Microsoft and LG Electronics Announce Broad Patent-Licensing Agreement

REDMOND, Wash., and SEOUL, South Korea — June 6, 2007 — Microsoft Corp. and LG Electronics (LGE) today announced that they have entered into a patent cross-license agreement to further the development of the companies’ current and future product lines. Microsoft has focused on patent agreements in the recent past to develop a best-practices model for protecting intellectual property (IP) and respecting the IP rights of others, as well as building bridges with an array of industry leaders, including consumer electronics, telecommunications and computer hardware providers.

Through the agreement, LGE will be able to use Microsoft®-patented innovations in its products, including Linux-based embedded devices. Microsoft will have access to LGE’s patents and will license other patents developed by LGE that are now owned by business solutions provider MicroConnect Group. The specific financial terms of the agreement are confidential, but the parties are disclosing that Microsoft will be making a net balancing payment to LGE and MicroConnect for patents related to operating systems and computer systems. LGE will be making ongoing payments to Microsoft for the value of Microsoft patents as they relate to Linux-based embedded devices that LGE produces.

“This agreement and our good relationship with Microsoft enable LGE to provide improved telecommunications solutions to our customers,” said Jeong Hwan Lee, executive vice president of the Intellectual Property Center at LGE. “We believe that the license arrangement with Microsoft provides appropriate recognition of the value of LGE’s computer system-related patents, which includes patents directed to computer architecture utilized in game consoles and other products. We believe in the importance of respecting the IP rights of others and that patent collaboration and protection is a best business practice the whole industry should be engaged in.”

“MicroConnect is pleased to be able to make a contribution to the strengthened IP relationship between LGE and Microsoft,” said Alan Loudermilk, founding partner of MicroConnect.

“This agreement is another example of how Microsoft is continuing to build bridges with others in the industry through intellectual property licensing,” said Horacio Gutierrez, vice president, Intellectual Property and Licensing at Microsoft. “We are pleased to be working with an industry leader and partner like LGE to meet our mutual business goals and customer needs.”

In the past 12 months, Microsoft has announced similar agreements with companies such as Fuji Xerox Co. Ltd., NEC Corp., Nortel Networks, Novell Inc., Samsung and Seiko Epson Corp. to help build bridges between the world’s leading computer hardware, software and telecommunications solutions providers.

About LG Electronics, Inc.

LG Electronics, Inc. (KSE: 066570.KS) is a global leader and technology innovator in consumer electronics, home appliances and mobile communications, employing more than 82,000 people working in over 110 operations including 81 subsidiaries around the world. Comprising four business units — Mobile Communications, Digital Appliance, Digital Display and Digital Media with 2006 global sales of US $38.5 billion — LG Electronics is the world’s

largest producer of CDMA handsets, air conditioners, optical storage products, DVD players. For more information, please visit www.lge.com.

LG Electronics Digital Media Company is a leading producer of DVD players and home theater systems. It has been the world’s best-selling optical storage maker for 9 consecutive years. The company provides digitally integrated products such as audio-video systems, car infotainment, optical storage products, notebook PCs, and PDAs, and is focusing on next-generation businesses.

About Microsoft

Founded in 1975, Microsoft (Nasdaq “MSFT”) is the worldwide leader in software, services and solutions that help people and businesses realize their full potential.

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