Crystal to Acquire Controlling Interest in Mainsoft.

HERZLIYA, Israel--(BUSINESS WIRE)--December 13, 1999--

This acquisition significantly increases Crystal's presence in

Windows NT(R), Unix and LINUX markets

Crystal Systems Solutions Ltd., (NASDAQ: CRYS) a leading provider of software renovation solutions, today announced the signing of an agreement to acquire a controlling interest in privately-held Mainsoft Corporation of San Jose, California. Under terms of the agreement, Crystal will invest up to $22.5 million in Mainsoft, with an initial consideration of $10 million in cash. Total consideration for this acquisition may increase upon the fulfillment of certain terms and conditions.

Mainsoft develops and markets a Windows(R) platform for UNIX and LINUX, allowing Windows applications to run natively on UNIX and LINUX systems. Mainsoft enables independent software vendors and enterprise customers to leverage their investment in applications developed for Windows through the generation of native UNIX and LINUX applications. Using Mainsofts Windows platform for UNIX, overall development costs are dramatically reduced and time to market is significantly improved. By agreement with Microsoft, Mainsoft has access to Windows NT(R) and Windows 2000(R) source code.

Mainsoft targets its products to corporate enterprises and Independent Software Vendors (ISV's). Mainsoft's customers include Fortune 500 enterprises as well as major software vendors including Microsoft Corporation, which ported Internet Explorer to UNIX using Mainsoft technology. Other customers include Computer Associates International, Rational Software Corporation, Cadence Design Systems and Bridge Information Technologies Inc.

Crystal's enterprise renovation solutions include platform and data base migration, IT department mergers and language upgrades. Crystal software renovation solutions are all based upon its proprietary software tools and technologies. This agreement will enable Crystal to address customer needs across a wide range of computing platforms, from mainframe through midrange, and work stations. On those platforms the solutions will include operating systems such as MVS, VSE, VMS, UNIX, LINUX and Windows NT.

"With this acquisition Crystal takes a great step toward positioning itself as a specialized cross platform software solutions provider. Our extended capability with multiplatform conversion and migration technologies will address the existing needs of our current and future customers," said Gad Goldstein, Crystal chairman of the board. "As previously announced, Crystal decided to incur additional expenses in order to achieve its new positioning as a leading technology provider. This strategy is currently implemented at both Crystal and Mainsoft, who in the near future plan to incur the required costs to exploit the benefits from the promising opportunities in the market.

These costs include Mainsoft's current restructuring expenses as well as Crystal's management attention and related resources. This acquisition may be dilutive to our earnings in the next few quarters, however, I highly regard the potential of the additional strength of Mainsoft's technologies to Crystal and on the long run we will all benefit from the wide technological span opened due to this transaction."

"I am excited about joining forces with Crystal because I feel that it is not only an excellent fit, it is a synergy in which the result will be far greater than the sum of its parts," said Yaacov Cohen, President of Mainsoft. "By leveraging Crystal's Fortune 1000 customer base, Mainsoft will extend the adoption of its Windows platform for UNIX to the worldwide corporate IT marketplace. In addition I am proud to join a Formula Group company. I trust that its management support and its sound financial backing will enable us to better exploit our outstanding market potential."

About Crystal Systems Solutions

Established in 1987, Crystal Systems Solutions Ltd. (NASDAQ: CRYS) provides software renovation solutions, based on its proprietary technology, for complex conversion and migration projects. Crystal has built its conversion expertise through the successful completion of projects for many prestigious Fortune 1,000 companies, thus establishing its competency and achieving global recognition and presence.

The Crystal renovation methodology consists of several phases, including assessment, conversion and testing. This methodology allows for tailor-made adjustments to the automated process, based on client requests, thus providing cost-effective, customized solutions. Crystal's renovation solutions include platform and database migrations, IT mergers and acquisitions, and language upgrades. They are available for mainframe, midrange and client/server computing platforms. Crystal Systems Solutions is a member of the Formula Group (NASDAQ: FORTY), which is the largest public IT group in Israel.

About Formula

The Formula Group is an international information technology company principally engaged, through its subsidiaries and affiliates, in providing software consulting services developing proprietary software products, and providing computer-based solutions.

Certain statements contained in this release may be deemed forward-looking statements, with respect to plans, projections, or future performance of the Company, the occurrence of which involves certain risks and uncertainties that could cause actual plans to differ materially from these statements. These risks and uncertainties include but are not limited to: market demand for the Company's tools, successful implementation of the Company's tools, competitive factors, the ability to manage the Company's growth, the ability to recruit and retrain additional software personnel and the ability to develop new business lines. All names and trademarks are their owners' property.