Technology valuation snapshot

www.pwc.com/ca/tech-valuations Technology valuation snapshot Q1 2014 A summary of Q1 2014 Canadian deal activity results. April 2014

Public market volatility returns to hardware, software slows momentum The first quarter of 2014 saw a return to volatility in the Canadian technology sector, led by the Hardware and Equipment Index, and largely tied to events relating to BlackBerry Ltd. (TSX: BB), which comprises 67% of the index. In January, BlackBerry successfully closed a CA$1.25 billion private placement, including CA$250 million from Fairfax Financial Holdings Ltd (Fairfax), a long time and very public supporter of BlackBerry. Fairfax, headed by Prem Watsa, remains the company s largest shareholder, owning 18.4%. Fairfax president Paul Rivett recently said in an interview that the market is only just beginning to see the true potential of BlackBerry under CEO John Chen s leadership. BlackBerry subsequently sold the majority of its Canadian real estate in March 2014. Further contributing to the volatility was market reaction to Celestica Inc s (TSX: CLS) in-line earnings performance, taking the stock price down 7.3%. Celestica subsequently rebounded to a 52- week high. Canadian software and services technology stocks traded in line with the broader market in Q1 2014 despite increased investments and growing competition in the heated cloud-based sector over the last half of 2013. Fig. 1 Public market valuation Stock price performance 35% 30% 25% 20% 15% 10% 5% 0% -5% Jan 2013 Feb 2013 Mar 2013 S&P/TSX composite index S&P/TSX composite index software & services S&P/TSX composite index technology hardware & equipment 2

Fig. 2 Public market valuation Canadian public company comparables Top five companies by market capitalization Company Ticker Share price Market cap. Enterprise value LTM revenue LTM EBITDA Cash Net debt EV/ revenue EV/ EBITDA P/E Large Caps (> $1B) CGI Group, Inc. TSX:GIB.A $34 $10,498 $13,438 $10,196 $1,475 $206 $2,940 1.3 x 9.1 x 18.3 x Open Text Corporation NasdaqGS:OTEX $48 $5,770 $5,801 $1,373 $422 $515 $31 4.2 x 13.8 x 36.8 x Constellation Software Inc. TSX:CSU $268 $5,679 $6,103 $1,211 $155 $78 $398 5.0 x 39.4 x 59.4 x BlackBerry Limited TSX:BB $9 $4,644 $3,644 $6,813 $(2,256) $1,579 $(902) 0.5 x (1.6 x) nm Davis + Henderson Corporation TSX:DH $31 $2,496 $3,601 $837 $214 $32 $1,105 4.3 x 16.8 x 34.1 x Celestica Inc. TSX:CLS $12 $2,173 $1,594 $5,796 $204 $544 $(544) 0.3 x 7.8 x 17.7 x Median 2.6 x 14.2 x 33.2 x Medium Caps ($500m $1B) The Descartes Systems Group TSX:DSG $15 $984 $959 $151 $43 $63 $(22) 6.3 x 22.5 x 91.0 x Enghouse Systems Limited TSX:ESL $31 $820 $720 $185 $39 $77 $(100) 3.9 x 18.6 x 31.4 x Sierra Wireless Inc. TSX:SW $24 $750 $560 $442 $11 $177 $(179) 1.3 x 49.4 x nm Redknee Solutions Inc. TSX:RKN $6 $599 $569 $188 $7 $71 $(28) 3.0 x 84.5 x nm Aastra Technologies Ltd. TSX:AAH $0 $500 $414 $606 $42 $113 $(110) 0.7 x 9.8 x 28.5 x Median 3.0 x 37.0 x 50.3 x Small Caps (< $ 500m) Sandvine Corporation TSX:SVC $3 $467 $382 $113 $31 $8 $(121) 3.4 x 12.5 x 22.1 x Points International Ltd. TSX:PTS $29 $438 $370 $202 $5 $64 $(64) 1.8 x 71.3 x 111.5 x Wi-Lan Inc. TSX:WIN $3 $396 $311 $88 $59 $130 $(80) 3.5 x 5.2 x nm Solium Capital Inc. TSX:SUM $7 $324 $278 $68 $17 $24 $(46) 4.1 x 16.6 x 35.1 x Pure Technologies Ltd. TSX:PUR $7 $344 $303 $61 $10 $41 $(41) 5.0 x 28.9 x 178.3 x Median 3.6 x 26.9 x 86.8 x All figures in CAD Millions, except share price and multiples. *Priced as at March 31, 2014 3

M&A Software and services continue to dominate Following global trends, Q1 2014 Canadian technology M&A deal activity remained focused in software and IT services. In January, HootSuite, a provider of platform services for social media campaigns, acquired ubervu, a social web-based analytical company based in the UK for an undisclosed amount. This acquisition expands HootSuite s capabilities and grows its market dominance as a major provider of platform services for social media campaigns through various channels, such as Twitter, LinkedIn and Facebook. Sphere 3D Inc, a provider of real-time software solutions acquired V3 Systems Inc, a technology leader in desktop cloud management solutions for CA$11.7 million, supporting the strong trend of Canadian companies seeking further advancement of real-time technology in the cloud computing space. Blue Spurs, a mobile app development and cloud solutions provider acquired Lashpoint, an enterprise software developer, for approximately CA$50 million. Blue Spurs has a strong focus in the enterprise segment, and Lashpoint s proven expertise in software development, made this transaction an easy strategic decision. In March, Analytix, a big data analytic solutions provider, acquired OneUp Insights, a locationbased mobile advertising company, for CA$1.54 million. Analytix provides services that produce useful information based on internet usage. OneUp s ability to translate internet information into advertising services made this a suitable opportunity for the company. In February, HTN, a healthcare IT solutions provider, acquired Apt Software Canada, a provider of software development and testing solutions, for CA$600,000. Apt Software has proven expertise in enterprise applications and end to end product engineering. This compliments HTN s ability to deliver an end-to-end product to professionals in Canada. Given that Apt Software also has strong relationships in Europe and Asia, this acquisition also opens up the possibility of future international expansion for HTN. Fig 3. Canadian technology M&A Q1:2014 Top deals by value Date Buyer Target Target - Region (CADmm) Jan-14 Blue Spurs Inc Lashpoint Inc Canada *50 Feb-14 Sphere 3D Corp. V3 Systems Inc. Canada 11.74 Mar-14 500px Inc Authintic Canada *10 Mar-14 Analytix Insight OneUp Insights Inc. Canada 1.54 Feb-14 HTN Inc Apt Software Canada Inc. Canada **0.6 Jan-14 HootSuite Media Inc ubervu Inc United Kingdom - * Estimated per MergerMarket ** All share consideration, value estimated based on most recent close price Sources: ThomsonOne, Capital IQ, MergerMarket and PwC analysis 4

Mid market shifting toward larger deals landscape The Canadian mid-market deal activity improved in Q1, representing 34% of total technology deal flow, compared with only 18% in Q1 2013. Deals below CA$1 million in value represented 63% of total deal volume in Q1 2014, down from 79% in Q1 2013, signalling a slight shift of deals to larger, more established tech companies in the Canadian landscape with greater growth opportunities. Total deal value also improved slightly to CA$96 million in Q1 2014 compared to CA$91million in Q1 2013. Fig. 4 Technology M&A volume by value (Canada) 20% 79% 63% 15% 16% 16% 10% 11% Q1 2013 Q1 78% 2014 5% 0% 4% 4% 3% 3% 2% <1M* $1M $5M $5M $10M $10M $20M $20M $50M *Includes undisclosed deal values By sector, software continues to remain strong, grabbing the lion s share of M&A activity at 29% in Q1 2014, up from 23% a year ago. IT services holds steady at 19% of M&A deals in Q1 as companies use acquisitions to gain a competitive edge in race for the expert title in cloud capabilities. Internet software and services declined slightly in Q1 2014 compared to Q1 2013. But they still comprise a significant portion of total deal volume at 14%, driven by the growing need for data analytics and big data processing solutions. Fig. 5 Deals by subsectors Comparison: 2013 Q1 and 2014 Q1 Software IT Consulting & Services Computers & Peripherals 2013 Q1 2014 Q1 2013 Q1 2014 Q1 2013 Q1 2014 Q1 9% 13% 19% 19% 2013 Q1 6% e-commerce 39% 2014 Q1 5% Internet 39% 2013 Q1 18% Software & Services 2014 Q1 14% 28% Other 2013 Q1 2014 Q1 26% 23% 29% 0% 5% 10% 15% 20% 25% 30% 5

IPO no movement in Canada but technology IPOs are gaining momentum The Canadian technology IPO market saw no new issuers in Q1. US IPO activity remains healthy, with Candy Crush mobile app developer King Digital going public at a US$7.6 billion valuation. Interest around mobile apps and social media remains high, with valuation reaching new heights with each new offering. Fig. 7 Technology initial public offerings (IPO) US Q1:2014 Top five by volume Date Issuer Sub-industry Mar-14 King Digital Entertainment PLC (NYSE:KING) Funds raised (USDmm) Software 495.0 Mar-14 Castlight Health Inc. (NYSE:CSLT) Software 204.2 Mar-14 A10 Networks Inc. (NYSE:ATEN) Software 187.5 Mar-14 Coupons.com Inc. (NYSE:COUP) E-commerce 193.2 Mar-14 Paylocity Holding Corp. (NASDAQ:PCTY) Software 137.7 Fig. 8 Upcoming technology IPOs US Expected date Issuer Sub-industry Funds raised (USDmm) Apr-14 Sabrecorp. Software 1,029.0 Apr-14 Box Inc. E-commerce 250.0 Apr-14 Paycomm Software Inc. IT Software and Services 152.8 Apr-14 Sysorex Global Holdings Corp. IT Software and Services 23.0 N/A Dropbox Inc. IT Software and Services - N/A Alibaba Group Holding Ltd. E-commerce - Also in Q1, several companies made announcements about their intention to go public. Sabre Corporation (Travelocity s owner), as a travel and tourism technology company, is hoping to raise over US$1 billion from public markets, capitalizing on favourable market sentiment. In another highly anticipated move, Box Inc, a cloud-based service company, also announced plans to go public mid-april. As a result of Box Inc s impending IPO, Dropbox, a major competitor, has delayed immediate plans of an IPO, planning instead to grow the company s enterprise business (a major segment of Box). 6

North American technology IPOs have fluctuated over the last eight quarters largely due to two mega IPOs from Facebook in Q2 2012 and Twitter in Q4 2013. With the exception of these two offerings, technology IPOs have gained momentum as investor appetite increases around social media and derivative products such as big data analytics. With public valuations at all-time highs, follow-on offerings have grown considerably and remain the most attractive form of equity capital raising in the tech sector. Frothy public markets also played a role in the private placement nose dive in Q1, while IPO activity remains steady. Fig. 9 Technology initial public offerings (IPO) Canada & US 2013 Volume by quarter facebook IPO 16,893 3,500 3,000 2,500 Q1 2012 Q1 2013 Q1 2014 3,229 20,000 15,000 IPOs Follow-on equity offerings Private placements USDmm 2,000 1,500 1,633 1,796 USDmm 10,000 1,000 500 0 981 874 793 969 410 364 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 5,000 0 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 7

Technology financing Fig. 10 Follow-on equity offerings Canada Q1:2014 Top five by volume Date Issuer Sub-industry (USDmm) Mar-14 Versatile Systems Inc. (TSV:VV) Software 90.4 Feb-14 Redknee Solutions Inc. (TSX:RKN) Software 67.4 Jan-14 Sanvine Corp. (TSX:SVC) Computers and Peripherals 29.8 Jan-14 BSM Technologies Inc. (TSV:GPS) Software 20.1 Feb-14 Cortex Business Solutions Inc. (TSV:CBX) Internet Software and Services 9.0 Fig. 11 Follow-on equity offerings US Q1:2014 Top five by volume Date Issuer Sub-industry (USDmm) Mar-14 Nielsen Holdings NV (NYSE:NLSN) Computers and Peripherals 1,393.5 Mar-14 FireEye Inc. (NASDAQ:FEYE) Software 1,148.0 Feb-14 Freescale Semiconductor Ltd. (NYSE:FSL) Software 744.6 Jan-14 Workday Inc. (NYSE:WDAY) Computers and Peripherals 614.1 Mar-14 Vantiv Inc. (NYSE:VNTV) Computers and Peripherals 592.6 Fig. 12 Private placements Canada Q1:2014 Top five by volume Date Issuer Sub-industry (USDmm) Jan-14 Blackberry Limited Hardware 1,250.0 Mar-14 Themis Solutions Inc. Software 20.0 Mar-14 Slyce E-commerce 10.8 Feb-14 MLM1 Corp. Software 7.5 Feb-14 Exo U Inc. (TSV:EXO) Software 7.0 Fig. 13 Private placements US Q1:2014 Top five by volume Date Issuer Sub-industry (USDmm) Jan-14 Vmware Inc. (NYSE:VMW) Internet Software and Services 1,050.0 Mar-14 Cloudera Inc. Internet Software and Services 900.0 Feb-14 Kronos Incorporated Internet Software and Services 750.0 Jan-14 Dropbox Inc. Internet Software and Services 450.0 Mar-14 TangoMe Inc. Software 282.5 8

Lack of IPOs Venture funding slows Lack of IPO activity in the Canadian tech sector has impacted venture funding, which came in at CA$96 million for Q1 2014 the lowest level in the past eight quarters. Despite these trends, Canadian innovation remains high. Slyce, a Toronto-based startup specializing in image recognition technology for consumer retail has recently obtained sizeable funding of CA$10.8 million, with intention to raise more equity in the coming months to gain a market edge over competitors such as Amazon s Flow technology, which offers similar features. Of the CA$96 million raised for venture capital financing in Q1 2014, Themis Solutions Inc, a provider of cloud-based platform software to small law firms, raised CA$20 million. The purpose of the funding is to accelerate development of Themis Solutions core product and to expand internationally. Fig. 14 Private placements venture capital Canada Q2:2012 Q1:2014 CADmm 1,000 800 600 400 200 0 419 286 808 188 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 318 238 353 359 Q1 2012 Q1 2013 Q1 2014 39 96 Sources: ThomsonOne and PwC analysis Fig. 15 Canadian venture capital funding Q1:2014 Date Issuer Subindustry (CADmm) Mar-14 Themis Solutions Internet Software and Services 20.0 Mar-14 Slyce E-commerce 10.8 Jan-14 ResponseTek Networks Corp. Internet Software and Services 6.6 Mar-14 The Pythian Group Inc. IT Consulting and Services 6.0 Mar-14 Elastic Path Software Inc. E-commerce 5.0 Sources: ThomsonOne and PwC analysis 9

Spotlight on Silicon Valley Technology investment in Silicon Valley remains at an all-time high, with software in heavy demand, representing over 49% of total investments. IT services, a far second, holds over 12% of total investments. With Facebook s US$19 billion purchase of WhatsApp implying a 19x sales multiple, the market is hotter than ever, with software companies eager to gain funding and investors eager to deploy capital to fund the next big thing. Rapidly falling out of favour are computers and peripherals as computer hardware continues to be cannibalized by the tablet and smartphone market. Fig. 16 Investment in Silicon Valley Q1:2014 Software 238 3,153 IT services Consumer producst and services Media/Entertainment Biotechnology Industrial/Energy Computers and peripherals 625 450 808 378 268 236 194 Medical devices and equipment 188 Semiconductors 28688 318 353 359 Telecommunications 38 188 Retailing/Distribution 32 39 96 0 500 1,000 1,500 2,000 2,500 3,000 3,500 Total invested (CADmm) Sources: ThomsonOne and PwC analysis 10

Cloudera Inc, a big data analytics company, has recently received major funding from Intel, T. Rowe Price, MSD Capital and Google Ventures for approximately US$900 million. The company has received unconditional support since its inception in 2008 from numerous other private equity firms, showing strong expected growth in the big data sector. TangoMe, a mobile communication app, has recently obtained a large amount of funding amounting to almost a quarter of a billion dollars. Along with the WhatsApp acquisition, the aspiration of these application companies appears endless with valuation multiples that compare to the tech boom in the early 2000s. Although Dropbox, a cloud product company, hasn t yet gone public, the company is still receiving large private funding as shown from the recent investment of US$360 million from investors. This infers a US$10 billion company valuation, making Dropbox another multi-billion dollar tech company. This funding has been used for the recent acquisitions of Zulip Inc, a private messaging service platform for desktop and mobile, and Readmill Network Limited, a provider of ebook readers with social and sharing capabilities. Fig. 17 Recent venture funding in the Valley Date Company Subindustry Description Mar-14 Cloudera Inc. IT Software and Services Mar-14 Dropbox Inc. Internet Software and Services Develops enterprise analytic data mangement software (big data solutions) Provides of a cloud storage platform allowing access anywhere over the internet Mar-14 TangoMe Inc. Software Provides a mobile a messaging and calling application Mar-14 Jan-14 Hortonworks Inc. Palantir Technologies Inc. IT Software and Services Software Development and adoption of Apache Hadoop (big data solutions) over its own open source data platform Provides data fusion software applications as well as cyber secuitry services (CADmm) 900.0 359.8 244.9 111.7 111.5 Sources: ThomsonOne and PwC analysis 11

Your valuation specialists: Independent, experienced and objective We provide valuations, fairness opinions, loss quantification, expert testimony and business modelling to help individuals, companies and their counsel. Calgary Paul Sharp CA, CBV 403 509 7550 paul.w.sharp@ca.pwc.com Toronto Helen M. Mallovy Hicks CPA, FCA, CBV 416 814 5739 helen.m.mallovy.hicks@ca.pwc.com Montreal Dominic Pharand CPA, CA, CFA, CBV 514 204 5179 dominic.pharand@ca.pwc.com Vancouver Bob J. Sandy CA, IFA, CBV 604 806 7422 robert.j.sandy@ca.pwc.com From source to sale and everything in between our experience extends to all segments of the technology industry. We know how your company s value chain works and we can help. Christopher Dulny National Technology Sector Lead 416 869 2355 christopher.dulny@ca.pwc.com Nitin Kaushal Managing Director, Corporate Finance 416 687 8269 nitin.kaushal@ca.pwc.com Report contributors Shivalika Handa Vice President, Corporate Finance 416 687 8716 shivalika.handa@ca.pwc.com Brandon Roopnarinesingh Analyst, Corporate Finance 416 941 8383 ext: 13587 brandon.roop@ca.pwc.com 2014 PricewaterhouseCoopers LLP, an Ontario limited liability partnership. All rights reserved. PwC refers to the Canadian member firm, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see www.pwc.com/structure for further details. 4054-01 0514