Jan 07, 2002

VeriSign to Acquire H.O. Systems

Acquisition Expands VeriSign’s Illuminet Portfolio of Telecommunication Services by Adding End-to-End Billing and CRM Applications for Wireless Carriers

Mountain View, Ca., January 7, 2002 – VeriSign, Inc., (NASDAQ: VRSN), the leading provider of digital trust services, today announced it has entered into a definitive agreement to acquire H.O. Systems, Inc., a leading provider of billing and customer care solutions to wireless carriers. H.O. Systems’ advanced billing platform combined with the signaling, intelligent network and clearing services of VeriSign’s Illuminet Holdings, Inc. subsidiary will give wireless carriers a comprehensive package of essential services needed to succeed and grow in a highly competitive marketplace.

H.O. Systems’ core product, speedSUITE, is a highly flexible, integrated, end-to-end billing and Customer Relationship Management service designed to assist wireless carriers by targeting and supporting each stage of the subscriber cycle from initiation through retention. The functionality of speedSUITE supports current 2G and 2.5G service offerings and lays the groundwork for the introduction of next generation (3G+) services. H.O. Systems has numerous independent wireless carrier customers, including affiliates of AT&T.

H.O. Systems’ billing and CRM services complement Illuminet, which operates the largest independent SS7 network in North America, providing signaling, intelligent network and clearing services to more than 900 carrier customers in 23 countries. Illuminet’s network enables call control across carrier networks and delivery of other essential telecommunications services such as seamless roaming, fraud management, toll-free database services, calling name and local number portability. Illuminet also provides roaming and real-time account management for prepaid wireless service, and a host of OSS interconnection and network management services.

“As demand for wireless communications grows, so does the need for services that combine the wireless voice and data and billing functions. The combination of Illuminet’s services and trusted expertise with H.O. Systems’ wireless billing and real-time provisioning systems creates a powerful offering for wireless carriers,” said Terry Kremian, Executive Vice President and General Manager of Illuminet.

“The blending of our cultures and technologies creates a powerhouse in the wireless market,” said Hart Williford, President, H. O. Systems, Inc. “Our combined product vision will accelerate our capabilities to serve our clients with state-of-the-art mobile Internet and m-commerce solutions."

Under the terms of the agreement, VeriSign will pay approximately $340 million in stock and cash for the stock of H.O. Systems. This acquisition will be accounted for as a purchase transaction and is expected to be completed by the end of the first quarter of fiscal year 2002. VeriSign expects the acquisition to be neutral to slightly accretive to its fiscal 2002 earnings. VeriSign will offer revenue guidance upon closing of the acquisition. The acquisition has been approved by the board of directors of each company and is subject to various closing conditions, including approval under the Hart-Scott-Rodino Antitrust Improvements Act.

In addition to immediately augmenting Illuminet’s wireless services portfolio, H.O. Systems adds several opportunities for synergies including expansion of VeriSign’s payments gateway by combining VeriSign’s payments gateway with H.O. Systems’ speedBILL electronic bill payment infrastructure for wireless carriers. VeriSign’s payment platform already services more than 56,000 merchants.

Founded in 1988, H.O. Systems has approximately 300 employees based primarily in Savannah. Williford leads an experienced team that includes approximately 170 product developers and programmers.

Additional information on H.O. Systems is available at www.hosystems.com.

About H.O. Systems

H.O. Systems is a leading next generation communication applications provider. SpeedSUITE, H.O. Systems’ core product, is a highly functional billing and Customer Relationship Management system designed specifically to meet the needs of wireless carriers. Its flexible, scalable and integrated system design allows carriers to provide accurate and efficient billing, quickly respond to changing market conditions and maximize the value of every customer interaction. Based in Savannah, Georgia, H.O. Systems is a subsidiary of LiveWire Corporation.

About LiveWire

LiveWire is an investment and management group organized in 1998 by Steven Price and Stuart Rosenstein and is based in White Plains, New York. LiveWire’s other companies include Encoda Systems, the leading global provider of traffic management and other business software and systems to television, cable, satellite, advertising and radio customers, and Orcom Solutions, a leading provider of outsourced billing and customer care software and services to the utility and energy industries. LiveWire’s outside investors include Thomas H. Lee Company, Blackstone Capital Partners III, an affiliate of the Blackstone Group, Spectrum Equity Investors, Alpine Equity Partners, Nassau Capital Partners, and Waller-Sutton Media Partners.

About VeriSign

VeriSign, Inc. (Nasdaq:VRSN) is the leading provider of digital trust services that enable everyone, everywhere to engage in commerce and communications with confidence. VeriSign's digital trust services create a trusted environment through three core offerings - name, authentication and payment services - powered by a global infrastructure that manages more than five billion network connections and transactions a day. Additional news and information about the company is available at www.verisign.com.

Statements in this announcement other than historical data and information constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements involve risks and uncertainties that could cause VeriSign's actual results to differ materially from those stated or implied by such forward-looking statements. The potential risks and uncertainties include, among others: VeriSign's limited operating history under its current business structure; the risk that the VeriSign and Illuminet businesses will not be integrated successfully and unanticipated costs of such integration; uncertainty of future revenue and profitability and potential fluctuations in quarterly operating results; failure of the combined company to retain and hire key executives, technical personnel and other employees; failure of the combined company to manage its growth and the difficulty of successfully managing a larger, more geographically dispersed organization; failure of the combined company to successfully manage relationships with customers, suppliers and strategic customers; network outages, network capacity constraints or security breaches; failure of the combined company's customers to accept new services or to continue using the products and services of the combined company; and competition in the various markets serviced by the combined company. More information about potential factors that could affect the company's business and financial results is included in VeriSign's filings with the Securities and Exchange Commission, especially in the company's Annual Report on Form 10-K for the year ended December 31, 2000, Registration Statement on Form S-4 filed on October 10, 2001 and Quarterly Reports on Form 10-Q for the quarters ended March 31, June 30, 2001 and September 30, 2001. VeriSign undertakes no obligation to update any of the forward-looking statements after the date of this press release.

VeriSign is a registered trademark of VeriSign, Inc. Other names may be trademarks of their respective owners