NetObjects, headed by Chairman and CEO Samir Arora, will continue to operate as an independent company that supports leading platforms and standards. Michael D. Zisman, executive vice president at Lotus, will join NetObjects' Board of Directors and will represent IBM's interests. The original investors, the management team and employees of NetObjects will retain investment interests. No further details of the transaction were disclosed.

NetObjects is widely recognized as pioneering the category of site-based Web design software. The company's flagship product, NetObjects Fusion, has won several industry awards including CNET's 1997 Internet Excellence award for the Best Web Design Tool. The only site-oriented product that is available for both the Windows and Macintosh platforms, NetObjects Fusion is used by tens of thousands of Web designers, developers and professional site builders within small businesses and large corporations.

"IBM is investing in leading-edge technologies and companies which provide customer solutions that make e-business a reality," said John M.Thompson, senior vice president and group executive responsible for IBM's software business. "IBM recognizes the need for viable, independent software companies to fulfill the exploding market for open design tools any Web site builder can use. NetObjects will continue to establish strong business partnerships with other leading Internet software companies."

Recognized as a leading independent software company whose products are platform-neutral, NetObjects has forged partnerships with other industry leaders including AT&T, Microsoft, Netscape, Sun Microsystems, JavaSoft and UUNET.

"Fusion is the best Web site creation tool in the industry, taking full advantage of open standards such as HTML, Java, and Javascript," said Zisman. "Our investment in NetObjects will ensure that there are superb Web site creation tools, in addition to our own, that can fully exploit the extensive capabilities of the Lotus Domino Web server, as well as other IBM products such as DB2 and VisualAge. We know that our customers need a range of tools in this market, both for Webmasters and for application developers, and we're committed to ensuring that these open, standards-based tools are available across all industry standard platforms."

"IBM's investment in NetObjects will validate our unique approach to solving the problem of building Web sites and provides us with the worldwide reach and resources to establish Fusion as a standard in Web site publishing and Web applications," said Arora.

Since the introduction of NetObjects Fusion in September 1996, more than 150,000 site builders have downloaded it to build thousands of media-rich Web sites. NetObjects Fusion 2.0 for Windows is available today for an expected street price of under $500 in North America via Ingram Micro, a network of resellers and VARs and directly from NetObjects.

IBM, DB2 and VisualAge are trademarks or registered trademarks of International Business Machines Corporation. Lotus and Domino are trademarks of Lotus Development Corporation. NetObjects and NetObjects Fusion are trademarks of NetObjects, Inc. Other names are trademarks or registered trademarks of their respective companies