{Artisoft Revolutionizes Connectivity!} Artisoft designs and manufactures a full product line of low- cost, award-winning software, hardware and systems for local area network (LAN) communications. {Local Area Network Market Overview: Growth in personal computer sales is providing a large base of PCs available for networking which, according to the Gartner Group, is projected to grow from 31.2 million in 1991 to 52.2 million in 1995. The Gartner Group has also projected that the number of personal computers connected to LANs will increase from 54% in 1991 to 73% in 1995. More and more small- to medium-sized businesses are turning to LANs to save money and increase productivity through the sharing of expensive peripherals, the automation of data handling, and the implementation of other time-saving applications such as electronic mail. Larger companies have turned to local area networks for the same reasons -- economy and productivity. LANs allow corporate users to maintain their independence from minicomputers and mainframes, while still offering access to information residing on those larger computers. MIS directors have found that connecting PCs via LANs is more cost-effective than via minicomputers and mainframes. But LANs have always been the affordable alternative, and are even more so today because of the advances in technology coupled with the intense competition among LAN manufacturers. Open any publication today and it becomes obvious that today's network consumer faces an ever-increasing number of LAN options. Increasingly affordable prices make LANs more attractive to budget-minded businesses of any size that are interested in sharing data and expensive peripherals and establishing a basic electronic mail system. Because most of these groups do not have a readily available MIS manager or extensive in-house technical support, they need simplicity combined with functionality. Peer-to-peer networks are easy to install, use, administer and expand. They are also more flexible -- allowing any PC in the network to act as a server and/or workstation -- and cost less than dedicated-server networks. But not all peer-to-peer networks are created equal. LAN purchasers need to consider a variety of issues when choosing a LAN in order to select the product that best meets their needs. These issues include price and performance (throughput speed), ease of use and administration, flexibility, expandability, security, compatibility and support. {History and Financials:} Founded by Jack Schoof in 1982 through private investment, Artisoft recently went public in September, 1991. Artisoft first designed and sold telecommunications software, peripheral-sharing devices and IBM PC compatibles. Schoof foresaw tremendous opportunity in the LAN market and began developing the LANtastic (R) Local Area Network product line in 1986. Artisoft sales tripled from $2.1 million in fiscal year 1988 to $6.6 million in 1989, more than tripled again to $21.1 million in fiscal year 1990, and almost doubled to $41 million in fiscal year 1991. Artisoft's installed base of adapters is over 400,000 and its installed network nodes worldwide is 500,000. {Artisoft's Strategy: Marketing efforts include advertising campaigns, product publicity, direct mail, LANDA membership, and trade show participation at COMDEX, NetWorld, PC Expo, FOSE and a variety of smaller shows. Artisoft sells through more than 7,000 authorized resellers in the United States. Ingram Micro, Merisel and TechData are distributing Artisoft(TM) products and several major chains have picked up Artisoft products including Canon, CompuAdd, Computer City, PC Distributing, Vitronix, Vitex, Computer Factory, Dell, Egghead Discount Software, Global Computer, INMAC, Tandy, and SoftWarehouse. Artisoft sells internationally through distributors in Argentina, Australia, Austria, the Benelux (The Netherlands, Belgium, and Luxembourg), Canada, Chile, France, Iceland, Germany, Greece, Hong Kong, Israel, Italy, Japan, Mexico, New Zealand, Pakistan, Poland, Scandinavia (Denmark, Finland, Norway, and Sweden), Singapore, South Korea, Spain, Switzerland and Turkey. Artisoft's target market is small to medium sized businesses (under 500 employees) -- as well as corporate and university workgroups -- that are looking for an affordable, powerful network solution with minimal RAM requirements and ease of use. Although client-server networks may be appropriate for high-end LAN solutions, most small businesses don't have the same budgets, technical expertise or needs. Artisoft's LANtastic Local Area Network is the leading LAN solution for this target market. Artisoft has also developed a broad line of innovative hardware and software connectivity products that provide a one-stop solution for Artisoft resellers and endusers alike. {Artisoft's Industry Recognition: When Artisoft engineers began developing the LANtastic Local Area Network product line in 1986, innovative design and affordability were key considerations. The results of their creativity and cost-consciousness were powerful networking solutions and LAN applications that require very little memory, are easy to use, feature-rich and low-cost. [{LANtastic Local Area Network:}] {1991 PC Magazine Editors' Choice for DOS-based LANs {1991 LAN Magazine Product of the Year for entry-level {network operating systems {1991 LAN Times Readers Choice for peer-to-peer networks {1990 PC Magazine Editors' Choice for peer-to-peer network {operating systems {1990 PC Magazine Editors' Choice for LANtastic's CD-ROM {networking {1990 LAN Times Recommended for Networking {1990 Systems Integration Product of the Year Finalist for {Local Area Networks {1989 PC Magazine Editors' Choice for low-cost LANs {1989 PC World Best Buy for low-cost LANs {1988 PC Magazine Technical Excellence Nomination {1988 BYTE Magazine Award of Distinction [{LANtastic Z (TM) Zero-Slot Local Area Network:}] {1990 PC Magazine Editors' Choice [{Central Station (TM) Connectivity Processor:}] {1991 BYTE & Interface Group's Best of Spring COMDEX in {Connectivity [{Sounding Board (TM) Adapter:}] {1990 PC Magazine Technical Excellence [{The Network Eye (R) LAN Remote Control Program:}] {1988 LAN Magazine Product of the Year {Corporate Officers: {C. John (Jack) Schoof II, President and CEO: Jack Schoof founded Artisoft in 1982 while working for Hughes Aircraft Company in Tucson. From modest beginnings as a 1 person company, Jack now oversees a fast-growing company that employs almost 300 people. He designed the LANtastic 2Mbps adapter and user interfaces to the LANtastic Network Operating System. Jack received his B.S. in Electrical Engineering from the University of Arizona and has worked in the computer industry since 1972. He was awarded the 1990 Ernst & Young/Inc. Entrepreneur of the Year for High Technology in the Southwest region after being a finalist in 1989. His outside interests include music synthesis, soaring, scuba diving and photography. {Alex Karahalios, Vice President of Product Development: Alex Karahalios is responsible for new hardware and software development, as well as feature enhancements to the LANtastic network. During the creation of the LANtastic network, he designed the LANtastic NetBIOS, Redirector and Server. He holds a B.S. in Electrical Engineering from the University of Arizona and has worked in the computer industry since 1976. His outside interests include the development of novel consumer electronics and man/machine interfaces. {Adrian King, Vice President of Engineering: Adrian King assists in product development as well as managing projects and coordinating various groups within the engineering department. He joined Artisoft in July of 1991 after serving as Assistant General Manager for Microsoft's Network Business Unit. He also managed and assisted in the design and development of various Microsoft systems software products, including LAN Manager, SQL Server, XENIX, and versions of MS-DOS and Windows. He is an active participant in scuba diving, soccer and other sports. {William D. Baker, Chief Financial Officer: Bill Baker joined Artisoft in early 1990, bringing 20 years of high-tech financial experience to his new position. Prior to Artisoft, he served as the corporate controller for Burr-Brown Corporation, a $200 million multi-national semi-conductor manu- facturer; and as an officer and corporate controller for CTS Corporation, a $275 million multi-national electronic component manufacturer. Bill is active on the Financial Executives Institute's Committee for Employee Benefits and the Tucson Chamber of Commerce's legislative and education committees. In his free time, he enjoys watching and participating in sports, reading and traveling. {Dennis R. Weyrauch, Esq., General Counsel & Corporate Secretary: Dennis Weyrauch joined Artisoft in 1990 to provide legal counsel in business matters such as general corporate, real estate transactions, contracts and employment law. Dennis earned his undergraduate degree in computer science from St. Thomas College in Minnesota and his law degree from the University of Arizona. He has worked in the legal profession since 1983 and enjoys downhill and cross-country skiing, racquetball and cycling. {Dave Hallmen, Vice President of Sales & Marketing: Dave Hallmen, one of Artisoft's original ten employees, joined the Artisoft Sales Department in 1988, shortly after the LANtastic Local Area Network was introduced. His experience in sales and computers enabled him to contribute significantly to the development of Artisoft's successful sales programs, policies, and procedures. His outside interests include racquetball, golf and weightlifting.