Dear Customer,

Today, ILOG and IBM announced that they have signed an agreement under which IBM will launch a cash tender offer for all outstanding shares of ILOG.

ILOG management supports this move and we expect it to be very beneficial for customers. If the tender offer is successful and the acquisition proceeds, ILOG will become part of a much larger, well-resourced organization. IBM’s increasing focus on software, deep R&D, global reach, substantial professional services, sales resources, and commitment to technical excellence will provide great benefits for ILOG customers.

ILOG management also believes this move offers us a great opportunity to accelerate our vision. Our BRMS and visualization technologies are an essential complement to their BPM and SOA software offering. Our optimization software complements IBM’s strategy for Business Optimization. Our SCM products complement IBM’s Global Business Services (GBS) offering in Supply Chain Management. Being part of IBM will allow us to extend our market reach and geographic coverage. Further, IBM is also ILOG’s biggest partner and customer and we already have a close technical and sales partnership – we know that we can work together and we share similar values.

We expect the acquisition to close in December 2008.  It is important to note that ILOG remains independent until the acquisition closes. Your contacts with us remain the same. We will advise you as soon as possible of any changes.

Please feel free to contact me or your ILOG account manager if you have any further questions or concerns.

Sincerely,
Pierre Haren