On July 29, 2008, Secure Computing Corporation (the “Company”) and Aladdin Knowledge Systems Ltd. (“Aladdin”) entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”) providing for the sale of the Company’s identity and access management (“IAM”) product line and certain other assets, leases and contracts relating to the IAM product line (collectively, the “IAM Assets”).

Pursuant to the Asset Purchase Agreement, and upon the terms and subject to the conditions thereof, Aladdin will pay the Company $64,250,000 in cash, less certain transaction costs (the “Purchase Price”), as consideration for the IAM Assets, and will assume certain liabilities related to the IAM product line. An amount equal to $1,000,000 plus 12% of the Purchase Price will be deposited with an escrow agent at the closing of the transaction and will be available to satisfy amounts owed by the Company to Aladdin under the Asset Purchase Agreement in accordance with the terms of an escrow agreement. The Asset Purchase Agreement includes customary representations, warranties and covenants, including covenants requiring the Company to conduct the IAM business in the ordinary course during the interim period between signing and closing, and not to solicit employees or customers from the IAM product line for a period of two years. In addition, the Company has entered into a transition services agreement with Aladdin, pursuant to which the Company will provide certain transitioning services to Aladdin until February 28, 2009, unless terminated earlier, or extended to as late as May 31, 2009, in accordance with the terms of the transition services agreement.

The representations and warranties of each party set forth in the Asset Purchase Agreement have been made solely for the benefit of the other party to the agreement and such representations and warranties should not be relied on by any other person. In addition, such representations and warranties (1) have been qualified by disclosure schedules that the parties have exchanged in connection with the signing of the Asset Purchase Agreement, (2) are subject to the materiality standards set forth in the Asset Purchase Agreement, which may differ from what may be viewed as material by investors and (3) were made only as of the date of the Asset Purchase Agreement or such other date as specified in the Asset Purchase Agreement. Accordingly, no person should rely on the representations and warranties as characterizations of the actual state of facts, as they are modified in important part by those disclosure schedules. Moreover, information concerning the subject matter of the representations and warranties may change after the date of execution of the Asset Purchase Agreement.

Consummation of the transaction is subject to various conditions, including consents of certain of the Company’s contractual counterparties, accuracy of the representations and warranties set forth in the Asset Purchase Agreement, acceptance of employment at Aladdin by certain of the Company’s current employees, and regulatory approval. The transaction is expected to close during the third quarter of 2008.

A copy of the Asset Purchase Agreement is filed as Exhibit 2.1 to this Current Report on Form 8-K and is incorporated herein by reference. The foregoing description of the Asset Purchase Agreement is qualified in its entirety by reference to the full text of the agreement.

A copy of the press release, dated July 30, 2008, announcing the execution of the Asset Purchase Agreement is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

(d) Exhibits.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

EXHIBIT INDEX