Commtouch Meets NASDAQ Listing Requirements and Drops ''C'' from Ticker Symbol; Ticker Symbol Reverts to ''CTCH''

Business Wire, June 26, 2005

MOUNTAIN VIEW, Calif. -- Commtouch(R) (NASDAQ:CTCH), the developer of ground breaking RPD(TM) technology for real time anti-spam and zero-hour virus protection, today announced that its ticker symbol will revert to "CTCH" from "CTCHC" as of the opening of trading Monday, June 27, 2005.

This change is highlighted by the determination of The NASDAQ SmallCap Market that Commtouch has satisfied all of the conditions of the exception to listing announced by the company on June 28, 2004, and the company meets all listing requirements.

Gideon Mantel, CEO of Commtouch, stated: "We are extremely pleased that we are able to return to our former ticker symbol. It's a reflection of the progress we are making in our business generally. The recent improvements in several areas of our business are all pointing to a successful future for Commtouch."

The company's stock had been trading under the CTCHC symbol since June 30, 2004 pursuant to an exception to the requirement to maintain shareholders' equity of at least $2.5 million.

About Commtouch

Commtouch Software Ltd. (NASDAQ:CTCH) is dedicated to protecting and preserving the integrity of the world's most important communications tool -- email. A global developer and provider of proprietary anti-spam solutions, Commtouch has an installed base of over 25 million users. The company's core technologies, including RPD(TM) - Recurrent Pattern Detection, reflect Commtouch's 14 years of experience developing messaging software. Commtouch solutions are incorporated into OEM applications and are also sold through channels and resellers. Commtouch is headquartered in Netanya, Israel and has a subsidiary in Mountain View, CA. For more information, see www.commtouch.com.

This press release contains forward-looking statements, including projections about our business, within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. For example, statements in the future tense, and statements including words such as "expect," "plan," "estimate," anticipate," or "believe" are forward-looking statements. These statements are based on information available to us at the time of the release; we assume no obligation to update any of them. The statements in this release are not guarantees of future performance and actual results could differ materially from our current expectations as a result of numerous factors, including business conditions and growth or deterioration in the Internet market, commerce and the general economy, both domestic as well as international; fewer than expected new-partner relationships; fewer than expected license agreements resulting from Commtouch's exclusive rights to market DCC; competitive factors including pricing pressures; technological developments, and products offered by competitors; the ability of our OEM partners to successfully penetrate markets with products integrated with Commtouch technology; a slower than expected acceptance rate for real time AV solutions in general and the Commtouch Zero Hour(TM) Virus Protection product in particular; availability of qualified staff for expansion; technological difficulties and resource constraints encountered in developing new products, such as the Zero Hour solution; and the failure of Commtouch to meet The NASDAQ SmallCap Market's listing standards in the future;, as well as those risks described in the text of this press release and the company's Annual Reports on Form 20-F and reports on Form 6-K, which are available through www.sec.gov.

Recurrent Pattern Detection, RPD and Zero-Hour are trademarks, and Commtouch is a registered trademark, of Commtouch Software Ltd. U.S. Patent No. 6,330,590 is owned by Commtouch.