Turbolinux Signs Global OEM Distribution Contract with Compaq

Oracle OpenWorld Announcement Builds on Turbolinux and Compaq Global Services Agreement to Add Factory Installation, Product Bundling, and Initiatives in Engineering, Marketing and Sales

TOKYO and SAN FRANCISCO, December 14, 2000 - Turbolinux, Inc., the leader in high-performance Linux for Internet infrastructure solutions, today announced at Oracle OpenWorld in Japan a global OEM distribution agreement with Compaq Computer Corporation to provide Turbolinux as a bundled or factory-installed option with certain models of Compaq ProLiant™ industry-standard servers. The agreement also permits Compaq to bundle and pre-install Turbolinux software on AlphaServer and AlphaStation systems.

"Compaq is the market leader in Linux server shipments and we saw an excellent opportunity to partner with them in delivering Turbolinux-based Internet infrastructure solutions," said T. Paul Thomas, President and CEO of Turbolinux. "Offering Turbolinux on Compaq's server and workstation platforms with partners such as Oracle gives our customers high-performance computing solutions for the enterprise and e-business. Many of our customers, especially in Asia, have deployed Compaq, Oracle and Turbolinux as Internet building blocks to solve their business problems."

Under the agreement, Compaq later this month will ship Turbolinux pre-installed on selected ProLiant servers in Japan and will offer Turbolinux to its North America customers in the first quarter of 2001.

"Compaq provides optimized server and workstation platforms that make it easy for our customers to implement their Linux solutions," said Gary Campbell, Vice President and Chief Technical Officer, Enterprise Servers, Compaq Computer Corp. "In addition, the Turbolinux operating system, tested on Oracle8i and running on Compaq ProLiant server platforms, will offer new levels of performance and reliability to meet the computing needs of our customers worldwide. Compaq will leverage the strength of our relationships with Turbolinux and Oracle to continue leading the industry in delivering enterprise-ready solutions for this emerging market."

"Oracle is committed to providing our customers enterprise-class solutions on Linux," said Juan Jones, Vice President, Systems Platform Division, Oracle. "Our database and application solutions for Linux allow our customers to leverage the scalability and reliability of Compaq ProLiant server platforms and the speed and performance of Turbolinux with its operating system tuned for Oracle solutions."

Turbolinux has scores of enterprise customers in Asia who have implemented Compaq ProLiant and Oracle e-business solutions, including the Web site hosting the Sydney 2000 Olympics Webcast in China, the Chinese Ministry of Information Industries, the Postal Ministry in China and Fujisoft/ABC's payroll ERP system in Japan.

In addition, Turbolinux and Compaq are also launching new sales, marketing and engineering initiatives that include:

Compaq acquired an equity stake in Turbolinux that was announced in January 2000. In June 2000 the two companies entered into a worldwide services and support agreement.

About Turbolinux, Inc.

Founded in 1992, Turbolinux develops Linux-based software solutions for Internet and enterprise computing infrastructure, including reliable, available and scalable operating systems for workstations and servers and software clustering solutions for computing traffic management and peer-to-peer distributed computing. Backed by more than $95 million in investments from some of the world's leading technology companies, including Compaq, Dell, Fujitsu, Hitachi, IBM, Intel, NEC, Novell, Oracle, SGI and Toshiba, Turbolinux is headquartered near San Francisco with offices around the world. For more information, visit the Turbolinux Web site at http://www.turbolinux.com/.

Company Background

Compaq Computer Corporation, a Fortune Global 100 company, is the largest supplier of computing systems in the world. Compaq designs, develops, manufactures, and markets hardware, software, solutions, and services, including industry-leading enterprise computing solutions, fault-tolerant business-critical solutions, and communications products, commercial desktop and portable products, and consumer PCs.

Compaq products and services are sold in more than 200 countries directly to businesses, through a network of authorized Compaq marketing partners, and directly to businesses and consumers through Compaq's e-commerce Web site at http://www.compaq.com/. Compaq markets its products and services primarily to customers from the business, home, government, and education sectors. Customer support and information about Compaq and its products and services are available at http://www.compaq.com/.


Compaq and the Compaq logo Registered U.S. Patent and Trademark Office. Product names mentioned herein may be trademarks and/or registered trademarks of their respective companies. This press release may contain forward-looking statements based on current expectations that involve a number of risks and uncertainties. The potential risks and uncertainties that could cause actual results to differ materially include: component shortages, delays in the implementation of changes in delivery models, increased competitive environment and pricing pressures, delays in product rollout schedules, slow acceptance for new form factors, employee retention, disruptions related to restructuring actions, the financial condition of resellers, delays in new systems implementation, operational inefficiencies related to sales cycles, equity investment volatility, and emerging market political or economic instability. Further information on the factors that could affect Compaq's financial results is included in Compaq's Securities and Exchange Commission (SEC) filings, including the latest Annual Report on Form 10-K and the latest quarterly report on Form 10-Q.