REDMOND, Wash. — May 4, 2006 — Microsoft Corp. today announced it has acquired Vexcel Corp., a worldwide leader in photogrammetry, imagery and remote sensing technologies. Financial details of the acquisition were not disclosed.

This deal, the second in the past six months for Microsoft’s Virtual Earth business unit, was done to enhance the talent, technologies, products and services dedicated to fulfilling Microsoft’s broad vision for best-of-breed local search and mapping solutions for consumers, businesses and government.

Founded in 1985, Vexcel is a multinational company with its headquarters in Boulder, Colo., and offices in Austria, Canada, the Netherlands and the United Kingdom. Vexcel employees become Microsoft employees and will be part of Microsoft’s Virtual Earth business unit.

“Delivering best-of-breed local search and mapping offerings to consumers, businesses and government customers will depend on providing a rich, immersive and dynamic experience that mirrors what can be experienced in the real world,” said Stephen Lawler, general manager of the Virtual Earth business unit at Microsoft. “Aligning Vexcel’s talent, expertise, products and services with our vision, resources and offerings will enable us to deliver on our vision better than ever before.”

Vexcel’s extensive experience in imagery, 2-D and 3-D will enable rich sets of aerial, bird’s-eye and street-side imagery to be delivered in consumer, commercial and government offerings in a much easier and timely fashion. Vexcel’s people and technology will also play a central role in enabling Virtual Earth to support the dynamic contribution of information from consumers, businesses, governments and others that will strengthen the overall usefulness and platform and the ways in which it will be used in the future.

In addition, Vexcel’s current assets, including the Ultra-Cam and remote sensing technologies, will help produce the richest, most dynamic sets of imagery and data in the world, which will be integrated into Windows Live™ Local and the Virtual Earth™ platform offerings.

Founded in 1975, Microsoft (Nasdaq “MSFT”) is the worldwide leader in software, services and solutions that help people and businesses realize their full potential.

Microsoft, Virtual Earth and Windows Live are either registered trademarks or trademarks of Microsoft Corp. in the United States and/or other countries.

The names of actual companies and products mentioned herein may be the trademarks of their respective owners.