January 10, 2025 RED HAT COMPLETES CYGNUS AND HKS ACQUISITONS TO CREATE GLOBAL OPEN SOURCE POWERHOUSE Combines Internet, Server, and Post-PC Technology Leaders for a Complete Solution Spanning Powerful Servers, Internet Software and Handheld Devices Red Hat, the market leader in open source solutions, announced the completion of the acquisitions of privately-held Cygnus Solutions and Hell's Kitchen Systems, Inc. (HKS). The Cygnus transaction, to be accounted for as a pooling of interest, was completed in a stock for stock merger in which Red Hat issued up to 6,624,344 shares for all outstanding securities of Cygnus. Red Hat will issue up to 398,335 shares for all the outstanding shares of HKS in a transaction to be accounted for under the purchase method of accounting. Matthew Szulik, the president and CEO of Red Hat, leads the combined companies. "The addition of Cygnus and HKS to the Red Hat family creates a next-generation software company for the 21st century, spanning powerful servers, Internet infrastructure and pervasive, post-PC-centric computing platforms," said Matthew Szulik, President and CEO of Red Hat. "Red Hat is now positioned as a complete worldwide source for companies rapidly creating and deploying Linux and open source applications for servers and small devices." The acquisitions make Red Hat, Inc. the largest company in the world dedicated to providing open source technology, information and services, offering the full spectrum of open source software and support from enterprise server and e-commerce deployments to embedded and handheld platforms. End users worldwide benefit from the companies' combined, unmatched technical expertise and a wide-array of industry partnerships with major computing vendors like Compaq, Dell, IBM, Intel and Hewlett-Packard to support their rapidly-growing adoption of open source solutions. The combined entity remains committed to serving the customers of each company. For more information on Cygnus and HKS, visit www.Redhat.com. Open Source, Internet and Handheld Market 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. IDC also 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. (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. About Red Hat, Inc. Founded in 1994, Red Hat (NASDAQ: RHAT) is a market leader in open source operating system (OS) software, services and information. 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 programmes and priority access updates, making Red Hat a leading resource for knowledgeable, innovative, mission-critical open source solutions. Red Hat shares all of its software innovations freely with the open source community under the GNU General Public License (GPL). The Official Red Hat Linux OS and related services are available directly from the company and through its partner, distributor and reseller programmes, which include top PC and server manufacturers such as Compaq, Dell, Gateway, IBM, Hewlett-Packard and Silicon Graphics. Red Hat Europe was established in July 1999 with its European headquarters based in Surrey, United Kingdom and offices throughout Europe. Red Hat Linux is sold and supported through a number of major distribution and industry partners throughout Europe. Red Hat and the Official Red Hat Linux OS have received industry praise. Recent accolades include: Red Herring's Top 100 Companies of the Electronic Economy, Upside's Hot 100 Companies, Network World's 10 Companies to Watch, Federal Computer Week's Government Best Buy, Software Development?s Jolt Award and InfoWorld's Product of the Year for three years in a row. Red Hat was also voted a "LinuxWorld Favorite" by the attendees of the two most recent LinuxWorld Expos, winning Best Server Distribution at the August show. Red Hat is based in Durham, N.C. and has offices worldwide. Visit Red Hat on the Web at www.redhat.com. For investor inquiries, contact Lippert/Heilshorn at (212) 838-3777. # # # 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. 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. For further information please contact Fiona Phelps Red Hat phone: +44 (0)1483 300 169 email: fphelps@redhat.com