Network Peripherals

• MELVILLE, N.Y., August 23, 2001—FalconStor, Inc. ("FALC"), of Melville, New York, announced today the completion of its reverse merger with Network Peripherals Inc. ("NPI") (Nasdaq: NPIX), of Fremont, Calif. The transaction establishes the merged company, which has adopted the name FalconStor Software, Inc., as a publicly-listed, well-capitalized emerging leader in network storage infrastructure software, one of the fastest-growing areas of the $44 billion global storage industry. As a result of the transaction, FalconStor is now listed on the Nasdaq National Market and will trade under the symbol FALC.