China's Largest Computer Company Selects M-Systems As the Flash Disk Supplier for Internet Appliance Product Lines

Business Wire, April 3, 2001

Business Editors/High-Tech Writers

FREMONT, Calif.--(BUSINESS WIRE)--April 3, 2001

Approximately 100,000 DiskOnChip(R) Flash Disks to be Purchased,

According to IA Business Division of Legend Computer System Ltd.

M-Systems Flash Disk Pioneers Ltd. (Nasdaq:FLSH), a leader in flash disk data storage products for embedded systems, Internet appliances and telecom/networking markets, today announced that Legend Computer System Ltd. (HKSE: 992), the largest computer company in the People's Republic of China (PRC), has selected M-Systems to supply the flash disks needed in their Internet Appliance (IA) product lines.

Legend is using M-Systems' DiskOnChip as the flash disk device in its JoyNet set-top box (STB) and iFeel cathode-ray tube-based Web screen. DiskOnChip will provide the flash disk capacity necessary for storage of the operating system (Windows CE), software and user data. DiskOnChip also allows for online upgrades of the operating system and product software.

More information is available on the Internet about the JoyNet set-top box at http://www.lcs.legend.com.cn/product/info_english/product/joynet.html and about the iFeel at http://www.lcs.legend.com.cn/product/info_english/product/ifeel.html.> "DiskOnChip's ease of integration and upgradability gives us a great deal of flexibility in meeting the needs of our customers," said Jia Zhaohui, general manager of the IA Business Division at Legend Computer System Ltd. "If things go as planned, we shall be selling approximately 100,000 products with DiskOnChip this year."

Internet Service Providers (ISPs) and Internet Content Providers (ICPs) are Legend's target customers for these two products. ISPs and ICPs can use either of the two products as a platform to provide home users with Internet services such as online shopping and video-on-demand. Legend can tailor the products to the needs of ISPs and ICPs and prices will be set according to the configuration.

"We are very excited to enter into this strategic relationship with Legend as their flash disk partner," said Barry Doong, president, M-Systems Asia. "The IA market in China is very promising and, by working together, our two companies will be able to reap the rewards of the growth forecast for the coming years by industry analysts."

About Legend Computer System Ltd.

Legend Computer System Ltd (HKSE: 992) is the largest computer company in the PRC. Its own brand PC has been the country's best-selling PC since 1997 and had a market share of 30.8% in Q4 2000. Legend also took the lead in the Asia Pacific market (excluding Japan) in the same quarter. Legend also distributes foreign brand IT products, provides systems integration services and manufactures motherboards.

Recently, Legend has begun to actively develop its Internet-related and e-commerce-related business. Legend was listed on the Hong Kong Stock Exchange in 1994 and is a constituent stock of the Hang Seng Index. Its American Depositary Receipts are also traded in the United States. More information about the company can be found on the Internet at www.legend-holdings.com.

About M-Systems Flash Disk Pioneers Ltd.

M-Systems Flash Disk Pioneers Ltd. (Nasdaq:FLSH) is a leading developer, manufacturer and marketer of innovative data storage products, known as flash disks, which are primarily used in embedded systems, Internet appliances and telecom/networking markets. The company's flash disks provide the functionality of a mechanical hard drive on a solid-state silicon chip.

M-Systems was first to bring to market a complete flash disk in a single die, using breakthrough DiskOnChip Millennium technology. The company's products are based on its patented TrueFFS technology and include the DiskOnChip(R), DiskOnKey(TM), and Fast Flash Disk (FFD) product families.

For more information, contact M-Systems at 8371 Central Ave., Suite A, Newark, Calif. 94560. Telephone: 510/494-2090, E-mail: info@m-sys.com; and, on the Internet, http://www.m-sys.com.

This news release includes forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Readers are cautioned not to place undue reliance on these forward-looking statements, as they are subject to various risks and uncertainties that may cause actual results to vary significantly. These risks include (but are not limited to) those related to the risk that the design win and/or purchases contemplated in this release will be delayed or cancelled, in whole or in part; that any other expected orders from this customer may not materialize; as well as the other risk factors detailed in the company's registration statement dated March 7, 2000, and other filings with the Securities and Exchange Commission.

Note To Editors: All company and product names mentioned may be trademarks or registered trademarks of their respective holders and are used for identification purposes only.