BackWeb Provides Preliminary Q4 Results Showing Sequential Improvement and Provides Update on Transfer of Trading of Its Ordinar

  
    
  
  
    
      BackWeb Technologies Ltd. (NASDAQ: BWEB), a leading provider of software 
      designed to provide unplugged access to enterprise web applications, 
      today provided its preliminary, unaudited operating results for the 
      fourth quarter ended December 31, 2006 and also updated shareholders on 
      its previously announced delisting from the Nasdaq Capital Market, due 
      to take effect later this month. The delisting is the result of a change 
      in NASDAQ’s application of its continued 
      listing requirements for non-U.S. companies. The Company is seeking to 
      have the trading of its shares transferred to the OTC Bulletin Board 
      where it is expected the shares would continue to trade under the BWEB 
      symbol.
    
    
      Q4 2006 Preliminary Results
    
    
      For the fourth quarter of 2006, BackWeb’s 
      financial performance improved from that of Q3 2006. The following table 
      highlights the company’s preliminary results 
      for Q4 2006 as well as the actual results for Q3 2006 and Q4 2005.
    
    
      
        
          BackWeb Technologies

          
            Quarterly Operating Results Overview
          
          
            (unaudited)
          
        
      
      
        
           
        
        
          Q4 – 2006Preliminary 
          Results
        
        
          Q3 – 2006

          
            Actual
          
        
        
          Q4 –2005

          
            Actual
          
        
      
      
        
          New License Sales
        
        
          $ 500,000 
        
        
          
            $30,000 
          
        
        
          $ 370,000 
        
      
      
        
          Total License Sales
        
        
          $ 550,000 
        
        
          $ 60,000 
        
        
          $743,00 
        
      
      
        
          Total Revenue
        
        
          $1,200,000 
        
        
          $ 720,000 
        
        
          $1,750,000 
        
      
      
        
          Net Loss (1)
        
        
          ($500,000) – ($600,000)
        
        
          ($1,560,000)
        
        
          ($300,000)
        
      
    
    
      (1) The Q4 2006 and Q3 2006 net losses include approximately $100,000 in 
      non-cash stock-based compensation related expenses. The Q4 2005 net loss 
      does not include such expenses.
    
    
      BackWeb’s CEO, Bill Heye, stated, “We 
      are encouraged by the improvement we achieved in license sales in Q4 as 
      well as the 2007 pipeline of customer and partner opportunities we have 
      developed so far. This improved performance will be complemented by our 
      previously announced cost cutting initiatives which should reduce 2007 
      expenses to approximately $1.5 to $1.6 million per quarter from 
      approximately $2.4 million per quarter in 2006. We felt it was important 
      to share this overview of our Q4 performance as we approach the 
      delisting of our shares from Nasdaq later this month. We will release 
      our final, audited Q4 2006 results in February.”
    
    
      NASDAQ Delisting – Move to OTC Bulletin 
      Board
    
    
      In May 2006, Nasdaq implemented a change in its continued listing 
      requirements to stipulate that non-U.S. companies must now comply with 
      Nasdaq Marketplace Rule 4320(e)(2)(E)(i) which states that the closing 
      per share bid price of Nasdaq listed companies must be at or above 
      $1.00. Non-U.S. companies had previously been exempted from the rule. In 
      July 2006, BackWeb received notification from Nasdaq indicating that, 
      for the last 30 consecutive business days, the bid price of BackWeb’s 
      Ordinary Shares had closed below the minimum $1.00 per share requirement 
      for continued inclusion on the Nasdaq Capital Market. In accordance with 
      Nasdaq Marketplace Rule 4320(e)(2)(E)(ii), BackWeb was provided 180 
      calendar days, or until January 16, 2007, to regain compliance by having 
      the bid price of its shares close at $1.00 per share or more for a 
      minimum of 10 consecutive trading days.
    
    
      On January 17, 2007, BackWeb received the expected written notification 
      from Nasdaq that the Company’s Ordinary 
      Shares will be delisted from trading on the Nasdaq Capital Market, 
      taking effect beginning on the morning of January 26, 2007. BackWeb’s 
      Ordinary Shares may become eligible for trading on the OTC Bulletin 
      Board if a market maker makes application to quote the Ordinary Shares 
      and such application is cleared by the NASD. BackWeb has already begun 
      seeking sponsorship from market makers in an effort to facilitate the 
      filing of a Form 211 in accordance with SEC Rule 15c2-11. A Form 211 
      application and its clearance are required for the listing of BackWeb’s 
      Ordinary Shares on the OTC Bulletin Board. The Company expects, but 
      cannot be certain, that trading on the OTC Bulletin Board would commence 
      on January 26, 2007 or soon thereafter.
    
    
      BackWeb’s Vice President, Finance, Ken 
      Holmes, commented, “As we had previously 
      indicated, after thorough review we have decided to take no action to 
      stay the delisting of our shares from Nasdaq. Our decision was based on 
      review of all the issues involved and the determination that our best 
      course was to keep our resources focused in support of our business. At 
      this point in our business, we believe a listing on the OTC Bulletin 
      Board will provide adequate liquidity for a company of our size as well 
      as for the investors in our company.”
    
    
      About BackWeb Technologies:
    
    
      BackWeb (http://www.backweb.com) 
      mobilizes critical web applications and content for mobile workforces 
      and remote offices. Mobile professionals can be productive anytime, 
      anywhere, without interruption, regardless of connection status or 
      network availability. BackWeb's web and polite synchronization mobile 
      solution delivers a seamless and simple user experience. The solution is 
      commonly deployed to sales forces, field employees, mobile managers and 
      remote operations. Typical e-business applications include enterprise 
      sales force automation, CRM, e-learning and training and Human Capital 
      Management (HCM). Content examples include document repositories and 
      rich media.
    
    
      BackWeb customers include market leaders such as Boehringer Ingelheim, 
      Eastman Kodak, GE Healthcare, Hewlett-Packard, Johnson & Johnson, KLA 
      Tencor, Lam Research, and Pfizer. BackWeb also serves customers through 
      partnerships with BEA, Oracle PeopleSoft and SAP. BackWeb's operations 
      are centered in San Jose, California, New York, New York, and Rosh Ha 
      'ayin, Israel. Make every minute of your mobile professional's day 
      productive; visit www.backweb.com 
      or call [phone].
    
    
      © 2007 BackWeb Technologies Ltd. All rights 
      reserved. BackWeb is a registered trademark and Offline Access Server is 
      a trademark of BackWeb Technologies Ltd. All other trademarks are 
      property of their respective owners.
    
    
      Oracle, JD Edwards, PeopleSoft and Siebel are registered trademarks of 
      Oracle Corporation and/or its affiliates.
    
    
      Statements in this news release, which are not purely historical, are 
      forward-looking statements within the meaning of Section 27A of the 
      Securities Act of 1933 and Section 21E of the Securities Exchange Act of 
      1934, including statements of beliefs, plans, expectations or intentions 
      regarding the future. Such forward-looking statements include, but are 
      not limited to, statements regarding BackWeb’s 
      anticipated operating results for the fourth quarter of 2006, the 
      improvement in the Company’s 2007 pipeline of 
      customer and partner opportunities, expected reductions in the Company’s 
      operating expenses for 2007, the anticipated transfer of BackWeb’s 
      Ordinary Shares to trading on the OTC Bulleting Board and the ability of 
      such transfer to provide BackWeb’s 
      shareholders with adequate liquidity. Actual results could differ 
      materially from those in such forward-looking statements. Factors that 
      could cause actual results to differ materially from expectations 
      include, but are not limited to, determination of BackWeb’s 
      anticipated financial results for the fourth quarter of 2006 is based on 
      preliminary information, which is subject to change; the uncertainty of 
      market acceptance of offline access products or our ability to license 
      those products to customers; general economic conditions or any downturn 
      in IT industry spending; the ability of BackWeb to develop innovative 
      technology and deliver solutions that meet customer needs; the potential 
      emergence of competitive technologies or competitor companies and 
      BackWeb may not be able to successfully transfer the trading of its 
      Ordinary Shares to the OTC Bulletin Board, and any such transfer may not 
      provide adequate liquidity for its shareholders. In addition, please 
      refer to our periodic filings with the Securities and Exchange 
      Commission, including our Quarterly Report on Form 10-Q for the quarter 
      ended September 30, 2006, which contain more detailed descriptions of 
      the risk factors facing our business. BackWeb assumes no obligation to 
      update any of the forward-looking statements in this release.