##### Table of Contents





UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549





FORM 10-K

(Mark One)

|x | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ------------------------------------------------------------------------------------

For the fiscal year ended November 30, 2009



| ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------

For the transition period from
 to

Commission File Number: 000-26579





TIBCO SOFTWARE INC.

(Exact name of registrant as
specified in its charter)



|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|Delaware                                                       |  | 77-0449727                          
|(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification No.)

3303 Hillview Avenue, Palo Alto, CA 94304

(Address of principal executive offices) (Zip Code)

Registrants telephone number, including area code: (650) 846-1000

Securities registered pursuant to Section 12(b) of the Act:



|                                         |  |                                       
|---------------------------------------- |  | --------------------------------------
|Common Stock, $0.001 par value per share |  | The NASDAQ Global Select Market       
|(Title of class)                         |  | (Name of exchange on which registered)

Securities registered pursuant to Section 12(g) of the Act:

None





Indicate by check
mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes  x    No   ̈

Indicate by check mark if the registrant is not required to file reports pursuant
to Section 13 or Section 15(d) of the Act.    Yes   ̈    No  x

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90
days.    Yes  x    No   ̈

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such
files).    Yes  x    No   ̈

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not
contained herein, and will not be contained, to the best of registrants knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  x

Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act. (Check
one):



|                                                                                                                                       |  |  |  |                                               |  | 
|-------------------------------------------------------------------------------------------------------------------------------------- |  |  |  | --------------------------------------------- |  | 
|Large accelerated filer  x            Accelerated filer   ̈            Non-accelerated filer   ̈            Smaller reporting company   ̈
|                                                                                                                                       |  |  |  | (Do not check if a smaller reporting company) |  | 

Indicate by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).    Yes   ̈    No  x

The aggregate market value of the voting stock held by non-affiliates of the registrant (based upon the closing sale price of such shares on
the NASDAQ Global Select Market on May 29, 2009) was approximately $1.0 billion. Shares of common stock held by each executive officer and director and by each entity that owns 5% or more of the outstanding common stock have been excluded in
that such persons may be deemed to be affiliates. This determination of affiliate status is not necessarily a conclusive determination for other purposes.

As of January 15, 2010, there were 166,565,128 shares of the registrants common stock outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the registrants
Proxy Statement for the 2010 Annual Meeting of Stockholders to be held on April 22, 2010 are incorporated by reference into Part III of this Annual Report on Form 10-K to the extent stated herein.









---

##### Table of Contents

TIBCO SOFTWARE INC.

For the Fiscal Year Ended November 30, 2009

TABLE OF CONTENTS



|         |  |                                                                                                              |  |         
|-------- |  | ------------------------------------------------------------------------------------------------------------ |  | --------
|         |  |                                                                                                              |  | Page No.
|         |  | PART I                                                                                                       |  |         
|         |  |                                                                                                             
|Item 1.  |  | BUSINESS                                                                                                     |  | 1       
|         |  |                                                                                                             
|Item 1A. |  | RISK FACTORS                                                                                                 |  | 6       
|         |  |                                                                                                             
|Item 1B. |  | UNRESOLVED STAFF COMMENTS                                                                                    |  | 16      
|         |  |                                                                                                             
|Item 2.  |  | PROPERTIES                                                                                                   |  | 17      
|         |  |                                                                                                             
|Item 3.  |  | LEGAL PROCEEDINGS                                                                                            |  | 17      
|         |  |                                                                                                             
|Item 4.  |  | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS                                                          |  | 17      
|         |  |                                                                                                             
|         |  | PART II                                                                                                      |  |         
|         |  |                                                                                                             
|Item 5.  |  | MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES |  | 18      
|         |  |                                                                                                             
|Item 6.  |  | SELECTED FINANCIAL DATA                                                                                      |  | 21      
|         |  |                                                                                                             
|Item 7.  |  | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS                        |  | 23      
|         |  |                                                                                                             
|Item 7A. |  | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                                                   |  | 40      
|         |  |                                                                                                             
|Item 8.  |  | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA                                                                  |  | 41      
|         |  |                                                                                                             
|Item 9.  |  | CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE                         |  | 41      
|         |  |                                                                                                             
|Item 9A. |  | CONTROLS AND PROCEDURES                                                                                      |  | 41      
|         |  |                                                                                                             
|Item 9B. |  | OTHER INFORMATION                                                                                            |  | 42      
|         |  |                                                                                                             
|         |  | PART III                                                                                                     |  |         
|         |  |                                                                                                             
|Item 10. |  | DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE                                                       |  | 43      
|         |  |                                                                                                             
|Item 11. |  | EXECUTIVE COMPENSATION                                                                                       |  | 44      
|         |  |                                                                                                             
|Item 12. |  | SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS               |  | 44      
|         |  |                                                                                                             
|Item 13. |  | CERTAIN RELATIONSHIPS, RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE                                        |  | 44      
|         |  |                                                                                                             
|Item 14. |  | PRINCIPAL ACCOUNTING FEES AND SERVICES                                                                       |  | 44      
|         |  |                                                                                                             
|         |  | PART IV                                                                                                      |  |         
|         |  |                                                                                                             
|Item 15. |  | EXHIBITS AND FINANCIAL STATEMENT SCHEDULES                                                                   |  | 45      
|         |  |                                                                                                             
|         |  | SIGNATURES                                                                                                   |  | II-1    



i



---

##### Table of Contents

Forward-Looking Statements

This Annual Report on Form 10-K contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as
amended (the Securities Act) and Section 21E of the Securities Exchange Act of 1934, as amended (the Exchange Act). Forward-looking statements relate to expectations concerning matters that are not historical facts.
Words such as projects, believes, anticipates, plans, expects, intends, strategy, continue, will, estimate, forecast
and similar words and expressions are intended to identify forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements contained herein are reasonable, these expectations or any of the
forward-looking statements could prove to be incorrect, and actual results could differ materially from those projected or assumed in the forward-looking statements. Our future financial condition and results of operations, as well as any
forward-looking statements, are subject to risks and uncertainties, including, but not limited to, the factors set forth under Item 1A. Risk Factors. All forward-looking statements and reasons why results may differ included in this
Annual Report on Form 10-K are made as of the date hereof, and we assume no obligation to update any such forward-looking statements or reasons why actual results may differ.

PART I



|ITEM 1. | BUSINESS
|------- | --------

Overview

TIBCO Software Inc. (TIBCO, the Company, we or us), a Delaware corporation, is a leading
independent provider of infrastructure software. Our standards-based software offerings enable customers to create flexible, configurable applications from software infrastructure and deliver real-time insights. We do this by:



| |  |  | Integrating and orchestrating software components known as services, stand alone applications, and various other streams of information;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Automating and optimizing business processes that span customers and partners operations; and
| | - |  | -----------------------------------------------------------------------------------------------



| |  |  | Detecting, interpreting, and visualizing significant patterns among streams of relevant business and system events.
| | - |  | -------------------------------------------------------------------------------------------------------------------

We provide these capabilities across a range of environments including physical and virtualized hardware, standards-based and proprietary,
computing grids and public or private clouds.

As the backbone of real-time data movement and business
process execution across the enterprise, TIBCOs software is uniquely capable of correlating, in real-time, information about an organizations operations and performance with real-time information about expected behavior and business
rules. This correlation of real-time events with expected behaviors allows a company to anticipate customer needs capitalize on new opportunities, and avoid potential problems in a faster and more beneficial way than through more traditional,
transaction-oriented applications. Our solutions help customers extend the life of past investments made, operate their business more efficiently, and better capitalize on opportunities to increase revenue and market share. Using our software,
customers have the information they need to constantly innovate and make faster and smarter decisionswhat we call The Power of Now®.

We are the successor
to a portion of the business of Teknekron Software Systems, Inc. (Teknekron). Teknekron developed software, known as The Information Bus® (TIB) technology, for the integration and delivery of market data, such as stock quotes, news and other financial information, in trading rooms of large
banks and financial services institutions. In 1992, Teknekron expanded its development efforts to include solutions designed to enable complex and disparate manufacturing equipment and software applications, primarily in the semiconductor
fabrication market, to communicate within the factory environment. Teknekron



1



---

##### Table of Contents

was acquired by Reuters Group PLC (Reuters), the global information company, in 1994. Following the acquisition, continued development of the TIB® technology was undertaken to expand its use in the financial services markets.

In January 1997, TIBCO was established as an entity separate from Teknekron. We were formed to create and market software solutions for use
in the integration of business information, processes and applications. In connection with our establishment as a separate entity, Reuters transferred to us certain assets and liabilities related to our business and granted to us a royalty-free
license to the intellectual property from which some of our messaging software products originated.

Trademarks

TIBCO, TIBCO Software, The Information Bus, TIB, The Power of Now, Spotfire, Insightful, DataSynapse and Foresight are the trademarks or
registered trademarks of TIBCO Software Inc. in the United States and other countries. This Annual Report on Form 10-K also refers to the trademarks of other companies.

Products

We offer a wide range of software products that can be sold
individually to solve specific technical challenges, but the emphasis of our product development and sales efforts is to create products that interoperate and can be sold together as a suite to enable businesses to be more cost-effective, agile and
efficient. We divide our products into three major groups: service-oriented architecture (SOA), business optimization and business process management (BPM).



| |  |  | SOA: Our software helps organizations migrate to an IT infrastructure made up of services that can be assembled, orchestrated and reused. SOA
turns information and functions into discrete and reusable components that can be invoked from across the business and aggregated with other such services to create infrastructure applications. This helps companies streamline the
integration and orchestration of assets across technological, organizational and geographical boundaries. Our software enables the creation, management and virtualization of heterogeneous services and provides a unified environment for policy and
service management. It also delivers capabilities in the areas of service mediation, orchestration and communication and the development of rich internet applications. Our products give companies the flexibility to do these things using the
standards or technologies that best meet their needs in specific situations (such as HTTP, e-mail, J2EE, EDI, Messaging, .NET, Web Services, etc.) without replacing existing technologies or committing to any one technology across the enterprise.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Business optimization: Our software helps organizations convert and analyze data to create meaningful information and deliver it to employees,
customers and partners. Our software also tracks large volumes of real-time events as they occur and applies sophisticated rules in order to identify patterns that signify problems, threats and opportunities, and can automatically initiate
appropriate notifications or adaptations of processes. This helps line-level employees perform their jobs, helps managers identify and analyze problems and opportunities, and gives customers the ability to get accurate and consistent information
directly or through salespeople, service personnel or customer care representatives.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | BPM: Our software helps organizations better coordinate the process flows that control how their assets work together. This software can
coordinate the human and electronic resources inside a business and its network of customers and partners. Our products not only automate routine tasks and exception handling, but orchestrate long-lived activities and transactions that cut across
organizational and geographical boundaries. Our software enables organizations to provide a higher level of customer satisfaction, retain customers, maximize partnerships with other businesses and out-execute their competitors.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



2



---

##### Table of Contents

Our products are currently licensed by companies worldwide in diverse industries such as
energy, financial services, government, insurance, life science, manufacturing, retail, telecommunications, and transportation and logistics. We sell our products through a direct sales force and through alliances with leading software vendors and
systems integrators.

Services

Professional Services

Our professional services offerings include a wide
range of consulting services such as systems planning and design, installation and systems integration for the rapid deployment of TIBCO products. We offer our professional services with the initial deployment of our products as well as on an
ongoing basis to address the continuing needs of our customers. Our professional services staff is located throughout the Americas; Europe, the Middle East and Africa (EMEA); and Asia Pacific and Japan (APJ) enabling us to
perform installations and respond to customer demands rapidly across our global customer base. Many of our professional services employees have advanced degrees, substantial TIBCO experience and industry expertise in systems architecture and design;
additionally, many also have domain expertise in financial services, telecommunications, manufacturing, energy, logistics, life sciences and other industries.

We also have relationships with resellers, professional service organizations and system integrators including Accenture, Atos Origin, CapGemini, Deloitte Consulting, HP Enterprise Services, HCL
Technologies and Infosys Technologies, which include their participation in the deployment of our products to customers. These relationships help promote TIBCO products and provide additional technical expertise to enable us to provide the full
range of professional services our customers require to deploy our products.

Maintenance and Support

We offer a suite of software support and maintenance options that are designed to meet the needs of our diverse customer base. These support
options include 24 hour coverage that is available seven days a week, 365 days a year, to meet the needs of our global customers. To accomplish this level of support we have established a worldwide support organization with major support centers in
Palo Alto, California; London and Swindon, England; Woy Woy, Australia; Beijing, China; and Pune, India. These centers, working in conjunction with several smaller support offices located throughout the Americas, EMEA and APJ, provide seamless
support using a follow-the-sun support model.

In addition to support teams around the globe, we have a customer
support website that provides our customers with the ability to submit service requests, receive confirmations on opened service requests and obtain current status on these requests. Additionally, the customer support website provides access to our
support procedures, escalation numbers and late breaking news (LBN). LBN is used to provide updates and new information about our products. It also provides customers with information on generally known problems and suggested solutions
or workarounds that may be available.

Training

We provide a comprehensive and global training program for customers and partners through regional technical learning centers, customer
dedicated training, live online training, and self paced eLearning. Training is available at our main office in Palo Alto, California and at major training centers in Atlanta, Georgia; Maidenhead, England; Munich, Germany; Sydney, Australia and
Singapore. Additionally, TIBCO offers a variety of flexible programs designed to meet the training needs of individuals and companies. Our Educational Services group has the capability to develop efficient and effective training solutions to address
the specific needs of individual customers and partners. Our curriculum leads to an industry recognized technical certification in core TIBCO technologies.



3



---

##### Table of Contents

Sales

We currently market our software and services primarily through a direct sales organization complemented by indirect sales channels. Our direct sales force is located throughout the Americas, EMEA and APJ
and operates globally through our foreign subsidiaries.

Our revenue consists of license and service and maintenance fees from
our customers and distributors. License fees represented approximately 40%, 42% and 45% of our total revenue in fiscal years 2009, 2008 and 2007, respectively. Revenue from service and maintenance represented approximately 60%, 58% and 55% of our
total revenue in fiscal years 2009, 2008 and 2007, respectively.

Sales to customers outside the United States totaled $342.2
million, representing 55% of our total revenue in fiscal year 2009. For a geographic breakdown of our revenue and property and equipment, see Note 22 to our Consolidated Financial Statements included in this Annual Report on Form 10-K.

Marketing

We use a mix
of market research, analyst updates, seminars, direct mail, print advertising, trade shows, speaking engagements, public relations, customer newsletters and web marketing in order to achieve our marketing goals. Our marketing department also
produces collateral material for distribution to potential customers including presentation materials, white papers, brochures, magazines and fact sheets. We also host user events for our customers and provide support to our channel partners with a
variety of programs, training and product marketing support materials.

Seasonality and Quarterly Order Flow

Our business is subject to variations throughout the year due to seasonal factors in the United States and worldwide. These factors include
fewer selling days during the summer vacation season, the impact of the December holidays and a slowdown in capital expenditures by our customers after calendar year-end (during our first fiscal quarter). These factors typically constrain sales
activity in our first and third fiscal quarters compared to the rest of the year, and they make quarter-to-quarter comparisons of our operating results less meaningful.

Additionally, a substantial portion of our product license orders are usually received in the last month of each fiscal quarter, with a concentration of such orders in the final two weeks of the quarter.
We typically ship product licenses shortly after the receipt of an order and may have license orders that have not shipped at the end of any given quarter. Because the amount of such product license orders may vary, the amount, if any, of such
orders at the end of a particular quarter is not a reliable predictor of our future performance.

Competition

The market for our products and services is extremely competitive and subject to rapid change. While we offer a comprehensive suite of
integration solutions and believe we are a market leader among infrastructure software companies, we compete with various providers of infrastructure software including IBM, Oracle, Pegasystems, Progress Software, SAP, and Software AG. We offer a
complete suite of infrastructure software products, but IBM, Oracle and SAP offer products outside our segment and routinely bundle their broader set of products with their infrastructure software products. We expect additional competition from
other established and emerging companies. In addition, we may face pricing pressures from our current competitors and new market entrants in the future. We believe that the competitive factors affecting the market for our products and services
include product functionality and features, quality of professional services offerings, performance and price, ease of product implementation, quality of customer support services, customer training and documentation, and vendor and product
reputation. The relative importance of each of these factors depends upon the specific customer environment. We believe that our products and services currently compete favorably with respect to such factors. However, we may not be able to maintain
our competitive position against current and potential competitors.



4



---

##### Table of Contents

Research and Development

Our success is heavily dependent upon our ability to develop new products and technologies and to enhance our existing products. We expect
that a majority of our research and development activities will focus on enhancing and extending our TIBCO products and that such enhancements and new products will be developed internally. However, as part of our development strategy, we may also
license or acquire externally developed technologies for inclusion in our product solutions. We expect that we will continue to commit significant resources to product development in the future. Product development costs are recorded as research and
development expenses. Our research and development expenses, including stock-based compensation expense, were $108.7 million, $106.6 million and $92.9 million in fiscal years 2009, 2008 and 2007, respectively. To date, all product development costs
have been expensed as incurred, because the time period between achieving technological feasibility for a product and the general availability of such product has typically been very short.

Proprietary Technology

Our
success is dependent upon our proprietary software technology. We believe that factors such as the technological and creative skills of our personnel, product enhancements and new product developments are all essential to establishing and
maintaining a technology leadership position. We hold numerous United States and foreign patents and have several pending patent applications. We additionally license some patents from Reuters on a royalty-free basis. These patent rights
notwithstanding, we currently rely primarily on trade secret rights, copyright and trademark laws, and nondisclosure and other contractual agreements to protect our technology. We enter into confidentiality and/or license agreements with our
employees, distributors and customers, and limit access to and distribution of our software, documentation and other proprietary information. Despite these protective measures, third parties could still copy and use our products or otherwise
misappropriate our technology.

Furthermore, third parties might independently develop competing technologies that include the
same functionality or features, or otherwise are substantially equivalent or superior to our technologies. In addition, effective patent, copyright, trademark and trade secret protection may be unavailable or limited in certain foreign countries
where we operate. Our business could suffer serious harm if we fail to protect our proprietary technology.

Employees

As of November 30, 2009, we employed 2,097 persons, including 662 in sales and marketing, 572 in research and development, 264 in
general and administrative and 599 in professional services and technical support. Of our 2,097 employees, 1,141 were located in the Americas, 556 in EMEA and 400 in APJ. Our success is highly dependent on our ability to attract and retain qualified
employees. Competition for employees is intense in the software industry. To date, we believe we have been successful in our efforts to recruit qualified employees, but there is no assurance that we will continue to be as successful in the future.

Available Information

Our principal internet address is www.tibco.com. Our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to reports filed pursuant to Sections
13(a) and 15(d) of the Securities Exchange Act of 1934, as amended, are filed with the United States Securities and Exchange Commission (the SEC). Such reports and other information filed by us with the SEC are available on the
Investor Information page of our website at http://www.tibco.com/company/investor_info when such reports are available on the SEC website. The public may read and copy any materials we have filed with the SEC at the SECs Public
Reference Room at 100 F Street, NE, Washington, DC 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains an Internet site that contains reports, proxy, and
information statements and other information regarding issuers that file electronically with the SEC at http://www.sec.gov. The contents of these websites are not incorporated into



5



---

##### Table of Contents

this filing. Further, the references to the URLs for these websites are intended to be inactive textual references only.



|ITEM 1A.    RISK | FACTORS
|---------------- | -------

In addition
to the factors discussed elsewhere in this Form 10-K, the following risk factors, as well as other factors of which we may be unaware or do not currently view as significant, could materially and adversely affect our future operating results and
could cause actual events to differ materially from those predicted in the forward-looking statements we make about our business.

Economic and market conditions may continue to adversely affect our operating results.

The current domestic
and global economic downturn has resulted in reduced demand for information technology, including enterprise software and services. It is unknown how long the conditions will persist or whether they will worsen. Information technology spending has
historically declined as general economic and market conditions have worsened. During challenging and uncertain economic times and in tight credit markets, many customers delay or reduce technology purchases. Contract negotiations may become more
protracted or difficult if customers institute additional internal approvals for technology purchases or require more negotiation of contract terms and conditions. These economic conditions could result in reductions in sales of our products, longer
sales cycles, difficulties in collection of accounts receivable or delayed payments, slower adoption of new technologies and increased price competition. During the current economic slowdown, we have experienced, and may continue to experience,
reduced demand for enterprise software which has resulted in a reduction in our license revenue and in the rate at which our customers renew their maintenance agreements and procure consulting services.

In addition, the current economic downturn has resulted in a tightening in the credit markets, a low level of liquidity in many financial
markets, and extreme volatility in credit, equity, currency and fixed income markets. These macroeconomic developments have negatively affected, and may continue to negatively affect, our business, operating results or financial conditions in
various ways, including reducing the ability of customers to obtain credit to finance purchases of our products; increasing the number of customer insolvencies; decreasing customer demand; and decreasing customer ability to pay trade obligations.
Financial institution difficulties and/or failures may also make it more difficult or expensive to obtain financing for our operations, investing activities (including potential acquisitions) or financing activities.

Our future revenue is unpredictable, and we expect our quarterly operating results to fluctuate, which may cause our stock price to decline.

As a result of the evolving nature of the markets in which we compete and the size of our customer agreements, we have
difficulty accurately forecasting our revenue in any given period. In addition to the factors discussed elsewhere in this section, a number of factors may cause our revenue to fall short of our expectations, or those of stock market analysts and
investors, or cause fluctuations in our operating results, including:



| |  |  | the relatively long sales cycles for many of our products;
| | - |  | ----------------------------------------------------------



| |  |  | the timing of our new products or product enhancements or any delays in such introductions;
| | - |  | -------------------------------------------------------------------------------------------



| |  |  | the delay or deferral of customer implementation of our products;
| | - |  | -----------------------------------------------------------------



| |  |  | changes in customer budgets and decision making processes that could affect both the timing and size of any transaction;
| | - |  | ------------------------------------------------------------------------------------------------------------------------



| |  |  | reduced spending in the industries that license our products;
| | - |  | -------------------------------------------------------------



| |  |  | our dependence on large deals, which, if such deals do not close, can greatly impact revenues for a particular quarter;
| | - |  | -----------------------------------------------------------------------------------------------------------------------



| |  |  | the timing, size and mix of orders from customers;
| | - |  | --------------------------------------------------



6



---

##### Table of Contents

| |  |  | the deferral of license revenue to future periods due to the timing of the execution of an agreement or our ability to deliver the products;
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the impact of our provision of services and customer-required contractual terms on our recognition of license revenue;
| | - |  | ----------------------------------------------------------------------------------------------------------------------



| |  |  | any unanticipated difficulty we encounter in integrating acquired businesses, products or technologies;
| | - |  | -------------------------------------------------------------------------------------------------------



| |  |  | the tendency of some of our customers to wait until the end of a fiscal quarter or our fiscal year in the hope of obtaining more favorable terms;
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the amount and timing of operating costs and capital expenditures relating to the expansion of our operations and the evaluation of strategic
transactions; and
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | changes in accounting rules, such as recording expenses for employee stock option grants and tax accounting, including accounting for uncertain tax
positions.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------

A substantial portion of our product license orders are usually received in the last month of
each fiscal quarter, with a concentration of such orders in the final two weeks of the quarter. While we typically ship product licenses shortly after the receipt of an order, we may have license orders that have not shipped at the end of any given
quarter. Because the amount of such product license orders may vary, the amount, if any, of such orders at the end of a particular quarter is not a reliable predictor of our future performance.

Because it is difficult for us to predict our quarterly operating results, period-to-period comparisons of our operating results may not be
a good indication of our future performance. If, as a result of these difficulties, our revenues and operating results do not meet the expectations of our investors or securities analysts or fall below guidance we may provide to the market, the
price of our common stock may decline.

Uneven growth and periods of contraction in the infrastructure software market have caused our
revenue to decline in the past and could cause our revenue or results of operations to fall below expectations in the future.

We earn a substantial portion of our revenue from licenses of our infrastructure software, including application integration software and sales of related services. We expect to earn substantially all of our revenue in the foreseeable
future from sales of this software and the related services. Our future financial performance will depend on continued growth in the number of organizations demanding software and services for application integration and information delivery and
companies seeking outside vendors to develop, manage and maintain this software for their critical applications. Lower spending by corporate and governmental customers around the world, which has had a disproportionate impact on information
technology spending, has led to a reduction in sales in the past and may continue to do so in the future. Many of our potential customers have made significant investments in internally developed systems and would incur significant costs in
switching to third-party products, which may substantially inhibit the growth of the market for infrastructure software. If the market fails to grow, or grows more slowly than we expect, our sales will be adversely affected. Also, even if corporate
and governmental spending increases and companies make greater investments in information technology and infrastructure software, our revenue may not grow at the same pace.

Our success depends on our ability to overcome significant competition.

The market for our products and services is extremely competitive and subject to rapid change. We compete with a variety of large and small providers of infrastructure software, SOA, business optimization and BPM, including companies such
as IBM, Oracle, Pegasystems, Progress Software, SAP, and Software AG. We believe that of these companies, IBM has the potential to offer the most complete competitive set of products relative to our offerings. In addition, companies such as IBM,
Oracle and SAP offer products outside our segment and routinely bundle their broader set of products with their infrastructure software products. Further, some of our competitors are expanding their competitive product offerings and market position
through acquisitions and



7



---

##### Table of Contents

internal research and development. We expect additional competition from other established and emerging companies. We also face competition for certain aspects of our product and service
offerings from major systems integrators. Further, we may face increasing competition from open source software providers, such as MuleSource, that provide software and intellectual property, typically without charging license fees, or from other
competitors offering products through alternative business models, such as software as a service. If customers choose such alternatives over our proprietary software, our revenues and earnings could be adversely affected.

Many of our current and potential competitors have longer operating histories, significantly greater financial, technical, product
development and marketing resources, greater name recognition, and larger customer bases than we do. Continued consolidation in the software market may further strengthen our larger competitors. Our present or future competitors may be able to
develop products comparable or superior to those we offer, adapt more quickly than we do to new technologies, evolving industry trends or customer requirements, or devote greater resources to the development, promotion and sale of their products
than we do. Accordingly, we may not be able to compete effectively in our markets or competition may intensify and harm our business and operating results.

We may not be able to successfully offer products and enhancements that respond to emerging technological trends and customers needs.

If we are not successful in developing enhancements to existing products and new products in a timely manner, achieving customer acceptance
for our existing and new product offerings or generating higher average selling prices, our gross margins may decline, and our business and operating results may suffer. Furthermore, any of our new product offerings or significant enhancements
to current product offerings could cause some customers to delay making new or additional purchases while they fully evaluate any new offerings we might have introduced to the market, which in turn may slow sales and adversely affect operating
results for an indeterminate period of time. Also, we may not execute successfully on our product plans because of errors in product planning or timing, technical hurdles that we fail to overcome in a timely fashion or a lack of appropriate
resources. This could result in competitors providing those solutions before us and loss of market share, net sales and earnings.

Our
stock price may be volatile, which could cause investors to incur significant losses.

The stock market in general and the
stock prices of technology companies in particular, have experienced volatility which has often been unrelated to the operating performance of any particular company or companies. Some of the factors that may affect our common stock price other than
our operating results include:



| |  |  | uncertainty about current global economic or political conditions;
| | - |  | ------------------------------------------------------------------



| |  |  | general volatility in the capital markets;
| | - |  | ------------------------------------------



| |  |  | business developments by us or our competitors, including material acquisitions or dispositions and strategic investments;
| | - |  | --------------------------------------------------------------------------------------------------------------------------



| |  |  | industry developments and announcements by us or our competitors;
| | - |  | -----------------------------------------------------------------



| |  |  | changes in estimates and recommendations by securities analysts;
| | - |  | ----------------------------------------------------------------



| |  |  | speculation in the press or investment community; and
| | - |  | -----------------------------------------------------



| |  |  | changes in the accounting rules.
| | - |  | --------------------------------

Since December 1, 2008, our stock price has fluctuated between a low of $4.12 and a high of $10.18. If market or industry-based fluctuations continue, our stock price could decline in the future
regardless of our actual operating performance and investors could incur significant losses.



8



---

##### Table of Contents

Changes in foreign currency exchange rates could negatively affect our operating results.

In addition to receiving revenue and incurring expenses in U.S. dollars, we also receive revenue and incur expenses in approximately
twenty foreign currencies. Our revenue, expenses and net income are impacted by foreign exchange rate fluctuations against the U.S. dollar. For example, customers in foreign countries may incur higher costs due to the strengthening of the U.S.
dollar, which could result in a delay of payments or a default on credit extended to them. Any material delay or default in our collection of significant accounts could have a negative result on our results of operations. Additionally, any
strengthening of the U.S. dollar could require us to offer discounts, reduce pricing or offer other incentives to mitigate any negative effects on demand from such rise in the U.S. dollar.

We enter into foreign currency forward contracts, the majority of which mature within approximately one month, in an effort to manage our
exposure from changes in value of certain foreign currency denominated net assets and liabilities. Our foreign currency forward contracts are intended to reduce, but do not eliminate, the impact of currency exchange rate movements. For example, we
do not execute forward contracts in all currencies in which we conduct business. In addition, our hedging program may not reduce the impact of short-term or long-term volatility in foreign exchange rates. Accordingly, amounts denominated in such
foreign currencies may fluctuate in value and produce significant earnings and cash flow volatility.

Our strategy contemplates future
acquisitions that may result in us incurring unanticipated expenses or additional debt, difficulty in integrating our operations and dilution to our stockholders and may harm our operating results.

Our success depends in part on our ability to continually enhance and broaden our product offerings in response to changing technologies,
customer demands and competitive pressures. We expect to acquire complementary businesses, products or technologies in the future as part of our corporate strategy. In this regard, we have made strategic acquisitions, including the acquisition of
Foresight Corporation in December 2009, DataSynapse, Inc. in August 2009, Insightful Corporation in fiscal year 2008 and Spotfire Holdings, Inc. in fiscal year 2007. We do not know if we will be able to complete any future acquisitions or that we
will be able to successfully integrate any acquired business, operate it profitably or retain its key employees. Integrating any newly acquired business, product or technology could be expensive and time-consuming, could disrupt our ongoing business
and financial performance and could distract our management. Therefore, we may not be able, either immediately post-acquisition or ever, to replicate the pre-acquisition revenues achieved by companies that we acquire or achieve the benefits of the
acquisition we anticipated in valuing the businesses, products or technologies we acquire. Furthermore, the costs of integrating acquired companies in international transactions can be particularly high, due to local laws and regulations. If we are
unable to integrate any newly acquired entity, products or technology effectively, our business, financial condition and operating results would suffer. In addition, any amortization or impairment of acquired intangible assets, stock-based
compensation or other charges resulting from the costs of acquisitions could harm our operating results.

In addition, we may
face competition for acquisition targets from larger and more established companies with greater financial resources. Also, in order to finance any acquisition, we may need to raise additional funds through public or private financings or use our
cash reserves. In that event, we could be forced to obtain equity or debt financing on terms that are not favorable to us or that result in dilution to our stockholders. Use of our cash reserves for acquisitions could limit our financial flexibility
in the future. The terms of existing or future loan agreements may place limits on our ability to incur additional debt to finance acquisitions. If we are not able to acquire strategically attractive businesses, products or technologies, we may not
be able to remain competitive in our industry or achieve our overall growth plans.

Continued increases in consulting and training services
revenue may decrease overall margins.

We have historically realized, and may continue in the future to realize, an
increasingly high percentage of our revenue from services, which has a lower profit margin than license or maintenance revenue. As a result, if



9



---

##### Table of Contents

consulting and training services revenue increases as a percentage of total revenue, our overall profit margin may decrease, which could impact our stock price.

Because we have reduced the amount of equity used to compensate employees, we may need to use a proportionately greater amount of cash to attract and
retain employees, negatively impacting our profit margin.

In response to market demands, we have reduced the percentage of
outstanding shares used in our equity incentive programs. This has resulted in a significant reduction in the number of shares available to grant to existing and prospective employees. In addition, the decline in our stock price has in the past, and
may in the future, require us to grant larger individual equity awards to convey a certain level of compensation to existing and prospective employees. As a result, we have increased, and will continue to increase, the amount of cash used to create
short term and long term incentive programs. Because there is not a potential for cash to appreciate in value as an equity award may appreciate, we may need to use a proportionately greater amount of cash to convey the same real or perceived value
that is conveyed through the use of equity awards. This proportionately greater use of cash could negatively affect our profit margins.

If
we cannot successfully recruit, retain and integrate highly skilled employees, we may not be able to execute our business strategy effectively.

If we fail to retain and recruit key management, sales and other skilled employees, our business and our ability to obtain new customers, develop new products and provide acceptable levels of customer
service could suffer. As we grow, we must invest significantly in building our sales, marketing and engineering groups. Competition for these people in the software industry is intense, and we may not be able to successfully recruit, train or retain
qualified personnel. We are competing against companies with greater financial resources and name recognition for these employees, and as such, there is no assurance that we will be able to meet our hiring needs or hire the most qualified
candidates. The success of our business is also heavily dependent on the leadership of our key management personnel, including Vivek Ranadivé, our Chairman and Chief Executive Officer. The loss of one or more key employees could adversely
affect our continued operations.

In addition, we must successfully integrate new employees into our operations and generate
sufficient revenues to justify the costs associated with these employees. If we fail to successfully integrate employees or to generate the revenue necessary to offset employee-related expenses, we may be forced to reduce our headcount, which could
force us to incur significant expenses and could harm our business and operating results.

The inability to upsell to our current customers
or the loss of any significant customer could harm our business and cause our stock price to decline.

We do not have
long-term sales contracts with any of our customers. Our customers may choose not to purchase our products or not to use our services in the future. As a result, a customer that generates substantial revenue for us in one period may not be a source
of revenue in subsequent periods. Any inability on our part to upsell to and generate revenues from our existing customers or the loss of a significant customer could adversely affect our business and operating results.

Claims by others that our products may infringe their intellectual property rights may cause us to incur unexpected costs or prevent us from selling our
products.

Third parties may claim that certain of our products infringe their patents or other intellectual property
rights. In addition, our use of open source software components in our products may make us vulnerable to claims that our products infringe third-party intellectual property rights, in particular because many of the open source software components
we may incorporate with our products may be developed by numerous independent parties over whom we exercise no supervision or control. Open source software is software that is covered by a



10



---

##### Table of Contents

license agreement which permits the user to liberally copy, modify and distribute the software, typically free of charge. Further, because patent applications in the United States and many other
countries are not publicly disclosed at the time of filing, applications covering technology used in our software products may have been filed without our knowledge. We may be subject to legal proceedings and claims from time to time, including
claims of alleged infringement of the patents, trademarks and other intellectual property rights of third parties by us or our licensees in connection with their use of our products. Our software license agreements typically provide for
indemnification of our customers for intellectual property infringement claims. Intellectual property litigation, with or without merit, is expensive and time consuming, could cause product shipment delays and could divert our managements
attention away from running our business and seriously harm our business. If we were to discover that our products violated the intellectual property rights of others, we would have to obtain licenses from these parties, which could require the
payment of royalty or licensing fees, in order to continue marketing our products without substantial reengineering. We might not be able to obtain the necessary licenses on acceptable terms or at all, and if we could not obtain such licenses, we
might not be able to reengineer our products successfully or in a timely fashion. If we fail to address any infringement issues successfully, we would be forced to incur significant costs, including damages and potentially satisfying indemnification
obligations that we have with our customers, and we could be prevented from selling certain of our products.

Our intellectual property or
proprietary rights could be misappropriated, which could force us to become involved in expensive and time-consuming litigation.

We regard our intellectual property as critical to our success. Accordingly, we rely upon a combination of copyrights, service marks, trademarks, trade secret rights, patents, confidentiality agreements and licensing agreements to protect
our intellectual property. Despite these protections, a third party could misappropriate our intellectual property. Any misappropriation of our proprietary information by third parties could harm our business, financial condition and operating
results.

In addition, the laws of some countries do not provide the same level of protection of our proprietary information
as do the laws of the United States. If our proprietary information or material were misappropriated or challenged, we might have to engage in litigation to protect it. We might not succeed in protecting our proprietary information if we initiate
intellectual property litigation, and, in any event, such litigation would be expensive and time-consuming, could divert our managements attention away from running our business and could seriously harm our business.

The use of open source software in our products may expose us to additional risks.

Certain open source software is licensed pursuant to license agreements that require a user who distributes the open source software as a
component of the users software to disclose publicly part or all of the source code to the users software. This effectively renders what was previously proprietary software open source software. As competition in our markets increases,
we must strive to be cost-effective in our product development activities. Many features we may wish to add to our products in the future may be available as open source software and our development team may wish to make use of this software to
reduce development costs and speed up the development process. While we carefully monitor the use of all open source software and try to ensure that no open source software is used in such a way as to require us to disclose the source code to the
related product, such use could inadvertently occur. Additionally, if a third party has incorporated certain types of open source software into its software but has failed to disclose the presence of such open source software and we embed that third
party software into one or more of our products, we could, under certain circumstances, be required to disclose the source code to our product. This could have a material adverse effect on our business.



11



---

##### Table of Contents

Market acceptance of new platforms, standards and technologies may require us to undergo the expense of
developing and maintaining compatible product solutions.

Our software products can be licensed for use with a variety of
platforms, standards and technologies, and we are constantly evaluating the feasibility of adding new platforms, standards and technologies. There may be future or existing platforms, standards and technologies that achieve popularity in the
marketplace which may not be architecturally compatible with our software products. In addition, the effort and expense of developing, testing and maintaining software products will increase as more platforms, standards and technologies achieve
market acceptance within our target markets. If we are unable to achieve market acceptance of our software products or adapt to new platforms, standards and technologies, our sales and revenues will be adversely affected.

Developing and maintaining different software products could place a significant strain on our resources and software product release
schedules, which could harm our revenue and financial condition. If we are not able to develop software for accepted platforms, standards and technologies, our license and service revenues and our gross margins could be adversely affected. In
addition, if the platforms, standards and technologies we have developed software for are not accepted, our license and service revenues and our gross margins could be adversely affected.

If we fail to manage our exposure to financial and securities market risk successfully, our operating results could be adversely impacted.

We are exposed to financial market risks, including changes in interest rates, credit markets and prices of marketable
equity and fixed-income securities. We do not use derivative financial instruments for speculative or trading purposes.

The
primary objective of most of our investment activities is to preserve principal while at the same time maximizing yields without significantly increasing risk. To achieve this objective, our marketable investments are primarily investment grade,
liquid, fixed-income securities and money market instruments denominated in U.S. dollars. If the carrying value of our investments exceeds the fair value, and the decline in fair value is deemed to be other-than-temporary, we will be required to
further write down the value of our investments, which could materially harm our results of operations and financial condition. Moreover, the performance of certain securities in our investment portfolio correlates with the credit condition of the
United States financial sector. With the current unstable credit environment, we may incur significant realized, unrealized or impairment losses associated with these investments.

We may incur impairments to goodwill, intangible or long-lived assets.

We
review our goodwill, intangible and long-lived assets for impairment annually in the fourth quarter or whenever events or changes in circumstances indicate that the carrying amount of these assets may not be recoverable.

Significant negative industry or economic trends, a decline in the market price of our common stock, reduced estimates of future cash flows
or disruptions to our business could indicate that goodwill, intangible or long-lived assets might be impaired. If, in any period, our stock price decreases to the point where our market capitalization is less than our book value, this too could
indicate a potential impairment and we may be required to record an impairment charge in that period.

Our valuation
methodology for assessing impairment requires management to make judgments and assumptions based on historical experience and to rely on projections of future operating performance. We operate in highly competitive environments and projections of
future operating results and cash flows may vary significantly from results. Additionally, if our analysis results in an impairment to our goodwill, we would be required to record a non-cash charge to earnings in our financial statements during a
period in which such impairment is determined to exist.



12



---

##### Table of Contents

Any of these factors could have a negative impact on our revenues and our operating results.

Any losses we incur as a result of our exposure to the credit risk of our customers and partners could harm our results of operations.

We monitor individual customer payment capability in granting credit arrangements, seek to limit credit to amounts we
believe the customers can pay, and maintain reserves we believe are adequate to cover exposure for doubtful accounts. As we have grown our revenue and customer base, our exposure to credit risk has increased. Any material losses we incur as a result
of customer defaults could have an adverse effect on our business, operating results and financial condition.

Our debt agreements contain
certain restrictions that may limit our ability to operate our business.

The agreements governing our debt agreements
contain, and any other future debt agreement we enter into may contain, restrictive covenants that limit our ability to operate our business, including, in each case subject to certain exceptions, restrictions on our ability to:



| |  |  | incur indebtedness;
| | - |  | -------------------



| |  |  | incur indebtedness at the subsidiary level;
| | - |  | -------------------------------------------



| |  |  | grant liens;
| | - |  | ------------



| |  |  | enter into certain mergers or sell all or substantially all of our assets;
| | - |  | --------------------------------------------------------------------------



| |  |  | make certain payments on our equity, including paying dividends;
| | - |  | ----------------------------------------------------------------



| |  |  | make investments;
| | - |  | -----------------



| |  |  | change our business;
| | - |  | --------------------



| |  |  | enter into transactions with our affiliates; and
| | - |  | ------------------------------------------------



| |  |  | enter into certain restrictive agreements.
| | - |  | ------------------------------------------

In addition, our debt agreements contain financial covenants and additional affirmative and negative covenants. Our ability to comply with these covenants is dependent on our future performance, which
will be subject to many factors, some of which are beyond our control, including prevailing economic conditions. If we are not able to comply with all of these covenants for any reason and we have debt outstanding at the time of such failure, some
or all of our outstanding debt could become immediately due and payable and the incurrence of additional debt under the credit facilities would not be allowed. If our cash is utilized to repay any outstanding debt, depending on the amount of debt
outstanding, we could experience an immediate and significant reduction in working capital available to operate our business.

As a result of these covenants, our ability to respond to changes in business and economic conditions and to obtain additional financing, if needed, may be significantly restricted, and we may be prevented from engaging in transactions that
might otherwise be beneficial to us, such as strategic acquisitions or joint ventures.

We may have exposure to additional tax liabilities.

As a multinational corporation, we are subject to income taxes in the United States and various foreign jurisdictions.
Significant judgment is required in determining our global provision for income taxes and other tax liabilities. In the ordinary course of a global business, there are many intercompany transactions and calculations where the ultimate tax
determination is uncertain. Our income tax returns are routinely subject to audits by tax authorities. Although we regularly assess the likelihood of adverse outcomes resulting from these examinations to determine our tax estimates, a final
determination of tax audits or tax disputes could have an adverse effect on our results of operations and financial condition.



13



---

##### Table of Contents

We are also subject to non-income taxes, such as payroll, sales, use, value-added, net
worth, property and goods and services taxes in the United States and various foreign jurisdictions. We are regularly under audit by tax authorities with respect to these non-income taxes and may have exposure to additional non-income tax
liabilities which could have an adverse effect on our results of operations and financial condition.

In addition, our future
effective tax rates could be favorably or unfavorably affected by changes in tax rates, changes in the valuation of our deferred tax assets or liabilities, or changes in tax laws or their interpretation. Such changes could have a material adverse
impact on our financial results.

Changes in existing financial accounting standards or practices, or taxation rules or practices may
adversely affect our results of operations.

Changes in existing accounting or taxation rules or practices, new accounting
pronouncements or taxation rules, or varying interpretations of current accounting pronouncements or taxation practice could have a significant adverse effect on our results of operations or the manner in which we conduct our business. Further, such
changes could potentially affect our reporting of transactions completed before such changes are effective. For example, on December 1, 2009, we adopted revised accounting guidance for business combinations which requires acquisition-related
costs to be expensed as incurred, restructuring costs generally to be expensed in periods subsequent to the acquisition date, in-process research and development to be capitalized as an intangible asset with an indefinite life, and changes in
accounting for deferred tax asset valuation allowances and acquired income tax uncertainties after the measurement period, which will impact income tax expense. The impact the guidance will have on our consolidated financial position, results of
operations and cash flows will be dependent on the number and size of business combinations that we consummate subsequent to the adoption of the standard, as well as the valuation and allocation of the net assets acquired.

We operate internationally and face risks attendant to those operations.

We earn a significant portion of our total revenues from international sales generated through our foreign direct and indirect operations. As
a result of these sales operations, we face a variety of risks, including:



| |  |  | local political and economic instability;
| | - |  | -----------------------------------------



| |  |  | varying regulatory requirements;
| | - |  | --------------------------------



| |  |  | compliance with international and local trade, labor and other laws including the Foreign Corrupt Practices Act and export control laws;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------



| |  |  | restrictions on the transfer of funds;
| | - |  | --------------------------------------



| |  |  | currency exchange rate fluctuations;
| | - |  | ------------------------------------



| |  |  | managing our international operations; and
| | - |  | ------------------------------------------



| |  |  | longer payment cycles, collecting receivables in a timely fashion and repatriating earnings.
| | - |  | --------------------------------------------------------------------------------------------

Any of these factors, either individually or in combination, could materially impact our international operations and adversely affect our
business as a whole.

If we fail to maintain an effective system of internal controls, we may not be able to accurately report our
financial results or prevent fraud.

Section 404 of the Sarbanes-Oxley Act requires that management report annually on
the effectiveness of our internal control over financial reporting and identify any material weaknesses in our internal control and financial reporting environment. If management identifies any material weaknesses, their correction could require
remedial measures which could be costly and time-consuming. In addition, the presence of material weaknesses could result in financial statement errors which in turn could require us to restate our operating results. Any



14



---

##### Table of Contents

identification by us or our independent registered public accounting firm of material weaknesses, even if quickly remedied, could damage investor confidence in the accuracy and completeness of
our financial reports, which could affect our stock price and potentially subject us to litigation.

The continuous process of
maintaining and adapting our internal controls and complying with Section 404 is expensive and time-consuming, and requires significant management attention. We cannot be sure that our internal control measures will continue to provide adequate
control over our financial processes and reporting and ensure compliance with Section 404. Any failure by us to comply with Section 404 could subject us to a variety of administrative sanctions, which could reduce our stock price.

Any unauthorized, and potentially improper, actions of our personnel could adversely affect our business, operating results and financial
condition.

The recognition of our revenue depends on, among other things, the terms negotiated in our contracts with our
customers. Our personnel may act outside of their authority and negotiate additional terms without our knowledge. We have implemented policies to help prevent and discourage such conduct, but there can be no assurance that such policies will be
followed. For instance, in the event that our sales personnel negotiate terms that do not appear in the contract and of which we are unaware, whether the additional terms are written or verbal, we could be prevented from recognizing revenue in
accordance with our plans. Furthermore, depending on when we learn of unauthorized actions and the size of transactions involved, we may have to restate revenue for a previously reported period, which would seriously harm our business, operating
results and financial condition.

The outcome of litigation pending against us could require us to expend significant resources and could
harm our business and financial resources.

Note 13 to our Condensed Consolidated Financial Statements included in this
Annual Report on Form 10-K describes the litigation pending against us and our directors and officers. The uncertainty associated with substantial unresolved lawsuits or future lawsuits could harm our business, financial condition and reputation.
The defense of the lawsuits could result in the diversion of our managements time and attention away from business operations, which could harm our business. Negative developments with respect to the lawsuits could cause our stock price to
decline. In addition, although we are unable to determine the amount, if any, that we may be required to pay in connection with the resolution of the current lawsuits or any future lawsuit by settlement or otherwise, any such payment could seriously
harm our financial condition and liquidity.

Our software may have defects and errors that could lead to a loss of revenues or product
liability claims.

Our products and platforms use complex technologies and, despite extensive testing and quality control
procedures, may contain defects or errors, especially when first introduced or when new versions or enhancements are released. If defects or errors are discovered after commercial release of either new versions or enhancements of our products and
platforms:



| |  |  | potential customers may delay purchases;
| | - |  | ----------------------------------------



| |  |  | customers may react negatively, which could reduce future sales;
| | - |  | ----------------------------------------------------------------



| |  |  | our reputation in the marketplace may be damaged;
| | - |  | -------------------------------------------------



| |  |  | we may have to defend product liability claims;
| | - |  | -----------------------------------------------



| |  |  | we may be required to indemnify our customers, distributors, original equipment manufacturers or other resellers;
| | - |  | -----------------------------------------------------------------------------------------------------------------



| |  |  | we may incur additional service and warranty costs; and
| | - |  | -------------------------------------------------------



| |  |  | we may have to divert additional development resources to correct the defects and errors, which may result in the delay of new product releases or
upgrades.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------



15



---

##### Table of Contents

If any or all of the foregoing occur, we may lose revenues, incur higher operating expenses
and lose market share, any of which could severely harm our financial condition and operating results.

Any failure by us to meet the
requirements of current or newly-targeted customers may have a detrimental impact on our business or operating results.

We
may wish to expand our customer base into markets in which we have limited experience. In some cases, customers in different markets, such as financial services or government, have specific regulatory or other requirements which we must meet. For
example, in order to maintain contracts with the United States government, we must comply with specific rules and regulations relating to and that govern such contracts. Government contracts are generally subject to audits and investigations which
could result in various civil and criminal penalties and administrative sanctions, including termination of contracts, refund of a portion of fees received, forfeiture of profits, suspension of payments, fines and suspensions or debarment from
future government business. If we fail to meet such requirements in the future, we could be subject to civil or criminal liability or a reduction of revenue which could harm our business, operating results and financial condition.

Natural or other disasters could disrupt our business and result in loss of revenue or in higher expenses.

Natural disasters, terrorist activities and other business disruptions could seriously harm our revenue and financial condition and increase
our costs and expenses. Our corporate headquarters and many of our operations are located in California, a seismically active region. In addition, many of our current and potential customers are concentrated in a few geographic areas. A natural
disaster in one of these regions could have a material adverse impact on our U.S. and foreign operations, operating results and financial condition. Further, any unanticipated business disruption caused by Internet security threats, damage to global
communication networks or otherwise could have a material adverse impact on our operating results.

Reuters has a royalty free license to
some of our products.

We license from Reuters the intellectual property that was incorporated into early versions of some
of our software products. We do not own this licensed technology. Because Reuters has access to intellectual property used in our products, it could use this intellectual property to compete with us. Reuters is not restricted from using the licensed
technology it has licensed to us to produce products that compete with our products, and it can grant limited licenses to the licensed technology to others who may compete with us. In addition, we must license to Reuters some of the products we own
and the source code for one of our messaging products through December 2012. This may place Reuters in a position to more easily develop products that compete with ours.

Some provisions in our certificate of incorporation and bylaws, as well as a stockholder rights plan, may have anti-takeover effects.

We have a stockholder rights plan providing for one right for each outstanding share of our common stock. Each right, when exercisable,
entitles the registered holder to purchase certain securities at a specified purchase price. The rights plan may have the anti-takeover effect of causing substantial dilution to a person or group that attempts to acquire TIBCO on terms not approved
by our Board of Directors. The existence of the rights plan could limit the price that certain investors might be willing to pay in the future for shares of our common stock and could discourage, delay or prevent a merger or acquisition that
stockholders may consider favorable. In addition, provisions of our current certificate of incorporation and bylaws, as well as Delaware corporate law, could make it more difficult for a third party to acquire us without the support of our Board of
Directors, even if doing so would be beneficial to our stockholders.



|ITEM 1B.    UNRESOLVED | STAFF COMMENTS
|---------------------- | --------------

None.



16



---

##### Table of Contents

|ITEM 2. | PROPERTIES
|------- | ----------

Our principal
administrative, sales, marketing, service and research and development facilities are located in a four building campus totaling approximately 292,000 square feet in Palo Alto, California, which we purchased in June 2003. In connection with the
purchase, we entered into a 51-year lease of the land upon which the buildings are located. Further information on the terms of the building acquisition can be found in Managements Discussion and Analysis of Financial Condition and
Results of Operation and Note 7 to our Consolidated Financial Statements included in this Annual Report on Form 10-K.

In addition to our Palo Alto campus, we lease facilities in Maidenhead, England, to serve as our EMEA headquarters; as well as Pune, India; Munich, Germany; Gothenburg, Sweden; and Sydney, Australia; which are primarily used for sales,
field support, or research and development. We also lease facilities in approximately 60 other cities throughout the world. Lease terms range from month-to-month on certain offices to ten years on certain direct leases. We are continuously
evaluating the adequacy of existing facilities and additional facilities in new cities, and we believe that suitable additional space will be available in the future on commercially reasonable terms as needed.

We have certain facilities under lease that are in excess of our requirements that we no longer occupy and do not intend to occupy.
Currently, the majority of these vacated facilities are occupied by our tenants; however, the subleases will expire in various lengths. The estimated loss on excess facilities net of sublease income has been included in the accrued excess facilities
costs on the Consolidated Balance Sheets as of November 30, 2009 and 2008.



|ITEM 3. | LEGAL PROCEEDINGS
|------- | -----------------

See
Note 13 to our Consolidated Financial Statements included in this Annual Report on Form 10-K for information responsive to this item.



|ITEM 4. | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
|------- | ---------------------------------------------------

No matters were submitted to a vote of security holders during the fourth quarter of fiscal year 2009.



17



---

##### Table of Contents

PART II



|ITEM 5. | MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
|------- | ------------------------------------------------------------------------------------------------------------

Market Information

Our
common stock is quoted on the NASDAQ Global Select Market (NASDAQ) under the symbol TIBX. The following table presents the high and low intra-day sale prices of our common stock on NASDAQ during the fiscal quarters indicated:



|                                       |  |      |       |     |   |     
|-------------------------------------- |  | ---- | ----- | --- | - | ----
|Fiscal Year 2009                       |  | High |       | Low
|First quarter ended February 1, 2009   |  | $    | 7.34  |     | $ | 4.12
|Second quarter ended May 31, 2009      |  | $    | 7.12  |     | $ | 4.38
|Third quarter ended August 30, 2009    |  | $    | 9.87  |     | $ | 6.07
|Fourth quarter ended November 30, 2009 |  | $    | 10.18 |     | $ | 8.40
|                                       |  |     
|Fiscal Year 2008                       |  |      |       |    
|First quarter ended February 2, 2008   |  | $    | 8.23  |     | $ | 6.50
|Second quarter ended June 1, 2008      |  | $    | 8.67  |     | $ | 6.76
|Third quarter ended August 31, 2008    |  | $    | 8.78  |     | $ | 6.89
|Fourth quarter ended November 30, 2008 |  | $    | 8.43  |     | $ | 3.45

Holders of Record

As of January 15, 2010, there were approximately 1,570 stockholders of record of our common stock.

Dividends

We have never
declared or paid any cash dividends on our common stock, and we do not anticipate paying any cash dividends in the foreseeable future.

Equity Compensation Plan Information

The following table sets forth information about our common stock that
may be issued upon the exercise of options, warrants and rights under all of our existing equity compensation plans as of November 30, 2009.



|                                                              |  |                                                                                              |  |                                                                             |       |                                                                                                                                           |            |    
|------------------------------------------------------------- |  | -------------------------------------------------------------------------------------------- |  | --------------------------------------------------------------------------- | ----- | ----------------------------------------------------------------------------------------------------------------------------------------- | ---------- | ---
|Plan Category                                                 |  | Number of Securities to beIssued Upon Exercise ofOutstanding Options,Warrants, and
Rights(a) |  | Weighted-AverageExercise Price ofOutstanding Options,Warrants and
Rights(b) |       | Number of SecuritiesRemaining Available forFuture Issuance UnderEquity Compensation Plans(Excluding Securities Reflectedin Column (a))(c) |           
|Equity compensation plans approved by security holders        |  | 31,476,784                                                                                   |  | $                                                                           | 8.51  |                                                                                                                                           | 21,628,241 | (2)
|Equity compensation plans not approved by security holders(1) |  | 142,261                                                                                      |  | $                                                                           | 10.78 |                                                                                                                                           | 891,494    |    
|                                                              |  |                                                                                              |  |                                                                             |       |                                                                                                                                           |            |    
|Total                                                         |  | 31,619,045                                                                                   |  | $                                                                           | 8.52  |                                                                                                                                           | 22,519,735 |    
|                                                              |  |                                                                                              |  |                                                                             |       |                                                                                                                                           |            |    



|(1) | Represents options assumed in connection with our acquisitions.
|--- | ---------------------------------------------------------------

|(2) | This number includes 9,479,211 shares available for future issuance under the 2008 Employee Stock Purchase Plan and 996,422 shares available for future issuance under
the 2009 Deferred Compensation Plan.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



18



---

##### Table of Contents

Performance Graph

The following graph compares the five-year cumulative total return to stockholders on our common stock for the period ending November 30, 2009, with the cumulative total return of the NASDAQ
Composite Index and the S&P Information Technology Index. The graph assumes that $100.00 was invested on November 30, 2004 in each of our common stock, the NASDAQ Composite Index and the S&P Information Technology Index, and that all
dividends were reinvested. No cash dividends have been declared or paid on our common stock. The comparisons in the table are required by the SEC and are not intended to forecast or be indicative of possible future performance of our common stock.

LOGO



|                                 |  |                    |        |      |   |        |  |      |        |      |   |        |  |   |       |  |   |       
|-------------------------------- |  | ------------------ | ------ | ---- | - | ------ |  | ---- | ------ | ---- | - | ------ |  | - | ----- |  | - | ------
|                                 |  | As of November 30,
|                                 |  | 2004               |        | 2005 |   | 2006   |  | 2007 |        | 2008 |   | 2009  
|TIBCO Software Inc.              |  | $                  | 100.00 |      | $ | 72.78  |  | $    | 80.96  |      | $ | 68.09  |  | $ | 42.09 |  | $ | 74.78 
|NASDAQ Composite Index           |  | $                  | 100.00 |      | $ | 105.35 |  | $    | 117.80 |      | $ | 128.17 |  | $ | 73.25 |  | $ | 103.36
|S&P Information Technology Index |  | $                  | 100.00 |      | $ | 107.00 |  | $    | 114.13 |      | $ | 129.03 |  | $ | 73.19 |  | $ | 114.05



19



---

##### Table of Contents

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

In April 2008, our Board of Directors approved a stock repurchase program pursuant to which we may repurchase up to $300.0 million of our
outstanding common stock. The remaining authorized amount for stock repurchases under the April 2008 stock repurchase program was approximately $89.8 million as of the end of fiscal year 2009.

The following table provides information about the repurchase of our common stock during the three months ended November 30, 2009:



|                         |  |                                 |  |                             |      |                                                                              |           |                                                                                      |   |            
|------------------------ |  | ------------------------------- |  | --------------------------- | ---- | ---------------------------------------------------------------------------- | --------- | ------------------------------------------------------------------------------------ | - | -----------
|Period                   |  | Total Number ofShares Purchased |  | Average PricePaid per Share |      | Total Number ofShares Purchasedas Part of PubliclyAnnounced Plans orPrograms |           | Approximate DollarValue of Shares thatMay Yet Be PurchasedUnder the Plansor Programs
|August 31  September 30 |  | 718,250                         |  | $                           | 9.52 |                                                                              | 718,250   |                                                                                      | $ | 124,804,688
|October 1  October 31   |  | 3,608,700                       |  | $                           | 9.69 |                                                                              | 3,608,700 |                                                                                      | $ | 89,835,375 
|November 1  November 30 |  |                                |  |                             |     |                                                                              |          |                                                                                      | $ | 89,835,375 
|                         |  |                                 |  |                             |      |                                                                              |           |                                                                                      |   |            
|Total                    |  | 4,326,950                       |  | $                           | 9.66 |                                                                              | 4,326,950 |                                                                                      |   |            
|                         |  |                                 |  |                             |      |                                                                              |           |                                                                                      |   |            



20



---

##### Table of Contents

|ITEM 6. | SELECTED FINANCIAL DATA
|------- | -----------------------

The selected consolidated financial data below have been derived from our audited financial statements. The following table should be read in conjunction with Managements Discussion and Analysis of Financial Condition and
Results of Operation and our Consolidated Financial Statements and notes thereto included elsewhere in this Annual Report on Form 10-K. The historical results presented below are not indicative of any future results.

All amounts presented in the table below are stated in thousands, except for per share data.



|                                                     |  |                         |         |   |      |   |         |      |  |   |         |   |  |      |         |   |  |   |         |  
|---------------------------------------------------- |  | ----------------------- | ------- | - | ---- | - | ------- | ---- |  | - | ------- | - |  | ---- | ------- | - |  | - | ------- | -
|                                                     |  | Year Ended November 30, |        
|                                                     |  | 2009                    |         |   | 2008 |   |         | 2007 |  |   | 2006    |   |  | 2005 |        
|Selected Consolidated Statements of Operations Data: |  |                         |         |   |      |   |         |      |  |   |         |   |  |      |         |   |  |   |         |  
|Revenue:                                             |  |                         |         |   |      |   |         |      |  |   |         |   |  |      |         |   |  |   |         |  
|License                                              |  | $                       | 247,237 |   |      | $ | 273,415 |      |  | $ | 259,313 |   |  | $    | 240,071 |   |  | $ | 203,888 |  
|Service and maintenance                              |  |                         | 374,151 |   |      |   | 371,056 |      |  |   | 318,073 |   |  |      | 277,208 |   |  |   | 242,022 |  
|                                                     |  |                         |         |   |      |   |         |      |  |   |         |   |  |      |         |   |  |   |         |  
|Total revenue                                        |  |                         | 621,388 |   |      |   | 644,471 |      |  |   | 577,386 |   |  |      | 517,279 |   |  |   | 445,910 |  
|                                                     |  |                         |         |   |      |   |         |      |  |   |         |   |  |      |         |   |  |   |         |  
|Cost of revenue:                                     |  |                         |         |   |      |   |         |      |  |   |         |   |  |      |         |   |  |   |         |  
|License                                              |  |                         | 28,252  |   |      |   | 30,276  |      |  |   | 24,024  |   |  |      | 15,936  |   |  |   | 12,694  |  
|Service and maintenance                              |  |                         | 130,800 |   |      |   | 147,622 |      |  |   | 134,877 |   |  |      | 117,745 |   |  |   | 111,499 |  
|                                                     |  |                         |         |   |      |   |         |      |  |   |         |   |  |      |         |   |  |   |         |  
|Total cost of revenue                                |  |                         | 159,052 |   |      |   | 177,898 |      |  |   | 158,901 |   |  |      | 133,681 |   |  |   | 124,193 |  
|                                                     |  |                         |         |   |      |   |         |      |  |   |         |   |  |      |         |   |  |   |         |  
|Gross profit                                         |  |                         | 462,336 |   |      |   | 466,573 |      |  |   | 418,485 |   |  |      | 383,598 |   |  |   | 321,717 |  
|Operating expenses:                                  |  |                         |         |   |      |   |         |      |  |   |         |   |  |      |         |   |  |   |         |  
|Research and development                             |  |                         | 108,691 |   |      |   | 106,594 |      |  |   | 92,924  |   |  |      | 85,923  |   |  |   | 73,136  |  
|Sales and marketing                                  |  |                         | 204,212 |   |      |   | 224,641 |      |  |   | 197,397 |   |  |      | 172,768 |   |  |   | 140,370 |  
|General and administrative                           |  |                         | 46,666  |   |      |   | 53,046  |      |  |   | 51,538  |   |  |      | 44,139  |   |  |   | 37,320  |  
|Amortization of acquired intangible assets           |  |                         | 14,165  |   |      |   | 16,557  |      |  |   | 13,164  |   |  |      | 9,454   |   |  |   | 8,912   |  
|Restructuring charges (adjustment)                   |  |                         |        |   |      |   |        |      |  |   | (1,095  | ) |  |      | (1,042  | ) |  |   | 3,905   |  
|Acquired in-process research and development         |  |                         |        |   |      |   |        |      |  |   | 1,600   |   |  |      |        |   |  |   |        |  
|                                                     |  |                         |         |   |      |   |         |      |  |   |         |   |  |      |         |   |  |   |         |  
|Total operating expenses                             |  |                         | 373,734 |   |      |   | 400,838 |      |  |   | 355,528 |   |  |      | 311,242 |   |  |   | 263,643 |  
|                                                     |  |                         |         |   |      |   |         |      |  |   |         |   |  |      |         |   |  |   |         |  
|Income from operations                               |  |                         | 88,602  |   |      |   | 65,735  |      |  |   | 62,957  |   |  |      | 72,356  |   |  |   | 58,074  |  
|Interest and other income, net                       |  |                         | 3,983   |   |      |   | 8,333   |      |  |   | 17,266  |   |  |      | 21,373  |   |  |   | 11,718  |  
|Interest expense                                     |  |                         | (2,968  | ) |      |   | (3,238  | )    |  |   | (2,824  | ) |  |      | (3,171  | ) |  |   | (2,711  | )
|                                                     |  |                         |         |   |      |   |         |      |  |   |         |   |  |      |         |   |  |   |         |  
|Income before income taxes                           |  |                         | 89,617  |   |      |   | 70,830  |      |  |   | 77,399  |   |  |      | 90,558  |   |  |   | 67,081  |  
|Provision for (benefit from) income taxes            |  |                         | 27,097  |   |      |   | 18,314  |      |  |   | 25,401  |   |  |      | 17,694  |   |  |   | (5,474  | )
|Minority interest, net of tax                        |  |                         | 218     |   |      |   | 105     |      |  |   | 110     |   |  |      |        |   |  |   |        |  
|                                                     |  |                         |         |   |      |   |         |      |  |   |         |   |  |      |         |   |  |   |         |  
|Net income(1)                                        |  | $                       | 62,302  |   |      | $ | 52,411  |      |  | $ | 51,888  |   |  | $    | 72,864  |   |  | $ | 72,555  |  
|                                                     |  |                         |         |   |      |   |         |      |  |   |         |   |  |      |         |   |  |   |         |  
|Net income per share:                                |  |                         |         |   |      |   |         |      |  |   |         |   |  |      |         |   |  |   |         |  
|Basic(1)                                             |  | $                       | 0.37    |   |      | $ | 0.29    |      |  | $ | 0. 26   |   |  | $    | 0.35    |   |  | $ | 0.34    |  
|Diluted(1)                                           |  | $                       | 0.36    |   |      | $ | 0.29    |      |  | $ | 0. 25   |   |  | $    | 0.33    |   |  | $ | 0.32    |  
|Shares used in computing net income per share:       |  |                         |         |   |      |   |         |      |  |   |         |   |  |      |         |   |  |   |         |  
|Basic                                                |  |                         | 168,970 |   |      |   | 180,525 |      |  |   | 198,885 |   |  |      | 209,538 |   |  |   | 213,263 |  
|Diluted                                              |  |                         | 172,328 |   |      |   | 183,742 |      |  |   | 205,316 |   |  |      | 218,075 |   |  |   | 223,977 |  



|(1) | Net income and net income per share include the impact of share-based payments of $23.5 million, $21.0 million, $17.6 million and $15.8 million for fiscal years 2009,
2008, 2007 and 2006, respectively, which are not included in years prior to 2006.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



21



---

##### Table of Contents

|                                                  |  |                    |           |      |   |           |  |      |           |      |   |           |  |   |          
|------------------------------------------------- |  | ------------------ | --------- | ---- | - | --------- |  | ---- | --------- | ---- | - | --------- |  | - | ---------
|                                                  |  | As of November 30,
|                                                  |  | 2009               |           | 2008 |   | 2007      |  | 2006 |           | 2005
|Selected Consolidated Balance Sheet Data:         |  |                    |           |      |   |           |  |      |           |      |   |           |  |   |          
|Cash, cash equivalents and short-term investments |  | $                  | 292,836   |      | $ | 267,473   |  | $    | 265,771   |      | $ | 539,570   |  | $ | 477,638  
|Working capital                                   |  |                    | 218,055   |      |   | 195,822   |  |      | 238,894   |      |   | 529,000   |  |   | 458,685  
|Total assets                                      |  |                    | 1,166,339 |      |   | 1,088,568 |  |      | 1,198,459 |      |   | 1,226,359 |  |   | 1,122,424
|Total long-term debt                              |  |                    | 42,525    |      |   | 44,558    |  |      | 46,482    |      |   | 48,345    |  |   | 50,143   
|Total stockholders equity                        |  |                    | 796,749   |      |   | 741,643   |  |      | 855,396   |      |   | 946,007   |  |   | 873,619  



22



---

##### Table of Contents

|ITEM 7. | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|------- | -------------------------------------------------------------------------------------

The following contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the
Exchange Act. Forward-looking statements relate to expectations concerning future events or matters that are not historical facts. Words such as projects, believes, anticipates, plans,
expects, intends, strategy, continue, will, estimate, forecast and similar words and expressions are intended to identify forward-looking statements, although these
words are not the only means of identifying these statements. Although we believe that the expectations reflected in the forward-looking statements contained herein are reasonable, these expectations or any of the forward-looking statements could
prove to be incorrect, and actual results could differ materially from those projected or assumed in the forward-looking statements. Our future financial condition and results of operations, as well as any forward-looking statements, are subject to
risks and uncertainties, including, but not limited, to the factors set forth under Item 1A. Risk Factors. This discussion should be read in conjunction with our Consolidated Financial Statements and accompanying notes which appear
elsewhere in this Annual Report on Form 10-K. All forward-looking statements and reasons why results may differ included in this Annual Report on Form 10-K are made as of the date hereof, and we assume no obligation to update any such
forward-looking statements or reasons why actual results may differ.

Executive Overview

Our products are currently licensed by companies worldwide in diverse industries such as energy, financial services, government, insurance,
life sciences, logistics, manufacturing, retail, telecommunications, and transportation. We sell our products through a direct sales force and through alliances with leading software vendors and system integrators.

Our revenue consists primarily of license and maintenance fees from our customers and distributors. In addition, we receive fees from our
customers for providing consulting services. We also receive revenue from our strategic relationships with business partners who embed our products in their software, hardware and networking systems as well as from systems integrators who resell our
products.

Our revenue is generally derived from a diverse customer base. No single customer represented greater than 10% of
total revenue in fiscal years 2009, 2008 or 2007. As of November 30, 2009 and 2008, no single customer had a balance in excess of 10% of our net accounts receivable. We establish allowances for doubtful accounts based on our evaluation of
collectability and an allowance for returns and discounts based on specifically identified credits and historical experience.

For the fiscal year ended November 30, 2009, we recorded total revenue of $621.4 million, a decrease of 4% over fiscal 2008. License revenue was $247.2 million, 10% less than the previous year. In addition, we generated cash flow from
operations of $115.4 million, for a decrease of 24% year-over-year. Diluted earnings per share under generally accepted accounting principles in the United States of America (GAAP) was $0.36 in fiscal year 2009 as compared to $0.29 for
the fiscal year 2008 for an increase of 24%. We ended the year with $292.8 million in cash, cash equivalents and short-term investments, while also having repurchased approximately $106.4 million of our common stock during the year.

Critical Accounting Policies, Judgments and Estimates

The discussion and analysis of our financial condition and results of operations are based upon our Consolidated Financial Statements, which have been prepared in accordance with GAAP. The preparation of
these financial statements requires us to make estimates, assumptions and judgments that can have a significant impact on the reported amounts of assets and liabilities, revenues and expenses, and related disclosure of contingent assets and
liabilities at the date of our financial statements. We base our estimates, assumptions and judgments on historical experience and various other factors that we believe to be reasonable under the



23



---

##### Table of Contents

circumstances. Actual results may differ from these estimates under different assumptions or conditions. On a regular basis we evaluate our estimates, assumptions and judgments and make changes
accordingly. We also discuss our critical accounting estimates with the Audit Committee of our Board of Directors. We believe that the estimates, assumptions and judgments involved in revenue recognition, allowances for doubtful accounts, returns
and discounts, stock-based compensation, business combination, impairment of goodwill, intangible assets and long-lived assets, and accounting for income taxes have the greatest potential impact on our Consolidated Financial Statements, so we
consider these to be our critical accounting policies.

We discuss below the critical accounting estimates associated with
these policies. Historically, our estimates, assumptions and judgments relative to our critical accounting policies have not differed materially from actual results. For further information on our significant accounting policies, see Note 2 to our
Consolidated Financial Statements included in this Annual Report on Form 10-K.

Revenue
Recognition.    We recognize license revenue when a signed contract or other persuasive evidence of an arrangement exists, the software has been shipped or electronically delivered, the license fee is fixed or determinable,
and collection of the resulting receivable is probable. When contracts contain multiple elements wherein vendor specific objective evidence (VSOE) of fair value exists for all undelivered elements, we account for the delivered elements
in accordance with the Residual Method prescribed by the authoritative guidance. VSOE of fair value for maintenance and support is established by a stated renewal rate included in the license arrangement or rates charged in stand-alone sales of
maintenance and support. We recognize revenue on shipments to resellers when evidence of an end-user arrangement exists. We record revenue net of related costs to the resellers. Provided all other revenue criteria are met, the upfront, minimum,
non-refundable license fees from OEM customers are generally recognized upon delivery and on-going royalty fees are generally recognized upon reporting of units shipped.

We assess whether the fee is fixed or determinable, and collection is probable, at the time of the transaction. In determining whether the fee is fixed or determinable, we compare the payment terms of the
transaction to our standard payment terms. If a significant portion of the fee is considered to have extended payment terms, we account for the fee as not being fixed or determinable and recognize revenue as the payments become due. We assess
whether collection is probable based on a number of factors, including the customers past transaction history and credit-worthiness. We do not request collateral from our customers. If we determine that collection of a fee is not probable, we
defer the fee and recognize revenue at the time collection becomes probable, which is generally upon receipt of cash.

First-year maintenance typically is sold with the related software license and renewed on an annual basis thereafter. Maintenance revenue is deferred and recognized ratably over the term of the maintenance and support period. Consulting and
training revenues are typically recognized as the services are performed, usually on a time and materials basis. Such services primarily consist of implementation services related to the installation of our products and generally do not include
significant customization, or development of, the underlying software code, typically twelve months.

Many customers who
license our software also enter into separate professional services and training arrangements with us. In determining whether professional services revenue should be accounted for separately from license revenue, we evaluate (among other factors):
the nature of our software products; whether they are ready for use by the customer upon receipt; the nature of our implementation services (which typically do not involve significant customization to or development of the underlying software code);
the availability of services from other vendors; whether the timing of payments for license revenue is coincident with performance of services and whether milestones; acceptance criteria exist that affect the realizability of the software license
fee. Substantially all of our professional services arrangements are billed on a time and materials basis, and, accordingly, are recognized as the services are performed. Contracts with fixed or not-to-exceed fees are recognized on a
percentage-of-completion basis. If there is significant uncertainty about the project completion or receipt of payment for professional services, revenue is deferred until the uncertainty is sufficiently resolved.



24



---

##### Table of Contents

We recognize training revenue as training services are delivered. VSOE of fair value of services, for consulting or training, is based upon standalone sales of these services.

For license and professional service arrangements that do not qualify for separate accounting, such as arrangements that involve significant
modification or customization of the software, arrangements that include milestones or customer specific acceptance criteria, or where payment for the software license is tied to the performance of professional services, software license revenue is
generally recognized together with the professional services revenue using either the percentage-of-completion or completed-contract method. The completed contract method is used for contracts where there is a risk over final acceptance by the
customer or for contracts that are short term in nature. Under the percentage-of-completion method, revenue recognized is equal to the ratio of costs expended to date to the anticipated total contract costs, based on current estimates of costs to
complete the project. If there are milestones or acceptance provisions associated with the contract, the revenue recognized will not exceed the most recent milestone achieved or acceptance obtained. If the total estimated costs to complete a project
exceed the total contract amount, indicating a loss, the entire anticipated loss would be recognized currently.

Significant
management judgments and estimates must be made in connection with determination of the revenue to be recognized in any accounting period. If we made different judgments or utilized different estimates for any period, material differences in the
amount and timing of revenue recognized could result.

Allowances for Doubtful Accounts, Returns and
Discounts.    We establish allowances for doubtful accounts, returns and discounts based on our review of credit profiles of our customers, contractual terms and conditions, current economic trends and historical payment,
return and discount experience. We reassess the allowances for doubtful accounts, returns and discounts each period. Historically, our actual losses and credits have been consistent with these provisions. However, unexpected events or significant
future changes in trends could result in a material impact to our future statements of operations and of cash flows. If we made different judgments or utilized different estimates for any period, material differences in the amount and timing of
revenue or bad debt expense recognized could result. Our allowances for doubtful accounts, returns and discounts as a percentage of net revenues were approximately 1% in fiscal years 2009, 2008 and 2007. See Note 6 to our Consolidated Financial
Statements included in this Annual Report on Form 10-K for a summary of activities during the years reported.

Stock-Based
Compensation.    We recognize the costs of employee services received in share-based payment transactions according to the fair value provisions of the current share-based payment guidance. The fair value of employee services
received in stock-based payment transactions is estimated at the grant date and recognized over the requisite service period. Determining the appropriate fair value model and calculating the fair value of stock-based awards requires judgment,
including estimating stock price volatility, forfeiture rates and expected life.

We selected the Black-Scholes option pricing
model as the most appropriate method for determining the estimated fair value of our share-based awards. The Black-Scholes model requires the use of highly subjective and complex assumptions which determine the fair value of share-based awards,
including the options expected term and the price volatility of the underlying stock. Our current estimate of volatility is based on historical and market-based implied volatilities of our stock price. To the extent volatility of our stock
price increases in the future, our estimates of the fair value of options granted in the future could increase, thereby increasing stock-based compensation cost recognized in future periods. We derive the expected term assumption primarily based on
our historical settlement experience, while giving consideration to options that have not yet completed a full life cycle. Stock-based compensation cost is recognized only for awards ultimately expected to vest. Our estimate of the forfeiture rate
is based primarily on our historical experience. To the extent we revise this estimate in the future, our share-based compensation cost could be materially impacted in the quarter of revision, as well as in the following quarters. In the future, as
empirical evidence regarding these input estimates is available to provide more directionally predictive results, we may change or refine our approach of deriving these input estimates.



25



---

##### Table of Contents

These changes could impact the fair value of stock options granted in the future and associated share-based compensation cost recognized in our financial statements. Refer to Note 2 and Note 15
to our Consolidated Financial Statements included in this Annual Report on Form 10-K for further details.

Business
Combination.    In accordance with authoritative guidance, we allocate the purchase price of acquired companies to the tangible and intangible assets acquired, liabilities assumed and as well as to in-process research and
development based upon their estimated fair values at the acquisition date. The purchase price allocation process requires our management to make significant estimates and assumptions, especially at the acquisition date with respect to intangible
assets, support obligations assumed, estimated restructuring liabilities and pre-acquisition contingencies.

Although we
believe the assumptions and estimates we have made in the past have been reasonable and appropriate, they are based in part on historical experience and information obtained from the management of the acquired companies and are inherently uncertain.
The purchase price allocation process requires us to use significant estimates and assumptions, including fair value estimates, as of the business combination date including:



| |  |  | estimated fair values of intangible assets acquired from the acquiree;
| | - |  | ----------------------------------------------------------------------



| |  |  | estimated fair values of software license updates and product support obligations assumed from the acquiree;
| | - |  | ------------------------------------------------------------------------------------------------------------



| |  |  | estimated income tax assets and liabilities assumed from the acquiree;
| | - |  | ----------------------------------------------------------------------



| |  |  | estimated value of restructuring liabilities to reorganize the acquirees pre-acquisition operations in;
| | - |  | --------------------------------------------------------------------------------------------------------



| |  |  | estimated fair values of stock awards assumed from the acquiree that are included in the purchase price; and
| | - |  | ------------------------------------------------------------------------------------------------------------



| |  |  | estimated fair value of pre-acquisition contingencies assumed from the acquiree.
| | - |  | --------------------------------------------------------------------------------

Impairment of Goodwill, Intangible Assets and Long-Lived Assets.Our goodwill and intangible assets result
from our corporate acquisition transactions. Goodwill and intangible assets with indefinite useful lives are not amortized, but are instead tested for impairment at least annually or as circumstances indicate their value may no longer be
recoverable. We do not carry any intangible assets with indefinite useful lives other than goodwill. We generally perform our annual impairment test at the end of the fiscal year. As we operate our business in one reporting unit, our goodwill is
tested for impairment at the enterprise level. Goodwill impairment testing is a two-step process. For the first step, we screen for impairment, and if any possible impairment exists, we undertake a second step of measuring such impairment by
performing the discounted cash flow analyses. These analyses are based on cash flow assumptions that are consistent with the plans and estimates being used to manage our business. In the first step, we review the carrying amount of our reporting
unit at enterprise level compared to the fair value of the enterprise based on quoted market prices of our common stock. An excess carrying value to fair value would indicate that goodwill may be impaired. If we determined that goodwill
may be impaired, then we would compare the implied fair value of the goodwill. We periodically re-evaluate our business and have determined that we continue to operate in one segment, which we consider our sole reporting unit. If our
assumptions change in the future, we may be required to record impairment charges to reduce the carrying value of our goodwill. Changes in the valuation of goodwill could materially impact our operating results and financial position.

We evaluate the recoverability of our long-lived assets including amortizable intangible and tangible assets in accordance with
authoritative guidance. When events or changes in circumstances indicate that the carrying amount of long-lived assets may not be recoverable, we recognize such impairment in the event the net book value of such assets exceeds the future
undiscounted cash flows attributable to such assets. Our acquired intangible assets with definite useful lives are amortized on a straight line basis over their useful lives, and periodically tested for impairment. We have not recorded any
impairment losses to date. As of November 30,



26



---

##### Table of Contents

2009, we had $374.3 million of goodwill, $94.6 million of property and equipment and $83.1 million of acquired intangible assets. If our estimates or the related assumptions change in the future,
we may be required to record impairment charges to reduce the carrying value of these assets. Changes in the valuation of long-lived assets could materially impact our operating results and financial position.

To date, there have been no impairments of goodwill, intangibles and long-lived assets.

Accounting for Income Taxes.    We make certain estimates and judgments in determining income tax expense for
financial statement purposes. These estimates and judgments occur in the calculation of certain tax assets and liabilities, which arise from differences in the timing of recognition of revenue and expense for tax and financial statement purposes.

As part of the process of preparing our Consolidated Financial Statements, we are required to estimate our income taxes in
each of the jurisdictions in which we operate. This process involves us estimating our current tax exposure under the most recent tax laws and assessing temporary differences resulting from differing treatment of items for tax and accounting
purposes. These differences result in deferred tax assets and liabilities, which are included in our Consolidated Balance Sheets.

We assess the likelihood that we will be able to recover our deferred tax assets. We consider all available evidence, both positive and negative, including historical levels of income, expectations and risks associated with estimates of
future taxable income and ongoing prudent and feasible tax planning strategies in assessing the need for a valuation allowance. If it is not more likely than not that we will recover our deferred tax assets, we will increase our provision for taxes
by recording a valuation allowance against the deferred tax assets that we estimate will not ultimately be recoverable. The available positive evidence at November 30, 2009 included historical operating profits and a projection of future income
sufficient to realize most of our remaining deferred tax assets. We recorded a valuation allowance of $0.7 million in fiscal year 2009 related to excess foreign tax credit. As of November 30, 2009, it was considered more likely than not
that our deferred tax assets would be realized with the exception of certain capital loss and foreign tax credit carryovers as we cannot forecast sufficient future capital gains or foreign source income to realize these deferred tax assets. The
remaining valuation allowance of approximately $8.7 million as of November 30, 2009 will result in an income tax benefit if and when we conclude it is more likely than not that the related deferred tax assets will be realized.

As of November 30, 2009, we believed that the amount of deferred tax assets recorded on our balance sheet would ultimately be
recovered. However, should there be a change in our ability to recover our deferred tax assets, our tax provision would increase in the period in which we determine that it is more likely than not that we cannot recover our deferred tax assets. If
we have to re-establish a full valuation allowance against our deferred tax assets, it would result in an increase of $38.0 million to income tax expense.

U.S. income taxes and foreign withholding taxes have not been provided on a cumulative total of $42.5 million of undistributed earnings for certain non-U.S. subsidiaries. With the exception of our
subsidiaries in the United Kingdom and Japan, net undistributed earnings of our foreign subsidiaries are considered to be indefinitely reinvested, and accordingly, no provision for U.S. income taxes has been provided thereon. We have sufficient cash
reserves in the U.S. and do not require repatriation of our foreign earnings. We intend to use the undistributed earnings for acquisitions, local operations expansion and to meet local operating expense requirements. Upon distribution of these
earnings in the form of dividends or otherwise, we will be subject to U.S. income taxes net of available foreign tax credits associated with these earnings. Determination of the amount of unrecognized deferred tax liability related to these earnings
is not practicable.

See Note 19 to our Consolidated Financial Statements included in this Annual Report on Form 10-K.



27



---

##### Table of Contents

Results of Operations

The following table presents certain Consolidated Statements of Operations data as percentages of total revenue for the periods indicated:



|                                             |  |                         |   |  |      |   |  |      |  
|-------------------------------------------- |  | ----------------------- | - |  | ---- | - |  | ---- | -
|                                             |  | Year Ended November 30, |  
|                                             |  | 2009                    |   |  | 2008 |   |  | 2007 |  
|Revenue:                                     |  |                         |   |  |      |   |  |      |  
|License                                      |  | 40                      | % |  | 42   | % |  | 45   | %
|Service and maintenance                      |  | 60                      |   |  | 58   |   |  | 55   |  
|                                             |  |                         |   |  |      |   |  |      |  
|Total revenue                                |  | 100                     |   |  | 100  |   |  | 100  |  
|                                             |  |                         |   |  |      |   |  |      |  
|Cost of revenue:                             |  |                         |   |  |      |   |  |      |  
|License                                      |  | 5                       |   |  | 5    |   |  | 4    |  
|Service and maintenance                      |  | 21                      |   |  | 23   |   |  | 24   |  
|                                             |  |                         |   |  |      |   |  |      |  
|Total cost of revenue                        |  | 26                      |   |  | 28   |   |  | 28   |  
|                                             |  |                         |   |  |      |   |  |      |  
|Gross profit                                 |  | 74                      |   |  | 72   |   |  | 72   |  
|                                             |  |                         |   |  |      |   |  |      |  
|Operating expenses:                          |  |                         |   |  |      |   |  |      |  
|Research and development                     |  | 17                      |   |  | 17   |   |  | 16   |  
|Sales and marketing                          |  | 33                      |   |  | 35   |   |  | 34   |  
|General and administrative                   |  | 8                       |   |  | 8    |   |  | 9    |  
|Amortization of acquired intangible assets   |  | 2                       |   |  | 2    |   |  | 2    |  
|Restructuring adjustment                     |  |                        |   |  |     |   |  |     |  
|Acquired in-process research and development |  |                        |   |  |     |   |  |     |  
|                                             |  |                         |   |  |      |   |  |      |  
|Total operating expenses                     |  | 60                      |   |  | 62   |   |  | 61   |  
|                                             |  |                         |   |  |      |   |  |      |  
|Income from operations                       |  | 14                      |   |  | 10   |   |  | 11   |  
|Interest income                              |  |                        |   |  | 1    |   |  | 3    |  
|Interest expense                             |  |                        |   |  |     |   |  | (1   | )
|Other income (expense), net                  |  |                        |   |  |     |   |  |     |  
|                                             |  |                         |   |  |      |   |  |      |  
|Income before provision for income taxes     |  | 14                      |   |  | 11   |   |  | 13   |  
|Provision for income taxes                   |  | 4                       |   |  | 3    |   |  | 4    |  
|                                             |  |                         |   |  |      |   |  |      |  
|Net income                                   |  | 10                      | % |  | 8    | % |  | 9    | %
|                                             |  |                         |   |  |      |   |  |      |  

In August 2009, we acquired DataSynapse, Inc. (DataSynapse), a provider
of enterprise grid and cloud computing software. In September 2008, we acquired Insightful Corporation (Insightful), a provider of statistical data analysis and data mining solutions software. In June 2007, we acquired Spotfire Holdings,
Inc. (Spotfire), a leading provider of next-generation business intelligence software. DataSynapse is included in our SOA product group and Insightful and Spotfire are now included in our business optimization product group. Our
Consolidated Results of Operations have included incremental revenue and costs related to the DataSynapse, Insightful and Spotfire operations since the date of acquisition. In connection with these acquisitions, we have incurred additional expenses,
including amortization of intangible assets and acquired technology; stock-based compensation; personnel and related costs; facility and infrastructure costs; and other charges.

All amounts presented in the tables in the Results of Operations are stated in thousands of dollars, except percentages and unless otherwise
stated.



28



---

##### Table of Contents

Total Revenue

Our total revenue consisted primarily of license, service and maintenance fees from our customers and partners.



|              |  |                         |         |                   |   |         |  |             |         |  |             |    |  |    |  
|------------- |  | ----------------------- | ------- | ----------------- | - | ------- |  | ----------- | ------- |  | ----------- | -- |  | -- | -
|              |  | Year Ended November 30, |         | Percentage Change |  
|              |  | 2009                    |         | 2008              |   | 2007    |  | 2008to 2009 |         |  | 2007to 2008 |   
|Total revenue |  | $                       | 621,388 |                   | $ | 644,471 |  | $           | 577,386 |  | (4          | )% |  | 12 | %

Total revenue in fiscal year 2009 compared to fiscal year 2008 decreased by $23.1
million or 4%. The decrease was primarily due to a $26.2 million or 10% decrease in license revenue, which was partially offset by a $3.1 million or 1% increase in service and maintenance revenue. Our total revenue decreased by $14.4 million or 23%
in the APJ, $5.5 million or 2% in Americas and $3.2 million or 1% in EMEA in fiscal year 2009. See Note 22 to our Consolidated Financial Statements included in this Annual Report on Form 10-K for further details on total revenue by region.

We had no single customer that accounted for more than 10% of total revenue in fiscal years 2009, 2008 or 2007. Our products
are licensed by companies worldwide in diverse industries, and a high percentage of our revenue is from the financial services, telecommunications, life sciences, government, and energy sectors.

Total revenue in fiscal year 2008 compared to fiscal year 2007 increased by $67.1 million or 12%. The increase was primarily due to a $14.1
million or 5% increase in license revenue and a $53.0 million or 17% increase in service and maintenance revenue. Geographically, we experienced double-digit growth in total revenue from the Americas and EMEA in fiscal year 2008. Our total revenue
increased by $42.3 million or 15% in the Americas and $26.7 million or 11% in EMEA, which were partially offset by a $1.9 million or 3% decrease in APJ in fiscal year 2008.

License Revenue and Costs



|                              |  |                         |         |   |                   |   |         |      |  |   |             |   |  |             |    |  |    |  
|----------------------------- |  | ----------------------- | ------- | - | ----------------- | - | ------- | ---- |  | - | ----------- | - |  | ----------- | -- |  | -- | -
|                              |  | Year Ended November 30, |         |   | Percentage Change |  
|                              |  | 2009                    |         |   | 2008              |   |         | 2007 |  |   | 2008to 2009 |   |  | 2007to 2008 |   
|License revenue               |  | $                       | 247,237 |   |                   | $ | 273,415 |      |  | $ | 259,313     |   |  | (10         | )% |  | 5  | %
|Percentage of total revenue   |  |                         | 40      | % |                   |   | 42      | %    |  |   | 45          | % |  |             |    |  |    |  
|Cost of license revenue       |  | $                       | 28,252  |   |                   | $ | 30,276  |      |  | $ | 24,024      |   |  | (7          | )% |  | 26 | %
|Percentage of total revenue   |  |                         | 5       | % |                   |   | 5       | %    |  |   | 4           | % |  |             |    |  |    |  
|Percentage of license revenue |  |                         | 11      | % |                   |   | 11      | %    |  |   | 9           | % |  |             |    |  |    |  

We license a wide range of products to customers in various industries and geographic
regions. License revenue decreased by $26.2 million or 10% in fiscal year 2009 compared to fiscal year 2008. The reduction was primarily due to a decrease in revenue from life sciences, insurance and manufacturing sectors. The decrease was partially
offset by an increase in revenue from the government, telecommunications and energy sectors. License revenue increased by $14.1 million or 5% in fiscal year 2008 compared to fiscal year 2007, primarily due to an increase in revenue from life
sciences, government and manufacturing sectors. The increase was partially offset by a decrease in revenue from the financial services sector.



29



---

##### Table of Contents

Our license revenue in fiscal years 2009, 2008 and 2007 was derived from the following three
product solutions: SOA, business optimization and BPM.



|                      |  |                         |   |  |      |   |  |      |  
|--------------------- |  | ----------------------- | - |  | ---- | - |  | ---- | -
|                      |  | Year Ended November 30, |  
|                      |  | 2009                    |   |  | 2008 |   |  | 2007 |  
|SOA                   |  | 62                      | % |  | 56   | % |  | 65   | %
|Business optimization |  | 25                      |   |  | 32   |   |  | 19   |  
|BPM                   |  | 13                      |   |  | 12   |   |  | 16   |  
|                      |  |                         |   |  |      |   |  |      |  
|Total license revenue |  | 100                     | % |  | 100  | % |  | 100  | %
|                      |  |                         |   |  |      |   |  |      |  

Our license revenue in a particular period is dependent upon the timing and number of license deals and
their relative size. Selected data about our license revenue deals recognized for the respective periods is summarized as follows:



|                                                                    |  |                         |     |      |   |      |  |   |    
|------------------------------------------------------------------- |  | ----------------------- | --- | ---- | - | ---- |  | - | ---
|                                                                    |  | Year Ended November 30,
|                                                                    |  | 2009                    |     | 2008 |   | 2007
|Number of license deals of $1.0 million or more                     |  |                         | 58  |      |   | 55   |  |   | 54 
|Number of license deals of $0.1 million or more                     |  |                         | 366 |      |   | 414  |  |   | 376
|Average size of license deals of $0.1 million or more (in millions) |  | $                       | 0.6 |      | $ | 0.6  |  | $ | 0.6

Cost of license revenue
mainly consisted of royalty costs and amortization of developed technologies acquired through corporate acquisitions. Cost of license revenue decreased by $2.0 million or 7% in fiscal year 2009 compared to fiscal year 2008, and increased by $6.3
million or 26% in fiscal year 2008 compared to fiscal year 2007. The decrease in fiscal year 2009 was primarily due to a $2.3 million decrease in amortization of acquired technologies, mainly associated with the Staffware acquired technologies which
were fully amortized in the second quarter of fiscal year 2009. The decrease was partially offset by a $0.3 million increase in royalty costs. The increase in fiscal year 2008 was primarily due to a $5.4 million increase in amortization of acquired
technologies, mainly associated with the Spotfire acquisition, and a $1.0 million increase in royalty costs for third party software embedded in our products.

Service and Maintenance Revenue and Costs



|                                              |  |                         |         |   |                   |   |         |      |  |   |             |   |  |             |    |  |    |  
|--------------------------------------------- |  | ----------------------- | ------- | - | ----------------- | - | ------- | ---- |  | - | ----------- | - |  | ----------- | -- |  | -- | -
|                                              |  | Year Ended November 30, |         |   | Percentage Change |  
|                                              |  | 2009                    |         |   | 2008              |   |         | 2007 |  |   | 2008to 2009 |   |  | 2007to 2008 |   
|Service and maintenance revenue               |  | $                       | 374,151 |   |                   | $ | 371,056 |      |  | $ | 318,073     |   |  | 1           | %  |  | 17 | %
|Percentage of total revenue                   |  |                         | 60      | % |                   |   | 58      | %    |  |   | 55          | % |  |             |    |  |    |  
|Cost of service and maintenance revenue       |  | $                       | 130,800 |   |                   | $ | 147,622 |      |  | $ | 134,877     |   |  | (11         | )% |  | 9  | %
|Percentage of total revenue                   |  |                         | 21      | % |                   |   | 23      | %    |  |   | 24          | % |  |             |    |  |    |  
|Percentage of service and maintenance revenue |  |                         | 35      | % |                   |   | 40      | %    |  |   | 42          | % |  |             |    |  |    |  

Service and maintenance revenue increased by $3.1 million or 1% in fiscal year 2009 compared to
fiscal year 2008. The increase in fiscal year 2009 was the result of a $17.3 million increase in maintenance revenue, which was partially offset by a $14.2 million decrease in consulting and training services revenue. Service and maintenance revenue
increased by $53.0 million or 17% in fiscal year 2008 compared to fiscal year 2007. The increase in fiscal year 2008 was the result of a $14.5 million increase in consulting and training services revenue and a $38.5 million increase in maintenance
revenue. In fiscal year 2008, consulting revenue increased due to an increase in both the number and size of engagements, reflecting our increased focus on providing more services to customers. Maintenance revenue increased primarily due to
continued growth in our installed software base in fiscal years 2009 and 2008 and to the Spotfire acquisition in fiscal year 2007.

Cost of service and maintenance revenue consisted primarily of compensation and other related expenses for consultants, customer support personnel and third-party contractors associated with providing consulting services



30



---

##### Table of Contents

and stock-based compensation expense. The cost of service and maintenance revenue decreased as a percentage of total revenue in fiscal year 2009 compared to fiscal year 2008 and in fiscal year
2008 compared to fiscal year 2007, as a result of efforts to increase utilization of our consulting staff as well as an increase in the relative proportion of maintenance revenue. The $16.8 million or 11% decrease in fiscal year 2009 compared to
fiscal year 2008 resulted primarily from a decrease of $7.7 million in employee-related expenses, a decrease of $3.6 million in subcontractors costs, a decrease of $3.0 million in travel expenses and a decrease of $2.1 million in facilities
expenses. The decreases in employee-related expenses and travel expenses were primarily due to a reduction in salaries and travel. Decreased subcontractors costs were also directly related to decreased service revenue in fiscal year 2009. The $12.7
million or 9% increase in fiscal year 2008 compared to fiscal year 2007 resulted primarily from an increase of $8.7 million in employee-related expenses, an increase of $2.2 million in subcontractors costs, an increase of $1.2 million in travel
expenses and an increase of $0.7 million in facilities expenses. This increase was partially offset by a $0.3 million decrease in information technology-related expenses. Increased employee-related expenses were primarily due to an increase in
professional services and customer support staff. Increased subcontractors costs were also directly related to increased service revenue in fiscal year 2008.

Research and Development Expenses

Research and development expenses
consisted primarily of employee-related expenses, including salary, bonus, benefits, stock-based compensation expenses, recruiting expense and office support, third-party contractor fees and related costs associated with the development and
enhancement of our products.



|                                  |  |                         |         |   |                   |   |         |      |  |   |             |   |  |             |   |  |    |  
|--------------------------------- |  | ----------------------- | ------- | - | ----------------- | - | ------- | ---- |  | - | ----------- | - |  | ----------- | - |  | -- | -
|                                  |  | Year Ended November 30, |         |   | Percentage Change |  
|                                  |  | 2009                    |         |   | 2008              |   |         | 2007 |  |   | 2008to 2009 |   |  | 2007to 2008 |  
|Research and development expenses |  | $                       | 108,691 |   |                   | $ | 106,594 |      |  | $ | 92,924      |   |  | 2           | % |  | 15 | %
|Percentage of total revenue       |  |                         | 17      | % |                   |   | 17      | %    |  |   | 16          | % |  |             |   |  |    |  

Total research and development expenses increased by $2.1 million or 2% in fiscal
year 2009 compared to fiscal year 2008 and was primarily due to a $4.3 million increase in employee-related expenses, which was partially offset by a $1.2 million decrease in facilities expenses, a $0.7 million decrease in travel expenses and a $0.5
million decrease in contractor expenses. The increase in employee-related expenses was primarily due to an increase in variable compensation.

Total research and development expenses increased by $13.7 million or 15% in fiscal year 2008 compared to fiscal year 2007 and was primarily due to a $10.2 million increase in employee-related expenses
primarily attributable to the Spotfire acquisition, a $2.4 million increase in contractor expenses and a $0.5 million increase in facilities expenses.

Sales and Marketing Expenses

Sales and marketing expenses consisted
primarily of employee-related expenses, including sales commissions, salary, bonus, benefits, stock-based compensation expenses, recruiting expense and office support, related costs of our direct sales force and marketing staff, and the cost of
marketing programs, including customer conferences, promotional materials, trade shows, advertising and related travel expenses.



|                             |  |                         |         |   |                   |   |         |      |  |   |             |   |  |             |    |  |    |  
|---------------------------- |  | ----------------------- | ------- | - | ----------------- | - | ------- | ---- |  | - | ----------- | - |  | ----------- | -- |  | -- | -
|                             |  | Year Ended November 30, |         |   | Percentage Change |  
|                             |  | 2009                    |         |   | 2008              |   |         | 2007 |  |   | 2008to 2009 |   |  | 2007to 2008 |   
|Sales and marketing expenses |  | $                       | 204,212 |   |                   | $ | 224,641 |      |  | $ | 197,397     |   |  | (9          | )% |  | 14 | %
|Percentage of total revenue  |  |                         | 33      | % |                   |   | 35      | %    |  |   | 34          | % |  |             |    |  |    |  



31



---

##### Table of Contents

Total sales and marketing expenses decreased by $20.4 million or 9% in fiscal year 2009
compared to fiscal year 2008 and was primarily due to a $15.2 million decrease in employee-related expenses, a $4.9 million decrease in travel expenses and a $2.9 million decrease in marketing programs, which were partially offset by a $2.1 million
increase in referral fees. The decrease in employee-related expenses was primarily due to a reduction in salaries, benefits and commissions.

Total sales and marketing expenses increased by $27.2 million or 14% in fiscal year 2008 compared to fiscal year 2007 and was primarily due to a $21.5 million increase in employee-related expenses, a $2.8
million increase in marketing programs, a $1.6 million increase in referral fees and a $0.7 million increase in travel expenses. The increase in employee-related expenses was due to an increase in headcount mainly attributable to the Spotfire
acquisition and an increase in quota carrying sales representatives. The increases in travel expenses and marketing programs were due to increased sales and marketing activities and travel costs related to sales and marketing.

General and Administrative Expenses

General and administrative expenses consisted primarily of employee-related expenses, including salary, bonus, benefits, stock-based compensation expenses, recruiting expense and office support and
related costs for general corporate functions including executive, legal, finance, accounting and human resources, and also included accounting, tax and legal fees and charges.



|                                    |  |                         |        |   |                   |   |        |      |  |   |             |   |  |             |    |  |   |  
|----------------------------------- |  | ----------------------- | ------ | - | ----------------- | - | ------ | ---- |  | - | ----------- | - |  | ----------- | -- |  | - | -
|                                    |  | Year Ended November 30, |        |   | Percentage Change |  
|                                    |  | 2009                    |        |   | 2008              |   |        | 2007 |  |   | 2008to 2009 |   |  | 2007to 2008 |   
|General and administrative expenses |  | $                       | 46,666 |   |                   | $ | 53,046 |      |  | $ | 51,538      |   |  | (12         | )% |  | 3 | %
|Percentage of total revenue         |  |                         | 8      | % |                   |   | 8      | %    |  |   | 9           | % |  |             |    |  |   |  

Total general and administrative expenses decreased by $6.4 million or 12% in fiscal
year 2009 compared to fiscal year 2008 and was primarily due to a $3.4 million decrease in consulting expenses, a $1.8 million decrease in fees and charges and a $1.7 million decrease in employee-related expenses. The decrease in consulting expenses
was primarily due to reduction in the use of consultants and lower billing rates for the consultants.

The $1.5 million or 3%
increase in general and administrative expenses in fiscal year 2008 compared to fiscal year 2007 was primarily due to a $3.5 million increase in employee-related expenses and a $1.0 million increase in fees and charges, which were partially offset
by a $3.1 million decrease in consulting expenses. The increase in employee-related expenses was due to increased headcount and annual salary adjustments. Our fiscal year 2008 general and administrative expenses included incremental costs
attributable to the Spotfire acquisition.

Amortization of Acquired Intangible Assets

Intangible assets acquired through corporate acquisitions are comprised of the estimated value of developed technologies, patents,
trademarks, established customer bases and non-compete agreements, as well as maintenance and OEM customer royalty agreements. Amortization of developed technologies is recorded as a cost of revenue, and amortization of other acquired intangibles is
included in operating expenses.



|                                            |  |                         |        |   |                   |   |        |      |  |   |             |   |  |             |    |  |    |  
|------------------------------------------- |  | ----------------------- | ------ | - | ----------------- | - | ------ | ---- |  | - | ----------- | - |  | ----------- | -- |  | -- | -
|                                            |  | Year Ended November 30, |        |   | Percentage Change |  
|                                            |  | 2009                    |        |   | 2008              |   |        | 2007 |  |   | 2008to 2009 |   |  | 2007to 2008 |   
|Amortization of acquired intangible assets: |  |                         |        |   |                   |   |        |      |  |   |             |   |  |             |    |  |    |  
|In cost of revenue                          |  | $                       | 13,463 |   |                   | $ | 15,745 |      |  | $ | 10,326      |   |  |             |    |  |    |  
|In operating expenses                       |  |                         | 14,165 |   |                   |   | 16,557 |      |  |   | 13,164      |   |  |             |    |  |    |  
|                                            |  |                         |        |   |                   |   |        |      |  |   |             |   |  |             |    |  |    |  
|Total amortization expenses                 |  | $                       | 27,628 |   |                   | $ | 32,302 |      |  | $ | 23,490      |   |  | (14         | )% |  | 38 | %
|                                            |  |                         |        |   |                   |   |        |      |  |   |             |   |  |             |    |  |    |  
|Percentage of total revenue                 |  |                         | 4      | % |                   |   | 5      | %    |  |   | 4           | % |  |             |    |  |    |  



32



---

##### Table of Contents

Amortization expenses decreased by $4.7 million or 14% in fiscal year 2009 compared to
fiscal year 2008. The decreases in amortization expenses in fiscal year 2009 were primarily due to the Staffware acquired technologies which were fully amortized in the second quarter of fiscal year 2009. The decreases were partially offset by the
additional amortization related to intangible assets acquired in the acquisition of DataSynapse in the third quarter of fiscal year 2009. Amortization expenses increased by $8.8 million or 38% in fiscal year 2008 compared to fiscal year 2007. The
increases in amortization expenses in fiscal year 2008 were primarily due to the additional amortization related to intangible assets acquired in the acquisition of Insightful in the fourth quarter of fiscal year 2008 and Spotfire in the third
quarter of fiscal year 2007. See Note 8 to our Consolidated Financial Statements included in this Annual Report on Form 10-K for further details on acquired intangible assets.

Restructuring Adjustment



|                            |  |                         |   |   |                   |   |   |      |  |   |             |   |             |     |  |    
|--------------------------- |  | ----------------------- | - | - | ----------------- | - | - | ---- |  | - | ----------- | - | ----------- | --- |  | ---
|                            |  | Year Ended November 30, |   |   | Percentage Change
|                            |  | 2009                    |   |   | 2008              |   |   | 2007 |  |   | 2008to 2009 |   | 2007to 2008
|Restructuring adjustment    |  | $                       |  |   |                   | $ |  |      |  | $ | (1,095      | ) |             | n/a |  | n/a
|Percentage of total revenue |  |                         |  | % |                   |   |  | %    |  |   |            | % |             |     |  |    

In the third quarter of fiscal year 2007, we recorded a $1.1 million credit
adjustment to the restructuring charge related to properties vacated in connection with the consolidation of our facilities in fiscal year 2002. The adjustment resulted from revised estimates of future sublease income due to the recovery of the
applicable real estate market and the additions of new tenants. Currently, the majority of our previously vacated facilities under prior restructuring programs are now occupied by tenants.

Also see Note 9 to our Consolidated Financial Statements included in this Annual Report on Form 10-K for further discussion on restructuring
charges.

Acquired In-Process Research and Development



|                                             |  |                         |   |   |                   |   |   |      |  |   |             |   |             |     |  |    
|-------------------------------------------- |  | ----------------------- | - | - | ----------------- | - | - | ---- |  | - | ----------- | - | ----------- | --- |  | ---
|                                             |  | Year Ended November 30, |   |   | Percentage Change
|                                             |  | 2009                    |   |   | 2008              |   |   | 2007 |  |   | 2008to 2009 |   | 2007to 2008
|Acquired in-process research and development |  | $                       |  |   |                   | $ |  |      |  | $ | 1,600       |   |             | n/a |  | n/a
|Percentage of total revenue                  |  |                         |  | % |                   |   |  | %    |  |   |            | % |             |     |  |    

In the third quarter of fiscal year 2007, in conjunction with our acquisition of
Spotfire, we recorded acquired in-process research and development (IPR&D) charges of $1.6 million. Our methodology for allocating the purchase price relating to acquired IPR&D was determined through established valuation
techniques. Acquired IPR&D was expensed upon acquisition as technological feasibility had not been established and no future alternate use existed.



33



---

##### Table of Contents

Stock-Based Compensation

The stock-based compensation expenses included in our Consolidated Statements of Operations corresponding to the same functional lines as
cash compensation paid to the same employees in the respective departments are as follows:



|                                   |  |                         |        |   |                   |   |        |      |  |   |             |   |  |             |    |  |    |  
|---------------------------------- |  | ----------------------- | ------ | - | ----------------- | - | ------ | ---- |  | - | ----------- | - |  | ----------- | -- |  | -- | -
|                                   |  | Year Ended November 30, |        |   | Percentage Change |  
|                                   |  | 2009                    |        |   | 2008              |   |        | 2007 |  |   | 2008to 2009 |   |  | 2007to 2008 |   
|Stock-based compensation expenses: |  |                         |        |   |                   |   |        |      |  |   |             |   |  |             |    |  |    |  
|Cost of license                    |  | $                       | 39     |   |                   | $ | 33     |      |  | $ | 31          |   |  |             |    |  |    |  
|Cost of service and maintenance    |  |                         | 2,487  |   |                   |   | 2,579  |      |  |   | 2,434       |   |  |             |    |  |    |  
|                                   |  |                         |        |   |                   |   |        |      |  |   |             |   |  |             |    |  |    |  
|Total in cost of revenue           |  |                         | 2,526  |   |                   |   | 2,612  |      |  |   | 2,465       |   |  | (3          | )% |  | 6  | %
|Research and development           |  |                         | 5,597  |   |                   |   | 4,584  |      |  |   | 3,712       |   |  |             |    |  |    |  
|Sales and marketing                |  |                         | 7,440  |   |                   |   | 6,963  |      |  |   | 5,695       |   |  |             |    |  |    |  
|General and administrative         |  |                         | 7,983  |   |                   |   | 6,813  |      |  |   | 5,691       |   |  |             |    |  |    |  
|                                   |  |                         |        |   |                   |   |        |      |  |   |             |   |  |             |    |  |    |  
|Total in operating expenses        |  |                         | 21,020 |   |                   |   | 18,360 |      |  |   | 15,098      |   |  | 14          | %  |  | 22 | %
|                                   |  |                         |        |   |                   |   |        |      |  |   |             |   |  |             |    |  |    |  
|Total                              |  | $                       | 23,546 |   |                   | $ | 20,972 |      |  | $ | 17,563      |   |  | 12          | %  |  | 19 | %
|                                   |  |                         |        |   |                   |   |        |      |  |   |             |   |  |             |    |  |    |  
|Percentage of total revenue        |  |                         | 4      | % |                   |   | 3      | %    |  |   | 3           | % |  |             |    |  |    |  

We utilize the Black-Scholes option pricing model to value equity instruments. The
Black-Scholes model was developed for use in estimating the value of traded options that have no vesting or hedging restrictions and are fully transferable. Because our employee stock options have certain characteristics that are significantly
different from traded options, and because changes in the subjective assumptions can materially affect the estimated value, in managements opinion, the existing valuation model may not provide an accurate measure of the fair value of our
employee stock options. Although the fair value of employee stock options is determined using an option-pricing model, that value may not be indicative of the fair value observed in a willing buyer/willing seller market transaction.

Our determination of fair value of stock-based payment awards on the date of grant using an option-pricing model is affected by our stock
price, as well as assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to, our expected stock price volatility over the term of the awards, and actual and projected employee stock
option exercise behaviors. In the future, as empirical evidence regarding these input estimates is available to provide more directionally predictive results, we may change or refine our approach of deriving these input estimates. These changes
could impact our fair value of stock options granted in the future. Changes in the fair value of the stock options could materially impact our operating results and financial position.

Interest Income



|                            |  |                         |       |   |                   |   |       |      |  |   |             |   |  |             |    |  |     |   
|--------------------------- |  | ----------------------- | ----- | - | ----------------- | - | ----- | ---- |  | - | ----------- | - |  | ----------- | -- |  | --- | --
|                            |  | Year Ended November 30, |       |   | Percentage Change |  
|                            |  | 2009                    |       |   | 2008              |   |       | 2007 |  |   | 2008to 2009 |   |  | 2007to 2008 |   
|Interest income             |  | $                       | 2,265 |   |                   | $ | 9,115 |      |  | $ | 18,447      |   |  | (75         | )% |  | (51 | )%
|Percentage of total revenue |  |                         |      | % |                   |   | 1     | %    |  |   | 3           | % |  |             |    |  |     |   

Interest income decreased by $6.9 million or 75% in fiscal year 2009 compared to
fiscal year 2008 and by $9.3 million or 51% in fiscal year 2008 compared to fiscal year 2007. The decreases in interest income in fiscal year 2009 compared to fiscal year 2008 and in fiscal year 2008 compared to fiscal year 2007 were primarily due
to lower returns from investments.



34



---

##### Table of Contents

Interest Expense



|                            |  |                         |        |   |                   |   |        |      |  |   |             |    |  |             |    |  |    |  
|--------------------------- |  | ----------------------- | ------ | - | ----------------- | - | ------ | ---- |  | - | ----------- | -- |  | ----------- | -- |  | -- | -
|                            |  | Year Ended November 30, |        |   | Percentage Change |  
|                            |  | 2009                    |        |   | 2008              |   |        | 2007 |  |   | 2008to 2009 |    |  | 2007to 2008 |   
|Interest expense            |  | $                       | (2,968 | ) |                   | $ | (3,238 | )    |  | $ | (2,824      | )  |  | (8          | )% |  | 15 | %
|Percentage of total revenue |  |                         |       | % |                   |   |       | %    |  |   | (1          | )% |  |             |    |  |    |  

Interest expense decreased by $0.3 million or 8% in fiscal year 2009 compared to
fiscal year 2008 and increased by $0.4 million or 15% in fiscal year 2008 compared to fiscal year 2007. Interest expense was primarily related to a $54.0 million mortgage note issued in connection with the purchase of our corporate headquarters. The
mortgage note payable carries a 20-year amortization, and in the second quarter of fiscal year 2007, we amended the mortgage note payable such that it now carries a fixed annual interest rate of 5.50%. The balance of the mortgage note as of
November 30, 2009, was $42.5 million. The $34.4 million principal balance that will remain at the end of the ten-year term will be due as a final lump sum payment on July 1, 2013. See Note 10 to our Consolidated Financial Statements
included in this Annual Report on Form 10-K for further detail on the mortgage note payable.

Other Income (Expense), net

Other income (expense), net, included realized gains and losses on investments, foreign exchange gain (loss) and other
miscellaneous income and expense items.



|                                               |  |                         |       |   |                   |   |        |      |  |   |             |   |  |             |   |  |     |   
|---------------------------------------------- |  | ----------------------- | ----- | - | ----------------- | - | ------ | ---- |  | - | ----------- | - |  | ----------- | - |  | --- | --
|                                               |  | Year Ended November 30, |       |   | Percentage Change |  
|                                               |  | 2009                    |       |   | 2008              |   |        | 2007 |  |   | 2008to 2009 |   |  | 2007to 2008 |  
|Other income (expense):                        |  |                         |       |   |                   |   |        |      |  |   |             |   |  |             |   |  |     |   
|Foreign exchange gain (loss)                   |  | $                       | 1,655 |   |                   | $ | (1,081 | )    |  | $ | (1,502      | ) |  |             |   |  |     |   
|Realized gain (loss) on short-term investments |  |                         | (108  | ) |                   |   | 235    |      |  |   | (312        | ) |  |             |   |  |     |   
|Realized gain on other investments             |  |                         |      |   |                   |   | 125    |      |  |   | 64          |   |  |             |   |  |     |   
|Other income (expense), net                    |  |                         | 171   |   |                   |   | (61    | )    |  |   | 569         |   |  |             |   |  |     |   
|                                               |  |                         |       |   |                   |   |        |      |  |   |             |   |  |             |   |  |     |   
|Total other income (expense), net              |  | $                       | 1,718 |   |                   | $ | (782   | )    |  | $ | (1,181      | ) |  | *           | % |  | (34 | )%
|                                               |  |                         |       |   |                   |   |        |      |  |   |             |   |  |             |   |  |     |   
|Percentage of total revenue                    |  |                         |      | % |                   |   |       | %    |  |   |            | % |  |             |   |  |     |   



|* | Percentage is not meaningful
|- | ----------------------------

The increase in other income (expense) in absolute dollars in fiscal year 2009 compared to fiscal year 2008 was primarily due to a $1.7 million foreign exchange gain in fiscal year 2009 compared to a $1.1 million loss in fiscal year 2008.

The increase in other income (expense) in absolute dollars in fiscal year 2008 compared to fiscal year 2007 was primarily due
to a $0.4 million in foreign exchange improvement compared to losses in the prior year, a $0.2 million gain from the sale of a short-term investment and a $0.1 million gain from the sale of a long-term private equity investment.

Income Taxes



|                                        |  |                         |        |   |                   |   |        |      |  |   |             |   |  |             |   |  |     |   
|--------------------------------------- |  | ----------------------- | ------ | - | ----------------- | - | ------ | ---- |  | - | ----------- | - |  | ----------- | - |  | --- | --
|                                        |  | Year Ended November 30, |        |   | Percentage Change |  
|                                        |  | 2009                    |        |   | 2008              |   |        | 2007 |  |   | 2009to 2008 |   |  | 2007to 2008 |  
|Provision for (benefit from) income tax |  | $                       | 27,097 |   |                   | $ | 18,314 |      |  | $ | 25,401      |   |  | 48          | % |  | (28 | )%
|Effective tax rate                      |  |                         | 30     | % |                   |   | 26     | %    |  |   | 33          | % |  |             |   |  |     |   



35



---

##### Table of Contents

The effective tax rate was 30%, 26% and 33% in fiscal years 2009, 2008 and 2007,
respectively. The effective tax rate in fiscal year 2009 differed from the statutory rate of 35% primarily due to the benefits resulting from the reorganization of certain foreign entities, foreign income taxed at rates lower than the U.S. statutory
rate and research and development credits which was partially offset by the tax impact of certain stock compensation charges and state income tax expense. The effective tax rate in fiscal year 2008 differed from the statutory rate of 35% primarily
due to the benefits resulting from the reorganization of certain foreign entities, foreign income taxed at rates lower than the U.S. statutory rate, research and development credits and the release of valuation allowance resulting from the ability
to claim capital loss and foreign tax credit carryovers, which was partially offset by the tax impact of certain stock compensation charges and state income tax expense. The effective tax rate in fiscal year 2007 differed from the statutory rate of
35% primarily due to research and development credits and the release of valuation allowance resulting from the ability to claim foreign tax credits against our foreign source income, which was partially offset by the tax impact of certain stock
compensation charges and state income tax expense.

In February 2009, the California 2009-2010 budget legislation was signed
into law. One of the major components of this legislation is the ability to elect to apply a single sales factor apportionment for years beginning after January 1, 2011. As a result of our anticipated election of the single sales factor, we are
required to re-measure our deferred taxes taking into account the reversal pattern and the expected California tax rate under the elective single sales factor. We have determined that by electing a single sales factor apportionment, our California
deferred tax assets will decrease by approximately $1.1 million (net of federal benefit). The tax impact of $1.1 million has been recorded as a discrete item in the first quarter of fiscal year 2009.

See Note 19 to our Consolidated Financial Statements included in this Annual Report on Form 10-K.

Liquidity and Capital Resources

Current Cash Flows

As of November 30, 2009, we had cash, cash equivalents and short-term investments
totaling $292.8 million, representing an increase of $25.4 million from November 30, 2008. Our total cash and cash equivalents balance was $292.5 million as of November 30, 2009. As of November 30, 2009, our short-term
available-for-sale investments totaled $0.3 million, consisting of mortgage-backed securities.

Net cash provided by operating
activities in fiscal year 2009 was $115.4 million, resulting from net income of $62.3 million and adjusted for $59.6 million in non-cash charges, which were partially offset by a $6.5 million net change in assets and liabilities. The
non-cash charges included depreciation and amortization, tax benefits related to stock benefit plans, stock-based compensation, other non-cash adjustments and minority interest, less deferred income tax and excess tax benefits from stock-based
compensation recorded in financing activities. Net change in assets and liabilities included an increase in accounts receivable due to increased total revenue in the fourth quarter of fiscal year 2009, a decrease in prepaid expenses and other
assets, an increase in accounts payable, a decrease in accrued liabilities and excess facilities costs and an increase in deferred revenue.

To the extent that non-cash items increase or decrease our future operating results, there will be no corresponding impact on our cash flows. After excluding the effects of these non-cash charges, the
primary changes in cash flows relating to operating activities result from changes in working capital. Our primary source of operating cash flows is the collection of accounts receivable from our customers, including maintenance which is typically
billed annually in advance. Our operating cash flows are also impacted by the timing of payments to our vendors for accounts payable and other liabilities. We generally pay our vendors and service providers in accordance with the invoice terms and
conditions. The timing of cash payments in future periods will be impacted by the terms of accounts payable arrangements.

Net
cash used in investing activities was $22.7 million in fiscal year 2009, resulting primarily from cash used, net of cash acquired, of $27.3 million for the DataSynapse acquisition, cash used of $5.4 million in capital



36



---

##### Table of Contents

expenditures and $2.6 million in restricted cash pledged as security, which were partially offset by the net cash proceeds from short-term investments of $12.4 million and $0.1 million of
proceeds from private equity investments. In addition, we used part of the net proceeds from sales of short-term investments to finance our stock repurchase program.

Net cash used in financing activities was $67.7 million in fiscal year 2009, resulting primarily from our $106.4 million repurchase of shares of our common stock on the open market, $2.3 million payment
of issuance costs on line of credit and $2.0 million repayment of long-term debt, less $28.4 million cash received from the exercise of stock options and the sale of stock under our Employee Stock Purchase Program and $17.0 million excess tax
benefits from stock-based compensation.

In April 2008, our Board of Directors approved a new stock repurchase program
pursuant to which we may repurchase up to $300.0 million of our outstanding common stock from time to time in the open market or through privately negotiated transactions. In fiscal year 2009, we repurchased approximately 12.9 million shares of
our outstanding common stock at an average price of $8.23 per share pursuant to the programs, for an aggregate purchase price of approximately $106.4 million. As of November 30, 2009, the remaining authorized amount for stock repurchases under
the April 2008 stock repurchase program was approximately $89.8 million.

We currently anticipate that our operating expenses
will grow in absolute dollars for the foreseeable future, and we intend to fund our operating expenses primarily through cash flows from operations. We believe that our current cash, cash equivalents and short-term investments and amounts available
under our line of credit together with expected cash flows from operations will be sufficient to meet our anticipated cash requirements for working capital, capital expenditures, and currently approved stock repurchases for at least the next twelve
months. Should demand for our products and services significantly decline over the next twelve months, the available cash provided by operations could be adversely impacted.

Line of Credit

In November 2009, we entered into a $150.0 million unsecured revolving credit facility (the Credit Agreement) that matures in November 2012. The revolving credit facility is available for cash borrowings up to $150.0 million,
with a sublimit for the issuance of standby letters of credit in a face amount up to $25.0 million and swing line loans up to $10.0 million. At the same time, we canceled an existing standalone irrevocable letter of credit in the amount of $4.5
million in connection with a facility lease and issued a new letter of credit under this facility in the same amount. As of November 30, 2009, no amounts were outstanding under the Credit Agreement and a $4.5 million irrevocable letter of
credit was outstanding, leaving $145.5 million of available credit for cash borrowings, of which $20.5 million is available for additional letters of credit. Revolving loans accrue interest at a per annum rate based on either (i) the base rate
plus a margin ranging from 2.25% to 3.00%, depending on TIBCOs consolidated leverage ratio or (ii) the LIBOR rate plus a margin ranging from 3.25% to 4.00%, depending on TIBCOs consolidated leverage ratio, for various interest
periods. The base rate is defined as the highest of (i) the administrative agents prime rate (ii) the federal funds rate plus a margin equal to 0.50%, and (iii) except during a period when LIBOR rates are unavailable, the LIBOR
rate for a one month interest period plus a margin equal to 1.00%. Swing line loans accrue interest at a per annum rate based on the base rate plus a margin ranging from 2.25% to 3.00%. A commitment fee is applied to the un-borrowed amount at a per
annum rate ranging from 0.50% to 0.75%. Under this Credit Agreement, we must maintain a minimum consolidated interest coverage ratio of 3.5:1.0 and a maximum consolidated leverage ratio of 2.5:1.0 in addition to other customary affirmative and
negative covenants.

In connection with a facility lease, we have an irrevocable letter of credit in the amount of $4.5
million. The letter of credit automatically renews annually for the duration of the lease term, which expires in December 2010. In November 2009, the initial letter of credit was cancelled under a standalone letter of credit and we issued a new
letter of credit under the Credit Agreement, which is subject to the financial covenants defined in the Credit Agreement; see Note 10 for further details. As of November 30, 2009 we were in compliance with all letters of credit covenants.



37



---

##### Table of Contents

We have a $20.0 million revolving line of credit that matures on June 17, 2010. The
revolving line of credit is available for cash borrowings and for the issuance of letters of credit up to $20.0 million. As of November 30, 2009, no borrowings were outstanding under the facility and two irrevocable letters of credit in the
amounts of $13.0 million and approximately $1.0 million were outstanding, leaving $6.0 million of available credit for additional letters of credit or cash borrowings. The $13.0 million irrevocable letter of credit outstanding was issued in
connection with the mortgage note payable. The letter of credit automatically renews for successive one-year periods, until the mortgage note payable has been satisfied in full. The approximately $1.0 million irrevocable letter of credit outstanding
was issued in connection with a sales transaction denominated in foreign currency and will remain outstanding until July 2012. The line of credit, as amended, contains financial covenants identical to those of the Credit Agreement, as well as other
customary affirmative and negative covenants. As of November 30, 2009, we were in compliance with all covenants under the revolving line of credit.

Fair Value Inputs

Beginning in fiscal year 2008, we adopted guidance for
fair value measurements. See Note 2 to the Consolidated Financial Statements included in this Annual Report on Form 10-K. Fair value is a market-based measurement that should be determined based on assumptions that market participants would use
in pricing an asset or liability. The use of fair value to measure investment instruments, with related unrealized and realized gains or losses on investment, is a component to our consolidated results of operations.

We value our cash, cash equivalents, and investment instruments by using quoted market prices, broker or dealer quotations, or alternative
pricing sources with reasonable levels of price transparency. The types of instruments valued based on quoted market prices in active markets include money market securities. We do not adjust the quoted price for such instruments. The types of
instruments valued based on quoted prices in markets that are not active, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency include mortgage-backed products. The price for each security at the
measurement date is derived from various sources. Periodically, management assesses the reasonableness of these sourced prices by comparing them to the prices provided by our portfolio managers to derive the fair value of these financial
instruments. Historically, we have not experienced significant deviation between the sourced prices and our portfolio managers prices. Management assesses the inputs of the pricing in order to categorize the financial instruments into the
appropriate hierarchy levels.

Commitments

In June 2003, we purchased our corporate headquarters with a $54.0 million mortgage note to lower our operating costs. The mortgage note
payable carries a 20-year amortization and, as amended in the second quarter of fiscal year 2007, a fixed annual interest rate of 5.50%. The principal balance of $34.4 million that will be remaining at the end of the 10-year term will be due as a
final lump sum payment on July 1, 2013. Under the applicable terms of the mortgage note agreements, we are prohibited from acquiring another company without prior consent from the lender unless we maintain at least $50.0 million of cash or cash
equivalents and meet other non-financial terms as defined in the agreements. In addition, we are subject to certain non-financial covenants as defined in the agreements. We were in compliance with all covenants as of November 30, 2009.

In conjunction with the purchase of our corporate headquarters, we entered into a 51-year lease of the land upon which the
property is located. The lease was paid in advance for a total of $28.0 million, but is subject to adjustments every ten years based upon changes in fair market value of the land. Should it become necessary, we have the option to prepay any rent
increases due as a result of a change in fair market value.

As of November 30, 2009, we had $5.6 million in restricted
cash in connection with bank guarantees issued by some of our international subsidiaries. The cash collateral is presented as restricted cash and included in Other Assets in our Consolidated Balance Sheet.



38



---

##### Table of Contents

As of November 30, 2009, our contractual commitments associated with indebtedness,
lease obligations and restructuring are as follows (in thousands):



|                                   |  |       |        |   |      |   |        |      |  |   |        |   |      |   |        |  |            |        |  |   |       |  |   |      
|---------------------------------- |  | ----- | ------ | - | ---- | - | ------ | ---- |  | - | ------ | - | ---- | - | ------ |  | ---------- | ------ |  | - | ----- |  | - | -----
|                                   |  | Total |        |   | 2010 |   |        | 2011 |  |   | 2012   |   | 2013 |   | 2014   |  | Thereafter
|Operating commitments:             |  |       |        |   |      |   |        |      |  |   |        |   |      |   |        |  |            |        |  |   |       |  |   |      
|Debt principal                     |  | $     | 42,525 |   |      | $ | 2,148  |      |  | $ | 2,269  |   |      | $ | 2,397  |  | $          | 35,711 |  | $ |      |  | $ |     
|Debt interest                      |  |       | 7,768  |   |      |   | 2,285  |      |  |   | 2,164  |   |      |   | 2,036  |  |            | 1,283  |  |   |      |  |   |     
|Operating leases                   |  |       | 31,124 |   |      |   | 9,849  |      |  |   | 8,313  |   |      |   | 5,648  |  |            | 3,881  |  |   | 2,483 |  |   | 950  
|                                   |  |       |        |   |      |   |        |      |  |   |        |   |      |   |        |  |            |        |  |   |       |  |   |      
|                                   |  |       | 81,417 |   |      |   | 14,282 |      |  |   | 12,746 |   |      |   | 10,081 |  |            | 40,875 |  |   | 2,483 |  |   | 950  
|                                   |  |       |        |   |      |   |        |      |  |   |        |   |      |   |        |  |            |        |  |   |       |  |   |      
|Restructuring-related commitments: |  |       |        |   |      |   |        |      |  |   |        |   |      |   |        |  |            |        |  |   |       |  |   |      
|Gross lease obligations            |  |       | 8,497  |   |      |   | 7,288  |      |  |   | 734    |   |      |   | 75     |  |            | 75     |  |   | 75    |  |   | 250  
|Committed sublease income          |  |       | (2,871 | ) |      |   | (2,632 | )    |  |   | (239   | ) |      |   |       |  |            |       |  |   |      |  |   |     
|                                   |  |       |        |   |      |   |        |      |  |   |        |   |      |   |        |  |            |        |  |   |       |  |   |      
|                                   |  |       | 5,626  |   |      |   | 4,656  |      |  |   | 495    |   |      |   | 75     |  |            | 75     |  |   | 75    |  |   | 250  
|                                   |  |       |        |   |      |   |        |      |  |   |        |   |      |   |        |  |            |        |  |   |       |  |   |      
|Total commitments                  |  | $     | 87,043 |   |      | $ | 18,938 |      |  | $ | 13,241 |   |      | $ | 10,156 |  | $          | 40,950 |  | $ | 2,558 |  | $ | 1,200
|                                   |  |       |        |   |      |   |        |      |  |   |        |   |      |   |        |  |            |        |  |   |       |  |   |      

The obligations disclosed above do not include contractual obligations recorded on
our balance sheet as current liabilities except for the current portion of long-term debt. The expected timing of payment amounts of the obligations discussed above is estimated based on current information. Timing and actual amounts paid may differ
depending on the timing of receipt of goods or services, market prices or changes to agreed-upon amounts for some obligations.

Future minimum lease payments under restructured non-cancelable operating leases as of November 30, 2009 are included in Accrued Restructuring and Excess Facilities Costs on our Consolidated Balance Sheets. See also Note 9 to our
Consolidated Financial Statements included in this Annual Report on Form 10-K for further details on accrued restructuring costs.

The above commitment table does not include approximately $17.0 million of long-term income tax liabilities recorded in accounting for uncertainty in income taxes due to the fact that we are unable to reasonably estimate the timing of these
potential future payments.

Indemnification

Our software license agreements typically provide for indemnification of customers for intellectual property infringement claims. To date, no
such claims have been filed against us. We also warrant to customers that our software products operate substantially in accordance with the software products specifications. Historically, minimal costs have been incurred related to product
warranties, and, as such, no accruals for warranty costs have been made. In addition, we indemnify our officers and directors under the terms of indemnity agreements entered into with them, as well as pursuant to our certificate of incorporation,
bylaws and applicable provisions of Delaware law.

To date, we have incurred costs for the payment of legal fees in connection
with the legal proceedings detailed in Note 13 to our Consolidated Financial Statements included in this Annual Report on Form 10-K.

Off-Balance Sheet Arrangements

As of November 30, 2009, we had no off-balance sheet arrangements as
defined in Item 303(a)(4) of Regulation S-K.

Recent Accounting Pronouncements

Recent accounting pronouncements are detailed in Note 2 to our Consolidated Financial Statements included in this Annual Report on Form
10-K.



39



---

##### Table of Contents

|ITEM 7A. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|-------- | ----------------------------------------------------------

We are exposed to the impact of foreign currency fluctuations, interest rate changes and uncertainties in the credit market.

Interest Rate Risk

Our exposure to market rate risk for changes in
interest rates relates primarily to our investment portfolio. We invest excess cash in marketable debt instruments of the United States government and its agencies, high-quality corporate debt securities, asset-backed and mortgage-backed debt
securities and, by policy, limit the amount of credit exposure to any one issuer. Our investment policy is intended to protect and preserve invested funds by limiting default, market and investment risk.

Investments in both fixed rate and floating rate interest earning instruments carry a degree of interest rate risk. Fixed rate
securities may have their fair market value adversely impacted due to a rise in interest rates, while floating rate securities may produce less income than expected if interest rates fall. Due in part to these factors, our future investment
income may fall short of expectations due to changes in interest rates, or we may suffer losses in principal if forced to sell securities which have declined in market value due to changes in interest rates or other factors in the current unstable
credit environment. As of November 30, 2009, we had an investment portfolio of fixed income securities totaling $0.3 million, excluding those classified as cash and cash equivalents. These securities are classified as available-for-sale
and are recorded on the balance sheets at fair market value with unrealized gains or losses reported under Accumulated Other Comprehensive Income (Loss), a separate component of stockholders equity. Unrealized losses are charged against income
when a decline in fair market value is determined to be other-than-temporary. The specific identification method is used to determine the cost of securities sold.

As of November 30, 2009, a hypothetical 100 basis point increase in interest rates would not have an impact on the fair value of our available-for-sale debt securities.

Foreign Currency Risk

We
conduct business in the Americas, EMEA and APJ. As a result, our financial results could be affected by factors such as changes in foreign currency exchange rates or changes in economic conditions in foreign markets. The majority of our transactions
are currently made in U.S. dollars. In addition, we transact business in approximately 20 foreign currencies worldwide, of which the most significant to our operations in fiscal year 2009 was the EURO. We enter into forward contracts with financial
institutions to manage our currency exposure related to net assets and liabilities denominated in foreign currencies, and these forward contracts are generally settled monthly. We do not enter into derivative financial instruments for trading
purposes.

We are also exposed to foreign exchange rate fluctuations as we convert the financial statements of our foreign
subsidiaries into U.S. dollars in consolidation. If there is a change in foreign currency exchange rates, the conversion of the foreign subsidiaries financial statements into U.S. dollars will lead to translation gains or losses, which
are recorded net as a component of other comprehensive income.



40



---

##### Table of Contents

As of November 30, 2009, we had six outstanding forward contracts with a total notional
amount of $65.2 million, which are summarized as follows (in thousands):



|                        |  |                             |  |                  |        |                          |   |     |  
|----------------------- |  | --------------------------- |  | ---------------- | ------ | ------------------------ | - | --- | -
|                        |  | NotionalValueLocal Currency |  | NotionalValueUSD |        | Fair ValueGain (Loss)USD |  
|Forward contracts sold: |  |                             |  |                  |        |                          |   |     |  
|EURO                    |  | 38,600                      |  | $                | 57,867 |                          | $ | 311 |  
|Australian dollar       |  | 2,700                       |  |                  | 2,463  |                          |   | 37  |  
|Japanese yen            |  | 50,000                      |  |                  | 581    |                          |   | (9  | )
|South African rand      |  | 16,200                      |  |                  | 2,172  |                          |   | 11  |  
|Swiss franc             |  | 1,200                       |  |                  | 1,194  |                          |   | 8   |  
|New Taiwan dollar       |  | 29,000                      |  |                  | 903    |                          |   | (5  | )
|                        |  |                             |  |                  |        |                          |   |     |  
|                        |  |                             |  | $                | 65,180 |                          | $ | 353 |  
|                        |  |                             |  |                  |        |                          |   |     |  



|ITEM 8. | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
|------- | -------------------------------------------

Reference is made to the Index to Consolidated Financial Statements that appears on page F-1 of this Annual Report on Form 10-K. The Report of Independent Registered Public Accounting Firm from
PricewaterhouseCoopers LLP, the Consolidated Financial Statements and the Notes to Consolidated Financial Statements listed in the Index to Consolidated Financial Statements, which appear beginning on page F-2 of this Annual Report on Form 10-K, are
incorporated by reference into this Item 8.



|ITEM 9. | CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
|------- | ------------------------------------------------------------------------------------

Not applicable.



|ITEM 9A. | CONTROLS AND PROCEDURES
|-------- | -----------------------

Evaluation of Disclosure Controls and Procedures.    Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an
evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, as of the end of the period covered by this report.
Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were effective at the reasonable assurance level to ensure
that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and that such information is
accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

Our disclosure controls and procedures are designed to provide reasonable assurance of achieving their objectives as specified above. In
designing and evaluating our disclosure controls and procedures, management recognized that disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of
the disclosure controls and procedures are met. Additionally, the design of a control system must reflect that there are resource constraints, thus, in designing disclosure controls and procedures, our management necessarily was required to apply
its judgment in evaluating the cost-benefit relationship of possible disclosure controls and procedures. The design of any disclosure controls and procedures also is based in part upon certain assumptions about the likelihood of future events, and
there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.



41



---

##### Table of Contents

Managements Report on Internal Control over Financial
Reporting.    Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act. Our internal control over
financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles in the
United States. Our internal control over financial reporting includes those policies and procedures that:

(i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets;

(ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial
statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and

(iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or
disposition of our assets that could have a material effect on the financial statements.

Because of its inherent limitations,
including the possibility of human error and the circumvention or overriding of controls, internal control over financial reporting may not prevent or detect misstatements and can provide only reasonable assurance with respect to financial statement
preparation. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may
deteriorate.

We assessed the effectiveness of our internal control over financial reporting as of November 30, 2009. In
making this assessment, we used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal ControlIntegrated Framework. Based on the results of our assessment using those criteria,
management concluded that our internal control over financial reporting was effective as of November 30, 2009.

The
effectiveness of our internal control over financial reporting as of November 30, 2009, has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report that appears on page F-2 of this
Annual Report on Form 10-K.

Changes in Internal Control over Financial Reporting.    There were no
changes in our internal control over financial reporting that occurred during the fourth quarter of fiscal year 2009 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.



|ITEM 9B. | OTHER INFORMATION
|-------- | -----------------

FY 2010 TIBCO
Executive Incentive Compensation Plan

On January 29, 2010, the Compensation Committee of the Board of Directors of TIBCO
Software Inc. (the Committee) approved the terms of the FY 2010 TIBCO Executive Incentive Compensation Plan (the EICP). The EICP provides for the payment of cash bonuses to eligible Section 16 Officers based on the attainment
of certain corporate performance criteria established by the Committee. There is also a discretionary component to the EICP which permits the Committee to award cash bonuses on individual performance.



42



---

##### Table of Contents

PART III



|ITEM 10. | DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
|-------- | ------------------------------------------------------

Except as set forth below, the information required by this Item is incorporated by reference to the sections entitled Board of Directors, Election of Directors, and
Section 16(a) Beneficial Ownership Reporting Compliance in our Proxy Statement for the 2010 Annual Meeting of Stockholders to be filed with the SEC within 120 days after the end of our fiscal year ended November 30, 2009.

Executive Officers

The name of and certain information regarding each of our current executive officers as of November 30, 2009 are set forth below.

Vivek Y. Ranadivé, age 52, has served as our Chairman and Chief Executive Officer since our inception. Mr. Ranadivé founded Teknekron Software Systems, Inc., our
predecessor company, in 1985.

Sydney L. Carey, age 45, has served as our Executive Vice President, Chief
Financial Officer, since January 2009, and has served in various capacities with us since January 2004. From February 2002 to January 2004, Ms. Carey was Chief Financial Officer of Vernier Networks. From December 2000 until February 2002,
Ms. Carey was Chief Financial Officer of Pacific Broadband Communications.

William R. Hughes, age 49, has
served as our Executive Vice President, General Counsel and Secretary since July 2004 and has served in various capacities with us since September 1999. Between 1989 and his joining TIBCO in 1999, Mr. Hughes held several in-house legal
positions in the technology industry in Europe and the United States. Prior to 1989, Mr. Hughes worked in private practice in the areas of corporate, finance and intellectual property law.

Thomas Laffey, age 54, has served as our Executive Vice President, Products and Technology, since June 2005 and has served in
various capacities with us since April 2002. Prior to joining TIBCO, Mr. Laffey was a co-founder of Talarian Corporation, a provider of middleware, where he was responsible for engineering and product direction.

Ram Menon, age 44, has served as our Executive Vice President, Worldwide Marketing since July 2006 and has served in various
capacities with us since July 1999. Prior to joining TIBCO, Mr. Menon was with Accenture, a global consulting firm, where he specialized in supply chain and e-commerce strategy consulting with Global 1000 companies.

Murray D. Rode, age 45, has served as our Executive Vice President, Chief Operating Officer since January 2009 and has served
in various capacities with us since February 1995. Prior to joining TIBCO, Mr. Rode was a management consultant with a major international consulting firm, where he specialized in the areas of technology strategy and planning, business process
re-engineering and project management.

Murat Sonmez, age 46, has served as our Executive Vice President, Global
Field Operations since April 2007 and has served in various capacities with us since October 2003 and from January 1994 to July 2002. From August 2002 to September 2003, Mr. Sonmez served as Executive Vice President, Operations at Centrata, a
utility computing software firm.

Troy O. Mitchell, age 49, has served as our Vice President, Corporate
Controller since February 2009 and has served in various capacities with us since September 2004. From April 2002 to August 2004, Mr. Mitchell held a number of positions at Portal Software, including Corporate Controller.

Code of Ethics

We have
adopted a Code of Ethics for Chief Executive and Senior Financial Officers that applies to our Chief Executive Officer, Chief Financial Officer, Chief Accounting Officer, Corporate Controller and all others performing similar functions. The Code of
Ethics is available on our website at http://www.tibco.com/company/



43



---

##### Table of Contents

investor_info/corporate_governance/code_ethics. If we make any substantive amendments to the Code of Ethics or grant any waiver, including any implicit waiver, from a provision of the code
to our Chief Executive Officer, Chief Financial Officer, Chief Accounting Officer, Corporate Controller or others providing similar functions, we will disclose the nature of such amendment or waiver on our website or in a current report on Form 8-K.



|ITEM 11. | EXECUTIVE COMPENSATION
|-------- | ----------------------

The information required by this item is incorporated by reference to the sections entitled Compensation Discussion and Analysis, Election of DirectorsFiscal Year 2009 Director Compensation, Board of
Directors  Compensation Committee Interlocks and Insider Participation and Compensation Committee Report in our Proxy Statement for the 2010 Annual Meeting of Stockholders to be filed with the SEC within 120 days after
the end of our fiscal year ended November 30, 2009.



|ITEM 12. | SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
|-------- | ----------------------------------------------------------------------------------------------

The information required by this item regarding security ownership of certain beneficial owners and management is incorporated by reference
to the section entitled Security Ownership of Certain Beneficial Owners and Management in our Proxy Statement for the 2010 Annual Meeting of Stockholders to be filed with the SEC within 120 days after the end of our fiscal year ended
November 30, 2009.

The information required by this item regarding equity compensation plans is incorporated by
reference to the section entitled Equity Compensation Plan Information set forth in Item 5 of this Annual Report on Form 10-K.



|ITEM 13. | CERTAIN RELATIONSHIPS, RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE
|-------- | ---------------------------------------------------------------------

Certain Relationships and Related Party Transactions

The information
required by this item regarding certain relationships and related party transactions is incorporated by reference to the section entitled Related Party Transactions Policy and Procedures in our Proxy Statement for the 2010 Annual Meeting
of Stockholders to be filed with the SEC within 120 days after the end of our fiscal year ended November 30, 2009.

Director
Independence

The information required by this item regarding director independence is incorporated by reference to the
section entitled Board of Directors  Director Independence and Presiding Director in our Proxy Statement for the 2010 Annual Meeting of Stockholders to be filed with the SEC within 120 days after the end of our fiscal year ended
November 30, 2009.



|ITEM 14. | PRINCIPAL ACCOUNTING FEES AND SERVICES
|-------- | --------------------------------------

The information required by this item is incorporated by reference to the section entitled Audit Committee MattersFees Paid to the Independent Auditors and Ratification of
Appointment of Independent Auditors- Audit Committee Pre-Approval of Audit and Non-Audit Services of the Independent Auditor in our Proxy Statement for the 2010 Annual Meeting of Stockholders to be filed with the SEC within 120 days after the
end of our fiscal year ended November 30, 2009.



44



---

##### Table of Contents

PART IV



|ITEM 15. | EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
|-------- | ------------------------------------------

(a) The following documents are filed as part of this Annual Report on Form 10-K:

1. Financial Statements.    Please see the accompanying Index to Consolidated Financial Statements, which appears on page F-1 of this Annual Report on Form 10-K. The Report of
Independent Registered Public Accounting Firm, the Consolidated Financial Statements and the Notes to Consolidated Financial Statements listed in the Index to Consolidated Financial Statements, which appear beginning on page F-2 of this Annual
Report on Form 10-K, are incorporated by reference into Item 8 above.

2. Financial Statement
Schedules.    Financial Statement Schedules have been omitted because the information required to be set forth therein is either not applicable or is included in the Consolidated Financial Statements or the Notes to
Consolidated Financial Statements.

3. Exhibits.    See Item 15(b) below. Each
management contract and compensatory plan or arrangement required to be filed has been identified.

(b)
Exhibits.    The exhibits listed on the accompanying Exhibit Index immediately following the signature page are filed as part of, or are incorporated by reference into, this Annual Report on Form 10-K.

(c) Financial Statement Schedules.    Reference is made to Item 15(a)(2) above.



45



---

##### Table of Contents

TIBCO SOFTWARE INC.

INDEX TO THE CONSOLIDATED FINANCIAL STATEMENTS



|                                                                                |  |     
|------------------------------------------------------------------------------- |  | ----
|                                                                                |  | Page
|                                                                                | 
|Report of Independent Registered Public Accounting Firm                         |  | F-2 
|                                                                                | 
|Consolidated Balance Sheets                                                     |  | F-3 
|                                                                                | 
|Consolidated Statements of Operations                                           |  | F-4 
|                                                                                | 
|Consolidated Statements of Stockholders Equity and Comprehensive Income (Loss) |  | F-5 
|                                                                                | 
|Consolidated Statements of Cash Flows                                           |  | F-6 
|                                                                                | 
|Notes to Consolidated Financial Statements                                      |  | F-7 



F-1



---

##### Table of Contents

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of

TIBCO Software Inc.:

In our opinion, the accompanying Consolidated Balance Sheets and the
related Consolidated Statements of Operations, Consolidated Statements of Stockholders Equity and Comprehensive Income (Loss) and Consolidated Statements of Cash Flows listed in the Index to the Consolidated Financial Statements of TIBCO
Software Inc., present fairly, in all material respects, the financial position of TIBCO Software Inc. and its subsidiaries at November 30, 2009 and November 30, 2008, and the results of their operations and their cash flows for each of
the three years in the period ended November 30, 2009 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control
over financial reporting as of November 30, 2009, based on criteria established in Internal ControlIntegrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Companys
management is responsible for these financial statements, for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in Managements
Report on Internal Control over Financial Reporting appearing under Item 9A of this Annual Report on Form 10-K. Our responsibility is to express opinions on these financial statements and on the Companys internal control over financial
reporting based on our integrated audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable
assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on
a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit
of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of
internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

As discussed in Note 19 to the Consolidated Financial Statements, effective December 1, 2007, the Company changed the manner in which
it accounts for uncertain tax positions and its methods of accounting for fair value measurements.

A companys internal
control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted
accounting principles. A companys internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions
and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that
receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use, or disposition of the companys assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/    PRICEWATERHOUSECOOPERS LLP

San Jose, California

January 29, 2010



F-2



---

##### Table of Contents

TIBCO SOFTWARE INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except par value)





|                                                                                                                                    |  |              |           |   |      |   |           |  
|----------------------------------------------------------------------------------------------------------------------------------- |  | ------------ | --------- | - | ---- | - | --------- | -
|                                                                                                                                    |  | November 30, |          
|                                                                                                                                    |  | 2009         |           |   | 2008 |  
|Assets                                                                                                                              |  |              |           |   |      |   |           |  
|Current assets:                                                                                                                     |  |              |           |   |      |   |           |  
|Cash and cash equivalents                                                                                                           |  | $            | 292,529   |   |      | $ | 254,400   |  
|Short-term investments                                                                                                              |  |              | 307       |   |      |   | 13,073    |  
|Accounts receivable, net of allowances of $4,224 in 2009 and $4,369 in 2008                                                         |  |              | 154,744   |   |      |   | 133,191   |  
|Prepaid expenses and other current assets                                                                                           |  |              | 52,657    |   |      |   | 49,994    |  
|                                                                                                                                    |  |              |           |   |      |   |           |  
|Total current assets                                                                                                                |  |              | 500,237   |   |      |   | 450,658   |  
|Property and equipment, net                                                                                                         |  |              | 94,631    |   |      |   | 103,531   |  
|Goodwill                                                                                                                            |  |              | 374,285   |   |      |   | 343,942   |  
|Acquired intangible assets, net                                                                                                     |  |              | 83,060    |   |      |   | 80,437    |  
|Long-term deferred income tax assets                                                                                                |  |              | 70,057    |   |      |   | 70,135    |  
|Other assets                                                                                                                        |  |              | 44,069    |   |      |   | 39,865    |  
|                                                                                                                                    |  |              |           |   |      |   |           |  
|Total assets                                                                                                                        |  | $            | 1,166,339 |   |      | $ | 1,088,568 |  
|                                                                                                                                    |  |              |           |   |      |   |           |  
|Liabilities and Stockholders Equity                                                                                                |  |              |           |   |      |   |           |  
|Current liabilities:                                                                                                                |  |              |           |   |      |   |           |  
|Accounts payable                                                                                                                    |  | $            | 18,350    |   |      | $ | 15,030    |  
|Accrued liabilities                                                                                                                 |  |              | 96,595    |   |      |   | 90,980    |  
|Accrued restructuring and excess facilities costs                                                                                   |  |              | 5,848     |   |      |   | 6,572     |  
|Deferred revenue                                                                                                                    |  |              | 159,241   |   |      |   | 140,221   |  
|Current portion of long-term debt                                                                                                   |  |              | 2,148     |   |      |   | 2,033     |  
|                                                                                                                                    |  |              |           |   |      |   |           |  
|Total current liabilities                                                                                                           |  |              | 282,182   |   |      |   | 254,836   |  
|Accrued excess facilities costs, less current portion                                                                               |  |              | 1,083     |   |      |   | 5,594     |  
|Long-term deferred revenue                                                                                                          |  |              | 15,353    |   |      |   | 12,007    |  
|Long-term deferred income tax liabilities                                                                                           |  |              | 9,257     |   |      |   | 15,329    |  
|Long-term income tax liabilities                                                                                                    |  |              | 17,045    |   |      |   | 12,439    |  
|Long-term debt, less current portion                                                                                                |  |              | 40,377    |   |      |   | 42,525    |  
|Other long-term liabilities                                                                                                         |  |              | 3,561     |   |      |   | 3,837     |  
|                                                                                                                                    |  |              |           |   |      |   |           |  
|Total liabilities                                                                                                                   |  |              | 368,858   |   |      |   | 346,567   |  
|                                                                                                                                    |  |              |           |   |      |   |           |  
|Commitments and contingencies                                                                                                       |  |              |           |   |      |   |           |  
|                                                                                                                                    |  |             
|Minority interest                                                                                                                   |  |              | 732       |   |      |   | 358       |  
|                                                                                                                                    |  |             
|Stockholders equity:                                                                                                               |  |              |           |   |      |   |           |  
|Common stock, $0.001 par value; 1,200,000 shares authorized; 167,738 shares and 174,296 shares issued and outstanding,
respectively |  |              | 168       |   |      |   | 174       |  
|Additional paid-in capital                                                                                                          |  |              | 774,474   |   |      |   | 761,743   |  
|Accumulated other comprehensive loss                                                                                                |  |              | (16,413   | ) |      |   | (44,425   | )
|Retained earnings                                                                                                                   |  |              | 38,520    |   |      |   | 24,151    |  
|                                                                                                                                    |  |              |           |   |      |   |           |  
|Total stockholders equity                                                                                                          |  |              | 796,749   |   |      |   | 741,643   |  
|                                                                                                                                    |  |              |           |   |      |   |           |  
|Total liabilities and stockholders equity                                                                                          |  | $            | 1,166,339 |   |      | $ | 1,088,568 |  
|                                                                                                                                    |  |              |           |   |      |   |           |  

See accompanying Notes to Consolidated Financial Statements



F-3



---

##### Table of Contents

TIBCO SOFTWARE INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)



|                                               |  |                         |          |   |      |   |         |      |  |   |         |  
|---------------------------------------------- |  | ----------------------- | -------- | - | ---- | - | ------- | ---- |  | - | ------- | -
|                                               |  | Year Ended November 30, |         
|                                               |  | 2009                    |          |   | 2008 |   |         | 2007 | 
|Revenue:                                       |  |                         |          |   |      |   |         |      |  |   |         |  
|License                                        |  |                         | $247,237 |   |      | $ | 273,415 |      |  | $ | 259,313 |  
|Service and maintenance                        |  |                         | 374,151  |   |      |   | 371,056 |      |  |   | 318,073 |  
|                                               |  |                         |          |   |      |   |         |      |  |   |         |  
|Total revenue                                  |  |                         | 621,388  |   |      |   | 644,471 |      |  |   | 577,386 |  
|                                               |  |                         |          |   |      |   |         |      |  |   |         |  
|Cost of revenue:                               |  |                         |          |   |      |   |         |      |  |   |         |  
|License                                        |  |                         | 28,252   |   |      |   | 30,276  |      |  |   | 24,024  |  
|Service and maintenance                        |  |                         | 130,800  |   |      |   | 147,622 |      |  |   | 134,877 |  
|                                               |  |                         |          |   |      |   |         |      |  |   |         |  
|Total cost of revenue                          |  |                         | 159,052  |   |      |   | 177,898 |      |  |   | 158,901 |  
|                                               |  |                         |          |   |      |   |         |      |  |   |         |  
|Gross profit                                   |  |                         | 462,336  |   |      |   | 466,573 |      |  |   | 418,485 |  
|Operating expenses:                            |  |                         |          |   |      |   |         |      |  |   |         |  
|Research and development                       |  |                         | 108,691  |   |      |   | 106,594 |      |  |   | 92,924  |  
|Sales and marketing                            |  |                         | 204,212  |   |      |   | 224,641 |      |  |   | 197,397 |  
|General and administrative                     |  |                         | 46,666   |   |      |   | 53,046  |      |  |   | 51,538  |  
|Amortization of acquired intangible assets     |  |                         | 14,165   |   |      |   | 16,557  |      |  |   | 13,164  |  
|Restructuring adjustment                       |  |                         |         |   |      |   |        |      |  |   | (1,095  | )
|Acquired in-process research and development   |  |                         |         |   |      |   |        |      |  |   | 1,600   |  
|                                               |  |                         |          |   |      |   |         |      |  |   |         |  
|Total operating expenses                       |  |                         | 373,734  |   |      |   | 400,838 |      |  |   | 355,528 |  
|                                               |  |                         |          |   |      |   |         |      |  |   |         |  
|Income from operations                         |  |                         | 88,602   |   |      |   | 65,735  |      |  |   | 62,957  |  
|Interest income                                |  |                         | 2,265    |   |      |   | 9,115   |      |  |   | 18,447  |  
|Interest expense                               |  |                         | (2,968   | ) |      |   | (3,238  | )    |  |   | (2,824  | )
|Other income (expense), net                    |  |                         | 1,718    |   |      |   | (782    | )    |  |   | (1,181  | )
|                                               |  |                         |          |   |      |   |         |      |  |   |         |  
|Income before provision for income taxes       |  |                         | 89,617   |   |      |   | 70,830  |      |  |   | 77,399  |  
|Provision for income taxes                     |  |                         | 27,097   |   |      |   | 18,314  |      |  |   | 25,401  |  
|Minority interest, net of tax                  |  |                         | 218      |   |      |   | 105     |      |  |   | 110     |  
|                                               |  |                         |          |   |      |   |         |      |  |   |         |  
|Net income                                     |  | $                       | 62,302   |   |      | $ | 52,411  |      |  | $ | 51,888  |  
|                                               |  |                         |          |   |      |   |         |      |  |   |         |  
|Net income per share:                          |  |                         |          |   |      |   |         |      |  |   |         |  
|Basic                                          |  | $                       | 0.37     |   |      | $ | 0.29    |      |  | $ | 0.26    |  
|                                               |  |                         |          |   |      |   |         |      |  |   |         |  
|Diluted                                        |  | $                       | 0.36     |   |      | $ | 0.29    |      |  | $ | 0.25    |  
|                                               |  |                         |          |   |      |   |         |      |  |   |         |  
|Shares used in computing net income per share: |  |                         |          |   |      |   |         |      |  |   |         |  
|Basic                                          |  |                         | 168,970  |   |      |   | 180,525 |      |  |   | 198,885 |  
|                                               |  |                         |          |   |      |   |         |      |  |   |         |  
|Diluted                                        |  |                         | 172,328  |   |      |   | 183,742 |      |  |   | 205,316 |  
|                                               |  |                         |          |   |      |   |         |      |  |   |         |  



See accompanying
Notes to Consolidated Financial Statements



F-4



---

##### Table of Contents

TIBCO SOFTWARE INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY AND COMPREHENSIVE INCOME (LOSS)

(In thousands)



|                                                                     |  |              |   |  |                          |     |   |                                            |   |          |                  |  |   |                          |   |  |   |         |   |  |   |          |  
|-------------------------------------------------------------------- |  | ------------ | - |  | ------------------------ | --- | - | ------------------------------------------ | - | -------- | ---------------- |  | - | ------------------------ | - |  | - | ------- | - |  | - | -------- | -
|                                                                     |  | Common Stock |   |  | AdditionalPaid-inCapital |     |   | AccumulatedOtherComprehensiveIncome (Loss) |   |          | RetainedEarnings |  |   | TotalStockholdersEquity |  
|                                                                     |  | Shares       |   |  | Amount                   |     |   |                                            |   |         
|Balances, November 30, 2006                                          |  | 211,208      |   |  | $                        | 211 |   |                                            | $ | 909,289  |                  |  | $ | 10,809                   |   |  | $ | 25,698  |   |  | $ | 946,007  |  
|Components of comprehensive income:                                  |  |              |   |  |                          |     |   |                                            |   |          |                  |  |   |                          |   |  |   |         |   |  |   |          |  
|Net income                                                           |  |             |   |  |                          |    |   |                                            |   |         |                  |  |   |                         |   |  |   | 51,888  |   |  |   | 51,888   |  
|Foreign currency translation adjustment, net of $(3,904) tax effects |  |             |   |  |                          |    |   |                                            |   |         |                  |  |   | 21,514                   |   |  |   |        |   |  |   | 21,514   |  
|Unrealized gain on investments, no tax                               |  |             |   |  |                          |    |   |                                            |   |         |                  |  |   | 670                      |   |  |   |        |   |  |   | 670      |  
|                                                                     |  |              |   |  |                          |     |   |                                            |   |          |                  |  |   |                          |   |  |   |         |   |  |   |          |  
|Comprehensive income                                                 |  |              |   |  |                          |     |   |                                            |   |          |                  |  |   |                          |   |  |   |         |   |  |   | 74,072   |  
|                                                                     |  |              |   |  |                          |     |   |                                            |   |          |                  |  |   |                          |   |  |   |         |   |  |   |          |  
|Common stock repurchased and retired                                 |  | (25,575      | ) |  |                          | (25 | ) |                                            |   | (176,965 | )                |  |   |                         |   |  |   | (49,942 | ) |  |   | (226,932 | )
|Common stock options exercised                                       |  | 3,995        |   |  |                          | 4   |   |                                            |   | 22,763   |                  |  |   |                         |   |  |   |        |   |  |   | 22,767   |  
|Common stock issued for employee stock purchase program              |  | 398          |   |  |                          |    |   |                                            |   | 2,945    |                  |  |   |                         |   |  |   |        |   |  |   | 2,945    |  
|Tax benefits from employee stock option plans                        |  |             |   |  |                          |    |   |                                            |   | 19,456   |                  |  |   |                         |   |  |   |        |   |  |   | 19,456   |  
|Stock-based compensation, net                                        |  |             |   |  |                          |    |   |                                            |   | 17,563   |                  |  |   |                         |   |  |   |        |   |  |   | 17,563   |  
|Substitute options fair value adjustment in acquisition              |  |             |   |  |                          |    |   |                                            |   | 187      |                  |  |   |                         |   |  |   |        |   |  |   | 187      |  
|Restricted stock withholding taxes net-settlement                    |  | (85          | ) |  |                          |    |   |                                            |   | (669     | )                |  |   |                         |   |  |   |        |   |  |   | (669     | )
|Restricted stock awards                                              |  | 1,209        |   |  |                          |    |   |                                            |   | (1       | )                |  |   |                         |   |  |   |        |   |  |   |         |  
|                                                                     |  |              |   |  |                          |     |   |                                            |   |          |                  |  |   |                          |   |  |   |         |   |  |   |          |  
|Balances, November 30, 2007                                          |  | 191,150      |   |  |                          | 191 |   |                                            |   | 794,568  |                  |  |   | 32,993                   |   |  |   | 27,644  |   |  |   | 855,396  |  
|Components of comprehensive income:                                  |  |              |   |  |                          |     |   |                                            |   |          |                  |  |   |                          |   |  |   |         |   |  |   |          |  
|Net income                                                           |  |             |   |  |                          |    |   |                                            |   |         |                  |  |   |                         |   |  |   | 52,411  |   |  |   | 52,411   |  
|Foreign currency translation adjustment, net of $19,604 tax effects  |  |             |   |  |                          |    |   |                                            |   |         |                  |  |   | (77,087                  | ) |  |   |        |   |  |   | (77,087  | )
|Unrealized loss on investments, no tax                               |  |             |   |  |                          |    |   |                                            |   |         |                  |  |   | (331                     | ) |  |   |        |   |  |   | (331     | )
|                                                                     |  |              |   |  |                          |     |   |                                            |   |          |                  |  |   |                          |   |  |   |         |   |  |   |          |  
|Comprehensive loss                                                   |  |              |   |  |                          |     |   |                                            |   |          |                  |  |   |                          |   |  |   |         |   |  |   | (25,007  | )
|                                                                     |  |              |   |  |                          |     |   |                                            |   |          |                  |  |   |                          |   |  |   |         |   |  |   |          |  
|Cumulative effect of change in accounting principle                  |  |             |   |  |                          |    |   |                                            |   |         |                  |  |   |                         |   |  |   | 605     |   |  |   | 605      |  
|Common stock repurchased and retired                                 |  | (21,271      | ) |  |                          | (21 | ) |                                            |   | (92,459  | )                |  |   |                         |   |  |   | (56,509 | ) |  |   | (148,989 | )
|Common stock options exercised                                       |  | 2,059        |   |  |                          | 2   |   |                                            |   | 8,610    |                  |  |   |                         |   |  |   |        |   |  |   | 8,612    |  
|Common stock issued for employee stock purchase program              |  | 546          |   |  |                          |    |   |                                            |   | 3,555    |                  |  |   |                         |   |  |   |        |   |  |   | 3,555    |  
|Tax benefits from employee stock option plans                        |  |             |   |  |                          |    |   |                                            |   | 27,025   |                  |  |   |                         |   |  |   |        |   |  |   | 27,025   |  
|Stock-based compensation, net                                        |  |             |   |  |                          |    |   |                                            |   | 20,972   |                  |  |   |                         |   |  |   |        |   |  |   | 20,972   |  
|Stock options assumed during the acquisition                         |  |             |   |  |                          |    |   |                                            |   | 1,011    |                  |  |   |                         |   |  |   |        |   |  |   | 1,011    |  
|Restricted stock withholding taxes net-settlement                    |  | (185         | ) |  |                          |    |   |                                            |   | (1,537   | )                |  |   |                         |   |  |   |        |   |  |   | (1,537   | )
|Restricted stock awards                                              |  | 1,997        |   |  |                          | 2   |   |                                            |   | (2       | )                |  |   |                         |   |  |   |        |   |  |   |         |  
|                                                                     |  |              |   |  |                          |     |   |                                            |   |          |                  |  |   |                          |   |  |   |         |   |  |   |          |  
|Balances, November 30, 2008                                          |  | 174,296      |   |  |                          | 174 |   |                                            |   | 761,743  |                  |  |   | (44,425                  | ) |  |   | 24,151  |   |  |   | 741,643  |  
|Components of comprehensive income:                                  |  |              |   |  |                          |     |   |                                            |   |          |                  |  |   |                          |   |  |   |         |   |  |   |          |  
|Net income                                                           |  |             |   |  |                          |    |   |                                            |   |         |                  |  |   |                         |   |  |   | 62,302  |   |  |   | 62,302   |  
|Foreign currency translation adjustment, net of $(3,119) tax effects |  |             |   |  |                          |    |   |                                            |   |         |                  |  |   | 28,065                   |   |  |   |        |   |  |   | 28,065   |  
|Unrealized loss on investments, no tax                               |  |             |   |  |                          |    |   |                                            |   |         |                  |  |   | (53                      | ) |  |   |        |   |  |   | (53      | )
|                                                                     |  |              |   |  |                          |     |   |                                            |   |          |                  |  |   |                          |   |  |   |         |   |  |   |          |  
|Comprehensive income                                                 |  |              |   |  |                          |     |   |                                            |   |          |                  |  |   |                          |   |  |   |         |   |  |   | 90,314   |  
|                                                                     |  |              |   |  |                          |     |   |                                            |   |          |                  |  |   |                          |   |  |   |         |   |  |   |          |  
|Common stock repurchased and retired                                 |  | (12,928      | ) |  |                          | (13 | ) |                                            |   | (58,501  | )                |  |   |                         |   |  |   | (47,933 | ) |  |   | (106,447 | )
|Common stock options exercised                                       |  | 4,290        |   |  |                          | 4   |   |                                            |   | 25,974   |                  |  |   |                         |   |  |   |        |   |  |   | 25,978   |  
|Common stock issued for employee stock purchase program              |  | 520          |   |  |                          | 1   |   |                                            |   | 2,424    |                  |  |   |                         |   |  |   |        |   |  |   | 2,425    |  
|Tax benefits from employee stock option plans                        |  |             |   |  |                          |    |   |                                            |   | 21,573   |                  |  |   |                         |   |  |   |        |   |  |   | 21,573   |  
|Stock-based compensation, net                                        |  |             |   |  |                          |    |   |                                            |   | 23,546   |                  |  |   |                         |   |  |   |        |   |  |   | 23,546   |  
|Restricted stock withholding taxes net-settlement                    |  | (318         | ) |  |                          |    |   |                                            |   | (2,283   | )                |  |   |                         |   |  |   |        |   |  |   | (2,283   | )
|Restricted stock awards                                              |  | 1,878        |   |  |                          | 2   |   |                                            |   | (2       | )                |  |   |                         |   |  |   |        |   |  |   |         |  
|                                                                     |  |              |   |  |                          |     |   |                                            |   |          |                  |  |   |                          |   |  |   |         |   |  |   |          |  
|Balances, November 30, 2009                                          |  | 167,738      |   |  | $                        | 168 |   |                                            | $ | 774,474  |                  |  | $ | (16,413                  | ) |  | $ | 38,520  |   |  | $ | 796,749  |  
|                                                                     |  |              |   |  |                          |     |   |                                            |   |          |                  |  |   |                          |   |  |   |         |   |  |   |          |  

See accompanying Notes to Consolidated Financial Statements



F-5



---

##### Table of Contents

TIBCO SOFTWARE INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)



|                                                                                  |  |                         |          |   |      |   |          |      |  |   |          |  
|--------------------------------------------------------------------------------- |  | ----------------------- | -------- | - | ---- | - | -------- | ---- |  | - | -------- | -
|                                                                                  |  | Year Ended November 30, |         
|                                                                                  |  | 2009                    |          |   | 2008 |   |          | 2007 | 
|Operating activities:                                                             |  |                         |          |   |      |   |          |      |  |   |          |  
|Net income                                                                        |  | $                       | 62,302   |   |      | $ | 52,411   |      |  | $ | 51,888   |  
|Adjustments to reconcile net income to net cash provided by operating activities: |  |                         |          |   |      |   |          |      |  |   |          |  
|Depreciation of property and equipment                                            |  |                         | 15,107   |   |      |   | 15,814   |      |  |   | 16,167   |  
|Amortization of acquired intangible assets                                        |  |                         | 27,628   |   |      |   | 32,302   |      |  |   | 23,490   |  
|Stock-based compensation                                                          |  |                         | 23,546   |   |      |   | 20,972   |      |  |   | 17,563   |  
|Acquired in-process research and development                                      |  |                         |         |   |      |   |         |      |  |   | 1,600    |  
|Deferred income tax                                                               |  |                         | (12,630  | ) |      |   | (26,194  | )    |  |   | (6,077   | )
|Tax benefits related to employee stock option plans                               |  |                         | 21,573   |   |      |   | 27,025   |      |  |   | 19,456   |  
|Excess tax benefits from stock-based compensation                                 |  |                         | (17,016  | ) |      |   | (24,713  | )    |  |   | (17,980  | )
|Minority interest, net of tax                                                     |  |                         | 218      |   |      |   | 105      |      |  |   | 110      |  
|Other non-cash adjustments, net                                                   |  |                         | 1,207    |   |      |   | 991      |      |  |   | (1,506   | )
|Changes in assets and liabilities, net of effects of acquisitions:                |  |                         |          |   |      |   |          |      |  |   |          |  
|Accounts receivable                                                               |  |                         | (20,896  | ) |      |   | 20,683   |      |  |   | (5,459   | )
|Prepaid expenses and other assets                                                 |  |                         | 7,465    |   |      |   | 9,060    |      |  |   | (4,778   | )
|Accounts payable                                                                  |  |                         | 2,300    |   |      |   | 3,531    |      |  |   | (885     | )
|Accrued liabilities and excess facilities costs                                   |  |                         | (7,735   | ) |      |   | 12,528   |      |  |   | (8,613   | )
|Deferred revenue                                                                  |  |                         | 12,328   |   |      |   | 7,977    |      |  |   | 17,304   |  
|                                                                                  |  |                         |          |   |      |   |          |      |  |   |          |  
|Net cash provided by operating activities                                         |  |                         | 115,397  |   |      |   | 152,492  |      |  |   | 102,280  |  
|                                                                                  |  |                         |          |   |      |   |          |      |  |   |          |  
|Investing activities:                                                             |  |                         |          |   |      |   |          |      |  |   |          |  
|Purchases of short-term investments                                               |  |                         |         |   |      |   | (37,047  | )    |  |   | (140,928 | )
|Maturities and sales of short-term investments                                    |  |                         | 12,448   |   |      |   | 124,032  |      |  |   | 450,311  |  
|Acquisitions, net of cash acquired                                                |  |                         | (27,340  | ) |      |   | (20,098  | )    |  |   | (182,912 | )
|Purchases of private equity investments                                           |  |                         |         |   |      |   | (38      | )    |  |   | (63      | )
|Proceeds from sales of private equity investments                                 |  |                         | 117      |   |      |   | 347      |      |  |   | 803      |  
|Purchases of property and equipment                                               |  |                         | (5,388   | ) |      |   | (8,937   | )    |  |   | (12,599  | )
|Restricted cash pledged as security                                               |  |                         | (2,571   | ) |      |   | 652      |      |  |   | 368      |  
|                                                                                  |  |                         |          |   |      |   |          |      |  |   |          |  
|Net cash provided by (used in) investing activities                               |  |                         | (22,734  | ) |      |   | 58,911   |      |  |   | 114,980  |  
|                                                                                  |  |                         |          |   |      |   |          |      |  |   |          |  
|Financing activities:                                                             |  |                         |          |   |      |   |          |      |  |   |          |  
|Proceeds from issuance of common stock                                            |  |                         | 28,403   |   |      |   | 12,167   |      |  |   | 25,712   |  
|Repurchases of the Companys common stock                                         |  |                         | (106,447 | ) |      |   | (148,989 | )    |  |   | (226,932 | )
|Withholding taxes related to restricted stock net share settlement                |  |                         | (2,283   | ) |      |   | (1,537   | )    |  |   | (669     | )
|Excess tax benefits from stock-based compensation                                 |  |                         | 17,016   |   |      |   | 24,713   |      |  |   | 17,980   |  
|Principal payments on long-term debt                                              |  |                         | (2,033   | ) |      |   | (1,924   | )    |  |   | (6,277   | )
|Payment of issuance costs on line of credit                                       |  |                         | (2,317   | ) |      |   |         |      |  |   |         |  
|Proceeds from minority investors                                                  |  |                         |         |   |      |   |         |      |  |   | 189      |  
|                                                                                  |  |                         |          |   |      |   |          |      |  |   |          |  
|Net cash used in financing activities                                             |  |                         | (67,661  | ) |      |   | (115,570 | )    |  |   | (189,997 | )
|                                                                                  |  |                         |          |   |      |   |          |      |  |   |          |  
|Effect of foreign exchange rate changes on cash and cash equivalents              |  |                         | 13,127   |   |      |   | (11,670  | )    |  |   | 4,062    |  
|Net increase in cash and cash equivalents                                         |  |                         | 38,129   |   |      |   | 84,163   |      |  |   | 31,325   |  
|Cash and cash equivalents at beginning of year                                    |  |                         | 254,400  |   |      |   | 170,237  |      |  |   | 138,912  |  
|                                                                                  |  |                         |          |   |      |   |          |      |  |   |          |  
|Cash and cash equivalents at end of year                                          |  | $                       | 292,529  |   |      | $ | 254,400  |      |  | $ | 170,237  |  
|                                                                                  |  |                         |          |   |      |   |          |      |  |   |          |  
|Supplemental disclosures:                                                         |  |                         |          |   |      |   |          |      |  |   |          |  
|Interest paid                                                                     |  | $                       | 2,400    |   |      | $ | 2,508    |      |  | $ | 2,489    |  
|                                                                                  |  |                         |          |   |      |   |          |      |  |   |          |  
|Income taxes paid                                                                 |  | $                       | 18,573   |   |      | $ | 12,604   |      |  | $ | 12,098   |  
|                                                                                  |  |                         |          |   |      |   |          |      |  |   |          |  
|Supplemental disclosures of non-cash investing and financing activities:          |  |                         |          |   |      |   |          |      |  |   |          |  
|Non-cash contributions from minority investors                                    |  | $                       |         |   |      | $ |         |      |  | $ | 85       |  
|                                                                                  |  |                         |          |   |      |   |          |      |  |   |          |  

See accompanying Notes to Consolidated Financial Statements



F-6



---

##### Table of Contents

TIBCO SOFTWARE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.    Business

TIBCO Software Inc.
(TIBCO, the Company, we or us), a Delaware corporation, is a leading independent provider of infrastructure software. Our standards-based software offerings enable customers to create flexible,
configurable applications from software infrastructure and deliver real-time insights. Our solutions help customers extend the life of past investments made, operate their business more efficiently, and better capitalize on opportunities to increase
revenue and market share. Using our software, customers have the information they need to constantly innovate and make faster and smarter decisions, what we call The Power of Now®.

2.    Summary of Significant
Accounting Policies

Principles of Consolidation

The Consolidated Financial Statements include the accounts of TIBCO and our wholly-owned and majority-owned subsidiaries. All significant
intercompany accounts and transactions have been eliminated in consolidation. For majority-owned subsidiaries, we reflect the minority interest of the portion we do not own on our Consolidated Balance Sheets between Total Liabilities and
Stockholders Equity.

Fiscal Years

Our fiscal year is a twelve month period ending on November 30 of a stated year. For the purpose of presentation, we also refer to the fiscal years ended November 30, 2009, 2008 and 2007, as our
fiscal years 2009, 2008 and 2007, respectively.

We evaluated all subsequent events that occurred after the balance sheet date
and through the date and time our financial statements were issued on January 29, 2010.

Use of Estimates

The preparation of the Consolidated Financial Statements in conformity with generally accepted accounting principles in the United States of
America (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported
amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Revenue Recognition

License revenue consists principally of revenue earned under software license agreements. License revenue is generally
recognized when a signed contract or other persuasive evidence of an arrangement exists, the software has been shipped or electronically delivered, the license fee is fixed or determinable and collection of the resulting receivable is probable. When
contracts contain multiple elements wherein Vendor-Specific Objective Evidence (VSOE) exists for all undelivered elements, we account for the delivered elements in accordance with the Residual Method. VSOE of fair value for
maintenance and support is established by a stated renewal rate included in the license arrangement or rates charged in stand-alone sales of maintenance and support. Revenue from subscription license agreements, which include software, rights to
unspecified future products and maintenance, is recognized ratably over the term of the subscription period.

Provided all
other revenue criteria are met, the upfront, minimum, non-refundable license fees from OEM customers are generally recognized upon delivery and on-going royalty fees are generally recognized upon



F-7



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



reports of units shipped. Revenue on shipments to resellers is recognized when evidence of an end user arrangement exists and recorded net of related costs to the resellers.

Professional services revenue consists primarily of revenue received for assisting with the implementation of our software, on-site support,
training and other consulting services. Many customers who license our software also enter into separate professional services arrangements with us. In determining whether professional services revenue should be accounted for separately from license
revenue, we evaluate, among other factors: the nature of our software products; whether they are ready for use by the customer upon receipt; the nature of our implementation services, which typically do not involve significant customization to or
development of the underlying software code; the availability of services from other vendors; whether the timing of payments for license revenue is coincident with performance of services; and whether milestones or acceptance criteria exist that
affect the realizability of the software license fee. Substantially all of our professional services arrangements are billed on a time and materials basis and, accordingly, are recognized as the services are performed. Contracts with fixed or
not-to-exceed fees are recognized on a percentage-of-completion or completed-contract basis. If there is significant uncertainty about the project completion or receipt of payment for professional services, revenue is deferred until the uncertainty
is sufficiently resolved. Training revenue is recognized as training services are delivered. VSOE of fair value of consulting and training services is based upon stand-alone sales of those services. Payments received in advance of consulting or
training services performed are deferred and recognized when the related services are performed. Our service and maintenance revenue includes reimbursable expenses of $8.1 million, $9.2 million and $7.6 million in fiscal years 2009, 2008 and 2007,
respectively.

For arrangements that do not qualify for separate accounting for the license and professional services
revenues, including arrangements that involve significant modification or customization of the software, that include milestones or customer specific acceptance criteria that may affect collection of the software license fees, or where payment for
the software license is tied to the performance of professional services, software license revenue is generally recognized together with the professional services revenue using either the percentage-of-completion or completed-contract method. The
completed contract method is used for contracts where there is a risk over final acceptance by the customer or for contracts that are short term in nature. Under the percentage-of-completion method, revenue recognized is equal to the ratio of costs
expended to date to the anticipated total contract costs, based on current estimates of costs to complete the project. If there are milestones or acceptance provisions associated with the contract, the revenue recognized will not exceed the most
recent milestone achieved or acceptance obtained. If the total estimated costs to complete a project exceed the total contract amount, indicating a loss, the entire anticipated loss would be recognized currently.

Maintenance revenue consists of fees for providing software updates on a when and if available basis and technical support for software
products (post-contract customer support or PCS). Maintenance revenue is recognized ratably over the term of the agreement.

Payments received in advance of services performed are deferred. Allowances for estimated future returns and discounts are provided for upon recognition of revenue.

Fair Value of Financial Instruments

Carrying amounts of our financial instruments including accounts receivable, accounts payable and accrued liabilities approximate fair value due to their short maturities. The fair values of our cash
equivalents, available-for-sale investments in marketable securities and derivative instruments are detailed further in Note 5.



F-8



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



Concentration of Credit Risk

Our cash, cash equivalents, short-term investments and accounts receivable are potentially subject to concentration of credit risk. Cash,
cash equivalents and investments are deposited with financial institutions that management believes are creditworthy. We perform ongoing credit evaluations of our customers financial condition and, generally, require no collateral from our
customers. We maintain an allowance for doubtful accounts receivable based on various factors, including our review of credit profiles of our customers, contractual terms and conditions, current economic trends and historical payment experience; see
Note 6 for further details.

No customer accounted for more than 10% of total revenue in fiscal years 2009, 2008 or 2007. No
customer had a balance in excess of 10% of our net accounts receivable as of November 30, 2009 or 2008.

Cash, Cash Equivalents,
and Short-Term Investments

We consider all highly liquid investment securities with remaining maturities at the date
of purchase of three months or less to be cash equivalents. Management determines the appropriate classification of marketable securities at the time of purchase and evaluates such designation as of each balance sheet date. To date, all marketable
securities have been classified as available-for-sale and are carried at fair value with unrealized gains and losses, if any, included as a component of Accumulated Other Comprehensive Income (Loss) in Stockholders Equity. These
available-for-sale investments are presented as Current Assets as they are subject to use within one year in current operations. Interest, dividends, realized gains and losses and impairment losses are included in Interest Income and Other Income
(Expense). Realized gains and losses and impairment losses are recognized based on the specific identification method.

Valuation and
Impairment of Short-Term Investments

We monitor our investment portfolio for impairment on a periodic basis. In the
event that the carrying value of an investment exceeds its fair value and the decline in value is determined to be other-than-temporary, an impairment charge is recorded and a new cost basis for the investment is established. An other-than-temporary
impairment is triggered in circumstances where (i) we have an intent to sell the security, (ii) it is more likely than not that we will be required to sell the security before recovery of its amortized cost basis, or (iii) we do not
expect to recover the entire amortized cost basis of the security (that is, a credit loss exists). If we intend to sell the security or is more likely than not that we will be required to sell the security before recovery of its amortized cost
basis, the other-than-temporary impairment is recognized in earnings equal to the entire difference between the securitys amortized cost basis and its fair value. If a credit loss exists for a debt security but we do not intend to sell the
security and it is more likely than not that it will be required to sell the security before recovery of its remaining amortized cost basis (amortized cost basis less any current-period credit loss), the other-than-temporary impairment is separated
into an amount representing the credit loss, which is recognized in earnings, and the amount related to all other factors, which is recognized in other comprehensive income (loss).

Other Investments

We have an investment in a private investment LLC
which invests in privately held companies. This investment is carried at cost basis and is included in Other Assets on the Balance Sheets. The fair value of the funds investments is dependent on the performance of the companies in which the
fund is invested, as well as the volatility inherent in external markets for these companies. If we believe that an other-than-temporary decline exists, we would record the related write-down as a loss on investments in our Consolidated Statements
of Operations. The carrying value of this investment is $0.8 million as of November 30, 2009 and 2008, respectively; representing approximately 1% ownership of the LLC. We believe the estimated fair value of the



F-9



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



investment is approximately $1.5 million as of November 30, 2009. The fair value is derived according to the fair value guidance and the factors include the most recent financial statements
published by the LLC. No impairment losses associated with our minority equity investment were incurred in the periods presented.

Property and Equipment

Property and equipment are stated at cost, net of accumulated depreciation.
These assets are depreciated using the straight-line method over their estimated useful lives as follows:



|                       |  |                                                       
|---------------------- |  | ------------------------------------------------------
|Buildings              |  | 25 years                                              
|Equipment and software |  | 2  5 years                                           
|Furniture and fixtures |  | 5 years                                               
|Leasehold improvements |  | Shorter of the lease term or the estimated useful life

Depreciation expense for property and equipment was $15.1 million, $15.8 million and
$16.2 million in fiscal years 2009, 2008 and 2007, respectively.

Goodwill

Goodwill and intangible assets with indefinite useful lives are not amortized, but are tested for impairment at least annually or as
circumstances indicate that their value may no longer be recoverable. We do not have intangible assets with indefinite useful lives other than goodwill. Goodwill impairment testing is a two-step process: first, we screen for impairment, and if any
possible impairment exists, we then undertake a second step of measuring such impairment. We generally perform our goodwill impairment test annually in our fourth fiscal quarter, and the last impairment test was completed for the fiscal year ended
November 30, 2009. The guidance for goodwill and other intangible assets requires impairment testing based on reporting units. We periodically re-evaluate our business and have determined that we continue to operate in one segment, which we
consider our sole reporting unit. Therefore, goodwill was tested and will continue to be tested for impairment at the enterprise level. To date, we have determined that there has been no impairment of goodwill.

The results of step one of our annual goodwill impairment test for November 30, 2009 and 2008 are as follows:



|                                         |  |              |           |      |   |        
|---------------------------------------- |  | ------------ | --------- | ---- | - | -------
|                                         |  | November 30,
|                                         |  | 2009         |           | 2008
|Market capitalization (NASDAQ)           |  | $            | 1,442,548 |      | $ | 843,591
|Stockholders equity (carrying amount) |  |              | 796,749   |      |   | 741,643
|                                         |  |              |           |      |   |        
|                                         |  | $            | 645,799   |      | $ | 101,948
|                                         |  |              |           |      |   |        

Impairment of Long-Lived Assets

We evaluate the recoverability of our long-lived assets which includes amortizable intangible and tangible assets in accordance with
authoritative guidance on accounting for the impairment or disposal of long-lived assets. Acquired intangible assets with definite useful lives are amortized over their useful lives. We evaluate long-lived assets, other than goodwill, for impairment
whenever events or changes in circumstances indicate that the carrying value of these assets may not be recoverable. We recognize such impairment in the event the net book value of such assets exceeds their fair value. No long-lived assets
impairment losses were incurred in the fiscal years presented.



F-10



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



Restructuring and Integration Costs

Our restructuring charges are comprised primarily of costs related to properties abandoned in connection with facilities consolidation,
related write-downs of leasehold improvements, and employee termination costs related to headcount reductions. A liability for costs associated with an exit or disposal activity is recognized and measured initially at fair value only when the
liability is incurred. Our restructuring charges include accruals for estimated losses related to our excess facilities, based on our contractual obligations, net of estimated sublease income. We reassess this liability periodically based on market
conditions.

Stock-Based Compensation

We utilize the Black-Scholes option pricing model as the most appropriate method for determining the estimated fair value of our share-based awards. The Black-Scholes model requires the use of highly
subjective and complex assumptions which determine the fair value of share-based awards, including the options expected term and the price volatility of the underlying stock. We determined that a blend of implied volatility and historical
volatility is more reflective of the market conditions and a better indicator of expected volatility than historical volatility alone. The fair value of the awards that are ultimately expected to vest is recognized over the requisite service periods
on a straight-line basis in our Consolidated Statements of Operations. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates.

We utilize the long form method of calculating the tax effects of share-based compensation. Under the long form
method, we determined the beginning balance of the additional paid-in capital pool (APIC pool) related to the tax effects of the employee share-based compensation as if we had adopted the recognition provisions of share-based
payment since its effective date of January 1, 1995. We also determined the subsequent impact on the APIC pool and Consolidated Statement of Cash Flows of the tax effect of employee sharebased compensation awards that were issued after
the adoption of the share-based payment guidance and outstanding at the adoption date.

Consistent with prior years, we use
the with and without approach in determining the order in which our tax attributes are utilized. The with and without approach results in the recognition of the windfall stock option tax benefits only after all other tax
attributes, except for pre-acquisition tax attributes of acquired entities, have been considered in the annual tax accrual computation. Also consistent with prior years, we consider the indirect effects of the windfall deduction on the computation
of other tax attributes, such as the R&D credit deduction, as an additional component of equity. This incremental tax effect is recorded to additional paid in capital when realized.

Income Taxes

We make certain estimates and judgments in determining
income tax expense for financial statement purposes. These estimates and judgments occur in the calculation of certain tax assets and liabilities, which arise from differences in the timing of recognition of revenue and expense for tax and financial
statement purposes.

We assess the likelihood that we will be able to recover our deferred tax assets. We consider all
available evidence, both positive and negative, including historical levels of income, expectations and risks associated with estimates of future taxable income and ongoing prudent and feasible tax planning strategies in assessing the need for the
valuation allowance. If it is not more likely than not that we will recover our deferred tax assets, we will increase our provision for taxes by recording a valuation allowance against the deferred tax assets that we estimate will not ultimately be
recoverable.



F-11



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



Foreign Currency

Our foreign subsidiaries use the local currency of their respective countries as their functional currency with the exception of Cayman
Islands, Cyprus, and Ireland. Assets and liabilities of these subsidiaries are translated into U.S. dollars at exchange rates at the balance sheet date. Income and expense items are translated at average exchange rates for the
period. Cumulative translation adjustments are included as a component of Accumulated Other Comprehensive Income (Loss) in Stockholders Equity. Foreign currency exchange gains and losses, derived from monetary assets and liabilities
stated in a currency other than the functional currency, are recorded in the Consolidated Statements of Operations. We recorded foreign currency exchange gains and (losses) of $1.7 million, $(1.1) million and $(1.5) million in fiscal years 2009,
2008 and 2007, respectively, in Other Income (Expense) in our Consolidated Statements of Operations.

Foreign Currency Forward Contracts

Foreign currency foreign contracts are recognized as assets or liabilities in the statement of financial position and
measured at fair value. These contracts are adjusted to fair value through earnings.

To manage currency exposure related to
net assets and liabilities denominated in foreign currencies, we enter into forward contracts for certain foreign denominated assets or liabilities. We do not enter into derivative financial instruments for trading purposes. We had six outstanding
forward contracts with a total notional amount of $65.2 million as of November 30, 2009. These derivative instruments are not designed for hedge accounting and are adjusted to fair value through Other Income (Expense) under the Consolidated
Statements of Operations. The gain on fair value of these forward contracts as of November 30, 2009 was approximately $0.4 million.

The gains and losses on these derivative instruments are intended to offset the impact of foreign exchange rate changes on the underlying foreign currency denominated assets and liabilities subject to
remeasurement and transaction exposures, and therefore, these forward contracts do not subject us to material balance sheet risk. As of November 30, 2009, the outstanding balance sheet foreign currency forward contracts had maturities of
approximately 30 days.

Capitalized Software Development Costs

Capitalization of material software development costs begins when a products technological feasibility has been established. We define
technological feasibility as the establishment of a working model, which typically occurs when beta testing commences. To date, the period between achieving technological feasibility and the general availability of our software products has been
very short. Accordingly, software development costs have been expensed as incurred.

Costs related to software acquired,
developed or modified solely to meet our internal requirements, with no substantive plans to market such software at the time of development, are capitalized. Costs incurred during the preliminary planning and evaluation stage of the project and
during post implementation operational stage are expensed as incurred. Costs incurred during the application development stage of the project are capitalized. Costs of the computer software developed or obtained for internal use are included in
Property and Equipment on the Consolidated Balance Sheets, and are depreciated on a straight line basis over the useful life of the software.

Advertising Expense

Advertising costs are expensed as incurred and totaled approximately $2.7 million,
$2.7 million and $1.1 million in fiscal years 2009, 2008 and 2007, respectively.



F-12



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



Recent Accounting Pronouncements

In June 2009, Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards (SFAS),
The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles(SFAS No. 168). SFAS No. 168 replaces the GAAP hierarchy with two levels: authoritative and nonauthoritative. The
FASB Accounting Standards Codification (Codification) became the single source of authoritative nongovernmental GAAP, except for rules and interpretive releases of the Securities and Exchange Commission (SEC). The
Codification supersedes all existing non-SEC accounting and reporting standards. All other nongrandfathered, non-SEC accounting literature not included in the Codification will become nonauthoritative.

Following the Codification, FASB will no longer issue new standards in the form of Statements, FASB Staff Positions or Emerging Issues Task
Force Abstracts. Instead it will issue Accounting Standards Updates (ASU), which will serve to update the Codification, provide background information about the guidance and provide the basis for conclusions on changes to the
Codification.

GAAP is not intended to be changed as a result of the FASBs Codification project, but it will change the
way guidance is organized and presented. TIBCO has adopted the provisions of this guidance and as a result it will only affect the specific references to GAAP literature in the notes to our consolidated financial statements.

In September 2009, the FASB issued authoritative guidance that provides guidance on determining multiple elements in an arrangement and how
total consideration should be allocated amongst the elements. It also expands disclosure requirements for multiple element arrangements. Concurrently, the FASB also issued authoritative guidance for arrangements that include both software and
tangible products that excludes tangible products and certain related elements from the scope of the revenue recognition authoritative guidance specific to software transactions. The standards must both be adopted in the same period and can be
applied on a prospective basis for revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010, with earlier application permitted, or they can be adopted on a retrospective basis. We are
currently evaluating the potential impact, if any, of the adoption of the guidance on our consolidated results of operations and financial condition.

In November 2008, the FASB issued a new accounting standard related to defensive intangible assets. Defensive intangible assets are acquired intangible assets that the acquirer does not intend to actively
use but intends to hold to prevent its competitors from obtaining access to them. Under the new standard, defensive intangible assets must be initially recognized at fair value and amortized over the benefit period. We will adopt this new accounting
standard in the first quarter of fiscal 2010. The impact of adoption will be largely dependent on the size and nature of business combinations completed after the date of adoption. We are currently evaluating the potential impact, if any, of the
adoption of the guidance on our consolidated results of operations and financial condition.

In June 2008, the FASB issued a
new accounting standard that clarifies whether instruments granted in share-based payment transactions should be included in computing earnings per share. Under the new standard, we will be required to include restricted stock that contains
non-forfeitable rights to dividends in our calculation of basic earnings per share (EPS), and will need to calculate basic EPS using the two-class method. The two-class method of computing EPS is an earnings allocation
formula that determines EPS for each class of common stock and participating securities according to dividends declared (or accumulated) and participation rights in undistributed earnings. We will adopt this new accounting standard on a
retrospective basis in the first quarter of fiscal 2010. We do not expect the adoption of this standard will have a material effect on our calculation of basic EPS.



F-13



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



In December 2007, the FASB issued a new accounting standard related to business
combinations. The new standard expands the definition of a business and a business combination; requires recognition of assets acquired, liabilities assumed, and contingent consideration at their fair value on the acquisition date with subsequent
changes recognized in earnings; requires acquisition-related expenses and restructuring costs to be recognized separately from the business combination and expensed as incurred; requires in-process research and development to be capitalized at fair
value as an indefinite-lived intangible asset; and requires that changes in accounting for deferred tax asset valuation allowances and acquired income tax uncertainties after the measurement period be recognized as a component of provision for
taxes. The new guidance also establishes disclosure requirements to enable the evaluation of the nature and financial effects of the business combination. In April 2009, the FASB issued a new guidance which clarified the accounting for
pre-acquisition contingencies. We will adopt these new business combination guidance in the first quarter of fiscal 2010. The impact of adoption will be largely dependent on the size and nature of the business combinations completed after the
adoption of this statement.

In December 2007, the FASB issued a new accounting standard for noncontrolling interests in
consolidated financial statements. The new standard establishes accounting and reporting standards for ownership interests in subsidiaries held by parties other than the parent, the amount of consolidated net income attributable to the parent and to
the noncontrolling interest, changes in a parents ownership interest, and the valuation of retained noncontrolling equity investments when a subsidiary is deconsolidated. In addition, the guidance also establishes disclosure requirements that
clearly identify and distinguish between the interests of the parent and the interests of the noncontrolling owners. The guidance is effective for fiscal years beginning after December 15, 2008, and will be adopted by us in the first quarter of
fiscal year 2010. We do not expect the adoption of this guidance will have a material effect on our consolidated results of operations and financial condition.

In June 2009, the FASB issued a new accounting standard related to the consolidation of variable interest entities. It eliminates the quantitative approach previously required for determining the primary
beneficiary of a variable interest entity and requires ongoing qualitative reassessments of whether an enterprise is the primary beneficiary of a variable interest entity. This new standard also requires additional disclosures about an
enterprises involvement in variable interest entities. TIBCO does not have a variable interest entity. Therefore, the standard does not apply to us.

3.    Business Combination

Acquisition in Fiscal Year 2009

DataSynapse, Inc.

On August 21, 2009, we acquired DataSynapse, Inc., a Delaware corporation (DataSynapse) and a provider of enterprise grid and cloud computing software. DataSynapse products provision and
manage applications across physical, virtual and cloud-based environments. Customer benefits include improved utilization of data center resources, lower IT capital expenditures, reduced time to deployment of enterprise applications, and increased
performance of mission-critical systems. The acquisition will complement TIBCOs strategy and products for distributed software infrastructure and cloud computing. We paid $27.7 million of cash to acquire the outstanding shares of capital stock
of DataSynapse. In connection with the acquisition, we have also incurred transaction costs of approximately $0.8 million. The total purchase price of DataSynapse, including transaction costs, was $28.5 million.



F-14



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



A summary of the purchase price of the acquisition is as follows (in thousands):



|                         |  |   |       
|------------------------ |  | - | ------
|Cash paid                |  | $ | 27,700
|Direct transaction costs |  |   | 837   
|                         |  |   |       
|Total purchase price     |  | $ | 28,537
|                         |  |   |       

The preliminary allocation of the purchase price for this acquisition, as of the date
of the acquisition, is as follows (in thousands):



|                                 |  |   |         |  
|-------------------------------- |  | - | ------- | -
|Cash                             |  | $ | 1,052   |  
|Current assets                   |  |   | 3,245   |  
|Deferred income tax assets       |  |   | 4,358   |  
|Identifiable intangible assets   |  |   | 24,150  |  
|Goodwill                         |  |   | 8,820   |  
|                                 |  |   |         |  
|Total assets acquired            |  |   | 41,625  |  
|Liabilities                      |  |   | (12,933 | )
|Deferred income tax liabilities  |  |   | (3      | )
|Long-term income tax liabilities |  |   | (152    | )
|                                 |  |   |         |  
|Total liabilities assumed        |  |   | (13,088 | )
|                                 |  |   |         |  
|Net assets acquired              |  | $ | 28,537  |  
|                                 |  |   |         |  

While we use our best estimates and assumptions as a part of the purchase price
allocation process to accurately value assets acquired and liabilities assumed at the business combination date, our estimates and assumptions are inherently uncertain and subject to refinement. As a result, during the preliminary purchase price
allocation period, which may be up to one year from the business combination date, we record adjustments to the assets acquired and liabilities assumed, with the corresponding offset to goodwill. With the exception of unresolved income tax matters
or decreases to estimated restructuring liabilities, we record adjustments to assets acquired or liabilities assumed subsequent to the purchase price allocation period in our operating results in the period in which the adjustments were determined.

The total purchase price allocated to the tangible assets acquired was assigned based on the fair values as of the date of
the acquisition. The fair value assigned to identifiable intangible assets acquired was determined using the income approach which discounts expected future cash flows to present value using estimated assumptions determined by management. We believe
that these identified intangible assets will have no residual value after their estimated economic useful lives. These identifiable intangible assets are subject to amortization on a straight line basis as this best approximates the benefit period
related to these assets (in thousands, except amortization period):



|                        |  |                                |        |                                    |          
|----------------------- |  | ------------------------------ | ------ | ---------------------------------- | ---------
|                        |  | Gross Amountat AcquisitionDate |        | Weighted AverageAmortizationPeriod
|Existing technology     |  | $                              | 12,800 |                                    | 6.0 years
|Customer base           |  |                                | 3,200  |                                    | 8.0 years
|Patents/core technology |  |                                | 2,200  |                                    | 5.0 years
|Trademarks              |  |                                | 850    |                                    | 5.0 years
|Maintenance agreements  |  |                                | 5,100  |                                    | 7.0 years
|                        |  |                                |        |                                    |          
|                        |  | $                              | 24,150 |                                    | 6.4 years
|                        |  |                                |        |                                    |          



F-15



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



The excess of the purchase price over the identified tangible and intangible assets was
recorded as goodwill. We anticipate that none of the goodwill recorded in connection with the DataSynapse acquisition will be deductible for income tax purposes.

Acquisition in Fiscal Year 2008

Insightful Corporation

On September 3, 2008, we acquired all of the outstanding equity of Insightful Corporation (Insightful), a
provider of statistical data analysis and data mining solutions software. The acquisition of Insightful complements key growth areas within TIBCOs business optimization portfolio, including the TIBCO Spotfire enterprise analytics platform. We
paid $25.4 million, consisting of $24.7 million of cash and the assumption of certain stock options with a fair value of $0.8 million, to acquire the outstanding common stock and certain stock options of Insightful. In connection with
the acquisition, we also incurred transaction costs of $0.9 million. The total purchase price was $26.4 million. In allocating the purchase price based on estimated fair values, we recorded approximately $1.5 million of goodwill,
$16.2 million of identifiable intangible assets, and $8.7 million of net tangible assets.

As part of the
transaction, we assumed the Insightful Corporation Amended and Restated 2001 Stock Option and Incentive Plan (the 2001 Insightful Plan). As of September 3, 2008, there were approximately 0.5 million shares reserved for
grant and approximately 0.5 million shares underlying stock options outstanding under the 2001 Insightful Plan. Each outstanding and unexercised option under the plan was converted into an option to purchase our common stock based on the option
exchange ratio set forth in the Insightful Merger Agreement. Such assumed options had a weighted average fair value of $2.47 per share valued using the Black-Scholes model. The total fair value of the options assumed was $1.3 million, of which
approximately 0.3 million fully vested options with $0.8 million fair value were included in the purchase price. The remaining approximately 0.2 million unvested options with $0.5 million fair value will be expensed on a
straight-line basis over the remaining requisite service period of the underlying awards.

Acquisition in Fiscal Year 2007

Spotfire Holdings, Inc.

On June 5, 2007, we acquired Spotfire Holdings, Inc. (Spotfire), a privately held company and a leading provider of next generation business intelligence software, which is now part of
our business optimization product solution. The Spotfire acquisition extends TIBCOs Predictive Business strategy, by offering customers next-generation business intelligence solutions for radically faster data access and delivery. Combining
real-time infrastructure software with enterprise analytics allows TIBCO to deliver the industrys most complete real-time and event-driven software to businesses today. Spotfires technologies are architected to deliver a radically faster
experience and one that is infinitely more adaptable to multiple industries and business processes. We acquired all the outstanding equity excluding the unvested options of Spotfire for approximately $190.4 million in cash plus $3.2 million of
transaction costs. The total purchase price was $193.7 million. In allocating the purchase price based on estimated fair values, we recorded $120.2 million of goodwill, $72.3 million of identifiable intangible assets and $1.6 million
of in-process research and development (IPR&D). In addition, pursuant to the merger agreement related to the transaction, each unvested option of Spotfire was canceled and substituted with an option to purchase our common stock
(each, a Substitute Option). We granted approximately 887,000 shares of Substitute Options on the closing date of the acquisition. Substitute Options were valued using the Black-Scholes model on the date of the acquisition with a fair
value of $5.4 million and will be expensed as stock-based compensation on a straight-line basis over the remaining vesting period of the underlying awards.



F-16



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



The purchase method of accounting requires us to reduce Spotfires deferred revenue
as of the acquisition date to an amount equal to the fair value of the service and maintenance obligations assumed from Spotfire. We based our determination of the fair value of the service and maintenance obligations through established valuation
techniques using estimates and assumptions provided by management. As a result, in allocating the purchase price, we recorded an adjustment to reduce the carrying value of Spotfires deferred revenue resulting in lower revenues in periods
following the acquisition than Spotfire would have achieved as a separate company.

As of the acquisition date, the acquired
tangible assets included $34.3 million of accounts receivable for contracts with payment terms, of which $21.4 million are due within one year and are included in Other Current Assets and the remaining $12.9 million are due after one year and are
classified as non-current Other Assets on the Balance Sheet. As the fair value of the service and maintenance obligations assumed is less than the amount of accounts receivable with future payment terms, our cash flows related to these contracts are
anticipated to be greater than revenues recorded from these contracts.

Spotfire had a revolving line of credit with a bank
secured by certain Spotfire property and equipment. On the closing date of the acquisition, the outstanding balance under the revolving line of credit of $4.0 million was paid in full and the associated revolving line of credit loan agreement was
terminated.

Pro Forma Adjusted Summary

The results of DataSynapse and Insightfuls operations have been included in the Consolidated Financial Statements since the acquisition dates. The following unaudited pro forma adjusted summary
reflects TIBCOs condensed results of operations for the periods ended November 30, 2009 and 2008, respectively. The summary assumes DataSynapse had been acquired at the beginning of the periods and assumes Insightful had been acquired at
the beginning of fiscal year 2008. The unaudited pro forma adjusted summary combines the historical results for TIBCO for that period with the historical results for DataSynapse and Insightful for the same period. The following unaudited pro forma
adjusted summary is not intended to be indicative of future results (in thousands, except per share amounts):



|                                         |  |                        |         |      |   |        
|---------------------------------------- |  | ---------------------- | ------- | ---- | - | -------
|                                         |  | Year EndedNovember 30,
|                                         |  | 2009                   |         | 2008
|                                         |  | (Unaudited)           
|Pro forma adjusted total revenue         |  | $                      | 639,414 |      | $ | 690,238
|                                         |  |                        |         |      |   |        
|Pro forma adjusted net income            |  | $                      | 58,762  |      | $ | 32,051 
|                                         |  |                        |         |      |   |        
|Pro forma adjusted net income per share: |  |                        |         |      |   |        
|Basic                                    |  | $                      | 0.35    |      | $ | 0.18   
|                                         |  |                        |         |      |   |        
|Diluted                                  |  | $                      | 0.34    |      | $ | 0.17   
|                                         |  |                        |         |      |   |        



F-17



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



4.    Investments

Marketable securities, which are classified as available-for-sale, are summarized below as of November 30, 2009 and 2008 (in thousands):



|                                |  |                         |         |                      |   |                       |  |   |                     |   |                             |   |                       |  |   |         |  |   |       
|------------------------------- |  | ----------------------- | ------- | -------------------- | - | --------------------- |  | - | ------------------- | - | --------------------------- | - | --------------------- |  | - | ------- |  | - | ------
|                                |  |                         |         |                      |   |                       |  |   |                     |   | Classified on Balance Sheet
|                                |  | Purchased/AmortizedCost |         | GrossUnrealizedGains |   | GrossUnrealizedLosses |  |   | AggregateFair Value |   | Cashand
CashEquivalents     |   | Short-termInvestments
|As of November 30, 2009:        |  |                         |         |                      |   |                       |  |   |                     |   |                             |   |                       |  |   |         |  |   |       
|Money market funds              |  | $                       | 132,610 |                      | $ |                      |  | $ |                    |   |                             | $ | 132,610               |  | $ | 132,610 |  | $ |      
|Mortgage-backed securities      |  |                         | 334     |                      |   |                      |  |   | (27                 | ) |                             |   | 307                   |  |   |        |  |   | 307   
|                                |  |                         |         |                      |   |                       |  |   |                     |   |                             |   |                       |  |   |         |  |   |       
|                                |  | $                       | 132,944 |                      | $ |                      |  | $ | (27                 | ) |                             | $ | 132,917               |  | $ | 132,610 |  | $ | 307   
|                                |  |                         |         |                      |   |                       |  |   |                     |   |                             |   |                       |  |   |         |  |   |       
|As of November 30, 2008:        |  |                         |         |                      |   |                       |  |   |                     |   |                             |   |                       |  |   |         |  |   |       
|Money market funds              |  | $                       | 129,551 |                      | $ |                      |  | $ |                    |   |                             | $ | 129,551               |  | $ | 129,551 |  | $ |      
|U.S. Government debt securities |  |                         | 3,022   |                      |   | 12                    |  |   |                    |   |                             |   | 3,034                 |  |   |        |  |   | 3,034 
|Corporate debt securities       |  |                         | 5,795   |                      |   | 30                    |  |   | (1                  | ) |                             |   | 5,824                 |  |   |        |  |   | 5,824 
|Asset-backed securities         |  |                         | 2,483   |                      |   | 3                     |  |   | (8                  | ) |                             |   | 2,478                 |  |   |        |  |   | 2,478 
|Mortgage-backed securities      |  |                         | 1,747   |                      |   | 2                     |  |   | (12                 | ) |                             |   | 1,737                 |  |   |        |  |   | 1,737 
|                                |  |                         |         |                      |   |                       |  |   |                     |   |                             |   |                       |  |   |         |  |   |       
|                                |  | $                       | 142,598 |                      | $ | 47                    |  | $ | (21                 | ) |                             | $ | 142,624               |  | $ | 129,551 |  | $ | 13,073
|                                |  |                         |         |                      |   |                       |  |   |                     |   |                             |   |                       |  |   |         |  |   |       

Fixed income securities included in short-term investments above are summarized by
their contractual maturities as follows (in thousands):



|                        |  |              |     |      |   |       
|----------------------- |  | ------------ | --- | ---- | - | ------
|                        |  | November 30,
|                        |  | 2009         |     | 2008
|Contractual maturities: |  |              |     |      |   |       
|Less than one year      |  | $            |    |      | $ | 12,564
|One to three years      |  |              | 307 |      |   | 509   
|                        |  |              |     |      |   |       
|                        |  | $            | 307 |      | $ | 13,073
|                        |  |              |     |      |   |       

The maturities of asset-backed and mortgage-backed securities were primarily based
upon payment forecasts utilizing interest rate scenarios and mortgage loan characteristics.

The following table summarizes
the net realized gains (losses) on short-term investments for the fiscal years presented (in thousands):



|                            |  |                         |      |   |      |   |        |      |  |   |      |  
|--------------------------- |  | ----------------------- | ---- | - | ---- | - | ------ | ---- |  | - | ---- | -
|                            |  | Year Ended November 30, |     
|                            |  | 2009                    |      |   | 2008 |   |        | 2007 | 
|Realized gains              |  | $                       | 176  |   |      | $ | 1,351  |      |  | $ | 411  |  
|Realized losses             |  |                         | (356 | ) |      |   | (1,116 | )    |  |   | (723 | )
|                            |  |                         |      |   |      |   |        |      |  |   |      |  
|Net realized gains (losses) |  | $                       | (180 | ) |      | $ | 235    |      |  | $ | (312 | )
|                            |  |                         |      |   |      |   |        |      |  |   |      |  



F-18



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



The following table summarizes the fair value and gross unrealized losses related to
available-for-sale securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, as of November 30, 2009 (in thousands):



|                           |  |                     |     |                  |                     |     |           |       |                       |    |  |                |    |                       |  |   |     |  |   |     |  
|-------------------------- |  | ------------------- | --- | ---------------- | ------------------- | --- | --------- | ----- | --------------------- | -- |  | -------------- | -- | --------------------- |  | - | --- |  | - | --- | -
|                           |  | Less than 12 months |     |                  | More than 12 months |     |           | Total |                      
|                           |  | FairValue           |     | UnrealizedLosses |                     |     | FairValue |       | GrossUnrealizedLosses |    |  | GrossFairValue |    | GrossUnrealizedLosses | 
|Mortgage-backed securities |  | $                   | 255 |                  | $                   | (26 | )         |       | $                     | 52 |  | $              | (1 | )                     |  | $ | 307 |  | $ | (27 | )
|                           |  |                     |     |                  |                     |     |           |       |                       |    |  |                |    |                       |  |   |     |  |   |     |  

The unrealized losses on our investments were primarily due to changes in interest
rates and market and credit conditions of the underlying securities. As of November 30, 2009, we do not consider these investments to be other-than-temporarily impaired.

We periodically assess whether significant facts and circumstances have arisen to indicate an adverse effect on the fair value of the
underlying investment that might indicate material deterioration in the creditworthiness and other non-credit loss factors of our issuers. During fiscal years 2009, 2008, and 2007 we determined the decline in value of investments associated with
certain mortgage-backed securities to be other-than-temporary. Accordingly, we recorded an impairment of approximately $0.4 million, $0.6 million, and $0.3 million in fiscal years 2009, 2008, and 2007, respectively. We included this impairment in
Other Income (Expense) in the Consolidated Statements of Operations. Depending on market conditions, we may record additional impairments on our investment portfolio in the future.

5.    Fair Value Measurements and Derivative Instruments

Fair
Value Measurements

FASB guidance for fair value measurements clarifies that fair value is an exit price, representing
the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that
market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the guidance establishes a three-tier value hierarchy, which prioritizes the inputs used in measuring fair value as follows: (Level 1)
observable inputs such as quoted prices in active markets; (Level 2) inputs other than the quoted prices in active markets that are observable either directly or indirectly; and (Level 3) unobservable inputs in which there is little or no market
data, which require us to develop our own assumptions. This hierarchy requires us to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. On a recurring basis, we measure certain
financial assets and liabilities at fair value, including our marketable securities and foreign currency contracts.

Our cash
equivalents and investment instruments are classified within Level 1 or Level 2 of the fair value hierarchy because they are valued using quoted market prices, broker or dealer quotations, or alternative pricing sources with reasonable
levels of price transparency. The types of instruments valued based on quoted market prices in active markets include most U.S. government and agency securities, sovereign government obligations, and money market securities. Such instruments
are generally classified within Level 1 of the fair value hierarchy.

The types of instruments valued based on other
observable inputs include investment-grade corporate bonds, mortgage-backed and asset-backed products, state, municipal and provincial obligations. Such instruments are generally classified within Level 2 of the fair value hierarchy.



F-19



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



We execute our foreign currency contracts primarily in the retail market in an
over-the-counter environment with a relatively high level of price transparency. The market participants usually are large multi-national and regional banks. Our foreign currency contracts valuation inputs are based on quoted prices and quoted
pricing intervals from public data sources and do not involve management judgment. These contracts are typically classified within Level 2 of the fair value hierarchy.

Fair value hierarchy of our cash equivalents, marketable securities and foreign currency contracts at fair value (in thousands):



|                                   |  |                  |         |                                                            |   |                                           |  |   |    
|---------------------------------- |  | ---------------- | ------- | ---------------------------------------------------------- | - | ----------------------------------------- |  | - | ---
|                                   |  |                  |         | Fair Value Measurementsat Reporting
Date using            
|Description                        |  | November 30,2009 |         | Quoted Pricesin ActiveMarkets forIdentical Assets(Level 1) |   | SignificantotherObservableInputs(Level 2)
|Assets:                            |  |                  |         |                                                            |   |                                           |  |   |    
|Money market fund                  |  | $                | 132,610 |                                                            | $ | 132,610                                   |  | $ |   
|Mortgage-backed securities         |  |                  | 307     |                                                            |   |                                          |  |   | 307
|Foreign currency forward contracts |  |                  | 367     |                                                            |   |                                          |  |   | 367
|Liabilities:                       |  |                  |         |                                                            |   |                                           |  |   |    
|Foreign currency forward contracts |  | $                | 14      |                                                            | $ |                                          |  | $ | 14 

Derivative Instruments

We conduct business in the Americas; Europe, the Middle East and Africa (EMEA); and Asia Pacific and Japan (APJ). As
a result, our financial results could be affected by factors such as changes in foreign currency exchange rates or changes in economic conditions in foreign markets. The U.S. dollar is our major transaction currency, we also transact business in
approximately 20 foreign currencies worldwide, of which the most significant to our operations in fiscal year 2009 was the EURO. We enter into forward contracts with financial institutions to manage our currency exposure related to net assets and
liabilities denominated in foreign currencies, and these forward contracts are generally settled monthly. Our forward contracts reduce, but do not eliminate, the impact of currency exchange rate movements. We do not enter into derivative financial
instruments for trading purposes. Gains and losses on forward contracts are included in Other Income (Expense) in our Consolidated Statements of Operations.

We had six outstanding forward contracts with a total notional amount of $65.2 million as of November 30, 2009, which are summarized as follows (in thousands):



|                        |  |                             |  |                  |        |                          |   |     |  
|----------------------- |  | --------------------------- |  | ---------------- | ------ | ------------------------ | - | --- | -
|                        |  | NotionalValue LocalCurrency |  | NotionalValueUSD |        | Fair ValueGain (Loss)USD |  
|Forward contracts sold: |  |                             |  |                  |        |                          |   |     |  
|EURO                    |  | 38,600                      |  | $                | 57,867 |                          | $ | 311 |  
|Australian dollar       |  | 2,700                       |  |                  | 2,463  |                          |   | 37  |  
|Japanese yen            |  | 50,000                      |  |                  | 581    |                          |   | (9  | )
|South African rand      |  | 16,200                      |  |                  | 2,172  |                          |   | 11  |  
|Swiss franc             |  | 1,200                       |  |                  | 1,194  |                          |   | 8   |  
|New Taiwan dollar       |  | 29,000                      |  |                  | 903    |                          |   | (5  | )
|                        |  |                             |  |                  |        |                          |   |     |  
|                        |  |                             |  | $                | 65,180 |                          | $ | 353 |  
|                        |  |                             |  |                  |        |                          |   |     |  



F-20



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



|                                                            |  |                                                  |     |                  |   |    
|----------------------------------------------------------- |  | ------------------------------------------------ | --- | ---------------- | - | ---
|                                                            |  | Derivatives not Designatedas Hedging
Instruments
|                                                            |  | November 30,2009                                 |     | November 30,2008
|Foreign currency forward contracts, fair value included in: |  |                                                  |     |                  |   |    
|Other Current Assets                                        |  | $                                                | 367 |                  | $ | 694
|Accrued Liabilities                                         |  |                                                  | 14  |                  |   | 6  



|                                                  |  |                        |  |                                                           |         |   |      |   |      
|------------------------------------------------- |  | ---------------------- |  | --------------------------------------------------------- | ------- | - | ---- | - | -----
|                                                  |  |                        |  | Amount of Gain or(Loss) Recognized InIncome on Derivative
|                                                  |  |                        |  | Year EndedNovember
30,                                   
|Derivatives not Designated as Hedging Instruments |  | Location               |  | 2009                                                      |         |   | 2008
|Foreign Currency Contracts                        |  | Other income/(expense) |  | $                                                         | (13,125 | ) |      | $ | 8,132

Currently, we do not have master netting agreements with our counterparties for our
forward contracts. We mitigate the credit risk of these derivatives by transacting with highly rated counterparties. As of November 30, 2009, we have evaluated the credit and non-performance risks associated with our derivative counterparties,
and we believe that the impact of the credit risk associated with our outstanding derivatives was insignificant.

6.    Accounts Receivable and Allowances for Doubtful Accounts, Returns and Discounts

Accounts receivable, net, by category is as follows (in thousands):



|                                                              |  |              |         |   |      |   |         |  
|------------------------------------------------------------- |  | ------------ | ------- | - | ---- | - | ------- | -
|                                                              |  | November 30, |        
|                                                              |  | 2009         |         |   | 2008 |  
|Accounts receivable                                           |  | $            | 149,612 |   |      | $ | 128,283 |  
|Unbilled fees and services                                    |  |              | 9,356   |   |      |   | 9,277   |  
|                                                              |  |              |         |   |      |   |         |  
|                                                              |  |              | 158,968 |   |      |   | 137,560 |  
|Less: Allowances for doubtful accounts, returns and discounts |  |              | (4,224  | ) |      |   | (4,369  | )
|                                                              |  |              |         |   |      |   |         |  
|Net accounts receivable                                       |  | $            | 154,744 |   |      | $ | 133,191 |  
|                                                              |  |              |         |   |      |   |         |  

Trade accounts receivable are recorded at invoiced or to be invoiced amounts and do
not bear interest. We perform ongoing credit evaluations of our customers financial condition and, generally, require no collateral from our customers. Allowances for doubtful accounts, returns and discounts were established based on various
factors including credit profiles of our customers, contractual terms and conditions, historical payments, returns and discounts experience and current economic trends. We review our allowances monthly by assessing individual accounts receivable
over a specific aging and amount, and all other balances on a pooled basis based on historical collection experience. Accounts receivable are written off on a case-by-case basis, net of any amounts that may be collected.



F-21



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



The following is a summary of activities in allowances for doubtful accounts, returns
and discounts for the fiscal years indicated (in thousands):



|                        |  |                            |       |                       |   |                   |  |   |                                      |   |  |                         |        |   |  |   |      
|----------------------- |  | -------------------------- | ----- | --------------------- | - | ----------------- |  | - | ------------------------------------ | - |  | ----------------------- | ------ | - |  | - | -----
|Year ended November 30, |  | AllowancesBeginningBalance |       | ChargedAgainstRevenue |   | ChargedtoExpenses |  |   | Write-offs,AdjustmentsNet ofRecovery |   |  | AllowancesEndingBalance
|2009                    |  | $                          | 4,369 |                       | $ | 650               |  | $ | 350                                  |   |  | $                       | (1,145 | ) |  | $ | 4,224
|2008                    |  | $                          | 4,259 |                       | $ | 878               |  | $ | 573                                  |   |  | $                       | (1,341 | ) |  | $ | 4,369
|2007                    |  | $                          | 4,255 |                       | $ | 763               |  | $ | (525                                 | ) |  | $                       | (234   | ) |  | $ | 4,259

7.    Property and Equipment

Property and equipment by category is as follows (in thousands):



|                               |  |              |         |   |      |   |         |  
|------------------------------ |  | ------------ | ------- | - | ---- | - | ------- | -
|                               |  | November 30, |        
|                               |  | 2009         |         |   | 2008 |  
|Buildings                      |  | $            | 77,938  |   |      | $ | 77,938  |  
|Equipment and software         |  |              | 56,107  |   |      |   | 54,687  |  
|Furniture and fixtures         |  |              | 7,044   |   |      |   | 7,687   |  
|Facility improvements          |  |              | 46,886  |   |      |   | 44,871  |  
|                               |  |              |         |   |      |   |         |  
|                               |  |              | 187,975 |   |      |   | 185,183 |  
|Less: Accumulated depreciation |  |              | (93,344 | ) |      |   | (81,652 | )
|                               |  |              |         |   |      |   |         |  
|                               |  | $            | 94,631  |   |      | $ | 103,531 |  
|                               |  |              |         |   |      |   |         |  

Building Acquisition

In June 2003, we purchased the four buildings comprising our corporate headquarters in Palo Alto, California. In connection with the purchase
we entered into a 51-year lease of the land upon which the buildings are located. The lease was paid in advance in the amount of $28.0 million; see Note 12 for further details. The total consideration paid for the land lease and the buildings was
$108.0 million, which was comprised of $54.0 million in cash and a $54.0 million mortgage note payable; see Note 10 and Note 12 for further details.

The net purchase price of the buildings of $77.9 million is stated at cost and is included as a component of Property and Equipment on the Consolidated Balance Sheets. Depreciation is computed using the
straight-line method over the estimated useful life of 25 years.



F-22



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



8.    Goodwill and Other Acquired Intangible Assets

Goodwill

The changes
in the carrying amount of goodwill for the fiscal years ended November 30, 2009 and 2008 are as follows (in thousands):



|                                                      |  |          |         |  
|----------------------------------------------------- |  | -------- | ------- | -
|                                                      |  | Goodwill |        
|Balance as of November 30, 2007                       |  | $        | 412,256 |  
|Goodwill recorded for the Insightful acquisition      |  |          | 2,533   |  
|Spotfire subsequent goodwill adjustment, net of tax   |  |          | (1,207  | )
|Foreign currency translation                          |  |          | (69,640 | )
|                                                      |  |          |         |  
|Balance as of November 30, 2008                       |  | $        | 343,942 |  
|Goodwill recorded for the DataSynapse acquisition     |  |          | 8,820   |  
|Insightful subsequent goodwill adjustment, net of tax |  |          | (1,005  | )
|Foreign currency translation                          |  |          | 22,528  |  
|                                                      |  |          |         |  
|Balance as of November 30, 2009                       |  | $        | 374,285 |  
|                                                      |  |          |         |  

In fiscal year 2009, we recorded a decrease in goodwill of $1.0 million net of tax as
a result of the settlement of certain accrued liabilities and a reduction of accrued acquisition costs related to the acquisition of Insightful. In fiscal year 2008, we recorded a decrease in goodwill of $1.2 million net of tax as a result of the
settlement of certain accrued liabilities and a reduction of accrued acquisition costs related to the acquisition of Spotfire.

Acquired
Intangible Assets

Our acquired intangible assets are subject to amortization on a straight line basis over their
estimated useful lives as follows:



|                          |  |               |  |                               
|------------------------- |  | ------------- |  | ------------------------------
|                          |  | EstimatedLife |  | Weighted AverageRemaining Life
|Developed technologies    |  | 4 to 5 years  |  | 3.4 years                     
|Customer base             |  | 3 to 7 years  |  | 5.1 years                     
|Patents/core technologies |  | 3 to 8 years  |  | 2.7 years                     
|Trademarks                |  | 3 to 5 years  |  | 3.6 years                     
|Non-compete agreements    |  | 2 years       |  |  years                       
|Maintenance agreements    |  | 5 to 9 years  |  | 4.3 years                     



F-23



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



The carrying values of our amortized acquired intangible assets are as follows (in
thousands):



|                          |  |                     |         |                         |   |          |                   |  |                     |        |                         |   |         |                   |   |          |   |  |   |       
|------------------------- |  | ------------------- | ------- | ----------------------- | - | -------- | ----------------- |  | ------------------- | ------ | ----------------------- | - | ------- | ----------------- | - | -------- | - |  | - | ------
|                          |  | November 30, 2009   |         | November 30, 2008      
|                          |  | GrossCarryingAmount |         | AccumulatedAmortization |   |          | NetCarryingAmount |  | GrossCarryingAmount |        | AccumulatedAmortization |   |         | NetCarryingAmount
|Developed technologies    |  | $                   | 102,805 |                         | $ | (70,409  | )                 |  | $                   | 32,396 |                         | $ | 83,853  |                   | $ | (52,885  | ) |  | $ | 30,968
|Customer base             |  |                     | 44,193  |                         |   | (28,354  | )                 |  |                     | 15,839 |                         |   | 37,461  |                   |   | (21,967  | ) |  |   | 15,494
|Patents/core technologies |  |                     | 22,311  |                         |   | (13,768  | )                 |  |                     | 8,543  |                         |   | 18,460  |                   |   | (9,424   | ) |  |   | 9,036 
|Trademarks                |  |                     | 7,223   |                         |   | (5,612   | )                 |  |                     | 1,611  |                         |   | 5,981   |                   |   | (4,666   | ) |  |   | 1,315 
|Non-compete agreements    |  |                     | 1,480   |                         |   | (1,480   | )                 |  |                     |       |                         |   | 1,480   |                   |   | (1,280   | ) |  |   | 200   
|Maintenance agreements    |  |                     | 46,284  |                         |   | (21,613  | )                 |  |                     | 24,671 |                         |   | 37,611  |                   |   | (14,187  | ) |  |   | 23,424
|                          |  |                     |         |                         |   |          |                   |  |                     |        |                         |   |         |                   |   |          |   |  |   |       
|                          |  | $                   | 224,296 |                         | $ | (141,236 | )                 |  | $                   | 83,060 |                         | $ | 184,846 |                   | $ | (104,409 | ) |  | $ | 80,437
|                          |  |                     |         |                         |   |          |                   |  |                     |        |                         |   |         |                   |   |          |   |  |   |       

Amortization of developed technologies is recorded in cost of revenue, while the
amortization of other acquired intangible assets is included in operating expenses. The following summarizes the amortization expense of acquired intangible assets for the fiscal years indicated (in thousands):



|                                            |  |                         |        |      |   |        |  |   |       
|------------------------------------------- |  | ----------------------- | ------ | ---- | - | ------ |  | - | ------
|                                            |  | Year Ended November 30,
|                                            |  | 2009                    |        | 2008 |   | 2007  
|Amortization of acquired intangible assets: |  |                         |        |      |   |        |  |   |       
|In cost of revenue                          |  | $                       | 13,463 |      | $ | 15,745 |  | $ | 10,326
|In operating expenses                       |  |                         | 14,165 |      |   | 16,557 |  |   | 13,164
|                                            |  |                         |        |      |   |        |  |   |       
|                                            |  | $                       | 27,628 |      | $ | 32,302 |  | $ | 23,490
|                                            |  |                         |        |      |   |        |  |   |       

The estimated future amortization of acquired intangible assets as of
November 30, 2009 is as follows (in thousands):



|                         |  |   |        
|------------------------ |  | - | -------
|Year ending November 30, |  |  
|2010                     |  | $ | 27,661 
|2011                     |  |   | 22,063 
|2012                     |  |   | 13,713 
|2013                     |  |   | 11,309 
|2014                     |  |   | 5,452  
|Thereafter               |  |   | 2,862  
|                         |  |   |        
|                         |  |   | $83,060
|                         |  |   |        

9.    Accrued Restructuring and Excess Facilities Costs

Accrued Integration Costs

In connection with our acquisitions of DataSynapse in fiscal year 2009, Insightful in fiscal year 2008, and Spotfire in fiscal year 2007, we recorded accruals for acquisition integration liabilities,
which include the incremental costs to exit and consolidate activities at acquired locations, termination of certain employees, and other costs to integrate operating locations and other activities of the acquired companies. The accruals in
connection with these acquisition integration expenses, which are not associated with the generation of future



F-24



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



revenues and have no future economic benefit, should be reflected as assumed liabilities in the allocation of the purchase price to the net assets acquired.

In connection with our acquisition of DataSynapse in the third quarter of fiscal year 2009, we recorded an accrual of $1.6 million for
acquisition integration liabilities, which includes $1.0 million in incremental costs associated with the termination of certain employees and $0.6 million for the estimated costs associated with DataSynapse facilities that we expect to abandon.

In connection with our acquisition of Insightful in the fourth quarter of fiscal year 2008, we recorded an accrual of $3.3
million for acquisition integration liabilities, which includes $3.1 million in incremental costs associated with the termination of certain employees and $0.2 million for the estimated costs associated with Insightful facilities that we expect to
abandon. Included in the $3.1 million of incremental costs is $0.2 million of stock-based compensation associated with the fully vested stock options assumed in the acquisition. As of November 30, 2009, all of the obligations related to the
Insightful integration were satisfied.

In connection with our acquisition of Spotfire in the third quarter of fiscal year
2007, we recorded an accrual of $0.4 million for acquisition integration liabilities, which include the incremental cost associated with the termination of certain employees; as of November 30, 2008, all of these employees were terminated. As
of November 30, 2008, all of the obligations related to the Spotfire integration were satisfied.

Accrued Restructuring Costs

2002 Restructuring Program.    In fiscal year 2002, we recorded restructuring charges
totaling $49.3 million, consisting of $47.6 million related to consolidation of facilities and $1.7 million for headcount reductions which had been fully utilized. These restructuring charges were recorded to align our cost structure with changing
market conditions. We expected to fulfill our cash obligation no later than 2011. We have been working with corporate real estate brokers to sublease unoccupied facilities. Currently, a majority of these vacated facilities are occupied by our
tenants.

In the third quarter of fiscal year 2007, we recorded a $1.1 million credit adjustment to the restructuring charges
related to properties vacated in connection with facilities consolidation. The adjustment resulted from revisions to our estimates of future sublease income due to the recovery of the applicable real estate market.



F-25



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



The following is a summary of activities in accrued restructuring and integration costs
for each of the three fiscal years ended November 30, 2009, 2008 and 2007 (in thousands):



|                              |  |                           |        |   |                        |   |      |          |  |   |                           |   |  |       |        |   |  |   |        |  
|----------------------------- |  | ------------------------- | ------ | - | ---------------------- | - | ---- | -------- |  | - | ------------------------- | - |  | ----- | ------ | - |  | - | ------ | -
|                              |  | Accrued Excess Facilities |        |   |                        |   |      |          | 
|                              |  | HeadquarterFacilities     |        |   | AcquisitionIntegration |   |      | Subtotal |  |   | AccruedSeveranceand Other |   |  | Total |       
|As of November 30, 2006       |  | $                         | 21,844 |   |                        | $ | 557  |          |  | $ | 22,401                    |   |  | $     |       |   |  | $ | 22,401 |  
|Restructuring adjustment      |  |                           | (1,095 | ) |                        |   |     |          |  |   | (1,095                    | ) |  |       |       |   |  |   | (1,095 | )
|Acquisition integration costs |  |                           |       |   |                        |   |     |          |  |   |                          |   |  |       | 404    |   |  |   | 404    |  
|Cash utilized                 |  |                           | (5,153 | ) |                        |   | 77   |          |  |   | (5,076                    | ) |  |       | (401   | ) |  |   | (5,477 | )
|                              |  |                           |        |   |                        |   |      |          |  |   |                           |   |  |       |        |   |  |   |        |  
|As of November 30, 2007       |  |                           | 15,596 |   |                        |   | 634  |          |  |   | 16,230                    |   |  |       | 3      |   |  |   | 16,233 |  
|Acquisition integration costs |  |                           |       |   |                        |   | 192  |          |  |   | 192                       |   |  |       | 3,081  |   |  |   | 3,273  |  
|Cash utilized                 |  |                           | (4,967 | ) |                        |   | (703 | )        |  |   | (5,670                    | ) |  |       | (1,670 | ) |  |   | (7,340 | )
|                              |  |                           |        |   |                        |   |      |          |  |   |                           |   |  |       |        |   |  |   |        |  
|As of November 30, 2008       |  | $                         | 10,629 |   |                        | $ | 123  |          |  | $ | 10,752                    |   |  | $     | 1,414  |   |  | $ | 12,166 |  
|Acquisition integration costs |  |                           |       |   |                        |   | 579  |          |  |   | 579                       |   |  |       | 1,020  |   |  |   | 1,599  |  
|Restructuring adjustment      |  |                           |       |   |                        |   |     |          |  |   |                          |   |  |       | (721   | ) |  |   | (721   | )
|Cash utilized                 |  |                           | (4,818 | ) |                        |   | (302 | )        |  |   | (5,120                    | ) |  |       | (993   | ) |  |   | (6,113 | )
|                              |  |                           |        |   |                        |   |      |          |  |   |                           |   |  |       |        |   |  |   |        |  
|As of November 30, 2009       |  | $                         | 5,811  |   |                        | $ | 400  |          |  | $ | 6,211                     |   |  | $     | 720    |   |  | $ | 6,931  |  
|                              |  |                           |        |   |                        |   |      |          |  |   |                           |   |  |       |        |   |  |   |        |  

The remaining accrued excess facilities costs represent the estimated loss on
abandoned facilities, net of sublease income, which is expected to be paid over by December 2010. As of November 30, 2009, $1.1 million of the $6.9 million accrued restructuring and excess facilities costs were classified as long-term
liabilities based on our current expectation that the lease payments will be paid over the remaining term of the related leases.

10.    Long-Term Debt and Lines of Credit

Mortgage Note Payable

In connection with the purchase of our corporate headquarters in June 2003, we recorded a $54.0 million mortgage note payable to a financial
institution collateralized by the commercial real property acquired. The balance on the mortgage note payable was $42.5 million and $44.6 million as of November 30, 2009 and 2008, respectively. Our mortgage note payable has a fair value that is
not materially different from its carrying amount.

The mortgage note payable carries a 20-year amortization, and in the
second quarter of fiscal year 2007, we amended the mortgage note payable such that it now carries a fixed annual interest rate of 5.50%. The $34.4 million principal balance that will be remaining at the end of the 10-year term will be due as a final
lump sum payment on July 1, 2013. Under the currently applicable terms of the mortgage note agreements, we are prohibited from acquiring another company without prior consent from the lender unless we maintain at least $50.0 million of cash or
cash equivalents and meet other non-financial terms as defined in the agreements. In addition, we are subject to certain non-financial covenants as defined in the agreements. As of November 30, 2009, we were in compliance with all covenants.

Line of Credit

In November 2009, we entered into a $150.0 million unsecured revolving credit facility (the Credit Agreement) that matures in November 2012. The revolving credit facility is available for cash
borrowings up to $150.0 million, with a sublimit for the issuance of standby letters of credit in a face amount up to $25.0 million



F-26



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



and swing line loans up to $10.0 million. At the same time, we canceled an existing standalone irrevocable letter of credit in the amount of $4.5 million in connection with a facility lease and
issued a new letter of credit under the Credit Agreement in the same amount. As of November 30, 2009, no borrowings were outstanding under the Credit Agreement and a $4.5 million irrevocable letter of credit was outstanding, leaving $145.5
million of available credit for cash borrowings, of which $20.5 million is available for additional letters of credit. Revolving loans accrue interest at a per annum rate based on either (i) the base rate plus a margin ranging from 2.25% to
3.00%, depending on TIBCOs consolidated leverage ratio or (ii) the LIBOR rate plus a margin ranging from 3.25% to 4.00%, depending on TIBCOs consolidated leverage ratio, for various interest periods. The base rate is defined as the
highest of (i) the administrative agents prime rate (ii) the federal funds rate plus a margin equal to 0.50%, and (iii) except during a period when LIBOR rates are unavailable, the LIBOR rate for a one month interest period plus
a margin equal to 1.00%. Swing line loans accrue interest at a per annum rate based on the base rate plus a margin ranging from 2.25% to 3.00%. A commitment fee is applied to the un-borrowed amount at a per annum rate ranging from 0.50% to 0.75%. A
$2.3 million loan origination fee and issuance costs incurred upon consummation of the Credit Agreement will be amortized through interest expense over a period of three years. Other customary fees and letter of credit fees may be charged as they
are incurred. All fees would be recognized over the life of the facility as an adjustment of interest expense. Under certain circumstances, a default interest rate will apply on all obligations during the existence of an event of default under the
Credit Agreement at a per annum rate equal to 2.00% above the applicable interest rate. In order to make acquisitions under the Credit Agreement, the Credit Agreement requires, among other things, that immediately after giving pro forma effect to
any such acquisition we maintain $120.0 million of total unrestricted cash, cash equivalents, certain short-term investments and total available borrowings, of which $80.0 million must be held by a financial institution with the account residing in
the United States. Under this Credit Agreement, we must maintain a minimum consolidated interest coverage ratio of 3.5:1.0 and a maximum consolidated leverage ratio of 2.5:1.0 in addition to other customary affirmative and negative covenants. As of
November 30, 2009, we were in compliance with all covenants of this facility.

We also have a $20.0 million revolving
line of credit that matures on June 17, 2010. The revolving line of credit is available for cash borrowings and for the issuance of letters of credit up to $20.0 million. As of November 30, 2009, no borrowings were outstanding under the
facility and two irrevocable letters of credit in the amounts of $13.0 million and approximately $1.0 million were outstanding, leaving $6.0 million of available credit for additional letters of credit or cash borrowings. The $13.0 million
irrevocable letter of credit outstanding was issued in connection with the mortgage note payable. The letter of credit automatically renews for successive one-year periods, until the mortgage note payable has been satisfied in full. The
approximately $1.0 million irrevocable letter of credit outstanding was issued in connection with a sales transaction denominated in foreign currency and will remain outstanding until July 2012. The line of credit requires that we maintain a minimum
of $40.0 million in unrestricted cash, cash equivalents and short-term investments, net of total current and long-term indebtedness, as well as comply with other non-financial covenants defined in the agreement. As of November 30, 2009, we were
in compliance with all covenants under the revolving line of credit.



F-27



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



11.    Other Balance Sheet Components

Certain other balance sheet components are summarized below (in thousands):



|                                                                 |  |              |        |      |   |       
|---------------------------------------------------------------- |  | ------------ | ------ | ---- | - | ------
|                                                                 |  | November 30,
|                                                                 |  | 2008         |        | 2009
|Prepaid expenses and other current assets:                       |  |              |        |      |   |       
|Current deferred tax asset                                       |  | $            | 28,413 |      | $ | 22,242
|Pre-acquisition receivableSpotfire(1)                           |  |              | 776    |      |   | 7,475 
|Consumption, goods and services; and value added tax recoverable |  |              | 5,579  |      |   | 7,252 
|Prepaid royalties                                                |  |              | 5,363  |      |   | 4,387 
|Other                                                            |  |              | 12,526 |      |   | 8,638 
|                                                                 |  |              |        |      |   |       
|                                                                 |  | $            | 52,657 |      | $ | 49,994
|                                                                 |  |              |        |      |   |       
|Other non-current assets:                                        |  |              |        |      |   |       
|Prepaid land lease                                               |  | $            | 23,928 |      | $ | 24,477
|Pre-acquisition receivable  Spotfire, net of current portion(1) |  |              | 129    |      |   | 1,303 
|Restricted cash                                                  |  |              | 5,581  |      |   | 3,010 
|Private equity investments, net                                  |  |              | 799    |      |   | 846   
|Other                                                            |  |              | 13,632 |      |   | 10,229
|                                                                 |  |              |        |      |   |       
|                                                                 |  | $            | 44,069 |      | $ | 39,865
|                                                                 |  |              |        |      |   |       
|Accrued liabilities:                                             |  |              |        |      |   |       
|Compensation and benefits                                        |  | $            | 62,629 |      | $ | 53,767
|Taxes                                                            |  |              | 8,909  |      |   | 14,191
|Current deferred tax liability                                   |  |              | 3,159  |      |   | 3,236 
|Other                                                            |  |              | 21,898 |      |   | 19,786
|                                                                 |  |              |        |      |   |       
|                                                                 |  | $            | 96,595 |      | $ | 90,980
|                                                                 |  |              |        |      |   |       



|(1) | Accounts receivable for contracts with payment terms related to the Spotfire acquisition, which had not been billed as of the acquisition date; see Note 3 for further
details.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

12.    Commitments and Contingencies

Letters of Credit and Bank Guarantees

In connection with the mortgage note payable, we entered into an irrevocable letter of credit in the amount of $13.0 million; in connection with a sale transaction denominated in foreign currency we
entered into an irrevocable letter of credit in the amount of approximately $1.0 million; see Note 7 and Note 10 for further details. The letter of credit is collateralized by the $20.0 million revolving line of credit described above in Note 10 and
automatically renews for successive one-year periods until the mortgage note payable has been satisfied in full. As of November 30, 2009, we were in compliance with all covenants under the revolving line of credit.

In connection with a facility lease, we have an irrevocable letter of credit in the amount of $4.5 million. The letter of credit
automatically renews annually for the duration of the lease term, which expires in December 2010. In November, 2009, this letter of credit was cancelled and a new letter of credit under the Credit Agreement in the same amount was issued. This new
letter of credit is subject to the financial covenants defined in the Credit Agreement; see Note 10 for further details.



F-28



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



As of November 30, 2009, in connection with bank guarantees issued by some of our
international subsidiaries, we had $5.6 million of restricted cash which is included in Other Assets on our Consolidated Balance Sheets.

Prepaid Land Lease

In June 2003, we entered into a 51-year lease of the land upon which our corporate
headquarters is located. The lease was paid in advance for a total of $28.0 million, but is subject to adjustments every ten years based upon changes in market condition. Should it become necessary, we have the option to prepay any rent increases
due as a result of a change in fair market value. This prepaid land lease is being amortized using the straight-line method over the life of the lease; the portion to be amortized over the next twelve months is included in Prepaid Expenses and Other
Current Assets, and the remainder is included in Other Assets on our Consolidated Balance Sheets.

Operating Commitments

At various locations worldwide, we lease office space and equipment under non-cancelable operating leases with various
expiration dates through April 2015. Rental expense was approximately $9.7 million, $10.5 million and $10.4 million in fiscal years 2009, 2008 and 2007, respectively.

As of November 30, 2009, contractual commitments associated with indebtedness, lease obligations and restructuring are as follows (in thousands):



|                                   |  |       |        |   |      |   |        |      |  |   |        |   |      |   |        |  |            |        |  |   |       |  |   |      
|---------------------------------- |  | ----- | ------ | - | ---- | - | ------ | ---- |  | - | ------ | - | ---- | - | ------ |  | ---------- | ------ |  | - | ----- |  | - | -----
|                                   |  | Total |        |   | 2010 |   |        | 2011 |  |   | 2012   |   | 2013 |   | 2014   |  | Thereafter
|Operating commitments:             |  |       |        |   |      |   |        |      |  |   |        |   |      |   |        |  |            |        |  |   |       |  |   |      
|Debt principal                     |  | $     | 42,525 |   |      | $ | 2,148  |      |  | $ | 2,269  |   |      | $ | 2,397  |  | $          | 35,711 |  | $ |      |  | $ |     
|Debt interest                      |  |       | 7,768  |   |      |   | 2,285  |      |  |   | 2,164  |   |      |   | 2,036  |  |            | 1,283  |  |   |      |  |   |     
|Operating leases                   |  |       | 31,124 |   |      |   | 9,849  |      |  |   | 8,313  |   |      |   | 5,648  |  |            | 3,881  |  |   | 2,483 |  |   | 950  
|                                   |  |       |        |   |      |   |        |      |  |   |        |   |      |   |        |  |            |        |  |   |       |  |   |      
|                                   |  |       | 81,417 |   |      |   | 14,282 |      |  |   | 12,746 |   |      |   | 10,081 |  |            | 40,875 |  |   | 2,483 |  |   | 950  
|                                   |  |       |        |   |      |   |        |      |  |   |        |   |      |   |        |  |            |        |  |   |       |  |   |      
|Restructuring-related commitments: |  |       |        |   |      |   |        |      |  |   |        |   |      |   |        |  |            |        |  |   |       |  |   |      
|Gross lease obligations            |  |       | 8,497  |   |      |   | 7,288  |      |  |   | 734    |   |      |   | 75     |  |            | 75     |  |   | 75    |  |   | 250  
|Committed sublease income          |  |       | (2,871 | ) |      |   | (2,632 | )    |  |   | (239   | ) |      |   |       |  |            |       |  |   |      |  |   |     
|                                   |  |       |        |   |      |   |        |      |  |   |        |   |      |   |        |  |            |        |  |   |       |  |   |      
|                                   |  |       | 5,626  |   |      |   | 4,656  |      |  |   | 495    |   |      |   | 75     |  |            | 75     |  |   | 75    |  |   | 250  
|                                   |  |       |        |   |      |   |        |      |  |   |        |   |      |   |        |  |            |        |  |   |       |  |   |      
|Total commitments                  |  | $     | 87,043 |   |      | $ | 18,938 |      |  | $ | 13,241 |   |      | $ | 10,156 |  | $          | 40,950 |  | $ | 2,558 |  | $ | 1,200
|                                   |  |       |        |   |      |   |        |      |  |   |        |   |      |   |        |  |            |        |  |   |       |  |   |      

Future minimum lease payments under restructured non-cancelable operating leases as
of November 30, 2009, are included in Accrued Restructuring and Excess Facilities Costs on our Consolidated Balance Sheets; see Note 9 for further details.

The above commitment table does not include approximately $17.0 million of long-term income tax liabilities recorded in accounting for uncertainty in income taxes due to the fact that we are unable to
reasonably estimate the timing of these potential future payments.

Indemnifications

Our software license agreements typically provide for indemnification of customers for intellectual property infringement claims. To date, no
such claims have been filed against us. We also warrant to customers that software products operate substantially in accordance with the software products specifications. Historically, we



F-29



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



have incurred minimal costs related to product warranties, and, as such, no accruals for warranty costs have been made. In addition, we indemnify our officers and directors under the terms of
indemnity agreements entered into with them, as well as pursuant to our certificate of incorporation, bylaws and applicable Delaware law.

To date, we have incurred costs for the payment of legal fees in connection with the legal proceedings detailed in Note 13.

13.    Legal Proceedings

IPO Allocation Suit

We, certain of our directors and officers, and certain investment bank underwriters have been named in a putative class action for
violation of the federal securities laws in the United States District Court for the Southern District of New York, captioned In re TIBCO Software Inc. Initial Public Offering Securities Litigation. This is one of a number of cases
challenging underwriting practices in the initial public offerings (each, an IPO) of more than 300 companies, which have been coordinated for pretrial proceedings as In re Initial Public Offering Securities Litigation.
Plaintiffs generally allege that the underwriters engaged in undisclosed and improper underwriting activities, namely the receipt of excessive brokerage commissions and customer agreements regarding post-offering purchases of stock in exchange for
allocations of IPO shares. Plaintiffs also allege that various investment bank securities analysts issued false and misleading analyst reports. The complaint against us claims that the purported improper underwriting activities were not disclosed in
the registration statements for our IPO and secondary public offering and seeks unspecified damages on behalf of a purported class of persons who purchased our securities or sold put options during the time period from July 13, 1999 to
December 6, 2000.

A lawsuit with similar allegations of undisclosed improper underwriting practices, and part of the
same coordinated proceedings, is pending against Talarian, which we acquired in 2002. That action is captioned In re Talarian Corp. Initial Public Offering Securities Litigation. The complaint against Talarian, certain of its
underwriters and certain of its former directors and officers claims that the purported improper underwriting activities were not disclosed in the registration statement for Talarians IPO and seeks unspecified damages on behalf of a purported
class of persons who purchased Talarian securities during the time period from July 20, 2000 to December 6, 2000.

In 2004, a stipulation of Settlement (the Settlement) was submitted to the Court, and in 2005, the Court granted preliminary approval. Under the Settlement, we and our subsidiary Talarian would have been dismissed of all claims
in exchange for a contingent payment guarantee by the insurance companies responsible for insuring us and Talarian as issuers. Class certification was a condition of the Settlement. After the Second Circuit Court of Appeals issued a ruling
overturning class certification in six test cases for the coordinated proceedings, the Settlement was terminated in June 2007 by stipulation of the parties and order of the Court. On August 14, 2007, plaintiffs filed amended master allegations
and amended complaints in the six test cases. On March 26, 2008, the Court denied the defendants motion to dismiss the amended complaints in the six test cases.

The parties have reached a global settlement of the litigation, including the actions against us and Talarian. Under the settlement, the
insurers will pay the full amount of settlement share allocated to us (our financial liability will be limited to paying the remaining balance of the applicable retention under Talarians directors and officers liability insurance policy).
In addition, we, as well as the officer and director defendants who were previously dismissed from the action pursuant to tolling agreements, will receive complete dismissals from the case. On October 5, 2009, the Court granted final approval
of the settlement. Certain objectors are seeking to appeal from this order.



F-30



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



Patent Suit

On March 30, 2009, Broadband Graphics, LLC (Broadband Graphics) filed a complaint for patent infringement against us in the United States District Court for the Western District of
Washington. The complaint alleged that our Spotfire software and other unspecified products infringe one or more of the claims of U.S. Patent Nos. 7,013,432, 7,313,765 and 7,013,431, assigned to Broadband Graphics. The complaint sought, among other
things, injunctive relief and unspecified damages. On September 15, 2009, Broadband Graphics filed an amended complaint, adding U.S. Patent No. 7,539,947. The amended complaint sought, among other things, injunctive relief and unspecified
damages. We filed an answer on October 2, 2009 denying the claims and filed a counterclaim seeking a declaratory judgment that the patents are invalid and not infringed.

On October 7, 2009, we and Broadband Graphics executed a confidential settlement agreement, resolving all claims between the parties
relating to the lawsuit. Pursuant to the settlement, Broadband Graphics complaint was dismissed with prejudice on October 15, 2009.

14.    Stockholders Equity

Preferred Stock

Our certificate of incorporation, as amended and restated, authorizes us to issue 75.0 million shares of $0.001 par value preferred
stock. As of November 30, 2009, no preferred stock was issued or outstanding.

Common Stock

Our certificate of incorporation, as amended and restated, authorizes us to issue 1.2 billion shares of $0.001 par value common stock. As of
November 30, 2009, approximately 167,738,000 shares of common stock were issued and outstanding. The outstanding shares of common stock as of November 30, 2009 include approximately 4,081,000 shares of restricted stock. All of the
outstanding shares of restricted stock remain unvested as of November 30, 2009. The balance of unvested restricted stock will be forfeited and automatically transferred back to us at no cost upon the recipients discontinuing employment
for any reason.

Adoption of Stockholder Rights Plan

In February 2004, our Board of Directors adopted a stockholder rights plan designed to guard against partial tender offers and other coercive
tactics to gain control of us without offering a fair and adequate price and terms to all of our stockholders.

In connection
with the plan, the Board of Directors declared a dividend of one right (a Right) to purchase one one-thousandth share of our Series A Participating Preferred Stock (Series A Preferred) for each share of our common stock
outstanding on March 5, 2004 (the Record Date). Of the 75.0 million shares of preferred stock authorized under our certificate of incorporation, as amended and restated, 25.0 million have been designated as Series A
Preferred. The Board of Directors further directed the issuance of one such right with respect to each share of our common stock that is issued after the Record Date, except in certain circumstances. The rights will expire on March 5, 2014.

The Rights are initially attached to our common stock and will not be traded separately. If a person or a group (an
Acquiring Person) acquires 15% or more of our common stock, or announces an intention to make a tender offer for 15% or more of our common stock, the Rights will be distributed and will thereafter be traded separately from the common
stock. Each Right will be exercisable for 1/1000th of a share of Series A Preferred



F-31



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



at an exercise price of $70 (the Purchase Price). The Series A Preferred has been structured so that the value of 1/1000th of a share of such preferred stock will approximate the
value of one share of common stock. Upon a person becoming an Acquiring Person, holders of the Rights (other than the Acquiring Person) will have the right to receive, upon exercise, shares of our common stock having a value equal to two times the
Purchase Price.

If a person becomes an Acquiring Person and we are acquired in a merger or other business combination, or 50%
or more of our assets are sold to an Acquiring Person, the holder of Rights (other than the Acquiring Person) will have the right to receive shares of common stock of the acquiring corporation having a value equal to two times the Purchase Price.
After a person has become an Acquiring Person, our Board of Directors may, at its option, require the exchange of outstanding Rights (other than those held by the Acquiring Person) for common stock at an exchange ratio of one share of our common
stock per Right.

The Board may redeem outstanding rights at any time prior to a person becoming an Acquiring Person at a
price of $0.001 per Right. Prior to such time, the terms of the Rights may be amended by the Board of Directors.

Stock Repurchase
Programs

In April 2007, our Board of Directors approved a stock repurchase program pursuant to which were authorized
to repurchase up to $300.0 million of our outstanding common stock from time to time in the open market or through privately negotiated transactions. In connection with approving the April 2007 stock repurchase program, the December 2006 stock
repurchase program was terminated and the remaining authorized amount of $58.2 million under the December 2006 stock repurchase program was canceled.

In April 2008, our Board of Directors approved a new stock repurchase program pursuant to which we may repurchase up to $300.0 million of our outstanding common stock. In connection with the approval of
the April 2008 stock repurchase program, the April 2007 stock repurchase program was terminated and the remaining authorized amount of $69.6 million under the April 2007 stock repurchase program was canceled. As of November 30, 2009, we had
$89.8 million available for purchases under the April 2008 stock repurchase program.

All repurchased shares of common stock
have been retired. The following table summarizes the activities under the stock repurchase programs for the periods indicated (in thousands, except per share data):



|                          |  |                         |         |      |   |         |  |   |        
|------------------------- |  | ----------------------- | ------- | ---- | - | ------- |  | - | -------
|                          |  | Year Ended November 30,
|                          |  | 2009                    |         | 2008 |   | 2007   
|Cash used for repurchases |  | $                       | 106,447 |      | $ | 148,989 |  | $ | 226,932
|                          |  |                         |         |      |   |         |  |   |        
|Shares repurchased        |  |                         | 12,928  |      |   | 21,271  |  |   | 25,575 
|                          |  |                         |         |      |   |         |  |   |        
|Average price per share   |  | $                       | 8.23    |      | $ | 7.00    |  | $ | 8.87   
|                          |  |                         |         |      |   |         |  |   |        

In connection with the stock repurchase activities
during fiscal years 2009, 2008, and 2007 we classified $47.9 million, $56.5 million, and $49.9 million, respectively, of the excess purchase price over the par value of our common stock to retained earnings and $58.5 million, $92.5 million, and
$177.0 million, respectively, to additional paid-in capital. From December 1, 2009 up to January 22, 2010, we have repurchased approximately 2.6 million shares of our outstanding common stock at an average price of $9.50 per share pursuant to the
April 2008 stock repurchase program.



F-32



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



15.    Stock Benefit Plans and Stock-Based Compensation

Stock Benefit Plans

2008 Equity Incentive Plan (the 2008 Plan).On August 1, 2008, the 2008 Plan replaced the 1996 Stock Option Plan and the 1998 Director Option Plan. As of November 30, 2009, there were
11.2 million shares available for grant under the 2008 Plan and 3.5 million shares underlying stock options and awards outstanding under the 2008 Plan.

1996 Stock Option Plan (the 1996 Plan).    On August 1, 2008, the 1996 Plan was retired and replaced with the 2008 Plan. As of November 30, 2009, there
were no shares available for grant and 28.5 million underlying stock options and awards outstanding under the 1996 Plan.

Stock options granted under the 2008 and 1996 Plans may be either incentive stock options or nonqualified stock options. Incentive stock options may be granted only to employees (including officers and directors who are employees).
Nonqualified stock options may be granted to our employees and consultants. Stock options are generally granted at fair market value on the date of grant and generally vest over four years. Stock options granted from the 1996 Plan prior to
December 1, 2005 generally have a contractual term of ten years from the date of grant, and stock options granted from the 1996 Plan on or after December 1, 2005 and stock options granted from the 2008 Plan, have a contractual term of
seven years from the date of grant.

In addition to stock options, we issue restricted stock or restricted stock units to our
employees (including officers and directors who are employees). Shares of restricted stock are issued at the time of grant, but held in escrow until they are vested. The recipient of restricted stock becomes the owner of record of the stock
immediately upon grant, subject to certain restrictions. The balance of unvested restricted stock will be forfeited and automatically transferred back to us at no cost upon the termination of the recipients employment. Upon vesting of
restricted stock, the recipient has the option to settle minimum withholding taxes by electing to have us withhold otherwise deliverable shares having a fair market value equal to the required tax obligations (net-settlement). The
net-settlement shares are then immediately cancelled and retired. As vesting of restricted stock units occur, common stock is issued. The recipient of restricted stock units does not acquire any rights as a stockholder until the restricted stock
units are settled upon vesting and the recipient actually receives shares of our common stock.

Our stock option agreements
and stock award agreements generally provide for partial accelerated vesting if there is a change in control of us. We have entered into an employment agreement with our CEO that provides for varying levels of accelerated vesting upon the
occurrence of certain events. In addition, we have a change in control and severance plan that provides certain of our employees with partial accelerated vesting in the event that their employment is terminated within twelve months of a change in
control of TIBCO.

1998 Director Option Plan (the Director Plan).    In February 1998,
we adopted the Director Plan. On August 1, 2008, the Director Plan was retired and replaced by the 2008 Plan. As of November 30, 2009, no shares were available for grant and approximately 1.2 million shares underlying stock options
were outstanding under the Director Plan.

Insightful Corporation Amended and Restated 2001 Stock Option and
Incentive Plan (the Insightful Plan).In September 2008, we assumed the Insightful Plan in connection with our acquisition of Insightful. At the date of acquisition, all options of Insightful common
stock that were outstanding under the Insightful Plan were converted, according to an exchange ratio, into options of our common stock with terms and conditionsequivalent to those applicable at the time of conversion. As of November 30,
2009, 0.9 million shares were



F-33



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



available for grant and approximately 0.1 million shares underlying stock options and awards were outstanding under the Insightful Plan.

Talarian Stock Option Plans (the Talarian Plans).    In April 2003, we assumed all of the Talarian
Plans in connection with our acquisition of Talarian. At the date of acquisition, all outstanding options of Talarian common stock were converted, according to an exchange ratio, into options of our common stock with terms and conditions equivalent
to those applicable at the time of conversion. As of November 30, 2009, there were no shares reserved for grant and approximately 23,000 shares underlying options outstanding under the Talarian Plans.

2000 Extensibility Stock Option Plan (the Extensibility Plan).    In 2000, we assumed the
Extensibility Plan in connection with options assumed in our acquisition of Extensibility. Extensibility employees who continued service with us were granted options with terms and conditions equivalent to those applicable at the date of
acquisition. As of November 30, 2009, there were no shares reserved for grant and approximately 23,000 shares underlying options outstanding under the Extensibility Plan.

2008 Employee Stock Purchase Plan (the 2008 ESPP).    On August 1, 2008, we adopted the 2008
ESPP replacing the previous Employee Stock Purchase Program (the ESPP) pursuant to the 1996 Plan. As of November 30, 2009, approximately 9.5 million shares were reserved for future issuance under the 2008 ESPP and we had
issued approximately 0.5 million shares under the 2008 ESPP.

Employees are generally eligible to participate in the 2008
ESPP if they are employed by us for more than 20 hours per week and more than five months in a calendar year and are not (and would not become as a result of being granted an option under the 2008 ESPP) 5% stockholders of the Company. Certain
of our international employees are also eligible to participate. Under the 2008 ESPP, eligible employees may select a rate of payroll deduction from 1% to 10% of their eligible compensation subject to certain maximum purchase limitations. Under the
2008 ESPP, participants are entitled to purchase shares at 85% of the lesser of the fair market value of our common stock on either the first or last trading day of each six-month offering period. Participants may contribute a maximum amount of
$2,500 per offering period and no contribution percentage changes are allowed during an offering period.

We issued
approximately 0.5 million shares, 0.5 million shares and 0.4 million shares for $2.4 million, $3.6 million and $2.9 million, respectively, in employee contributions for the fiscal years 2009, 2008 and 2007, respectively, under the
employee stock purchase plans.

2009 Deferred Compensation Plan (the 2009 DCP).    On
February 20, 2009, we adopted the 2009 DCP. Pursuant to the 2009 DCP, eligible participants may elect to defer certain cash compensation into restricted stock units in accordance with the terms of the 2009 DCP. The restricted stock units will
be settled in shares of our common stock at the end of the elected deferral period except in certain situations as provided in the 2009 DPC. As of November 30, 2009, approximately 996,422 million shares of our common stock remained
available for issuance under the 2009 DCP.



F-34



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



Stock Option Activity

The summary of stock option activity in fiscal years 2009, 2008 and 2007 is presented below (in thousands, except per share data):



|                                                 |  |                                  |   |  |                               |      |                                                 |      |                         |   |       
|------------------------------------------------ |  | -------------------------------- | - |  | ----------------------------- | ---- | ----------------------------------------------- | ---- | ----------------------- | - | ------
|Stock Options                                    |  | Number ofSharesUnderlyingOptions |   |  | Weighted-AverageExercisePrice |      | Weighted-AverageRemainingContractualTerm (year) |      | AggregateIntrinsicValue
|Outstanding at November 30, 2006                 |  | 38,461                           |   |  | $                             | 8.09 |                                                 |      |                         |   |       
|Granted                                          |  | 5,200                            |   |  |                               | 7.90 |                                                 |      |                         |   |       
|Exercised                                        |  | (3,994                           | ) |  |                               | 5.70 |                                                 |      |                         |   |       
|Forfeited or expired                             |  | (2,029                           | ) |  |                               | 8.92 |                                                 |      |                         |   |       
|                                                 |  |                                  |   |  |                               |      |                                                 |      |                         |   |       
|Outstanding at November 30, 2007                 |  | 37,638                           |   |  |                               | 8.27 |                                                 |      |                         |   |       
|Assumed in acquisitions                          |  | 515                              |   |  |                               | 8.85 |                                                 |      |                         |   |       
|Granted                                          |  | 3,037                            |   |  |                               | 7.67 |                                                 |      |                         |   |       
|Exercised                                        |  | (2,059                           | ) |  |                               | 4.20 |                                                 |      |                         |   |       
|Forfeited or expired                             |  | (2,841                           | ) |  |                               | 9.77 |                                                 |      |                         |   |       
|                                                 |  |                                  |   |  |                               |      |                                                 |      |                         |   |       
|Outstanding at November 30, 2008                 |  | 36,290                           |   |  |                               | 8.34 |                                                 |      |                         |   |       
|Granted                                          |  | 2,064                            |   |  |                               | 7.28 |                                                 |      |                         |   |       
|Exercised                                        |  | (4,290                           | ) |  |                               | 6.05 |                                                 |      |                         |   |       
|Forfeited or expired                             |  | (2,423                           | ) |  |                               | 9.21 |                                                 |      |                         |   |       
|                                                 |  |                                  |   |  |                               |      |                                                 |      |                         |   |       
|Outstanding at November 30, 2009                 |  | 31,641                           |   |  | $                             | 8.52 |                                                 | 3.86 |                         | $ | 34,997
|                                                 |  |                                  |   |  |                               |      |                                                 |      |                         |   |       
|Vested and expected to vest at November 30, 2009 |  | 30,799                           |   |  | $                             | 8.54 |                                                 | 3.77 |                         | $ | 34,124
|                                                 |  |                                  |   |  |                               |      |                                                 |      |                         |   |       
|Exercisable at November 30, 2009                 |  | 26,374                           |   |  | $                             | 8.67 |                                                 | 3.53 |                         | $ | 29,859
|                                                 |  |                                  |   |  |                               |      |                                                 |      |                         |   |       

The intrinsic value of exercised stock options is calculated based on the difference
between the exercise price and the quoted market price of our common stock as of the close of the exercise date. The total intrinsic value of stock options exercised in fiscal years 2009, 2008 and 2007 was $10.5 million, $7.1 million and $13.3
million, respectively. Upon the exercise of stock options, we issue common stock from our authorized shares. As of November 30, 2009, total unamortized stock-based compensation cost related to unvested stock options was $13.5 million, with a
weighted-average remaining recognition period of 2.39 years. Total fair value of stock options vested and expensed in fiscal year 2009, 2008 and 2007 was $16.2 million, $15.5 million and $13.6 million, respectively, net of taxes.

The total realized tax benefits attributable to stock options exercised and vesting of stock awards were $21.6 million, $27.0 million and
$19.5 million in fiscal year 2009, 2008 and 2007 respectively. The gross excess tax benefits from stock-based compensation were $17.0 million, $24.7 million and $18.0 million in the fiscal years 2009, 2008, and 2007, respectively, as reported on the
Consolidated Statements of Cash Flows in financing activities. The excess tax benefits represent the reduction in income taxes otherwise payable during the period which are attributable to the actual gross tax benefits in excess of the expected tax
benefits for stock options exercised in current and prior periods.



F-35



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



All vested stock options are exercisable. The following table summarizes information
about stock options outstanding and exercisable as of November 30, 2009 (in thousands, except number of years and per share data):



|                         |  |                                  |  |                                                  |  |                                         |       |                                  |        |                                         |   |      
|------------------------ |  | -------------------------------- |  | ------------------------------------------------ |  | --------------------------------------- | ----- | -------------------------------- | ------ | --------------------------------------- | - | -----
|                         |  | Options Outstanding              |  | Options Exercisable                             
|Range of Exercise Prices |  | Number ofSharesUnderlyingOptions |  | Weighted-AverageRemainingContractual Life(Years) |  | Weighted-AverageExercise Priceper Share |       | Number ofSharesUnderlyingOptions |        | Weighted-AverageExercise Priceper Share
|$ 0.96 to $ 5.99         |  | 4,180                            |  | 3.76                                             |  | $                                       | 5.27  |                                  | 3,951  |                                         | $ | 5.30 
|6.02 to    6.63          |  | 3,739                            |  | 5.14                                             |  |                                         | 6.56  |                                  | 3,576  |                                         |   | 6.57 
|6.68 to    7.07          |  | 1,646                            |  | 5.93                                             |  |                                         | 6.95  |                                  | 537    |                                         |   | 6.98 
|7.08 to    7.30          |  | 4,604                            |  | 4.23                                             |  |                                         | 7.29  |                                  | 4,155  |                                         |   | 7.30 
|7.31 to    7.95          |  | 3,313                            |  | 4.93                                             |  |                                         | 7.76  |                                  | 1,730  |                                         |   | 7.76 
|7.98 to    8.59          |  | 3,846                            |  | 2.58                                             |  |                                         | 8.10  |                                  | 3,673  |                                         |   | 8.10 
|8.60 to  11.42           |  | 3,861                            |  | 4.62                                             |  |                                         | 9.08  |                                  | 2,301  |                                         |   | 9.11 
|11.44 to  11.97          |  | 4,688                            |  | 2.06                                             |  |                                         | 11.76 |                                  | 4,688  |                                         |   | 11.76
|12.00 to  71.81          |  | 1,764                            |  | 1.76                                             |  |                                         | 17.53 |                                  | 1,763  |                                         |   | 17.54
|                         |  |                                  |  |                                                  |  |                                         |       |                                  |        |                                         |   |      
|                         |  | 31,641                           |  | 3.82                                             |  | $                                       | 8.52  |                                  | 26,374 |                                         | $ | 8.67 
|                         |  |                                  |  |                                                  |  |                                         |       |                                  |        |                                         |   |      

Stock Awards Activities

Our nonvested stock awards are comprised of restricted stock and restricted stock units. A summary of the status for nonvested stock awards
as of November 30, 2009, and activities during fiscal years 2009, 2008 and 2007, is presented as follows (in thousands, except per share data):



|                               |  |                 |   |  |                      |   |  |                                       |   |  |                                      |     
|------------------------------ |  | --------------- | - |  | -------------------- | - |  | ------------------------------------- | - |  | ------------------------------------ | ----
|Nonvested Stock Awards         |  | RestrictedStock |   |  | RestrictedStockUnits |   |  | Total ofShares NumberUnderlyingAwards |   |  | Weighted-AverageGrant-DateFair Value
|Nonvested at November 30, 2006 |  | 1,177           |   |  | 319                  |   |  | 1,496                                 |   |  | $                                    | 7.34
|Granted                        |  | 1,321           |   |  | 396                  |   |  | 1,717                                 |   |  |                                      | 8.89
|Vested                         |  | (271            | ) |  | (74                  | ) |  | (345                                  | ) |  |                                      | 7.34
|Forfeited                      |  | (185            | ) |  | (63                  | ) |  | (248                                  | ) |  |                                      | 7.94
|                               |  |                 |   |  |                      |   |  |                                       |   |  |                                      |     
|Nonvested at November 30, 2007 |  | 2,042           |   |  | 578                  |   |  | 2,620                                 |   |  |                                      | 8.28
|Granted                        |  | 2,058           |   |  | 412                  |   |  | 2,470                                 |   |  |                                      | 7.76
|Vested                         |  | (537            | ) |  | (153                 | ) |  | (690                                  | ) |  |                                      | 8.18
|Forfeited                      |  | (200            | ) |  | (75                  | ) |  | (275                                  | ) |  |                                      | 8.17
|                               |  |                 |   |  |                      |   |  |                                       |   |  |                                      |     
|Nonvested at November 30, 2008 |  | 3,363           |   |  | 762                  |   |  | 4,125                                 |   |  |                                      | 7.99
|Granted                        |  | 2,090           |   |  | 1,396                |   |  | 3,486                                 |   |  |                                      | 6.67
|Vested                         |  | (940            | ) |  | (220                 | ) |  | (1,160                                | ) |  |                                      | 6.98
|Forfeited                      |  | (432            | ) |  | (136                 | ) |  | (568                                  | ) |  |                                      | 7.96
|                               |  |                 |   |  |                      |   |  |                                       |   |  |                                      |     
|Nonvested at November 30, 2009 |  | 4,081           |   |  | 1,802                |   |  | 5,883                                 |   |  | $                                    | 7.41
|                               |  |                 |   |  |                      |   |  |                                       |   |  |                                      |     

We granted nonvested stock awards at no cost to recipients during fiscal years 2009,
2008, and 2007. As of November 30, 2009, there was $29.3 million of total unrecognized compensation cost related to nonvested stock awards. That cost is expected to be recognized generally on a straight-line basis as the shares vest over three
to four years (the weighted-average recognition period of 2.60 years). The total fair value of shares vested pursuant to stock awards during fiscal year 2009, 2008, and 2007 were $4.5 million, $5.6 million, and $2.5 million, respectively.



F-36



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



Stock-Based Compensation

Stock-based compensation expense in fiscal year 2009, 2008 and 2007 were $23.5 million, $21.0 million, and $17.6 million, respectively, which
consisted primarily of stock-based compensation expense related to employee stock options recognized. The tax effect on employee stock-based compensation in fiscal years 2009, 2008 and 2007 was $7.4 million, $5.5 million and $4.0 million,
respectively. We did not capitalize any stock-based compensation in any of the fiscal periods reported.

We started granting
restricted stock and restricted stock units to employees in fiscal year 2006. Approximately $12.8 million, $8.5 million, and $4.3 million of employee stock-based compensation for the fiscal years 2009, 2008, and 2007, respectively, were related to
restricted stock and restricted stock units.

We recognized stock-based compensation cost associated with our employee stock
purchase programs on a straight-line basis over each six-month offering period. Employee stock-based compensation associated with our employee stock purchase programs for the fiscal year 2009, 2008 and 2007 was approximately $1.0 million, $1.2
million, and $0.9 million, respectively.

Assumptions for Estimating Fair Value of Stock-Based Awards

We selected the Black-Scholes option pricing model as the most appropriate model for determining the estimated fair value for stock-based
awards including stock options and employee stock purchase plans. The use of the Black-Scholes model requires the use of extensive actual employee exercise behavior data and the use of a number of complex assumptions including expected volatility,
risk-free interest rate and expected dividends. The following table summarizes the assumptions used to value options granted in the respective periods:



|                                                   |  |                         |           |   |      |   |           |      |  |   |           |  
|-------------------------------------------------- |  | ----------------------- | --------- | - | ---- | - | --------- | ---- |  | - | --------- | -
|                                                   |  | Year Ended November 30, |          
|                                                   |  | 2009                    |           |   | 2008 |   |           | 2007 | 
|Stock Option grants:                               |  |                         |           |   |      |   |           |      |  |   |           |  
|Expected term of stock options (years)             |  |                         | 4.7  5.1 |   |      |   | 4.6  4.9 |      |  |   | 4.4  4.6 |  
|Risk-free interest rate                            |  |                         | 1.7  2.6 | % |      |   | 2.6  3.4 | %    |  |   | 3.8  4.7 | %
|Volatility                                         |  |                         | 48  56   | % |      |   | 45  48   | %    |  |   | 39        | %
|Weighted-average grant-date fair value (per share) |  | $                       | 3.42      |   |      | $ | 3.40      |      |  | $ | 3.92      |  
|Employee stock purchase plans:                     |  |                         |           |   |      |   |           |      |  |   |           |  
|Expected term of ESPP (years)                      |  |                         | 0.5       |   |      |   | 0.5       |      |  |   | 0.5       |  
|Risk-free interest rate                            |  |                         | 0.3  0.4 | % |      |   | 1.9  2.2 | %    |  |   | 5.0  5.2 | %
|Volatility                                         |  |                         | 51  71   | % |      |   | 42  54   | %    |  |   | 32  34   | %
|Weighted-average grant-date fair value (per share) |  | $                       | 2.12      |   |      | $ | 2.34      |      |  | $ | 3.92      |  

We estimated the volatility of our stock using historical volatility, as well as the
implied volatility in market-traded options on our common stock. We determined that a blend of implied volatility and historical volatility is more reflective of market conditions and a better indicator of expected volatility than using purely
historical volatility. We will continue to monitor these and other relevant factors used to measure expected volatility for future stock option grants.

The expected term of employee stock options represents the weighted-average period that the stock options are expected to remain outstanding. We derived the expected term assumption based on our
historical settlement experience, while giving consideration to stock options that have life cycles less than the contractual terms and vesting schedules.



F-37



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



The risk-free interest rate assumption is based upon observed interest rates appropriate
for the expected term of our employee stock options. The dividend yield assumption is based on our history and expectation of dividend payouts. We have never declared or paid any cash dividends on our common stock, and we do not anticipate paying
any cash dividends in the foreseeable future.

As stock-based compensation expense recognized in our Consolidated Statement of
Operations is based on awards ultimately expected to vest, the amount has been reduced for estimated forfeitures. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those
estimates. Forfeitures were estimated based on our historical experience.

The fair value of restricted stock and restricted
stock units is the grant date closing price of our common stock. We expense the cost of the restricted stock and restricted stock units ratably over the period during which the restrictions lapse, and adjust for estimated forfeitures.

16.    Employee 401(k) Plan

Our employee savings and retirement plan is qualified under Section 401 of the United States Internal Revenue Code of 1986, as amended. Employees may elect to reduce their current compensation by up
to the statutory prescribed annual limit and have the amount of such reduction contributed to the 401(k) Plan. We provide a 100% match to employee contributions up to 4% of an employees base pay and an additional 25% on employee contributions
of the next 2% of base pay. Our matching contributions to the 401(k) Plan totaled $5.1 million, $5.2 million and $4.8 million in fiscal years 2009, 2008 and 2007, respectively.

17.    Comprehensive Income (Loss)

Our comprehensive
income (loss) includes net income and other comprehensive income (loss), which consists of unrealized gains and losses on available-for-sale securities and cumulative translation adjustments.

Total comprehensive income (loss) in fiscal years 2009, 2008 and 2007 are presented in the Consolidated Statements of Stockholders
Equity and Comprehensive Income (Loss). Total Accumulated Other Comprehensive Income (Loss) is displayed as a separate component of Stockholders Equity in the accompanying Consolidated Balance Sheets. The balances of each component of
Accumulated Other Comprehensive Income (Loss), net of taxes, consist of the following (in thousands):



|                                                        |  |              |         |   |      |   |         |      |  |   |       
|------------------------------------------------------- |  | ------------ | ------- | - | ---- | - | ------- | ---- |  | - | ------
|                                                        |  | November 30,
|                                                        |  | 2009         |         |   | 2008 |   |         | 2007
|Cumulative translation adjustment, net of tax           |  | $            | (16,386 | ) |      | $ | (44,451 | )    |  | $ | 32,636
|Unrealized gain (loss) on available-for-sale securities |  |              | (27     | ) |      |   | 26      |      |  |   | 357   
|                                                        |  |              |         |   |      |   |         |      |  |   |       
|Total accumulated other comprehensive income (loss)     |  | $            | (16,413 | ) |      | $ | (44,425 | )    |  | $ | 32,993
|                                                        |  |              |         |   |      |   |         |      |  |   |       

As of November 30, 2009, 2008 and 2007, cumulative translation adjustment
included total accumulated tax effects of $7.6 million, $10.7 million and $(8.9) million, respectively.

18.    Minority Interest

In the first quarter of fiscal year 2007, we established a joint
venture in South Africa, TS Innovations Limited (Innovations), with a local South Africa corporation, to assist with our sales efforts as well as to provide consulting services and training to our customers in the Sub-Saharan Africa
region. As of November 30,



F-38



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



2009 and 2008, Innovations had total assets of $3.2 million and $0.9 million, respectively. For the years ended November 30, 2009, 2008, and 2007, Innovations had total revenues of $7.5
million, $3.9 million and $3.5 million, respectively. As of November 30, 2009, we owned a 74.9% interest in the joint venture. Because of this majority interest, our Consolidated Financial Statements include the balance sheets, results of
operations and cash flows of Innovations, net of intercompany charges. We therefore eliminated 25.1% of financial results that pertain to the minority interest; the eliminated amount was reported as a separate line on our Consolidated Statements of
Operations and Balance Sheets.

19.    Income Taxes

Income before provision for income taxes consisted of the following (in thousands):



|              |  |                         |        |      |   |        |  |   |       
|------------- |  | ----------------------- | ------ | ---- | - | ------ |  | - | ------
|              |  | Year Ended November 30,
|              |  | 2009                    |        | 2008 |   | 2007  
|United States |  | $                       | 78,928 |      | $ | 45,241 |  | $ | 52,928
|International |  |                         | 10,689 |      |   | 25,589 |  |   | 24,471
|              |  |                         |        |      |   |        |  |   |       
|              |  | $                       | 89,617 |      | $ | 70,830 |  | $ | 77,399
|              |  |                         |        |      |   |        |  |   |       

Significant components of the provision for (benefit from) income taxes are as
follows (in thousands):



|                           |  |                         |         |   |      |   |         |      |  |   |        |  
|-------------------------- |  | ----------------------- | ------- | - | ---- | - | ------- | ---- |  | - | ------ | -
|                           |  | Year Ended November 30, |        
|                           |  | 2009                    |         |   | 2008 |   |         | 2007 | 
|Federal:                   |  |                         |         |   |      |   |         |      |  |   |        |  
|Current                    |  | $                       | 23,547  |   |      | $ | 20,497  |      |  | $ | 18,971 |  
|Deferred                   |  |                         | (992    | ) |      |   | (12,376 | )    |  |   | (1,887 | )
|                           |  |                         |         |   |      |   |         |      |  |   |        |  
|                           |  |                         | 22,555  |   |      |   | 8,121   |      |  |   | 17,084 |  
|                           |  |                         |         |   |      |   |         |      |  |   |        |  
|State:                     |  |                         |         |   |      |   |         |      |  |   |        |  
|Current                    |  |                         | 2,934   |   |      |   | 3,711   |      |  |   | 1,756  |  
|Deferred                   |  |                         | (1,050  | ) |      |   | (2,880  | )    |  |   | (34    | )
|                           |  |                         |         |   |      |   |         |      |  |   |        |  
|                           |  |                         | 1,884   |   |      |   | 831     |      |  |   | 1,722  |  
|                           |  |                         |         |   |      |   |         |      |  |   |        |  
|Foreign:                   |  |                         |         |   |      |   |         |      |  |   |        |  
|Current                    |  |                         | 13,246  |   |      |   | 20,300  |      |  |   | 10,751 |  
|Deferred                   |  |                         | (10,588 | ) |      |   | (10,938 | )    |  |   | (4,156 | )
|                           |  |                         |         |   |      |   |         |      |  |   |        |  
|                           |  |                         | 2,658   |   |      |   | 9,362   |      |  |   | 6,595  |  
|                           |  |                         |         |   |      |   |         |      |  |   |        |  
|Provision for income taxes |  | $                       | 27,097  |   |      | $ | 18,314  |      |  | $ | 25,401 |  
|                           |  |                         |         |   |      |   |         |      |  |   |        |  



F-39



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



We paid income taxes of $18.6 million, $12.6 million and $12.1 million in fiscal years
2009, 2008 and 2007, respectively.

The provision for income taxes was at rates other than the United States Federal statutory
tax rate for the following reasons:



|                                       |  |                         |   |  |      |   |  |      |  
|-------------------------------------- |  | ----------------------- | - |  | ---- | - |  | ---- | -
|                                       |  | Year Ended November 30, |  
|                                       |  | 2009                    |   |  | 2008 |   |  | 2007 |  
|U.S. Federal statutory rate            |  | 35.0                    | % |  | 35.0 | % |  | 35.0 | %
|State taxes                            |  | 3.2                     |   |  | 1.2  |   |  | 1.6  |  
|Research and development credits       |  | (1.9                    | ) |  | (2.2 | ) |  | (2.7 | )
|Goodwill and intangibles               |  | (0.4                    | ) |  | (0.5 | ) |  | 0.3  |  
|Stock option compensation              |  | 1.1                     |   |  | 3.1  |   |  | 2.9  |  
|Foreign income taxed at different rate |  | (6.6                    | ) |  | (7.7 | ) |  | (3.7 | )
|Change in valuation allowance          |  | 0.8                     |   |  | (1.7 | ) |  | (2.1 | )
|Meals and entertainment                |  | 0.5                     |   |  | 0.8  |   |  | 0.7  |  
|Extraterritorial income exclusion      |  |                        |   |  |     |   |  | (0.1 | )
|Other                                  |  | (1.5                    | ) |  | (2.1 | ) |  | 0.9  |  
|                                       |  |                         |   |  |      |   |  |      |  
|Provision for income taxes             |  | 30.2                    | % |  | 25.9 | % |  | 32.8 | %
|                                       |  |                         |   |  |      |   |  |      |  

U.S. income taxes and foreign withholding taxes have not been provided for on a
cumulative total of $42.5 million of undistributed earnings for certain non-U.S. subsidiaries. With the exception of our subsidiaries in the United Kingdom and Japan, net undistributed earnings of our foreign subsidiaries are generally considered to
be indefinitely reinvested, and accordingly, no provision for U.S. income taxes has been provided thereon. We have sufficient cash reserves in the U.S. and do not require repatriation of our foreign earnings. We intend to use the undistributed
earnings for acquisitions, local operations expansion and to meet local operating expense requirements. Upon distribution of these earnings in the form of dividends or otherwise, we will be subject to U.S. income taxes net of available foreign tax
credits associated with these earnings. Determination of the amount of unrecognized deferred tax liability related to these earnings is not practicable.



F-40



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



The components of deferred tax assets (liabilities) are as follows (in thousands):



|                                                   |  |              |         |   |      |   |         |  
|-------------------------------------------------- |  | ------------ | ------- | - | ---- | - | ------- | -
|                                                   |  | November 30, |        
|                                                   |  | 2009         |         |   | 2008 |  
|Deferred tax assets:                               |  |              |         |   |      |   |         |  
|Net operating loss carryforwards                   |  | $            | 36,302  |   |      | $ | 27,195  |  
|Reserves, accruals and foreign related items       |  |              | 24,546  |   |      |   | 23,883  |  
|Credit carryforwards                               |  |              | 15,918  |   |      |   | 13,165  |  
|Depreciation and amortization                      |  |              | 16,952  |   |      |   | 15,194  |  
|Unrealized losses on investments                   |  |              | 5,402   |   |      |   | 5,274   |  
|Deferred revenue                                   |  |              | 6,891   |   |      |   | 5,308   |  
|Translation gains/losses                           |  |              | 1,364   |   |      |   | 8,817   |  
|Stock compensation expense                         |  |              | 11,618  |   |      |   | 8,105   |  
|Other                                              |  |              | 1,962   |   |      |   | 2,069   |  
|                                                   |  |              |         |   |      |   |         |  
|                                                   |  |              | 120,955 |   |      |   | 109,010 |  
|Deferred tax liabilities:                          |  |              |         |   |      |   |         |  
|Intangible assets                                  |  |              | (24,664 | ) |      |   | (22,100 | )
|Pre-acquisition receivableSpotfire                |  |              | (1,135  | ) |      |   | (4,748  | )
|Other                                              |  |              | (422    | ) |      |   | (405    | )
|                                                   |  |              |         |   |      |   |         |  
|                                                   |  |              | (26,221 | ) |      |   | (27,253 | )
|                                                   |  |              |         |   |      |   |         |  
|Net deferred tax assets before valuation allowance |  |              | 94,734  |   |      |   | 81,757  |  
|Valuation allowance                                |  |              | (8,679  | ) |      |   | (7,945  | )
|                                                   |  |              |         |   |      |   |         |  
|Net deferred tax assets                            |  | $            | 86,055  |   |      | $ | 73,812  |  
|                                                   |  |              |         |   |      |   |         |  

In connection with the acquisition of DataSynapse, we have recorded current deferred
tax assets of $0.7 million and long term deferred tax assets of $3.7 million with a corresponding adjustment to goodwill. These deferred taxes were primarily related to the acquired tangible and intangible assets, deferred revenue, accounts
receivable, accrued expenses and certain tax attributes of DataSynapse.

In connection with the acquisition of Insightful in
fiscal year 2008, we have recorded current deferred tax assets of $0.6 million, current deferred tax liabilities of $0.1 million, long-term deferred tax assets of $3.2 million and long-term deferred tax liabilities of $0.4 million; with a
corresponding adjustment to goodwill. These deferred taxes were related to the acquired tangible and intangible assets, deferred revenue and certain tax attributes of Insightful.

In connection with the acquisition of Spotfire in fiscal year 2007, we recorded current deferred tax assets of $4.1 million, current
deferred tax liabilities of $17.3 million, long-term deferred tax assets of $11.9 million and long-term deferred tax liabilities of $18.7 million with a corresponding adjustment to goodwill. These deferred taxes were related to the acquired tangible
and intangible assets, deferred revenue, pre-acquisition receivable and certain tax attributes of Spotfire. The IPR&D of $1.6 million that was expensed in fiscal year 2007 is not deductible for income tax purposes. This resulted in an
unfavorable effective tax rate impact of 0.8% for the fiscal year ended November 30, 2007.



F-41



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



We assess the likelihood that we will be able to recover our deferred tax assets. We
consider all available evidence, both positive and negative, including historical levels of income, expectations and risks associated with estimates of future taxable income and ongoing prudent and feasible tax planning strategies in assessing the
need for the valuation allowance. If it is not more likely than not that we will recover our deferred tax assets, we will increase our provision for taxes by recording a valuation allowance against the deferred tax assets that we estimate will not
ultimately be recoverable. The available positive evidence at November 30, 2009 included five years of historical operating profits and a projection of future income sufficient to realize most of our remaining deferred tax assets. We recorded a
valuation allowance of $0.7 million in fiscal year 2009, related to excess foreign tax credit. As of November 30, 2009, it was considered more likely than not that our deferred tax assets would be realized with the exception of certain
capital loss and foreign tax credit carryovers as we cannot forecast sufficient future capital gains or foreign source income to realize these deferred tax assets. The remaining valuation allowance of approximately $8.7 million as of
November 30, 2009 will result in an income tax benefit if and when we conclude it is more likely than not that the related deferred tax assets will be realized.

As of November 30, 2009, we believed that the amount of the deferred tax assets recorded on our balance sheet would ultimately be recovered. However, should there be a change in our ability to
recover our deferred tax assets, our tax provision would increase in the period in which we determine that it is more likely than not that we cannot recover our deferred tax assets. If we have to re-establish a full valuation allowance against our
deferred tax assets it would result in an increase of $38.0 million to income tax expense.

We have elected to track the
portion of our federal and state net operating loss and tax credit carryforwards attributable to stock option benefits in a separate memo account. Therefore, these amounts are no longer included in our gross or net deferred tax assets. The benefit
of these net operating loss and tax credit carryforwards will only be recorded to equity when they reduce cash taxes payable. As a result, we recorded a net change of $20.3 million and $41.6 million in fiscal year 2009 and 2008, respectively, in the
memo account resulting from the utilization of net operating loss related to stock option benefits.

Our income taxes payable
for federal purposes have been reduced by the tax benefits associated with the exercise of employee stock options during the fiscal year and utilization of net operating loss carryover applicable to both stock options and acquired entities. The
benefits applicable to stock options were credited directly to stockholders equity when realized and amounted to $21.6 million and $27.0 million for fiscal years 2009 and 2008, respectively.

As of November 30, 2009, our federal and state net operating loss carryforwards for income tax purposes were $243.6 million and $89.7
million, respectively, which expire through 2028. As of November 30, 2009, our federal and state tax credit carryforwards for income tax purposes were $52.9 million and $29.7 million, respectively. The federal tax credit carryforwards expire in
2029 and the state tax credit can be carried forward indefinitely.

As of November 30, 2009, our federal and state net
operating loss carryforwards being accounted for in the memo account were $115.6 million and $25.8 million, respectively. As of November 30, 2009, our federal and state tax credit carryforwards being accounted for in the memo account were $48.6
million and $19.5 million, respectively.

In the event of a change in ownership, as defined under federal and state tax laws,
our net operating loss and tax credit carryforwards may be subject to annual limitations. The annual limitations may result in the expiration of the net operating loss and tax credit carryforwards before utilization.



F-42



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



On December 1, 2007, we adopted the accounting for uncertainty in income taxes
which requires companies to determine whether it is more likely than not that a tax position will be sustained upon examination by the appropriate taxing authorities before any part of the benefit can be recorded in the financial statements. The
standards also provides guidance on de-recognition, classification, accounting in interim periods and disclosure requirements for tax contingencies. In addition, we have applied the standards in determining whether a tax position is effectively
settled for the purpose of recognizing previously unrecognized tax benefits.

As a result of the adoption of the accounting
for uncertainty in income taxes, we reduced the liability for net unrecognized tax benefits by $0.6 million and accounted for this as a cumulative-effect adjustment recorded as an increase to the December 1, 2007 balance of retained earnings.
The total amount of gross unrecognized tax benefit as of the date of adoption was $33.8 million, of which $11.5 million would affect the effective tax rate if realized. We historically classified unrecognized tax benefits in current income taxes
payable. In implementing the guidance, we have reclassified $6.8 million from current income taxes payable to long-term income tax liabilities. We have also grossed-up our long-term income tax liabilities by $5.4 million with a corresponding
increase to our deferred tax assets.

A reconciliation of the unrecognized tax benefits for the fiscal years ended
November 30, 2009 and 2008 are as follows (in thousands):



|                                                             |  |              |        |   |      |   |        |  
|------------------------------------------------------------ |  | ------------ | ------ | - | ---- | - | ------ | -
|                                                             |  | November 30, |       
|                                                             |  | 2009         |        |   | 2008 |  
|Gross unrecognized tax benefits balance at beginning of year |  | $            | 35,433 |   |      | $ | 33,788 |  
|Increases for tax positions of current fiscal year           |  |              | 2,512  |   |      |   | 1,598  |  
|Increases for tax positions of prior fiscal years            |  |              | 1,398  |   |      |   | 2,144  |  
|Decreases for tax positions of prior fiscal years            |  |              | (651   | ) |      |   | (1,897 | )
|Lapse of statutes of limitation                              |  |              | (176   | ) |      |   | (200   | )
|                                                             |  |              |        |   |      |   |        |  
|Total gross unrecognized tax benefits balance at end of year |  |              | 38,516 |   |      |   | 35,433 |  
|Interest and penalties                                       |  |              | 1,416  |   |      |   | 1,162  |  
|                                                             |  |              |        |   |      |   |        |  
|Balance at end of year                                       |  | $            | 39,932 |   |      | $ | 36,595 |  
|                                                             |  |              |        |   |      |   |        |  

During fiscal year 2009, the amount of gross unrecognized tax benefits was increased
by approximately $3.1 million. The total amount of gross unrecognized tax benefits was $38.5 million as of November 30, 2009, of which $15.6 million would affect the effective tax rate if realized. We do not expect any significant changes to
the amount of unrecognized tax benefit within the next 12 months.

Upon adoption of authoritative guidance, we have elected to
include interest expense and penalties accrued on unrecognized tax benefits as a component of our income tax expense. This is consistent with our policy prior to the adoption of accounting for uncertainty in income taxes. As of November 30,
2008 and November 30, 2009, we had accrued interest and penalties related to uncertain tax positions of $1.2 million and $1.4 million, respectively.

We are subject to routine corporate income tax audits in the United States and foreign jurisdictions. The statute of limitations for our fiscal years 1994 through 2008 remains open for U.S. purposes. Most
foreign jurisdictions have statute of limitations that range from three to six years.

20.    Net Income Per Share

Basic net income per share is computed by dividing the net income available to common stockholders for the period by the
weighted average number of shares of common stock outstanding during the period less shares



F-43



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



of common stock subject to repurchase and nonvested stock awards. Diluted net income per share is computed by dividing the net income for the period by the weighted average number of shares of
common stock and potential shares of common stock outstanding during the period if their effect is dilutive. Certain potential dilutive securities were not included in computing net income per share because their effect was anti-dilutive.

We use the treasury stock method to calculate the weighted-average shares used in the diluted earnings per share. Under this
treasury stock method, the assumed proceeds calculation includes: (a) the actual proceeds to-be-received from the employee upon exercise, (b) the average unrecognized compensation cost during the period and (c) any tax benefits that
will be credited upon exercise to additional paid in capital. We determine whether our windfall pool of available excess tax benefits is sufficient to absorb the shortfall. Currently, we have determined that we have sufficient windfall pool
available.

The following table sets forth the computation of basic and diluted net income per share for the periods indicated
(in thousands, except per share data):



|                                                                                     |  |                         |         |      |   |         |  |   |        
|------------------------------------------------------------------------------------ |  | ----------------------- | ------- | ---- | - | ------- |  | - | -------
|                                                                                     |  | Year Ended November 30,
|                                                                                     |  | 2009                    |         | 2008 |   | 2007   
|Net income                                                                           |  | $                       | 62,302  |      | $ | 52,411  |  | $ | 51,888 
|                                                                                     |  |                         |         |      |   |         |  |   |        
|Weighted-average shares of common stock used to compute basic net income per share   |  |                         | 168,970 |      |   | 180,525 |  |   | 198,885
|Effect of dilutive common stock equivalents:                                         |  |                         |         |      |   |         |  |   |        
|Stock options to purchase common stock                                               |  |                         | 2,548   |      |   | 2,905   |  |   | 6,114  
|Restricted common stock awards                                                       |  |                         | 810     |      |   | 312     |  |   | 317    
|                                                                                     |  |                         |         |      |   |         |  |   |        
|Weighted-average shares of common stock used to compute diluted net income per share |  |                         | 172,328 |      |   | 183,742 |  |   | 205,316
|                                                                                     |  |                         |         |      |   |         |  |   |        
|Basic net income per share                                                           |  | $                       | 0.37    |      | $ | 0.29    |  | $ | 0.26   
|                                                                                     |  |                         |         |      |   |         |  |   |        
|Diluted net income per share                                                         |  | $                       | 0.36    |      |   | 0.29    |  | $ | 0.25   
|                                                                                     |  |                         |         |      |   |         |  |   |        

The following potential weighted-average common stock equivalents are not included in
the diluted net income per share calculation above, because their effect was anti-dilutive for the periods indicated (in thousands):



|                                             |  |                         |  |        |  |       
|-------------------------------------------- |  | ----------------------- |  | ------ |  | ------
|                                             |  | Year Ended November 30,
|                                             |  | 2009                    |  | 2008   |  | 2007  
|Stock options to purchase common stock       |  | 23,882                  |  | 24,725 |  | 16,124
|Restricted common stock awards               |  | 1,299                   |  | 1,267  |  | 109   
|                                             |  |                         |  |        |  |       
|Total anti-dilutive common stock equivalents |  | 25,181                  |  | 25,992 |  | 16,233
|                                             |  |                         |  |        |  |       

21.    Related Party Transactions

Bernard J. Bourigeaud, a former member of our Board of Directors, served until December 2007 as Chairman of the Management Board and CEO of
Atos Origin, a leading international IT services provider and one of our customers in fiscal year 2007. Total revenue received from Atos Origin for products and services delivered in the fiscal year ended November 30, 2007, was $1.0 million. We
believe that the products and



F-44



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



services provided to Atos Origin were on terms that were determined at arms length, and such terms were similar to terms offered to other customers.

22.    Segment Information

We operate our business in one operating segment: the development and marketing of a suite of infrastructure software. Our chief operating decision maker is our Chief Executive Officer, who reviews
financial information presented on a consolidated basis for purposes of making operating decisions and assessing financial performance.

Our total revenue by geographic region, based on the location at which each sale originated, is summarized as follows (in thousands):



|               |  |                         |         |      |   |         |  |   |        
|-------------- |  | ----------------------- | ------- | ---- | - | ------- |  | - | -------
|               |  | Year Ended November 30,
|               |  | 2009                    |         | 2008 |   | 2007   
|Americas:      |  |                         |         |      |   |         |  |   |        
|United States  |  | $                       | 279,226 |      | $ | 301,969 |  | $ | 267,415
|Other Americas |  |                         | 35,936  |      |   | 18,660  |  |   | 10,963 
|               |  |                         |         |      |   |         |  |   |        
|Total Americas |  |                         | 315,162 |      |   | 320,629 |  |   | 278,378
|               |  |                         |         |      |   |         |  |   |        
|EMEA:          |  |                         |         |      |   |         |  |   |        
|United Kingdom |  |                         | 62,426  |      |   | 74,230  |  |   | 81,084 
|Other EMEA     |  |                         | 194,562 |      |   | 185,960 |  |   | 152,375
|               |  |                         |         |      |   |         |  |   |        
|Total EMEA     |  |                         | 256,988 |      |   | 260,190 |  |   | 233,459
|               |  |                         |         |      |   |         |  |   |        
|APJ            |  |                         | 49,238  |      |   | 63,652  |  |   | 65,549 
|               |  |                         |         |      |   |         |  |   |        
|               |  | $                       | 621,388 |      | $ | 644,471 |  | $ | 577,386
|               |  |                         |         |      |   |         |  |   |        

Our license revenue in fiscal years 2009, 2008 and
2007 was derived from the following three product solutions: SOA, business optimization and BPM.



|                      |  |                        |   |  |      |   |  |      |  
|--------------------- |  | ---------------------- | - |  | ---- | - |  | ---- | -
|                      |  | Year EndedNovember 30, |  
|                      |  | 2009                   |   |  | 2008 |   |  | 2007 |  
|SOA                   |  | 62                     | % |  | 56   | % |  | 65   | %
|Business optimization |  | 25                     |   |  | 32   |   |  | 19   |  
|BPM                   |  | 13                     |   |  | 12   |   |  | 16   |  
|                      |  |                        |   |  |      |   |  |      |  
|Total license revenue |  | 100                    | % |  | 100  | % |  | 100  | %
|                      |  |                        |   |  |      |   |  |      |  

Our property and equipment by major country are summarized as follows (in thousands):



|                             |  |              |        |      |   |        
|---------------------------- |  | ------------ | ------ | ---- | - | -------
|                             |  | November 30,
|                             |  | 2009         |        | 2008
|Property and equipment, net: |  |              |        |      |   |        
|United States                |  | $            | 90,254 |      | $ | 97,576 
|United Kingdom               |  |              | 2,224  |      |   | 2,240  
|Other                        |  |              | 2,153  |      |   | 3,715  
|                             |  |              |        |      |   |        
|                             |  | $            | 94,631 |      | $ | 103,531
|                             |  |              |        |      |   |        



F-45



---

##### Table of Contents

TIBCO SOFTWARE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



23.    Selected Quarterly Financial Information (Unaudited)

(in thousands, except per share data)



|                                               |  |                    |         |                |   |             |  |                  |         |  |   |        
|---------------------------------------------- |  | ------------------ | ------- | -------------- | - | ----------- |  | ---------------- | ------- |  | - | -------
|                                               |  | Three Months Ended
|                                               |  | November 30,2009   |         | August 31,2009 |   | May 31,2009 |  | February 28,2009
|Total revenue                                  |  | $                  | 195,570 |                | $ | 150,252     |  | $                | 142,670 |  | $ | 132,896
|Gross profit                                   |  |                    | 152,773 |                |   | 111,949     |  |                  | 102,773 |  |   | 94,841 
|Total operating expenses                       |  |                    | 107,932 |                |   | 91,440      |  |                  | 88,758  |  |   | 85,604 
|Income from operations                         |  |                    | 44,841  |                |   | 20,509      |  |                  | 14,015  |  |   | 9,237  
|Provision for income taxes                     |  |                    | 12,518  |                |   | 5,629       |  |                  | 4,828   |  |   | 4,122  
|Net income                                     |  |                    | 31,733  |                |   | 14,866      |  |                  | 10,077  |  |   | 5,626  
|Net income per share:                          |  |                    |         |                |   |             |  |                  |         |  |   |        
|Basic                                          |  | $                  | 0.19    |                | $ | 0.09        |  | $                | 0.06    |  | $ | 0.03   
|Diluted                                        |  | $                  | 0.18    |                | $ | 0.09        |  | $                | 0.06    |  | $ | 0.03   
|Shares used in computing net income per share: |  |                    |         |                |   |             |  |                  |         |  |   |        
|Basic                                          |  |                    | 164,925 |                |   | 168,036     |  |                  | 171,635 |  |   | 171,284
|Diluted                                        |  |                    | 171,886 |                |   | 172,194     |  |                  | 173,134 |  |   | 172,092



|                                               |  |                    |         |                |   |             |  |                  |         |  |   |        
|---------------------------------------------- |  | ------------------ | ------- | -------------- | - | ----------- |  | ---------------- | ------- |  | - | -------
|                                               |  | Three Months Ended
|                                               |  | November 30,2008   |         | August 31,2008 |   | May 31,2008 |  | February 28,2008
|Total revenue                                  |  | $                  | 185,524 |                | $ | 162,337     |  | $                | 150,032 |  | $ | 146,578
|Gross profit                                   |  |                    | 141,524 |                |   | 117,061     |  |                  | 104,460 |  |   | 103,528
|Total operating expenses                       |  |                    | 100,819 |                |   | 101,803     |  |                  | 100,436 |  |   | 97,780 
|Income from operations                         |  |                    | 40,705  |                |   | 15,258      |  |                  | 4,024   |  |   | 5,748  
|Provision for income taxes                     |  |                    | 8,923   |                |   | 4,917       |  |                  | 1,641   |  |   | 2,833  
|Net income                                     |  |                    | 32,291  |                |   | 11,113      |  |                  | 3,493   |  |   | 5,514  
|Net income per share:                          |  |                    |         |                |   |             |  |                  |         |  |   |        
|Basic                                          |  | $                  | 0.18    |                | $ | 0.06        |  | $                | 0.02    |  | $ | 0.03   
|Diluted                                        |  | $                  | 0.18    |                | $ | 0.06        |  | $                | 0.02    |  | $ | 0.03   
|Shares used in computing net income per share: |  |                    |         |                |   |             |  |                  |         |  |   |        
|Basic                                          |  |                    | 174,612 |                |   | 179,094     |  |                  | 182,078 |  |   | 186,315
|Diluted                                        |  |                    | 175,758 |                |   | 183,154     |  |                  | 185,990 |  |   | 190,064

Our operating results reflect seasonal trends experienced by us and many software
companies and are subject to fluctuations due to other factors. Our business, financial condition and results of operations may be affected by such factors in the future. Therefore, we believe that period-to-period comparisons of our consolidated
financial results should not be relied upon as an indication of future performance.

24.    Subsequent Events

Foresight Corporation

On December 31, 2009, we acquired Foresight Corporation (Foresight), a private company incorporated in Delaware and a leading provider of EDI productivity tools and transaction
automation solutions. We paid $30.0 million of cash to acquire the outstanding equity of Foresight. We have also incurred transaction costs associated with the acquisition. As a result of the acquisition, TIBCO also assumed facility
leases, certain liabilities and commitments of Foresight. Management is currently evaluating the purchase price allocation following consummation of the transaction.



F-46



---

##### Table of Contents

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly
caused this Annual Report on Form 10-K to be signed on its behalf by the undersigned, thereunto duly authorized, on this 29thday of January 2010.



TIBCO Software Inc.By:

/S/ SYDNEY L. CAREYSydney L. Carey Executive Vice President, Chief Financial Officer




II-1



---

##### Table of Contents

POWER OF ATTORNEY

KNOW ALL THESE, PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Vivek Y. Ranadivé
and Sydney L. Carey, and each of them, his attorneys-in-fact, each with full power of substitution, for him in any and all capacities, to sign any and all amendments to this Annual Report on Form 10-K, and to file the same, with exhibits thereto and
other documents in connection therewith, with the Securities and Exchange Commission, hereby ratifying and confirming all that each said attorneys-in-fact or his substitute or substitutes, may do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, this Annual Report on Form 10-K has been signed below by the following
persons on behalf of the registrant and in the capacities and on the dates indicated.



|                                        |  |                                                                    |  |                 
|--------------------------------------- |  | ------------------------------------------------------------------ |  | ----------------
|Signature                               |  | Title                                                              |  | Date            
|                                        |  |                                                                   
|/s/ VIVEK Y. RANADIVÉ Vivek Y. Ranadivé |  | Chairman and Chief Executive Officer (Principal Executive Officer) |  | January 29, 2010
|                                        |  |                                                                   
|/s/ SYDNEY L. CAREY Sydney L. Carey     |  | Vice President, Corporate Controller (PrincipalAccounting Officer) |  | January 29, 2010
|                                        |  |                                                                   
|/s/ TROY O. MITCHELL Troy O. Mitchell   |  | Vice President, Corporate Controller (PrincipalAccounting Officer) |  | January 29, 2010
|                                        |  |                                                                   
|/s/ NANCI E. CALDWELL Nanci E. Caldwell |  | Director                                                           |  | January 29, 2010
|                                        |  |                                                                   
|/s/ ERIC DUNN Eric Dunn                 |  | Director                                                           |  | January 29, 2010
|                                        |  |                                                                   
|/s/ NAREN GUPTA Naren Gupta             |  | Director                                                           |  | January 29, 2010
|                                        |  |                                                                   
|/s/ PETER JOB Peter Job                 |  | Director                                                           |  | January 29, 2010
|                                        |  |                                                                   
|/s/ PHILLIP K. WOOD Phillip K. Wood     |  | Director                                                           |  | January 29, 2010



II-2



---

##### Table of Contents

EXHIBIT INDEX



|            |  |                                                                                                                                                                                                                                                                                                                        
|----------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Exhibits                                                                                                                                                                                                                                                                                                               
|3.1(1)      |  | Amended and Restated Certificate of Incorporation of Registrant.                                                                                                                                                                                                                                                       
|3.2(2)      |  | Amended and Restated Bylaws of Registrant, as amended and restated.                                                                                                                                                                                                                                                    
|3.3(15)     |  | Certificate of Designation of Rights, Preferences and Privileges of Series A Participating Preferred Stock of the Registrant.                                                                                                                                                                                          
|4.1(15)     |  | Preferred Stock Rights Agreement, dated as of February 14, 2004, between the Registrant and EquiServe Trust Company, N.A., including the Certificate of Designation, the Form of
Rights Certificate and the Summary of Rights attached thereto as Exhibits A, B and C, respectively.                                   
|10.1(3)     |  | Form of Registrants Indemnification Agreement.                                                                                                                                                                                                                                                                        
|10.2(4)#    |  | 1996 Stock Option Plan, as amended and restated.                                                                                                                                                                                                                                                                       
|10.3(3)#    |  | Form of Stock Option Agreement pursuant to the 1996 Stock Option Plan.                                                                                                                                                                                                                                                 
|10.4(11)#   |  | Form of Restricted Stock Agreement pursuant to the 1996 Stock Option Plan.                                                                                                                                                                                                                                             
|10.5(3)#    |  | Form of Restricted Stock Unit Agreement pursuant to the 1996 Stock Option Plan.                                                                                                                                                                                                                                        
|10.6(5)#    |  | 1998 Director Option Plan, as amended and restated.                                                                                                                                                                                                                                                                    
|10.7(11)#   |  | Form of Director Option Agreement pursuant to the 1998 Director Option Plan.                                                                                                                                                                                                                                           
|10.8(6)#    |  | 2008 Equity Incentive Plan.                                                                                                                                                                                                                                                                                            
|10.9(7)#    |  | Form of Stock Option Agreement pursuant to the 2008 Equity Incentive Plan.                                                                                                                                                                                                                                             
|10.10(7)#   |  | Form of Restricted Stock Agreement pursuant to the 2008 Equity Incentive Plan.                                                                                                                                                                                                                                         
|10.11(16)#  |  | Form of Restricted Stock Unit Agreement pursuant to the 2008 Equity Incentive Plan.                                                                                                                                                                                                                                    
|10.12(6)#   |  | 2008 Employee Stock Purchase Plan.                                                                                                                                                                                                                                                                                     
|10.13(8)#   |  | Extensibility, Inc. 2000 Stock Plan.                                                                                                                                                                                                                                                                                   
|10.14(9)#   |  | Talarian Corporation 2000 Equity Incentive Plan.                                                                                                                                                                                                                                                                       
|10.15(9)#   |  | Talarian Corporation 1998 Equity Incentive Plan.                                                                                                                                                                                                                                                                       
|10.16(9)#   |  | White Barn, Inc. Stock Option Plan.                                                                                                                                                                                                                                                                                    
|10.17(9)#   |  | White Barn, Inc. 2000 Equity Incentive Plan.                                                                                                                                                                                                                                                                           
|10.18(10)#  |  | Insightful Corporation Amended and Restated 2001 Stock Option and Incentive Plan.                                                                                                                                                                                                                                      
|10.19(11)#  |  | Form of Restricted Stock Agreement pursuant to the Insightful Corporation Amended and Restated 2001 Stock Option and Incentive Plan.                                                                                                                                                                                   
|10.20(11)#  |  | Form of Restricted Stock Unit Agreement pursuant to the Insightful Corporation Amended and Restated 2001 Stock Option and Incentive Plan.                                                                                                                                                                              
|10.21(11)#  |  | Change in Control and Severance Plan.                                                                                                                                                                                                                                                                                  
|10.23(11)#  |  | Amended and Restated Employment Agreement, dated as of September 26, 2008, by and between Vivek Ranadivé and Registrant.                                                                                                                                                                                               
|10.24(12)   |  | Lease Agreement dated January 21, 2000 between Spieker Properties, L.P. and the Registrant.                                                                                                                                                                                                                            
|10.25(13)   |  | Agreement to Lease and Sell Assets, dated as of June 2, 2003, by and between the Board of Trustees of the Leland Stanford Junior University and 3301 Hillview Holdings,
Inc.                                                                                                                                           
|10.26(13)   |  | Ground Lease, dated as of June 25, 2003, by and between the Board of Trustees of the Leland Stanford Junior University and 3301 Hillview Holdings, Inc.                                                                                                                                                                
|10.27(13)   |  | Promissory Note issued on June 25, 2003 to SunAmerica Life Insurance Company by 3301 Hillview Holdings, Inc.                                                                                                                                                                                                           
|10.28(14)   |  | First Amendment, dated May 31, 2007, to Promissory Note issued on June 25, 2003 to SunAmerica Life Insurance Company by 3301 Hillview Holdings, Inc.                                                                                                                                                                   
|10.29(16)#  |  | TIBCO Software Inc. 2009 Deferred Compensation Plan.                                                                                                                                                                                                                                                                   
|10.30(16)#  |  | Form of Restricted Stock Unit Agreement pursuant to the TIBCO Software Inc. 2009 Deferred Compensation Plan.                                                                                                                                                                                                           
|10.31(17)   |  | Agreement and Plan of Merger by and among TIBCO Software Inc., Touchdown Acquisition Corporation, DataSynapse, Inc., the Persons listed on Annex 1 thereto, Bain Capital Venture Fund
2001, L.P., as Stockholder Representative and U.S. Bank, National Association, as Escrow Agent, dated as of August 21, 2009.     
|10.32(18)   |  | Credit Agreement, dated as of November 2, 2009, by and among TIBCO Software Inc., each of the lenders party thereto from time to time, Silicon Valley Bank, as Syndication Agent,
Wells Fargo Bank, N.A., as Documentations Agent, and Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer



---

##### Table of Contents

|            |  |                                                                                                                                  
|----------- |  | ---------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Exhibits                                                                                                                         
|21          |  | List of subsidiaries.                                                                                                            
|23          |  | Consent of PricewaterhouseCoopers LLP, Independent Registered Public Accounting Firm.                                            
|24          |  | Power of Attorney (included on signature page).                                                                                  
|31.1        |  | Certification by Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as amended.
|31.2        |  | Certification by Chief Financial Officer Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as amended.            
|32.1        |  | Certification by Chief Executive Officer pursuant to 18 USC § 1350.                                                              
|32.2        |  | Certification by Chief Financial Officer pursuant to 18 USC § 1350.                                                              



|(1) | Incorporated by reference to an exhibit filed with the Registrants Registration Statement on Form 8-A, filed with the SEC on February 23, 2004.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Incorporated by reference to an exhibit filed with the Registrants Quarterly Report on Form 10-Q, filed with the SEC on July 9, 2009.
|--- | --------------------------------------------------------------------------------------------------------------------------------------

|(3) | Incorporated by reference to an exhibit filed with the Registrants Annual Report on Form 10-K, filed with the SEC on January 25, 2008.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------

|(4) | Incorporated by reference to an exhibit filed with the Registrants Annual Report on Form 10-K, filed with the SEC on February 9, 2007.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------

|(5) | Incorporated by reference to an exhibit filed with the Registrants Quarterly Report on Form 10-Q, filed with the SEC on April 14, 2006.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------

|(6) | Incorporated by reference to exhibits filed with the Registrants Registration Statement on Form S-8 (File No. 333-152245), filed with the SEC on
July 10, 2008.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------

|(7) | Incorporated by reference to an exhibit filed with the Registrants Quarterly Report on Form 10-Q, filed with the SEC on July 10, 2008.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------

|(8) | Incorporated by reference to an exhibit filed with the Registrants Registration Statement on Form S-8 (File No. 333-48260), filed with the SEC on
October 19, 2000.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(9) | Incorporated by reference to exhibits filed with the Registrants Registration Statement on Form S-8 (File No. 333-88730), filed with the SEC on May 21,
2002.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------

|(10) | Incorporated by reference to an exhibit filed with the Registrants Registration Statement on Form S-8 (File No. 333-153333), filed with the SEC on
September 5, 2008.
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(11) | Incorporated by reference to an exhibit filed with the Registrants Annual Report on Form 10-K, filed with the SEC on January 28, 2009.
|---- | ---------------------------------------------------------------------------------------------------------------------------------------

|(12) | Incorporated by reference to an exhibit filed with the Registrants Quarterly Report on Form 10-Q, filed with the SEC on April 17, 2000.
|---- | ----------------------------------------------------------------------------------------------------------------------------------------

|(13) | Incorporated by reference to exhibits filed with the Registrants Annual Report on Form 10-K, filed with the SEC on January 20, 2004.
|---- | -------------------------------------------------------------------------------------------------------------------------------------

|(14) | Incorporated by reference to exhibits filed with the Registrants Quarterly Report on Form 10-Q, filed with the SEC on July 13, 2007.
|---- | -------------------------------------------------------------------------------------------------------------------------------------

|(15) | Incorporated by reference to an exhibit filed with the Registrants Registration Statement on Form 8-A, filed with the SEC on February 23, 2004, as amended.
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------

|(16) | Incorporated by reference to exhibits filed with the Registrants Quarterly Report on Form 10-Q, filed with the SEC on April 9, 2009.
|---- | -------------------------------------------------------------------------------------------------------------------------------------

|(17) | Incorporated by reference to an exhibit filed with the Registrants Current Report on Form 8-K, filed with the SEC on August 24, 2009
|---- | -------------------------------------------------------------------------------------------------------------------------------------

|(18) | Incorporated by reference to an exhibit filed with the Registrants Current Report on Form 8-K, filed with the SEC on November 2, 2009.
|---- | ---------------------------------------------------------------------------------------------------------------------------------------

|# | Indicates management contract or compensatory plan or arrangement.
|- | ------------------------------------------------------------------