FalconStor Software (FALC) Enters Into Managed Services and Reseller Agreement with HP

Nov. 9, 2010 (Business Wire) — FalconStor Software, Inc. (NASDAQ: FALC), the provider of TOTALLY Open™ data protection solutions, today announced that FalconStor entered into a managed services and reseller agreement with HP Enterprise Services.

Under the terms of the agreement, effective October 1, 2010, FalconStor^® Network Storage Server (NSS) software will be used to create new disaster recovery (DR) and business continuity offerings for HP Business Continuity & Recovery Services (BCRS) customers. This agreement enables HP Enterprise Services to add new heterogeneous replication services to the comprehensive offerings of HP BCRS as well as the full data protection capabilities of the FalconStor NSS solution.

“The FalconStor NSS solution’s heterogeneous replication feature provides HP’s Business Continuity & Recovery Services a critical capability that allows HP to replicate between any brand of storage to and from the customer site and the BCRS recovery site,” said Bernie Wu, vice president of business development for FalconStor. “We look forward to working with HP and providing leading products in the growing market for cloud-based replication and DR solutions.”

About FalconStor Software

FalconStor Software, Inc. (NASDAQ: FALC) is the market leader in disk-based data protection. FalconStor delivers proven, comprehensive data protection solutions that facilitate the continuous availability of business-critical data with speed, integrity and simplicity. The Company’s TOTALLY Open™ technology solutions, built upon the award-winning IPStor^® platform, include the industry leading Virtual Tape Library (VTL) with deduplication, Continuous Data Protector (CDP), File-interface Deduplication System (FDS), and Network Storage Server (NSS), each enabled with WAN-optimized replication for disaster recovery and remote office protection, and the HyperFS™ file system. FalconStor products are available as OEM or branded solutions from industry leaders, including Acer, Data Direct Networks, Dynamic Solutions International, EMC, Fujitsu, Hitachi Data Systems, Huawei, Pillar Data Systems, SGI, SeaChange and Spectra Logic and are deployed by thousands of customers worldwide, from small businesses to Fortune 1000 enterprises.

FalconStor is headquartered in Melville, N.Y., with offices throughout Europe and the Asia Pacific region. FalconStor is an active member of the Storage Networking Industry Association (SNIA). For more information, visit www.falconstor.com or call 1-866-NOW-FALC (866-669-3252).

FalconStor, FalconStor Software and IPStor are registered trademarks and TOTALLY Open and HyperFS are trademarks of FalconStor Software, Inc., in the U.S. and other countries. All other company and product names contained herein may be trademarks of their respective holders.

Links to websites or pages controlled by parties other than FalconStor are provided for the reader’s convenience and information only. FalconStor does not incorporate into this release the information found at those links nor does FalconStor represent or warrant that any information found at those links is complete or accurate. Use of information obtained by following these links is at the reader’s own risk.

FalconStor Software, Inc.

Roman Kichorowsky, 631-773-4303

romank@falconstor.com

or

Metis Communications

Melissa Cohen, 617-236-0500

melissa@metiscomm.com