Agoura Hills, CA, November 27, 2001 – Internet Machines Corporation, developer of the IMpower™ family of network processing, traffic management, and switching semiconductors for 10 Gbps Ethernet and OC-192c optical equipment, today announced that it, along with nine other debuting companies, has been chosen as one of the Fabless Semiconductor Association's (FSA's) Fabless Start-Ups of the Year. The awards will be presented at the FSA annual awards dinner celebration at 7:00 p.m. on Thursday, December 6, 2001, at the Santa Clara Convention Center.

Internet Machines was selected for meeting the FSA Venture Capital Advisory Board's criteria specifying companies who best performed in the areas of innovation, management team, growth, strategic partners, intellectual property and capitalization. Criteria for this award included company founding dates between January 2000 and August 2001, and recorded venture capital funding.

Internet Machines develops the IMpower system solution of highly integrated, protocol-independent semiconductors for 10 Gbps and OC-192c networking equipment. The IMpower family includes the NPE10 network processing engine, the TMC10 traffic management co-processor, and the SE200 switch element. The company has incorporated innovative packet processing techniques into highly integrated packages, using patent-pending algorithms and an advanced 0.13-micron manufacturing process. Internet Machines was founded in January 2000 and is led by a management team with years of experience in bringing multiple generations of leading-edge communications semiconductors to market. The company is backed by Redpoint Ventures, Meritech Capital Partners, Morgan Stanley, Exar, and Banc of America Securities, as well as several other strategic investors, and has raised in excess of $80 million since its inception. The company has announced several technology partnerships, including SiberCore Technologies, Kawasaki LSI, PMC-Sierra, Texas Instruments, and Fujitsu Microelectronics.

The FSA Annual Awards dinner themed, "Imagine the Future," recognizes the most outstanding fabless semiconductor companies for their achievements during the past year. The prominent industry event features James A. Baker III, former secretary of state, who will provide the keynote address. In addition, Michael L. Hackworth, chairman of Cirrus Logic, will be receiving the Dr. Morris Chang Exemplary Leadership award for his valuable contributions to the fabless industry.

"The FSA Annual Awards Dinner celebration has evolved into the most prestigious event for the fabless semiconductor industry," said Jodi Shelton, executive director of the FSA. "Companies such as Internet Machines that are recognized with nominations demonstrate the tenacity and positive forecast of the fabless industry, as they implement successful business plans reinforced by innovative technology and supportive financial management."

Chris Hoogenboom, president, CEO, and a founder of Internet Machines, said, "We are very pleased to be recognized by the FSA as a Fabless Start-Up of the Year. This award underscores our belief that only a select group of companies - those with innovative technology and sufficient funding - will be successful in this challenging market. We believe we are one of those companies."

The 2001 event is sponsored by a variety of premier companies within the semiconductor community including: Advantest; Broadcom; Cahners Electronics Group; Chartered Semiconductor Manufacturing; Deutsche Banc Alex. Brown; Dongbu; Ernst & Young; eSilicon; Lehman Brothers; Morgan Stanley; NVIDIA; PricewaterhouseCoopers; QUALCOMM; Robertson Stephens; Salomon Smith Barney; Simplex Solutions; Thomas Weisel Partners; TSMC and UMC.

For more information on the awards dinner, please visit http://www.fsa.org/dinner/.

About Internet Machines
Internet Machines is a fabless semiconductor company that offers the IMpower™ family of highly integrated communications ICs for OC-192c and 10 Gbps optical, metro area network and Internet infrastructure equipment. The protocol independent IMpower family consists of the NPE10 network processing engine, the TMC10 traffic management co-processor, the SE200 switch element, and the Development Workbench software development kit. This powerful array of wire-speed, fully programmable semiconductors and software simplifies development and greatly shortens the system vendor's time to market. The ICs work together or individually to deliver a highly flexible, interoperable, and field upgradeable solution. The company is headquartered in Agoura Hills in Southern California, with design centers located in San Diego and Irvine, and sales offices in San Jose, California, and Boston, Massachusetts.

About the Fabless Semiconductor Association
In 1994, industry leaders incorporated FSA (www.fsa.org) to achieve a more optimal balance between wafer demand and capacity. Its more than 300 corporate members represent fabless companies, integrated device manufacturers, foundry providers, packaging/assembly houses, electronic design automation companies, investment bankers, intellectual property providers and other companies.

The organization encourages the relationship between fabless companies and suppliers; facilitates business partnerships; creates awareness of the fabless business model; disseminates relevant data; and fosters standards and policies.

The FSA's vision is that by 2010 half of all integrated circuit revenue will come from fabless operations.

For more information, contact:

Kathy Tebben
818.575.2175
[email protected]