Riverbed Technology (RVBD)

11. Subsequent Events

On January 20, 2009, The Company entered into an Agreement of Merger with Riverbed Technology, Inc. pursuant to which, upon the terms and subject to the conditions set forth therein; (a) Mazu became a wholly-owned subsidiary of Riverbed; and (b) Riverbed Technology, Inc: (i) acquired all of the outstanding securities of Mazu; (ii) made payments totaling approximately $25.0 million in cash promptly following the closing; and (iii) will potentially make payments totaling up to $22.0 million in cash based on achievement of certain bookings targets for the one-year period from April 1, 2009 through March 31, 2010. The closing of the Merger occurred on February 19, 2009.

10. Subsequent Events

In March 2008, the Company issued 22,593,765 shares of Series D Preferred Stock, resulting in proceeds of $5,000,000.

In April 2008, the Company amended the Loan Agreement to modify the payment schedules under both the 2005 and 2007 Loan Commitments as follows: monthly payments of interest only at a variable rate of the prime lending rate plus 225 basis points per annum until March 31, 2009, followed by 36 fixed monthly payments of principal and interest at a rate equal to the prime rate at March 31, 2009 plus 225 basis points and then an interest-only payment of $550,000 due in May 2012.

17.    SUBSEQUENT EVENTS

On January 20, 2009, we entered into an Agreement of Merger with Maple Acquisition Sub, Inc., our wholly owned subsidiary (“Merger Sub”), Mazu Networks, Inc. (“Mazu”), and an agent for the stockholders of Mazu, pursuant to which, upon the terms and subject to the conditions set forth therein: (a) Merger Sub will merge with and into Mazu (the “Merger”), with Mazu continuing as the surviving corporation and as a wholly-owned subsidiary of Riverbed; and (b) we will: (i) acquire all of the outstanding securities of Mazu; (ii) made payments totaling approximately $25.0 million in cash promptly following the closing; and (iii) will potentially make payments totaling up to $22.0 million in cash based on achievement of certain bookings targets for the one-year period from April 1, 2009 through March 31, 2010. The closing of the Merger occurred on February 19, 2009.

Mazu helps organizations manage, secure and optimize the availability and performance of global applications. The acquisition allows us to meet enterprise and service provider customer demands by extending our suite of WAN optimization products to include global application performance, reporting and analytics.

On February 18, 2009, our Board of Directors adopted the Riverbed Technology, Inc. 2009 Inducement Equity Incentive Plan (the “Inducement Plan”), and reserved 1,500,000 shares of common stock for future issuance thereunder. The objective of the Inducement Plan is to provide incentives to attract, retain and motivate eligible persons whose potential contributions are important to promote our long-term success and the creation of stockholder value. The Inducement Plan is intended to comply with NASDAQ Rule 4350(i)(1)(A)(iv), which governs granting certain awards as a material inducement to an individual entering into employment with us. The Inducement Plan will be used to grant options to Mazu employees that are joining Riverbed following the closing of the Merger, and may be used for new hire equity grants should our Board or Compensation Committee of the Board determine to do so in the future.

85

Table of Contents

There have been no disagreements with accountants on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedures required to be reported under this item.

17.    SUBSEQUENT EVENTS

FACE="ARIAL" SIZE="2">On January 20, 2009, we entered into an Agreement of Merger with Maple Acquisition Sub, Inc., our wholly owned subsidiary (“Merger Sub”), Mazu Networks, Inc. (“Mazu”), and an agent for the stockholders
of Mazu, pursuant to which, upon the terms and subject to the conditions set forth therein: (a) Merger Sub will merge with and into Mazu (the “Merger”), with Mazu continuing as the surviving corporation and as a wholly-owned
subsidiary of Riverbed; and (b) we will: (i) acquire all of the outstanding securities of Mazu; (ii) made payments totaling approximately $25.0 million in cash promptly following the closing; and (iii) will potentially make
payments totaling up to $22.0 million in cash based on achievement of certain bookings targets for the one-year period from April 1, 2009 through March 31, 2010. The closing of the Merger occurred on February 19, 2009.

16.    SUBSEQUENT EVENTS

On February 7, 2007, we announced our intention to file a registration statement on Form S-1 with the SEC for the sale to the public of approximately 2.35 million shares of our common stock by us and approximately 2.65 million shares by selling stockholders.