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Financial and Stock Market PerformancePublic Software Companies By Product Category

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Copyright © 2009 by Software Equity Group, L.L.C., All Rights Reserved

San Diego, CA 9213012220 El Camino Real, #320

Public SaaS CompaniesPublic Internet Companies By Product Category

Software Equity Group, L.L.C.

p: (858) 509-2800f: (858) 509-2818

September 2009

Software Equity Group Flash Report

Selected M&A Transactionsand

www.softwareequity.com

mailto: [email protected]


ABOUT OUR FIRM

Software Equity Group is an investment bank and M&A advisory serving the software and technology sectors. Founded in 1992, our firm has represented and guided private companies throughout the United States and Canada, as well as Europe, Asia Pacific, Africa and Israel. We have advised public companies listed on the NASDAQ, NYSE, American, Toronto, London and Euronext exchanges. Software Equity Group also represents several of the world's leading private equity firms. We were recently ranked among the top ten investment banks worldwide for application software mergers and acquisitions.

Our value proposition is unique and compelling. We are skilled and accomplished investment bankers with extraordinary software, internet and technology domainexpertise. Our industry knowledge and experience span virtually every software product category, technology, market and delivery model, including Software-as-a Service (Saas), software on-demand and perpetual license. We have profound understanding of software company finances, operations and valuation. We monitor and analyze every publicly disclosed software M&A transaction, as well as the market, economy and technology trends that impact these deals. We're formidable negotiators and savvy dealmakers who facilitate strategic combinations that enhance shareholder value.

THE SEG SOFTWARE COMPANY MENTORING PROGRAM

As part of our informal mentoring program, we are currently guiding and advising some fifty software companies around the globe that are not yet exit candidates, but aspire to be in the next few years. We meet with them periodically, invite them to call whenever they’d like our opinion on an operational issue that might have exit implications later on, and we keep them apprised of M&A activity and financings in their product category. And the best news – we don’t charge for this mentoring advice. It’s complimentary. It’s our way of building value, and relationships.

We’re looking for a few more such relationships. We begin with an introductory phone call with companies interested in being mentored, followed by a more in-depth telephone conversation. We’ll then invite qualified candidates to meet personally with four or five members of our team at our San Diego office. During this three to four hour sit-down, we’ll discuss the current market, specifically as it relates to valuations, transactions and trends in your product category. We’ll assess the strengths and weakness of your financial performance, how that compares to other software companies your size, and how that relates to buyer expectations. We’ll discuss your market strategy, sales strategy, sales team track record, software and maintenance pricing strategies, equity structure, and a wide array of other factors that can materially impact your salability and valuation down the road. We’re a terrific sounding board. We’ll give you an informed, honest and frank opinion – that’s what we’re known for. And we’ll offer informed and insightful observations, ideas and options based on 17 years of working with countless software companies worldwide.

If you run a profitable software company with revenue in excess of $10 million, and you’re interested in learning more about SEG’s complimentary, no obligation mentoring program, please contact Kris Beible at [email protected] or 858-509-2800.

ADDITIONAL RESEARCH

For our complimentary current and archived Quarterly Reports from 1Q03, please visit: http://www.softwareequity.com/research_quarterly_reports.aspx

For our complimentary current and archived Monthly Flash Reports from July 2008, please visit: http://www.softwareequity.com/research_flash_reports.aspx

For our Annual Reports from 2003 through 2008, please visit: http://www.softwareequity.com/research_annual_reports.aspx


http://www.softwareequity.com/research_quarterly_reports.aspx

http://www.softwareequity.com/research_flash_reports.aspx

http://www.softwareequity.com/research_annual_reports.aspx

CAD Computer-aided DesignCAM Computer-aided ManufacturingCRM Customer Relationship ManagementEBITDA Earnings before Interest, Taxes, Depreciation, and AmortizationEV Enterprise ValueFCF Free Cash FlowFORWARD Current EV / Next Four Quarters' Consensus Financial EstimatesHR Human ResourcesNASDAQ National Association of Securities Dealers Automated Quotation SystemOS Operating SystemPLM Product Lifecycle ManagementR&D Research and DevelopmentS&P Standard & Poor'sSaaS Software-as-a-ServiceSEG Software Equity GroupSG&A Selling, General, & AdministrativeSW SoftwareTTM Trailing Twelve MonthYoY Year-over-YearYTD Year-to-date

List of Commonly Used Acronyms


August 2009

Selected Software Industry M&A Transactions


Selected August 2009 Software Industry M&A Transactions

Date Announced Target EV/ Revenue

08/31/2009 Actimize, Inc. Fortent, Inc. - $73.5 -08/31/2009 EMC Corporation (NYSE:EMC) FastScale Technology, Inc. - - -08/27/2009 Cray Inc. (NasdaqGM:CRAY) PathScale, LLC - - -08/27/2009 Minati Capital Corp. (TSXV:MNN.P) First Global Data Corporation - - -08/26/2009 NYSE Technologies Limited NYFIX Inc. (NasdaqCM:NYFX) $110.0 $164.1 1.5x08/26/2009 PSI AG (XTRA:PSA2) AIS Advanced Information Systems Gmbh & Co. - - -08/26/2009 Reval.com, Inc. FXpress Corporation - - -08/26/2009 Neusoft Corporation (SHSE:600718) Sesca Mobile Software Oy - $5.0 -08/26/2009 Autodesk, Inc. (NasdaqGS:ADSK) BOSS International, Inc. - - -08/26/2009 IJJ Corp. (OTCPK:IJJP) V-Clouds, Inc. - $0.1 -08/26/2009 Instinet Group Incorporated TORC Financial, LLC - - -08/26/2009 Neusoft Corporation (SHSE:600718) Almitas Oy - - -08/26/2009 Neusoft Corporation (SHSE:600718) Sesca Technologies SRL - - -08/24/2009 Live Gamer, Inc. TwoFish, Inc. - - -08/24/2009 Research In Motion Ltd. (TSX:RIM) Torch Mobile, Inc. - - -08/24/2009 Platform Computing Inc. Hewlett-Packard Company, HP-MPI - - -08/21/2009 Tibco Software Inc. (NasdaqGS:TIBX) Datasynapse, Inc. - $27.7 -08/20/2009 School Specialty Inc. (NasdaqGS:SCHS) AutoSkill International Inc. $10.0 $11.7 1.2x08/20/2009 Yovia, LLC SourceFuse LLC - - -08/19/2009 NuGrowth Solutions LLC Strategic Insurance Software Inc. - - -08/19/2009 Intel Corporation (NasdaqGS:INTC) RapidMind, Inc. - - -08/17/2009 Healthland American HealthNet, Inc. - - -08/14/2009 Blytheco, LLC Synergistic Software Solutions LLC, MAS Practice - - -08/14/2009 Alibaba.com Limited (SEHK:1688) Alisoft Holding Limited, Business Management Software Division - $33.3 -08/14/2009 Han Logistics, Inc. (OTCBB:HANO) OnSite Media LLC - $21.8 -08/14/2009 IRIS Group Limited Formation Software Limited - - -08/13/2009 Fluke Networks, Inc. AirMagnet, Inc. - - -08/13/2009 Wallingford Software Limited MWH Soft, Inc. - - -08/13/2009 Industrial & Financial Systems IFS AB (OM:IFS B) Multiplus Solutions AS $7.6 - -08/12/2009 Xora, Inc. Gearworks, Inc. - - -08/12/2009 iSOFT Group Limited (ASX:ISF) BridgeForward Software, Inc. - $14.9 -08/12/2009 TAKE Supply Chain PSI Software, Inc. - - -08/11/2009 Epicor Software (Aust) Pty. Ltd. Spectrax Pty. Ltd. - - -08/11/2009 Ando Media, LLC Spacial Audio Solutions, LLC - - -08/10/2009 BMC Software Inc. (NYSE:BMC) MQSoftware, Inc. - - -08/10/2009 Extreme Networks Inc. (NasdaqGM:EXTR) Soapstone Networks Inc., Software Assets - - -08/07/2009 Versata Inc. Everest Software, Inc. - - -08/07/2009 VMware, Inc. (NYSE:VMW) SpringSource, Inc. - $420.0 -08/07/2009 Gary Jonas Computing Ltd. Compusource Corporation - - -08/06/2009 Becton, Dickinson and Company (NYSE:BDX) ICPA, Inc. - - -08/05/2009 Apache Design Solutions, Inc. Sequence Design, Inc. - - -08/05/2009 MB Trading Holdings, LLC The Wizetrade Group, LLP - - -08/04/2009 WatchGuard Technologies, Inc. BorderWare Technologies, Inc. - - -08/04/2009 RedZone Robotics, Inc. ICOMMM, Inc - - -08/03/2009 Rudolph Technologies Inc. (NasdaqGS:RTEC) Rudolph Technologies Process Control Group - $5.0 -08/03/2009 Thomson Reuters PLC (LSE:TRIL) Vhayu Technologies Corp. - - -08/03/2009 OmniComm Ltd. Logos Technologies Ltd. - $0.2 -08/01/2009 Concur Technologies, Inc. (NasdaqGS:CNQR) Etap-On-Line - - -


Target TTM Revenue ($mm)Acquirer

Implied Enterprise Value ($mm)

Category Performance

SEG Software Index


SEG Software Index: All Categories

Market Cap EV TTM RevenueTTM Gross

MarginTTM EBITDA

Margin

TTM Revenue Growth EV/ Revenue

EV/ EBITDA

Forward EV/ Revenue

Forward EV/

EBITDA

YoY Stock Market Return

SEG Software Index $424.66 $382.37 $231.25 66.5% 14.7% 1.9% 1.7x 11.2x 1.8x 9.6x -13.9% Billing & Service Provisioning $657.93 $561.79 $349.00 49.8% 16.9% 2.9% 1.2x 5.7x 1.3x 5.6x -12.6% Business Intelligence $495.00 $384.79 $181.98 77.8% 17.4% 1.5% 1.9x 10.7x 2.0x 8.4x 19.1% Content/Document Management $57.27 $71.26 $88.64 72.5% 24.2% 3.4% 1.7x 7.4x 2.5x 9.1x -17.9% CRM, Marketing & Sales Software $118.04 $61.47 $90.66 60.1% -0.7% -20.4% 0.7x 23.0x 0.7x 12.9x -19.5% Database & File Management $1,454.65 $1,171.40 $464.63 83.0% 22.4% 3.8% 1.6x 7.7x 1.9x 7.5x 1.3% Dev Tools, OS & Application Testing Software $510.18 $426.95 $287.21 70.4% 16.0% 1.6% 1.5x 9.2x 3.3x 8.3x -23.7% eCommerce Enablement Software $514.44 $443.11 $172.53 65.2% 13.2% 12.3% 3.0x 19.5x 3.6x 21.1x -33.7% Education & eLearning $106.40 $100.09 $102.82 70.2% 9.5% 3.3% 1.6x 15.2x 1.9x 16.1x -16.1% Electronic Design Automation $831.51 $952.39 $803.89 78.2% -5.4% -21.5% 1.2x 10.4x 1.3x 12.5x -27.6% Engineering, PLM & CAD/CAM Software $866.06 $1,031.25 $386.04 81.0% 13.6% -5.2% 1.8x 12.8x 1.5x 8.5x -27.6% Enterprise Application Integration $1,549.00 $1,263.51 $623.43 71.5% 19.8% 0.9% 2.0x 12.4x 2.1x 8.0x 1.3% Enterprise Resource Planning $500.36 $556.26 $409.23 54.7% 16.7% -3.0% 1.7x 10.6x 1.6x 9.6x -10.6% Entertainment $1,709.63 $967.83 $255.57 59.0% 14.2% -0.5% 0.9x 6.0x 0.8x 11.2x -45.4% Financial Services Software $693.00 $868.18 $265.47 56.9% 19.9% 4.4% 2.3x 11.5x 2.3x 9.3x -11.7% Healthcare $424.66 $400.81 $192.63 57.7% 21.8% 8.3% 2.3x 14.4x 2.3x 15.8x 10.3% HR & Workforce Management $181.48 $148.88 $103.87 68.1% 3.4% 15.0% 2.2x 12.6x 2.0x 24.4x -6.0% Messaging, Conferencing & Communications $176.80 $103.09 $112.86 64.2% 11.0% 1.2% 1.5x 9.3x 1.5x 9.6x -10.7% Multimedia, Graphics, Digital Media $482.13 $358.84 $428.65 68.9% 14.9% -8.5% 1.8x 12.1x 1.6x 7.3x -26.6% Networking & Connectivity $1,357.04 $862.28 $457.14 77.7% 20.3% 3.2% 2.5x 10.5x 1.6x 7.3x -8.5% Security $655.73 $598.90 $170.53 77.0% 19.1% 10.6% 3.3x 12.1x 2.7x 10.8x -4.5% Storage & Systems Management Software $7,104.15 $5,932.26 $1,898.55 80.7% 19.6% 1.0% 2.1x 11.6x 2.1x 9.7x -10.7% Supply Chain Management & Logistics $332.01 $227.51 $259.78 58.1% 10.5% -2.2% 1.3x 10.8x 1.4x 8.0x -13.0% Wireless $295.34 $225.63 $147.28 41.3% 11.9% -7.2% 0.9x 12.8x 1.5x 10.8x 6.6%

TTM Revenue Growth 1.9%TTM EBITDA Growth 11.7%TTM Earnings Growth -10.7%Gross Profit Margin 66.5%EBITDA Margin 14.7%Net Income Margin 4.6%SG&A Expenses as a % of Total Revenue 38.2%R&D Expenses as a % of Total Revenue 15.3%

Current Ratio 1.9Quick Ratio 1.7Cash as Percent of Market Cap 22.0%Avg Days Outstanding: Accounts Receivable 71Avg Days Outstanding: Accounts Payable 42Working Capital to TTM Operating Expense Ratio 0.4

Levered FCF Margin 7.9%Cash from Operations Growth (YoY) 2.2%Cash from Investing Growth (YoY) -22.4%Cash from Financing Growth (YoY) -10.0%Levered FCF Growth (YoY) 7.3%


Category Name

Income Statement Analysis (Median)

Balance Sheet Analysis (Median)

Cash Flow Statement Analysis (Median

September 2009 Monthly Flash Report

SEG SW Index Stock Market Return: Jan-Aug 2009

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DOW S&P 500 NASDAQ SEG SW Index

SEG Software Index Category: Billing and Service Provisioning

Company Name Ticker Market Cap EV TTM RevenueTTM Gross

MarginTTM EBITDA

Margin

TTM Revenue Growth EV/ Revenue EV/ EBITDA

Forward EV/ Revenue

Forward EV/ EBITDA


Amdocs Limited DOX $4,960.45 $3,982.22 $2,980.47 35.8% 20.2% -2.7% 1.3x 6.6x 1.3x 5.6x -19.4%AsiaInfo Holdings, Inc. ASIA $786.66 $573.87 $208.02 52.0% 13.7% 38.5% 2.8x 20.1x 3.6x 18.6x 30.9%CSG Systems International, Inc. CSGS $529.20 $549.71 $489.97 47.6% 23.4% 8.5% 1.1x 4.8x 1.2x 4.4x -20.3%MIND C.T.I. Ltd. MNDO $19.30 $7.50 $17.81 66.2% 12.5% -10.0% 0.4x 3.4x n/a n/a -5.7%

Median: $657.93 $561.79 $349.00 49.8% 16.9% 2.9% 1.2x 5.7x 1.3x 5.6x -12.6%



Levered FCF Margin 7.2%Cash from Operations Growth (YoY) -5.4%Cash from Investing Growth (YoY) -143.3%Cash from Financing Growth (YoY) 5.9%Levered FCF Growth (YoY) 56.4%



Cash Flow Statement Analysis (Median


Income Statement Analysis (Median) Billing & Service Provisioning Software Stock Market Return: Jan-Aug 2009

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Billing & Service Provisioning SW S&P 500 NASDAQ SEG SW Index

SEG Software Index Category: Business Intelligence


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


Actuate Corporation ACTU $255.13 $210.88 $125.67 83.0% 17.0% -9.0% 1.7x 9.9x 1.6x 8.4x 31.6%Datawatch Corporation DWCH $15.70 $10.26 $20.37 72.5% 10.0% -17.1% 0.5x 5.0x n/a n/a 40.4%Informatica Corporation INFA $1,588.80 $1,368.48 $464.63 83.0% 21.7% 8.7% 2.9x 13.6x 3.0x 13.8x 6.6%MicroStrategy Incorporated MSTR $734.88 $558.71 $353.63 82.1% 20.8% -2.1% 1.6x 7.6x 1.5x 7.5x -3.8%Pegasystems Inc. PEGA $1,113.25 $923.19 $238.30 64.9% 15.3% 26.5% 3.9x 25.4x 4.5x n/a 108.9%PROS Holdings PRO $207.74 $153.99 $74.41 73.5% 17.8% 5.2% 2.1x 11.6x 2.0x 8.3x -16.2%

Median: $495.00 $384.79 $181.98 77.8% 17.4% 1.5% 1.9x 10.7x 2.0x 8.4x 19.1%



Levered FCF Margin 6.4%Cash from Operations Growth (YoY) -13.6%Cash from Investing Growth (YoY) 39.9%Cash from Financing Growth (YoY) -117.9%Levered FCF Growth (YoY) -39.1%




Cash Flow Statement Analysis (Median)


Business Intelligence Software Stock Market Return: Jan-Aug 2009

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Business Intelligence SW S&P 500 NASDAQ SEG SW Index

SEG Software Index Category: Content & Document Management


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


Adobe Systems Incorporated ADBE $16,495.44 $14,181.25 $3,293.62 89.5% 35.7% -7.0% 4.3x 12.1x 4.0x 8.6x -26.6%Datawatch Corporation DWCH $15.70 $10.26 $20.37 72.5% 10.0% -17.1% 0.5x 5.0x n/a n/a 40.4%EasyLink Services International ESIC $44.09 $71.26 $88.64 70.8% 24.2% 20.4% 0.8x 3.3x 0.8x n/a -55.4%Ninetowns Internet Tech Grp Ltd. NINE $57.27 -$32.81 $15.66 69.9% -41.8% 3.4% n/a n/a n/a n/a -17.9%Open Text Corporation OTEX $1,974.76 $2,001.62 $785.67 74.0% 26.1% 8.3% 2.5x 9.8x 2.5x 9.6x 0.3%

Median: $57.27 $71.26 $88.64 72.5% 24.2% 3.4% 1.7x 7.4x 2.5x 9.1x -17.9%



Levered FCF Margin 12.9%Cash from Operations Growth (YoY) -3.7%Cash from Investing Growth (YoY) -195.2%Cash from Financing Growth (YoY) -7.8%Levered FCF Growth (YoY) -8.0%





Income Statement Analysis (Median) Content & Document Management Software Stock Market Return: Jan-Aug 2009

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Content & Document Management SW S&P 500 NASDAQ SEG SW Index

SEG Software Index Category: CRM, Marketing, and Sales


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


Astea International Inc. ATEA $12.44 $8.70 $21.07 37.8% -7.4% -20.4% 0.4x n/a n/a n/a 15.9%Blackbaud, Inc. BLKB $844.02 $868.18 $311.71 60.1% 17.8% 11.4% 2.8x 15.6x 2.8x n/a -4.7%Chordiant Software, Inc. CHRD $118.04 $61.47 $90.66 71.1% 2.2% -22.3% 0.7x 30.5x 0.5x n/a -34.3%Rainmaker Systems Inc. RMKR $29.97 $16.62 $51.81 38.8% -20.0% -33.3% 0.3x n/a 0.2x n/a -53.7%Unica Corporation UNCA $147.48 $98.75 $104.80 73.7% -0.7% -14.0% 0.9x n/a 0.8x 12.9x -19.5%

Median: $118.04 $61.47 $90.66 60.1% -0.7% -20.4% 0.7x 23.0x 0.7x 12.9x -19.5%

TTM Revenue Growth -20.4%TTM EBITDA Growth -61.3%TTM Earnings Growth -196.4%Gross Profit Margin 60.1%EBITDA Margin -0.7%Net Income Margin -7.4%SG&A Expenses as a % of Total Revenue 32.9%R&D Expenses as a % of Total Revenue 19.7%


Levered FCF Margin -3.9%Cash from Operations Growth (YoY) 13.0%Cash from Investing Growth (YoY) -48.0%Cash from Financing Growth (YoY) 100.8%Levered FCF Growth (YoY) 21.0%






CRM, Marketing, & Sales Software Stock Market Return: Jan-Aug 2009

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CRM, Marketing, & Sales SW S&P 500 NASDAQ SEG SW Index

SEG Software Index Category: Database and File Management


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


BMC Software, Inc. BMC $6,559.21 $5,676.41 $1,884.40 77.7% 32.3% 5.6% 3.0x 9.3x 3.0x 7.5x 9.5%Double-Take Software DBTK $193.67 $109.58 $88.09 89.3% 18.6% -4.5% 1.2x 6.7x 1.1x 4.5x -33.0%Guidance Software, Inc. GUID $101.67 $68.09 $83.37 71.7% -12.2% -3.0% 0.8x n/a 0.8x n/a -31.7%Informatica Corporation INFA $1,588.80 $1,368.48 $464.63 83.0% 21.7% 8.7% 2.9x 13.6x 3.0x 13.8x 6.6%Oracle Corporation ORCL $109,730.37 $107,699.37 $23,252.00 79.4% 42.2% 3.7% 4.6x 11.0x 4.6x 9.6x -0.2%Pervasive Software Inc. PVSW $87.23 $43.82 $47.22 87.6% 17.3% 11.2% 0.9x 5.4x 0.9x 4.8x 8.4%Quest Software, Inc. QSFT $1,454.65 $1,171.40 $719.02 90.7% 22.4% 5.0% 1.6x 7.3x 1.6x 6.6x 11.5%Sybase, Inc. SY $2,820.72 $2,489.34 $1,134.54 71.5% 27.2% 3.8% 2.2x 8.1x 2.2x 7.6x 1.3%Versant Corporation VSNT $54.17 $27.41 $20.00 90.8% 37.0% -19.6% 1.4x 3.7x n/a n/a -40.5%

Median: $1,454.65 $1,171.40 $464.63 83.0% 22.4% 3.8% 1.6x 7.7x 1.9x 7.5x 1.3%



Levered FCF Margin 15.3%Cash from Operations Growth (YoY) -2.3%Cash from Investing Growth (YoY) -144.5%Cash from Financing Growth (YoY) -117.0%Levered FCF Growth (YoY) 11.1%





Income Statement Analysis (Median) Database & File Management Software Stock Market Return: Jan-Aug 2009

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Database & File Management SW S&P 500 NASDAQ SEG SW Index

SEG Software Index Category: Development Tools, OS, and App Testing


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


BSQUARE Corporation BSQR $22.47 $16.26 $66.06 26.8% 2.5% 7.2% 0.2x 10.0x n/a n/a -40.5%Google Inc. GOOG $146,151.47 $126,807.47 $22,274.18 61.5% 39.6% 13.6% 5.7x 14.4x 5.8x 13.7x -0.3%Magic Software Enterprises Ltd. MGIC $51.99 $15.26 $58.25 54.1% 13.8% -5.2% 0.3x 1.9x n/a n/a -30.6%Microsoft Corporation MSFT $219,648.11 $195,497.11 $58,437.00 79.2% 39.8% -3.3% 3.3x 8.4x 3.3x 8.3x -9.7%Phoenix Technologies Ltd. PTEC $127.08 $108.17 $70.47 85.8% -26.8% 1.6% 1.5x n/a 1.4x 7.4x -67.1%Progress Software Corporation PRGS $893.27 $745.73 $503.96 84.9% 18.2% -0.8% 1.5x 8.1x 1.4x 6.0x -23.7%Red Hat, Inc. RHT $4,316.64 $3,599.13 $670.33 84.2% 19.3% 19.5% 5.4x 27.8x 5.5x 20.9x 9.3%

Median: $510.18 $426.95 $287.21 70.4% 16.0% 1.6% 1.5x 9.2x 3.3x 8.3x -23.7%

TTM Revenue Growth 1.6%TTM EBITDA Growth -12.0%TTM Earnings Growth -49.8%Gross Profit Margin 70.4%EBITDA Margin 16.0%Net Income Margin 6.9%SG&A Expenses as a % of Total Revenue 36.9%R&D Expenses as a % of Total Revenue 14.0%


Levered FCF Margin 14.3%Cash from Operations Growth (YoY) -4.3%Cash from Investing Growth (YoY) -93.6%Cash from Financing Growth (YoY) -83.5%Levered FCF Growth (YoY) 27.2%






Development Tools, OS, and App Testing Software Stock Market Return: Jan-Aug 2009

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Development Tools, OS, and App Testing SW S&P 500 NASDAQ SEG SW Index

SEG Software Index Category: eCommerce Enablement Software


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


Art Technology Group, Inc. ARTG $514.44 $443.11 $172.53 65.2% 13.2% 12.3% 2.6x 19.5x 2.8x 21.1x -1.5%CyberSource Corporation CYBS $1,065.55 $972.50 $243.33 52.5% 17.5% 34.4% 4.0x 22.8x 4.3x 21.6x -10.7%Imergent, Inc. IIG $76.49 $54.96 $104.15 72.3% -7.7% -27.3% 0.5x n/a n/a n/a -40.8%Optimal Group Inc. OPMR $11.28 $0.24 $123.17 16.8% -17.4% 85.2% n/a n/a n/a n/a -83.2%VeriSign, Inc. VRSN $4,086.89 $3,395.64 $996.05 76.9% 38.8% 10.2% 3.4x 8.8x 3.6x 7.7x -33.7%

Median: $514.44 $443.11 $172.53 65.2% 13.2% 12.3% 3.0x 19.5x 3.6x 21.1x -33.7%

TTM Revenue Growth 12.3%TTM EBITDA Growth 80.9%TTM Earnings Growth 30.3%Gross Profit Margin 65.2%EBITDA Margin 13.2%Net Income Margin -14.9%SG&A Expenses as a % of Total Revenue 39.0%R&D Expenses as a % of Total Revenue 9.1%


Levered FCF Margin 5.4%Cash from Operations Growth (YoY) 25.5%Cash from Investing Growth (YoY) 106.2%Cash from Financing Growth (YoY) 74.1%Levered FCF Growth (YoY) 26.9%






eCommerce Enablement Software Stock Market Return: Jan-Aug 2009

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eCommerce Enablement SW S&P 500 NASDAQ SEG SW Index

SEG Software Index Category: Education and eLearning


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


Blackboard Inc. BBBB $1,101.09 $1,195.44 $346.67 70.2% 19.8% 29.0% 3.4x 17.4x 3.8x 20.4x -13.9%GSE Systems Inc. GVP $105.42 $100.09 $34.14 26.6% 5.8% 16.6% 2.9x 50.4x 3.5x n/a -18.4%PLATO Learning, Inc. TUTR $106.40 $96.16 $67.57 52.4% 10.9% -3.2% 1.4x 13.0x 1.4x 20.3x 137.1%Renaissance Learning, Inc. RLRN $288.89 $271.64 $115.13 77.7% 22.3% 3.3% 2.4x 10.6x 2.4x 11.8x -21.9%Rosetta Stone, Inc. RST $448.54 $382.37 $232.80 86.4% 9.5% 44.5% 1.6x 17.3x n/a n/a n/aSaba Software, Inc. SABA $99.68 $74.33 $102.82 61.0% 6.0% -4.6% 0.7x 12.1x 0.7x 8.2x -5.8%Scientific Learning Corporation SCIL $55.59 $53.14 $44.43 75.0% 0.0% -1.8% 1.2x n/a 1.1x n/a -25.2%

Median: $106.40 $100.09 $102.82 70.2% 9.5% 3.3% 1.6x 15.2x 1.9x 16.1x -16.1%



Levered FCF Margin 1.5%Cash from Operations Growth (YoY) 56.1%Cash from Investing Growth (YoY) 37.8%Cash from Financing Growth (YoY) -1.6%Levered FCF Growth (YoY) 104.0%





Income Statement Analysis (Median) Education & eLearning Software Stock Market Return: Jan-Aug 2009

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Education & Computer Based Training SW S&P 500 NASDAQ SEG SW Index

SEG Software Index Category: Electronic Design Automation


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


Cadence Design Systems, Inc. CDNS $1,670.32 $1,534.08 $876.05 78.2% -9.9% -39.1% 1.8x n/a 1.5x 15.3x -21.5%Magma Design Automation, Inc. LAVA $69.01 $85.98 $130.06 68.6% -5.4% n/a 0.7x n/a n/a n/a -71.9%Mentor Graphics Corporation MENT $831.51 $952.39 $803.89 86.1% 7.8% -3.9% 1.2x 15.2x 1.2x 12.5x -27.6%PDF Solutions, Inc. PDFS $71.33 $33.75 $52.35 51.8% -31.0% -41.9% 0.6x n/a 0.4x n/a -57.6%Synopsys, Inc. SNPS $3,063.38 $1,980.84 $1,374.57 82.8% 25.3% 5.8% 1.4x 5.7x 1.5x 6.4x -1.4%

Median: $831.51 $952.39 $803.89 78.2% -5.4% -21.5% 1.2x 10.4x 1.3x 12.5x -27.6%

TTM Revenue Growth -21.5%TTM EBITDA Growth -130.7%TTM Earnings Growth n/aGross Profit Margin 78.2%EBITDA Margin -5.4%Net Income Margin -89.8%SG&A Expenses as a % of Total Revenue 50.8%R&D Expenses as a % of Total Revenue 45.4%


Levered FCF Margin 9.7%Cash from Operations Growth (YoY) -25.0%Cash from Investing Growth (YoY) 65.1%Cash from Financing Growth (YoY) 74.6%Levered FCF Growth (YoY) 145.4%






Electronic Design Automation Software Stock Market Return: Jan-Aug 2009

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Electronic Design Automation SW S&P 500 NASDAQ SEG SW Index

SEG Software Index Category: Engineering, PLM, & CAD/CAM


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


ANSYS, Inc. ANSS $3,095.27 $3,079.64 $495.88 87.6% 44.9% 16.4% 6.2x 13.8x 6.2x 11.0x -20.8%Autodesk, Inc. ADSK $5,382.64 $4,446.24 $1,937.60 89.5% 17.6% -17.8% 2.3x 13.1x 1.9x 7.2x -34.1%Cadence Design Systems, Inc. CDNS $1,670.32 $1,534.08 $876.05 78.2% -9.9% -39.1% 1.8x n/a 1.5x 15.3x -21.5%Cimatron Ltd. CIMT $7.87 -$0.39 $36.23 81.0% n/a -5.9% n/a n/a n/a n/a -62.5%Dassault Systèmes DSY $5,984.04 $4,942.12 $1,881.96 84.0% 20.9% 2.0% 2.6x 12.5x 2.6x 9.3x -13.7%DigitalGlobe, Inc. DGI $900.61 $1,110.11 $276.20 89.6% 57.5% n/a 4.0x 7.0x n/a n/a n/aGSE Systems Inc. GVP $105.42 $100.09 $34.14 26.6% 5.8% 16.6% 2.9x 50.4x 3.5x n/a -18.4%Magma Design Automation, Inc. LAVA $69.01 $85.98 $130.06 68.6% -5.4% n/a 0.7x n/a n/a n/a -71.9%Mentor Graphics Corporation MENT $831.51 $952.39 $803.89 86.1% 7.8% -3.9% 1.2x 15.2x 1.2x 12.5x -27.6%MSC.Software Corporation MSCS $345.33 $197.10 $234.00 81.0% 8.5% -7.8% 0.8x 9.9x 0.8x n/a -41.6%Parametric Technology Corporation PMTC $1,545.21 $1,369.15 $991.39 67.2% 13.6% -4.4% 1.4x 10.1x 1.3x 5.3x -33.8%PDF Solutions, Inc. PDFS $71.33 $33.75 $52.35 51.8% -31.0% -41.9% 0.6x n/a 0.4x n/a -57.6%Stratasys, Inc. SSYS $291.27 $251.61 $110.31 47.9% 16.6% -7.0% 2.3x 13.7x 2.0x 7.8x -13.6%Synopsys, Inc. SNPS $3,063.38 $1,980.84 $1,374.57 82.8% 25.3% 5.8% 1.4x 5.7x 1.5x 6.4x -1.4%

Median: $866.06 $1,031.25 $386.04 81.0% 13.6% -5.2% 1.8x 12.8x 1.5x 8.5x -27.6%

TTM Revenue Growth -5.2%TTM EBITDA Growth -24.3%TTM Earnings Growth -74.7%Gross Profit Margin 81.0%EBITDA Margin 13.6%Net Income Margin 1.4%SG&A Expenses as a % of Total Revenue 38.6%R&D Expenses as a % of Total Revenue 25.0%


Levered FCF Margin 8.1%Cash from Operations Growth (YoY) -18.6%Cash from Investing Growth (YoY) 1.6%Cash from Financing Growth (YoY) 44.6%Levered FCF Growth (YoY) -16.3%





Income Statement Analysis (Median) Engineering, PLM, & CAD/CAM Software Stock Market Return: Jan-Aug 2009

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Engineering, PLM, & CAD/CAM SW S&P 500 NASDAQ SEG SW Index

SEG Software Index Category: Enterprise Application Integration


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


BluePhoenix Solutions, Ltd. BPHX $68.65 $60.26 $84.23 45.4% 4.9% -14.1% 0.7x 14.6x 0.7x 6.0x -38.6%Citrix Systems, Inc. CTXS $6,527.35 $5,947.67 $1,576.48 91.7% 19.8% 3.8% 3.8x 19.1x 3.7x 14.2x 17.8%Jacada Ltd. JCDA $30.66 $5.34 $17.57 38.1% -51.6% -13.0% 0.3x n/a n/a n/a -52.5%Sybase, Inc. SY $2,820.72 $2,489.34 $1,134.54 71.5% 27.2% 3.8% 2.2x 8.1x 2.2x 7.6x 1.3%TIBCO Software Inc. TIBX $1,549.00 $1,263.51 $623.43 73.2% 20.1% 0.9% 2.0x 10.1x 1.9x 8.5x 8.3%

Median: $1,549.00 $1,263.51 $623.43 71.5% 19.8% 0.9% 2.0x 12.4x 2.1x 8.0x 1.3%



Levered FCF Margin 12.0%Cash from Operations Growth (YoY) 5.6%Cash from Investing Growth (YoY) 46.8%Cash from Financing Growth (YoY) 75.0%Levered FCF Growth (YoY) -9.4%






Enterprise Application Integration Software Stock Market Return: Jan-Aug 2009

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Enterprise Application Integration SW S&P 500 NASDAQ SEG SW Index

SEG Software Index Category: Enterprise Resource Planning


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


American Software, Inc. AMSW.A $159.41 $111.80 $78.02 55.0% 11.3% -12.3% 1.4x 12.6x 1.4x 9.8x 6.1%CDC Corporation CHIN.A $249.05 $244.94 $361.61 42.9% 6.9% -14.5% 0.7x 9.7x 0.6x 10.7x -11.3%Deltek PROJ $462.15 $528.29 $274.01 62.4% 18.9% -6.8% 1.9x 10.2x 1.8x 8.4x -10.2%Epicor Software Corporation EPIC $384.72 $561.97 $456.85 53.5% 15.7% 0.9% 1.2x 7.8x 1.1x 7.2x -26.1%Intuit Inc. INTU $8,971.49 $8,624.20 $3,182.54 80.7% 30.1% 3.6% 2.7x 9.0x 2.7x 7.7x -7.6%Lawson Software, Inc. LWSN $995.41 $828.54 $757.33 52.6% 13.6% -11.1% 1.1x 8.0x 1.1x 8.5x -23.9%Oracle Corporation ORCL $109,730.37 $107,699.37 $23,252.00 79.4% 42.2% 3.7% 4.6x 11.0x 4.6x 9.6x -0.2%QAD Inc. QADI $125.91 $102.13 $233.40 54.5% 2.1% -16.1% 0.4x 20.8x 0.4x n/a -38.0%SAP SAP $57,524.71 $57,133.17 $15,976.37 66.3% 31.1% 2.2% 3.6x 11.5x 3.4x 12.1x -11.0%Tyler Technologies, Inc. TYL $538.58 $550.55 $279.92 43.3% 17.8% 15.5% 2.0x 11.1x 2.1x 11.0x -6.0%

Median: $500.36 $556.26 $409.23 54.7% 16.7% -3.0% 1.7x 10.6x 1.6x 9.6x -10.6%

TTM Revenue Growth -3.0%TTM EBITDA Growth 10.2%TTM Earnings Growth -1.1%Gross Profit Margin 54.7%EBITDA Margin 16.7%Net Income Margin 5.9%SG&A Expenses as a % of Total Revenue 31.6%R&D Expenses as a % of Total Revenue 11.4%


Levered FCF Margin 7.7%Cash from Operations Growth (YoY) -11.7%Cash from Investing Growth (YoY) 23.0%Cash from Financing Growth (YoY) -4.3%Levered FCF Growth (YoY) 8.0%






Enterprise Resource Planning Software Stock Market Return: Jan-Aug 2009

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Enterprise Resource Planning SW S&P 500 NASDAQ SEG SW Index

SEG Software Index Category: Entertainment


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


Electronic Arts Inc. ERTS $5,894.58 $3,615.58 $4,052.00 46.9% -7.8% -0.5% 0.9x n/a 0.9x n/a -62.7%Giant Interactive GA $1,709.63 $967.83 $198.47 88.4% 62.5% -25.4% 4.9x 7.8x 4.2x 6.7x -17.6%Glu Mobile, Inc. GLUU $39.71 $48.00 $86.12 65.4% -13.3% 8.9% 0.6x n/a 0.5x 20.8x -62.5%Konami Corporation KNM $2,627.79 $2,698.21 $3,168.17 29.3% 14.2% -4.1% 0.9x 6.0x 0.8x 5.8x -45.4%Majesco Entertainment Company COOL $52.38 $42.86 $85.82 34.6% 11.0% 61.0% 0.5x 4.5x 0.7x n/a 71.6%Perfect World PWRD $1,876.28 $1,734.09 $255.57 87.4% 55.6% 57.3% 6.8x 12.2x 8.3x 15.8x 52.0%THQ Inc. THQI $371.73 $243.68 $935.89 59.0% 31.0% -12.0% 0.3x 0.8x 0.3x n/a -64.0%

Median: $1,709.63 $967.83 $255.57 59.0% 14.2% -0.5% 0.9x 6.0x 0.8x 11.2x -45.4%

TTM Revenue Growth -0.5%TTM EBITDA Growth -17.1%TTM Earnings Growth -72.3%Gross Profit Margin 59.0%EBITDA Margin 14.2%Net Income Margin 1.9%SG&A Expenses as a % of Total Revenue 25.7%R&D Expenses as a % of Total Revenue 11.4%


Levered FCF Margin 6.0%Cash from Operations Growth (YoY) -4.2%Cash from Investing Growth (YoY) 2.3%Cash from Financing Growth (YoY) -88.6%Levered FCF Growth (YoY) 23.5%





Income Statement Analysis (Median) Entertainment Software Stock Market Return: Jan-Aug 2009

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Entertainment SW S&P 500 NASDAQ SEG SW Index

SEG Software Index Category: Financial Services


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


ACI Worldwide, Inc. ACIW $461.33 $421.92 $393.15 58.0% 8.8% 1.8% 1.1x 12.2x 1.0x 11.1x -25.2%Advent Software, Inc. ADVS $986.25 $939.21 $281.65 68.8% 16.0% 17.1% 3.3x 20.8x 3.6x 18.7x -16.3%Blackbaud, Inc. BLKB $844.02 $868.18 $311.71 60.1% 17.8% 11.4% 2.8x 15.6x 2.8x n/a -4.7%Bottomline Technologies EPAY $303.25 $252.95 $138.01 55.9% 5.8% 5.2% 1.8x 31.7x 1.8x 15.8x 5.0%DST Systems, Inc. DST $2,277.81 $3,350.11 $2,239.60 19.9% 19.9% -3.1% 1.5x 7.5x 2.0x 7.1x -25.8%Ebix, Inc. EBIX $510.19 $541.04 $83.40 79.8% 44.4% 42.7% 6.5x 14.6x n/a n/a 35.2%EPIQ Systems, Inc. EPIQ $541.99 $571.06 $249.28 54.4% 19.9% 22.8% 2.3x 11.5x 2.8x 9.9x 32.8%Fair Isaac Corporation FICO $1,089.47 $1,343.38 $657.00 65.5% 25.3% -14.2% 2.0x 8.1x 1.8x 8.2x -3.5%Fiserv FISV $7,448.79 $11,019.79 $4,217.00 39.6% 29.3% -8.9% 2.6x 8.9x 2.3x 8.3x -7.0%Fundtech Ltd. FNDT $151.27 $107.03 $115.71 55.3% 10.0% 0.0% 0.9x 9.3x 0.9x 6.8x -31.4%Goldleaf Financial Solutions, Inc. GFSI $18.80 $64.79 $76.52 71.0% 9.2% 11.6% 0.8x 9.2x 0.8x 4.1x -43.7%Jack Henry & Associates, Inc. JKHY $1,962.59 $1,906.80 $745.59 40.2% 29.8% 0.4% 2.6x 8.6x 2.6x 8.8x 16.4%Longtop Financial Technologies LFT $1,267.01 $1,056.67 $115.46 64.4% 45.1% 56.4% 9.2x 20.3x 10.1x 20.0x 35.1%Metavante Technologies, Inc. MV $3,803.01 $5,397.60 $1,724.99 35.3% 26.0% 3.6% 3.1x 12.0x 3.2x 11.2x 33.3%MSCI MXB $2,946.04 $3,019.14 $433.11 71.5% 40.2% 6.4% 7.0x 17.3x 7.0x 15.7x -1.4%NetSol Technologies Inc. NTWK $26.54 $47.11 $30.11 49.4% -3.1% -13.2% 1.6x n/a 1.3x 3.6x -68.3%Risk Metrics Group, Inc RMG $963.94 $1,069.02 $303.96 69.2% 33.1% 10.5% 3.5x 10.6x 3.6x 11.0x -29.9%S1 Corporation SONE $332.91 $275.27 $236.40 54.8% 16.4% 9.5% 1.2x 7.1x 1.2x 6.6x -17.6%Sapiens International SPNS $22.67 $18.40 $43.01 42.2% n/a 1.9% 0.4x n/a n/a n/a -51.4%TradeStation Group, Inc. TRAD $299.90 n/a $154.32 75.7% n/a -2.1% n/a n/a n/a n/a -28.6%

Median: $693.00 $868.18 $265.47 56.9% 19.9% 4.4% 2.3x 11.5x 2.3x 9.3x -11.7%








Income Statement Analysis (Median) Financial Services Software Stock Market Return: Jan-Aug 2009

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Financial Services SW S&P 500 NASDAQ SEG SW Index

SEG Software Index Category: Healthcare


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


Allscripts Healthcare Solutions Inc. MDRX $2,151.78 $2,145.56 $548.44 53.3% 10.9% 42.9% 3.9x 35.9x 3.3x 18.3x n/aAMICAS, Inc. AMCS $125.50 $90.88 $58.76 49.7% -2.7% 14.5% 1.5x n/a 1.8x n/a 21.2%Cerner Corporation CERN $5,000.98 $4,765.43 $1,684.59 82.6% 25.0% 8.3% 2.8x 11.3x 2.9x 11.1x 34.0%Computer Programs and Sys, Inc. CPSI $424.66 $400.81 $123.38 43.8% 21.8% 8.8% 3.2x 14.9x 3.4x 15.9x 42.6%Eclipsys Corporation ECLP $947.51 $932.50 $519.25 43.8% 8.0% 3.4% 1.8x 22.5x 1.8x 15.8x -24.8%eResearchTechnology, Inc. ERES $303.97 $234.38 $111.96 54.5% 34.9% -8.3% 2.1x 6.0x 1.7x n/a -53.5%MedAssets MDAS $1,250.75 $1,502.04 $322.86 79.3% 26.9% 44.7% 4.7x 17.3x 5.5x 17.3x 25.6%Merge Healthcare MRGE $192.41 $187.30 $60.34 76.9% 49.8% 6.4% 3.1x 6.2x n/a n/a 154.0%Omnicell, Inc. OMCL $347.59 $221.17 $231.25 50.1% 8.2% -3.1% 1.0x 11.6x 0.9x 6.4x -28.5%Phase Forward Incorporated PFWD $555.78 $417.18 $192.63 57.7% 15.6% 27.1% 2.2x 13.9x 2.5x 12.3x -33.4%Quality Systems, Inc. QSII $1,537.89 $1,460.46 $256.93 62.8% 29.4% 28.7% 5.7x 19.3x 5.9x 17.5x 25.7%Simulations Plus, Inc. SLP $28.54 $21.16 $9.14 76.4% 25.0% -2.4% 2.3x 9.3x 2.2x 5.9x -0.6%Vital Images, Inc. VTAL $180.97 $56.74 $63.28 76.0% 0.2% -5.3% 0.9x 366.1x 0.8x n/a -19.0%

Median: $424.66 $400.81 $192.63 57.7% 21.8% 8.3% 2.3x 14.4x 2.3x 15.8x 10.3%

TTM Revenue Growth 8.3%TTM EBITDA Growth 12.0%TTM Earnings Growth 2.5%Gross Profit Margin 57.7%EBITDA Margin 21.8%Net Income Margin 9.3%SG&A Expenses as a % of Total Revenue 36.4%R&D Expenses as a % of Total Revenue 12.4%








Healthcare Software Stock Market Return: Jan-Aug 2009

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Healthcare SW S&P 500 NASDAQ SEG SW Index

SEG Software Index Category: HR and Workforce Management


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


Callidus Software Inc. CALD $82.04 $42.83 $103.87 42.9% -4.9% 2.6% 0.4x n/a 0.4x n/a -42.5%ClickSoftware Technologies Ltd. CKSW $181.48 $148.88 $57.13 68.1% 20.6% 33.1% 2.6x 12.6x 2.8x 24.4x 156.6%The Ultimate Software Group, Inc. ULTI $649.04 $621.54 $189.73 53.7% 3.4% 15.0% 3.3x 95.4x 3.5x 30.9x -6.0%Websense, Inc. WBSN $669.95 $704.19 $316.36 84.7% 20.2% 25.8% 2.2x 11.0x 2.0x 5.5x -33.0%Workstream Inc. WSTM $11.63 $30.16 $23.34 73.5% -6.9% -16.6% 1.3x n/a 1.1x n/a 2.5%

Median: $181.48 $148.88 $103.87 68.1% 3.4% 15.0% 2.2x 12.6x 2.0x 24.4x -6.0%



Levered FCF Margin 0.9%Cash from Operations Growth (YoY) 20.6%Cash from Investing Growth (YoY) -9.4%Cash from Financing Growth (YoY) -120.7%Levered FCF Growth (YoY) n/a





Income Statement Analysis (Median) HR & Workforce Management Software Stock Market Return: Jan-Aug 2009

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HR & Workforce Management SW S&P 500 NASDAQ SEG SW Index

SEG Software Index Category: Messaging, Conferencing, and Comms


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


8x8 Inc. EGHT $57.68 $42.27 $63.95 64.2% -3.9% 1.2% 0.7x n/a 0.6x 12.1x -10.7%Evolving Systems, Inc. EVOL $56.56 $55.95 $37.52 64.7% 20.0% 1.0% 1.5x 7.4x 1.5x 9.3x 56.2%Interactive Intelligence, Inc. ININ $295.07 $241.01 $123.68 67.9% 11.0% 4.3% 1.9x 17.7x 2.0x 20.4x 71.7%OpenTV Corp. OPTV $176.80 $65.89 $112.86 61.3% 12.2% -7.9% 0.6x 4.8x 0.6x 3.6x -31.9%SeaChange International, Inc. SEAC $275.27 $199.46 $205.33 51.4% 10.5% 10.1% 1.0x 9.3x 1.0x 10.0x 4.2%Synchronoss Technologies, Inc. SNCR $329.62 $262.88 $117.66 50.2% 19.9% -5.3% 2.2x 11.2x 2.4x 8.8x -16.0%Zix Corporation ZIXI $115.24 $103.09 $28.51 66.4% -17.5% 4.3% 3.6x n/a 3.7x n/a -34.5%

Median: $176.80 $103.09 $112.86 64.2% 11.0% 1.2% 1.5x 9.3x 1.5x 9.6x -10.7%



Levered FCF Margin 4.8%Cash from Operations Growth (YoY) 4.0%Cash from Investing Growth (YoY) -184.1%Cash from Financing Growth (YoY) -99.5%Levered FCF Growth (YoY) -66.6%





Income Statement Analysis (Median) Messaging, Conferencing, & Comms Software Stock Market Return: Jan-Aug 2009

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Messaging, Conferencing, & Comms SW S&P 500 NASDAQ SEG SW Index

SEG Software Index Category: Multimedia, Graphics, and Digital Media


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


Adobe Systems Incorporated ADBE $16,495.44 $14,181.25 $3,293.62 89.5% 35.7% -7.0% 4.3x 12.1x 4.0x 8.6x -26.6%Avid Technology, Inc. AVID $487.11 $368.53 $725.94 47.9% -2.0% -19.9% 0.5x n/a 0.4x 2.9x -43.9%Bitstream Inc. BITS $50.13 $32.68 $21.37 59.4% 6.8% -14.4% 1.5x 22.4x n/a n/a -15.2%DigitalGlobe, Inc. DGI $170.56 $34.62 $81.48 91.2% 13.7% -12.1% 0.4x 3.1x n/a n/a -43.1%DivX, Inc. DIVX $900.61 $1,110.11 $276.20 89.6% 57.5% n/a 4.0x 7.0x 0.4x 1.4x n/aMonotype Imaging Holdings TYPE $283.37 $349.15 $100.54 92.5% 41.6% -8.5% 3.5x 8.4x 3.2x 7.3x -34.7%NICE Systems Ltd. NICE $1,674.64 $1,295.12 $605.19 60.9% 16.1% 5.5% 2.1x 13.3x 2.1x 8.4x -8.3%Nuance Communications, Inc. NUAN $3,317.08 $3,799.96 $940.41 66.5% 20.3% 18.3% 4.0x 19.9x 4.1x 14.0x -22.0%RealNetworks, Inc. RNWK $477.14 $118.01 $581.10 56.4% -10.9% -3.5% 0.2x n/a 0.2x 2.2x -46.6%Sonic Solutions SNIC $141.40 $117.67 $115.37 71.3% -1.4% -13.2% 1.0x n/a 1.0x n/a 14.2%

Median: $482.13 $358.84 $428.65 68.9% 14.9% -8.5% 1.8x 12.1x 1.6x 7.3x -26.6%



Levered FCF Margin 13.6%Cash from Operations Growth (YoY) -0.7%Cash from Investing Growth (YoY) -50.8%Cash from Financing Growth (YoY) 46.9%Levered FCF Growth (YoY) -9.7%






Multimedia, Graphics, & Digital Media Software Stock Market Return: Jan-Aug 2009

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Multimedia, Graphics, & Digital Media SW S&P 500 NASDAQ SEG SW Index

SEG Software Index Category: Networking and Connectivity


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


Allot Communications Ltd. ALLT $83.64 $44.20 $38.76 73.2% -10.2% 16.2% 1.1x n/a 1.2x n/a 52.8%CA, Inc. CA $11,675.50 $10,615.50 $4,234.00 86.2% 32.9% -2.4% 2.5x 7.6x 2.5x 7.3x -6.8%Cisco Systems, Inc. CSCO $124,586.23 $99,910.23 $36,117.00 63.9% 25.3% -8.7% 2.8x 10.9x 2.8x 9.7x -10.2%Citrix Systems, Inc. CTXS $6,527.35 $5,947.67 $1,576.48 91.7% 19.8% 3.8% 3.8x 19.1x 3.7x 14.2x 17.8%F5 Networks, Inc. FFIV $2,716.15 $2,452.08 $649.21 77.6% 22.1% 4.0% 3.8x 17.1x 3.8x 13.4x 1.1%NetScout Systems Inc. NTCT $462.50 $439.74 $265.06 77.0% 20.8% 31.4% 1.7x 8.0x 1.6x 6.5x -23.1%Novell, Inc. NOVL $1,501.58 $580.08 $891.29 77.7% 14.1% -6.8% 0.7x 4.6x 0.6x 4.4x -32.3%OPNET Technologies, Inc. OPNT $196.38 $104.92 $120.51 75.8% 8.5% 11.5% 0.9x 10.2x 0.8x 7.0x -28.6%Radware Ltd. RDWR $208.76 $127.89 $95.97 79.4% -14.0% 2.5% 1.3x n/a 1.3x n/a 13.4%SolarWinds, Inc. SWI $1,212.51 $1,144.48 $102.18 95.8% 45.6% 30.6% 11.2x 24.6x n/a n/a n/aTTI Team Telecom International Ltd. TTIL $19.20 -$6.93 $47.39 53.1% 6.9% -7.6% n/a n/a n/a n/a -26.8%

Median: $1,357.04 $862.28 $457.14 77.7% 20.3% 3.2% 2.5x 10.5x 1.6x 7.3x -8.5%



Levered FCF Margin 14.2%Cash from Operations Growth (YoY) 20.0%Cash from Investing Growth (YoY) -116.7%Cash from Financing Growth (YoY) 41.2%Levered FCF Growth (YoY) 32.9%






Networking & Connectivity Software Stock Market Return: Jan-Aug 2009

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Networking and Connectivity SW S&P 500 NASDAQ SEG SW Index

SEG Software Index Category: Security


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


ActivCard Corp. ACTI $115.06 $36.52 $63.45 67.3% -5.9% 11.1% 0.6x n/a 0.6x n/a -6.3%ArcSight, Inc. ARST $641.51 $551.04 $136.17 81.4% 10.8% 34.1% 4.0x 37.6x 4.1x 41.0x 99.1%Blue Coat Systems, Inc. BCSI $779.22 $734.06 $458.23 71.5% 8.3% 32.6% 1.6x 19.4x 1.6x n/a 5.4%Check Point Software Tech Ltd. CHKP $5,817.31 $4,795.92 $835.94 90.6% 51.7% 6.9% 5.7x 11.1x 5.9x 11.3x 13.8%Cogent, Inc. COGT $941.27 $646.76 $137.81 64.5% 38.2% 45.0% 4.7x 12.3x 5.1x 11.2x -4.5%Commtouch Software Ltd. CTCH $65.69 $54.56 $14.40 86.5% 19.6% 9.1% 3.8x 19.4x n/a n/a -10.9%McAfee, Inc. MFE $6,253.42 $5,490.37 $1,750.06 79.2% 21.2% 21.1% 3.1x 14.8x 3.4x 12.4x 0.6%SonicWALL, Inc. SNWL $403.35 $229.73 $203.24 72.1% 11.0% -6.8% 1.1x 10.2x 1.1x 10.3x 14.5%Sourcefire, Inc. FIRE $505.50 $402.25 $86.78 77.1% 2.8% 36.0% 4.6x 164.4x 5.6x n/a 142.0%Symantec Corporation SYMC $12,315.32 $11,891.32 $5,931.85 85.5% 30.9% -3.1% 2.0x 6.5x 1.9x 5.1x -32.2%VASCO Data Security International VDSI $324.64 $257.05 $116.27 69.8% 18.7% -7.3% 2.2x 11.9x 1.9x n/a -37.3%VeriSign, Inc. VRSN $4,086.89 $3,395.64 $996.05 76.9% 38.8% 10.2% 3.4x 8.8x 3.6x 7.7x -33.7%Websense, Inc. WBSN $669.95 $704.19 $316.36 84.7% 20.2% 25.8% 2.2x 11.0x 2.0x 5.5x -33.0%Zix Corporation ZIXI $115.24 $103.09 $28.51 66.4% -17.5% 4.3% 3.6x n/a 3.7x n/a -34.5%

Median: $655.73 $598.90 $170.53 77.0% 19.1% 10.6% 3.3x 12.1x 2.7x 10.8x -4.5%



Levered FCF Margin 8.5%Cash from Operations Growth (YoY) 20.6%Cash from Investing Growth (YoY) -113.8%Cash from Financing Growth (YoY) 51.0%Levered FCF Growth (YoY) 19.2%





Income Statement Analysis (Median) Security Software Stock Market Return: Jan-Aug 2009

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Security SW S&P 500 NASDAQ SEG SW Index

SEG Software Index Category: Storage and Systems Management


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


BMC Software, Inc. BMC $6,559.21 $5,676.41 $1,884.40 77.7% 32.3% 5.6% 3.0x 9.3x 3.0x 7.5x 9.5%CA, Inc. CA $11,675.50 $10,615.50 $4,234.00 86.2% 32.9% -2.4% 2.5x 7.6x 2.5x 7.3x -6.8%CommVault Systems, Inc. CVLT $764.10 $644.89 $239.77 86.9% 10.8% 14.6% 2.7x 25.0x 2.7x 16.3x 8.5%Compuware Corporation CPWR $1,712.64 $1,321.96 $1,006.26 61.8% 22.0% -19.4% 1.3x 6.0x 1.2x n/a -36.9%EMC EMC $32,150.56 $28,330.73 $14,140.34 54.5% 17.3% -0.9% 2.0x 11.6x 1.9x 9.7x 4.1%FalconStor Software, Inc. FALC $226.22 $189.27 $88.48 83.7% 4.0% 1.3% 2.1x 53.5x 2.2x n/a -32.7%Network Appliance, Inc. NTAP $7,649.10 $6,188.12 $3,504.29 60.6% 11.3% 0.6% 1.8x 15.7x 1.8x 14.5x -10.7%SupportSoft, Inc. SPRT $109.40 $12.64 $54.32 43.3% -29.8% 112.7% 0.2x n/a 0.3x n/a -32.7%Symantec Corporation SYMC $12,315.32 $11,891.32 $5,931.85 85.5% 30.9% -3.1% 2.0x 6.5x 1.9x 5.1x -32.2%VMWare VMW $14,043.08 $12,217.42 $1,912.71 84.2% 23.6% 14.9% 6.4x 27.0x 6.5x 21.5x -10.8%

Median: $7,104.15 $5,932.26 $1,898.55 80.7% 19.6% 1.0% 2.1x 11.6x 2.1x 9.7x -10.7%



Levered FCF Margin 15.8%Cash from Operations Growth (YoY) 0.6%Cash from Investing Growth (YoY) 7.7%Cash from Financing Growth (YoY) -45.3%Levered FCF Growth (YoY) 11.1%






Storage & Systems Management Software Stock Market Return: Jan-Aug 2009

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Storage & Systems Management SW S&P 500 NASDAQ SEG SW Index

SEG Software Index Category: Supply Chain Management and Logistics


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


American Software, Inc. AMSW.A $159.41 $111.80 $78.02 55.0% 11.3% -12.3% 1.4x 12.6x 1.4x 9.8x 6.1%Ariba, Inc. ARBA $1,012.73 $883.80 $340.19 63.2% 9.4% 7.0% 2.6x 27.6x 2.7x 23.9x -22.2%Aspen Technology, Inc. AZPN $903.45 $916.61 $311.61 72.7% 10.1% -8.6% 2.9x 29.0x 3.0x n/a -30.6%i2 Technologies, Inc. ITWO $336.39 $269.69 $241.94 61.2% 20.1% -5.9% 1.1x 5.6x 1.1x n/a 4.1%JDA Software Group JDAS $618.30 $575.63 $387.48 64.1% 24.5% 2.6% 1.5x 6.1x 1.5x 6.1x 6.1%Manhattan Associates, Inc. MANH $401.79 $313.82 $277.62 54.0% 10.8% -20.3% 1.1x 10.4x 0.9x 5.8x -27.2%ModusLink Global Solutions, Inc. MLNK $327.64 $159.92 $1,059.64 11.5% 3.1% 1.5% 0.2x 4.9x n/a n/a -39.1%Retalix Ltd. RTLX $186.77 $123.46 $204.27 41.6% 6.4% -9.8% 0.6x 9.4x n/a n/a -19.4%The Descartes Systems Group Inc. DSG $236.00 $185.33 $67.17 67.5% 24.8% 8.3% 2.8x 11.1x n/a n/a 36.1%XATA Corporation XATA $30.77 $52.63 $66.87 47.3% 5.5% 56.5% 0.8x 14.4x 1.0x n/a -6.7%

Median: $332.01 $227.51 $259.78 58.1% 10.5% -2.2% 1.3x 10.8x 1.4x 8.0x -13.0%








Income Statement Analysis (Median) Supply Chain Management & Logistics Software Stock Market Return: Jan-Aug 2009

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Supply Chain Management & Logistics SW S&P 500 NASDAQ SEG SW Index

SEG Software Index Category: Wireless


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


Hurray! Holding Co., Ltd. HRAY $78.14 $22.55 $49.56 18.0% n/a -10.7% 0.5x n/a n/a n/a 23.3%Itron, Inc. ITRI $2,191.27 $2,889.20 $1,719.47 33.2% 13.1% -9.8% 1.7x 12.8x 1.5x 9.9x -47.1%Openwave Systems Inc. OPWV $230.75 $121.67 $191.70 62.7% 2.8% -4.6% 0.6x 22.9x 0.6x n/a 92.4%PCTEL, Inc. PCTI $110.78 $42.82 $65.86 46.8% 5.3% -12.6% 0.7x 12.3x 0.6x 3.6x -41.6%Smith Micro Software, Inc. SMSI $374.21 $330.38 $102.87 82.5% 18.0% 20.0% 3.2x 17.8x 3.3x 20.0x 52.6%TeleCommunication Systems, Inc. TSYS $359.93 $329.58 $273.46 35.8% 11.9% 71.9% 1.2x 10.2x 1.6x 11.8x -10.2%

Median: $295.34 $225.63 $147.28 41.3% 11.9% -7.2% 0.9x 12.8x 1.5x 10.8x 6.6%

TTM Revenue Growth -7.2%TTM EBITDA Growth 59.2%TTM Earnings Growth 3.1%Gross Profit Margin 41.3%EBITDA Margin 11.9%Net Income Margin -1.7%SG&A Expenses as a % of Total Revenue 34.0%R&D Expenses as a % of Total Revenue 11.5%


Levered FCF Margin 5.6%Cash from Operations Growth (YoY) 60.5%Cash from Investing Growth (YoY) -72.2%Cash from Financing Growth (YoY) 77.1%Levered FCF Growth (YoY) -41.7%






Wireless Software Stock Market Return: Jan-Aug 2009

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Wireless SW S&P 500 NASDAQ SEG SW Index

Company Performance

SEG SaaS Index


SEG SaaS Index


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


Athenahealth ATHN $1,351.17 $1,266.32 $165.64 58.1% 13.2% 41.5% 7.6x 57.7x 9.2x 58.3x 24.7%Concur CNQR $1,720.41 $1,478.61 $240.33 69.5% 24.7% 24.1% 6.2x 24.9x 6.9x 25.8x -19.5%Constant Contact CTCT $589.59 $482.72 $107.40 71.3% 2.6% 57.2% 4.5x 174.5x 5.6x 128.3x 21.8%DealerTrack TRAK $812.89 $634.16 $228.79 50.6% 11.0% -8.9% 2.8x 25.1x 2.6x 14.1x 9.4%DemandTec DMAN $239.93 $171.94 $76.50 68.1% -4.0% 15.8% 2.2x n/a 2.3x 24.9x -18.3%Kenexa KNXA $276.28 $229.29 $177.38 66.9% 12.6% -11.0% 1.3x 10.2x 1.1x 5.2x -47.2%LivePerson LPSN $196.86 $165.59 $79.44 75.2% 14.3% 21.7% 2.1x 14.6x 2.2x 19.3x 26.8%Medidata Solutions MDSO $359.39 $285.03 $126.62 60.5% 7.9% 35.8% 2.3x 28.4x n/a n/a n/aNetsuite N $849.83 $733.45 $163.68 67.4% -6.9% 25.5% 4.5x n/a 4.8x n/a -18.5%Omniture OMTR $1,102.53 $1,000.49 $335.51 58.0% 10.2% 55.8% 3.0x 29.1x 3.2x 17.1x -19.7%RightNow RNOW $399.09 $309.34 $144.69 66.2% 4.3% 13.0% 2.1x 49.5x 2.2x 259.9x -16.1%Salary.com SLRY $45.85 $34.86 $44.20 69.3% -37.9% 20.8% 0.8x n/a 0.8x n/a -42.9%Salesforce.com CRM $6,431.88 $6,037.82 $1,187.06 79.8% 10.7% 29.0% 5.1x 47.6x 5.6x 34.5x -7.4%SoundBite Communications SDBT $53.64 $16.62 $40.39 60.8% -1.0% -6.8% 0.4x n/a 0.4x n/a 28.5%SuccessFactors SFSF $679.97 $572.21 $134.90 72.8% -23.6% 58.5% 4.2x n/a 5.2x n/a 7.9%Taleo TLEO $571.31 $510.33 $191.86 65.4% 8.5% 35.0% 2.7x 31.1x 2.9x 15.4x -25.3%Vocus VOCS $325.43 $234.83 $82.06 81.3% 6.1% 20.1% 2.9x 47.2x 3.0x 14.2x -52.7%

Median: $571.31 $482.72 $144.69 67.4% 7.9% 24.1% 2.8x 30.1x 3.0x 22.1x -17.2%

TTM Revenue Growth 24.1%TTM EBITDA Growth 50.3%TTM Earnings Growth -72.1%Gross Profit Margin 67.4%EBITDA Margin 7.9%Net Income Margin -5.6%SG&A Expenses as a % of Total Revenue 53.8%R&D Expenses as a % of Total Revenue 13.3%








SEG SaaS Index Stock Market Return: Jan-Aug 2009

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SEG SaaS Index S&P 500 NASDAQ SEG SW Index

Category Performance

SEG Internet Index


SEG Internet Index: All Categories

Category Name Market Cap EV TTM RevenueTTM Gross

MarginTTM EBITDA

Margin

TTM Revenue Growth EV/ Revenue

EV/ EBITDA

Forward EV/ Revenue

Forward EV/

EBITDA


SEG Internet Index $275.43 $238.53 $146.94 59.7% 11.6% 1.7% 1.3x 11.4x 1.7x 9.1x -16.2% Advertising $656.24 $551.88 $265.54 57.4% 15.0% 4.6% 2.6x 11.7x 3.0x 9.5x -27.1% eCommerce & Portals $386.68 $393.18 $235.96 75.1% 7.1% -0.6% 2.3x 15.4x 2.3x 13.4x 0.5% Financial $164.32 $110.04 $54.54 60.8% 11.8% 2.4% 2.0x 11.6x 2.0x 8.3x -11.7% Networking & Connectivity $149.48 $131.58 $220.45 38.7% 12.1% -0.9% 0.7x 4.6x 0.8x 4.2x -9.0% New Media $340.74 $200.02 $104.61 56.8% 11.0% -4.1% 2.1x 19.2x 2.2x 9.1x -24.6% Search Engine $11,424.70 $10,933.70 $545.87 61.5% 39.6% 13.6% 4.7x 13.6x 5.1x 11.8x -19.0%




Copyright © 2009 by Software Equity Group, L.L.C., All Rights Reserved September 2009 Monthly Flash Report




SEG Internet Index Stock Market Return: Jan-Aug 2009

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SEG Internet Index S&P 500 NASDAQ SEG SW Index

SEG Internet Index Category: Advertising


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


Autobytel Inc. ABTL $27.56 $0.80 $58.79 34.3% -18.7% -27.0% n/a n/a n/a n/a -47.9%Baidu.com, Inc. BIDU $11,424.70 $10,933.70 $545.87 69.6% 43.6% 52.6% 20.0x 46.0x 23.6x 50.9x 5.2%comScore Inc. SCOR $419.16 $345.66 $124.25 68.3% 12.4% 20.9% 2.8x 22.5x 2.9x 13.7x -31.8%Google Inc. GOOG $146,151.47 $126,807.47 $22,274.18 61.5% 39.6% 13.6% 5.7x 14.4x 5.8x 13.7x -0.3%InfoSpace, Inc. INSP $285.93 $85.85 $159.05 42.2% 5.9% 3.7% 0.5x 9.2x 0.6x 3.5x -30.8%LookSmart, Ltd. LOOK $20.03 -$7.02 $56.84 38.7% -7.8% -6.7% n/a n/a n/a n/a -63.9%Marchex Inc. MCHX $154.83 $126.12 $119.62 56.0% 9.9% -17.5% 1.1x 10.6x 0.9x 3.9x -62.0%SINA Corporation SINA $1,614.60 $1,149.33 $372.04 58.0% 21.8% 39.8% 3.1x 14.2x 3.1x 10.7x -29.6%Sohu.com Inc. SOHU $2,339.14 $1,833.96 $485.07 75.6% 43.2% 59.7% 3.8x 8.7x 4.3x 9.8x -19.0%Tucows Inc. TCX $37.33 $34.08 $79.42 29.5% 6.3% 5.6% 0.4x 6.8x 0.4x 5.7x 14.6%ValueClick, Inc. VCLK $893.32 $758.11 $563.56 66.7% 17.6% -11.7% 1.3x 7.7x 1.2x 4.7x -20.5%Yahoo! Inc. YHOO $20,503.53 $16,733.22 $6,745.75 56.8% 19.5% -6.5% 2.5x 12.7x 3.1x 9.1x -24.6%

Median: $656.24 $551.88 $265.54 57.4% 15.0% 4.6% 2.6x 11.7x 3.0x 9.5x -27.1%









SEG Internet: Advertising Stock Market Return: Jan-Aug 2009

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S&P 500 NASDAQ SEG SW Index SEG Internet: Advertising

SEG Internet Index Category: eCommerce and Portals


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


1-800-FLOWERS.COM, Inc. FLWS $196.11 $259.40 $713.95 39.4% 4.8% -22.3% 0.4x 7.6x 0.3x 7.7x -49.7%Amazon.com, Inc. AMZN $35,058.41 $31,955.41 $20,509.00 22.6% 4.6% 19.7% 1.6x 33.9x 1.7x 24.8x 0.5%Bluefly, Inc. BFLY $21.06 $21.54 $86.96 36.9% -6.3% -9.8% 0.2x n/a 0.2x n/a 848.7%Digital River Inc. DRIV $1,362.43 $1,020.85 $391.71 85.3% 24.8% 2.7% 2.6x 10.5x 2.6x 9.5x -19.3%eBay Inc. EBAY $28,569.52 $25,954.70 $8,271.96 72.1% 32.3% -2.2% 3.1x 9.7x 3.0x 8.2x -11.2%Expedia, Inc. EXPE $6,649.08 $6,699.21 $2,859.63 78.9% 21.8% -1.7% 2.3x 10.7x 2.3x 8.9x 30.5%GSI Commerce, Inc. GSIC $916.26 $1,058.52 $961.83 59.3% 7.1% 11.7% 1.1x 15.6x 1.1x 13.4x 8.0%InsWeb Corp. INSW $11.97 $6.20 $33.17 100.0% -8.8% -14.5% 0.2x n/a n/a n/a -59.5%Internet Brands, Inc INET $326.96 $265.24 $100.59 77.9% 31.5% 1.0% 2.6x 8.4x 2.5x 7.5x 4.3%Liquidity Services, Inc. LQDT $299.72 $238.53 $243.73 47.5% 7.2% -0.6% 1.0x 13.5x 0.9x 9.2x -0.6%LiveDeal, Inc. LIVE $9.80 $0.71 $18.42 72.4% -16.1% -26.3% n/a n/a n/a n/a -26.9%LoopNet, Inc. LOOP $275.43 $203.47 $82.81 86.2% 29.5% 2.5% 2.5x 8.3x 2.4x 5.2x -25.0%Market Leader, Inc. LEDR $45.35 -$9.86 $29.52 100.0% -25.6% -37.6% n/a n/a n/a n/a -33.3%Mercadolibre, Inc. MELI $1,387.64 $1,355.08 $146.94 79.7% 31.2% 30.0% 9.2x 29.6x 9.8x 33.4x 1.9%Move, Inc. MOVE $446.40 $511.11 $228.20 78.6% 5.6% -8.5% 2.2x 40.3x 2.1x 22.9x 7.0%NetEase.com, Inc. NTES $5,434.63 $4,525.43 $472.21 80.7% 63.0% 22.1% 9.6x 15.2x 10.1x 15.0x 60.8%OpenTable, Inc. OPEN $611.42 $548.08 $61.11 68.0% 11.4% n/a 9.0x 78.5x n/a n/a n/aOverstock.com, Inc. OSTK $284.35 $275.26 $806.23 18.5% 0.8% -4.7% 0.3x 40.4x 0.3x 21.7x -41.1%priceline.com Incorporated PCLN $6,509.04 $6,267.06 $2,033.45 50.9% 18.2% 21.8% 3.1x 17.0x 3.4x 17.6x 65.6%Travelzoo, Inc. TZOO $198.81 $182.98 $86.33 94.7% 6.6% 5.6% 2.1x 32.2x 2.3x 79.3x 54.4%

Median: $386.68 $393.18 $235.96 75.1% 7.1% -0.6% 2.3x 15.4x 2.3x 13.4x 0.5%

TTM Revenue Growth -0.6%TTM EBITDA Growth -2.5%TTM Earnings Growth -22.9%Gross Profit Margin 75.1%EBITDA Margin 7.1%Net Income Margin -0.2%SG&A Expenses as a % of Total Revenue 45.7%R&D Expenses as a % of Total Revenue 10.0%


Levered FCF Margin 5.2%Cash from Operations Growth (YoY) -0.1%Cash from Investing Growth (YoY) -34.3%Cash from Financing Growth (YoY) 48.1%Levered FCF Growth (YoY) -29.3%





Income Statement Analysis (Median) SEG Internet: eCommerce & Portals Stock Market Return: Jan-Aug 2009

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SEG Internet: eCommerce and Portals S&P 500 NASDAQ SEG SW Index

SEG Internet Index Category: Financial


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


Bankrate Inc. RATE $538.06 $482.97 $153.56 60.8% 26.5% 15.7% 3.1x 11.9x 2.9x 8.3x -11.7%Banks.com, Inc BNX $4.70 $7.56 $8.76 66.4% -3.8% -51.2% 0.9x n/a n/a n/a -10.0%China Finance Online Co. Ltd. JRJC $210.66 $110.04 $54.54 83.3% 11.8% 30.1% 2.0x 17.2x 2.0x 4.8x -49.0%Online Resources Corp. ORCC $164.32 $298.59 $152.32 48.9% 17.1% 2.4% 2.0x 11.4x 1.9x 9.3x -37.2%Track Data Corp. TRAC $10.24 $8.54 $28.93 39.6% 7.9% -10.4% 0.3x 3.7x n/a n/a 223.0%

Median: $164.32 $110.04 $54.54 60.8% 11.8% 2.4% 2.0x 11.6x 2.0x 8.3x -11.7%



Levered FCF Margin 9.6%Cash from Operations Growth (YoY) 48.2%Cash from Investing Growth (YoY) 58.2%Cash from Financing Growth (YoY) -203.1%Levered FCF Growth (YoY) n/a





Income Statement Analysis (Median) SEG Internet: Financial Stock Market Return: Jan-Aug 2009

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SEG Internet: Financial S&P 500 NASDAQ SEG SW Index

SEG Internet Index Category: Networking and Connectivity


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


Delta Three, Inc. DDDC $15.83 $13.69 $19.94 29.0% -13.6% -18.1% 0.7x n/a n/a n/a 69.2%EarthLink Inc. ELNK $883.24 $508.60 $831.56 48.1% 32.0% -23.6% 0.6x 1.9x 0.5x 1.7x -10.7%Internap Network Services Corp. INAP $153.19 $121.98 $257.91 38.1% 11.7% 4.7% 0.5x 4.0x 0.5x 3.5x -2.3%Internet Gold Golden Lines Ltd. IGLD $193.77 $337.24 $319.89 30.8% 20.9% 6.3% 1.1x 5.1x 1.1x 4.8x 32.2%Internet Initiative Japan Inc. IIJI $480.43 $531.64 $743.73 19.6% 12.8% -0.3% 0.7x 5.6x n/a n/a -7.2%iPass Inc. IPAS $90.97 $20.89 $182.99 39.3% 2.8% -5.7% 0.1x 4.1x n/a n/a -35.7%Keynote Systems Inc. KEYN $145.78 $89.81 $81.43 48.0% 12.6% 10.5% 1.1x 8.8x 1.2x 11.4x -28.2%Sify Technologies Limited SIFY $113.50 $141.18 $124.77 40.8% -5.1% -1.5% 1.1x n/a n/a n/a -30.6%

Median: $149.48 $131.58 $220.45 38.7% 12.1% -0.9% 0.7x 4.6x 0.8x 4.2x -9.0%

TTM Revenue Growth -0.9%TTM EBITDA Growth 6.6%TTM Earnings Growth -65.7%Gross Profit Margin 38.7%EBITDA Margin 12.1%Net Income Margin -5.6%SG&A Expenses as a % of Total Revenue 27.2%R&D Expenses as a % of Total Revenue 5.0%


Levered FCF Margin 4.1%Cash from Operations Growth (YoY) 10.0%Cash from Investing Growth (YoY) -78.7%Cash from Financing Growth (YoY) 82.4%Levered FCF Growth (YoY) -7.0%





Income Statement Analysis (Median) SEG Internet: Networking & Connectivity Stock Market Return: Jan-Aug 2009

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SEG Internet: Networking & Connectivity S&P 500 NASDAQ SEG SW Index

SEG Internet Index Category: New Media


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


Inuvo, Inc. INUV $18.34 $24.74 $44.91 32.0% 1.2% -7.9% 0.6x 46.2x n/a n/a -46.2%RealNetworks, Inc. RNWK $477.14 $118.01 $581.10 56.4% -10.9% -3.5% 0.2x n/a 0.2x n/a -46.6%TechTarget, Inc. TTGT $268.00 $200.02 $93.88 69.4% 11.0% -10.6% 2.1x 19.3x 1.9x 9.1x -10.8%The Knot, Inc. KNOT $340.74 $264.52 $104.61 80.5% 13.2% 2.9% 2.5x 19.2x 2.5x 15.3x 10.9%TheStreet.com, Inc. TSCM $78.05 $13.52 $66.98 51.0% 2.9% -4.1% 0.2x 6.9x 0.2x 1.6x -64.1%WebMD Health Corp. WBMD $1,922.16 $1,675.28 $405.02 64.3% 17.5% 15.9% 4.1x 23.7x 4.4x 17.8x 3.9%Yahoo! Inc. YHOO $20,503.53 $16,733.22 $6,745.75 56.8% 19.5% -6.5% 2.5x 12.7x 3.1x 9.1x -24.6%

Median: $340.74 $200.02 $104.61 56.8% 11.0% -4.1% 2.1x 19.2x 2.2x 9.1x -24.6%

TTM Revenue Growth -4.1%TTM EBITDA Growth -39.0%TTM Earnings Growth -98.5%Gross Profit Margin 56.8%EBITDA Margin 11.0%Net Income Margin -1.8%SG&A Expenses as a % of Total Revenue 46.8%R&D Expenses as a % of Total Revenue 18.9%








SEG Internet: New Media Stock Market Return: Jan-Aug 2009

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SEG Internet: New Media S&P 500 NASDAQ SEG SW Index

SEG SaaS Index


MarginTTM EBITDA

Margin


Forward EV/ Revenue

Forward EV/ EBITDA


Athenahealth ATHN $1,351.17 $1,266.32 $165.64 58.1% 13.2% 41.5% 7.6x 57.7x 9.2x 58.3x 24.7%Concur CNQR $1,720.41 $1,478.61 $240.33 69.5% 24.7% 24.1% 6.2x 24.9x 6.9x 25.8x -19.5%Constant Contact CTCT $589.59 $482.72 $107.40 71.3% 2.6% 57.2% 4.5x 174.5x 5.6x 128.3x 21.8%DealerTrack TRAK $812.89 $634.16 $228.79 50.6% 11.0% -8.9% 2.8x 25.1x 2.6x 14.1x 9.4%DemandTec DMAN $239.93 $171.94 $76.50 68.1% -4.0% 15.8% 2.2x n/a 2.3x 24.9x -18.3%Kenexa KNXA $276.28 $229.29 $177.38 66.9% 12.6% -11.0% 1.3x 10.2x 1.1x 5.2x -47.2%LivePerson LPSN $196.86 $165.59 $79.44 75.2% 14.3% 21.7% 2.1x 14.6x 2.2x 19.3x 26.8%Medidata Solutions MDSO $359.39 $285.03 $126.62 60.5% 7.9% 35.8% 2.3x 28.4x n/a n/a n/aNetsuite N $849.83 $733.45 $163.68 67.4% -6.9% 25.5% 4.5x n/a 4.8x n/a -18.5%Omniture OMTR $1,102.53 $1,000.49 $335.51 58.0% 10.2% 55.8% 3.0x 29.1x 3.2x 17.1x -19.7%RightNow RNOW $399.09 $309.34 $144.69 66.2% 4.3% 13.0% 2.1x 49.5x 2.2x 259.9x -16.1%Salary.com SLRY $45.85 $34.86 $44.20 69.3% -37.9% 20.8% 0.8x n/a 0.8x n/a -42.9%Salesforce.com CRM $6,431.88 $6,037.82 $1,187.06 79.8% 10.7% 29.0% 5.1x 47.6x 5.6x 34.5x -7.4%SoundBite Communications SDBT $53.64 $16.62 $40.39 60.8% -1.0% -6.8% 0.4x n/a 0.4x n/a 28.5%SuccessFactors SFSF $679.97 $572.21 $134.90 72.8% -23.6% 58.5% 4.2x n/a 5.2x n/a 7.9%Taleo TLEO $571.31 $510.33 $191.86 65.4% 8.5% 35.0% 2.7x 31.1x 2.9x 15.4x -25.3%Vocus VOCS $325.43 $234.83 $82.06 81.3% 6.1% 20.1% 2.9x 47.2x 3.0x 14.2x -52.7%

Median: $571.31 $482.72 $144.69 67.4% 7.9% 24.1% 2.8x 30.1x 3.0x 22.1x -17.2%

TTM Revenue Growth 24.1%TTM EBITDA Growth 50.3%TTM Earnings Growth -72.1%Gross Profit Margin 67.4%EBITDA Margin 7.9%Net Income Margin -5.6%SG&A Expenses as a % of Total Revenue 53.8%R&D Expenses as a % of Total Revenue 13.3%








SEG SaaS Index Stock Market Return: Jan-Aug 2009

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SEG SaaS Index S&P 500 NASDAQ SEG SW Index


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