CASTELLE TO ACQUIRE IBEX TECHNOLOGIES, INC.
       Leader in LAN Fax Servers and Leader in Fax-on-Demand to Join Forces

SANTA CLARA, Calif., Aug. 22, 1996--Castelle  (NSDQ:CSTL), a leading supplier of
internetwork fax- and print-server  products,  has signed a definitive agreement
to purchase Ibex Technologies, Inc., the market leader in fax-on-demand systems.

Under  the  terms of the  agreement,  which is  accounted  for as a  pooling  of
interests,   Castelle  will  acquire  all  of  the  outstanding   stock  of  the
privately-held Ibex Technologies in exchange for approximately 850,000 shares of
Castelle  common  stock.  The closing  sale price for  Castelle  common stock on
NASDAQ on Aug. 21, 1996, was $7.00 per share.  The transaction has been approved
by the boards of directors of both  companies  and is subject to the approval of
Castelle and Ibex shareholders.

Castelle develops products that broaden  communications among workgroup users by
enabling them to send and receive faxes and print documents from their networked
PCs; the products are sold through domestic and international distributors,  and
selected  OEMs  worldwide.  Ibex's  product  line  includes  fax-on-demand,  fax
gateway,  fax  broadcast  and Web fax  applications  which are sold  direct  and
through  value-added  resellers  (VARs).  According  to recent  market  studies,
Castelle  and Ibex  hold 17  percent  and 18  percent  shares of the LAN fax and
fax-on-demand markets, respectively.

Art Bruno,  Castelle  CEO and  chairman,  said the  acquisition  will create "an
entity that  possesses the  technologies  and channels  necessary to address the
emerging market for universal  information-on-demand  solutions integrating fax,
e-mail and the World Wide Web. Unlike many merging companies,  Castelle and Ibex
have truly  complementary,  non-conflicting  sales  channels.  Ibex has over 100
sophisticated  VARs that have helped sell its products  into Fortune 1000 firms.
Castelle's workgroup-oriented products are available through a worldwide network
of leading distributors and resellers.  Together these channels will expand both
companies' sales  opportunities,  enabling Ibex to deliver  fax-on-demand to the
mass  market  and  Castelle  to  penetrate  large  enterprises  with its LAN fax
solutions."

Following the completion of the acquisition,  which is expected in October, Ibex
will operate as the Ibex Division of Castelle,  and its 25 employees will remain
in the  company's El Dorado  Hills,  Calif.,  headquarters.  Grant will head the
division,  reporting to Bruno.  Grant and other key Ibex  executives  will enter
into employment and non-competition agreements with Castelle.

Castelle  reported  1995  revenues of $25.1  million.  Ibex's 1995 revenues were
approximately $3.1 million.

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