Slide 1: Investor Relations May-June 2009
Investor Relations May-June 2009
Slide 2: Forward-looking statements and proxy information
© Copyright Entrust, Inc. 2008 2 Today's Presentation contains forward-looking statements, within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Act of 1934, relating to Entrust Inc.’s projected revenue, net income per share, non-GAAP income per share and
Slide 3: Agenda
© Copyright Entrust, Inc. 2008 3 Agenda The Board of Directors of Entrust, Inc. believes that $1.85 per share would result in greater value to the company’s stockholders than the other alternatives it has considered. • Company Background • Entrust Stock Price Performance • Transaction Overview • Con
Slide 4: Company Background
© Copyright Entrust, Inc. 2008 4 Company Background
Slide 5: Entrust is a World Leader in Identity Management and Security Software
© Copyright Entrust, Inc. 2008 5 Entrust is a World Leader in Identity Management and Security Software • Founded in 1994, publicly-listed in 1998 (NASDAQ: ENTU) • Best-in-class technology, service and support – industry pioneer • Over 2000 customers in countries – global reach • Geographic presence
Slide 6: Business Diversity and Complexity
© Copyright Entrust, Inc. 2008 6 Fraud/RBA US EMEA CALA PKI Confidential ~ Entrust Board of Directors Business Diversity and Complexity 46% 25% 29% Product Platforms Verticals Geographies
Slide 7: Revenue
© Copyright Entrust, Inc. 2008 7 Revenue Growth ~ Mix shift and exchange rate flattening growth curve $M $91M $98M $95M $100M 31% Growth; 7% CAGR on Software 10% Total Growth; 2% CAGR $100M Overall Services Flat 2004 2005 2006 2007 2008 Service Product
Slide 8: Product Transition
© Copyright Entrust, Inc. 2008 8 20.1 22.3 10.8 15.2 14.8 0.9 1.6 9.7 6.0 3.6 3.5 4.5 5.5 7.3 9.6 4.8 5.8 9.4 7.9 10.4 $0 $5 $10 $15 $20 $25 $30 $35 $40 $45 2004 2005 2006 2007 2008 Public Key Infrastruture Pupblic Key Infrastructure Info Protection SSL Risk Based Authentication Product Transition ~
Slide 9: Market Dynamics
© Copyright Entrust, Inc. 2008 9 Security Software MANAGED SERVICES Enterprise Software System Integrators/Networks Market Dynamics: Entrust Oracle Cisco Microsoft CA Verizon SI’s EMC Verisign Symantec Local Vendors Local Vendors IBM McAfee Open Source Checkpoint HP Microsoft “SAAS” Siemens Thales I
Slide 10: Company Challenges
© Copyright Entrust, Inc. 2008 10 Company Challenges: • Uncertain economic outlook globally and especially in the financial vertical • Public compliance costs are increasing for small companies • Increased competition from larger players requires increased scale to compete • Risks involved with busi
Slide 11: Entrust Stock Performance
© Copyright Entrust, Inc. 2008 11 Entrust Stock Performance
Slide 12: 3-Year Relative Stock Price Performance
© Copyright Entrust, Inc. 2008 12 Source: FactSet. Note: Security Comps include: ACTI, CA, CHKP, FIRE, GUID, MFE, SNWL, SYMC, VDSI, VRSN, WBSN. Sub-Scale Security Comps include: ACTI, GUID, FIRE, SNWL, VDSI. May - 2006 Oct - 2006 Feb - 2007 Jul - 2007 Nov - 2007 Apr - 2008 Aug - 2008 Jan - 2009 May
Slide 13: Transaction Overview
© Copyright Entrust, Inc. 2008 13 Transaction Overview
Slide 14: Transaction Background and Key Dates
© Copyright Entrust, Inc. 2008 14 Transaction Background and Key Dates Date Event 10/15/2007 Board of directors approved the engagement of Barclays Capital as Entrust’s financial advisor to assist Entrust in exploring various strategic alternatives 12/2007 - 3/2008 Entrust ran sell side process whic
Slide 15: Transaction Overview
© Copyright Entrust, Inc. 2008 15 Transaction Overview • Rigorous, deliberative Board process designed to ensure stockholders receive maximum value for their investment – Considered all reasonable alternatives to deliver full value to stockholders – Advised by internationally recognized financial fi
Slide 16: Transaction Overview (continued)
© Copyright Entrust, Inc. 2008 16 Transaction Overview (continued) • In the course of reaching its decision, over a period of several months, the Board consulted members of senior management, financial and legal counsel and considered a number of factors, including: – None of the possible alternativ
Slide 17: Transaction Overview (continued)
© Copyright Entrust, Inc. 2008 17 Transaction Overview (continued) • Fair value of $1.85 cash per share – Premium to 30-day trading day average ending 4/9/09 (22.5% premium) – Valuation supported by publicly traded companies analysis, DCF analysis, selected precedent transaction analysis, transactio
Slide 18: Key Terms
© Copyright Entrust, Inc. 2008 18 Key Terms • Minimum cash balance of $21.5 million (or $23 million if the closing occurs before July 15, 2009 or after September 15, 2009) • Break up fee: – 2.0% ($2.3M) of the Company’s equity value on signing date during go-shop period; 4.0% ($4.6M) of the Company’
Slide 19: Transaction Provides a Significant Premium
© Copyright Entrust, Inc. 2008 19 Transaction Provides a Significant Premium 1. Trading day averages ending 4/9/09. 2. Intraday low during period in which the original Thoma Bravo offer of $1.75 per share had been outstanding. 3. Per Entrust’s 1Q09 10-Q. 4. Outstanding lease liability per Entrust’s
Slide 20: Transaction Rationale
© Copyright Entrust, Inc. 2008 20 Transaction Rationale • Board carefully considered other strategic alternatives as sources of stockholder value, but deemed them to have greater risk and lower probability of a higher valuation now or in the future • Post-signing market check process – other indicat
Slide 21: Conclusion
© Copyright Entrust, Inc. 2008 21 Conclusion
Slide 22: Conclusion
© Copyright Entrust, Inc. 2008 22 Conclusion • Board process designed to ensure stockholders receive full value for their investment alternatives – Considered all reasonable alternatives to deliver full value to stockholders • Fair value of $1.85 cash per share – Fairness of price supported by valua