Monday July 31, 2000

Company Press Release

Cylink  Corporation to Acquire  Celotek  Corporation to Expand Its Leadership in
ATM Network Security

SANTA CLARA, Calif.--(BUSINESS WIRE)--July 31, 2000--Cylink Corp. (Nasdaq:CYLK -
news)  today  announced a  definitive  agreement  to acquire  Celotek  Corp.,  a
privately held developer of  high-performance  Asynchronous  Transfer Mode (ATM)
network security  appliances used to secure voice,  video and data  transmission
over high-speed public and private wide area networks.

The definitive agreement calls for Cylink to issue $21.5 million in common stock
and the acquisition will be treated for accounting  purposes as a purchase.  The
transaction  will be dilutive to net earnings in the third quarter of this year,
but the  Company  expects  it will  contribute  to  achievement  of its  goal of
reaching  fourth  quarter  profitability.   Completion  of  the  acquisition  is
conditioned,  among other matters, upon approval by Celotek's shareholders,  and
is expected to close by the end of the current quarter.

Celotek,  headquartered  in the Research  Triangle Park area of North  Carolina,
supplies the ATM encryption  appliances that Cylink,  under private label, sells
to Fortune 500 companies, government agencies, and major financial organizations
around the world.

"This  acquisition  is  compelling  any  way you  look  at it - from  strategic,
financial,  technical  and  marketing  perspectives,"  said William P.  Crowell,
Cylink's president and chief executive officer. "It will enable us to manage all
elements of a large and growing  part of our core  business,  reduce our cost of
goods and improve our margins,  while providing  additional product  development
and  engineering  capabilities.  At  the  same  time,  this  will  increase  our
flexibility in driving market  acceptance of ATM security as a means of securing
backbone telecommunications.

"It also will enable us to add an highly talented group,  including a team of 20
ATM engineers who have worked together in successfully developing and delivering
state-of-the-art  products demanded by the marketplace.  And,  finally,  Celotek
will bring new channel partners to Cylink, some of whom may expand their product
portfolios   to  include  our  full   product  and  solution  set  for  securing
e-business," Crowell said.

About Celotek

Celotek is a global leader in high performance security solutions.  CellCase(TM)
cryptographic  systems set the standard  for  Asynchronous  Transfer  Mode (ATM)
network security,  providing transparent Triple DES encryption at speeds ranging
from 1.5 Mbps to 622 Mbps. Mode  information  about the company and its products
can be  found at  www.celotek.com.  Celotek  is  headquartered  in the  Research
Triangle Park area of North Carolina.



About Cylink Corp.

Cylink Corp.  develops,  markets and supports a  comprehensive  family of secure
e-business  solutions.  Founded in 1983,  the Company  was the first  created to
market  security   solutions  that  protect   communications   with  public  key
cryptography.  Cylink  and its  wholly  owned  subsidiaries  serve  Fortune  500
companies,   multinational  financial  institutions,   and  government  agencies
worldwide.   For   more   information,   visit   the   Company's   web  site  at
http://www.cylink.com.

Except for the historical  information  contained  herein,  matters discussed in
this   release  are   forward-looking   statements   that   involve   risks  and
uncertainties, and actual results could be materially different. Forward-looking
statements  include this  successful  completion  and expected  time required to
close the acquisition,  the improvement in Cylink's  margins,  cost of goods and
other financial benefits of the acquisition, improvements in Cylink's management
of its ATM  business,  success in future  product  developments,  its ability to
retain and integrate  the Celotek  engineering  team into Cylink,  future market
acceptance  of  Celotek's  ATM  encryption  products,   and  opportunities  with
Celotek's existing resellers.  Factors that could cause actual results to differ
include:  business  conditions in the computer  security  industry;  competitive
factors,  including  but not  limited  to the entry of  large,  well-capitalized
companies;  price-cutting  pressures;  and  the  possible  introduction  of  new
technologies  and other risk factors  listed from time to time in the  company's
SEC reports, including but not limited to the report on Form 10-K and the Annual
Report to shareholders  for the year ended Dec. 31, 1999 and its reports on From
10-Q.


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