FOR RELEASE ON AUGUST 2, 1988 From: System Enhancement Associates, Inc. (SEA) and PKWARE, Inc. and Phillip W. Katz (PK) August 2 1988 - Milwaukee, WI In the first known "Shareware" litigation, pending in the local United States District Court, the parties System En- hancement Associates, Inc. (Plaintiff - SEA) and PKWARE, Inc. /Phillip W. Katz (Defendants - PK), after reaching agreement, consented to the entry of the attached Judgment for Plaintiff on Consent. That Judgment was entered by Judge Myron L. Gordon, effective on August 2, 1988. Part of the agreement reached by the parties included a Confidential Cross-License Agreement under which SEA licensed PK for all the ARC compatible programs published by PK during the period beginning with the first release of PKXARC in late 1985 through July 31, 1988 in return for the payment of an agreed upon sum which was not disclosed. Additionally, PK was licensed, for an agreed upon royalty payment, to distribute its existing versions of PK's ARC compatible programs until January 31, 1989, after which PK is not licensed and agreed not to pub- lish or distribute any ARC compatible programs or utilities that process ARC compatible files. In exchange, PK licensed SEA to use its source code for PK's ARC compatible programs. PK agreed to cease any use of SEA's trademark "ARC" and to change the names or marks used with PK's programs to non-confusing designations. The Judgment provided for the standard copyright, trademark and unfair competition injunctive relief for SEA a- gainst PK, as well as damages and litigation expenses to be paid by PK to SEA. Both parties agreed to refrain from any comment concerning the settlement of the disputes, other than the text of this press release. Also, the parties instructed all of their representatives to refrain from any such activity. Any other details of the Cross-License Agreement were agreed to be maintained in confidence and under seal of the Court. In reaching the agreement to dispose of the pending litigation and to settle the disputes that are covered thereby, PK did not admit any fault or wrongdoing. Attachment: JUDGMENT FOR PLAINTIFF ON CONSENT