Applied Microsystems Launches Libra Networks; New Division to Focus on InfiniBand Architecture-Based Solutions for High-Speed Networking and Data Center Management.

Business Editors/High-Tech Writers

REDMOND, Wash.--(BUSINESS WIRE)--May 23, 2002

Applied Microsystems Corp. (Nasdaq:APMC) today announced the formation of a new division called Libra Networks (www.libra-networks.com).

The launch of Libra Networks initiates a corporate strategy to expand the company's technologies and services to serve the end-user IT market, specifically in the areas of high-speed networking and data center management.

"We are entering a stage in computing where 'the server cluster is the computer' and the architecture of the data center will be changing dramatically to make this happen," said Stephen J. Verleye, President and CEO of Applied. "Libra Networks is created with the express intent to bring contemporary technology to bear that improves the flexibility, performance, and total cost of ownership (TCO) of server farms and client traffic management."

A key underlying component of the Libra Networks solutions strategy is based on harnessing new fabric-based interconnect technologies such as InfiniBand(TM) Architecture. InfiniBand technology is a switched fabric I/O technology that has been developed to enable a new generation of data centers that communicate better, and respond much more dynamically and efficiently to client requests.

News of Libra Networks and its adoption of InfiniBand technology is being greeted positively in the industry. "InfiniBand architecture provides data centers with new levels of performance and flexibility," said Jim Pappas, director of initiative marketing for Intel's Enterprise Platforms Group. "Applied Microsystems entree into the InfiniBand market with the launch of Libra Networks underscores the momentum behind InfiniBand connectivity for data centers. Applied Microsystems' expertise in the industry provides a great foundation for Libra Network's success." Intel is joined by Compaq, Dell, Hewlett-Packard, IBM, Microsoft and Sun Microsystems on the Steering Committee for the InfiniBand Trade Association, the industry body driving the wide-scale deployment of InfiniBand Architecture enabled solutions to data centers.

Commenting on the mission of Libra Networks, Scott Winkler, president and CEO of D.H. Brown Associates, noted: "Applied's 23 years in engineering solutions for the toughest systems issues, the experience of its senior business, engineering and marketing teams, together with the recent acquisition of REBA Technologies, means that Libra Networks already has a very strong foundation upon which to innovate in this exciting and emerging product segment."

"I expect InfiniBand architecture to be widely accepted in the world's data centers over the next several years," added Vernon Turner, VP at IDC. "Libra Networks is entering the market at a time when almost all of the industry growth is still out ahead."

About Libra Networks

Libra Networks is a new division of Applied Microsystems Corporation focused on developing and marketing contemporary solutions for web-accessible server farms typically found in corporate data centers. Headquartered in Redmond, Washington, USA, it is a member of the InfiniBand Trade Association and the PCI Industrial Computer Manufacturers Group (PICMG). For more information, please visit www.libra-networks.com or call 1-800/762-4969, 425/882-5277.

About Applied Microsystems

Applied Microsystems is a publicly owned company and a leader in developing innovative technologies for the embedded market, such as application software test, debug, and verification tools used to achieve unprecedented visibility and reliability in systems -- including high-speed storage area networking appliances, communications and networking equipment.

The company is applying its experience and expertise to provide new applications in growth markets such as enterprise server farms and Internet-based networking equipment.

The company can be reached at P.O. Box 97002, Redmond, WA 98073-9702; by phone at 800/426-3925; or by e-mail at [e-mail]. Visit Applied Microsystems on the Web at www.amc.com.

All trademarks and copyrights are property of their respective owners and are protected therein.

Forward-looking statements in this press release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from historical results or those anticipated or stated or implied by such forward-looking statements. These factors include, without limitation, the ability of the Company to integrate the REBA technology into its development plans, the ability of the Company to successfully develop hardware and software to be used in markets such as enterprise server farms and internetworking equipment using intellectual property acquired in the transaction, market acceptance for planned products and services, relationships with third parties, sufficient availability and retention of qualified personnel, ability of the Company to maintain/improve gross margins and operating margins on its existing products and service while shifting its research and development focus to include hardware and software aimed at end-user markets, the overall economic climate of the businesses and geographies in which the Company operates, availability of sufficient resources, and other risks and uncertainties detailed in the Company's filings with the Securities and Exchange Commission.