BSQUARE Strengthens Global Sales Network with 17 New Partnerships.

Business Editors

BELLEVUE, Wash.--(BUSINESS WIRE)--Aug. 14, 2001

Focuses on Rapidly Growing International Markets

For Windows Embedded Smart Devices

Expanding the reach and scope of its international sales network, BSQUARE(R) Corporation (Nasdaq:BSQR) today announced it signed distribution agreements with 17 representative and distribution firms located throughout Asia, Europe, and Latin America.

The representatives will offer BSQUARE's comprehensive line of products and services designed to speed the development of smart devices and enhance the end-user experience. Products include device driver toolkits and software development kits for Microsoft Windows CE and Windows NTe Operating Systems, mobile enterprise solutions, quality assurance tools, information appliance solutions, product design packages, and wireless solutions.

The BSQUARE sales partners are: All-locations B.V. (The Netherlands), BBI Software GmbH (Switzerland), Bematech Ind. e Com (Brazil), Chander Electronics Corporation (Taiwan), Channel Technologies (Singapore), Channel Technologies Ltd. (Taiwan), Channel Technologies Pte Ltd (Malaysia), DSI (Israel), DST Corporation (Korea), HyubWoo Info Tech (Korea), InfoCom GmbH (Germany), Latam Solutions (Argentina), LinSoft AB (Sweden), SAIC (Taiwan), SOS Developers (France), Grey Matter Ltd. (United Kingdom), and Programmers Paradise (USA).

"Our representative and distribution sales network will enable BSQUARE to expand its presence in growing international markets for embedded computing products and smart devices," said Lew Larson, vice president of marketing for BSQUARE Corporation. "In Latin America, we see heavy demand for Internet appliances that provide consumers with access to the Internet without requiring them to purchase a relatively expensive PC. In Europe, smart devices are gaining a foothold in a wide range of applications, such as automotive, industrial automation, and healthcare. And demand for handheld computers and wireless access devices continues unabated in both Europe and Asia where network infrastructures have already been built."

BSQUARE selected its international sales partners based on several factors, including prior experience and industry contacts in embedded computing markets; ability to provide dedicated pre- and post-sales resources; and level of business relationships with Microsoft Corp.

"By bringing years of expertise, passion for the business, a knowledgeable staff and dedicated resources to Latin America, the BSQUARE product and service offerings allow us to develop and quickly react to the needs of this fast growing market region, supporting our major customers, partners and OEMs and building new business for Microsoft through the Windows Embedded family of products," said Celso Winik, LATAM Regional Manager for Microsoft's Embedded Systems Group.

"BSQUARE hopes to have a network of indirect channel partners in each of several key growth markets around world," said Craig Hummel, director of channel sales for BSQUARE. "This will ensure that our customers have the option to pick a sales partner that best suits their business requirements."

Business Partner Program

The BSQUARE Business Partner Program provides international sales partners with the support and tools required for success in the growing smart device market. Financial benefits include access to market development funds, qualified leads, and competitive discounts. Other benefits include training, technical/sales support, order assistance, marketing materials, and sales tools. To apply to become an authorized BSQUARE representative or distributor, please complete the form found at http://www.bsquare.com/partners/requestform.asp.

About BSQUARE

BSQUARE Corporation (Nasdaq: BSQR) is a global leader in providing solutions for smart devices in consumer, enterprise, industrial and automotive markets. As a leading partner for Microsoft, BSQUARE empowers the creation, connection, and management of Windows Embedded-powered smart devices through software, hardware, and service solutions. BSQUARE has an extensive product portfolio of software development and quality assurance tools, device and device management software and complete end-to-end managed device solutions. BSQUARE provides critical engineering services including device development, quality assurance, and system integration as well as services for managing client devices deployed into the market. For more information, visit BSQUARE at www.BSQUARE.com or call 888-820-4500.

BSQUARE is a registered trademark of BSQUARE Corporation. All names, product names, and tradenames are trademarks or registered trademarks of their respective holders.

This release contains forward-looking statements relating to our sales that are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. The words "believe," "expect," "intend," "anticipate," variations of such words, and similar expressions identify forward-looking statements, but their absence does not mean that the statement is not forward-looking. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict. Factors that could affect BSQUARE's actual results include adverse changes in BSQUARE's relationship with Microsoft, a decline in the market for Windows Embedded smart devices or the failure of such market to develop as anticipated, risks associated with international business, a change in strategy relating to indirect channels, delays or announcements of delays by Microsoft of Windows Embedded product releases, risks associated with fixed-fee contracts, competition and intellectual property risks. A more detailed description of certain factors that could affect actual results include, but are not limited to, those discussed in BSQUARE's Quarterly Report on Form 10-Q, in the section entitled "Certain Factors That May Affect Future Results." Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. BSQUARE undertakes no obligation to update publicly any forward-looking statements to reflect new information, events or circumstances after the date of this release or to reflect the occurrence of unanticipated events.