hundreds of companies

6 months to 1 year Time required is highly variable

Close-ended Iterative process

Higher success probability Lower success probability

Goldman Stanley

Process Recommendation

BroadMarketing

Goldman Stanley

Appendix

Goldman Stanley

Aardvark Projected Income StatementIncome Statement

FY 2007 FY 2008 FY 2009 FY 2010E FY 2011E FY 2012E FY 2013E FY 2014E

Revenue: $24,578 $37,491 $42,905 $53,631 $62,749 $69,651 $75,919 $81,234Cost of Goods Sold: $16,282 $24,049 $25,324 $31,655 $37,037 $41,111 $44,811 $47,948

Gross Profit: $8,296 $13,442 $17,581 $21,976 $25,712 $28,540 $31,109 $33,286Operating Expenses:

Research & Development: $596 $759 $830 $1,038 $1,214 $1,348 $1,469 $1,572Selling, General & Administrative: $2,724 $3,345 $3,566 $4,458 $5,216 $5,789 $6,311 $6,752

Total Operating Expenses: $3,320 $4,103 $4,397 $5,496 $6,430 $7,137 $7,780 $8,324

Depreciation & Amortization of PP&E: $327 $496 $734 $918 $1,073 $1,192 $1,299 $1,390Amortization of Intangibles: $0 $0 $0 $40 $37 $28 $13 $10Stock-Based Compensation: $242 $516 $710 $888 $1,038 $1,153 $1,256 $1,344

Operating Income: $4,407 $8,327 $11,740 $14,635 $17,133 $19,030 $20,761 $22,218Interest Income: $647 $653 $407 $424 $568 $1,443 $1,780 $3,223Interest Expense: $0 $0 $0 ($45) ($90) ($90) ($90) ($90)Other Income & Expense: ($48) ($33) ($81) $0 $0 $0 $0 $0

Pre-Tax Income: $5,006 $8,947 $12,066 $15,014 $17,610 $20,383 $22,450 $25,351Income Tax Provision: $1,511 $2,828 $3,831 $4,504 $5,283 $6,115 $6,735 $7,605

Net Income: $3,495 $6,119 $8,235 $10,510 $12,327 $14,268 $15,715 $17,746

Earnings Per Share (EPS): $3.93 $6.78 $9.08 $11.59 $13.59 $15.73 $17.33 $19.56Diluted Shares Outstanding: 889,292 902,139 907,005 907,005 907,005 907,005 907,005 907,005

EBIT: $4,649 $8,843 $12,450 $15,523 $18,171 $20,183 $22,017 $23,562EBITDA: $4,976 $9,339 $13,184 $16,480 $19,282 $21,403 $23,329 $24,962Levered Free Cash Flow: $4,735 $8,505 $10,311 $13,061 $14,618 $16,158 $17,507 $19,382Book Value Per Share (BV): $24.17 $34.56 $47.17 $61.94 $78.98 $97.70 $118.76

Goldman Stanley

Aardvark Comparable Public Companies

Operating Statistics Capitalization ProjectedShare Equity Enterprise Revenue EBITDA(2) EPS Revenue EBITDA Margin(2)

Company Name Price(1) Value Value 2009 2010E 2009 2010E 2009 2010E Growth(3) 2009 2010EHewlett-Packard Company 47.07$ 114,779$ 124,430$ 114,552$ 124,179$ 16,433$ 18,186$ 3.14$ 3.87$ 8.4% 14.3% 14.6%Dell Inc. 12.90 25,241 15,080 51,430 55,380 3,426 4,129 0.79 1.18 7.7% 6.7% 7.5%Cisco Systems, Inc. 22.47 131,739 106,671 34,807 41,163 10,076 12,774 0.97 1.38 18.3% 28.9% 31.0%Intel Corporation 19.40 107,224 92,786 32,784 39,941 12,708 18,332 0.41 1.17 21.8% 38.8% 45.9%Motorola, Inc. 6.15 14,239 10,665 23,457 22,056 926 1,927 (1.70) 0.14 (6.0%) 3.9% 8.7%

Maximum 47.07$ 131,739$ 124,430$ 114,552$ 124,179$ 16,433$ 18,332$ 3.14$ 3.87$ 21.8% 38.8% 45.9%75th Percentile 22.47 114,779 106,671 51,430 55,380 12,708 18,186 0.97 1.38 18.3% 28.9% 31.0%Median 19.40$ 107,224$ 92,786$ 34,807$ 41,163$ 10,076$ 12,774$ 0.79$ 1.18$ 8.4% 14.3% 14.6%25th Percentile 12.90 25,241 15,080 32,784 39,941 3,426 4,129 0.41 1.17 7.7% 6.7% 8.7%Minimum 6.15 14,239 10,665 23,457 22,056 926 1,927 (1.70) 0.14 (6.0%) 3.9% 7.5%

Aardvark 192.06$ 176,796$ 141,401$ $42,905 53,631$ $13,184 $16,480 $9.08 11.59$ 25.0% 30.7% 30.7%

Valuation Statistics Capitalization Enterprise Value / Enterprise Value / Share Equity Enterprise Revenue EBITDA(2) P / E Multiple

Company Name Price(1) Value Value 2009 2010E 2009 2010E 2009 2010EHewlett-Packard Company 47.07$ 114,779$ 124,430$ 1.1 x 1.0 x 7.6 x 6.8 x 15.0 x 12.2 xDell Inc. 12.90 25,241 15,080 0.3 x 0.3 x 4.4 x 3.7 x 16.4 x 10.9 xCisco Systems, Inc. 22.47 131,739 106,671 3.1 x 2.6 x 10.6 x 8.4 x 23.1 x 16.3 xIntel Corporation 19.40 107,224 92,786 2.8 x 2.3 x 7.3 x 5.1 x 47.2 x 16.6 xMotorola, Inc. 6.15 14,239 10,665 0.5 x 0.5 x 11.5 x 5.5 x NM 44.6 x

Maximum 47.07$ 131,739$ 124,430$ 3.1 x 2.6 x 11.5 x 8.4 x 47.2 x 44.6 x75th Percentile 22.47 114,779 106,671 2.8 x 2.3 x 10.6 x 6.8 x 29.1 x 16.6 xMedian 19.40$ 107,224$ 92,786$ 1.1 x 1.0 x 7.6 x 5.5 x 19.7 x 16.3 x25th Percentile 12.90 25,241 15,080 0.5 x 0.5 x 7.3 x 5.1 x 16.1 x 12.2 xMinimum 6.15 14,239 10,665 0.3 x 0.3 x 4.4 x 3.7 x 15.0 x 10.9 x

Aardvark 192.06$ 176,796$ 141,401$ 3.3 x 2.6 x 10.7 x 8.6 x 21.2 x 16.6 x

Goldman Stanley

Aardvark DCF Analysis – WACC CalculationDiscount Rate Calculation - AssumptionsRisk-Free Rate: 4.38%Equity Risk Premium: 7.00%Interest Rate on Debt: 9.00%

Comparable Companies - Unlevered Beta CalculationLevered Equity Unlevered

Name Beta Debt Value Tax Rate BetaHewlett-Packard Company 1.04 15,830$ 114,779$ 20.0% 0.94 Dell Inc. 1.31 3,793 25,241 27.0% 1.18 Cisco Systems, Inc. 1.23 10,273 131,739 22.0% 1.16 Intel Corporation 1.17 2,224 107,224 33.0% 1.15 Motorola, Inc. 1.87 3,925 14,239 34.0% 1.58

Median 1.23 1.16

Aardvark 1.57

Aardvark - Levered Beta & WACC CalculationUnlevered Equity Levered

Beta Debt Value Tax Rate Beta

Aardvark 1.16 $0 176,796$ 30% 1.16

Cost of Equity Based on Comparables: 12.50%Cost of Equity Based on Historical Beta: 15.37%

WACC 12.50%