Crossroads Systems Teams With Electronic Data Systems, Dell and StorageTek to Deliver World-Class Intranet to United States Navy and Marine Corps.

Business Editors & High-Tech/Military Writers

AUSTIN, Texas--(BUSINESS WIRE)--Sept. 5, 2001

Crossroads Chosen to Participate in $6.9 Billion

Enterprise-Wide Initiative

Crossroads Systems Inc. (Nasdaq:CRDS), a global provider of connectivity for storage solutions, today announced it has been chosen to team with Electronic Data Systems Corp (EDS), Dell and StorageTek, to provide their SAN solution to the United States Navy and Marine Corps intranet initiative.

The Navy Marine Corp Intranet (NMCI) is the largest federal information-technology contract in history with a potential value of more than $6.9 billion. It is a comprehensive, enterprise-wide initiative that will make the full range of network-based information services available to sailors and marines for day-to-day activities and in war. When initial operating capability is achieved by the end of 2001, NMCI will give the Navy and Marine Corps secure, universal access to integrated voice, video and data communications.

The Crossroads 4450 storage router was chosen by StorageTek and Dell to enhance the backup and recovery portion of NMCI's storage networking needs. Crossroads has demonstrated industry-leading functionality and interoperability with both Dell's server capabilities and StorageTek's tape libraries. The existing partnerships and interoperability among the top leaders in storage networking enables them to work together to bring the best solutions to NMCI.

"We are excited to be part of the largest SAN initiative in the industry," said Larry Sanders, president and chief operating officer, Crossroads Systems. "Our selection demonstrates our leading edge technology as a critical component in any SAN solution, and validates Crossroads as the leading provider in storage routing."

About Crossroads Systems Inc.

With headquarters in Austin, Texas, Crossroads Systems (Nasdaq:CRDS) is a leading global provider of connectivity for storage networks regardless of technology or location. Crossroads enables protocol-independent connectivity at gigabit speeds for a wide range of devices that scale for small businesses to global enterprises. Crossroads' products are in solutions from ADIC, ATL, Compaq, Dell, Fujitsu, Siemens, Groupe Bull, Hewlett-Packard, Hitachi Data Systems, IBM, McDATA, StorageTek, Sun Microsystems, Unisys, ACAL, Bell Micro, Cranel/Adexis, Datalink and Tech Data. Crossroads is a voting member of the Storage Networking Industry Association (SNIA). For employment opportunities and more information about Crossroads Systems, please visit www.crossroads.com or call 800/643-7148.

Forward-Looking Statements

This release may contain forward-looking statements that involve risks and uncertainties. Among the important factors that could cause actual results to differ materially from those in the forward-looking statements are: the quarterly fluctuations of Crossroads' operating results and Crossroads' inability to accurately predict revenues and budget for expenses for future periods; the extent of Crossroads' future operating losses and negative cash flow; the company's ability to maintain its operating margins; the impact on Crossroads' results or operations due to changes in the Securities and Exchange Commission's accounting standards, including the implementation of SAB 101 with respect to revenue recognition; the dependence of Crossroads' business on the storage area network market which is evolving and unpredictable; the possibility that the pending shareholder class action lawsuits could result in an adverse outcome to the company; Crossroads' ability to develop new and enhanced products that achieve market acceptance; the effect of competition; the effect of undetected software or hardware errors, which may affect the company's results or reduce demand for Crossroads' products in the long term; Crossroads' inability to protect its intellectual property rights, including any adverse outcome in the company's pending patent litigation with certain of its competitors; the continuation of Crossroads' successful relationships with its limited number of OEM customers, including its ability to replace revenue from Compaq Computer Corporation; Crossroads' ability to retain and recruit key personnel to manage its business successfully; Crossroads' ability to successfully achieve the benefits of the acquisition of Polaris Communications and any subsequent acquisition or strategic relationship; and that Crossroads' stock price could be volatile regardless of Crossroads' actual financial performance and other factors detailed in Crossroads' filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K and Quarterly Reports on 10-Q.