July 14, 2004

Network Engines, a leading developer, manufacturer and distributor of storage and security solutions, and VASCO Data Security International, Inc (Nasdaq: VDSI; www.vasco.com), a global provider of security products that enable e-business and e-commerce, today announced an agreement to bring two-factor authentication solutions uniquely developed to serve the security needs of small to midsize enterprises.

The authentication solution consists of VASCO VACMAN Middleware software and complete line of Digipass tokens, which combined, provide strong authentication for Corporate Network Access Security. The VASCO solution will be distributed to North American reseller partners by Network Engines distribution operation, TidalWire.

"VASCO's Digipass two-factor authentication solution is a major asset to our authentication offering," said Bruce Ligerman, president and CEO at LogiTel USA, a New York-based remote access systems integrator specializing in enterprise solutions. "With security mandates and concerns affecting even smaller firms, a secure, easily deployed solution at clearly competitive price points-- like VACMAN/Digipass -- has real appeal to us and our customers."

"We are offering this solution through Network Engines and TidalWire because of the knowledge and focus they have demonstrated in the security and distribution areas, said Kevin Donovan, VP of Business Development at VASCO. "We also are impressed by the level of service and customer satisfaction associated with the TidalWire organization. We feel confident that this is the best partner to represent our product to the reseller channel."

"Network Engines is delighted to be chosen by VASCO to deliver the VACMAN/Digipass solution to our reseller and integration partners,"
said Mike Riley, vice president of sales, marketing and strategy at Network Engines. "Increasingly, these partners are seeking security solutions that meet the demands of the smaller enterprise customer.

VASCO's Digipass authentication solution provides essential, large enterprise-class functionality at a price point that smaller companies can afford.

Pricing for the VASCO solution starts at $2,350 for a 25-user solution. Demo packages are available at www.vasco.com/networkengines.

For further information, contact TidalWire sales at 877-574-7600 or e-mail to [email protected].

VASCO designs, develops, markets and supports patented "Identity Authentication" products for e-business and e-commerce. VASCO's Identity Authentication software is delivered via its Digipass security products, small "calculator" hardware devices carried by an end user, or in a software format on mobile phones, other portable devices, and PCs. For user access control, VASCO's VACMAN products guarantee that only designated Digipass users get access to the application. VASCO's target markets are the applications and their several hundred million users that utilize fixed passwords as security. VASCO's time-based system generates a "one-time" password that changes with every use, and is virtually impossible to hack, or break. With over 11 million Digipass products sold and ordered, VASCO has established itself as a world-leader for strong Identity Authentication with 280 international financial institutions, approximately 1500 blue-chip corporations, and governments in more than 60 countries.

About Network Engines
Network Engines (NASDAQ: NENG) is a leading developer, manufacturer and distributor of storage and security solutions. The company works with software partners to develop, manufacture, and distribute server appliances for mission-critical storage and security networking applications. Headquartered in Canton, Massachusetts, Network Engines was founded in 1997. For additional information on the Company's products and services, visit www.networkengines.com.

Safe Harbor and Forward Looking Statements

Statements in this press release regarding Network Engines' future financial performance and any other statements about Network Engines'
management's future expectations, beliefs, goals, plans or prospects constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The Company's actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including those factors contained in the Company's most recent Annual Report on Form 10-K for the year ended September 30, 2003 and most recent Form 10-Q for the quarter ended March 31, 2004 under the section "Factors that May Affect Future Operating Results" as well as other documents that may be filed by the Company from time to time with the Securities and Exchange Commission. Forward-looking statements include statements regarding the Company's expectations, beliefs, intentions or strategies regarding the future and can be identified by forward-looking words such as "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "should," "will" and "would" or similar words. The Company assumes no obligations to update the information included in this press release.

Network Engines, and Network Engines logo are trademarks of Network Engines, Inc. All other registered and unregistered trademarks in this document are the sole property of their respective owners.

CONTACT: Acaggio for Network Engines
Joni Moore, 508-308-7900
[email protected]


Network Engines
Bonnie Anderson, 781-332-1115
[email protected]


VASCO Contact:
Jochem Binst, +32 2 456 98 10
[email protected]