Cantor Morning News | Event Driven

· “WE obviously didn’t view the PAR deal with DELL as good news, but it was not a huge surprise either. When DELL purchased EqualLogic (EQLX) recently, we could see what DELL’s strategy was becoming (DELL announced EQLX deal 11/5/07, and it closed 1/28/08). DELL was clearly trying to fill gaps and PAR is a logical fit for them given that strategy. We started to de-emphasize our relationship with DELL after that deal and in fact for the last several quarters we don’t even break out the revenues due to DELL res-selling anymore.” (she gave the example that in Q2 ’09, 30% Clarion revenues was due to DELL relationship). “Since that Deal, DELL is now one of many channels for us, and no longer a critical relationship.”

· Even with the PAR deal, we will still have a relationship DELL, and we are just not sure how successful DELL will be reselling into the high end. HPQ winning PAR would be more of negative for us than DELL winning PAR (yes it would be fair to say we are rooting for DELL to win, but no we have no insight if they will come back with a higher price.”)

· “Where the PAR deal clearly made sense to DELL to fill in the gaps, especially in the high-tier and top of the mid-tier, this deal also makes sense for HPQ and we are not surprised HPQ bid. And now we know why DELL bid so much in the first place.” She agreed that at this price, PAR it is definitely affordable for both companies, but HPQ clearly can pay more and has bid to win. She agreed that HPQ’s no break fee bid was probably an extra tell that HPQ was bidding to win and show some muscle.

· We discussed DELL perhaps buying others as a work around (i.e. CVLT, ISLN, CML) to fighting over PAR and she said those other companies really weren’t game changers (the phrase she used was ‘ankle biters’) and really would not help DELL with the strategy of filling in the gaps in the high-tier and upper middle-tier areas where they were lacking.

· “THIS IS NOT A GOOD DAY FOR DELL. They are kind of stuck between a rock and a hard place after the EQLX deal and now the PAR deal and they kind of have to come back. Of course, at some point they can’t compete with HPQ and do they risk chasing a fight that they very well may not be able to win? And they can always alter their strategy as well.”

· “PAR makes no sense for us to try to buy from a technology point of view—they don’t really have anything that we don’t have or can’t develop. We think the opportunity is in the mid-tier and that is our focus.”

Regarding MFE/INTC:

· “To see a deal with security focused now on the chip level is interesting to us. We still believe security on the information level is more important and that is our strategy, so this deal doesn’t have any overlap with us. We want the security on the information level, not the lab top level and we think the right strategy is to secure information (for instance information between two laptops) as opposed to securing the computer.”

· “SYMC is clearly having a hard time integrating and so we are not sure anyone would want to take them on at this point in time. MFE definitely figured to be the better target.”

Cantor Flows

ATAC buyer

NTY buyer,

LIA 2 ways,

ACF buyer,

DIVX/SNIC Setter,

UNCA buyer,

DYN 2 ways and buy-writes,

ALY buyer

PAR 2 ways,

PTV Large buying,

POT 2 ways/options,

RSCR better buyer,

DISCK/A unwinder

MEND 2 ways,

CPII/CMTL setter,

ID buyer,

MFE large buying

Disclaimer: Prepared by staff of Cantor Fitzgerald & Co. ("Cantor") and is for information purposes only. It is not intended to form the basis of any investment decision, should not be considered a recommendation by Cantor or any other person and does not constitute an offer or solicitation with respect to the purchase or sale of any investment nor is it a confirmation of terms. Any calculations and valuations presented herein are intended as a basis for discussion. Sources of information are believed to be reliable but Cantor makes no representation and gives no warranty that the information contained herein is accurate or complete. Any opinions or estimates given may change. Cantor undertakes no obligation to provide recipients with any additional information or any update to or correction of the information contained herein. This material is intended solely for institutional investors and investors who Cantor reasonably believes are institutional investors. Cantor, its officers, employees, affiliates and partners shall not be liable to any person in any way whatsoever for any losses, costs or claims howsoever arising from any inaccuracies or omissions in the information contained herein or any reliance on that information. Cantor may have positions in financial instruments mentioned, may have acquired such positions at prices no longer available, and may have interests different or adverse to your interests. No liability is accepted by Cantor for any loss that may arise from any use of the information contained herein or derived here from. This product may not be reproduced or redistributed outside the recipient's organization. Sources: Cantor Fitzgerald & Co., Reuters, Bloomberg, CNBC, Dow Jones, Marketwatch, Trade-Alert, and the Wall Street Journal. ***All eco data from Bloomberg and DJ