August 15, 2000

“Red Hat Joins Industry Vendors as a Founding Member of the GNOME Foundation

Foundation to Reinforce and Advance GNOME as the World’s Leading Open-source Desktop Environment.

RESEARCH TRIANGLE PARK, N.C.-August 15, 2000-Red Hat, Inc. (Nasdaq:RHAT), the leader in open source Internet infrastructure solutions, today announced it has joined the GNOME project and top industry vendors including Compaq, Eazel, Helix Code, IBM, Sun Microsystems and VA Linux Systems to form the GNOME Foundation, a non-profit, unified group of vendors and individuals dedicated to advancing the use and extending the capabilities of the popular GNOME graphical user environment.

The GNOME (GNU Network Object Modeling Environment) project is an open source, GUI-based user interface for Linux designed to run on all modern versions of UNIX-like operating systems. Since its development, GNOME has quickly become one of the world’s leading, free and simple desktop environments.

Red Hat will assist the GNOME Foundation in leading the technical direction of the continuing GNOME project, offering forums for industry leaders to contribute to GNOME and in promoting the benefits of GNOME. The GNOME Foundation will provide organizational and financial support for GNOME and related open source projects.

“Red Hat has played an integral part in the development of code and support for GNOME,” said Bob Young, chairman and co-founder of Red Hat, Inc. “As one of the key founders of the GNOME Foundation, Red Hat is dedicated to working with others in advancing this powerful application framework and promoting it as the desktop environment of the future.”

About the GNOME Foundation

The GNOME Foundation provides organizational, financial and legal support to the GNOME project. The foundation will help determine the vision and roadmap for GNOME. It will also assist in creating technical standards, coordinate GNOME releases, and determine which software projects are part of GNOME. The foundation will make public statements and administer funds on behalf of the GNOME project. The Foundation will be incorporated as a membership-based, not-for-profit corporation.

You are invited to participate in the GNOME Foundation. We welcome contributions in many forms. Our membership consists of those individuals who have demonstrated a commitment to the development of GNOME through participation in the development, documentation and promotion of GNOME. The Advisory Board provides a vehicle for organizations and companies to communicate with the GNOME community and support GNOME. Additional information is available at: http://www.gnome.org.

Joining Red Hat in the GNOME Foundation is Collab.net, Compaq, Debian, Eazel, Free Software Foundation, Gnumatic, Helix Code, Henzai, Inc., IBM, Sun Microsystems, and VA Linux Systems.

Open source momentum

International Data Corp. (IDC) research states that paid Linux shipments grew faster than any other server operating system over the past two years, and their preliminary figures for 1999 show Linux shipments hold 24.6 percent of the server operating system market, up from 15.8 in 1998. IDC also states that Red Hat Linux is by far the most popular distribution, preferred by 68.7 percent of U.S. Linux users.

Research firm Netcraft, Inc. (www.netcraft.com), states that as of May 2000, 36 percent of all public Web sites run on Linux-based operating systems, making Linux the most popular choice for deploying public Web sites. IDC research shows 40 percent of all spending on Linux servers is for Internet related applications, firmly entrenching Linux servers in the Internet infrastructure.

Finally, IDC predicts that by 2002, there will be more than 55 million handheld and notebook-style information appliance devices and that by 2005, shipments of these appliances will exceed shipments of PCs.

Red Hat’s numerous alliances with industry leaders and the demand for Linux-based applications has created open source support from many of the industry’s leading software and hardware manufacturers, including Compaq, Computer Associates, Dell, Hewlett-Packard, IBM, Intel, Netscape, Novell, Oracle and SAP.

About Red Hat, Inc.

Founded in 1994, Red Hat (Nasdaq:RHAT) is the leading provider of open source Internet infrastructure solutions, ranging from small embedded devices to high availability clusters and Web serving. Red Hat applies its technological leadership to create open source solutions for Internet infrastructure and post-PC environments, offers services backed by the best understanding of open source and the most comprehensive resources, delivers the brand of a widely trusted open source leader and corporate partner, and persists in an indelible commitment to the virtues of open source to lead a revolution in the computing industry.

Red Hat, Inc. is based in Research Triangle Park, N.C. and has offices worldwide. Visit Red Hat on the Web at www.redhat.com. For investor inquiries, contact Lippert/Heilshorn at (212) 838-3777.

Red Hat Europe was established in July 1999 with its European headquarters based in Surrey, United Kingdom and offices throughout Europe.

Forward-looking statements

Forward-looking statements in this press release are made pursuant to the safe harbor provisions of Section 21E of the Securities Exchange Act of 1934. Investors are cautioned that statements in this press release that are not strictly historical statements, including, without limitation, management’s plans and objectives for future operations and management’s assessment of market factors, constitute forward-looking statements which involve risks and uncertainties.These risks and uncertainties include, without limitation, product plans and performance, the ability to continue to develop the Linux kernel and other software, reliance upon strategic relationships, Red Hat’s dependence upon an open source business model, reliance upon independent third-party Linux developers, management of growth, expansion of Red Hat’s business focus and operations, the possibility of undetected software errors, the enforceability of the GNU General Public License and other licenses under which Red Hat’s products are developed and licensed, the scarcity of Linux-based applications, the risks of economic downturns generally, and in Red Hat’s industry specifically, the risks associated with competition and competitive pricing pressures, the viability of the Internet, and other risks detailed in Red Hat’s filings with the Securities and Exchange Commission, copies of which may be accessed through the SEC’s Web site at http://www.sec.gov.