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MESSAGE FROM THE CEO

Looking Forward into 2003

UltraBac Software has been a successful innovator in the backup and disaster recovery market for over 20 years. By consciously seeking to serve small to medium-size network users, we have met the critical utility software needs of the majority of backup users. Even the world's largest companies, which often have hundreds to thousands of smaller distributed networks, are finding a solution in our offerings.

In 2003, our most exciting area of growth is in providing enterprise customers with our innovative image-based disaster recovery software. Last April marked the release of UltraBac Version 7.0. This is the same great product, but with a totally new architecture, designed from the ground up to be the foundation for the sophisticated features and functions required for large networks.

Since the initial release of Version 7, our development team has added FTP device backup, Tivoli Storage Manager integration, enhanced remote administration, scheduling enhancements, remote storage devices, data encryption, client side compression, and the ability to restore individual files from image backups. Our current development plate includes: NDMP compliance, dynamic disk backup/restore, VSS, new agents for UX/MacOSX, disk pooling, and advanced media management.

Our major development commitment now is to create a world-class media management option for UltraBac enterprise customers, without making the base product too complex for use by the small to medium business market. A major benefit to Version 7's new code structure is it allows us to add functionality and correct problems more quickly, with less impact on reliability.

We appreciate good ideas and suggestions from users and frequently incorporate them, along with market-driven features and functions, in new versions. The dynamic backup and disaster recovery market requires frequent releases to meet the evolving requirements demanded by our customers.

We are committed to maintaining the ease with which UltraBac allows users to install, configure, and back up with little or no training. For those who do need help, our best-in-the-industry technical support team remains ready to answer questions and resolve issues.

By continuing to build on Version 7.0, UltraBac Software will be uniquely positioned to provide a total solution from the largest to the smallest of customers. Our primary goal remains the same today as when we started business in 1982 - to provide customers with reliable, easy-to-use, high performance software with the right features and functions needed to get the job done at a good price.

Sincerely,
Morgan Edwards
President and CEO