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GE Capital Technology & Business Services

1Q10

Industry Research Monitor
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CONTENTS:
Industry Headlines/Macro Environment 1
Other Industry News & Developments 2
Technology Industry Financing Activity 7
Transaction Capabilities & Conference Calendars 9

Technology Industry Headlines Macro Environment
• Following a decline of 4.5% in 2009, IDC says worldwide 2009 was no doubt one of the most volatile on record for the
tech spending is on track to increase 3% in 2010. In the technology industry. The collapse in demand to finish 2008
United States, IT spending growth is forecast to under- followed through into 2009 until hitting bottom in the early
perform emerging economies but outperform most other part of the year. Since that bottom about a year ago, demand
developed regions. for technology infrastructure has shown a marked turnaround
with accelerating improvement through the end of 2009. Year-
• President Obama named Howard Schmidt as the new U.S. over-year growth is now commonplace albeit against weak
cybersecurity czar. Most recently, Schmidt served as comparisons. The 3rd and 4th quarters of 2010 will offer a
president of the Information Security Forum and arrives at more valid test of the durability of this IT spending recovery.
the White House with 40 years of experience including Not surprisingly, the confidence of senior executives in the IT
serving as the White House security advisor to George W. industry has also been on the upswing. Results of a survey
Bush, as well as long-held positions at eBay and Microsoft. of industry executives conducted by GE Capital late last year
showed that Tech CEOs were the most optimistic across all
• After a 2% drop in 2009, global retail consumer electronics industries with 77% of the respondents expecting growth in
sales are expected to be flat in 2010, according to the 2010, forecasting on average revenue growth of 10%.
Consumer Electronics Association. That follows growth of
14% in both 2007 and 2008, and 17% growth in 2006. IT Spending in U.S. – Strong acceleration to finish 2009
U.S. IT Equipment & Software Capex (1Q05 – 3Q09)
• Microsoft named Peter Klein as the company’s CFO 20
following the departure of Chris Liddell at the end of 2009. 15
Quarterly Change SAAR (%)

10
• Rackspace confirmed that a server in one of its data 5
centers was hit in a massive cyberattack that apparently
0
originated in China and targeted Google and at least 20
-5
other companies. The cyberattack aimed to steal
proprietary code and intellectual property. -10

-15
• Worldwide PC shipments topped 90 million units in Q4, -20
Source: Bureau of Economic Analysis
increasing 22.1% from a year ago, according to data from -25
Gartner. 05 05 05 05 06 06 06 06 07 07 07 07 08 08 08 08 09 09 09 09
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q

Michael H. Zimm, CFA
SVP, Senior Research Analyst
646-428-7015 • Michael.Zimm@ge.com

© Copyright 2010 General Electric Capital Corporation. All Rights Reserved.
GE Capital – Industry Research Monitor: Technology & Business Services 1Q10

• IBM is also buying National Interest Security, a privately
Software/IT Services held company intended to strengthen IBM’s position in
the public sector IT market.
Steady and reliable. Software and IT Services on average • Microsoft acquired Sentillion Inc., a privately held
remain the most resilient technology sectors to macro company specializing in software for the healthcare
headwinds. That being said, the growth in these sectors industry. Microsoft also acquired Opalis, a provider of
during 2010 may not keep pace with the rebound expected in datacenter process automation software.
the more severely depressed hardware sector. IDC’s most • Oracle acquired Silver Creek Systems, Inc. a provider of
recent constant currency forecast for 2010 calls for overall product data quality solutions.
global spending on software and IT services to be 2% and 3%, • Lawson Software acquired Healthvision Solutions, an
respectively compared to 5% growth in hardware. This application and services provider to the healthcare
subdued growth outlook for software and services spending industry for $160 million cash.
reflects a relatively higher base compared to hardware • BMC Software acquired privately held Phurnace Software,
coupled with the lower value of contracts signed in the past a developer of automation software.
year and continued caution toward new project-based • CA acquired privately held Oblicore, a developer of service
spending in mature economies. Nonetheless, within software level management software.
and services, we continue to observe positive momentum • TIBCO Software acquired privately held Foresight
around the recession-induced themes of improved efficiencies Corporation, a provider of transaction automation
via transformative architectures such as Virtualization, XaaS solutions and EDI productivity tools.
and Cloud Computing as well as solutions tied to security • VMware acquired Zimbra, a vendor of open-source email
and increasingly stringent regulatory oversight. and collaboration software, from Yahoo! Inc.
• Symantec acquired Gideon Technologies, a provider of
security content automation technology.
Strategic Updates • CACI International acquired SystemWare, Inc., a provider
of physical and cybersecurity solutions.
• Accenture suffered a legal defeat on all of the preliminary • SRA International, Inc. acquired privately held Perrin
issues in a case it is defending against British Gas’ parent Quarles Associates (PQA), Inc., specializing in
company, Centrica. Centrica is claiming approx. $300m in environmental program development and implementation
relation to the alleged failure of a customer billing system. for air quality and climate change.
• Computer Sciences entered into a 10-year master service • Informatica acquired Siperian for $130 million cash.
agreement with Zurich Financial Services. Siperian provides Master Data Management (MDM)
• Advent Software announced further expansion into the infrastructure technology.
Asia-Pacific region with the opening of a new office in • Unisys sold its health information management business
Beijing. to Molina Healthcare for $135 million cash.
• HP Enterprise Services entered into a seven-year • Digital River and Softonic, a European software download
infrastructure services agreement with Eli Lilly. site, announced a strategic partnership, which includes
• TeleCommunication Systems and Sybase agreed to settle Digital River acquiring a less than 15 percent ownership
two patent infringement lawsuits. stake in Softonic for $26m cash.
• The U.S. State Department awarded CGI Federal a 10-year
blanket purchase agreement with a ceiling of up to $395
million.
Management Changes
• McAfee Inc. and Facebook have announced a partnership
to provide additional security protection to the more than • SAP’s CEO Leo Apotheker resigned after his contract was
350 million Facebook users. not renewed. SAP will now be run by two co-CEOs who
• Microsoft will begin charging for its cloud services have been promoted internally: Bill McDermott, the
development platform Azure. company’s head of field organization, and Jim Hagemann
Snabe, head of product development.
• IBM Lotus GM Bob Picciano has been promoted to GM
Mergers & Acquisitions of all software sales at IBM. Alistair Rennie, previously vice
president of Lotus development and support, has taken
• IBM acquired privately held Guardium, a provider of real- over the IBM Lotus GM post.
time enterprise database monitoring and protection • Mischel Kwon resigned as director of the Homeland
technology. IBM also purchased privately held Lombardi, Security U.S. Computer Emergency Readiness Team and is
which makes software for streamlining product planning, moving to EMC’s RSA security division.
human resources, procurement and supply chain • CA has tapped board member William E. McCracken to be
management. the company’s new CEO and chairman.

2 © Copyright 2010 General Electric Capital Corporation. All Rights Reserved.
GE Capital – Industry Research Monitor: Technology & Business Services 1Q10

• The U.S. International Trade Commission ruled that Nvidia
Semi/Capital Equipment is violating three patents owned by Rambus.
• Samsung Electronics and Rambus announced an
Above average seasonality. According to data from the agreement settling all legal claims between them.
Semiconductor Industry Association (SIA), worldwide Samsung will also invest $200M in Rambus stock.
semiconductor sales during 2009 were $226.3 billion, down • Applied Materials announced that several of its
9% from 2008. The three-month moving average of sales in employees, including the former head of Applied Materials
December increased 29% from December 2008 but declined Korea, were arrested in South Korea. Applied said the
1.2% month-month from November. Sales in the final quarter arrests were related to a “criminal investigation into the
of 2009 were supported by healthy demand in a variety of alleged improper receipt and use of a customer’s
end markets including PCs, cell phones, and consumer confidential information.”
electronics. Following a strong finish to 2009, a return to • The U.S. Attorney for the District of Columbia announced
normal seasonal patterns suggests a modest slowdown in the that the owner of MVP Micro, Inc., has entered a guilty
first quarter of 2010. For all of 2010, unit sales of personal plea to the charge of trafficking in counterfeit
computers and cell phones, which account for approximately semiconductors.
60 percent of total semiconductor consumption, will grow in
the low-to-mid teens. A rebound in enterprise spending on
IT hardware will also add to the foundation of industry growth.
Mergers & Acquisitions
Overall, the SIA continues to expect global growth of
semiconductor sales to increase 10.2% and 8.4% in 2010 and • Applied Materials acquired Semitool for $364 million in an
2011, respectively. all-cash transaction.
• Semtech acquired Sierra Monolithics for $180m.
Given severe reductions in capex spending over the past two • DDi Corp. acquired Coretec Inc. for approx. $23.5m.
years, optimism for a strong rebound in demand for semi-cap • Broadcom acquired privately held Dune Networks for
equipment continues to build. Industry bellwethers such as approximately $178 million cash.
Intel (+20%), TSMC (+77%) and Texas Instruments (+40%) have • ON Semiconductor acquired California Micro Devices for
all announced large increases in their equipment capex an enterprise value of approx. $63 m.
spending plans for 2010. • Trident Microsystems acquired selected assets of the
television and set-top box business lines of NXP.
Powerful V-shaped recovery in semiconductor sales… • Broadcom acquired Teknovus for $123 million cash.
24 30% • Microchip Technology acquired Silicon Storage
Source: SIA
Technology for $2.85 a share in cash. The deal trumps a
Monthly Global Semi Sales $Bs

22 20%
previous agreement for SSTI to be acquired by Technology
10% Resources Holdings for $2.10 a share.
Y/Y % Change

20
0%
18
-10% Management Changes
16
Monthly Global -20%
Semiconductor Sales $B
14 -30% • Veeco Instruments Inc. named David Glass Chief Financial
Y/Y % Change
Officer. Glass replaces John Rein, who announced his
12 -40%
5 -06 -07 -08
retirement from Veeco last year.
-0 -09
D ec D ec D ec D ec D ec

N/A Semiconductor Capital Equipment Book-to-Bill
Seasonality beginning to exert pressure
Strategic Updates 1.60
Source: SEMI

• IBM launched the latest version of its Power processors, 1.40

which it claims will lay the foundation for companies’ green
1.20
IT efforts. The Power 7 chips, reportedly use a quarter
Monthly Book-to-Bill

of the energy used by the Power 6, but offer double the 1.00
Parity
performance.
• Intel cancelled its Larrabee graphics chip launch. 0.80 c

• The U.S. Federal Trade Commission filed suit against Intel
0.60
for allegedly using illegal tactics to shut out competitors
such as Advanced Micro Devices. 0.40
• An antitrust probe of Rambus was dropped by the E.U.
after the company pledged to cap royalty fees for DRAM 0.20
memory chip patents. -97 -98 -99 -00 -01 -02 -03 -04 -05 -06 -07 -08 09 10
J an J an J an J an J an J an J an J an J an J an J an J an J an- J an-

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GE Capital – Industry Research Monitor: Technology & Business Services 1Q10

Systems/Storage Strategic Updates
Consumer ahead of the enterprise. Publically traded systems • Hewlett-Packard and Microsoft said they would invest
and storage vendors generally reported typical seasonal $250M in a partnership to more tightly couple their
strength quarter-over-quarter during the recently reported software and hardware products, as rivals Oracle, IBM and
4th quarter of 2009. However, the results generally seemed a others remake themselves as one-stop shops for
bit lackluster on a year-over-year (constant currency) basis technology. HP and Microsoft said that the three-year
despite relatively easy comparisons. While consumer related agreement would involve an array of initiatives; all aimed
spending for PCs and related peripherals has been on the at helping businesses reduce some of the headaches of
upswing, systems manufactures continue to fight the setting up and operating data centers.
headwinds of constrained corporate capex budgets coupled • NetApp and Microsoft unveiled a formal technology
with the deflationary pressures of virtualization and collaboration designed to ensure that NetApp’s storage
commoditization in the data center. works well with Microsoft applications and its Hyper-V
virtualization technology.
While the hardware sector was hit the hardest during the • Oracle’s CEO Larry Ellison stated explicitly that Oracle will
recent downturn, the segment is now well positioned for focus Sun server sales on “high-value, high-performance”
growth from a low level as enterprises begin to reverse the applications such as private clouds and won’t compete
trend of extended lifecycles from severe underinvestment directly with Dell and HP.
over the past few years. The environment for leasing of • ioSafe has announced what it calls “the world’s first solid
IT assets should also be favorable as companies continue to state external hard drive built to protect data from building
look for ways to conserve cash outlays while maintaining collapse, fires, and floods.
leading edge capabilities. • Cisco, VMware and NetApp have signed a technology pact
to deliver new architectures for increasing data center
Several fundamental indicators confirm the optimistic views efficiency, flexibility and security. The agreement follows a
of OEM executives that the systems and peripherals sector is similar deal between EMC, Cisco and VMware to support
well into a recovery. The IPC North American printed circuit Cisco’s UCS strategy of bringing server, storage and
board book-to-bill ratio has been above parity (1.0) since May networking technologies into a single architecture on which
and stands at 1.04 as of December, down from a recent data centers can be built.
peak of 1.08 in September. While still comfortably positive, the • CommVault has added REST, a protocol that interfaces
book-to-bill ratio typically peaks in the Sep-Dec timeframe with multiple cloud storage vendors’ offerings, as a way to
and we would not be surprised to see it dip below parity for help its customers easily connect to public storage clouds.
several months prior to the next seasonal cycle upswing • QLogic has sued Emulex accusing it of false advertising,
expected in the middle of the year. The book-to-bill ratio leads unfair competition and trade libel.
sales in the PCB industry by an average of three to six months
and PCBs in turn lead sales of OEM equipment.
Mergers & Acquisitions
Printed Circuit Board Book-to-Bill
Eight consecutive months above parity • EMC Corporation acquired Archer Technologies, which
1.4 will be incorporated into its RSA division.
Source: IPC
• Dot Hill acquired Cloverleaf Communications Inc., a
privately held provider of advanced heterogeneous storage
virtualization and unified storage technologies for $12
million in cash and stock.
N.A. PCB Book-to-Bill Ratio

• Celestica acquired Invec Solutions, a provider of warranty
management, repair, and parts management services.

Management Changes
• Sun Microsystems chief executive officer Jonathan
Schwartz resigned his position in a Twitter post phrased in
the form of a haiku poem.
• NetApp announced the appointment of Christine Heckart
-99 eb-00 Feb-01 eb-02 eb-03 Feb-04 eb-05 eb-06 eb-07 eb-08 eb-09 Feb-10
Feb F F F F F F F F as its new Chief Marketing Officer.

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GE Capital – Industry Research Monitor: Technology & Business Services 1Q10

• Increasing competition between Cisco and HP has led to
Distribution Channels Cisco announcing that it will not renew its systems
integrator contract with HP. As a result, HP will no longer be
Riding a rising tide. Publically traded distributors generally a certified reseller or service partner of Cisco’s after
reported much better than expected financial results for the April 30.
December/January ending quarter and conveyed an ongoing • Ingram Micro has expanded its relationship with
sense of optimism amid stronger than normal seasonal Transcend Information to include the U.S.
trends, lean supply chain inventories and recovering IT • Blade Network Technologies announced that Bell Micro
spending. Channel management commentaries on overall will distribute Blade’s 10 Gigabit Ethernet RackSwitch
business conditions remain decidedly positive compared to product family in North America.
several quarters ago and strategies continue to reflect a • IBM said it will pass nearly all new midmarket software
transition from defense to offense. sales leads, valued up to $50,000, to its Authorized
Software resellers.
Overall revenue (excluding acquisitions) during the final • Avnet and Arrow will distribute Riverbed products in North
quarter of 2009 exhibited above average seasonal quarter- America for the first time.
over-quarter strength and more importantly showed year- • Oracle said it will rely on direct sales of Sun Microsystems
over-year growth for the first time since 3Q08. The overall server and storage hardware systems to large accounts,
stronger than expected revenue growth was magnified reversing Sun’s trend of selling more products through
by recent restructuring actions resulting in margin expansion channel partners. Oracle will continue to rely heavily on
and profit growth that outpaced top-line growth. Looking partners for sales to midmarket customers. But the
ahead to the 1st calendar quarter of 2010, channel players emphasis will be on working with resellers that provide
are expecting typical seasonal sequential declines in revenue integration services and other “specializations.”
albeit with a continuation of meaningful year-over-year • Cisco Capital announced an extensive, no interest
growth. financing promotion for Cisco products and services
($1,000 up to $250,000) sold through Cisco certified
resellers to U.S. small and medium-sized business.
Strategic Updates • Avnet Technology Solutions launched a suite of services
under its SolutionsPath program, all designed to help VARs
• Microsoft and Intuit are teaming up to make it easier for enhance their offering.
developers to build SMB-focused software-as-a-service • Tech Data has entered into an agreement with TechTurn
applications that integrate with QuickBooks. to offer hardware recycling and refurbishment to resellers.
• HP Financial Services has re-introduced a zero-percent
financing program for SMB customers. Qualifying
transactions for the program are between $1,500 and
Mergers and Acquisitions
$150,000 for 12 months.
• Avnet Technology Solutions has been selected to carry • Arrow Electronics acquired A.E. Petsche Company, a
Cisco’s data center products in the United States and provider of interconnect products to the aerospace and
Canada, including Cisco’s Unified Computing System blade defence markets.
server. Avnet joins specialty distributor Westcon Group • Datalink acquired reseller Incentra for $8.8m cash.
and broadline distributors Ingram Micro and Tech Data as • Presidio acquired Coleman Technologies. The combined
distributors of Cisco’s Unified Computing System. companies will create a solution provider with more than
• IBM Global Financing has signed a financing deal with $1.1 billion in revenue.
Advanced Micro Devices and its distributor network in • Autonomy Corp. acquired MicroLink LLC for $55 million in
China. In conjunction with this new factoring license, cash. MicroLink is an Autonomy reseller targeting U.S. state
IBM Factoring (China) Company Limited, entered into an and federal government accounts.
agreement with AMD to factor AMD sales receivables
in China.
• IBM said it would spend $130 million on marketing and Management Changes
demand-generation programs this year to help channel
partners expand their midmarket sales. As part of this • SAP named Kevin Gilroy head of the North America
effort, IBM plans to develop “building block” systems, channel for SME (small and midsize enterprise).
incorporating IBM hardware, software and storage • Insight Enterprises named Ken Lamneck as its new
technology, which solution providers can customize and president and CEO. Lamneck served as president of the
sell to midmarket customers. IBM also plans new channel Americas at Tech Data since 2004.
cloud Architecture Certifications where partners can learn • Kaspersky Lab named Nancy Reynolds as senior vice
to design public and private cloud computing solutions president of corporate sales. Previously, Reynolds was
based on the IBM products they sell. Dell’s top global enterprise channel executive.
• Websense channel chief David Roberts has resigned amid
an overhaul of the company’s channel strategy.

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GE Capital – Industry Research Monitor: Technology & Business Services 1Q10

• MoneyGram International and Bank of China entered into
Business Services/ an agreement to bring MoneyGram money transfer
services to Bank of China’s 10,000 domestic branches.
Financial Technology • Affiliated Computer Services won a contract to process
child support payments for the State of Ohio. The contract
Consumer deleveraging continues. Recent operating has a potential term of nine years and is worth $163
statistics from both Visa and MasterCard continue to show a million if all option years are exercised.
pattern of growth in debit coupled with a recession-induced
contraction in credit. During 2009, Visa posted U.S. debit
payment charge volume of $883 billion, up 7.9% from $818 Mergers and Acquisitions
billion in 2008. Visa debit payment transaction volumes were
23.9 billion, up 13.8% from 21 billion in 2008. Conversely, Visa • Global Payments sold its DolEx- and Europhil-branded
credit payment volume fell 7.3% to $764 billion from $824 money transfer businesses to an affiliate of Palladium
billion, while the number of credit transactions declined 2.4% Equity Partners LLC.
to 9.04 billion from 9.26 billion in 2008. For all of 2009, • Intuit agreed to sell Intuit Real Estate Solutions to Vista
MasterCard reported that U.S. debit purchase volume rose Equity Partners for approx. $128 million cash.
5.8% to $327 billion from $309 billion while debit payment • SS&C Technologies acquired TheNextRound Inc., a
transaction volume rose 11.7% from 7.46 billion to 8.34 billion provider of software services for the private equity and
transactions in 2008. Similar to Visa, MasterCard credit alternative investment communities.
card purchase volume declined to $477 billion, down 12.9% • ADP acquired DO2 Technologies, a provider of electronic-
from $547 billion in 2008, on 5.91 billion transactions, invoicing services.
down 5.8% from 6.27 billion. • Genpact, acquired Symphony Marketing Solutions, a
provider of analytics and data management services
specializing in the retail, pharmaceutical and consumer
Strategic Updates packaged goods industries.
• Manpower acquired Comsys IT Partners for approx. $430
• Convergys plans to recruit approximately 4,500 additional million including assumed debt, creating an information-
agents through the end of February 2010 for its 12 contact technology staffing concern with total revenue of more
centers in the Philippines. than $2.5 billion.
• CSG Systems International entered into a new multiyear • Private equity firm Marlin Equity Partners acquired certain
agreement with DISH Network. parts of Unisys’ payment systems business.
• A federal court judge rejected Heartland Payment
Systems’ request for a preliminary injunction that sought
to prevent VeriFone Holdings from communicating with Management Changes
Heartland merchants.
• VeriFone has launched a major strategic initiative targeted • SunGard Data Systems appointed Robert Woods CFO.
at leveraging the company’s current and future payment • Alliance Data Systems appointed Charles Horn CFO.
assets into the payment-enabled media marketplace. • Hewitt Associates said that CFO John Park has decided to
The company is also revamping its taxicab technology to leave the company in early 2010 to pursue “new career
include IP-connected Flash 10 technology and dynamic challenges.”
content generation capabilities, with plans to launch the • Investment Technology Group CFO Howard Naphtali
technology in all its New York City taxicabs by June 2010. has retired.
• LML Patent Corp. and RBS Citizens Bank NA have entered • Convergys Corp. said that David Whitwam resigned from
into a settlement and license agreement that provides its board at the end of 2009. The company also named Jeff
RBS Citizens with a license to LML’s patents for electronic Fox president and CEO.
check conversion transactions. • Diebold named Charles Ducey Jr. executive vice president
• Global Axcess signed a 16-month contract with a grocery of North America operations. Diebold also promoted James
store chain based in the U.S. Southeast. The contract is Chen to executive vice president of international
valued at $16,000 per month, covers 72 ATM locations and operations.
upgrades the customer from an in-house processing • Infosys Technologies appointed D. Swaminathan CEO of
system to a full-turnkey Global Axcess program. Infosys BPO Ltd., succeeding Amitabh Chaudhry, who
• Heartland Payment Systems said it agreed to a resigned in November 2009.
settlement under which issuers of Visa-branded credit and • Fiserv said Peter Kight plans to resign as vice chairman at
debit cards will have an opportunity to obtain a recovery the end of the first quarter.
from the company regarding losses they may have
incurred from a 2008 criminal breach.

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GE Capital – Industry Research Monitor: Technology & Business Services 1Q10

Tech & Electronics Global High Yield Issuance ($Billions)
Technology Financings Dominant source of external capital in 2009
60 700
“Safety” remains a balance sheet priority. Despite Total Deal Volume (USD $B)
$52.1 600
expectations for increasing M&A activity and sales during 50 Average Deal Size (USD $M)

Average Deal Size (USD $M)
Total Deal Volume (USD $B)
2010, the majority of technology company CFOs will probably Source: Capital IQ
$42.1 $42.6
500
not seek external financing this year. According to a new 40
$33.6
survey by accounting firm BDO Seidman, approximately one- 400
30
third (32%) of tech CFOs anticipate seeking additional capital 300
in 2010, which is slightly fewer than in 2009 (34%) and slightly 20
more than in 2008 (27%). While the availability of capital $13.8
200
continues to improve, some tech CFOs are still reluctant to 10 $10.0
$10.5 $10.2
100
assume more debt in an uncertain economy. Others may $4.4

need less capital as a result of cost-saving strategies 0 0
implemented in 2009. 2002 2003 2004 2005 2006 2007 2008 2009 YTD 2010

Of those who anticipate raising capital this year, 47 percent
will focus primarily on private equity, down from 56 percent in
2009, but up from 33 percent in 2008. More than one third Tech & Electronics Global Equity Issuance
(37%) will use debt, and the remaining 16 percent will focus Strong rebound in 2009
on public equity. Companies without international operations 20 200
Source: Capital IQ
are much more likely to use debt (53%), while international
$16.8
firms will focus more on private equity (64%) than their Total Deal Volume (USD $B)
$16.3

Average Deal Size (USD $M)
domestic-only counterparts. 15 $14.2 150
$12.2
$12.3
Notable recent financings include the following: $10.4
10 $9.7 100

• Xerox completed a $2 billion senior unsecured notes
offering. Xerox intends to use the proceeds in connection
5 50
with the acquisition of Affiliated Computer Services. Total Deal Volume (USD $B)

• Brocade sold $600 million of senior secured notes in a Average Deal Size (USD $M) $1.8
$0.2
private placement. 0 0
• Salesforce.com closed a private placement of $575 million 2002 2003 2004 2005 2006 2007 2008 2009 YTD 2010

unsecured, unsubordinated convertible senior notes
due 2015.
• Spansion completed a $450 million term loan related to
the company’s attempted exit from bankruptcy. Tech & Electronics Global Loan Issuance
• PRGX Global Inc. entered into a four-year $30 million Private equity slowly re-emerging
secured revolving credit and term loan agreement. 300 500
Source: LPC
• Kemet Corp. plans to offer $275 million in aggregate Total Deal Volume (USD $B)
principal amount of senior notes due 2018. 250 Average Deal Size (USD $M) 400

Average Deal Size (USD $M)
Total Deal Volume (USD $B)

$220.7

Technology Loan Pricing in Secondary Market 200
$174.1 300
Almost back to “normal”
150
110
Source: Thomas Reuters SMi Index as on Feb. 10, 2010 $109.3 $113.3 $110.1 200
105 100 $87.1
$79.7
100 $61.9
50 100
95
$11.7
90
0 0
85 2002 2003 2004 2005 2006 2007 2008 2009 YTD 2010

80

75

70

65

60
6/2002
10/2002
2/2003
6/2003
10/2003
2/2004
6/2004
10/2004
2/2005
6/2005
10/2005
2/2006
6/2006
10/2006
2/2007
6/2007
10/2007
2/2008
6/2008
10/2008
2/2009
6/2009
10/2009

© Copyright 2010 General Electric Capital Corporation. All Rights Reserved. 7
GE Capital – Industry Research Monitor: Technology & Business Services 1Q10
GE Capital – Industry Research Monitor: Technology & Business Services 1Q10

GE Capital Technology GE Capital Technology
Lending Transactions Leasing Transactions
$450,000,000 $7,800,000
ABL & Securitization 36-month FMV lease
Agent for revolving credit facility Laptop deployment for U.S. field sales representatives
Business Process Services Global Pharmaceutical Company

$428,500,000 $10,000,000
Cash Flow Credit Facility FMV lease
Co-Agent for term loan and revolver IT equipment from multiple vendors for 8 data centers
Transaction Technology Services Provider U.S. Telecommunications Company

$316,000,000 $62,000,000
A/R Securitization Capital Lease
Sole Lead Arranger IT equipment
Leading Provider of Software and IT Services National Mortgage and Financial Services Company

$250,000,000 $15,000,000
A/R Securitization Capital + FMV leases
Agent for balance sheet recapitalization Store network deployment of point-of-sale equipment
Leading Provider of IT Continuity Services North American Retailer

$145,000,000 $43,000,000
Combined Senior and Second Lien Facility 60-month synthetic lease
Agent for corporate restructuring facility Upgrade of point-of-sale equipment
Digital Imaging and Document Solutions Large Regional Retailer

Industry Technology Conference Calendar
Date Event Location
March 23-25, 2010 DistribuTECH Tampa, FL (Convention Ctr)
April 6-8, 2010 IPC APEX EXPO 2010 Las Vegas, NV (Mandalay Bay)
April 21-22, 2010 Nepcon Boston, MA (Convention Ctr)
May 3-6, 2010 Web 2.0 Expo San Francisco, CA (Moscone)
May 18-21, 2010 Multicore Expo Santa Clara, CA (Convention Ctr)
July 13-15, 2010 Semicon West San Francisco, CA (Moscone)
Sept. 14-17, 2010 IMTS 2010 Industry & Technology Conference Chicago, IL (McCormick Place)
Oct 5-8, 2010 CTIA-Wireless IT & Entertainment San Francisco, CA (Moscone)

Industry Investor Conference Calendar
Date Event Location
Mar 1-4, 2010 Morgan Stanley Technology, Media & Telecom Conference San Fran., CA (The Palace Hotel)
Mar 8-10, 2010 Jefferies Global Technology Conference New York, NY (Mandarin Oriental)
May 17-19, 2010 JPMorgan Global Technology, Media and Telecom Conf Boston, MA (Westin Waterfront)
June 2-3, 2010 BofA Merrill Lynch U.S. Technology Conference New York, NY (Westin Times Sq.)
June 8-10, 2010 UBS Global Technology & Services Conference New York, NY
Aug 10-11, 2010 Oppenheimer Annual Technology, Media & Telecom Conf Boston, MA (Four Seasons Hotel)
Sep 14-16, 2010 Deutsche Bank Securities 2010 Technology Conference San Francisco, CA (The Westin)

© Copyright 2010 General Electric Capital Corporation. All Rights Reserved. 9
GE Capital – Industry Research Monitor: Technology & Business Services 1Q10

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GE Capital Industry Team
RESEARCH ANALYSTS

Michael Zimm, CFA
Technology & Business Services
Aerospace & Defense
Construction
646-428-7015

Richard Aldrich, CFA
Chemicals & Plastics
Metals & Mining
Auto & Auto Parts
646-428-7365

Henry Fang
Media, Communications & Entertainment
General Manufacturing
Transportation
203-229-1437

Garrick Go
Franchise
408-563-6227

Richard James
General Manufacturing
203-229-1984

Lauren Milikin
Franchise
480-563-6246

Loren Trotta
Food, Beverage & Agribusiness
Financial Services
203-229-1877

Disclaimer: Although General Electric Capital Corporation (“GE”) believes that the information contained in this newsletter has been obtained from and is based upon sources GE
believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. GE makes no representation or warranties of any kind whatsoever in respect of such
information. GE accepts no liability of any kind for loss arising from the use of the material presented in this newsletter. This newsletter is not to be relied upon in substitution for the
exercise of your independent judgment or legal advice.

10 © Copyright 2010 General Electric Capital Corporation. All Rights Reserved.