The strategic partnership with Applied Materials consists of two definitive agreements. Under a private placement agreement, Applied Materials acquired a 12.5 percent equity interest in Triant for an investment of $2.2 million. Under a separate license agreement, Applied Materials became the exclusive value-added reseller (VAR), in the semiconductor industry, of Triant's equipment health monitoring and fault detection software technology. Under the terms of the license agreement, Applied Materials has been granted the right to market a future version of Triant's ModelWare/RT, with its own products and services. Triant will receive a fee for each license shipped. Triant will continue to license its end user version of ModelWare/RT to semiconductor manufacturers for retrofit on all makes and models of wafer processing equipment using existing and new distribution channels. In addition, Triant retains all rights to license its software technology for use in other industries. This joint effort by Applied Materials and Triant will focus on helping customers better address the rapidly increasing requirement for higher overall productivity in their fabs.

Triant's second quarter financial results are as follows:

• Revenue for the six months ended June 30, 1999 was $309,640 (compared to $214,642 for the six months ended June 30, 1998). The increase in revenue was attributable to orders for our principal product, ModelWare/RT, both from direct sales and through our European distributor, Metron Technology.

• Costs and expenses for the six months ended June 30, 1999 were $1,041,420 (compared to $2,415,503 for the six months ended June 30, 1998). This 57% decrease in expenses is a result of the Company's restructuring decision in mid-1998 to focus on core development activities, eliminate certain direct sales and marketing activities, reduce management, sales and marketing, and non-core product development staff, and close excess facilities.

• Loss from operations and net loss for the six months ended June 30, 1999 were $731,780 (compared to loss from operations and net loss of $2,200,861 for the six months ended June 30, 1998). This 67% decrease in loss from operations and net loss for the six months ended June 30, 1999 reflects the combination of an increase in revenue and a significant decrease in costs and expenses. The loss per share for the six months ended June 30, 1999 was $0.04 (compared to a loss per share of $0.17 for the six months ended June 30, 1998). This 76% decrease in loss per share resulted from the combination of a lower net loss and a higher number of shares outstanding.

• At June 30, 1999, cash and cash equivalents were $2,318,588 (compared to $253,310 at June 30, 1998), working capital was $2,071,731 (compared to working capital deficiency of $537,588 at June 30, 1998), assets were $3,025,934 (compared to $676,293 at June 30, 1998), and shareholders' equity was $1,667,785 (compared to capital deficiency of $778,354 at June 30, 1998). Since the beginning of 1999, the Company has raised approximately $3.1 million in equity financing.

• Philips Semiconductors MOS4YOU wafer fab in Nijmegen, The Netherlands, has selected Triant's ModelWare/RT as their strategic Equipment health monitoring and Fault Detection solution for their entire metal etch section. Philips Semiconductors is also considering ModelWare/RT for other sections in its fab. Metron Technology, Triant's European distributor, is providing all ModelWare/RT sales, installation, and support services to Philips Semiconductors

• Domain Logix Corporation had signed a distribution agreement for the sales, installation, and support of Triant's ModelWare/RT software to end-users in the U.S. semiconductor industry. Domain Logix, a private company headquartered in Austin, Texas, delivers solutions to the semiconductor industry to maximize their customer's return on investment in terms of improved yield, quality, cycle-time, and cost.