Microsoft to Acquire Whale Communications, a Leading Provider of SSL VPN and Application Security Technologies

REDMOND, Wash. — May 18, 2006 — Microsoft Corp. today announced that it has signed a definitive agreement to acquire Whale Communications Ltd., a leading provider of secure access products, including secure sockets layer (SSL) virtual private networks (VPN) and Web application firewalls. Whale’s solutions provide remote access, deep content inspection and granular access control, enabling businesses to protect corporate applications and data when accessed remotely by mobile workers, partners and customers. The acquisition will give Microsoft’s customers a broader range of choices for providing secure access from more locations and devices.

“Our customers are faced with balancing the need to protect their data and network infrastructure with the connectivity needs of an increasingly mobile work force,” said Ted Kummert, corporate vice president of the Security, Access and Solutions Division at Microsoft. “We are committed to providing a comprehensive secure access platform that helps customers easily extend and manage the reach of their information systems. The acquisition of Whale’s complementary technologies is a key part of meeting that commitment. Whale is a pioneer in Windows®-based SSL VPN and Web application firewalls that help protect and provide more secure access to high-value business applications while tightly integrating with critical IT infrastructure.”

Whale’s Intelligent Application Gateway and Application Optimizers will add complementary SSL VPN and comprehensive application-layer filtering capabilities to Microsoft’s existing secure access solutions built around Microsoft® Windows Server™ and Microsoft Internet Security and Acceleration Server (ISA Server), which provide site-to-site and remote access VPN and application publishing. Together, these technologies offer remote workers simplified access from more locations and a broader range of managed and unmanaged devices, including PCs, Internet kiosks and mobile devices. When used with Windows services such as Active Directory®, the solution enables IT administrators to better control and enforce information usage guidelines through customized policies based on device, user, application or other business criteria.

“We built our company and technologies around the key customer requirement of secure, anywhere, anytime remote access to business applications,” said Roger Pilc, CEO of Whale Communications. “We’re excited about what this acquisition will mean for our customers given Microsoft’s focus on providing policy-based secure access to information assets from beyond the corporate network.”

“Enterprises, both large and small, are looking for easier, more flexible, secure remote access options,” said Charles Kolodgy, research director for the Security Products program at IDC. “This acquisition means customers will have a compelling offering from Microsoft that brings together the benefits of application protection, platform integration and broad access.”

Whale Communications will maintain all current operations until the transaction closes.

About Whale

Whale is a leading provider of business-driven secure access products, including SSL VPN, application security and endpoint security offerings. A pioneer in secure application layer access, Whale offers products that are deployed globally by the world’s leading organizations to extend their businesses. Today over 2 million employees, business partners and customer users securely and easily access their critical business applications and resources through Whale’s Intelligent Application Gateway products. The company is headquartered in Fort Lee, N.J., and has international offices in Germany, the United Kingdom, the Netherlands and Israel, and representation in France.

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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