update software AG Submits Irrevocable Offer to Purchase 100% of REGWARE GmbH; update Bundles Sector Expertise in New International Competence Center Healthcare

update software AG, a leading European CRM solutionsprovider with its head office in Vienna, seeks to acquire 100% of theGerman REGWARE GmbH. update software Germany GmbH, a wholly ownedsubsidiary of update software AG, which in turn is listed on theFrankfurt Stock Exchange, has submitted an offer to this effect.REGWARE, headquartered in Germering near Munich, was founded in 1988and is one of Germany's best-known specialists for operative andanalytical CRM in the healthcare sector. REGWARE has an internationalclient base, notably in the pharmaceuticals, medical technology anddental medicine sectors. Through this acquisition, update intends tofoster its leading position as CRM supplier in the European healthcaremarket by broadening the client base, exploiting synergies within theproduct portfolio and strengthening the competence team. AnInternational Competence Center Healthcare (ICCH) is to be establishedin Germering near Munich by merging the respective teams of the twocompanies to bundle the CRM expertise of update and REGWARE in thehealthcare sector. The installed REGWARE CRM solutions will besupported up to at least 2008, medium-term integration of both CRMsystems is planned. Regarding the purchase price both companies haveagreed to maintain secrecy.

Thomas Deutschmann, CEO of update software AG, explains thereasons for the planned purchase: "The takeover of REGWARE will be afurther milestone in our ongoing growth strategy. With thisacquisition we are actively participating in the consolidation of theCRM market. Our new International Competence Center Healthcare willconstitute an important element in the strategic concentration on ourcore vertical markets. We will also be taking similar steps in othervertical markets in 2006."

Claus Droemer and Klaus Kohlbauer, the founders, managers andowners of REGWARE, emphasize the advantages a merger entails for bothcompanies: "The acquisition will provide a wider range of services toour customers and a higher support level on an international basis,"says Claus Droemer. Klaus Kohlbauer adds: "update is a strong partnerand a highly experienced and international CRM specialist that canguarantee our clients stability and future security. This enables usto assure greater benefit for our clients in the long term."

About REGWARE GmbH

Headquartered in Germering near Munich, REGWARE (www.regware.de)was founded in 1988 and has since been run by the company's twomanagers and owners, Claus Droemer and Klaus Kohlbauer. REGWARE ranksamong the best-known German specialists for CRM solutions in thehealthcare sector, and services an international client base above allin pharmaceuticals, medical technology and dental medicine.

The product portfolio of REGWARE comprises the operative CRMsolutions REGMED(R) and REGIND(R), REGSTAT for analytical CRM and thecontrolling instrument REGCS. REGWARE supplies all the components fora completely integrated CRM solution from one source, and supports andadvises clients from the planning stage through implementation andcustomizing to training and servicing.

About update software AG

With nearly 150 employees and sales of EUR 15.3 million (2004),update software AG (www.update.com) is the leading European providerof CRM solutions. The company was founded in 1988 in Vienna, Austria,and is listed on the German stock exchange in Frankfurt am Main. Ithas subsidiaries in Germany, Switzerland, the Netherlands, France,Hungary, the Czech Republic, and now also in Poland.

update's products are currently used by over 80.000 people in morethan 750 companies. Among update's customers are 3M, Astra Zeneca,Beiersdorf, Canon, DuPont, ESTAG, Imperial Tobacco, LBS Nord,Landesbank Rheinland-Pfalz International S.A., Magna Steyr and PernodRicard. The company also maintains strategic partnerships with systemintegrators such as Siemens SBS, IDS-Scheer Austria, EDS, Cognos,Dendrite International, Softlab and Atos Origin.