Borland to Acquire Software Quality Company, Segue Software; Announces Plan to Divest IDE Product Lines; Company Sets Course for

Borland Software Corporation (NASDAQ:BORL) today
announced aggressive plans to drive its Application Lifecycle
Management (ALM) business forward. As part of that plan, Borland has
agreed to buy Segue Software Inc. (NASDAQ:SEGU), the
Massachusetts-based provider of global software quality and testing
solutions. In addition, Borland announced plans to seek a buyer for
the portion of its business associated with the Integrated Development
Environment (IDE), including the award-winning Borland Developer
Studio (Delphi(R), C++Builder(R) and C#Builder(R)) and JBuilder(R)
product lines.
   Both actions are significant milestones in Borland's strategy to
secure leadership in the growing ALM sector and expand its ability to
offer organizations solutions that make software delivery a more
predictable and manageable business process.
   "Segue's quality optimization products and services will add
significantly to our growing portfolio of application lifecycle
management solutions," said Tod Nielsen, Borland president and chief
executive officer. "This is a natural extension of our focus to expand
beyond development and into software delivery, helping companies
increase business value through successful software initiatives."
   Nielsen continued: "The decision to expand our emphasis on ALM,
and at the same time enable our IDE business to get the attention it
deserves, enables us to do what's right for our business, what's right
for our customers, and what's right for the future of software
development."
   Borland and Segue have entered into a definitive merger agreement
in which Borland would acquire Segue in a one-step merger transaction
for $8.67 per share in cash, and anticipates the transaction to close
in the second calendar quarter. Concurrently with the execution of the
merger agreement, Borland entered into voting agreements with certain
significant Segue shareholders who own an aggregate of 21.5% of
Segue's outstanding shares and who have agreed to support the
transaction. The transaction is valued at approximately $100 million
and will be funded with existing cash on hand.

   Borland's Solution-Oriented Approach to Improving Software
Delivery Processes

   Borland's ALM solutions play a critical role in helping
enterprises manage the complexity of software development and
delivery, by providing business, development and operational teams
with increased visibility and control over all phases of the software
lifecycle. This is especially crucial for large enterprises working
within heterogeneous and distributed environments. IDC forecasts the
ALM market to grow to $3.3 billion in 2009, achieving a 9.2% compound
annual growth rate (CAGR) for 2004-2009(1).
   Over the past three years, Borland has built out its ALM portfolio
to include products and services for project and portfolio management,
demand management, requirements management, software configuration and
change management and modeling, among other areas. In 2006, Borland
intends to leverage these assets, its industry-leading process
optimization and educational service offerings, and the expertise and
technology it plans to acquire from Segue, to offer a series of
packaged and personalized solutions that enable customers to improve
the most critical process areas within software delivery. These areas
of focus include:

   --  IT Management and Governance

   --  Requirements Definition and Management

   --  Change Management

   --  Lifecycle Quality Management

   By increasing the maturity of these processes, companies can
better manage complexity, while also mitigating the risk of external
pressures such as compliance mandates, shifting business priorities
and industry consolidation. Borland intends to roll out comprehensive
solution offerings for each of the above mentioned processes
throughout 2006. Each solution offering will be an integrated package
of Borland's ALM technology, process optimization services and skills
training, all tailored to the customers' unique needs and goals. This
holistic and customized approach allows enterprises to more easily
align people, process and technology so they can deliver quality
software with maximum business value.

   Borland and Segue Team on Lifecycle Quality Management

   Segue Software, headquartered in Lexington, Mass., is an expert in
delivering solutions to define, measure, manage and improve software
quality throughout the entire application lifecycle. Upon completion
of this acquisition, Segue will bring to Borland its comprehensive
line of quality optimization and performance management products, a
global team with deep understanding of the quality and testing space,
and a significant customer base representing a wide range of
industries and Fortune 100 companies.
   Segue's software quality optimization solutions and industry
expertise will further extend Borland's leadership in the ALM space,
complementing Borland's existing product set and worldwide service
offerings. Segue's state-of-the-art Silk product line will also play a
central role in Borland's upcoming Lifecycle Quality Management
Solution, which looks to infuse quality throughout the lifecycle,
addressing the root cause of quality problems versus reacting to
symptoms later in the process when they are more costly. Segue's
technology will also be a key element of future versions of Borland's
integrated ALM platform.
   "Rarely do two companies share such a strong vision for
transforming their industry," said Joseph Krivickas, president and
chief executive officer of Segue Software. "Borland and Segue have
been partners for several years, helping our customers overcome the
challenges that cause project failure and poor software quality. By
bringing together our products and teams, we can help customers ensure
higher standards of quality and service, while systematically reducing
the costs associated with software quality issues."

   Borland Initiates Process to Divest IDE Product Lines

   While organizations look to ALM solutions to improve team and
organizational productivity, individual developers continue to demand
more feature-rich tools that will help improve their own productivity.
With this in mind, and the knowledge that developers play a pivotal
role in the application lifecycle, Borland has continued to invest in
its industry-leading development tools business in parallel with its
ALM investments.
   "Developers will always play an important role in the application
lifecycle, but the ALM and IDE markets are very different -- requiring
distinct business models, different operational and marketing
structures and a focused R&D team," said Nielsen. "Both markets are
important, but Borland can no longer give both the resources and
attention they require. Therefore, Borland has chosen to focus wholly
on its ALM business, while acting in the best interests of the
development community. Our intention is to create a standalone
business focused on advancing individual developer productivity."
   Borland has retained Bear, Stearns & Co. Inc. to manage the
process of seeking a buyer for Borland's IDE assets. To learn more
about this announcement, please visit www.borland.com.
   Borland will hold a conference call and simultaneous Webcast today
to discuss recent announcements. This will take place on February 8,
2006 at 11:00 a.m. PST. To participate, please dial [phone]. To
access the live Webcast, please visit the Investor Relations section
of www.borland.com. A replay will be available approximately two hours
after the conference call ends and will be available until February
23, 2006 at 12:00 a.m. PST. Please dial [phone] or (303)
590-3000, with passcode 11050769 to access the replay. The archived
Webcast will also be available on Borland's website.

   About Borland

   Founded in 1983, Borland Software Corporation (NASDAQ:BORL) is the
global leader in Software Delivery Optimization. The company provides
the software and services that align the people, processes and
technology required to maximize the business value of software. To
learn more about delivering quality software, on time and within
budget, visit: www.borland.com.

   Borland, Delphi, C++Builder, C#Builder, JBuilder and all other
Borland brand and product names are trademarks or registered
trademarks of Borland Software Corporation in the United States and
other countries. All other marks are the property of their respective
owners.

   Safe Harbor Statement

   This release contains "forward-looking statements" as defined
under the Federal Securities Laws, including the Private Securities
Litigation Reform Act of 1995 and is subject to the safe harbors
created by such laws. All statements that are not historical are
forward-looking. Such forward-looking statements include statements
regarding Borland's strategic focus, near-term and long-term outlook,
anticipated financial performance in the coming quarter, benefits and
synergies of the proposed acquisition of Segue Software, Inc., the
growth of the ALM market and Borland's ALM solutions, future product
offerings by the combined company and Borland's plan to seek a buyer
of its business dedicated to the Integrated Developer Environment
(IDE) (including the Delphi, C++ Builder, C#Builder and JBuilder
product lines). Actual results could differ materially from those
contained in the forward-looking statements and are based on current
expectations that involve a number of risks and uncertainties,
including, but not limited to, the receipt and timing of regulatory
approvals for the proposed acquisition; the possibility that the
acquisition will not close; the reaction of customers to the
acquisition; the reaction by competitors to the proposed acquisition
and the potential for increased pricing pressure by such competitors;
Borland's ability to successfully integrate Segue's operations and
employees; costs associated with the acquisition and Borland's ability
to manage its expenses following the closing; the Company's reduced
cash position following the acquisition; the results of our
exploration of the sale of Borland's IDE product lines; diversion of
management attention from other business concerns due to the proposed
transactions; undisclosed or unanticipated liabilities and risks
resulting from the proposed transactions; our ability to sell
multi-product solutions for the application development lifecycle; the
effects of a longer sales cycle as we increase our focus on larger
enterprise customers; market acceptance and adoption of our products
and services including our enterprise software development solutions;
our ability to enhance the quality and scalability of our products to
meet the needs of our customers; our ability to retain key personnel
and hire new leaders to support our business transition; and general
industry trends, general economic factors and capital market
conditions. These and other risks may be detailed from time to time in
Borland's periodic reports filed with the Securities and Exchange
Commission, including, but not limited to its latest Annual Report on
Form 10-K, and its latest quarterly report on Form 10-Q, copies of
which may be obtained from http://www.sec.gov. Borland is under no
obligation to (and expressly disclaims any such obligation to) update
or alter its forward-looking statements whether as a result of new
information, future events or otherwise. Information contained in our
website is not incorporated by reference in, or made part of this
press release.

   (1) IDC, "Worldwide Application Lifecycle Management Tools
2005-2009 Forecast," March 2005