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CITRIX SYSTEMS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
F-19
acquisitions were approximately $0.4 million, all of which the Company expensed during the year ended December 31, 2012
and are included in General and administrative expense in the accompanying consolidated statements of income. In addition, in
connection with the acquisitions, the Company assumed non-vested stock units which were converted into the right to receive,
in the aggregate, up to 66,459 shares of the Company's common stock, for which the vesting period reset fully upon the closing
of each respective transaction.
During the third quarter of 2012, the Company acquired all of the issued and outstanding securities of two privately-held
companies for a total cash consideration of approximately $5.3 million. One of the businesses became part of the Company's
Enterprise and Service Provider division and the other became part of the Company's SaaS division. Transaction costs
associated with the acquisitions were approximately $0.2 million, all of which the Company expensed during the year ended
December 31, 2012 and are included in General and administrative expense in the accompanying consolidated statements of
income. In addition, in connection with the acquisitions, the Company assumed non-vested stock units which were converted
into the right to receive, in the aggregate, up to 13,487 shares of the Company's common stock, for which the vesting period
reset fully upon the closing of each respective transaction.
Subsequent Events
On January 8, 2014, the Company acquired all of the issued and outstanding securities of Framehawk, Inc.
("Framehawk"). The Framehawk solution, which optimizes the delivery of virtual desktops and applications to mobile devices,
will be combined with HDX technology in the Citrix XenApp and XenDesktop products to deliver an unparalleled user
experience under adverse network conditions. The total preliminary consideration for this transaction was approximately $27.9
million, net of $0.3 million of cash acquired, and was paid in cash. Transaction costs associated with the acquisition are
currently estimated at $0.1 million, all of which the Company expensed during the year ended December 31, 2013 and are
included in General and administrative expense in the accompanying consolidated statements of income.
4. INVESTMENTS
Available-for-sale Investments
Investments in available-for-sale securities at fair value were as follows for the periods ended (in thousands):
December 31, 2013 December 31, 2012
Description of the Securities
Amortized
Cost
Gross
Unrealized
Gains
Gross
Unrealized
Losses Fair Value
Amortized
Cost
Gross
Unrealized
Gains
Gross
Unrealized
Losses Fair Value
Agency securities $ 453,922 $ 1,177 $ (349) $ 454,750 $ 400,365 $ 2,347 $ (5) $ 402,707
Corporate securities 643,360 947 (216) 644,091 404,546 947 (171) 405,322
Municipal securities 53,698 81 (23) 53,756 32,214 114 (15) 32,313
Government securities 156,930 196 (47) 157,079 39,863 131 (1) 39,993
Total $1,307,910 $ 2,401 $ (635) $1,309,676 $ 876,988 $ 3,539 $ (192) $ 880,335
The change in net unrealized gains (losses) on available-for-sale securities recorded in Other comprehensive income
(loss) includes unrealized gains (losses) that arose from changes in market value of specifically identified securities that were
held during the period, gains (losses) that were previously unrealized, but have been recognized in current period net income
due to sales, as well as prepayments of available-for-sale investments purchased at a premium. This reclassification has no
effect on total comprehensive income or equity and was not material for all periods presented. See Note 14 for more
information related to comprehensive income.
The average remaining maturities of the Company’s short-term and long-term available-for-sale investments at
December 31, 2013 were approximately five months and three years, respectively.
Realized Gains and Losses on Available-for-sale Investments
For the years ended December 31, 2013 and 2012, the Company had realized gains on the sales of available-for-sale
investments of $3.0 million and $4.1 million, respectively. For the years ended December 31, 2013 and 2012, the Company had
realized losses on available-for-sale investments of $2.7 million and $0.8 million, respectively, primarily related to
prepayments at par of securities purchased at a premium. All realized gains and losses related to the sales of available-for-sale
investments are included in Other (expense) income, net, in the accompanying consolidated statements of income.
The Company continues to monitor its overall investment portfolio and if the credit ratings of the issuers of its
investments deteriorate or if the issuers experience financial difficulty, including bankruptcy, the Company may be required to