Exar Corporation Signs Definitive Agreement to Acquire Neterion, Inc.
Combination targets high performance solutions for virtualized data centers.

FREMONT, CA - Exar Corporation (Nasdaq: EXAR) and Neterion, Inc., announced today that they have signed a definitive agreement under which Exar will acquire Neterion, a privately held company based in California. The transaction is expected to close during the current quarter ending in March, 2010.

"The combined capabilities that Exar and Neterion will offer address not only the requirements of today's data centers but enable critical features for the evolving needs of next generation data centers," said Pete Rodriquez, Exar's president and chief executive officer. "Neterion is a recognized leader in 10 Gigabit Ethernet network adapter solutions optimized for virtualized data centers with an array of toptier enterprise server and storage customers. Their product portfolio represents an ideal complement to Exar's market-leading solutions for hardware accelerated data encryption, compression and deduplication."

"We are very excited to be joining the Exar team," said Todd Oseth, Neterion's president and chief executive officer. "Exar's technology portfolio, as well as engineering, marketing, and sales resources, allows a new level of focus on meeting the needs of our customers."

"Today, data centers are tasked with not only expanding their capabilities to meet the demands of more users that have access to more bandwidth and larger data sets, but doing so while managing rising operational costs," said John Williams, Exar's vice president of Datacom and Storage business. "Neterion's hardware optimized 10 Gigabit Ethernet V-NIC adapters provide an optimal platform for IT organizations targeting server consolidation. Exar's Hifn Technology products provide the capabilities to not only secure those virtual partitions, but to optimize network bandwidth utilization with hardware data compression, all of this with negligible impact to server performance and power."

The purchase price is estimated to be between $10 million and $11 million dollars net of cash received. No other terms of the agreement are being disclosed.

About Exar
Exar Corporation delivers highly differentiated silicon, software and subsystem solutions for data communication, storage, consumer and industrial applications. For nearly 40 years, Exar's comprehensive knowledge of end-user markets along with the underlying analog, mixed signal and digital technology has enabled innovative solutions that meet the needs of the evolving connected world. Exar's product portfolio includes power management and interface components, communications products, storage optimization solutions, network security and applied service processors. Exar has locations worldwide providing real-time customer support to drive rapid product development. For more information about Exar, visit: www.exar.com.

About Neterion, Inc.
Neterion is the leader in I/O Virtualization for 10 Gigabit Ethernet adapters that provide high speed solutions for server and storage systems. Xframe® and X3100 Series are the industry's highest performing line of 10 GbE adapters, allowing IT managers to virtualize many more applications per physical server - including the most I/O-intensive ones - drastically decreasing costs when deploying virtualized servers. The company was founded in 2001 and is headquartered in Sunnyvale, California with an additional office in Ottawa, Canada. More information on Neterion, Inc. can be found at www.neterion.com.

The Neterion, Xframe, IOQoS, Hy-O and VLT names and logos and combinations thereof, are trademarks or registered trademarks of Neterion, Inc. All other names are for informational purposes and may be trademarks of their respective owners.



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