<SUBMISSION>
<ACCESSION-NUMBER>0000950134-07-001388
<TYPE>DEF 14A
<PUBLIC-DOCUMENT-COUNT>4
<PERIOD>20070322
<FILING-DATE>20070126
<DATE-OF-FILING-DATE-CHANGE>20070126
<EFFECTIVENESS-DATE>20070126
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>F5 NETWORKS INC
<CIK>0001048695
<ASSIGNED-SIC>3576
<IRS-NUMBER>911714307
<STATE-OF-INCORPORATION>WA
<FISCAL-YEAR-END>0930
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>DEF 14A
<ACT>34
<FILE-NUMBER>000-26041
<FILM-NUMBER>07556178
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>401 ELLIOT AVE WEST
<STREET2>STE 500
<CITY>SEATTLE
<STATE>WA
<ZIP>98119
<PHONE>2062725555
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>401 ELLIOT AVE WEST
<STREET2>STE 500
<CITY>SEATTLE
<STATE>WA
<ZIP>98119
</MAIL-ADDRESS>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>F5 LABS INC
<DATE-CHANGED>19990305
</FORMER-COMPANY>
</FILER>
<DOCUMENT>
<TYPE>DEF 14A
<SEQUENCE>1
<FILENAME>v26639dedef14a.htm
<DESCRIPTION>DEFINITIVE PROXY STATEMENT
<TEXT>
<HTML>
<HEAD>
<TITLE>def14a</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>
<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="center" style="font-size: 14pt; margin-top: 18pt"><B>UNITED STATES<BR>
SECURITIES AND EXCHANGE COMMISSION</B></DIV>
<DIV align="center" style="font-size: 12pt; margin-top: 0pt"><B>Washington, DC 20549</B>
</DIV>

<DIV align="center" style="font-size: 18pt; margin-top: 12pt"><B>SCHEDULE 14A</B></DIV>

<DIV align="center" style="font-size: 12pt; margin-top: 12pt"><B>PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE<BR>
SECURITIES EXCHANGE ACT OF 1934</B></DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Filed by the Registrant <FONT face="Wingdings">&#254;</FONT>

</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Filed by a Party other than the Registrant <FONT face="Wingdings">&#111;</FONT>

</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="97%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD colspan="3" valign="top" align="left">Check the appropriate box:</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><FONT face="Wingdings">&#111;</FONT>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Preliminary Proxy Statement</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><FONT face="Wingdings">&#111;</FONT>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B>Confidential, for Use of the Commission Only (as permitted by Rule&nbsp;14a-6(e)(2))</B></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><FONT face="Wingdings">&#254;</FONT>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Definitive Proxy Statement</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><FONT face="Wingdings">&#111;</FONT>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Definitive Additional Materials</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><FONT face="Wingdings">&#111;</FONT>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Soliciting Material under &#167; 240.14a-12</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="center" style="font-size: 14pt; margin-top: 12pt"><B>F5
NETWORKS, INC.</B></DIV>

<DIV align="center" style="font-size: 10pt"><B>(Name of Registrant as Specified in Its Charter)</B></DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 12pt"><B>N/A</B></DIV>

<DIV align="center" style="font-size: 10pt"><B>(Name of Person(s) Filing Proxy Statement, if other than the Registrant)</B></DIV>


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="97%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD colspan="3" valign="top" align="left">Payment of Filing Fee (Check the appropriate box):</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><FONT face="Wingdings">&#254;</FONT>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">No fee required.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><FONT face="Wingdings">&#111;</FONT>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Fee computed on table below per Exchange Act Rules&nbsp;14a-6(i)(1) and 0-11.</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left">(1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Title of each class of securities to which transaction applies:</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left">(2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Aggregate number of securities to which transaction applies:</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left">(3)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Per unit price or other underlying value of transaction computed pursuant to Exchange
Act Rule&nbsp;0-11 (set forth the amount on which the filing fee is calculated and state how it
was determined):</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left">(4)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Proposed maximum aggregate value of transaction:</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left">(5)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Total fee paid:</TD>
</TR>

</TABLE>
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="97%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><FONT face="Wingdings">&#111;</FONT>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Fee paid previously with preliminary materials:</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><FONT face="Wingdings">&#111;</FONT>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Check box if any part of the fee is offset as provided by Exchange Act Rule&nbsp;0-11(a)(2) and
identify the filing for which the offsetting fee was paid previously. Identify the previous
filing by registration statement number, or the Form or Schedule and the date of its filing.</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Amount Previously Paid:</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Form, Schedule or Registration Statement No.:</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(3)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Filing Party:</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(4)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Date Filed:</TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>

<DIV style="width: 91%; margin-left: 4%"><!-- BEGIN LOGICAL PAGE -->

<!-- TOC -->
<A name="toc"><DIV align="CENTER" style="page-break-before:always"><U><B>TABLE OF CONTENTS</B></U></DIV></A>

<P><CENTER>
<TABLE border="0" width="90%" cellpadding="0" cellspacing="0">
<TR>
	<TD width="3%"></TD>
	<TD width="3%"></TD>
	<TD width="3%"></TD>
	<TD width="3%"></TD>
	<TD width="3%"></TD>
	<TD width="3%"></TD>
	<TD width="3%"></TD>
	<TD width="3%"></TD>
	<TD width="76%"></TD>
</TR>
<TR><TD colspan="9"><A HREF="#000">PROXY STATEMENT</A></TD></TR>
<TR><TD colspan="9"><A HREF="#001">BOARD OF DIRECTORS</A></TD></TR>
<TR><TD colspan="9"><A HREF="#002">SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT</A></TD></TR>
<TR><TD colspan="9"><A HREF="#003">PROPOSAL 1: ELECTION OF THREE CLASS II DIRECTORS</A></TD></TR>
<TR><TD colspan="9"><A HREF="#004">THE BOARD OF DIRECTORS RECOMMENDS A VOTE &#147;FOR&#148; THE ELECTION OF THE THREE NOMINEES.</A></TD></TR>
<TR><TD colspan="9"><A HREF="#005">PROPOSAL 2: AMENDMENT TO THE 2005 EQUITY INCENTIVE PLAN</A></TD></TR>
<TR><TD colspan="9"><A HREF="#006">PROPOSAL 3. RATIFICATION OF INDEPENDENT AUDITOR</A></TD></TR>
<TR><TD colspan="9"><A HREF="#007">PROPOSAL 4: SHAREHOLDER PROPOSAL</A></TD></TR>
<TR><TD colspan="9"><A HREF="#008">OTHER BUSINESS</A></TD></TR>
<TR><TD colspan="9"><A HREF="#009">SHAREHOLDER PROPOSALS FOR THE ANNUAL MEETING FOR FISCAL YEAR END 2007</A></TD></TR>
<TR><TD colspan="9"><A HREF="#010">HOUSEHOLDING OF PROXY MATERIALS</A></TD></TR>
</TABLE>
</CENTER>
<!-- /TOC -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <IMG src="v26639dev2663900.gif" alt="[F5 NETWORKS, INC. LOGO]" >
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 16%; border-bottom: 1pt solid #000000"></CENTER><!-- callerid=999 iwidth=504 length=84 -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 12pt">NOTICE OF ANNUAL MEETING OF
    SHAREHOLDERS</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 12pt">To Be Held on March&#160;22,
    2007</FONT></B>
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 16%; border-bottom: 1pt solid #000000"></CENTER><!-- callerid=999 iwidth=504 length=84 -->

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <FONT style="font-family: 'Times New Roman', Times">TO
    SHAREHOLDERS OF F5 NETWORKS, INC.:
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Annual Meeting of shareholders of F5 Networks, Inc. (the
    &#147;Company&#148;) for fiscal year end 2006 will be held on
    March&#160;22, 2007 at 10:00 am Pacific Standard Time at F5
    Networks, Inc., 401 Elliott Avenue West, Seattle, Washington
    98119 for the following purposes, as more fully described in the
    accompanying Proxy Statement:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    1.&#160;to elect three Class&#160;II directors to hold office
    until the Annual Meeting of Shareholders for fiscal year end
    2009 and until their successors are elected and qualified;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    2.&#160;to consider and act upon a proposal to approve an
    amendment to the F5 Networks, Inc. 2005 Equity Incentive Plan
    (the &#147;2005 Plan&#148;) to increase the number of shares of
    common stock issuable under the 2005 Plan by an additional
    2,000,000;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    3.&#160;to ratify the selection of PricewaterhouseCoopers LLP as
    the Company&#146;s independent auditor for fiscal year 2007;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    4.&#160;to consider and act upon a shareholder proposal if
    properly presented at the meeting;&#160;and
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    5.&#160;to transact such other business as may properly come
    before the meeting and any adjournments or postponements thereof.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Only shareholders of record at the close of business on
    January&#160;16, 2007 are entitled to notice of, and to vote at,
    the Annual Meeting.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 50%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    By Order of the Board of Directors,
</DIV>

<DIV style="margin-top: 10pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 50%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <IMG src="v26639dev2663903.gif" alt="-s- Jeffrey A. Christianson" >
</DIV>

<DIV align="left" style="margin-left: 50%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <FONT style="font-variant: SMALL-CAPS">Jeffrey A. Christianson
    </FONT>
</DIV>

<DIV align="left" style="margin-left: 50%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Secretary</I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Seattle, Washington
</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    January&#160;26, 2007
</DIV>

<DIV style="margin-top: 16pt; font-size: 1pt">&nbsp;</DIV>
<DIV style="width: 100%; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>YOUR VOTE IS IMPORTANT!</B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>Whether or not you attend the annual meeting, it is important
    that your shares be represented and voted at the meeting.
    Therefore, I urge you to promptly vote and submit your proxy by
    phone, over the Internet, or by signing, dating, and returning
    the accompanying proxy card in the enclosed, prepaid, return
    envelope. If you decide to attend the annual meeting, you will
    be able to vote in person, even if you have previously submitted
    your proxy. Voting via the Internet is a valid proxy voting
    method under the laws of the State of Washington (our state of
    incorporation).</B>
</DIV>
</DIV><!-- End box 1 -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>The F5 Networks, Inc. Annual Report is available online at
    www.f5.com</B>
</DIV>

<P align="left" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV><!-- END LOGICAL PAGE -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->
<DIV style="width: 100%; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>Please do not return the enclosed paper ballot if you are</B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>voting over the Internet or by telephone.</B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="50%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="48%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
</TR>
<TR valign="bottom">
<TD align="center" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B><FONT style="font-size: 10pt">VOTE BY INTERNET</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    <B><FONT style="font-size: 10pt">VOTE BY TELEPHONE</FONT></B>
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="center" valign="top">
    <FONT style="font-size: 10pt">www.proxyvote.com
    </FONT>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    <FONT style="font-size: 10pt"><FONT style="white-space: nowrap">1-800-690-6903</FONT>
    via touch tone
    </FONT>
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="center" valign="top">
    <FONT style="font-size: 10pt">24&#160;hours a day/7&#160;days a
    week
    </FONT>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    <FONT style="font-size: 10pt">24&#160;hours a day/7&#160;days a
    week
    </FONT>
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: 0pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">Use the Internet to transmit your
    voting instructions and for electronic delivery of information
    up until 11:59&#160;p.m. Eastern time on March&#160;21, 2007.
    Have your proxy  card in hand when you access the web site and
    follow the instructions to obtain your records and to create an
    electronic voting instruction form.
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    <FONT style="font-size: 10pt">Use any touch-tone telephone to
    transmit your voting instructions up  until 11:59&#160;p.m.
    Eastern time on   March&#160;21, 2007. Have your proxy card in
    hand when you call and then follow the instructions.
    </FONT>
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
</DIV><!-- End box 1 -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Your cooperation is appreciated since a majority of the shares
    of common stock must be represented, either in person or by
    proxy, to constitute a quorum for the conduct of business.
</DIV>

<P align="left" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV><!-- END LOGICAL PAGE -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 14pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">F5
    NETWORKS, INC.<BR>
    <FONT style="font-size: 10pt">401 Elliott Avenue West<BR>
    Seattle, Washington 98119</FONT></FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 18%; border-bottom: 1pt solid #000000"></CENTER><!-- callerid=999 iwidth=456 length=84 -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>


<!-- link1 "PROXY STATEMENT" -->
<DIV align="left"><A NAME="000"></A></DIV>


<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 14pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">PROXY
    STATEMENT</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 14pt">FISCAL YEAR END 2006 ANNUAL
    MEETING OF SHAREHOLDERS</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 18%; border-bottom: 1pt solid #000000"></CENTER><!-- callerid=999 iwidth=456 length=84 -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    F5 Networks, Inc. (the &#147;Company&#148;) is furnishing this
    Proxy Statement and the enclosed proxy in connection with the
    solicitation of proxies by the Board of Directors of the Company
    for use at the Annual Meeting of Shareholders to be held on
    March&#160;22, 2007, at 10:00 am, Pacific Standard Time at F5
    Networks, Inc., 401 Elliott Avenue West, Seattle, Washington
    98119, and at any adjournments thereof (the &#147;Annual
    Meeting&#148;). These materials are being mailed to shareholders
    on or about February&#160;2, 2007.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Only holders of the Company&#146;s common stock, no par value
    (the &#147;Common Stock&#148;), as of the close of business on
    January&#160;16, 2007 (the &#147;Record Date&#148;) are entitled
    to vote at the meeting. As of the Record Date, there were
    41,259,736&#160;shares of Common Stock outstanding.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    A majority of the outstanding shares of Common Stock entitled to
    vote at the Annual Meeting must be present in person or by proxy
    in order for there to be a quorum at the meeting. Shareholders
    of record who are present at the meeting in person or by proxy
    and who abstain from voting, including brokers holding
    customers&#146; shares of record who cause abstentions to be
    recorded at the meeting, will be included in the number of
    shareholders present at the meeting for purposes of determining
    whether a quorum is present.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Each shareholder of record is entitled to one vote at the Annual
    Meeting for each share of Common Stock they hold on the Record
    Date. Shareholders may vote their shares by using the enclosed
    proxy card, over the Internet or by phone. If a proxy is
    received that does not specify a vote or an abstention, the
    shares represented by that proxy will be voted: (1) FOR the
    nominees to the Board of Directors listed in this Proxy
    Statement; (2) FOR an amendment to the 2005 Plan to increase the
    number of shares of common stock issuable under the 2005 Plan;
    (3) FOR the ratification of the selection of
    PricewaterhouseCoopers LLP as the Company&#146;s independent
    auditor for the fiscal year ending September 30, 2007; (4)
    AGAINST the shareholder proposal regarding executive
    compensation; and (5) in accordance with the discretion of the
    named proxy on any other matters properly brought before the
    Annual Meeting. The Company is not aware, as of the date hereof,
    of any matters to be voted upon at the Annual Meeting other than
    those stated in this Proxy Statement and the accompanying Notice
    of Annual Meeting of Shareholders. If any other matters are
    properly brought before the Annual Meeting, the enclosed proxy
    card and proxies submitted by telephone or over the Internet
    give discretionary authority to the person named as proxy to
    vote the shares represented by the proxy in his discretion.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Under Washington law and the Company&#146;s Second Amended and
    Restated Articles of Incorporation and Bylaws (the
    &#147;Bylaws&#148;), if a quorum exists at the meeting, the
    nominees for director who receive the greatest number of votes
    cast will be elected to the Board of Directors. In addition, if
    a quorum exists at the meeting, approval of all other matters
    that properly come before the Annual Meeting requires that the
    votes cast in favor of such actions exceed the votes cast
    against such actions. Abstentions and &#147;broker
    non-votes&#148; (shares held by a broker or nominee that does
    not have the authority, either express or discretionary, to vote
    on a particular matter) will have no impact on the election of
    directors or the other proposals at the meeting since they have
    not been cast in favor of or against any nominee or a proposal.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    A shareholder may revoke a proxy at any time before it is voted
    at the Annual Meeting by (a)&#160;delivering a proxy revocation
    or another proxy bearing a later date to the Corporate Secretary
    of the Company at 401 Elliott Avenue West, Seattle, Washington
    98119 before or at the Annual Meeting or (b)&#160;attending the
    Annual Meeting and voting in person. Attendance at the Annual
    Meeting will not revoke a proxy unless the shareholder actually
    votes in person at the meeting.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    1
</DIV><!-- END LOGICAL PAGE -->
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<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Board of Directors of the Company is soliciting the proxies
    accompanying this Proxy Statement. The Company will pay all of
    the costs of this proxy solicitation. However, you will need to
    obtain your own Internet access if you choose to access the
    proxy materials
    <FONT style="white-space: nowrap">and/or</FONT> vote
    over the Internet. In addition to mail solicitation, officers,
    directors, and employees of the Company may solicit proxies
    personally or by telephone, without receiving additional
    compensation. The Company has retained Advantage Proxy to assist
    in connection with the solicitation of proxies in connection
    with the Annual Meeting. The Company will pay Advantage Proxy
    customary fees, which are expected to be $5,000 plus expenses.
    The Company, if requested, will pay brokers, banks, and other
    fiduciaries that hold shares of Common Stock for beneficial
    owners for their reasonable
    <FONT style="white-space: nowrap">out-of-pocket</FONT>
    expenses of forwarding these materials to shareholders.
</DIV>


<!-- link1 "BOARD OF DIRECTORS" -->
<DIV align="left"><A NAME="001"></A></DIV>


<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">BOARD OF
    DIRECTORS</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Board of Directors of the Company currently consists of
    seven directors divided into three classes. Currently, the
    Class&#160;I directors are Karl D. Guelich and Keith D.
    Grinstein; the Class&#160;II directors are Deborah L. Bevier,
    Alan J. Higginson and John McAdam; and the Class&#160;III
    directors are Rich Malone and A. Gary Ames. At the Annual
    Meeting, the shareholders will vote on the election of three
    Class&#160;II directors to serve for three-year terms until the
    annual meeting of shareholders for fiscal year end 2009 and
    until their successors are elected and qualified. The
    Class&#160;I directors will hold office until the Company&#146;s
    annual meeting for fiscal year end 2008 and the Class&#160;III
    directors will hold office until the Company&#146;s annual
    meeting for fiscal year end 2007. All directors will hold office
    until the annual meeting of shareholders at which their terms
    expire and the election and qualification of their successors.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Board of Directors has nominated Deborah L. Bevier, Alan J.
    Higginson and John McAdam for reelection to the Board of
    Directors as Class&#160;II directors at the Annual Meeting. The
    nominees have consented to serve as directors of the Company if
    elected. If any of the nominees declines to serve or becomes
    unavailable for any reason, or if a vacancy occurs before the
    election (although we know of no reason to anticipate that this
    will occur), the proxies may be voted for such substitute
    nominees as the Company may designate.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Nominees
    and Continuing Directors</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following individuals have been nominated for election to
    the Board of Directors or will continue to serve on the Board of
    Directors after the Annual Meeting:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>John McAdam</I>, age&#160;55, has served as our President,
    Chief Executive Officer and a director since July 2000. Prior to
    joining us, Mr.&#160;McAdam served as General Manager of the Web
    server sales business at International Business Machines
    Corporation from September 1999 to July 2000. From January 1995
    until August 1999, Mr.&#160;McAdam served as the President and
    Chief Operating Officer of Sequent Computer Systems, Inc., a
    manufacturer of high-end open systems, which was sold to
    International Business Machines Corporation in September 1999.
    Mr.&#160;McAdam holds a B.S. in Computer Science from the
    University of Glasgow, Scotland.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Karl D. Guelich</I>, age&#160;64, has served as one of our
    directors since June 1999 and as board chair from January 2003
    through April 2004. Mr.&#160;Guelich has been in private
    practice as a certified public accountant since his retirement
    from Ernst&#160;&#38; Young LLP in 1993, where he served as the
    Area Managing Partner for the Pacific Northwest offices
    headquartered in Seattle from October 1986 to November 1992.
    Mr.&#160;Guelich holds a B.S. in Accounting from Arizona State
    University.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Alan J. Higginson</I>, age&#160;59, has served as board chair
    since April 2004, and as one of our directors since May 1996.
    Mr.&#160;Higginson has been the President and Chief Executive
    Officer of Hubspan, Inc., an
    <FONT style="white-space: nowrap">e-business</FONT>
    infrastructure provider, since August 2001. From November 1995
    to November 1998, Mr.&#160;Higginson served as President of
    Atrieva Corporation, a provider of advanced data backup and
    retrieval technology. Mr.&#160;Higginson holds a B.S. in
    Commerce and an M.B.A. from the University of Santa&#160;Clara.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Keith D. Grinstein</I>, age&#160;46, has served as one of our
    directors since December 1999. He also serves as board chair for
    Coinstar, Inc., a coin counting machine company, and as lead
    outside director for Nextera, Inc.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    2
</DIV><!-- END LOGICAL PAGE -->
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    an economics-consulting firm. Mr.&#160;Grinstein is a partner of
    Second Avenue Partners, LLC, a venture capital fund.
    Mr.&#160;Grinstein&#146;s past experience includes serving as
    President, Chief Executive Officer and Vice Chair of Nextel
    International Inc., and as President and Chief Executive Officer
    of the Aviation Communications Division of AT&#38;T Wireless
    Services Inc. Mr.&#160;Grinstein holds a B.A. from Yale
    University and a J.D. from Georgetown University.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Rich Malone</I>, age&#160;58, has served as one of our
    directors since August 2003. Mr.&#160;Malone joined Edward Jones
    Investments as a General Principal in 1979. He served as a
    member of the firm&#146;s management committee from 1985 and the
    executive committee from 1995 until his retirement in December
    2006. He also served as Chief Information Officer of Edward
    Jones Investments from 1979 through December 2006.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>A.&#160;Gary Ames, </I>age&#160;62, has served as one of our
    directors since July 2004. Mr.&#160;Ames served as President and
    Chief Executive Officer of MediaOne International, a provider of
    broadband and wireless communications from July 1995 until his
    retirement in June of 2000. From January 1990 to July 1995, he
    served as President and Chief Executive Officer of U S West
    Communications, a regional provider of residential and business
    telephone services, and operator and carrier services.
    Mr.&#160;Ames also serves as director of Albertsons, Inc.,
    Tektronix, Inc., and iPass, Inc.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Deborah L. Bevier</I>, age&#160;55, was appointed as one of
    our directors in July 2006. Ms.&#160;Bevier is a principal of
    D.L. Bevier Consulting LLC, an organizational and management
    consulting firm, and has been president of Waldron Consulting, a
    division of Waldron&#160;&#38; Co., an organizational and
    management consulting firm, since July 2004. Prior to that time,
    from 1996 until 2003, Ms.&#160;Bevier served as a director,
    president and chief executive officer of Laird Norton Financial
    Group and its predecessor companies, an independent financial
    advisory services firm. From 1973 to 1996, Ms.&#160;Bevier held
    numerous leadership positions with Key Bank of Washington,
    including chairman and chief executive officer. Ms.&#160;Bevier
    currently serves on the board of directors of Fisher
    Communications, Inc., a media and communications company,
    Coinstar, Inc., and Puget Sound Bank. Ms.&#160;Bevier holds a
    B.S. in Economics from the State University of New York and a
    graduate degree from Stonier Graduate School of Banking at
    Rutgers University.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    There are no family relationships among any of the
    Company&#146;s directors or executive officers. None of the
    corporations or other organizations referred to in the
    biographical information set forth above is a parent, subsidiary
    or other affiliate of the Company.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Committees
    of the Board</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Board of Directors has standing Audit, Compensation and
    Nominating and Corporate Governance Committees (collectively,
    the &#147;Standing Committees&#148;). The charters of the
    Standing Committees are available on our website. A copy of the
    Amended and Restated Audit Committee charter is attached to this
    Proxy Statement as Appendix&#160;A and is incorporated herein by
    reference.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Audit Committee.</I>&#160;&#160;The Board of Directors has
    adopted a charter governing the duties and responsibilities of
    the Audit Committee. As described more fully in the charter, the
    functions of the Audit Committee are to select, evaluate and, if
    necessary, replace the Company&#146;s independent registered
    public accounting firm, to review and approve the planned scope,
    proposed fee arrangements and results of the annual audit,
    approve any proposed non-audit services to be provided by the
    independent registered public accounting firm, oversee the
    adequacy of accounting and financial controls, review the
    independence of the auditors, and oversee the Company&#146;s
    financial reporting process on behalf of the Board of Directors.
    The Audit Committee members have been Messrs.&#160;Guelich,
    Higginson and Grinstein since January 2004. The Board of
    Directors has determined that Mr.&#160;Guelich is an &#147;audit
    committee financial expert&#148; as defined in Item&#160;401(h)
    of
    <FONT style="white-space: nowrap">Regulation&#160;S-K.</FONT>
    Each current member of the Audit Committee is, and each member
    of the Audit Committee during fiscal year end 2006 was, an
    independent director as defined by the Nasdaq Marketplace Rules
    (as independence is currently defined in Rules&#160;4200(a)(15)
    and 4350(d) therein).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Compensation Committee.</I>&#160;&#160;The Compensation
    Committee&#146;s function is to recommend the compensation for
    the Chief Executive Officer and directors, including salaries,
    bonus levels and stock awards, and to review compensation
    proposals made by the Chief Executive Officer for the other
    executive officers. The
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    3
</DIV><!-- END LOGICAL PAGE -->
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Compensation Committee members have been Messrs.&#160;Ames,
    Grinstein and Guelich since July 2004. Each current member of
    the Compensation Committee is, and each member of the
    Compensation Committee during fiscal 2006 was, an independent
    director as defined by the Nasdaq Marketplace Rules.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Nominating and Corporate Governance
    Committee.</I>&#160;&#160;The Nominating and Corporate
    Governance Committee&#146;s function is to identify new board
    members, recommend board nominees, evaluate the board&#146;s
    performance, and provide oversight of corporate governance and
    ethical conduct. Since March 2005, the Nominating and Governance
    Committee has been composed of Messrs.&#160;Ames, Grinstein,
    Guelich, Higginson and Malone. Each current member of the
    Nominating and Governance Committee is, and each member of this
    committee during fiscal year end 2006 was, an independent
    director as defined by the Nasdaq Marketplace Rules.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Special Committee.</I>&#160;&#160;In addition, on
    May&#160;22, 2006, the Board of Directors formed a special
    committee of outside directors with broad authority to conduct a
    review of our stock option practices, including a review of our
    underlying stock option documentation and procedures (the
    &#147;Special Committee&#148;). The Special Committee was
    originally composed of Messrs.&#160;Guelich, Malone and Ames.
    Since July 2006, the Special Committee members were
    Mr.&#160;Ames and Ms.&#160;Bevier (who joined the Board of
    Directors on July&#160;14, 2006).
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Meetings
    of the Board and Standing Committees</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company&#146;s Board of Directors met or acted by unanimous
    written consent 17 times during fiscal 2006. The Audit Committee
    met 13 times and the Compensation Committee met or acted by
    unanimous written consent 9 times. During fiscal 2006, the
    Nominating and Corporate Governance Committee met 4 times. The
    outside directors met 5 times during fiscal 2006, with no
    members of management present. Each member of the Board of
    Directors attended 75% or more of the Board meetings during
    fiscal 2006. Each member of the Board who served on the Standing
    Committees attended at least 75% of the committee meetings.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Director
    Nomination</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Criteria for Nomination to the Board.</I>&#160;&#160;The
    Nominating and Corporate Governance Committee (the
    &#147;Nominating Committee&#148;) considers the appropriate
    balance of experience, skills and characteristics required of
    the Board of Directors, and seeks to insure that at least a
    majority of the directors are independent under the rules of the
    Nasdaq Stock Market, that members of the Company&#146;s audit
    committee meet the financial literacy requirements under the
    rules of the Nasdaq Stock Market and that at least one of them
    qualifies as an &#147;audit committee financial expert&#148;
    under the rules of the Securities and Exchange Commission.
    Nominees for director are selected on the basis of their depth
    and breadth of experience, integrity, the ability to work
    effectively as part of a team, understanding of the
    Company&#146;s business environment, and willingness to devote
    adequate time to Board duties.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Shareholders Proposals for Nominees.</I>&#160;&#160;The
    Nominating Committee will consider written proposals from
    shareholders for nominees for director. Any such nominations
    should be submitted to the Nominating Committee c/o&#160;the
    Secretary of the Company and should include the following
    information: (a)&#160;all information relating to such nominee
    that is required to be disclosed pursuant to Regulation&#160;14A
    under the Securities Exchange Act of 1934 (including such
    person&#146;s written consent to being named in the proxy
    statement as a nominee and to serving as a director if elected);
    (b)&#160;the name(s) and address(es) of the shareholders(s)
    making the nomination and the number of shares of Common Stock
    which are owned beneficially and of record by such
    shareholders(s); and (c)&#160;appropriate biographical
    information and a statement as to the qualification of the
    nominee, and should be submitted in the time frame described in
    the Bylaws of the Company and under the caption
    &#147;Shareholder Proposals for the Annual Meeting for Fiscal
    Year End 2007&#148; below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Process for Identifying and Evaluating
    Nominees.</I>&#160;&#160;The process for identifying and
    evaluating nominees to fill vacancies on the Board is initiated
    by conducting an assessment of critical Company and Board needs,
    based on the present and future strategic objectives of the
    Company and the specific skills required for the Board as a
    whole and for each Board Committee. A third-party search firm
    may be used by the Nominating Committee to identify qualified
    candidates. These candidates are evaluated by the Nominating
    Committee by
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    4
</DIV><!-- END LOGICAL PAGE -->
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    reviewing the candidates&#146; biographical information and
    qualification and checking the candidates&#146; references.
    Serious candidates meet with all members of the Board, and as
    many of the Company&#146;s executive officers as practical.
    Using the input from such interviews and the information
    obtained by the Nominating Committee, the full Board determines
    whether to appoint a candidate to the Board.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Nominating Committee will evaluate the skills and experience
    of existing Board members against the Company&#146;s critical
    needs in making recommendations for nomination by the full Board
    of candidates for election by the shareholders. The Nominating
    Committee charter is available on the investor relations section
    of the Company&#146;s website, www.f5.com. Each current member
    of the Nominating Committee is an independent director as
    defined by the Nasdaq Marketplace Rules. The nominees to the
    Board of Directors described in this Proxy Statement were
    approved by at least a majority of Company&#146;s independent
    directors, including each member of the Nominating Committee.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Nominating Committee expects that a similar process will be
    used to evaluate nominees recommended by shareholders. However,
    to date, the Company has not received any shareholder&#146;s
    proposal to nominate a director.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Compensation
    of Directors</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Board of Directors conducts an annual review of the
    Company&#146;s director compensation policies and retains the
    services of outside professional consultants to assist in this
    review.  Non-employee directors of the Company are currently
    paid $30,000 annually for their services as members of the Board
    of Directors. Chairs of the Audit, Compensation and Nominating
    and Corporate Governance Committees are paid an additional
    $10,000, $5,000 and $2,500, respectively, annually. The Chairman
    of the Board of Directors receives an additional $12,000 paid
    annually. In addition, the non-employee directors of the Company
    are paid $1,000 for each in-person board meeting. Members of the
    Standing Committees, as well as any special committee or ad hoc
    committee established by the Board of Directors, are paid $750
    for each in-person or teleconference committee meeting. Members
    of the Board of Directors who are also employees of the Company
    did not receive any compensation for their services as members
    of the Board.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    All non-employee directors are reimbursed for certain expenses
    in connection with attending board and committee meetings.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Prior to February&#160;24, 2005, each non-employee director
    received an annual option to purchase 15,000&#160;shares of
    Common Stock on the day of the Company&#146;s annual meeting.
    These options were fully vested and exercisable on the date of
    grant, and had an exercise price equal to the closing price of
    the Common Stock on the date of grant. Messrs.&#160;Higginson,
    Guelich, Grinstein, and Malone were each granted options to
    purchase 15,000&#160;shares of Common Stock under the
    Company&#146;s Amended and Restated 1998 Equity Incentive Plan
    (the &#147;1998 Plan&#148;) in April 2004 at a per share
    exercise price of $28.10. Mr.&#160;Ames was granted an option to
    purchase 15,000&#160;shares of Common Stock under the 1998 Plan
    in July 2004 when he joined the Board of Directors at a per
    share exercise price of $23.07.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Between February&#160;24, 2005 and March&#160;2, 2006, each
    non-employee director received equity compensation consisting of
    an annual option to purchase 7,500&#160;shares of Common Stock
    (the &#147;Prior Annual Director Options&#148;). The Prior
    Annual Director Options fully vested at the end of one year of
    continuous services as a director following the date of grant
    and had a per share exercise price equal to the closing price of
    the Common Stock on the date of grant. During such period, each
    non-employee director also received additional equity
    compensation consisting of restricted stock units
    (&#147;RSUs&#148;) representing the right to receive
    2,500&#160;shares of Common Stock (the &#147;Prior Annual
    RSUs&#148;) under the 2005 Plan. Except with respect to the
    first RSU grant to non-employee directors pursuant to this
    arrangement, such RSUs fully vested at the end of one year of
    continuous service as a director following the date of grant. On
    February&#160;24, 2005, the Company&#146;s non-employee
    directors received their fiscal year 2005 Prior Annual Director
    Options, which options fully vested on February&#160;24, 2006
    (assuming the director was providing continuous service at such
    time) and had a per share exercise price of $53.73. On
    August&#160;1, 2005, each non-employee director received their
    fiscal year 2005 Prior Annual RSUs, which RSUs fully vested on
    March&#160;2, 2006 (assuming a director was providing continuous
    service as a director at such time).
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    5
</DIV><!-- END LOGICAL PAGE -->
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On March&#160;2, 2006, the Board of Directors, at the
    recommendation of the Compensation Committee, approved a change
    to our director compensation policies. Under the new
    compensation arrangement, each non-employee director will
    receive an annual grant of RSUs representing the right to
    receive 5,000&#160;shares of Common Stock under the 2005 Equity
    Incentive Plan (the &#147;Annual RSU Grant&#148;). The
    non-employee directors will no longer receive the Prior Annual
    Director Options or the Prior Annual RSUs. Except with respect
    to the first RSU grant to non-employee directors pursuant to
    this arrangement, such RSUs will be fully vested at the end of
    one year of continuous service as a director following the date
    of grant. On March&#160;2, 2006, each non-employee director,
    other than Ms.&#160;Bevier, received his first grant of 5,000
    RSUs under this arrangement, which RSUs were for fiscal year
    2006 and will fully vest on the day prior to the date of the
    annual shareholder meeting for fiscal year 2006 to be held in
    2007 (assuming a director is providing continuous service as a
    director at such time). Ms.&#160;Bevier received her first grant
    of 5,000 RSUs under this arrangement on July&#160;14, 2006 for
    fiscal year 2006, which RSUs will also fully vest on the day
    prior to the date of the annual shareholder meeting for fiscal
    year 2006 to be held in 2007 (assuming Ms.&#160;Bevier is
    providing continuous service as a director at such time).
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Communications
    with Directors; Attendance at Annual Meetings</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Shareholders who wish to communicate with our Directors to
    report complaints or concerns related to accounting, internal
    accounting controls or auditing may do so by contacting them
    c/o&#160;Corporate Secretary, F5&#160;Networks, Inc., 401
    Elliott Avenue West, Seattle, Washington 98119. These
    communications will be forwarded to the Board or individual
    Board members as appropriate. Directors are expected to be
    present at the Company&#146;s annual meeting of shareholders.
    All the Directors attended the Company&#146;s fiscal year end
    2005 Annual Meeting.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Legal
    Proceedings</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Beginning on or about May&#160;24, 2006, several derivative
    actions were filed against certain current and former directors
    and officers of the Company. These derivative lawsuits were
    filed in: (1)&#160;the Superior Court of King County,
    Washington, as Adams&#160;v. Amdahl, et&#160;al. (Case
    <FONT style="white-space: nowrap">No.&#160;06-2-17195-1</FONT>
    SEA), Wright&#160;v. Amdahl, et&#160;al. (Case
    <FONT style="white-space: nowrap">No.&#160;06-2-19159-5</FONT>
    SEA), and Sommer&#160;v. McAdam, et&#160;al. (Case
    <FONT style="white-space: nowrap">No.&#160;06-2-26248-4</FONT>
    SEA); and (2)&#160;in the U.S.&#160;District Court for the
    Western District of Washington, as In re F5 Networks, Inc.
    Derivative Litigation, Master File
    <FONT style="white-space: nowrap">No.&#160;C06-0794RSL,</FONT>
    which consolidates Hutton&#160;v. McAdam, et&#160;al. (Case
    <FONT style="white-space: nowrap">No.&#160;06-794RSL),</FONT>
    Locals 302 and 612 of the International Union of Operating
    Engineers-Employers Construction Industry Retirement
    Trust&#160;v. McAdam et&#160;al. (Case
    <FONT style="white-space: nowrap">No.&#160;C06-1057RSL),</FONT>
    and Easton&#160;v. McAdam et&#160;al. (Case
    <FONT style="white-space: nowrap">No.&#160;C06-1145RSL).</FONT>
    The complaints generally allege that certain of the
    Company&#146;s current and former directors and officers,
    including, in general, each of the Company&#146;s current
    outside directors (other than Ms.&#160;Bevier),
    Messrs.&#160;McAdam, Hull and Eames, breached their fiduciary
    duties to the Company by engaging in alleged wrongful conduct
    concerning the manipulation of certain stock option grant dates.
    The Company is named solely as a nominal defendant against whom
    the plaintiffs seek no recovery. Due to the inherent
    uncertainties of litigation, we are unable to predict the
    outcome of these matters at this time.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    6
</DIV><!-- END LOGICAL PAGE -->
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<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->


<!-- link1 "SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT" -->
<DIV align="left"><A NAME="002"></A></DIV>


<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">SECURITY
    OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth information regarding the
    beneficial ownership of shares of Common Stock as of
    January&#160;16, 2007 by (a)&#160;each person known to the
    Company to own beneficially more than 5% of outstanding shares
    of Common Stock on January&#160;16, 2007, (b)&#160;each director
    and nominee for director of the Company, (c)&#160;the Named
    Executive Officers, as defined herein, and (d)&#160;all
    directors and executive officers as a group. The information in
    this table is based solely on statements in filings with the SEC
    or other reliable information.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="73%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Number of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Shares of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Common Stock<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Percent of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Beneficially<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Common Stock<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name and Address(1)</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Owned(2)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Outstanding(2)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">FMR Corp. and its affiliates(3)
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,912,921
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    14.3
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">82 Devonshire Street<BR>
    Boston, Massachusetts 02109
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">Wellington Management Company,
    LLP(4)
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,401,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5.8
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">75 State Street <BR>
    Boston, Massachusetts 02109
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">John McAdam(5)
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    111,561
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">Tom Hull(6)
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    92,014
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">Edward J. Eames(7)
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,129
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">Dan Matte(8)
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,602
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">Karl Triebes(9)
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    71,102
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">A. Gary Ames(10)
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    15,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">Deborah Bevier
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">Keith D. Grinstein(11)
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    21,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">Karl D. Guelich(12)
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">Alan J. Higginson(13)
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    62,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">Rich Malone(14)
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    40,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">All directors and executive
    officers as a group (14 people)(15)
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    470,877
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.1
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%; align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=60 -->

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="5%"></TD>
    <TD width="1%"></TD>
    <TD width="94%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    *&#160;</TD>
    <TD></TD>
    <TD valign="bottom">
    less than 1%.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Unless otherwise indicated, the address of each of the named
    individuals is c/o&#160;F5 Networks, Inc., 401 Elliott Avenue
    West, Seattle, Washington 98119.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    Beneficial ownership of shares is determined in accordance with
    the rules of the SEC and generally includes any shares over
    which a person exercises sole or shared voting or investment
    power, or of which a person has the right to acquire ownership
    within 60&#160;days after January&#160;16, 2007. Except as
    otherwise noted, each person or entity has sole voting and
    investment power with respect to the shares shown.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    The holding shown is as reported by FMR Corp. (&#147;FMR&#148;)
    in a Schedule 13G/A filed on February&#160;14, 2006. Includes
    5,890,321&#160;shares beneficially owned by Fidelity
    Management&#160;&#38; Research Company (&#147;Fidelity&#148;), a
    wholly owned subsidiary of FMR, as a result of its serving as an
    investment advisor to various investment companies (the
    &#147;Funds&#148;). One of the Funds, Fidelity Growth Company
    Fund, has ownership of 3,845,723 of theses shares. Edward C.
    Johnson 3d, Chairman of FMR, FMR through its control of
    Fidelity, and the Funds each has sole power to dispose of the
    5,890,321&#160;shares owned by the Funds. Neither FMR nor Edward
    C. Johnson 3d has the sole power to vote or direct the voting of
    the shares owned directly by the Funds, which power resides with
    the Funds&#146; Boards of Trustees. Fidelity carries out the
    voting of the shares under written guidelines established by the
    Funds&#146; Boards of Trustees. Also includes 22,600&#160;shares
    beneficially owned by Fidelity Management Trust Company, a
    wholly owned subsidiary of FMR, as a result of its serving as
    Investment Manager of institutional accounts. Edward C. Johnson
    3d and FMR, through its control of Fidelity Management Trust
    Company, each has sole dispositive power over 22,600&#160;shares
    and sole power to vote or to direct the voting of
    22,600&#160;shares, and no power to vote or to direct the voting
    of 22,600&#160;shares owned by the institutional account(s). FMR
    Corp. has sole voting power with respect to 22,600&#160;shares
    and sole dispositive power with respect to 5,912,921&#160;shares.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    7
</DIV><!-- END LOGICAL PAGE -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="5%"></TD>
    <TD width="1%"></TD>
    <TD width="94%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (4) </TD>
    <TD></TD>
    <TD valign="bottom">
    The holding shown is as reported by Wellington Management
    Company, LLP (&#147;Wellington Management&#148;) in a
    Schedule&#160;13G filed on February&#160;14, 2006. Wellington
    Management, in its capacity as investment adviser, may be deemed
    to beneficially own 2,401,000&#160;shares that are held of
    record by clients of Wellington Management. Wellington
    Management has shared voting power with respect to
    2,118,020&#160;shares and sole dispositive power with respect to
    2,401,000&#160;shares.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (5) </TD>
    <TD></TD>
    <TD valign="bottom">
    Includes 22,623&#160;shares of Common Stock underlying RSUs
    granted under the 2005 Equity Incentive Plan that are issuable
    within 60&#160;days of January&#160;16, 2007.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (6) </TD>
    <TD></TD>
    <TD valign="bottom">
    Includes 77,500&#160;shares issuable upon exercise of options
    currently exercisable or exercisable within 60&#160;days of
    January&#160;16, 2007 and 6,102&#160;shares of Common Stock
    underlying RSUs granted under the 2005 Equity Incentive Plan
    that are issuable within 60&#160;days of January&#160;16, 2007.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (7) </TD>
    <TD></TD>
    <TD valign="bottom">
    Includes 6,102&#160;shares of Common Stock underlying RSUs
    granted under the 2005 Equity Incentive Plan that are issuable
    within 60&#160;days of January&#160;16, 2007.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (8) </TD>
    <TD></TD>
    <TD valign="bottom">
    Includes 6,727&#160;shares of Common Stock underlying RSUs
    granted under the 2005 Equity Incentive Plan that are issuable
    within 60&#160;days of January&#160;16, 2007.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (9) </TD>
    <TD></TD>
    <TD valign="bottom">
    Includes 62,500&#160;shares issuable upon exercise of options
    currently exercisable or exercisable within 60&#160;days of
    January&#160;16, 2007 and 6,102&#160;shares of Common Stock
    underlying RSUs granted under the 2005 Equity Incentive Plan
    that are issuable within 60&#160;days of January&#160;16, 2007.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (10) </TD>
    <TD></TD>
    <TD valign="bottom">
    Includes 12,500&#160;shares issuable upon exercise of options
    currently exercisable or exercisable within 60&#160;days of
    January&#160;16, 2007.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (11) </TD>
    <TD></TD>
    <TD valign="bottom">
    Includes 12,500&#160;shares issuable upon exercise of options
    currently exercisable or exercisable within 60&#160;days of
    January&#160;16, 2007.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (12) </TD>
    <TD></TD>
    <TD valign="bottom">
    Includes 7,500&#160;shares issuable upon exercise of options
    currently exercisable or exercisable within 60&#160;days of
    January&#160;16, 2007.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (13) </TD>
    <TD></TD>
    <TD valign="bottom">
    Includes 60,000&#160;shares issuable upon exercise of options
    currently exercisable or exercisable within 60&#160;days of
    January&#160;16, 2007.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (14) </TD>
    <TD></TD>
    <TD valign="bottom">
    Includes 37,500&#160;shares issuable upon exercise of options
    currently exercisable or exercisable within 60&#160;days of
    January&#160;16, 2007.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (15) </TD>
    <TD></TD>
    <TD valign="bottom">
    Includes 270,000&#160;shares issuable upon exercise of options
    currently exercisable or exercisable within 60&#160;days of
    January&#160;16, 2007 and 54,206&#160;shares of Common Stock
    underlying RSUs granted under the 2005 Equity Incentive Plan
    that are issuable within 60&#160;days of January&#160;16, 2007.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Certain
    Relationships and Related Party Transactions</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company&#146;s Second Amended and Restated Articles of
    Incorporation (the &#147;Articles&#148;) limit the liability of
    the Company&#146;s directors for monetary damages arising from
    their conduct as directors, except to the extent otherwise
    required by the Articles and the Washington Business Corporation
    Act. The Articles also provide that the Company may indemnify
    its directors and officers to the fullest extent permitted by
    Washington law, including in circumstances in which
    indemnification is otherwise discretionary under Washington law.
    The Company has entered into indemnification agreements with the
    Company&#146;s directors and certain officers for the
    indemnification of and advancement of expenses to these persons
    to the fullest extent permitted by law. The Company also intends
    to enter into these agreements with the Company&#146;s future
    directors and certain future officers.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Pursuant to these indemnification agreements, the Company has
    advanced or indemnified certain current and former directors and
    officers for fees and expenses incurred by them in connection
    with the Special Committee&#146;s review of the Company&#146;s
    stock option practices, including a review of our underlying
    stock option documentation and procedures, and the previously
    disclosed restatement of the Company&#146;s financial statement,
    legal proceedings and other matters related to the
    Company&#146;s stock option practices, all as described in the
    Company&#146;s annual report on
    <FONT style="white-space: nowrap">Form&#160;10-K</FONT>
    for the fiscal year ended September&#160;30, 2006, which is
    being mailed to shareholders of the Company with this proxy
    statement.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    8
</DIV><!-- END LOGICAL PAGE -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Equity
    Compensation Plan Information</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table provides information as of
    September&#160;30, 2006 with respect to the shares of Common
    Stock that may be issued under the Company&#146;s existing
    equity compensation plans.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="47%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="18%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="13%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Column C</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Number of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>securities remaining <BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>available for<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Column A</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>future issuance<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Number of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>under equity<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>securities to<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>compensation plans <BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>be issued<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Column B</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(total securities<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>upon exercise<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Weighted-average exercise<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>authorized but<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>of outstanding<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>price of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>unissued under<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>options and<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>outstanding options<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>the plans,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Plan Category</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>rights</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>and rights</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>less Column A)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">Equity compensation plans approved
    by security holders(1)(6)
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,647,404
</TD>
<TD nowrap align="left" valign="bottom">
    (2)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    36.27
</TD>
<TD nowrap align="left" valign="bottom">
    (3)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,427,535
</TD>
<TD nowrap align="left" valign="bottom">
    (4)
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">Equity compensation plans not
    approved by security holders(5)(7)
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,024,996
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    24.30
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    70,504
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <FONT style="font-size: 10pt">Total(8)
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,672,400
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    29.52
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,498,039
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%; align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=60 -->

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="1%"></TD>
    <TD width="95%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Consists of the F5 Networks, Inc. Amended and Restated 1996
    Stock Option Plan (the &#147;1996 Equity Incentive Plan), the F5
    Networks, Inc. Amended and Restated 1998 Equity Incentive Plan
    (the &#147;1998 Equity Incentive Plan&#148;), and the 2005
    Equity Incentive Plan. No additional options may be granted
    under the 1996 Equity Incentive Plan.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    Includes 855,482&#160;shares issuable upon vesting of
    outstanding RSUs granted under the 2005 Equity Incentive Plan.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    The weighted-average exercise price does not take into account
    the shares issuable upon vesting of outstanding RSUs, which have
    no exercise price.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (4) </TD>
    <TD></TD>
    <TD valign="bottom">
    Includes 876,814&#160;shares reserved for issuance under the F5
    Networks, Inc. Employee Stock Purchase Plan, (the &#147;Employee
    Stock Purchase Plan&#148;).</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (5) </TD>
    <TD></TD>
    <TD valign="bottom">
    Consists of the F5 Networks, Inc. 2000 Employee Equity Incentive
    Plan (the &#147;2000 Equity Incentive Plan&#148;), F5 Networks,
    Inc. uRoam Acquisition Equity Incentive Plan (the &#147;uRoam
    Equity Incentive Plan&#148;), F5 Networks, Inc. MagniFire
    Acquisition Equity Incentive Plan (the &#147;MagniFire Equity
    Incentive Plan&#148;) and certain executive new hire grants. The
    material features of each of these equity compensation plans are
    set forth below. No additional options may be granted under the
    uRoam Equity Incentive Plan or the MagniFire Equity Incentive
    Plan.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (6) </TD>
    <TD></TD>
    <TD valign="bottom">
    As of January&#160;16, 2007, for equity compensation plans
    approved by security holders, the number of securities to be
    issued upon exercise of outstanding options and rights totaled
    1,598,705, at a weighted-average exercise price of $36.49. This
    total included 876,872&#160;shares issuable upon vesting of
    outstanding RSUs granted under the 2005 Equity Incentive Plan.
    As of January&#160;16, 2007, the number of securities remaining
    available for future issuance under these equity compensation
    plans totaled 1,102,662, which includes 810,161&#160;shares
    reserved for issuance under the Employee Stock Purchase Plan.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (7) </TD>
    <TD></TD>
    <TD valign="bottom">
    As of January&#160;16, 2007, for equity compensation plans not
    approved by security holders, the number of securities to be
    issued upon exercise of outstanding options and rights totaled
    911,721, at a weighted-average exercise price of $23.93. As of
    January&#160;16, 2007, the number of securities remaining
    available for future issuance under these equity compensation
    plans totaled 74,118.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (8) </TD>
    <TD></TD>
    <TD valign="bottom">
    As of January&#160;16, 2007, for all equity compensation plans,
    the number of securities to be issued upon exercise of
    outstanding options and rights totaled 2,510,426, at a
    weighted-average exercise price of $29.48. As of
    January&#160;16, 2007, the number of securities remaining
    available for future issuance under all equity compensation
    plans totaled 1,176,780, which includes 810,161&#160;shares
    reserved for issuance under the Employee Stock Purchase Plan.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    9
</DIV><!-- END LOGICAL PAGE -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Description
    of Plans not Approved by Security Holders</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>2000 Equity Incentive Plan.</I>&#160;&#160;In July 2000, the
    Board of Directors adopted the 2000 Equity Incentive Plan, which
    provides for discretionary grants of non-qualified stock
    options, stock purchase awards and stock bonuses for employees
    and other service providers. A total of 3,500,000&#160;shares of
    Common Stock have been reserved for issuance under the 2000
    Equity Incentive Plan. As of September&#160;30, 2006, there were
    options to purchase 583,218&#160;shares outstanding and
    70,504&#160;shares available for awards under the 2000 Equity
    Incentive Plan.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    All options under the 2000 Equity Incentive Plan expire
    10&#160;years from the grant date and each option will have an
    exercise price of not less than the fair market value of the
    Company&#146;s stock on the date the option is granted. The
    options granted under the 2000 Equity Incentive Plan may be
    exercisable immediately or may vest and become exercisable in
    periodic installments. In the event of the termination of an
    optionee&#146;s employment with the Company, vesting of options
    will stop and the optionee may exercise vested options for a
    specified period of time after the termination. Upon certain
    changes in control of the Company, 50% of all outstanding and
    unvested options or stock awards under the 2000 Equity Incentive
    Plan will vest and become immediately exercisable, unless
    assumed or substituted by the acquiring entity.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>uRoam Equity Incentive Plan.</I>&#160;&#160;In July 2003, the
    Board of Directors adopted the uRoam Equity Incentive Plan in
    connection with the hiring of the former employees of uRoam,
    Inc. The plan provides for discretionary grants of non-qualified
    and incentive stock options, stock purchase awards and stock
    bonuses. The Board of Directors approved 250,000&#160;shares of
    Common Stock to be reserved for issuance under the uRoam Equity
    Incentive Plan. As of September&#160;30, 2006, there were
    options to purchase 26,236&#160;shares outstanding and no shares
    were available for awards under the uRoam Equity Incentive Plan.
    Options that expire, whether due to a termination of employment
    or otherwise, are not available for future grant.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    All options under the uRoam Equity Incentive Plan expire
    10&#160;years from the grant date and were granted as
    non-qualified stock options with an exercise price equal to the
    fair market value of the Common Stock on the date of grant. The
    options granted under the uRoam Equity Incentive Plan may be
    exercisable immediately or may vest and become exercisable in
    periodic installments. In the event of the termination of an
    optionee&#146;s employment with the Company, vesting of options
    will stop and the optionee may exercise vested options for a
    specified period of time after the termination. Upon certain
    changes in control of the Company, 50% of all outstanding and
    unvested options or stock awards under the uRoam Equity
    Incentive Plan will vest and become immediately exercisable,
    unless assumed or substituted by the acquiring entity.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>MagniFire Equity Incentive Plan.</I>&#160;&#160;In July 2004,
    the Board of Directors adopted the MagniFire Equity Incentive
    Plan in connection with the hiring of the former employees of
    MagniFire Websystems, Inc. The plan provides for discretionary
    grants of non-qualified and incentive stock options, stock
    purchase awards and stock bonuses. The Board of Directors
    approved 415,000&#160;shares of Common Stock to be reserved for
    issuance under the MagniFire Equity Incentive Plan. As of
    September&#160;30, 2006, there were options to purchase
    131,792&#160;shares outstanding and no shares were available for
    awards under the MagniFire Equity Incentive Plan. Options that
    expire, whether due to a termination of employment or otherwise,
    are not available for future grant.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    All options under the MagniFire Equity Incentive Plan expire
    10&#160;years from the grant date and were granted as
    non-qualified stock options with an exercise price equal to the
    fair market value of the Common Stock on the date of grant. The
    options granted under the MagniFire Equity Incentive Plan may be
    exercisable immediately or may vest and become exercisable in
    periodic installments. In the event of the termination of an
    optionee&#146;s employment with the Company, vesting of options
    will stop and the optionee may exercise vested options for a
    specified period of time after the termination. Upon certain
    changes in control of the Company, 50% of all outstanding and
    unvested options or stock awards under the MagniFire Equity
    Incentive Plan will vest and become immediately exercisable,
    unless assumed or substituted by the acquiring entity.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>New Hire Grants.</I>&#160;&#160;In October 2003, the Board of
    Directors adopted a non-qualified stock option plan, or the
    &#147;Hull Plan&#148;, in connection with the hiring of Tom
    Hull, the Company&#146;s Senior Vice President of Worldwide
    Sales. The Hull Plan provides for a grant of 225,000
    non-qualified stock options for Mr.&#160;Hull and these options
    have an exercise price per share of $23.69. As of
    September&#160;30, 2006, there were options to
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    10
</DIV><!-- END LOGICAL PAGE -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    purchase 115,000&#160;shares outstanding and no shares available
    for grant under this plan. In August 2004, the Board of
    Directors adopted a non-qualified stock option plan, or the
    &#147;Triebes Plan&#148;, in connection with the hiring of Karl
    Triebes, the Company&#146;s Senior Vice President of Product
    Development and Chief Technology Officer. The Triebes Plan
    provides for a grant of 300,000 non-qualified stock options for
    Mr.&#160;Triebes and these options have an exercise price per
    share of $22.81. As of September&#160;30, 2006, there were
    options to purchase 168,750&#160;shares outstanding and no
    shares available for grant under this plan.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    All options under these plans expire 10&#160;years from the
    grant date and each plan specifies the exercise price of options
    granted under the plan. The options granted under the plans vest
    and become exercisable in periodic installments over a period of
    up to 4&#160;years from the grant date. In the event of the
    termination of an optionee&#146;s employment with the Company,
    vesting of options will stop and the optionee may exercise
    vested options for a specified period of time after the
    termination. Upon certain changes in control of the Company,
    100% of all outstanding and unvested options under the Hull Plan
    and Triebes Plan, will vest and become immediately exercisable.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Section&#160;16
    (a)&#160;Beneficial Ownership Reporting Compliance</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Under SEC rules, the Company&#146;s directors, executive
    officers and beneficial owners of more than 10% of any class of
    equity security are required to file periodic reports of their
    ownership, and changes in that ownership, with the SEC. Such
    persons are required by SEC regulations to furnish us with
    copies of all Section&#160;16(a) forms filed by such person.
    Based solely on its review of copies of these reports and
    representations of such reporting persons, the Company believes
    that, during fiscal 2006, all such SEC filing requirements were
    satisfied with the following exceptions; executive officers Andy
    Reinland, John Rodriguez and Karl Triebes each filed one late
    Form&#160;4 with respect to a reportable transaction during
    fiscal 2006.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    11
</DIV><!-- END LOGICAL PAGE -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">EXECUTIVE
    COMPENSATION AND OTHER MATTERS</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Summary
    Executive Compensation Table</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth information concerning
    compensation earned for services rendered to us by (a)&#160;our
    Chief Executive Officer (the &#147;CEO&#148;), and (b)&#160;our
    four other most highly compensated executive officers who were
    serving as our executive officers at the end of fiscal year end
    2006. These executive officers, together with the CEO, are
    collectively referred to as the &#147;Named Executive
    Officers.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 9pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="39%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=07 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=07 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=07 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=08 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=08 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=08 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=08 type=hang1 -->
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Annual Compensation</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Long Term Compensation Awards</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Other Annual<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Restricted<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Securities<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>All Other<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Salary<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Bonus(1)<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Compensation<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Stock<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Underlying<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Compensation(2)<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name and Principal Position</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Year</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Awards</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Options (#)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    <FONT style="font-size: 9pt">John McAdam
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2006
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    495,757
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    389,104
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    789
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 8pt">
    <FONT style="font-size: 9pt">President and
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2005
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    467,470
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    445,360
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,108,500
</TD>
<TD nowrap align="left" valign="bottom">
    (3)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    789
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 8pt">
    <FONT style="font-size: 9pt">Chief Executive Officer
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2004
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    445,200
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    449,402
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    100,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    789
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    <FONT style="font-size: 9pt">Tom Hull
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2006
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    275,711
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    173,134
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,789
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 8pt">
    <FONT style="font-size: 9pt">Senior VP of Worldwide Sales
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2005
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    259,992
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    198,167
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    843,400
</TD>
<TD nowrap align="left" valign="bottom">
    (4)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,789
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2004
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    238,826
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    194,858
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    265,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6,173
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    <FONT style="font-size: 9pt">Edward Eames
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2006
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    267,574
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    168,092
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,789
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 8pt">
    <FONT style="font-size: 9pt">Senior VP of Business
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2005
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    252,428
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    192,396
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    843,400
</TD>
<TD nowrap align="left" valign="bottom">
    (4)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,789
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 8pt">
    <FONT style="font-size: 9pt">Operations
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2004
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    240,408
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    194,141
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    40,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,789
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    <FONT style="font-size: 9pt">Dan Matte
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2006
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    190,576
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    119,721
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,789
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 8pt">
    <FONT style="font-size: 9pt">Senior VP of Marketing
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2005
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    173,256
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    132,048
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,358,540
</TD>
<TD nowrap align="left" valign="bottom">
    (5)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,789
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2004
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    156,901
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    75,406
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,789
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    <FONT style="font-size: 9pt">Karl Triebes(6)
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2006
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    323,300
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    169,250
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,789
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 8pt">
    <FONT style="font-size: 9pt">Senior VP of Product
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2005
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    305,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    190,544
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    843,400
</TD>
<TD nowrap align="left" valign="bottom">
    (4)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    100,679
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 8pt">
    <FONT style="font-size: 9pt">Development and Chief
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2004
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    27,763
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    125,070
</TD>
<TD nowrap align="left" valign="bottom">
    (7)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    300,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 8pt">
    <FONT style="font-size: 9pt">Technology Officer
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%; align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=60 -->

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="1%"></TD>
    <TD width="95%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Includes bonus amounts earned during the fiscal year.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    The amounts in this column for fiscal year 2006 include
    (a)&#160;$3,000 for an annual contribution by the Company to the
    401(k) account of each of Messrs.&#160;Hull, Eames, Matte and
    Triebes, (b)&#160;imputed income of $189 for term life insurance
    premiums paid by the Company for each of Messrs.&#160;McAdam,
    Hull, Eames, Matte and Triebes, and (c)&#160;imputed income of
    $600 paid by the Company as a stipend for Internet service
    provider fees with respect to Messrs.&#160;McAdam, Hull, Eames,
    Matte and Triebes. The amounts in this column for fiscal year
    2005 include (a)&#160;$3,000 for an annual contribution by the
    Company to the 401(k) account of each of Messrs.&#160;Hull,
    Eames, Matte and Triebes, (b)&#160;imputed income of $189 for
    term life insurance premiums paid by the Company for each of
    Messrs.&#160;McAdam, Hull, Eames, Matte and Triebes, and
    (c)&#160;imputed income of $600 paid by the Company as a stipend
    for Internet service provider fees with respect to
    Messrs.&#160;McAdam, Hull, Eames, Matte and Triebes. The amounts
    in this column for fiscal year 2004 include (a)&#160;$3,000 for
    an annual contribution by the Company to the 401(k) account of
    each of Messrs.&#160;Hull, Eames and Matte, (b)&#160;imputed
    income of $189 for term life insurance premiums paid by the
    Company for each of Messrs.&#160;McAdam, Eames and Matte,
    (c)&#160;imputed income of $173 for a term life insurance
    premium paid by the Company for Mr.&#160;Hull, and
    (d)&#160;imputed income of $600 paid by the Company as a stipend
    for Internet service provider fees with respect to
    Messrs.&#160;McAdam, Eames and Matte.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    Represents the aggregate value on date of grant of an RSU award
    made on August&#160;1, 2005 with respect to 50,000&#160;shares
    of Common Stock based on the closing market price of the Common
    Stock on that date. This RSU award, which was the only RSUs held
    by the holder as of September&#160;30, 2005, vests at the rate
    of 12.5% upon completion of each quarter of continuous
    employment of the holder following the date of grant until such
    RSU is fully vested on August&#160;1, 2007. As of
    September&#160;30, 2006, 25,000 of these RSUs had vested. The
    unvested portion of each RSU award is subject to forfeiture if
    the holder&#146;s employment terminates. The holder of the RSU
    award does not have any of the benefits of ownership of the
    shares of </TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    12
</DIV><!-- END LOGICAL PAGE -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="1%"></TD>
    <TD width="95%"></TD>
</TR>

<TR>
    <TD valign="top">
</TD>
    <TD></TD>
    <TD valign="bottom">
    Common Stock subject to the award, such as the right to vote the
    shares or to receive dividends, unless and until the RSU vests
    and the shares are issued.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (4) </TD>
    <TD></TD>
    <TD valign="bottom">
    Represents the aggregate value on date of grant of an RSU award
    made on August&#160;1, 2005 with respect to 20,000&#160;shares
    of Common Stock based on the closing market price of Common
    Stock on that date. This RSU award, which was the only RSUs held
    by the holder as of September&#160;30, 2005, vests at the rate
    of 12.5% upon completion of each quarter of continuous
    employment of the holder following the date of grant until such
    RSU is fully vested on August&#160;1, 2007. As of
    September&#160;30, 2006, 10,000 of these RSUs had vested. The
    unvested portion of each RSU award is subject to forfeiture if
    the holder&#146;s employment terminates. The holder of the RSU
    award does not have any of the benefits of ownership of the
    shares of Common Stock subject to the award, such as the right
    to vote the shares or to receive dividends, unless and until the
    RSU vests and the shares are issued.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (5) </TD>
    <TD></TD>
    <TD valign="bottom">
    Represents the aggregate value on date of grant for two RSU
    awards. One award was made on August&#160;1, 2005 with respect
    to 25,000&#160;shares of Common Stock and the other award was
    made on September&#160;30, 2005 with respect to 7,000; both
    based on the closing market price of Common Stock on their grant
    date. These RSU awards were the only RSUs held by the holder as
    of September&#160;30, 2005. The August&#160;1, 2005 RSU award
    vests at the rate of 12.5% upon completion of each quarter of
    continuous employment of the holder following the date of grant
    until such RSU is fully vested on August&#160;1, 2007. The
    September&#160;30, 2005 RSU award vests 12.5% on October&#160;1,
    2006 with the remainder vesting at the rate of 12.5% upon
    completion of each quarter of continuous employment of the
    holder following October&#160;1, 2006 until such RSU is fully
    vested on July&#160;1, 2008. As of September&#160;30, 2006,
    12,500 of the August&#160;1, 2005 RSUs had vested and none of
    the September&#160;30, 2005 RSUs had vested. The unvested
    portion of each RSU award is subject to forfeiture if the
    holder&#146;s employment terminates. The holder of the RSU award
    does not have any of the benefits of ownership of the shares of
    Common Stock subject to the award, such as the right to vote the
    shares or to receive dividends, unless and until the RSU vests
    and the shares are issued.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (6) </TD>
    <TD></TD>
    <TD valign="bottom">
    Mr.&#160;Triebes joined us in August 2004. The amounts shown in
    the &#147;All Other Compensation&#148; column include relocation
    expenses of $96,890 paid to Mr.&#160;Triebes in fiscal 2005.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (7) </TD>
    <TD></TD>
    <TD valign="bottom">
    Includes a $100,000 signing bonus.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Aggregate
    Exercise of Stock Options in Fiscal Year 2006 and Fiscal
    Year-End Option Values</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth information concerning the
    exercise of stock options during fiscal year 2006 by each of the
    Named Executive Officers and the number and value of unexercised
    options held by those officers at the end of fiscal year 2006:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="28%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=07 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=07 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=07 type=hang1 -->
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Number of Securities<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Value of Unexercised<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Underlying Unexercised<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B><FONT style="white-space: nowrap">In-the-Money</FONT><BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Options at<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Options at<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Shares<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Value<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>September&#160;30, 2006 (#)(1)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>September&#160;30, 2006 ($)(2)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Acquired on<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Realized<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Exercisable<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Unexercisable<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Exercisable<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Unexercisable<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Exercise (#)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)(3)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(#)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(#)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">John McAdam
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    245,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    9,360,550
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">Tom Hull
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    95,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,062,850
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    54,062
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    60,938
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,623,482
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,829,968
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">Edward Eames
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13,750
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    515,350
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">Dan Matte
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    32,313
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,165,544
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">Karl Triebes
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    81,250
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,700,875
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    25,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    143,750
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    772,750
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,443,313
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%; align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=60 -->

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="1%"></TD>
    <TD width="95%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    No new stock options were granted to the Named Executive
    Officers during fiscal year 2006.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    Based on a market value of $53.72&#160;per share, the closing
    price of Common Stock on September&#160;29, 2006 (as reported by
    the Nasdaq Global Market), less the exercise price, multiplied
    by the number of shares underlying the option.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    Based on a per share market value equal to the closing price of
    shares of Common Stock on the exercise date (as reported by the
    Nasdaq Global Market), less the exercise price, multiplied by
    the number of shares acquired upon exercise.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    13
</DIV><!-- END LOGICAL PAGE -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Employment
    Contracts and
    <FONT style="white-space: nowrap">Change-in-Control</FONT>
    Arrangements</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Under the terms of our stock incentive plans, equity awards are
    generally subject to special provisions upon the occurrence of a
    defined &#147;change in control&#148; transaction. Under the
    plans, subject to certain exceptions set forth therein, all or a
    certain portion of outstanding unvested stock options
    <FONT style="white-space: nowrap">and/or</FONT>
    unvested RSUs held by all participants under the plans,
    including our executive officers, will become fully vested upon
    a change in control of the Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Messrs.&#160;McAdam, Hull, Eames, Matte and Triebes have
    unvested RSUs under our 2005 Equity Incentive Plan. The grant
    agreement for these RSUs provides that upon certain changes in
    control of the Company, all of these outstanding and unvested
    RSUs will accelerate and fully vest.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Messrs.&#160;Hull and Triebes have unvested stock options under
    a non-qualified stock option plan, which provides that upon
    certain changes in control of the Company, all outstanding and
    unvested options under the plan will accelerate and fully vest.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Other than our stock incentive plans, there are no written
    employment contracts with any of the Named Executive Officers.
    Each such officer is an &#147;at-will&#148; employee, and his
    employment may be terminated anytime with or without cause.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Compensation
    Committee Interlocks and Insider Participation</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Compensation Committee during fiscal year 2006 was comprised
    of Messrs.&#160;Ames, Grinstein and Guelich. Each member of the
    Compensation Committee is independent under the rules of the
    Nasdaq Stock Market and the SEC. None of the Company&#146;s
    executive officers served as a member of the Board of Directors
    or Compensation Committee of any entity that has had one or more
    executive officers which served as a member of the
    Company&#146;s Board of Directors or Compensation Committee.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Report of
    Compensation Committee</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Compensation Committee (the &#147;Committee&#148;) is
    comprised of three independent, non-employee members of the
    Board of Directors, as defined by the Nasdaq Marketplace Rules.
    The Committee has overall responsibility for approving and
    evaluating the executive officer and director compensation
    plans, policies and programs of the Company. The objectives of
    the Committee are to correlate executive compensation with the
    Company&#146;s business objectives and performance and the
    creation of shareholder value, and to enable the Company to
    attract, retain and reward executive officers who contribute to
    its long-term success. The Committee reports frequently to the
    Board of Directors and maintains regular communications with the
    Company&#146;s President and CEO. The Committee conducts an
    annual review to determine whether the Company&#146;s executive
    compensation program is meeting the goals and objectives set by
    the Board of Directors and retains the services of outside
    professional consultants to assist it in this review.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Compensation
    Philosophy</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company&#146;s philosophy concerning compensation for
    executive officers is to directly link their compensation to
    continuous improvements in the Company&#146;s financial
    performance and the creation of shareholder value. The key
    elements of this philosophy are as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provide a competitive total compensation package that enables
    the Company to attract, motivate, reward and retain executive
    officers who contribute to the Company&#146;s success;
</TD>
</TR>

<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provide incentive compensation that is directly linked to the
    performance of the Company and aligns the interests of executive
    officers with the long-term interests of shareholders;&#160;and
</TD>
</TR>

<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    establish incentives that relate to the Company&#146;s annual
    and long-term business strategies and objectives.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Committee believes that the Company&#146;s executive
    compensation should reflect each executive officer&#146;s
    qualifications, experience, role and personal performance and
    the Company&#146;s performance
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    14
</DIV><!-- END LOGICAL PAGE -->
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<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    achievements. Consistent with this philosophy, the compensation
    package offered to executive officers includes base salary, cash
    incentive compensation in the form of bonuses, and long-term
    equity incentives in the form of stock options and RSUs.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Board of Directors has approved and adopted a &#147;Policy
    Regarding the Granting of Equity-Based Compensation
    Awards,&#148; a copy of which may be found under the
    &#147;investor relations&#148; section of our website,
    www.f5.com.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Executive
    Officer Compensation</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The three primary components of executive compensation are;
    (i)&#160;base salary, (ii)&#160;incentive compensation in the
    form of cash bonuses, and (iii)&#160;equity compensation. The
    Committee&#146;s function is to annually assess the performance
    of, and recommend to the full Board of Directors base salary and
    incentive compensation for, the Company&#146;s President and
    CEO. The Company&#146;s President and CEO recommends to the
    Committee annual base salary and incentive compensation
    adjustments for the other executive officers.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In evaluating executive officer compensation for fiscal year
    2006 and setting the cash and equity compensation targets for
    Mr.&#160;McAdam and the other executive officers for fiscal year
    2007, the Committee reviewed compensation data prepared by an
    outside compensation consultant that compared the Company&#146;s
    executive compensation with similar data from (i)&#160;a peer
    group of 31&#160;companies developed by the outside consultant
    and approved by the Committee and (ii)&#160;companies in the
    software/networks sector with revenues from $200&#160;million to
    $1&#160;billion that participated in a national executive survey.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Base Salary.</I>&#160;&#160;Executive officers&#146; base
    salaries are set at levels which reflect their specific job
    responsibilities, experience, qualifications, job performance,
    potential contributions, market data from salary surveys
    covering technology companies in the Seattle, Washington area
    and other comparable areas, and compensation data provided by
    the outside consultant. Base salaries are reviewed annually, and
    adjusted from time to time in recognition of individual
    performance, promotions and marketplace competitiveness. At its
    meeting on November&#160;17, 2006, the Committee approved the
    following fiscal year 2007 base salaries for the Named Executive
    Officers identified in the Summary Executive Compensation Table
    above: Tom Hull, $292,136; Edward Eames, $283,628; Dan Matte,
    $209,632; and Karl Triebes, $342,698.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Incentive Compensation.</I>&#160;&#160;To reinforce the
    attainment of Company goals, the Committee believes that a
    portion of the annual compensation of the executive officers
    should be incentive compensation in the form of a cash bonus.
    The Committee believes that incentives based on attaining or
    exceeding established financial targets, properly aligns the
    interests of the executive officers with the interests of the
    shareholders. Bonuses for the executive officers are awarded
    quarterly and are 50% based on the Company achieving target
    revenue for such periods and 50% based on the Company achieving
    target EBITDA for such periods. Each such target is determined
    by the Board of Directors and is set forth in the Board-approved
    budget for each such fiscal year. The executive officers may
    earn additional bonuses for over-achievement of these
    targets<B>.</B> The target cash bonus for each executive officer
    constitutes a percentage of each officer&#146;s base salary,
    ranging from 30% to 60%. The Committee believes that the cash
    bonuses paid to the executive officers for performance in 2006
    were merited based on the Company&#146;s outstanding operating
    results, which included increases in total revenue and net
    income over fiscal year 2005 of 40&#160;percent and
    41&#160;percent respectively, and significant growth in market
    share.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Equity Compensation.</I>&#160;&#160;The Committee believes
    that equity ownership aligns the interests of executive officers
    with those of the shareholders and provides significant
    motivation to executive officers to maximize value for the
    Company&#146;s shareholders. In accordance with this belief, the
    Committee periodically approves grants of equity compensation
    under the Company&#146;s equity incentive plans. The Committee
    reviews and approves recommendations made by the CEO on grants
    of equity compensation for other executive officers. These
    recommendations are based on the relative position and
    responsibilities of each executive officer, previous and
    expected contributions of each officer to the Company&#146;s
    success, previous grants to such officer, and recruitment and
    retention considerations.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    15
</DIV><!-- END LOGICAL PAGE -->
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Committee approved a grant of RSUs to each executive officer
    (the grant to Mr.&#160;McAdam is discussed below) effective
    August&#160;1, 2005. These RSUs vest at the rate of 12.5% upon
    completion of each quarter of continuous employment at the
    Company by the executive officer, and will be fully vested on
    August&#160;1, 2007. The executive officers, including
    Mr.&#160;McAdam, did not receive grants of equity compensation
    in fiscal year 2006.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At its meeting on December&#160;12, 2006, the Committee approved
    a performance-based equity compensation program for fiscal year
    2007 (the &#147;2007 Performance Grant Program&#148;) and grants
    of 22,000 RSUs to each of the Named Executive Officers. These
    equity grants were effective as of December&#160;15, 2006 and
    were made pursuant to the Company&#146;s 2005 Equity Incentive
    Plan. Fifty percent (50%) of the aggregate number of RSUs in
    each such grant vests in equal quarterly increments over two
    years, until such portion of the grant is fully vested on
    November&#160;1, 2008. The vesting of twenty-five percent (25%)
    of each such grant is subject to the Company achieving specified
    percentage increases in total revenue for fiscal year 2007,
    relative to fiscal year 2006. The vesting of the remaining
    twenty-five percent (25%) is subject to the Company meeting
    specified performance criteria to be set by the Compensation
    Committee for fiscal year 2008. In accordance with the 2005
    Equity Incentive Plan, a Named Executive Officer must be
    employed by the Company or its affiliates on each vesting date
    in order to receive the shares of common stock issuable upon
    such vesting date.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Other Benefits and Perquisites.</I>&#160;&#160;Executive
    officers may receive additional benefits and limited perquisites
    that are similar to those offered to Company employees
    generally. The Company provides medical, dental and group life
    insurance benefits to each executive officer, similar to those
    provided to all other Company employees. Also, as provided to
    all other Company employees, the Company matches a portion of
    each executive&#146;s contribution to his or her account in the
    Company 401(k) retirement plan. The Company does not provide or
    reimburse its CEO or other executive officers for any other
    perquisites of a personal nature.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Employee Stock Purchase Plan.</I>&#160;&#160;All qualifying
    employees, including executive officers, can participate in the
    Company&#146;s Employee Stock Purchase Plan. Under this plan,
    employees can acquire shares of common stock of the Company
    through regular payroll deductions of up to 15% of gross
    earnings, subject to the limitation that not more than $25,000
    in value of stock may be purchased annually. The purchase price
    of the shares is the lower of (i)&#160;85% of the market price
    at the commencement each offering period, or (ii)&#160;85% of
    the market price as of the date of purchase.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Chief
    Executive Officer Compensation</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In setting Mr.&#160;McAdam&#146;s base salary and incentive
    compensation for fiscal year 2006, the Committee considered
    compensation levels for similar positions at public companies of
    similar size and revenue levels, in similar industries, and with
    similar technological and marketing challenges, operational
    complexities and long-term performance and growth objectives.
    The Committee reviewed salary surveys, publicly available
    information on compensation levels and other data provided by
    the outside consultant in performing this analysis.
    Mr.&#160;McAdam&#146;s base salary was increased by 6% for
    fiscal 2006 over his base salary for fiscal year 2005.
    Mr.&#160;McAdam&#146;s received a cash bonus totaling $389,104
    in fiscal year 2006. The Committee believes that the cash bonus
    paid to Mr.&#160;McAdam for performance in 2006 was merited
    based on the Company&#146;s outstanding operating results, which
    included increases in total revenue and net income over fiscal
    year 2005 of 40&#160;percent and 41&#160;percent respectively,
    and significant growth in market share.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Upon joining the Company, Mr.&#160;McAdam was given stock
    options in an amount comparable to those given to other
    non-founder executives hired to perform similar functions in
    comparable companies. This initial option grant was subsequently
    cancelled at his request. Mr.&#160;McAdam has been awarded
    several additional grants of equity compensation in amounts
    considered by the Committee to be appropriate in light of
    Mr.&#160;McAdam&#146;s performance as the Company&#146;s
    President and CEO and the Company&#146;s outstanding operating
    results, including an award of 50,000 RSUs issued on
    August&#160;1, 2005 under the 2005 Equity Incentive Plan. This
    award was based on an analysis of comparable companies similar
    to that used to determine Mr.&#160;McAdam&#146;s base salary. In
    addition, in making its recommendation to the Board of
    Directors, the Committee considered the total number of the
    Company&#146;s outstanding shares, the number of shares of
    Common Stock available for issuance under the Company&#146;s
    equity compensation plans, including under the 2005 Equity
    Incentive Plan, and
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    16
</DIV><!-- END LOGICAL PAGE -->
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<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    the unique retention value inherent in equity compensation as
    compared to other forms of compensation. The RSU grant vests at
    the rate of 12.5% upon completion of each quarter of continuous
    employment at the Company by Mr.&#160;McAdam, and will be fully
    vested on August&#160;1, 2007.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At its meeting on December&#160;12, 2006, the Board of Directors
    approved the Committee&#146;s recommendation that
    (i)&#160;Mr.&#160;McAdam&#146;s fiscal year 2007 base salary
    remain at the same level as his fiscal year 2006 base salary;
    (ii)&#160;he be eligible for an incentive compensation award in
    the form of a cash bonus equal to 80% of his base salary, and
    (iii)&#160;he receive a grant of 100,000 RSUs pursuant to the
    2007 Performance Grant Program.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Tax
    Deductibility of Executive Compensation under &#167;162(m) of
    the Internal Revenue Code</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Under Section&#160;162(m) of the Internal Revenue Code, the
    federal income tax deduction for certain types of compensation
    paid to the chief executive officer and four other most highly
    compensated executive officers of publicly held companies is
    limited to $1&#160;million per officer per fiscal year unless
    such compensation meets certain requirements. The Committee is
    aware of this limitation and has decided that it is not
    appropriate at this time to limit the Company&#146;s discretion
    to design the compensation packages payable to the
    Company&#146;s executive officers to comply with these
    deductibility guidelines.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Compensation Committee
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Keith D. Grinstein, Chair<BR>
    A. Gary Ames<BR>
    Karl D. Guelich
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Code of
    Ethics for Senior Financial Officers</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have adopted a Code of Ethics that applies to all of our
    senior financial officers, including our CEO, chief finance
    officer and chief accounting officer. The Code of Ethics is
    posted on the Company&#146;s website. The Internet address for
    our website is <U>www.f5.com</U> and the Code of Ethics may be
    found under the &#147;investor relations&#148; section of our
    website. A copy of the Code of Ethics may be obtained without
    charge by written request to the Company&#146;s Secretary. We
    also have a separate Code of Ethics that applies to all of the
    Company&#146;s employees, which may be also found under the
    &#147;investor relations&#148; section of our website.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Report of
    the Audit Committee</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Audit Committee consists of three directors, each of whom,
    in the judgment of the Board, is an &#147;independent
    director&#148; as defined in the listing standards for The
    Nasdaq Stock Market. The Audit Committee acts pursuant to a
    written charter that has been adopted by the Board of Directors.
    The Audit Committee charter is attached to this Proxy Statement
    as Appendix A and is available on the &#147;investor
    relations&#148; section of the Company&#146;s website,
    www.f5.com.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On behalf of the Board of Directors, the Audit Committee
    oversees the Company&#146;s financial reporting process and its
    internal controls over financial reporting, areas for which
    management has the primary responsibility.
    PricewaterhouseCoopers, LLP, the independent registered public
    accounting firm (the &#147;Auditors&#148;), is responsible for
    expressing an opinion as to the conformity of the audited
    financial statements with accounting principles generally
    accepted in the United States of America and for issuing its
    opinions on management&#146;s assessment and on the
    effectiveness of the Company&#146;s internal control over
    financial reporting.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In fulfilling its oversight responsibilities, the Audit
    Committee has reviewed and discussed with management and the
    Auditors the audited financial statements and the quarterly
    unaudited financial statements of the Company for the fiscal
    year ended September&#160;30, 2006, matters relating to the
    Company&#146;s internal controls over financial reporting and
    the processes that support certifications of the financial
    statements by the Company&#146;s Chief Executive Officer and
    Chief Accounting Officer.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Audit Committee discussed with the Auditors the overall
    scope and plans for the annual audit. The Audit Committee meets
    with the Auditors, with and without management present, to
    discuss the results of
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    17
</DIV><!-- END LOGICAL PAGE -->
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    their examinations, their consideration of the Company&#146;s
    internal controls in connection with their audit, and the
    overall quality of the Company&#146;s financial reporting.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Audit Committee reviewed with the Auditors their judgments
    as to the quality and acceptability of the Company&#146;s
    accounting principles and such other matters as are required to
    be discussed with the Audit Committee under generally accepted
    auditing standards. The Audit Committee has discussed and
    reviewed with the Auditors all matters required to be discussed
    under the Statement on Auditing Standards No.&#160;61
    <I>Communication with Audit Committees.</I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Audit Committee has received from the Auditors a formal
    written statement describing all relationships between them and
    the Company that might bear on their independence consistent
    with Independence Standards Board Standard No.&#160;1
    (Independence Discussions with Audit Committees), discussed with
    them any relationships that may impact their objectivity and
    independence, including the amount and significance of non-audit
    services provided by them, and has satisfied itself as to their
    independence.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Based on the reviews and discussions referred to above, the
    Audit Committee recommended to the Board of Directors (and the
    Board has approved) that the audited financial statements be
    included in the Annual Report on
    <FONT style="white-space: nowrap">Form&#160;10-K</FONT>
    for the year ended September&#160;30, 2006 for filing with the
    Securities and Exchange Commission. The Audit Committee has also
    selected PricewaterhouseCoopers, LLP as the Company&#146;s
    independent registered public accounting firm for the fiscal
    year ending September&#160;30, 2007. The Board is recommending
    that shareholders ratify this selection at the Annual Meeting.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Audit Committee
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Karl Guelich, Chair<BR>
    Alan J. Higginson<BR>
    Keith D. Grinstein
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Fees Paid
    to PricewaterhouseCoopers LLP</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following is a summary of the fees billed to the Company by
    PricewaterhouseCoopers LLP for professional services rendered
    for the fiscal years ended September&#160;30, 2006 and 2005:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="77%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Years Ended September&#160;30,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Fee Category</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2006</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2005</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">Audit Fees
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    911,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    917,536
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">Audit-Related Fees
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    416,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    14,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">Tax Fees
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11,800
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    34,232
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">All Other Fees
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B><FONT style="font-size: 10pt">Total Fees</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,207,900
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    965,768
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Audit Fees.</I>&#160;&#160;Consists of fees billed for
    professional services rendered for the audit of the
    Company&#146;s consolidated financial statements and review of
    the interim consolidated financial statements included in
    quarterly reports and services that are normally provided by
    PricewaterhouseCoopers LLP in connection with statutory and
    regulatory filings or engagements including consultations
    related to compliance with the Sarbanes-Oxley Act of 2002.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Audit-Related Fees.</I>&#160;&#160;Consists of fees billed
    for assurance and related services that are reasonably related
    to the performance of the audit or review of the Company&#146;s
    consolidated financial statements and are not reported under
    &#147;Audit Fees.&#148; These services include accounting
    consultations in connection with acquisitions, financial
    accounting and reporting standards and services related to
    registration statements and public offerings. Substantially all
    of the Audit-Related Fees in fiscal 2006 were for services in
    connection with the restatement resulting from the
    Company&#146;s review of its stock option practices and
    historical financial statements.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    18
</DIV><!-- END LOGICAL PAGE -->
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Tax Fees.</I>&#160;&#160;Consists of fees billed for
    professional services for tax compliance, tax advice and tax
    planning. These services include assistance regarding federal,
    state and international tax compliance, tax audit defense,
    customs and duties, mergers and acquisitions, and international
    tax planning.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Audit
    Committee Pre-Approval Procedures</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Audit Committee meets with our independent registered public
    accounting firm to approve the annual scope of accounting
    services to be performed and the related fee estimates. The
    Audit Committee also meets with our independent registered
    public accounting firm, on a quarterly basis, following
    completion of their quarterly reviews and annual audit and prior
    to our earnings announcements, to review the results of their
    work. During the course of the year, the Chairman of the Audit
    Committee has the authority to pre-approve requests for services
    that were not approved in the annual pre-approval process. The
    Chairman of the Audit Committee reports any interim
    pre-approvals at the following quarterly meeting. At each of the
    meetings, management and our independent registered public
    accounting firm update the Audit Committee with material changes
    to any service engagement and related fee estimates as compared
    to amounts previously approved. During fiscal 2006, all audit
    and non-audit services performed by PricewaterhouseCoopers LLP
    for the Company were pre-approved by the Audit Committee in
    accordance with the foregoing procedures.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Annual
    Independence Determination</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Audit Committee considered whether the provision of nonaudit
    services is compatible with the principal accountants&#146;
    independence and concluded that the provision of nonaudit
    services has been compatible with maintaining the independence
    of the Company&#146;s external auditors.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    19
</DIV><!-- END LOGICAL PAGE -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Stock
    Price Performance</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The information regarding stock price performance contained in
    this section shall not be deemed to be &#147;soliciting
    material&#148; or to be &#147;filed&#148; with the Securities
    and Exchange Commission, nor shall such information be
    incorporated by reference into any future filings under the
    Securities Act of 1933, as amended, or the Securities Exchange
    Act of 1934, as amended, except to the extent that the Company
    specifically incorporates it by reference in such filing.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The graph below compares the annual percentage change in the
    cumulative total return on shares of Common Stock for F5
    Networks, Inc., the Nasdaq Composite Index and the Nasdaq
    Computer Index for the period commencing September&#160;28,
    2001, and ending September&#160;29, 2006.
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Comparison
    of Cumulative Total Return *<BR>
    Among F5 Networks, Inc.,<BR>
    Nasdaq Composite and Nasdaq Computer Index</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <IMG src="v26639dev2663902.gif" alt="(F5 NETWORKS INC LINE GRAPH)" >
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="46%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutterleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutterright -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutterleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutterright -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=04 type=gutterleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=04 type=gutterright -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=05 type=gutterleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=05 type=gutterright -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=06 type=gutterleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=06 type=gutterright -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=07 type=gutterleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=07 type=gutterright -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=07 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=07 type=hang1 -->
</TR>
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom" style="border-left: 1px solid #000000; padding-left: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-top: 1px solid #000000">
    <B>9/28/01</B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-top: 1px solid #000000">
    <B>9/30/02</B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-top: 1px solid #000000">
    <B>9/30/03</B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-top: 1px solid #000000">
    <B>9/30/04</B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-top: 1px solid #000000">
    <B>9/30/05</B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
    <B>9/29/06</B>
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top" style="border-left: 1px solid #000000; padding-left: 2pt; border-top: 1px solid #000000">
<DIV style="text-indent: 5pt; margin-left: 0pt">
    <FONT style="font-size: 10pt">F5 Networks, Inc.&#160;
    </FONT>
</DIV>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    100
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    81
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    207
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    328
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    468
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    579
</TD>
<TD nowrap align="left" valign="bottom" style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top" style="border-left: 1px solid #000000; padding-left: 2pt; border-top: 1px solid #000000">
<DIV style="text-indent: 5pt; margin-left: 0pt">
    <FONT style="font-size: 10pt">Nasdaq Composite Index
    </FONT>
</DIV>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    100
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    78
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    119
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    127
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    144
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    151
</TD>
<TD nowrap align="left" valign="bottom" style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top" style="border-left: 1px solid #000000; padding-left: 2pt; border-top: 1px solid #000000">
<DIV style="text-indent: 5pt; margin-left: 0pt">
    <FONT style="font-size: 10pt">Nasdaq Computer Index
    </FONT>
</DIV>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    100
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    77
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    124
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    123
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    141
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    147
</TD>
<TD nowrap align="left" valign="bottom" style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="1%"></TD>
    <TD width="1%"></TD>
    <TD width="98%"></TD>
</TR>

<TR>
    <TD valign="top">
    * </TD>
    <TD></TD>
    <TD valign="bottom">
    Assumes that $100 was invested September&#160;28, 2001 in shares
    of Common Stock and in each index, and that all dividends were
    reinvested. Shareholder returns over the indicated period should
    not be considered indicative of future shareholder returns.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    20
</DIV><!-- END LOGICAL PAGE -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->


<!-- link1 "PROPOSAL 1: ELECTION OF THREE CLASS II DIRECTORS" -->
<DIV align="left"><A NAME="003"></A></DIV>


<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">PROPOSAL&#160;1:&#160;&#160;ELECTION
    OF THREE CLASS&#160;II DIRECTORS</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At the Annual Meeting, the shareholders will vote on the
    election of three Class&#160;II directors to serve for
    three-year terms until the annual meeting of shareholders for
    fiscal year end 2009 and until their successors are elected and
    qualified. The Board of Directors has unanimously nominated
    Deborah L. Bevier, Alan J. Higginson and John McAdam for
    reelection to the Board of Directors as Class&#160;II directors.
    The nominees have indicated that they are willing and able to
    serve as directors. If either nominee becomes unable or
    unwilling to serve, the accompanying proxy may be voted for the
    election of such other person as shall be designated by the
    Board of Directors. The proxies being solicited will be voted
    for no more than three nominees for Class&#160;II directors at
    the Annual Meeting. The directors will be elected by a plurality
    of the votes cast, in person or by proxy, at the Annual Meeting,
    assuming a quorum is present. Shareholders do not have
    cumulative voting rights in the election of directors.
</DIV>


<!-- link1 "THE BOARD OF DIRECTORS RECOMMENDS A VOTE &#147;FOR&#148; THE ELECTION OF THE THREE NOMINEES." -->
<DIV align="left"><A NAME="004"></A></DIV>


<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">THE BOARD
    OF DIRECTORS RECOMMENDS A VOTE &#147;FOR&#148;<BR>
    THE ELECTION OF THE THREE NOMINEES.</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Unless otherwise instructed, it is the intention of the persons
    named in the accompanying proxy card to vote shares represented
    by properly executed proxy cards for the election of
    Ms.&#160;Bevier and Messrs.&#160;Higginson and McAdam.
</DIV>


<!-- link1 "PROPOSAL 2: AMENDMENT TO THE 2005 EQUITY INCENTIVE PLAN" -->
<DIV align="left"><A NAME="005"></A></DIV>


<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">PROPOSAL&#160;2:&#160;&#160;AMENDMENT
    TO THE 2005 EQUITY INCENTIVE PLAN</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At the Annual Meeting, the shareholders of the Company will be
    asked to approve an amendment to the 2005 Plan which, if
    approved, will increase the number of shares of Common Stock
    available for purchase under the 2005 Plan by
    2,000,000&#160;shares, to an aggregate of 3,700,000&#160;shares.
    No other amendments to the 2005 Plan are being proposed. This
    amendment to the 2005 Plan was approved by the Board on
    January&#160;8, 2007 and will become effective upon receipt of
    the shareholders&#146; approval at the Annual Meeting. The
    affirmative vote of the holders of a majority of the outstanding
    shares of Common Stock of the Company represented and voting on
    the proposal at the Annual Meeting is required to adopt the
    amendment to the 2005 Plan.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Board of Directors believes that the 2005 Plan has
    contributed to strengthening the incentive of participating
    employees to achieve the objectives of the Company and its
    shareholders by encouraging employees to acquire a greater
    proprietary interest in the Company. As of January&#160;16,
    2007, only 240,996&#160;shares remained available for the future
    grant of equity awards under the 2005 Plan. The Board of
    Directors believes that additional shares must be reserved for
    use under the 2005 Plan to enable the Company to attract and
    retain key employees through the granting of options and stock
    units under the 2005 Plan. The proposed increase in the number
    of shares under the 2005 Plan is not required or intended to
    cover awards previously made under the 2005 Plan. As such, no
    new plan benefits have been granted to date, and future awards
    under the 2005 Plan are not yet determinable. In the event that
    the required votes to approve the amendment to the 2005 Plan are
    not obtained, the amendment to the 2005 Plan will not become
    effective and the Company will continue to make grants of awards
    pursuant to the terms of the 2005 Plan as currently in effect
    and subject to applicable law.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Summary
    of the 2005 Equity Incentive Plan</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    A copy of the 2005 Plan, as amended, is attached to this Proxy
    Statement as Appendix&#160;B and is incorporated herein by
    reference. The following description of the 2005 Plan is a
    summary and does not purport to be a complete description. See
    Appendix&#160;B for more detailed information.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>General.</I>&#160;&#160;The 2005 Plan provides for grants of
    nonstatutory stock options (&#147;NSOs&#148;), which are options
    that do not qualify as incentive stock options under
    Section&#160;422 of the Code, and stock units (collectively,
    &#147;Stock Awards&#148;) to employees, including officers, or
    directors of and consultants to the Company or any affiliate of
    the Company. As of January&#160;16, 2007, approximately 1,159
    employees and 6 non-employee directors are eligible to
    participate in the 2005 Plan. As of January&#160;16, 2007, a
    total of 582,132&#160;shares had
</DIV>

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    <BR>
    21
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    been issued upon the vesting
    <FONT style="white-space: nowrap">and/or</FONT>
    exercise of previously granted Stock Awards, options to purchase
    37,500&#160;shares remained outstanding and 240,996&#160;shares
    remained available for the future grant of Stock Awards. Shares
    subject to Stock Awards that have lapsed or terminated, without
    having been exercised in full, may again become available for
    the grant of awards under the 2005 Plan.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Board of Directors or a committee appointed by the Board of
    Directors (in either case, the &#147;Administrator&#148;)
    administers the 2005 Plan. The Administrator has broad
    discretionary authority to determine which recipients and what
    types of awards are to be granted, including the exercise price,
    if any, applicable to awards, the number of shares subject to
    awards, the vesting
    <FONT style="white-space: nowrap">and/or</FONT>
    exercisability of awards and any other terms and conditions
    (including forfeiture conditions) that apply to awards. Any
    award may be granted either alone or in tandem with other awards.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Board of Directors may amend the 2005 Plan; provided that no
    amendment will be effective unless approved by the shareholders
    of the Company if shareholder approval is necessary to satisfy
    applicable laws or stock exchange listing requirements. In
    addition, shareholder approval is required if the exercise price
    of any outstanding option is to be reduced (other than as a
    result of certain adjustments to outstanding awards to reflect
    corporate capital transactions, such as stock splits and other
    reorganizations). The 2005 Plan will terminate on
    December&#160;30, 2014, unless terminated sooner by the Board of
    Directors.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If any change is made to the Common Stock without receipt of
    consideration by the Company (through merger, reorganization,
    stock split, stock dividend, combination of shares or similar
    change to the capital structure), the 2005 Plan and each
    outstanding Stock Award will be appropriately adjusted in
    (1)&#160;the number and kind of shares subject to the 2005 Plan,
    (2)&#160;the share limitations set forth in the 2005 Plan
    (including the limit of 1,000,000&#160;shares that may be
    granted to any employee in any fiscal year), (3)&#160;the number
    and kind of shares covered by each outstanding Stock Award and
    (4)&#160;the exercise or purchase price per share subject to
    each outstanding Stock Award.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Section&#160;162(m)
    Limitations.</I>&#160;&#160;Section&#160;162(m) of the Code
    generally disallows a tax deduction to public companies for
    compensation in excess of $1&#160;million paid during any single
    year to the Company&#146;s Chief Executive Officer or any of the
    four other most highly compensated officers. Certain
    &#147;performance-based&#148; compensation is specifically
    exempt from this deduction limit if it meets the requirements
    specified in Section&#160;162(m) and the regulations thereunder.
    One of the requirements for equity compensation awards, such as
    stock options, to qualify as performance-based compensation is
    that the shareholder-approved plan under which the awards are
    granted must include a limit on the number of shares granted to
    any one employee under the plan. Accordingly, the 2005 Plan
    provides that no employee may be granted awards covering more
    than 1,000,000&#160;shares in any fiscal year. The Company
    believes that stock options granted under the 2005 Plan can
    qualify as performance-based compensation so that compensation
    amounts arising in connection with such options may not be
    subject to the loss deduction rule of Section&#160;162(m). Stock
    units will generally not qualify as performance-based
    compensation so that compensation amounts arising in connection
    with such stock units may be subject to this loss deduction rule.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Options.</I>&#160;&#160;Options granted under the 2005 Plan
    are NSOs. The term of options granted under the 2005 Plan may
    not exceed 10&#160;years. The per share exercise price of all
    options must be at least equal to the fair market value of a
    share of Common Stock on the date the option is granted. The
    closing price of the Common Stock as reported on the Nasdaq
    Global Market on January&#160;16, 2007 was $79.06&#160;per
    share. The 2005 Plan permits payment of an exercise price to be
    made by cash, check, wire transfer, other shares of Company
    Common Stock (with some restrictions), broker assisted
    <FONT style="white-space: nowrap">same-day</FONT>
    sales, any other form of consideration permitted by applicable
    law and acceptable to the Board of Directors or any combination
    thereof. Options granted under the 2005 Plan vest at the rate
    specified in the option agreement. The Company&#146;s standard
    vesting schedule is over four years for grants to newly-hired
    employees.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    An optionee may not transfer options other than by will or the
    laws of descent or distribution, provided that an optionee may
    designate a beneficiary who may exercise the option following
    the optionee&#146;s death. An optionee whose relationship with
    the Company or any related corporation ceases for any reason,
    except by death or permanent and total disability, generally may
    exercise vested options up to three months following cessation.
    Vested options may generally be exercised for up to
    12&#160;months after an optionee&#146;s relationship with
</DIV>

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    <BR>
    22
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    the Company or any affiliate of the Company ceases due to
    disability and for generally up to 18&#160;months after the
    relationship with the Company or any affiliate of the Company
    ceases due to death. However, options may terminate or expire
    sooner or later as may be determined by the Board of Directors
    and set forth in the option agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Stock Units.</I>&#160;&#160;Each stock unit agreement will
    contain provisions regarding (1)&#160;the number of shares
    subject to such Stock Award, (2)&#160;the purchase price of the
    shares, if any, and the means of payment for the shares,
    (3)&#160;the performance or other criteria, if any, that will
    determine the number of shares vested, (4)&#160;such terms and
    conditions on the grant, issuance, vesting and forfeiture of the
    shares, as applicable, as may be determined from time to time by
    the Board of Directors or other administrator of the 2005 Plan,
    (5)&#160;restrictions on the transferability of the Stock Award,
    and (6)&#160;such further terms and conditions, in each case not
    inconsistent with the 2005 Plan, as may be determined from time
    to time by the Board of Directors or other administrator of the
    2005 Plan. In the event that a participant&#146;s relationship
    with the Company terminates, the Company may reacquire any or
    all of the shares of Common Stock held by the participant which
    have not vested or which are otherwise subject to forfeiture
    conditions. Stock units may be awarded in consideration for past
    services. Rights under a stock unit agreement may not be
    transferred other than by will or by the laws of descent and
    distribution. On January&#160;23, 2007, the Board amended the
    repurchase provision in the 2005 Plan to clarify that the
    provision applies only to Stock Units and was subject to the
    Plan adjustment provisions for changes in capitalization and
    change in control of the Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Change of Control Provisions.</I>&#160;&#160;Subject to the
    provisions of any Stock Award Agreement, upon certain changes in
    control of the Company as provided under the 2005 Plan, the
    surviving entity will either assume or substitute all
    outstanding Stock Awards under the 2005 Plan. If the surviving
    entity determines not to assume or substitute these awards, then
    with respect to persons whose service with the Company or any
    affiliate of the Company has not terminated before the change in
    control, the vesting of 50% of these Stock Awards (and the time
    during which these awards may be exercised) will accelerate and
    the awards will terminate if not exercised before the change in
    control.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Options and Stock Units Granted to Certain
    Persons.</I>&#160;&#160;The aggregate numbers of shares of
    Common Stock subject to Stock Awards granted to certain persons
    under the 2005 Plan since its inception are as follows:
    (i)&#160;John McAdam, President and Chief Executive Officer and
    a nominee for election to the Board of Directors at the Annual
    Meeting, 150,000&#160;shares; (ii)&#160;Tom Hull, Senior VP of
    Worldwide Sales, 42,000&#160;shares; (iii)&#160;Edward Eames,
    Senior VP of Business Operations, 42,000&#160;shares;
    (iv)&#160;Dan Matte, Senior VP of Marketing, 54,000&#160;shares;
    (v)&#160;Karl Triebes, Senior VP of Product Development and
    Chief Technology Officer, 42,000&#160;shares; (vi)&#160;all
    current executive officers as a group, an aggregate of
    460,000&#160;shares; (vii)&#160;all current directors who are
    not executive officers as a group (except for Ms.&#160;Bevier
    and Mr.&#160;Higginson), an aggregate of 60,000&#160;shares;
    (viii)&#160;Ms.&#160;Bevier, a nominee for election to the Board
    of Directors at the Annual Meeting, 5,000&#160;shares;
    (ix)&#160;Mr.&#160;Higginson, a nominee for election to the
    Board of Directors at the Annual Meeting, 20,000&#160;shares;
    and (x)&#160;all employees, including current officers who are
    not executive officers, as a group, an aggregate of
    869,479&#160;shares. Since its inception, no options have been
    granted under the 2005 Plan to any associate of any such
    director, nominee or executive officer, and no other person has
    been granted five percent or more of the total amount of options
    granted under the 2005 Plan.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Certain
    Federal Income Tax Consequences</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    THE FOLLOWING SUMMARY OF FEDERAL INCOME TAX CONSEQUENCES IS
    BASED UPON EXISTING STATUTES, REGULATIONS AND INTERPRETATIONS
    THEREOF. THE APPLICABLE RULES&#160;ARE COMPLEX, AND INCOME TAX
    CONSEQUENCES MAY VARY DEPENDING UPON THE PARTICULAR
    CIRCUMSTANCES OF EACH PLAN PARTICIPANT. THIS PROXY STATEMENT
    DESCRIBES FEDERAL INCOME TAX CONSEQUENCES OF GENERAL
    APPLICABILITY, BUT DOES NOT PURPORT TO DESCRIBE PARTICULAR
    CONSEQUENCES TO EACH INDIVIDUAL PLAN PARTICIPANT, OR FOREIGN,
    STATE OR LOCAL INCOME TAX CONSEQUENCES, WHICH MAY DIFFER FROM
    THE UNITED STATES FEDERAL INCOME TAX CONSEQUENCES.
</DIV>

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    <BR>
    23
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Stock option grants under the 2005 Plan are intended to be NSOs.
    Generally, no federal income tax is payable by a participant
    upon the grant of a stock option and no deduction is taken by
    the Company at that time. Under current tax laws, if a
    participant exercises a NSO as to vested shares (meaning, shares
    that are not subject to a substantial risk of forfeiture as
    further described below), he or she will recognize compensation
    income equal to the difference between the fair market value of
    the Common Stock on the exercise date and the stock option
    exercise price. The Company will be entitled to a corresponding
    deduction on its income tax return. Options granted under the
    2005 Plan will generally not permit recipients to exercise the
    options as to unvested shares.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Stock units are also governed by Section&#160;83 of the Code.
    Generally, no taxes are due when an award is initially made, but
    the recipient will recognize taxable income when the shares
    subject thereto are no longer subject to a &#147;substantial
    risk of forfeiture&#148; (i.e. the shares subject thereto become
    vested or transferable, generally on the date the shares are
    issued to the recipient upon vesting). Income tax is paid on the
    value of the stock or units at ordinary rates when the
    restrictions lapse, and then at capital gain rates when the
    shares are sold. In certain cases, the participant may be
    eligible to make an election under Section&#160;83(b) of the
    Code, in which case the timing of the tax recognition event and
    the amount of income recognized will differ from that described
    above.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If an award under the 2005 Plan constitutes nonqualified
    deferred compensation that is subject to Section&#160;409A of
    the Code, certain requirements must be met (e.g., rules
    regarding deferral elections, distributions and acceleration of
    benefits). If the requirements are not satisfied, the
    participant may have to include an amount in income currently
    (or, if later, when no longer subject to a substantial risk of
    forfeiture), and may be subject to an additional tax equal to
    20% of the amount included in income plus interest from the date
    of deferral (at the IRS underpayment rate plus 1%). Incentive
    stock options are generally exempted from the requirements of
    Section&#160;409A of the Code and NSOs are generally exempted if
    certain requirements are satisfied (e.g., if the exercise price
    can never be less than the fair market value of the stock on the
    grant date).
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Section&#160;162(m)
    Limitations</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As discussed above, as a public company, the Company is subject
    to the tax-deduction rule of Section&#160;162(m) of the Code
    (applicable to compensation in excess of $1&#160;million paid to
    certain of the Company&#146;s executive officers during any
    year). The 2005 Plan includes a limitation on the number of
    shares that may be granted subject to awards made to an employee
    during any fiscal year to permit the Company to qualify stock
    options granted under the 2005 Plan as performance-based
    compensation, which is excepted from the general tax-deduction
    rule. The Section&#160;162(m) limit in the 2005 Plan is
    1,000,000&#160;shares per fiscal year. Stock options issued
    under the 2005 Plan will generally qualify as performance-based
    compensation, while stock units will generally not qualify as
    performance-based compensation, and so compensation amounts
    arising in connection with stock units may be subject to the
    Section&#160;162(m) tax deduction rule.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Section&#160;409A
    of the Code</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    To the extent that the payments or benefits provided under the
    2005 Plan are considered deferred compensation subject to
    Section&#160;409A of the Code, the Company intends for the 2005
    Plan to comply with the standards for nonqualified deferred
    compensation established by Section&#160;409A.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Accounting
    Treatment</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company is generally required to recognize compensation
    expense in an amount equal to the fair value on the grant date
    of all stock options. The fair value of an award will be based
    on the number of shares subject to the award that are expected
    to vest. The Company uses either Black-Scholes or a binomial
    valuation model to measure fair value of option grants. In
    addition, the Company is required to recognize compensation
    expense for Stock Awards as they vest, as adjusted for actual
    forfeitures that occur before vesting but not adjusted for any
    previously recognized compensation cost if an award lapses
    unexercised.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    24
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">THE BOARD
    RECOMMENDS A VOTE &#147;FOR&#148; APPROVAL OF THIS
    PROPOSAL.</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Unless otherwise instructed, it is the intention of the persons
    named in the accompanying proxy card to vote shares represented
    by properly executed proxy cards &#147;for&#148; this proposal.
</DIV>


<!-- link1 "PROPOSAL 3. RATIFICATION OF INDEPENDENT AUDITOR" -->
<DIV align="left"><A NAME="006"></A></DIV>


<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times; font-variant: SMALL-CAPS">PROPOSAL&#160;3.&#160;&#160;RATIFICATION
    OF INDEPENDENT AUDITOR</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Board of Directors request that the shareholders ratify its
    selection of PricewaterhouseCoopers LLP as the Company&#146;s
    independent auditor for the fiscal year ending
    September&#160;30, 2007. Representatives of
    PricewaterhouseCoopers will be present at the annual meeting to
    make a statement if they desire to do so and to respond to
    questions by shareholders.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Although not required by the Company&#146;s Bylaws or otherwise,
    the Audit Committee and the Board of Directors believe it
    appropriate, as a matter of good corporate practice, to request
    that the shareholders ratify the appointment of
    PricewaterhouseCoopers LLP as the Company&#146;s independent
    auditor for fiscal 2007. If the shareholders should not so
    ratify, the Audit Committee will reconsider the appointment and
    may retain PricewaterhouseCoopers LLP or another firm without
    <FONT style="white-space: nowrap">re-submitting</FONT>
    the matter to the Company&#146;s shareholders. Even if the
    shareholders vote on an advisory basis in favor of the
    appointment, the Audit Committee may, in its discretion, direct
    the appointment of a different independent registered public
    accounting firm at any time during the year if it determines
    that such a change would be in the best interests of the Company
    and the shareholders.
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">THE BOARD
    OF DIRECTORS RECOMMENDS A VOTE &#147;FOR&#148;<BR>
    APPROVAL OF THIS PROPOSAL</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Unless otherwise instructed, it is the intention of the persons
    named in the accompanying proxy card to vote shares represented
    by properly executed proxy cards &#147;for&#148; this proposal.
</DIV>


<!-- link1 "PROPOSAL 4: SHAREHOLDER PROPOSAL" -->
<DIV align="left"><A NAME="007"></A></DIV>


<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">PROPOSAL&#160;4:&#160;&#160;SHAREHOLDER
    PROPOSAL</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company has received a shareholder proposal from the Sheet
    Metal Workers&#146; National Pension Fund located at
    601&#160;N.&#160;Fairfax Street, Suite&#160;500, Alexandria,
    Virginia 22314 (the &#147;Proponent&#148;). The Proponent, who
    beneficially owns approximately 4,400&#160;shares of the
    Company&#146;s common stock, has requested that we include the
    following proposal (the &#147;Proposal&#148;) and supporting
    statement in this proxy statement for the Annual Meeting. The
    Proposal may be voted on at the Annual Meeting only if properly
    presented by the Proponent or the Proponent&#146;s qualified
    representative.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Resolved:&#160;&#160;That the shareholders of F5 Networks,
    Inc. (&#147;Company&#148;) request that the Board of
    Director&#146;s Executive Compensation Committee establish a
    <FONT style="white-space: nowrap">pay-for-superior-performance</FONT>
    standard in the Company&#146;s executive compensation plan for
    senior executives (&#147;Plan&#148;), by incorporating the
    following principles into the Plan:</I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    1.&#160;<I>The annual incentive or bonus component of the Plan
    should utilize defined financial performance criteria that can
    be benchmarked against a disclosed peer group of companies, and
    provide that an annual bonus is awarded only when the
    Company&#146;s performance exceeds its peers&#146; median or
    mean performance on the selected financial criteria;</I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    2.&#160;<I>The long-term compensation component of the Plan
    should utilize defined financial
    <FONT style="white-space: nowrap">and/or</FONT> stock
    price performance criteria that can be benchmarked against a
    disclosed peer group of companies. Options, restricted shares,
    or other equity or non-equity compensation used in the Plan
    should be structured so that compensation is received only when
    the Company&#146;s performance exceeds its peers&#146; median or
    mean performance on the selected financial and stock price
    performance criteria; and</I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    3.&#160;<I>Plan disclosure should be sufficient to allow
    shareholders to determine and monitor the pay and performance
    correlation established in the Plan.</I>
</DIV>

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    <BR>
    25
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Supporting Statement:&#160;&#160;We feel it is imperative
    that compensation plans for senior executives be designed and
    implemented to promote long-term corporate value. A critical
    design feature of a well-conceived executive compensation plan
    is a close correlation between the level of pay and the level of
    corporate performance relative to industry peers. We believe the
    failure to tie executive compensation to superior corporate
    performance; that is, performance exceeding peer group
    performance, has fueled the escalation of executive compensation
    and detracted from the goal of enhancing long-term corporate
    value.</I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>We believe that common compensation practices have
    contributed to excessive executive compensation. Compensation
    committees typically target senior executive total compensation
    at the median level of a selected peer group, then they design
    any annual and long-term incentive plan performance criteria and
    benchmarks to deliver a significant portion of the total
    compensation target regardless of the company&#146;s performance
    relative to its peers. High total compensation targets combined
    with less than rigorous performance benchmarks yield a pattern
    of superior-pay-for-average-performance. The problem is
    exacerbated when companies include annual bonus payments among
    earnings used to calculate supplement executive retirement plan
    (SERP) benefit levels, guaranteeing excessive levels of lifetime
    income through inflated pension plans.</I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>We believe the Company&#146;s Plan fails to promote the
    <FONT style="white-space: nowrap">pay-for-superior-performance</FONT>
    principle. Our Proposal offers a straightforward solution: The
    Compensation Committee should establish and disclose financial
    and stock price performance criteria and set peer group-related
    performance benchmarks that permit awards or payouts in its
    annual and long-term incentive compensation plans only when the
    Company&#146;s performance exceeds the median of its peer group.
    A senior executive compensation plan based on sound
    <FONT style="white-space: nowrap">pay-for-superior-performance</FONT>
    principles will help moderate excessive executive compensation
    and create competitive compensation incentives that will focus
    senior executives on building sustainable long-term corporate
    value.</I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Board&#146;s
    Statement Opposing the Proposal</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    After careful consideration of the Proposal, and for the reasons
    set forth below, the Company&#146;s Board of Directors strongly
    believes that the Proponent&#146;s proposal to establish a
    <FONT style="white-space: nowrap">pay-for-superior-performance</FONT>
    standard by using the performance of peer companies, rather than
    the Company&#146;s performance, to determine the amount of
    payments under the Company&#146;s performance-based compensation
    plans for senior executives is not in the best interests of the
    Company or the Company&#146;s shareholders for the following
    reasons:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    1.&#160;The objectives and concerns articulated in the Proposal
    are currently being addressed by the compensation practices and
    philosophies of the Compensation Committee of the Company&#146;s
    Board of Directors (the &#147;Committee&#148;). As stated in the
    Compensation Committee Report on Executive Compensation included
    earlier in this proxy statement, the Committee&#146;s current
    approach of linking a significant portion of senior executive
    compensation to F5&#146;s performance aligns the interests of
    the Company&#146;s senior executives with the long-term
    interests of the Company&#146;s shareholders and gives the
    Committee the necessary flexibility and discretion to more
    effectively use performance-based compensation and equity
    incentive tools in the administration of the Company&#146;s
    executive compensation programs. The Committee regularly retains
    outside consultants to review the Company&#146;s existing
    compensation programs and compare it with the compensation
    programs of the Company&#146;s peers to ensure that the
    Company&#146;s overall senior executive compensation system is
    competitive with the Company&#146;s peers and fairly rewards
    both corporate and individual performance. The Company&#146;s
    current performance-based compensation programs have been highly
    effective for attracting, motivating, retaining and rewarding
    the Company&#146;s senior executives while the Company has
    delivered superior results to The Company&#146;s shareholders in
    a very competitive and dynamic industry. As reflected in the
    Stock Price Performance graph on page&#160;20 of this proxy
    statement, for the past one, three and five year periods, the
    Company has outperformed
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    26
</DIV><!-- END LOGICAL PAGE -->
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    significantly both the Nasdaq Composite Index and the Nasdaq
    Computer Index, as shown in the following chart:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="75%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Cumulative Total Return</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>1&#160;year</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>3&#160;years</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>5&#160;years</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">F5 Networks, Inc.&#160;
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    23.58
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    179.21
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    478.88
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">Nasdaq Composite Index
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.96
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    26.39
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    50.68
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-size: 10pt">Nasdaq Computer Index
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.89
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18.09
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    46.65
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    2.&#160;The Proposal focuses on a single compensation principle
    and fails to adequately reflect other more fundamental and
    important principles that should be considered in the
    administration of executive compensation programs. Total
    compensation for senior executives must be competitive to
    attract the best talent, to motivate senior executives to
    perform at their highest levels, to reward outstanding
    achievement, and to retain those individuals with the leadership
    abilities and skills necessary for building long-term
    shareholder value. In addition to incorporating these important
    elements in the Company&#146;s compensation programs, the
    Company&#146;s compensation philosophy focuses on providing
    incentive compensation that is directly linked to the
    performance of the Company and the achievement of the
    Company&#146;s annual and long-term business strategies and
    objectives. The Board of Directors believes that senior
    executives and other employees are much more effectively
    motivated when their performance-based compensation is directly
    tied to their own company&#146;s performance and not tied to the
    performance of &#147;peer companies&#148; over which the
    employees and senior executives have no control. The Company has
    many competitors, all with different business strategies and
    compensation philosophies. Success at the Company should not be
    dictated solely by whether or not the Company&#146;s financial
    results exceed those of the Company&#146;s peers. Compensation
    plans that solely focus on rigid, quantitative, and formulaic
    benchmarks, such as the Proposal, would not provide the
    necessary incentives to senior executives that are consistent
    with the long-term interests of the Company&#146;s shareholders.
    Moreover, the Company&#146;s adoption of the Proposal, without
    the adoption of similar compensation programs by the
    Company&#146;s competitors, would put us in a competitive
    disadvantage for attracting and retaining the Company&#146;s
    senior executives. If we were to adopt the Proposal, talented
    executives and other employees would seek out competitors with
    more robust and dynamic compensation programs that, like the
    Company&#146;s current compensation program, reward outstanding
    achievement based on a diverse set of criteria. In order to
    retain these individuals, and attract others to the Company, the
    Committee needs to be given the discretion to react quickly to
    market changes and continuously provide highly competitive
    compensation packages.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    3.&#160;The Proposal would result in a compensation program that
    is inherently difficult and costly to implement and administer.
    The Proposal is so vague and subject to different
    interpretations that neither the shareholders voting on the
    Proposal, nor the Committee in implementing the Proposal (if
    adopted), would be able to determine with any reasonable
    certainty exactly what actions or measures the Proposal
    requires. The Proposal fails to provide a methodology of process
    by which this list of &#147;peer group companies&#148; would be
    identified. Identifying and re-evaluating this &#147;peer&#148;
    group on an annual basis would be a costly and time-consuming
    process. Moreover, creating a &#147;peer&#148; group that is
    satisfactory to all shareholders would be difficult, if not
    impossible. Also, the Proposal fails to recognize the success
    and effectiveness of the Company&#146;s current compensation
    programs, and does not clearly indicate whether the Committee
    should abolish any or all of the Company&#146;s current
    compensation plans for senior executives or how the Proposal
    would apply to the current compensation plans.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Board of Directors strongly believes that the
    Committee&#146;s current approach and philosophy regarding
    senior executive compensation, as articulated in the
    Committee&#146;s report set forth on pages&#160;14 to 17 of this
    proxy statement, have enabled the Company to attract, retain,
    motivate and reward senior executives who have the experience
    and skills necessary to create significant value for
    shareholders and contribute to the Company&#146;s superior
    overall performance. The Company&#146;s performance-based
    compensation programs have worked well in the past and have been
    a strong contributing factor to the Company&#146;s success over
    the years. The Board of Directors believes that it is in the
    best interests of shareholders to give the Committee the
    flexibility and discretion to use performance-based compensation
    and equity incentive tools as appropriate, without being
    restricted by guidelines that do not adequately address other
    factors that directly link the Company&#146;s operating
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    27
</DIV><!-- END LOGICAL PAGE -->
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    and financial results to executive compensation and that are
    more fundamental to the long-term success of the Company and the
    performance of the Company&#146;s senior executives. For the
    reasons stated above, the Board of Directors believes that the
    adoption of the Proposal is unnecessary and detrimental to the
    long-term interests of the shareholders.
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">THE BOARD
    OF DIRECTORS, WITH THE CONCURRENCE AND APPROVAL OF THE<BR>
    COMMITTEE, RECOMMENDS A VOTE &#147;<U>AGAINST</U>&#148; THE
    PROPOSAL&#160;FOR THE REASONS<BR>
    DISCUSSED ABOVE.</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Unless otherwise instructed, it is the intention of the persons
    named in the accompanying proxy card to vote shares represented
    by properly executed proxy cards &#147;Against&#148; this
    proposal.
</DIV>


<!-- link1 "OTHER BUSINESS" -->
<DIV align="left"><A NAME="008"></A></DIV>


<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">OTHER
    BUSINESS</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Neither the Board of Directors nor management intends to bring
    before the Annual Meeting any business other than the matters
    referred to in the Notice of Meeting and this Proxy Statement.
    If any other business should properly come before the Annual
    Meeting, or any adjournment thereof, the persons named in the
    proxy will vote on such matters according to their best judgment.
</DIV>


<!-- link1 "SHAREHOLDER PROPOSALS FOR THE ANNUAL MEETING FOR FISCAL YEAR END 2007" -->
<DIV align="left"><A NAME="009"></A></DIV>


<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">SHAREHOLDER
    PROPOSALS&#160;FOR THE ANNUAL MEETING FOR FISCAL YEAR END
    2007</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company&#146;s Bylaws provide that advance notice of a
    shareholder&#146;s proposal must be delivered to or mailed and
    received at the Company&#146;s principal executive offices not
    later than the close of business on the ninetieth (90th) day nor
    earlier than the close of business on the one hundred twentieth
    (120th) day prior to the first anniversary of the preceding
    year&#146;s annual meeting. However, the Bylaws also provide
    that in the event the date of the annual meeting has been
    changed by more than thirty (30)&#160;days from the date
    contemplated at the time of the previous year&#146;s proxy
    statement, this advance notice must be received not earlier than
    the close of business on the ninetieth (90th) day prior to such
    annual meeting and not later than the close of business on the
    later of the sixtieth (60th) day prior to such annual meeting
    or, in the event public announcement of the date of such annual
    meeting is first made by the Company fewer than seventy
    (70)&#160;days prior to the date of such annual meeting, the
    close of business on the tenth (10th) day following the day on
    which public announcement of the date of such meeting is first
    made by the Company. Each shareholder&#146;s notice must contain
    the following information as to each matter the shareholder
    proposes to bring before the annual meeting: (A)&#160;a brief
    description of the business desired to be brought before the
    annual meeting and the reasons for conducting such business at
    the annual meeting, (B)&#160;the name and address, as they
    appear on the Company&#146;s books, of the shareholder proposing
    such business, (C)&#160;the class and number of shares of the
    Company which are beneficially owned by the shareholder,
    (D)&#160;any material interest of the shareholder in such
    business and (E)&#160;any other information that is required to
    be provided by the shareholder pursuant to Regulation&#160;14A
    under the Securities Exchange Act of 1934, as amended, in such
    shareholder&#146;s capacity as a proponent of a shareholder
    proposal.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    A copy of the full text of the provisions of the Company&#146;s
    Bylaws dealing with shareholder nominations and proposals is
    available to shareholders from the Secretary of the Company upon
    written request.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Shareholders who intend to have a proposal considered for
    inclusion in the Company&#146;s proxy materials for presentation
    at the Annual Meeting for fiscal year end 2007 must submit the
    proposal to the Company no earlier than November&#160;2, 2007
    and no later than December&#160;4, 2007. Shareholders who intend
    to present a proposal at the Annual Meeting for fiscal year end
    2007 without inclusion of such proposal in the Company&#146;s
    proxy materials are required to provide notice of such proposal
    to the Company no later than December&#160;6, 2007 or management
    of the Company will have discretionary voting authority at the
    fiscal year end 2007 annual meeting with respect to any such
    proposal without discussion of the matter in Proxy Statement for
    such meeting. The Company reserves the right to reject, rule out
    of order, or take appropriate action with respect to any
    proposal that does not comply with these and other applicable
    requirements.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    28
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<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->


<!-- link1 "HOUSEHOLDING OF PROXY MATERIALS" -->
<DIV align="left"><A NAME="010"></A></DIV>


<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">HOUSEHOLDING
    OF PROXY MATERIALS</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The SEC has adopted rules that permit companies and
    intermediaries (e.g., brokers) to satisfy the delivery
    requirements for proxy statements and annual reports with
    respect to two or more shareholders sharing the same address by
    delivering a single proxy statement addressed to those
    shareholders. This process, which is commonly referred to as
    &#147;householding,&#148; potentially means extra convenience
    for shareholders and cost savings for the Company by reducing
    printing and postage costs. Under this procedure, the Company
    will deliver only one copy of the Company&#146;s Annual Report
    to shareholders for fiscal year 2006 (the &#147;2006 Annual
    Report&#148;) and this proxy statement to multiple shareholders
    who share the same address (if they appear to be members of the
    same family), unless the Company has received contrary
    instructions from an affected shareholder.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The 2006 Annual Report and this proxy statement may be found
    under the &#147;investor relations&#148; section of the
    Company&#146;s website at <U>www.f5.com.</U>&#160;&#160;The
    Company will deliver promptly upon written or oral request a
    separate copy of the 2006 Annual Report and this proxy statement
    to any shareholder at a shared address to which a single copy of
    either of those documents was delivered. To receive a separate
    copy of the 2006 Annual Report or this proxy statement,
    shareholders should contact the Company at: Investor Relations,
    F5 Networks, Inc., 401 Elliott Avenue West, Seattle, Washington
    98119.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If you are a shareholder, share an address and last name with
    one or more other shareholders and would like either to request
    delivery of a single copy of the Company&#146;s annual reports
    or proxy statements for yourself and other shareholders who
    share your address or to revoke your householding consent and
    receive a separate copy of the Company&#146;s annual report or
    proxy statement in the future, please contact Automatic Data
    Processing, Inc. (&#147;ADP&#148;), either by calling toll free
    at
    <FONT style="white-space: nowrap">(800)&#160;542-1061</FONT>
    or by writing to ADP, Householding Department, 51 Mercedes Way,
    Edgewood, New York 11717. You will be removed from the
    householding program within 30&#160;days of receipt of the
    revocation of your consent.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    A number of brokerage firms also have instituted householding.
    If you hold your shares in &#147;street name,&#148; please
    contact your bank, broker or other holder of record to request
    information about householding.
</DIV>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    By Order of the Board of Directors,
</DIV>

<DIV style="margin-top: 10pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <IMG src="v26639dev2663903.gif" alt="-s- Jeffrey A. Christianson" >
</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Jeffrey A. Christianson
</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Senior Vice President, General Counsel and Secretary</I>
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    29
</DIV><!-- END LOGICAL PAGE -->
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<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV align="right" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Appendix&#160;A</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>F5 Networks, Inc.</B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>Amended and Restated Charter of the Audit Committee</B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Amended and Restated Charter of the Company&#146;s Audit
    Committee is as follows:
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Purposes:</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The purposes of the audit committee are to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Monitor the integrity of the financial statements of the company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Oversee the accounting and financial reporting processes of the
    company and audits of its financial statements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Oversee the independence of the company&#146;s independent
    auditor.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Appoint and provide for the compensation of a &#147;registered
    public accounting firm&#148; (as that term is defined in
    Section&#160;2(a) of the Sarbanes-Oxley Act of 2002)&#160;to
    serve as the company&#146;s independent auditor, oversee the
    work of the independent auditor (including resolution of any
    disagreements between management and the independent auditor
    regarding financial reporting), evaluate the performance of the
    independent auditor and, if so determined by the audit
    committee, replace the independent auditor; it being
    acknowledged that the independent auditor is ultimately
    accountable to the board of directors and the committee, as
    representatives of the company&#146;s stockholders.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Composition:</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The audit committee shall be composed of three or more
    directors, as determined by the board of directors, each of whom
    shall be &#147;independent&#148;, as that term is defined in
    Section&#160;10A(m) of the Securities Exchange Act of 1934 (the
    &#147;Exchange Act&#148;), and the applicable rules and
    regulations (&#147;Regulations&#148;) of the SEC, each of whom
    shall meet the independence and financial literacy requirements
    of the NASDAQ, and at least one of whom shall have past
    employment experience in finance or accounting, requisite
    professional certification in accounting, or any other
    comparable experience or background which results in the
    individual&#146;s financial sophistication, including being or
    having been chief executive officer, chief financial officer or
    other senior officer with financial oversight responsibilities.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Unless a chair is designated by the board of directors, the
    committee members may appoint their own chair by majority vote.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Responsibilities:</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Appoint and provide for the compensation of a &#147;registered
    public accounting firm&#148; (as that term is defined in
    Section&#160;2(a) of the Sarbanes-Oxley Act of 2002)&#160;to
    serve as the company&#146;s independent auditor, oversee the
    work of the independent auditor (including resolution of any
    disagreements between management and the independent auditor
    regarding financial reporting), evaluate the performance of the
    independent auditor and, if so determined by the audit
    committee, replace the independent auditor; it being
    acknowledged that the independent auditor is ultimately
    accountable to the board of directors and the committee, as
    representatives of the company&#146;s stockholder
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Evaluate periodic reports that the independent auditor submits
    to the audit committee regarding the auditor&#146;s
    independence, discuss such reports with the auditor and, if so
    determined by the audit committee in response to such reports,
    recommend that the board of directors take appropriate action to
    oversee the independence of the independent auditor.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Systematically and periodically review the internal controls
    over financial reporting established by management.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    A-1
</DIV><!-- END LOGICAL PAGE -->
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Meet with management and the independent auditor to discuss the
    annual financial statements and the report of the independent
    auditor thereon, and to discuss significant issues encountered
    in the course of the audit work, including: restrictions on the
    scope of activities; access to required information; the
    adequacy of internal financial controls; the adequacy of the
    disclosure of off-balance sheet transactions, arrangements,
    obligations and relationships in reports filed with the SEC; and
    the appropriateness of the presentation of any non-GAAP
    financial measures (as defined in the Regulations) included in
    any report filed with the SEC or in any public disclosure or
    release.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Review the management letter delivered by the independent
    auditor in connection with the audit.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Discuss with the independent auditor the matters required to be
    discussed by SAS 61, as it may be modified or supplemented
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Following such reviews and discussions, if so determined by the
    audit committee, recommend to the board of directors that the
    annual financial statements be included in the company&#146;s
    annual report.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Meet quarterly with management and the independent auditor to
    review and discuss the quarterly financial statements; provided
    that this responsibility may be delegated to the chairman of the
    audit committee.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Meet at least once each year in separate executive sessions with
    management and the independent auditor to discuss matters that
    the committee or either of these groups believes could
    significantly affect the financial statements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Have meetings with management as the audit committee deems
    appropriate to discuss significant financial risk exposures
    facing the company, and steps management has taken to monitor
    and control such exposures.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Instruct the independent auditor and the internal auditor, if
    any, to advise the audit committee if there are any subjects
    that require special attention.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Instruct the independent auditor to report to the audit
    committee on all critical accounting policies of the company,
    all alternative treatments of financial information within
    generally accepted accounting principles that have been
    discussed with management, ramifications of the use of such
    alternative disclosures and treatments and the treatment
    preferred by the auditors, and other material written
    communication between the auditors and management
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Review significant changes to the company&#146;s accounting
    principles and practices proposed by the independent auditor or
    management.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Evaluate the performance of the independent auditor and, if so
    determined by the audit committee, recommend to the board of
    directors replacement of the independent auditor.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At the request of the company counsel, review with the company
    counsel legal and regulatory matters that may have significant
    impact on the company&#146;s financial statements, compliance
    policies or programs.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Conduct or authorize such inquiries into matters within the
    committee&#146;s scope of responsibility as the committee deems
    appropriate. The committee shall be empowered to retain
    independent counsel and other professionals to assist in the
    conduct of any such inquiries.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Provide minutes of audit committee meetings to the board of
    directors, and report to the board of directors on any
    significant matters arising from the committee&#146;s work.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At least annually, review and reassess this charter and, if
    appropriate, recommend proposed changes to the board of
    directors.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Prepare the report required by the rules of the Securities and
    Exchange Commission to be included in the company&#146;s annual
    proxy statement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Establish a procedure for receipt, retention and treatment of
    any complaints received by the Company about its accounting,
    internal accounting controls or auditing matters and for the
    confidential and anonymous submission by employees of concerns
    regarding questionable accounting or auditing matters.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    A-2
</DIV><!-- END LOGICAL PAGE -->
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Approve, in accordance with Sections&#160;10A(h) and (i)&#160;of
    the Exchange Act and the Regulations, all professional services,
    to be provided to the company by its independent auditor,
    provided that the audit committee shall not approve any
    non-audit services proscribed by Section&#160;10A(g) of the
    Exchange Act in the absence of an applicable exemption. The
    audit committee may adopt policies and procedures for the
    approval of such services which may include delegation of
    authority to a designated member or members of the audit
    committee to approve such services so long as any such approvals
    are disclosed to the full audit committee at its next scheduled
    meeting.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Review and approve all related party transactions.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Authority:</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    By adopting this Charter, the board of directors delegates to
    the audit committee full authority in its discretion to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Perform each of the responsibilities of the audit committee
    described above.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Appoint a chair of the audit committee, unless a chair is
    designated by the board of directors.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Engage independent counsel and other advisers as the audit
    committee determines necessary to carry out its responsibilities.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Cause the officers of the corporation to provide such funding as
    the audit committee shall determine to be appropriate for
    payment of compensation to the company&#146;s independent
    auditor and any legal counsel or other advisers engaged by the
    audit committee, and payment of ordinary administrative expenses
    of the audit committee that are necessary or appropriate in
    carrying out its duties.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>It is not the responsibility of the audit committee to plan
    or conduct audits, or to determine whether the company&#146;s
    financial statements are complete and accurate or in accordance
    with generally accepted accounting principles. It is not the
    responsibility of the audit committee to conduct inquiries, to
    resolve disagreements, if any, between management and the
    independent auditor, or to assure compliance with laws,
    regulations or company compliance policies or program</I>s.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    A-3
</DIV><!-- END LOGICAL PAGE -->
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV align="right" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Appendix&#160;B</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-variant: SMALL-CAPS">F5 Networks,
    Inc.</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>2005 <FONT style="font-variant: SMALL-CAPS">Equity Incentive
    Plan</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Adopted
    December&#160;31, 2004<BR>
    Original Approval By Shareholders February&#160;24, 2005<BR>
    Amended By Board of Directors on January&#160;8, 2007 and
    January&#160;23, 2007<BR>
    Termination Date: December&#160;30, 2014</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    1.&#160;<FONT style="font-variant: SMALL-CAPS">Purposes.
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(a)&#160;</B><I>Eligible Stock Award
    Recipients.</I>&#160;&#160;The persons eligible to receive Stock
    Awards are the Employees, Directors and Consultants of the
    Company and its Affiliates.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(b)&#160;</B><I>Available Stock Awards.</I>&#160;&#160;The
    purpose of the Plan is to provide a means by which eligible
    recipients of Stock Awards may be given an opportunity to
    benefit from increases in value of the Common Stock through the
    granting of the following Stock Awards: (i)&#160;Options and
    (ii)&#160;Stock Units.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(c)&#160;</B><I>General Purpose.</I>&#160;&#160;The Company,
    by means of the Plan, seeks to retain the services of the group
    of persons eligible to receive Stock Awards, to secure and
    retain the services of new members of this group and to provide
    incentives for such persons to exert maximum efforts for the
    success of the Company and its Affiliates.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    2.&#160;<FONT style="font-variant: SMALL-CAPS">Definitions.
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;<I>&#147;Affiliate&#148; </I>means any parent
    corporation or subsidiary corporation of the Company, whether
    now or hereafter existing, as those terms are defined in
    Sections&#160;424(e) and (f), respectively, of the Code.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;<I>&#147;Applicable Laws</I>&#148; means the legal
    requirements relating to the administration of equity
    compensation plans, including under applicable U.S.&#160;state
    corporate laws, U.S.&#160;federal and applicable state
    securities laws, other U.S.&#160;federal and state laws, the
    Code, any stock exchange rules or regulations and the applicable
    laws, rules and regulations of any other country or jurisdiction
    where Stock Awards are granted under the Plan, as such laws,
    rules, regulations and requirements shall be in place from time
    to time.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;<I>&#147;Board&#148; </I>means the Board of Directors
    of the Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (d)&#160;<I>&#147;Code&#148; </I>means the Internal Revenue Code
    of 1986, as amended.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (e)&#160;<I>&#147;Committee&#148; </I>means a committee
    appointed by the Board in accordance with subsection&#160;3(c).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (f)&#160;<I>&#147;Common Stock&#148; </I>means the common stock
    of the Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (g)&#160;<I>&#147;Company&#148; </I>means F5 Networks, Inc., a
    Washington corporation.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (h)&#160;<I>&#147;Consultant&#148; </I>means any person,
    including an advisor, (i)&#160;who is engaged by the Company or
    an Affiliate to render services other than as an Employee or as
    a Director or (ii)&#160;who is a member of the Board of
    Directors of an Affiliate.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (i)&#160;<I>&#147;Continuous Service&#148; </I>means that the
    Participant&#146;s service with the Company or an Affiliate,
    whether as an Employee, Director or Consultant, is not
    interrupted or terminated. The Participant&#146;s Continuous
    Service shall not be deemed to have terminated merely because of
    a change in the capacity in which the Participant renders
    service to the Company or an Affiliate as an Employee,
    Consultant or Director or a change in the entity among the
    Company or an Affiliate for which the Participant renders such
    service, provided that there is no interruption or termination
    of the Participant&#146;s Continuous Service. For example, a
    change in status from an Employee of the Company to a Consultant
    of an Affiliate or a Director of the Company will not constitute
    an interruption of Continuous Service. Subject to
    Section&#160;6(e)(ii), the Board or the chief executive officer
    of the Company, in that party&#146;s sole discretion, may
    determine whether Continuous Service shall be considered
    interrupted in the case of any leave of absence approved by that
    party, including sick leave, military leave or any other
    personal leave.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    B-1
</DIV><!-- END LOGICAL PAGE -->
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (j)&#160;<I>&#147;Covered Employee&#148; </I>means the chief
    executive officer and the four (4)&#160;other highest
    compensated officers of the Company for whom total compensation
    is required to be reported to shareholders under the Exchange
    Act, as determined for purposes of Section&#160;162(m) of the
    Code.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (k)&#160;<I>&#147;Director&#148; </I>means a member of the Board
    of Directors of the Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (l)&#160;<I>&#147;Disability&#148; </I>means the permanent and
    total disability of a person within the meaning of
    Section&#160;22(e)(3) of the Code.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (m)&#160;<I>&#147;Employee&#148; </I>means any person employed
    by the Company or an Affiliate. Subject to the Applicable Laws,
    the determination of whether an individual (including a leased
    and temporary employees) is an Employee hereunder shall be made
    by the Board (or its Committee), in its sole discretion. Mere
    service as a Director or payment of a director&#146;s fee by the
    Company or an Affiliate shall not be sufficient to constitute
    &#147;employment&#148; by the Company or an Affiliate.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (n)&#160;<I>&#147;Exchange Act&#148; </I>means the Securities
    Exchange Act of 1934, as amended.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (o)&#160;<I>&#147;Fair Market Value&#148; </I>means, as of any
    date, the value of the Common Stock determined as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (i)&#160;If the Common Stock is listed on any established stock
    exchange or traded on the Nasdaq National Market, the Fair
    Market Value of a Share shall be the closing sales price for
    such stock (or the closing bid, if no sales were reported) as
    quoted on such exchange or market (or such other exchange or
    market with the greatest volume of trading in the Common Stock)
    on the day of determination or, if the day of determination is
    not a market trading day, then on the last market trading day
    prior to the day of determination, as reported in such source or
    sources as the Board deems reliable,&#160;or
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (ii)&#160;In the absence of such markets for the Common Stock,
    the Fair Market Value shall be determined in good faith by the
    Board.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (p)&#160;<I>&#147;Independent Director&#148; </I>means a
    Director who qualifies as an &#147;independent&#148; director
    under applicable Nasdaq rules (or the rules of any exchange on
    which the Common Stock is then listed or approved for listing).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (q)&#160;<I>&#147;Non-Employee Director&#148; </I>means a
    Director of the Company who either (i)&#160;is not a current
    Employee or Officer of the Company or its parent or a
    subsidiary, does not receive compensation (directly or
    indirectly) from the Company or its parent or a subsidiary for
    services rendered as a consultant or in any capacity other than
    as a Director (except for an amount as to which disclosure would
    not be required under Item&#160;404(a) of
    <FONT style="white-space: nowrap">Regulation&#160;S-K</FONT>
    promulgated pursuant to the Securities Act
    <FONT style="white-space: nowrap">(&#147;Regulation&#160;S-K&#148;)),</FONT>
    does not possess an interest in any other transaction as to
    which disclosure would be required under Item&#160;404(a) of
    <FONT style="white-space: nowrap">Regulation&#160;S-K</FONT>
    and is not engaged in a business relationship as to which
    disclosure would be required under Item&#160;404(b) of
    <FONT style="white-space: nowrap">Regulation&#160;S-K;</FONT>
    or (ii)&#160;is otherwise considered a &#147;non-employee
    director&#148; for purposes of
    <FONT style="white-space: nowrap">Rule&#160;16b-3.</FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (r)&#160;<I>&#147;Officer&#148; </I>means a person who is an
    officer of the Company within the meaning of Section&#160;16 of
    the Exchange Act and the rules and regulations promulgated
    thereunder.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (s)&#160;<I>&#147;Option&#148; </I>means a nonstatutory stock
    option (meaning, an option not intended to qualify as an
    incentive stock option under Code Section&#160;422)&#160;granted
    pursuant to the Plan.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (t)&#160;<I>&#147;Outside Director&#148; </I>means a Director of
    the Company who either (i)&#160;is not a current Employee of the
    Company or an &#147;affiliated corporation&#148; (within the
    meaning of Treasury Regulations promulgated under
    Section&#160;162(m) of the Code), is not a former Employee of
    the Company or an &#147;affiliated corporation&#148; receiving
    compensation for prior services (other than benefits under a tax
    qualified pension plan), was not an officer of the Company or an
    &#147;affiliated corporation&#148; at any time and is not
    currently receiving direct or indirect remuneration from the
    Company or an &#147;affiliated corporation&#148; for services in
    any capacity other than as a Director or (ii)&#160;is otherwise
    considered an &#147;outside director&#148; for purposes of
    Section&#160;162(m) of the Code.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (u)&#160;<I>&#147;Participant&#148; </I>means a person to whom a
    Stock Award is granted pursuant to the Plan or, if applicable,
    such other person who holds an outstanding Stock Award.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (v)&#160;<I>&#147;Plan&#148; </I>means this F5 Networks, Inc.
    2005 Equity Incentive Plan.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    B-2
</DIV><!-- END LOGICAL PAGE -->
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<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (w)&#160;<I><FONT style="white-space: nowrap">&#147;Rule&#160;16b-3&#148;</FONT>
    </I>means
    <FONT style="white-space: nowrap">Rule&#160;16b-3</FONT>
    promulgated under the Exchange Act or any successor to
    <FONT style="white-space: nowrap">Rule&#160;16b-3,</FONT>
    as in effect from time to time.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (x)&#160;<I>&#147;Securities Act&#148; </I>means the Securities
    Act of 1933, as amended.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (y)&#160;<I>&#147;Share</I><B>&#148; </B>means a share of the
    Common Stock, as adjusted in accordance with Section&#160;11
    below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (z)&#160;<I>&#147;Stock Award&#148; </I>means any right
    involving Shares granted under the Plan, including an Option or
    Stock Unit.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (aa)&#160;<I>&#147;Stock Award Agreement&#148; </I>means a
    written agreement between the Company and a holder of a Stock
    Award evidencing the terms and conditions of an individual Stock
    Award grant. Each Stock Award Agreement shall be subject to the
    terms and conditions of the Plan.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (bb)&#160;<I>&#147;Stock Unit</I>&#148; means an award giving
    the right to receive Shares granted under Section&#160;7 below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    3.&#160;<FONT style="font-variant: SMALL-CAPS">Administration.
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(a)&#160;</B><I>Administration by Board.</I>&#160;&#160;The
    Board shall administer the Plan unless and until the Board
    delegates administration to a Committee or an administrator, as
    provided in subsection&#160;3(c).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(b)&#160;</B><I>Powers of Board.</I>&#160;&#160;The Board
    shall have the power, subject to, and within the limitations of,
    the express provisions of the Plan:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(i)&#160;</B>To determine from time to time which of the
    persons eligible under the Plan shall be granted Stock Awards;
    when and how each Stock Award shall be granted; what type or
    combination of types of Stock Awards shall be granted; the
    provisions, terms and conditions of each Stock Award granted
    (which need not be identical as among Participants or as among
    types of Stock Awards), including, without limitation: the time
    or times when a person shall be permitted to receive Shares
    pursuant to a Stock Award, the number of Shares with respect to
    which a Stock Award shall be granted to each such person, the
    exercise or purchase price (if any) of a Stock Award, the time
    or times when Stock Awards may be exercised (which may be based
    on performance criteria), any vesting acceleration or waiver of
    forfeiture restrictions, any pro rata adjustment to vesting as a
    result of a Participant&#146;s transitioning from full- to
    part-time service (or vice versa), and any other restriction
    (including forfeiture restriction), limitation or term of any
    Stock Award, based in each case on such factors as the Board, in
    its sole discretion, shall determine; provided, however, that
    such provisions, terms and conditions are not inconsistent with
    the terms of the Plan.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(ii)&#160;</B>In order to fulfill the purposes of the Plan
    and without amending the Plan, to modify grants of Stock Awards
    to Participants who are foreign nationals or employed outside of
    the United States in order to recognize differences in local
    law, tax policies or customs.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(iii)&#160;</B>To construe and interpret the Plan and Stock
    Awards granted under it, and to establish, amend and revoke
    rules and regulations for its administration. The Board, in the
    exercise of this power, may correct any defect, omission or
    inconsistency in the Plan or in any Stock Award Agreement, in a
    manner and to the extent it shall deem necessary or expedient to
    make the Plan fully effective.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(iv)&#160;</B>To amend the Plan or a Stock Award as provided
    in Section&#160;12.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(v)&#160;</B>Generally, to exercise such powers and to
    perform such acts as the Board deems necessary or expedient to
    promote the best interests of the Company which are not in
    conflict with the provisions of the Plan.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(c)&#160;</B><I>Delegation to Committee.</I>&#160;&#160;The
    Board may delegate administration of the Plan to a Committee or
    Committees of one or more members of the Board, and the term
    &#147;Committee&#148; shall apply to any person or persons to
    whom such authority has been delegated. In the discretion of the
    Board, the Committee may consist solely of two or more Outside
    Directors, in accordance with Section&#160;162(m) of the Code,
    <FONT style="white-space: nowrap">and/or</FONT>
    solely of two or more Non-Employee Directors, in accordance with
    <FONT style="white-space: nowrap">Rule&#160;16b-3,</FONT>
    <FONT style="white-space: nowrap">and/or</FONT>
    solely of two or more Independent Directors under applicable
    Nasdaq (or other exchange) rules. The Board or the Committee may
    further delegate its authority and responsibilities under the
    Plan to an Officer. However, if administration is delegated
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    B-3
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    to an Officer, such Officer may grant Stock Awards only within
    guidelines established by the Board or the Committee, and only
    the Board or the Committee may make a Stock Award to an Officer
    or Director. If administration is delegated to a Committee, the
    Committee shall have, in connection with the administration of
    the Plan, the powers theretofore possessed by the Board,
    including the power to delegate to a subcommittee any of the
    administrative powers the Committee is authorized to exercise
    (and references in this Plan to the Board shall thereafter be to
    the Committee or subcommittee, or an Officer to whom authority
    has been delegated), subject, however, to such resolutions, not
    inconsistent with the provisions of the Plan, as may be adopted
    from time to time by the Board. The Board may abolish the
    Committee at any time and revest in the Board the administration
    of the Plan, and unless otherwise specified by the Board shall
    retain any authority granted to a committee or individual
    hereunder unto itself.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    4.&#160;<FONT style="font-variant: SMALL-CAPS">Shares&#160;Subject
    to the Plan.
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(a)&#160;</B><I>Share Reserve.</I>&#160;&#160;Subject to the
    provisions of Section&#160;11 relating to adjustments upon
    changes in stock, the stock that may be issued pursuant to Stock
    Awards shall not exceed in the aggregate Three Million Seven
    Hundred Thousand (3,700,000) Shares of Common Stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(b)&#160;</B><I>Section&#160;162(m) Limitation on Share
    Numbers.</I>&#160;&#160;No Employee shall be eligible to be
    granted Stock Awards covering more than One Million (1,000,000)
    Shares during any fiscal year of the Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(c)&#160;</B><I>Reversion of Shares to the Share
    Reserve.</I>&#160;&#160;If any Stock Award shall for any reason
    expire or otherwise terminate, in whole or in part, without
    having been exercised in full, the Shares not acquired under
    such Stock Award shall revert to and again become available for
    issuance under the Plan. Further, if any previously-issued
    Shares are forfeited under the terms and conditions of the Stock
    Award, then any Shares so forfeited shall revert to and again
    become available for issuance under the Plan. The provisions of
    this Section&#160;4(c) are qualified by Section&#160;4(a) such
    that the total number of Shares issued and outstanding under the
    Plan at any time may not exceed the number set forth in
    Section&#160;4(a) (as adjusted under Section&#160;11).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(d)&#160;</B><I>Source of Shares.</I>&#160;&#160;The stock
    subject to the Plan may be unissued Shares or reacquired Shares,
    bought on the market or otherwise.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    5.&#160;<I><FONT style="font-variant: SMALL-CAPS">Eligibility.</FONT></I>
    Stock Awards may be granted to Employees, Directors and
    Consultants.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    6.&#160;<FONT style="font-variant: SMALL-CAPS">Option
    Provisions</FONT>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Each Option shall be in such form and shall contain such terms
    and conditions as the Board shall deem appropriate. The
    provisions of separate Options need not be identical, but each
    Option shall include (through incorporation of provisions hereof
    by reference in the Option or otherwise) the substance of each
    of the following provisions:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(a)&#160;</B><I>Term.</I>&#160;&#160;No Option shall be
    exercisable after the expiration of ten (10)&#160;years from the
    date it was granted.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(b)&#160;</B><I>Exercise Price of an
    Option.</I>&#160;&#160;The exercise price of each Option shall
    be at least equal to the Fair Market Value of the stock subject
    to the Option on the date the Option is granted. Notwithstanding
    the foregoing, an Option may be granted with an exercise price
    lower than that set forth in the preceding sentence if such
    Option is granted pursuant to an assumption or substitution for
    another option in a manner satisfying the provisions of
    Section&#160;424(a) of the Code.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(c)&#160;</B><I>Consideration.</I>&#160;&#160;The purchase
    price of stock acquired pursuant to an Option shall be paid, to
    the extent permitted by applicable statutes and regulations,
    either (i)&#160;in cash, check or wire transfer at the time the
    Option is exercised or (ii)&#160;at the discretion of the Board
    at the time of the grant of the Option or subsequently by
    (1)&#160;by delivery to the Company of other Shares that have a
    Fair Market Value on the date of surrender equal to the
    aggregate exercise price of the Shares as to which the Option is
    exercised, provided that in the case of Shares acquired,
    directly or indirectly, from the Company, such Shares must have
    been owned by the Participant for more than six (6)&#160;months
    on the date of surrender (or such other period as may be
    required to avoid the Company&#146;s incurring an adverse
    accounting charge), (2)&#160;if, as of the date of exercise of
    an Option the Company then is permitting Employees to engage in
    a
    <FONT style="white-space: nowrap">&#147;same-day</FONT>
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    B-4
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<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    sale&#148; cashless brokered exercise program involving one or
    more brokers, through such a program that complies with the
    Applicable Laws (including without limitation the requirements
    of Regulation&#160;T and other applicable regulations
    promulgated by the Federal Reserve Board) and that ensures
    prompt delivery to the Company of the amount required to pay the
    exercise price and any applicable withholding taxes, (3)&#160;in
    any other form of legal consideration that may be acceptable to
    the Board, or (4)&#160;any combination of the foregoing methods.
    In making its determination as to the type of consideration to
    accept, the Board shall consider if acceptance of such
    consideration may be reasonably expected to benefit the Company
    and the Board may, in its sole discretion, refuse to accept a
    particular form of consideration at the time of any Option
    exercise.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(d)&#160;</B><I>Transferability of an
    Option.</I>&#160;&#160;The Option shall not be transferable
    except by will or by the laws of descent and distribution and
    shall be exercisable during the lifetime of the Participant only
    by the Participant. Notwithstanding the foregoing provisions of
    this subsection&#160;6(d), the Participant may, by delivering
    written notice to the Company, in a form satisfactory to the
    Company, designate a third party who, in the event of the death
    of the Participant, shall thereafter be entitled to exercise the
    Option.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(e)&#160;</B><I>Vesting.</I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 8%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (<B>i)&#160;</B><I>Generally.</I>&#160;&#160;The total number of
    Shares of Common Stock subject to an Option may, but need not,
    vest and therefore become exercisable in periodic installments
    which may, but need not, be equal. The Option may be subject to
    such other terms and conditions on the time or times when it may
    be exercised (which may be based on performance or other
    criteria) as the Board may deem appropriate. The vesting
    provisions of individual Options may vary. The provisions of
    this subsection&#160;6(e) are subject to any Option provisions
    governing the minimum number of Shares as to which an Option may
    be exercised.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 8%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(ii)&#160;</B><I>Leave of Absence.</I>&#160;&#160;The Board
    (or any other party to whom such authority has been delegated,
    including under this Plan) shall have the discretion to
    determine whether and to what extent the vesting of Options
    shall be tolled during any unpaid leave of absence; <I>provided,
    however, </I>that in the absence of such determination, vesting
    of Options shall be tolled during any such unpaid leave (unless
    otherwise required by the Applicable Laws). In the event of
    military leave, vesting shall toll during any unpaid portion of
    such leave, provided that, upon a Participant&#146;s returning
    from military leave (under conditions that would entitle him or
    her to protection upon such return under the Uniform Services
    Employment and Reemployment Rights Act), he or she shall be
    given vesting credit with respect to Options to the same extent
    as would have applied had the Participant continued to provide
    services to the Company throughout the leave on the same terms
    as he or she was providing services immediately prior to such
    leave.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(f)&#160;</B><I>Termination of Continuous
    Service.</I>&#160;&#160;In the event a Participant&#146;s
    Continuous Service terminates (other than upon the
    Participant&#146;s death or Disability), the Participant may
    exercise his or her Option (to the extent that the Participant
    was vested in the Option Shares and entitled to exercise such
    Option as of the date of termination) but only within such
    period of time ending on the earlier of (i)&#160;the date three
    (3)&#160;months following the termination of the
    Participant&#146;s Continuous Service (or such longer or shorter
    period specified in the Option Agreement), or (ii)&#160;the
    expiration of the term of the Option as set forth in the Option
    Agreement. If, after termination, the Participant does not
    exercise his or her Option within the time specified in the
    Option Agreement, the Option shall terminate.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(g)&#160;</B><I>Extension of Termination
    Date.</I>&#160;&#160;Following the termination of the
    Participant&#146;s Continuous Service (other than upon the
    Participant&#146;s death or Disability), if the Participant
    would be prohibited at any time solely because the issuance of
    Shares would violate the registration requirements under the
    Securities Act or violate any prohibition on trading on the
    basis of possession of material nonpublic information involving
    the Company and its business, then the Option shall terminate on
    the earlier of (i)&#160;the expiration of the term of the Option
    set forth in subsection&#160;6(a), or (ii)&#160;the expiration
    of a period of three (3)&#160;months after the termination of
    the Participant&#146;s Continuous Service during which the
    exercise of the Option would not be in violation of such
    requirements.
</DIV>

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    <BR>
    B-5
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<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(h)&#160;</B><I>Disability of Participant.</I>&#160;&#160;In
    the event a Participant&#146;s Continuous Service terminates as
    a result of the Participant&#146;s Disability, the Participant
    may exercise his or her Option (to the extent that the
    Participant was vested in the Option Shares and entitled to
    exercise the Option as of the date of termination), but only
    within such period of time ending on the earlier of (i)&#160;the
    date twelve (12)&#160;months following such termination (or such
    longer or shorter period specified in the Option Agreement) or
    (ii)&#160;the expiration of the term of the Option as set forth
    in the Option Agreement. If, after termination, the Participant
    does not exercise his or her Option within the time specified
    herein, the Option shall terminate.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(i)&#160;</B><I>Death of Participant.</I>&#160;&#160;In the
    event (i)&#160;an Participant&#146;s Continuous Service
    terminates as a result of the Participant&#146;s death or
    (ii)&#160;the Participant dies within the period (if any)
    specified in the Option Agreement after the termination of the
    Participant&#146;s Continuous Service for a reason other than
    death, then the Option may be exercised (to the extent the
    Participant was vested in the Option Shares and entitled to
    exercise the Option as of the date of death) by the
    Participant&#146;s estate, by a person who acquired the right to
    exercise the Option by bequest or inheritance or by a person
    designated to exercise the Option upon the Participant&#146;s
    death pursuant to subsection&#160;6(d), but only within the
    period ending on the earlier of (1)&#160;the date eighteen
    (18)&#160;months following the date of death (or such longer or
    shorter period specified in the Option Agreement) or
    (2)&#160;the expiration of the term of such Option as set forth
    in the Option Agreement. If, after death, the Option is not
    exercised within the time specified herein, the Option shall
    terminate.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(j)&#160;</B><I>Exercise Generally.</I>&#160;&#160;Options
    shall be considered exercised when the Company (or its
    authorized agent) receives (i)&#160;written or electronic notice
    from the person entitled to exercise the Option of intent to
    exercise a specific number of Shares, (ii)&#160;full payment or
    appropriate provision for payment in a form and method
    acceptable to the Board or Committee, for the Shares being
    exercised, and (iii)&#160;if applicable, payment or appropriate
    provision for payment of any withholding taxes due on exercise.
    An Option may not be exercised for a fraction of a Share. The
    Option may, at the discretion of the Board or Committee, include
    a provision whereby the Participant may elect to exercise the
    Option as to Shares that are not yet vested. Unvested Shares
    exercised in such manner may be subject to a Company repurchase
    right under Section&#160;10(f) or such other restrictions or
    conditions as the Board or Committee may determine.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(k)&#160;</B><I>Administrator
    Discretion.</I>&#160;&#160;Notwithstanding the provisions of
    this Section&#160;6, the Board or the Committee shall have
    complete discretion exercisable at any time to (i)&#160;extend
    the period of time for which an Option is to remain exercisable,
    following the Participant&#146;s termination of Continuous
    Service, but in no event beyond the expiration date for the
    Option, and (ii)&#160;permit the Option to be exercised, during
    the applicable post-termination exercise period, not only with
    respect to the number of Shares that were vested on the date of
    termination, cut also with respect to additional Shares on such
    terms and conditions as the Board or Committee may determine.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    7.&#160;<I><FONT style="font-variant: SMALL-CAPS">Provisions of
    Stock Awards other than Options.</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Each Stock Award Agreement reflecting the issuance of a Stock
    Unit shall be in such form and shall contain such terms and
    conditions as the Board shall deem appropriate. The terms and
    conditions of such agreements may change from time to time, and
    the terms and conditions of separate agreements need not be
    identical, but each such agreement shall include (through
    incorporation of provisions hereof by reference in the agreement
    or otherwise) the substance of each of the following provisions:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(a)&#160;</B><I>Consideration.</I>&#160;&#160;A Stock Unit
    may be awarded in consideration for such property or services as
    is permitted under Applicable Law, including for past services
    actually rendered to the Company or an Affiliate for its benefit.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(b)&#160;</B><I>Vesting; Restrictions.</I>&#160;&#160;Shares
    of Common Stock awarded under the agreement reflecting a Stock
    Unit award may, but need not, be subject to a Share repurchase
    option, forfeiture restriction or other conditions in favor of
    the Company in accordance with a vesting or lapse schedule to be
    determined by the Board.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    B-6
</DIV><!-- END LOGICAL PAGE -->
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(c)&#160;</B><I>Termination of Participant&#146;s Continuous
    Service.</I>&#160;&#160;In the event a Participant&#146;s
    Continuous Service terminates, the Company may reacquire any or
    all of the Shares of Common Stock held by the Participant which
    have not vested or which are otherwise subject to forfeiture or
    other conditions as of the date of termination under the terms
    of the agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(d)&#160;</B><I>Transferability.</I>&#160;&#160;Rights to
    acquire Shares of Common Stock under a Stock Unit agreement
    shall not be transferable except by will or by the laws of
    descent and distribution, and Shares of Common Stock issued upon
    vesting of a Stock Unit shall be issuable during the lifetime of
    the Participant only to the Participant. Notwithstanding the
    foregoing provisions of this subsection&#160;7(d), the
    Participant may, by delivering written notice to the Company, in
    a form satisfactory to the Company, designate a third party who,
    in the event of the death of the Participant, shall thereafter
    be entitled to receive Shares of Common Stock issued upon
    vesting of a Stock Unit.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    8.&#160;<FONT style="font-variant: SMALL-CAPS">Covenants of the
    Company.
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(a)&#160;</B><I>Availability of Shares.</I>&#160;&#160;During
    the terms of the Stock Awards, the Company shall keep available
    at all times the number of Shares of Common Stock required to
    satisfy such Stock Awards.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(b)&#160;</B><I>Securities Law Compliance.</I>&#160;&#160;The
    Company shall seek to obtain from each regulatory commission or
    agency having jurisdiction over the Plan such authority as may
    be required to grant Stock Awards and to issue and sell Shares
    upon exercise of the Stock Awards; provided, however, that this
    undertaking shall not require the Company to register under the
    Securities Act the Plan, any Stock Award or any stock issued or
    issuable pursuant to any such Stock Award. If, after reasonable
    efforts, the Company is unable to obtain from any such
    regulatory commission or agency the authority which counsel for
    the Company deems necessary for the lawful issuance and sale of
    stock under the Plan, the Company shall be relieved from any
    liability for failure to issue and sell stock upon exercise of
    such Stock Awards unless and until such authority is obtained.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    9.&#160;<FONT style="font-variant: SMALL-CAPS">Use of Proceeds
    from Stock; Unfunded Plan.
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Proceeds from the sale of stock pursuant to Stock Awards shall
    constitute general funds of the Company. The Plan shall be
    unfunded. Although bookkeeping accounts may be established with
    respect to Participants who are granted Stock Awards hereunder,
    any such accounts will be used merely as a bookkeeping
    convenience. The Company shall not be required to segregate any
    asset which may at any time be represented by Stock Awards, nor
    shall this Plan be construed as providing for such segregation,
    nor shall the Company nor any party authorized to administer the
    Plan be deemed to be a trustee of stock or cash to be awarded
    under the Plan. Any liability of the Company to any Participant
    with respect to a Stock Award shall be based solely upon any
    contractual obligations which may be created by the Plan; no
    such obligation of the Company shall be deemed to be secured by
    any pledge or other encumbrance on any property of the Company.
    Neither the Company nor any party authorized to administer the
    Plan shall be required to give any security or bond for the
    performance of any obligation which may be created by this Plan.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    10.&#160;<FONT style="font-variant: SMALL-CAPS">Miscellaneous.
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(a)&#160;</B><I>Acceleration of Exercisability and
    Vesting.</I>&#160;&#160;The Board shall have the power to
    accelerate the time at which a Stock Award may first be
    exercised or the time during which a Stock Award or any part
    thereof will vest, become exercisable or be settled in
    accordance with the Plan, notwithstanding the provisions in the
    Stock Award stating the time at which it may first vest, be
    exercised or be settled.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(b)&#160;</B><I>Shareholder Rights.</I>&#160;&#160;No
    Participant shall be deemed to be the holder of, or to have any
    of the rights of a holder with respect to, any Shares subject to
    such Stock Award unless and until such Participant has satisfied
    all requirements for exercise of the Stock Award pursuant to its
    terms.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(c)&#160;</B><I>No Employment or other Service
    Rights.</I>&#160;&#160;Nothing in the Plan or any instrument
    executed or any Stock Award granted pursuant thereto shall
    confer upon any Participant or other holder of Stock Awards any
    right to continue to serve the Company or an Affiliate in the
    capacity in effect at the time the Stock Award was granted or
    shall affect the right of the Company or an Affiliate to
    terminate (i)&#160;the employment of an Employee with or without
    notice and with or without cause, (ii)&#160;the service of a
    Consultant pursuant to the terms of such Consultant&#146;s
    agreement with the Company or an Affiliate or (iii)&#160;the
    service of a Director
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    B-7
</DIV><!-- END LOGICAL PAGE -->
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<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    pursuant to the Bylaws of the Company or an Affiliate, and any
    applicable provisions of the corporate law of the state in which
    the Company or the Affiliate is incorporated, as the case may be.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(d)&#160;</B><I>Investment Assurances.</I>&#160;&#160;The
    Company may require a Participant, as a condition of exercising
    or acquiring Shares under any Stock Award, (i)&#160;to give
    written assurances satisfactory to the Company as to the
    Participant&#146;s knowledge and experience in financial and
    business matters
    <FONT style="white-space: nowrap">and/or</FONT> to
    employ a purchaser representative reasonably satisfactory to the
    Company who is knowledgeable and experienced in financial and
    business matters and that he or she is capable of evaluating,
    alone or together with the purchaser representative, the merits
    and risks of exercising the Stock Award; and (ii)&#160;to give
    written assurances satisfactory to the Company stating that the
    Participant is acquiring the stock subject to the Stock Award
    for the Participant&#146;s own account and not with any present
    intention of selling or otherwise distributing the stock. The
    foregoing requirements, and any assurances given pursuant to
    such requirements, shall be inoperative if (iii)&#160;the
    issuance of the Shares upon the exercise or acquisition of stock
    under the Stock Award has been registered under a then currently
    effective registration statement under the Securities Act or
    (iv)&#160;as to any particular requirement, a determination is
    made by counsel for the Company that such requirement need not
    be met in the circumstances under the then applicable securities
    laws. The Company may, upon advice of counsel to the Company,
    place legends on stock certificates issued under the Plan as
    such counsel deems necessary or appropriate in order to comply
    with applicable securities laws, including, but not limited to,
    legends restricting the transfer of the stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(e)&#160;</B><I>Withholding Obligations.</I>&#160;&#160;To
    the extent provided by the terms of a Stock Award Agreement, the
    Participant may satisfy any federal, state or local tax
    withholding obligation relating to the exercise or acquisition
    of Shares under a Stock Award by any of the following means (in
    addition to the Company&#146;s right to withhold from any
    compensation paid to the Participant by the Company) or by a
    combination of such means: (i)&#160;tendering a cash payment;
    (ii)&#160;authorizing the Company to withhold Shares from the
    Shares otherwise issuable to the Participant as a result of the
    exercise or acquisition of stock under the Stock Award; or
    (iii)&#160;delivering to the Company owned and unencumbered
    Shares.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(f)&#160;</B><I>Stock Unit Repurchase
    Limitation.</I>&#160;&#160;The terms of any repurchase option
    for a Stock Unit shall be specified in the Stock Award Agreement
    and may be at the Fair Market Value of the stock subject to the
    Stock Award at the time of repurchase, at the original price or
    on such terms and conditions as the Board may determine (and as
    shall be reflected in the Stock Award Agreement); <I>provided
    however </I>that this Section&#160;10(f) shall in no way limit
    the Company&#146;s ability to adjust any Stock Award as provided
    under Section&#160;11 below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(g)&#160;</B><I>Cancellation and Re-Grant of
    Options.</I>&#160;&#160;The Company may not reprice any
    outstanding Stock Awards under the Plan, including implement any
    program whereby outstanding Stock Awards will be cancelled and
    replaced with Stock Awards bearing a lower purchase or exercise
    price, without first obtaining the approval of the shareholders
    of the Company; <I>provided however </I>that this
    Section&#160;10(g) shall in no way limit the Company&#146;s
    ability to adjust Stock Awards as provided under Section&#160;11
    below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(h)&#160;</B><I>Interpretation of Plan and Stock
    Awards.</I>&#160;&#160;In the event that any provision of the
    Plan or any Stock Award granted under the Plan is declared to be
    illegal, invalid or otherwise unenforceable by a court of
    competent jurisdiction, such provision shall be reformed, if
    possible, to the extent necessary to render it legal, valid and
    enforceable, or otherwise deleted, and the remainder of the
    terms of the Plan
    <FONT style="white-space: nowrap">and/or</FONT> Stock
    Award shall not be affected to the extent necessary to reform or
    delete such illegal, invalid or unenforceable provision. All
    questions arising under the Plan or under any Stock Award shall
    be decided by the Board or the Committee in its or their total
    and absolute discretion and such decisions shall be final and
    binding on all parties.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(i)&#160;</B><I>Electronic Communication.</I>&#160;&#160;Any
    document required to be delivered under the Plan, including
    under the Applicable Laws, may be delivered in writing or
    electronically. Signature may also be electronic if permitted by
    the Board or the Committee, and if permitted by Applicable Law.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(j)&#160;</B><I>Escrow of Shares.</I>&#160;&#160;To enforce
    any restriction applicable to Shares issued under the Plan, the
    Board or the Committee may require a Participant or other holder
    of such Shares to deposit the certificates representing such
    Shares, with approved stock powers or other transfer instruments
    endorsed in blank, with the
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    B-8
</DIV><!-- END LOGICAL PAGE -->
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Company or an agent of the Company until the restrictions have
    lapsed. Such certificates (or other notations representing the
    Shares) may bear a legend or legends referencing the applicable
    restrictions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    11.&#160;<FONT style="font-variant: SMALL-CAPS">Adjustments upon
    Changes in Stock.
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(a)&#160;</B><I>Capitalization Adjustments.</I>&#160;&#160;If
    any change is made in the stock subject to the Plan, or subject
    to any Stock Award, without the receipt of consideration by the
    Company (through merger, consolidation, reorganization,
    recapitalization, reincorporation, stock dividend, dividend in
    property other than cash, stock split, liquidating dividend,
    combination of shares, exchange of shares, change in corporate
    structure or other transaction not involving the receipt of
    consideration by the Company), the Plan will be appropriately
    adjusted in the class(es) and maximum number of securities
    subject to the Plan pursuant to subsection&#160;4(a) and the
    maximum number of securities subject to award to any person
    pursuant to subsection&#160;4(b), and the outstanding Stock
    Awards will be appropriately adjusted in the class(es) and
    number of securities and price per Share of stock subject to
    such outstanding Stock Awards. The Board, the determination of
    which shall be final, binding and conclusive, shall make such
    adjustments. (The conversion of any convertible securities of
    the Company shall not be treated as a transaction &#147;without
    receipt of consideration&#148; by the Company.)
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(b)&#160;</B><I>Change in Control&#160;&#151; Dissolution or
    Liquidation.</I>&#160;&#160;In the event of a dissolution or
    liquidation of the Company, then such Stock Awards shall be
    terminated if not exercised (if applicable) prior to such event.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(c)&#160;</B><I>Change in Control&#160;&#151; Asset Sale,
    Merger, Consolidation or Reverse Merger or Acquisition of
    Stock.</I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(i)&#160;</B>In the event of (1)&#160;a sale of substantially
    all of the assets of the Company, or (2)&#160;a merger or
    consolidation in which the Company is not the surviving
    corporation or (3)&#160;a reverse merger in which the Company is
    the surviving corporation but the shares of Common Stock
    outstanding immediately preceding the merger are converted by
    virtue of the merger into other property, whether in the form of
    securities, cash or otherwise, or (4)&#160;the direct or
    indirect acquisition (including by way of a tender or exchange
    offer) by any person, or persons acting as a group, of
    beneficial ownership or a right to acquire beneficial ownership
    of shares representing a majority of the voting power of the
    then outstanding shares of capital stock of the Company<B>,
    </B>then any surviving corporation or acquiring corporation
    shall assume any Stock Awards outstanding under the Plan or
    shall substitute similar awards (including with respect to a
    Stock Award an award to acquire the same consideration paid to
    the shareholders in the transaction described in this
    subsection&#160;11(c) for those outstanding under the Plan).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(ii)&#160;</B>For purposes of subsection&#160;11(c) a Stock
    Award shall be deemed assumed if, following the change in
    control, the Stock Award confers the right to purchase in
    accordance with its terms and conditions, for each share of
    Common Stock subject to the Stock Award immediately prior to the
    change in control, the consideration (whether stock, cash or
    other securities or property) to which a holder of a share of
    Common Stock on the effective date of the change in control was
    entitled.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(iii)&#160;</B>Subject to the provisions of any Stock Award
    Agreement, in the event any surviving corporation or acquiring
    corporation refuses to assume such Stock Awards or to substitute
    similar stock awards for those outstanding under the Plan, then
    with respect to Stock Awards held by Participants whose
    Continuous Service has not terminated, the vesting of 50% of
    such Stock Awards (and, if applicable, the time during which
    such Stock Awards may be exercised or settled) shall be
    accelerated in full, and the Stock Awards shall terminate if not
    exercised or settled (if applicable) at or prior to such event.
    With respect to any other Stock Awards outstanding under the
    Plan, such Stock Awards shall terminate if not exercised (if
    applicable) prior to such event.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(iv)&#160;</B>The Board shall at all times have the
    authority, in its sole discretion, to provide for additional or
    different vesting, exercisability, settlement or forfeiture
    conditions with respect to Stock Awards than that reflected in
    this Section&#160;11(c), <I>provided </I>that its determinations
    in this regard shall be reflected in the Stock Award Agreement
    (including in amendments thereto) issued to the affected
    Participant.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    12.&#160;<FONT style="font-variant: SMALL-CAPS">Amendment of the
    Plan and Stock Awards.
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(a)&#160;</B><I>Amendment of Plan.</I>&#160;&#160;The Board
    at any time, and from time to time, may amend the Plan. However,
    except as provided in Section&#160;11 relating to adjustments
    upon changes in stock, no amendment shall be
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    B-9
</DIV><!-- END LOGICAL PAGE -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN LOGICAL PAGE -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    effective unless approved by the shareholders of the Company to
    the extent shareholder approval is necessary to satisfy the
    requirements of
    <FONT style="white-space: nowrap">Rule&#160;16b-3</FONT>
    or any Nasdaq or securities exchange listing requirements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(b)&#160;</B><I>Shareholder Approval.</I>&#160;&#160;The
    Board may, in its sole discretion, submit any other amendment to
    the Plan for shareholder approval, including, but not limited
    to, amendments to the Plan intended to satisfy the requirements
    of Section&#160;162(m) of the Code and the regulations
    thereunder regarding the exclusion of performance-based
    compensation from the limit on corporate deductibility of
    compensation paid to certain executive officers.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(c)&#160;</B><I>Contemplated Amendments.</I>&#160;&#160;It is
    expressly contemplated that the Board may amend the Plan in any
    respect the Board deems necessary or advisable to provide
    eligible Employees with the maximum benefits provided or to be
    provided under the provisions of the Code or any other
    Applicable Law.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(d)&#160;</B><I>No Impairment of
    Rights.</I>&#160;&#160;Rights under any Stock Award granted
    before amendment of the Plan shall not be materially impaired by
    any amendment of the Plan unless (i)&#160;the Company requests
    the consent of the Participant and (ii)&#160;the Participant
    consents in writing.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(e)&#160;</B><I>Amendment of Stock Awards.</I>&#160;&#160;The
    Board at any time, and from time to time, may amend the terms of
    any one or more Stock Awards; provided, however, that the rights
    under any Stock Award shall not be materially impaired by any
    such amendment unless (i)&#160;the Company requests the consent
    of the Participant and (ii)&#160;the Participant consents in
    writing.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    13.&#160;<FONT style="font-variant: SMALL-CAPS">Termination or
    Suspension of the Plan.
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(a)&#160;</B><I>Plan Term.</I>&#160;&#160;The Board may
    suspend or terminate the Plan at any time. Unless sooner
    terminated, the Plan shall terminate on the day before the tenth
    (10th) anniversary of the date the Plan is adopted by the Board
    or approved by the shareholders of the Company, whichever is
    earlier. No Stock Awards may be granted under the Plan while the
    Plan is suspended or after it is terminated.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(b)&#160;</B><I>No Impairment of
    Rights.</I>&#160;&#160;Suspension or termination of the Plan
    shall not materially impair rights and obligations under any
    Stock Award granted while the Plan is in effect except with the
    written consent of the Participant.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    14.&#160;<FONT style="font-variant: SMALL-CAPS">Effective Date
    of Plan.
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Plan shall become effective as determined by the Board, but
    no Stock Award shall be exercised unless and until the Plan has
    been approved by the shareholders of the Company, which approval
    shall be within twelve (12)&#160;months before or after the date
    the Plan is adopted by the Board.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    15.&#160;<I><FONT style="font-variant: SMALL-CAPS">Governing
    Law. </FONT></I>All questions concerning the construction,
    validity and interpretation of this Plan shall be governed by
    the law of the State of Washington, without regard to such
    states conflict of laws rules.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    B-10
</DIV><!-- END LOGICAL PAGE -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>VOTE BY INTERNET&#151; www.proxyvote.com</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Use the Internet to transmit your voting instructions and for electronic delivery of information up
until 11:59&nbsp;P.M. Eastern Time on March&nbsp;21, 2007. Have your proxy card in hand when you access the
web site and follow the instructions to obtain your records and to create an electronic voting
instruction form.
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>VOTE BY PHONE &#150;1-800-690-6903</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Use any touch-tone telephone to transmit your voting instructions up until 11:59&nbsp;P.M. Eastern Time
on March&nbsp;21, 2007. Have your proxy card in hand when you call and then follow the instructions.
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>VOTE BY MAIL</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Mark, sign and date your proxy card and return it in the postage-paid envelope provided or return
to F5 Networks, Inc., c/o ADP, 51 Mercedes Way, Edgewood, New York 11717.
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">




<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>F5 NETWORKS, INC.</B><BR>
ANNUAL MEETING OF SHAREHOLDERS<BR>
March&nbsp;22, 2007
</DIV>


<DIV align="Center" style="font-size: 10pt; margin-top: 6pt">PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The undersigned hereby appoints Jeffrey A. Christianson, with full power of substitution, proxy to
vote at the Annual Meeting of Shareholders of F5 Networks, Inc. (the &#147;Company&#148;), to be held on
March&nbsp;22, 2007 at 10:00&nbsp;a.m., local time, at F5 Networks, Inc. Headquarters, 401 Elliott Avenue
West, Seattle, Washington 98119, and at any adjournment thereof, hereby revoking any proxies
heretofore given, to vote all shares of Common Stock of the Company, held or owned by the
undersigned, as directed on the reverse side of this proxy card, and
in his discretion upon such
other matters as may come before the meeting.
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt">(TO BE SIGNED ON REVERSE SIDE)
</DIV>




<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="50%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="45%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&#091;F5 LOGO&#093;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B>VOTE BY INTERNET&#151;<U>www.proxyvote.com</U></B></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><B>F5 NETWORKS, INC.<BR>
401 ELLIOTT AVENUE WEST<BR>
SEATTLE, WASHINGTON 98119</B><BR>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Use the Internet to transmit your voting
instructions and for electronic delivery of
information up until 11:59&nbsp;P.M. Eastern Time the
day before the cut-off date or meeting date.
Have your proxy card in hand when you access the
web site and follow the instructions to obtain
your records and to create an electronic voting
instruction form.</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B>ELECTRONIC DELIVERY OF FUTURE SHAREHOLDER COMMUNICATIONS</B></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">If you would like to reduce the costs incurred
by F5 Networks, Inc. in mailing proxy materials,
you can consent to receiving all future proxy
statements, proxy cards and annual reports
electronically via e-mail or the Internet. To
sign up for electronic delivery, please follow
the instructions above to vote using the
Internet and, when prompted, indicate that you
agree to receive or access shareholder
communications electronically in future years.</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B>VOTE BY PHONE&#151;1-800-690-6903</B></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Use any touch-tone telephone to transmit your
voting instructions up until 11:59&nbsp;P.M. Eastern
Time the day before the cut-off date or meeting
date. Have your proxy card in hand when you call
and then follow the instructions.</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B>VOTE BY MAIL</B></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Mark, sign, and date your proxy card and return
it in the postage-paid envelope we have provided
or return it to F5 Networks, Inc., c/o ADP, 51
Mercedes Way, Edgewood, New York 11717.</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="center">
<TABLE style="font-size: 7pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="55%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="9%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><FONT style="white-space: nowrap">TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:</FONT>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">F5NTK1
</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">KEEP THIS PORTION FOR YOUR RECORDS</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD colspan="5" valign="top" align="left" style="border-top: 1px solid #000000">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">DETACH AND RETURN THIS PORTION ONLY</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="center" style="font-size: 10pt"><B>THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.</B></DIV>



<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;F5 NETWORKS, INC.
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="46%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top" colspan="3"><DIV style="margin-left:0px; text-indent:-0px"><B>Election of Three Class&nbsp;II Directors</B>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">For All
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Withhold<BR>
All
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">For All<BR>
Except
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">To withhold
authority to vote
for any individual
nominee(s), mark
&#147;For All Except&#148;
and write the
number(s) of the
nominee(s) on the
line below.</TD>
</TR>
<TR valign="bottom">
    <TD colspan="3" valign="top" align="left">Nominees: Class&nbsp;II</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">1.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">01) Deborah L. Bevier
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><FONT face="Wingdings">&#111;</FONT>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><FONT face="Wingdings">&#111;</FONT>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><FONT face="Wingdings">&#111;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top" style="border-top: 1px solid #000000">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">02) Alan J. Higginson</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">03) John McAdam</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD colspan="3" valign="top" align="left"><B>The Board of Directors recommends a vote &#147;<U>FOR</U>&#148; all nominees</B></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD colspan="3" valign="top" align="left"><B>Vote On Proposals</B></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">For</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Against</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Abstain</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">2.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Proposal to Approve an Amendment to 2005 Equity Incentive
Plan
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><FONT face="Wingdings">&#111;</FONT>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><FONT face="Wingdings">&#111;</FONT>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><FONT face="Wingdings">&#111;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD colspan="3" valign="top" align="left"><B>The Board of Directors recommends a vote &#147;<U>FOR</U>&#148; Proposal 2</B></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">For
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Against
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Abstain</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">3.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Proposal to Ratify Selection of
PricewaterhouseCoopers LLP as the Company&#146;s independent
auditor for fiscal year 2007.
</TD>

    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><FONT face="Wingdings">&#111;</FONT>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><FONT face="Wingdings">&#111;</FONT>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><FONT face="Wingdings">&#111;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD colspan="3" valign="top" align="left"><B>The Board of Directors recommends a vote &#147;<U>FOR</U>&#148; Proposal 3</B></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
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    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">For
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Against
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Abstain</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">4.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Shareholder Proposal Regarding Executive Compensation
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><FONT face="Wingdings">&#111;</FONT>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><FONT face="Wingdings">&#111;</FONT>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><FONT face="Wingdings">&#111;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD colspan="3" valign="top" align="left"><B>The Board of Directors recommends a vote &#147;<U>AGAINST</U>&#148; Proposal 4</B></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="40%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="45%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">This proxy is revocable and when properly
executed, will be voted in the manner directed by the
undersigned shareholder. UNLESS CONTRARY DIRECTION IS
GIVEN, THIS PROXY WILL BE VOTED &#147;FOR&#148; PROPOSALS 1, 2 AND
3 AND &#147;AGAINST&#148; PROPOSAL 4.</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">NOTE: Please sign exactly as name(s) appear(s) hereon.
When signing in a representative capacity, please give
title.</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><u><B>HOUSEHOLDING ELECTION</B></u> &#150; Please indicate if you consent
to receive certain future investor communications in a
single package per household
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Yes<BR>
<FONT face="Wingdings">&#111;</FONT>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">No<BR>
<FONT face="Wingdings">&#111;</FONT>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="40%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
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    <TD width="3%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
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<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
Signature ( PLEASE SIGN WITHIN BOX )
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
Date
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
Signature (Joint Owners)
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
Date
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<!-- End Table Body -->
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<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
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