Rainbow Lauds House & Senate Approvals of Electronic Signature Bill; New Measure Will Allow Binding eSignatures for Better B2B & B2C e-commerce.

Business Editors and High-Tech Writers

IRVINE, Calif.--(BUSINESS WIRE)--June 27, 2000

New Law Will Accelerate Adoption of Rainbow's iKey and CryptoSwift as

Powerful Security Solutions for eSignatures

Rainbow Technologies (Nasdaq: RNBO), a leading provider of security solutions for the Internet and e-commerce, Tuesday praised the U.S. House of Representatives and the U.S. Senate for overwhelmingly passing new legislation making electronic or digital signatures legally binding.

The company urged President Clinton to sign the E-Sign Act as soon as possible.

The president has said he would sign this historic legislation, which gives electronic contracts and digital signatures the same legal weight as their paper counterparts. The E-Sign Act is a boon for B2C and B2B e-commerce, as it will have a significant impact on the way net transactions and contracts are performed.

Rainbow security engines are key technologies necessary for employing legally binding electronic signatures, with online financial services -- a strong segment for Rainbow -- being one of the first areas affected.

The new law is also expected to increase demand for end-user authentication devices, such as Rainbow's iKey, and Web server security solutions, such as Rainbow's CryptoSwift eCommerce accelerator, according to Walt Straub, president and CEO, Rainbow Technologies.

"By granting e-signatures the same status as handwritten signatures, Congress has eliminated a significant barrier to the continued growth and evolution of e-commerce," said Straub. "We applaud the bipartisan efforts of both the House and the Senate for their work on the E-Sign Act and we urge the president to sign it into law as soon as possible.

"We believe the Act will facilitate an even faster growth of secure transaction rates, increasing demand for both our CryptoSwift eCommerce accelerators and iKey eCommerce and workstation security solutions."

The iKey Advantage for Electronic Identities

Rainbow's iKey is a compact electronic key that is compatible with smart cards but snaps directly into a laptop or desktop PC's existing universal serial bus (USB) port.

Working in conjunction with secure mail protocol (S/MIME) available in popular e-mail programs from Microsoft, Netscape, Lotus, and others, iKey users can write digital signatures to all e-mail messages to clearly identify authenticated messages.

In the case of hacking or malicious e-mail viruses, "spoofed" messages from trusted recipients would show up as unsigned messages, helping recipients to easily identify tainted e-mails and providing an added measure of security for cases of identity theft or hacking.

The iKey provides a reliable, robust security solution that is easy-to-use and administer yet provides an exceptional PKI-based security solution for desktop applications for the Internet, e-commerce, extranets and corporate intranets. Through user identification data contained in each device, network administrators can grant or deny access based on the user's authorization level.

CryptoSwift's Powerful Security

Rainbow's CryptoSwift eCommerce acceleration products are the industry's fastest cryptographic accelerators on the market today. CryptoSwift accelerates the public-key cryptographic functions of SSL, SET, SSH, and other widely used security protocols, enabling as much as 1,000 transactions per second.

CryptoSwift improves server response time for secure connections by up to 90 percent and frees the e-commerce Web server to perform other tasks, especially during peak load and heavy traffic periods, while ensuring that every electronic transaction is a secure one.

About Rainbow Technologies

Founded in 1984, Rainbow Technologies is a leading provider of security solutions for the Internet and e-commerce. Rainbow applies its core technology to a variety of Internet applications -- from securing software, to the acceleration of secure communication for e-commerce and Virtual Private Networks (VPNs).

Rainbow products include secure Web server and VPN acceleration boards; anti-piracy and Internet software distribution solutions; PKI security solutions; voice, data and satellite security systems; and USB-based authentication tokens.

The company has headquarters in Irvine and maintains offices throughout the United States, United Kingdom, France, Germany, Australia, China, India, The Netherlands, Russia, India, and Taiwan. A network of nearly 50 authorized distributors sells Rainbow products worldwide. For more information, visit the company's Web site at www.rainbow.com.

Note to Editor: Rainbow Technologies, iKey, and CryptoSwift are trademarks of Rainbow Technologies.

The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for forward-looking statements. Certain information included in our Annual Report on Form 10-K and other materials filed with the Securities and Exchange Commission ("SEC")(as well as information included in oral statements or other written statements made or to be made by the company) contain statements relating to the following: acquisition strategy, dependence upon existing and new product offerings, competition, patents, intellectual property and licensing, future growth, rapid technological and market change, manufacturing and sourcing risks, Internet infrastructure and regulation, international operations, volatility of stock price, financial risk management and potential volatility in operating results, among others. These conditions involve important factors that could cause actual results to differ materially from those expressed in any forward-looking statements made by or on behalf of the company. Any forward-looking statements are made pursuant to the Private Securities Litigation Reform Act of 1995 and, as such, speak only as of the date made. Statements made in this document that are not purely historical are forward-looking statements, including any statements as to beliefs, plans, expectations, or intentions regarding the future. The company assumes no obligation to update information concerning its expectations.