Private Equity Transaction Structures, continued… - Security ...

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Copyright ©
2011
Holland & Knight LLP All Rights Reserved


Copyright ©
2011
Holland & Knight LLP All Rights Reserved


Copyright ©
2011
Holland & Knight LLP All Rights Reserved


Legal Issues Associated with

Cyber Security M&A

William J. Mutryn

Co
-
Chair

Mergers
& Acquisitions Practice
Group

Holland & Knight LLP


October 25, 2011

(703
)
720
-
8069

william.mutryn@hklaw.com

Copyright ©
2011
Holland & Knight LLP All Rights Reserved


Global

law

firm

with

nearly

1
,
000

attorneys

in

17

U
.
S
.

offices

and

several

international

offices


Mid
-
Atlantic

Region
:

H&K’s

largest

region

with

roughly

250

attorneys

and

offices

in

Washington

and

Tysons

Corner


Corporate,

M&A

and

Securities

Group
:

25

attorneys

in

the

Mid
-
Atlantic

Region

and

150

nationally

focusing

on

serving

the

middle

market

companies

in

M&A

transactions,

securities,

finance

and

corporate

governance

Represented

parties

in

approximately

100

M&A

transactions

involving

Government

Contractor,

Defense

and

Security

companies

over

the

last

4

years,

including

25

transactions

in

2011



approximately

25
%

of

all

government

contractor

transactions

Experienced

attorneys

in

tax,

employee

benefits,

government

contracts,

intellectual

property,

environmental,

real

estate,

employment

and

antitrust

to

perform

M&A

transactions

Strong

direct

experience

in

representing

cyber

security

firms,

including

companies

that

serve

the

intelligence

community
.

See,

List

of

H&K’s

Representative

Transactions

at

the

end

of

this

presentation


3

Holland & Knight LLP

Copyright ©
2011
Holland & Knight LLP All Rights Reserved




4


Broad array of buyers, including: defense firms, technology
firms, private equity sponsors, diversified firms and foreign firms


Favorable financing terms and cash availability


Perception of a strong

growth market in cyber security that is still
evolving


Buyers seeking

to acquire:


Technology


Products


Service capabilities


Customer relationships


Long
-
term contracts


Management talent




The Current M&A Environment

Copyright ©
2011
Holland & Knight LLP All Rights Reserved


The Current M&A Environment



5


Robust Activity


quest for growth by Purchasers, desire for
liquidity by Sellers and favorable tax rates.
See list of recent
cyber security transactions at the end of this presentation (list
provided by
KippsDeSanto

& Co.)


Purchasers are VERY PARTICULAR


seeking the right deal
at the right price


Rigorous due diligence results in challenges for deals to be
completed on LOI terms


Multiple tiers of valuation ranges for selling companies; cyber
security technology and products, higher level cyber security
services to homeland security and intelligence agencies are
in the highest valuation range





Copyright ©
2011
Holland & Knight LLP All Rights Reserved


The Current M&A Environment



6


Lower

level

IT services are in less demand and sell for lower
valuations


Focus of Purchasers is shifting to products or mission critical or
technology
-
enhanced products services with strong margins and
growth potential


Price multiples for attractive Targets often exceed public
valuation multiples


Valuation multiples (EV divided TTM Adjusted EBITDA) for
higher end cyber security services firms often in the range of 10
to 12x. For firms with unique intellectual property or products,
multiples can be higher, sometimes by considerable amounts



Copyright ©
2011
Holland & Knight LLP All Rights Reserved


Key Factors Affecting M&A Transaction Terms



7


Competitive demand for Target,
e.g.
, auction process vs.
single purchaser


Risk tolerance and historical practices of particular
Purchaser


Composition of Seller group


Nature and magnitude of perceived future business and
legal risks


Overall Target preparation and compliance posture


Negotiation process


Copyright ©
2011
Holland & Knight LLP All Rights Reserved


Trends in M&A Transactions



8

Extensive Negotiation of a More
-
Detailed Letters of Intent


Frequently follows some due diligence by Purchaser and
management briefing by Target


Often part of a process managed by investment bankers


Items customarily addressed:


Tax and corporate structure, enterprise value and
assumptions behind purchase price


Purchase price and type of consideration


Escrow or holdback


Working capital requirements


Principal closing conditions




Copyright ©
2011
Holland & Knight LLP All Rights Reserved


Trends in M&A Transactions



9

Letter of Intent/Term Sheet, continued…


Earn
-
out structure, if any


Non
-
competes and key employee retention


Due diligence process


Exclusive negotiation period


Indemnity caps, baskets, minimum claims, survival periods
and materiality scrape sometimes negotiated


Exclusivity Period may be staged based on completion of
diligence, financing commitment and distribution of draft
documents


Sellers have strong interests to avoid future surprises on major
terms and prefer to negotiate prior to exclusivity



Copyright ©
2011
Holland & Knight LLP All Rights Reserved


Trends in M&A Transactions



10

Rigorous Sophisticated Due Diligence by Prospective
Purchasers:


Revenue waterfall


Backlog and pipeline


Contract terms


Margin sustainability and adequacy of business infrastructure


Customer relationships and re
-
compete risk


Key employee skills and employment continuity


Taxes: income, foreign, sales and use



Copyright ©
2011
Holland & Knight LLP All Rights Reserved


Trends in M&A Transactions



11

Purchaser Due Diligence, continued…


Efficacy of 338(h)(10) or similar elections


Compliance related matters:


Infringement


Employment classification


Employee benefits


Export controls


FCPA


Government procurement regulations (if applicable)


Capitalization


Intellectual Property


data rights, ownership, pricing,
competitive position


IT system adequacy and security


Copyright ©
2011
Holland & Knight LLP All Rights Reserved


Trends in M&A Transactions



12

Escrow and Other Protections for Purchaser from Post
-
Closing Losses at Historical Levels


Because of sophisticated diligence many Purchasers are better able
to evaluate risks of claims against target companies


Escrows


generally in the range of 5
-
20% of purchase price (with
average of 10%) and held for 12
-

24 months to secure indemnity
claims


Set
-
off Rights if subordinated notes or earn
-
outs are used as
consideration


Often a separate escrow to secure working capital deficiencies or
some agreements provide for no upward adjustment based on
estimated working capital at closing


Holdbacks are less frequent than escrows

Copyright ©
2011
Holland & Knight LLP All Rights Reserved


Trends in M&A Transactions



13

Survival Periods for Representations, Warranties and
Covenants


General Reps and Warranties


1 to 3 years; usually at
least one audit cycle


Fundamental reps, including capitalization, authority, title,
brokers, absence of debt


indefinite or statute of
limitations


Tax, ERISA, Environmental


30 to 60 days past statutes
of limitations


IP, Regulatory and Government Contracts


as negotiated:
could be same as general, 3 to 5 years, or statute of
limitations

Copyright ©
2011
Holland & Knight LLP All Rights Reserved


Trends in M&A Transactions



14

Survival Periods, continued…


Pre
-
closing covenants


indefinite or same as general
representations and warranties


Post
-
closing covenants and special indemnities


indefinite
or statute of limitation; sometimes special indemnities have
separate survival periods


ESOP
-
owned Target or widely
-
held Target in competitive
auction


reps and warranties survive until escrow/holdback
released, except for Fundamental


Public Target


representations and warranties generally do
not survive closing


Copyright ©
2011
Holland & Knight LLP All Rights Reserved


Trends in M&A Transactions



15

Indemnification Provisions


Sellers


typically joint and several, sometimes several (if limited
number of Sellers); Widely
-
held or ESOP
-
owned


indemnification
usually limited to escrow or holdback


Cap


typically 10% to 30% of purchase price for general
representations based on circumstances


Potential exclusions from cap and/or basket: capitalization,
authority, title, breach of covenants, fraud, willful misconduct, tax,
ERISA, environmental, ongoing litigation/investigation/claims,
certain

regulatory compliance matters,
e.g.,

FCPA,
special
indemnities; cap for these items is negotiated but can be as high
as the purchase price



Copyright ©
2011
Holland & Knight LLP All Rights Reserved


Trends in M&A Transactions



16

Indemnification Provisions, continued…


Basket


negotiated amount (generally 0.25% to 1.00% of
purchase price)


deductible or first dollar (tipping basket);
split basket, (
i.e
., part deductible and part first dollar
becoming more frequent


Minimum claim size sometimes negotiated


Special indemnities for discovered risks are often included

Copyright ©
2011
Holland & Knight LLP All Rights Reserved


Trends in M&A Transactions



17

Continued Emphasis on Employee Retention


Many Purchasers require as a closing condition that
key employees of Target execute retention or
employment agreements and a percentage of other
employees sign standard employee agreements


Retention or bonus agreements generally contain
stay
-
bonus provisions plus non
-
solicitation covenants
with respect to customers and employees

Copyright ©
2011
Holland & Knight LLP All Rights Reserved


Trends in M&A Transactions



18

Employee Retention, continued…


Highest level key employees may be required to sign
employment agreements as a closing condition,
particularly if Purchaser is private equity firm or small or
mid cap strategic


Private equity Purchasers may require or encourage
purchase of equity by key managers


Strategic Purchasers often grant stock options or
restricted stock to key employees

Copyright ©
2011
Holland & Knight LLP All Rights Reserved


Trends in M&A Transactions



19

Selective Use of Earn
-
Outs

Earn
-
outs


used by selected Purchasers if extraordinary
growth projected, set
-
aside contracts or to bridge valuation gap


More widespread use by private equity and small and mid
-
tier strategic buyers willing to pay upside if financial
projections are achieved or key contracts are maintained or
migrated


Can be event
-
based or performance
-
based; usually no
longer than 2 years from closing


Performance
-
based earn
-
outs based on revenues, gross
profits, contribution margin or EBITDA


Earn
-
outs used less frequently by strategic buyers that
prefer near
-
term integration of Target

Copyright ©
2011
Holland & Knight LLP All Rights Reserved


Trends in M&A Transactions



20

Use of Creative Tax Structures to Achieve Step Up in Basis
and Deferral of Rollover Equity


Many Purchasers attribute value to availability of step
-
up in
basis of Target’s assets from IRS Section 338(h)(10) or 754
election


In transaction with rollover equity, creative tax structures
have evolved to enable tax deferred treatment of rollover
equity, in some cases even where there is a Section
338(h)(10) or 754 election


Careful tax examination by Sellers of effects of Section
338(h)(10) election and installment sales treatment required

Copyright ©
2011
Holland & Knight LLP All Rights Reserved


Trends in M&A Transactions



21

Continued Importance of Target’s Net Working Capital or
Tangible Net Assets At Closing


Usually determined based on cash
-
free, debt
-
free net working
capital of business over an agreed period before closing


Some Purchasers seek to exclude or limit deferred tax assets


Some Purchasers require an adjustment if Accounts Receivable
not collected within an agreed time


Reserves and deferred revenue to be in accordance with GAAP


Separate escrow or holdback to serve as payment source if a
deficiency


Customary adjustment mechanisms:


Both upward and downward;


Downward only; or


No adjustment if within range



Copyright ©
2011
Holland & Knight LLP All Rights Reserved


Trends in M&A Transactions



22

Private Equity Transaction Structures Continues to
Use Leverage and Investment by Sellers and Key
Employees


Increased availability of senior and mezzanine debt in
2011 vs. last 2 years


Consideration may consist of:


Cash


Subordinated notes


Rollover equity by sellers


Earn
-
outs





Copyright ©
2011
Holland & Knight LLP All Rights Reserved


Trends in M&A Transactions



23

Private Equity Transaction Structures, continued…


Opportunity for “2 Bites at the Apple” by Sellers and
equity appreciation by key executives


Subordinated Notes


payment terms and
subordination provisions are heavily negotiated items


Rollover Equity


usually
parri

passu

to or one level
behind sponsor and subject to shareholders
agreement


Management fees and transaction fees paid to
sponsor



Copyright ©
2011
Holland & Knight LLP All Rights Reserved


Trends in M&A Transactions



24

Suggestions to Potential Sellers:


Conduct extensive preparation


Sellers should invest to
prepare for every diligence question, including S Corp
compliance, revenue waterfalls, contracts, compliance,
benefits, IP rights and capitalization


Be aware of customary terms


Provide stay incentives for key employees


Prioritize issues


Keep in mind the big picture

Copyright ©
2011
Holland & Knight LLP All Rights Reserved


Trends in M&A Transactions



25

Conclusions:


Prevailing trends can be helpful to provide guidance in
formulating party’s negotiating strategy


Resulting terms reflect the particular circumstances,
bargaining power and practices of the parties involved


Experienced financial, legal and accounting advisors can
assist in developing creative compromises

Copyright ©
2011
Holland & Knight LLP All Rights Reserved


List of Recent Holland & Knight

Representative Transactions



26

Acquiror

Target

Month/Year

Type of
Transaction

Iron Bow Technologies, LLC’s
Senior Management*

Iron Bow Technologies, LLC

09/11

Management Buyout

CACI International Inc.

Paradigm Holdings, Inc.*

09/11

Merger

Computer Sciences Corporation
*

Maricom Systems, Inc.

08/11

Stock Purchase

GTSI Corp.*

Information Systems Consulting
Group, Inc.

08/11

Stock Purchase

The Boeing Company

Solutions Made Simple, Inc.*

08/11

Stock Purchase

General Dynamics Government
Systems Corporation

Network Connectivity Solutions,
Corp.*

07/11

Stock Purchase

Chemonics International, Inc.
Employee Stock Ownership Plan

Chemonics International, Inc.*

07/11

Stock Purchase

Dynamics Research Corporation*

High Performance Technologies, Inc.

06/11

Merger

SFW Capital Partners

Spectro, Inc.*

06/11

Stock Purchase

TASC, Inc.

TexelTek, Inc.*

06/11

Stock Purchase

Monument Capital Group*

Persistent Sentinel LLC

05/11

Asset Purchase

National Security Partners, Inc.

Point One, L.L.C. and FuGen, Inc.*

05/11

Asset Purchase

FedCap Partners, LLC*

Global Resource Solutions, Inc.

05/11

Minority Equity
Purchase

* =
H&K Client in Transaction

Copyright ©
2011
Holland & Knight LLP All Rights Reserved




27

Acquiror

Target

Month/Year

Type of
Transaction

FedCap Partners, LLC*

Global Analytic Information
Technology Services, LLC

03/11

Minority Equity
Purchase

ManTech International Corporation

TranTech, Inc.*

02/11

Stock Purchase

ManTech International Corporation

MTCSC Inc.*

12/10

Asset Purchase

Pragmatics, Inc.

Innovative Solutions International*

12/10

Stock Purchase

Computer Sciences Corporation
(“CSC”)*

CenTauri Solutions, LLC

12/10

Merger

Global Defense Technology Systems,
Inc.

Signature Government Solutions,
LLC's*

12/10

Equity Purchase

KeyW Corporation

Everest Technology Solutions, Inc.*

12/10

Stock Purchase

Arlington Capital Partners*

White Oak Technologies, Inc.

11/10

Merger

ManTech International Corp.

QinetiQ North America's Security
and Intelligence Solutions Unit*

10/10

Asset Purchase

Computer Sciences Corporation*

Vulnerability Research Labs

10/10

Asset Purchase

CGI Group, Inc.*

Stanley, Inc.

8/10

Merger

List of Recent Holland & Knight

RepresentativeTransactions

* =
H&K Client in Transaction

Copyright ©
2011
Holland & Knight LLP All Rights Reserved




28

Acquiror

Target

Month/Year

Type of
Transaction

Applied Signal Technology, Inc.

Seismic, LLC*

4/10

Equity Purchase

KeyW Corporation

The Analysis Group, LLC*

2/10

Stock Purchase

SRA International, Inc.*

Perrin Quarles Associates, Inc
.

1/10

Stock Purchase

General Dynamics C4 Systems, Inc.

Ascend Intelligence LLC*

1/10

Asset Purchase

DynCorp International LLC

Casals & Associates, Inc.*

1/10

Stock Purchase

Science Applications International
Corporation

Science, Engineering and
Technology Associates Corporation*

1/10

Merger

* =
H&K Client in Transaction

List of Recent Holland & Knight

RepresentativeTransactions

Copyright ©
2011
Holland & Knight LLP All Rights Reserved


29

Announce

Close

Acquiror

Target

10/04/11

Pending

International Business Machines Corp.
(NYSE:IBM)

Q1 Labs Inc.

10/04/11

Pending

McAfee, Inc.

NitroSecurity, Inc.

10/04/11

10/04/11

Avaya Inc.

Sipera Systems, Inc.

09/29/11

09/29/11

Ultra Electronics Holdings plc (LSE:ULE)

AEP Networks, Inc.

09/03/11

09/03/11

General Dynamics C4 Systems, Inc.

Innovative Security Systems, Inc. (dba
Argus Systems Group)

09/01/11

Pending

IBM Corporation

Algorithmics, Inc.

08/25/11

08/25/11

Verizon Communications

CloudSwitch

08/15/11

Pending

BIO
-
key International Inc. (OTCBB:BKYI)

S.I.C. Biometrics Inc.

08/05/11

08/05/11

Intergraph Corporation

Augusta Systems, Inc.

07/22/11

07/22/11

Google Inc. (
NasdaqGS:GOOG
)

Pittsburgh Pattern Recognition

05/12/11

06/06/11

Rambus

Inc. (
NasdaqGS:RMBS
)

Cryptography Research, Inc.

05/11/11

05/23/11

Thoma

Bravo, LLC

Tripwire, Inc.

05/05/11

05/05/11

Novacoast
, Inc.

Data Technique, Inc.

List of Recent Cyber Security Transactions

Compilation by
KippsDeSanto

& Co., an investment banking firm with strong experience in the cyber security
industry.

Copyright ©
2011
Holland & Knight LLP All Rights Reserved


30

Announce

Close

Acquiror

Target

05/04/11

05/02/11

Identive

Group, Inc. (
NasdaqGM:INVE
)

idOnDemand Inc.

05/03/11

07/08/11

RadiSys

Corporation (
NasdaqGS:RSYS
)

Continuous Computing Corporation

05/03/11

05/03/11

General Microsystems Inc.

RockFish Tek, Inc.

04/27/11

04/28/11

Polaris Software Lab Ltd. (BSE:532254)

IdenTrust, Inc.

04/04/11

04/04/11

RSA Security, Inc.

NetWitness

Corporation

03/21/11

03/21/11

Peer Media Technologies, Inc.

BayTSP
, Inc.

03/03/11

02/28/11

Imation Corp. (NYSE:IMN)

BeCompliant

Corporation

02/14/11

02/14/11

Quest Software Inc. (
NasdaqGS:QSFT
)

e
-
DMZ Security, LLC

02/11/11

02/11/11

NetSweeper
, Inc.

DeepNines
, Technology And Business
Assets

02/07/11

03/03/11

Corero

plc (AIM:CORO)

Top Layer Networks, Inc.

01/26/11

05/01/11

Cisco Systems, Inc. (
NasdaqGS:CSCO
)

Pari

Networks, Inc.

01/18/11

01/18/11

Solaria Fund

Lavasoft

AB, Anti
-
Spyware and
Antivirus Software Business

01/14/11

02/17/11

BAE Systems (Holdings) Ltd.

Norkom

Group Plc (ISE:N5OK)

01/14/11

01/14/11

VMware, Inc. (NYSE:VMW)

NeoAccel
, Inc.

01/12/11

Pending

SAP AG (DB:SAP)

SECUDE International AG Assets

Compilation by
KippsDeSanto

& Co., an investment banking firm with strong experience in the cyber security
industry.


List of Recent Cyber Security Transactions

Copyright ©
2011
Holland & Knight LLP All Rights Reserved


31

Announce

Close

Acquiror

Target

01/11/11

01/11/11

Intel Corporation (
NasdaqGS:INTC
)

Nordic Edge AB

01/10/11

02/28/11

Ameristar Network Inc. (OTCPK:AMWK)

SecurDigital, Inc.

01/10/11

01/10/11

Astaro

GmbH & Co. KG

100% stake in CoSoSys S.R.L. and 97%
in Mobile Software Solutions SRL

01/10/11

01/10/11

VASCO Data Security International, GmbH

DigiNotar B.V.

01/07/11

02/02/11

Ultra Electronics Defense, Inc.

3e Technologies International, Inc.

12/29/10

12/30/10

Sourcefire
, Inc.

Immunet Corporation

12/23/10

12/23/11

Management Buyout

Anonymizer, Inc.

12/22/10

03/21/11

BAE Systems plc

ETI A/S

12/06/10

12/06/10

Juniper Networks, Inc.

Altor Networks, Inc.

11/29/10

02/01/11

Trend Micro Inc.

Mobile Armor, Inc.

11/22/10

12/22/10

ManTech International Corp.

MTCSC Inc.,

11/21/10

12/22/10

Attachmate Corporation

Novell Inc. (
NasdaqGS:NOVL
)

11/09/10

11/30/10

AVG Technologies N.V.

DroidSecurity

TLV

11/04/10

11/04/10

Raytheon Company

Trusted Computer Solutions

11/01/10

11/01/10

Webroot Software, Inc.

Prevx

Limited

Compilation by
KippsDeSanto

& Co., an investment banking firm with strong experience in the cyber security
industry.


List of Recent Cyber Security Transactions

Copyright ©
2011
Holland & Knight LLP All Rights Reserved


32

Announce

Close

Acquiror

Target

10/25/10

10/25/10

Asknet

AG

Norman ASA

10/18/10

10/18/10

MarkMonitor
, Inc.

DtecNet Software ApS

09/29/10

Pending

[undisclosed buyer]

eSoft, Inc., Assets Associated with
UTM Internet Security Appliance
Offerings

09/15/10

09/15/10

Microsemi

Corp.

Arxan

Defense Systems, Inc.

09/13/10

10/20/10

Hewlett
-
Packard Company

ArcSight
, Inc.

08/31/10

08/31/10

Qualys
, Inc.

Nemean

Networks, LLC

08/30/10

10/04/11

CA Technologies

Arcot

Systems, Inc.

08/24/10

08/24/10

Technology Nexus AB

PortWise

AB

08/23/10

09/29/10

Thoma

Bravo, LLC

LANDesk Software, Inc.

08/18/10

02/28/10

Intel Corporation

McAfee, Inc. (NYSE:MFE)

08/17/10

09/22/10

Hewlett
-
Packard Company

Fortify Software, Inc.

08/09/10

08/31/10

Tektronix Texas, LLC

Arbor Networks, Inc.

07/29/10

12/22/10

McAfee
Inc
.

tenCube

Pte

Ltd.

07/27/10

07/30/10

Juniper Networks, Inc.

SMobile Systems, Inc.

07/26/10

09/03/10

Commtouch
, Inc.

Command Software Systems, Inc.

Compilation by
KippsDeSanto

& Co., an investment banking firm with strong experience in the cyber security
industry.

List of Recent Cyber Security Transactions

Copyright ©
2011
Holland & Knight LLP All Rights Reserved


33

Announce

Close

Acquiror

Target

07/13/10

07/13/10

GFI Software

Sunbelt Software, Inc.

07/12/10

07/12/10

Quest Software GmbH

Völcker Informatik AG

07/07/10

07/29/10

Boeing Company

Narus, Inc.

07/04/10

07/04/10

SafetyWeb
, Inc.

Odojo, Inc.

07/01/10

07/20/10

IBM Corporation

BigFix
, Inc.

06/30/10

06/30/10

H&C Network Co. Ltd.

Initech

Co. Ltd.
(57% stake)

06/22/10

06/22/10

TrustWave

Holdings, Inc.

Breach Security, Inc.

06/07/10

06/07/10

Idera

Corporation

iDevFactory

06/03/10

06/03/10

Tibco Software, Inc.

Proginet

Corp.

06/02/10

07/23/10

Teachers' Private Capital; Thoma Bravo, LLC

SonicWALL
, Inc.

05/25/10

06/03/10

McAfee Inc.

Trust Digital, LLC

05/17/10

05/28/10

Harris Corporation

SignaCert
, Inc.

05/03/10

05/18/10

Apax Partners Worldwide LLP

Sophos

Plc
(70% stake)

Compilation by
KippsDeSanto

& Co., an investment banking firm with strong experience in the cyber security
industry.

List of Recent Cyber Security Transactions

Copyright ©
2011
Holland & Knight LLP All Rights Reserved


34

Announce

Close

Acquiror

Target

04/29/10

06/04/10

Symantec Corporation

PGP Corporation

04/07/10

04/07/10

Absolute Software Corporation

Phoenix Technologies Ltd.,
FailSafe

and Freeze Anti
-
Theft Assets

04/01/10

04/01/10

VeriSign, Inc.

TrustBearer

Labs, LLC

03/25/10

04/15/10

Options Media Group Holdings, Inc.

PhoneGuard
, Inc.

03/22/10

Pending

AVG Technologies CZ,
s.r.o
.

Square S.A.

03/03/10

03/03/10

TrustWave

Holdings, Inc.

Intellitactics, Inc.

02/26/10

02/26/10

AuthenTec
, Inc.

SafeNet Inc., Embedded Security
Solutions Division

02/26/10

02/17/10

RF Logics Inc

ME2 Security LLC

02/15/10

02/28/10

Cloudmark

Inc.

Bizanga Limited

02/11/10

02/11/10

Telenity
, Inc.

Construia

01/31/10

01/31/10

Raytheon Company

Compucat

Research Pty. Ltd.

01/29/10

01/29/10

WidePoint Corporation

VUANCE Inc. (Government Solutions
Division)

01/26/10

01/26/10

Ipswitch, Inc.

Dorian Software Creations, Inc.

01/19/10

02/01/10

CACI International, Inc.

SystemWare
, Inc.

01/14/10

02/05/10

SAIC, Inc.

CloudShield

Technologies, Inc.

Compilation by
KippsDeSanto

& Co., an investment banking firm with strong experience in the cyber security
industry.

List of Recent Cyber Security Transactions

Copyright ©
2011
Holland & Knight LLP All Rights Reserved


35

Announce

Close

Acquiror

Target

01/12/10

01/22/10

Symantec Corporation

Gideon Technologies Inc.

01/12/10

01/12/10

iForem

Enmoda

Inc.

01/12/10

01/12/10

TrustWave

Holdings, Inc.

BitArmor

Systems Inc.

01/07/10

01/28/10

Motorola, Inc.

SecureMedia, Inc.

12/18/09

12/18/09

Healthcare of Today Inc

NuvoDigital Technology, Inc.

12/13/09

12/14/09

ActivIdentity

Corporation

CoreStreet

Ltd.

12/10/09

02/10/09

Microsoft Corporation

Sentillion

Inc

11/30/09

11/30/09

IBM Corporation

Guardium
, Inc.

11/23/09

01/11/10

NICE Systems Ltd

Orsus

(security management assets)

11/23/09

11/23/09

Check Point Software Technologies

FaceTime

Communications (application
database)

11/03/09

11/03/09

m86 Security

Finjan

10/27/09

12/04/09

Cisco Systems, Inc.

ScanSafe
, Inc.

Compilation by
KippsDeSanto

& Co., an investment banking firm
with strong experience in
the cyber security
industry.

List of Recent Cyber Security Transactions