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Press Release

Bus-Tech, Inc.'s Mainframe Appliance for Storage Certified for Interoperability with FalconStor's IPStor Software

Together, companies provide SAN-based Tape-on-Disk for System/390

Burlington, MA and Melville, NY - August 6, 2002 - Bus-Tech™, Inc., a leading supplier of data center connectivity products, and FalconStor™ Software, Inc. (Nasdaq: FALC), a leading provider of network storage infrastructure software, announced today that Bus-Tech, Inc.'s Mainframe Appliance for Storage™ has been certified for interoperability with FalconStor's IPStor™. Together the companies provide an affordable, highly functional SAN-based Tape-on-Disk system for IBM System/390 class mainframes.

Bus-Tech, Inc.'s Mainframe Appliance for Storage (MAS) is a System/390 Tape-on-Disk Controller providing ESCON connection to System/390 class mainframes and UltraSCSI or Fibre Channel connection to open-systems storage. Tape files written from the mainframe to the MAS are stored on SCSI or Fibre Channel disks providing the customer enhanced backup/disaster recovery, open-systems data exchange, and improved operations efficiency through the elimination of tape.

FalconStor's IPStor provides a storage networking software infrastructure that enables companies to utilize storage efficiently, execute backup quickly, expand capacity smoothly, and significantly reduce total storage management costs. The software provides storage services-virtualization, active-active failover, capacity-on-demand, remote replication, mirroring, snapshot, zero-impact backup/restore enablers, and more through a software-only design that runs on existing industry standard hardware.

When the MAS is connected to an IPStor server via Fibre Channel, the IPStor server appears to the MAS as a SAN-attached disk. The MAS provides the tape-on-disk capabilities to the mainframe, appearing as multiple 3480 tape drives. IPStor provides Enterprise-class storage services including high availability, synchronous mirroring, remote replication, zero-impact backup enabler, DynaPath for Dynamic multi-pathing, and TimeMark/TimeView for scheduled disk-based change-journaling and instant data recovery. "The combination of IPStor and MAS enables customers to have a storage infrastructure with high-availability and business continuity," said Wayne Lam, FalconStor vice president of marketing and professional services. "Corporations can leverage their existing hardware investments by having their mainframes and storage systems interoperate to enjoy the benefits of near line storage with the confidence of high data availability." "Using IPStor to provide a storage infrastructure for Mainframe Appliance for Storage enhances our mainframe tape-on-disk capabilities with a rich set of backup/restore, remote data vaulting, and fault tolerance capabilities", said Ralph Armstrong, Bus-Tech, Inc. Vice President of Product Management. "Together Mainframe Appliance for Storage and IPStor software provide customers with cost-effective backup and disaster recovery capabilities for their mainframe which are based on open-systems storage networking."

The Mainframe Appliance for Storage and IPStor software were certified together using an IBM Multiprise 3000 mainframe running OS/390 version 2 release 10. IPStor software was run on an IBM xSeries 340 running Red Hat Linux version 7.2.

About Bus-Tech, Inc.
Bus-Tech, Inc. founded in 1987 is the industry's leading provider of state-of-the-art connectivity solution for the data center to Original Equipment Manufacturers. The company's powerful suite of adapter and platform solution satisfy even the most rugged demands of data processing professionals for high-bandwidth, high-availability, and high-performance connectivity. With more than 15,000 installed sites worldwide, Bus-Tech, Inc. is the recognized leader in the data center interconnect market. Headquartered in Burlington, MA, the company is privately held with location around the world. For more information about Bus-Tech, Inc. and its products, please visit the Bus-Tech, Inc. World Wide Web site at http://www.bustech.com, send e-mail to or call 800-284-3172 or 781-272-8200.

About FalconStor
FalconStor Software, Inc. (Nasdaq: FALC), offers network storage infrastructure software that dramatically reduces storage operating costs by aggregating and provisioning storage capacity and management services over Fibre Channel and IP-based storage networks. With unprecedented reliability, performance, manageability, and availability, FalconStor's flagship product, IPStor™, enables leading IT organizations and Service Providers to deploy a highly available network storage infrastructure to ensure business continuity.

Founded in 2000, FalconStor is headquartered in Melville, NY. International offices include Paris, Tokyo, and Taichung, Taiwan. FalconStor is a voting member of the Storage Networking Industry Association (SNIA) and Fibre Channel Industry Association (FCIA). For more information, visit www.falconstor.com or call 1-631-777-5188.

This press release includes forward-looking statements that involve risk and uncertainties that could cause actual results to differ materially from the forward-looking statements. These risks and uncertainties include: the early stage of FalconStor's business; delays in product development; market acceptance of FalconStor's products and services; technological change in the storage and networking industries; competition in the storage networking software market; the ability to achieve profitability; intellectual property issues; and other risk factors discussed in FalconStor's reports on Forms 10-K, 10-Q and other reports filed with the Securities and Exchange Commission.

FalconStor and IPStor are trademarks of FalconStor Software, Inc. All other company and product names contained herein are trademarks of the respective holders.

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