Emblaze Systems Ltd announced that it has reached an agreement for the acquisition of all assets and operations of UCnGO Inc. The overall consideration of the acquisition is approximately $3.6 million in a cash and Emblaze shares combination. The acquisition will not have an effect on Emblaze's burn of cash or operational expenses.

UCnGO has developed unique technological capabilities that allow smart media
trans-coding i.e. changing image or media characteristic / compression
attributes when being transported between different types of cell-phones or
other devices. As an example, such capabilities are essential in the Multimedia
Messaging Services (MMS) for adapting images sent from one phone to another
when the two phones do not share identical features (i.e. have different screen
sizes, use different compression methods or support a different number of
colours). Such operations demand very complicated algorithmic image
manipulations and have to be performed in real-time. UCnGO is comprised of top
level specialists with many years of experience in image processing and
manipulation in the space and satellite telecommunication industry.

In addition to the above, UCnGO has developed other MMS related technologies
and has a strategic agreement in place with a leading global MMS provider. The
acquisition will greatly enhance Emblaze's platform offering to carriers and
MMS providers and will further strengthen its leadership in the provision of
rich media delivery solutions over wireless networks.

UCnGO's products & technologies are complementary to the Emblaze solution and
are essential for all types of media transfer services such as MMS and
streaming media, that will be the basis for value added services in the 2.5G
and 3G era. This technology will be embedded throughout the Emblaze Systems
platform and will be used by almost all of its components.

Eli Reifman, Chief Executive Officer of Emblaze said: 'These are difficult
times for the telecom and high-tech industries but on the other hand these
times present great opportunities for companies like Emblaze and UCnGO to join
forces and leverage each other's capabilities. Israel has great technology and
this company represents its finest. We see this acquisition as a strategic move
planned to increase our technological lead over potential competition and an
addition of quality minds to our family. This deal will enable us to offer a
winning combination to the telecom companies for rich media delivery solutions
over next generation networks'.