Red Hat Enterprise Edition Product Line Optimizes Solutions for Top e-Business Applications

RESEARCH TRIANGLE PARK, N.C.—February 22, 2000—Red Hat, Inc. (NASDAQ: RHAT), the market leader in Linux and open source solutions, today unveiled the Red Hat Linux Enterprise Edition Product Line. As part of its enterprise product strategy, Red Hat is working in conjunction with top software vendors to provide tested and integrated total Red Hat Linux solutions for business critical, high-volume, e-business and enterprise environments. Under the Red Hat Enterprise initiative, Red Hat recently announced the Red Hat Linux Enterprise Edition for Oracle 8i, Red Hat Linux Enterprise Edition for Computer Associates® systems and storage management solutions and Red Hat Linux Enterprise Edition for SAP R/3. Future Enterprise Editions will target other key application segments critical to enterprise computing and e-business, including directory services, messaging and ERP. The Red Hat Linux Enterprise Edition product line features enterprise-class support from Red Hat's worldwide support and solutions centers.

The Red Hat Linux Enterprise Edition product line is a collaborative effort between Red Hat and industry leading application providers designed to deliver optimized solutions, incorporating support and simplified configuration of well-known enterprise and Internet applications, to enterprise customers. Open Source development enables Red Hat and its enterprise applications partners to work together at the deepest levels of the operating systems to develop a unified enterprise platform. Red Hat and its partners then work together to produce a tested, integrated and configured enterprise solution that assures maximum reliability, performance and availability.

Collaborative services and support that capitalize on the expertise of Red Hat and the enterprise application provider will facilitate the use and support of Red Hat Enterprise Editions in mission-critical enterprise environments.

In keeping with its commitment to open source and the open source development community, Red Hat will continue to freely share all modifications to the Linux OS with the open source community under public licenses.

"The Red Hat Linux Enterprise Edition product line focuses on the configuration, integration, tuning, and reliability issues that are critical to enterprise customers today," said Matthew Szulik, president and CEO of Red Hat, Inc. "We believe that the combination of Red Hat's technical leadership in the Linux development community and our partnerships with companies offering leading enterprise applications will enable Red Hat to deliver the best Linux platform for Linux customers."

"Our customers are increasingly choosing Red Hat Linux for its powerful performance, reliability and flexibility," said Ken Farber, senior vice president worldwide alliances, Computer Associates. "By working with Red Hat, the leading Linux brand, our joint customers benefit from combined efforts to deliver the most robust, powerful e-business solutions for the Linux platform."

"Red Hat's Enterprise edition offers customers the flexibility to build custom solution stacks on Red Hat Linux, the most popular Linux distribution, and Dell PowerEdge servers, the No. 2 PC server in the world," said Michael Lambert, senior vice president of Dell's Enterprise Systems Group. "As a leading provider of servers for the Internet infrastructure, we support strategic initiatives that allow our customers to customize and optimize their computing centers for the new Internet economy."

"Our studies show that although Linux is new to the majority of IT managers, they are open to using Linux-based solutions." said Dan Kusnetzky, program director, operating environments and serverware, IDC. "They are interested in the many strengths open source software offers but have some concerns about applications, tools, middleware, serverware, and support. The Red Hat Linux Enterprise Edition product line has the potential of reducing some of these concerns and is likely to accelerate the adoption of Linux."

Pricing and Availability

The Red Hat Linux Enterprise Edition will support solutions for eBusiness, production database applications, systems and storage management, enterprise application servers, directory services, messaging and ERP. Subsequent Red Hat Linux Enterprise Editions will be announced in coming months. The pricing of the packages will vary, depending on the application and the service and support packages chosen by customers. See www.redhat.com or call 800-454-5502, x500 for more information.

About Red Hat Services

Red Hat's on-site consulting sets a new standard for enterprise-level support for Linux-based operating systems. With more than 350 expert consultants, Red Hat and its partners offer Red Hat Linux consulting services, including: on-site consulting; strategy formation; planning; evaluation; classification and organization; training; implementation; recurring operations and audit. Red Hat Linux-based enterprise IT operations can choose anything from initial installation help up to full, ongoing outsourced management of their complete Linux-based information management operation. Red Hat offers all the services needed to successfully install, integrate, manage and support open source solutions in today's rapidly growing enterprises. In recent months, Red Hat has greatly expanded its support offerings, including international training and certification for Red Hat Linux. In addition, Red Hat announced recently that enterprises such as Burlington Coat Factory Warehouse Corporation, Autozone and Amerada Hess have purchased support services from Red Hat for their Linux deployment.

Open Source Momentum

International Data Corp. (IDC) research states that Linux was the fastest-growing server operating environment in 1998, growing more than 190 percent in that year alone and capturing more than 15.8 percent of the 4.4 million revenue shipment server operating systems market segment. Additionally, IDC states that Red Hat Linux is by far the most popular distribution, preferred by 68.7 percent of U.S. Linux users.

According to research firm NetCraft, Inc. (http://www.netcraft.com/), 29 percent of all public Web servers run on Linux, making Linux the most popular operating system for public Web sites. Finally, IDC predicts that by 2002, there will be more than 55 million handheld and notebook-style information appliance devices and that by 2005, shipments of these appliances will exceed shipments of PCs.

Red Hat's numerous alliances with industry leaders and the demand for Linux-based applications has created open source support from many of the industry's leading software and hardware manufacturers, including Compaq, Computer Associates, Corel, Dell, Hewlett-Packard, IBM, Intel, Netscape, Novell, Oracle and SAP.

About Red Hat, Inc.

Founded in 1994, Red Hat (NASDAQ: RHAT) is the market leader in open source operating system (OS) software, services and information, spanning powerful enterprise and Internet servers to next-generation devices and pervasive computing platforms. Along with its award-winning open source Red Hat Linux OS, Red Hat offers a full line of services, including telephone support, on-site consulting, developer training, certification programs and priority access updates, making Red Hat a leading resource for knowledgeable, innovative, mission-critical open source solutions.

Red Hat develops and shares all of its software innovations freely with the open source community under the GNU General Public License (GPL) and other public licenses. The Official Red Hat Linux OS and related services are available directly from the company and through its partner, distributor and reseller programs, which include top PC and server manufacturers such as Compaq, Dell, Gateway, IBM, Hewlett-Packard and Silicon Graphics.

Red Hat and the Official Red Hat Linux OS have received substantial industry praise. Recent accolades include: Red Herring's Top 100 Companies of the Electronic Economy, Network World's 10 Companies to Watch, Federal Computer Week's Government Best Buy, Software Development's Jolt Award, Information Week's Product of the Year, an Upside Hot 100 Company and E-biz Winner, and InfoWorld's Product of the Year four years in a row. Red Hat is based in Research Triangle Park, N.C. and has offices worldwide. Visit Red Hat on the Web at http://www.redhat.com/. For investor inquiries, contact Lippert/Heilshorn at (212) 838-3777.

Forward-Looking Statements

Forward-looking statements in this press release are made pursuant to the safe harbor provisions of Section 21E of the Securities Exchange Act of 1934. Investors are cautioned that statements in this press release that are not strictly historical statements, including, without limitation, statements regarding product plans and performance, management's plans and objectives for future operations, and management's assessment of market factors, constitute forward-looking statements which involve risks and uncertainties. These risks and uncertainties include, without limitation, Red Hat's ability to continue to develop its product and services offerings, Red Hat's dependence upon an open source business model, reliance upon independent third-party Linux developers, management of growth, reliance upon strategic relationships, expansion of Red Hat's business focus and operations, the possibility of undetected software errors, the enforceability of the GNU General Public License and other licenses under which Red Hat's products are developed and licensed, the scarcity of Linux-based applications, the risks of economic downturns generally, and in Red Hat's industry specifically, the risks associated with competition and competitive pricing pressures, the viability of the Internet, year 2000 compliance efforts of Red Hat and of third parties on which Red Hat depends, and other risks detailed in Red Hat's filings with the Securities and Exchange Commission, copies of which may be accessed through the SEC's web site at http://www.sec.gov/.
LINUX is a trademark of Linus Torvalds. RED HAT is a registered trademark of Red Hat, Inc. All other names and trademarks are the property of their respective owners.