TOKYO, Japan -- 11
November 2008 -- Fixstars Corporation, a pioneering company in Cell
Broadband Engine™ based solutions, today announced the acquisition of
substantially all the assets of Terra Soft Solutions, the world
renowned developer of Yellow Dog Linux. The new subsidiary 'Fixstars
Solutions, Inc.', of San Jose, California, maintains the entire Terra
Soft staff, product line, and regional offices in Loveland, Colorado.

Terra
Soft was founded in 1999 to provide a Linux operating system for the
Power architecture family of microprocessors. With its early roots in
the Apple PowerPC, Terra Soft grew to become one of the top five Apple
Value Added Resellers, uniquely licensed to install an alternative to
Mac OS, with customers including Lockheed Martin, Boeing, NASA, DoE
labs and top universities.

Kai Staats,
former CEO of Terra Soft Solutions, now COO of Fixstars Solutions
states, “Terra Soft started with my personal credit card and what in
retrospect was an unlikely team to create a Linux distribution: a 17
year old sys admin, FileMaker Pro programmer, graphic designer, and
marketing consultant. Dan, Troy, Jake and I threw ourselves into the
challenge of building something which we were told (more than once) was
impossible. Over one hundred Linux companies came and went, but we
always pulled through.”

In the fall of
2005 Terra Soft began its work with Cell under contract with Mercury
Computer. A year later Terra Soft expanded its Cell support to the Sony
PS3. In 2007, Terra Soft released YDL v6.0 with support for the IBM
BladeCenter QS2x family of products.

Through
this acquisition, Fixstars will continue to maintain Yellow Dog Linux
as the only Linux OS with support for every Cell/B.E. based product on
the market, including Fixstars' own GigaAccel 180 and Sony ZEGO
BCU-100.

Staats continues, “Our ten
years' determination this year opened the door to a merger of teams and
talent which for me is the continuation of a dream. Miki-san and I, our
teams too, share a common vision and drive for completion of the Power
ecosystem and perfection which is now amplified and accelerated by the
new Fixstars Solutions.”

Founded in 2002,
Fixstars has since 2004 provided application development and
optimization services for the Cell Broadband Engine multi-core
processor. Fixstars maintains the world's largest dedicated Cell/B.E.
development staff. Fixstars' customers include industry leaders and
Cell consortium founders Sony, Toshiba, and IBM and companies such as
Mizuho Securities, Mitsubishi Research Institute, and Broadcast
International.

“A Cell/B.E. software
developer and long-time user of Yellow Dog Linux, Fixstars has great
faith in Yellow Dog Linux,” said Satoshi Miki, CEO of Fixstars. “This
business acquisition allows us to offer a reliable and stable Linux
distribution with sense of ease for our customers. I have no doubt that
in the expanding Cell/B.E. ecosystem we will offer the best Cell/B.E.
solution of the High Performance Computing generation.”

- Financial

- Healthcare & Life Sciences

- Petroleum Exploration

- Digital Media

Fixstars'
market specific solutions provide a marked advantage over in-house
optimization efforts which historically consume significant resources
to achieve the desired performance. The union of the Fixstars and Terra
Soft products, services, and engineering expertise forms a complete
Cell Broadband Engine ecosystem and client offering, reducing time
invested and total cost of ownership.

Fixstars now provides:

- Cell application optimization

- Middleware

- Yellow Dog Linux

- Cell based hardware