Mark B. Templeton has served as President of the Company since January 1998 and as Chief Executive Officer from June 2001 to the present. He was elected to the Board of Directors in May 1998. Mr. Templeton is a member of the Board of Directors of Equifax, Inc., a publicly-traded credit reporting company. The Board of Directors believes Mr. Templeton’s qualifications to sit on the Company’s Board of Directors include his decades of experience in the software industry, including 12 years as President and/or Chief Executive Officer of the Company, and his deep understanding of the

Company’s historical and current business strategies, objectives and products.

Brett M. Caine has served as Senior Vice President, Online Services Division since October 2007. From July 2005 to October 2007, Mr. Caine served as Group Vice President of the Online Group. From August 2004 to July 2005, Mr. Caine served as President, Citrix Online. From March 2004 to August 2004, Mr. Caine served as Vice President, Worldwide Sales, Citrix Online.

David R. Friedman has served as General Counsel and Senior Vice President, Human Resources of the Company since April 2006 and also served as Secretary from October 2002 to February 2008. From October 2002 to April 2006, Mr. Friedman served as General Counsel, Corporate Vice President and Secretary.

David J. Henshall has served as Senior Vice President and Chief Financial Officer of the Company since January 2006. From April 2003 to January 2006, Mr. Henshall served as Vice President and Chief Financial Officer of the Company.

Peter Levine has served as Senior Vice President of the Company’s Datacenter & Cloud Division since October 2007. Prior to joining the Company, Mr. Levine served as President and Chief Executive Officer of XenSource, Inc., a privately-held software business acquired by the Company in 2007. From June 2002 to February 2005, Mr. Levine served as Managing Director of Mayfield Fund, a venture capital investment firm.

Alvaro J. Monserrat has served as Senior Vice President, Sales and Services of the Company since July 2008. From July 2007 to July 2008, Mr. Monserrat served as the Company’s Vice President of Channels and Emerging Products. Mr. Monserrat also served as Vice President of North America Sales from October 2003 to July 2007, as Vice President of Field Services from March 2002 to October 2003, as Vice President of Consulting Services from December 2001 to March 2002, and as Director of Consulting Services from February 2000 to December 2001.

John Gordon Payne has served as Senior Vice President and General Manager of the Company’s Desktop Division since August 2007. From January 2007 to August 2007, Mr. Payne served as Group Vice President and General Manager of the Company’s Advanced Solutions Group. Mr. Payne also served as Product Line Executive, Emerging Products of the Company’s Virtual Systems Group from April 2006 to December 2006, and as Vice President of Marketing for the Company’s Advanced Solutions Group from December 2004 to December 2006. From January 2000 to December 2004, Mr. Payne served as the Chief Marketing Officer and Chief Financial Officer of Net6, Inc., a privately-held software company acquired by the Company in 2004.

Wesley R. Wasson has served as Senior Vice President and Chief Marketing Officer since October 2007. From September 2006 to October 2007, he served as the Company’s Corporate Vice President, Worldwide Marketing. From August 2005 to September 2006, Mr. Wasson served as the Vice President of the Company’s Application Networking Group. Prior to joining the Company, Mr. Wasson served as Vice President of Worldwide Marketing at NetScaler, Inc., a privately-held software company acquired by the Company in 2005. From August 2002 to December 2004, Mr. Wasson served as the Chief Strategy Officer of NetContinuum, an application security company based in Silicon Valley.

Thomas F. Bogan has served as a director of the Company since January 2003 and as Chairperson of the Board of Directors since May 2005. Since January 2010, Mr. Bogan has been a Venture Partner at Greylock Partners, a venture capital firm. From May 2004 to December 2009, Mr. Bogan was a Partner at Greylock Partners. Prior to serving at Greylock, Mr. Bogan was President of Rational Software, an S&P 500 enterprise software company, from 2000 until its sale to IBM in 2003. He previously had served Rational as its Chief Operating Officer and as General Manager of its testing business from 1996 to 2000. Prior to working at Rational, Mr. Bogan was President and Chief Executive Officer of two early stage technology companies that focused on networking and peripheral products. Mr. Bogan’s earlier background was in finance, and he served as a financial officer in public and private companies as well as positions in public accounting. The Board of Directors believes Mr. Bogan’s qualifications to sit on the Company’s Board of Directors include his decades of senior management experience in the software industry, both as a CEO and a venture capital investor, during which time he has gained significant strategic, operational and corporate governance expertise.

Nanci Caldwell has served as a director of the Company since July 2008. Since 2005, Ms. Caldwell has served as a member of a number of Boards of technology companies and currently serves on the Board of Directors of Deltek, Inc., a publicly-traded enterprise management software company, and Tibco Software Inc., a publicly-traded leading business integration and process management software company. During 2005 and 2006, Ms. Caldwell

worked as a project-based technology consultant. From April 2001 to December 2004, Ms. Caldwell was Executive Vice President and CMO for PeopleSoft, Inc., a publicly-held human resource management software company, until it was acquired by Oracle Corporation, or Oracle, a publicly-traded software company, in December 2004. Ms. Caldwell also served as a member of the Board of Directors of Network General, now NetScout Inc., a publicly-traded provider of integrated network performance management solutions, from 2005 to 2007 and Hyperion, Inc., a provider of performance management software acquired by Oracle in 2007, from 2006 to 2007. The Board of Directors believes Ms. Caldwell’s qualifications to sit on the Company’s Board of Directors include her extensive experience with technology and software companies, including in the areas of sales and marketing, as well as her executive leadership and management expertise.

Murray J. Demo has served as a director of the Company since February 2005. Mr. Demo is currently Executive Vice President and Chief Financial Officer of Dolby Laboratories, a publicly- traded global leader in entertainment technologies. From September 2007 to June 2008, Mr. Demo served as Executive Vice President and Chief Financial Officer of LiveOps, a privately-held virtual call center company. Mr. Demo served as Executive Vice President and Chief Financial Officer of Postini, Inc., a security software company, from May 2007 until it was acquired by Google Inc. in September 2007. Mr. Demo served as Executive Vice President and Chief Financial Officer from April 2005 to May 2006, Senior Vice President and Chief Financial Officer from June 2000 to April 2005, Vice President and Corporate Controller from October 1999 to June 2000, Corporate Controller from July 1998 to October 1999, Sr. Director of Finance, Product Divisions from February 1998 to July 1998 and Director of Operations Finance from August 1996 to February 1998 for Adobe Systems Incorporated, a computer software company. The Board believes Mr. Demo’s qualifications to sit on the Company’s Board of Directors include his extensive experience with finance and accounting matters for global organizations in the technology industry, including the experience that he has gained in his roles as Chief Financial Officer of publicly-traded companies.

Stephen M. Dow has served as a director of the Company since July 1989 and served as Chairperson of the Board of Directors from May 2002 to May 2005. Since 1983, Mr. Dow has served as a general partner of Sevin Rosen Funds, a venture capital investment firm. Mr. Dow serves on the Board of Directors of Cytokinetics, Inc., a publicly-traded biopharmaceutical company. The Board of Directors believes Mr. Dow’s qualifications to sit on the Company’s Board of Directors include his experience in leading a venture capital investment firm, during which time he has gained significant expertise in evaluating investment opportunities and overseeing management development and operations of portfolio companies, as well as the deep understanding of the Company’s organization and products that he has acquired during his over 20 years of service on the Board of Directors.

Asiff S. Hirji has served as a director of the Company since May 2006. Since April 2007, Mr. Hirji has served as a Partner of TPG Capital, L.P., a global private investment firm. From October 2006 to April 2007, Mr. Hirji served as the President, Client Group, of TD Ameritrade Holding Company, a publicly-traded provider of securities brokerage services. Mr. Hirji served as Chief Operating Officer of TD Ameritrade from July 2005 until October 2006 and as Chief Information Officer of Ameritrade from April 2003 until July 2005. The Board of Directors believes Mr. Hirji’s qualifications to sit on the Company’s Board of Directors include his extensive experience with global companies, his financial and investment expertise, and his years of experience providing strategic advice to complex organizations.

Gary E. Morin has served as a director of the Company since January 2003. From September 2005 until March 2006, Mr. Morin served as Executive Vice President of Lexmark International, Inc., a publicly-traded laser and inkjet printer and supplies company. From 2000 until September 2005, Mr. Morin served as Executive Vice President and Chief Financial Officer of Lexmark. Mr. Morin serves as a director of Sealy Corp., a publicly-traded bedding manufacturer, and of infoGROUP, Inc., a publicly-traded compiler of proprietary databases. The Board of Directors believes Mr. Morin’s qualifications to sit on the Company’s Board of Directors include his years of executive experience at publicly-traded companies, as well as his financial expertise.

Godfrey R. Sullivan has served as a director of the Company since February 2005. Mr. Sullivan is the President and Chief Executive Officer of Splunk, Inc., a privately-held information technology search software company. Prior to Splunk, Mr. Sullivan worked for Hyperion Solutions Corporation, a publicly-traded software company, where he served as President and Chief Operating Officer from 2001 through 2004 and as President and Chief Executive Officer from July 2004 until its acquisition by Oracle in April 2007. Mr. Sullivan serves on the Board of

Directors of Informatica Corporation, a publicly-traded data integration company. The Board of Directors believes Mr. Sullivan’s qualifications to sit on the Company’s Board of Directors include his decades of executive and operational experience, including as a CEO, with technology and software companies.

Executive officers of the Company are elected by the Board of Directors on an annual basis and serve until their successors have been duly elected and qualified.

Independence of Members of the Board of Directors

The Board of Directors has determined that each of the Company’s non-employee directors (Messrs. Bogan, Demo, Dow, Hirji, Morin and Sullivan, and Ms. Caldwell) is independent within the meaning of the director independence standards of The Nasdaq Stock Market LLC (“Nasdaq”) and the Securities and Exchange Commission (“SEC”), including Rule 10A-3(b)(1) under the Exchange Act. Furthermore, the Board of Directors has determined that each member of each of the committees of the Board of Directors is independent within the meaning of Nasdaq’s and the SEC’s director independence standards. In making this determination, the Board of Directors solicited information from each of the Company’s directors regarding whether such director, or any member of his or her immediate family, had a direct or indirect material interest in any transactions involving the Company, was involved in a debt relationship with the Company or received personal benefits outside the scope of such person’s normal compensation. The Board of Directors considered the responses of the Company’s directors, and independently considered the commercial agreements, acquisitions, and other material transactions entered into by the Company during 2009.

Board Leadership Structure

The Company’s Corporate Governance Guidelines provide the Board of Directors with flexibility to select the appropriate leadership structure at a particular time based on the specific needs of the Company’s business and what is in the best interests of the Company’s stockholders. The Company’s Corporate Governance Guidelines provide that the general policy of the Board of Directors is that the positions of Chairperson of the Board of Directors and Chief Executive Officer, or CEO, will be held by different persons. In certain circumstances, however, the Board of Directors may determine that it is in the best interests of the Company for the same person to hold the positions of Chairperson and CEO. In such event, the Board of Directors will appoint an independent member of the Board of Directors as the Lead Independent Director. The Board of Director’s general policy is that the position of Chairperson or Lead Independent Director, as the case may be, will be held by an independent member of the Board of

Directors. The Chairperson will preside at executive sessions of the independent directors and will bear such further responsibilities as the full Board of Directors may designate from time to time.

The Company has currently separated the roles of Chairperson and CEO. The Board of Directors believes that this leadership structure is appropriate for the Company at the current time, as it provides an appropriate balance between the two roles. The CEO is responsible for setting the strategic direction for the Company and the day-to-day leadership and performance of the Company, while the Chairperson of the Board of Directors provides guidance to the CEO and sets the agenda for Board of Director meetings and presides over meetings of the full Board of Directors. Thus, the Board of Directors believes that the current structure balances the needs for the CEO to run the Company on a day-to-day basis with the benefit provided to the Company by significant involvement of an independent member of the Board of Directors.

Executive Sessions of Independent Directors

Executive sessions of the independent directors are held at least four times a year following regularly scheduled in-person meetings of the Board of Directors. Executive sessions do not include the employee director of the Company, and the Chairperson of the Board of Directors is responsible for chairing the executive sessions.

Considerations Governing Director Nominations

Director Qualifications

The Nominating and Corporate Governance Committee of the Board of Directors is responsible for reviewing with the Board of Directors from time to time the appropriate qualities, skills and characteristics desired of members of the Board of Directors in the context of the needs of the business and current make-up of the Board of Directors. This assessment includes consideration of the following minimum qualifications that the Nominating and Corporate Governance Committee believes must be met by all directors:

The Nominating and Corporate Governance Committee also may consider numerous other qualities, skills and characteristics when evaluating director nominees, such as:

Neither the Nominating and Corporate Governance Committee nor the Board of Directors has a specific policy with regard to the consideration of diversity in identifying director nominees. However, both may consider the diversity of background and experience of a director nominee in the context of the overall composition of the Board of Directors at that time, such as diversity of knowledge, skills, experience, geographic location, age, gender, and ethnicity. In general, the Nominating and Corporate Governance Committee seeks director nominees with the talents

and backgrounds that provide the Board of Directors with an appropriate mix of knowledge, skills and experience for the needs of the Company’s business. The Nominating and Corporate Governance Committee and the Board of Directors discuss the composition of directors on the Board, including diversity of background and experience, as part of the annual Board evaluation process.

Process for Identifying and Evaluating Director Nominees

The Board of Directors is responsible for selecting its own members. The Board of Directors delegates the selection and nomination process to the Nominating and Corporate Governance Committee, with the expectation that other members of the Board of Directors, and of management, will be requested to take part in the process as appropriate.

Generally, the Nominating and Corporate Governance Committee identifies candidates for director nominees in consultation with management, through the use of search firms or other advisors, through the recommendations submitted by stockholders or through such other methods as the Nominating and Corporate Governance Committee deems to be helpful to identify candidates. Once candidates have been identified, the Nominating and Corporate Governance Committee confirms that the candidates meet all of the minimum qualifications for director nominees established by the Nominating and Corporate Governance Committee. The Nominating and Corporate Governance Committee may gather information about the candidates through interviews, detailed questionnaires, comprehensive background checks or any other means that the Nominating and Corporate Governance Committee deems to be helpful in the evaluation process. The Nominating and Corporate Governance Committee then meets as a group to discuss and evaluate the qualities and skills of each candidate, both on an individual basis and taking into account the overall composition and needs of the Board of Directors. Based on the results of the evaluation process, the Nominating and Corporate Governance Committee recommends candidates for the Board of Directors’ approval as director nominees for election to the Board of Directors. The Nominating and Corporate Governance Committee also recommends candidates to the Board of Directors for appointment to the committees of the Board of Directors.

Procedures for Recommendation of Director Nominees by Stockholders

The Nominating and Corporate Governance Committee will consider director nominee candidates who are recommended by stockholders of the Company. Stockholders, in submitting recommendations to the Nominating and Corporate Governance Committee for director nominee candidates, shall follow the following procedures:

Generally, the Nominating and Corporate Governance Committee must receive any such recommendation for nomination not later than the close of business on the 120th day nor earlier than the close of business on the 150th day prior to the first anniversary of the date the proxy statement was delivered to stockholders in connection with the preceding year’s annual meeting.

All recommendations for nomination must be in writing and include the following:

Nominations must be sent to the attention of the Secretary of the Company by one of the two methods listed below:

By U.S. mail (including courier or expedited delivery service) to:

Citrix Systems, Inc.

851 West Cypress Creek Road

Fort Lauderdale, FL 33309

Attn: Secretary of Citrix Systems, Inc.

By facsimile to: (954) 267-2862

Attn: Secretary of Citrix Systems, Inc.

The Secretary of the Company will promptly forward any such nominations to the Nominating and Corporate Governance Committee. As a requirement to being considered for nomination to the Company’s Board of Directors, a candidate will need to comply with the following minimum procedural requirements:

Once the Nominating and Corporate Governance Committee receives the nomination of a candidate and the candidate has complied with the minimum procedural requirements above, such candidacy will be evaluated and a recommendation with respect to such candidate will be delivered to the Board of Directors.

Policy Governing Security Holder Communications with the Board of Directors

The Board of Directors provides to every security holder the ability to communicate with the Board of Directors as a whole and with individual directors on the Board of Directors through an established process for security holder communication as follows:

For communications directed to the Board of Directors as a whole, security holders may send such communications to the attention of the Chairperson of the Board of Directors by one of the two methods listed below:

By U.S. mail (including courier or expedited delivery service) to:

Citrix Systems, Inc.

851 West Cypress Creek Road

Fort Lauderdale, FL 33309

Attn: Chairperson of the Board of Directors,

c/o Secretary

By facsimile to: (954) 267-2862

Attn: Chairperson of the Board of Directors, c/o Secretary

For security holder communications directed to an individual director in his or her capacity as a member of the Board of Directors, security holders may send such communications to the attention of the individual director by one of the two methods listed below:

By U.S. mail (including courier or expedited delivery service) to:

Citrix Systems, Inc.

851 West Cypress Creek Road

Fort Lauderdale, FL 33309

Attn: [Name of the director], c/o Secretary

By facsimile to (954) 267-2862

Attn: [Name of the director], c/o Secretary

The Company will forward any such security holder communication to the Chairperson of the Board of Directors, as a representative of the Board of Directors, or to the director to whom the communication is addressed, on a periodic basis. The

Company will forward such communications by certified U.S. mail to an address specified by each director and the Chairperson of the Board of Directors for such purposes or by secure electronic transmission.

Policy Governing Director Attendance at Annual Meetings of Stockholders

The Company conducts an Annual Meeting of Stockholders, and all Directors are offered the opportunity to attend at the Company’s expense. Six members of the Board of Directors attended the Annual Meeting of Stockholders held in 2009.

Board of Directors Evaluation Program and Succession Planning

The Board of Directors annually undertakes a formal evaluation process consisting of an overall Board of Directors evaluation, committee evaluations, and peer and self evaluations by each member. As part of the evaluation process, the Board of Directors evaluates six different competencies: Board structure, Board roles, Board processes, Board composition, orientation and development, Board dynamics, and Board effectiveness. The evaluation process also includes consideration of the appropriate Board size, committee composition, appointment of Chairmanships, succession planning and the technical, business and organizational skills required of future Board members.

Code of Ethics

The Company has adopted a “code of ethics,” as defined by regulations promulgated under the Securities Act of 1933, as amended (the “Securities Act”), and the Exchange Act, that applies to all of the Company’s directors and employees worldwide, including its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. A current copy of the Code of Business Conduct is available in the Corporate Governance section of the Company’s website at http://www.citrix.com/site/aboutCitrix/governance/. A copy of the Code of Business Conduct may also be obtained, free of charge, from the Company upon a request directed to: Citrix Systems, Inc., 851 West Cypress Creek Road, Fort Lauderdale, Florida 33309, Attention: Investor Relations. The Company intends to disclose any amendment to or waiver of a provision of the Code of Business Conduct that applies to

its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, by posting such information on its website available at http://www.citrix.com/site/aboutCitrix/governance/.

For more corporate governance information, you are invited to access the Corporate Governance section of the Company’s website available at http://www.citrix.com/site/aboutCitrix/governance/.

Except for the availability of this Proxy Statement and the Annual Report to Stockholders, which are available for viewing, printing and downloading at www.citrix.com/annualreport, the information on the Company’s website is not part of this Proxy Statement.

Risk Oversight

Assessing and managing risk is the responsibility of Citrix’s management. The Board of Directors oversees and reviews certain aspects of the Company’s risk management efforts. The Board of Directors is involved in risk oversight through direct decision-making authority with respect to significant matters and the oversight of management by the Board of Directors and its committees. Among other areas, the Board is directly involved in overseeing risks related to the Company’s overall strategy, including product, go-to-market and sales strategy, executive officer succession, business continuity, crisis preparedness and corporate reputational risks.

The committees of the Board execute their oversight responsibility for risk management as follows:

Compensation Related Risk Assessment

We believe that the Company’s executive and employee compensation plans are appropriately structured so as not to incent excessive risk taking and are not reasonably likely to have a material adverse effect on the Company. In particular, the Compensation Committee considered the following elements of the Company’s compensation plans and policies when evaluating whether our plans and policies encourage our executives and employees to take unreasonable risks:

Board of Directors

The Board of Directors met nine times during the year ended December 31, 2009 and acted by written consent on three occasions. Each of the directors attended at least 75% of the aggregate of the total number of meetings of the Board of Directors and the total number of meetings of all committees of the Board of Directors on which he or she served during fiscal 2009. The Board of Directors has standing Audit, Compensation, Finance, Nominating and Corporate Governance and Strategy committees. Each committee has a written charter that has been approved by the Board of Directors. Each committee reviews the appropriateness of its charter at least annually.

Audit Committee

The Audit Committee of the Board of Directors currently consists of Messrs. Demo (Chair), Dow, Hirji and Sullivan, each of whom served on the Audit Committee after June 2009. Prior to June 2009, the Audit Committee consisted of Messrs. Demo, Hirji and Morin. The Board of Directors has determined that each member of the Audit Committee meets the independence requirements promulgated by Nasdaq and the SEC, including Rule 10A-3(b)(1) under the Exchange Act. In addition, the Board of Directors has determined that each member of the Audit Committee is financially literate and that each of Messrs. Demo, Dow, Hirji and Sullivan qualifies as an “audit committee financial expert” under the rules of the SEC. Stockholders should understand that this designation is a disclosure requirement of the SEC related to Messrs. Demo’s, Dow’s, Hirji’s and Sullivan’s experience and understanding with respect to certain accounting and auditing matters. The designation does not impose upon Messrs. Demo, Dow, Hirji and Sullivan any duties, obligations or liability that are greater than are generally imposed on them as members of the Audit Committee and the Board of Directors, and their designation as audit committee financial experts pursuant to this SEC requirement does not affect the duties, obligations or liability of any other member of the Audit Committee or the Board of Directors.

The Audit Committee met eleven times during the year ended December 31, 2009. The Audit Committee operates under a written charter adopted

by the Board of Directors, a current copy of which is available in the Corporate Governance section of the Company’s website at

http://www.citrix.com/site/aboutCitrix/governance/.

As described more fully in its charter, the Audit Committee oversees the Company’s accounting and financial reporting processes, internal controls and audit functions. In fulfilling its role, the Audit Committee:

Finance Committee

The Finance Committee of the Board of Directors currently consists of Messrs. Demo (Chair), Dow, Hirji and Sullivan, each of whom served on both the Finance Committee and the Audit Committee after June 2009. Prior to June 2009, the Finance Committee consisted of Messrs. Demo, Hirji and Morin. The Finance Committee advises the Board of Directors and, in certain instances, acts on behalf of the Board of Directors, on matters relating to the Company’s investment policies, financing activities and world-wide insurance programs.

The Board of Directors has determined that each member of the Finance Committee meets the independence requirements promulgated by Nasdaq. Because the members of the Finance Committee serve on the Audit Committee, the Finance Committee met jointly with the Audit Committee twice during the year ended December 31, 2009 to, among other items, review investment policy. The Finance Committee operates under a written charter adopted by the Board of Directors, a current copy of which is available at the Corporate Governance section of the Company’s website at http://www.citrix.com/site/aboutCitrix/governance/.

Compensation Committee

The Compensation Committee currently consists of Messrs. Bogan and Morin (Chair), and Ms. Caldwell, each of whom served on the Compensation Committee after June 2009. Prior to June 2009, the Compensation Committee consisted of Messrs. Bogan, Dow and Sullivan and Ms. Caldwell. The Compensation Committee is responsible for determining and making recommendations with respect to all forms of compensation to be granted to executive officers of the Company and producing an annual report on executive compensation for inclusion in the Company’s proxy statement for its annual meeting of stockholders in accordance with applicable rules and regulations.

In fulfilling its role, the Compensation Committee also:

The Compensation Committee has the authority to engage its own outside advisors, including experts in particular areas of compensation, as it determines appropriate, apart from counsel or advisors hired by management. In 2009, the Compensation Committee retained Radford Consulting, an independent compensation consultant, which we refer to as Radford, to assist the committee in evaluating the compensation of the Company’s executive officers and directors. Please read the Compensation Discussion and Analysis included in this Proxy Statement for additional information on the role of Radford in the compensation review process.

The Board of Directors has determined that each of the members of the Compensation Committee is independent as defined by the rules of the Nasdaq Global Select Market. In addition, each member of the Compensation Committee is an “outside director” as defined in Section 162(m) of the Internal Revenue Code, and is a “non-employee” director as defined under Section 16 of the Exchange Act.

The Compensation Committee met nine times during the year ended December 31, 2009 and acted by written consent on two occasions. The Compensation Committee operates under a written charter adopted by the Board of Directors, a current copy of which is available in the Corporate Governance section of the Company’s website at

http://www.citrix.com/site/aboutCitrix/governance/.

Nominating and Corporate Governance Committee

The Nominating and Corporate Governance Committee of the Board of Directors currently consists of all of the Company’s independent directors, Messrs. Bogan (Chair), Demo, Dow, Hirji, Morin, Sullivan and Ms. Caldwell, each of whom served on the Nominating and Corporate Governance Committee throughout 2009. In June 2009, Mr. Bogan became the Chair, succeeding Mr. Dow.

The Nominating and Corporate Governance Committee:

The Board of Directors has determined that each member of the Nominating and Corporate Governance Committee meets the independence requirements promulgated by Nasdaq. The Nominating and Corporate Governance Committee met four times during the year ended December 31, 2009. The Nominating and Corporate Governance Committee operates under a written charter adopted by the Board of Directors, a current copy of which is available at the Corporate Governance section of the Company’s website at

http://www.citrix.com/site/aboutCitrix/governance/.

Strategy Committee

The Strategy Committee of the Board of Directors, which was formed on May 27, 2009, currently consists of Messrs. Bogan, Demo and Dow (Chair). The Strategy Committee is responsible for overseeing matters relating to potential mergers, acquisitions, divestitures and other key strategic transactions outside the ordinary course of the Company’s business.

In fulfilling its role, the Strategy Committee also:

The Board of Directors has determined that each member of the Strategy Committee meets the independence requirements promulgated by Nasdaq. The Strategy Committee met once during the year ended December 31, 2009. The Strategy Committee operates under a written charter adopted by the Board of Directors, a current copy of which is available at the Corporate Governance section of the Company’s website at

http://www.citrix.com/site/aboutCitrix/governance/.

For more corporate governance information, you are invited to access the Corporate Governance section of the Company’s website available at

http://www.citrix.com/site/aboutCitrix/governance/.

Report of the Audit Committee of the Board of Directors

This report is submitted by the Audit Committee of the Board of Directors. The Audit Committee currently consists of Messrs. Demo (Chair), Dow, Hirji and Sullivan, each of whom served on the Audit Committee after June 2009. Prior to June 2009, the Audit Committee consisted of Messrs. Demo, Hirji and Morin. Each of Messrs. Demo and Hirji qualifies as an “audit committee financial expert” under the rules of the SEC. The Board of Directors has determined that each member of the Audit Committee meets the independence requirements promulgated by Nasdaq and the SEC, including Rule 10A-3(b)(1) under the Exchange Act. In May 2009, the Audit Committee reviewed the adequacy of its charter. In accordance with the Sarbanes-Oxley Act, the Audit Committee has ultimate authority and responsibility to select, compensate, evaluate and, when appropriate, replace the Company’s independent registered public accountants. The Audit Committee has the authority to engage its own outside advisors, including experts in particular areas of accounting, as it determines appropriate, apart from counsel or advisors hired by management.

During the year ended December 31, 2009, the Company’s independent registered public accounting firm was Ernst & Young LLP (“Ernst & Young”). Ernst & Young was responsible for performing an independent audit of the Company’s consolidated financial statements and an independent audit of the effectiveness of the Company’s internal control over financial reporting in accordance with the standards of the Public Company Accounting Oversight Board (“PCAOB”). Ernst & Young also performed audit-related services, tax services and other permissible non-audit services for the Company during 2009, as described more fully below.

The Audit Committee oversees the accounting and financial reporting processes of the Company and the audits of the consolidated financial statements of the Company on behalf of the Board of Directors. Management has the primary responsibility for the consolidated financial statements and the reporting process, including the Company’s systems of internal controls. In fulfilling its oversight responsibilities, the Audit Committee reviewed with management the audited consolidated financial statements in the Company’s Annual Report on Form 10-K for the

year ended December 31, 2009, and discussed with management the quality, not just the acceptability, of the accounting principles, the reasonableness of significant estimates and judgments, critical accounting policies and accounting estimates resulting from the application of these policies, and the substance and clarity of disclosures in the financial statements, and reviewed the Company’s disclosure controls and procedures and internal control over financial reporting. The Audit Committee reviewed with Ernst & Young, who is responsible for expressing an opinion on the fairness of the Company’s consolidated financial statements in conformity with accounting principles generally acceptable in the United States, Ernst & Young’s judgments as to the quality, not just the acceptability, of the Company’s accounting principles and such other matters as independent registered public accountants are required to discuss with the Audit Committee under auditing standards of the PCAOB. In addition, the Audit Committee has reviewed the services provided by Ernst & Young and discussed with Ernst & Young its independence from management and the Company, including the matters in the written disclosures required by PCAOB Rule 3526 and considered the compatibility of non-audit services with the registered public accountants’ independence.

The Audit Committee discussed with Ernst & Young the overall scope and plan for their annual audit for 2009. The Audit Committee met separately with Ernst & Young in its capacity as the Company’s independent registered public accountants for the Company, with and without management present, to discuss the results of Ernst & Young’s procedures, its evaluations of the Company’s internal control over financial reporting, and the overall quality of the Company’s financial reporting, as applicable.

The Audit Committee has reviewed the audited consolidated financial statements of the Company at December 31, 2009 and 2008 and for each of the years in the three-year period ended December 31, 2009 and has discussed them with both management and Ernst & Young. In connection with the Company’s Annual Report on Form 10-K for the year ended December 31, 2009, the Audit Committee discussed with management the results of the Company’s certification process relating to the certification of financial statements under Sections 302 and 906 of the Sarbanes-Oxley Act. The Audit

Committee has also discussed with Ernst & Young the matters required to be discussed by Statement on Auditing Standards No. 61, as amended by Statement on Auditing Standards Nos. 89 and 90 (Audit Adjustments and Communications with Audit Committees, respectively), as currently in effect. This discussion included, among other things, a review with management of the quality of the Company’s accounting principles, the reasonableness of significant estimates and judgments, and the clarity of disclosure in the Company’s financial statements, including the disclosures related to critical accounting policies and practices used by the Company. Based on its review of the financial statements and these discussions, the Audit Committee concluded that it would be reasonable to recommend, and on that basis did recommend, to the Board of Directors that the audited consolidated financial statements be included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2009.

The Audit Committee also reviewed the Company’s quarterly financial statements during 2009 and discussed them with both the management of the Company and Ernst & Young prior to including such interim financial statements in the Company’s quarterly reports on Form 10-Q. In connection with the Company’s quarterly reports on Form 10-Q for its first, second and third fiscal quarters of 2009, the Audit Committee discussed with management the results of the Company’s certification process relating to the certification of financial statements under Sections 302 and 906 of the Sarbanes-Oxley Act.

During the course of the year ended December 31, 2009, management completed the documentation, testing and valuation of the Company’s system of internal control over financial reporting in response to the requirements set forth in Section 404 of the Sarbanes-Oxley Act and related regulations. The Audit Committee was kept apprised of the progress of the evaluation and provided oversight and advice to management during the process. In connection with this oversight, the Audit Committee received periodic updates provided by management and Ernst & Young at Audit Committee meetings held throughout the year. At the conclusion of the process, management provided the Audit Committee with, and the Audit Committee reviewed, a report on the effectiveness of the Company’s internal control over

financial reporting. The Audit Committee also reviewed the report of management contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2009 filed with the SEC, as well as Ernst & Young’s Reports of Independent Registered Public Accounting Firm included in the Company’s Annual Report on Form 10-K related to its audits of the consolidated financial statements and financial statement schedule and the effectiveness of internal control over financial reporting. The Audit Committee continues to oversee the Company’s efforts related to its internal control over financial reporting and management’s preparations for the evaluation in the fiscal year ending December 31, 2010.

The Audit Committee monitors the activity and performance of Ernst & Young. All services provided by Ernst & Young have been pre-approved by the Audit Committee. The Audit Committee’s evaluation of the performance of Ernst & Young included, among other things, the amount of fees paid to Ernst & Young for audit and permissible non-audit

services in 2009. Information about Ernst & Young’s fees for 2009 is discussed below in this Proxy Statement under Ratification and Appointment of Independent Registered Public Accounting Firm.

No portion of this Audit Committee Report shall be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, through any general statement incorporating by reference in its entirety the Proxy Statement in which this report appears, except to the extent that the Company specifically incorporates this report or a portion of it by reference. In addition, this report shall not be deemed filed under either the Securities Act or the Exchange Act.

Respectfully submitted by the Audit Committee,

Murray J. Demo (Chair)

Stephen M. Dow

Asiff S. Hirji

Godfrey R. Sullivan

Compensation Discussion and Analysis

Purpose of Compensation Discussion and Analysis

This Compensation Discussion and Analysis provides comprehensive information about the 2009 compensation for the following executive officers (our “named executive officers”):

Objectives of Our Executive Compensation Programs

The compensation that we offer our executives is designed to reflect our principles of integrity, fairness and transparency – concepts that have continually underscored the design and delivery of the compensation opportunity at Citrix. We believe our compensation programs should emphasize sustainable corporate growth through a pay-for-performance orientation and a commitment to both operational and organizational execution. We also believe that lavish perquisites (such as a company plane), “golden parachutes,” and bonuses unrelated to the Company’s performance are inconsistent with our executive compensation principles. Furthermore, while the establishment of variable compensation targets for our executives necessarily involves judgment, the actual payouts against those targets are based on pre-determined, objective financial criteria reflective of our operating plan and indicative of positive business growth.

Over the last decade, the objectives of our executive compensation programs have been to:

These objectives still hold true today and are reflected in the compensation decisions we made in 2009. Despite a challenging period of global recession and economic uncertainty in the information technology industry, we followed our established annual process of analysis and planning, continued our practice of full Board engagement in the evaluation and compensation review of our President and Chief Executive Officer, froze executive salaries, made no discretionary adjustments in performance targets nor exchanged stock options with out-of-the-money exercise prices. Rather, we looked to focus our executives on our strategy of profitable growth and to further align their interests with those of our stockholders. For example, in 2009 we introduced an equity-based long term incentive program for our executives with the goal of driving both relative and absolute stockholder returns. Furthermore, we continued to improve our compensation policies by adopting a policy against entering into new single-trigger severance or change of control agreements and strengthening our existing stock ownership requirements. These improvements build on our policy changes in recent years, such as the elimination of tax gross-ups in our executive change of control agreements in 2008.

Going forward, we anticipate that retaining our executive talent will become an increasing focus of our executive compensation programs. Because of our historical success and the unique skills of our executives in the new and meaningful virtualization markets, our executives are highly attractive candidates for roles at larger companies or more senior roles at smaller companies. While sticking to our principles, we’ll seek ways to respond to this challenge in ways that preserve and enhance stockholder value.

Elements of Compensation

The elements of compensation that the Compensation Committee uses to accomplish our objectives include:

The Compensation Committee considered each of these items in determining the individual compensation package for our executive officers.

Compensation Evaluation Processes and Criteria

Evaluation Process

The compensation packages for our executive officers are reviewed by the Compensation Committee and include an analysis of all elements of compensation separately and in the aggregate. In establishing compensation levels for each executive officer, the Compensation Committee has the authority to engage the services of outside experts to assist it. In 2009, Radford Consultants, a global compensation services firm, was retained to provide advisory services to aid the Compensation Committee in its oversight of executive compensation. In addition, our legal, finance and human resources departments support the Compensation Committee in its work and act in accordance with the direction given to them to administer our compensation programs.

Throughout 2009, the Compensation Committee held seven meetings with management, our human resources department and representatives of Radford to:

Beginning in November 2008, and at several meetings throughout the first quarter of 2009, the Compensation Committee reviewed proposed compensation programs and packages for our executive officers for 2009, which were prepared by management and evaluated by our finance department for consistency with our operating plan. In March 2009, the Compensation Committee approved the proposed 2009 Variable Cash Compensation Plan and also approved individual compensation packages for our executive officers, except for our President and Chief Executive Officer. Later in March 2009, after significant analysis, the Compensation Committee discussed the compensation package of our President and Chief Executive Officer with our Board of Directors. Thereafter the package recommended by the Compensation Committee was approved by our Board of Directors.

Evaluation Criteria

In determining the amount and mix of the target compensation elements, the Compensation Committee relies upon its judgment about the scope and strategic impact of each individual executive officer’s role. In setting final compensation targets for our executive officers in 2009, the Compensation Committee considered many factors, including:

Role of the Independent Compensation Consultant

During 2009, Radford reported directly to the Compensation Committee for purposes of advising it on executive compensation matters. The Compensation Committee provided Radford with preliminary instructions regarding the goals of our compensation program and the parameters of the competitive review of executive total direct compensation packages to be conducted by Radford. In particular, for all executive officer positions, Radford was instructed to benchmark all components of compensation, including base salary, total target compensation (base salary plus variable cash compensation), total actual cash compensation and equity-based long-term incentive awards. Next, the Compensation Committee instructed Radford to review the public disclosure by our peer companies concerning their executive compensation practices and to review our internal compensation model and guidelines and compare them to our peer companies and actual compensation practices. Finally, Radford was instructed to test whether the compensation packages for each of our executive officers was competitive with the market and reasonable given our performance relative to our peers as measured by revenue growth, operating income growth, diluted earnings per share growth and total stockholder return, each on a one-and three-year basis.

Throughout the fourth quarter of 2008 and the first quarter of 2009, Radford attended meetings of the Compensation Committee, both with and without members of management present, and interacted with members of our human resources department with respect to its assessment of the compensation packages of our executive officers. Once Radford, working in conjunction with our human resources department, completed its preliminary analysis of our executive compensation, they presented a report to the Compensation Committee in February 2009, and the Compensation Committee reviewed the analysis and provided Radford with feedback and further direction for follow-up analysis.

Other Services Performed by Affiliates of Radford

During 2009, our accounting department engaged Aon Consulting, an affiliate of Aon, Radford’s parent company, as a resource to assist in the determination of the fair value of certain performance-based equity awards and to verify assumptions we use to determine the fair value of our equity-based awards. Additionally, Aon has historically been retained by our treasury department to serve as our broker of record for our world-wide insurance lines. The services purchased from Aon in 2009 were overseen by the Audit Committee of our Board of Directors and were not approved by the Compensation Committee. In total, fees paid to Aon during 2009 for services not related to Radford’s work with our Compensation Committee were $206,000.

Our Use of Benchmarks and Peer Group Analysis

The Compensation Committee annually conducts a competitive analysis of the compensation paid to our executive officers and reviews the compensation practices of our peer group and of the software industry overall. As in prior years, the analysis for 2009 measured our compensation opportunities for executives and actual compensation paid against information from the following sources:

This peer group was limited to technology companies that are our competitors or those that are close comparisons in terms of sales, industry and/or market capitalization and who may compete with us for executive talent. Our Compensation Committee annually evaluates the composition of the peer group and adjusts the composition of the peer group for factors such as recent acquisitions of peer companies or new markets that we have entered. The companies in the 2009 peer group were:

We use the benchmarks as one of several factors to determine appropriate compensation parameters for base salary, variable cash compensation and equity-based, long-term incentives. Our executive compensation decisions are made on a case-by-case basis, and specific benchmark results do not, in and of themselves, determine individual targets. Nevertheless, we would generally expect that, in the aggregate, the total cash compensation we pay to our executives would compare reasonably to the total cash compensation paid to the executives whose companies were included in the peer group and the Radford surveys, and this was the case in 2009.

The Compensation Committee anticipates that it will continue to conduct similar annual reviews of our executive compensation practices and use independent outside consultants for similar services in the future.

Components of Compensation

Base Salary Freeze

In January 2009, we implemented a strategic restructuring program and steps to reduce our headcount by approximately 450 full-time positions. In connection with our 2009 restructuring program, the Compensation Committee determined that all our executive officers would not receive any base salary

increases in 2009. In addition, variable cash compensation targets for executive officers, expressed as a percentage of base salary, remained at 2008 levels.

Generally, salary levels for our executive officers are based on internally-developed ranges informed by an analysis of compensation data reported for similar positions and roles for companies in our peer group. In setting the ranges, the midpoints of these ranges generally correspond to the 50^th percentile of salaries paid to executive officers with comparable responsibilities at the benchmarked peer group and surveyed companies and within the overall software and high technology industry. Whether individual compensation targets are below or above our midpoint is determined by the considerations mentioned above.

Variable Cash Compensation

Our variable cash compensation is based on internally-developed guidelines and ranges, the midpoints of which generally correspond to the 50^th percentile of similar variable cash compensation provided to officers in similar positions at companies included in the selected benchmarks. For 2009, this translated into target awards that ranged from 55% to 112.5% of base salary, depending on the role of the executive and the other factors discussed above.

As in prior years, in 2009, our Compensation Committee adopted a Variable Cash Compensation Plan for the benefit of our executive officers. Our Variable Cash Compensation Plan is overseen by the Compensation Committee, and administrative tasks are delegated to management. Consistent with our operating plan, the financial targets and attainment levels for variable cash compensation are adjusted to exclude certain GAAP measurements, including amortization of intangible assets primarily related to business combinations, non-cash charges associated with the expensing of equity-based compensation, charges recorded in connection with our 2009 restructuring program and any other items adjusted from our GAAP results in our reported earnings. In addition, the Compensation Committee and our Board of Directors retain the right to amend, alter or terminate our Variable Cash Compensation Plan at any time. This right provides the Compensation Committee and our Board of Directors the discretion to decrease or increase payouts to account for extraordinary circumstances and to balance the interests of the plan participants with the interests of

our stockholders. In 2009, despite the uncertainty in our operating environment, the Compensation Committee did not adjust the resulting payouts under the Variable Cash Compensation Plan or our 2009 performance-based restricted stock unit awards discussed below.

Components of Variable Cash Compensation

Participants in our Variable Cash Compensation Plan received variable cash compensation awards for 2009 based upon the achievement of objective financial goals, which included targets based on reported revenue and non-GAAP corporate operating margin, and achievement of MBOs relating to specific strategic, operational, organizational and individual goals that supported our 2009 corporate objectives. To focus the leadership team on achievement of key corporate objectives, the Compensation Committee increased the weight placed on the MBO component of total variable cash compensation from 10% in 2008 to 15%, resulting in a corresponding reduction in the weight of the financial component to 85%. The MBO component included a shared goal of $25 million in revenue in 2009 from sales of our XenDesktop product as well as goals for each executive related to his respective business areas.

Financial Component

To ensure the integrity of our operational plan, and to safeguard stockholder value, the payout levels under our Variable Cash Compensation Plan are designed to motivate performance that meets or exceeds our financial plan objectives while mitigating undue exposure for under-performance of these objectives. We rigorously test our plan design to ensure that the structure and possible outcomes do not create incentives for our executives to take unnecessary and excessive risks that would impact our long-term value.

The financial targets for our Variable Cash Compensation Plan are first developed through our annual planning process, which commences in the fall of each year and culminates in a final approval from our Board of Directors early in the plan year. In our 2009 annual financial plan, we targeted aggressive growth relative to overall forecasted growth for the information technology industry and improved profitability relative to our profitability in 2008.

Annually, we model all potential award payouts generated by various performance attainment levels against corporate goals for revenue, non-GAAP earnings per share and non-GAAP corporate operating margin. We also model the likely impact on stockholder value based on achieving various revenue and non-GAAP earnings per share and corporate operating income targets. This modeling helps to inform threshold, target and maximum payout levels for the plan and ensures that Variable Cash Compensation Plan awards, when viewed relative to non-GAAP earnings per share and corporate operating margin goals, are appropriate and provide the right balance of compensation to our executives for actual results versus returns to the business and our stockholders.

For 2009, each executive’s variable cash compensation award was based 85% on the achievement of financial targets established by the Compensation Committee, consistent with our annual operating plan. Our Variable Cash Compensation Plan weighted these financial components as follows:

Our Variable Cash Compensation Plan provided for a premium in the event of overachievement of targets, capped at 200% of the target payout amount, and a reduction in the event of underachievement of targets, depending on actual results. The following maximum performance amounts would have resulted in a payout of 200% of the target amount:

Our Variable Cash Compensation Plan also contained minimum performance requirements that needed to be met before any award could be earned, including

Furthermore, no payouts could occur under our Variable Cash Compensation Plan if the company

achieved less than $1.53 of non-GAAP earnings per share in 2009.

When actual performance falls between the threshold and the target performance level or between the target and maximum performance level, payouts are calculated using a graduated slope to provide for the fair distribution of operating profit for overachievement and appropriate compensation reductions for underachievement, as applicable.

MBO Component

In 2009, in an effort to further align our executive compensation with our corporate strategy, the Compensation Committee determined that the MBO component of our Variable Cash Compensation Plan would account for 15% of each executive officer’s potential variable cash compensation and that the targets would be measureable and aligned with specific strategic, operational and people goals, including:

Our Chief Executive Officer recommended for approval by the Compensation Committee an MBO achievement rating for each executive officer, other than himself, based on such executive’s performance and a self-evaluation of his individual MBOs. Depending on his performance, an executive officer would be entitled to a payout between 0% and 125% of the target MBO. Our Compensation Committee recommended to our Board of Directors, and our Board of Directors determined, the MBO achievement for our Chief Executive Officer based on his performance and informed by his self-evaluation and an evaluation of our Chief Executive Officer by his direct reports.

Target Cash Compensation Mix

The Compensation Committee’s decision to maintain 2008 levels for base salaries and target payouts under

our Variable Cash Compensation Plan along with the 5% shift in weight from the financial component to the MBO component, resulted in the following target

mix of cash compensation for our executive officers, expressed both as a percentage of total targeted cash compensation and in dollars:

Determination of Awards

In the first quarter of 2010, our Senior Vice President and Chief Financial Officer reviewed and approved the calculations of financial target attainment levels and the 2009 award amounts payable to executive officers that were generated by members of our human resources department in accordance with the terms of our Variable Cash Compensation Plan. These financial target and MBO attainment levels and award calculations were presented to the Compensation Committee for its review and approval at a meeting held in February 2010. At that meeting, the Compensation Committee determined that the reported revenue target of $1.613 billion was 100.1% attained and the non-GAAP corporate operating margin target of 23.68% was 100.8% attained. Based on these attainment levels, the Compensation Committee determined that each of our executive

officers participating in our Variable Cash Compensation Plan was entitled to receive a variable cash compensation award equal to 103.55% of the financial component of his variable cash compensation target award. At the same meeting, the Compensation Committee determined that the shared team strategic objective of XenDesktop product revenue of $25 million was fully attained and that individual MBO targets for each executive officer, except for our President and Chief Executive Officer, were attained according to achievement ratings recommended by our Chief Executive Officer, with individual MBO ratings resulting in payouts ranging from 120% to 125% of each executive’s MBO component. Later in February 2010, our Board of Directors determined that the individual targets for our President and Chief Executive Officer were attained, with his individual MBO rating resulting in a payout of 120% of his MBO component.

Equity-Based Long-Term Incentives

The purpose of our equity-based long-term incentives is to attract and retain high performing employees, further align employee and stockholder interests and continue to closely link employee compensation with company performance. Our equity-based long-term incentive program is an essential component of the total compensation package offered to employees, reflecting the importance that we place on motivating and rewarding superior results with long-term and performance-based incentives.

Portfolio Approach to Equity-Based Awards

Since 2006, we have granted to executive officers a portfolio of equity-based awards consisting of a mix of both stock options and restricted stock units (both performance-based and service-based) pursuant to our 2005 Equity Incentive Plan, or the 2005 Plan. We believe that a mix of stock options and restricted stock units provides an effective incentive for our high performers to remain with us and continue to perform at a high level. Furthermore, the portfolio offering of both options and restricted stock units has important benefits to our executives, our company and our stockholders. For executives, it provides portfolio diversification and leverages the advantages of each vehicle in motivating our executives to drive our business objectives. For our company and its stockholders, option value is driven by stock price

appreciation (to align our interest with that of our stockholders), performance-based restricted stock units drive the achievement of key business objectives and service-based restricted stock units drive retention of our executives. In addition, the use of restricted stock units furthers our goals of reducing dilution, burn rate and overhang by reducing the number of shares of Common Stock subject to equity-based awards.

Annually, the Compensation Committee reviews our targeted mix of stock options and restricted stock units and in 2009 found that our portfolio approach to equity-based compensation is reasonably designed to achieve our goals of retention, providing incentives for high performers, management of our shares outstanding and stockholder alignment.

For 2009, the Compensation Committee decided to continue the established equity mix of stock options and restricted stock unit awards so that 50% of the value of the total equity package was comprised of stock options and 50% was comprised of restricted stock units (30% of total value represented in performance-based restricted stock units and 20% of total value represented in service-based restricted stock units) to provide an appropriate balance among the elements of compensation awarded to our executive officers.

Because restricted stock units are full value awards, the number of restricted stock units that need to be

granted to reach the 50% value threshold is less than the number of options that would be required to reach the same value level. The Compensation Committee has determined that each time-vesting share represented by a restricted stock unit is equivalent to three stock option shares, and each performance-vesting share represented by a restricted stock unit is equivalent to two and one-half stock option shares. Annually, the Compensation Committee reviews these ratios of option based instruments to full value awards to ensure an appropriately balanced portfolio of equity-based awards.

Equity-Based Award Grant Levels

When establishing equity grant levels for our executive officers, the Compensation Committee considers the existing number and value of vested and unvested stock, stock option and restricted stock unit ownership among the executive officers relative to each other and to our employees as a whole, previous grants of equity-based awards to our executive officers, our overhang of equity-based awards and targeted burn rates for equity-based awards, the vesting schedules of previously granted equity-based awards, as well as the various other factors described above. In addition, the Compensation Committee reviews the equity-based award grant levels of executive officers in our peer group. Individual awards are then determined after assessing the executive’s performance, strategic impact on the business given his role and experience and his potential to drive execution of our future business objectives. In 2009, the data from our benchmarking suggested that in the aggregate equity-based long-term incentive grants made in 2009 were at about the 50^th percentile of reported equity-based awards made by our peer group companies.

Stock Option Awards

Our executive officers generally receive annual stock option awards in two grants, which are pre-determined to follow our quarterly earnings releases. See Equity Award Grant Policy below. As part of our 2009 restructuring program discussed above, we changed the timing of our annual grant process such that all annual equity-based awards, including awards to our executive officers, were made on one grant date in March 2009.

Restricted Stock Unit Awards

Pursuant to the 2005 Plan, we may grant executive officers both performance-based restricted stock units and service-based restricted stock units. Once vested, each restricted stock unit represents the right to receive one share of our Common Stock. The grants of restricted stock unit awards are based upon the same factors used to evaluate stock option grants.

In 2009, the performance criteria and attainment levels for grants of performance-based restricted stock units were based upon successful achievement of a non-GAAP corporate operating margin target of 23.68%. These performance-based restricted stock unit awards were awarded with a non-GAAP corporate operating margin target to closely link the executives’ performance-based equity compensation with the overall financial performance of the company. The number of restricted stock units underlying a performance-based award is generally determined one year after the date of the award based on the achievement of the specific performance objective. If the performance goal is less than 90% attained, then no performance-based restricted stock units will be issued pursuant to the authorized award. For performance at and above 90% attainment, the number of performance-based restricted stock units issued is based on a graduated slope, with the maximum number of performance-based restricted stock units issuable pursuant to the award capped, for 110% attainment, at 125% of the target number of restricted stock units set forth in the award agreement. Once the number of restricted stock units is determined, the units are subject to service-based vesting as described below.

In February 2010, our Compensation Committee determined that the non-GAAP corporate operating margin target of 23.68% under our 2009 performance-based restricted stock unit awards to our executive officers was 100.8% attained. Based on the graduated payout slope, this attainment translated to a payout of 100% of the 2009 target award for performance-based restricted stock units, which restricted stock units were subject to vesting and other requirements of the restricted stock unit agreements.

The performance-based restricted stock units vest over three years, with one-third of the units vesting on the first, second and third anniversaries of the date of the award agreement. Under the terms of the

restricted stock unit agreements, no shares of stock may be issued to settle restricted stock units until the performance criteria has been met and the number of restricted stock units underlying the award is determined.

In addition to the performance-based restricted stock units described above, in 2006 we began granting service-based restricted stock units to our executive officers in accordance with the objectives outlined above. Consistent with this practice, in the March

2009, we entered into restricted stock unit agreements with our executive officers for service-based restricted stock unit awards that were not subject to performance criteria and that vest over three years, with one-third of the units vesting on the first, second and third anniversaries of the date of the award agreement.

The following table summarizes our 2009 equity-based awards to our executive officers:

Long-Term Incentive Plan

In 2009 we instituted a long-term incentive program, or LTIP, for our executive officers to provide further focus and alignment with our profitable growth strategy. Both the LTIP plan design and structure reinforce executive actions supportive of stockholder interests. Executives will be rewarded only if they generate both relative and absolute stockholder returns; and, as executives will be required to hold awarded shares until termination or retirement, they will be further motivated to take actions that foster sustainable growth and avoid unnecessary and excessive risks that may threaten our long-term value.

Under the LTIP, our executives have the opportunity to earn restricted stock units based on the performance of our Common Stock against a weighted average of specific market indices over a three-year period ending December 31, 2011. The number of shares of our Common Stock issuable upon settlement of these LTIP awards is generally determined after the end of the three-year period and is issuable to the executive only if the executive has remained employed by us throughout the three-year period. Further, after LTIP awards have vested, the

executive must hold the shares until the earlier of termination or retirement, and LTIP awards are forfeited if the executive is terminated for cause.

The number of shares of Common Stock issuable upon settlement of the LTIP restricted stock units is determined by comparing the performance of our Common Stock to the performance of a weighted average of specific market indices over the same three-year period. We measure performance based on the difference between the average closing price for the last 30 business days of the three-year period and the closing price on the last business day before the start of the three-year period. If our Common Stock outperforms the market indices by 33% or more, each executive officer will vest in a number of restricted stock units equal to his target award multiplied by the percentage by which the appreciation of our Common Stock exceeded the appreciation of the market indices, up to a maximum of 200% if our Common Stock outperforms the market indices by 200% or more. If our Common Stock does not outperform the market indices by at least 33%, then no restricted stock units vest. Furthermore, to ensure that restricted stock units vest only if we increase stockholder value in absolute terms, no restricted stock units vest if our Common Stock does not

appreciate by at least 10% during the three-year performance period.

In order to ensure that we are measuring our performance against both the market as a whole and companies within our industry, the Compensation Committee decided to measure our stock appreciation against the weighted average of the S&P 500 (GSPC) and the S&P North American Technology (S&P GSTI (IGM)) indices. The S&P 500 (GSPC) index provides a broad measure of market performance,

and the S&P North American Technology index reflects the performance of technology companies, including members of our peer group. We place relatively more weight on the S&P 500 (GSPC) index (2/3) than on the S&P North American Technology index (1/3) because it provides a broader measure of overall market performance.

The following table summarizes the target LTIP awards granted to our executive officers in May 2009:

Equity Award Grant Policy

In 2007, the Compensation Committee adopted the Citrix Systems, Inc. Equity Award Grant Policy, or the Awards Policy. The Awards Policy enhances our controls with respect to grants of equity awards by establishing procedures for approving and predetermining the dates on which awards will be made. Pursuant to the Awards Policy, unless a different date is set by our Board of Directors or the Compensation Committee, annual grants of stock options are made in two installments, with 50% being granted on the last business day in April and 50% being granted on the last business day in July, and annual grants of full value awards (for example, restricted stock and restricted stock units) are made 100% on the last business day in March on or prior to March 30th. The Awards Policy also establishes fixed grant dates for new hire and performance grants. An employee’s eligibility to receive an award as of a particular, fixed grant date is subject to the time of the month in which the employee’s employment begins or promotion is effective or, if later, the date on which all documentation necessary for the approval of the grant is obtained. A copy of our Awards Policy is available at the Corporate Governance section of our website at http://www.citrix.com/site/aboutCitrix/governance/ under Governance Documents.

In the first quarter of 2009, the Compensation Committee approved a change to the timing of our

granting of annual stock option and restricted stock unit awards to executive officers and other key employees in light of our 2009 restructuring program adopted by our Board of Directors in January 2009. The Compensation Committee determined that, in order to enhance employee retention and morale following the implementation of the 2009 restructuring program, our 2009 annual grants of stock options and restricted stock unit awards would be made in a single installment on the first business day in March instead of in two installments in April and July.

Executive Stock Ownership Guidelines

In 2008, to further align the interests of our executive officers with the interests of our stockholders, our Board of Directors adopted stock ownership guidelines for our executive officers. These guidelines were revised in March 2010 to increase our stock holding requirements. Pursuant to our current guidelines, our Chief Executive Officer is expected to own at least 100,000 shares of our Common Stock, our Chief Financial Officer is expected to own at least 25,000 shares and each other executive officer is expected to own at least 20,000 shares of Common Stock. Each of our executive officers is expected to hold such shares for so long as he is one of our executive officers. Executive officers are expected to meet these guidelines within four years of the date of his appointment as an executive officer. Our current executive officers are permitted

an additional two years from their original compliance deadline to comply with our increased stock holding requirements. Failure to satisfy the stock holding guidelines when required to do so will result in suspension of an executive officer’s ability to sell shares of our Common Stock until the requisite ownership levels are reached. Our executive officers may accumulate shares of our Common Stock through stock option exercises, settlement of restricted stock units or other awards and open market purchases made in compliance with applicable securities laws, our policies or any other equity plans we may adopt from time to time. Shares of our Common Stock beneficially owned (unless the executive officer disclaims beneficial ownership of the shares) and vested restricted stock and LTIP units count towards the satisfaction of the ownership guidelines.

Additionally, under our policies, our employees, including our executive officers, and directors are not permitted to engage in the following transactions with respect to our stock: sell short, buy or sell puts, calls or other derivatives of our stock, buy our stock on margin, hold an account containing our stock that is, or is linked to, a margin account, or pledge our stock as collateral for a loan.

Policy Regarding Severance Payments

In 2009, the Compensation Committee adopted a policy providing that we will not enter into any new agreements, or materially amend any existing agreements, with our executive officers that provides the executive officer with severance payments following a change in control, except in the case of a double-trigger termination event (that is, upon the termination of the executive’s employment without cause or for good reason following a change in control).

Benefits

Our executive officers participate in our broad-based employee benefit plans on the same terms as eligible, non-executive employees, subject to any legal limits on the amounts that may be contributed or paid by executive officers under these plans. We offer a stock purchase plan, under which our employees may purchase Common Stock at a 15% discount from the fair market value of our Common Stock on the last business day of the purchase period (determined by reference to the closing price of our Common Stock

on such date), and a 401(k) plan, which allows our employees to invest in a wide array of funds on a pre-tax basis and which provides a matching contribution from our company. We also maintain insurance and other benefit plans for our employees. Our executive officers receive higher life, accidental death and dismemberment and disability insurance benefits than other employees, which reflects industry standards and their relative base salary levels. Our executive officers also receive reimbursement for annual health physicals. During 2009, we did not offer any non-qualified deferred compensation plans or supplemental retirement plans to our executives. For more information, please refer to the Summary Compensation Table below.

We have always limited the perquisites that are made available to our executives. Our executives are entitled to few benefits that are not otherwise available to all employees and generally provided to ensure comparable coverage levels for insurance and health care relative to market practice in our industry sector. In this regard, it should be noted that we do not provide pension arrangements or similar benefits to our executives or employees, other than a 401(k) program, in which all of our employees, including our executive officers, may participate and defined contribution plans required by applicable law in certain jurisdictions outside the United States, in which none of our named executive officers participate.

Discussion of Summary Compensation and Grants of Plan-Based Awards Tables

Our executive compensation policies and practices, pursuant to which the compensation set forth in the Summary Compensation Table and the Grants of Plan-Based Awards Table was paid or awarded, are described above under Compensation Discussion and Analysis. A description of the application of those policies and practices to each of the Named Executive Officers for the year ended December 31, 2009 is set forth below. In 2009, because of our restructuring program, the Compensation Committee determined that all our executive officers, including the Named Executive Officers discussed below, would not receive any base salary increases in 2009. In addition, variable cash compensation targets for executive officers, including the Named Executive Officers discussed below, expressed as a percentage of base salary remained at 2008 levels.

President and Chief Executive Officer

As President and Chief Executive Officer, Mark Templeton is responsible for overseeing all of our corporate functions, product groups and divisions, go-to-market activities and directing us to ensure the attainment of our revenue and profit goals. Working in concert with our Board of Directors, Mr. Templeton formulates current and long-term company plans and objectives, and represents us in relations with our customers and the business and non-business communities. Based on a recommendation of the Compensation Committee, our Board of Directors determines compensation for our President and Chief Executive Officer using the same factors it uses for other executives, placing relatively less emphasis on base salary and, instead, creating greater performance-based opportunities through equity-based long-term and variable cash compensation. In assessing the compensation paid to Mr. Templeton, the Compensation Committee relies on both information from selected benchmarks and its judgment with respect to the factors described above.

In addition, the Compensation Committee uses a formal evaluation process, which includes meetings held in executive session, to help assess the performance of our President and Chief Executive Officer. This process consists of an annual self-evaluation by Mr. Templeton against the personal performance objectives and targets established at the beginning of the year by Mr. Templeton and our Board

of Directors, which is submitted to the Chairman of the Compensation Committee and the Chairman of the Nominating and Corporate Governance Committee after the conclusion of each year. Each member of our Board of Directors and each senior executive officer who reports directly to Mr. Templeton also annually completes an evaluation of Mr. Templeton’s performance versus our internal leadership standards. Following an assessment of Mr. Templeton’s performance, the Compensation Committee reviews the total compensation package for Mr. Templeton, including base salary, variable cash compensation and equity-based compensation, as described below.

Base Salary. As a result of the 2009 salary freeze for executive officers, Mr. Templeton’s annual base salary remained at $800,000.

Variable Cash Compensation. For 2009, Mr. Templeton was awarded cash compensation of $954,158 in accordance with our Variable Cash Compensation Plan, an increase from his 2008 award of $479,664. The increase in Mr. Templeton’s 2009 variable cash compensation is primarily due to our 2008 operational performance, which under the 2008 Variable Cash Compensation Plan led to only a 53.3% payout of Mr. Templeton’s target variable cash compensation award. Mr. Templeton’s 2009 variable cash compensation award was determined in accordance with the criteria outlined in our Variable Cash Compensation Plan. Under our Variable Cash Compensation Plan, the financial component of Mr. Templeton’s target variable cash compensation award for 2009 (which comprised 83% of his total target award) was as follows:

In addition to the shared strategic objective of $25 million of XenDesktop product revenue in 2009, the MBO component of Mr. Templeton’s target variable cash compensation award for 2009 (which comprised 17% of his total target award) consisted of goals related to product integration and simplification, brand awareness, cost structure optimization, increasing go-to-market productivity, the development of standardized internal services, organizational structure, employee engagement and talent development.

Because of the 2009 salary freeze for executive officers, Mr. Templeton’s target variable cash compensation award for 2009 was maintained at 112.5% of his base salary, which was his 2008 level. This balance between base compensation and Mr. Templeton’s target variable cash compensation award is consistent with our objective of placing relatively more emphasis on variable cash compensation for our President and Chief Executive Officer to ensure close alignment of his interests with the interests of our stockholders.

Consistent with our pay-for-performance objective and in light of our actual achievement against the targets reported in the Compensation Discussion and Analysis above, Mr. Templeton received 103.5% of the financial component of his 2009 target award and 120% of the MBO component of his 2009 target award, resulting in an overall variable cash compensation award equal to 106.0% of his 2009 target award.

Equity-Based Long-Term Incentive. In line with our special 2009 annual grant process, the Board of Directors on March 2, 2009 granted Mr. Templeton options to purchase 137,500 shares of our Common Stock subject to our standard vesting schedule. In addition, on March 2, 2009, our Board of Directors granted Mr. Templeton a performance-based restricted stock unit award pursuant to which Mr. Templeton was eligible to earn restricted stock units based on the achievement of our 2009 non-GAAP corporate operating margin target. In February 2010, Mr. Templeton received 33,000 restricted stock units based on our achieving 100.8% of our non-GAAP corporate operating margin target. On March 2, 2009, Mr. Templeton was also granted 18,333 service-based restricted stock units, which vest in three equal annual installments. On May 1, 2009, our Board of Directors granted Mr. Templeton a target LTIP award of 60,000 restricted stock units, subject to the three-year performance requirements described in the Compensation Discussion and Analysis above. The size of the annual option grant and the number of restricted stock units potentially awardable under each restricted stock unit award were determined in accordance with the factors discussed above. See the Grants of Plan Based Awards Table.

Senior Vice President and Chief Financial Officer

Base Salary. As Senior Vice President and Chief Financial Officer, David Henshall is responsible for overseeing our relations with our investors, budgeting and planning, financial accounting, financial operations, tax, treasury, information technology and supply chain management. Mr. Henshall is also responsible for our financial plans and policies and the establishment of our overall financial strategy. As Senior Vice President and Chief Financial Officer, Mr. Henshall works closely with our President and Chief Executive Officer to drive our overall growth and stockholder returns. As a result of the 2009 salary freeze for executive officers, Mr. Henshall’s annual base salary remained at $435,000.

Variable Cash Compensation. For 2009, Mr. Henshall was awarded cash compensation of $325,107 in accordance with our Variable Cash Compensation Plan, an increase from his 2008 award of $162,286. The increase in Mr. Henshall’s 2009 variable cash compensation is primarily due to our 2008 operational performance, which under the 2008 Variable Cash Compensation Plan led to only a 53.3% payout of Mr. Henshall’s target variable cash compensation award. Mr. Henshall’s 2009 variable cash compensation award was determined in accordance with the criteria outlined in our Variable Cash Compensation Plan. Under our Variable Cash Compensation Plan, the financial component of Mr. Henshall’s target variable cash compensation award for 2009 (which comprised 82% of his total award) was the same as that detailed above for Mr. Templeton; and in addition to the shared strategic objective of $25 million of XenDesktop product revenue in 2009, the MBO component of Mr. Henshall’s target variable cash compensation award for 2009 (which comprised 18% of his total award) consisted of goals related to financial planning, cost structure optimization, further development of internal systems and organizational development.

Because of the 2009 salary freeze for executive officers, Mr. Henshall’s target variable cash compensation award for 2009 was set at 70% of his base salary, the same level as was set in 2008.

Consistent with our pay-for-performance philosophy and in light of our actual achievement against the targets reported in the Compensation Discussion and

Analysis above, Mr. Henshall received 103.5% of the financial component of his 2009 target award and 125% of the MBO component of his 2009 target award, resulting in an overall variable cash compensation award equal to 106.8% of his 2009 target award.

Equity-Based Long-Term Incentive. In line with our special 2009 annual grant process, the Compensation Committee awarded Mr. Henshall options to purchase 55,000 shares of our Common Stock granted in full on March 2, 2009 and subject to our standard vesting schedule. In addition, on March 2, 2009, the Compensation Committee granted Mr. Henshall a performance-based restricted stock unit award pursuant to which Mr. Henshall was eligible to earn restricted stock units based on the achievement of our 2009 non-GAAP corporate operating margin target. In February 2010, Mr. Henshall received 13,200 restricted stock units under this award because we achieved 100.8% of our non-GAAP corporate operating margin target. On March 2, 2009, the Compensation Committee also granted a service-based restricted stock unit award to Mr. Henshall for 7,333 restricted stock units, which vest in three equal annual installments. On May 1, 2009, our Compensation Committee granted Mr. Henshall a target LTIP award of 20,300 restricted stock units, subject to the three-year performance requirements described in the Compensation Discussion and Analysis above. The size of the option grant and the number of restricted stock units potentially awardable under each restricted stock unit agreement were determined in accordance with the factors discussed above. See the Grants of Plan Based Awards Table.

Senior Vice President, Sales and Services

Base Salary. As Senior Vice President, Sales and Services, Alvaro Monserrat is responsible for our worldwide sales efforts and our channel and distribution network. As a result of the 2009 salary freeze for executive officers, Mr. Monserrat’s annual base salary remained at $375,000.

Variable Cash Compensation. For 2009, Mr. Monserrat was awarded cash compensation of $397,566 in accordance with our Variable Cash Compensation Plan, an increase from his 2008 award of $230,722. Because of his promotion in July of 2008, Mr. Monserrat participated in our Variable Cash Compensation Plan for only a portion of 2008

and participated in our Vice President Compensation Plan for the balance of 2008. Mr. Monserrat’s 2009 variable cash compensation award was determined in accordance with the criteria outlined in our Variable Cash Compensation Plan. Under our Variable Cash Compensation Plan, the financial component of Mr. Monserrat’s target variable cash compensation award for 2009 (which comprised 83% of his total award) was the same as that detailed above for Mr. Templeton; and in addition to the shared strategic objective of $25 million of XenDesktop product revenue in 2009, the MBO component of Mr. Monserrat’s target variable cash compensation award for 2009 (which comprised 17% of his total award) consisted of goals related to building a systems integrator distribution channel, development of our sales operations function and organizational development.

Because of the 2009 salary freeze for executive officers, Mr. Monserrat’s target variable cash compensation award for 2009 was set at 100% of his base salary, the same level as was set in 2008.

Consistent with our pay-for-performance philosophy and in light of our actual achievement against the targets reported in the Compensation Discussion and Analysis above, Mr. Monserrat received 103.5% of the financial component of his 2009 target award and 120% of the MBO component of his 2009 target award, resulting in an overall variable cash compensation award equal to 106.0% of his 2009 target award.

Equity-Based Long-Term Incentive. In line with our special 2009 annual grant process, the Compensation Committee awarded Mr. Monserrat options to purchase 50,000 shares of our Common Stock granted in full on March 2, 2009 and subject to our standard vesting schedule. In addition, on March 2, 2009, the Compensation Committee granted Mr. Monserrat a performance-based restricted stock unit award pursuant to which Mr. Monserrat was eligible to earn restricted stock units based on the achievement of our 2009 non-GAAP corporate operating margin target. In February 2010, Mr. Monserrat received 12,000 restricted stock units under this agreement because we achieved 100.8% of our non-GAAP corporate operating margin target. On March 2, 2009, the Compensation Committee granted Mr. Monserrat a service-based restricted stock unit award pursuant to which Mr. Monserrat was granted 6,666 restricted stock units, which vest in three equal

annual installments. On May 1, 2009, our Compensation Committee granted Mr. Monserrat a target LTIP award of 25,000 restricted stock units, subject to the three-year performance requirements described in the Compensation Discussion and Analysis above. The size of the option grant and the number of restricted stock units potentially awardable under each restricted stock unit agreement were determined in accordance with the factors discussed above. See the Grants of Plan Based Awards Table.

General Counsel and Senior Vice President, Human Resources

Base Salary. As General Counsel and Senior Vice President, Human Resources, David Friedman is our principal legal and human resources executive. In his General Counsel role, Mr. Friedman is involved in the oversight of acquisitions, commercial transactions, corporate governance initiatives, regulatory, litigation and other legal matters. As our principal human resources executive, Mr. Friedman leads our strategic efforts to recruit and manage our employees and develop competitive pay and benefits practices. As a result of the 2009 salary freeze for executive officers, Mr. Friedman’s annual base salary remained at $395,000.

Variable Cash Compensation. For 2009, Mr. Friedman was awarded cash compensation of $231,301 in accordance with our Variable Cash Compensation Plan, an increase from his 2008 award of $115,786. The increase in Mr. Friedman’s 2009 variable cash compensation is primarily due to our 2008 operational performance, which under the 2008 Variable Cash Compensation Plan led to only a 53.3% payout of Mr. Friedman’s target variable cash compensation award. Mr. Friedman’s 2009 variable cash compensation award was determined in accordance with the criteria outlined in our Variable Cash Compensation Plan. Under our Variable Cash Compensation Plan, the financial component of Mr. Friedman’s target variable cash compensation award for 2009 (which comprised 83% of his total award) was the same as that detailed above for Mr. Templeton; and in addition to the shared strategic objective of $25 million of XenDesktop product revenue in 2009, the MBO component of Mr. Friedman’s target variable cash compensation award for 2009 (which comprised 17% of his total award) consisted of goals related to succession planning, centralization of legal and human resource

functions, employee retention and further development of organizational development tools.

Because of the 2009 salary freeze for executive officers, Mr. Friedman’s target variable cash compensation award for 2009 was set at 55% of his base salary, the same level as was set in 2008.

Consistent with our pay-for-performance philosophy and in light of our actual achievement against the targets reported in the Compensation Discussion and Analysis above, Mr. Friedman received 103.5% of the financial component of his 2009 target award and 123% of the MBO component of his 2009 target award, resulting in an overall variable cash compensation award equal to 106.5% of his 2009 target award.

Equity-Based Long-Term Incentive. In line with our special 2009 annual grant process, our Compensation Committee on March 2, 2009 granted Mr. Friedman options to purchase 47,500 shares of our Common Stock subject to our standard vesting schedule. In addition, on March 2, 2009, our Compensation Committee granted Mr. Friedman a performance-based restricted stock unit award pursuant to which Mr. Friedman was eligible to earn restricted stock units based on the achievement of our 2009 non-GAAP corporate operating margin target. In February 2010, Mr. Friedman received 11,400 restricted stock units under this agreement because we achieved 100.8% of our non-GAAP corporate operating margin target. On March 2, 2009, the Compensation Committee granted Mr. Friedman a service-based restricted stock unit award pursuant to which Mr. Friedman was granted 6,333 restricted stock units, which vest in three equal annual installments. On May 1, 2009, our Compensation Committee granted Mr. Friedman a target LTIP award of 14,483 restricted stock units, subject to the three-year performance requirements described in the Compensation Discussion and Analysis above. The size of the option grant and the number of restricted stock units potentially awardable under each restricted stock unit agreement were determined in accordance with the factors discussed above. See the Grants of Plan Based Awards Table.

Senior Vice President and General Manger, Desktop Division

Base Salary. As Senior Vice President of our Desktop Division, J. Gordon Payne is responsible for

leading our largest product division. As a result of the 2009 salary freeze for executive officers, Mr. Payne’s annual base salary remained at $325,000.

Variable Cash Compensation. For 2009, Mr. Payne was awarded cash compensation of $241,190 in accordance with our Variable Cash Compensation Plan. Mr. Payne’s 2009 variable cash compensation award was determined in accordance with the criteria outlined in our Variable Cash Compensation Plan. Under our Variable Cash Compensation Plan, the financial component of Mr. Payne’s target variable cash compensation award for 2009 (which comprised 83% of his total award) was the same as that detailed above for Mr. Templeton; and in addition to the shared strategic objective of $25 million of XenDesktop product revenue in 2009, the MBO component of Mr. Payne’s target variable cash compensation award for 2009 (which comprised 17% of his total award) consisted of goals related to driving product simplification, development of a new self-service model for enterprise IT, operating expense reductions, cross-divisional product development and product design improvements.

Because of the 2009 salary freeze for executive officers, Mr. Payne’s target variable cash compensation award for 2009 was set at 70% of his base salary, the same level as was set in 2008.

Consistent with our pay-for-performance philosophy and in light of our actual achievement against the targets reported in the Compensation Discussion and Analysis above, Mr. Payne received 103.5% of the

financial component of his 2009 target award and 120% of the MBO component of his 2009 target award, resulting in an overall variable cash compensation award equal to 106.0% of his 2009 target award.

Equity-Based Long-Term Incentive. In line with our special 2009 annual grant process, on March 2, 2009 our Compensation Committee granted Mr. Payne options to purchase 47,500 shares of our Common Stock subject to our standard vesting schedule. In addition, on March 2, 2009, our Compensation Committee granted Mr. Payne a performance-based restricted stock unit award pursuant to which Mr. Payne was eligible to earn restricted stock units based on the achievement of our 2009 non-GAAP corporate operating margin target. In February 2010, Mr. Payne received 11,400 restricted stock units under this award because we achieved 100.8% of our non-GAAP corporate operating margin target. On March 2, 2009, the Compensation Committee granted Mr. Payne a service-based restricted stock unit award pursuant to which Mr. Payne was granted 6,333 restricted stock units, which vest in three equal annual installments. On May 1, 2009, our Compensation Committee granted Mr. Payne a target LTIP award of 15,167 restricted stock units, subject to the three-year performance requirements described in the Compensation Discussion and Analysis above. The size of the option grant and the number of restricted stock units potentially awardable under each restricted stock unit agreement were determined in accordance with the factors discussed above. See the Grants of Plan Based Awards Table.