General FAQ

• Background
• Benefits
• Support
• Product and Services
• Helpful Resources and Additional Information

Background

On November 14, 2006, SumTotal Systems, Inc. acquired MindSolve Technologies Inc.

Q: Why did SumTotal acquire MindSolve?

A: SumTotal expects its acquisition of MindSolve, a profitable, growing company in the performance management market, to become a key component in SumTotal’s talent management offering.

The talent management market is still young and growing at 17% CAGR in a $2B market. With MindSolve, SumTotal expects to compete better in this market with best-of-breed solutions for both the pure-play and the integrated suite opportunities.

SumTotal believes MindSolve is an excellent acquisition because its product has strong functionality that has impressed customers and analysts alike.

MindSolve’s patented technology includes sophisticated capabilities for analyzing employee “bench strength,” creating and managing succession plans, aligning goals, appraising performance and evaluating compensation. SumTotal expects the acquisition of MindSolve to differentiate the combined company from other pure-play vendors by providing exceptional usability for performance management automation with patented, innovative technology, graphical tools, offline access, integration with Balanced Scorecards and domain expertise. In addition, SumTotal provides two delivery models: behind a firewall and software-as-a-service (SaaS).

SumTotal believes the acquisition distinguishes the company from other learning software firms that have created performance management solutions by providing a richer, innovative and more mature functionality based on years of implementations and customer usage.

Q: Will there be changes to SumTotal’s management team?

A: No. The SumTotal management team remains intact. In addition, Charles Steadham, MindSolve’s former President, will remain on a consulting agreement for a transition basis. Dan Boccabella and Jeff Lyons will also be joining SumTotal as part of the Center of Excellence based in Gainesville.

Q: What are the t erms of the agreement?

A: Under terms of the transaction, MindSolve shareholders will receive approximately $5.2 million in cash along with 925,000 shares of SumTotal common stock.

Q: Will there be layoffs and/or relocations?

A: Other than back office support, there are currently no other planned staff reductions or relocations.

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Benefits

Q: What benefits can customers expect?

A: SumTotal expects the acquisition to expand SumTotal’s talent management offering to include best-of-breed solutions, including performance management, succession planning and compensation management. SumTotal provides customers with a choice by offering a standalone solution or an integrated learning and performance management suite.

As a result of the acquisition, SumTotal believes current and future customers will have:

• The industry’s leading integrated suite of learning and performance software and services, which will drive and measure performance improvement throughout their organization and across their extended enterprise
• The choice of a SaaS or behind-the-firewall implementation
• Access to premier domain expertise based on MindSolve’s years of industry experience with companies of all sizes
• Exceptional usability with patented, innovative drag-and-drop, offline access and visual comparison functionality, based on real-business experience
• Combination of outstanding, complementary technology that leverages SumTotal’s broad distribution capabilities providing a solution to large, enterprise organizations

For MindSolve customers, they also now have:

• The largest dedicated, global customer support and research and development organizations in the industry
• The safety and security of doing business with a large, financially stable provider of learning software and services that is dedicated to accelerating clients’ business performance and results

Q: What benefits can partners from both companies expect from the acquisition?

A: Standing SumTotal partnerships will not be affected. Partners can now expect to leverage more from SumTotal for future opportunities. Customers may continue to work with other vendors as part of their talent management implementation. SumTotal offers an open framework for integration with other solution providers.

Also, there are no planned changes in current MindSolve partnerships. SumTotal plans to continue these relationships to provide unique and powerful talent management solutions.

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Support

Q: What are SumTotal’s plans regarding account coverage for MindSolve clients?

A: Until further notice, please rely on your existing account team. Few changes are anticipated. SumTotal will notify you with any process modification.

Q: Whom do I contact for support?

A: Please rely on your existing account team and technical support contacts. If a change occurs, SumTotal will let you know.

Q: How does SumTotal intend to work with other Talent Management vendors?

A: SumTotal plans to continue supporting its key talent management partnerships. In addition, SumTotal plans to keep an open-integration architecture allowing customers to choose what applications integrate with SumTotal. Enhancements will continue in-line with market demand.

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Product and Services

Q: Will SumTotal support my product going forward?

A: Yes. The main purpose of this acquisition was to combine two best-of-breed products for an integrated, robust talent management solution. SumTotal plans to continue investing in product development for the current versions of each of its product lines.

Q: What are the plans for future releases of MindSolve products?

A: SumTotal is currently planning a roadmap which it believes will ultimately lead to the convergence of the SumTotal and MindSolve releases, but at the same time retain capabilities for the ongoing development and support of our MindSolve customers. SumTotal is committed to delivering the key capabilities expected by MindSolve customers for future product versions --- many are already included in the current SumTotal platform.

Q: How will the base technologies of MindSolve and SumTotal fit together?

A: Both platforms operate on nearly identical .NET architectures. This will streamline integration efforts.

Q: Will the MindSolve product line stay intact?

A: Branding for the MindSolve products (MindSolve MVP Suite) will move under the TotalPerformance™ product, as an integrated performance and compensation suite and as standalone modules.

Helpful Resources and Additional Information

• For more information, please call 1.866.SMTOTAL or visit www.sumtotalsystems.com.

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SAFE HARBOR STATEMENT/ FORWARD-LOOKING STATEMENTS
Information in this document contain forward-looking statements and management’s estimation regarding future performance of the company. These statements represent SumTotal Systems' expectations or beliefs concerning its results and future events, including statements, among others, regarding the growth of the talent management market, the company’s ability to successfully integrate the MindSolve business, product offerings and technology as a result of the acquisition and the company’s competitive position and business model, including its leadership position. These statements are only predictions and not historical facts or guarantees of future performance or events and are based on current expectations, estimates, beliefs, assumptions, goals and objectives, and involve known and unknown risks, uncertainties and other factors that may cause actual results to be differ materially. Readers of this document are cautioned not to place undue reliance on any forward-looking statements. Additional factors that could cause actual results to differ include, but are not limited to, the failure to: (i) successfully integrate the MindSolve business and product offerings into the SumTotal business and product offerings in a timely matter; (ii) successfully achieve the expected synergies from MindSolve’s technology and SumTotal’s sales and marketing resources; (iii) successfully scale the MindSolve business without significant additional expense; (iv) retain MindSolve customers; (v) retain key employees; and (vi) successfully address technological developments and standards and changing client needs. These and other risks and other important factors disclosed previously and from time to time in SumTotal Systems’ filings with the Securities and Exchange Commission, including the company’s annual report on Form 10-K filed on March 28, 2006, its quarterly report on Form 10-Q filed on November 9, 2006, its Form S-3/As filed on September 28, 2006, and October 2, 2006, and its Form 8-Ks. SumTotal Systems assumes no obligation to update the information contained in this document. The forward-looking statements contained in this document are made as of November 14, 2006, and SumTotal does not assume any obligation to update such statements to reflect events or circumstances occurring after November 14, 2006.

If you would like to talk with us about how we might help you strengthen your learning and development, talent and employee performance, please call us at 1-866-SMTOTAL (866-768-6825) and ask to speak to one of our Sales professionals, or use our online contact form to have us contact you.

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