1. a l a d d i n. c o m Aladdin Distributor Conference Laila Arad-Allan VP Software DRM September 12, 2008

2. a l a d d i n. c o m 2 © Copyright 2008 Aladdin Knowledge Systems Ltd. All rights reserved. Aladdin, Aladdin Knowledge Systems, HASP ®, eToken TM and eSafe ® are only a few of Aladdin Knowledge Systems Ltd.’s (“Aladdin”) proprietary trademarks. The Aladdin Knowledge Systems logo is also proprietary to Aladdin. The information contained in this presentation is protected by international copyright laws. The copyrights are owned by Aladdin or the original creator of the material. The information contained herein is provided to you for informational purposes only, and except and to the extent specifically permitted, no portion of this presentation may be copied, reproduced (or the like), distributed or used in any way whatsoever whether directly or indirectly. In addition to Aladdin’s trademarks, logos, content and information, this presentation may contain references to trademarks and/or logos owned by other entities. Aladdin expressly disclaims any proprietary interest in trademarks and/or logos owned by other entities and makes no representation of any association, sponsorship, affiliation, or endorsement with or by the owners of such trademarks and/or logos. This presentation may contain references and use of third party web sites for purposes of providing examples relevant to this course. Aladdin assumes no responsibility and/or liability for any content and/or information contained in such third party web sites. Aladdin further does not endorse the companies or contents of any referenced sites. Aladdin does not assume any responsibility or liability for the accuracy of the information contained in this presentation. The information contained in this presentation is provided "as is" and does not constitute a warranty of any kind, either express or implied. Aladdin disclaims all warranties, expressed or implied, including but not limited to implied warranties of merchantability, fitness for a particular purpose, and non-infringement. a l a d d i n. c o m Legal Notice

3. a l a d d i n. c o m 3 Agenda Background The Challenges The Distributor Conference The Event Sessions The Results

4. a l a d d i n. c o m 4 About Aladdin Headquarters: Tel Aviv, Israel Global Presence: Strong Financial Momentum: Founded: 1985, publicly traded since 1993 Employees Worldwide: 465 2007 revenues: $105.9M (+19%) 2007 profits: $17.6M (Non-GAAP) World Renowned Products: Global leader in Software DRM (Digital Rights Management), fast growth, innovative Enterprise Security products Offices in USA, UK, Germany, France, The Netherlands, India, Spain, Italy, Japan and China. 30 Distributors worldwide

5. a l a d d i n. c o m 5 About HASP SRM A software protection and licensing system; innovative! We are a market leader: 42%; +2% annually We won 3 important awards We target software publishers and system vendors We offer flexible tools for increasing business and optimizing the protection and licensing lifecycle

6. a l a d d i n. c o m 6 About Aladdin’s Sales Channel Sales offices in 10 countries –Direct sales –Sales offices are part of the Aladdin global organization –Our business unit works closely with them on a daily basis Around 30 distributors in countries without an office –Some of them have been with us for over 2 decades –Highly dedicated and professional –Some are mom and pop shops –Others are big organizations with small HASP sales teams –We hold quarterly product webinars –Traditionally we hold a distributor conference every 1.5 to 2 years

7. a l a d d i n. c o m 7 What Happened 1.5 Years Ago Software protection and licensing needs have changed We released HASP SRM – our new generation solution Ground-breaking technology No longer just a dongle No longer an off-the-shelf product We no longer target just software developers Expanded target market: new segments, new players, broader audience Solution became more complex in features and in sales cycle New positioning, new messages to the market More complex business and pricing model

8. a l a d d i n. c o m 8 The Challenges: Our Distributors Doubt and uncertainty about the new HASP SRM solution Still selling the old generation HASP: bad for Aladdin and the customers Do not know how to target the new market segments; Do not understand the new positioning and messages (e.g. homegrown) Had to switch from selling a boxed product to selling value; not realizing the value Had to switch from a very simple business model to a more complex Bottom line: they couldn’t and weren’t selling HASP SRM

9. a l a d d i n. c o m 9 Distributor Conference January 2008 Luke Hohmann – Enthiosys CEO - was the event facilitator All sessions were planned with Luke Hohmann and Don Gray from Sales Engineering Group Frontal presentations; group activities; innovation games; case studies The Goals: –Gain confidence in HASP SRM –Realize the huge potential of HASP SRM –Learn how to sell the value –Learn how to target and sell into new markets

10. a l a d d i n. c o m 10 Distributor Conference: The Sessions Customer Centric Selling –Different customers perceive value differently; different roles in a customer organization perceive value differently –How HASP SRM provides value to different customers and roles –Case Studies: Aladdin sales reps presenting how they sold the value Aladdin HASP SRM customers presenting how they perceived the value Activity: identifying the key elements for success based on the presented case studies –Spider Web Innovation Games® – analyzing and discussing the case studies, identifying who was in the sales process on both sides; who values the solution

11. a l a d d i n. c o m 11 Distributor Conference: The Sessions Customer Centric Selling –Strategies and tools for customer centric selling Solution development prompter booklet: asking the right questions; offering the right solution Opportunity assessment tactics –Choosing the opportunities to pursue –Managing the risk in each opportunity –Assessing the unknowns –Activity: score-based opportunity assessment

12. a l a d d i n. c o m 12 Distributor Conference: The Sessions Product Box – Innovation Games® –Half day session in work groups –Each team chose a target customer and had to build a product box that communicated the value –Discussion between team members as they were working demonstrated that they absorbed and digested a lot during the previous day

13. a l a d d i n. c o m 13 Distributor Conference: The Sessions Remember the Future – Innovation Games® –Distributors were asked to imagine it is one year later (January 2009) –They were at a party celebrating hitting their goal of a 20% increase in HASP SRM sales –They were asked to list what they will have done to enable their success and what Aladdin will have done to help them –Each distributor then had to present his/her future

14. a l a d d i n. c o m 14 The Results Event was a great success We’re following up on each distributor as per their “Remember the Future” commitments Most distributors have already held local HASP SRM events Their marketing materials are in line with our positioning and messaging We see an increase in HASP SRM sales among our distributors We get feedback from them which helps us tailor our messaging and pricing model Aladdin is holding follow-up local events with some of the distributors to further strengthen their sales capabilities

15. a l a d d i n. c o m Thank You